Sarda Energy & Minerals Limited · NSE:SARDAEN
Sarda Energy & Minerals — Q3 FY2023 Earnings Presentation
44 slides from Sarda Energy & Minerals's earnings presentation, Feb 13, 2023
Slide 1: Exchange filing cover letter for investor presentation
An ISO 9001, ISO 14001 & ISO 45001 Certified Company SARDA ENERGY & MINERALS LTD. 13th February 2023 BSE Ltd National Stock Exchange of India Ltd. The Department of Corporate Services Exchange Plaza, Bandra Kurla Complex Phiroze Jeejeebhoy Towers Bandra (E), Mumbai – 400051 Dalal Street – Mumbai 400
Slide 2: Sarda Energy and Minerals Limited Investor Presentation Q3 & 9MFY23
Sarda Energy and Minerals Limited ‘It’s Energy and Minerals, Not Only Steel’ Investor Presentation | Q3 & 9MFY23
Slide 3: Safe Harbour Statement
Safe Harbour Statement This presentation and the accompanying slides (the “Presentation”), which have been prepared by Sarda Energy & Minerals Ltd (the “Company”) solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities
Slide 4: Table of Contents
Table of Contents 1 Q3 & 9MFY23 - Key Highlights 2 SEML – Beyond Steel 3 Business Segments 4 Corporate Social Responsibility 5 Financials ‘It’s Energy and Minerals, Not Only Steel’ 3
Slide 5: Q3 & 9MFY23 | Key Highlights
an Q3 & IMFY23 | Key Highlights
Slide 6: Q3FY23 Performance Highlights
Q3FY23 Performance Highlights Operating EBITDA* Margin (%) PAT^ Margin (%) Standalone (INR Cr) Revenue From Operations 688 698 186 671 197 190 151 176 134 29% 25% 28% 20% 21% 25% Q3FY22 Q2FY23 Q3FY23 Q3FY22 Q2FY23 Q3FY23 Q3FY22 Q2FY23 Q3FY23 Revenue From Operations Operating EBITDA* Margin (%) PAT^
Slide 7: Improvement in Debt Profile and Credit Rating
Improvement in Debt Profile and Credit Rating Standalone (INR Cr) Gross Debt Net Debt* SEML - Credit Ratings – Upward Trajectory 391 270 345 171 137 174 (127) (363) Mar-20 Mar-21 Mar-22 Dec-22 Consolidated (INR Cr) Gross Debt Net Debt* 1,687 1,714 1,581 1,371 Name of Subsidiary Reviewed on Current P
Slide 8: Well Diversified Cashflow Profile of the Company
Well Diversified Cashflow Profile of the Company… Operating EBITDA Bridge (INR Cr) – Q3FY23 ...Spread across cyclical and non-cyclical business streams ‘It’s Energy and Minerals, Not Only Steel’ 7
Slide 9: Update on Ongoing Projects
Update on Ongoing Projects ➢ Gare Palma IV/7 Coal Mine, Chhattisgarh ✓ Capacity expansion from 1.2 MTPA to 1.8 MTPA – mining plan approved Mining ➢ Shahpur West Coal Mine, Madhya Pradesh ✓ Extractable reserves of 13.4 MT and Production capacity of 0.6 MTPA; Mining plan has been approved; Public hear
Slide 10: Consolidated P&L Highlights
Consolidated P&L Highlights INR in Cr Q3FY23 Q3FY22 YoY Q2FY23 QoQ 9MFY23 9MFY22 YoY Revenue from Operations 908 999 -9% 967 -6% 3,136 2,856 10% Other Income 44 -13 21 26 16 Total Income 952 986 -3% 988 -4% 3,161 2,872 10% Raw Material 550 550 513 1,786 1,505 Employee Expenses 31 26 33 96 77 Other O
Slide 11: Standalone P&L Highlights
Standalone P&L Highlights INR in Cr Q3FY23 Q3FY22 YoY Q2FY23 QoQ 9MFY23 9MFY22 YoY Revenue from Operations 698 671 4% 688 1% 2,205 1,881 17% Other Income 41 -1 61 70 48 Total Income 738 670 10% 749 -1% 2,275 1,929 18% Raw Material 419 400 396 1,278 1,081 Employee Expenses 24 18 23 72 54 Other Operat
Slide 12: Steel Segment - Product Price Trend
Steel Segment - Product Price Trend Iron Ore Pellet Sponge Iron Steel Billets Wire Rod H.B. Wire 2,784 677 1,818 3,295 4,136 4,897 3,201 2,454 2,315 2,348 3,061 3,602 3,266 3,246 1,337 18,888 18,124 INR / MT 15,340 4,497 1,878 13,774 15,307 2,297 14,380 12,453 Value 1,849 2,790 3,092 12,375 Addition
