M&M Investor Presentation - PDF Free Download

Global story All around us US on Path of Growth Europe - Mixed External Factors Emerging Markets - Slowing QE tapering impact Developed World as New Emerging World 2

All around us India story Policy Action Investment Slowdown Political Uncertainty GDP Growth Cost of Borrowing Current Account Deficit FY 2014 will be crucial one to watch 3

Double-Edged Sword Global Domestic 4

The Mahindra Group comprises 10 business sectors with a presence in 18 Industries Business Sectors Automotive & Farm Equipment Financial Services Hospitality 2 Wheeler Aftermarket Systech Information Technology Real Estate Defence Systems Mahindra Partners (Steel, Retail, Trade, Logistics, Boats, Energy, Media) 5

Mahindra Group Business Leadership 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 6

Mahindra & Mahindra Ltd. Company Overview M&M is one of India's leading utility vehicle and tractor manufacturers Market leader for H1FY14 in UVs (market share 42.8%) and in Tractors (market share 41.0%) Equity Structure of the company 25.3% Promoter & Promoter Group, 74.7% Public (44.6% Foreign) As at Sept. 30, 2013 Manufacturing plants all across India Auto plants 6, Tractor plants 7, Foundry plant 1 Subsidiaries Total - 130, Operational 62 As at Sept. 30, 2013 7

Shareholding Pattern. 30 Sept., 2013 Top 10 Shareholders with > 1% FI / MF / Banks 1.5% Individuals 13.5% Promoter and Promoter Group 25.3% Life Insurance Corporation of India Golboot Holdings Ltd (Goldman Sachs) Dodge & Cox ICICI Prudential Life Insurance Ltd Insurance Cos. 15.1% First State Investments Capital Group General Insurance Corporation of India Government of Singapore FII / NRI / GDR 44.6% The New India Assurance Company Ltd Vanguard Emerging Markets Stock Index Fund J P Morgan Group 8

Financials 9

Financial Highlights Q2 FY14 Vs Q2 FY13 (M&M + MVML) Growth in Total income Growth in EBIDTA Growth in PAT Rs 9,888 crs -8% Rs 1,254 crs -2% Rs 1,028 crs 5% Rs 10,787 crs Rs 1,280 crs Rs 978 crs 10

Financial Highlights FY13 Vs FY12 (M&M + MVML) Growth in Total income Rs 43,655 crs 25% Rs 35,005 crs Growth in EBIDTA Rs 5,329 crs 28% Rs 4,150 crs Growth in PAT Rs 3,634 crs 21% Rs 2,997 crs Adjusted PAT * Rs 3,544 crs 29% * 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 Rs 2,740 crs 11

Strong Growth Trajectory (M&M + MVML) Rs. Crs. Gross Revenue & Other Income PAT 30% 43,655 43% 3,634 15,072 20,735 26,201 35,005 861 2,068 2,687 2,997 FY09 FY10 FY11 FY12 FY13 FY09 FY10 FY11 FY12 FY13 EBITDA 13.9% 47% 5,329 8.8% 2,965 3,621 4,150 1,155 FY09 FY10 FY11 FY12 FY13 12

Delivering consistent, long term value As at 30 th September Last 21 years Last 11 years Last 5 years M&M 31.54 40.4 3.2 Sensex 7.15 6.5 1.5 Gold 3.74 4.1 1.5 0 10 20 30 40 Note: Adjusted for Bonus & Stock-split Ex Dividend price Copyright 2012 Mahindra & Mahindra Ltd. All rights reserved. 13

Original Investment Cost Vs. CMP As on 30 th, Sept. 2013 Cost Market Value Listed Companies Rs. Crs Subsidiaries 3589 14,656 Associates 649 8,282 Total 4,238 22,938 14

Unlocking Shareholders Value Since 2005 Corporate Actions Bonus Issue FY 2005 1:1 Stock Split FY 2011 1:2 Global Alliance CIE Mahindra Deal 15

