Slide 1: Cover letter to stock exchanges: Strategy Presentation
2nd November 2023 The Listing Department, The Manager The Manager, The Calcutta Stock The Department of The Listing Department, Exchange Ltd. Corporate Services, National Stock Exchange of 7, Lyons Range, BSE Limited, India Limited, Kolkata – 700001 P. J. Towers, Exchange Plaza, Dalal Street, Bandra
Slide 2: H1 FY24 Strategy Presentation
H1 FY 24 STRATEGY November 2023 PRESENTATION. NSE : LINC BSE : LINC Linc Limited Bloomberg : LINC:IN (formerly Linc Pen and Plastics Limited) 1
Slide 3: Safe Harbour Statement
Safe Harbour Statement. This presentation may contain certain “forward-looking statements” within the meaning of applicable securities laws and regulations, which may include those describing the Company’s strategies, strategic direction, objectives, future projects and/or prospects, estimates etc.
Slide 4: Inside this Presentation
Inside this Presentation. Executive Summary Industry Outlook LINC 2.0 Financial Snapshot 3
Slide 5: LINC Who are we?
L NC lincpen.com LINC Who are we?.
Slide 6: A Leading Writing Instrument Company
A Leading Writing Instrument Company. ▪ Among Top 3 brands ▪ New Writing Instrument ▪ Global brand from ▪ Asia’s largest stationery in India for Writing brand launched in FY19 by Mitsubishi Pencil Co. Ltd, giant. • Linc Ltd. is one of India’s Instruments. Linc in MRP ₹10 and above Japan. largest wri
Slide 7: With State-of-the-Art Manufacturing Facilities
With State-of-the-Art Manufacturing Facilities. ▪ Manufacturing Facility at Serakole in West ▪ Manufacturing Facility at Umbergaon, Gujarat Bengal with plans in place to double the capacity ▪ Plant at Serakole was established in 1984 ▪ Plant at Umbergaon was established in 2017 Umbergaon Manufacturi
Slide 8: Trend of Financial Performance
Trend of Financial Performance. 8000 15.0 CAGR 7.0% Growth 8.1% CAGR 15.7% Growth 16.7% 40.0% CAGR 17.1% Growth 9.2% 12.6% 31.2% 6000 ₹ LACS 30.0% 9.6% 6,136 10.0 48,676 24.7% 15,197 30.6% 10.6% 28.3% 10.5% 39,699 23.8% 4000 20.0% 4.0% 35,496 22.4% 3,826 6.1% 9,805 5.00 25,666 8,441 22,492 24,309 6,
Slide 9: Leadership
Leadership. MR. DEEPAK JALAN MR. ANIL KOCHAR Managing director, Independent, Non-executive director, ▪ Commerce graduate with 37 years of experience ▪ Postgraduate in Commerce and LLB ▪ Responsible for the overall operations with a specialization in ▪ An eminent advisor on income tax matters interna
Slide 10: Industry Outlook
L NC lincpen.com Industry Outlook.
Slide 11: Global Stationery Industry Opportunity
Global Stationery Industry Opportunity. Global Stationery Products Market Growth Drivers 217.9 ▪ Rising inclination towards higher education ▪ Demand from corporate sector 192.2 ▪ Increase in customized and personalized stationery ▪ Increased literacy rate in the developing world US$ Billion CAGR 1.
