Everest Kanto Cylinder Limited · NSE:EKC
Everest Kanto Cylinder — Q3 FY22 Earnings Presentation
37 slides from Everest Kanto Cylinder's earnings presentation, Feb 16, 2022
Slide 1: Regulation 30 disclosure cover letter to stock exchanges
February 16, 2022 To, BSE LIMITED National Stock Exchange of India P.J. Towers, Ltd. Dalal Street, Exchange Plaza, EVEREST Mumbai - 400 001 Bandra Kurla Complex, KANTO Bandra (East), Mumbai - 400051 BSE Scrip Code: 532684 cae CYLINDER LIMITED NSE Series: EQ Manufacturers Dear Sir(s), of High Pressur
Slide 2: Q3 FY22 Financial Results
Q3 FY22 Financial Results February 2022
Slide 3: Safe Harbor
Safe Harbor Certain statements in this communication may be ‘forward looking statements’ within the meaning of applicable laws and regulations. These forward-looking statements involve several risks, uncertainties and other factors that could cause actual results to differ materially from those sugg
Slide 4: India's Largest Manufacturer of High-pressure Gas Cylinders
E K C i s I n d i a ’s L a r g e s t M a n u f a c t u r e r o f H i g h - p r e s s u r e Gas Cylinders Since 1978 Established Market Position 200+ SKU’s 25+ Countries 150+ Clients Fungible production lines with diverse Cater to gas ecosystems across India, Europe, USA, Auto OEM’s, City Gas Distrib
Slide 5: Table of Contents
Ta b l e o f Contents Q3 FY22 Financial Performance 5 Industry Overview 11 Company Overview 19 Historical Financials/Corporate Summary 30 4
Slide 6: Q3 FY22 Financial Performance
Q3 FY22 Financial Performance
Slide 7: Key Performance Highlights – Q3 FY22
Key Performance Highlights – Q3 FY22 Consolidated Revenues EBITDA Margin up Profit Before Tax up EPS up from up 88% from 20.1 to 21.0% 143% Rs. 4.55 to Rs. 5.36 Significant increase in India business up 74% UAE business up 129% USA business up 172% profits across all to Rs. 348 crore to Rs. 65 crore
Slide 8: Key Performance Highlights – 9M FY22
Key Performance Highlights – 9M FY22 Consolidated Revenues EBITDA Margin up Profit Before Tax up EPS up from up 84% from 19.3% to 24.4% 221% Rs. 7.8 to Rs. 17.8 Debt to Equity reduced India business up 73% UAE business up 131% USA business up 105% from to Rs. 896 crore to Rs. 187 crore to Rs. 142 cr
Slide 9: Management Commentary
Management Commentary Comments on Q3 FY22 performance by Comments on Q3 FY22 performance by Pushkar Khurana, Chairman, Puneet Khurana, Managing Director, Everest Kanto Cylinder Limited Everest Kanto Cylinder Limited The gas economy continues to expand rapidly across the world We have delivered stron
Slide 10: Quarterly Overview – Q3 FY22 vs Q3 FY21
Quarterly Overview – Q3 FY22 vs Q3 FY21 Revenues EBITDA PBT* PAT ** Consolidated Rs. 463.9 Cr Rs. 97.3 Cr Rs. 87.4 Cr Rs. 60.1 Cr 87.8% 95.9% 143.2% 17.7% Standalone Rs. 348.1 Cr Rs. 79.7 Cr Rs. 73.9 Cr Rs. 49.3 Cr 73.8% 66.1% 86.7% 60.7% Strong growth across regions. EBITDA margin expanded PB
Slide 11: Geographical Revenue/Margins Breakup – Q3 FY22
Geographical Revenue/Margins Breakup – Q3 FY22 India UAE USA & Hungary 348 65 52 200 Revenue 29 19 Q3 FY22 Q3 FY21 Q3 FY22 Q3 FY21 Q3 FY22 Q3 FY21 74% 70% 172% 74 12 2 12 62 EBIT -5 Q3 FY22 Q3 FY21 Q3 FY22 Q3 FY21 Q3 FY22 Q3 FY21 20% 6% N.A. 10
Slide 12: Industry Overview
Industry Overview EVEREST KANTO CYLINDER LIMITED @ Se mpany Clean Energy S
Slide 13: India's Expanding Gas Economy
I n d i a ’s E x p a n d i n g G a s E c o n o m y Gas contribution to India’s primary energy mix Driven by an expanding city gas distribution network to increase from 11% in 2010 to 20% in 2030 Natural Gas Demand Outlook (mmscmd) CGD Demand (mmscmd) Industrial Demand (mmscmd) 85.61 746.03 63.91 516
Slide 14: CNG Ecosystem Continues to Proliferate
