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Kriya…
Vidya…
Ghyan…
Suba…
SAKTHI
SUGARS
LTD.
Analyst Meet
Mumbai, April 12, 2006
Structure
• Sakthi Sugars – At a Glance
• Sugar & Allied Business
– Sakthinagar Unit
– Sivaganga Unit
– Dhenkanal Unit
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Sakthi Soya
Sakthi Auto Component Ltd.
Operational Highlights
Financial Highlights
Social Commitments
New Developments
Crystal Ball Gazing
Sakthi Sugars – At a Glance
Vision
• To be one of the top 5 producers of Sugar in India
• To be one of the top Auto component manufacturers in
India
• To be a leading producer of Alcohol and allied energy
products
• To have the best possible alternative power producers in
the country
• To maximize the trade in Raw sugar so as to maximize
the earnings of the company
Business Overview
Snapshot
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Fourth largest sugar company in India in terms of sugar produced
The largest distillery in Tamilnadu
One of the few fully integrated sugar complexes in the country
Among the first to handle raw sugar processing in the country
One of the lowest cost power projects in the country
Soya unit, one of the first to produce edible Protein
Auto component unit, sole supplier to Indian market
Business Overview
Infrastructure
• 3 Sugar Units (Sakthinagar – Tamil Nadu, Sivaganga – Tamil
Nadu, Dhenkanal – Orissa): Total crushing capacity 13,500 TCD
• 2 Distillery Units (Sakthinagar, Dhenkanal): Total capacity of
120,000 litres per day
• 2 Co-generation Units (Sakthinagar, Sivaganga): Total capacity 35
MW
• 1 Soya Unit (Pollachi – Tamil Nadu): Total capacity 90,000 MT per
annum
• Auto Component Subsidiary – manufactures critical parts for the
Auto industry
Sugar – The Pecking Order
Company Name
Sakthi Sugars L imited
Bajaj H indus tan
Balrampur C hini
Bannariamman
D C M Shriram I nd *
D hampur Sugar
D harani Sugars
D warikes h Sugar
E I D P arry *
M awana Sugar
O udh Sugar M ill
Rajs hree Sugars
Rana Sugars
Simbhaoli Sugar
Shree Renuka Sugars
T hiru A rooran
T riveni E ngg. *
U pper G anges Sugar
Sugar
Production
(in Lakh Mts)
3 .2 7
4 .3 4
3 .7 1
1 .3 4
1 .4 3
1 .3 5
0 .4 7
0 .8 4
2 .9 5
1 .6 0
1 .0 0
1 .3 4
0 .4 8
1 .4 3
1 .1 1
1 .5 7
3 .6 3
1 .4 2
Rank
4
1
2
12
9
11
18
16
5
6
15
12
17
8
14
7
3
10
Sales
(INR Crores)
617
837
814
489
532
466
160
155
717
554
355
179
134
391
226
298
963
265
* includes sales from other businesses & does not include Shree Ambika Sugars
Rank
5
2
3
8
7
9
16
17
4
6
11
15
18
10
14
12
1
13
Sugar & Allied Businesses
Sakthinagar
Sugar Division
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Capacity of 7,500 TCD
Situated in most favourable climatic zone in the country
Highest quantum of sugarcane crushing in a single unit in the country
Current year crushing target - 22 lakh MT
Capable of operating 365 days in a year
Revenue generation in FY06 to be about Rs. 390 crore
Sakthinagar
Distillery Division
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Capacity of 90,000 litres per day
Operates 365 days per annum
Capable of producing 50,000 litres of Ethanol per day
Production expected to be at 3 crore litres in FY06
Revenues expected to be around Rs. 62.4 crore
Sakthinagar
Co-generation Division
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32 MW generation capacity
Project cost of Rs. 2.1 crore per MW – lowest in the industry
Commissioned in November 2003
Total power production per annum will be about 2,650 lakh units and
the evacuation to the state grid per annum will be about 170 lakh
units
• Revenue generation of Rs. 53.7 crore expected
Sivaganga
Sugar Division
• Capacity of 4,000 TCD; Capable of 360 days operation
• Current year crushing will be about 6.5 lakh MT, in addition to
30,000 MT of raw sugar refining
• Crushing will reach 10 lakh MT during the next year
• Situated near the Tuticorin port, resulting in huge benefits on
transport costs on imports and exports
• Annual revenues from this unit is expected to be about Rs. 160
crore in FY06
Sivaganga
