July 31, 2020 The General Manager The Manager, Listing Department - - PDF document

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July 31, 2020 The General Manager The Manager, Listing Department - - PDF document

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July 31, 2020 The General Manager The Manager, Listing Department Corporate Relations Department National Stock Exchange of India Ltd Exchange Plaza, 5 th Floor, Plot No. BSE Limited Phiroze Jeejeebhoy Towers G Block, Bandra-Kurla Complex

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July 31, 2020 The General Manager Corporate Relations Department BSE Limited Phiroze Jeejeebhoy Towers Dalal Street Mumbai 400 001 Scrip Code: 500770 The Manager, Listing Department National Stock Exchange of India Ltd Exchange Plaza, 5th Floor, Plot No. G Block, Bandra-Kurla Complex Bandra (E) Mumbai 400 051 Symbol: TATACHEM Dear Sir/Madam, Sub: Submission of Analysts/Investors Presentation Ref: Letter dated July 20, 2020 informing about Analysts/Investors Presentation Further to our referred letter dated July 20, 2020, please find enclosed a presentation to be made to analysts/investors on the results for the first quarter ended June 30, 2020 for the analysts/investors call to be held on Monday, August 3, 2020. The presentation is being submitted in compliance with Regulation 30(6) read with Schedule III Part A Para A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. A copy

  • f

the presentation is also uploaded

  • n

the Company's website www.tatachemicals.com. You are requested to take the same on record. Thanking you, Yours faithfully, For Tata Chemicals Limited Rajiv Chandan General Counsel & Company Secretary Encl: As above

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Analyst and Shareholders Communication

31 July 2020

Q1 FY20-21 Financial Results

1

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SLIDE 3

❷ Our Focus Areas ❸ Performance Highlights ❹ Financial Performance ❶ Soda Ash Market Overview

Manufacturing Footprint across 4 Continents Employing ~5,000 people With 13 Manufacturing plants Supported by 3 R&D centers with 200 + experts

2

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SLIDE 4

Soda Ash: Global Demand situation

19.8 16.3 14.9 14.5 6.8 7.0 20.4 20.3 Global Demand 2019 Global Demand 2020 Flat Glass Container & Other Glass Soaps & Detergents Other Chemicals

(Down 3.8 MMT vs 2019)

Total 61.9 MMT Total 58.1 MMT

  • Capacity is estimated to be operating at ~80% vs. historic of

~86%; Demand reduction of 6% vs 2019

  • Reduction in demand from Flat Glass Industry is estimated

to be ~18%

  • Soaps & Detergents less impacted with estimated growth of

~3%

  • Solar Glass in Asia continues to grow
  • Container glass and Other glass is down by 3% but

recovering

  • Spot prices already seeing a decline, contract prices may

follow soon Market Size shrinks; Led by Flat Glass Industry

↓ ↓ ↑ ↓

Source: Internal Estimates

3

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SLIDE 5

Business Units Key Highlights TCL Split between Domestic & Exports Vols. (In Kts) Impact on TCL Performance

India

  • Demand is returning, but growth subdued
  • Flat Glass industry tend to de grow, it’s operations started after 3 months
  • f Lockdown
  • Good demand from Soaps and Detergents industry
  • Container glass fared better than flat glass but still with negative growth

Volumes ↓ ~27%

US

  • Domestic Flat Glass demand drop by 20%
  • Export demand significantly low driven by Flat glass line closures
  • Container glass demand in export markets also soft
  • Domestic Container Glass demand less impacted

Domestic Volume ↓~13% Export Volume ↓~45%

UK

  • Container Glass demand remained relatively stable; minor impact on

account of closure of hospitality sector

  • Detergent and Bicarb demand grew
  • Flat glass lines closed; TCE has negligible sales into that sector

Volumes ↓~9%

Africa

  • Container Glass demand remained relatively stable

Domestic Volume ↓~6% Export Volume ↓~10%

Soda Ash: Demand and Supply

163 118 Q1 FY20 Q1 FY21 251 138 288 250 Q1 FY20 Q1 FY21 68 62 Q1 FY20 Q1 FY21 45 41 18 17 Q1 FY20 Q1 FY21

` Exports Domestic

Steep fall in US Export, other regions see muted demand

4

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SLIDE 6

Focus Area: Long Term Priority

Tata Chemicals Limited

Mission : Serving Society through Science

Vision: Will be a leading sustainable Science led Company serving customers based on innovative differentiated products and solutions

