investor update for the quarter ending 30th september 2019located in mahindra world city, jaipur sez...

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Investor Update For the Quarter Ending 30 th September 2019 October 2019

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Page 1: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Investor Update – For the Quarter Ending 30th September 2019

October 2019

Page 2: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Disclaimer

Certain statements in this communication may be considered as ‘forward looking statements’ within the

meaning of applicable law and regulations. These forward-looking statements involves a number of

risks, uncertainties and other factors that could cause actual results to differ materially from those

suggested by the forward looking statements, important development that could affect the company’s

operations include changes in the industry structure, significant changes in politics and economic

environment in India and overseas, tax laws, import duties, litigation and labour relations.

Aro granite industries limited does not undertake to revise any forward-looking statement that may be

made from time to time by or on behalf of the company.

Aro granite industries limited will not be in any way responsible for any action taken based on such

statement and undertakes no obligation to publicly update these forward looking statement to reflect

subsequent event or circumstances.

2

Page 3: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Special Economic Zone Unit

Located in Mahindra World

City, Jaipur

SEZ

Company Snapshot

Started commercial

operation in 1991

Largest processed Granite

exporter out of India

100% export oriented,

located at Hosur,

Tamil Nadu

Listed on NSE Since

2007 & BSE Since

1997 in India

Supply of over 100

shades of Granite from

India and other countries

Export to more

than 50 countries

Installed capacity

Granite Slab:

735,000 Square Meters

Granite Tiles:

360,000 Square Meters

3

Page 4: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Indian Granite Industry

20%

Accounts for 20%

of the world’s

granite resources

66%Has more than

66% of around

300 shades

available in the

world

97%97% of the total

granite resources are

untapped

9%Accounts for more

than 9% of the world

stone exports

20%

19%

5%4%

25%

6%56%

5%

3%

India Granite Export FY 2015-16 Figures in Rs. Cr

4

Source - Indian Minerals Yearbook 2016

7%7 of the total granite

resources are black

granite which has huge

demand

2,590.48

1,640.95

357.00 343.47315.88 280.45

3,743.87

0.00

1,000.00

2,000.00

3,000.00

4,000.00

China USA Germany Turkey Vietnam UK Other

88.37

38.50

32.6420.65

19.2613.56

35.45

0.00

20.00

40.00

60.00

80.00

100.00

Norway Brazil Sri lanka China Italy Ukraine Other

Source - Indian Minerals Yearbook 2016

India Granite Import FY 2015-16 Figures in Rs. Cr

Page 5: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Indian Granite Industry

Total exports

Export to China

India exported $1.6 billion worth

of granite in FY2018 of which

$442 million was exported to

China

China is largest market for Indian

raw granite block, 28 % of the total

granite were exported to China

Large players finished products are

5

Karnataka

Rajasthan

20%

Jharkhand

Gujarat

Andhra

Pradesh

Madhya

Pradesh

Others

13%

20%

19%

18%

4%

5%

Source – Indian Mineral Yearbook 2018

Statewise Granite Reserves

$ 1.6 billion

$442

milion

Page 6: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Hosur Infrastructure

Cut to Size

CNC Machine 2

Edge Polishing 1

Slab Plant

Jumbomatic Gang saws 12

72 Wire Multi Wire Saw 1

20 Head Polishing Line 3

12 head Grinding line 1

Flaming machine 1

Epoxy lines 3

Tile Plant

53 Blade cutting Centre 4

Topping Centre 1

Calibration Line 1

Epoxy line 1

20 Head Polishing line 1

Cross cutting machine 4

Cleft/Split Machine 1

6

Page 7: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

HOSUR – Slabs

7

• 12 super Jumbo Matic Gangsaws

• 1x72 wire Multi Wire

• Processing over 100 colours of

Granite and Quartizite

• Raw Quartizite sourced from

India, Norway, Brazil, Finland, Africa,

Ukrain and Iran

Page 8: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

HOSUR – Gangsaws & Multi Wire Cutter

8

• 12 x Super Jumbo Gangsaws (4.5m)

• Suited for Cutting Most Granites

• 1 x Multi Wire (72 Wire)

• Suited for Fragile Granites, Quartizites, and Special Colours

Page 9: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

HOSUR – Tiles

9

• 4 nos. Multi Blade Block Cutting Centres

• Calibrated and Chemfered tiles

• Over 25 years of experience in tile

Page 10: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

HOSUR -Ware House / Showroom

10

120,000 Square Feet of Display Space

Page 11: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Financial Performance

11

Particulars In Rs. Cr Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY19 Q1 FY20 Q2 FY20

Sales 43.75 41.94 39.78 46.97 48.28 43.30

Operating Exp 38.15 37.38 32.36 38.69 41.51 38.89

EBITDA 5.60 4.56 7.42 8.28 6.91 4.54

PAT 1.54 0.53 4.16 3.46 2.40 0.08

EBITDA Margins (in %) 12.80% 10.87% 18.65% 17.62% 14.32% 10.48%

Net Profit/Loss Margins (in %) 3.52% 1.26% 10.47% 7.37% 4.98% 0.18%

Page 12: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Financial Highlights

12

Sales Increased by 3.24% From 41.94 Cr in Q2 FY2018-19 to 43.30 Cr in Q2

FY2019-20

EBITDA Decreased By 0.44% From 4.56 Cr in Q2 FY2018-19 to 4.54 Cr in Q2

FY2019-20

PAT Decreased By 84.91% From 0.53 Cr in Q2 FY2018-19 to 0.08 Cr in Q2

FY2019-20

EBITDA Margins Decreased By 3.59% From 10.87% in Q2 FY2018-19 to 10.48%

in Q2 FY2019-20

Page 13: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Financial Overview (Quarterly)

Revenues from operations Figures in INR Cr. EBITDA Figures in INR Cr.

