Escorts Kubota Limited · NSE:ESCORTS
Escorts Kubota — Escorts — Investor Day (February 2018)
108 slides from Escorts Kubota's investor day presentation, Feb 7, 2018
Slide 1: Analyst & Investors Meet
ANALYST & INVESTORS MEET 07 – Feb -2018 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 1
Slide 2: Group CFO presentation
scorts Ltd. Mr. Bharat Madan Group CFO 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 2
Slide 3: Key Takeaways: Union Budget 2018
KEY TAKEAWAYS: UNION BUDGET 2018 Rural focussed budget 2 years of on-time Normal Monsoon ‘2X Farmers income by FY2022’ - Govt. ₹ 2000 Cr for Rural infrastructure Housing for all by FY2022 1.5X Production cost = Kharif MSP ₹ 1.49 Lacs Cr CAPEX for Indian Crop Insurance Allocation Railway Horticulture
Slide 4: Proud Partner in National Development
PROUD PARTNER IN NATIONAL DEVELOPMENT Bringing World’s Best to India and Many firsts offering India’s Best to the World More than 60 year >1 million of collaboration satisfied customers with Indian Railways Dominant Player 1st to bring in Crane Segment Backhoe Loader in India 07 - Feb - 18 Copyright
Slide 5: Journey So Far!
JOURNEY SO FAR ! 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 5
Slide 6: Report Card of 2016 Meet
REPORT CARD OF 2016 MEET… Focus on Cost Reduction: Material Cost ✓ Divestment of Auto Part Division ✓ ECE Turnaround ✓ EAM EBIT Margin: 13~15% ✓ RED Organic Growth ✓ 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 6
Slide 7: Report Card of 2016 Meet (continued)
…REPORT CARD OF 2016 MEET Exports Growth ✓ Region-wise domestic market share gain has started… ✓ Focus on Manpower Cost Reduction ✓ Improving Corporate Governance ✓ 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 7
Slide 8: Material Cost
↓ MATERIAL COST Project Shikhar: Completed in FY17 VA/VE 73.1% 71.7% 71.5% ↓6.6% to continue further 67.9% 67.0% 66.8% FY12 FY12-14 FY15 FY16 FY17 9MFY18 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 8
Slide 9: Manpower Cost
↓ MANPOWER COST 12% MANAGERIAL MANPOWER 10% 11% 11% IS CONSISTENTLY 9% GOING DOWN FY14 FY15 FY16 FY17 FY18 (9M) PERSONNEL COST / REVENUE (%) 10.4 8.9 8.7 ❖ Creation of centers of excellence 8.1 8.5 ❖ Shared services ❖ Outsourcing (Non-core jobs) ❖ Natural attrition FY14 FY15 FY16 FY17 FY18 (9M) TOTA
Slide 10: Key Financial Metrics
↑ KEY FINANCIAL METRICES REVENUE (Cr) EBITDA (Cr) % 4,194 4,168 450 10.7% 12% 3,894 3,986 3,580 400 3,439 350 8% 10% 6% 300 8% 250 5% 5% 4% 6% 200 150 4% 100 182 254 161 177 324 383 2% 50 0 0% # # # # # # SY12 FY12-14 * FY15 FY16 FY17 9MFY18 SY12 FY12-14* FY15 FY16 FY17 9MFY18 PAT (Cr) % ROCE % 250
Slide 11: Consistent Rating Upgrades
↑ CONSISTENT RATING UPGRADES LBBB- LBBB LBBB+ A- A A+ (₹ Cr) 600 553 111 120 500 96 480 100 436 400 361 80 57 300 290 50 263 60 206 192 200 302 31 40 220 22.3 159 100 114 20 263 230 178 140 104 78 0 0 FY 11-12 FY 12-14 FY 14-15 FY 15-16 FY 16-17 9M FY 17-18 *Nos. from FY 11-12 to FY 14-15 is as per
Slide 12: Escorts Share Price vs Sensex
THANK YOU FOR YOUR TRUST IN US… 1000 Escorts Ltd. Sensex 40,000.00 900 Escorts Ltd. Share Price 800 35,000.00 700 1180% 200% 600 30,000.00 Sensex 500 400 25,000.00 300 200 20,000.00 100 0 15,000.00 02-Apr-12 02-Apr-13 02-Apr-14 02-Apr-15 02-Apr-16 02-Apr-17 02-Feb-18 07 - Feb - 18 Copyright @ Escort
Slide 13: Value Creation for Shareholders
VALUE CREATION FOR SHAREHOLDERS MARKET CAPITALIZATION (₹ Cr) 10,936.3 13x 6,603.8 6 YEARS 1,478.9 1,555.5 1,708.7 840.9 606.8 FY12 FY13 FY14 FY15 FY16 FY17 6th Feb 2018 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 13
