DB Investor Presentation March 2011 v1

7/31/2019 DB Investor Presentation March 2011 v1

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D ABUR INDIA LIMITED

March 2011, Mumbai

Deutsche Bank - Access India Conference

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FMCG GROWTH STORY

I nd ia FMCG Sec to r – Vo lume and Value Grow th Ra te (Y -o -Y % )

High Grow th Phase

Source: Industry data, Standard Chartered Research

9 India’s FMCG sector reported steady sales CAGR of 11.2% over FY00-10 on the

back of strong annual volume growth of ~8.5%.9 Growth being driven by increasing consumption led by rise in incomes, changing

lifestyles and favorable demographics

9 FMCG industry expected to grow in mid to high teens going ahead

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FMCG – CURRENT SCENARIO

FMCG Spl i t : OTC, Food an d N on -Food 9 FMCG industry pegged at US$30

9 Of the entire FMCG sector, Food is

52%, Non-Food at 45% and OTC 3%100,000

120,000

140,000

(11%)

(8%)

(14%)

10 %82,61597,276

116,053

128,580Rs. Crores

454

4

3

of total revenue

40,000

60,000

80,000OTC PRODUCTS

Non‐Food

Food Products

(14 %)

(19%)

(20 %)

(14 %)

48

46

46

5052

4

FMCG Sa les – Chann e l Breakdow n

Source: AC Nielsen

0

20,000

MAT Sep'07 MAT Sep'08 MAT Sep'09 MAT Sep''10

48 50

3.3%

5.0%

5.9%

9Of the 7.8 million retail outlets for

58.6%

13.2%

8.2%

.

format

9 Modern Trade contributes to 6%of FMCG sales

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3

Source : AC Nielsen

Paan Plus Food Stores Others

Modern Trade



FMCG INDUSTRY GROWTH DRIVERS

Shift from unorganised to

Rise in per capita category

Increase in penetration

•Evidenced by growth in

hair oils

• ‐

•Level of per capita

increase in consumption

in the future is a ke

•Category penetration

continues to be

abysmally low in various

categories like instant

organised presence is

a key driver for future

volume growth

variable

for

future

volume growth

•Demonstrated by recent

stron rowth in

branded foods, OTC, skin

creams, etc.

indicating

scope for volume

growth through increase

branded foodsn penetrat on

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4

Above d r i ve r s a ided by f avou r ab le demog raph i cs and r i se i n d i sposab le incom es



PENETRATION LEVELS: SUFFICIENT HEADROOM

80%80%

90%

Rural Penetration Urban Penetration

67%

57% 59%60%

70%

42%

37%

32%

40%

50%

18% 18%

4%

19%

5%

26%

10%

20%

Source: Industry Data

0%

Toothpaste Shampoo Hair Oil Skin Cream Mosquito

Repellants

Instant

Noodles

Hair Dyes Floor Cleaners

9 Low penetration levels offer room for growth across consumption categories9 Rural penetration catching up with urban penetration levels

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PER CAPITA CONSUMPTION: ROOM FOR GROWTH

Skin Care – Per Cap i ta Consum pt ion ( in US$) Sham poo – Pe r Cap i ta Consump t i on ( i n US$)

I n d i a h a s l o w p e r ca p i t a co n s u m p t i o n a s co m p a r e d t o o th e r e m e r g in g e co n o m ies

7.4 7.7

5

6

7

8

9 2.72.4

2

2.5

3

in US$ in US$

3.2

0.80.3

0

1

2

3

4 1.0 1.1

0.3

0

0.5

1

1.5

China Indonesia India Malaysia Thailand China Indonesia India Malaysia Thailand

Too thpas te – Pe r Cap i ta Consump t i on ( i n US$)

2.9

2.02

2.5

3

3.5in US$

0.5

1.0

0.4

0

0.5

1

1.5

6

6

Source: MOSL



DABUR OVERVIEW

9 Established in 1884 - more than 125 Yearsof Trust & Excellence

Ten B i l l i on Rupee Brands

9 World’s largest in Ayurveda and natural

healthcare. .

