#1PUNJAB CHEMICALS AND CROP PROTECTION CIN NO. L24231PB1975PLC047063 Regd. Office & Works LTD. Milestone-18, Ambala-Kalka Road, Village & P.O. Bhankharpur, Derabassi, Distt SAS Nagar, Mohali (Punjab)-140201, INDIA Tele: 01762-280086, 522250, Fax: 01762-280070, E-mail: [email protected], Website: www.punjabchemicals.com Date: 4th November, 2022 The Manager Department of Corporate Services BSE Limited MUMBAI-400 001 Re: BSE Scrip Code: 506618 BY E FILING The Manager Listing Department National Stock Exchange of India Limited MUMBAI-400 051 NSE Scrip Symbol: PUNJABCHEM Sub: Investor Presentation - Financial Overview - Q2 & H1 of FY23 Dear Sir/Madam, Pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we are enclosing herewith the Investor Presentation of the Company for the quarter and half year ended 30th September, 2022. We request you to take the above information on records.. Thanking you, Yours faithfully For PUNJAB CHEMICALS AND CROP PROTECTION LIMITED SRINIVA Digitally signed S V SRINIVAS by SRINIVAS Date: 2022.11.04 18:05:50 +05'30' COMPANY SECRETARY & COMPLIANCE OFFICER (ACS 37078) Encls: a/a Corporate Office: Oberoi Chambers II, 5th Floor, Plot No. 645/646, New link Road. Andheri (W), Mumbai-400053. INDIA. Tele: 91-22-26747900, Fax: 91-22-26736178, Email: [email protected]#2243 m PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company U Q2 & HI FY23 RESULT PRESENTATION November 2022#3Safe Harbor PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company This presentation and the accompanying slides (the "Presentation"), which have been prepared by Punjab Chemicals & Crop Protection Ltd (the "Company'), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment whatsoever. No offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company. This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and reasonableness of the contents of this Presentation. 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. Certain matters discussed in this Presentation may contain statements regarding the Company's market opportunity and business prospects that are individually and collectively forward-looking statements. Such forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and assumptions that are difficult to predict. These risks and uncertainties include, but are not limited to, the performance of the Indian economy and of the economies of various international markets, the performance of the industry in India and world-wide, competition, the company's ability to successfully implement its strategy, the Company's future levels of growth and expansion, technological implementation, changes and advancements, changes in revenue, income or cashflows, the Company's market preferences and its exposure to market risks, as well as other risks. The Company's actual results, levels of activity, performance or achievements could differ materially and adversely from results expressed in or implied by this Presentation. The Company assumes no obligation to update any forward-looking information contained in this Presentation. Any forward-looking statements and projections made by third parties included in this Presentation are not adopted by the Company and the Company is not responsible for such third-party statements and projections. All Maps used in the presentation are not to scale. All data, information, and maps are provided "as is" without warranty or any representation of accuracy, timeliness or completeness#4TABLE OF CONTENTS 1. Q2 & H1 FY23 Result Highlights 2. Company Overview 3. Business Strategy & Investment Rationale 4. Agrochemicals Industry Overview 5. Performance Track Record PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company#5Q2 & HI FY23 RESULT HIGHLIGHTS PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company#6Result Highlights Q2 FY23 Revenue * 278 cr, up 33% YoY Q2 FY23 EBITDA ₹ 31 cr, EBITDA Margin 11% Q2 FY23 PAT * 18 cr Long-term Client Deals Strong Order Book position: * 1,500 cr ☐ PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company