Slide 1: Q1 FY18 – Investor Presentation
An Group Company Q1 FY18 – Investor Presentation August 3rd, 2017
Slide 2: Disclaimer
Disclaimer This presentation may include statements which may constitute forward-looking statements. All statements that address expectations or projections about the future, including, but not limited to, statements about the strategy for growth, business development, market position, expenditures,
Slide 3: Table of Contents
Table of Contents Section 1: RPG Group Overview 5-6 Section 2: Industry Overview 8-9 Section 3: Business Overview 11-23 Section 4: Operational & Financial Overview 25-32
Slide 4: Section 1: RPG Group Overview
Section 1: RPG Group Overview
Slide 5: RPG Group: Powered by Passion, Driven by Ethics
RPG Group: Powered by Passion, Driven by Ethics RPG Enterprises was founded in 1979 by Shri Rama Prasad Goenka, popularly known as RP UNLEASHTALENT Goenka, a pioneering fifth generation business leader from the Goenka family. The Goenkas have a history of business dating back to 1820 AD in banking,
Slide 6: RPG Group: Key Financials
RPG Group: Key Financials FY13-17 Net Revenue (Rs Cr) 19,297 EBITDA (Rs Cr) PAT (Rs Cr) 18,313 18,494 CAGR: 5.5% 17,364 FY13-17 CAGR: 2,016 2,053 15,567 EBITDA 14.1% PAT 26.7% 1,627 1,667 1,211 980 879 664 743 380 FY13 FY14 FY15 FY16 FY17 FY13 FY14 FY15 FY16 FY17 Net Worth (Rs Cr) ROCE ROE 25,000 Ma
Slide 7: Section 2: Industry Overview
Section 2: Industry Overview
Slide 8: Indian Tyre Industry
Indian Tyre Industry Total Tyre Production in India (Numbers in Lakhs) 1,462 1,520 1,254 1,228 1,289 1,273 FY 12 FY 13 FY 14 FY 15 FY 16 YTD DEC'16 April-December FY16 April-December FY17 0.8% 0.6% 10.9% 9.5% 38.6% 37.2% 25.3% 26.3% 6.4% 6.1% 14.2% 3.7% 16.3% 4.0% Source: Industry Sources 8
Slide 9: Indian Tyre Industry
Indian Tyre Industry Tyre Production in India (Numbers in Lakhs) MHCV (T&B) 165 165 171 168 161 121 FY 12 FY 13 FY 14 FY 15 FY 16 YTD DEC' 16 Passenger Car / Jeep 2 / 3 wheeler 387 357 799 321 317 335 760 287 671 634 681 591 FY 12 FY 13 FY 14 FY 15 FY 16 YTD DEC' 16 FY 12 FY 13 FY 14 FY 15 FY 16 YTD
Slide 10: Section 3: Business Overview
Section Section3:4:Business BusinessOverview Overview
Slide 11: Board of Directors
Board of Directors Hari L. Mundra Harsh Vardhan Goenka Anant Vardhan Goenka Arnab Banerjee Non Executive Chairman, Non Executive Director Managing Director Whole -Time Director Non Independent Director Atul C. Choksey Haigreve Khaitan Mahesh S. Gupta Paras K. Chowdhary Non Executive Non Executive No
Slide 12: Leadership Team
Leadership Team Anant Goenka Kumar Subbiah Arnab Banerjee Milind Apte Executive Director Senior Vice President Managing Director Chief Financial Officer - Operations - Human Resources Tom Thomas Dilip Modak Chandrashekhar Ajgaonkar Peter Becker Executive Director Senior Vice President Senior Vice Pr
Slide 13: Overview
Overview India’s leading tyre company with over 50 yrs of presence Distribution Network : 4,500+ dealers, 450+ exclusive CEAT franchisees 6 Manufacturing facilities - Bhandup, Nasik, Halol, Nagpur, Ambernath & Sri Lanka 100+ countries where products are sold with strong brand recall #No 1 player in
