Eicher Motors Limited · NSE:EICHERMOT
Eicher Motors — Q2 FY2023-24 Earnings Presentation
79 slides from Eicher Motors's earnings presentation, Nov 10, 2023
Slide 1: Regulation 30 intimation to stock exchanges
November 10, 2023 Online intimation/submission The Secretary The Secretary BSE Limited National Stock Exchange of India Ltd Phiroze Jeejeebhoy Towers Exchange Plaza, 5th Floor, Plot No.C/1, Dalal Street G Block, Bandra Kurla Complex, Bandra (E) Mumbai-400 001 Mumbai-400 051 Security Code: 505200 Sym
Slide 2: Q2 FY 2023-24 Investor Presentation
EICHER MOTORS Q2 FY 2023-24 INVESTOR PRESENTATION November, 2023
Slide 3: Safe Harbour Statement
All statements included or incorporated by SAFE HARBOUR STATEMENT reference in this presentation, other than statements or characterizations of historical fact, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates, and projections about ou
Slide 4: Contents
CONTENTS 1. EML Overview 2. Royal Enfield ● Product ● Industry ● Business Performance ● Operations Overview ● Brand ● Sustainability 3. VECV 4. Financial Review INVESTOR PRESENTATION November 2023
Slide 5: Group Structure - Eicher Motors Ltd.
GROUP STRUCTURE - EICHER MOTORS LTD. Domestic Foreign Institutional Institutional Promoter Group Investors Investors Others 49.17% 30.27% 10.12% 10.44% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Eicher Motors Limited (EML) Joint Venture Business Unit 45.6% 54.4% Royal Enfield (RE) RENA (Royal Royal
Slide 6: EML Board
EML BOARD Leaders with proven track record S Sandilya Siddhartha Lal B. Govindarajan Vinod K. Aggarwal Chairman, EML Managing Director and CEO, EML CEO - Royal Enfield, Whole Time Non-Executive Director Director Inder Mohan Singh Manvi Sinha Subramanian Madhavan Tejpreet Chopra Independent Director I
Slide 7: Royal Enfield
ROYAL ENFIELD INVESTOR PRESENTATION 6 November 2023
Slide 8: Our Purpose
OUR PURPOSE Innovation for sustained Royal Enfield’s philosophy of Pure Ma exploration n rai Motorcycling has always been about a ch Ter constant search for balance between ine people, machine and terrain. Today, in a world out of sync with itself, we must SUSTAINABILITY extend this quest to our busi
Slide 9: Evolution of Our Company
EVOLUTION OF OUR COMPANY Royal Enfield is the global leader in the 250cc – 750cc, mid-weight motorcycles segment with our world-class motorcycles being among segment leaders, in India where we are ~90% of the midweight market, as well as in all key markets across Europe, Americas and the Asia-Pacific
Slide 10: Growth Focus ICE and EV, Sustainability
GROWTH FOCUS ICE AND EV Balance - Profit & Profitability Balance - EV as game changer along with ICE SUSTAINABILITY BRAND LED CX Balance - Social & Commercial Brand led Customer Experience objectives versus transactional focus CREATE AGILE, RESILIENT & TIMELESS BUSINESS STRATEGIC APPROACH INVESTOR PRE
Slide 11: Royal Enfield Management
ROYAL ENFIELD MANAGEMENT Team of Global Professionals Siddhartha Lal B. Govindarajan Mark Wells Mohit Dhar Jayal Simon Warburton Paolo Brovedani Mahesh Tripathi Managing Director & CEO, EML CEO – Royal Enfield Chief of Design Chief Brand Officer Chief Program Manager Chief of Product Development Chief
Slide 12: Product Portfolio
PRODUCT PORTFOLIO INVESTOR PRESENTATION November 2023
Slide 13: Iconic Timeless: Bullet, Classic
ICONIC TIMELESS BULLET 350 CLASSIC 350 INVESTOR PRESENTATION 12 November 2023
Slide 14: Cruiser: Meteor, Super Meteor
