Tata Motors Passenger Vehicles Ltd · NSE:TMPV
Tata Motors Passenger Vehicles — Tata Motors — Q4 FY2019 Earnings Presentation
65 slides from Tata Motors Passenger Vehicles's earnings presentation, May 20, 2019
Slide 1: Tata Motors Group: Results Q4 FY'19
TATA MOTORS WINNER TATA MOTORS GROUP : RESULTS Q4 FY'19 | 20 May 2019
Slide 2: Safe harbor statement
Safe harbor statement TATA MOTORS Statements in this presentation describing the objectives, projections, estimates and expectations of Tata Motors Limited (the “Company”, “Group” or ‘TML") Jaguar Land Rover Automotive plc ("JLR ") and its other direct and indirect subsidiaries may be “forward-looki
Slide 3: Challenging market conditions across the globe
Challenging market conditions across the globe TATA MOTORS 0 High Incentives Market Cyclicality 9 Qoieset uncertainty Brexit Trade warsjand Macro Diesel uncertainty headwinds Market, Cyclicality High incentives Low consumer confidence \“) Muted demand environment Axle load changes impact Liquidity c
Slide 4: Products and other key developments
Products and other key developments TATA MOTORS Tata Harrier on sale from January 2019 Next-Gen products displayed in Geneva Auto Expo At the forefront of E-mobility evolution-Won various Electric bus contracts (West Bengal,Lucknow,|ndore) All New Evoque with hybrid options now on sale | Pace awarde
Slide 5: Q4 FY'19 & FY19 Consolidated
Q4FY'19_8& FY19 Consolidated oo . . Q4: TML returns to profits in a challenging environment ‘Turnaround 2.0’ delivers; Project Charge on track TATA MOTORS =Cr. Q4 FY'18 Q4 FY'19 Change =Cr. FY18 FY19 Change Volumes (units)* 389,205 357,219 (8.2%) Volumes (units)* 12,82,321 13,05,002 1.8% Revenue 89,
Slide 6: FY'19 Consolidated revenue
FY'19 Consolidated Revenue up 3.7% on TML(S) and favourable forex TATA MOTORS Net revenue at 2 301.9 K Cr up 3.7 % Rs ‘000 Cr 3.4 58 14.5 13 2912 301.9 (2.0%) (0.5%) 5.0% 12% | 3.7% growth FY18 Volume &Mix Price Translation Others FY19 17 45 0.2 15.2 291.2 3019 (5.2%) 4.0% 5.0% (0.1%) 3.7% growth FY
Slide 7: FY'19 Consolidated EBIT
FY'19 Consolidated EBIT at 1.2% (down 290 bps) TATA MOTORS Drop in JLR profitability impacted the Y-o-Y performance JLR EBIT reflects * China impact, * Negative operating leverage from lower wholesales, 11845 MI0/668) TML (S) EBIT reflects Bt * Savings from ImpACT projects and positive operating 364
Slide 8: Free Cash Flows (Auto) outflow
FY'19 Free Cash Flows (Auto) outflow of #(9.2KCr); TATA MOTORS Auto FCF Net Auto Debt Movement (2,659) =—=—= Fd 0 f ! Lid a 13,889 =z (31,371) PBT (FY19) Non Cash Tax Cash PAT Investment W.Cap TMF (Net) Auto FCF Mar 31, 2018 Auto FCF Interest & Others Mar 31, 2019 (210) 28,394 emtmrrrtrtccc 7) Other
Slide 9: The cylinders of Tata Motors
The 6 cylinders of Tata Motors TATA MOTORS 3. CV “Ten pre (a Wiie=: TATA Motorfinance | What are you Looking for? of & rt i Finance == 6 w 6. Net debt & others
Slide 10: 1&2: Jaguar Land Rover
1&2: Jaguar Land Rover TATA MOTORS i . 5.™ — 4 a Finance JAGUAR Dr. Ralf Speth and Kenneth Gregor
Slide 11: Jaguar Land Rover
Jaguar Land Rover Dr Ralf Speth and Ken Gregor
Slide 12: Management change announcement
Management change announcement Chief Financial Officer, JLR Ken Gregor Adrian Mardell Thank You ! Welcome !
