Eicher Motors Limited · NSE:EICHERMOT
Eicher Motors — Investor Presentation (June 2020)
73 slides from Eicher Motors's investor presentation, Jun 17, 2020
Slide 1: Exchange filing cover letter
June 17, 2020 Online intimation/submission The Secretary The Secretary BSE Limited National Stock Exchange of India Ltd Phiroze Jeejeebhoy Towers Exchange Plaza, 5th Floor Dalal Street Plot No.C/1, G Block Mumbai-400 001 Bandra Kurla Complex, Bandra (E) Security Code: 505200 Mumbai-400 051 Symbol: E
Slide 2: Investors Presentation June 2020
5/20/2020 Investors Presentation a June 2020
Slide 3: Contents
Contents 1 EICHER MOTORS LIMITED – OVERVIEW 2 ROYAL ENFIELD 3 VE COMMERCIAL VEHICLES 4 FINANCIALS 5 APPENDIX 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 of
Slide 4: Eicher Motors Limited Overview
Eicher Motors Limited OVERVIEW INVESTOR PRESENTATION June 2020 3
Slide 5: Key Milestones
Key Milestones India’s first Royal Enfield Enters heavy Forms JV* with AB Volvo Shutdown of tractor rolls out motorcycles duty trucks of Sweden; transfers operations of of Eicher factory acquired segment commercial vehicle Eicher Polaris in Faridabad business to the JV* 1959 1984 1991 1993 2002 2005
Slide 6: Shareholding Pattern (31st March 2020)
Shareholding Pattern (31st March 2020) Domestic Promoter Group Foreign Institutional Others Institutional Investors Investors 49.28% 27.71% 11.12% 11.89% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Eicher Motors Limited (EML) Volvo Group Business Unit 45.6 Royal Enfield (RE) VE Commercial Vehicles (
Slide 7: Eicher Management Philosophy
Eicher Management Philosophy Break-through emerging Established Corporate Strong Values market business model Governance ▪ An evolved business model with ▪ Fully empowered management ▪ Corporate conduct rooted in 50+ years of experience in teams highest standards of ethics, automotive space in India
Slide 8: Board
Board Eicher Motors Limited VE Commercial Vehicles S Sandilya Siddhartha Lal* Non-executive Chairman Chairman Siddhartha Lal Vinod Aggarwal Managing Director Managing Director & CEO Vinod K. Dasari Jan Gurander Whole Time Director & Additional Director CEO - Royal Enfield Philippe Divry Vinod Aggarw
Slide 9: Business Highlights – FY 2019-20
Business Highlights – FY 2019-20^ Debt 0 698,216 26.6% 24.3% 29.5% EML continues Motorcycles sold Royal Enfield’s Royal Enfield’s VE Commercial to be Net debt in FY20, ~13x in market share in EBITDA margin Vehicles market free& company last 9 years the mid-size in FY20, industry share in domestic mo
Slide 10: Royal Enfield
INVESTOR PRESENTATION June 2020 9
Slide 11: Our Vision is to be a Global Motorcycling Brand
Our Vision is to be a Global Motorcycling Brand Our goal continues to be to catalyse and lead the global mid-size motorcycle market by making amazing and aspirational motorcycles that are still accessible, and a world of deeply engaging and frictionless experiences delivered by us, our partners, and
Slide 12: Launch of Classic in 2009 was an Inflection Point
Launch of “Classic” in 2009 was an Inflection Point Launch of Launch of 650 Launch of “Himalayan cc “Twins” Launch of new “Thunderbird” and “Continental ” “apparel & accessories” GT” 900 820 824 Thousands Transition of all models to “UCE” 698 666 600 508 Launch of “Classic” 303 300 178 53 113 52 75
Slide 13: Financial Highlights – Eicher Motors Ltd. (Standalone)
Financial Highlights – Eicher Motors Ltd. (Standalone) All figures are for Eicher Motors Limited Standalone (in Rs. Crs unless specified) Sales Volume Market Share* (India) Total Revenue (in Thousands) 27.0% Total revenue from operations (net of excise duty) 26.6% 24.0% 24.9% 666,493 820,492 823,828
Slide 14: Product Portfolio – Motorcycles
