Elpro International Limited Investor Presentation June 2015 1
Disclaimer This presentation and the accompanying slides (the Presentation ), which have been prepared by Elpro International 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. This presentation contains certain forward looking statements concerning the Company s future business prospects and business profitability, which are subject to a number of risks and uncertainties and the actual results could materially differ from those in such forward looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, competition (both domestic and international), economic growth in India and abroad, ability to attract and retain highly skilled professionals, time and cost over runs on contracts, our ability to manage our international operations, government policies and actions regulations, interest and other fiscal costs generally prevailing in the economy. The company does not undertake to make any announcement in case any of these forward looking statements become materially incorrect in future or update any forward looking statements made from time to time by or on behalf of the company. 2
About Elpro 01 Insurance 02 Real Estates PNB Metlife 12.7% Equity Shareholding in PNB MetLife Life Insurance Real Estates 35 acres - Pimpri -Chinchwad Land near Pune 03 Surge Arresters Surge Arresters Manufactures Metal Oxide Surge Arresters with technology from GE, USA 3
Business Overview Investment in PNB MetLife, a leading Life Insurance Company Equity Shareholding 12.7% MetLife, Inc., is one of the world's leading life insurance providers Total Plot Area : 146,181 Sq. Mts Completed: 12,384 Sq. Mts Partly Completed: 48,707 Sq. Mts Industrial Plot: 27,500 Sq. Mts Open Land o To Lease : 9,522 Sq. Mts o To Develop : 48,068 Sq. Mts India's largest and among the leading companies in South Asia in the design, manufacture and supply of distribution, intermediate and station class Metal Oxide Surge Arresters Technology from GE, USA 4
Management Team Mr Ram Swarup Dabriwala Chairman & MD He holds a Bachelor of Commerce from St. Xaviers College, University of Kolkata amongst the oldest and respected educational institutions in the country. He is Director of Trump Properties Ltd. (now renamed to Elpro Estates) and has over 35 years of experience in various industries like realty, steel, detergents and manufacturing of pre-stressed cement products in senior management positions. Mr Sambhaw Jain Chief Financial Officer Chartered Accountant and has more than 12 years experience in industries like Plywood, Timber, Electrical Equipments and Real Estate. He is representing the group companies for more than 5 years Madhav Srinivasan - Director He is a Mechanical Engineer with a PGDBM and an Inter ICWA. With over 40 years experience in Operations, Materials, Planning and Strategy, he has worked with Vehicle Factory Jabalpur, Bajaj Tempo, Eaton Hydraulics, Corona Bus Manufacturing Vicky Gandhi Technical Head (Retail Real Estate) He is a BE with over 9 years of experience in hotels and malls construction & operation with Indian Hotels (TATA Group), Virtuous. Deepak Kumar CEO, Mall Business A Management graduate with over 15 years experience in retail and retail real with ITC, Reliance, Future group & Virtuous Retail where he was. Nishant Kansal Manager Marketing & Leasing Is an MBA in Marketing and is responsible for branding and marketing for the retail real estate platform. His experiance spans across with Virtuous Retail and Future group. Dipankar Ghosh An Electrical Engineer he has over 22 years experience in the field of Profit centre, Operations & Project management with KEC RPG, Sterlite Industries & MP Birla Group of Industries Vikas Katigar GM Projects A Civil Engineer with more than 36 years of experience with Force Motors, Sterlite Industries, East India Hotels, Ruby Hall Clinic, Vekateshwara Hatcheries group & Panora Infrastructure. 5
01 Insurance 6