Profit After Tax Figures in INR Cr. Debt to Equity Ratio

13

43.75 41.9439.78

46.97 48.2843.30

0.00

15.00

30.00

45.00

60.00

Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20

5.604.56

7.428.28

6.91

4.54

0.00

2.00

4.00

6.00

8.00

10.00

Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20

1.54

0.53

4.16

3.46

2.40

0.08

0.00

1.00

2.00

3.00

4.00

5.00

Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20

0.58 0.64 0.620.71 0.81 0.84

0.00

0.50

1.00

1.50

2.00

Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20

Page 14: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Figures in Lakh Sqm. Raw Material Consumption (Cubic Meters) Figures in ‘000

Segment Sales - Slabs Figures in INR Cr.

14

Financial Overview (Quarterly)

Sales Volume (Square Meters)

Segment Sales - Tiles Figures in INR Cr.

1.20 1.18 1.06 1.24 1.26 1.33

0.00

1.00

2.00

3.00

4.00

Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20

3.33 3.21 3.47 3.34 3.70 4.03

0.00

2.00

4.00

6.00

8.00

10.00

Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20

34.34 32.7130.92

38.69 38.9031.89

0.00

15.00

30.00

45.00

60.00

Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20

9.41 9.23 8.86 8.28 9.38 9.13

0.00

2.50

5.00

7.50

10.00

Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20

Page 15: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Financial Overview (Annual)

Revenues Figures in INR Cr. EBITDA Figures in INR

Profit After Tax Figures in INR Cr. Debt to Equity Ratio

15

260 260

216239

201172

0

75

150

225

300

FY2014 FY2015 FY2016 FY2017 FY2018 FY2019

38.9033.80

21.10

30.70

13.78

25.85

0

15

30

45

FY2014 FY2015 FY2016 FY2017 FY2018 FY2019

21.10

16.70

5.90

12.60

1.17

9.71

0.00

15.00

30.00

FY2014 FY2015 FY2016 FY2017 FY2018 FY2019

0.77 0.77

0.90

0.77

0.54

0.71

0.00

0.25

0.50

0.75

1.00

FY2014 FY2015 FY2016 FY2017 FY2018 FY2019

Page 16: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Sales Breakup FY2019

16

Segments

15%

85%

Tiles

Slabs

79%

21%

94%

6%

Exports

Exports and Domestic sales

Domestic

Page 17: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

New Plant (Jaipur)

17

• Commercial production has started in the plant

from August 2019• A new Plant in Jaipur with one (72 wire) Multi

Wire has been commissioned

• The Plant capacity is 150,000m2 per Annum

• Ideally located to take advantage of

transportation from Quarries

• The Plant is set up in Mahindra SEZ with GST and

Tax Benefits

Page 18: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

New Processing Facility (Quartz)

18

• Company is setting up processing facility for Quartz in its existing plant in Hosur

• The Quartz Plant capacity is 180,000 m2 per Annum in the first phase

• Aro’s existing infrastructure for polishing, finishing and packing shall be commonly used for quartz and

Granite processing

• Erection work has started from August 2019, with most of the machinery dispatched to the plant

• The plant is expected be operational by Q2FY2020-21

Page 19: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

Outlook

19

The production is constrained by huge shortage of raw blocks. This has resulted in limiting the

production at the main plant

The company is focusing on higher margin products. It has stopped processing products where the

margins are low or they are slow moving

The operating environment for the granite industry in India is quite challenging due to shortage of

raw blocks are limited operating quarries. Many quarries have closed across India due to the lack of

valid Environmental Clearance (EC).

The company has opened the new facility at Jaipur, Rajasthan which became operational in Aug

2019. The plant is expected to break even in the first year of operation, with the biggest advantage

being the reduction in transportation costs

India granite exporters are facing competition from engineered stone. This has impacted the

demand of granite and other natural stones

The company is foraying into engineered stone manufacturing and expects to commission a new

line in its existing site in Hosur by Q2 FY2021

Page 20: Investor Update For the Quarter Ending 30th September 2019Located in Mahindra World City, Jaipur SEZ Company Snapshot Started commercial operation in 1991 Largest processed Granite

For any further information, please contact

Sabyasachi Panigrahi

Aro granite industries ltd.

[email protected]

+91 11 41686169

© Aro granite industries limited. All rights reserved.

The Aro granite industries limited’s Logo is the trademark of Aro granite industries limited. In addition to company data, data from market research agencies, stock exchanges and industry publications has been used

for this presentation. This material was used during an oral presentation; it is not a complete record of the discussion. This work may not be used, sold transferred, adapted, abridged, copied or reproduced in whole or

in part in manner or form or in any media without the prior written consent. All product names and logos mentioned herein are the trademarks or registered trademarks of their respective owners.

Registered Office: #1001, I0th Floor, DLF Tower A, Jasola , New Delhi - 110 025. (INDIA)

Corporate Office & Works: Koneripalli Village, Shoolagiri (Via), Hosur ( TK) - 635 117, Tamilnadu, INDIA.

Gaurav Sud

Kanav Capital Advisors Pvt. Ltd.

[email protected]

+91 98101 22432