Grasim Industries Ltd. · NSE:GRASIM
Grasim Industries — Q4 FY2019 Earnings Presentation
41 slides from Grasim Industries's earnings presentation, May 24, 2019
Slide 1: Cover letter to stock exchanges
ADITYA BIRLA GRASIM Ref No.: GIL/CFD/SEC/20/052/SE 24th May 2019 BSE Limited The National Stock Exchange of India Limited Dalai Street, Exchange Plaza, 5th Floor, Phiroze Jeejeebhoy Towers, Plot No. C/1, G Block, Bandra-Kurla Complex, Fort, Mumbai - 400 001 Bandra (East), Mumbai 400051 Scrip Code: 5
Slide 2: Q4 FY19 Performance Review
Grasim Industries Limited Q4 FY19 Performance Review 24th May, 2019
Slide 3: Our Leadership Businesses
Our Leadership Businesses # 1 Producer in India Viscose Staple Fibre Caustic Soda Specialty Chemicals* (Epoxy Resins, SBP, CP and Technical & Food grade Phosphoric Acid) Pulp & UltraTech Aditya Birla Fibre^ JVs Cement Capital # 4 Global DG pulp producer # 1 Cement Producer in India Amongst Top 3 Ass
Slide 4: Contents
CONTENTS Content Performance Financial Business Highlights Performance Performance Glossary: ABCL: Aditya Birla Capital Ltd., ABNL: Aditya Birla Nuvo Ltd., FCF: Free Cash Flow, NBFC: Non Banking Finance Company, VSF: Viscose Staple Fiber, VFY: Viscose Filament Yarn, MT : Metric Ton, K: One Thousand,
Slide 5: Standalone Performance Highlights
Standalone Performance Highlights FY19 Q4FY19 Solid Financial Performance Double Digit demand growth Revenue Rs. 20,550 Cr. EBITDA Rs. 4,639 Cr. in Core Businesses Cash Profit Rs. 3,457 Cr. VSF: Up 17% YoY Chemical: Up 21% YoY Caustic Soda sales surpassed one million ton Cash Profit at Rs. 709 Cr. i
Slide 6: FY19 Performance Highlights
FY19 Performance Highlights Net Revenue (Rs. Cr.) EBITDA (Rs. Cr.) PBT (Rs. Cr.) Standalone 30% 31% 32% 4,639 3,680 20,550 15,786 3,542 2,786 10,346 2,629 2,125 FY17 FY18 FY19 FY17 FY18 FY19 FY17 FY18 FY19 Consolidated 31% 18% 14% 72,971 12,820 7,779 10,883 6,795 55,894 5,823 36,068 8,333 FY17 FY18
Slide 7: FY19: Spectacular Performance by all our businesses
FY19 : Spectacular Performance by all our businesses Viscose Staple Chemicals Aditya Birla UltraTech Capital* Fibre Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs. 10,325 Rs. 6,436 Rs. 37,379 Rs. 15,164 Up by 23% YoY Up by 29% YoY Up by 29% YoY Up by 32% YoY Net Revenue Net Revenue Net Revenue Net Revenue Rs. 2
Slide 8: Q4FY19 Performance Highlights
Q4FY19 Performance Highlights Net Revenue (Rs. Cr.) EBITDA (Rs. Cr.) PBT (Rs. Cr.) Standalone 6% 6% 16% 5,352 1,000 756 947 713 4,612 2,876 556 434 Q4FY17 Q4FY18 Q4FY19 Q4FY17 Q4FY18 Q4FY19 Q4FY17 Q4FY18 Q4FY19 Consolidated 21% 27% 34% 20,965 3,786 2,427 17,363 2,973 1,805 9,995 2,142 1,494 Q4FY17 Q
Slide 9: Q4FY19: Spectacular Performance by all our businesses
Q4FY19 : Spectacular Performance by all our businesses Viscose Staple Aditya Birla Chemicals UltraTech Fibre Capital* Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs. 2,625 Rs. 1,688 Rs. 10,905 Rs. 4,730 Up by 18% YoY Up by 17% YoY Up by 17% YoY Up by 32% YoY Net Revenue Net Revenue Net Revenue Net Revenue Rs. 4
Slide 10: Content
Content Performance Financial Business Highlights Performance Performance Grasim Presentation – Q4FY19 9
