Tube Investments Of India Limited · NSE:TIINDIA
Tube Investments Of India — Investor Presentation (November 2019)
64 slides from Tube Investments Of India's investor presentation, Nov 6, 2019
Slide 1: Cover letter to stock exchanges on investor meeting
Tube Investments of India Limited (Formerly known as Tl Financial Holdings Limited) Dare House, 234, N.S.C. Bose Road, Chennai 600 001, India Tel: 91.44.4217 7770-5 Fax: 91.44.4211 0404 Web~ite: www.tiindia.com CIN: L351 OOTN/OORPI ('Ofiq4qfi INDIA 6th November, 2019 National Stock Exchange of India
Slide 2: Investor Presentation November 2019
Tube Investments of India Limited Investor Presentation November 2019 Tube Investments of India Limited 1
Slide 3: Index
Index Contents Table of Contents Page No Corporate Overview 4 Company Businesses • Engineering 12 • Metal formed products 24 • Cycles and Accessories 44 • Gears and Gear Products - Shanthi Gears Limited 55 2
Slide 4: Murugappa Group and Philosophy
Murugappa Group and Philosophy Net Sales FY 2018-19 Market Company Name Description Capitalisation Cholamandalam Investment and Finance Company Limited is a Non Others INR 2,40,652 mn Banking Finance Company and one of the leading financial provider Chola 2% CIFCL (USD$ 3,405 mn) for vehicle finance
Slide 5: Corporate Overview
Corporate Overview Rs. Cr. Manufacturing Businesses • Engineering Segment (Tubes, Value Added Cold Rolled Strips, & Tubular Key Financials - TII Standalone Components) Particulars H1 18-19 H1 19-20 • Metal Formed Products (Chains for Revenue from Operations 2,721 2,365 Automobile sector & Industrial
Slide 6: TII (Standalone) Businesses
TII (Standalone) Businesses Engineering Metal Formed Products Cycles and Accessories ERW & CDW Tubes, Large Chains for Automobile sector and Bicycles, fitness products and Diameter Tubes, Value Added Industrial applications, accessories Cold Rolled Strips Doorframes, Channels for and Tubular Compone
Slide 7: Business Highlights H1 2019-20
Business Highlights H1 2019-20 • Net debt reduction by Rs. 224 Cr., Revenue de-grown by 13% from Rs. 513 Cr. in Mar-19 to Rs. 289 Cr. in Sep-19 • Debt equity ratio improved to 0.3 from 0.4 in Mar-19. PBT before exceptional items at Rs. 218 Cr., grown by 33%. PBT margin • Debt/EBITDA improved to 0.8
Slide 8: TII Shareholding Pattern
TII Shareholding Pattern – Sep’19 Others 16.80% Promoter & Promoter DII 22.96% Group 47.91% FII 12.33% 7
Slide 9: Key Financials H1 2019-20
Key Financials H1 2019-20 Rs. Cr. Standalone Consolidated Particulars FY 18-19 H1 18-19 H1 19-20 FY 18-19 H1 18-19 H1 19-20 Net Sales 4,983 2,574 2,239 5,463 2,822 2,506 Growth % -13.0% -11.2% PBT before exceptional items 371 164 218 375 187 237 % to Sales 7.4% 6.4% 9.7% 6.9% 6.6% 9.4% Exceptional I
Slide 10: Performance Trends
Performance Trends Rs. Cr. Net Sales PBT (before exceptional) 371 4,983 4,335 3,925 202 218 218 2,574 164 2,239 16-17 17-18 18-19 H1 18-19 H1 19-20 16-17 17-18 18-19 H1 18-19 H1 19-20 ROCE Free Cash Flow 21% 22% 19% 208 14% 14% 154 109 95 59 16-17 17-18 18-19 H1 18-19 H1 19-20 16-17 17-18 18-19 H1 1
Slide 11: Performance Trends
Performance Trends Rs. Cr. Basic EPS (FV Re. 1) (not annualised) Capex 13.0 216 9.5 172 8.5 152 7.3 6.0 106 88 16-17 17-18 18-19 H1 18-19 H1 19-20 16-17 17-18 18-19 H1 18-19 H1 19-20 Net Debt Equity Net Debt/EBITDA 0.6 0.56 0.5 1.9 2.0 0.4 1.3 1.0 0.2 0.5 16-17 17-18 18-19 H1 18-19 H1 19-20 16-17 17
Slide 12: Businesses
Businesses Engineering Metal Formed Products Cycles and Accessories Gears and Gear Products 11
