Crea%ng

 value  as  India’s  leading  consumer  wellness  company  

Heinz  India  
1  
 Zydus  Wellness:  earliest  entrant  and    
category  builder  in  the  wellness  segment  
•  India  is  poised  for  rapid    growth  in  the  wellness  segment  
•  Research  shows  that  an    increasingly  larger  propor7on  of  
Indian  consumers  are  taking    direct  control  of  their  health  
•  Market  dynamics  moving    towards  preven7ve    healthcare  and  
healthier  lifestyles  
•  A    2016  survey  reported  that    a  healthier  lifestyle    was    the  
topmost  (48%)  consumer  goal  among  Indian  consumers  (Mintel)  
•  Emerging  middle  class  and  rural  opportunity  
•  ~  40  crs  middle  class  (1)  Indian  consumers  in  next  3  years  along  
with  improving  rural  penetra7on  

2  
 Zydus  Wellness:  Poised  for  the  Next  Big  Leap  

•  ZWL  has  demonstrated  a  track    record  of  building  new    

emerging  categories,  with  differen7ated  product    proposi7ons  
•  Philosophy  of    building  products  that  empower  consumers  to    
take  direct  control  of  their  wellness  goals  
•  Unparalleled  delivery    of  consumer  value,  transla7ng    into  a  22x  
increase  in  shareholder  value  in  the  last  9  years  to  reach  a  
market  valua7on  of  *  INR  5,000  crs  +    
•  Ac7vely  scou7ng  for  products  that  complement  ZWL’s  exis7ng    
range  and  hence  provide  opportunity  to  further  enhance  value  
for  all  stakeholders  
* As  on  30th  Jun’18

3  
 Zydus  Wellness  
 a  diversified  wellness  experience  

VISION   Who  we  are  

   
We  bring  Wellness  to  your  life   We  build  new  emergent  categories  with  
  differen7ated  product  proposi7ons  
We  will  create  new  experiences  by  our    
products  that  will  nourish,  nurture  and   Philosophy  of  building  products  that  are  
energize  your  life   “Good  for  you”  
   
We  shall  lead  the  way  through  
innova7on  
 

4  
 Delivering  holis%c  access  to  health  and  wellness  

Rich  group  legacy   Innova%on-­‐led   Consumer  trust  

§  66  years  of  singular   §  Strong  scien7fic  and   §  Highly  trusted  brands  
focus  on  healthcare   medical  heritage   §  Customer-­‐centric  business  
§  Proven  track  record  of   §  Science  and  innova%on-­‐led   philosophy  
value-­‐added  products   product  poraolio   §  Strong  reputa%on  of  
§  Quality  &  Opera7onal   §  Category  creator   addressing  wellness  needs  
excellence   of  mul7ple  consumer  
  groups    

5  
 22x  increase  in  shareholder  value  in  the    
last  9  years  to  reach  a  market  valua7on  of  *  INR  5,000  crs  +    

New  produc7on   Sugar  Free  Green  with  Stevia  &   Launch  of  
Everyuth  Skincare   Acquisi7on  of  Carna7on   facility  at  Sikkim  –   new  produc7on  facility  at   ‘Sugarlite’  
range   Nutra  (CANFL)   Unit  I   Sikkim  –  Unit  II  
1991   2006   2011   2017   2018  

1988   2005   2009   2014   2018   2018-­‐19  

Sugar  Free  with   Sugar  Free  Natura  with   Zydus  Wellness  carved  out     Distribu7on   EY  Tan  Removal  range  &  
Aspartame   Sucralose   and  listed  on  NSE   revamp   Nutralite  Mayonnaise   Agreement  
for  
Acquisi%on    
of    
Heinz  India  

* As  on  30th  Jun’18

6  
 Zydus  Wellness  to  acquire  Heinz  India  Pvt  Ltd.,  
catapul%ng  it  amongst  the  leading  consumer  wellness  
business  in  India  

7  
 Transac%on  highlights  
Zydus  Wellness  (jointly  with  Cadila  Healthcare)  to  acquire  100%  of  Heinz  India  Private  Limited    
(“Heinz  India”)  for  a  considera%on  of  ~  INR  4,595  crs  (“Transac%on”)    
This  valua4on  includes  net  working  capital  of  Rs.  40  crores,  cash  of  Rs.  15  crore  and  assumes  no  debt.    