Slide 14: Corporate Governance
↑ CORPORATE GOVERNANCE Vibrant Board Big 4 as I-Auditor Young leadership Launches update Monthly Tractor Volume Disclosure Quarterly Earnings Con-calls 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 14
Slide 15: The Way Forward
THE WAY FORWARD Market Expansion Focus on Corporate Governance, Brand Development Compliances & Control Developing Emerging Businesses Leveraging Construction and Railway Business Developing Earnings Growth & New Products Investor Return Profit & Cash focus; Developing Capital Allocation New Markets
Slide 16: 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED
07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 16
Slide 17: Escorts Agri Machinery (EAM)
ESCORTS AGRI MACHINERY (EAM) Mr. Shenu Agarwal - CSMO 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 17
Slide 18: Tractor Sowing for Bumper Harvest
TRACTOR SOWING FOR BUMPER HARVEST India Holds the 2nd Largest Improve Retail Finance Agricultural Land in The World Rural Focussed Budget Bumper Food Grain Production Government Focus to Double the 2 Years of on-time Normal Monsoon Agri-Income of Farmers By 2022 07 - Feb - 18 Copyright @ Escorts Ltd
Slide 19: Domestic Tractor Industry
↑ DOMESTIC TRACTOR INDUSTRY 7,35,000 6,80,000 Increasing Trend towards Mechanisation 5,80,982 Minimum Support Prices for Key Crops Scarcity of Labour 1,76,404 Ease of Credit Availability from Govt. FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 ❖ India is the la
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Slide 21: Domestic (Tractors)
DOMESTIC (TRACTORS) VOLUME 18%+ (APPROX.) FY(16-17) FY(17-18) 07 - Feb - 18 Map is for illustrative purposes Copyright @ Escorts Ltd. ESCORTS LIMITED 21
Slide 22: Brand Led Product Innovation
BRAND LED PRODUCT INNOVATION <30 HP 31-40 HP 41-50 HP > 50 HP FARMTRAC Prestigious & Powerful & strong Brand Legacy Atom Series FarmTrac XP FarmTrac Classic FarmTrac Executive POWERTRAC Efficient & Superior In-House Engineering Steeltrac PowerTrac DS+ PowerTrac Euro PowerTrac Euro Products introduce
Slide 23: Winning Market
WINNING MARKET Strong Market, Strong Brand 1 (11%) 12% → 14% Strong Market, Weak Brand 2 (1%) 2.7% → 8% 3 Opportunity Market (4.5%) 5.7% → 10% POWERTRAC FARMTRAC OPPORTUNITY MARKET LOW TIV 07 - Feb - 18 Map is for illustrative purposes Copyright @ Escorts Ltd. ESCORTS LIMITED 23
Slide 24: Tractors FY'22 Outlook
FY’22 OUTLOOK TRACTORS 15~16% ~11% FY18 FY19 FY20 FY21 FY22 TIME (YRS) 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 24
Slide 25: Ingredients for Growth
INGREDIENTS FOR GROWTH Dual Distribution South/West Focus Strong Brand Coverage: 90 → 99% Channel Coverage: 55 → 80% Weak Brand Coverage: 33 → 80% Compact tractor Rice tractor Product Portfolio Escorts Credit Farmtrac: 52% → 95% 6% Penetration → 40% Powertrac: 74% → 90% Steeltrac: 25% → 75% Customer
Slide 26: 24x7 Customer Support
24X7 CUSTOMER SUPPORT 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 26
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Slide 28: Emerging Businesses & International Markets
EMERGING BUSINESSES & INTERNATIONAL MARKETS Mr. Ravi Menon – Chief Executive 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 28
Slide 29: 07 - Feb - 18 *SHIP = Sprayers, Harvesters, Implements & Planters Business Copyright
07 - Feb - 18 *SHIP = Sprayers, Harvesters, Implements & Planters Business Copyright @ Escorts Ltd. ESCORTS LIMITED 29
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Slide 31: Exports (Tractors)
