Godawari Power & Ispat Ltd. · NSE:GPIL
Godawari Power & Ispat — Q1 FY2021 Earnings Presentation
38 slides from Godawari Power & Ispat's earnings presentation, Aug 11, 2020
Slide 1: Exchange filing cover letter
---1-11 RA-- GODAWARI POWER & ISPAT REF: GPILINSE & BSE/2020/4158 Date: 11.08.2020 To, 1. The Listing Department, 2. The Corporate Relation Department, The National Stock Exchange of India Ltd, The BSE Limited, Exchange Plaza, Bandra Kurla Complex, First Floor, Rotunda Building, Bandra (E), Mumbai -
Slide 2: Q1FY21 Earnings Presentation
Godawari Power & Ispat Limited Q1FY21 Earnings Presentation August 2020 1
Slide 3: Disclaimer
Disclaimer This presentation and the accompanying slides (the “Presentation”), which have been prepared by Godawari Power and Ispat Limited (the “Company”) solely for the information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, a
Slide 4: Q1FY21: Resilient Performance despite Covid Led Disruptions
Q1FY21: Resilient Performance despite Covid Led Disruptions Consolidated Operational Highlights Production and Sales Volumes impacted due to Covid-19: 22-30% reduction across product categories except pellets, which increased QoQ and YoY Lower domestic demand mitigated by higher export sales; 95
Slide 5: Financial & Operational Impact of COVID-19
Financial & Operational Impact of COVID-19 Operational Impact • Manufacturing operations were temporarily shut in steel business from 24th March to 9th April steps were taken to restart the operations • Plants reached to near normal capacity by 3rd week of May 2020 • Solar business continued to oper
Slide 6: Clear Strategic Priorities
Clear Strategic Priorities Leverage Portfolio Flexibility to maximise profits • Frequent adjustments to product mix, depending on demand environment, to maximise sales & margins • Focus on increasing high grade (67%+ Fe) pellet production; to be utilized for exports & for captive consumption in maki
Slide 7: Incremental Cash Flows Utilised for De-Leveraging
Incremental Cash Flows Utilised for De-Leveraging All figures in INR MN Paid c2x times over Repaid c2x times over Repaid entire scheduled the scheduled the scheduled debt repayment of FY21 Debt Repayment Schedule repayment in FY19 repayment in FY20 GPIL (Standalone) ASL GGE 2,430 2,130 1,303 330 65
Slide 8: Q1FY21 Production Summary
Q1FY21 Production Summary Production (in MT) Q1FY21 Q4FY20 QoQ (%) Q1FY20 YoY (%) FY20 FY19 YoY (%) Iron ore Mining 3,21,807 4,51,875 -29% 4,48,914 -28% 16,57,629 15,47,384 7% Iron ore Pellets - GPIL 4,64,150 4,41,000 5% 4,76,700 -3% 19,99,150 19,33,250 3% Iron Ore Pellets - ASL 1,85,149 1,70,446 9%
Slide 9: Q1FY21 Sales Volume Summary
Q1FY21 Sales Volume Summary Sales Volume (in MT) Q1FY21 Q4FY20 QoQ (%) Q1FY20 YoY (%) FY20 FY19 YoY (%) Pellet - GPIL - Domestic 18,751 1,27,863 -85% 1,86,132 -90% 6,39,219 10,91,133 -41% Pellet - GPIL - Export 3,61,550 1,61,326 124% 1,39,691 159% 7,23,077 3,61,416 100% Pellet - ASL 1,80,166 2,04,25
Slide 10: Q1FY21 Realisation Summary
Q1FY21 Realisation Summary Realisation Q1FY21 Q4FY20 QoQ (%) Q1FY20 YoY (%) FY20 FY19 YoY (%) Iron Ore Pellet - GPIL* 6,124 6,402 -4% 6,353 -4% 6,259 6,568 -5% Iron Ore Pellet - ASL 5,643 5,646 0% 5,621 0% 5,600 6,051 -7% Sponge Iron 15,100 19,165 -21% 17,898 -16% 16,897 19,736 -14% Steel Billets 27
