gail investor presentation nov09
TRANSCRIPT
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This presentation has been prepared by GAIL (India) Ltd (Company or GAIL)solely for providing information about the Company.
The information contained in this presentation is only current as of its date. Certain
statements made in this presentation may not be based on historical informationor facts and may be "forward-looking statements", including those relating to theCompanys general business plans and strategy, its future financial condition andgrowth prospects, and future developments in its industry and its competitive andregulatory environment. Actual results may differ materially from these forward-
looking statements due to a number of factors, including future changes ordevelopments in the Companys business, its competitive environment,information technology and political, economic, legal and social conditions inIndia.
This communication is for general information purposes only, without regard tospecific objectives, financial situations and needs of any particular person.Company do not accept any liability whatsoever, direct or indirect, that may arisefrom the use of the information herein.
The Company may alter, modify or otherwise change in any manner the content of
this presentation, without obligation to notify any person of such revision orchanges.
Safe Harbor Statement
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GAIL Management
Sh B C TripathiChairman & Managing Director
Sh R K GoelDirector (Fin)
Sh R D GoyalDirector (Proj)
Sh S L RainaDirector (HR)
Functional Directors
Sh Sundareshan Sh Apurva
ChandraDr. Vinayshil
GautamDr. U K Sen Sh R M Sethi
Government Nominee / Independent Directors
Prof. A.Q.
Contractor
Sh Mahesh
Shah
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Quick Facts
Indias Premier Integrated Natural Gas
Company since 1984
Years of Experience & Expertise in Gas P/L25+Baa2/A3 Moodys Foreign/Domestic Rating
ICRA & CRISIL for Bond IssueAAAGoI Stake57%+10 Years Turnover CAGR15%+10 Years PAT CAGR10%+Manpower Asset3500+
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Quick Facts
Indias Premier Integrated Natural Gas
Company since 1984
Gas Transmission Cap150 MMSCMD+1.3+ MMTLHC Production Capacity
Polymer Production Capacity410+ TMTE&P/CBM Blocks30
: 100% Subsidiary2Presence in Countries4
: JVs/Associate Companies12
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Shareholding Pattern
Government of India (GoI)is GAILs controlling shareholder
The administrative ministry for the purpose of the company is the Ministry ofPetroleum & Natural Gas, GoI
GoI has no plans to reduce its shareholding in GAIL to below 51%.
President of India 57.34%
ONGC 4.83%
IOC 2.42%
Life Insurance Corporation 5.42%
LIC of India Money Plus 1.79%
TOTAL 71.80%57.34
5.01
7.24
12.13
13.79
3.411.43
GoI M F/UTI/FI/Ba nk CG/SG Insura nc e FII GDR Other s
Shareholding PatternShareholding Pattern
as on 30.09.09as on 30.09.09Shareholders >1% + shareShareholders >1% + share
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Financial Overview
10000
12000
14000
16000
18000
20000
22000
24000
26000
Turnover CAGR of 15%
1750
2000
2250
2500
2750
PAT CAGR of 10%
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Business Portfolio
NG Transmission
E&P
Petrochemicals
NG Trading
Retail
Liquid Hydrocarbons
GAILTEL Diversification
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1,266
1,469
H1 08-09 H1 09-10
Segmental Physical Performance H1 FY 2009-10
Gas Transmission
83.08
101.66
H1 08-09 H1 09-10
MMSCMD
22%
Gas Trading
79.43 80.50
H1 08-09 H1 09-10
MMSCMD
16%
LPG Transmission
000 MT
Petrochemicals
179 180
H1 08-09 H1 09-10
000 MT
1%
Liquid HC
552
547
H1 08-09 H1 09-10
000 MT
(1%)
OLHC
155
166
H1 08-09 H1 09-10
000 MT
7%
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Financial Performance H1 FY 2009-10
(Rs in Crores)
Sales (Net of ED)
11,860 12,224
7,500
8,750
10,000
11,250
12,500
H1 08-09 H1 09-10
3%
Gross Margin (EBITDA)
3,175
2,332
2,000
2,250
2,500
