In continuation with the Company���s letter dated May 19, 2022 pertaining to Intimation of schedule of Earnings call to be held on Friday, 27th May 2022 at 10:00 a.m. (IST) and pursuant to Regulation ...
May 26, 2022
To,
National Stock Exchange of India Limited Exchange Plaza, 5th Floor, Plot No. C/1, G Block, Bandra – Kurla Complex, Bandra (E), Mumbai -400 051
BSE Limited Corporate Relationship Department, 2nd Floor, New Trading Wing, Rotunda Building, P.J. Towers, Dalal Street, Mumbai – 400 001
Symbol: SJS
ISIN: INE284S01014
Dear Sir/Madam,
Scrip Code: 543387
Subject: Earnings Call Presentation of the Company pertaining to quarter and year ended 31st March 2022
In continuation with the Company’s letter dated May 19, 2022 pertaining to Intimation of schedule of Earnings call to be held on Friday, 27th May 2022 at 10:00 a.m. (IST) and pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, please find enclosed herewith the earnings presentation on the Audited Financial Results of the Company for the quarter and year ended 31st March 2022.
Also, this presentation will be uploaded on the website of the Company at https://www.sjsindia.com/
Request you to kindly take the above on record.
Thank you,
Yours faithfully, For S.J.S. Enterprises Limited
Thabraz Hushain W. Company Secretary & Compliance Officer Membership No.: A51119
Encl: As mentioned above
S.J.S ENTERPRISES LIMITED
Q4FY22 EARNINGS PRESENTATION
Disclaimer
Certain statements made in this presentation relating to the Company’s objectives, projections, outlook, expectations, estimates, among others may constitute ‘forward- looking statements’ within the meaning of applicable laws and regulations. Actual results may differ from such expectations, projections etc., whether express or implied. These forward-looking statements are based on various assumptions, expectations and other factors which are not limited to, risk and uncertainties regarding fluctuations in earnings, competitive intensity, pricing environment in the market, economic conditions affecting demand and supply, change in input costs, ability to maintain and manage key customer relationships and supply chain sources, new or changed priorities of trade, significant changes in political stability in India and globally, government regulations and taxation, climatic conditions, natural calamity, commodity price fluctuations, currency rate fluctuations, litigation among others over which the Company does not have any direct control. These factors may affect our ability to successfully implement our business strategy. The company cannot, therefore, guarantee that the ‘forward-looking’ statements made herein shall be realized. The Company, may alter, amend, modify or make necessary corrective changes in any manner to any such forward looking statement contained herein or make written or oral forward-looking statements as may be required from time to time on the basis of subsequent developments and events
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Today’s Presenters
K A JOSEPH Managing Director
SANJAY THAPAR Executive Director & CEO
SAUMYA MOGANTY VP - Finance
DEVANSHI DHRUVA Head–Investor Relations
• Founded the company in
1987
• More than 34 years of
experience in aesthetics printing business
• Post graduate diploma in business administration from the St. Joseph’s College of Business Administration, Bangalore; B.Sc from Bangalore University
• Over 30 years of experience in the automotive industry
• Previously worked with
Ashok Minda Group, Minda Valeo Security Systems, Minda HUF Limited, Tata Engineering and Locomotive Company Limited (now known as Tata Motors Limited)
• Bachelor’s degree in science (mechanical engineering) from the Delhi College of Engineering
• Over 21 years of work experience in finance function
• Previously worked in audit and IT industry; currently heading finance function at SJS since 2011.
• Associate of the Institute of Chartered Accountants of India; B.Com (Honours) from Utkal University, Odisha
• Previously worked with Westlife Development Limited (McDonald’s India) and Piramal Enterprises Limited managing Investor Relations and earlier as Equity Research Analyst with Dolat Capital Markets Pvt. Ltd.