EXPORTS (TRACTORS) VOLUME 2x FY(16-17) FY(17-18) 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 31
Slide 32: Tractors FY'22 Outlook
FY’22 OUTLOOK TRACTORS ~8k-10k ~2k FY18 FY19 FY20 FY21 FY22 TIME (YRS) 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 32
Slide 33: Focus Markets
FOCUS MARKETS EUROPE US MARKETS SAARC LATAM AFRICA 07 - Feb - 18 Map is for illustrative purposes Copyright @ Escorts Ltd. ESCORTS LIMITED 33
Slide 34: Innovative Products
INNOVATIVE PRODUCTS NEW COMPACT SERIES AGRITECHNICA, Hannover, Germany 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 34
Slide 35: Innovative Products
INNOVATIVE PRODUCTS FARMTRAC 6075 CRDi FTES - 9120 US – EPA European Tier IV Norms & 3b Standards 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 35
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Slide 37: Revenue (Parts & Lubes)
REVENUE (PARTS & LUBES) +20% (APPROX.) FY(16-17) FY(17-18) 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 37
Slide 38: Outlook FY'22
OUTLOOK FY’22 SPARES REVENUE 9-11% 8% TRACTOR REVENUE FY(17-18) FY(21-22) 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 38
Slide 39: Focus Areas: Distribution Network
FOCUS AREAS DISTRIBUTION NETWORK 07 - Feb - 18 Map is for illustrative purposes Copyright @ Escorts Ltd. ESCORTS LIMITED 39
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Slide 41: Engines
ENGINES ~4000 UNITS ENGINE SALES FY (17-18) 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 41
Slide 42: Genset to Multi-Application Focus
GENSET → MULTI-APPLICATON FOCUS SELF PROPELLED HARVESTERS CONSTRUCTION BITUMEN EQUIPMENTS SPRAYERS AC BUS MARINE AUXILLIARY ENGINE ENGINES FIRE PUMP 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 42
Slide 43: Revenue FY'22 Outlook
FY’22 OUTLOOK REVENUE ~4x GROWTH FY (17-18) FY (21-22) TIME (YRS) 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 43
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Slide 45: Owning vs. Hiring
OWNING vs. HIRING 85% FARMERS HOLD “ I CAN AS HIRE FARM MACHINES <2HA OF LAND PER MY NEED ” MARGINAL LAND HOLDING 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 45
Slide 46: Manufacturer to Service Provider
MANUFACTURER → SERVICE PROVIDER 3 STATES PAY PER USE MODEL COMPLETE FARM SERVICES 10X x FY(17-18) FY(21-22) We are going to expand rapidly in next 2-3 years 07 - Feb - 18 Map is for illustrative purposes Copyright @ Escorts Ltd. ESCORTS LIMITED 46
Slide 47: Services
SERVICES FIELD NURSERY & PLANT HARVESTING PREPARATION PLANTING PROTECTION PUDDLING TRANSPLANTING WEED MANAGEMENT HARVESTING 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 47
Slide 48: Sprayers, Harvesters, Implements & Planters
SPRAYERS, HARVESTERS, IMPLEMENTS & PLANTERS 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 48
Slide 49: Tractor Is as Good as Its Attachments
TRACTOR IS AS GOOD AS ITS ATTACHMENTS ~2500 Cr Industry 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 49
Slide 50: SHIP Business Revenue
SHIP* BUSINESS TECHNOLOGY PRODUCT RANGE SUPPLY CHAIN DISTRIBUTION NETWORK SPRAYERS 10x REVENUE HARVESTERS ESCORTS PLANTERS SHIP x IMPLEMENTS FY (17-18) FY (21-22) TIME (YRS) 07 - Feb - 18 *SHIP = Sprayers, Harvesters, Implements & Planters Business Copyright @ Escorts Ltd. ESCORTS LIMITED 50
Slide 51: Tractors Solutions
TRACTORS SOLUTIONS 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 51
Slide 52: Escorts Construction Equipment (ECE)
ESCORTS CONSTRUCTION EQUIPMENT (ECE) Mr. AJAY MANDAHR – Chief Executive 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 52
