Slide 1: Q3 FY16 – Investor Presentation
An Group Company Q3 FY16 – Investor Presentation February 12th, 2016
Slide 2: Disclaimer
Disclaimer This presentation may include statements which may constitute forward-looking statements. All statements that address expectations or projections about the future, including, but not limited to, statements about the strategy for growth, business development, market position, expenditures,
Slide 3: Table of Contents
Table of Contents Section 1: RPG Group Overview 5-6 Section 2: Key Highlights 8 Section 3: Industry Overview 10-11 Section 4: Business Overview 13-26 Section 5: Operational & Financial Overview 28-38
Slide 4: Section 1: RPG Group Overview
Section 1: RPG Group Overview
Slide 5: RPG Group: Powered by Passion, Driven by Ethics
RPG Group: Powered by Passion, Driven by Ethics RPG Enterprises was founded in 1979 by Shri Rama Prasad Goenka, popularly known as RP Goenka, a pioneering fifth generation business leader from the Goenka family. The Goenkas have a history of business dating back to 1820 AD in banking, textiles, jute
Slide 6: RPG Group: Key Financials
RPG Group: Key Financials Net Revenue (Rs Cr) EBITDA (Rs Cr) PAT (Rs Cr) 18,593 17,614 FY11-15 CAGR: 14% 15,788 FY11-15 CAGR: 1,690 1,732 13,944 EBITDA 16% PAT 17% 1,250 10,839 1,121 943 714 795 423 429 404 FY11 FY12 FY13 FY14 FY15 FY11 FY12 FY13 FY14 FY15 Net Worth (Rs Cr) ROCE ROE 16,000 4,699 Mar
Slide 7: Section 2: Key Highlights
Section Section 2: 2: Key Key Highlights Highlights
Slide 8: Key Highlights
Key Highlights Revenue CAGR of 15% over last 5 years Average ROE of 17% for 5 years and 22% and 8% over last 3 years for 3 years ~25% of the additional capacity to commence operation in FY16 and Profit after Tax CAGR of 14% over last 5 expected to be fully ramped up over 18 years and 160% over last
Slide 9: Section 3: Industry Overview
Section 3: Industry Overview
Slide 10: Indian Tyre Industry Overview
Indian Tyre Industry Overview Tyre Industry turnover in India is Rs 50,000 crore Truck & Bus segment accounts for 55% of the industry’s revenues India exports Rs 10,500 crore worth of Tyres Most of the investments by Indian and MNC tyre majors are geared towards Truck & Bus Radial Tyres Glob
Slide 11: Indian Tyre Industry Overview
Indian Tyre Industry Overview Total Tyre Production (Volumes in Lakhs) MHCV (T&B) 165 165 171 157 161 84 FY 11 FY 12 FY 13 FY 14 FY 15 H1 FY 16 Passenger Car / Jeep 2 / 3 wheeler 357 760 321 317 671 633 634 277 287 591 190 396 FY 11 FY 12 FY 13 FY 14 FY 15 H1 FY 16 FY 11 FY 12 FY 13 FY 14 FY 15 H1 F
Slide 12: Section 4: Business Overview
Section Section4:4:Business BusinessOverview Overview
Slide 13: Board of Directors
Board of Directors Harsh Vardhan Goenka Anant Vardhan Goenka Arnab Banerjee Chairman, Non Executive Director Managing Director Whole -Time Director Atul C. Choksey Haigreve Khaitan Hari L. Mundra Kantikumar R. Podar Mahesh S. Gupta Non Executive Non Executive Non Executive Non Non Executive Non Exec
Slide 14: Leadership Team
Leadership Team Anant Goenka Manoj Jaiswal Arnab Banerjee Tom Thomas Managing Director Chief Financial Officer Executive Director Executive Director - Operations - Technology & Products Dilip Modak Chandrashekhar Ajgaonkar Debi Prasad Das Subbiah Kumar Senior Vice President Senior Vice President Sen
Slide 15: Overview
