Orient Bell Limited — Investor Presentation 2021

Jan 28, 2021

orient bell tiles

OBL:HO:SEC:00:

Nev,, Delhi : 28.01.2021

BSE Limited Corporate Relation Department 1st Floor, New Trading Ring Rotunga BuildingPhiroze Jeejeebhoy Towers Dalal Street, · Mumbai-400 001

National Stock Exchange of India Ltd. Exchange Plaza, Plot No. C/1, G Block, Bandra-Kurla Complex, Bandra (E) Mumbai-400 051

Stock Code - 530365

Stock Code: ORIENTBELL

SUB: INVESTOR PRESENTATION FOR THE QUARTER AND NINE MONTHS ENDED 31.12.2020.

Dear Sir/ Madam,

In continuation of our letter dated 27.01.2021, regarding Schedule of Investor Conference call on Unaudited Financial Results for 3rd quarter and nine months ended December 31, 2020 to be held on January 29, 2021 at 3:30 PM (IST), please find attached Investor Presentation of Orient Bell Ltd. highlighting the performance of the Company during the quarter and nine months ended on 3151 December, 2020

This information will be available on the Company's website i.e. www.orientbell.com. We request you to kindly take the above information on record.

Yours faithfully,

Encl: as above

Orient Bell Limited

CORPORATE OFFICE, Iris House, 16 Business Centre, Nangal Raya. New Delhi - 110 046, India. Tel., +911147119100 REGD. OFFICE, 8 Industrial Area, Sikandrabad - 203 205 (U.P.) India. Tel., +91 5735 222 203 I 222 I 424. +91 81910 04575 I 76. Fax, +91 5735 222 642 E-mail,customercare@orientbell.com, Website, www.orientbell.com CIN, L14101UP1977PLC021546

Shape Up Scale Up

Investor Presentation Q3 & 9MFY21

Disclaimer

This presentation may contain certain forward-looking statements relating to Orient Bell Ltd. 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.

Contents

• 01 | Overview and Q3 & 9MFY21 highlights
• 02 | The journey of shaping-up
• 03 | Next phase: scaling-up
• 04 | Historical financial performance

Overview and Q3 & 9MFY21 Highlights

OrientBell Limited – a leading manufacturer of tiles

A Time tested pedigree

Setting the foundation	Marching ahead	Growth		Shaping up andconsolidation		Well placed to scale up
1977-052006-10		2010-16		2017-19		2020…
1977–Incorporatedasapubliclimitedcompany.1993–Mr.M.K.Daga,veterantiletechnologisttakesoverthemanagement.2000–1stbonusforshareholdersintheratioof1:1.2004–AccreditedwithISO9001:2000andOHSAS18000:1999.2005–1stFranchiseeOrientBellTileBoutiques(OBTB).	2007–Achievesturnoverof200crores.2ndBonusforshareholdersissuedintheratioof5:4.2008–1stIndianmanufacturertohireaEuropeanasChiefProduct&SolutionDesigner.2009–Enterstheluxuryhomedecorsegment.Recordsthehighestprofitgrowthintheindustry.2010–AcquiresBellCeramics.CompanyownedOBTBlaunchedinDelhi.	2011–AwardedPowerBrandStatus.CompanyownedOBTBLaunchinKolkata.2012–MergercompletedwithBellCeramics;renamedtoOrientBellLtd.2013–OBLfiles4thpatent(PendingRegistration).2015–ReceivedISImarkatSikandrabadunit.2016–CompanyownedOBTBlaunchedinChennai.1stJVsetupinMorbi.		2017–Newbrandidentity.100thOBTBlaunched.EYengagedtodevelopperformanceenhancementblueprint.2018–NewCEO&CXOteam.NewlineatSikandrabad(MF-4)tomanufactureGVT.2019–Revampedorganization,newproducts,rationalizedcosts,improvedcustomerconnect,starteddigitization,branding,displays&optimizedworkingcapital.KPMGengagedforplantOperationsReview.		AppointedSRBCforGSTAudit.DigitizationhelpsnavigateCovid.Stakeholderengagement.Noloanmoratorium.ManufacturingstartsinJune.350+SKUlaunched.6%revenuegrowthinQ2RestarteddormantmanufacturinglineinQ3(MF-2).54newOBTBsinQ2&Q3.Salesbranchesupby20%andStateHead/ZHby50%.NetDebtfree&strongcashflow.

