Vaibhav Global Ltd. · NSE:VAIBHAVGBL
Vaibhav Global — Q2 FY24 Earnings Presentation
50 slides from Vaibhav Global's earnings presentation, September 2023
Slide 1: Results Presentation: Q2 and H1 FY24
Vaibhav Global Limited Global Retailer on TV and Digital Platforms of Fashion Jewellery, Lifestyle Products and Accessories Results Presentation: Q2 and H1 FY24
Slide 2: Disclaimer
Disclaimer This presentation contains “forward looking statements” including, but without limitation, statements relating to the implementation of strategic initiatives, and other statements relating to Vaibhav Global Limited (VGL) and its group companies’ future business developments and economic p
Slide 3: MD's Message
Sales for the quarter were Rs. 705 crores, an increase of 9.1% over same quarter of last fiscal year. Gross margins in Q2 FY24 came in at 61.4% of the revenue. We are the only company in our peer group that has its own manufacturing set-up in addition to a global sourcing base. This vertically integ
Slide 4: Table of Contents
Table of Contents Company Overview 6 Business Overview 10 Recent Acquisitions 24 Operational & Financial Highlights 27 Financial Performance Trends 38 Annexures 43 4
Slide 5: Q2 & H1 FY24 Highlights
Q2 & H1 FY24 Highlights Revenue growth of 9.1% YoY Gross margins at 61.4% owing to better pricing and strength of vertically integrated business model EBITDA margin at 9.5% vs 8.1% in Q2 FY23. YoY improvement on account of better pricing and cost rebase Unique customer base at 4.5 lakhs with new reg
Slide 6: Company Overview
Company Overview
Slide 7: Guiding Pillars That Defines VGL
Guiding Pillars That Defines VGL OUR VISION OUR MISSION Be the Value Leader in Electronic To deliver one million meals per day to Retailing of Jewellery & Lifestyle children in need by ‘FY31’ through our one Products for one meal program- ‘Your Purchase Feeds…’ CORE VALUES Team-Work Honesty Passion
Slide 8: About Us
About Us Vertically-integrated Digital Retailer of fashion Strong Customer Visibility jewellery & lifestyle products ▪ TV Homes accessed (*FTE): ~ 139 mn ▪ End-to-end B2C business model households ▪ Presence through proprietary TV channels and ▪ Growing digital presence digital platforms Strong Mana
Slide 9: An Evolving Journey
An Evolving Journey Started Gemstones Started Jewellery Listing on stock business manufacturing for B2B exchange 1980 1996 1997 Ventured into 'Lifestyle Shifted strategy towards Products' category, name 'value conscious offering' changed to Vaibhav Global Ltd. Started own TV 2008 06-07 channels in U
Slide 10: Business Overview
Business Overview
Slide 11: E-tailing in High Potential Markets
E-tailing in High Potential Markets (USD 20 bn) US UK GERMANY & AUSTRIA Opportunity size $14- $15 bn $2-$2.5 bn ~$3 bn ➢ Target customers: Baby Boomers (65+ years) & Gen X (45+ years) ➢ Value-buying proposition of $25-$45 ➢ Widest product range comprising ~25,000 SKUs * Statista, Marketresearch.com
Slide 12: Strategic Enablers
Strategic Enablers 1. Omni-Channel 2. Vertically Presence Integrated Supply Chain (Proprietary TV, Website, Apps, OTT, Marketplaces & Social Media) An Efficient Interplay of 4. In-House Brand 3. Wider Product And Innovation Bouquet 14
Slide 13: A Global Retailer on TV and Digital Platforms
1. A Global Retailer on TV and Digital Platforms PROPRIETARY ‘TV CHANNELS’ ‘DIGITAL’ PLATFORMS Proprietary Digital Platform Mobile Applications www.shoplc.com www.tjc.co.uk www.shoplc.de Third Party Marketplaces Social Retail Google Marketplace Reaching TV homes through Cable, Satellite and OTA broa
Slide 14: Vertically Integrated Supply Chain
