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Eicher Motors Ltd

BSE Code : 505200 | NSE Symbol : EICHERMOT | ISIN:INE066A01021| SECTOR : Automobile |

NSE BSE
 
SMC down arrow

2,536.70

-13.60 (-0.53%) Volume 280564

27-Nov-2020 EOD

Prev. Close

2,550.30

Open Price

2,569.00

Bid Price (QTY)

-/-()

Offer Price (QTY)

-/-()

 

Today’s High/Low 2,617.50 - 2,518.40

52 wk High/Low 2,724.90 - 1,246.00

Key Stats

MARKET CAP (RS CR) 69317.06
P/E 57.37
BOOK VALUE (RS) 318.1192464
DIV (%) 1250
MARKET LOT 1
EPS (TTM) 44.22
PRICE/BOOK 7.97405384523758
DIV YIELD.(%) 0.49
FACE VALUE (RS) 1
DELIVERABLES (%) 22.89
4

News & Announcements

24-Nov-2020

Eicher Motors Ltd spurts 3.34%, rises for third straight session

23-Nov-2020

Eicher Motors Ltd - Compliances-Reg. 39 (3) - Details of Loss of Certificate / Duplicate Certificate

20-Nov-2020

Eicher Motors Ltd - Eicher Motors Limited - Analysts/Institutional Investor Meet/Con. Call Updates

19-Nov-2020

Eicher Motors hits 52-week high; rises 30% in thirteen days

02-Nov-2020

VE Commercial Vehicles sales volumes grows 11.9% in October

30-Oct-2020

Eicher Motors schedules board meeting

01-Sep-2020

Eicher Motors sells 50,144 motorcycle units in August 2020

13-Aug-2020

Eicher Motors grants 600 stock options under ESOP

Corporate Actions

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Financials

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Peers Comparsion

Select Company Name BSE Code NSE Symbol
Hero MotoCorp Ltd 500182 HEROMOTOCO
TVS Motor Company Ltd 532343 TVSMOTOR
TVS Suzuki Ltd (Merged) 500424 TVSSUZUKI

Share Holding

Category No. of shares Percentage
Total Foreign 78734854 28.82
Total Institutions 27168184 9.94
Total Govt Holding 397480 0.15
Total Non Promoter Corporate Holding 1206716 0.44
Total Promoters 134564270 49.25
Total Public & others 31157646 11.41
Total 273229150 100
  • Total Foreign
  • Total Institutions
  • Total Govt Holding
  • Total Non Promoter Corporate Holding
  • Total Promoters
  • Total Public & others

About Eicher Motors Ltd

Eicher Motors (EML) manufactures the iconic Royal Enfield brand of motorcycles, which leads the premium motorcycle segment in India. Royal Enfield is the oldest motorcycle brand in continuous production world-wide since 1901. Royal Enfield's product line-up includes the Bullet, Classic and Thunderbird models in 350cc. EML's 50-50 joint venture with the Sweden's AB Volvo , VE Commercial Vehicles Limited (VECV), designs, manufactures and markets reliable, fuel-efficient trucks and buses is one of India's leading manufacturer of trucks,buses, engines and engineering components. VECV has a wide product range from 5t to 40t GVW trucks and 15 to 65 seater buses. The buses are sold under the Skyline and Starline brands. Eicher Motors Ltd was incorporated in the year 1982. The company in technical collaboration agreement with Mitsubishi Motor Corporation of Japan produced the Light Commercial Vehicle in India. The commercial production as commenced in their plant at Pithampur in Madhya Pradesh, with the launch of Canter truck in June 1986. The agreement with Mitsubishi ended in March 1994 after successful transfer of technology and achieving total Indigenization. The demerger of Tractors, Two-Wheelers, Engines and Gears businesses from Eicher Ltd was transferred to the company with effect from April 1, 2003. In May 25, 2005, the company acquired 100% of the shares of Design Intent Engineering Inc, USA, which is engaged in the business of providing computer aided engineering & design services for a consideration of USD 2.5 million. The company's Tractor division at Mandideep, Gears division at Parwanoo and Engines division at Alwar had been sold to TAFE Motors and Tractors Ltd, a wholly owned subsidiary of Tractors and Farm Equipment Ltd, for a consideration of Rs 310 crore with effect from June 1, 2005. The company acquired a transmission gear manufacturing plant at Dewas having a gear cutting capacity of 5 lacs gears per annum with effect form November 1, 2006. During the year 2006-07, the company acquired the 100% equity shares of Hoff and Associates (Hoff), Plymouth, Michigan (USA) along with Hoff's two wholly owned subsidiaries in Beijing and Shanghai, China for a consideration of USD 3.5 million. In order to synergize the activities between the two subsidiary companies in USA, Hoff and Associates merged with Design Intent Engineering Inc with effect from January 1, 2008 and the name of Design Intent Engineering Inc was changed to Eicher Engineering Solutions Inc. In May 2008, the company signed a definitive agreement with Aktiebolaget Volvo, Sweden for a formation of a joint venture company through transfer of the existing Commercial Vehicle Business along with related Components and Design Services Business. In August 2008, they transferred the Components and Design Services Business to VECV, the joint venture company with effect from July 01, 2008. On 11 June 2010, VE Commercial Vehicles (VECV) announced an investment of Rs 288 crore in its Pithampur, Madhya Pradesh plant for the production and final assembly of the Volvo group's new global medium-duty engine platform. On 12 July 2011, Eicher Motors announced that it has been allotted land government at the SIPCOT Industrial Growth Centre, Oragadam by the Tamil Nadu state for building a new plant for the manufacture of Royal Enfield motorcycles. On 30 April 2013, Royal Enfield announced that it had started commercial production from its new manufacturing facility at Oragadam, Tamil Nadu. In July 2012, Eicher Motors signed an equal joint venture with Polaris Industries Inc. to set up a greenfield project. EML's joint venture with Polaris Industries Inc.- Eicher Polaris Private Ltd (EPPL) launched Multix- a new 3-in-1 vehicle for the independent businessman in June 2015. In December 2013, VECV's Eicher Trucks and Buses division (ETB) launched the future of Indian trucking with the introduction of its 'Pro series' range of trucks and buses ranging from 5-49 tonne. In February 2015, Royal Enfield started retail operations in Colombia with the opening of two exclusive stores in Bogota and Medellin. In May 2015, Royal Enfield acquired Harris Performance, a motorcycle engineering and design firm based in UK. On 24 August 2015, Royal Enfield announced its entry in Indonesia at GAIKINDO Indonesia International Auto Show (GIIAS) 2015. Royal Enfield opened its first exclusive store in Jakarta in January 2016. In December 2015, Royal Enfield announced its entry in Thailand at the Thailand International Motor Expo in Bangkok. In June 2016, Royal Enfield announced its tie-up with Flipkart, India's largest e-commerce marketplace to sell Royal Enfield gear and accessories. Royal Enfield opened its flagship store in Milwaukee, North America in September 2016. Two exclusive stores were also added in Europe in October 2016, one each in Barcelona and Valencia in Spain. On 18 March 2017, VE Commercial Vehicles Limited announced that it had divested 100% shares of its wholly owned subsidiary Eicher Engineering Solutions Inc in United States of America (USA) to SegulaTecnologias Espana, S.A.U., a Spanish corporation. The total enterprise value of the deal was pegged at $1,852,000. In August 2017, EML commenced commercial production of motorcycles at its third manufacturing facility at Vallam Vadagal near Chennai. In September 2017, Royal Enfield launched two variants of its bestselling motorcycle model, Classic - Stealth Black in 500cc and Gunmetal Grey in 350cc with a contemporary and stylish matt finish. In October 2017, Royal Enfield forayed into Vietnam, the fourth biggest motorcycle market in the world, and opened its first store in Ho Chi Minh City. In November 2017, Royal Enfield unveiled its ground-up modern twin motorcycles the Interceptor INT 650 and the Continental GT 650 at the EICMA Motor Show, Milan, Italy. In November 2017,the company opened the Garage Cafe in Goa. Reflecting the motorcycling way of life', the 120-seater Garage Cafe on the banks of the Baga River in Baga, Goa offers a relaxed, unhurried experience and is conceptualised to be an inclusive, engaging space. The Garage Cafe is a one-of-itskind format that is an amalgamation of the various dimensions of Royal Enfield. The cafe houses a motorcycle museumand- exhibition area, an exclusive gear store, a motorcycle customisation area and a service bay. During 2017-2018, the company in an effort to allow easier discovery and access to preowned Royal Enfield motorcycles, introduced first pre-owned motorcycle store - Vintage - in Chennai. A pioneering initiative in the two-wheeler industry, Royal Enfield Vintage will deal exclusively in pre-owned, refurbished and restored motorcycles offering hassle-free sale and purchase experience to consumers. The company also added 150 new dealerships in India taking the total retail outlet strength to 825 exclusive stores in the country, making the company the strongest premium motorcycle distribution in the country by a large margin. In June 2018, the company introduced the limited edition Pegasus at the Imperial War Museum in Duxford, U.K. Inspired by the RE/WD motorcycle, lovingly known as the Flying Flea, which played a pivotal role in World War 2, only 1,000 motorcycles were available across the world. The company sold all the 250 motorcycles meant for India in just 178 seconds via an online sale!. The company also successfully introduced Anti-lock Braking Systems (ABS) on all our motorcycles, well ahead of the regulatory deadline, starting with the Signals, inspired by our long association with the Indian armed forces. During 2019-2020 under review,The companies flagship business Royal Enfield sold 6,97,582 motorcycles and in an effort to increase the retail footprint in India and to cater to smaller towns and cities, Royal Enfield announced the Studio Stores format and launched 600 new Studio Stores during the year. These, together with the 921 dealerships, take Royal Enfield's retail touchpoints to 1,521 across India. The company also also launched new variants of the Royal Enfield Bullet 350 and the Classic 350 during the year, to further enhance accessibility for consumers. In addition to the BS VI compliant Classic 350, Bullet 350, the 650 Twin motorcycles, Royal Enfield also launched the BS VI Himalayan in the fourth quarter of the fiscal year. The Himalayan BS VI has a vibrant new look and improved features that have made it instantly successful in India and across the world. The new motorcycle has received great reviews from media, experts and from consumers. In the international markets, the company now has 77 exclusive stores outside of India, and a retail network spread across 60 countries. The company has opened new consumer touchpoints in Thailand, Brazil, Argentina, France and the UK, taking our total dealer touchpoints in international markets to over 660 stores including multi-brand outlets. Royal Enfield expanded its retail footprint in the Asia-Pacific region during 2019-20 by setting up its first standalone, flagship store in Seoul, South Korea. During the year under review, the company completed the set-up of our Global Headquarters in Chennai which also houses a world-class product development and technology centre.