Slide 11: Income Statement Q4 FY19
Income Statement Q4 FY19 Standalone % Consolidated % Particulars (Rs. Cr.) Q4FY19 Q4FY18 Change Q4FY19 Q4FY18 Change Net Revenue from Operations 5,352 4,612 16 20,965 17,363 21 Other Income 101 96 6 209 199 5 EBITDA 1,000 947 6 3,786 2,973 27 EBITDA Margin (%) 18% 20% 18% 17% Finance Cost 47 49 499
Slide 12: Income Statement - FY19
Income Statement - FY19 Standalone % Consolidated % Particulars (Rs. Cr.) FY19 FY18 Change FY19 FY18 Change Net Revenue from Operations 20,550 15,786 30 72,971 55,894 31 Other Income 568 464 22 801 861 -7 EBITDA 4,639 3,542 31 12,820 10,883 18 EBITDA Margin (%) 22% 22% 17% 19% Finance Cost 199 128 1
Slide 13: Strong Standalone Balance Sheet
Strong Standalone Balance Sheet Standalone Debt / Surplus ( Rs. Cr.) 3,768 3,311 AAA Rating 458 Debt Consistent Strong Free Liquidity, Liquid Mar-19 Cash Flow Zero Net investments 3,358 generation Debt 2,969 Surplus No equity dilution - Growth funded by internal accruals 389 Mar-18 Net FCF generatio
Slide 14: Strong business model to deliver sustained earnings
Strong business model to deliver sustained earnings Last 10 Years Current Status - FY19 Rs. Cr. Rs. Cr. ~21,000 ~7,000 Rs. 4,641 Rs. 2,092 ~2,500 Rs. 516 EBITDA Capex Dividend EBITDA Capex^ Dividend# Payment# FY19 Proposed for FY19 ^ Total Capex planned for next 3 years is Rs. 6,454Cr. Strong busine
Slide 15: Strong Consolidated Financials
Strong Consolidated Financials Financial Ratios Debt / Surplus ( Rs. Cr.) 26,659 31st Mar 31st Mar 2019 2018 19,653 Net Worth (Rs. Cr.) 55,773 57,362 7,006 Debt Liquid Debt: Equity 0.32 0.27 Mar-19 investments 22,402 Net Debt Net Debt: Equity 0.24 0.16 13,574 8,828 Net Debt/ EBITDA 1.53 1.25 Mar-18
Slide 16: Capex Plan
Capex Plan Capex spent Capex Cash Outflow (Net of CWIP Particulars (Rs. Cr.) FY21 FY19 as on FY20 1/4/2019) Onwards VSF: Brownfield Expansion (including debottlenecking) 3,279 Normal Capex (Water supply augmentation & usage 666 reduction, R&D, Environment and Others) 2,092 Chemical: Brownfield Expan
Slide 17: Making Grasim Future Ready
Making Grasim Future Ready Strategic Capex Sustainability at forefront Value Added Specialty Products Capacity expansions Commissioned 3rd Generation 16 under execution in core KTPA Specialty Fibre plant using in- In VSF, post capacity expansion, businesses house Green technology, in May’19. s
Slide 18: Business Performance
Performance Financial Business Highlights Performance Performance Grasim Presentation – Q4FY19 17
Slide 19: Viscose Industry
Viscose Industry Global Prices Trend ($/Kg) Grey VSF 14,543 13,326 8.0% (RMB Q3FY19 Q4FY19 QoQ per ton) Cotton 1.91 1.82 (USD 5.0% per Kg) Q3FY19 Q4FY19 QoQ Industry Data PSF 1.19 1.12 5.0% (USD per Kg) Q3FY19 Q4FY19 QoQ Monthly average prices ► Global VSF prices witnessed weakening during the quart
Slide 20: Viscose business at a glance – Q4FY19
Viscose business at a glance – Q4FY19 ► Overall 12% higher volumes YoY led by debottlenecking of capacity Volume ► The share of domestic sales volume in the overall sales volume Vibrant Domestic improved to 86% (Q4FY19) from 83% (Q4FY18) Demand ► Brand “LIVA” extension from apparels to home textiles
