2. Safe Harbor Statement
Some of the statements in this update that are not historical facts are forward-
looking statements. These forward-looking statements include our financial and
growth projections as well as statements concerning our plans, strategies, intentions
and beliefs concerning our business and the markets in which we operate. These
statements are based on information currently available to us, and we assume no
obligation to update these statements as circumstances change. There are risks and
uncertainties that could cause actual events to differ materially from these forward-
looking statements. These risks include, but are not limited to, the level of market
demand for our services, the highly- competitive market for the types of services
that we offer, market conditions that could cause our customers to reduce their
spending for our services, our ability to create, acquire and build new businesses and
to grow our existing businesses, our ability to attract and retain qualified personnel,
currency fluctuations and market conditions in India and elsewhere around the world,
and other risks not specifically mentioned herein but those that are common to
industry.
Page 2
4. About Us
BACKGROUND MISSION STATEMENT
To Be A Global Partner Of First Choice For Our
Lineage from Kirtane & Pandit, Chartered Customers With Leadership In Select Areas
Accountants (KPCA) a well respected accountancy firm To achieve this we will:
in business for 50+ yrs Become partner of first choice and provide best value for all
our customers.
Incorporated in 1990, IPO in 1999, issue Become leaders in at least two focus areas and build
oversubscribed 42 times capabilities and services to move up the value chain.
Create the right conditions to allow us to collaborate.
CMMi 1.2 L3, ISO 9001:2000 certified Create the right conditions wherever we operate, to attract
and retain professionals who are capable of supporting our
Achieved first Mission of reaching $ 100 Mn in
vision and mission.
revenues in FY07. This was the mission set in FY02 Be known for social contributions to the communities we
when KPIT was about $ 10 Mn in revenues operate in.
BOARD MEMBERS (Independent)
1. Padmabhushan Dr. R. A. Mashelkar
2. Dr. Srikant Datar
3. Padmashri Ms. Lila Poonawala
4. Mr. Amit Kalyani
5. Mr. Sudhir Tilloo
6. Dinesh Castellino
MANAGEMENT TEAM
Mr. S.B. (Ravi) Pandit – Chairman and Group CEO
Mr. Kishor Patil – CEO and Managing Director
NSE: KPIT; BSE: 532400
Page 4 Bloomberg: KPIT IN
5. Strategy
FEW VERTICALS NURTURE RELATIONSHIPS
Automotive & Transportation Identified Customer Universe
Industrial & Farm Equipment Strong Customer Pyramid
Hi-tech & Semiconductors Each with potential of Multi Million$
Energy and Utilities Partnership Approach
Defense & Government
FOCUS
BUILDING EXPERTISE INORGANIC GROWTH
Automotive Electronics and Embedded Domain Expertise
Engineering Services Geographical Presence
ERP / PLM Services Customer Acquisition
Enterprise Software Support Partnership Approach
Page 5
6. Global Footprint
SUBSIDIARIES
US SDC
UK Pune
Germany Bangalore
France Chennai
India Hyderabad
Noida
Munich
BRANCHES 12%
Japan
Korea 20%
Singapore
South Africa 68%
US Europe APAC
Page 6
7. Strong Business Model
Strategic Verticals
Business Unit Automotive,
Defense &
Transportation & Energy & Utilities
Government
Manufacturing(ATM)
Automotive
CTO Engineering:27% Automotive&
Transportation 2%
15%
6%
CIO Integrated Enterprise
Solutions: 38%
Industrials & Farm
Equipment 77%
CFO
SAP: 32%
Hi Tech &
Semiconductors Semiconductor ATM Energy & Utilities
Solutions Group:3% Defense & Government Others
ATM: Automotive, Transportation &Manufacturing
Page 7
8. Practice Based Organization
To bring in leadership in the verticals in which we operate, we have reorganized ourselves into
a Practice based organization with the intention of creating Best-in-Class Practices and thus
leadership in those practices
KPIT CUMMINS
IES SAP
Auto & Allied Engineering SBU
SBU SBU
- Oracle - Powertrain - AMS - SAP
-Embedded S/w
- PLM - Infotainment Implementation
-SOC - SAP Support
- BI - MEDS
- Chip Design - BI and
- MES - Hybrid and Analytics
- ESS - Navigation Verification - eBiz
- SCM - Vision
- eBiz Systems
With Practice Focus on innovation and leadership…………………….
