Eicher Motors Limited · NSE:EICHERMOT
Eicher Motors — Investor Presentation (February 2022)
71 slides from Eicher Motors's investor presentation, Feb 14, 2022
Slide 1: Regulation 30 Investor Presentation Intimation to Exchanges
February 14, 2022 Online intimation/submission The Secretary The Secretary BSE Limited National Stock Exchange of India Ltd Phiroze Jeejeebhoy Towers Exchange Plaza, 5th Floor, Plot No.C/1, Dalal Street G Block, Bandra Kurla Complex, Bandra (E) Mumbai‐400 001 Mumbai‐400 051 Security Code: 505200 Sym
Slide 2: Investor Presentation February 2022
5/20/2020 Investor Presentation a February 2022
Slide 3: Contents
Contents 1 EICHER MOTORS LIMITED – OVERVIEW 2 ROYAL ENFIELD 3 VE COMMERCIAL VEHICLES LIMITED 4 ESG 5 FINANCIALS Note: The Company followed “January-December” as its reporting year till December 2014. The Board of Directors in its meeting held on February 13, 2015 decided to align the reporting year
Slide 4: Eicher Motors Limited
Eicher Motors Limited INVESTOR PRESENTATION February 2022 3
Slide 5: Eicher Motors Ltd. (EML) - Group Structure
Eicher Motors Ltd. (EML) - Group Structure Promoter Group Domestic Foreign Institutional Others Institutional Investors Investors 49.22% 29.45% 9.73% 11.60% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Eicher Motors Limited (EML) Volvo Group Business Unit 45.6% 54.4% Royal Enfield (RE) VE Commercial
Slide 6: Royal Enfield
INVESTOR PRESENTATION February 2022 5
Slide 7: Global leader in the middleweight motorcycle segment
Global leader in the middleweight motorcycle segment; Poised to become the first premium global consumer brand from India Royal Enfield is the global leader in the 250cc – 750cc, mid-segment motorcycles. With ~90% market share in the Indian mid-size segment, we have rapidly grown our presence across
Slide 8: Launch of the Classic in 2009 was an inflection point
Launch of the Classic in 2009 was an inflection point Volumes grew by ~40% CAGR between CY-2010 to FY-2018, prior to significant external headwinds Replacement opportunity While FY2020-21 volumes were impacted due to awaits as most of the sales COVID-19, our new models including Meteor 350 happened
Slide 9: Significant Value Creation for all stakeholders
Significant Value Creation for all stakeholders Market Capitalisation (INR Billions) 123x returns over last 13 years Source: Capital IQ Excluding dividends INVESTOR PRESENTATION February 2022 8
Slide 10: Global
Global INVESTOR PRESENTATION February 2022 9
Slide 11: Opportunity – Domestic Market
Opportunity – Domestic Market India to become a US$6.5 trillion economy by 2030 India’s favorable demographics By 2031, the working age population i.e. 20-59 years is poised Indian Economy: A shift to a high growth path to increase by 300bps US$ 6.5 Tn US$ 2.6 Tn Source: Economic Survey 2019-20 Risi
Slide 12: Established Premium Brand in India with an expansive premium distribution network
Established Premium Brand in India with an expansive premium distribution network 1,065 stores and 1,053 studio stores across ~1,750 cities Dealer Network Store count ▪ Large stores ▪ Studio stores rs North yea n6 338 | 372 4x i East 199 | 229 West City Category wise Distribution 216 | 177 Category*
Slide 13: Global mid-size motorcycle market is underserved and is a huge opportunity
Global mid-size motorcycle market is underserved and is a huge opportunity The Oddity of the Motorcycle Industry Globally… is an opportunity CAGR:2012-18 Most Developing Motorcycles > 750cc Industries Markets -2% Industry 250-750cc 3% Premium RE is driving upgrade along -2% Mid with premiumisation i
Slide 14: Established brand with profitable business model backed by premium quality product
Established brand with profitable business model backed by premium quality product BRAND PRODUCT NETWORK ▪ Strong brand ▪ Strong pipeline of new ▪ Focused approach for salience coupled with products for next international markets equity as a premium 5-years and beyond for expansion and desirable bra
Slide 15: Building capabilities to cater to global audience
Building capabilities to cater to global audience Bruntingthorpe, UK New Product Chennai, India Introduction (NPI) In English midlands framework in place to with access to global product development develop best-in-class capabilities and products in an ecosystem World-class optimal timeframe facilit
Slide 16: Rapidly growing international network
Rapidly growing international network 156 Exclusive stores opened in less than 6 years; 660+ MBO Developed Markets Developing Markets Multi Multi Exclusive Exclusive Brand Brand Store Store Outlet Outlet North APAC 49 95 1 138 America Countries with exclusive stores ▪ Australia* – 1 ▪ New Zealand* –
Slide 17: Share of revenue from international markets has grown 3x over the last 5 years
Share of revenue from international markets has grown 3x over the last 5 years Network Expansion and Touch Points New Retail formats - Studio stores, Shop-in-shop for International Business – apparel, and motorcycle Stellar Financial Performance over last 5 years displays to increase customer reach.
