Kaveri Seed

Company Limited
Investor Presentation – February 2018
 Safe Harbour

Certain statements in this document may be forward-looking

statements. Such forward-looking statements are subject to
certain risks and uncertainties like government actions, local
political or economic developments, technological risks, and
many other factors that could cause our actual results to
differ materially from those contemplated by the relevant
forward looking statements. Kaveri Seed Company Limited
will not be in any way responsible for any action taken based
on such statements and undertakes no obligation to publicly
update these forward-looking statements to reflect
subsequent events or circumstances.

2
Contents
Industry Backdrop
& Outlook

Business Overview Quarterly

Performance
5 Years Financial
Performance

3
BUSINESS OVERVIEW

4
 Industry Overview
o The Agriculture sector commands the largest share of the country’s total land area at about 48% (or 156 million hectares)
compared to USA’s 18% (or 158 million hectares) and China’s 15% (or 106 million hectares). While India has more arable land
than China, its production is only half that of China
o The reasons for the lower productivity are low usage of high quality seeds, fertilizers, pesticides, lower farm mechanization,
weak credit facilities, shortage of water and energy
o The organized Indian seed industry has been in existence since 30+ years; however the last decade has witnessed exponential
and transformational growth
o The Indian Seed Industry is the 6th largest in the world in value terms accounting for about 4.5% of global industry preceded by
the US (27%), China (22%), France (6%), Brazil (6%) and Canada (4.8%)
o In volume terms consumption has seen a CAGR of 8.4% from FY09 to FY15 to reach 3.5 million tonnes
o Use of branded seed and hybrid seed has been consistently increasing, Seed Replacement Rate (SRR) on the rise

Corn, 9% Indian Seed Market

Varietal Rice, 13% Europe, 26%
Hybrid Rice, 8% Forecast
Wheat, 5% China, 41%
Global
Vegetable, 16% Crop Soybean, 4% Vegetable 3.01
Segment

USD Bn
Bajara, 3% Seed Market North America,9 % 1.85
Jowar, 2% 0.35 0.70
Latin America, 7% FY15 FY20E
Mustard, 3%
Cotton, 36% Rest of APAC, 10% India, 7%
Sunflower, 1% Vegatable Field

Source: ISF & Sathguru Analysis (Rs/$ Exchange rate: FY15 at 65.42)
5
 Industry Overview

Cotton Seed Paddy Corn (Maize) Vegetables

o High market penetration of o Paddy is the largest crop o Maize is the most widely o Hybrid vegetable seed is one
hybrids under cultivation in India grown crop worldwide of the fastest-growing
o Growth a function of market and is the staple food for o India is the world's 6th segments in India estimated
share gains, High Density large population largest producer and 5th to be around INR 2,000 crore
Planting and Mechanical o Hybrid penetration at less largest consumer of maize o India is the second-largest
Harvesting than 10% o Maize acreage has grown in producer of vegetables in the
o Pricing subject to GOI’s o Farmers used saved seed; India over years as it is world, after China
Price Control Order however branded and highly adaptable to different o Round the year crop,
o KSCL is market leader hybrids gaining increased season, requires less water, safeguarding from crop shift
acceptance easy to grow with good patterns
o Company developed commodity price
hybrids with only the pest o Market for both selection
control trait sourced under variety rice and hybrid rice o Demand for Maize in India
license growing rapidly in expected to continue to
grow due to demand from
feed industry (accounting
for ~50% of domestic maize
demand) and export
opportunity (seen a strong
24% CAGR in FY2005-14)

6
 The Kaveri Moat: Seeding Profitable Growth

Strong P&L record, Cash Leadership in key crops:

rich, consistent dividend Top 5 Rank
paying

Benchmark R&D:
Diverse Product portfolio Comprehensive germplasm
addressing crop rotation & repository
shift
Market adjacent, Pan- India
Operations with
comprehensive distribution
Brand Salience: Preferred Choice for network; unmatched
farmers, growers, distributors processing & storage
capabilities