CNG Ecosystem Continues to Proliferate Visibility of country-wide coverage Geographical Areas Population Coverage Area Coverage Previous expansions 92 20% 11% 430 bids received for 65 GA’s in Round 11 Round 9 auctions (Apr’18) 86 26% 24% Aggregate investments committed – Round 10 auctions (Nov’1
Slide 15: Increasing Gas Adoption is Clearly Visible
I n c r e a s i n g G a s A d o p t i o n i s C l e a r l y Vi s i b l e Domestic International India Committed To Achieve 15% PNGRB receives 430 bids in 11th city Global CNG and LPG Vehicle Market Share Of Natural Gas In Primary gas distribution round Report 2021: Focus on Passenger Cars, This roun
Slide 16: CNG Demand has Multiple Drivers
CNG Demand has Multiple Drivers Auto OEMs have significantly reduced diesel vehicle BS-VI transition production due to rising costs/lower demand Vehicle Scrappage Expected to drive new vehicle sales and CNG adoption Policy Conversion of STCs continue to convert diesel bus fleets to CNG diesel buses
Slide 17: Revival in Economic Growth to Drive Industrial Demand
Revival in Economic Growth to Drive Industrial Demand Industrial Demand is driven by capex activity, expected to accelerate resume growth after the recent weakness Gross Fixed Capital Formation GVA from Industrial Sector (Current Prices) CAGR: 11.6% CAGR: -1.5% CAGR: 9.3% CAGR: -3.8% 58.5 36.3 35.5
Slide 18: Industrial Demand Drivers
Industrial Demand Drivers Fire Equipment and Fire Suppression Systems The global fire safety equipment market is estimated at $ 58 billion in 2018 – and expected to expand at CAGR of 8.8% from 2019 to 2025 Demand for advanced fire safety systems is expected to be driven by industries such as man
Slide 19: Industrial Demand Drivers
Industrial Demand Drivers Aerospace and Defense The Global Aerospace and Defence Industry has been growing on the back of rising commercial aircraft production and strong defence spending Aerospace demand is focused on next-generation, fuel-efficient aircraft with order backlog continuing to ris
Slide 20: Company Overview
Company Overview EVEREST KANTO CYLINDER LIMITED mpany
Slide 21: Over Four Decades of Focused Domain Experience
Over Four Decades of Focused Domain Experience - Received RMB 93.50 million against sale of China subsidiary - Announced 400,000- cylinder brownfield expansion Set up - EKC Intl FZE, Dubai marketing/product Sold Gandhidham entered JV for development unit, assets Production unit in Initiated subsidia
Slide 22: Board of Directors
Board of Directors Executive Chairman Managing Director Independent Director Joined EKC business in 1994 Joined EKC business in 1996 Finance, Banking and Law professional Commerce graduate from Mumbai University MBA (International Business) from EU Specializes in audit, taxation, financi
Slide 23: Extensive Range of Products
Extensive Range of Products CNG Steel Cylinders Industrial Cylinders Wide range of CNG cylinders designed and Wide range of industrial cylinders designed for manufactured to comply with the highest quality industrial gases, medical and food & beverage and safety standards applications Products
Slide 24: Products with a Wide Range of Applications
P r o d u c t s w i t h a Wi d e R a n g e o f A p p l i c a t i o n s Fire Extinguisher Body Breathing Air Cylinders Cylinders for storage of carbon dioxide – used in fire extinguishers, rubber rafts and aerated water Compressed breathing air cylinders adhering Range covers capacities of 1 li
Slide 25: High Value Addition in the Manufacturing Process
H i g h Va l u e A d d i t i o n i n t h e M a n u f a c t u r i n g Process Seamless Heat Hardness Painting Tubes Treatment Checking Neck Neck Final Tube Cutting Stamping Product Drilling Threading Inside Neck Ultrasonic Int. & Ext. Bottom Forming Testing Shot Blasting Milling Hydro Bottom Bottom A
