Welspun Corp Limited has informed the Exchange regarding Investor Presentation for the quarter and half year ended September 30, 2019
WELSPUN CORP PIPES AND PLATES
WCt/SE~2019
To, USE Ltd. (Scrip Code-532144) Department of Listing, P. J. Towers, Dalal Street, Mumbai — 400 001.
Dear Sirs! Madam,
October 23, 2019
National Stock Exchange of India Ltd. (Symbol: WELCOKP, Series EQ) Exchange Plaza, Bandra-Kurla Complex, Bandra (F), Mumbai - 400 051.
Sub.: Q2 FY20 Investors’ Presentation
In continuation to our letter dated October 22, 2019, submitting Unaudited Financial Results for the quarter and half year ended September 30, 2019, please find enclosed the Q2 FY20 Investors’ Presentation which is being released to the media.
Thanking you. For Weispun Corp Limited
Pradeep Joshi Company Secretary FCS-4959
Weispun Corp Limited Welspun House. 5th Floor. Kamaia City. Senapati Bapat Marg, Lower Parel (West), Mumbai 400 013, India. T E-mail
: companysecretary_wcI@weIspun.com Website : www.welspuncorp.com
+91 22 6613 6000 / 2490 8000 F : +91 22 2490 8020
Registered Address: Welspun City, Village Versamedi, Taluka Anjar. District Kutch, Gujarat 370 110. India. T: +91 2836 662222 F: +91 2836 279060
Corporate Identity Number: L27100GJ1995PLC025609
Welspun Corp Ltd Investor Presentation - October 2019
World’s Leading Line Pipe Manufacturer
HSAW LSAW ERW/HFIW
SAFE HARBOUR
This presentation and the accompanying slides (the “Presentation”), which have been prepared by Welspun Corp 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.
This presentation contains certain forward looking statements concerning the Company’s future business prospects and business profitability, which are subject to a number of risks and uncertainties and the actual results could materially differ from those in such forward looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, competition (both domestic and international), economic growth in India and abroad, ability to attract and retain highly skilled professionals, time and cost over runs on contracts, our ability to manage our international operations, government policies and actions regulations, interest and other fiscal costs generally prevailing in the economy. The company does not undertake to make any announcement in case any of these forward looking statements become materially incorrect in future or update any forward looking statements made from time to time by or on behalf of the Company.
1. COMPANY OVERVIEW
AGENDA
2. FINANCIALS
3. OUTLOOK
AGENDA
WELSPUN CORP: AN OVERVIEW
FLAGSHIP COMPANY OF WELSPUN GROUP
Global Leader in Home Textiles Ranked #1 Home Textile Supplier to USA 5 Times in Last 6 Years
Global Leader in Large Diameter Pipes Manufacturing facilities in India, Saudi Arabia & USA
Specialised HAM Infra player Completed India’s 1st 14 lane Expressway in record time of 19 months vs scheduled 30 months
Group Revenue US$ 2.7 Billion
Fixed Asset Base US$ 1 Billion
Employees 25,000+
5
WELSPUN CORP LTD (WCL) - AT A GLANCE
World’s leading welded line pipe manufacturer
End-to-End service provider, offering comprehensive pipe solutions for a wide range of applications in oil and gas (for offshore and onshore projects) and water
With an aggregate capacity of 2.55 mn MTPA , WCL supplies pipes to some of the most challenging projects in the world
With manufacturing plants in India, USA and Saudi Arabia, WCL ‘s global client base is spread over 50 countries across the globe
Line pipes are used for transporting oil, gas or water over long distances (interstate or from offshore/ under-sea) or as gathering lines (from well to processing centre)
ERW/ HFIW
ERW/ HFIW
HSAW / LSAW
HSAW
Source: PHMSA, GAO & US EPA
6
KEY MILESTONES
Incorporated as Welspun Gujarat Stahl Rohren
