Investor Presentation February 2018
Contents Ayurveda – Science of Life Dabur – Overview Business Structure India Business International Business The next growth wave Latest Financials Annexure 2
Ayurveda – Science of Life What is Ayurveda? Salient features of Ayurveda Heals by activating the natural inherent 1 curative force of the body Believes in complete cure and not only control of 2 signs and symptoms “ Ayur ” + “Veda” = Science of Life Gives more stress on why is the problem rather 3 than what is the problem • Ayurveda is the traditional system of healthcare Being natural, its relative safety is better than which promotes PREVENTION FIRST and CURE 4 conventional chemical drugs NEXT • Based upon Natural Remedies which incorporate the Believes not only in restoration of Health , but also healing properties of plants and herbs 5 the dynamic internal balance Holistic in nature and cures the patient as a whole 6 and not the symptoms of disease alone 3
Growing preference for Herbal/Ayurvedic products Growth drivers Growing emphasis on natural regimes and desire 1 for holistic lifestyles Consumers 2 Increasing health awareness are going herbal 3 ‘Back to roots’ : tradition / heritage gaining ground 4 Concern about chemicals Consumers are gravitating towards herbal products not Millennials moving towards only in healthcare but also natural & herbal products due personal care segments to their concerns about health & ill effects of chemicals Companies with herbal traditions and deep product knowledge are better placed Source: Euromonitor 4 Note: Herbal / traditional market includes Ayurveda and Unani and excludes homeopathic remedies
Dabur & Ayurveda Ayurveda = Dabur’s Core Philosophy Synonymous with Ayurveda since 133 years Known for making Ayurveda accessible to every household in India Anchored by Heritage Stringent quality test of every ingredient and herb Propelled by Science Strong R&D infrastructure including in-house Ayurvedic doctors & scientists Governed by Trust Over 4,000 acres of cultivation of endangered herbs and plants 5
Contents Ayurveda – Science of Life Dabur – Overview Business Structure India Business International Business The next growth wave Latest Financials Annexure 6
Dabur – Overview Overview Awards Established in 1884 – 133 years of trust and Dabur Vatika #BraveandBeautiful excellence campaign wins 2 Effies One of the world’s largest in Ayurveda and natural healthcare Dabur moves up 4 Places in Fortune India 500 List ; ranked 163 in the list for Having one of the largest distribution network in 2015 India, covering 6 mn+ outlets 19 world class manufacturing facilities catering to Dabur named Outstanding Indian needs of diverse markets Company in US , by Indo-American Chamber of Commerce Strong overseas presence with ~30% contribution to consolidated sales Dabur ranked 25 in the list of Best Companies for CSR in India , according to the Economic Times Market cap: Dabur India successfully held the first- US$ ever Guinness World Record attempt 9.7bn for the largest simultaneous Nasya Panchkarma Treatment session 7 INR:USD F/X Rate: 65.06
Key milestones Foods business Established by Dr. S.K. Acquired Balsara crossed INR 10.0 bn Burman in Kolkata turnover mark Inducted professional Acquired Hobi and management Namaste 1884 1994 1998 2000 2005 2008 2010 2012 2016 2018 Crossed the INR 10.0 Crossed the USD 1 bn bn turnover mark turnover mark Came out with first Acquired Fem Pharma Market cap of $9.7 bn public issue 8
Strong financial profile (1/2) Sales Revenue declined due to: Shift to the new Indian Accounting Standards (IndAS) • led to the restatement of financials 84.4 Demonetisation led to reduced consumer demand for • 78.1 76.8 61.5 70.7 few months Currency devaluation in overseas markets • FY13 FY14 FY15 FY16 FY17 (Ind AS) PAT PAT PAT margin (%) 16.60% 14.80% 13.70% 12.90% 12.40% 12.8 12.5 10.7 9.1 7.6 FY13 FY14 FY15 FY16 FY17 (Ind AS) 9 Note: All figures are in INR bn, unless otherwise stated
Strong financial profile (2/2) Operating Profit Return on Invested Capital (ROIC) Operating Profit Operating Profit margin (%) 52.50% 47.90% 19.80% 43.60% 45.20% 17.80% High upfront capex 16.90% 16.30% 16.30% 38.30% towards new greenfield facility in 15.2 14.9 13.2 11.6 Assam 10.0 FY13 FY14 FY15 FY16 FY17 FY13 FY14 FY15 FY16 FY17 (Ind AS) (Ind AS) Shareholders’ Funds 48.5 41.6 33.5 26.6 21.0 FY13 FY14 FY15 FY16 FY17 (Ind AS) 10 Note: All figures are in INR bn, unless otherwise stated
