Adani Ports & Special Economic Zone Ltd · NSE:ADANIPORTS
Adani Ports & Special Economic Zone — Investor Presentation (November 2020)
44 slides from Adani Ports & Special Economic Zone's investor presentation, November 2020
Slide 1: Adani Ports and SEZ Limited
Adani Ports and SEZ Limited November, 2020
Slide 2: Contents
Contents A Group Profile B Transformational Journey of APSEZ C Company Profile D Finance Policy E ESG F Annexure 2
Slide 3: Adani Group: A world class infrastructure & utility portfolio
Adani Group: A world class infrastructure & utility portfolio Energy & Utility Adani Transport & Logistics Portfolio Portfolio • Marked shift from B2B to B2C businesses– 63.5% 100% 75% 75% • AGL – Gas distribution network to serve key APSEZ SRCPL ATL AGEL geographies across India Port & Logistics Ra
Slide 4: Adani Group: Decades long track record of industry best growth rates across sectors
Adani Group: Decades long track record of industry best growth rates across sectors Port Cargo Throughput (MT) Renewable Capacity (GW) Transmission Network (ckm) CGD7 (GAs8 covered) 161% 45% 12% 21% 2.5x 6x 3x 30% 1.5x 5% 7% 25% Industry Adani APSEZ Industry AGEL Adani Industry ATL Industry AGL 2014
Slide 5: Adani Group: Repeatable, robust & proven transformative model of investment
Adani Group: Repeatable, robust & proven transformative model of investment Phase Development Operations Post Operations Origination Site Development Construction Operation Capital Mgmt Activity • Site acquisition • Engineering & design • Redesigning the • Analysis & market • Life cycle O&M capital
Slide 6: APSEZ: A transport utility with string of ports and integrated logistics network
APSEZ: A transport utility with string of ports and integrated logistics network String of Ports • Twelve Ports ~490 MMT of augmented capacity. • Setting benchmark in turnaround time across 66% 54% 67% industry. 92% FY15 8% Capacity 490 MMT FY20 33% • Single window service & excellence in operations
Slide 7: APSEZ: Financial discipline and prudent policy creates value
APSEZ: Financial discipline and prudent policy creates value Capital Management 250 5 221 204 207 4.5 • Investment Grade rated since FY16 200 186 179 4 4.4 3.5 • Improve leverage ratio (from 4.4x to 2.9x) 150 3 Net Debt (INR Bn) 3.4 Net Debt/EBITDA 2.5 • Incremental earnings deployed for growth (EBI
Slide 8: APSEZ: Immense value creation
APSEZ : Immense value creation FY16 FY20 FY25 Capital Employed* Rs.341 bn. 1.4x Rs.480 bn. 1.05x Rs.505 bn. EBITDA Rs.46 bn. 1.7x Rs.76 bn. 1.9x Rs.145bn. Net Debt / 3x EBIDTA 4.4x 1.5x 2.9x = ROCE 11% 160 bps 12.6% >740 bps 20%+ • Strict covenant management to maintain/improve IG rating. • EBITDA t
Slide 9: APSEZ: Transformational journey
APSEZ : Transformational journey Industry Business • 2.5x growth compared to market achieved without • From a single port single commodity to an integrated dilution in equity. logistics platform. • Growing responsibly with a sustainable approach. • 90% of economic hinterland coverage. • Integrated l
Slide 10: APSEZ: Largest private transport utility
APSEZ : Largest private transport utility APSEZ – Dhamra Port Ports Ports One Oneto totwelve ten in in Import - Export - Steel twenty twentyyears years Coking coal (HRC/CRC) 2x Port income String of Ports Ports of Prosperity Port gate to 2x Warehousing Warehousing SEZ customer gate Warehousing SEZ i
Slide 11: Assets Details
Assets Details
