Coromandel International Limited · NSE:COROMANDEL
Coromandel International — Investor Presentation (June 2012)
50 slides from Coromandel International's investor presentation, June 2012
Slide 1: Investors Presentation
June, 2012 Investors Presentation 1
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements which may be identified by their use of words contains “plans,” “expects,” “will,” “anticipates,” “believes,” “intends,” “projects,” “estimates” or other words of similar meaning. All statements that address expectations or projections
Slide 3: Contents
Contents Company Profile 4 Fertiliser 7-23 SND 24-28 Crop protection 29-36 Retail 37-40 Financial Performance 41-46 Awards and Accolades 47-49 3
Slide 4: Company Snapshot
Company Snapshot Coromandel Share in • Coromandel International Limited, Murugappa Group established in 1961 is the flagship Turnover company of the INR 22,314 Crores 44% Murugappa group Coromandel Others • Coromandel is India’s second largest 56% producer of Phosphatic Fertilizers EBITDA • In FY201
Slide 5: Business Structure
Business Structure Sales EBITDA Phosphatic DAP Fertilisers Complex Fertilisers /SSP/MOP 90% 70% G-Sulphur Specialty Water Soluble Fertilisers Nutrients & Coromandel Compost Organic Manure Technicals 10% 30% Crop Protection Formulations Agri Inputs Retail Agri Services 5
Slide 6: Strategic Direction
Strategic Direction Farm Inputs Business Dominance in Fertilisers Non Subsidy Businesses Sourcing Cost Marketing Leadership Strength • Specialty Nutrients/ Water Strategic Alliances in • Low cost • Wider reach and Soluble Sourcing – manufacturer of penetration Fertilisers/Micro • Long Term tie-up wi
Slide 7: Coromandel's Fertiliser Business
Coromandel’s Fertiliser Business 7
Slide 8: Coromandel Fertiliser Business Growth Story
Coromandel Fertiliser Business Growth Story C Train Expansion SSP Plant in Bhatinda 42 Lac Mt 8
Slide 9: Global Strategic Alliances
Global Strategic Alliances Pact with QAFCO for supply of Urea and Ammonia 9
Slide 10: State of The Art Manufacturing Facilities
State of The Art Manufacturing Facilities • Plants are strategically located in highly • High capacity utilisation levels & irrigated southern Indian states and in continuous modernisation of facilities heart of fertilizer consumption market – • Backward integration into low freight cost manufacturi
Slide 11: Cost Leadership
Cost Leadership Visak Production (Million Mt) Visak Plant Captive Phos Acid 1.05 1.00 0.98 • Continuous de-bottle necking to increase production levels 0.94 0.91 • Value gap - imported Vs own acid 0.70 0.74 • Increased Gypsum generation • Use of various sources /grades of rocks • New belt filter tec
Slide 12: Marketing Network
Marketing Network Uttar Pradesh (UP) West Bengal (WB) Company Bihar Orissa (OR) Andhra Pradesh (A.P) Karnataka (KN) Maharashtra (MH) Madhya Pradesh (MP) Wholesaler & Chattisgarh / Distributor Tamil Nadu (TN) PDO Semi Wholesaler / Dealer Visak Retailer Kakinada / Sub Dealer Ennore Ranipet Farmer 12
Slide 13: Business Update – June'12
UZ Coromandel & = BUSINESS UPDATE - JUNE’12 ne murugappa 13
Slide 14: Fertilisers – Indian Scenario
Fertilisers – Indian Scenario • India continues to remain one of the key drivers of growth of fertiliser demand in the World. Agriculture expected to grow at 3.5-4% in FY11-12 with record food production of over 252.5 Mn MT in 2011-12 (245 Mn MT 2010-11) Sales – lac Mt Import – lac Mt Production – l
Slide 15: Coromandel FY12 Production / Imports / Sales
Coromandel FY12 Production / Imports / Sales Million MT YoY 2010-11 2011-12 Growth Production DAP 4.34 3.62 -17% Complex 21.04 19.72 -6% SSP 1.04 1.07 3% Total 26.43 24.42 -8% Imports DAP 0.99 1.09 10% Complex 0 2.84 nm MOP 1.63 1.37 -16% Urea 1.98 2.65 34% Total 4.59 7.95 73% Sale of Manufactured P
Slide 16: International Raw Material Price Movement
International Raw Material Price Movement Phos acid Ammonia 1100 600 550 1050 500 1000 450 400 950 Phos Acid - finalized @ 885 $ per Mt for 1st Qtr 350 Ammonia– Firming Up 900 300 January 12 February 12 March 12 April 12 May 12 January 12 February 12 March 12 April 12 May 12 Urea DAP 650 650 600 600
Slide 17: Current Scenario
Current Scenario • International prices of DAP are stable- currently around USD:INR 580$. Indian buyer’s have contracted DAP @ 580 USD/Mt 58.00 57.00 • Phos acid price – finalized @ 885 $ per mt for 1st and 2nd Qtr 56.00 • Ammonia /Urea prices continue to rule high 55.00 54.00 • As per IMD, there wi