Slide 11: GPIL Consolidated - Profit & Loss
GPIL Consolidated - Profit & Loss Particulars (in Mn) Q1FY21 Q4FY20 QoQ (%) Q1FY20 YoY (%) FY20 FY19 YoY (%) Net Sales 7,113 7,873 -10% 8,342 -15% 32,885 33,216 -1% Total Expenses 5,535 6,345 -13% 6,593 -16% 26,643 25,323 5% Other Income 11 5 132% 13 -16% 47 59 -21% EBITDA 1,588 1,533 4% 1,762 -10%
Slide 12: GPIL Standalone - Profit & Loss
GPIL Standalone - Profit & Loss Particulars (in Mn) Q1FY21 Q4FY20 QoQ (%) Q1FY20 YoY (%) FY20 FY19 YoY (%) Net Sales 5,740 6,467 -11% 7,279 -21% 27,740 28,753 -4% Total Expenses 4,776 5,414 -12% 6,006 -20% 23,340 22,556 3% Other Income 9 3 176% 11 -19% 29 30 -3% EBITDA 972 1,056 -8% 1,283 -24% 4,429
Slide 13: Ardent Steel Limited Standalone - Profit & Loss
Ardent Steel Limited Standalone - Profit & Loss Particulars (in Mn) Q1FY21 Q4FY20 QoQ (%) Q1FY20 YoY (%) FY20 FY19 YoY (%) Net Sales 1,020 1,157 -12% 734 39% 4,171 3,540 18% Total Expenses 721 902 -20% 558 29% 3,165 2,628 20% Other Income 0 6 -98% 0 0% 7 3 119% EBITDA 300 261 15% 176 71% 1,013 915 1
Slide 14: Godawari Green Energy Limited - Profit & Loss
Godawari Green Energy Limited - Profit & Loss Particulars (in Mn) Q1FY21 Q4FY20 QoQ (%) Q1FY20 YoY (%) FY20 FY19 YoY (%) Net Sales 367 256 43% 341 8% 1,003 928 8% Total Expenses 52 40 30% 39 34% 163 143 14% EBITDA 315 216 46% 302 4% 840 786 7% EBITDA Margin (%) 86% 84% 89% 84% 85% Other Income 2 - -
Slide 15: International & Domestic Tailwinds
International & Domestic Tailwinds International Market o Iron ore prices have climbed from a low of US$ 80/t seen in April’20 to US$ 120/t, almost touching two year high. Iron ore prices remained well supported despite global players returning to production and maintaining their guidance. Demand fr
Slide 16: Godawari Power & Ispat Limited
Godawari Power & Ispat Limited INVESTOR PRESENTATION
Slide 17: Integrated Asset Portfolio; Unique Presence Across Steel Value Chain
Integrated Asset Portfolio; Unique Presence Across Steel Value Chain Asset Capacity FY20 Utilisation (%) Asset Capacity FY20 Utilisation (%) Iron Ore MS 0.4 mt Mining 2.1mt 76% Rounds 85% 46% 64% Iron Ore 92% HB 0.15 mt 90% 2.8 mt 96% Pellets Wires 87% Sponge 93% Ferro 16,500 mt 0.5 mt 99% Alloys Ir
Slide 18: GPIL – Focused on Generating Shareholder Value
GPIL – Focused on Generating Shareholder Value Balance Sheet De- Clear Strategy Portfolio Optimisation Improving Financials Leveraging Increasing value addition Net Debt to equity Reduced to Focus on Integrated Steel FY20 Revenue Flat YoY by enhancing captive 1.1x from 3x in 2017; Target Value Chain
Slide 19: FY20 Return & Liquidity Ratios
FY20 Return & Liquidity Ratios Unit Standalone Ardent GGEL Consolidated RoE % 11% 32% 0% 12% RoCE % 15% 33% 7% 15% BVPS INR 340 - - 426 Net Debt to EBITDA x 2.68 0.75 5.51 2.65 Net Debt to Equity x 0.99 0.40 1.67 1.11 Interest Coverage x 2.88 7.51 1.64 2.97 18
Slide 20: Increased Captive Consumption Provides Significant Margin Expansion
