INVESTOR PRESENTATION HINDCON CHEMICALS LIMITED HEM SECURITIES LTD. - PowerPoint PPT Presentation

INVESTOR PRESENTATION HINDCON CHEMICALS LIMITED HEM SECURITIES LTD. 1 AWARD WINNING MERCHANT BANKER

COMPANY OVERVIEW 2 Company Name Hindcon Chemicals Limited Date of Incorporation August, 25 1998 Registered Office Kolkata, West Bengal Exchange NSE – EMERGE Factory Howrah, West Bengal Industry Chemicals Incorporated on August 25, 1998 and since then company is engaged in manufacturing of chemicals • particularly for construction industry. They offer a wide range of chemical products which finds variety of applications in the construction sector. • In F.Y. 2016-17, their net revenue of operations comprised of Rs. 33.94 Crore of which 32.14% comprises of export sales to Nepal, Bhutan and Bangladesh. Company have developed a wide portfolio over 100 products which has made them one stop shop provider of • construction chemicals. Product portfolio includes Protective waterproofing coatings, Sodium Silicates, Concrete & mortar admixtures, Epoxy grouts & mortars, Waterproofing compounds, Shot crete aids, Remover cleaning compounds, Sealants, Tile adhesives etc. Company is also involved in a continuous process of modifying their products to eliminate any harmful • ingredient so as to serve the society with echo-friendly finished materials. As a result of these measures, Company will be able to increase its market share and profitability. Companies' manufacturing facility is located at Howrah, West Bengal which has an existing installed capacity • of 30,000 MT per year.

PROCESS FLOWCHART 3 Mixing Of Raw FURNACE Material SODIUM SILICATE GLASS PROCESSING LOADED IN DIGESTOR TANK WITH WATER FILTER TANK QUALITY CHECK PACKING DISPATCH TO CUSTOMER

OBJECTIVES OF THE ISSUE 4 OBJECTS AMOUNT ALLOCATED IN RS. For Meeting Working Capital Requirements 5.38 Cr For Meeting General Corporate Expense 1.60 Cr For Meeting Public Issue Expense 0.74 Cr Issue Proceeds 7.73 Cr

ISSUE HIGHLIGHTS 5 IPO DETAILS ISSUE OPENS 26 February 2018 Issue Size (No of Share) 27,60,000 ISSUE CLOSES 28 February 2018 Fresh Issue (No of Share) 27,60,000 LISTING ON NSE Emerge Issue Size In Rs 7.73 Cr LEAD MANAGER TO THE ISSUE Face Value Rs.10 Hem Securities Limited Issue Price Rs. 28 REGISTRAR TO THE ISSUE Post Issue No Of Share 1,02,38,125 Link Intime India Private Limited Post Issue Paid Up Capital 10.24Cr RESERVATION FOR NO OF SHARE Post Issue Implied Market 28.67 Cr Cap Market Maker 1,44,000 SHARE HOLDING PATTERN PRE IPO POST IPO RII 13,08,000 Promoter Holding 85.13% 62.18% Other Then RII 13,08,000 Public Holding 14.87% 37.82% NO OF SHARES BID LOT RII 4000 Pre Issue 74,78,125 Other Then RII 8000 & in multiples of 4000 Post Issue 1,02,38,125 thereof

PRODUCT PROFILE 6 Products Features They are used for plastering of walls, tanks, instant leak Water Proofing plugging, rapid hardening for basement and tunnels, stop Compounds running water from walls, dams etc. Concrete & This is used for concrete floor slabs, foundation, columns, Mortar beams, ceilings, shotcreting etc. Admixtures This is used for shutter release agents for steel & wooden framework before concreting for high strength concreting, to Concreting Aids prevent corrosion anodically as well as cathodically, for protection of reinforcement embedded in concrete. This is used as a binder in soap, as a paste in Card Board, as Sodium Silicate a quoting in electrodes have different uses in textile, Pharmaceuticals, Dams, Canals, Road, & Water Proofing.

PRODUCT PROFILE 7 Products Features The uses include prevention of corrosion of all types, to Protective & arrest seepage and dampness, waterproofing for roofs, Waterproofing gardens, pool, to provide coating for insulating solar heat, Coating / Sheeting used over concrete substrates as primer for waterproofing, long lasting protection of stone. This is used for injection into cracks in concrete to stop flow Grouts & of moving water and for filling up the wall and floor joints in Repairing Mortars residential and building structures. This products is used as accelerating admixture for dry Shot Crete Aids shotcreting. This is used for concreting floors, anti skid warehouse, Floor Toppings runway, heavy traffic areas, for coating before applying high build epoxy coating on steel & concrete surfaces.

