CFO Investors Meet Nov 2011

7/31/2019 CFO Investors Meet Nov 2011

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Investors Meet

November 2011


2/50

Presentation outline

Overview of Hinduja Group

CV Industry Trend and Outlook

ALs PerformanceCapex / Investments / Funding

AL Strategies / Plans

Volumes & Margin outlook

Joint Ventures

AL / CFO / IR / Nov11 2


3/50

`Hinduja Group Overview

Led by the Hinduja Bank inGeneva, and the IndusInd Bank inIndia, offers a range of services toits ever-growing international

client base

Gulf Oil is arguably one of the mostevocative names in the oil industryserving the needs of the motorist and of

industry for more than a century.

HTMT IT Services spearheads the Group's ITactivities by providing professional resourcesof highest quality services and full range ofsoftware solutions across several industriesfor clients in India and overseas.

The Hinduja presence in media &communications helps realize innumerableexciting infotainment products

Hinduja Group is engaged in realestate development projects, involvingboth commercial and residentialproperty

Ashok Leyland is India's second largestcommercial vehicles and diesel enginemanufacturer and Hinduja Group's

flagship company in India.

Automotive

IT / ITES Banking & Finance

Infrastructure

Hinduja group was established in 1914 in Mumbai

Employs more than 50,000 personnel worldwide

Global presence across 30 countries

Media & Entertainment

Energy & Chemicals

AL / CFO / IR / Nov11
http://images.google.co.in/imgres?imgurl=http://www.roadtransport.com/blogs/big-lorry-blog/Ashok-L%20Newgen%208x4.JPG&imgrefurl=http://www.roadtransport.com/blogs/big-lorry-blog/2007/10/new-ashok-leyland-tippers-a-pr.html&usg=__THErXL9g_xvWOimDVxcO3-J7y7A=&h=336&w=407&sz=32&hl=en&start=29&tbnid=Xdz0wDXDlcEIHM:&tbnh=103&tbnw=125&prev=/images?q=ashok+leyland&gbv=2&ndsp=20&hl=en&sa=N&start=20


4/50

CV Industry Trend and Outlook


5/50

Freight generating sectorsperformance


RBI in its recentcredit policy hasindicated a GDPgrowth rate of 7.6%.(against 8.0% earlier)

Growth is expectedto accelerate in II half

/ FY12

5Source: CMIE Oct 11

*Till July 11 Demand for steel is likely to pick up in HY 2 FY 12, with industrial and infrastructuralconstruction activity gathering pace.

As the monsoon season comes to end, demand for cement likely to go up as constructionactivity is expected to pick up.

Ministry of Environment & Forests has decided to scrap go/no go classification of coal blocks.This will give a major boost to the coal production in coming months.

Growth in cargo traffic is likely to be supported by significant growth in Indias foreign trade.

Actual

Apr-Aug

2011-12

Estimate 2010-11Major Crops Production NA 1.6% 14.6%

Steel * 7.9% 8.0% 8.9%

Cement 3.7% 7.2% 4.5%

Coal -2.4% 5.0% -0.3%

Crude Oil 6.1% 4.0% 11.9%Port Cargo Traffic 4.5% 3.0% 1.6%

Exports 54.0% 22.0% 41.3%

Imports 40.6% 26.0% 22.5%

IIP * 5.8% 7.7% 8.2%


6/50

Infrastructure plan NHAI projectsNHAI Projects Kms

Total length 50 024

Completed (till Aug11) 16 117

Under Imp. / Balance 33 907

Golden Quad 5846 5828 100NS-EW Ph I & II 7300 5810 80NHDP Ph III 12109 2555 21NHDP Ph IV 14799 -- --NHDP Ph V 6500 652 10NHDP Ph VI /VII 1700 -- --Port conn/Others 1770 1272 72

Total CompletedKms Kms %

GQ gave impetus during 2003-07

Similar growth can be expected fromother phases

Contract under implementation for10830 Kms



7/50

Road transport continues to takeshare from Indian Railways

Railways share of freight traffic fell from 40% in 2000-01 to 30% in 2009-10

7

86 82

70

61

61

40

30

0

10

20

30

40

50

60

70

80

90

100

1950-51 1960-61 1970-71 1980-81 1990-91 2000-01 2009-10

Railways

Share of freight (bn tonne km)

