Eicher Motors Limited · NSE:EICHERMOT
Eicher Motors — Investor Presentation (May 2022)
76 slides from Eicher Motors's investor presentation, May 13, 2022
Slide 1: Regulation 30 Investor Presentation Intimation Letter
May 13, 2022 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 Symbol:
Slide 2: Investor Presentation May 2022
Investor Presentation May 2022 INVESTOR PRESENTATION May 2022
Slide 3: Contents
Contents 1 EICHER MOTORS LIMITED – OVERVIEW 2 ROYAL ENFIELD 3 VE COMMERCIAL VEHICLES LIMITED 4 ESG 5 FINANCIALS Note: The Company followed “January-December” as its reporting year till December 2014. The Board of Directors in its meeting held on February 13, 2015 decided to align the reporting year
Slide 4: Eicher Motors Limited
Eicher Motors Limited INVESTOR PRESENTATION May 2022 3
Slide 5: Eicher Motors Ltd. (EML) - Group Structure
Eicher Motors Ltd. (EML) - Group Structure Promoter Group Domestic Foreign Institutional Others Institutional Investors Investors 49.21% 29.22% 9.95% 11.62% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Eicher Motors Limited (EML) Joint Venture with Volvo Group Business Unit 45.6% 54.4% Royal Enfield
Slide 6: Royal Enfield
INVESTOR PRESENTATION May 2022 5
Slide 7: Global leader in the middleweight motorcycle segment
Global leader in the middleweight motorcycle segment; Poised to become the first premium global consumer brand from India Royal Enfield is the global leader in the 250cc – 750cc, mid-segment motorcycles. With ~90% market share in the Indian mid-size segment, we have rapidly grown our presence across
Slide 8: Launch of the Classic in 2009 was an inflection point
Launch of the Classic in 2009 was an inflection point Volumes grew by ~22% CAGR between CY-2010 to FY-2018, prior to significant external headwinds Replacement opportunity awaits as most of the sales While FY2021-22 volumes were impacted due to COVID-19 happened in the past 7 years and production co
Slide 9: Significant Value Creation for all stakeholders
Significant Value Creation for all stakeholders Market Capitalisation (INR Billions) 112x returns over last 13 years Source: Capital IQ INVESTOR PRESENTATION Excluding dividends May 2022 8
Slide 10: Global
Global INVESTOR PRESENTATION May 2022 9
Slide 11: Opportunity – Domestic Market
Opportunity – Domestic Market India to become a US$6.5 trillion economy by 2030 India’s favorable demographics Indian Economy: A shift to a high growth path By 2031, the working age population i.e. 20-59 years is poised to increase by 300bps Source: Economic Survey 2019-20 Rising income Many India’s
Slide 12: Established Premium Brand in India with expansive distribution network
Established Premium Brand in India with an expansive premium distribution network 1,063 stores and 1,055 studio stores across ~1,750 cities Dealer Network Store count ▪ Large stores ▪ Studio stores ars 7 ye North 4x in 332 | 360 East 203 | 231 West 217 | 178 City Category wise Distribution Category*
Slide 13: Global mid-size motorcycle market is underserved
Global mid-size motorcycle market is underserved and is a huge opportunity The Oddity of the Motorcycle Industry Globally… is an opportunity CAGR:2012-18 Developing Motorcycles Most > Markets 750cc -2% Industry Industries 250-750cc 3% Premium RE is driving upgrade along -2% with premiumisation in In
Slide 14: Brand, product and network drivers for global expansion
Global mid-size motorcycle market is underserved and is a huge opportunity BRAND PRODUCT NETWORK ▪ Strong brand salience ▪ Strong pipeline of new ▪ Focused approach for coupled with equity as products for next 5 international market a premium and years and beyond for expansion desirable brand the gl