First 50 KTPA HSAW mill at Dahej
200 KTPA LSAW mill at Dahej with Mannesmann, Germany
Won 1,700 KM Keystone project from Trans Canada
1995
1998
2000
2007
350 KTPA LSAW mill at Anjar; 300 KTPA HSAW mill at Saudi Arabia
Renamed as Welspun Corp Ltd.; 100 KTPA HSAW mill at Mandya
350 KTPA HSAW mill at Arkansas, US
Integrated plate and coil mill at Anjar; 150 KTPA HSAW mill at Anjar
2011
2010
2009
2008
Volumes of 1 mn MT; 175 KTPA small-diameter HFIW mill in the US to cater shale gas business; Demerged non-pipe businesses into Welspun Enterprise Ltd
4th year of > 1 mn MT volumes; Order book at record high; JV with Wasco Energy Ltd for CWC plant
All time high order book at 1,657 KMT (Rs. 109 Billion)
Bhopal plant commissioned; Saudi mill ramps up
2013
2016
2018
2019
7
CAPITAL MARKETS AND GOVERNANCE
Shareholding Pattern
Quarter ending September 2019
27.8%
9.0%
14.2%
49.0%
Promoter
FIIs
DIIs
Public
Market Statistics
As on September 30, 2019
Price per share
INR
133.55
USD
1.89
No of Shares outstanding (Mn)
265.2
265.2
Market Capitalization (Mn)
35,421
501
Daily Average Trading Volumes Q2 FY20) No of shares in Mn Daily Average Trading Value (Q2 FY20) (Mn)
0.5
63.6
0.5
0.9
♀ Strong credit rating (CRISIL):
♀ Long Term AA(-) with Positive
Outlook
♀ Short Term A1+
♀ Robust relationship with Marquee
financial institutions like:
♀ LIC ♀ Exim Bank ♀ SBI ♀ PNB
♀ Statutory Auditors
♀ M/s. Price Waterhouse Chartered
Accountants LLP
♀ Zero Pledge of shares by Promoters
♀ Diversified Board of Directors with
expertise across domains
♀ Payout to Shareholders
♀ Track record of paying dividend to shareholders for last 14 years
♀ Buyback at Rs. 135 per share (Opened
on 22nd October 2019)
8
DRIVING TOWARDS VALUE CREATION
No Pledge of shares by Promoters
All three geographies simultaneously performing
Strong future growth visibility
Strong Free Cash Flow generation
Saudi business – Operational & Financial Turnaround; EPS accretive
Visible improvement in Operational and Financial Performance
EPS A quantum improvement
Leaner B/S, High ROCE & Unlocking Value
CORE STRENGTHS
8
Sustainability at the core of the business
1
Turnaround in business performance
7
6
Experienced Board and Management with Proven Track Record
5
Focused on R&D and pipeline technology
4
End to End Products and Solutions
2
3
Global Reach with Local Presence in Key Markets
Partnership with global giants
Expertise in delivering complex projects
10
1
END TO END PRODUCTS AND SOLUTIONS
Longitudinally welded pipes made from HR plates; used for onshore / off-shore oil & gas transmission.
LSAW Pipes
16 – 60 inch diameter, high wall thickness
HSAW Pipes
18 – 140 inch diameter, moderate wall thickness
Helically welded pipes made from HR coils; used for on-shore oil, gas & water transmission.
ERW/HFIW Pipes
1.5 – 20 inch diameter, low/moderate wall thickness
High-frequency electric welded pipes made from HR coils; used for downstream distribution of oil, gas & water.
Coating Systems Double Jointing, 3LPE, 3LPP, DJ, Internal Solvent /Solvent free coating, Coal Tar Enamel, Inside Cement Mortar Lining
Value Added services Concrete Weight Coating, Pipe bending, ID Machining, Dump Site & Inventory management
11
2
GLOBAL MANUFACTURING FACILITIES
INDIA
UNITED STATES
SAUDI ARABIA
Capacity (in KMT)
Products / City
Anjar
LSAW
HSAW
ERW/ HFIW
Total (KMT)
350
380
200
India
US
Saudi Arabia
Dahej
350
50
-
Mandya
Bhopal
Little Rock
Dammam
-
150
-
-
175
-
1,655
-
350
175
525
-
375
-
375
Total
700
1,480
375
2,555
Modern manufacturing facilities with minimum maintenance capex
Port based facilities
All major accreditations
Best in class equipment & practices
12
2
GLOBAL CUSTOMER REACH
AMERICAS
Canada
USA
EUROPE & CIS
Russia
Czech Rep.
