Presentation at ICICI Securities' - "India Unlimited" Second Annual Investor Conference

I CI CI - Securities Annual I nvestor Conference, New York September, 2003 September, 2003
Presentation at ICICI Securities - India Unlimited

Presentation at ICICI Securities - India Unlimited
Second Annual Investor Conference
Second Annual Investor Conference
New York, September 8-10, 2003
New York, September 8-10, 2003
FH03 Performance Highlights FH03 Performance Highlights
Strategy Strategy
Contents
Contents
Economy Economy
Overview Overview
2003 and beyond... 2003 and beyond...
FH03 Performance Highlights
Strategy
Strategy Strategy
Contents
Contents
Economy Economy
Overview
Overview Overview
2003 and beyond...
Economic Outlook
Economic Outlook
2001-02 2002-03 2003-04 (E)*
Agriculture 5.7 (3.2) 7.5
Industry 3.3 6.0 5.0
Services 6.8 7.1 7.5
GDP 5.6 4.3 6.5
Fourth Largest economy in PPP terms
GDP growth second only to China among Asian Economies
Strong Revival expected in Agricultural growth
Resurgence of manufacturing sector
Strong performance of services sector
Growth%
* CMIE Estimates
Indian Economy - Snapshot
Indian Economy - Snapshot
Positives
Favorable monsoons
Healthy GDP growth at 6.5% estimated for 2003-04 (CMIE estimates)
Revival of industrial growth to 6% in 2002-03
Strong forex reserves at 81 bn $
Current account surplus at 2.8 bn $ (Apr - Dec 02)
Upturn noticed in broadbased demand conditions
(Non food credit expected to rise by 16.0% in 2003-04)
Robust growth of 17.8% in exports in 2002-2003
Low inflation 3-4%
Rapid development of infrastructure
Concern
Fiscal defict at 9.3% in 2002-03 and expected to rise in 2003-04
Lag effect of poor agri-output in 2002-03
Total foodgrains production drop of 13.9% in 2002-03
Strategy
Strategy Strategy
Contents
Contents
Economy
Economy Economy
Overview Overview
2003 and beyond...
Our purpose is to meet the
everyday needs of people everywhere -
to anticipate the aspirations of our
customers and consumers and to
respond creatively and competitively
with branded products and services
which raises the quality of life
Hindustan Lever
Corporate Purpose
Hindustan Lever
Corporate Purpose
Hindustan Lever
. Indias largest & leading FMCG company
Hindustan Lever
. Indias largest & leading FMCG company
Turnover 100 2193
EBITDA (Operational) 21 461
Net Profit (bei) 17 373
EPS 7.98 (Rs) 18c
Economic Value Added 12 263
Market Capitalisation 412 9035
* Figures based on FY2002 Audited Results
Personal
Products
21%
Beverages
12%
Foods
7%
Ice Creams
1%
Exports
12%
Others
3%
Soaps &
Dets
43%
* Based on FY2002 segmental revenues
US $ Mn Rs Bln
Source: Mkt Capitalisation at BSE ( 4th September 2003 )
Market Capitalisation
Market Capitalisation
ONGC Reliance Indian Oil HLL Infosys
Market Cap (US $Bln) 20.3 12.6 9.7 9.0 6.1
% of Total Market 10.3 6.4 4.9 4.6 3.1
% Wt in Sensex 15.0 9.0 9.7
% Wt in Nifty 12.4 8.9 6.0
20.3
12.6
9.7
9.0
6.1
0.0
5.0
10.0
15.0
20.0
25.0
ONGC Reliance I ndian Oil HLL I nfosys
Hindustan Lever
...on the Indian Bourses
Hindustan Lever
...on the Indian Bourses
(
U
S

$
B
l
n
)
58.9
39.8
59.5
55.4
33.7
63.5
54.7
64.1
30.7
49.8
33.9
74.9
27.6
8.3
14.8
0
10
20
30
40
50
60
70
80
90
100
P
e
r
s
o
n
a
l