Eicher Motors Ltd Chairman Speech

Dear Shareholders,

I trust you and your families are safe and doing well.

I am writing to you at a time when the world, as we know it, is changing. Over the last few months, the Coronavirus global pandemic and the ensuing emergency have resulted in disruptive changes in our world. We've seen a paradigm shift in the way we live, the way we work, and in the way we connect, engage and collaborate with people.

At the Eicher Group, we've moved swiftly to tackle and respond to this situation and we have taken several initiatives to secure the interests of our internal and external stakeholders. We employed a three-pronged strategy to address and engage all stakeholders outside our fences, close to our fences and within our fences. We worked to ensure our commitment and support to our dealers and suppliers, and helped them with over Rs. 700 crores, as we believe that we need to ensure the sustainability of the entire ecosystem. We have made an initial CSR commitment of Rs. 50 crores towards relief and support measures to fight the pandemic in India and are committed to increasing spends to deploy additional support and for longterm rehabilitation in the aftermath of the pandemic.

Businesses have been impacted too, and the automobile industry in India and across the world has been considerably hit. At Eicher Motors - both at Royal Enfield and VECV - we have witnessed the impact of this situation as several parts of the world, including India went into lockdown.

Our manufacturing facilities and offices remained shut in compliance, and so did our stores and service centres.

We believe we have built our business on sound fundamentals that gives us enough room to tackle unprecedented situations such as this. We have a solid balance sheet and cash position, a robust business model with a very focussed and cash- optimized approach, a strong line-up of excellent products, among the best retail footprint, and overall an exceptional management team at Royal Enfield and VECV. I am confident that we are able to pursue our focus and investment for the long term, while we address near term challenges.

ROYAL ENFIELD

In the year ended March 2020, EML's consolidated net revenue from operations (reflecting the business of Royal Enfield motorcycles) was Rs. 9,154 crores, Consolidated EBITDA was Rs. 2,180 crores, and Profit After Tax was at Rs. 1,827 crores.

Royal Enfield sold 6,97,582 motorcycles in the financial year.

In an effort to increase the retail footprint in India and to cater to smaller towns and cities, Royal Enfield announced the Studio Stores format and launched 600 new Studio Stores during the year. These, together with the 921 dealerships, take Royal Enfield's retail touchpoints to 1,521 across India. In the international markets, we now have 77 exclusive stores outside of India, and a retail network spread across 60 countries.

We have opened new consumer touchpoints in Thailand,

Brazil, Argentina, France and the UK, taking our total dealer touchpoints in international markets to over 660 stores including multi-brand outlets.

On the back of a challenging year, growth momentum for the automobile industry was sluggish and subdued. At Royal Enfield, we continued to push ahead with our long-term plans, while adapting our strategies to tackle immediate challenges.

We remained focussed on creating more accessibility with the introduction of new variants of motorcycles and on building engaging experiences for the customer.

It has been our constant endeavour to strengthen Royal Enfield's position as a true global brand, and as a catalyst for pure motorcycling. In that context, it is a great pleasure for me to report that we have had an excellent performance in markets outside of India this year.

We have recorded an overall volume growth of 96%, in international markets which has been highlighted by overwhelming growth across all geographies - both developing markets and matured markets have performed exceedingly well, with Europe registering a 100% growth over last year. The 650 Twin motorcycles, and the Himalayan have led this growth for us across these markets, as these gorgeous motorcycles received unprecedented response from consumers across the globe.

Royal Enfield expanded its retail footprint in the Asia-Pacific region this year by setting up its first standalone, flagship store in Seoul, South Korea. The overall footprint grew by 50% in key priority markets across the Asia-Pacific region. Royal Enfield now features among the Top 5 brands, in terms of volumes, in the middleweight segment in Thailand, Australia-New Zealand and South Korea. In Europe, we are now at No.6 among brands in the middleweight motorcycling segment. This year, we also started direct operations of our Thailand subsidiary. This will be instrumental for us to grow the Royal Enfield brand and the middleweight motorcycling segment in the Asia-Pacific markets.

We have continuously worked to strengthen our technical competencies. This year, we completed the set-up of our Global Headquarters in Chennai which also houses a world-class product development and technology centre. We now have the advantage of twin technology centres in the UK and in India, that house world-class testing and development capabilities and work in close collaboration across projects.

Our focus this year in India, has been to build accessibility and aspiration among emerging markets within the country. With

this view, we launched the Royal Enfield Studio Stores this year. These are smaller format stores, with leaner investment that gives us presence across smaller towns and cities in India. We opened 600 Studio Stores across India taking our overall consumer retail touchpoints to 1,521. We also launched new variants of the Royal Enfield Bullet 350 and the Classic 350 during the year, to further enhance accessibility for consumers.

This was a landmark year for the Indian automobile industry, as everyone transitioned to the new emission norms. At Royal Enfield, we ensured complete BS VI compliance across our portfolio much ahead of the mandated timelines. I am also very happy to report that we were among the first automotive companies in India to successfully sell all existing inventory of BS IV motorcycles before time. Astute production planning and close collaboration with the retail network made this possible.

In addition to the BS VI compliant Classic 350, Bullet 350, the 650 Twin motorcycles, Royal Enfield also launched the BS VI Himalayan in the fourth quarter of the fiscal year. The Himalayan bS VI has a vibrant new look and improved features that have made it instantly successful in India and across the world. The new motorcycle has received great reviews from media, experts and from consumers.

The single-cylinder, 500cc Unit Construction Engine has been an iconic part of Royal Enfield's heritage. In January this year, we bid adieu to the 500cc UCE platform with a special Classic 500 Tribute Black edition. These motorcycles were the last in India to carry the iconic long-stroke single cylinder UCE 500cc engine and were exclusively made to order in a limited production run, that saw great response.

