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Hindusthan National Glass & Industries Ltd. CORPORATE PRESENTATION

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Presentation on theme: "Hindusthan National Glass & Industries Ltd. CORPORATE PRESENTATION"— Presentation transcript:

1 Hindusthan National Glass & Industries Ltd. CORPORATE PRESENTATION

2 Disclaimer Certain statements in this communication may be ‘forward looking statements’ within the meaning of applicable laws and regulations. These forward-looking statements involve 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 developments that could affect the Company’s operations include changes in the industry structure, significant changes in political and economic environment in India and overseas, tax laws, import duties, litigation and labour relations. Hindusthan National Glass & Industries Limited will not be in any way responsible for any action taken based on such statements and undertakes no obligation to publicly update these forward-looking statements to reflect subsequent events or circumstances. 2 2

3 Table of Contents Company Overview Business Overview Industry Snapshot
Operating and Financial Performance Annexures 3 3

4 Company Overview 4 4

5 Company overview Dominant position Consumption Ancillary
Market share of ~ 55% in the container glass segment Installed TPD capacity in India (2,925 MT) and Germany (320 MT); Planned capacity expansion to ~6,765 TPD by FY17 Consumption Ancillary Diversified end user segment including Liquor, Beer, Beverages, Food, Pharmaceuticals and others Pan India Presence Manufacturing facilities in 6 locations across India, 7th facility will start by April, 2012 Additionally, international manufacturing footprint through its 100% subsidiary HNG Global GmbH, Germany Competent management Strong management with vast experience and domain knowledge Successful history of acquiring loss-making units and turning them around Well established customer relations Six decades of presence in the industry has enabled the Company to develop long standing customer relations Strong Balance Sheet In a capital intensive industry, the Company has been able to maintain a comfortable long term debt/ equity ratio 5

6 Corporate Milestones First 30 TPD plant commissioned in 1952 Second 90 TPD plant commissioned in 1964 Acquired 700 TPD facility in Owens Brockway India Ltd, a subsidiary of Owens Illinois, USA. Company renamed as Ace Glass Rated Best Indian Glass & Ceramics Company by Dun & Bradstreet Work on 7th plant at Naidupeta (650 TPD) initiated – operations to commence by Q1 FY13 Ace Glass Containers merged with HNG 1952 2001 2002 2005 2006 2007 2009 2010 2011 Capacities expanded to 1,100 TPD Acquired 320 TPD loss making glass division from L&T at Nashik Established float glass plant in Halol under HNG Float Glass Acquired 180 TPD Neemrana unit of Haryana Sheet Glass Nashik plant to add capacity of 650 TPD by Q4 FY12. Acquired assets of Agenda Glas AG in May 2011; 320 TPD facility at Gardelegen, Germany 6 6

7 Corporate Structure Hindusthan National Glass & Industries Ltd.
Consolidated net revenues: Rs. 15,678 millions. Standalone net revenues: Rs. 15,525 millions. 47.4% 100% 100% 100% Glass Equipment (India) Ltd. Quality Minerals Ltd. HNG Global GmbH HNG Float Glass Ltd. (HNGFL) Net revenues: Rs. 299 millions. Capital Goods & Spares Supplier to Glass Industry Net revenues: Rs. 10 millions. Mineral Supplier to Glass Industry Net revenues: Rs. 2,948 millions. Manufacturer of Float & Processed Glass Acquisition of assets of Agenda Glas AG Note: All revenue figures are for FY HNG Global GmbH was acquired after March 31, 2011. 7 7

8 Business Strategy Capacity Expansion Expanding product portfolio
Acquired and turned around four loss making units over the last nine years Planned organic expansion to ~ 6,765 TPD by FY17 Expanding product portfolio Presence across key user industries – liquor, beer, pharmaceuticals and food Capitalizing on opportunities in the high growth float glass industry Adapting new technology Introduced Narrow Neck Press and Blow (NNPB) technology, first in India Sustained competitive advantage through product optimization and continuous innovation Increasing production of light weighted bottles to enhance margins Backward integration Captive power plant to improve cost efficiencies (Existing and Proposed) Silica mining to support raw material supply chain (Proposed) Manufacturing of glass machines & spares in 100% subsidiary GEIL International Footprint Gained European presence, one of the largest markets for food and alco-bev industries Access to technological strength and production processes 8

