DCM Shriram Ltd. Q2 & H1 FY19 - Results Presentatin Octber 29, 2018 1
Safe Harbur Certain statements in this dcument may be frward-lking statements. Such frward-lking statements are subject t certain risks and uncertainties like gvernment actins, lcal plitical r ecnmic develpments, technlgical risks, and many ther factrs that culd cause ur actual results t differ materially frm thse cntemplated by the relevant frward lking statements. DCM Shriram Ltd. will nt be in any way respnsible fr any actin taken based n such statements and undertakes n bligatin t publicly update these frward-lking statements t reflect subsequent events r circumstances. All figures are cnslidated unless therwise mentined 2
Table f Cntent Title Slide N. Q2 FY19 4-7 Key Highlights 4-5 Financial Snapsht 6 Segment Perfrmance 7 H1 FY19 8-9 Financial Snapsht 8 Segment Perfrmance 9 Q2 FY19 Perfrmance Overview & Outlk 10-13 Prjects under Implementatin 14 Management s Message 15 Segmental Details 16-31 Chlr-Vinyl Businesses 17-21 Sugar 22-24 Agri Input Businesses 25-28 Other Businesses 29-31 Abut Us & Investr Cntacts 32 3
Q2 FY 19 Key Highlights 1. Net Revenues up by 6% (Rs 1,700 crre vs Rs 1,605 crre fr same perid last year): a. Own Prducts Revenues increased by 7% YY. i. Chemicals Revenues up by 23% YY with increase in net realizatins by 16% and vlumes gain f 5%. ii. iii. Sugar Overall revenues lwer by 7% YY. Sugar revenue dwn by 23% with prices dwn by 14% and vlumes dwn by 9% due t sales restrictin by central gvernment. Distillery revenues mitigated partly the lwer Sugar revenues. Fenesta Revenues up by 16% YY led by retail segment. b. Traded Prducts Overall Revenues frm traded prducts declined by 1% YY. i. Revenues f bulk fertilizers and Haryali Kisaan Bazaar (Fuel Pumps) dwn by 31%, part f the plan t reduce these activities. ii. Revenues f value added agri-inputs imprved by 40%. 2. PBDIT std at Rs 313 crre vs Rs.306 crre ver same perid last year. The prfit fr current year is after charging sugar ff seasn expenses f Rs 31.6 crre fr Q2 FY19 (Rs 37.3 crre fr H1 FY19). Such expenses were being deferred fr interim results till last year. a. Chemicals PBDIT at Rs 198 crre up by 21% YY, with higher vlumes (up 5%) and higher realizatins. b. Plastics PBDIT dwn by 55% YY at Rs 16 crre due t higher input csts and lwer vlumes resulting frm shutdwn f 10 days. c. Sugar Overall PBDIT at Rs 98 crre up by 20% YY. Sugar PBDIT at Rs 44 cres declined by 46% YY even after inventry revaluatin gain f Rs 48 crre. Sugar prices at Rs 3,207/ Qtl fr Q2 FY19 dwn 14% vs last year. Distillery cntributed t the segment earnings, ff-setting lwer earnings frm sugar. 4
