Ambuja Cements Ltd. — Investor Presentation 2020

Jul 24, 2020

Ambuja Cement

24[th] July, 2020

ACL:SEC:

Bombay Stock Exchange Limited Phiroz Jeejeebhoy Towers, Dalal Street, Mumbai – 400 023	National Stock Exchange of India Ltd., Plot No.C/1 'G' Block Bandra – Kurla Complex Bandra East, Mumbai 400 051
Deutsche Bank Trust Company Americas Winchester House 1 Great Winchester Street London EC2N 2DB, Ctas Documents <ctas.documents@db.com	Societe de la Bourse de Luxembourg, Avenue de la Porte Neuve L-2011 Luxembourg, B.P 165 "Luxembourg Stock Ex-Group ID " <ost@bourse.lu

Dear Sirs,

Sub: Investor Presentation on the Financial Results for the quarter and half year ended June 30, 2020

Pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, please find enclosed the Investor presentation on financial results for the quarter and half year ended June 30, 2020.

You are requested to kindly take the above information on your records.

Thanking you,

Yours faithfully, For AMBUJA CEMENTS LIMITED

Digitally signed by Rajiv Natvarlal Gandhi Rajiv Natvarlal DN: c=IN, o=Personal, postalCode=400066, st=Maharashtra, 2.5.4.20=3a36db83fd05f407f18fda649feacb1989d875e5637db583340b4ecc46796210, serialNumber=5cea5ee8cbe3142aacbf25f4a7a9bed624db55 Gandhi 27f90b86b63752c706e31a3bfa, cn=Rajiv Natvarlal Gandhi Date: 2020.07.24 17:50:36 +05'30'

RAJIV GANDHI COMPANY SECRETARY Membership No A11263

AMBUJA CEMENTS LIMITED Elegant Business Park, MIDC Cross Road B, Andheri (e) Mumbai – 400059 Tel 022: 40667000, Website: www.ambujacement.com Regd off: P.O. Ambujanagar, Tal Kodinar Dist Gir Somnath Gujarat CIN: L26942GJ1981PLC004717

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Second quarter and First half of the Year 2020 results

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© LafargeHolcim Ltd 2015 24[th] July 2020

CONTENTS

 Performance Highlights

• Performance Analysis

• Standalone and Consolidated results

• Products Portfolio

• Ambuja Cement Foundation – Community outreach measures

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2

Q2 2020 PERFORMANCE HIGHLIGHTS

Q2 2020

Robust EBITDA margin expansion; up by 380 bps to 27.8%

EBITDA of ₹ 595 crore only saw a decline of 15%

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Profit after tax up by 10% to ₹ 453 crore Net Sales de-grew 26% due to Covid-19 situation Cement realisations were up 2% YoY

Total Operating expenses declined by ₹ 115 PMT, 3% YoY

Company generated additional cash and cash equivalent of ₹ 714 Crore during January-June 2020

Our greenfield project at Marwar Mundwa, Rajasthan is progressing

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3

H1 2020 PERFORMANCE HIGHLIGHTS

H1 2020

EBITDA Margin at 24.4% up by 420 bps

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EBITDA of ₹ 1198 crore ahead of 2019 by 3%

EBITDA PMT increased by 27% to ₹ 1205 Profit after tax at ₹ 852 crore up by 1.6% Net Sales de-grew 15% due to Covid-19 situation Cement realisations up 3.7% YoY

Total Operating expenses declines by ₹ 48 PMT, 1% YoY

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4

CONTENTS

 Performance Highlights

 Performance Analysis

• Standalone and Consolidated results

• Products Portfolio

• Ambuja Cement Foundation – Community outreach measures

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5

Q2 2020 PERFORMANCE ANALYSIS

Sales Volumes and Net Sales

Million Tonnes – Cement & Clinker

₹ Cr.

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-29%
6.54
5.87 5.77
5.26
4.19
Q2 19 Q3 19 Q4 19 Q1 20 Q2 20
Sales Volumes
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-26%
3,038
2,912
2,760
2,556
2,144
Q2 19 Q3 19 Q4 19 Q1 20 Q2 20
Net Sales
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Volume de-grew 29%, resultant net sales impacted by 26%, due to country lockdown from 25[th] March till end April

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YoY growth Q2’20 vs Q2’19

EBITDA ₹ Cr and EBITDA / Tonne trend

₹/T

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₹ Cr. ₹/T
232/t
19%
-15%
698 1422
603 595 1190
548
1047
440
837 837
Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20
EBITDA PMT
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EBTDA

