CORPORATE PRESENTATION

Transcription

1 CORPORATE PRESENTATION February, 2011

2 Disclaimer Corporate Presentation (the Presentation ) of Hindusthan National Glass & Industries Limited (HNG), as contained in this document, is based on management estimates and is being provided to you (herein referred to as the Recipient ) only for information purposes. The sole purpose of this Presentation is to provide preliminary information on the business activities of the Company, in order to assist the recipient in understanding the Company. This Presentation does not purport to be all inclusive or necessarily include all information that a prospective investor may desire in evaluating the Company. The Company expressly disclaims any and all liability for any errors and/or omissions, representations or warranties, expressed or implied, as contained in this document. This Presentation contains certain forward looking statements, which are based on certain assumptions of future events over which the Company exercises no control. Hence this involves number of risks and uncertainties which could cause the actual results to differ materially from those that may be projected or implied by these forward looking statements. Such risks and uncertainties include, but are not limited to: Company s ability to manage growth, competition, attracting and retaining skilled professionals, time and cost overruns, regulatory approvals, market risks, domestic and international economic conditions, changes in laws governing the Company including the tax regimes and exchange control regulations. The Company does not undertake to update any forward looking statements that may be made from time to time by or on behalf of the Company. This Presentation may not be photocopied, reproduced or distributed to others at any time without prior consent of the Company. Upon request, the Recipient will promptly return all material received from the Company without retaining any copies thereof. In furnishing this Presentation, the Company does not take any obligation to provide the Recipient with access to any additional information on the Company or its Subsidiaries. This Presentation should not be deemed an indication of the state of affairs of the Company nor shall it constitute an indication that there has been no change in the business or state of affairs of the Company since the date of publication of this Presentation. Any clarifications / queries, as well as any future communication, regarding the Company should be addressed to the Company. This presentation does not constitute a prospectus, offering circular or offering memorandum or an offer, invitation, or a solicitation of any offer, to purchase or sell or subscribe, any shares of the Company and should not be considered or construed in any manner whatsoever as a recommendation that any person should subscribe for or purchase any of the Company s shares. 2

3 Table of Contents Introduction of the Company Industry Snapshot Business Overview Float Glass Business Business Strategy and Expansion Plans Financial Snapshot 3

4 Introduction of the Company

5 Overview Growth in respective Economies Industry leader market share ~ 55% Diversified customer base across all market segments Pan-India presence Successful turn around of loss making acquisitions Strong focus on value creation through strategic initiatives Robust start in high growth oriented Float Glass business Decline Low growth Medium growth High growth Not illustrated Professionally run organization with competent management HNG: Unique and only of its kind in high growth Indian market 5

6 Vision To create a world-class glass manufacturing plant that pursues Quality, Cost Reduction, and Productivity Improvement measures in a truly holistic manner, leading to Customers, Shareholders, Employees and Suppliers Satisfaction; this integrated effort will result in the Company becoming an Industry Benchmark and a role model for systems, processes and results 6

7 Corporate history Key events 2001 Expansion of capacity to 1,100 tonnes per day 2005 Acquisition of the glass division of L&T at Nashik Set up Float Glass plant in Halol - Acquisition of the Neemrana unit of Haryana Sheet Glass (capacity 125 tpd) Work on 7 th plant at Naidupetta (650 TPD) started at full swing (operations to commence by Mar-12) -650 tpd of additional capacity announced in Nashik, production expected by Nov, Company laid the foundation stone for its first plant at Rishra 2002 Acquisition of plants at Rishikesh and Puducherry from Owens 2006 Merger with associate, Ace Glass Containers Ltd 2009 Rated as the best Indian company in the Glass & Ceramics category by Dun & Bradstreet 7

8 Corporate structure Hindusthan National Glass & Industries Ltd - Consolidated net revenues: INR 13,834 m - Standalone net revenues: INR 13,599 m Glass Equipment (India) Ltd. 100% 100% Quality Minerals Ltd 47.4% 1 HNG Float Glass Ltd (HNGFL) Capital Goods & Spares Supplier to Glass Industry Net revenues: INR 366 m Mineral Supplier to Glass Industry Net revenues: INR 29 m Manufacturer of Float & Processed Glass Net revenues: INR 275 m Note: 1 HNGFL is proposed to be made a Subsidiary 2 All figures of revenues are of FY All Values are in INR million 8