Co-generation Division
• Incidental co-generation; Capacity 5.5 MW
• Evacuation to the State Grid shall be 18 lakh units in FY06
• Revenue shall be Rs. 0.57 crore
Dhenkanal
Sugar Division
• Capacity of 2,000 TCD; Operation throughout the year – 180 days of
Sugarcane and 180 days based on raw sugar
• Positioned in sugar deficient North-East region; Capable of
processing 300 tons of Raw sugar daily
• Proximity to Paradeep port gives tremendous advantage in terms of
transports costs on Imports
• Cane crushed during 2006 will be 2.0 lakh MT, Raw sugar refining
will be 25,000 MT; Total revenues shall be Rs. 82 crore
Dhenkanal
Distillery Division
• 30,000 litres per day capacity; Total production for FY06 will be 35
lakh litres
• Revenue shall be Rs. 10 crore
Raw Sugar – The Success Story
• First company in India to process imported raw
sugar
• First company in the world to take-up refining of raw
sugar in a plantation white sugar factory
• All the units are capable of processing imported raw
sugar
• Better positioning of the units near port locations to
take advantage on the arbitrage on the world sugar
market
Raw Sugar Processing Data
Particulars
FY04
FY05
FY06
9 Months
Raw Sugar Processed (MT)
79,100
205,507
65,784
Average landed Cost US$ / MT
240.3
263.5
301.0
Export of Whites Sugar (MT)
1,000
75,000
67,558
Average Export Price US$ / MT
206.6
286.8
350.0
Sakthi Soya
Factfile
• Started as an independent company – now a division
• State-of-the-art plant located at Pollachi with a capacity of
300 TPD and 100 TPD edible oil refinery
• Has Flash De-solventising System to manufacture highprotein soya flour and a Texturised Vegetable Protein (TVP)
capacity of 20 TPD; also produces TVP or soya chunks for
the retail market
• Shortlisted for supply of food grade edible flour for World
Food Programme of UN
• Revenues of Rs. 35 crore expected in FY06
Sakthi Auto Component Ltd.
Snapshot
• Established in 1983 (as a division of Sakthi Sugars)
• Capacity of 2,000 tons of castings per month
• Equipped with Flaskless vertical DISA moulding line and
Special purpose dedicated Machining Lines
• Has sophisticated facilities for R&D
• CNC Machine Division has imported equipments for
machining rough castings to exacting standards of
dimensional castings
• Single source supply for critical components to Maruti
Udyog (17 years) and Hyundai
OEM Vendor
• Has proven track record in providing high value safety
critical auto components to leading domestic and global
OEMs
• First vendor in Asia Pacific to obtain orders from Delphi
North America
• Further orders obtained from ACI (Renault), GM India, GM
Korea and GM Thailand
• 30% of turnover from exports, which is likely to grow by
50% per annum
Product Line
Steering Knuckles
Brake Drums & Discs
Exhaust Manifolds
Brake Calipers
Differential Case
Revenue Mix
Customer
Maruti Udyog
Ilgin Automotive (Hyundai)
IPI – USA
Delphi – Mexico
Delphi – USA
Others
Total
Monthly Sales –
FY06
(Rs. Crore)
6.0
1.7
1.0
0.9
1.0
1.9
12.5
Operational Highlights
Operations – Cane Crushed,
Sugar Produced & Recovery
30
25
20
15
10
5
0
FY97 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06
15
9mnths
mnths
Cane Crush(Lakh Mts)
Sugar Produced (Lakh Qtls)
Recovery (%)
Financial Highlights
Performance For Mar 06
Particulars
Mar 06
(3 months)
Mar 05
(3 months)
Mar 06
(9 months)
Mar 05
(9 months)
Cane Crushed (Lakh Mts)
9.14
3.42
18.97
5.21
Raw Sugar Processed (Lakh Mts)
0.13
0.72
0.79
1.54
Sugar Production (lakh Mts)
1.05
0.97
2.53
1.78
Total Income (Rs. in Crores )
239.14
212.42
619.75
429.86
EBIDTA
79.55
39.96
151.92
63.62
Interest
18.93
8.60
56.19
28.83
2.98
2.85
8.90
8.63
Profit for the period
57.64
28.51
86.83
26.16
Prior year adjustments
23.48
23.78
0.06
Net Profit
34.16
28.51
63.05
26.10
10.9
9.08
20.1
8.3
Depreciation
EPS (in Rupees)
Performance (Contnd)
• The cane crushing has more than tripled for the 9
months
• The margins from Cogen plant has gone up many folds
due to absence of fuel cost
• The sugar realisation has steeply increased from 16350
