pennar industries q2fy15 investor presentation

7/24/2019 Pennar Industries q2fy15 Investor Presentation

1/21

Pennar Industries LimitedEngineering Excellence

Investor

Presentation

Q2FY15


2/21

Disclaimer

This presentation contains statements that contain forward looking statements including, bulimitation, statements relating to the implementation of strategic initiatives, and other statemen

Pennar Industries Limited and its subsidiary companies (Pennar) future business developmeperformance.

While these forward looking statements indicate our assessment and future expectations concerndevelopment of our business, a number of risks, uncertainties and other unknown factors could developments and results to differ materially from our expectations.

These factors include, but are not limited to, general market, macro-economic, governmental antrends, movements in currency exchange and interest rates, competitive pressures, technologicachanges in the financial conditions of third parties dealing with us, legislative developments, anthat could affect our business and financial performance.

Pennar undertakes no obligation to periodically revise any forward looking statements to reflectevents or circumstances.

PENNAR INDUSTRIES LIMITED


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Agenda

1. Quarter Performance

Financial Performance Segment Performance

Segment Composition

Business Segment: Q2FY15 Highlights

2. Pennar Group Business Structure, Holdings

Business Segments, Subsidiaries

Distributed Manufacturing

Business Structure

Leadership Team

Share Price Performance



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Q2FY15

Pennar Industries Limited

Quarter Performance


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Financial Performance

Net Sales of INR 289 Crs; 21% YoY ; 5% QoQ

EBITDA margin at 8.4%

Net Sales of Rs. 195 Crs; 15%

EBITDA margin at 8.1%

Consolidated Standalone


Net Revenues (Rs. Crores) and EBITDA margins (%)

238.3

276.7

289.2

7.8%

8.1%

8.4%

Q2FY14 Q1FY15 Q2FY15

170.1

168.5

7.5%

8.2%

Q2FY14 Q1FY15


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Highlights of Q2FY15 performance

Q2 HIGHLIGHTS

Strong performance during Q2FY15 - 21% YoY; 5% QoQ - driven by all segments, t

Growth driven by new customers and existing customers increasing the scope of o

new orders

Substantial new order wins in Q2

Increasing product portfolio across all four business verticals and two subsidiaries

OTHER HIGHLIGHTS Strong Balance Sheet

CAPEX for new products/business lines entirely funded via internal accruals



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Segment PerformanceNet Revenues (Rs. Crores) and EBITDA margi


102.0 101.4

100.2

6.6%6.3%

5.4%

0.0%

1.0%

2.0%

3.0%

4.0%5.0%

6.0%

7.0%

0

20

40

60

80

100

120


Steel Products

30.3

36.233.7

4.8%

6.2%

6.8%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

0

5

10

15

20

25

30

35

40


Tubes

11.9

12.6%

0

2

4

6

8

1012

14

16

Q2FY14

Indus

25.8

16.2

48.7

11.7%

18.9%

12.9%

0.0%

5.0%

10.0%

15.0%

20.0%

0

10

20

30

40

50

60


Systems & Projects

70.0

101.391.0

9.0%

8.4%

8.7%

8.0%

8.2%

8.4%

8.6%

8.8%

9.0%

9.2%

0

20

40

60

80

100

120


Pre-Engineered Buildings

0

1

2

3

4

5

6

7

8

Q2FY14 Q

Pen


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Segment Composition


Outlook

PEBS, PEL and Systems & Projects

share of revenues will increase

further as their growth rates are

higher than the average growth

rate.

Tubes will maintain its revenue

share while improving margins. Steel products will decline in

revenue share as lower margin

segments stagnate.

SteelProducts

34%

Tubes12%

Systems and Projects

IndustrialComponents

Pre-EngineeredBuildings

Pennar Enviro

8%

10%

4

4

3%

5%

9%3%

14%

2%

4%

31%

2% Gener

ERW Tu

CDW Tubes

Solar

Railways

16%


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Business Segment Highlights - Steel Products

Quarter performance

New orders received from Hamon Research, Cottrell,

Cethar Limited, SKS Power Generation Limited, HBL,

Thermax, etc. Existing customers have increased orders in Profiles

sub-segment.

Introducing Special Grade Steels.

Switching to Special Grade while reducing low

contribution products.

Outlook

Major orders for H2 booked already.

Sales for Q2FY15 is at

Rs. 100 Crores

10 % of revenue isfrom new business

To concentrate on

Special Grades


102.0

6.6%

0

20

40

60

80

100

120

Q2FY14

St


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Business Segment Highlights - Tubes

Quarter performance

ERW saw a growth of 15% compared with Q2FY14

while CDW grew by 50%.

Infra/power sector products were slow moving and

the business vertical did well only in automotive

because of 2-wheeler volumes.

Major customers in Auto - M/s. ALFengg, VECV,

PHI/PHA- Hyundai vendors, Patton, LMW, Bajaj

vendors, Gabriel, M.G/Alma, TVS vendors. In Power -

Isgec, Thermax, BGR, Paharpur, JSW, CPCL, HPCL, SPIC,

Hindalco etc.

Market Share - ERW: 5%; CDW: 6%

Capacity expansion of 300T in CDW and 500T in ERW

by December 2014.

Total Customers >100.