CRUISER METEOR 350 SUPER METEOR 650 INVESTOR PRESENTATION 13 November 2023
Slide 15: Roadster: Hunter, Interceptor
ROADSTER HUNTER 350 INTERCEPTOR 650 INVESTOR PRESENTATION 14 November 2023
Slide 16: Adventure: Himalayan, Scram
ADVENTURE HIMALAYAN SCRAM 411 INVESTOR PRESENTATION 15 November 2023
Slide 17: Cafe Racer: Continental GT
CAFE RACER CONTINENTAL GT 650 INVESTOR PRESENTATION 16 November 2023
Slide 18: Industry
INDUSTRY
Slide 19: Domestic Motorcycle Market
DOMESTIC MOTORCYCLE MARKET INVESTOR PRESENTATION 18 November 2023
Slide 20: Opportunity - Domestic Market
OPPORTUNITY - DOMESTIC MARKET Rising Income India Opportunity The expansion of the middle class and high-income 2 Wheeler: 21M Market segments will reshape future consumption and drive incremental Motorcycles: 13.5 M consumption of US$ 4 trillion by 2030 >125cc: 3.2M Source: World Economic Forum - F
Slide 21: Launch of Classic in 2009 Was an Inflection Point
LAUNCH OF CLASSIC IN 2009 WAS AN INFLECTION POINT Launch of “ New Classic 350” and “Scram 411” Launch of “650 Twins” Launch of “Hunter 350” Launch of and “Super Meteor 650” Launch of “Himalayan” Launch of “Continental GT” “Meteor 350” Launch of new “Thunderbird” and “Apparel and Accessories” Transit
Slide 22: Gaining Market Share in the >125cc Segment
GAINING MARKET SHARE IN THE >125cc SEGMENT INVESTOR PRESENTATION 21 November 2023
Slide 23: Global Mid-size Market is Underserved and a Huge Opportunity
Global Mid-size Market is underserved and is a huge opportunity Americas Market Share^ APAC Market Share EMEA Market Share 8% 9% 9% th G row ume Vol 1 Million+ Opportunity* 4.5x *Management estimate of the total middleweight motorcycle volumes in the priority markets for Royal Enfield. ^Reflects Royal
Slide 24: Business Performance
BUSINESS PERFORMANCE
Slide 25: Royal Enfield's Global Footprint
ROYAL ENFIELD’s GLOBAL FOOTPRINT UK Subsidiary India Tech Center Tech Center Manufacturing Canada Subsidiary South korea North America Japan Subsidiary Brazil CKD Thailand CKD Mexico (Dis) & Brazil Subsidiary & Thailand Subsidiary Subsidiaries - 05 Nepal (CKD) (Dis) Colombia (CKD) (Dis) CKD - 05 Mal
Slide 26: Expansive Premium Distribution Network in India
EXPANSIVE PREMIUM DISTRIBUTION NETWORK IN INDIA Store count ▪ Large stores North ▪ Studio stores 328 | 306 East West 236 | 222 200| 102 Chennai South ▪ Global Headquarters 330 | 293 ▪ Technology Centre ▪ Manufacturing Facilities • • Tiruvottiyur Oragadam Royal Enfield currently ranks #2 in the FADA D
Slide 27: Rapidly Growing International Network
RAPIDLY GROWING INTERNATIONAL NETWORK 1,050+ global touchpoints with 217 Exclusive stores & 836 MBOs Exclusive Multi Brand Exclusive Multi Brand Exclusive Multi Brand Store Outlet Store Outlet Store Outlet UK, MEA, Americas 98 214 69 512 APAC 50 110 Europe, Subsidiary - USA Technology Centers – UK A
Slide 28: Share of International Revenue Growing
SHARE OF INTERNATIONAL REVENUE GROWING Network Expansion and Touch Points International Business – Stellar Financial New Retail formats - Studio stores, Shop-in-shop for apparel, and motorcycle displays to increase Performance over last 7 years customer reach. Network expansion in key developing mar
Slide 29: Non-Motorcycle Business
NON-MOTORCYCLE BUSINESS Provide frictionless experience for RE Riders Non Motorcycle Business - 4X Revenue growth over the last six In Store Opportunity years in non motorcycle segment Accessories Apparel Explore new revenue pool from adjacencies In Use Opportunity Roadside Spares Assistance Annual
