Grasim Industries Ltd. · NSE:GRASIM

Grasim Industries — Q2 FY2009 Earnings Presentation

47 slides from Grasim Industries's earnings presentation, Oct 23, 2008

  1. Slide 1: Grasim Industries Limited Performance Review Q2FY09

    Grasim Industries Limited Performance Review Q2FY09 23rd October 2008

  2. Slide 2: Cautionary Statement

    Cautionary Statement Statements in this “Presentation” describing the Company’s objectives, estimates, expectations or predictions may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or impl

  3. Slide 3: Consolidated Financial Performance – Q2FY09

    Consolidated Financial Performance – Q2FY09 %  Revenue up by 13% Rs. Crs. Change  PBIDT lower by 19%  Increase in input cost and energy prices across Revenue 4,489 13 businesses impacted profitability PBIDT 1,025 (19)  Interest up by 37% due to higher borrowings by Subsidiary & JV Interest 77 37

  4. Slide 4: Consolidated Financial Performance – H1FY09

    Consolidated Financial Performance – H1FY09 %  Revenue up by 11% Rs. Crs. Change  PBIDT lower by 10%  Increase in input cost and energy prices across Revenue 8,944 11 businesses impacted profitability PBIDT 2,383 (10)  Interest up by 27% due to higher borrowings by Subsidiary & JV Interest 146 2

  5. Slide 5: Consolidated Financial Performance

    Consolidated Financial Performance (Rs. Crores) Q2 FY09 Q2 FY08 % Chg. H1 FY09 H1 FY08 % Chg. FY08 Net Turnover & Op. Income 4,489.1 3,963.9 13 8,943.7 8,026.1 11 17,126.4 Other Income 68.2 66.2 3 138.1 151.5 (9) 310.2 PBIDT 1,024.8 1,269.5 (19) 2,383.1 2,640.8 (10) 5,428.7 Interest 77.2 56.4 37 145

  6. Slide 6: Standalone Financial Performance – Q2FY09

    Standalone Financial Performance – Q2FY09 %  Revenue up by 8% Rs. Crs. Change  PBIDT lower by 21% Revenue 2,701 8  Increase in input cost and energy prices across businesses impacted profitability PBIDT 679 (21)  Depreciation higher by 22%  Commissioning of projects Interest Charges 29 3  Down

  7. Slide 7: Standalone Financial Performance – H1FY09

    Standalone Financial Performance – H1FY09 %  Revenue up by 7% Rs. Crs. Change  PBIDT lower by 12% Revenue 5,317 7  Increase in input cost and energy prices across businesses impacted profitability PBIDT 1,513 (12)  Depreciation higher by 23%  Commissioning of projects Interest Charges 59 5  Do

  8. Slide 8: Standalone Financial Performance

    Standalone Financial Performance (Rs. Crores) Q2 FY09 Q2 FY08 % Chg. H1 FY09 H1 FY08 % Chg. FY08 Net Turnover & Op. Income 2,700.5 2,508.4 8 5,316.9 4,946.0 7 10,315.3 Other Income 84.4 47.5 78 142.6 113.1 26 277.6 PBIDT 678.8 863.1 (21) 1,513.1 1,722.9 (12) 3,424.5 Interest 28.8 28.0 3 59.3 56.4 5

  9. Slide 9: Segmental Performance – Q2FY09

    Segmental Performance – Q2FY09 Revenue Mix Consolidated PBIDT Mix Others VSF & Sponge Iron VSF & Others 3% Chemical 20% 7% Chemical 8% 21% Sponge Iron 3% Textiles 2% Cement 69% Cement 67% (Rs.4,489 Crs.) (Rs.1,025 Crs.) Revenue Mix Standalone PBIDT Mix Sponge Iron 11% VSF & Others 10% Chemical Spong

  10. Slide 10: Financial Highlights

    [GRA STM] Financial Highlights 10

  11. Slide 11: Grasim Consolidated Financials

    Grasim Consolidated Financials H1  Strong Balance sheet (Rs. Crores) FY06 FY07 FY08 FY09  Net worth at $2.2 Bn. Net Turnover 10,224 14,069 16,974 8,856  Capital Employed at $4.0 Bn. PBIDT 2,337 4,290 5,429 2,383  Debt-equity at 0.49 PAT#(After Minority share) 1,041 1,967 2,655 1,158  Net levera

  12. Slide 12: Grasim Standalone Financials

    Grasim Standalone Financials H1  Strong Balance sheet (Rs. Crores) FY06 FY07 FY08 FY09  Low gearing at 0.32 Net Turnover 6,653 8,572 10,215 5,263  Net gearing lower at 0.27 PBIDT 1,597 2,619 3,424 1,513  Comfortable interest cover PAT * 863 1,536 2,048 934  ROAvCE in H1FY09 at 26%, on Net Worth