Slide 15: Building capabilities to cater to global audience
Building capabilities to cater to global audience Bruntingthorpe, UK New Product Chennai, India Introduction (NPI) In English midlands with access framework in place to to global product development develop best-in-class capabilities and ecosystem products in an optimal timeframe World-class facilit
Slide 16: Rapidly growing international network
Rapidly growing international network 840+ global touchpoints with 165 Exclusive stores & 670+ MBOs Developed Markets Developing Markets Multi Multi Exclusive Exclusive Brand Brand Store Store Outlet Outlet North APAC 48 100 1 139 Countries with exclusive stores America ■ Australia* – 1 ■ New Zealan
Slide 17: Share of revenue from international markets has grown over 5x
Share of revenue from international markets has grown over 5x over the last 7 years Network Expansion and Touch Points International Business – Stellar Financial Performance over last New Retail formats - Studio stores, Shop-in-shop for apparel, and 7 years motorcycle displays to increase customer r
Slide 18: Motorcycling
Motorcycling INVESTOR PRESENTATION May 2022 17
Slide 19: Product Portfolio – Expanding presence in mid-weight segment
Product Portfolio – Expanding presence in mid-weight segment Royal Enfield motorcycles are able to address a unique mix of appeals – from its traditional customer base to urban, aspiration-driven youth Bullet 350 Classic 350 Meteor 350 Scram 411 Himalayan Continental Interceptor GT 650 650 ▪ Oldest
Slide 20: All-new Classic 350: Setting New Benchmarks
All-new Classic 350: Setting New Benchmarks Royal Enfield range of motorcycles is able to address a unique mix of appeals – from its traditional customer base to urban, aspiration-driven youth Positive Adoption and Extended with a host of Leader in premium segment Engagement by Customers Accessories
Slide 21: All New Scram 411: The versatile ADV Crossover
All New Scram 411: The versatile ADV Crossover Unveiled for global audiences with retail Expanding Royal Enfield Adventure availability in India, and to debut in Europe portfolio, complementing Himalayan ADV and APAC by mid of 2022 "The SCRAM is a motorcycle “A proper Scrambler and a "Scram 411 is d
Slide 22: Scram 411: Vibrant colorways and accessories
Scram 411: Vibrant colorways and wide range of accessories What sets the All New Scram 411 apart? The all new Scram 411 is available in 7 different colour combinations INVESTOR PRESENTATION May 2022
Slide 23: Best-in-Class Technology Delivering Superior Quality
Best-in-Class Technology Delivering Superior Quality Royal Enfield range VEHICLE of motorcycles is able to address ASSEMBLY ENGINEa unique mix of appeals – ASSEMBLY SURFACE FINISHING from its traditional customer base to urban, aspiration-driven youth ▪ SRK methodology for new products ▪ Automated c
Slide 24: The quest for enhancing consumer experience
The quest for enhancing consumer experience SALES SERVICE PRODUCT Field Failure – Defects per Hundred Bike 5X Re du DPHB ctio n 2016 2017 2018 2019 2020 2021 Store and Online experience Service on Wheels & Ride Sure Product Quality Excellence ▪ Sales Process excellence ▪ The Ride Sure programme with
Slide 25: Enhancing the pure motorcycling experience
Enhancing the pure motorcycling experience Studio Stores Royal Enfield Vintage Make It Yours - a unique Unique compact store format with Transparent sale and purchase motorcycle personalization 3S store offerings of pre-owned RE motorcycles initiative Royal Enfield Garage RE App Royal Enfield Café,
Slide 26: Make It Yours - A Royal Enfield. Made by you, for you
