Prataap Snacks Ltd Crispy delight for your portfolio

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TABLE OF CONTENTS

Summary 3 Valuation & Peer Comparison 4 Understanding the Business 9 Financial Analysis & Projections 12 Key Growth Drivers 17 Fast-growing under penetrated market 17 Benefit from PLI scheme for food processing industry 17 Two-pronged geographical expansion strategy 18 Establishing manufacturing hubs across India 20 Margin expansion on the cards 21 Balance Sheet Strength 22 Key Management Persons 23 Business Quality Score 24 Annual Report Takeaways 25 Quarterly Financials 28 Financial Statement Analysis & Projections 29 Disclaimer 30

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Selling nearly 11 million packets every day, Prataap Snacks Ltd (PSL) is one of India’s leading snacks food manufacturers and distributors. It operates out of 7 owned and 8 contract manufacturing facilities serving over 1.7 million retail touch points in 31 states and UTs across India. Its wide range of products are offered in 100+ SKUs across categories of Potato Chips, Extruded Snacks, Namkeen (traditional Indian snacks) under the Yellow Diamond and Avadh brands. Revenues are expected to grow at 18.9% CAGR to INR 1,966 cr over FY21-24 with an improvement in operating margins by 370 bps to 9.1% by FY24. Their growth strategy is based on two main pillars – a) geographical expansion in markets that have huge potential but in which PSL has a relatively low market share; and b) deeper penetration in existing markets. The company is transitioning to the asset light 3P model with decentralized operations. This enables it to directly distribute to the distributors and save on the ~6% margin that would have otherwise gone to the super stockists. The company has taken a number of sustainable cost-saving initiatives to offset the impact of the upward trending palm oil prices. These include reducing the size of packaging, changes in the placement of products in corrugated boxes, changes in recipes to use a lesser percentage of oil, manufacturing of certain flavours in-house, change in the distribution structure to eliminate the cost of super stockists and grammage rationalization. We expect margins to improve going forward based on the forecast that palm oil prices are going to fall by ~20% in the near future and PSL is looking to gain directly as and when this happens. We value PSL at INR 1,515 (38.9X FY24 earnings) and initiate coverage with a BUY. At the CMP of Rs 839 the price objective represents a potential upside of 80.1% over the next 24 months. Key Financial Data (INR Cr, unless specified)

Revenue EBITDA Net

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BVPS (₹)

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(X)

FY20 1394 94 47 6.7 3.4 20.0 259.2 7.7 5.1 41.9 3.2 21.2

FY21 1,171 63 14 5.4 1.2 6.0 265.7 2.3 1.3 139.0 3.2 31.6

FY22E 1,344 74 15 5.5 1.1 6.3 271.6 2.3 2.8 134.0 3.1 26.9

FY23E 1,723 133 56 7.7 3.2 23.7 294.2 8.1 10.6 35.4 2.9 14.8

FY24E 1,966 179 91 9.1 4.6 38.9 331.2 11.8 16.9 21.6 2.5 10.5

BUY @ CMP INR 839 Target: INR 1,515 in 18-24 months Upside Potential: 80.6%

Crispy delight for your portfolio

Industry Food Scrip Details Face Value (INR) 5.0 Market Cap (INR Cr) 1,968 Price (INR) 839 No of Shares O/S (Cr) 2.35 3M Avg Vol (000) 50 52W High/Low (INR) 909/485 Dividend Yield (%) 0.06 Shareholding (%) Promoter 71.5 Institution 21.5 Public 7.0 TOTAL 100.0 Price Chart

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Prataap Snacks Ltd

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Valuation We have used the DCF model to value PSL since it has a healthy and consistent cash generation over our forecast period i.e., till FY30. We have discounted back the future cash flows to FY24 and value the company at INR 1,515 per share, presenting an upside of 79.8% from the CMP of INR 839.

Long Term Market Return 12% Risk Free Rate 6% Cost of Equity 8%

Interest Rate 10% Tax Rate 25% Cost of Debt 7%

WACC 8%

Terminal Value Growth 4% Terminal Value 4,794

FY24E FY25E FY26E FY27E FY28E FY29E FY30E FCFF 96 108 123 146 163 177 198 Discount Factor from FY24 0.92 0.85 0.79 0.73 0.67 0.62 0.57 Discounted FCFF from FY24 89 92 97 107 109 110 113 Total of Discounted FCFF FY24 717 FY24 PV of Terminal Value 2,745 FY24 Value of Operations 3,462 FY24 Net Debt -91 FY24 Value of Equity 3,553 FY24 Value of Equity per share 1,515

Source: Ventura Research

DCF Valuation

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Source: Ventura Research

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Prataap DFM

Cheap valuations and strong business potential deserve re-rating

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Our Bull and Bear Case Scenarios We have prepared a Bull and Bear case scenario based on FY24 P/E ratios

Bull Case: We have assumed a 21.5% CAGR in revenue with net margin rising to 5.5%. Assigning a P/E of 40X in FY24 will result in a Bull Case price target of INR 1,978 per share (upside of 135.7% from CMP)

Bear Case: We have assumed a 15.4% CAGR in revenue and margins falling to 4.3%. Assigning a P/E of 35X in FY24 will result in a Bear Case price target of INR 1,155 per share (upside of 37.6% from CMP)

Bull & Bear Case Scenario

Source: Ventura Research

Bull Case Price INR 1,978 per share

Target Price INR 1,515 per share

Bear Case Price INR 1,155 per share

Current Price INR 839 per share

PE of 40.0X

PE of 35.0X

Valuation and Comparable Metric of Domestic and Global Food Manufacturing Companies

Source: Company Reports, Bloomberg & Ventura Research

Figures as mentioned

Company Name Mkt Cap PricePEG

2021-242021 2022 2023 2024 2021 2022 2023 2024 2021 2022 2023 2024 2021 2022 2023 2024 2021 2022 2023 2024 2021 2022 2023 2024 2021 2022 2023 2024 2021 2022 2023 2024