Slide 18: Motorcycling
Motorcycling INVESTOR PRESENTATION February 2022 17
Slide 19: Product Portfolio – Continue to focus on mid-weight segment
Product Portfolio – Continue to focus on mid-weight segment Royal Enfield range of motorcycles is able to address a unique mix of appeals – from its traditional customer base to urban, aspiration-driven youth Continental Interceptor Bullet 350 Classic 350 Meteor 350 Himalayan GT 650 650 ▪ Oldest bra
Slide 20: All-new Classic 350: Setting New Benchmarks
All-new Classic 350: Setting New Benchmarks Positive Adoption and Extended with a host of 100,000th unit rolled out Engagement by Customers Accessories Range ▪ Gained customer appreciation ▪ The all-new Classic 350, ▪ A wide array of 35 bespoke on Retro look, availability of since its debut in India
Slide 21: Best-in-Class Technology Delivering Superior Quality
Best-in-Class Technology Delivering Superior Quality VEHICLE ASSEMBLY ENGINE ASSEMBLY SURFACE FINISHING ▪ SRK methodology for new products ▪ Automated critical sub-assemblies ▪ Best-in-class European technology ▪ Flexibility - Over 500 SKUs in 5 lines ▪ First-time right with 400 Poka Yokes ▪ 46 pain
Slide 22: The Customer at the centre
The Customer at the centre SALES SERVICE PRODUCT Field Failure – Defects per Hundred Bike 5X Re du DPHB ction 2016 2017 2018 2019 2020 2021 Store and Online experience Service on Wheels Product Quality Excellence ▪ Sales Process excellence ▪ First time right ▪Vallam Vadagal facility received "Challe
Slide 23: Variety of initiatives to enhance customer experience
Variety of initiatives to enhance customer experience Studio Stores Royal Enfield Vintage Make It Yours - a unique Unique compact store format Transparent sale and purchase of motorcycle personalization with 3S store offerings pre-owned RE motorcycles initiative Royal Enfield Garage RE App Royal Enf
Slide 24: Rides and Community
Rides and Community Continental GT Cup One Ride ▪ Debut of the Royal Enfield Continental GT Cup 2021 ▪ The 10th edition of One Ride was organised across - a unique retro track-racing initiative, aspiring to 35 countries on 26th September 2021, with strict further nurture niche riding cultures and op
Slide 25: 90° South: Our Quest for the South Pole
90° South: Our Quest for the South Pole A tribute to the brand’s Successfully completed 90° A 28-day journey traversing commitment to pure South - A first-of-its-kind Antarctica on a 400 km ride motorcycling, and to the courage motorcycle expedition to from 87° South to the South and resilience of e
Slide 26: Building the Pure Motorcycling Ecosystem
Building the Pure Motorcycling Ecosystem Provide frictionless experience for RE Riders Explore new revenue / profit pool from adjacencies In Store Opportunity In Use Opportunity Road Side Spares Assistance Annual Maintenance Extended Contract Warranty Accessories Apparel Solutions Business - Financi
Slide 27: Product Portfolio – Apparel
Product Portfolio – Apparel ART OF MOTORCYCLING SEASON 2 Everything that has defined the brand over the past 120 Conceptualized a platform catering artists, designers, years of our existence, now expressed in 12 limited edition illustrators and motorcycle enthusiasts to exhibit their love hand craft
Slide 28: Brand
Brand INVESTOR PRESENTATION February 2022 27
Slide 29: EICMA 2021
EICMA 2021 SG 650 LIMITED EDITION 120 PROJECT ORIGIN YEAR TWINS Opened at EICMA 2021 with an Debuted the 120th Year Anniversary Edition with the Showcased a major centre-piece unveiling of the Royal Enfield flagship models; the 650 Twin, the Interceptor 650 and of our 120 anniversary celebration SG6
Slide 30: Oldest Motorcycle Brand in Continuous Production
Oldest Motorcycle Brand in Continuous Production INVESTOR PRESENTATION February 2022 29
Slide 31: Engage Physically... Propagate Digitally
Engage Physically... Propagate Digitally Himalayan Riders Club Rider Mania Odyssey Of Europe Slideschool One Ride Continental GT Cup 90° South The largest, fastest On-ground and growing and the Strong global digital on-line communities most engaged online ‘Digital First’ community with very together
