Tribhovandas Bhimji Zaveri Limited · NSE:TBZ
Tribhovandas Bhimji Zaveri — Q4 FY19 Earnings Presentation
30 slides from Tribhovandas Bhimji Zaveri's earnings presentation, May 16, 2019
Slide 1: Cover letter to stock exchanges on earnings presentation
Date: 16th May, 2019 To, To, The Manager, The Manager, Compliance Department, Compliance Department, National Stock Exchange of India Limited SSE Limited Exchange Plaza, Plot No. C/1, Corporate Service Department, G Block, Bandra-Kurla Complex, Phiroze Jeejeebhoy Towers, Bandra (East), Mumbai - 400
Slide 2: Investor Presentation Q4 & FY19 Results
INVESTOR PRESENTATION Q4 & FY19 RESULTS MAY 2019
Slide 3: Disclaimer
DISCLAIMER This presentation has been prepared by Tribhovandas Bhimji Zaveri Limited (“TBZ”) for informational purposes only and does not constitute or form any part of any offer, invitation or recommendation to purchase or subscribe for any securities in any jurisdiction, and no part of it shall fo
Slide 4: Discussion Summary
DISCUSSION SUMMARY • Q4 & FY19 Results Update • About Us • Operational Summary • Business Model
Slide 5: FY19 Result Highlights
FY19 RESULT HIGHLIGHTS In Rs Mn REVENUES * & GROSS MARGIN EBITDA & EBITDA MARGIN PAT & PAT MARGIN 14.1% 14.1% 1.2% 4.2% 4.2% 0.9% 17,514 17,638 731 738 211 153 FY18 FY19 FY18 FY19 FY18 FY19 * Net of Excise Duty OPERATING COSTS (%) REVENUE ANALYSIS Total Revenue Growth % 0.7% - FY19 FY19 4.1% 2.2% 1.
Slide 6: Q4 FY19 Result Highlights
Q4 FY19 RESULT HIGHLIGHTS In Rs Mn REVENUES & GROSS MARGIN EBITDA & EBITDA MARGIN PAT & PAT MARGIN 13.0% 12.7% 4.4% 1.6% 3.4% 0.3% 4,336 4,155 190 140 70 12 Q4 FY18 Q4 FY19 Q4 FY18 Q4 FY19 Q4 FY18 Q4 FY19 OPERATING COSTS (%) REVENUE ANALYSIS Total Revenue Growth % -4.2% - Q4 FY19 Q4 4.4% 1.1% 1.7% 2
Slide 7: FY19 Balance Sheet Update
FY19 BALANCE SHEET UPDATE LEVERAGE ANALYSIS (RS MN) 1.09 1.14 5,313 5,657 4,867 4,941 Mar-18 Mar-19 Equity Net Debt Net Debt/Equity GOLD INVENTORY BREAKUP (%) TOTAL DEBT BREAKUP (RS MN) 5,687 6,054 60.7% 57.2% 2,784 3,000 39.3% 42.8% 2,903 3,054 Mar-18 Mar-19 Mar-18 Mar-19 Own Gold Gold on Loan Work
Slide 8: Q4 & FY19 - Key Result Takeaways
Q4 & FY19 - KEY RESULT TAKEAWAYS REVENUES & OPERATING MARGINS: • Revenues declined by 4.2% YoY • No contribution from Gudi Padwa festival which occurred in April 2019 compared to March 2018 • Higher redemptions under KP scheme in Q4 FY18 • Gross margin declined marginally from 13.0% to 12.7% due to
Slide 9: Brand Building & Marketing Initiatives
BRAND BUILDING & MARKETING INITIATIVES • TBZ has been making consistent investments in its marketing activities to widen its customer base and promote the brand in India • Recently TBZ appointed Bollywood actress Sara Ali Khan as new brand ambassador • Sara Ali Khan will feature in several brand cam
Slide 10: Contemporary Jewellery Designs & Collections
CONTEMPORARY JEWELLERY DESIGNS & COLLECTIONS 9
Slide 11: Contemporary Jewellery Designs & Collections
CONTEMPORARY JEWELLERY DESIGNS & COLLECTIONS 10
Slide 12: Contemporary Jewellery Designs & Collections
CONTEMPORARY JEWELLERY DESIGNS & COLLECTIONS 11
Slide 13: Contemporary Jewellery Designs & Collections
CONTEMPORARY JEWELLERY DESIGNS & COLLECTIONS 12
Slide 14: Q4 & FY19 - Profit & Loss Statement
Q4 & FY19 - PROFIT & LOSS STATEMENT Particulars (In Rs Mn) – Standalone Q4 FY19 Q4 FY18 YoY % FY19 FY18 YoY % Net Revenues 4,155 4,336 -4.2% 17,638 17,514 0.7% COGS 3,629 3,774 -3.8% 15,149 15,053 0.6% Gross Profit 526 562 -6.4% 2,489 2,461 1.1% Gross Margin (%) 12.7% 13.0% -30 bps 14.1% 14.1% 6 bps
Slide 15: FY19 - Balance Sheet
FY19 - BALANCE SHEET Particulars (In Rs Mn) – Standalone March-19 December-18 September-18 June-18 March-18 Shareholders Funds 4,941 4,931 4,823 4,879 4,867 Loan Funds 6,054 6,129 6,292 6,082 5,687 Gold on Loan 3,000 2,957 2,933 2,975 2,784 Working Capital Loan 3,054 3,172 3,359 3,107 2,903 Other Lo
Slide 16: Discussion Summary
DISCUSSION SUMMARY • Q4 & FY19 Results Update • About Us • Operational Summary • Business Model
Slide 17: Why Is TBZ Different?