Slide 12: Largest network of ports in India
APSEZ : Largest network of ports in India West Coast East Coast Capacity 327 MMT Capacity 163 MMT FY06 FY21 Dahej 14 MMT Tuna Moga Kotkapura Patli Kanech Kilaraipur Dhamora 1 Port 12 * 14 Kannauj MMT Kishangarh Samastipur and Darbhanga 10 MMT Capacity 490 MMT Mundra Vidisha Katihar Harda 264 MMT Hos
Slide 13: APSEZ: SEZ Port development - recurring income stream
APSEZ : SEZ Port development - recurring income stream Mundra 8,491 65% 80% 2020 Dhamra 1,650 2019 20% 35% Total east coast land – 4658 Ha Krishnapatnam * 2,748 Kattupalli 260 • Total land bank of ~13k Ha. • Bringing customer inside Port gate. • Twin advantage of availability of large contiguous lan
Slide 14: APSEZ: Strategic partnerships with global majors driving value
APSEZ : Strategic partnerships with global majors driving value West Coast East Coat Terminals Mundra Kattu- Krishna- Terminals Hazira Dahej Dhamra palli patnam Vizag Tuna Vizhin- Dighi(1) Myanmar jham Ennore Goa Dahej Dhamra Mundra CT 3 Mundra CT 4 Petronet LNG MCS - Second CMA-CGM - Fourth 50% Pet
Slide 15: APSEZ: Growth journey
APSEZ : Growth journey 223 208 169 180 152 • Diversification of cargo - cargo like LNG/LPG. • Serving developing industrial hinterland, provides ample growth opportunities. • Rapidly increasing footprint of integrated logistics, expected to have high FY16 FY17 FY18 FY19 FY20 growth to compliment por
Slide 16: Finance policy
Finance policy
Slide 17: APSEZ: Finance policy
APSEZ : Finance policy Consistent investment grade Shift towards long term FX risk management- Natural rating financing and profile Hedge • Since FY16, capped at sovereign. • 95% of debt is long term • Natural hedge flows from having a (compared to 74% in FY16). portion of balance sheet in USD • Ear
Slide 18: Cash flow engine
APSEZ : Cash flow engine 80 76 60% 71 71 70 52% 50% 57 • Strong operational performance and maintenance of 60 40% margins deliver increased free cash flow. 50 46 30% 32% 30% 40 20% • FCF* conversion has increased from -16% of EBITDA to 52%. 30 10% • Net Debt remained at similar levels and net debt t
Slide 19: APSEZ: Focus on improving ROCE
APSEZ : Focus on improving ROCE History of growth Future of growth 22% 25% 21% 20% 23% 18% 19% 19% 16% 16% 18% 14% 14% 15% 14% 10% 12% 13% 10% 11% FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 ROCE ROE ROCE ROE • Recent acquisitions of Dhamra, Kattupalli and Krishnaptnam to generate higher ROCE
Slide 20: ESG
ESG
Slide 21: APSEZ: ESG philosophy
APSEZ : ESG philosophy Adherence to global environment guidelines like – Disclosure in CDP – Climate Change and Water Security, SBTi; Supporter of TCFD, Member of IUCN All port certified with Integrated Management System (ISO 9001, 14001 & 45001) and 4 ports with Energy Management System (ISO 50
Slide 22: APSEZ: Climate strategy
APSEZ : Climate strategy Optimizing Carbon Intensity Resource and Bio-diversity Waste Management • Carbon foot-printing and disclosure • Energy Management • Waste Reduction (5R* ) • Improving Carbon Efficiency • Optimizing Input Consumption • Circular Economy • Approaching Carbon Neutrality • Approa
Slide 23: APSEZ: Key focus areas FY21
APSEZ : Key focus areas FY21 Liquidity Management Focus on Cash Conservation • Rationalizing operating expenses : • Focus on maintaining adequate liquidity to tide • Improving efficiency and optimizing cost. over uncertainties and unpredictable scenarios. • Converting fixed cost to variable cost. •
