upl limited

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MARKET DATA

52-week range (INR) 864 / 399

Share in issue (mn) 764.0

Market cap (INR bn/USD bn) 550 / 7,418

Avg. Daily Vo. BSE/NSE (‘000) 7,899.5

Shareholding Pattern (%)

Promoters * 28.0

MFs,FIs &Banks 16.2

FIIs 37.9

Others 18.0

*Promoters pledged shares Nil (% of share in issue)

Auditors

BSR & Co. LLP

Explore:

Analysis Beyond Consensus (ABC) is an initiative to provide a differentiated perspective on various non-routine and intricate Accounting and Corporate Governance issues. This research unit works independent of sector research teams, and views expressed in this report may vary with that of respective sector/stock analyst.

Our FY21 annual report analysis (ARA) of UPL shows a marked

improvement in its balance sheet: above-industry growth enabled it

to deleverage more aggressively than in FY20. Adjusted net

debt/EBITDA was at 2.6x (reported 2.2x) and while adjusted net D/E

at 1.2x is lower than FY20, it is higher than pre-Arysta levels of ~0.5x.

PBT jumped 24% YoY, but OCF post-interest fell 22% compared to FY20

(FY20 WC had moved significantly more favourably versus FY19).

Reported net working capital (as % of sales) improved vis-a-vis FY20

and pre-Arysta levels, but adjusted for receivables’ sales, it is actually

higher than pre-Arysta level. Receivables sales have risen to 20% of

sales in FY21 (from 12% in FY18), potentially due to higher exposure

to LatAM post-Arysta. Exceptional costs continue to recur: 7.2% of

cumulative FY17–21 PBT (excluding Arysta acquisition-related costs).

Deleveraging gathers pace, but leverage still above pre-Arysta levels

An 8% uptick in UPL’s FY21 revenue outgrew industry. The resultant robust earnings

and cash flow enabled it to deleverage more aggressively than in FY20. Adjusted net

D/E thus fell to 1.2x, from 1.5x in FY20 (1.8x in FY19). Adjusted net debt/EBITDA

stood at 2.6x. Adjusted net debt/equity, though lower at 1.2x, remains higher than

pre-Arysta’s ~0.5x. Excluding forex losses, borrowing cost edged down 20bps to

4.4%, but adjusted for forex losses, borrowing cost shot up 90bps to 5%. In FY21,

UPL raised USD500mn of sustainability-linked debt at 30bps lower to pay down

acquisition debt.

WC improves led by payables; receivables’ cycle long due to LatAm

Despite PBT expanding 24% YoY, post-interest OCF fell 22% due to higher WC

deployment than in FY20. Even so, UPL generated post-interest OCF of INR55bn and

adjusted FCF of INR32bn. Reported net WC at ~26% (of sales) improved from 27%

in FY20 and 29–31% in FY17–18. Adjusted for receivables’ sales, which shot up after

the Arysta acquisition, net WC at 42% is better than FY20 but still higher than pre-

Arysta levels. Gross receivables stand higher at 54% of sales compared with pre-

Arysta level of 47–48%, potentially due to higher LatAm exposure.

Exceptional items recur; depreciation conservative

Exceptional costs have been recurring over the past five years; for instance, FY19

and FY20 marked high exceptional costs pertaining to the Arysta acquisition and

integration. Even excluding these, collective exceptional costs were 7.2% of

cumulative FY17–21 PBT for UPL. In FY21, as a proportion of PBT, it stood at 5.4%

(FY20: 18%). In FY21, it was INR3.16bn of restructuring cost (net impact 5.4% of PBT

after including a write-back). Separately, on the other hand, UPL’s depreciation

policy (7.4% D&A rate), as per our analysis, is reasonably conservative vis-a-vis

global agchem peers’ D&A rates of 3–6%.

India Equity Research August 24, 2021

ANNUAL REPORT ANALYSIS UPL Limited

Alok Deshpande Bhavin Rupani Rahul Ahuja +91 (22) 6620 3163 +91 (22) 4063 5544 +91 (22) 6620 3006 [email protected] [email protected] m [email protected]

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Edelweiss Securities Limited

ANNUAL REPORT ANALYSIS

Edelweiss Research is also available on www.edelresearch.com, Bloomberg EDEL <GO>, Thomson FirstCall, Reuters and Factset 2

Capital allocation (FY16–21) acquisition-led; RoCE improves

During FY16–21, UPL generated INR463bn in cash/capital: ~35% from debt, ~25% in

equity and ~35% from cash profits. Of this, the company deployed about two–thirds

in acquisitions, 18% in capex and ~4% for dividends. Following the Arysta acquisition,

consolidated RoCE had plunged to 9.7% in FY20; however improved growth and

earnings lifted UPL’s consolidated RoCE to 12.4% in FY21.

Net worth analysis

UPL’s net worth has more than tripled to INR209bn during FY16–21. A major

contribution came from post-dividend profits (53%), followed by gains on equity

dilution/merger of subsidiary (37%; mainly stake sale in UPL Corporation to Abu

Dhabi Investment Authority (ADIA) and TPG). Furthermore, issue of USD-

denominated 5.25% perpetual subordinated capital securities was fully utilised to

repay existing debt, which contributed 20% towards net worth accretion.

Other key observations: Pertaining to FY21 and from annual report

UPL Corp’s auditor in Mauritius resigns: In Oct-20, KPMG, Mauritius, the auditor

to UPL Corp (material and major subsidiary of UPL Ltd) resigned. According to

UPL’s press release to stock exchanges, KPMG Mauritius resigned as Statutory

Auditors of UPL Corp Limited, Mauritius at the request of the company, in order

to reorganize the audit process to improve productivity.

Remuneration to KMP was flat in absolute terms and, as a result, was down to

4% of PBT from 6.6% of PBT in FY21.

Forex losses almost doubled in FY21 to INR3.5bn (8.8% of PBT; FY19: 6.2%). Net

unhedged forex exposure as % of net worth jumped to 5.5% from -11.3% in

FY20.

Related party revenue jumped during FY21 also, up 37% from INR8.5bn in FY20

(2.4% of sales) to INR11.9bn in FY21 (3.1% of sales). RPT revenue receivables

shot up 21% to INR3bn in FY21, while the net balance sheet exposure stood

1.3% to net worth in FY21 (FY20: 0.1%) due to decline in trade payables, which

jumped during FY20.




Deleveraging gathers pace

Strong earnings and control on working capital, which led to robust cash flow in

FY21, helped UPL pare reported net debt to INR188bn (INR218bn adjusted for

perpetual bonds). This brought down its adjusted net debt/equity to 1.2x in FY21,

from 1.5x in FY20 and 1.8x at peak following the Arysta acquisition in FY19.

