Welspun Corp Limited · NSE:WELCORP
Welspun — Q4 FY23 Earnings Presentation
36 slides from Welspun's earnings presentation, May 31, 2023
Slide 1: Stock exchange cover letter
WCL /SEC/2023 May 30, 2023 To, BSE Ltd. National Stock Exchange of India Ltd. Department of Listing, Exchange Plaza, P. J. Towers, Dalal Street, Bandra-Kurla Complex, Mumbai – 400 001. Bandra (E), Mumbai – 400 051. (Scrip Code: Equity - 532144), (Symbol: WELCORP, Series EQ) (NCD– 960468, 960491 & 97
Slide 2: Business Update: Robust Operating Performance
BUSINESS UPDATE Robust Operating Performance May 30, 2023, Mumbai: Welspun Corp Ltd. (WCL), a flagship Company of the Welspun Group, announced its consolidated financial results for the quarter and year ended March 31, 2023. Achieved > 1 Million MT of Global Line Pipe Sales in FY23, 8th time in la
Slide 3: Key Drivers - India, USA, Saudi Arabia
BUSINESS UPDATE A.1) Key Drivers - India Target to increase natural gas consumption from 6% to 15% in our energy mix by 2030 Gas pipeline network expected to reach 35,000 kms from 22,000 kms in the next 4-5 years Oil demand expected to rise from 4.7 million barrels per day (bpd) in 2021 to 7.4
Slide 4: Business Update: DI Pipes
BUSINESS UPDATE Aims to achieve a 50% growth in its gas production by 2030 Desalinated Water Transportation capacity being significantly increased Outlook We are seeing a resurgence in the Oil and Gas sector and continued robust demand in the Water sector. Recently, our associate company, EPIC h
Slide 5: Business Update: TMT Bars
BUSINESS UPDATE Outlook We have already received all necessary approvals and accreditations in the states of Gujarat, Rajasthan, Maharashtra, Madhya Pradesh, Chhattisgarh, Uttar Pradesh and Punjab, which being our top priority areas. We are seeing a consistent demand from all the above states and ha
Slide 6: Stainless Steel - WSSL
BUSINESS UPDATE Success Metrics Product Reach (no.s) Dealer Network 300 252 120 200 89 100 69 33 24 0 23 Districts Taluka Total in Gujarat Actual being Served Dec-22 Mar-23 May-23 (D) Stainless Steel - WSSL Sales Volumes 3000 2783 2000 1557 1448 1278 1081 1009 1079 1000 692 0 Q1 FY23 Q2 FY23 Q3 FY23
Slide 7: Outlook: Stainless Steel and Sintex BAPL
BUSINESS UPDATE Outlook We have seen a strong turnaround in performance, both operational and financial. WSSL turned EBITDA positive. The current Order Book stands at ~ 3,500 MT valued at ~ Rs. 155 crores The company received BIS IS 6529 (Blooms / Ingots), BIS IS 6603 (Bars) and BIS 17875 certificat
Slide 8: Company Outlook and ESG Initiatives
BUSINESS UPDATE We are not exploring any capital intensive options like ship building. Instead, we are exploring options viz. Ship Recycling and Repair. In this regard, we are in discussions with various global companies and would complete our assessment in the next 2 quarters. The endeavor being to
Slide 9: Management Comments
BUSINESS UPDATE Management Comments “I am pleased by our robust operating performance to end the financial year. We have seen flawless execution and delivery for our customers resulting in strong cash flows and a substantial reduction in net debt. The acquisition of the plastic products business of
Slide 10: Consolidated Performance Snapshot
BUSINESS UPDATE Consolidated Performance Snapshot - Prior period figures are restated after the acquisition of the Steel business of Welspun Steel Limited - Sales Volume & Order Book includes our Saudi operations Sales Volumes Q4FY23 Q3FY23 Q4FY22 FY23 FY22 Line Pipes (KMT) 345 281 269 1,002 796 Pig
Slide 11: Saudi Financials
BUSINESS UPDATE Saudi Financials Key figures of East Pipes Integrated Company for Industry (EPIC): Figures in SAR Mn Particulars in SAR MN Q4FY23 Q3FY23 Q4FY22 FY23 FY22 Saudi Arabia Ops: Sales / Revenue 442 487 194 1,439 597 Gross Profit 52 70 15 156 28 Operating Profit 47 61 15 133 15 Net Profit a
