Varroc Engineering Limited · NSE:VARROC
Varroc Engineering — Q2 FY2024 Earnings Presentation
37 slides from Varroc Engineering's earnings presentation, Nov 8, 2023
Slide 1: Exchange filing cover letter
Varroc Engineering Limited Regd. & Corp. Office L‐4, MIDC, Industrial Area Tel + 91 240 6653700 email: [email protected] Waluj, Aurangabad 431 136, Fax + 91 240 2564540 www.varroc.com Maharashtra, India CIN: L28920MH1988PLC047335 VARROC/SE/INT/2023-24/91 November 7, 2023 To, The Manager- Listin
Slide 2: Press Release
Press Release Profit Before Tax grew by 141% YoY, Debt Reduced and Strong Order Win delivered by Varroc Engineering Limited • Consolidated revenue from operations was ₹18,868 million in Q2 FY24, registering a growth of 2.9% on YoY basis • Consolidated PBT margins in Q2 FY24 were at 3.9%, improved by
Slide 3: Press Release: About Varroc and Safe Harbor
Press Release other efforts like capacity utilization, prudent capital allocation and cost reduction across the board to make our business more robust.” About Varroc Engineering Ltd. Varroc Engineering Ltd is a global tier-1 automotive component group. It was incorporated in 1988. The group manufact
Slide 4: Financial Results Q2 FY24
Financial Results Q2 FY24 7th Nov 2023 1
Slide 5: Disclaimer
Disclaimer This presentation may include statements which may constitute forward-looking statements. All statements that address expectations or projections about the future, including, but not limited to, statements about the strategy for growth, business development, market position, expenditures,
Slide 6: Content
Content 1. Highlights 2. Industry Performance 3. Financials 4. New Business Win 5. Awards & CSR 6. Annexure: 1. About Varroc Engineering Confidential 3
Slide 7: Highlights Q2 FY24
Highlights Q2 FY24 1. Registered a YoY revenue growth of 2.9% with Revenue in Q2 FY24 at Rs. 18,868 million 2. Improving profitability on YoY basis EBITDA margin @ 9.9%, higher by 70 bps on YoY basis. Absolute EBITDA for Q2 FY24 is Rs. 1,871 million PBT margin of 3.9% higher by 220 basis point YOY.
Slide 8: Automotive Production in India
Automotive Production in India • Strong domestic macro factors resulted most of the segment to grow on YoY basis other than 2W segment. 2W is lagging due to early festive season last year • 2W de-grew by 1.5% • 3W grew by 19.6% • PV grew by 5.6% • CV grew by 8.8% • On QoQ basis, we saw growth in all
Slide 9: Consolidated Financials of Q2 FY24
Consolidated Financials of Q2 FY24 18868 Rs. In Million Q2 FY24 Q2 FY23 YoY Q1 FY24 QoQ 3.9% 3.6% Revenue 18,868 18,341 2.9% 18,057 4.5% 18341 EBITDA 1,871 1,681 11.3% 1,802 3.8% 1.7% 18057 EBITDA % 9.9% 9.2% 70 bps 10.0% (10 bps) Reported PBT 739 307 141.1% 652 13.3% PBT % 3.9% 1.7% 220 bps 3.6% 30
Slide 10: Consolidated Financials of H1 FY24
Consolidated Financials of H1 FY24 3.8% 36925 Rs. In Million H1 FY24 H1 FY23 YoY Revenue 36,925 34,693 6.4% EBITDA 3,672 3,028 21.3% Multiplier i.e. operating 34693 leverage at each level EBITDA % 9.9% 8.7% 120 bps 0.9% Reported PBT 1,392 303 359.3% PBT % 3.8% 0.9% 290 bps H1 FY23 H1 FY24 Revenue PB
Slide 11: Consolidated Financials of Continued Operations
Consolidated Financials of Continued Operations As on Divestment (6Th Rs. in Million 30 th Sptember’23 31 st March 2023 October 2022)^ Net Debt 10,064 12,779 ~ 13,000* Equity 10,658 10,042 8990 Annualised Adjusted EBITDA 7344 5986 6722 Net Debt/Equity 0.94 1.27 1.45 Net Debt/EBITDA 1.37 2.13 1.93 RO
Slide 12: Revenue Breakdown for H1 FY24
Revenue Breakdown for H1 FY24 Business Unit Segment Aftermarket, Others, 2.7% Others, 2.7% 8.9% PBU, 31.5% 4 Wheeler, 26.4% MBU, 12.0% Lighting, 21.5% 2&3 Wheeler, 70.9% EBU, 23.4% Geography Customer Outside India, 15.3% Bajaj, 40.7% Non-Bajaj, 59.3% India, 84.7% Confidential 6 Note: EBU is Electric