Slide 30: Building Capabilities to Cater to a Global Audience
BUILDING CAPABILITIES TO CATER TO A GLOBAL AUDIENCE In English Bruntingthorpe, UK Chennai, India World-class facilities midlands with with multiple Teams access to global working from product concept stage to development production Advanced capabilities and Engineering and EV ecosystem New Product t
Slide 31: EML - Stark Future Partnership
EML - STARK FUTURE PARTNERSHIP 01 Common tenets of long term vision 02 Deep understanding of EVs and connected - tech Technical Collaboration 03 Agreement - potential for joint development and sourcing 04 World class team - Faster product development Sourcing relationships 05 Sourcing relationships
Slide 32: Operations Overview
OPERATIONS OVERVIEW
Slide 33: Thiruvottiyur, Oragadam, Vallam
THIRUVOTTIYUR ORAGADAM VALLAM No Assembly 600,000 600,000 operations; Capacity Capacity Plating & motorcycles per motorcycles per Auto buffing annum annum INVESTOR PRESENTATION 32 November 2023
Slide 34: Best in Class Technology Delivering Superior Quality
BEST IN CLASS TECHNOLOGY DELIVERING SUPERIOR QUALITY VEHICLE ASSEMBLY ENGINE ASSEMBLY SURFACE FINISHING ▪ Assembly line flexibility - 256 SKUs ▪ Automation of critical sub assembly ▪ 46 robots deployed to achieve superior can be produced (including MiY) operations paint finish and better transfer ▪ Nu
Slide 35: Best in Class Technology Delivering Superior Quality
BEST IN CLASS TECHNOLOGY DELIVERING SUPERIOR QUALITY MACHINING FABRICATION AUTO BUFFING ▪ Total no of machining centers across ▪ Improved ride & handling experience ▪ Two stage automated buffing process plants - 340 achieved by 100% robotic welding of enhance the aesthetics of plating ▪ Process capab
Slide 36: Delivering the Pure Motorcycle Experience
DELIVERING THE PURE MOTORCYCLE EXPERIENCE Make It Yours - a unique motorcycle Studio Stores - Unique compact store Royal Enfield Vintage - Transparent sale personalization initiative format with 3S store offerings and purchase of pre-owned RE motorcycles Royal Enfield Garage Café, Goa - RE App - 3D co
Slide 37: Enhancing Consumer Experience
ENHANCING CONSUMER EXPERIENCE SALES SERVICE PRODUCT Field Failure – Defects per Hundred Bike 5X Redu DPHB ctio n 2016 2017 2018 2019 2020 2021 2022 Store and Online experience Service on Wheels & Ride Sure Product Quality Excellence ▪ Sales Process excellence ▪ The Ride Sure programme with a ▪ Valla
Slide 38: Brand
BRAND
Slide 39: The First Royal Enfield
1901 The first Royal Enfield motorcycle is produced. Designed by R. W. Smith and Frenchman Jules Gotiet, it hasa 11/2 hp Minerva engine mounted in front of the steeringhead. The final drive \s at the rear wheel by means of along rawhide bet. 1943 Royal Enfield produces large quantities of motorcycle
Slide 40: Launch of the 2023 Bullet 350
LAUNCH OF THE 2023 BULLET 350 “There is little doubt that the Bullet 350 has emerged as a brilliant upgrade. It is “The sentiment and aura Royal smoother to ride still looks retro and yet Enfield has cultivated are unlikely to offers most of the modern amenities.” wane anytime soon, as the recently l
Slide 41: Response to the 2023 Bullet 350
RESPONSE TO THE 2023 BULLET 350 INVESTOR PRESENTATION 40 November 2023
Slide 42: Brand Announcements
BRAND ANNOUNCEMENTS Royal Enfield Continental GT Cup 3rd Season dates Royal Enfield crosses the 2 lakh sales mark for announced the hunter 350 ● Announced the Royal Enfield Continental GT Cup ● Royal Enfield completed 2,00,000 sales mark for its Season ‘23 dates and registration details, India's compact