Slide 13: Engineering (Tubes and Strips)
Engineering (Tubes and Strips) Leader in CDW tubes in the Automotive industry 12
Slide 14: Two Wheeler Application
Two Wheeler Engineering Application - Two Wheeler Application Handle Bar Tube I Front Fork Tube Seat Assembly .••• ••• • ••• • • Shock Absorber Tube • ••• ••• Swing Arm Main Frame Two-Wheeler production in India de-grown by 13% in H1 19-20 13
Slide 15: Four Wheeler Application
Four Wheeler Application Anti-roll bar Steoring column Gas-filled strut Power steering Corrugalod tube syatem (st eering cQlumn) Cross-member ~--- ~verse control 11m Drive shaft Engine mount Vibration damper Balancing shaft Eng ina Shock absorber (rubberised metal) Passenger Vehicle production in In
Slide 16: Off Road Vehicle Application
Off Road Vehicle Application Hydraulic '• - -cylinder '• Hollow Dnve Shaft ----------- Rollover Protection Structure (ROPS) 15
Slide 17: Business Drivers
Business Drivers Precision Steel Tubes (CDW) largely used in Business Mix H1 19-20 Automobile applications of Two Wheelers/ Passenger Cars and Commercial Vehicles Non Auto for applications like Front Forks, Side impact 26% beams, steering columns etc. Auto 74% CDW tubes also used in Hydraulic Cy
Slide 18: Key Success Factors
Key Success Factors • Market leader in High Quality & Safety CDW Tube critical CDW Tubes for 2W and 4W applications • Only manufacturer with plants at 5 Multi Location different locations closer to customers Gearing for • Large-dia plant provides tubes for hydraulic cylinders, Off-Road Non-Auto appl
Slide 19: Major Customers Serviced
Major Customers Serviced (8) HVUOORI ~~ mahindra ~ Ashok Leyland :~to! ® TOYOTA LEYLAND DEERE RENAULT • NISSAN J OI Nt VENtURE COMPANY ~ "'"'"s'* (§J) TVS ~ mahindra swaRaJ TAFE ~ C: ~ H HONDA PIAGGIO V t HI <.. ~ I'V t . 1.11) , Ca se New Ho lla nd ~ .....,,..TVa U m lted <§;-j} BOSCH --- C. SODECI
Slide 20: Awards and Recognitions
Awards and Recognitions Teams from TPI participated in the SGA competition held by ABK AOTS in Aug’19 and won awards for quality improvement w.r.t. reducing surface defect rejection in tubular front forks Teams from TPI participated in the Zonal SMED Competition conducted by Automotive Component Man
Slide 21: Awards and Recognitions
Awards and Recognitions Teams from TPI participated in QCFI Convention in Sep’19 and won several awards 20
Slide 22: Business Highlights
Business Highlights Drop in Tubes and Strips volume due to slowdown of auto industry In spite of the drop in revenue due to difficult market conditions, profitability is maintained at the same level due to cost efficiencies and prudent revenue management Current focus is on operational efficie
Slide 23: Key Financials
Key Financials Rs. Cr Particulars 18-19 H1 18-19 H1 19-20 Growth % Net Sales 2,676 1,382 1,127 -18.4% PBIT 254 130 130 0.3% % to Net Sales 9.5% 9.4% 11.5% Particulars 31-03-2019 30-09-2018 30-09-2019 Net Fixed Assets 530 533 570 Net Working Capital 157 168 146 Capital Employed 687 702 717 Capital Ex
Slide 24: Key Financial Trends
Key Financial Trends Rs. Net Sales PBIT (before exceptional) Cr. 2,676 254 2,131 175 1,742 146 1,382 130 130 1,127 16-17 17-18 18-19 H1 18-19 H1 19-20 16-17 17-18 18-19 H1 18-19H1 19-20 ROCE 37% 37% 36% 26% 23% 16-17 17-18 18-19 H1 18-19 H1 19-20 23
Slide 25: Metal Formed Products (Chains, Fine Blanking, Doorframes and Railways)
