dil_investor_presentation_june10

8/8/2019 dil_investor_presentation_june10

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Cor o r at e Pr o f i le

Jun e , 20 10

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IndexIndex

-

FMCG Industry Scenario

Business Overview

Growth Strategy

Recent Performance

2

2



Dabur India: Key HighlightsDabur India: Key Highlights

9 Leading personal and healthcare company : Among top four FMCG Companies in India

9 Revenue of more than Rs. 34.2 billion and profits of more than Rs. 5.0 billion in FY2009-10

9 Stron brand e uit

Dabur is a household brand

Vatika and Real are Superbrands’ ,

9 Wide distribution network covering 2.8 million retailers across the country

9 Strong overseas presence with 18% contribution to consolidated sales

Eigh t B i l l ion Rupee Brand s

3

3



Strong FinancialsStrong Financials

40000

Sales

i n Rs. m i l l ion

10,997 12,004 12,849 12,356 14,17017,565

20,80323,963

28,341,

15000

20000

25000

30000

35000

0

5000

FY01 FY02 FY03 FY04^ FY05 FY06* FY07 FY08 FY09 FY10**

22.0%

in %

EB I T D A M ar g i n ( i n % ) Net Pro f i t

i n Rs . m i l l i on

2,142 2,817

3,3293,913

5,032

3000

4000

5000

6000

13.3%

15.3%

17.1%18.1%18.5%18.3%

.

16.0%

18.0%

20.0%

1,065,

0

1000

2000

FY04 FY05 FY06 FY07 FY08 FY09 FY10

10.0%

12.0%

.

FY04 FY05 FY06 FY07 FY08 FY09 FY10

4

4

^ Sales show a decline in FY04 on account of de- merger of Pharm a business * Balsara acquisition added 10% to t opline in FY06 * * Fem acquisition added 3.5% to t opline in FY10



Key MilestonesKey Milestones

1 8 8 4

•The birth of Dabur

1 9 7 2

•The company shiftsbase to Delhi from

1 9 8 6

•Registered as PublicLimited Company

1 9 9 4

•Listed on the BombayStock Exchange

Kolkata

1 9 9 8

•Professional teaminducted to run thecompany

2 0 0 0

•Crosses Rs 1000Crore Turnover

2 0 0 3

•PharmaceuticalBusiness de-mergedto focus on coreFMCG

2 0 0 4

•Profit exceeds Rs.100Crore

2 0 0 5

•Ac uires Balsara

2 0 0 6

•Dabur Fi ures in To

2 0 0 7

•Dabur ranked amon

2 0 0 8

•Ac uired Fem Carestrengthening Oralcare & provided entryinto Home caresegment

10 Great Places ToWork

'Asia's Best Under ABillion' enterprises byForbes

Pharma entering themainstream Skin caresegment

2 0 1 0

•Touched US$3.5billion market cap

5

5



Strong Manufacturing BackboneStrong Manufacturing Backbone

Man u fact ur in g Locat ion s - Glob al Man u f act ur in g Locat ion s in I n d ia

3

4

Niger iaNiger iaEgyptEgypt

UAE

Bi rgan j , Nepa l1

5 6

7

Bangladesh

Nepa l

8

. a a a , .

2. Uttaranchal

3.Baddi, H.P

4.Jammu, J&K

5.Katni, M.P

6.Siliguri, W.B

7.Jaipur, RajasthanManufacturing Facilities

6

6

. vassa



Robust Distribution NetworkRobust Distribution Network

Factory

C&FA

(Carry & Forward Agents)

t oc st u p er t oc st I n s t i t u t i o n s& M od e r n

t r a d e

W h olesaler s Su b St ock ist

RETAI L TRADE

CONSUMERS

7

7

Di rect + I nd i r ect Reach cove r ing 2 .8 Mn Re ta i l Ou t le ts



Research & Development StrengthsResearch & Development Strengths

Co l l abo ra t i on w i th ov t

D ab u r i n t r o d u ce d m o r e t h a n 2 0 n e w p r o d u ct s / v a r i an t s d u r i n g FY0 9

