Slide 1: Cover letter to stock exchanges: Investor Meet Presentation
ATL/SEC/21 November 5, 2020 The Secretary, The Secretary, BSE Ltd. National Stock Exchange of India Ltd, Phiroze Jeejeebhoy Towers, Exchange Plaza, Dalal Street, Bandra-Kurla Complex, Mumbai – 400001. Bandra (E), Mumbai - 400 051 Sub: Investor Meet – Presentation Dear Sirs, Pursuant to Regulation 30
Slide 2: 2Q FY 2021 – Investor Presentation
2Q FY 2021 – Investor Presentation November 2020
Slide 3: Disclaimer
Disclaimer These materials have been prepared by Apollo Tyres Limited together with its subsidiaries (the “Company”), are for informational purposes only and do not constitute a prospectus or an offer document, or form part of an offer, solicitation or invitation of any offer to purchase or subscrib
Slide 4: Table Of Contents
Table Of Contents Page # 1 Company Overview & Highlights 4 2 COVID-19 Update 11 3 Key Near-Term Areas of Focus 16 4 Quarter Update (2Q FY 2021) 22 5 Key Financials 29 apollotyres.com 3
Slide 5: Apollo Tyres – The No 1 Radial Tyre Player in India
Apollo Tyres – The No 1 Radial Tyre Player in India Revenue Mix – Consolidated 2Q FY 2021 Large scale & sustained profitability profile Consolidated Revenue of ~₹161 Bn in FY 2020 By Product By Channel Consolidated EBITDA of ~₹19 Bn (12%) in FY 2020 Light Others, 5% Truck, 5% Strong brands with
Slide 6: Well Set to Leverage Attractive Market Opportunity
Well Set to Leverage Attractive Market Opportunity Key milestones over past ~10 years Past Decade Significant investments made in 2020 building brand, plant 2018 infrastructure, distribution, and R&D capability 2017 Today Enjoy leading market position 2010 Commenced and industry-leading capacity pro
Slide 7: Strong Management Team with Deep Experience
Strong Management Team with Deep Experience Onkar S Kanwar Neeraj Kanwar Hizmy Hassen Markus Korsten Gaurav Kumar Daniele Lorenzetti Chairman & Vice Chairman & IT & Digital Advanced Finance & Legal Research & Managing Director Managing Director Manufacturing & Technology European Manufacturing Opera
Slide 8: Experienced Board of Directors with Wide Expertise
Experienced Board of Directors with Wide Expertise Onkar S Kanwar Neeraj Kanwar Anjali Bansal Akshay Francesco Crispino Francesco Gori Vishal Mahadevia Chudasama Chairman & Vice Chairman & Former Partner and Managing Partner Co-Founder Former-CEO MD, Head of Managing Director Managing Director India
Slide 9: Investment Highlights
Investment Highlights Positive industry dynamics Robust demand momentum in replacement segment India in rapid phase of radialization trend – strong underlying growth profile Attractive market structure consolidating around strong, established domestic brands Restriction on imports have fur
Slide 10: Investment Highlights
Investment Highlights Strong execution in challenging market environment Both revenues and profits higher than prior year for last quarter, despite COVID-19 Continue to gain share in replacement and OE markets in India Efficient working capital management also contributed to free cash flow g
Slide 11: Table Of Contents
Table Of Contents Page # 1 Company Overview & Highlights 4 2 COVID-19 Update 11 3 Key Near-Term Areas of Focus 16 4 Quarter Update (2Q FY 2021) 22 5 Key Financials 29 apollotyres.com 10
Slide 12: Performance During COVID-19
Performance During COVID-19 India Strong demand momentum across key segments Recorded best ever volumes in Truck & Bus replacement and Passenger vehicle replacement in September 2020 Recorded best ever volumes in Agri (tractor rear) replacement in June 2020 Enthusiastic response to recent la
Slide 13: Performance During COVID-19
Performance During COVID-19 Cash flows Generated free cash flow (consolidated) of ₹ ~9.1bn during 1HFY21, driven by Recovery in top line performance and control over costs Reduced finished goods inventory (consolidated) by 30% (compared to Mar’20) and RM inventory by 7% (compared to Mar’20) le
Slide 14: Dealing with COVID-19 – Employee Initiatives
Dealing with COVID-19 – Employee Initiatives Employee Engagement, Recognition and Welfare apollotyres.com 13
Slide 15: Dealing with COVID-19 – Resuming production
Dealing with COVID-19 – Resuming production apollotyres.com 14
Slide 16: Table Of Contents
Table Of Contents Page # 1 Company Overview & Highlights 4 2 COVID-19 Update 11 3 Key Near-Term Areas of Focus 16 4 Quarter Update (2Q FY 2021) 22 5 Key Financials 29 apollotyres.com 15
Slide 17: Key Near-Term Areas of Focus
Key Near-Term Areas of Focus Strong focus on business fundamentals Consolidating position in India with 3R strategy Range – A formidable portfolio that allows leadership position in India and a wider footprint in export markets Rural – New distribution formats facilitating access to untapped
