Dabur India Limited · NSE:DABUR
Dabur India — Motilal Oswal 14th Annual Global Investor Conference 2018
40 slides from Dabur India's conference presentation, August 2018
Slide 1: Dabur India Limited
Dabur India Limited Motilal Oswal – 14th Annual Investor Conference August 2018 1
Slide 2: Agenda
Agenda 1. Dabur – Overview 2. Business Structure 3. India Business 4. International Business 5. The way forward 6. Annexure 2
Slide 3: Dabur is the largest science-based Ayurveda company
Dabur is the largest science-based Ayurveda company… Overview Awards Established in 1884 – 134 years of trust and Dabur Red Paste rated as 2nd most excellence trusted brand by the consumers in the Oral Care category by the Brand Equity One of the world’s largest in Ayurveda and natural India’s Most
Slide 4: Manufacturing facilities located across the globe
…with manufacturing facilities located across the globe,… 12 manufacturing locations in India 8 international manufacturing locations Baddi UAE Jammu Sahibabad ` Egypt Alwar Pantnagar Tezpur Newai Nigeria Katni South Africa Turkey Narendrapur Silvasa Sri Lanka Nasik Pithampur Bangladesh Nepal 4
Slide 5: One of the largest distribution network in India
…one of the largest distribution network in India… Urban Rural Factory Factory C&F C&F GT Stockist MT Stockist Insti Stockist Super Stockist Wholesaler Sub Stockist Retailer Retailer Retailer Consumer Consumer Consumer Consumer Distribution reach of 6.4 mn retail outlets with direct reach of 1 mn+ 5
Slide 6: …and a strong financial profile
…and a strong financial profile CAGR : • Revenue has become ~3x over 11.9% the last 10 years 78.3 78.7 77.0 77.5 70.9 Revenue 53.1 61.7 • Last 3 years’ revenue looks from 28.1 34.0 41.0 optically static due to change Operations in accounting standards, demonetization and FY09 FY10 FY11 FY12 FY13 FY1
Slide 7: Agenda
Agenda 1. Dabur – Overview 2. Business Structure 3. India Business 4. International Business 5. The way forward 6. Annexure 7
Slide 8: Business Structure
Business Structure Domestic International (72%) (28%) Domestic Others Organic Acquired FMCG (4%) (67%) (33%) (68%) 8
Slide 9: Agenda
Agenda 1. Dabur – Overview 2. Business Structure 3. India Business 4. International Business 5. The way forward 6. Annexure 9
Slide 10: The domestic business has seen recovery in the past fiscal year
The domestic business has seen recovery in the past fiscal year with growth picking up since Q2 FY18… Value and Volume Trend for Domestic FMCG 23.7% 21.0% 17.7% 13.0% 9.8% 9.7% 7.2% 7.7% 4.1% 2.4% 4.5% 2.4% 0.5% 0.7% (5.2%) (5.0%) (4.4%) (6.6%) Q1 FY17 Q2 FY17 Q3 FY17 Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18
Slide 11: …with broad-based growth…
…with broad-based growth… Revenue Key FY18 Q1 FY19 Category Contribution Brands Growth Growth (FY18) Health 17% 9.4% 27.5% Supplements Healthcare Digestives 6% 10.2% 21.6% (32%) OTC & 9% 3.8% 16.9% Ethicals Hair Care 21% 4.1% 20.6% Oral Care 17% 14.4% 17.3% HPC (50%) Home Care 7% 13.0% 17.4% Skin Ca
Slide 12: …and market leadership in most categories
…and market leadership in most categories Leading position in key categories across verticals #Relative Competitive Position1 #1 #1 #2 #2 #2 #3 #1 #2 #1 #1 #1 Honey Chyawanprash Baby Glucose Hair Oils Oral Care Skin Toilet Cleaners Air Mosquito Juices Massage Care - Fresheners Repellant Oil Bleaches
Slide 13: Drivers of growth – Project Buniyaad
Drivers of growth – 1 Project Buniyaad Enabling Technology Urban Strategy Using technology to track and improve performance Leveraging potential through Channel based approach and automate processes Rural Strategy New Avenues of Growth Split the front line teams into two to increase reach Leveraging
Slide 14: Project Buniyaad has led to larger distribution, higher efficiencies
Project Buniyaad has led to larger distribution, higher efficiencies and improved hygiene Increase in Lines Sold in Rural Increase in Average Brand Sold (ABS) in Rural 8.30 20.0 19.3 8.00 7.90 18.6 17.9 7.60 17.3 7.30 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q1 FY19 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q1 FY19 Re
