Arvind Ltd. — Annual Report 2022

May 18, 2022

L ArVIno

May 18, 2022 .

To

BSE Limited Listing Dept./ Dept. of Corporate Services Phiroze Jeejeebhoy Towers Dalal Street Mumbai - 400001

Security Code : 500101 Security ID : ARVIND

To

National Stock Exchange of India Ltd. Listing Dept., Exchange Plaza, 5th Floor Plot No. C/1, G. Block Bandra-Kurla Complex Sandra (E) Mumbai - 400051

Symbol : ARVIND

Dear Sir/Madam,

Sub.:-Outcome of the Meeting of the Board of Directors held on 18th May 2022

Ref.: Regulations 30 and 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

We hereby inform you that the Board of Directors of the Company at its meeting held today has:

• 1. approved the Audited Standalone and Consolidated Financial Results of the Company for the quarter and year ended on 31st March 2022;
• 1. not recomme.nded dividend on Equity Shares for the year ended on 31st March 2022;
• 1. upon recommendation of the Audit Committee, reappointed Deloitte Haskins & Sells LLP, Chartered Accountants (Firm's -Registration No.117366W/W-100018), statutory auditors of the Company to hold office from the conclusion of the 91s1Annual General Meeting until the conclusion of the 961 hAnnual General Meeting to be held in 2027, subject to the approval of shareholders of the Company and
• 1. upon recommendation of Nomination and Remuneration committee and subject to the approval of shareholders of the Company, approved the reappointment and remuneration of Mr. Punit Lalbhai and Mr. Kulin Lalbhai, Executive Directors, for a period of 5 years from 1st August 2022 to 31st July 2027.

Pursuant to Regulations 30 and 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we enclose herewith the following:

• 1. Audited Stan_dalone and Consolidated Financial Results of the Company for the quarter and year ended on 31st March 2022 along-with Auditors' Reports with " Unmodified Opinion" issued by the Deloitte Haskins & Sells LLP, Statutory Auditors of the Company.
• 1. A copy of the press release being issued by the Company in respect of the Audited financial results for the quarter and year ended on 31st March 2022.
• 1. Investor Presentation for Q4 issued in this regard.

Arvind Limited, Naroda Road, Ahmedabad. 380 025, India Tel.: +91 79 68268000 CIN: L 17119GJ1931 PLC000093

The r:neeting of the Board of Directors of the Company commenced at 11:30 a.m. and concluded at 13:45

We shall inform you in due course the date on which the Company will hold Annual General Meeting for the year ended 3151 March 2022.

You are requested to take the above on your record and bring this to the Notice of all concerned.

Thanking you, Yours faithfully, ~ ·-

Encl.: As above

L ArVIno

Arvlnd Limited. Naroda Road, Ahmedabad. 380 025, India Tel.: +91 79 68268000 CIN: L 17119GJ1931 PLC000093

Arvind Limited Investor Review Note

18th May 2022| Ahmedabad

Safe harbour statement

Certain statements contained in this document may be statements of future expectations and other forward looking statements that are based on management's current view and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. None of Arvind Limited or any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this document or its content or otherwise arising in connection with this document. This document does not constitute an offer or invitation to purchase or subscribe for any shares and neither it nor any part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever.

Q4 FY22 highlights | Strong results despite challenges and volatility in the operating environment

Notes:

• Accelerated Depreciation provided of INR 7 Cr

• One time reduction in tax of INR 14 Cr

• Revenues up 33% from ₹1655 crs to ₹2204 crs

  • Textile revenues increased 48% to ₹1807 crs
  • Advanced Materials was up 34% to ₹267 crs

• EBITDA increased from ₹208 to ₹235 crs as absolute contribution was preserved though higher pricing

  • Textiles EBITDA grew by 16% to ₹194 crs
  • Advanced Materials by 22% to ₹33 crs

• The quarter saw several headwinds

  • Cotton prices continue to climb-up
  • Global logistics continues to be expensive, and un-reliable; domestic freight costs moved up
  • Ankur unit got impacted by court action

