Angel Fibers Ltd. Investor Presentation - 2018

Disclaimer

This Investor Presentation has been prepared by Guiness Corporate Advisors Pvt. Ltd. in consultation with

Angel Fibers Limited and does not constitute a prospectus or placement memorandum or an offer to acquire

any securities. This presentation or any other documentation or information (or any part thereof) delivered or

supplied should not be deemed to constitute an offer. No representation or warranty, express or implied is

made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of such

information or opinions contained herein. The information contained in this presentation is only current as of

its date. Certain statements made in this presentation may not be based on historical information or facts

and may be “forward looking statements”, including those relating to the general business plans and strategy

of Angel Fibers its future financial condition and growth prospects, future developments in its industry and its

competitive and regulatory environment, and statements which contain words or phrases such as ‘will’,

‘expected to’, ‘horizons of growth’, ‘strong growth prospects’, etc., or similar expressions or variations of such

expressions. These forward-looking statements involve a number of risks, uncertainties and other factors that

could cause actual results, opportunities and growth potential to differ materially from those suggested by

the forward-looking statements. Further, no representation or warranty expressed or implied is made nor is

any responsibility of any kind accepted with respect to the completeness or accuracy of any information. Also,

no representation or warranty, express or implied, is made that such information remains unchanged in any

respect as of any date or dates after those stated herein with respect to matters concerning any statement

made in this Investor Presentation. Company may alter, modify or otherwise change in any manner the

content of this presentation, without obligation to notify any person of such revision or changes. This

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given or made, such information or representation must not be relied upon as having been authorized by or

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Company Overview

Industry Overview

Financial Snapshot

Issue Highlights

Company profile

• Incorporated in 2014, primarily in the business of spinning of cotton yarn. The manufacturing

facility with strong team of 140 people is situated at Kalavad in Jamanagar district of Gujarat state

which is in the heart of cotton growing areas of Maharashtra and Saurashtra (region) of Gujarat.

• Promoters Mr. Ashok Dudhagara and Mrs. Prafulaben Dudhagara with hands on experience in Cotton industry including developing healthy relations with brokers dealing in Cotton and Cotton Yarn which helps the company to market our product in domestic and overseas market.

• Expanded the business and operations significantly during the past three years

• In FY 2017 & 2016, company’s turnover (net) was Rs. 88.74 crore & Rs. 51.02 crore respectively and

for the period ended Sep 30, 2017 it was Rs. 46.08 crore

• Company’s profits for FY17, were Rs. 3.11 crore and for the period ended Sep 30, 2017 was Rs. 2.59

crore

1

3

4

• Established a capacity of total 19,584 spindles having installed capacity of 4363MT per

annum to manufacture cotton yarn 2

Our Vision is to provide world-class quality yarn at a competitive price to cater to the

domestic as well as international markets also to build and maintain long-term

relationship with customers by offering Best services.

Directors profile

Mr. Ashok M Dudhagara

CMD

Ms. Prafulaben A. Dudhagara

(Executive Director)

Mr. Nirav Baldha

(Independent Director)

Mr. Ketanbhai Vadaliya

(Independent Director)

Mr. Ankur Bakulesh Jani

(Non Executive

Director)

Mr. Ashok holds a Bachelor’s Degree in Science specializing in

Chemistry from Saurashtra University. He has an experience of over

11 years of experience in textile industry. He looks after purchase,

sales, manufacture, finance and administrative unit of the Company

She had completed master of Art from Saurashtra University

specializing in Home Science. She looks after the Human resource

department of the Company

He holds a Bachelor’s Degree in Commerce and has good

experience in building businesses

He holds a Diploma degree in the field of Mechanical Engineering

He holds Diploma certification in the field of Mechanical Engineering

Favorable textile policy giving boost to the business

Interest Subsidy by State Government on capital expenditure –

7%

Interest Subsidy by Central Government –

2%

VAT department concession – Rs. 50.44

crore

Power Excise duty exemption – 15%

Product profile

Current revenue mix is 80% sold to exports or domestic companies which caters to exports market and 20% for domestic consumption

• 100% Cotton Carded Yarn for Knitting and Weaving

• Ranges : NE 20s to NE 50s

Fully automated state of the art manufacturing

facility

Fully automated state of the art manufacturing

facility

Sr. No. Description/Name of Machinery Vendors Unit (In Nos)

