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Investor Presentaiton

the regulatory push to meet the deadlines on phasing out the internal combustion engines. Improvement in component supplies, consumer demand and new launches helped the Indian auto industry to improve volumes in financial year 2023. Industry had a good festive season with 2 million vehicles retailed in October, 2022, a nearly 50% growth over previous year. The industry reflected the overall trend in the economy where demand for the higher end of the product range is stronger than mass selling categories. Auto Industry was impacted by muted demand in its biggest export markets for 2 wheelers and 3 wheelers due to economic crisis in these markets. The overall Medium and Heavy Commercial Vehicle (M&HCV) production increased by about 35% over 2021-22. Haulage and tippers segment saw robust growth during the year. The bus segment grew by almost three times with public transport recovering post Covid. Many state transport undertakings (STU) added Electric buses into their fleet for mainly city operations. 2023-24 should be a good year for the category with all segments expected to grow. Increased commercial activities is expected to positively impact the tipper and haulage segment. The push towards higher axle load vehicles is likely to continue. The bus segment should also get the benefit of the vehicle scrappage policy that is to be implemented during the year. The industry will continue to work on initiatives to meet the various regulatory requirements expected to be implemented during the year. The passenger vehicle production has seen a growth of 25% in the year ended March, 2023 and the domestic car sales also recorded the highest ever sale in a financial year. The segment continued to witness preference for Sports Utility Vehicles (SUVs) and this is now the largest selling segment with a share of 52%. Despite price increases, a mix of improved chip supply, higher incomes and pent-up demand, especially for SUVS supported this sales. Though the supply bottlenecks have eased, there are still some challenges on components like semiconductor chips that are expected to continue for some more time. The waiting period for many car models have come down, with improvement in supply and inventory. From April 2023, the Phase 2 of the BS6 regulation and RDE (Real Drive Emission) requirements will come into effect which may impact the price of new vehicle. The shift to electric vehicle has intensified in 2022-23 with demand for EV coming from both big and small towns and also from rural areas. Two wheeler production has seen a revival in the current year with a growth of close to 12% after 3 consecutive years of decline. In motorcycles, the growth has been fueled by domestic sales. Exports have declined because of various internal issues in some of the key markets. Scooter continues to be more of a domestic phenomenon with negligible exports. Electric vehicles business especially in the scooter segment made significant gains during the year. The subsidies under the FAME 2 scheme of the Government continues to ensure that these vehicles are price competitive. Companies also seem to be investing in developing the charging infrastructure. We continue to be a preferred choice of fitment of Original Equipment Manufacturer ("OEMS") in most of the new launches. During the year, we have also further strengthened our after market portfolio with new products both in the motorcycle and scooter segment. Tractor production in financial year 2023 has shown a substantial increase of 11% and touched one million tractors for the first time. Various Government schemes and a better monsoon helped the tractor industry to register a robust growth during financial year 2023. Even though the IMD predicts a hotter climate during 2023-24, a healthy water reservoir level should ensure enough water for agriculture and good start to financial year 2024. Growth in the automobile industry and replacement demand enabled Tyre industry to show a healthy growth in financial year 2023. However, export performance was muted considering the slowdown in the world markets. Higher volumes and price hikes taken by the Industry helped to maintain margins for the industry in financial year 2023. Product wise Performance During fiscal 2022-23, your company achieved a total income of *22826 crores. There was an overall increase of 8% in tyre production in financial year 2023, with all product groups showing growth. In the Heavy Commercial Vehicle product group, there was an increase of 7% over the previous year while Light Commercial Vehicle Tyres increased by around 2%. Small Commercial Vehicle tyres increased by 14%. Passenger & SUV showed a growth of 13%. The Farm product group grew by 9%. The Motorcycle and Scooter product group increased by 2% and 16% respectively. The Off the Road ("OTR") product group grew by 11%. Exports Exports business for the year 2022-23 was muted due to unexpected headwinds seen in Indonesia & Bangladesh and a few countries of Africa. Although exports revenue grew by only 5% in 2022-23, there were substantial growth in a few strong markets. Export turnover for the year 2022-23 was *1866 crores as against 1779 crores in the previous year. Our key markets of Bangladesh and Indonesia saw unforseen headwinds which impacted the total revenue for the year. The unprecedented forex crisis 34
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