per Mt for qtr Mar 05 to 17600 per mt for the Mar 06 qtr
• The company had exported 26558 Mts during the qtr on
a total sale of 103676 Mts
• The realisation on exports was higher by Rs.1000 per
Mts and the company will continue to export about 50%
of its production in the next one year
Segment-wise Turnover
( Rs Crores)
Segment
Sugar
Alcohol
FY02
Fy03
FY04
FY05
441.33
248.10
224.82
439.35
38.37
38.74
55.79
84.43
Power
83.46
Soya
32.96
34.85
29.31
17.51
Auto Component
68.71
75.40
91.18
113.46
Segment-wise EBIDTA
( Rs Crores)
Segment
FY02
Fy03
FY04
FY05
Sugar
59.13
-13.36
-8.40
21.14
Alcohol
12.02
12.54
16.51
43.25
Power
Soya
Auto Component
16.49
2.85
2.45
-4.14
-3.23
16.50
18.59
17.63
22.19
Shareholding Pattern
Public
34%
Mutual
Funds
5%
Promoters
39%
FII's
18%
Banks & FI's
4%
New Opportunities
Raw Sugar Processing
• The sugar industry is in the process of decontrol
• Sakthi is the first company to start raw sugar processing in
India
• Location of factories across ports at different sugar price
zones gives edge to gain on sugar arbitrage
Ethanol Blending
• 5% Ethanol blending with petrol has been made compulsory
with effect from 1st October 2003 in nine sugar producing
States
• Government exploring admixture with diesel
• Will save substantial forex
• Eco-friendly product : answer of the times
• Will lower emission of green house gases – will take to Euro
IV faster
• To replace use of MTBE as an oxygenate in fuel
• To increase demand for alcohol and thereby molasses
Attractive Co-generation Incentives
• Electricity Bill 2003 passed to open up power sector
• Sugar industry can generate 4,000 MW surplus power by
using bagasse as by-product
• 10% power in India to come from renewable energy source
• Power generation from bagasse comes under clean power
• Soft loans to be provided from Sugar Development Fund to
encourage co-generation at 4% interest
• Power distributors in India have to buy a certain percentage
of power from renewable energy source
Social Commitment
Responsibility to Society
• The group has established and runs many colleges,
polytechnics and schools.
• The total number of students in such institutes are around
20,000
• Rural Hospitals are being maintained
• The number of patients is around 700 per day
• A leprosy eradication programme is run by the group
Responsibility to Society
• Many other institutes to deal with physically challenged and
elders are being maintained.
• The colleges run by the group are ranked amongst the best
in the country
• A de-addiction center is maintained
Crystal Ball Gazing
Expansion – Elixir for Growth
• Rapid expansion on the anvil
• Total Capital Expenditure of Rs. 240 crore is planned over
the next 18 months
• Expansion in sugar business – greenfield (3500 TCD)
• Expansion of co-generation capacity by 85 MW
Sugar
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New plant with a capacity of 3,500 TCD planned
New unit to have a 25 MW co-generation plant
Capex estimated to be around Rs. 120 crore
Plant expected to be commissioned by March 2007
Revenue generation in full year of production expected to
be in the region of Rs. 200 crore
Co-generation
Sakthinagar
• The company plans to increase the co-generation capacity by 25
MW taking the total capacity to about 60 MW
• The investment expected is about Rs. 60 crore
• The expected date of commissioning is June 2007
• The incremental revenues shall be about Rs. 40 crore
Sivaganga
• Propose to replace existing 5.5 MW incidental capacity with a full
fledged 35 MW capacity co-generation unit
• Capex expected about Rs. 80 crore
• New co-generation unit expected to be commissioned by March
2007
• Additional revenue generation of around Rs. 40 crore expected
Future Guidance
• Cane crushing levels are likely to go up to 43 lakh MT by
FY08
• Sugar revenues likely to grow by 20% by FY2008
• Power revenues likely to increase by 300% by FY08will
triple by FY08
• Auto revenues are likely to grow by 200% by FY08 with
the existing order book position
Sarvam Sakthi
Mayam
THANK
YOU