Slide 15: Drivers of growth – Channel Changes
Drivers of growth – 2 Channel Changes 24.5% 23.5% 23.6% 23.0% 22.2% 21.7% 12.5% 12.8% 11.6% 10.1% 8.7% 7.7% 0.8% 1.2% 0.6% Wholesale Superstockist MT E-comm Enterprise FY17 FY18 Q1 FY19 Superstockist, MT and E-comm gaining saliency; Wholesale and Enterprise continues to shrink Note: Enterprise inclu
Slide 16: Recent Product Launches
Recent Product Launches Vatika Enriched Real Ethnic Range Real Koolerz Real Mocktails Hajmola Chat Cola Coconut Hair Oil Vatika Shampoo Anmol Jasmine HO Odonil Zipper Honitus Hotsip Fem De-Tan Bleach with Satt Poshan Dabur Red Gel Oxy Pro Clear Facial Odonil – Odomos Fabric Glycodab Tablets Kit Frui
Slide 17: Agenda
Agenda 1. Dabur – Overview 2. Business Structure 3. India Business 4. International Business 5. The way forward 6. Annexure 17
Slide 18: International Business – Financial Profile
International Business – Financial Profile Sales (INR bn) CAGR: 14% • International Business comprises the Organic and Acquired business 27.1 24.2 • Organic business (67% of international) is an extension of Indian 23.1 23.2 21.8 portfolio with the same personal care brands operating internationally
Slide 19: Organic International Business
Organic International Business FY06 FY18 Others Others Oral Care 5% Skin Care 10% 2% 7% Hair Oil 34% Oral Care 12% Hamamzaith & Styling Hair Cream 9% 11% Hair Oil Shampoo 93% 17% Key Brands c Organic International Business has evolved from being just a Hair Oil business to a diversified personal car
Slide 20: MENA and SSA GDP Growth Expected to Improve
MENA and SSA GDP Growth Expected to Improve Middle East & North Africa Sub-Saharan Africa MENA Region - GDP Growth % SSA Region - GDP Growth % 3.6% 3.7% 3.4% 3.2% 2.8% 2.2% 2017 2018 2019 2017 2018 2019 Source: IMF WEO April 2018 20
Slide 21: International Business – Recent Marketing Initiatives (1/3)
International Business – Recent Marketing Initiatives (1/3) Dabur Amla Hair Oil - New 360 degree campaign with 22 mn views Dabur Amla Hair Oil - Vol. Mother-Daughter Thematic MS% (Saudi Arabia) - Disproportionate Media spends on 52% PAN-Arab Media - Increase in Vol. MS% 47% Mar-Apr 2018 May-Jun 2018
Slide 22: International Business – Recent Marketing Initiatives (2/3)
International Business – Recent Marketing Initiatives (2/3) Hobby - Launch of Cream Wax NPD – Cream Wax Premium Packaging – Body Wash - Packaging upgrade in Body Wash Vatika - In-Store and Outdoor visibility Merchandisers Gondola Billboards improvement in Southern Africa 22
Slide 23: International Business – Recent Marketing Initiatives (3/3)
International Business – Recent Marketing Initiatives (3/3) Dabur Herbal Toothpaste - Thematic Micro-branding in Nigeria Bus Branding Van Branding Dealer Boards (Lagos and Abuja) ORS (Namaste) - New POS Execution in UK Retail Outlets 23
Slide 24: International Business – Strategic Levers
International Business – Strategic Levers - Capitalize on global Back to Nature trend Innovation - LUPs to drive penetration - Distributor restructuring GTM - Real-time analytics - JBP (Joint Business Planning) with Key Accounts - Saving initiatives Cost Management - Manufacturing efficiencies 24
Slide 25: Agenda
Agenda 1. Dabur – Overview 2. Business Structure 3. India Business 4. International Business 5. The way forward 6. Annexure 25
Slide 26: Key Elements
Key Elements Driving Innovation Capability Improvement 5 1 and Renovation for Market Leadership Cost Optimisation and Improving 4 2 Regionalization Service Levels 3 Channel Focus Strategy 26
Slide 27: Driving Innovation and Renovation for Market Leadership
1 Driving Innovation and Renovation for Market Leadership (a) Focus on Core and Scalable Brands Enhanced Investments in Core Brands Accelerated Growth from Scalable Brands 27
Slide 28: Driving Innovation: Creating Competitive Leverage