Q2 FY 19 Key Highlights 3. PAT std at Rs 169 crre vs Rs 172 crre fr same perid previus year. EPS fr the quarter std at Rs 10.56 vs Rs 10.59 in Q2 FY18. 4. Grss Debt as n September 30, 2018 std at Rs. 915 crre vs. Rs 673 crre as n September 30, 2017. Cash and Cash equivalents std at Rs. 456 crre vs Rs. 717 crre fr the same perid. 5. Cmmissined 168 TPD additinal Caustic Sda capacity at Kta and 10 TPD Aluminum Chlride at Bharuch. Will cntribute t the revenues and earnings in H2 FY19. 6. Prjects under implementatin at investment f ~ Rs. 1,150 crre ver next 4-5 quarters in Sugar and Chlr-Vinyl segments, t be cmmissined in phases. 7. Interim Dividend The Bard declared an interim dividend f 200% (LY: 200%) amunting t Rs 75.20 crre (including DDT). 8. Cmpany cmpleted the share buy-back prgram n 23 rd Octber, 2018. 64.74 lac shares, representing 3.99% f capital, were bught and extinguished at a ttal cst f Rs 249.999 crre plus incidentals. 5
Q2 FY19 Financial Snapsht Revenue (Net) PBDIT Depreciatin 1,605 1,700 306 313 36 38 Q2 FY18 Q2 FY19 Q2 FY18 Q2 FY19 Q2 FY18 Q2 FY19 Finance Cst PBIT PAT 41 20 270 276 172 169 Q2 FY18 Q2 FY19 Q2 FY18 Q2 FY19 Q2 FY18 Q2 FY19 Nte: All figures in Rs. crre Net revenue includes perating incme 6
Q2 FY19 - Segment Perfrmance Segments Q2 FY18 Q2 FY19 Rs. crre Revenues PBIT PBIT Margins % YY % Change Q2 FY18 Q2 FY19 YY % Change Q2 FY18 Q2 FY19 Chlr Vinyl 484.7 553.2 14.1 178.7 195.8 9.6 36.9 35.4 Sugar 516.5 478.9 (7.3) 74.1 87.4 18.0 14.3 18.2 - Sugar 516.5 397.4 (23.1) 74.0 35.6 (51.8) 14.3 9.0 - Pwer 0.0 7.5 27,380.4 0.1 4.1 7,712.7 192.2 54.6 - Distillery - 74.0-0.0 47.7 - - 64.4 SFS 151.7 156.9 3.4 6.8 1.3 (80.5) 4.5 0.8 - Bulk 61.1 30.2 (50.5) 2.4 (5.3) - 3.9 (17.5) - Value Added 90.6 126.7 39.8 4.4 6.6 50.6 4.8 5.2 Biseed 80.0 82.7 3.4 (2.2) (4.0) - (2.7) (4.8) Fertilizer 196.4 247.0 25.8 33.2 17.6 (47.2) 16.9 7.1 Others 188.7 191.5 1.5 11.3 12.7 12.7 6.0 6.7 -Fenesta 85.1 99.0 16.4 7.9 13.1 67.0 9.2 13.3 -Cement 44.6 40.3 (9.7) 3.4 (0.3) - 7.6 (0.6) -Hariyali Kisaan Bazaar & thers 59.0 52.2 (11.5) 0.1 (0.2) - 0.1 (0.3) Ttal 1618.0 1,710.3 5.7 301.9 310.8 3.0 18.7 18.2 Less: Intersegment Revenue 13.3 10.2 (22.9) Less: Unallcable expenditure (Net) 31.7 35.0 10.4 Ttal 1,604.7 1,700.1 5.9 270.2 275.9 2.1 16.8 16.2 Nte: Net revenue includes perating incme 7
H1 FY19 Financial Snapsht Revenue (Net) PBDIT Depreciatin 3,551 3,768 648 661 67 74 H1 FY18 H1 FY19 H1 FY18 H1 FY19 H1 FY18 H1 FY19 Finance Cst PBIT PAT 77 581 587 406 387 44 H1 FY18 H1 FY19 H1 FY18 H1 FY19 H1 FY18 H1 FY19 Nte: All figures in Rs. crre Net revenue includes perating incme 8
H1 FY19 - Segment Perfrmance Segments H1 FY18 H1 FY19 Rs. crre Revenues PBIT PBIT Margins % YY % Change H1 FY18 H1 FY19 YY % Change H1 FY18 H1 FY19 Chlr Vinyl 930.0 1,166.1 25.4 321.7 470.7 46.3 34.6 40.4 Sugar 1,142.2 1,097.0 (4.0) 182.2 84.6 (53.5) 16.0 7.7 - Sugar 1,116.5 926.1 (17.1) 168.1 (32.2) - 15.1 (3.5) - Pwer 25.7 60.5 135.1 14.1 46.5 230.6 54.6 76.8 - Distillery - 110.5 - - 70.3 - - 63.6 SFS 428.4 368.3 (14.0) 17.4 11.2 (36.0) - 3.0 - Bulk 146.8 84.9 (42.2) 4.1 (2.9) - 2.8 (3.5) - Value Added 281.6 283.5 0.7 13.4 14.1 5.5 4.7 5.0 Biseed 386.5 364.7 (5.6) 77.1 43.8 (43.3) 20.0 12.0 Fertilizer 364.3 474.7 30.3 34.3 26.2 (23.5) 9.4 5.5 Others 410.5 405.0 (1.4) 21.4 24.6 14.6 5.2 6.1 -Fenesta 162.3 191.5 18.0 13.5 24.0 77.7 8.3 12.5 -Cement 94.1 82.0 (12.9) 8.5 0.6 (92.8) 9.1 0.7 -Hariyali Kisaan Bazaar & thers 154.1 131.5 (14.7) (0.6) (0.1) - (0.4) (0.0) Ttal 3,661.8 3,875.8 5.8 654.2 661.0 1.0 17.9 17.1 Less: Intersegment Revenue 111.2 107.8 (3.1) Less: Unallcable expenditure (Net) 73.1 74.3 1.7 Ttal 3,550.7 3,768.0 6.1 581.1 586.7 1.0 16.4 15.6 Nte: Net revenue includes perating incme 9
