EPIGRAL

24.01.2024 To, National Stock Exchange of India Limited BSE Limited “Exchange Plaza”, Floor- 25, P J Tower, Bandra-Kurla Complex, Dalal Street, Bandra (East) Mumbai 400 051 Mumbai 400 001 SYMBOL:- EPIGRAL Scrip Code: 543332 Dear Sirs, Sub.: Earnings Presentation for Un-Audited Financial Results – Q3 FY2024 Ref.: Regulation 30 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 Pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we are enclosing herewith Earnings Presentation for Un-Audited Financial Results – Q3 FY2024. The said Earnings Presentation is also available at www.epigral.com in the Investor Relations section. This is for information and records. Thanking you, Yours faithfully, For Epigral Limited (formerly known as ‘Meghmani Finechem Limited’) Maulik Patel Chairman and Managing Director DIN: 02006947 Epigral Limited (formerly known as Meghmani Finechem Limited) Q3FY24 Earnings Presentation Disclaimer This presentation and the accompanying slides (the “Presentation”), which have been prepared by Epigral Limited (the “Company”) solely for the 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 Certain statements in this presentation concerning our future growth prospects are forward looking statements which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The Risk and uncertainties relating to the statements include, but are not limited to, risks and uncertainties regarding fiscal policy, competition, inflationary pressures and general economic conditions affecting demand / supply and price conditions in domestic and international markets. The company does not undertake to update any forward -looking statement that may be made from time to time by or on behalf of the company. This Presentation has been prepared by the Company based on information and data which the Company considers reliable. 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. The Company does not make any promise to update/provide such presentation along with results to be declared in the coming years. Company Overview Founded: 2007 30% 22% 5 Year Revenue CAGR (FY23) 5 Year EBITDA CAGR (FY23) Employees: 900+ 0.8x 32% Debt to Equity (FY23) ROCE (FY23) Capacity: Chlor-Alkali – 421 KTPA # Derivatives – 190 KTPA # Revenue from operations (₹ Cr) 2188 Certified: 1551 Responsible Care Certificate 829 710 611 Manufacturing facility: Fully-integrated & automated complex FY19 FY18 FY21 FY22 FY23 # Chlor-Alkali : Caustic Soda - 400 KTPA and Caustic Potash - 21 KTPA Derivatives : CPVC Resin – 30 KTPA, Epichlorohydrin – 50 KTPA, Chloromethanes - 50 KTPA and Hydrogen Peroxide - 60 KTPA Our Journey FY 2007 FY 2010 FY 2015 FY 2017 FY 2020 Epigral Ltd (MFL) Commissioned 1st Increased capacity to Commissioned Commissioned incorporated Plant • Caustic Potash – • Chloromethanes – • Caustic Soda – 167 21 KTPA 50 KTPA • Caustic Soda – 119 KTPA KTPA • CPP – 60 MW Converted all Announced Capex • CPP – 40 MW Membrane to Zero Gap • Epichlorohydrin – 50 KTPA FY 2021 FY 2022 FY 2023 FY 2024 Commissioned Listed as an Commissioned Renamed company from • Hydrogen Peroxide independent entity • Epichlorohydrin – 50 KTPA Meghmani Finechem to – 60 KTPA on 18th August 2021 • CPVC Resin – 30 KTPA Epigral Increased capacity to Announced Capex Increased capacity to Commissioned • Caustic Soda – 294 • Chlorotoluene & Caustic Soda – 400 KTPA • 18.34 MW Green KTPA Value Chain CPP – 132 MW Hybrid Power Plant • CPP 96 MW • Setting up R&D Centre Announced Capex Announced Capex Awarded “Responsible • 18.34 MW Green Hybrid • CPVC Compound – Care” Certificate Power Plant 35 KTPA • CPVC Resin – 45 KTPA Q3FY24 - Key Highlights Q3FY24 Operational Highlights: o YoY volume grew by 18%. Major growth came from Derivatives & Specialty segment and partially from Chlor- Alkali business o Capacity utilization stood at 81% in Q3FY24 vs 77% in Q2FY24 o On QoQ, realizations of all the products were down in the range of 1% to 7%, except for Chloromethanes, on account of weak demand Q3FY24 Financial Highlights: o QoQ, Revenue stood at ₹ 472 Cr vs ₹ 478 Cr in Q2FY24 o Revenue contribution from Derivatives & Specialty segment increased to 42% in 9MFY24 vs 27% in 9MFY23 o QoQ, EBITDA grew by 14% to ₹ 123 Cr. Margin stood at 26% vs 23% in Q2FY24 on account of increase in utilization and improvement in spreads o QoQ, PAT up by 29% to ₹ 49 Cr. PAT margin stood at 10% vs 8% in Q2FY24 o ROCE stood at 18% and Net Debt/EBITDA stood at 1.96x 9MFY24 - Key Highlights 9MFY24 Strategic Highlights: o Capex / Expansions o Epigral announced to enter into CPVC Compound with a capacity of 35,000 TPA. This expansion is expected to get commission in Q4FY24 o Epigral commissioned 18.34 MW Wind Solar Hybrid Power Plant in Q1FY24 o Epigral inaugurated its first R&D Centre in Ahmedabad in November 2023 o Expansion of CPVC Resin capacity of 45,000 TPA and Chlorotoluenes Value Chain is on schedule and expected to get commission by Q4FY24 o Epigral spent Rs. 323 Cr on capex for 9MFY24 o Meghmani Finechem Limited has been rebranded to Epigral Limited. This renaming is undertaken to strengthen the corporate brand in line with the company’s commitment to transform the company as a global multi-product chemical conglomerate and enhance our reputation as an integral partner for esteemed clients and our stakeholders CMD Message “We witnessed sales volume growth of 18% on YoY, this growth is coming from Epichlorohydrin and CPVC Resin. Increase in revenue from these new products and improvement in spreads led us to PAT growth of 29% QoQ, despite flattish revenue. Demand in the chemical industry has remained weak and we expect a pick-up in demand in the forthcoming quarters. On account of our various expansion projects and specialized products catering to diversified industries has helped us to deliver better performance compared to industry as a whole. We are moving in line with our focus on diversifying our business model by increasing revenue contribution from Derivative & Specialty segment. Nine months of FY24, revenue contribution from Derivatives & Specialty segment increased to 42% vs 27% in nine months of FY23. This contribution will further enhance as all future expansion projects are towards Derivatives & Specialty segment. Our capex for new projects are on schedule and will get commission on committed timelines. These projects that will get commission in FY2024 and few projects commissioned in FY2023 will drive volume growth for FY2025 and FY2026. We are focused to enter into import substitute products, diversifying our customer base and create value for our stakeholders.” - Mr. Maulik Patel, Chairman and Managing Director Q3FY24 Financial Highlights Revenue – YoY Growth: -12% EBIDTA – YoY Growth: -26% PAT – YoY Growth: -36% 538 31% 26% 14% 167 23% 123 10% 77 108 478 8% 472 49 38 Q3FY23 Q2FY24 Q3FY24 Q3FY23 Q2FY24 Q3FY24 Q3FY23 Q2FY24 Q3FY24 ₹ Cr Margin -% 9MFY24 Financial Highlights EBIDTA PAT Revenue 1,626 33% 1,405 17% 534 23% 277 8% 326 119 9MFY23 9MFY24 9MFY23 9MFY24 9MFY23 9MFY24 ₹ Cr Margin % Key ratios as on 31st December 2023 ROCE (%)* ROE (%)* Net Debt/EBITDA (x)* 46% 1.96 35% 1.29 18% 18% Q3FY23 Q3FY24 Q3FY23 Q3FY24 Q3FY23 Q3FY24 *TTM EBIT, PAT and EBITDA are considered for above ratios **Capital employed in ROCE includes Capital Work in Progress Revenue Transition towards Derivatives & Specialty Chemicals 73% 69% 62% 62% 56% 58% 54% 46% 44% 42% 38% 38% 31% 27% Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 9MFY23 9MFY24 - Chlor-Alkali - Derivatives & Specialty Chemical Project Update as on 31st December 2023 Capex Spends - ₹ Cr Expected % of project Product Capacity Commissioning completed Date 47 Chlorotoluene & - Q4FY24 85% its value chain 456 CPVC Resin 416 45 KTPA Q4FY24 90% (Additional) 323 CPVC 35 KTPA Q4FY24 60% Compound FY2022 FY2023 FY2024E Estimated capex to be incurred Focused on ESG ENVIRONMENT o Focused on using best technology to manage critical resources, to moderate the consumption of energy and natural resources and drive operations efficiently o Focus is to manufacture more from less, basis for environment responsibility o Entered in JV to set up 18.34 MW Wind-Solar Hybrid Power Plant for internal consumption o Intend is