• PGDM – Finance from K J
Somaiya Institute; M.Com & B.Com (Accounting & Finance) from University of Mumbai
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About SJS Enterprises
S.J.S Enterprises Limited : A Snapshot
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One of the leading players in Indian decorative aesthetics industry which has faster than underlying industry growth (1)
Rs 3,698.6 Mn FY22 Revenue (2)
FY21-FY26 CAGR (1)
20%
10-12%
11-13%
12-14%
11 product categories (3); Added chrome plated parts to portfolio
7 End markets served(4) – 2W, PV, CD, CV, Medical devices, Farm equipment & Sanitary ware
2W
PV
CD
Aesthetics
Widest range of products(5) with presence across traditional and premium products
2
3
“”Design” to delivery” aesthetics solution provider
Design
Development
Delivery
15 days to 6 months
~123 Mn Total parts supplied
~6,000 SKUs
20 Countries exported to
Strong manufacturing footprint and global distribution capabilities
4
5
Long-standing customer relationships
~175+ Customer Locations (as on 31st Mar 2022)
~15 yrs Average length of relationship with 10 largest customers
Note: (1) as per CRISIL Research ; (2) Consolidated revenue from operations; (3) Decals, 2D/ 3D appliques and dials, 3D lux badges, domes, overlays, aluminium badges, IML/IMDs, lens mask assembly, optical plastics and chrome-plated plastic parts; (4) 2W- Two Wheeler; PV – Passenger Vehicle; CD – Consumer Durables; CV: Commercial Vehicles; (5) As on Mar 31, 2021 as per CRISIL Research
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SJS Outperformed Auto Industry
Q4FY22 - Industry Production Volume1 v/s SJS YoY Sales2
Industry SJS
(5.3%)
(21.0%)
52.3%
2.0%
12.1%
(17.4%)
9.4%
+
FY22 - Industry Production Volume1 v/s SJS YoY Sales2
Industry SJS
32.1%
4.6%
(3.5%)
19.2%
15.5%
14.1%
(0.2%)
+
Note: 1) Industry Production Volumes are production in India; 2) For SJS YoY Sales, Q4FY21 are Proforma numbers and Q4FY22 are Consolidated numbers
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Diversification strategy playing out well
Revenue (By End Segment %) 1.2
Revenue (By Geography)1.2
FY19 (SA)
FY21 (SA)
FY22 (Con)
70.1
58.0
43.3
28.8
25.0
22.2
19.6
16.6
10.2
5.7
0.4
0.1
FY19 (SA)
FY21 (SA)
FY22 (Con)
3,231
2,140
2,108
(INR Mn)
469
408
233
2W
PV
CD
Others
Domestic
Exports
PV revenue grew over 4x & CD grew 1.8x of FY19 on back of organic and inorganic growth
Exports Revenue doubled in 3 years (FY22 Exports was only from SJS as Exotech was only domestic business)
New Age Products contribution to revenue has increased from <3% in FY19 to 16%+ in FY22
Note: 1) Percentages rounded up to one decimal place; 2) Revenue split for FY19 and FY21 is for SJS standalone and FY22 is on Consolidated numbers
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Q4FY22 Business & Financial Highlights
Q4FY22 Financial Performance (Consolidated)
Revenue at Rs 1,041 mn, growth of ~13.4% QoQ, v/s overall 2W & PV industry productions combined was flattish QoQ to 2% growth
EBITDA at Rs 267 mn, impacted by RM inflation, but downside was limited on back of operational efficiencies; Strong margins of 25.3%
Net Profit at Rs 154 Mn, on a margin of 14.6%
Strong 20%+ QoQ Revenue growth in Passenger Vehicle as well as Consumer Durables segments
Domestic business clocked 16%+ QoQ Revenue growth on account of new business wins
Strong Cash & Bank Balance position with over Rs 100 crs on Balance sheet
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Q4FY22 Business Highlights
Key Customer Addition
Honda Award for New Product Development at their Annual Supplier Conference
Key Business Projects Won
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FY22 Financial Highlights
Financial performance……(1/2)
Revenue from operations (INR Mn)
EBITDA (INR Mn) & EBITDA Margin %
PAT (INR Mn) & PAT Margin %
FY21 Adj EBITDA2 – Rs 879.6 Mn Adj EBITDA Margin2 % - 27.1%
FY21 Adj PAT2 – Rs 475.8 Mn Adj PAT Margin2 % - 14.7%
3,698.5
SJS SJS + Exotech
SJS SJS + Exotech
3,201.4
31.0%
31.2%
31.5%
2,516.2
2,372.5
2,161.7
26.7%
686.1
643.2
28.3%
985.3
18.7%
18.7%
797.0
935.4
26.3%
15.6%
477.7
519.8
19.4%
550.2
412.9
376.0
15.7% 14.7%
FY19
FY20
FY21
FY21 Proforma
1
FY22
FY19
FY20
FY21
FY21 Proforma
1
FY22
FY19
FY20
FY21
FY21 Proforma
1
FY22
SJS
SJS + Exotech
