Tube Investments Of India Limited · NSE:TIINDIA
Tube Investments Of India — Q2 FY2020 Earnings Presentation
34 slides from Tube Investments Of India's earnings presentation, November 2019
Slide 1: Unleashing Potential
Unleashing Potential Investor Presentation – Q2 FY 20 1
Slide 2: Disclaimer
DISCLAIMER Certain statements included in this presentation may be forward looking statements made based on management’s current expectations and beliefs concerning future developments and their potential effects upon Tube Investments of India Limited and its subsidiaries. There can be no assurance
Slide 3: Agenda
Agenda • Unleashing the Potential • 4 Financial Priorities • Decentralization • Driving improvement through project teams • TI WAY • Growth Focus • Strengthening the Balance Sheet • Business Performance by SBU • Back-up details on products 3
Slide 4: Unleashing the Potential
Unleashing the Potential DECENTRALIZ- ATION & EMPOWERMENT FINANCIAL PROJECT-BASED GROWTH FOCUS OBJECTIVES APPROACH TI WAY 4
Slide 5: Four Financial Objectives
Four Financial Objectives Bringing uniformity in how we measure progress Sales growth 17% PBT/Sales 10% ROCE 30% FCF/PAT 85% 5
Slide 6: Four Financial Objectives: The journey so far
Four Financial Objectives The journey so far.. +15% Net Sales PBT (Before Excep.) 4983 10% 371 4335 -13% 7% 6% 2574 218 5 218 2239 164 17-18 18-19 H1 18-19 H1 19-20 17-18 18-19 H1 18-19 H1 19-20 PBT% PBT 208 Free Cash Flow ROCE 85% 86% 21.5% 21.8% 70% 19.1% 53% 154 14.3% 95 59 17-18 18-19 H1 18-19 H
Slide 7: Decentralization
Decentralization Empowerment at Unit levels 18 BUs created Division head’s role changed from control to supporting BUs in growth, lowering the centre of gravity 7
Slide 8: 60+ Project Teams to Drive Improvements
Project-based Approach to Improvements Driving a Kaizen mind-set for improvements at all levels Fixed Cost Revenue Reduction Energy Enhancement Sourcing Logistics Scrap Realization Net Interest 60+ Project Teams to Quality & Productivity Drive Improvements …. Target-oriented actions for continuous i
Slide 9: TI Way - Segments - Processes
TI WAY 9 - SEGMENTS 40 - PROCESSES 9
Slide 10: Focus on Growth
FOCUS ON GROWTH • Different Approaches Based on Segment Potential • Planning Across 3 Horizons • New Businesses 10
Slide 11: Portfolio of Business & Expected Growth Patterns
Portfolio of Business & Expected Growth Patterns Capital allocation based on future potential • TPI Exports • TPI Large Dia 28% High Growth > 15% • Fine Blanking Supported by Exports • Railways • TPI Domestic • CRSS Moderate • Industrial Chains 12% Growth 5-15% • Industrial Gears • Door Frames 4% Lo
Slide 12: Focus on Growth Across Three Horizons
Focus on Growth Across Three Horizons Gradual progression towards higher levels of growth • Acquire stressed assets in existing businesses (incl. overseas) Near adjacencies • Step-out asset acquisition (e.g., TBW, TMT) • Acquire stressed assets under insolvency process (NCLT) • Scaling up in new lin
Slide 13: Criteria for New Business Lines
Criteria for New Business Lines Choosing the path carefully.. FOCUSED ON Filters for new businesses MARKET SIZE FOUR TRENDS 1 Rs.6,000 Cr. or more Import substitution and Exports POTENTIAL Auto Electrification 2 Rs.1,000 Cr. in three years Unorganized to organized 3 LOW CAPITAL INTENSITY B2B to B2C
Slide 14: Strengthening the Balance Sheet
Strengthening the Balance sheet Prudent Capital Management + Asset Monetization + NWC Efficiency 794 781 Rs.Crs 673 689 679 0.65 0.64 637 655 605 0.59 0.58 0.56 513 0.48 0.48 0.47 384 0.36 289 0.25 0.18 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2016-17 2017-18 2017-18 2017-18 2017-18 2018-19 2018-19 2018-19
Slide 15: Financial Performance by Business
FINANCIAL PERFORMANCE BY BUSINESS 15
Slide 16: TI Performance – A Snapshot
TI Performance – A Snapshot Rs. Cr. Particulars Standalone Consolidated 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
Slide 17: TI – Other Key Ratios
TI – Other Key Ratios EPS (Rs/share) ROE 13.0 21.7% 17.1% 16.9% 9.5 8.5 13.9% 7.3 11.2% 6.0 16-17 17-18 18-19 H1 18-19 H1 19-20 16-17 17-18 18-19 H1 18-19 H1 19-20