Over the last year, the 650 Twin motorcycles have brought in a lot of first time buyers into Royal Enfield. In Europe, both motorcycles were very well received by riding enthusiasts. The Interceptor INT 650 and the Continental GT 650 continued to win many accolades and awards globally. The list of prestigious awards include - Thailand Bike of the Year 2019 award in the 'Best Modern Classic MiddleWeight' category, 'Best LAMS Retro Award' in Australia and 'Best Roadster' award in Philippines, MCN Retro Bike of The Year 2019 in the UK for Interceptor INT 650 and 2019 best-looking Naked/standard Motorcycle of the year from Motorcyclist magazine USA for Continental GT 650.

Royal Enfield motorcycles have always been the ideal canvas for customization and over the last few years we have been focussing on making this an integral part of our brand's journey. The Royal Enfield Custom Programme was set up with a purpose of nurturing the spirit of self expression among the community and deepening engagement with motorcycling. This programme has seen significant forward thrust during this year, with several interesting collaborations and participation across iconic trade shows and festivals across the world. During the year 2019-20, our programme showcased 37 new Custom Builds across 11 countries with several new properties being launched.

Rider Mania 2019 was a vibrant and exciting event, as we had the best ever participation of around 8,000 Royal Enfield enthusiasts from across the world. We launched several new exciting initiatives, and significant among them was the launch of the Royal Enfield Slide School, the first demo of which was held at Rider Mania. The Slide School was launched in an endeavour to revive the culture of fun and engaging flat track racing. The first edition of the Slide School was held in February in Bengaluru and received wonderful response from all participants.

With a view to bring in newer formats of rides, Royal Enfield focussed on greater community inclusion and created new rides centred around customers' hobbies and interests. This year, the first edition of Astral Ride - a distinctive ride that combines the passion for astrophotography with the spirit of motorcycling

was conducted. We also conducted the first edition of the Himalayan Adventure - Rongbuk, a treacherous ride across three of the Everest Base Camps.

We began a new journey towards Sustainability this year with the #LeaveEveryPlaceBetter initiative, in an endeavour to promote sustainable tourism and transport, especially to more ecologically fragile regions. We want to be able to preserve pristine tourist destinations and restore and sustain delicate ecosystems, so that our generation and future generations can enjoy them responsibly. Our first steps in this programme have been towards encouraging riders to be wary of littering, mindful of plastic waste and leave every place they travel to, cleaner than they found it. This year, the Himalayan Odyssey and Rider Mania were conducted as a zero 'single-use-plastic' events. Participants in these rides and events were delighted about this initiative and acted as catalysts to spread the word further among their riding communities. In the years to come, we plan to introduce many such initiatives that will reflect our commitment to sustainability and towards our social mission and take the concept well beyond our riding community, to the larger tourism industry.

We continue our journey towards environmental and community led sustainability initiatives at our manufacturing locations. This year we focussed on building initiatives to strengthen our resolve towards sustainability and improving performance standards. We are making sure that we continue to remain water positive and have also facilitated groundwater replenishment and renovation of traditional water bodies near our facilities. In addition, to ensure more green cover, we have planted over 1000 trees around our manufacturing locations.

Royal Enfield has the largest, the fastest growing and most engaged online motorcycle brand community in the world.

We have a social media community of more than 7.5 million passionately engaged users as of March 2020, an increase of 30% from the last year. Our on-ground and on-line communities together make for a vibrant audience that share content and want to eagerly engage with the brand.

For the past few months, during the lockdown, we initiated several digital campaigns such as the #TripStory and the WhatsYourAdventure, with a focus to keep our audiences engaged through contextual campaigns. Our overall community participation levels, engagement levels and reach were at an all-time high, and Royal Enfield was reported the second Most Engaging Brand in India during the lockdown.

We also introduced a new version of the Royal Enfield website to deliver a superior user experience in terms of navigation and discoverability through a design that makes interaction a lot more intuitive. We launched geofenced websites in 3 more markets this year - Korea, Malaysia and Vietnam - taking our total website footprint to 21 countries now. We now also have an online configurator that allows a user to visualize the product with his or her preferred choice of accessories. This is truly a step forward in delivering a vastly superior and continuous customer experience.

I do believe that we are very well poised to expand and lead the middleweight motorcycling segment globally. We endeavour to build and grow the pure motorcycling way of life, and bring more and more people across the world to experience the joy of leisure motorcycling. Our international markets are beginning to show significant and sustainable growth trends on the back of motorcycles we have recently introduced - the Himalayan and the 650 Twin motorcycles - and we believe we have strong potential for further growing these markets for Royal Enfield.

We are committed to remain invested in these geographies and continue our efforts towards building a robust ecosystem of rides, events, and community so we can further mobilize more enthusiasts into experiencing Royal Enfield's pure motorcycling way of life.

The last few months have been challenging, but as the lockdown gradually begins to ease out, we are witnessing strong initial customer interest and confidence. Going forward, we do estimate an increased demand for personal transportation and two-wheelers as people would be wary of using public transport. This we believe will augur well for us and for the industry as a whole. At Royal Enfield, we continue to make concrete inroads to expand our retail network, while we further strengthen our supply chain and vendor ecosystem. With an aim to further build accessibility through a host of seamless digital solutions and a variety of financial solutions, we are confident of capitalizing on this demand as the situation stabilizes.

VECV

The commercial vehicle industry has been going through a very challenging time over the last year. The medium and heavy commercial vehicles segment was severely impacted during the year, and high discounting in the sector led to an impact on profitability. Apart from this, VECV also had to tackle challenges in retail finance availability, change in regulation leading to increase in payload, and the transition to new emission norms during the year.

For the year ended March 2020, VECV's total revenue from operations was Rs. 8,524 crores, EBITDA* was Rs. 415 crores and Profit After Tax was Rs. 58 crores. VECV sold 48,721 trucks and buses in the year and 28,383 Medium-Duty engines (88% of which were exported). VECV also exported 4,568 vehicles and began manufacturing trucks for the Indonesia and South African markets under the UD brand, where we think there's a significant growth potential. During the year, VECV has also been able to improve its market share position across segments. While the industry witnessed a decline of 40%, VECV was in a better place in comparison with a 33% volume drop.

VECV was the first company in the Commercial Vehicle Industry to migrate to BS VI norms well before the mandated timeline. Given VECV's experience of more than six years, in supplying Euro 6 compliant engines to Volvo, we have an edge in handling the challenges posed by the BS VI technology.

In line with our vision to drive modernization in commercial transportation, VECV introduced the Pro 2000 series, the new range of light and medium duty vehicles. These vehicles set new industry benchmarks for industry-first features in enhanced reliability, safety, comfort and efficiency. The new vehicles entailed indigenously developing two new engines (two-litre and three-litre engines) designed from scratch and two new contemporary style cabins 1.8 metre and 2 metre wide.

We also undertook a complete modernization of our fleet at VECV this year. We have introduced several new state-of-the- art features in our trucks and buses aided by the Volvo Group, making them relevant and more efficient for Indian conditions, while adapting contemporary world-class technology.

During the year, VECV started operations at the new truck plant at Bagroda, near Bhopal for the assembly of new engines for our Pro 2000 series. This manufacturing facility is built to meet the Industry 4.0 standards. We expect new trucks

to start rolling out of this facility during this year. This new facility, together with our manufacturing plant at Pithampur significantly increases our manufacturing capacity.

We hold true to our brand promise of 'ensuring the best uptime in the industry', and endeavour to be a commercially focussed organization. This year, we set up the 'Uptime Centre', a first-of-its-kind initiative in the industry. These centres operate 24x7 and can provide remote diagnostic services and real-time support to on-ground technicians by logging into any truck at the dealer workshop or via the Roadside Assistance support team. This will be extremely advantageous for our customers. Furthermore, we have plans to introduce predictive maintenance to avoid potential breakdowns thereby increasing uptime for our customers.

VECV continues to remain strong in the high-end niche segments of coal mining and across other applications in the areas of construction, cargo movement among others.

In international markets, VECV has made further progress in high growth potential markets like Indonesia and Malaysia in SouthEast Asia, few more markets of the Middle East and Africa apart from our strong presence in India like markets of South Asia.

While we expect the current year to continue to be challenging, we remain focussed on our long-term initiatives and are optimistic that the industry will be back on track soon, largely led by investments in infrastructure. At the same time, we are bringing sharp focus on cost management and improving productivity. Our superior technology and expertise gives us the edge for the BS VI journey in future. We will continue to focus on driving modernization in the commercial vehicle industry and we hope to better the market as the economy improves and the industry comes back on track.

