Ttk Prestige Limited · NSE:TTKPRESTIG
Ttk Prestige — Investor Presentation (June 2016)
53 slides from Ttk Prestige's investor presentation, June 2016
Slide 1: Welcome to TTK
Welcome to TTK 72 Mill eras! © os - & tik
Slide 2: The TTK Group
The TTK Group Today a Rs22 Billion group • 30 product categories and Manufacturing services commenced in • 16 manufacturing 1950 units Started in 1928 as an • Pioneered several • 12000 employees indenting agency categories in India • Exports to every • Pressure cookers, continent • Founded by Mr. TT
Slide 3: Diversified Group Structure
Diversified Group Structure TTK Prestige Limited • Consumer durables - Listed UK Subsidiary of TTK Prestige Limited TTK TTKPrestige Limited British Holdings Limited - Consumer Durables - Unlisted Horwood Homewares Ltd • Pharmaceuticals, Medical devices , Consumer TTK Healthcare Limited products and
Slide 4: Mission of the group
Mission of the group To provide quality consumer products at affordable prices Core values of the group Trust, Transparency and Knowledge
Slide 5: TTK Prestige Limited
TTK Prestige Limited • Incorporated in 1955. Shareholding • Flagship company of TTK Group • India’s largest kitchenware company. • IPO in 1994. • 3000 strong human capital Public and • Till 2015 Two brands in the portfolio. Inst. 30% Prestige and Manttra. Now added Judge, Stellar & Horwood global br
Slide 6: Board of Directors/ Management
Board of Directors/ Management Promoter Directors • Mr. TT Jagannathan – Executive Chairman • Mr. TT Raghunathan – Vice Chairman • Dr. TT Mukund Professional Directors • Mr. Chandru Kalro– Managing Director &CEO • Mr. K. Shankaran – Director (Corporate Affairs) Independent Directors • Mr. R. Sriniva
Slide 7: Vision and Values
Vision and Values CORE VISION • A Prestige in every Indian Kitchen CORE VALUES • Quality products at affordable prices • Trust, Transparency, Knowledge and “Prestige” in whatever we do • Fair dealings with every stakeholder • Respect for Environment CORE STRATEGY • Providing Total Kitchen Solutions
Slide 8: The Journey So Far
THE JOURNEY SO FAR • 1955 – INCORPORATION • 1959 – FIRST MANUFATURING UNIT IN BANGALORE • 1981 – SECOND MFG UNIT IN HOSUR - TAMILNADU • TILL 1990 – A SINGLE PRODUCT COMPANY – JUST ALUMINUM OUTER LID PRESSURE COOKERS – DOMINANT IN SOUTHERN INDIA • 1990-94- LAUNCH OF SS PRESSURE COOKERS AND NON-STICK
Slide 9: The journey so far (continued)
……the journey so far • THIS PERIOD SAW THE LAUNCH OF STOVES AND APPLIANCES AND THE MAJOR MARKETING INITIATIVE OF EXCLUSIVE RETAIL NETWORK – PRESTIGE SMART KITCHENS • 2006 – LAUNCH OF WELL DIFFERENTIATED INNER LID PRESSURE COOKERS - NEW CAPACITIES IN UTHARKAND AND COIMBATORE • 2006- 2010 – TRANSFORMA
Slide 10: Product Categories Before 2001
PRODUCT CATEGORIES BEFORE 2001 Less than 100 SKUs
Slide 11: Product Categories Now
PRODUCT CATEGORIES NOW SEVERAL HUNDRED SKUs
Slide 12: Basic Philosophy that Led to Turnaround and Growth
BASIC PHILOSPHY THAT LEAD TO TURNAROUND AND GROWTH • FOCUS ON OCCUPYING THE MINDSHARE OF THE CONSUMER • FOCUS ON DOMINATING THE KITCHEN DOMAIN WITH DIFFERENTIATED PRODUCTS • FOCUS ON GROWTH , GAINING MARKET SHARE AND EXPANDING CUSTOMER BASE • KEY METRICS - GROWTH - CAPITAL EFFICIENCY - RETURN ON CAP
Slide 13: Fruits of the Journey
FRUITS OF THE JOURNEY WE DERISKED THE COMPANY FROM BEING DEPENDANT ON SINGLE PRODUCT AND SINGLE MARKET WE DERISKED THE MANUFACTURING AND SOURCING FROM BEING DEPENDENT ON A SINGLE LOCATION/ FEW SOURCES TODAY WE ARE OPERATING IN A MARKET SIZE OF RS. 120 BILLION AS COMPARED TO JUST RS.5 BILLION 1
