Granules India Limited · NSE:GRANULES
Granules India — Q4 FY20 Earnings Presentation
28 slides from Granules India's earnings presentation, Jun 2, 2020
Slide 1: Exchange cover letter: Presentation to Analysts/Investors
G GRANULES REGISTERED OFFICE GRANULES INDIA LTD., 2nd Floor, 3rd Block, My Home Hub, Madhapur, Hyderabad - 500 081, Telangana, INDIA. Tel: +91 40 30660000, Fax: +91 40 23115145, mail@granulesindia.com, www.granulesindia.com CIN: L24110TG1991PLCO12471 Dated June 02, 2020 To, National Stock Exchange o
Slide 2: Granules India Limited Investor Presentation Q4FY20 & FY20
Granules India Limited Investor Presentation Q4FY20 & FY20
Slide 3: Safe harbor
Safe harbor The Presentation is to provide the general background information about the Company’s activities as at the date of the Presentation. The information contained herein is for general information purposes only and based on estimates and should not be considered as a recommendation that any
Slide 4: Contents
Contents 1 COVID-19 Update 4 Business Overview 2 Q4FY20 & FY20 Financial Highlights 5 5-year growth trajectory 3 Key focus areas for FY21 6 Core Management team Granules India Limited. 3
Slide 5: Update on COVID-19
1 COVID-19 Update Update on COVID-19 Update on COVID-19 COVID-19 Update Business operations in the last week of March was at 25% utilization, and gradually resumed to 85% in April with strict compliance to safety and government guidelines Business Employees Customers Supply Chain Continuity Engage
Slide 6: Quarter at a Glance
Q4FY20 & FY20 2 Quarter at a Glance Financial Highlights Impact of COVID-19 pandemic on the business: Increase in demand in March across all channels due to hoarding, seeing a slight reduction in the months of April and May in the US markets but continue to have a strong order book going forward
Slide 7: FY20 at a Glance
Q4FY20 & FY20 2 FY20 at a Glance Financial Highlights Revenue up 14% yoy, EBITDA margin expanded 337 bps yoy (including impairment of investments) followed by PAT growth of 42% yoy in FY20 on back of strong performance growth driven by FD sales Reduction of Net debt position by 33% ROE and ROC
Slide 8: Exceptional income and One off in FY20
Exceptional income and One off in FY20 Granules Omnichem Granules Biocause Investment sold to JV partner for INR 1,098.5 Mn Investment sold to JV partner for INR 1,112.3 Mn Entered in 2012 Entered in 2007 INR 500.8 Mn: Book value of investment as on 30 June INR 1,436.5 Mn: Book value of inve
Slide 9: Q4FY20 Revenue, Gross Profit & Gross Margins
Q4FY20 & FY20 2 Financial Highlights Q4FY20...Revenue & Gross Margin Gross Profit & Gross Margins 6,133 (₹ Mn) Gross profit grew 13.9% 3,208 Revenue 5,999 53.5% 2,818 45.9% Q4FY19 Q4FY20 Q4FY19 Q4FY20 Revenue de-grew 2.2% due to restriction imposed on export of Paracetamol API,PFI and FD’s (which wa
Slide 10: Q4FY20 EBITDA & EBITDA Margin
Q4FY20…EBITDA & EBITDA MARGIN (₹ Mn) EBITDA & EBITDA Margin with one time expense EBITDA & EBITDA Margin without one time expense 976 999 1216 976 15.9% 16.7% 20.3% 15.9% Q4FY19 Q4FY20 Q4FY19 Q4FY20 EBITDA and EBITDA Margin was impacted due to one-off expense of INR 217 Mn towards impairment of US p
Slide 11: Q4FY20 PAT & PAT Margin
Q4 FY20…PAT & PAT Margin (₹ Mn) PAT and PAT margin with exceptional item PAT and PAT margin without exceptional item and one off 923 640 640 758 15.4% 13.0% 10.4% 10.4% Q4FY19 Q4FY20 Q4FY19 Q4FY20 Q4FY20 PAT includes exceptional gain of INR 597 Mn from the sale of Omnichem JV and long term capital g
Slide 12: FY20 Revenue, Gross Profit & Gross Margins
Q4FY20 & FY20 2 FY 20…Revenue & Gross Margin Financial Highlights (₹ Mn) Gross Profit & Gross Margins 13,177 25,986 10,236 50.7% Revenue 22,792 44.9% FY19 FY20 FY19 FY20 Revenue slightly impacted due to20.2% restriction imposed on export of Paracetamol API,PFI and FD’s (which was uplifted for PFI &
Slide 13: FY20 EBITDA & EBITDA Margin
FY20… EBITDA & EBITDA MARGIN (₹ Mn) EBITDA & EBITDA Margins with one time expense EBITDA & EBITDA Margins without one time expense 6000 20.2% 25.0% 6000 21.1% 25.0% 5000 20.0% 5000 20.0% 16.8% 16.8% 4000 4000 15.0% 15.0% 3000 3000 10.0% 10.0% 5,253 5,470 2000 2000 3,840 3,840 1000 5.0% 1000 5.0% 0 0
Slide 14: FY20 PAT & PAT Margin
FY 20..PAT & PAT Margin PAT & PAT Margins with one time expense and Exceptional items PAT & PAT Margins without one time expense and Exceptional items 4000 PAT grew 41.9% 14.0% 4000 PAT grew 43% 14.0% 12.9% 13% 3500 12.0% 3500 12.0% 3000 10.0% 3000 10.0% 10.4% 10.4% 2500 2500 8.0% 8.0% 2000 2000 6.0
Slide 15: Geographical Mix and Segment Revenue