Overview India’s leading tyre company with over 50 yrs of presence Distribution Network : 3500+ dealers, 330+ exclusive CEAT franchisees 6 Manufacturing facilities - Bhandup, Nasik, Halol, Nagpur, Ambernath & Sri Lanka 100+ countries where products are sold with strong brand recall #No 1 player in S
Slide 16: Manufacturing Facilities
Manufacturing Facilities Overall Capacity: > 900 MT / day Bangladesh Halol Nagpur Nasik Bhandup Operational facilities Ambernath Hyderabad WIP Key Outsourcing facilities Calicut Manufacturing facility planned Sri Lanka 16
Slide 17: Strategic Drivers
Strategic Drivers 1 Strong Brand Recall Two wheelers Domestic Passenger cars & Utility Market vehicles 2 OEM Relationships 3 Distribution Network Profitable growth 4 Product Development International Specialty Market 5 Proven Model In Sri Lanka Emerging markets 6 Product Mix 17
Slide 18: Creating Strong Brand Equity
1 Creating Strong Brand Equity 18
Slide 19: Increasing OEM Presence
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Slide 20: Pan India Distribution Network
3 Pan India Distribution Network No. of CEAT Shoppes Distribution Network 208 3500+ dealers 176 102 330+ CEAT Franchisees (Shoppes + Hubs) 250+ two-wheeler distributors FY12 FY15 Dec'15 District coverage 464 212 FY12 FY15 20
Slide 21: Pan India Distribution Network
3 Pan India Distribution Network Multi Brand Outlet (MBO) Shop in Shop (SIS) New distribution model Developed MBO / SIS model in the last 2 years Over 275 outlets so far 21
Slide 22: Research & Development
4 Research & Development Recent Product Launches in FY16 PCR / UVR launches 2 wheeler launches Mahindra TUV 300: Launched in India with CEAT Tyres Fuel Smarrt CZAR Sport GRIPP XL ZOOM PLUS Pro Gripp Raid de Himalaya 2015 : SCOOTER Riding on newly launched Pro Gripp tyre & won Renault Kwid: event Lau
Slide 23: Emerging Markets Trends
5 Emerging Markets Trends Revenue EBITDA1 (SLR mn) & EBITDA Margin (%) (SLR mn) 12% 17% 20% 23% 26% 4,890 4,729 1,085 4,357 4,553 978 901 3,437 759 532 Sri Lanka FY12 FY13 FY14 FY15 YTD 16 FY12 FY13 FY14 FY15 YTD 16 50% JV with Kelani Tyres Ltd Strong presence in the truck, light truck, 2 / 3 wh
Slide 24: Passenger Segment Trends
6 Passenger Segment Trends 2/3 wheelers (Rs Cr) 1,259 PC / UV (Rs Cr) 567 1,094 476 457 899 376 Revenue 639 284 525 363 146 FY 11 FY 12 FY13 FY 14 FY 15 YTD 16 FY 11 FY 12 FY13 FY 14 FY 15 YTD 16 2x expansion in 2/3 wheeler and 2.5x expansion in PCR / UCR segment from the existing Expanding capaci
Slide 25: Specialty
6 Specialty Status Update CEAT has transferred Ambernath land to CSTL in Q3 FY16 which will be used to build a new OTR (off-the- road) radial plant CSTL will invest Rs 330 Crores for an initial capacity of 40 MT/day CEAT has infused Rs 25 Crores as an equity investment in CSTL in Q3 FY16 Pro
Slide 26: Outcome
Outcome 5 yr CAGR % 15% Sales (Rs Cr) 2,850 5,508 5,705 4,230 “Strategic Focus Areas” Passenger Segment, 20% 31% Specialty Exports & 32% Emerging Markets 38% 42% Higher margin business Contributes 42% sales for YTD 80% 16 compared to 20% in FY10 Others 68% 62% 58% Higher CAGR of 31% FY 10 FY14
Slide 27: Section 5: Operational & Financial Overview
Section Section5:5:Operational Operational&&Financial Financial Overview Overview
Slide 28: Q3 FY16 Operational Highlights
Q3 FY16 Operational Highlights Mahindra Imperio launched Honda NAVI in India with launched on CEAT Tyres CEAT CEAT started catering to Hero Maestro Edge and Hero Duet Royal Enfield HIMALAYAN launched on CEAT 28
