walchandnagar corporate presentation
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Corporate Presentation
January 2010
Walchandnagar Industries Ltd. (WIL)
Disclaimer
This presentation has been prepared by Walchandnagar Limited (the “Company”) solely for providing information about the Company. This presentation is confidential and may not be copied or disseminated, in whole or part, in any manner.
This presentation has not been approved and will not be reviewed or approved by any statutory or regulatory authority in India or by any Stock Exchange in India and may not comply with all the disclosure requirements prescribed thereof. This presentation may not be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this presentation is expressly excluded
This presentation has been prepared by the Company based on information and data which the Company considers reliable. However, no representation or warranty, express or implied is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of such information or opinions contained herein. Neither the company nor any of its respective affiliates, advisers or representatives, shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with this presentation.
The information contained in this presentation is only current as of its date. Certain statements made in this presentation may not be based on historical information or facts and may be “forward-looking statements”, including those relating to the Company’s general business plans and strategy, its future financial condition and growth prospects, and future developments in its industry and its competitive and regulatory environment. Actual results may differ from these forward-looking statements due to a number of factors, including future changes or developments in the Company’s business, its competitive environment, information technology and political, economic, legal and social conditions in India and worldwide. The Company undertakes no obligation to update forward looking statements to reflect events or circumstances after the date thereof.
This presentation and any information presented herein are not intended to be and shall not be construed as an offer to sell or solicitation of or an offer to buy the Company’s equity shares or any of its other securities and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale is unlawful.
The Company may alter, modify or otherwise change in any manner the content of this presentation, without obligation to notify any person of such revision or changes.
Contents
Key Highlights
WILWIL-- An OverviewAn Overview
Key Financial Information
Annexure - Select Turnkey EPC Projects Completed- Select Components Manufactured by SPD
Pedigree of Walchand Group
4
One of the renowned industrialist of pre-independence India, who promoted and established
various business ventures in various sectors
Ranging from automobile manufacturing, civil engineering, construction of dams, bridges,
barrages and hume pipes, aircraft manufacturing, ship building, to maritime shipping
SETH WALCHAND HIRACHAND(1882 – 1953)
Founder
“Walchand Hirachand was a dreamer, a visionary, a great builder, a great leader of industry. Above all, he was a patriot, and in his own way, he was an inspiring leader of our struggle for freedom. I salute his memory.”
“When we celebrate the life of an entrepreneur like Walchand Hirachand, we must draw the correct lessons from his life. The lesson I draw is that the ultimate spur to growth and development is individual creativity and enterprise”
Dr.Manmohan Singh, Prime Minister Of India
Founder…Hindustan Aircraft Company…Pioneer in Aircraft Manufacturing
Founder…Hindustan Shipyard Vizag…Pioneer in Shipbuilding Industry
Founder… Scindia Steam Navigation Company…Pioneer in Maritime Shipping
Established many new venturesIn various core sectors like
Automobile Civil EngineeringConstruction of Dams, Bridges,
Barrages & Hume Pipes`Founder…Walchandnagar Industries
Ltd (WIL)…One of India’s leading heavy engineering and project
execution company
WIL…Building Engineering Excellence For Over 100 Years
5
WIL is one of India’s leading heavy engineering and project
execution company with a strong history
Diversification across products, sectors and geographies through its
business offerings
Manufacturing and EPC- Focus on Energy, Mining & Minerals,
Cement, Sugar etc.
Special Products- Focus on Defense, Nuclear Power and
Aerospace
Engineering- Walchand Technology Group (WTG)
Other Businesses- Foundry, Precision Instrumentation,
Gears (for variety of applications)
Continued strong engineering & project management capabilities,
backed by its technological strength and an able work force
Evolution of the Years…
Shareholding Pattern (as on Dec ’09)
Poised for strong growth in the years to come
Professionally managed with growth oriented corporate structure
Evolved into a multi divisional, multi location company
Became among the first few Indian companies to manufacture critical components for a nuclear power project managed by BARC and to be associated with ISRO for India’s space research programme
Commenced the heavy engineering & machinery manufacturing business in early 1960s
Initial business of an integrated sugar manufacturing at Walchandnagar (near Pune)
Changed its name to Walchandnagar Industries Ltd. in 1944
Incorporated in 1908 under the name Marsland and Price Company Ltd.
