VIP Industries Limited has informed the Exchange about Investor Presentation
BSE Limited Phiroze Jeejeebhoy Towers, Dalal St, Kala Ghoda, Fort, Mumbai – 400 001.
Code No. 507880
25th January, 2023
National Stock Exchange of India Ltd. Exchange Plaza, 5th Floor, Plot No. C/1, G Block, Bandra Kurla Complex, Bandra (East), Mumbai – 400 051. Code – VIPIND
Subject: Presentations made/being made to analysts / institutional investors
Dear Sir/Madam,
Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, please find enclosed herewith presentation being made by the Company to the analysts/ institutional investors.
Kindly take the same on record.
Thanking you,
Yours faithfully,
For V.I.P. Industries Limited
Anand Daga Company Secretary & Head – Legal
Encl. As above
Registered Office: DGP House, 5th Floor, 88C, Old Prabhadevi Road, Mumbai 400 025. INDIA. TEL: +91 (22) 66539000 FAX: +91 (22) 66539089, EMAIL: corpcomm@vipbags.com WEB: www.vipbags.com CIN - L25200MH1968PLC013914
INVESTOR PRESENTATION Q3 & YTD FY23
Disclaimer
Some of the statements in this communication may be forward looking statements within the meaning of applicable laws and regulations. Actual results might differ substantially from those expressed or implied. Important developments that could affect the Company’s operations include changes in the industry structure, significant changes in political and economic environment in India and overseas, tax laws, import duties, litigation and labour relations.
The information contained herein has been prepared to assist prospective investors in making their own evaluation of the Company and does not purport to be all-inclusive or to contain all of the information a prospective or existing investor may desire. In all cases, interested parties should conduct their own research/investigation and analysis of the Company and the data set forth in this information. The Company makes no representation or warranty as to the accuracy or completeness of this information and shall not have any liability for any representations (expressed or implied) regarding information contained in, or for any omissions from, this information or any other written or oral communications transmitted to the recipient in the course of its evaluation of the Company.
While we have made every attempt to ensure that the information contained in this presentation has been obtained from reliable source, the Company is not responsible for any errors or omissions, or for the results from the use of this information. All information in this presentation is provided on "as is" basis with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information and without warranty of any kind, express or implies including but not limited to warranties of performance for a particular purpose. In no event will the Company its Directors, legal representatives, agents or employees thereof be liable to anyone for any decision made or action taken by relying on data/information in this Presentation.
Index
Industry Overview
Company Overview
Q3 Financial Performance
Brands, Channels & Categories
Industry Overview
Industry Overview
The luggage & backpacks market in India is estimated to be around ~Rs. 10,000 crore1 with branded players constituting ~56%1&2 of the market
Favorable Demographics
• Rising middle class and its increased propensity to spend will drive discretionary spend industries
Changing Attitude Towards Travel
• Frequency jump in
travel turning luggage into lifestyle products
Growing Customer Cohorts
• Luggage is extending to
customer cohorts beyond travel driven by event-based consumption
Source: 1. Euromonitor, estimated for Calendar year 2022; 2. Internal estimates
Shift from Unorganized to Organized
• Macro pressures
coupled with customer preference shift towards branded products fueling growth for organized sector
Growing Middle India And Its Increasing Propensity To Indulge Will Further Accelerate The Industry Growth
India is projected to house the world’s largest middle class consumer market, surpassing China and the US
Ballooning middle class consisting of ‘connected aspirants’ will form majority of India’s demography going forward
Spending By The Global Middle Class
Source: "The Emerging Middle Class in Developing Countries", Homi Kharas, OECD Development Centre
Changing Attitudes Towards Travel Inducing Shorter Replacement Cycles In Luggage Industry
Category Core : Durability with additional features for convenience ▪ 2-3 Travel Occasions ▪ Business Travel emerges a new
cohort
▪ Two Bags in the Family ▪ One for Official Travel & One for
Family
▪ Mode of transports:
▪ Train/Bus/Limited Air Travel
▪ Replacement : 5-7 yrs
2
2000
Flaunt / Expression will be key Category core
▪ Multiple travel occasions with
increasing trend of international travel, weekend getaways, solo trips etc.
▪ Repertoire of Bags per person ▪ Mode of travel
▪ Domestic & International Air
/Car Trips / Train / Bus
▪ Replacement : 2-3 years
2010
3
4
Category Core moves to Convenience ▪ One Bag for each individual ▪ Mode of transport
▪ Domestic Air /Car Trips /
Train / Bus ▪ Replacement : 3-5 years
2015-2022
1990
1
Category Core : Durability ▪ One Travel a year
▪ Meet Relatives, Location Transfer, Marriage etc.