Slide 53: Excon Video
EXCON VIDEO 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 53
Slide 54: Infrastructure on the Verge of a Takeoff
INFRASTRUCTURE ON THE VERGE OF A TAKEOFF!! GDP growth of 7% 100 Digital Smart India Cities Bullet Trains Bharatmala Housing For all NHAI 15km to Powered by Thermal and Solar Energy 30km a day 49% FDI in Defence 10 New Power for Swach Metros & 25 all Bharat Airports 07 - Feb - 18 Copyright @ Escorts
Slide 55: Indian Construction Equipment (ICE) Industry
INDIAN CONSTRUCTION EQUIPMENT (ICE) INDUSTRY Industry Industry Growth Levers Revenue Estimates Rising Infrastructure Investment 9% of GDP (FY 17) Increasing Private Sector In Roads / Communication Involvement Power / Airports / etc.. US $ 180 Billion by FY 20 Growth in Rear Estate Sector From US $ 1
Slide 56: Construction Equipment Segments
CONSTRUCTION EQUIPMENT SEGMENTS Material INDUSTRY 2017 Handling & Cranes 6 % 7.9 Concrete 10 Equipment Earth 14 62.1 Construction Moving Equipment Equipment Concrete Equipment Earth Moving Concrete Equipment Material Handling including Forklift Road Road Construction Building Equipment Material Proc
Slide 57: Segments Application & Users
SEGMENTS APPLICATION & USERS Segment Major equipment types Application Segment User • Mining Small/ Individual 70% A - Backhoe loader, • Roads Earthmoving B - Excavator, Medium fleet owners 20% 1 • Real Estate/Land Development Equipment C - Wheeled loader • Power 10% • Railways/Metros Institutional/
Slide 58: Over 45 Years of Rich Engineering History
OVER 45 YEARS OF RICH ENGINEERING HISTORY 2017 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 58
Slide 59: Product Portfolio
PRODUCT PORTFOLIO 1) Material Handling 2) Earth Moving 3) Road Construction 5/22 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 59
Slide 60: Volumes
VOLUMES +30% (APPROX.) FY(16-17) FY(17-18) 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 60
Slide 61: What We Did in Last 3-4 Years
WHAT WE DID IN LAST 3-4 YEARS New Product Launches • City Crane • Jungli • HYDRA 14EX Plus • F17 Backward integration of Construction Operations with Tractors Operations Excellence through Total Productive Maintenance White Collar Manpower Optimization (30% reduction) Cultural transformation ~Custom
Slide 62: Construction Revenue FY'22 Outlook
FY’22 OUTLOOK High CONSTRUCTION REVENUE Single Digit EBIT Margin 3X X FY17 FY18 FY19 FY20 FY21 FY22 TIME (YRS) 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 62
Slide 63: Levers for Exponential Growth
LEVERS FOR EXPONENTIAL GROWTH Strategic Tie ups Focus on Cost Reduction : Material Cost Focus on Export reach Enhancement Channel Financing Dealership & Outlet reach expansion 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 63
Slide 64: Network
NETWORK 07 - Feb - 18 Map is for illustrative purposes Copyright @ Escorts Ltd. ESCORTS LIMITED 64
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Slide 66: Railway Equipment Division (RED)
RAILWAY EQUIPMENT DIVISION (RED) Mr. DIPANKAR GHOSH - Chief Executive 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 66
Slide 67: Major Investment in Railways
MAJOR INVESTMENT IN RAILWYAS Strong Demand and Govt Policy Support to drive Mega Investments in the coming years 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 67
Slide 68: Advantage Indian Railways
ADVANTAGE INDIAN RAILWAYS • Increasing urbanization & Rising • Freight Traffic set to increase Incomes ( both urban & rural ) are significantly with private sector driving the passenger segment participation • Growing Industrialization across the Growing Attractive • Metro rail projects for 50 citie