Farmer-centric Product High Entry Barriers,

Pipeline: Superior Indispensable industry
agronomic features

Best placed to scale-up

Unrivalled farmer loyalty:
production
Nurturing farmer relationships
since decades

7
Company Profile
With consistent performance in all functional areas of the Company,
our endeavour is to make Kaveri a benchmark seed company with the
best of research, innovation and product development.
Our
Vision

To realise our vision, every member at kaveri will adopt

Our consequential values of the Company and inculcate sustainable
business practices. In our endeavour to reach the goal, team Kaveri
Mission would uphold all brand promises to its stakeholders.

We have over three decades of experience in application of the science

of genetics and principles of plant breeding in the evolution of crop
Our hybrids, quality seed production, conditioning and processing and in
building extensive distribution network with strong farmer
Expertise relationship.

We are serving Indian farmer consistently to improve their crop

Our yields ever since inception. We have developed enduring
Reputation relationships with farmers across India; and our ‘Kaveri Seeds’ brand
enjoys wide reputation and loyalty, owing to our product range and
quality commitment.

8
 Board of Directors & Key Management

Mr. G. V. Bhaskar Rao Dr. G. Pawan Mrs. G. Vanaja Devi Mr. C. Vamsheedhar Mr. C. Mithun Chand
Founder promoter, Chairman Vice Chairman - Non Founder Director Executive Director Executive Director
& Managing Director Executive

Mr. M. Srikanth Reddy Dr. S. Raghuvardhan Reddy Dr. P. Vara Prasad Rao Mr. K. Purushotham
Board member Board member Board member Board member

Dr. S. M. IIyas Mr. Satish Patil Mr. G. Vijay Kumar

Board member Chief Operating Officer Chief Financial Officer

9
 Relevant facts

30 + Years 50,000+ acres 214 7 2,900 MT/cycle

Rich experience in Indian Land under seed Number of filings to date State-of-the-art seed Maize cob drying facility
seed industry production across technology, processing
different agro-climatic and storage plants
zones

100 + 30,000 + 94 600,000 sqft

16 MT/day
Developed high-quality Loyal production growers, Product registrations with Cumulative warehouse Environment-friendly
hybrid and varieties across across 12 different agro- PPV to date space at multiple strategic cotton delinting capacity
field crops and vegetables climatic zone location across India

3 rd 15,000 + 16 ~ 130 MT/hour 8 MT/day

Largest producer of hybrid Customer touchpoints Notified hybrids under Total average throughput Ginning capacity
cotton seeds in India across India’s 15 key states CVRC- GoI

750 + 1,000+ 170 + 14,000 MT

Motivated team members Field promoters, who Outreach trial centres Total cold storage capacity
work with farmers all the
time

10
 A 30 year Transformational Journey
Received
Seed recognition from
conditioning the Department of Commissioned
Seed production plant Scientific and seed conditioning Public offer
unit started by Launched launched at Industrial plants at Gundla and listing Launched premier
Shri G. V. Bhaskar Kaveri Seed Initiated R&D first hybrid Kandlakoi, Research for our Pochampally and in stock cotton Hybrid
Rao incorporated programme Maize Telangana R&D initiatives Eluru exchange Jaadoo

1976 1986 1991 1997 2000 2001 2004 2007 2008

2009 2010 2011 2012 2013 2014 2015 2016

Commission Listed Launched Listed among Listed among The Conferred the Kaveri
ed seed among the Kexveg, a new the Forbes the Forbes 'Best Company Bio- Excellence Seeds
conditioning Forbes initiative for ‘Best under a under a Billion' achieved Asia Award by completed
plant at 'Best under premium Billion’ in Asia in Asia Pacific significant the Department 30 years of
Pamulaparth a Billion' in vegetables Pacific benchmark of IT, BT and journey
Listed among
i, Andhra Asia turnover of S&T,
Listed among 'Fastest
Pradesh Pacific over ` 1,100 Government of
the Forbes 'Best Growing
Crores. Won Karnataka. Listed
under a Billion' Companies' by
the ‘Best among the
in Asia Pacific Outlook
CEO’ award Forbes 'Best
Business
by Business under a Billion‘
Today in Asia Pacific

