Slide 1: DCX Systems Limited Investor Presentation Q3 & 9M FY24
DCX Systems Limited Investor Presentation Q3 & 9M FY24 Indigenise • Integrate • Manufacture
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by DCX Systems Limited (the “Company”) solely for information purposes and does not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contr
Slide 3: Table of Contents
Table of Contents 01 COMPANY OVERVIEW 02 BUSINESS OVERVIEW 03 INDUSTRY OVERVIEW 04 FINANCIAL HIGHLIGHTS 05 WAY AHEAD 06 GLOSSARY
Slide 4: Company Overview
Company Overview
Slide 5: About Us
About Us • 30,000 sq. ft. • Preferred & largest • Diverse mix of domestic manufacturing unit, Indian Offset Partner & international strategically located in SEZ to Israeli Defence customers across Israel, in Bengaluru Company, IAI, for its US, Korea & India • New Raneal EMS 40,000 offset obligations
Slide 6: Our History
Our History 2020 ▪ Commissioned new ▪ Granted industrial license by manufacturing facility at Hi- 2023-24 Department of Industrial Policy & Tech Defence & Aerospace Promotion, GoI – manufacture items Park SEZ in Bengaluru, ▪ Started Commercial including microwave & electronic Karnataka production –
Slide 7: Consistent Growth
Consistent Growth Revenue Growth ( Rs. In crores) 1500 1254 Consistent growth in top line 1102 driven by competent & 1000 641 experienced leadership with 500 449 focused vision and robust 300 execution capabilities 0 2019 2020 2021 2022 2023 • Healthy CAGR of 43% on PAT Growth ( Rs. In crores) reven
Slide 8: Strong & Experienced Management
Strong & Experienced Management Dr. H.S. Raghavendra Rao | Chairman & Managing Director ▪ Promoter of Company with over 3 decades of experience in electronics manufacturing, defence & aerospace sectors Ranga KS | Whole Time Director & Chief ▪ Conferred with Business Leader of the Year award by ET Fi
Slide 9: Unique Business Model
Unique Business Model Shift to Product Company Offset / Non-Offset ▪ Focus on transfer of technology from OEM 06 01 ▪ Strong relationship with Israeli Defence and Make-in-India Product Companies, built over a Decade ▪ Cater to diverse end applications – defence, ▪ IOP / Non-IOP partner for Israel /
Slide 10: Key Strengths
Key Strengths Among preferred Indian Experienced & qualified Core competency & Promoters & senior Growing Cable & Wire Offset Partners for defence & Harness portfolio with aerospace industry across experience in electronics management team supported manufacturing by competent skilled better margins
Slide 11: Business Overview
Business Overview
Slide 12: Business Structure
Business Structure DCX Systems Limited Manufacturing System Integration Others Cable & Wire EMS (PCB IOP Non IOP Kitting MRO Harness Assembly) ❑ Focus on growing this ❑ Core competency of ❑ Preferred IOP for IAI ❑ Focusing on ❑ Supply assembly ready ❑ Testing & high margin business Company & Group e
Slide 13: Manufacturing
Manufacturing Manufacturing Cables & Wire Harness ❑ Design & development of complex cables & wire harness ❑ Cater to electronic warfare & communication systems ❑ Established product portfolio covering cables & wire harnesses assemblies, like RF cables, co-axial, mixed signal, power, & data cables ❑
Slide 14: Electronics Manufacturing Services
Electronics Manufacturing Services RANEAL ADVANCE SYSTEMS For Manufacturing, Leads to better cost Used in Defence, Qualification & Life control. Aerospace, cycle support of Supply chain Industrial high reliability rationalization & Electronics, Medical electronic resource planning. Electronics, etc.
