m&m investor presentation · 5 life insurance corporation of india golboot holdings ltd...
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1Copyright © 2012 Mahindra & Mahindra Ltd. All rights reserved. 1
Feb. 2014
M&M Investor Presentation
2
Business Sectors
Automotive & Farm Equipment
Aftermarket
Hospitality
Mahindra Partners (Steel, Retail, Trade, Logistics, Boats,
Energy, Media)
2 Wheeler
Systech
Information Technology
Real Estate
Defence Systems
Financial Services
The Mahindra Group comprises 10 business sectors with a presence in 18 Industries
3
Mahindra Group
Market leader in Utility Vehicles in India
Market leader in Tractors in India.
Number One Global tractor manufacturer (Single legal entity)
Mahindra Finance : Leader in rural financing
Tech Mahindra : Leader in Telecom Software
Mahindra Holidays : Leader in ‘Time Share’
Business Leadership
4
Mahindra & Mahindra Ltd.
M&M is one of India's leading utility vehicle and tractor
manufacturers
Market leader – for 9MFY14 – in UVs (market share 41.1%) and in
Tractors (market share 41.4%)
Equity Structure of the company –
– 25.2% Promoter & Promoter Group, 74.8% Public (45.6% Foreign)
As at Dec. 31, 2013
Manufacturing plants all across India –
– Auto plants – 6, Tractor plants – 7, Foundry plant – 1
– Subsidiaries – Total - 119 , Operational – 59 As at Dec..31, 2013
Company Overview
5
Life Insurance Corporation of India
Golboot Holdings Ltd (Goldman Sachs)
Dodge & Cox
ICICI Prudential Life Insurance Ltd
First State Investments
Capital Group
General Insurance Corporation of India
Government of Singapore
The New India Assurance Company Ltd
Vanguard Emerging Markets Stock
Index Fund
J P Morgan Group
Top 10 Shareholders with > 1%
Shareholding Pattern …. 31 Dec. 2013
Promoter and
Promoter Group 25.2%
FII / NRI / GDR
45.5%
Insurance Cos.
14.5%
FI / MF / Banks1.5%
Individuals13.3%
6
Financials
7
Financial Highlights
Growth in Total income
Rs 11,270 crs
Rs 11,522 crs
-2%
Q3 – FY14 Vs Q3 – FY13 (M&M + MVML)
Rs 1,533 crs
Rs 1,380 crs
11%
Rs 1,000 crs
Rs 915 crs
9%
Growth in EBIDTA Growth in PATGrowth in PAT
8
Financial Highlights
Growth in Total income
Rs 43,655 crs
Rs 35,005 crs
25%
FY13 Vs FY12 (M&M + MVML)
Rs 5,329 crs
Rs 4,150 crs
28%
Rs 3,634 crs
Rs 2,997 crs
21%
Growth in EBIDTA Growth in PAT
Rs 3,544 crs
Rs 2,740 crs
29%
Growth in PAT
* On like to like comparison, excluding one time benefit of Rs. 257
crores on account of MADPL merger from FY 2012 & Rs. 91 crs in FY 13
of Exceptional Gain on sale of MHRIL shares
Adjusted PAT*
9
Strong Growth Trajectory
Gross Revenue & Other Income PAT
861
2,068
2,6872,997
3,634
FY09 FY10 FY11 FY12 FY13
(M&M + MVML)
15,072
20,735
26,201
35,005
43,655
FY09 FY10 FY11 FY12 FY13
30%43%
EBITDA
1,155
2,965
3,6214,150
5,329
FY09 FY10 FY11 FY12 FY13
47%
8.8%
13.9%
Rs. Crs.
10Copyright © 2012 Mahindra & Mahindra Ltd. All rights reserved.
Delivering consistent, long term value
Last 5 years
Note: Adjusted for Bonus & Stock-splitEx Dividend price
Last 11 years
3.5
Last 21 years
6.3
33.5
1.4
2.2
6.9
As at 31st December, 2013
3.58
8.31
54.72
0 10 20 30 40 50 60
Gold
Sensex
M&M
11
Original Investment Cost Vs. CMP
As on 31st, Dec. 2013 Cost Market Value
Listed Companies
Subsidiaries 2,734 16,690
Associates 652 11,718
Total 3,386 28,109
Rs. Crs
12
Unlocking Shareholders Value – Since 2005
Corporate Actions
Bonus Issue – FY 2005 – 1:1
Stock Split – FY 2011 – 1:2
Global Alliance
CIE – Mahindra Deal
13Copyright © 2012 Mahindra & Mahindra Ltd. All rights reserved.