Increased Captive Consumption Provides Significant Margin Expansion Significant captive mining capacity aid in lowering costs & improving margins Iron Ore Production (MT) Captive Mining • Increased captive mining to aid in lowering cost and Started improving margins. operations at Boria Tibu Power M
Slide 21: Captive Mining Leading To Huge Raw Material Costs Saving
Captive Mining Leading To Huge Raw Material Costs Saving 4,346 4,400 4,270 3,500 3,200 3,000 2,750 2,600 2,462 2,310 2,250 2,181 2,050 1,800 FY15 FY16 FY17 FY18 FY19 FY20 Q1FY21 Market Price of Iron Ore Captive Ore Landed Cost 20
Slide 22: Focussed on Value Creation: Net Debt Reducing & FCF increasing
Focussed on Value Creation: Net Debt Reducing & FCF increasing All figures in INR MN Net Debt to Equity 2.5x 1.9x 1.4x 1.1x 1,909 1,731 21,634 20,715 1,051 18,467 16,678 -3,162 FY17 FY18 FY19 FY20 Net Debt FcF* *FcF = Free Cashflow from operation – capex - interest cost 21
Slide 23: Balance Sheet Stronger compared to Large Cap Steel Companies
Balance Sheet Stronger compared to Large Cap Steel Companies Net Debt to Equity (x) Net Debt to EBITDA (x) 1.5x 1.5x 6.8x 1.3x 1.1x 1.1x 5.2x 4.6x 4.5x 2.7x Peer1 Peer2 Peer3 Peer4 GPIL Peer1 Peer2 Peer3 Peer4 GPIL * Peers- Large cap steel companies 22
Slide 24: Improving Liquidity Ratios
Improving Liquidity Ratios 5,508 5,498 5,508 4,511 3,771 Cash Flows from 3,140 2,581 Operation 1,699 1,657 Capex 1,063 827 556 716 146 Free Cash Flows FY14 FY15 FY16 FY17 FY18 FY19 FY20 Net Debt to EBITDA Net Debt to Equity 2.75 9.87 2.54 8.09 8.14 2.132.05 1.911.94 7.07 1.381.27 1.11 3.423.11 0.91
Slide 25: Group Structure
Group Structure Associates JVs Godawari Power and Ispat Ltd. 48.45% 33.30% Hira Ferro Alloys Raipur Ltd. Infrastructure Co 76.12% 76.34% Godawari Green 25.93% Ardent Steel Ltd. Energy Ltd. Chattisgarh Captive Coal Mining 51.30% 33.96% 35.36% Godawari Energy Ltd. Chhattisgarh Ispat Jagdamba Power & A
Slide 26: Large Portfolio of Long-life Assets
Large Portfolio of Long-life Assets Pelletisation Plant Odisha Solar Thermal Power Plant Keonjhar: 0.69 mn MTPA Rajasthan: 50MW Siltara Integrated Plant Chhattisgarh 1 mn MTPA Iron ore beneficiation 2.1 mn MTPA Iron ore pellets 0.5 mn MTPA Sponge iron 0.4 mn MTPA Steel billets 0.1 mn MTPA HB wire 73
Slide 27: Shareholding Pattern as on June 2020
Shareholding Pattern as on June 2020 Shareholding Pattern Break up of Shareholding Pattern Shareholding % of Total Sh. Institution 0.54% 32.58% Non Institution 31.96% Total 32.50% 67.42% Promoter Shareholding % of Total Sh. Pledge* 32.51% Total 67.50% Promoter Public * Pledged with lenders as an add
Slide 28: Board of Directors
Board of Directors Mr Biswajit Choudhary (Chairman & Mr BL Agarwal Independent Director) Managing Director 5 decades of experience in • 1st generation entrepreneur with Engineering, Banking & Finance; almost 4 decades of experience; Mechanical Engineering from IIT, Graduated as an electronic; Kharag
Slide 29: Board of Directors
Board of Directors Mr. Dinesh Gandhi Mr. Shashi Kumar (Independent (Non-Executive Director) Director) 4+ decades of experience; B.Sc. In 3 decades of experience in Mining Engineering; Advisor to Accounts, Finance & Project NTPC, IFFCO & Chhattisgarh Power Financing; Chartered Accountant ltd Mr. B N