5 billion in FY2009-10

9 Strong brand equity

Dabur is a household brand

Vatika and Real are Superbrands

Hajmola , Real & Dabur ranked amongIndia’s Most Admired Brands

9 10 Brands with sales of over Rs. 1 billioneach

9 Wide distribution network covering 2.8

9 17 world class manufacturing plantscatering to needs of diverse markets

Dabur ranked200 in theFortune India500 list

Dabur movesup to take the78th spot in theSuper-100list, released by

Dabur ranked 45among MostTrusted Brands inIndia, according toBrand Trust

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contribution to consolidated sales

Business India Report, IndiaStudy, 2011



FINANCIAL PERFORMANCE

Sales

i n Rs . m i l l i on

10,997 12,004 12,849 12,356 14,170 17,565

20,80323,963

28,34134,167

15000

20000

25000

30000

35000

40000

0

5000

10000

FY01 FY02 FY03 FY04^ FY05 FY06* FY07 FY08 FY09 FY10**

22.0%

in %

EB I T D A M ar g i n ( i n % ) Net Pro f i t


2,1422,817

3,3293,913

5,032

3000

4000

5000

6000

13.3%

15.3%

17.1%18.1%18.5%18.3%

.

16.0%

18.0%

20.0%

1,065,

0

1000

2000

FY04 FY05 FY06 FY07 FY08 FY09 FY10

10.0%

12.0%

.

FY04 FY05 FY06 FY07 FY08 FY09 FY10

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^ Sales show a decline in FY04 on account of de- merger of Pharm a business * Balsara acquisition added 10% to t opline in FY06 * * Fem acquisition added 3.5% to t opline in FY10



PORTFOLIO

Hea l th

PersonalCare

Hom e Care

Foods

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GLOBAL FOOTPRINT

UK

Turkey

U.S.Egypt

UAENepa l

B’Desh

Niger ia

Domes t i c M fg .Loca t ions

Manufacturing Facilities

Key markets

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,a n d p r o d u ct o f f e r i n g s t o su i t co n su m e r r e q u i r e m e n t s

in each geog raphy



ROBUST DISTRIBUTION NETWORK

Factory

C&FA

(Carry & Forward Agents)

t oc st u p er t oc st I n s t i t u t i o n s& M od e r n

t r a d e

W h olesaler s Su b St ock ist

RETAI L TRADE

CONSUMERS

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D ir e ct + I n d i r e ct Re ach c o v e r i n g 3 m i l l io n R eta i l Ou t l e t s



PRESENCE IN FMCG CATEGORIES

Mark e t Sha rePosi t ion Key Br an d sCategory

Hair Car e

Oral Car e

12%3Dabur Amla hair Oil, Vatika hair oil & Vatika Shampoos

13%3 Red toothpaste, Babool, Meswak, Red

7%3 Dabur Gulabari, Fem, Dabur UvedaSk in Car e

A y u r v e d i cTonics 66%1 Dabur Chyawanprash

Fru i t Ju ices 52%1 Real Fruit Juices, Real Activ

Honey 1 50% Dabur Honey

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Hair care includes Hair Oils & Shampoos; Oral care includes Toothpastes & Toothpowder; Skin care includesmoisturizers, face cleaning, lightening, anti ageing & other skin care products; Digestives includes herbal digestives

ucose a ur ucose



BUSINESS STRUCTURE

Dabur opera tes th roug h th ree focused St r a teg i c Bus iness Un i t s

Bu sin ess Un i t Descr ip t ion

FMCG or t f o l i o com r isin f ou r

RevenueShare

Con sum er Car eDiv is ion

d i st i n c t b u s i n esse s:• Pe r son a l Ca r e• Co n su m e r H eal t h Car e• H om e Ca r e

7 2 %

Consum er Heal thRan g e o f e t hica l an d OTC p r od u ct s

- D iv is ion Ay u r v eda in m od er n r eady - t o - u se

f o r m a t s

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I n t e r n a t i o n a lBus iness

Cat er in g t o h ea l t h & per son a l car en eed s o f cu st om er s acr oss d i f fe r en tin t er n at i on a l m ar k et s sp an n in gMid d le East , Nor t h & W est 1 8 %

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, ,t h r ou gh i t s b ran ds Dab ur an d Vat ik a

Note: Percentage share in revenue based on FY10 Financials ; Fem Care included in Consumer Care Division



