oem- financial analysis fy 19 - acma
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OEM- Financial Analysis FY 19
Strictly private and confidential
March 2020
PwC
March 2020Strictly private and confidential
Draft
List of Companies and Ratios 3
1 List of companies 4
2 Ratios used 5
Macro Economic Climate in India 6
OEM Financial analysis 10
1 Ashok Leyland 11
2 Atul Auto 15
3 Bajaj Auto 19
4 Escorts 23
5 Force Motors 27
6 Hero Motocorp 31
7 Mahindra and Mahindra 35
8 Maruti Suzuki 39
9 SML ISUZU 43
10 Tata Motors 47
11 TVS 51
Contents
2
OEM- Financial Analysis
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List of Companies and Ratios
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OEM- Financial Analysis
List of Companies and Ratios 3
1 List of companies 4
2 Ratios used 5
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List of companies included in the analysis
4
OEM- Financial Analysis
1 List of companies
Ashok Leyland
Force Motors
Escorts
Hero MotoCorp
Mahindra & Mahindra
SML ISUZU
Tata Motors
Maruti Suzuki
TVS Motor Co.
Bajaj Auto
Atul Auto
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Ratios used
5
OEM- Financial Analysis
2 Ratios used
EBITDA margin (EBITDA-other income)/Net Sales
EBIT margin (EBIT-other income)/Net Sales
PBT margin (PBT-other income)/Net Sales
PAT margin (PAT-other income)/Net Sales
Inventory Turnover Net sales/Inventory
FATO Annual Net sales/Annual net fixed assets
Average days payable outstanding
Payables/(COGS/Days)
Working capital cycle days
Working capital/(Net Sales/Days)
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Macro Economic Climate in India
6
OEM- Financial Analysis
OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
India-key economic indicators A steady growth is expected in the foreseeable future
➢ India economic growth picked up pace again in FY 18, having recovered from the effects of the implementation of demonetisation and the Goods and Services Tax.
➢ Growth is expected to subsequently stabilize, supported by a sustained recovery in private investment and private consumption.
➢ The industrial production index growth increased due to low base effect and due to good performance of infrastructure and construction goods sector and consumer durables production.
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
0
35
70
105
140
175
210
20
16
20
17
20
18
20
19
20
20
20
21
20
22
20
23
20
24
20
25
India: Industrial Production Index2013 – 2020F (points)
YoY Growth Rate (R-Axis)
OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
16 17 20F18 19 21F 22F 23F 24F
+9.2%
India: GDP | Real USD Bn2016-2024F
Source: IMF Source: IHS
India-key economic indicators The private demand indicators also show a promising scenario for batter growth prospects
5%
6%
7%
8%
9%
10%
2015 2017 2019 2021 2023
India: Unemployment Rate2015 – 2023 (percentage)
0%
1%
1%
2%
2%
800
850
900
950
1,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
India: Working Age Population2016 – 2025 (millions)
YoY Growth Rate (R-Axis)
0%
3%
5%
8%
10%
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
India: Real Private Consumption2013 – 2024F (Real, US$ (billions))
YoY Growth Rate (R-Axis)
0%
5%
10%
15%
20%
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
2014 2016 2018
India: GNDI per capita2014 – 2019 (Real, Rs Cr)
YoY Growth Rate (R-Axis)
OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
Source: IHSSource: IHS
Source: IHSSource: RBI
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OEM Financial analysis
10
OEM- Financial Analysis
OEM Financial analysis 10
1 Ashok Leyland 11
2 Atul Auto 15
3 Bajaj Auto 19
4 Escorts 23
5 Force Motors 27
6 Hero Motocorp 31
7 Mahindra and Mahindra 35
8 Maruti Suzuki 39
9 SML ISUZU 43
10 Tata Motors 47
11 TVS 51
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Ashok Leyland
11
OEM- Financial Analysis
1 Ashok Leyland OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
Ashok Leyland
Manufacturing Sites in India
Ennore-TN Hosur-TN
Bhandara-MH Alwar-RJ
Pantanagar-UK160 K
160 K 160 K
95% 103% 128%
120 K
130 K
140 K
150 K
160 K
170 K
180 K
190 K
200 K
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
FY 16-17 FY 17-18 FY 18-19
Installed Capacity Utilisation %
Prod. 151 K 165 K 205 K
Capac. 150 K 160 K 160 K
**
** This map is not to scale. It is an indicative outline intended for general reference use only.
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Ashok Leyland
Trends in aggregates, profitability and costs
13
OEM- Financial Analysis
1 Ashok Leyland
20172015 2016 20192018
19.4
13.9
20.5
26.829.4
+39% +6%
+21%
+31%+10%
20192015 2016 2017 2018
1.31.6
2.0
3.1 3.2+25%+28%
+26%
+56% +2%
Net Sales
EBITDA
Aggregates (INR ‘000 Cr)
2015 2016 2017 2018 2019
4.7%
7.6%
5.5%
-1.1%
8.4%
2.4%3.8%
10.0% 10.4%
6.4%
EBITDA Margin
PAT Margin
2015 2016 2017 2018 2019
8.5%
72.0%
7.2%
0.6%
71.9%70.3%
0.6%
7.3%
0.8%Power & Fuel Cost 0.8%
64.1%
7.0%
0.9%
73.5%
7.3%
Material Cost
Employee Cost
2015 2016 2017 2018 2019
2.8%
3.0%1.3%
2.2%2.5%
0.6%0.8%
2.5%
0.2%
2.1%Interest
Depreciation
Profitability
Direct costs
Other costs
Margins (% of net sales)
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Ashok Leyland
Trends in efficiency
14
OEM- Financial Analysis
1 Ashok Leyland
1.6
3.7
3.53.9 3.9
2015 2016 2017 2018 2019
Fixed Asset Turnover Ratio
➢ Ashok Leyland had the saw a strong improvement in average days payable outstanding.
➢ Ashok Leyland had an 18% market share in the Commercial Vehicles space.
1
17-4 -3
2015 2016 2017 2018 2019
-44
Days Working Capital (Days)
2015 2016 2017 2018 2019
37
32
46
26
33
Inventory Turnover days
2015 2016 2017 2018 2019
7274
5055
61
Average days payable outstanding
Higher = Better
Lower = Better Lower = Better
Lower = Better
In FY 19
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Atul Auto
15
OEM- Financial Analysis
2 Atul Auto OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
Atul Auto
Manufacturing Sites in India
Rajkot, GJ60 K 60 K 60 K
65%
71%
84%
0 K
10 K
20 K
30 K
40 K
50 K
60 K
70 K
0%
20%
40%
60%
80%
100%
120%
140%
FY 16-17 FY 17-18 FY 18-19
Installed Capacity Utilisation %
Prod. 39 K 43 K 50 K
Capac. 60 K 60 K 60 K
**
** This map is not to scale. It is an indicative outline intended for general reference use only.
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Atul Auto
Trends in aggregates, profitability and costs
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OEM- Financial Analysis
2 Atul Auto
2018
0.56
2015 2016 2017 2019
0.49 0.480.53
0.67
+8%-10%
+8%
+17%+20%
20162015 2017 2018 2019
0.10.10.1
0.1
0.1
+19%-20%
+8%
+21%+18%
Net Sales
EBITDA
Aggregates (INR ‘000 Cr)
2015 2016 2017 2018 2019
11.7%
7.3%6.7%
8.7%
12.5%
14.4%13.0%
7.8%
12.2%
6.9%
EBITDA Margin
PAT Margin
2015 2016 2017 2018 2019
6.1%
72.9%
0.4%
74.5%73.1%
0.6%
75.8%
0.6%
7.7%6.6%
0.6%
72.3%
6.7%
0.6%
6.7%
Material Cost
Employee Cost
Power & Fuel Cost
2015 2016 2017 2018 20190.1%
1.1%
0.1%
1.0%
0.1%
0.9%
0.1%
1.1%
0.1%
0.8%
Interest
Depreciation
Profitability
Direct costs
Other costs
Margins (% of net sales)
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Atul Auto
Trends in efficiency
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OEM- Financial Analysis
2 Atul Auto
4.2 4.23.6
4.04.4
2015 2016 2017 2018 2019
Fixed Asset Turnover Ratio
2746
56
46
49
2015 2016 2017 2018 2019
Days Working Capital (Days)
2015 2016 2017 2018 2019
3534
20
25
31
Inventory Turnover days
2015 2016 2017 2018 2019
20
26
31
37 36
Average days payable outstanding
Higher = Better
Lower = Better Lower = Better
Lower = Better
➢ Atul Auto is the only OEM in the list of 11 studied as part of this report with majority operations in the 3-wheeler segment.
