atul presentation

8/12/2019 Atul Presentation

1/98

Presentation

to

Analysts

May 7, 2013 No of main slides: 85Time: 30 minutes


2/98


3/98

Contents

General Overview 1-21

Financial Overview 22-

Business Overview 57-104


4/98

Lalbhai Group

Commenced manufacturing activities in 1908

Textiles, Chemicals, Engineering

Group sales US$1.5 billion

Health, Education, Culture

1|85


5/98

Shri Kasturbhai Lalbhai2|85


6/98

Founder Director, Reserve Bank of India3|85


7/98

Founder Chairman, Indian Institute of Technology, Mumbai4|85


8/98

Founder Board Member Indian Institute of Management, Ahmedabad5|85


9/98

Founder Director, ICICI6|85


10/98

Atul Ltd

Founded in 1947 by Kasturbhai Lalbhai

Manufacturing and marketing of chemicals

Create wealth, generate employment, be self reliant

7|85

f hi i i ifi


11/98

A moment of historic significance

8|85


12/98

Purpose

We are a conglomerate committed to significantly enhance value

for all our stakeholders by

fostering a spirit of continuous learning and innovation

using science and technology in a responsible way

providing high quality products and services and becoming the

most preferred supplier

seeking sustained and dynamic growth and securing long-term success

having people who practice values and high standards of behaviour

taking care of the surrounding environment and

improving the quality of life in the communities we operate in

9|85


13/98

Eventful 2012-13

Inauguration of ARDP facility by HonbleChief Minister of Rajasthan, Shri Ashok Gehlot

Transforming economy and ecology of arid region

10|85


14/98

Inauguration of ARp-C plant by HonbleChief Minister of Gujarat, Shri Narendra Modi

Eventful 2012-13Protecting environment

11|85


15/98

Inauguration of Rudolf Atul Chemicals Ltd by Padma Vibhushan Dr M.M. Sharma

Eventful 2012-13Building partnership

12|85


16/98

Inauguration of PI R&D by Padma Vibhushan Dr M.M. Sharma

Eventful 2012-13Fostering innovation

13|85


17/98

Commissioning of Anisole plantphase 1 Jun 12

Commissioning of 2,4-DCP plant Jun 12

Commissioning of 3,3-DDS plant Sep 12

Commissioning of BLR plant Sep 12

Completion of labour settlement-Valsad site (4.5 years) Sep 12

Completion of labour settlement-Ankleshwar site (6 years) Oct 12

Eventful 2012-13

14|85


18/98

IDG CIO 100

Eventful 2012-13

Information Week Silver EDGE

Enhancing capability

15|85


19/98

HR Leadership AwardWorld HR Congress

Eventful 2012-13

Shram Ratna AwardGovernment of Gujarat

Institutionalising processes

16|85


20/98

Eventful 2012-13

KIs No Impact

Yield 32 8

RMC 49 7

Solvent Reduction 36 2

Quality 13 0Utilities 46 4

Products from EEW 2 1

Effluent Reduction 19 1

Time cycle 26 6

Batch size 14 1

Productivity 11 1

Total 248 31

`cr

17|85

R


21/98

998

1159 1168

1508

1746

1964

500

1250

2000

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13

Revenues

`crPeriod CAGR1997-2002 9%

2002-2007 12%

2007-2012 15%

18|85


22/98

Profit before tax(from operations)

`cr

35

51

80

129116

187

25

60

95

130

165

200

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13

Period CAGR

1997-2002 15%

2002-2007 0%

2007-2012 40%

19|85

h i


23/98

Share price movement

0

250

500

2000-01 2002-03 2004-05 2006-07 2008-09 2010-11 2012-13

10,000 invested in 2000 has given 3,06,351 in 2012

CAGR 33%

`

Source : Capitaline

20|85

d i d


24/98

Industries Served

Aerospace Agriculture Automobile

ConstructionFlavour & Fragrance Paint & Coatings

Personal Care Pharmaceutical Textile

21|85


25/98

Financial Performance


26/98

Financials 2012-13

12-13A

11-12A

Inc | (dec) %

CY vs PY

Sales 1964 1746 12

Operating & other income 56 46 22

Total revenue 2020 1792 13

Material consumed 1143 1060 8

Employee benefit expenses 128 117 9

Other expenses 483 400 21

Exchange (gain) | loss 3 (12) -

EBIDTA 269 203 33

EBIDTA % 14 12 -

Interest 29 31 6

Interest AS-16 4 12 -

PBDT 233 172 35Depreciation 49 44 11

PBT before exceptional income 184 128 43

Exceptional income 5 6 (29)