11
Diversified Seed Portfolio

Field Crops Vegetables

Cotton Maize Rice Tomato Okra

Bajra Sunflower Mustard Hot Pepper Watermelon

Sorghum Pulses Wheat Gourd Eggplant

12
Diversified Seed Portfolio
Market oriented & need
focused breeding programs
resulting in highly successful
product portfolio

Wider acceptance of key Access to a wide range of

products in the market place products owning to the well-
leading to significant increase established R&D set-up
in revenues

Capability to produce over 100

High value premium hybrids high quality hybrid seeds
of field and vegetable crops across commercial crops, food
crops and vegetables

High brand recall across

product segments in farming
community

13
 Leadership Product Portfolio

Kaveri’s cotton seed volume break-up

(m packets) FY16 FY17 9M FY18 • Kaveri is amongst the top three seeds
AP & Telangana 3.42 2.92 3.20 companies in the cotton segment, and top five
Maharashtra 1.12 1.49 2.23 in the maize, paddy and pearl millet segments
Karnataka 0.45 0.42 0.68
• Combined, these crops account for more than
Gujarat 0.25 0.24 0.41
90% of revenues of the Indian hybrid seed
Madhya Pradesh 0.16 0.19 0.21
Others 0.18 0.19 0.21
industry
All India 5.59 5.44 6.94

Cotton seed revenue & volumes Hybrid Rice seed revenue & volumes Maize seed revenue & volumes
6.9 10.9
5.6 9.2 9.0
5.4 1.7 1.6 1.7

422 358 464 32 28 33 138 161 132

FY16 FY17 9MFY18 FY16 FY17 9MFY18 FY16 FY17 9MFY18

Net Revenues (Rs cr) Net Revenues (Rs cr) Sales Volume ('000 tons) Net Revenues (Rs cr)

14
 o Significant investments in the last five years for strengthening R&D

o Developed proprietary germplasm and Hybrids

o Over 600 acres of dedicated research farms with varying agro-climatic conditions

– State-of-the-art Biotech, Quality check and seed technology labs

Benchmark R&D – Cold / DH storage for germplasm

o Multi-location breeding and trial stations

o Strong and highly motivated R&D team about 100 personnel, including more than 20
scientists

– Conjunct use of Bio and hybrid technologies in product development

One of the
Largest – Deployment of frontier technologies – Doubled haploid breeding, MAS
Pools Of (Marker Aided Selection), MARS (Marker Assisted Recurrent Selection), RGA
Germplasm (Rapid Generation Advance), Inbred pool-heterotic bins, MPS (Multi-parent
in India synthetics ) and MAGIC (Multi-parent Advanced Generation Inter-cross
populations

o Research and Development facility recognized by Department of Science &

Technology, Government of India
Seed is most
o Partnering with ICRISAT, Melinda Gates Foundation’s Harvest Plus program, IRRI’s
critical to output
Hybrid Rice Development Consortium, CIMMYT and USDA program on Heat
for a farmer:
Tolerant Maize for Asia (HTMA), DBT’s Biotechnology Industry Research Assistance
Performance
Program (BIRAP) and Asian Vegetable Research and Development Center (AVRDC)
ensures premium,
for Vegetables
repurchase
o Collaboration with NARS (National Agricultural Research System) Institutes and All
India coordinated crop improvement programs of ICAR
15
 Supply Chain Management

• Sales Forecast • Foundation Seeds

• Seed Production Planning • Hybrid Seeds • Inbound
• Raw materials
• Packing Material & Chemical

Planning Field Production Logistics

1 2 3

7 6 5 • Drying
• Processing
Seed Markets Logistic Storage
• Packing
• Finished Goods

• Domestic
• Exports • Outbound • Ambient storage – short term
• Finished Goods Delivery • Cold storage – long term