Looking ahead

The global economic impact of the COVID-19 pandemic is likely to be significant as pointed out by several experts. As the virulence of the virus slows down, countries and economies will begin to reboot. We do believe that recovery is likely to be gradual from here, but there is marked optimism for economies like India. We will have to adapt to what will be the new normal going forward.

At Eicher Motors, we have the experience of building resilient and profitable businesses with very strong business models that are well prepared to meet such extraneous challenges.

I am confident of the vision that both Vinod Dasari and Vinod Agarwal have for Royal Enfield and VECV respectively, and believe that we are well poised to take Eicher Motors to the next level. Both gentlemen have been inducted to the Board of EML, and this strengthens not just our governance and leadership, but also fortifies our vision and brings in better synergies.

We have robust business models for both Royal Enfield and VECV and have committed and competent teams. Both companies have strong product pipelines and will continue to push forward with our long-term strategic plans.

Siddhartha Lal

Managing Director Eicher Motors Limited

   

Eicher Motors Ltd Company History

Eicher Motors (EML) manufactures the iconic Royal Enfield brand of motorcycles, which leads the premium motorcycle segment in India. Royal Enfield is the oldest motorcycle brand in continuous production world-wide since 1901. Royal Enfield's product line-up includes the Bullet, Classic and Thunderbird models in 350cc. EML's 50-50 joint venture with the Sweden's AB Volvo , VE Commercial Vehicles Limited (VECV), designs, manufactures and markets reliable, fuel-efficient trucks and buses is one of India's leading manufacturer of trucks,buses, engines and engineering components. VECV has a wide product range from 5t to 40t GVW trucks and 15 to 65 seater buses. The buses are sold under the Skyline and Starline brands. Eicher Motors Ltd was incorporated in the year 1982. The company in technical collaboration agreement with Mitsubishi Motor Corporation of Japan produced the Light Commercial Vehicle in India. The commercial production as commenced in their plant at Pithampur in Madhya Pradesh, with the launch of Canter truck in June 1986. The agreement with Mitsubishi ended in March 1994 after successful transfer of technology and achieving total Indigenization. The demerger of Tractors, Two-Wheelers, Engines and Gears businesses from Eicher Ltd was transferred to the company with effect from April 1, 2003. In May 25, 2005, the company acquired 100% of the shares of Design Intent Engineering Inc, USA, which is engaged in the business of providing computer aided engineering & design services for a consideration of USD 2.5 million. The company's Tractor division at Mandideep, Gears division at Parwanoo and Engines division at Alwar had been sold to TAFE Motors and Tractors Ltd, a wholly owned subsidiary of Tractors and Farm Equipment Ltd, for a consideration of Rs 310 crore with effect from June 1, 2005. The company acquired a transmission gear manufacturing plant at Dewas having a gear cutting capacity of 5 lacs gears per annum with effect form November 1, 2006. During the year 2006-07, the company acquired the 100% equity shares of Hoff and Associates (Hoff), Plymouth, Michigan (USA) along with Hoff's two wholly owned subsidiaries in Beijing and Shanghai, China for a consideration of USD 3.5 million. In order to synergize the activities between the two subsidiary companies in USA, Hoff and Associates merged with Design Intent Engineering Inc with effect from January 1, 2008 and the name of Design Intent Engineering Inc was changed to Eicher Engineering Solutions Inc. In May 2008, the company signed a definitive agreement with Aktiebolaget Volvo, Sweden for a formation of a joint venture company through transfer of the existing Commercial Vehicle Business along with related Components and Design Services Business. In August 2008, they transferred the Components and Design Services Business to VECV, the joint venture company with effect from July 01, 2008. On 11 June 2010, VE Commercial Vehicles (VECV) announced an investment of Rs 288 crore in its Pithampur, Madhya Pradesh plant for the production and final assembly of the Volvo group's new global medium-duty engine platform. On 12 July 2011, Eicher Motors announced that it has been allotted land government at the SIPCOT Industrial Growth Centre, Oragadam by the Tamil Nadu state for building a new plant for the manufacture of Royal Enfield motorcycles. On 30 April 2013, Royal Enfield announced that it had started commercial production from its new manufacturing facility at Oragadam, Tamil Nadu. In July 2012, Eicher Motors signed an equal joint venture with Polaris Industries Inc. to set up a greenfield project. EML's joint venture with Polaris Industries Inc.- Eicher Polaris Private Ltd (EPPL) launched Multix- a new 3-in-1 vehicle for the independent businessman in June 2015. In December 2013, VECV's Eicher Trucks and Buses division (ETB) launched the future of Indian trucking with the introduction of its 'Pro series' range of trucks and buses ranging from 5-49 tonne. In February 2015, Royal Enfield started retail operations in Colombia with the opening of two exclusive stores in Bogota and Medellin. In May 2015, Royal Enfield acquired Harris Performance, a motorcycle engineering and design firm based in UK. On 24 August 2015, Royal Enfield announced its entry in Indonesia at GAIKINDO Indonesia International Auto Show (GIIAS) 2015. Royal Enfield opened its first exclusive store in Jakarta in January 2016. In December 2015, Royal Enfield announced its entry in Thailand at the Thailand International Motor Expo in Bangkok. In June 2016, Royal Enfield announced its tie-up with Flipkart, India's largest e-commerce marketplace to sell Royal Enfield gear and accessories. Royal Enfield opened its flagship store in Milwaukee, North America in September 2016. Two exclusive stores were also added in Europe in October 2016, one each in Barcelona and Valencia in Spain. On 18 March 2017, VE Commercial Vehicles Limited announced that it had divested 100% shares of its wholly owned subsidiary Eicher Engineering Solutions Inc in United States of America (USA) to SegulaTecnologias Espana, S.A.U., a Spanish corporation. The total enterprise value of the deal was pegged at $1,852,000. In August 2017, EML commenced commercial production of motorcycles at its third manufacturing facility at Vallam Vadagal near Chennai. In September 2017, Royal Enfield launched two variants of its bestselling motorcycle model, Classic - Stealth Black in 500cc and Gunmetal Grey in 350cc with a contemporary and stylish matt finish. In October 2017, Royal Enfield forayed into Vietnam, the fourth biggest motorcycle market in the world, and opened its first store in Ho Chi Minh City. In November 2017, Royal Enfield unveiled its ground-up modern twin motorcycles the Interceptor INT 650 and the Continental GT 650 at the EICMA Motor Show, Milan, Italy. In November 2017,the company opened the Garage Cafe in Goa. Reflecting the motorcycling way of life', the 120-seater Garage Cafe on the banks of the Baga River in Baga, Goa offers a relaxed, unhurried experience and is conceptualised to be an inclusive, engaging space. The Garage Cafe is a one-of-itskind format that is an amalgamation of the various dimensions of Royal Enfield. The cafe houses a motorcycle museumand- exhibition area, an exclusive gear store, a motorcycle customisation area and a service bay. During 2017-2018, the company in an effort to allow easier discovery and access to preowned Royal Enfield motorcycles, introduced first pre-owned motorcycle store - Vintage - in Chennai. A pioneering initiative in the two-wheeler industry, Royal Enfield Vintage will deal exclusively in pre-owned, refurbished and restored motorcycles offering hassle-free sale and purchase experience to consumers. The company also added 150 new dealerships in India taking the total retail outlet strength to 825 exclusive stores in the country, making the company the strongest premium motorcycle distribution in the country by a large margin. In June 2018, the company introduced the limited edition Pegasus at the Imperial War Museum in Duxford, U.K. Inspired by the RE/WD motorcycle, lovingly known as the Flying Flea, which played a pivotal role in World War 2, only 1,000 motorcycles were available across the world. The company sold all the 250 motorcycles meant for India in just 178 seconds via an online sale!. The company also successfully introduced Anti-lock Braking Systems (ABS) on all our motorcycles, well ahead of the regulatory deadline, starting with the Signals, inspired by our long association with the Indian armed forces. During 2019-2020 under review,The companies flagship business Royal Enfield sold 6,97,582 motorcycles and in an effort to increase the retail footprint in India and to cater to smaller towns and cities, Royal Enfield announced the Studio Stores format and launched 600 new Studio Stores during the year. These, together with the 921 dealerships, take Royal Enfield's retail touchpoints to 1,521 across India. The company also also launched new variants of the Royal Enfield Bullet 350 and the Classic 350 during the year, to further enhance accessibility for consumers. In addition to the BS VI compliant Classic 350, Bullet 350, the 650 Twin motorcycles, Royal Enfield also launched the BS VI Himalayan in the fourth quarter of the fiscal year. The Himalayan BS VI has a vibrant new look and improved features that have made it instantly successful in India and across the world. The new motorcycle has received great reviews from media, experts and from consumers. In the international markets, the company now has 77 exclusive stores outside of India, and a retail network spread across 60 countries. The company has opened new consumer touchpoints in Thailand, Brazil, Argentina, France and the UK, taking our total dealer touchpoints in international markets to over 660 stores including multi-brand outlets. Royal Enfield expanded its retail footprint in the Asia-Pacific region during 2019-20 by setting up its first standalone, flagship store in Seoul, South Korea. During the year under review, the company completed the set-up of our Global Headquarters in Chennai which also houses a world-class product development and technology centre.