9 Ayur ved ic Med icines

9 Personal Care

agenc ies

9 Foods

9 Hom e Care

eam o sc en s sinc lud ing Ayu rv ed i c doc to rs ,Pharm acis ts , Ag ro -nom is ts ,Botan is ts , Tissue Cu l t u r e

9 OTC Heal t hcare,

A gr o n o m y I n i t i at i v e s

9 Pro tec t i ng endange red he rbs

En v i r o n m e n t a l I n i t i a t i ve s

9 Ef f luen t Management

9 Techn ica l ass istan ce to fa rm ers

9 Con t r act cu l t i va t i on o f he rbs

9

9 Al te rn a te sources o f energy

9 Carbon foo tp r i n t m app ing

8

8



Ayurveda – The Science of LifeAyurveda – The Science of Life

9 Ayurveda – The core philosophy

9 Traditional Indian system of medicine

9 Ayurveda, the ancient Indian system of medicine basedon natural and holistic living, derives from two Sanskritwords - Ayu or life, and Veda or knowledge.

9 This Science of Life analyses the human body through acombination of the body, mind and spirit.

9 Originating nearly 5,000 years ago, Ayurvedic texts wereresearched by Dabur in its quest for natural remedies.Today, its application in modern life has been renewed

roug e sc en c researc an va a on un er a en

at Dabur

9 Dabur has 125 years experience & knowledge

9 Successful extension of Ayurveda into personalcare and OTC healthcare

ng g o a ren o ac o a ure

9

9



IndexIndex

-

FMCG I nd us t r y Scenar io

Business Overview

Growth Strategy

Recent Performance

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10



FMCG Industry SnapshotFMCG Industry Snapshot

Key H igh l i gh ts FMCG I ndu str y Size

Indian FMCG industry size estimated ataround US$ 25 bn.

Personal care & Food products dominate the

sector

Many categories are currently small andoffer huge potential

in Rs. i ion

2 0 0 8

2 0 0 9

FMCG Industry Size 1,023.9 1,161.1

Steady double digit growth in the sector

Rural India contributes c. 33% of the overallFMCG sector.

Growth rate (%) 13.4%

Personal CareBaby Care Household Others

Categor y -w ise share o f th e Sec to rFMCG Grow th : Urban & Rura l

Source: AC Nielsen

18%20%

22%

Hair Care

8%

OTC Products

4%

3%

9%10%

12%

12%

15%

11%

10%

12%

5%

10%

15%

Food Products

43%

Fabric Care

12%-8%

-1%

-10%

-5%

0%

CY03 CY04 CY05 CY06 CY07 CY08 CY09

U r b a n Ru r a l

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11

Source: AC NielsenSource: AC Nielsen



India: Consumption StoryIndia: Consumption Story

Aggrega te Consum pt ion across I ncom e Bracke ts

4 x 7 0in tr illion, I ndian Rupees, 2000

3 4 Midd le

71 0

1 7

'

Source : Mckinsey Global Institute Analysis

Midd le Class

,

f r o m cu r r e n t p o s it i o n o f t w e lf t h

Note:

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12

Annual Income (in Indian Rupees, 2000): Globals >1,000,000; Strivers =500,000-1,000,000;

Seekers=200,000-499,999; Aspirers=90,000-199,999; Deprived=<90,000



Penetration Levels: Sufficient HeadroomPenetration Levels: Sufficient Headroom

77% 80%90%

42% 37%

67%57% 59%

40%

50%

60%

70%

18% 18%

0%

10%

20%

30%

Toothpaste Shampoo Hair Oil Skin Cream MosquitoRepellants

Source: Industry Data, IIFL

9 Low penetration levels offer room for growth across consumption categories9 Rural penetration catching up with urban penetration levels

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Per Capita Consumption: Room for GrowthPer Capita Consumption: Room for Growth

Skin Care – Per Cap i ta Consum pt ion ( in US$) Sham poo – Pe r Cap i ta Consump t i on ( i n US$)

I n d i a h a s l o w p e r ca p i t a co n s u m p t i o n a s co m p a r e d t o o th e r e m e r g in g e co n o m ies