Q2 FY19 - Perfrmance Overview & Outlk Net revenue higher by 14% YY, Earnings up 10%. Chemicals Caustic ECU prices increased by 16% YY. Vlumes increased by 5% YY fr Q2 FY19 and 9% YY fr H1 FY19. One f the plant had maintenance shut dwn during Q2 FY19. Operatins nrmalized nw. 168 TPD capacity at Kta cmmissined and will cntribute t vlume grwth in H2 FY19. Plastics Chlr-Vinyl Plastics revenue dwn by 7% YY due t lwer vlumes resulting frm a 10 day shut dwn. PVC prices up by 10% YY and carbide prices up by 20% YY during Q2 FY19. PBIT dwn by 60% YY impacted by lwer vlumes, higher input csts and shut dwn expenses. Outlk Prjects under implementatin 332 TPD capacity at Bharuch t cme n stream in phases by Q1 FY 20. 40 TPD PVC plant at Kta t cmmissin by Q3 FY20. Caustic ECU prices mved dwn in Q2 vis a vis Q1 FY19, but have seen an upward mvement since August 2018. PVC prices are stable. Rising input csts may put margins under pressure. 10
Q2 FY19 - Perfrmance Overview & Outlk Overall revenues lwer by 7% YY. Sugar revenues declined by 23% YY. The net realizatins were lwer by 14% & the vlumes lwer by 9% due t sales restrictin by gvernment. Mlasses prices dwn t almst zer. Sugar prices presently ~ Rs 3,250/ Qtl, significantly belw the Seasn 2018 cst f Rs 3,585/ Qtl. Hwever, realizatins imprved vs Q1 FY19 prices f Rs 2,773 per Qtl. Sugar clsing stck f 21.84 lac Qtl valued at an average f Rs 3,120 per Qtl leading t revaluatin gain f Rs 48 crre during Q2 FY19 (Rs 11 crre gain fr H1 FY19). Sugar Distillery perating at full capacity cntributed t the revenues during Q2 FY19. Prvided part mitigatin frm lwer sugar earnings and near zer mlasses prices during Q2 FY19. Outlk Q2 has seen sme revival in the prices vis a vis Q1 FY19 which saw prices ging dwn t near Rs 2,500 per Qtl. Present prices levels f ~Rs 3,250 per Qtl. Gvernment has annunced exprt f 5 Mn tnne f Sugar fr SY 2018-19. Cmpanies have started cntracting fr the same. Expansin f Sugar Capacity (5000 TCD) and C-gen (30 MW) - t be cmpleted by 3rd Quarter FY 19 200 KLD Distillery t be cmmissined by 3rd Quarter FY 20. 11
Q2 FY19 - Perfrmance Overview & Outlk Overall revenues up by 3% YY. Revenues frm bulk fertilizer dwn by 50% and revenues frm value added inputs up by 40% in line with the strategy t fcus n value added inputs and reduce activities under bulk prducts. Shriram Farm Slutins Earnings imprved due t higher vlumes and better margins f value added prducts. Earnings fr bulk fertilizer were ve due t csts relating t winding dwn the activities. Outlk Planning t further reduce the vlume f Bulk fertilizers ging frward. Enhanced fcus n value added prducts will lead t better grwth and prfits in medium term. Biseed revenues marginally up by 3% YY. Biseed Outlk Q2 is an ff-seasn fr this business in India. Net revenues frm India peratins were up 19% at Rs. 69 crre lead by Crn and Hybrid Paddy. Internatinal business revenue dwn by 38% at Rs 14 crre due t impact n crn sales in sme cuntries Expect grwth in this business ver medium term. Challenges in cttn seed business expected t cntinue. 12
