Revised Investor Meet Presentation [Company Update]

8/20/2019 Revised Investor Meet Presentation [Company Update]

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The Great Eastern Shipping Co. Ltd.

1

Business & Financial Review

February 2016


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Except for historical information, the statements made in this presentation

constitute forward looking statements. These include statements regarding the

intent, belief or current expectations of GE Shipping and its management

regarding the Company’s operations, strategic directions, prospects and future

results which in turn involve certain risks and uncertainties.

Certain factors may cause actual results to differ materially from those contained

in the forward looking statements; including changes in freight rates; global

economic and business conditions; effects of competition and technological

developments; changes in laws and regulations; difficulties in achieving cost

savings; currency, fuel price and interest rate fluctuations etc.

The Company assumes no responsibility with regard to publicly amending,

modifying or revising the statements based on any subsequent developments,

information or events that may occur.

2

Forward Looking Statements


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Corporate Profile

The Great Eastern Shipping Company

Shipping (Bulk)

Tankers

- Crude

- Products

Bulk

Offshore

(Through wholly-owned subsidiary

Greatship (India) Limited)

DrillingLogistics

India’s largest private sector shipping company.

Over 67 years of experience

3


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0

10

20

30

40

50

60

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80

90

100

0

2

4

6

8

10

12

14

16

1 9 8 4 - 8 5

1 9 8 5 - 8 6

1 9 8 6 - 8 7

1 9 8 7 - 8 8

1 9 8 8 - 8 9

1 9 8 9 - 9 0

1 9 9 0 - 9 1

1 9 9 1 - 9 2

1 9 9 2 - 9 3

1 9 9 3 - 9 4

1 9 9 4 - 9 5

1 9 9 5 - 9 6

1 9 9 6 - 9 7

1 9 9 7 - 9 8

1 9 9 8 - 9 9

1 9 9 9 - 0 0

2 0 0 0 - 0 1

2 0 0 1 - 0 2

2 0 0 2 - 0 3

2 0 0 3 - 0 4

2 0 0 4 - 0 5

2 0 0 5 - 0 6

2 0 0 6 - 0 7

2 0 0 7 - 0 8

2 0 0 8 - 0 9

2 0 0 9 - 1 0

2 0 1 0 - 1 1

2 0 1 1 - 1 2

2 0 1 2 - 1 3

2 0 1 3 - 1 4

2 0 1 4 - 1 5

Dividend per share (Rs) Dividend Payout Ratio (%) (RHS)

4

Uninterrupted dividend for 30 years

Interim dividend of Rs. 6 per share announced in Q3 2015-16

* Div idend payout calculated basis standalone nos.


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Promoters30%

FII23%

Govt/FI20%

CorporateBodies

6%

Public21%

5

Shareholding Pattern

Shareholding Pattern as on December 31, 2015


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6

Shipping business - owned fleet

Sr. No. Vessel Name Type1 Jag Lalit Suezmax

2 Jag Lok Suezmax

3 Jag Lateef Suezmax

4 Jag Lakshita Suezmax

5 Jag Lyall Aframax

6 Jag Lata Aframax

7 Jag Laxmi Aframax

8 Jag Lavanya Aframax

8 Crude Carriers ; Average Age - 13 years9 Jag Aabha LR1

10 Jag Aanchal LR1

11 Jag Amisha LR1

12 Jag Aparna LR1

13 Jag Pahel MR

14 Jag Pankhi MR

15 Jag Prabha MR

16 Jag Prakash MR 17 Jag Pushpa MR

18 Jag Prerana MR

19 Jag Pranav MR

20 Jag Pranam MR

21 Jag Padma MR

13 Product Carriers; Average Age - 9.5 years

Sr. No. Vessel Name Type22 Jag Vishnu VLGC

1 Gas Carrier; Age - 22 years

23 Jag Aarati Kamsarmax

24 Jag Aditi Kamsarmax

25 Jag Arya Kamsarmax

26 Jag Arnav Kamsarmax

27 Jag Ratan Supramax

28 Jag Rahul Supramax

29 Jag Rishi Supramax30 Jag Rani Supramax

31 Jag Roopa Supramax

9 Bulk Carriers; Average Age - 6.5 years

31 VesselsAverage Age - 10.6 years

Total dwt - 2.4 mn


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7

Vessels on Order & Capital Expenditure

Vessel Yard Expected Delivery

1 Medium Range

Product Tanker

STX Group Q4 FY16

3 Kamsarmax Dry BulkCarriers

Jiangsu New YangziShipbuilding Co. Ltd,

China

Q1 FY17, Q3 FY17 &Q4 FY18

Committed Capex - $120 mn

Paid till2014-15

Paid YTD2015-16

(To be paid)2015-16

(To be paid)2016-17

(To be paid)2017-18

$16 mn $22 mn $20 mn $44 mn $18 mn

Vessels on Order & Expected Delivery

Committed Capex & Payment Schedule


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8

Tankers – Asset Prices (5-year old)

