Godawari Power & Ispat Ltd. · NSE:GPIL
Godawari Power & Ispat — Q2 FY2021 Earnings Presentation
42 slides from Godawari Power & Ispat's earnings presentation, Nov 5, 2020
Slide 1: Exchange filing cover letter for Q2FY21 presentation
~lfi<:'I~qft3ffi ~IRA-- REF: GPILINSE & BSE/20~~¥~WARI POWER & ISPAT Date: 05.11.2020 To, 1. The Listing Department, 2. The Corporate Relation Department, The National Stock Exchange of India Ltd, The BSE Limited, Exchange Plaza, Bandra Kurla Complex, First Floor, Rotunda Building, Bandra (E), Mumba
Slide 2: Q2FY21 Earnings Presentation
Godawari Power & Ispat Limited Q2FY21 Earnings Presentation November 2020 1
Slide 3: Disclaimer
Disclaimer This presentation and the accompanying slides (the “Presentation”), which have been prepared by Godawari Power and Ispat Limited (the “Company”) solely for the information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, a
Slide 4: Best Quarter in the Company's History
Best Quarter in the Company’s History driven by strong Q2FY21: Operating and Financial Performance COMPARISON WITH PREVIOUS BEST ON STANDALONE BASIS Highest Ever Quarterly Production/Sales (in MT) Pellet Production Pellet Sales Sponge Iron Steel Billet 4,24,494 6,17,300 1,00,660 5,77,350 1,52,406 4,
Slide 5: Q2FY21: Strong Performance amid uncertain environment
Q2FY21: Strong Performance amid uncertain environment PREVIOUS BEST VS CURRENT CONSOLIDATED BASIS Best Quarterly Financial Performance (in Mn) Sales EBITDA PBT 1,556 9,668 2,352 9,028 2,146 1,198 Q3FY19 Q2FY21 Q3FY19 Q2FY21 Q3FY19 Q2FY21 PAT Debt Repayment 1,038 1,028 2,720 900 Q4FY18 Q2FY21 Q1FY21
Slide 6: Q2FY21: Operating & Financial Highlights
Q2FY21: Operating & Financial Highlights Consolidated Operational Highlights Production & Sales were higher across segments on account of improvement in domestic demand and realisation Export of value added products (wire rods) commenced Operations normalised and back to pre covid levels; curr
Slide 7: Strategic Stake Sale in Ardent Steel
Strategic Stake Sale in Ardent Steel Ardent Steel EBITDA (INR Mn) Transaction Overview 1,013 o GPIL and its step down subsidiary Hira Energy will sell 915 c.42% stake in Ardent Steel Limited (ASL) to Transtek Coal 764 & Minerals Pvt. Ltd. for a cash consideration of INR 95 cr o The Deal values Arden
Slide 8: Clear Strategic Priorities
Clear Strategic Priorities Near Term Priorities and Targets Long Term Roadmap Deleveraging and Balance Sheet Improvement • Free cash flow from operation to be utilized towards Integration of Iron Ore and Mining Assets deleveraging, • Post De-leveraging, the company intends to add steel • Cash flows
Slide 9: Long Term Debt Reduced by 50% in last 3 Years
Long Term Debt Reduced by 50% in last 3 Years Paid c2x times over Repaid c2x times over Repaid c4x times over All figures in INR MN the scheduled the scheduled debt the scheduled debt repayment in FY19 repayment in FY20 repayment of FY21 in H1 Debt Repayment Schedule GPIL (Standalone) ASL GGE 3,660
Slide 10: Financial & Operational Impact of COVID-19