Make It Yours - A Royal Enfield. Made by you, for you Personalise your motorcycle from Day 1. Make it the way you want from style, safety to comfort ` Personalise your Give it a unique look Cover endless miles motorcycle your way with added comfort Cruise your own way. Get the joy of a From Day 1. p
Slide 27: Make It Yours - Apparels
Make It Yours - Apparels Royal Enfield Introduces Make-it-yours Initiative On Apparel First-of-its-kind personalization tool, the Royal Enfield Close to 7,000 unique options to choose from for customizing Make It Yours, now available across the brand’s range of helmets and over 15,000 unique options
Slide 28: Rides and Community
Rides and Community Continental GT Cup One Ride ▪ In October 2021, Royal Enfield marked its maiden ▪ The 10th edition of One Ride was organised across 35 foray into modern motorsports, with the first edition countries on 26th September 2021, with strict of the Continental GT Cup 2021 - racing at its
Slide 29: BSF x RE: Seema Bhawani Shaurya Expedition
BSF x RE: Seema Bhawani Shaurya Expedition Flagged of on the occasion of International Women’s Day in Celebrating our long association with BSF, for a one of March 2022, the expedition saw 36 members of BSF Seema its kind, all women riding expedition- the Seema Bhawani All-Women Daredevil Motorcycle
Slide 30: 90° South: Our successful expedition to the South Pole
90° South: Our successful expedition to the South Pole A 28-day journey traversing A tribute to the brand’s commitment to Successfully completed 90° South - Antarctica on a 400 km ride from 87° pure motorcycling, and to the courage and A first-of-its-kind motorcycle South to the South Pole, on resil
Slide 31: Expanding the Pure Motorcycling Ecosystem
Expanding the Pure Motorcycling Ecosystem Provide frictionless experience for RE Riders Explore new revenue / profit pool from adjacencies In Store Opportunity In Use Opportunity Road Side Spares Assistance Annual Extended Maintenance Warranty Contract Accessories Apparel Solutions Business - Financ
Slide 32: Product Portfolio – Apparel
Product Portfolio – Apparel ALPINESTARS x RE ART OF MOTORCYCLING - SEASON 2 A riding apparel collection created for those who live to chase Conceptualized a platform catering to artists, designers, adventures. The range brings you the motorcycling legacy, illustrators and motorcycle enthusiasts to e
Slide 33: Brand
Brand INVESTOR PRESENTATION May 2022 32
Slide 34: EICMA 2021
EICMA 2021 SG 650 LIMITED EDITION 120 YEAR TWINS PROJECT ORIGIN Debuted the 120th Year Anniversary Edition with the 650 Opened at EICMA 2021 with an Twin, the Interceptor 650 and the Continental GT 650; and Showcased a major centre-piece of our unveiling of the SG650 Concept received an overwhelming
Slide 35: Oldest Motorcycle Brand in Continuous Production
Oldest Motorcycle Brand in Continuous Production INVESTOR PRESENTATION May 2022 34
Slide 36: Engage Physically... Propagate Digitally
Engage Physically... Propagate Digitally Himalayan Riders Club Of Rider Mania Slideschool One Ride Odyssey Europe Continental GT Seema Bhawani 90° South Cup Shaurya Expedition The largest, fastest growing Strong global digital On-ground and on-line and the most engaged community with very high ‘Digi
Slide 37: Building a strong digital community
Building a strong digital community Seema Bhawani International GT Cup x Scram 411 Shaurya Expedition Women's Day Motorsports Launch Total Average Total Reach* Engagement Engagement per 2,342 M 114 M Brand post 7,791 Art of Motorcycling Total Views Engagement Classic 350 Sands of Time S2 1,106 M Rat
Slide 38: Hybrid Engagement Leading to Strong Consumer Equity
Hybrid Engagement Leading to Strong Consumer Equity #1 85% Consideration #1 48% Top of Mind Awareness 2,200 bps ahead of our closest competitor 2,100 bps ahead of our *Internal Millward Brown Brand Health closest competitor Report with sample size of ~3200) ▪ Among the host of brand health metrics t