Management Commentary Our growth momentum continues with revenue at 278 cr higher by 33% YoY Increased raw material costs continues to have an impact on gross margin ☐ Pricing pressure in certain markets led to discounted sales which also had a bearing on gross margin Higher power, fuel & freight costs. contributed to increased expenses affecting EBITDA margin Export sales were affected by currency volatility#7Q2 FY23 Financial Performance YoY Comparison (In cr, except margin) REVENUE +33.9% 279 208 Q2 FY22 Q2 FY23 EBITDA & EBITDA MARGIN 14.9% 11.2% 31 31 GEOGRAPHICAL SPLIT 279 208 105 Domestic 103 International 105 Q2 FY22 174 Q2 FY23 PAT & PAT MARGIN 8.6% 6.3% 18 18 Q2 FY22 Q2 FY23 Q2 FY22 Q2 FY23 PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company#8H1 FY23 Financial Performance YoY Comparison (Incr, except margin) REVENUE +31.2% GEOGRAPHICAL SPLIT 551 420 235 212 551 420 H1 FY22 316 208 H1 FY23 H1 FY22 H1 FY23 PAT & PAT MARGIN EBITDA & EBITDA MARGIN 16.4% 69 10.1% 12.1% 66 6.9% 42 38 H1 FY22 H1 FY23 H1 FY22 H1 FY23 PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company#9Consolidated Profit & Loss Statement PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company Particulars (In \ cr) Revenue from Operations Cost of Material Consumed Purchases of stock in trade Q2 FY23 278.6 Q2 FY22 208.8 Y-o-Y Q1 FY23 Q-o-Q H1 FY23 H1 FY22 33.4% 272.1 2.4% 550.7 419.7 Y-o-Y 31.2% 164.7 133.7 194.0 358.7 265.4 1.2 0.8 0.9 2.1 1.7 Change in Inventories & WIP 13.9 -10.5 -23.7 -9.8 -19.4 Gross Profit 98.9 84.7 16.7% 100.9 -2.0% 199.8 172.0 16.1% Gross Profit Margin (%) 35.5% 40.6% 37.1% 36.3% 41.0% Employee Expenses 20.7 19.7 20.2 40.9 39.3 Other Expenses 47.1 34.0 45.3 92.4 64.0 EBITDA 31.1 31.0 0.2% 35.4 -12.3% 66.5 68.8 -3.3% EBITDA Margin (%) 11.2% 14.8% 13.0% 12.1% 16.4% Other Income 1.7 0.1 0.2 1.9 0.4 Depreciation 4.7 4.2 4.6 9.3 8.1 Finance Cost 3.9 2.8 3.4 7.4 5.1 Profit before Tax 24.1 24.1 0.1% 27.6 -12.5% 51.7 55.9 -7.5% Tax 6.5 6.2 7.3 13.9 13.7 Profit After Tax 17.6 17.9 -2.0% 20.3 -13.2% 37.8 42.2 -10.4% PAT Margin (%) 6.3% 8.6% 7.4% 6.9% 10.1% EPS 14.3 14.6 16.5 30.9 34.4#10Consolidated Balance Sheet PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company Particulars (In cr) EQUITY AND LIABLITIES Sep-22 Mar-22 Particulars (In \ cr) ASSETS Sep-22 Mar-22 Equity Non-Current assets Equity share capital 12.3 12.3 Property, Plant and Equipment 205.2 206.2 Other Equity 248.4 213.4 Capital work-in-progress 20.2 6.8 Total equity 260.6 225.6 Right of Use Assets 3.9 4.8 Non-current liabilities Intangible assets 0.7 0.9 Financial liabilities Intangible assets under development 0.5 0.5 Borrowings 65.5 54.6 Financial Assets: Lease liabilities 3.8 3.9 Investments 1.3 1.3 Provisions 16.8 16.8 Others 3.9 3.6 Deferred tax liabilities 4.3 4.1 Income Tax Assets (net) 6.5 6.5 Other non-current liabilities 2.3 2.7 Other non-current assets 4.2 4.2 Total non-current liabilities 92.7 82.0 Total non-current assets 246.5 234.8 Current liabilities Current assets Financial liabilities Inventories 164.0 153.7 Borrowings Lease liabilities 33.8 32.7 Financial Assets: 2.8 2.2 Investments Trade payables Trade Receivables (i) Total outstanding dues of MSME 3.8 6.9 Cash & Bank Balances (ii) Total outstanding dues of creditors other than MSME 134.9 125.3 Bank balances other than above Other Financial Liabilities 31.1 33.1 Loans Other Current Liabilities 20.0 22.2 Other current financial assets Provisions 6.4 5.3 Other current assets Current Tax Liabilities (net) 23.7 22.0 Assets classified for Sale Total current liablities Total liabilities Total Equity & Liabilities 256.6 249.6 Total current assets 349.2 331.6 Total Assets 0.1 0.1 144.3 111.8 12.2 8.4 2.9 2.8 0.1 0.1 2.7 6.9 36.8 38.7 0.3 363.3 322.5 609.8 557.3 609.8 557.3#11COMPANY OVERVIEW PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company#12Our Company Established in 1975 as Punjab United Pesticides & Chemical Limited (PUPCL), the company has now evolved into Punjab Chemicals and Crop Protection Limited. We