Balkrishna Industries Limited has informed the Exchange about Investor Presentation
BALKRISHNA INDUSTRIES LTD.
Investor Presentation
Aug’23
Safe Harbor
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This presentation and the accompanying slides (the “Presentation”), which have been prepared by Balkrishna Industries Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment whatsoever. No offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company.
This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded.
Certain matters discussed in this Presentation may contain statements regarding the Company’s market opportunity and business prospects that are individually and collectively forward-looking statements. Such forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and assumptions that are difficult to predict. These risks and uncertainties include, but are not limited to, the performance of the Indian economy and of the economies of various international markets, the performance of the tire industry in India and world-wide, competition, the company’s ability to successfully implement its strategy, the Company’s future levels of growth and expansion, technological implementation, changes and advancements, changes in revenue, income or cash flows, the Company’s market preferences and its exposure to market risks, as well as other risks. The Company’s actual results, levels of activity, performance or achievements could differ materially and adversely from results expressed in or implied by this Presentation. The Company assumes no obligation to update any forward-looking information contained in this Presentation. Any forward-looking statements and projections made by third parties included in this Presentation are not adopted by the Company and the Company is not responsible for such third party statements and projections.
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Performance Snapshot – Q1FY24
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Sales Volume
67,209
-19% YoY
EBITDA Margin
23.0%
+295bps YoY
All Figures on Standalone basis
Revenue
Rs. 2,115 cr
-22% YoY
Net Profit
Rs. 312 cr
-2% YoY
EBITDA
Rs. 487 cr
-11% YoY
Dividend
Rs. 4 per equity share
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Management Commentary
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Towards the end of June, the Company faced disruptions on account of Biparjoy cyclone in the state of Gujarat. The operations of the Bhuj plant were suspended from late evening of 13th June and while operations resumed on 19th June 2023, it led to a loss of ~5 days of production. However, the dispatches were affected for all the plants till June end due to disruptions at Mundra Port. This resulted in lower export volumes in Q1.
The overall sales volumes in Q1 stood at 67,209 MT.
Domestic sales stood 21,012 MT which saw a healthy 19% growth YoY.
In Q2, there are challenges due to heat waves and recessionary fears in export markets.
On a positive note, inventory related challenges across the globe is unwinding.
the channel
However, momentum in Domestic markets continues.
Capex spend is estimated at Rs. 550-600cr for FY24. Out of this, routine maintenance capex will be Rs. 250-300cr. The balance will be spent towards new product development like rubber tracks, giant solid tires to widen product basket in end markets along with higher investments in brand building and marketing efforts which is required to reach market share goal of 10%.
This market share aspiration will be reached in 3-4 years post next round of capex getting commercialized.
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Sales Volume Profile
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2,27,131
2,88,795
FY 2021
FY 2022
3,01,181
FY 2023
Sales volumes in MT
All Figures on Standalone basis
67,209
Q1FY24
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Volume Profile
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Segmental Sales
Channel Sales
Geographical Sales
3.7%
2.3%
8.6%
26.0%
37.8%
Q1FY24
58.5%
Q1FY24
31.3%
Q1FY24
44.8%
Agriculture
OTR
Others
Replacement
OEM
Others
Europe
Americas
India
RoW
71.8%
15.3%
All Figures on Standalone basis
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Profit & Loss
Particulars (Rs in Cr)
Revenue from Operations
Realized Gain on Foreign Exchange
Raw Material
(Increase) / Decrease in Stock
Employee Expenses
Other Expenses
EBITDA Margin
Other Income
Unrealized Gain / (Loss)
Interest & Finance Charges
Depreciation
Tax
PAT Margin
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Standalone
Sales (MT)
Total Income
EBITDA
Q1FY24
67,209
2,120
-5
2,115
1,058
-36
105
501
487
Q1FY23
83,153
2,646
80
2,726
1,400
-131
107
803
547
23.0%
20.1%
66
33
21
154
411
98
312
-15
26
3
126
429
109
320
14.8%
11.7%
Profit Before Tax
Profit After Tax
YoY
-19%
-22%
-11%
-4%
-2%
FY23
301,181
9,811
262
10,072
4,909
47
404
2,684
2,028
20.1%
114
-88
46
557
1,451
372
1,079
10.7%
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Net Forex Gain/(Loss)
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Particulars (Rs in Cr)
Q1FY24
Q1FY23
FY23
Foreign Exchange Fluctuation on Sales
Foreign Exchange Fluctuation on Others
Total Realised Gain/(Loss) – A
Total Unrealized Gain/(Loss) - B
Net Forex Gain/(Loss) = A + B
-5
10
5
33
38
80
11
91
26
117
262
51
313
-88
224
All Figures on Standalone basis
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Resilient Business Model
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Gross Cash and Cash equivalents of Rs. 2,245 Cr as on 30th June, 2023
Diversified Product Portfolio, spread across Agriculture, Industrial, Construction, Earthmoving, Mining, Port, Lawn and Garden and ATV tires
Self Reliant in Carbon Black along with Multiple sourcing arrangements for other Raw Materials
All Tire building Capex programs completed
BKT has built a resilient business model and is confident to withstand the near-term challenges to emerge stronger with a higher global market share
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Strategy at BKT
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Balkrishna Industries – A Snapshot
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Leading ‘Off-Highway Tire” Exporter BKT is India’s Leading player in the Global ‘Off Highway Tire (OHT)’ Market
Wide and comprehensive product portfolio Deep understanding of OHT market has led to capabilities to manufacture over 3,200 SKUs
Capacities The current achievable capacity is 360,000 MTPA post commissioning of the waluj brownfield project
Global reach Sales to over 160 countries through Distribution network in Americas, Europe, India and Rest of the World