Slide 13: JLR Q4 FY'19 & FY19
Q4FY'19 & FYI9 PBT (bei) £269m Q4, £(358)m FY PBT after exceptionals £120m Q4, £(3.6)b FY £Mn. Q4 FY'18 Q4 FY'19 Change £Mn. FY18 FY19 Change Retails (K)* 172.7 158.9 (8.0%) Retails (K) ~ 614.3 578.9 (5.8%) Revenue 7,555 7,134 (5.6%) Revenue 25,786 24,214 (6.1%) EBITDA% 12.2% 9.8% (240 bps) EBITDA%
Slide 14: China JV-CJLR: Q4 FY'19 & FY19
China JV-CJLR :-Q4FY'19 & FY19 Revenue £1.7b, break even profit Lower sales and production downtime to reduce inventory £Mn. Q4 FY'18 Q4 FY'19 Change £Mn. FY18 FY19 Change Retails (K)* 22.3 11.2 (49.9%) Retails (K) ~ 87.8 57.6 (34.4%) Revenue 276 (56.9%) Revenue 2,773 1,697 (38.8%) EBITDA% 37.7% 5.4
Slide 15: FY19 Retails by market
FY19 Retails 578.9k, down 5.8% due to China North America and UK up, better than industry Units in ‘OOO 578.9 117.9 vi Be 4 7 \ oven »| North America UK Europe China Overseas* Total china 512 JLRYoY 8.1% 8.4% (4.5)% (34.1)% 2.3% (5.8)% vie Industry (0.5)% (37% (0.9)% (8.3)% +2.9% Ea Wholesales Units
Slide 16: Wholesales units YoY
Retail units in ‘000 Wholesales Units 30.7 24.5 4.2 45.0 14.5 50.9 7.7 84.4 37.6 65.4 60.8 82.6 57.1 YoY (1.4) (17.2) (4.8) 30.3 14.5 (18.7) (1.5) (33.8) (14.4) (31.0) (1.5) 6.0 2.1
Slide 17: 1,200 1,000 (200) (400) (600)
1,200 1,000 800 600 400 200 0 (200) (400) (600)
Slide 18: (100) (200) (300) (2.6)% 3.2% 1.8% 0.3% 0.3% .0%
300 200 100 0 (100) (200) (300) (2.6)% 3.2% 1.8% 0.3% 0.3% 3.0%
Slide 19: Cash outflow £1.3b after £3.8b investment
FY19 Cash outflow £1.3b after £3.8b investment Q4 £1.4b positive - PBT,working capital (incl. Charge), lower investment IFRS, £m D&A £2,164m Q4FY19 FY19 Payables 712 (419) Inventory 570 152 2,723 (227) Receivables (135) 249 (3,810) Other* 202 423 Working capital charge 1349 405 405 PBT (bei) Non-cas
Slide 20: Investment spending £3.8b
FY19 Investment spending £3.8b Lower than £4b Charge target IFRS, £m YTD Investments ™ Products 19% = Powertrain Be 1,813 3,810 = Electrification CA Capacity & Others 5% 421 1,997 1,576 Capitalised . Expensed . Total Capital Total R&D R&D R&D Investment* Investment Q4 FY19 341 96 437 292 729 * Prima
Slide 21: Update on JLR Turnaround and Transformation plan
Update on JLR Turnaround and Transformation plan
Slide 22: Turnaround and transformation plan
Turnaround and transformation plan Proactive response to improve results in a challenging environment 1. Strong pipeline of new and refreshed products to improve sales, particularly in China IDEAS. ACTIONS. CASH 2. Project Charge to reduce cost and improve — profits and cash flow C H A R G E>>> 3. P
Slide 23: Improving sales: product portfolio
mproving sales Strong award-winning product portfolio Expanded to 13 nameplates TYPE PACE x RANGE ROVER - es EW DEFENDER DISCOVERY. : O-berevealed.this REFRESHED XE 23
Slide 24: I-PACE takes World Car of the Year
Improving |-PACE takes World Car of the Year triple crown And European Car of the Year ore Jaguar | Pace Sales by quarter
Slide 25: All-new Range Rover Evoque now on sale
Improving sales All-new Range Rover Evoque now on sale Launch schedule March 2019 April 2019 August 2019 UK & Europe North America & Overseas China All-new RR Evoquesales by month Janis Feb-19 Mar-19 Apr-19
Slide 26: All-new Land Rover Defender
Improving Se All-new Land Rover Defender To be revealed later this year TR I Th > les 26
Slide 27: New models, replacements and refreshes
2011 New 2012 New 2013 New New 2014 New 2015 New New Refresh Refresh 2016 New 2017 New Refresh New New Refresh Refresh 2018 New 2019 Refresh New New 2020-24 New models, replacement models and mid-cycle refreshes to be announced
