Escorts Limited

Copyright 2013 Escorts Limited

Contents
Escorts Ltd. Overview
Escorts Agri Machinery Escorts Construction Equipments Escorts Railway Products Escorts Auto Products Financial Highlights Recent Developments

3
6 10 13 17 21 27

Award & Achievements

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December13

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Escorts Ltd
INDIAS 3RD LARGEST TRACTOR MANUFACTURER WORLDS LARGEST PICK N CARRY HYDRAULIC MOBILE CRANE MANUFACTURER

ESCORTS GROUP
PIONEER IN AUTOMOTIVE SHOCK ABSORBER MANUFACTURING ASIAS LARGEST MANUFACTURER OF AIR BRAKE SYSTEMS

December13

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Escorts Ltd
Escorts Ltd is one of India's leading engineering conglomerates Over six decades of experience in engineering innovation Strong focus on customer centric innovation Presence across growth sectors of Agri-machinery, Construction & Material Handling Equipment, Railway Equipment and Auto Components

Escorts Ltd

Escorts Agri Machinery (EAM)

Escorts Construction Equipment (ECE)

Escorts Railway Products (ERP)

Escorts Auto Products (EAP)

EAMs advanced agri-machinery & crop solutions help enhance agricultural productivity and add value to a farmers life

ECEs vast range of construction & material handling equipment supports Indias infrastructure growth

ERPs wide array of railway products aids the modernization of Indian Railways

EAPs auto suspension products leverage the high potential of the auto component industry

December13

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Management Team
Board of Directors
Rajan Nanda
Chairman
Active member of several apex trade and industry bodies and member of CII National Council

Nikhil Nanda
Managing Director
Alumnus of Wharton Business School, Philadelphia Responsible for driving Escorts growth initiatives to strategically position it in the global arena

Dr. S.A.Dave Director

The first Chairman of SEBI

Dr. P.S.Pritam Director

Retired as Executive Director of LIC India Over 40 years of expertise in large financial institutions

S.C.Bhargava Director
Senior Fellow member of ICAI Worked as a Technical Advisory Committee member for RBI

Hardeep Singh Director

Chairman - Monitoring committee on minimum support price (Planning Commission) & Food security Task force (CII)

Acting chairman of Centre for Monitoring Indian Economy, Mumbai

Corporate Heads

G. B. Mathur
EVP Company Secretary & Strategic Advisor
35 years experience in secretariat & legal matters. Responsible for all Secretarial matters.

Ishan Mehta
EVP HR & ER
32 years experience in aligning HR/ER strategies to business, enhancing organizational effectiveness and work place improvement

S Ramaswamy
VP Group General Counsel
30 years experience in Legal & Company Secretary Responsible for Group Corporate Law.

S Sridhar
CEO, Escorts Agri Machinery 26 years of experience in engineering, automotive & manufacturing

GVR Murthy
CEO, Escorts Construction Equipment 32 years of experience across sectors such as construction, cement products and mineral processing

Business Heads

Lalit K Pahwa
CEO, Escorts Auto Products 30 years of experience in engineering, manufacturing & automation

Dipankar Ghosh
Business Head, Escorts Railway Products 22 years of experience in systems & process, manufacturing operations and engineering Page 5

December13

Escorts Ltd.

Escorts Agri Machinery (EAM)

Leading Revolution in Agricultural Mechanization A move from being a "Tractor Manufacturer" to a complete "Farm Solutions Provider"
Indian Market International Market-Farmtrac

Comprehensive range of tractors with over 45 variants

Farmtrac 34-65HP
(Premium Range)

Powertrac 25-50HP
(Midsize, Efficient Range)

European Range

Heritage Series

Valuemaxx
For basic agricultural purposes

Agmaxx
For special PTO operated agri equipment

Loadmaxx
For heavy haulage & commercial applications

Supermaxx
For all applications, agriculture/ haulage

Inframaxx
For infrastructure based applications

An industry first, Escorts Jai Kisan Series tractors address the differentiated needs of the modern Indian farmer

Four plants - Farmtrac, Powertrac, Component, Crankshaft & Hydraulic - covering manufacturing area of 134,000 sq.m., with production capacity of 100,000 tractors p.a. Poland plant, a 100% subsidiary, has an installed manufacturing capacity of 2,500 tractors p.a.
December13
Escorts Ltd. Page 6