Founded by the visionary industrialist, Seth Walchand Hirachand
5.55LIC of India
Name % Holding
Oriental Insurance Company Ltd. 1.54
Key Institutional Shareholders
Other Public 37.5%
Promoter & Promoter Group
55%
Institutional 7.5%
A Snapshot
Organization Structure
6
Chakor L. DoshiChairman
Manufacturing & EPC Special Products Division (SPD) Other Businesses
EnergyG.S.Prakash - Boiler
Elias K Ponodath - Energy
R. Kumar - Utility Boiler
M.J. Devis - Turbines
Mr. J. L. DeshmukhMD & CEO
Key Corporate Functions
WIL has created sufficient management bandwidth to cater to all its business initiatives and growth plans
Overall Management
Business Offering
Key V
ert
icals
& P
ers
on
nel
Mr. Chirag DoshiMD
Minerals & MiningArvind ShoreS.K. Gulati
CementP.C. Bhagwat
Others:Dr. Janakiram -Oil & GasNew Business Ventures – L. RanganathanG.S.Prakash – Sugar & Centrifugal
DefenceP D Ganorkar
NuclearS S Mahabaleshwarkar
AerospaceS V Shahade
FoundryKushal Saha
PrecisionInstruments
A.B Kamlapur
Finance & AuditV R JoshiM H Purwat
Strategic Planning (SP) & Market Research (MR
SS Gangavati
MaterialsP K Mahadevan
HR &Establishments
J N Nandurkar Umesh Joshi
Defense , Hydrocarbons & Gear
Vice Adm. (Retd) S.K Krishnan
Aerospace & Nuclearpower
V.M Parthasarthy
Engineering Excellence
WTGVice Adm (Retd)N M Nadaph
GearsS.K.Dasgupta
ManufacturingV.G. Ratnaparkhi
ITS.R. Deshmukh
Manufacturing & EPC Business
7
Design, engineering, procurement and construction of mineral processing projects and bulk material handling
Projects include calcination plants, plant and machinery for extraction of metals,mine backfill projectsetc.
MoU with Continental Conveyor Ltd. in mining & materials handling systems
Minerals & Mining
Manufacturing of industrial boilers and steam generators,
Technology from Foster Wheeler USA
Power plant projects on a turnkey basis
Executed captive as well as independent power projects
Currently has capacity to execute power projects upto 100 MW
Energy
Design, manufacturing and supply of complete cement projects up to a capacity of 1 MTPA on turnkey basis
Executed over 70 cement plant projects at various domestic and international locations
Tie up with ATEC Austria to enable in bidding for larger size projects and in new geographies
Range of products include ball mills, slide shoe mills, kilns etc
Cement Others
Providing products and services for onshore and offshore oil and gas projects
Involved in structural fabrication, design, manufacture and supply of equipment
Conceptualizes, designs, implements and commissions turnkey sugar projects, batch and continuous centrifugal machines
Refer Annexure
Special Products Business
8
Associated with the Ministry of Defence, for more than 35 years
Recently supplied critical core equipment for “INS Arihant”
Major Equipments supplied for defense applications include combustion chambers, missile casings, air booster casing static and mobile launchers etc
Defence
Accredited with pre-qualifications from the BARC and NPCIL for supplying nuclear components
Undertakes site installation and integration activities of nuclear power reactors
Supplying major core equipment for various nuclear power plants for both 235 MWE and 500 MWE projects
Nuclear
Associated with ISRO since its inception, for manufacturing critical components for space research projects
Company has manufactured and supplied booster motor casings and nozzles for the satellite launch vehicles, including the ASLV, PSLV and now GSLV
Components produced have been used in the launching of satellites such as the ‘INSAT’series
Aerospace
Refer Annexure
Handles exotic materials such as maraging steel, cladded steel, inconel etc.
