RUCHI SOYA INDUSTRIES LIMITED CORPORATE PRESENTATION ABOUT RUCHI - PowerPoint PPT Presentation

RUCHI SOYA INDUSTRIES LIMITED CORPORATE PRESENTATION

ABOUT RUCHI SOYA INDUSTRIES (RSIL) OVERVIEW OF INDIAN EDIBLE OIL INDUSTRY RSIL’S COMPETITIVE POSITIONING THE WAY FORWARD 2

ABOUT RUCHI SOYA INDUSTRIES (RSIL) 3

Overview of Ruchi Soya Business Mix  One of the largest agribusiness companies in India, with annual turnover of over US$2.7bn in 2008 Edible Oil  The largest producer and supplier 67% of Vegetable Oil and Soya Food in India Vanaspati  Instrumental in India’s Soya 8% De Oiled Revolution Cake  Leading manufacturer of high 23% quality edible oils, bakery fats, and Others 2% Soya foods 4

Despite commodity cycles International prices of major edible oils US$/MT 5

…We have GROWN consistently Consistent revenue growth and has never been in red NET SALES PAT 120,000 1600 10 year CAGR 25% 1400 100,000 10 year CAGR 24% 1200 80,000 1000 Rs.Mns Rs.Mns 60,000 800 600 40,000 400 20,000 200 0 0 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 Note : Consolidated Edible oil and Soya businesses of Ruchi Group into Ruchi Soya Industries Ltd in 2006. 6

Ruchi Soya has come a long way…  Aggregator in highly fragmented edible oil business, with presence across value chain from trading to manufacturing to branding.  Largest player in India’s branded edible oil category (ROCP) accounting for 19% of the Indian market.  Over 2.1 MMTPA of refining and over 2.9 MMTPA of crushing capacities spread over strategic locations (FY08).  Distribution reach covering over 5,83,000 retail outlets.  Strong brand portfolio of Nutrela, Ruchi Gold, Ruchi Star, Mahakosh, Sunrich. Source: Industry 7

Dominance across segments RSIL Market Share 30% 28% 25% 25% Industry is conducive to 20% Ruchi becoming an 20% 17% aggregator 15% 13%  Industry fragmented and 10% inefficient 5%  Virtual absence of integrated players 0% Edible Oil Palm Oil Branded Oil DOC Soya Oil 8

OVERVIEW OF INDIAN EDIBLE OIL INDUSTRY 9

Indian Oilseed Sector…  Indian oilseed sector accounts for –  Domestic turnover of Rs.80,000 Crores (US$ 20bn)  Import and Export trade turnover of Rs.20,000 Crores ( US$5bn)  India during 2006-07 accounted for –  7.4% of world oilseed production.  6.1% of world major meal production.  3.9% of world meals export.  5.8% of world oil production  11.2% of world import of oils  9.3% of world oil consumption Source: Oil World 2007 10

Edible oil consumption – moving up Per Capita oil consumption- in Kg. Total Edible Oil Consumption- in Mn Tonne 11.27 11.4 11.16 11.17 11.2 14,000 12835 12510 12280 11 11366 10820 10.8 10.52 10.6 10,500 10.4 10.15 10.2 7,000 10 9.8 9.6 3,500 9.4 2003-04 2004-05 2005-06 2006-07 2007-08 0 2003-04 2004-05 2005-06 2006-07 2007-08 3 Year CAGR Consumption Pattern 25% Others 20% 24% Palm Oil 20% 32% 15% 10% 10% 8% Cottonseed Oil 7% 4% 5% -1% 0% Rapseed Oil Palm Oil Rapseed Oil Soyabean Oil Cottonseed Oil Others Soyabean Oil 17% 20% -5% Source : Industry 11

…and move up even further In MMT Total Demand Domestic Oil Supply Total Edible Oil Imports 25 21 20 16 15 13 12 10 10 10 8 8 6 6 6 6 4 5 4 1 0 1996 2000 2006 2010E 2015E Source : Rabo Bank, Industry Over 1/3rd of demand met through imports 12

Industry – need for consolidation  Fragmented and Inefficient industry:  15000 Oil mills, 600 Solvent extraction units ,Over 650 refining units and 250 vanaspati units  More than 50% of the players with output less than 18000 MT/annum.  Capacity utilization lower than 30%  Per tonne operation cost more than double  Virtual absence of integrated players, unlike globally: crushing, extraction and refining capacity owned by different entities  Consolidation imminent in the Indian industry  Better capacity utilization  Funds for higher investments  Well equipped to service the market Ruchi Soya Accounts for around 13% of Indian Edible Oil Consumption 13

A shift – ‘Loose’ to ‘packaged’ Factors Driving the Shift Increasing attention to health and hygiene Increasing Presence of Industry-wide branded edible- Organized Retail Channel oil sales expected to grow at 15% annually over the next few years versus 6% annually in the Increasing Affordability last few years Government Rules Favouring Packaged Oil Source: Industry 14

Need of the hour… Global scale capacities Shift from unbranded / unorganised to branded / organised Movement towards Value add And the most important – Indian industry needs a CONSOLIDATOR 15

