Hero motocorp 1.1
description
Transcript of Hero motocorp 1.1
HumMain Hai Hero
Introduction
• Hero Motocorp Ltd, formerly Hero Honda, is an Indian motorcycle and scooter manufacturer based in New Delhi, India.
• It has three manufacturing facilities based at in Haryana and Uttarakhand.
• It has a large sales and service network with over 3,000 dealerships and service points across India.
• It accounts for 46% of all bikes sold in India. The company exports to Africa, Asia, Eastern Europe and Latin America.
• Hero Honda has a simple vision - the vision of a mobile and an empowered India, powered by its two wheelers
Source: http://www.heromotocorp.com/en-in/
Source: http://www.heromotocorp.com/en-in/
Timeline Post De-merger2012: • 1. Debut in the AMA Superbike Racing in the US• 2. Migration of all products to Brand Hero• 3. Launch of Impulse, Maestro and Ignitor
2013:1. Global Parts Centre Foundation Stone laid2. 50 Million cumulative 2 wheelers production3. Neemrana Plant Foundation Stone laidSource: http://www.heromotocorp.com/en-in/
2011
Dec.2010,Termination of joint venture
Only 26% stake for Hero Group in Hero
Honda JV.
Hero Group could not export to international but termination meant
export. Heavy reliance on Honda for Japanese
technology
Demerger
Source: http://www.heromotocorp.com/en-in/
Reasons for the Split.
Actions Taken.
Issues that Arose after the Demerger
Source: http://www.heromotocorp.com/en-in/
Key Personnel
Dr. Brijmohan Lall Munjal- Founder Director and Chairman of the Company and the $3.2 billion Hero Group
- Past President of (a) Confederation of Indian Industry (CII) (b) Society of Indian Automobile Manufacturers
(SIAM)
- Member of the Board of the Country's Central Bank (Reserve Bank of India).
Source: http://www.heromotocorp.com/en-in/
Mr. Pradeep Dinodia
Gen. (Retd.)V. P.
Mr. Suman Kant Munjal
Mr. Paul Edgerly
Board Of Directors
Board Of Directors
Mr. M Damodaran
Dr. Pritam Singh
Mr. Ravi NathMr. Pawan Munjal
Shareholding PatternHolder's Name No of Shares % Share Holding
Promoters 79712482 39.92%
Foreign Institutions 60658982 30.38%
Foreign OCB 24547008 12.29%
Financial Institutions
13504113 6.76%
General Public 12721316 6.37%
Banks Mutual Funds
4023499 2.01%
Other Companies 3189393 1.6%
Others 1108136 0.55%
Foreign NRI 222571 0.11%
Products And Services
• The company sells a range of products in motorcycles and scooters (2-wheeler category).
• It also produces and sells spare parts for its 2-wheelers.
Source: http://www.heromotocorp.com/en-in/
Motorcycles
It has 17 models of motorcycles across the 100 cc, 125 cc, 150 cc, 225 cc categories.
Key products : • Splendor• Passion• Glamour • CBZ X-treme • Hunk, • Ignitor
Source: http://www.heromotocorp.com/en-in/
Scooters
It has 2 models in scooters:
• Pleasure• Maestro
Source: http://www.heromotocorp.com/en-in/
90%
10%
Motorbikes
Scootors
Sales Volume Contribution (%)
Exports
• Hero MotoCorp as of now exports only to Latin and Central America and Africa
• They aiming to sell one million units across the world by 2016-2017
• The Hero motorcycles to be sold in these markets
include a mix of models from the 100cc and 125cc range.
• For the fiscal 2013-14, Hero MotoCorp has earmarked Rs 1,100 crore as capital expenditure
• Exports grew 24% during the year 2011-2012, as they exported 164,570 two-wheelers
Achievements
• Green Pioneer award
• Best value for money bike maker
• Life achievement awards from TERI, E&Y, AIMA and ET.
• The Brand Trust Report published by Trust Research Advisory ranked Hero Honda in the 13th position.