EBITDA/Tonne increased 19% for the quarter i.e. by ₹ 232/t on account of higher realisations coupled with lower raw material, power & fuel, logistics costs and other fixed costs

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YoY growth Q2’20 vs Q2’19

Key Costs - Power & Fuel and Freight & Forwarding Costs trend

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₹/T
48/t
-5%
1,138
1,037
1,023
989
975
Q2 19 Q3 19 Q4 19 Q1 20 Q2 20
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₹/T

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59/t
-5%
1,292 1,281 1,287
1,261
1,202
Q2 19 Q3 19 Q4 19 Q1 20 Q2 20
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Power & Fuel

Freight & Forwarding

Power & fuel sees reduction on account of low cost of fuel,

Savings in logistics on account of re-negotiation of contracts, logistic efficiencies as well as network optimization gained momentum due to acceleration of Master Supply Agreement (MSA) with ACC Limited

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YoY growth Q2’20 vs Q2’19

Key Costs - Raw Material Costs and Other Expenses trend

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₹/T
66/t
-16%
485
438
401
390
335
Q2 19 Q3 19 Q4 19 Q1 20 Q2 20
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Raw Material
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₹/T

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133/t
-16%
1001
862
840
810
677
Q2 19 Q3 19 Q4 19 Q1 20 Q2 20
Other expense
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Raw Material costs decreased YoY mainly due to reduction in rates of Fly & Gypsum

Despite weak operating leverage i.e. lower volumes, Other expenses/tonne saw a sharp reduction YoY due to reduction in other fixed costs coupled with various cost optimisation initiatives

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YoY growth Q2’20 vs Q2’19

Total cost sees a reduction of 3% YoY i.e. Q2 20 vs Q2 19

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₹ / t
-3%
Total Cost 3893
3778
Raw Material 401
335
Employee Cost 288
357
1037
Power & Fuel 989
1261
1202
Freight & Forwarding
Other Expense
677
810
Purchase of Traded goods
112
57 40 106
Change in inventory
Q2 19 Q2 20
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Total Costs saw a decline on account of lower raw material, power& fuel, logistics and other fixed cost in Q2’20

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Raw Material Power & Fuel Other expenses Change in Inventory Employee cost Freight Purchase of Traded goods

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YoY growth Q2’20 vs Q2’19

Total cost sees a reduction of 1% YoY i.e. H1 20 vs H1 19

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₹ / t
-1%
Total Cost
3,874
3,826
Raw Material 395
395
Employee Cost 274
323
Power & Fuel 1,075 981
1,286 1,252
Freight & Forwarding
Other Expense
791 784
Purchase of Traded goods
Change in inventory 26 27 5 86
H1 19 H1 20
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Total Costs saw a decline on account of lower power& fuel, logistics and other fixed cost in H1’20

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Raw Material Power & Fuel Other expenses Change in Inventory Employee cost Freight Purchase of Traded goods

YoY growth H1’20 vs H1’19

CONTENTS

 Performance Highlights

• Performance Analysis

• Standalone and Consolidated results

• Products Portfolio

• Ambuja Cement Foundation – Community outreach measures

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12

Standalone Results: Apr-June 2020 EBITDA Margin expanded by 4.2 pp despite volume de-growth by 18.4%

	Particulars	UoM	Apr-	Apr-	∆ %	Jan-Jun	Jan-Jun	∆ %
			Jun	Jun		2019	2020
			2019	2020
	Sales Volume	MnT	5.82	4.19	-28.1%	12.19	9.95	-18.4%
	Price(Cement)	₹/bag	251	257	2.2%	238	247	3.7%
	Sales	₹ Cr	2,912	2,145	-26.4%	5,759	4,905	-14.8%
	Revenue from operation	₹ Cr	2,984	2,177	-27.0%	5,911	5,004	-15.3%
	Revenue from Operation	₹ per ton	5,083	5,200	2.3%	4,822	5,031	4.3%
	Operating Expenses	₹ Cr	2,285	1,582	-30.8%	4,750	3,806	-19.9%
	Operating Expenses	₹ per ton	3,893	3,778	-3.0%	3,874	3,826	-1.2%
	EBITDA	₹ Cr	698	595	-14.8%	1,162	1,198	3.2%
	EBITDA Margin	%	24.0%	27.8%	3.8 pp	20.2%	24.4%	4.2 pp
	EBITDA	₹ per ton	1,190	1,422	19.5%	948	1,205	27.2%
	Finance cost	₹ Cr	21	18	-12.3%	38	41	7.9%
	Depreciation	₹ Cr	131	129	-1.5%	262	267	1.7%
	Non Operating Income	₹ Cr	58	192	231.6%	298	280	-6.0%
	Profit before tax	₹ Cr	605	640	5.9%	1,159	1,171	1.0%
	Tax expenses	₹ Cr	193	187	-3.0%	320	318	-0.7%
	Profit after Tax	₹ Cr	412	453	10.0%	839	852	1.6%
	Earning per Share	₹	2.08	2.28	9.6%	4.23	4.29	1.4%