W
a
s
h
F
a
b
r
i
c

W
a
s
h
D
i
s
h
w
a
s
h
S
k
i
n

T
o
o
t
h
p
a
s
t
e
T
a
l
c
u
m

P
o
w
d
e
r
H
a
i
r

W
a
s
h
D
e
o
d
r
a
n
t
s
P
a
c
k
e
t

T
e
a
R
&
G

C
o
f
f
e
e
I
n
s
t
a
n
t

C
o
f
f
e
e
J
a
m
s
K
e
t
c
h
u
p
s
B
r
a
n
d
e
d

A
t
t
a
B
r
a
n
d
e
d

S
a
l
t
Market Leader Strong No. 2
Hindustan Lever
.dominant player across FMCG categories
Hindustan Lever
.dominant player across FMCG categories
M
a
r
k
e
t

S
h
a
r
e

%
Source: : AC Neilson ORG Retail Audit
FMCG
...Opportunities in India
FMCG
Category
Market Size
(US $Mn)
HLL -
Market
Share (%)
Urban
Penetration
(%)
Rural
Penetration
(%)
Total
Penetration
(%)
Fabric Wash 1210 39.8 89.6 82.9 84.9
Personal Wash 938 58.9 97.9 90.7 92.8
Packet Tea 635 30.7 91.2 82.2 84.9
Toothpaste 409 33.7 69.8 32.3 43.5
Skin 312 55.4 36.6 19.8 24.7
Hair Wash 230 54.7 40.1 16.3 23.3
Talcum Powder 148 63.5 66 36.8 45.1
Branded Atta 107 8.3 44 30.2 34.3
Dishwash 102 59.5 54.6 11.5 24.4
Instant Coffee 55 33.9 N.A. N.A. N.A.
R&G Coffee 30 49.8 N.A. N.A. N.A.
Ketchups 25 27.6 12.5 0.7 4.2
Deodrants 19 64.1 N.A. N.A. N.A.
J ams 13 74.9 N.A. N.A. N.A.
Source: Indian Readership Survey2002
Significant scope for growth
Clearly differentiated strategies for :
- High penetration categories > 50%: Drive upgradation / consumption
- Low penetration categories : Drive penetration
13.9
9.0
4.7
2.6
0
2
4
6
8
10
12
14
16
18
20
22
UK Brazil Thailand India
1.31
1.46
0.87
0.50
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
FABRIC WASH
Per Capita ( Kgs )
PERSONAL WASH
Per Capita ( Kgs)
0.23
0.61
0.40
0.07
0.0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
0.40
0.72
0.38
0.04
0.0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
TOOTHPASTE
Per Capita (Kgs )
SHAMPOO
Per Capita ( Kgs)
FMCG
FMCG
50.0
19.0
20.0
11.0
Water Soap Naturals Shampoo
HLL Share of
Shampoos
60%
Share of Hair wash occasions
HLL Share of
Hair Wash
7%
Redefine potential for growth
FMCG
FMCG
Strategy Strategy
Contents
Contents
Economy
Economy Economy
Overview
Overview Overview
2003 and beyond...
Recap
Recap
HPC
Sustained Profitable Growth
FOODS
Improved Profitability
DOMESTIC FMCG
EXPORTS
Focus on core , value add
OTHERS
Divest / discontinue
NON FMCG
STRATEGIC FOCUS
Focus resources on 30 Power brands
Power brands selected to occupy all
relevant consumer appeal & price
segments
Marketing spend, level of innovation
supported by consumer insight & new
technology platforms
Grow Power Brands by
consumer relevant innovation
cross category extensions
leveraging channel opportunities
Strategic Focus
Power Brands
Strategic Focus
Power Brands
Greater rigour
Focused advertising and promotion spend
Reduction in brand cannibalization
Efficient supply chain
Effective market activation
more
more more
is is is is
is is is is is is is is
less
less less
30 30
Power Power
Brands Brands
10 10
Regional Regional
Jewels Jewels
63 Brands 63 Brands
110 Variants 110 Variants
HPC
...Power Brands Drive Growth
HPC
...Power Brands Drive Growth
-1.8
5.3
4.9
5.6
3.5
-4.0
4.1
6.3
8.2
4.6
6.1
6.1
-6.0
-4.0