F 2009 F 2010 F 2011 F 2012 F 2013 Q2F13 Q2F14 F 2009 F 2010 F 2011 F 2012 F 2013 Q2F13 Q2F14 Strong Credit Profile DE Ratio M&M + MVML Gearing Multiple M&M + MVML Stable Rating AA+ by CRISIL/ICRA/CARE * 0.81 2.94 0.45 0.32 0.37 0.3 0.24 0.26 1.12 0.82 0.98 0.76 0.64 0.71 Healthy financial risk profile supported by considerable financial flexibility arising from market value of investments - Crisil s Credit Rating Report, April 2013 * Rating is for M&M Ltd (Standalone Company) Copyright 2012 Mahindra & Mahindra Ltd. All rights reserved. 16

Financial Milestones 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 17

Marathon Runner Prudent Capital Allocation Support growth with Strategic Acquisition Maintain strong Credit Rating Deliver long term shareholder value 18

M&M + MVML- FINANCIAL PERFORMANCE F 2014 Q2 F 2013 Q2 Rs. Crs. % Inc/ (Dec) Gross Turnover 9,888 10,788 (8) Net Sales & Op. Inc. 8,660 9,253 (6) PBIT 1,393 1,401 (0.6) PAT 1,028 978 5 OPM (%) 14.5 13.8 0.7 19

M&M + MVML- FINANCIAL PERFORMANCE Rs. Crs. 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 PAT 3,634 2,997 21.3 OPM (%) 13.89 13.23 0.66 Adjusted PAT 3,544 2,740 29 20

M&M + MVML - BALANCE SHEET Rs. Crs. 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 21

M&M + MVML - BALANCE SHEET Rs. Crs. 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 22

Segment wise Financials F 2014 Q2 Inc / (Dec) Rs. Crs. F 2013 Inc / (Dec) Segment Revenue AS * 5,555 (16%) 26,489 34% FES 3,148 19% 11,990 3% Segment Results @ AS * 624 (23%) 3,117 45% FES 534 36% 1,858 1% Segment ROS % AS * 11.2% (0.9%) 11.8% 1% FES 17% 2% 15.5% 0% Capital Employed AS * 6,881 16% 6,167 20% FES 3,320 18% 2,504 7% * - AS+MVML @.- After Exceptional Items 23

Financial Highlights M&M Consolidated Q2FY 14 vs. Q2FY 13 Growth in Total income Growth in PAT before MI Rs. 927 crs Growth in PAT after MI Rs. 18,676 crs 4% Rs. 17,973 crs 18% Rs. 787 crs Rs. 836 crs 5% Rs. 799 crs 25

Financial Highlights M&M Consolidated FY 13 vs. FY 12 Growth in Total income Growth in EBIDTA Growth in PAT after MI Rs. 4,099 crs Rs. 74,403 crs Rs. 7,449 crs 31% 17% 19% Rs. 63,358 crs Rs. 6,245 crs Rs. 3,127 crs 26

Strong Growth Trajectory Gross Revenue & Other Income Consolidated Accounts PAT after MI Rs. Crs. 27% 74,403 31% 4,099 63,358 3,080 3,127 28,992 33,790 39,864 1,405 2,479 FY09 FY10 FY11 FY12 FY13 FY09 FY10 FY11 FY12 FY13 EBITDA 24% 7,449 5,015 5,449 6,245 3,163 FY09 FY10 FY11 FY12 FY13 27

M&M Group Consolidated Results Rs. Crs. Gross Income & Other Income F 2014 Q2 F 2013 Q2 % Inc/ (Dec) 18,676 17,973 3.9 PAT before MI # 927 787 17.8 PAT after MI 836 799 4.6 # includes share in profits of Associates 28

M&M Group Consolidated Results Rs. Crs. 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 # includes share in profits of Associates 29