Slide 26: Quality is Key in a Highly Regulated, Safety-focused Industry
Quality is Key in a Highly Regulated, Safety - focused Industry India USA UAE ISO 9001:2015 Certificate from Bureau Veritas for High Pressure seamless steel gas cylinders of 20 to 300 litres water capacity for Industrial and CNG on-board vehicle application, cylinder cascades etc American Society fo
Slide 27: Global-size Manufacturing Plants with Fungible Capacities
Global-size Manufacturing Plants with Fungible Capacities Tarapur, Maharashtra, India Kandla SEZ, Gujarat, India Wide range of high-pressure seamless Small cylinders (1 litre to 21 litres), gas Manufacturing steel cylinders with storage capacity up to Manufacturing cylinders (up to 280 liters), jumb
Slide 28: Manufacturing Facilities – Overseas
Manufacturing Facilities – Overseas Plant I – Dubai Plant II – Dubai Pittsburgh, PA, USA Jumbo tubes/skids as per DOT, ASME, Focus on global emerging markets from two Manufacturing Manufacturing international standards, full carbon type 4 facilities located in Jabel Ali FTZ composite cylinders Plant
Slide 29: Planned Capacity Expansions
Planned Capacity Expansions Revenue Location Capacity Addition Capex Funding Sources Completion Timeline Additional Details Potential Brownfield expansion – De-bottlenecking and expansion initiatives have Tarapur, Maharashtra / 400,000 cylinders annually Phase I: Completed already improved output
Slide 30: International Operations Target Widespread Global Gas Usage Expansion
I n t e r n a t i o n a l O p e r a t i o n s Ta r g e t Wi d e s p r e a d Global Gas Usage Expansion USA Europe UAE Leader in innovation, producing large, seamless Signed JV with Rev Gas Industries Ltd, Hungary to Deals in CNG cylinders, industrial cylinders, cascades, pressure vessels set u
Slide 31: Historical Financials/Corporate Summary
Historical Financials/ Corporate Summary
Slide 32: Financial Summary
Financial Summary Revenue* (Rs. Cr) 1220.2 949.1 702.1 760.5 542.5 FY18 FY19 FY20 FY21 9M FY22 India UAE USA & Hungary 897.0 187.3 751.0 149.1 136 141.8 115.0 132.0 117.9 127.3 462.0 501.6 89.0 333.4 60.2 FY18 FY19 FY20 FY21 9M FY22 FY18 FY19 FY20 FY21 9M FY22 FY18 FY19 FY20 FY21 9M FY22 53.9% 48.2%
Slide 33: Abridged Balance Sheet (Consolidated)
Abridged Balance Sheet (Consolidated) Assets (Rs. Cr)* 2018 2019 2020 2021 9M FY22 Liabilities (Rs. Cr)* 2018 2019 2020 2021 9M FY22 Fixed Assets 48.9 347.6 364.9 358.9 371.0 Shareholder Funds 444.2 517.8 537.7 628.3 831.9 Other Non-Current Assets 17.5 8.5 22.5 51.2 52.0 Long - Term Debt 206.1 155.3
Slide 34: Ratio
Ratio Debt/Equity Debt/EBITDA ROCE (%) 4.5 0.8 31.7 3.3 0.6 2.7 0.5 16.9 0.2 0.2 0.8 7.5 6.6 0.4 5.8 FY18 FY19 FY20 FY21 TTM 9M FY18 FY19 FY20 FY21 TTM 9M FY18 FY19 FY20 FY21 TTM 9M FY22 FY22 FY22 Interest Coverage Assets Turnover 21.1 1.7 1.5 1.4 1.1 0.8 6.3 1.7 2.4 2.0 FY18 FY19 FY20 FY21 TTM 9M F
Slide 35: Market leader in a sector with multiple, long-term growth drivers
Market leader in a sector with multiple, long - term growth drivers 5X expansion of CNG pumps infrastructure Almost complete population coverage in India by 2030 underway Expanding Auto OEM’s expanding CNG vehicle production Availability now extends across many more models Opportunity volumes Sustai
Slide 36: About Us
About Us Everest Kanto Cylinder Limited (EKC) (BSE: 532684, NSE: EKC), established in 1978, is a clean energy solutions company and a leading global manufacturer of seamless steel gas cylinders with over 20 million industrial gas and CNG cylinders currently in service. EKC operates two manufacturing
Slide 37: Thank You
Thank You
Everest Kanto Cylinder — Q3 FY22 Earnings Presentation on 6ix