Adjusted net debt/EBITDA for FY21 stood at 2.6x and should improve further as

deleveraging continues. Adjusted net debt/equity, though lower at 1.2x, remains

higher than pre-Arysta levels of ~0.5x.

UPL also refinanced part of its debt in FY21. It prepaid 3.25% INR38bn bonds (due

for redemption in 2021) and raised USD500mn (INR36bn) in a sustainability-linked

foreign currency loan. This loan comes at 30bps lower borrowing cost (as per

management) and was used to pay down acquisition debt. In Apr-21, UPL raised

another USD250mn via sustainability loans to repay the acquisition debt. For both

these tranches, if UPL meets certain sustainability KRAs, it stands to benefit from

another 5bps incentive (lower borrowing cost) from lending banks (as per

management commentary on earnings concall).

Exhibit 1: Debt, cash and borrowing cost analysis (INR bn)

Source: Annual reports, company filings, Edelweiss Research

Note: Equity adjusted down for perpetual subordinated securities

Exhibit 2: UPL’s debt is largely foreign currency-denominated (INR bn)


INR bn FY17 FY18 FY19 FY20 FY21

Gross Debt 64 66 291 287 237

Cash and investments 29 29 29 68 49

Net debt 35 37 263 219 188

Add: Perpetual Subordinated Capital Securities - - - 30 30

Adjusted net debt 35 37 263 249 218

Interest expense 5.0 4.8 7.7 13.6 12.5

Interest capitalized 0.2 0.1 0.5 0.5 0.4

Total interest 5.3 4.9 8.2 14.0 12.9

Add: Forex and derivative losses 0.6 1.4 0.1 (1.6) 1.6

Adjusted interest 5.9 6.2 8.3 12.5 14.5

Forex loans (including bonds) 14 52 259 269 217

% share of forex loans within total debt 21.8 78.2 89.1 93.8 91.9

Average borrowing cost (incl forex, including perpetual equity) (%) 10.1 9.6 4.6 4.1 5.0

Average borrowing cost (ex - forex, including perpetual equity)(%) 9.0 7.5 4.6 4.6 4.4

Average yield on cash (%) 7.6 4.3 5.1 1.9 3.3

Reported Net D/E (x) 0.5 0.4 1.8 1.1 0.9

Adjusted Net D/E (x) 0.5 0.4 1.8 1.5 1.2

Reported Net Debt/EBITDA (x) 1.2 1.1 6.9 3.2 2.2

Adjusted Net Debt/EBITDA (x) 1.2 1.1 6.9 3.7 2.6

INR bn FY17 FY18 FY19 FY20 FY21

Non-Current

Redeemable NCDs 8 7 5 5 4

3.25% Senior bonds 32 32 34 38 -

4.50% Senior bonds - 19 20 22 21

4.625% Senior bonds - - - - 34

Foreign currency bank loans 14 0 204 209 127

Others (FY21 = Sustainability l inked Foreign currency loan) - 0 0 0 36

Total Non-current borrowings (A) 54 59 264 274 221

Current

Redeemable NCD's 1 1 3 0 1

Bank Loan 2 1 2 3 3

Working capital loan 6 6 16 7 7

Commercial papers - - 4 - 2

Receivable discounting 0 0 3 3 3

Others 1 - - - -

Total current borrowings (B) 10 8 27 13 15

Total Borrowings C = (A+B) 64 66 291 287 236

Add: Perpetual subordinated capital security (D) - - - 30 30

Total adjusted Borrowings (C+D) 64 66 291 317 266

Including forex losses, UPL’s borrowing

costs shot up 90bps to 5% (from 4.1%)

Excluding these forex losses, borrowing

costs dipped to 4.4%

UPL has continued to rein in borrowing

costs since FY19; however debt (and

interest costs) remains exposed to

currency risk considering 92% of total

debt is denominated in foreign currency




Cash flows robust, but weaker than FY20

Despite a 24% jump in consolidated PBT, OCF post-interest slid 22% YoY due to

higher working capital deployment than in FY20. In FY20, working capital and cash

flow had benefitted from a plunge in other current liabilities. Nonetheless, UPL

generated FY21 post-interest OCF of INR55bn and adjusted FCF of INR32bn, which

proved useful in reducing leverage.

Exhibit 3: Cash flow analysis – Overall robust, but weaker than in FY20 (INR bn)


FY21

Profit before tax 5.5 4.3 28.4 37.5 33.8 41.8

Non-operating expense (2.1) 2.3 16.5 15.9 14.3 18.2

Non-cash adjustments 9.9 9.3 10.9 12.7 20.8 22.0

Direct taxes paid (0.9) 0.1 (7.3) (7.3) (8.2) (7.3)

Exceptional items and prior period items (0.1) - (3.8) (0.5) (3.9) (0.5)

Cash profit after tax 12.2 16.0 44.7 58.3 56.9 74.3

(Increase)/Decrease in trade/ other receivables (4.0) (8.7) 0.8 (3.1) (6.3)

(Increase)/Decrease in inventories 5.5 (6.4) 8.1 (8.8) 13.6 (15.2)

(Increase)/Decrease in loans and advance - - - - - -

(Increase)/Decrease in other assets 4.6 2.4 (5.1) (3.6) (0.5) (1.2)

Increase/(Decrease) in trade payables 2.5 8.8 (1.3) 11.6 1.2 20.4

Increase/(Decrease) in other l iabilities/ provisions (3.1) 5.5 22.5 (5.4) 19.3 0.1

(Increase)/Decrease in working capital 5.5 1.6 25.0 (3.7) 30.5 (2.1)

Net cash from operating activities 6.4 17.6 69.8 54.6 87.4 72.1

Interest expenses/ finance costs (1.8) (1.2) (14.6) (15.4) (16.5) (16.6)

OCF, post interest 15.9 16.4 55.0 39.2 70.9 55.6

Less: Capex (Including CWIP & IWIP*) (10.2) (11.9) (9.2) (9.2) (19.4) (21.2)

Free cash flow (FCF) 5.7 4.5 45.9 29.9 51.6 34.4

Acquisitions/ investments in associates/JVs, others - - (8.0) (2.1) (8.0) (2.1)

Adjusted Free cash flow (FCF) 5.7 4.5 37.8 27.9 43.6 32.3

ConsolidatedStandalone Subsidiary (calculated)

FY20 FY21FY21 FY20 FY20INR bn




Working capital analysis

Exhibit 4: Adjusted working capital (as % of sales) back to pre-Arysta acquisition

levels


* Full-year pro forma financials taken for Arysta for FY19

Exhibit 5 Net working capital trends (as a % of sales)


Exhibit 6 Cash conversion cycle (number of days)