9 Organization HNG Board Chandra Kumar Somany, Chairman HNGIL Board of Directors Chandra Kumar Somany Sanjay Somany Mukul Somany Kishore Bhimani Sujit Bhattacharya Ratna Kumar Daga Shree Kumar Bangur Dipankar Chatterji Indrajit Kumar Saha Venkatasan Sridar Sanjay Somany, VC & MD Mukul Somany, VC & MD Manufacturing Marketing Finance Purchase Commercial HR & Admin Professionally managed organization with clear delegation of responsibilities and authority. 9

10 Shareholding pattern Particulars % Shareholding (as on February, 2011) Promoters Public Shareholding Insurance Companies Bodies Corporate 2.67 Financial Institutional Investors 7.27 Individuals & Others* Total * Includes 16.76% held as Treasury Shares in the Company Total 87.4 million shares of face value of (INR. 2.00) each. Listed at: National Stock Exchange (NSE) Bombay Stock Exchange (BSE) Calcutta Stock Exchange (CSE) 10

11 Overview Current capacity of 2,825 Tpd producing over ~ 15m bottles per day ranging from 5 ml to 3200 ml Expanding to ~ 4,150 Tpd over the next 2 years Standalone operations 30,000 25, % 20,000 15,000 7,016 10,000 5,000 1,175 Successfully combated the impact of recession and increase in global crude prices 21.0% 10,212 13, % 2,147 2,359 Sales CAGR: ~ 25% PBITDA CAGR: ~ 39% 23.3% 25% 13,599 20% 15% 10% 3,163 5% - FY2007 FY2008 FY2009 FY2010 Net Revenue (INR m) PBITDA (INR m) PBITDA margin 0% 11

12 Pan India presence Manufacturing locations in all regions in the Country Pan-India presence enables : Lowering overall landed cost to Delhi customers and ensuring JIT supplies. Kolkata Comprehensive coverage of the key customers across India Fleet of 100 Trucks Mumbai Hyderabad Naidupeta Bengaluru Chennai Plant Locations Marketing Office Upcoming Greenfield Mega Project 12

13 Inorganic growth January 2002 Acquired Owens Brockway India Ltd, a subsidiary of Owens Illinois, USA. Capacity acquired: 700 Tpd (plants at Puducherry and Rishikesh). Closed the 3 rd October 2005 commercially notviable. plant of the Company at Pune, since Acquired loss making unit of Larsen & Toubro Capacity acquired: 320 Tpd (at Nashik) October 2007 Acquired the assets Container Glass division of Haryana Sheet Glass. Capacity acquired: 180 Tpd (at Neemrana) Successful turnaround of loss making businesses demonstrates strong management capabilities 13

14 Ratings, Rankings & Accreditations Business Standard Ranking (Out of 1000 top listed corporates, as of Feb 10) In terms of Revenue 299 th On Operating Profit Quantum 265 th On Net Profit Quantum 253 rd Rating by CARE (Credit Analysis & Research Ltd.) Long Term credit rating of AA+ (implying high safety for timely servicing of debt obligations and carrying very low credit risk). Short Term credit rating of PR1(+) (implying the lowest credit risk). CRISIL Equity Rating On Fundamental side 4/5 meaning Superior Fundamentals On Valuation Side 3/5 meaning Align (+ - 10% from CMP) Rated as the best Indian Company in the Glass & Ceramics category by Dun & Bradstreet in year 2009 Accredited with ISO 9001:2008 certification, ensuring stringent quality standards and ISO for food andsafety Rated at No.35, out of the best 500 companies by Inc.India(Comprehensive ranking of India s best performing mid-sized companies) in their Sep-Oct, 2010issue. 14

15 Industry Snapshot

16 Global packaging industry As per World Packaging Organization, the global packaging industry at present is estimated to be US$ 500 bn in revenues, with ten year historical growth at ~ 3.1% CAGR Projected to grow at ~ 3.6% CAGR in the next five years mainly driven by growth in emerging markets (Asia Pacific region) 6.3% 7.0% 3.4% 3.2% 3.6% 3.1% 0.7% 0.5% 0.4% 0.2% Asia Pacific Latin America Europe North America Global 10-year historical growth ( E) Forecasted growth ( E) Source: Owens-Illinois, Inc. - Investor presentation, March