Slide 69: Railway Industry Spend (Next 5 to 15 Years)
RAILWAY INDUSTRY SPEND (NEXT 5 TO 15 YEARS) 0.33 Lac Cr/Yr 1.12 Lac Cr/Yr 2.0 Lac Cr/Yr 1.63 Lac Cr/Yr 2017-2022 Infa Business Infra Rolling Stock 2023-2032 First 5 years maximum spend will be in Infrastructure enhancement. Then after for next 10 years there will be a shift toward spends in Rolling
Slide 70: Growth Options
Rail Operators Railway Investment Plan Growth a) Rolling Stock ▪> 0.33 Lac Cr/Yr for initial 5 Yrs Options Project, EPC, Infra Companies ▪> 1 Lac Cr/ Yr from 6th Yr onwards. b) Railway Infrastructure ▪> 2 Lac Cr/Yr for initial 5 Yrs ▪> 1.6 Lac Cr/ Yr from 6th OEM: Rolling Yr onwards. Stock Manufactu
Slide 71: Escorts Railways: Manufacturing Safety & Comfort
ESCORTS RAILWAYS: MANUFACTURING SAFETY & COMFORT To achieve Leadership position in Indian Railways Components Industry in the defined segment Major Sourcing partner for global Rolling Stock OEMs & Operators 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 71
Slide 72: Journey So Far
JOURNEY SO FAR Bogie mounted Axle Mounted Semi permanent couplers Electro pneumatic brake brake systems for Brake Systems for EMUs (Scharfenberg, for EMUs Composition brake blocks wagons (Indigenous) for LHB Germany) (Knorr Bremse, Germany) (ICER, Spain) NEW 1962 1966 1968 1969 1978 1997 2012 2013 2
Slide 73: IRIS Certification
IRIS CERTIFICATION June June 2016 2015 Stage-1 Audit passed IRIS Certification Start Dec 2016 International accreditation for Design , Development & Manufacturing in India May 2017 Certification Stage-2 Received Certification Audit Completed Aug 2017 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LI
Slide 74: Providing Cost Effective Solution to World Railways & Metros
PROVIDING COST EFFECTIVE SOLUTION TO WORLD RAILWAYS & METROS Spain Myanmar Thailand Taiwan Malaysia Ivory Coast ▪ Presence across 3 continents India Indonesia Ghana ▪ Exporting Railway products to South Bangladesh Asian, South East Asian, African, Egypt Sri Lanka Australian and European countries Ta
Slide 75: Global Customers with Whom We Are Working
GLOBAL CUSTOMERS WITH WHOM WE ARE WORKING Working closely with new global customers for theirs upcoming projects in INDIA Working closely with new global customers for theirs upcoming projects in INDIA 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 75
Slide 76: On Growth Track
ON GROWTH TRACK YOY EBIT GROWTH CONSISTENT ORDER BOOK GROWTH of more than 25 % from FY15 ₹ 330 Crs. – DEC’17 227.8 242.5 ✓ Manpower Cost, Productivity Improvements 210.6 182.5 183.5 ✓ Material Cost improvements ✓ New Product Revenue boost ✓ Building Strong Inhouse R&D FY14 FY15 FY16 FY17 9MFY18 REVE
Slide 77: Growth Momentum to Continue
Growth momentum to continue 4X Strategic Tie-up & Inorganic Leveraging Core Strengths X 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED
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Slide 79: Human Resources (HR)
HUMAN RESOURCES (HR) Mr. Amanppreet Singh Bhatia 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 79
Slide 80: Cultural Transformation @ Escorts
CULTURAL TRANFORMATION @ ESCORTS Be a “Significant Player” in the BUSINESS OBJECTIVE markets where we operate with a “Healthy” bottom line 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 80
Slide 81: Levers
LEVERS 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 81
Slide 82: Levers
