DIL-Inv-Presentation--Morgan -Stanley-India Summit-June-13.pdf
Transcript of DIL-Inv-Presentation--Morgan -Stanley-India Summit-June-13.pdf
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Dabur India Limited
June 2013, Mumbai
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Indian Economy
Real GDP Growth Rate Inflation
9.3% WPI based inflation Food Inflation CPI based inflation
.
5.0%
7.5%
10.9
8.7%10.3%
10.4%
FY11 FY12 FY13
6.0%
Apr12 May 12 Jun 12 Jul12 Aug12 Sep 12 Oct 12 Nov12 Dec12 Jan 13 Feb 13 Mar 13
Overview
Source: CSO estimates Source: Office of Economic Adviser, CSO estimates
Real GDP growth rate witnessed deceleration, particularly in FY13 Recently, Prime Minister's Economic Advisory Council (PMEAC) has projected GDPgrowth rate at 6.4% in FY14
Inflation articularl WPI based has witnessed some moderation durin fiscal 2012 13 RBI has initiated rate cuts in its recent policy reviews
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FMCG Sector in India
a third of revenues
As per a study conducted by Booz & Company, FMCG sector is expected to grow in the range of 12% to 17% upto 2020 and could touch a market size between Rs. 4,000 to Rs. 6,200 billion by 2020
Key Growth Drivers:
Low per capita Favourable
Low penetration
levels of
Shift to branded
products from Growth
potential in
consumer products
unbranded products
rural markets
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Category Penetration Levels
77% 80%80%
90%
Rural Penetration Urban Penetration
42%37%
57% 59%
50%
60%
18% 18%
4%
32%
19%
5%
26%
10%
20%
30%
Source: Industry data
0%
Toothpaste Shampoo Hair Oil Skin Cream Mosquito Repellants
Instant Noodles
Hair Dyes Floor Cleaners
Low penetration levels offer room for growth across consumption categories Rural penetration still lower but catching up with urban penetration levels
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Per Capita Consumption
7.4 7.7
5
6
7
8
9 2.72.4
2
2.5
3
3.2
0.8 0.30
1
2
3
4
China Indonesia India Malaysia Thailand
1.0 1.1
0.3
0
0.5
1
1.5
China Indonesia India Malaysia Thailand
3.5
Toothpaste Per
Capita
Consumption
(in
US$)
0.51.0
2.9
2.0
1
1.5
2
2.5
3
.
0
0.5
China Indonesia India Malaysia Thailand
Source: MOSL
India has very low per capita consumption levels as compared to other emerging economies
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Rural India PotentialIncremental Consumption Expenditure
in 2011 12 over 2009 10Percentage increase in monthly per capita expenditure
19.2%17.3%
Rural Urban
2994
3750in Rs. bn
7.3% 7.5%
13.2%. 11.8%.
Overview
Source: NSSO estimates Source: NSSO and Crisil estimates1987 94 1993 05 2004 10 2009 12 Urban Rural
Rural India comprises c. 70% of Indias 1.2 billion population and 240 million households Represents a huge opportunity for the FMCG sector Nielsen estimates it could touch US$100billion by 2025
easures e g er n mum upport r ces or agr cu tura pro uce, oan wa vers anemployment guarantee schemes, have promoted demand for consumer goods in rural Rural consumption growth is outpacing urban consumption with:
Percentage increase in monthly per capita expenditure being higher for rural in the period2009 2012
Incremental consumption expenditure in rural India being significantly ahead of urban India6
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Dabur Overview
Established in 1884 more than 128 Years of Trust & Excellence 14 billion Rupee brands
Worlds largest in Ayurveda and natural healthcare
Sales of Rs. 61.5 billion and profits of Rs. 7.6 billion in FY201213
20 world class manufacturing facilities catering to needs of diverse markets
rong overseas presence w contribution to consolidated sales
. million retail outlet reach in India7
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Dabur Performance Snapshot
Sales
28.1 33.9 40.8
52.8 61.5
into superior shareholder returns in INR bn
FY09 FY10 FY11 FY12 FY13 Market Capitalization
in INR bn
5.2 6.7 8.3
9.5 11.2
8.0
10.0
12.0
14.0
16.0
85.4
137.8167.2 185.4
.