INR bn FY17 FY18 FY19* FY20 FY21

Inventories 41.6 45.4 91.3 78.5 94.2

Trade receivables 56.6 60.6 116.8 120.6 130.3

Trade payables 48.8 56.8 98.5 102.3 125.3

Net core working capital 49.4 49.2 109.7 96.7 99.2

Less: Advance against orders 2.8 2.1 3.4 14.2 15.7

Net working capital 46.5 47.1 106.3 82.6 83.5

Sale of receivables (non recourse) 20.4 20.5 49.3 70.2 76.2

Net working capital (adj. for sale receivables) 67.0 67.6 155.6 152.8 159.7

Net core working capital as % of sales 30.8 28.7 50.8 27.3 25.9

Net working capital as % of sales 29.0 27.5 33.6 23.3 21.8

Adjusted net working capital as % of sales 41.7 39.5 49.2 43.1 41.6

As % of sales FY17 FY18 FY19 FY20 FY21

Inventories 25.9 26.5 28.9 22.1 24.6

Trade receivables (reported) 35.2 35.4 37.0 34.0 34.0

Trade payables (30.4) (33.2) (31.1) (28.9) (32.7)

Net core working capital 30.8 28.7 34.7 27.3 25.9

Advance against orders (1.8) (1.3) (1.1) (4.0) (4.1)

Sale of receivables (non recourse) 12.7 12.0 15.6 19.8 19.9

Adjusted net working capital 41.7 39.5 49.2 43.1 41.6

(number of days) FY17 FY18 FY19* FY20 FY21

Trade receivable days 129 101 135 124 124

Inventory days 94 76 105 81 90

Trade payable days (111) (95) (114) (105) (119)

Core cash conversion cycle 112 82 127 100 94

Less: Advance against orders 6 4 4 15 15

Cash conversion cycle 106 79 123 85 79

Add: Sale of receivables (non recourse) 46 34 57 72 73

Cash conversion cycle (adj for sale receivables) 152 113 180 157 152

UPL’s cash conversion cycle

contracted by six days in FY21 to 94

Inventory days went up, but that was

more than offset by higher payable

days; sale of receivables (by number

of days) stayed flat YoY at 72–73 days

UPL’s reported net working capital at

~26% (as % of sales), a slight

improvement from 27% in FY20 and

29–31% in FY17–18

Adjusted for sale of receivables, which

shot up after the Arysta acquisition,

net working capital improved vis-à-vis

FY20 levels to 42%, but it is still higher

than pre-Arysta acquisition level in

FY18




Exhibit 7: Revenue exposure and cash conversion cycle comparison with global

peers


Sales of receivables up, but flat YoY as proportion of sales

UPL’s sale of receivables at INR76bn in FY21 is higher than INR70bn in FY20, but is

flat at ~20% of sales. Building in these, gross receivables (reported + sold), the trend

is identical to FY20, i.e. 54% of sales. Receivables’ sales jumped from ~12% in FY18

to 20% of sales in FY21. This can be largely due to the higher exposure to the Latin

American region post-Arysta acquisition. UPL’s share of revenue from LatAM has

grown from 33% in FY18 to 38% in FY21. LatAm receivables tend to be longer cycle

(200+ days); hence it is likely UPL would sell these receivables on a non-recourse

basis to banks.

While we have a neutral view on sale of receivables as a practice, we believe it has

to be seen in the context of whether sales growth that UPL achieves compared with

peers, especially in LatAM. UPL clocked 8% sales in LatAM in FY21, versus 5% for

Adama and 1% for FMC.

Exhibit 8: Receivables, bill discounting and allowance on receivables (INR bn)


Revenue share by region UPL Adama FMC Nufarm

Latin America 38% 26% 31%

North America 15% 19% 22% 40%

Europe 17% 25% 30%

EMEA 23%

India, APAC, ME, Africa 30%

Aus & NZ 24%

India 12%

Asia 24% 6%

RoW 18%

Total 100% 100% 100% 100%

Consolidated working capital related days

YE Mar YE Dec YE Dec YE Jul UPL Q3FY21

Trade receivable days 124 115 183 126 120

Add: Inventory days 90 133 86 120 119

Less: Trade payable days (119) (63) (74) (120) (122)

Core cash conversion cycle 94 185 195 126 117

Less: Advance against orders 15 14 27 na

Cash conversion cycle 79 171 168 126

Add: Sale of receivables (non recourse) 73 37 na na 73

Cash conversion cycle (adj for sale receivables) 152 207 168 126 190

Particulars FY17 FY18 FY19 FY20 FY21

Reported receivables (INR bn) 56.6 60.6 116.8 120.6 130.3

Reported receivables as a % of revenue (%) 35.2 35.4 37.0 34.0 34.0

Sale of receivables (INR bn) 20.4 20.5 49.3 70.2 76.2

Sale receivables as a % of revenue (%) 12.7 12.0 15.6 19.8 19.9

Total receivables incl. sale receivables (INR bn) 77.0 81.1 166.1 190.8 206.5

Total receivables as a % of revenue (%) 48.0 47.4 52.5 53.8 53.8

Allowance for doubtful receivables (INR bn) 3.6 3.7 12.0 10.3 9.6 Allowance as % of reported receivables (%) 6.0 5.7 9.3 7.9 6.8

Region-wise revenue share (%)

Latin America 33.1 32.8 35.0 38.5 38.4

North America 17.7 17.7 15.7 15.8 14.7

Europe 13.2 13.3 18.2 16.0 16.6

RoW 17.9 17.9 20.1 19.1 18.2

India 18.2 18.4 10.9 10.7 12.1

Total 100.0 100.0 100.0 100.0 100.0

A direct annual comparison of UPL’s

working capital with other global

agchem peers is not feasible given

different year-ends. Generally,

agchem companies with higher LatAM

presence tend to build up working

capital around December. Hence,

UPL’s Q3FY21 working capital must be

compared to global peers.

This shows that December-end

working capital is within a small range

for all players (i.e. 175–210 days)

From a stock valuation perspective,

we believe if the sale of receivables is

reasonably high, then RoCE

calculations may slightly over-

estimate the actual operational

capital efficiency—since EBIT tends to

be higher (as bill discounting charges

paid to banks come below EBIT) and

capital employed tends to be lower (as

capital employed has only reported

receivables)

In such instances, therefore, we

believe a PE valuation potentially

better captures value rather than

EV/EBITDA.

Total receivables (incl. sale of

receivables) remain higher at 54% of

sales, compared with pre-Arysta

acquisition levels of 47–48%, possibly

due to higher exposure to LatAM, in

our view




Exhibit 9: RoCE analysis for group level and UPL Corp


Exceptional costs lower, but recurring nonetheless

The past two years (FY19 and FY20) saw high exceptional items due to the

acquisition-related costs involved for UPL when it acquired Arysta. However, even

excluding these, UPL continues have exceptional costs quite consistently. In FY21, as

a proportion of PBT, it stood at 5.4% (FY20: 18%). Exceptional costs were offset by a

write-back of INR0.9bn on account of reduction in litigation cost. UPL received a final

court order reducing the damages (which was earlier provided during FY20) from

INR2.3bn to INR0.9bn.