Slide 30: Subsidiary | Godawari Green Energy
Subsidiary | Godawari Green Energy Operating Performance o Facility located in village Naukh, Jaisalmer, 103 23% 97 22% 19% 91 85 21% Rajasthan 91 86 75 81 o GGEL has been set up to implement project awarded under Jawaharlal Nehru National Solar Mission, Phase I of Govt. of India o The first plant t
Slide 31: Subsidiary | Ardent Steel
Subsidiary | Ardent Steel Operating Metrics 6,053 o The company has a total production capacity of 0.69 mn 5,600 4,932 5,050 100% MTPA pellet which located in Phuljhar, Keonjhar, Odisha 97% 95% o The plant uses iron ore from the merchant mines in Barbil, located in the Keonjhar district 50% o The de
Slide 32: GPIL Standalone – Past Operational Performance at a Glance
GPIL Standalone – Past Operational Performance at a Glance... Trend of Iron Ore Mining (mt) Trend of Pellets Production (mt) 16,57,629 15,79,693 15,47,384 19,33,250 19,99,150 18,41,050 11,75,090 15,32,200 15,80,850 14,95,100 6,57,328 9,02,550 4,44,695 3,26,358 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 FY2
Slide 33: GPIL Standalone – Past Operational Performance at a Glance
GPIL Standalone – Past Operational Performance at a Glance... Trend of Steel Production (mt) Silico Manganese (mt) 3,44,610 2,98,418 13,700 13,772 13,136 11,116 11,403 10,537 10,517 2,27,581 2,04,162 1,97,596 1,88,190 1,77,970 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 FY20 FY 14 FY 15 FY 16 FY 17 FY 18 FY
Slide 34: Past Sales Realisations
Past Sales Realisations Iron ore Pellet Sponge Iron 19,736 7,872 18,934 7,798 18,277 7,091 16,678 16,897 6,809 5,365 13,310 5,067 12,383 4,360 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 Steel Billets 33,072 29,493 28,681 28,590 27,720 22,689 21,830 FY 14 FY 15 FY
Slide 35: Past Sales Realisations
Past Sales Realisations M.S. Round H.B. Wire 38,740 40,666 33,265 33,409 33,327 32,460 36,169 34,683 35,182 34,015 27,034 26,330 28,080 28,063 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 Silico Manganese 67,611 64,632 63,898 53,365 52,696 51,665 43,139 FY 14 FY 15
Slide 36: GPIL Consolidated – Historical Profit & Loss
GPIL Consolidated – Historical Profit & Loss Particulars (in Million) FY20 FY19 FY18 FY17 Net Sales 32,885 33,216 25,274 19,941 Total Expenses 26,643 25,323 19,305 17,033 Other Income 47 58 87 153 EBITDA 6,289 7,952 6,056 3,061 EBITDA Margin (%) 19% 24% 23% 15% Depreciation 1,369 1,329 1,318 1,201 F
Slide 37: GPIL Consolidated – Historical Balance Sheet
GPIL Consolidated – Historical Balance Sheet Particulars (INR mn) FY20 FY19 FY18 FY17 Net Worth 15,026 13,364 10,837 8,503 Non‐Controlling Interest 1,773 1,672 1,604 1,533 Debt Long Term Debt 14,645 16,431 18,730 19,799 Short Term Debt 1,604 1,393 1,344 1,955 Other Long Term Liabilities 605 127 103
Slide 38: Thank you
Thank you Investor Relations Contact: Company Contact: Ankit Toshniwal Govind Jaju Go India Advisors Godawari Power and Ispat Ltd. ankit@GoIndiaAdvisors.com govind.jaju@hiragroup.com M:+91 90224 80789 M:+91 98922 53901 37
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