Ruchi Soya – right up there 16

RSIL’S COMPETITIVE POSITIONING 17

Asset Investment ahead of time… Expansion – Multiple increase in capacity in 6 years Capacities (‘000 MTPA) 2002 2008 Multiplier Solvent Extraction 600 2893 5 X Refinery 180 2121 12 X Vanaspati / bakery fats 112 470 4 X TSP 24 152 6 X 18

Strategically located Plants… Shriganganagar Baran Guna Kota Shujalpur Ruchi balances proximity to raw materials Gadarwara Indore Kandla (cultivating states and Jabalpur Haldia ports) with proximity to Nagpur Patal Ganga markets Chennai Crushing Refining Mangalore 19

From supply chain to manufacturing Sales Break up Manufacturing Supply chain 120,000 100,000 80,000 Rs.Mns 60,000 40,000 20,000 0 FY03 FY04 FY05 FY06 FY07 FY08 Note : Consolidated Edible oil and Soya businesses of Ruchi Group into Ruchi Soya Industries Ltd in 2006. Share of Manufactured products up from 46% to 77% in 5 years 20

Strong Brand portfolio provides an edge  Well-established branded portfolio  Nutrela: A premium Umbrella brand positioned on Health and Wellness platform.  Ruchi Gold / Ruchi Star: Mass segment brands  Sunrich / Mahakosh / Mandap: “Fighter brands”  Increased focus on healthy food products – Nutrela N’rich 21

… which is reflected as 35,000 Branded Sales 30,000 7 year CAGR 30% 25,000 20,000 Rs.Mns 15,000 10,000 5,000 0 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 Note : Consolidated Edible oil and Soya businesses of Ruchi Group into Ruchi Soya Industries Ltd in 2006. Share of Branded sales in Total sales grew from 19.6% in FY01 to 29.5% in FY08. 22

Strengthening leadership ROCP market share %(volume) RUCHI SOYA INDS ADANI WILMAR CARGILL FOODS 25.0 20.8 19.4 19.6 19.0 20.0 19.7 19.6 18.6 18.7 18.5 18.1 17.8 17.5 16.2 16.1 15.8 15.7 15.6 15.4 15.2 14.4 14.7 15.0 15.0 14.3 14.4 12.7 12.3 12.0 11.6 11.4 11.3 10.3 10.2 10.0 9.7 9.7 9.5 9.4 Leading the market with widening gap 5.0 0.0 APR07 MAY07 JUN07 JUL07 AUG07 SEP07 OCT07 NOV07 DEC07 JAN08 FEB08 MAR08 ROCP – Refined Oil in Consumer Pack Source:AC Nielsen 23

Strengthening leadership ROCP market share % (value) RUCHI SOYA INDS ADANI WILMAR CARGILL FOODS 25.0 20.0 19.2 18.7 17.8 17.8 17.5 17.5 17.4 17.4 16.6 16.9 16.0 16.6 16.4 16.3 16.1 16.8 16.0 16.2 15.9 16.0 16.2 15.0 15.7 15.0 13.2 14.9 12.6 12.3 12.0 11.6 11.9 10.4 10.3 9.4 9.6 10.0 9.4 9.4 Leading the market with widening gap 5.0 0.0 APR07 MAY07 JUN07 JUL07 AUG07 SEP07 OCT07 NOV07 DEC07 JAN08 FEB08 MAR08 ROCP – Refined Oil in Consumer Pack Source:AC Nielsen 24

Reflecting in numbers… FY 2005-06 FY 2006-07 % Increase FY 2007-08 % Increase Rs.Mn Rs.Mn Rs.Mn Net Sales 75404 86277 14% 110380 28% EBITDA 2338 2982 28% 4305 44% PBT 1196 1564 31% 2537 62% PAT 828 1007 22% 1592 58% Performance reflects the journey 25

THE WAY FORWARD 26

New initiatives… • Leverage Organisation Strengths. • Brand Architecture. Scale-up the Branded Portfolio • Nutrela Meal Clock. • Nutrela Brand Portfolio – The Journey. 27

Leverage Organisation Strengths  Large existing loyal consumer base – pan India presence  Multi – locational manufacturing; contract production options  Extensive field sales and trade distribution network  Can access international technology  Capable of investing in demand generation 28

Brand Architecture Brand Role in Portfolio Borrows from Nutrela Builds (for itself and for the portfolio)  Mother Brand  Visibility, Entry Nutrela (Driver/ Lead Brand)  Basic Nutrition Values  Main Meal Brand  Volume driver  Endorsed brand  Nutrition Equity  Energy, Activeness N’rich  Beverage & Snack Brand  Credibility,  Youthfulness, Premium- Recognition, Heritage ness, Modernity  Image & Volume Driver  Freshness, Smart factor, Novelty, Value added  Endorsed brand  Soy Equity  Approachability Soyumm  Credibility,  Soy Food Brand  Health Equity Recognition, Heritage  Image Driver 29

Nutrela Meal Clock Soyumm Breakfast N’rich Nutrela Main meals Indulgence Soyumm Snacks Soyumm Product Categories envisaged : fortified healthy edible oils ; snack foods ; milk & fruit beverages ; intermediates (ready to use) 30