Slide 21: Business Performance: Viscose
Business Performance: Viscose Sales volume (KT)* Net Revenue (Rs. Cr.) EBITDA (Rs. Cr.) 3% 12% 18% 413 2,625 401 139 2,231 124 Q4FY18 Q4FY19 Q4FY18 Q4FY19 Q4FY18 Q4FY19 ► The domestic market maintained a strong demand momentum in Q4FY19, with VSF business registering record sales volume of 120KT (10
Slide 22: LIVA: Expanding product portfolio
LIVA: Expanding product portfolio TRACEABLITY FASTEST MOISTURE SOFT OF SOURCE BIODEGRADABLE MANAGEMENT FEEL for 100% SUSTAINABLE LOW WATER THERMAL HIGHLY FORESTRY CONSUMPTION COMFORT UNIFORM INTRODUCING 40+ LIVA Brands covered, amongst top brands HOME SUSTAINABLE Bed sheets FASHION Duvets & Comforte
Slide 23: VSF Vilayat Project Progress-May 2019
VSF Vilayat Project Progress-May 2019 - since Ground breaking in Nov-18 Capacity 219 KTPA Commissioning Timeline FY21 Capex Commitment 50% (May-19) Grasim Presentation – Q4FY19 22
Slide 24: Sector Overview: Chemicals Industry
Sector Overview: Chemicals Industry ► Caustic soda prices in Asia recovered during the quarter due to supply limitation and rising demand ► Chlor-Alkali prices in India remained firm during the quarter ► Caustic prices in India may soften in the near term with increase in imports ► Demand growth for
Slide 25: Chemical business at a glance – Q4FY19
Chemical business at a glance – Q4FY19 Volume ► Caustic Soda sales surpassed one million ton mark in FY19 ► Caustic demand growing at ~2%-3% CAGR Healthy Demand growth in Caustic and Chlorine VAP’s ► Introduced 4 new brands of chlorine VAPs for consumer facing products Costs Up by Up by Power 3% Sal
Slide 26: Business Performance: Chemicals
Business Performance: Chemicals Sales volume* (KT) Net Revenues# (Rs. Cr.) EBITDA# (Rs. Cr.) 21% 17% 5% 261 434 1,688 215 1,439 412 Q4FY18 Q4FY19 Q4FY18 Q4FY19 Q4FY18 Q4FY19 ► EBITDA up by 5% YoY led by higher sales volume ► Caustic Soda reported 16% YoY increase in production and 21% YoY increase i
Slide 27: Chemicals VAP Project Update (Commissioning June-2019)
Chemicals VAP Project Update (Commissioning June-2019) Grasim Presentation – Q4FY19 26
Slide 28: Business Performance: Pulp JVs
Business Performance: Pulp JVs DG Pulp prices ($/Mt) Net Revenues (Rs. Cr.) 950 930 Q4FY19 1,446 910 12% YoY 890 Q4FY18 1,289 870 850 EBITDA (Rs. Cr.) 830 Sept 17 Feb 18 Sep 18 Feb 19 Jan 18 Jul 18 Aug 17 Aug 18 Jan 19 April 17 Oct 17 Oct 18 Mar 18 Mar 19 July 17 May 17 June 17 Dec 17 May 18 Dec 18
Slide 29: Business Performance: UltraTech
Business Performance: UltraTech Sales volume (MT) Net Revenue (Rs. Cr.) EBITDA (Rs. Cr.) 17% 30% 15% 22 10,905 2,459 1,892 19 9,290 Q4FY18 Q4FY19 Q4FY18 Q4FY19 Q4FY18 Q4FY19 ► The Indian cement industry demand grew approx. by 10%^ in Q4FY19 and approx. by 12%^ in FY19 ► UltraTech’s Capacity utilizat
Slide 30: Business Performance: ABCL
Business Performance: ABCL Lending Book(Rs. Cr.)* AAUM(Rs. Cr.)** 23% 6% 63,119 2,65,109 51,379 2,49,937 FY18 FY19 FY18 FY19 ► Revenue and Net profit after minority interest for Q4FY19 are at Rs.4,730 Cr. and Rs.258 Cr. ► Lending book (Incl. housing) grew 23% YoY to Rs. 63,119 Cr. Raised ~Rs. 11,0