Q2 FY19 - Perfrmance Overview & Outlk Revenues up 26% primarily due t higher prices (ie reflectin f higher energy cst, a pass thrugh). Plant had a stppage fr 9 days during the quarter. Stabilized nw. Fertilizers (Urea) Subsidy utstanding as n 30 th September, 2018 std at Rs 360 crre vs Rs 283 crre as n 30 st September 2017 leading t higher capital emplyed. Outlk Gvernment has referred the matter f energy nrms wef 1st April, 2020 and the issue f increase in cnversin csts t Niti Aayg. Expect prgress in the matter. Others Q2 FY19 net revenues at Rs 99 crre increased by 16% YY and 7% QQ. Fenesta Windws H1 FY19 saw an increase f 18% YY in the revenues. Retail segments led the grwth during the quarter and half year. Overall rder bking up by 16% YY. Cement Hariyali Kisaan Bazaar Net revenue lwer by 10% YY in Q2 FY19. Earnings declined due t increase in the csts during the quarter. The activities under Hariyali Kisaan Bazaar includes fuel sales nly. Plan t clse this activity. N f fuel utlets have been reduced frm 32 in Sep 2017 t 23 presently. 13
Prjects Under Implementatin Prjects Under Implementatin Business Prject Capacity Prject Cmpletin Timeline Cane Crushing Expansin 5000 TCD Q3 FY19 Sugar Distillery 200 KLD Q3 FY20 Pwer C-Gen 30 MW Q3 FY19 Caustic Sda Expansin 332 TPD Chemicals -Bharuch 186 TPD -Bharuch 146 TPD Q1 FY20 Aluminum Chlride Plant* 60 TPD Q3 FY19 Plastics PVC expansin at Kta 40 TPD Q3 FY20 Captive Pwer Plant at Kta *Cmmissined 10 TPD Replacement f existing 50 MW Cal based Pwer Plant 66 MW Q3 FY20 14
Management s Message Cmmenting n the perfrmance fr the quarter and financial year, in a jint statement, Mr. Ajay Shriram, Chairman & Senir Managing Directr, and Mr. Vikram Shriram, Vice Chairman & Managing Directr, said: We are happy with satisfactry perfrmance f the cmpany during the quarter. We have prgressed well n all ur grwth and prfit imprvement plans. The ratinalizatin f bulk fertilizers and Hariyali business is als mving satisfactrily. The prduct prices in almst all ur businesses are imprving. The expansin prjects in Chemicals, PVC, Sugar (including C- Gen Pwer and Distillery) and chlrine based chemicals have started cming n stream frm Sep/Oct 18. These steps will prvide vlume grwth as well as better margins. Sugar business has recrded psitive develpments with several steps taken by central and UP gvernment. We believe that nce implemented, these steps will strengthen the business ver the medium term. Fenesta cntinues t grw in retail and prject segments even in tugh business envirnment. Biseed and Farm Slutins are expected t grw ver medium term. We will cntinue t take up prjects fr cntinuus grwth & margins imprvement while maintaining a healthy balance sheet. 15
Segmental Details Chemicals Chlr-Vinyl Businesses PVC Resins Calcium carbide Pwer Agri- Inputs Shriram Farm Slutins Biseeds Fertilizers Agri Businesses Sugar Fenesta Building Systems Other Businesses Cement Plymer Cmpunds Hariyali Kisaan Bazaar 16