Product Portfolio – Motorcycles Royal Enfield range of motorcycles is able to address a unique mix of appeals – from its traditional customer base to urban, aspiration-driven youth Continental Interceptor Bullet Classic Thunderbird Himalayan GT 650 650 ▪ Longest ▪ Sense of ▪ Definitive ▪ Purpose-bui
Slide 15: More Choices with Variants of Bullet 350 and Classic 350
More Choices with the launch of Variants of Bullet 350 and Classic 350 New colour ways with contemporary Blacked out theme New Variant of Classic 350 New Variant of Bullet 350 ▪ Launched in two new colours - Pure Black ▪ Launched in six new colours - Silver, and Mercury Silver Sapphire Blue, Onyx Bl
Slide 16: Launch of BS VI Compliant Motorcycles
Launch of BS VI Compliant Motorcycles Lowered servicing cost by extending warranty and roadside assistance to 3 years Enhanced riding experience Classic 350 BS VI Himalayan BS VI ▪ First motorcycle under the Unit ▪ Himalayan BS VI comes with Switchable ABS Construction Engine (UCE) platform to that
Slide 17: Make Your Own - Personalization of Motorcycles
Make Your Own - Personalization of Motorcycles with Factory Fitted Accessories Customisation and personalisation at the “Make Your Own”, a first-of-its-kind initiative allowing a buyer core of a ‘Pure Motorcycling’ experience custom build a motorcycle with choice of accessories at the time of bookin
Slide 18: Make your own - Digital Configurator
Make your own - Digital Configurator Customer can customize his motorcycle on an in- store tablet and place the order directly to the manufacturing plant Real time updates via email notification sent to customer at each stage of enquiry, booking, dispatch and delivery INVESTOR PRESENTATION June 2020
Slide 19: Integrated Product Development Capabilities across UK and India
Integrated Product Development Capabilities across UK and India UK New Product Chennai Introduction (NPI) framework in place to develop best-in-class products in a minimal timeframe Next five year product pipeline in place ▪ UK Tech Centre at Bruntingthorpe, a hub for the ▪ The Chennai facility has
Slide 20: Solutions Business - Opportunity
Solutions Business - Opportunity Provide frictionless experience for RE Riders Explore new revenue / profit pool from adjacencies In Store Opportunity In Use Opportunity Spares Annual Maintenance Contract Accessories Apparel Road Side Assistance Extended Warranty Solutions Business - Financial Perfo
Slide 21: Product Portfolio – Apparel
Product Portfolio – Apparel Product EXTENSION Portfolio OF – Apparel STRENGTHENING ONE’S PERSONALITY THE SERVICE NETWORK Royal Enfield Apparels aim to become an extension of the owners’ personality. Inspired by the motorcycling way of life, the range is In an effort to improve the customer experienc
Slide 22: Product Portfolio – Motorcycle Accessories
Product Portfolio – Motorcycle Accessories Be it aesthetic enhancement or functional protection, catering to every individual's need with over 125 products in the portfolio Complete peace of mind with 2 years of manufacturer's warranty The motorcycle accessory product range will grow rapidly over th
Slide 23: Royal Enfield Garage Café, Goa
Royal Enfield Garage Café, Goa A celebration of exploration - through motorcycling, food, entertainment and personal expression ▪ Royal Enfield has set up its first Royal Enfield Garage Cafe in Arpora - Baga, Goa. ▪ The cafe is an inclusive and engaging space that reflects Royal Enfield motorcycling
Slide 24: Royal Enfield Garage Café, Goa
Royal Enfield Garage Café, Goa A unique space that embodies the pure motorcycling culture and lifestyle INVESTOR PRESENTATION June 2020 23
Slide 25: India - Industry Overview
