Investor Presentation June 2017 Stock Codes: BSE: 504973 NSE: TUBEINVEST Bloomberg: TI IN / TI IB Reuters: TUBE.NS / TUBE.BO CIN: L35921TN1949PLC002905 Tube Investments of India Limited 1
Index Contents Table of Contents Page No Corporate Profile 3 Manufacturing Businesses Engineering 20 • Cycles and Accessories 31 • Metal formed products 44 • Gears and Gear Products – Shanthi Gears Limited 62 • Financial Service Businesses Cholamandalam Investment and Finance Company Limited 72 • Cholamandalam MS General Insurance Company Limited 73 • 2
Murugappa Group and Philosophy Market Company Name Description Gross Sales Share Capitalisation Other Cholamandalam Investment and Finance Company Limited is a 2% Non Banking Finance Company and one of the leading financial INR 1,50,722 Mn. CUMI EID provider for vehicle finance, business finance, home equity loans, (USD 2,325 mn) stock broking & distribution of financial products 15% 7% TII Tube Investments of India Limited offers wide range of Chola 15% engineering products such as Steel Tubes, Chains, Car door INR 1,17,652 Mn. MS frames, Fitness equipment and Cycles (USD 1,815 mn) 11% Coromandel International Limited is the second largest CIFCL phosphatic fertilizer company in India INR 91,234 Mn. Coroma 16% (USD 1,407 mn) ndel 34% EID Parry (India) Limited, one of the largest player in the market, offering wide range of agro products such as sugar, INR 49,839 Mn. microalgal health supplements and bio products (USD 769 mn) FY 2016-17 EBITDA Share Carborandum Universal Limited is a pioneer in coated and Other bonded abrasives, super refractories, electro mineral and INR 54,900 Mn. 3% industrial ceramics. The Company currently has presence in (USD 847 mn) Australia, South Africa, Russia, Canada and Middle East EID CUMI Cholamandalam MS General Insurance Company Limited is a JV 15% 9% of Murugappa Group with Mitsui Sumitomo Insurance Group of TII Unlisted Japan, (5th largest insurance group across the globe) Chola MS 12% 8% Note: Market data as on 31 st March 2017. Source: BSE Sensex and Conversion Rate of 1USD = Rs.64.8386 as on 31 st March 2017 Source: RBI Coroman del CIFCL 25% 28% The fundamental principle of economic activity is that no man you transact with will lose; then you shall not. 3 FY 2016-17 - Arthashastra
TII Milestones • TI Cycles setup with BSA and Hercules 1949 Brands • Entered Precision tubes with 1955 incorporation of Tube Products of India • Entered Chains business with 1960 incorporation of TI Diamond Chains Limited 1965 • TI Metal Forming setup • Promoted Cholamandalam 1978 Investment and Finance Company Ltd • Indigenously manufactured 100 CC bike 1985 chain 4
TII Milestones • Promoted Cholamandalam MS General 2001 Insurance along with JV Partner Mitsui Sumitomo Insurance , Japan 2010 • Acquired SEDIS, France 2012 • Acquired Shanthi Gears Ltd, a listed Company • Entered into Large Dia Tube manufacturing 2014 • Promoted TI Tsubamex Pvt Ltd along with JV Partner Tsubamex Company , Japan • TI sold 14% stake in Cholamandalam MS General Insurance Company to JV Partner, Mitsui Sumitomo Insurance • Investment in TI Absolute Concepts Pvt Ltd with 2016 Ciclo Café brand, a bicycle theme based restaurant and retail • Board approves Demerger proposal to segregate 5 manufacturing and financial services businesses
List of Subsidiaries and Joint Ventures figures in INR Mn. FY 2016-17 % Company Nature of Business Total Shareholding PAT Income Financiere C10 SAS (FC 10) Manufacturing of Chains 100% 2,323 12 Shanthi Gears Limited (SGL) Manufacturing of Gears 70.1% 2,146 225 Design and TI Tsubamex Private Limited (TTPL) 75% 52 (63) Manufacturing of Dies TI Absolute Concepts Private Limited Bicycle Theme Based 50% 27 (54) (TIACPL) Restaurant & Retail Cholamandalam MS Risk Services Limited Risk services 49.5% 366 17 (CMSRSL) Cholamandalam Investment and Finance Financial Services 46.2% 46,922 7,980 Company Limited (CIFCL) Cholamandalam MS General Insurance General Insurance 60% 27,624 2,084 Company Limited (CMSGICL) Business TI Financial Holdings Limited (TIFHL) - 100% - - 6