• Forbes 200 ‘Most Respected’ companies
• Indian Automotive Hall of Pride by Overdrive Source: http://www.heromotocorp.com/en-in/
Abridged Annual Statements of
Past 5 years
• Balance Sheet (March 2009-2013)
• Profit and Loss (March 2009-2013)
Source: www.moneycontrol.com
SOURCES OF FUNDS Mar '13 Mar '12 Mar '11 Mar '10 Mar '09
Total Share Capital 39.94 39.94 39.94 39.94 39.94
Equity Share Capital 39.94 39.94 39.94 39.94 39.94
Share Application Money
0.00 0.00 0.00 0.00 0.00
Preference Share Capital
0.00 0.00 0.00 0.00 0.00
Reserves 4,966.30 4,249.89 2,916.12 3,425.08 3,760.81
Revaluation Reserves
0.00 0.00 0.00 0.00 0.00
Networth 5,006.24 4,289.83 2,956.06 3,465.02 3,800.75
Secured Loans 302.16 994.85 1,458.45 0.00 0.00
Unsecured Loans 0.00 0.00 32.71 66.03 78.49
Total Debt 302.16 994.85 1,491.16 66.03 78.49
TOTAL LIABILITIES
5,308.40 5,284.68 4,447.22 3,531.05 3,879.24
Balance Sheet
APPLICATION OF FUNDS
Mar '13 Mar '12 Mar '11 Mar '10 Mar '09
Gross Block 4,427.29 6,308.26 5,538.46 2,750.98 2,516.27
Less: Accum. Depreciation
1,356.31 2,522.75 1,458.18 1,092.20 942.56
Net Block 3,070.98 3,785.51 4,080.28 1,658.78 1,573.71
Capital Work in Progress
62.09 193.95 125.14 48.14 120.54
Investments 3,623.83 3,964.26 5,128.75 3,925.71 3,368.75
Inventories 636.76 675.57 524.93 436.40 326.83
Sundry Debtors 665.00 272.31 130.59 108.39 149.94
Cash and Bank Balance
181.04 56.10 47.75 1,863.48 217.49
Total Current Assets 1,482.80 1,003.98 703.27 2,408.27 694.26
Loans and Advances 1,401.95 926.99 783.48 438.46 325.80
Fixed Deposits 0.00 20.72 23.77 43.73 2.08
Total CA, Loans & Advances
2,884.75 1,951.69 1,510.52 2,890.46 1,022.14
Deffered Credit 0.00 0.00 0.00 0.00 0.00
Current Liabilities 2,893.39 3,520.66 5,316.40 3,965.69 1,678.93
Provisions 1,439.86 1,090.07 1,081.07 1,026.35 526.97
Total CL & Provisions 4,333.25 4,610.73 6,397.47 4,992.04 2,205.90
Net Current Assets -1,448.50 -2,659.04 -4,886.95 -2,101.58 -1,183.76
Miscellaneous Expenses
0.00 0.00 0.00 0.00 0.00
TOTAL ASSETS 5,308.40 5,284.68 4,447.22 3,531.05 3,879.24
Financial Performance Analysis of Consolidated
Balance Sheet
Net Worth
Total Debt
Total current assets and loans and advances
5006
295634
65
3800
4289
Net Worth
Total Assets and Total Asset Turnover ratio
2008-09 2009-10 2010-11 2011-12 2012-13
3879.243531.05
4447.22
5284.68 5308.4
Total Assets Rs. in cr.
2008-09 2009-10 2010-11 2011-12 2012-130
5000
10000
15000
20000
25000
30000
Sales Rs. in cr.
2008-09 2009-10 2010-11 2011-12 2012-130123456 Total Asset Turnover Ratio
Announced an investment of Rs 2,575 crore in expanding capacity at its three existing plants
The company will make initial investment of Rs.400 crore in the Neemrana facility.
Hero MotoCorp has also signed a state support agreement (SSA) with the Gujarat government to set up a new plant in the site.
Current Investments
Mar '13 Mar '12 Mar '11 Mar '10 Mar '09
INCOME
Sales Turnover23,768.
1125,252.
9820,787.
2716,856.
4313,553.