Slide 14: Strategy
Strategy 1 Differentiated Products Two wheelers Domestic 2 Strong Brand Passenger cars & Market Utility vehicles 3 Extensive Distribution Profitable growth 4 Deep OEM Partnerships International Off Highway Tyres Market Emerging markets 5 World Class R&D 6 Expanding Global Reach 14
Slide 15: Differentiated Products
1 Differentiated Products New Entries and Primary Supplier to OEM’s Key developments Focus on OEM, recent entries in new models – Honda Cliq, Ashok Leyland Stag and Partner, Tork T6X, Hero Motocorp Achiever 150, Renault Kwid, M&M TUV 300, RE Himalayan, Honda Navi, Bajaj Vikrant V15, Hero Splendor
Slide 16: Strong Brand
2 Strong Brand First-of-its-kind digital advertising campaign. Ad1 | Ad2 | Ad3 Title sponsor for Ultimate Table Tennis Association with Renault Gang of Dusters (G.O.D) CEAT’s new TVC ‘Nehlau’ – TVC Video Link 16
Slide 17: Extensive Distribution
3 Extensive Distribution Shoppe Shop in Shop (SIS) Distribution Network 4,500+ dealers 450+ CEAT Franchisees (Shoppes + Hubs) 250+ two-wheeler distributors Developed Multi Brand Outlet / Shop in Shop model over last 2 years. Over 350+ outlets so far Launched CEAT Bike Shoppes in Bangalore
Slide 18: Deep OEM Partnerships
C=AT RPG @ Deep OEM Partnerships . iid @® = VE COMMERCIAL VEHICLES = . A VOLVO GROUP AND EIGHER MOTORS JOINT VENTURE TATA Ashok Leyland : “ees ESCORTS : GD ® <= @AMW saees: Mahindra DAIMLER EICHER BUILT TO WIN : ms eA @D &® & --5 Sa MARUTI ry Suzuki wmorrs Mahindra Wy UNDAI MOTORS ae RENAULT Ey SS B
Slide 19: World Class R&D
5 World Class R&D New Products Developed 102 95 92 66 70 FY13 FY14 FY15 FY16 FY17 State of the art R&D facility at Halol plant R&D focussed on development of breakthrough products, alternate materials, green tyres & smart tyres Partnerships with global institutes and technology partners Incr
Slide 20: Expanding Global Reach
6 Expanding Global Reach Key Export Clusters Emerging markets Europe Cluster Sri Lanka: Leadership position with US Cluster 50+% market share Middle East Cluster Focused product ASEAN and distribution West Africa East Africa Cluster strategy for LATAM Cluster Cluster select clusters Cluster 20
Slide 21: Revenue: Passenger Segment Trends
Passenger Segment Trends 2/3 wheelers (Rs Cr) PC / UV (Rs Cr) 743 1,648 1,483 619 561 Revenue 1,246 476 899 376 639 284 525 445 201 FY 12 FY13 FY 14 FY 15 FY 16 FY 17 Q1 FY 18 FY 12 FY13 FY 14 FY 15 FY 16 FY 17 Q1 FY 18 Nagpur plant commissioned 67 MT/day capacity as of June 2017; total capacity o
Slide 22: Off Highway Tyres
Off Highway Tyres Status Update Greenfield OHT (Off Highway Tyres) radial plant in Ambernath Investing INR 330 Crs for a Phase 1 capacity of 40 MT/day which will be further ramped up to 100 MT/day Plant is now live and tyres are being tested across multiple global markets 22
Slide 23: Strategic Focus Areas – Continued Momentum
