Ester Industries Limited · NSE:ESTER
Ester Industries — Q4 FY23 Earnings Presentation
37 slides from Ester Industries's earnings presentation, June 2023
Slide 1: Investor Presentation June 2023
stor Presentation IDUSTRIES LTD. June, 2023
Slide 2: Forward-looking statements disclaimer
Certain statements in this document may be forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties like government actions, local political or economic developments, technological risks, and many other factors that could cause actual results to diff
Slide 3: Agenda
About Us Q4 & FY23 Performance Ester 2.0 Investment Thesis Business Overview 3
Slide 4: Diversified business portfolio and sales mix (FY23)
Sales Mix (FY23) Diversified business portfolio Polyester Comprehensive product suite Films 73% State-of-the-art manufacturing facilities Specialty Global footprint Polymers 16% Experienced management team *Engineering Plastics 11% Strong Financial profile * Results for FY23 include results of Engin
Slide 5: Company at a glance
1985 GURGAON, INDIA #2 Year of Incorporation Corporate Headquarters Business Segments* 549 – KHATIMA, About 50 COUNTRIES SITARGANJ, GURGAON CRISIL A (Industry Outlook – Negative) 159 - HYDERABAD Global Footprint People Credit Rating (Long Term) • PF - Polyester Film; SP - Specialty Polymers (EP - En
Slide 6: Manufacturing locations
Sitarganj Haryana Uttarakhand Gurgaon Khatima Telangana* Corporate Headquarter Manufacturing facility *Commercial production at New BOPET Film plant at Telangana commenced on 20th January 2023 6
Slide 7: We serve about 50 countries
ESTER IMETETSS LT, Ha hot ok eS *
Slide 8: 8
8
Slide 9: Q4 FY23 performance - continued operations
Particulars – Continued Operations (Rs.cr) Q4 FY23 Q4 FY22 % FY23 FY22 % ▪ While Specialty Polymers performed Revenues 256 305 (16) 1,095 1,119 (02) well during the quarter & year, Film business performance was impacted EBITDA (including Non operating income) 19 53 (64) 117 182 (36) by excess supply
Slide 10: Financial results - continued operations
Particulars – Continued Operations (Rs.cr) Q4 FY23 FY23 Revenues 293 1,127 EBITDA (including Non operating income) 9 104 Margins (%) 3.1 9.2 PAT (Continuing operations) (18) 12 Margins (%) - 1.1 Particulars – Discontinued Operations (Rs.cr) PAT from discontinued operations - 13 PAT from disposal of
Slide 11: Chairman's comments on results
Commenting on the results, Mr. Arvind Singhania, Chairman, Ester Industries said “We have ended the year on a positive note with both our businesses making a comeback over previous quarter. Specialty Polymer business performed well as sales volumes of our marquee products revived during the quarter
Slide 12: Ester 2.0 - Specialty Company
ESTER INDUSTRIES LTD. > Ester 2.0 “Specialty” Company 12
Slide 13: Ester 2.0
Knowledge Innovation ESTER Customization 2.0 Technology 13
Slide 14: Ester 1.0 to Ester 2.0 and achievements
Ester 2.0 Ester 1.0 ▪ Specialty Polymer SBU Achievements o Largely patent protected – high entry barriers ▪ Commoditized product portfolio Revenues o High sustainable margins ▪ Limited bargaining (FY12-FY16) (FY17-FY23) o High growth potential power 2.4% CAGR 9.7% CAGR ▪ BOPET Film SBU ▪ Low and unp
Slide 15: Revenues, EBITDA, margins and PAT trends
Revenues (Rs.cr) EBITDA (Rs.cr) 1,405 1,213 236 243 928 1,028 1,039 992 189 886 896 824 771 707 108 118 74 71 70 66 41 42 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 EBITDA Margins (%) PAT (Rs.cr) 142 139 24.6% 100 19.1% 17.9% 49 11.1
Slide 16: Net debt, ROCE and dividend payout
Net Debt (Rs.cr) ROCE (%) 335 363 348 304 300 290 31% 267 28% 26% 242 157 183 142 14% 8% 7% 7% 7% 9% 3% 3% FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 Dividend Payout (%) 37.2% 13% 21% 20% 13.4% 10% 0.0% 37% 0.0% 0.0% 0.0% FY13 FY14 F
Slide 17: Shareholding pattern
35.62% 35.57% 35.71% 35.64% Mar 22 Jun 22 Dec 22 Mar 23 64.04% 64.04% 64.04% 64.04% 0.34% 0.39% 0.25% 0.32% 17
Slide 18: Investment thesis
Specialty Polymers - Polyester Films - High Largely IP protected share of value added product portfolio products Rewarding shareholders Scaling up capacities with dividend Strong balance sheet 18
Slide 19: Green initiatives and focus on sustainability
Green Initiatives Focus On Sustainability BIO-BASED Fuel Consumption 7 2 3 PVC FREE fe E . 3 2 wist Wrap / Shrink Film) BIO-BASED Raw Material b, ~~ ie SS PACKAGING MATERIA x Reduction/ Recycling J 4 ® iL REPLACEMENT a lized High Barrier film) bal
Slide 20: Specialty Polymer
oe 4 ¢ ESTER INDUSTRIES LTD. Specialty Polymer 20
Slide 21: Largely IP protected business
Customer High entry retention Largely IP barriers – ensured as High margin Marquee Export protected patent largely business clientele oriented business protected patent protected
