Grasim Industries Ltd. · NSE:GRASIM
Grasim Industries — Q1 FY2011-12 Earnings Presentation
39 slides from Grasim Industries's earnings presentation, July 2011
Slide 1: Performance Review Quarter 1: 2011-12
Performance Review Quarter 1 : 2011-12 Grasim Industries Limited A Cement and VSF Major
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
Slide 3: Contents
Contents z Highlights z Business Review z Financial Performance z Capex Plan z Summary 3
Slide 4: Highlights – Quarter 1 (Operational)
Highlights – Quarter 1 OPERATIONAL z Both VSF and Cement businesses show better performance over last year z In VSF Business ¾ After reaching peak in April, market shows signs of weakness with sharp decline in cotton prices and Chinese demand ¾ Volumes also impacted as buyers preferred to reduce pip
Slide 5: Highlights – Quarter 1 (Strategic)
Highlights – Quarter 1 STRATEGIC z Continue to pursue growth plans to maintain momentum in both businesses z Acquisition of 1/3 stake in Swedish Pulp Company “Domsjo” completed ¾ Consolidated results include pro-rata profits of Domsjo from 13th June, 2011 z VSF expansion (Vilayat, Gujarat and Hariha
Slide 6: Business Review
Business Review VSF Chemical Cement Subsidiary 6
Slide 7: Viscose Staple Fibre : Highlights
Viscose Staple Fibre : Highlights Global Industry Scenario Quarter – 1 % Chg. z Quarter started on strong note 2011-12 2010-11 z However, led by cotton, prices of all fibres correct Capacity (TPA) 333,975 333,975 --- sharply from peak levels witnessed in the quarter z In the downward trend, user red
Slide 8: Viscose Staple Fibre : Highlights (Contd….)
Viscose Staple Fibre : Highlights (Contd….) Quarter – 1 z On Standalone basis, PBIDT up by 15% % Chg. 2011-12 2010-11 z Operating margin improved from 35% to PBIDT (` Cr.) 349.8 304.2 15 38% with increase in input cost passed on PBIDT Margin (%) 38.5% 35.3% -- fully PBIT (` Cr.) 324.2 278.0 17 ROAvC
Slide 9: Viscose Staple Fibre : Outlook
Viscose Staple Fibre : Outlook z Slackness in demand will affect Q2 performance ¾ Expected to recover gradually thereafter z Profitability in the short term will be governed by the prices of competing fibres, input and energy costs ¾ Margins on decline due to softening of prices ¾ Cotton production
Slide 10: Chemical : Highlights
Chemical : Highlights Quarter – 1 Industry Scenario % Chg. 2011-12 2010-11 z Caustic prices showed positive trend Caustic Capacity (TPA) 258,000 258,000 - ¾ Better sentiment in international markets Production (MT) 57,381 54,693 5 Sales Volumes (MT) 54,424 54,386 -- ¾ Temporary outage of competitors
Slide 11: Cement : Industry Scenario
Cement : Industry Scenario 350 Mn. Tons Industry Capacity 304 308 z Cement Industry continued to be affected by 300 276 excess capacity 250 216 ¾ Cement capacity at ~ 308 Mn. MT in June’ 11 198 200 168 ¾ Industry added ~ 40% capacity in last two years 150 z Growth slowdown continued in Q1FY12 100 at
Slide 12: Cement : Highlights
Cement : Highlights Quarter -1 % Chg. z Capacity increased to 51.75 Mn. Ton YoY 2011-12 2010-11 ¾ 3 Mn. Ton Star Cement acquisition Grey Cement Capacity Mn. TPA 51.75 48.75 6 completed in Sep’ 10 Production Mn. MT 10.32 9.92 4 z Overall volume growth of 5% led by $ Cement Sales Volumes Mn. MT 10.34
Slide 13: Cement : Financials
Cement : Financials Quarter -1 z Net Revenue increased by 16% % Chg. 2011-12 2010-11 ¾ Acquisition of Star Cement Realisation `/MT ¾ Improved RMC and White Cement - Domestic Cement 3,935 3,504 12 - Clinker 1,741 1,533 14 performance - White Cement 8,943 7,916 13 ¾ Passing of cost increase Net Revenu
