Parag Milk Foods Ltd. · NSE:PARAGMILK
Parag Milk Foods — Non-Deal Roadshow (June 2019)
45 slides from Parag Milk Foods's roadshow presentation, Jun 20, 2019
Slide 1: Intimation of investor meetings to stock exchanges
June 20, 2019 Compliance Department Compliance Department BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers, Exchange Plaza, Dalal Street, Fort, Plot No. C/1, G-Block, Bandra-Kurla Complex, Mumbai – 400 001 Bandra (E), Mumbai – 400 051 Scrip Code: 539889 Scrip Symbol: PA
Slide 2: Parag Milk Foods Limited Investor Presentation June 2019
PARAG MILK FOODS LIMITED Investor Presentation June 2019
Slide 3: Safe Harbor
Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by Parag Milk Foods Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any secu
Slide 4: Contents
Contents 1 Industry Dynamics 4 Financial Highlights 2 Company Overview 5 Vision 2020 3 Key Developments in FY19 6 Annexures 3
Slide 5: Industry Dynamics
Industry Dynamics
Slide 6: Indian Dairy Market
Indian Dairy Market Indian Dairy Market (US$ 107 Bn) Organised Dairy Market Unorganised Dairy (US$ 15 Bn) Market (US$ 92 Bn) Traditional Milkmen / Self Consumption at Home Cooperatives (US$ 7 Bn) Private Dairies (US$ 8 Bn) Vendors (US$ 34 Bn) (US$ 58 Bn) Milk production volume break-up Marketable Mi
Slide 7: Tremendous Growth Potential across Product Segments
Tremendous Growth Potential across Product Segments Liquid Milk Ghee Paneer Curd +15.0% +14.8% Traditional Products Growth 9,761 7,358 90,567 20,403 +14.8% +14.8% CAGR of 22,403 39,119 5,149 9,224 2,448 4,373 1,851 3,239 15% 2010 2014 2020E 2010 2014 2020E 2010 2014 2020E 2010 2014 2020E UHT Milk Fl
Slide 8: Company Overview
Company Overview Sustainability Innovation
Slide 9: Parag at a Glance
Parag at a Glance Strong State-of-the-art Strong 170+ SKU’s 7 Brands Ranked #1 Relationships Facilities Distribution Aggregate milk Gowardhan processing capacity Pan-India Go Established Strong of 2.9 mn litres per Diversified product Parag Milk Foods Distribution Network Pride Of Cows Relationships
Slide 10: Evolution of the Company
Evolution of the Company 1992 1998 2005 2008 2010 2011 Parag Milk Foods Ltd founded Commissioned Manchar Birth of Bhagyalaxmi Commissioned “Go Cheese Palamaner plant was Birth of ‘Pride of Cows’, a in 1992 with one purpose: plant and began manufacturing Dairy Farm - India’s most World” - India’s lar
Slide 11: Our Diverse Product Portfolio catering to all segments of customers
Our Diverse Product Portfolio catering to all segments of customers Brands Target Customer Group Positioning Household consumers seeking premium quality cow’s milk Health enthusiasts Premium Children and the youth primarily for direct consumption On-the-go consumption as source of instant no
Slide 12: Our Brand Power
Our Brand Power 2nd Largest Player in Cheese in the India with Pioneers of Fresh Paneer with a 75 Day Shelf Life 35% Market Share Leaders & Pioneers of Cow Ghee category Own one of the Largest Cow Farms in India under Brand ‘Gowardhan’ Ghee India’s First Company to launch a truly made Leading privat
Slide 13: Pan-India Reach Distribution Network
Last mile availability from ‘Farm to Fork’ Pan-India Reach Distribution Network Route-to-market Strategy Depot Super Stockist Jammu 19 Depots Jalandhar Parwanoo Karnal Fresh Milk Delhi Siliguri Guwahati 140+ Exports Jodhpur Udaipur Jaipur Kanpur Patna Super Stockists Products General Trade Ranchi Mo
Slide 14: Partner with Leading Institutions and Quick Service Restaurants
Partner with Leading Institutions and Quick Service Restaurants Interact with Customers at Customization of the Maintaining the Strong/ Long term the Inception Phase of product according to the Exclusivity of the Relations with the Product and even help Need Product Customers them to curate a menu S
Slide 15: A Pan-India Manufacturing Footprint
A Pan-India Manufacturing Footprint Key Features : Parag’s Manufacturing Footprint State-of-the-art Technology Newly Acquired • One of the Largest Cheese Plants in India Facility from Danone Sonipat Plant, Haryana • India’s 1st state-of-the-art fully integrated Whey Protein Plant • Fully automated P
Slide 16: Farmer Relationship is an Integral part of our Business
