Coromandel International Limited · NSE:COROMANDEL
Coromandel International — Investor Presentation (May 2019)
43 slides from Coromandel International's investor presentation, May 2019
Slide 1: Coromandel: Future Positive May 2019
Coromandel: Future Positive May 2019
Slide 2: Agri Landscape
Agri Landscape Birds Paradise: Bio-Diversity at Coromandel’s Kakinada Plant
Slide 3: Indian Agriculture: The Global Giant
Indian Agriculture: The Global Giant Crop India Ranking % Share Pulses 1st 21% Seed Cotton 2nd 22% 3rd largest Agriculture F&V 2nd 11% producer globally Sugarcane 2nd 18% Largest cropland globally Cereals 3rd 10% Largest irrigated area Source: U.S. Geological Survey Source: FAOSTAT India Agri export
Slide 4: ….But Productivity Gaps exist
….But Productivity Gaps exist Falling per capita land holding Imbalanced Nutrient Usage Yield comparison (Tonnes/ ha) 2.5 Avg landholding size (ha) 15 N:P:K Consumption Ratio 2 2.3 1.5 10 1.4 Soyabean 1 5 Ideal Ratio 0.5 2.7 4:2:1 0 0 1970-71 1980-81 1990-91 2000-01 2010-11 2015-16 FY09 FY10 FY11 FY
Slide 5: Efforts being made to Double Farmer Income by 2022
Efforts being made to Double Farmer Income by 2022 Policy Measures in Union Budget 19-20 ▪ Direct Income Support: USD 11 bil/ year ▪ Higher allocation under Institutional credit ▪ Agri exports focus Source: Niti Aayog ▪ Increase usage of Bio fuels ▪ Increasing output – Productivity, Cropping Intensi
Slide 6: Agri Growth Levers
Agri Growth Levers Food Security Improved support price (at 50% Cost of Prod ) 8000 17-18 7000 Rs/ qtl 4% 25% 18-19 6000 FY50 5000 28% 4000 11% 333 mil MT 3000 13% 19% 2000 1.6 B 1000 0 FY18 Paddy Maize Arhar Moong Soyabean Cotton Higher Source: Ministry of Agriculture 280 mil MT Disposable 1.3 B ….
Slide 7: Agri Growth Levers
Agri Growth Levers Dietary Shifts Digital India Indian Consumption Basket Unified National Agriculture Market USD 350 Bil USD 85 bil USD 160 Bil Others Oil F&V USD 34 bil USD 95 bil Milk & Meat USD 44 bil Cereals 2010 2030 Cereals & Pulses Milk & Meat F&V Oil Others Source: CII Mckinsey Source: SFAC
Slide 8: …along with Agriculture reforms
…along with Agriculture reforms Doubling Farmer Income by 2022 Improving Integrated Productivity Improvement Water & Inputs Market Farming Realization Minimizing Increasing Bio Micro crop losses: Balancing Allied E Irrigation technology Irrigation Crop nutrition Activities Procurement Coverage Prote
Slide 9: & Positive Policy Measures
& Positive Policy Measures Nutrient Based Subsidy Make in India …..Towards deregulating the Fertiliser industry …..Thrust towards Domestic Manufacturing Fixed Fixed subsidy & variable farm gate prices MRP 35% 35% 34% 27% 30% 27% 37% 60% 52% 63% 65% 65% 66% 73% 70% 73% 63% 40% 48% 37% Pre NBS FY11 FY
Slide 10: & Positive Policy Measures