9 Business Overview 9 9

10 Pan – India Presence Rishikesh Bahadurgarh Chennai Delhi Neemrana Vadodara Kolkata Puducherry Rishra Nashik Mumbai Hyderabad Naidupeta Bengaluru Marketing Offices Container Glass Plant Locations Upcoming Greenfield Mega Project Upcoming Brownfield Mega Project (Nashik) Float Glass Unit HNG, the largest container glass manufacturer in India has a manufacturing capacity of 2,925 tonnes per day Multi-locational production facilities enable the Company to: Lower landed cost to customers Provide JIT supplies Cater to key customers across India GEIL Note : Further, the Company is setting up greenfield manufacturing facilities in new locations in West Bengal and Rajasthan. The total capacity is expected to grow to ~6,765 TPD by FY17 through Greenfield and Brownfield expansions in India. 10 10

11 International Presence
Plant location: Gardelegen, Germany Capacity: 320 TPD Gardelegen 11

12 HNG Global GmbH, Gardelegen, Germany
One of the most modern production facilities in Europe, with 320 tpd capacity. HNG Global GmbH, is located closed to the regional raw material suppliers with easy and economic access to all key RM’s. The Plant is ideally located for deliveries throughout Germany and to adjacent European Countries. Company has 147 FTE, the average age of employees is 37 years, with 50% of the workforce below the age group of 35 yrs. Germany is the largest market for Container Glass in Europe, with a share of ~ 20%. Company’s technological edge can also be back pedalled in HNG’s Indian operation, as Germany is always considered as two steps ahead in terms of technology, from the rest of the World. 12

13 New Furnace(N) / Rebuild (R)
Expanding Scale Location Present Capacity Expanded Capacity To be Commissioned by New Furnace(N) / Rebuild (R) RSR Furnace 1 225 280 Already started R RSR Furnace 2 240 250 RSR Furnace 6 330 450 EAST Furnace - 650 N BGR Furnace 3 BGR Furnace 4 275 270 BGR Furnace 5 180 NMR Furnace 200 RSK Furnace 2 140 RSK Furnace 1 290 RJSTHN Fur 1 RJSTHN Fur 2 RJSTHN Fur 3 350 PDY Furnace 1 360 550 NSK Furnace 1 355 545 NSK Furnace 2 640 1st March, 2012 Naidupeta Gardelegen 320 Acquisition TOTAL 3,245 6,765 Present capacity of 3,245 TPD with proposed expansion to ~ 6,765 TPD by FY17 13 13

14 Caters to customers across segments
Strong customer relationships PHARMACEUTICALS BEER LIQUOR FOOD SOFT DRINKS Caters to customers across segments 14


16 HNG Float Glass Overview
Commenced operations in February 2010 Established a 600 TPD Greenfield Plant at Halol, Gujarat Accomplished 100% capacity utilization in the first year of operations One of the fastest growing Float Glass companies Achieved pan-India market share of 21% in clear glass and became industry leader in the west Indian market with 30% market share in clear glass in its first year of operations Extensive and expanding pan India dealer network Created a strong distribution base with over 928 dealers spread across India Diversification within the glass sector Leveraged six-decade experience in glass manufacturing Synergies in technology – Significant part of float glass manufacturing process is similar to that of container glass Economies of scale achieved in raw material procurement 16 16

17 HNG Float Glass Overview
Future growth plans Setting up of a Mirror line, High performance Low E glass, Two float lines at Halol (Gujarat) & South India Second Float Line at Halol for 900 TPD for architectural glass by FY14 Setting up additional 1,200 TPD float glass Capacity for architectural quality in South India by FY16 Plan to commission production facility for Soft coated High performance Low E Glass by start of FY14 Industry growth drivers – low penetration of Glass and boom in the end user industry to drive growth Nascent industry in India with just 8 float glass lines compared to 246 in China Indian Float Glass industry has been growing at c.20% CAGR over the last three years India’s total installed capacity for float glass is ~ 4,700 TPD which results into saleable production of 3,840 TPD Low per capita consumption of Float Glass in India of 0.8 kg as compared to 12 kg in China and 10.4 kg in USA 17 17

18 Industry Snapshot 18 18

19 Global Packaging Industry
As per World Packaging Organization, the global packaging industry at present is estimated to be USD 425 billion in revenues, with ten year historical growth at ~ 3.1% CAGR, expected to be USD 597 billion by 2014 Projected to grow at ~ 3.5% CAGR in the next five years mainly driven by growth in emerging markets (Asia Pacific region) Source: Owens-Illinois, Inc. - Investor presentation, March 2010 19 19