➢ Atul Auto has the lowest EBITDA of the 11 OEMs.
In FY 19
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Bajaj Auto
19
OEM- Financial Analysis
3 Bajaj Auto OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
Bajaj Auto
Manufacturing Sites in India
Aurangabad-MH Pantnagar-UK
Chakan-MH6000 K
6060 K
6240 K
65%
60%
80%
5000 K
5200 K
5400 K
5600 K
5800 K
6000 K
6200 K
0%
20%
40%
60%
80%
100%
FY 16-17 FY 17-18 FY 18-19
Installed Capacity Utilisation %
Prod. 446 K 640 K 777 K
Capac. 600 K 660 K 840 K
Prod. 3209 K 3391 K 4233 K
Capac. 5400 K 5400 K 5400 K**
** This map is not to scale. It is an indicative outline intended for general reference use only.
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Bajaj Auto
Trends in aggregates, profitability and costs
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OEM- Financial Analysis
3 Bajaj Auto
25.2
20182015 2016 2017 2019
21.6
30.2
22.6 21.8
+5%-4%
+9%
+16%+20%
5.9
2018
5.6
2015 20172016 2019
4.4
6.17.0
+34%-4%
+12%
+8%+14%
Net Sales
EBITDA
Aggregates (INR ‘000 Cr)
2015 2016 2017 2018 2019
20.3%
10.3%
17.5%19.1%
21.2%
16.5%
12.0%12.6%
11.0%
8.9%
EBITDA Margin
PAT Margin
2015 2016 2017 2018 2019
4.0%4.6%
69.0%
0.5%
3.9%
0.5%
66.4%67.4%
0.4%0.4%
4.2%
69.0%
72.3%
4.2%
Power & Fuel Cost 0.4%
Material Cost
Employee Cost
2015 2016 2017 2018 2019
0.0%
1.4%
0.0%
1.2%1.2%
0.0% 0.0%
1.4%
0.0%
0.9%
Interest
Depreciation
Profitability
Direct costs
Other costs
Margins (% of net sales)
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Bajaj Auto
Trends in efficiency
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OEM- Financial Analysis
3 Bajaj Auto
2015 2016 2017 2018 2019
4.7
5.35.1
5.6
7.0
Fixed Asset Turnover Ratio
2
-9
7
2015 2016 2017 2018 2019
-13
10
Days Working Capital (Days)
2015 2016 2017 2018 2019
11
13
12
11
11
Inventory Turnover days
2015 2016 2017 2018 2019
31
27
47
37
45
Average days payable outstanding
Higher = Better
Lower = Better Lower = Better
Lower = Better
➢ Net sales at Rs 30,000 Cr is the company’s highest ever annual sales recorded.
➢ Among all 11 OEMs studied as part of this report, Bajaj continues to enjoy the highest profit margins (EBIT %, EBITDA %, PAT %).
➢ Days working capital and fixed asset turnover ratio both saw substantial increases in FY 19