7.4 7.7

5

6

7

8

9 2.72.4

2

2.5

3

in US$ in US$

3.2

0.80.3

0

1

2

3

4 1.0 1.1

0.3

0

0.5

1

1.5

China Indonesia India Malaysia Thailand China Indonesia India Malaysia Thailand

Too thpas te – Pe r Cap i ta Consump t i on ( i n US$)

2.9

2.02

2.5

3

3.5in US$

0.5

1.0

0.4

0

0.5

1

1.5

14

14

Source: MOSL



Key Players: FMCGKey Players: FMCGUSD Million

Com p an y Key Cat ego r ies Sales Pr o f i t Mar k et Cap

Hindus tan Un i l eve r L td Soaps, Detergents, Personal Care, Foods 4 ,6 3 8 5 5 7 1 1 ,3 2 5

Nest le I nd ia Ltd * Food, Beverages, Infant nutrition 1 ,1 4 0 1 4 6 5 ,9 9 9

Dabu r I n d ia Lt d Per son al , Heal t h & Hom ecar e, Foods 7 5 3 1 1 2 3 ,5 1 6

Br i tann ia I ndus t r i es Ltd * Biscuits 7 6 0 3 4 8 7 2

Co lga te Pa lmo l i ve ( I ) L td * Oral Care & Toiletries 3 7 7 6 4 2 ,1 9 1

Mar ico Ltd . Hair care, Food, Skincare 5 9 1 5 1 1 ,5 2 6

Gl ax o Sm i t h k l i n e Co n su m e r * Consumer Health Care 4 2 7 5 2 1 ,5 7 0

Godre j Consum er Products L td Hair Care, Soaps 4 5 4 7 5 2 ,3 0 9

Procte r & Gam ble^ Feminine Hygiene, personal care 1 7 2 4 0 1 ,3 9 9

Source: Published results for year ending 31.03.10

*Year ending 31.12.09

^Year ending 30.06.09

Note: Market Cap. as of 17.05.10

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Dabur: Strong Presence in FMCG CategoriesDabur: Strong Presence in FMCG Categories

Marke t SharePosi t ion Key Br an d sCategory

Hair Care

12%3Dabur Amla hair Oil, Vatika hair oil & Vatika Shampoos

Red tooth aste Babool Meswak Redra are

toothpowder

7%3 Dabur Gulabari, Fem, Dabur UvedaSkin Care

Chyawanprash 63%1 Dabur Chyawanprash

Digestives 55%1 Hajmola

Fruit Juices 45%1 Real Fruit Juices, Real Activ

Hair care includes Hair Oils & Shampoos;Oral care includes Toothpastes & Toothpowder;

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n care nc u es mo s ur zers, ace c ean ng, g en ng, an age ng o er s n care pro uc sDigestives includes herbal digestives



IndexIndex

-


Business Over v iew

Growth Strategy

Recent Performance

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Business StructureBusiness Structure

Bu sin ess Un i t Descr ip t ion

Dabur ope ra tes th rou gh t h ree focused St ra t eg i c Business Un i t s

Revenue

Con sum er Car e

FMCG p or t f o l io com pr isin g f ou r

d i st i n c t b u s i n esse s:• Pe r son a l Ca r e

Div is ion • H ea lt h Ca r e• H om e Ca r e• Foods

Consum er Hea l thDiv is ion

Ran g e o f e t hica l an d OTC p r od u ct st hat d el i v er t he age- o ld b en ef i t s o fAy u r v ed a in m od er n r eady - t o - u se 8 %

Cat er s t o t he h eal t h & p er son al car en eed s o f cu st om er s acr oss d if fer en t

n er n a on aBus iness

i n t er n at ion al m ar k et s sp an n in gMid d le East , No r t h & W est Af r i ca ,Sou t h Asia , EU an d US t h r ou g h i t sb ran ds Dab ur an d Vat ik a

1 8 %

18

18

Note: Percentage share in revenue based on FY10 Financials ; Femcare included in Consumer Care Division



Consumer Care Division OverviewConsumer Care Division Overview

HCPDFPD Balsara Foods FEM

FPD: Family Products Division

2 0 0 3 - 2 0 0 4 2 0 0 6 - 2 0 0 7 2 0 0 7 - 2 0 0 8 2 0 0 8 - 2 0 0 9

HCPD: Health Care Products Division

Balsara and Fem were acquisitions

Foods division was a 100% subsidiary of DIL

in Rs. m i l l ion

CCD Sales - H is to r i ca lCat egor y- w ise Shar e of CCD Sales

Hair CareHome Foods

31.4%

Digestives

8.6%

Skin

Care

2.4%

are

5.2%

.

