Management Interviews - NIIT Technologies, Mastek Ltd., Ashok Leyland, M&M, Bajaj Auto, Sterlite Technologies

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Annual Salary hikes comes in Q1 leading to depressed margins
Order intake for this quarter is $151 mn vs $110 mn YoY with US as lion’s share
US is now 50% of revenues vs 48%
Within BFSI, amount of spends coming from Capital markets subsegment to meet regulatory impediments are large

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As a result of our investments in last 18-24 months, we are seeing a good momentum in topline
Financial performance is a lag indicator, our pipeline have grown 25% QoQ, order book remains robust, we are signing multi year deals
More IT services will be needed to establish departments set out due to Brexit
Sequentially US grew 4.2% and 10% YoY. Investments in digital commerce space (Retail to Ecommerce) is where we are helping our customers
We have been in UK for 22 years and US for a year and a half
Margins trend will continue to have upward bias as we keep on investing and growin the business

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Taken price hike of 1.5-2% in April which helped us to neutralize increase in RM prices
In chase of volumes we are not going to do heavy discounting. We don’t push credit into pipe and try to take offtake higher
Net cash on books is 1200 crs
Its 12-13^th sequential quarter of double digit ebitda margins
Hopefully in 2^nd half of this year we can see softening of steel prices
Market share for current quarter is 30.2% for MHCV segment (fallen by 4.5%)
Gained market share in LCV segment from 15 to 16% -> 34% growth in volumes
We are clearly walking away from negative margins sales and let some of business go. For us it not a market share game, our plan is to grow profitably
8-10% growth at the end of the year is very much possible
Extra load in existing vehicles brings safety concerns as it will be overloaded; can be brought prospectively in new vehicles
Last quarter we saw heavy discounting by other players to play volume game

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Govt notifications on extra load cannot be applied retrospectively as we have designed vehicles as per earlier rules
Will have to design new truck for new axle load
It will take minimum of a year to design and make trucks to be able to leverage full axle capacity that govt has now approved

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Exports grown by 31% in totality
Domestic motorcycle grown by 40%
CV business grown by 80%
All in all grown by 36% in number terms
Had a record sales in international three wheelers, on track to achieve 2 million on export side
CV business – runrate of 100,000 coming per quarter, annual target of 375,000
Domestic motorcycle – Industry growth at 19%, we have grown at 34%
Margins at 18.4% vs 20% tradionally
CV and Exports have seen same margins
Domestic motorcycle is growing more in terms of topline so margins have come off on overall business
Will go in more aggressive in terms of pricing and market share for M1 segment (entry level) which forms 15% of turnover
Sports segment, 3 wheeler, Spare parts will continue with the same margins

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Sitting at all time high order book from 3100 cr to 6034 cr as on June 2018
As of the visibility today we are predicting $ 100 mn profit mark can be achieved by march 2019
Margins significantly improved from FY 16 to FY 17
One of our facilities which was operated at 45% utilization is now operated at 95% utilization
Overall operating efficiency is improving
24-25% margins is our medium term outlook (no expansion)
Metallurgica acquisition will help in Europe as a startegic hub and also brings in new set of customers. Will be EPS accretive immediately
Out of 6000 cr order book, 5000 cr is coming from products which is largely from european markets. Rest 1000 cr is system and software development

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Management Interviews – NIIT Technologies, Mastek Ltd., Ashok Leyland, M&M, Bajaj Auto, Sterlite Technologies