Mahindra & Mahindra Ltd. · NSE:M&M
Mahindra & Mahindra — Q1 FY2024 Earnings Presentation
40 slides from Mahindra & Mahindra's earnings presentation, Aug 4, 2023
Slide 1: Exchange filing cover letter
Mahindra & Mahindra Ltd. Mahindra Towers, Dr. G. M. Bhosale Marg, Worli, Mumbai 400 018 India Tel: +91 22 2490 1441 Fax: +91 22 2490 0833 www.mahindra.com REF:NS:SEC: 4th August, 2023 National Stock Exchange of India Limited BSE Limited "Exchange Plaza", 5th Floor, Phiroze Jeejeebhoy Towers, Plot No
Slide 2: Delivering Scale - Analyst Meet
Delivering Scale Analyst Meet Dr Anish Shah | 4 August 2023 1
Slide 3: Agenda
Agenda Capital Allocation Financial Results 2
Slide 4: Capital Allocation
Capital Allocation D Ri. mahindra ~
Slide 5: RBL: capital allocation framework unchanged
RBL Our capital allocation framework is unchanged • We have invested ~INR 400 crores for a 3.5% stake in RBL Bank • Financial Services is a core area, Mahindra Finance has a valuation close to INR 40,000 crores • This investment is based on a long-term view (7-10 years). The primary purpose is to un
Slide 6: Enhanced transparency & accountability
Enhanced transparency & accountability Segments • Auto: Core Auto (SUV, LCV), MEAL & LMM, MTBD, allied businesses, International • Farm: Domestic tractors, Farm Machinery, allied businesses, International Services: • Financial Services: Mahindra Finance • Industrial Businesses & Consumer Services: T
Slide 7: Net cash generated: F22 - Q1 F24
Net cash generated: F22 - Q1 F24 Rs Cr Rs Cr STANDALONE M&M + MEAL Auto Farm Services RsCr Total Rs Cr + Inflow 13,129 6,933 5,611 25,673 Deployment (9,058) (2,359) (415) (11,831) - Capex (6,000) (1,852) (7,852) - EV: MEAL net& (767) (767) - Investments Clean up (Cat C) (1,212) (1,212) Ongoing (1,07
Slide 8: Financial Results
Financial Results D Ri. mahindra ~
Slide 9: Consolidated M&M results: Q1 F24
Consolidated M&M results: Q1 F24 Rs Cr Revenue PAT 33,892 19% 60% 3,508 28,414 2,196 Q1 F23 Q1 F24 Q1 F23 Q1 F24 Strong operating leverage in Auto and capital allocation actions 8
Slide 10: Strategy Recap: Delivering Scale
Strategy Recap : Delivering Scale Rs Cr Auto Farm Services SUVs LCVs Trucks & Buses Unlock Full Potential Growth Gems Growth Gems Growth Gems Capitalize on Capitalize on Market Leadership Market Leadership 5X Challenge 9
Slide 11: Capitalize on market leadership
Capitalize on market leadership Rs Cr Auto Farm ▪ SUV production 28% YoY ▪ Resilient performance despite industry decline ▪ Operating leverage driving margin improvement ▪ Steady QoQ margin improvements ▪ EV programs and scale up on track ▪ Strong cashflow generation ▪ KG Mobility re-listing … MTM
Slide 12: Unlock full potential
Unlock full potential MMFSL Tech Mahindra ▪ Asset growth momentum … disbursement ▪ Muted demand cycle ▪ Sustained improvement in asset quality ▪ One-off margin impact … ~190 bps ▪ Decline in NIM … portfolio mix, interest cost ▪ Leadership transition underway Q1 F24 VPY Q1 F24 VPY GS3% 4.3% 370 bps
Slide 13: 5X challenge for Growth Gems
5X challenge for Growth Gems Rs Cr Logistics Hospitality Real estate ▪ Strong growth in Auto & Mobility ▪ Buoyant demand … occupancy 90% ▪ Demand continues to be healthy ▪ Muted demand in Ecommerce ▪ Healthy room & member additions ▪ Residential sustenance sales … ▪ Margin 180 bps … offset by ▪ HC
Slide 14: Consistent delivery on commitments
Consistent delivery on commitments RoE EPS ROE% Rs 24.2% 19.9% 31.4 13.8% 14.8% 19.7 15.6 0.3% 4.4% 8.2 3.8 (0.9) # F19 F20 F21 ^ F22 F23 Q1 F24 Q1 F19 Q1 F20 Q1 F21 Q1 F22 Q1 F23 Q1 F24 13 # Annualised basis the quarter ROE ^ Considering continuing & discontinued operations