Despite the write-back of litigation costs it provided for in FY20, UPL continued to

report some exceptional charges even in FY21. In FY21, it was INR3.16bn of

restructuring cost. UPL decided to stop production at its Netherlands plant (one of

its oldest manufacturing unit), which required significant repairs and maintenance.

About INR2.6bn was related to this restructuring and severance cost provisions for

the plant shutdown. The remainder pertained to litigation charges in other regions.

Exhibit 10: Exceptional and prior-period items (INR mn)


INR bn FY20 FY21 FY19 FY20 FY21 FY20 FY21

Total Assets 622 617 72 79 88 701 704

Current Liabilities (138) (160) (29) (29) (37) (167) (196)

Capital Employed 484 457 43 50 51 534 508

EBIT 41 52 7 7 12 49 64

ROCE % 9.1 11.1 15.2 16.1 23.6 9.7 12.4

UPL Corp (INR bn) Other (Derived) UPL Consol (INR bn)

Particulars FY17 FY18 FY19 FY20 FY21 FY17-21

Exceptional expenses:

Restructuring/ reorganisation expenditure 370 290 - 2,090 3,160 5,910

Acquisition Cost of Arysta Group - - 3,320 640 - 3,960

Product contamination and counterfeiting 70 130 - - - 200

Inventory provision 180 - - - - 180

Stamp duty on merger with Advanta 320 - - - - 320

Integration Cost on Arysta Group acquisition - - 410 - - 410

Litigation & other exception cost - - 760 3,500 (930) 3,330

Others - - 20 - 150 170

Towards Competition Commission of India - 70 - - - 70

Others 140 140 - - - 280

Total 1,080 630 4,510 6,230 2,380 14,830

As % of PBT (before exceptional item) 5.3 2.6 21.3 18.4 5.4 13.0

Exceptional gain on sale of associates (270) - - - - (270)

Net exceptional and prior period items 810 630 4,510 6,230 2,380 14,560

As % of PBT (before exceptional item) 4.0 2.6 21.3 18.4 5.4 12.8

Exceptional items (costs) continue on

UPL’s P&L quite consistently

FY19 and FY20 had high exceptional

costs due to Arysta acquisition and

integration-related costs; however,

excluding these, FY17–21 collective

exceptional items were 7.2% of the

cumulative FY17–21 PBT for UPL

UPL Corp, which holds majority of the

main businesses for UPL, has a slightly

lower RoCE than consolidated RoCE

UPL’s RoCE improved in FY21 due to

higher earnings




Intangibles and depreciation trends

In FY21, intangible assets down slightly by 4% YoY to INR288bn (still ~161% of net

worth), largely due to decline in product registrations.

Furthermore, in standalone financials, the auditors highlighted the accounting

treatment of goodwill worth INR37bn on amalgamation of Advanta in FY17,

specifying that its amortisation treatment differs from the treatment prescribed

under Ind AS.

Under Ind AS, the company should not amortise intangibles and test them for

impairment at year-end. However, the company amortises the goodwill at 10% p.a.

Hence, there is a P&L charge of INR3.7bn. Had it followed Ind AS, PAT would be

higher by INR3.7bn and the goodwill/net worth would be higher by INR18.4bn.

However, there is no impact on consolidated financials.

Exhibit 11: Goodwill and intangible analysis (INR bn)

Product registration and acquisition useful life remains in mid-range

UPL’s useful life assumption of product registration and acquisition cost stood in the

mid-range compared with international peers. While it remained higher than all of

domestic peers, UPL’s 15-year useful life assumption is higher than FMC and Adama,

but lower than Nufarm (high end is 30 years).

Exhibit 12: Useful life of product registration versus peers Exhibit 13: Sensitivity analysis (INR bn)



Goodwill 4 4 166 182 177

Product registrations/ acquisitions 10 11 86 86 78

Other intangibles 1 1 22 22 21

Intangibles under development 2 2 7 10 12

Total intangible assets 17 18 282 301 288

% of net worth 24 20 191 185 161

Company Useful life (Years)

Domestic peers

UPL 15 years

Astec 5 years

PI Industries 5 years

Rallis 4years

International peers

NuFarm 5-30 years

FMC 6 -10 years

Adama 8 years

Particulars @5 years @8 years @10 years

Gross Block - Product registration

and acquisition

126 126 126

Current amortisation (A) 8 8 8

Current useful l ife 15 15 15

Assuming lower useful l ife 5 8 10

Revised amortisation (B) 25 16 13

Additional amortisation (B-A) 17 7 4 As % of PBT 49.6 21.7 12.4




Exhibit 14: UPL’s depreciation policies are conservative relative to global peers (INR mn)


Exhibit 15: UPL depreciation, amortisation rates versus global agchem peers


Particulars

FY19 FY20 FY21 FY19 FY20 FY21 FY19 FY20 FY21

Depreciation *

Tangible (A) 2,840 4,530 5,000 1,670 4,750 6,400 4,510 9,280 11,400

Depreciation rate (%) 7.5 9.5 8.5 4.7 8.8 9.0 6.1 9.1 8.8

Intangible (B) 700 680 580 4,480 10,160 9,930 5,180 10,840 10,510


Total (A+B) 3,540 5,210 5,580 6,150 14,910 16,330 9,690 20,120 21,910


Gross block: #

Tangible 41,930 53,550 64,460 48,180 59,210 82,750 90,110 112,760 147,210

Intangible 10,420 10,580 10,990 198,090 154,240 153,300 208,510 164,820 164,290

Total 52,350 64,130 75,450 246,270 213,450 236,050 298,620 277,580 311,500

Net block #

Tangible 24,550 31,450 37,460 21,990 24,510 27,060 46,540 55,960 64,520

Intangible 3,010 2,490 2,320 118,960 105,940 96,970 121,970 108,430 99,290

Total 27,560 33,940 39,780 140,950 130,450 124,030 168,510 164,390 163,810

CWIP

Tangible 8,210 8,040 6,380 3,450 2,550 2,610 11,660 10,590 8,990

Intangible 680 820 840 6,210 9,320 11,340 6,890 10,140 12,180

Total 8,890 8,860 7,220 9,660 11,870 13,950 18,550 20,730 21,170

Capex 10,270 10,160 11,930 5,260 9,190 9,233 15,530 19,350 21,163

Standalone Subsidiary (Derived) Consolidated

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FMC

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)

FMC

(am

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(D

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e)




Net worth analysis UPL’s net worth more than tripled to INR209bn during FY16–21. The major contribution

to net worth came from post-dividend profit (53%), followed by gains on equity dilution/

merger of subsidiary (37%; mainly stake sale in UPL Corporation to Abu Dhabi Investment

Authority (ADIA) and TPG). Furthermore, issue of USD-denominated 5.25% perpetual

subordinated capital securities fully utilised to repay existing debt contributed 20%

towards net worth accretion.