Gains  a  poraolio  of  category  leading  brands  –   Significant  synergy  poten7al  across  
1   Glucon  D,  Complan,  Nycil  and  Sampri7  with   4   distribu7on,  supply  chain  and  manufacturing  
revenues  (1)  of  ~  INR  1,150  crs  

Enables  Zydus  Wellness  to  become  a  leading  

2   Consumer  Wellness  Company  in  India  with   5  
Transac7on  will  be  financed  through  a  
combina7on  of  equity  and  debt  
revenues  of  ~  INR  1,680  crs  

Creates  a  formidable  brand  poraolio  with  5  of  7   Transac7on    is  likely  to  close  by  Q4  FY2019  
3   brands  being  market  leaders  in  large  and  growing   6   subject  to  regulatory  and  other  customary  
categories  (>  INR  11,000  crs)   approvals  

(1)  Net  sales  of  Heinz  India  is  for  12  months  ended  30  June  2018  

8  
 A  strong  poreolio  of  legacy  brands  with  established  brand  leaders  

1988  
1933  

1969  

1951  
India’s  trusted   #1  glucose  based  energy   #1  prickly  heat   Premium  ghee    
health  food  drink   drink  in  India   powder  in  India  

Extensive  pan  India  distribu7on  network  

800+   Distributors   17  lakh   Retailers   21   Warehouses   ~  1,000   Field  force  

Manufacturing  and  supply  chain  

2  manufacturing  facili7es  at  Aligarh  and   Milk  collec7on:  90,000+  farmers  
Sitarganj  with  adequate  capacity  for  growth   with  poten7al  to  add  more  
and  further  scalability  

9  
 Crea%ng  India’s  leading  consumer  wellness  company  

Build  a  diversified   §  Trusted  brands  with  a  strong  

§  Rare  opportunity  to  acquire  ‘INR   Become  a  leading  
poreolio  of  brands  
1,000+  crs’  consumer  wellness   consumer  wellness   brand  recall  value  
across  Wellness  foods  
business   player  in  India   §  5  of  7  category  leading  brands  
and  care  

§  Complementary  distribu7on     §  Leverage  scien%fic  capabili7es  

with  addi7on  of  a  large  general   and  innova%on  track  record    
trade  channel  to  an  exis7ng   Strengthen     Mul%ple  levers  to  drive  
growth  and  profitability  
§  Drive  penetra7on  and  channel  
pharmacy  channel   route  to  market  
op7miza7on  

10  
 Value    accre%ve  acquisi%on  
•  Unparalleled  opportunity  to  build  a  highly  scaled-­‐up  and  synergis7c  poraolio  
•  3x  jump  in  revenues  and    EBITDA  
•  Taps  complementari7es  in  rural  and  urban  markets  

Heinz  India  

SAMPRITI  
SAMPRITI  

Revenues:  ~  INR  530  crs   Revenues:  ~  INR  1,150  crs   Revenues:  ~  INR  1,680  crs  

EBITDA:  ~  INR  125  crs   EBITDA:  ~  INR  225  crs   EBITDA:  ~  INR  350  crs  
Revenue  and  EBITDA    are  for  12  months  ended  30  June  2018  

11  
 Instant  boost  in  share  of  wellness  pie  
All  brands  addressing  daily  health  and  wellness  needs    
Foods   Skin  care  
Instant  energy   Premium     Natural     Prickly  heat  
Health  food  drink   Sugar  subs%tute   Buier  subs%tute  
powder   healthy  ghee   skin  care   powder  

