Godawari Power & Ispat Ltd. · NSE:GPIL
Godawari Power & Ispat — Q3 FY2020 Earnings Presentation
41 slides from Godawari Power & Ispat's earnings presentation, Feb 12, 2020
Slide 1: Exchange filing cover letter
---1-11 RA-- GODAWARI POWER & ISPAT REF: GPILINSE & BSE/2020/4075 Date: 11..02.2020 To, The Listing Department, 2.The Corporate Relation Department The National Stock Exchange of India Limited, The BSE Limited, Mumbai, Exchange Plaza, Bandra Kurla Complex, 1st Floor, Rotunda Building, Bandra (E), Mu
Slide 2: Q3 & 9M FY20 Earnings Presentation
Q3 & 9M FY20 Earnings Presentation February 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: Q3 FY20 Strategic Update
Q3 FY20 Strategic Update Operations • Captive mines fully integrated at standalone operations. • Operating at higher capacities leading to incrementally higher EBITDA. • EBITDA in Q3FY20 dropped on account of substantially lower sales realisation. Received Environmental Clearance for: • Rolling mill
Slide 5: Q3 FY20 Operational & Financial Highlights
Q3 FY20 Operational & Financial Highlights Captive Iron Ore: 16% higher at 449,554 MT Pellet: 24% higher at 770,525 MT Q3FY20 Sponge Iron: 10% higher at 124,572 MT Operational Steel billets: 9% higher at 91,785 MT (Volume) MS rounds: 4% higher at 48,893 MT Highlights* HB wires: 16% highe
Slide 6: Shareholding Pattern as on December 2019
Shareholding Pattern as on December 2019 Shareholding Pattern Break up of Shareholding Pattern Public Shareholding % of Total Sh. HSBC Global 3.62% Others 29.02% 32.64% Total 32.64% 67.36% Promoter Shareholding % of Total Sh. Pledge* 32.57% Total 67.36% Promoter Public * Pledged with lenders as an a
Slide 7: Q3FY20 Production Summary
Q3FY20 Production Summary Production (in MT) Q3FY20 Q3FY19 YoY (%) Q2FY20 QoQ (%) 9MFY20 9MFY19 YoY (%) Iron ore Mining 4,49,554 3,87,657 16% 3,07,286 46% 12,05,754 11,11,331 8% Iron ore Pellets - GPIL 5,77,350 4,35,300 33% 5,04,100 15% 15,58,150 13,93,250 12% Iron Ore Pellets - ASL 1,93,175 1,86,51
Slide 8: Q3FY20 Sales Volume Summary
Q3FY20 Sales Volume Summary Sales Volume (in MT) Q3FY20 Q3FY19 YoY (%) Q2FY20 QoQ (%) 9MFY20 9MFY19 YoY (%) Iron Ore Pellet - GPIL 3,83,680 3,14,395 22% 3,63,604 6% 10,73,107 10,50,779 2% Iron Ore Pellet - ASL 1,94,365 1,68,558 15% 2,15,129 -10% 5,37,977 4,00,220 34% Sponge Iron 29,888 22,846 31% 49
Slide 9: Q3FY20 Realisation Summary
Q3FY20 Realisation Summary Realisation Q3FY20 Q3FY19 YoY (%) Q2FY20 QoQ (%) 9MFY20 9MFY19 YoY (%) Iron Ore Pellet - GPIL* 5,742 7,502 -23% 6,617 -13% 6,220 6,635 -6% Iron Ore Pellet - ASL* 4,803 7,163 -33% 5,609 -14% 5,257 6,056 -13% Sponge Iron 15,969 19,698 -19% 16,043 0% 16,611 20,083 -17% Steel
Slide 10: GPIL Consolidated - Profit & Loss
GPIL Consolidated - Profit & Loss Particulars (in Mn) Q3FY20 Q3FY19 YoY (%) Q2FY20 QoQ (%) 9MFY20 9MFY19 YoY (%) Net Sales 8,368 9,028 -7% 8,279 1% 24,985 24,273 3% Total Expenses 7,082 6,893 3% 6,623 7% 20,298 18,257 11% Other Income 38 11 258% 16 143% 70 29 141% EBITDA 1,323 2,146 -38% 1,672 -21%
Slide 11: GPIL Standalone - Profit & Loss
