Spencer's Retail Ltd. · NSE:SPENCERS
Spencer's Retail — Investor's Conference meetings, Mumbai (May 2019)
31 slides from Spencer's Retail's conference presentation, May 20, 2019
Slide 1: Cover letter to stock exchanges: Investor Presentation
\Nt RP- Sanjiv Goenka s encer's -d41, Group MAKES FINE LIVING Ofirloble Growing Legacies SRL:SEC:SE: 2019-20/38 20 May, 2019 Manager (Listing) National Stock Exchange of India Limited (Symbol: SPENCERS) Exchange Plaza, 5th Floor Plot No. C/1, G-Block Bandra-Kurla Complex Bandra (East) Mumbai — 400 0
Slide 2: Spencer's Retail Limited Investor Presentation May 2019
Spencer's Retail Limited Investor Presentation May 2019
Slide 3: Disclaimer
Disclaimer This presentation is issued by Spencer's Retail Limited (the "Company") for general information purposes only, without regard to specific objectives, suitability, financial situations and needs of any particular person. This presentation does not constitute or form part of any offer or in
Slide 4: Table of Contents
Table of Contents #1 Company Snapshot #2 Key Differentiators #3 Annexure #3
Slide 5: Company Snapshot
Table of Contents #1 Company Snapshot #2 Key Differentiators #3 Annexure #4
Slide 6: RP-Sanjiv Goenka Group: Diversified Business House
RP- Sanjiv Goenka Group Diversified Business House FY 19 Operating Revenue (₹ Cr.) Fully integrated private power utility company engaged in coal mining, 10868 generation and distribution of electricity to city of Kolkata One of top 3 BPO players in India 3.826 Largest Indian & 7th largest global ca
Slide 7: Business Snapshot: Spencer's
Business Snapshot: Spencer's India's oldest retailer since 1863 ₹ 2,187 Cr. 156 39 FY19 Operating # of total stores # of Cities Revenue FY19 Present in ~ 1.4 mn sq. ft. ~ 81% 21.24% FY19 Retail Business Share of Food & FY19 Gross Area FY19 Grocery in Margin Revenue ₹ 714 ~ 33 mn 8 # of Cities Presen
Slide 8: Spencer's Retail: Evolution of the Business
Spencer's Retail: Evolution of the Business 2006-2009: Spencer's brand 2009 -2016: Consolidation by 2016 onwards: 1989-2005: Introduced launch and rapid shutting down non-performing Focus on Modern Retail to India expansion stores profitable growth RPG 1st hypermarket Change in Change in bra
Slide 9: Key Differentiators
Table of Contents #1 Company Snapshot #2 Key Differentiators #3 Annexure #8
Slide 10: Key Strategic Pillars
Key Strategic Pillars #1 Profitable Growth in chosen Geographies #2 Optimal Product Mix ~ Increasing share of High Margin Categories #3 Differentiated and Diversified Private Label Program Targeting a Well-Defined Customer-Base ~ Diverse and Differentiated #4 Product Offerings & Superior Customer Ex
Slide 11: Profitable Growth in Chosen Geographies
Profitable Growth in Chosen Geographies Profitable Growth Trading Area & No. of Stores Trend 4.00 15.00 24% 13.00 3.00 Optimal Mix 11.00 2.00 NORTH 9.00 46 Stores 1.00 7.00 0.00 5.00 Private Label FY15 FY16 FY17 FY18 FY19 Opened Stores 0.76 1.63 1.21 0.59 2.09 Closed Stores 0.90 1.32 0.09 0.37 - Tot
Slide 12: Hybrid Format Approach
Hybrid Format Approach Led by Large Format Stores to drive profitability and improve margins Profitable Growth FY19 # of # of Cities Average Store Typical Mix of Revenue Key Differentiators Stores Present in Area Assortment Share Optimal Mix Destination format 21% Large Format Offers all categorie
Slide 13: Optimal Product Mix
Optimal Product Mix Increasing share of High Margin Categories Profitable Growth General Merchandise, Apparel and Foods Non-Foods (FMCG) Electrical & Electronics Share of FY19 Revenue Share of FY19 Revenue Share of FY19 Revenue Optimal Mix 63% 18% 19% Private Label Snacks Groceries Footwear Customer
Slide 14: Continued Focus on Increasing Share of High Margin Categories
Continued Focus on Increasing share of high margin categories Profitable Growth Boost the overall margin Improving margins of Non-Food Categories Increasing strength in Non-Food categories especially Apparels – 2Bme Brand Ambassadors – Ranbir Kapoor Optimal Mix and Shraddha Kapoor – International
Slide 15: Diverse and Differentiated Product Offerings
…And Diverse and Differentiated Product Offerings Differentiated Offerings Separates Spencer's from Other Retailers Profitable Growth "Spencer's Gourmet" offers a wider range of assortment from different parts of the world Optimal Mix "Spencer's Patisserie" is an in-store live bakery offering freshl
Slide 16: Well Differentiated and Diversified Private Label Program
Well Differentiated and Diversified Private Label Program Delighting customers with wide range of quality products through our own brands Pan- India Network Portfolio of Private Labels Key Highlights Apparel Target Customer 1,400+ # of SKUs across categories Private Label FMCG 12.5% Category Mix Con