16
 Complete control over all stages of Product Cycle
o A 7-10 year cycle
o Seed production undertaken post comprehensive market trialing
o Practice benchmark production regimen throughout the cycle – Grower/ Breeder to Farmer

Collecting Quality Distributing

Developing Producing
Evaluating Needs Genetic testing & and Selling
New Hybrids Seeds
Resources Packaging Seeds

17
 Distribution Presence

Punjab
Molangoor Gatla Narsingapur Haryana
Delhi

Rajasthan
Bihar
Gowraram Pamulaparthi
2 Plants Jharkhand West
Gujarat Madhya Pradesh Bengal

Gundla Pochampally
Odisha
Maharashtra

Telangana Eluru

Secunderabad
- Presence
Bellary

- Head Office

- Plant

- R&D Laboratory

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 Best-in-class, Market adjacent, Scalable Operations

• Large production area across India with a loyal ‘producer farmer’ network
o 30,000+ loyal production growers across 12 different agro-climatic zones
Strong Brand o 1,000+ field promoters, who work with farmers all the time
Equity in farming o ~ 50,000 acres under seed production across different agro-climatic zones
community • High credibility with the farmers
• Focused programmes to spread awareness amongst farming community on new products in
market

• 7 Company owned plants across key locations in India with a combined processing capacity
Amongst The of ~ 130 tonnes per hour
Largest • Modern equipment for pre-cleaning, grading, cob drying, storage, packing
Processing • Maize cob drying facility with a capacity of 2,900 tonnes per cycle
Capacities • Green houses for screening, uniform blast nursery for disease/pest screening
• Cotton delinting facility

Strong • Warehouses across India with combined storage space of ~600,000 sqft
Warehouse • Dehumidified, climate-controlled storage facilities
• Storage godowns of ~135,000 sqft. (cold) and ~280,000 sqft. (ambient) with holding capacity
Capabilities of ~25,000 MT

• Network of more than 15,000 direct/indirect distributors across the country

Pan India • More than 200 highly motivated marketing professionals on a pan India basis
Presence • Utilize more than 8,000 man-months of Promoters to communicate about farming best
practices to farmers

19
High Entry Barriers: Brand Equity Paramount

• Need for high investments in

R&D for seeds
• Lead time from R&D to
commercial launch is 7-8 years
• Requirement of a wide • Need for high degree of
distribution network across credibility with farmers
India for a diverse portfolio of • Farmers will not jeopardize
seeds considering the varied their years’ worth of income
agro-climatic conditions across and land arability on
India unestablished company seeds
• A complex process of
developing an effective hybrid
(key skills required to choose
the right kind of lines)

20
 Farmer-engagement Programmes
Increased visibility and mindshare Krishi melas: Participate in and sponsor
o Retailer reach and connect increased agricultural fairs at state and district levels
aimed at disseminating knowledge on new
o Focused training of Field Assistants for technologies and better farming techniques
educating farmers on advanced among farmers. These public gatherings are
agronomic practices and product organised in collaboration with the State
knowledge Department of Agriculture, SAU’s and ICAR
o Revenue per employee of Cotton & Field institutions.
Crop Sales increased by more than 25%
YoY in FY17 Other initiatives
o Provide financial assistance to farmers
On-farm technology demonstration when needed
o Conduct farmer education programmes o Our team approaches farmers and
across geographies to make them aware provides time-critical farm assistance
of new and high-yielding products; also
educating them about best-inclass o We have promoters who educate farmers
farming techniques to increase yield and about our products and agronomy
income practice to be followed in specific
geographies
o Strengthens the confidence and trust of
farmers in the Kaveri brand o We engage in several BTL and ATL
branding initiatives for targeted
o Have increased the number of farm audiences
demonstrations for many of our pipeline
products
o Multi Location Trials increased