Industry: Drivers for Mechanization

HISTORICAL TRACTOR VOLUMES

Growth Drivers Higher MSP for key crops Increasing rural wages

Ease of credit availability

Increasing demand for food, fuel & fiber

Demand of safety & comfort

700.0 600.0 500.0 400.0 300.0 200.0 100.0 0.0

545.1 441.2 191.7 165.7 295.1 352.8346.5345.8 262.3

607.7 590.9

FY03

FY04

FY05

FY06

FY07

FY08

FY09

FY10

FY11

FY12 70 FY14E

Tractor Volumes ('000)

Source: ICRA

INCRASING RURAL WAGES

200 160 120 80 40 0 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 1% 5% 6% 8% 11% 16% 18% 20% 18% 25% 20% 15% 10% 5% 0% 1,600 1,400 1,200 1,000 800 600 400 200 0 FY05 FY06

RISING MSPs

80 60 40 20 0

34%

IMPROVED CREDIT TARGETS

24% 29% 24% 28

16% 15%

27% 57.5 47.5 21% 22%

14.1 17.5

22.5

32.5 37.5

FY06

FY07

FY08

FY09

FY10

FY11

FY12

FY07

FY08

FY09

FY10

FY11

FY12

FY13

Average daily wage rate in rural India for men(INR) Source: RBI y-o-y growth(RHS)

Paddy

Wheat

Coarse Cereals

Agri Credit Target (INR bn)

growth y-o-y (RHS)

INR/Qunital

Source: Dept. of Financial Services

December13

Escorts Ltd.

FY13

Page 7

FY13 40% 30% 20% 10% 0%

Our Approach
AMBITION
HISTORY CURRENT ASPIRATIONS

Tractor Manufacturer & Limited Reach

Building Brands & Expanding Geographies

Integrated Farm Solution Provider

GUIDING PHILOSOPHY
Focus on Premium Segment Highest commitment player

Frequent Renewal of Product Portfolio

Cost Discipline

Application based Product Segmentation

December13

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Farm Solution
Crop Focus approach

FARM SOLUTIONS

Dedicated Channel

Latest Tech offerings

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Escorts Construction Equipment (ECE)

Escorts entered into the field of Material Handling Equipment in 1971 and introduced the concept of Pick-n-Carry Hydraulic Mobile crane.
Material Handling Equipment Road Construction Equipment
Vibratory soil Compactor

Earth Moving Equipment

Backhoe Loader

Utility Equipment

Pick-n-Carry Cranes Slew Cranes

Telescopic Handlers

Wheel Loader Tandem Compactor Arial Work Platform

Truck Crane

Motor Grader

Forklift Truck

Tower Crane

Crawler Crane

State-of-the-art manufacturing and assembly facility sprawling 250,000 sq.ft. of space, Capacity of 14,000 units p.a.
December13
Escorts Ltd. Page 10

Industry
Infrastructure Spending - 11th & 12th Five Year Plan

Industry revenues estimated to reach US$ 22.7 billion by 2020 from US$ 4.2 billion in 2011

12th Plan
300 206 233.5 264.4

11th Plan
200 100 0 FY13E 101.6 101.9 75.7 69.4 89.5 157.4

181.2

Total infrastructure spend to be about 10% of GDP during the 12th Five-Year Plan

FY14E

FY15E

FY16E

Significant increase in rental and leasing business

400 300 200 356.4

12th Five Year Plan Fund allocation

Backhoe loaders & Crawlers excavators expected to account for significant sales

227.8 126.8

119.4 86.3

100

84.5

Others

Teleco m

Power

Source: Planning Commission

December13

Escorts Ltd.