Market Share -

ERW: 5%; CDW: 6%

60% of business is repeatbusiness;

15 new customers added

10% of Q2 businesscame from newproducts/customers


30.3

4.8%

0

5

10

15

20

25

30

3540

Q2FY14


11/21

Business Segment Highlights-Industrial Compon

Quarter performance

Repeat Orders from existing customers

Expanded business with existing customers.

New orders from large firms for Wedge Barrier, GuideBracket, Yoke Rotor cups and Bead plates.

Automotive showing early signs of recovery.

Focusing on critical high performance components for

brake, suspension and auto electrical applications.

Identifying global sourcing and deemed export

opportunities.

White goods Slide continues

Identifying opportunities of deep-drawn products inother consumer and safety equipment segments.

General Engineering

Identifying sub-assembly opportunities by leveraging

capabilities of fabrication & pressed components.

Hydraulics cylinders

Sample order from Bailey USA received.


Rs. 13 Crores

Automotiveshowing signs of mildrecovery

Growing Hydraulicsbusiness


11.9

12.6%

1

0

2

4

6

8

10

12

1416

Q2FY14 Q

Industri


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Business Segment Highlights - Systems & Proje

Quarter Performance

Railways

Q2 opened with an order book of Rs. 90 crores.

Rs. 18 crores of orders received from wagon builders.

In dialogue for supply of CRF sections for metro coach

applications. Also for CRF sections for Delhi metro.

Order for manufacturing of complete under frame

arrangement for ICF coaches in progress. Additionally,

orders for manufacturing of 68 coach sets of stainless

steel Sidewall and Roof Assemblies in progress.Solar

Received large order from L&T Construction - Solar

Division - to be executed in Q3.

Additional order from L &T to be executed in Nov'14.

Single largest order from Mahindra EPC to be executed

between Dec'14 and Feb'15.

Sales for Q2FY15 up

201% QoQ

Railway businessuptrend visible

Railways is 14 % andSolar is 2% of segmentrevenues


25.8

11.7%

0

10

20

30

40

50

60

Q2FY14

Syste


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Subsidiary Highlights - PEBS

Quarter Performance

50+ new orders received this quarter

Major orders include - MRF, Reliance Jio Infocomm,

UltraTech Cement, KRIDL, Zillion Infra , L&T, Deify

Infrastructures, Caldreys Refractories, Azure power

etc.

35+ new customers added during quarter.

Repeat orders from 8 existing customers.


Rs. 91 Crores

Capacity 90,000 MT

50% of revenue fromnew business/ customers

Total customers at 550


L&T Metro stati

70.0

9.0%

0

20

40

60

80

100120

Q2FY14

Pre-Eng


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Subsidiary Highlights - Pennar Enviro

Quarter performance

New Customers

Chemicals JSW Bellary, I G Petrochemicals, Jayapee

Balaji Cement, SR International Paper, Amtek Auto

O&M Veeraya Power, Kalpathruvu Distilleries

Projects Lanco Infratech

Repeat Orders

Chemicals - Hero Cycles, Deepak Nitrite Ltd, Goodyear

India Limited

O&M - Silk Road Sugars, SLN coffee

Order book currently at

Rs. 41 Crores

30 % of revenue isfrom new business

Customer base

Chemicals-170,

O&M-40 , Projects - 30


0

1

2

3

4

5

6

78

Q2FY14

Pe


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Q2FY15


Pennar Group


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Business Segments, Subsidiaries

STEEL PRODUCTS

Automobiles General Engineering

Infrastructure

White Goods

Automobiles Industrial

White Goods

Hydraulics

Pre-engineeredbuilding structures

Warehouses

Airports and aircraft

hangers

Turnkey buildings

Leak proof roofing

sheets

INDUSTRIAL

COMPONENTS

Railways: Coachesand Wagons

Solar: Mounting

Structures

SYSTEMS &

PROJECTS

Automobiles Power

TUBES



17/21

Distributed Manufacturing

Coaches

Components/ Hydraulics

Auto Profile

Building Pro

Railway Compone

ESP/ Building

Sheet Piles/ Solar

Press Components

ESPAuto Profiles

Solar

Building Products

CRSS

ProfilesSolar

ERW/ CDW Tubes

Tarapur Chennai

PatancheruIsnapur4 Locations

ProfilesF



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Business Structure



Segments: Steel Products; Tubes;

Systems & Projects; Industrial

Components.

Pre-engineered building

systems (PEBS); Roof Top

Solar, Solar EPC.

Industrial water t

solutions, Water

chemicals and Fu

Market Cap as of Sep

~Rs. 650 C


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Leadership Team

Leadership Team

Nrupend er Rao

Executive Chairman

Pennar Group

Adit ya N. Rao

Vice Chairman,

Managing Director,

Pennar Industries

P. V. Rao

Managing Director

PEBS Pennar

Sh

Pre

Pen

Y Narasimha Rao

Steel Products

M. Bhoopal Reddy

Tubes

Shiva Kumar K

Industrial

Components

Business Heads



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Share Price Performance for Q2FY15


50

100

150

200

250

300

Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-1

Pennar Sensex BSE Small Cap


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Investor Contacts


Contact Details:


Floor: 3, DHFLVC Silicon Towers

Kondapur, Hyderabad - 500 084, Andhra Pradesh

Investor Relations - [email protected]
mailto:[email protected]:[email protected]

pennar industries q2fy15 investor presentation

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