PRODUCT PROFILE 8 Products Features This is used as sealants for fine cracks in structural Sealants membranes, tile joints, metal joints, holes, for sealing of vertical & horizontal expansion joints, They are used for permanent fixing of ceramic tiles/marble, vitreous, semi-vitreous tile, porcelain, glass mosaic tiles, Tile Adhesives precast terrazzo, engineered stone and natural stones over concrete. They are used for pressure injections into concrete, as primer on cement, stone, concrete, fixing insert plates, Epoxy Grout & foundation bolts, tie bars, food processing plants, interior mortar verticals. This product is used for concrete admixtures, pesticides, Foundry Aid foundries, leather tanning, drilling fluid and mud and paper cutting chemicals.

PRODUCT PROFILE 9 Products Features Coating/ This product is used to get exposed aggregate finish on Impregnation concrete face. Remover / This is used to remove rust from steel reinforcement, and Cleaning other steel section embedded in concrete. Compounds Expansion & They are used in construction and cold joints, water Contraction Joint retaining structures, water retaining structures, tunnel, System sewage treatment plant.

CLIENTELE STRENGTH 10

STRONG MANAGEMENT TEAM 11 Mr. Sanjay Goenka, Managing Director, Promoter He has over 25 years of experience in the business of construction chemicals and • cement additives. • He had been awarded with “National Award – 2010 ” in the year 2011 from Ministry of Micro, Small & Medium Enterprises for Outstanding Entrepreneurship. He has played a pivotal role in setting up of business of Company and is responsible • for the overall management and expansion of Company. Mrs. Nilima Goenka, Executive Director, Promoter She has over 20 years of experience in Administration and Human Resource • Management. • She is entrusted with the responsibility to oversee administration and Human Resource function in the Company.

INDUSTRY OUTLOOK 12 Construction industry in India is growing in excess of 16% p.a. and is likely to reach $ 100 billion by the • end of the XIIth Five Year Plan period. • The construction chemical industry in India accounts for only 0.4% of the total construction spend and has a potential of reaching 1% which is the norm in developed economies. The key products for this sector would be in the areas of painting and coating materials, reinforcing • fibers, admixtures and other construction chemicals. • The key success factor for construction chemical industry would be developing products and adopting advanced coating, ceiling and reinforcing material like polyurethane base coating, silicone base and polymer base re-enforcing material. • Compared to the developed world (The US, Europe) or China, the current penetration of specialty chemicals within India’s end markets is low. With an increased focus on improving products, usage intensity of specialty chemicals within these end markets will rise in India over the next decade. Government target to increase the share of manufacturing in GDP to at least 25% by 2025 (from current • 16%). Investments in manufacturing in the chemical sector are absolutely essential to ensure growth of the Indian chemical industry. Government's proposal to set up of a technology up-gradation fund of ~USD 80 Mn in the 12th plan for chemicals.

COMPETITORS ANALYSIS 13 290 260 230 200 170 140 110 80 50 20 -10 Face Value EPS PE RONW (%) NAV Per Share Pidilite Industries Limited 1 17.07 51.85 24.80 75.95 BASF India Limited 10 51.53 41.11 -1.11 294.48 Hindcon Chemicals Limited 10 5.46 6.55 13.76 176.63

REVENUE STATEMENT 14 Amount In (Rs. Cr) As At Particulars 30-09-2017 31-3-2017 31-3-2016 31-3-2015 31-3-2014 17.27 33.94 33.36 34.91 Revenue 30.89 Expenditure 14.76 30.38 31.25 33.44 29.67 2.51 3.56 2.11 1.46 Operating Profit 1.22 14.53 10.50 6.32 4.19 Operating Profit Margin % 3.95 Other Income 0.86 0.31 0.10 0.06 0.09 0.07 0.18 0.21 0.27 Depreciation 0.14 EBIT 3.30 3.69 1.99 1.26 1.17 0.35 0.61 0.68 0.75 Interest 0.65 PBT 2.94 3.07 1.31 0.51 0.52 Tax 0.75 1.02 0.44 0.16 0.16 2.19 PAT 2.06 0.86 0.34 0.36 NPM % 12.67 6.07 2.58 0.99 1.17