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
MQ 02 J Q 02 SQ 02 DQ 02 MQ 03 J Q'03
HPC- HLL Sales Growth
HPC- Power Brands Growth
Growth %
FAL : 16%
Lifebuoy : 33% Ponds : 22%
HPC Power Brands
...Delivering strong growth - FH03
HPC Power Brands
...Delivering strong growth - FH03
* Group Basis
Nihar : 11%
Lakme : 53%
Pepsodent : 15% Sunsilk : 6% Lux : 7%
(7.5)
(9.8)
4.3
(10.0)
(5.0)
-
5.0
10.0
FH02 SH02 FH03
(16.1)
(11.6)
17.6
(15.0)
(10.0)
(5.0)
-
5.0
10.0
15.0
20.0
25.0
FH02 SH02 FH03
Strong growth in Foods Power Brands
...Strategy shows results
Strong growth in Foods Power Brands
...Strategy shows results
Power Brands Beverages Power Brands Beverages
(20.0)
Power Brand Processed Foods Power Brand Processed Foods
Power Brand Total Foods Power Brand Total Foods
* Processed Foods and Total Foods exclude Edible Oils and Fats business
(11.0)
(11.3)
4.7
(15.0)
(10.0)
(5.0)
-
5.0
FH02 SH02 FH03
* Group Basis
Annapurna : 26%
Bru : 17%
Taaza : 11%
Foods Power Brands
Delivering strong growth - FH03
Foods Power Brands
Delivering strong growth - FH03
3 Roses : 10%
Kissan : 11%
Foods business to be fit for growth & scale
Reasonable scales of operations achieved
Focus now on improving profitability
Portfolio rationalization
Value added innovation
Re-engineering the supply chain
Improve margins on traditional portfolios -Tea,
Oils
Stop value destruction in Ice Creams - newstrategy
formulated
Focus on premiumproducts in 6 citadel cities
Turnaround Modern Foods
Aggressive investments in brand building &
developing new categories
700
-550
700
1,170
555
Overall HLL
Foods excl
ODF
Processed
Foods excl
ODF
ODF Beverages Ice Creams
Bps changein Gross Margins in 2002
strategy delivers step change
in margin profile
Strategic Focus
Foods : Underlying Profitability
Strategic Focus
Foods : Underlying Profitability
Strategic Focus
Non FMCG Businesses
Strategic Focus
Non FMCG Businesses
Exports
Discontinue non value-adding exports
Focus on core categories - position as Preferred Competitive Source
Non Core : Build only on Country / Company strengths; exit others
Other Non FMCG Businesses
Opening up of the economy & access to world class technology
Need to focus on core businesses
Variety of options actively reviewed - best solution for each business
Seek players with global expertise who are able to support future growth
Strategic Focus
Core - Value added Exports
Strategic Focus
Core - Value added Exports
Growth %
Core Value added portfolio drives growth
Continuing Exports Continuing Exports
-28.3
4.6
5.3
-30.0
-25.0
-20.0
-15.0
-10.0
-5.0
0.0
5.0
10.0
15.0
FY 02
MQ 03 J Q 03
Exports Exports
1.0
15.2
7.7
0.0
5.0
10.0
15.0
FY 02 MQ 03 J Q 03
Non
FMCG
busine
ss
AFS
Quest
Nickel Catalyst
Adhesives
Seeds
Diversey Lever
DIVESTED
TRANSFER
Leather
Mushrooms
Transferred to subsidiaries
for potential JV / disposal
Strategic Focus
Securing the future of Non FMCG
Strategic Focus
Securing the future of Non FMCG
Effective execution of strategy
Effective execution of strategy
HPC
Sustained Profitable Growth
FOODS
Improved Profitability
DOMESTIC FMCG
