Godrej Industries Ltd 210611

8/6/2019 Godrej Industries Ltd 210611

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INVESTOR AND ANALYST MEET

June 21 2011


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DISCLAIMERThis presentation does not constitute or form part of any offer or recommendation or solicitation topurchase or buy or deal with in any securities of Godrej Industries Limited (GIL) (the Company), norshall it or any part of it or the fact of its distribution form the basis of, or be relied on in connection with,any contract or commitment thereof.

This presentation contains statements that constitutes forward-looking statements. These statements

include descriptions regarding the intent, belief or current expectations of the Company or its directorsand officers with respect to the results of operations and financial condition of the Company. Thesestatements can be recognized by use of words such as expects, plans, will, estimates, outlook,projects or other words of similar meaning. Such forward-looking statements are not guarantees offuture performance and involve risks and uncertainties, and actual results may differ from those in suchforward-looking statement as a result of various factors and assumptions which the Company believes to

.

revise any forward-looking statement that may be made from time to time by or on behalf of the Company.Actual results might differ substantially or materially from those expressed or implied. Importantdevelopments that could affect the Company's operations include changes in industry structure, significantchanges in political and economic environment in India and overseas, tax laws, import duties, litigation and

.

No representation, warranty, guarantee or undertaking, express or implied, is or will be made as to, and no

reliance should be placed on, the accuracy, completeness or fairness of the information, estimates,.

relevance, accuracy and adequacy of the information contained in this presentation. Any opinionsexpressed in this presentation are subject to change without notice. None of the Company, promoters orany other persons that may participate in this presentation shall have any responsibility or liabilitywhatsoever for any loss howsoever arising from this presentation or its contents or otherwise arising in

2 I Godrej Industries Limited I Investor and Analyst Meet | June-21-2011

connection therewith.


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AGENDA

Company Overview

Investment Rationale

Godrej Agrovet Deep Dive



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COMPANY OVERVIEW



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BALANCED PORTFOLIO OF GROWTH BUSINESSES

CHEMICALSown business

Fatty alcohols, fatty acids, glycerin & surfactants

Key ingredients for personal care, home care &Revenue growth in FY 11 31%

PBIT growth FY 11 85%

GODREJ

specialized consumer products

Animal Feeds - cattle, layer, poultry & aqua feeds Revenue rowth in FY 11 20%

(75.2%) -

Poultry & processed meats

Townships, Residential & Commercial projects

PBIT growth FY 11 103%

PROPERTIES(70.6%) Presence in 11 cities across India 83.6 million sq ft of development area

ncome grow n

PBT growth FY 11 - 26%

PROPERTY

DEVELOPMENT

(40% )

2.8 Mn sq ft to be developed in prime Mumbai suburb

Mixed use development with best-in-class design and sustainable green buildings

FMCG(GCPL -21.6%)

Home care, Personal Care , Foods & beverages

Leadership in Insecticides & Hair color segment

GCPL

Revenue growth in FY 11 78%


. A third of revenues now coming from international operations

Net profit growth in FY 11 52%


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INVESTMENT RATIONALE



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r n v n

systematic va ue crea on approach

Proven track record of value creation

strong value of underlying assets



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POWERFUL BRAND

One of the most well known brands built around trust and reliability

500 million consumers use at least one Godrej product everyday

$2.86 billion brand valuation determined by global brand consulting


agency Interbrand


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LEADING MARKET POSITIONS

Oleo-chemicals & Surfactants Household insecticides

#Animal feeds

Oil Palm plantations

Liquid detergents

Soya milkHair color Processed Chicken

Soaps

Sugar confectionery



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OUR CREATE GROUP PORTFOLIO STRATEGY

Consumer & Chemicals

Realstate

A ri

Transformation Drive to full potentialEmergent Focused incubation of new

businesses



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CONSUMER (GCPL) Largest Indian home & personal care company Leading positions in core categories in the domestic market:

No. 1 in hair colours, household insecticides, and liquid detergents; No. 2 in soaps

Sara Lee stake acquisition has led to a more diverse and balanced domestic

ortfolio

Recent international acquisitions establish platform for becoming a leadingemerging markets FMCG company

Strong positions in core categories internationally home care, hair care andpersonal wash

Unparalleled track record of value creation among FMCG companies in India



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LEADING PRESENCE IN DOMESTIC CORE CATEGORIES

Key categories Key brands Category market share Rank

Soaps .