Slide 12: Global Writing Instrument Industry Opportunity
Global Writing Instrument Industry Opportunity. Global Writing Instruments Market Share of Relevant Market 32.9 Writing & Marking Instruments Market Size 2020 2027 ▪ The USA is estimated at US$4.7 Billion in the 22.5 Ball & Gel Pen 36% 41% year 2022. US$ Billion CAGR 3.9% ▪ China is forecasted to re
Slide 13: Opportunity in Indian Market
Opportunity in Indian Market. Indian Writing & Creative Indian Education Industry Writing Instruments Market Growth Drivers Instruments Market 225 140 - 145 ▪ Rising Populations: o Largest population in age bracket of 5-24 years ~580 million. ₹ Billion US$ Billion 96.8 o Indian working population to
Slide 14: Indian Writing Instrument Industry Opportunity
Indian Writing Instrument Industry Opportunity. Indian Writing Instruments Market Indian Pen Segment at Manufacturer’s Realization, in ₹ Billion • Demand is driven by students and working-class population 91.5 - 96 • As of FY23 Pens occupy 65% share in Writing Instruments, and CAGR expected to incre
Slide 15: Indian Writing Instrument Industry Opportunity
Indian Writing Instrument Industry Opportunity. Indian Pen Market subsegments Indian Pen Segment Market Size in ₹ Billion 87 - 90 15-20% CAGR 7.6% – 8.3% 25 15-20% 42% 60.4 Premium 58% FY23E MRP 17.3 Mid-Premium 42.5 Mass 70-75% 12.1 26.9 62 - 65 7.7 43.1 Pen Subsegments Price Criteria 30.4 19.2 Mas
Slide 16: Pens - Global Trade Perspective
Pens - Global Trade Perspective. 2,367 Top 10 Exporters of Pens in CY 2022 Top 10 Importers of Pens in CY 2022 USD Millions USD Millions 1,175 951 787 434 431 390 375 340 290 339 238 242 165 161 160 156 156 154 136 China Japan Germany Mexico France USA Germany France Mexico China United Kingdom Neth
Slide 17: LINC 2.0
L NC LINC 2.0. lincpen.com 16
Slide 18: Evolution to Linc 2.0
Evolution to Linc 2.0. Full Effect of Pentonic Project Full Effect of Gel Pen Project Share of Pentonic Revenue Total Revenue reached ₹ 13,684 lacs increased to 17%, GM and EBITDA was ₹ 918 lacs expanded to ~ 25% due to higher GP of 46% on Pentonic 1999- 2004- 2018- 2019- 2022 2000 2005 2019 2020 On
Slide 19: Increased Touch Points…
Increased Touch Points… Break-up of Region wise Touch Points – Sep’ 2023 2,41,424 2,48,573 2,18,471 1,48,898 1,41,970 1,44,969 1,16,963 65,000 56,553 South India 50,000 East India 21% 24% 3,000 5,000 FY 19 FY 20 FY 21 FY 22 FY23 Sep-23 Total touch points Kiranas, Medical Stores, Pan Stores etc. ▪ In
Slide 20: …Resulting in Broader Penetration Across India
…Resulting in Broader Penetration Across India. Revenue Share FY19 Revenue Share H1 FY 24 13.0% 17.0% East India 31.0% 14.0% 42.0% North India 21.0% West India 31.0% South India 31.0% Increasing footprint in West and South India and steadily moving towards a more homogenous presence across India 19
Slide 21: Increasing its Global Footprint As Well
Increasing it’s Global Footprint As Well. Value Growth Linc’s Geographic Reach – H1 FY 24. Pen Exports from India - 2022 USD Millions over 2021 South & Central America (SA) 30 66% Europe Including Russia North America 16.8% Middle East (ME) 41 80% 2.4% Africa 43 38% South East Asia (SEA) 23 49% Tota
Slide 22: Focus on Premiumisation
Focus on Premiumisation. ▪ Pentonic brand introduced in FY19 as a 32.7% 31.2% 29.9% 30.6% minimalistic yet contemporary pen, known for its 25.5% aesthetics as well as writing smoothness 20.0% 17.2% ▪ Positioned at ₹ 10 + segment, Pentonic’s GPM is ~ 24.7% 23.8% 41% 7.0% 21.8% 22.4% ▪ Increase in sha
Slide 23: Typical Price Waterfall
Typical Price Waterfall. Particulars Pentonic Others Ball Pen MRP ₹ 10.00 ₹ 10.00 Retailer Margin ₹ 2.50 ₹ 3.25 Distributor Margin ₹ 0.48 ₹ 0.47 Super Stockist / Channel Partner Margin ₹ 0.28 ₹ 0.25 GST (For entire value chain) ₹ 1.14 ₹ 1.03 Company’s Realisation ₹ 5.60 ₹ 5.00 22
Slide 24: Inroads into Stationery Products
Inroads into Stationery Products. ▪ Targeting over ₹7,500 lacs topline by FY25 ▪ Deli offers a range of over 200 products in India ▪ Company to largely focus on Calculators & Scissors ▪ Deli should contribute at least 10 % of company’s revenue by FY25 ▪ Deli’s GPM is around 20% ▪ Deli has achieved t
Slide 25: ESG
ESG. Environment Social Governance ▪ Pentonic’s individual ▪ Strongly believes in ▪ Consistently endeavored plastic wrapper packaging diversity in the workforce to practice good has been consciously and has ~700 female Corporate Governance substituted with paper employees at Gujarat ▪ Believes such
Slide 26: Step-up the Existing Capacity
Step-up the Existing Capacity. Linc plans to increase its existing capacity at Gujarat from 10 lacs pen per day to 15 lacs pen per day in FY’25 & to 20 lacs pen per day subsequently FY’24 demand would be met by the existing capacity & stepping-up outsourcing, which has already been tied up Revenue p
Slide 27: LINC Financial Snapshot
L NC lincpen.com LINC Financial Snapshot. 26
Slide 28: Half Year Highlights (Cont..)