Domestic Peers (Fig in INR Cr)PSL 1,968 839 0.3 139.0 134.0 35.4 21.6 31.6 26.9 14.8 10.5 3.2 3.1 2.9 2.5 2.3 2.3 8.1 11.8 1.3 2.8 10.6 16.9 1,171 1,344 1,723 1,966 5.4 5.5 7.7 9.1 1.2 1.1 3.2 4.6DFM Foods 1,435 285 - 50.0 34.8 23.0 - 26.0 21.8 15.2 - 8.1 7.0 5.9 - 16.1 20.1 25.5 - 22.6 30.1 40.6 - 524 573 687 - 10.6 11.5 13.5 - 5.5 7.2 9.1 -Varun Beverages 37,667 864 - 93.4 36.9 29.5 - - 18.2 15.7 - 25.5 7.5 6.2 - 27.3 20.3 21.0 - - 24.5 28.5 - 7,126 10,110 11,170 - 18.4 21.2 21.6 - 5.7 10.0 11.4 -Hatsun Agro 27,857 1,292 2.5 113.1 101.0 78.3 59.3 37.4 - - - 27.3 22.7 19.4 15.9 24.1 22.5 24.8 26.8 20.5 - - - 5,570 6,706 7,778 9,022 14.0 11.7 11.7 - 4.4 4.1 4.6 5.2Zydus Wellness 12,217 1,905 0.6 102.9 36.7 28.6 30.4 36.3 - - - 2.7 2.5 2.3 2.2 2.6 6.9 8.2 7.2 6.6 - - - 1,867 2,099 2,361 2,596 18.4 20.1 20.6 - 6.4 15.7 17.9 15.3Nestle, India 1,86,594 19,353 3.6 86.4 77.7 66.3 55.8 - 44.6 39.2 - - 65.3 53.9 31.9 116.9 84.1 81.3 57.1 - - - - 13,636 14,700 16,700 20,831 24.5 28.0 27.8 25.1 15.8 16.3 16.9 16.0Britannia 85,473 3,538.8 4.4 45.9 47.6 41.2 36.1 34.3 35.1 32.8 29.6 24.1 21.5 17.6 14.7 52.5 45.2 42.8 40.7 56.5 49.4 50.6 67.2 13,136 14,052 15,518 17,148 19.1 17.4 16.8 16.5 14.2 12.7 13.3 13.8Global Peers (Fig in USD mn)Pepsi, USA 2,38,314 172 2.9 27.5 25.6 23.7 22.1 18.8 17.5 16.3 14.9 13.7 12.7 12.0 13.2 49.8 49.7 50.7 59.9 23.6 24.9 26.4 31.0 78,455 81,528 85,011 88,589 18.3 18.9 19.4 20.2 11.1 11.4 11.8 12.2Kellogs, USA 21,815 64 9.2 15.4 15.4 15.0 14.7 12.6 12.4 11.9 11.4 5.9 4.8 4.4 4.1 38.2 31.4 29.5 28.1 16.9 16.4 16.5 17.1 14,121 14,353 14,569 14,745 16.1 16.1 16.2 16.4 10.0 9.9 10.0 10.0UTZ, USA 2,210 16 - 26.1 27.6 24.3 - 18.6 16.5 14.5 13.5 3.1 3.0 2.8 - 11.8 10.8 11.5 - 8.8 9.8 12.0 - 1,175 1,234 1,274 1,314 13.6 14.3 15.1 15.6 7.2 6.5 7.1 -Celsius Holdings, USA 5,503 74 0.4 544.2 187.4 84.7 51.6 199.0 98.5 51.0 - 27.9 22.9 17.0 17.7 5.1 12.2 20.0 34.3 12.1 33.9 61.9 - 300 489 722 955 9.0 11.2 14.4 16.0 3.4 6.0 9.0 11.2Mondelez, USA 92,082 66 3.2 22.6 21.4 20.2 19.0 18.3 17.5 16.8 15.4 3.3 3.3 3.2 3.1 14.8 15.3 16.1 16.2 10.9 11.3 11.7 12.3 28,652 29,815 30,837 32,001 20.7 21.1 21.2 22.1 14.2 14.4 14.8 15.1Nissin Foods, HK 800 1 - 20.3 17.9 15.5 - 7.4 6.4 - - 1.6 1.5 1.4 - 7.7 8.4 9.2 - 22.2 24.3 - - 476 518 569 - 14.8 15.4 17.2 - 8.3 8.6 9.1 -OATLY, USA 16,653 86 7.5 56.7 51.9 50.0 47.1 28.8 27.2 25.7 24.4 5.9 5.6 5.2 4.8 10.4 10.9 10.5 10.3 14.8 16.1 16.3 16.3 4,145 4,412 4,657 4,901 13.8 13.7 13.7 13.6 7.1 7.3 7.2 7.2Kraft Heinz, USA 4,616 8 - (24.3) (25.7) (48.0) 54.3 (32.7) (53.0) 130.4 - 3.7 4.2 4.3 - (15.0) (16.2) (9.0) - (19.3) (12.6) (4.8) - 636 1,028 1,555 2,087 (20.4) (8.8) 2.5 12.4 (29.9) (17.5) (6.2) 4.1General Mills, USA 43,894 36 83.2 12.8 13.6 13.3 12.7 10.2 10.5 10.1 9.5 0.9 0.9 0.8 0.8 6.8 6.3 6.3 6.4 7.4 7.0 7.1 7.4 25,892 24,746 24,845 25,018 24.1 24.0 24.3 24.8 13.2 13.1 13.3 13.8Nestle, SA 40,348 67 8.6 17.2 17.5 16.9 16.3 13.4 13.9 13.4 12.9 4.3 4.2 4.0 3.9 24.9 24.0 23.4 24.2 15.0 14.9 15.4 16.5 18,127 18,805 18,814 19,022 21.4 19.7 20.1 20.4 12.9 12.3 12.7 13.0

EBITDA Margin (%) Net Margin (%)P/E (X) EV/EBITDA (X) P/BV (X) RoE (%) RoIC (%) Sales

Source: Ventura Research & Bloomberg; *DFM Foods Ltd is plotted as per FY23 forecasts

PSL

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Zydus Wellness

Nestle, India

Britannia

Pepsi, USA

Kellogs, USACelsius Holdings, USA

Mondelez, USAOATLY, USA

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PSL at attractive valuations

9 | P a g e ( 6 t h J a n 2 0 2 2 )

Understanding the Business In a cluttered Indian snacks market with ~40 organized players, PSL is one of India’s fastest growing snack food companies with a ~5% market share. It has 15 manufacturing facilities (7 in-house and 8 contract manufacturing units) producing over 100 SKUs under the brand name ‘Yellow Diamond.’ Its products are made available across 1.7 mn touch points via a 4300 strong distributor network. The wide product portfolio includes - Chips, Chulbule, Rings, Puffs, Namkeen, Pellets and Sweets.

Diverse product portfolio at strategic price points and pack sizes

Source: Company Reports The company, under the brand name ‘Rich Feast’ offers a wide range of sweet snacks. This segment offers multiple synergies such as creating a differentiated position for the Brand and Company, lower volatility in raw material cost, higher gross margin and appealing to different customer sensibilities.

Sweet snacks portfolio available at various SKUs

Source: Company Reports

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The company has two subsidiaries, viz. Avadh Snacks Private Limited (Avadh) and Red Rotopack Private Limited (Red Rotopack). Avadh has a well-diversified and strong product portfolio of namkeens like bhujia, chevda, fafda, gathiya, etc. and extruded pellets like wheels, cups, pasta, etc. with a strong presence in the state of Gujarat and expanding to Maharashtra, Rajasthan and Uttar Pradesh. Red Rotopack has been incorporated for a backward integration to manufacture and supply packaging material for Avadh’s products.