Slide 43: Brand Announcements
BRAND ANNOUNCEMENTS Royal Enfield strengthens Middle East Discover A New Path To Pure Motorcycling With presence with the appointment of AW Royal Enfield Rentals Rostamani Group as official distributor for ● Royal Enfield launched a first-of-its-kind Rentals programme, the UAE a unique initiative that pa
Slide 44: Apparel
APPAREL INTERNATIONAL BUSINESS STREETWIND ECO RIDING JACKET X Gaining Build Brand A new fit to momentum with a Awareness and cater to APAC footprint of over 70 credibility with and US regional markets overseas established global nuances apparel brands EXTENSION OF ONE’S PERSONALITY Inspired by the mo
Slide 45: Rides and Community
RIDES AND COMMUNITY Himalayan Odyssey One Ride Onam Ride Himalayan Zanskar The largest, fastest growing and the most engaged online motorcycle brand community in the world. On-ground and on-line communities come together to make a vibrant and eager audience INVESTOR PRESENTATION 44 November 2023
Slide 46: Motoverse 2023
MOTOVERSE 2023 Registrations Open Royal Enfield announced the Motoverse is a step into the Royal Through the announcement Royal dates for 13th edition of Enfield universe, with a vision to create Enfield aims to invite moto enthusiasts Motoverse 2023 inviting early a new-age pop culture calendar event
Slide 47: Leading Premium Consumer Brand
LEADING PREMIUM CONSUMER BRAND SHARE OF VOICE* NET SENTIMENT 45.6% 92% VS SHARE OF MARKET 7.4% *Share of Voice in the Global 2W Space Royal Enfield’s Market Share in the Indian Motorcycle Segment INVESTOR PRESENTATION 46 November 2023
Slide 48: Strong Brand Equity
STRONG BRAND EQUITY #1 86% Aspirational Consideration Brand #1 53% Top of Mind Awareness 31 percentage points ahead of our closest competitor 38 percentage points Community ahead of our closest competitor Driven ● Among the host of brand health metrics tracked by Royal Enfield, ‘Top of Mind Awareness
Slide 49: One of the World's Strongest Organic Social Media Communities
11 MILLION ONE OF THE WORLD’s STRONGEST FULLY ORGANIC SOCIAL MEDIA COMMUNITY INSTAGRAM LINKEDIN YOUTUBE FACEBOOK TWITTER INVESTOR PRESENTATION 48 November 2023
Slide 50: Total Engagement 168M
#BikeShedMotoShow #BikeShedMotoShow #BuildTrainRace #BuildTrainRace #BulletMeriJaan #BulletMeriJaan #Chandrayan3 #Chandrayan3 #ScramFest #ScramFest #OneRide2023 #OneRide2023 #ThisIsScramCity #ThisIsScramCity #Scram411 #Scram411 #StreetwindEcoRidingJacket #StreetwindV3 #SuperMeteor650 #RoyalEnfieldXRS
Slide 51: Awards
AWARDS CEO OF THE YEAR EXCELLENCE IN OPERATIONS SMART FACTORY OF THE YEAR Mr. B. Govindarajan Royal Enfield won three awards at the 11th Annual Manufacturing Today Awards' 2023. INVESTOR PRESENTATION 50 November 2023
Slide 52: Sustainability
SUSTAINABILITY
Slide 53: Pillars of Sustainability Journey
PILLARS OF SUSTAINABILITY JOURNEY Environmental Social Governance ▪ Become water positive ▪ Ride for a cause ▪ Strategy, execution and ▪ Attain Carbon neutrality ▪ Disaster relief activities monitoring ▪ Work towards zero liquid discharge ▪ Village upgradation programmes ▪ Risk management ▪ Eliminat
Slide 54: Green Business Operations
GREEN BUSINESS OPERATIONS Optimising Energy Consumption Emission Management 80% targeted emission ● Implementation of VFD in EPC AHU, ● Committed to reducing emissions 01 intensity reduction per helping reduce frequency (50 hz to 40 like PM, SOx, and NOx motorcycle by FY 29-30 hz) and power consumpt