17 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY Indian macroeconomic overview 10.0% 7.5% 5.0% 2.5% 7.5% 9.4% 9.9% 9.0% 6.7% 7.4% % % % 23% % % % 30% 25% 20% 15% 10% 5% 0.0% 0 0% GDP growth rate Total Population (m) % Urban India is the seventh largest Country by geographical area and the second-most populous Country in the world. According to IMF estimates, India s GDP is expected to grow by 8.5% in the current year. 17

18 Indian Glass Packaging Industry At US$ 14 bn, Indian packaging industry has been growing at ~ 15% over the last few years World glass container per capita consumption Expected to accelerate further with increasing urbanization, growing middle class and expansion of South Korea (kg) 89.0 modern retail France 63.9 Indian glass container market stood at US$ 1 bn plus in FY10 Spain 50.3 with a growth of ~ 12% Entry barrier owing to capital intensive nature UK USA Top 3 players are HNG, Piramal Glass and AGI Mexico 19.5 Glaspac Japan 10.2 Low per capita glass container consumption of 1.4 kg in India as compared to 27.5 kg. in US and 10.2 kg. in Japan Strong economic drivers for end-user segments (liquor and beer, pharmaceuticals, food, cosmetics, etc.) China Brazil India Indonesia

19 Liquor Cases in millions Size of Indian IMFL market is estimated to be ~ US$ 4.5 bn with total sales volumes of 236m cases Industry projected to grow at 10-12% p.a. over next few years Growth Drivers: Low per capita consumption in India of 1.8 litres as against 8.7 litres in Europe and8.5 litres in USA Increasing disposable incomes Youth & Middle-Aged population expected to increase from ~ 48% of population (2001) to 54% in 2011 ~ 485m people in the drinking age and another 100m likely to be added over next 5 years Cultural change acceptance of social drinking and growing drinking habits in women Increasing deregulation by state governments HNG Supply Liquor Industry Volumes Increasing awareness of health & hygiene issues leading to greater usage of new glass bottles. 19

20 Beer Cases in millions Size of industry in terms of volumes: 191 m cases Industry projected to grow at 12-15% p.a. over next few years Growth Drivers: Low per capita consumption in India of 1.3 litres, compared to global average of24 litres Increase in disposable income Increasing exposure to beer, mainly due to increase in HNG Supply Industry Volumes number of outlets Rising popularity of beer among urban working women Branding efforts of beer producing companies is also Given the growth of beer industry in India, there is large potential for the new glass bottles. adding growth of newglass bottles in the segment 20

21 Food As per Government of India s Vision 2025, the food processing Figures in MT HNG Glass bottles industry is expected to more than double in size from the current US$ 70 bn to ~ US$ 150 bn in 2025 CAGR: ~15% 100,625 Growth Drivers: Increase in disposable income Changing lifestyles of urban and rural middle class Increasing health consciousness with shift from traditional unpackaged formats to packaged, branded goods Increasing working women population Increase in penetration of glass containers currently 10-12% of all food and beverages are packed in glass containers in India as compared to 40-50% in developed markets 66,040 FY2007 FY

22 Soft Drinks The Indian soft drinks market is estimated to be ~ US$ 1.8 bn with carbonated drinks contributing US$ 1.5 bn and juices US$ 0.3 bn Overall industry growing at ~ 8% p.a. with fruit drinks/ juices category growing at ~ 25% p.a. Growth Drivers: Figures in MT HNG Glass bottles CAGR: ~ 38% 19,731 51,852 India s consumption amongst one of the lowest in the world at 5 bottles (equivalent to 8 oz) p.a. Increase in disposable income Increasing penetration in rural India Introduction of healthier fruit based substitutes / juices and energy drinks to tap newer market aspirations FY2007 FY

23 Pharmaceuticals India's Pharmaceutical Industry is the 3 rd largest in the world in volume terms and 14 th in value terms Figures in MT HNG Glass bottles 95,009 The Indian domestic market is currently ~ US$ 12.3 bn and is growing atcagr of 12-15% as against a global average of 4-7% Projected to grow to US$ 20 bn by ,460 Growth Drivers: Increase in disposable income Increased health awareness Expansion of healthcare facilities in the rural and far-flung areas to further boost demand FY2007 FY2010 Glass Bottle market has experienced a de-growth of 5% CAGR due to penetration of PET Bottles Increasing penetration of customized insurance plans would drive affordability of healthcare services 23