Slide 32: Building a strong digital community
Building a strong digital community #90South Meteor Turned 1 All New Classic 350 #120YearsOfRoyalEnfield Average Total Reach* Total Engagement per Engagement 2,005 M Brand post 127 M 8,993 Engagement Total Views Rate^ Royal Enfield Podcasts 952 M 6.27% Royal Enfield x Belstaff Classic Guinness World Re
Slide 33: Hybrid Engagement Leading to Strong Consumer Equity
Hybrid Engagement Leading to Strong Consumer Equity #1 84% Consideration #1 50% Top of Mind Awareness 2,000 bps ahead of our closest competitor 2,400 bps ahead of our closest competitor *Internal Millward Brown Brand Health Report with sample size of ~3200) ▪ Among the host of brand health metrics t
Slide 34: Business Performance
Business Performance INVESTOR PRESENTATION February 2022 33
Slide 35: Consistent Delivery leading to strong cash accruals
Consistent Delivery leading to strong cash accruals All figures are in Rs. Crs unless specified Total Revenue EBITDA and Margin Total revenue from operations (net of excise duty) Profit After Tax Net Cash Net Cash = Cash and cash equivalent – Total debt Note: PAT for FY18 and FY19 includes an impair
Slide 36: YTD FY22 Highlights - Eicher Motors Ltd. (Standalone)
YTD FY22 Highlights - Eicher Motors Ltd. (Standalone) All figures are in Rs. Crs unless specified Sales Volume Market Share* (India) Total Revenue (in Thousands) Total revenue from operations (net of excise duty) 2.2% 21.6% EBITDA and Margin Profit After Tax Net Cash 18.9% 19.9% * Market Share in ab
Slide 37: Strong steps taken to mitigate short term supply chain challenges
Strong steps taken to mitigate short term supply chain challenges Challenge Mitigation Semiconductor Component Working closely with Shortage - parts and electronic Acute shortages of electronic component suppliers to components (ICs, ensure accurate microprocessors, etc.) globally forecast of compon
Slide 38: Multiple Management Actions Taken to Optimize Cost Base
Multiple Management Actions Taken to Optimize Cost Base Business Material Employee Fixed Marketing Top Line Cost Cost Overheads Spend Selling Price Material Cost People Cost ▪ Restricted travel ▪ Sharper Digital reset actions: control initiatives: Initiatives: & training marketing ▪ Initiated quarte
Slide 39: Awards and Achievements
Awards and Achievements Meteor 350 won MCN’s ‘Best Retro Bike of the Year’ Award 2021(UK) and ‘Best modern Royal Enfield’s Vallam Vadagal facility classic over 250cc’ Award at the Thailand Bike receives the ‘Frost and Sullivan Gold’ Award of the Year Awards 2021 in addition to awards for Manufacturi
Slide 40: RE in Summary
RE in Summary Poised to become the first premium global consumer brand from India Strong Brand Best-in-Class Extensive Non Products Network Motorcycle Solution Processes and systems People Sustainability: ESG INVESTOR PRESENTATION February 2022 39
Slide 41: VE Commercial Vehicles
INVESTOR PRESENTATION February 2022 40
Slide 42: What drives us….Vision & Values
What drives us….Vision & Values Respect To be recognised as Fair and Ethical the industry leader driving modernization Excellence in commercial transportation in Customer Centric India and the Passion developing world INVESTOR PRESENTATION February 2022 41
Slide 43: Businesses…Eicher Trucks and Buses, Volvo Trucks & Buses in India, Drivelines and Components
Businesses…Eicher Trucks and Buses, Volvo Trucks & Buses in India, Drivelines and Components Eicher Trucks VECV Bus Division Engines & Drivetrain Engineering Components Volvo Trucks INVESTOR PRESENTATION February 2022 42
Slide 44: Joint Venture since 2008… Merging the best of both worlds
Joint Venture since 2008… Merging the best of both worlds ▪ Global expertise ▪ Leadership in Light & Medium Duty ▪ Leadership in product technology segments ▪ Well defined processes and ▪ Frugal engineering & operations controls ▪ After sales infrastructure ▪ Brand image ▪ Cost effective operations
Slide 45: VECV JV Capability and Market Position strengthened over past 13 years
