Kiri Industries Limited · NSE:KIRIINDUS
Kiri Industries — Investor Presentation (June 2019)
47 slides from Kiri Industries's investor presentation, Jun 6, 2019
Slide 1: Intimation of Investor Meet cover letter
CD Kiri Industries Limited ~ {i:ft c{ c~ t<Y. •••• June 06, 2019 To, To, BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers Exchange Plaza, Dalal Street Bandra Kurla Complex, Mumbai- 400001 Bandra (E), Mumbai - 400 051 Scrip Code: 532967 Scrip ID: KIRIINDUS Dear Sir/Madam
Slide 2: Investor Presentation | June 2019
Kiri Industries Limited (CIN:L24231GJ1998PLC034094) INVESTOR PRESENTATION | JUNE 2019
Slide 3: Executive Summary
2 Executive Summary PRODUCTS INDUSTRIES CATERED FINANCIAL HIGHLIGHTS* Dyes Intermediates For Dyes intermediates TOTAL REVENUE H-acid • Various INR 13,965 Mn Vinyl Sulphone manufacturers of Specialty Intermediates reactive dyes across 3 Year - CAGR Naphthalene and Aniline the globe. 10.23% based inte
Slide 4: Company Overview
<< AOS 2 COMPANY OVERVIEW
Slide 5: Company Overview
4 Company Overview • Established in 1998, Kiri Industries Limited (KIL), Consolidated Revenue Break-up (INR Mn) is based out of Gujarat and has emerged as one 5,759 of the largest manufacturers and exporters of a 4,517 4,722 wide range of Dyes, Dyes Intermediates and 3,681 4,117 Basic Chemicals from
Slide 6: Management Team
5 Management Team Pravin Kiri (Chairman) • He is a science graduate from Gujarat University and started his career in the year 1966 by associating himself with Jay Chemical Industry (Kharawala Group) as a partner and was responsible for all the technical matters of the group. • He has a wide interes
Slide 7: Key Milestones
6 Key Milestones Two-Star Export House Entered into a Achieved highest Commercial JV Agreement PAT since Obtained with Well Filed inception Environmental production Prospering minority Clearance for of Singapore Court Incorporat Ltd. for oppression further backward Acquisition DyStar delivered ion o
Slide 8: Manufacturing Facilities
7 Manufacturing Facilities Unit I, Unit II & IV Unit V Location: Ahmedabad, India. Location: Vadodara, India. Products manufactured: Products manufactured: • S. O. Dyes • Sulphuric acid • Disperse Dyes • Oleum • Chloro-sulphonic acid along with 3.3 MW steam Capacity Installed: based power plant • Re
Slide 9: Manufacturing Process
8 Manufacturing Process Key Inputs Ice Napthalene Sulphur Sodium Nitrate Soda Ash Water Aniline Caustic Soda Chlorine Sulphur & Bulk Chloro Chemicals Para Nitro Sulphuric Oleum 65% Sodium Bi Thionyl Beta-Nepthol Sulphonic Acetanilide MPD Aniline Acid Oleum 23% Sulphate Chloride Division Acid Vinyl S
Slide 10: Geographical Presence
9 Geographical Presence AHMEDABAD THE NETHERLANDS VADODARA CZECH REPUBLIC UK BELGIUM SPAIN HUNGARY ITALY KOREA USA PORTUGAL TURKEY CHINA PAKISTAN TUNISIA SYRIA NEPAL IRAN TAIWAN BANGLADESH INDIA EGYPT HONG KONG THAILAND HONDURAS ECUADOR COTE D'IVOIRE SRI LANKA KENYA SINGAPORE INDONESIA DEMOCRATIC RE
Slide 11: Awards and Accolades
10 Awards and Accolades Award for Export performance of Award for Direct Export Platinum Award for Trishul Award for Chemexcil Gold Award - more than INR 6 Cr for Direct export of Self Manufactured Small Scale Sector - Small Scale Sector - 2006-07 of Self Manufactured Dye and Dye Dyes - 2000-01 2002
Slide 12: Key Strengths
