Commercial Engineers and Body Builders Co Ltd. (CEBBCO) Investor Presentation November 2011
Important Notice Forward Looking Statements This presentation contains statements that contain “forward looking statements” including, but without limitation, statements relating to the implementation of strategic initiatives, and other statements relating to CEBBCO’s future business developments and economic performance. While these forward looking statements indicate our assessment and future expectations concerning the development of our business, a number of risks, uncertainties and other unknown factors could cause actual developments and results to differ materially from our expectations. These factors include, but are not limited to, general market, macro-economic, governmental and regulatory trends, movements in currency exchange and interest rates, competitive pressures, technological developments, changes in the financial conditions of third parties dealing with us, legislative developments, and other key factors that could affect our business and financial performance. CEBBCO undertakes no obligation to publicly revise any forward looking statements to reflect future / likely events or circumstances 2
Agenda 1. Investment Highlights 4 2. Business Overview 5 3. Strategy 11 4. Management and Board of Directors 12 5. Financial Overview 14 6. Industry Overview 18 7. Corporate Social Responsibility 20 3
Investment Highlights Strong Market One of the leading producers of tippers and load bodies for defence and domestic market Position Comprehensive product portfolio in commercial vehicles for application across industries Presence across 3 segments of railways rolling stock – locomotives, coaches and wagons Opportunity Expansion in the high growth power fabrication segment with strong customer recognition Attractive Growth State of the art railway wagon plant with latest machinery and equipment Exposure to the high growth infrastructure sectors in India – Road transport and railways Operational Blue chip customer base with focus on diversification Excellence Strategically placed manufacturing facilities with proximity to customers and vendors Design and engineering capabilities provide high quality and industry leading standards 4
Diverse Product Portfolio Commercial Vehicles Application Products Mining & Road • Tipper bodies Construction • Tanker bodies • Refrigerator-fitted vehicle bodies /containers Goods • Load cargo bodies Transportation • Trailer bodies Solid Waste • Skip loaders Management • Garbage bin collectors • Water tanker bodies Municipal • Light recovery vehicle bodies Applications • Garbage tippers • Troop carrier vehicle bodies Defense • Prison van bodies • Water bowser bodies • Vehicle bodies for transportation of animals Miscellaneous • Fire engine bodies Applications Ambulance bodies • 5
Diverse Product Portfolio Railways Application Products • Upgradation and refurbishment of BOXN wagons Railways • Components for locomotives • Components for BOXNR wagons Components Components for coaches • Power Application Products • Structurals for boilers and electrostatic Boilers and ESP precipitators (ESPs) 6
Blue Chip Customer Base Top Customer Accounted for 63% of Total Sales in FY2011 Compared 74% in FY2008 2008-11 Revenue CAGR (%) 100 80 36% 60 (%) Revenue 40 Contribution 15% by Client 20 0 2008 2011 Top Client Other Clients Commercial Vehicles Railways Power Above clients are arranged alphabetically 7
Strategically Placed Manufacturing Locations Location in Central India Provides Competitive Advantage Proximity to Customers Jabalpur serves as a central location to major OEM hub across India Near key customer in Indore and Jamshedpur Proximity to Suppliers Indore (1) Jabalpur (4) Strategically located closer to the Jamshedpur (1) suppliers of steel in Orissa and Jharkhand Other Locational Advantages Manufacturing facilities (6) Lower labour, land and overhead Major OEM hubs in India costs provides advantage over other locations Suppliers of Raw Material Benefits under the Madhya Pradesh Industrial Investment Promotion Assistance Scheme, 2004 8
State of the Art Manufacturing Facilities Focus on Technology and Quality Factory Locations Research & Development Quality Certifications ISO 9001:2008 Richhai I, Jabalpur Certificate for Quality Management System Mandla, Jabalpur for Automobile Bodies and Components for Richhai II, Jabalpur Commercial Weld Testing and Training Facility Vehicles 20 engineers to develop new designs for a range of products Indore First Indian company to manufacture a complete stainless ISO 9001:2008 steel tipper; under evaluation by Certificate customers Jamshedpur for Quality Manufactured a unique bulker that Management carries fly ash on one side and System clinkers on the other side for the for Railways New Railway Plant, most optimum utilization Products State of the art reefer plant to Jabalpur manufacture refrigerated vans as per European ATP (food grade) standards 9