6/16/2011 8
9. Our Offerings Space
Advanced Technology Solutions
Embedded Mechanical Product Hardware
Electronics Design Development Design
P
End to End ERP
CTO R
IMC Dash O
solutions D
I Industrials and Farm U
T Equipment C
Automotive & AUTO Dash T
I
S PLM & MES Transportation
Z
E Hitech, ISVs & E
R CIO Semiconductors CIO D
V Sales, MIDAS
Energy & Utilities S
I Distribution &
Defense & Government O
C after-market L
E services HITECH U
S Dash T
I
Analytics Help desk O
N
CFO Manager S
Warranty F & A and Order Procure to
Processing Compliance Management Pay
Global Business Solutions
Page 9
10. Emerging Leaders in our Focus Areas
50+ customer relationships
Domain & Process expertise
- 1500+ projects
- Own IP in 13 models + 50 Microcontrollers
- Influencing position
- AUTOSAR, JASPAR, SPICE Level 5
- Largest no. of Offshore Development
Centers
LEADER
Cummins experience : 50+ M global program
5 more marquee relationships
Scale
Work with 2 of the Top 3 Investment
Banks in France
Top 3 semi companies from Japan
Niche Sub domains areas: Payment
Top 7 companies in Auto
systems, TAAS, Asset Management
Top 2 ISVs in Enterprise Support
Customer spread across all
geographies
Moved from a horizontal centric model in early 2000 to a vertical centric model.
Organization changes to suit the vertical focus : Customer Focused Practice Led Organization.
Page 10
12. State of Automotive Industry
Pre 2007 2007-2009 2010 -
• Steady high • Sudden slowdown • Fast Increase In
growth in sales • Capacity Ramp Auto sales
• Easy availability of Down • Rapid Capacity
credit, growth of • Cash Conservation Expansion needed
economy caused • Ability to invest • Large number of
more sales Impaired product launches
• Lots of new jobs • Standstill situation • Shift in Demand
• Adhoc capacity • Layoffs and salary Centers
utilization and cuts
expansion
• Standard Products
Automotive Industry at Crossroads
Page 12
13. Recent Automotive Trends….
Stringent Regulations Frugal Engineering
Increasing Fuel Costs, Cost pressures and high
Governments across the volume demand
globe pushing for increased Shorter Advance Engineering
miles-per-gallon from the Phases to meet fast evolving
vehicles market demands
Recent push from Increasing Auto Electronics
Governments on end of life
of vehicles-Assessment EU directive on mandatory use
Legislative Monitoring of LDWS (Lane departure New Market Players
New Emission Regulations Warning System) for commercial
vehicles from 2013 Shifting Economic Gravity
Euro V, BS IV Emerging Consumer Tastes
Increased demand for vehicle
diagnostics
Increasing software complexity
Informed Consumer leading problems resulting in
Richer Experience, Best of vehicle recalls Sophisticated Safety Systems
Features Increased Demand for Safety
Convergence of Consumer from buyers
Industry User Cases Regulations to enforce driver
Improved Mileage and and pedestrian protection
Environmental Awareness
Rapidly accelerating trends posing new challenges
Page13
14. …Resulting into Challenges
External Customer
Stagnating demand and price pressure
Legislation (environment, safety,
in established markets
others)
Segmentation and polarization (low
High Electronics content in the
cost vs. premium)
vehicles
Decreasing loyalty
Raw material and energy costs
Changing product preference(trends
Rapid Globalization
towards smaller and efficient cars)
Auto Industry
Challenges
Industry
Competition
Global overcapacity
Quickly entering every segment
Complex alliances, partnerships, M&As
Moving targets—everyone optimizing
Consolidating ecosystem (suppliers,
or restructuring
dealer groups)
Global game (for example, aggressive
Increased operational efficiency
Asian companies, new entrants)
Structural Changes Reshaping Automotive Industry
Page 14
15. 15 Years of Serving Automotive Customers
UPDT20JUL10
Legend
2011
Global Level Preferred SAP
Partner .
IT Services Collaborate with SAP on Product
Development.
Engineering Services Specialized consulting offering 2010
focused towards eSoA adoption
2009 1,000+ Consultant
Strong SAP Practice
2008 Sparta merger Forte into niche
modules/
Technologies:- CRM,
2006-07 Infotainment SRM, EHS, GRC,
1995-96 2005-06 Platform BPC, Adobe forms,
SAP-KPIT Joint GTM NetWeaver…
(Indian Sub-Continent) Active
contribution to
CG Smith Auto Spice Certified solutions
Inception of SAP Best
Acquisition Level 5 SAP Preferred Partner for Component Mfg
SAP Practice Practices
in LE Space development In India, US, Rental
Inception of Creation of vehicle mySAP All-In- Solution for US
(SAP Labs
Embedded Network OS One
SAP–KPIT Joint COE developments)
Practice product Partnership
SAP Partner in US Autosar R 3.0 Revolo Hybrid
product TVS Harita Acquisition
Page15
16. KPIT Automotive –The Story in.. Numbers
16+OEMs(6 of Top10)
50 Tier I Vendors
8 of Top 10 Semicon Companies
3000+ Engineers
1500+ Projects
300+ Production Programs
100+ SAP implementations And Counting….
