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M A K I N G I N
INDIA F O R T H E W O R L D
INVESTOR PRESENTATION November 2015 | Bharat Forge Ltd. | Pune
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MAKING IN INDIA FOR THE WORLD
20%
26% 38%
16% CV Engine
CV chassis
Non-Auto
Passenger Vehicle
32%
25%
41%
2% India
USA
Europe
Asia-Pac
Bharat Forge Limited - A Global Industrial Conglomerate
2
• Consolidated Revenues: ~ US$ 1.3 bn.
• 10 Manufacturing locations across 4 countries.
• Global Marquee Customer base of more than 35 OEM’s &Tier-
1 companies across automotive & industrial applications.
• Non Auto: 38% of consolidated revenues in FY 2015.
• No single customer exceeds 6% of consolidated revenues.
BHARAT FORGE: PROFILE GLOBAL FORGING CONGLOMERATE
REVENUE BREAK-UP BY GEOGRAPHY – FY 2015 REVENUE BREAK-UP BY SEGMENTS – FY 2015
Geography Capacity (TPA)
403,750
180,000
Total 583,750
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MAKING IN INDIA FOR THE WORLD
Bharat Forge Limited – Key Differentiators
3
Key Differentiators
Technology & Innovation
Relationship
Customers
De-risked Business Model
Full service supply capability
Strong focus on product & process innovation.
Development partners
Leveraging relationship to expand in to new sectors
Strong Marquee Clientele
Biggest customer: 6%
Extensive product portfolio: auto & Industrial
Balanced business: segments & Geography
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MAKING IN INDIA FOR THE WORLD 4
Transformational Shifts around the three Success Levers
ENGINEERING
&
INNOVATION
TECHNO-LOGY
PEOPLE
1. From ‘Muscle Power’ to ‘Brain Power’
2. Creating a ‘Knowledge Workforce’
3. Modernizing Technology & Operations
4. From a ‘Generic Supplier’ to a ‘Partner of Choice’
5. From an ‘Indian Company’ to a ‘Global Company’
6. Diversified Business Model across – i. Geographies ii. Industry Segments
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MAKING IN INDIA FOR THE WORLD
Highlights for H1 FY 2016
5
Volatile market conditions continued in the global commodities and its allied sectors.
Strong cost reduction measures undertaken in last few quarters has helped to improve EBIDTA margins to 31%
Prudent focus on cash flow management and debt reduction
Increased focus on new product development, new customers and faster ramp-up of new businesses
De-risk business model helped partially compensate volatility in Industrial sector with increase in passenger vehicle business
Seeing traction in the aerospace sector and in the “Make in India” program.
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MAKING IN INDIA FOR THE WORLD
Standalone Results – H1 FY 2016
6
Particulars H1 FY16
H1 FY15 Growth %
Shipment Tonnage 106,543 101,683 4.8
Domestic Revenue 9,404 8,772 7.2
Export Revenue 13,049 12,492 4.5%
Total Revenue 22,453 21,264 5.6%
EBITDA 6,952 6,220 11.8%
EBITDA % 31.0% 29.3%
PBT before Ex Gain/ (loss) 5,765 4,810 19.9%
PAT 3,705 3,195 16.0%
(INR Million)
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MAKING IN INDIA FOR THE WORLD
Geographical Breakup - Standalone
7
Particulars (INR Million) H1 FY 2016 H1 FY 2015 % Change
India 9,404 8,771 7.2
Americas 8,564 7,581 13.0
Europe 3,711 4,180 (11.2)
Asia Pacific 774 731 5.8
42%
38%
17% 3% H1 FY16
India
Americas
Europe
Asia-Pac
41%
36%
20%
3% H1 FY15
India
Americas
Europe
Asia-Pac
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MAKING IN INDIA FOR THE WORLD