Slide 14: Prestige Awards & Accolades
Prestige Awards & Acolades .-- - w_,_ A ardsof2012 A ChoMnbJ llM BRAND 2011-2012
Slide 15: Awards Received 2015-16
AWARDS RECEIVED 2015-16 Super Brand – 5th Time in a Row Master brand Award – 3rd Time in a Row Reader’s Digest Most Trusted Brand – 3rd Time in a Row Selected No.1 Brand in Kitchen Appliances Brand Excellence award in Kitchen Appliances India’s Most Trusted Brand in Kitchen Appliances Total Producti
Slide 16: Strengths of the company
Strengths of the company • 10 manufacturing • Within and outside units India • Excellent Product • Dedicated vendors development within India to capability implement our • Strengths in Deep designs draw of Aluminum and SS Manufacturing Sourcing Brand •Comprehensive Sales Marketing Quality and Market
Slide 17: The Prestige Brand
The Prestige Brand Core values of the brand Leaders in Pressure cookers, are TRUST, SAFETY, cookware, Induction Tops DURABILITY Prestige is a Superbrand • Pressure cookers Product • Metal spoon innovations friendly cookware • Duplex gas stoves Marketing innovations India’s Largest Kitchen appliance
Slide 18: The market for us
The market for us Small Appliances, Pressure cookers, Wet Grinders, 653 , 5% 1,310 , 11% 1,755 , 14% Non Stick cookware, 1,045 , 9% Chimneys, 1,037 , 9% Rice cookers, 532 , 4% Mixer Grinders, 2,662 , 22% Induction cooktops, Gas Stoves, 2,396 , 20% 780 , 6% A 12000 crore landscape
Slide 19: The Prestige product portfolio – widest in the industry
The Prestige product portfolio – widest in the industry Preparation before Kitchen cooking Food preparation supplements Kitchen Hardware Pressure Chopping cooking Heaters Chimneys Blending Cooking Toasting Store-ware Sautéing, Beverage Grinding frying etc makers Processing Baking Mixer grinders Pres
Slide 20: Distribution Structure
Distribution Structure Traditional Modern Trade Trade Own Retail Institutions Online Prestige Smart Direct Dealers Hypermarkets Kitchen Offline CSD Market Place and Online Authorized Re- distributors Super markets BPCL Direct Sell Shop in Shop HPCL Sub Dealers Corporate and Govt. Rural Inst
Slide 21: Distribution
Distribution Infrastructure and Reach Channel contributions Unique National Large sales structure presence force with multiple Institutions channels Own retail 4% 17% Own retail 28 branch 400 direct & locations 1000 indirect Modern format Traditional trade Traditional retail 58% Over 250,000 Product
Slide 22: Retail initiative
Retail initiative Key highlights Results of the Retail initiative Unique National Quick reach of new products pioneering effort presence •First kitchen appliance •534outlets brand •230 towns Brand is today seen in a new light. Show cases the brand in the intended and complete format for 365 days Hig
Slide 23: Innovation: the key to growth
INNOVATION THE KEY TO GROWTH AND TO MEET CHALLENGES SOME KEY INNOVATIONS • HANDI SHAPED PRESSURE COOKES • APPLE COOKERS WHICH WON DESIGNER AWARDS • CUSOTMISATION OF INDUCTION COOKTOPS FOR INDIAN MARKETS. • INDUCTION BASE ON A H.A. BODY
Slide 24: Microchef: a breakthrough innovation
MICROCHEF A BREAKTHROUGH INNOVATION • MICROWAVE COMPATIBLE PRESSURE COOKER • INNOVATED AND DEVELOPED IN-HOUSE • GLOBAL PATENT IN PROCESS • RENDERS MICROWAVE COOKING MORE HEALTHY AND EFFICIENT • RENDERS MICROWAVE USE MORE VERSATILE • A GROWTH DRIVER FOR EXPORT MARKET • WELL RECEIVED IN EUROPE DURING
Slide 25: Innovations in Traditional Products
INNOVATIONS IN TRADITIONAL PRODUCTS Nakshatra Cute Silky Red Duo Silky Red Aluminium O/L HA Multi Kadai