Hair colour #129.4%

Household36.6%

Liquid detergents#186.3%


Source: A.C. Nielsen (MAT 11)


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7 ACQUISITIONS MADE IN FY 11 GLOBALLY

ompany ey ran s a egory

Godrej Sara Lee(India) 51%stake

Householdinsecticides, homecare

#1

Megasari

(Indonesia)

Household

insecticides, air care,

#2 (HI); #1 (Aircare); #1 (Baby

wipes),

Issue &Argencos(Argentina)

#1 in severalLatam markets

Hair color

Tura (Nigeria) #2Medicated Soaps

SalonSelectives (UK)

Hair color

Swastik &Genteel (India)

Personal care, laundry #2 in laundry


ea ng presence n core ca egor es an a por o o o marquee ran s


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STRONG FINANCIAL PERFORMANCE

4000 800,

3000

653

60078% 55%

2,0412000

420400

52%

1000 200

0

FY 10 FY 11

Sales

FY 10 FY 11

PBT PAT

16 I Godrej Industries Limited I Investor and Analyst Meet | June-21-2011Note: Values in Crore

Financials are for GCPL Consolidated


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REAL ESTATEGODREJ PROPERTIES LIMITED

Brings the Godrej Group philosophy of innovation and excellence to the real

estate industry

Ke stren ths are:

Differentiated business model: Joint venture model which is asset light, capital

efficient, and highly scalable

Godrej Brand: Among Indias most trusted brands in an industry known for relative

lack of transparency

(Ahmedabad, Chandigarh, Mangalore)

National presence: With projects in 11 cities, has emerged as a successfulnational developer

Godrej Group MOUs: Access to land parcels owned by Godrej Group gives

further abilit to ex and



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NATIONAL PRESENCE FOR GODREJ PROPERTIES

Chandigarh

NCR

Kolkata

Ahmedabad

MumbaiPune

Hyderabad

Mangalore Bangalore

Chennai

Kochi



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FINANCIAL RESULTS FOR GODREJ PROPERTIES

750 300

559213 205

28%

390

500

166 162200

26%

250 100

0 0

FY 10 FY 11

Sales

FY 10 FY 11

EBITDA PBT

19 I Godrej Industries Limited I Investor and Analyst Meet | June-21-2011Note: Values in Crore


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REAL ESTATE

VIKHROLI DEVELOPMENT PROJECT

In January 2011, GPL unveiled its 35-acre mixed development projectThe Trees at Vikhroli

pprox . m on sq o pr me proper y o e eve ope n um a

JV between GIL & GPL on profit sharing basis

GIL would effectively be beneficiary of 82.4% of profits (through its direct40% share in profits + its 70.6% stake in GPL)

GPL has already begun construction of Godrej One - a 0.75 million sq ftcommercial office building and progress is on schedule



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CHEMICALS

Indias leading manufacturer of oleo-chemicals & pioneer in

Caters to the raw material needs of high growth consumer goodssectors Personal care, home care, tyre industry & specialised

applications

Reliable supplier to global MNCs Ex orts to over 60 countries across 6 continents

FY 11 revenues of 1023 crore are 31% increase from previous year



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PRODUCTS USED AS INPUT MATERIAL IN A VARIETY

Products Applications Drivers for GIL

Cosmetics (Shaving, Facial

creams)

Movement into specialty fatty acid

to drive growth glycerin

PVC processing Pharmaceutical, Humectants,

Cosmetics

the range of applications

Fatty alcohols CosmeticsIndustrial applications, Personal care,

Export sales to drive growth Developing direct relationships withMNC clients to meet their global

,

Shampoos, Conditioners

Toothpaste,

Export led growth

Plans to:Surfactants

Cosmetics, Detergents

Gain greater share of existingcustomer businesses

Upgrade to value added



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STRATEGIC SHIFT TO HIGH MARGIN PRODUCTS

De-risking strategy resulted in increased sales in high margin products.