Slide 14: Cement : Outlook
Cement : Outlook z Cement Demand expected to grow at >7.5% from H2FY12 onwards ¾ Expected improvement in infrastructure spending ¾ Rural demand emanating from good agricultural growth z Surplus scenario may last for next 2-3 years z Selling price under pressure with onset of monsoon ¾ Q3 onwards, ri
Slide 15: Financial Performance
aN ll 7 ee GRASIM Financial Performance 15
Slide 16: Consolidated Revenue
Consolidated Revenue 59 16% 46 70 643 5937 ` Crore 5119 Quarter 1 Cement VSF Pulp JVs Chemical,Textile Quarter 1 2010-11 & Inter Co. 2011-12 Eliminations 5,119 643 46 70 59 5937 All businesses contribute to revenue growth 16
Slide 17: Revenue Chart
Revenue Chart ` Crore Quarter -1 Net Revenue 2011-12 2010-11 Viscose Staple Fibre 902 856 5% Chemical 153 119 29% Others 25 19 Inter Segment Eliminations (Intra Company) (36) (29) Standalone Net Revenue 1,044 964 8% Subsidiaries UltraTech Cement * 4,617 3,974 16% Grasim Bhiwani Textiles Ltd. 84 75 1
Slide 18: Financial Performance – Quarter 1
Financial Performance – Quarter 1 18
Slide 19: Consolidated PBIDT
Consolidated PBIDT 43 19% 25 46 170 1748 ` Crore 1464 Quarter-1 Cement VSF Pulp JVs Chemical & Quarter -1 2010-11 Others 2011-12 1,464 170 46 25 43 1748 All businesses contribute to PBIDT growth 19
Slide 20: PBIDT – Chart
PBIDT – Chart ` Crore PBIDT Quarter -1 2011-12 2010-11 Viscose Staple Fibre 350 304 15% Chemical 35 31 11% Others 70 25 Standalone PBIDT 454 361 26% Subsidiaries UltraTech Cement Ltd. 1,259 1,089 16% Grasim Bhiwani Textiles Ltd. 5 5 Others 0.3 0.4 Joint Ventures (Pro Rata) Pulp JVs (45%) and Fibre J
Slide 21: Net Profit
Net Profit ` Crores Quarter -1 2011-12 2010-11 Total Net Grasim's Total Net Grasim's Profit share Profit share Standalone Reported PAT 314 224 40% UltraTech Cement (60.34%) 669 404 560 339 Grasim Bhiwani Textiles (100%) 1 1 1 1 Pulp (45%) and Fibre (31%) JVs / Associate (33%) 57 27 (2) 0.4 Idea Cell
Slide 22: Grasim Financials
Grasim Financials Standalone Consolidated Full Year Quarter 1 Full Year Quarter 1 ( ` Crore) 2010-11 2011-12 2010-11 2011-12 Net Worth 8,134 8,449 14,573 15,334 Debt 814 777 6,783 6,751 Capital Employed 9,177 9,458 27,669 28,674 Debt:Equity (x) 0.10 0.09 0.36 0.34 Interest Cover 30.3 34.1 10.8 14.7
Slide 23: Capex
ADITYA BIRLA GRASIM Capex 23
Slide 24: Capex plan
Capex plan ` Crore Net Capex Cash Outflow Capex to be spent spent as FY12 FY13 during on 01.04.11 Onwards Quarter 1 VSF Business 2,095 – Expansion Projects: Vilayat (120K TPA), Harihar (36K TPA) - Other Capex 340 Chemical Business – Vilayat (182K TPA) 756 Balance Capex (Including normal capex for ch
Slide 25: Summary
aN ll 7 ee GRASIM Summary 25
Slide 26: Summary
Summary z Both the businesses – Cement and VSF performed well ¾ However, Difficult Market Conditions creating pressure in both the businesses ¾ Should emerge stronger in difficult conditions with cost efficiency and continuous improvement plans z Capacity expansions under implementation in both busi
Slide 27: Plant Locations – Grasim & its subsidiaries
Plant Locations– Grasim & its subsidiaries Bathinda(G) Panipat Bhiwani Dadri T Kotputli Aligarh Jodhpur T Malanpur Shambhupura Jawad Bharuch Durgapur(G) UltraTech Cement Plants F Jafrabad Magdalla (G) UltraTech Grinding Units (G) F C Pipavav Nagda Hirmi Raipur Awarpur B UltraTech Bulk Cement Termina
