Balkrishna Industries Limited has informed the Exchange about Investor Presentation
BALKRISHNA INDUSTRIES LTD Investor Presentation - May 2021
Safe Harbor
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.
2
Performance Snapshot – Q4FY21
68,002 MT
Rs.1,750cr
Rs.558cr
Sales Volume
+17% YOY
Revenue
+26% YOY
EBITDA
+37% YOY
31.9%
EBITDA margin
+254 bps YOY
Rs.372cr
Net Profit
+45% YOY
All figures on Standalone basis
3
Achieved highest ever quarterly sales volume
Management Commentary
01
02
03
04
The demand continues to be robust in Agriculture segment across Geographies. In the other segments, demand has seen an uptick on back of increased commodity prices, infrastructure creation and pick-up in economic activity
During FY21, the company faced multiple challenges related to raw material prices and its availability. Supply chain issues was also a big challenge especially post Suez Canal fiasco. However, a resilient BKT has been able to withstand these challenges and emerged stronger by posting its highest ever annual sales volumes
For FY22, the company is guiding sales volume between 250,000-265,000 MT. We strongly believe that this demand trend is likely to continue in FY22 and years to come; however, there may be covid 19 related softness in demand leading us to give a wider range for annual guidance
The Board of Directors have recommended a final dividend of Rs. 5 per equity share subject to shareholder approval at ensuing AGM, in addition to Rs. 12 per equity share paid for 9MFY21. The total dividend paid will be Rs. 17 per equity share i.e. 850% of FV. FY21 Dividend payout will be ~28%
4
Sales Volume Profile – FY21
In MT
199,213
172,419
+7%
211,261
227,131
Lockdown Impact
201,760
FY17
FY18
FY19
FY20
FY21
FY22 Sales volume guidance: 250,000-265,000 MT
5
Volume Profile – FY21
Segmental Sales
Channel Sales
Geographical Sales
Others
4%
OTR
32%
Others
4%
OEM
26%
64%
Agriculture
Replacement
RoW
13%
23%
70%
India
15%
Americas
50%
Europe
6
Profit & Loss
Particulars (Rs.Cr)
Q4FY21 Sales (MT) 68,002
Q4FY20
Growth
FY21
FY20
Growth
57,966
17%
227,131
201,760
13%
Standalone
Revenue from Operations Realized Gain on Foreign Exchange
1,746
1,357
4
32
5,758
4,782
-18
115
Total Income
1,750
1,389
26%
Raw Material
(Increase) / Decrease in Stock
Employee Expenses
Other Expenses
EBITDA
EBITDA Margin
Other Income
Unrealized Gain / (Loss)
Interest & Finance Charges
Depreciation
Tax
Profit Before Tax
PAT
776
-54
88
383
558
519
86
75
302
407
31.9%
29.3%
20
23
2
103
495
122
372
38
-6
2
98
339
81
257
PAT Margin
21.3%
18.5%
37%
17%
31%
5,740
2,452
-149
326
1,302
1,810
31.5%
119
18
10
406
4,898
2,078
49
286
1,104
1,381
28.2%
117
-0
7
368
46%
1,531
1,123
36%
45%
376
1,155
20.1%
178
945
19.3%
22%
7
Net Forex Gain/(Loss)
Particulars (Rs. Cr)
Foreign Exchange Fluctuation on Sales
Foreign Exchange Fluctuation on Others
Total Realised Gain/(Loss) – A
Total Unrealized Gain/(Loss) - B
Standalone
Q4FY21
Q4FY20
FY21
FY20
4
12
16
23
32
3
35
-6
-18
42
24
18
115
17
132
-0
Net Forex Gain/(Loss) = A + B
38
29
42
131
8
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
Mar’21
Mar’20
Particulars (Rs. Cr.)
Mar’21
Mar’19
5,649 3,247 856 86 1
1,026 15 70 348 2,391 909
392 730
34
23
4 35 264 8,040
4,854 3,189 586 86 2
712 13 90 177 1,877 580
351 649
23
22
4 14 232 6,731
EQUITY AND LIABILITIES
EQUITY
Equity Share Capital
Other Equity
Non-Current Liabilities
Financial Liabilities
(i) Borrowings
(i) 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
TOTAL
6,007
5,028
39
39
5,969
4,989
262
238
1
0
25
204
33
2
0
24
178
34
1,771
1,465
892
633
75
165
5
859
361
165
75
4
8,040
6,731
9
Cash Flow
Particulars (Rs. Cr.)
Operating profit before working capital changes
Changes in working capital
Cash generated from operations
Direct taxes paid (net of refund) and others
FY21
1,798
-80
1,719
-356
FY20
1,402
57
1,459
-295
Net Cash from Operating Activities
1,363
1,164
Net Cash from Investing Activities
Net Cash from Financing Activities
Net Change in cash and cash equivalents
-1,159
-194
10
-656
-521
-13
All figures on Standalone basis
10
Resilient Business Model
Long Term Debt Free with Cash and Cash equivalents of Rs. 1,475 Cr as on 31st March 2021
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
New Capex planned
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
11
Capex Program of Rs. 1,900cr
Brownfield Tire Plant
▪ Debottlenecking and Brownfield expansion along with addition of balancing and ancillary equipment at Bhuj ▪ Expansion to add ~50,000 MTPA capacity; expected
completion by H2FY23
▪ Capex cost of up to Rs. 800cr
▪ Current achievable capacity at 115,000 MTPA. With successful addition of new customers, carbon black capacity is planned to be increased to 200,000 MTPA including 30,000 MTPA of high value advanced carbon material and Power Plant
▪ Facility will allow larger control over supply chain while fulfilling internal demand on expanded capacity of Tires and meeting increased demand from 3rd parties
▪ Capex cost of up to Rs. 650cr; expected completion
by H1FY23
▪ Modernization,
technology upgradation of certain existing equipment and install automated material handling systems
automation
and
▪ Capex to be undertaken at existing facilities at in
leading to improvement
Rajasthan and Bhuj quality and efficiency
▪ Capex cost of up to Rs. 450cr; expected to be
completed by H1FY23
Carbon Black and Captive Power Plant
Modernization, Automation and Technology Upgradation
✓ Rs. 1,900cr Capex to be funded
by Internal Accrual and Debt, if
required
✓ Post Brownfield capex achievable
capacity of Tire Plant will stand
at 335,000 MTPA
✓ Embarking on new capex in
Carbon Black on back of Proven
quality of product coupled with
strong demand consumption and 3rd parties.
