ACMA- Financial Analysis...2 Atul Auto 14 3 Bajaj Auto 18 4 Escorts 22 5 Force Motors 26 6 Hero Motocorp 30 7 Mahindra and Mahindra 34 8 Maruti Suzuki 38 9 SML ISUZU 42 10 Tata Motors

www.pwc.com

OEMs- Financial Analysis FY 17

April 2018

PwC

25 April 2018Strictly private and confidential

List of Companies and Ratios 3

1 List of companies 4

2 Ratios used 5

Macro Economic Climate in India 6

OEM Financial analysis 9

1 Ashok Leyland 10

2 Atul Auto 14

3 Bajaj Auto 18

4 Escorts 22

5 Force Motors 26

6 Hero Motocorp 30

7 Mahindra and Mahindra 34

8 Maruti Suzuki 38

9 SML ISUZU 42

10 Tata Motors 46

11 TVS 50

Contents

2

OEMs- Financial Analysis

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OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


List of Companies and Ratios

3


List of Companies and Ratios 3

1 List of companies 4

2 Ratios used 5


PwC


List of companies included in the analysis

4


1 List of companies

1 Ashok Leyland

2 Atul Auto

3 Bajaj Auto

4 Escorts

5 Force Motors

6 Hero Motocorp

7 M & M

8 Maruti Suzuki

9 SML ISUZU

10 Tata Motors

11 TVS Motor Co.


PwC


Ratios used

5


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)


PwC


Macro Economic Climate in India

6



India-key economic indicators A steady growth is expected in the foreseeable future

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

2013 2014 2015 2016 2017 2018F 2019F 2020F

India: Projected GDP % Change2013 – 2020F (percentage)

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

0

35

70

105

140

175

210

2013 2014 2015 2016 2017 2018F 2019F 2020F

India: Industrial Production Index2013 – 2020F (points)

YoY Growth Rate (R-Axis)

India economic growth slowed down in FY 17 due to two major economic events –demonetisation (ban on the higher currency notes) and GST introduction – undertaken by the government

However, since then the economy seems to be back on the growth track and it is predicted to grow at a healthy rate in the foreseeable future

The industrial production index growth slowed down due to demonetization and GST implementation, however, it is expected to grow at a healthy rate in the foreseeable future


India-key economic indicators The private demand indicators also show a promising scenario for batter growth prospects

0%

5%

10%

15%

20%

0

1,000

2,000

3,000

4,000

5,000

2013 2015 2017 2019F

India: Disposable personal income2013 – 2024F (Real, US$)


5%

6%

7%

8%

9%

10%

2012 2014 2016 2018F 2020F

India: Unemployment Rate2013 – 2024 (percentage)

0%

3%

5%

8%

10%

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2013 2014 2015 2016 2017 2018F 2019F 2020F

India: Real Private Consumption2013 – 2024F (Real, US$ (billions))


1%

2%

2%

2%

2%

2%

800

850

900

950

1,000

1,050

2013 2014 2015 2016 2017 2018F 2019F 2020F

India: Working Age Population2013 – 2024F (millions)



PwC


OEM Financial analysis

9


OEM Financial analysis 9

1 Ashok Leyland 10

2 Atul Auto 14

3 Bajaj Auto 18

4 Escorts 22

5 Force Motors 26

6 Hero Motocorp 30

7 Mahindra and Mahindra 34

8 Maruti Suzuki 38

9 SML ISUZU 42

10 Tata Motors 46

11 TVS 50


PwC


Ashok Leyland

10


1 Ashok Leyland OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


Ashok Leyland

Capacity and utilisation

Manufacturing Sites* in India

Ennore-TN Hosur-TN

Bhandara-MH Alwar-RJ

Pantanagar-UK

150 K 150 K

160 K

70%

95% 95%

FY 14-15 FY 15-16 FY 16-17

Installed Capacity Utilisation %

Prod. 105 K 143 K 151 K

Capac. 150 K 150 K 160 K

**

* City - State

11


1 Ashok Leyland

** This map is not to scale. It is an indicative outline intended for general reference use only.

Source: Production volume from SIAM | Installed capacity via PwC secondary research