Slide 24: APSEZ: Investment opportunity and Medium Term Growth Targets
APSEZ : Investment opportunity • Strong sponsorship of Adani Group. APSEZ : Medium Term • Transport utility which encapsulates entire gamut of supply chain with Growth Targets 25% market share and 90% of hinterland coverage in India. • Diversification of cargo mix, coasts and customer base de-risks
Slide 25: Annexures
Annexures
Slide 26: Maintaining Investment grade since half a decade
APSEZ : Maintaining Investment grade since half a decade Rating Agency Rating/ Outlook Remarks APSEZ International Rating Fitch BBB- / Negative S&P has reaffirmed its rating as BBB-/Stable Due to revision of sovereign rating from stable to Moody’s Baa3 / Negative negative, Fitch & Moody’s have revis
Slide 27: Robust business, prudent capital management, facilitates access to global credit markets
APSEZ : Robust business, prudent capital management, facilitates access to global credit markets Issue Size (USD Company Issue Date Maturity Date Coupon Debt Structure Rating Mn.) 500 Jan,17 19-Jan-2022 3.95% Bullet BBB- (S&P, Fitch) / Baa3 (Moody's) 650 Jul,19 24-Jul-2024 3.38% Bullet BBB- (S&P, Fi
Slide 28: Leveraging technology on an enhanced service base
APSEZ : Leveraging technology on an enhanced service base Design Bidding Automated Automated & Integrated Workflow Project Management Workflow & Platforms for Internal and External 1 Data Based Stakeholders – providing visibility Operations Collaboration Decision making & data based decision making
Slide 29: People – Building future ready organization
APSEZ : People – Building future ready organization Leadership pipeline Continuous Capability Talent development Development Management • Leadership readiness for new • Focused training approach. • Create Opportunities for business and international expansion. Internal Talent. • People in sync with
Slide 30: Sustainability Roadmap
APSEZ: Sustainability Roadmap Target by FY 21 Target by FY 25 Energy Intensity – 40% Reduction Energy Intensity – 50% Reduction Natural Resource Conservation Water Neutrality Roadmap Alliance for Water Stewardship Water Intensity – 50% Reduction Water Intensity - 55% Reduction RE Installation – 20 M
Slide 31: Sustainability Roadmap
APSEZ : Sustainability Roadmap Target by FY 21 Target by FY 25 Safety Mandatory Induction Training for BSC 5 Star Audit and Certification everyone entering Work area Employee Turnover < 6% Employee Turnover < 5% Employee Development and Employee Satisfaction Score - 4.2/5 Employee Satisfaction Score
Slide 32: Sustainability Roadmap
APSEZ : Sustainability Roadmap Recent Policy Initiatives FY21 Targets Policy on “Related Party Transaction All CXOs level employees and KMPs for Acquiring and Sale of Assets”. compensation to be linked to safety. Policy Capital Allocation policy for all new Audit Committee and Nomination & Remunerat
Slide 33: Case: Carbon Footprint Reduction and Waste Management
Case : Carbon Footprint Reduction and Waste Management Renewable Energy Initiatives Integrated Waste Management Energy Mix Waste Management through 5R Principle (Reduce, Reuse, Reprocess, Recycle, Recover) Renewable 6% Renewable 25% FY 2 0 Conventional 94% FY 25 Conventional 75% Initiatives Achievem
Slide 34: Social Up-liftment Fisherman Community FY20
