Coromandel International Limited · NSE:COROMANDEL
Coromandel International — Investor Presentation (December 2019)
43 slides from Coromandel International's investor presentation, December 2019
Slide 1: Investor Presentation
Investor Presentation December 2019
Slide 2: Disclaimer
Disclaimer Certain statements made in this presentation may not be based on historical information or facts and may be “forward looking statements,” including those relating to general business plans and strategy of Coromandel International Ltd, its future outlook and growth prospects, and future de
Slide 3: Agenda
Agri industry: The opportunity ahead Coromandel: Strong track record, future positive Business-wise highlights: Unique strengths to win in the market The Coromandel investment case: Summary 2
Slide 4: Agri industry: The opportunity ahead
Agri industry: The opportunity ahead Coromandel: Strong track record, future positive Business-wise highlights: Unique strengths to win in the market The Coromandel investment case: Summary 3
Slide 5: Global: Increasing population and wealth to drive up global food consumption
Global: Increasing population and wealth to drive up global food consumption Strong increase in food demand expected Increasing Food consumption Transition countries Near East/North Africa Sub Saharan Africa East Asia population (M tons) Latin America & Carribean Industrial countries South Asia 6,00
Slide 6: Global agri trend: Rising consumption & resource exhaustion
Global agri trend: Rising consumption & resource exhaustion Strong increase in food demand expected…. Combined with non-ceasing water and land scarcity seen leading to Natural Resource pressure triangle Transition countries Industrial countries East Asia Latin America & Carribean Sub Saharan Africa
Slide 7: India: A decade of accelerated growth
India: A decade of accelerated growth … GDP US$B 40y 20y 20y 2011 2030 10,000 ~+$450B +$2,200B +$6,000B 8,000 6,000 $8-9T 4,000 2,000 $2.7T $500B $36B 1960 2000 2020 2030 Year Ranking basis GDP, India expected to be 3rd largest economy nominal, US$ B Note: Forecasts by International Monetary Fund, O
Slide 8: India: Unparalleled value creation in Agri sector over the next 10 years
India: … with unparalleled value creation in Agri sector over the next 10 years in India Gross value added by Agri sector (cumulative) ₹230 trillion ₹171 2019-29 trillion ₹120 trillion 2008-18 2X 1997-07 India Agri: ~$1.7 trillion to ~$3.3 trillion in 30 years 7 1. USD / INR rate conversion assumed
Slide 9: India: The opportunity and imperative for value creation in Agri sector
India: The opportunity and imperative for value creation in Agri sector over the next 10 years are large… Falling per capita land holding Imbalanced Nutrient Usage 2.5 14 Avg. landholding size (ha) N:P:K Consumption Ratio 12 2 10 1.5 8 1 6 0.5 ideal ratio → 4: 2: 1 4 FY11 → 4.7: 2.3: 1 0 2 1970-71 1
Slide 10: 8 global agri trends: Impact on India
8 global agri trends : Impact on India Rising pressure on Changing Evolution of Farm natural resources dietary preferences farm holdings labor shortages Done Pressure on natural resources Dietary patterns are evolving as Declining avg. farm holding Decreasing labour is driving greater push demand fo
Slide 11: Trends opening up significant opportunities for Agri cos
Trends opening up significant opportunities for Agri cos Themes Implications Rising pressure on Continued • Focus on balanced plant nutrition and improved natural resources importance to Ag input penetration Political economy • Focus on specialized nutrients and ag inputs for F&V, pulses in line wit
Slide 12: Government policy focus positive for value creation in Agri sector
Government policy focus positive for value creation in Agri sector • Doubling of farmer income: Productivity, Price Realization – Productivity: Soil Health Cards, customized fertilizer – Realization: Direct Income Support - Centre & State initiatives, Agri Insurance, Electronic Agriculture Markets,
Slide 13: Coromandel: Strong track record, future positive
Agri industry: The opportunity ahead Coromandel: Strong track record, future positive Business-wise highlights: Unique strengths to win in the market The Coromandel investment case: Summary 12
Slide 14: Murugappa Group: Coromandel flagship company of the group
Murugappa Group: Coromandel flagship company of the group Workforce Businesses Revenue Market Cap Locations 28; 50,000+ 9 listed 5.27 Bn USD 9.4+ Bn USD 90 entities Coromandel Agriculture EID Parry CUMI Engineering Tubes Investment Chola Finance Financial Services Chola MS 13 119 years of trust @ 70
Slide 15: Coromandel: Strong Governance Structure
Coromandel: Strong Governance Structure Eminent Board Professional Management Engaged employees 14
Slide 16: Coromandel: a strong, responsible company