Slide 28: Market update: China and the US
MARKET UPDATE —- CHINA AND THE US
Slide 29: +17.6% +9.1% +5.0% +3.0% +3.3% +13.0% -4.8% -5.6% -11.4% -20.9% Q.1 Q.2 Q.3 Q.4
+17.6% +9.1% +5.0% +3.0% +3.3% +13.0% -4.8% -5.6% -11.4% -20.9% Q.1 Q.2 Q.3 Q.4 Q.1 -12.6% -14.7% -15.1% -15.5% -15.7% Q.1 Q.2 Q.3 Q.4 Q.1
Slide 30: JLR China operational KPIs stabilising
Improving sales JLR China operational KPls stabilising Retail Target Achievement% 94% target 190% Local Registration Rate in % (provincial level) e----" 87% Target 30% LL ° eee 70% ee 62% e eo 7, e 81% Jul’ 18 €2018 | 20199 End ‘19 Jul'18 €2018 20199 End ‘19 Retailers’ Return on Sales (ROS) in % Ret
Slide 31: US market conditions remain favourable
Improving sales US Market conditions remain favourable Large, stable premium market with shift to SUVs and trucks continuing TIV - Premium vs. Non Premium Forecast for eae a slight decline with premium share 20m 7 76 v5 "3 169 remaining steady > . a . 15m ~ Premium sales forecast at c. 2 million per
Slide 32: JLR US Performance
Improving sales JLR US Performance Significant growth driven by new models and industry trends Jaguar 18/19 Sales Land Rover 18/19 Sales Jaguar, 33k Land Rover, 95k Jaguar Land Rover JLR US Retail 1,40,000 415377 1255581 1,20,000 cose mors? 1,00,000 : 80,000 60,000 ) T4AN 40,000 20,000 - 15,127 FY 1
Slide 33: JLR well positioned in the US (Transaction Price)
Improving sales JLR well positioned in the US (Transaction Price) Solid LR returns with pricing and incentives better than industry 4D. Foe ae raring Transaction Price JLR transaction price remains higher than industry average $80,000 o— + Land Rover reflecting continued success of RR, RR Sport and
Slide 34: JLR well positioned in the US (retail network)
Improving sales JLR well positioned in the US (retail network) Common retailer identity with ARCH; $1.5b invested by dealers + Well-established retailer network, solidly profitable on average * Land Rover franchise is most profitable in industry * New common corporate identity (ARCH) being implement
Slide 35: Project Charge and Accelerate Update
Slide 36: Project Charge ahead of target
Project Charge ahead of target First £1.3b of £2.5b target achieved in FY19 Area Target FY19 % Complete Areas focused so far FY20 £b £b Time 33.3% (since launch in Sept 18) (Bal; £b) + £700m savings in FY19 vs £4.5b initial guidance, better Investment 10 07 70% ne mn(Salsohn Gieig)a gst 203 @ ¢ Prim
Slide 37: Project Charge: FY20 focus on cost and margin
Project Charge - FY20 focus on cost and margin improvement. And incremental investment and working capital improvements JAGUAR Remaining target to achieve 4 Focus on achieving sustainable savings beyond FY20 Further opportunities to reduce non-product investment, non-core engineering spend, and prod
Slide 38: Transitioning from Charge to Accelerate
Long term sustainable business Transitioning from Charge to Accelerate Building a more robust business for the Long term SS Immediate focus on fel> >>] financial position 7 fundamental challenges 7 Py 2 Improve financial performance & ry y & Reduce delays and improve > Improve EBIT quality > Reduce
Slide 39: Looking ahead: our plans
Looking ahead —_ Our plans meses Key metrics FY20-21 FY22-23 Beyond Retail sales growth > Premium Segment > Premium Segment > Premium Segment EBIT margin 3-4% 4-6% 7-9% PBT Positive Positive Positive Investment spending Up to £4b Up to £4b 11-13% of revenue Free cash flow Negative, improving Positiv