PwC


Ashok Leyland

Trends in aggregates, profitability and costs

12


1 Ashok Leyland

12

FY13

1014

FY14

19

FY15

20

FY16

+36%

FY17

-20%

+6%+40%

+13%

1.2

FY13

0.7

1.3

FY14

1.6

FY15

2.0

FY16

+69%

FY17

-40%

+28%

+25%

+13%

Net Sales

EBITDA

Aggregates (INR ‘000 Cr)

FY17

PAT Margin

EBITDA Margin

3%

9%

FY13

-1%

6%

FY14

2%

8%

FY15

1%

8%

FY16

5%

9%

2013 2014 2015 2016 2017

Employe cost

Power & Fuel Cost 0.6%

65.4%

7.6%

0.8%

Material cost

8.7%

0.6%

64.0%

60.4%

8.6%

0.7%

59.4%

10.1%

0.6%

63.6%

7.3%

2013 2014 2015 2016 2017

3%

Interest

Depreciation

1%

3%3%

3% 1%

5%

4%3%

3%

Profitability

Direct costs

Other costs

Margins and Costs (% of net sales)


PwC


Ashok Leyland

Trends in efficiency

13


1 Ashok Leyland

4.11

2.44

1.721.35

1.86

2013 2014 2015 2016 2017

Fixed Asset Turnover Ratio

Ashok Leyland has the 3rd highest FATO among the 11 OEMs studied as part of this report. Among the 5 OEMs with a significant CV sales

volume, only SML Isuzu has a greater FATO ratio (5.1) than Ashok Leyland (4.1).

Among these same 5 OEMs, only Tata Motors has a lower days working capital (-73.5 days) vs. Ashok Leyland’s (negative) 5.9 days’.

6

-9

-30

2013 2014 2015 2016 2017

-6

-39

Days working capital (Days)

2013 2014 2015 2016 2017

61

43

51

61

78

Inventory Turnover days

2013 2014 2015 2016 2017

113

74

102102

67


Higher = Better

Lower = Better Lower = Better

Lower = Better

In FY 17…

Source of all financial data : Capitaline Plus


PwC


Atul Auto

14


2 Atul Auto OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


Atul Auto



Rajkot, GJ

60 K 60 K60 K

69%74%

65%

FY 14-15 FY 15-16 FY 16-17


Prod. 41.5 K 44 K 39 K

Capac. 60 K 60 K 60 K

**

15


2 Atul Auto


* City - State



PwC


Atul Auto


16


2 Atul Auto

+7%

+18%-10%

+8%+15%

FY17

0

FY16

1

FY15

0

FY14

0

FY13

0

+10%

+15%-20%

+19%+35%

FY17

0.1

FY16

0.1

FY15

0.1

FY14

0.0

FY13

0.0

Net Sales

EBITDA


FY14

7%

FY17

13%

PAT Margin

11%

6%

FY13

11%

7%

12%

FY15

9%EBITDA Margin

FY16

14%

7%

2013 2014 2015 2016 2017

Power & Fuel Cost

Employe cost

Material cost

0.6%

8.2%

72.8%

0.6%

7.0%

73.1%

0.6%

6.6%

75.8%

0.6%

6.4%

74.8%

0.5%

5.8%

77.9%

2013 2014 2015 2016 2017

Depreciation

Interest

1.1%

0.1%

1.0%

0.1%

1.1%

0.1%

1.2%

0.1%

1.2%

0.1%

Profitability

Direct costs

Other costs



PwC


Atul Auto


17


2 Atul Auto

3.834.67

6.146.526.23

2013 2014 2015 2016 2017


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 average days payable outstanding (33.5 days) among the 11 OEMs.

At 73%, Atul Auto experienced the highest RM cost as % of sales among all the 11 OEMs.