P B T 192 122 57

P A T 136 88 55

RoCE % 21 17 -

cr

22|85

Q l l


27/98

Quarterly sales

404

447 444 451

496

537

440

491

350

400

450

500

550

600

Q1 Q2 Q3 Q4

2011-12 2012-13

cr

23|85


28/98

822 810 840939

1,044

11%13%

18%17%

21%

0%

5%

10%

15%

20%

25%

0

200

400

600

800

1000

1200

2008-09 2009-10 2010-11 2011-12 2012-13

Average capital employed # Return on average capital employed % # *

# Excluding capital work-in-progress * Excluding exceptional income| expenses

cr

Return on capital employed

24|85


29/98

Turnover per employee

2,746

2,5632,534

2,737 2,703

0.420.46

0.600.64

0.73

0.20

0.40

0.60

0.80

1.00

1.20

2,000

2,200

2,400

2,600

2,800

2008-09 2009-10 2010-11 2011-12 2012-13

Employees Turnover per employee

Head

count

c

r

25|85


30/98

578568

682

817895

9981159

1168

1508

17461964

500

1250

2000

Revenues

Last 5 years CAGR: 15%

`cr


26|85

P fit B f T


31/98

36

719 20 26

3551

80

129116

187

5

100

195

Profit Before Tax(from operations)

`cr



27|85

C i P fi bili


32/98

Comparative Profitability

Particulars 09-10A

10-11A

11-12A

12-13A

Sales 1168 1508 1746 1964

EBIDTA from operations before exchange diff 152 203 215 266

EBIDTA from operations before exchange diff 13% 13% 12% 14%

Exchange difference (9) (9) (12) 3

EBIDTA after exchange diff 142 194 203 269

EBIDTA from operations before exchange diff 12% 13% 12% 14%

Non recurring income | (expense) - 10 6 5

PBT 80 139 122 192

PAT 53 96 88 136

RoCE % 13 18 17 21

`cr

28|85

R ti


33/98

Ratios

Particulars 2012-13 2011-12

Debt|equity 0.47 0.60

Interest coverage 8.13 4.70

DSC 2.92 1.94

Current 1.4% 1.3%

EPS 45.69 29.70

29|85


34/98

Working Capital Management

W ki C it l


35/98

Working Capital

NoDs

Particulars Mar 13 Mar 12 Inc | (dec)

Inventories 56 58 (2)

Debtors 62 68 (6)

Other current assets 23 20 3

Gross Working Capital 141 146 (5)

Current liabilities 67 74 (7)

Net Working Capital 74 72 2

30|85

W ki C it l


36/98

Working Capital

Particulars Mar 13 Mar 12 Inc|(Dec)

Inventories 308 295 13

Debtors 361 368 (7)

Other current assets 123 104 19

Gross Working Capital 792 767 25

Current liabilities 363 375 (12)

Net Working Capital 429 392 37

` cr

31|85


37/98

Cash Flow and Borrowings

C h Fl f O ti


38/98

Cash Flow from Operations

2012-13 2011-12

Operating profit * 262 194

Inventories (13) (31)

Trade & other receivables (22) (80)

Creditors and other payables (6) 76

Cash generation from operations 221 159

Tax payments 53 38

Net cash flow from operating activities 168 121

* before WC changes and exchange difference on FCL

`cr

32|85

Fund Flow


39/98

Fund Flow

Sources 2012-13 2011-12

EBIDTA 266 215

Increase | (decrease) in borrowing (25) 60

Exchange rate difference 3 (12)