Coromandel: a strong, responsible company Key Facts : • Turnover: USD 1.9 bil (FY18-19), USD 1 Bn (H1 FY20) • Market Cap: USD 1.7 bil (Sep 2019) • Strong credit rating: ‘AA +’ (Stable outlook)’ with CRISIL India • Zero long term debt • ~4500 employees & ~7500 contract staff COST EFFECTIVE BRINGING P
Slide 17: Coromandel: India footprint
Coromandel: India footprint India’s largest private sector Phosphatic 16 manufacturing locations Fertilizer company Jammu Pioneers & market leaders ~800 Retail centres in Specialty Nutrients India’s largest Single Super Phosphate (SSP) Raebareli ~20,000+ dealers company Kota 5th largest Crop Udaipur
Slide 18: Coromandel: Global footprint & collaborations
Coromandel: Global footprint & collaborations Strategic Investment TIFERT—Phos acid • Highly diversified venture in Tunisia sourcing Marketing partnerships – Bio Technology • Significant market US, Canada, Europe partnership & Regional Office, presence in China International markets Rock Phosphate M
Slide 19: Coromandel: A 'Farmer First' winning business model
Coromandel: A 'Farmer First' winning business model Farmer First Seeds Portfolio Farm implements Specialty Crop Aqua/Vet Feed Fertilizer Organic Biologicals Nutrients Protection Traded Products Rural Retail Ag Tech Farm Services Testing services (Soil, Water, Tissue) Advisory Financing & Insurance 1
Slide 20: Coromandel: Converting farmer insights into farmer prosperity
Coromandel: Converting farmer insights into farmer prosperity Direct connect with farmers • Deep insight on farmer preferences, cropping patterns, pest incidence, area Marketing & Activation under cultivation, hyperlocal trends • Educating, disseminating best-in-class package of practices, driving c
Slide 21: Business-wise highlights: Unique strengths to win in the market
Agri industry: The opportunity ahead Coromandel: Strong track record, future positive Business-wise highlights: Unique strengths to win in the market The Coromandel investment case: Summary 20
Slide 22: Fertilizer: Opportunity to address nutrient imbalance
Fertilizer: Opportunity to address nutrient imbalance Widespread Soil Deficiency Nitrogen Phosphorus Potassium Nitrogen Zinc xxx Nitrogen Iron xxx Potassium Huge opportunity xxx xxx Copper Over 50% Over 50% Sulphur exists for Fertilizer 20% to 50% 20% to 50% Less than 20% Less than 20% Punjab Punjab
Slide 23: Fertilizer: Positive Policy Measures
Fertilizer: Positive Policy Measures Soil Health Cards … Direct Benefit Transfer (DBT) JAM Trinity for Direct Transfers Boosting investments • Scheme started in 2015 by • In 2018, DBT implemented • Rural India high on “JAM” • Self sufficiency in Urea— Government of India pan India coverage—Jan Dhan
Slide 24: Coromandel Fertilizer: Highlights
Coromandel Fertilizer: Highlights Differentiated Product Offering Efficient Manufacturing Winning in Markets 38% 4.5 16.3% unique MT Market share capacity share 38% 38% 83% 85% 16.3% 33% 33% 70% 70% 15.8% 14.4% 14.6% 1.0 1.1 0.9 2.9 2.9 0.8 2.4 2.4 Mil tons Mil tons FY16 FY17 FY18 FY19 FY16 FY17 FY1
Slide 25: Crop Protection: Market opportunity large
Crop Protection: Market opportunity large India … massive potential exists Exports slated to grow at 9% CAGR India – Consumption lowest in world Pesticide consumption 3.2 (kg/hectare) 20 17.0 2.0 India is well positioned to 13.0 12.0 10 7.0 7.0 1.1 tap the huge multi-year 0.6 exports opportunity in
Slide 26: Coromandel Crop Protection: Highlights
Coromandel Crop Protection: Highlights Key Strengths Product Offering 5th 10,000 • 1000+ product registrations globally resulting in geographically diversified Largest crop dealers sales protection company • Focus on new products/combinations in India development - Rich product pipeline Presence acr
Slide 27: Coromandel Biologicals: Highlights
Coromandel Biologicals: Highlights Key Strengths New Product development • Rich product pipeline • Strong R&D capabilities: Research on Azadirachtin from plant extracts, microbial bio pesticides • Tie-ups with Indian and International CROs No.1 60% Azadirachtin Export share Manufacturing • Manufactu
Slide 28: Coromandel Crop Protection: Global footprint
Coromandel Crop Protection: Global footprint Beyond India … Creating a true global champion Europe APAC 3% 13% 7 subsidiaries at • Mexico • Brazil US & Canada 2% • Argentina • Netherlands Central America 5% • Nigeria • Philippines South • Australia 13% America China office 12% 51% Africa India Inter
Slide 29: Specialty Nutrients: Market opportunity large
Specialty Nutrients: Market opportunity large – micro irrigation, secondary & micro nutrients Potential for Specialty Nutrients business to capture market as micro-irrigation coverage expands Current Micro Irrigation coverage in India at 6% (US: 55%, Brazil: 52%, China: 10%) Potential: 69 mil Ha Cur
Slide 30: Coromandel Specialty Nutrients: Highlights