Slide 18: Key Near-Term Areas of Focus
Key Near-Term Areas of Focus Thrust on Digitalisation Focus areas - Process digitalization, Business Model Innovation and Social media use in media mix Multiple digital product launches across regions Focus on raw materials R&D focus on new recipes to a) boost performance and b) reduce inp
Slide 19: Focus on Brand Building
Focus on Brand Building Global brands with a legacy of performance, quality, trust and reliability Most Valuable Indian Brands (2019) – Brand Finance Rank 53 Rank 69 Rank 93 Apollo MRF JK Onboarded “God of Cricket” as Apollo Tyres’ Brand Ambassador apollotyres.com 18
Slide 20: Focus on Brand Building
Focus on Brand Building Customer engagement activities Bad road buddies Track day in Hungary Devil’s circuit Art of driving videos apollotyres.com 19
Slide 21: Expanding Footprint in Rural India
Expanding Footprint in Rural India Total rural outlets (including sub dealers) 5,000 4,150 4,000 3,000 2,000 1,230 1,350 1,000 0 FY19 FY20 Sept '20 apollotyres.com 20
Slide 22: Table Of Contents
Table Of Contents Page # 1 Company Overview & Highlights 4 2 COVID-19 Update 11 3 Key Near-Term Areas of Focus 16 4 Quarter Update (2Q FY 2021) 22 5 Key Financials 29 apollotyres.com 21
Slide 23: Key Marketing Initiatives and Customer Wins
Key Marketing Initiatives and Customer Wins India Continued focus on gaining new customers and deepening ties with existing customers in the OEM segment Started deliveries to Kia India Secured fitment on almost all recently launched SUVs - Hyundai Creta , Tata Gravitas & Toyota Urban Cruiser
Slide 24: Podium Positions in Europe
Podium Positions in Europe Date Test Agency Recommendation Position Tyre Model Apr-20 ADAC Recommendable 4th Vredestein Vorti Apr-20 AutoBild Top 50 Exemplary 4th+5th Vorti and Aspire XP Apr-20 AutoBild Allrad Exemplary 3rd Vredestein Ultrac Satin Apr-20 AutoBild Sportscars Good 4th Vredestein Vorti
Slide 25: Operating Highlights – Consolidated
Operating Highlights – Consolidated Sales (₹ Mn) EBITDA Margin (%) 43,000 20% 42,338 16.2% 16% 41,000 39,261 12% 10.8% 39,000 8% 37,000 4% 35,000 0% 2QFY20 2QFY21 2QFY20 2QFY21 Topline performance driven by demand recovery both in India and Europe Margin performance helped by a) recovery in topl
Slide 26: Operating Highlights – India
Operating Highlights – India Sales (₹ Mn) EBITDA Margin (%) 29,000 20.0% 18.8% 28,614 18.0% 28,500 16.0% 14.0% 28,000 11.7% 12.0% 27,500 10.0% 27,150 8.0% 27,000 6.0% 4.0% 26,500 2.0% 26,000 0.0% 2QFY20 2QFY21 Q2FY20 Q2FY21 Volume Almost all product segments posted double digit volume growth (Yo
Slide 27: Operating Highlights – Europe
Operating Highlights – Europe1 Sales (€ Mn) EBITDA Margin (%) 130 129 129 12.0% 125 9.0% 9.0% 120 6.7% 115 6.0% 110 3.0% 105 100 0.0% 2QFY20 2QFY21 2QFY20 2QFY21 Maintained YoY revenue despite subdued demand environment Gained market share in UHP and UUHP PCLT segments Margin supported by mix
Slide 28: Consolidated Cash Flow & Balance Sheet Highlights
Consolidated Cash Flow & Balance Sheet Highlights Control over capex Free cash flow generation Capex (₹ Bn) Free Cash flow (₹ Bn) 20 15 16 9.1 16 10 12 5 - 8 6 1HFY20 1HFY21 (5) 4 (10) - -9.5 1HFY20 1HFY21 (15) Notes: 1. Free Cash Flow: Cash from operating activities less capex, interest and lease p
Slide 29: Table Of Contents
Table Of Contents Page # 1 Company Overview & Highlights 4 2 COVID-19 Update 11 3 Key Near-Term Areas of Focus 16 4 Quarter Update (2Q FY 2021) 22 5 Key Financials 29 apollotyres.com 28
Slide 30: Profit & Loss – Consolidated
Profit & Loss – Consolidated Particulars (₹ Mn) 2QFY21 2QFY20 1QFY21 % Change - YoY % Change - QoQ Net Sales 42,338 39,261 28,282 8% 50% Other operating Income 489 597 452 -18% 8% Raw Material 1 23,014 22,442 16,308 3% 41% Staff Cost 6,233 5,943 5,370 5% 16% Other Costs 6,632 7,154 4,684 -7% 42% EBI
Slide 31: Profit & Loss – Standalone
Profit & Loss – Standalone Particulars (₹ Mn) 2QFY21 2QFY20 1QFY21 % Change - YoY % Change - QoQ Net Sales 28,614 27,150 17,273 5% 66% Other operating Income 489 597 452 -18% 8% Raw Material 1 16,808 17,464 10,901 -4% 54% Staff Cost 2,165 2,004 1,957 8% 11% Other Costs 4,646 5,027 2,961 -8% 57% EBIT
Slide 32: THANK YOU
THANK YOU For further details please feel free to get in touch with the IR team Ravi Shingari Group Head - Accounts and Taxation ravi.shingari@apollotyres.com +91 9810300390 Himanshu Sharma Divisional Head - Investor Relations himanshu.sharma1@apollotyres.com +91 9167661692 apollotyres.com 31