Eicher Motors Ltd Directors Reports

To the Members of Eicher Motors Limited

The Directors have pleasure in presenting the Thirty Eighth Annual Report along with the Audited Financial Statements of your Company for the financial year ended March 31, 2020.

FINANCIAL RESULTS

Your Company has earned a Net revenue from operations of Rs. 9,077.47 crores during the financial year 2019-20. The profit before depreciation and interest expense including interest on lease liability (Ind AS 116) of Rs. 10.86 crores amounted to Rs. 2,203.78 crores, which is 24.3% of the total revenue. After accounting for other income of Rs. 615.34 crores, interest expense of Rs. 10.86 crores and depreciation of Rs. 377.92 crores, profit before exceptional item and tax amounted to Rs. 2,430.34 crores.

Profit after tax amounted to Rs. 1,903.82 crores after income tax provision of Rs. 526.52 crores. Total Comprehensive Income for the year, net of tax amounted to Rs. 1,910.84 crores.

The financial results are summarized below:

Net Revenue from operations 9,077.47 9,794.48
Profit before depreciation and interest 2,203.78 2,944.38
Interest 10.86 2.99
Depreciation 377.92 298.93
Profit before other income and tax 1,815.00 2,642.46
Other income 615.34 508.04
Profit before exceptional items and tax 2,430.34 3,150.50
Exceptional items - (17.52)
Profit before tax 2,430.34 3,132.98
Provision for tax (including Deferred tax) 526.52 1,078.54
Net profit after tax 1,903.82 2,054.44
Other comprehensive income 7.02 (5.77)
Total Comprehensive income for the year/period, net of tax 1,910.84 2,048.67
Balance in statement of profit and loss brought forward from previous year 6,576.63 4,871.26
Amount available for appropriation

(Excluding exchange difference in translation of foreign operations)

8,471.89 6,924.79
Dividend for FY 2018-19 paid in 2019-20 - 341.11
Interim dividend proposed and paid in 2019-20 341.32 -
Tax on dividend 70.16 56.14
Earnings per share
- Basic (Rs.) 697.50 753.37
- Diluted (Rs.) 697.16 752.54

CHANGE IN THE NATURE OF BUSINESS, IF ANY

There is no change in the nature of business of the Company during the financial year under review.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL poSITIoN of THE company THAT HAVE OCCURRED AFTER MARCH 31, 2020 TILL THE DATE OF THIS REPORT

Due to COVID-19, the Company temporarily suspended the operations in all the units of the Company. COVID-19 has impacted the normal business operations of the Company by way of interruption in production, supply chain disruption,

unavailability of personnel, closure/lock down of production facilities, retail outlets of dealers etc. However, production and sales/supply of goods have commenced during the month of May 2020 with partial capacity.

The Company has performed a detailed assessment of its liquidity position and the recoverability of the assets as at the Balance Sheet date and has concluded that based on current indicators of future economic conditions, the carrying value of the assets will be recovered. Management believes that it has fully considered all the possible impact of known events in the preparation of the standalone financial results. However, the impact assessment of COVID-19 is a continuing process, given the uncertainties associated with its nature and duration. The Company will continue to monitor any material changes to future economic conditions and the consequent impact on its business, if any.

DIVIDEND

The Board of Directors at its meeting held on March 11, 2020, has approved payment of interim dividend of Rs. 125/- per Equity Share (@1250%) of face value of Rs. 10/- each, out of the then profits of the Company for the financial year 2019-20 in accordance with the Dividend Distribution Policy of the Company.

The entitlement of interim dividend has been determined in the following manner:

a) To all Beneficial Owners in respect of shares held in dematerialized form as per the data made available by the National Securities Depository Limited (NSDL) and the Central Depository Services (India) Limited (CDSL) as of the close of business hours on March 21, 2020 (record date);

b) To all Members in respect of shares held in physical form after giving effect to valid transfer/transmission in respect of transfer/transmission requests lodged with the Company on or before the close of business hours on March 21, 2020 (record date).

Out of the total Interim Dividend amount, the Company has completed remittance of payment through electronic transfer. The Interim Dividend amount to be paid through Warrants and Bank Demand Drafts is pending dispatch due to nationwide lockdown/movement restrictions imposed by the Government on account of Covid-19 outbreak and the same will be dispatched promptly once normalcy is restored.

AMOUNTS TRANSFERRED TO RESERVES

During the financial year 2019-20, no amount was transferred to General Reserve of the Company.

BRIEF DESCRIPTION OF THE STATE OF THE COMPANY'S AFFAIRS/ BUSINESS pERFORMANCE

Your Company has sold 6,98,216 motorcycles in the financial year 2019-20, 15.2% lower when compared to financial year 2018-19 sales of 8,23,828 motorcycles. Out of 6,98,216 motorcycles sold in 2019-20, 39,296 motorcycles were exported, a growth of 88.7% over the volume of 20,825 motorcycles exported in financial year 2018-19.

Net Revenue from operations for financial year 2019-20 year was Rs. 9,077.47 crores, 7.3% lower when compared with previous financial year (Rs. 9,794.48 crores). Net Sales of spare parts, gears and services increased to Rs. 1,075.18 crores in financial year 2019-20 from Rs. 1,056.39 crores in the previous financial year, registering a growth of 1.8%.

Your Company's profit before depreciation, interest, exceptional item and tax was Rs. 2,203.78 crores in financial

year 2019-20, lower by 25.2% over Rs. 2,944.38 crores recorded in financial year 2018-19.

MARKET AND FUTURE PROSPECTS

Please refer to Management Discussion & Analysis Report which forms part of the Annual Report.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information on conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be given pursuant to the provisions of Section 134 of the Companies Act, 2013 ("the Act"), read with the Companies (Accounts) Rules, 2014 is provided under Annexure-1.

DISCLOSURE REGARDING ISSUE OF SWEAT EQUITY SHARES AND EQUITY SHARES WITH DIFFERENTIAL RIGHTS

The Company has not issued any sweat equity shares or equity shares with differential rights during the financial year 2019-20.

CHANGES IN SHARE CARITAL & THE COMPANY'S EMPLOYEE STOCK OPTION PLAN, 2006AND RESTRICTED STOCK UNITS PLAN, 2019

The paid up Equity Share Capital of the Company as on March 31, 2020, was Rs. 27,30,45,700/-. During the year under review, the Company has issued 22,000 Equity Shares of face value of Rs. 10/- each pursuant to its Employees Stock Option Plan, 2006 ("ESOP, 2006"). No shares have been issued under the Company's Restricted Stock Units Plan, 2019 ("RSU Plan, 2019").

A Statement giving complete details as at March 31,

2020, pursuant to Regulation 14 of the SEBI (Share Based Employee Benefits) Regulations, 2014 is available on the website of the Company and the weblink for the same is https://www.eicher.in/uploads/1594715939_Eicher-Motors- ESOP-Statement-2019-20.pdf

ESOP, 2006 and RSU Plan, 2019, for grant of stock options have been implemented in accordance with the aforesaid SEBI Regulations. A certificate from M/s S.R. Batliboi & Co.,

LLP, Statutory Auditors, in this regard will be available for inspection on the website of the Company under "Investors" Section. The Company has not changed its ESOP, 2006 and RSU Plan, 2019 during the year under review.

Further, details of options granted and exercised are included in Note no. 50 in the notes to accounts forming part of consolidated financial statements.