Slide 55: Passion with Responsibility
PASSION WITH RESPONSIBILITY Women’s Safety and Gender Equality Awareness Helmet and Road Safety Awareness with the National Commission of Women ■ To promote the cause of helmet adoption and road safety ■ In an attempt to create a safe space and a gender-neutral through a unique initiative where art
Slide 56: Among the Industry Leaders in Sustainability Practices
AMONG THE INDUSTRY LEADERS IN SUSTAINABILITY PRACTICES Morgan Stanley Sustainalytics CapitalAmong International the top Among the top (MSCI) 10 Auto 10 Auto 13.3 COmpanies COmpanies globally Among globally the top 10 Among the top 10 - Low Risk auto companies auto companies Eicher Motors is listed i
Slide 57: Volvo-Eicher Commercial Vehicles
VOLVO-EICHER COMMERCIAL VEHICLES
Slide 58: Celebrating 15 Years: The Best of Both Worlds
Celebrating 15 years: The best of both worlds VISION AND VALUES Respect ▪ Global expertise Fair and To be recognised as the Ethical ▪ Leadership in product technology industry leader driving Excellenc modernization in e ▪ Well defined processes and controls commercial Customer ▪ Brand image transport
Slide 59: Q2 FY24 - Highest Ever Quarter Deliveries Across Segments
Q2 FY 24 - Highest ever quarter deliveries across segments • Highest ever second quarter sales of 19,551 units exceeding previous record of 18,696 units in Q2-FY’19 • HD Trucks (combined Volvo and Eicher) - Highest ever second quarter sales of 5,291 units (FY23 Q2 – 4,412 units) and market share of
Slide 60: India's Economy Anchored by Robust Domestic Demand and Investments
India’s economy anchored by robust domestic demand and investments ● IMF (International Monetary Fund) forecasts strong Indian GDP growth in FY24 at 6.3%. ● Government expenditure grew by 22.5% during April-July FY24, with capital expenditure +59.1% growth ● Tax revenues increasing -Sept’23 GST coll
Slide 61: Product Range - Seamless Transition to BS VI OBD II
Product range - Seamless transition to new BS VI OBD II emission standards INVESTOR PRESENTATION 60 November 2023
Slide 62: Creating a Strong Association with Our Uptime Centre
Creating a Strong & distinct association with our Uptime Centre INVESTOR PRESENTATION 61 November 2023
Slide 63: My Eicher ~200,000 Connected Vehicles
My Eicher ~200,000 connected vehicles CV Industry Leading App ➢ Single Window to monitor all Business KPI’s: Sales, Service, Spares, EOS, My Eicher, Soft Products. ➢ Actionable Insights to Review Operations: Model Wise Reporting, Manpower Productivity etc. ➢ On Demand Availability of Insights: Compa
Slide 64: e-mobility: Delivered India's First 5.5 T Electric Truck
e-mobility: Delivered India's first 5.5 T electric truck MoUs signed with Amazon India and Greencell Mobility for supply of 1000 electric trucks and buses respectively over next 5 years Advanced projects for Small Commercial Vehicles, Hydrogen ICE, Fuel Cells, Batteries, LNG and Bio-blends INVESTOR P
Slide 65: Dealer Satisfaction Award from FADA
Dealer Satisfaction - Won Dealer Satisfaction Award from Federation of Automobile Dealers Associations (FADA) for third year in row INVESTOR PRESENTATION 64 November 2023
Slide 66: Campaign Recognition - Three National Awards
Campaign recognition - Three National Awards for Excellence in Branding & Marketing Eicher Nayi Soch wins My Eicher wins Best New Eicher Uptime Beat wins Marketing Campaign of the Year Brand, Product or Service Marketing Excellence in CV Launch Award Industry INVESTOR PRESENTATION 65 November 2023
