Welspun Living Limited · NSE:WELSPUNLIV
Welspun Living — Welspun India — Q2 FY21 Earnings Presentation
49 slides from Welspun Living's earnings presentation, Oct 29, 2020
Slide 1: Regulation 30 disclosure cover letter to exchanges
WIL/SEC/2020 October 29, 2020 Bombay Stock Exchange Limited National Stock Exchange of India Limited Department of Corporate Services, ListingCompliance Department SP. J. Towers, Dalal Street, Exchange Plaza, Bandra-Kurla Complex, Mumbai – 400 001 Bandra (E), Mumbai – 400 051 (Scrip Code-514162) (Sy
Slide 2: Investor Deck – Oct'20
Investor Deck – Oct’20 1
Slide 3: Q2 & H1 FY21 Business Performance
Welspun India Limited (WIL) Q2 & H1 FY21 Business Performance 2
Slide 4: Contents
Contents 1. Financial Performance 2. Corporate overview 3. Growth & Value drivers 4. Company & Industry information Employees 25,000+ 3
Slide 5: WELSPUN’
vy WELSPUN’ HEALTH® HERE, WE KEEP SAFETY FIRST, SECOND AND THIRD. Introducing the Welspun Heath range of face mask) which are made untouched by bare hands from manufacturing to delivery. Shop now from oy elspunHome com #MadeToProtect ‘eo aaiable t amazencen ior og | UNM Your time, lo is here! afi Ca
Slide 6: Financial Performance
Financial Performance 5
Slide 7: Key Highlights – Q2 / H1 FY21
Key Highlights – Q2 / H1 FY21 Home Textile revenue grew by Domestic & Global E-Commerce more than 6% YoY & 62% QoQ; business grew by 75% YoY & 4x Highest ever Bed Sheet volume in YoY respectively a quarter Brand Licensing agreement with Domestic B2C business grew by Scott Living for Home category mo
Slide 8: Financial Performance – Q2 / H1 FY21
Financial Performance – Q2 / H1 FY21 (Rs. Million) YoY QoQ YoY Particulars Q2 FY21 Q2 FY20 Q1 FY21 H1 FY21 H1 FY20 Change Change Change Total Income 19,926 18,371 8.5% 12,160 63.9% 32,086 35,682 -10.1% EBITDA 4,048 4,034 0.3% 2,381 70.0% 6,429 7,746 -17.0% EBITDA Margin (%) 20.3% 22.0% -164 bps 19.6
Slide 9: Segment Results – Q2 / H1 FY21
Segment Results – Q2 / H1 FY21 (Rs. Million) YoY QoQ YoY Particulars Q2 FY21 Q2 FY20 Q1 FY21 H1 FY21 H1 FY20 Change Change Change Home Textile Revenue 19,242 18,120 6.2% 11,846 62.4% 31,088 35,298 -11.9% EBITDA 4,215 4,183 0.8% 2,613 61.3% 6,828 7,978 -14.4% EBITDA Margin (%) 21.9% 23.1% -118 bps 22
Slide 10: Financial Performance Trend
Financial Performance Trend (Rs. Million) Particulars FY17 FY18 FY19 FY20 H1 FY21 Total Income 67,211 61,318 66,084 68,362 32,086 Growth % 11.8% -8.8% 7.8% 3.4% -10.1% EBITDA 16,639 12,046 11,467 13,098 6,429 EBITDA Margin 24.8% 19.6% 17.4% 19.2% 20.0% Depreciation 5,054 5,042 4,358 4,811 2,255 Fina
Slide 11: Balance Sheet Trend
Balance Sheet Trend (Rs. Million) Particulars 31-Mar-17 31-Mar-18 31-Mar-19 31-Mar-20 30-Sep-20 Net Worth 23,971 26,057 27,793 29,721 33,195 Short Term Loans 11,721 12,580 14,080 17,717 14,181 Long Term Loans 21,393 20,228 19,024 16,704 15,608 of which Flooring Debt - - 2,870 6,378 6,798 Gross Debt
Slide 12: Financial Ratio Trend
Financial Ratio Trend FY17 FY18 FY19 FY20 TTM Net Debt/Equity 1.27 1.16 1.09 1.00 0.72 Solvency ratios Net Debt/EBITDA 1.83 2.51 2.64 2.26 2.02 EBIT/Interest 7.32 4.98 4.46 4.66 3.78 Current ratio 1.41 1.42 1.25 1.19 1.38 Fixed asset turnover 1.86 1.80 1.81 1.77 1.69 Total asset turnover 0.91 0.84 0
Slide 13: Focus on Free Cash Flow
Focus on Free Cash Flow 5,820 Rs. in Millions FCF Dividend FCF 3,770 2,660 2,405 2,240 1,574 859 785 907 786 773 787 FY16 FY17 FY18 FY19 FY20 H1FY20 H1FY21 FCF positive and utilized for dividend payout 12
Slide 14: Trend of Financial Performance
Trend of Financial Performance TOTAL INCOME EBITDA CAGR 9% CAGR 11% 67,211 66,084 68,362 16,831 16,639 60,143 61,318 54,924 13,691 12,046 11,467 13,098 Rs. million Rs. million 44,772 10,253 36,965 32,086 6,438 6,429 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 H1FY21 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY
Slide 15: Dividend Policy
Dividend Policy Board approved dividend distribution policy Consistent track record 25% of Standalone PAT to be the total payout of dividend distribution (incl. dividend tax if any) Period Standalone EPS DPS Dividend Tax Per Share Payout Percentage FY15 5.09 1.05 0.21 25% FY16 5.99 1.30 0.26 26% FY1
Slide 16: Capital Allocation Strategy
Capital Allocation Strategy It has been our endeavor to allocate capital efficiently in order to enhance stakeholder value. Hence over the last few years our net debt has reduced, even though we have added capacities in various businesses, including our investment in the flooring business. Our strat
Slide 17: Shareholding and Trading Snapshot
Shareholding and Trading Snapshot 17.1% Promoter FIIs 2.1% Shareholding Pattern 5.6% 70.0% Mutual Funds / AIF As on September 30, 2020 5.2% Banks and Insurance Cos Public As on October 29, 2020 INR USD Price per share 73.35 1.0 Market Statistics No of shares outstanding (Mn) 1,005 Market capitalizat
Slide 18: Corporate Overview
Corporate Overview 17
Slide 19: Welspun Group – Global Conglomerate
Welspun Group – Global Conglomerate Global Leader Leading in Large Warehousing Diameter Pipes player Global Leader Infrastructure, in Home Investments in Textiles Oil & Gas Group Revenue Net Fixed Assets Net Debt / EBITDA Employees US$ 2.7Billion US$ 1.0 Billion 0.8x 25,000+ 18
Slide 20: Global Home Textile leader, vertically integrated
Vertically Integrated Thought leader Facilities in Home Textiles Presence in 50+ countries with DC’s in North America, $1 Bn Europe and Asia. Factories in India – Anjar, Vapi, Telangana 30 Patents Global Home Textile leader 41% revenues from Innovative products Bed, Bath, Flooring Trusted Partner Ra
Slide 21: Global Distribution Network with Marquee Clients
Global Distribution Network with Marquee Clients Warehouses Manufacturing Facility Corp HQ/Marketing Offices Country Served Delivery and Reach in over 50 Countries 20
Slide 22: 360 degrees capabilities from Farm to Shelf
360 degrees capabilities from Farm to Shelf Well Researched Innovative Offerings across categories Consumer Research Design Studios in India, US & UK Marketing Support Warehousing and Distribution in India, US & PD and UK with dedicated customer service cell Innovation 3600 Value Chain Management Dr
Slide 23: Growth and Value Drivers
Growth and Value Drivers 22
Slide 24: Growth and Value drivers
Growth and Value drivers Innovation New Channels / Brands Sustainability New Products Markets 23
Slide 25: Well-researched Innovative offerings backed by deep consumer understanding
Well-researched Innovative offerings backed by deep consumer understanding Deep rooted understanding of today’s Consumer needs & behaviors through periodic market research, web scrapping tools & Welspun Braintrust. Real-time “chat” on a social media-like platform, with results Enables us to develop
Slide 26: Thought Leader in Home with robust Innovation portfolio
Thought Leader in Home with robust Innovation portfolio ORGANIC 41% of Sales from Innovative Products Unique mechanism that provides wrinkle resist properties inherent to the product Consumer benefits Impact HYGROCOTTON • Towels softer, fluffier after wash, • Contributes ~$180 Mn of CHARCOAL Charcoa
Slide 27: Evolving into strong B2C player, Expanding Global Brand & License portfolio
Evolving into strong B2C player, Expanding Global Brand & License portfolio India UK / Europe North America Online Dual Brand Strategy Christy as Digital brand (Premium) (Luxury) Sustainability & Own Empowerment (Mass) Innovations Licenses Branded products contributed to ~ 20% revenues in FY20 Globa