Chlr Vinyl Business Particulars Revenues (Rs. Cr.) PBIT (Rs. Cr.) Cap. Emplyed (Rs. Cr.) Q2 FY19 553.2 195.8 1,194.1 Q2 FY18 484.7 178.7 1,038.7 % Shift 14.1 9.6 15.0 H1 FY19 1,166.1 470.7 1,194.1 H1 FY18 930.0 321.7 1,038.7 % Shift 25.4 46.3 15.0 The Chlr-Vinyl business f the Cmpany has highly integrated peratins with multiple revenue streams and 209 MW captive pwer generatin facilities. Chemicals peratins are at tw lcatins (Kta Rajasthan and Bharuch Gujarat), while Vinyl is at Kta nly. The multiple revenue streams enable the Cmpany t ptimize peratins in a manner t maximize the cntributin per unit f pwer. 17
Prices - $ Prices - Rs Chemicals Particulars Sales (MT) Operatinal Realisatins (Rs./MT) Revenues (Rs Cr.) Financial PBIT (Rs. Cr.) Q2 FY19 108,362 33,330 416.9 182.9 Q2 FY18 103,445 28,751 338.3 146.7 % Shift 4.8 15.9 23.2 24.7 H1 FY19 220,801 34,565 885.9 431.0 H1 FY18 202,836 27,212 633.1 256.6 % Shift 8.9 27.0 39.9 67.9 790 740 690 640 590 540 490 440 390 Imprt Caustic and DCM ECU Prices 758 38,675 37,747 37,895 35,724 35,901 595 658 31,160 573 540 33,289 29,124 570 488 28,904 505 462 22,900 405 April May June July August Sep Oct Nv Dec Jan Feb March 45,000 40,000 35,000 30,000 25,000 20,000 Caustic Sda Prices (CFR-SEA Prices $/MT) - FY18 DCM Realizatins ECU - Rs/ MT - FY18 Caustic Sda Prices (CFR-SEA Prices $/MT) - FY19 DCM Realizatins ECU - Rs/ MT - FY19 18
Chemicals Perfrmance Overview Q2 FY19 revenue increased by 23% YY with vlume grwth f 5% and increase in net realizatins by 16%. Revenue declined by 11% QQ with realizatins dwn by 7%. One f the plant had a maintenance shut dwn during Q2 FY19. Operatins nrmalized nw. 168 TPD capacity at Kta cmmissined, t cntribute t revenues in FY19. PBIT up by 25% YY at Rs 183 crre. Outlk Prjects under implementatin f 332 TPD capacity at Bharuch t cme n stream in phases by Q1 FY 20. Caustic ECU prices mved dwn in Q2 vis a vis Q1 FY19, but have seen an upward mvement since August 2018. 19
Plastics Operatinal Financial Particulars PVC Sales (MT) PVC XWR Realisatins (Rs./MT) Carbide Sales (MT) Carbide XWR Realisatins (Rs./MT) Revenues (Rs Cr.) PBIT (Rs. Cr.) Q2 FY19 12,795 76,692 6,712 52,443 136.3 13.0 Q2 FY18 15,744 70,035 8,032 43,783 146.4 32.0 % Shift (18.7) 9.5 (16.4) 19.8 (6.9) (59.5) H1 FY19 27,974 76,167 11,708 51,783 280.2 39.7 H1 FY18 31,627 70,240 14,805 43,724 296.8 65.1 % Shift (11.5) 8.4 (20.9) 18.4 (5.6) (39.0) 20
Prices - $ Prices - Rs Plastics Imprt and DCM PVC Prices 1,010 79,000 1,000 990 980 970 960 950 940 930 1,000 73,918 75,967 956 78,077 961 76,534 972 985 76,788 77,943 953 78,000 77,000 76,000 75,000 74,000 920 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 73,000 PVC Prices (CFR-India $/MT) DCM Realizatins PVC - Rs / MT Revenue lwer by 7% YY due t lwer vlumes resulting frm 10 days shut dwn. Perfrmance Overview PVC and Carbide prices up 10% and 20% respectively. PVC vlumes dwn 19%. Carbide vlumes lwer 16% PBIT dwn due t lwer vlumes, higher input csts and shut dwn expenses. Outlk 40 TPD PVC plant at Kta t cmmissin by Q3 FY20. PVC prices are stable. Rising input csts may put margins under pressure. 21
