Greaves Cotton Limited · NSE:GREAVESCOT
Greaves Cotton — Investor Presentation (May 2013)
40 slides from Greaves Cotton's investor presentation, May 2013
Slide 1: Greaves Cotton Limited Investors Meet May 2013
GREAVES COTTON LIMITED INVESTORS MEET May 2013
Slide 2: Disclaimer
DISCLAIMER Some of the statements in this document may include our financial and growth projections as well as statements concerning our plans, strategies, intentions and beliefs concerning our businesses and the markets in which we operate and constitute “forward looking statements” within the mean
Slide 3: Passion for Excellence: About GCL
Passion for Excellence About GCL GCL Growth Strategy Financial Performance 3 3
Slide 4: Greaves Has Made Rapid Strides Over the Past Decade
GREAVES HAS MADE RAPID STRIDES OVER THE PAST DECADE 2012 Crosses three million in light 2010 diesel engines 2008 Acquires Ascot Technology Centre International and manufacturing FZC, UAE facility for the new G Series engines opens in Pune 2004 Rolls Out 2013 Millionth Light Establishes strength in D
Slide 5: The Company Has Delivered Sustained Growth Over the Last 10 Years
THE COMPANY HAS DELIVERED SUSTAINED GROWTH OVER THE LAST 10 YEARS REVENUE (INR Cr) CAGR of 1600 13% 1873 348 1753 1347 1252 1063 1150 1041 834 637 652 530 FY03 FY 04 FY 05 FY 06 FY07 FY 08 FY 09 FY 10 FY11* FY12 FY13 PAT (INR Cr) 155 CAGR of 185 53% 28 127 138 122 118 110 85 62 56 22 2 FY03 FY 04 FY
Slide 6: The Company Is Debt Free and Has Seen a Steady Increase in Net Worth
THE COMPANY IS DEBT FREE AND HAS SEEN A STEADY INCREASE IN NET WORTH DEBT (INR Cr) D/E = 3 239 127 D/E = Nil 79 54 39 49 44 5 6 20 2.2 FY03 FY 04 FY 05 FY 06 FY07 FY 08 FY 09 FY 10 FY11 FY12 FY13 NET WORTH (INR Cr) 738 645 522 404 437 371 295 211 106 143 80 FY03 FY 04 FY 05 FY 06 FY07 FY 08 FY 09 FY
Slide 7: Business Segments
BUSINESS SEGMENTS SEGMENT SHARE (FY13) Segments Products 3% Automotive Applications 9% Industrial Applications Engines Auxiliary Power Applications Farm Applications 88% Infrastructure Road Making Equipment Concreting Other products- Light Agricultural Equipment Traded Traded Construction Equipment
Slide 8: Greaves Serves Five End Use Sectors (1/5) Automotive
GREAVES SERVES FIVE END USE SECTORS (1/5) Automotive PORTFOLIO OF SINGLE/ TWIN CYLINDER ENGINES Single Cylinder Engine - Diesel Single Cylinder Engine - Gasoline Twin Cylinder Engine - Diesel MAJOR OEMs Market Leader with more than 3 million engines in the market 8 8
Slide 9: Greaves Serves Five End Use Sectors (2/5) Industrial Engines
GREAVES SERVES FIVE END USE SECTORS (2/5) Industrial Engines PORTFOLIO OF DIESEL ENGINES Single Cylinder Twin Cylinder 3/4 Cylinder 4/6/8/12 Cylinder KEY CUSTOMER SEGMENTS Genset Marine Fire Fighting Farm Construction Defense Provides Engines upto 700HP for Various Industrial Applications 9 9
Slide 10: Greaves Serves Five End Use Sectors (3/5) Auxiliary Power
GREAVES SERVES FIVE END USE SECTORS (3/5) Auxiliary Power PORTFOLIO OF DIESEL GENSETS Portable Genset Small Genset LHP/ MHP Genset KEY CUSTOMER SEGMENTS Retail, Hotels, Hospital & Residential Industry Railways & Defense Commercial Complexes Over 5 Decades of Experience in Providing Auxiliary Power 1
Slide 11: Greaves Serves Five End Use Sectors (4/5) Farming
GREAVES SERVES FIVE END USE SECTORS (4/5) Farming PORTFOLIO OF ENGINES & PUMPSETS Petrol-Kerosene Engines & Pumpsets Diesel Pumpsets Electrical Pumpsets PORTFOLIO OF LIGHT AGRICULTURAL EQUIPMENT Mini Tractor Power Tiller Power Reaper Brush Cutter Power Sprayer Greaves Is Amongst The Most Trusted Par
Slide 12: Greaves Serves Five End Use Sectors (5/5) Construction
GREAVES SERVES FIVE END USE SECTORS (5/5) Construction PORTFOLIO OF CONCRETING EQUIPMENT Concrete Pump Concrete Mixer Batching Plant PORTFOLIO OF ROAD EQUIPMENT Vibratory Compactor Heavy Tandem Roller Light Tandem Roller Major player in the Road & Concreting equipment 12 12
Slide 13: Strong Sales & Service Network in India
