Zydus Wellness Limited · NSE:ZYDUSWELL
Zydus Wellness — Q3 FY23 Earnings Presentation
27 slides from Zydus Wellness's earnings presentation, Feb 2, 2023
Slide 1: Exchange filing cover letter for investor presentation
February 2, 2023 Listing Department Code: 531 335 BSE LIMITED P J Towers, Dalal Street, Fort, Mumbai–400 001 Listing Department Code: ZYDUSWELL NATIONAL STOCK EXCHANGE OF INDIA LIMITED Exchange Plaza, Bandra Kurla Complex, Bandra (E), Mumbai–400 051 Re: Investor Presentation Dear Sir / Madam, Please
Slide 2: Q3 FY23 Earnings Presentation
Q3 FY23 Earnings Presentation February 02, 2023
Slide 3: Safe Harbour Statement
Safe Harbour Statement This presentation contains certain forward-looking statements including those describing Zydus Wellness’s strategies, strategic direction, objectives, future prospects, estimates etc. Investors are cautioned that “forward looking statements” are based on certain expectations,
Slide 4: Agenda
Agenda Operating environment- Overview Zydus Wellness: Financial performance – Q3FY23 A leading Consumer Wellness Brand Highlights Company in India The Road Ahead 3
Slide 5: Operating Environment - Overview & Financial Performance
Operating Environment - Overview & Financial Performance
Slide 6: Operating environment sees slight improvement yet demand remains challenging
Operating environment sees slight improvement yet demand remains challenging…. 01 02 Zydus Wellness performed in line High Inflation Constrained with the FMCG sector Budgets 8% Rural consumers downtrading Retail inflation stayed at to minimize the impact of 7% elevated levels inflation in their hous
Slide 7: Inflation cooling down for some key inputs
Inflation cooling down for some key inputs Milk RPO* DMH** +33% vs Q3 FY20 +32% vs Q3 FY20 +16% vs Q3 FY20 +26% vs Q3 FY22 -20% vs Q3 FY22 +19% vs Q3 FY22 Q3FY20 Q3FY22 Q2FY23 Q3FY23 Q3FY20 Q3FY22 Q2FY23 Q3FY23 Q3FY20 Q3FY22 Q2FY23 Q3FY23 ❑ Weakening of INR/USD Aspartame Diesel ❑ Calibrated price in
Slide 8: Q3FY23 - Seasonally low-value quarter
Q3FY23 - Seasonally low-value quarter January to June accounts for ~60% / 80% of annual Revenue / Initiatives to mitigate seasonality over EBITDA the long term Brand campaigns driving daily relevance of category Revenue Relaunch of Glucon-D brand strengthening the “Energy” credential: Transitioning
Slide 9: Q3 FY23 - Financial Performance
Q3 FY23 - Financial Performance Revenue Rs 4,130 mn Revenue growth in line with the FMCG industry growth for the quarter, largely driven by value +7.3% YoY | +8.2% 3Y CAGR Inflation cooling down across key inputs except milk and Rs 1,823 mn Gross Margin -2.7% YoY | +1.8% 3Y CAGR appropriate actions
Slide 10: Brand Highlights
Brand Highlights Waliness
Slide 11: Strengthening Brand leadership and demonstrating pricing power
Strengthening Brand leadership and demonstrating pricing power Continued to gain market share in Glucon-D, Everyuth Scrub and Peel-off, Nycil Complan market share loss moderated Glucose Sugar Blended Prickly heat *Facial Fat Category HFD Scrub Peel-off Dairy Powder substitute Sugar powder cleansing
Slide 12: Leaders in 5 out of 6 categories
Leaders in 5 out of 6 categories Strengthen “Energy” credential with new launches Strengthening core through Relaunch of the Brand • Category leading brand with 99% plus brand recall • Focused on scientifically proven claims on memory and • ~60% market share in the category concentration and enhance
Slide 13: Quarterly Brand Performance- HFD and Glucose Powder
Quarterly Brand Performance- HFD and Glucose Powder Strengthening core through Relaunch of the Strengthen “Energy” credential with new Brand launches ❖Mid single digit YoY growth in the quarter and moderating ❖Being a non-seasonal quarter the brand had limited contribution market share loss despite
Slide 14: Quarterly Brand Performance– Everyuth and Nycil