In FY 19
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Escorts
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OEM- Financial Analysis
4 Escorts OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
Escorts
Manufacturing Sites in India
Faridabad-HR Rudrapur-UK
Prod. 65 K 81 K 101 K
Capac. 99 K 99 K 100 K
**
** This map is not to scale. It is an indicative outline intended for general reference use only.
99 K 99 K 100 K
66%
82%
101%
0 K
10 K
20 K
30 K
40 K
50 K
60 K
70 K
80 K
90 K
100 K
0%
20%
40%
60%
80%
100%
120%
140%
FY 16-17 FY 17-18 FY 18-19
Installed Capacity Utilisation %
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Escorts
Trends in aggregates, profitability and costs
25
OEM- Financial Analysis
4 Escorts
20172015 2016
5.0
2018 2019
3.44.0 4.1
6.2-16%+22%
+12%
+22%
+24%
0.6
0.2
201720162015 2018 2019
0.8
0.20.3
+6%+62%
+44%
+85%
+35%
Net Sales
EBITDA
Aggregates (INR ‘000 Cr)
2015 2016 2017 2018 2019
1.0%
-1.9%EBITDA Margin
4.4%
0.8%2.5%
6.6% 5.7%
11.0% 11.8%
6.3%
PAT Margin
2015 2016 2017 2018 2019
11.6%
Material Cost
9.8%
1.1%
69.4%
1.1%
70.1%
0.7%
69.4%
11.9%
0.9%
67.8%
Power & Fuel Cost
8.8%
71.7%
7.6%
0.7%
Employee Cost
2015 2016 2017 2018 2019
0.3%
1.5%
1.4%
1.7% 1.5%1.5%
1.7%0.8%
0.6%
1.4%
Interest
Depreciation
Profitability
Direct costs
Other costs
Margins (% of net sales)
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Escorts
Trends in efficiency
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OEM- Financial Analysis
4 Escorts
1.71.4
1.72.0
2.4
2015 2016 2017 2018 2019
Fixed Asset Turnover Ratio
162 1
42
2015 2016 2017 2018 2019
30
Days Working Capital (Days)
37
37 2934
40
2015 2016 2017 2018 2019
Inventory Turnover days
2015 2016 2017 2018 2019
65
52
43
50 51
Average days payable outstanding
Higher = Better
Lower = Better Lower = Better
Lower = Better
➢ Escorts is the only OEM, in this list of 11, to have significant portion of its revenue contributed to by the tractors segment alone.
➢ It experienced the second largest inventory turnover ratio of the companies studied, second only to SML ISUZU
In FY 19
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Force Motors
27
OEM- Financial Analysis
5 Force Motors OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
Force Motors
Manufacturing Sites in India
Pune-MH Pithampura-MP
Urse-MH Chennai-TN
Chakan-MH
99 K 99 K 99 K
30% 31%27%
95 K
96 K
96 K
97 K
97 K
98 K
98 K
99 K
99 K
100 K
100 K
0%
20%
40%
60%
80%
100%
FY 16-17 FY 17-18 FY 18-19
Installed Capacity Utilisation %
Prod. 27 K 27 K 23 K
Capac. 75 K 75 K 75 K
Prod. 3.6 K 3.2 K 3.8 K
Capac. 24 K 24 K 24 K**
** This map is not to scale. It is an indicative outline intended for general reference use only.
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Force Motors
Trends in aggregates, profitability and costs
29
OEM- Financial Analysis
5 Force Motors
2015 20192016 2017 2018
2.43.0 3.1
3.4 3.7
+28% +1%
+11%
+12% +7%
0.40.4
20162015 2017 2018 2019
0.30.2
0.3
+62% +2%
+14%
-5% +7%
Net Sales
EBITDA
Aggregates (INR ‘000 Cr)
2015 2016 2017 2018 2019
7.8%8.7%
6.2%
9.1%
1.5%3.5%
2.3%PAT Margin
3.1%
7.6%
1.8%
EBITDA Margin
2015 2016 2017 2018 2019
69.4%
1.5%
74.0%
69.7%
11.7%
1.6%
10.1%11.4%
1.5%
77.1%76.2%
11.3%
1.4%
11.4%
1.3%
Material Cost
Employee Cost
Power & Fuel Cost
2015 2016 2017 2018 2019
0.2%0.3%
3.4% 3.7% 3.8%
0.2%
3.0%
0.2% 0.4%
4.1%
Interest
Depreciation
Profitability
Direct costs
Other costs
Margins (% of net sales)
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Force Motors
Trends in efficiency
30
OEM- Financial Analysis
5 Force Motors
1.51.6
1.5 1.61.4
2015 2016 2017 2018 2019
Fixed Asset Turnover Ratio
62
81
47 51
2015 2016 2017 2018 2019
63
Days Working Capital (Days)
2015 2016 2017 2018 2019
43
49
40
38 38
Inventory Turnover days
2015 2016 2017 2018 2019
30
4345
37
44
Average days payable outstanding
Higher = Better
Lower = Better Lower = Better
Lower = Better
➢ The OEM had the lowest Fixed Asset Turnover ratio of all the studied companies.
➢ Force Motors had the second highest employee cost of all the studied companies.