Exceptional income 5 7

Total 249 270

`cr

33|85

F d Fl


40/98

Fund Flow

Uses2012-13

A

2011-12

A

Interest and finance charges (net) 33 43

Purchase of fixed assets and capital advances 104 107

Working capital increase 37 18

Dividend payments 16 16

Direct taxes 56 34

Investment in group companies 4 42

Changes in non-current assets (1) 19

Total 249 270

`cr

34|85

P iti f b i


41/98

Mar

11

Mar

12

Mar

13

Rupee 202 233 262

Foreign Currency 113 142 88

Total 315 375 350

Long-term 156 183 196

Short-term 159 192 154

Total 315 375 350

Position of borrowingscr

317

375350

250

300

350

400

Mar-11 Mar-12 Mar-13

156183

196159

192

154

100

150

200

250

Mar-11 Mar-12 Mar-13

Long-term Short-term

35|85

B i g


42/98

Borrowings

349369

428

368

295315

375350

1.28 1.23

0.990.80

0.61 0.56 0.60

0.470.93

0.600.74 0.86

1.35

1.851.94

2.92

-

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

0

100

200

300

400

500

600

05-06 06-07 07-08 08-09 09-10 10-11 11-12 12-13

Debt Debt to equity DSCR

cr

36|85

Interest to Sales


43/98

10.0

8.0

6.4

4.2

3.43.7

3.3 3.3 3.5

2.21.7

2.4

1.7

0

2

4

6

8

10

00-01 01-02 02-03 03-04 04-05 05-06 06-07 07-08 08-09 09-10 10-11 11-12 12-13

Interest to Sales

%

37|85


44/98

Performance and Other ChemicalsAromatics

P


45/98

Purpose

AR Division will be a world-class business, offering its customers in

Personal Care and other chosen industries high quality products and

services in a cost effective manner.

38|85

User Industries


46/98

User Industries

Personal Care

Pharmaceutical

Flavors & Fragrance (F&F)

Dyestuff

Paper

No of Customers ~350

39|85

Key Products


47/98

Key Products

Product Group Market Share(2012-13)

Competition

p-Cresol 24% China (6)

p-AA 51% Europe (1), India (1)

p-AAl 65% India (2)

p-Cd 39% China (1)

40|85

Financials


48/98

Financials

cr

Particulars2010-11

A2011-12

A2012-13

A

Sales 349 469 658

No of people 197 226 234

41|85

Sales


49/98

Sales

349

469

658

300

485

670

10-11 11-12 12-13

cr

40% growth over previous year

42|85

W f d K A ti


50/98

Way forward - Key Actions

Maintain cost and volume leadership in existing products

Enter into value added downstream products

Explore related opportunities in Personal Care and F&F

43|85

Ri k


51/98

Risks

Chinese competition mainly in p-C and p-AA

Non compliance to REACH regulations

44|85


52/98

Performance and Other ChemicalsBulk Intermediates

Purpose


53/98

Purpose

BI Division will supply bulk chemicals to other Divisions in a cost

effective manner and grow in speciality chemicals and intermediates.

45|85

U I d t i


54/98

User Industries

Tyre and Rubber

Dyestuff

Paper

Pharmaceutical

No of Customers 264

46|85

Key Products


55/98

Key Products

Product Group Market Share

(2012-13)

Competition

Resorcinol 32% domestic Japan (2), USA (1),

China (8)

2% global

CSA 14% domestic India (6)

Oleum 65%, SO3,Caustic Soda

Captiveconsumption

47|85

Financials


56/98

Financials

cr

Particulars2010-11

A2011-12

A2012-13

A

Sales 98 108 123


48|85

Sales


57/98

Sales

98108

123

0

50

100

150

10-11 11-12 12-13

cr


49|85

Way forward Key Actions


58/98


Expand Resorcinol capacity

Enter into new intermediates3

Introduce products based on Hydrogen

50|85

Risks


59/98

Risks

60% of the Divisions business is commodity based and driven by

highly uncertain trends

Too many new players making business unviable

Increasing Chinese imports

51|85


60/98

Performance and Other ChemicalsColors

P rpose


61/98

Purpose

CO Division aims to be a reliable global supplier of colorants required

for different facets of human life. Its products will find applications

in industries such as textile, pharmaceutical, personal care, paper,

paint and coatings, packaging, foods and electronics.

It will manufacture in a responsible way and compete in the market

place on the basis of service, quality and cost and continuously

improve processes so as to deliver better value.

52|85

User Industries


62/98

User Industries

Product Group User Industries

Textile dyes Textile

Paper dyes Paper

HP pigments Paint and Coatings

No of Products 550

No of Customers 1350

2/553|85

Key Products


63/98

Key Products

Product GroupMarket Share

(2012-13)Competition

Vat dyes 12% Europe (1), China (4), India (1)

Reactive dyes 1.2% Europe (2), India (8-10)

Sulphur Black 8% Europe(1), China (3)

HP pigments 2.4% Europe (3)

54|85

Financials


64/98

Financials

Particulars2010-11

A2011-12

A2012-13

A

Sales 325 342 330


cr

55|85

Sales


65/98

325

342

330

250

300

350

10-11 11-12 12-13

cr

56|85



66/98

y y

Increase Vat dyes global market share through M Dohmen - Atul group

Capacity expansion of key Vat dyes

Increase Reactive dyes market share with specialities

Business growth through new High Performance Pigments and Digital

Printing Inks

Multiply business in Sulphur Black and grow in Denim segment

Expand synergistic businessTextile Chemicals through Rudolf Atul

Reduce fixed cost through restructuring

57|85

Risks


67/98

Risks

Reduced demand for niche products

Increased presence of SMEs in specialties on a global level

Limited product portfolio in High Performance Pigments

Minimal exposure to new synergistic business segments

58|85


68/98

Life Science ChemicalsCrop Protection

Purpose


69/98

Purpose

We, Crop Protection Division, are in the business of servicing thegrowing needs of food and fiber