Holding Structure

Source: Company reports Awadh, with a manufacturing facility at Rajkot, is the 4th largest (~6% market share) and one of the fastest growing snacks players (25% revenue CAGR over past 5 years) in Gujarat. Since the Rajkot facility is in close proximity to the target markets it directly supplies to distributors eliminating the need for any super stockists. This helps keeps distribution costs in check. The company is now targeting to launch Awadh Namkeens in regions outside Gujarat.

Awadh product portfolio

Source: Company Reports

Prataap Snacks Ltd.

Avadh Snacks Pvt Ltd. (90.48% Subsidiary)

Red Rotopack Pvt Ltd. (100% Subsidiary)

11 | P a g e ( 6 t h J a n 2 0 2 2 )

The company, over the years, has built a strong business by leveraging its innovation capabilities adding new categories and introducing new products. In FY21, it launched Plain Cut Chips (in four flavours), Rusk and Foochka. In the current fiscal, it has launched Swiss Rolls under Rich Feast (in two flavours).

Innovation Track Record

Source: Company Reports

Source: Company Reports

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Financial Analysis and Projections Over FY18-21, PSL grew its revenue at 4.8% CAGR to INR 1,171 cr. However, the pandemic induced slowdown and commodity inflation from rising palm oil prices and packaging laminates impacted the profitability. EBITDA/ PAT witnessed a fall of 167.5%/184.8% to INR 63 cr/ INR 14 cr, respectively. EBITDA and net margins fell by by 320 bps (to 5.4%) and 310 bps (to 1.2%), respectively over the same period. Consequently, return ratios – RoE & RoIC – too, fell by 620 bps (to 2.3%) and 1680 bps (to 1.3%), respectively.

Quarterly Sales Trend

Source: Company Reports and Ventura Research

Quarterly Profitability Metrics

Source: Company Reports and Ventura Research

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PSL’s Cost and EBITDA Analysis

_______________________________________________________________________________________________________ Source: Company Reports and Ventura Research

Had it not been for cost saving and efficiency initiatives introduced by the company, the fall could have been much worse. Cost cutting measures introduced include

Packaging at 16% of revenue is a significant cost element. By reducing the size of packaging, even the size of corrugated boxes (6-7% of revenue) fell. This helped ship more volume per freight trip which in turn lead to savings on logistics costs.

Changes in placement

Better placement of products in packaging has helped improve volumes transported and lower logistics cost

Change in recipe without compromising on taste PSL reduced the percentage of oil and increased other ingredients without compromising on taste. Also, certain flavours which were previously outsourced are now being manufactured in-house.

Flattening the distribution structure

The company has historically been following a 3-tier distribution system in which the super stockists would gain a ~6% margin. Since June 2021, PSL is trying to move to a 2-tier distribution system (by eliminating the super stockist), thereby saving on the super stockist margins. Till September 2021, 65% of their target was already achieved leading to a 2.5% rise in the EBITDA margin.

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Grammage rationalization The INR 5 SKUs (core SKUs) constitute ~80% of the company’s revenues. These haven’t been modified. However, the non-core SKUs have witnessed a reduction in grammage

Discontinuation of thin margin products The company is taking out the products that do not contribute significantly towards margin.

Over the period of FY21-24E, we are expecting revenues to grow at a CAGR of 18.9% to INR 1,966 cr, driven by –

Expanding reach in low market share areas of UP, Bihar, Punjab, Jammu and Kashmir, Himachal Pradesh and South India

Deeper penetration in existing markets through tele-calling. Incentives from the PLI scheme announced by the government for the food processing

sector.

As a result of the cost cutting and efficiency measures introduced along with softening oil prices, we expect EBITDA margins to improve by 370 bps (to 9.1%) leading to EBITDA growing at a CAGR of 41.7% INR 179 cr by FY24. This is expected to lead to a resurgence in net earnings to INR 91cr (+86.1% CAGR) with margin improving by 340 bps to 4.6% over the same period.

Subsequently, return ratios RoE & ROIC are expected to improve by 950 bps (to 11.8%) & 1560 bps (to 16.9%) respectively by FY24.

Super Stockists

Distributors

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Retailers

15 | P a g e ( 6 t h J a n 2 0 2 2 )

Financial Summary

Source: Company Reports & Ventura Research

Fig in INR Cr (unless specified) FY18 FY19 FY20 FY21 FY22E FY23E FY24E FY25E FY26E FY27E FY28E FY29E FY30ERevenue from operations 1,017.4 1,170.6 1,393.8 1,171.1 1,343.6 1,722.6 1,966.1 2,232.2 2,515.3 2,818.8 3,074.4 3,412.6 3,788.0YoY Growth (%) 13.8 15.1 19.1 (16.0) 14.7 27.0 13.5 13.0 13.0 12.0 11.0 11.0 11.0Raw Material Cost 686.2 820.4 994.7 843.1 992.0 1,242.2 1,394.4 1,582.3 1,780.5 1,994.2 2,164.4 2,402.5 2,666.7RM Cost to Sales (%) 67.5 70.1 71.4 72.0 73.8 72.1 70.9 70.9 70.8 70.7 70.4 70.4 70.4Employee Cost 36.5 41.5 57.7 53.3 62.4 74.8 82.3 90.6 101.4 113.6 125.0 137.5 151.2Employee Cost to Sales (%) 3.6 3.5 4.1 4.6 4.6 4.3 4.2 4.1 4.0 4.0 4.1 4.0 4.0Other Expenses 207.7 225.4 247.7 211.6 215.5 273.0 309.9 350.2 395.7 443.2 491.9 546.0 606.1Other Expenses to Sales (%) 20.4 19.3 17.8 18.1 16.0 15.8 15.8 15.7 15.7 15.7 16.0 16.0 16.0EBITDA 86.9 83.2 93.7 63.1 73.7 132.5 179.5 209.2 237.6 267.8 293.2 326.6 364.0YoY Growth (%) 106.2 (4.3) 12.6 (32.7) 16.8 79.9 35.4 16.6 13.6 12.7 9.5 11.4 11.4EBITDA Margin (%) 8.5 7.1 6.7 5.4 5.5 7.7 9.1 9.4 9.4 9.5 9.5 9.6 9.6Net Profit 44.2 44.6 46.9 14.2 14.7 55.7 91.3 112.7 137.2 165.0 190.4 222.8 259.0YoY Growth (%) 114.7 1.0 5.1 (69.8) 3.7 278.9 64.0 23.5 21.8 20.3 15.4 17.0 16.3Net Margin (%) 4.3 3.8 3.4 1.2 1.1 3.2 4.6 5.0 5.5 5.9 6.2 6.5 6.8