SJS
SJS + Exotech
SJS
SJS + Exotech
Source: 1) FY21 Proforma numbers onwards it is Consolidated financials (including Exotech financial performance); 2) FY21 Adjusted numbers are excluding exceptional item of gain on sale of land of Rs 53.83 mn (Pre tax)
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Financial performance……(2/2)
ROCE & ROE (in %)
FCFF (INR Mn)
ROCE
ROE
FY21 Adj ROCE2 – 24.8% Adj ROE2 - 15.1%
28.3%
26.4%
31.6%
26.8%
27.1%
15.8%
14.8%
15.2%
16.5%
15.3%
Capex for New Manufacturing Facility
367.4
FY21 Adj FCFF2 – Rs 591.5 Mn
Exotech Acquisition
635.5
500.3
456.4
FY19
FY20
SJS
FY21
FY21 Proforma
1
FY22
-73.3
FY19
FY20
FY21
FY21 Proforma
1
FY22
SJS + Exotech
SJS
SJS + Exotech
FCFF to EBITDA & FCFF to PAT
FCFF to EBITDA
FCFF to PAT
FY21 Adj FCFF to EBITDA2 – 67.1% Adj FCFF to PAT2 – 124.3%
Net Debt to Equity (x)
SJS
FY20
SJS + Exotech
FY21
1 FY21 Proforma
FY22
95.6%
57.3%
122.3%
67.9%
90.9%
50.8%
FY19
-0.15
-11.4%
-19.5%
FY19
89.0%
53.6%
FY20
SJS
FY21
FY21 Proforma
1
FY22
-0.27
SJS + Exotech
-0.35
Note: 1) FY21 Proforma & FY22 numbers are Consolidated financials (including Exotech financial performance); 2) FY21 Adjusted numbers are excluding exceptional item of gain on sale of land of Rs 53.83 mn (Pre tax)
-0.17
-0.25
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P&L Statement (Consolidated)
AUDITED PROFIT & LOSS STATEMENT FOR THE PERIOD ENDED 31ST MARCH 2022
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For the year ended31.03.2022 31.12.2021 31 March 2022IncomeRevenue from operations 1,041.1 917.9 3,698.6 Other income12.4 9.2 41.6 Total income1,053.5 927.1 3,740.2 ExpensesCost of raw materials consumed 465.3 381.1 1,590.9 Changes in inventory of finished goods, work-in-progress and stores and spares 7.4 (6.0)(0.1) Employee benefits expense132.1 119.5 510.4 Other expenses181.7 168.1 653.7 Total expenses786.6 662.8 2,754.8 EBITDA266.9 264.3 985.3 EBITDA Margin %25.3%28.5%26.3%Finance costs7.7 7.4 30.2 Depreciation and amortization expense54.1 54.4 215.7 Profit before tax205.2 202.5 739.4 Tax expensesCurrent tax55.8 47.0 204.4 Deferred tax (credit)/charge (4.2) 6.5 (15.2) Total tax expense 51.6 53.5 189.2 Profit for the year153.6 148.9 550.2 PAT Margin %14.6%16.1%14.7%Quarter EndedParticulars (INR Mn) Balance Sheet (Consolidated)
STATEMENT OF AUDITED ASSETS AND LIABILITIES AS AT 31ST MARCH 2022
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As at31.03.2022AASSETS1.Non-Current Assets(a) Property, Plant and Equipment1,525.7 (b) Capital Work in Progress1.9 (c) Intangible Assets66.6 (d) Right-of-use assets191.6 (e) Goodwill289.3 (f) Financial Assets(i) Other Non Current Financial Assets19.7 (g) Income Tax Assets (Net)18.5 (h) Deferred Tax Assets (Net)15.6 (i) Other Non Current Assets61.3 Total Non Current Assets2,190.2 2.Current Assets(a) Inventories415.5 (b) Financial Assets(i) Investments784.4 (ii) Trade Receivables858.0 (iii) Cash and Cash Equivalents159.5 (iv) Bank balances other than Cash and cash equivalents65.2 (v) Loans3.3 (vi) Other Financial Assets43.5 (c) Other Current Assets56.5 (e) Assets held for Sale- Total Current Assets2,386.0 TOTAL ASSETS4,576.2 PARTICULARS (INR Mn)As at31.03.2022BEQUITY AND LIABILITIES1.EQUITY(a) Equity Share Capital304.4 (b) Other Equity3,300.3 Total Equity3,604.7 2.LIABILITIESNon Current Liabilities(a) Financial Liabilities(i) Lease liabilities140.8 (b) Deferred Tax Liabilities (Net)100.0 Total Non Current Liabilities240.9 3.Current Liabilities(a) Financial Liabilities(i) Borrowings125.9 (ii) Lease liabilities27.8 (iii) Trade PayablesTotal Outstanding due of Micro Enterprises & Small Enterprises150.4 Total outstanding due of Creditors other than Micro Enterprises & Small Enterprises157.8 (iv) Other Financial Liabilities171.1 (b) Income tax liability (net)47.9 (c) Other Current Liabilities41.6 (d) Provisions8.2 Total Current Liabilities730.6 Total Liabilities971.5 TOTAL EQUITY AND LIABILITIES4,576.2 PARTICULARS (INR Mn) Outlook: FY23–25 (Medium Term) FY23 (Near Term)
SJS – Outlook for FY23 - 25…(1/3)
1
Organic growth expected at ~25% CAGR, maintaining best in class margins
Capacity Expansion: Expand chrome plating capacity to meet higher demand pipeline • Double the chrome plating capacity to support revenues of Rs 300 Crs from the current Rs 130 Crs
