Ashok Leyland Limited · NSE:ASHOKLEY
Ashok Leyland — Shareholder Meeting (July 2007)
37 slides from Ashok Leyland's shareholder meeting presentation, Jul 20, 2007
Slide 1: 58th Annual General Meeting
58th Annual General Meeting July 20, 2007 MD / AL / Annual General Meeting / 20/07/2007
Slide 2: Ashok Leyland's 2006-07 Score Card
Ashok Leyland’s 2006-07 Score Card MD / AL / Annual General Meeting / 20/07/2007
Slide 3: Sales touches all-time high
Sales touches all-time high Sales up 34.8%, touch an all-time high of 83,094 vehicles 83094 61655 54740 48654 36444 29673 '01-02 '02-03 '03-04 '04-05 '05-06 '06-07 MD / AL / Annual General Meeting / 20/07/2007
Slide 4: Second year of MS gain
Second year of MS gain With 76,736 numbers, domestic M&HCV volume at a new peak Out-performed the market : TIV up 33%; AL up 37% Market share up 0.8%, to 28% Second consecutive year of outperforming a competitive, expanding market MD / AL / Annual General Meeting / 20/07/2007
Slide 5: Revenue boosters
Revenue boosters Exports grew by 23.5% over 05-06 sales with a sale of 6,025 vehicles Engines Volumes grew 23% Leyparts saw record sales at Rs. 3288 million, growing 26% Fully-built solutions added nearly Rs. 2300 million to the top line MD / AL / Annual General Meeting / 20/07/2007
Slide 6: The financials
The financials Rs million 2005-06 2006-07 % growth Gross Sales / income from operations 60 531.08 83 047.17 37.20 Less Excise duty 8 054.51 11 365.41 41.11 Gross operating margin 5 400.70 7 026.85 30.11 Financial expenses 164.53 53.32 (67.65) Gross Profit (PBDT) 5 565.91 7 681.56 38.01 Depreciation
Slide 7: Composition of sales
Composition of sales 2005-06 2006-07 % Inc (Dec) Domestic Civilian Passenger 14 168 12 007 (15.3) Goods 42 106 64 144 52.3 Total 56 274 76 151 35.3 Defence 502 918 82.9 Exports 4 879 6 025 23.5 Total vehicles 61 655 83 094 34.8 Engines 7 261 8 904 22.6 Spares incl Defence 7 838 5 468 (30.2) (Rs mill
Slide 8: Performance highlights – 5 Years
Performance highlights – 5 Years 02-03 03-04 04-05 05-06 06-07 R O C E (%) 11.7 17.6 18.6 21.2 24.7 Inventory 3.7 5.2 5.7 5.3 5.5 Turns (Times) Debtors (Days) 26 21 14 18 17 Debt : Equity 0.8 0.5 0.3 0.2 0.3 EPS (In Rs.) 1.01 1.63 2.28 2.74 3.38 MD / AL / Annual General Meeting / 20/07/2007
Slide 9: Asset turns (times)
Asset turns (times) 3.39 2.76 2.53 2.41 1.81 '02-03 '03-04 '04-05 '05-06 '06-07 MD / AL / Annual General Meeting / 20/07/2007
Slide 10: Inventory turns (times)
Inventory turns (times) 5.66 5.26 5.54 5.21 3.65 '02-03 '03-04 '04-05 '05-06 '06-07 MD / AL / Annual General Meeting / 20/07/2007
Slide 11: Net current asset turns (times)
Net current asset turns (times) 9.41 6.67 5.93 5.7 3.55 2002-03 2003-04 2004-05 2005-06 2006-07 MD / AL / Annual General Meeting / 20/07/2007
Slide 12: Behind the results
Behind the results 1. Market 2. Value adding products and services 3. Capacity expansion 4. Increased productivity 5. Improving people efficiencies 6. Brand building MD / AL / Annual General Meeting / 20/07/2007
Slide 13: Propelled by the economy
1 Propelled by the economy Market The economy remained buoyant Freight generating sectors registered robust growth Infrastructure development continued to gain momentum NHAI project completion : 26% NHDP Phase V – 6,500 Kms included Some worry lines because of hardening interest rates, rising fuel &
Slide 14: CV industry on overdrive
1 CV industry on overdrive Market Growth rates remained healthy at over 33% The potential of demand for replacements high, with over 35% of existing fleet over 10 years old and stricter emission norms in the offing Volume growth helped by enforcement of rated payload regime. MD / AL / Annual General
Slide 15: M&HCV TIV: Passenger and Goods
1 M&HCV TIV: Passenger and Goods Market 246857 179345 172868 Passenger 136804 Goods 95741 Source: SIAM 73185 24591 25638 28127 28692 16814 19970 '01-02 '02-03 '03-04 '04-05 '05-06 '06-07 Sixth year of consecutive growth MD / AL / Annual General Meeting / 20/07/2007
Slide 16: Value adding products and services
2 Value adding products and services Value Adding Products & Services Increasingly actualising product philosophy Led by customer insight Application-specific product configurations Maximise customer profitability Supported by an array of after market service offerings to maximise revenue and return
Slide 17: Fuel-efficient engine development
2 Fuel-efficient engine development Value Adding Products & Services Euro 2 compliant engine developed on the popular H6 cylinder platform Using a Bosch in-line pump which is less sensitive to fuel quality, less expensive to maintain and hence preferred by the market Excellent fuel consumption Desig
Slide 18: After-market support
2 Value Adding After-market support Products & Services Added Current Dealership outlets 10 159 Authorized Service 28 149 Centres Work bays 138 2,010 Better availability of spares through enlarged network and improved logistics MD / AL / Annual General Meeting / 20/07/2007
Slide 19: Driver training