Group Companies Top 4 PAT Earners MMFSL SYMC TML MHRIL Q2F14 Rs.232 crs Q2 F14 Rs.7 crs Q2 F14 Rs. 717 crs Q2F14 Rs.29 crs Q2F13 Rs.193 crs Q2 F13 Rs. (39) crs Q2 F13 Rs. 456 crs Q2F13 Rs. 27 crs 21% 118% 58% 7% 30

Segment Details Rs. Crs. Automotive Fin. Services IDS Hospitality Revenue Revenue Revenue Revenue Q2FY 14 10,475 1,293 199 204 Q2FY 14 3% 33% 46% 13% Q2FY 13 10,165 973 136 181 Q2FY 13 Automotive Fin. Service IDS Hospitality Results Results Results Results Q2FY 14 501 359 47 35 Q2FY 14 20% 25% 13% 7% Q2FY 13 625 288 41 Q2FY 13 Segment Results is before Exceptional items 31

Segment Details Q2FY 14 Q2FY 13 Farm Equip. Revenue 3,742 22% 3,059 Rs. Crs. Others Revenue 790 31% 603 Q2FY 14 Q2FY 13 Farm Equip. Results 532 66% 321 Others Results (143) 64% (88) Segment Results is before Exceptional items 32

Segment Details Systech STP * Revenue Revenue Rs. Crs. IT Services Revenue Q2FY 14 1,290 275 65 3% 29% 88% Q2FY 13 1,250 389 556 Systech STP * IT Services Results Results Results Q2FY 14 (12) 20 7 18% 22% 89% Q2FY 13 (10) 25 64 * STP Steel Trading & processing Segment Results is before Exceptional items 33

Automotive Sector 34

Indian Auto Industry Vehicle Sales Total 4W Industry CAGR Growth CAGR 83 13 10.6% CAGR 03 13 13.6% Source : SIAM FY13 / FY12.2.0% 35

M&M Auto Sector sales Domestic + Export Total AS Sales ( 000) 21% 377 483 563 CAGR 117 87 145 149 178 231 230 298 F03 F04 F05 F06 F07 F08 F09 F10 F11 F12 F13 36

Utility Vehicle Player in India *M&M Ltd. is the largest utility vehicle company in India SIAM data 37

Presence across all price points 1 1.0 L 1 4.7 L 1 8.5 L 2 0.6 L 8L 1 1.5 L 7.4 L 1 0.8 L 5.9 L 7.7 L 6.7 L 7.4 L 5L 10 1 2.5 L 15 L L 20 L 38

Presence across all price points 5.5 L 6.2 L 3.7 L 3.8 L 5.5 L 3.5 L 3.7 L 4.1 L 4.5 L 3.4 L 1.9 L 1.6 2 L 1.6 9 L 1L 2L 3L 4L 5L 6.2 L 39

H1F14 Domestic Market Performance Period : April September Segment UV Total Cars (Verito) MPV Total LCV < 2T 2T > LCV < 3.5T 3W Total AD (Dom.) Total LCV > 3.5 T Total MHCV (Goods) AS (Dom.) Total Non Participating Segments MHCV Passenger MCV Goods Cars (Excl. Super Compact) AS (Dom.) Total Industry H1 F14 Actual 243,640 Growth -4.8% 164,879 33.2% 101,834-9.8% 87,016-26.6% 94,447 17.1% 239,539-4.4% 931,355-1.2% 39,688-12.6% 44,375-30.9% - 0.0% 1,015,418-3.5% - 0.0% - 0.0% 22,791-11.1% 38,331-25.2% 690,439-10.7% 1,766,979-7.1% M&M AS H1 F14 Growth Actual 104,357-14.0% 6,134-21.2% 14,773-4.2% 15,223-28.0% 55,194 19.4% 28,409-8.4% 224,090-7.8% 3,429-27.8% 917-33.3% - 0.0% 228,436-8.3% - 0.0% - 0.0% - 0.0% - 0.0% - 0.0% 228,436-8.3% M&M Mkt. Share H1 F14 H1 F13 Actual Actual 42.8% 47.4% 3.7% 6.3% 14.5% 13.7% 17.5% 17.8% 58.4% 57.3% 11.9% 12.4% 24.1% 25.8% 8.6% 10.5% 2.1% 2.1% 0.0% 0.0% 22.5% 23.7% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 12.9% 13.1% 40