India - Industry Overview Motorcycle Volumes Growth rate of various (India) in mn motorcycle segments -16.0% -23.0% India - largest motorcycle Premiumisation theme in motorcycle market in world market to continue Source - SIAM INVESTOR PRESENTATION June 2020 24
Slide 26: Opportunity – Domestic Market
Opportunity – Domestic Market India to become a US$9 trillion economy by 2030 India’s favorable demographics Indian Economy: A shift to a high growth path In 2030, 77% of India’s population will comprise Millennials and Generation Z Rising income Many India’s will drive consumption growth The expans
Slide 27: India Footprint
India Footprint 921 stores and 600 studio stores across 1,200 cities, plan to add another 600 stores by end of FY21 Dealer Network Store count Large Size Stores Studio Stores Total Large stores 1,521 Studio stores North 600 281 | 210 0 527 675 825 915 921 East FY16 FY17 FY18 FY19 FY20 169 | 143
Slide 28: Royal Enfield – Studio Stores
Royal Enfield – Studio Stores ▪ Over half of the studio stores are opened in UP, MP, Rajasthan, Odisha, Bihar, Andhra Pradesh, West Bengal where RE's market share is lower than its India average. ▪ Provide greater accessibility to sales and service in up-country markets ▪ 600 studio stores opened ti
Slide 29: Royal Enfield Vintage – Opportunity in Pre-owned Motorcycle Segment
Royal Enfield Vintage – Opportunity in Pre-owned Motorcycle Segment Vintage Store opened in Chennai, Bangalore, Delhi, Mumbai, Patna, Kanpur, Indore, Patiala, Hyderabad, Dehradun ▪ Pre-owned, refurbished and restored motorcycles - a first-of-its-kind in two- wheeler industry ▪ Accessible, hassle-fre
Slide 30: Opportunity – International Business
Opportunity – International Business The Oddity of the Motorcycle Industry Globally… is an opportunity CAGR:2012-18 Most Developing > 750cc Motorcycles Industries Markets -2% Industry 250-750cc 3% Premium -2% Mid Only Mid-sized motorcycle segment (250-750cc) has grown in the recent <250cc past in gl
Slide 31: International Footprint
International Footprint Plan to increase exclusive store count from 77 now to ~100 by end of FY21 Developed Markets Developing Markets Multi Multi Exclusive Exclusive Brand Brand Store Store Outlet Outlet North 1 120 APAC 24 72 America Countries with • Philippines – 1 Countries with exclusive stores
Slide 32: International Business - Key Priorities
International Business - Key Priorities Network Expansion & Touch Points International Business – New Retail formats - Studio Financial Performance over past 5 years stores, Shop-in-shop for Opportunity to double the revenue share of "INTERNATIONAL" apparel, and motorcycle business displays to incre
Slide 33: Awards
Awards Enfield Interceptor 650 won the Indian The Interceptor 650 won the Best Modern Motorcycle of The Year ("IMOTY") 2019 Classic Middle-Weight award at Thailand Bike of the Year 2019 The Interceptor 650 won the Best Retro RE’s Vallam Vadagal facility receives category bike award by MCN - the top
Slide 34: Digital Engagement with Community
Digital Engagement with Community #TripStory #MYBULLET Over 24,000 stories Rider Mania 2019 Over 13,000 stories received Over 8,000 participants received 7.4M Engagement 18M Views 36M views 22M Views What’s Your Royal Enfield Adventure? Custom World Live Over 14K Stories 480K Live! Views 3.4M Engage
Slide 35: Brand Health Report
Brand Health Report Top of Mind Awareness Top Two Box Consideration 50 43 42 44 43 90 77 77 40 41 41 42 75 75 75 75 73 76 45 38 39 80 72 72 40 70 35 60 30 50 25 (%) (%) 40 20 15 30 10 20 5 10 0 0 Average for the Period Average for the Period Royal Enfield brand remains strong in the minds of the c
Slide 36: Marquee Rides
Marquee Rides Rider Mania 2019 Himalayan Odyssey 2019 ▪ Rider Mania is Royal Enfield’s most ▪ The 16th edition of Royal Enfield ‘Himalayan definitive motorcycle festival and largest Odyssey’ saw 60 motorcyclists ride for 15 days gathering of RE enthusiast in the world. over 2,200 Km from Chandigarh