Sugar Particulars Q2 FY18 Q2 FY19 YY % Change H1 FY18 H1 FY19 YY % Change Revenues (Rs. cr.) Sugar 516.5 397.4 (23.1) 1,116.5 926.1 (17.1) Pwer 0.0 7.5 27380.4 25.7 60.5 135.1 Distillery - 74.0 - - 110.5 - Ttal 516.5 478.9 (7.3) 1,142.2 1,097.0 (4.0) PBIT (Rs cr.) Sugar 74.0 35.6 (51.8) 168.1 (32.2) - Pwer 0.1 4.1 7712.7 14.1 46.5 230.6 Distillery - 47.7 - - 70.3 - Ttal 74.1 87.4 18.0 182.2 84.6 (53.5) Cmpany perates its sugar business at fur lcatins in state f UP viz Ajbapur, Lni, Hariawan and Rupapur. Ttal perating crushing capacity is 33,000 TCD with anther 5,000 TCD expansin under implementatin. Sugar business is supprted by 111 MW c-gen pwer plant with anther 30 MW under implementatin. Distillery with capacity 150 KLD cmmissined in Jan 18. Secnd Distillery f 200 KLD t be cmmissined by Q3 FY20. 22
Sugar Particulars Sugar (Lac Qtls) Sales (Vlume) Pwer (Lac Units) Distillery (Lac Ltrs) Sugar Realizatins (Rs/ Qtl) Cap. Emplyed (Rs Cr.) Q2 FY19 12.0 145.5 180.2 3207 1054.1 Q2 FY18 13.2 1.0-3724 476.9 % Shift (8.7) 14,450.4 - (13.9) 121.0 H1 FY19 30.0 1,162.9 267.3 2,947 1054.1 H1 FY18 28.9 501.6-3,675 476.9 % Shift 3.6 131.8 - (19.8) 121.0 3,900 DCM Sugar Realizatins (Rs/ Qtl) 3,700 3,500 3,300 3,100 2,900 2,700 3,623 3,663 3,617 2,859 3,027 2,639 3,690 3,726 3,744 3,766 3,307 3,252 3,107 3,643 3,407 FY19 3,248 3,144 FY18 3,132 2,500 April May June July August September Octber Nvember December January February March 23
Sugar Segment Overall revenues dwn by 7% YY in Q2 FY19. Sugar revenues declined by 23% YY. Sugar vlume declined by 9% due t sales restrictin by central gvernment. Sugar realizatins dwn by 14%. Realizatins f mlasses remained under pressure during the quarter. Perfrmance Overview Overall earnings up by 18%. Sugar earnings declined by 52% as sugar prices remained at Rs 3,207 per Qtl during the quarter, belw the Seasn 2018 cst f Rs 3,585/ Qtl. PBIT f Rs 48 crre frm Distillery, partly mitigated lwer earnings frm sugar. Inventry valued at Rs 3,120 per Qtl leading t a revaluatin gain f Rs 48 crre fr Q2 FY19 (H1 FY19 gain f Rs 11 crre). Sugar Clsing stck std at 21.84 lac qtls as n 30 th September, 2018 vs 3.93 lac qtls as n 30 th September, 2017. Q2 has seen sme revival in the prices vis a vis Q1 FY19 which saw prices ging dwn t near Rs 2,500 per Qtl. Present prices levels f ~Rs 3,250 per Qtl. Outlk Gvernment has annunced exprt f 5 Mn tnne f Sugar fr SY 2018-19. Cmpanies have started cntracting fr the same. Fresh capacity expansin prceeding as per schedule: Sugar Capacity (5000 TCD) - t be cmpleted by 3rd Quarter FY 19 C-gen (30 MW) - t be cmpleted by 3rd Quarter FY 19 200 KLD Distillery t be cmmissined in 3 rd Quarter FY 20. 24
Agri- Input Businesses The Agri input businesses cntributed t 29% f the Cmpany s revenues during Q2 FY19. The Cmpany cntinues t fcus n these businesses given the huge pprtunity in this area where the Cmpany can capitalize n its lng understanding f varied Agri businesses and the rural cnsumer; its established infrastructure; services & prduct prtfli; and a deep rural presence. The Agri Input Business includes: Shriram Farm Slutins Biseed Fertilizer (Urea) 25
