Sterling Tools Limited has informed the Exchange about Investor Presentation
PANKAJ GUPTADigitally signed by PANKAJ GUPTA DN: c=IN, st=Haryana, 2.5.4.20=91c20b2fcfe564fef4102e84306c7e087c1769bacee3205e2487502c4ec657a3, postalCode=122018, street=MAYFIELD GARDEN, SECTOR-47 , GURGAON , Gurgaon, pseudonym=555eab29ac1d4f98b016f433eaf886e2, serialNumber=21079ebe175ffdb60fd567a453f611c90c98a229ea5d09ad8cfc2fbb931cfc00, o=Personal, cn=PANKAJ GUPTA Date: 2023.02.01 18:24:28 +05'30' STERLING TOOLS LIMITED
Q3 & 9MFY23
t n e t n o C f o e b a T
l
01
Company Overview
3
Page No.
Q3 & 9M FY23
02
Q3 & 9M FY23 – Quarterly Highlights
18
03
Historical Financials
26
Company Overview
About Sterling Tools Limited (STL)
01
Pioneer with a Legacy Second largest automotive fastener manufacturer in India with a rich legacy of over four decades
03
Manufacturing Facilities Strategically located 4 manufacturing facilities- 3 in Faridabad (Haryana) and 1 in Kolar (Bangalore)
Product Portfolio Offers a comprehensive product portfolio consisting of Standard, Chassis, Special and Engine Fasteners
02
Marquee Clientele STL caters to an esteemed clientele across PVs, CVs, 2Ws, Construction and Farm Equipment segments
04
4
About Sterling Gtake E-mobility Limited (SGEM)
1
3
Partnership with Jiangsu Gtake Electric Company Ltd. which led to Sterling Gtake E-mobility Ltd. (SGEM)
2
Gtake is a technology leader in motor control units for electric and hybrid vehicles and has a dominant market share in the electric CV space in China
First mover advantage in application support, market development as well as product localization
4
Installed capacity of 3,00,000 MCUs; Facility expansion being planned to further enhance capacity
5
Our Mission, Vision and Goals
Vision
Mission
Goals
We provide reliable and superior quality auto components to
our customers by harnessing best-in-class manufacturing
practices, clean and green technology, entrepreneurial spirit,
and passion of our people
✓ Be the most trusted brand for our customers
✓ Maximize value for our shareholders
✓ Be respected in our community
✓ Bring pride to our people
✓ 360 Degree Vision
✓ Achieving Excellence
✓ Engineering to Perfection
6
Business Verticals
FASTENERS
•
•
•
•
STL is a premier producer of cold forged hi-tensile fasteners and supplies to all major auto OEMs
State of the Art manufacturing facilities to provide reliable and high-quality products
Diversified into multiple categories across Fasteners
Long standing relationship with customers over the last four decades
ELECTRIC VEHICLE
•
•
•
•
Sterling Gtake E-mobility Limited (SGEM) is a 100% subsidiary of STL through strategic partnership between STL and Jiangsu Gtake of Shenzhen (China)
EV is STL’s new growth engine wherein the Company has entered into this partnership for manufacturing of Motor Control Units (MCUs)
Strong Tech team of 30 members focusing on product development that has enabled STL to capture ~50% market share in high-speed scooter segment
The EV vertical is growing rapidly and has already become PBT positive within a short span of 2 years
7
History & Milestones
2004 Third Plant- Prithla (Palwal)
1982 - 1999 Customer Acquisition Swaraj Tractors Eicher Group Punjab Tractors Escorts Hero HMSI
Ashok Leyland Isuzu motors Maruti M&M Tata Motors
2020 Diversification to Electric Vehicle Components – under 100% subsidiary of Sterling Gtake E-Mobility Ltd. (SGEM)
2019
Fourth Plant Bangalore Plant
1979 Incorporation
1999 Second Plant- Wire drawing unit at Ballabhgarh (Faridabad)
1981 First Plant- DLF (Faridabad)
2022 • Fasteners
business has outgrown industry growth
• Substantial
growth in EV business
2021 SGEM secured an order worth Rs. 600 mn for MCUs from a leading Indian e2W OEM
8
Pan India Presence
1
2
4
MCU Manufacturing Plant - Faridabad
SGEM Tech Centre - Faridabad & Bangalore
Fasteners Manufacturing Plants - Faridabad, Ballabhgarh, Palwal & Bangalore
18 Warehouses at 14 Locations
Ahirabad
Ahmedabad
Altible
Bhiwandi
Faridabad (3 Locations)
Gurugram (3 Locations)
Mehsana
Nagpur
Nashik
Pithampur
Pune
Puzhal
Haridwar
Udham Singh Nagar
9
Board of Directors
Mr. Anil Aggarwal Chairman-cum Managing Director
38+ years of experience Expertise in Manufacturing, Project management, Administration, Product and Project development and Quality control for auto components
Mr. Atul Aggarwal Whole Time Director
34+ years of experience, Expertise in Marketing, Banking, Finance, Corporate Affairs, Information Technologies and Export Resources Management.
