Eicher Motors 2020 Annual Report Takeaways!

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 Evolved into an “Experiential” Brand.

  • Owner of the iconic Royal Enfield brand, World’s oldest motorcycle brand in continuous production.
    • Market share in India’s mid-size motorcycles (250-750 cc): 96%
    • Market share in India’s 125+ cc motorcycle market: 26.6%
    • 697,582 motorcycles sold (down 15% YoY)
    • Motorcycles – Classic, Bullet, Himalayan, Interceptor INT 650 and Continental GT 650
    • Ever-expanding Apparel & Accessories collection (12% of revenues)
    • Volume growth of 96%, in international markets which has been highlighted by overwhelming growth across all geographies (Future growth  story)
      • Export volume of 38,662 motorcycles, a 96% increase from 19,721 in 2018-19. 
      • Added 35 new stores across its international markets with a focus on Thailand, Brazil, Argentina, France and the UK, increasing its overall touchpoints to over 660 stores.
    •  launched an industry-first initiative – ‘Make Your Own (MYO)’. Customisation |
      • This initiative offers customers an opportunity to customise their motorcycles through an in-store 3D configurator
  • VE Commercial Vehicles (JV with Volvo group which owns 45.6%): Driving modernization in the commercial transportation industry.
    • Market share in India’s light & medium duty (3.5-15 tonnes) CV segment: 29.5%; increased share as the industry de-grew by 40% YoY.
    • 48,721 vehicles sold (down 33% YoY)
    • Eicher branded Light & Medium-duty trucks (4.9-15 tonnes), Heavy-duty trucks (16-55 tonnes) and buses (12-62 seats)+ Volvo Trucks.
    • First company in the Commercial Vehicle Industry to migrate to BS-VI norms
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  • Strong Balance sheet. (One of the few companies whose Annual Report starts with their Balance Sheet. Comes to explain why it has created so much wealth!)
    • Fixed assets have grown from Rs 1250 crs to Rs 2700 crs in the last 3 years 
    • Investments have grown from Rs 3200 crs to Rs 6800 crs
      •  Didn’t return the extra cash to shareholders rather conserved it to bear through slowdown & unseen crisis.
  • P&L account affected from the ensuing economic slowdown. Good cash flows.
  • Have a social media community of more than 7.5 million passionately engaged users as of March 2020, an increase of 30% YoY.
    • Launched geofenced websites in 3 more markets this year – Korea, Malaysia and Vietnam – taking our total website footprint to 21 countries now.
  • As the lockdown gradually begins to ease out, Witnessing strong initial customer interest and confidence.
    • Estimate an increased demand for personal transportation and two-wheelers as people would be wary of using public transport.
  • Such comments from experts on their new vehicles do inspire confidence.
  • The rising aspirations of youths in smaller towns and cities of India for leisure motorcycling have increased demand for Royal Enfield motorcycles.
  • Opened 600 studio stores in Tier 2/ 3 cities this year (1st timer in India)
    • Unique, compact stores spread across 500-600 sq.ft. 
    • Have the same retail identity as existing dealerships across cities along with the entire portfolio of motorcycles, service and spares.
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  • Share of motorcycle sales through financing improved from 51% in 2018-19 to 53% in 2019-20.
    • 5 major banks and Non-Banking Finance Companies (NBFCs) as its preferred financiers who have deployed dedicated manpower in its stores.
  • Things that show care for the customer: (other than fancy infographics.)
  • 4899 employees, Percentage decrease in remuneration: 5%; for management personnel: Increase of 25% (?)
  • All the top 10 institutional shareholders increased stake.

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JST Investments
JST Investments is a Mumbai-based investment firm that believes in long-term wealth creation. It's a brainchild of Aditya Kondawar, Aditya Shah, and Anish Moonka.
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