CONSUMER CARE DIVISION OVERVIEW

HCPDFPD Balsara Foods FEM

FPD: Family Products Division

2 0 0 3 - 2 0 0 4 2 0 0 6 - 2 0 0 7 2 0 0 7 - 2 0 0 8 2 0 0 8 - 2 0 0 9

HCPD: Health Care Products Division

Balsara and Fem were acquisitions

Foods division was a 100% subsidiary of DIL

Hair CareHom e Care Foods i n Rs . mi l l i on

CCD Sales - H is to r i ca lCat egor y- w ise Shar e of CCD Sales

SkinCare

6%

Oral Care18%

HealthSupplemen

t s

Digestives8%

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17%

Note: Percentage share in revenue for H1 FY11



CONSUMER CARE CATEGORIES

7%

Marke t ShareKey B rands

Hair Oi l

16%

3%

37%

6%

31%Bajaj Dabur Dey's Medical

Emami Marico Others Dabur Amla: Vatika: Value added Anmol Hair Oil:

the portfolio

- ,

Ke Br an d s

Shampoo

10%6%

14%

Marke t Share

46%

Cavinkare Dabur HUL

Vatika rangeof shampoos

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P&G Others

Value Share-ACN MAT Dec-2010




13.9%


Oral Car e

50.0%

13.4%

22.7%

Colgate HUL Dabur Others

-

Dabur Red: Toothpaste& Toothpowder

Babool: Targeted ateconomy segment

Meswak: Premiumtherapeutic

Ch y a w a n p r a s h – M ar k e t Sh a r e

,

Key Brand sHea l th Supp lem en ts

13.6%

65.8%

7.2%

2.9%10.5%

Baidyanath Dabur Emami Zandu Others

Dabur Honey: Largest

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Volume Share-ACN MAT - Dec, 2010

Largest selling health

supplement in thecountry

a ur ucose:2nd largest

player in thecountry

branded honey in thecountry; growingcategory through replacesugar strategy





Foods

52.0%13.0%

35.0%

Dabur Pepsi Others

Real: Fla shi Real Activ: Range

Marke t Share*

ompany s . ar, or ru u ce ca egory

beverages brand of 100% pure juice

Ke Br an d s

Sk in Car e

58.9%

6.4%

3.2%

18.0%

6.8%

6.6%

Hindustan Lever Emami Dabur

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17

Loreal Cavin Care Others

*Company estimates;Includes Fem skin care portfolio

based skin care

products:Moisturizer, Facefreshener & Rosewater

em o eac :Launched recently

Ayurvedic Skin

Care




Marke t Share Key B randsDiges t i ves

55%

8%

Hajmola Satmola Others

Value Share-ACN MAT Dec 2010

Hajmola: Flagship brandfor branded Digestives

Hajmola tastydigestive candy

Ai r Freshene rs – Marke t Sha reKey Brand s

Hom e Care

20%26%

20%

30%

5%

Odonil Air wick Premium Ambipur Others

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18

Value Share-ACN March, 2010 for Aerosols category

range: Largest brand

in the portfolio

repellant skin cream

Toilet cleaner



CONSUMER HEALTH DIVISION

Descr ip t ion

9 CHD: Repository of Dabur’s AyurvedicHealthcare knowledge

CHD St ru c tu re

9 Focusing on multiple therapeutic areas.

9 Distribution coverage of 200,000

chemists, ~12,000 vaidyas & 12,000

T 6 4 %

9 Generics

9 Branded Products

ETHI AL 3 6%

9 Tonic

9 Classicals yurve c p armac es

Focus on growing the OTC Health-Careportfolio aggressively

ran e ca s

9 OTC Healthcare is Rs.130 billion size

Hea l thcare Focus

9 Expected to grow at 14-15% p.a. aspreference for Over-the-Counter productsaccelerates

Honitus: Day & Nightfor Cold and Flu relief

Pudin Hara LemonFizz for digestion

9 Consolidating / expanding currentportfolio

9 Launching new products in

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Promoting Dabur Ayurveda: Generatingequity for Ethical portfolio

9 Look at inorganic opportunities



INTERNATIONAL BUSINESS DIVISION

Started as anExporter

Focus on Orderfulfillment through

Set up a franchisee atDubai in 1989

Demand generationled to setting up of

Renamed franchisee as DaburInternational Ltd

Local operations further strengthened

Set up new mfg facilities in Nigeria,RAK

Building scale-18% of overall Dabur Sales

High Levels of Localization

Global Supply chain

1 9 8 0 ’s Ear ly 9 0 ’s 2 0 0 3 On w ar ds Tod ay

.