Slide 13: New Lifetime Order Win in H1 FY24
New Lifetime Order Win in H1 FY24 Lifetime Business win of Rs.36,023 Million Lifetime Revenue win from ICE & EV Players Start of Production Rs. In Million FY24 21,136 FY25 Onwards 14,887 EV, 31% 11,227 ICE, 69% 24,796 Lifetime Revenue win from Customers Lifetime Revenue win from 2&3W and 4W Players
Slide 14: Awards
AWARDS VEL-CK (L), Platinum Award VEL-II (Q & D Award) VEL-II, Gold Award VPL-IV, Silver Award VPL-CK, (Q & D Award) VPL-I, (EHS Award) VEL-PN (2nd Runner Up) EBU R&D (Elcina Award) EBU R&D (Elcina Award)
Slide 15: Varroc Corporate Presentation
VARROC CORPORATE PRESENTATION
Slide 16: Vision & Mission
Vision & Mission Vision Mission Create safe, smart and sustainable Be the trendsetter in delivering highest value for future mobility solutions for everyone. money mobility solutions • Extend India Market leader position in 2W mobility, lighting, and driver assistance to the world • Double profitabl
Slide 17: Values
Values Sincerity Humility Integrity Passion Self-Discipline To speak & act from To walk with everyone To do what is right To go distance against To make it all happen the heart all odds
Slide 18: About Us
About Us Varroc is a leading global auto technology company with a product portfolio covering a wide range of electrical, electronics, 08 7000+ Countries Employees lighting, polymer, metallic, after-market and advanced safety solutions 36 Operating Manufacturing Facilities REVENUE USD 842 MILLION BU
Slide 19: Our Journey
Varroc’s Transformation into a Our Journey Global Auto Technology Group 2022 2019 Signed SPA with Plastic Omnium to divest 4W Lighting Operations in EU & America 2017 Acquired 74% stake in CarIQ, a leading Telematics Began localized production of 2W EV components in India 2011 Acquired 90% stake in
Slide 20: Our Global Footprint
Our Global Footprint Timisoara Targu Mures Changzhou (VTYC) Krakow Romania Chongqing (VTYC) Poland China Dortmund Germany Cambiano Tokyo Sumirago Japan Italy EUROPE ASIA Romania India Poland China Hanoi Vietnam Italy 08 7000+ Vietnam Germany Japan COUNTRIES EMPLOYEES Czech Republic Aurangabad Pune S
Slide 21: Global Business
Global Business With diversified product lines Business Division - Global 4W Business Division - India Electronics & Lighting O.I. Lighting Electronics Polymer Electrical-Electronics & Lighting 2 Manufacturing Facilities in China and 3 Manufacturing Facility in Romania, 13 Facilities in India manufa
Slide 22: Technology for Two Wheelers
Technology for Two Wheelers Electronic Fuel Injection LED Headlamps, Mirrors for ICE vehicles and BS6 Safety Sustainability catalytic converters Traction motor and controller, Power assist ISG, and e- Connected Displays, TFT Drivetrain energy management and sensor Interfaces, Electrification systems
Slide 23: Technology for Four Wheelers
Technology for Four Wheelers ADAS, Driver Monitoring Systems, Surround View Systems, LED Headlamps & LCUs, Adaptive Front Safety Lighting Systems Mirrors Safety Signature Lighting, Interior Systems, In-Cabin Sensing, Personalization Personalization Interior Mood Lighting, Center Consoles FOTA in Tel
Slide 24: Product Portfolio Enhancement
Product Portfolio Enhancement Living our vision 1990 2010 2020 2030 ELECTRICAL - ELECTRONICS & ELECTRICAL - ELECTRONICS ELECTRICAL - ELECTRONICS LIGHTING • Proprietary products & LIGHTING & LIGHTING with continuous focus ADAS, DMS on innovative, cost Lighting Catalytic Converter Video Telematics com
Slide 25: Our 2W and 3W EV Capabilities