Financial & Operational Impact of COVID-19 Operational Impact • Manufacturing operations were temporarily shut in steel business from 24th March to 9th April steps were taken to restart the operations • Plants reached to near normal capacity by 3rd week of May 2020. Continues to operate over 90% uti
Slide 11: Q2FY21 Production Summary
Q2FY21 Production Summary Production (in MT) Q2FY21 Q1FY21 QoQ (%) Q2FY20 YoY (%) H1FY21 H1FY20 FY20 Iron ore Mining 4,19,657 3,21,807 30% 3,07,286 37% 7,41,464 7,56,200 16,57,629 Iron ore Pellets - GPIL 6,17,300 4,64,150 33% 5,04,100 22% 10,81,450 9,80,800 19,99,150 Iron Ore Pellets - ASL 1,01,354
Slide 12: Q2FY21 Sales Volume Summary
Q2FY21 Sales Volume Summary Sales Volume (in MT) Q2FY21 Q1FY21 QoQ (%) Q2FY20 YoY (%) H1FY21 H1FY20 FY20 Pellet - GPIL - Domestic 89,793 18,751 379% 1,07,194 -16% 1,08,544 2,93,326 6,39,219 Pellet - GPIL - Export 3,34,701 3,61,550 -7% 2,56,410 31% 6,96,251 3,96,101 7,23,077 Pellet - ASL 1,09,967 1,8
Slide 13: Q2FY21 Realisation Summary
Q2FY21 Realisation Summary Realisation Q2FY21 Q1FY21 QoQ (%) Q2FY20 YoY (%) H1FY21 H1FY20 FY20 Iron Ore Pellet - GPIL* 7,059 6,125 15% 6,605 7% 6,617 6,486 6,259 Iron Ore Pellet - ASL 5,817 5,643 3% 5,925 -2% 5,709 5,811 5,600 Sponge Iron 17,854 15,100 18% 16,043 11% 17,374 16,832 16,897 Steel Bille
Slide 14: GPIL Consolidated - Profit & Loss
GPIL Consolidated - Profit & Loss Particulars (in Mn) Q2FY21 Q1FY21 QoQ (%) Q2FY20 YoY (%) H1FY21 H1FY20 FY20 Net Sales 9,668 7,113 36% 8,279 17% 16,780 16,621 32,885 Total Expenses 7,323 5,535 32% 6,623 11% 12,858 13,216 26,643 Other Income 7 11 -32% 16 -54% 18 28 47 EBITDA 2,352 1,588 48% 1,672 41
Slide 15: GPIL Standalone - Profit & Loss
GPIL Standalone - Profit & Loss Particulars (in Mn) Q2FY21 Q1FY21 QoQ (%) Q2FY20 YoY (%) H1FY21 H1FY20 FY20 Net Sales 8,765 5,740 53% 6,803 29% 14,504 14,082 27,740 Total Expenses 6,765 4,776 42% 5,692 19% 11,542 11,698 23,340 Other Income 5 9 -42% 9 -41% 14 20 29 EBITDA 2,004 972 106% 1,120 79% 2,9
Slide 16: Ardent Steel Limited Standalone - Profit & Loss
Ardent Steel Limited Standalone - Profit & Loss Particulars (in Mn) Q2FY21 Q1FY21 QoQ (%) Q2FY20 YoY (%) H1FY21 H1FY20 FY20 Net Sales 636 1,020 -38% 1,273 -50% 1,656 2,007 4,171 Total Expenses 505 721 -30% 908 -44% 1,225 1,467 3,165 Other Income 0 0 300% 0 0% 1 1 7 EBITDA 132 300 -56% 365 -64% 432 5
Slide 17: Godawari Green Energy Limited - Profit & Loss
Godawari Green Energy Limited - Profit & Loss Particulars (in Mn) Q2FY21 Q1FY21 QoQ (%) Q2FY20 YoY (%) H1FY20 H1FY20 FY20 Net Sales 271 367 -26% 213 28% 638 553 1,003 Total Expenses 57 52 9% 35 65% 109 74 163 EBITDA 214 315 -32% 178 20% 529 480 840 EBITDA Margin (%) 79% 86% 84% 83% 87% 84% Other Inc
Slide 18: GPIL Standalone – Balance Sheet
GPIL Standalone – Balance Sheet Particulars 30.09.2020 31.03.2020 Particulars 30.09.2020 31.03.2020 ASSETS EQUITY AND LIABILITIES Non Current assets EQUITY (a) Property, Plant and Equipment 13,303 13,689 (a) Equity share capital 341 341 (b) Capital work-in-progress 621 529 (b) Other equity 12,816 11
Slide 19: GPIL Consolidated – Balance Sheet