  13. Slide 13: Business Review – Q2FY09

    Business Review – Q2FY09  VSF  Chemicals  Cement  Sponge Iron 13

  14. Slide 14: Viscose Staple Fibre: Q2FY09 Highlights

    Viscose Staple Fibre : Q2FY09 Highlights  Sales Volume impacted due to sluggish demand Q2FY09 Q2FY08 % Chg.  Global slowdown coupled with inflationary Capacity (TPA) 333,975 270,100 24 pressure impacted textile sector Production (MT) 62,973 69,678 (10)  Liquidation of inventory in the value chain

  15. Slide 15: Viscose Staple Fibre: Outlook

    Viscose Staple Fibre : Outlook  Demand expected to remain subdued in the short to medium term till improvement in Global economic situation  Domestic prices likely to remain at current levels  Margins expected to remain range bound  Lower volumes and high input costs  Sharp fall in sulphur pric

  16. Slide 16: Chemical: Q2FY09 Highlights & Outlook

    Chemical : Q2FY09 Highlights & Outlook  Quarterly performance at historical Q2FY09 Q2FY08 % Chg. high Caustic Capacity (TPA) 258,000 258,000 --  Sales volume up by 7% with higher Caustic Production (MT) 55,137 48,752 13 demand from end user industry, Caustic Sales Volumes (MT) 53,103 49,634 7 part

  17. Slide 17: Cement: Q2FY09 Highlights

    Cement : Q2FY09 Highlights Q2FY09 Q2FY08 % Chg.  Low volume growth in grey cement due Grey Cement to new capacity under stabilisation Capacity $ Mn. TPA 18.05 13.12 38 Production Mn. MT 3.65 3.62 1  Impressive growth in RMC business Sales Volumes* Mn. MT 3.70 3.60 3 supported by network expansion

  18. Slide 18: Cement: Outlook

    Cement : Outlook  Cement demand likely to get impacted, expected to grow at 7-8%  Moderation in economic growth rate  Slowdown in real estate and infrastructure sector  High interest rate  New capacity expected in FY’10 and FY’11 could lead to surplus scenario from calendar year 09  Prices and

  19. Slide 19: Cement Project Status

    Cement Project Status  4.4 Mn. TPA Shambhupura, Raj. : Clinker production commenced : Grinding facility to be commissioned in Q4  Split Grinding unit at Dadri, U.P. : Commissioned in Q2  4.5 Mn. TPA Kotputli, Raj. : Expected commissioning in Q4  4.9 Mn. TPA Tadpatri,A.P.(UltraTech) : Clinker pro

  20. Slide 20: Sponge Iron: Q2FY09 Highlights

    Sponge Iron : Q2FY09 Highlights  Production lower due to planned shutdown for modification of reactor Q2FY09 Q2FY08 % Chg.  Consequently, lower sales volume during Capacity (TPA) 900,000 900,000 -- the quarter Production (MT) 112,186 146,673 (24)  Higher sponge iron prices offset by higher Sales

  21. Slide 21: Capex

    [GRA STM] ADITYA BIRTA GROUP Capex 21

  22. Slide 22: Capex plans

    Capex plans  Capex Summary Rs. Crores Total Net Cash Outflow Project Capex * Cost FY09 FY10 Cement Business 5,952 2,902 1,891 927 - Projects: Kotputli (4.5 Mn. TPA), Shambhupura (4.4 Mn. 4,319 1,496 TPA), Dadri - GU (1.3 Mn. TPA) (incl. 96 MW TPP) - 2 Nos. Power Plants (48 MW), Waste Heat Recovery

  23. Slide 23: Capex plans - UltraTech

    Capex plans - UltraTech  Capex Summary Rs. Crores Total Cash Outflow Project Net Cost Capex * FY09 FY10 - 4.9 Mn. TPA Tadpatri Project, A.P. (incl. 50 MW TPP) 1,967 508 - 3 Nos. Power Plants (175 MW), Waste Heat Recovery 1,346 659 System (25 MW) - Grinding and Jetty Capacity Expansion at Pipavav /

  24. Slide 24: UltraTech Performance

    IG RA STM] UltraTech Performance 24

  25. Slide 25: UltraTech: Consolidated Financial Performance – Q2FY09

    UltraTech: Consolidated Financial Performance – Q2FY09 (Rs. Crores)  Revenue up by 22% - increased volumes Q2 Q2 % and higher realisation FY09 FY08 Chg.  Reduction in operating margins due to higher input costs Revenue 1,477.2 1,212.9 22  Imported coal price more than doubled Other Income 7.3 12.

