Investor Presentation a February 2018
Contents EICHER MOTORS LIMITED - OVERVIEW ROYAL ENFIELD VE COMMERCIAL VEHICLES EICHER POLARIS FINANCIALS 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 the Company with the requirements of Companies Act, 2013. Therefore the reporting year for 2015-16 commenced on January 1, 2015 and ended on March 31, 2016, being a period of 15 months. However, to have comparability in the numbers from previous reported years, the presentation captures un-audited financials for FY15-16 (April 1st 2015 to March 31st 2016). INVESTOR PRESENTATION 2 February 2018
EICHER MOTORS LIMITED - OVERVIEW INVESTOR PRESENTATION 3 February 2018
Key Milestones Enters heavy Forms JV* with AB Volvo India’s first duty of Sweden; transfers Commencement tractor rolls out Royal Enfield trucks commercial vehicle of business by of Eicher factory motorcycles segment business to the JV* Eicher Polaris in Faridabad acquired 1959 1984 1991 1993 2002 2005 2008 2012 2015 JV* with JV* with Divests tractor & allied Forms JV* with Mitsubishi Mitsubishi businesses to focus on Polaris Industries Inc. Motors to make ended, enters commercial vehicle & USA, to design, ‘Canter’ trucks medium duty motorcycle businesses manufacture & market bus segment personal vehicles *Joint Venture INVESTOR PRESENTATION 4 February 2018
Shareholding Pattern (31 st December 2017) Domestic Foreign Institutional Institutional Investors Investors Promoter Group Others 4.86% 12.48% 50.53% 32.13% 100% 0% 10% 20% 30% 40% 50% 70% 80% 90% 60% Eicher Motors Limited Volvo Group Polaris Industries 45.6 Business unit of 50 50 Eicher Motors 54.4 Limited VE Commercial Royal Enfield (RE) Eicher Polaris (EPPL) Vehicles (VECV) RE Brazil (Royal RENA (Royal Enfield Brasil Enfield North Comercio de America Ltd.) Motocicletas Ltda) “Multix” 1 st Personal Eicher Trucks & Buses Motorcycles Business Volvo Trucks Utility Vehicle INVESTOR PRESENTATION 5 February 2018
Eicher Management Philosophy Break-through emerging Established Corporate Strong Values market business model Governance An evolved business model Fully empowered Corporate conduct rooted with 50+ years of management teams in highest standards of experience in automotive ethics, integrity & space in India Annual 3 year rolling transparency business plan In-depth customer insights Highly professional work & market understanding Strategic quarterly board ethic based on mutual meetings – full review with respect Best-in-class capital management optimization : Very strong HR & IR culture Frugal engineering Strategic quarterly reviews and brand practices ®ular monthly Extensive knowledge of operations review Long-term orientation suppliers Operational excellence Product board, Quality Long history of Global quality board, Customer institutionalized CSR & standards satisfaction board, Soft community activities product board (after- Low cost supply chain & market) held every quarter distribution – value chain along with other statutory meetings INVESTOR PRESENTATION 6 February 2018
Board Eicher Motors Limited VE Commercial Vehicles Eicher Polaris Pvt. Ltd S Sandilya Hakan Karlsson Michael D. Dougherty Non-executive Chairman Chairman Chairman Siddhartha Lal Vinod Aggarwal Pankaj Dubey Managing Director & CEO Managing Director & CEO CEO & Whole Time Director MJ Subbaiah Siddhartha Lal Siddhartha Lal Independent Director Eicher Nominated Director Eicher Nominated Director Prateek Jalan Jacques Michel Lalit Malik Independent Director Volvo Nominated Director Eicher Nominated Director Manvi Sinha Philippe Divry B Govindarajan Independent Director Volvo Nominated Director Eicher Nominated Director Raul Rai Michael Todd Speetzen Eicher Nominated Director Polaris Nominated Director Prateek Jalan Independent Director Lila Poonawalla Independent Director INVESTOR PRESENTATION 7 February 2018
Business Highlights – FY 2016-17 ^ 0 666,493 95% EML continues to be Motorcycles sold in FY17, Royal Enfield’s market Debt free company 6x in last 5 years share in the mid-size motorcycles* segment 31.3% 33.5% Royal Enfield EBITDA VE Commercial Vehicles margin in FY17, benchmark market share in domestic LMD # segment in automobile industry Source – SIAM and Company Analysis ^ All figures mentioned are Standalone for period 1 st April’16 to 31 st March ’17 INVESTOR PRESENTATION 8 *Mid size motorcycles refers to engine capacity between 250cc – 750cc February 2018 # Light to Medium Duty (4.9 to 15 ton)
