Kirloskar Oil Engines Ltd. Welcomes you to Analysts Meet. Pune, INDIA Aug. 14, 2003

Transcription

1 Kirloskar Oil Engines Ltd. Welcomes you to Analysts Meet Pune, INDIA Aug. 14, 2003

2 Presentation Outline Kirloskar Group Profile Kirloskar Oil Engines Ltd. (KOEL) Operational Philosophy August 14,

3 Kirloskar Group 1888 Beginning of Kirloskar Group 2003 We focus on a multitude of Engineering Businesses August 14, 2003 vijay.varma@kirloskar.com 3

4 Core Businesses & Values Trust Reliability TCO Resilience August 14,

5 Core Businesses & Companies Core Businesses Prime Movers and Transmission Automobile Components AC Generators Fluid Handling and Compression Metal Processing Companies Kirloskar Oil Engines Ltd. Kirloskar Pneumatic Co. Ltd. Kirloskar Oil Engines Ltd. Kirloskar Oil Engines Ltd. Kirloskar Brothers Ltd. Kirloskar Copeland Ltd. # Kirloskar Pneumatic Co. Ltd. Kirloskar Ebara Ltd. # Kirloskar Ferrous Industries Ltd. Kirloskar Oil Engines Ltd. # = Joint Ventures August 14, 2003 vijay.varma@kirloskar.com 5

6 Group Product Folio Products Volume FY03 Position in India FY98 FY03 Technology Pumps 120, Kirloskar. For any application Gas Compressors Air up to 10,000 cfm Refrigeration up to-400tr 1,100 1, Kirloskar. Sealed Compressors Air-conditioning and Refrigeration 350, Kirloskar and Copeland Corporation, USA Pig Iron 240,000 MT 2 2 Kirloskar & Tata Korf Iron Castings 18,000 MT 1 1 Kirloskar & George Fischer, Switzerland Diesel Engines 160, hp diesel engines, air and liquid cooled hp liquid cooled [2002 launch] hp diesel engines, liquid cooled Kirloskar Outsourced SEMT Pielstick Kirloskar Oil Engines Ltd. Auto Components Engine Bearings 35 M 1 1 Kirloskar Engine Valves 4 M August 14, 2003 vijay.varma@kirloskar.com 6

7 Kirloskar Oil Engines Ltd. (KOEL)

8 Quick View 1946 Beginning of KOEL 2003 Continued Range Expansion August 14,

9 KOEL at a Glance Year Of Establishment 1946 Plant 06 Sales Income FY03 INR 8,862 Mn Manufacturing Volumes Engines Auto Components 160, Mn Employees 1,850 ISO 9001Accredition Since March 1992 ISO (EMS) Since Nov 1999 Head Office & Main Plant Land Plant Pune 250,000 m 2 67,000 m 2 3 years ago, we employed over 2,600. August 14, 2003 vijay.varma@kirloskar.com 9

10 Our strength - The People Progressive policies for welfare, training development,multi-skilling, recognition and rewards, appraisals in place Continuous dialogue and communication at all levels for complete alignment with organizational objectives Exposure to best practices in the industry in India and abroad August 14, 2003 vijay.varma@kirloskar.com 10

11 FY03 Sales LEBG 8% Engine Sales SEBG 34% SEBG = Small Engines (up to 20 hp) MEBG = Medium Engines ( hp) LEBG = Large Engines ( hp INR 806 M MEBG 58% INR 6,315 M About 18% of Engine Sales is of Spares VALVES 15% Auto Component Sales About 40% of Bearings Sales is to OEMs BEARINGS 85% August 14, 2003 vijay.varma@kirloskar.com 11

12 Organisation Structure All controlled from Central Data Center at Pune that runs on Oracle ebusiness Suite. All Dealer and Supplier transactions are paperless from mid Businesses KOEL Pune, Ahmednagar, Nasik & Phursungi Auto Components Pune, Ahmednagar, Nasik Large Engines & Spares Nasik Small Engine & Spares Phursungi 17 Offices & 14 Depots Medium Engines & Spares Pune & Phursungi 9 Offices & 4 Depots Services Secretarial & Legal Pune Management Services Pune (HR, Personnel, IT_Corporate) Corporate Finance Pune Other Operations Pune August 14, 2003 vijay.varma@kirloskar.com 12

13 Engine Segment

14 Distributed Manufacturing Location Pune Nasik Phursungi Ahmednagar Indore Rajkot Activity Head Office Medium Engines ( hp) Large Engines ( hp) Engine Valves Small Engines (upto 20 hp) Engine Bearings Contract Manufacture - Small Engines (upto 20 hp) Contract Manufacture - Small Engines (upto 20 hp) August 14, 2003 vijay.varma@kirloskar.com 14