Exhibit 16: Net worth accretion (FY16–21) (INR bn)


Exhibit 17: Net worth movement (INR bn)

Source: Annual Reports, Company filings, Edelweiss research

59

81

14 3 56

30

209

Net

wo

rth

(FY

16

end

)

Cu

mu

lati

ve P

rofi

t(N

et o

f d

ivid

end

)

FCTR

(tr

ansl

atio

n)

imp

act

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ne

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s

Gai

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n e

qu

ity

dilu

tio

n in

su

bs.

Per

pe

tual

Sub

ord

iate

dC

apit

al S

ecu

riti

es

Net

wo

rth

(FY

21

)

Networth movement (FY16-21)

Particulars FY17 FY18 FY19 FY20 FY21 FY16-21 % of total

Opening shareholders' fund 58.9 74.0 91.7 147.2 192.4 58.9 28.2

Profit for the year (net of dividend) 15.0 16.5 10.4 14.5 24.1 80.5 38.6

FV of shares issues on Advanta Merger - - - - - - -

Advanta merger w/off - NCI reserve - - - - - - -

Ind AS transition and other adjustments - - - - - - -

Foreign currency translation reserve - 0.7 (7.4) 0.4 (7.8) (14.0) (6.7)

Gain on equity dilution / merger of subsidiary 53.4 3.2 (0.2) 56.3 27.0

Others 90.0 0.5 (0.9) (2.7) 0.3 (2.7) (1.3)

Adjusted closing shareholders' fund 74.0 91.7 147.2 162.5 208.9 179.0 85.7

Add: Perpetual subordinated capital securities - - - 29.9 - 29.9 14.3

Closing shareholders' fund 74.0 91.7 147.2 192.4 208.9 208.9 100.0




UPL Corporation performance

Exhibit 18: Profitability analysis (USD mn)


Exhibit 19: Cash flow analysis (USD mn)


Particulars FY18 FY19 FY20 FY21 FY18 FY19 FY20 FY21

Sales 2,140 2,603 4,487 4,594 100.0 100.0 100.0 100.0

Direct cost 1,382 1,722 2,918 2,962 64.6 66.2 65.0 64.5

Operating and Administrative exp 365 464 402 339 17.1 17.8 9.0 7.4

Personnel cost - - 388 400 - - 8.6 8.7

EBITDA 393 417 779 893 18.3 16.0 17.4 19.4

Depreciation 56 73 208 207 2.6 2.8 4.6 4.5

EBIT 337 344 571 685 15.7 13.2 12.7 14.9

Less: Financial Charges 94 142 172 236 4.4 5.5 3.8 5.1

Add: Other income 15 17 9 23 0.7 0.6 0.2 0.5

PBT before exceptional items 258 218 408 472 12.0 8.4 9.1 10.3

Exceptional Items 7 66 93 26 0.3 2.5 2.1 0.6

Share of loss of associates/JVs (15) 2 (1) 6 (0.7) 0.1 (0.0) 0.1

PBT 236 154 315 451 11.0 5.9 7.0 9.8

Tax 29 12 73 58 1.4 0.5 1.6 1.3

PAT 207 142 242 394 9.7 5.4 5.4 8.6

%

Particulars FY18 FY19 FY20 FY21

Profit before tax 235.9 141.2 315.4 451.5

Non-operating expenses/ (income) 54.4 87.8 215.0 202.3

Non-cash adjustments 95.6 114.6 165.6 257.1

Direct taxes paid (16.7) (38.7) (92.8) (105.6)

Cash profit after tax 369.2 304.9 603.2 805.2

(Increase)/Decrease in inventories (20.3) (12.4) 190.0 (147.3)

(Increase)/Decrease in trade and other receivables (24.7) 78.8 83.3 (156.3)

(Increase)/Decrease in other current assets 3.1 6.3 - -

(Increase)/Decrease in loans and advances (0.7) 22.2 80.0 (88.7)

Increase/(Decrease) in trade and other payables 48.5 84.8 (118.5) 284.5

Increase/(Decrease) in long term and short term provision 1.2 (1.4) 11.4 (19.1)

Increase/(Decrease) in other l iabilities (19.7) (59.0) 212.9 20.3

(Increase)/Decrease in working capital (12.5) 119.2 459.1 (106.6)

Net OCF 356.7 424.1 1,062.2 698.6

Interest expenses paid (100.8) (131.2) (211.0) (212.2)

Adj. OCF 255.9 292.9 851.2 486.5

Capex (95.7) (68.1) (93.5) (123.9)

FCF 160.1 224.7 757.7 362.5

Acquisitions (48.4) (4,293.1) (109.4) (19.8)

Adj. FCF 111.8 (4,068.4) 648.3 342.7




Exhibit 20: UPL Corp capital allocation (USD mn)



Sales 2,140 2,603 4,487 4,594

EBITDA 393 417 779 893

Adjusted PBIT 352 360 580 708

Gross margin (%) 44.2 41.5 35.0 35.5

EBITDA margin (%) 18.3 16.0 17.4 19.4

ROCE (%) 21.2 9.3 9.6 11.9

Net fixed assets (Ex CWIP) 410 4,332 4,203 4,179

CWIP 71 50 34 31

Devlopment expenditure (inc under development) 29 89 123 155

Fixed asset turnover 5.4 1.1 1.1 1.1

Net current assets 462 737 639 679

Equity shareholders' funds (A) 743 2,057 2,415 2,744

Loan funds (B) 985 3,990 3,660 3,075

Reported capital employed (A+B) 1,728 6,046 6,074 5,819

D/E (x) 1.3 1.9 1.5 1.1




Forex losses

Exhibit 21: Forex losses / (gain) (INR mn)


Exhibit 22: Forex losses / (gain)


Exhibit 23: Unhedged forex exposure (INR bn)



Forex loss/ (gain) charged under:

Finance cost & other exps 3,470 1,560 2,630 2,430 3,230

Finance cost (on Derivatives) (470) (80) 400 (710) 420

Total (A) 3,000 1,480 3,030 1,720 3,650

As % of PBT 15.5 6.2 18.1 6.2 8.8

Forex loss/ (gain) charged to reserves:

Capital reserve (10) - (170) 140 (130)

Movement in FCTR - 670 (7,630) 410 (7,750)

