Shalimar Paints Limited has informed the Exchange regarding Investor Presentation
Q4 & FY19 Results Presentation
May 2019
Company
Overview
2
Quick Snapshot
Rich brand heritage of
Annual capacity of KLPA*
PAN India customer base
Presence across cities
116+Yrs
73,560
3,500+
700+
Strategically located manufacturing facilities
Regional distribution centers#
Depots across India
3
3
32
* Nashik plant has been rebuilt in May-19 # In addition, we have one more distribution center in the Chennai plant
3
Rich Brand Heritage
Shalimar Paints is a pioneer in the Indian Paints industry with a rich brand legacy of 116+ years
Shalimar Paints has many firsts in the
Indian paints industry -
▪ Radiation resistant coatings for
nuclear power plants
▪ Polyurethane paint for fighter
aircrafts
▪ High build Zinc coatings
It is focused on both decorative segment (66% of FY19 revenues) and industrial segment (34% of FY19 revenues) in the paints business
It has comprehensive retail product portfolio catering to the high growth decorative segment
Emulsions Enamel Distemper Others
4
Comprehensive Product Portfolio
Entire spectrum of products across categories & price points catering to the decorative segment
Marginal Presence
Meaningful Presence
Contribution to FY19 Decorative Segment Revenues 4
Product Categories
Super Premium/ Premium 1
Premium Economy/ Economy 2
Mass Segment 3
% Share
Emulsion
Enamel
Distemper
Others
✓
✓
NA
NA
✓
✓
NA
✓
✓
✓
✓
✓
Note: 1) Super Premium / Premium category consists of products with MRP > Rs 300 2) Premium Economy / Economy category consists of products with MRP > Rs 100 & < Rs 300 3) Mass category consists of products with MRP < Rs 100 4) Decorative segment accounted for 66% of total revenues in FY19
22%
30%
8%
40%
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National Footprint
Pan-India reach through strategically located manufacturing facilities and wide distribution network
Sikandrabad (UP) 10.2 Acres
Facility
Chennai
Sikandrabad
Nashik
Total
Operational Capacity (KLPA)
24,000
23,400
26,1601
73,560
Manufacturing Plant
Depot/Sales Office
Distribution network with 3,500+ active customers,
32 sales depots and 3 regional distribution centers2
Chennai (TN) 8.89 Acres
across pan India
Nashik (MH) 15 Acres
1) Nashik plant has been rebuilt in May-19 2) In addition, we have one more distribution center in the Chennai plant
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Marketing & Branding Initiatives
Focus on “Pull Marketing” Strategy
Above the Line Initiatives
Below the Line Initiatives
Outdoor
Radio
Magazines
Social Media
Outdoor Branding
Events
Geographically focussed campaigns to enhance distribution expansion
Radio campaigns pan India in leading radio stations
Campaign ads in leading magazines
Social media campaigns on Facebook, Instagram, Twitter & LinkedIn
Multiple dealers are provided with In-shop standees and dealer boards
Hold painter & contractor meets to strengthen the influencer networks
CSR led marketing activities to create good brand visibility
Continued focus on expanding the market outreach and capturing greater mind share of the customers
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Marketing & Branding Initiatives
Kahaani Project
Volunteers from 7 countries | 8,000+ sq. ft. covered | 14 Murals | 300+ livelihood empowered
8
Marketing & Branding Initiatives
Rang Badlav Ke Project
2 Weekends | 1,600 Volunteers | Painted 3,000+ walls | 700+ Murals
9
Marketing & Branding Initiatives
Events & Exhibitions
Dealer Connect (Industrial & Decorative)
Goa | Chennai
Industrial Exhibitions
Painter Meets (Registered Painters 19,500 |
Active Painters 1,800 | Success rate 86%)
10
Business Strategy
& Outlook
11
Operational Disruptions Impacting Historical Performance
Howrah Plant Closed in Mar-14
New Plant in Chennai in Sep-17, Nashik Plant rebuilt in May-19
7.6%
2.4%
4.5%
Nashik Plant Closed in Nov-16
73,560
60,200
44,400
21,600
501.7
433.3
-12.2%
-20.6%
349.8
271.2
287.6
Mar-13
Mar-15
Mar-17
May-19
FY13
FY15
FY17
FY18
FY19
Manufacturing Capacity (KLPA)
Revenues (Rs Crore)
EBITDA Margin %
There was a major fire incident at Howrah factory in March 2014 and at Nashik factory in November 2016
This impacted business operations leading to lower production & sales, lower margins, higher working capital cycle and
reduced engagement with channel partners
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Business Turnaround Strategy & Outlook
Manufacturing Capacity
Working Capital Funding
• Chennai plant
capacity increased to 24,000 KLPA
• Equity infusion of Rs 250 cr through two rights issues (Mar-18 & Jan-19)
• Nasik plant was
partly operational (1,800 KLPA) in Apr-17
• Rebuilding of Nasik plant completed with 26,160 KLPA
•
Total operational capacity (3 plants) reinstated to 73,560 KLPA
•
•
•