Slide 15: Key Messages
Key Messages • Consolidated PAT 3,508 Cr, 60% … Key drivers are Auto, Farm, MMFSL and investment gains • Auto and Farm capitalizing on market leadership … Operating PAT 2.2x for Auto, 21% for Farm • Mahindra Finance PAT 58%, GS3 at 4.3% & NS3 at 1.8% … Challenges at TechM resulting in lower
Slide 16: Automotive Business
Automotive Business Analyst Meet Rajesh Jejurikar | 4 August 2023
Slide 17: Q1: Auto
Q1: AUTO TOTAL VOLUMES 186K 21% YoY SUV VOLUMES CROSS 1L REVENUE MS 20.2% 310 bps YoY #1 IN SUV REVENUE MS LCV <3.5T MS 49.1% 480 bps YoY HIGHEST QUARTERLY MS IN LAST 5 YRS 16
Slide 18: #1 in SUV
#1 IN SUV VOLUMES REVENUE MARKET SHARE #2 in MS for 4 consecutive quarters #1 for 6 consecutive quarters 20.6% 20.2% 1,00,162 19.6% 19.0% 91,632 17.9% 99,112 17.1% 74,779 90,797 15.6% 56,887 75,420 14.2% 49,446 12.9% 42,570 Q1F22 Q2F22 Q3F22 Q4F22 Q1F23 Q2F23 Q3F23 Q4F23 Q1F24 Q1F22 Q2F22 Q3F22 Q4F2
Slide 19: Strong UV performance & pipeline
STRONG UV PERFORMANCE & PIPELINE Open Bookings: ~281k 11k open bookings 77k open bookings 68k open bookings 8.4k open bookings 117k open bookings ~6k per month ~8k per month ~10k per month ~9k per month ~14k per month XUV3OO & THAR BOLERO SCORPIO-N XUV4OO XUV7OO (Incl RWD) (incl NEO) (incl Classic)
Slide 20: Capacity planning
CAPACITY PLANNING Q4 F22 Q4 F23 Q4 F24 Per Month Capacity Exit Capacity Exit Capacity Exit Capacity Overall SUVs Capacity* 29k 39k 49k ▪ Q1 F24 Volume impact of ~5k in SUVs and ~2K in Pik-Ups: - Short-term disruption in engine-related parts at the supplier end - Semiconductor supply constraints on A
Slide 21: #1 in LCV <3.5T
#1 IN LCV <3.5T Q1 F24 MS 49.1%, gain of 4.8% YoY LCV <3.5T Volumes LCV <3.5T MS 61,839 61,345 48.1% 49.1%* 59,000 57,029 58,327 57,932 46.9% 46.5% 44.3% 44.4% 42.7% 44,165 37.5% 37,782 33,166 34,351 34.9% 33.2% Q4F21 Q1F22 Q2F22 Q3F22 Q4F22 Q1F23 Q2F23 Q3F23 Q4F23 Q1F24 Q4F21 Q1F22 Q2F22 Q3F22 Q4F2
Slide 22: International launches
INTERNATIONAL LAUNCHES Australia New Zealand South Africa Brisbane Auckland Bloemfontein Brisbane Auckland Somerset Blockbuster XUV 700 Launch Blockbuster XUV 700 Launch Blockbuster Scorpio-N Launch 20+ Media houses from all states Launch at a race track 400 km off-roading for media & influencers 1M
Slide 23: Last mile mobility
LAST MILE MOBILITY Sales Volume1 22,619 23,131 22,945 21,459 ▪ Highest ever E-3Ws volumes1 at 14.7k in Q1 F24 8,476 8,285 16,436 11,994 9,658 ▪ Market Leadership in E-3W with 65.5% MS in Q1 F24 9,930 ▪ E-3W sales crossed 1L milestone 14,655 14,660 10,625 11,801 ▪ Received India’s 1st Automotive PLI
Slide 24: Electric SUV programs - on track
ELECTRIC SUV PROGRAMS – ON TRACK Build on the purpose-built, ground up platform that outperforms on every level - speed, efficiency, safety, and adaptability Models XUV.e8 XUV.e9 BE.05 BE RALL-E BE.07 SOP Dec 2024 Apr 2025 Oct 2025 Oct 2025 Oct 2026 23
Slide 25: MEAL valuation of up to Rs 80,580 Cr ($9.8bn)
MEAL VALUATION OF UPTO RS 80,580 CR ($9.8BN) ▪ Temasek will invest Rs 1,200 cr in one or more tranches ▪ MEAL valuation of upto Rs 80,580 cr (~$ 9.8bn)* post-money valuation, an increase of 15% from BII’s valuation of upto Rs. 70,070 crs ▪ Temasek Ownership range: 1.49% to 2.97% ▪ Key Rights: Govern
Slide 26: Auto conso financials Q1 F24