Slide 31: Business Performance- Other Businesses
Business Performance- Other Businesses Net Revenue (Rs. Cr.) EBITDA (Rs. Cr.) 679 55 52 611 EBITDA lower due to one time cost Fertilizers of Rs. 4.5 Cr. on account of asset write-off due to replacement by better efficiency equipment Q4FY18 Q4FY19 Q4FY18 Q4FY19 475 52 387 Significant improvement in 3
Slide 32: Thank You
THANK YOU Grasim Presentation – Q4FY19 31
Slide 33: Consolidated Financial Performance
Consolidated Financial Performance Quarter 4 % Annual % Particulars (Rs. Cr.) 2018-19 2017-18 Change 2018-19 2017-18 Change Net Sales & Op. Income 20,965 17,363 21 72,971 55,894 31 Other Income 209 199 801 861 EBITDA 3,786 2,973 27 12,820 10,883 18 Finance Cost 499 397 1,781 1,364 Finance Cost Relat
Slide 34: Standalone Financial Performance
Standalone Financial Performance Quarter 4 Annual Particulars (Rs. Cr.) % % 2018-19 2017-18 2018-19 2017-18 Change Change Net Sales & Op. Income 5,352 4,612 16 20,550 15,786 30 Other Income 101 96 6 568 464 22 EBITDA 1,000 947 6 4,639 3,542 31 Finance Cost 47 49 199 128 Depreciation 197 185 760 628
Slide 35: Balance Sheet
Balance Sheet Standalone (Rs. Cr.) Consolidated (Rs. Cr.) 31st Mar'19 31st Mar'18 EQUITY & LIABILITIES 31st Mar'19 31st Mar'18 41,959 44,790 Net Worth 55,773 57,362 - - Non Controlling Interest 27,387 26,337 - - Borrowings related to financial services 55,310 44,667 3,311 2,969 Other Borrowings 26,6
Slide 36: Viscose Business Summary
Viscose Business Summary Quarter 4 % Annual % Particulars 2018-19 2017-18 Change 2018-19 2017-18 Change Capacity VSF* KTPA 566 498 14 566 498 14 VFY KTPA 46 46 - 46 46 - Production VSF KT 130 113 16 541 499 8 VFY KT 11 9 22 46 19 142 Sales Volume VSF KT 139 124 12 541 508 6 VFY KT 11 9 22 46 19 142
Slide 37: Chemical Business Summary
Chemical Business Summary Quarter 4 % Annual % Particulars 2018-19 2017-18 Change 2018-19 2017-18 Change Capacity* KTPA 1,147 938 22 1,147 938 22 Production* KT 254 220 15 995 866 15 Sales Volume* KT 261 215 21 1,003 860 17 Net Revenue Rs. Cr. 1,688 1,439 17 6,436 5,004 29 EBITDA Rs. Cr. 434 412 5 1
Slide 38: Cement Business Summary
Cement Business Summary Quarter 4 % Annual % Particulars 2018-19 2017-18 Change 2018-19 2017-18 Change Capacity* Mn. TPA 99 89 11 99 89 11 Production Mn. MT 21 18 17 71 61 16 Sales Volume Mn. MT 22 19 16 76 65 17 Net Revenue Rs. Cr. 10,905 9,290 17 37,379 30,979 21 EBITDA Rs. Cr. 2,459 1,892 30 7,22
Slide 39: Grasim: Group Structure
Grasim: Group Structure Grasim Industries Limited VSF - 566K TPA Caustic Soda - UTCL (60.21%)* ABCL (55.99)* Overseas VFY - 47K TPA ~1147K TPA Others Subsidiary Pulp & VSF JVs Subsidiary Pulp - 74K TPA Epoxy – 94K TPA Grey Cement NBFC Broking Nagda Nagda Fertilizers AV Group NB India Operations (100
Slide 40: Forward Looking & Cautionary Statement
Forward Looking & Cautionary Statement Certain statements in this report may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the
Slide 41: Grasim Industries Limited Quarterly Performance Review
Grasim Industries Limited Quarterly Performance Review Q4 FY19, 24rd May 2019 Grasim Presentation – Q4FY19 40