Slide 18: NBS rates
NBS rates • NBS policy for P&K fertilisers • Improved availability for farmers • Reduced subsidy outgo for the Govt Estd. Rs. 18,000 Cr for last 2 yrs • Input prices negotiated based on market condition • NBS rates for 2012-13 reduced in line with drop in international prices Subsidy - Rs. Per Kg Nu
Slide 19: MSP Trend
MSP Trend MSPs 2011-12 2012-13 % Change Paddy 1,080 1250 16% Maize 980 1175 20% Wheat 1120 1285 15% Cotton 2500 2800 12% Sugarcane 145 Not Decided na Green Gram 3,500 Not Decided na Urad 3,300 4300 30% Tur 3,200 Not Decided na Ground nut 2,700 3700 37% Seseamum 3,400 4200 24% Soya 1,650 2200 33% Sun
Slide 20: Project Update – C Train
Project Update – C Train • Progressing at brisk pace • Scheduled to be completed by Aug / Sep 2012 • Focus on unique grades • Project will be eligible for weighted tax deduction under section 35AD of Indian Income tax Act, 1961 60 meter Slab Ammonia Tanks 20
Slide 21: Project Update – TIFERT
Project Update – TIFERT Sulphuric Acid Plant TIFERT Project • Situation returning to Normal • Overall completion status 97.34% • Scheduled to be online by Aug/Sep’12 Phos Rock digestion section Phos Acid Plant – Concentration section 21
Slide 22: Project Update – SSP
Project Update – SSP SSP Bhatinda • Sulphur being tie up with HPCL Mittal Energy Limited refinery • Land is being finalized and activity will commence shortly • Plant will be commissioned in 2013-14 22
Slide 23: Positive developments from finance bill 2012
Positive developments from finance bill 2012 Weighted deduction of 150% available under Section 35AD for fertilizer projects Import of manufacturing equipment for fertilisers exempted from custom duty for 3 years - currently at 5% Withholding tax on ECBs for fertiliser sector reduced from 20% to 5%
Slide 24: Specialty Nutrient Business
Specialty Nutrient Business 24
Slide 25: Speciality Nutrients Division (SND)
SPECIALITY NUTRIENTS DIVISION (SND) G-SULPHUR Micronutrients Organic Compost WSF GROMOR SULPHUR GROMOR SPRAY Boron Zinc GROMOR POWER Sulphozinc 25
Slide 26: Basics of Water Soluble Fertilisers
Basics of Water Soluble Fertilisers What is Water soluble fertilizers? How to use Water soluble fertilizers? •100% water soluble •Available in double and multi nutrient •Foliar application combinations with or without secondary •Fertigation (with Drip) elements or micronutrients. •Available in the P
Slide 27: Sulphur and WSF Business
Sulphur and WSF Business SQM JV commissioned 2011 27
Slide 28: SND & Organic Manure Business
SND & Organic Manure Business Bentonite Sulfur Record turnover of Gromor Sulfur with y/y growth of 14%. Organic Compost Volumes (Mt) Continues to be the market leader despite adverse market conditions WSF 1,59,169 1,19,276 New WSF plant under JV with SQM commenced operations 78,171 SQM JV plant like
Slide 29: Crop Protection Business
Crop Protection Business Coromandel
Slide 30: Crop Protection business
Crop Protection business • Wider range of Technicals 2011 (insecticides/fungicides/herbicides) • Increased Global presence and registration Sabero Acquisition 2010 • Strong distribution with own retail outlets -Open Offer process to get underway shortly Acquired Pasura Bio Tech – Jammu Unit 2009 II
Slide 31: Crop Protection business - Key Strengths
Crop Protection business- Key Strengths Regular introduction of new technicals to offset Endosulfan phase out Low cost manufacturer of technicals Leveraging Retail network (MGCs) to grow branded formulation business Continued specialty focus for improved profitability Exclusive import sourcing Integ
Slide 32: Initiatives
Initiatives Operational Initiatives Jammu • Expansion of technical plant capacity at Ankleshwar • Export to more countries & increase the reach • Focusing on high margin super specialities • Leveraging on retail network in AP & Accelerated growth plan in all states Strategic Initiatives • Acquired S
Slide 33: Business Update – June'12
UZ Coromandel & = BUSINESS UPDATE —- JUNE’12 ne murugappa 33
Slide 34: Crop Protection Business Highlights
Crop Protection Business Highlights • Global industry achieved a growth of 16% in nominal terms and 8% in real terms over previous year supported by higher commodity prices • Indian industry witnessed late onset of monsoon and record sowing of cotton during the year. But due to insufficient rains in