Strong Credit Profile
0.81
0.45
0.320.37
0.3 0.3 0.27
F 2
009
F 2
010
F 2
011
F 2
012
F 2
013
Q3F
13
Q3F
14
2.94
1.12
0.82 0.980.76 0.77 0.74
F 2
009
F 2
010
F 2
011
F 2
012
F 2
013
Q3F
13
Q3F
14
DE RatioM&M + MVML
Gearing MultipleM&M + MVML
Stable Rating AA+ byCRISIL/ICRA/CARE *
* Rating is for M&M Ltd (Standalone Company)
“Healthy financial risk profile supported by considerable financial flexibility arising from market value of investments” - Crisil ‘s Credit Rating Report, April 2013
14
One of the first issuer of GDR of US$ 75 mn in 1993
One of the first issuer of FCCB of US$ 100 mn in 1996
First to issue Rs. 500 Cr. 50 year bullet tenure debentures
XBRL filing – 69 companies within MCA deadline
Financial Milestones
15
Marathon Runner
Prudent Capital Allocation
Support growth with Strategic Acquisition
Maintain strong Credit Rating
Deliver long term shareholder value
16
M&M + MVML- FINANCIAL PERFORMANCE
F – 2014Q3
F – 2013Q3
% Inc/(Dec)
Gross Turnover 11,270 11,522 (2)
Net Sales & Op. Inc. 10,242 10,243 0
PBIT 1,407 1,250 12.5
PAT 1,000 915 9
OPM (%) 15 13.5 0.7
Rs. Crs.
17
M&M + MVML- FINANCIAL PERFORMANCE
F – 2013 F – 2012% Inc/(Dec)
Gross Turnover 43,655 35,005 24.7
Net Sales & Op. Inc. 38,357 31,370 22.3
PBIT 5,081 3,965 28.2
OPM (%) 13.89 13.23 0.66
PAT 3,634 2,997 21.3
Adjusted PAT 3,544 2,740 29
Rs. Crs.
18
M&M + MVML - BALANCE SHEET
F -2013 F -2012
Source of Funds
Shareholder’s Funds 15,055 12,219
Loan Funds * 4,464 4,544
Deferred Tax Liability 756 589
Total 20,275 17,352
* Includes current maturities of Long Term Liabilities
Rs. Crs.
19
M&M + MVML - BALANCE SHEET
F -2013 F -2012
Application of Funds
Fixed Assets 7,747 6,889
Investments 10,894 9,474
Long Term Loans & Advances 2,562 1,734
Cash & Bank Balances 1,823 1,291
Proposed Dividend (891) (869)
Other Assets (Net) (1860) (1167)
Total 20,275 17,352
Rs. Crs.
20
Segment wise Financials
F – 2014 Q3
Inc / (Dec)
F – 2013 Inc / (Dec)
Segment Revenue AS* 6,161 (10%) 26,489 34%
FES 4,099 20% 11,990 3%
Segment Results@AS* 733 (4%) 3,117 45%
FES 721 37% 1,858 1%
Segment ROS % AS* 11.9% 0.7% 11.8% 1%
FES 18% 2% 15.5% 0%
Capital Employed AS* 6,849 9% 6,167 20%
FES 2,888 21% 2,504 7%
Rs. Crs.