11 Key Strengths • High entry barriers due to a stringent • The Company established a track record process of acquiring new permissions. of long-term relationship with key global • Heavy capital expenditure. names and the ability to pass on price • Strict implementation of environmental increases. a
Slide 13: Business Overview
BUSINESS OVERVIEW
Slide 14: Business and Product Mix
13 Business and Product Mix Revenue Break-up (FY14) Thionyl Chloro Chloride Other Basic Chemicals Sulphonic Speciality 1% Acid Chemical Oleum Dyes Vinyl 43% 65% & Intermediates Sulphone 23% Dye 56% Basic Intermedia Chemicals tes 3% 55% Sulphuric H Acid Dyes Acid Revenue Break-up (FY19) 42% Basic Che
Slide 15: Value Chain – Dye Stuff Manufacturing
14 Value Chain – Dye Stuff Manufacturing Aniline Naphthalene In-house Acids and Usage of Raw Materials for Dyes Intermediates such as VS, H-Acid, B-Napthol MPD, etc. effluents & by-products Gamma Acid, K-Acid MUA, etc. Result of Zero Waste Dyes Inputs Intermediates Manufacturing process Dyestuffs Blac
Slide 16: Benefits of Zero Waste
15 Benefits of Zero Waste • The Company’s focus on becoming a Operating Zero Waste company has ensured Efficiency Superior that Spent Acids are a source of Entry Return Ratios Barrier revenue (converted into commercially viable products) and not a source of expense (frees the hassles of management and
Slide 17: Dyestuff – An Overview
16 Dyestuff – An Overview Dyestuff are organic and inorganic substances which can absorb light as well as reflect some Total Revenue (INR Mn) & Gross light to show colour. The dyestuff is also a water soluble substance. Margins Criteria for a Suitable Dyestuff 26% • Economical / Competitive 22% 23%
Slide 18: Dyestuff Manufacturing Process
17 Dyestuff Manufacturing Process Diazotization of Amine + HCl + Sodium Nitrite + Water + Ice Dissolving of Coupling Coupling of Component Diazo with Blending and (Coupling Coupling Clarification Standardization Spray Drying fine Packing Component + Components + standardization Water + Ice + NaHCO3
Slide 19: Reactive Dyes
18 Reactive Dyes • Reactive Dyes are the most versatile and popular class of Organic Dyes for importing colour on cellulosic fibres. • These are water soluble dyes which react to fibre, forming a direct chemical linkage with the application materials, which is not easily broken and offers good wash
Slide 20: Disperse Dyes
19 Disperse Dyes Disperse dye: • Disperse dyes are synthetic organic dyes and is a kind of organic substance which is free of ionizing group. They are less soluble in water and are used for dyeing synthetic textile materials. Disperse dyes are mainly used for dyeing polyester yarn or fabric. • For d
Slide 21: Other Dyes
20 Other Dyes Acid Dyes • Acid dyes are the dyes which can be applied directly to the application materials from an aqueous solution (without mordant). • The Company has been working on developing Acid dyes since a decade. It has been manufacturing this range of dyes for a long time. • Colours Avail
Slide 22: Dyes Intermediates
21 Dyes Intermediates • Dyes intermediates are the main raw materials used for manufacturing dyestuffs. Total Revenue (INR Mn) & Gross • The manufacturing chains of dyes and dyes intermediates can be traced back to Margins petroleum-based products. 46% 43% 38% 39% • Naphtha and natural gases are use
Slide 23: Dyes Intermediates – H-Acid
