Adani Ports & Special Economic Zone Ltd · NSE:ADANIPORTS
Adani Ports & Special Economic Zone — Merger or Acquisition (October 2020)
29 slides from Adani Ports & Special Economic Zone's merger presentation, Oct 5, 2020
Slide 1: Krishnapatnam Port Transformational Acquisition
Krishnapatnam Port Transformational Acquisition 5th October, 2020
Slide 2: Agenda
A Group Profile B KPCL a Transformational Acquisition C Transaction Structure D Investment Rationale E Annexure – KPCL Overview
Slide 3: Adani Group portfolio
Adani Adani Transport & Logistics Energy & Utility Portfolio Portfolio • Marked shift from B2B to B2C businesses– 63.5% 100% 75% 75% • AGL – Gas distribution network to serve key APSEZ SRCPL ATL AGEL geographies across India Port & Logistics Rail T&D Renewables • AEML – Electricity 100% 75% 37.4% di
Slide 4: Adani infrastructure development lifecycle and performance
Phase Development Operations Post Operations Origination Site Development Construction Operation Capital Mgmt Analysis & Site acquisition Engineering & Life cycle O&M Redesigning the market design planning capital structure of Activity intelligence Concessions Asset the asset and regulatory Sourcing
Slide 5: Successfully applied across infrastructure and utility platform
Successfully applied across Infrastructure & utility platform Development at large scale & within time and budget India’s Largest Longest Private HVDC 6 4 8 MW Ultra Mega Largest Single Location Commercial Port Line in Asia Solar Power Plant Private Thermal IPP (at Mundra) (Mundra – Dehgam) (at Kamu
Slide 6: APSEZ: Ports, Logistics and SEZ
Ports Logistics SEZ • Ten operating Ports, ~490 MMT • Largest integrated logistics player • Large scale ‘ready to setup’ of augmented capacity in India. in India. industrial land (SEZ) • Hinterland reach of >80% • Operating 60+ rakes, 5 IFTs and • Land Bank of~ 13,000 ha. at • Targeting East and Wes
Slide 7: Agenda
A Group Profile B KPCL a Transformational Acquisition C Transaction Structure D Investment Rationale E Annexure – KPCL Overview
Slide 8: APSEZ port network, 10 operating ports
West Coast East Coast Capacity 327 MMT Capacity 163 MMT FY06 FY21 Dahej 14 MMT Tuna 1 Port 12 * 14 MMT 10 MMT Capacity 490 MMT Mundra 264 MMT Dhamra Hazira 45 MMT 30 MMT Vizag Capacity Mundra - India’s Largest 6 MMT Commercial Krishnapatnam 66% 54% 67% Port by 64 MMT FY15 8% FY20 Volume 92% Kattupal
Slide 9: APSEZ adds 12th port in its portfolio
Second largest private port asset with residual concession life of 40 years Enhances east coast west coast parity Transformational Complements APSEZ’s existing network and consolidate customer base asset East coast traffic to cross > 100 MMTPA by FY22 Accelerate the journey of APSEZ to ach
Slide 10: Agenda
A Group Profile B KPCL a Transformational Acquisition C Transaction Structure D Investment Rationale E Annexure – KPCL Overview
Slide 11: Pre- and post-acquisition shareholding and valuation
Pre-Acquisition Shareholding Post-Acquisition Shareholding CVR Group Cos. Strategic Port Continuing and family – Investment KPC APSEZ – 75% Promoter - 25% 90.6% Ltd. (3i Grp) – 9.4% KPCL KPCL Jan’ 20* Oct ‘20 Enterprise Value of INR 12,000 cr. and expected At FY 19 EBITDA INR 1,330 Cr. with multiple
Slide 12: Agenda
A Group Profile B KPCL a Transformational Acquisition C Transaction Structure D Investment Rationale E Annexure – KPCL Overview
Slide 13: Operational efficiencies identified by APSEZ already resulting in tangible benefits
Revenue upliftment • Benchmarking with other ports on tariff structure Bagging & dispatch • New contractor appointed at economical rates Tug hiring, • Rates renegotiated and benchmarked with other APSEZ O&M and ports on east coast. Fuel procurement • Alternative vendors for spares selected on compet
Slide 14: APSEZ's credit rating helps reduce financing cost for KPCL
• Current debt refinanced and replaced by proceeds from APSEZ US$ Bond. Interest Saving • Interest cost savings in constant rupee terms is around 6% p.a. aggregating to over Rs.350 cr. p.a. • Interest cost saving on hedged basis 2% p.a. aggregating to Rs.125 cr. p.a. • Utilization of existing tax lo
Slide 15: Focus areas for business improvement
FY20 FY21 FY22 FY23 Focus areas for business improvement Steps in FY21 Steps in FY22 Steps in FY23 onwards Operational Efficiency Operational Efficiency Ongoing Value Addition • Debottlenecking • Mechanization • Marketing efforts to • Process optimization increase sticky cargo Capacity – 64 MMT Carg