Water Supply

Irrigati on

Tranp ort

Significant increase in Replacement Market Sales

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FY17E

FY08

FY09

FY10

FY11

FY12

Our Approach
AMBITION
HISTORY CURRENT ASPIRATIONS

Pick and Crane Manufacturer / Limited Reach

Leading Crane Manufacturer, presence across segments

End to End Solutions provider in Construction Equipment Sector

GUIDING PHILOSOPHY
Expand market & retain market leadership in Cranes Attain significant market penetration in Earth Moving Equipments

Manufacturer of Choice

Highest commitment player

December13

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Escorts Railway Products (ERP)

With over 40 years of rich experience in manufacturing of critical railway systems, Escorts has played a major role in the modernization of Indian Railways.
Brake Systems Couplers

Suspension Systems

Composite Material

Electro Pneumatic Brakes Air Brake System Passenger - Conventional & Axle Mounted Air Brake System - Freight - Conventional & Bogie Mounted

AARH CBC AAR H Centre Buffer Coupler LHB / Main line Coaches Semi Permanent Coupler Schaku TypeEMU/MEMU/DEMU Automatic Coupler - Kolkata Metro AAR H Transition Coupler Locos EMD/ALCO

Dampers TV Type Shocker Conventional Coaches NTa Type Shockers EMU Coaches with Air Suspension Ta Type Dampers Conventional Locos Dampers for LHB Coaches, ABB Locos, EMD Loco, Self Propelled Cars

CBB for Freight application CBB for Coaching application CBB for EMU application CBB for Loco application Disc Pads for LHB / Metro Coaches

Electro Pneumatic Brake System EMU/MEMU/DEMU

Pneumatic Brake System EMU- AC/AC

Vestibule
Fire Retardant Vestibule

The manufacturing plant spread across an area of over 12,500 sq. meters, Houses superior production and testing facilities, inclusive of a research and development centre; ISO 9001:2008
December13
Escorts Ltd. Page 13

Indian Railways
Growth Drivers
50% 40% 30% 20%

Railways Planned Investment- 12th Five Year Plan

44% 33%

Infrastructure Building Ex: Metro & Monorails

Modernization of Indian Railways

Rising transportation demand

Growth in freight traffic

Safety & Comfort

Increasing PPP

10% 0%

7%

8%

8%

Gauge New Line Track Conversion Renewals

Rolling Stock

Others

Investment Plans (INR Billion)

8000 6000 4000 2000 1920 2007-12 Total Stock 7350 1700 2012-17 Rolling Stock

Passenger Volumes (Million) 14 12 10 8 6 4 2 0 11.7

300 250 200 150 100 50 0

Cumulative Increasing FDI Inflows (US$ Million)

240.3 109.6 132.8 270.3

10.2 10.9 9.5 8.9 7.7 8.2 7.2 6.9 6.2 6.5

57.3

75.3

FY07

FY09

FY11

FY13F FY15F FY17F Source: Railways Budget 2013, Planning commission, Railway Ministry , Dept of Industrial Policy & Promotion

FY08

FY09

FY10

FY11

FY12

FY13

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Metro & Monorail

Growth in Metro Network (KM)

33 rail-based urban projects involving investment of over Rs. 3,080 billion expected in India over next 10 years 24 Metro Projects - Investment of Rs. ~2870 billion 5 monorail Projects at Rs ~140 billion & 4 suburban rail projects at Rs ~70 billion Expected Investments in metro rail networks USD 42 billion by 2020 amount invested so far USD 16.7 billion Over 2200 metro cars worth USD 3.45 billion would be added to the existing fleet

900 800 700 600 500 400 300 200 100 0 222 810

2011-12

2016-17

Monorail Projects over the next 5 years across Asia & S. America ($ bn)
Others, 5

Brazil, 15

India, 25

Source: Railways Budget 2013, Planning commission, Railway Ministry , Ministry of Urban Development

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Our Approach
AMBITION
HISTORY CURRENT ASPIRATIONS

Mechanical Component Manufacturer

Component centric supplier to Indian Railways

Solution centric approach

GUIDING PHILOSOPHY
Technology partnerships to complement future requirements

Focus on Electronic led product innovation

Substantial export Footprint

Lean Manufacturing

December13

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Escorts Auto Products (EAP)

EAP pioneered the manufacturing of automotive shock absorbers in India and it continues to be one of the leading manufacturers of auto suspension products

Shock Absorbers
Two & Three Wheelers

McPherson Struts
Four Wheelers

Telescopic Front Forks

Light Commercial Vehicles

Passenger cars & utility vehicles

Commercial Vehicles

Steering Components

Plant spread across in an area of 2,25,000 sq.ft., Capacity to produce 3.2 million shock absorbers and struts and 0.3 million front forks
December13
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EAP Key Customers

