Cummins India Limited · NSE:CUMMINSIND
Cummins India — Shareholder Meeting (August 2015)
38 slides from Cummins India's shareholder meeting presentation, Aug 6, 2015
Slide 1: Cummins India Limited 54th Annual General Meeting
Cummins India Limited 54th Annual General Meeting Anant J. Talaulicar August 6, 2015
Slide 2: Cummins Inc.
Cummins Inc. Engine Business Distribution Business Power Generation Business Components Group 1919 - Commenced in Cummins Operations in 190 Countries Columbus, Indiana Business Services 90 manufacturing locations 54,600 employees 600 distributor locations Capex and R&D: $1.5B 7,200 dealer locations
Slide 3: Cummins Business Model
Cummins Business Model Guiding Principles - Vision, Mission, Core Values Cummins Operating System (COS): – Ten Common Practices – Functional Excellence Framework (FE Statements, Measures, Processes, Tools, People Development) – Common Business Processes (Strategy, Performance Management/People D
Slide 4: Why We Are Here – Guiding Principles
Why We Are Here – Guiding Principles Vision: “Making people’s lives better by unleashing the Power of Cummins” Personality: Decisive Driven To Win Agile Passionate Caring Core Values: Mission: Integrity Motivating people to act like owners working together Innovation Exceeding cust
Slide 5: COS 10 Practices
COS 10 Practices Put the Synchronize Design quality in Involve people Ensure equipment customer first, flows (material, every step of and promote and tools are and provide physical and the process teamwork available and real value information) capable Create Establish the Treat preferred Follow comm
Slide 6: Cummins Inc. - Goal Tree 2015
Cummins Inc.- Goal Tree 2015 Common Critical Initiatives Become Excellent in Customer Support Strategies Objectives Develop a Growth Mindset Leverage Achieve Complementary Move from Multinational to Global Finance Businesses Targets Achieve Supply Chain Excellence Over the Increase Shareholder Meet
Slide 7: External Environment – Challenging
External Environment – Challenging GDP Growth Rates – Key Economies 9.2% 8.5% 7.8% 7.7% 7.4% 6.9% 7.3% 6.5% 6.8% 5.1% 4.3% 3.4% 2.7% 2.7% 2.4% 2.5% 1.7%1.4% 2.2% 1.8% 1.2% 0.9% 1.3% 1.4% 0.6% 0.1% 0.1% -0.6% 2011 2012 2013 2014 2015 (F) -1.0% -3.4% USA EU Brazil Russia China India Source: IMF projec
Slide 8: Financial Performance – Last Years
Financial Performance – Last 5 Years Sales EBIT1 $3,000 $22,500 Sales $2,750 $2,556 $20,000 $19,221 $18,048 $2,500 $2,349 $17,334 $17,301 $17,500 $2,250 $2,1 $15,000 $2,000 $13,226 $Millions $1,657 $Millions $1,750 $12,500 $1,500 $10,000 $1,250 $7,500 $1,000 $750 $5,000 $500 $2,500 $250 $0 $0 2010 2
Slide 9: Cummins in India
Cummins Turbo Cummins in India Technologies Fleetguard Filters Valvoline • In India since 1962 Rudrapur Cummins • 8 companies (including 3 JVs and 1 Service JV) Cummins SVAM Tata Cummins • Over 9,000 employees NCR Fleetguard Filters • INR 93B combined sales Jamshedpur Cummins Turbo Technologies Engi
Slide 10: India Organization Snapshot
India Organization Snapshot Cummins in India Entities : Business Units : 1. Cummins India Ltd. Engine Automotive 2. Cummins Research & Technology India Pvt. Industrial Ltd. Parts & ReCon 3. Cummins Generator Technologies India Pvt. Power Generation Ltd. • Generators 4. Cummins Technologies
Slide 11: Strategic Leadership Team
Strategic Leadership Team Anant Talaulicar Chairman and Managing Director – India ABO Sandeep Sinha Rajiv Batra Sudha Dhar Ashish Alpana Vikas Thapa Qureish Venkat Chief Operating Finance & Chief Aggarwal Gupta Human Shipchandler Ramana Officer Facilities Information Government Strategy & Resources
