M&M Investor Presentation

June 2013

Copyright 2012 Mahindra & Mahindra Ltd. All rights reserved.

Three Speed Economies

Phrase Courtesy : Christine Lagarde

All around us

US on Path of Growth

Europe Contraction

Emerging Markets -

Growing

External Factors

All around us
India story
Policy Action

Investment Slowdown

Political Uncertainty

GDP Growth
Current Account Deficit

Cost of Borrowing

FY 2014 will be crucial one to watch

4

Double-Edged Sword
Global
Domestic

The Mahindra Group comprises 10 business sectors with a presence in 18 Industries Business Sectors
Automotive & Farm Equipment Financial Services Systech

Hospitality
2 Wheeler Aftermarket

Information Technology
Real Estate Defence Systems

(Steel, Retail, Trade, Logistics, Boats, Energy, Media)

6

Mahindra Partners

Mahindra Group
Business Leadership

Market leader in Utility Vehicles in India

Market leader in Tractors in India.

Number One Global tractor manufacturer (Single legal entity) Mahindra Finance : Leader in rural financing

Tech Mahindra : Leader in Telecom Software

Mahindra Holidays : Leader in Time Share

Mahindra & Mahindra Ltd.

Company Overview

M&M is one of India's leading utility vehicle and tractor manufacturers Market leader for FY13 both in UVs (market share 47.7%) and in tractors (market share 40.2%)

Equity Structure of the company

25.2% Promoter & Promoter Group, 74.8% Public (44.2% Foreign)
As at March 31, 2013

Manufacturing plants all across India Auto plants 6, Tractor plants 7, Foundry plant 1
Subsidiaries Total - 125 , Operational 41
As at March 31, 2013

Shareholding Pattern
Top 10 Shareholders with > 1%
Individuals 15.2% FI / MF / Banks 1.4%

Life Insurance Corporation of India

Promoter and Promoter Group 25.2%

Golboot Holdings Ltd (Goldman Sachs)

ICICI Prudential Life Insurance Ltd

First State Investments

Insurance Cos. 14.0%

Europacific Growth Fund General Insurance Corporation of India

Government of Singapore
The New India Assurance Company Ltd
FII / NRI / GDR 44.1%

Vanguard Emerging Markets Stock Index

Fund

J P Morgan Group

Financials

10

Financial Highlights
Q4- FY13 Vs Q4- FY12 (M&M + MVML)
Growth in Total income Rs 11,342 crs Growth in EBIDTA Rs 1,435 crs Growth Growthin inPAT PAT* Rs 963 crs

10%

31%

6%

Rs 10,334 crs

Rs 1,092 crs

Rs 911 crs

Rs 872 crs

33%
* On like to like comparison, excluding one time benefit of Rs. 257 crores on account of MADPL merger from FY 2012 & 91 crs in FY 13 of Exceptional Gain on sale of MHRIL shares

Rs 654 crs
11

Financial Highlights
FY13 Vs FY12 (M&M + MVML)
Growth in Total income Rs 43,655 crs Growth in EBIDTA Rs 5,329 crs Growth Growthin inPAT PAT* Rs 3,634 crs

25%

28%

21%

Rs 35,005 crs

Rs 4,150 crs

Rs 2,997 crs
Rs 3,544 crs

29%
* On like to like comparison, excluding one time benefit of Rs. 257 crores on account of MADPL merger from FY 2012 & Rs. 91 crs in FY 13 of Exceptional Gain on sale of MHRIL shares

Rs 2,740 crs
12

Strong Growth Trajectory

Figures on Standalone basis (M&M + MVML)
Gross Revenue & Other Income
30% 35,005 26,201 20,735 15,072 861 2,068

Rs. Crs.

PAT
43% 2,997 2,687 3,634

43,655

FY09

FY10

FY11

FY12

FY13

FY09

FY10

FY11

FY12

FY13

EBITDA
13.9%
47% 4,150 3,621 2,965 5,329

8.8%
1,155

FY09

FY10

FY11

FY12

FY13

13

Strong Growth Trajectory

Consolidated Accounts
Gross Revenue & Other Income
27% 63,358 74,403 3,080 3,127

Rs. Crs.
PAT after MI
31% 4,099

2,479
28,992 33,790 39,864 1,405

FY09

FY10

FY11

FY12

FY13

FY09

FY10

FY11

FY12

FY13

EBITDA
24% 6,245 5,015 3,163 5,449

7,449

FY09

FY10

FY11

FY12

FY13
14

Delivering consistent, long term value

Last 21 years
M&M 32.8

Last 11 years 30.2

Last 5 years 2.5

Sensex

4.4

5.4

1.2

Gold

4.7

5.3

1.7

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

45.00

Note: Adjusted for Bonus & Stock-split Ex Dividend price

Copyright 2012 Mahindra & Mahindra Ltd. All rights reserved.