High l i gh ts

Dabur’s overseas business contributes 18%to consolidated sales led by CAGR of 29% inlast 6 ears

H i gh Gr o w t h i n I B D

i n Rs . mi l l i on

Focus markets:

GCC

Egypt

Turkey

Bangladesh

Nepal

. .

High level of localization of manufacturingand sales and marketing

Leveraging the “Natural” preference amonglocal consumers to increase share in ersonal

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ew p r o u c s con r u n gs ign i f i can t l y to overseas sa lescare categories

Sustained investments in brand building andmarketing and new product launches



INTERNATIONAL BUSINESS - PRODUCT PORTFOLIO

Hai r O i ls

Ex ist in g Pr od u ct s NPDs an d Relau n ch es

Vat i k a Sham poosVat i k a Hamam Zai th – Hai r Fa l l Con t r o l

Vat i k a Cond i t i on e rs

Ha i r Cream s

Ha i r T rea tmen ts a t a er m o v a oaps

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OUR STRATEGY

Thr ee p r ong ed Gr ow t h St r a t egy

Our d i f f e ren t i a t i on i s th e herba l and ayu rved i c p lat f o rm

Expand I n n ov at e Acq u i r e

Expand

9 Strengthening presence in existing categories and markets as well entering new geographies

9 Maintain dominant share in cate ories where we are cate or builders like HealthSupplements, Honey etc.

9 Calibrated international expansion – local manufacturing and supply chain to enhance flexibility / reduce response time to change in market demands

n n o v a t e

9 Strong focus on innovation. Have rolled out new variants & products which have contributed toaround 5-6% of our growth p.a.

Acqu i re

9 Acquisitions critical for building scale in existing categories & markets

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ou e synerg s c an ma e a goo s ra eg c

9 Target opportunities in our focus markets



ACQUISITION OF HOBI GROUP, TURKEY

9 Acquisition of Hobi Group, Turkey for a totalconsideration of US$ 69 Million completed onOctober 7, 2010

9 Hobi manufactures and markets hair, skin andbody care products under the brands Hobby

and New Era

complementary to our product range

9 Acquisition provides an entry into anotherattractive emer in market and a oodplatform to leverage this across the region

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ACQUISITION OF NAMASTE LABORATORIES

9 Dabur India Limited through its subsidiary Dabur International Limited acquired 100% stakein Namaste Laboratories LLC for $100 million, in an all-cash deal on January1, 2011

9 Namasté is a leading ethnic hair care products company, having products for women of colour, with revenues of about $93 million (Expected CY2010) from US, Europe, Middle Eastand African markets

9 The company markets a portfolio of hair care products under the brand ‘Organic RootStimulator’ and has a strong presence in ethnic hair care market for women of colour.

9 Acquisition to enable entry into Ethnic Hair Care products market valued at more than US$1.5billion and tap into significant market opportunity in the fast growing, hugely populated (~1Bn) yet highly underpenetrated consumer markets of Sub Saharan Africa

an acqu s on pr ce o m on, e ea va ue s a . x a es an . x

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FINANCIAL PERFORMANCE – FY2009-10

Sales: FY10 v / s FY09


EBI TDA Marg in : FY10 v / s FY09

18.3%

19.6%

19.00%

19.50%

20.00%

28,34134,167

20000

30000

40000

17.50%

18.00%

.

FY09 FY10

0

10000

FY09 FY10

9 Sales growth led primarily by continueddouble digit volume growth

PAT* : FY10 v / s FY09


3,9125,032

4000

6000

em are arma w c was acqu re n2008-09 and merged with DIL w.e.f. April1, 2009 added about 3.5% in FY10 totopline.

0

2000

FY09 FY10

FY10 led by lower input costs.

9 PAT increased by 28.6% during FY10 due tostrong topline, improving gross margins and

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tax provisioning



FINANCIAL PERFORMANCE - 9M and Q3 FY 2010-11

29,926

Sales: 9MFY11 v / s 9MFY10

i n Rs . mi l l i on 10,878

Sales: Q3FY11 v / s Q3FY10


, ,

9MFY10 9MFY11 Q3FY10 Q3FY11

¾ Sa les f o r 9 MFY1 1 i n cr e a se d b y 1 6 .9 % w h i ch w a s la r g e ly v o l u m e d r i v e n

PAT: 9MFY11 v / s 9MFY10

1,3781,541

3,6704,219



Q3FY10 Q3FY119MFY10 9MFY11

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¾ PAT inc reased by 15% du r ing 9M FY11 desp i te i npu t cost i n f l a t i on andinc reased tax a t ion



STOCK PERFORMANCE AND SHAREHOLDING PATTERN

Shareho ld i ng St r uc tu re *Marke t Cap i ta l i za t ion in Rs . b i l l i on

FIs/

MFs/Ins.