• Despite the challenges, Q4 results in line with guidance

  • Garment volumes & revenues at all time high
  • Input cost increases largely passed on to the customers

FY22 summary results: Robust H2 performance helps wrapup a good full year

₹ Crs	FY22 (vs FY21)
Revenues	8034 (+58%)
Textiles	6611 (+65%)
AdvancedMaterials	1024 (+51%)
EBITDA	788 vs 463 (+70%)
Textiles	10.7% vs 10.0%
AdvancedMaterials	12.5% vs14.4%
Net Debt (31stMar2021)	1682 vs 1724 (Dec'21)and 1950 (Mar'21)

• H2 volumes remained strong across all segments of our business, despite higher prices
  • Textiles H2 revenues ₹3724 cr
  • Advanced Materials H2 revenues ₹534 cr
• FY22 EBIDTA increased despite high cotton/ other input prices and international logistics challenges
  • Absolute contributions maintained as market absorbed higher input costs
  • Textiles EBITDA grew by 76% to ₹708 crs
  • Advanced Materials by 31% to ₹128 crs
• Net debt reduction by about ₹42 cr & ₹268 cr compared to Dec & March 21
  • Long term debt reduced from ₹1371 to ₹957 (₹415 crs reduced)

Notes:

• Accelerated Depreciation provided of INR 7 Cr
• One time reduction in tax of INR 14 Cr

Q4 FY22 Consolidated P&L | revenue growth drove higher profits, despite margin pressures

			YoY
AllfiguresinINRCrs	Q4FY22	Q4FY21	Change
fromOperationsRevenue	2204,	6551,	33%
EBIDTA	235	208	13%
EBIDTA%	107%	126%
OtherIncome	10	21
Interest	40	51
CashAccruals	204	178	15%
Depreciation	72	69
PBT	132	37
PAT	94	66	42%
ExceptionalLessItems:	10	13
ProfitNet	84	53

Notes:

• Accelerated Depreciation provided of INR 7 Cr
• One time reduction in tax of INR 14 Cr
• Exception item for the quarter includes ~7 cr land related receivable write off

Continuing discipline on capex and strong operating performance helped generate robust returns

InInrCr	Q4FY22				Q4	FY21
Business	Revenue	EBIDTA	EBIDTA%	ROCE%	Revenue	EBIDTA	EBIDTA%	ROCE%
Textiles	1807	194	7%10	5%18	1220	167	7%13	7%14
AdvancedMaterial	267	33	125%	167%	198	27	138%	211%
Others&InterSegment	130	18			131	36
Total	2204	245	111%	144%	1550	230	149%	136%
InInrCr		FY22			FY21
Business	Revenue	EBIDTA	%EBIDTA	%ROCE	Revenue	EBIDTA	%EBIDTA	%ROCE
Textiles	6611	708	107%	164%	3998	401	100%	62%
AdvancedMaterial	1024	128	5%12	2%20	679	98	4%14	9%17
Others&InterSegment	382	15-			395	16
Total	8016	821	2%10	5%11	5073	514	1%10	8%4
forpreviousRoDTEP
period	18	18

Consolidated Balance Sheet as on Mar 31st 2022

RsCr	31stMar22	30thSept21	31stMar21
Shareholders'Fund	3006	2824	2767
ShareCapital	261	259	259
Surplus&Reserves	2690	2543	2460
MinorityInterest	56	23	47
Borrowings	1759	1976	2002
longTermBorrowings	758	1063	1142
ShortBorrowingsTerm	803	649	631
LiabilityMaturinginLongTermoneyear	199	265	230
Liabilities(CurrentCurrent)LeaseNon+	106	105	119
OtherLiabilities	2833	1955	1833
Total	7705	6861	6721
Assets	3665	3716	3816
FixedAssets	3446	3507	3580
ROUAssets	80	77	89
NonCurrentInvestments	66	68	70
&AdvancesLongLoansterm	1	1	1
OtherNonCurrentAssets	71	63	76
Cashandcashequivalents	77	95	52
OtherCurrentAssets	3963	3051	2853
Total	7705	6861	6721