65

46

2726

2013 2014 2015 2016 2017

35


2013 2014 2015 2016 2017

34

29

2324

27


2013 2014 2015 2016 2017

33

30

24

2827


Higher = Better


Lower = Better

In FY 17…



PwC


Bajaj Auto

18


3 Bajaj Auto OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


Bajaj Auto



Aurangabad-MH Pantnagar-UK

Chakan-MH

6000 K 6000 K 6060 K

64% 65%60%

FY 14-15 FY 15-16 FY 16-17


Prod. 524 K 527 K 446 K

Capac. 600 K 600 K 660 K

Prod. 3287 K 3345 K 3209 K

Capac. 5400 K 5400 K 5400 K**


* City - State

19


3 Bajaj Auto



PwC


Bajaj Auto


20


3 Bajaj Auto

FY13

20 20

FY14

22

FY15

23 22

FY16

+7%

FY17

+1%-4%

+5%

+2%

FY14

4.4

FY15

5.9 5.6

FY16

-9%

FY17

+9% -4%+34%

+6%

4.4 4.8

FY13

Net Sales

EBITDA


EBITDA Margin

10%

13%12%

20%

17%13%

11%

FY13

18%

20%21%

FY14 FY15 FY16 FY17

PAT Margin

2013 2014 2015 2016 2017

4.6%

0.5% 0.4%

61.0%

4.1%

Power & Fuel Cost

Material cost

Employe cost

0.5%

60.7%

4.2%

63.6%

0.5%

3.6%

64.2%

0.6%

3.2%

67.6%

2013 2014 2015 2016 2017

1%

0%

1%

0%

1%

0%

1%

0%

Depreciation

Interest

1%

0%

Profitability

Direct costs

Other costs



PwC


Bajaj Auto


21


3 Bajaj Auto

2013 2014 2015 2016 2017

5.06

5.51

5.305.26

5.89


Among all 11 OEMs studied as part of this report, Bajaj enjoys the highest profit margins at ~20% (EBIT %, EBITDA %, PAT %).

Bajaj, incidentally, also has the highest days working capital at 103.6 days. Over the 5 FYs studied, Bajaj has had the highest days working

capital in 2 instances (FY 15 and FY 17).

104

31

85

38

2013 2014 2015 2016 2017

16


2013 2014 2015 2016 2017

18

17

19

1616


2013 2014 2015 2016 2017

55

42

48

54

50


Higher = Better


Lower = Better

In FY 17… Source of all financial data : Capitaline Plus


PwC


Escorts

22


4 Escorts OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


Escorts



Faridabad-HR Rudrapur-UK

99 K 99 K 99 K

59%53%

65%

FY 14-15 FY 15-16 FY 16-17


Prod. 59 K 52 K 65 K

Capac. 99 K 99 K 99 K

**


* City - State

23


4 Escorts



PwC


Escorts


24


4 Escorts

+1%

+62%

+22%-16%

-37%

FY17

4

FY16

3

FY15

4

FY14

6

FY13

4

0.2

FY14

0.5

FY13

0.2

+9%

+100%

+62%

+6%

-59%

FY17

0.3

FY16

0.2

FY15

Net Sales

EBITDA


EBITDA Margin

PAT Margin

FY17

7%

3%

FY16

4%

1%

FY15

3%

0%

FY14

6%

3%

FY13

5%

1%

2013 2014 2015 2016 2017

Power & Fuel Cost

Material cost

0.9%

10.7%

63.8%

1.1%

11.9%

65.0%

1.1%

10.8%

64.3%

1.0%

10.6%

67.1%

1.0%

10.4%

66.4%

Employe cost

2013 2014 2015 2016 2017

1%

1%

2%

2%

1%Depreciation

Interest 2%1%

2%

1%2%

Profitability

Direct costs

Other costs



PwC


Escorts


25


4 Escorts

1.671.38

1.65

2.60

1.70

2013 2014 2015 2016 2017


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 a high Employees cot (as % of Net Sales) at 10.7%. Only OEM to have experienced a higher % was Force Motors at 11.4%.

It also had the second lowest EBITDA Margin at 7% - higher only than Tata Motors which was at ~3% in FY17.