22 Dyes Intermediates – H-Acid H-Acid • H-acid is one of the leading dyes intermediates in the world, used in the manufacture of black dyes. • H-acid (8-amino- 1-hydroxynaphthalene-3,6-disulfonic acid), an important dye intermediate, is produced from Naphthalene by a combination of the unit processe
Slide 24: Dyes Intermediates – Vinyl Sulphone
23 Dyes Intermediates – Vinyl Sulphone Vinyl Sulphone • Vinyl Sulphone is an industrial chemical used as a key raw material for manufacturing reactive dyes, having application mainly in textiles. It is manufactured from aniline. • It has applications in manufacturing of Reactive dyes. • The Company
Slide 25: Basic Chemicals
24 Basic Chemicals • As part of strategic backward integration, the Company has set up Basic Chemical facility Total Revenue (INR Mn) & Gross to manufacture: Margins • Sulphuric Acid 35% 36% 36% • Oleum 32% • Chloro Sulphonic Acid 25% • Thionyl Chloride 20% • All these products are made in one integ
Slide 26: Future Outlook
25 Future Outlook • The Company has envisaged continuing capital investments in FY20 for expansions of manufacturing facilities of specialty intermediates and basic chemicals at Padra, Vadodara. • After completion of said expansions installed capacity of Specialty Dyes Intermediates shall increase b
Slide 27: DyStar
DYSTAR
Slide 28: About DyStar
27 About Dystar Total Revenue (USD Mn) 1,129 1,016 938 898 KIL acquired DyStar in 2010, along with Zhenjiang 822 871 Longsheng holding 37.57% presently • The DyStar Group is a leading dyestuff and chemical manufacturer and solution provider, offering a broad portfolio of colorants, specialty chemica
Slide 29: History
28 History COLORATION SPECIALIST FOUNDATION JOINT VENTURE OF: ACQUISITION: Bayer AG and Emerald Hoechst AG Performance (Textile dyes, ACQUISITION: FOUNDATION: Materials SOLUTION Ind. Color Solutions ACQUISITION: Sustainable Specialities SUSTAINABILITY LEADER PROVIDER Mitsubishi) International Texani
Slide 30: Value Creation in DyStar
29 Value Creation in DyStar Successfully turning around the operations of DyStar • The turn-around plan was successfully executed by replacing high cost German manufacturing base with low cost manufacturing in India, China and Indonesia, etc. • KIL is entitled to profit shares of INR 826 Mn, INR 1,9
Slide 31: Industry Overview
INDUSTRY OVERVIEW
Slide 32: The Colourant Industry
31 The Colourant Industry • Global colourants market is estimated to reach ~USD 38.4 Bn by the end of 2021, a growth of ~5% CAGR during 2016-21, on the back of strong growth in high-value Colourants Industry products. (~USD 4.1 Bn) • From the current market size of ~USD 4.1 Bn (2016), the Indian col
Slide 33: Indian Dyestuff Industry
32 Indian Dyestuff Industry Dyestuff Industry: India – DS Industry size (USD Bn) • Dyestuff (DS) accounts for ~25% (USD 1.03 Bn) of the total colourants industry in India. • It is expected to maintain a higher double digit growth and reach ~USD 2.45 Bn by the 2.45 end of 2021 on the back of: (1) Str
Slide 34: Indian Dyes Intermediates Industry
33 Indian Dyes Intermediates Industry Dyes Intermediates Industry: DI market in India (USD Bn) • In terms of value, DI accounts for 47% (~USD 1.9 Bn) of the total colourant industry in 3.6 India and posted a CAGR of 16.8% from 2009 to 2016. • Over 70% of the DI industry in India is organised due to
Slide 35: Industry Overview