1 Driving Innovation and Renovation for Market Leadership (b) Creating Competitive Leverage Superior Claims Superior Formulation Superior Packaging Superiority over mineral oils Superiority over other Almond HO 2x stronger hair vs Other Amla HO 28
Slide 29: Driving Innovation: Media Strategy for Brand Preference
1 Driving Innovation and Renovation for Market Leadership (c) Media Strategy for Driving Brand Preference Consolidated Buys with Impact Fragmented Brand Buys Value Ads Key Shift in Approach Impact Lead Core CPRP Focus Prime Time Focus Network Core Prime High Brand Deals Time Focus on Saliency Integr
Slide 30: Driving Innovation: Driving NPDs
1 Driving Innovation and Renovation for Market Leadership (d) Driving NPDs Q1 FY19 The Way Ahead Strengthening our Ayurvedic/ Natural Offerings Products for Gen Y and Z Premiumization 30
Slide 31: Regionalization RISE
2 Regionalization RISE Regional Insights And Speed of Execution RI : Regional Insights SE : Speed of Execution (Long Term Strategic) (Quick Wins, Low Investment) • Capture Consumer, Packaging and Media Insights • Trade interventions • Use Analytics for Specific meaningful actions • Activations and v
Slide 32: Channel Focus Strategy
3 Channel Focus Strategy Increasing Direct Rural Focus E-commerce/ MT Focus Distribution Range Expansion • E-commerce and MT saliency One of the largest distribution network in going up FMCG in India covering 6.4 mn+ outlets 1. Increase lines sold in – Strong growth across rural platforms Aim to inc
Slide 33: Cost Optimisation and Improving Service Levels
4 Cost Optimisation and Improving Service Levels Project Lakshya Targets • Improve range availability at C&FA and Distributors • Improve Lead Time Adherence Service Level • Improve MT OTIF • Reduction in Logistics Cost Cost • Reduction in Finished Goods Inventory Inventory OTIF – On Time and In Full
Slide 34: Capability Improvement
5 Capability Improvement Matrix Organisation Strengthening the Team Sales E-comm Head DRDC Parlor Channel Head Marketing Marketing Services Healthcare Head Operations OTC Head Trade Marketing Ayurveda Head Shared Goals across Functions Digital Head DRDC – Dabur Research and Development Centre 34
Slide 35: The next growth wave
The next growth wave Build bigger brands More than 15 brands in the range of INR >0.1 to 1 bn which can grow to INR 1bn+ Continued Innovation and Renovation for Younger Consumers NPD pipeline primed to deliver new products in key categories – 4-5 new products every year Driving distribution expansio
Slide 36: Agenda
Agenda 1. Dabur – Overview 2. Business Structure 3. India Business 4. International Business 5. The way forward 6. Annexure 36
Slide 37: Consolidated Profit & Loss
Consolidated Profit & Loss Q1 FY19 Q1 FY18 Y-o-Y (%) FY18 FY17 Y-o-Y (%) Revenue from operations 2,080.7 1,790.1 16.2% 7,748.3 7,701.4 0.6% Other Income 73.7 81.3 (9.4%) 305.2 298.3 2.3% Total Income 2,154.3 1,871.3 15.1% 8,053.5 7,999.8 0.7% Material Cost 1,048.6 914.5 14.7% 3,846.4 3,843.2 0.1% %
Slide 38: Consolidated Balance Sheet (1 of 2)
Consolidated Balance Sheet (1 of 2) All figures are in INR crores, unless otherwise stated As at 31/03/2018 As at 31/03/2017 Particulars (Audited) (Audited) A Assets 1 Non-current assets (a) Property, plant and equipment 1,552 1,479 (b) Capital work-in-progress 42 42 (c) Investment property 54 55 (d
Slide 39: Consolidated Balance Sheet (2 of 2)
Consolidated Balance Sheet (2 of 2) All figures are in INR crores, unless otherwise stated As at 31/03/2018 As at 31/03/2017 Particulars (Audited) (Audited) B Equity and Liabilities 1 Equity (a) Equity share capital 176 176 (b) Other Equity 5,530 4,671 Equity attributable to shareholders of the Comp
Slide 40: For more information & updates, Contact
For more information & updates, Contact: Gagan Ahluwalia (gagan.ahluwalia@mail.dabur) Ankit Joshi (ankit.joshi@mail.dabur)
Dabur India — Motilal Oswal 14th Annual Global Investor Conference 2018 on 6ix