Adjusted EPS 18.8 19.0 20.0 6.0 6.3 23.7 38.9 48.1 58.5 70.4 81.2 95.0 110.4P/E (X) 44.5 44.1 41.9 139.0 134.0 35.4 21.6 17.5 14.3 11.9 10.3 8.8 7.6Adjusted BVPS 221.5 239.4 259.2 265.7 271.6 294.2 331.2 376.8 432.4 499.2 576.4 666.6 771.5P/BV (X) 3.8 3.5 3.2 3.2 3.1 2.9 2.5 2.2 1.9 1.7 1.5 1.3 1.1Enterprise Value 1,761.0 1,903.9 1,987.5 1,994.8 1,985.0 1,961.1 1,876.6 1,775.4 1,653.6 1,500.4 1,320.8 1,115.4 875.9EV/EBITDA (X) 20.3 22.9 21.2 31.6 26.9 14.8 10.5 8.5 7.0 5.6 4.5 3.4 2.4

Net Worth 519.5 561.4 608.0 623.1 637.1 689.9 776.6 883.7 1,014.1 1,170.8 1,351.7 1,563.4 1,809.5Return on Equity (%) 8.5 8.0 7.7 2.3 2.3 8.1 11.8 12.8 13.5 14.1 14.1 14.3 14.3Capital Employed 527.0 579.2 681.3 680.4 698.3 755.2 845.9 964.0 1,112.3 1,287.1 1,493.0 1,738.6 2,026.7Return on Capital Employed (%) 7.7 6.3 6.5 1.6 2.1 7.5 10.7 10.9 11.0 10.9 10.3 9.9 9.5Invested Capital 312.6 497.3 627.5 650.0 654.1 683.2 685.3 691.2 699.7 703.3 704.6 710.8 717.5Return on Invested Capital (%) 18.1 9.2 5.1 1.3 2.8 10.6 16.9 20.4 23.3 26.6 29.1 32.3 35.7

Cash Flow from Operations 83.7 10.8 75.1 77.4 64.3 93.7 146.5 167.0 197.3 231.7 268.5 307.8 355.2Cash Flow from Investing (201.8) (59.3) (49.3) (77.8) (50.7) (66.8) (54.7) (57.0) (64.5) (64.7) (71.8) (81.4) (90.0)Cash Flow from Financing 162.7 8.0 (28.0) (14.3) (2.4) (4.9) (7.0) (1.8) 2.6 (0.6) 3.1 7.7 10.2Net Cash Flow 44.7 (40.5) (2.2) (14.7) 11.1 22.0 84.9 108.2 135.4 166.5 199.8 234.0 275.5Free Cash Flow 32.4 (18.8) 35.4 45.4 15.9 40.4 96.3 108.3 123.3 146.5 162.6 177.1 197.9FCF to Revenue (%) 3.2 (1.6) 2.5 3.9 1.2 2.3 4.9 4.9 4.9 5.2 5.3 5.2 5.2FCF to EBITDA (%) 37.3 (22.6) 37.8 72.0 21.5 30.5 53.6 51.8 51.9 54.7 55.5 54.2 54.4FCF to Net Profit (%) 73.4 (42.2) 75.4 320.7 108.0 72.5 105.5 96.1 89.9 88.8 85.4 79.5 76.4FCF to Net Worth (%) 6.2 (3.4) 5.8 7.3 2.5 5.9 12.4 12.3 12.2 12.5 12.0 11.3 10.9

Total Debt 7.5 17.9 73.3 57.2 61.2 65.2 69.2 80.2 98.2 116.2 141.2 175.2 217.2Net Debt (206.9) (64.0) 19.5 26.8 17.0 (6.8) (91.3) (192.5) (314.4) (467.5) (647.1) (852.6) (1,092.0)Net Debt to Equity (X) (0.4) (0.1) 0.0 0.0 0.0 (0.0) (0.1) (0.2) (0.3) (0.4) (0.5) (0.5) (0.6)Net Debt to EBITDA (X) (2.4) (0.8) 0.2 0.4 0.2 (0.1) (0.5) (0.9) (1.3) (1.7) (2.2) (2.6) (3.0)Interest Coverage Ratio (X) 19.5 53.0 4.3 1.4 3.2 12.0 17.9 19.6 19.0 18.2 16.6 15.1 13.6

16 | P a g e ( 6 t h J a n 2 0 2 2 )

______________________________________________________________________________________________________________________________________________ Source: Company Reports and Ventura Research; *approximate percentages, not accurate

(20)

(15)

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Robust revenue growth expected

Revenue YoY Growth (%)

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Rings Chips Chulbule Namkeen Pellets Sweets

012345678910

020406080

100120140160180200

FY18 FY19 FY20 FY21 FY22E FY23E FY24E

High margin expansion on the cards

EBITDA Net Profit

EBITDA Margin (% RHS) Net Margin (% RHS)

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Trajectory of return ratios

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Debt Profile

Total Debt Net Debt

Net Debt to Equity (X) Net Debt to EBITDA (X)

(100)(50)050100150200250300350

(50)

0

50

100

150

200

FY18 FY19 FY20 FY21 FY22E FY23E FY24E

Healthy cash generation expected

CFO FCF

CFO to EBITDA (%) FCF to Net Profit (%)

Prataap Snacks Story in Charts

INR Cr

INR Cr

17 | P a g e ( 6 t h J a n 2 0 2 2 )

Key Growth Drivers Fast-growing under penetrated market augurs well for PSL The salty snacks market size is estimated at INR 300 billion with western snacks and Indian namkeen (traditional snacks) each having an equal share of INR 150 billion. This category has been growing at a faster ~11-12% CAGR over the last few years compared to the INR 300 bn sweets category (including biscuits and cakes) which has been growing at around 6-8% CAGR. In 2020, the sales volume of savoury snacks in the Indian packaged food market amounted to 1,335 thousand metric tonnes.

Savoury snacks sales volume (in ‘000 MT)

Source: Statistica.com and company reports According to Modor Intelligence, the India food and beverage packaging market was valued at USD 33.2 billion in 2020. This is expected to reach USD 156.2 billion by 2026, registering a CAGR of 29.8% during the forecast period (2021-2026). The western salty snacks category has huge opportunity to grow as it is present in only 4 million out of 12 million stores in India. This under penetrated market coupled with the large presence of the unorganised sector, and increasing health awareness leading to consumers switching from loose to packaged food products across all segments, presents a significant opportunity for organised players, like PSL, to gain market share. PSL to benefit from the PLI Scheme for food processing industry – The INR 10,900 crore PLI scheme is expected to give a big boost to the food processing industry. Most of PSL’s product segments are eligible for the incentives however, we do not expect the

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18 | P a g e ( 6 t h J a n 2 0 2 2 )

company to meet the eligibility criteria (i.e., sales CAGR of 10% over base year i.e., FY20) for incentive in FY22. We expect the company to benefit from the scheme over the years FY23-27 and the total incentive to add up to INR 181 cr.

