Ester Industries Limited · NSE:ESTER
Ester Industries — Q3 FY22 Earnings Presentation
41 slides from Ester Industries's earnings presentation, Feb 7, 2022
Slide 1: Cover letter to BSE and NSE
Date: 7th February, 2022 BSE Limited National Stock Exchange of India Limited Department of Corporate services Exchange Plaza, Phirojee Jeejeebhoy Towers Plot no. C/1, G Block, Dalal Street, Mumbai – 400023 Bandra‐Kurla Complex, Bandra (E), Mumbai – 400051 Scrip Code: 500136 Symbol: ESTER Dear Sir S
Slide 2: Investor Presentation February 2022
vestor Presentation February, 2022
Slide 3: Forward-looking statements disclaimer
Certain statements in this document may be forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties like government actions, local political or economic developments, technological risks, and many other factors that could cause actual results to diff
Slide 4: About Us, Ester 2.0, Investment Thesis, Business Overview, Q3 FY22 Performance
About Us Ester 2.0 Investment Thesis Business Overview Q3 FY22 Performance 3
Slide 5: Diversified business portfolio and sales mix (Q3 FY22)
Diversified business portfolio Sales Mix (Q3 FY22) Polyester Comprehensive product suite Films 67% State-of-the-art manufacturing facilities Specialty Global footprint Polymers 12% Experienced management team Engineering Plastics 21% Strong Financial profile 4
Slide 6: Key facts: incorporation, headquarters, footprint, credit rating
1985 GURGAON, INDIA #3 Year of Incorporation Corporate Headquarters Business Segments* 43 COUNTRIES 652 CRISIL A- (positive outlook) Global Footprint People Credit Rating (Long Term) * PF - Polyester Film; SP - Specialty Polymers; EP - Engineering Plastics 5
Slide 7: Manufacturing facilities and headquarters locations
Sitarganj Haryana Uttarakhand Gurgaon Khatima Telangana* Corporate Headquarter Manufacturing facility *New BOPET Film plant under implementation 6
Slide 8: We serve more than 40 countries
We serve more than 40 Countries 7
Slide 9: Ester 2.0
Ester 2.0 ” Company “Specialty
Slide 10: Ester 2.0: Specialty Company
Knowledge Innovation ESTER Customization 2.0 Technology 9
Slide 11: Ester 1.0 vs Ester 2.0 achievements
Achievements Ester 1.0 Ester 2.0 Specialty Polymer SBU Revenues oLargely patent protected (FY12-FY16) (FY17-FY21) – high entry barriers Commoditized product 2.4% CAGR 8.8% CAGR oHigh sustainable margins portfolio EBITDA oHigh growth potential Limited bargaining Film SBU power (FY12-FY16) (FY
Slide 12: Revenues, EBITDA, EBITDA margins and PAT FY12-FY21
Revenues (Rs.cr) EBITDA (Rs.cr) 236 886 928 896 1,028 1,039 992 189 700 771 707 807 108 74 71 70 66 35 41 43 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 EBITDA Margins (%) PAT (Rs.cr) 142 23.8% 100 18.2% 31 8 4 7 5 8.0% 7.9% 9.1% 6.1% 8.1% 10.5
Slide 13: Debt, ROCE and dividend payout
Debt (Rs.cr) ROCE (%) 335 363 348 304 300 290 31% 28% 237 242 142 157 14% 8% 7% 7% 7% 3% 3% 3% FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 Dividend Payout (%) 37.2% 20.9%19.9% 13.4% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% FY12 FY13 FY14 FY15 FY16 FY17 FY
Slide 14: WACC and FY21 ROCE
31% 9% WACC FY21 ROCE *Source: Bloomberg 13
Slide 15: Shareholding pattern
34.23% 40.86% 40.86% Mar 19 Mar 20 Mar 21 59.14% 59.14% 64.04% 1.73% 14
Slide 16: Investment thesis: Specialty Polymers and Polyester Films