0

20

40

60

80

100

120

140

160

180

2 0 0 1 - 0 1

2 0 0 1 - 1 2

2 0 0 2 - 1 1

2 0 0 3 - 1 0

2 0 0 4 - 0 9

2 0 0 5 - 0 8

2 0 0 6 - 0 7

2 0 0 7 - 0 6

2 0 0 8 - 0 5

2 0 0 9 - 0 4

2 0 1 0 - 0 3

2 0 1 1 - 0 2

2 0 1 2 - 0 1

2 0 1 2 - 1 2

2 0 1 3 - 1 1

2 0 1 4 - 1 0

2 0 1 5 - 0 9

USD mnVLCC Suezmax MR

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

90.00

VLCC Suezmax MR

USD mn

2011 2012 2013 2014 2015

Source – Industry Reports


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9

Bulkers – Asset Prices (5-year old)

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

45.00

50.00

Capesize Panamax Supramax

USD mn

2011 2012 2013 2014 2015

-

20

40

60

80

100

120

140

160

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2 0 0 1 - 0 1

2 0 0 1 - 1 2

2 0 0 2 - 1 1

2 0 0 3 - 1 0

2 0 0 4 - 0 9

2 0 0 5 - 0 8

2 0 0 6 - 0 7

2 0 0 7 - 0 6

2 0 0 8 - 0 5

2 0 0 9 - 0 4

2 0 1 0 - 0 3

2 0 1 1 - 0 2

2 0 1 2 - 0 1

2 0 1 2 - 1 2

2 0 1 3 - 1 1

2 0 1 4 - 1 0

2 0 1 5 - 0 9

USD mn

Capesize Panamax Supramax

Dry Bulk asset prices at 20-year low



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• Lower crude oil prices – Higher demand for end-products, esp. Gasoline

• Crude Surplus – SPR and commercial storage of crude, floating storage• Refinery runs exceeding demand – More product movement, storage on tanks, forced

storage on vessels

• Countries focusing on diversifying import sources leading to longer voyages

10

Low oil prices positively impacted tanker rates

400

600

800

1,000

1,200

1,400

J a n - 1 3

A p r - 1 3

J u l - 1 3

O c t - 1 3

J a n - 1 4

A p r - 1 4

J u l - 1 4

O c t - 1 4

J a n - 1 5

A p r - 1 5

J u l - 1 5

O c t - 1 5

J a n - 1 6

Baltic Exchange Dirty TankerIndex

400

500

600

700

800

900

J a n - 1 3

A p r - 1 3

J u l - 1 3

O c t - 1 3

J a n - 1 4

A p r - 1 4

J u l - 1 4

O c t - 1 4

J a n - 1 5

A p r - 1 5

J u l - 1 5

O c t - 1 5

J a n - 1 6

Baltic Exchange Clean TankerIndex



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11

Lower oil prices, leading to increased demand & refineryruns

40

50

60

70

80

90

100

110

120

130

-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

Q 2 2 0 1 0

Q 3 2 0 1 0

Q 4 2 0 1 0

Q 1 2 0 1 1

Q 2 2 0 1 1

Q 3 2 0 1 1

Q 4 2 0 1 1

Q 1 2 0 1 2

Q 2 2 0 1 2

Q 3 2 0 1 2

Q 4 2 0 1 2

Q 1 2 0 1 3

Q 2 2 0 1 3

Q 3 2 0 1 3

Q 4 2 0 1 3

Q 1 2 0 1 4

Q 2 2 0 1 4

Q 3 2 0 1 4

Q 4 2 0 1 4

Q 1 2 0 1 5

Q 2 2 0 1 5

Q 3 2 0 1 5

Q 4 2 0 1 5

$/bblmbpd

Global Refinery Crude Throughput y-o-y change (mbpd)

Oil demand y-o-y change (mbpd)

Oil Prices ($/bbl)



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12

Healthy refinery margins on account of high gasoline

demand

4.78

4.83

-20

2468

101214

J a n - 0 6

J u l - 0 6

J a n - 0 7

J u l - 0 7

J a n - 0 8

J u l - 0 8

J a n - 0 9

J u l - 0 9

J a n - 1 0

J u l - 1 0

J a n - 1 1

J u l - 1 1

J a n - 1 2

J u l - 1 2

J a n - 1 3

J u l - 1 3

J a n - 1 4

J u l - 1 4

J a n - 1 5

J u l - 1 5

J a n - 1 6

Europe Refining Margins

Brent-Rotterdam Margins 5yr Median

10.10

7.02

0

2

4

6

8

10

12

J a n - 0 6

N o v - 0 6

S e p - 0 7

J u l - 0 8

M a y - 0 9

M a r - 1 0

J a n - 1 1

N o v - 1 1

S e p - 1 2

J u l - 1 3

M a y - 1 4

M a r - 1 5

J a n - 1 6

Asia Refining Margins

Dubai-Singapore Margins 5yr Median

• High refinery margins, supported by strong gasoline cracks

• Middle Distillate demand is softer leading to storage on tanks,

forced storage on vessels



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Rising Product exports from Middle East