84

48

36

3030

19

15

0

10

20

30

40

50

60

70

80

90

1950-51 1960-61 1970-71 1980-81 1990-91 2000-01 2009-10

RailwaysShare of Passengers (bn tonne km)


Source: SBI Caps Research


8/50

Freight rates movement

Post diesel price hike, except in few pockets in East, operators are able to pass

on the increase to customers

Source: Business Line


Rates given above are for 1 tonne (16 tonne capacity)

8

0.00

0.50

1.00

1.50

2.00

2.503.00

3.50

Nov-08 Nov-09 Nov-10 Feb-11 May-11 Aug-11 Sep-11 Nov-11

(Rs.

'000)

Truck rates from Kolkata to major cities

Chennai Delhi Mumbai Bangalore

0.00

1.00

2.00

3.00

4.00


(Rs.

'000)

Truck rates from Chennai to major cities

Calcutta Delhi Mumbai Bangalore

0.00

0.501.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50


(Rs.

'000)

Truck rates from Delhi to major cities

Calcutta Chennai Mumbai Bangalore

0.00

0.501.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50


(Rs.

'000)

Truck rates from Mumbai to major cities

Calcutta Chennai Delhi Bangalore


9/50

Interest rate movement

Current rates ranges from 13.5% to

17.0% for First Time Users, 12.5% to15.5% for Small Road TransportOperators, 11.5% to 14.5% for LargeFleet operators.

Rates have hardened by 200 bpsover the last one year.

Increase of Repo rates by RBI by25 bps. Consequent increase ininterest rate yet to be passed on tocustomers fully

No specific stress in collectionsexcept in some parts of Karnataka,

AP and Goa (due to cessation of ironore mining activities)

There are no constraints in availabilityof Finance

Net NPAs of NBFCs are at low levels

(less than 0.5%)AL / CFO / IR / Nov11 9

AccreditedPvt

Financiers,81.0%

PSBs/ OtherBanks, 9.7%

Own Funding,5.8% Other Modes,

3.5%


10/50

CV Market Performance Trucks


(Detailed Report - Crisil Research Oct 11)

Decrease in MAV TIV (32%) in Southern Region, partially offset by 14% Increase inICV TIV

21% TIV drop in Tractor Trailer in Western region More buying by First Time Users (FTUs) rather than large fleet operators in North Tipper segment which has shorter replacement cycles of 4-5 yrs is witnessing

strong replacement demand Tipper segment in FY 07 & 08 witnessed volumes which have been historical peaks

so far and the replacement volumes of the historical highs are likely to support near

term tipper demand.

Haulage (16T) 6586 7835 14421 8007 9129 17136 (14) (16) 19

Tippers (16T-31T) 10396 14729 25125 7816 10137 17953 45 40 42

Tractor Trlrs (30T-49T) 6344 7190 13534 6065 8035 14100 (11) (4) 13

MAV (22T-31T) 27294 27706 55000 26222 27492 53714 1 2 2

ICV (9T-15T) 13471 16267 29738 11510 12105 23615 34 26 21

Total 64091 73727 137818 59620 66898 126518 10 9 15

HY1

Y-o-Y

Q2

Q-o-Q

Q2

FY 12

Q2

FY 11Segment

Q1

FY 12

HY1

FY 12

Q1

FY 11

HY1

FY 11

Q2

Y-o-Y


11/50

CV Market Performance - Buses


In Q1/Q2 FY12, no orders from STUs underJnNURM scheme. Rising fuel cost could drive the shift to public transport. Improving national highway infrastructure would boost inter-city travel by road. Demand from niche segments viz., IT, BPO, schools and corporates to boost

demand for buses in cities

Private 3749 4581 8330 4028 4855 8883 (6) (7) 22

STU 3134 3030 6164 3477 4800 8277 (37) (26) (3)

