Acc Limited · NSE:ACC
Acc — Investor Presentation (March 2018)
28 slides from Acc's investor presentation, Mar 13, 2018
Slide 1: Letter to BSE Limited: Investor Presentation
Secretarial Division 14" March 2018 General Manager - Department of Corporate Services BSE Limited Pheroze Jeejeebhoy Towers Dalal Street Mumbai 400 001 Scrip Code: 500410 Dear Sirs Sub: Investor Presentation ACC ACC Limited Registered Office Cement House 121, Maharshi Karve Road Mumbai 400 020, Ind
Slide 2: ACC – ACL Master Supply Agreement Investor Presentation
ACC – ACL Master Supply Agreement Update on Merger and Recommendation on Unlocking Synergies Investor Presentation 13th March 2018 © 2012 Legal entity
Slide 3: Disclaimer / Safe Harbour
Disclaimer / Safe Harbour Cautionary statement regarding forward-looking statements This presentation may contain certain forward-looking statements relating to ACC Limited (“ACC” or “Company”) and its future business, development and economic performance. These statements include descriptions regar
Slide 4: ACC Limited: Pioneer and trendsetter of Indian cement industry
ACC Limited (ACC): Pioneer and trendsetter of Indian cement industry … Current structure Pan India footprint with cement capacity of 33.4 mn tonnes Wide spread geographical positioning LafargeHolcim Leading brand with large network of dealers/retailers (trade sales >75% of total 63.11% volume)
Slide 5: … with a strong nation-wide presence…
… with a strong nation-wide presence… Physical Infrastructure Integrated Plants 11 Kilns 12 Clinkerisation Capacity (MTPA) 20.1 Grinding Units 5 Cement Grinding Capacity (MTPA) 33.4 Blending Unit 1 Bulk Cement Terminal 1 Pan India footprint of ACC 4
Slide 6: … and a deep complementary pan-India footprint, along with ACL
… and a deep complementary pan-India footprint, along with ACL ACC and Ambuja Brands : Two of the strongest brands in Indian cement industry LafargeHolcim Group has substantial investments in India through Ambuja Cements Limited (“ACL”) (its direct subsidiary) and ACC Limited (its indirect subsidi
Slide 7: ACC Consolidated Performance
ACC Consolidated Performance
Slide 8: CY 2017 Performance Highlights
CY 2017 Performance Highlights Capacity Highest ever Net Sales Utilization Up Cement Volume YoY growth 6% 14% 20% 2017: 79% 2017 : 26.2 mn t 2017 : ₹ 12,909 Cr 2016: 73% 2016 : 23.0 mn t 2016 : ₹ 10,772 Cr EBITDA EBITDA Margin PBT PAT Growth Growth Growth Growth 29% 110 bps 48% 41% 2017 : ₹ 1,912 Cr
Slide 9: ACC – Strong performance despite market challenges
ACC* – Strong performance despite market challenges Net Sales, Operating EBITDA & EBITDA Margin Profit Before Tax & Profit After Tax ₹ in crore ₹ in crore 12,909 11,480 11,433 10,889 10,772 1,310 1,214 1,095 1,120 1,162 885 925 766 658 588 15.0% 14.8% 13.2% 13.4% 13.7% 1,630 1,513 1,537 1,478 1,912
Slide 10: ACC – Dividends per share/ EPS/ Dividends Pay-out ratio
ACC* – Dividends per share/ EPS/ Dividends Pay-out ratio Dividend/share, EPS and Payout ratio Book Value Per Share ₹ per share ₹ per share 55% 498 54% 53% 51% 48% 469 62 58 449 49 438 34 35 30 31 26 416 17 17 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 DPS EPS Dividend Payout Ratio ** Book Val
Slide 11: Strong Brand – Product and Service Portfolio
Strong Brand – Product and Service Portfolio Cement Retail B2B 80% 20% Products Base Range Premium Range GBC Bricks Bulk Cement Services Construction Ka B2B Services Doctor & Consumer & Dealer On-site services Mobile Apps & Digital In-store services Services 5
Slide 12: Strong Brand – Product and Service Portfolio
Strong Brand – Product and Service Portfolio Across B2B segments – Mid & High Rise, Roads, Commercial Segment, Other Ready Mix Infrastructure Concrete Products Regular RMX (M5 to M60) Value Added Products Allied Products Dedicated Plants Services Operation and Maintenance Projects Pumping and Liftin
Slide 13: Update on Merger