Engineering and Other Businesses
9
The group focuses on the research & development of engineering applications for the potential business opportunities being pursued by the Company
Employs 70 professionals…qualified engineers in several disciplines of engineering
Provides comprehensive Design and Engineering services several fields such as Nuclear Power, Aerospace, Thermal, Non-conventional Energy etc.
Walchand Technology Group (WTG)
Operates a grey and ductile iron foundry with capability to handle highly intricate castings for specialized applications
Key business focus on wind mill, industrial machinery, automotive and oil & gas sectors
Range of products include casting in grey cast & ductile iron, castings for manufacture of automotive dies etc.
Ability to handle single piece weight of 13 tonnes of grey cast iron and 8 tonnes of ductile iron
Foundry
Manufacturer of precision instruments such as pressure gauges, temperature gauges, sector mechanisms etc.
Key industry focus on automotive, wide range of process industry, power projects etc.
Used in variety of industrial applications such as CNG kits, refineries, air-conditioning, refrigeration equipment etc
Precision Instruments
Office and Plant Locations
10
Regional Offices- Delhi, Kolkata, Hyderabad and Chennai
Precision Instruments Division- Dharwad
Foundry- Satara
Marketing & Projects Office- Pune
Walchand Technology Group- Pune
Heavy Engineering Manufacturing Plant- Walchandnagar
Registered Office- Mumbai
Oil and Gas Division- Navi Mumbai
Details of offices and plant locations
Karnataka
Tamil Nadu
Andhra Pradesh
West Bengal
Maharashtra
Delhi
WIL’s manufacturing facilities are based out of Mahrashtra and Karnataka... Presence in key cities through its
regional and marketing offices
Select Facilities at Walchandnagar Plant
Area under crane: 56,000 sq mtr
Fully equipped with modern manufacturing facilities- CNC horizontal and vertical boring machines with multi axis control, lathes,
milling machines, gear cutting & grinding machines etc
Sophisticated Automatic Welding Systems capable of precision welding of exotic materials
Dust Free Halls for critical assembly and precision welding related to Aerospace, Defence and Nuclear equipment
Large sized Furnaces with Data Acquisition Systems
Optical tooling & measuring instruments for precision measurements
Material handling capacity upto 150 tonnes
Large capacity turning facility Heavy machine shop area
Heavy duty vertical boring machineHeavy equipment fabrication area
Birds eye view of Walchandnagar Plant
Key Highlights
11
Select facilities
Select Business Achievements of WIL
12
Independent power project based on municipal solid waste in India
Amongst the first few exporters of a complete cement plant
Indigenously built sugar project in India way back in 1960s
Amongst the first few exporters of sugar machinery and complete turnkey project from India
Manufacturer of …
Critical components for nuclear reactor
Main gear boxes for Indian built navy frigates
Components for satellite launch vehicle for ISRO
Critical components for 235MWE and 500 MWE nuclear power project
One of the largest optical telescope in India
Major critical components for India’s first mission to moon “CHANDRAYAAN”
Critical core components for “INS ARIHANT” India’s first nuclear submarine
Technology Absorption Award From Govt. of India
Recognition and Accreditations
13
Indian Nuclear Society “ Industrial Excellence Award” for the year 2006
Best Performance In Exports on Number of Occasions
Excellent Employee Relation Award from Govt. of Maharashtra
Corporate Social Responsibility (CSR) Practices by WIL
The Walchandnagar Township
Named after the founder, Walchandnagar is a well designed township having all
civic amenities
Spread over 157 acres of land which includes 50 acres of factory area
A cosmopolitan set-up with a population of approx. 15,000
Well established infrastructure
Runs primary schools in each Agriculture Estate and a high school
established in Walchandnagar
A 70 bedded modern hospital
Sports facilities
Senior citizen park, children play park
Banks/ATM centers etc.