Specialty Polymers - Polyester Films - High Largely IP protected share of value added product portfolio products Rewarding shareholders with Scaling up capacities dividend Strong balance sheet 15
Slide 17: Green Initiatives, Focus on Sustainability
Green Initiatives Focus On Sustainability FREE PACKAGIN' BIO-BASED Fuel Consumption ist Wrap / Shrink Film) me Pvec FREE PACKAC (Transparent High B r fi REPLACEMENT ized High Barrier film é PACKAGING MATER Reduction/ Recycling
Slide 18: Specialty Polymer
Specialty Polymer
Slide 19: Largely IP protected business
Customer High entry retention Largely IP High barriers – ensured as Marquee Export protected margin patent largely clientele oriented business business protected patent protected
Slide 20: Business Opportunity: stain resistant carpets
Problem Solution Business Opportunity USA, largest High cost towards carpet stain Flexible low cost solution producer of Carpets removal Ester has developed a PET based & Rugs boasts of Stain marks on (nylon) carpets given master batch, which imparts permanent spillover / spillage of liquid shor
Slide 21: Innovative PBT polymers supplied to a global chemical leader
Regularly manufacturing & supplying Innovative Signed ‘Manufacture and Supply Agreement’ with a Polybutylene Terephthalate (PBT) polymers to a global global chemical leader in April 2019 effective 1st April chemical leader 2019 for 2 years for 400 MT per annum Ester Industries is among the only comp
Slide 22: Strong product pipeline
MB07 o MB07 is added to make polyester dye-able with deeper and darker color o Achieved customer approval after 3 years of relentless hard work o Started commercial sales LMC 03 Strong o Techno commercial qualification achieved product o Customers are introducing their final product in the marke
Slide 23: Applications and products
Consumer electronics Polyethylene Terephthalate (PET) Textile – Flame Retardant, Deep dyeable master batches, Cationic dyeable master batch Applications Polybutylene Terephthalate (PBT) Products Carpets – Stain Resistant Master Batches Carpets – Deep Dyeable Master Batch Polyethylene Naphthalate (PE
Slide 24: Specialty Polymers Q3 FY22 performance
Figs. in cr Q3 Q3 Q2 9M 9M Particular % % % FY22 FY21 FY22 FY22 FY21 Volumes (MT) Sales 953 600 58.7 884 7.7 2698 1496 80.3 Q3FY21 Q3FY22 (Vol's MT) Revenue 44 13 234.1 46 (3.2) 125 35 253.6 191 Others 53 EBIT 12 1 1487.4 17 (29.1) 42 5 692.9 LMC07 25 0 Margins +2,157 (997 +1,856 27.3 5.8 37.3 33.5
Slide 25: Packaging Film Business
Et E zi ‘ls g 2 Packaging Film Business
Slide 26: Global and domestic scenario
Global Scenario: Domestic Scenario: Demand growth of 5% - 6% Strong double digit growth rate of 10%-12% pa over past 5 years BOPET film used in flexible packaging applications will continue to be the key end use sector, Low per capita consumption of BOPET; new accounting for nearly 60% of gl
Slide 27: Polyester film capacities and key facts
60,000 13,200 #30+ MTPA MTPA Years of experience Polyester Film Mfg. capacity Metallized Polyester Film Mfg. capacity 67,000 48,000 43 23% MTPA MTPA Export market Share of value-added Polyethylene Terephthalate BOPET Film Capacity (# of countries) products (Q3FY22) (Polyester) chips Mfg. expansion u
Slide 28: Value added share, EBIT margins, domestic and export mix
Value Added (%) EBIT Margins (%) – as per Domestic Exports segmental results 20 30 23 23 17 17 15 30 29 70 77 71 FY19 FY20 FY21 FY19 FY20 FY21 FY19 FY20 FY21 Product mix – despite reduction Pass through business model – in recent past, aiming towards provides protection against Balanced mix of domes