Slide 29: Q3 FY16 Operational Highlights
Q3 FY16 Operational Highlights Rohit Sharma – Pirelli tie-up with CEAT for distribution of its Bat endorsement deal premium motorcycles tyres 29
Slide 30: Consolidated: Financial Trends
Consolidated: Financial Trends Revenue growth 5,508 5,705 5,009 4,614 4,230 3,602 Net Sales (Rs Cr) FY 11 FY 12 FY 13 FY 14 FY15 YTD FY16 14.8% 11.9% Margin trends 11.9% 658 680 627 EBITDA (Rs Cr) 8.7% 5.9% 438 4.6% EBITDA to Net 274 Sales % 165 FY 11 FY 12 FY 13 FY 14 FY15 YTD FY16 Note EBITDA incl
Slide 31: Consolidated: Financial Trends
Consolidated: Financial Trends 342 PAT trends 317 271 8.1% PAT (Rs Cr) 5.6% 4.9% PAT to Net Sales% 120 0.7% 0.4% 2.4% 26 18 FY 11 FY 12 FY 13 FY 14 FY15 YTD FY16 30% Return Ratios 25% 24% ROE (%) 16% 18% 17% ROCE post tax (%) 17% 8% 13% 7% 3% 4% FY 11 FY 12 FY 13 FY 14 FY15 TTM Note QIP proceeds con
Slide 32: Consolidated: Q3 FY16 Financial Highlights
Consolidated: Q3 FY16 Financial Highlights Q3 FY16 v/s Q3 FY15 (Y-o-Y) Q3FY16 v/s Q2FY16 (Q-o-Q) 6% Volume growth Flat volume growth EBITDA% up 1.6% at 14.7% EBITDA% up 0.3% Finance cost at Rs 19 cr compared Finance cost at Rs 19 cr compared to to Rs 31 cr (down by Rs 12 Cr) Rs 22 cr (do
Slide 33: Consolidated: Financials
Consolidated: Financials Rs cr Parameter Q3FY15 Q2FY16 Q3FY16 YTDFY15 YTDFY16 Net Sales 1,399 1,400 1,374 4,251 4,230 Growth (YoY) - - -1.8% - -0.5% Growth (QoQ) - - -1.9% - - EBITDA 183 202 202 496 627 Growth (YoY) - - 10.2% - 26.5% Growth (QoQ) - - -0.1% - - EBITDA (%) 13.1% 14.4% 14.7% 11.7% 14.8
Slide 34: Consolidated: Leverage / coverage Profile
Consolidated: Leverage / coverage Profile Total Debt 882 775 736 654 725 (Rs Cr) ST Debt (Rs Cr) Debt breakup 0.5 0.5 0.4 535 0.3 0.4 LT Debt (Rs Cr) 421 398 213 254 512 346 354 400 Total Debt / Equity 338 Q3 FY 15 Q4 FY 15 Q1 FY 16 Q2 FY 16 Q3 FY 16 10.5 9.2 EBITDA (Rs Cr) 223 Leverage ratios 202 2
Slide 35: Standalone: Q3 FY16 YoY Results
Standalone: Q3 FY16 YoY Results Rs Cr Parameter Q3FY15 Q3FY16 YoY Net Sales 1,344 1,321 -1.7% Raw Material 815 734 -9.9% Gross margin 529 587 10.9% Gross margin % 39.4% 44.4% 500 bps Employee 90 91 1.6% Other Expenses 280 306 9.4% EBITDA* 171 197 15.4% EBITDA % 12.7% 14.9% 220 bps Finance Cost 31 19
Slide 36: Standalone: Q3 FY16 QoQ Results
Standalone: Q3 FY16 QoQ Results Rs Cr Parameter Q2FY16 Q3FY16 QoQ Net Sales 1,348 1,321 -2.0% Raw Material 759 734 -3.3% Gross margin 589 587 -0.4% Gross margin % 43.7% 44.4% 70 bps Employee 92 91 -0.7% Other Expenses 315 306 -3.0% EBITDA* 191 197 3.2% EBITDA % 14.2% 14.9% 70 bps Finance Cost 22 19
Slide 37: Sri Lanka: Q3 FY16 Analysis
Sri Lanka: Q3 FY16 Analysis Rs cr Parameter Q3FY15 Q2FY16 Q3FY16 QoQ YoY Net Sales 114 109 112 2.2% -1.9% EBIDTA 28 29 28 -1.7% 1.8% Finance Cost 0 0 0 -61.6% -78.4% Depreciation 3 3 3 -4.4% -1.5% Operating PBT 25 26 26 -1.1% 2.9% PBT 26 27 27 0.4% 5.7% PAT 21 18 25 36.8% 18.8% EBITDA % 24.5% 26.4%
Slide 38: Equity Shareholding & Price trends
Equity Shareholding & Price trends 1,350.0 Close Price Total Volume 4,000,000 1,200.0 3,500,000 1,050.0 3,000,000 Returns since Jan’ 15 900.0 750.0 2,500,000 CEAT: 3% 2,000,000 600.0 450.0 1,500,000 Sensex: -16% 1,000,000 300.0 150.0 500,000 0.0 - Dec/14 Feb/15 Apr/15 Jun/15 Aug/15 Oct/15 Dec/15
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