21
 Seeding Community Wellbeing
As a responsible corporate citizen, we undertake several sustainability initiatives for the well-being of communities.
Our interventions help farmers improve their lives and be a part of India’s socioeconomic progress.
We have adopted three villages (Gatla Narsingapur, Ramnagar and Bollone Pally) in Telangana, where we
conducted the following programmes during the year:

o Constructed new school buildings at Siddipet town and Gatla Narsingapur village in Karimnagar district
o Disbursed salaries of Vidya volunteers of Upper Primary School (UPS) and Zilla Parishad High School (ZPHS)
at Gatla Narsingapur village,
o Built a mineral water plant at Gatla Narsingapur to supply potable water
o Distributed books and school bags among students of several UPS and ZPHS in Bheemdevarpally Mandal,
Karimnagar district, for the academic year 2016-17
o Made furniture for a school at Gatla Narsingapur village and several colleges in Karimnagar district
o Funded school maintenance expenses like electricity charges of school buildings, upkeeping of canteens and
arranged sports and cultural activities at UPS and ZPHS in Gatla Narsingapur village
o Built new roads and improved the existing road and drainage facilities in the three villages
o De-silted a tank at Gatla Narsingapur to ensure better water storage facility
o Provided a school bus to Gatla Narsingapur village to facilitate smooth journey of the village children from
home to school and back
o Installed computers at the Gatla Narsingapur village school for students to learn the nuances of technology
o Donated funds to ‘Swarna Bharath Trust’ for rural development activities
o Constructed a community hall
o Led massive plantation drives in three villages under the ‘Haritha Haram’ programme
o Adopted three schools in three villages to ensure education and empowerment of school-going children
o Provided scholarships to school and college students from socially backward communities, encouraging them
to pursue higher studies

22
5 YEARS FINANCIAL
PERFORMANCE

23
 5 Year Financial Highlights: Standalone
Significant Growth Trajectory and Superior Return Profile

Revenues (mn) EBIDTA (mn) Net Profit (mn) EPS (Rs.) ROE (%) ROCE (%)

3,222

41.1%
40.6%

40.5%
39.8%
43.8
3,018

38.1%
10,010

37.5%
8,188

2,299

30.6
7,282

2,106
7,042

2,025
6,064

25.0
1,723

18.8%
1,444

18.4%
19.0
1,299
1,130

11.4
785

7.7%

8.2%
FY16

FY14
FY13

FY14

FY15

FY16

FY17

FY13

FY14

FY15

FY16

FY17

FY13

FY14

FY15

FY17

FY13

FY14

FY15

FY16

FY17

FY13

FY15

FY16

FY17

FY13

FY14

FY15

FY16

FY17
FY16 & FY17 turned out to be a difficult years for the seed industry, and the farmers
 Cotton Headwinds - Significant drop in volumes and acreage coupled with no price hikes and one of the shortest sales seasons
 Higher sales returns in non-cotton crops

24
 FY13 1,791

FY14 2,031

FY15 2,803

(Mn)
FY16 3,051

Gross Block
FY17 3,406

FY13 1.39

FY14 1.71

FY15 2.38
(times)

FY16 2.71
Current ratio

FY17 2.58

FY13 0.79

FY14 0.76

FY15 0.87
Inventory

FY16 0.73
turnover (times)

FY17 0.78

FY13 3.77

FY14 4.23

FY15 4.11

FY16 2.45
Fixed asset
turnover (times)

FY17 2.08

FY13 29.3
5 Year Financial Highlights: Standalone

FY14 29.6

FY15 29.8

FY16 41.1
Receivable Days

FY17 36.2

FY13 113
Significant Growth Trajectory and Superior Return Profile

FY14 157

FY15 193
25

FY16 355
Non Cash Net
Current Assets
Revenue Days

FY17 410
INDUSTRY BACKDROP &
OUTLOOK

26
 Industry Backdrop

o Seed Industry Sales trend compared to last year o Crop-wise area coverage during Rabi 2017-18: As on
January 19, 2018
– Cotton ++ Area in lakh hectare
– Maize + YoY
Crops 2017 2016
Change %
– Hybrid Rice +
Maize 15.73 15.35 2.48
– Selection Rice ++ Rice 22.32 15.99 39.59
– Bajra ++ Bajra 0.224 0.159 40.88
– Vegetables + Pulses 163.1 155.76 4.71
Oilseeds 79.11 82.07 (3.61)