Slide 16: Cargo diversification
Diversification of cargo basket 2 2 2 4 9 9 6 14 FY20 FY21 FY22 FY23 (40) 7 (54) (70) (48) 5 40 6 31 27 36 12 Cargo in MMT Cargo diversification through : • Harnessing long term relationships with ship liners to increase container volume by offering them multiple entry and exit points at a pan India
Slide 17: Margin improvement locked in basis H1 FY21 performance
FY20 FY21 FY23 Operational Business Evolution Execution Focus Cargo Growth Efficiency 627 436 Cargo Growth 2,243 Margin 1,180 Improvement FY20 MI* - 14% Cargo Increment FY23 Margin improvement locked in basis H1 FY21 performance 17 #Unaudited for FY20 | * MI – Margin Improvement
Slide 18: Land bank with port capacity expansion possibilities
Land Bank with Port Area in Acres Total Land in Possession 4,621 Additional land allotted by Govt. & to be acquired 2,169 Total Land for the Port 6,790 Capacity Expansion Possibilities MMPTA Existing Capacity 64 Debottlenecking plans and overhauling of operations with 100 addition of equipments and
Slide 19: Benefits at APSEZ and KPCL
At APSEZ ~2x Cargo by 2025 • Diversification of cargo, coast and customer base 48 to 100 MMT • De-risks the portfolio of concentration and volatility • Hinterland reach increases to 90% ~1.5x Revenue by 2023 • New routes for Adani Logistics Rs.20 Bn to Rs.30 Bn At KPCL ~2x EBITDA by 2023 • Cargo thr
Slide 20: Agenda
A Group Profile B KPCL a Transformational Acquisition C Transaction Structure D Investment Rationale E Annexure – KPCL Overview
Slide 21: Krishnapatnam Port – Strategic Location
Krishnapatnam Port – Strategic Location • Krishnapatnam Port is a deep water port, located on east coast of India in Nellore District of Andhra Pradesh. (~ 180 km north of the Chennai Port). Visakhapatnam Port • Multipurpose port with 18.5 m draft & 13 berths - current Telangana Gangavaram Port capa
Slide 22: Road and rail connectivity and hinterland
• Hinterland of KPCL port - Central & Southern Andhra Pradesh, Telangana and Eastern Karnataka. • Port caters to thermal power, cement plants & edible oil refinery cluster. • Attracts export commodities like Agri, cement, minerals, fish products (reefer), etc. through container cargo • Dedicated fou
Slide 23: Cargo performance and diversification
Cargo Performance (MMT) Cargo diversification from coal to container 54.4 1.4 48.1 Coal Cargo Share Containers 45.3 8.5 1.5 1.6 36.1 9.1 5% 35.0 7.5 10.9 19% 17% 18% 1.3 1.4 7.0 1.8 4.1 7.9 4.7 4.4 FY16 Coal FY20 Coal 33.6 30.5 27.2 26.2 28.2 78% 63% FY'16 FY'17 FY'18 FY'19 FY'20 Coal Other Dry Cont
Slide 24: Key customers by cargo
Name Vol. in MMT Name Vol. in MMT Coal Edible Oil TPCIL/Sembcorp Energy 10.2 Emami Agrotech Ltd 0.4 JSW Group 4.1 South India Krishna Oil and Fats Pvt. Ltd 0.3 Karam Chand Thapar and Bros 2.6 Gemini Edibles Oil and Fats (I) Ltd 0.3 Swiss Singapore India Pvt.Ltd 1.4 Adani Wilmar Limited 0.2 Global Co
Slide 25: Analysis of financial performance
FY20 Year Units FY17 FY18 FY19 (unaudited) Cargo MMT 36 45 54 48 Revenue INR Cr. 1,755 1,969 2,334 2,031 EBIDTA INR Cr. 956 1,093 1,214 1,179 EBIDTA % 55% 56% 52% 58% INR/MT Analysis of Financial Performance FY20 Year Units FY17 FY18 FY19 (unaudited) Revenue PMT 486 435 429 422 EBIDTA PMT 265 241 22
Slide 26: Residual concession life of 40 years
Particulars Details Concession is for 30 years from COD with automatic extension of 2 blocks of 10 years each. Concession starts from March 2009 Concession will end in March 2059 Year % of Gross Revenue March 2009 to February 2039 2.6% March 2040 to February 2049 5.2% March 2050 to February 2059 10.
Slide 27: Port infrastructure and connectivity strengths
Port Infrastructure • All weather, deep draft port capable of handling all types of vessels including Capesize Vessels; Mechanized Handling • Mechanized coal handling system resulting in faster turnaround time of vessels; Extensive captive cargo • 5,490 MW of operational coal based power plant & 800
Slide 28: Investor Relations Team and 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 Adani Ports and Special Economic Zone Limited (“APSEZL”),the future outlook and growth prospect
Slide 29: Thank You
Krishnapatnam Port Transformational Acquisition 5th October, 2020 Thank You
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