23
Excise Duty 0.001,666.1
81,420.3
01,016.8
51,227.8
5
Net Sales23,768.
1123,586.
8019,366.
9715,839.
5812,325.
38
Other Income 398.38 347.46 238.27 290.69 222.14
Stock Adjustments 0.00 94.03 27.00 -11.54 22.09
TOTAL INCOME24,166.
4924,028.
2919,632.
2416,118.
7312,569.
61
EXPENDITURE
Raw Materials17,470.
7317,485.
6514,236.
4510,822.
998,842.1
4
Power & Fuel Cost 129.18 112.66 100.47 81.05 73.70
Employee Cost 820.92 735.52 618.95 560.32 448.65
Other Manufacturing Expenses
0.00 51.62 409.89 454.36 354.08
Selling and Admin Expenses 0.001,257.8
41,090.7
2885.03 669.98
Miscellaneous Expenses2,025.3
3389.52 340.42 280.64 205.90
Preoperative Exp Capitalised 0.00 0.00 0.00 0.00 0.00
TOTAL EXPENSES20,446.
1620,032.
8116,796.
9013,084.
3910,594.
45
Profit And Loss Statement
Mar '13 Mar '12 Mar '11 Mar '10 Mar '09
Operating Profit 3,321.95 3,648.02 2,597.07 2,743.65 1,753.02
PBDIT 3,720.33 3,995.48 2,835.34 3,034.34 1,975.16
Interest 11.91 33.43 28.20 11.14 13.04
PBDT 3,708.42 3,962.05 2,807.14 3,023.20 1,962.12
Depreciation 1,141.75 1,097.34 402.38 191.47 180.66
Other Written Off 0.00 0.00 0.00 0.00 0.00
Profit Before Tax 2,566.67 2,864.71 2,404.76 2,831.73 1,781.46
Extra-ordinary items 0.00 0.00 0.00 0.00 0.00
PBT (Post Extra-ord Items) 2,566.67 2,864.71 2,404.76 2,831.73 1,781.46
Tax 411.04 486.58 476.86 599.90 499.70
Reported Net Profit 2,118.18 2,378.13 1,927.90 2,231.83 1,281.76
Total Value Addition 2,975.43 2,547.16 2,560.45 2,261.40 1,752.31
Preference Dividend 0.00 0.00 0.00 0.00 0.00
Equity Dividend 1,198.13 898.59 2,096.72 2,196.56 399.38
Corporate Dividend Tax 203.62 145.77 340.14 371.00 67.87
Per share data (annualised)
Shares in issue (lakhs) 1,996.88 1,996.88 1,996.88 1,996.88 1,996.88
Earning Per Share (Rs) 106.07 119.09 96.55 111.77 64.19
Equity Dividend (%) 3,000.00 2,250.00 5,250.00 5,500.00 1,000.00
Book Value (Rs) 250.70 214.83 148.03 173.52 190.33
Financial Performance Analysis Of Consolidated
Profit & LossNet Sales
Operating Profit
Earning Per Share
ROCE
EBITDA
PBT
PAT
Net Sales
1583
9
2358
6
1936
6
1232
5
2376
3
Source: http://www.moneycontrol.com/india/stockpricequote/auto-23-wheelers/hero-honda-motors/HHM
Operating ProfitSource: http://www.moneycontrol.com/india/stockpricequote/auto-23-wheelers/hero-honda-motors/HHM
Earning Per Share
2008-09 2009-10 2010-11 2011-12 2012-130
20
40
60
80
100
120
140
64.19
111.77
96.55
119.09
106.07
EPS
Source: http://www.moneycontrol.com/india/stockpricequote/auto-23-wheelers/hero-honda-motors/HHM
ROCE
48.5
7
52.1
3
49.8
3
75.0
5
43.3
3
Source: http://www.moneycontrol.com/india/stockpricequote/auto-23-wheelers/hero-honda-motors/HHM
Ebitda
3720
3995
2835
3034
1975