24 Business Overview

25 Summary Largest Glass Container manufacturer in India (~ 55% volumes) with about six decades of experience. Present capacity of 2,825 tpd with proposed expansion to ~ 5975 tpd by FY14. Robust financial position During the period of FY07 to FY10, standalone sales grew at a CAGR of 25% while PBITDA grew at a CAGR of 39% Enjoys economies of scale owing to size and has best in class PBITDA margins Strong manufacturing platform spread across India through six manufacturing units, with additional Greenfield project being executed at Naidupeta, A.P and Nashik. Markets container products to several top clients including United Spirits, SAB Miller, HUL, Nestle, Glaxo, Heinz, etc. Highly experienced and competent management team Compliance with Health, Environment and Safety regulations in India Group is committed to CSR 25

26 Competitive benchmarking Player Market Cap (INR) Capacity (tpd) Sales (consolidat ed) FY10- INR HNG bn 2, bn Piramal Glass 8.46 bn 1, bn Other comments Produces glass bottles to liquor, beer, pharmaceuticals, food and carbonated drinks industries Produces glass bottles for cosmetics, pharma, food and beverages for both domestic and international markets Key segment: Cosmetics & Pharma Vitrum Glass NA 130 NA Produces amber glass containers for pharma Haldyn Glass 0.74 bn bn Produces glass bottles for liquor, cosmetics, pharma, food and beverage Glass Division named AGI Glaspac Hindusthan Sanitaryware 8.65bn * bn Produces glass bottles for liquor, pharma, food and beverage *Total revenues of the company ( includes revenues from sanitary-ware business) 26

27 Volume Mix (9m FY11) End user segment Others 1 11% Geography East 22% Pharma 10% West 13% Food 11% Beer 15% Liquor 53% South 20% North 45% 1 Others includes soft drinks 27

28 Customers Some names Liquor Beer Food Carbonated drinks (Soft drinks) Pharmaceuticals 28

29 HNG s Share of Top 10 Customers HNG's Share in the Total Requirement of Top 10 Customers in (%) United Spirits Limited United Breweries Limited Pernod Ricard India SAB Miller India Allied Blenders & Distillers Coca Cola India Pepsico India Bajaj Corp Limited Shiva Distilleries John Distilleries Limited 29

30 Manufacturing Facilities Plant details: Rishra (West Bengal) Description Year of start of operation Installed capacity Production in FY10 Furnaces Other comments 1952 (Area: 38.3 acres) 805 tpd 207,748 MT 3 (13 manufacturing lines) On-site bottle printing facility Amber, flint and green glass manufacturer Rishra 30

31 Manufacturing Facilities (contd.) Plant details: Bahadurgarh (Haryana) Description Year of start of operation Installed capacity Production in FY10 Furnaces Other comments 1964 (Area: 57.9 acres) 655 tpd 180,831 MT 3 (15 manufacturing lines) On-site bottle printing facility with four decorating lines Amber and flint glass manufacturer Foundry and mould workshop Energy feed through captive power generating facilities Bahadurgarh 31

32 Manufacturing Facilities (contd.) Plant details: Rishikesh (Uttarakhand) Description Year of acquisition Installed capacity Production in FY10 Furnaces Other comments 2002 (Area: 14.3 acres) 425 tpd 116,054 MT 2 (1 furnace used for Green glass manufacture; 6 manufacturing lines ) On-site printing facility with three decorating lines Green, flint and Georgia green Rishikesh 32

33 Manufacturing Facilities (contd.) Plant details: Puducherry (Union territory) Description Year of acquisition Installed capacity Production in FY10 Furnace Other comments 2002 (Area: 46.5 acres) 370 tpd 114,745 MT 1 (4 manufacturing lines) On-site printing facility with three decoration lines Sand beneficiation plant, foundry and mould workshop Puducherry 33

34 Manufacturing Facilities (contd.) Plant details: Nashik (Maharashtra) Description Year of acquisition Installed capacity Production in FY10 Furnace Other comments 2005 (Area: 70.3 acres) 390 tpd 109,127 MT 1 (4 manufacturing lines) On-site bottle printing facility with three decorating lines Flint glass Nashik 34

35 Manufacturing Facilities (contd.) Plant details: Neemrana (Rajasthan) Description Year of acquisition Installed capacity Production in FY10 Furnace Other comments 2007 (Area: 12.3 acres) 180 tpd 56,795 MT 1 (3 manufacturing lines) Manufactures flint and amber glass Neemrana 35