AUTO CONSO FINANCIALS Q1 F24 Rs Cr Revenue PBIT 27% 141% 405 81% 16,999 13,366 1,234 680 Q1 F23 Q1 F24 Q1 F23 Q1 F24 25 Q1 F24 PBIT includes Rs. 405 Cr. MTM gain due to relisting of SYMC shares (KG Mobility) PBIT is net of intercompany eliminations, stock reserve, impairment and after share of profi
Slide 27: Auto margin improvement continues
AUTO MARGIN IMPROVEMENT CONTINUES Auto Standalone PBIT% 7.5% 7.1% 7.5% 6.6% 5.3% 5.9% F19 Q1 F23 Q2 F23 Q3 F23 Q4 F23 Q1 F24 26 Auto Standalone Segment now includes Two-Wheeler Manufacturing and Spares Business
Slide 28: Farm Equipment
Farm Equipment D Ri. mahindra ~
Slide 29: Q1: Farm
Q1: FARM VOLUME 114K 3% YoY 2ND HIGHEST EVER QUARTERLY VOLUMES MARKET 42.9% 20 bps YoY HIGHEST QUARTERLY MS SINCE Q2 F20 LEADERSHIP 28 Market Share includes Gromax
Slide 30: Market leadership
MS includes Gromax Q1 F19 43.5% Q2 F19 Q3 F19 Q4 F19 Q1 F20 43.3% Q2 F20 Q3 F20 Q4 F20 MARKET LEADERSHIP Q1 F21 39.1% Q2 F21 Q3 F21 Q4 F21 Q1 F22 41.8% Q2 F22 Highest quarterly MS since Q2 F20 Q3 F22 Q4 F22 Q1 F23 42.7% Q2 F23 Q3 F23 Q4 F23 Q1 F24 42.9% 29
Slide 31: Market strategy
MARKET STRATEGY Q1 F24 MS 42.9% (0.2% YoY gain) YTD F24 MS 42.6% (0.5% YoY gain) Strategy for further MS gain Channel Dominance Launch of OJA and Swaraj Target Current 1500+ Dealers Orchard / LWT Market Size: ~50,000 New Channel Strategy with OJA Segment MS1 – ~30% 1. Application based segment
Slide 32: Farm machinery - scaling up for quantum growth
FARM MACHINERY – SCALING UP FOR QUANTUM GROWTH FM Revenue Rotavator Est. Market Share Q1 F24: 181 Cr Q1 F24: 23.5% (19.5% in Q1 F23) (24% YoY growth) No. 2 in Rotavators Strengthening Product Portfolio Growth in Q1 F24 vs PY Successful Product launch of 4500 loader series for North America market RT
Slide 33: Farm conso financials Q1 F24
FARM CONSO FINANCIALS Q1 F24 Rs Cr Revenue PBIT 9% 22% 9,710 8,915 1,472 1,204 Q1 F23 Q1 F24 Q1 F23 Q1 F24 32 Q1 F24 nos are after hyper inflation accounting for Turkey companies PBIT is net of intercompany eliminations, stock reserve, impairment and after share of profit from JV/ Associates
Slide 34: Farm margin improvement continues
FARM MARGIN IMPROVEMENT CONTINUES Farm Standalone PBIT % Core Tractor* PBIT % 19.8% 18.7% 18.6% 17.5% 17.9% 17.5% 17.3% 16.3% 16.3% 16.4% 16.9% 15.9% F19 Q1 F23 Q2 F23 Q3 F23 Q4 F23 Q1 F24 F19 Q1 F23 Q2 F23 Q3 F23 Q4 F23 Q1 F24 33 Farm Standalone segment now includes Powerol Business *Core Tractor c
Slide 35: Financials
Financials Analyst Meet Manoj Bhat | 4 August 2023
Slide 36: Financial results: Q1 F24 consolidated
Financial results: Q1 F24 CONSOLIDATED M&M Rs Cr Revenue PAT 33,892 19% 60% 3,508 28,414 2,196 Q1 F23 Q1 F24 Q1 F23 Q1 F24 35
Slide 37: PAT: Q1 F24
PAT: Q1 F24 CONSOLIDATED M&M Rs Cr Q1 F23 Q1 F24 Q1 F23 to Q1 F24 60% Auto 462 1,401# 169 3,508 205 Farm 993 1,198 KG Mobility 405 (SYMC) Services 740 909 2,196 533 TechM 320 195 MMFSL 125 188 Growth Gems & Others 295 527 Total 2,196 3,508 PAT (Q1 F23) AUTO FARM SERVICES PAT (Q1 F24) 36 # Includes b
Slide 38: Financial results: Q1 F24 standalone
Financial results: Q1 F24 STANDALONE M&M Rs Cr Revenue EBITDA PAT 24,368 23% 46% 98% 3,547 2,774 19,813 2,422 1,404 Q1 F23 Q1 F24 Q1 F23 Q1 F24 Q1 F23 Q1 F24 37
Slide 39: Q1 F24: P&L Walk
Q1 F24: P&L Walk Rs Cr Standalone Consolidated Rs Cr Old approach Changes Reported Old approach Changes Reported Q1 F24 Q1 F24 Q1 F24 Q1 F24 Q1 F24 Q1 F24 Revenue from operations 24,056 - 24,056 33,406 - 33,406 Income from investments related to subsidiaries, - 312 312 - 485 485 associates and joint
Slide 40: Thank you
Thank you _— 39
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