• Expect capex of ~Rs 100 Crs (spread over 18-24 months) to be funded internally through SJS cash flows and
target ROCE of ~20%
• Higher capacity will also enable entry into global markets
Exports : Increasing global presence •
Increase presence in existing geographies and enter new geographies by leveraging strong customer relationships
• Strengthening our sales force in the international markets of Turkey, Brazil & Argentina and exploring similar
opportunities in other countries
Products : Focus on development of new technologies & advanced products •
Intend to develop and introduce Illuminated logos, In Moulded Electronic (IME) parts and other new gen technologies
• Continue to build capabilities to innovate & develop new products & increase application of products across industries
Key Customers : Growing mega accounts • Strengthen relationships with existing customers by expanding the array of products & building large mega accounts
•
Increase customer base by marketing existing products to new customers
• Cross selling opportunities between SJS and Exotech
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SJS – Outlook for FY23 - 25…(2/3)
2
Merger & Acquisitions
SJS successfully integrated Exotech business and demonstrated credible business improvement in Exotech’s FY22 performance:
• ~50% YoY growth in
Revenue, increasing from Rs 685 Mn to Rs 1,020 Mn
• Cost synergies & efficiency resulted in Exotech EBITDA margin expansion by 150+ bps YoY from 11.3% in FY211 to 12.8% in FY22
SJS will continue ahead with more business accretive acquisitions & the rationale for it will be:
Build capability in adjacent / new aesthetic product categories Identified key product categories to enter / expand presence which include: • • •
IMD / IML IME (In-Mould Electronics) Plastic injection moulding
Expand presence in consumer related industries Enter new segments and expand presence in other consumer related industries targeting • Appliance manufacturers • Hand held devices
Enter new geographies / OEMs for chrome plating • Expand presence in chrome plating (largest
segment) and increase cross selling opportunities
• Overcome logistics cost as bulky parts • Provides direct entry into OEMs to support cross
selling opportunities
SJS Management is actively evaluating opportunities and building an M&A pipeline to give an impetus to revenue growth over and above the organic growth of ~25%
Note: 1) FY21 EBITDA Margins is excluding one time gain on sale of land to the extent of Rs 53.83 Mn
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SJS – Outlook for FY23 - 25…(3/3)
3
Future Leadership
Management plans to strengthen SJS’ senior leadership team given the business plans for both organic and inorganic growth
New CEO
•
•
Lead all business activities required to deliver on future guidance
Joseph and Sanjay to continue to play executive leadership roles focussing on strategy, new product pipeline, merger integration and enhancing future growth potential of the business
New CFO
• To lead the finance function for the group and deliver on all stipulated financial requirements.
• CFO will also lead financial integration of future targets
Actively seeking to hire CEO and CFO to implement our strong business growth strategy
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SJS – FY23 Outlook
End Segments
FY22 Industry Domestic Vol Growth
FY23E Industry Domestic Vol Growth
Contribution to SJS Revenue
Two Wheelers
Passenger Vehicle
(10.9%)
13.2%
15.6%
19.0%
43.3%
28.8%
❖ SJS expects ~25% YoY revenue growth on account of expected positive outlook
for 2W, PV and Consumer Durables
o Premiumisation + New Customer Wins + Exports = Higher sales growth for
SJS than industry
o High Visibility: Current order book to be executed in FY23 is ~80-85% of
FY23 forecasted revenue
❖ Strong moat, strong margin profile and expected operating leverage to drive PAT
growth of ~30% YoY and going ahead
Note: Industry growth is domestic sales volumes; FY23E Industry Domestic Vol growth broker reports & market research
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THANK YOU
IR Contact Ms. Devanshi Dhruva | Head - Investor Relations devanshi@sjsindia.com
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