  26. Slide 26: UltraTech Consolidated: Highlights

    UltraTech Consolidated: Highlights  Sales volume up by 13% Q2 Q2 % Chg.  Exports demand emanating from middle FY09 FY08 east Capacity (Mn. TPA) * 19.5 17.0 15  RMC volume up by 72% Production (Mn. MT) Cement 3.33 3.34 --  High realisation in export markets: FOB Sales volumes (Mn. MT) - Cement $6

  27. Slide 27: Summary

    [GRA STM] Summary 27

  28. Slide 28: Summary

    Summary  Grasim – A VSF and Cement major  With strong competitive edge  Global size operations  Consolidating leadership position with strong organic growth  Domestic leadership in Cement  Major Capex on capacity expansions, captive power plants, RMC and modernisation over FY07-FY09 period  F

  29. Slide 29: Plant Locations – Grasim & its subsidiaries

    Plant Locations– Grasim & its subsidiaries Bathinda(G) Proposed Cement Projects Panipat Proposed Grinding Units Bhiwani Dadri T Grey Cement plants Kotputli Aligarh Grinding Units (G) Jodhpur T Gwalior Shambhupura B Bulk Cement Terminal Jawad Bharuch Durgapur(G) UltraTech Cement Plants F Jafrabad Mag

  30. Slide 30: Thank You

    GRASTM ADITYA BIRLA GROUP Thank You

  31. Slide 31: Annexures

    Grasim Industries Limited Annexures

  32. Slide 32: Annexures

    Annexures  Consolidated and Standalone Financial  Consolidated and Standalone Profitability  Segmental Performance – Q2 FY09  VSF Summary  Chemical Summary  Cement Summary  Sponge Iron Summary  UltraTech Performance 32

  33. Slide 33: Financial Snapshot

    Financial Snapshot Standalone Consolidated (Rs. Crores) FY05 FY06 FY07 FY08 H1FY09 FY05 FY06 FY07 FY08 H1FY09 Gross Block $ 6,052 6,416 7,974 10,615 11,608 11,312 11,927 14,481 19,258 21,188 Net Block $ 3,204 3,307 4,593 7,050 7,840 6,294 6,411 8,468 12,919 14,478 Goodwill 1,958 1,773 1,844 1,991 2,

  34. Slide 34: Profitability Snapshot

    Profitability Snapshot Standalone Consolidated (Rs. Crores) FY05 FY06 FY07 FY08 H1FY09 FY05 FY06 FY07 FY08 H1FY09 Gross Turnover 7,201 7,638 9,573 11,552 5,960 10,776 11,746 15,674 19,113 9,948 Net Turnover 6,229 6,653 8,572 10,215 5,263 9,292 10,224 14,069 16,974 8,856 PBIDT 1,785 1,597 2,619 3,424

  35. Slide 35: Segmental Performance – Q2FY09

    Segmental Performance – Q2FY09 Standalone Rs. Crores ROAvCE (%) Revenue PBIDT PBIDT Margin (%) PBIT Capital Employed (PBIT basis) Business Q2FY09 Q2FY08 Q2FY09 Q2FY08 Q2FY09 Q2FY08 Q2FY09 Q2FY08 Q2FY09 Q2FY08 Q2FY09 Q2FY08 VSF 691 791 148 316 21.4 39.9 121 295 1,914 1,358 26.9 91.8 Chemical 145 114

  36. Slide 36: Segmental Performance – H1FY09

    Segmental Performance – H1FY09 Standalone Rs. Crores ROAvCE (%) Business Revenue PBIDT PBIDT Margin (%) PBIT Capital Employed (PBIT basis) H1 FY09 H1 FY08 H1 FY09 H1 FY08 H1 FY09 H1 FY08 H1 FY09 H1 FY08 H1 FY09 H1 FY08 H1 FY09 H1 FY08 VSF 1,336 1,498 343 572 25.7 38.2 291 531 1,914 1,358 32.4 82.7 C

  37. Slide 37: Viscose Staple Fibre: Summary

    Viscose Staple Fibre : Summary Q2 FY09 Q2 FY08 % Chg. H1 FY09 H1 FY08 % Chg. FY08 Capacity TPA 333,975 270,100 24 333,975 270,100 24 333,975 Production MT 62,973 69,678 (10) 121,056 138,233 (12) 279,901 Sales Volumes MT 62,536 70,183 (11) 119,295 139,579 (15) 269,781 Net Revenue Rs. Crs. 691.1 790.8