GPIL Consolidated – Balance Sheet Particulars 30.09.2020 31.03.2020 Particulars 30.09.2020 31.03.2020 ASSETS EQUITY AND LIABILITIES Non Current assets EQUITY (a) Property, Plant and Equipment 21,050 21,646 (a) Equity share capital 341 341 (b) Capital work-in-progress 1,476 1,375 (b) Other equity 14,
Slide 20: TTM H1FY21 Return & Liquidity Ratios
TTM H1FY21 Return & Liquidity Ratios Unit Standalone Ardent GGEL Consolidated RoE % 33% 22% 2% 33% RoCE % 17% 30% 10% 14% BVPS INR 373 - - 474 Net Debt to EBITDA x 1.81 0.47 3.95 1.93 Net Debt to Equity x 0.69 0.20 1.36 0.78 Interest Coverage x 3.61 9.04 2.05 3.55 * TTM Basis 19
Slide 21: International & Domestic Tailwinds
International & Domestic Tailwinds International Market o Iron ore prices have climbed from a low of US$ 80/t seen in April’20 to US$ 128/t, almost touching two year high. Iron ore prices remained well supported despite global players returning to production and maintaining their guidance. Demand fr
Slide 22: Godawari Power & Ispat Limited
Godawari Power & Ispat Limited INVESTOR PRESENTATION
Slide 23: Integrated Asset Portfolio; Unique Presence Across Steel Value Chain
Integrated Asset Portfolio; Unique Presence Across Steel Value Chain Asset Capacity FY20 Utilisation (%) Asset Capacity FY20 Utilisation (%) Iron Ore MS 0.4 mt Mining 2.1mt 76% Rounds 85% 46% 64% Iron Ore 92% HB 0.15 mt 90% 2.8 mt 96% Pellets Wires 87% Sponge 93% Ferro 16,500 mt 0.5 mt 99% Alloys Ir
Slide 24: GPIL – Focused on Generating Shareholder Value
GPIL – Focused on Generating Shareholder Value Balance Sheet De- Clear Strategy Portfolio Optimisation Improving Financials Leveraging Increasing value addition TTM H1FY21 Net Debt to equity Reduced to Focus on Integrated Steel by enhancing captive Revenue Flat YoY 0.8x from 3x in 2017; Target Value
Slide 25: Increased Captive Consumption Provides Significant Margin Expansion
Increased 24 Captive Consumption Provides Significant Margin Expansion Significant captive mining capacity aid in lowering costs & improving margins Iron Ore Production (MT) Captive Mining Started • Increased captive mining to aid in lowering cost and operations at improving margins. Started Boria T
Slide 26: Captive Mining Leading To Huge Raw Material Costs Saving
Captive Mining Leading To Huge Raw Material Costs Saving 6,200 4,346 4,270 4,400 3,500 3,200 3,000 2,750 2,600 2,462 2,181 2,310 2,250 2,200 2,050 1,800 FY15 FY16 FY17 FY18 FY19 FY20 Q1FY21 Q2FY21 Market Price of Iron Ore Captive Ore Landed Cost 25
Slide 27: Focussed on Value Creation: Net Debt Reducing & FCF increasing
Focussed on Value Creation: Net Debt Reducing & FCF increasing All figures in INR MN Net Debt to Equity 2.5x 1.9x 1.4x 1.1x 0.8x 4,000 21,634 3,051 22,000 3,000 20,715 1,909 1,731 20,000 2,000 1,051 18,467 1,000 18,000 - 16,678 16,000 -1,000 -2,000 14,000 -3,162 13,090 -3,000 12,000 -4,000 FY17 FY18
Slide 28: Improving Liquidity Ratios
Improving Liquidity Ratios 5,508 5,498 5,508 4,511 3,771 4,121 Cash Flows from 3,140 Operation 2,581 1,699 1,657 Capex 716 1,063 827 556 146 170 Free Cash Flows FY14 FY15 FY16 FY17 FY18 FY19 FY20 H1FY21 Net Debt to EBITDA Net Debt to Equity 2.75 9.87 2.54 8.09 8.14 2.132.05 1.911.94 7.07 1.381.27 1.
