DFM FOODS LIMITED Investor Presentation PRIVATE & CONFIDENTIAL. - PDF document

DFM FOODS LIMITED Investor Presentation PRIVATE & CONFIDENTIAL.

Safe Harbor Statement This Release / Communication, except for the historical information, may contain statements, including the words or phrases such as ‘expects, anticipates, intends, will, would, undertakes, aims, estimates, contemplates, seeks to, objective, goal, projects, should’ and similar expressions or variations of these expressions or negatives of these terms indicating future performance or results, financial or otherwise, which are forward looking statements. These forward looking statements are based on certain expectations, assumptions, anticipated developments and other factors which are not limited to, risk and uncertainties regarding fluctuations in earnings, market growth, intense competition and the pricing environment in the market, consumption level, ability to maintain and manage key customer relationship and supply chain sources and those factors which may affect our ability to implement business strategies successfully, namely changes in regulatory environments, political instability, change in international oil prices and input costs and new or changed priorities of the trade. The Company, therefore, cannot guarantee that the forward looking statements made herein shall be realized. The Company, based on changes as stated above, may alter, amend, modify or make necessary corrective changes in any manner to any such forward looking statement contained herein or make written or oral forward looking statements as may be required from time to time on the basis of subsequent developments and events. The Company does not undertake any obligation to update forward looking statements that may be made from time to time by or on behalf of the Company to reflect the events or circumstances after the date hereof. 2 PRIVATE & CONFIDENTIAL.

Overview Introduction Key Financials  Founded in 1983 and headquartered in New Delhi, DFM Foods Ltd Y/E Mar 31, INR mn FY15 FY16 FY17 9MFY18 (“ DFM Foods”) engages in manufacturing and marketing of packaged snack foods in India Net Sales 2,893 3,895 3,421 3,245  Products sold under the brand name of “CRAX”, “CURLS “ and “ NATKHAT ” which are very popular among children. Growth (%) 9.9% 34.7% (12.2%) 30.0%  Promoted by Delhi Flour Mills Ltd and Jain Family, DFM Foods is a public listed EBITDA 329 487 374 404 company on the Bombay Stock Exchange and on the National Stock Exchange  Products manufactured include: EBITDA Margin (%) 11.4% 12.5% 10.9% 12.5%  CRAX – CORN RINGS PAT 110 250 183 174  CRAX CURLS – CORN PUFFS PAT Margin (%) 3.8% 6.4% 5.3% 5.4%  CRAX CHEESE BALLS Note: FY17 onwards figures are as per Ind - AS.  NATKHAT – WHEAT PUFFS Growth % for 9M FY18 compared with PY 9M  CRAX – NAMKEENS Shareholding Pattern (Dec-17)  2 state-of-the-art manufacturing facilities in Ghaziabad and Greater Noida with Others production capacity of 35,000 MTPA of snack foods in FY17 5.5% More than 1% %  Continuously investing in brand building and marketing activities with a special Public Shareholders Holding focus on channels aimed at children; on-the-ground-presence, and in-pack gifts that underline the fun element of product Individuals Promoter Westbridge Group 24.90% 38.3% 27.7%  Sharp focus on delivering quality products to customers through sourcing quality Man Mohan Singh 9.56% ingredients using best in class equipment and employing the right set of personnel.  Believe in constant innovation and product development in order to maximize value Mirae MF 3.66% for all its stakeholders Mirae MF 3.7% Anuradha Sharma 3.19%  Launched two new products in the current financial year – Crax Curls & Crax Cheese Balls Westbridge 24.9% 3 PRIVATE & CONFIDENTIAL.

Our Vision and Mission Our Vision “ “ To become one of India’s leading snack food providers, with a range of exciting, innovative products and a responsive distribution network spanning the breadth and depth of the country Our Mission “ To bring about excitement in people’s lives through our innovative, high quality snacks and brands, “ that inspire fun, joy and happiness! In doing so, we strive to maximize value for all our stakeholders, while maintaining the highest standards of honesty and integrity 4 PRIVATE & CONFIDENTIAL.

Our Strengths 1 Strong lineage 2 Strong brand equity among Target Group (TG) 3 Differentiated product offering Strengths 4 Extensive distribution network 5 State of the art manufacturing facility 6 Strong leadership and senior management team 5 PRIVATE & CONFIDENTIAL.

Our Growth Drivers   Strong media presence especially on TV so as to reach new consumers as well as maintain top of mind position among existing consumers Innovative and  Continuous use of innovative Consumer promotions in the form of gift-in-pack Aggressive Marketing  Use of BTL activities such as School Contact Programmes, on-ground activations etc. to increase engagement with our TG  The above shall help drive growth by market share gain as well as create the necessary consumer pull required for distribution expansion  New Products  New and exciting flavours among existing products  Completely new and differentiated Product offerings in the snacking space   Increase both numeric and weighted distribution in existing towns Distribution Expansion  Penetrate deep into smaller / lower pop-strata towns and villages  Expansion to uncovered markets in the new zones  Distribution expansion to modern retail formats and institutions 6 PRIVATE & CONFIDENTIAL.