As % of PBT (0) 3 (47) 2 (19)

41%

12%

-13%

6%

19%24%

16%

4% 6%

-2%

1%6%

7%

-2%-3%-8%

2%

-2%

3%

-2% -3%

1%2.0

3.03.0

1.5

3.0

1.7

0.0

0.7

1.4

2.1

2.8

3.5

-30%

-15%

0%

15%

30%

45%

FY15 FY16 FY17 FY18 FY19 FY20 FY21 YTD

FX lo

ss/

(gai

n)

-IN

R b

n

(%)

BRL/USD YoY % INR/USD YoY %

FX impact on sales Net FX loss/ (gain) - RHS


Payables

USD 18.0 22.9 146.4 80.4 65.9

EUR 1.9 0.3 13.8 32.7 18.6

JPY - - 27.5 0.6 0.2

Others 0.5 0.9 3.4 1.8 4.5

Total 20.4 24.0 191.1 115.4 89.2

Receivables

USD 8.7 24.7 85.8 58.5 61.0

EUR 0.2 0.6 13.8 17.5 7.1

JPY - 0.1 27.5 45.2 0.6

Others 0.7 1.2 12.4 16.0 9.1

Total 9.6 26.5 139.4 137.2 77.8

Net unhedged (receivables) / payables 10.8 (2.5) 51.7 (21.8) 11.5

Net worth 74.0 91.7 147.2 192.4 208.9

% of net worth 14.6 (2.7) 35.1 (11.3) 5.5

Currency depreciation affected revenue

negatively by 3% driven by depreciation

of the Brazilian real

In FY21, payables’ unhedged exposure

stood higher than receivables’ unhedged

exposure

As % of net worth, it jumped to 5.5%




Exhibit 24: Derivatives contract trend (INR bn)

Source: Annual reports, company filings, Edelweiss research

Related-party transactions

Exhibit 25: Major related-party transactions surged due to increase in sale to associates (INR mn)


Exhibit 26: Effective tax rate – Consolidated and standalone (INR mn)

CurrencyForward

Contract

Cross

Currency

Interest rate

swap

Forward

Contract

Cross

Currency

Interest rate

swap

Forward

Contract

Cross

Currency

Interest rate

swap

USD 27.6 - 24.3 - 94.4 43.2

EUR (0.5) 103.2 (0.4) 110.1 2.5 114.1

JPY 0.3 27.7 (0.4) 30.9 1.4 29.3

Other (1) - (1) - (1) -

Total 26.7 130.9 22.1 141.0 97.5 186.6

FY19 FY20 FY21

Particulars FY20 FY21 FY20 FY21 FY20 FY21 Particulars FY20 FY21 FY20 FY21 FY20 FY21

Revenue 8,500 11,610 10 10 8,510 11,620 Receivables 2,270 2,950 180 10 2,450 2,960

Other income 50 100 - 140 50 240 Loans/ advances 540 850 340 (90) 880 760

Total (A) 8,550 11,710 10 150 8,560 11,860 Total (A) 2,810 3,800 520 (80) 3,330 3,720

% to Sales 2.4 3.0 0.0 0.0 2.4 3.1 Payables 2,450 610 90 150 2,540 760

Purchases 260 160 570 1,260 830 1,420 Sale/Redemption Of

Shares/Ncd

- - 610 260 610 260

Other expenses,

reimbursements

310 110 1,110 1,100 1,420 1,210 Total (B) 2,450 610 700 410 3,150 1,020

Total (B) 570 270 1,680 2,360 2,250 2,630 Net exposure (A-B) 360 3,190 (180) (490) 180 2,700

Purchase as % to Cost

of material consumed

0.1 0.1 0.3 0.7 0.4 0.7 Net exposure as %

to net worth

0.2 1.7 -0.1 -0.2 0.1 1.3

TotalOther PartiesJV & Associates JV & Associates Other PartiesBalance sheet exposure

Total

P&L transactions

Particulars FY19 FY20 FY21 FY19 FY20 FY21

Tax expense 1,980 5,860 6,860 810 770 2,140

Profits before tax 17,590 27,610 41,390 4,860 5,380 4,340

Effective tax rate (%) 11 21 17 17 14 49

Cash Tax 3,540 8,190 7,250 620 880 (700)

Effective cash tax rate (%) 20 30 18 13 16 (16)

StandaloneConsolidatedEffective cash tax rate at consolidated

level declined to 18%; during FY20, UPL

received a cash refund on standalone

level

In FY21, outstanding forward contracts

shot up to INR97bn




Subsidiary performance

Exhibit 27: Revenue and profitability analysis for select subsidiaries (mn)


Currency % holding Country Networth Turnover PAT Tax (%) Networth Turnover PAT Tax (%)

UPL NA Inc.(United Phosphorus Inc.) USD 78 USA 23,500 61,290 4,760 3 23,640 55,900 930 56

UPL Limited, Gibraltar USD 78 Gibraltar 35,540 38,360 3,340 - 140 70 160 -

UPL Corporation Limited (formerly Bio-win Corporation Limited) USD 78 Mauritius 152,180 25,360 3,900 3 155,440 37,910 8,770 3

UPL Limited Mauritius USD 78 Mauritius 11,140 49,230 5,860 - 15,630 59,230 4,820 -

Decco US Post harvest INC USD 78 USA (1,720) 3,090 (2,220) -ve (560) 3,150 1,100 16

Advanta Seeds International USD 78 Mauritius 9,780 3,210 1,480 5 10,870 3,500 1,410 3

UPL Argentina S A USD 78 Argentina (660) 3,060 1,690 - 490 6,680 (600) -2

Others USD 202,050 51,830 6,030 102,220 81,230 (59,410)

Total - USD 431,810 235,430 24,840 307,870 247,670 (42,820)

Cerexagri S.A.S. EUR 78 France 3,820 5,230 260 4 4,650 6,300 690 26

UPL France EUR 78 France 1,210 8,110 320 6 1,380 3,740 460 -

Cerexagri B.V. EUR 78 Netherlands 4,770 8,320 270 25 2,720 2,460 (2,220) 25

UPL Italia S.R.L. EUR 78 Italy 1,390 6,020 (70) -ve 1,430 7,110 - -

UPL Deutschland GmbH EUR 78 Germany 140 240 30 - 600 5,180 40 64

UPL Europe Limited EUR 78 UK 55,930 10,460 70 90 163,070 10,160 70,600 0

Arysta LifeScience Benelux SPRL EUR 78 Belgium 4,630 15,750 2,280 26 7,900 15,580 3,110 23

