,40 01 " 111 " Pidilite 7 th June, 2019 The Secretary The Secretary BSE Ltd. National Stock Exchange of India Ltd. Corporate Relationship Dept.. Exchange Plaza, Plot no. C/1, G Block, Bandra-Kurla Complex, 14 th floor. P. J. Tower, Dalal Street, Fort Bandra (E). Mumbai - 400 051 Mumbai - 400 001 Stock Code - PIDILITIND Stock Code — 500331 Sub: Investor Presentation Dear Sir. Please find attached Investor Presentation. Thanking You, Yours faithfully, For Pidilite Industries Limited Puneet Bansal Company Secretary Encl: as above Pidilite Industries Limited Corporate Office Ramkrishna Mandir Road Andheri - E, Mumbai 400059, India Rev]. Office T + 91 22 2835 7000 Regent Chambers, 7th Floor 2835 7952 / 2835 7365 Jamnalal Bajaj Marg F + 91 22 2830 4482 208 Nariman Point www.pidilite.com Mumbai 400 021 CIN:L24100MH1969PLC014336
Investor Presentation
Disclaimer This presentation may contain statements which reflect the management’s current views and estimates and could be construed as forward looking statements. The future involves certain risks and uncertainties that could cause actual results to differ materially from the current views being expressed. Potential risks and uncertainties include such factors as general economic conditions, foreign exchange fluctuations, competitive product and pricing pressures and regulatory developments.
Agenda • Company Overview • Business Overview • Macro Indicators • Strategic Direction • Key Consideration
Company Overview Since 1959 No. 1 Adhesives >5300 permanent Operations in India’s Super 50 company in India employees 9 countries Company 23 Mfg. Plants & >500 Exporting to 19 International & 3 R&D 23 Co Makers in India Products >80 countries 9 Domestic Subsidiaries Centers >INR 60,000 Crore 10 Year Net 10 Year EBITDA Rs. 19.3 EPS for 10 Years Market Market Cap Sales CAGR 13% CAGR 20% the FY 2018-19 Cap CAGR 40%
Sustainable Strong Growth … Net Sales Growth Trend Over Last 10 Years EBITDA Growth Trend Over Last 10 Years 80,000 16,000 28% 70,348 13,762 26% 14,000 70,000 24% 12,000 60,000 22% 10,000 50,000 20% 42,606 20% 8,000 6,770 40,000 18% 6,000 16% 16% 30,000 4,000 19,863 14% 2,286 20,000 2,000 12% 12% 10,000 - 10% 2008-09 2013-14 2018-19 - 2008-09 2013-14 2018-19 Consolidated EBITDA (Rs Millions)** Consolidated Net Sales (Rs Millions)* EBITDA as a % to Net Sales *Sales net of excise duty **EBITDA before Non Operating Income
FY 19 Net Sales & EBITDA 80,000 15,000 75,000 70,348 14,000 13,762 70,000 13,449 65,000 13,000 60,324 60,000 12,000 55,000 50,000 11,000 FY 2017-18 FY 2018-19 FY 2017-18 FY 2018-19 Consolidated Net Sales (Rs Millions)** Consolidated EBITDA (Rs Millions)* *EBITDA before Non Operating Income **Sales net of excise duty On a comparable basis after reflecting accounting impact of Margins have been impacted by high input costs and a GST, net sales grew by 17.5% (excluding sales of Cyclo weaker rupee. While pricing actions have been taken, the division of Pidilite USA Inc., which was sold by Pidilite USA input costs and the exchange rate have both now eased Inc. in June 2017). from their peak.