Technology (R&D) Ӏ Digitization Ӏ Sustainability

Performance Materials Nutritional Science

Unified Approach, Underpinned by Science and Rooted in R&D Over Values : SPICE {Safety Ӏ Passion Ӏ Integrity Ӏ Care Ӏ Excellence}

Agro Science Energy Science 5

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SLIDE 7

Investment Alignment with Strategy

6

Higher Growth Products Stable Growth Product IVSD Bicarb

Soda Ash

Agro Sciences

Caustic

Cement

Mar20 Mar21 Mar22 Mar23 Delay in Months No Change No Change No Change Upto 9 months Upto 12 month Upto 12 month

Investment continues as planned Investment under watch

We continue to invest in our expansion projects, with more diligence and caution

Extended period

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Performance Highlights

Soda Ash Volumes Q1 FY 21 624 Kts Q1 FY 20 833 Kts

Revenue

CY INR 2,348 Cr

IVSD Salt Volumes Q1 FY 21 298 Kts Q1 FY 20 237 Kts Consolidated Net Debt June 20 INR 3,760 Crs Mar 20 INR 4,042 Crs Completed refinancing of loan in US for USD 375 million Highest ever production and sale of IVSD salt Standalone continues to be Debt Free

EBITDA

CY INR 360 Cr ↓ 9% vs PY

Margin 15% ↓ 460 bps vs PY 7

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SLIDE 9

Financial Performance : For the quarter ended June 2020

Standalone | ₹ Crore Consolidated | ₹ Crore

Revenue down by ₹ 91 Crore (↓13 %) EBITDA down by ₹ 34 Crore (↓18 %) PAT down by ₹ 97 Crore (↓47%) Revenue down by ₹ 236 Crore (↓9 %) EBITDA down by ₹ 155 Crore (↓30 %) PAT down by ₹ 157 Crore (↓68%) Note: * PBT & PAT includes Continuing operations, after Share in JV & associates & before NCI

8

719 628

300 350 400 450 500 550 600 650 700 750

Q1 Jun19 Q1 Jun20 189 156 26% 25%

  • 10%
  • 5%
0% 5% 10% 15% 20% 25% 30%
  • 50
100 150 200 250

Q1 Jun19 Q1 Jun20

206 109 29% 17%

  • 50%
  • 40%
  • 30%
  • 20%
  • 10%
0% 10% 20% 30% 40%
  • 50
100 150 200 250

Q1 Jun19 Q1 Jun20

2,584 2,348

  • 500
1,000 1,500 2,000 2,500 3,000

Q1 Jun19 Q1 Jun20 515 360 20% 15%

0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20%
  • 100
200 300 400 500 600 700 800

Q1 Jun19 Q1 Jun20

231 74 9% 3%

  • 50%
  • 40%
  • 30%
  • 20%
  • 10%
0% 10% 20% 30%
  • 100
200 300 400 500 600 700 800

Q1 Jun19 Q1 Jun20 PBT down by ₹ 149 Crore (↓51 %) PBT down by ₹ 232 Crore (↓68% %)

255 51 87 59 Q1 Jun19 Q1 Jun20

Operational PBT Non Operational PBT

133 103 159 39

  • 50
100 150 200 250

Q1 Jun19 Q1 Jun20

Operational PBT Non Operational PBT

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SLIDE 10

Financial Performance : Segment Revenues and Results

9

₹ Crore Consolidated Standalone Q1 Jun19 Q1 Jun20 Variance Q1 Jun19 Q1 Jun20 Variance Basic Chemistry Products 1,949 1,672 (277) 708 612 (96) Specialty Products 634 676 42 11 16 5 Less: Inter Segment Revenue (3) (3) (0)

  • 2,580

2,345 (235) 719 628 (91) Unallocated Revenue 4 3 (1)

