Hcl Infosystems Limited · NSE:HCL_INSYS
Hcl Infosystems — Investor Day (September 2011)
44 slides from Hcl Infosystems's investor day presentation, Sep 9, 2011
Slide 1: Annual Analyst & Investor Meet FY11
Annual Analyst & Investor Meet FY11 Sep 9th - 2011
Slide 2: Disclaimer
Disclaimer This may contain "forward-looking" information including statements concerning the HCL's outlook for the future, as well as other statements of beliefs, future plans and strategies or anticipated events, and similar expressions concerning matters that are not historical facts. The forward
Slide 3: Today's Agenda
Today's Agenda Introductory Remarks Ajai Chowdhry, Chairman 3:45 PM – 3:50PM Business overview Harsh Chitale Chitale, CEO 3:50 PM – 4:15PM Growth Strategy Rothin Bhattacharya 4:15 PM – 4:30PM Update LOB Update: Harsh Chitale, CEO 4:30 PM – 5:45PM – Computing Business – Telecom & Office Automation Fi
Slide 4: Strengthened Management Team
Strengthened Management Team CEO Computing Business Telecom and Office Automation Distribution Office Enterprise E t i Consumer C & A t Automation ti HCL Care HCL Learning Business Unit Computing Marketing & Services Security Sales – APS Bedi Princy Gautam Anand Sanjay M Chandrasekaran Ops – Rajeev
Slide 5: New Management –Profiles
New Management –Profiles Rothin Bhattacharya Over 24 years of business management experience, considered a thought leader in technology & services sector Head Has held important appointments with industry leaders like Reliance, Siemens and KPMG Marketing, Strategy, Bu Member of the “National S
Slide 6: Today's Agenda
Today's Agenda Introductory Remarks Ajai Chowdhry, Chairman 3:45 PM – 3:50PM Business overview Harsh Chitale Chitale, CEO 3:50 PM – 4:15PM Growth Strategy Rothin Bhattacharya 4:15 PM – 4:30PM Update LOB Update: Harsh Chitale, CEO 4:30 PM – 5:45PM – Computing Business – Telecom & Office Automation Fi
Slide 7: Year Gone By – FY 11
Year Gone By – FY 11 Challenges/ Concerns Steps Taken Systems Integration business Shift in vertical focus continued to be severely impacted Addition of Credit controller d tto d due delay l iin customer t S Segregation ti off Project P j t Management M t Office Offi (PMO) acceptances leadin
Slide 8: Highlights
Highlights Recently added businesses like Digischool in HCL Learning performing well. Successful presence in new growth areas such as remote services and emerging markets in Middle East and Africa. Traditional businesses have performed well - Computing Hardware & related services (within EBU)
Slide 9: Business Portfolio & Offerings
Business Portfolio & Offerings Distribution Enterprise Office Business HCL Consumer & B i Business HCL C Care A t Automation ti Unit Learning Computing Marketing Unit & Security Services Desktops 3rd party Projectors IT Products Remote Digischool Laptops Telecom Imaging Offerings IT Services support
Slide 10: Strategic Levers
Strategic Levers Operational Excellence program around key levers like Efficienc Efficiency Working capital capital, Cost productivity productivity, service excellence etc etc. + Rebalance portfolio to move from low margin hardware & Business Mix distribution business to high margin services & learn
Slide 11: Business Excellence Program – Aspire
Business Excellence Program – Aspire Excellence Tracks S l Excellence Sales E ll Service Excellence Project Delivery Excellence Consistent Cost Productivity Growth in Distribution Excellence C h & EPS Cash Operations Excellence Innovation Excellence Growth Drivers PROCESS & SYSTEM ENABLER PEOPLE ENA
Slide 12: Aspire – Business Excellence Program
Aspire – Business Excellence Program Charter Focus Areas Sales • Strong Account Management program; Early Wins Excellence • Competencies through sales certifications g g of backend p • Strengthening processes H2 FCF** at Rs. 109 cr ((v/s H1 at Service • Customer delight (-) Rs. 228 cr) Excellence
Slide 13: People & Process Enablers
People & Process Enablers People & Process Enablers Details Building a talent pool and performance driven New talent additions within BUs and Functions culture New Performance Management System New Rewards and Incentives structure New Talent Review Process Re-aligned Organization Focus
Slide 14: Shift Towards High Margin Business
Shift Towards High Margin Business Revenues ‐ FY 11 Revenue Mix Revenues ‐ FY 14 5% 9% Lifecycle services & 10% Learning Lifecycle services & 11% Learning OA, SI & SO OA, SI & SO Distribution, Products Distribution, Products 85% 80% GM ‐ FY 11 Gross Margin Mix GM ‐ FY 14 23% Lifecycle services & Lif
Slide 15: Today's Agenda
Today's Agenda Introductory Remarks Ajai Chowdhry, Chairman 3:45 PM – 3:50PM Business overview Harsh Chitale Chitale, CEO 3:50 PM – 4:15PM Growth Strategy Rothin Bhattacharya 4:15 PM – 4:30PM Update LOB Update: Harsh Chitale, CEO 4:30 PM – 5:45PM – Computing Business – Telecom & Office Automation Fi
Slide 16: Business Outlook – Short & Medium Term
Business Outlook – Short & Medium Term Macroeconomic Indicators look Sluggish but… Medium Term Business Outlook remains positive GDP Growth Education sector gaining growth momentum with GDP growth expected to be moderate in FY 12; Q1 FY 12 – 7.7% compared to 8.8% a year ago increased government