Slide 29: Applications and products
White Opaque High Clear Flexible Packaging Applications High Barrier Embossable Barrier Packaging Products Heat Saleable Twist Wrap Embossing Shrink film Anti - Static Lidding Metalized High Matte Label & Graphics Barrier 28
Slide 30: Packaging Film Q3 FY22 performance
Figs. in cr Particulars Q3FY22 Q3FY21 % Q2 % 9M FY22 9M FY21 % FY22 Sales 14,248 14,299 (0.4) 14,591 (2.4) 44,122 41,928 5.2 (Vol’s MT) Revenue* 244 181 34.8 213 14.5 682 532 27.9 EBIT+ 40 52 (23.1) 28 41.2 104 176 (41.2) Margins (%) 16.2 28.5 (1225 13.2 +306 bps 15.2 33.1 (1,790 bps) bps) *includin
Slide 31: Capex of Rs.587cr: new BOPET plant in Telangana
Capex of Rs.587cr to result in.. 23.8 24.3 EBITDA Margin (%) EBITDA 176 110 Revenue Internal Accruals 92 Debt 410 388 456 Capex FY24 FY25 Setting up state of the art 48,000 MTPA BOPET Film plant and 8,333 MTPA Metallized BOPET Film plant in Telangana through Wholly Owned Subsidiary Achieved fina
Slide 32: Engineering Plastics
ESTER es INDUSTRIES LTD. neering stics
Slide 33: Engineering Plastics key facts
# 350 13,500 “Gold 26+ #3 grades MTPA Winner ” Years of Diverse State-of-the- “Fastest Manufacturing experience product art growing capacity portfolio compounding Enterprise – lines Processing Engineering Polymers” 2015 32
Slide 34: Diverse product portfolio and backward integration
Diverse product portfolio Backward integrated player Increasing share of high “Unit relocation” to result in margin products margin expansion Strong sector tailwinds 33
Slide 35: Applications and products
Switchgear Industry Polybutylene Terephthalate (PBT) MCB, MCCB, RCCB, etc. Case, Cover & other Parts Polyethylene Terephthalate (PET) Lighting Industry Switches, Sockets, LED/CFL Holders, etc. Polyamide 6 (Nylon 6) Appliances Industry Applications Knobs, Rotary Switches, Couplers, Body Parts, etc. P
Slide 36: Engineering Plastics Q3 FY22 performance
Figs. in cr Particulars Q3 FY22 Q3 FY21 % Q2 FY22 % 9M FY22 9M FY21 % Sales 2,910 4,420 (34) 2,974 (2.2) 8,284 9,244 (10) (Vol’s MT) Revenue 77 61 26.2 74 4.1 210 127 65.4 EBIT 16 12 33.3 18 (11.1) 56 19 +194.7 Margins 21.3 19.1 +220 bps 23.7 (240 bps) 26.6 14.9 +1,170 bps (%) Remunerative prices
Slide 37: Q3 FY22 Performance Overview
MFY22 mance view 36
Slide 38: Consolidated Q3 FY22 results
Particulars Q3 Q3 FY22 % Q2 FY22 % 9MFY22 9MFY21 % (Rs.cr) FY21 Revenues 365 256 43.0 333 9.6 1,017 695 46.3 EBITDA* 64 58 10.3 59 8.4 187 183 2.2 Margin (%) 17.4 22.5 (510 bps) 17.6 (20 bps) 18.4 26.3 (790 bps) PAT 36 33 8 33 9.1 106 108 (0.9) Margin (%) 9.7 12.9 (320 bps) 9.9 (20 bps) 10.6 15.5 (4
Slide 39: Chairman's commentary on results
Commenting on the results, Mr. Arvind Singhania, Chairman, Ester Industries said “We are pleased with our performance for the quarter wherein we have delivered a healthy topline growth both on a Y-o-Y and Q-o-Q basis. The growth was largely broad based with all our businesses registering healthy run
Slide 40: About Us and contact information
About Us: (CIN :- L24111UR1985PLC015063) Incorporated in 1985, Ester Industries Limited (EIL) is an ISO 9001:2008,ISO 22000:2005,TS16949:2002 certified Company engaged in the manufacture of polyester films, specialty polymers, engineering plastics and polyester chips with manufacturing facilities lo
Slide 41: Thank You
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