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Industry
The Indian auto component industrys turnover at US$ 40.6 billion in 2012-13 Exports were at US$ 9.3 billion in 2012-13

Projected -US$ 115 billion in 2020-21

Projected-US$ 30 billion in 2020-21

Industry estimated to grow at a CAGR of 14% till 2020

Export Destinations
Asia

1.2 million additional jobs & 3.6% of total GDP contribution (from 2% in 2011-12) by 2020
South America 1 4 9 Australia Africa

25

26 North America

Demand for luxury & premium cars, higher disposable income would help sustain the auto component industry growth

35

Europe

Source: ACMA

December13

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Our Approach
AMBITION
HISTORY CURRENT ASPIRATIONS

Leading auto suspension manufacturer

Focus on 2W/3W shock absorbers

Focus on high end Shox for PV/CV

GUIDING PHILOSOPHY
Optimum mix of OEM, After Market and Export Exposure

Cost Discipline

Expand International Presence

Focused Product Offerings

December13

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Financial Highlights
Headquarters Initial public offering Workforce* FY12 Earnings Revenue Net Profit EV/EBIDTA 12M FY13 Earnings Revenue Net Profit EPS Market Share tractors Book Value Per Share Faridabad, Haryana, India 1991 (BSE and NSE(India)) ~ 8500 INR 3,894 Crore (USD 634.2 mn) INR 69.6 Crore (USD 11.3 mn) 6X INR 4,149 Crore (USD 675.7 mn) INR 167.6 Crore (USD 27.3 mn) 14.05 11.1% 145.61 *Direct + Indirect workforce
1 USD = 61.4 INR Page 21

Escorts Limited has extended its financial year by 6 months i.e. up to 31st March 2014 as approved by the Board of Directors in their meeting held on 2nd October 2013. The results reported are for 12 months ended 30th September 2013.

December13

Escorts Ltd.

Escorts Limited Financials

Profitability
Rs Cr Turnover 4,149.0 EBIDTA
EBIDTA
300.0

% to revenue

264.5 182.2

7.0%

6.0%

250.0

5.0%

200.0

3,893.9

4.0%

150.0

3.0%

100.0

6.4% 4.7% FY12 12M FY13

2.0% 1.0%

50.0

0.0%

FY12 EBT
EBT
200.0 180.0

12M FY13

EPS
% to revenue

14.05 183.0
5.0%

4.5%

160.0

4.0%

140.0

3.5%

120.0

100.0

87.9 4.4% 2.3% FY12 12M FY13

3.0%

5.84

2.5%

80.0

2.0%

60.0

1.5%

40.0

1.0%

20.0

0.5%

0.0%

FY12
Escorts Ltd.

12M FY13
Page 22

December13

Escorts Limited Financials

Particulars Revenue Material Cost
% to Revenue

12M Sept'12 3,893.9 2,844.5

73.1%

12M Sept'13 4,149.0 2,963.1

71.4%

Turnover up by 6.6%

Employee Cost
% to Revenue

406.1
10.4%

441.6
10.6%

Other Expenses
% to Revenue

461.0
11.8%

479.8
11.6%

Material Cost down by 1.6%

EBIDTA
% to Revenue

182.2
4.7%

264.5
6.4%

EBIDTA up by 169 bps at 6.4%

Other Income Exceptional Items Interest Depreciation EBT

% to Revenue

48.9 (1.7) 96.4 48.4 87.9

2.3%

54.5 0.8 81.7 53.5 183.0

4.4%

Finance Cost down by Rs. 15 crs.

TAX EAT
% to Revenue
December13

18.3 69.6
1.8%
Escorts Ltd.

15.5 167.6
4.0%

PBT up by 215 bps at 4.4%

Page 23

Segment Performance
FY12 Revenue 12MFY13 Revenue
ECE 12.43% EAP 3.59% ERP 4.23% EAM 79.76%

ECE 18.94%

EAP 3.62% ERP 3.76%

EAM 73.67%

December13

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Stock Market Info.

As on 02.12.2013
Shares Outstanding 12.26 Crs.