Slide 67: Brand Excellence Award
Brand Excellence Award - at 7th Business Leadership Awards by Indo-American Chamber of Commerce (IACC) INVESTOR PRESENTATION 66 November 2023
Slide 68: Strengthened Market Share in All Segments
Strengthened market share in all segments Light & Medium Duty Trucks Heavy Duty Trucks 33.8% 8.7% 25.3% 1.3% FY 2009 YTD FY24 FY 2009 YTD FY24 Buses Volvo Trucks India* 21.8% 94.0% 72.6% 5.3% FY 2009 YTD FY24 FY 2009 YTD FY24 *Market share in high end premium segment INVESTOR PRESENTATION 67 Novembe
Slide 69: Q2FY24 Financial Highlights
Q2FY24 FINANCIAL HIGHLIGHTS Total Revenue from Operations EBITDA^ and Margins Profit After Tax EBITDA – Earning Before Interest ,Tax, Depreciation and Amortisation ^For the purpose of EBITDA computation, only interest income (part of other income) has been excluded from Total Income The figures in %
Slide 70: Our Journey... Performing and Transforming
OUR JOURNEY… PERFORMING AND TRANSFORMING Profitable Sustainable Products & Operations Future Ready INVESTOR PRESENTATION 69 November 2023
Slide 71: Financial Review
FINANCIAL REVIEW
Slide 72: Inclusive Stakeholder Management Policies
INCLUSIVE STAKEHOLDER MANAGEMENT POLICIES With global operational and retail footprints and social initiatives that span the length and breadth of India and International markets, EML has a diverse stakeholder base Gunning for Improving Improving Value Growth Returns Creation ▪ Rise in utilization o
Slide 73: Significant Value Creation for All Stakeholders
SIGNIFICANT VALUE CREATION FOR ALL STAKEHOLDERS Market Capitalisation (INR Billions) 158x returns over last 14 years INVESTOR PRESENTATION 72 November 2023
Slide 74: Consistent Delivery Leading to Strong Cash Accruals
CONSISTENT DELIVERY LEADING TO STRONG CASH ACCRUALS Total Sales Total Revenue from operations EBITDA and Margin Motorcycle Volumes ('000) PAT Net Cash OCF Net Cash = Cash and cash equivalent – Total debt All figures are in INR Crs unless specified INVESTOR PRESENTATION 73 November 2023
Slide 75: Q2 FY24 Financial Highlights
Q2 FY24 FINANCIAL HIGHLIGHTS Total Sales Revenue from operations Motorcycle Volumes ('000) EBITDA and Margin PAT All figures refer to EML Consolidated numbers and are in INR Crs unless specified INVESTOR PRESENTATION 74 November 2023
Slide 76: Profit & Loss Statement (Consolidated)
PROFIT & LOSS STATEMENT (Consolidated) Profit and Loss Account FY19 FY20 FY21 FY22 FY23 H1FY24 Sales Volume: Two Wheelers (Nos.) 822,724 697,582 609,403 595,474 824,066 454,864 Total revenue from operations (net of excise) 9,797 9,154 8,720 10,298 14,442 8,101 Manufacturing and other expenses 6,894 6
Slide 77: Balance Sheet (Consolidated)
BALANCE SHEET (Consolidated) Particulars FY19 FY20 FY21 FY22 FY23 H1FY24 Net Fixed Assets (including CWIP and 2, 324 2,690 2,748 2,929 3.162 3,324 Pre-operative Expenditure) Investments 4,923 5,749 3,902 7,721 12,101 12,490 Other Non Current Assets 180 102 125 165 252 797 Current Assets Inventories
Slide 78: Statement of Cash Flows (Consolidated)
STATEMENT OF CASH FLOWS (Consolidated) Particulars FY19 FY20 FY21 FY22 FY23 H1FY24 Profit before tax and after share of profit 3,297 2,355 1,798 2,203 3,800 2,519 of Joint venture Operating profit before changes in working 2,941 2,236 1,912 2,172 3,552 2,150 capital Net Changes in working capital (457)
Slide 79: Royal Enfield
Royal Enfield Royal Enfield Royal Enfield INVESTOR PRESENTATION February 2023