Slide 13: Steel Segment: Stable Demand Across Most Products
Steel Segment: Stable Demand Across Most Products Iron Ore Pellet (‘000 MT) Sponge Iron (‘000 MT) Steel Billet (‘000 MT) 612 226 582 205 166 Production 146 199 212 83 77 64 51 Q3FY22 Q3FY23 9MFY22 9MFY23 Q3FY22 Q3FY23 9MFY22 9MFY23 Q3FY22 Q3FY23 9MFY22 9MFY23 Iron Ore Pellets (‘000 MT) Sponge Iron (
Slide 14: Steel Segment: Focus on Selling Value-Added Products
Steel Segment: Focus on Selling Value-Added Products Wire Rod (‘000 MT) H. B Wires (‘000 MT) Ferro Alloys (‘000 MT) 114 111 138 29 Production 120 23 52 40 43 40 10 8 Q3FY22 Q3FY23 9MFY22 9MFY23 Q3FY22 Q3FY23 9MFY22 9MFY23 Q3FY22 Q3FY23 9MFY22 9MFY23 Wire Rod (‘000 MT) H. B Wires (‘000 MT) Ferro Allo
Slide 15: Power Segment - Generation & Sales
Power Segment - Generation & Sales Thermal Power + Waste Heat = Total Capacity 161.5 MW Hydro Power: Total Operational Capacity ~143 MW G E NE RATIO N ( M N KWH) G E NE RATIO N ( M N KWH) 466 800 762 399 272 277 110 98 Q3F Y22 Q3F Y23 9M F Y 22 9M F Y23 Q3F Y22 Q3F Y23 9M F Y22 9M F Y 23 SALE S ( M
Slide 16: Key Strategies to Drive Growth and Competitive Advantage
Key Strategies to Drive Growth and Competitive Advantage Backward Integration Capacity Expansion Diversification Adding Annuity-like Revenue Stream (Hydro) Reduce Input Costs and Ensure Consistent Supply • Commissioned 36 MVA Ferro Alloys furnace in Vizag in Dec-22, ahead of schedule • Commercialize
Slide 17: SEML | Beyond Steel
an SEML | Beyond Steel
Slide 18: Robust Business Model with Diversified Business
Robust Business Model with Diversified Business Adding Value through Minerals and Energy MINERALS METALS HYDRO ✓ Captive Iron Ore mine and commercial Coal Mines ✓ Vast experience of over 49 years in Steel Manufacturing ✓ To de-risk from the cyclicality of Metals business, SEML provide long term stab
Slide 19: Strategically Located Assets – Proximity to Raw Materials and End Users
Strategically Located Assets – Proximity to Raw Materials and End Users… Iron Ore and Coal Mines located within ~140 km and ~200 km respectively, from the End-user plant at Chhattisgarh Captive Iron Ore Mine at Rajnandgaon, Chhattisgarh (rated capacity of 1.5 MMT p.a.) Coal Mine at Gare Palma IV 7,
Slide 20: Built Over Four Decades of Excellence
…Built Over Four Decades of Excellence 1979-89 1989-99 1999-08 2008-18 2018-22 ▪Company started 24 MW captive ▪4.8 MW Hydro power plant ▪Billet capacity increased by 50% ▪Acquired Raipur Wires and Steel as a ▪Installed 25 TPD Electric Arc Furnance sick unit in 1979 in 1990 power plant and Ferro Allo
Slide 21: Well-Experienced and Strong Leadership at the Helm
Well-Experienced and Strong Leadership at the Helm Kamal Kishore Sarda Pankaj Sarda CMD Joint MD • Mechanical Engineer with 45 years • Mechanical Engineer with 17 years experience in Iron and Steel Industry experience in Iron and Steel Industry • Responsible for the groups vision and • Responsible f
Slide 22: Business Segments
Business Segments
Slide 23: Metals and Mining Business | Vertically Integrated Steel Player
Metals and Mining Business | Vertically Integrated Steel Player… Raw Material & Energy Generation (Captively procured key inputs, assure cost and quality control) Raw Material & Energy Generation Iron Ore Mine | Coal Mine | Power Intermediate / Finished Products (Flexibility to sell products across