36 Technological Strengths State-of-the-art Technology from Global Majors in place to further boost operational efficiencies and product quality which includes: Batch-houses from Zippe (Germany) Furnaces from Sorg and Horn (Germany). Furnace control System from STG( Germany ), Sorg ( Germany ) and Horn ( Germany). Distributor and Forehearths from Emhart (USA), BHF ( the UK). Supervisory Control and Data Acquisition systems from Siemens ( Germany). IS machine electronic control system from Bottero (Italy) and Futronics (Germany). Parallel mold brackets machines AIS(Emhart Switzerland ) and E- MOC (Bottero -Italy). Plunger mechanism and Process Control equipment from Quantum TFA ( USA ), Emhart -PPC( Switzerland) and HEYE ( Germany). NNPB Development Technology from HEYE ( Germany). Hot End Cullet Return System from Zippe ( Germany ) and Carmet ( Italy). Annealing & Decorating lehrs from Pennekamp ( Germany ) and Carmet ( Italy). Surface treatment equipment from Graphoidal ( the UK), Pennekamp ( Germany), Arkema (The Netherlands ) and IMACA (The Netherlands ). Hot End ware handling equipment from Heye International (Germany), Pennekamp ( Germany) and Sheppee (the UK). Bottle printing equipment from Strutz (USA) and Rosario (The Netherlands). Bottle inspection machines from SGCC MSC (France), Heye International (Germany) and IRIS (France). 36

37 Supply chain Procurement Sourcing and Service contracts with various global parties Strong procurement and supply chain systems in place with diversified supplier base to de-risk operations Key raw materials include: silica, limestone, dolomite, feldspar, soda ash and cullet Marketing and Distribution Presence of multiple manufacturing locations across the country presents a strategic advantage over its peers yielding higher Net Sales Realization (NSR) due to lower freight cost to the customers Flexibility to offer JIT supplies due to lower lead Strategic acquisitions helped increase the geographic footprint and customer penetration Six marketing offices spread across India In-house fleet of over 100 trucks to de-risk supply side logistics Over 90% customers are B2B 37

38 Environment, Health and Safety Compliance with all EHS (Environment, Health and Safety) related legislations Emission standards maintained within norms Focus on zero discharge and recirculation of water CDM projects are registered. More are in the pipeline Qualified safety professionals at each plant Periodical risk assessments and safety audits 38

39 Corporate Social Responsibility The group remains committed to CSR and some of the programs embarked upon are: Provision of street lighting and maintenance of a children s park in the colony (Tulsi Vihar) adjacent to the plant at Rishikesh Sunetra Eye Clinic The Group started an eye check-up centre for underprivileged citizens in collaboration with Calcutta Eye Research Foundation School operated at Bahadurgarh (Bal Bharti) that caters to the education requirements of most of the children in the vicinity. 1,700 students registered under CBSE curriculum Donated Rs ~1.2 million to few social organizations and Handicapped University, Chitrakoot. Training programs conducted for underprivileged girls. Regularly conducts free medical camps Undertaken plantation of trees in large numbers Maintenance of park Maharana Pratap Square in Kolkata 39

40 Float Glass Business

41 Summary Strategic move by Company to venture into higher margin Float Glass industry with associate HNG Float Glass (c.47% shareholding) Proposed to be made a subsidiary Indian Float Glass industry has been growing at c.18% CAGR over the last three years Growth drivers Low per capita consumption of Float Glass in India of 1.0 kg as compared to 12 kg in China and 10.4 kg in USA Growth in real estate and automobile sector in India Greenfield expansion in the float glass business by setting up a plant at Halol, Gujarat Manufactures glass to meet the needs of Construction and Auto sectors Existing facility is an integrated glass plant having capacity to manufacture toughened, insulated glasses for architectural and automotive application. Largest domestic players well positioned to capitalize on the high growth potential Capacity: 600 tpd set up at a capex of INR 6 bn Commenced production in Feb 10. Company marketed 16,147tonnes in FY 2010 Fully positioned to break-even in the first full year of operations expected to generate small profit in FY