VECV JV Capability and Market Position strengthened over past 13 years… Successful synergies based on trust, mutual respect & win-win 2008-2013 2013-2020 2021 > JV formation and initial Wave 2 Synergy Next step synergies Synergy projects -Commercial focus ▪ Product development ▪ Launched Eicher Pro
Slide 46: Strengthened market share in all segments with modernisation
Strengthened market share in all segments with modernisation Light & Medium Duty Trucks Heavy Duty Trucks 30.1% 6.9% 25.3% 1.3% FY 2009 FY 2021 FY 2009 FY 2021 Buses 19.7% Volvo Trucks India* 88.1% 5.3% 72.6% FY 2009 FY 2021 FY 2009 FY 2021 *Market share in high end premium segment INVESTOR PRESENTA
Slide 47: Consistent financial performance despite headwinds
Consistent financial performance despite headwinds All figures are in Rs. Crs unless specified Total CV# Volumes and Total Revenue Total revenue from operations (net of excise duty) Market Share (in nos and %) EBITDA^ and Margins Profit After Tax CV# - Commercial Vehicles EBITDA – Earning Before Int
Slide 48: YTD Financial Highlights - VE Commercial Highlights
YTD Financial Highlights - VE Commercial Highlights All figures are in Rs. Crs unless specified Total Revenue Total revenue from operations 65.9% EBITDA^ and Margins Profit After Tax 58.2% EBITDA – Earning Before Interest ,Tax, Depreciation and Amortisation ^For the purpose of EBITDA computation, on
Slide 49: Eicher BSVI Product Portfolio…Renewed range
Eicher BSVI Product Portfolio…Renewed range. Broad application segment coverage Sub 5T – 16T ANGE 4.9T to 16T Haulage LMD R 2.8CuM to 6.5CuM Tippers 18.5T to 55T NGE 18.5T to 47.5T Haulage HD RA 7 CuM to 32 CuM Tippers/ Tip Trailers 39.5T to 55T Tractor Pro 6019T Pro 6028T/TM Trailers Pro 6035T 12 –
Slide 50: VECV Bus Division…Shaping the future of Indian Bus Industry
VECV Bus Division…Shaping the future of Indian Bus Industry Volvo Buses + Eicher Buses Distinct Comprehensive Offer New Markets & E-Mobility Eicher & Volvo Brands Transferred Volvo Buses India operations and people into VECV in 2020 to create an industry leader INVESTOR PRESENTATION February 2022 49
Slide 51: Eicher Establishes New Standard In Inter-city Luxury Bus Travel
Eicher Establishes New Standard In Inter-city Luxury Bus Travel With New Coach & Sleeper Platform INVESTOR PRESENTATION February 2022
Slide 52: Electric range… 9m bus for city application ready for commercialization
Electric range… 9m bus for city application ready for commercialization INVESTOR PRESENTATION February 2022 51
Slide 53: Volvo Trucks India Introduced Next Generation Trucks
Volvo Trucks India Introduced Next Generation Trucks New Range of Volvo FM and FMX trucks introduced catering to the mining, construction & infrastructure and on-road transportation segments INVESTOR PRESENTATION February 2022 52
Slide 54: Manufacturing… enhanced with Volvo buses and Industry 4.0 Bhopal plant
Manufacturing… enhanced with Volvo buses and Industry 4.0 Bhopal plant Vehicle Assembly plant - Bhopal Eicher Engineering Components – Unit I & II Truck Plant-Pithampur – Dewas Plant Truck Plant-Bhopal VE Powertrain – Pithampur Industrial Gear Box for Chassis Assembly Line - Bhopal Export (SEZ) – Pi
Slide 55: Strengthening distribution and service reach….#1 in Dealer Satisfaction
Strengthening distribution and service reach….#1 in Dealer Satisfaction #1 in Dealer Satisfaction* 600+ network count INVESTOR PRESENTATION February 2022 *Federation of Automobile Dealers Associations (FADA) Survey 2021 54
Slide 56: Leading in Digitization…driven by 100% connected vehicle fleet
Leading in Digitization…driven by 100% connected vehicle fleet Digital Digital Digital Customer Business Enterprise INVESTOR PRESENTATION February 2022 55
Slide 57: ESG
ESG INVESTOR PRESENTATION February 2022 56
Slide 58: Themes for Sustainability Journey
Themes for Sustainability Journey Environmental Social Governance ▪ Become water positive ▪ Ride for a cause ▪ Strategy, execution and ▪ Attain Carbon neutrality ▪ Disaster relief activities monitoring ▪ Work towards zero liquid discharge ▪ Village upgradation ▪ Risk management ▪ Eliminate utilisati