Slide 39: Business Performance
Business Performance INVESTOR PRESENTATION May 2022 38
Slide 40: Consistent Delivery leading to strong cash accruals
Consistent Delivery leading to strong cash accruals All figures are in Rs. Crs unless specified Sales Volume Market Share* (India) Total Revenue (in Thousands) Total revenue from operations (net of excise duty) EBITDA and Margins Profit After Tax Net Cash Net Cash = Cash and cash equivalent – Total
Slide 41: Steps taken to mitigate short term supply chain challenges
Strong steps taken to mitigate short term supply chain challenges Challenge Mitigation Semiconductor Component Shortage - Working closely with parts and electronic component suppliers to ensure accurate Acute shortages of electronic components (ICs, forecasting of component deliveries alongisde micr
Slide 42: Multiple Management Actions Taken to Optimize Cost Base
Multiple Management Actions Taken to Optimize Cost Base Business Material Employee Fixed Marketing Top Line Cost Cost Overhead Spend s Selling Price Material Cost control People Cost ▪ Restricted travel & ▪ Sharper Digital reset actions: initiatives: Initiatives: training resulted in marketing ▪ Ini
Slide 43: Awards and Achievements
Awards and Achievements All-New CLASSIC 350 BEST OF 2021 VIEWER’S CHOICE BIKE MOTORCYCLE OF THE YEAR OF THE YEAR RETRO BIKE OF MODERN CLASSIC BIKE BEST MODERN CLASSIC THE YEAR OF THE YEAR (LIGHTWEIGHT) METEOR 350 RETRO BIKE OF BEST BEGINNER COOLEST MOTORCYCLE OF THE YEAR MOTORCYCLE THE YEAR BEST MOD
Slide 44: RE in Summary
RE in Summary Poised to become the first premium global consumer brand from India Strong Brand Best-in-Class Extensive Non Products Network Motorcycle Solution Processes and systems People Sustainability: ESG INVESTOR PRESENTATION May 2022 43
Slide 45: VE Commercial Vehicles Limited
INVESTOR PRESENTATION May 2022 44
Slide 46: What drives us….Vision & Values
What drives us….Vision & Values To be recognised as the Respect industry leader driving Fair and Ethical modernization in commercial Excellence transportation in India Customer Centric and the developing world Passion INVESTOR PRESENTATION May 2022 45
Slide 47: Businesses…Eicher Trucks and Buses, Volvo Trucks & Buses
Businesses…Eicher Trucks and Buses, Volvo Trucks & Buses in India, Drivelines and Components Eicher Trucks VECV Bus Division Engineering Engines & Drivetrain Volvo Trucks Components INVESTOR PRESENTATION May 2022 46
Slide 48: Joint Venture since 2008… Merging the best of both worlds
Joint Venture since 2008… Merging the best of both worlds ▪ Global expertise ▪ Leadership in Light & Medium Duty segments ▪ Leadership in product technology ▪ Frugal engineering & operations ▪ Well defined processes and controls ▪ After sales infrastructure ▪ Brand image ▪ Cost effective operations
Slide 49: VECV JV Capability and Market Position strengthened over 13 years
VECV JV Capability and Market Position strengthened over past 13 years… Successful synergies based on trust, mutual respect & win-win 2008-2013 JV formation and initial 2013-2020 2021 > Next step synergies Synergy projects Wave 2 Synergy -Commercial focus ▪ Product development initiatives ▪ Launched
Slide 50: Strengthened market share in all segments driven by modernisation
Strengthened market share in all segments driven by modernisation Light & Medium Duty Trucks Heavy Duty Trucks 29.3% 6.6% 25.3% 1.3% FY 2009 FY 2022 FY 2009 FY 2022 Buses Volvo Trucks India* 21.6% 83.9% 5.3% 72.6% FY 2009 FY 2022 FY 2009 FY 2022 *Market share in high end premium segment INVESTOR PRE