15

Original Investment Cost Vs. CMP

Rs. Crs

As on 31st, March 2013 Listed Companies Subsidiaries Associates Total

Cost

Market Value 11,090 6,592 17,683

2994 649 3,644

16

Unlocking Shareholders Value Since 2005

Corporate Actions Bonus Issue FY 2005 1:1 Stock Split FY 2011 1:2

17

Strong Credit Profile

DE Ratio M&M + MVML

Gearing Multiple M&M + MVML

Stable Rating AA+ by CRISIL/ICRA/CARE *

0.81 0.45 0.32 0.37

2.94

1.12 0.3 0.82

0.98

0.76

F 2009 F 2010 F 2011 F 2012 F 2013

F 2009

F 2010

F 2011

F 2012

F 2013

Healthy financial risk profile supported by considerable financial flexibility arising from market value of investments - Crisil s Credit Rating Report, April 2013
* Rating is for M&M Ltd (Standalone Company)

Copyright 2012 Mahindra & Mahindra Ltd. All rights reserved.

18

Marathon Runner
Prudent Capital Allocation Support growth with Strategic Acquisition Maintain strong Credit Rating Deliver long term shareholder value

19

M&M + MVML- FINANCIAL PERFORMANCE

Rs. Crs.

F 2013 Q4 Gross Turnover Net Sales & Op. Inc. PBIT 11,342 9,983 1,309

F 2012 Q4 10,334 9,108 978

% Inc/ (Dec) 9.8 9.6 33.8

PAT
OPM (%) Adjusted PAT

963
14.38 872

911
11.99 654

5.7
2.39 33
20

M&M + MVML- FINANCIAL PERFORMANCE (full year)

Rs. Crs.

F 2013 Gross Turnover Net Sales & Op. Inc. PBIT PAT OPM (%) Adjusted PAT 43,655 38,357 5,081 3,634 13.89 3,544

F 2012 35,005 31,370 3,965 2,997 13.23 2,740

% Inc/ (Dec) 24.7 22.3 28.2 21.3 0.66 29

21

M&M + MVML - BALANCE SHEET

Rs. Crs.

F -2013
Source of Funds Shareholders Funds Loan Funds * Deferred Tax Liability Total 15,055 4,464 756 20,275

F -2012

12,219 4,544 589 17,352

* Includes current maturities of Long Term Liabilities

22

M&M + MVML - BALANCE SHEET

Rs. Crs.

F -2013 Application of Funds Fixed Assets 7,747

F -2012

6,889

Investments
Long Term Loans & Advances Cash & Bank Balances Proposed Dividend Other Assets (Net) Total

10,894
2,562 1,823 (891) (1860) 20,275

9,474
1,734 1,291 (869) (1167) 17,352
23

Key Ratios
Particulars OPM (%) ROCE Interest Coverage Ratio Debt / Service Ratio EPS (Basic) (Rs.) Book Value (Rs.) F 2013 13.89 26.79 16.08 6.63 61.63 254.85 F 2012 13.23 24.95 14.11 5.44 50.98 207.27

24

25

Financial Highlights
M&M Consolidated FY 13 vs. FY 12
Growth in Total income Rs. 74,403 crs Growth in EBIDTA Rs. 7,449 Growth in PAT after MI Rs. 4,099 crs

17% Rs. 63,358 crs

19% Rs. 6,245

31% Rs. 3,127 crs

26

M&M Group Consolidated Results

Rs. Crs.

F 2013 Net Sales & Op. Income PAT before MI # PAT after MI 68,735 4,129 4,099

F 2012 59,398 3,060 3,127

% Inc/ (Dec) 15.7 34.9 31.1

# includes share in profits of Associates

27

Subsidiary Company Results

Rs. Crs.

F 2013 Net Revenue PAT before MI # PAT after MI 36,970 389 359

F 2012 33,580 132 199

% Inc/ (Dec) 10% 195% 80%

# includes share in profits of Associates

28

Group Companies Top 4 PAT Earners

MMFSL MLDL TML MHRIL

F13 Rs.927 crs F12 Rs.644 crs

44%

F13 Rs 141 crs

F13 Rs. 1,288 crs

F12 Rs. 1,096 crs

F13 Rs.91 crs F12 Rs. 102 crs

(11%)

F12 Rs 119 crs

18%

18%

On Consolidated basis.