Two-pronged geographical expansion strategy to drive growth

Expanding presence in underserved markets PSL, despite having a pan India presence across 31 states and UTs, realizes that there are still some markets with huge potential where its presence is weaker than others. These include Uttar Pradesh, Bihar, Punjab, Jammu and Kashmir, Himachal Pradesh and South India. To spear head growth from these underserved markets, PSL is embarking on enhancing its distribution network in these markets.

Market Study

Strong Foothold (>50% contribution to revenue)

MP, Mumbai, Delhi, Haryana, Odisha, WB

Low Market Share

UP, Bihar, Punjab, J&K, Himachal, South India

Salient features of the PLI scheme:

For FY22-25

1. Minimum sales CAGR should be 10% over base year of FY20

2. Incentive of 7.50% on incremental sales

For FY26

1. Minimum sales CAGR should be 10% over base year of FY22

2. Incentive of 6.75% in incremental sales

For FY27

1. Minimum sales CAGR should be 10% over base year of FY23

2. Incentive of 6.0% on incremental sales

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Deeper Penetration in Existing Markets PSL realized that existing markets where it has a strong presence still has significant scope for growth through deeper penetration. To achieve this objective, it roped in Vector Consultants and a tele-caller strategy was devised to enhance penetration. This was to be done in 3 stages –

1. A salesman would identify all relevant outlets present is a particular area via geotagging.

2. He would then on-board the outlets which did not sell products manufactured by PSL 3. Once a retailer was on-boarded, the tele-caller would initiate a call on a pre-scheduled

date, process the order win and share it with the respective distributor, who would in turn service the outlet.

This strategy coupled with data analytics has enabled PSL not only deepen penetration but also pitch new products & SKUs. Introduction of AI has also enabled PSL identify products which are gaining good traction that certain retailers might not be placing orders for. The success of this strategy can be highlighted from the pilot project carried out in Indore. In a market with a universe of 8,000 outlets PSL has enhanced its presence to 5500 outlets from a prior 3,500. This is a stellar response. Given the success of this tele-calling strategy, PSL expects to enhance its presence to 1 million outlets by FY24

Expectation for number of outlets under direct distribution through tele-calling

Source: Ventura Research

65,000

2,50,000

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0

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Nov'21 Apr'22E Mar'23E Mar'24E

Num

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on-

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20 | P a g e ( 6 t h J a n 2 0 2 2 )

Establishing manufacturing hubs across India – PSL has a pan India presence with 15 manufacturing facilities strategically located to cater to regional demand. Of these, 7 facilities are in-house whereas 8 are contract manufacturing facilities. Its mother plant is located in Indore and is the only plant that manufactures and distributes sweet snacks to the rest of the country. The company has identified facilities at Hisar and Bengaluru for upgradation into hubs. These hubs will manufacture the entire product range and cater to proximate markets in order to optimize distribution with cost efficiency. The company has committed to a capex of INR 100 cr by FY23 for this purpose. Out of this, INR 20 cr has already been spent and INR 10 cr is to be incurred by third parties. The remaining INR 70 cr will be incurred by the company and be funded solely through internal accruals. It is also planning to set up another facility in North India which could be an integrated and bigger one.

Product wise manufacturing presence in regions

Source: Ventura Research

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Margin expansion on the cards – Prior to 2019 palm oil prices had been stagnant for almost 8 years. Palm oil is a vital raw material in the production of snacks. Since September 2019 palm oil future prices have shot up to a record 108% in 24 months before cooling off to INR 1,085 in December 2021.

Historical price chart of crude palm oil futures vs company EBITDA (in INR)

Source: Investing.com Every 500bps change in palm oil prices affects the EBITDA margin of the company by 100 bps. The sharp upward spike in palm oil prices led to EBIDTA margins contracting 60 bps YoY to 6.6% in Q2FY22. This was partially offset by cost saving initiatives taken by the company. The sharp movement in palm oil prices was primarily due to the pandemic induced supply side shortages. Due to palm oil being one of the most common household commodities, we expect the prices to cool off as the supply constraints ease. This coupled with the cost saving and efficiency enhancement measures initiated by the company (spelt out on Page 13 of the report) should lead to a faster margin recovery to 9.1% (+370 bps over FY21) by FY24.

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22 | P a g e ( 6 t h J a n 2 0 2 2 )

Strong Balance Sheet enables capex through internal accruals PSL, compared to peers, has very low leverage. The company has a marginal INR 10 cr in short term borrowings (at 4.5% coupon) with no long-term debt. Its cash earnings have been more than sufficient to fund all expenditures and we expect this trend to continue. We expect net debt to EBITDA and net debt to equity to be -0.9X and -0.2X by FY24 respectively.

Healthy balance sheet compared to other players across the globe

Source: Company Reports & Bloomberg

PSLDFM Foods

Hatsun Agro

Zydus Wellness

Britannia

Pepsi, USA

Kellogs, USA

UTZ, USA

Celsius Holdings, USA

Mondelez, USA

Nissin Foods, HK

OATLY, USAKraft Heinz, USA

General Mills, USA

Nestle, SA

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23 | P a g e ( 6 t h J a n 2 0 2 2 )

Key Management Personnel

Source: Company reports

KMP Designation Description

Arvind mehtaChairman and Executive Director

Over 32 years of experience in real estate business along with over 18 years in the snacks food industry and in the financing business.

Amit kumatManaging Director and Chief Executive Officer

Over 25 years of experience in the snacks food industry.

Saloni Satish Wagh Whole-time Director

She holds a bachelor’s degree in science from Parle Tilak Vidhyalaya Association’s Sathaye College, University of Mumbai, Mumbai, a master’s degree in science from Institute of Science, University of Mumbai, Mumbai and a PhD in chemistry from the Faculty of Science, Pacific University, Udaipur.

Apoorva kumatExecutive Director (Operations)

Over 25 years of experience in the snacks food industry.

Sumit Sharma CFOMember of Institute of Chartered Accountants of India. He has over 19 years of experience in accounting, finance, banking and taxation and worked with Crompton Greaves, L&T and New Holland Group.

Subhash BhattVice President - Operation

He holds a bachelors degree in Engineering. He has over 25 years of experience in the snacks food industry and worked with Prakash Snacks, Hello Agro and Haldiram.

Mahesh PurohitGeneral Manager Sales - West

He holds a bachelors degree in Commerce. He has over 24 years of experience in the FMCG industry and worked with Parke-Davis, BPL Synergy and Candico.

Subhashis Basu COOHe holds a bachelors degree in Science (Economics). He has over 29 years of experience in the FMCG industry and worked with Parle, PepsiCo India and Mother Dairy.

