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Zen Technologies Ltd. Investor Presentation 2021
60795_rns_2021-04-14_fd59cf76-9beb-4f57-b606-bbd8015456fd.pdf
Investor Presentation
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ZEN TECHNOLOGIES LIMITED
Certified ISO 9001 :2015, ISO 27001 :2013, CMMI MLS Regd. Office : B-42, Industrial Estate, Sanathnagar, Hyderabad - 500 018, Telangana, India. Phone: +91 40 23813281/3294/2894/4894 Fax No: +91 40 23813694 Email: [email protected] Website: www.zen.in Corporate Identity Number: L72200TG1993PLC015939
Date: 14t11April2021
To BSE Limited Phiroze Jeejeebhoy Towers Dalal Street Mumbai- 400001 Through: BSE Listing Centre
National Stock Exchange of India Limited Exchange Plaza, C-1, Block G, Bandra Kurla Complex, Bandra (E), Mumbai - 400 051 Through: NEAPS
Security Code: 533339 Symbol/Security ID: ZENTEC
Dear Sir/Madam,
Sub: Outcome of Virtual Calls with Institutional Investors I Analysts
Ref: Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
To
With reference to the above captioned subject and in furtherance to our letter dated April 14th 2021, we're enclosing herewith the investor meet deck which was presented during the virtual call with the participants.
The above information is also available on the website of the Company: https://www.zentechnologies.com/corporate-announcements
This is for your kind information and records.
Thanking You.
Works: Plot 36, Hardware Park, Near Shamshabad International Airport, Hyderabad - 501 510, Telangana, India
Zen Technologies Limited Investor Meet Deck
India's leading defence training solution provider
NSE: ZENTEC BSE: ZENTEC - 533339 BLOOMBERG: ZEN IN REUTERS: ZETE.BO
Inside the Document
R&D – Our Strong Suit
New Product Additions
Investment Highlights
Zen Technologies at a glance
A pioneer in providing state of art Defence Training Solutions for imparting defense training and measuring combat readiness of security forces. The company is engaged in indigenous design, development and manufacturing of sensors and simulators technology based defence training systems.
*Order book as on 31st December 2020
Business Canvas
SALE OF EQUIPMENT
- A leader in manufacturing defence training solution with > 95% market share in tank simulators.
- Infrequent but large order size with long closing cycles is an inherent characteristic of this segment.
- Huge opportunity size in existing products with strong focus on R&D for continuous new additions to product basket.
- Focus on Anti-Drone Simulators
- A training platform to provide realistic battle experiences by integrating together the entire range of product offerings.
- Big ticket size offerings with potential order wins worth USD 25M for single installation.
- Expected growth in export market on the back of attractive EXIM financing options.
COMBAT TRAINING CENTRE ANNUAL MAINTENANCE CONTRACT
- A recurring revenue stream with superior profitability margins.
- Addition in simulator installations base leads to growth in revenues from AMC
- Growing service revenue from AMC ensures profitability even in absence and lumpiness of new equipment orders
- AMC revenues start kicking in after 3 years of equipment installation.
R&D – Our Strong Suit
At Zen, continuous research efforts have resulted in creation of diverse technological solutions and corresponding patent portfolio. Till date the company has filed for more than 109 patents for the pioneering initiatives undertaken, of which 27 have been granted.
- IP driven business with bill of materials not contributing to more than 10%-25% of the final product cost.
- Investments in R&D over the last years has resulted in continuous new product additions. The company has recently come out with Anti-Drone system technology and is making further investments in development of Air Defence Gun Simulators.
- Willing to take short term pain with possibility of longterm gains.
- Investments made in R&D written off in P&L
- High investments made in R&D throughout the lifetime of the company make creates high entry barriers for a new entrant.
New Product Additions
Anti-Drone Simulators & Drone Simulators
- With changing warfare dynamics, drones have become a major threat to any country's security.
- Authorities across the globe investing in technologies to neutralize this threat.
- Wide applications. Not only restricted to military training.
- A huge opportunity size.
- New products to contribute significantly to the revenues and profitability in the coming years.
New Product Additions
ZEN MEDICAL TECHNOLOGIES
Oxygen Enrichment Unit
*Design conceptual
Focus on Medical Simulators
Developed a Medical Ventilator
Received Transfer of Technology for Oxygen Enrichment Unit
Plans to introduce 2-3 new products in this segment by end of the year
Strategic Priorities
The business model of the company has been strategically positioned to reduce lumpiness and enhance the profitability in the coming years.
Continue to grow the sales of Equipment and expand the product portfolio with strong focus on emerging space Anti-Drone systems.
Scale the AMC business, where the contributions from AMC can take care of the fixed operating expenses.
Develop and expand the international presence and exports with friendly countries.
Continuously improve competitiveness, efficiency and drive operational excellence.
Strong Regulatory Tailwinds
The defence business is a regulated one, which is largely impacted by government policy and budget allocation to the sector. The government's keen focus on Make in India and Atmanirbhar Bharat campaign has created conducive environment
The Government of India (GOI) has formulated several measures along with strict implementation timelines.
- Import embargo on 101 items (9 items manufactured by Zen Technologies Limited) to enhance domestic manufacturing.
- Aligning Defence Acquisition Procedure (DAP), 2020, with the long-term goals of increase in indigenized content under various categories
- Aggressive push towards MAKE -2
- INR 52,000 crores allocated for equipment procurement from domestic defence industry.
- Exports target of INR 35,000 crores by 2025. Strong support to the industry for exports of equipment to friendly countries by offering attractive financing option through EXIM bank.
- Enhancement of FDI limit to 74% under automatic route.
- Significant reduction in receivables from government.
The confluence of all these factors provides for a strong regulatory tailwind for the Indian defence space.
Investment Merits
ASSET-LIGHT business model
INCREASING SHARE OF AMC which is annuity in nature
STRONG REGULATORY tailwinds
Focus on
INCREASING R & D SPENDS
with special emphasis on Anti-Drone systems for armed forces
STRONG BALANCE SHEET
with zero debt
Disclaimer
This document which have been prepared by Zen Technologies Limited (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 what so ever. 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 document 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 Document. This Document 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 Document is expressly excluded.
Certain matters discussed in this Document 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 cash flows, 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 Document. The Company assumes no obligation to update any forward-looking information contained in this Document. Any forward-looking statements and projections made by third parties included in this Document are not adopted by the Company and the Company is not responsible for such third-party statements and projections.
Let's connect
HANSRAJ SINGH RAJPUT
Company Secretary & Compliance Officer Zen Technologies Limited
DIWAKAR PINGLE
[email protected] Investor Relations Advisor Christensen IR
ABHISHEK MEHRA
Investor Relations Advisor The Investment Lab