APSEZ : Social Up-liftment Fisherman Community FY20 Education Community Health Free Education – Transportation Support – Medical Support – Support for Insurance cover – 155 students 605 students 9876 persons 2566 persons Play School for – Turtle Conservation Trainings Senior Citizen Scheme Medical F
Slide 35: Q2 FY21 Operational and Financial Highlights
Q2 FY21 Operational and Financial Highlights
Slide 36: Operational highlights - Q2 FY21
APSEZ : Operational highlights - Q2 FY21 • Cargo volume of 56.25 MMT a Q-o-Q growth of 36%, • KPCL acquisition completed in first week of October. which is 2 times the all India cargo growth of 18%. • Myanmar - To start commercial operation by Mar ‘21. • 300 bps increase in overall cargo market shar
Slide 37: Cargo volume comparison – Q2 and H1 FY21
APSEZ : Cargo volume comparison – Q2 and H1 FY21 (MMT) 36% 18% 11% 14% 56 2x growth 109 506 235 98 434 41 199 APSEZ All India** APSEZ All India ** Q1 FY21 Q2 FY21 Q1 FY21 Q2 FY21 H1 FY20 H1 FY21 H1 FY20 H1 FY21 34% 31% 62 7% 45 130 17% 24 42 109 18 47 APSEZ All India ** APSEZ All Ind
Slide 38: Financials - Q2 FY21
APSEZ : Financials - Q2 FY21 • Operating revenue at Rs.2,903 cr. growth of 27%. • APSEZ maintains investment grade rating. • Net Debt to EBITDA at 3.44x. • Consolidated EBITDA at Rs.1,851 cr. growth of 29%. • Average maturity at 5.2 years. • Port revenue at Rs.2,432 cr. growth of 28%. • Loans increa
Slide 39: Debt profile – H1 FY21
APSEZ : Debt profile – H1 FY21 5% 1% Short Term (%) Long Term (%) 95% • 7 year bullet repayment bond for 99% USD 750 mn issued for refinancing Mar ‘20 Sept ‘20 KPCL debt. • Currency mix in our debt portfolio is 71% 70% 68% 68% in line with debt capital program. 32% 32% 30% 29% Secured (%) Unsecured
Slide 40: Debt profile – H1 FY21
APSEZ : Debt profile – H1 FY21 (Rs. in cr.) 6% 5% 4% 1% 2% 1% 1% 8% 2,552 24,831 9% 5% 10% 4,361 5,039 21% 7% 22,137 22% 536 3% 17% 32% 8% 21% 61% 63% 50% 42% | # Mar '20 Cash Forex MTM New FX Debt New INR Debt Sept '20 Mar-18 Mar-19 Mar -20 Sept-20 USD Bond Rupee Bond ECA/ECB RTL CP PCFC, STL, & OD
Slide 41: Strong operational performance improves free cash generation
APSEZ : Strong operational performance improves free cash generation 80 76 100% 71 71 70 88% 80% 57 60 60% 50 46 52% 40% 40 30% 32% 33 • EBITDA conversion to free cash* 20% 30 increasing consistently on account of -1% 0% 20 -16% improvement in working capital. 10 -20% 0 -40% • Net debt to EBITDA* in
Slide 42: Key ratios H1 FY21
APSEZ : Key ratios H1 FY21 30% 7.0x 5.9x 25% 6.0x 4.9x 4.8x 4.5x 4.4x 5.0x 20% 4.0x 15% 3.0x • All key rating ratios continue to be in the 10% prescribed range. 2.0x 5% 1.0x • FFO to Gross Debt and FFO to Net Debt 17.0% 18.6% 22.4% 25.1% 18.6% 22.6% 22.7% 27.6% 19.4% 25.3% 0% 0.0x declined in H1 FY2
Slide 43: Outlook FY21 – Reverts to growth trajectory
APSEZ : Outlook FY21 – Reverts to growth trajectory Cargo volume expected to be in the range of 225 MMT - 230 MMT excluding KPCL. KPCL volume in H2 FY21 to be around 20 MMT. Mundra ~142, Hazira ~22, Dhamra ~30 to 32 and Kattupalli ~ 11 MMT. Consolidated revenue expected to be in the range of
Slide 44: Investor Relations Team
Certain statements made in this presentation may not be based on historical information or facts and may be “forward-looking statements,” including those relating to general business plans and strategy of Adani Ports and Special Economic Zone Limited (“APSEZL”),the future outlook and growth prospect
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