Usha Martin Limited · NSE:USHAMART
Usha Martin — Investor Presentation (May 2023)
47 slides from Usha Martin's investor presentation, May 2, 2023
Slide 1: Regulation 30 cover letter to stock exchanges
Date: 2nd May, 2023 The Manager The Secretary Societe de la Bourse de National Stock Exchange of India Ltd BSE Limited Luxembourg Exchange Plaza, 5th Floor, Phiroze Jeejeebhoy Towers, 35A Bouleverd Joseph II Plot No.C/1, G Block, Dalal Street L-1840, Luxembourg Bandra Kurla Complex, Bandra (E) Mumba
Slide 2: Specialty Wire Rope Solutions Provider Investor Presentation May 2023
Specialty Wire Rope Solutions Provider Investor Presentation May 2023
Slide 3: Disclaimer
This presentation and the accompanying slides (the “Presentation”), which have been prepared by Usha Martin Ltd. (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall no
Slide 4: Contents
Company Competitive Overview Edge Financial Growth Overview Strategy Contents ESG Summary Annexure 3
Slide 5: Company Overview
Company Overview 4
Slide 6: Leading global and India's no.1 specialty steel wire rope solutions provider
Leading global and India’s no.1 specialty steel wire rope solutions provider… Rich Legacy Of 6 ~60 years Manufacturing Facilities Offering wide range of: Presence across 30+ ▪ Specialty wire ropes 6 Distribution Centers Continents ▪ High-quality wires ▪ Low relaxation prestressed concrete steel stra
Slide 7: Diversified presence across geographies and end-industries
…With diversified presence across geographies and end- industries ▪ State-of-the-art manufacturing facilities: Ranchi, Hoshiarpur, Dubai, Bangkok, UK and Silvassa ▪ Global Design Center at Italy: Engaged in designing / using proprietary design software to develop best in class products ▪ Worldwide n
Slide 8: We are undergoing a strategic transformation and are poised for growth
We are undergoing a strategic transformation and are poised for growth Turnaround Consolidation Growth • Value accretive capex • Divestment of steel business • Renewed focus on specialty • Enhance specialty offerings resulting in: wire rope business across industry segments • Sharp deleveraging • St
Slide 9: Our vision echoes our long-term growth agenda
Our vision echoes our long-term growth agenda To be the global leader in the wire rope industry by delivering customer delight, adopting modern technology and ensuring sustainable growth for all of its stakeholders 8
Slide 10: Competitive Edge
Competitive Edge
Slide 11: In an industry with high entry barriers
In an industry with high entry barriers… Critical Close Customer High Customer Technical Component Of Engagement Switching Costs Know-how End-product Customer approvals and Customers have little Design application and High-end applications of engagement are built over incentive to switch once knowle
Slide 12: We have the competitive edge to fuel growth
…We have the competitive edge to fuel growth 1 3 5 Brand Value Focus on Services - Robust R&D and Established Over Offering Total Innovation 60 Years Solutions to Clients Capabilities Comprehensive Global ‘Close-to- Strong Financial Product Portfolio Consumer’ Position across Diverse Footprint Criti
Slide 13: Brand value established over 60 years
1 Brand value established over 60 years Manufacturing Excellence Technology Leadership Customer Satisfaction 12
Slide 14: Comprehensive product portfolio across diverse critical applications
2 Comprehensive product portfolio across diverse critical applications Fishing Wire Rope Elevated Structures for Transportation High Capacity Wire Cranes-Ports LRPC Cable Supported Aerial High-Speed Mining Elevator Bridges & Structures Transportation 13
Slide 15: Focus on services - offering total solutions to clients
3 Focus on services - offering total solutions to clients Cutting & Socketing Splicing, Fused & Tapering Testing & Site Inspection Services Spooling and Cutting of Heavy Mechanical Splicing Site Inspection Reels Up to 100 Ton Load Test or Destruction Test Resin Socketing Fused and Tapering with 500
Slide 16: Global close-to-consumer footprint
4 Global ‘close-to-consumer’ footprint EUROPE 6 NORTH AMERICA ASIA Manufacturing Facilities Aberdeen, UK India Rotterdam, Netherlands Singapore Presence Across Nottinghamshire, UK AFRICA Bangkok, Thailand 6 Concesio, Italy Dubai, UAE Ho Chi Minh City, Vietnam Continents Jakarta, Indonesia 30+ Distri
Slide 17: Robust R&D capabilities