Source: http://www.moneycontrol.com/india/stockpricequote/auto-23-wheelers/hero-honda-motors/HHM
PBT
2566
2864
2404
2831
1781
Source: http://www.moneycontrol.com/india/stockpricequote/auto-23-wheelers/hero-honda-motors/HHM
PAT
2118
2231
1281
2378
2007
Source: http://www.moneycontrol.com/india/stockpricequote/auto-23-wheelers/hero-honda-motors/HHM
Key Indicators of Profitability (%)
2012-13 2011-12 2011-10
Return on Capital Employed 48.57 49.83 52.13
Profit After Tax/ Income from Operations 92.57 100.7 101.9
Profit Before Tax/ Income from Operations 112.1 121.3 127.2
Profit Before Interest and Tax/ Income from Operations 136.40 122.81 106.33
Operating Profit before Tax/ Income from Operations 145.1 154.5 137.3
Operating Profit Before Depreciation, Interest And Tax/
Income from Operations162.5 169.3 149.9
Ratio Analysis
Turnover Ratio
Mar '11Mar '12
Mar '13
0
5
10
15
20
25
30
35
4.674.77
4.67
4.58 6.11 7.53
31.95
29.5132.11
Total Assets Turnover Ratio
Fixed Assets Turnover Ratio
Inventory Turnover Ratio
Source-Moneycontrol.com
Liquidity Ratio
Mar '11Mar '12
Mar '13
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.132
0.285
0.512
0.231
0.477
0.733000000000001
Quick RatioCurrent Ratio
Source-Moneycontrol.com
Profitability Ratio
Mar '11 Mar '12 Mar '130
2
4
6
8
10
12
14
16
11.3310.81
9.17
13.4
15.46
13.97
9.89
10.04
8.76Gross Profit Margin(%)Operating Profit Margin(%)Net Profit Margin(%)
Source-Moneycontrol.com
Leverage Ratio
Mar '11
Mar '12
Mar '13
0 50 100 150 200 250 300
100.544
119.518
312.37
85.275
85.693
215.505
0.335
0.188
0.057
Debt Equity RatioInterest CoverFinancial Charges Cov-erage Ratio
Source-Moneycontrol.com
Creditor’s Payment Period Calculation
Year Creditors’ Days
2010-11 45.126
2011-12 41.979
2012-13 33.442
Peer Group Analysis
Source: www.moneycontrol.com www.money.livemint.com
Top 5 Listed Competitors
Bajaj Auto Limited LML Maharashtra Scooters
TVS Motor Company Limited
Kinetic Motors
46%
20%
17%
10%
4%2%
1%
Current market Share
Hero Moto CorpBajaj AutoHondaTVSYamahaSuzukiMahindra
Sales Growth Trend Analysis
Companies Average of past 5 years
Hero Motorcorp 8.158
Bajaj Auto 14.566
LML -30.364
Maharashtra Scooters Ltd. -18.7
TVS Motors 1.154
Kinetic Motors -45.14
2008-09 2009-10 2010-11 2011-12 2012-13
-140
-120
-100
-80
-60
-40
-20
0
20
40
Sales Margin
Hero Motocorp Bajaj Auto LMLMaharashtra Scooters Ltd. TVS Motors Kinetic Motors
Sales Margin of past 5 years
EBIDTA (in Cr.)
ROCE (in %)
Hero MotoCor
p
Bajaj Auto LML Maharashtr
a Scooters TVS Kinetic
3,111.8 13,136.722 -11.44 14.69 362.79
6 -7.82
Hero MotoCor
p
Bajaj Auto LML Maharashtr
a Scooters TVS Kinetic
53.786 56.04 35.87 a11.38 10.61 379.886
ROE (in %)
PAT (in Cr.)