& Positive Policy Measures Direct Benefit Transfer …..Towards balancing Soil Health Subsidy Disbursement on Farmer Purchase Dept of Fert ▪ Informed farmer purchases based on Soil Health Status Purchase info triggered ▪ Subsidy to manufacturer to be paid on a periodic basis ▪ Lead to digitization & i
Slide 11: Our Industry
Our Industry Birds Paradise at Coromandel’s Kakinada Plant: Home to ~100 species of migratory birds
Slide 12: Indian Fertiliser Industry: Overview
Indian Fertiliser Industry: Overview Indian Nutrient Demand Fertiliser: Supply Demand Balance 18-19 Production & Consumption (N+P2O5) (mil tons) (in mil tons) in mil tons 31.7 59.0 2.51 24.8 48.7 6.71 18.6 15.8 16.74 25.5 21.4 20.5 16.5 3.0 Urea NPK Potash Demand Domestic capacity Production Consump
Slide 13: Opportunities in Inputs space: Ag Nutrients
Opportunities in Inputs space: Ag Nutrients Nutrient Deficient India Soils Source: IISS Bhopal ▪ More than 50% of the districts deficient in essential plant nutrients- Opportunity for Balanced Nutrition ▪ Relatively untapped Secondary & Micro Nutrients segment ▪ Organic products to balance plant gro
Slide 14: Opportunities in Inputs space: Micro Irrigation & Water Soluble Fertiliser
Opportunities in Inputs space: Micro Irrigation & Water Soluble Fertiliser Area under Micro irrigation (mil ha) Potential: 69 mil Ha 7.7 Current coverage: 8 mil Ha 6.1 4.9 3.1 2005 2010 2012 2015 Benefits: Increase in Water Use Efficiency: 50 – 90% Productivity Increase: 40-50% ▪ Current Micro Irrig
Slide 15: Opportunities in Crop Protection space
Opportunities in Crop Protection space Indian Crop Protection Market (USD Bil) 3.2 2.1 3.1 2.3 ▪ Exports segment to grow by 9% p.a. Exports ▪ Domestic segment to grow by 7% p.a. Domestic FY15 FY20 Increasing Pest Incidence Herbicide Opportunities Opportunities in Generic Space Molecules going off pa
Slide 16: Industry Updates: 2018-19
Industry Updates: 2018-19
Slide 17: Challenging Agriculture Environment in 18-19
Challenging Agriculture Environment in 18-19 1 All India SW Monsoon: 91% LPA 2 Drop in reservoir levels during the 3 Resulting in Drop in acreage in followed by Deficit NE Monsoon (-44%) 2nd half Kharif (-2%) & Rabi (-4%) seasons NE Monsoon South Peninsula: Oct-Dec’2018 Reservoir levels – Mar’19 (%)
Slide 18: Rupee & commodity prices beginning to stabilize after sharp volatility during H1
… rupee & commodity prices beginning to stabilize after sharp volatility during H1 USD-INR Movement (Rs/USD) India PA CFR 768 768 768 757 757 757 74.00 750 750 750 730 730 730 728 72.00 70.00 68.00 Apr 18 May 18 Jun 18 Jul 18 Aug 18 Sep 18 Oct 18 Nov 18 Dec 18 Jan 19 Feb 19 Mar 19 April 19 66.00 Amm
Slide 19: Impact on the farm gate price….consumption moderation during H2
Impact on the farm gate price….consumption moderation during H2 Farm gate price (Rs/MT DAP) Indian Phosphatic Industry: Supply-Demand Scenario (in mil tons) 31000 21.7 29000 18.6 18.6 17.1 17.5 27000 16.5 15.8 10.6 7.1 14.0 6.2 4.7 25000 4.9 6.1 4.1 23000 3.7 21000 19000 11.8 12.2 12.2 12.9 12.9 10.