Arysta LifeScience S.A.S. EUR 78 France 9,080 10,360 850 28 4,430 11,140 660 36

Others EUR 267,870 49,650 21,750 247,060 31,650 35,580

Total - EUR 348,840 114,140 25,760 433,240 93,320 108,920

UPL do Brasil Industria e Comércio de Insumos Agropecuários S.A. BRL 78 Brazil 9,230 73,000 (6,900) -ve 5,740 83,840 (7,710) 2

Advanta Comercio De Sementes LTDA. BRL 78 Brazil 830 1,060 (700) - (60) 1,160 (930) -

Other BRL 5,630 - (3,670) - 2,880 - (3,560) -

Total - BRL 15,690 74,060 (11,270) - 8,560 85,000 (12,200) -

SWAL Corporation Limited INR 100 India 1,220 7,100 130 35 1,490 9,020 280 26

UPL Australia Limited AUD 78 Australia 1,390 3,020 (60) -ve 1,750 4,030 70 13

UPL Costa Rica S.A CRC 78 Costa Rica (30) 5,260 120 37 40 5,800 70 -

UPL Agro S.A. de C.V MXN 78 Mexico (220) 11,890 (320) -ve 1,980 16,500 (1,060) 26

United Phosphorus (India) LLP INR 100 India 700 15,090 340 32 1,060 19,840 350 36

Arysta Lifescience Corporation JPY 78 Japan 21,520 11,010 10,910 1 19,740 6,630 7,120 -2

UPL Limited, Japan JPY 78 Japan 42,920 3,440 (2,010) - 40,710 3,260 (1,900) -

Others 85,686 87,220 2,990 128,570 103,590 5,470

Total - others 153,186 144,030 12,100 195,340 168,670 10,400

Grand total 949,526 567,660 51,430 945,010 594,660 64,300

Name of the subsidiaryFY20 FY21




Gains decline OCI losses

Net loss on derivative contracts outstanding as on FY21 declined 37% YoY to INR1.1bn after booking a gain during the year. This will be re-classified to P&L on expiry of the derivatives contract. Net carrying value of FVTOCI losses as on FY21 stood at INR1.5bn.

Exhibit 28: Other comprehensive income movement (INR mn)


During FY20, loan given & repayment received declined significantly; net repayment

given during FY21 rose to INR230mn.

Exhibit 29: Loan given / taken analysis (INR mn)



Cash flow hedge reserve movement

Opening balance - - (620) (1,780)

(Addition) / reduction - (620) (1,160) 660

Closing balance - (620) (1,780) (1,120)

Addition as % of PBT (before exceptional item) - (2.8) (3.4) 1.5

FVTOCI movement

Opening balance (540) (440) (1,040) (1,830)

(Addition) / reduction 100 (600) (790) 360

Closing balance (440) (1,040) (1,830) (1,470)

Addition as % of PBT (before exceptional item) 0.4 (2.7) (2.3) 0.8

Particulars FY17 FY18 FY19 FY20 FY21Total

(FY17-21)

Sundry loans given (1,340) (140) 4,240 (120) (230) 2,410

Sundry loans repayment received 2,470 850 (3,170) 170 - 320

Net Sundry loans (given)/repayment received 1,130 710 1,070 50 (230) 2,730




Capital allocation trends

During FY16–21, UPL generated and utilised funds of INR463bn. Majority of the

funds were generated through borrowings (35%), followed by operating profits

(35%) and equity-fund raising (25%). The company utilised the funds for investment

in associates / JVs (66%), other investment/cash (12%), capex (18%) and payment of

dividend (4%).

Exhibit 30: Capital generation – Source and deployment of capital during FY17–21 (INR bn)


Exhibit 31: Sources of funds (FY16–21) (%) Exhibit 32: Application of funds (FY16–21) (%)


Sources of Funds (FY16-21) INR bn % Application of Funds (FY16-21) INR bn %

Borrowings 162 35% Acquisitions / Investment in subs 304 66%

Cash PAT (post int, taxes) 160 35% Investments/ cash 54 12%

Equity (including subordinate securities) 113 25% Capex 82 18%

Working capital 20 4% Dividends 19 4%

Investment income 7 1% Miscellaneous 4 1%

Total 463 100% 463 100%

Borrowings35%

Cash PAT (post int,

taxes)35%

Equity (including

subordinate securities)

25%

Working capital

4%

Investment income

1%

Acquisitions /

Investment in subs

66%

Investments/ cash

11%

Capex18%

Dividends4% Miscellaneo

us1%




Profitability analysis

UPL’s top line/EBITDA increased 8%/23% during FY21 led by strong growth in Latam,

Europe, India and RoW. While India business grew by 22%, Europe grew by 19% and

Latam by 8%. Finance charges jumped 39% due to financing element on amounts of

trade payables, up from INR1.4bn to INR2.6bn, while other finance charges moved

from INR1bn to INR3.4bn.

Exhibit 33: Standalone, subsidiary and consolidated profitability (INR bn)


Total discount/ rebate/ incentive given was down 85% and sales returns declined

55%. In fact, total incentive/rebates/discounts/sales return to sales ratio has been

declining over the past four years and stood at merely ~4% of gross sales in FY21.

Exhibit 34: Incentives and discounts


Total other expenses % to sales increased marginally to 19.6%. The major reasons for

the overall jump are power & fuel expenses (up 21bps to 3.8% of sales),

transportation cost (up 60bps to 3.4% of sales) and subcontracting charges (down

74bps to 3.8% of sales).

FY20 % FY21 % FY20 % FY21 % FY20 % FY21 %

Sales 96.4 100.0 113.5 100.0 261.1 100.0 273.5 100.0 357.6 100.0 386.9 100.0

Raw Materials Consumed 55.6 57.7 62.6 55.1 131.8 50.5 128.4 47.0 187.4 52.4 191.0 49.4

Operating and Administrative exp 22.3 23.1 27.9 24.6 46.2 17.7 47.4 17.3 68.5 19.2 75.3 19.5

Personnel cost 6.5 6.7 6.9 6.0 27.5 10.5 30.3 11.1 33.9 9.5 37.1 9.6

EBITDA 12.1 12.5 16.1 14.2 55.7 21.3 67.4 24.6 67.7 18.9 83.5 21.6

Depreciation 8.9 9.2 9.8 8.6 11.2 4.3 12.0 4.4 20.1 5.6 21.7 5.6

EBIT 3.1 3.3 6.4 5.6 44.5 17.0 55.4 20.3 47.6 13.3 61.8 16.0

Less: Financial Charges 2.7 2.8 3.1 2.7 12.1 4.6 17.5 6.4 14.8 4.1 20.6 5.3

Add: Other income (ex-Dividend income) 1.0 1.0 (3.5) (3.0) 0.1 0.0 6.0 2.2 1.0 0.3 2.6 0.7