Share of s ecialt chemicals increased to 33% in the overall revenue mix ascompared to 29% last year

Percentage share of products to Division's turnover

33.8%

40.8%

31.6%

35.6%

33.2%

40.0%

35%

40%

45%

22.3%

29.2%

26.3%

20%

25%

30%

3.1% 3.6%5%

10%

15%

.0%

Speciality Chemicals Fatty Acids & Glycerin Fatty Alcohol Others


FY 2008-09 FY 2009-10 FY 2010-11


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CAPEX UPDATE

The manufacturing facility at Ambernath will be on a 20 acre plot of MIDC land and wouldNew Oleo-chemicals manufacturing facility at Ambernath, Maharashtra

,

Capex Outlayou crore.

Capex Timeframe

2 3 years ; expected to be fully operational in FY 2013-14

Progress update

Civil work of Phase-1 in progress (Boundary wall, Land Filling & Underground Watertank).

Other clearances / permission to be obtained on track



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CAPEX UPDATE (Contd)

The new splitting plant and fractionation plant will augment capacity for manufacture ofNew Plant at existing Factory at Valia, Gujarat

Capex OutlayAbout 50 crore.

Capex Timeframe

15 18 months ; expected to be fully operational in FY 2013-14

Progress update

Work undertaken for Phase-1: Fractionation column with storage tanks ase- o t e pro ect expecte to e comp ete y arc .



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SALES CROSS 1000 CRORE

1250 100

1023

1000 7531% 85%

781750 49

50

500

25250

0

FY 10 FY 11

Sales

FY 10 FY 11

PBIT

26 I Godrej Industries Limited I Investor and Analyst Meet | June-21-2011 Note: Values in Crore


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LOOKING FORWARD FOR CHEMICALS

Continue to build strong global position in long chain fatty alcohols

Leverage competitive advantage India has in Rapeseed oil increase share ofhi h mar in derivatives of ra eseed oilin the ortfolio

Maintain leadership position as domestic supplier of Alpha Olefin Sulphonate

Expand product portfolio with adjacenciesto current offering.



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AGRI BUSINESSESGodrej Agrovet (GAVL) is a diversified agribusiness with FY 2011 sales of about

1,900 crore

poultry and aqua feed

Oil palm plantations largest oil palm cultivator in India

Agri inputs niche player focused on plant growth regulators, herbicides, etc.

Poultry JV with Tyson Foods, the worlds largest meat processor



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STRONG FINANCIAL RESULTS FOR GAVL

1,8972,000 100

1,581

1,500

20%

6975

1,000 50

103%

500

34

25

- 0FY 10 FY 11

Sales

FY 10 FY 11

PBIT

29 I Godrej Industries Limited I Investor and Analyst Meet | June-21-2011 Note: Values in Crore


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TRANSFORMATION

A GREAT PLACE TO WORK

1st in excellence in HR through technology among top 15 Best Employers in India

GCPL 4overall Best employer by

Outlook Business Aon Hewitt

GPLin real estate and construction industry

among top 100 Best Employers in India



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TRANSFORMATIONKEY HR INITIATIVES

o re er es aunc e

50 senior leaders went through extensive talent development process to receive

Process supported by faculty from Harvard Business School and Columbia University

Employee satisfaction survey conducted across all domestic and international

Long-term incentive schemes modified to further align with shareholder returns



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TRANSFORMATION

GODREJ BRAND EQUITY

Hosted Godrej Power Play for theLifestyle reality show

First brand in India to foray in mass

-

Campaign awarded:

Gold for Best Cam ai n in Countr ,consumers across brackets.India

Gold in Best Brand BuildingCampaign category pan Asia


T


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TRANSFORMATION

EMBRACING SHARED VALUE ACROSS THE GROUP

E.g. Climate

chan e

Revenue growth

e.g. new, greenAddress SocialProblems

E.g. Quality

StrengthenDrivers of

Competitiveness

products

Improved talenteducation pipeline

e concep o s are va ue can e e ne as po c es an opera ng prac ces aenhance the competitiveness of a company while simultaneously advancing the

economic and social conditions in the communities in which it operates.