Slide 28: Thank You
ADITYA BIRLA GRASIM Thank You
Slide 29: Annexure
Grasim Industries Limited Annexure
Slide 30: Annexure
Annexure Consolidated Financial Performance Standalone Financial Performance Consolidated and Standalone Financial Consolidated and Standalone Profitability Businesswise Performance VSF Summary Chemical Summary Cement Summary 30
Slide 31: Consolidated Financial Performance
Consolidated Financial Performance (` Crore) Quarter - 1 Full Year % Chg. 2011-12 2010-11 2010-11 Net Turnover & Op. Income 5,936.5 5,118.5 16 21,585.2 Other Income 108.5 96.3 13 397.4 PBIDT 1,748.4 1,463.7 19 5,396.7 Interest 94.2 91.2 3 405.6 Gross Profit 1,654.2 1,372.4 21 4,991.2 Depreciation 28
Slide 32: Standalone Financial Performance
Standalone Financial Performance (` Crore) Quarter - 1 Full Year % Chg. 2011-12 2010-11 2010-11 Net Turnover & Op. Income 1,043.9 964.5 8 4,645.9 Other Income 80.4 39.8 102 297.8 PBIDT 453.9 360.5 26 1,817.1 Interest 10.6 10.2 4 45.6 Gross Profit 443.3 350.3 27 1,771.5 Depreciation 35.1 44.5 (21) 17
Slide 33: Financial Snapshot
Financial Snapshot Standalone Consolidated March March March June March March March June ( ` Crore) 2009 2010 * 2011 * 2011 * 2009 2010 2011 2011 Gross Block (Incl. CWIP) 12,280 3,145 3,085 3,284 21,044 21,717 24,166 24,986 Net Block (Incl. CWIP) 8,308 1,829 1,643 1,808 14,219 14,553 15,791 16,341 G
Slide 34: Profitability Snapshot
Profitability Snapshot Standalone Consolidated Quarter 1 Quarter 1 ( ` Crore) 2008-09 2009-10 * 2010-11* 2008-09 2009-10 2010-11 2011-12* 2011-12 Gross Turnover 12,097 8,842 4,891 1,112 20,325 21,711 23,571 6,516 Net Turnover & Op. Income 10,965 8,313 4,646 1,044 18,496 20,195 21,585 5,937 PBIDT 2,8
Slide 35: Consolidated Businesswise Performance - Quarter 1
Consolidated Businesswise Performance - Quarter 1 (` Crore) ROAvCE (%) Business Revenue PBIDT PBIDT Margin (%) PBIT Capital Employed (PBIT basis) 2011-12 2010-11 2011-12 2010-11 2011-12 2010-11 2011-12 2010-11 2011-12 2010-11 2011-12 2010-11 Cement * 4,617 3,974 1,259 1,089 27.1 27.0 1,023 875 20,77
Slide 36: Viscose Staple Fibre : Summary
Viscose Staple Fibre : Summary Quarter -1 Full Year % Chg. 2011-12 2010-11 2010-11 Capacity TPA 333,975 333,975 - 333,975 Production MT 69,898 69,328 1 305,087 Sales Volumes MT 54,839 67,302 (19) 305,072 Net Revenue ` Crs. 901.6 856.1 5 4,169.5 Avg. Realisation `/MT 152,409 117,910 29 126,614 PBIDT
Slide 37: Chemical : Summary
Chemical : Summary Quarter -1 Full Year % Chg. 2011-12 2010-11 2010-11 Capacity TPA 258,000 258,000 -- 258,000 Production MT 57,381 54,693 5 242,037 Sales Volumes MT 54,424 54,386 - 241,365 Net Revenue ` Crs. 153.4 118.7 29 542.3 Avg. Realisation `/MT 22,605 18,455 22 18,720 PBIDT ` Crs. 34.6 31.1 1
Slide 38: Cement : Summary
Cement : Summary Quarter -1 Full Year % Chg. 2011-12 2010-11 2010-11 Grey Cement Capacity Mn. TPA 51.75 48.75 6 51.75 Production Mn. MT 10.32 9.92 4 39.67 $ Cement Sales Volumes Mn. MT 10.34 9.85 5 39.96 Clinker Sales Volumes Mn. MT 0.37 0.45 (18) 1.60 White Cement Production MT 120,982 133,015 (9)
Slide 39: Cement : Summary Contd…
Cement : Summary Contd… Quarter -1 Full Year % Chg. 2011-12 2010-11 2010-11 Realisation `/MT - Domestic Cement 3,935 3,504 12 3,434 - Clinker 1,741 1,533 14 1,617 - White Cement 8,943 7,916 13 8,265 Net Revenue ` Crs. 4,617.3 3,973.6 16 15,969.1 PBIDT ` Crs. 1,258.7 1,088.8 16 3,483.2 PBIDT Margin %
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