ICV 4026 4197 8223 4223 3469 7692 21 7 4

Total 10909 11808 22717 11728 13124 24852 (10) (9) 8

Q2Y-o-Y

HY1Y-o-Y

Q2Q-o-Q

Q2FY 12

Q2FY 11

Segment Q1FY 12

HY1FY 12

Q1FY 11

HY1FY 11


12/50

Growth outlook M & HCV Trucks

YOY Growth %

Source: SIAM, CRISIL Research

Volume

in000s

12

Emission change in Oct 10

Led to advancing purchases to I half / 2010-11AL / CFO / IR / Nov11

31

45

51

74

60

67

62

87

64

74

65

90

0

10

20

30

40

50

60

70

80

90

100

Q1 FY10 Q2 FY10 Q3 FY10 Q4 FY10 Q1 FY11 Q2 FY11 Q3 FY11 Q4 FY11 Q1 FY12 Q2 FY12 Q3FY12P

Q4FY12P

Q1 Q2 Q3 Q4 Annual

2010-11 90 48 21 17 36

2011-12 7 10 5 4 5-7%


13/50

Growth outlook - Buses

YOY Growth %

Source: SIAM, CRISIL Research

Volum

ein000s

13

Emission change in Oct 10Led to advancing purchases to I half / 2010-11


79

12

14

12

13

10

13

11

1212

14

0

2

4

6

8

10

12

14

16

Q1

FY10

Q2

FY10

Q3

FY10

Q4

FY10

Q1

FY11

Q2

FY11

Q3

FY11

Q4

FY11

Q1

FY12

Q2

FY12

Q3

FY12P

Q4

FY12P

Q1 Q2 Q3 Q4 Annual

2010-11 57 40 -12 -14 11

2011-12 -7 -10 11 10 4-6%


14/50

Outlook appears promising

Positives:

Freight generating sectors of the Economy are doing well(revival seen in construction & mining)

Replacement demand exists for tippers

Better road systems will increase demand for superior,

factory built vehiclesIncreasing trend seen in freight rates in all pockets postdiesel price hike.

No under utilisation of fleet capacity

Restriction on overloading across states

Negatives:

Further rise in fuel prices subsidy on Diesel could bequestioned

Inflation / Interest rates negative outlook



15/50

Ashok Leylands Performance


16/50

ALs performance HY 1 FY 12


AL market share in Bus segment in HY1/FY12 improved over last year

Segment Q1

FY'11

Q2

FY'11

HY1

FY'11

FY

2010-11

Q1

FY'12

Q2

FY'12

HY1

FY'12

Bus TIV 11728 13082 24810 72363 10909 11808 22717

Growth Y-O-Y % 56.7 40.1 47.5 68.0 (7.0) (9.7) (8.4)

- ALL 4184 5435 9619 30044 4355 4741 9096

Growth Y-O-Y % 89.2 49.0 64.2 83.1 4.1 (12.8) (5.4)

- ALL MS% 35.7 41.5 38.8 41.5 39.9 40.2 40.0

Truck TIV 59620 66899 126519 401754 64091 73727 137818

Growth Y-O-Y % 89.8 47.6 64.9 99.0 7.5 10.2 8.9ALL 15058 16657 31715 94389 12277 15547 27824

Growth Y-O-Y % 238.3 90.1 140.0 131.7 (18.5) (6.7) (12.3)

-ALL MS% 25.3 24.9 25.1 23.5 19.2 21.1 20.2

Total TIV 71348 79981 151329 474117 75000 85535 160535

Growth Y-O-Y % 83.5 46.3 61.7 93.6 5.1 6.9 6.1

ALL 19242 22092 41334 124433 16632 20288 36920

Growth Y-O-Y % 188.8 78.0 116.7 117.8 (13.6) (8.2) (10.7)

-ALL MS% 27.0 27.6 27.3 26.2 22.2 23.7 23.0

Drop in MS inTruck due to: Decrease in

MAV TIV (32%)in SouthernRegion

21% TIV drop inTractor Trailer

TIV in Westernregion

More buying byFirst Time Users(FTUs) thanlarge fleetoperators inNorth


17/50

ALs exports performance

Country / zone wise exports in comparison with PY is given under:

Middle East - showing signs of recovery.