In FY 19
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Hero Motocorp
31
OEM- Financial Analysis
6 Hero Motocorp OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
Hero MotoCorp
Manufacturing Sites in India
Haridwar-UK Dharuhera-HR
Gurgaon-HR Neemrana-RJ
Vadodara-GJ Cauca-Colombia
8130 K
9200 K 9200 K
82% 83%80%
7000 K
7500 K
8000 K
8500 K
9000 K
9500 K
0%
20%
40%
60%
80%
100%
FY 16-17 FY 17-18 FY 18-19
Installed Capacity Utilisation %
Prod. 6613 K 6646 K 7831 K
Capac. 8130 K 9200 K 9200 K
**
Cauca-
Colombia
** This map is not to scale. It is an indicative outline intended for general reference use only.
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Hero Motocorp
Trends in aggregates, profitability and costs
33
OEM- Financial Analysis
6 Hero Motocorp
20192015 2016 2017 2018
27.6 28.4 28.532.2 33.7
+3%0%
+5%
+13% +4%
2015
4.9
2016 2019
3.9
2017 2018
5.85.2
5.6
+26% +6%
+10%
+13%-3%
Net Sales
EBITDA
Aggregates (INR ‘000 Cr)
2015 2016 2017 2018 2019
9.8%
16.4%
12.3%
16.3%
6.9%
9.6%
15.7%
10.0%
14.7%
8.0%
EBITDA Margin
PAT Margin
2015 2016 2017 2018 2019
0.6%
66.6%
71.7%
4.8%4.3%
67.9%
4.6% 4.9%
0.4% 0.4%
67.8%
0.4%
69.4%
5.1%
0.5%
Material Cost
Employee Cost
Power & Fuel Cost
2015 2016 2017 2018 2019
0.0%
2.0%
0.0%
1.5% 1.7%
0.0% 0.0%
1.7%
0.0%
1.8%
Interest
Depreciation
Profitability
Direct costs
Other costs
Margins (% of net sales)
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Hero Motocorp
Trends in efficiency
34
OEM- Financial Analysis
6 Hero Motocorp
3.43.1
2.7 2.9 2.9
2015 2016 2017 2018 2019
Fixed Asset Turnover Ratio
-10 -15
9
2015 2016 2017 2018 2019
-12-12
Days Working Capital (Days)
2015 2016 2017 2018 2019
10
12
13
10
11
Inventory Turnover days
2015 2016 2017 2018 2019
39 40
50
45
42
Average days payable outstanding
Higher = Better
Lower = Better Lower = Better
Lower = Better
➢ Hero Motocorp had the second highest profit margins bettered only by Bajaj across EBITDA %, EBIT % and PAT %.
➢ Among these OEMs, Hero Motocorp also demonstrated the best average inventory turnover days at 13 for FY 19.
➢ It had the lowest rate of raw material cost as a % of net sales.
In FY 19
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Mahindra and Mahindra
35
OEM- Financial Analysis
7 Mahindra and Mahindra OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
Mahindra & Mahindra
Manufacturing Sites in India
Haridwar-UK Kandivali-MH
Zaheerabad-AP Nashik-MH
Chakan-MH Pithampura-MP
Prod. 498 K 549 K 618 K
Capac. 968 K 920 K 940 K
Prod. 274 K 318 K 338 K
Capac. 376 K 376 K 376 K
Prod. 57 K 33 K 7 K
Capac. 750 K 750 K 750 K **
** This map is not to scale. It is an indicative outline intended for general reference use only.
2094 K
1670 K
2066 K
40%
54%47%
1200 K
1400 K
1600 K
1800 K
2000 K
2200 K
2400 K
0%
20%
40%
60%
80%
100%
FY 16-17 FY 17-18 FY 18-19
Installed Capacity Utilisation %
Capacity includes production capacity for Construction Equipment.