1. Blow room Trutzschler India Pvt. Ltd. 1

2. Card Trutzschler India Pvt. Ltd. 11

3. Breaker D/F Rieter India Pvt. Ltd. 2

4. Omegalap Rieter India Pvt. Ltd. 1

5. Comber Rieter India Pvt. Ltd. 6

6. Finisher D/F Rieter India Pvt. Ltd. 4

7. Speed Frame Electrojet Amchinery Private Limited 4

8. Ring Frame Rieter India Pvt. Ltd. 8

9. Ring Frame Rieter India Pvt. Ltd. 4

10. Winding (Link Coner) Murata Machinery Limited 12

11. Cleaners with SIRO/FD Uster Technologies AG Installed with each machine

12. Yarn Conditioning Plant Sieger Spintech Equipments Pvt. Ltd. 1

13. Humidification Draft Air India Pvt. Ltd. 1

14. Lab Equipments Uster Technologies AG 6

Plant and Machinery

Fully automated plant from start to finishing of the final product

equipped with imported machines from across the world

Manufacturing Process

Input

Cotton bale

Lap

Spinning bobbing

Carded silver

Drawn Silver

Combed Silver

Lap

Drawn Silver

Roving

Manufacturing Process Output

Pre-combed drawing

Lap former

Combing

Simplex

Ring-spinning

Winding

(Auto corner) Cone

Roving

Drawn Silver

Yarn (Spinning lobbing)

Combed silver

Lap

Drawn silver

Carded silver

Lap Blow-room

Carding

Pre-combed drawing

Leading customers

Competitive strengths

• Promoters have 11

years of experience

in Cotton ginning

and pressing,

spinning and various

other activities.

• We believe that the

experience of our

management team

and its in-depth

knowledge of

business will enable

us to continue to

take advantage of

both current and

future opportunities.

Experienced

Management

• Cotton yarn

spinning unit with

19,584 spindles of

4363MT pa capacity

• Specialize in 30s Ne

Combed and 40s

Compact variety

• We have procured

fully automatic

plant for spinning

yarn with state of

the art modern

machines from

Germany and Japan

in order to produce

yarn of export

quality

State of Art

Infrastructure

• Company adheres

strictly on supplying

quality products.

Each products passes

through strict quality

checks

• Quality assurance

measures include

checking of all raw

materials and

production process

and intensive care is

taken to determine

the standard of each

and every product

dispatched.

Quality

Assurance

• Unit is registered

under EPCG scheme

for 100% Custom Duty

Exemption and 2%

Interest Subsidy on

Term Loan from

Ministry of Textiles as

well as 7% Interest

Subsidy from State

Govt.

• Also it is eligible for

electricity subsidy of

Re 1 per unit in

electricity charges

from State

Government and VAT,

now GST Exemption

on capital cost of

Project

Favourable Government Policies

Growth Drivers

Expanding

Capacity

Continuously expanding capacities in spinning and will

enter in to forward integration of manufacturing fabric

Operational

Efficiencies

Fully integrated and automated plant with less dependent on

labour completely imported plant from across the world

Leading

customers

Boasts of leading textile players as its clients, like Donear, Welspun,

Excel Enterprises, Vicky Fashion, Sangam Suitings, Siyaram’s, Relishah

Exports and also deals with leading merchant exporters high quality

yarn

Increase

Geographic

al Presence

Our emphasis is on expanding the scale of our operations as well as

growing our supply chain network, which we believe will provide

attractive opportunities to grow our client base and revenues.

Cost

Effective

We intend to maintain the cost competitiveness and offer the

quality products at reasonable prices.

Proven business model with potential to be a large

textile player

SWOT

Strengths: Well established business, proven

business model and tested growth

Excellent track record with loyal

client base

Integrated value chain with controls

on sourcing, manufacturing,

distribution and selling

Weakness:

Capex intensive

Opportunities:

Forward integration into fabric

manufacturing

Geography expansion, category expansion

Economies of scale for better realization

and cost optimization after expanding the

current capacity

Threats:

Any change in government policy or

removal of subsidies

Labour Laws, seasonality, geographic

dependency, raw material

availability

Company Overview

Industry Overview

Financial Snapshot

Issue Highlights

• Production of raw cotton in India grew from 28 mn bales in FY07 to 35 mn bales in FY17.