EXPORTS
Focus on core , value add
OTHERS
Divest / discontinue
NON FMCG
STRATEGIC FOCUS
HPC records all round performance - profitable growth
Step change in profitability of Foods business - Fit for Growth
Ice Creamstrategy halves losses
Exports portfolio rationalised - core exports do well
Significant progress on divestment of non-core businesses
Strategy
Strategy Strategy
Contents
Contents
Economy
Economy Economy
Overview
Overview Overview
2003 and beyond...
Source: : AC Neilson ORG Retail Audit
Growth % 2000 2001 2002 FH - 2003
Personal Wash 6.1 -9.9 -6.1 -1.6
Fabric Wash 5.7 -2.9 -2.1 -4.6
Dishwash 19.2 11.1 -1.8 -2.9
Toothpaste 10 2 -5.5 -11.8
Shampoo 12.5 10.7 7.8 -5.2
Skin Products 12.9 2.6 0.6 4.3
Packaged Tea 0.3 2.4 -9.7 -14.1
HPC 7.6 -2.3 -3.1 -3.3
FMCG 6.7 -1.5 -3.5 -2.8
Market Growth
Market Growth
... key categories decline in 2002, depressed trend continues in FH03
FH 2003 Results
Highlights
FH 2003 Results
Highlights
Overall sales grows by 2.2%, Continuing businesses grow by 3.2%
HPC FMCG grows by 4.5% with power brands growing by 6.2%
Good improvement in foods sales performance
Sales impacted by
Uncertainty in VAT implementation
Truckers strike
Operating profit improves by 9%, margins up 114 bps
PAT (bei) improves by 10.5%
FMCG Sales
Growth Momentum Picks up
FMCG Sales
Growth Momentum Picks up
-3.9
2.6
-0.9
1.4
2.1
-0.2
-4.0
1.0
MQ 02 JQ 02 SQ 02 DQ 02 MQ 03 JQ 03
FMCG Sales
Growth %
HPC Performance
HPC Performance
1.9
4.5
5.5
Total HPC
...accounts for 65% of revenue & 85% of profits
FH 2002
SH 2002
Growth %
-5.5
-1.3
-3.3
1.4
5.4
4.6
1.3
5.3
6.2
-6
-4
-2
0
2
4
6
8
HPC MARKET HLL GROUP HPC GROUP POWER BRANDS
HPC sustains growth momentum HPC Category and Power
Brands beat the market
* Market growth rates as per ORG NewPanel
FH 2002
SH 2002
FH 2003
FH 2003
Soaps & Detergents
Performance Highlights
Soaps & Detergents
Innovation led growth in Personal wash
Strong growth inspite of truckers strike
Growth momentum in Lux and Lifebuoy sustained
Slew of launches/relaunches in the category
Laundry Market impacted adversely with continued downtrading.
Pressure on the mid price and premium segments of the portfolio
Rin re-formulated and launched with patented Nil Mineral Bartechnology
Surf Excel prices reduced and brand relaunched in JQ03; volumes surge
Dishwash grows by 8.3% in JQ03 in a declining market (-)2.7%
Vim Polycoat launched
Personal Wash
...Innovation led growth
Personal Wash
...Innovation led growth
1.4
-4.3
11.1
11.3
8.8
8.1
0.3
-2.3
-7.7
-12.9
13.1
-3.1
-15
-10
-5
0
5
10
15
MQ 02 J Q 02 SQ 02 DQ 02 MQ 03 J Q'03
PW Market Growth HLL PW sales Growth
Growth %
Lifebuoy
...Excellent innovation led performance
Strong double digit growth for 5 consecutive quarters
>30 % growth for 4 consecutive quarters.
-3.7
26.6
35.4 35.6
36.3
31.3
16.8
15.8
15.5
16.8
16.7
17.6
-10.0
-5.0
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
MQ 02
J Q 02 SQ 02 DQ 02 MQ 03 J Q 03
14.5
15
15.5
16
16.5
17
17.5
18
Lifebuoy Growth Lifebuoy Market Shares
Soaps and Detergents
Recent Innovations
Soaps and Detergents