GPIL Standalone - Profit & Loss Particulars (in Mn) Q3FY20 Q3FY19 YoY (%) Q2FY20 QoQ (%) 9MFY20 9MFY19 YoY (%) Net Sales 7,168 7,533 -5% 6,803 5% 21,246 21,092 1% Total Expenses 6,228 6,061 3% 5,692 9% 17,926 16,408 9% Other Income 30 8 268% 9 243% 53 21 160% EBITDA 970 1,480 -34% 1,120 -13% 3,373 4
Slide 12: Ardent Steel Limited Standalone - Profit & Loss
Ardent Steel Limited Standalone - Profit & Loss Particulars (in Mn) Q3FY20 Q3FY19 YoY (%) Q2FY20 QoQ (%) 9MFY20 9MFY19 YoY (%) Net Sales 1,007 1,257 -20% 1,273 -21% 3,013 2,485 21% Total Expenses 796 779 2% 908 -12% 2,262 1,723 31% Other Income 0 0 100% 0 -50% 1 1 -52% EBITDA 211 478 -56% 365 -42% 7
Slide 13: Godawari Green Energy Limited - Profit & Loss
Godawari Green Energy Limited - Profit & Loss Particulars (in Mn) Q3FY20 Q3FY19 YoY (%) Q2FY20 QoQ (%) 9MFY20 9MFY19 YoY (%) Net Sales 193 238 -19% 213 -9% 746 700 7% Total Expenses 49 52 -6% 35 42% 123 130 -6% EBITDA 144 189 -24% 178 -19% 624 570 9% EBITDA Margin (%) 75% 79% 84% 84% 81% Other Incom
Slide 14: Q2FY20 Return & Liquidity Ratios
Q2FY20 Return & Liquidity Ratios Unit Standalone Ardent GGEL Consolidated RoE* % 12% 34% 3% 14% RoCE* % 17% 31% 8% 17% BVPS INR 343 - - 420 Net Debt to EBITDA* x 2.46 0.91 4.71 2.46 Net Debt to Equity x 1.02 0.46 1.62 1.14 Interest Coverage* x 3 6.35 1.82 3.18 *TTM Basis 13
Slide 15: Business Strategy Going Forward
Business Strategy Going Forward Efforts Towards Greater Operational Efficiencies Jagdamba (power division) merger proposed (25 MW) • Billet production increased through long term supply of power from Jagdamba. Rolling Mill Update • Aiming towards 100% captive utilisation of sponge iron for increased
Slide 16: Domestic Tailwinds
Domestic Tailwinds International Market o Steel prices corrected quite sharply in Q3 to a low of US$420/t but saw a “V” shaped recovery by Jan’20 to US$538/t. Steel prices have seen minor correction recently due to Corona virus outbreak and subsequent demand disruption. o Short term price outlook wi
Slide 17: Outlook on Global Steel Demand
Outlook on Global Steel Demand Crude Steel Production (in MT) 1,790 1,730 1,650 1,669 1,620 1,627 1,538 1,560 1,433 1,390 1,348 1,343 1,250 1,239 1,148 1,063 971 905 850 852 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019* *Data until September 201
Slide 18: Domestic Demand Outlook
Domestic Demand Outlook Total Crude Steel Production (million tonnes) Total Finished Steel Production (million tonnes) 6.4% CAGR 2.33% CAGR 106.56 103.13 131.72 126.86 97.95 120.14 104.578 89.79 88.98 106.6 81.69 78.42 74.29 70.67 65.84 58.44 53.86 FY19P FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16
Slide 19: Investor Presentation
HIRA- GODAWARI POWER & ISPAT INVESTOR PRESENTATION
Slide 20: Integrated Asset Portfolio; Unique Presence Across Steel Value Chain
Integrated Asset Portfolio; Unique Presence Across Steel Value Chain Asset FY 19 Utilisation Asset Capacity FY19 Utilisation Capacity Iron Ore MS 0.2 mt 2.1 mt Mining 77% Rounds 85% HB 0.15 mt Iron Ore 2.7 mt 92% Wires 90% Pellets Sponge Ferro 16,500 mt 0.5 mt 93% Alloys 64% Iron Steel Power 98 MW*;
Slide 21: GPIL – Focused on Generating Shareholder Value