• Cotton’s high prices in 2016-17 will encourage farmers to grow more cotton in 2017-18

• The area under cotton cultivation will increase by 7 per cent to reach 11.3 mn hectares in

2017-18, due to better returns on improved crop yield in 2016-17.

• Indian khadi products sales increased by 33% year-on-year to Rs. 2,005 crore in 2016- 17and is

expected to exceed Rs. 5,000 crore sales target for 2018-19, as per Khadi and Village Ission (KVIC).

Favorable market, good growth trends and positive

outlook on the industry

USD

137 bn

USD

226 bn

2023 2016

• Indian Textile Ind is pegged to grow from

USD 137 bn in 2016 to USD 226 bn by

2023.

• Central government policy aims to

achieve USD 300 bn worth of textile

exports by 2024-25 and create an

additional 35 mn jobs.

Source: https://www.ibef.org/exports/apparel-industry-india.aspx

Handicrafts reached USD 443.64 mn during the same period

and had a share of 4.5% in overall textile exports

During the same period, fiber, yarn, fabric, and made ups

exports reached USD 2.5 bn, USD 5.3 bn, USD 4.3 bn, and

USD 4.7 bn, respectively.

During FY17, India exported textile items worth USD 37

bn. Ready made garments had a share of 48% in these

exports and had reached USD 17.5 bn.

India took the top spot in market share in the men/boys

knitwear shirts cotton' category with respect to garment

exports to the US between Jan-Jun 2017

India is the world's 2nd largest manufacturer and exporter of

textiles and apparels, with a massive raw material and

Manufacturing base.

Leveraging the export base of India

Notable Trends in Indian Textile’s Sector

Increasing

investment in

TUSF Scheme

• Ministry of textiles is encouraging investments through increasing focus on

schemes such as TUSF & cluster development activities.

• TUSF for the textile sector to continue with an investment target of USD 24.8

bn. Ministry of Textiles released a subsidy of USD 260 mn in FY 17.

Multi - Fibre

Arrangement

Public Private

Partnership

Technical

Textiles

• With the expiry of MFA in January 2005, cotton prices in India are now fully

integrated with international rates. In 2014, the government has cleared 13

proposal of new textile parks in different states.

• The Ministry of Textiles commenced an initiative to establish institutes under

the Public Private Partnership (PPP) model to encourage private sector

participation in the development of the industry.

• Technical textiles, which has been growing at around twice the rate of

textiles for clothing applications over the past few years, is now expected to post a

CAGR of 20% FY11-17.

Company Overview

Industry Overview

Financial Snapshot

Issue Highlights

971

1,749

879

2016 2017 Sept, 2017

(565)

311 259

2016 2017 Sept, 2017

(INR in lakhs)

(INR in lakhs)

2,246 2,246

2,505

2016 2017 Sept, 2017

(INR in lakhs)

Total Revenues EBITDA (INR in lakhs)

PAT Networth

Key Figures

5,102

8,874

4,608

2016 2017 Sept, 2017

Balance Sheet: Liabilities

Balance Sheet: Assets

Profit and Loss A/c

Company Overview

Industry Overview

Financial Snapshot

Issue Highlights

Issue highlights

Issue Size

Initial Public Offering of up to 67,48,000 Equity Shares of Face Value of

Rs.10 each of Angels Fibers Limited for cash at a price of ` Rs. 27 per

Equity Share (including Share Premium of ` Rs. 17 per Equity Share)

aggregating up to ` Rs. 18.2196 crore

Number of shares

offered

Book Running

Laed Managers

Listing

Sr.

No.

Name of the Selling

Shareholder

Category of

Shareholders

No. of Equity Shares

offered for sale

1 Ashok Dudhagara Promoter Upto 55,50,000

2 Prafulaben Dudhagara Promoter Upto 11,98,000

Details Particulars

Issuer Angel Fibers Limited

Offer Type Fixed Price Issue

Fixed price Rs 27 per share

Minimum Lot Size 4000 Equity Shares & in multiples their off

IPO Venue BSE SME

Offer Size 67,48,000 Equity Share of Rs. 10 each at a price of

Rs. 27 per share

Issue opens on 20th February, 2018

Issue closes on 23rd February, 2018

Offer Structure Market Maker Portion: 3,40,000 Equity Shares

Net Issue Portion: 64,08,000 Equity Shares

Issue Highlights

ISSUER COMPANY LEAD MANAGER

GUINESS CORPORATE ADVISORS PVT LTD

ANGEL FIBERS LTD