Dr. Triloki Nath Kapoor Director 50+ years of experience, Expertise in Administration, Management, Regulatory Compliances and Governance related issues. Ex- Vice Chancellor and Dean of Punjab University.
Mr. Chhotu Ram Sharma Director
Ms. Malini Sud Director
40+ years of experience, Expertise in Banking & Finance Ex- MD & CEO of Bank of Punjab Ltd.
35+ years of experience, Expertise in Corporate Laws Founder- Capex Legal.
Mr. Shailendra Swarup Director
Mr. Rakesh Batra Director
Mr. Jaideep Wadhwa Director
Mr. Akhill Aggarwal Director
50+ years of experience, Expertise in Corporate Law including International Law CEO- Swarup & company.
30+ years of experience, Expertise in Consulting and Strong knowledge in Regulatory Compliances Ex- EY Partner and National Leader Auto Sector.
30+ years of experience, Expertise in International Business Management, Auto & Industrial Component Industry Knowledge. Ex- MD in the Ingersoll Rand.
10+ years of experience, Expertise in Automobile business and other allied services related to the sector.
10
Awards & Recognition
Consistent Quality performer award from Ashok Leyland
Supply Chain award from Volvo Eicher Commercial Vehicle
Certificate of Appreciation from Daimler Truck for being a reliable Partner and achieving 100% delivery
11
Product Range - Fasteners
Nuts
Engine Fasteners
Bolts & Screws
Standard / Chassis Fasteners
Special Fasteners
Standards
12
About Motor Control Unit (MCU)
A Motor Control Unit ( is an electronic module that interfaces with the Motor as well as the Battery Pack to control the electric vehicle’s speed, acceleration and range based on the throttle input
MCUs are one of the most important components of an EV and require a combination of power electronics, motor control algorithm and firmware expertise
In the absence of a VCU, the MCU also controls some basic vehicle level functionality
EV powertrain usually describes a sub system consisting of the motor, controller and gearbox/differential Some suppliers may also include the battery pack, the AC/DC and DC/DC convertors, the wiring harnesses and possibly the instrument cluster so as to provide a comprehensive solution for the entire electrical sub system
MCUs make up to 10% of electric two-wheeler cost
13
Product Range – Motor Control Unit (EV)
Product: D00
Application: Low Speed Scooter
Localization in CY23
Product: D06
Application: High Speed Scooter
Localized
Product: D03
Product: D04
Application: Performance Scooter & 3W
Application: Light Commercial Vehicles
Localized
Localization in CY23
Product: G05
Application: Passenger Vehicles
Localization in CY23
Product: G02
Application: Heavy Commercial Vehicles
In-house SMT lines for Board Population being planned
14
Key Clientele - Fasteners
r e g n e s s a P
s e l c i h e V
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a i c r e m m o C
s e l c i h e V
s t r o p x E
m r a F
t n e m p u q E