Quarterly Brand Performance– Everyuth and Nycil Growing Faster than Market Seasonally low value quarter ❖Continued consistent performance delivering good double digit ❖Being a non-seasonal quarter the brand has limited contribution sales growth on a 3 year CAGR basis and building market shares to th
Slide 15: Quarterly Brand Performance– Nutralite, SugarLite and SugarFree
Quarterly Brand Performance– Nutralite, SugarLite and SugarFree Strong growth across the range of products Offtake turnaround continues to get stronger ❖Sugar Free witnessed a revival with double digit offtakes growth ❖Double-digit growth in the quarter with 3Y CAGR remaining at indicating a turnaro
Slide 16: Campaigns during the quarter (1/3)
Campaigns during the quarter (1/3) 15
Slide 17: Campaigns and Launches during the quarter (2/3)
Campaigns and Launches during the quarter (2/3) Launch of new packaging Print Campaign for Doodhshakti Butter Spread 500g Tub for DoodhShakti Butter Prof. Ghee now in Ceka Pack as well 16
Slide 18: Campaigns during the quarter (3/3)
Campaigns during the quarter (3/3) Build Awareness through Print & Branding Influencers to drive WOM & Recommendation In school activation to engage kids METRO Branding at key Integrating Sugarlite along Front Page AD’s consumer touchpoints with recipes made by Supplementary Chefs & Digital Mother S
Slide 19: The Road Ahead
The Road Ahead was.
Slide 20: Three Pillars to drive growth – staying on course
Three Pillars to drive growth – staying on course Accelerate Growth of Build International Presence Significantly Grow Scale Core Brands Innovations to focus on portfolio Build scale in international Open to bolt-on acquisitions diversification and expansion business by focusing on SAARC, at the rig
Slide 21: The building blocks
The building blocks Category Building Leading Route to Market Digital backbone to decision Inorganic play for gap Volume led focus Plan to enhance distribution infra making filling Recruit new consumers to 3Mn+ reach and 1 Mn direct Digitizing the whole value chain – Proactively look for Bolt-on cov
Slide 22: Building Route to market to adapt shifting channel mix
Building Route to market to adapt shifting channel mix • Channel mix shift towards • Implementing Integrated Business MT+Ecom from 17.6% (YTD FY22) • Direct reach ~6 lakh stores Planning (IBP) tool to automate to 20.3% (YTD FY23). Potential to expansion across sub channels the demand planning, suppl
Slide 23: Multiple levers to build leaner and efficient organization – Transformation 2.0
Multiple levers to build leaner and efficient organization – Transformation 2.0 Building an Efficient Supply Chain Reorganizing Manufacturing Operations Revisited manufacturing footprint focusing on redistributing the Digitalization for better demand and manufacturing of same product in different ge
Slide 24: Appendix
: Zydus Appendix Wéliness
Slide 25: Financials Summary – Q3FY23
Financials Summary – Q3FY23 INR Million 3Q FY22 3Q FY23 YoY Growth 3Y CAGR Net Sales 3,849 4,130 7.3% 8.2% Total Operating Income 3,881 4,156 7.1% 7.7% Gross Contribution 1874 1,823 -2.7% 1.8% Gross Contribution Margin- (% of net sales) 47.9% 43.5% -433bps HR Cost 382 351 -8.1% -1.9% Advertisement E
Slide 26: Financials Summary – 9MFY23
Financials Summary – 9MFY23 INR Million 9M FY22 9M FY23 YoY Growth 3Y CAGR Net Sales 13,533 15,327 13.3% 7.0% Total Operating Income 13,693 15,418 12.6% 6.4% Gross Contribution 7,034 7,465 6.1% 1.0% Gross Contribution Margin-(% of net sales) 50.8% 48.1% -268bps HR Cost 1,235 1,238 0.3% 2.9% Advertis
Slide 27: Zydus Wellness Limited
Zydus Wellness Limited Regd. Office: Zydus Corporate Park, Scheme No. 63, Survey No. 536, Khoraj (Gandhinagar), Nr. Vaishnodevi Circle, S. G. Highway, Ahmedabad – 382481, India. CIN: L15201GJ1994PLC023490 +91-79-71800000 www.zyduswellness.com Zydus Wellness, Oct 21, 2022 26