CSR activities practiced by WIL way back since 1934…
14
WIL has initiated, implemented and actively practices many welfare activities for the society
Contents
Key HighlightsKey Highlights
WIL- An Overview
Key Financial Information
Annexure - Select Turnkey EPC Projects Completed- Select Components Manufactured by SPD
WIL- Key Highlights
16
Successful track record in Indian nuclear, defense and aerospace…area witnessing
huge traction
Benefits of experienced management team
Strong order book…increased visibility and
momentum for the future
An end to end turnkey solutions provider…ability to provide
manufacturing, engineering and construction services
Execution strength & capabilities backed by marquee partnerships
3
2
1
5
4
1. An End to End Turnkey Solutions Provider
17
WIL’s presence in diversified yet synergistic businesses makes it a successful integrated turn key solutions provider
Offers state of the art manufacturing facilities
Ability to manufactures diverse range of products
Industrial boilers, material handling equipments, critical and core equipment for aerospace, defense and nuclear power business, core equipment for cement plant,gear boxes etc.
Total manpower of 1,866 managerial and skilled workers
Offers complete in-house basic, manufacturing & detail engineering services
Ability to provide process system design, plant layout design, analytical studies and system integration
Over 370 qualified and experienced engineers
Offer turnkey projects for independent power projects & cement plants sugar plants boilers and steam generating plants
EPC projects for mining, bulk material handling, mineral processing, oil & gas sector
Significant number of turnkey/semi turnkey/EPC projects completed
From Manufacturing…From Manufacturing…
To Design & Engineering…To Design & Engineering…
…To Execution…To Execution
2. Successful Track Record in Indian Nuclear, Defense & Aerospace
18
.....
Associated with the Ministry of Defense (GoI) for more than 35 years
Major equipments include combustion chambers, missile casings, air booster casing static and mobile
launchers, Karthik bridges etc.
Supplied critical equipment for “INS Arihant” India’s 1st ever indigenously built nuclear submarine
Associated with the Department of Atomic Energy (GoI) for over four decades now
Pioneer in the private sector to manufacture dump tanks, fuel magazines and moderator heat exchangers
Supplies core equipment such as calendria, end shield, heat exchangers etc. for various nuclear power
plants for 235 MWE and 500 MWE projects
Recently awarded a EPC piping contract for a 700 MW power project by NPCIL
Associated with ISRO for over three decades now
Supplied certain critical components for ISRO’s Polar Sattellite Launch Vehicle and the ‘2008 Chandrayaan
Mission’, India’s maiden moon mission
Defense
Nuclear
Aerospace
Indian nuclear, defense & aerospace is witnessing huge traction…WIL plans to strengthen its position in
the above high potential areas
3. Strong Order Book…Visibility and Momentum for the Future
19
Mfg. & EPC63%
SPD27%
Other Businesses
10%
Sept 09- Order Book Break Up (INR 14,632 mn)Growth in Order Book (INR mn) over the years…
WIL’s execution strength and capabilities have resulted in continued growth in order book
Consistency in providing quality output…validated by zero cancellations of orders in the last two years
Focus on strengthening its ability to bid for larger sized power and cement projects
Focus on garnering larger market share in defense, nuclear and aerospace segments…potential high growth areas
4,500
10,000 9,687
12,195
14,632
Sep-05 Sep-06 Sep-07 Sep-08 Sep-09
CAGR (05-09): ~34%
WIL’s strong order book with a average tenure of 18-20 months...an assuarnace for future revenue growth
4. Strong Execution Capabilities Backed by Marquee Partnerships
Continental Crushing and Conveying Inc
Technical assistance in mining and bulk crushing related activities
Construction Management Capabilities
Dedicated separate in-house construction management team… qualified
engineers in the field of mechanical, electrical, instrumentation
Completed large number of projects on turnkey/ semi turn key / EPC basis
Engineering Capabilities
Ability to provide designing, detail engineering to system integration
…variety of design softwares available
Over 370 experienced engineers and technical staff
Project Management Capabilities
Project manager for every project
Well versed in modern project management tools
Large support base of prequalified partners
Select Technology Partnerships...