▪ One Bag for the Family ▪ Mode of transport
▪ Train/Bus Travel
▪ Replacement : 8-10 years
Source : Research commissioned by VIP Industries, Conducted by The Third Eye consulting & research firm
Consumer Cohorts Extending Beyond Travel
• Expenditure on weddings had been on the rise in India and as per industry estimates it has gotten bigger post pandemic2 • Luggage is an integral part of Wedding Shopping
I
S G N D D E W
• Departures from India for International Education has grown at a CAGR of 19% for 5 years ended 20211 • A Similar trend is expected to continue
• Luggage as a preferred personal gifting item is emerging as a significant trend • Major retail chains now operating regular promotional gifting of luggage category
S N O I T O M O R P & G N I T F I G
L E V A R T T N E D U T S
L A N O I T A N R E T N
I
Source : 1. Redseer Strategy Consultant Published report 2. Media reports
Macro Pressures & Consumer Preference Shift Fueling Growth For Branded Players
i
n a h c y l p p u S
t s o P s t n a r t s n o C
i
c i m e d n a p
r e m u s n o C
t f i h S
e c n e r e f e r P
d e d n a r B s d r a w o t
y t i l
a u q d o o G
s t c u d o r p
r o t c e S
n o i t a z i l
a m r o F
t s o P
n o i t a t n e m e p m
l
I
T S G
f o
f o h t w o r G
d e z i n a g r O
r o t c e S
Market Split
Branded
Others
55%
61%
53%
44%
43%
42%
40%
39%
45%
39%
47%
56%
57%
58%
60%
61%
CY19
CY20
CY21
CY22
CY23
CY24
CY25
CY26
Source: Euromonitor & internal estimates
Company Overview
Undisputed leader in an Oligopolistic Indian Luggage Industry
Established in 1968
#1 In the organized luggage space
Present in multiple luggage categories across price points
10 Own Manufacturing Facilities in India & Bangladesh
Servicing customers through ~11,000 Point of Sales across ~900 towns
~8000 employees
Milestones
Leveraging our rich heritage & strong legacy
Revenue Journey (Rs. In Cr.)
Aristocrat Acquisition
Caprese Launch
Skybags Launch
1,785
1,714
Aristocrat Restage
Bangladesh Operations
1,416
1,283
1,234
Carlton Acq China Ofc
1,064
988
868
854
745
614
567
521
439
287
305
296
321
331
Aristo Plast Pvt Ltd 297
8 6 9 1
Strategic Shift from China Sourcing To Own Mfg
1,290
619
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
13-14
14-15
15-16
16-17
17-18
18-19
19-20
20-21
21-22
Our Board & Management
is
graduate
a Commerce
He and an experienced industrialist who has pioneered the luggage industry in India. He has an experience of more than 50 years in the luggage industry
She a graduate from Oxford University and has done an MBA from the Harvard Business School. She has over 10 years of experience in managing and strategizing the business of luggage, bags and other travel accessories.
holds
a MBA in Marketing
He and International Business and has 25 years of leadership experience in the FMCG industry across business verticals and categories. He is responsible to build the organization growth strategy and lead execution across all business verticals & regions globally
She has completed B.Sc. from The Wharton School and an MBA from Harvard Business School. She is the Executive Chairperson of Godrej Consumer Products and Director of Godrej Agrovet and Teach For India.
Mr. Dilip Piramal Chairman
Ms Radhika Piramal Executive Vice Chairperson
Mr. Anindya Dutta Managing Director
Ms Nisaba Godrej Independent Director
Mr. Amit Jatia Independent Director
Mr. Tushar Jani Independent Director
Mr. Ramesh Damani Independent Director
Ms Neetu Kashiramka Chief Financial Officer
He has a degree in Business Administration from the Marshall School of Business, Los Angeles. He has attended several sessions of the YPO / Harvard President’s Program at HBS. He has over 26 years of experience in the QSR industry.
He is a Science graduate. He is a founder of Blue Dart Courier Services, Blue Dart Express Limited, Blue Dart Aviation Limited and Express Industry Council of India. He has over 40 years of experience in the Shipping and Transport Industry. He has pioneered inland logistics of sea freight containers.
He is a Commerce graduate and a post-graduate in Business from California State University, Northridge. He has over 20 years of experience in security market.
Administration, Marketing
along with
She is a qualified Chartered Accountant and has 25 years of experience across varied industries. At VIP industries, Financial Controller & business partner, she is responsible for Relationship, Legal, Information Commercial functions.