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STRONGHOLD
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s r e e e h W
1 - R E I T
n o i t c u r t s n o C
Aftermarket: Strong Pan-India presence with 100+ Distributors
15
MCUs (EV)
SGEM is the sole supplier of MCU’s to India’s largest EV 2 wheeler manufacturer
SGEM has purchase orders from 14 EV OEM’s
More than 30 automotive electric vehicle original equipment manufacturers are in advanced stages of discussion with SGEM regarding their MCU requirements for different vehicle categories
16
Our Strategy Going Ahead
• To improve the overall product mix that is margin accretive
• To focus on value
added products which has complex engineering structures
• To enhance Technical
capabilities
• Focus on Green Technology
• To develop multiple new products and aspire to become a one stop shop for EV’s
• To explore inorganic
opportunities that fits into Sterling’s ecosystem
• To add new clients and expand into newer geographies
• To increase content
per vehicle
• To strengthen Supply
Chain
17
Q3 & 9M FY23 Quarterly Highlights
Business Highlights
We are delighted to share that the company has reported a robust revenue growth of 33% in 9MFY23 to Rs. 443 crores as compared to corresponding period last year. The growth was primarily driven by increase in content per vehicle, overall robust industry demand & parts SOB increase in select OEM’s.
The EV theme is the next big thing in the industry and we are well positioned to expand out footprint in that vertical. Our EV business has increased substantially in the last 9 months which demonstrates our capabilities and strength to venture into new areas. The turnover in this vertical touches Rs. 119 crores in 9MFY23 as compared to Rs. 7 crore in 9MFY22.
We continue to focus on increasing sales in the EV vertical by catering to new OEMs, developing new products and sharpening our engineering capabilities. This strategy will enable the company to expand its footprint and grab market share.
19
Industry Highlights
Passenger Vehicles
• The passenger vehicles reported a 31% growth in 9MFY23 as compared to 9MFY22 • The growth is mainly attributed to robust festive demand, new launches and adequate supply of vehicles
Two-wheeler
• The two-wheeler vertical registered a 13% growth YoY between April – December 2022 • The rural demand is sluggish and there is a possibility of an uptick in the overall two-wheeler sales in Q4FY23
Commercial Vehicles
• The CV segment witnessed a robust growth of 40% in 9MFY23 against same period last year • The overall demand for CVs improved largely due to pick up in road construction projects, cement consumption and fleet utilization levels
EV Two-wheeler
• There is a significant buzz in electric vehicles with electric two-wheelers witnessed a sales growth of 196% YoY to 2.20 Lakh units during 9MFY23 • The government of India has a significant thrust on EV segment wherein it is beneficial to both; the industry and customers at large