o Overall rainfall was normal but with wide variation

o Crop-wise area coverage during Kharif 2017: As on
o Dry spell in August impacted yield of crops like maize, September 29, 2017
soybean and other short duration crops
YoY
o Late rains impacted crop in many areas Crops 2017 2016
Change %
o Late withdrawal of monsoon helped moisture build up Cotton 122.6 102.8 19.3
for Rabi season Maize 80.5 84.2 (4.4)
o Tamil Nadu recovered from last year drought Rice 379.1 382.4 (0.9)
Bajra 71.8 70.4 2.0
o Vegetable market has improved compared to H1
Pulses 142.0 147.5 (3.7)
o Commodity prices have remained lucrative for cotton Oilseeds 173.4 190.3 11.7

27
Industry Backdrop – All India Rainfall

Source: IMD
28
Industry Backdrop – All India Rainfall

Source: IMD
29
Industry Backdrop – All India Rainfall

Source: IMD

30
 Industry Backdrop - Maize
Area coverage during Kharif 2017 Area coverage during Rabi 2017-18
as on September 29, 2017 as on January 19, 2018
o Telangana and Karnataka
Area in lakh hectare constitute more than 1/3
of organized market in
YoY YoY Kharif Hybrid Maize seed
State 2017 2016 State 2017 2016 sales
Change % Change %

Madhya Pradesh 13.2 12.6 4.3 Bihar 4.7 4.5 4.0 o Telangana and Karnataka
Rajasthan 9.1 9.3 (2.4) Andhra Pradesh
contributed to nearly 2/3
1.9 1.4 40.4
Karnataka (12.0)
of KSCL’s Kharif maize
11.3 12.8 Maharashtra 1.9 2.7 (29.4) sales in FY17
Maharashtra 9.1 9.2 (0.9) Tamil Nadu 1.7 0.6 170.9
Uttar Pradesh 7.3 7.8 (7.0) West Bengal 1.1 0.7 74.6 o Farmer down traded in
Telangana 4.5 5.9 (22.9) Telangana 1.0 1.2 (14.8) few states due to tough
Bihar 4.1 4.3 (5.3) market conditions
Karnataka 1.0 0.8 18.3
Gujarat 3.1 3.2 (5.2)
Gujarat 1.0 1.3 (24.0) o Karnataka market
Himachal Pradesh 2.9 3.0 (1.0)
Chhattisgarh 0.5 0.4 15.9 recovered in the second
Jharkhand 2.8 2.9 (0.7) half of the season due to
Assam 0.3 0.2 42.8
Orissa 2.3 2.3 0.4 late sowing. However,
Uttar Pradesh 0.12 0.1 14.3
Chhattisgarh 2.3 2.3 0.4 market still lower than last
Jammu and Kashmir 2.0 2.0 (0.5) Orissa 0.1 0.1 37.5 year
Punjab 1.4 1.5 (6.9) Jharkhand 0.1 0.1 7.8
Arunachal Pradesh 0.1 0.1 (2.2) o Productivity impacted due
Andhra Pradesh 1.0 0.8 25.6
to weather fluctuation
Others 3.3 3.3 1.2 Others 0.2 0.2 5.6
Total 80.6 83.9 (4.0) Total 15.7 15.4 2.5 o Rabi exports impacted due
to crop shift to Hybrid Rice
in Bangladesh