  • Total Segment Revenue

2,584 2,348 (236) 719 628 (91) Basic Chemistry Products 318 112 (207) 204 159 (45) Specialty Products 76 93 18 (5) (15) (10) Segment Results 394 205 (189) 200 144 (56) Unallocated Expenses / (Income) (45) (23) 22 (112) (3) 109 Finance Costs 94 118 24 20 4 (15) Profit after exceptional items, before share of profit of joint ventures and tax 345 111 (234) 292 142 (149)

Segment Revenue

Segment Results

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SLIDE 11

2,584 2,348 96 5 226 9 26 36 62

2,000 2,100 2,200 2,300 2,400 2,500 2,600

Q1 June FY20 BCP India SP India TCNA TCE Magadi Rallis SPV & Elim Q1 June FY21

Financial Performance : Revenue Movement

Revenue Movement | ₹ Crore

→ On consolidated financials impact on Revenue from Operation is majorly driven by US

  • perations.

→ Export sales volumes in US operations is impacted (↓ 45% vs PY) partially due to COVID lockdown. → Domestic market in US maintained it’s resistance. 10

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Financial Performance : PBT Movement

PBT Standalone Movement | ₹ Crore PBT Consolidated movement | ₹ Crore → Standalone Other Income Breakup: → Other Income of ₹ 39 Crs in Q1 FY21 vs ₹ 159 Cr PY is due to NIL dividend from JV vs ₹ 72 Cr PY and Rallis dividend NIL vs ₹ 25 Cr PY, which was received in Q1 last year. → Consolidated Other Income Breakup:

292 133 159 52 23 104

  • 50
100 150 200 250 300 350

PBT Q1 FY20 Reported Other Income PBT Q1 FY20 - Core Net Production Cost Fixed & Other Exoenditure PBT Q1 FY21 - Core 342 255 87 225 21 51

  • 50
100 150 200 250 300 350

PBT Q1 FY20 Reported Other Income PBT Q1 FY20 - Core Net Production Cost Fixed & Other Exoenditure PBT Q1 FY21 - Core

Standalone Q1 FY20 Q1 FY21 Dividend Income from JV 72

  • Dividend Income from Subsidiaries

26

  • Interest & Miscellaneous Income

60 39 159 39 Consolidated Q1 FY20 Q1 FY21 Interest Income 19 12 Dividend & Miscellaneous Income 68 47 87 59

11

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SLIDE 13
  • Refinancing of debt in US for USD 375 million completed
  • Partial repayment of Borrowing in US, UK, Rallis and SPV out of internal accruals
  • Consolidated Cash and Cash Equivalent as on 30th June 2020 is ₹ 3,258 Cr (vs ₹ 3,660 Cr as on Mar20)
  • Standalone continues to be Debt Free
  • Standalone Cash and Cash Equivalent as on 30th June 2020 is ₹ 1,999 Cr (vs ₹ 2,162 Cr as on Mar20)

Financial Performance : Borrowing Position as on June 2020

12

Consolidated Debt Position | ₹ Crore

Details

7,702 7,018 3,760 589 95 3,258 Gross Debt Mar20 Net Change Revaluation Gross Debt Jun20 Cash & Cash Equivalents Net Debt

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SLIDE 14

Segment Revenue at ₹ 1,672 Cr (down by 14%) Segment Results at ₹ 112 Cr (down by 65%)

Financial Performance: Basic Chemistry Products

Key Highlights India Operations

  • Revenue at ₹ 612 Cr (down by 14%), operating margins were subdued at ₹ 159 Cr (26%),

down from ₹ 204 Cr (29%) vs PY.

  • Overall impact in India operations due to the following:
  • Lower volumes & realizations in Soda Ash, Bicarb and Cement.
  • Higher volumes and realization in IVSD Salt

US Operations

  • Revenue stood at ₹ 619 Cr (down by 27%)
  • US Domestic market (in volumes) remained resilient in the lockdown.
  • Due to partial operations at destination ports , export volumes were down by 45%.
  • CY PBT also had a one time cost of ₹ 38 Cr towards refinancing of US borrowings

UK Operations

  • Revenue at ₹ 316 Cr (up by 3%) and EBITDA was at ₹ 28 Cr (up by 56%)
  • Margins improved due to higher sales realization partly offset by lower sales volume in

