investor presentation, august 2007.ppt kingfisher
TRANSCRIPT
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 1/23
1
United Breweries Limited
Investors Meeting August 2007
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 2/23
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 3/23
3
Alcohol Consumption
India EmergingMarkets
21.5% 87%Beer
Spirits/Liquor
Wine 5%
8%
<0.5%
78%Beer is under represented in
India
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 4/23
4
Consumption Per Capita
India China USA
1 litre
23 litres
83 litres
24 litres
World Average
12 litres
Indonesia
1 litre per capita is a major milestoneachieved in India in the last 12 months,
BUT «««
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 5/23
5
Industry Growth
5%
10%
15%
20%
25%
30%
5 Year CAGR2005
2006 2007
Future:
strong doubledigit growth
2008 +
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 6/23
6
Opportunity for Growth
Current population 1.1 billion Over 50% of the population is below the age of 25 years, demographics remain until 2020
Increasing personal GDPThe emerging young population hold moreliberal views on alcohol, than earlier generations
Higher penetration
Sustainable profit growth
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 7/23
7
UBL¶s Capability
Iconic brand ± KINGFISHER
Balanced portfolio of supporting brands
Manufacturing network across all major states
Leadership in cold chain management,
and point of sale visibility Established trade relationships
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 8/23
8
UBL¶s Competitive Advantage-
Through our PromotersUBL
S & N UB Group
Brewing processes Procurement synergies International best practice Experience in capacityinvestment
People resource
Strength in distribution
Enhanced recognition throughKFA
Relationship with USL Buying influence
Route to market influence One stop portfolio of leadingbrands for modern trade
Equal to competition Competitive Advantage
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 9/23
9
Competitor Positions
SABM
± Established in India as the No 2 player
± Investment in capacity
± Brand launches eg Peroni, Castle
International brands have not worked ± Castle launched over 2 years ago > No market share
± Peroni launched over 6 months ago > No market share
± Fosters launched over 5 years ago, pre advertising ban >2% market share
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 10/23
1010
Competitor Positions
Carlsberg ± Acquired Himneel brewery early 2007, new greenfield breweries
in Rajasthan & Maharashtra. Plans to launch a Polish beer.
A ± B
± JV brewery with Crown in AP, plans to build more greenfieldunits. Recent launch of Budweiser & Armstrong beer brands
APB ± 2007 acquisition of Aurangabad brewery, greenfield construction
in progress in AP.
Coors ± Announced plan to build a greenfield unit in Maharashtra
Inbev ± Recently announced JV entry into India.
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 11/23
11
Impact of Competitors
Invest in the market
Invest in capacity
Provide consumers with more choice Drive improvement through the upstream
supply chain
BENEFIT ALL PLAYERS IN THE INDUSTRY
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 12/23
12
Environment for New Competitors
Excessive State regulation and intervention
± Route to market
± Economics, need to have a brewery in each state
± Pricing ± Licensing
Driver of growth is Strong beer,
± all new International entrants brands are leaders in
Mild beer not Strong
Ban on advertising alcohol
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 13/23
13
UBL Reaction to Competition
Maintain profitable Industry leadership Aggressively invest in new capacity, and
upgrade process technology ± Lower cost of investment:
Europe $100 per HL
Russia $55 per HL
India $35 per HL
Develop and launch exciting new products ± Kingfisher Ultra, Kingfisher wine
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 14/23
14
FULL YEAR FY¶07
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 15/23
15
Performance Highlights ± FY¶07
KF Strong overtakes KF premium to becomeIndia¶s biggest selling beer, sales of over 26m cases
Invested around Rs200Cr in new capacity, to
increase own brewery capacity by 20%, and 2new greenfield breweries with over 8.5mcases of capacity pa
Completed acquisition of KBDL, and now
fully merged into UBL Market capitalisation exceeds $1bn Total annual dividend of 25%
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 16/23
16
16
Market Share
33%
48%
UBL SABM MM Mt Shiv Others
6%4%
9%
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 17/23
17
Profit Performance ± FY¶07
EBITDA Net Profit
UBL Consolidated
Net ProfitEBITDA
Rs162 Cr +18%
Rs55 Cr
+550%
Rs172 Cr +24%
Rs65 Cr
+350%
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 18/23
18
Q1¶08
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 19/23
19
Performance Highlights Q1¶08
KF Strong and KF premium outgrowthe industry
New greenfield breweriescommissioned and in operation
Capacity investment for 2008-09 ontrack
Market capitalisation exceeds $1.7bn
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 20/23
20
Kingfisher Performance ± Q1¶ 08
7.15m
7.7m
7.2m
9.3m
June 06 June 07 June 06
Industry Growth +7.2%
Premium
Industry Growth +19.5%
Strong
June 07
+7.6%+28.5%
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 21/23
21
Profit Performance Q1¶ 08
Price increases achieved on around 55% of volume
Results impacted by:
± Capped capacity of Hyderabad brewery impacts UBLstandalone results by Rs6Cr, profit of Rs6Cr recordedin UMBL
± Continuing impacts of prices increases on barley and
hops affects margins UBL stand alone now includes KBDL, MBDL &
ABDL, not included in last years numbers
8/9/2019 Investor Presentation, August 2007.Ppt Kingfisher
http://slidepdf.com/reader/full/investor-presentation-august-2007ppt-kingfisher 22/23
22
Profit Performance ± Q1¶08
EBITDA PBT
UBL Combined
PBTEBITDA
Rs79 Cr +54%
Rs71 Cr +5%
Rs105 Cr +18%
Rs65 Cr
+57%