DEPOSITS

The Company has not accepted any deposits from the public/members under Section 73 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014 during the financial year under review. The Company has not renewed/ accepted fixed deposits after May 29, 2009. There are no deposits that remain unclaimed.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with Section 149(7) of the Act, all the Independent Directors of the Company have given written declarations to the Company confirming that they meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16 of SEBI (LODR) Regulations,

2015. As on March 31, 2020, all Independent Directors of the Company have registered themselves in the Independent Director's databank maintained by Indian Institute of Corporate Affairs in terms of Section 150 of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment and Qualifications of Directors) Rules, 2014.

In accordance with the provisions of Section 152 and other applicable provisions of the Act & the Articles of Association of the Company, Mr. Vinod K. Aggarwal, Non-Executive Director, retires by rotation and being eligible offers himself for re-appointment at the ensuing AGM. The Board of Directors of the Company at its meeting held on February 6, 2020, re-appointed Mr. S. Sandilya and Ms. Manvi Sinha, as Independent Directors of the Company for a period of 5 (five) consecutive years each with effect from February 13, 2020, after taking into consideration recommendations of the Nomination & Remuneration Committee of the Company and subject to requisite approval of the shareholders at the ensuing AGM. In the opinion of the Board, Mr. S. Sandilya and Ms. Manvi Sinha possess requisite skills & expertise in the context of business of the Company. For details on skills/expertise/competencies of Mr. Sandilya and Ms. Sinha respectively, please refer Corporate Governance Report forming part of this Annual Report.

During the year under review, Mr. Vinod Kumar Dasari, Whole-time Director & CEO-Royal Enfield and Mr. Vinod Kumar Aggarwal, Non-Executive Director, were appointed on the Board of the Company w.e.f. April 1, 2019, with requisite approvals of the shareholders obtained at the 37th Annual General Meeting held on August 1, 2019. There has been no other change in the Directors and Key Managerial Personnel of the Company during the financial year under review. Further, the Board at its meeting held on May 6, 2020 has appointed Mr. Kaleeswaran Arunachalam as the Chief Financial Officer of the Company with effect from May 6, 2020 in place of Mr. Lalit Malik, who shall continue as the Chief Commercial Officer of the Company.

 

THE COMPANY'S POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION

The Company's Hiring & Employment Policy:

A number of factors are considered towards selecting candidates at the Board level which include:

? Ability to contribute to strategic thinking

? Proficiency in Governance norms, policies and mechanisms at the Board level

? Relevant cross industry/functional experience, educational background, skills and experience

? Wherever relevant, independence of Directors in terms of applicable regulations.

With respect to core competencies and personal reputation, our practices ensure through the selection process that all Directors:

? Exhibit integrity and accountability

? Exercise informed judgement

? Are financially literate

? Are mature and confident individuals

? Operate with high performance standards

Removal of Directors

Under extreme circumstances and in highly unusual situations it may become necessary to remove a member from the Board of Directors. Reasons for doing so, may relate to any of the following (indicative; other than as provided under the Companies Act, 2013):

i. Breach of confidentiality in anyway

ii. Failure to meet obligatory procedures in the disclosure of conflict of interest

iii. Failure to fulfil the fiduciary duties of a Director for the Company

iv. Acting in any other manner which is against the interests of the Company

The Company's Remuneration Policy:

The Company's Compensation Strategy defines the principles underlying compensation philosophy for its employees. Compensation is a critical piece of overall human-resources strategy and broadly refers to all forms of financial returns and tangible benefits that employees receive as a part of their employment relationship.

The Remuneration/Compensation Policy of the Company is designed to attract, motivate and retain manpower. This Policy applies to Directors and Senior Management including Key Managerial Personnel (KMP) and other employees of the Company.

The remuneration of the Managing Director, Executive Director, Key Managerial Personnel (KMPs) and CXOs of the Company is recommended by the Nomination and Remuneration Committee based on criteria such as industry benchmarks, the Company's performance vis-a-vis the industry, responsibilities and performance assessment. The Company pays remuneration by way of salary, perquisites and allowances (fixed component), incentive remuneration and/or commission (variable components).

Loans/advances may be extended to employees for various personal purposes or to aid business functions, from time to time, on a case to case basis, in accordance with the relevant Human Resource guidelines/policies in force or as may be approved by the Chief Financial Officer, the Chief Human

Resource Officer of the Company, or any person authorized by them, including for relocation viz. school deposits/expenses, travel/logistics expenses, housing advance, housing deposits/ brokerage, any other expenses towards relocation; advance submission of tax deducted at source by the Company on behalf of employee; advance towards medical insurance premiums; loans granted to enable grantees exercise ESOPs and towards deposit of perquisite tax thereon; loans/advances covered under Employees Union recognized by the Company as per Union Agreement; medical emergency advances etc.

Additionally, in the event of exigencies arising due to calamities, the Company may provide financial assistance to any affected employee by way of extending interest free loan in an amount not exceeding his/her two months' gross salary.

Remuneration by way of commission to the Non-Executive Directors shall be decided by the Board of Directors within the ceiling of a sum, not exceeding 1% of the annual net profits of the Company in each of the financial year, calculated in accordance with the provisions of the Act and as approved by the members by passing a resolution in the general meeting.

Remuneration of KMPs and employees largely consists of basic remuneration, perquisites, allowances, performance incentives and employee stock options granted pursuant to the Employees Stock Option Plan of the Company. The components of remuneration vary for different employee levels and are governed by industry patterns, qualifications and experience of the employee and his/her responsibility areas, employee performance assessment etc.

The said Policy is also available on the website of the Company at http://www.eicher.in/uploads/1561782697_remuneration-policy.pdf

ANNUAL EVALUATION OF BOARD, COMMITTEES AND INDIVIDUAL DIRECTORS

During the financial year under review, formal annual evaluation of the Board, its Committees and individual Directors was carried out pursuant to the Board Performance Evaluation Policy of the Company and provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015.

The Nomination and Remuneration Committee specified the criteria for effective performance evaluation of the Board, its Committees and Individual Directors of the Company. The performance of the Board and Committees was evaluated after seeking inputs from all the Directors on the basis of the criteria such as Board/ Committee constitution, frequency of meetings, effectiveness of processes etc. The performance of individual Directors (including Independent Directors) was evaluated by the Board (excluding the Director being evaluated) after seeking inputs from all Directors on the basis of the criteria such as thought contribution, business insights and applied knowledge. After the Board carried out aforesaid evaluation, the Nomination & Remuneration Committee reviewed implementation of the manner specified by it for performance evaluation & effectiveness of the process.

A separate meeting of Independent Directors was also held to review the performance of the Managing Director,

performance of the Board as a whole and performance of the Chairperson of the Company. Review of the performance of the Chairperson was done after taking into account the views of the Executive Director and Non-Executive Directors (excluding the Chairperson being evaluated).

MEETINGS OF BOARD OF DIRECTORS

Eight (8) meetings of the Board of Directors of the Company were conducted during the financial year under review.

The details of Board/Committees/Shareholder meetings are provided under the Corporate Governance Report which forms part of the Annual Report.

DETAILS OF LOANS, GUARANTEES AND INVESTMENTS UNDER SECTION 186 OF THE ACT

The details of loans, guarantees and investments made by the Company during the financial year under review which are covered under Section 186 of the Companies Act, 2013 form part of the notes to the financial statements provided in this Annual Report.

PARTICULARS OF RELATED PARTY TRANSACTIONS

All contracts/ arrangements/ transactions entered into by the Company during the financial year with related parties are in compliance with the applicable provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015. Requisite approval of the Audit Committee and the Board (wherever required) was obtained by the Company for all Related Party Transactions.

There were no materially significant Related Party Transactions made by the Company with Promoters, Directors or Key Managerial Personnel, subsidiaries, joint ventures and associate companies which may have a potential conflict with the interest of the Company. There are no transactions that are required to be reported in Form AOC-2, hence the said form does not form part of this report. However, the details of the transactions with related parties are provided in the Company's financial statements in accordance with Indian Accounting Standards.

The Company has a Policy on materiality of and dealing with Related Party Transactions, as approved by the Board, which is available on its website www.eichermotors.com.