in INR bn
0.0
2.0
4.0
6.0
FY09 FY10 FY11 FY12 FY13 FY09 FY10 FY11 FY12 FY13
3.9 5.0 5.7
6.4 7.6
5.0
7.0
9.0
11.0 Profit after Taxin INR bn
1.0
1.0
3.0
FY09 FY10 FY11 FY12 FY13 8
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Business Footprint
UK
Turkey
U.S. EgyptUAE
Nepal
Nigeria
BDesh
Sri Lanka
Domestic Mfg.Locations
Manufacturing Facilities
Key markets
Our strategy is to localize manufacturing, supply chain and product offerings to suit consumer requirements in each geography
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Our Billion Rupee Brands
Home Personal Care
Health Care
Foods
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Dabur Domestic Distribution Structure
DepotDepot (Carry & Forward Agents)
Modern TradeStockist
Modern TradeStockist
uper s oc s super s oc s s
WholesalersWholesalers Sub stockistsSub stockists
Insti customers
Insti
customers
Retail
trade
Retail
trade
Shoppers & ConsumersShoppers & Consumers Direct reach 0.8 mn outlets
Rural tradeRural trade
Total reach at 5.8 mn retail outlets > 3 rd highest among FMCG companies 11
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Dabur Business Structure
.
Domestic (69%)
(31%)
Consumer Care (55%)
Foods (11%)
Retail (1%)
Others (3%)
International
(19%)
Namaste Labs (8%) Group
(3%)
* Others includes Commodity Exports etc
Note: % figure in brackets indicate % share in Consolidated Sales for FY13
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Dabur Sales by Business Vertical Dabur derives 69% of its sales from Domestic business (Consumer Care + Foods + Others)
Foods11%
Others4%
and 31% from International business
InternationCare55%
al Business31%
Health Supplements
21%Oral Care17%
Skin Care6% Africa
21%
U.S.
Others4%
Digestives7%Home
Care7%
Asia
22%
OTC & Ethicals
12%Hair Care30%
17%
Middle East36%
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Consumer Care CategoriesCategory Key Products and Brands Market Position
Health
Chyawanprash: Honey: Glucose:#1 in Ayurvedic Tonics (Chyawanprash)
Supplements n ran e oney
#2 in Glucose
Herbal Digestives:
ges ves
OTC &
Baby Care: Cough & Cold: Womens Health
#1 in Ayurvedic OTC
Ethicals
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Consumer Care Categories (Contd.)Category Key Products and Brands Market Position
Hair Care
Hair Oils: Shampoo: #2 in Hair Oils
#4 in Shampoos
Toothpastes : Toothpowder: #3 in Toothpastes
#2 in ToothpowdersOral Care
Home Care
Air Freshener: Mosquito Rep. Cream: Toilet Cleaner: #1 in Air Fresheners
#1 in Mosquito Repellant Creams
#2 in Toilet Cleaners
Skin Bleaches Rose Water Creams & Lotions#1 in Skin Li htenin
Skin Care (Bleaches)
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Foods
Foods portfolio comprises Fruit Juices and Culinary rangeFruit Juices are under the brands Real, Activ and Burrst
Culinary range is under Hommade brand
Key Products and Brands Market Position
Juices & Nectars:
Culinary:
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Project Double Rural Coverage Enhancement
Project Double
rolled
out
during
2012
13
to
expand
direct
coverage
in
rural
markets
Ten states where this project has been implemented are Uttar Pradesh, Maharashtra, Madhya Pradesh, Bihar, West Bengal, Assam, Karnataka, Rajasthan, Orissa and Punjab
Direct coverage increased from 14,865 villages in March 2011 to 30,091 villages in March 2013
This has led to strong volume led growth in rural business with improved product width and profitability
Direct Village Coverage Dabur
14,86517,882
30,091
1 0 , 0 0 0
1 5 , 0 0 0
2 0 , 0 0 0
2 5 , 0 0 0
3 0 , 0 0 0
3 5 , 0 0 0
0
5 , 0 0 0
Mar 11 Mar 12 Mar 13
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International Business
International Sales Breakdown FY13Overview
U.S.