Soda ash and Salt. Kenya Operations

  • Revenue at ₹ 100 Cr (down by 20%) and EBITDA stood at ₹ 10 Cr (down by 50%) due to

lower sales volume & lower sales realization. 1,949 1,672 318 112

  • 100
200 300 400 500 600 700 800 900 1,000
  • 500
1,000 1,500 2,000 2,500 3,000

Q1 Jun19 Q1 Jun20 Segment Revenue Segment Results

13

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SLIDE 15

Segment Revenue at ₹ 676 Cr (up by 7%) Segment Results at ₹ 93 Cr (up by 24%)

Financial Performance : Specialty Products

Key Highlights Specialty Products

  • Specialty products business had a challenging first quarter for the year FY21. Overall

Revenue increased to ₹ 16 Cr (up by 48%), on the back of increasing volumes. Nutritional Science

  • Nutritional Solutions business witnessed a lower demand off-take, yet received good

traction from health focused companies Silica Business

  • Silica Business had good demand in food & nonfood grade silica from essential goods

segments, though demand from tyre and automotive segment where muted. Agro Science (Rallis India Ltd)

  • Agro Science business had a decent performance, with Revenue at ₹ 659 Cr (up by 6%)
  • n the back of higher volume in major products.
  • Successful launch of 4 new hybrids in Maize, Bajra & Chilli.
  • Implementation of Capex program is on course, with some minor delay due to Covid

lockdown. 634 676 76 93

  • 20
40 60 80 100 120 140 160 180
  • 200
400 600 800 1,000 1,200 1,400 1,600 1,800 2,000

Q1 Jun19 Q1 Jun20 Segment Revenue Segment Results

14

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Financial Performance : Operating Entities

15

Statement of Profit and Loss (Continuing Operations) for the quarter ended June 2020

* Consolidated financials is after adjusting SPV & Other adjustments

  • PBT is after exceptional items & Share in JV and PAT (Before NCI)

Units TCL India US UK Africa Rallis Consolidated ₹ Crore PY CY PY CY PY CY PY CY PY CY PY CY Net Income 719 628 845 619 307 316 126 100 623 659 2,584 2,348 EBITDA 189 156 189 35 18 28 20 10 95 124 515 360 PBT 292 142 91 (119) (15) (15) 9 (2) 87 120 342 110 PAT 206 109 47 (107) (15) (15) 9 (2) 68 92 231 74

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Financial Performance : Major Products

Soda Ash | In Kts Sodium Bicarbonate | in Kts Edible Salt* | in Kts

For the Quarter

163 118 193 117 539 387 549 372 68 62 76 79 63 57 79 57 Jun-19 Jun-20 Jun-19 Jun-20 Sales Production TCL India TCNA TCE TCM

* Clarification on COVID update on 6th July:

  • Post the demerger of Consumer Products Business, Salt volumes represents IVSD salt sales to TCPL.
  • Salt Volumes higher by 26% in Q1 CY vs. PY & overall Net Revenue (revenue net of logistics and certain other costs) increased by 40% vs PY

27 21 27 18 24 30 24 30 Jun-19 Jun-20 Jun-19 Jun-20 Sales Production TCL India TCE 237 298 244 309 Jun-19 Jun-20 Jun-19 Jun-20 Sales Production

16

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Exchange | Average rate per ₹

Financial Performance : Additional Information

17

Revenues | ₹ Crore & PAT | In % Earnings Price Per Share | In ₹ Shareholding Pattern | In %

Promoter & Promoter Group, 34.6% Institutions, 43.2% Non institution , 22.2%

2,584 2,771 2,623 2,378 2,348 9% 14% 8% 8% 3%

0% 5% 10% 15% 20% 25%
  • 500
1,000 1,500 2,000 2,500 3,000

Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q1 FY21 6.2 11.7 6.6 7.3 0.5

  • 2.0
4.0 6.0 8.0 10.0 12.0 14.0

Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q1 FY21 69.56 69.95 70.37 70.88 75.87 89.34 88.03 89.29 90.13 94.19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q1 FY21 USD GBP

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SLIDE 19

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