GREAVES HAS A STRONG SALES & SERVICE NETWORK IN INDIA TO SERVE ITS DIVERSE CUSTOMER BASE 13 Strong Pan-India Reach
Slide 14: Shareholding Pattern
SHAREHOLDING PATTERN SHAREHOLDING PATTERN (as on 31.03.13) 12.7% • Share Capital : INR 48.84 Cr • Listing : 51.6% • Bombay Stock Exchange (BSE) 35.7% • National Stock Exchange (NSE) • Market Capitalization : INR 1,752 Cr (as on 30.04.13) Promoters Institutional Investors Indian Public GREAVES COTTON
Slide 15: Greaves Today
GREAVES TODAY KEY HIGHLIGHTS ABOUT THE COMPANY • Leading diesel engine manufacturer with annual production of over half million engines • Market Leader in last mile automotive application and Pumpsets for farm application • Strong capability in diesel engine technology • Strong reach and brand stren
Slide 16: Key Milestones in FY13: Technology Tie-up With Samil, Korea
KEY MILESTONES IN FY13 Technology Tie-up With Samil, Korea for Concrete Equipment 16
Slide 17: Key Milestones in FY13: Award From TATA Motors
KEY MILESTONES IN FY13 Award For Excellence In Delivery From TATA Motors 17
Slide 18: Key Milestones in FY13: Entry into Mini Tractor Market
KEY MILESTONES IN FY13 Entry into Mini Tractor Market through USTAD 18
Slide 19: Integrity & Responsibility: GCL Growth Strategy
Integrity & Responsibility About GCL GCL Growth Strategy Financial Performance 19 19
Slide 20: Expansion in Product-Market Play Through Capability Development
GREAVES IS FOCUSSING ON EXPANSION IN PRODUCT-MARKET PLAY THROUGH CAPABILITY DEVELOPMENT Expanding Product-Market Play….. ..through Capability Development Focus on Growth through Capability Development 20
Slide 21: Strong Leadership Team to Drive Business Growth
THE COMPANY HAS PUT IN PLACE A STRONG LEADERSHIP TEAM TO DRIVE BUSINESS GROWTH MD & CEO Sunil Pahilajani Functional Leadership CFO CTO CHRO CS A.K. Sonthalia S.J.R. Kutty Anil Gole Monica Chopra Business Leadership CEO – Automotive CEO – Farm CEO – Auxiliary Power & CEO – Construction CEO – Aftermar
Slide 22: Operational Efficiency Drive Resulting in Cost Savings
EMBARKED ON OPERATIONAL EFFICIENCY DRIVE WHICH RESULTED IN COST SAVINGS AND PROCESS EFFICIENCY COST REDUCTION • Company wide initiative to reduce material cost and manufacturing costs is undertaken to enhance profitability • In the absence of this initiative, the material cost of the company would h
Slide 23: Aftermarket Business Carved Out as Independent Business Line
AFTERMARKET BUSINESS HAS BEEN CARVED OUT AS AN INDEPENDENT BUSINESS LINE TO ENHANCE SERVICE DELIVERY Attractiveness of After Sales and Service Ranges High Service as Competitive Advantage Management of assets Financing Operator models Facility management Benefits for Customer Service for Process opt
Slide 24: Special Emphasis on Growth in International Markets
THE COMPANY IS LAYING SPECIAL EMPHASIS ON GROWTH IN INTERNATIONAL MARKETS INTERNATIONAL GROWTH PATH • Build business for GCL manufactured products in chosen markets by developing strong distribution channel and on-ground presence through branch offices • Graduate to local assembly operations • Build
Slide 25: Growth Path to Expand Product-Market Play (1/2)
GROWTH PATH TO EXPAND PRODUCT-MARKET PLAY (1/2) Current Strength Growth Path • Develop new OEMs in 4W SCV segment and 3W segment • Market Leader in last mile transportation Automotive • Expand into higher capacity engines • Growth in alternate fuels – CNG, Petrol • Develop new OEMs for • Strong Play
Slide 26: Growth Path to Expand Product-Market Play (2/2)
GROWTH PATH TO EXPAND PRODUCT-MARKET PLAY (2/2) Current Strength Growth Path • Expand into Electrical Pumpsets • Develop portfolio of own manufactured • Strong Player in Oil Pumpsets Light Agri Equipment • Light Agri Equipment Farm • Leverage existing and develop new • Launch of Mini Tractor network
Slide 27: Rapid Capability Development for Product-Market Expansion