B. Parameswaran Production Head

Qualified from University of Agricultural Sciences, Bangalore. Certified course in Baking & Confectionery. He has 35 years of experience in Biscuit & Cake manufacturing industry and worked with Kwality Biscuits and Anmol Biscuits.

D.V. Praveen Kumar General Manager Sales - South

He holds a bachelors degree in Commerce. He has over 33 years of experience in food & beverages, FMCG, dairy, confectioneries, cosmetics and edible. Worked with PepsiCo for more than 21 years.

Deepak BrahmeVice President - Operation

He holds a bachelors degree in Science. He had over 25 years of experience in the snacks food industry and worked with Prakash Snacks and Hello Agro.

Awadh Bihari SinghGeneral Manager Sales - East

He holds a bachelors degree in Science (Hons.). He has over 33 years of experience in the FMCG industry and worked with Prakash Snacks and Hello Agro.

24 | P a g e ( 6 t h J a n 2 0 2 2 )

Business Quality Score

Key Criteria Score Risk Comments Management & Leadership

Management Quality 8 Low The management is of high quality and has been able to deliver on guided lines; investor-friendly with timely updates on developments

Promoters Holding Pledge 10 Low The promoter holding is 71.5% and there is no promoter pledging as of 30th Sept 2021.

Board of Directors Profile 7 Low The average experience of directors is >20 years with significant experience in packaged food industry, strategy and planning and financial knowledge

Industry Consideration

Industry Growth 8 Low Salty snacks is an INR 300 bn market which has been growing at 11% in the past few years, growth is expected to remain in these levels

Regulatory Environment or Risk 8 Low Food & Processing is one of the largest manufacturing industries and contributes significantly to the GDP. We do not forsee any radical regulatory shifts that could impair growth

Entry Barriers / Competition 5 Medium The industry faces competition from the unorganized market

Business Prospects

New Business / Client Potential 8 Low Implementation of tele-calling is going to help with deeper penetration in existing markets. The company is also looking to expand geographically in the low market share areas.

Business Diversification 6 Low The business is always innovating and adding to their product portfolio but as expertise lies in sweet and salty snacks, the company is going to stay on course

Margin Expansion Potential 9 Low Fall in the over inflated oil prices will cause margin expansion, forecasting double digit EBITDA within 2 years

Earnings Growth 10 Low With volume growth and margin expansion in place, we are expecting strong earnings growth in the coming years

Market Share Potential 8 Low PSL has ~5% overall market share and with tele-calling and geographical expansion plans, market share gains are very much on the cards

Valuation and Risk

Balance Sheet Strength 10 Low The company has no long-term debt and we do not expect it to need any in the coming years

Debt Profile 10 Low It has a very minimal working capital loan of INR 10 cr @ 4.5% int which it has invested in a fixed deposit. The loan is just to maintain relations with the bankers.

FCF Generation 10 Low With all the key drivers in place, we are expecting positive FCF generation.

Dividend Policy 10 Low Company has consistently had a dividend payout ratio of ~5% since listing and we expect it to continue doing so

Total Score 127 Low The overall risk profile of the company is good and we consider it as a LOW-risk company for investments Ventura Score 85

______________________________________________________________________________________________________________________________ Source: Company Reports & Ventura Research, Total score ≥ 75 = low risk; 50 ≥Total score ≥ 75 = medium risk; Total score ≤ 50 = high risk

25 | P a g e ( 6 t h J a n 2 0 2 2 )

Annual Report Takeaways Transforming into an asset-light model through third party (3P) manufacturing facilities The company has seven owned and eight third-party (3P) manufacturing units. To ensure faster replenishment of products at store shelves with lower logistics cost, manufacturing facilities must be located in close proximity to target markets. Especially for chips and extruded snacks, the transportation cost is comparatively high. Hence, PSL is leveraging its asset-light third-party manufacturing model to enjoy three key advantages:

1. Lower time to market and faster replenishments, enabling better shelf availability, 2. Saving in freight cost due to lower distance from factory to market 3. Reduced fixed cost base enabling higher flexibility and improved capital efficiency

The share of the company's sales from 3P manufacturing facilities increased from 18% in FY 2020 to 24% in FY 2021. Direct Distribution Network and Tele-calling PSL is restructuring its distribution network, starting with selected markets. The company plans to deliver products directly from its factories to the distributors instead of taking the super-stockists route to save on the second-leg of the logistics cost. This will lead to an optimised cost and improved distribution structure. Improving product mix with high margin sweet snacks segment PSL intends to improve its product mix by increasing its revenue share from the sweet snacks segment while continuing INR 5 price point as an important growth strategy. The sweet snacks business offers multiple synergies such as creating a differentiated position for the Brand and Company, lower volatility in raw material cost, higher gross margin and appealing to different customer sensibilities.

Expanding Avadh portfolio outside Gujarat Acquisition of Avadh Snacks in 2018 has deepened the company's presence in Gujarat, which is one of the prominent snacks markets, with the highest per capita consumption. Awadh has a manufacturing facility at Rajkot and a well-established direct distribution network in Gujarat. PSL concluded the first phase of capacity expansion by 50% at Avadh in June 2020 with further plans of doubling the capacity from pre-expansion levels in a second phase. The company is now targeting to expand its extensive product portfolio of Avadh outside Gujarat. It has already launched a range of pellet-based snacks in northern markets and is gaining positive traction. The company is now targeting to launch Avadh Namkeens in other regions outside Gujarat.

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Details on Board of Director and KMPs

Board of Directors & KMP FY18 FY19 FY20 FY21 Arvind Mehta Chairman Amit Kumat MD & CEO Apoorva Kumat ED (Operations) G.V. Ravishankar NEND V.T. Bharadwaj NEND ID Vineet Kumar Kapila ID Anisha Motwani ID Chetan Kumar Mathur ID Haresh Ram Chawla ID Sumit Sharma CFO Subhashish Basu COO

MD - Managing Director ID - Independent Director NEND – Non-Executive Nominee Director CFO - Chief Financial Officer

CEO - Chief Executive Officer ED - Executive Director

Company Reports & Ventura Research Pay Grades Remuneration growths of the Chairman, MD, ED (Operations), CFO and COO are more than the 4-year CAGR in revenue/EBITDA/PAT which is 4.8%/-167.5%/-184.8%.