Slide 12: Conference call details and About Welspun Corp
BUSINESS UPDATE Q4 FY23 Investor & Analyst conference call: Wednesday, 31st May 2023 | Time: 10:00 AM IST Primary Access: +91 22 6280 1325 / +91 22 7115 8226 International Toll-Free numbers o Hong Kong: 800 964 448 o Singapore: 800 1012 045 o UK: 0808 101 1573 o USA: 1866 746 2133 About Welspun
Slide 13: Welspun Corp Limited Q4 FY23
Welspun Corp Limited Investor Presentation Q4 FY23
Slide 14: Disclaimer
Disclaimer For any financial disclosures, the information contained herein is provided by Welspun Corp Limited (the “Company”), although care has been taken to ensure that the information in this presentation is accurate, and that the opinions expressed are fair and reasonable, the information is su
Slide 15: Sales Volumes at a Glance: Q4 FY23
Sales Volumes at a Glance: Q4 FY23 LINE PIPES 345 KMT (+28% YoY) PIG IRON TMT BARS 107 KMT 16 KMT SS BARS DRI 2,783 KMT 1 KMT (+123% YoY) DI PIPES SS PIPES 23 KMT 1,079 MT (-7% YoY) BILLETS Note: 49 KMT Pipe Sales volumes include (+173% YoY) Saudi Arabia operations 3
Slide 16: Consolidated Financial Results for Q4 FY23
Consolidated Financial Results for Q4 FY23 PARTICULARS (Rs Cr) Q4 FY-23 Q3 FY-23 QoQ Q4 FY-22 YoY Total Revenue from Operations 4070 2402 69.4% 2011 102.4% Other income 62 8 677.0% 402 -84.5% Reported EBITDA 483 174 176.8% 474 1.9% Depreciation and Amortisation 91 80 13.4% 63 44.0% Finance Cost 95 7
Slide 17: Consolidated Financial Performance
Consolidated Financial Performance PARTICULARS FY-13 FY-14 FY-15 FY-16 FY-17 FY-18 FY-19 FY-20 FY-21 FY-22 FY-23 Revenue (INR Cr) 9083 7705 8451 7380 6035 7587 8954 9957 7153 6505 9758 EBITDA (INR Cr) 919 844 951 891 737 815 708 1276 1152 1023 805 Basic EPS 6.1 2.8 2.6 5.8 1.0 6.0 2.6 25.6 29.8 16.8
Slide 18: Sales Volume Mix: Line Pipes (Long Term Trend)
Sales Volume Mix: Line Pipes (Long Term Trend) 764 635 646 632 650 629 626 578 573 510 506 India 500 393 413 423 Saudi 236 265 254 343 217 222 197 180 237 190 255 165 138 99 86 USA 123 106 96 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 India volumes close to India (KMT) 600 KMT , USA (KMT
Slide 19: Dare to Commit! Guidance for FY24
Dare to Commit! Guidance for FY24 • Top line of INR 15,000 Cr (growth of ~ 50%) • EBIDTA of INR 1,500 Cr (growth of ~ 90%) • Only Maintenance Capex • Strong focus on growth of Sintex, DI Pipes and WSSL • ROCE of 16% + (from 7% in FY23) • Increase in DJSI ESG rating to 60+ Guidance reflecting solid b
Slide 20: Guidance
Guidance Revenue (Rs. crore) EBITDA (Rs. crore) 15,000 1,500 1,276 1,152 9,957 9,758 951 1,023 8,954 891 7,705 8,451 7,380 7,587 7,153 6,505 844 737 815 708 805 6,035 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24* FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24* ROCE 32.1% 22.6% 21.3
Slide 21: WCL: Line Pipes
WCL : Line Pipes Top 15+ 3 50+ million metric ton Among Line Pipe Approvals from Pipes delivered Manufacturers O&G majors; since inception globally Qualifies for with multiple global bidding repeat orders 2.2 mn MT 6 manufacturing Used in Oil & Gas, Pipes Capacity facilities in 3 Water industry & co
Slide 22: Approvals & Accreditations: Line Pipes
Approvals & Accreditations: Line Pipes OIL & GAS TRANSPORTATION OTHERS 10
Slide 23: Global Supply Chain
Global Supply Chain SUPPLIER COUNTRY Dillinger France & Germany VAGB Austria Posco South Korea More than Nippon Japan 2 million JFE Japan metric tons of plates Bao China procured in last 10 years Healthy Relationships with Suppliers across the world: A key factor for our Global Leadership Position 1
Slide 24: Welspun Corp: Transforming into a Conglomerate
Welspun Corp: Transforming into a Conglomerate EXISTING NEW BUSINESS Large Diameter Pipe and Coating Pig Iron and Specialty Steel Billets & TMT* ABG Shipyards Plastic Products New Energy DI Pipes Amongst One of the Integrated One of the One of the Acquisition of a SCALE the Top 3 largest producer fr
