Onward Technologies Limited · NSE:ONWARDTEC
Onward Technologies — Investor Presentation (July 2023)
33 slides from Onward Technologies's investor presentation, Jul 20, 2023
Slide 1: Submission of Investor Presentation July 2023
Date: July 20, 2023 To, BSE Limited National Stock Exchange of India Ltd., Corporate Relations Department Exchange Plaza, 5th Floor, P J Towers, Dalal Street Plot No. C/1, G Block, Mumbai 400 001 Bandra-Kurla Complex, Bandra (East), Mumbai – 400 051. Ref: Scrip Code - BSE: 517536 NSE: ONWARDTEC Sub:
Slide 2: Investor Presentation July 2023
INVESTOR PRESENTATION J U LY 2 0 2 3 www.onwardgroup.com
Slide 3: Disclaimer
Disclaimer This release may contain certain future prospects, which may be forward-looking statements. Forward-looking statements, by their nature, involve a number of risks and uncertainties that could cause actual results to differ materially from market expectations. These forward-looking stateme
Slide 4: Agenda
Agenda Onward Technologies – A Snapshot 1 Transformational Path to a Digital ER&D Business 2 Company Overview 3 Case Studies 4 Financial Performance 5 Outlook 6
Slide 5: Onward Technologies – A Snapshot
Onward Technologies – A Snapshot
Slide 6: Company at Glance
Company at Glance Onward Technologies is a Software Outsourcing Company Specializing in Digital and ER&D Services Global 2,000 8/11 5/10 2,798 Customers Global Top Automotive Global Top Industrial Employees Players Equipment Manufacturers ₹441 Cr 13 5 Highest Ever Revenue In Offices In 6 Countries O
Slide 7: Transformational Path to a Digital-Focused Business
Transformational Path to a Digital-Focused Business 1991-2015 2016-2022 2023 onwards ❑ Incorporated in August 1991 in Mumbai ❑ Mr. Jigar Mehta appointed as Managing ❑ Transitioning from low-margin legacy by Mr. Harish Mehta, a first-generation Director business to higher-margin offshore and entrepre
Slide 8: Transformational Path to a Digital ER&D Business
Transformational Path to a Digital ER&D Business
Slide 9: What has changed?
What has changed? Change in business mix from Legacy to New Legacy Business New Business Revenue Mix ❑ Focus on Mechanical engineering in Indian and ❑ Transitioning IT services clients to Digital services Global markets along with IT support services to with focus on Digital and ER&D business Indian
Slide 10: Investments in Business While Attracting Human Capital
Investments in Business …While attracting Human Building Costs Capital Powering the transformation 2,798 Expenses (in ₹ Crore) 3.8 2,557 2,641 2,491 2,497 257 169 186 171 97 418 463 84 95 26 2,088 1.7 167 330 2,291 93 1.7 1.5 17 2,221 2,231 2,078 1.7 1,893 10 10 10 1,828 2.1 7 3 3 FY18 FY19 FY20 FY2
Slide 11: Leading to Gross Margin Movement
Leading to Gross Margin Movement Reflecting Change in Business Mix 33% 35% 32% 28% 16% 17% 16% 15% 17% 14% FY18 FY19 FY20 FY21 FY22 FY23 Legacy Business Gross Margin New Business Gross Margin On the back of continued investments and exits from legacy projects, the momentum toward a higher margin is
Slide 12: Company Overview
TECHNOLOGIES Company Overvi
Slide 13: Diversified Business Lines
Diversified DiversifiedBusiness BusinessLines Lines Embedded & Electronics Mechanical Engineering Digital Services IT Services Engineering Services Services ❑ Platform services ❑ New product design & ❑ Engineering ❑ SW Development & hardware, software development automation Maintenance ❑ Connectivit
Slide 14: Expertise Snapshot: Industrial Equipment & Heavy Machinery
Industrial Equipment & Heavy Machinery Heavy Equipment & Machinery Mining % of Revenue (FY23) 55% Expertise Snapshot % of Revenue (Q4FY23) 56% Engineering Services Overview Deliver equipment design and development solutions for Digital Transformation Industrial Equipment Manufacturers 14
Slide 15: Expertise Snapshot: Transportation & Mobility
Transportation & Mobility Automotive Rail Transportation % of Revenue (FY23) 31% Digital & IT Services Expertise Snapshot % of Revenue (Q4FY23) 31% Embedded Electronics & Overview Mechanical product engineering, Software Development Embedded design, testing and digital transformations services to bo
Slide 16: Expertise Snapshot: Healthcare & MedTech
Healthcare & MedTech Medical Devices Pharma Product Development % of Revenue (FY23) 8% and Sustaining Expertise Snapshot % of Revenue (Q4FY23) 9% Manufacturing Engineering & Quality Overview Verticals serviced include pharma, life sciences, healthcare, Regulatory and medical equipment Compliance & C
Slide 17: Strategic Presence Across Geographies
Strategic Presence Across Geographies Toronto Mumbai (Corporate HQ) Pune London Amsterdam Chicago Detroit Frankfurt Hyderabad Chennai Bengaluru 16
Slide 18: How does Onward Technologies differentiate themselves?