Slide 24: Backed by Captive Resources, Driving Down Costs Significantly
… Backed by Captive Resources, Driving Down Costs Significantly Captive Iron Ore Mine Two Coal Mines Captive Thermal + Waste Heat Plants (Total Capacity of 1.5 MMT p.a.) (Total Capacity of 1.8 MMT p.a.) (Total capacity of 161.5 MW) • Located at Rajnandgaon, Chhattisgarh, which is ▪ Gare Palma IV/ 7
Slide 25: Robust Presence Across Steel Products – Siltara Plant
Robust Presence Across Steel Products – Siltara Plant in Chhattisgarh… Pellets Sponge Iron Billets Wire Rods HB Wires Semi finished steel product Produced from captive Iron produced by continuous Hot rolled product made HB Wires- Wire rods are Produced from Iron Ore Ore Lumps & Pellets. Description
Slide 26: Leading Manufacturer and Exporter of Ferro Alloys
…And a Leading Manufacturer and Exporter of Ferro Alloys ▪ Manufactures manganese-based Ferro Alloys sold domestically as Domestic Sales ('000 MT) Exports ('000 MT) well as exported to other countries ▪ Leading exporter of manganese-based Ferro Alloys ▪ Exports Awards: ▪ SMAL received prestigious ex
Slide 27: Hydro Power Business | Operational Assets of ~143 MW
Hydro Power Business | Operational Assets of ~143 MW… 4.8 MW 24.9 MW 113 MW Location Uttarakhand Chhattisgarh Sikkim Name of the River Sarju Gullu Rongnichu Year of 2008 2017 2021 Commissioning Tariff INR 3.85 per unit INR 5.21 per unit Final tariff under determination Term of PPA 30-year PPA with S
Slide 28: Track Record of Robust PLF and Annuity-like Revenue
…With Track Record of Robust PLF and Annuity-like Revenue + High Margin Generation and Sales (Mn KwH) Revenue (INR Cr) & EBITDA Margin (%) Generation Sales 417 400 100% 417 88% 86% 85% 90% 350 80% 300 69% 271 70% 250 60% 200 50% 150 40% 129 129 115 115 30% 85 85 100 68 58 20% 45 50 10% 0 0% FY19 FY2
Slide 29: Corporate Social Responsibility
Corporate Social Responsibility
Slide 30: Focus on Safety, Health & Social Responsibility
Focus on Safety, Health & Social Responsibility Health & Safety No. of Incidents Social Responsibility 23 7 3 3 2 CY21 CY18 CY19 CY20 CY22 ‘It’s Energy and Minerals, Not Only Steel’ 29
Slide 31: Education: Enabling Quality Education in Community
Education: Enabling Quality Education in Community ▪ Salary support to Teachers at Siltara & Mines area village schools ▪ Road Safety Awareness in schools – 6 Session ▪ Reward to meritorious students of 10th & 12th of Siltara, Mandhar & Girod ▪ School furniture support to Saraswati Shishu Mandir, Ra
Slide 32: Healthcare: Preventive & Curative Healthcare Services
Healthcare: Preventive & Curative Healthcare Services ▪ Doctors for community healthcare services, for doorstep services ▪ Operating mobile medical van with free medicines ▪ Community Eye Health Check Up Camp in 10 villages ▪ Distribution of spectacles to the BPL family patients ▪ Awareness session
Slide 33: Infrastructure: Creating Community Assets
Infrastructure: Creating Community Assets ▪ Construction of five primary school buildings in Kabirdham ▪ Construction of Jheeram ghati Chowk Dharsiwan ▪ Construction of Pachri in Khudmudi village ▪ Drinking water line and bore connection with pump at Siltara Primary school ▪ Construction of Garbage
Slide 34: Livelihood: Environmental & Economic Sustainability