PNB MetLife MetLife, Inc., through its subsidiaries and affiliates ( MetLife ), is one of the largest life insurance companies in the world, serving ~ 100 mn customers PNB, being one of the largest nationalized banks, has continued to provide prudent and trustworthy banking services to its customers. MetLife Inc Is the largest life insurer in the US, a Fortune 50 Company and is the most admired life insurance company in Fortune 500 for 2014 MetLife has operates in nearly 50 countries and holds leading market positions in the US, Japan, Latin America, Asia, Europe and the Middle East PNB Over 120 years of strong existence and 6081 total branches including 5 foreign branches as on Mar 14, Punjab National Bank is serving more than 8.9 crore esteemed customers Overseas presence in 10 countries by way of 5 branches, 3 Subsidiaries, a JV at Nepal and 5 Representative Offices Holds 26% in PNB MetlLife Holds 30% in PNB MetLife PNB MetLife India PNB MetLife India Insurance Company Limited (PNB MetLife) is a joint venture between MetLife International Holdings Inc., Punjab National Bank Limited, Jammu & Kashmir Bank Limited (JKB), M. Pallonji and Company Private Limited, Elpro International, IGE and other private investors MetLife International Holdings Inc and Punjab National Bank Limited are the Majority Shareholders 7
MetLife International India Strategy MetLife Enterprise and Asia Strategy 1H14 Sales : $1416 MN Asia The industry s most attractive growth opportunity India Strategy: Leverage Punjab National Bank Transform agency Optimize geographical footprint Rest of Asia 96% India 4% To Build Value Growth Platform India & China CAGR 17% Insurance Laws (amendment) Bill 2015 introduced in March 2015 raises FDI investments limit to 49% of Equity Capital $35 mn $56 mn 1H11 1H14 * Latest available data 8
PNB MetLife Improving Operating Performance Statutory Profit Statutory Premiums Rs Crores 192 Rs Crores 2,677 153 2,508 108 2,430 2,461 85 2,241 32 FY11 FY12 FY13 FY14 FY15 FY11 FY12 FY13 FY14 FY15 Source: PNB MetLife Annual Report 9
PNB MetLife Strong Balance Sheet Shareholders Funds Solvency Ratio Rs Crores 2,116 228% 219% 2,064 207% 2,015 1,993 1,970 169% 165% FY11 FY12 FY13 FY14 FY15 FY11 FY12 FY13 FY14 FY15 Source: PNB MetLife Annual Report 10
Valuation Benchmarks FY2013 Punjab National Bank inducted as a shareholder with 30% equity holding J&K Bank, M Pallonji & Goldman Sachs Duo and other private investors reduced their holding J&K Bank raised Rs 190 Crores for reducing its stake from 11.18% to 5.08% FY2016 Insurance Laws (amendment) Bill 2015 introduced in March 2015 raises FDI investments limit to 49% of Equity Capital Source: News Articles and Company Reports J&K Bank has started a process to sell 5% remaining stake in PNB Metlife 11
02 Real Estate 12
Real Estates Owns 35 acres of Land in Pimpri Chinchwad area of Pune, Maharashtra One of the most prominent industrial destinations near Pune Increasing demand for residential real estate project to cater to demand of increasing workforce Project includes Commercial spaces office buildings Residential Spaces School Factory Space Elpro Mall: Elpro Estates Ltd: 86.21% Joint Venture 13
Key Projects Web Community International School Metropolitan By Elpro Elpro Mall Factory Elpro Hub * Artist s impression of projects 14
Real Estate Details Usage Plot Area in Sq Mts Revenue Style (Sales/lease) % Complete Residential (Metropolitan) 24,207 Sales 81% Residential 2,500 Sales 100% Mall 24,500 Sale & Lease 30% Commercial 2,768 Sale 100% Office Building 7,116 Lease 71% School 9,522 Lease Open Land Factory 27,500 Let out 33 % Open Land 48,068 Projects in Pipeline Net Total 1,46,181 Total Land Bank of 35 acres in Pimpri - Chinchwad area of Pune, Maharashtra 15
Leasing Business Leasing Revenue Plot Area in Sq Mts FY15 Revenue Rs Lacs Factory Leasing 8,630 150 Office Leasing 6,841 432 School + Play Ground Leasing 13,080 305 Leasing Stock Mall 10,985 To Commence in FY16 Office 4,028 To Commence in FY16 Factory 6,438 To Commence in FY16 16