Slide 20: Coromandel: Who We Are
Coromandel: Who We Are - About Coromandel - Business Segments - Financials Birds Paradise at Coromandel’s Kakinada Plant: More than 50% Plant area covered under Green Belt
Slide 21: About Coromandel
About Coromandel Coromandel’s Manufacturing Presence India’s largest private sector Jammu Pioneers & market leaders in Phosphatic Fertiliser company Specialty Nutrients Rae Baereli Kota Udaipur 5th largest Ag Chem Indian Vadodara Nimrani No. 1 Organic Manure player in company Dahej Ankleshwar India
Slide 22: About Coromandel
About Coromandel Key Facts : ▪ Turnover: USD 1.9 bil (FY18-19) ▪ Market Cap: USD 2.1 bil (Mar 2019) ▪ Strong credit rating: ‘AA +’ (Stable outlook)’ with CRISIL India ▪ ~4500 employees & ~7500 contract staff ▪ International Linkages: FOSKOR, GCT, CANPOTEX, SQM, GETAX , QAFCO, ICL, OCP, YANMAR etc ▪
Slide 23: Global Strategic Alliances
Global Strategic Alliances Strategic Investment TIFERT – Phos acid venture in Tunisia ▪ Highly diversified sourcing Pact with QAFCO for supply MOP of Urea and Ammonia Canpotex - Canada ▪ Significant market presence in Ammonia and Sulphur Mitsui, Japan International markets Rock Phosphate Morocco, Is
Slide 24: Business Structure
Business Structure Subsidy / Non Subsidy DAP Sales EBITDA Phosphatic Fertilisers Complex Fertilisers 80% 68% SSP/MOP Nutrient Specialty G-Sulphur and Other Allied Business Nutrients & Water Soluble Organic fert Non subsidy EBITDA share has steadily improved Organic Manure 86% from 23% in FY08-09 to
Slide 25: Towards New Growth Segments
Growth Journey 2018 Bio Acquisition 2014 Farm Mechanization- Towards New Growth Segments Yanmar JV 2013 SSP- Liberty acquisition 2012 Technology tie up- Shell Crop Protection- New capacity New Expansion Strategic Technology 2011 Sabero acquisition addition: ~3 Businesses: into Retail Partnership Tie
Slide 26: Business Segments
Business Segments Birds Paradise at Coromandel’s Kakinada Plant: Largest breeding site in the East Godavari district for a variety of bird species
Slide 27: Coromandel Phosphatic Fertilisers
Coromandel Phosphatic Fertilisers ▪ C Train Expansion ▪ LIBERTY SSP acquisition 5.0 mil ton ▪ Largest Complex marketer in India 3.2 mil ton ▪ 22% of the domestic Phosphatics capacity 0.8 mil ton ▪ Ability to manufacture 13 different grades ▪ Differentiated offering thru Unique grades 0.3 mil ton ▪ D
Slide 28: Fertiliser Marketing
Fertiliser Marketing Sales (mil tons) Market Share Unique Grades (mil tons) 16.3% 3.0 1.4 38% 38% 39% 15.9% 16.3% 15.8% 1.2 37% 2.8 14.4% 14.6% 1.0 35% 2.7 33% 33% 2.6 0.8 33% 2.5 31% 1.1 0.6 31% 1.0 0.4 28% 0.8 0.9 0.8 29% 2.2 0.2 0.6 27% - 25% FY14 FY15 FY16 FY17 FY18 FY19 FY14 FY15 FY16 FY17 FY18
Slide 29: Fertiliser Manufacturing
Fertiliser Manufacturing Kakinada: Capacity: 1.9 mil tons High Nutrient Efficiency Phosphatic Production (in mil tons) Flexibility to manufacture multiple grades 3.1 83% 85% 90% 70% 70% 70% 80% 65% 2.9 Vizag: 2.7 70% 60% 2.5 50% Capacity: 1.2 mil tons 2.3 2.9 2.9 40% 2.1 30% 2.4 2.4 2.4 Integrated P
Slide 30: Coromandel Crop Protection
Coromandel Crop Protection 1990’s 2006 2009 2010 2011 2015 2018 Acquired Acquisition of Acquired Pasura Established: FICOM and Expansion to Bio Tech – Sabero Bio Pesticide pesticides unit of - China Office setting up Latin America Jammu Unit II Acquisition Acquisition BPM Jammu Unit I - R&D Centre 5
Slide 31: Crop Protection Operations
Crop Protection Operations Diversified Sales Global presence through Subsidiaries Bio Business: Synergistic Fit APAC 13% Africa Bio turnover (Rs Cr) 12% Netherlands 163 141 China Office 123 India Mexico 107 51% 95 South America Philippines 13% Nigeria Brazil Central America Argentina Australia Ameri