Metal Formed Products (Chains, Fine Blanking, Doorframes and Railways) , RAILWAY COACHES Precision Value added Components 24
Slide 26: Product Profile
Product Profile Metal formed products division cater to both automotive and non-automotive segments as below: Business Mix Automotive: Two Wheeler drive chains, timing Railways chains and Sprockets for Auto-OEMs 11% and After Market Non Auto 21% Fine Blanked parts and door frames Auto 67% fo
Slide 27: Industry
Industry Automotive Sector H1 19-20: Two-Wheeler production de-grown by 13% Scooters : -16% Motor Cycles : -10% Passenger Vehicles production also de-grown by 16% Commercial Vehicles production registered a de-growth of 27% Non-Automotive Sector: Non-Automotive segment is driven by GDP g
Slide 28: Business Drivers
Business Drivers Auto OEM, Fine Blanked Products , Industrial Chains and Roll Formed Products • Adequate Capacity • Good push in the service • Quality, Consistency and reliability • Cost Competitiveness • Factories located closer to customer locations • New Product Development and Application Engine
Slide 29: Auto Chains – Industry and Customers
Auto Chains – Industry and Customers Industry Segments Two Wheeler Manufacturers (OEMs) Spare Parts Market – Auto Chains and Sprockets for Motor Cycles Key Customers: 28
Slide 30: Auto Chain Products
Auto Chain Products Drive Chain KIT CAM Chain After market brand 29
Slide 31: Fine Blanking – Industry and Customers
Fine Blanking – Industry and Customers Industry Two Wheeler – Motor Cycles and Scooters OEMs Segments Four Wheeler – Passenger and Commercial Vehicle OEMs and Tier-I Companies Industrial Applications 4W OEMs 4W Tier - I PHA Best Koki Customers 2W OEMs Industrial 30
Slide 32: Fine Blanking Products
Fine Blanking Products Engine Parts Transmission Parts Motor Cycle Engine and Transmission Parts Scooter Seat Parts Braking System Parts Seat Belt and Door Parts Steering Parts Transmission Parts Engine Parts Hood Parts 31
Slide 33: Roll Formed – Industry and Customers
Roll Formed – Industry and Customers Industry Four Wheelers - Passenger Car and Commercial Vehicle OEMs Segments and Tier-I Companies Two Wheelers - OEMs and Tier-I Companies Indian Railways - Coach Factories 32
Slide 34: Roll Formed - Products
Roll Formed - Products Four Wheelers Car Door Frames Divisional Channels Side Impact Beams Cowl Cross Beam Two Wheelers Motor Casings Railways 2W - Mudguard 33
Slide 35: Industrial Chains - Industry and Customers
Industrial Chains - Industry and Customers Key Customers Industry Segments Construction Equipment Manufacturers Material Handling ( Fork Lifts ) Agricultural Equipment Manufacturers Cement and Power Conveyer Manufacturers Food Processing Multi-level Car Parking 34
Slide 36: Industrial Chains - Products
Industrial Chains - Products Power Transmission and Conveying Chains Agricultural Chains Engineering Class Chains 35
Slide 37: Key Success Factors
Key Success Factors • Market leader in Drive and Cam chains in Auto OEM segment Segment Leader • Leader in Domestic Industrial Chains • Preferred supplier for Roll formed Door Frames • Significant player in Fine Blanking Components • Strategically located plants close to leading OEMs for JIT supplie
Slide 38: Metal formed - Key Success Factors
Metal formed - Key Success Factors Quality • PPM maintained lesser than customer target Technology • World Class High Speed Presses and Tools for Fine blanking, Chains and Motor casings • Catering to major 2W OEMs and Tier 1 Auto customers Customers • Industrial Chain OEMs in Domestic and Exports •