SAMPRITI  

#1   #4   #1   #1   #1(1)   #1  

(1)  Rank  within  scrubs  and  peel  offs  sub-­‐category  -­‐  85%  market  share  in  the    
peel-­‐offs  sub-­‐category  and  34%  market  share  in  the  scrubs  sub-­‐category  

#X   Market  rank  
12  
 Complementary  strengths  in  distribu%on  channels  

Key  Strengths   Way  Forward    

•  Speciality  channels  –  chemists,  cosme7c,  horeca   Omni  channel  strategy  leveraging  
Zydus  Wellness   •  Organized  trade  &  significant  scale  up  in  e-­‐commerce   strengths  of  the  combined  en7ty  
 •    Pan  India  footprint    
•  Expanding  reach  for  grocers  and  rural    
 
Opportunity  to    
•  Increase  access  to  rural  markets  

Key  Strengths   •  Double  the  direct  reach  

•  Wholesale  and  rural  reach  led  by  Glucon  D  reaching  1.7  mn  stores   •  Enhance  engagement  with  key  
•  Good  presence  in  grocers   accounts  across  organized  trade  and  
HIPL  
•  Pan  India  footprint   e-­‐commerce  
•  Expanding  reach  for  modern  trade  and  e-­‐commerce   •  Benefit  from  wider  talent  pool  and  
capabili7es  
 

13  
 Significant  synergy  poten%al  in  the  combined  business  

Possible  revenue  synergies   Possible  cost  savings  

Leverage  distribu7on  channels  to  drive   Manufacturing  efficiency  across  

higher  revenue  growth   mul7ple  processes  

Product  innova7on  leveraging  the   Supply  chain  efficiencies  due  to  

Zydus  Cadila  group  heritage   complementarity  of  channels  

14  
 Poreolio    
of  brands  

15  
 Leading  brand  with  98%  
product  recall  value  
§  Most  distributed  brand  in  the  category  at    
1.7mn  stores  (Largest  compe7tor  at  0.9  mn)  
§  Category  growing  at  6-­‐7%  with  low  household  
penetra7on  of  ~  12%  
§  Mul7ple  growth  drivers  include  enhancing  rural  
penetra7on,  launching  new  flavored  variants,  
innova7ve  products  and  expansion  into  adjacencies  

Regular Mango Punch Tangy Orange Nimbu Pani

16  
 Legacy  trusted  brand  with  
90%  recall  value  
§  Milk  based  Health  Food  Drink    
§  One  of  the  Highest  protein  content  in  the  low  penetra7on  

(24%)  health  food  drink  category  

§  Reposi7oned  the  brand  in  2017  leading  to  enhanced  brand  
performance  in  2018  
§  Mul7ple  growth  drivers  include  enhancing  distribu7on  
network  by  leveraging  the  pharmacy  channel  strength  of  
the  Zydus  group,  innova7ve  premium  launches  and  
expansion  into  adjacencies    

17  
 Market  leading  and  legacy  brand  in  the  
prickly  heat  powder  category    
§  Prickly  heat  powder  for  summer  skin  problems  
§  Fast  growing  prickly  heat  powder  category  at  9%+  
§  Maintained  consistent  ~  34%  market  share  despite  growing  compe77on  
§  100%  customer  awareness  score  and  strong  customer  loyalty  
§  Mul7ple  growth  drivers  include  expansion  of  distribu7on  and  expansion  
into  adjacencies  by  leveraging  brand  equity  for  innova7on  
 

18  
 Fast  growing  market  category  at  ~  18%  CAGR  
§  Quality  ‘Ghee’  for  cooking  
§  Currently  a  by-­‐product  of  Complan  manufacturing  
§  Highly  fragmented  market  with  only  2  players  holding  
>10%  market  share  
§  Primarily  sold  in  the  food  service  channel  
§  Mul7ple  growth  drivers  include  expansion  of  the  retail  
channel  and  innova7ng  through  value-­‐added  dairy  
launches  