TO DELIVER ON EXPANSION IN PRODUCT-MARKET PLAY, GREAVES IS LOOKING AT RAPID CAPABILITY DEVELOPMENT PRODUCT DEVELOPMENT • ~ Rs 100 Cr planned to be invested for growth initiatives in 2013-14 • More than 50 product development specialists planned to be added during 2013-14 to give a major thrust to ne
Slide 28: Greaves Values PanchaTatva
GREAVES VALUES “PANCHATATVA” LAUNCHED – TO BE NURTURED AS A WAY OF LIFE Greaves PanchaTatva 5 Values. 1 Way of Life. 28
Slide 29: Respect & Transparency: Financial Performance
Respect & Transparency About GCL GCL Growth Strategy Financial Performance 2929
Slide 30: Revenue Growth Driven by 4W Automotive Engines & Aftermarket
THE COMPANY ACHIEVED REVENUE GROWTH DRIVEN BY 4W AUTOMOTIVE ENGINES & FOCUS ON AFTERMARKET ENGINES SEGMENT - Revenue up by 8% • Automotive Engines firmly established itself in the 4W SCV segment with TATA Ace Zip and TATA Magic Iris taking leadership position in the <0.6T segment (~65,000 engines so
Slide 31: Key Financial Highlights of FY13
KEY FINANCIAL HIGHLIGHTS OF FY13 KEY FINANCIAL HIGHLIGHTS OF FY13 • Revenue increased by 7% from Rs. 1753 Cr in FY12 to Rs. 1873 Cr in FY13 • EBIDTA increased by 2% from Rs. 237 Cr in FY12 to Rs. 242 Cr in FY 13 • EBITDA margin decreased by 0.6% from 13.5% in FY12 to 12.9% in FY13 • The impact was m
Slide 32: Financial Snapshot - Revenue & EBITDA
FINANCIAL SNAPSHOT - REVENUE & EBITDA REVENUE Q4 (INR Cr) REVENUE (INR Cr) 500 490 11% 496 1900 480 470 1850 5% 7% 460 1873 450 1800 440 1750 430 445 1753 420 1700 410 1650 FY12 FY13 FY 12 FY 13 EBITDA Q4 (INR Cr) EBITDA (INR Cr) 64 25.0% 25.0% EBITDA MARGIN(%) EBITDA MARGIN(%) 240 63 242 63 238 20.
Slide 33: Financial Snapshot - PBT & PAT
FINANCIAL SNAPSHOT – PBT & PAT PBT Q4 (INR Cr) PBT (INR Cr) 120 16% 300 15% 250 100 96 15% 250 PBT Margin (%) 250 43 200 250 14% PBT Margin (%) PBT (Rs Cr) 80 43 14% 200 PBT (Rs Cr) 96 13% 60 13% 150 40 11.9% 12% 100 11.8% 207 218 12% 53 56 11.3% 207 207 11.6% 20 223 11% 50 223 11% 0 10% 0 -18 FY12
Slide 34: Financial Snapshot - Shareholder Returns
FINANCIAL SNAPSHOT – SHAREHOLDER RETURNS FY 08 FY 09 FY 10 FY 11* FY 12** FY 13** EPS (Rs.) 4.5 2.3 4.8 6.3 7.6 5.7 DPS (Rs.) 1.2 0.8 3.0# 1.5 2.2# 1.6 Avg. Market Price 42.2 19.8 30.3 76.6 85.5 73.9 (Rs) Net Worth (Rs. Cr) 371 404 437 522 645 738 BVPS (Rs.) 15.2 16.5 17.9 21.6 26.7 30.5 Debt ( Rs.
Slide 35: Financial Snapshot - Income Statement
FINANCIAL SNAPSHOT- INCOME STATEMENT FY12 FY13 Growth Rs Cr Q4 12M Q4 12M Q4 12M Revenue 445 1753 496 1873 11% 7% EBITDA 60 237 63 242 5% 2% EBIDTA % 13.5% 13.5% 12.7% 12.9% PBT before Exceptional Items 53 207 56 218 6% 5% PBT before Exceptional Items % 11.9% 11.8% 11.3% 11.6% Income from Exceptiona
Slide 36: Financial Snapshot - Balance Sheet
FINANCIAL SNAPSHOT- BALANCE SHEET Rs Cr Mar’12 Mar’13 Equity & Liabilities Shareholders Fund 649 742 Non- Current Liabilities 44 52 Current Liabilities 400 386 Total 1093 1180 Applications Fixed Assets (Net) 346 376 Investment 58 68 Current Assets 611 688 Other Non- Current Assets 78 48 Total 1093 1
Slide 37: Key Financial & Operational Ratios
FINANCIAL SNAPSHOT - KEY FINANCIAL & OPERATIONAL RATIOS Category Unit FY12 FY13 EBITDA Margin % 13.5% 12.9% Profitability Net Profit Margin % 8.2% 8.3% (exc. exceptional items) Fixed Asset Turnover Times 5.1 5.2 Debtor Days 52 68 Activity Inventory Days 50 42 Creditors Days 57 60 Trade Working Capit
Slide 38: Financial Stability
FINANCIAL STABILITY • Credit Rating AA by Fitch • Consistent track record of paying quarterly dividends • Sustained Revenue growth • Consistent Positive Cash Flow from Operations • Debt-free Company 38
Slide 39: Key Take-Aways
KEY TAKE-AWAYS GREAVES – Poised for Growth • Present in high growth segments of economy • Extensive market reach in India; Leadership position in last mile transportation and agricultural pump sets • De- risked business portfolio • Presence in multiple industry segments • Healthy split between equip
Slide 40: wow greavescoftton.com
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