Remuneration in the last 4 years

Parameter (Fig in INR Lakhs) FY18 FY19 FY20 FY21 CAGR% Chairman 56 75 75 68 6.3 Share in Total Employee Cost (%) 1.5 1.8 1.3 1.3 MD & CEO 56 75 75 68 6.3 Share in Total Employee Cost (%) 1.5 1.8 1.3 1.3 ED (Operations) 56 31 75 68 6.3 Share in Total Employee Cost (%) 1.5 0.8 1.3 1.3 CFO 31 40 46 46 14.4 Share in Total Employee Cost (%) 0.8 1.0 0.8 0.9 COO 104 122 138 129 7.5 Share in Total Employee Cost (%) 2.8 2.9 2.4 2.4 Median remuneration of employees 2.1 2.2 2.6 2.5 4.6 Employee Cost 3,652 4,154 5,770 5,331 13.4 Employee Cost as a % of Revenue 2.9 2.9 4.4 4.3

Source: Company Reports & Ventura Research

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Auditor qualifications & significant notes to accounts SRBC & Co LLP is the auditor and there were no qualifications/emphasis of matters highlighted by them in FY21 Annual Report. Contingent Liabilities Contingent liabilities are mostly on account of disputed income tax liabilities

Contingent liabilities are very low

Parameters (Fig in INR lakhs) FY17 FY18 FY19 FY20 FY21

Income Tax/VAT/CST 21.4 - - 276.1 570.5

Transactions as a % of Revenue 2% 0% 0% 20% 49%

Transactions as a % of Net Worth 9% 0% 0% 45% 92% Source: Company Reports & Ventura Research

Major Related Party Transactions with promoters, KMPs and promoter owned entities Related party transactions are moderate as a % of revenue or total assets. The percentage was higher in FY18 due to recovery of IPO related expenses.

Related Party Transactions are moderate

Parameters (Fig in INR Lakhs) FY17 FY18 FY19 FY20 FY21

Related Party Transactions 415 1543 439 722 727 Compensation to KMP 100 113 181 225 203 Transaction as a % of Revenue 46% 152% 15% 52% 62%

Source: Company Reports and Ventura Research

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Quarterly and Annual Performance

Source: Company Reports & Ventura Research

Fig in INR Cr (unless specified) Q1FY20 Q2FY20 Q3FY20 Q4FY20 FY20 Q1FY21 Q2FY21 Q3FY21 Q4FY21 FY21 Q1FY22 Q2FY22 FY22E FY23E FY24ERevenue from operations 329.1 385.9 358.8 312.7 1,393.8 194.5 325.2 334.3 307.5 1,171.1 278.2 367.3 1,343.6 1,722.6 1,966.1YoY Growth (%) 19.1 (40.9) (15.7) (6.8) (1.7) (16.0) 43.1 13.0 14.7 27.0 13.5Raw Material Cost 233.4 271.8 258.9 230.6 994.7 140.5 229.0 244.8 228.7 843.1 212.5 266.3 992.0 1,242.2 1,394.4RM Cost to Sales (%) 70.9 70.4 72.2 73.7 71.4 72.3 70.4 73.2 74.4 72.0 76.4 72.5 73.8 72.1 70.9Employee Cost 12.9 14.9 15.6 14.4 57.7 11.9 13.9 14.2 13.3 53.3 10.4 15.4 62.4 74.8 82.3Employee Cost to Sales (%) 3.9 3.8 4.3 4.6 4.1 6.1 4.3 4.2 4.3 4.6 3.7 4.2 4.6 4.3 4.2Other Expenses 55.6 68.0 62.7 54.0 247.7 33.8 58.9 57.8 51.6 211.6 44.2 61.3 215.5 273.0 309.9Other Expenses to Sales (%) 16.9 17.6 17.5 17.3 17.8 17.4 18.1 17.3 16.8 18.1 15.9 16.7 16.0 15.8 15.8EBITDA 27.2 31.2 21.6 13.7 93.7 8.2 23.4 17.6 13.9 63.1 11.1 24.2 73.7 132.5 179.5EBITDA Margin (%) 8.3 8.1 6.0 4.4 6.7 4.2 7.2 5.3 4.5 5.4 4.0 6.6 5.5 7.7 9.1Depreciation 15.3 15.8 15.3 15.4 61.7 16.0 12.7 12.8 13.1 54.6 13.1 13.5 55.2 59.8 63.6Depreciation to Sales (%) 4.6 4.1 4.3 4.9 4.4 8.2 3.9 3.8 4.3 4.7 4.7 3.7 4.1 3.5 3.2Interest Cost 2.1 2.1 1.8 1.6 7.5 1.7 1.6 1.5 1.5 6.3 1.6 1.5 5.7 6.1 6.5Interest Cost to Sales (%) 0.6 0.5 0.5 0.5 0.5 0.9 0.5 0.4 0.5 0.5 0.6 0.4 0.4 0.4 0.3Net Profit 9.7 12.0 5.5 19.8 46.9 (6.0) 8.5 4.6 7.1 14.2 (1.6) 14.7 14.7 55.7 91.3Net Margin (%) 2.9 3.1 1.5 6.3 3.4 (3.1) 2.6 1.4 2.3 1.2 (0.6) 4.0 1.1 3.2 4.6

Adjusted EPS 4.1 5.1 2.3 8.4 20.0 (2.5) 3.6 1.9 3.0 6.0 (0.7) 6.3 6.3 23.7 38.9P/E (X) 41.9 139.0 134.0 35.4 21.6Adjusted BVPS 259.2 265.7 271.6 294.2 331.2P/BV (X) 3.2 3.2 3.1 2.9 2.5Enterprise Value 1,987.5 1,994.8 1,985.0 1,961.1 1,876.6EV/EBITDA (X) 21.2 31.6 26.9 14.8 10.5

Net Worth 608.0 623.1 637.1 689.9 776.6Return on Equity (%) 7.7 2.3 2.3 8.1 11.8Capital Employed 681.3 680.4 698.3 755.2 845.9Return on Capital Employed (%) 6.5 1.6 2.1 7.5 10.7Invested Capital 627.5 650.0 654.1 683.2 685.3Return on Invested Capital (%) 5.1 1.3 2.8 10.6 16.9

Cash Flow from Operations 75.1 77.4 64.3 93.7 146.5Cash Flow from Investing (49.3) (77.8) (50.7) (66.8) (54.7)Cash Flow from Financing (28.0) (14.3) (2.4) (4.9) (7.0)Net Cash Flow (2.2) (14.7) 11.1 22.0 84.9Free Cash Flow 35.4 45.4 15.9 40.4 96.3FCF to Revenue (%) 2.5 3.9 1.2 2.3 4.9FCF to EBITDA (%) 37.8 72.0 21.5 30.5 53.6FCF to Net Profit (%) 75.4 320.7 108.0 72.5 105.5FCF to Net Worth (%) 5.8 7.3 2.5 5.9 12.4

Total Debt 73.3 57.2 61.2 65.2 69.2Net Debt 19.5 26.8 17.0 (6.8) (91.3)Net Debt to Equity (X) 0.0 0.0 0.0 (0.0) (0.1)Net Debt to EBITDA (X) 0.2 0.4 0.2 (0.1) (0.5)Interest Coverage Ratio (X) 4.3 1.4 3.2 12.0 17.9

29 | P a g e ( 6 t h J a n 2 0 2 2 )