Hero MotoCor
p
Bajaj Auto LML
Maharashtra
ScootersTVS Kinetic
54.092 59.532 0.00 8.008 13.84 0.00
Hero MotoCor
p
Bajaj Auto LML
Maharashtra
ScootersTVS Kinetic
19,875.56
23,494.92 -62.89 16.55 84.40 -22.36
Net Sales
Company Name
Last Price Change % Change Net Sales(Rs. cr)
Hero Motocorp 2,265.25 18.75 0.83 23,768.11
Bajaj Auto 2,078.95 23.00 1.12 19,997.25
TVS Motor 96.00 0.30 0.31 7,065.00
LML 5.20 -0.01 -0.19 245.39
Mah Scooters 463.75 0.00 0.00 6.70
Kinetic Eng 40.35 0.00 0.00 80.22
Comparison between
Source: www.money.livemint.com
Source: www.money.livemint.com
Source: www.money.livemint.com
BAJAJ AUTOHERO
MOTOCORP
Dividend Payout Ratio (%) 41.6 56.6 73.5%
Dividend Payout Ratio
Market Cap
(Rs. Cr)
Revenue (Rs. Cr)
Net Profit (Rs. Cr)
Net Margin (%)
RoE (%) Price to Book
Price to Earnings
Hero Motocorp
44,818.86 24,908.26 2,128.88 8.40 45.57 6.83 21.05
Bajaj Auto 59,945.27 19,963.70 3,245.16 15.66 43.66 5.83 18.47
Past 1 year comparison
Source: www.money.livemint.com
Source: www.economictimes.com
Stock Price Comparison–Top 5
Company Name 1 Year 9 Month 6 Month 3 Month 1 Month 2 Week 1 Week Last Price
Bajaj Auto 1794.9015.94%
1917.458.53%
1988.204.67%
1900.409.50%
1942.707.12%
1968.405.72%
1977.905.21% 2,081.00
Hero Motocorp 1541.9047.46%
1662.2536.78%
2008.8013.18%
2067.509.97%
1965.1015.70%
2100.608.24%
2066.9010.00% 2,273.65
Kinetic Eng 54.85-26.44%
52.00-22.40%
68.00-40.66%
39.003.46%
38.754.13%
38.704.26%
39.053.33% 40.35
LML 5.102.94%
5.102.94%
5.40-2.78%
6.69-21.52%
5.191.16%
5.151.94%
5.063.75% 5.25
Mah Scooters 369.1025.98%
410.0013.41%
393.4518.19%
405.8014.59%
516.20-9.92%
468.55-0.76%
471.10-1.29% 465.00
TVS Motor 32.45196.15%
32.80192.99%
36.80161.14%
78.9521.72%
85.9011.87%
86.2011.48%
96.40-0.31% 96.10
Source: www.moneycontrol.com
Growing working
population
Middle class population
expanding by 3mn a year
Fast paced urbanization
Lack of good public
transport
Increasing city limits
Reasons for Growth
Future Growth• The company aims of achieving revenues of
$10billion and volumes of 10 million two-wheelers by 2016-17
• Hero MotoCorp hopes to achieve 10 per cent of their revenues from international markets
• Hero Motocorp achieved a turnover of 24,000 crore in the last year and it plans on achieving a turnover of 60,000 crores by 2020.
• Launching as many as 12 new products by April 2014.
• Entering new markets by 2050 the country is expected to top the world with approximately 611million vehicles on the nation’s road.
Upcoming Projects
• Setting up a fourth plant at Neemrana in Rajasthan
• Setting up a fifth plant at Halol in Gujarat
• Setting up a new state-of-the-art integrated R&D centre at Kukas, Rajasthan
• Setting up a Global Parts Centre (GPC) at Neemrana, Rajasthan
Source: http://www.heromotocorp.com/en-in/
Bibliography
• http://autocarpro.in/contents/technologyDetails.aspx?
TechnologyID=122
• http://www.wheelsunplugged.com/news/hero-motocorp-plans-go-
abroad-new-models-year/1236
• http://en.wikipedia.org/wiki/Hero_MotoCorp#cite_note-livemint1-20
• http://www.thehindubusinessline.com/companies/hero-motocorp-q1-
net-down-11-at-rs-549-cr/article4948658.ece
• http://www.moneycontrol.com/india/stockpricequote/auto-23-
wheelers/hero-honda-motors/HHM
• http://www.heromotocorp.com/en-in/
Group Members • Abhishek Shinde -13002
• Divya Gandhi -13021
• Imad Sirkhot -13032
• Karen D’Souza -13037
• Ketaki Misra -13038
• Kirk Coutinho -13040