@.- After Exceptional Items
* - AS+MVML
21
22
Rs. 836 crs
Rs. 799 crs
5%
Financial Highlights
Growth in Total income
Rs. 18,676 crs
Rs. 17,973 crs
4%
M&M Consolidated – Q2FY 14 vs. Q2FY 13
Rs. 927 crs
Rs. 787 crs
18%
Growth in PAT before MI Growth in PAT after MI
23
Rs. 4,099 crs
Rs. 3,127 crs
31%
Financial Highlights
Growth in Total income
Rs. 74,403 crs
Rs. 63,358 crs
17%
M&M Consolidated – FY 13 vs. FY 12
Rs. 7,449 crs
Rs. 6,245 crs
19%
Growth in EBIDTA Growth in PAT after MI
24
Strong Growth Trajectory
Gross Revenue & Other Income PAT after MI
1,405
2,479
3,080 3,127
4,099
FY09 FY10 FY11 FY12 FY13
Consolidated Accounts
28,99233,790
39,864
63,358
74,403
FY09 FY10 FY11 FY12 FY13
27%
31%
EBITDA
3,163
5,0155,449
6,245
7,449
FY09 FY10 FY11 FY12 FY13
24%
Rs. Crs.
25
M&M Group Consolidated Results
# includes share in profits of Associates
F – 2014Q2
F – 2013Q2
% Inc/(Dec)
Gross Income & Other Income
18,676 17,973 3.9
PAT before MI # 927 787 17.8
PAT after MI 836 799 4.6
Rs. Crs.
26
M&M Group Consolidated Results
# includes share in profits of Associates
F – 2013 F – 2012% Inc/(Dec)
Net Sales & Op. Income 68,735 59,398 15.7
PAT before MI # 4,129 3,060 34.9
PAT after MI 4,099 3,127 31.1
Rs. Crs.
27
Group Companies – Top 4 PAT Earners
Q2F14 – Rs.232 crs
Q2F13 – Rs.193 crs
21%
MMFSL
Q2F14 – Rs.29 crs
Q2F13 – Rs. 27 crs
MHRIL
7%
Q2 F14 – Rs. 717 crs
Q2 F13 – Rs. 456 crs
58%
TML
Q2 F14 – Rs.7 crs
Q2 F13 –Rs. (39) crs
SYMC
118%
28
Automotive
Revenue
10,475
3%
10,165
Q2FY 14
Q2FY 13
Automotive
Results
501
20%
625
Q2FY 14
Q2FY 13
Fin. Services
Revenue
1,293
33%
973
Fin. Service
Results
359
25%
288
IDS
Revenue
199
46%
136
IDS
Results
47
13%
41
Hospitality
Revenue
204
13%
181
Hospitality
Results
35
7%
Q2FY 14
Q2FY 13
Q2FY 14
Q2FY 13
Segment Details
Segment Results is before Exceptional items
Rs. Crs.
29
Farm Equip.
Revenue
3,742
22%
3,059
Q2FY 14
Q2FY 13
Farm Equip.
Results
532
66%
321
Q2FY 14
Q2FY 13
Others
Revenue
790
31%
603
Others
Results
(143)
64%
(88)
Segment Details
Segment Results is before Exceptional items
Rs. Crs.
30
Systech
Revenue
1,290
3%
1,250
Q2FY 14
Q2FY 13
Systech
Results
(12)
18%
(10)
Q2FY 14
Q2FY 13
STP *
Revenue
275
29%
389
STP *
Results
20
22%
25
IT Services
Revenue
65
88%
556
IT Services
Results
7
89%
64
Segment Details
* STP – Steel Trading & processing Segment Results is before Exceptional items
Rs. Crs.