GPIL – Focused on Generating Shareholder Value Portfolio Improving Balance Sheet De- Clear Strategy Optimisation Financials Leveraging Increasing value FY19 Revenue Net Debt to equity Focus on Integrated addition by enhancing Growth: 31%; Reduced to 1.4x from Steel Value Chain captive power EBITDA M
Slide 22: Strategy Focused on Consistent Profitability
Strategy Focused on Consistent Profitability All numbers in INR Mn EBITDA INR Mn 2.6x 7,952 6,056 4,757 3,061 2,360 FY16 FY17 FY18 FY19 9MFY20 Based on consolidated numbers 21
Slide 23: Increased Captive Consumption Provides Significant Margin Expansion
Increased Captive Consumption Provides Significant Margin Expansion Significant captive mining capacity & multiple long-term linkages aid in lowering costs & improving margins Iron Ore Production (MT) Coal • Long-term linkage with Coal India to the extent of 75% of total requirement. Started operati
Slide 24: Captive Mining Leading To Huge Raw Material Costs Saving
Captive Mining Leading To Huge Raw Material Costs Saving 4,346 4,270 4150 3,850 3,500 3,200 3,000 2,750 2,600 2,537 2493 2,462 2,310 2,181 2,050 1,800 FY15 FY16 FY17 FY18 FY19 Q1FY20 Q2FY20 Q3FY20 Market Price of Iron Ore Captive Ore Landed Cost 23
Slide 25: Improving Liquidity Ratios
Improving Liquidity Ratios 5,508 5,498 4,511 3,771 Cash Flows from 3,140 2,934 Operation 2,581 Capex 1,699 1,063 827 817 Free Cash Flows 556 716 146 FY14 FY15 FY16 FY17 FY18 FY19 H1FY20 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 1.38 1.27 1.14 3.423.11 0.95
Slide 26: Incremental Cash Flows to be Utilised for De-Leveraging
Incremental Cash Flows to be Utilised for De-Leveraging All figures in INR MN Paid c2x times over Repaid c1.6x -1.7x of the scheduled scheduled debt Debt Repayment Schedule repayment in FY19 repayment of FY20 in 9M GPIL (Standalone) ASL GGE 2,430 1,636 1,303 1,123 330 255 65 1,032 49 1,161 255 25 25
Slide 27: Long Term Debt Reduction
Long Term Debt Reduction All figures in INR MN 17,481 17,080 1,089 16,441 1,082 15,845 920 766 4,468 4,369 4,263 4,166 11,924 11,630 11,258 10,913 FY19 Q1FY20 Q2FY20 Q3FY20 GPIL GGEL ASL 26
Slide 28: FY20: Three-Pronged Strategy to Drive Growth
FY20: Three-Pronged Strategy to Drive Growth Focus on Value Asset Optimisation De-leveraging Addition o Increasing o Billet capacity o Incremental free capacity utilisation to cash flows to be used utilisation improve to 90%+ for debt reduction across value o Commissioning of o Gross Debt to be chai
Slide 29: Group Structure
Group Structure Associates JVs Godawari Power and Ispat Ltd. 48.45% 33.30% Hira Ferro Alloys Raipur Infrastructure Ltd. Co 76.12% 76.34% 25.93% Godawari Green Ardent Steel Ltd. Energy Ltd. Chattisgarh Captive Coal Mining 51.30% 33.96% 35.36% Godawari Energy Ltd. Jagdamba Power & Chhattisgarh Ispat A
Slide 30: Large Portfolio of Long-life Assets
Large Portfolio of Long-life Assets Pelletisation Plant Odisha Solar Thermal Power Plant Keonjhar: 0.6 mn MTPA Rajasthan: 50MW Siltara Integrated Plant Chhattisgarh 2.1 mn MTPA Iron pellets 0.5 mn MTPA Sponge iron 0.4 mn MTPA Steel billets 0.1 mn MTPA HB wire 73 MW power 25 MW power from JPL Ari Don