Slide 35: Update on Sabero Organics Gujarat Limited
Update on Sabero Organics Gujarat Limited Coromandel along with subsidiary Parry Chemicals currently holds 74.57% stake in Sabero Acquisition helped Coromandel to move to top 5 player in Agro chemical Industry Access to Global markets; Synergies in Latin America operation Expanded basket of captive
Slide 36: Update on Sabero Organics Gujarat Limited
Update on Sabero Organics Gujarat Limited Financials of Sabero affected in 11- (Rs. Cr) 10-11 11-12 12 due to Turnover 413 361 EBITDA (before E/O Items) 41 (4) One time write offs/exchange E/O Items and FOREX (2) (34) EBITDA Reported 39 (38) difference % of TO 10-11 11-12 Fungicides 43% 45% Low capa
Slide 37: Mana Gromor Centers (MGCs) - Retail
Mana Gromor Centers (MGCs) - Retail 37
Slide 38: Retail Business - Rationale
Retail Business - Rationale Viable Alternative • Develop Distribution Channel for Coromandel • Reduce Dependency on Distributors • Capture opportunities in Rural Areas Opportunities in Rural Areas • Providing Lifestyle Products at nearest Location • Supply Products and Solutions to improve earning c
Slide 39: Retail Business Overview
Retail Business Overview • Over 500 Mana Gromor Centers in Andhra Pradesh and 100 centers in Karnataka - servicing close to 2 million farmers • Further expansion to Karnataka and Maharashtra soon • Targeting 1000 centers Products & Service Offerings Veterinary Other Crop Fertilisers Seeds SND FMS Ag
Slide 40: Performance Highlights - Retail
Performance Highlights - Retail 424 old stores in AP have completed 3 full years - out of this 311 stores have turned profitable (compared to 229 for last year) Completed the rollout of 200 new stores in AP and Karnataka – Total stores as on date 640 Entered into supply arrangements for the launch o
Slide 41: Financial Performance
Financial Performance 41
Slide 42: Financial highlights – FY12
Financial highlights – FY12 • Turnover for year ended March 2012 at Rs. 9,823 Cr against Rs. 7,639 Cr for last year ( y/y growth 29%) • EBITDA for the year at - Rs. 1,015 Cr against Rs. 830 Cr for last year (y/y growth 22%) • PBT for the year before prior year subsidy and extra ordinary items - Rs.
Slide 43: Financial Performance
Financial Performance Turnover ( RS. Cr) EBIDTA (Rs. Cr) & EBIDTA % 1,200 14.0% Extra Ordinary Item 10.9% 10.3% 9,408 9,823 46 1,000 11.7% 12.0% 159 227 7,639 PY Subsidy 800 10.0% 6,452 10.3% 600EBITDA before PY 262 7.8% 8.0% Subsidy & EO Items % 3,787 1,015 7.3% 830 400 6.0% 2,080 EBITDA % 689 442
Slide 44: Income Statement
Income Statement Amount in Rs. Cr 2007 2008 2009 2010 2011 2012 Revenue 2,080 3,787 9,408 6,452 7,639 9,823 YoY (Growth) 82.09% 148.42% -31.42% 18.40% 28.59% EBITDA before PY Subsidy & EO Items 214 442 689 506 830 1,015 EBITDA % 10.27% 11.68% 7.32% 7.85% 10.86% 10.34% PY Subsidy - - - 262 227 46 EBI
Slide 45: Balance sheet
Balance sheet Amount in Rs. Cr 2007 2008 2009 2010 2011 2012 Equity 512 794 1,127 1,435 1,904 2,371 Debt & Other LT liabilities 549 1,043 1,720 1,918 1,471 2,468 Deferred Tax Liability 71 83 80 86 82 68 Sources of Funds 1,133 1,920 2,927 3,438 3,457 4,907 NFA 382 735 792 817 853 940 Investments 174
Slide 46: Bonus Debentures
Bonus Debentures Rewarding Coromandel ‘s Shareholders 1.Face Value -Rs.15/- 2.Quantum of Bonus Debentures issued - 1BonusDebenture for every share of Re.1/each 3.Tenor - 4 years - Redemption in the years 2 / 3 & 4 4.Coupon - 9% (Annual) 5.Cash outgo - Rs.495 cr (incl. dividend tax) 6.Allotment - lik
Slide 47: Awards & Accolades
UZ Coromandel & = AWARDS & ACCOLADES ne murugappa 47
Slide 48: Awards 2011-12
Awards 2011-12 1. Coromandel received ‘Significant Achievement’ in the CII-EXIM Bank Business Excellence Award 2011. 2. Kakinada Plant received the FAI award for ‘Best Overall Performance’ of an Operating Fertiliser Unit for Complex Fertilisers. 3. Visakhapatnam Plant received the CII’s National Wat
Slide 49: Awards 2011-12 (Contd..)
Awards 2011-12 ( Contd..) 8. Best L&D Strategy award by Indian Human Capital Summit-2011. 9. National Award, 1st Prize, by Public Relations Society of India, New Delhi for Coromandel in-house magazine-‘The VOICE’ (for the sixth time). 10. National Award, 1st Prize, for the Corporate Film by Public R
Slide 50: Thank You
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