Slide 18: Engineering Business
Engineering Business • ERW Tubes - Electric Resistance Welded Tubes • CDW Tubes - Cold Drawn Welded Tubes Products • TCD - Tubular Components • CRSS – Cold Rolled Steel Strips • LD - Large Diameter Tubes • Tamil Nadu - Avadi and Tiruttani (Large Diameter Tube) Plants • Maharashtra – Shirwal • Punjab
Slide 19: Engineering Business – Financial Snapshot
Engineering Business – Financial Snapshot ` Crs 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% ` Crs Particulars 31-03-2019 30-09-2018 30-09-2019 Net Fixed Assets 530 533 570 Net Working Capital 157 168 146 Capital
Slide 20: Engineering Business - Key Parameters
Engineering Business - Key Parameters Net Sales PBIT (Before Excep.) PBIT% PBIT 2676 (`.Crs) 2131 254 175 1382 1127 130 130 17-18 18-19 H1 18-19 H1 19-20 17-18 18-19 H1 18-19 H1 19-20 ROCE 36.9% 36.9% 36.3% 26.4% 17-18 18-19 H1 18-19 H1 19-20
Slide 21: Metal Formed Business
Metal Formed Business • Auto Chains • Fine Blanking Products • Doorframes • Railway Coaches • Industrial Chains • Tamil Nadu – Ambattur, Nemilichery, Kakkalur, Athipet, Hosur • Telengana - Medak Plants • Uttarakhand • Haryana – Bawal • Gujarat - Sanand
Slide 22: Metal Formed Products – Financial Snapshot
Metal Formed Products – Financial Snapshot ` Crs 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% ` Crs Particulars 31-03-2019 30-09-2018 30-09-2019 Net Fixed Assets 336 296 339 Net Working Capital 114 122 123 Capital Empl
Slide 23: Metal Formed Products - Key Parameters
Metal Formed Products - Key Parameters Net Sales PBIT (Before Excep.) (`.Crs) 1286 PBIT% PBIT 1095 123 102 613 690 74 57 17-18 18-19 H1 H1 17-18 18-19 H1 H1 18-19 19-20 18-19 19-20 ROCE 32.0% 26.2% 27.3% 27.2% 17-18 18-19 H1 18-19 H1 19-20
Slide 24: Cycles Business
Cycles Business • Cycles and Accessories Products • 53 new models launched • Tamil Nadu – Ambattur • Punjab – Rajpura Plants • 8500 Dealers across India • 225 Track & Trail stores as on 30th September 2019 Brands • BSA, Hercules, Lady bird, Roadeo, Mach City, Montra, Track & Trail
Slide 25: Cycles Business - Market Share and Product Mix
Cycles Business - Market Share and Product Mix Market Share Product Mix (%) 7% Atlas Standards 19% 28 Specials Avon 37 12% Hero TII Others 72 63 28% 35% Source : ACMA Industry TII
Slide 26: Cycles – Financial Snapshot
Cycles – Financial Snapshot ` Crs 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% ` Crs 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 C
Slide 27: Other Details
Other Details 27
Slide 28: TI’s Presence
TI’s Presence TPI MFPD TICI Punjab (3) – Uttarakhand (2) Mohali & Rajpura Haryana (1) - Bawal Gujarat (1) – Sanand Maharashtra (2) Telengana (1) - Medak – Shirwal & Pune Tamil Nadu (8)
Slide 29: Shareholding Pattern
Shareholding Pattern Top 10 Institutional Holders Others • HDFC Mutual Fund 17% • Nippon India Mutual Fund • L&T Mutual Fund • SBI Mutual Fund 48% Promoter & Promoter Group • Toyota Tsusho Corporation DII 23% • The Wellington Trust Company National Association • First State Investments ICVC- Stewart
Slide 30: Share Price Movement
Share Price Movement +36% 383 354 363 304 267 266 264 230 17-18 17-18 18-19 18-19 18-19 18-19 19-20 19-20 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 * Share price - `457 as on 22nd Nov’19
Slide 31: Metal Formed Products
Metal Formed Products Drive Chains Kit Side Impact Beams Door Frames Divisional Channels Cowl Cross Beam Cam Chains After Market Brands Railways Power transmission Fine Blanked and Conveying Engineering Class Products Chains Chains
Slide 32: Track and Trail – Retail Experience
Track and Trail – Retail Experience
Slide 33: Shanthi Gears - Products
Shanthi Gears - Products Spur/ Pinion Internal Worm Straight Spiral Helical Shaft Gear and Bevel Bevel Gear Wheel Worm Gearboxes- Worm Gearboxes- Special Worm Gearboxes- Adaptable Standard Bevel Helical Helical Gearboxes Gearboxes
Slide 34: Thank You
Thank You Investor Presentation – Q2 FY 20 34
Tube Investments of India — Q2 FY2020 Earnings Presentation on 6ix