5 Robust R&D capabilities ▪ GDC has >40 years experience in rope design and application engineering ▪ Technical guidance for product development ▪ In-depth R&D and product testing ▪ Project management and quality assurance for critical supplies ▪ Close co-operation with customers, universities and r
Slide 18: Financial Overview
Financial Overview
Slide 19: Strategic initiatives have strengthened operational and financial performance
Strategic initiatives have strengthened our consolidated operational and financial performance Delivery Volumes (‘000 MT) Revenue (in Rs. crore) 193 192 3,268 189 2,688 2,153 2,097 ▪ Registered consistent performance by 174 leveraging inherent strengths ▪ Greater focus on high value offerings to con
Slide 20: Key Operational Highlights
Key Operational Highlights Sales Volumes1 (‘000 MT) ▪ Increase in rope volumes and marginal decrease in 193 192 wire and LRPC volumes in line with the Company’s 189 strategy to focus on value added products and reduce share of low-value offerings 174 ▪ Segment wise contribution to overall volumes FY
Slide 21: Segmental Revenue Overview
Segmental Revenue Overview In Rs. crore Wire Rope Wire & Strand 2,194 363 1,640 339 327 1,350 1,289 307 FY20 FY21 FY22 FY23 FY20 FY21 FY22 FY23 LRPC ▪ Wire rope segments contribution to overall revenues 502 increased to 67% in FY23 vs. 61% in FY22 494 ▪ Within Wire rope, the value-added segments (cr
Slide 22: Continuing shift towards value accretive products, applications and geographies
Continuing shift towards value accretive products, applications and geographies Consolidated Revenue Break-up1 Product Segmentation End Industry Segmentation1,2 Geography Segmentation1,3 Others, 8% Asia Pacific, 16% Fishing, 2% Others, 3% Mining, 4% Middle East Wire & Strand, 10% Utilities, 4% Engin
Slide 23: We have been successfully navigating raw material volatility
We have been successfully navigating raw material volatility Steel Price1 (Rs. per tonne) 65,530 63,590 59,302 61,691 56,317 58,040 44,112 ▪ Sustained EBITDA/ton on a quarterly basis FY21 FY22 Q1FY23 Q2FY23 Q3FY23 Q4FY23 FY23 ▪ Robust pass-on mechanism in place to consistently manage raw-material pr
Slide 24: Healthy balance sheet to support growth initiatives
Healthy balance sheet to support growth initiatives Networth (in Rs. crore) Net Debt (in Rs. crore) Net Working Capital Days 3,463 Payable Receivable Inventory 2,035 1,697 156 167 169 177 1,407 121 1,265 814 189 201 180 170 144 458 342 40 44 45 42 44 191 185 63 53 38 77 79 FY19 FY20 FY21 FY22 FY23 F
Slide 25: Enhancing Creditworthiness: Improving Credit Ratings
Enhancing Creditworthiness: Improving Credit Ratings A+ A A- BBB+ BBB Current Rating A Outlook Positive BBB- Last Review Aug’22 BB+ BB BB- FY'18 FY'19 FY'20 FY'21 FY'22 Aug'22 Long term issuer rating at ‘IND A’ / Outlook : Positive Short term issuer rating at ‘IND A1’ 24
Slide 26: Robust Cash Flows
Robust Cash Flows In Rs. crore Operating Cash Flow before Income Tax 345 241 217 146 ▪ Healthy OCF generation supports Company’s capital allocation plans FY20 FY21 FY22 FY23 ▪ The OCF to EBITDA2 in FY23 recorded a healthy improvement, standing at 67% compared to Free Cash Flow 38% in FY22 174 177 ▪
Slide 27: Focus on enhancing shareholder value
Focus on enhancing shareholder value FY23 Rs. 76.18 crore 22% of Profit After Tax Dividend (proposed dividend) FY22 Rs. 60.95 crore 21% of Profit After Tax Dividend Paid Dividend Payout Policy ▪ New dividend policy adopted during FY22 (Link) ▪ Aspires to maintain healthy dividend payout 26
Slide 28: Growth Strategy
Growth Strategy
Slide 29: Multi-faceted growth strategy continue to drive our performance
Multi-faceted growth strategy continue to drive our performance Capex initiatives focused on value-migration ▪ Capex wave1 of Rs. 310 crore at Ranchi on schedule and expected to be completed by Q3FY24 ▪ Capex wave2 of Rs. 167 crore to commence during FY24 at Ranchi ▪ Capex program of Rs. 62 crore to
Slide 30: Capex initiatives focused on value-migration
Capex initiatives focused on value-migration Consolidated Capex Spend ▪ Capex wave1 of Rs. 310 crore during FY22 at Ranchi – expected to be completed by Q3FY24 – would result in 349 capacity enhancement by ~47,000 mt/annum 92 ▪ Capex wave2 of Rs. 167 crore proposed during FY24 at Ranchi – expected t
Slide 31: Expand international market share through overseas subsidiaries