Q3FY21 consolidated financial highlights

Q3FY21 consolidated financial highlights

Operational highlights of Q3

People	Sales force increased by 10%. Teeth to tail ratio improves to 2.3 : 1.3 virtual Townhalls, 2 R&R & 2 Digital Events-YTD.Close to 11000 People Hours spent in L&D-YTD.Salary cuts rescinded from October.Zero accidents.
Product	Identifying and filling up profitable portfolio gaps.350+ SKUs launched in Q2 found increasing acceptance with CPs.Front-line sales force incentives, Display efforts, Marketing Efforts ensured wide distribution.
Brand Building	Brand investments increased : +2% of topline (~1.8X of Q2FY21 spend).New Campaigns Launched -#Karon Rishton Ko Renovate AND #Bye Bye 2020 with ~3.5+ million views.New online series "Icons of Creativity" -5 episodes and 2 million views (YTD).
Manufacturing	Rebalancing & debottlenecking of lines continues.Customer Delight initiatives on Quality & service levels launched.Tight focus on costs.
Process	Adoption of Digital tools by employees and Channel partners speeding up.New versions of Channel partner App and Sales executive app launched.Transport management system launched at Sikandrabad unit.
Customer	Building focus on Architect & Influencer segments with 29 new OBTB launched in Q3.Displays in existing OBTB refreshed.

Consolidated Abridged Income statement

		Quarter Ended		Nine Month Ended
(Rs. Crores)	Q3 FY20	Q3 FY21	Y-o-Y	9M FY20	9M FY21	Y-o-Y
Revenue from Operations	122.0	147.9	21.2%	365.5	321.0	-12.2%
Other Income	1.1	0.5	-57.0%	3.0	1.3	-56.7%
Operating Expenses	113.5	132.6	16.8%	344.2	304.7	-11.5%
EBITDA*	9.6	15.7	63.5%	24.3	17.5	-27.9%
EBITDA Margin%*	7.9%	10.7%	2.9%	6.7%	5.5%	-1.2%
Depreciation and Amortisation	6.3	5.1	-18.7%	15.3	15.2	-0.8%
EBIT	3.4	10.6	216.0%	8.9	2.3	-74.5%
Interest and Financial Charges	2.6	1.2	-51.9%	6.6	4.5	-31.4%
Share of profit/(loss) of Associates	0.3	0.4	21.7%	0.6	0.4	-29.6%
Profit Before Tax(PBT)	1.1	9.8	759.7%	2.9	(1.8)	-162.2%
PBT Margin %	0.9%	6.6%		0.8%	-0.6%	-1.4%
Tax Expenses	0.4	2.3	461.0%	1.0	(1.2)	-231.4%
Profit After Tax(PAT)	0.7	7.5	931.0%	2.0	(0.6)	-129.1%
PAT Margin %	0.6%	5.1%	4.5%	0.5%	-0.2%	-0.7%

Topline Growth +21% y-o-y on back of successful implementation of strategic initiatives.

EBITDA Margin of 10.7% aided by higher volumes, lower fuel costs & cost control.

Excluding the impact of one-time adoption of IND AS 116 "Lease Accounting" in Q3FY20, on a L-f-L basis EBIDTA margin improved by 4% - from 6.7% in Q3FY20 to 10.7% in Q3FY21.

*Q4FY20 & Q1FY21 impacted due to lockdown post COVID.

Journey of shaping-up

Consolidated Financial comparison for last 4 quarters

Key Strategies driving "Shaping Up"

Team with diverse experience focused on building sustainable competitive advantages.

OFFERING

New categories to fill portfolio gaps & revamp existing categories with new designs.

MANUFACTURING

Major improvements in manufacturing costs and Quality. Focus on new products & Customer delight.

DISTRIBUTION NETWORK

Empaneled new channel partners, opened new boutiques and widened our market presence pan-India.

Building awareness and consideration thru digital.

Award winning website and Tools launched to assist customers in buying tiles.

BALANCE SHEET

Brought down debt significantly and optimized working capital to industry leading levels.

Revamped leadership team with diverse experience 1

Reorganization of top-level management poised to lead the company into new phase of sustainable growth Leaders with a mix of strategic focus, deep customer understanding and ability to execute.