Slide 17: Growth Drivers
Growth Drivers HCL Growth Engines Horizon 1 Horizon 2 Horizon 3 Mature Rapidly Growing Emerging Business Business y Lifecycle Services Scalable Learning g Cloud Computing p g for Consumers & Solutions Private Cloud & Enterprise Hosted apps for SMB Multi Brand Other Emerging Mobility Solutions Distri
Slide 18: Growth Drivers – Horizon 1
Growth Drivers – Horizon 1 Life Cycle Services Multibrand Distribution Market Overview Market Overview Market Size Market Size In various categories • Consumer & SMB PC support(India)- Rs. 2500 – • Mobiles – Rs. 32000 cr 3000 Cr • TV/LCD – Rs. 10000 cr • Enterprise IT support (India) – Rs. 5000 Cr •
Slide 19: Growth Drivers – Horizon 1
Growth Drivers – Horizon 1 Strategic & Transaction outsourcing Market Overview Market size : Rs. 10000 cr Deal Type Transactional : Rs. 5000 cr Active / Std : Rs. 3000 cr Outsourced : Rs. 2000 cr Industry Trends • Govt projects moving to the transaction based model • Outsourced deals are increasingg
Slide 20: Growth Drivers – Horizon 2
Growth Drivers – Horizon 2 Learning - Digischool Other Emerging Markets Market Overview Market Overview • Installed base of Total Interactive Classrooms – • IT Market Size 54000 Middle East : $15 Bn • Total Addressable market – 1.4 M Classrooms South Africa : $10 Bn • Class rooms added every year –
Slide 21: Growth Drivers – Horizon 3
Growth Drivers – Horizon 3 Cloud Computing Mobility Solutions Market Overview Market Overview • Market Size Currently market under Rs. 500 Cr • Tablet market size in India • Cloud computing market in India to reach 0.3 M - 0.4 M in FY 2011-2012 Rs. 4500 Cr by 2015 • 70 Mn tablets to be shipped in 20
Slide 22: Enabling Growth
Enabling Growth Marketing New Product Introduction (NPI) Process Customer Centric offerings Strategic Media Planning Product Life Cycle Planning Internet marketing Investing in 3 R & D Centres at Jaipur Jaipur, Chennai & Noida COE for Complex Database oriented S/W solutions COE for
Slide 23: Today's Agenda
Today's Agenda Introductory Remarks Ajai Chowdhry, Chairman 3:45 PM – 3:50PM Business overview Harsh Chitale Chitale, CEO 3:50 PM – 4:15PM Growth Strategy Rothin Bhattacharya 4:15 PM – 4:30PM Update LOB Update: Harsh Chitale, CEO 4:30 PM – 5:45PM – Computing Business – Telecom T l & Office Offi Auto
Slide 24: Computing Business
Computing Business FAC £..
Slide 25: Enterprise Business Unit
Enterprise Business Unit Strategy Business Descriptors Increase channel reach and presence 5000+ Customers supported by 700 strong sales Team Grow in transactions & Strategic 120 strong, SMB Team 370 Partners Outsourcing (SO) 7000 + field force for Infrastructure services (FM, AMC, RIM)
Slide 26: System Integration - Update
System Integration - Update Our Systems Integration business continued to see delays in projects in the verticals where we have a significant presence Delayy in release of payments p y by y our customers resulting g in increased borrowing costs, provisions on account of receivables due to de
Slide 27: System Integration Order Book
System Integration Order Book Total Order Book as at 1st July 2011 Rs. 4250 crores Project j Based Tranx Based Rs. 1100 Cr Rs. 2300 Cr APO* / LOI* : Rs. 850 (Revenue estimated (Revenue estimated crores Rs. 350 Cr in FY 12) Rs. 100 Cr in FY 12) *APO – Advanced Purchase Order * LOI – Letter of Intent
Slide 28: Vertical Wise Order Book
Vertical Wise Order Book 38 26 310 310 23 738 735 30 290 252 366 471 455 430 33 1,720 1,694 1,724 222 1 613 1,613 400 302 1,028 990 1,164 1,119 1,094 1st July'10 1st Oct'10 1st Jan'11 1st April'11 1st July'11 Telecom e-Gov Power BFSI & Co-op Defence Other Verticals In Rs Crores
Slide 29: Consumer Computing
Consumer Computing Strategy Business Descriptors High attach of services with PC & Offerings in Desktop, Laptop, Net books, Tablets notebook sales. sales Growing portfolio of consumer services & accessories Channel de-layering, Direct to Retail Financial Indicators Increase desktop penetra
Slide 30: HCL Care
HCL Care Strategy Business Descriptors Field Services for HCL Products Nation wide Services for consumers & SMB Network of Bring in Maintenance centers (BIM) Third party ICT repair and a back end repair factory Authorized Service Partners Multibrand Mobile phone Repair Centralised Call
Slide 31: HCL Learning - K-12 Offerings
HCL Learning - K- 12 Offerings STUDENTS -Test Prep and career counseling -K12 content on Dongle and Tablet - English Language Labs Teachers - Computer Training - Teacher Training videos with Digischool g content - Web 3.0 portal Digi-School Campus Model: Multimedia in Classrooms SCHOOLS -ERP solutio
Slide 32: HCL Learning
HCL Learning Strategy Business Descriptors Significant Digischool growth in classrooms signups 3100 classrooms signed up for Digischool solution last year Test Prep Offering - Xcelerate 1 million students learning using Digischool Test prep offering in 25 schools Language Lab and School
Slide 33: Telecom & Office Automation
Telecom & Office Automation FAC £..