Slide 12: Operating Leadership Team
Operating Leadership Team Sandeep Sinha Chief Operating Officer – India ABO Ashwath Ram Bhavana Bindra Amit Kumar Vipul Tandon Milind Madani Anjali Pandey Industrial Engine Business & Automotive Power Generation Distribution New & ReCon Cummins Turbo Tata Cummins Operations Business Business Busines
Slide 13: Goal Tree 2015
Goal Tree 2015 Common Critical Initiatives Adopt a growth mindset and offer FFM Strategies products Objectives Grow/Maintain Domestic Meet Financial Targets and Manage Achieve Market Share Costs Financial Targets Advance from Multinational to Global Become a Low Cost Producer Achieve Supply Chain Ex
Slide 14: Cummins India Limited – Year 2014-15
Cummins India Limited – Year 2014-15 Sales and profits – Net Sales : INR 4,321 crores – PBT : INR 937 crores (21.7% PBT) Strong balance sheet Dividend at 700% (last year : 650%) Investments for growth – New Products – Global Technical Center – Training Center at Megasite
Slide 15: Cummins India Limited - Financial Performance
Cummins India Limited - Financial Performance 2014-15 * Other Income includes gain on sale of KPIT shares of ₹ 83 crores
Slide 16: Sales and Profit After Tax (PAT) – Last 5 years
Cummins India Limited - Sales and Profit After Tax (PAT) – Last 5 years Sales PAT Rs Crores Rs Crores 16 * Profits of FY 12-13 & 14-15 includes gain on sale of KPIT shares of ₹ 62 Crores & ₹ 83 Crores respectively
Slide 17: Sales: Domestic & Exports
Cummins India Limited - Sales: Domestic & Exports Rs Crores
Slide 18: Strong ROE Performance
Cummins India Limited - Strong ROE Performance 35% 33% 32% 30% 29% 27% 25% 23% 20% 15% 10% 5% 0% 10-11 11-12 12-13 13-14 14-15
Slide 19: Dividend Trend
Dividend Trend FY 14-15 • 250% Interim Dividend • 450% Proposed Final Dividend
Slide 20: Share Price Appreciation
Cummins India Limited - Share Price Appreciation * As on 3rd August 2015 on BSE Sensex Share prices upto Mar’11 have been adjusted to bonus issue
Slide 21: Shareholder Return (Last 5 Years)
Cummins India Limited - Shareholder Return (Last 5 Years) Mar -11 Mar -12* * * Mar – 13* * Mar – 14* Mar - 15 11% -10% 8% 19% 18% 36% 4% 2% 23% 49% * Shareholder return computed as a % change in the share price (adjusted for bonus) and dividend payout Source : BSE India website
Slide 22: Cummins India Limited – Strongly Positioned
Cummins India Limited – Strongly Positioned Strong balance sheet – Debt to capital Zero Debt – Cash & Equivalents Rs. 545 Cr Grew the business despite economic slowdown – Sales growth (5 Yrs CAGR) 2% Returned value to shareholders – Return on equity (5 Yrs) 22% – Share appreciation (5 Yrs) 19%
Slide 23: Dependable Products & Technologies
Dependable Products & Technologies New Products – Indigenized ‘fit-for-market’ series of the QSK50 generator for the 1750 kVA to 1975 kVA segment – 42 prime power and 15 stand-by ratings across 17 engine platforms complying with CPCB II norms – Q60 engine for a commercial marine main propulsion ap
Slide 24: Dependable Services
Dependable Services Driving Customer Support Excellence (CSE) – Customer Focused Six Sigma Projects : 112 – Common Dealer Operating System – Augmented service engineer capacity across India Net Promoter Score has increased to 70% in 2014-15 from 65% in 2013-14
Slide 25: Dependable Processes
Dependable Processes Six Sigma : 706 projects completed, generating savings of INR 147 crores AMaZe (Accelerated Move towards Zero-defects): Strengthening quality in five areas; Design Quality, Supplier Quality, Plant Quality, Product Quality & Reliability, and Service Quality. ACE (Accelerate