42 Market overview Nascent industry in India with a per capita consumption of 1.0 kg as against China (12 kg), ASEAN ( kg), Europe (12.5 kg) and USA (10.4 kg) India has eight float glass lines compared with 196 in China India s total installed capacity for float glass is estimated to be c.4,700 tpd In FY10, imports were estimated at 0.1 m MT, largely from China and Indonesia. To support indigenous manufacture, the Government imposed an anti-dumping duty of US$ 130 per ton on imports from China & Indonesia. Growth drivers Growth in real estate driven by Growth in the services sector - telecom, financial services, IT & ITeS etc Boom in retail marketing through shopping malls Increasing demand for affordable housing and high rate of urbanization Growth in automobile sector mainly driven by growth in passenger car segment 42

43 Overview of HNG Float Glass Ltd Overview Commenced production in a record time of 21 months Plant achieved global production efficiency benchmarks within a short span of 5 months Competitors include Saint Gobain, Asahi, Gujarat Guardian, Gold Plus, Sejal, etc. Certifications - Materials manufactured as per European standards EN and ASTM C (U.S. standards). Certification for integrated management system confirming to ISO 9001 &14000, OHSAS Procurement of raw material Diversified supplier base for each raw material to reduce any business risks on account of nonsupply c.18% of raw material is sourced within km and 20% of the production is sold within 500 km Product has been well received in the market and the Company has been increasing presence with a distribution network of 758 agents spread across India 43

44 Competitive benchmarking Player Installed capacity (tpd) Dealer network in diff geographical regions in India North East West South Total HNGFL Saint Gobain Asahi Gujarat Guardian Gold Plus Sejal

45 Business Strategy and Expansion Plans

46 Key Success Factors Size and Strength of the Balance Sheet: Provides flexibility and power to negotiate with suppliers and customers Enables the Company to build capacity and pursue expansion plans Cost management and optimal utilization of resources (manufacturing assets) Ability to manage costs and suitably placed to pass increases (if any) to the customer Ability to sweat the assets to the maximum extent for delivering better operational results Strong technological capabilities Ability to innovate and provide customers with optimized product, ensuring sustainable competitive advantage in the market Well diversified spread across verticals and segments Presence across entire primary end user industries and customer segments HNG s Status Market share of ~ 55% Low debt/equity of 0.35x Strong credit rating of AA+ (Long term) Diversified supplier base Strong focus on margin improvement Backward integration to reduce costs Optimum utilization of furnace capacities Introduction of NNPB technology Technology tie up with global majors including JV with OMCO, Belgium Presence across key user industries liquor, beer, pharmaceuticals and food Planning entry into Perfumery segment 46

47 Strategic initiatives Emerge as a value driven manufacturer through increasing production of light weighted bottles thus enhancing margins Setting up of a large Glass Manufacturing complex at Andhra Pradesh and proposed Greenfield projects in North and West India Implemented high quality information systems (Business Intelligence modules and Performance Management Systems) to closely monitor and improve key operating metrics Leverage capabilities of acquiring and turning around underperforming global assets by replicating the model already successfully achieved in India Higher complimentary cost advantages in sourcing higher volumes of IS machines and spares from GEIL, 100% subsidiary Reinvest in fresh capacity to continue to take advantage of significant end user industry growth Increase capacity of container glass by 3,150 tpd in next 5 years Acquired four units in last eight years to enhance competitive edge by increasing geographic presence and acquisition of new customers Leveraged existing relationships with customers and service their growing needs in other countries with supplies being made out of facilities in India 47

48 Strategic initiatives (contd.) Brought modern management practices into play to enhance production, reduce cost and strengthen overall efficiency (introduced NNPB technology in 2008) Emerge as a leading player in the Float Glass container business in India Current market share of 15% and projected to grow further Further capacity of c. 1,000 tpd planned to be added to existing capacity of 600 tpd Captive mining for silica procurement for Rishra plant (West Bengal) and Float Glass plant (owned by HNGFL) Technology tie up with Global majors Implementation of information systems to closely monitor and improve key operating metrics 48

49 Expansion plans Greenfield in Andhra Pradesh Greenfield in North Greenfield in West Maintenance capex/ Rebuild Capacity addition (tpd) Investment 650 INR 7.0 bn Other comments Land has already been allotted Project commenced from July 10 Targeted project completion date is Mar INR 6.0 bn Land under identification 650 INR 6.0 bn Procurement of equipment for the new facility Civil work to commence soon 1,045 INR 11.4 bn Maintenance and furnace rebuilds Other expansion plans include Acquisitions (domestic and international) and would be guided by the value buy proposition, as in the past JV with OMCO, Belgium for Moulds/ Moulds Accessories 49