Current Market Price

Rs. 115.10

52 Week Low/High

Rs. 48.35/Rs. 125.35

Current Market Cap

Rs. 1,413.31 Crs.

December13

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Share Holding Pattern

As on 30th Sept 2013

Body Corporates, 7.34% DII's, 4.66%

Public & others, 33.76%

FII's, 12.27%

Promoters, 41.97%
December13
Escorts Ltd. Page 26

Recent Developments
The New Farmtrac Executive Series Tractors that are designed with help from a leading European engineering company.

The new Farmtrac Executive series tractors comes with new style, improved operator ergonomics, and a host of world-class features.
Powertrac Diesel-Saver Plus

The new Diesel-Saver Plus series enhances power of the current engines by about 10%, and at the same time reduces their fuel consumption by 10%.

December13

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Recent Developments
Glamour & Sophistication to the World of Tractors Ferrari Orchard Tractor a revolutionary new machine and a technology wonder, for the high value Orchard Farmers. All four equal-sized wheels. Oscillating chassis system All-time 4 wheel-drive. Front-engine mounting for super-low turning radius and an ideal weight distribution. Backhoe Loader offering has been strengthened: The new DigMax II series backhoe loaders are highly fuel efficient, more productive and exceptionally reliable machines packed with host of new exciting features like: Equipment monitoring system communicates with you through Voice messaging system in nearly 21 Indian languages as per customer preferences , FM & USB Infotainment system , Outrigger alarm, Two side Horn, Spacious all weather Cabin Etc.
December13
Escorts Ltd. Page 28

Recent Developments
International Launch of Tractors at Hannover AGRITECHNICA 2013 11th November
Going Global Strategy Escorts to focus on several new markets in the European region, Latin America and South Africa and provide the best of technology at an affordable price. The Company will further expand its current presence in ASEAN countries, Africa and pockets of Europe. The European markets in focus are Germany, UK, France, Turkey, Italy and Spain. Farmtrac Europe-line product range would cater to the high HP segment, i.e. up-to 110 HP. The USP of the product range is that it comes with world class components at a price structure at a

competitive price
Farmtrac Heritage product range would cater to sub 80 HP segment. The USP of this range would be its classic finish, which is simple yet highly efficient. The same Heritage series would be a great choice for small farms where in the use of a very large, sophisticated tractor cannot be justified.

December13

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Recent Developments
RT 40 Slew Crane 40T Class 4 wheel drive 4 Wheel Steer- Rough Terrain Crane

Ergonomically designed controls for smooth and precision

handling of loads

Haulage Tractor

M 1000 Multi loader

Safe Cranes

December13

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Recent Developments
Bogie Mounted Brake System (BMBS) Escorts-make BMBS is based on the floating concept of braking supported by the four-bar

mechanism concept. The system is designed for higher rigging efficiency and reduced number of
components, for achieving better brake force on all the wheels. The system is also equipped with Hand Brake Mechanism. Use in all types of Railway Freight Wagons of Axle load of 20.32 tonne and more such as BOBRN, BOBRNHS1M, BOXN, BOXNHL, BCN, BCNA

December13

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Page 31

Award & Achievements

Escorts Agri Machinery won the Rural Marketing Association of India Gold Awards

Escorts CIO wins top Information Security Award

Escorts was awarded the Star Performer Award in the two & three wheeler auto component category at the 44th EEPC INDIA National Awards for Export Excellence
December13
Escorts Ltd.

Escorts received the Best Supplier award from Suzuki Motorcycles India for two consecutive years (2012 & 2013)
Page 32

Safe Harbor
Certain statements in this document may be forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties like regulatory changes, local political or economic developments, and many other factors that could cause our actual results to differ materially from those

contemplated by the relevant forward-looking statements. Escorts Limited will not

be in any way responsible for any action taken based on such statements and

undertakes no obligation to publicly update these forward-looking statements to

reflect subsequent events or circumstances.
December13
Escorts Ltd. Page 33

Escorts Limited | www.escortsgroup.com Email us @ investorrelation@escorts.co.in Corporate Centre | 15/5, Mathura Road, Faridabad 121003 +91-129-2564711, 2564921, 2564558