to minimize effluents discharge while moderating water consumption o First company to produce sustainable bio-based Epichlorohydrin o Safety protocols imbibing in the culture of the company and timely management review safety systems with quantified leading and lagging indicators SOCIAL RESPONSIBILITY o Employees – Investment in culture of excellence, timely training, scope for growth, talent investment, extensive safety provisions and supporting financially and mentally in difficult times o Community – Engaged community around manufacturing plant. Supporting them in difficult times. Deeply rooted CSR in the area of education, health & family welfare, sustainable livelihood, infrastructure and other social activities o Customers and vendors – Strong and long relation with customers and vendors. Over a period built on ecosystem of vendors and primary customers GOVERNANCE o Qualified and experienced board driving strategic decisions, ethics and values o Focus on managing the business in transparent manner with all stakeholders o All the strategic decisions are taken considering interest of minority shareholders o Reputed statutory auditor – SRBC & Co LLP o Timely disclosure of material announcements Income Statement Particulars (₹ Cr) Q3FY24 Q3FY23 YoY % Change Q2FY24 QoQ % Change Total Revenue 474 538 -12% 479 -1% Gross Profit 194 231 -16% 176 10% Gross Margin (%) 41% 43% 37% EBITDA 123 167 -26% 108 14% EBITDA Margin (%) 26% 31% 23% Depreciation 31 31 0% 32 -2% Finance Cost 20 21 -4% 21 -5% PBT 74 114 -35% 56 32% PAT 49 77 -36% 38 29% PAT Margin (%) 10% 14% 8% EPS (₹) 11.9 18.6 -36% 9.2 29% Historic Income Statement Particulars (₹ Cr) FY19 FY20 FY21 FY22 FY23 Total Revenue 720 613 831 1,555 2,196 Gross Profit 431 300 407 716 951 Gross Margin (%) 61% 49% 49% 46% 43% EBITDA 312 194 261 509 689 EBITDA Margin (%) 44% 32% 32% 33% 31% Depreciation 54 44 74 86 109 Finance Cost 25 11 29 44 66 PBT 242 141 161 383 523 PAT 183 112 101 253 353 PAT Margin (%) 25% 18% 12% 16% 16% EPS (₹) 25.1 27.0 24.3 60.8 85.0 Historic Balance Sheet Assets (₹ Cr) FY22 FY23 H1FY24 Liabilities (₹ Cr) FY22 FY23 H1FY24 Fixed Assets 1,657 1,962 2,156 Share Capital 42 42 42 Financial Assets 8 28 28 Reserves & Surplus 684 1,028 1,087 Other Non-current Assets 11 23 26 Long-Term Borrowings 557 435 432 Inventories 154 212 197 Redeemable Preference Shares 211 110 110 Trade Receivables 256 166 191 Other Non-current Liabilities 97 171 185 Cash & Bank Balances 25 15 12 Short Term Borrowings 221 332 427 Loans & Advances 0 0 0 Trade Payables 88 110 140 Other Current Assets 11 26 38 Other Current Liabilities 223 205 226 Short Term Provisions 0 0 0 Total 2,124 2,432 2,649 Total 2,124 2,432 2,649 For further information Epigral Ltd (formerly known as Meghmani Finechem Ltd), incorporated in 2007, is a leading integrated manufacturer of chemicals in India. The Please log on to website - www.epigral.com company has state of the art manufacturing facilities in Gujarat, Dahej – a leading PCPIR region in the country. Epigral’s Dahej facility is a Milind Kotecha backward and forward integrated and automated complex with a well- Investor Relations established infrastructure and Captive Power Plants. In India, Epigral is milind.kotecha@epigral.com the 1st to set up an Epichlorohydrin plant and largest capacity plant of CPVC Resin. Epigral is India’s 4th largest manufacturer of Caustic Soda, Chlorine and Hydrogen and a leading manufacturer of Caustic Corporate Office Potash, Chloromethanes and Hydrogen Peroxide. Epigral Tower, B/h Safal Profitaire, Corporate Road, Prahladnagar, Ahmedabad 380015, Epigral is strengthening its position in the specialty chemical segment by Gujarat, India expanding CPVC Resin capacity to 75,000 TPA, setting up CPVC Compound capacity of 35,000 TPA, entering into Chlorotoluene & value Manufacturing Site chain and setting up R&D centre. The company is focused on CH/1 and CH/2, GIDC Industrial Estate, Dahej, sustainable value creation for all its stakeholders and has been awarded Tal. Vagra, Dist. Bharuch – 392130, with the Responsible Care certificate. Gujarat, India