Slide 39: Metal formed – Industrial Chains
Metal formed – Industrial Chains Market Connect Initiatives IC Dealers’ Meet – Drive 2019 Kisan Mela – Industrial Summit Ludhiana 2019 – Haridwar 38
Slide 40: Metal formed – Awards and Recognition
Metal formed – Awards and Recognition Team from Industrial Chains recognised by ABK-AOTS/ QCFI- CCQCC 39
Slide 41: Metal formed – Awards and Recognition
Metal formed – Awards and Recognition Received award from MSIL for improvement in quality performance Award received from Alstom for new product development 40
Slide 42: Business Highlights
Business Highlights Focus on operational efficiency and quality improvements in auto chains Doorframe supplies to new projects commenced Obtained new orders for Railways Taken new initiatives under TQM Sale of Rotogro rotavators commenced by Agri division and focus on market ramp up Prod
Slide 43: Key Financials
Key Financials Rs. Cr Particulars 18-19 H1 18-19 H1 19-20 Growth % Net Sales 1,286 613 690 12.5% PBIT 123 57 74 30.3% % to Net Sales 9.6% 9.3% 10.7% Particulars 31-03-2019 30-09-2018 30-09-2019 Net Fixed Assets 336 296 339 Net Working Capital 114 122 123 Capital Employed 450 418 462 Capital Expendit
Slide 44: Key Financial Trends
Key Financial Trends Rs. Cr. Net sales PBIT (before exceptional) 1,286 123 1,095 102 996 88 690 74 613 57 16-17 17-18 18-19 H1 18-19 H1 19-20 16-17 17-18 18-19 H1 18-19 H1 19-20 ROCE 32% 26% 27% 27% 24% 16-17 17-18 18-19 H1 18-19 H1 19-20 43
Slide 45: Cycles and Accessories
Cycles and Accessories Pioneers in Promoting Cycling… not just cycles 44
Slide 46: Industry
Industry Overall Trade market has de-grown by Trade Sales 20% in H1 19-20 150% 100% Standard 63% 72% 50% In trade sales, the share of standard bicycles continues to come down. In 37% 28% 0% H1 19-20, volume of standard cycles Industry TII dropped by 20% in the industry. Standards Specials TI
Slide 47: Business Drivers
Business Drivers Cost competitiveness in Standard bicycles and entry level mass bicycles Product differentiation, Branding and Superior Service are key to success in premium bicycles Rapid increase in internet penetration throwing up new channels and opportunities Rising aspiration towards cycling i
Slide 48: Our Brands
Our Brands ·@BSA L A DYBIRD .HERCULES 'f.( RDADED 47
Slide 49: Key Success Factors
Key Success Factors • Innovation and differentiation in segments Pioneering through integrated headlights, anti – slip New Product chain etc. Development • 53 new models launched • Adoption of cycling as a life-style choice Promoting • Building a cycling community on-ground cycling as a with Track &
Slide 50: Key Success Factors
Key Success Factors • Market penetration of premium brands Roadeo Premium and Montra in multi brand stores Cycle • Representing International brands like Group Cannondale, Bianchi, Schwinn, Ridley (PCG) • Focus on product and technical training to grow secondary business of premium bicycles. • Retai
Slide 51: Renewed Retail Experience – Track and Trail
Renewed Retail Experience – Track and Trail Continuously expanding Track and Trail retail experience into more towns 50
Slide 52: Promoting Cycling
Promoting Cycling ~ BSA c .. • be.~»: 'I: • =.... ....... •""' · ,... ~ lt34 .; Alt'ltnil!c.-~·u ll.tnS'ICI"'"· f~•nt~~:a, 3\re ;.$.!J "'1(t '-"'11'-ii:H I"CIIII'f ~~ IWtr• .Wf p.....,.-e DOl.~Cfar'>X<f5 - w -·· ;auJ il .tg CH9 J!rhll... •10 c.-.:•lll'•e ""-HSI•:..•Tt&..tl:.up)l'l Teachers are like