Slide 26: Great Place To Work
Great Place To Work Leadership Excellence Cummins Performance Operating Ethic – System CPMS/IDP/ODR Corporate Diversity & Responsibility Great Place Inclusion to Work Recruitment Employee and Engagement Onboarding Survey & Actions Compensation, Employee Benefits & Recognition Communication
Slide 27: Employee Engagement Model
Employee Engagement Model Career Opportunities for Growth Good Meaningful Manager Work Work-Life Recognition Balance & Rewards Work Learning & Environment Development and Culture Senior Leadership
Slide 28: Fostering the Right Environment
Fostering the Right Environment “Cummins is committed to fostering a physically and psychologically safe, integrity based, respectful, inclusive, high performance culture that breaks down hierarchies and organizational boundaries, and engaging the full talents of our diverse employees to delight all
Slide 29: Dependable People
Dependable People Building the Right Environment – Leadership Development • Five critical skills • Leadership Conversation sessions • Partnerships for Sponsored Education (Kelley School of Business, S.P. Jain, IIM-A, ARAI- VIT). Added MTech program with specialization in Electronics • Six Sigma :
Slide 30: Dependable People
Dependable People Building the Right Environment – Updated Ethics training module - Right Environment Every Time (REET) – Fully functional and effective Ethics Committee – An Internal Complaints Committee – Growth Opportunities • Technical Salary grade structure and global payroll solution, ‘OnePa
Slide 31: Corporate Responsibility – Increased Commitment
Corporate Responsibility – Increased Commitment Local Infrastructure and Social Higher Education Energy And Environment Justice Women Education Renewable Energy Rural Development Projects and Employability Education Assistance Indoor Air Pollution NGO Development to Socially and Economically Weaker
Slide 32: Dependable People
Dependable People Strengthening Our Communities : – Sustainable projects • Cummins Scholarship Program : 125 • Cummins College of Engineering for Women • Catch them Young : 80 cities and more than 4L students • Seven more villages selected to replicate the success and learnings from Nandal Model V
Slide 33: Milestones & Recognition
Milestones & Recognition Environment & Safety : – Achieved 15 percent reduction in greenhouse gases, 20 percent reduction in water consumption and 43 percent reduction in total waste disposal – All the plants comply with the Occupational Health and Safety Assessment Series (OHSAS) 18001 Standard a
Slide 34: Financial Performance Q1 15-16 vs Q1 14-15
Financial Performance Q1 15-16 vs Q1 14-15
Slide 35: Financial Performance Q1 15-16 vs Q4 14-15
Financial Performance Q1 15-16 vs Q4 14-15
Slide 36: Sales by Business Unit
Cummins India Limited – Sales by Business Unit * Total sales are net of intercompany eliminations.
Slide 37: Macro Trends and Our Capabilities Will Drive Profitable Growth
Macro Trends and Our Capabilities Will Drive Profitable Growth Macro Trends Key Capabilities Growing Middle Class Technology Leadership Consumption Local Manufacturing Environmental Regulations Strong Partnerships Infrastructure Development Diverse Talent & Leadership Energy Conservation Strong Cust
Slide 38: Outlook and Conclusion
Outlook and Conclusion Well positioned to leverage the economic revival We remain steadfast on : – Guiding Principles (Vision, Mission, Values, Personality) – Cummins Operating System – Objectives, strategies, initiatives – Inclusiveness based performance ethic – Brand Promise of Dependability