16

30

14

2013 2014 2015 2016 2017

3

19


2013 2014 2015 2016 2017

52

5655

42

63


2013 2014 2015 2016 2017

42

83

6365

79


Higher = Better


Lower = Better

In FY 17…



PwC


Force Motors

26


5 Force Motors OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


Force Motors



Pune-MH Pithampura-MP

Urse-MH Chennai-TN

Chakan-MH

99 K 99 K 99 K

29%33% 30%

FY 14-15 FY 15-16 FY 16-17


Prod. 24 K 28 K 26 K

Capac. 75 K 75 K 75 K

Prod. 4.5 K 5 K 3.6 K

Capac. 24 K 24 K 24 K **


* City - State

27


5 Force Motors



PwC


Force Motors


28


5 Force Motors

+1%+28%

+2%

+12%

FY17

+17%

3

FY16

3

FY15

2

FY14

2

FY13

2

+38%

+2%

FY15

+61%0.4+36%

+62%

FY17FY16

0.3

0.20.2

0.1

FY13 FY14

Net Sales

EBITDA


PAT Margin

EBITDA Margin

9%

3%

FY17

4%

9%

FY16

2%

6%

FY15

1%

5%

FY14FY13

3%

-1%

2013 2014 2015 2016 2017

1.5%

69.7%Material cost 69.9%

11.4%

74.0%

1.5%

11.9%

73.0%

10.1%11.7%

1.6%1.9% 1.9%

13.3%Employe cost

Power & Fuel Cost

69.4%

2013 2014 2015 2016 2017

4%

0%

3%

Interest 0% 0%

4%

0%

4%

3%Depreciation

0%

Profitability

Direct costs

Other costs



PwC


Force Motors


29


5 Force Motors

1.751.96

1.591.45

1.71

2013 2014 2015 2016 2017


Force Motors had the second highest days working capital (70.4 days) – with only Bajaj having a higher ratio at ~104 days.

Force Motors also had the second highest inventory turnover ratio at 60.7.

The OEM experienced highest employees cost (as % of net sales) across all 11 OEMs studied as part of this study (at >11% for FY17).

61

6267

2013 2014 2015 2016 2017

70

63


2013 2014 2015 2016 2017

61

74

69

7776


2013 2014 2015 2016 2017

61

6769

50

57


Higher = Better


Lower = Better

In FY 17…



PwC


Hero Motocorp

30


6 Hero Motocorp OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


Hero MotoCorp



Haridwar-UK Dharuhera-HR

Gurgaon-HR Neemrana-RJ

Vadodara-GJ

7570 K

8050 K 8050 K

88%82% 83%

FY 14-15 FY 15-16 FY 16-17


Prod. 6645 K 6613 K 6646 K

Capac. 7570 K 8050 K 8050 K

**


* City - State

31


6 Hero Motocorp



PwC


Hero Motocorp


32


6 Hero Motocorp

+5%

+6% 0%+3%+9%

FY17

28

FY16

28

FY15

28

FY14

25

FY13

24

+9%

+8%

+6%+26%

-3%

FY17

5.2

FY16

4.9

FY15

3.9

FY14

4.0

FY13

3.7

Net Sales

EBITDA


EBITDA Margin

PAT Margin

FY17

16%

10%

FY16

16%

10%

FY15

12%

7%

FY14

14%

7%

FY13

14%

7%

2013 2014 2015 2016 2017

3.5%

73.1%

Power & Fuel Cost

Employe cost

Material cost

0.4%

4.9%66.5%

0.4%

4.6%

67.9%

0.6%

4.3%

71.7%

0.5%

3.7%

72.1%

0.5%

2013 2014 2015 2016 2017

1.96%

0.04% 0.02%

1.54%4.38%

0.05%

4.80%

0.05%

Depreciation

0.02%Interest

1.73%

Profitability

Direct costs

Other costs



PwC


Hero Motocorp


33


6 Hero Motocorp

5.146.18

8.087.788.09

2013 2014 2015 2016 2017


35

1914

2013 2014 2015 2016 2017

43

16


2013 2014 2015 2016 2017

1212

14

1313


2013 2014 2015 2016 2017

43

57

46

37

46


Higher = Better


Lower = Better

In FY 17…


Hero Motocorp had the second highest profit margins bettered only by Bajaj across EBITDA %, EBIT % and PAT %.

The OEM boasts of the highest FATO (5.1) among the peer-set of 11 OEMs studied as part of this report.

Among these OEMs, Hero Motocorp also demonstrated the best average inventory turnover days at 11.6 for FY17.