Slide 15: NIART Systems – Railways Opportunity
NIART Systems – Railways Opportunity JV with ELTA Systems ➢ DCX formed JV with ELTA Systems – named NIART Systems Ltd – to develop MOATs / USP obstacle detection solutions ➢ Company benefits from technical ➢ JV to obtain ToT from ELTA & leverage know-how from ELTA while leveraging DCX’s manufacturin
Slide 16: System Integration
System Integration System integration (SI) services include electronics and electro-mechanical and enclosure assembly Covers in-house quality testing, e.g. vibration & environmental stress testing of complex RF products Used in radar, communication, surveillance & missile systems Preferred IOP partn
Slide 17: IOP Capability for Offset Opportunities
Offset Opportunities Electronic Assemblies Automatic missile detection radars ▪ Among largest IOPs for IAI IOP Capability for Group, Israel, for Indian defence market Unmanned aerial vehicle systems ▪ “Build-to-Print” System Integration and Barak Systems manufacture cable & wire harness assemblies M
Slide 18: Others
Others MRO ❑ Sizeable opportunity in Maintenance, Repair & Overhaul ❑ DCX would be in better position to offer MRO services as it has in-house testing machinery provided by OEMs ❑ Additional stream of revenue with better margins ❑ No additional capex involved Kitting ❑ Supply assembly ready kits of
Slide 19: Strong Customer-base Supporting DCX
Strong Customer-base Supporting DCX Key Customers Working closely with clients: ✓ For timely execution ✓ For ‘Just-in-Time’ Inventory Management ✓ To improve quality of raw materials supplied Customers typically DCX & its customers Obsolescence proof – Customers provide Operational reimburse costs j
Slide 20: Industry Overview
Industry Overview a -
Slide 21: Indigenous Industry Drivers
Indigenous Industry Drivers Atma Nirbhar Bharat • Positive Indigenization List / Make in India • Budget Allocation • Corporation of Ordnance Factory Board (OFBs) • FDI Norms • Indian Offset – Self Reliant Industry Tailwinds: • Application of EMS products in civilian & other sectors like medical devi
Slide 22: Growing Defence Landscape presents key Opportunities
Growing Defence Landscape presents key Opportunities Growth Drivers Global Defence Spending Forecast (in USD billion) CAGR: 3.99% Ongoing political tensions and geopolitical uncertainty 2,524 2,600 2,652 2,290 2,427 2,181 Great power struggle and competition amongst nations Modernisation of armed fo
Slide 23: Well-placed to Capitalize on Industry Tailwinds
Well-placed to Capitalize on Industry Tailwinds High India market potential for DCX USD Mn CAGR: 15.4% Numerous Government Initiatives Cable & Wire Harness 1,477.3 Industry Size 541.2 Positive Indigenisation List 2022 2029 USD Mn CAGR: 49.7% 4,510.0 Defence Acquisition Policy 2020 EMS Industry Size
Slide 24: Financial Highlights
Financial Highlights
Slide 25: Q3 FY24 Financial Highlights
Q3 FY24 Financial Highlights Standalone Particulars (Rs. Crs.) Q3 FY24 Q3 FY23 Y-o-Y (%) Q2 FY24 Q-o-Q (%) Revenue from Operations 197.98 355.95 (44.38%) 309.12 (35.96%) Raw Material Expenses 178.79 322.01 283.54 Employee Cost 3.19 2.66 3.08 Other Operating expenses (Incl. FX 5.15 8.22 3.47 Gain/Los
Slide 26: 9M FY24 Financial Highlights
9M FY24 Financial Highlights Standalone Particulars (Rs. Crs.) 9M FY24 9M FY23 Y-o-Y (%) Revenue from Operations 677.20 743.08 (8.87%) Raw Material Expenses 618.95 663.15 Employee Cost 9.26 7.73 Other Operating expenses (Incl. FX Gain/Loss) 9.10 34.14 Total Expenditure (Incl. FX Gain/Loss) 637.31 70
Slide 27: Sept '23 Standalone Balance Sheet
Sept ‘23 Standalone Balance Sheet Rs. in Crores Rs. in Crores Mar-23 Sep-23 Mar-23 Sep-23 Total Equity & Liabilities Total Assets Shareholders Funds 567.06 592.64 Non Current Assets 31.12 35.19 Share Capital 19.35 19.35 Property, plant & Equipment 10.82 13.46 Other Equity 547.71 573.29 Right of use
Slide 28: Standalone Cash Flow Statement
Standalone Cash Flow Statement Rs. in Crores Mar-21 Mar-22 Mar-23 Net Profit Before Tax 39.81 75.56 86.10 Adjustment:- Depreciation 2.43 2.18 1.82 Interest Expenses 4.74 7.24 18.71 Interest Income -22.40 -22.02 -29.40 Excess of cost over fair value of investments 0.02 - - Profit on Sale of Fixed Ass
Slide 29: Way Ahead
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Slide 30: De-Risking Strategies
De-Risking Strategies Backward New Grow Share of Grow Cable & Integration Geographies Non-Offset Wire Harness into EMS Penetration Projects Business • PCBAs manufacturing • Tap into new • Expand global presence • Focus on growing this through subsidiary, opportunities in in aerospace & defence produ
Slide 31: Move Towards Product Company
Move Towards Product Company Technology Driven Product Company Govt. released Positive Indigenization list for Make in Focus on acquiring India Program in the Defence Save on R&D costs by ToT also saves manpower Technology through JVs / sector which (cannot be acquiring ToT / JVs from cost and produ
Slide 32: Key Recent Developments
Key Recent Developments Raised Rs. 500 crores in the month of Jan - 2024 by way of QIP comprising of Institutional investors like MF, FII, and IC. The object of fund raise was: Investment in Subsidiary – NIART Systems Limited (DCX – ELTA) Investment in JVs/Subsidiaries DCX Systems further plans to i
Slide 33: Glossary
Glossary Term Description Term Description IPC Institute for Printed Circuit DAP Defence Acquisition Policy LRSAM Long Range Surface-to-Air Missiles DOMW Defence Offset Management Wing MoD Ministry of Defence EMS Electronic Manufacturing Services MRO Maintenance, Repair and Overhaul PCBA Printed Cir
Slide 34: Thank You
Thank You Company : Investor Relations Advisors : DCX Systems Limited Adfactors PR Pvt. Ltd. Mr. Amit Sharma cs@dcxindia.com Amit.sharma@adfactorspr.com Mr. Rahul Trivedi rahul.trivedi@adfactorspr.com www.dcxindia.com www.adfactorspr.com 34