50 Enhancing margins Shift to gas in manufacturing process, by replacing Furnace Oil and LPG at Bahadurgarh and Neemrana; agreement signed with Essar for supply of Coal Bed Methane to Rishra plant Designing and mould manufacturing facility in the Company, with own Foundry Proposed JV with OMCO, Belgium to provide further cost advantage Economies of scale in procurement of Raw Materials/ Consumables Competitive advantage in sales quantity and pricing Introduced NNPB for the first time in India thus reducing bottle weight and producing more bottles, boosting margins Sand Mining Bankura, Sand beneficiation plant for Rishra unit Bahadurgarh Currently exploring opportunities for other plants as well. Assurance of long term supplies, economy and better quality Increase in transportation fleet ensuring both economy and in-time delivery 50 Already in place Neemrana Commenced in September, 2010 Rishra Expected by April, 2011

51 Financial Snapshot

52 Consolidated P&L All values in INR million Particulars FY08 FY09 FY10 Net Revenue 10,291 13,305 13,834 Net Revenue growth 46.7% 29.3% 4.0% PBITDA 2,165 2,388 3,192 PBITDA Margin 21.0% 18.0% % PBIT 1,455 1,634 2,323 PBIT Margin 14.1% 12.3% 16.8% PAT 2 1,205 1,081 1,541 PAT Margin 11.7% 8.1% % Note: 1 Due to high global crude prices, overall recession in global economy and some losses in financial derivative transaction 2 PAT does not include adjustments for share in associate company 52

53 Realisation, volume and revenue 900,000 40,000 30,000 30% 675,000 14,677 17,127 17,377 30,000 24,000 18,000 21% 18% 23% 25% 20% 450, , , , ,585 20,000 10,000 12,000 6,000 10,212 13,110 13,599 15% 10% 5% - FY 2008 FY 2009 FY FY 2008 FY 2009 FY % Sales Quantity in MT (LHS) Average Realisation in INR/MT (RHS) Sales in INR m (LHS) PBITDA margin (%) (RHS) 53

54 Realisation by segment Segment Net Realizations (INR/MT) FY2008 FY2009 FY2010 CAGR ( ) Food 14,655 17,730 18, % Soft Drinks 15,873 18,107 20, % Beer 12,242 15,433 16, % Liquor 13,852 16,658 16, % Pharmaceuticals 16,505 19,117 19, % Toiletries 15,593 18,787 18, % Vials 25,643 29,404 29, % Household 20,077 21,445 22, % Total 14,677 17,127 17, % Realisation has further increased by approximately 6-7% w.e.f. 1 August

55 Consolidated Balance Sheet All values in INR million Particulars FY08 FY09 FY10 Net Fixed Assets 8,979 9,904 11,380 Investments 1,139 1,021 1,446 Net Working Capital 3,074 4, Total Assets 13,192 15,012 16,911 Shareholders equity 8,799 9,490 10,545 Secured Loans 2,896 4,180 5,495 Unsecured Loans 1, Deferred tax liabilities Total liabilities and equity 13,192 15,012 16,911 Long term debt/ equity Total debt/ equity (x) Operating in a capital intensive industry, the Company has been able to maintain a total debt/ equity ratio of 0.35x 55

56 Hindusthan National Glass & Industries Ltd. (HNG) THANK YOU For any queries/to obtain more info, please write at

57 Annexure

58 Management team Jagdish Prasad Kasera, Senior President Over 40 years of experience. Joined Company in Jan-98. Responsible for operations and M&A Worked with several prominent groups - Williamson Magor, Usha Martin, Aditya Birla and Ispat Fellow member of the Institute of Chartered Accountants of India and the Institute of Company Secretaries of India. Also a Qualified Cost Accountant. Ratan Lal Khandelia, President Over 34 years of experience. Joined Company in Mar-99 Currently looking after Bahadurgarh, Rishikesh and Neemrana Plant Worked with various companies, including MP Birla Group and Ferro Alloys Group. Qualified Chartered Accountant from the Institute of Chartered Accountants of India Vinay Saran, Senior Vice President - Marketing Over 22 years of experience in the field of consumer products and consumer durable marketing. Joined Company in 2007 Key member of the governing body of the Indian Institute of Packaging, Mumbai, All India Management Association, Kolkata, Management Association, National HRD Network and the Indian Institute of Packaging, Kolkata Laxmi Narayan Mandhana, Chief Financial Officer Qualif ied Chartered Accountant and Company Secretary Over 20 years of experience in in finance - comprising capital issues, mergers, acquisitions, banking, project activities, business evaluations and monitoring. Is associated with the Group f or about seven years Member of the Finance Committee of the Conf ederation of Indian Industry, Eastern Region Expert in corporate f inance, taxation and accounts 58