Source: SIAM, Industry Reports
20
y l r e t r a u Q
e c n a m r o f r e P
3 2 Y F D T Y
e c n a m r o f r e P
Key Financial Highlights For Q3 & 9MFY23 - Standalone
TOTAL INCOME
EBITDA
PBT
151.8
116.1
15.1%
17.6
15.7%
23.8
9.1%
13.9
8.0%
9.3
5.7%
6.6
Rs. in Crs
PAT
6.6%
10.1
Q3FY22
Q3FY23
Q3FY22
Q3FY23
Q3FY22
Q3FY23
Q3FY22
Q3FY23
TOTAL INCOME
EBITDA
PBT*
444.8
335.2
16.3%
54.8
16.0%
71.2
8.9%
29.7
9.4%
41.8
PAT
8.1%
36.2
6.6%
22.1
9MFY22
9MFY23
9MFY22
9MFY23
9MFY22
9MFY23
9MFY22
9MFY23
Margin
*PBT for 9MFY23 includes exceptional items of Rs. 6.7 crore
21
y l r e t r a u Q
e c n a m r o f r e P
3 2 Y F D T Y
e c n a m r o f r e P
Key Financial Highlights For Q3 & 9MFY23 - Consolidated
TOTAL INCOME
EBITDA
PBT
208.5
122.5
13.8%
28.7
13.7%
16.8
8.9%
18.5
6.5%
8.0
Rs. in Crs
PAT
6.7%
13.9
4.5%
5.5
Q3FY22
Q3FY23
Q3FY22
Q3FY23
Q3FY22
Q3FY23
Q3FY22
Q3FY23
TOTAL INCOME
EBITDA
PBT*
562.2
342.5
15.1%
51.6
13.7%
77.0
8.3%
46.6
7.5%
25.7
PAT
7.1%
40.1
5.4%
18.7
9MFY22
9MFY23
9MFY22
9MFY23
9MFY22
9MFY23
9MFY22
9MFY23
Margin
*PBT for 9MFY23 includes exceptional items of Rs. 6.7 crore
22
Well Diversified Revenue Mix
Fasteners Business
EV Business
Channel-wise Mix – 9MFY23
Segment-wise Mix – 9MFY23
Segment-wise Mix – 9MFY23
11%
2%
87%
OEM Exports Replacement
2%
11%
2%
24%
17%
21%
23%
PV 2W CV Farm Equipment & Off Road
Retail Exports Others
1% 1%
98%
2W
3W
LCV
2323
Profit and Loss Statement - Standalone
Particulars Revenue from Operations
Other income
Total Income
Cost of Goods Sold
Gross Profit
Gross Profit Margin
Employee benefit expense
Other expenses
EBITDA
EBITDA Margin
Depreciation and amortisation expenses
EBIT
EBIT Margin
Finance costs
Exceptional item
Profit before tax
Profit before tax Margin
Tax
Profit after tax
Profit after tax Margin
EPS (in Rs.)
Q3FY23 Q3FY22 YoY (%) Q2FY23 QoQ (%) 9MFY23 9MFY22 YoY (%) 33.0%
151.3
115.5
442.6
332.8
153.9
31.1%
-1.7%
0.6
0.8
116.1
30.8%
154.7
-1.9%
0.5
151.8
64.7
87.1
44.8
71.3
57.4%
61.4%
11.1
28.3
23.8
10.5
22.5
17.6
15.7%
15.1%
7.7
16.1
10.6%
2.2
-
13.9
9.1%
3.8
10.1
6.6%
2.80
6.7
10.9
9.4%
1.6
-
9.3
8.0%
2.7
6.6
5.7%
1.83
35.2%
49.4%
52.9%
60.1
94.6
61.2%
11.1
30.5
25.8
16.7%
7.8
18.0
11.6%
2.1
6.7
22.7
14.7%
5.4
17.2
11.1%
4.78
-7.9%
-38.8%
-41.4%
2.3
444.8
180.7
264.2
59.4%
33.7
84.5
71.2
2.4
335.2
128.4
206.8
61.7%
32.0
63.7
54.8
16.0%
16.3%
23.3
47.9
20.1
34.7
10.8%
10.4%
6.1
6.7
48.6
10.9%
12.4
36.2
8.1%
10.04
5.0
-
29.7
8.9%
7.6
22.1
6.6%
6.14
32.7%
30.0%
63.6%
63.5%
Rs. in Crs
24
Profit and Loss Statement - Consolidated
Particulars Revenue from Operations
Other income
Total Income
Cost of Goods Sold
Gross Profit
Gross Profit Margin
Employee benefit expense
Other expenses
EBITDA
EBITDA Margin
Depreciation and amortisation expenses
EBIT
EBIT Margin
Finance costs
Exceptional item
Profit before tax
Profit before tax Margin
Tax
Profit after tax
Profit after tax Margin
EPS (in Rs.)