29

Segment Details
Rs. Crs.

Systech
Revenue
FY 13 4,988 5% FY 12 5,249

STP * Revenue
1,416 5% 1,486

IT Services Revenue
1,464 50%

2,904

Systech Results
FY 13 (44)
120% FY 12 226

STP *
Results
88

IT Services

Results
222 48% 425
30

28%
123

* STP Steel Trading & processing

Segment Results is before Exceptional items

Segment Details
Rs. Crs.

Farm Equip.
Revenue
FY 13 13,384 4% FY 12 13,283

Others Revenue
2,850 15% 2,469

Farm Equip. Results

FY 13 1,828
5% FY 12 1,925

Others
Results
(295)

15%
(256)
Segment Results is before Exceptional items
31

Segment Details
Rs. Crs.

Automotive Fin. Services

Revenue
FY 13 41,874 27% FY 12 32,838

IDS Revenue
754 5% 716

Hospitality Revenue
727 13%

Revenue
4,117 42% 2,901

FY 13

644

FY 12

Automotive Fin. Service

IDS
Results
243

Hospitality

Results
FY 13
2,330 101% FY 12 1,157

Results
1,284

Results
141 7% 132 FY 12
32

FY 13

35%
953

23%
198

Segment Results is before Exceptional items

Automotive Sector

33

Indian Auto Industry Vehicle Sales

Series4 Series3 Series2 Series1

3,600,000 3,400,000 3,200,000 3,000,000 2,800,000 2,600,000 2,400,000 2,200,000 2,000,000 1,800,000 1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 F-83 F-85 F-87
F-84 F-86

Total 4W Industry CAGR Growth

CAGR 83 13 CAGR 03 13 10.6% 13.6%

F-88

F-90

F-92

F-94

F-96

F-99

F-01

F-03

F-05

F-07

F-08

F-10

F-89

F-91

F-93

F-95

F-97

F-98

F-00

F-02

F-04

F-06

F-09

F-11

F12

Source : SIAM

FY13 / FY12.2.0%
34

F13

M&M Auto Sector sales Domestic + Export

Total AS Sales (000)

563

21% CAGR
87 117

483

377
298

231
178

230

145

149

F03

F04

F05

F06

F07

F08

F09

F10

F11

F12

F13

35

Utility Vehicle

Player in
India
*M&M Ltd. is the largest utility vehicle company in India SIAM data

36

F13: Unique Year for UV industry

F13 likely to repeat for next two years
60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% -10.0% -20.0%
F02 F03 F04 F05 F06 F07 F08 F09 F10 F11 F12 F13

Car Vs UV Growth %
Car Growth

52.2%

60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0%

M&M Vs Industry Growth %

M&M UV Growth UV Industry Growth

52.2%
30.5%

-6.7%

-10.0% -20.0%

F02 F03 F04 F05 F06 F07 F08 F09 F10 F11 F12 F13

Increased Focus on the UV market

F02
UVs available UVs (MNC make) Price range (Rs. Lac) UV / (UV + Cars)
Source: SIAM, Industry

80.0%

Changing Dynamics of UV Segment

F13
40 25 5 25 23%

70.0% 60.0% 50.0% 40.0% 30.0%

16 2 4-8 17%

Indian OEM Share MNC OEM Share

57.5% 42.5%

20.0%
F02 F03 F04 F05 F06 F07 F08 F09 F10 F11 F12 F13

37

Presence across all price points

1 8 .5 L 1 2 .3 L 8L 1 1 .5 L 1 4 .7 L 2 0 .6 L

7 .4 L

1 0 .8 L

5 .9 L

7 .7 L

6 .7 L 5L

7 .4 L 10 L 1 2 .5 L 15 L 20 L
38

Presence across all price points

5 .5 L 6 .2 L

3 .7 L 3 .5 L 3 .7 L

3 .8 L 5 .5 L 4 .1 L 4 .5 L

3 .4 L
1 .9 L

1 .6 2 L 1 .6 9 L 1L 2L 3L 4L 5L 6 .2 L
39

FY2013 - Domestic Market Performance

Auto Indsustry & M&M - FY13 / FY12
Segment UV Total Cars (Verito) Vans Total SCV < 2T 2T > LCV < 3.5T 3W Total LCV > 3.5 T Total MHCV (>16.2 T) M&M AS F13 Growth Actual
263,925 15,344 31,437 39,911 102,885 65,510 8,925 2,977 30.5% -14.0% 22.6% -25.9% 40.7% -2.9% -13.6% -14.7%