Source: Department of Agriculture Cooperation & Farmers Welfare 31

 Outlook

Industry KSCL
o Cotton outlook looks healthy despite Pink bill o Kaveri expects to do well in Cotton
worm issues impacting yield as well as quality; irrespective of flattish industry growth driven
as cotton prices have remained lucrative by market share gains in Maharashtra, AP &
Telangana, Gujarat
o Kharif maize acreage to improve
o Jaadoo, ATM have been performing
o Vegetable sale picked up in Q3, Q4 to be better steadily and recently launched Money
o Major crop shifts not expected in Kharif 2018 Maker has received strong traction

o Rice to grow on the back of KPH 468 and

several products launched and notified
o Maize performance to be driven 2 new Rabi
hybrids and 3 new Kharif hybrids
o Strong Vegetable growth driven by new
hybrids acrosss Hot Pepper, Okra, Tomato and
Gourd

32
 Growth Strategy – Initiatives FY18
Organizational Increased visibility Reinforce cotton
Diversification Supply Chain
Capability and mindshare leadership
Non cotton business stronger - Human Capital Farmer Connect Deliver volumes as per growth Expanding footprint outside of
reducing dependence on cotton o Appointed new COO – o Increased number of plan Telangana/Andhra Pradesh
Satish Patil and new exports demonstration of pre o Cotton planting completed and Karnataka
o Cotton growth has been more commercial products
head – Manish Tyagi in four strategic location as o Significant growth and
than other crops this quarter but
o Appointed new R&D head, o Increased number of below per plan market share gain in Gujarat
the strategy is to grow non cotton the line activities to connect and Maharastra
significantly strengthening o Rabi scale up plan in place
business as well the core team – had with farmers
o Selection Rice volume increased appointed Supply Chain , Increased R&D effort in North
by more than 40% Marketing heads for Field Channel Engagement Establish Vegetable seed New Products
Crop and Vegetable in last production
o Hybrid Rice and Bajra looking o Mapping of retailer and o Money Maker ramp up
two years focus on key retailers o Increased vegetable seed positive
positive with new product production area for catering
contribution going up o Beefed up mid-level talent o Improved engagement with o New product contribution
across verticals to FY19 plan
Channel partners with more up from 7% to 17%
Nurturing Vegetables business o Increased resourcing in meetings Improve efficiency in operations
R&D
o Increased investment in R&D o Improved recovery rates of
o Built exclusive Vegetables selection rice in new
o Demonstration of more than 50 sales team of more than 25
different product in farmer field Mulangoor plant
dedicated employees from
4 same time last year o Leverage Mulangoor plant
Spreading geographical footprint to handle higher thru-put
o Focused on strengthening Processes
Improve seed quality
distribution network beyond o Human Resource
Management System being o Reduced raw seed failure
South and Central India, to compared to last year in
implemented for efficient
northern, eastern and western Maize and Cotton.
management
geographies
o Increased number of multi-
– Bihar >50% growth locational trials in R&D for
– Jharkhand >100% growth product evaluation
– Orissa >50% growth o SAP implemeSnted in Q3
– West Bengal >200% growth
– Gujarat >50% growth Infrastructure
– Maharastra >50% growth o Purchased 24 acre land in
Telangana for R&D and
future expansions
33
QUARTERLY
PERFORMANCE

34
 Q3 FY18 Performance Review
Standalone
Profitability impacted by: Rs. lakhs 9M FY18 9M FY17 Growth (%) Q3FY18 Q3FY17 Growth (%)

Net Sales 73,079.84 62,969.53 16.06 7,063.93 6,792.21 4.00

o Maize volumes impacted by lower
acreages in Telangana and Karnataka; Cost of Production 37,161.15 35,325.87 5.20 3,976.55 3,751.69 5.99
and lower exports, Revenue increased Gross Profit 35,918.69 27,643.66 29.93 3,087.38 3,040.52 1.54
due to high value product mix
Gross Margin (%) 49.15 43.90 43.71 44.76
o Other income lower as a result of Employee cost 3,316.01 2,603.15 27.38 967.31 743.61 30.08
lower redemptions
Other Expenses 9,467.94 8,536.78 10.91 1,146.88 1,956.69 (41.39)
o Cost of production lower as a result of
Other income 2,231.29 3,258.28 (31.52) 162.24 1,009.72 (83.93)
lower write offs
EBITDA 25,366.03 19,762.01 28.36 1,135.43 1,349.94 (15.89)