PwC


Mahindra and Mahindra

34


7 Mahindra and Mahindra OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


Mahindra & Mahindra



Haridwar-UK Mumbai-MH

Zaheerabad-AP Nashik-MH

Chakan-MH Pithampur-MP

2244 K

1994 K2094 K

39%44%

40%

FY 14-15 FY 15-16 FY 16-17


Prod. 464 K 500 K 498 K

Capac. 868 K 868 K 968 K

Prod. 227 K 218 K 274 K

Capac. 376 K 376 K 376 K

Prod. 174 K 167 K 57 K

Capac. 1000 K 750 K 750 K**


* City - State

35


7 Mahindra and Mahindra



PwC




36



+2%

0%+7%+6%

-5%

FY17

44

FY16

41

FY15

38

FY14

41

FY13

40

6.7

FY17

-2%+3%

+20%

FY16FY15

5.4

FY14

5.5

FY13

5.3 5.5

+6%

+3%

Net Sales

EBITDA


12%

FY13

7%

EBITDA Margin

PAT Margin

FY17

12%

6%

FY16

11%

6%

FY15

12%

6%

FY14

12%

8%

2013 2014 2015 2016 2017

Power & Fuel Cost

Employe cost

Material cost

0.5%

5.9%

47.8%

0.6%

5.7%

47.4%

0.6%

6.0%

52.7%

0.5%

5.3%

53.3%

0.5%

4.6%

51.3%

2013 2014 2015 2016 2017

3.03%2.61%

Depreciation

Interest 0.33%0.46%

2.54%

0.56%

2.13%

0.64%

1.76%

0.47%

Profitability

Direct costs

Other costs



PwC




37



3.593.723.82

4.825.55

2013 2014 2015 2016 2017


M&M operated at the second-to-highest average days payable outstanding among the 11 OEMs studied as part of this report.

Its EBITDA margin % at 12% was significantly higher than that of Tata Motors.

For both the metrics of days’ working capital and inventory turn-over, M&M was at the median vs. this peer-set of 11 OEMs.

16

11

7

2013 2014 2015 2016 2017

25

23


2013 2014 2015 2016 2017

41

44

38

42

38


2013 2014 2015 2016 2017

91

108

8488

108


Higher = Better


Lower = Better

In FY 17…



PwC


Maruti Suzuki

38


8 Maruti Suzuki OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


Maruti Suzuki



Gurgaon-HR Manesar-HR

Hansalpur-GJ1500 K 1500 K

1750 K

87%95%

90%

FY 14-15 FY 15-16 FY 16-17


Prod. 1308 K 1424 K 1581 K

Capac. 1500 K 1500 K 1750 K

**


* City - State

39


8 Maruti Suzuki



PwC


Maruti Suzuki


40


8 Maruti Suzuki

+12%

0%

+18%+15%

+14%

FY17

68

FY16

58

FY15

50

FY14

44

FY13

44

+17%

+22%+37%

+27%

FY17

12.6

FY16

10.3

FY15

7.5

FY14

+26%

5.0

FY13

5.9

Net Sales

EBITDA


4%

10%

FY13

5%

12%

FY14 FY15

13%

6%

FY16

15%

7%

FY17

15%

7%EBITDA Margin

PAT Margin

2013 2014 2015 2016 2017

69.6%

2.5%1.1% 1.4%

3.1%

66.0%

1.4%3.2%

65.8%

1.2%

3.4%61.7%

0.8%

3.4%

62.7%

Power & Fuel Cost

Employe cost

Material cost

2013 2014 2015 2016 2017

Depreciation

0.4%

6.0%

4.1%

0.4% 0.1%0.4%

7.2% 6.7%5.4%

0.1%Interest

Profitability

Direct costs

Other costs



PwC


Maruti Suzuki


41


8 Maruti Suzuki

4.58

2.232.252.26

3.01

2013 2014 2015 2016 2017


Among the subset of those OEMs with a significant PV volume, MSIL has had the highest EBITDA margin % for 3 consecutive years.

After TML, MSIL had the second-lowest average days’ working capital in FY17.

Across all 11 OEMs, MSIL has the lowest employee cost as % of net sales for each of the 5 FYs.