Farmer Relationship is an Integral part of our Business 3-tier Milk Procurement Process Procurement Network Farmer Services Village collection centres Never Say No for Milk procure milk Correct Quantity & Tier 1 Quality from over 2 lakh farmers in 29 districts Haryana Supplying Cattle feed at subsid
Slide 17: Board of Directors
Board of Directors Mr. Devendra Shah Mr. Pritam Shah Chairman Managing Director Mr. B. M. Vyas Mr. Sunil Goyal Director Independent Director Mr. Narendra Ambwani Mr. Nitin Dhavalikar Independent Director Independent Director Mrs. Radhika Pereira Mr. Ramesh Chandak Independent Director Director The B
Slide 18: Our Management Team & Talent Pool
Our Management Team & Talent Pool Ms. Akshali Shah Mr. Vimal Agarwal Mr. Shirish Upadhyay VP – Strategy (Sales & Marketing) Chief Financial Officer An MBA in Family Managed Business from S.P. Jain He is a Chartered Accountant and an MBA by He . has 20+ years of experience in dairy and has Institute
Slide 19: Our Strategy for Value Creation
Our Strategy for Value Creation Increase Operational Efficiencies Focus on Health & Nutrition Leverage in-house technological, R&D capabilities Introduce healthy & nutritious product variants like to: Whey protein powder for mass consumption and in Maintain strict operational controls different
Slide 20: Key Developments in FY19
Key Developments in FY19
Slide 21: Our Focus on Increasing the Value-Added Product Portfolio
Our Focus on Increasing the Value-Added Product Portfolio Several Value-added Products launched during FY19 Leading to Increased Contribution of Value- added Products 12.9% 14.3%* 20.8% 19.9% 17.7% Avvatar Whey Protein – Variants GO Protein Power – Mass Protein 20.0% Launched Variant 65.6% 66.1% 59.
Slide 22: North & East – Key Growth Driver
North & East – Key Growth Driver Distribution & Technology Infrastructure • > 200 new distributors added • Scale up in leveraging Technology – Bizom and • > 25K new outlets added Distribution Management • 100% Cold Infrastructure ready in System (DMS) Manufacturing Facility Sonipat, Haryana all key
Slide 23: Driving Execution Excellence through Theory of Constraints Framework
Driving Execution Excellence through Best-in-Class Theory of Constraints Framework In Retail Motivated In Supply Chain Increase reach Distributors Increase range Objective Move from primary sales Replenishment in small and focus to secondary sales Higher Sales Growth frequent lots according to foc
Slide 24: Integration of Technology across all verticals
Integration of Technology across all verticals Business intelligence and Seamless integration of our Analytics captured through manufacturing facilities, cold SAP chain and our distribution network of super-stockists & retailers Theory of Constraints (Vector) Dashboard for live monitoring of order t
Slide 25: Marketing Campaigns & Consumer Engagement Initiatives
Marketing Campaigns & Consumer Engagement Initiatives Gowardhan Milk Pride of Cows North East Region Gowardhan Pure Outdoor Milk Radio Campaign Campaigns for Conducted in Delhi Gowardhan Ghee on Red FM, Radio & Go UHT Milk City, Big FM, Radio conducted in Mirchi and Fever 104 North East Region Pride
Slide 26: Financial Highlights
Financial Highlights
Slide 27: Key Financial Highlights
Key Financial Highlights Revenue (Rs. Mn) EBITDA (Rs. Mn) +13.5% +20.2% 23,957 2,235 19,545 1,933 14,441 1,072 FY15 FY18 FY19 FY15 FY18 FY19 PAT (Rs. Mn) Margins (%) EBITDA% PAT% ROCE% +39.1% 1,207 17.2% 15.4% 871 12.1% 9.9% 9.3% 7.4% 322 4.5% 5.0% 2.2% FY15 FY18 FY19 FY15 FY18 FY19 FY15 Pre IPO On
Slide 28: Key Financial Highlights
Key Financial Highlights Working Capital (In Days) Operating Cash Flows (Rs. Mn) -5.6% +159.5% 72 68 1,591 613 FY18 FY19 FY18 FY19 Fixed Assets Turnover Ratio Debt to Equity 19.5% 6.0 0.4 5.0 0.3 FY18 FY19 FY18 FY19 On Consolidated Basis 27
Slide 29: Consolidated Profit & Loss Statement
Consolidated Profit & Loss Statement Particulars FY19 FY18 Revenue from Operations 23,956.6 19,545.1 Raw Material Costs 16,573.6 13,678.9 GROSS PROFIT 7,383.0 5,866.2 Gross Margins 30.8% 30.0% Employee Expenses 949.9 735.2 Other Expenses 4,198.1 3,198.1 EBITDA 2,235.0 1,932.9 EBITDA Margin % 9.3% 9.