Spain
Bahamas
Algeria
Mexico
Trinidad & Tobago
Venezuela
Colombia
Nigeria
MENA
Iraq
Qatar
China
Egypt
Sudan
UAE
Saudi
Oman
Bangladesh
India
Thailand
DOMESTIC
Malaysia
SOUTH EAST ASIA AND AUSTRALIA
Plant Locations
● Anjar, India
● Dahej, India
● Mandya, India
● Bhopal, India
● Little Rock, USA
● Dammam, Saudi Arabia
Peru
Bolivia
Argentina
Marketing Offices
● Mumbai, India
● Houston, USA
● Dammam, Saudi Arabia
Indonesia
Manufacturing Plants
Countries Serviced
Reaching over 50 countries across the globe
13
3
ESTABLISHED RELATIONSHIP WITH GLOBAL GIANTS
Oil & gas
Transportation
Others
Approvals & accreditations from marquee customers across the globe
14
4
EXPERTISE IN EXECUTING CRITICAL PROJECTS
AMONG THE
Deepest
Heaviest
Highest
Longest
Independence Trail 233 Kms, 24” deep sea gas transmission pipeline in Gulf of Mexico Complexity: High collapse resistance
Water Depth 2,420m (7,940 ft)
IGAT- IV 100 Kms, 56” of high pressure gas transmission pipeline in Persian Gulf Complexity: Large diameter high wall thickness, X70 grade of steel
Wall Thickness 35.56 mm
Peru LNG 118 Kms, 34” gas transmission pipeline Complexity: Pipeline in service at very high altitude
Altitude > 9,000 feet
Keystone Pipeline One of the largest Supplier for Canada to USA, 36” Crude Oil Pipeline Complexity: Long distance hydrocarbon pipeline
Length ~1,450 kms
Sour Service
Arabiyah-Hasbah (Wasit Gas Program) 100 kms, 36” of gas pipeline in Saudi Arabia Complexity: Highly sour gas
Stringent tolerance level
Stampede Oil Export SCR* Pipeline ~32 kms, 18” oil, 25.40 mm wall thickness pipeline in Gulf of Mexico Complexity: Only WCL could match specifications
Wall Thickness 42.9 mm
OOR at pipe ends: 2 mm maximum
Track Record of delivering more than 13 million tonnes of Pipeline
Note: *SCR = Steel Catenary Riser
15
5
FOCUS ON R&D AND PIPELINE TECHNOLOGY
Technical knowhow with optimal solutions
Experience of delivering pipe with stringent specifications gives us the edge for prestigious and challenging projects like Keystone Pipeline, Peru LNG, Wasit Gas Program, Independence Trail, IGAT-IV, Master Gas - I
Fully equipped Growth Workshop facilities to facilitate capability enhancement, capacity expansion, de- bottlenecking, automation and product development programs
Dedicated R&D facility
Continuous research
Continuous research in steel, strain-based and deep sea pipelines, welding technology and consumables, and quality integrated management systems
Technical experts, who belong to various international technical committees for oil and gas pipeline research, contribute to the development of new standards for line pipe durability
Technical expert team
16
6
EXPERIENCED BOARD AND MANAGEMENT
Board of Directors
Management Team
B.K.Goenka, Chairman • Amongst India’s most dynamic businessmen.
• Ranked amongst India’s Most Powerful CEOs by Economic Times.
Rajesh Mandawewala, Group MD • Associated with Welspun Group since 1985 as promoter.
• Chartered Accountant with experience across industries.
Amita Misra – Independent Director • 38+ years of experience in various government & international organizations. • Area of specialization includes - Finance, Governance, Policy, etc
Vipul Mathur, Managing Director & CEO, Member of Board • Well-known figure in the global pipe industry; Associated with Welspun since 2001 • Contributed significantly towards the growth of the Company • Recipient of Hall of Fame Steel CEO of the year (2018) by SUFI
Percy Birdy, Chief Financial Officer • Member of ICAI and ICWAI with 25+ years of experience in the areas of Corporate Finance & Accounting, Costing, Budgeting, Direct & Indirect Tax, Banking, etc.
• Has previously worked with Allanasons Group, Glenmark, Essel Propack
Desh Raj Dogra - Independent Director • Retired Managing Director & CEO of Credit Analysis and Research Limited. He is an MBA, CAIIB,
M.Sc., B.Sc. Over 38 years of experience in financial sector.