2. Vertically Integrated Supply Chain Manufacturing in Asian countries Serving Selling in western countries Primary Retail Markets USA UK Germany India & China Resulting in industry leading gross margin of 60%+ 16
Slide 15: Complemented by a Robust Sourcing Base
2. Complemented by a Robust Sourcing Base (US) (UK) (Germany ) Sourcing Countries ▪ India ▪ UK ▪ China ▪ Mozambique ▪ Thailand ▪ Germany ▪ Indonesia ▪ Italy ▪ Tanzania ▪ Turkey ▪ Russia ▪ Poland ▪ Morocco ▪ Singapore ▪ Myanmar ▪ UAE ▪ Madagascar ▪ Japan ▪ Bolivia ▪ Bangladesh ▪ Kenya ▪ Philippines ▪
Slide 16: Constantly Reimagining Growth Through New Designs & Products
3. Constantly Reimagining Growth Through New Designs & Products Some of the best-selling products Fashion Jewellery & Gemstones ▪ ~14K-15K new jewellery designs launched annually ▪ In-house testing lab and manufacturing Hanabi Cut Rhapsody Tanzanite Ring Ring Life-Style Products ▪ A rich product bas
Slide 17: Strengthening Own Brand Portfolio
4. Strengthening Own Brand Portfolio • Leveraging manufacturing & digital capabilities USA UK Germany • Number of brands: 31 • Current revenue mix: ~29% of B2C revenue • Target revenue mix: ~50% by FY27 of B2C revenue • Strategic brand matrix (price laddering and offering) • Increase repeats and ret
Slide 18: 'Innovation' Focused
4. ‘Innovation’ Focused 34,300+ 4,300+ 1,830+ Ideas Generated Ideas Approved Products sold 15,600+ 2,730+ Ideas Proposed to Orders Placed Buyers Global Search Program Crowdsourcing of Ideas A Global product innovation From employees, customers and external stakeholders Revenue contribution of and se
Slide 19: Resulting In
RESULTING IN
Slide 20: Top decile shareholders' returns Growing Consistently
Top decile shareholders’ returns Growing Consistently Parameters CAGR Return FY 98 FY 23 (Rs. in crores) (25 years) (x times) Revenue 43.6 2,690.9 17.9% 62 EBITDA 6.2 227.3 15.5% 37 Profit Before Tax 5.4 141.4 13.9% 26 Profit After Tax 5.3 105.1 12.7% 20 Net Worth 21.8 1,201.3 17.4% 55 ~25% CAGR in
Slide 21: With Consistent Business Delivery
With Consistent Business Delivery Global Households Reach Repeat Purchases (in million) (no. of pieces) 135 139 127 27 27 106 23 23 FY21 FY22 FY23 Sep-23 FY21 FY22 FY23 Sep-23 Reach Repeat Purchases Note: Households numbers for past period have been reinstated due to change in methodology by the tra
Slide 22: With Consistent Business Delivery
With Consistent Business Delivery Retention (20+ Purchases)* Spend per customer^ (in $) 800 89.3% 88.9% 718 86.6% 87.0% 705 685 700 654 600 500 400 FY21 FY22 FY23 Sep-23 FY21 FY22 FY23 Sep-23 Retention Rate Spend per customer * Retention data comprises Shop LC (US) and Shop TJC (UK) * Refers to rete
Slide 23: Broad Based E-tailer
Broad Based E-tailer B2C Revenues by Format B2C Revenues by Product Category TV revenues Digital revenues Jewellery Lifestyle 27% 37% 39% 12% 27% 27% 73% 88% 73% 73% 63% 61% FY18 FY23 H1 FY24 FY18 FY23 H1 FY24 Jewellery : Fashion Jewellery, Gemstones and Accessories Lifestyle : Home Décor, Beauty &
Slide 24: Recent Acquisitions
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Slide 25: Ideal World
Ideal world About the company Lifestyle Products Key Business Matrixes Opportunities • Brand legacy: 21 yrs+ • Home decor • Turnover £60mn (FY23) • Operational • Presence in 27 • Health & Beauty • ASP: ~£25 efficiencies: lean cost million households • Apparels • Customer Base ~480K structure • Servi
Slide 26: Mindful Souls
Mindful Souls About the company Personal Care & Key Business Matrixes Opportunities Selflove Products • 2022: • Digital learning • Incorporated in 2018 • Fashion Jewellery o Turnover : €18mn • Expansion outside US in Netherlands & Gemstone o PBT margin: 10% • Cost synergies • Serving customers in •