Daburs international business contributes 31% toconsolidated sales
Our focus markets are Africa, Middle East and Asia as
Africa
Middle East36%
22
Others4%
ese o er su s an a ong erm grow oppor un es
Our international business foray had been entirelyorganic since 1980s, until FY2010 11 when we acquiredHobi Group and Namaste Labs
17%e s r ve owar s g eve s o oca ze supp y c a ns
Over the years, we have made sustained investments inbrand building and marketing
Started as an ExporterFocus on Order fulfillment
Renamed franchisee as Dabur International LtdLocal operations further strengthened
Daburs international journey :
1980s Early 90s 2003 Onwards Today
. e up new m g ac es n ger a,Bangladesh
Set up a franchisee at Dubai in 1989
Demand generation led to setting up ofmfg in Dubai & Egypt
Building scale- c. 31% of Consol. SalesHigh Levels of Localization
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International Business (Contd.)Africas Bulging BaseAfrica Opportunity
With a population of c. a billion, Africa offers hugepotential for the consumer sector in the long run driven byfactors such as rapidly emerging middle class, withincreasing disposable incomes
Between 2005 and 2015, it is estimated that in Africa, the
share of individuals earning above US$1,000 will growfrom 39% to 55%. The rapidly emerging African middle class could number asmany as 300 million, out of a total population of one billion
The acquisition of U.S. based Namaste Labs, whichspecializes in African Hair Care was a step towardsenhancing our presence in Africa and exploiting these
Source: McKinsey on Africa, June 2010growt opportun t es
Namastes Product Suite, under the ORS brand (earlier Organic Root
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Growth Strategy
Three Pillars of Growth
xpan
Strengthen presence in existing categories and markets as well enter new eo ra hies
nnova e
Strong focus on innovation. Have rolled out new variants and products which have contributed to our rowth
cqu re
Acquisitions critical for building scale in existing categories and markets
Maintain dominant share in categories where we are category builders like Health
Supplements, Digestives etc.
Renovation of existing products to respond to changing demands
(Toothpowder to Toothpaste)
ou e synerg st c an make a good strategic fit
Target opportunities in our focus markets and categories
other categories
International expansion local manufacturing and supply chain to enhance
time to change in market demands
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New Launches India
Babool: Salt Variant
a mo a: aunc o nar ana var ant
Activ: Drinking Yoghurt
Gulabari: Moisturizing Lotion
Odonil Gels
Fem: Turmeric VariantLaunch of Ethnic Flavour Kokam
under Real Burrst21
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New Launches International
at a nr c e a r Oil Black Seed
Da ur Me icate Toothpaste
Vatika Professional Range
Launch of Fem range in Turkey
Vati a Henna Hair Color
Vati a ENRICHED Coconut Hair Oil with
Curry Leaves22
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Recent Performance61,46470000 Consolidated Sales grew by 16.3% during FY13
,
100002000030000400005000060000
Sales growth was largely driven by volume growths and some price increases and translation gains
Revenue (in Rs. mn)
0
FY12 FY13
11 243 EBITDA margin expanded to 18.3% in FY13 from9,476
4000
60008000
1000012000
EBITDA
(in Rs. mn)
17.9% in FY12 Material costs eased at 49.1% of sales in FY13v/s 51.0% in FY12
10000
0
FY12 FY13
.12.5% in FY12
6,449 7,634
2000
4000
6000
8000
PAT* (in Rs. mn)
.
in Consolidated PAT PAT margins improved to 12.4% in FY13 v/s12.2% in FY12
0
FY12 FY13*After minority interest 23
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Market Cap and Shareholding Pattern
288.8 DIIs, 4.3% Others,
6.9%
Shareholding Structure*Market Capitalization
in Rs. billion
85.4 Promoters, 68.7%
, .
FY09 May13*As of Mar 31, 2013
Dabur has witnessed exponential increase in market capitalization over the years an as crosse t e on mar n terms o mar et cap ta zat on
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Consolidated P&LIn Rs. million Q4FY13 Q4FY12 YoY (%) FY13 FY12 YoY (%)
e a es , . , . . , . , . .Other Operating Income 125.6 82.8 297.4 222.5Material Cost 7,398.7 6,848.9 8.0% 30,193.4 26,924.0 12.1%% of Sales 48.3% 50.2% 49.1% 51.0%Employee Costs 1,209.0 956.3 26.4% 4,712.3 3,874.2 21.6%% of Sales 7.9% 7.0% 7.7% 7.3%
Ad Pro 1,919.2 1,820.4 5.4% 8,369.8 6,595.1 26.9%% of Sales 12.5% 13.4% 13.6% 12.5%
Other Expenses 2,181.1 1,773.3 23.0% 8,187.7 6,759.2 21.1% . . . .