Slide 53: Business Highlights
Business Highlights Gained overall Market Share by 2% YTD Sep’19 Implemented Fixed production plan (Toyota Planning System) at Ambattur plant which has helped in better throughput & effective Inventory management Warehouse consolidation initiative is being carried out Building for the future
Slide 54: Key Financials
Key Financials Rs. Cr Particulars 18-19 H1 18-19 H1 19-20 Growth % Net Sales 1,232 687 504 -26.7% PBIT 11 12 18 46.1% % to Net Sales 0.9% 1.8% 3.6% Particulars 31-03-2019 30-09-2018 30-09-2019 Net Fixed Assets 134 139 135 Net Working Capital 56 103 35 Capital Employed 190 242 171 Capital Expenditure
Slide 55: Key Financial Trends
Key Financial Trends Rs. Cr. Net sales PBIT (before exceptional) 1,332 1,294 36 1,232 687 18 504 11 12 0 16-17 17-18 18-19 H1 18-19 H1 19-20 16-17 17-18 18-19 H1 18-19 H1 19-20 ROCE 21% 12% 10% 6% 0% 16-17 17-18 18-19 H1 18-19 H1 19-20 54
Slide 56: Gears & Gear Products
Gears & Gear Products Shanthi Gears (SGL) - Strong Brand in Industrial Gears 55
Slide 57: Business Overview
Business Overview • Began operations in 1969 at Coimbatore SGL Shareholding Pattern - Sep'19 • Acquired by TII in 2012 Others • High Margin Business 21.33% FII 3.14% • Leader in custom-made gears & DII 5.06% Promoter loose gears (TII) 70.47% • ~70% of revenues come from customized products • Fully i
Slide 58: Integrated Gear Box Manufacturing Facility
Integrated Gear Box Manufacturing Facility State - of - the Art Gear Manufacturing facility In-House Heat Treatment Shop In- House Foundry (CI & (Case SG Iron) for carburising & Casing Gas Nitriding) Shanthi Gears In-House Fabricated Shop In House Non- with CNC Gas Ferrous Casing cutting along facil
Slide 59: Gear and Gear Boxes
Gear and Gear Boxes Spur/ Helical Pinion Shaft Internal Gear Worm and Straight Spiral Bevel Gear Wheel Bevel Worm Gearboxes- Worm Gearboxes- Worm Gearboxes- Adaptable Standard Special Helical Gearboxes Bevel Helical Gearboxes 58
Slide 60: Key Customers
Key Customers [>8 DAVID BROWN ~ BHARAT FORGE KALYANI VOITH KONEv~Es· Liftlna Busumsses SIEMENS TEREXW CATERPILLAR. Ill··~ .!.:____j -· .- . ~LI.:II PSG Ill-I-ll Clean Energy· 8 ••c•:r;•o••~H I . TATA o Clm TATASTEEL A AREVA uniGear DAVI08AOWN OAVIO BROWN 59
Slide 61: Business Highlights
Business Highlights Q2 Sales of Rs. 70 Cr. being 21% growth over PY; H1 Sales of Rs. 141 Cr. Service Business order book grown significantly compared to PY In roads for High Speed Gears in Turbine application Ramp-up in Helical segment 60
Slide 62: Key Financials
Key Financials Rs. Cr Particulars 18-19 H1 18-19 H1 19-20 Growth % Net Revenue 243 121 143 17.6% PBT 42 22 25 9.1% % to Net Revenue 17.5% 18.5% 17.2% PAT 33 18 18 1.8% % to Net Revenue 13.7% 14.4% 12.5% Particulars 31-03-2019 30-09-2018 30-09-2019 Net Fixed Assets 59 59 56 Net Working Capital 112 89
Slide 63: Key Financial Trends
Key Financial Trends Rs. Cr. Net Revenue PBT 243 43 214 184 33 29 143 22 25 121 16-17 17-18 18-19 H1 18-19 H1 19-20 16-17 17-18 18-19 H1 18-19 H1 19-20 ROCE 21% 14% 14% 11% 9% 16-17 17-18 18-19 H1 18-19 H1 19-20 62
Slide 64: Corporate Office and Disclaimer
Corporate Office: Tube Investments of India Ltd. "Dare House", 234 N S C Bose Road, Chennai - 600 001, India. +91 44 4217 7770 +91 44 4211 0404 info@tii.murugappa.com ------------------------------------------------------------------------Disclaimer----------------------------------------------
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