2,750
3,000
3,250
H1 08-09 H1 09-10
(27%)
PBT
2,855
2,014
1,500
1,750
2,000
2,250
2,500
2,750
3,000
H1 08-09 H1 09-10
(29%)
PAT
1,920
1,369
1,000
1,250
1,500
1,750
2,000
2,250
H1 08-09 H1 09-10
(29%)
LPG Subsidy in H1 FY 09-10: Rs.533 Cr (Rs.876 Crs. in H1 FY 08-09)
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Gas Transmission Segment
1,093
1,443
H1 08-09 H1 09-10
935
1,266
H1 08-09 H1 09-10
Turnover
32%
EBITDA
35%
(Rs in Cr)
Core Business NG Trans Cap ~ 150 MMSCMD (7000 KM)
12%
53%
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Gas Trading Segment
7,267
8,109
H1 08-09 H1 09-10
208217
H1 08-09 H1 09-10
Turnover
12%
EBITDA
4%
(Rs in Cr)
Core Business Earning of Marketing Margin by Natural Gas Trading
66%
9%
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LPG Transmission Segment
131
162
H1 08-09 H1 09-10
Turnover
EBITDA
24%
(Rs in Cr)
Core Business LPG Trans Cap ~ 3.6 MMTPA (1900 KM)
2%
7%
175
208
H1 08-09 H1 09-10
19%
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Petrochemical Segment
1,413
1,234
H1 08-09 H1 09-10
836
620
H1 08-09 H1 09-10
Turnover
(13%)
EBITDA
(26%)
(Rs in Cr)
Only Plant in North India Polymer Capacity ~ 410 KTPA
Drop in Turnover & EBITDA due to lower Product Prices
10%
26%
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Liquid Hydrocarbon Segment
1,864
1,199
H1 08-09 H1 09-10
929
121
H1 08-09 H1 09-10
Turnover
(36%)
EBITDA
(87%)
(Rs in Cr)
10%
5%
7 Plants across India Liquid Hydrocarbon Capacity ~ 1.3 MMTPA
Drop in Turnover & EBITDA due to lower Product Prices
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Corporate Mission & Vision
VISIONVISION
Be the leading company in natural gasBe the leading company in natural gas
and beyond with global focus,and beyond with global focus,committed to customer care, valuecommitted to customer care, value
creation for all stakeholders andcreation for all stakeholders and
environment responsibilityenvironment responsibility
MISSIONMISSION
To accelerate and optimise the effectiveTo accelerate and optimise the effective
and economic use of Natural Gas andand economic use of Natural Gas and
its fractions to the benefit of theits fractions to the benefit of the
national economynational economy
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GAIL Strategy Implementation
City Gas,Power, Telecom
Gas Processing
Petrochemicals
Marketing,Trans., Cross
Country P/L
E&P
LNG Import
Domestic
Source
Move
U
pstream
Core
B
usiness
Diversifica
tion
Inte
rnationalOp
portunity
Upstream
Trans-
mission
MidStream
Retail&
d
iversify
1
2
3
4
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Gas Demand Supply Assessment
(In MMSCMD)
Sector wise Gas Demand Projection
280226Total
87Sponge iron/Steel
3329Petrochemicals/Refineries/InternalConsumption
2017Industrial
1614City Gas / CNG
7656Fertilizer
127103Power
2011-122009-10SectorSource wise Gas Supply Projection
191168Total Gas Supply (A+B+C)
8353Total LNG Supply (C)
108115Projected Domestic Supply
(A+B)
5760Pvt./ JVs (As Per DGH) (B)
5155ONGC+OIL (A)
11-122009-10Sources
Source: As per working Group Report for XIth Plan of Planning Commission (November 2006)
Large Demand Supply Gap - Opportunity for Growth.
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GAIL Existing Infrastructure
GAS PIPELINES
7200 KMS
(150 MMSCMD)
GAND
HARVAGHODIA
USAR
VIJAIPUR
LAKWA
TRIPURA
KG BASIN
VSPL
CAUVERYBASIN
HVJ,DVP
L
JLPL
RAJASTHAN
NATURAL GAS PIPELINE
LPG PIPELINE
PATA
PETROCHEM PLANT
LPG PLANT
LPG PIPELINES
1900 KMS
(3.6 MMTPA)
GAS PROCESSING
7 Plants
(1.3 MMTPA LPG)
PETROCHEMICALS
410,000 TPA
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GAIL Capacity Built-up
72207663
9272
11132
13825
6000
7000
8000
9000
10000
11000
12000
13000
14000
15000
Existing
Length
2009-10 2010-11 2011-12 2012-13
12524Mumbai
7220142TOTAL
206949Others
79312DUPL/DPPL
HVJ/DVPL
P/L
57
Cap
4233
Lnth
(Existing Network)
610---78610---DVPL-II
501----59531--Dadri Baw. Nangal
1389138916------Dabhol Bangalore
1114111416------Kochi-Mang/ Bangalore
1860
1860
-
-
Length
16
35
40
Cap.