Slide 25: Manufacturing Facilities: Pipes & Steel
Manufacturing Facilities: Pipes & Steel CAPACITY INDIA US SAUDI ARABIA TOTAL PRODUCTS / CITY ANJAR MANDYA BHOPAL JHAGADIA LITTLE ROCK DAMMAM LSAW 350 350 HSAW 250 150 305 350 375 1430 ERW/HFIW 200 175 375 Line Pipes (KMT) 1255 525 375 2155 TMT Bars (KMT) 350 350 DI Pipes (KMT) 400 400 SS Bars (KMT)
Slide 26: Line Pipes: Key Drivers
Line Pipes: Key Drivers INDIA USA SAUDI ARABIA • Expansion of National Gas Grid • Rig count close to pre-pandemic • Saudi Aramco to boost oil Pipeline driven by increasing LNG levels production from 10 million to 13 capacities million barrels a day by 2027 • Permian basin expected to be the • City G
Slide 27: Ductile Iron Pipes: Drinking water supply infrastructure in India
Ductile Iron Pipes: Huge focus on creating drinking water supply infrastructure in India Our Focus Market is West, Central and North India Legend: Focus Market - Phase 1 Received State Approval 15
Slide 28: Specialty Steel: SS Pipes Outlook
Specialty Steel: SS Pipes Outlook Robust demand expected going forward Key Drivers • Make in India initiative by the government providing push to local manufacturing • High value business and a differentiated import-substitution play with obvious synergies with existing business and capabilities, ch
Slide 29: TMT: Our Differentiated Strategy
TMT: Our Differentiated Strategy Forward Integration from Billets to TMT Growth Drivers • Infrastructure: Massive spending expected in the sector including – • PM Gati Shakti National Master Plan: an expected outlay of INR 100 lakh Cr • Pradhan Mantri Awas Yojana-Urban's (PMAY-U) 'Housing for All' m
Slide 30: Nauyaan Shipyard (erstwhile ABG Shipyard)
Nauyaan Shipyard (erstwhile ABG Shipyard) • Metal / metal scrap not required for business purposes is being disposed off which would result in a steady cash flow • Not exploring any capital intensive options like ship building • Assessing low capex, non-cyclical, high return and value accretive prop
Slide 31: Sintex BAPL – Plastic Products
Sintex BAPL – Plastic Products Manufacturing Locations • High Brand recall for Sintex across the country, current market share in Water Tanks • Kalol Gujarat estimated to be 8-10% • Nalagarh Himachal Pradesh • Widespread sales network of approximately • Namakkal Tamil Nadu 900 Distributors and 13,00
Slide 32: Transaction Rationale – Sintex BAPL
Transaction Rationale – Sintex BAPL 1. Growth Driver: Entry into the Consumer Segment through a Super Brand which is well known across the country and has a premium positioning 2. Extensive Distribution Network: Widespread Distribution and Retail Network is in line with Welspun Group’s Mission “Har
Slide 33: The Way Forward: Sintex BAPL
The Way Forward Sintex BAPL • Re-energize distribution network, product & brand and combine with WCL’s strength in Supply Chain efficiencies • Efforts to regain lost Market Share which was historically as high as 23-25% • Strong and experienced Management team already in place • No immediate large c
Slide 34: Sustainability Strategy
Sustainability Strategy • Energy Efficiency • Water Intensity • Health & Safety • Human Capital • Renewable Energy Ranked in the Top 7% in • Waste Intensity Steel Industry by S&P Global’s Dow Jones Sustainability Index (DJSI) • Gender Diversity Corporate Sustainability Assessment • Impacting Lives i
Slide 35: Sustainability Targets
Sustainability Targets ASPECTS FY 2020 - 21 FY 2021 - 22 FY 2022 - 23 GOAL 2025 GOAL 2030 GOAL 2040 Carbon Neutrality - % Renewable Energy (RE) 0% RE 0% RE 0% RE 10% RE 20% RE Carbon neutral Water Neutrality - Water Intensity 0.63 KL/MT 0.64 KL/MT 0.57 KL/MT 0.55 KL/MT 0.40 KL/MT Water neutral 1.53
Slide 36: Thank You!
Thank You! Welspun Corp Limited CIN: L27100GJ1995PLC025609 For further queries, contact Name : Mr. Gaurav Ajjan Email : gaurav_ajjan@welspun.com www.welspuncorp.com 3