Slide 30: Consolidated Balance Sheet
Consolidated Balance Sheet Particulars Mar-19 Mar-18 Particulars Mar-19 Mar-18 ASSETS EQUITY AND LIABILITIES Non-current assets Equity Property, plant and equipment 4,023.4 3,922.7 Equity Share capital 839.4 838.9 Capital work-in-progress 290.3 204.0 Other equity 7,432.0 6,282.8 Other intangible ass
Slide 31: Vision 2020
Vision 2020 30
Slide 32: Vision 2020
Vision 2020 FY 2018 FY 2020 Revenue Rs. 1,955 Crs Rs. 2,700 – 3,000 Crs EBITDA Margin* 10.5% 11- 12% ROCE 15.8% 18-20% * Includes Other Income 31
Slide 33: Annexures
Annexures
Slide 34: India's Favourable Dynamics offer Huge Opportunities
India’s Favourable Dynamics offer Huge Opportunities Rising Middle Class • Middle class households to grow from 255 million in 2015 to 586 million in 2025 at a CAGR of 8.7% Population & Income • Rising income & disposable income to drive consumption of milk Levels & dairy products India – GDP Growth
Slide 35: India Contributes > 20% of Global Milk Production
India Contributes > 20% of Global Milk Production Top Milk Producing Countries (Million MT) Global - Animal Wise Milk Production - 2017 Countries 2017 2018E 2019E 2020E 2027E CAGR 11.5% 3.5% India 169 174 181 188 244 3.7% Cow EU – 28 164 167 167 169 177 0.8% Buffalo USA 98 98 99 100 105 0.7% Goat &
Slide 36: Milk Production in India
Milk Production in India Liberalization of the sector in 1991 led to entry of private players Dr. Verghese Kurien initiated 244 operation Flood to increase Milk Production 188 +4.3% 169 116 78 +2.8% 51 30 17 20 21 1950 1960 1970 1980 1990 2000 2010 2017 2020E 2027E Milk Production (Million MT) Sourc
Slide 37: Ghee Market
Ghee Market (Butter Oil/Cooking Oil/Clarified Butter) India’s Ghee Market Size (in US$ Million) Key Highlights 20,403 17,985 13,836 15,791 • Ghee is traditionally used as cooking oil in Indian +16.0% 10,582 households 8,030 6,030 3,075 4,463 • It is the 2nd largest category in the Indian dairy indus
Slide 38: Cheese Market
Cheese Market India’s Cheese Market Size (in US$ Million) Key Highlights 513 • Cheese is one of the fastest growing segments 410 among dairy products in India 328 +25.3% 263 • Rise in food service outlets and changing food 204 134 164 habits are major drivers 85 106 54 69 • Earlier, the cheese marke
Slide 39: Paneer (Cottage cheese)
Paneer (Cottage cheese) India’s Paneer Market Size (in US$ Million) Key Highlights 9,761 • Paneer is to India what cheese is to the Western 8,582 world and is an integral part of many Indian 7,522 +16.8% 6,597 recipes 5,030 3,806 2,896 • Paneer is the third largest segment in the milk 1,940 1,358 pr
Slide 40: Curd (Dahi)
Curd (Dahi) India’s Curd Market Size (in US$ Million) Key Highlights 7,358 6,478 5,687 • Curd industry has transformed from being a +15.4% 4,940 3,746 product that was traditionally made at home to a 2,836 branded & packaged product 2,134 1,597 1,179 • The organized curd market is growing rapidly at
Slide 41: UHT & Beverages
UHT & Beverages India’s UHT Market Size (in US$ Million) India’s Flavoured Milk Beverages Market Size (US$ Million) 1,552 716 1,239 582 985 463 +28.4% 791 +25.5% 373 493 239 313 149 194 60 90 104 2009 2011 2013 2015 2017 2018 2019E 2020E 2009 2011 2013 2015 2017 2018 2019E 2020E Key Highlights Key H
Slide 42: Whey Protein
Whey Protein Key Highlights Sports Health & Category Nutrition Nutrition Segment Segment • Whey Protein market is estimated at 35,000 MT, translating US$ 225-300 US$ 225-300 into business potential of US$ 450 Million, growing upwards Market Size Million Million of 25% • Parag has the most integrated
Slide 43: Liquid Milk Market
Liquid Milk Market India’s Liquid Milk Market Size (in US$ Million ) Key Highlights 90,567 • A majority (77%) of the milk sold in India is 79,015 unorganized and in the form of loose milk sold by 68,731 +16.4% 59,791 milkmen 45,090 33,896 25,463 • The organized sector in liquid milk is highly 18,060
Slide 44: We are present in all key Cow milk procuring States
We are present in all key Cow milk procuring States In Million MT Milk % Share of CAGR Cow Milk CAGR Sr. % Share of States Production Total Milk for last Production for last No Cow Milk (2016-17) Produced 2 years (2016-17) 2 years 1 Tamil Nadu 7.6 4.6% 2.9% 7.1 93% 3.1% 2 Karnataka 6.6 4.0% 3.5% 4.6
Slide 45: Contact Us
Contact Us Company : Investor Relations Advisors: Parag Milk Foods Limited Strategic Growth Advisors Pvt. Ltd. CIN: L15204PN1992PLC070209 CIN: U74140MH2010PTC204285 Name: Natasha Kedia Mr. Rohan Adhiya / Mr. Deven Dhruva Email: natasha.kedia@paragmilkfoods.com rohan.adhiya@sgapl.net / deven.dhruva@s