Financial Analysis & Projections

Source: Company Reports & Ventura Research

Fig in INR Cr (unless specified) FY20 FY21 FY22E FY23E FY24E Fig in INR Cr (unless specified) FY20 FY21 FY22E FY23E FY24EIncome Statement 1,393.8 1,171.1 1,343.6 1,706.3 1,936.7 Per share data & YieldsRevenue 1,393.8 1,171.1 1,343.6 1,722.6 1,966.1 Adjusted EPS (INR) 20.0 6.0 6.3 23.7 38.9YoY Growth (%) 19.1 (16.0) 14.7 28.2 14.1 Adjusted Cash EPS (INR) 46.3 29.3 29.8 49.2 66.1Raw Material Cost 994.7 843.1 992.0 1,242.2 1,394.4 Adjusted BVPS (INR) 259.2 265.7 271.6 294.2 331.2RM Cost to Sales (%) 71.4 72.0 73.8 72.8 72.0 Adjusted CFO per share (INR) 32.0 33.0 27.4 39.9 62.5Employee Cost 57.7 53.3 62.4 74.8 82.3 CFO Yield (%) 3.8 3.9 3.3 4.8 7.4Employee Cost to Sales (%) 4.1 4.6 4.6 4.4 4.3 Adjusted FCF per share (INR) 15.1 19.4 6.8 17.2 41.0Other Expenses 247.7 211.6 215.5 273.0 309.9 FCF Yield (%) 1.8 2.3 0.8 2.1 4.9Other Exp to Sales (%) 17.8 18.1 16.0 16.0 16.0EBITDA 93.7 63.1 73.7 132.5 179.5 Solvency Ratio (X)Margin (%) 6.7 5.4 5.5 7.7 9.1 Total Debt to Equity 0.1 0.1 0.1 0.1 0.1YoY Growth (%) 12.6 (32.7) 16.8 79.9 35.4 Net Debt to Equity 0.0 0.0 0.0 (0.0) (0.1)Depreciation & Amortization 61.7 54.6 55.2 59.8 63.6 Net Debt to EBITDA 0.2 0.4 0.2 (0.1) (0.5)EBIT 31.9 8.5 18.4 72.7 115.8Margin (%) 2.3 0.7 1.4 4.2 5.9 Return Ratios (%)YoY Growth (%) (29.9) (73.4) 116.6 295.1 59.2 Return on Equity 7.7 2.3 2.3 8.1 11.8Other Income 9.2 8.8 6.1 4.7 7.6 Return on Capital Employed 6.5 1.6 2.1 7.5 10.7Finance Cost 7.5 6.3 5.7 6.1 6.5 Return on Invested Capital 5.1 1.3 2.8 10.6 16.9Interest Coverage (X) 4.3 1.4 3.2 12.0 17.9Exceptional Item 0.0 0.0 0.0 0.0 0.0 Working Capital RatiosPBT 33.7 11.1 18.8 71.4 117.0 Payable Days (Nos) 23 29 29 29 29Margin (%) 2.4 0.9 1.4 4.1 6.0 Inventory Days (Nos) 35 41 40 39 38YoY Growth (%) (39.5) (67.1) 70.1 278.9 64.0 Receivable Days (Nos) 9 8 8 8 8Tax Expense (13.2) (3.1) 4.1 15.7 25.7 Net Working Capital Days (Nos) 20 20 19 18 17Tax Rate (%) (39.3) (27.9) 22.0 22.0 22.0 Net Working Capital to Sales (%) 5.6 5.5 5.2 5.0 4.7PAT 46.9 14.2 14.7 55.7 91.3Margin (%) 3.4 1.2 1.1 3.2 4.6 Valuation (X)YoY Growth (%) 5.1 (69.8) 3.7 278.9 64.0 P/E 41.9 139.0 134.0 35.4 21.6Min Int/Sh of Assoc 0.0 0.0 0.0 0.0 0.0 P/BV 3.2 3.2 3.1 2.9 2.5Net Profit 46.9 14.2 14.7 55.7 91.3 EV/EBITDA 21.2 31.6 26.9 14.8 10.5Margin (%) 3.4 1.2 1.1 3.2 4.6 EV/Sales 1.4 1.7 1.5 1.1 1.0YoY Growth (%) 5.1 (69.8) 3.7 278.9 64.0

Cash Flow StatementBalance Sheet PBT 33.7 11.1 18.8 71.4 117.0Share Capital 11.7 11.7 11.7 11.7 11.7 Adjustments 41.0 50.5 55.3 53.2 62.0Total Reserves 596.3 611.4 625.3 678.2 764.9 Change in Working Capital (12.8) 12.7 (5.8) (15.1) (6.7)Shareholders Fund 608.0 623.1 637.1 689.9 776.6 Less: Tax Paid 13.2 3.1 (4.1) (15.7) (25.7)Financial Liabilities 126.7 69.7 76.9 89.9 98.9 Cash Flow from Operations 75.1 77.4 64.3 93.7 146.5Deferred Tax Assets / Liabilities 40.0 33.1 33.1 33.1 33.1 Net Capital Expenditure (58.0) (32.8) (48.0) (61.0) (51.0)Other Long Term Liabilities 23.0 20.3 23.3 29.5 33.5 Change in Investments 8.7 (45.0) (2.7) (5.8) (3.7)Long Term Trade Payables 0.0 0.0 0.0 0.0 0.0 Cash Flow from Investing (49.3) (77.8) (50.7) (66.8) (54.7)Long Term Provisions 3.9 4.5 5.3 6.3 7.0 Change in Borrowings (17.7) (5.6) 4.0 4.0 4.0Total Liabilities 801.6 750.6 775.6 848.8 949.1 Less: Finance Cost (7.5) (6.3) (5.7) (6.1) (6.5)Net Block 587.9 558.0 550.8 552.0 539.3 Proceeds from Equity 0.0 0.0 0.0 0.0 0.0Capital Work in Progress 19.6 20.9 20.9 20.9 20.9 Buyback of Shares 0.0 0.0 0.0 0.0 0.0Intangible assets under development 0.0 0.0 0.0 0.0 0.0 Dividend Paid (2.8) (2.4) (0.7) (2.8) (4.6)Non Current Investments 0.0 0.0 0.0 0.0 0.0 Cash flow from Financing (28.0) (14.3) (2.4) (4.9) (7.0)Long Term Loans & Advances 29.5 28.2 32.3 41.1 46.6 Net Cash Flow (2.2) (14.7) 11.1 22.0 84.9Other Non Current Assets 41.8 39.4 45.2 57.4 65.2 Cash on Acquisition 0.0 0.0 0.0 0.0 0.0Net Current Assets 122.8 104.2 126.4 177.5 277.2 Opening Balance of Cash 28.7 26.5 11.8 22.9 44.9Total Assets 801.6 750.6 775.6 848.8 949.1 Closing Balance of Cash 26.5 11.8 22.9 44.9 129.8

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