Godfrey John, Business Head - INDIA /APAC/MENA & EUROPE • • Expertise in pipes across applications such as Oil & Gas, Water, Ports and
25+ years of experience in the industry.
Terminals as well as structural pipes
K. H. Viswanathan - Independent Director • Qualified cost and works accountant with over 34 years of experience in Corporate India.
Experience in the field of Tax and Legal advisory and structuring.
Raj Kumar Jain – Independent Director
33+ years of experience in the industry
Rusty Fisher, SVP –Sales and Marketing (USA) • • Has previously worked with Tubular Synergy Group, US Steel, Lone Star • Served as Chairman, Line Pipe Manufacturers Group (National Association of Pipe
• Over 30 years of experience in the field of finance and accounts and has been providing advice to
the Company in matters relating to accounts and internal control.
Coating Applicators)
Revathy Ashok - Independent Director • Gold medalist from the IIM, Bangalore. Independent Consulting Practice, working with mid and
early stage companies, helping them scale
Utsav Baijal - Nominee Director • Mr. Baijal is a nominee director of Insight Solutions Limited. Mr. Baijal joined Apollo in its New York
office and worked actively on distressed investments.
Hisham Abdullatif Mohammed Allhmil, CEO (Middle East) • Well-known figure in the Saudi steel and pipe industry • Previously worked with esteemed organizations in Saudi Arabia such as Saudi Steel
Pipe, SABIC, Saudi Iron and Steel Co. (HADEED)
T.S. Kathayat, President & Chief - Corporate Quality & Technical Services • • Conferred with “Quality leadership Award” and "Corporate Excellence Leader of the
23+ years of Work Experience in the manufacturing Industry
Kaushik Subramaniam - Nominee Director
Year “by World Quality Congress
• Degree of Financial Risk Manager with over 10 years of experience in the area of private equity
investing.
17
6
AWARDS & ACCOLADES – TESTIMONY TO EXCELLENCE
Vipul Mathur Hall of Fame Steel CEO of the year (2018)
OHS category in engineering sector : Anjar (2018)
Golden Peacock National Quality Award : Anjar (2017)
By The Martin Luther King Jr Commission of AR (2017)
CEO of the Year
Best energy practices
Golden Peacock Award
Salute to Greatness Award 2017
Bechtel Supplier Excellence Award (2018-19)
CII National 5S Excellence award (2018)
International Safety Award Anjar (2016)
Quality Systems Excellence Award for Manufacturing (Large Size Category) (2016)
Supply chain Excellence
“Gold Award” Anjar pipes
International Safety Award With merit
Excellence Award First Prize
and many more….
18
7
TURNAROUND IN BUSINESS PERFORMANCE
PIPE SALES VOLUME in KMT
Op EBITDA/ Ton in Rs.
656 H1 FY20
29.1% H1 FY20
571 H1 FY19
UP 15%
14,308 H1 FY20
8,660 H1 FY19
UP 65%
ROCE (%)
EPS in Rs.
22.6% FY19
UP 650 bps
11.3 H1 FY20
5.1 H1 FY19
UP 120%
♀ India operations:
♀ Saudi Arabia operations:
♀ Commenced exporting pipes to North
America for the world’s highest operating pressure pipeline
♀ Qtrly volume run rate of 100+ KMT ♀ Significant turnaround in operations resulting
in substantial positive PBT
♀ US operations:
♀ Deleveraging
♀ Qtrly volume run rate of 100+ KMT ♀ Strong EBITDA performance
♀ Net debt reduced by Rs. 887 mn in H1FY20;
currently at Rs.1,969 mn
Note: Pipe Sales volumes includes Saudi Arabia operations; All other figures pertain to IND-AS continuing operations
19
7
VISIBLE IMPROVEMENT IN KEY METRICS
Revenue
Op EBITDA & Margin
Net Debt
Net Worth
Note: •
Prior period figures are restated wherever necessary; All numbers of this sheet are based on IND-AS disclosures; FY19 onwards figures pertain to continuing operations (Pipes) only
20