Slide 17: Targeting a Well-Defined Customer-Base
Targeting a Well-Defined Customer-Base… Profitable Growth 2017 14% Share of Working Age The proportion of nuclear Population 19% Optimal Mix households has reached 70% 16% and is projected to increase to 25% 74% by 2025 50-64 26% 28% Nuclear families spend 20% to 30% Years Private Label 36-49 mo
Slide 18: Increasing Customer Stickiness
…And Increasing Customer Stickiness… Profitable Growth Steadily increasing base of Loyal customers* … 0.62 0.64 0.63 0.58 0.47 Optimal Mix 0.35 0.30 0.28 Private Label Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY19 Loyalty Customer Base (mn) Customer Base Activities ensuring high cr
Slide 19: Efficient Operations
…And Efficient Operations Efficient In-store Management along with Centralized Control Ensuring Lean Cost Structure Profitable Growth In-store Management Supply Chain Efficiency Defined store work plan to ensure Lean cost structure with centralized replenishment control standardization across stor
Slide 20: Growing Omni Channel Presence
Growing Omni Channel Presence Profitable Growth E-Commerce Presence ~425,000 customers base, increasing rapidly on month on month basis Optimal Mix Private Label Substantially low cost of customer acquisition ~ ₹ 90 per customer Customer Base E-Commerce Growth Sales Rs in Cr Retention rate of ~70% 8
Slide 21: Annexure
Table of Contents #1 Company Snapshot #2 Key Differentiators #3 Annexure #20
Slide 22: Standalone Financials: Spencer's Retail Limited
Standalone Financials: Spencer's Retail Limited 3 months ended Growth 12 months ended Standalone (₹ Cr) 31-Mar-19 31-Dec-18 31-Mar-18 Y-o-Y Q-o-Q 31-Mar-19 31-Mar-18 * 10 9 2 New Stores added 29 7 156 146 127 23% 7% Total Store count 156 127 0.70 0.53 0.03 TA added (Lac sq.ft) 2.08 0.59 13.69 12.97
Slide 23: Standalone Financials: Spencer's Retail Limited
Standalone Financials: Spencer's Retail Limited As at Standalone (₹ Cr) 31-Mar-19 31-Mar-18 * A) Assets Assets 646 634 Inventories 270 242 Total Assets 916 877 B) Equity & Liabilities Equity 596 590 Debt - - Other Liabilities 53 45 Trade Payables (Net) 267 242 Total Equity & Liabilities 916 877 * Pu
Slide 24: Operational Performance: Spencer's Retail Limited
Operational Performance: Spencer's Retail Limited Sales /sqft (₹/month) SSSG (%) 1,576 9.9% 1,519 1,521 8.9% 8.4% 1,452 1,349 3.10% -1.10% FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19 Sales /sqft (₹/month) SSSG (%) Average Bill Value (₹ /bill) Number of Bills (Lakhs) 723 324 714 695 309 645 299
Slide 25: Corporate Governance
Corporate Governance Diverse Board Robust Management Team Balanced mix of independent and professional Continuous review of performance of directors management team and guidance by Board to Board is guided by the following committees ensure improvement ─ Audit Committee with majority independe
Slide 26: Robust Management Team
Robust Management Team Shashwat Goenka Devendra Chawla Non – Executive Director Managing Director & CEO Alumni of The Wharton School of The University of Pennsylvania BE, MBA and Alumni of Harvard Business School Heads retail business of RP-Sanjiv Goenka group 22+ years of experience compris
Slide 27: Retail Industry in India
Retail Industry in India India is a consumption-led economy with private consumption Retail forms ~55% of private consumption in India forming ~60% of the GDP Private Consumption (USD tn) India's GDP grew at Organized 7% 9% 13% Retail Share 7.1% in FY17 and is USD bn expected to grow at same pace
Slide 28: Key Growth Drivers
Indian Food & Grocery Market: US$ 474 bn Opportunity Food & grocery to lead the growth in overall retail Organised food & grocery market to grow ~2.5x in 4 years USD bn USD bn 1,106 FY17-21E Organised 79 CAGR Unorganised 728 Others 49 75 41 26.7% 91 Home & Living 710 85 ~2.5x 53 474 Consumer Electro
Slide 29: Top States Contributing ~64% to India's Retail Expected to Grow at 11.3% CAGR
Top 10 States, Contributing ~64% to India's Retail, are Expected to Grow at 11.3% CAGR Retail Spending in Select States Punjab 18 | 27 Haryana Delhi & NCR^^ 27 | 43 30 | 48 Rajasthan Uttar Pradesh 51 | 75 Bihar 30 | 44 18 | 35 Gujarat Madhya Pradesh West 45 | 68 22 | 35 Bengal 33 | 49 Maharashtra 10
Slide 30: Modern Trade Sees Growth in Shoppers Visit
Modern Trade Sees Growth in Shoppers Visit Driven by Increased Visits to Hypermarkets 2013 2014 2015 2016 2017 Hypermarket 14% +4 18% -6 12% +3 15% +16 31% pectiv rade Supermarket 35% +5 40% -8 32% +13 45% +6 51% Modern Trade (Any Hypermarket/ 44% +2 46%` -9 37% +13 50% +13 63% Supermarket) Traditio
Slide 31: Thanks
Investor Presentation Thanks
Spencer's Retail — Investor's Conference meetings, Mumbai (May 2019) on 6ix