Balkrishna Industries Limited has informed the Exchange about Investor Presentation
BALKRISHNA INDUSTRIES LTD. Investor Presentation
October’23
Safe Harbor
GROWING TOGETHER
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 – Q2FY24
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Sales Volume
70,585 MT
EBITDA
Rs. 548 cr
Net Profit
Rs. 335 cr
Revenue
Rs. 2,247 cr
EBITDA Margin
24.4%
2nd Interim Dividend
Rs. 4 per equity share
All Figures on Standalone basis
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Performance Snapshot – H1FY24
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Sales Volume
137,794 MT
EBITDA
Rs. 1,035 cr
Net Profit
Rs. 648 cr
Revenue
Rs. 4,362 cr
EBITDA Margin
23.7%
Total Dividend (incl 2nd Interim Dividend)
Rs. 8 per equity share
All Figures on Standalone basis
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Management Commentary
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In Q2, the Company faced challenges on account of heat waves and recessionary fears in export markets. While the inventory related challenges in international markets have normalized, the confidence levels in distribution channel is moderate, leading to a gradual and slow improvement. India markets continues to perform relatively better.
The volumes in Q2 were partly contributed by the inventory created in June 2023 but could not be shipped out, due to Biparjoy disruptions. Q2 also saw normalization of raw material cycle which is evident in the improvement in margins on a QoQ basis.
Company had estimated a capex spend of Rs. ~600cr for FY24. Out of this, routine maintenance capex was estimated to be at Rs. 250-300cr. Given the aspirations of growth and better control over quality, the Company has decided to set up a mould manufacturing capacity. This will be a standalone new project at Bhuj entailing a capex spend of Rs. 300 crores. This should get commercialized by end of Q1FY25. Therefore, the capex spends would be ~Rs. 900crores for FY24.
Overall, the Company expects stable trajectory to continue and better H2FY24. However, given the H1FY24 related challenges and volume performance, company expects FY24 volumes de-grow marginally.
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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
1,37,794
H1FY24
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Volume Profile
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Segmental Sales
Channel Sales
Geographical Sales
3.3%
2.0%
9.7%
26.5%
38.5%
H1FY24
58.2%
H1FY24
28.6%
H1FY24
45.1%
Agriculture
OTR
Others
Replacement
OEM
Others
Europe
Americas
India
RoW
71.5%
16.6%
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
Q2FY24
Sales (MT)
70,585
Q2FY23
78,872
2,226
21
2,247
1,097
-16
111
506
548
Total Income
EBITDA
2,704
102
2,806
1,233
136
102
771
564
24.4%
20.1%
YoY
-11%
-20%
-3%
Tax
PAT Margin
Profit Before Tax
Profit After Tax
52
25
23
159
444
108
335
58
49
4
134
532
128
404
-17%
-17%
14.9%
14.4%
14.8%
Standalone
Q1FY24
67,209
2,120
-5
2,115
1,058
-36
105
501
487
23.0%
66
33
21
154
411
98
312
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QoQ
5%
6%
13%
8%
7%
FY23
3,01,181
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)
Q2FY24
Q2FY23
Q1FY24
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
21
8
30
25
55
102
18
120
49
168
-5
10
5
33
38
262
51
313
-88
224
All Figures on Standalone basis
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Balance Sheet
Particulars (Rs. Cr.)
ASSETS
Non-current assets
Property, Plant and Equipment
Capital work-in-progress
Investment Property
Other Tangible Assets
Financial Assets
(i) Investments
(ii) Other Financial Assets
Income Tax Assets (Net)
Other non-current assets
Current assets
Inventories
Financial Assets
(i)Investments
(ii) Trade Receivables
(iii) Cash and cash equivalents
(iv) Bank Balances other than (iii) above
(v) Loans
(vi) Others
Other Current Assets
TOTAL
All Figures on Standalone basis
Sep’23
Mar’23
Particulars (Rs. Cr.)
Sep’23
Mar’23
GROWING TOGETHER
8,768
5,628
1,318
66
1
8,385
5,278
1,392
71
0
EQUITY AND LIABILITIES
EQUITY
Equity Share Capital
Other Equity
Non-Current Liabilities
Financial Liabilities
1,310
1,263
(i)Borrowings
162
-
283
3,710
1,338
933
1,056
29
10
6
70
267
94
-
288
3,887
1,592
775
1,254
31
7
4
51
174
12,478
12,272
(ii)Other Financial Liabilities
Provisions
Deferred Tax Liabilities (Net)
Other Non-Current Liabilities
Current liabilities
Financial Liabilities
(i) Borrowings
(ii) Trade Payables
(iii) Other Financial Liabilities
Other Current Liabilities
Provisions
Tax Liabilities
TOTAL
8,229
39
8,191
7,589
39
7,550
1,284
1,432
853
12
28
307
84
1,038
64
26
241
63
2,965
3,251
1,980
2,216
489
131
328
7
30
487
218
325
4
1
12,478
12,272
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Cash Flow
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Particulars (Rs. Cr.)
Sep’23
Mar’23
Operating profit before working capital changes
Changes in working capital
Cash generated from operations
Direct taxes paid (net of refund) and others
Net Cash from Operating Activities
Net Cash from Investing Activities
Net Cash from Financing Activities
Net Change in cash and cash equivalents
1,039
344
1,383
-162
1,221
-689
-533
-1
1,997
-244
1,752
-338
1,414
-1772
359
1
All Figures on Standalone basis
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Resilient Business Model
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Gross Cash and Cash equivalents of Rs. 2,283 Cr as on 30th September’23
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
•
• •
•
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
thus
•
•
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
•
•
•
•
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.