60,355 75,873 89,535 43,101 FY17FY18FY19H1FY2011,0654,2162,8561,969FY17FY18FY19H1FY2028,09428,54027,97630,835FY17FY18FY19H1FY205,9357,0548,9685,7549.8%9.3%10.0%13.3%5.0%6.0%7.0%8.0%9.0%10.0%11.0%12.0%13.0%14.0%15.0%010002000300040005000600070008000900010000FY17FY18FY19H1FY20 8
SUSTAINABILITY IN EVERYTHING THAT WE DO
2,25,000 Trees planted in facilities in India with 635 acre of green cover; 8,500 tons of CO2 sequestered per year
Minimizing Water consumption and avoid Water wastage through advance technology. Reuse of Water through ETP and 30 MLD STP at Welspun City, Anjar
Recycling e-waste from landfills to reduce methane emissions. Disposed 1,020 kg in the year 2018-19 of E-Waste to Registered Recycler
Implemented extensive interventions to improve energy efficiency saving 45,536 kwh/annum /year; Natural gas is being utilized for processes by replacing coal
21
8
3Es @ WELSPUN GROUP
• Digital education
Empowerment
• Improving learning levels of children
• Welspun run schools
Education
3Es of Corporate Social Value
• Women Hygiene and Sanitary pads- Creating women entrepreneurs through distributorship model in villages ensuring each woman and adolescent has access to sanitary pads. So far 60 entrepreneurs are created impacting over 22,000 women in the villages of Anjar, Vapi, Saharanpur and Dewas
• Promoting Indian women in sports- Sponsorship to 13 women from
various discipline of sports coming from struggling backgrounds
Education
• Project Gyankunj on Digital Education – Installed 223 digital
software in govt school classrooms impacting over 50,000 children of Valsad, Kutch and Bharuch districts in Gujarat
• Welspun Vidya Mandir at Anjar: quality education to 1,600 students
with 75 Teachers
Environment & Health
Empowerment
• Gayatri Devi Public school at Anjar – Welspun run state board
school catering to 200 students from 1st to 9th std
• Health Camps & Mobile
Medical Vans
• Sanitation block construction
• Tree plantation
• Rain water harvesting
• Promoting Indian women in
sports
• Women Hygiene and
sanitary pads
Environment & Health
• Plantation- 30k saplings planted in Anjar, Vapi and Dahej so far
• Mobile Health Vans: Impacting 19 villages of Anjar
• Sanitation blocks- Built over 6,000 sanitation blocks in Vapi and
Anjar
• Project Navchetna- Initiative to curb Malnutiriton in children and
anemia in women. Operational in 10 villages of Anjar and 5 villages of Vapi benefitting over 22,000 villagers
22
AGENDA
WELSPUN CORP: FINANCIALS
ORDERBOOK – QUARTERLY TREND
(Figures in KMT)
Order Book Valued at USD 1.64 Billion
24
1,657 1,602 1,721 1,656 1,712 1,564 1,357 632212423274425171129254267304339369319337Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20Q2FY20Closing Order BookOrder BookedOrders Executed FINANCIAL PERFORMANCE – Q2 FY20 & H1 FY20
Note: • •
Prior period figures have been restated, wherever necessary Figures are pertaining to continuing operations only (Pipes)
25
Particulars (Rs Mn)Q2 FY20Q1 FY20QoQChange Q2 FY19YoYChangeH1 FY20H1 FY19YoYChangePipe Sales Volume (KMT) 337 319 5.6% 304 10.9% 656 571 14.9%Revenue 22,630 20,471 10.5% 21,525 5.1% 43,101 37,944 13.6%Operating EBITDA 3,169 2,585 22.6% 2,490 27.3% 5,754 4,231 36.0%MTM Loss on Bonds (17) (360) (282) (377) (282)EBITDA 3,306 2,416 36.8% 2,417 36.8% 5,722 4,359 31.3%Depreciation 610 545 11.9% 771 -20.9% 1,155 1,329 -13.1%Finance cost 341 395 -13.8% 454 -25.0% 736 820 -10.3%Profit before tax and share of JV 2,355 1,476 59.6% 1,303 80.8% 3,831 2,211 73.3%Tax (1,147) (384) (176) (1,531) (314)Non Controlling Interest (55) (5) 29 (60) 59 Share of profit/(loss) from associates & JVs 580 169 (322) 749 (595)Net Profit 1,733 1,256 38.0% 833 108.1% 2,990 1,360 119.9%EPS 6.5 4.7 37.9% 3.1 108.1% 11.3 5.1 119.9% NET WORKING CAPITAL UNDER CONTROL