31
Automotive Sector
32
Indian Auto Industry Vehicle Sales
Total 4W Industry CAGR GrowthCAGR 83 – 13 10.6%
CAGR 03 – 13 13.6%
FY13 / FY12….2.0%Source : SIAM
33
M&M Auto Sector sales – Domestic + Export
87117
145 149178
231 230
298
377
483
563
F03 F04 F05 F06 F07 F08 F09 F10 F11 F12 F13
Total AS Sales (‘000)
21%
CAGR
34
*M&M Ltd. is the largest utility vehicle company in IndiaSIAM data
Utility
Vehicle
Player in
India
35
20L5L 12.5L 15L10L
7.4L 10.8L
8L 11.5L
11.0L 14.7L
18.5L 20.6L
6.7L 7.4L
5.9L 7.7L
Presence across all price points
36
6.2L1L 3L 4L2L
3.4L
1.62L 1.69L
1.9L
5L
4.1L 4.5L
5.5L
5.5L 6.2L
3.7L 3.8L
3.7L3.5L
Presence across all price points
37
9MF14 (Apr-Jan) Domestic Market PerformanceGain in PU market share
YTD F14 YTD F14Actual Actual CY PY
UV Total 385,251 -4.4% 158,521 -17.4% 41.1% 47.6%
Cars (Verito) 252,043 36.3% 8,101 -30.1% 3.2% 6.3%
MPV Total 148,432 -15.1% 20,524 -13.2% 13.8% 13.5%
LCV < 2T 128,571 -29.9% 22,305 -28.2% 17.3% 16.9%
2T > LCV < 3.5T 143,251 9.7% 87,308 20.1% 60.9% 55.7%
3W Total 364,669 -9.3% 46,875 -6.4% 12.9% 12.5%
AD (Dom.) Total 1,422,217 -3.8% 343,634 -9.8% 24.2% 25.8%
LCV > 3.5 T Total 53,795 -16.4% 4,359 -33.5% 8.1% 10.2%
MHCV (Goods) 61,499 -29.7% 1,372 -30.8% 2.2% 2.3%
AS (Dom.) Total 1,537,511 -5.7% 349,365 -10.3% 22.7% 23.9%
Non Participating Segments - 0.0% - 0.0% 0.0% 0.0%
MHCV Passenger 28,865 -15.4%
MCV Goods 54,687 -28.8%
Cars (Excl. Super Compact) 1,042,360 -11.4%
AS (Dom.) Total 2,663,423 -8.7% 349,365 -10.3% 13.1% 13.3%
Segment
Industry M&M M&M Mkt. Share
Growth GrowthYTD Q3 F14
38
Exports
3,046
5,534
8,021
12,359
8,501 10,567
14,540
25,628
30,231
24691
21325
F05 F06 F07 F08 F09 F10 F11 F12 F13 9MF13 9M F14
Concern markets :SAARC Countries
39
SYMC
K o r a n d o T u r is m o
R e x t o n W
K o r a n d o C
CY11 Growth
Volume (No.) 120,717 113,001 6.8%
Revenue 3,010.5 2,912.1 3.4%
PBDIT 39.0 (31.3) -
PBT (106.1) (112.4)
H 1 C Y1 4 H 1 C Y 1 3 G r o w t h
Bn KRW
Category 2013 2012 Growth
Q3 YTD Q3 YTD Q3 YTD
Volume (No.) 34,582 104,042 29,039 85,692 19.1% 21.4%
Revenue 838 2,498 699 2,060 19.9% 21.3%
Operating
Profit/Loss
0.7 -13.6 -18.1 -66.7 Turnaround Reduced
Loss
Net Profit/Loss
before Tax1.5 -1.2 -13.7 -66.1 Turnaround Reduced
LossNet Profit/Loss
after Tax1.5 -1.4 -13.7 -66.1 Turnaround Reduced
Loss
BN KRW
CY12
40
Improved Customer SatisfactionSales Satisfaction Index (2013)
8 0 3
8 2 0
8 4 1
2 0 1 1 2 0 1 2 2 0 1 3
R a n k – 8 t h
R a n k – 6 t h
R a n k – 3 r d
M&M Rank
Source: 2013 JD Power Sales Satisfaction Study
41
Improved Customer SatisfactionCustomer Satisfaction Index (2013)
Source: 2013 JD Power Customer Satisfaction Study
7 4 4
7 9 8
8 1 3
2 0 1 1 2 0 1 2 2 0 1 3
R a n k –1 1 t h
R a n k –5 t h
R a n k – 4 t h
M&M Rank
42
Presence in every nook and corner
Sales Network – 1372 Service Network - 1231
Network reaching more than 70% of the districts in India
Reaching 900+ towns/semi-urban and rural areas across the country
43
Financial Performance – AD + MVML
Q3FY2014 %YoY FY2013 %YoY
Segment Revenue Rs. 6,161 -10% Rs. 26,489 34%
Segment Results (after
exceptional items)
Rs.733 -4% Rs. 3,118 45%
Segment capital
employed
Rs. 6,849 9% Rs. 6,167 20%
Rs. Crs.