Lower RM costs with normalised creditor days
In-house production of intermediates (Alkyd Resins) to drive sourcing cost efficiencies
Improved working capital efficiency
Product Portfolio & Inventory Management
• Normalised production schedules
• Better stock
management
•
•
Increasing the Tinting Machine Network
Focus on higher sales of premium products
• Positive operating
Leverage
• Restoration of
historical peak performance
Distribution Network
Branding & Promotion
•
Frequent engagement with channel partners
• Restoration of
ability to effectively service demand
• Reactivation of the inactive dealer base and addition of new dealers
•
Improved sales traction through effective channel partner engagement
• Painter Loyalty Programme engaging 19,000+ painters
• Dealer
engagement through club schemes, sell in schemes
• Other BTL Initiatives
•
Transition from “Push strategy” to “Pull strategy” with sustained A&P spend
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Q4 & FY19
Results Update
14
Q4 FY19: Key Highlights
Improving Quarterly Revenue Trend (Rs Crore)
71.7
74.9
89.5
60.2
51.5
Q4 FY18
Q1 FY19
Q2 FY19
Q3 FY19
Q4 FY19
15
Q4 FY19: Key Highlights
Quarterly EBITDA Trend (Rs Crore)
-10.2
-12.0
-6.2
-7.4
-34.2
Q4 FY18
Q1 FY19
Q2 FY19
Q3 FY19
Q4 FY19
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FY19: Key Highlights
Revenues (Rs Crore)
287.6
271.2
FY18
FY19
Revenues: Segment Wise %
Industrial, 34.3%
Revenues: Region Wise %
South, 17.6%
West, 14.7%
East, 23.8%
Decorative , 65.7%
North, 43.9%
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Q4 & FY19: Profit & Loss Statement
In Rs Crore
Q4 FY19
Q4 FY18
Revenue From Operations (Net of Excise Duty)
Other Income
Total Income
COGS
Gross Margin
Gross Margin %
Personnel Expenses
Other Expenses
EBITDA
EBITDA Margin %
Depreciation
Interest Expense
PBT
Exceptional Items 1
Taxes
PAT
PAT Margin %
89.5
1.3
90.8
73.3
17.5
19.3%
10.8
40.9
-34.2
60.2
0.1
60.3
45.5
14.7
24.4%
10.3
14.6
-10.2
2.2
6.3
-42.7
-11.6
-11.0
-43.3
-47.6%
4.1
7.3
-21.6
0.0
-5.5
-16.1
-26.7%
FY19
287.6
2.3
289.9
220.6
69.4
23.9%
42.0
87.1
-59.8
FY18
271.2
0.9
272.1
208.9
63.2
23.2%
39.4
57.0
-33.2
8.5
24.9
-93.2
-15.7
-27.3
-81.5
7.9
26.0
-67.1
0.0
-21.7
-45.4
-28.1%
-16.7%
18
-37.6%
-16.9%
-20.6%
-12.2%
1) Exceptional item is damaged inventories valued at Rs 11.55 crore approved by audit committee to be disposed as scrap
FY19: Balance Sheet
Particulars (Rs In Crore)
Equities & Liabilities
Equity Share Capital
Other Equity
Total Equity
Non-Current Liabilities
Financial Liabilities
Borrowings
Other Financial Liabilities
Provisions
Total of Non-current liabilities
Current Liabilities
Financial Liabilities
Borrowings
Trade Payables
Other Financial Liabilities
Other Current liabilities
Provisions
Total Current Liabilities
Total Equity & Liabilities
FY19
FY18
Particulars (Rs In Crore)
FY19
FY18
10.7
277.8
288.5
18.1
1.1
6.0
25.3
126.8
97.6
29.5
3.6
4.5
262.1
575.9
3.8
117.3
121.1
24.9
0.2
6.7
31.8
150.0
139.5
17.2
15.6
1.9
324.2
477.1
Non-Current Assets Property, Plant & Equipment
Capital work in progress
Intangible assets
Financial Assets
Investments
Loans
Other Financial Assets
Deferred Tax Assets (net)
Other Non-Current Assets
Total Non-Current Assets
Current Assets Inventories
Financial Assets
Trade Receivables
Cash & Bank balances
Other Financial Assets
Current Tax Assets (net)
Other Current Assets
Total Current Assets
Total Assets
220.6
0.7
1.8
0.7
9.0
0.4
2.9
0.2
236.3
74.0
105.8
19.1
24.1
2.8
15.0
240.8
477.1
215.7
23.6
1.3
0.8
9.1
0.3
30.5
4.4
285.7
71.4
99.0
91.0
10.6
2.8
15.5
290.2
575.9
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Thank You
Disclaimer
Certain statements in this communication may be considered as “forward looking statements“ within the meaning of applicable law and regulations. These forward – looking statements involves a number of risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward looking statements , important development that could affect the company’s operations include changes in the industry structure, significant changes in politics and economic environment in India and overseas, tax laws, import duties, litigation and labour relations.
Shalimar Paints Limited does not undertake to revise any forward – looking statement that may be made from time to time by or on behalf of the company.
Shalimar Paints Limited will not be in any way responsible for any action taken based on such statement and undertake no obligation to publicly update these forward looking statement to reflect subsequent event or circumstances.
Sandeep Gupta CFO Email Id – Sandeep.Gupta@shalimarpaints.com
Manasi Bodas / Mehul Mehta IR Consultant Email Id – manasi.bodas@dickensonir.com / mehul.Mehta@dickensonir.com Contact No: 9821043510 / 9820280325
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