20
WIL leverages its inhouse core skill sets and competencies, supported by marquee global partnerships, to address
a wider section of industry and end applications
Manufacturing Capabilities
Fully equipped modern manufacturing facilities at Walchandnagar…ability to
manufacture diverse range of products, handle variety of raw material and
capability in precision welding, fabrication and machining
Boilers, material handling equipments, gear boxes, core & critical
equipments for special products and cement businesses
Magotteaux International
Technical assistance mining, cement and other related engineering activities
A-Tec Production Services GmBH
Products and services relating to the cement industry
Foster Wheeler North America Corporation
Technology relating to manufacture of high pressure steam boilers
Holds M.S. in Operations research & Industrial Engineering from U.S.A
Renders valuable advise to the company in the matters of strategic planning, organisation building, new
business initiatives etc.
Holds the position of chairman since 1998 before that he has served as MD of the company for 10 years.
Holds board position in other Indian public limited companies and private limited companies
Holds a bachelor of Engineering (Mechanical)
Joined WIL in 2004 as executive director and currently serves as MD & CEO of the company.
Worked for more than 30 years at Cummins India Ltd, with long stint on various board positions including Managing
Director
The Corporate management is supported by a strong team involving professionals with long standing
experience in several fields
5. Key Management Team - Strengths and Accomplishments
21
Holds B.A (Economics) from University of Michigan, USA and M.B.A. from INSEAD Institute Paris
Managing Director of WIL since November 25,2007.
Extensively worked on various growth initiatives, business development and exploring new business ventures for WIL
Chakor L. Doshi
Chairman
Chirag C. Doshi
Managing Director
J. L. Deshmukh
Managing Director & CEO
V. R. Joshi
Chief Financial Officer
Qualifications include BCom and CA
Worked in several companies such as Bharat Forge Ltd., DGP Hinoday Industries Ltd.
Track record of raising significant funds through domestic & international sources, Mergers & Acquisitions,
Investments & Foreign Exchange risk management
Strategy Going forward…
22
Focus on attaining prominence in EPC
Deeper engagement in Nuclear Power Business
Building Engineering Excellence
Leverage core strength to address wider cross section of industry and end application
Continuous up gradation in skill sets in technology, project management and people capability
Move up the value chain in offering:
— High pressure boilers and large turnkey plants
— Large capacity cement plants
WIL is already a recognized supplier of core nuclear power equipment
Nuclear power segment has significant potential growth opportunities
— India is expected to increase nuclear energy collaboration with US and other countries
Leverage the present position to strengthen future growth
Establishment of WTG, a dedicated engineering centre with 70 qualified engineers in diverse applications
Focus on research in engineering field for existing and potential business areas being pursued by the company
Contents
Key Highlights
WIL- An Overview
Key Financial InformationKey Financial Information
Annexure - Select Turnkey EPC Projects Completed- Select Components Manufactured by SPD
Financial Performance Over The Years
157
273
634722
529
10.1%10.3%9.9%7.6%
6.0%
Sep-05 Sep-06 Sep-07 Sep-08 Sep-09
EBITDA % Growth
CAGR (FY05-09): ~35%
PAT (INR mn) & PAT Margins (%)
77133
356
234
398
4.4%5.7%5.6%3.7%
2.9%
Sep-05 Sep-06 Sep-07 Sep-08 Sep-09
PAT % Growth
CAGR (FY05-09): ~32%
EBITDA (INR mn) & EBITDA Margins (%)