Slide 37: Brand Building Activities and Initiatives
Brand Building Activities and Initiatives SLIDESCHOOL ▪ Slideschool is a new initiative from Royal Enfield to bring in motorcycling enthusiasts from across the country to learn and enjoy flat tracking, one of the fastest growing forms of motorsports. ▪ The first ever Slideschool was successfully hel
Slide 38: Other Rides
Other Rides Royal Enfield Himalayan Royal Enfield Astral Ride 2019 Adventure Rongbuk 2019 ▪ Royal Enfield organised the first edition of Astral ▪ First-of-its-kind Indian manufacturer led Ride 2019 in September 2019, a first- of-its-kind expedition that is designed to take the riders ride that combi
Slide 39: Other Rides
Other Rides Tour of Thailand Winter White Out- Spiti 2020 ▪ The marquee ride - Tour of Thailand ▪ The 2nd edition of Winter White Out was witnessed its 3rd edition in 2020. The 6 day held from 20th February - 1st March from ride covering over 1,400 kms originated from Shimla to Spiti. Bangkok and en
Slide 40: Classic 500 Tribute Black – A Collector's Edition
Classic 500 Tribute Black – A Collector’s Edition Royal Enfield’s hallmark Unit Construction Engine (UCE) 500cc single-cylinder motorcycle was launched over a decade ago, in 2008 A commemorative end of production limited edition motorcycle “Classic 500 Tribute Black” was launched online. More th
Slide 41: Royal Enfield Stores
Royal Enfield Stores Milan, Italy New Delhi, India Chiang Mai, Thailand Buenos Aires, Argentina INVESTOR PRESENTATION June 2020 40
Slide 42: Oldest Motorcycle Brand in Continuous Production
Oldest Motorcycle Brand in Continuous Production INVESTOR PRESENTATION June 2020 41
Slide 43: Themes for RE's Sustainability journey
Themes for RE’s Sustainability journey Environmental Social Governance ▪ Water Positive ▪ Strategy, Execution and Monitoring ▪ Ride for a cause ▪ Carbon Neutral ▪ Risk Management ▪ Disaster Relief ▪ Zero Liquid Discharge ▪ Transparency ▪ Village upgradation programmes ▪ Zero Single Use Plastic ▪ Boa
Slide 44: Passion with Responsibility
Passion with Responsibility Committed to drive an active agenda towards the sustainability and the environment at large ▪ Successfully organized Rider Mania and Himalayan Odyssey with zero single-use plastics. ▪ With a focus on ‘Leave every place better’, the team collected over 3,000 kgs of recycla
Slide 45: VE Commercial Vehicles
INVESTOR PRESENTATION June 2020 44
Slide 46: VECV was Established in 2008 with Strong Parentage
VECV was Established in 2008 with Strong Parentage EICHER VOLVO STRENGTHS STRENGTHS Strong player in LMD Global expertise segment VECV vision Leadership in product Specialist skills and experience in developing low cost, better performance products “ To be recognised as the industry leader d
Slide 47: Milestones
Milestones AUGUST 2008: Signing of definitive agreements 2009: Inauguration of the new gear 2009: Launch of CSI-1 quality component plant at Dewas improvement initiative Jul-Aug 2008: Commencement of JV 2012: VEPDC inauguration 2012: CED paint shop inauguration 2010: Launch of VE-series of Eicher HD
Slide 48: Milestones
Milestones 2015: Inauguration of ‘Customer 2014: Volvo Trucks launch of new range 2014: Inauguration of Eicher retail Experience Center’ and ‘Vehicle display of products comprising FH, FM and FMX excellence center (VECV academy) zone’ 2016: Launch of Eicher Pro 1049 (Sub 5 Ton mini truck) 2017: Inau
Slide 49: Volumes
Volumes Total CV* Volumes Eicher Light to Medium Duty Eicher Heavy Duty Trucks (in nos) Trucks (3.5-15 tonne) (in nos) (16 tonne +) (in nos) 11,109 12,372 13,281 58,604 65,932 72,969 48,721 26,027 33,010 37,706 26,707 7,279 FY17 FY18 FY19 FY20 FY17 FY18 FY19 FY20 FY17 FY18 FY19 FY20 Buses Exports Vo