59 Management team Animesh Banerjee, Senior Vice President Over 23 years of experience in polymers, pharmaceuticals, chemicals, fine chemicals, petrochemicals, dyes and intermediates, paints and varnishes, food processing and FMCG Worked with companies like Shaw Wallace, IPCCL, Mafatlal Industries Ltd., TATA Kansai, Berger Paints Currently looking after Rishra, Nashik and Puducherry Plant Post graduate from IIT Kharagpur and MBA from IIM, Kolkata Amar Chand Jain, Vice President Tech Centre Over 47 years in all areas of Container Glass Production. He joined the Company in 1963 Currently is a leading member of the Group Technical Centre, responsible for Research, Development, Technological Absorption, Innovations, Acquisitions and New Projects He is a science graduate Ram Surat Prasad Gupta, Vice President Over 35 years of experience in various industries - electrical (lighting division Philips), mechanical (HNG & Ind.), electronics (Binatone Electronics), process industries (Sheela Foam) He studied engineering (mechanical) and did his post graduation in management Associated with Quality Certifications Chandra Singh. K Mehta, Plant Head Nashik He started his career with M/s Hindusthan Development Corporation Limited and worked with M/s Shakti Insulated Ltd before joining HNG He has served 21 years in the career 59

60 Management team Jalaj Kumar Malpani, Vice President - Commercial He handles corporate MIS, annual business plan and quarterly performance reviews Recipient of Jawahar Award for meritorious performance in the area of cost reduction and cost control Worked with SAIL for 15 years at Bokaro Steel Plant and CMO, Kolkata, and ICI India Ltd for one year. Worked closely with Mckinsey & Co in the area of inventory management and debt Kulur Satish Shetty, Plant Head, Puducherry Over 28 years of experience, with over 25 years in the field of glass manufacture. He joined the Company in 2006 He has worked with Bharat Electronics Ltd,Taloja,Maharashtra (a public sector company), Videocon Narmada Glass, Bharuch,Gujarat, and Hotline Glass Ltd, Gwalior, Madhya Pradesh Holds a bachelor degree in mechanical engineering from a regional engineering college, Surathkal, Karnataka Devdutta Hoare, Exports Head Over 19 years of experience in in marketing of industrial products in India and abroad. Joined Company in 2007 Previously worked with Dr. Beck & Co, Atul Limited and Gwalior Chemicals He is chemical engineering graduate from Jadavpur University, Kolkata Bimal Kumar Garodia, Vice President - Finance Over 20 years of industry experience. He joined the company in Apr-08 Previous experience includes Bajaj Eco-tech Limited, a wholly owned subsidiary of Bajaj Hindusthan Ltd He is qualified Chartered Accountant, Cost Accountant and a Company Secretary 60

61 Management team Bishnu Kumar Kedia, VP - Materials Joined Company in 2003 Previously worked with Khaitan (India) Limited, Agarwal Hardwares Limited and Magma Leasing Limited B. Com. (Hons.) from St. Xavier s College (Calcutta University) where he scored 49th rank in the University and received national scholarship. He is qualified Chartered Accountant Kuldeep Kumar Sharma, Plant Head Neemrana Over 31 years of experience in glass industry He is B.Sc., M.A. (Eng), M.Ed.. Took training at O.I. (USA) for glass operations and quality management systems, HACCP (hazard analysis & critical control points) Course from DNV, IMS (Integrated Management System) Shammo Roy Choudhury, AVP HR Has over 25 years of rich experience having worked in renowned multinationals Pfizer, Otis Elevator Co (I) Ltd & Flakt India Ltd and engineering company Shriram Bearings Ltd & Stone India Limited He is Commerce Graduate from St Xavier s with Post Graduate in Industrial Relations & Personnel Management from Xavier Institute of Social Service, Ranchi 61