M&M International Market Performance High growth in FY13 H1, Slowdown from FY13 H2 onwards H1 F13 H2 F13 Apr-Sept 12,956 20,313 18,190 15,601 16,220 14,226 40% 23% 12% H1 F12 H1 F13 H2 F12 H2 F13 F13 F14 F13 Growth Markets F13 Concern Markets South Africa 57% Chile 48% Nepal 47% Sri Lanka Bangladesh Bhutan 18% Mkt. drop + duty impact 63% Mkt. drop 77% Regulation for import payment 41

SYMC Bn KRW CY 12 CY1 1 Growth Volume (No.) 1 2 0,7 1 7 1 1 3,0 0 1 6.8 % Revenue 3,0 1 0.5 2,9 1 2.1 3.4 % PBDIT 3 9.0 (3 1.3 ) - PBT (1 0 6.1 ) (1 1 2.4 ) Rexton W BN KRW Category 2013 2012 Growth H1 CY 14 H1 CY1 3 Growth Q3 YTD Q3 YTD Q3 YTD Volume (No.) 3 4,5 8 2 1 0 4,0 4 2 2 9,0 3 9 8 5,6 9 2 1 9.1 % 2 1.4 % Revenue 838 2,4 9 8 699 2,0 6 0 1 9.9 % 2 1.3 % Operating Profit/ Loss Net Profit/ Loss before Tax Net Profit/ Loss after Tax 0.7-1 3.6-1 8.1-6 6.7 Turnaround Reduced Loss 1.5-1.2-1 3.7-6 6.1 Turnaround Reduced Loss 1.5-1.4-1 3.7-6 6.1 Turnaround Reduced Loss Korando C Korando Turismo 42

Improved Customer Satisfaction Sales Satisfaction Index (2013) 841 803 Rank 8 th 820 Rank 6 th Rank 3 rd 2011 2012 2013 M&M Rank Source: 2013 JD Power Sales Satisfaction Study 43

Improved Customer Satisfaction Customer Satisfaction Index (2013) 798 Rank 5 th 813 Rank 4 th 744 Rank 11 th 2011 2012 2013 M&M Rank Source: 2013 JD Power Customer Satisfaction Study 44

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 45

Financial Performance AD + MVML Rs. Crs. Q2FY2014 %YoY FY2013 %YoY Segment Revenue Rs. 5,555-16% Rs. 26,489 34% Segment Results (after exceptional items) Segment capital employed Rs.624-23% Rs. 3,118 45% Rs. 6,881 16% Rs. 6,167 20% 46

Farm Equipment Sector 47

F73 F75 F77 F79 F81 F83 F85 F87 F89 F91 F93 F95 F97 F99 F01 F03 F05 F07 F09 F11 F13 Domestic Industry Historical Volumes No. of tractors CAGR : 15.0% 600000 (F73-F82) (F86-F92) (F94-F00) (F03-F11) CAGR: 8.2% (F73 F13) 535210 500000 480377 525970 400000 400203 300000 246404 258674 318427 262621 302241 303783 200000 148219 136376 212732 187675 228262 214255 226105 175475 160052 100000 59250 77636 81629 89631 0 22484 31964 Source : TMA 41782 64703 72106 48

* M&M Ltd. is the largest tractor company in the world, by volume 49

M&M Domestic Market Performance 18% 166,359 202,513 221,730 211,596 CAGR 78,048 60,005 41,282 44,807 95,006 90,509 113,269 F03 F04 F05 F06 F07 F08 F09 F10 F11 F12 F13 50