LEVERS Integration of structures at backend and frontend across EL Functional organization with clear-cut accountabilities bringing about ownership Clubbing of roles / jobs – removing duplication of roles Optimizing span of control Rationalising Manpower Cost 07 - Feb - 18 Copyright @ Escorts Ltd. E
Slide 83: Levers
LEVERS Redefining the Performance Management Process – Change the narrative from “Managing Performance” to “Enabling Performance” 360 degree feedback of Leadership team to build a culture of Transparency for better Governance and Performance Introduction of GPTW – Take the engagement score from 63%
Slide 84: Levers
LEVERS Identify and Groom internal “Critical talent” and “Successors” – Creating internal talent pool of future leaders in the organization – Fill 60% - 70% positions from within the organization Creating “Functional Specialist” for key roles – R&D, Operations and Sales & Marketing Building frontlin
Slide 85: Levers
LEVERS Hire the right talent at the grass root level – Focus on Campus hiring Provide internal opportunities – Career Path Focus on Employee Engagement and Benefits Building opportunities to learn and grow Identification of High Potential Talent and creating internal talent for Succession 07 - Feb -
Slide 86: Levers
LEVERS Transition from “Transactional” focused HR to “Transformational” role of HR focusing on Business outcome Digitization HR process with best in class technology platform Impactful HR analytics for driving Performance Culture and Talent Management Real time Information at finger tips 07 - Feb -
Slide 87: Culture Building Framework @ Escorts
CULTURE BUILDING FRAMEWORK @ ESCORTS Performance Leadership Driven Development Culture Capability Coaching Functional CULTURE IS A JOURNEY, Employee Building Leadership, Performance Driven | Capability Engagement & Succession and Functional Engaged Employees Environment capability Design NOT A DESTI
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Slide 89: Future Transformation Journey
Future Transformation Journey SCORTS LTD. Mr. Shailendra Agarwal Chief Transformation Officer (CTO) 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 89
Slide 90: Escorts Business Transformation
ESCORTS BUSINESS TRANSFORMATION PERFORMANCE CAPABILITY BUILDING ❖ Outperforming Industry in OE Sales ❖ Enhancing Product portfolio ❖ Additional revenue streams – ❖ Agile and responsive Processes Spares, Trading and Services ❖ Plant capability - 2 X within existing space ❖ Cost Competitiveness - Mate
Slide 91: Outperforming Industry in Sales Growth
OUTPERFORMING INDUSTRY IN SALES GROWTH Investing in Brands - Farmtrac and Powertrac ▪ Separate channels for Farmtrac & Powertrac to enhance sales & Marketing focus ▪ Widening & deepening pan-India distribution channels for Customer reach New way of working for Sales acceleration ▪ “Triplet Based Str
Slide 92: New Products (FY2016-2018) – Domestic Market
NEW PRODUCTS (FY 2016→2018) – DOMESTIC MARKET COMPACT SEGMENT SUB UTILITY SEGMENT UTILITY SEGMENT FARMTRAC Classic Series 35 to 45 HP Classic Series FT 6080 PRO 45 to 55 HP Compact Series - F20 Technology 22 & 26 HP - T20 Technology EURO 55 PT 434 PLUS PT 439 PLUS POWERTRAC EURO 60 STEELTRAC PT 425
Slide 93: New Products (FY2016 to 2018) – Export Market
NEW PRODUCTS (FY 2016 TO 2018) – EXPORT MARKET Compact Segment Sub Utility Segment Utility Segment FT 6045 FT 6075 PRO EURO 60/75 4WD FT 6080 PRO FT 6090 PRO FT 6050 C 22 HP 25 HP 26 HP 30 HP Mechanical & HST FT 6090 X PRO FT 6090 X PRO CAB 22 HP 22 HP to 90 HP PRODUCTS RANGE 90HP 07 - Feb - 18 Copy