Slide 50: Market Share
Market Share Eicher Heavy Duty Trucks Eicher Light and Medium Duty Trucks In % (excluding exports) In % 31.5 31.3 29.4 29.5 4.9 5.1 4.6 4.5 FY17 FY18 FY19 FY20 FY17 FY18 FY19 FY20 Buses (excluding exports) In % VECV market share (including exports) In % 14.6 16.8 13.3 13.3 13.1 17.0 15.6 14.1 FY17 F
Slide 51: Financial Highlights – VE Commercial Vehicles
Financial Highlights – VE Commercial Vehicles All figures are for VE Commercial Vehicles (in Rs. Crore unless specified) Total Revenue* Total revenue from operations (net of excise duty) 8,553 10,049 11,600 8,524 FY17 FY18 FY19 FY20 EBITDA & Margin* Profit After Tax 1200 20% 18% 1000 16% 14% 800 12%
Slide 52: India Facilities – Manufacturing and Operations
India Facilities – Manufacturing and Operations *Abbreviation: EEC - Eicher Engineering Components VEPT - VE Power Train SEZ - Special Economic Zone HQ - Head Quarter INVESTOR PRESENTATION June 2020
Slide 53: VECV Trucks and Buses Distribution network
VECV Trucks and Buses Distribution network Eicher Truck & Bus Network Volvo Truck & Bus Network ▪ Dealer network 293 nos. including 25 COCO* outlets ▪ Hub and spoke network model ▪ 26 distributors, 96 Eicher Genuine Parts Shoppe and ▪ Sets benchmarks in the industry for vehicle uptime 1,900+ multi-b
Slide 54: Opportunities / Discontinuities VECV Edge
Opportunities / Discontinuities VECV EDGE Stricter emission & Safety Investing early in fully-built vehicles & emission norms Stronger regulations for overloading Building products apt for right-load & mild overload conditions Better infrastructure leading Building more reliable to higher speeds & m
Slide 55: Opportunities / Discontinuities VECV Edge
Opportunities / Discontinuities VECV EDGE Availability of trained drivers Driver training and regional academy Higher dependence on logistics Developing products aligned with evolving customer needs – Pro series Increased pressure on initial Institutionalization of cost acquisition cost VECV Edge re
Slide 56: Eicher LMD Trucks: A Significant Player
Eicher LMD Trucks: A Significant Player Eicher Pro 2000 series (3.5-16 Ton GVW) Volumes (including exports) (in nos) Eicher Pro 3000 series 4,840 (12-16 Ton GVW) 488 2MFY20 2MFY21 Note: In April 2020, the company's manufacturing facilities and dealerships in India remained closed, in compliance INVE
Slide 57: Eicher LMD Trucks: Launch of Pro 2000 Series
Eicher LMD Trucks: Launch of Pro 2000 Series Unveiled India’s first BS VI compliant CV range in Designed to deliver significantly higher profitability, June 2020 enhanced reliability, safety, comfort and efficiency Introduction of many industry-first features such as Additional features like low tur
Slide 58: Eicher HD Trucks: To Leverage Full Potential
Eicher HD Trucks: To Leverage Full Potential….. Achieved market share of 5.1% in 2019-20, highest in 10 years Volumes Pro 8000 series (in nos) 1,575 Steadily growing market share With over 20,000 trucks on road, the ‘Pro’ series is gaining more traction with increased interest in technologically adv
Slide 59: Volvo Trucks: Market leader in Premium Truck segment
Volvo Trucks: Market leader in Premium Truck segment Volumes (in nos) 130 FMX 460 8X4 (Coal Tipper) 31 Leadership in niche segments 2MFY20 2MFY21 Note: In April 2020, the company's manufacturing facilities and dealerships in India remained closed, in compliance with the Government directives. FM 420
Slide 60: Eicher Buses: Steady Market Share in a Challenging Environment
Eicher Buses: Steady Market Share in a Challenging Environment Volumes (including exports) (in nos) 2,217 114 2MFY20 2MFY21 Note: In April 2020, the company's manufacturing facilities and dealerships in India remained closed, in compliance with the Government directives. Electric Pro E INVESTOR PRES