Products Snapshot CURLS CRAX CURLS NATKHAT CORN RINGS NAMKEENS WHEAT PUFFS CHEESE BALLS CURLS Variants – 11 variants of both Target Audience – Children Target Audience - 6-12 year Target Audience - 6-14 year Target Audience - 6-14 year Ingredients – Corn based Ingredients - Corn based extruded popular and unique & Young Adults Ingredients - Extruded wheat snack Namkeens such as Mast extruded snack Ingredients - Corn based puff Price Point – Rs. 5, Price Point – Rs. 5, Price Points - Rs. 5, 15 grams and Matar, Kaju Mixture, extruded snack Price Point – Rs. 5, 24 gms Rs. 10, 35 grams Navratan, Aloo Bhujia etc. 21 grams 25 grams, Rs 2, 11 grams Flavors – Chatpata, Tangy Flavors – Masala, Tomato Flavors – Classic, Masala Price Points - Rs. 5, 10, 20 Tomato, Masala Mania, Pudina Punch, Mast Cheez & Thai Sweet Chilli 7 PRIVATE & CONFIDENTIAL.

Geographical Presence & Capacity Creation Territorial Expansion – Timeline India Distribution Footprint Madhya Pradesh, Rajasthan FY10 Himachal Pradesh FY11 Chhattisgarh, Maharashtra, Gujarat; Commissioning of Greater Noida facility FY12 West Bengal FY13 Bihar, Jharkhand, Orissa, Goa FY14 Bangalore (Karnataka), Hyderabad (Telangana), Chennai (Tamil Nadu); Brownfield expansion commissioned in Dec-15 in Greater FY16 Noida Unit Second brown field expansion commissioned in Mar-17 in Greater Noida FY17 Land in Pune acquired for setting up a manufacturing facility to cater to Western, Central and Southern zones FY17 8 PRIVATE & CONFIDENTIAL.

The Distribution Model Formal Distribution Channel DFM Foods C&F Distributors Retail Outlets Super Stockist Wholesalers Informal distribution model covering regions beyond the formal reach through wholesalers and smaller Sub- Stockists retailers Small Retail Outlets Retail Outlets /Wholesalers Robust Distribution Network with direct distribution to over 3 Lacs retail outlets in 1 lakh plus population towns and wide distribution network with +40 C&F Agents and +1400 Distributors: To penetrate smaller markets 140+ Super Stockists & 1800 + Sub-Stockists 9 PRIVATE & CONFIDENTIAL.

Last 10 years share price performance (Apr-08 to Mar-18) 2500 2000 1500 1000 500 0 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18  CAGR of ~24% since listing in Apr-95 to Mar-18*  CAGR of ~55% since last 5 years from Mar-13 to Mar-18* *The data is up to 14-Mar-18 Source: BSE 10 PRIVATE & CONFIDENTIAL.

Financial Snapshot Net Sales (INR mn) RoE and ROCE (%) 45.0% 3,895 3,421 3,245 38.0% 45.0% 2,893 2,633 31.0% 29.0% 25.0% 26.0% 26.0% 24.0% 20.0% FY14 FY15 FY16 FY17 9MFY18 FY14 FY15 FY16 FY17 9MFY18 * 9M FY 18 are annualized ROCE (%) RoE (%) Profit after Tax (INR mn and %) EBITDA (INR mn and %) 6.4% 12.5% 12.5% 11.4% 5.4% 10.1% 10.9% 5.3% 3.8% 2.7% 71 110 250 183 174 265 329 487 374 404 FY14 FY15 FY16 FY17 9MFY18 FY14 FY15 FY16 FY17 9MFY18 PAT PAT Margin (%) EBITDA EBITDA Margin (%) Note: FY17 onwards figures are as per Ind-AS. 11 PRIVATE & CONFIDENTIAL.

12Q Revenues, EBITDA Margin, PAT Margin & Share Price Movement INR mn Net Sales EBITDA Margin (%) PAT Margin (%) 15.8% 13.7% 14.1% 12.8% 11.4% 10.6% 10.8% 9.5% 10.0% 9.0% 11.5% 9.0% 8.8% 6.8% 6.5% 6.1% 5.9% 6.3% 4.9% 4.7% 4.3% 3.3% 3.1% 2.8% 850 680 971 1,012 1,228 744 886 868 923 940 1,068 1,237 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16 Q1FY17 Q2FY17 Q3FY17 Q4FY17 Q1FY18 Q2FY18 Q3FY18 Note: FY17 onwards figures are as per Ind-AS 2,500 2,000 1,975 1,500 1,000 500 0 Source: BSE 12 PRIVATE & CONFIDENTIAL.