Slide 51: Consistent financial performance despite headwinds
Consistent financial performance despite headwinds All figures are in Rs. Crs unless specified Total CV# Volumes and Market Share Total Revenue (in nos and %) Total revenue from operations (net of excise duty) EBITDA^ and Margins Profit After Tax CV# - Commercial Vehicles EBITDA – Earning Before Int
Slide 52: Eicher BSVI Product Portfolio…Renewed range
Eicher BSVI Product Portfolio…Renewed range. Broad application segment coverage ANGE Sub 5T – 16T LMD R 4.9T to 16T Haulage 2.8CuM to 6.5CuM Tippers 18.5T to 55T NGE 18.5T to 47.5T Haulage HD RA 7 CuM to 32 CuM Tippers/ Tip Trailers 39.5T to 55T Tractor Trailers 12 – 62 Seater Starline (School, Staf
Slide 53: VECV Bus Division…Shaping the future of Indian Bus Industry
VECV Bus Division…Shaping the future of Indian Bus Industry Volvo Buses + Eicher Buses Distinct Comprehensive Offer Eicher & Volvo Brands New Markets & E-Mobility Transferred Volvo Buses India operations and people into VECV in 2020 to create an industry leader INVESTOR PRESENTATION May 2022 52
Slide 54: New Inter-city Luxury Coach & Sleeper Platform
Eicher Establishes New Standard In Inter-city Luxury Bus Travel With New Coach & Sleeper Platform INVESTOR PRESENTATION May 2022 53
Slide 55: Electric range… 9m bus for city application
Electric range… 9m bus for city application ready for commercialization INVESTOR PRESENTATION May 2022 54
Slide 56: Volvo Trucks India Introduced Next Generation Trucks
Volvo Trucks India Introduced Next Generation Trucks New Range of Volvo FM and FMX trucks introduced catering to the mining, construction & infrastructure and on-road transportation segments Volvo FY22 market share ~84% INVESTOR PRESENTATION May 2022 55
Slide 57: Manufacturing… enhanced with Volvo buses and Industry 4.0 Bhopal plant
Manufacturing… enhanced with Volvo buses and Industry 4.0 Bhopal plant Vehicle Assembly plant - Bhopal Eicher Engineering Components – Unit I & II Truck Plant-Pithampur – Dewas Plant Truck Plant-Bhopal VE Powertrain – Pithampur Industrial Gear Box for Chassis Assembly Line - Bhopal Export (SEZ) – Pi
Slide 58: Strengthening distribution and service reach
Strengthening distribution and service reach….#1 in Dealer Satisfaction #1 in Dealer Satisfaction* 660+ network count *Federation of Automobile Dealers Associations (FADA) Survey 2021 INVESTOR PRESENTATION May 2022 57
Slide 59: Leading in Digitization…driven by 100% connected vehicle fleet
Leading in Digitization…driven by 100% connected vehicle fleet Digital Customer Digital Business Digital Enterprise INVESTOR PRESENTATION May 2022 58
Slide 60: Awards and Accolades
Awards and Accolades CV of the Year ICV Cargo Carrier Of The Year awarded to Received Apollo CV Award for LCV- ICV People Mover of the Eicher Pro 2114 XP CNG Year for Skyline Pro 3010 L CNG staff bus Volvo 9400 B8R 13.5m Coach won the Coach Of The Year at Apollo CV Awards INVESTOR PRESENTATION May 2
Slide 61: ESG
ESG INVESTOR PRESENTATION May 2022 60
Slide 62: Themes for Sustainability Journey
Themes for 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 63: Sustainability Efforts Gather Steam
Sustainability Efforts Gather Steam DJSI Inclusion Sustainability 4.0 Award 2021 In November 2021, Eicher Motors Limited made its debut In December 2021, Royal Enfield (A Unit of Eicher Motors on Dow Jones Sustainability Index (DJSI) 2021 - Emerging Limited) was recognized with the "Challengers Awar
Slide 64: Green Business Operations
Green Business Operations Energy and Emissions Conservation, efficiency, renewable energy, reduced emissions Minimise emission in raw material extraction and Reduce production amount of waste to Material Water and Effluent landfill EML Recycled material and Recyclable EML Rainwater Harvesting ZLD, m