Strong OEM Presence Strong Partnerships with Global OEM’s a testimony of our Brand Acceptance & Performance
Experienced Management Team Experienced Management Teams across business divisions and verticals
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India Production and Global Sales
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Waluj, Maharashtra
Bhiwadi, Rajasthan
Chopanki, Rajasthan
Bhuj, Gujarat
Mould plant, Dombivali
India Our Manufacturing Base
Note – Maps not to scale. All data, information, and maps are provided “as is” without warranty or any representation of accuracy, timeliness or completeness
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Serving Global OEMs…
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The Brand Names and logos mentioned are the property of their respective owners and are used here for identification purposes only
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Business Practices Driving Long-Term Sustainability
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Energy Efficiency
Environment
Waste Management
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To ensure energy efficiency Initiated use of ‘Green Energy’ – installing 5MW windmills and 2 MW solar power plants for our greenfield projects 40MW Captive Power Plant Capacity Installed 66TPH tail gas boiler received from carbon black plant coal consumption Installation of power management system to increase power generation from turbine set
recycling waste gases & reducing
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Controlled emissions through electrostatic precipitators in boilers and discharge through appropriate effluent treatment plants Planted approximately 1,00,000 trees in and around Bhuj plant
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Implemented disciplined waste management system for systematic collection of scrap and safe storage/disposal and re-use of wastes Promoted industrial recycling of waste like reclaim rubber, crumb powder and rubberised friction compound Usage of Jumbo plastic bags replaced by mobile silos for carbon black transfer from carbon plant to Tire plants Foldable container usage started for carbon transfer from bhuj carbon plant to other tire plants
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Promoting Education, Health & Rural Development
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Our Endeavour is to improve the lives of children and adults, and our mission is to ensure health with dignity to every underprivileged children and adult
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BKT – A Strong Global Brand from INDIA
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Strengthening BKT Brand : Americas
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BKT is the Official and Exclusive Tire manufacturer of MONSTER JAM and its fleet of Monster Trucks – Monster Jam is a top sporting event in America
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Strengthening BKT Brand : Canada
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BKT Continental Cup – Curling: BKT is the Title Sponsor of Continental Cup
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Strengthening BKT Brand: Spain, Europe
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BKT is the Official Global Partner for the Spanish Football League “La Liga”
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Strengthening BKT Brand: Italy, Europe
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BKT is the Title Sponsor for the ITALIAN SERIE ‘B’ FOOTBALL CHAMPIONSHIP – THE NEWBORN - “SERIE BKT”
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Strengthening BKT Brand: France, Europe
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BKT is the Sponsor for the “LIGUE de Football Professionel (LFP)” in France
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Strengthening BKT Brand: France, Europe
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BKT Is Official Tire Supplier for Rugby World Cup France 2023
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Strengthening BKT Brand: EUROPE
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BKT is associated with United Rugby Championship
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Strengthening BKT Brand : EUROPE
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Premium Partner of EUROLEAGUE BASKETBALL
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Strengthening BKT Brand : Tractor of the year (TotY) - EUROPE
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Team of expert journalists in agricultural mechanization, assign the Tractor of the Year (TotY) award to the ‘Best European Tractor’
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Strengthening BKT Brand : Australia
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BKT is the Official “OFF-HIGHWAY TIRE PARTNER” for KFC BIG BASH LEAGUE (THE AUSTRALIAN CRICKET LEAGUE)
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Strengthening BKT Brand : India
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The Brand Names and logos mentioned are the property of their respective owners and are used here for identification purposes only
Official Partner of Teams in the Cricket T20 League for Season 16
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Strengthening BKT Brand : India
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Click here for the BKT Video
Ranveer Singh is the Brand Ambassador of BKT
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Thank You
Company
Investor Relations Advisor
Balkrishna Industries Ltd. CIN - L99999MH1961PLC012185 Mr. M S. Bajaj Senior President (Commercial) & CFO msbajaj@bkt-tires.com www.bkt-tires.com
Strategic Growth Advisors Pvt. Ltd. CIN - U74140MH2010PTC204285 Mr. Shogun Jain shogun.jain@sgapl.net +91 77383 77756 www.sgapl.net
All images, texts and graphics contained in this document are the copyright of BKT. Permission to print hard copies of this material and to share it with interested people is granted unless otherwise provided by the Author of the document. It is forbidden to extract parts of the presentation without the express consent of the author. Balkrishna Industries Limited (BKT) cannot be held responsible for any incorrect data contained in this document. Any other form of reproduction, electronic or otherwise, as well as the application of any changes, partially or entirely, to images, texts, graphs and data is strictly prohibited without prior written permission from BKT. Balkrishna Industries Limited (BKT) reserves itself the right to alter any details contained in the document without prior notice.