Corporate Overview - MOL

Transcription

1 Meghmani Organics Limited 1H and 2Q FY08 Results

2 Corporate Overview - MOL Established in 1986, MOL is amongst the leading pigments and agrochemicals manufacturers in India Capitalizing on the global outsourcing trend

3 Corporate Focus PIGMENTS & AGROCHEMICALS Specializes in the manufacture of green & blue pigment products and a broad spectrum of commonly used generic pesticides Business p g Focus Industry Focus PIGMENTS: Multiple applications in printing inks, plastics, paints, textiles, leather, paper & rubber AGROCHEMICALS: Crop protection and non-crop applications like Public health, termite & insect control, veterinary applications Market Focus GLOBAL FOCUS with markets in the US, Europe, Latin America & Asia Pacific

4 The Art of Manufacturing 4 multi location plants in Gujarat, Western Part of India Total floor area of 180,000 sq mts ISO certified Panoli Plant Pigments Ankleshwar Plant Agrochemicals Vatva Plant Chharodi Plant

5 Strategic Location Meghmani Group s plants are located in the state of Gujarat famous for its natural locational advantage Pigments Dyestuffs Additives Agro Chemicals Vatva Plant/s Panoli Plant Chharodi Plant/s Ankleshwar Plant New site near port - Dahej Located in India s prime chemical belt Close proximity to sources of raw materials at low cost Proximity to key ports, railway and road network Large pool of scientists and engineers

6 Meghmani s Global Network Extensive network of 20 overseas distributors: ib Branch offices in the US, Europe, Turkey and China Warehouses in Germany, Belgium, Turkey, Russia, USA, Uruguay and China Over 1,000 stockists, agents, distributors and dealers covering Indian market Over 350 customers worldwide incl. MNC s and OEM s 75% revenue from Exports market

7 Corporate Strategy Two Strategic Business Units MEGHAFAST SBU Pigments & Additives SBU Agrochemicals MEGASTAR MEGACYPER Applications Applications Paints & Coatings, Inks, Plastics, Textiles, Leather, Rubber, etc. Crop protection Non-crop applications like Public health, Control of insects in household applications Veterinary applications

8 1H & 2Q (2008) Results Analysis

9 Key Highlights of 2Q2008 Sales Gross profit Net profit of Rs1.7 billion, +25.2% 2% of Rs329.4 million, +6.0% of Rs93.0 million, -12.7% EPS of Rs77 cents Record Achievements for 2 consecutive quarters Record Achievements for 2 consecutive quarters Exceeding Rs1 billion in Revenue

10 Financial Highlights 3 months ended 30 Sep 6 months ended 30 Sep In Rs millions % Chg % Chg Revenue 1, , , , Gross Profit Profit from ops (0.2) Profit before tax (PBT) Income tax (24.5) (2.8) (46.6) (20.5) Profit after tax (PAT) (12.7) (10.2) Gross margin (%) (1.3) PBT margin (%) (1.4) (1.2) PAT margin (%) (2.5) (2.1) EPS (Rs) (0.16) (0.21) Earnings per SDSs (Rs) (0.08) (0.20) For conversion to SGD, please use an average exchange rate of S$1: Rs for Sept 2007

11 Balance Sheet Highlights In Rs million 1H 08 1H 07 FY 07 (30 Sep 07) (30 Sep 06) (31 Mar 07) Trade receivables 2, , ,850.8 Inventories Cash & bank balances Shareholders equity 3, , NTA per share Rs15.47 Rs12.93 Rs13.98 Inventory turnover 75 days 88 days 93 days Debtors holding 151 days 172 days 145 days For conversion to SGD, please use an average exchange rate of S$1: Rs for Sept 2007

12 1H FY08 Performance

13 Revenue Rs'm Agrochemicals division i i +28.3% 2,000 Higher quantity sales of Acephate 1,500 1, , H07 1H08 Pigments division -6.9% Domestic sales of Pigments affected due to breakage in effluent treatment pipe line of Pigment Panoli division owned and installed by Bharuch Environ Infrastructure Limited (BEIL). Trading sales not shown. Pigments Agrochemicals Group s Agrochemicals division i i outpaced Pigments division

14 Revenue by Geographical Market 2Q 08 By Geographical Market Export sales +29.4% to Rs m Domestic sales +19.6% to Rs m 40.9%42.8% 2Q 07 1H % 59.1% Export Domestic By Geographical Market Export sales +14.5% to Rs m Domestic sales +28.1% to Rs m 38.1% 35.5% 1H % 61.9% Export Domestic

15 Gross Profit Rs'm 1, For Agrochemicals: Percentage of gross profit increased marginally while profit margin reduced, due to pressure on pricing on all Agrochemical products For Pigments: Gross profit suffered due to less quantity sales. 1H07 1H08 Pigments Agrochemicals

16 Gross Margin Analysis Gross Margin 2Q08 (%) 2Q07 (%) Chg (% pts) 1H08 (%) 1H07 (%) Chg (%pts) Pigments (18.6) Agrochemicals Total Pigments gross profit suffered due to less quantity sales due to less production for the reasons beyond the control of Management. Agrochemicals percentage gross profit increased marginally due to pressure on pricing on all Agrochemical products.