Shriram Farm Slutins Particulars Revenues (Rs. Cr.) PBIT (Rs. Cr.) Cap. Emplyed Bulk Value Added Ttal Bulk Value Added Ttal (Rs. Cr.) Q2 FY19 30.2 126.7 156.9 (5.3) 6.6 1.3 274.4 Q2 FY18 61.1 90.6 151.7 2.4 4.4 6.8 347.5 % Shift (50.5) 39.8 3.4-50.6 (80.5) (21.1) H1 FY19 84.9 283.5 368.3 (2.9) 14.1 11.2 274.4 H1 FY18 146.8 281.6 428.4 4.1 13.4 17.4 347.5 % Shift (42.2) 0.7 (14.0) - 5.5 (36.0) (21.1) The prtfli cmprises Value-added prducts such as Seeds, Pesticides, Sluble Fertilizer, Micr-nutrients etc. alng with Bulk Fertilizers (SSP). This business is seasnal in nature and the results in the quarter are nt representative f annual perfrmance Perfrmance Overview Ttal revenues fr Q2 FY19 up by 3% YY led by psitive grwth frm value added inputs (revenues up by 40%). Revenues frm Bulk fertilizers dwn by 50% (part f planned initiative). Ttal earnings dwn fr Q2 FY19. Lsses in bulk segment due t csts relating t winding dwn the activities. Earnings frm value added inputs supprted the verall earnings. Cntributin f value added business in revenue increased t 81% in Q2 FY19 frm 60% in Q2 FY18. Outlk Planning t further reduce the vlume f Bulk fertilizers ging frward. Enhanced fcus n value added prducts will lead t better grwth and prfits in medium term. 26
Biseed Particulars Revenues (Rs. Cr.) India Internatinal Ttal PBIT (Rs. Cr.) Cap. Emplyed (Rs. Cr.) Q2 FY19 69.1 13.7 82.7 (4.0) 468.3 Q2 FY18 57.9 22.1 80.0 (2.2) 491.0 % Shift 19.3 (38.1) 3.4 - (4.6) H1 FY19 320.4 44.3 364.7 43.8 468.3 H1 FY18 332.0 54.5 386.5 77.1 491.0 % Shift (3.5) (18.7) (5.6) (43.3) (4.6) Biseed business is intensely research based and is diversified acrss key crps (Cttn, Crn, Paddy, Bajra and Vegetables). India is the key market with presence acrss all abve crps. Internatinal presence is in Vietnam, Philippines and Indnesia wherein the key crp is Crn. The perfrmance f the business has seasnality, with Kharif being the majr seasn in India. Overall revenues up by 3% YY, Perfrmance Overview Outlk Q2 is an ff-seasn fr this business in India. Net revenues frm India peratins were up 19% YY at Rs. 69 crre lead by Crn and Hybrid Paddy. Internatinal business revenue dwn by 38% YY at Rs 14 crre due t impact n crn sales in sme cuntries Expect grwth in this business ver medium term. Challenges in cttn seed business expected t cntinue. 27
Fertilizers (Urea) Operatinal Financial Particulars Sales (MT) Realisatins (Rs./MT) Revenues (Rs. Cr.) PBIT (Rs. Cr.) Cap. Emplyed (Rs. Cr.) Q2 FY19 94,363 23,107 247.0 17.6 435.7 Q2 FY18 106,340 18,137 196.4 33.2 340.9 % Shift (11.3) 27.4 25.8 (47.2) 27.8 H1 FY19 185,820 23,472 474.7 26.2 435.7 H1 FY18 195,113 18,309 364.3 34.3 340.9 % Shift (4.8) 28.2 30.3 (23.5) 27.8 Perfrmance Overview Revenue fr Q2 FY19 increased by 26% YY led by imprved realizatins, which is reflectin f higher energy csts (a pass thrugh). Subsidy utstanding as n 30 th September, 2018 std at Rs 360 crre vs Rs 283 crre as n 30 st September 2017 leading t higher capital emplyed. Plant had a stppage fr 9 days during the quarter. Stabilized nw. Outlk Gvernment has referred the matter f energy nrms w.e.f 1st April, 2020 and the issue f increase in cnversin csts t Niti Aayg. Expect prgress in the matter. 28