Technology
Secretarial,
Investor
being
and
the
Senior Management
Abhinav Kapoor Vice President Sales Over 20 years of experience in FMCG industry
Anjan Mohanty Chief Executive Officer – Bangladesh 23 years of experience in apparel industry
Anup Sur Head - Supply Chain & Logistics 24 years of experience across varied industries
Ashish Saha Sr. Vice President – India Manufacturing & New Projects 42 years of experience in luggage industry
MVH Sastry Head Procurement & Sourcing 20 years of experience in FMCG industry
Praful Gupta Head Marketing 22 years of experience in FMCG & luggage industry
Suhas Kshirsagar Head - Corporate Quality & After Sales Service 27 years of experience in luggage, automotive & FMCG industry
Sunil Kolhe Sr. Vice President – Design & Product Development 34 years of experience in luggage industry
Vikas Anand Vice President - Human Resources 17 years of experience across varied industries
VIP Power Brands : High Equity, targeted at distinctive opportunity spaces
Proposition
Innovative & Caring partner that makes every trip comfortable, safe and enjoyable
Trendy , colorful luggage brand that helps you get noticed
Partner every young middle Indian in this journey with products that are built to outperform and outlast
Hello Holidays
Move in Style
Unpack Your Dreams
Brand Print
BRANDS FROM THE HOUSE OF VIP INDUSTRIES
VIP Power Brands : High Equity, targeted at distinctive opportunity spaces
Proposition
Luggage Partner For Young Visionaries & Leaders
Avant-garde range of handbags & accessories for every woman who wishes to announce her arrival in life
The New Face Of Business
All That A Girl Can Be
Brand Print
BRANDS FROM THE HOUSE OF VIP INDUSTRIES
Diversified Product Portfolio
HARD LUGGAGE
DUFFLE BAGS
SOFT LUGGAGE
LADIES HANDBAGS
BACKPACKS
Healthy geographical presence
RETAIL TRADE
MODERN TRADE
GENERAL TRADE
ECOM
CSD CPC
INSTITUTIONAL
Branch locations
4 Regions 20 Branches
Pop Strata
50K - 1 Lakh
1 - 5 Lakhs
Town Universe
VIP Penetration
FY20
YTD FY23
583
395
51%
85%
79%
98%
5 -20 Lakhs
81
100%
100%
20 - 50 Lakhs
50 Lakhs+
8
5
100%
100%
100%
100%
Total
1072
68%
88%
Towns universe as per census 2011 data
High Impact Investment In Own Manufacturing ! Rs 100 CRORES IN FY23 !
In-house Manufacturing Capacities Enhanced by 65% Since Pandemic
Pre-pandemic FY20
3p Sourcing, 13%
China, 34%
Own Manufacturing, 42%
Controlled Mfg - India, 12%
Revenue volumes split by source
Post-pandemic YTD FY23
3p Sourcing, 4%
China, 7%
Controlled Mfg - India, 19%
Own Manufacturing, 69%
Planned Capex For FY23 Is Rs. 100 Crores – Post Which Capacity Enhancement Would Stand At 80% Capex at both Bangladesh and India at ~Rs. 50 crores each.
Financial Overview
Performance Highlights (Consolidated)
Operational Highlights
• Q3 revenue reported an all-round growth at 32% YoY
(volume 25%) and 22% over base (volume 18%)
• Gross margins* inching up with sequential
improvement of 1.3% - mainly on account of favorable raw material prices & ocean freight
• Gross margins* also improved year-on-year by 0.5% • Q3 overall expense is at Rs. 187 cr as compared Rs. 137 cr last year on account of increased operations
• Other expenses includes additional provision on
account of Future group of Rs. 6 crores
EBITDA % - Q3 FY 22 Decrease in Gross Margin (incl. other income) Better absorption of Employee Cost Increase in Advertisement exp PDD Future group Better absorption of Other Expenditure EBITDA % - Q3 FY 23
16.4% -0.5% 1.0% -3.3% -1.0% 1.7% 14.3%
Q3 FY22
Q4 FY22
Q1 FY23
Q2 FY23
Q3 FY23
Revenue (Rs. cr)
Growth (over base FY20)
397
-8%
356
14%
591
5%
515
25%
526
22%
Q3-FY23 Consolidated Financial Performance
INR 526 Cr. Revenues
49.4%* GP %
14.3% EBITDA %
INR 51 Cr. PBT#
+32%
+0.5
-2.1%
+16%
Over Q3 FY22
YTD-FY23 Consolidated Financial Performance
INR 1632 Cr. Revenues
49.2%* GP %
15.9% EBITDA %
INR 188 Cr. PBT#
+75%
+0.5%
+1.2%
+168%
Over YTD FY22
*net off other income #Before exceptional item
21
Q3 & YTD Financial Performance - Consolidated