Strategic Focus Areas – Continued Momentum Strategic Focus Areas (Passenger Segment, Specialty Others Exports & Emerging Markets) 54% 51% 57% 61% 80% 68% CAGR of 25% Substantial contribution towards increasing profitability 46% 49% 43% Strategic 39% 32% Focus Areas 20% Market share growing FY
Slide 24: Section 4: Operational & Financial Overview
Section Section4:5:Operational Operational&&Financial Financial Overview Overview
Slide 25: Q1 FY18 Operational Highlights
Q1 FY18 Operational Highlights Products OEM entries Launch of “Aayushmaan Plus” range of puncture protected tractor tyres Honda Cliq VE Commercial Vehicles Escort Tractor 25
Slide 26: Consolidated: Q1 FY18 Financial Highlights
Consolidated: Q1 FY18 Financial Highlights Q1 FY18 v/s Q4 FY17 (Q-o-Q) Q1 FY18 v/s Q1 FY17 (Y-o-Y) Net revenue from operations declined by 0.8% at INR Net revenue from operations declined by 0.7% at INR 1,460 1,460 Crs from INR 1,472 Crs Crs from INR 1,470 Crs Gross margins have contracted to
Slide 27: Consolidated: Financial Trends – Revenue growth
Consolidated: Financial Trends Revenue growth 5,508 5,705 5,447 5,722 5,009 4,614 Net Sales (Rs Cr) 1460 FY 12 FY 13 FY 14 FY15 FY16 FY17 Q1 FY18 14.9% 12.0% 11.9% 11.9% Margin trends 809 680 685 EBITDA (Rs Cr) 8.7% 658 5.9% 438 EBITDA to Net 4.0% Sales % 274 58 FY 12 FY 13 FY 14 FY15 FY16 FY17 Q1 F
Slide 28: Consolidated: Financial Trends – PAT and Return Ratios
Consolidated: Financial Trends 8.0% PAT trends 5.6% 438 361 PAT (Rs Cr) 4.9% 317 6.3% 2.4% PAT to Net 271 0.4% 0.1% Sales% 18 120 1 FY 12 FY 13 FY 14 FY15 FY16 FY17 Q1 FY18 30% Return Ratios 25% ROE (%) 23% 16% 16% ROCE post tax 18% 17% 17% (%) 13% 11% 8% 1.4% 3% 0.2% FY 12 FY 13 FY 14 FY15 FY16 FY1
Slide 29: Consolidated: Q1 FY18 Financials
Consolidated: Q1 FY18 Financials INR Cr Parameter Q1FY17 Q4FY17 Q1FY18 QoQ YoY Net Revenue from operations 1,470 1,472 1,460 -0.8% -0.7% Raw Material 836 925 961 3.9% 14.9% Gross margin 634 547 499 -8.7% -21.3% Gross margin % 43.1% 37.1% 34.2% -290 bps -890 bps Employee 96 105 100 -4.2% 4.5% Other E
Slide 30: Consolidated: Leverage / Coverage Profile
Consolidated: Leverage / coverage Profile Total Debt 681 770 834 924 1037 (INR Cr) 0.4 ST Debt (Rs Cr) 0.4 108 Debt breakup 0.4 0.3 72 0.3 58 929 99 852 LT Debt (Rs Cr) 50 776 631 672 Total Debt / Equity Q1 FY 17 Q2 FY 17 Q3 FY 17 Q4 FY 17 Q1 FY 18 Leverage ratios 196 194 EBITDA (Rs 158 Cr) 11.9 137
Slide 31: Standalone: Q1 FY18 Financials
Standalone: Q1 FY18 Financials INR Cr Parameter Q1FY17 Q4FY17 Q1FY18 QoQ YoY Net Revenue from operations 1,456 1,451 1,451 0.0% -0.3% Raw Material 834 912 965 5.8% 15.8% Gross margin 622 539 486 -9.8% -21.9% Gross margin % 42.7% 37.1% 33.5% -360 bps -920 bps Employee 90 99 96 -2.7% 6.3% Other Expens
Slide 32: Equity Shareholding & Price Trends
Equity Shareholding & Price trends 2,000.0 Close Price (Rs) Total Volume 1,852 4,500,000 1,800.0 4,000,000 1,600.0 3,500,000 1,400.0 3,000,000 Returns since August’ 16 1,200.0 864 2,500,000 1,000.0 800.0 2,000,000 CEAT: 114% 1,500,000 600.0 400.0 1,000,000 NIFTY: 16% 200.0 500,000 0.0 - Aug/16 S
Slide 33: Thank You
T H A N K Y O U