Aditya GuptaChief Executive Officer30years of multi-functional experience in industry leadingcompanies, Previously worked with UB Spirits, Bharti Airtel,	Joinedin March2018	Joined InApril2004	Anil AgarwalChief Operations Officer34+ years of experience in the ceramics industryHas been a part of the OBL team for 16+ years, previously
Reliance Communications & TATA Group.Himanshu JindalChief Financial Officer18+yearsofexperienceinleadingfinancerolesPreviously worked with Heidelberg cement, Cipla, Cargill,Pfizer and most recently, as the CFO at Den Networks.	Joinedin December2018	JoinedIn July2018	worked with Somany Ceramics & VrundavanCeramics.Alok AgarwalChief Marketing Officer23+ years of experience in leading marketing rolesPreviously worked with Unilever, GSK Consumer Healthcare,SaraLee and EbayIndia.
Ajay SrivastavaChief Human Resources Officer26+ years of experience in human resource managementPreviously worked with PepsiCo, ITC Limited, Dainik Jagran,and most recently as Head of HR at Baxter.	Joinedin June2019	Joinedin August2018	Pinaki NandyChief Sales Officer25+ years of experience in leading sales rolesPreviously worked with Vodafone and Cadbury and, asBusiness Head –Philippines and Bangladesh at AkzoNobel.
Hired 160+Invested in EmployeeTrainingDuring Covid-19		Reduced EmployeeAttrition	Performance LinkedEmployees StockReward RecognitionOptions (ESOP)	14

Product Portfolio- A Structured Approach 2

• Market research to select designs.
• Solution based strategy Germfree tiles 5% of sales.
• Focus on High Value.
• Innovative Tiles (patent pending).
  • Germ-free tiles: specially formulated glaze with antimicrobial treatment.
  • Anti-viral Tiles: These tiles restrict the spread of viruses on the surface and kill more than 99% of the viruses in 2 hours.
  • Anti-Static Conductive Tiles: Specifically designed for data centres and other places with sensitive electronic equipment, these tiles conduct static electricity preventing potentially dangerous electric sparks.
  • Forever tiles: High abrasion, scratch and stain resistant.
• CERAMIC VITRIFIED Cool tiles: Lowers building temperature.

Revamping manufacturing to improve competitive advantage 3

3 own manufacturing plants + 2 JV plants with a capacity of 30 million sq meters p.a spread across India.

Modernization of wall line at Sikandrabad (MP1) announced by Board in Jan-21 – total capex <Rs. 10 Crores increasing from 2.1 MSM to 2.8 MSM from mid-FY22

Enhancing Distribution Reach & Effectiveness 4

SKUs 3,000+

Channel Partners 2,000+

217

Orient Bell Tile Boutiques

Improved Distribution & Channel engagement

• CXO led meetings with channel partners to establish connect, resolve issues and identify growth opportunities.
• Project to add new Channel Partners 12.5% of sales in FY21.
• Empowered channel partners with digital tools to track SKU wise stock, Order status & Invoice details for ease of business.
• Working on connect with architects & Interior designers with a unique solution-based approach.

Focus on displays

• Launched 3 partnership models to strengthen chain of signature showrooms (OBTB).
• 54 Orientbell Tile Boutiques (OBTB) added in FY21- more to come.
• Refreshed existing OBTB displays with New category & HVP focus.
• OBTB focused digital tools to enhance customer experience.
• Increased depth in the market, including tier 2 & 3 cities.
• Digital lead generation model to increase OBTB footfalls.

Build Brand awareness and Preference 5a

Consumers today spend more time on their mobiles than on TV**.** 0ur brand-building approach is to meet consumers where they are with content that they can engage with. ✔

QUICKLOOK

Build Brand awareness and Preference 5b

5c 2020: Recognition of our Approach

Best Website of the Year

Awarded By: Realty+

Best omni-channel Model

Awarded By: Future of Retail (3rd Edition)

Google Case Study

making an example out of our best practice

6

Next phase: scaling -up

Scaling-up strategy for accretive value creation

Focus on 4 pillars to build customer preference for OBL

People

• Retention of key talent.
• Performance linked incentives for KMPs.
• Learning and development.
• Strengthening sales force new branches & augmenting frontline team.
• Safety and health measures.
• Company wide Reward & recognition program.
• Employee Engagement.
• Develop tools to enhance productivity.

Distribution & Display

• Add Orient Bell tile boutiques in focus geographies.
• Enhance distribution reach- New Channel partners and Category penetration in existing Channel.
• Enhance penetration with leading Builders.
• Build preference for OBL in the Architect & Interior Designer community with state of art tools.
• Target weak markets.

Product & Service

• Capture customer feedback and changing trends to differentiate portfolio.
• Increase categories from own manufacturing to provide a one stop shop for Channel.
• Premiumization of portfolio, increase in vitrified %.
• Relentless Quality focus.
• Ensure ease of doing business with OBL by improving service levels and transparency.