for
captive
✓ Modernization capex to lead to
better efficiency
12
Strategy at BKT
13
Our Focus Area
01
05
02
03
04
Market Reach Expand reach within existing Sales Channels as well increase footprint within replacement segment and OEMs
Penetrate Americas Increase share of business in USA markets by increasing supplies from India
Product portfolio expansion Expand the product portfolio by adding large sized tires and strengthen relationship with Customer base
Indian Markets Strengthen our distribution channels within Indian Markets
Utilization Reach 100% utilization levels at Bhuj Plant in the next few years
14
To Serve Global OEMs…
The Brand Names mentioned are the property of their respective owners and are used here for identification purposes only
15
With India Production and Global Sales
Waluj, Maharashtra
Bhiwadi, Rajasthan
Chopanki, Rajasthan
Bhuj, Gujarat
Mould plant, Dombivali
Our plants
India – Our Manufacturing base
16
Balkrishna Industries – A Snapshot
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 2,700 SKUs
Capacities
Achievable capacities of ~285,000 M.T.P.A
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
17
Our Strong Evolution
Self Reliant on Carbon Black with the completion of Phase 2 at Bhuj in Gujarat
2 0 2 0
Started Manufacturing for large size 51” diameter tires at Bhuj
2 0 1 9
Crosses Rs. 1,000 cr Turnover
Production of ATV, Gardening and earthmoving Tires
2 0 0 9
2 0 0 3
Rebranding of BKT
Launch of Radial Agrimax Tires
2 0 1 1
2 0 0 4
Started Greenfield Plant in Bhuj, Gujarat
Plant in Chopanki, Rajasthan
2 0 1 5
2 0 0 6
Announced Capex at Waluj and Bhuj
2 0 1 8
Launch of Earthmax Tires
Plant in Bhiwadi, Rajasthan
2 0 0 2
Started Production of Off-Highway Tires
1 9 9 5
1st Plant in Aurangabad inaugurated by our Founder Chairman, Late Mr. M P Poddar
India’s Largest Off-Highway Tire Manufacturer
2 0 0 8
1 9 8 7
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BKT… at the forefront of Sustainability
• Part of electricity needs of the North India plants are being met by green
energy generated through our own wind and solar projects
•
In Bhuj, the Company’s largest production site, the company has
o Planted over 100,000 trees o Created two large water reservoirs and o Set up a co-generation plant for self-efficiency
‘Sustainable Business Operations’ is core to our Business ethos
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Application of our Tires
s e r i T e r u t l u c i r g A
s e r i T
l a i r t s u d n
I
s e r i T R T O
Cotton Pick Harvester
Tractor
Vineyard Tractor
Pivot Irrigator
Loader
Telehandler
Mobile Crane
Load Haul Dump
Underground Mining
Container Handler
20
BKT – A Strong Global Brand from INDIA
21
Strengthening BKT Brand : Americas
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
22
Strengthening BKT Brand : Canada
BKT Continental Cup – Curling: BKT is the Title Sponsor of Continental Cup
23
Strengthening BKT Brand : Italy, Europe
BKT is the Title Sponsor for the ITALIAN SERIE ‘B’ FOOTBALL CHAMPIONSHIP – THE NEWBORN - “SERIE BKT”
24
Strengthening BKT Brand : Spain, Europe
BKT is the Official Global Partner for the Spanish Football League “La Liga”
25
Strengthening BKT Brand : France, Europe
BKT is the Sponsor for the “LIGUE de Football Professionel (LFP)” in France
26
Strengthening BKT Brand : Europe
Premium Partner of EUROLEAGUE BASKETBALL
27
Strengthening BKT Brand : Tractor of the year (TotY) - EUROPE
Team of 26 expert journalists in agricultural mechanization, assign the Tractor of the Year (TotY) award to the ‘Best European Tractor’
28
Strengthening BKT Brand : Australia
BKT is the Official “OFF-HIGHWAY TIRE PARTNER” for KFC BIG BASH LEAGUE (THE AUSTRALIAN CRICKET LEAGUE)
29
Strengthening BKT Brand : India
Official Partner of Teams in the Cricket T20 League
30
For further information, please contact:
Company :
Investor Relations Advisors :
Balkrishna Industries Ltd. CIN - L99999MH1961PLC012185 Mr. M S Bajaj President (Commercial) & CFO
www.bkt-tires.com
Strategic Growth Advisors Pvt. Ltd. CIN - U74140MH2010PTC204285 Mr. Shogun Jain shogun.jain@sgapl.net +91 77383 77756 www.sgapl.net