Increasing contribution from higher-margin FDs, generics, while remaining backward integrated in APIs (₹ Mn) Growth contributed from North America and India in Finish Dosage segment grew 7.8% YOY Q4FY20 Segment Revenue Geographical Mix 6,133 5,999 3,450 6,133 5,999 +250 CR 3,290 3,190 3,440 1,187 1,
Slide 16: Continuous improvement on set financial goals
Q4FY20 & FY20 2 Financial Highlights Continuous improvement on set financial goals (₹ Mn) Net Debt & Net debt-to-EBITDA (x) ROE (%) FCF 2.4 1.8 1.6 1.4 1.2 1,099 21.2% 22.2% 19.8% 19.9% 9,082 8,550 601 590 8,265 16.7% 222 354 7,888 6,058 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q4FY19 Q1FY20 Q2FY20 Q3FY20
Slide 17: Key focus areas for FY21
3 Key focus areasareas Key focus for FY21 for FY21 Key focus areas for FY21 1 To ensure timely launches of 9 products expected in FY 21 while also increasing the market share of existing products by passing on cost benefits realized through operational efficiencies 2 Placeholder To ensure employee s
Slide 18: Evolving Business Strategy for R&D
3 Evolving Business Strategy for R&D Key focus areas for FY21 Core Business Emerging Business US Generic Business High Volume and Low Value Medium Volume and Medium Low Volume and High Value products Value products Products First line of treatment New Products filling through R&D Focus on R&D
Slide 19: Fast growing, integrated pharma company
Business Overview 4 Fast growing, integrated pharma company Core US Multi APIs/ Business Generics Oncology Focus on volume-based products Fully integrated infrastructure Auxiliary growth engine such as Paracetamol, including R&D, manufacturing Multi-product and multi-stage Metformin HCl, Ibu
Slide 20: Vertically-integrated, high-growth company
Business Overview 4 Vertically-integrated, high-growth company APIs Inhouse Active Pharmaceutical Ingredients (API) manufacturing with focus on efficiently creating high-quality APIs in key therapeutic categories PFIs World’s largest Pre-formulation Ingredients (PFI) facility at Gagillapur. PFIs tak
Slide 21: The Granules India Advantage
Business Overview 4 The Granules India Advantage Business Overview Engineering R&D solutions for large 01 scale manufacturing, strengthening our core molecules for existing and future APIs. R&D has ability to make us untouchable. Presence across the value chain: APIs, PFIs and FDs which builds in ef
Slide 22: Manufacturing excellence driven by innovation and R&D
Manufacturing excellence driven by innovation in state-of-the-art facilities and Research & Development R&D Capabilities R&D Spend (₹ Mn) R&D to develop products that create intellectual wealth and 1,269 5.6% 6.0% commercialize cost-effective, quality products in diversified therapeutic areas 1083
Slide 23: Strong Regulatory Compliance history
Business Overview 4 Strong Regulatory Compliance history Installed Inspection Value chain Facility location Approvals Outcome capacity Date Bonthapally 34,560 TPA U.S. FDA, EDQM, WHO, COFEPRIS, INFARMED July-19 Clear API Jeedimetla 4,800 TPA U.S. FDA, EDQM, COFEPRIS, WHO, CDCSO March-18 Clear Vizag
Slide 24: 5-year growth trajectory: Revenue, EBITDA, PAT
5-year growth 5 trajectory Building on solid base; unlocking value underway *EBITDA and EBITDA Margins (₹ Mn) 20.8% 20.2% 25,986 22,792 16.8% 20.0% 16.5% Revenue 16,918 13,829 14,353 5,253 3,840 2,988 2,784 2,763 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 12.9% 11.4% 10.4% Invested Capex to d
Slide 25: Increasing contribution from FDs: 5 years trajectory
Increasing contribution from FDs while remaining backward integrated in APIs : 5 years trajectory (₹ Mn) Higher revenue contribution coming from regulated market, which contributed 73% to total revenue 16,918 22,792 25,986 14,353 13,879 13,829 6,612 6,010 11,113 5,055 5,393 4,573 4,029 4,083 3,795 3
Slide 26: Improving returns; focus on FCF generation
5-year growth 5 trajectory Improving returns; focus on FCF generation (₹ Mn) Net Debt & Net debt-to-EBITDA (x) Cash-to-Cash cycle (days) 8,704 9,082 119 117 6,138 6,058 3.1x 110 FCF 2.4x 2.1x 104 1.2x 2,645 Mar'17 Mar'18 Mar'19 Mar'20 Mar'17 Mar'18 Mar'19 Mar'20 ROCE (%) ROE (%) Mar'17 Mar'18 Mar'19
Slide 27: Core Management Team
Core Management 6 Core Management Team team C Krishna Prasad Mr Prasad’s journey as pharma entrepreneur began in 1984, when he set up a paracetamol API manufacturing facility that focused on capital and process efficiency. Pharmaceutical formulations intermediates (PFIs) as a cost efficient product
Slide 28: Thank you
Thank you Sandip Neogi (CFO)/ Krishna Raghunathan (VP Finance) Granules India Ltd Granules India Ltd Floor 2 Block 3 My Home Hub Madhapur Hyderabad 500081 Sandip.Neogi@granulesindia.com CIN: L24110TG1991PLC012471 krishna.raghunathan@granulesindia.com Voice: +91 40 30660000/30663600 Fax: +91 40 23115