Cos., 7.8%

FIIs, 16.4

%

Indian

Public andOthers, 7.1

%

Promoters,

68.7%

17

*As on December 31, 2010

2001 2010

D ab u r r a n ke d a s t h e o r g a n i za t i o n t h a t o f f e r s t h e b e st r e t u r n t o i n ve st o r s b y

th e 6 th Soc ial & Co rpo ra t e Gove rnance Aw ards , p resen ted by th e BombaySt ock Exchan ge

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CONSOLIDATED P&L

in Rs. m i l l ion Q3 FY1 1 Q3 FY1 0 YoY ( % ) 9 M FY1 1 9 MFY1 0 YoY ( % )

Gr oss Sales 1 0 ,8 7 8 9 ,3 2 3 1 6 .7 % 2 9 ,9 2 6 2 5 ,6 0 7 1 6 .9 %

Less:Excise Duty 78 64 234 188

, , . , , .

Other Operating Income 69 27 153.1% 256 139 84.8%

Material Cost 5,231 4,223 23.9% 14,162 11,664 21.4%

% of Sales 48.1% 45.3% 47.3% 45.6%. , , .

% of Sales 7.4% 7.9% 7.7% 8.2%

Ad Pro 1,349 1,351 -0.1% 4,071 3,779 7.7%

% of Sales 12.4% 14.5% 13.6% 14.8%

, , . , , .

% of Sales 12.2% 12.8% 12.2% 12.5%Other Non Operating Income 20 38 -48.5% 159 175 -9.0%

EBI TDA 2 ,1 8 4 1 ,8 2 3 1 9 .8 % 5 ,9 0 6 4 ,9 8 3 1 8 .5 %

. . . .

Interest Expenses 54 28 91.1% 144 151 -4.2%

Depreciation 160 131 22.2% 437 372 17.4%

Amortization 73 14 423.6% 130 41 215.0%

, , . , , .

Tax Expenses 357 273 30.9% 976 747 30.7%

Provision for Taxation for Earlier years 3

PAT( Bef or e ex cep t ion al i t em ) 1 ,5 4 1 1 ,3 7 8 11.8% 4 ,2 1 9 3 ,6 7 0 15.0%

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. . . .

PAT ( A f te r ex c ep t i ona l I t em s ) 1,541 1,378 11.8% 4,219 3,670 15.0%

PAT ( Af t er Ex t r a o r d in ar y i t em & MI ) 1 ,5 4 4 1 ,3 9 3 1 0 .9 % 4 ,2 1 6 3 ,6 7 8 1 4 .6 %



CONSOLIDATED BALANCE SHEET

i n Rs . m i l l i on As on Dec 3 1 , 2 0 1 0 As on Dec 3 1 , 2 0 0 9

Sour ces Of Funds

Shareho lders ' Fund :

Share Capital 1,741 866, ,

13,620 8,805Minority Interest 41 83Loan Fun ds:

Secured Loans 6,573 1,032 nsecure oans , , ,

Deferred Tax Liability 174 123TOTAL 2 1 ,2 6 0 1 1 ,1 2 0

App l i ca t i on o f funds :

Fixed Assets:

Gross Block 13,729 9,253

less: Depreciation 4,278 3,378Net block 9,451 5,875

Capital WIP 414 593I n v e s t m e n t s 1,201 2,588Cur r en t Assets ,Loans & Advances

Inventories 5,446 4,373Sundry Debtors 2,689 2,135

Cash & Bank balances 6,364 1,514

, , , ,

Less : Cur ren t L iab i l i t i es and Prov is ions :

Current Liabilities 6,087 6,526Provisions 4,306 3,250

1 0 ,3 9 3 9 ,7 7 6

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29

e u r r en sse s , ,

Miscellaneous Expenditure 930 56

Deferred Tax AssetsTOTAL 2 1 ,2 6 0 1 1 ,1 2 0



Investor Relations

Dabur India Ltd

Contact:+91-11-42786000

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DB Investor Presentation March 2011 v1

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