Expand international market share through overseas subsidiaries In Rs. crore ▪ International operations have recorded a substantial growth in revenue with FY23 at 34% higher than FY22 ▪ Macro-economic factors that continue to strengthen our performance Revenue from International Operations1 o Growth
Slide 32: Strong focus on digital initiatives
Strong focus on digital initiatives Wave 1: Wave 2: Wave 3: Upto Dec. 2023 Upto Dec. 2024 Upto Dec. 2025 Single version of truth Connected Organisation Automation coverage, Reimagined reductions of manual Usha Data Driven Decision Making Martin Business Benefits activity SAP Analytics Phase 3 Transp
Slide 33: Remain financially prudent
Remain financially prudent Operating Consolidated Net Debt Net Working EBITDA Revenue leverage Capital Days margin Outlook (2-3 years) ~15% ~18% <1 <150 (CAGR growth) Net Debt/EBITDA Days (Baseline FY22) Operating Consolidated Net Debt Net Working EBITDA Revenue leverage Capital Days margin FY23 22%
Slide 34: ESG
ESG 33
Slide 35: Focus on sustainability
Focus on sustainability Energy And Sustainable Carbon Intensity Supply Chain ▪ Child labor due-diligence ▪ Reduce GHG emissions ▪ Strict adherence to supplier Community ▪ Supply products to code of conduct and supplier renewable energy sector Engagement sustainability ▪ Investment in skill ▪ Prefere
Slide 36: Governance structure in place to drive transparency, accountability and sustainability
Governance structure in place to drive transparency, accountability and sustainability Board of Directors 4 Independent Directors, 3 Whole Time Directors and 1 Non-Executive Director Audit Committee Stakeholders Relationship Risk Management Committee Committee Nomination & Remuneration Finance Commi
Slide 37: Corporate social responsibility (CSR) initiatives
Corporate social responsibility (CSR) initiatives Natural Resource Health, Nutrition & Women Management Sanitation Empowerment ▪ Well construction ▪ Village hospitals ▪ Strengthening of self- help group ▪ Drip irrigation ▪ Health camps ▪ Training of capacity ▪ Hand pump repair ▪ Health awareness bui
Slide 38: Summary
Summary
Slide 39: Focused on creating sustainable value for all stakeholders
Focused on creating sustainable value for all stakeholders State-of-the-art manufacturing, R&D capabilities and well entrenched global distribution network – ‘close-to- customer’ strategy enables the Multi dimensional business company to provide customized initiatives to support shift towards soluti
Slide 40: Annexure
SORT BRT ie Rs SANT
Slide 41: Marquee projects
Marquee projects Sardar Vallabhbhai Patel Statue, World’s longest hanging bridge for ZPMC, China, Barge Disneyland, Shanghai, China Gujarat - Pavilion roof structure adventure tourism in Italy - Cables Crane - Main & auxiliary - Full locked coil, supporting supporting cables with special end connect
Slide 42: Manufacturing set-up - India
Manufacturing set-up - India Ranchi Facility Ismal Unit, Ranchi Hoshiarpur Plant Spread across an area of more than 100 acres, this facility is one of the world’s largest wire Well-equipped facility with over 3 decades of Set up in 1974 in Punjab, India, spread over 8 rope manufacturing facility exp
Slide 43: Manufacturing set-up - International
Manufacturing set-up - International Brunton Wire Ropes FZCO Brunton Shaw UK Ltd. Usha Siam Steel Industries Located at Nottinghamshire in UK, manufacturers high quality wire ropes for a wide range of applications UK Located at Jebel Ali Free Zone in THAILAND Manufacturing facility Dubai (UAE), this
Slide 44: Globally recognized certifications and licenses
Globally recognized certifications and licenses ISO 45001: 2018 ISO 14001: 2015 Certificate of Authority issued by ISO 9001: 2015 Occupational Health & Safety Environmental management American petroleum Quality management systems institute Systems Approved Manufacturer of Manufacturer Certificate Ma
Slide 45: Market snapshot
Market snapshot Shareholding pattern as on 31st March 2023 As on Key Market Statistics st 31 March 2023 517146 / Public 29.4% BSE/NSE Ticker USHAMART CMP (Rs.) 214.5 Market Cap (Rs. Crore) 6,537 Corporate Bodies 13.7% Number of outstanding shares (Crore) 30.47 Face Value 1.00 FPI 9.4% 52-week High /
Slide 46: Contact us
Contact us About Us: Established in the year 1960, Usha Martin is a leading global and India’s No. 1 specialty steel wire rope solutions provider. The Company is also engaged in Mr. Anirban Sanyal (Chief Financial Officer) / the manufacturing of high-quality wires, low relaxation prestressed concret
Slide 47: Thank You
Thank You tf usha martin