-25-20-5

35

2013 2014 2015 2016 2017

50


2013 2014 2015 2016 2017

26

2120

30

28


2013 2014 2015 2016 2017

66

47

56

70

57


Higher = Better


Lower = Better

In FY 17…



PwC


SML ISUZU

42


9 SML ISUZU OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


SML ISUZU



Ropar-PJ

9 K 9 K 9 K

11% 11% 14%

FY 14-15 FY 15-16 FY 16-17


Prod. 1 K 0.97 K 1.26 K

Capac. 9 K 9 K 9 K

**


* City - State

43


9 SML ISUZU



PwC


SML ISUZU


44


9 SML ISUZU

+8%

-12%

+17%+6%+25%

FY17

1

FY16

1

FY15

1

FY14

1

FY13

1

+19%

-50%

+27%+37%

+132%

FY17

0.10

FY16

0.08

FY15

0.06

FY14

0.03

FY13

0.05

Net Sales

EBITDA


EBITDA Margin

PAT Margin

FY17

8%

4%

FY16

7%

4%

FY15

6%

3%

FY14

4%

1%

FY13

7%

3%

2013 2014 2015 2016 2017

Power & Fuel Cost

Employe cost

Material cost

0.8%

10.3%

67.2%

0.9%

10.7%

73.1%

0.9%

10.9%

73.7%

1.0%

10.7%

76.2%

0.8%

8.1%

73.2%

2013 2014 2015 2016 2017

Depreciation

Interest

1.7%

0.3%

1.7%

0.4%

1.8%

0.5%

1.5%

0.7%1.2%

1.9%

Profitability

Direct costs

Other costs



PwC


SML ISUZU


45


9 SML ISUZU

5.075.205.124.36

5.39

2013 2014 2015 2016 2017


Among all 11 OEMs, SML Isuzu had the highest average inventory turnover days ratio at ~100 days.

Among the CV and PV manufacturers SML Isuzu had the lowest average days payable outstanding. The only OEMs with a lower average

days payable outstanding were from the 2W and 3W segments (Hero MotoCorp, Bajaj, and Atul Auto).

4553

5852

2013 2014 2015 2016 2017

64


2013 2014 2015 2016 2017

100

124

110

114

102


2013 2014 2015 2016 2017

77

64

77

49

63


Higher = Better


Lower = Better

In FY 17…



PwC


Tata Motors

46


10 Tata Motors OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


Tata Motors



Pune-MH Sanand-GJ

Lucknow-UP Jamshedpur-JH

Pantnagar-UK Dharwad-KN2164 K 2164 K

2018 K

23% 23% 26%

FY 14-15 FY 15-16 FY 16-17


Prod. 175 K 155 K 170 K

Capac. 790 K 790 K 704 K

Prod. 327 K 352 K 352 K

Capac. 1374 K 1374 K 1314 K**


* City - State

47


10 Tata Motors



PwC


Tata Motors


48


10 Tata Motors

0%

-23%+4%+18%

+6%

FY17

44

FY16

43

FY15

36

FY14

34

FY13

45

-11%

-29%

-45%

+1,505%

-90%

FY17

2.1

FY16

3.9

FY15

0.2

FY14

2.4

FY13

3.4

Net Sales

EBITDA


EBITDA Margin

PAT Margin

FY17

3%

-8%

FY16

6%

-3%

FY15

-5%

-18%

FY14

-4%

-10%

FY13

3%

-4%

2013 2014 2015 2016 2017

Power & Fuel Cost

Employe cost

Material cost

1.0%

8.0%

62.3%

1.0%

7.4%

58.3%

1.1%

8.5%

61.0%

1.1%

8.4%

59.8%

1.1%

6.3%

60.9%

2013 2014 2015 2016 2017

Depreciation

Interest

7%

4%

5%4%

7%

4%6%

4%

4%

3%

Profitability

Direct costs

Other costs



PwC


Tata Motors


49


10 Tata Motors

1.411.75

1.581.56

2.19

2013 2014 2015 2016 2017


Tata Motors has the lowest of days working capital across all the OEMs studied as part of this report. Closest OEM to TML on this metric

is Maruti Suzuki at (negative) 25days of working capital.

Furthermore, Tata Motors also has one of the lowest FATO ratio (1.41) . Note that the same for M&M is 3.6 and for MSIL is 4.6.