Coromandel Specialty Nutrients: Highlights Key Strengths Market Activation Product Offering • Focus on Crop specific nutrient & liquid leaders Tie-ups with Drip Irrigation, contract fertilizer solutions targeting Cereals, pulses, cotton and horticulture crops In WSF & Sulphur farming, Agri • Exclusi
Slide 31: Coromandel Retail: Comprehensive Agri Solutions
Coromandel Retail: Comprehensive Agri Solutions Key Strengths ~800 ONE Key achievements • India's largest agri retail chain Retail Centers Stop Shop for • Strong brand equity providing customer Agriculture value proposition of Quality, Trust & Significant needs farm Advice presence in AP, TG, KN; fo
Slide 32: Coromandel Organic: Highlights
Coromandel Organic: Highlights Key Strengths Product Offering No.1 • Product portfolio: – Soil health (City compost) Organic fertilizer – Soil nutrition (Kash, PROM, CMS, Nrich) – Soil amendment (gypsum) marketer in India Growth drivers for future Sales & Marketing / Activation • Regulatory push • L
Slide 33: Coromandel AgTech: Successful forays
Coromandel AgTech: Successful forays Coromandel has successfully forayed into Agtech by carrying out pilot trials using Drones Real time crop diagnostics quickly highlighting stressed regions needing intervention made possible Crop advisory provided to farmers based crop diagnostics results Timely i
Slide 34: Coromandel: Leveraging Technology for Farmer Prosperity
Coromandel: Leveraging Technology for Farmer Prosperity ~50,000 soil tests carried out annually Farm advisory through Scientists’ Gromor Nutrient Manager based panel nutrients recommendations Hiring Farm machinery through Custom Developing superior delivery E kiosks for improving reach & product Hir
Slide 35: Coromandel: Focus on Sustainable development
Coromandel: Focus on Sustainable development Bird’s Paradise Bio Mining Green Belt • Bird’s Paradise was established at ▪ Bio mining plant at Vizag: ▪ Converting Phospho gypsum heaps Kakinada plant is home to 100+ Converting city waste to Organic into green belt species manure ▪ 1st of its kind init
Slide 36: Coromandel CSR: Doing it responsibly
Coromandel CSR: Doing it responsibly Healthcare Initiatives Girl Child Education Scheme Community Development • Coro Medical Centres have • Girl Child Education Scheme has • Community development touched 70K+ beneficiaries touched 16K+ children and initiatives focussed on creating annually counting
Slide 37: The Coromandel investment case: Summary
Agri industry: The opportunity ahead Coromandel: Strong track record, future positive Business-wise highlights: Unique strengths to win in the market The Coromandel investment case: Summary 36
Slide 38: Coromandel: Track record of sustained financial performance
Coromandel: Track record of sustained financial performance Revenue* From Operations EBITDA Profit after Taxes (₹ Crores) (₹ Crores) (₹ Crores) 4% CAGR 19% CAGR 26% CAGR 13240 1450 714 11690 1305 685 11168 10239 1036 477 856 358 2016 2017 2018 2019 2016 2017 2018 2019 2016 2017 2018 2019 *Fertilizer
Slide 39: … with top quartile investor returns
… with top quartile investor returns 3-year Total Shareholder Return (TSR) Companies Ranked by TSR Coromandel 20% Delivering superior 1st qtr = 15.5% investor returns Median Among the top = 3.6% quartile cos. across BSE 200 3rd qtr = -10.0% Top performers in Ag segment -80 -60 -40 -20 0 20 40 60 Ann
Slide 40: Holistic farm solutions provider with unique business model
Coromandel – Holistic farm solutions provider… …with unique business model driving farm prosperity Farmer First Seeds Portfolio Farm implements Specialty Crop Aqua/Vet Feed Fertilizer Organic Biologicals Nutrients Protection Traded Products Rural Retail Ag Tech Farm Services Testing services (Soil,
Slide 41: Eight key elements of our Strategy
Accelerate the innovation agenda 1 Strengthen Build power 8 2 capabilities brands Eight key elements of our Strategy to Partnering with Government on 7 3 Reinforce consumer capture the India Agri reforms strongholds Ag opportunity & deliver consistent value… Build stronger processes with focus 6 4 L
Slide 42: Coromandel Value Proposition
Coromandel Value Proposition Unparalleled value creation Coromandel has a strong opportunity in India track record of delivering agriculture space consistent value • India agriculture opportunity • Top quartile TSR performer over large; GV to reach INR 230 the last 3 years (in the S&P BSE trillion b
Slide 43: Thank You
Thank You Corporate Office: For Investor Relations, contact: Coromandel International Ltd., Ms Jayashree Satagopan Coromandel House, 1-2-10, SP Road JayashreeSatagopan@coromandel.murugappa.com Secunderabad, Telangana 500003 Mr Saurabh Jain JainS1@coromandel.murugappa.com Phone no: 040 6699-7300 42
Coromandel International — Investor Presentation (December 2019) on 6ix