Q3FY23 Q3FY22 YoY (%) Q2FY23 QoQ (%) 9MFY23 9MFY22 YoY (%) 64.7%
16.4%
70.4%
207.8
178.6
340.2
560.3
122.0
0.5
0.5
122.5
70.2%
179.1
16.4%
0.6
208.5
110.5
97.9
50.9
71.6
47.0%
58.5%
12.9
32.3
28.7
11.3
22.9
16.8
13.8%
13.7%
7.9
20.8
10.0%
2.3
0.0
18.5
8.9%
4.6
13.9
6.7%
3.86
6.8
10.0
8.2%
1.7
0.0
8.0
6.5%
2.5
5.5
4.5%
1.52
71.1%
131.1%
154.9%
80.5
98.7
55.1%
12.5
33.3
25.6
14.3%
8.0
17.6
9.8%
2.4
6.7
21.9
12.2%
5.3
16.6
9.3%
4.61
12.3%
-15.8%
-16.2%
1.9
562.2
277.7
284.5
2.4
342.5
135.3
207.3
50.6%
60.5%
38.1
94.2
77.0
34.1
65.1
51.6
13.7%
15.1%
23.8
53.2
9.5%
6.6
6.7
53.3
9.5%
13.2
40.1
7.1%
11.13
20.2
31.4
9.2%
5.1
0.0
25.7
7.5%
7.0
18.7
5.4%
5.18
64.1%
49.2%
108.0%
115.0%
Rs. in Crs
25
Historical Financials
Key Ratios
Debt / Equity (x)
Current Ratio (x)
Networth (Rs Cr)
Fixed Asset Turnover (x)
0.31
0.30
0.29
2.05
2.09
2.15
1.89
309
335
363
386
1.49
1.22
1.22
0.17
0.88
FY20
FY21
FY22
H1FY23
FY20
FY21
FY22
H1FY23
FY20
FY21
FY22
H1FY23
FY20
FY21
FY22
*H1FY23
Debt / Equity (x)
Current Ratio (x)
Networth (Rs Cr)
Fixed Asset Turnover (x)
0.32
0.31
0.30
2.10
2.00
2.10
1.90
307
332
356
379
1.64
1.25
1.25
1.14
0.18
l
e n o a d n a t S
d e t a d
i l
o s n o C
FY20
FY21
FY22
H1FY23
FY20
FY21
FY22 H1FY23
FY20
FY21
FY22
H1FY23
FY20
FY21
FY22
*H1FY23
Dividend paying from last 2 decades
*H1FY23 data is not annualised
27
Previous Annual Results
Financial Year
PDF Link
FY22
FY21
FY20
FY19
28
Safe Harbor Statement
This presentation and the accompanying slides (the "Presentation") have been prepared by Sterling Tools Ltd (the "Company") solely for
informational purposes and do not constitute an offer, recommendation, or invitation to purchase or subscribe for any securities, and shall not
serve as the basis for any contract or binding commitment.
No offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about
the Company.
This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company
makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness,
fairness and reasonableness of the contents of Presentation.
This Presentation may not this be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of
the contents of, or any omission from, Presentation is expressly excluded.
The Company’s actual results, levels of activity, performance or achievements could differ materially and adversely from results expressed in or
implied by this Presentation. The Company assumes no obligation to update any forward – looking information contained in this presentation.
Any forward – looking statements and projections made by third parties included in this Presentation are not adopted by the Company and the
Company is not responsible for such third party statements and projections.
29
Company :
Investor Relations Advisors :
For further information, please contact
Sterling Tools Limited
CIN: L29222DL1979PLC009668
CIN: U74140MH2010PTC204285
Mr. Pankaj Gupta (Chief Financial Officer) / Mr. Abhishek Chawla (Manager – Legal & Secretarial) pankaj.gupta@stlfasteners.com / abhishekc@stlfasteners.com +91 (0) 129 – 227 0621/25
Mr. Karan Thakker / Mr. Aakash Mehta karan.thakker@sgapl.net / aakash.s.m@sgapl.net +91 81699 62562 / +91 98706 79263
www.stlfasteners.com
www.sgapl.net