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Mahindra and Mahindra
Trends in aggregates, profitability and costs
37
OEM- Financial Analysis
7 Mahindra and Mahindra
201820172015 2016 2019
53.6
38.4 40.9 44.148.7
+6% +8%
+9%
+11%+10%
20172016 2019
7.7
2015 2018
5.4 5.56.4
8.3+3%
+16%
+12%
+20%+8%
Net Sales
EBITDA
Aggregates (INR ‘000 Cr)
2015 2016 2017 2018 2019
9.7%10.9%
5.6%
12.8%
3.5%4.7%
11.3%
5.6% 5.9%
11.2%
EBITDA Margin
PAT Margin
2015 2016 2017 2018 2019
6.2%
0.6%
71.9%
5.7%
72.8%
6.0%
0.6%
72.7%
0.5%
69.7%
5.8%
0.5%
73.1%
5.6%
0.5%
Material Cost
Employee Cost
Power & Fuel Cost
2015 2016 2017 2018 2019
2.54%3.46% 3.04%
0.46%0.56%
2.61%
0.36% 0.23% 0.21%
3.47%
Interest
Depreciation
Profitability
Direct costs
Other costs
Margins (% of net sales)
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Mahindra and Mahindra
Trends in efficiency
38
OEM- Financial Analysis
7 Mahindra and Mahindra
3.33.0 2.8 2.9
2.6
2015 2016 2017 2018 2019
Fixed Asset Turnover Ratio
67
0 0
9
2015 2016 2017 2018 2019
Days Working Capital (Days)
2015 2016 2017 2018 2019
2424
22
25
28
Inventory Turnover days
2015 2016 2017 2018 2019
47
56
63
53
63
Average days payable outstanding
Higher = Better
Lower = Better Lower = Better
Lower = Better
➢ Out of all the 11 OEMs under study, Mahindra & Mahindra had the second highest EBITDA under study after Maruti Suzuki.
➢ Among these OEMs, Mahindra & Mahindra operated at the second highest average days payable outstanding at 63 days.
In FY 19
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Maruti Suzuki
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OEM- Financial Analysis
8 Maruti Suzuki OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
Maruti Suzuki
Manufacturing Sites in India
Gurgaon-HR Manesar-HR
Hansalpur-GJ
1750 K 1750 K 1750 K
90%101%
104%
0 K
200 K
400 K
600 K
800 K
1000 K
1200 K
1400 K
1600 K
1800 K
2000 K
0%
20%
40%
60%
80%
100%
120%
140%
FY 16-17 FY 17-18 FY 18-19
Installed Capacity Utilisation %
Prod. 1581 K 1768 K 1825 K
Capac. 1750 K 1750 K 1750 K
**
** This map is not to scale. It is an indicative outline intended for general reference use only.
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Maruti Suzuki
Trends in aggregates, profitability and costs
41
OEM- Financial Analysis
8 Maruti Suzuki
2015 20182016 2017 2019
50.057.5
68.079.8
86.0+15%
+18%
+15%
+17% +8%
2015 2017 20192016 2018
13.6
7.510.3
12.714.1
+37%+22%
+16%
+12%-4%
Net Sales
EBITDA
Aggregates (INR ‘000 Cr)
2015 2016 2017 2018 2019
6.8%
EBITDA Margin13.4%
5.8%
15.4%
7.1%
15.2%
7.4%
15.1%
5.7%
12.8%
PAT Margin
2015 2016 2017 2018 2019
Material Cost
3.6% 3.8%
71.1%
0.8%
3.2% 3.4%
1.4%
67.2%
69.2%
3.4%
1.2%
68.9%
0.8%
69.8%
1.0%Employee Cost
Power & Fuel Cost
2015 2016 2017 2018 2019
0.4% 0.1%
4.9%
0.4%0.1%
Depreciation 3.5%
4.9%3.8%
0.1%
3.5%
Interest
Profitability
Direct costs
Other costs
Margins (% of net sales)
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Maruti Suzuki
Trends in efficiency
42
OEM- Financial Analysis
8 Maruti Suzuki
1.9
3.8 3.6 3.73.3
2015 2016 2017 2018 2019
Fixed Asset Turnover Ratio
-25-33
-39
-28
2015 2016 2017 2018 2019
-24
Days Working Capital (Days)
2015 2016 2017 2018 2019
2022
16
20
16
Inventory Turnover days
2015 2016 2017 2018 2019
52
41
51
55
45
Average days payable outstanding
Higher = Better
Lower = Better Lower = Better
Lower = Better
➢ Maruti Suzuki saw a fall in PAT in FY 19 due to higher foreign exchange volatility, higher commodity prices and depreciation expenses.