Growth in Sri Lanka & Bangladesh markets sustained. Targeting 30% growth (13000 vehicles)in FY 12. Share of exports in Total volume expected to be reach 15% in 3 years

Volume in Nos.

17AL / CFO / IR / Nov11

Q 1 Q2 HY1 Q 1 Q 2 HY1 FY

Sri Lanka 1345 1714 3059 761 1135 1896 5503

Bangladesh 554 574 1128 644 581 1225 2325

Middle East 405 624 1029 371 413 784 1355

Others 235 318 553 164 221 385 1123

Total 2539 3230 5769 1940 2350 4290 10306

2010-112011-12 HY 1FY12

registered35%increaseover PY


18/50

Defence, Spares & Power Solutions

Sale of Stallion kits to VFJ has increased more than five foldin HY1/FY12 to Rs.170 Cr (PY Rs.27 Cr); Balancesupplies in second half against order for 2700 kits.

Sale of FBVs to Indian Defence has gone up by more thansix times in HY1/FY12 to 121 vehicles (PY 17 vehicles)

Spares (Domestic & Exports) revenue at Rs.377 Cr inHY1/FY12 has registered a 18.7% growth (HY1/PY Rs.318 Cr)

Though Sale of engines in Q2 was flat, engines salesregistered a drop of 8% in HY1/FY12 over PY due to lower

supplies to Telecom industry


Engines

Q 1 Q 2 HY 1 Q 2 HY 1 Q 1 Q 2 HY 1

Manufactured 2293 2431 4724 (0.1) (5.2) 2548 2434 4982

Leypower 246 226 472 (47.3) (47.1) 464 429 893

Traded 866 716 1582 25.8 7.2 907 569 1476

Total 3405 3373 6778 (1.7) (7.8) 3919 3432 7351

2011-12 2010-11% Inc/(dec) over


19/50

Segment wise Revenue split


HY1 FY 12 Revenue Break up HY1 FY 11 Revenue Break up

Bus

17%

Defence Kits

& Spares

9%

Exports

10%

Engines

2%

Cyclical

61%

Bus 19%

Defence

Kits &

Spares 6%

Exports 9%

Engines 2%

Cyclical

64%

Higher exports & defence volumes have improved the non-cyclicalrevenue.

ALs share in cyclical business has come down by 3% in HY1 Targeting to achieve non-cyclical revenue share of 50% in next few

years


20/50

Qtr 2 FY 12 Financial PerformanceRs Lakhs

Revenue up primarily due to pricing actions (in CY & PY) and also due to higherspares and defence sales in CY.

Material cost contained to be at the same level of last year Lower volumes and higher operating cost have resulted in lower operating

margin (by 0.5%) Vehicle sales from PNR @ 8090 in Q2/FY12 vs. 1533 in PY Fresh borrowings in HY 2 of FY 11 & higherworking capital resulted in higher

Financial Expenses


Q2

2011-12

% of

Net

Sales

Q2

2010-11

% of

Net

Sales

YOY %

growth

HY1

2011-12

% of

Net

Sales

FY

2010-11

% of

Net

SalesNet Sales / income from operations 309457 100.0 271395 100.0 14.0 559008 100.0 1111771 100.0Consumption of raw materials 227574 73.5 199692 73.6 14.0 407384 72.9 812117 73.0Employee cost 25151 8.1 21148 7.8 18.9 50125 9.0 95972 8.6Other expenditure 23617 7.6 20072 7.4 17.7 43921 7.9 81926 7.4Gross operating margin 33115 10.7 30483 11.2 8.6 57577 10.3 121756 11.0Financial expenses 6270 2.0 3948 1.5 58.8 11604 2.1 16366 1.5

Other income 1033 0.3 624 0.2 65.6 1444 0.3 1533 0.1Gross Profit (PBDT) 27878 9.0 27159 10.0 2.6 47417 8.5 106923 9.6Depreciation 8593 2.8 6406 2.4 34.1 17059 3.1 26743 2.4Profit from ord activities before tax 19285 6.2 20753 7.6 (7.1) 30358 5.4 80180 7.2Net Profit 15408 5.0 16706 6.2 (7.8) 24033 4.3 63130 5.7