Slide 59: Sustainability Efforts Gather Steam
Sustainability Efforts Gather Steam DJSI Inclusion Sustainability 4.0 Award 2021 In November 2021, Eicher Motors Limited made its debut In December 2021, Royal Enfield (A Unit of Eicher Motors on Dow Jones Sustainability Index (DJSI) 2021 - Emerging Limited) was recognized with the "Challengers Awar
Slide 60: Greener Business Operations
Greener Business Operations Energy and Emissions Conservation, efficiency, renewable energy, reduced emissions Minimise emission in raw material extraction and Reduce production amount of waste to Material Water and Effluent landfill EML Recycled material and EML Rainwater Harvesting ZLD, SERVICES R
Slide 61: Passion with Responsibility
Passion with Responsibility India USA Europe Committed to drive an active agenda Committed to support the affected towards the sustainability and the communities during the pandemic environment at large ▪ India: Rs. 60 Crs were spent during COVID to support community. ▪ Debut on the Dow Jones Sustai
Slide 62: EML Board: Leaders with proven track record
EML Board: Leaders with proven track record S Sandilya Siddhartha Lal B. Govindarajan Chairman- Non-Executive Managing Director and Executive Director - Royal and Independent Director CEO, EML Enfield, Whole Time Director Vinod K. Aggarwal Inder Mohan Singh Manvi Sinha Non-Executive Director Indepen
Slide 63: Royal Enfield managed by seasoned professionals
Royal Enfield managed by seasoned professionals Siddhartha Lal B. Govindarajan Kaleeswaran Executive Director - Mark Wells Mohit Dhar Jayal Managing Director Arunachalam Chief Brand Officer Royal Enfield Chief of Design and CEO, EML Chief Financial Officer Sudhakar Simon Warburton Manhar Kapoor Raje
Slide 64: VECV Board…Proven track record of value delivery
VECV Board…Proven track record of value delivery Siddhartha Lal Jan Gurander Joachim Rosenberg Vinod Aggarwal Chairman of the Board Deputy CEO Volvo Group EVP Volvo Group Managing Director & MD Eicher Motors Ltd President Volvo Energy CEO VECV Philippe Divry Raul Rai Lila Poonawalla Inder Mohan Sing
Slide 65: VECV Management … Deep experience in Indian & Global CV industry
VECV Management … Deep experience in Indian & Global CV industry BK Bindiganavile Finance, Legal & Strategy, Brand & SVP Communication Audit Vinod Aggarwal Sudeep Dev MD & CEO SVP & CHRO Businesses Processes Rajesh Mishra Human Resources and IT CDO Volvo Trucks Eicher Trucks and Buses, VEPT Bus Divi
Slide 66: Strong Governance Principles
Strong Governance Principles EML and VECV are compliant with applicable regulations No related party suppliers Board Sub-committees at EML with majority representation by independent directors and at VECV with Non-Executives No delinquencies towards banks/ institutions Professional management at CXO
Slide 67: Financials
Financials INVESTOR PRESENTATION February 2022 66
Slide 68: Profit and Loss Statement (Consolidated)
Profit and Loss Statement (Consolidated) (In Rs. Cr.) Profit and Loss Account FY17 FY18 FY19 FY20 FY21 9MFY22 Sales Volume: Two Wheelers (Nos.) 666,135 820,121 822,724 697,582 609,403 413,349 Total revenue from operations (net of 7,033 8,965 9,797 9,154 8,720 7,105 excise) Manufacturing and other ex
Slide 69: Balance Sheet (Consolidated)
Balance Sheet (Consolidated) (In Rs. Cr.) Particulars FY17 FY18 FY19 FY20 FY21 H1FY22 Net Fixed Assets (including CWIP and 1,247 1,835 2, 324 2,690 2,748 2,803 Pre-operative Expenditure) Investments 4,987 5,581 4,923 5,749 3,902 5,691 Other Non Current Assets 260 186 180 102 125 238 Current Assets I
Slide 70: Glossary
Glossary ▪ CAGR – Compounded Annual Growth Rate ▪ LCV – Light Commercial Vehicles ▪ Consolidated – Consolidated includes financials of Royal Enfield, VE Commercial ▪ LMD – Light and Medium Duty Vehicles and 50% of Eicher Polaris Pvt. Ltd. ▪ MHCV – Medium and Heavy Commercial Vehicles ▪ CV – Commerci
Slide 71: Thank You
Thank You Get Social Royal Enfield Royal Enfield VE Commercial Vehicles INVESTOR PRESENTATION November 2021 70
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