Slide 26: New Product Innovations - Appliances
NEW PRODUCT INNOVATIONS-APPLIANCES Teon 3 jar, Teon 4 Jar Roti Maker Induction 3.0 V3
Slide 27: Factors that Lead to Growth and Sustainability
FACTORS THAT LEAD TO GROWTH AND SUSTAINABILITY General economic factors •Economy was growing between 8-9% for a period of about 6 to 7 years till 2010-11.Consistent increase in number of middle income groups •Rural employment guarantee scheme •Growing disposable income in the hands of consumer Consu
Slide 28: Factors Leading to Growth and Sustainability
FACTORS LEADING TO GROWTH AND SUSTAINABILITY………. TTK Prestige’s role Driving growth through Innovation Close contact with consumer Offering innovated and differentiated products ahead of competition Offering of wide range and total kitchen solutions Expanding distribution – width, depth an
Slide 29: Financials
iene FINANCIALS tk
Slide 30: Sales Trend (Rs. Millions)
SALES TREND (Rs. Millions) 17000 15588 15000 14214 13859 13000 13234 11000 11227 9000 7756 7000 5000 5168 4162 3398 3000 2933 2318 1894 1461 1000 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16
Slide 31: Sales by product category
35000 Rs.Milllion 30000 25000 15588.2 14214.2 13858.9 20000 13234 Total OTHERS 11227.6 APPLIANCES 590.1 COOKWARE 15000 560.1 COOKERS 470.7 385 7755.8 6679.8 299 5734.9 5833.3 10000 5643.1 4549.6 5167.5 218.9 2627.9 2752.3 4161.6 2828 2448.5 2265.8 5000 3398.5 172.3 2246.9 2932.7 163 1716.1 1539.9 15
Slide 32: EBIDTA Trend from 2006-07
2500.0 EBIDTA TREND FROM 2006-07 (RS. MILLION) 2084.5 2000.0 1920.7 1759.2 1681.0 1543.4 1500.0 1259.6 1000.0 761.6 500.0 381.3 327.7 257.9 0.0 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16
Slide 33: Performance for the Year Ending 31st March 2016
PERFORMANCE For the Year Ending 31st March 2016 (Rs. Million) 15-16 14-15 Sales 15588.2 14214.2 Other Income 96.0 51.0 EBIDTA BEFORE EXCEPTIONAL ITEMS 1920.7 1543.4 PROFIT BEFORE TAX 1655.7 1333.0 PROFIT AFTER TAX 1148.2 923.2 EBIDTA Before Exceptiona Items/SALES % 12.32 10.86
Slide 34: Performance for Quarter Ending 31st March 2016
PERFORMANCE For Quarter Ending 31st March 2016 (Rs. Million) 15-16 14-15 Sales 3144.8 2929.8 Other Income 29.8 10.3 EBIDTA BEFORE EXCEPTIONAL ITEMS 367.3 194.0 PROFIT BEFORE TAX 302.8 140.7 PROFIT AFTER TAX 216.2 97.6 EBIDTA/SALES % BEFORE EXCEPTIONAL ITEMS 11.68 6.62
Slide 35: Key Facts Relating to FY 2015-16
KEY FACTS RELATING TO FY 2015-16 • General Economy continued to see sluggish demand save for a transient boom during Festive season in October. • Severe drought conditions had adverse impact on many markets in Q4. • Key Tamil Nadu market was severely impacted in Q3 due to unprecedented floods. • Exc
Slide 36: Statement of Audited Financial Results
TTK Prestige Limited Statement of Audited Financial Results for the Quarter and year ended 31st March 2016 PART I (Rs in Crores) Year to Date figures for the Sl.No. PARTICULARS Quarter ended Period ended 31.03.2016 31.12.2015 31.03.2015 31.03.2016 31.3.2015 Audited Unaudited Audited Audited Audited
Slide 37: Going Forward
iene GOING FORWARD 29> >
Slide 38: We Are Now
WE ARE NOW No. 1 Brand in No. 1 Brand in No. 1 Brand in Value Pressure cookers Cookware added Gas Stoves India’s only company India’s largest No. 1 Brand in to offer the complete Kitchen appliance Induction Cook tops Induction Cooking company solution
Slide 39: We are committed to take this leadership position even further
WE ARE COMMITTED TO TAKE THIS LEADERSHIP POSITION EVEN FURTHER!