21/50

Capex, Investments & Funding


22/50

Capital Expenditure

Capital expenditure in HY1/FY12 add up to

Rs.240 Cr mainly in the following areas:

PNR Plant Rs.42 Cr

LCV (Sunrise) project Rs.31 CrNeptune Engine Rs.6 Cr

IT infrastructure Rs.23 Cr

Plant / Other projects Rs.138 Cr

Full year capex plan for FY12 to be containedwithin Rs.600 Cr.



23/50

Investments


DescriptionHY1

FY11-12

Nissan Joint Venture (Sunrise) 21

John Deere & Alteams 9

Hinduja Leyland Finance 60

Defiance 15

Others 35

Total 140 FY12 investments to be contained within Rs. 500 Cr in FY12.

Rs. Cr


24/50

Working CapitalRs. Cr.


Tighter control on vehicle inventory exists (413 Nos. increase over Mar 11) Vehicle stock as on 30thSep11 is 8659 nos. Receivables has come down by Rs. 187 Cr over Mar 11 Target to bring down working capital to around Rs.1000 Cr by Mar12

Production inventory 1079 1304 1066Finished inventory

Vehicles/Engines 809 778 743

Finished Parts 147 127 130

Finshed inventory - Total 957 905 873

INVENTORY 2035 2209 1940DEBTORS 887 1074 801Loans & Advances

Capital 68 28 63

Others 1061 748 1029

Total Loans & Advances 1129 776 1092

CURRENT ASSETS 4051 4059 3832CREDITORS 2542 3095 2306

WORKING CAPITAL 1509 964 1527

Particulars Sep-11 Mar-11 Sep-10


25/50

Funding plans

Borrowed ECB loans US $ 75 Mn (Rs. 350 Cr) at below5% p.a. Average cost of total debt: around 6% p.a.

Total loan outstanding at Rs. 2800 Cr as of Sep 11 with1.2:1 gearing.

Likely level of spend in 2011-12 towards:

Capex Rs.600 Cr (PNR, LCV, NGC, Nepture, R&D, etc.)

Investment in JVs Rs.500 Cr (Nissan, JD, ALTEAMS, HindujaLeyland Finance etc. Hinduja Foundries, etc,)

Plan to contain total borrowings within Rs.750 Cr in FY 12.

Debt /Equity levels not likely to cross 1:1 by Mar12Sufficient headroom available for debt infusion.



26/50

Ashok Leylands Strategies/Plans



27/50

Engine Platform Neptune Series

The NEPTUNE engine range

A new family of 4 and 6 cylinder inline enginesranging from:

160 230 hp in 4 cylinder engines

270 380 hp in 6 cylinder engines

Of modular capacity from 4.7 litre to 8 litre BS3and BS4 / Euro IV compliant and protected forEuro-V, with cooled EGR and SCR options

Quieter, stronger and more reliable by design, with

higher power and torque and better fuel efficiencyAlso benchmarked for lowest operating andmaintenance costs



28/50

Engine Platform H Series

Turbocharged intercooled H SeriesBS 3 Diesel engine (160 HP inline)

Turbocharged intercooled H SeriesBS 3 Common Rail engine (ensureshigher fuel efficiency)

Turbocharged intercooled H SeriesBS 3 Diesel engine (180 HP rotary)



29/50

Pant Nagar production & sales


Production from Pant Nagar has increased over the quarters Presently it is contributing over 30% of companys production / sales It is targeted to produce around 36% of the total volumes from Pant

Nagar in II half / FY12 (32000 vehicles in FY12)

Q2/FY'12 Q1/FY'12 Q2/FY'11 Q1/FY'11 FY'11

Total Production 21437 21969 25571 22090 95337

PNR Production 6801 5878 1698 786 12865

% of PNR Prodn 31.7% 26.8% 6.6% 3.6% 13.5%

Total Sales 23659 19277 24589 21400 94106

PNR vehicles - sale 8090 4893 1533 643 10878% of sales from PNR 34.2% 25.4% 6.2% 3.0% 11.6%