Act Update on Merger
Slide 14: Update on merger
Update on merger Pursuant to the decision taken by ACC Board on May 5, 2017, a detailed study was undertaken by the Special Committee of Directors to consider the proposed merger of ACC and Ambuja Based on the findings of the study, ACC Board is of the view that: Given the significant scope fo
Slide 15: Proposed Arrangement
Act Proposed Arrangement
Slide 16: Proposed Agreement – Resulting in Immediate Benefits (1/2)
Proposed Agreement – Resulting in Immediate Benefits (1/2) The management is committed to unlocking possible benefits from various areas of synergy between ACC and Ambuja, and thereby create additional value for their shareholders in comparison to the current situation The Board of ACC in the me
Slide 17: Proposed Agreement – Resulting in Immediate Benefits (2/2)
Proposed Agreement – Resulting in Immediate Benefits (2/2) Key Benefits envisaged: The MSA will result in incremental benefits to ACC and Ambuja from respective status quo, and this will be achieved through: optimization of the cost to service market by using each other’s plant capacities where
Slide 18: Scope and Pricing
Scope and Pricing MATERIAL / SERVICE PRICING FORMULA & DELIVERY POINT Cement Manufacturing company’s Average Net Selling Price minus 5% discount, applied in the following manner: (a) In case of ‘FOR Delivery’, the Average Net Selling Price applicable for such FOR Deliveries in the relevant district;
Slide 19: Two premium and complementary brands will continue
Two premium and complementary brands will continue Durability & Trust – Eight Decades Synonymous with strength – Three Decades 100% Awareness & Brand Recall, Category-leading BEI (Brand Equity Index), scores of >5 in relevant retail markets, facilitates strong brand pull for ACC and Ambuja Independe
Slide 20: Timetable
Timetable Events Date File copy of the Postal Ballot Notice with the Stock Exchanges 12/03 (Monday) Date of Commencement of Postal Ballot Voting 17/03 (Saturday) Last date for receiving Postal Ballots by the Scrutinizer 15/04 (Sunday) Submission of Scrutinizer`s Report to the Chairman 16/04 (Monday)
Slide 21: Key take-away messages
Act Key take-away messages
Slide 22: Key take-away messages
Key take-away messages Allows to unlock benefits which are not achievable on a standalone basis Each company benefits incrementally in comparison to its status quo Capitalizes existing platform to create value and increase profitability, with no additional investment No change in the existin
Slide 23: Annexure: Fast growing Indian economy and robust demand drivers for cement
Annexure: Fast growing Indian economy and robust demand drivers for cement
Slide 24: Indian economy projected to grow fastest in 2018 & 2019
Indian economy projected to grow fastest in 2018 & 2019 GDP Growth % (Base: 2011-12) 8.0% 7.3% 7.5% 7.1% 6.5% - 6.75% 2015-16 2016-17 2017-18e 2018-19f 2019-20f Indian economy has strong growth fundamentals and is expected to grow in the range of 7.3%-7.5% over the next two years. Source – World B
Slide 25: Potential drivers for cement demand
Potential drivers for cement demand Recent budget announcements to support cement demand growth in the near to long term Infrastructure & Housing Focus on improving Rural income Affordable housing fund to be set up Increase in Minimum Support Price (MSP) under the National Housing Bank. for khar
Slide 26: Cement Industry – Demand / Supply Scenario
Cement Industry – Demand / Supply Scenario Situation is likely to improve gradually on the back of improved demand & speed of capacity expansion Million Tonnes Demand Growth 5.9% 7.1% 7.2% 7.1% 7.1% 7.0% Demand Available Supply# 17% 16% 17% 20% 18% 22% 496 473 Supply Surplus 449 421 424 387 405 397
Slide 27: ACC – An extraordinary journey
ACC – An extraordinary journey 26
Slide 28: ACC – An extraordinary journey
ACC – An extraordinary journey 27