Recent Innovations
Personal Products
Personal Products
Growth sustained in JQ03
Growth led by Skin, Talc, Hair Oil and Shampoos
Strong double digit growth in Skin for 5 consecutive quarters
FAL, Lakme and Ponds show high growths
Oral performance better than market decline
Value proposition redefined
New SKUs launched at convenient price points
Share gain from low price competition
Shampoo sales growth driven by volume growth
Market Value decline continues
Sunsilk registers strong growth of 8% in JQ03
New SKUs launched at convenient price points in MQ03
Value proposition redefined
Hair oils deliver double digit growth for 3 consecutive quarters
PP shows strong growth for the
second consecutive quarter ...
PP shows strong growth for the
second consecutive quarter ...
MQ03 growth sustained
1 11 1. .. .1 11 1
15 15 15 15. .. .9 99 9
8 88 8. .. .1 11 1
0 00 0. .. .0 00 0
5 55 5. .. .0 00 0
10 10 10 10. .. .0 00 0
15 15 15 15. .. .0 00 0
20 20 20 20. .. .0 00 0
FY FY FY FY 02 02 02 02 MQ MQ MQ MQ 03 03 03 03 J Q J Q J Q J Q 03 03 03 03
Personal Products
Growth %
Skin-Consistently beating the market
...Backed by volume growth
Skin-Consistently beating the market
...Backed by volume growth
Strong growth for six consecutive quarters
Double digit growth for 5 consecutive quarters
4.9
3.5
48.6
21.8
24.0
14.3
-5.7
-1.3
2.2
9.1
7.7
19.0
-10.0
0.0
10.0
20.0
30.0
40.0
50.0
60.0
MQ 02 J Q 02 SQ 02 DQ 02 MQ 03 J Q'03
Skin Market Growth HLL Skin Sales Growth
Growth %
Skin Power Brands
Surge ahead..
18 18 18 18. .. .6 66 6
26 26 26 26. .. .1 11 1
8 88 8. .. .8 88 8
0 00 0. .. .0 00 0
5 55 5. .. .0 00 0
10 10 10 10. .. .0 00 0
15 15 15 15. .. .0 00 0
20 20 20 20. .. .0 00 0
25 25 25 25. .. .0 00 0
30 30 30 30. .. .0 00 0
FAIR & LOVELY FAIR & LOVELY
0 00 0. .. .1 11 1
53 53 53 53. .. .3 33 3 53 53 53 53. .. .1 11 1
0 00 0. .. .0 00 0
10 10 10 10. .. .0 00 0
20 20 20 20. .. .0 00 0
30 30 30 30. .. .0 00 0
40 40 40 40. .. .0 00 0
50 50 50 50. .. .0 00 0
LAKME LAKME
1 11 1. .. .0 00 0
21 21 21 21. .. .1 11 1
23 23 23 23. .. .0 00 0
0 00 0. .. .0 00 0
5 55 5. .. .0 00 0
10 10 10 10. .. .0 00 0
15 15 15 15. .. .0 00 0
20 20 20 20. .. .0 00 0
25 25 25 25. .. .0 00 0
PONDS PONDS
Growth %
Personal Products
Recent Innovations
Personal Products
Recent Innovations
Beverages
Core Portfolio Strengthened
Beverages
Core Portfolio Strengthened
Tea impacted by weak commodity prices & low cost loose tea players
Topline decline restricted to (-)2.7% and flat UVG in JQ03
Good improvement in beverages sales performance
Power Brands 3 Roses, Red Label and Taaza grow well
Master Brand BROOKE BONDlaunched
Bru delivers strong growth for 6 consecutive quarters
Leveraging new opportunities
OOH channel
Lipton Ice Tea Business
Beverages
...Power Brands deliver growth
- -- - 12 12 12 12. .. .8 88 8
- -- - 8 88 8. .. .7 77 7
5 55 5. .. .4 44 4
- -- - 15 15 15 15. .. .0 00 0
- -- - 10 10 10 10. .. .0 00 0
- -- - 5 55 5. .. .0 00 0
0 00 0. .. .0 00 0
5 55 5. .. .0 00 0
RED LABEL RED LABEL
- -- - 15 15 15 15. .. .6 66 6
10 10 10 10. .. .5 55 5