Cash conversion cycle at comfortable levels
FY18
FY19
H1FY20
*Includes Debtors + Inventory – Creditors – Trade Advance; Figures from FY19 are only for continuing operations on IndAS basis
27
7391131634824-103-64-60-4-57-69291825Inventory daysDebtor daysPayable daysTrade AdvanceCash Conversion Cycle VOLUME – ANNUAL TREND
Production and Sales in KMT – Pipes (including Saudi Arabian JV)
Valued at USD 2.15 Bn
Breaking out from the earlier consistent level of 1 million tonnes per annum
27
1,010 1,022 1,130 1,119 954 1,020 1,252 739 1,018 1,019 1,152 1,100 935 1,084 1,279 656 FY13FY14FY15FY16FY17FY18FY19H1FY20Pipe ProductionPipe Sales INCOME STATEMENT – ANNUAL TREND
Note: • • •
Prior period figures are restated wherever necessary; All numbers of this sheet are based on IND-AS disclosures except sales volume Pipe sales volumes are based on total operations including Saudi From FY19 figures are pertaining to continuing operations (Pipes) only
28
Rs mnFY17FY18FY19H1 FY20Pipe Sales Volume (KMT) 935 1,084 1,279 656 Revenue 60,355 75,873 89,535 43,101 Operating EBITDA 5,935 7,054 8,968 5,754 MTM Loss on Bonds (2,578) (377)EBITDA 7,370 8,147 7,077 5,722 Depreciation 3,861 3,793 2,597 1,155 Finance cost 2,357 1,853 1,774 735 Profit before tax and share of JV 1,152 2,501 2,706 3,832 Tax (258) (112) (1,223) (1,531)Non Controlling Interest 163 53 84 (60)Share of profit/(loss) from associates & JVs (793) (859) (885) 749 Net Profit 264 1,583 682 2,990 EPS 1.00 5.97 2.57 11.27 INCOME STATEMENT – QUARTERLY TREND
Note: • • • Q1 FY19 onwards, figures are pertaining to continuing operations (Pipes) only
Prior period figures are restated wherever necessary; All numbers of this sheet are based on IND-AS disclosures except sales volume Pipe sales volumes are based on total operations including Saudi
29
Rs mnQ3 18Q4 18Q1 19Q2 19Q3 19Q4 19Q1 20Q2 20Pipe Sales Volume (KMT) 318 254 267 304 339 369 319 337 Revenue 23,042 16,589 16,419 21,525 24,030 27,561 20,471 22,630 Operating EBITDA 1,448 1,376 1,741 2,494 2,075 2,658 2,585 3,169 MTM Loss on Bonds (282) (110) (2,185) (360) (17)EBITDA 1,644 1,579 1,942 2,417 2,304 414 2,416 3,306 Depreciation 949 907 558 771 654 614 545 610 Finance cost 375 411 366 454 418 536 395 341 Profit before tax and share of JV 320 261 908 1,302 1,232 (736) 1,476 2,355 Tax 565 (80) (138) (176) (447) (462) (384) (1,147)Non Controlling Interest (27) 31 30 29 22 3 (5) (55)Share of profit/(loss) from associates & JVs (195) (258) (273) (322) (236) (54) 169 580 Net Profit / (Loss) 664 (45) 527 834 571 (1,249) 1,256 1,733 EPS 2.50 (0.2) 1.99 3.14 2.15 (4.71) 4.74 6.54 BALANCE SHEET – ANNUAL TREND
Note: • • • •
Prior period figures are restated wherever necessary; All numbers of this sheet are based on IND-AS disclosures Net Assets Held for Sale = Assets or disposal groups classified as held for sale less Liabilities directly associated with disposal groups classified as held for sale Net Current Assets as on 31-Mar-19 & 30-Sep-2019 excludes Net Asset Held for Sale FY19 onwards, figures are pertaining to continuing operations (Pipes) only
30
Rs mn31-Mar-1731-Mar-1831-Mar-1930-Sep-19Net Worth 28,094 28,540 27,976 30,835 Short Term Loans 2,203 126 1,750 1,500 Long Term Loans 16,227 13,738 11,297 9,424 Gross Debt 18,430 13,864 13,047 10,924 Cash & Cash Equiv. 7,365 9,649 10,191 8,955 Net Debt 11,065 4,216 2,856 1,969 Net Fixed Assets (incl CWIP) 33,877 30,619 16,144 16,364 Net Current Assets 12,746 13,596 10,460 12,631 Net Assets Held for Sale - - 11,642 10,025 Total Assets 82,469 76,933 82,000 84,647 KEY FINANCIAL RATIOS – ANNUAL TREND
Note: • •