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GROUP WIDE INITIATIVE CALLED GOOD & GREEN

HAS BEEN LAUNCHED

Beyond Business: Building a More Inclusive and Greener India

by 2020

ensuringemployability creating agreenerIndiaachieve zero waste,

innovating forgood & green

have a third of our

and urban youth in

skilled employment

carbon neutral, positive

water balance and 30%

portfolio revenues

comprising good and/

services


E


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EMERGENT

JV with The Hershey Company, North Americas leading chocolate manufacturer FY 2010-11 revenues were 360 crore

Market leader in the candy segment with over 20% market share

Hersheys Milk Mix sales grew by 47% in FY11; Sofit sales up by 35%;ump n sa es y ;

Product launches during FY 2010-11:

Coffee Eclairs: clairs with a coffee flavor Maha Lacto Hattrick: Three balls of Maha Lacto in flow wrap and with cricketing

eel and design theme



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EMERGENTNATURES BASKET LTD Started in 2005 as a fresh food retailer; morphed into fine food retailer in 2008 Now Indias leading fine Gourmet retail chain and a leader in the niche space

14 stores located in premium residential catchments, ,

3 New stores opened in FY 10-11 (one each in Pune, Mumbai and Gurgaon)

Caters to up-market urban consumers for authentic world food, ingredients,organic foods, health foods, delicatessen, boulangerie, and finest beverages

including wines and beer Revenues at 56 crore for FY 10-11 rew b 63% over FY 09-10

Awarded the Most Admired food retailer of the year in the Foreign FoodsCategory at prestigious Coca Cola Golden Spoon Awards - 2011



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3613 3716

4602

NET PROFIT2466

293

FY 07 FY 08 FY09 FY10 FY11

168 203

59REVENUE

FY 07 FY 08 FY09 FY10 FY11Figures in crore


Due to JVs, restructurings, acquisitions, divestitures, etc. revenue and profit figures are not strictly comparable from year to year.

HISTORY OF VALUE CREATION


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HISTORY OF VALUE CREATION

A proven track record ofvalue creation

10 year compounded annual growth rate (CAGR)

51%Godrej Industries Ltd.

39%

Godrej Consumer

Products Ltd.

ensex

Note: CAGR calculated on closing stock prices as of June 18th, 2001 and June 16th, 2011




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SIGNIFICANT APPRECIATION IN INVESTMENT VALUE

Company BusinessHolding

(%)

Investmentat cost

( Crore)

MarketValue* ofinvestment( Crore)

Godrej ConsumerProducts

FMCG, Personal and HouseholdCare Products 21.6 495 2,550

Godre Pro erties Real Estate and Propertyeve opmen

Godrej AgrovetAnimal Feed, Agri-inputs, Poultry &Oil Palm 75.2 163

o re ers ey oo , everages an on ec onery .

Godrej International International Trading 100.0 17

Natures Basket Fresh food & Gourmet Stores 100.0 14

MedQuist (formerlyCBay)

Medical Transcription 3.7 38 84

Others Bio- Technology, KPO, etc. 44

Total 1 228


* as on March 31, 2011

VALUE UNLOCKING POTENTIAL


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OtherValuableinterests

5 000

6,000

7,000

8,000

Animal Feed

(FY 2011 Revenue :

6,243

6,164

2,000

3,000

4,000

GPL listed

,

Oil Palm Plantation

(FY 2011 Revenue :

115 crore)

GCPL&GPL

Rs.