Comments Q2’19 vs Q2‘20

• Volume down by 28% due to lockdown in April

• Non operating income is up as dividend from ACC ₹ 133 crore

• EBITDA Margin expanded by 3.8 pp

• Comments H1’19 vs H1’20

• EBITDA higher than PY despite lockdown impact

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13

Consolidated Results: Apr-Jun 2020

	Particulars	UoM	Apr-Jun	Apr-Jun	∆ %	Jan-Jun	Jan-Jun	∆ %
			2019	2020		2019	2020
	Cement Volume	MnT	12.96	8.66	-33.2%	26.80	20.85	-22.2%
	Sales	₹ Cr	6,920	4,544	-34.3%	13,614	10,673	-21.6%
	Revenue from operations	₹ Cr	7,074	4,644	-34.3%	13,905	10,894	-21.7%
	Operating Expenses	₹ Cr	5,590	3,522	-37.0%	11,424	8,580	-24.9%
	EBITDA	₹ Cr	1,484	1,122	-24.4%	2,481	2,314	-6.7%
	EBITDA margin	%	21.4%	24.7%	3.3 pp	18.2%	21.7%	3.5 pp
	Finance Cost	₹ Cr	41	31	-23.0%	79	65	-17.8%
	Depreciation	₹ Cr	278	292	5.0%	558	588	5.5%
	Share in profit of joint venture	₹ Cr	4	2	-51.9%	9	6	-36.8%
	Non Operating Income	₹ Cr	110	111	0.4%	373	253	-32.3%
	Profit Before Tax	₹ Cr	1,280	912	-28.8%	2,226	1,918	-13.8%
	Tax Expenses	₹ Cr	448	319	-28.7%	699	583	-16.5%
	Profit Before Non ControllingInterest	₹ Cr	832	593	-28.8%	1,527	1,335	-12.6%
	Non Controlling Interest	₹ Cr	209	135	-35.2%	409	324	-20.8%
	Profit After Non Controlling Interest	₹ Cr	623	457	-26.6%	1,118	1,011	-9.6%
	EPS	₹	3.14	2.30	-26.8%	5.63	5.09	-9.6%

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CONTENTS

 Performance Highlights

• Performance Analysis

• Standalone and Consolidated results

• Products Portfolio

• Ambuja Cement Foundation – Community outreach measures

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AMBUJA PRODUCT PROTFOLIO

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CONTENTS

 Performance Highlights

• Performance Analysis

• Standalone and Consolidated results

• Products Portfolio

• Ambuja Cement Foundation – Community outreach measures

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17

Community Outreach through Ambuja Foundation Continued Efforts of programs inspite of the lockdown and restrictions(1 of 2)

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Community Outreach through Ambuja Foundation Quick response help communities prepare for COVID (2/2)

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19

DISCLAIMER

Cautionary statement regarding forward-looking statements

This presentation may contain certain forward-looking statements relating to Ambuja Cements Ltd. (“ Ambuja ”, or “ Company ”) and its future business, development and economic performance. These statements include descriptions regarding the intent, belief or current expectations of the Company, its subsidiaries and associates and their respective directors and officers with respect to the results of operations and financial condition of the Company, subsidiary or associate, as the case may be. 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 (1) competitive pressures; (2) legislative and regulatory developments; (3) global, macroeconomic and political trends; (4) fluctuations in currency exchange rates and general financial market conditions; (5) delay or inability in obtaining approvals from authorities; (6) technical developments; (7) litigation; (8) adverse publicity and news coverage, which could cause actual development and results to differ materially from the statements made in this presentation. Company assumes no obligation to update or alter forward-looking statements whether as a result of new information, future events or otherwise. 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.

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.

This presentation and its contents are confidential and should not be distributed, published or reproduced, in whole or in part, or disclosed by recipients directly or indirectly to any other person.

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20

Confidential – Not to be distributed

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