Slide 61: Tapping Global Potential
Tapping Global Potential Acquired key customer “Value Group in South Africa” Bus portfolio ramped up for Middle East; Market share gained in the region Exports 523 ▪ Market share gain across all regions of international business, even in (in nos) declining total industry volume ▪ Over 36 new product
Slide 62: World Class Manufacturing set up
World Class Manufacturing set up... ▪ Capacity to produce up to 90,000 trucks from single plant; new plant set-up under progress to take capacity to 130,000 per annum ▪ Production of 44,969 vehicles in FY20 ▪ Highly flexible vehicle assembly lines with right blend of technology to control critical p
Slide 63: VE Powertrain
VE Powertrain ▪ First engine plant in India producing Euro-6 compliant base engine ▪ Exclusive manufacturing hub for medium duty engine requirements of Volvo Group ▪ Current capacity of 50,000 engines, scalable up to 100,000 engines ▪ Best executed project with Volvo Group technology with frugal app
Slide 64: Proposed New Plant in Bhopal
Proposed New Plant in Bhopal Master Layout Engine line building Current Status Proposed ▪ ETB plant capacity ▪ Project commenced in October 2018 with proposed capacity of 40,000 per annum 90,000, ▪ Overall project on track for 2020-21 start deliverable 80,000 ▪ Planned capital outlay of around Rs. 4
Slide 65: Other VECV Business Areas
Other VECV Business Areas Eicher Engineering Components (EEC) ▪ Strategic supplier of drive line components and aggregates for VECV, The Volvo group, exports and strategic domestic OEM customers ▪ Production facilities at: Thane, Dewas and SEZ, Pithampur ▪ Annual turnover of Rs.757 Crores in FY20 IN
Slide 66: Other VECV Business Areas
Other VECV Business Areas Eicher Non - Automotive Engines ▪ Presence in 10 countries, Genset Assembly in UAE & South Africa, pan India presence in Genset segment ▪ Reputed as most reliable and lowest operating cost engines, established in material handling segment ▪ Engines and drivelines for power,
Slide 67: Financials
Financials INVESTOR PRESENTATION June 2020 66
Slide 68: Quarterly Financial Highlights (Standalone)
Quarterly Financial Highlights (Standalone) Eicher Motors – Standalone* performance in last 5 years… (in Rs. Cr) 900 35.0% 31.8% 31.4% 31.4% 31.9% 31.7% 32.3% 32.3% 30.8% 31.3% 30.6% 800 29.6% 29.5% 28.6% 30.0% 27.7% 27.8% 700 26.1% 26.4% 25.9% 25.0% 25.0% 25.2% 23.6% 25.0% 600 20.8% 500 20.0% 400 1
Slide 69: Thank You
Thank You Get Social Royal Enfield Royal Enfield VE Commercial Vehicles INVESTOR PRESENTATION June 2020
Slide 70: Appendix
Appendix INVESTOR PRESENTATION June 2020 69
Slide 71: Balance Sheet (Consolidated)
Balance Sheet (Consolidated) (In Rs. Cr.) Particulars Mar’18 Mar’19 Mar’20 Net Fixed Assets (including CWIP and Pre-operative Expenditure) 1,835 2, 324 2,690 Investments 5,581 4,923 5,749 Other Non Current Assets 186 180 102 Current Assets Inventories 395 633 572 Debtors 68 90 87 Cash and Bank Balan
Slide 72: Profit & Loss Statement (Consolidated)
Profit & Loss Statement (Consolidated) (In Rs. Cr.) Profit & Loss Account FY2018 FY2019 FY2020 Sales Volume: Two Wheelers (Nos.) 820,121 822,724 697,582 Total revenue from operations (net of excise) 8,965 9,797 9,154 Manufacturing and other expenses 6,157 6,894 6,973 Earnings before interest, deprec
Slide 73: Glossary
Glossary ▪ 7M – 7 months starting April to October ▪ JV – Joint Venture ▪ 9M – 9 Months starting April to December ▪ LCV – Light Commercial Vehicles ▪ 10M – 10 Months starting April to January ▪ LMD – Light to Medium Duty ▪ 15M – 15 months ended on 31st March 2016 ▪ M&HCV – Medium and Heavy Commerci