Crore

1,000

Confectionary / Foods

(FY 2011 Revenue :

GCPLonly

TotalGIL's

share

in

market

capital

of

GPL

&

GCPL GIL's

market

Capital

43.4% share)

Oleo Chemicals

Veg Oils, etc GIL represents a unique opportunity to participate in several high

Other A ri / Poultr

(FY 2011 Revenue :

1,765 crore)

grow sec ors n n a w e rema n ng e-r s e rom e vagar es

of any single industry

With a resence in industries that are c clical Pro erties and more (FY 2011 Revenue :

481 crore)

stable (FMCG); businesses that are rural (Agrovet) and urban

(Properties); businesses that are global (FMCG) and domestic


,

the India growth story

Property

development


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GODREJ AGROVET DEEP DIVE



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GAVL DELIVERED EXCELLENT FY2010-11 PERFORMANCE

1,8972,000Sales PBIT

Annual Consolidated Results ( crore)

1,4501,581

1,400

1,600

,

600

800

1,000

,

25.0 34.2 69.3

0

200

400

Annual sales increased by 20% since FY2009-10

FY2008-09 FY2009-10 FY2010-11

, - All businesses have seen significant increases in sales and profitability

Investments in R&D, Quality, Marketing, and Tech Service have reshaped GAVL


Launch of new businesses in drip irrigation and hybrid seeds underway


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ANIMAL FEED BACK ON GROWTH TRAJECTORY

1 2931,400

Annual Animal Feed Sales ( crore)

982

1,142

1,000

1,200

400

600

800

0

200

FY2008-09 FY2009-10 FY2010-11


Volume growth across all categories, with especially strong performance from aqua feed

Return on Capital Employed (ROCE) for FY2010-11 was 133%

Launched Super Star, the best performing broiler feed in India

Acquired 51% Gold Coin stake in GGCAL and merged with Godrej Agrovet



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CURSE OF FLAT TONNAGES BROKEN IN FY2010-11

900,000Animal Feed Volumes (MT)

700,000

800,000

Other

727,450 721,962 723,379714,150

727,656 732,522

,

500,000

600,000Aqua

400,000 Layer

200,000

,Broiler

Cattle

0

,

FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011


BUSINESS CONTINUES TO BOOM IN BANGLADESH


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BUSINESS CONTINUES TO BOOM IN BANGLADESH

300

Annual ACI Godrej Sales ( crore)

252

200

250

94

156

100

150

0

50


- - -

Increased feed mill productivity from 296 TPD to 350 TPD

Expansion of breeding farm planned for next year


Planning to expand production capacity of floating fish feed and poultry feed


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STRATEGIC PRIORITIES FOR ANIMAL FEED IN FY2011-12

Highest growth in FY2011-12 expected from East, Central, and Aqua regions

Augmenting capacities, with new feed mills being established at Varanasi, Kharaghpur,Erode and Vijayawada

Expanding margins through nutrition R&D, strategic purchasing, and logistics

Shifting cattle feed sales mix towards premium (Type 1) feed

,


OIL PALM BENEFITS FROM GLOBAL COMMODITY BOOM


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OIL PALM BENEFITS FROM GLOBAL COMMODITY BOOM

140

Annual Oil Palm Sales ( crore)

115

100

120

64

60

80

0

20


supported by good monsoon, high CPO prices

FY2008-09 FY2009-10 FY2010-11

Beginning to reap high volume growth from maturing plantations

fresh fruit bunch (FFB) volumes crossed one lac MT


OIL PALM CROSSED 1 LAC MT OF FFB IN FY2010 11


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OIL PALM CROSSED 1 LAC MT OF FFB IN FY2010-11

140,000

Annual Oil Palm FFB Production (MT)

120,460120,000

78,42183,324

80,000

100,000

47,340 49,92860,000

20,000

40,000

0FY06-07 FY07-08 FY08-09 FY09-10 FY10-11


GOVT RENEWS FOCUS ON OIL PALM PUSHES GROWTH


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GOVT RENEWS FOCUS ON OIL PALM, PUSHES GROWTH

Oil Palm New Cultivation (Hectares)

-40,00045,000

+ 9,256

+ 4,751, ,

20,000

25,00030,00035,000

9,738

,

+ 5,322,

05,000

10,00015,000

Upto

FY05-06New

Hectares

FY06-07

NewHectares

FY07-08

NewHectares

FY08-09

NewHectares

FY09-10

NewHectares

FY10-11

NewHectares

Uprooting

FY09 toFY11

Current

TotalHectares

Some uprooting has taken place due to competition from other crops (e.g. sugar cane)