Half Year Highlights (Cont..). ₹ Lacs Writing Instruments Other Products Writing Instruments Other Products Revenue Own Brands Licensed Brands Own Brands Licensed Brands Pentonic Linc & Others Uni-Ball Pentonic Linc & Others Deli H1 FY24 7,598 9,783 3,854 364 1.138 1,619 Sales Contribution (%)
Slide 29: Half Year Highlights (Cont..)
Half Year Highlights (Cont..). Trade Channel Wise Break-up of Operating Revenue ₹ Lacs Writing Instruments Other Products 3,808 Exports 16% 4,142 Exports 19% 793 E commerce 3% 374 E commerce 2% 1,442 Modern Trade 1,196 6% Modern Trade 6% 1,074 Corporate 740 4% Corporate 3% 17,239 General Trade 14,89
Slide 30: Profit & Loss Summary
Profit & Loss Summary. ₹ Lacs Particulars FY19 FY20 FY21 FY22 FY23 H1 FY24 Operating Income 36,694 39,699 25,666 35,496 48,676 24,309 Gross Profit 7,434 9,805 5,753 8,441 15,197 7,427 Gross Profit Margin 20.3% 24.7% 22.4% 23.8% 31.2% 30.6% Operating EBITDA 2,539 3,826 1,017 2,153 6,136 2,574 Oper
Slide 31: Balance Sheet Summary
Balance Sheet Summary. ₹ Lacs Particulars FY19 FY20 FY21 FY22 FY23 H1 FY24 Net Worth 12,337 13,697 13,471 14,285 17,722 18,470 Gross Debt 6,205 4,575 812 299 - - Cash & Cash equivalent 11 13 14 9 760 597 Net Debt 6,194 4,562 797 290 (760) (597) Capital Employed1 19,388 19,199 15,025 15,178 18,7
Slide 32: Ratios
Ratios. ₹ Lacs Particulars Ratios FY19 FY20 FY21 FY 22 FY23 H1 FY24 Net Debt/Equity 0.50 0.33 0.06 0.02 (0.04) (0.03) Solvency Ratios Net Debt/Op EBITDA 2.44 1.19 0.78 0.13 (0.12) (0.12) EBIT/Interest 2.76 5.26 -0.39 15.81 79.78 18.24 Current Ratio 1.68 1.85 1.92 2.14 2.56 2.65 Fixed Asset Turn
Slide 33: Focus on Shareholder Value Creation
Focus on Shareholder Value Creation. Net Cash from Operating Activities Vs Dividend Payout 5,000 60.0% 52% 4,723 4,000 50.0% 4,338 • NCOA continues to be strong in H1 FY 24 3,835 40.0% ₹ LACS 3,000 3,317 • Consistent Dividend Pay-out track record (Other than Covid years 33% 30.0% 2,000 20% 2,364 12%
Slide 34: Shareholding Pattern
Shareholding Pattern. 24.8% Promoters 2.2% Mitshubishi Pencil Co Ltd 0.2% 59.3% IEPF 13.5% NRI, FII, AIF etc. Other Public As on 30th September’23 33
Slide 35: Why Linc?
Why Linc?. Education sector Strong Balance Sheet with experiencing strong tail zero debt and free cash in winds in India; hence hand; strong top & bottom demand for company’s line growth products will continue to grow Presence over all categories Strong in-house – Roller Pen, Gel Pen & Ball manufact
Slide 36: Thank You
Thank You. For further details please contact Director Finance & CFO Investor Relations Advisor N.K.Dujari Email: investors@linclimited.com Phone No.: +91 9830042353 Sanjeev Sancheti Landline: +91 33 68262100 Email: ss@uirtus.in Phone No.: +91 9836244222 35