Slide 22: Business opportunity: stain-resistant carpet master batch
Problem Solution Business Opportunity USA, largest High cost towards carpet stain removal Flexible low cost solution producer of Carpets ▪ Stain marks on (nylon) carpets given ▪ Ester has developed a PET based master & Rugs boasts of spillover / spillage of liquid shortens its batch, which imparts p
Slide 23: Supplying innovative PBT polymers to a global chemical leader
Regularly manufacturing & supplying Innovative Signed ‘Manufacture and Supply Agreement’ with a Polybutylene Terephthalate (PBT) polymers to a global global chemical leader in April 2019 effective 1st April chemical leader 2019 for 2 years for 400 MT per annum Ester Industries is among the only comp
Slide 24: Applications
Consumer electronics Polyethylene Terephthalate (PET) Textile – Flame Retardant, Deep dyeable master batches, Cationic dyeable master batch Applications Polybutylene Terephthalate (PBT) Carpets – Stain Resistant Master Batches Products Carpets – Deep Dyeable Master Batch Polyethylene Naphthalate (PE
Slide 25: Specialty Polymers performance and volumes
Figs. in cr Q4 Q4 Particulars FY23 FY22 % FY23 FY22 % Volumes (MT) Sales Q4FY22 Q4FY23 878 903 (2.8) 3,613 3,600 +0.4 (Vol's MT) Revenue 52 47 10.6 198 173 +14.5 398 EBIT 12 14 (14.3) 57 56 +1.8 Innovative PBT 468 Margins (%) 23.5 28.9 (540 bps) 28.8 32.2 (340 bps) ▪ Q4FY23 witnessed a sharp recover
Slide 26: Packaging Film Business
ESTER INDUSTRIES LTD. Packaging Film Business 26
Slide 27: Global and domestic scenario
Global Scenario: Domestic Scenario: ▪ Demand growth of 6% - 6.5% ▪ Strong double digit growth rate of 11%-13% pa over past 5 years ▪ BOPET film used in flexible packaging applications will continue to be the key end use sector, accounting for ▪ Low per capita consumption of BOPET; new innovative nea
Slide 28: Film business at a glance and capacity
108,000 23,200 #35 MTPA MTPA Years of experience Polyester Film capacity Metallized Polyester Film capacity (including Telangana capacity) (including Telangana capacity) About 67,000 Telangana 50 23% MTPA Plant Export market Share of value-added Polyethylene Terephthalate Commercial production (# of
Slide 29: Value-added mix and domestic/export split
Value Added (%) *Film business (excl. chips) Domestic Exports 22 22 17 17 (Rs.cr) FY20 FY21 FY22 FY23 23 29 30 20 EBIT 180 219 150 72 77 71 70 80 Margins (%) 24.5 31.9 17.8 8.1 FY20 FY21 FY22 FY23 FY20 FY21 FY22 FY23 Pass through business model as far as raw material prices are Product mix – despite
Slide 30: Applications
White Opaque High Clear Flexible Packaging Applications High Barrier Embossable Barrier Packaging Products Heat Saleable Twist Wrap Embossing Shrink film Anti - Static Lidding Metalized High Barrier Matte Label & Graphics 30
Slide 31: Film business Q4FY23 performance
Figs. in cr Particulars Q4FY23 Q4FY22 % FY23 FY22 % Sales (Vol’s MT) 14,740 14,028 5.0 57,172 58,151 (1.6) Revenue* 201 256 (21.5) 880 938 (6.2) EBIT+ 7 49 (85.7) 72 153 (52.9) Margins (%) 3.4 19.2 (1,580 bps) 8.2 16.3 (810 bps) ▪ Q4FY23 witnessed marginal recovery on sequential basis on the back of
Slide 32: Ester Filmtech Telangana plant
▪ Ester Filmtech Limited, a wholly-owned-subsidiary of Ester Industries Limited, commenced commercial production on 20th January 23 at new Polyester (BOPET) film manufacturing plant in the State of Telangana. ▪ Generated revenues worth Rs.49 crore during its first quarter of operation (Q4FY23); Part
Slide 33: Ester Filmtech financials
Particulars – Continued Operations (Rs.cr) Q4 FY23 FY23 Net Sales 49.06 49.06 Other Operating Income 0.06 0.06 EBITDA (9.96) (12.70) Other Non-Operating Income 0.03 0.03 Cash Profit (15.93) (19.24) PBT (20.68) (24.15) PAT (20.68) (24.15) OCI (0.07) 0.08 33
Slide 34: Engineering Plastics
Engineering Plastics
Slide 35: Engineering Plastics discontinued operations and divestment
Figs. in cr EP SBU - Discontinued Operations Q4FY23 Q4FY22 % FY23 FY22 % ▪ On 15th September 2023, divested its Revenue from Operations - 85 - 136.01 295 (54%) Engineering Plastic Business on Slump Profit before Tax - 12 - 17.68 68 (74%) Sales basis to Radici Plastics India Private Limited in an all
Slide 36: About Us and contact details
About Us: (CIN :- L24111UR1985PLC015063) Incorporated in 1985, Ester Industries Limited (EIL) is an ISO 9001:2008,ISO 22000:2005,TS16949:2002 certified Company engaged in the manufacture of polyester films, specialty polymers and polyester chips with manufacturing facilities located in Khatima & Sit
Slide 37: Thank You
KK ERS 2. 1 nt tines een a ae (NS. ROC AH Rit) la At ei § OE LTT aL | ‘iy 7 a WSs Seep ~ = ESTER Thank You INDUSTRIES LTD.