Creating Values for Shareholders 7,00,000 4,500 44.0 6,31,087 3,980 6,00,000 4,000 42.0 3,667 5,00,000 40.6 3,500 40.0 2,931 3,000 4,00,000 38.4 2,561 38.0 2,500 3,00,000 36.0 2,000 1,789 2,00,000 1,56,561 34.4 34.0 33.8 1,500 33.1 1,00,000 1,000 32.0 21,374 FY15 FY16 FY17 FY18 FY19 - Dividend Payout (Rs Millions) 2008-09 2013-14 2018-19 % to Net Profit Market Cap (Rs Millions) (excluding exceptional items) Market Cap growing @ 40% CAGR / Steady dividend payout
Agenda • Company Overview • Business Overview • Macro Indicators • Strategic Direction • Key Consideration
Our Businesses Consumer & Bazaar Consumer Products – Woodworking, Maintenance and Arts, Construction Chemicals Wall and Wood Stationery, Fabric Finishes Industrial Business
Our Businesses: Revenue Split Pigments & Preparations {6%} Industrial Resins etc. {5%} Others {1%} Industrial Adhesives {4%} Art & Craft Materials etc. {8%} IP 15% C&B 84% Adhesives & Sealants {56%} Construction& Paint Chemicals {20%} C&B – Consumer & Bazaar, IP – Industrial Products Standalone Results – % of Total Sales for 2018-19
C&B Businesses 84% Strong Brands Of Company’s Revenue Adhesives & Sealants : 56% Paint Chemicals : 20% Art & Craft Materials etc. : 8% Extensive Distribution Market Leader in all segments of adhesives and Direct Coverage : 1.5 Lacs + Dealers sealants, construction chemicals In-direct Coverage : 50 Lacs + Dealers (retail segment) and hobby colors
Industrial Businesses 15% Industrial Products: - Specialty polymers and co-polymers Of Company’s Revenue - Hot melt adhesives Industrial Adhesives : 4% Industrial Resins etc. : 5% - Adhesives for Footwear, Leather Pigments & Preparations : 6% - Organic & high-performance Pigments - Epoxy & Cyanoacrylates for Automotive assembly Market Leader in pigment dispersions for Indian textile segments Pioneer in manufacturing Pigment Violet 23 in India
Global Footprint INR 6,068 mn International manufacturing activities in: - USA Export Revenue FY’19 - Brazil - Thailand - Bangladesh Export to.. - Egypt 80+ Countries - Dubai - Sri Lanka - Singapore 19 Specific focus on growing business in Bangladesh and Sri Lanka Overseas Subsidiaries 6 direct, 13 step down New manufacturing facilities planned in Ethiopia Total Revenue from Overseas An additional manufacturing facility planned in Bangladesh subsidiaries of Rs. 5,233 mn in FY’19 is expected to commence production in Q2 FY’19
Global Footprint : Int’l Subsidiaries North America SAARC / SEA • Sargent Arts is a leading supplier of quality art materials • Bangladesh : No. 1 player manufacturing adhesives, to the educational and retail markets throughout the sealants. Growing & profitable business, and in the United States. process of expanding manufacturing capacity. • Sri-Lanka : Acquired from CIC Holdings PLC, Chemifix trademark and other brands associated with PVAC • Adult colouring segment has seen slow-down in current adhesives business in 2015. Year. • SEA : Construction chemical subsidiary in Thailand. South America MEA • Egypt : Manufactures & sells adhesives, sealants & other • The business manufactures and sells Adhesives, Sealants products. Decline in sales growth due to market and Construction Chemicals. conditions. • Dubai : Modern purpose built factory at Dubai • Has been facing competitive pressure in key products. Investment Park II. The facility manufactures and supports a range of construction chemicals. • Africa has numerous similarities with India - trade (small • Focus on new and fast moving products for improving retail setups), application (No DIY concept). Most of the margin. dealers in Africa are of Indian origin.
We continue to deliver value through high quality customer connect.
Regular Recognition
Agenda • Company Overview • Business Overview • Macro Indicators • Strategic Direction • Key Consideration
Macro indicators provide strong impetus.. GDP GROWTH STORY INTACT BY 2030, 40% OF INDIA WILL LIVE IN CITIES 590 Urban Population (M) 600 GDP Growth (%) 500 9.0% 8.2% 340 400 7.7% 8.0% 290 7.1% 7.0% 300 220 6.6% 7.0% 6.3% 200 5.8% 5.6% 6.0% 100 5.0% 0 1991 2001 2008 2030 Q1 FY Q2 FY Q3 FY Q4 FY Q1 FY Q2 FY Q3 FY Q4 FY Urbanization 17-18 17-18 17-18 17-18 18-19 18-19 18-19 18-19 26% 28% 30% 40% Rate Source : Reserve bank of India (www.rbi.org.in) ……OPPORTUNITY IN TIER 2 & TIER 3 STATES …AND IN ASPIRERS/BOTP CONSUMER SEGMENTS Note: Urban (GOI definition): 4,000 People/75% of men in non agricultural work/Population density of 400 per sqkm Source: MGI, Secondary Research, Monitor Analysis
Agenda • Company Overview • Business Overview • Macro Indicators • Strategic Direction • Key Consideration
How we view our portfolio
How we grow our core at 1-2X of GDP 1. DRIVE PENETRATION CORE 2. INNOVATE 3. PREMIUMIZE
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How we grow our core at 1-2X of GDP 2. INNOVATE Ease of Reach Use Odd Case Study: Fevicol Ezeespray Spaces Last Minute Finishing Fast Grab & Rapid Bonding Excellent Heat Resistance Application Control
How we grow our core at 1-2X of GDP 3. PREMIUMIZE Case Study: Evolution of Fevicol
How growth businesses grow at 2-4X of GDP GROWTH 1. CREATE CATEGORIES CORE 2. WHOLISTIC BRAND MANAGEMENT
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