How does Onward Technologies differentiate themselves? Right Sized Partnerships 1 ❑ Provide dedicated teams to drive execution and attention to ensure client-centricity, unlike large service companies Agility ❑ Delivery model enables quick ramp-up of technical teams through talent acceleration progr
Slide 19: Case Studies
TECHNOLOGIES Case Studies
Slide 20: Key Wins
Key Wins Industrial Equipment & Heavy Machinery Transportation & Mobility Healthcare & MedTech ▪ Manufacturer in Industrial ▪ Automotive manufacturer, part ▪ Healthcare client Equipment & Heavy Machinery of a top-3 European OEM ▪ Developing a web application that ▪ Developing software, carrying out
Slide 21: Case Study 1: Fleet Management for a Large Off-Highway OEM
Case Study 1 Fleet Management for a Large Off-Highway OEM Business Challenges Key advantages Solutions Provided Tools Used ROI ❑ Validation of 40+ Platform ❑ Quality deliverables with ❑ SIT plan and strategy with ❑ MS Azure Dev Ops ❑ Improved ‘on-time delivery’ API changing micro batch all required
Slide 22: Case Study 2: AC Motor Development and Control
Case Study 2 AC Motor Development and Control for Hybrid, Electric and Fuel-Cell Vehicles Design and development of various AC motors and controls used for e-boosters and traction control applications for a European EV systems manufacturer Business Challenges Benefits Solutions Provided ❑ Sensor-les
Slide 23: Success Stories in Healthcare
Success Stories in Healthcare Re-engineering and redesign of hospital Sustenance engineering for diagnostic Design support for automatic medical bed imaging equipment syringe assembly machine Value engineering for lab REACH (Registration, evaluation, authorisation and NPD (New Product Development)su
Slide 24: Financial Performance
TECHNOLOGIES Financial Perfor
Slide 25: Consolidated Financial Summary – Q4FY23
Consolidated Financial Summary – Q4FY23 (Figures In ₹ Crore) Revenue from Operations EBITDA & EBITDA % PBT & PBT % PAT & PAT % 10.0% 6.0% 11.6% 7.2% 5.7% 5.7% 3.7% 3.3% 2.1% 87.5 115.8 121.4 6.3 6.6 14.1 5.0 3.8 12.2 3.2 2.5 7.2 Q4 FY22 Q3 FY23 Q4 FY23 Q4 FY22 Q3 FY23 Q4 FY23 Q4 FY22 Q3 FY23 Q4 FY23
Slide 26: Revenue Metrics
Revenue Metrics Revenue by Industry Revenue by Business Revenue by Geography 6% 11% 13% 12% 13% 26% 19% 8% 21% 26% 17% 7% 2% 8% 36% 33% 39% 8% 31% 30% 24% 72% 71% 70% 55% 53% 54% 49% 42% 44% FY21 FY22 FY23 FY21 FY22 FY23 FY21 FY22 FY23 Others ER&D Digital ITS India USA Europe Healthcare Transportati
Slide 27: Revenue Metrics
Revenue Metrics Revenue by Contract Type Revenue by Engagement Model Revenue by Client 12% 25% 26% 30% 30% 28% 81% 88% 66% 62% 75% 74% 70% 70% 72% 58% 45% 44% 43% 31% 31% FY21 FY22 FY23 FY21 FY22 FY23 FY21 FY22 FY23 Time & Material Fixed Time & Price Onsite Offshore Top 5 Top 10 Top 25 26
Slide 28: Operating Metrics
Operating Metrics Clients with Annual Billing >USD 1mn Total Headcount Days Sales Outstanding (DSO)* 88 87 15 2,641 2,798 77 11 2,088 6 FY21 FY22 FY23 FY21 FY22 FY23 FY21 FY22 FY23 * DSO includes billed and unbilled 27
Slide 29: Key Performing Indicators
Key Performing Indicators Particulars (In ₹ Crore) FY21 FY22 FY23 Reasons Revenue growth was mainly led by a rise in outsourcing by top Revenue from Operations 240.4 307.3 440.9 clients along with increase in wallet share from existing strategic clients on the back of strong demand Other Income 5.3
Slide 30: Outlook
TECHNOLOGIES Outlook
Slide 31: Future Outlook
Future Outlook ❑ Aspiration to reach US$ 100 mn revenue by organically mining strategic accounts. Any bolt-on Revenue (in $ Mn) inorganic opportunity will be an added bonus $ 100 Mn ❑ Levers to achieve mid-teens EBITDA margin target by FY26 - Initial Investments in TAP have started bearing fruits, g
Slide 32: Investment Rationale
Investment Rationale Trusted Outsourcing Partner Focused on top 25 customers with higher outsourcing budgets, and the potential to make investments in long-term projects Vertical Expansion Industrial Equipment & Heavy Machinery driving growth for the company, followed by Transportation & Mobility. H
Slide 33: Thank you
Thank you For Further Information, Please Contact: Asha Gupta asha.gupta@in.ey.com Anushka Khanna anushka.khanna@in.ey.com Pratik Jagtap pratik.jagtap@in.ey.com
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