15 Awards & Certifications Quality Policy in place, since ISO 9001 certification since Golden Peacock, 1997 and Highest National Award for Design Innovation QS 9000 Certification for Engine Bearings, since Business to business e-commerce through webenabled Supply Chain, since 2000 ISO Certification for Environment Management System since August 14, 2003 vijay.varma@kirloskar.com 15

16 Widest Power Envelop The Smallest : 5 hp The Biggest : hp To August 14, 2003 vijay.varma@kirloskar.com 16

17 The Agri Presence Our sales to PTL and SEL in last two years are Rs. 962 M and 559 M respectively. The first KOEL engine, a 5 hp model, was manufactured for use in pumpsets in Over the years, the product range has expanded and diversified, but 3 hp to 20 hp engines for agriculture pumpsets and farm equipment continue as a significant product group. Over 3 M engines sold to date in 5-20 hp We supplied about 10,000 engines to Punjab Tractors in FY03, and till date over 450,000 engines are in active use on Tractors August 14, 2003 vijay.varma@kirloskar.com 17

18 The Industry Presence In the Industrial Market, we concentrate on Earth Moving, Construction and Material Handling Machinery. Leading Indian OEMs like JCB, Escorts, Ingersoll Rand, Larsen and Toubro, Atlas Copco and Bharat Earth Movers power their equipment with our diesels. On certain Equipments, such as excavator loaders, transit mixers and compactors, we hold 100% market share. Over 40,000 engines sold till date in Industrial Segment August 14,

19 The Power Presence Power Generation In the Power Generation Segment, Kirloskar Diesels are highly recommended by the Institutional Customers like Railways, Telecom, Defence etc. for Prime Power, Standby, Base Load, etc. Over 250,000 engines sold till date in 2.5 kva till 600 kva Power Bracket August 14,

20 Recent Product Development Developed 9-distinct engine models for Tractor Usage during last 24-months Developed Automotive Ratings of R1040 series conforming to Euro II for trucks CNG Engines under development Entire mid range now conforms to Central Pollution Control Board Emission norms, which are similar to US Tier II/CoM Stage II norms for Off-highway Usage August 14,

21 Market Presence Across Sectors Agriculture (Farm Goods) Industry Services Tractor Industrial Defence Pumps Offshore Railways Telecom Cellular August 14,

22 Product & Market Mix Products include : Diesel Engines in the Power Band 2.5~11000 hp Bearings, Valves Busines s Unit Small Engines Medium Engines Large Engines Power Output (hp) Cooling Market Segments Upto 20 Air/Water Farmer s Pumpsets, Agri Machinery, DG Sets Air/Water Water Water Agri Tractors, DG Sets, Industrial (Construction, Material Handling, Earthmoving, Fluid Handling, Mining, Agro_Industrial, Offshore, Defence Automotive) Power Plants & Marine August 14, 2003 vijay.varma@kirloskar.com 22

23 Indian Market Position Diesel Engines Small (up to 20 hp) Medium (20 120hp) ( hp) Large Engines ( hp) Market Share KOELs Position % % % % 2 2 August 14, 2003 vijay.varma@kirloskar.com 23

24 Competitors - Engines Small Engines ( up to 20 hp) Medium Engines (20 to 830 hp) Large Engines (2400 to 11,000 hp) No National Level player. Several Regional players from Agra, Kolhapur and Rajkot Cummins, Ashok Leyland, Simpson, and Greaves Wartsila and imports like MAN and Caterpillar August 14, 2003 vijay.varma@kirloskar.com 24

25 Market Reach Plant Location Market Segment Outlets/ Highlights Dealers Agri Pumpsets 1,100 Rural reach for sales & service Industrial OEMs 40 Over 70 OEM Installations DG Set OEMs 11 Focus on Industry Large Engines Direct Focus on Industry Sale Product Support 167 Effective & Efficient Service 20 Sales Offices and 16 Warehouses August 14,

26 Nationwide Spread 18 Area Offices, 22 Warehouses, and, 1,000 Dealerships August 14,

27 Product Support in India Retail Sale by OEMs and dealers Product Support by KOEL 167 Service Dealers of KOEL. Round-the-Clock Service in 42 cities, being extended. August 14,

28 Time Tested Customer Relationships Unmatched Customer Care is a Core Value! Punjab Tractors, Voltas, Godrej JCB, L&T-Case, IR 3-decades 2-decades Escorts, Greaves, Indfos 1-decade August 14, 2003 vijay.varma@kirloskar.com 28

29 Technology

30 Emission Compliance Engines designed in-house are certified to fulfill US Tier I emission norms for off-road usage, Euro II emission norms for on-road usage, with capability to upgrade to Tier II / Euro III. August 14, 2003 vijay.varma@kirloskar.com 30