EBITDA Margin (%) 34.71 31.38 16.07 19.87

Depreciation 1,810.87 2,193.69 (17.45) 574.81 689.31 (16.61)

Finance Cost 35.25 7.95 343.40 4.57 4.23 8.13

PBT 23,519.91 17,560.37 33.94 556.05 656.40 (15.29)

PAT 22,871.73 16,566.59 38.06 543.43 355.25 52.97

PAT Margin (%) 31.30 26.31 7.69 5.23

.
35
Cash investments as on 31 December 2017
Rs.in Lakhs All figures based on cost
Fund Medium
Liquid Liquid Plus FMPs Short Term Total
House Term

ASK - - - - 2,991 2,991

BIRLA - - - 3,215 2,700 5,915

DSP 500 - - - - 500

HDFC - - 4,905 - 3,800 8,705

ICICI 152 670 780 2,750 3,703 8,056

IDFC - 1,286 - - 1,100 2,386

IIFL - - - - 2,500 2,500

KOTAK 1,000 4,000 - - 350 5,350

RELIANCE - 1,253 - - 5,300 6,553

TATA - 297 - - - 297

UTI - - - 500 - 500

Total 1,652 7,506 5,685 6,465 22,444 43,753

Total cash on books of Rs . 458 crore as on 31 December, 2017

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 Q3 & 9M FY18 Operational Highlights
o Cotton Kaveri volumes grew by 28% in 9M o 2 new cotton hybrids launched and 2 new cotton hybrids under
demonstrations with farmers - Performance of Money Maker
– Gained cotton seed market share in Gujarat, Maharastra , Karnataka
appreciated by farmers
o Maize volumes dropped by 14 %YoY in 9M
o 3 new hybrids launched in maize for kharif season. 2 new hybrids
– Market dropped in key Kaveri states of Telangana and Karnataka
in maize to be launched in rabi season
– Government business volumes dropped compared to last year
o 2 new maize hybrids under demonstration
o Hybrid Rice volumes increased by 10% in 9M inspite of drop in govt business
– Introduction of new hybrid helped o 4 new hybrids in pearl millet in kharif season under demonstration.
1 new product launched
– Contribution of new product went up from 1% to 18% of volume
o Selection Rice volumes grew by 30% in 9M o 1 new hybrid launched in hybrid rice and 4 new products launched
in selection rice . KPH 468 13x growth. Consistent performance
– Contribution of new products went up from 3% to 8%
across geography. Plan in place to ramp up in coming year
o Bajra - Volume has dropped but new product contribution is up
o 1 new hybrid in hybrid rice and 2 new products in selection rice
– New product contribution has gone up from 6% to 14% of volume
under demonstration
o Sunflower volume has doubled in 9M FY18 compared to 9M FY17
o Notifications for 2 new rice hybrids and 1 tomato hybrid

Cotton seed revenue & volumes Hybrid Rice seed revenue & volumes Maize seed revenue & volumes
2.0 10.4
6.9 8.7 9.0
1.6 1.7
5.5 5.4

418 349 464 33 30 33 119 148 132

9MFY16 9MFY17 9MFY18 9MFY16 9MFY17 9MFY18 9MFY16 9MFY17 9MFY18

Net Revenues (Rs cr) Sales Volume (mn packets) Net Revenues (Rs cr) Sales Volume ('000 tons) Net Revenues (Rs cr)
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Investor Contacts

For further information, please contact:

Tel: +91 40 4919 2345

G. Vijay Kumar Fax: +91 40 2781 1237
CFO, Kaveri Seeds [email protected]
# 513 B, 5th Floor, Minerva Complex, S.D.Road, Secundrabad -
500 003
www.kaveriseeds.in

Gavin Desa +91 22 6645 1237

CDR India gavin@cdr-india

Vikram Rajput +91 22 6645 1223

CDR India vikramr@cdr-india

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THANK YOU

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