Arvind Limited Performance Review Note Q4 FY th May 2015, Ahmedabad

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1 Arvind Limited Performance Review Note Q4 FY th May 215, Ahmedabad 1

2 Agenda Financial Performance: Consolidated Financial Performance: Standalone Business Analysis 2

3 Agenda Financial Performance: Consolidated Financial Performance: Standalone Business Analysis 3

4 Financial Performance: Q Consolidated revenue growth of 8% and PAT growth of 3% Moderate growth in revenues......as well as margins Rev, Rs Cr 2,5 EBITDA, Rs Cr % 26 2, 1,882 8% 2, FY FY ,5 PAT*, Rs Cr 3% , 5 5 FY FY FY FY *PAT before exceptional Item 4

5 Business Highlights: Q Moderate top-line growth with moderated bottom-line due to higher tax Change Revenue from Operations 2,41 1,882 8% RawMaterials Project Expenses Employees' Emoluments Others (Increase) / Decrease in Stock 7 19 Foreign Exchange Loss /(Gain) -5 5 EBIDTA % Margin 12.7% 12.7% Other Income Interest & Finance Cost 96 9 Cash Accruals % Depreciation Profit Before Taxes % Tax Profit After Tax % Less : Exceptional Item 48 Net Profit % Key highlights Revenue growth of 8% achieved due to 17% top-line growth in Brands & Retail 16% top-line growth in Garments PBT growth of 2%, PAT growth 3% over Q4 FY14 Despite healthy growth in PBT for the year, the PAT growth was muted due to higher tax Exceptional items: Rs. 26 crores for retrenchment of 96 workers Rs. 22 crores for settlement of legal dispute of USPA brand with Polo Ralph Lauren 5

6 Financial Performance: FY Revenue growth of 14% and PAT growth of 7% Strong revenue growth Strong improvement in operating profits Rev, Rs Cr EBITDA, Rs Cr 9, 7,5 6,862 14% 7,851 1,5 1, % 1,13 6, FY FY ,5 PAT*, Rs Cr 7% 3, , FY FY FY FY *PAT is before exceptional Item 6

7 Business Highlights: FY Strong top-line & bottom-line growth Rs in Cr Change Revenue from Operations 7,851 6,862 14% Raw Material Consumed 2,292 2,179 Purchase of Finished Goods 1,44 1,154 RawMaterials 3,696 3,333 Project Expenses Employees' Emoluments Others 2,48 2,25 (Increase) / Decrease in Stock Foreign Exchange Loss /(Gain) EBIDTA 1, % Margin 12.9% 13.3% Other Income Interest & Finance Cost Cash Accruals % Depreciation Profit Before Taxes % Tax Profit After Tax % Less : Exceptional Item Net Profit % Key highlights Revenue growth of 14% achieved due to 23% top-line growth of Brands & Retail 6% top-line growth of Textiles EBIDTA margin % slightly lower Higher weightage of Brand & Retail Business Lower textile margin PBT growth of 18% : PAT growth of 7% PAT growth lower at 7% due to higher tax Exceptional items : Rs.29 crores for retrenchment of 112 workers Rs. 22 crores for settlement of legal dispute of USPA brand with Polo Ralph Lauren 7

Margin moderated in both key business segments in FY 214-15 Quarterly margins lower than LY due to Forex loss and MegaMart Performance Textiles Brands & Retail FY comparison Vs LY EBITDA % 2 17.

8 Margin moderated in both key business segments in FY Quarterly margins lower than LY due to Forex loss and MegaMart Performance Textiles Brands & Retail FY comparison Vs LY EBITDA % % 15 1 FY % FY EBITDA % % FY MM 2.8%, Other 6.5% 5.2% FY MM 1.3%, Other 6.2% EBITDA % EBITDA % MM (2.6%), Other 6.4% Q4 comparison Vs LY % Q % Q % Q % Q MM (-1.%), Other 5.3% EBIDTA margin of textile business lower due losses incurred in two garments manufacturing plants which commenced commercial production in Q4 8

9 Consolidated Balance Sheet, as at Mar 31 st st Mar'15 As at 31st Mar'14 Shareholders' Fund Share Capital Reserves and Surplus Non Current Liabilities Shortterm Borrowings Current Liabilities Minority Interest Total Assets Fixed Assets Non -Current Investment Long Term Loans and Advances Other Non Current Assets 11 5 Current Assets Total

10 Key Financial Ratios EPS Debt / Equity Debt / EBIDTA ROCE 1.5% 13.1% 11.9% 13.8% 14.1% ROE 8.4% 12.% 11.1% 14.% 14.5% Revenue Growth 25% 2% 7% 3% 14% 1

11 Agenda Financial Performance: Consolidated Financial Performance: Standalone Business Analysis 11

12 Standlone Financial Performance Q Q4 Rs in Crs Change Revenue from Operations 1,349 1,284 5% Raw Material Consumed Purchase of Finished Goods RawMaterials Project Expenses 9 Employees' Emoluments Others (Increase) / Decrease in Stock 36 9 Foreign Exchange Loss /(Gain) -4 5 EBIDTA % Margin 15.4% 15.2% Other Income Interest & Finance Cost Cash Accruals % Depreciation Profit Before Taxes % Tax 35 9 Profit After Tax % Less : Exceptional Item 26 Net Profit % 12