Slide 27: Q2 FY24 Operational & Financial Highlights
Q2 FY24 Operational & Financial Highlights
Slide 28: Being Resilient
Being Resilient ▪ Growth primarily driven led by improved Revenue and EBITDA trend 12.0% 10.5% product offering and increased household 10.0% 9.5% 10.0% 8.1% penetration 8.0% 9.1% 8.0% 6.0% 4.8% 4.0% ▪ Positive outlook for upcoming season 1.8% 2.0% 1.1% 0.0% ▪ Improvement in EBITDA owing to -2.0% Q2
Slide 29: An Update on Germany
An update on Germany Germany venture increase in TAM (immediate addressable market) by ~20% ▪ Now clocking monthly revenue of Euro 1.86 mn+ at 60%+ gross margins ▪ Omni-channel presence (digital is now 28%) ▪ Presence in 42 million households ▪ Dispatching 3.6k+ pieces/day ▪ Positive customer orient
Slide 30: Germany: Consolidating Customer Reach
Germany: Consolidating Customer Reach ▪ Partnered with Vodafone and Tele Columbus’ HD channels: Partnerships ▪ Vodafone: 13 million HD households leading to ▪ Tele Columbus: 2 million HD households ▪ HD broadcasting rights to further strengthen visibility and market share gains ▪ 95% household penet
Slide 31: Widening Digital Presence: OTT
Widening Digital Presence OTT: Huge Growth opportunity In US, OTT’s are projected to be the fastest growing video distribution medium US internet connected device installed base, 2016 to 2026 Live & Interactive Apps Shop LC (US) $3,000 OTT Revenue (USD '000) $2,500 $2,000 $1,500 $1,000 $500 $0 Q1 Q2
Slide 32: Capitalizing Cord Shifting through OTA
Capitalizing Cord Shifting through OTA Our target demographics prefer Expanding presence through OTA watching traditional Pay-TV % of population having TV (age group wise) Total OTA HH in US: 86% 23mn 80% 81% 73% 65% 66% Shop LC’s Presence 46% Low Power: ~18mn HH 34% Full Power: ~5mn HH Revenue Mix
Slide 33: Financial Highlights – Q2 FY24 Performance
Financial Highlights – Q2 FY24 Performance Fashion Jewellery, Lifestyle Products & Accessories (Rs. Cr) Total Revenue TV Revenue Digital Revenue B2B Revenue 900 5 years CAGR 5 years CAGR 400 5 years CAGR 50 9% 7% 19% 9.1% 45 800 350 705 500 2.3% 40 700 450 36 646 397 406 13.0% 300 35 400
Slide 34: Financial Highlights – Q2 FY24
Financial Highlights – Q2 FY24 Revenue – (Local Currency) Shop LC (US) Shop TJC (UK) 5 years CAGR 5 years CAGR 4% 8% (USD million) (GBP million) 3.3% 2.2% 53.8 18.5 52.0 18.1 42.1 12.4 Q2 FY19 Q2 FY23 Q2 FY24 Q2 FY19 Q2 FY23 Q2 FY24 34 34 33
Slide 35: Retail Performance Trends – Q2 FY24
Retail Performance Trends – Q2 FY24 TV Sales Sales Volume ('000s) Average Selling Price US$ 1,411 1,236 39.7 35.3 1,100 600 100 Q2 FY23 Q2 FY24 Q2 FY23 Q2 FY24 Digital Sales Sales Volume ('000s) Average Selling Price US$ 1,200 1,099 1,100 1,066 31.0 29.9 1,000 26.6 26.0 900 21.0 800 700 16.0 Q2 FY23
Slide 36: Financials – Q2 FY24 Performance
Financials – Q2 FY24 Performance Gross Profit (Rs. Cr) and Margin (%) EBITDA (Rs. Cr) and Margin( %) EBITDA Gross 60.9% 61.4% 8.1% 9.5% Margin (%) Margin (%) 9.9% 433 28.6% 394 67 52 Q2 FY23 Q2 FY24 Q2 FY23 Q2 FY24 PAT (Rs. Cr) and PAT Margin % EPS (Rs.) PAT Margin (%) 3.6% 4.1% 25.6% 1.8 29 1
Slide 37: EBITDA Margin Walk
EBITDA Margin Walk % to Particulars Remarks Revenue EBITDA Q2 FY23 8.1% Gross Margin 0.5% Better pricing Impact pertains to currency Germany (0.2%) conversion Logistics cost 1.1% Cost renegotiation and volume EBITDA Q2 FY24 9.5% 37 37
Slide 38: Financial Performance Trends
Financial Performance Trends
Slide 39: Financial Performance Trends