• Long term borrowings reduced by ₹415 crs over the course of the year
• Net Borrowings reduced by ~ ₹268 cr compared to March 2021 and ~₹42 cr during Q4

FY22 performance clearly surpassed pre-covid levels

₹Crs	FY19	FY20	FY21	FY22
OverallRevenues	7142	7369	5073	8034
growthRevenue		3%	31%-	58%
(RsCr)AMDRevenue	630	713	679	1024,
(inclOtherIncome)EBITDA	800	748	514	839
marginEBITDA	2%11	101%	101%	104%
ROCE	102%	88%	8%4	9%11
(RsCrs)DebtNet	2619	2371	1950	1682

Textile Q4 revenues higher by ~36% driven by ~27% increase in higher realization and remaining from volume growth

Textile revenues (₹ Crs)

DENIM

• Volumes + 13% (22M m)
• Price realization & mix + 23% (₹247/m vs ₹194/m)

WOVENS

• Volumes + 12 % (31M)
• Price realization & mix + 33% (₹200/m vs ₹151/m)

GARMENTS

• Volumes 11 M pcs

Textiles

On a full year basis, Textile revenues were up 65% - of this ~48% came from volume increase

Textile revenues (₹ Crs)

• Denim volumes improved from 62M to 92M m
• Woven volumes from 81M to 120M meters
• Garment volumes from 32M to 36M pcs
• Others includes mainly voiles and fabric retail including suiting

Garment volumes in Q4 were all time high; fabric volumes remained healthy Textiles

• Sequential reduction in volumes resulted from super-normal Q3 that resulted from preponed buying of Spring/Summer
• Border crossing challenges in Bangladesh led to build-up of port-stock at the quarter end

GARMENTS

* Exports volumes includes sales made to export customers and shipments made to their garment factories in India

Textiles

Increasing realization, product reengineering and operational efficiency have helped manage steep cotton prices

• Drought in West Texas and supply chain issues compounding movement on ICE futures
• Demand pick-up and thin inventory position among Indian mills
• Prices for spot deliveries and futures likely to stay strong until new crop arrival in November

• Markets have hitherto absorbed the RM driven price increases
• Product re-engineering, use of re-cycled fibres and operational efficiency have helped mitigate partially

AMD delivered a robust growth as planned

• mark with 75% coming from top 5 customers
  • Launched new products like High Visibility, Anti-microbial and Quilted
• INDUSTRIALS lines continue to grow as capacities expand and utilization improves
  • Unlocking potential of higher value categories like viscose NW and mono x mono filtration products
• COMPOSITES saw marquee wins including supplies to Wilson (raquets) and Indian Coach Factory (parts of Vande Bharat trains)
  • Strong new product momentum
• Above accomplished despite continuously rising input costs and international container

Forward looking commentary

Export demand likely to stay uncertain as inflation, rising interest rates and geo-political disturbances reduce demand visibility

• Consumers in US and UK are facing tough choices between 'heating and eating' as food and energy prices soar at historic pace; Europeans are also facing the prospect of energy supplies from Russia dwindling
• War in Europe leading to shutting down of Russian and Ukranian retail operations by western brands
• Domestic demand is expected to steady firm up with ongoing marriage season and forthcoming festival spell across different parts of India, though higher product prices will keep the pressure on margins

Pressure on input costs likely to remain strong

• Most optimistic estimates indicate cotton prices softening moderately by Nov upon new crop arrival
• Other input costs and energy prices do not show any signs of near term relief
• Resurgence of pandemic waves in China is further aggravating the supply chain/ shipping situation

Q1 FY23 EBIDTA to be marginally impacted due to further increase in input costs in Q4

• Outlook for future quarters will unfold in coming months

We intend to continue our medium term strategy to reduce the Long Term debt

• Additional ~300 crores expected to be reduced during FY23

Thank You!