WHY IS TBZ DIFFERENT ? Pedigree Strong Brand Value • 150+ years in jewellery business • Healthy sales productivity • First jeweller to offer buyback • High footfalls conversion - 80% guarantee in 1938 • High ticket size - Gold – Rs 89 k, • Professional organisation Diamond – Rs 103 k spearheaded by
Slide 18: Key Milestones
KEY MILESTONES STRONG LEGACY OF MORE THAN 150 YEARS BUILT ON TRUST Retail footprint Flagship store Introduced 100% Diamond facility crosses 84k sq ft 2nd Franchise opened in Zaveri pre-hallmarked expansion - ~6k 1st Franchise across 20 cities store opened Bazaar, Mumbai jewellery to ~24k sq ft store
Slide 19: Retail Presence
RETAIL PRESENCE Present across 30 cities PAN-INDIA PRESENCE WITH 42 STORES in 14 states WITH A RETAIL SPACE OF ~123,219 SQ. FT. SPREAD ACROSS 30 CITIES IN 14 STATES NUMBER OF STORES TILL DATE Ludhiana Large Format (> 2,000 sq. ft.) 32 Noida Small Format (<= 2,000 sq. ft.) 10 Lucknow Total Stores 42
Slide 20: Retail Footprint Expansion
RETAIL FOOTPRINT EXPANSION 123,219 110,666 102,930 98,200 42 91,058 88,093 37 82,368 32 30 27 28 25 FY13 FY14 FY15 FY16 FY17 FY18 FY19 No. of Retail Outlets Carpet Area (sq. ft.) 19
Slide 21: Discussion Summary
DISCUSSION SUMMARY • Q4 & FY19 Results Update • About Us • Operational Summary • Business Model
Slide 22: Operational Summary
OPERATIONAL SUMMARY GOLD & DIAMOND VOLUMES 52,010 45,111 44,913 39,958 40,762 4,706 4,216 3,931 4,027 3,738 FY15 FY16 FY17 FY18 FY19 Gold Sales (kgs) Diamond Sales (cts) SSSG - TOTAL (%) AVERAGE TICKET SIZE (RS ‘000) 139 122 129 4.0 115 0.1 103 85 91 89 -0.4 73 80 -2.1 -16.5 FY15 FY16 FY17 FY18 FY19
Slide 23: Discussion Summary
DISCUSSION SUMMARY • Q4 & FY19 Results Update • About Us • Operational Summary • Business Model
Slide 24: Business Model: Manufacturing (Gold)
BUSINESS MODEL: MANUFACTURING Gold PROCUREMENT • Raw Material - Bullion Sources: • Exchange & purchase of old jewellery • Bullion dealers • Banks - imported gold • Banks - domestic gold (gold deposits) on loan • Gold jewellery manufacturing is outsourced. • Vast nation-wide network of 150 vendors •
Slide 25: Business Model: Manufacturing (Diamond)
BUSINESS MODEL: MANUFACTURING Diamond PROCUREMENT • Raw Material - Cut & polished diamonds Sources: • DTC site holders • In-house diamond jewellery manufacturing leading to exclusive designs, lower costs, and higher margins Manufacturing facility at Kandivali, Mumbai MANUFACTURING • spread over ~24,
Slide 26: Business Model: Retail
BUSINESS MODEL: RETAIL EFFICIENT INVENTORY MANAGEMENT HUB & SPOKE MODEL - ROI OPTIMISATION SMALL STORES • <= 2,000 sq ft SMALL • Across the city STORE • Smaller range • Lower price points (up to Rs 500k) SMALL LARGE FORMAT SMALL LARGE STORES STORE STORE STORE • > 2,000 sq ft • Standalone high street
Slide 27: Business Model: Scalability
BUSINESS MODEL: SCALABILITY • TBZ has an expansion plan to increase its retail space from 123,219 sq. ft. at present to around 1,50,000 sq. ft. over near term. • TBZ plans to carry out the expansion through mix of franchisee route and addition of its own stores. • All the prospective expansion locat
Slide 28: Gold Metal Loan: Efficient Sourcing Channel
GOLD METAL LOAN: EFFICENT SOURCING CHANNEL GOLD METAL LOAN ORIGINATION GOLD METAL LOAN REPAYMENT • TBZ takes 10 kg gold from a bank on lease on day 0. • TBZ repays the gold daily based on actual sales of • The contract for gold lease is 180 days. gold jewellery. • TBZ provides a bank guarantee worth
Slide 29: Awards & Recognition
AWARDS & RECOGNITION • “DIAMOND VIVAH JEWELLERY OF THE YEAR” Retail Jeweller India Awards - 2018 • “INDIA’S MOST PREFERRED JEWELLERY BRAND” UBM India - 2017 • “BEST RING DESIGN OVER Rs. 2,50,000” JJS-IJ Jewellers Choice Design Awards - 2016 • “TV CAMPAIGN OF THE YEAR” 12th Gemfields Retail Jeweller
Slide 30: Contact details
Saurav Banerjee Manasi Bodas / Nilesh Dalvi Chief Financial Officer IR Consultant Tribhovandas Bhimji Zaveri Limited Dickenson +91 022 30735000 +91 9821043510 / 9819289131 saurav.banerjee@tbzoriginal.com Manasi.bodas@dickensonir.com nilesh.dalvi@dickensonir.com 29
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