Financial Performance Trends Revenue Breakdown – (Rs. crore) 5 years CAGR: 11.4% 2,540 2,752 2,691 1,814 1,986 1,571 1,275 1,363 FY18 FY19 FY20 FY21 FY22 FY23 H1 FY23 H1 FY24 Fashion Jewelry, Accessories & Lifestyle Products (Rs. Crore) 5 years CAGR: 10.4% 5 years CAGR: 21.2% Digital Revenue B2B Rev
Slide 40: Retail Performance Trends
Retail Performance Trends TV Sales Sales Volume ('000s) Average Selling Price US$ 7,837 38.0 40.8 6,998 36.3 6,275 6,070 29.9 32.6 5737 5,331 27.0 26.5 27.7 2,751 2,373 FY18 FY19 FY20 FY21 FY22 FY23 H1 FY23 H1 FY24 FY18 FY19 FY20 FY21 FY22 FY23 H1 FY23 H1 FY24 Digital Sales Sales Volume ('000s) Aver
Slide 41: Annual Financial Performance
Financials – Annual Financial Performance Shareholders’ Equity (Rs. Cr) Fixed assets including intangibles (Rs. Cr) 1,203 1,224 602 1,127 964 511 494 697 751 550 163 192 120 117 FY18 FY19 FY20 FY21 FY22 FY23 H1 FY24 FY18 FY19 FY20 FY21 FY22 FY23 H1 FY24 Net Debt (Rs. Cr) Net Assets* (Rs. Cr) FY18 FY
Slide 42: Financials Performance Trends & Ratios
Financials Performance Trends & Ratios Operating Cash flow (Rs. Cr) Free Cash Flow (Rs. Cr) 324 268 203 211 181 176 126 86 90 85 55 38 20 (214) FY18 FY19 FY20 FY21 FY22 FY23 H1 FY24 FY18 FY19 FY20 FY21 FY22 FY23 H1 FY24 ROE (TTM) ROCE (TTM) 32% 61% 25% 26% 23% 23% 46% 37% 31% 27% 9% 10% 14% 16% FY18
Slide 43: Annexures
Annexures
Slide 44: Growth In Digital Commerce Markets
Growth In Digital Commerce Markets Broader macro challenges tapering down UK UK US ▪ Muted consumer sentiments 30.9% 27.8% 26.5% 25.9% 25.5% 15.3% ▪ Cost of living crisis 14.0% 14.6% 14.5% 19.1% 11.0% ▪ Resultant industry wide stagnancy in online sales mix US ▪ Gradual recovery in consumer demand an
Slide 45: Robust Corporate Governance
Robust Corporate Governance Awards & Accolades H1 FY24 ~Rs. 50 crores India Risk Management Award from ICICI Lombard & CNBC-TV18 LEED’s PLATINUM & GOLD Certification Interim Dividends Dividend Payout Policy ‘Net Zero Energy Building’ certified ▪ 20-30% of consolidated free cash flows ▪ Balance betwe
Slide 46: Strong & Experienced Management
Strong & Experienced Management Mr. Sunil Agrawal Mr. Nitin Panwad Mr. Vineet Ganeriwala Mr. Srikant Jha Mr. Deepak Mishra Managing Director, VGL Group Group CFO, VGL Group President, Shop LC (US) Managing Director, Managing Director, Shop TJC (UK) Shop LC (Germany) Mr. Ankur Sogani Mr. Deepak Sharm
Slide 47: Sustainability Initiatives
Sustainability Initiatives ENERGY BIODIVERSITY WATER WASTE Solar power capacity meets 100% Saplings planted Conversion of bio- Solar power requirement at ~28,000 for developing 2 6100 KL Rainwater per annum harvested 100% degradable waste 3.23 mw manufacturing units in Jaipur Miyawaki forests (veget
Slide 48: Growth With Responsibility
Growth With Responsibility ▪ Till date Served 81 million meals to underprivileged children through flagship One for One Program, ‘Your Purchase Feeds…’ ▪ Local charity partners ✓ Akshaya Patra in India ✓ No Kid Hungry and Backpack Friends in US ✓ Magic Breakfast & Felix Project in UK ▪ Serving ~46k
Slide 49: Shareholding Pattern: As on 30th September 2023
Shareholding Pattern: As on 30th September 2023 Holding as on Key Shareholders 30th-Sep-23 Shareholding Pattern Nalanda India Fund Limited 10.16% Motilal Oswal Flexi Cap Fund 5.26% Others 11.30% Malabar India Fund Limited 5.38% Individual - >1% 3.19% AIF 0.43% Vanguard 1.46% Domestic Institutions (M
Slide 50: Vaibhav Global Limited
Company: Investor Relations Advisors: Vaibhav Global Limited Adfactors PR Pvt. Ltd. Nitin Panwad, Group CFO Amit Sharma Nitin.panwad@vglgroup.com Amit.Sharma@adfactorspr.com Prashant Saraswat Disha Shah Head-Investor Relations Disha.shah@adfactorspr.com VAIBHAV GLOBAL LIMITED Prashant.saraswat@vglgr