Slide 32: Crop Protection Operations
Crop Protection Operations Significant Manufacturing presence Ably supported by R&D Team Resulting in successful product launches Sarigam Plant R&D Centre, Hyderabad ▪ Manufacturing Capacity 80,000+ MT/ ▪ R&D facility at Hyderabad & Cuddalore ▪ 5 new product launches in FY19 annum from 6 locations ▪
Slide 33: Retail
Retail Farming Solutions Customer Reach 3 million farmers annually Products Services Telangana Ag Nutrients Farm Mechanization Convergence of Crop Chem Agri Insurance Products & Services: Seeds Credit One Stop Shop Vet Feed Soil/ Petiole Testing for Agriculture needs Andhra Pradesh Karnataka Farm Im
Slide 34: Specialty Nutrients
Specialty Nutrients Manufacturing Capability Crop based Product Solutions Increasing share of Focus products CSQM 15000 MT WSF 20% 20% 2012 34% 34% 39% Plant, Kakinada 44% Crop Solutions Infrastructure 2008 WSF Plant, Vizag Horticult Cereals Pulses Cotton ure 2006 Bentonite Sulphur Plant, Vizag- 250
Slide 35: SSP
SSP Maintaining Market Leadership With Quality Focus & Focus Product Approach 0.70 14% 16% Share of granulated & value added products 0.60 14% (%) 12% 0.50 60% 54% 10% 0.40 8% 50% 0.30 0.63 0.57 40% 0.55 0.52 6% 0.48 0.20 4% 30% 0.10 2% 20% 0.11 - 0% 10% FY14 FY15 FY16 FY17 FY18 FY19 0% FY14 FY15 FY
Slide 36: Organic Manure
Organic Manure Product Portfolio Growth Drivers N – Nrich (oil cake) ▪ Regulatory push from government- Market Development Assistance ▪ Push towards waste treatment & management Bio/Microbial & P – Phosgold Organic Fertiliser (Compost + Rock P) ▪ Soil Health Focus- Sustainable Agriculture ▪ Consumpt
Slide 37: Farm Mechanization: Eyeing the Future
Farm Mechanization: Eyeing the Future Mechanization across Ag Value Chain Coromandel’s Presence Soil & seed bed preparation 40% ▪ Market leadership in TN, AP, Kerala for Rice transplanters ▪ Introduced Combine harvester in FY18 Seeding & Planting 29% Paddy Transplanters ▪ Service centers in AP, Tela
Slide 38: Coromandel Key Financials
Coromandel Key Financials Total Income (INR Mil) EBIDTA (INR Mil) & EBIDTA % 1,32,616 1,17,003 1,10,485 16,0 00 12. 0% 1,02,499 14,0 00 11.1% 10.7% 9.6% 10. 0% 12,0 00 8.0 % 10,0 00 8,00 0 6.7% 6.0 % 14,200 6,00 0 12,263 9,820 4.0 % 4,00 0 7,896 2.0 % 2,00 0 - 0.0 % FY16 FY17 FY18 FY19 FY16 FY17 FY1
Slide 39: Coromandel Financials- P&L
Coromandel Financials- P&L In Rs Mio FY 2016* FY 2017 FY 2018 FY2019 CAGR Revenue 1,17,003 1,02,499 1,10,485 1,32,616 4% YoY (Growth) (%) 3% -12% 8% 20% EBITDA 7,896 9,820 12,263 14,200 22% YoY (Growth) (%) -7% 24% 25% 16% PBT after exceptional item 5,291 7,123 10,088 10,926 27% PAT 3,574 4,770 6,63
Slide 40: Doing it Responsibly
Doing it Responsibly ▪ Established a Bird’s Paradise at Kakinada plant (home to 100+ species): Covered by Bird’s Paradise, Kakinada Discovery channel & UNDP ▪ Green Visaka: Coverage under Green Belt: ~10000 new planting every year ▪ Conversion of Phospho gypsum heaps into Green belt at Vizag Girl Ch
Slide 41: Impact: 4,99,629 Beneficiaries (2018-19)
Impact: 4,99,629 Beneficiaries (2018-19) 7297 got benefited 16363 children impacted 1038 girls benefited through 73268 medical services through medical camps scholarships through 4 centers 2688 benefited 4485 benefitted Government general 469 women & 2161 youth through sports through construction of
Slide 42: Disclaimer
Disclaimer This presentation contains forward-looking statements which may be identified by their use of words contains “plans,” “expects,” “will,” “anticipates,” “believes,” “intends,” “projects,” “estimates” or other words of similar meaning. All statements that address expectations or projections
Slide 43: Thank You
Thank You Thank You
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