are an agrochemicals company with a rich history of over three decades with state of the art manufacturing facilities across India Our Vision PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company To become a major Indian player in the fast-growing CRAMS segment and a preferred partner for manufacturing high-tech performance chemicals PUNJAB CHEMICALS&CROP PROTECTION LTD. Ⓒ Our Mission ☐ ■ To achieve income and profitability in a sustained manner To meet the customer expectations with products of the right quality and quantity in required time To focus on products and companies which ensure better added value To forge relationship with Indian Formulators and build a stronger base in the Indian market#13Evolution of Punjab Chemicals Started in 1975 as a small company to cater to the Domestic needs of basic chemicals like Oxalic Acid & Diethyl Oxalate. Establishment Gained Manufacturing expertise & diversified into Pharmaceuticals, Intermediates, Industrial & Specialty Chemicals Operational Excellence Strategic shift in business model to focus on the growing opportunity in CRAMS Innovation 1975 1983 1995 2003 2006 2016 Foundation Specialty Chemicals Agrochemicals M&A - Alpha Drug Pharma Integration in one entity Foray into CRAMS biz model • FY22 Revenue 933 cr 2018 ㅁㅁㅁ PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company Capacity expansion - Agrochemicals • • FY 22 EBITDA * 140 cr FY22 PAT 84 cr • 4 yrs Revenue CAGR : 17.1% • . 4 yrs PAT CAGR: 48.9% Debt/Equity down from 1.4 to 0.4 in last 4 years 2022 Highest ever EBITDA & PAT in Company's history#14Our Global Clientele UPL ADAMA CORTEVA™ agriscience BAYER BAYER Daiichi-Sankyo PEPSI PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company Target regions for next leg of growth: Latin America, South Asia, European Union NIPPON KAYAKLI Coca-Cola LAURUS Labs KUREHA Zydus Cadila#15Manufacturing Facility - Derabassi PURIFIED WATER STORAGE TANK CAR-3KL PLA ABZ PURIFIED WA STORAGE CAP-5ML PLANT M PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company Location Established Derabassi 1975 Area 24.1 acres Manpower 751 Capacity Utilisation (H1 FY23) 85% Molecules: Metamitron, Metconazole, Diflufinican, Oxalic Acid, Benzoic Acid, Ethofumesate Annual Production (MT) & Capacity Utilisation (%) 82% 73% 80% 85% 23,797 19,914 17,543 17,497 85% 13,920 FY19 FY20 FY21 FY22 H1 FY23#16Manufacturing Facility - Lalru 11JM-40 Location Established Area Lalru 2003 23.5 acres Manpower 456 Capacity Utilisation (H1 FY23) 52% • Molecules: Albendazole, Ketosulphone, Drotavarin, Etoricoxib, • PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company Aminoacetonitrile 6 acres available for future expansion Capacity added in FY21: 3,000 MT Annual Production (MT) & Capacity Utilisation (%) 60% 71% 73% 70% 52% 1,610 1,391 1,402 1,345 567 FY19 FY20 FY21 FY22 H1 FY23#17Leadership Team: Board of Directors PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company Mr. Mukesh D. Patel, Chairman • Graduate in Chemical Engineering, experience in finance and Corporate management for more than 43 years • Associated with the company since 1985 Serving as Non-Executive Independent Director on board of Shilchar Technologies & Banco Products . Active roles in Association - CHEMXIL, Indian Chemical Manufacturer's Mr. Vijay Rai, Independent Director BTech, IIT Kharagpur, MD of Rallis India (1988-2000) • • Led Rallis India Ltd from a 200 cr turnover to • 1,200 cr • . • Mr. Shalil Shroff, Managing Director Management Diploma from University of Deopage (USA) Joined in 1992 and Managing Director since 2003 Leads export marketing, general administration, financial liaising, new customer acquisition, developing & launching new products Board Member- Hem-Sil Trading & Manufacturing, SD Agchem (Europe),SSRS Trading & Manufacturing and Scarlett Enterprises Capt Surjit Singh Chopra (Retd), Director Alumnus of NDA, Khadakvasala, 15 years in Indian Air Force • Led as an Air Force Pilot in the 1962, 1965 & 1971 wars • Served as a Pilot in Air