12 12 12 12. .. .3 33 3
- -- - 15 15 15 15. .. .0 00 0
- -- - 10 10 10 10. .. .0 00 0
- -- - 5 55 5. .. .0 00 0
0 00 0. .. .0 00 0
5 55 5. .. .0 00 0
10 10 10 10. .. .0 00 0
15 15 15 15. .. .0 00 0
TAAZA TAAZA
- -- - 5 55 5. .. .0 00 0
10 10 10 10. .. .0 00 0
9 99 9. .. .0 00 0
- -- - 5 55 5. .. .0 00 0
0 00 0. .. .0 00 0
5 55 5. .. .0 00 0
10 10 10 10. .. .0 00 0
3 ROSES 3 ROSES
10.7
17.5
15.6
0.0
5.0
10.0
15.0
FY 02 MQ 03 J Q 03
BRU BRU
Growth %
Beverages
Recent Innovations
Beverages
Recent Innovations
Popular Foods shows strong double digit growth in both quarters of 2003
CPD grows by 18.5%in JQ03 backed by strong UVG
Wide assortment of consumer exciting innovations
Processed foods
...On Growth Path
Processed foods
...On Growth Path
Processed Foods
...Continue to grow
Processed Foods
...Continue to grow
Healthy growth trend after profitability improvement
( (( (6 66 6. .. .7 77 7) )) )
7 77 7. .. .0 00 0
20 20 20 20. .. .7 77 7
( (( (10 10 10 10. .. .0 00 0) )) )
( (( (5 55 5. .. .0 00 0) )) )
- -- -
5 55 5. .. .0 00 0
10 10 10 10. .. .0 00 0
15 15 15 15. .. .0 00 0
20 20 20 20. .. .0 00 0
25 25 25 25. .. .0 00 0
FY FY FY FY' '' '02 02 02 02 MQ MQ MQ MQ' '' '03 03 03 03 J Q J Q J Q J Q' '' '03 03 03 03
Processed Foods Sales Growth
* Processed Foods excludes Edible Oils and Fats business
Growth %
Culinary Products
...Volume growth momentum sustained
7 77 7. .. .6 66 6
- -- - 2 22 2. .. .9 99 9
18 18 18 18. .. .5 55 5
- -- - 15 15 15 15. .. .0 00 0
- -- - 10 10 10 10. .. .0 00 0
- -- - 5 55 5. .. .0 00 0
0 00 0. .. .0 00 0
5 55 5. .. .0 00 0
10 10 10 10. .. .0 00 0
15 15 15 15. .. .0 00 0
20 20 20 20. .. .0 00 0
25 25 25 25. .. .0 00 0
30 30 30 30. .. .0 00 0
CPD Sales CPD Sales
5 55 5. .. .0 00 0
( (( (13 13 13 13. .. .8 88 8) )) )
9 99 9. .. .2 22 2
( (( (15 15 15 15. .. .0 00 0) )) )
( (( (10 10 10 10. .. .0 00 0) )) )
( (( (5 55 5. .. .0 00 0) )) )
0 00 0. .. .0 00 0
5 55 5. .. .0 00 0
10 10 10 10. .. .0 00 0
CPD UVG CPD UVG
Growth %
Popular Foods
...Strong Growths in 2003 backed by UVG
- -- - 16 16 16 16. .. .9 99 9
17 17 17 17. .. .7 77 7
23 23 23 23. .. .2 22 2
- -- - 25 25 25 25. .. .0 00 0
- -- - 20 20 20 20. .. .0 00 0
- -- - 15 15 15 15. .. .0 00 0
- -- - 10 10 10 10. .. .0 00 0
- -- - 5 55 5. .. .0 00 0
0 00 0. .. .0 00 0
5 55 5. .. .0 00 0
10 10 10 10. .. .0 00 0
15 15 15 15. .. .0 00 0
20 20 20 20. .. .0 00 0
25 25 25 25. .. .0 00 0
30 30 30 30. .. .0 00 0
Popular Foods Sales Popular Foods Sales
28 28 28 28. .. .3 33 3
22 22 22 22. .. .3 33 3
( (( (25 25 25 25. .. .8 88 8) )) )
( (( (30 30 30 30. .. .0 00 0) )) )
( (( (25 25 25 25. .. .0 00 0) )) )
( (( (20 20 20 20. .. .0 00 0) )) )
( (( (15 15 15 15. .. .0 00 0) )) )
( (( (10 10 10 10. .. .0 00 0) )) )
( (( (5 55 5. .. .0 00 0) )) )
0 00 0. .. .0 00 0
5 55 5. .. .0 00 0
10 10 10 10. .. .0 00 0
15 15 15 15. .. .0 00 0
20 20 20 20. .. .0 00 0
25 25 25 25. .. .0 00 0
30 30 30 30. .. .0 00 0
Popular Foods UVG Popular Foods UVG
Growth %
Processed Foods
Recent Innovations
Processed Foods
Recent Innovations
8
10
12
14
16
18
20
22
1
9
9
6