Particulars Revenue from Operations Other Income Total Revenue COGS Gross Contribution GC Margin (without Other Income) Employee Benefits expenses Other Expenses Total Expenses EBIDTA EBIDTA Margin Depreciation EBIT Finance Cost Profit before Exceptional items Exceptional items Expense / (Income) Profit before Tax Tax Profit After Tax
Quarter ended
Year ended
Year ended
Dec-22 526 3 529 266 263 49.4% 59 128 187 76 14.3% 18 57 7 51 0 51 7 44
Sep-22 515 5 520 267 253 48.1% 58 118 176 77 14.8% 18 59 7 52 0 52 9 43
Dec-21 397 9 407 203 204 48.9% 50 87 137 67 16.4% 17 49 5 44 0 44 10 33
Dec-22 1632 15 1647 829 818 49.2% 177 378 556 262 15.9% 54 208 20 188 -15 203 46 157
Dec-21 934 31 964 479 485 48.7% 133 210 343 142 14.8% 53 89 19 70 0 70 16 55
Mar-22 1290 36 1326 645 681 50.0% 189 311 500 181 13.6% 70 111 25 86 0 86 19 67
Key Financial Metrics – P&L
529
Revenue
520
407
Gross Margin (Excl Other Income)
49.4%
48.1%
48.9%
Dec-22
Sep-22
Dec-21
Dec-22
Sep-22
Dec-21
EBITDA
PBT before Exceptional Item
14.3%
14.8%
16.4%
51
52
44
Dec-22
Sep-22
Dec-21
Dec-22
Sep-22
Dec-21
Brands, Channels & Categories
Revenue Performance : Channels
Channel-wise revenue Salience
General trade
Retail trade
Modern trade
Ecom
CSD CPC
Institutional
International
Q3 FY20
22.4%
15.7%
30.3%
9.4%
11.4%
8.1%
2.7%
Q3 FY22
22.5%
11.4%
33.5%
13.5%
10.1%
6.0%
3.1%
Q3 FY23
24.0%
11.3%
29.2%
12.5%
11.5%
7.6%
3.9%
YoY % Growth
39%
29%
14%
21%
49%
65%
65%
GT
GT distribution is currently present in 942 towns across India
EBO
Our retail store count is at 443 & 42 additional under fit-out
MT
Future group loss mitigated within other chains
ECOM
IB
Continued on growth trajectory
Enhanced extraction from existing high potential markets
Revenue Performance : Categories & Brands
Brand-wise revenue Salience
CARLTON
VIP
SKYBAGS
Q3 FY20
6.7%
26.2%
33.6%
Q3 FY22
5.2%
22.5%
30.6%
Q3 FY23
5.6%
23.1%
29.5%
Premium & Mass Premium
66.6%
58.3%
58.2%
ARISTROCRAT+ ALFA
CAPRESE
27.1%
6.2%
38.6%
3.1%
38.2%
3.6%
YoY % Growth
Category-wise revenue Salience
Q3 FY20
Q3 FY22
Q3 FY23
YoY % Growth
40%
33%
26%
30%
29%
52%
UPRIGHTS
HL - UPRIGHT
SL - UPRIGHT
DUFFEL BAGS
BACKPACKS
34.9%
46.9%
32.7%
29.7%
47.3%
27.7%
11.0%
10.0%
9.3%
14.4%
10.0%
12.0%
LADIES HAND BANGS
6.2%
3.1%
3.6%
32%
21%
22%
57%
52%
Brand Activations driven full throttle
VIP Puts Stake In The Ground As A Pioneer In Tech Luggage !
Rajiv Makhni becomes the face of VIP’s tech luggage
Customer Exchange Offer
He is recognized as the Tech Guru of India, He is a technology journalist and tech TV show anchor at NDTV. Rajiv is also a columnist, and he writes for several publications in India and abroad such as- the “Outlook Group,” “Hindustan Times, “Leisure International,” and many more. He has been named as the “Television Anchor of the Year” by the Indian Television Academy Awards.
Offer Period 1st Dec’22 to 31st Jan’23 Consumers can exchange any old bag and get flat Rs. 2,000 off on select VIP bags. The offer gives consumers a chance to upgrade their old, out dated luggage to the new, stylish and contemporary VIP bags
Star Studded FIFA Collection Launch !
Skybags launched its high voltage FIFA campaign with Bollywood star Kartik Aaryan as Ambassador Digital campaigns also featured many other celebrities & influencers
Hoardings with stadium Surround Sound
Skybags Has The Highest Followers In Luggage Category On Instagram !
Going Glam With Caprese !
Strong Brand Activations With Celebrity Designer Manish Malhotra ! The Who’s Who Of the Fashion World Adorning Caprese !
Caprese followers now at 189K with a 100% jump in last 6 months
For Further Information Contact:
VIP Industries Limited
Miss Neetu Kashiramka – Chief Financial Officer Email: neetu.kashiramka@vipbags.com
Adfactors PR Pvt. Ltd.
Snighter Albuquerque/ Rushabh Shah Email: snighter.a@adfactorspr.com/ rushabh.shah@adfactorspr.com Mobile: 9819123804 / 8082180182
5th Floor, DGP House, 88-C, Old Prabhadevi Road, Mumbai – 400025
Thank you