  38. Slide 38: Chemical: Summary

    Chemical : Summary Q2 FY09 Q2 FY08 % Chg. H1 FY09 H1 FY08 % Chg. FY08 Capacity TPA 258,000 258,000 -- 258,000 258,000 -- 258,000 Production MT 55,137 48,752 13 102,221 91,595 12 188,537 Sales Volumes MT 53,103 49,634 7 100,903 92,506 9 187,356 Net Revenue Rs. Crs. 145.3 113.6 28 271.9 206.0 32 417.6

  39. Slide 39: Cement: Summary

    Cement : Summary Q2 FY09 Q2 FY08 % Chg. H1 FY09 H1 FY08 % Chg. FY08 Grey Cement Capacity Mn. TPA 18.05 13.12 38 18.05 13.12 38 16.75 Production Mn. MT 3.65 3.62 1 7.64 7.48 2 15.36 Sales Volumes Mn. MT 3.70 3.60 3 7.67 7.50 2 15.54 Avg. Realisation Rs./MT 3,446 3,173 9 3,404 3,126 9 3,192 RMC Sales

  40. Slide 40: Sponge Iron: Summary

    Sponge Iron : Summary Q2 FY09 Q2 FY08 % Chg. H1 FY09 H1 FY08 % Chg. FY08 Capacity TPA 900,000 900,000 -- 900,000 900,000 -- 900,000 Production MT 112,186 146,673 (24) 212,718 284,809 (25) 562,000 Sales Volumes MT 117,972 141,960 (17) 209,177 281,666 (26) 557,187 Net Revenue Rs. Crs. 303.6 209.8 45 5

  41. Slide 41: UltraTech: Consolidated Financial Performance

    UltraTech: Consolidated Financial Performance (Rs. Crores) Q2 FY09 Q2 FY08 % Chg. H1 FY09 H1 FY08 % Chg. FY08 Cement Production (Mn. MT) 3.33 3.34 -- 7.28 7.25 -- 15.07 Sales Volume(Mn. MT): Cement-Domestic 3.23 3.15 3 7.04 6.82 3 14.25 Cement-Exports 0.19 0.20 (1) 0.34 0.43 (20) 0.90 Clinker 0.66 0

  42. Slide 42: Press Release Mumbai, October 23, 2008

    Press Release Mumbai, October 23, 2008 GRASIM, THE ADITYA BIRLA GROUP’s FLAGSHIP COMPANY PERFORMANCE FOR Q2FY2009 Consolidated Net Profit Rs.486 Crs. Consolidated Net Revenue Rs.4,489 Crs. Consolidated Financial Performance: Rs. Crores Q2 Q2 H1 H1 FY09 FY08 FY09 FY08 Net Revenue 4,489 3,964 8,944 8,

  43. Slide 43: Highlights of Grasim's operations: Q2FY09

    Highlights of Grasim’s operations: Q2FY09 Q2FY08 % Change Production - Viscose Staple Fibre M.T. 62,973 69,678 -10% Cement Mn. MT 3.65 3.62 1% White Cement M.T. 102,322 89,733 14% Sponge Iron M.T. 112,186 146,673 -24% Caustic Soda M.T. 55,137 48,752 13% Sales Volumes - Viscose Staple Fibre M.T. 62,5

  44. Slide 44: Cement Subsidiary and Capex plan

    Cement Subsidiary The performance of UltraTech Cement Limited, a subsidiary of Grasim, was subdued. The sharp increase in prices of coal and raw materials resulted in variable costs rising by 37%. The combined sales of cement and clinker reflected a growth of 13%. Net Profit was lower by 9% at Rs.16

  45. Slide 45: Unaudited Financial Results for Quarter Ended 30 September 2008

    UNAUDITED FINANCIAL RESULTS FOR THE QUARTER ENDED 30th SEPTEMBER 2008 I. CONSOLIDATED RESULTS : Rs in Crores Three Months Three Months Six Months Six Months Year ended 30th ended 30th ended 30th ended 30th ended 31st September 2008 September 2007 September 2008 September 2007 March 2008 ( Audited )

  46. Slide 46: Segment Reporting - Consolidated

    III. SEGMENT REPORTING - CONSOLIDATED Rs. in Crores Three Months Three Months Six Months Six Months Year ended 30th ended 30th ended 30th ended 30th ended 31st September 2008 September 2007 September 2008 September 2007 March 2008 ( Audited ) 1. SEGMENT REVENUE a Fibre & Pulp 825.46 901.07 1,617.69

  47. Slide 47: Notes

    V. NOTES 1 Consolidated Results have been prepared in accordance with Accounting Standard on Consolidated Financial Statements (AS-21), Accounting Standard on Accounting for Investments in Associates (AS-23) and Accounting Standard on Financial Reporting of Interest in Joint Ventures (AS-27) issued

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