30/50

50% growth in network in 2 years

30 touch points added in Apr-Oct11 (55 nos. in 2010-11). Out ofthese more than 75% have been added in regions other than South

ALs network in North India will match the network in Southern Indiain next few months

AL is presently having equal presence of touch points across India

50% of customer touch points are less than 5 years old



31/50

Network growth


VehicleVolumes

TouchPo

ints

36323 5092084000 100000

170178 205

252

316 316

365

474

146 138

160

222

0

100

200

300

400

500

600

700

800

900

0

50000

100000

150000

08-09 09-10 10-11 11-12

AL Sal Vol No of outlets Dealer + ASC


32/50

Customer Care: Raising the bar

The national helplinecomes with the promise of

Response within4 hoursanywhere on the Golden QuadrilateralRestoration (vehicle back on road) in48 hours;If not restored, AL will pay Rs.1000/day of delay

TatkaAL rolled out along GQ in 2ndJan 10 & well received by customers.



33/50

Hinduja Leyland Finance

Operations have spread to 394 locations withmanpower strength over 850 nos.

Disbursements till 30thSep 11 is Rs. 950 Cr

(FY 11 > Rs. 1000 Cr)Equity capital of Rs 325 Cr. - contribution by AL& other group companies.(ALs share Rs.129 Cr)

Financed >2150 ALL vehicles in HY 1 FY 12

(7.7%). Corresponding disbursementsRs.400 Cr.



34/50

Alwar bus body building facility

Alwar: New bus body building facility put up

with globally bench-marked processes andmachinery Capacity: 1800 buses; InvestmentRs. 20 Cr.

High-end ULE buses roll out from Alwar Unit for

supply to Northern STUs

Shift this along with RAK slide for global busstrategy

Capacity to increase by two fold to 5400 buses p.a. in next 1 Yr (Cost Rs. 75 Cr.)



35/50

IRIZAR TVS

JV between AL, TVS & Sons & Irizar of Spain

State of art coach building facility at Viralimalai (nearTrichy) with an investment of Rs. 30 Cr.

Has built up area of 2 lakh Sq. Ft.Has three production lines & seven paint booths

Assembly and sub assembly under one roof

Capacity to produce 2200 coaches a year

IT 09, the indigenously designed luxury coach forintercity transportation by Irizar TVS recentlyunveiled



36/50

Bus Plant at Ras Al Khaimah

A vital manufacturing facility to feed GCC and African

markets. (Amount invested Rs. 110 Cr)Production has already begun. 470 buses have beenassembled during AprSep 11. Plan to assemble 750 nos.in HY 2.

Has the capacity to produce 2,000 buses annually

Eventually to produce trucks tooPart of ALs global Bus and Coach strategy



37/50

Investment in Optare UK

Subscribed for a 26%

stake in Optare Plc UK(US$ 7.5 Mln).

Pioneer of low floor doubledecker in UK.

Optare known for its lowcarbon range, low floor,

mid buses and modernrange of city buses.

Optares electric bus hassecured several orders asmore countries in Europe

promote cleaner, greenermobility.

Acquisition part of GlobalBus and Coach Strategy.



38/50

Volumes and Margin outlook


39/50

Outlook on volumes

Including Exports of 13000 vehicles and LCV sales AL is likely to cross 1 lac salesvolume in FY12 [excluding LCV (Sunrise) Volumes]

AL is well positioned to improve its market share as capacity will not be a constraint. Capacity addition in Uttarkhand will be sufficient to take care of next 2 years

requirements.