India from 1976-2002 • Has been on Board of Greaves Cotton Ltd, Sri Biotech Labs Promoter and Chairman of Akola Chemicals, manufacturer of protein-based nutrients • • Smt. Aruna Bhinge, Independent Director Master of Management Studies, NMIMS & MSc., University of Mumbai 30+ years leadership experience positions in business strategy, marketing, & partnership in the healthcare and agri business sector Also on Board of Laurus Labs Ltd, Mahindra EPC Irrigation Ltd & Mahindra Agri Solutions Ltd • • • Flight instructor and ex-member of the Air Crew Examining Board Associated with the Company since 2004 Mr. Sheo Prasad Singh, Independent Director • 40 years experience in Commercial and Retail Banking • Retired as General Manager of Export-Import Bank from in 2012 Master of Science (Botany), Certificated Associate of the Indian Institute of Bankers (CAIIB), PGDFRM from World Trade Institute, Mumbai, Post Graduate Diploma in Financial Advising (PGDFA)#18Leadership Team: Key Management Team Mr. Avtar Singh, Non-Independent Director • • BSc.- Punjab University; associated with the company for 40 years, • In charge of operations of Agro Chemicals Division and Specialty Chemicals Division Supervises Production, R&D, New Product Development and commercial production of new products . • Mr. Vinod Gupta, Chief Executive Officer • Chemical Engineer, IIT-B & PGPX, IIM-A • Former CEO of Marine Chemicals Business at • Arclean Chemicals & VVF (India) Ltd More than 20 years of experience with Petrochemicals Division of Reliance Industries PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company Mr S.S. TIWARI, Non-Independent Director MSc, Diploma in Mgmt. 39 years association with the company from STS chemicals era Worked at the operational level, looked after the domestic market of various chemicals and managed production sites • • • Dr. S. Sriram, Chief Financial Officer PhD in Supply Chain Mgmt; IIM Ahmedabad (Senior Mgmt Developmt Program), Member of Insti. Cost Accountants India Joined Bayer as Business Controller & rose to General Manager 33 years of total experience including 15 years at UPL, starting as a General Manager to CFO Mr. V Srinivas, GM - Legal & CS • Member of Institute of Company Secretaries of India, Cost Accountant from Institute of Cost and Works Accountants of India, a Law Graduate and a Science graduate More than 24 years of experience with like UPL, SRF, Samtel, Escorts in various areas including secretarial, legal & finance#19BUSINESS STRATEGY PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company 18#20Business Model . • Target 50-100 cr revenue per product Target clients - Global Agrochemical leaders • Mid-sized companies with specific requirement Dedicated R&D Team Quick implementation of the Capex based on ROI • Expertise in Scaling up : R&D Pilot → Commercial Production • Offer PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company attractive and cost- Identify Niche Products Partner for Contract Manufacturing • effective solution Long term engagement favorable for both parties • Faster turnaround Growth Triggers Modus Operandi Diversification & expansion into new geographies New Product launches • Expanding customer base in CRAMS#21Investment Rationale میرا F BOBB PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company Low Cost Operator Developed an efficient cost competitive process over the last decade and are maximising export potential Manufacturing and R&D Capability Availability of technically trained manpower, extra production capacity to fulfil incremental demands Consistent Track Record Historical association with Domestic clients helped expand base to become a preferred partner of choice for MNC clients Changing Industry Global manufacturers are looking to decrease high dependency on China. Poised to benefit from the shift in supply chain Dynamics Way Forward Clients fund a portion of capex to expand production. Export revenues help smoothen the seasonality in domestic sales Punjab Chemicals has the advantage of being a go-to