Slide 94: Transformational Products – ECE
TRANSFORMATIONAL PRODUCTS – ECE RT 40 POWER BOOM CT SMART 15 Jungli 4 x 4 New EC 5250 with Water Cooled Engine 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 94
Slide 95: Future Product Map - 2022
FUTURE PRODUCT MAP - 2022 EMISSIONS LEVERS FOR SUPPORT ➢ STAGE IV - EU ➢ TIER IV - USA ➢ STAGE V - EU DISEL OXIDATION CATALIST- DOC ➢ BHARAT TREM IV - INDIA COMMON RAIL DIRECT INJECTION DRIVE TRAINS ➢ HYDRO STATIC ➢ SYNCHRO SHUTTLE ➢ POWER SHIFT ➢ MULTIPLE SPEEDS (AS PER DIFF SOIL & APP.) HYDROSTATI
Slide 96: Future Product Map - 2022
FUTURE PRODUCT MAP - 2022 ➢ TARGETING LOWER & HIGHER HP SEGMENT PRODUCTS ➢ ALTERNATE FUEL PRODUCTS LEVERS FOR SUPPORT UTILITY SEGMENT SUB UTILITY SEGMENT COMPACT SEGMENT 60 HP 110 HP 45 HP 18 HP 55 HP 35 HP ➢ LOWER HP FOR BASIC ORCHARD ➢ 45-50 HP LIGHT WEIGHT OFFERING NEEDS ➢ NEW STYLING & PLATFORMS
Slide 97: Agile and Responsive Processes
AGILE AND RESPONSIVE PROCESSES New way of working for Sales acceleration ▪ Digitization of processes and advanced analytics – Lead generation, lead prioritisation and recommendation to Dealer Sales executive ▪ ESMS (Escorts Sales Management ) & EDMS (Escorts Dealer Management ) TPM as a Core methodo
Slide 98: Cost Competitiveness
COST COMPETITIVENESS Material Cost : Targeting for Best in Industry Cost structure ▪ Alternate Vendors, Alternate technologies and Alternate materials ▪ Supplier suggested Value engineering with benefit sharing ▪ Design levers – Feature value analysis, Model specific tear down for high volume – low
Slide 99: Plant Capability
PLANT CAPABILITY Plant Capability for 150,000 Tractors in existing space ▪ Lean Inhouse Manufacturing with focus on Strategic and critical to Quality activities ▪ Building flexibility in manufacturing lines for changing model mix ▪ New tooling technology for cycle time reduction ▪ Overall equipment
Slide 100: Building Performance Culture
Building Performance Culture Enable Programme ❖Enable through Capability building, communications Communication and Strengthening Business Processes Capability Partnerships building Business Strengthen Culture Transformation Transformation business ❖Stretch through audacious goals and processes targ
Slide 101: Plan to 2022
PLAN TO 2022 CAPABILITY BUILDING Our Aspiration for 2022 ❖Enhancing Product portfolio EAM (Escorts Agri Machinery) ❖Agile and responsive Processes - Sales ✓ To create standards & Lead Indian Farm Mechanization Services Industry lead gen to conversion, Product ✓ To achieve challenger position (No.2)
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Slide 103: Vision By 2022
Vision By 2022 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 103
Slide 104: Revenue (₹ Cr.)
REVENUE (₹ CR.) 2.5x FY17 Aspiration 2022 2x 3x 4x FY17 Aspiration 2022 FY17 Aspiration 2022 FY17 Aspiration 2022 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 104
Slide 105: Vision 2022
VISION 2022 2.5X Revenue 10% Plus Margin 13~14% 25% - 30% 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 105
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Slide 107: Safe Harbor
SAFE HARBOR Certain statements in this document include forward-looking comments and information concerning the company’s plans and projections for the future, including estimates and assumptions with respect to economic, political, technological, weather, market acceptance and other factors that im
Slide 108: The New Escorts Together 2022
THE NEW ESCORTS TOG THER 2022 07 - Feb - 18 Copyright @ Escorts Ltd. ESCORTS LIMITED 108