Slide 65: Passion with Responsibility
Passion with Responsibility India USA Europe Committed to drive an active agenda towards Committed to support the affected communities the sustainability and the environment at large during the pandemic ■ Royal Enfield announced its partnership with Helmets For India; aimed ■ India: Rs. 60 Crs were
Slide 66: EML Board: Leaders with proven track record
EML Board: Leaders with proven track record S Sandilya Siddhartha Lal B. Govindarajan Chairman- Non-Executive and Managing Director and CEO, CEO - Royal Enfield, Whole Independent Director EML Time Director Vinod K. Aggarwal Inder Mohan Singh Manvi Sinha Non-Executive Director Independent Director I
Slide 67: Royal Enfield managed by seasoned professionals
Royal Enfield managed by seasoned professionals Siddhartha Lal B. Govindarajan Kaleeswaran Mark Wells Mohit Dhar Jayal Managing Director and CEO, CEO – Royal Enfield Arunachalam Chief of Design Chief Brand Officer EML Chief Financial Officer Sudhakar Simon Warburton Rajeev Sharma Paolo Brovedani Chi
Slide 68: VECV Board…Proven track record of value delivery
VECV Board…Proven track record of value delivery Siddhartha Lal Joachim Rosenberg Vinod Aggarwal Chairman of the Board Jan Gurander EVP Volvo Group Managing Director & CEO MD Eicher Motors Ltd Deputy CEO Volvo Group President Volvo Energy VECV Philippe Divry Raul Rai Lila Poonawalla Inder Mohan Sing
Slide 69: VECV Management … Deep experience in Indian & Global CV industry
VECV Management … Deep experience in Indian & Global CV industry BK Bindiganavile SVP Strategy, Brand & Finance, Legal & Communication Audit Vinod Aggarwal MD & CEO Sudeep Dev Businesses Processes Rajesh Mishra SVP & CHRO Human and IT CDO Resources Volvo Eicher Trucks and Buses, VEPT Bus Division EE
Slide 70: Strong Governance Principles
Strong Governance Principles EML and VECV are compliant with applicable regulations No related party suppliers Board Sub-committees at EML with majority representation by independent directors and at VECV with Non-Executives No delinquencies towards banks/ institutions Professional management at CXO
Slide 71: Financials
Financials INVESTOR PRESENTATION May 2022 70
Slide 72: Profit and Loss Statement (Consolidated)
Profit Profitand andLoss LossStatement Statement(Consolidated) (Consolidated) (In Rs. Cr.) Profit and Loss Account FY17 FY18 FY19 FY20 FY21 FY22 Sales Volume: Two Wheelers (Nos.) 666,135 820,121 822,724 697,582 609,403 595,474 Total revenue from operations (net of excise) 7,033 8,965 9,797 9,154 8,7
Slide 73: Balance Sheet (Consolidated)
Balance Sheet Profit and Loss(Consolidated) Statement (Consolidated) (In Rs. Cr.) Particulars FY17 FY18 FY19 FY20 FY21 FY22 Net Fixed Assets (including CWIP and Pre-operative 1,247 1,835 2, 324 2,690 2,748 2,929 Expenditure) Investments 4,987 5,581 4,923 5,749 3,902 7,721 Other Non Current Assets 26
Slide 74: Statement of Cash Flows (Consolidated)
Statement Profit and of Cash Loss Flows (Consolidated) Statement (Consolidated) (In Rs. Cr.) Particulars FY17 FY18 FY19 FY20 FY21 FY22 Profit before tax and after share of profit of Joint venture 2,433 3,116 3,297 2,355 1,798 2,203 Operating profit before changes in working capital 2,196 2,851 2,941
Slide 75: Glossary
Glossary ▪ CAGR – Compounded Annual Growth Rate ▪ LCV – Light Commercial Vehicles ▪ Consolidated – Consolidated includes financials of Royal Enfield, VE Commercial ▪ LMD – Light and Medium Duty Vehicles and 50% of Eicher Polaris Pvt. Ltd. ▪ MHCV – Medium and Heavy Commercial Vehicles ▪ CV – Commerci
Slide 76: Thank You
Thank You Get Social Royal Enfield Royal Enfield Royal Enfield INVESTOR PRESENTATION May 2022