Slide 34: Continuing Relationship with Nokia
Continuing Relationship with Nokia 3 Year agreement signed on Aug 12th 2011 Key Terms of the Agreement Share of business consistent with the current share Agreement extended till December 31st 2014 Business looking up after Launch of Nokia Dual Sim May-August Vs Jan April , Growth is up
Slide 35: HCL Group Distribution Portfolio
HCL Group Distribution Portfolio HCL Infosystems India formerly
Slide 36: Targeting the Right Categories for the Right channels
Targeting the Right Categories for the Right channels CURRENT BUSINESS MP3 BUSINESS OPPORTUNITY EDUTAINMENT ACCESSORY:MOBILE++ GOOD PBT OPPORTUNITY PRINTER CONSUMABLES DIGITAL IMAGING MEM CARDS/USB PRINTERS WASHING MACHINE LIGHTING‐ ORG. AC MOB. 2ND HAND REFURB. FRIGE PC SMALL APPLIANCES TV LCD MOBI
Slide 37: Distribution & Marketing Services
Distribution & Marketing Services Strategy Business Descriptors Reach to ~100,000 retail outlets Arms length g subsidiaryy (operational ( p 2800 Organized Trade outlets across 22 Chains on 1st Aug) to manage Competing 28 warehouses with efficient logistics & support Lines Micro-management
Slide 38: Office Automation
Office Automation Strategy Business Descriptors Transition from p products to Robust Office Automation (OA) channel solutions & services Wide range of products across - Managed Print services Printers, Projectors, AVSI and Video conferencing. AVSI Securityy & Tracking g solutions Financi
Slide 39: Today's Agenda
Today's Agenda Introductory Remarks Ajai Chowdhry, Chairman 3:45 PM – 3:50PM Business overview Harsh Chitale Chitale, CEO 3:50 PM – 4:15PM Growth Strategy Rothin Bhattacharya 4:15 PM – 4:30PM Update LOB Update: Harsh Chitale, CEO 4:30 PM – 5:45PM – Computing Business – Telecom & Office Automation Fi
Slide 40: Results Highlights
Results Highlights Consolidated Revenues 12159 • Systems Integration business 98 11542 continued to be severely (230) 443 impacted due to delay in customer acceptances, delay in (928) release of orders impacting the Rs. crores revenues from this business down 5% Y-o-Y • Telecom Distribution was impa
Slide 41: Results Highlights
Results Highlights Consolidated PBT • Systems Integration: Delay in customer decision / acceptances 346 has resulted in cost overruns, receivables provisioning 4 230 5 and increase in cost of (105) borrowings to finance the working (20) ores capital needs. Rs. cro down 34% Y-o-Y • Telecom Distributi
Slide 42: Business Mix
Business Mix Computer Systems Business Mix Systems Integration Systems Integration Computing 17% Computing 23% Business Business 73% 75% Learning Learning 2% 1% Overseas Overseas Operations Operations 8% 1% FY 11: Rs. 3691 crores FY 10: Rs. 3643 crores Telecommunication & Office Automation Business
Slide 43: Consolidated Balance Sheet
Consolidated Balance Sheet Rs. crores Consolidated As at June 30, Particulars 2011 2010 FY 11 highlights (Audited) (Audited) Shareholder's funds • Fixed Assets increased due to acquisitions Share Capital 45 44 made during the year and ERP upgrades. Share Warrant Application Money 18 Reserves and Sur
Slide 44: Today's Agenda
Today's Agenda Introductory Remarks Ajai Chowdhry, Chairman 3:45 PM – 3:50PM Business overview Harsh Chitale Chitale, CEO 3:50 PM – 4:15PM Growth Strategy Rothin Bhattacharya 4:15 PM – 4:30PM Update LOB Update: Harsh Chitale, CEO 4:30 PM – 5:45PM – Computing Business – Telecom & Office Automation Fi