Actual Estimate

HY 1 FY HY 1 Full Year FYBUS

TIV 22,717 49,000 24,852 47,553 3.0%

ALL 9,096 22,000 9,619 20,425 7.7%

ALL MS % 40.0 44.9 38.7 43.0

TRUCK

TIV 137,818 299,000 126,518 275,235 8.6%ALL 27,824 64,000 31,715 62,674 2.1%

ALL MS % 20.2 21.4 25.1 22.8

TOTAL

TIV 160,535 348,000 151,370 322,788 7.8%

ALL 36,920 86,000 41,334 83,099 3.5%

ALL MS % 23.0 24.7 27.3 25.7

YoY %

2011-12

Actual

2010-11

C di i


40/50

Commodity price movements

Commodity prices softened during first half Expect pressure for price increase to suppliers to subside during second half


PeriodCopper

$ per TonRubberRs. /Kg

Zinc$ per Ton

Nickel$ per Ton

Alumnium$ per Ton

Steel HRRs./Kg

Mar'11 9543 220 2371 26827 2370 39.75

Apr'11 9507 239 2389 26339 2399 39.50

May'11 8945 225 2180 24213 2386 38.10

Jun'11 9056 222 2251 22382 2349 38.10

Jul'11 9639 212 2418 23763 2324 38.10Aug'11 9061 205 2239 22093 2288 37.60

Sep'11 8335 215 2100 20422 2274 38.50

% Increase (Q-o-Q, HY-o-HY)

Q 1 FY 12 (5.1) 0.9 (5.1) (16.6) (0.9) (4.2)

Q 2 FY 12 (8.0) (3.2) (6.7) (8.8) (3.2) 1.0HY 1 FY 12 (12.7) (2.3) (11.4) (23.9) (4.1) (3.1)

M i O l k


41/50

Margin Outlook

Targeting to maintain / improve operating

margins around 10.5% for FY 12 to besupported by:

Pricing action (3.8%), 2.5% taken in Apr11,

0.7% taken in Jul11 & another 0.6% taken

in Nov11

Commodity based price increase pressure(mainly steel and rubber) to be contained

Stringent controls on operating cost /working capital levels

Full year margin targeted around 10.5% of revenue



42/50

Joint Ventures


43/50

Construction equipment JV with John


44/50

Construction equipment JV with JohnDeere

New company formed with 50:50 partnership with John

DeereCommercial launch of backhoe loaders is planned inNov 11.

AL would supply engines for these equipments.

Around 500 Back hoe loaders planned for sale in FY 12.Next few years to scale up volumes to > 8500 Nos.

Targets to achieve 15% market share by 2015.

Total Project cost is Rs.401 Cr

Capex incurred till date Rs.140 CrAL investment in this JV as of date

is Rs. 51 Cr.


J i t t ith ALTEAMS


45/50

Joint venture with ALTEAMS

Plant inaugurated in January 2010

Fully established to meet both Telecom andautomobile sector requirements

Supplying Gear box casing, case oil coolers &connection housings to AL (meets 65% of ALs

requirements) .High Pressure Die Casting Technology ensuressavings in material consumption by >10%

Future supplies to include cylinder head

cover & inlet manifoldSecured LOI from other Auto OEMs

Total Project cost is Rs.161 Cr

Investment by AL is Rs.35 Cr



46/50

V l C ti U id t ti l


47/50

Value Creation - Upside potential

Better operating leverage thanks to increasing

demand for higher tonnage vehicles. Capacity nota constraint

Better utilisation of Pant Nagar facility resulting inhigher profits

Better capacity utilisation consequent to productionof LCVs for Nissan JV

Export volume to improve due to availability of

higher HP engines

trucks with factory built cabin

Buses featuring latest design/technology

Benefits expected to flow from JVs in near future



48/50

M&HCVLCVs Construction

equipment

Foundry Engines & Components Business

Auto Electronics Exhaust SystemTechnology

Engineering and Testing Services

Defence

Automotive Sector

Wider presence in Automobile SectorAL / CFO / IR / Nov11

Ashok Leyland shareholding pattern
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49/50

Ashok Leyland shareholding pattern(as on 30th Sep, 2011)

HindujaAutomotive Ltd

50.98%

Residents10.76%

Fis, InsuranceCo, State Govt,

GovtCompanies

12.99%

FIIs16.18%

Banks & MFs2.41%

Body corporate& others

6.68%



50/50

Thank You

Documents

CFO Investors Meet Nov 2011