Metropolitan by Elpro Construction Tracker March 2015 81% completed Possession to be given by May 2016 Pending construction of 1,65,545 sq ft (90% civil work of this is over) This exclusive living space has been formed with careful thought given to incorporating maximum daylight penetration and the flow of cool natural breeze into every apartment. Metropolitan is a high-end residential project offering the highest standards of quality, comfort, refinement and safety Sales Tracker 3,38,001 sq ft sold for a value of Rs. 1,202 mn Unsold area of 1,39,937 sq ft Received Rs. 1,185 mn Revenue recognized Rs. 1,135 mn Proposed project closure by May 2016 17
Elpro Mall Construction Tracker March 2015 30% completed Possession to be given by June 16 Pending construction of 2,40,000 sq ft Sales Tracker 1,50,000 sq ft sold for a value of Rs.540 mn Leasable area 3,02,277 Sq ft ( Other than area already sold) Received Rs. 378 mn Proposed project closure by June 2016 18
Elpro Metropolis Glimpse of Projects Elpro Business Bay Metropolitan By Elpro Global Indian International School Elpro Business Bay
03 Surge Arresters 20
Surge Arresters India's largest and among the leading companies in South Asia in Surge Arresters with technology from GE, USA Specialise in Design, Manufacture and Supply of Metal Oxide Surge Arresters known as Gapless Provide technical advantages and significant cost savings Protection against overvoltage caused by lightning/switching surges Arrester consists of a stack of metal oxide discs housed in a sealed porcelain housing. On the end faces of each disc, a conducting surface is applied to assure proper contact and uniform current distribution Types of Zinc Oxide Surge Arresters Marquee Customers Distribution Class Station Class 21
Product Portfolio Distribution Class Arresters Station Class Arrestors Utilised in distribution network Range: 3 kv - 36 kv Secondary Surge Arresters MOGARD station class Surge Arresters Range: 3 kv - 36 kv Under Oil Surge Arresters Protection against externally induced surges and internally generated switching surges Predominantly used by OEMs Protection of transformer windings 22
Financial Performance 23
Standalone Performance Rs. Crs Q4FY15 Q4FY14 YoY% FY15 FY14 YoY% Revenue 9.2 8.1 13.8% 36.7 28.5 28.7% Raw Material 3.4 3.3 14.5 11.6 Employee Cost 0.6 0.6 1.9 1.5 Other Expenses 1.1 2.8 4.3 4.8 EBITDA 4.17 1.4 204.3% 16.0 10.6 50.5% EBITDA Margin 45.2% 16.9% 43.6% 37.3% Other Income 0.2 0.3 0.4 0.5 Interest 4.6 3.7 17.9 13.6 Depreciation 0.1 0.3 0.5 1.4 Exceptional Item 0.0-0.1-0.0-0.1 PBT -0.33-2.4-2.0-4.0 Tax 0.0 0.0 0.0 0.0 PAT -0.33-2.4-2.0-4.0 24
Consolidated Profit and Loss Statement Rs. Crs FY15 FY14 YoY % Revenue 36.7 28.5 28.7% Raw Material 14.5 11.6 Employee Cost 2.0 1.7 Other Expenses 4.4 4.9 EBITDA 15.7 10.3 28.7% EBITDA Margin 42.90% 36.25% Other Income 0.4 0.5 Interest 17.9 13.6 Depreciation 0.5 1.4 Exceptional Item 0.0-0.1 PBT -2.4-4.3 Tax 0.1 0.01 PAT -2.3-4.3 Share of (loss)/profit of minority 0.01 0.01 Share of profit of associate 0.04 0.05 PAT after Minority Interest and Share of Associate Profit -2.3-4.4 25
Consolidated Balance Sheet Rs. Crores Mar-15 Mar-14 Shareholder s Fund 175.6 178.0 Share capital 8.6 8.6 Reserves & Surplus 166.9 169.4 Minority Interest 4.2 4.2 Non-Current Liabilities 55.2 48.1 Long term borrowings 22.6 25.7 Other Non Current Liabilities 32.6 22.4 Current Liabilities 171.3 160.4 Short Term Borrowings 99.4 80.7 Trade Payables 6.1 4.7 Other current liabilities 65.9 75.1 Total Liabilities 406.3 390.8 Rs. Crores Mar-15 Mar-14 Non-Current Assets 369.8 356.8 Fixed assets 93.6 81.3 Goodwill 0.7 0.7 Non-Current Investments 269.2 269.2 Other Non-Current Assets 6.3 5.6 Current Assets 36.5 34.0 Inventories 27.4 28.1 Trade receivables 5.9 2.9 Cash and Bank Balances 0.3 1.1 Other current assets 2.9 2.0 Total Assets 406.3 390.8 26
For further information, please contact: Company : Investor Relations Advisors : Elpro International Ltd. CIN: L51505MH1962PLC012425 Mr. Sambhaw Jain sambhaw@elpro.co.in www.elpro.co.in Strategic Growth Advisors Pvt. Ltd. CIN: U74140MH2010PTC204285 Ms. Payal Dave / Ms. Ruchi Rudra dpayal@sgapl.net / rruchi@sgapl.net www.sgapl.net 27