ROYAL ENFIELD INVESTOR PRESENTATION 9 February 2018
Oldest motorcycle brand in continuous production INVESTOR PRESENTATION 10 February 2018
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 Bullet Classic Thunderbird Continental GT Himalayan Longest production Sense of Definitive highway Fun, youthful Purpose-built for motorcycle distinctiveness tourer exploring the Himalayas Classic -Sport Resolute, Post-war styling Long range & load- Versatile for riding unchanged form bearing capabilities Distinctive Style on- & off-road Timeless design Pride of the For the free-spirited Fully ground-up armed forces explorer with all-new engine Iconic cues – Touring capabilities thump, pinstripes, road presence Traditional & Iconic Urban, Lifestyle and now Adventure INVESTOR PRESENTATION 11 February 2018
The Twins are Here The Interceptor and the Continental GT, powered by the 650 Twin. Heritage-inspired machines that carry the Royal Enfield legacy and character into the 21st century Continental GT Interceptor INVESTOR PRESENTATION 12 February 2018
Royal Enfield aims to lead and expand the mid-weight motorcycle segment globally Parallel Twin Cylinder Engine Interceptor 650 & Continental GT 650 New platform is a single overhead cam, 8 valve, The new 650 twins offers a compelling upgrade to the large air/oil-cooled, 648cc parallel twin, producing 47bhp base in India and 52Nm An attractive proposition to customers from other developing Royal Enfield aims to lead and grow the mid-weight markets in South East Asia and Latin America to graduate to (250-750cc) motorcycle segment globally, and the middle weight segment Interceptor 650 and Continental GT 650 will help A very evocative option to customers in mature motorcycle grow this segment markets such as Europe, Australia and North America INVESTOR PRESENTATION 13 February 2018
Product Portfolio – Gear Launched in October 2012, Royal Enfield Gear bears quintessential Royal Enfield hallmarks – craftsmanship, durability and attention to detail. Stealth Black Gear Gear for Twins Royal Enfield Gear business Royal Enfield has a history of models with parallel twins. So we launched stealth black gear not only went back to our archives when we started building the along with stealth black twins but also ensured that they are relevant for today. motorcycles. The Stealth Black collection is inspired by the motorcycling way of life. A thematic campaign has been designed, showcasing how this collection truly celebrates the relationship of riders with their machines. NSG Motorcycling Expedition: Tribute to the Bravehearts 15 bravehearts from NSG headed on an epic motorcycling expedition, riding 8000 kms through 13 states in an initiative to educate general population in We followed a similar process while developing the Gear for fighting back terrorism. the Twins. We are inspired by our history, by the cultural contexts in which these two models were originally Royal Enfield was a humble supporter of this initiative, providing introduced. At the same time, we have designed the Gear to the Commandos with the apt Classic 500 Stealth Black motorcycles be relevant for today. along with the Protective Gear. Also, the motorcycles ridden by the NSG commandos were put on sale & proceeds of the sale have gone to a non-profit organization- Prerna, supported by the NSG Units. INVESTOR PRESENTATION 14 February 2018
Launch of “Classic” in 2009 was an inflection point Launch of new “ Thunderbird ” and Launch of Launch of “ apparel & accessories ” “ Continental GT ” “ Himalayan ” Transition of all models 666,493 80% 700,000 70% to “ UCE ” 68% 593,449 70% 600,000 57% 508,099 60% 52% Launch of 500,000 “ Classic ” 50% 42% 400,000 302,592 40% 300,000 30% 20% 31% 178,121 18% 200,000 13% 20% 113,432 52,576 7% 74,626 100,000 51,955 43,298 36,786 32,642 10% 1% 0 0% CY06 CY07 CY08 CY09 CY10 CY11 CY12 CY13 CY14 FY16 FY17 9MFY18 RE Volumes Y-o-Y Growth Note: Standalone volumes for Eicher Motors Limited 22.5% Volumes grew by 50% CAGR during the period CY10 to FY17 671,328 547,938 10M'17 10M'18 INVESTOR PRESENTATION 15 February 2018
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