44
Farm Equipment Sector
45
Domestic Industry Historical Volumes
CAGR : 15.0%
(F73-F82) (F86-F92) (F94-F00) (F03-F11)
No. of tractors
CAGR: 8.2% (F73 – F13)
Source : TMA
22484 31964
41782
5925077636
64703
81629
72106
89631
148219
136376
187675
212732
246404258674
228262214255
160052175475
226105
262621
318427
302241
303783
400203
480377
535210
525970
0
100000
200000
300000
400000
500000
600000
F73
F75
F77
F79
F81
F83
F85
F87
F89
F91
F93
F95
F97
F99
F01
F03
F05
F07
F09
F11
F13
46
M&M Ltd. is the largest tractor company in the world, by volume
*
47
M&M Domestic Market Performance
41,282 44,80760,005
78,048
95,006 90,509
113,269
166,359
202,513
221,730211,596
F03 F04 F05 F06 F07 F08 F09 F10 F11 F12 F13
18%
CAGR
48
Tractor Industry & M&M ...
403617
495089
F13 F14
165699
204758
F13Industry M&M
Continued Domination
FES MS : 41.4%
Period : April – December
49
Tractor Market ShareTotal no. of Tractors
49
40.8 41.4 42.0 41.4 40.2 41.4
22.3 22.0 20.4 23.4 25.0 24.5
13.5 13.3 13.2 11.4 11.7 10.6
8.9 8.7 8.6 8.3 9.7 10.13.1 2.8 2.6 2.8 2.5 2.55.3 4.8 5.1 5.2 5.2 5.06.0 7.0 8.0 7.5 5.7 5.9
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
F09 F10 F11 F12 F13 9MF14
JD
FNH
Others
Sonalika
Escorts
Tafe+Eicher
Mahindra
400,203303,921 480,377 525,970535,210
Source : TMA
495,089
50
Exports
5,385
6,981 7,525
8,533
6,933
8,837
11,812
13,722
12,289
9593
8222
F05 F06 F07 F08 F09 F10 F11 F12 F13 9MF13 9M F14
Degrowth in SAARC Countries
51
Customer Satisfaction Index
F08 F09 F10 F11 F12 F13
84
89
93 9396
108
7679
83
96
106
115
Mahindra & Swaraj : among Top 2 Brands
52
Beyond tractors…
…towards ‘Farm Tech Prosperity’
53
Agri Business
Growth in F&V (61%) and Agri
inputs (38%)
Launch of 'Saboro' brand for
fresh fruits
Exploring new segments of agri value chain (Dairy and Pulses)
25% Growth
Note: Incl. subsidiaries
236294
YTD Q3 F13 YTD Q3 F14
Agri Business Revenue
(Rs. Crs)
Agri Inputs
30%
F&V26%
MIS44%
Agri Business Revenue Share
54
Financial Performance – FES
Q3FY2014 %YoY FY2013 %YoY
Segment Revenue Rs. 4,099 20% Rs. 11,990 3%
Segment Results (after
exceptional items)
Rs.721 37% Rs. 1,858 1%
Segment capital
employed
Rs. 2,888 21% Rs. 2,504 7%
Rs. Crs.
55
FY15 : Tractor Industry Outlook
In FY2015, Industry expected to grow at 8 - 10%
56
Sustainability
Released annual sustainability reports since 2008 to map triple bottom line
performance
Sustainbility reports realeased since 2008 are externally assured & GRI
checked for Application level A+
Ranked 1st in S&P’s ESG India Index-2012
One of the top rankers in the Asian Sustainability Ratings (“ASR”)
Winner in the automobiles category, under the Energy Intensive industries
cluster, in the Green Business Leaders award 2011-12 instituted by
Emergent Ventures India & Financial Express.
CII Sustainability Plus Rating:-
– M & M rated no.1 in transport equipment sector in Gold category and
secured 9th place out of total 100 rated companies in the year 2012.
Carbon Disclosure Leadership Index:-
– M&M Limited was rated with a second highest score of 82 among the top
200 Indian companies in the CDLI ratings for 2012.
57
Commitment to Society
The Mahindra Group
has pledged to dedicate
1% of its Profit after Tax to CSR
initiatives
58
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Copyright © 2012 Mahindra & Mahindra Ltd. All rights reserved.
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