AUDIT COMMITTEE

The Audit Committee of the Company is constituted pursuant to the requirements of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015. At present, members of the Audit Committee are:

Sl. No. Name of Members
1 Mr. S Sandilya (Chairman)
2 Mr. Siddhartha Lal
3 Ms. Manvi Sinha
4 Mr. Inder Mohan Singh

During the year under review, the Board at its Meeting held on November 8, 2019, appointed Mr. Inder Mohan Singh, Non-Executive Independent Director as Member of the Audit Committee.

DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM

The Company has formulated a Whistle Blower Policy to establish a vigil mechanism for Directors, employees, dealers and vendors of the Company to report concerns about unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct or Ethics Policy or to report genuine concerns or grievances including instances of leak or suspected leak of unpublished price sensitive information pursuant to SEBI (Prohibition of Insider Trading) Regulations, 2015. The Whistle Blower Policy of the Company is available at https:// www.eicher.in/uploads/1581075167_whistle_blower_policy.pdf.

 

SUBSIDIARIES, ASSOCIATE AND JOINT VENTURE COMPANIES

Highlights of performance of subsidiaries and joint venture companies and their contribution to the overall performance of the Company during the year under review:

Royal Enfield North America Limited (RENA)

RENA was incorporated in March 2015 as a 100% subsidiary of Eicher Motors Limited to manage the distribution and sales of Royal Enfield products and services including, motorcycles, spares and gear in North America. It sold 3,322 motorcycles (excluding 301 motorcycles sold to Royal Enfield Canada Limited, 100% subsidiary of RENA) during the year 2019-20 and achieved revenue of Rs.114.63 crores (including revenue of Rs. 9.45 crores by sales to Royal Enfield Canada Limited).

As of March 2020, RENA had contracted with 108 multi brand outlets in USA.

Royal Enfield Canada Limited (RECA)

RECA is a 100% subsidiary of RENA. RECA was incorporated in April 2016 in Canada to manage the distribution and sales of Royal Enfield products and services including, motorcycles, spares and gear in Canada. During the year 2019-20, the Company sold 301 motorcycles and achieved revenue of Rs. 10.10 crores. As of March 2020, RECA had contracted with 12 multi brand outlets in Canada.

Royal Enfield Brasil Comercio De Motocicletas Ltda. (REBRA)

Royal Enfield started its operations in Brazil through a direct distribution company by the name of Royal Enfield Brasil Comercio de Motocicletas Ltda in 2016. During the year the Company sold 2,300 motorcycles and achieved revenue of Rs. 45.29 crores.

Royal Enfield (Thailand) Ltd (RETH)

Royal Enfield (Thailand) Ltd. was incorporated on September 18, 2018 and commenced sales operations from September 2019. The Company's footprints have grown to 14 exclusive stores and 12 Authorized Sales & Service Points. In the year

2019, the Company received two awards from the Grand Prix group for Interceptor being the "Best Modern Classic" and Himalayan being "Best Lightweight Tourer" motorcycle. The Company plans to commence assembly operations from the year 2021 to cater to ASEAN region. During the year 2019-20, the Company sold 690 motorcycles and achieved revenue of Rs. 26.06 crores.

Royal Enfield (UK) Limited (REUK)

Royal Enfield (UK) Limited, was incorporated on August 20, 2019 to engage in the wholesale business of motorcycles, apparels, spares & accessories. The Company is yet to commence trading operations as at March 31, 2020.

Eicher Polaris Private Limited (EPPL)

Eicher Polaris Private Limited, a joint venture company, was involved in manufacturing and sales of personal utility vehicles.

The Board of Directors and Shareholders of EPPL at their respective meetings held on February 18, 2020 approved voluntary liquidation (solvent liquidation) of EPPL and appointed an insolvency professional as the liquidator. The liquidation process is under progress currently.

VE Commercial Vehicles Limited and its step-down subsidiaries

Overview of performance covered separately in the Annual Report.

Report containing salient features of financial statements of subsidiaries and joint venture companies

Pursuant to the provisions of Section 129(3) of the Act, a report containing salient features of the financial statements of the Company's subsidiaries and joint venture company in Form AOC-1 is attached as Annexure-2.

COMPANIES WHICH HAVE BECOME OR CEASED TO BE THE COMPANY'S SUBSIDIARIES,

JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE FINANCIAL YEAR

During the financial year under review, Royal Enfield (UK) Ltd. ("REUK") was incorporated on August 20, 2019 as wholly owned subsidiary of the Company. No other company has become or ceased to be the Company's subsidiary, joint venture or associate company during the financial year 2019-20.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY'S OPERATIONS IN FUTURE

There are no significant material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status of the Company and its future operations. However, members' attention is drawn to the statement on contingent liabilities, commitments in the notes forming part of the Financial Statements.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

Details of internal financial control and its adequacy are included in the Management Discussion and Analysis Report, which forms part of the Annual Report.

CORPORATE SOCIAL RESPONSIBILITY

The Company has constituted a Corporate Social Responsibility (CSR) Committee and has framed a Corporate Social Responsibility Policy and identified Healthcare, Children's education, Road safety, Environmental sustainability, Local Area Development in, including but not limited to, areas around the Company's establishments & in Himalayas and Livelihood development including vocational training for underprivileged as some of the key areas. The Company will continue to support social projects that are consistent with the Policy.

Corporate Social Responsibility Committee of the Company is constituted as follows:

1. Mr. S Sandilya - Chairman

2. Mr. Siddhartha Lal

3. Mr. Inder Mohan Singh

Annual Report on CSR activities is annexed as Annexure-3.

CONSOLIDATED FINANCIAL STATEMENTS

The consolidated financial statements have been prepared by the Company in accordance with the requirements of Indian Accounting Standard ("Ind AS")-110 "Consolidated Financial Statements" and Ind AS 28 "Investment in Associates and Joint ventures", prescribed under Section 133 of the Companies Act, 2013, read with the rules issued thereunder. The Company, its subsidiaries and jointly controlled entities adopted Ind AS from April 1, 2016. The consolidated financial statements are provided in the Annual Report. A statement containing the salient features of the financial statements of each of the subsidiary and joint venture company in the prescribed Form AOC-1 is attached.

Pursuant to Section 136 of the Act, the financial statements, consolidated financial statements and separate accounts of the subsidiaries are available on the website of the Company at www.eichermotors.com. The Company shall provide the copies of the financial statements of the Company and its subsidiary companies to the shareholders upon their request received on investors@eichermotors.com. The consolidated total comprehensive income of the Company and its subsidiaries amounted to Rs. 1,838.62 crores for the financial year 2019-20 as compared to Rs. 2,196.53 crores for the previous financial year 2018-19.

 

AUDITORS

(a) Statutory Auditors and Their Report

M/s S.R. Batliboi & Co., LLP, Chartered Accountants (Firm Registration Number: FRN 301003E/E300005) were appointed as Statutory Auditors in the 35th (Thirty Fifth)

Annual General Meeting (AGM) of the Company for a period of five years, from the conclusion of 35th AGM till the conclusion of the 40th AGM of the Company, subject to ratification of their appointment at every AGM by the shareholders, if required pursuant to the provisions of the Companies Act, 2013 ("Act"). Central Government vide the Companies (Amendment) Act, 2017 has amended the provisions of Section 139 of the Act and ratification of appointment of Statutory Auditors in every AGM is no longer required. The Statutory Auditors have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules made thereunder to continue to act as Statutory Auditors of the Company.

The Statutory Auditors had carried out audit of financial statements of the Company for the financial year ended March 31, 2020 pursuant to the provisions of the Act. The reports of Statutory Auditors form part of the Annual Report. The reports are self-explanatory and do not contain any qualifications, reservations or adverse remarks.

(b) Secretarial Auditors and Their Report

The Board of Directors has appointed M/s. Shweta Banerjee & Associates, Company Secretaries, to conduct Secretarial Audit for the financial year ended March 31, 2020. As required under Section 204 of the Companies Act, 2013, the Secretarial Audit Report is annexed as Annexure-4 to this Report. The Secretarial Auditors' Report is self-explanatory and does not contain any qualifications or adverse remarks which require any clarification or explanation.

(c) Cost Auditor

In terms of Section 148 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, it is hereby confirmed that the cost accounts and records are made and maintained by the Company as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013.

Ms. Jyothi Satish, a qualified Cost Accountant, has been appointed as the cost auditor to carry out audit of the cost records of the Company for the financial year 2019-20 pursuant to the provisions of the Companies Act, 2013. The Cost Auditor shall submit its report to the Board of Directors within the time prescribed under the Companies Act, 2013 and the rules made thereunder.