Slide 31: 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 32: Board of Directors
Board of Directors Mr. Dinesh Gandhi Mr. Shashi Kumar (Independent (Non-Executive Director) Director) 4+ decades of experience; B.Sc. In 3 decades of experience in Mining Engineering; Advisor to Accounts, Finance & Project NTPC, IFFCO & Chhattisgarh Power Financing; Chartered Accountant ltd Mr. B N
Slide 33: Subsidiary | Godawari Green Energy
Subsidiary | Godawari Green Energy Operating Performance 22% 23% 22% o Facility located in village Naukh, 103 97 98 85 Jaisalmer, Rajasthan 86 91 86 19% 75 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 34: Subsidiary | Ardent Steel
Subsidiary | Ardent Steel Operating Metrics o The company has a total production 5,050 6,053 4,932 95% capacity of 0.69 mn MTPA pellet which 3,914 97% located in Phuljhar, Keonjhar, Odisha o The plant uses iron ore from the 61% 50% merchant mines in Barbil, located in the Keonjhar district FY16 FY17
Slide 35: 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) 15,79,693 15,47,384 19,33,250 18,41,050 11,75,090 15,32,200 15,80,850 14,95,100 6,93,612 6,57,328 9,02,550 4,44,695 6,19,620 3,26,358 FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19
Slide 36: GPIL Standalone – Past Operational Performance at a Glance
GPIL Standalone – Past Operational Performance at a Glance... Trend of Steel Production (mt) Silico Manganese (mt) 2,98,418 13,700 13,772 13,136 11,116 11,403 2,27,581 10,537 9,434 2,04,162 1,97,596 1,85,021 1,88,190 1,77,970 FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 FY 13 FY 14 FY 15 FY 16 FY 17 FY
Slide 37: Past Sales Realisations
Past Sales Realisations Sponge Iron Iron ore Pellet 20,964 19,736 9,017 18,934 18,277 7,872 7,798 16,678 6,809 13,310 5,067 5,365 12,383 4,360 FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 Steel Billets 33,072 31,947 29,493 28,681 27,720 22,689 21,830 FY 13 FY 14
Slide 38: Past Sales Realisations
Past Sales Realisations M.S. Round H.B. Wire 38,740 35,373 40,666 33,265 33,409 32,460 38,332 36,169 34,683 34,015 27,034 26,330 28,080 28,063 FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 Silico Manganese 67,611 64,632 53,783 53,365 52,696 51,665 43,139 FY 13 FY
Slide 39: GPIL Consolidated – Historical Profit & Loss
GPIL Consolidated – Historical Profit & Loss Particulars (in Million) FY19 FY18 FY17 FY16 Net Sales 33,216 25,274 19,941 22,037 Total Expenses 25,323 19,305 17,033 19,866 Other Income 58 87 153 189 EBITDA 7,952 6,056 3,061 2,360 EBITDA Margin (%) 24% 23% 15% 11% Depreciation 1,329 1,318 1,201 1,265
Slide 40: GPIL Consolidated – Historical Balance Sheet
GPIL Consolidated – Historical Balance Sheet Particulars (INR mn) FY19 FY18 FY17 FY16 Net Worth 13,364 10,837 8,503 8,983 Non‐Controlling Interest 1,672 1,604 1,533 1,034 Debt Long Term Debt 16,431 18,730 19,799 13,660 Short Term Debt 1,393 1,344 1,955 3,408 Other Long Term Liabilities 127 103 82 66
Slide 41: Thank you
Thank you i SODA HIRA- | GODAWARI POWER & ISPAT ae
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