Tractor Industry & M&M : Pick Up in Momentum.. Period : April September 313523 253055 103358 128626 F13 Industry F13 F14 Continued Domination M&M FES MS : 41.0% 51

Tractor Market Share Total no. of Tractors 52 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 303,921 400,203 480,377 535,210 525,970 215,211 6.0 7.0 8.0 7.5 5.7 5.6 5.3 4.8 3.1 5.1 5.2 5.2 4.9 2.8 2.6 2.8 2.5 2.5 8.9 8.7 8.6 8.3 9.7 10.1 13.5 13.3 13.2 11.4 11.7 10.8 22.3 22.0 20.4 23.4 25.0 25.1 40.8 41.4 42.0 41.4 40.2 41.0 JD FNH Others Sonalika Escorts Tafe+Eicher Mahindra 0% Source : TMA F09 F10 F11 F12 F13 H1F14 52

Exports 11,812 13,722 12,289 5,385 6,981 7,525 8,533 6,933 8,837 6063 5215 F05 F06 F07 F08 F09 F10 F11 F12 F13 H1F13 H1 F14 Degrowth in SAARC Countries 53

Customer Satisfaction Index Mahindra & Swaraj : among Top 2 Brands 115 106 108 89 93 93 96 96 84 76 79 83 F08 F09 F10 F11 F12 F13 54

Beyond tractors towards Farm Tech Prosperity 55

Agri Business 33% Growth Growth in F&V (49%) and Agri inputs (47%) Retained No. 1 position in Grapes Expanding current portfolio and exploring new segments of agri value chain Agri Business Revenue (Rs. crs) 156.2 208.5 H1 F1 3 H1 F1 4 Agri Business Revenue Share Agri Inputs 33% 33% MIS 41% F&V 26% 56

Financial Performance FES Rs. Crs. Q2FY2014 %YoY FY2013 %YoY Segment Revenue Rs. 3,148 19% Rs. 11,990 3% Segment Results (after exceptional items) Segment capital employed Rs.534 36% Rs. 1,858 1% Rs. 3,320 18% Rs. 2,504 7% 57

F14 : Industry Outlook Industry expected to grow at 15-17% 58

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 1 st 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 9 th 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. 59

Commitment to Society The Mahindra Group has pledged to dedicate 1% of its Profit after Tax to CSR initiatives 60

Thank you Visit us at www.mahindra.com Disclaimer Mahindra & Mahindra herein referred to as M&M, and its subsidiary companies provide a wide array of presentations and reports, with the contributions of various professionals. These presentations and reports are for informational purposes and private circulation only and do not constitute an offer to buy or sell any securities mentioned therein. They do not purport to be a complete description of the markets conditions or developments referred to in the material. While utmost care has been taken in preparing the above, we claim no responsibility for their accuracy. We shall not be liable for any direct or indirect losses arising from the use thereof and the viewers are requested to use the information contained herein at their own risk. These presentations and reports should not be reproduced, re-circulated, published in any media, website or otherwise, in any form or manner, in part or as a whole, without the express consent in writing of M&M or its subsidiaries. Any unauthorized use, disclosure or public dissemination of information contained herein is prohibited. Unless specifically noted, M&M or any of its subsidiary companies is not responsible for the content of these presentations and/or the opinions of the presenters. Individual situations and local practices and standards may vary, so viewers and others utilizing information contained within a presentation are free to adopt differing standards and approaches as they see fit. You may not repackage or sell the presentation. Products and names mentioned in materials or presentations are the property of their respective owners and the mention of them does not constitute an endorsement by M&M or its subsidiary companies. Information contained in a presentation hosted or promoted by M&M is provided as is without warranty of any kind, either expressed or implied, including any warranty of merchantability or fitness for a particular purpose. M&M or its subsidiary companies assume no liability or responsibility for the contents of a presentation or the opinions expressed by the presenters. All expressions of opinion are subject to change without notice. Copyright 2012 Mahindra & Mahindra Ltd. All rights reserved. 61