Digitally enabled Brand

• Aggressive brand building investments with focus on Digital to track ROI of efforts.
• Engage customers with an awardwinning website that enables Tile discovery & selection.
• Integrate online Lead generation with offline sales channel to build secondary sales.
• Project tracking tools to ensure systematic follow ups.
• Strengthen adoption of tools for Tile visualization & presentation.

We are focusing on building relationships with Retail & Institutional stakeholders aided with tools to remove friction in the buying process.

Recent sector trends to support growth

Improvingdomestic demand	Positiveimpactoffallinghomeloanratesandreductionintrustdeficit.Covid-19hasincreaseddemandforhomeimprovements&preferenceforbiggerhomes.Trendofgovernmentsprovidingrelieftorealtysector.
	Global customers are looking at countries besides China.
Morbimanufacturers	GCC exports continue unabated despite ADD imposition in Jun'20 largely attributed to Morbi's growingcompetitiveness, particularly in the ceramic wall and lower format GVT segment.
focused on exports	US imposition of ADD on China (~200%+); US has now become the second largest export destination forMorbi after GCC. Exports to UK and Europe also gaining strong traction.
	Channel partners prefer large branded players due to assured and faster supplies.
Organized players	Reduced discounting.
gaining share in	Better compliance on GST improving competitiveness of branded players.
domestic market	Increase in Gujarat gas pricing has reduced price gap between Morbi and branded players.
	OBL dependence on Morbi is the lowest amongst branded players.

Ensure sustainable and responsible growth

Location.

rainwater harvesting.

manufacturing facilities

Experienced Board of directors.

Empowered senior leadership team that have oversight and head dedicated departments

Organization wide Code of Conduct that reflects the company's principles

Continuous stakeholder engagement promoting transparency – Shareholder communications/ Employee townhalls, transparent Vendor

ecosystems

Historical Financial performance

Historical consolidated profit & loss statement

(Rs. Crores)	FY18	FY19	FY20
Revenue from operation	648.0	571.1	492.3
Cost of Goods Sold	287.7	256.7	236.3
Employee Benefit Expense	76.1	75.7	73.6
Other Expenses	237.1	201.8	156.4
Total Operating Expenses	600.8	534.1	466.2
EBITDA	47.2	37.0	26.1
EBITDA margin	7.3%	6.5%	5.3%
Other Income	2.4	1.9	5.3
Interest	7.3	8.7	8.1
Depreciation	15.0	16.5	20.6
Share of profit/(loss) of Associates	-0.2	0.4	0.3
Exceptional Item	20.3	-	-
PBT	47.3	14.1	2.9
Tax Expenses (Credits)	7.3	4.8	-4.2
PAT	40.0	9.3	7.1
PAT Margin	6.2%	1.6%	1.4%

Consolidated balance sheet

(Rs. Crores)	Sep'20	Mar'20
Share Capital	14.3	14.3
Reserves	218.1	225.3
Shareholders' Funds	232.4	239.6
Long Term Borrowings	28.1	33.4
Lease Liabilities	7.0	7.9
Other Long Term Financial liabilities	10.9	10.5
Deferred Tax Liabilities	18.5	22.0
Long Term Provisions	1.6	1.5
Total Non-Current Liabilities	66.1	75.2
Trade Payables	82.7	77.3
Lease Liabilities	2.0	2.2
Other Current Liabilities	16.1	19.4
Short Term Provisions	0.5	0.4
Short Term Borrowings	-	6.0
Total Current Liabilities	101.2	105.3
Total Liabilities	399.8	420.2

(Rs. Crores)	Sep'20	Mar'20
Fixed Assets incl. CWIP	218.1	225.5
Right-of-use assets	7.0	7.9
Non-Current Investments	7.0	7.0
Other Non Current Assets	4.5	4.0
Total Non-Current Assets	236.5	244.4
Inventories	59.4	80.6
Trade Receivables	67.8	86.9
Cash and Bank	32.5	3.0
Other Current Assets	3.6	5.3
Total Current Assets	163.2	175.8
Total Assets	399.8	420.2

Thank You

Orient Bell Limited

Mr. Himanshu Jindal – CFO

Mr. Ashish Kapur – AGM Treasury, Investor Relations & Corporate Finance

+91-11-4711-9100 (B)

investor@orientbell.com

www.orientbell.com

Pareto Capital (Investor Relations)

Ms. Pooja Dokania pooja.dokania@paretocapital.in

Mr. Rishav Das rishav.das@paretocapital.in