Oral Care

Health

Suppleme

nts

19

19

Note: Percentage share in revenue for FY10

..



Brand OverviewBrand Overview

Hea l th

Persona lCare

Care

Foods

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Brand ArchitectureBrand Architecture

9 Starting from Ayurveda , the company successfully ventured into herbal

arena becoming t he ‘Herba l Spec ia l is t ’

9 While herbal businesses form the core with 85% of revenues, the

company’s growth ambitions are not limited by it.

9 A robust brand architecture ensures that the core values remain intact

Brand A rch i tec tu r e

Her b al Sp ace Nat u r a l / Non - h er b al Sp ace

DaburHerbal

Healthcare

Vat i kaPremiumPersonal

Care

H a j m o l aTasty

Digestives

RealFruit

Beverages

BalsaraHome Care

UvedaAyurvedic

Skin care

FEMFairness Skin

solutions

Rs 17 .0 bn Rs 3.9 b n Rs 1.4 b n NA Rs 3 .0 b n Rs 1.3 b n

Rs 1.0 b n

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ran s ze per a ns o - sa es n n a an overseas; em a sa es o a ou s. mn n overseas mar e s n



Consumer Care CategoriesConsumer Care Categories

Marke t ShareKey B rands

Hair Oi l

16%

3%

37%

6%

31%

Bajaj Dabur Dey's Medical

Emami Marico Others Dabur Amla: Vatika: Value added Anmol Hair Oil:

the portfolio - ,

Ke Br an d s

Shampoo

11.2% 6.0%

23.8%

13.5%

Marke t Share

45.5%

Cavinkare Dabur

22

22

HUL P&G

Vatika range of shampoos Dabur Total Protect

Ayurvedic ShampooValue Share-ACN Mar, 10



Consumer Care Categories (Contd.)Consumer Care Categories (Contd.)

14.3%


Oral Car e

49.7%

13.2%

22.8%

Colgate HUL Dabur Others

-

Dabur Red: Toothpaste& Toothpowder

Babool: Targeted ateconomy segment

Meswak: Premiumtherapeutic

Ch y a w a n p r a s h – M ar k e t Sh a r e

,

Key Brand sHea l th Supp lem en ts

12.7%

7.9%

5.6% 11.1%

.

Baidyanath Dabur Emami Zandu Others

Dabur Honey: Largest

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23

Value Share-ACN March, 2010

Largest selling health

supplement in thecountry

a ur ucose:2nd largest

player in thecountry

branded honey in thecountry; growingcategory through replacesugar strategy





Foods

45%15.5%

3.7%

36.4%

Dabur Pepsi Priya Gold Others

Real: Flagship Real Activ: Range Real Burrst: New

Marke t Share*

Va ue S are-ACN May, 09 ; Fruit Juice category beverages brand of 100% pure juice fruit Drink brand

Ke Br an d s

Sk in Car e

58.9%

6.4%

3.2%

18.0%

6.8%

6.6%

Hindustan Lever Emami Dabur

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24

Loreal Cavin Care Others

*Company estimates; Includes Fem skin care portfolioproducts: Moisturizer, Face freshener

& Rose water

Acquired recently




Marke t Share Key B randsDiges t i ves

55%

8%

Hajmola Satmola Others

Value Share-ACN March 2010

Hajmola: Flagship brandfor branded Digestives

Hajmola tastydigestive candy

Ai r Freshene rs – Marke t Sha reKey Brand s

Hom e Care

20%26%

20%

30%

5%

Odonil Air wick Premium Ambipur Others

25

25

Value Share-ACN March, 2010 for Aerosols category

range: Largest brand

in the portfolio

repellant skin cream

Toilet cleaner



Fem CareFem Care9

Fem Care was acquired on June 25, 2009 and has been merged with Dabur India Ltd.retrospectively from April 1, 2009