Prior period figures are restated wherever necessary; All numbers of this sheet are based on IND-AS disclosures From FY19 figures are pertaining to continuing operations (Pipes) only
31
FY17FY18FY19H1 FY20Net debt/Equity0.390.150.100.06Net debt/EBITDA1.500.520.400.23EBIT/Interest 1.49 2.35 2.53 6.21Current Ratio 1.42 1.49 1.56 1.56Fixed Asset Coverage 1.84 2.23 1.43 1.74Total Asset turnover 0.73 0.99 1.09 1.02Inventory days 107 73 91 131Debtor days 89 63 48 24 Payable days incl. Advances 143 107 121 130Cash conversion cycle 53 29 18 25ROE0.9%5.6%2.4%20.3%ROCE (pre-tax)6.4%8.8%22.6%29.1%Solvency ratiosOperational ratiosReturn ratios AGENDA
WELSPUN CORP: OUTLOOK
OUTLOOK - INDIA
OIL & GAS
♀ Large-diameter pipe demand driven by gas grid development by GAIL & oil pipeline network by
IOCL
♀ Recent decision by the Government to pitch in for viability gap funding for North East region pipeline
network, is another positive news.
♀ Small-diameter pipe is expected to witness significant demand from City Gas Distribution projects
WATER
♀ Entire pipe industry is expected to benefit from ‘Nal se Jal’ scheme to provide drinking water access
to all by 2024.
♀ Activity in the irrigation segment is expected to further pick up in the coming quarters.
EXPORTS
♀ With oil prices remaining stable and range-bound, LSAW demand continues to be strong across
geographies.
♀ Demand in Middle East, North & East Africa as well as Australasia looks extremely promising
♀ WCL well-placed to service this demand with:
♀ its global approvals and accreditations
♀ an impeccable track record of supplying pipes for complex projects for Oil & Gas majors
33
OUTLOOK – US & SAUDI
UNITED STATES
♀ Rising fracking in the Permian basin Booming Oil & Gas production
♀ Constrained oil & gas evacuation pipeline capacity driving pipeline demand
♀ Demand from Bakken basin and gas export demand also adding to growth
♀ Local US players incl. WCL, will continue to command higher volumes
due to:
♀ Pipeline infrastructure bottlenecks
♀ Restrictions placed on pipe imports in US
♀ WCL Saudi business continues to have strong backlog as well as visibility of
around 18 to 24 months.
♀ Current order book is driven mainly by water orders from SWCC
♀ Seeing strong traction from Saudi Aramco on the oil & gas side as well.
SAUDI ARABIA
WCL Global Bid Book at 2.6 mn tonnes and Global Upcoming Bids at 20.5 mn tonnes
34
WAY FORWARD
Higher Profitability
Strong visibility provided by current Order Book of 1,357 KMT, coupled with
Global Bid Book of 2.6 mn tonnes and Global Upcoming Bids of 20.5 mn tonnes. Profitability associated with these orders is significantly better than recent trends
likely to continue in the medium term
Focus on Core Assets
Rich legacy & expertise of delivering pipes for many prestigious & challenging
projects; thus focus on pipe business
Divestment of non-core businesses - Plate & Coil Mill Division (PCMD) and
43MW power plant
Unlocking significant value for shareholders
Leaner Balance Sheet
Focus on free cash flows by calibrating capex and effective management of
working capital
Excess cash being used for pre-paying debt and to buyback shares, thus making
the balance sheet leaner
Asset-light approach to further improve Return ratios
Rewarding Shareholders
Utilising the Company’s surplus cash reserves to enhance shareholder value Buyback of shares underway for a maximum aggregate consideration of Rs. 3.9
billion at a price of Rs. 135 per share.
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THANK AGENDA YOU
Welspun Corp Limited CIN: L27100GJ1995PLC025609
Mr. Harish Venkateswaran harish_venkateswaran@welspun.com
www.welspuncorp.com
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