17 Cost Structure In Rs m 2Q08 2Q07 % Chg 1H08 1H07 % Chg COS (1,381.7) (1,056.1) 30.8 (2,245.6) (1,850.4) 21.4 Distribution expenses (143.7) (119.5) 20.2 (240.4) (215.6) 11.5 Admin. expenses (49.3) (54.9) (10.2) (82.5) (84.2) (2.1) Other operating expenses (16.9) (0.7) (28.9) 22.3 (229.3) Finance cost (36.1) (28.2) 2) 28.1 (76.5) (50.5) 5) Costs increase in tandem with sharply improved export sales Distribution costs increased in line with rise in sales Administrative costs lowered by 10.2% to RS 49.3million Other operating expenses mainly due to Indian Rupee become stronger against US Dollar

18 Capacity Utilisation: Pigments M T p a % 12, 000 Installed capacity U t lis a t io n 200% 10,000 8, % 139% 113% 150% 6,000 77% 100% 4,000 10,200 50% 50% 2,000 3, , % P G 7 CPC B lu e Alpha B lu e Beta B lu e Pigm Addit ent iv e s Production up to

19 Capacity Utilisation: Agrochemicals M T p a 2,000 Installed capacity U t lis a t io n % 250% 1, , % 1,400 1,200 1,000 1, % 134% 150% % 1, % % 1, ,000 14% 60 50% 0% M P B /M PB A CMA C/CMA Ac ephate Cyper m e th r in Per m e th r in Al Cyper pha m e th r in Chlorp yriphos Production up to

20 Outlook & Business Strategies

21 Growth Strategies Expand production capacity Pigments Increase production of PG7 plant at Vatva Evaluating possibilities of expanding PB capacities of Panoli plant Agrochemicals Installed multi-faceted production capacities to produce Permethrin, Alpha Cypermethrin and Acephate at Ankleshwar Plants New Products Introduce new range of High Performance Pigments (HPP) for global customers 430 new registrations in the pipeline in 60 countries in various stages Gains expected from new registrations in Brazil and Pakistan Other Outsourcing opportunities: India s ability to provide high quality manufacturing attracting a higher level of outsourcing from companies in developed countries Focus on domestic branded formulations Meghmani Energy Limited Captive power plant at Chhrodi unit Meghmani Finechem Limited Caustic Chlorine project at Dahej

22 Our Future Roadmap

23 Meghmani Finechem Limited

24 Project Status Acquired 650,000 sq. mts land in Dahej Major Technology tie ups for Caustic-Chlorine Complex (AKCC) for CPP (Cethar Vessels) for detailed engineering (Simon India Limited) Recruited 1 VP, 4 AGM, 3 Consultants Project investment: 504 crores Expected date for the commencement of the 1 st phase: December 2008 or January 2009

25 Why Gujarat? 5% of India s population contributes to 16% industrial production Largest coastline in India 1600 kms Highest production of salt in India 41 ports, 11 airports, best road and rail connectivity Availability of low cost yet skilled labour Power infrastructure Well connected to major cities in the USA, EU, Asia, Middle-East and other major Indian cities Well developed chemical belt

26 Why Dahej? Strategically located on the Chemical belt of India Proximity to port, rail, highways, and SEZ Proximity to salt fields Proximity to Caustic-Chlorine consuming industries Plentiful l availability of soft river water Dahej - a new industrial area in focus

27 Why MOL? Acquisition of land in Dahej a strategic move Captive power plant of 40 MGW Strong growth fundamentals Meghmani Group a well known and respectable name in the Chemicals field Fully geared up for chemical outsourcing trend A transparent company lead by techno-commercial promoters and professional management

28 Summary: Proposed Caustic Chlorine Complex What: A special purpose vehicle incorporated on 11 Sep 2007 to set up a Caustic Chlorine Complex in Dahej The large-scale, integrated complex will be used for the production of Caustic Soda Lye/Flakes, Chlorine Gas and Hydrogen Gas. Estimated cost and Proposed funding: Approximately Rs crores (S$186.47m) Funded Rs crores (S$ m) by Debt and Rs crores (S$58.92m) by Equity/Quasi equity. Significance for Meghmani: Achieve inorganic growth and vertical integration in a diversified yet chemistry-related business A ready and captive source of some basic chemicals for Meghmani s Pigments and Agrochemicals operations Dahej a strategic location for chemical and related industries Phase 1 of the project is expected to commence by December 2008 / January Phase 2 will comprise the production of derivative products with higher value-add. The annual manufacturing capacity of the complex will be as follows: Caustic Soda 113,000 Ton per Annum (TPA) Chlorine Gas 100,000 TPA Hydrogen Gas 258,000 NM3 Diluted Sulphuric Acid 2,600 TPA Hydrochloric Acid 9,970 TPA Sodium Hypo Chloride 8,300 TPA

29 Thank You Q & As