31 Engine Families Customised For Tractors Sr No Parameter UoM 1R1600 2R860 2R1040 3R860 3R980 3R1040 4R1040 4R1040TA 1 Bore X Stroke mm 124 X X X X X X X X 120 Aspiration NA NA NA NA NA NA NA turbo after-cooled 2 No of cylinder Total displacement ltr Gross Power as per SAE Hp 25/ / / / / / / /2300 (kw) J 1995-JUNE (18.4) (17.7) (23.5) (26.5) (33.9) (37.2) (56) (73.6) 5 Back up torque Nm/rpm (%) 93/ / / / / / / / Gross SFC at Rated Speed g/hp.hr Smoke at ISO conditions (Correction as per BS AU 141) 8 Blowby (% of swept volume max) 9 Lub oil consumption (% of SFC) 10 Emission norms * HSU 40 HSU max till 1200 rpm lowest US TIER I/II norms NMHC + Nox 9.5 g/kw-hr Co 5.5 g/kw-hr PM 0.8 g/kwhr August 14, 2003 vijay.varma@kirloskar.com 31

32 The Brand-pull Exc-Loaders Compactors Fork-lift Trucks Excavators Assorted Cellular August 14,

33 Application Canvass [80-active Applications] August 14,

34 Strategy for Export Engines, Pumpsets, and Gensets Products are ready We focus on Africa and Middle East Setting up Sales and Service operations is the present focus August 14,

35 Demand Drivers - Engines

36 Small Engines farm economy drives the demand for the pumping units and other farm machinery demand for power generating sets is due to the prevalent power situation. Specially in semi-urban and rural areas August 14,

37 Medium Engines tractor industry is yet to come out of the slowdown though its long term prospects are good demand for the power generating sets is driven by the growth in services sector, and also investments in the industrial activity in general. Infrastructure building also results in demand for on site power. Lately, large homes and housing projects have started buying generating sets for standby power. demand for industrial, earth moving and construction machinery is driven by the investments in the infrastructure. August 14,

38 Large Engines demand for generating sets is driven by the state of the economy resulting in investments in process industry purchases by shipyards for ship building are directly related to the orders for ships from Navy and Coast Guard August 14,

39 Engine Family. Custom Built for Any Application and Climatic Conditions, may it be. Sun Moon Mountains Deserts Water August 14,

40 Auto Component Segment

41 Auto Component at KOEL Engine Valves Engine Bearings a bearing for every need August 14, 2003 vijay.varma@kirloskar.com 41

42 Share in Indian Market We have compete with Bimetal, Gabriel, Menon, and GMH in India. Ours is leading share of 35%.

43 Capability from Design to Delivery We make - Bearings, Bushings and Flanges We start from Powder and Billets manufacturing, to Strip manufacturing, ending with finished bearings Design capabilities - enhanced by engine design and development capability In-house capability to make bearing manufacturing machines and tooling August 14, 2003 vijay.varma@kirloskar.com 43

44 Example of machines we make World Class Bearings at competitive capital and operating costs August 14,

45 Wide ranging materials to cater to every need! ALUMINIUM TIN SILICON ALUMINIUM TIN COPPER LEAD WHITE METAL August 14,

46 Strategy for Export Engine Bearings and Engine Valves Products are ready Focus on securing OEM businesses August 14,

47 Drivers - Engine Bearings and Valves demand for Engine Bearings and Valves is driven by the growth of automobile manufacture in the country, and, specifically manufacture of engines in the country by the automobile companies August 14, 2003 vijay.varma@kirloskar.com 47

48 Manufacturing Philosophy

49 Strategic Direction Attain Cost Leadership through effective deployment of measures such as : Rationalisation of Supplier Base and getting them committed Increased Inventory Turns Rev up Operational Efficiencies Enhance Man-Machine Utilisation [Flexible setups, multi-skilling, QC, Kaizens] Instill Respect for Money across Stake-holders August 14, 2003 vijay.varma@kirloskar.com 49

50 Our Thrust Areas Reduce Number of Suppliers Reduce Material Inventory Reduce Working Capital Improve Productivity men, machines and money Reduce Shop Rejection Reduce Tool Cost Reduce Machine Maintenance Cost August 14,

51 Merger of KPSCO That is, Kirloskar Power Supply Company Ltd.

52 Merger of KPSCO KPSCO was in the business of generating power by using your company s large generating sets, and, was selling power to Industrial Units in Karnataka. It is now Power Division of KOEL. Provides us opportunity to demonstrate use of company s products in Independent Power Producer mode. Recent changes in the Electricity Act, expected to lead to entrepreneurs to set up business to generate and sell power in coming years. August 14, 2003 vijay.varma@kirloskar.com 52

53 Thank you! Vijay Varma Kirloskar Oil Engines Ltd., Pune Aug. 14, 2003