Other Non Operating Income 229.8 113.6 102.4% 945.0 574.0 64.6%EBITDA 2,958.3 2,433.2 21.6% 11,242.9 9,475.6 18.7%% of Sales 19.3% 17.8% 18.3% 17.9%Interest Exp. and Fin. Charges 149.8 57.2 161.6% 589.0 538.4 9.4%Depreciation & Amortization 281.6 293.3 4.0% 1124.0 1032.4 8.9%Profit Before Tax (PBT) 2,526.9 2,082.6 21.3% 9,529.9 7,904.7 20.6%Exceptional Item 0.0 0.0 46.6 0.0Tax Expenses 506.8 377.3 34.3% 1826.3 1463.8 24.8%PAT Before extraordinar item 2020.1 1705.4 18.5% 7657.1 6441.0 18.9%
% of Sales 13.2% 12.5% 12.5% 12.2%Extraordinary Item 0.0 0.0 0.8 0.0PAT(After extraordinary Items) 2020.1 1705.4 18.5% 7657.9 6441.0 18.9%Minority Interest (Profit)/Loss 14.6 0.4 23.7 7.8
ter xtra or nary tem Minority Int) 2005.5 1705.0 17.6% 7634.3 6448.8 18.4%
% of Sales 13.1% 12.5% 12.4% 12.2%
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Statement of Assets and LiabilitiesParticulars (in Rs. Million) As at 31/03/2013 As at 31/03/2012
EQUITY AND LIABILITIES are o ers un s(a) Share capital 1,742.9 1,742.1(b) Reserves and surplus 19,500.9 15,429.7
Sub-total - Shareholders' funds 21,243.8 17,171.82. Share application money pending
2. Minori ty in terest 120.6 30.33. Non-current li abilities
(a) Long-term borrowings 5,399.3 7,271.8(b) Deferred tax liabilities (net) 362.1 274.0(c) Other long-term liabilities 1.2 0.0(d) Long-term provisions 491.9 2,056.6
Sub-total - Non-current liabilities 6,254.5 9,602.44. Current li abilities
(a) Short-term borrowings 6,114.2 3,409.1(b) Trade payables 7,443.0 4,768.1(c )Other current liabilities 4,319.6 5,084.0(d) Short-term provisions 1,868.4 1,937.6
- - , . , .TOTAL - EQUITY AND LIABILITIES 47,364.1 42,003.3B ASSETS
1. Non-current assets(a) Fixed assets 10,530.5 8,853.6(b) Goodwill on consolidation 6,214.0 7,826.3(c) Non-current investments 1,304.7 892.8(d) Long-term loans and advances 157.7 258.4(e) Other non-current assets 3,126.8 1,019.2
Sub-total - Non-current assets 21,333.7 18,850.32 Current assets
(a) Current investments 5,014.1 3,932.4(b) Inventories 8,438.6 8,239.2c ra e rece va es , . , .
(d) Cash and cash equivalents 5,128.1 4,184.2(e) Short-term loans and advances 2,015.0 1,858.3(f) Other current assets 593.3 322.1
Sub-total - Current assets 26,030.4 23,153.0Total -Assets 47,364.1 42,003.3 26
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Disclaimer
Some of the statements made in this resentation contain forward lookin information thatinvolve a number of risks and uncertainties. Such statements are based on a number of
assumptions, estimates, projections or plans that are inherently subject to significant risks, aswell as uncertainties and contingencies that are subject to change. Actual results can differmaterially from those anticipated in the Companys forward looking statements as a result of a
var ety o actors, nc u ng t ose set ort rom t me to t me n t e ompany s press re eases anreports and those set forth from time to time in the Companys analyst calls and discussions. Wedo not assume any obligation to update the forward looking statements contained in thispresentation.
No part of this presentation shall form the basis of or may be relied upon in connection with anycontract or commitment. This presentation is being presented solely for your information and issubject to change without notice.
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