Livelihood: Environmental & Economic Sustainability ▪ Started Sewing Training for 70 women & girls at Siltara & Girod ▪ Livelihood promotion through Cattle distribution to 35 Farmers ▪ Documentation & Record keeping training to three participants ▪ Training with CBWE on Women Empowerment at Tekari V
Slide 35: Art, Culture & Sports: Sports & Cultural Development
Art, Culture & Sports: Sports & Cultural Development ▪ Support for the local cultural program Madai, Mela & Jhanki ▪ Donated for marriage of 21 no. poor and physically challenge couple ▪ Support for Sansad Khel Mahotsava, Raipur ‘It’s Energy and Minerals, Not Only Steel’ 34
Slide 36: Financials
an Financials
Slide 37: Strong Balance Sheet: Comfortable Leverage Position
Strong Balance Sheet: Comfortable Leverage Position Figures in INR Crore 3,161 3,004 2,218 2,199 2,190 • Improving TOL/ NW ratio along 2,132 2,081 with strong liquidity position 1,870 1,807 1,743 • With additional cashflows post commissioning of Sikkim Hydro 1.14 1.04 project and operationalization
Slide 38: Consolidated P&L – Consistent Growth and High Profit Margins
Consolidated P&L – Consistent Growth and High Profit Margins INR in Cr FY19 FY20 FY21 FY22 9MFY23 Revenues 2,324 2,000 2,199 3,914 3,136 Other Income 17 -17 144 50 26 Total Income 2,341 1,983 2,343 3,964 3,161 Raw Material 1,493 1,293 1,347 2,086 1,786 Employee Expenses 87 88 89 113 96 Other Operati
Slide 39: Consolidated BS – Conservative Capital Structure and Strong Liquidity Profile
Consolidated BS – Conservative Capital Structure and Strong Liquidity Profile INR in Cr Mar-19 Mar-20 Mar-21 Mar-22 Sep-22 Share Capital 36 36 36 36 35 Tangible Networth 1,707 1,834 2,182 2,968 3,126 Minority Interest 132 100 101 104 107 Long Term Borrowings 1,078 1,408 1,493 1,196 1,111 Short Term
Slide 40: Yearly Trend | Production and Sales (1/2)
Yearly Trend | Production and Sales (1/2) Iron Ore Pellets Sponge Iron Steel Billet PRODUCTION ('000 MT) PRODUCTION ('000 MT) PRODUCTION ('000 MT) 741 600 600 619 612 302 325 291 294 177 192 175 166 205 157 FY19 FY20 FY21 FY22 9MFY23 FY19 FY20 FY21 FY22 9MFY23 FY19 FY20 FY21 FY22 9MFY23 SALES ('000
Slide 41: Yearly Trend | Production and Sales (2/2)
Yearly Trend | Production and Sales (2/2) Wire Rod H. B. Wires Ferro Alloys PRODUCTION ('000 MT) PRODUCTION ('000 MT) PRODUCTION ('000 MT) 161 32 142 147 29 159 138 26 145 119 21 23 124 132 111 FY19 FY20 FY21 FY22 9MFY23 FY19 FY20 FY21 FY22 9MFY23 FY19 FY20 FY21 FY22 9MFY23 SALES ('000 MT) SALES ('0
Slide 42: Power Segment: Generation & Sales (volumes)
Power Segment: Generation & Sales (volumes) Thermal Power + Waste Heat = Capacity of ~162 MW Hydro Power – Capacity of ~143 MW (Figures in Mn KwH) (Figures in Mn KwH) 1,076 1,079 466 466 999 964 417 417 762 115 115 129 129 173 142 85 85 103 76 55 FY19 FY20 FY21 FY22 9MFY23 FY19 FY20 FY21 FY22* 9MFY2
Slide 43: Share Price Information
Share Price Information Volume (# Shares) Share Price (INR) 1400 800000 1200 700000 600000 1000 500000 800 400000 600 300000 400 200000 200 100000 0 0 10-Feb-22 10-Mar-22 10-Apr-22 10-May-22 10-Jun-22 10-Jul-22 10-Aug-22 10-Sep-22 10-Oct-22 10-Nov-22 10-Dec-22 10-Jan-23 10-Feb-23 Capital Market Info
Slide 44: Thank You
THANK YOU Mr. Nilay Joshi (Head – Corporate Finance) Ms. Pooja Sharma / Ms. Vinita Pandya njoshi@seml.co.in pooja.sharma@stellar-ir.com / vinita@stellar-ir.com 125 B-Wing Mittal Court, Nariman Point, Mumbai 400 021 A-405, Kanakia Wall Street, Andheri (East), Mumbai 400 093 www.seml.co.in ‘It’s Energ
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