-75-58

-119

-89

2013 2014 2015 2016 2017

-128


2013 2014 2015 2016 2017

6061

63

55

49


2013 2014 2015 2016 2017

137

123116

93

108


Higher = Better


Lower = Better

In FY 17…



PwC


TVS

50


11 TVS OEM Financial analysisMacro Economic Climate in IndiaList of CompaniesContents

PwC


TVS



Hosur-TN Mysore-KN

Solan-HP

3750 K4050 K 4050 K

67%65% 72%

FY 14-15 FY 15-16 FY 16-17


Prod. 109 K 112 K 68 K

Capac. 150 K 150 K 150 K

Prod. 2419 K 2532 K 2853 K

Capac. 3600 K 3900 K 3900 K**


* City - State

51


11 TVS



PwC


TVS


52


11 TVS

+14%

+11%

+9%+11%

+26%

FY17

12

FY16

11

FY15

10

FY14

8

FY13

7

+32%

+49%

+13%+43%

+25%

FY17

1.0

FY16

0.9

FY15

0.6

FY14

0.5

FY13

0.3

Net Sales

EBITDA


EBITDA Margin

PAT Margin

FY17

7%

3%

FY16

7%

3%

FY15

6%

3%

FY14

6%

3%

FY13

4%

1%

2013 2014 2015 2016 2017

Power & Fuel Cost

Employe cost

Material cost

0.7%

6.1%

71.0%

0.8%

5.9%

69.0%

0.9%

5.9%

71.3%

1.0%

6.0%

68.0%

1.3%

5.7%

68.3%

2013 2014 2015 2016 2017

Depreciation

Interest

2.4%

0.4%

2.1%

0.4%

1.5%

0.3%

1.7%

0.3%

1.8%

0.7%

Profitability

Direct costs

Other costs



PwC


TVS


53


11 TVS

3.604.034.14

3.583.36

2013 2014 2015 2016 2017


TVS Motors experienced the second-to-highest RM cost as % of Net Sales among the 11 OEMs studied as part of this report. The company

reported the metric at 71%. The only OEM among this peer-set with a higher % cost was Atul Auto at 73%.

It is the only 2W manufacturer with negative days working capital consistently over the past 4 years.

-20

-14

-8-7

2013 2014 2015 2016 2017

-6


2013 2014 2015 2016 2017

37

30

38

3334


2013 2014 2015 2016 2017

71

6668

60

54


Higher = Better


Lower = Better

In FY 17…



This document has been prepared solely for [ACMA] Automotive Component Manufacturers Association of India, being the express addressee to thisdocument. PwC does not accept or assume any liability, responsibility or duty of care for any use of or reliance on this document by anyone, other than (i)ACMA, to the extent agreed in the relevant contract for the matter to which this document relates (if any), or (ii) as expressly agreed by PwC in writing inadvance.

This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon theinformation contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to theaccuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PwC, its members, employees and agents acceptno liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained inthis publication or for any decision based on it.

This publication contains certain examples extracted from third party documentation and so being out of context from the original third party documents;readers should bear this in mind when reading the publication. The copyright in such third party material remains owned by the third parties concerned, andPwC expresses its appreciation to these companies for having allowed it to include their information in this publication. For a more comprehensive view oneach company’s communication, please read the entire document from which the extracts have been taken. Please note that the inclusion of a company in thispublication does not imply any endorsement of that company by PwC nor any verification of the accuracy of the information contained in any of the examples.

This publication contains various companies’ forward looking statements, which by their nature involve numerous assumptions, inherent risks anduncertainties, both general and specific, and risks that predictions, forecasts, projections and other forward looking statements will not be achieved. We cautionreaders of this publication not to place undue reliance on these forward looking statements, as a number of important factors could cause actual future results todiffer materially from the plans, objectives, expectations, estimates, and intentions expressed in such forward looking statements.

PwC contacts for ACMA Knowledge Partnership- Kavan Mukhtyar, Partner & Leader-Automotive, PwC India - [email protected] / +912261198735- Manas Trivedi, ACMA Knowledge Partnership Manager –[email protected] / +911246266594

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Documents

ACMA- Financial Analysis...2 Atul Auto 14 3 Bajaj Auto 18 4 Escorts 22 5 Force Motors 26 6 Hero Motocorp 30 7 Mahindra and Mahindra 34 8 Maruti Suzuki 38 9 SML ISUZU 42 10 Tata Motors