Slide 28: Premium Brand 'Spaces': Growing from strength to strength
Premium Brand ‘Spaces’: Growing from strength to strength Brand highlights Brand presence • 2nd most famous brand in premium 2000+ Outlets across 350 category Cities & Towns Presence in 200+ shop-in- • No 1 brand in shop-in-shops shops Brand Positioning : • Best brand in home category at Thoughtfuln
Slide 29: Value Brand 'Welspun': Disrupting Indian home textile market
Value Brand ‘Welspun’: Disrupting Indian home textile market Aiming to be “Har Ghar Welspun” : Focus on tapping mass segment with innovative, functional, value for money products Nation wide presence • 3000+ outlets • 50+ cities • 50+ distributors 2nd most famous brand in the Home Linen mass-market
Slide 30: Welspun Health Readiness: Facility ramp up and all key products are BIS certified
Welspun Health Readiness: Facility ramp up and all key products are BIS certified Products Reusable masks, 3ply surgical FFP2 Respirator Coveralls, launched Anti-microbial range, Disposable face mask (N95 equivalent) Medical Gowns Nanocore masks home linen, Production Wipes capacities 15,000 pcs/day
Slide 31: Luxury brand : Christy
Luxury brand : Christy 170 years old British Luxury Heritage brand Repositioning the brand to attract the millennials Moving from Phygital to Global Digital Brand Christy E-Com continues to grow • 2.2 X YoY Growth • 32% Christy business now from E Comm Strong Wimbledon partnership Virtual Show
Slide 32: 360 approach towards Sustainability & Circularity
3600 approach towards Sustainability & Circularity Ranked amongst top 100 most Sustainable companies in India by Economic Times-Futurescape Sourcing of Raw Materials Recycling / Upcycling Sustainable Plastics Sourcing Recycling Farming Products Projects from Waste Organic Recycled Cotton Cotton PROD
Slide 33: Business strategy and operating model as per SDG & ESG principles
Business strategy and operating model as per SDG & ESG principles, with well-defined roadmap and targets. Base Goal Goal Goal 2019 2022 2025 2030 Areas Becoming Carbon Neutral 10%RE 20%RE 50%RE 100%RE % Sustainable raw materials 23% 35% 50% 100% Becoming Water 18KL/MT (freshwater) 10KL/MT 5KL/MT 0 P
Slide 34: Flooring Solutions : Disrupting the world of Flooring
Flooring Solutions : Disrupting the world of Flooring • Aim to become a one-stop flooring solutions provider • Focus on both Export and Domestic – B2B, B2C Launched industry first Anti-viral range of flooring solutions certified by the Resinnova Labs, US • 50 distributors & ~500 dealers appointed pa
Slide 35: Advanced Textile
Advanced Textile SPUNLACE NEEDLEFELT WET WIPES • Emerging segment of textile products which deals with innovative product applications. • Facility located in Air filtration, EAF (Engine air Anjar, Gujarat (India) Cater to medical disposables, Tailor made for end applications hygiene and cosmetic fil
Slide 36: Ecommerce – Multipronged strategy to drive growth
Ecommerce – Multipronged strategy to drive growth Accelerating growth to capture larger share of the fast-growing market Online Consumer Buying Growing Market Increased E-com traction Strong impetus for growth Growth from Branded & Private Label Growing with Accounts Building Global brands - Premium
Slide 37: Hospitality vertical
Hospitality vertical • Welspun caters to some of the best-known names in the hospitality industry with a suite of innovative products focusing on guest satisfaction. • Caters to hotels, vacation rentals, spas/ resorts, gyms, and health clubs. • Presence in almost 1 million rooms globally Global Alli
Slide 38: Digital Transformation across Organisation