New export-oriented refineries leading to increased trade

0

200

400

600

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1000

1200

J a n 2 0 1 3

M a r 2 0 1 3

M a y 2 0 1 3

J u l 2 0 1 3

S e p 2 0 1 3

N o v 2 0 1 3

J a n 2 0 1 4

M a r 2 0 1 4

M a y 2 0 1 4

J u l 2 0 1 4

S e p 2 0 1 4

N o v 2 0 1 4

J a n 2 0 1 5

M a r 2 0 1 5

M a y 2 0 1 5

J u l 2 0 1 5

S e p 2 0 1 5

N o v 2 0 1 5

kbpd Naphtha Motor and aviation gasoline Kerosenes Gas/diesel oil

13



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Rising Naphtha imports from West to Asia supporting LRs

0

500

1,000

1,500

2,000

2,500

3,000

3,500

J a n - 0

8

J u l - 0 8

J a n - 0

9

J u l - 0 9

J a n - 1

0

J u l - 1 0

J a n - 1

1

J u l - 1 1

J a n - 1

2

J u l - 1 2

J a n - 1

3

J u l - 1 3

J a n - 1

4

J u l - 1 4

J a n - 1

5

J u l - 1 5

kt

Asian Naphtha Imports by Source

Middle East Asia West

52% 51%46% 45% 48%

40%34%

31%26% 24%

8%15%

23%30% 29%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2011 2012 2013 2014 2015

Asian Naphtha Imports - Market Share

ME Share Asia Share West Share

14



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Baltic Dry Index (Jan 2000 – Jan 2016)

Dry Bulk freight rates continued to plummet

• China slowdown leading to sharp moderation in iron ore imports

• Emphasis on environment leading to lower coal usage, sharp

decline in coal imports

0

20004000

6000

8000

10000

12000

14000

J a n - 0 0

J u l - 0 0

J a n - 0 1

J u l - 0 1

J a n - 0 2

J u l - 0 2

J a n - 0 3

J u l - 0 3

J a n - 0 4

J u l - 0 4

J a n - 0 5

J u l - 0 5

J a n - 0 6

J u l - 0 6

J a n - 0 7

J u l - 0 7

J a n - 0 8

J u l - 0 8

J a n - 0 9

J u l - 0 9

J a n - 1 0

J u l - 1 0

J a n - 1 1

J u l - 1 1

J a n - 1 2

J u l - 1 2

J a n - 1 3

J u l - 1 3

J a n - 1 4

J u l - 1 4

J a n - 1 5

J u l - 1 5

J a n - 1 6

BDI

15



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Steel Production fell in 2015

Moderation in China’s import growth, increase in short-

haul trade

-5%

0%

5%

10%

15%

0

500

1000

1500

2000

2013 2014 2015

mt

World ChinaGrowth in World Production (RHS) Growth in China Production (RHS)

China Iron Ore Imports (Source-wise)

10%

30%

50%

70%

0

500

1000

1500

2012 2013 2014 2015

mt

Australia Brazil Others

Market Share - Australia (RHS) Market Share - Brazil (RHS) Market Share - Others (RHS)

Growth – 13.8% Growth – 2.3%

16



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Coal imports by top importers on a declining trend

China coal imports

8.9

6.5

4.3

2.12.9

2.6

-1.1 -0.7

-4.0

-0.6

-3.9

-6

-4

-2

0

2

4

6

8

10

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov

mtIndian Coal Imports - 2015 YoY

Growth

-18.2

-7.3 -7.6-6.9

-9.3

-8.1

-1.4-0.9

-3.4

-6.0

-4.8

-20.0

-18.0

-16.0

-14.0

-12.0

-10.0

-8.0

-6.0

-4.0

-2.0

0.0

Jan Feb Mar AprMay Jun Jul Aug Sep Oct Nov

mt

Chinese Coal imports 2015 YoYGrowth

India coal imports

17



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World Fleet Growth

Gross Fleet Addition

Fleet

CY2016 CY2017 CY2018+Feb 16

(in mn dwt)

Crude tankers 338.3 8% 8% 3%

Product tankers 142.5 10% 8% 3%

Dry bulk carriers 778.8 11% 3% 1%

0

200

400

600

800

1000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Dry Bulk Crude Product

Mn.dwt

Fleet

18



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Accelerated scrapping in Dry Bulk