Industry F13 Actual

553,660 226,501 237,298 247,426 190,447 538,291 87,014 116,123

Growth
52.2% 21.1% 1.1% -1.4% 72.9% 4.9% -12.2% -32.2%

M&M Mkt. Share F13 F12 Actual Actual

47.7% 6.8% 13.2% 16.1% 54.0% 12.2% 10.3% 2.6% 55.6% 9.5% 10.9% 21.5% 66.4% 13.1% 10.4% 2.0%

Source : SIAM

40

F13: M&M International Market Performance

High growth in H1, Slowdown in H2

H1F13

H2 F13
29,176 18,190 16,220 14,226 12%

F13
32,456 11%

12,956 40%

H1F12

H1F13

H2 F12

H2 F13

F12

F13

F13 Growth Markets

South Africa Chile Nepal 57% 48% 47%

F13 Concern Markets

Sri Lanka Bangladesh Bhutan 18% 63% 77% Mkt. drop + duty impact Mkt. drop Regulation for import payment

41

SYMC
Bn KRW

CY 12

CY11

Growth

Volume (No.)
Revenue PBDIT PBT

120,717
3,010.5 39.0 (106.1)

113,001
2,912.1 (31.3) (112.4)

6.8%
3.4% -

Rexton W

1. CY 12 PBDIT before provision of unpaid leave workers legal case of KRW 15.6 Bill
2. CY 11 PBT includes KRW 49 Bill income from creditors write back as per rehabilitation plan

Bn KRW

Kor ando C
Q1 CY 13 Q1 CY12 26,441 Growth 18.2% 31,265

Volume (No.)

Revenue
PBDIT PBT

782.6
23.1 (9.8)

675.6
0.8 (31.6)

15.8%
-

Kor ando Tur ismo

42

1. Q1 CY 13 PBDIT before provision of unpaid leave workers legal case of KRW 5.8 Bill

Customer Satisfaction Performance

JD Power
2012 CSI

TNS
2012 TCS

JD Power
2012 IQS

Most improved brand for XUV500 ranked No. 1 with 2012 Renault Duster 5th Rank (11th in 2011) Bolero ranked No.1 with Toyota Innova

First time M&M product is under 100 PP100V

43

Presence in every nook and corner

Sales Network 1232
Service Network - 1371

Network reaching more than 70% of the districts in India

Total of 1,300 up-country outlets in 900 towns/semi-urban and rural

areas across the country

44

Financial Performance AD + MVML

Rs. Crs.

Q4FY2013

%YoY

FY2013

%YoY

Segment Revenue
Segment Results (after exceptional items)
Segment capital employed

Rs. 7,163

38%

Rs. 26,489

34%

Rs.890

52%

Rs. 3,118

45%

Rs. 6,167

20%

Rs. 6,167

45

SIAM F14 Outlook

Segment Cars UVs Vans PV Total LCV Goods MHCV Goods Passenger Buses 2W 3 W Goods 3W Passenger 3W Total Total Industry F13 Actual Growth F14 Growth (Est) -6.70% 52.20% 1.10% 2.20% 15.90% -25.90% -4.10% 2.90% -9.20% 8.60% 4.90% 2.60%

(as on Apr-13) 3-5% 11-13% 4-6% 5-7% 10-12% 1-3%

6-8% 6-8% 2-4% 3-5% 3-5% 6-8%

46

Farm Equipment Sector

47

Domestic Industry Historical Volumes

No. of tractors (F73-F82)
600000

CAGR : 15.0% (F86-F92) (F94-F00) (F03-F11)

CAGR: 8.2% (F73 F13)

500000

535210

480377

525970

400000

400203

318427 300000 246404 258674 262621 302241 303783

200000 148219

212732 187675 136376

228262 214255

226105

175475 160052

100000 59250 22484 31964 41782

F73 F75 F77 F79

77636

81629 72106
F85 F87

89631

64703
F81 F83

0
Source : TMA

F89

F91

F93

F95

F97

F99

F01

F03

F05

F07

F09

F11

48

F13

*M&M Ltd. is the largest tractor company in the world, by

volume

49

M&M Domestic Market Performance

221,730

18% CAGR
60,005 41,282 44,807 F03 F04 F05

202,513 166,359

211,596

113,269

95,006 90,509

78,048

F06

F07

F08

F09

F10

F11

F12

F13

50

F13 : One of The Lows..