Other Businesses The Others Segment in the financial results, includes Cement, Fenesta Building Systems and Hariyali Kisaan Bazar. Revenues under Others std at Rs 192 crre in Q2 FY19 frm Rs. 189 crre in Q2 FY18. PBIT fr the quarter std at Rs. 13 crre vis-à-vis Rs. 11 crre in Q2 FY18.. 29
Fenesta Building Systems Particulars Operatinal Order Bk (Rs Cr.) Retail Prjects Ttal Fenesta a pan India brand has becme synnymus with UPVC windws. Includes Retail and Prject Segment Financial Revenues (Rs Cr.) Q2 FY19 80.6 28.2 108.8 99.0 Q2 FY18 61.8 32.1 94.0 85.1 % Shift 30.3 (12.3) 15.8 16.4 H1 FY19 151.1 62.4 213.5 191.5 H1 FY18 123.9 46.6 170.4 162.3 % Shift 22.0 33.9 25.2 18.0 Q2 FY19 net revenues at Rs 99 crre increased by 16% YY and 7% QQ, led by retail segment. Perfrmance Overview Earnings up by 67% YY H1 FY19 saw an increase f 18% YY in the revenues and earnings up by 78%. Overall rder bking up by 16%. Emphasis n Retail segment t drive sustainable grwth thrugh higher sales acrss wide prduct prtfli by prviding exceptinal custmer experience. Outlk Prjects business t benefit frm key relatinships. Imprvement in the verall ecnmic scenari and uptick in the real estate sectr will enable higher penetratin f the upvc windw fferings. 30
Cement Operatinal Financial Particulars Sales (MT) Realizatins (Rs./MT) Revenues (Rs. Cr.) PBIT (Rs. Cr.) Q2 FY19 103,672 3,063 40.3 (0.3) Q2 FY18 111,407 3,008 44.6 3.4 % Shift (6.9) 1.8 (9.7) - H1 FY19 216,148 2,994 82.0 0.6 H1 FY18 238,555 3,131 94.1 8.5 % Shift (9.4) (4.4) (12.9) (92.8) The Cement business is small. since its capacity is driven by the waste generated frm carbide plant. The Cmpany markets its cement under the Shriram brand Perfrmance Overview Net revenue lwer by 10% YY during the quarter due t lwer vlumes. Earnings declined due t increased csts. Outlk Higher spending n infrastructure creatin (radways and urban infra) t drive grwth in demand. Business cmmitted t enhancing efficiencies further and ptimizing csts. 31
Abut Us & Investr Cntacts DCM Shriram Ltd. is an integrated business entity, with extensive and grwing presence acrss the entire Agri value chain and Chlr-Vinyl industry. The Cmpany has added innvative value- added businesses in these dmains primarily Biseed and Fenesta. Access t captive pwer at all key manufacturing units enables the businesses t ptimise cmpetitive edge. Fr mre infrmatin n the Cmpany, its prducts and services please lg n t www.dcmshriram.cm r cntact: Vinay Bhutra Siddharth Rangnekar / Shikha Kshirsagar DCM Shriram Ltd. CDR India Tel: +91 11 4210 0320 Tel: +91 22 6645 1209/43 Fax: +91 11 2372 0325 Fax: 91 22 6645 1213 Email: vinaybhutra@dcmshriram.cm Email: siddharth@cdr-india.cm / shikha@cdr-india.cm 32