Scrapping as % of world fleet (year-wise)Scrapping as % of world fleet (year-wise)

Vessel CategoryFleet as on Scrapping

Feb 16 2015 2014 2013

(in mn dwt) (% of beginning fleet)

Crude 338.3 0.2% 1% 2%

Product 142.5 0.2% 1% 2%

Bulk 778.8 4% 2% 3%



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Market Trends in brief

Tankers Dry Bulk

Low oil prices, high demand

Healthy refining margins & runs

SPR, commercial storage & floating

storage

Diversification of import sources, new

export-oriented refineries alterington-mile

Risk of demand slowdown

Change in OPEC’s stance

Expected increase in tanker supply

Decline in China’s steel production, iron

ore import dependency already at higher

levels

China Coal imports declining – Govt’s

focus on pollution control, renewables

Increase in India’s domestic coal

production

Stimulus measures by China

Continued scrapping, slippage, lower

ordering & delaying delivery of vessels

from yards


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Greatship (India) Limited(a 100% subsidiary)

Business Review

February 2016


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22

Current Owned Fleet

• 4 Jack Up Rigs (350ft)

• 5 Platform Supply Vessels (PSV)

• 8 Anchor Handling Tug cum Supply

Vessels (AHTSV)

• 2 Multipurpose Platform Supply and

Support Vessels (MPSSV)

• 6 Platform / ROV Support Vessels

(ROVSV)

Offshore business- Fleet Profile

The Greatship Group

Category

Extent of coverage of

fleet's operating days(per cent)

(Q4FY16)

PSV 74

ROVSV 83

AHTSV 92

MPSSV 5

Jackup Rigs 91

High Fleet Utilization


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23

Greatship’s Modern & Technologically Advanced Fleet & High

Utilization

- Higher utilization rates

- Minimum down time

- Higher utilization rates

- Minimum down timeRevenue

Efficiencies

Revenue

Efficiencies

- Lower Operating costs

- Reduced maintenance

capex & opex

- Lower Operating costs

- Reduced maintenance

capex & opex

Cost

Efficiencies

Cost

Efficiencies

Young FleetYoung Fleet

Young jack-up fleet with an average age

of approx. 4.5 years

Demand shifting to modern vessels,

especially as safety becomes a major

concern for oil companies

Technologically AdvancedTechnologically Advanced

Specialized/technologically advanced

vessels equipped with DP I/DP II

(Dynamic Positioning) and FiFi I (Fire

Fighting) technologies

Equipped to operate in challenging

environments

Efficient and versatile vessels


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Double-digit decline in capex spending in 2016

2 years of continuous decline in capex spending



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25

Source: Rigzone, Marinebase, Industry Reports

• Actual deliveries much lower than estimated deliveries in 2015. Trend is

likely to continue in 2016

• Jack-up utilisation has dropped to 70% or lower from ~90% at the startof 2014 while roughly 40-50% of AHTSVs and PSVs are idle/stacked or

working spot

(Nos) Jackup Rigs AHTSVs PSV

Current Fleet 484 1913 1428

Orderbook 129 207 261

% of O/B to currentleet 25% 13% 18%

Fleet & Orderbook

Global Fleet Supply – Offshore


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FINANCIAL HIGHLIGHTS

Q3 FY 2015-16


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Q3 FY 2015-16 Financial Highlights

Standalone ConsolidatedKey Figures

Q3FY'16 Q3FY'15 9MFY'16 (Amount in Rs. crs) Q3FY'16 Q3FY'15 9MFY'16

Key financial figures

45.96% 40.37% 52.51% EBITDA Margin (%) 55.91% 43.09% 57.43%

7.68% 5.55% 13.27% Return on Equity (ROE) (%) 13.12% 9.87% 16.38%

7.18% 5.76% 10.67% Return on Capital Employed (ROCE) (%) 9.55% 7.52% 11.19%

0.52 0.63 0.52 Gross Debt/Equity Ratio (x) 0.70 0.82 0.70

(0.04) 0.10 (0.04) Net Debt/Equity Ratio (x) 0.22 0.36 0.22

65.85 61.87 64.56 Exchange rate USD/INR, average (Rs) 65.85 61.87 64.56

66.15 63.04 66.15Exchange rate USD/INR, end of period (Rs)

66.15 63.04 66.15

Share related figures

6.79 4.58 34.07 Earnings per share, EPS (Rs) 18.23 12.05 65.08

6.77 4.57 34.01 Diluted earnings per share (Rs) 18.19 12.03 64.95

13.19 10.25 50.88 Cash Profit per share (Rs) 30.44 22.54 99.05

6.00 - 6.00 Dividend per share (Rs) 6.00 - 6.00


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THANK YOU

visit us at www.greatship.com

Documents

Revised Investor Meet Presentation [Company Update]