535210 525970

221730

211596

F12

F13

F12

F13

Industry

M&M

Continued Domination
FES MS : 40.2% (Loss : 1.2% over PY)
51

52

Tractor Market Share

Total no. of Tractors
302,241 303,921 400,203 480,377 535,210 525,970

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

4.4 5.3 3.5 9.8 14.7

6.0 5.3 3.1 8.9 13.5

7.0 4.8 2.8 8.7 13.3

8.0 5.1 2.6 8.6 13.2 20.4

7.5 5.2 2.8 8.3 11.4

5.7 5.2 2.5 9.7 11.7 JD FNH Others Sonalika Escorts Tafe+Eicher Mahindra

23.5

22.3

22.0

23.4

25.0

38.9

40.8

41.4

42.0

41.4

40.2

F08
Source : TMA

F09

F10

F11

F12

F13
52

F13 : Exports

13,722 11,812 8,837 6,933 12,289

8,533 6,981 5,746 4,769 7,525

5,385

F03

F04

F05

F06

F07

F08

F09

F10

F11

F12

F13

Degrowth in SAARC Countries

53

Customer Satisfaction Index

Mahindra & Swaraj : among Top 2 Brands
115 108

106

96 93 89 84 79 76 83 93

96

F08

F09

F10

F11

F12

F13

54

Beyond tractors
towards Farm Tech Prosperity

55

Powerol
Powerol Gross Revenue (Rs. Crs)

1,000 870

Powerol Revenue Share Telecom 18%

15%

HUPS 7%
Ind. Eng. Apps 3%

Retail 34%

F12

F13

Exports 3%

Service 35%

56

Agri Business
Agri Business Revenue (Rs. Crs) 343.5

Agri Business Revenue Share Agri Inputs 28%

182.9

88% MIS 47%

F&V 25%

F12

F13

57

Financial Performance FES

Rs. Crs.

Q4FY2013

%YoY

FY2013

%YoY

Segment Revenue
Segment Results (after exceptional items)
Segment capital employed

Rs. 2,853

3%

Rs. 11,990

3%

Rs.456

5%

Rs. 1,858

1%

Rs. 2,504

7%

Rs. 2,504

58

F14 : Industry Outlook

Industry expected to grow at 6 - 8%

59

Sustainability

Released annual sustainability reports since 2008 to map triple bottom line performance Received A+ rating which is externally assured Ranked 1st in S&Ps ESG India Index-2012 One of the top rankers in the Asian Sustainability Ratings (ASR) Winner in the automobiles category, under the Energy Intensive industries cluster, in the Green Business Leaders award 2011-12 instituted by Emergent Ventures India & Financial Express. CII Sustainability Plus Rating: M & M rated no.1 in transport equipment sector in Gold category and

secured 9th place out of total 100 rated companies. In the year 2012.

Carbon Disclosure Leadership Index: M&M Limited was rated with a second highest score of 82 among the top

200 Indian companies in the CDLI ratings for 2012.

60

Commitment to Society

The Mahindra Group

has pledged to dedicate

1% of its Profit after Tax to CSR

initiatives

61

Thank you
Visit us at www.mahindra.com

Disclaimer
Mahindra & Mahindra herein referred to as M&M, and its subsidiary companies provide a wide array of presentations and reports, with the contributions of various professionals. These presentations and reports are for informational purposes and private circulation only and do not constitute an offer to buy or sell any securities mentioned therein. They do not purport to be a complete description of the markets conditions or developments referred to in the material. While utmost care has been taken in preparing the above, we claim no responsibility for their accuracy. We shall not be liable for any direct or indirect losses arising from the use thereof and the viewers are requested to use the information contained herein at their own risk. These presentations and reports should not be reproduced, re-circulated, published in any media, website or otherwise, in any form or manner, in part or as a whole, without the express consent in writing of M&M or its subsidiaries. Any unauthorized use, disclosure or public dissemination of information contained herein is prohibited. Unless specifically noted, M&M or any of its subsidiary companies is not responsible for the content of these presentations and/or the opinions of the presenters. Individual situations and local practices and standards may vary, so viewers and others utilizing information contained within a presentation are free to adopt differing standards and approaches as they see fit. You may not repackage or sell the presentation. Products and names mentioned in materials or presentations are the property of their respective owners and the mention of them does not constitute an endorsement by M&M or its subsidiary companies. Information contained in a presentation hosted or promoted by M&M is provided as is without warranty of any kind, either expressed or implied, including any warranty of merchantability or fitness for a particular purpose. M&M or its subsidiary companies assume no liability or responsibility for the contents of a presentation or the opinions expressed by the presenters. All expressions of opinion are subject to change without notice.

Copyright 2012 Mahindra & Mahindra Ltd. All rights reserved.

62