We leverage our competency in chemistry and provide farmsolutions to create lush yields

We strive for building relationship with farmers across the globe

59|85

User Industries


70/98

CP brands are available across > 25000 retail outlets

Use dus es

User Industry Agriculture

No of products 59

No of customers 1945

Exports 150

Brand 1700

Bulk 95

60|85

Key Products


71/98

y

Product GroupMarket Share

(2012-13)Competition

2,4 D group 12%USA (1), Australia (1), South America

(1), Europe (1), China (3), India (7)

Indoxacarb 7% USA (1), India (1)

61|85

Financials


72/98

cr

Particulars2010-11

A2011-12

A2012-13

A

Sales 306 342 387


62|85

Sales


73/98

306

342

387

250

325

400

10-11 11-12 12-13

cr


63|85

Brands


74/98

Brands

64|85



75/98

Way forward Key Actions

Introduce new products coming off patent

Expand herbicide capacity

Expand brand business

65|85

Risks


76/98

Business is dependent on monsoon | weather and pest attack

Low price competitors from China

Competition from new entrants and low priced suppliers in domestic

herbicide business

Patent and data protectionIndia now is a signatory to IPR

Entry of international generics companies in India

Increased usage of GM crops

66|85


77/98

Life Science ChemicalsPharmaceuticals and Intermediates

Purpose


78/98

PI Division will contribute to the wellness of mankind by catering to the

growing needs of Pharmaceutical Industry. It will supply pharma

intermediates and APIs in a cost effective manner using novel

technologies.

67|85

User Industries


79/98


Pharmaceutical

Intermediate and APIsPharma

Phosgenated ChemicalsPharma, Polymers, Crop

Protection

SulfonesPharma, Aerospace, Electronics,

Polymers, Paper

No of Products 40

No of Customers 100

68|85

Key Products


80/98

Product Group Market Share(2012-13)

Competition

Pharmaceutical

Intermediates and APIs


81/98

cr

Particulars2010-11

A2011-12

A2012-13

A

Sales 95 106 114


70|85

Sales


82/98

95

106

114

90

120

10-11 11-12 12-13

cr


71|85



83/98

Sustainable Development approach

Expand capacity- Sulfones, Phosgene, Phosgenated &

Pharmaceutical intermediates

Improve production- Debottlenecking & Process Intensification.

Push sales in Japan & Europe

Growth through custom synthesis and contract manufacturing

Inorganic growth- acquisition

72|85

Risks


84/98

Forex fluctuation (70% exports)

New regulatory requirements in USA (GDUFA) and Europe

73|85


85/98

Performance and Other ChemicalsPolymers

Purpose


86/98

Purpose

PO Division will offer best in class products and services to Automotive,

Composites, Footwear, Furniture, Paint and Coatings and Civil industries

across the world with bonding and coating solutions in a cost effective

manner.

74|85

User Industries


87/98


Epoxy Paint & Coatings

Civil

Power Transmission

Wind energy

Defence

Automotive

Aerospace

No of Products 300

No of Direct Customers 500

75|85

User Industries


88/98


Brands Footwear

Handicrafts

Civil

Jewelry

Automotives

Furniture

Engineering

Art and Craft

No of Brands 24

No of Distributors 565

76|85

Key Products


89/98

Product Group

Market Share

(2012-13)

Domestic

Competition

Epoxy 18% USA (1), China (2),Fareast (3), India (1)

Brands 10% India (7)

77|85

Financials


90/98

cr

Particulars2010-11

A2011-12

A2012-13

A

Sales 364 406 386


78|85

Sales


91/98

cr

364

406386

200

305

410

10-11 11-12 12-13

79|85

Brands


92/98

80|85

Polygrip


93/98

81|85

WD-40


94/98

82|85

Atul-Elkay


95/98

83|85

Way forwardKey Actions


96/98

Increase sale of high margin products

Diversify and expand product portfolio

Add new business verticals of strategic importance

Expand brand business

Reduce cost and improve working capital cycle

Grow through Inorganic and Organic route

84|85

Risks


97/98

Price and margin sensitive business

Growth depends on Infrastructure development

Limited ability to pass the price increases

85|85


98/98

Thank You

atul presentation

Documents