Our 2W and 3W EV Capabilities Charger • Locally designed, developed Telematics and manufactured • Fully IoT enabled machines BMS • Complete vertical integration DC-DC converter for Electronic Manufacturing • Motor Dyno Testing System for testing 2W and 3W EV Traction motor controller Traction motor/
Slide 26: Comprehensive Solution Provider (2W OEMs in India)
Comprehensive Solution Provider (2W OEMs in India) Diversified Portfolio Catering to 2W and 3W Segments Illuminated Handlebar Switch Mirror Assembly Adjustable Lever- holder Assembly Instrument Cluster/ USB Charger/ Seat Assembly Integrated Throttle Position Sensor/ Handlebar Assembly Switch Capacit
Slide 27: Product Portfolio for PV
Product Portfolio for PV Broad Portfolio of Lighting, Metallic, Polymer and Advanced Safety Solutions End to end capabilities across design, Engineering, testing/validation, tooling, manufacturing and delivery Polymer Lighting Metallic Electronics Roof Rails ADAS and DMS Gears Instrument Panel Conso
Slide 28: Unlocking Synergies across Businesses
Unlocking Synergies across Businesses Varroc's unique positioning as a systems supplier is strengthened through collaboration across its businesses. Traction Motor 4W ORVM Mirror with Gearbox Polymer + Electrical Electrical + Metallic Cross Mirror and Tailgate Business Seat with Signal Lighting Poly
Slide 29: Unlocking Synergies across Segments
Unlocking Synergies across Segments Varroc Vision Processing Platform - one platform – various products and market segments VCAM-Air - Dual ADAS Systems Lev Dashboard Camera 1 – 2 From Mono After Market- OEM Segment Camera to Sensor Fleet Segment Fusion HW: Ambarella CV22 SoC Platform HW: Ambarella
Slide 30: Excelling as a Systems Supplier
Excelling as a Systems Supplier Components • Customer CTQs • Component Design • Robust analysis to predict the design meets all CTQs • Tolerance analysis to ensure DFM Motor • Material and component data Base to speed up the design Sub-Systems • Customer requirements and CTQs • Sub-system level CTQs
Slide 31: Capabilities: Product Development
Capabilities: Product Development End-to-end capabilities across design, engineering, testing/validation, tooling, manufacturing and delivery Testing and Validation Project and Program Facilities CAE and Simulation Management Structural & Vibration Functional Performance DFSS/DMAIC Product Life Cycl
Slide 32: Capabilities: Manufacturing
Capabilities: Manufacturing ELECTRICAL - ELECTRONICS LIGHTING METALLIC POLYMER • SMT Lines for Electronics • High Vacuum Metallizing • Forging (Cold, Warm and Hot) • Plastic Injection Molding assemblies • Paint shop • Hard Coating and UV curing • Heat Treatment • Winding Machines for • Foam Molding
Slide 33: Our Customers
Our Customers TWO/THREE WHEELERS PASSENGER CARS COMMERCIAL VEHICLES EARTH MOVERS & OFF ROADS
Slide 34: Our Commitment
Our Commitment Creating meaningful differences to the society and environment Environmental Nurturing Future Social Impact Programs Sports Talent Programs • Kham River Eco Restoration Project (1.5 km) • Varroc Vengsarkar Cricket Academy (VVCA) • Learn and Earn Program at Varroc Academy • Solar & Win
Slide 35: Our Key Strengths
Our Key Strengths Continuous Focus on R&D Strong Competitive Long Standing, Comprehensive Low-Cost Capabilities Enhancing Position in a Growing Growing Customer Solution Provider Manufacturing Portfolio Market Segment Relationships Footprint • End-to-end services across design, • Developing innovati
Slide 36: Board & Leadership Team
Board & Leadership Team Independent Directors Arjun Jain Vidyadhar Limaye Director and CEO – President –Polymer Marc Szulewicz Business Division I Business Ex-General Manager, • Total Experience: ~11 years • Total Experience: ~35 years Foreign equipment • Previously associated with IAC • Previously
Slide 37: Thank You
la Vorrfroc EXCELLENCE