➢ Maruti Suzuki had the highest EBITDA margin of the 4-wheeler manufacturers in FY 19.
In FY 19
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SML ISUZU
43
OEM- Financial Analysis
9 SML ISUZU OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
SML ISUZU
Manufacturing Sites in India
Ropar-PJ
9 K9 K
11%
51%
157%
5 K
6 K
6 K
7 K
7 K
8 K
8 K
9 K
9 K
10 K
10 K
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
FY 15-16 FY 17-18 FY 18-19
Installed Capacity Utilisation %
Prod. 1.26 K 12.1 K 14.1 K
Capac. 9 K 24 K 9 K
**
24 K
** This map is not to scale. It is an indicative outline intended for general reference use only.
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SML ISUZU
Trends in aggregates, profitability and costs
45
OEM- Financial Analysis
9 SML ISUZU
20162015 2017 2018 2019
1.1 1.21.4
1.1
1.4
+6%+16%
+6%
-16%+24%
2017
0.05
20162015
0.09
2018
0.11
2019
0.080.07
+25%
+23%
+1%
-58%
+63%
Net Sales
EBITDA
Aggregates (INR ‘000 Cr)
2015 2016 2017 2018 2019
EBITDA Margin
8.1%
3.9%2.5%
5.9%
7.4%
1.1%
4.3% 4.0%
0.5%
5.3%
PAT Margin
2015 2016 2017 2018 2019
10.3%Employee Cost
10.9%
76.9%
0.9%
10.7%
0.9%
76.7%
71.3%
0.8%
11.8%
79.7%
12.9%
1.0%
79.8%
0.8%
Material Cost
Power & Fuel Cost
2015 2016 2017 2018 2019
0.9%0.5%
2.5%
0.5%
1.8%
0.4%
1.8%1.7%1.1%
2.7%
Interest
Depreciation
Profitability
Direct costs
Other costs
Margins (% of net sales)
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SML ISUZU
Trends in efficiency
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OEM- Financial Analysis
9 SML ISUZU
4.74.1
5.7
2.7 3.0
2015 2016 2017 2018 2019
Fixed Asset Turnover Ratio
70 47
78 72
2015 2016 2017 2018 2019
66
Days Working Capital (Days)
2015 2016 2017 2018 2019
93
103
83
103
106
Inventory Turnover days
2015 2016 2017 2018 2019
6665
52 54
62
Average days payable outstanding
Higher = Better
Lower = Better Lower = Better
Lower = Better
➢ Improvement in sales was helped by stronger passenger vehicle demand and launch of the new ‘Global Series’ truck range.
➢ Light Commercial Vehicle sales grew thanks to demand from e-commerce and last mile delivery.
➢ SML Isuzu had the highest average days payable outstanding and inventory turnover.
In FY 19
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Tata Motors
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OEM- Financial Analysis
10 Tata Motors OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
Tata Motors
Manufacturing Sites in India
Pune-MH Sanand-GJ
Lucknow-UP Jamshedpur-JH
Pantanagar-UK Dharwad-KN1757 K
1570 K 1569 K
26%
36%
45%
1500 K
1550 K
1600 K
1650 K
1700 K
1750 K
1800 K
1850 K
1900 K
1950 K
2000 K
0%
20%
40%
60%
80%
100%
FY 16-17 FY 17-18 FY 18-19
Installed Capacity Utilisation %
Prod. 170 K 195 K 225 K
Capac. 704 K 516 K 516 K
Prod. 352 K 377 K 488 K
Capac. 1053 K 1053 K 1053 K**
** This map is not to scale. It is an indicative outline intended for general reference use only.** Total production capacity has been segregated into PV and CV capacity in the ratio of production volumes for the year.