Digital Transformation across Organisation Manufacturing Supply Chain Sourcing Product Management Sales & Marketing Digital Customer E-Sourcing Industry 4.0/Smart Factory Collaborative E-PLM E-Documentation Engagement E-Procure to Pay Freight Tiger E-Commerce initiatives (Cloud based) Analytics, Pow
Slide 39: Company & Industry Information
Company & Industry Information 38
Slide 40: Key Milestones
Key Milestones Revenue (Rs Bn) CAGR 13% 68 61 53 32 Began Operations 3.5 4.5 16 FY 1985 1993 1995 2005 2006 2008 2012 2014 2015 2016 2017 2018 2019 2020 Began the Acquired Christy – Embarked upon Commissioned Established journey in Most prestigious capacity expansion India’s largest industry definin
Slide 41: Vertically Integrated presence with Significant Capabilities
Vertically Integrated presence with Significant Capabilities Vertically Integrated facilities across Manufacturing value chain Current Capacities Spinning Weaving Processing Cutting & Sewing Logistics Bed Linen & Filled Rugs & Carpets Towels Bedding Tufting (‘000 MT) (‘Mn mtrs) (‘Mn sq. mtrs) Extrus
Slide 42: Experienced Board & Management with Proven Track Record
Experienced Board & Management with Proven Track Record Board of Directors Management Team Rajesh Mandawewala, Managing Director; Member of Board B. K. Goenka, Chairman • Qualified Chartered Accountant; Played an instrumental role in establishing Welspun’s Textile & Pipe business • Amongst India’s m
Slide 43: Awards & Accolades – Testimony of Excellence
Awards & Accolades – Testimony of Excellence ET- Futurescape Walmart Macy’s IKEA Sustainability & CSR Sustainability Sustainability Innovation Amongst Top 100 GIGA GURU Status Supplier Partner for the Innovation partner Companies in India (2020) Energy Conservation (2019) year (2019) for Home catego
Slide 44: Inclusive Growth: Corporate Social Value
Inclusive Growth: Corporate Social Value ENVIRONMENT & HEALTH EDUCATION • Clean water, Improved sanitation, • Our initiative to improve the better Infrastructure quality of education at • COVID awareness, Mask grassroots distribution, Immunity boosters. • Impacts over 170+ schools, • 144 women entre
Slide 45: Creating an Inclusive workplace and society
Creating an Inclusive workplace and society 25% women in ~20,000 workforce which was just 7% a decade ago W2 unit run solely by 700+ Menstrual Hygiene program Supporting deserving Sportswomen empowered women 410+ entrepreneurs, 200+ villages 25 athletes,150+ medals won Akankshita Center Women entrep
Slide 46: Our operations running full throttle with all safety protocols
Our operations running full throttle with all safety protocols Advantages of our vertically integrated facilities Taking care of Health and Safety of workforce • Farm to Finish operations/ Composite mill • Worker’s colony in factory vicinity • Cotton warehouse – coverage for 6 months • On site Vendo
Slide 47: Global Market Opportunity
Global Market Opportunity Global Home Textile Market US Home Textile Market (2019) Market Composition USD Bn USD Bn $ 0.3 Row CAGR $ 5.2 Cotton Pillowcases 25% 6.6% 242 Other Non-cotton Products $ 1.4 145 Cotton Sheets 80 $ 2.9 US $ 1.6 31% 48 Other Cotton Products Cotton Towels $ 1.0 2017 2025E $ 4
Slide 48: Disclaimer
Disclaimer The information contained in this presentation is provided by Welspun India Limited (the “Company”), although care has been taken to ensure that the information in this presentation is accurate, and that the opinions expressed are fair and reasonable, the information is subject to change
Slide 49: THANK YOU
THANK YOU For further details, please contact Sanjeev Sancheti President (Finance) & CFO Welspun India Limited Email: sanjeev_sancheti@welspun.com Vipul Garg Group Finance & Strategy (Investor Relations) Email: vipul_garg@welspun.com http://www.welspunindia.com/