“Heinz”  trade  name  will  be  discon4nued  in  a  certain  4me  period  aNer  closing  as  agreed  
SAMPRITI  

19  
India’s  1st  low  calorie  sugar  subs%tute  

§  Undisputed  market  leader  with  category  

defining  market  share  of    ~  94%    
§  Significant  growth  poten7al  60  mn+  diabe7cs  in  
India  with  an  increasingly  health-­‐conscious  
urban  popula7on  
§  Category  leadership  reinforced  through  
innova7ve  products  like  Sugar  Free  Green  and  
Sugarlite  

20  
 Nutralite  -­‐  India’s  #1  buier  subs%tute  and  leader  
of  low  calorie  spread  category  
§  Healthier  alterna7ve  to  buter  /  table  spreads  
§  Opportunity  to  part  capture  the  organized  buter  market  
in  India  
§  Demonstrated  category  and  brand  leadership  through  –    
-­‐  Expansion  into    the  INR  700  crs+  mayonnaise  market  
growing  at  20%+  
-­‐  Innova7ve  products  like  flavored  fat  spreads  to  extend  
the  low  calorie  spread  category  
§  Opportunity  to  extend  other  breakfast  and  snacking  
spaces  

21  
Everyuth  -­‐  Facial  cleansing  with  a  
strong  ‘Naturals’  brand  equity  
§  Large  market  growing  at  10%+  
§  Market  leader  in  2  of  3  facial  cleansing  and  skincare  
 sub-­‐categories  growing  ahead  of  the  category  
§  Pioneer  of  Scrubs  (~  33%  market  share)  and    
Peel  Offs  (~  85%  market  share)    
§  Strong  brand  growth  exceeding  category  growth  of  10%+  
§  Growth  drivers  include  increasing  penetra7on  of  Scrubs  and  
Peel  Off  masks  and  premium  skin  care  launches  like  tan  removal  
packs  

22  
 Fundamentals  now  in  place  to  become  a  
consumer  wellness  leader  

Category  leadership  with   To  leverage  whitespace          

significant  growth  headroom   opportuni7es  

Proven  performance  and  value  

Innova7on  track  record   crea7on  track  record  

Strong  opera7onal  and   Clear  margin  and  returns  

distribu7on  capabili7es   progression  roadmap  

23  
  Crea%ng  a  stronghold  in  a  Cri%cal  Growth  Market    
Growth  Opportunity  in  a  large  and  expansive  market   One  of  the  largest  and  fastest  growing  markets  of  consumer  health  

Leveraging  a  proven  track  record  of  science  and  

innova7on  driven  products   A  pioneer  and  a  category-­‐creator  

Leadership  Brands   Market  leaders  in  key  segments    

Aligns  with  the  core  business  of  Health  Food,   Strong  overarching  purpose  of  energizing,  engaging  and  
Nutri7on  and  Skincare   enriching  lives  

Strong  Partnerships   Successful  track  record  of  acquisi7ons  and  integra7ng  

cultures  across  the  group  

Long  -­‐  term  value  for  shareholders,  employees,  partners,  customers  &  
Crea7ng  Value  for  all  Stakeholders    
communi7es  

24  
 How  the  deal  unlocks  value  

Consumers   Employees     Communi%es     Shareholders    

•  Science  and  innova7on   •  Beter  career  prospects   •  Support  farmers  and   •  Atrac7ve  growth  market  
backed  products   develop  supply  chains  
•  Exci7ng  work   •  Strengthens  product  
•  Time  tested,  trusted     opportuni7es   •  Suppor7ng  healthy   poraolio    
lifestyles  
•  Enhanced  access     •  Stronger  business   •  Generates  long-­‐term  value  
 

25  
 Thank  you  

26