CORPORATE GOVERNANCE, MANAGEMENT DISCUSSION & ANALYSIS AND BUSINESS RESPONSIBILITY REPORTS

As per SEBI (LODR) Regulations, 2015, Corporate Governance Report together with the Auditors' certificate regarding compliance of conditions of Corporate Governance, Management Discussion & Analysis Report and Business Responsibility Report form part of the Annual Report.

SUSTAINABILITY REPORT

The Company in its commitment to a sustainable global economy has voluntarily prepared a Sustainability Report based on GRI Sustainability Reporting Standards, which will help stakeholders to understand the Company's economic, environmental, social and governance performance more effectively and analyzing the financial and non-financial performance of the Company. With this, stakeholders shall also have a better understanding of the Company's long term perspective.

The Sustainability Report captures our passion along with the responsibilities for communicating sustainability performance and its impact on our stakeholders through various aspects such as responsible consumption, clean water and sanitation, gender equality, innovation, infrastructure etc. The Sustainability Report for the financial year 2019-20 is available on the Company's website at https://www.eicher.in/ sustainability-report

EXTRACT OF ANNUAL RETURN

Pursuant to the provisions of Sections 134 & 92(3) of the Companies Act, 2013, the details forming part of the extract of the Annual Return in Form MGT-9 is annexed as Annexure-5 to this Report and which is also available on the website of the Company www.eichermotors.com.

DIRECTORS RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

a) that in the preparation of the Annual Financial Statements for the year ended March 31, 2020, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) that such accounting policies as mentioned in Note no.

3 of the Notes to the Financial Statements have been selected and applied consistently and judgement and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2020 and of the profits of the Company for the year ended on that date;

c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) that the annual Financial Statements have been prepared on a going concern basis;

e) that proper internal financial controls to be followed by the Company have been laid down and that the financial controls are adequate and were operating effectively; and

f) that proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

PARTICULARS OF EMPLOYEES

Disclosures as required under Section 197(12) of the

Companies Act, 2013 read with Rule 5(1) of the Companies

(Appointment and Remuneration of Managerial Personnel)

Rules, 2014:

1) Ratio of the remuneration of each director to the median remuneration of the employees of the Company and the percentage increase in remuneration of Directors & KMPs in the Financial Year:

Sl. No. Name of the Director/KMP Designation Ratio of Remuneration of each Director to median remuneration of employees Percentage Increase in Remuneration for FY 2019-20 over FY 2018-19
1 Mr. S Sandilya Chairman & Non-Executive Independent Director 10.1 0.97
2 Mr. Siddhartha Lal Managing Director 311.1 51.29
3 Mr. Vinod K. Dasari Whole-time Director and CEO-Royal Enfield 398.8 NA*
4 Mr. Inder Mohan Singh Non-Executive Independent Director 2.6 9.35“
5 Ms. Manvi Sinha Non-Executive Independent Director 2.6 14.01
6 Mr. Lalit Malik Chief Financial Officer" - (21.08)'
7 Mr. Manhar Kapoor General Counsel and Company Secretary - (35.31)'

*Percentage increase in remuneration for FY 2019-20 over FY 2018-19 is not applicable since Mr. Vinod K Dasari was appointed by the Board as Whole-time Director and CEO- Royal Enfield, w.e.f April 1, 2019.

“Mr. Inder Mohan Singh, Non-Executive Independent Director, joined the Board w.e.f November 12, 2018, hence, to compute percentage increase in his remuneration for FY 2019-20 over FY 2018-19, remuneration for FY 2018-19 has been annualized.

'Percentage decrease in remuneration for FY 2019-20 over FY 2018-19 is mainly due to perquisite on exercising shares under the Company's Employee Stock Options Plan, 2006 (ESOP, 2006), during the financial year 2018-19. It shall be 12.37% and 15.17% for Mr. Lalit Malik and Mr. Manhar Kapoor, respectively, without considering perquisite on exercising shares under ESOP, 2006 for both the financial years.

“Mr. Lalit Malik, Chief Commercial Officer, had also been the Chief Financial Officer of the Company till May 6, 2020.

Note: Mr. Vinod K. Aggarwal, Non-Executive Director, is not entitled for any remuneration by way of sitting fees or commission or otherwise, in the Company.

2) Percentage decrease in the median remuneration of the employees in the financial year: 5%@

@decrease of median remuneration by 5% is due to employee additions who are below the median remuneration

3) Number of permanent employees on the rolls of the Company as at March 31, 2020: 4,899 employees.

4) The average decrease in median remuneration of the employees other than managerial personnel was 5% as compared to the increase in the managerial remuneration by 25%.

5) It is hereby affirmed that the remuneration is paid as per the Remuneration Policy of the Company.

Further, a statement containing particulars of top ten employees in terms of the remuneration drawn and employees drawing remuneration in excess of the limits set out in Rule 5(2) & (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, are provided as part of the Directors' Report. However, in terms of provisions of Section 136 of the said Act, the Annual Report is being sent to all the members of the Company and others entitled thereto, excluding the said statement. Any member interested in obtaining such particulars may write to the Company Secretary at investors@eichermotors.com

RISK MANAGEMENT

Requisite information is provided under Management Discussion and Analysis Report which forms part of the Annual Report.

COMPLIANCE OF SECRETARIAL STANDARDS

During the financial year under review, the Company has complied with applicable Secretarial Standards specified by the Institute of Company Secretaries of India pursuant to Section 118 of the Companies Act, 2013.

SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Requisite information is provided under Corporate Governance Report which forms part of the Annual Report.

ACKNOWLEDGEMENT

We thank our customers, business associates and bankers for their continued support during the financial year.

We wish to convey our deep appreciation to the dealers of the Company for their achievements in the area of sales and service, and to suppliers/ vendors for their valuable support.

We also place on record our sincere appreciation for the enthusiasm and commitment of the Company's employees for the growth of the Company and look forward to their continued involvement and support.

For Eicher Motors Limited
Siddhartha Lal S. Sandilya
Managing Director Chairman
DIN: 00037645 DIN:00037542
Place: London, UK Place: Chennai, Tamil Nadu
Date: June 12, 2020

 

   

Eicher Motors Ltd Company Background

S SandilyaSiddhartha Lal
Incorporation Year1982
Registered Office3rd Floor - Select Citywalk,A - 3 District Centre Saket
New Delhi,New Delhi-110017
Telephone91-011-41437600,Managing Director
Fax91-011-4415997
Company SecretaryManhar Kapoor
AuditorS R Batliboi & Co LLP
Face Value1
Market Lot1
ListingBSE,MSEI ,NSE,
RegistrarLink Intime India Pvt Ltd
Noble Heights 1st Fl,Plot NH 2 C-1 Block ,LSC Janakpuri ,New Delhi - 110058

Eicher Motors Ltd Company Management

Director NameDirector DesignationYear
S Sandilya Chairman(Non Exe)&Director(Ind 2020
Siddhartha Lal Managing Director & CEO 2020
Manhar Kapoor Company Secretary 2020
Manvi Sinha Non-Exec. & Independent Dir. 2020
Inder Mohan Singh Non-Exec. & Independent Dir. 2020
Vinod K Desari Whole time Director & CEO-Roya 2020
Vinod Aggarwal Non-Exec & Non-Independent Dir 2020

Eicher Motors Ltd Listing Information

Listing Information
NIFTY
BSE_500
BSE_100
BSE_200
BSEDOLLEX
CNX500
BSEAUTO
CNX100
CNXINFRAST
CNXAUTO
CNX200
BSEGREENEX
BSECARBONE
NFT100EQWT
BSEALLCAP
BSELARGECA
GOODSSERVI
BSEMANUFAC
NFTQULTY30
SENSEX50
LMI250
BSEDSI
NFT50EQWT

Eicher Motors Ltd Finished Product

Product NameUnit Installed
Capacity
Production
Quantity
Sales
Quantity
Sales
Value
Two Wheelers No 0007947.59
Spare Parts NA 000628.97
Accessories&Other Allied-TradeNA 000432.13
Other Operating Revenue NA 00068.78
Engines No 0000
Gears & Shafts NA 0000
Generator Sets No 0000
Vehicles No 0000
Tractors No 0000
Mfd.Components for Sale Rs.0000
Processing charges NA 0000
Services NA 0000

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