Slide 40: 3 & 4: Tata Motors (Standalone)
3 & 4: Tata Motors (Standalone) TATA MOTORS TATA MOTORS Connecting Aspirations Guenter Butschek, PB Balaji
Slide 41: Turnaround 2.0
TATA MOTORS Turnaround 2.0
Slide 42: Tata Motors Standalone Q4 FY'19 & FY19
Q4FY'19 & FYI Revenue 269.2K Cr (+20.3%), EBIT 2.6KCr (3.8% of Revenue) “Turnaround 2.0” delivers in challenging conditions TATA MOTORS =Cr. Q4 FY'18 Q4 FY'19 Change =Cr. FY'18 FY'19 Change Volume (units) 201,571 193,923 (3.8%) Volume (units) 636,968 732,428 15.0% Revenue 19,173 18,561 (3.2%) Revenu
Slide 43: FY'19 PBT higher, EBIT up
FY'19 PBT higher by = 3.3K Cr, EBIT up 330 bps Operating leverage continues to deliver TATA MOTORS Connecting Aspirations Savings from ImpACT Projects(+220 bps) Cr. IndAS Dividend & Divestments 826 Non-recurrence of Fit for Future charges 821 Employee (306) Others 101 717 2142 (891) 1 (205) (947) PB
Slide 44: Q4 FY'19 PBT higher
Q4 FY'19 PBT higher by = 0.7K Cr, EBIT up 60 bps led by ; TATA MOTORS Non recurrence of one off charges; offset by negative operating leverage Connecting Aspirations Non-recurrence of Fit for £ Cr Inds Future charges 821 Profit on divestment 333 Dividend & Others (486) FME (62) Others incl D&A (31)
Slide 45: Free Cash Flows of 1.5K Cr
FY'19 Free Cash Flows of 2 1.5K Cr Second consecutive year of positive free cash flows TATA MOTORS Connecting Aspirations 293 = Cr. IndAS (es) (182) (4,753) '5)(eIs}s) PBT FY19 Non-cash Tax Cash profit Investment and other after tax Q4FY19_ PBT 266 1,159 (141) 1,284 (1,596) * Free cash flow is measu
Slide 46: Investment Spending 7.7% of Revenue
FY'19 Investment Spending 7.7% of Revenue ATA MOTORS . . . lalal In Iration: BS VI investments and new product investments drive up spends (BSVI :c1.5%) = Cr. IndAS = Products 18% = Powertrain = Electrification Sustenance 1,993 Capitalised Expensed Total Capital & Other Total Investment R&D R&D R&D
Slide 47: CV: Wholesales and Retails growth
FY'19 CV - Wholesales (Dom) +17.2%; Retails (Dom.) +22.6% . mas: n a TATA MOTORS Aim to “Win Decisively” by driving all round execution Connecting Aspirations +15.6 +22.6% * Q4 growth impacted by liquidity stress , higher capacity in = market due to axle load changes and slowing economy. i 2 gE ti .
Slide 48: CV: Broad based growth across the portfolio
FY'19 CV: Broad based growth across the portfolio Market Share gain in 3 out of 4 segments TATA MOTORS Connecting Aspirations Market Share CV Units in 000 151 é 134 Be 8 8 8 S28 Up 12% eg Fe pereeee ete ee & Ft kt FYI8——FY19 55% Market share FY'19 +70 bps The figures exclude export volumes ILCV truc
Slide 49: CV: Revenue growth +20.4%, EBIT at 8.2%
FY19 . 0 Lt) CV: Revenue growth +20.4%, EBIT at 8.2% 7 TATA MOTORS EBITDA stable, while EBIT improved in challenging market conditions Connecting Aspirations Cr. IndAS Revenue EBITDA Margins EBIT and EBIT margin Growth : 20.4% EBIT EBIT 7.8% 8.2% EBITDA 4,431 11% 3,508 44,876 54,037 FY FY'19 FY'19 F
Slide 50: Volume growth ahead of industry
Volume growth ahead of industry • • Market shares improvement continues • • • • • • 50
Slide 51: Tata Harrier on sale
Tata Harrier on sale TATA MOTORS Great reception and strong demand Connecting Aspirations Order book c. 2 months order cover
Slide 52: PV: Revenue growth +10.3%, EBITDA breakeven achieved
FY19, PV - Revenue growth +10.3% , EBITDA breakeven achieved . . . = TATA MOTORS Turnaround 2.0 delivers in challenging market conditions Connecting Aspirations Cr. IndAS Revenue EBITDA Margins EBIT and EBIT margin Growth : +10.3% 13,645 FY'18 FY'19 Ee EBITDA 0.1% EBIT EBITDA (11.4%) (9.3%) EBIT (22