CRAMS provider for both domestic & international agrochemical companies, thus positioned to gain further advantages as the industry expands Prudent Capital Allocation driving growth in ROCE Low Debt & on track to be net debt free Attractive End Market Dynamics#22PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company AGROCHEMICALS INDUSTRY OVERVIEW#23Indian Agrochemicals Industry . . India is the fourth largest producer and the fifth largest exporter of agrochemicals in the world The Indian agrochemicals market (at USD 9.2 bil or ~15% share of the global agrochemicals market worth USD 62.5 bil) is the largest sub-segment of the specialty chemicals industry and posted a 10% CAGR over CY14-19 In 2019 India exported pesticides worth USD 3.4 bil (9.4% of global exports) Production of agrochemicals has grown at a CAGR of ~5% in last 5 years The average per-hectare consumption of agrochemicals in India is about one-tenth of the US and the UK, and one-twentieth of Japan and China. This has a potential to grow multi fold over the next decade India imports over 50% of its agrochemical raw materials. Under the Make In India & Atmanirbhar programs, the aim is to reduce imports by manufacturing more locally The export of agrochemicals in FY20 was valued at around ₹ 22,000 crore, accounting for approximately 1% of the total exports. This has a potential to grow to 35,000 crore by 2025 PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company#24Industry Opportunity Anticipated Growth 2018 → 2025 PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company Integrated Pest Management (IPM) ➤ Patent expiry of agrochemical products $ 32 bil $49 bil CAGR 6.3% ~ 100+ agrochemicals to go off-patent till 2023 Substituting China as Global Agrochemical Hub $3 bil$5 bil Protecting against crop loss and increasing yields Opportunity size Biologicals $2.8 bil → $7.1 bil CAGR 14.4% ~ Sales of products while under patent valued at $11 bil - FY20 China contributed 49% of India's total pesticide imports, valued at INR 9,096 crore Capitalising on Opportunity Improvements in formulation, ease of use, shelf life and spectrum Established players will likely reformulate the off-patent products and look for production partners Indian companies are witnessing interest from multinational companies as they seek to diversify supply chains from China Raising demand for sustainably produced food Feeding the growing global population O O O Demand Drivers for Agrochemicals 0: Tracking climate change Source: Deloitte Industry Report#25Fersity analysis PERFORMANCE TRACK RECORD PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company 24#26Performance Track Record Revenue (cr) EBITDA (*cr) 496 +17.1% 643 678 550 933 +35.4% 96 66 42 42 140 PAT (cr) +48.4% 17 17 11 PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company 49 84 FY18 FY19 FY20 FY21 FY22 FY18 FY19 FY20 FY21 FY22 FY18 FY19 FY20 FY21 FY22 Revenue Split (* cr) Domestic Export 933 EBITDA Margin (%) 678 643 446 10.3 550 8.4 496 256 7.7 232 207 200 487 411 423 296 343 15.0 14.1 PAT Margin (%) 3.5 2.6 2.0 8.9 7.2 FY18 FY19 FY20 FY21 FY22 FY18 FY19 FY20 FY21 FY22 FY18 FY19 FY20 FY21 FY22#27Performance Track Record Capital Structure (* cr) D/E 1.4x 1.0x 0.9x Working Capital Analysis (cr) 0.6x 0.4x 32 45 31 36 81 44 87 95 80 85 82 68 PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company 91 101 88 -85 226 -103 -100 -102 -131 145 91 98 74 FY18 FY19 FY20 FY21 FY22 Debt Equity Return Ratios (%) FY18 FY19 FY20 FY21 Receivable Days Inventory Days FY22 Payable Days Cash Flow (cr) 42 26 202 27 20 45 41 40 68 61 24 35 43 34 34 -4 -11 -19 -21 -24 -43 -14 -27 -8 11 -15 FY18 FY19 FY18 FY19 FY20 FY21 FY22 FY20 FY21 FY22 Operations Financing Investing ROCE ROE#28PUNJAB CHEMICALS AND CROP PROTECTION LTD. ISO 9001:2015 & ISO 14001:2015 Certified Company orientcapital Mr. Nachiket Kale [email protected] +91 99209 40808 Dr. S. Sriram Chief Financial Officer [email protected] Mr. Bhavin Soni [email protected] +91 98335 37225 THANK YOU in LinkedIn Website