34 Industry Overview Indian Colourant Industry Global Colourant Industry Indian Colourant Industry Share Globally 8.4 38.4 30.1 21.90% 4.1 23.8 13.50% 2 8.40% 2011 2016 2021 2011 2016 2021 2011 2016 2021 RoE and RoCE India's Colourant Domestic-Export Mix India – Reactive DS Reactive DS (production t
Slide 36: India's Competitive Advantage
35 India’s Competitive Advantage China Factors: • In China, apart from the ETP hurdle, there is: (1) Reduction in refund of VAT from 17% to about 13% on DI (2) Cancellation in power subsidy (a major cost, 6-9% of revenue) (3) Non refund of VAT on DS export out of China causing imposition of export d
Slide 37: Strategic Overview
STRATEGIC OVERVIEW
Slide 38: The Way Forward
37 The Way Forward Focus on Focus on Focus on setting up establishing Focus on Free expanding the Set up Inorganic and Focus on manufacturing joint ventures with Cash Flow existing manufacturing organic growth strengthening facility of leading MNCs for Generation and Disperse dyes facilities of thro
Slide 39: Financial Overview
FINANCIAL OVERVIEW
Slide 40: Standalone Income Statement
39 Standalone Income Statement PARTICULARS (INR Mn)** FY15 FY16 FY17* FY18*# FY19* Total Income 7,826 8,967 10,355 9,046 10,647 Total Expenses 7,116 8,064 9,059 7,712 9,055 EBITDA 710 903 1,296 1,334 1,592 EBITDA Margin 9.07% 10.07% 12.52% 14.75% 14.95% Depreciation 202 204 222 250 285 Finance Cost
Slide 41: Standalone Balance sheet (IND-AS)
40 Standalone Balance sheet (IND-AS) PARTICULARS (INR Mn) FY18 FY19 PARTICULARS (INR Mn) FY18 FY19 Equity 5,109 6,307 Non Current Assets 5,554 6,922 Equity Share Capital 302 313 a) Property, Plant and Equipment 3,485 4,290 Other Equity 4,807 5,994 b) Other Intangible assets 1 1 c) Capital Work In Pr
Slide 42: Consolidated Income Statement
41 Consolidated Income Statement PARTICULARS (INR Mn) FY15 FY16 FY17 FY18** FY19 Total Income* 9,328 10,427 12,007 11,368 13,965 Total Expenses 8,313 9,173 10,393 9,542 11,628 EBITDA 1,015 1,254 1,614 1,826 2,337 EBITDA Margin 10.88% 12.03% 13.44% 16.06% 16.73% Depreciation 284 269 291 341 376 Finan
Slide 43: Consolidated Balance sheet (IND-AS)
42 Consolidated Balance sheet (IND-AS) PARTICULARS (INR Mn) FY18 FY19 PARTICULARS (INR Mn) FY18 FY19 Equity 14,047 15,673 Non Current Assets 14,286 15,673 Equity Share Capital 302 313 a) Property, Plant and Equipment 4,033 4,769 Other Equity 13,745 15,360 b) Other Intangible assets 84 70 c) Capital
Slide 44: Consolidated Financial Highlights
43 Consolidated Financial Highlights Total Revenue (INR Mn) EBITDA (INR Mn) & PAT(INR Mn) & PAT Margins 13,965 EBITDA Margins 12,007 11,368 16.73% 1,576 10,427 16.06% 2,337 13.44% 1,267 12.03% 1,095 1,826 1,614 1,254 257 11.15% 11.29% 9.12% 2.46% FY16 FY17 FY18 FY19 FY16 FY17 FY18 FY19 FY16 FY17 FY1
Slide 45: Capital Markets
44 Capital Markets Share Price Data as on 31st March , 2019 60% 40% 20% 0% -20% Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Kiri Sensex Price Data (31st March, 2019) INR Shareholding Pattern as on 31st March, 2019 Face Value 10.00 Market Price 496.30 Public 52
Slide 46: Disclaimer
45 Disclaimer Kiri Industries Limited Disclaimer: The information contained in this presentation is only current as of its date. All actions and statements made herein or otherwise shall be subject to the applicable laws and regulations as amended from time to time. There is no representation that a
Slide 47: Thank You
THANK YOU