, farmer subsidy increasing from 23,000/ha to 45,000/ha; should halt uprooting

New allotments to GAVL by state governments offers some good news, future upside


Sangli, Kolhapur & Sindhudurg in Maharashtra

STRATEGIC PRIORITIES FOR OIL PALM IN FY2011 12


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STRATEGIC PRIORITIES FOR OIL PALM IN FY2011-12

Accelerating new area coverage, especially in TN and AP Coordinating with government on oil palm sector policy review

Leveraging Farm Management System (FMS) to drive yield improvement

Scaling up leaf & soil testing laboratory to provide farmers with custom advice

Expanding oil palm area covered by drip irrigation

Establishing oil mill (30 TPH, expandable to 60 TPH) at Chintampalli, AP


AGRI INPUTS SET FOR AGGRESSIVE FUTURE GROWTH


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AGRI INPUTS SET FOR AGGRESSIVE FUTURE GROWTH

180

Annual Agri Inputs Sales ( crore)

133

157

120

140

160

80

100

20

40


FY200809 FY200910 FY201011

Agri Inputs focusing on plant growth regulators, herbicides for future growth

Hitweed sales reached 71 KL vs. 21 KL in FY2009-10

Stron efforts underwa to im rove A ri In uts roduct ortfolio


paddy herbicide registration in process; R&D on next generation PGRs

STRATEGIC PRIORITIES FOR AGRI INPUTS IN FY2011-12


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STRATEGIC PRIORITIES FOR AGRI INPUTS IN FY2011-12

Driving sales growth through Hitweed, Zymegold, and HBR Augmenting and modernizing manufacturing capacities

Reducing high working capital requirements through channel management

Registering new paddy herbicide to kickoff sales in FY2012-13

Accelerating R&D program with strong focus on plant physiology

herbicide synthesis, next generation PGRs , abiotic stress mitigation


GODREJ TYSON FOCUSING STRONGLY ON YUMMIEZ


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GODREJ TYSON FOCUSING STRONGLY ON YUMMIEZ

229250

Annual Godrej Tyson Sales ( crore)

157

185200

100

50

Annual sales increased b 24% since FY2009-10

0

FY2008-09 FY2009-10 FY2010-11

Very strong performance by Yummiez

Plannin to ex and rocessin ca acit next ear


NEW BUSINESSES (DRIP, SEEDS) ARE BEING LAUNCHED


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NEW BUSINESSES (DRIP, SEEDS) ARE BEING LAUNCHED

Formally entering seeds sector through Godrej Seeds & Genetics Ltd (GSGL)

ea quar ere a y era a , curren y r ng ea ers p eam

existing maize/paddy seed sales by Agri Inputs being shifted

GSGL to focus initial efforts on three major crops: maize, paddy, bajra

Will enter drip irrigation industry via JV; to be officially announced in July 2011

planning to produce drip laterals, drippers, and related components

-

strong synergy with Oil Palm business


HOW SHOULD WE THINK ABOUT THE FUTURE OF GAVL?


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HOW SHOULD WE THINK ABOUT THE FUTURE OF GAVL?

Godrej Agrovets mission is to improve the productivity of Indian farmers byinnovating products and services that sustainably increase crop and livestock yields.

Feed We will innovate better products

and services for Indian farmers

AgriInputs

Drip

high performanceanimal feeds

next gen PGRs, herbicides

Farmer

OPP extension services

high yield seeds,banana tissue culture

Oil

drip irrigation

We will upgrade our capabilitiesto deliver business success

a m

Poultr

R&D, NPD, marketing

manufacturing


,

REVAMPED GAVL LOGO & SLOGAN REFLECTS MISSION


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Blue = technolo

Green + leaf = agriculture

Based on GodrejGroups slogan ofBrighter Living;

incorporating newGAVL mission



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THANK YOU FOR YOUR TIME AND CONSIDERATION

Godrej Industries Ltd 210611

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