9 Fem Care grew by 16.6% during 1st July 2009 to 31st March 2010 inspite of portfolio

9 During the period 1st July 2009 to 31st March 2010, PAT of Fem Care increased toRs.18.5 crore led by expansion in EBITDA margins from 12% to 28%

ey n t at v es r v n g g r ow t :

9 Continuous media presence across key categories with national TV campaign for FemHerbal Bleach, Oxy bleach & Hair Removal System (HRS).

a ng ran s more v s e across ra e c anne s.

9 Building the superiority of FEM bleaches through seminars & demonstrations

9 Parlor channel being leveraged and scaled up; parlour seminars held in key cities

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Oxy Bleach International Fashion Week in MediaVisibility Drives



Consumer Health DivisionConsumer Health DivisionDescr ip t ion

Dabur is the largest OTC Healthcare companyin India (Source: Nicholas Hall’s OTCYearbook 2008)

CHD St ru c tu re

CHD: Repository of Dabur’s Ayurvedic

Healthcare knowledge

Plans underway to build a comprehensive

strategy for a greater push in OTC Health

9 Generics

9 Branded Products

9 Tonic

9 Classicals

space

Range of over 260 products

Focusing on multiple therapeutic areas.

Distribution coverage of 100,000 chemists,

~ , ,

pharmacies Partnership with Institutions such as

Dhanwantry Ayurvedic Hospital for clinicaltrials Honi- Mint Extension

Thrust on OTC portfolio to leverage the hugeself medication market

OTC portfolio

Branded portfolio

of Honitus u n ara : ea ngDigestives OTC brand

First ever Adspend on Hingoliin Seven years

Dabur Honitus-Syrup & Lozenges forCough/Cold,Badam Tail, Dabur activeantacid, Dabur Active Blood Purifier.

Generics

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27

Ashokarishta & Dashmularishta (Women'shealth), Lavan Bhaskar Churna

Focus on Dabur Ayurveda: Generatingequity for Ethical portfolio In shop activations



International Business DivisionInternational Business Division Started as an

Exporter

Focus on Orderfulfillment throughIndia Mfg.

Set up a franchisee at

Dubai in 1989

Demand generationled to setting up of mfg in Dubai & Egypt

Renamed franchisee as Dabur

International Ltd

Local operations further strengthened

Set up new mfg facilities in Nigeria,RAK& Bangladesh

Building scale-20% of

overall Dabur Sales (FY09)

High Levels of Localization

Global Supply chain

1 9 8 0 ’s Ear ly 9 0 ’s 2 0 0 3 On w ar ds Tod ay

High l i gh ts

Dabur’s overseas business contributes 18%to consolidated sales led by CAGR of 29% inlast 6 years

H i gh Gr o w t h i n I B D

in Rs. m i l l ion

Focus mar ets:

GCC Egypt

Nigeria

Bangladesh

Nepal

U.S.

High level of localization of manufacturing

N ew p r o d u ct s c o n t r i b u t i n g

and sales and marketing

Leveraging the “Natural” preference amonglocal consumers to increase share in personalcare categories

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s ign i f i can t l y to overseas sa les

marketing



International Business – Product PortfolioInternational Business – Product Portfolio

Hai r O i ls

Ex ist in g Pr od u ct s NPDs an d Relau n ch es

V at i k a Sh a m p o o sVat i k a H am a m Zai t h – Hai r Fa l l Con t r o l

V at i ka Co n d i t i o n er s

Ha i r Cream s

Ha i r T rea tmen ts a t a er m o v a oap s

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IndexIndex

-


Business Overview

Gro w t h St r a t e g y

Recent Performance

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30



Growth StrategyGrowth Strategy

EXPAND

DABURINDIA

LIMITED

THREE PRONGED STRATEGY FOR SUSTAI NI NG GROW TH

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Expansion StrategyExpansion Strategy