2 Value Adding Driver training Products & 33,000 drivers trained at our Driver Training Services Centres in Namakkal and Burari 8,000 trained at 5 Service Training Centres First franchisee service training center at Bhubaneswar A certification course, ALSERVE, for technicians and supervisors to be l
Slide 20: Capacity expansion
3 Capacity Capacity expansion Expansion Capacity enhanced to over 84,000 vehicles Mostly through productivity / efficiency improvements, with incremental investments Flexibility to meet market demand fluctuations 32 SCOT teams gave guidance for vendor capacity realization MD / AL / Annual General Me
Slide 21: Increased productivity
4 Improved Increased productivity Efficiencies Output per employee 8.5 7.1 5.8 4.9 3.5 '02-03 '03-04 '04-05 '05-06 '06-07 MD / AL / Annual General Meeting / 20/07/2007
Slide 22: Improving people efficiencies
5 Improving Improving people efficiencies People Efficiencies Mission Gemba : A movement to create value on the shop floor through attitudinal alignment and technical de-bottle-necking which has resulted in remarkable through-put improvements across the company Project YEs: To bring about organizati
Slide 23: Corporate Social Responsibility
Corporate Social Responsibility Disaster Management Training Alcohol De-addiction Centre at Namakkal Computer training to economically marginalized students in Hosur Self-Help Groups in Hosur Road Safety Road shows on Chennai Highway (GST Road) FunBus MD / AL / Annual General Meeting / 20/07/2007
Slide 24: Brand building: changing perceptions
Brand building: 6 Brand changing perceptions Building All round improvements combined with mass media communication last year has led to positive changes in brand perception MD / AL / Annual General Meeting / 20/07/2007
Slide 25: 2007-08 and beyond
2007-08 and beyond MD / AL / Annual General Meeting / 20/07/2007
Slide 26: The challenges in the offing
The challenges in the offing Slow down in market demand Continuing increase in input costs Margins under squeeze MD / AL / Annual General Meeting / 20/07/2007
Slide 27: Increasing capacities
Increasing capacities Uttaranchal Integrated manufacturing plant State-of-the-art technology being sourced from across the globe Layouts being made for lean manufacturing Production start up : phase 1 by 2nd half of 2008-09; phase 2 by March 2010 MD / AL / Annual General Meeting / 20/07/2007
Slide 28: Spreading the global footprint
Spreading the global footprint AVIA Organization rebuilding, alternate sourcing and value engineering programme for cost reduction on course Operations stabilized Dealership development in existing markets with new forays planned RAKIA An integrated Chassis and Bus assembly plant with an investment
Slide 29: Diversification
Diversification JV with Alteams A 50:50 JV with the Alteams Group to produce High Pressure Die Casting (HPDC) aluminum components pre- dominantly for telecommunications & automotive sectors Target turnover of Rs. 6.5 billion in about 5-7 years, with total investment of Rs.3.35 billion JV with Siemen
Slide 30: Investor Relations
Investor Relations MD / AL / Annual General Meeting / 20/07/2007
Slide 31: Value-added services for share-holders
Value-added services for share-holders Annual share-holders satisfaction survey Conducted for 6 years consecutively Responses are summarised and reviewed by the Share-holder/Investor Grievance Committee of the Board Investor Guide Sent to every share-holder every year since 1998 Annual Reports Discl
Slide 32: Sharing profits: steady increase in the dividend rate
Sharing profits: steady increase in the dividend rate Percentage increase 150 120 100 75 50 45 March '02 March '03 March '04 March '05 March '06 March '07 MD / AL / Annual General Meeting / 20/07/2007
Slide 33: A growing family of shareholders
A growing family of shareholders 200091 146824 137244 79804 75323 71103 March March March March March March '02 '03 '04 '05 '06 '07 MD / AL / Annual General Meeting / 20/07/2007
Slide 34: AL Price Share vs. NSE Index
AL Price Share vs. NSE Index Daily QASOK.NS [Line], Q.NSEI [Line] [Professional] 4/3/2006 - 4/30/2007 (GMT) Price Price QASOK.NS, Close(Last Trade), Line INR 5/3/2007 39.85 INR Q.NSEI, Close(Last Trade), Line 4000 5/3/2007 4,151.65 48 46 3800 44 3600 42 3400 40 3200 38 36 3000 34 2800 32 2600 Apr Ma
Slide 35: AL Price Share vs. BSE Index
AL Price Share vs. BSE Index Daily QASOK.BO [Line], Q.BSESN [Line] [Professional] 4/3/2006 - 4/30/2007 (GMT) Price QASOK.BO, Close(Last Trade), Line Price INR 5/3/2007 39.80 INR Q.BSESN, Close(Last Trade), Line 14000 5/3/2007 14,056.79 48 13500 46 13000 44 12500 42 12000 11500 40 11000 38 10500 36 1
Slide 36: Share-holding pattern
Share-holding pattern (As of 31st March, 2007) LRLIH 51.23% Others 1.07% MFs 7.29% FIIs 10.77% Body corporate 2.53% Fis, Insurance Co, State Govt, Govt NRIs Companies 1.87% 13.11% Trusts Resident Individuals 0.04% / Trust / Clearing Banks members 0.17% 11.92% MD / AL / Annual General Meeting / 20/07
Slide 37: Thank You
Thank You MD / AL / Annual General Meeting / 20/07/2007