13 Standalone Financial Performance FY Rs in Cr Change Revenue from Operations 5,225 4,775 9% RawMaterials 2,272 2,174 Project Expenses 8 15 Employees' Emoluments Others 1,652 1,354 (Increase) / Decrease in Stock Foreign Exchange Loss /(Gain) EBIDTA % Margin 15.8% 16.3% Other Income Interest & Finance Cost Cash Accruals % Depreciation Profit Before Taxes % Tax 1 47 Profit After Tax % Less : Exceptional Item Net Profit % 13

14 Standalone Balance Sheet, as on Mar 31 st st Mar'15 As at 31st Mar'14 Shareholders' Fund Share Capital Reserves and Surplus Non Current Liabilities Shortterm Borrowings Current Liabilities Minority Interest Total Assets Fixed Assets Non -Current Investment Long Term Loans and Advances Other Non Current Assets 8 Current Assets Total

15 Agenda Financial Performance: Consolidated Financial Performance: Standalone Business Analysis 15

16 Textiles Business: Revenue Mix in FY Rev, Rs Cr Rev. Growth % 6% 5,5 4,977 33% 4,683 5, 275 Knits 27 1% 36 Voiles 4, % 712 Garments 4, 672 3,5 3, 2,5 2, 1,5 1, 5-5 1,797 1,89-21 FY ,944 1, FY Wovens Denim Internal sale 8% 2% Textile revenue grew by 6% Led by 8% growth Woven fabrics 6% growth in garments 2% growth in Denim 1% growth on a smaller base for the voiles business 16

17 Volume growth: Wovens volume growth at 8% : Denim at 1% Denim Wovens (Shirting & Khaki) Q4 comparison Vs LY Volume, Mn Mtrs % 26. Volume, Mn Mtrs % 28.2 Q Q Q Q Volume, Mn Mtrs Volume, Mn Mtrs FY comparison Vs LY 15 +1% % FY FY FY FY

18 Key Parameters: FY Textiles Denim Woven Q Q Q Q Exports(Mn Mtrs) Domestic(Mn Mtrs) Avg Prices Major Component Cotton Cost (Rs/Kg) Denim Woven Exports(Mn Mtrs) Domestic(Mn Mtrs) Avg Prices Major Component Cotton Cost (Rs/Kg)

19 Brands & Retail Business grew topline by 17% in Q Strong revenue growth Key highlights Rev, Rs Cr Revenue growth of 17% achieved due to 25% revenue growth in Brands /other formats 6 17% 587 Flat revenue in MegaMart Retail Like to Like growth 8.2% LTL growth in Brands 2.4% LTL growth in MegaMart continuing business 3 2 Q Q *Without Arvind Internet Business 19

20 Brands & Retail Business grew topline by 23% in FY Strong revenue growth Key highlights Rev, Rs Cr Revenue growth of 23% achieved due to 31% revenue growth in Brands/Other formats 2,5 2, 1,915 23% 2,361 2% revenue growth in MegaMart Retail, as business went through a repositioning and model change to consolidate operations and restore margins 1,5 Like to Like growth 4.9% LTL growth in Brands 1, Overall LTL growth of 1.5% in Megamart Retail, despite several stores being marked for closure 5 FY FY *Without Arvind Internet Business 2

21 Performance of Power Brands Power brands Revenues Rs Cr Q % 363 Q Revenues Rs Cr 1,5 1, 5 1,68 +25% 1,334 FY FY EBITDA Rs Cr EBITDA % % 11.6% Q Q EBITDA Rs Cr % 125 FY % 152 FY EBITDA % EBITDA % EBITDA Rs Cr Revenue Rs Cr 1. Note: Tommy Hilfiger numbers reflect 5% Arvind share of the JV company 21

22 Brands & Retail Business Distribution Q Q Particulars Stores Sq Ft Stores Sq Ft Brands 8 7,89, ,56,615 MM 145 8,42, ,32,896 Total ,31, ,89,511 No of KA Exclusive Counters Sales Increase in Key Account Counters: Growth of 3% in FY

23 Outlook Revenue Growth likely to be between 15-17% primarily driven by volume growth in brands & retail business and Garments manufacturing : Revenue Growth in Textiles 9-11% Revenue Growth in Brands & Retail at about 24-26% Weighted Margins likely to up marginally on account of margin improvement of 15+ basis points in Brands & Retail Business Power Brands to continue growth momentum Improvement in margins of brands and retail formats introduced over last couple of years Closure of a few loss making formats PAT growth to be slower due to higher tax 23

24 Thank You!

Arvind Limited Q2 Review Note 5 th November 2015, Ahmedabad

Arvind Limited Q2 Review Note 5 th November 215, Ahmedabad Contents Performance Review Q2 FY 215-16 Financial Performance : Consolidated Financial Performance : Standalone Business Analysis Outlook 2 Contents