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Tata Motors
Trends in aggregates, profitability and costs
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OEM- Financial Analysis
10 Tata Motors
2015 2016 2017 2018 2019
44.336.3
42.8
57.969.2
+18% +3%
+18%
+31%+20%
2015 20182016 2017 2019
0.2
3.9 3.92.3
7.3+1,505%
-42%
+135%
+73%
+87%
Net Sales
EBITDA
Aggregates (INR ‘000 Cr)
2015 2016 2017 2018 2019
-6.1%
-4.5%
-18.2% -7.7%
5.7%
-3.4%
2.9% 2.4%6.4%
-1.3%
EBITDA Margin
PAT Margin
2015 2016 2017 2018 2019
76.9%
8.7%67.9%
1.1%
7.4%
1.0%
8.5%
71.3%
1.1%
6.2%
72.3%
0.9%
6.9%
72.9%
0.9%
Material Cost
Employee Cost
Power & Fuel Cost
2015 2016 2017 2018 2019
5.4%4.4%
7.2%
3.5%3.7%
6.9%5.4%
3.0%Depreciation
2.6%
4.5%
Interest
Profitability
Direct costs
Other costs
Margins (% of net sales)
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Tata Motors
Trends in efficiency
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OEM- Financial Analysis
10 Tata Motors
1.1 1.1 1.11.3
1.5
2015 2016 2017 2018 2019
Fixed Asset Turnover Ratio
-23-46
-41-34
2015 2016 2017 2018 2019
-30
Days Working Capital (Days)
2015 2016 2017 2018 2019
36
21
31
3330
Inventory Turnover days
2015 2016 2017 2018 2019
46
3133
4649
Average days payable outstanding
Higher = Better
Lower = Better Lower = Better
Lower = Better
➢ Tata Motors had to contend with issues with its Jaguar Land Rover division, as well as restructuring following the shutdown of
manufacturing in Thailand.
➢ Tata Motors saw a 30% improvement in Inventory Turnover in FY 19.
In FY 19
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TVS
51
OEM- Financial Analysis
11 TVS OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
TVS
Manufacturing Sites in India
Hosur-TN Mysore-KN
Solan-HP4050 K 4500 K
5100 K
72%
78%
77%
1000 K
1500 K
2000 K
2500 K
3000 K
3500 K
4000 K
4500 K
5000 K
5500 K
0%
20%
40%
60%
80%
100%
FY 16-17 FY 17-18 FY 18-19
Installed Capacity Utilisation %
Prod. 68 K 99 K 156 K
Capac. 150 K 150 K 150 K
Prod. 2853 K 3395 K 3770 K
Capac. 3900 K 4500 K 4950 K**
** This map is not to scale. It is an indicative outline intended for general reference use only.
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TVS
Trends in aggregates, profitability and costs
53
OEM- Financial Analysis
11 TVS
2015
10.0
201820172016 2019
12.1
18.2
11.1
15.2
+11% +9%
+16%
+25%+20%
2015 20192016 2017 2018
0.60.9 1.0
1.31.4
+43% +13%
+23%
+24%+13%
Net Sales
EBITDA
Aggregates (INR ‘000 Cr)
2015 2016 2017 2018 2019
7.7%7.1%
6.0%
3.2% 3.6%
7.3%
3.7%3.5% 3.2%
7.9%
EBITDA Margin
PAT Margin
2015 2016 2017 2018 2019
71.2%
73.4%
5.9%
73.6%
5.9%
0.9% 0.8%
5.7%6.1%
0.7%
73.6%
0.7%
76.4%
5.1%
0.6%
Material Cost
Employee Cost
Power & Fuel Cost
2015 2016 2017 2018 2019
2.2%
1.5%
0.3% 0.4% 0.4%0.4%
2.1%2.4%
0.4%
2.2%
Interest
Depreciation
Profitability
Direct costs
Other costs
Margins (% of net sales)
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TVS
Trends in efficiency
54
OEM- Financial Analysis
11 TVS
3.6
1.1 1.1 1.3 1.5
2015 2016 2017 2018 2019
Fixed Asset Turnover Ratio
9
0 -1
-9
2015 2016 2017 2018 2019-4
Days Working Capital (Days)
2015 2016 2017 2018 2019
30
24
30
2524
Inventory Turnover days
2015 2016 2017 2018 2019
58
53
62
54
63
Average days payable outstanding
Higher = Better
Lower = Better Lower = Better
Lower = Better
➢ TVS saw improved sales over FY 19, partly supported by a strong increase in exports.
➢ After improving its inventory turnover days by 27% over FY 18, but saw a slight decline in FY 19.
➢ The end of the license Raj helped assist strong 3-Wheeler sales in FY 19.
In FY 19
OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents
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