Slide 29: Group Structure
Group Structure Associates JVs Godawari Power and Ispat Ltd. 48.45% 33.30% Hira Ferro Alloys Raipur Ltd. Infrastructure Co 76.12% 37.85%* Godawari Green 25.93% Ardent Steel Ltd. Energy Ltd. Chattisgarh Captive Coal Mining 51.30% 33.96% 35.36% Godawari Energy Ltd. Chhattisgarh Ispat Jagdamba Power &
Slide 30: Large Portfolio of Long-life Assets
Large Portfolio of Long-life Assets Pelletisation Plant Odisha Solar Thermal Power Plant Keonjhar: 0.69 mn MTPA Rajasthan: 50MW Siltara Integrated Plant Chhattisgarh 1 mn MTPA Iron ore beneficiation 2.1 mn MTPA Iron ore pellets 0.5 mn MTPA Sponge iron 0.4 mn MTPA Steel billets 0.1 mn MTPA HB wire 73
Slide 31: Shareholding Pattern as on September 2020
Shareholding Pattern as on September 2020 Shareholding Pattern Break up of Shareholding Pattern Shareholding % of Total Sh. Institution 0.20% 32.58% Non Institution 32.29% Total 32.50% 67.42% Promoter Shareholding % of Total Sh. Pledge* 32.51% Total 67.50% Promoter Public * Pledged with lenders as a
Slide 32: Board of Directors
Board of Directors Mr Biswajit Choudhary (Chairman & Mr BL Agarwal Independent Director) Managing Director 5 decades of experience in • 1st generation entrepreneur with Engineering, Banking & Finance; almost 4 decades of experience; Mechanical Engineering from IIT, Graduated as an electronic; Kharag
Slide 33: Board of Directors
Board of Directors Mr. Siddharth Agrawal Mr. Harishankar Khandelwal (Non-Executive Director) (Independent Director) Managing Director of subsidiary Almost 3 decades of experience in Godawari Green Energy Limited ; corporate planning & strategy, MBA with over 10 years of financial analysis, budgeting
Slide 34: Subsidiary | Godawari Green Energy
Subsidiary | Godawari Green Energy Operating Performance o Facility located in village Naukh, Jaisalmer, 103 23% 97 22% 19% 91 85 21% Rajasthan 91 86 75 81 o GGEL has been set up to implement project awarded under Jawaharlal Nehru National Solar Mission, Phase I of Govt. of India o The first plant t
Slide 35: Subsidiary | Ardent Steel
Subsidiary | Ardent Steel Operating Metrics 6,053 o The company has a total production capacity of 0.69 mn 5,600 4,932 5,050 100% MTPA pellet which located in Phuljhar, Keonjhar, Odisha 97% 95% o The plant uses iron ore from the merchant mines in Barbil, located in the Keonjhar district 50% o The de
Slide 36: GPIL Standalone – Past Operational Performance at a Glance
GPIL Standalone – Past Operational Performance at a Glance... Trend of Iron Ore Mining (mt) Trend of Pellets Production (mt) 16,57,629 15,79,693 15,47,384 19,33,250 19,99,150 18,41,050 11,75,090 15,32,200 15,80,850 14,95,100 6,57,328 9,02,550 4,44,695 3,26,358 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 FY2
Slide 37: GPIL Standalone – Past Operational Performance at a Glance
GPIL Standalone – Past Operational Performance at a Glance... Trend of Steel Production (mt) Silico Manganese (mt) 3,44,610 2,98,418 13,700 13,772 13,136 11,116 11,403 10,537 10,517 2,27,581 2,04,162 1,97,596 1,88,190 1,77,970 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 FY20 FY 14 FY 15 FY 16 FY 17 FY 18 FY
Slide 38: Past Sales Realisations
Past Sales Realisations Iron ore Pellet Sponge Iron 19,736 7,872 18,934 7,798 18,277 7,091 16,678 16,897 6,809 5,365 13,310 5,067 12,383 4,360 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 Steel Billets 33,072 29,493 28,681 28,590 27,720 22,689 21,830 FY 14 FY 15 FY
Slide 39: Past Sales Realisations
Past Sales Realisations M.S. Round H.B. Wire 38,740 40,666 33,265 33,409 33,327 32,460 36,169 34,683 35,182 34,015 27,034 26,330 28,080 28,063 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 Silico Manganese 67,611 64,632 63,898 53,365 52,696 51,665 43,139 FY 14 FY 15
Slide 40: GPIL Consolidated – Historical Profit & Loss
GPIL Consolidated – Historical Profit & Loss Particulars (in Million) FY20 FY19 FY18 FY17 Net Sales 32,885 33,216 25,274 19,941 Total Expenses 26,643 25,323 19,305 17,033 Other Income 47 58 87 153 EBITDA 6,289 7,952 6,056 3,061 EBITDA Margin (%) 19% 24% 23% 15% Depreciation 1,369 1,329 1,318 1,201 F
Slide 41: GPIL Consolidated – Historical Balance Sheet
GPIL Consolidated – Historical Balance Sheet Particulars (INR mn) FY20 FY19 FY18 FY17 Net Worth 15,026 13,364 10,837 8,503 Non-Controlling Interest 1,773 1,672 1,604 1,533 Debt Long Term Debt 14,645 16,431 18,730 19,799 Short Term Debt 1,604 1,393 1,344 1,955 Other Long Term Liabilities 605 127 103
Slide 42: Thank you
Thank you Investor Relations Contact: Company Contact: Ankit Toshniwal Govind Jaju Go India Advisors Godawari Power and Ispat Ltd. ankit@GoIndiaAdvisors.com govind.jaju@hiragroup.com M:+91 90224 80789 M:+91 98922 53901 41
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