Integrated Manufacturing Process Manufacturing Process Supported by World Class Infrastructure Machine shop Inspection as Receipt of operation per check list Order Sub-assembly Final finishing Advance Product Quality Planning Product Part Approval Process Failure Mode and Effect Analysis Cleaning and Document check rust proofing Tooling Final fitment / cubbing assembly Dispatch Raw material procurement Final painting Order receipt and procurement Manufacturing process Fitting of Quality check and dispatch accessories Numerical Five-ton 200 and 300 Robotic Computerized Centralized control Shot blasting electric cubic feet per fabrication numerical gas bank for Paint booth shearing booth operated minute system control press welding machine trolley compressors 10
Growth Strategy Leverage Existing Capabilities to Expand Product Offering and Mitigate Risk Commercial Vehicles Railways • Expand presence in • Strong expected demand from emerging sub segments Indian Railways Consolidate market position Setting up a wagon and EMU • • and win new clients coach manufacturing plant in Jabalpur • Focus on business from private fleet owners • Aggressively bid for new railway World Class tenders Manufacturing • Strengthen relations with existing customers Facilities • Leverage partnership in the State of the Art refrigerated segment Technology Experienced Management Team Power Power • Capitalize on strong demand • Continued focus on power structurals, i.e. ESPs and boilers • Brownfield expansion ongoing 11
Management & Board of Directors Experienced Management Team Key Executives Background Dr. Kailash Gupta • Over 30 years of industry experience Chairman and Managing • Former President of the Federation of Automobile Dealers Associations (FADA) Director • Currently an active member of FADA Governing Council • He holds a post graduate degree in Physics from DAV College, Meerut University. He was awarded a Doctorate degree by the Jabalpur University Ajay Gupta • Instrumental in conceiving and extending business in the railways industry Executive Director • A Commerce graduate from University of Mumbai and has completed a one- year Business Leaders Programme from IIM, Kolkata Amit Kumar Jain • Over 15 years of experience in finance, taxation and accounts Chief Financial Officer • A Chartered Accountant from the Institute of Chartered Accountants of India Abhishek Jaiswal • Over 18 years of experience in sheet metal fabrication and 3 years in the automobile industry Executive Vice President • Currently responsible for production and operations • Holds a graduate degree in Production Engineering from GSI, Indore Pradeep Gupta • Over 30 years of experience in project management, manufacturing, marketing, product engineering, vendor development and export execution in the railway industry Executive Vice President, Railways • Holds a graduate degree in Mechanical Engineering from Punjab Engineering College, Chandigarh 12
Management & Board of Directors Board of Directors Dr. Kailash Gupta Ajay Gupta Chairman and Managing Whole-time Executive Shyam Mani Director Director Akhil Shriprakash Awasthi Managing Director, Tata Motors Finance (a 100% Managing Partner, Tata subsidiary of Tata Motors) Capital Private Equity Experienced and Independent Board Members Sevantilal Popatlal Shah Ravi Gupta Retired General Sales Industrialist Manager, Tata Motors Sudhir K Vadehra Arun Kumar Rao Managing Director, Retired Director General, Kewaunee Labway RDSO, Lucknow (Singapore) Independent Directors Non-Executive Directors Key Board Member Background Shyam Mani • Currently Managing Director of Tata Motors Finance, a 100% subsidiary of Tata Motors Additional Director • Previously Mr. Shyam Mani was VP, Sales and Marketing at Tata Motors Commercial Vehicles Business Unit Arun Kumar Rao • Served Indian railways for 38 years and retired as Director General, RDSO, Lucknow Independent Director • Graduate from BITS, Pilani and the Institution of Mechanical Engineers, London Sevantilal Popatlal Shah • Retired General Sales Manager, Tata Motors and is currently the Director General of Federation of Independent Director Automobile Dealers Associations • He is a qualified Mechanical Engineer 13
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