Manufacturing facilities 12 manufacturing locations in India 7 international manufacturing locations UAE Baddi Jammu Egypt Sahibabad ` Alwar Tezpur Pantnagar Newai Nigeria Katni Turkey Narendrapur Silvasa Sri Lanka Nasik Pithampur Bangladesh Nepal 11
Distribution network Urban Rural Factory Factory C&F C&F Super GT Stockist MT Stockist Insti Stockist Stockist Wholesaler Sub Stockist Retailer Retailer Retailer Consumer Consumer Consumer Consumer Distribution reach of 6 mn retail outlets; Cover over 40,000 villages directly 12
Contents Ayurveda – Science of Life Dabur – Overview Business Structure India Business International Business The next growth wave Latest Financials Annexure 13
Business structure Dabur India Ltd Domestic International (70%) (30%) Domestic Others Organic Acquired FMCG (4%) (69%) (31%) (66%) 14 Note: Figures in brackets are based on FY17 revenue
Contents Ayurveda – Science of Life Dabur – Overview Business Structure India Business International Business The next growth wave Latest Financials Annexure 15
Sales by Business Vertical Domestic FMCG – Business Verticals 1 Key categories Revenue Category Contribution Key Brands Domestic FMCG (FY17) Hair Care 22% Healthcare (31%) Foods 19% Health HPC 17% Supplements (50%) Oral Care 16% Foods (19%) OTC & Ethicals 9% Others 17% 16 1. Based on FY17 Revenue
Market leader in 6 categories Leading position in key categories across verticals #Relative Competitive Position 1 #1 #1 #2 #2 #2 #3 #1 #2 #1 #1 #1 Honey Chyawanprash Baby Glucose Hair Oils Oral Care Skin Toilet Cleaners Air Mosquito Juices Massage Care - Fresheners Repellant Oil Bleaches Creams Healthcare Home and Personal Care Foods 17 1. Position basis Nielsen Market Share data MAT Mar’17
Continue to build bigger brands 10 bn+ 1 bn+ 16 brands with turnover of INR 1bn+ with 3 brands which are 10bn+ 18
Business strategy Healthcare Home & Personal Care Foods Leadership in Ayurveda – Ayurvedic / Herbal focus Maintain leadership in Juices • • • scientific evidence & & Nectars category Premiumization & • research Differentiation Leveraging the Fruit equity • OTC portfolio to be scaled associated with the ‘Real’ • Strong innovation agenda • up through innovation & brand Potential to expand in • brand investments Focus on ‘Healthy’ range of • adjacencies within current Doctor advocacy through products • categories Medico Marketing channel 19
Recent Innovations Vatika Enriched Coconut Sani Fresh Real Mocktails Dabur Vatika Shampoo Hair Oil Bathroom Cleaner with Satt Poshan Anmol Jasmine Hair Oil Honitus Hot Sip GlycoDab tablets - Odonil Zipper Ayurvedic medicine 20
Project Buniyaad – Distribution enhancement Enabling Technology Urban Strategy Using technology to track and improve performance Leveraging potential through Channel based approach and automate processes Rural Strategy New Avenues of Growth Split the front line teams into two to increase reach Leveraging the alternate channels of MT and C&C to and frequency – Showing significant positive gains grow at a rapid pace Continue Engagement Portfolio Focus Using initiatives and technology to build and Leveraging split teams for focused portfolio building continuously motivate the trade and front line teams Project Buniyaad achieves its direct reach target of 1 mn outlets Direct Reach – No. of Outlets 1,020,974 916,869 912,332 910,095 Mar-15 Mar-16 Mar-17 Dec-17 21
Project Lead – Doctor advocacy initiative Key Products (Project Lead) Project Lead was initiated in 2015 with an aim to create the Doctor advocacy platform • Building the detailing team – Started with 163 Medical Representatives, which is currently at 178; Dabur Stresscom Dabur Hepano plans to increase to 230 by year end • Both Ayurvedic and Allopathic doctors being covered – Number of doctors increased from 25,000 to 36,000 currently Dabur Honitus Cough Dabur Laxirid Syrup • States covered – Initially Maharashta, UP and West Bengal; Bihar and Orissa have been added in current year • Head of business inducted for Medical detailing and Dabur ImuDab Dabur Lipistat marketing • IT Platform and hand held devices for seamless information flow and detailing support for the medical reps Dabur Woman Dabur Chyawanprash Restorative Tonic 22
Contents Ayurveda – Science of Life Dabur – Overview Business Structure India Business International Business The next growth wave Latest Financials Annexure 23
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