Corporate Overview Manufacturing Businesses • Engineering Segment (Tubes, Value Added Cold Key Financials (TII Consolidated) – IND AS Rolled Strips, & Tubular Components) INR Mn. 2016-17 2015-16 % Gr • Cycles and Accessories (Bicycles & Fitness Revenue from Operations 115,206 103,241 12% Products) EBITDA 19,606 17,767 11% • Metal Formed Products (Chains for Automobile PBIT 17,838 16,203 10% sector & Industrial applications, Doorframe & PBT (Before Exceptional 17,033 14,809 15% Channels for Passenger Cars) Items) • Gears and Gears Products (Investment in Exceptional Items 0 (358) PBT (After Exceptional Shanthi Gears Limited – Industrial Gears) 17,033 14,451 18% Items) • Others (Investment in TI Tsubamex Private Net Profit 11,751 7,887 49% Limited – Designing & Manufacturing of Dies) • 25 Manufacturing Locations and Suppliers to all TII Standalone – As per IND AS major automotive OEM’s or Tier 2/3 Suppliers INR Mn. 2016-17 2015-16 % Gr Revenue 42,078 40,414 4% • TI Absolute Concepts is formed as a 50:50 Joint Venture in the business line of Bicycle Theme EBITDA 3,601 3,503 3% based Restaurant and Retail PBIT (Before Exceptional 3,099 2,757 12% Items) Investments in Financial Services Exceptional Items 0 7,850 Cholamandalam Finance (46.2%) • PBIT (After Exceptional 3,099 10,607 -71% Items) Cholamandalam MS Insurance (60%) • Net Profit 1,962 7309 -73% Cholamandalam MS Risk Services (49.5%) • 7
TII (Standalone) Businesses Engineering Cycles and Accessories Metal Formed Products ERW & CDW Tubes, Chains for Automobile sector & Bicycles, Value Added Cold Rolled Strips & Industrial applications, fitness products and Doorframe & Tubular Components accessories Channels for Passenger Cars • Leader in Chains and Fine blanked components Second largest bicycle producer Largest Supplier of Precision Steel Tubes • Preferred supplier for roll-formed door (CDW) in India frames 8
Share Price and Shareholding Pattern Shareholding Pattern 100% 23.90% 26.20% 25.90% 25.70% 25.40% 80% 9.60% 11.10% 12.20% 14.40% 12.30% 60% 16.30% 14.70% 13.20% 13.20% 12.90% 40% 48.30% 48.20% 48.90% 48.80% 48.80% 20% 0% Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Promoter FII DII Others 31 st Mar 2017: INR 627.65 Share Price Movement 800 700 600 500 400 300 200 100 0 31-Mar-12 30-Jun-12 30-Sep-12 31-Dec-12 31-Mar-13 30-Jun-13 30-Sep-13 31-Dec-13 31-Mar-14 30-Jun-14 30-Sep-14 31-Dec-14 31-Mar-15 30-Jun-15 30-Sep-15 31-Dec-15 31-Mar-16 30-Jun-16 30-Sep-16 31-Dec-16 31-Mar-17 Uninterrupted dividend history since 1954 Dividend payout policy ~25-30% of profits 9
Key Standalone Financials 2016-17 figures in INR Mn. FY Particulars % Growth 2016-17 2015-16 Gross Sales / Income from Operations 42,078 40,414 4% Total Income from Operations 44,159 42,120 5% EBITDA 3,601 3,503 3% % to Gross Sales 9% 9% PBIT (before exceptional items) 3,099 2,757 12% % to Gross Sales 7% 7% Exceptional Items 0 7,850 PBIT (after exceptional items) 3,099 10,607 -71% % to Gross Sales 7% 26% Profit Before Tax (before exceptional items) 2,379 1,403 70% % to Gross Sales 6% 3% Profit Before Tax (after exceptional items) 2,379 9,253 -74% % to Gross Sales 6% 23% 10
Performance Trends Gross Sales figures in INR Mn. 44,000 42,078 42,000 40,414 39,162 40,000 38,000 36,423 36,094 36,000 34,000 32,000 2012-13 2013-14 2014-15 2015-16 2016-17 Note: Gross Sales include Excise Duty to comply with IND AS and figures has been suitably adjusted EBITDA and EBITDA% 4,000 3,601 3,503 14.0% 3,500 3,193 3,015 2,983 12.0% 8.6% 3,000 8.7% 8.2% 10.0% 8.4% 2,500 8.2% 8.0% 2,000 6.0% 1,500 4.0% 1,000 2.0% 500 - 0.0% 2012-13 2013-14 2014-15 2015-16 2016-17 11
Performance Trends figures in INR Mn. PBIT and PBIT% (Before Exceptional Items) 3500 7.6% 3099 2757 3000 7.4% 2644 7.4% 2595 2552 7.3% 2500 7.2% 2000 7.0% 7.0% 6.8% 1500 6.8% 6.6% 1000 6.6% 500 6.4% 0 6.2% 2012-13 2013-14 2014-15 2015-16 2016-17 ROCE% 20% 16% 16% 14% 14% 13% 13% 12% 8% 4% 0% 2012-13 2013-14 2014-15 2015-16 2016-17 12 Based on Average Capital Employed excluding investments in Financial Services Businesses
Performance Trends figures in INR Mn. PAT 7,309 10000 6327 1,209 1000 367 1962 1040 941 982 842 100 2012-13 2013-14 2014-15 2015-16 2016-17 PAT (Before Exceptional Items) Exceptional Item Dividend Per Share - in INR Face Value Per Share - INR 2 6 5* 5 4 3 2 2 2 2 1.25^ 1 0 2012-13 2013-14 2014-15 2015-16 2016-17 *Includes Special Dividend of INR3.50 per Share ^ Interim Dividend Dec’ 16 of INR 1.25 per Share 13
Performance Trends Earnings Per Share (Basic)- In INR Face Value Per Share - INR 2 50.00 * 39.04 40.00 30.00 20.00 10.47 6.46 10.00 5.58 5.04 0.00 2012-13 2013-14 2014-15 2015-16 2016-17 *Higher due to exceptional income (Net). Earnings per Share on Normal profits would be INR 5.24 (2014-15 : INR 4.50) Face Value Per Share - INR 2 Book Value Per Share - INR 112.75 120.00 108.13 100.00 80.00 70.57 66.29 63.28 60.00 40.00 20.00 0.00 2012-13 2013-14 2014-15 2015-16 2016-17 14
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