20 World glass container per capita consumption
Indian Glass Packaging Industry At US$ 14 bn, Indian packaging industry has been growing at ~ 15% over the last few years Expected to accelerate further with increasing urbanization, growing middle class and expansion of modern retail Indian glass container market stood at US$ 1 bn plus in FY10 with a growth of ~ 12% Entry barrier owing to capital intensive nature Top 3 players are HNG, AGI Glaspac and Piramal Glass Low per capita glass container consumption of 1.5 kg in India as compared to 27.5 kg. in US and 10.2 kg. in Japan Strong economic drivers for end-user segments (liquor and beer, pharmaceuticals, food, cosmetics, etc.) World glass container per capita consumption (Kg) 20 20


22 Operational & Financial Snapshot
22 22

23 Operational Overview Key Highlights 23
Firm domestic demand driven by growth in end user industries - liquor, beer, pharmaceuticals, foods and carbonated drinks Manufacturing facilities located across India provide an edge over peers who have regional presence Pan India distribution network Implementation of advanced technology enables improved cost efficiencies 23 23

24 Production - Capacities FY11-12
Volume Mix -FY11 End user segment Geography Production - Capacities FY11-12 1 Others include soft drinks 24 24

25 Financial Performance
Net Turnover EBITDA PAT EPS (Rs. / share) All figures stated in Rs. millions on a standalone basis 25 25

26 Particulars (Rs. million) Half Year ended September, 2011
Balance Sheet Particulars (Rs. million) Half Year ended September, 2011 Year ended March, 2011 Year ended March, 2010 Share Holders Funds 12,105 11,661 10,428 Loan Funds 10,571 63,95 5,657 Deferred Tax Liabilities 712 697 TOTAL LIABILITIES 23,388 18,769 16,782 Net Block + Capital Work-in-progress 17,560 13,845 11,438 Investments 2,281 1,775 1,471 Net Current Assets 3,547 3,149 3,873 TOTAL ASSETS All figures stated in Rs. millions on a standalone basis 26 26

27 Key Balance Sheet Ratios
ROCE 27 27

28 H1 FY 2012 - Financial Highlights
Profit & Loss Statement Snapshot Particulars (Rs. million) H1 FY2012 H1 FY2011 Shift (%) Total Income 8,557 7,366 16.2 EBIDTA 1,512 1,494 1.2 Margins 17.7% 20.3% Depreciation 551 494 11.5 Interest 420 242 73.6 Profit Before Tax 541 759 -28.7 6.3% 10.3% Tax expense 112 173 -35.3 Profit After Tax 429 587 -26.9 5.0% 8.0% EPS (in Rs.) 4.91 6.72 All figures stated in Rs. millions on a standalone basis 28

29 Annexures 29 29

30 Shareholding Pattern Particulars % Shareholding
(as on September, 2011) Promoters 69.98 Public Shareholding Insurance Companies 0.31 Bodies Corporate 3.93 Financial Institutional Investors 7.28 Individuals & Others* 18.50 Total 100.00 30.02 * Includes 16.76% held as Treasury Shares in the Company Total 87.3 million shares Listed at: National Stock Exchange (NSE) - HINDNATGLS Bombay Stock Exchange (BSE) Calcutta Stock Exchange (CSE) 30 30

31 Ratings, Rankings & Accreditations
Business Today Ranking (Out of 500 top listed corporates, as of October, 2011) In terms of Average Market Capitalization – 368th Rating by CARE (Credit Analysis & Research Ltd.) Long Term credit rating of AA+(implying high safety for timely servicing of debt obligations and carrying very low credit risk). Short Term credit rating of PR1(+), being the highest grade (implying the lowest credit risk). Rated as the best Indian Company in the Glass & Ceramics category by Dun & Bradstreet in years 2009 and 2010 Accredited with ISO 9001:2008 certification, ensuring stringent quality standards and ISO for food and safety Rated at No.35, out of the best 500 companies by Inc.India (Comprehensive ranking of India’s best performing mid-sized companies) in their Sep-Oct, 2010 issue. 31

32 Thank you Hindusthan National Glass & Industries Ltd. (HNG)
For further information please log on to or contact: Laxmi Narayan Mandhana (CFO) HNG Tel: Anoop Poojari / Dipti Yadava Citigate Dewe Rogerson Tel: / 1218 / 32

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