2011-12
2693
190
-
-
Length
16
-
-
Cap.
2012-13 Total
66051609443TOTAL
2009-10 2010-11
Additional Infrastructure as per approved schedule
2050----Jagdishpur Haldia
443--44312Chain. Jhajjar
-
Length
-
Cap.
VDPL
Pipelines
498
Length
40
Cap.
498
Length
(Length in KM)
(Length in KM)/(Capacity in MMSCMD)
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Projected Capex Rs.49155 Cr
0
2,500
5,000
7,500
10,000
12,500
15,000
17,500
2009-10 2010-11 2011-12 2012-13 2013-14
Pipeline E&P Others
5687
7639
16385
% share of Capex
70%
10%
20%
GAIL has a history of Excellent Project Management :
to execute the Project within given time frame and without cost over run
14864
4580
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Projected Borrowings Rs.28700 Cr
1,200
4,500
12,500
10500
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
2009-10 2010-11 2011-12 2012-13
Aggressive Capex Plan calls for Borrowings
Leverage on GAILs current very low debt Equity ratio (0.08:1)
40%
32%4%
3%
21%
INR Bonds Term Loan OIDB
ECA FC Loan
Borrowing Portfolio
76%
24%
INR Loan FC Loan
Borrowing Portfolio (INR Vs FC)
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E&P Activities - Secure Future GasSupplies
Total Blocks - 30 Onshore Blocks - 9
Offshore Blocks - Deep 13 & Shallow - 5 CBM Blocks - 3 (Under coring)
Major Operators - ONGC, GSPC, OIL,GSPC, Oilex, Daweoo,Pertogas, Hardy, Eni,Jubilent, Arrow Energy
Net investment - Rs.1828 Cr (upto 30.06.09)
HC Discoveries - Made in 8 Blocks :Cambay onland, A1& A3blocks (Myanmar),Cauvery offshore &onland, Mahanandioffshore, Ankleshwaronland, Block 56 (Oman)
Operating 2 onland blocks RJ-ONN-2004/1(NELPVI) & CY-ONN- 2005/1 (NELP VII)
Commercial Block - Crude oil from Cambay
Basin
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GAILs Future
Emerging as a Strong NG Trans Companywith diversified portfolio
No ofCities
Nos.
MMT
MMSCMD
KM
Unit
~14000~7000NG Trans Pipeline
~5015Retail Gas Presence
3
(5 in FY 13-14)
1E&P RevenueGenerating Blocks
~8~4Polymer Capacity(incl BCPL)
~300~150NG Trans Capacity
FY 2012-13FY 2008-09
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Immediate Growth Drivers from FY 09-10onwards
Additional Gas availability:
RIL KG Basin gas from Q1 09-10 onwards
PLL - RLNG from Q4 09-10 onwards
Dabhol RLNG from Q4 09-10 onwards
ONGC Natural Gas Supply from marginal fields
FOCUS ENERGY Natural Gas Supply from Rajasthan field
Spot LNG ongoing basis
Enhanced Pata Petrochemical Production from Q1 of FY 10-11onwards
Upside in Polymer Product Prices
Lower Subsidy expected as compared to FY 08-09 due tosoftening of Crude oil prices
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Most Recent Laurels
Oil Industry Safety Award - 1st rank under Other Processing Plant category
Dahej-Panvel-Dabhol pipeline project awarded 3rd position in IPMA projectexcellence award 2009
Oil and Gas Transportation Company for the year 2007-08 by Petrofed
Safety Innovation Award 2008 for excellence in innovative safety measures
Ranked 2nd among gas utilities in Asia in the Platts Global Ranking of EnergyCompanies.
Top Indian company in the Gas-Processing, Distribution and Marketing Sectorfor the Dun & Bradstreet Corporate Rolta Corporate Awards 2008.
Most Diversified PSU in the country from Dalal Street Investment Journal.
Ranked among the Forbes 2000 companies.
Amity Award for excellence in Human Resources.
National Award for Excellence in Cost Management from The Institute of Costand Works Accountants of India (ICWAI)
International Safety award from British Safety Council
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Conclusion
Dominant Position - Transmission
Large Capex Plans in Place
Relatively New Asset
Strong Gas Demand
Strong Financials
Strong GoI Support
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Thank You