Targe t i ng i no r gan ico p p o r t u n i t i e s9 Marke t En t r : Ac uisitions

St r eng then ing new ca tego r ies9 Sk in Care: Ayurvedic skin care

range under a new brand

critical for building scale inexisting categories & markets

9 Synerg ies: Should be

synergistic and make a good

launched; Acquisition of Fem9 OTC Heal t hcar e: Leveraging

Ayurveda knowledge for a

range of OTC herbal products

9 Geograph ies: Opportunities infocus markets

Entry into the fast growing fruitdrinks category leveraging theReal franchise

Exp and in g across geograph ies

St r o n g i n n o vat i o n p r o g r a m m e

overall company; target tosustain higher growth rates

9 So u t h I n d i a: Increased

contribution from 7% to 12%;

contribute 5-6% of revenues9 Focus Cat egor ies: New

product activations planned up

in all categories Continued focus on the

relevant portfolio to growcontribution

en ov at o n: Perio ic ranrenovations to keep olderproducts salient

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IndexIndex

-


Business Overview

Growth Strategy

Recen t Pe r fo r m ance

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Financial Performance – FY2010 (Audited)Financial Performance – FY2010 (Audited)

Sales: FY10 v / s FY09


EBI TDA Marg in : FY10 v / s FY09

18.3%

19.6%

19.00%

19.50%

20.00%

28,34134,167

20000

30000

40000

17.50%

18.00%

.

FY09 FY10

0

10000

FY09 FY10

9 Sales growth led primarily by continued doubledigit volume growth

PAT* : FY10 v / s FY09


3,9125,032

4000

6000

-09 and merged with DIL w.e.f. April 1, 2009added about 3.5% in FY10 to topline.

9 EBITDA margin expanded by 130 bps during

FY10 led b lower in ut costs.

0

2000

FY09 FY10

9 PAT increased by 28.6% during FY10 due tostrong topline, improving gross margins andoperating leverage despite higher ad spend & tax provisioning

34

34* PAT refers to Net Profit after Minority Interest



Stock Performance & Shareholding PatternStock Performance & Shareholding Pattern

FIIs, 14.5 Indian

Shareho ld i ng St r uc tu re *Dabur ’s S tock Pr i ce v is -à -v is N I FTY

Promoters,

69.0%

Banks/FIs/

Insurance

Cos., 8.0%

Pu ic anOthers, 6.

6%

Mutual

Funds, 1.9%

*As on April 30, 2010Prices rebased to 100

D ab u r Ou t p e r f o r m e d t h e i n d ex b y 2 6 % d u r i n g t h e p e r i od M ay 2 0 0 9 t o A p r i l 2 0 1 0

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35



AccoladesAccolades

an e n - r anEqu i t y Mos t T rus tedBrands 2009 l i s t .

L i sted in Fo rbes ’ 200Best Under -A-B i l l ionCom panies L is t

Ranked 79 t h i n 'Super 100 'l i s t annou nced by Bus inessI n d i a

Ra n k e d 2 5 t h m o s tva luab le b rand in t he l i s to f I n d i a ' s 1 0 0 M os tValuab le Brand s, by 4Ps.

Vo ted as the fou r th Mos t

Dabur I nd ia L td has been

aw arded the Top Marke te r

D ab u r I n d i a Lt d w a sranked t he Bus inessLeader i n t he FMCG -Personal Care Catego ry a tth e NDTV Prof i t Bus iness

Ranked 18 2 in ET-500 , t heannua l l i s t i ng o f I nd ia ' s BlueChip com panies by TheEconom ic Tim es.A lso ranked as the fou r thlargest p ure- p lay FMCG

Liked Hea l th B rand in t hec o u n t r y i n c o n s u m e rsu rvey conduc ted by'Com p le te We l lbe ing 'magaz ine

w ar o r n eConsum er Goods categoryby P i t ch magaz ine

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c o m p a n y i n t h e l i st .



Investor Relations

Dabur India Ltd

Contact:+91-11-42786000

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dil_investor_presentation_june10

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