2,615
3,601
6,3747,002
5,249
Sep-05 Sep-06 Sep-07 Sep-08 Sep-09
Total Income (INR mn)
CAGR (FY05-09): ~19%
Networth (INR mn) & D/E (x) (1)
24
Note: WIL follows September year end
1,292
2,291
921
2,100
803
0.4 0.3 0.2
0.4
0.5
Sep-05 Sep-06 Sep-07 Sep-08 Sep-09
Networth D/E (x)
(1) Networth excluding revaluation reserve at the end of each year; D/E ratio calculated from the networth excluding revaluation reserve
Financial Year 2009 in Retrospect
1,0091,188
1,6121,451
11.6%9.4%10.1%8.9%
5.3%4.7%4.0%3.3%
Q1 Dec 08 Q2 Mar 09 Q3 Jun 09 Q4 Sept 09
Total Income (INR mn) EBITDA (%) PAT (%)
Focus on improving quarterly performanceSept 09 – A mixed bag for WIL
Focus on building a diversified yet synergistic business profile by
leveraging core strength of WIL
Increase portfolio of offerings by entering into technical
collaborations which enable offering larger capacity projects
Constant up-gradation of essential skill sets such as technology,
manufacturing capability, Project Management capability
Action Steps to Mitigate Risk & Improve Performance
First half affected by global recessionary pressures…
Challenges faced by WIL owing to tough macro-economic
situation,
Slow inflow of new orders
Delays in technical clearances from the customers
Delays in commercial clearances from the customers
As a result, the company witnessed contraction in sales &
profitability compared to the previous year
25
…Yet a year of strong order book for WIL
Second half did set out signs of gradual recovery and positive
outlook
WIL managed to leverage upon the same and therefore secured
some marquee and significant orders
Won the 1st EPC contract in the prestigious
petrochemical sector with the oil PSU
Won the 1st high tech piping contract for the Nuclear
Power Sector on EPC basis
Overall order flow from Aerospace, Defense, and Nuclear Power
segment remained strong
In spite of the delays in the commencement of the project there
were no cancellations, leading to a healthier order book for FY10
5 Year Financial Summary
5.7%
398
8.6%
605
71
46
10.3%
722
7,002
Sept 08Particulars Sept 05 Sept 06 Sept 07 Sept 09
Total Income 2,615 3,601 6,374 5,249
EBITDA 157 273 634 529
% to sales 6.0% 7.6% 9.9% 10.1%
Interest 18 22 30 70
Depreciation 29 38 55 105
PBT 110 213 549 354
% to sales 4.2% 5.9% 8.6% 6.7%
PAT 77 133 356 234
% to sales 2.9% 3.7% 5.6% 4.4%
2,2912,1001,292921803Networth excl. revaluation reserve
105
3,196
883
4,219
Sept 08Particulars Sept 05 Sept 06 Sept 07 Sept 09
Liabilities
Networth 1,960 1,983 2,279 4,272
Total Debt 363 296 260 1,250
Assets
Net Fixed Assets* 1,495 1,580 1,738 3,431
Cash & Bank Balances 117 479 276 415
Key P&L Items (INR mn)
Key Balance Sheet Items (INR mn)
26* Including capital WIP
Contents
Key Highlights
WIL- An Overview
Key Financial Information
Annexure Annexure -- Select Turnkey EPC Projects CompletedSelect Turnkey EPC Projects Completed-- Select Components Manufactured by SPDSelect Components Manufactured by SPD
Select Turnkey EPC Projects completed by WIL (1/2)
28
Kager Sugar Ltd Tanzania- Sugar Plant Meghalaya Cements- Cement Plant
Vedanta Group- Zinc Roaster Plant Gem Sugars- 5000 TPD Cane Sugar Plant
Select Turnkey EPC Projects completed by WIL (2/2)
29
15 MW Cogen Plant 6.6 MW Municipal Waste Power Plant
Waste Heat Recovery Boilers 25 MW Biomass Power Plant
Back
Select Equipments Manufactured by SPD (1/2)
30
Gearbox for Corvettes Gearbox for LST (L) Core Support Structure for 500MWe PFBR
Calandria for 500MWe projects Intermediate Heat ExchangerNuclear Fabrication- End Shield
Select Equipments Manufactured by SPD (2/2)
31
SLV-3
PSLV-C2: End segment and nozzle
manufactured
Manufacture of space launch vehicle support material by WIL..
Back
Thank You !
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