Slide 53: Turnaround 2.0: Our approach
Turnaround 2.0 — Our approach TATA MOTORS Connecting Aspirations Turnaround 2.0 CB) ene Ons ED) spy crs nt ‘hlcercies [ale] = = 5 _\ tts time to deliver xin Sy Win Decisively in CV Win Sustainably in PV Win Proactively in EV BROWN > Embed turnaround into culture Volume growth ahead of industry ‘Stre
Slide 54: CV PV
• • 37% • 19% 7% 2% -3% -3% -3% 0% -2% -1% -2% -6% CV PV 54
Slide 55: Industry disruption continues
Additionally the disruption in the industry continues TATA MOTORS Connecting Aspirations Autonomous Connected Adapting global NCAP stds Vehicle communication Active & passive safety Comfort & Convenience MaaS (Mobility as a Service) Electric xEVs, alternative fuels Powertrain investments Ecosystem d
Slide 56: Our response: defined angles of attack
Our response — 5 defined angles of attack TATA MOTORS Connecting Aspirations Digital Technology Product Cost Scale Design to global standards with Impact 2.0 Drive scale & efficiencies through modularity, commonality & volume growth Faster, better and cost effective products by leveraging new archit
Slide 57: This will help us realise our vision
This will help us realise our vision Delivering superior financial returns Exceeding customer expectations in By FY2024, we will become the most aspirational Indian auto brand, consistently winning, by: TATA MOTORS Driving sustainable mobility solutions Ce) Creating a highly engaged workforce © — Ei
Slide 58: 5. Tata Motors Finance
TATA MOTOR 5. Tata Motors Finance OTORS | What are you Looking for? oo cy wl debt & others 2.JLR China PB Balaji
Slide 59: Tata Motors Finance: AUM grows strongly
FY 19 Tata Motors Finance: AUM grows strongly to = 38K Cr (+37%); TATA MOTORS GNPA declines further to 2.6% IndAS FY18 FY19 vs '18 Market Share 24.9 26.2 130 bps PBT 31 123 302% ROE 8.4% 12.0% 360 bps AUM 27,932 38,311 37% GNPA% 4.0 2.6 139 Bps NNPA % 27 14 138 bps Further details of IGAAP, IndAS re
Slide 60: 6. Net Debt and Others
6. Net Debt and Others TATA MOTORS Ga ~ b> ae =~ = w PB Balaji
Slide 61: Debt Profile
Debt Profile TATA MOTORS Maturities well spread out & Adequate Liquidity Debt maturity profile ‘PSE TML (S) Debt maturity profile 5710 fa a” DebVEBITDA 55 1 e H om ~ [| OO tes on ee wna my a a -_ 3,632 RCF us shor ps0 Term 1 384 284 300 400 me sa) as 385 oe 20m “1283 (lag | ene" ow "eat "owt ems" en
Slide 62: Tata Motors Group - Outlook
Tata Motors Group - Outlook PB Balaji
Slide 63: Automotive Industry continues to be challenging
Automotive Industry continues to be challenging TATA MOTORS Global and market-specific challenges continue 9 Challenges ] Challenges 9 * Continued Macro headwinds Challenges . a Challenges + Lower consumer confidence * High Incentives * Diesel uncertainty eto! WIA TAY Slowing economy + Tariff risks
Slide 64: Looking ahead: Our plans
Looking ahead — Our plans TATA MOTORS Jaguar Land Rover Key metrics FY20-21 FY22-23 Beyond Retail sales > Premium > Premium > Premium growth Segment Segment Segment EBIT margin 3-4% 4-6% 7-9% FCF Negative, Positive Positive Improving * Q1FY20 profit & cash flows to reflect historical seasonality and
Slide 65: Investor Relations Note
Investor Relations Note TATA MOTORS Thank You Gunter Butschek CEO and MD, Tata Motors P. B. Balaji CFO, Tata Motors Group Vijay Somaiya Treasurer, Tata Motors Tata Motors Investor Relations ir_tml@tatamotors.com Ralf D. Speth CEO, Jaguar Land Rover Kenneth Gregor CFO, Jaguar Land Rover Bennett Birgb