PBT (ex-dividend income) 1.4 1.5 (0.2) (0.1) 32.4 12.4 43.9 16.1 33.8 9.5 43.8 11.3

Add: Dividend from subsidiaries 4.1 4.2 4.6 4.0 (4.1) (1.6) (4.6) (1.7) - - - - PBT before exceptional items 5.5 5.7 4.4 3.9 28.4 10.9 39.4 14.4 33.8 9.5 43.8 11.3

Exceptional Items and Prior Period items 0.1 0.1 - - 6.1 2.3 2.4 0.9 6.2 1.7 2.4 0.6

Share of loss of associates/JVs - - - - (0.0) (0.0) (0.4) (0.2) (0.0) (0.0) (0.4) (0.1)

PBT 5.4 5.6 4.4 3.9 22.3 8.5 37.4 13.7 27.6 7.7 41.8 10.8

ParticularsConsolidatedSubsidiary (Derived)Standalone

Particulars FY19 FY20 FY21

Discounts/Rebates/Incentives 25.0 43.0 6.6

As % of gross sales 9.8 10.3 1.6

Sales Return 14.4 18.9 8.4


Total 39.4 61.9 15.0





Exhibit 35: Consolidated other expense trend analysis (INR bn)


FY17 FY18 FY19 FY20 FY21 FY17 FY18 FY19 FY20 FY21

Power and fuel 3.4 2.9 4.0 4.6 5.8 2.1 1.7 1.9 1.3 1.5

Transport charges 6.4 6.6 6.8 9.8 12.9 4.0 3.9 3.2 2.8 3.4

Sub-contracting expenses 5.3 7.4 9.0 10.7 14.4 3.3 4.3 4.2 3.0 3.8

Travelling and conveyance 2.5 2.6 3.3 4.5 2.4 1.6 1.5 1.5 1.3 0.6

Advertising and sales promotion 2.8 2.3 3.4 5.4 4.8 1.7 1.3 1.6 1.5 1.2

Legal and professional fees 2.4 2.7 3.1 5.0 4.9 1.5 1.6 1.5 1.4 1.3

Sales commission 1.3 2.1 1.3 1.5 1.4 0.8 1.2 0.6 0.4 0.4

Rent 1.4 1.5 2.0 1.1 0.9 0.9 0.9 0.9 0.3 0.2

Labour charges 1.2 1.4 1.7 2.1 2.6 0.8 0.8 0.8 0.6 0.7

Repairs and maintenance 1.8 2.0 2.4 3.2 2.9 1.1 1.2 1.1 0.9 0.8

Warehousing costs 0.9 1.2 1.1 2.0 2.2 0.6 0.7 0.5 0.6 0.6

Exchange (gain)/ loss 2.4 0.1 3.0 3.3 2.1 1.5 0.1 1.4 0.9 0.5

Other expenses 7.0 7.7 9.1 14.9 18.2 4.4 4.5 4.2 4.2 4.7

Total 38.8 40.5 50.3 68.0 75.3 24.2 23.7 23.3 19.2 19.6

Revenue 163.1 173.8 218.4 357.6 386.9 16.1 6.5 25.6 63.8 8.2

ParticularsINR bn

Sales growth %

% of Sales




Governance

Exhibit 36: Board structure


Exhibit 37: KMP and directors’ remuneration (INR mn)


UPL in its letter dated 16 October 2020 informed the stock exchange that KPMG

Mauritius, the auditor of UPL Corporation Limited, had resigned w.e.f. 8 October

2020. The auditors in their resignation mentioned, “There are no circumstances

connected to our resignation which we consider should be brought to the notice of

the members.” In the same letter, UPL informed “in order to re-organise the audit

process to improve the productivity, at the request of the company, KMPG Mauritius

has resigned as the auditors of UPL Corporation.”

Exhibit 38: Auditor history


Exhibit 39: Auditor remuneration (standalone) (INR mn)



Total directors 12 12 10 9

No. of Independent directors 6 6 5 5

Ratio 0.50 0.50 0.50 0.56

Regulatory norms 0.33 0.33 0.33 0.33

No. of women director 2 2 3 2

Regulatory norms 1 1 1 1

Name Designation FY19 FY20 FY21 YoY %

Rajnikant Devidas Shroff MD & Chairman 130 137 143 4.2

Kalyan Mohan Banerjee WTD (til l Jul-18) 30 - - n.a.

Arun Chandrasen Ashar Executive Director 10 31 34 8.7

Jaidev R. Shroff NED Global-CEO 380 570 608 6.6

Sandra R. Shroff NED 80 90 0 n.a.

Anand K. Vora CFO 38 60 70 16.0

Vikram R. Shroff NED 120 280 304 8.5

Total 788 1,168 1,158 (0.9)

As % of PBT 5.2 6.6 4.0

Non Executive Independent Director 8 6 2 (68.5)

Total 795 1,174 1,160 (1.2)

As % of PBT 5.3 6.6 4.0

Year Auditor

FY19-21 BSR & Co. LLP

FY16-18 SRBC & Co. LLP

Particulars FY17 FY18 FY19 FY20 FY21 YoY %

Payment to Auditors 30 20 30 40 80 100.0

Independent directors’ representation

on the board is above regulatory

norms




Exhibit 40: Credit ratings


NA: Not available

Exhibit 41: Promoter holdings, pledge details and history

Source: BSE, company filings, Edelweiss Research

Facilities/Instruments Rating Agency FY19 FY20 FY21

CRISIL A1+ A1+ A1+

CARE A1+ A1+ A1+

CRISIL AA+(Negative) AA+(Negative) AA+(Negative)

CARE AA+(Negative) AA+(Negative) AA+(Negative)

CRISIL A1+ A1+ A1+

CARE A1+ A1+ A1+

CARE AA+ (Negative) AA+ (Negative) AA+ (Negative)

Brickwork AA+(Stable) AA+(Stable) AA+(Stable)

S&P BBB- (Stable) n.a n.a

Moody’s Baa3 (Positive) n.a n.a

Fitch BBB-(Negative) n.a n.a

Long Term

Commercial Paper

NCDs

International Bonds

issued by UPL

Corporation Ltd.

Short Term

Pledge shares history

Shareholding (June 21) % holding % of pledged shares Year

Promoter's

Shareholding % Pledge ratio (%)

Promoters 27.96 - FY21 27.95 -

Non-promoters 72.04 FY20 27.88 -

Total 100.00 FY19 27.89 2.32

FY18 27.72 1.63

FY17 30.27 -

Promoter pledge remains at nil

Credit rating remains unchanged in FY21

from FY20 and FY19

In FY19, long-term instruments and NCDs’

credit rating changed from AA+ (stable) to

AA+ (negative)

In addition, international bonds’ credit

rating had changed from BBB- (stable) to

BBB- (negative) in FY19




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