1
9
9
7

1
9
9
8

1
9
9
9

Q
1
Q
2
Q
3
Q
4
Q
1
Q
2
Q
3
Q
4
Q
1
Q
2
Q
3
Q
4
Q
1
Q
2
2000
2001
2002
Rolling 12-month EBITDA Margins
EBITDA Margin Progression
EBITDA Margin Progression
% Sales
2003
80
120
152
188
237
271
0
50
100
150
200
250
300
1997 1998 1999 2000 2001 2002
* EVA = Net OperatingProfit after Taxes - Cost of capital Employed
US $ Mn
CAGR 27.6 %
Economic Value Added
Economic Value Added
Delighting the shareholder
Delighting the shareholder
Rs
Shareholder receipt in last
6 months (per Re 1 Share)
Final Dividend (2002) 2.659*
InterimDividend (2003) 2.500*
Special Dividend 1.765*
Bonus Debenture 6.000
Total 12.924
* Pursuant to change in dividend tax incidence announced in recent Budget
Dividend Per Share of Re 1 2001 2002 2003
Interim 2.500 2.500 2.867
Final 2.500 3.000
Total
5.000 5.500 2.867
Strategy
Strategy Strategy
Contents
Contents
Economy
Economy Economy
Overview
Overview Overview
2003 & Beyond..
2003 & Beyond..
Growth in current categories
High Penetration Categories - upgradation/consumption
Low Penetration Categories
Greater consumer insight
Technology led innovation
Scale up New Initiatives
New categories, new consumers & new Consumption opportunities
Continued thrust on innovation in Foods
Building a New Exports Horizon
Leverage Channel Opportunities
Ice Cream Vending
Lakme Beauty Salons
Beverages Out of Home
2003 & Beyond..
2003 & Beyond..
Scale up New Initiatives
Lever Ayush
Max Confectionery Sangam E-tailing
Rural Connectivity (Shakti)
2003 & Beyond..
2003 & Beyond..
Lever Ayush
Lever Ayush
Ayush launched in June 02 after rigorous R&D
and extensive clinical testing
5 OTC non prescriptive products introduced
Purity of ayurvedic ingredients endorsed by AVP ,
Coimbatore
Soaps, Oils and Shampoos launched nationally
Roll Ons and Cough Syrup under test
Ayush Therapy Centre started
truth of Ayurveda
proof of Science
truth of Ayurveda
proof of Science
! Max forays into confectionery
! Child centric product development / innovation
! Nationally rolled out post success in Tamilnadu
! Max range of confectionery annualised sale > US $ 10 Mn
Max set to become the largest kids impulse brand
Extending Max to Confectionery
Extending Max to Confectionery
HLL - Network
Aviance relaunched as HLL Network - Jan03
Portfolio widened
Products added:
Lever home range
Male grooming
Reach - 1068 towns
1,15,000 consultants in July03 to grow to 1 Mn by 2007
Sales increases 3 fold
! Leveraging on cost arbitrage opportunities with the West
& Unilever sourcing
! Focus on categories with company / country specific
advantage
! Build sourcing partnerships on the basis of
- World class quality
- Technological / process expertise
- Customer service
- Cost competitiveness
! Exports not at the cost of domestic business
! Sourcing business will improve Exports margin basket
Building a New Exports Horizon
RS-net implementation
- Connectivity with HLL RSs
Benefits
System cost reduction
Secondary Sales Tracking
Robust sales & production planning
Higher ROI for Redistribution Stockist
Field force focus on the HLL Way of Sales
Project Leap
Shared Services
Key Initiatives
A New Paradigm Supply Chain
Key Initiatives
A New Paradigm Supply Chain
...make today
what we
sold yesterday
...make today
what we
sold yesterday
Key Initiatives
Project Shakti
Key Initiatives
Project Shakti
Self Help Groups (SHGs) appointed as Dealers
SHGs distribute goods directly to consumers
Piloted in 2001& extended across several states
Partnerships with several NGOs forged
More than 5000 villages covered touching
7.5 Mn rural lives
40% increase in no of villages covered prior to the project
Key Initiatives
The HLL Way in Sales
Key Initiatives
The HLL Way in Sales
Improved Secondary Sales focus
Differentiated approach to channels
Redefined role of Stockist
Diamond model - new sales organisation
Diamond Model
Different Channels, Different Needs
Diamond Model
Different Channels, Different Needs
Wholesale
Wholesale
Retail Trade
Retail Trade
MT & SST
MT & SST
Mass retail
Mass retail
Key A/c
Retail
Key A/c
Retail
Wholesale
Wholesale
CSD
CSD
Rural
Rural
Go as 'one' Go as 'one'
PC specific PC specific

Concern approach to Concern approach to
derive critical mass derive critical mass
Thank You
Thank You

Presentation at ICICI Securities' - "India Unlimited" Second Annual Investor Conference

Uploaded by

Copyright:

Available Formats

You might also like

Presentation at ICICI Securities' - "India Unlimited" Second Annual Investor Conference

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Presentation at ICICI Securities' - "India Unlimited" Second Annual Investor Conference

Uploaded by

Copyright:

Available Formats

I CI CI - Securities Annual I nvestor Conference, New York September, 2003 September, 2003

Presentation at ICICI Securities - India Unlimited

You might also like