Slide 40: Investments in Manufacturing
Investments in Manufacturing - about Rs.3.5 billion between FY 2010-11 and FY 2013-14 No Need for Major Capex in the near future Innovation/Development costs – revenue in nature - about 1.5% of sales We have doubled pressure cooker capacity between 2012 & 2014 We have quadrupled Cookware capacity 20
Slide 41: UK Acquisition
UK Acquisition • In April 2016 acquired UK based Horwood Housewares Limited. • Horwood owns Brand names – Judge, Stellar, Kaufman and has deep distribution links in UK. • Brands known in Europe but not penetrated • Sales of 18m GBP and EBIDTA of 2.9m GBP • Provides all-round synergies • This move pr
Slide 42: New Category Launch – FY 17
NEW CATEGORY LAUNCH –FY 17 HEALTHY LIVING BEGINS WITH CLEAN HOME
Slide 43: New Growth area – Cleaning Solutions
New Growth area – Cleaning Solutions Non Electrics Electrics Cleaning Floor Care Air Care Home care Mops aids Electric Air Steam Magic Ladders Mop Purifiers cleaners mops Vacuum Window Spray Flip bins cleaners cleaners mops Floor Stick Mops polishers Squeeze mops
Slide 44: Launching close to 30 SKUs in Prestige Clean Home Range
LAUNCHING CLOSE TO 30 SKUS WITH PRICE POINTS OF Rs.300 to 21000 in Prestige Clean Home Range
Slide 45: Kitchen Appliance Industry & Customer Scenario
Kitchen Appliance Industry & Customer Scenario • Kitchen Appliances Industry in general is fragmented with about 40 to 50% comprising of unorganised players/small regional brands • In line with general economy the growth in the Industry is muted over the last two years • TTK Prestige is the only Nat
Slide 46: Cost & Earnings Trends in the Industry
Cost & Earnings Trends in the Industry • Key raw-material in our Industry is Aluminium for cookers and cookware categories • Cost of crude has an impact on components used in various appliances • Both metal and crude prices are favourably placed • Regarding Electrical Appliances – Components/Finishe
Slide 47: Opportunities
OPPORTUNITIES STRONG FUNDAMENTALS OF INDIAN ECONOMY EXPECTED GDP GROWTH OF ABOVE 7% FROM FY 16-17 NEW INFRASTRUCTURE/SMART TOWNS/RURAL DEVELOPMENT INITIATIVES OF GOVERNMENT SHIFT IN INCOME GROUPS TOP OF THE PYRAMID MARKET SEGMENT ADDITIONAL PRODUCT CATAGORIES IN THE KITCHEN/SPECIFIC HOME
Slide 48: Challenges
CHALLENGES CONTINUING LUKEWARM CONSUMER SENTIMENT WEAK GLOBAL MARKETS PRESSURE ON DISPOSABLE INCOME LOWER GDP GROWTH SINCE 2011-12 POLITICAL STAND-OFFS IMPACTING REFORM PROCESS PROLIFERATION OF REGIONAL BRANDS & THEIR TRADE PRACTICES POSSIBLE DOWN TRADING WARRANTING LOW PRICE POINT PRO
Slide 49: Key Strategy of TTK Prestige in the Current Scenario
Key Strategy of TTK Prestige in the Current Scenario & Expected Impact • Drive consumer interest by well differentiated offerings • Leverage Brand strength to enter select categories transcending Kitchen Domain • Target domestic growth rate in excess of GDP growth rate • Not to indulge in unnatural
Slide 50: Our Response to Challenges
OUR RESPONSE TO CHALLENGES WE BELIEVE THAT WE WILL STRIKE A BALANCE BETWEEN OPPORTUNITIES AND CHALLENGES WE HAVE ALREADY BROAD BASED OUR PRODUCT RANGE AS WELL AS CONSUMER BASE – SEEING EXCELLENT GROWTHS IN NON-SOUTH MARKETS WE WILL CONTINUE TO WIDEN OUR PRODUCT RANGE AND CONSUMER REACH STREN
Slide 51: Significant investments in innovation, HR, logistics and service
WE ARE MAKING SIGNIFICANT INVESTMENTS IN INNOVATION, HUMAN RESOURCE DEVELOPMENT, LOGISTICS AND SERVICE WHEREVER REQUIRED CONSULTANTS OF GLOBAL REPUTE ENGAGED WE HAVE CLOCKED IN A CAGR OF OVER 28% TILL 2013. THUS OUR BASE HAS ALREADY INCREASED. FOR THE CURRENT, FOCUS IS TO WARD OFF SLUGGISH T
Slide 52: Safe Harbour
SAFE HARBOUR THIS PRESENTATION MAY CONTAIN STATEMENTS WHICH ARE FUTURISTIC IN NATURE. SUCH STATEMENTS REPRESENT THE INTENTIONS OF THE MANAGEMENT AND THE EFFORTS BEING PUT IN BY THEM TO REALISE CERTAIN GOALS. THE SUCCESS IN REALISING THESE GOALS DEPENDS ON VARIOUS FACTORS BOTH INTERNAL AND EXTERNAL.
Slide 53: tk
tk