Segmental Breakup - Standalone
8
Particulars (INR Million) H1 FY 2016 H1 FY 2015 % Change
Commercial Vehicles 10,579 9,020 17.3
Industrial 8,464 9,154 (7.5)
Passenger Vehicle 1,794 1,489 20.5
51% 41%
9% H1 FY16
Commercial Vehicles
Non Auto
Passenger Vehicles
46%
47%
8% H1 FY15
Commercial Vehicles
Non Auto
Passenger Vehicles
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MAKING IN INDIA FOR THE WORLD
Standalone Financial Ratios
9
0.26
0.23
0.2
0.22
0.24
0.26
0.28
Debt Equity Ratio (Net)
Sep-14
Sep-15
21.5% 21.3%
20.0%
20.5%
21.0%
21.5%
22.0%
Return on Capital Employed
Sep-14
Sep-15
21.0%
20.7%
20.0%
20.3%
20.6%
20.9%
21.2%
Return on Net Worth
Sep-14
Sep-15
0.58
0.54
0.52
0.54
0.56
0.58
0.6
Debt Equity Ratio
Sep-14
Sep-15
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MAKING IN INDIA FOR THE WORLD
Industrial Segment - New Sectors; Contributing to “Make in India”
10
INDUSTRIAL BUSINESS
ENERGY
TRANSPORTATION
CONSTRUCTION & MINING
OIL & GAS POWER NUCLEAR, THERMAL, WIND
RAIL MARINE AEROSPACE
CONSTRUCTION METAL & MINING GENERAL ENGINEERING INF
RA
ST
RU
CT
UR
E S
UP
PL
Y B
US
INE
SS
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MAKING IN INDIA FOR THE WORLD
State of Markets / BFL Engagement
11
SECTOR YEAR 2001
YEAR 2004
YEAR 2012
YEAR 2015
YEAR 2017
TRUCK
PASSENGER CAR
CONSTRUCTION
MINING
AGRICULTURE
OIL & GAS
AEROSPACE
DE RISKED BUSINESS MODEL
GEOGRAPHICAL DIVERSIFICATION
SECTOR DIVERSIFICATION
PRODUCT EXPANSION
3,331 5,105 6,555 7,513 9,610 10,024
7,066 12,195
17,347 15,867 18,482
27,207
0
5,000
10,000
15,000
20,000
25,000
30,000
FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15
Revenue Development Exports (INR Million)
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MAKING IN INDIA FOR THE WORLD
FY 2015 Auto Industrial
FY 2011 Auto Industrial
Progression of Industrial Business
12
39% 61%
US$ 175 million
46% 54%
US$ 325 million
Development of product “first time right” using in house technology & capabilities and higher value addition.
Doubled revenues from the Industrial segment. CAGR of 17%
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MAKING IN INDIA FOR THE WORLD
Asset Light Capex: Changing the Approach
13
CAPEX
CUSTOMER
PEOPLE
PRODUCT
PEOPLE
PRODUCT
CUSTOMER
CAPEX
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MAKING IN INDIA FOR THE WORLD
Building a highly skilled & competitive Talent Pipeline
14
BITS PILANI
B Sc. , Manufacturing Engineering; BITS Pilani, India
M Sc., Engineering Business Management; Warwick, U.K.
IIT Bombay
M Tech., Materials, Manufacturing & Model Science; IIT Bombay, India
Ph.D. Program, Focused & Generic Research; Deakin University, Australia
We promote a culture of continuous learning, skill &
knowledge up-gradation across employee groups
UNDER GRADUATE
STUDIES
POST GRADUATE STUDIES
(Management)
POST GRADUATE STUDIES
(Technical)
DOCTORAL PROGRAMS (Technical)
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MAKING IN INDIA FOR THE WORLD
Kalyani Centre for Technology and Innovation
15
Knowledge
Management
Learning &
Development Innovation
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MAKING IN INDIA FOR THE WORLD
State of Markets
16
Particulars INDIA NORTH AMERICA EUROPE
Commercial Vehicles
Passenger Vehicles – High End
Passenger Vehicles – Mass Market
Oil & Gas
Construction
Mining
Aerospace
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THANK YOU