30 Patents
Page16
17. Our Differentiator: Leadership in Automotive Domain
Lock Lock
Mirror
Light Light
Door Door
Level Climate
Fan
Seat Chassis
Compressor
Wiper Wiper
Brakes
Damper
GPS
Infotainment BCM Gateway Blind Spot
Cluster
Powertrain Fuel Tank
Switch Seat
Transmission Roof
Keyless
Airbag
TPMS
Light Steering
Immobilizer Door Door
Level
Mirror
Lock Lock
Covers ALL SEGMENTS of the automobile LARGEST Auto Embedded Team in India
From CHIPS MFRs Tier I OEMs Leadership in POWERTRAIN & HYBRID S/W
Page 17
18. A SMART AND SUSTAINABLE SOLUTION
FOR AUTOMOBILES
Page 18
19. The World we live in…
GLOBAL
Well-to-wheel carbon emissions from automobiles
accounted for 8% of all carbon emission in 2008
Vehicle population predicted to grow from 730 million in
2008 to 1.3 billion in 2030
By 2030 the emissions would reach 4.7 Gigatonnes CO2
equivalent
INDIA
18 % emissions due to automobiles amounting to 235
million tonnes CO2 equivalent in 2008
In 2008 Oil import bill for transportation was USD 33
billion
70 % dependency on imports for Oil needs
Increasing automobiles on road: 100 million registered
passenger vehicles in 2008 with 15% growth
Page 19
20. Impact Of An Affordable Hybrid Solution
By 2050, 2/3rd of all vehicles expected to be HEV/PHEV:
Current bottleneck is a well-priced solution
Page 20
21. Hence Potential Leadership Hybrid Solution
A PLUG-IN PARALLEL HYBRID SOLUTION
FROM
IMPACT AUTOMOTIVE SOLUTIONS LTD
6/16/2011 21
22. Setting New Standards Of Value
In-built Intelligence
Providing Engine Assist: the ‘how’ and the ‘when’
Driver Selection for kilometer range of assist
Driving Pattern Recognition: on-going tuning to optimize performance and
economy
>30% Green House Gas Emission Reduction
Enhancing Driving Experience
No Additional Infrastructure requirements
Can be retrofitted on existing vehicles in 4 to 6 hours.
Solution Price Range: Rs.65,000 to Rs.150,000
Performance Results
50% to 80% Efficiency Improvement
30% to 35% reduction in CO2 Emissions
Page 22
23. System Schematic
Control Motor
Battery Pack Motor
Algorithm Controller
ENGINE
Battery Mechanical
Management mounting &
System assembly
KPIT Cummins’
IP component
Sensor Power
Off the shelf Interface transmission
component Module coupling
Page 23
24. Revolo- Joint Venture with Bharat Forge
JV to be formed on a 50:50 Equity Participation
The proposed Equity is Rs. 100 Cr. - To be built over a period of time
JV Board will have 3 Directors each from Bharat Forge and KPIT
Mutual Roles
Bharat Forge
To leverage and make available its manufacturing, assembly and
integration expertise and market access
To provide appropriate government liaison
KPIT Cummins
To bring the technology to the table. KPIT shall license the technology
to the JV for a fixed term
To develop customized solutions for different automotive models,
product engineering and technology roadmap
Page 24
25. R&D (CREST) @ KPIT (34 patents filed till date)
Research on
Customer’s
challenges,
Develop
advanced
solutions
Explore New
Technologies
and Design & develop
Define new products
Technology
Roadmap
CREST
Create IP/ Capability
Patents building
Publish Research In
papers Service Offerings
Page 25
29. KPIT Cummins – The Journey (M&A Progress)
Year of Size at time of FY11
Name Rationale
M&A M&A ($ Mn) ($ Mn)
Anchor Customer – Cummins
Cummins Infotech 2002 $ 1.0 Mn $ 50 Mn
Vertical Focus - Manufacturing
SAP Practice
Panex Consulting 2003 $ 7.2 Mn $ 20 Mn
Anchor Customer
BI Practice
SolvCentral.com 2005 $ 3.5 Mn $ 10 Mn
Anchor Customer
Direct Presence in France
Pivolis 2005 $ 1.5 Mn $ 5 Mn
Geography
Auto Electronics Domain
CG Smith Software 2006 $ 6.25 Mn $ 28 Mn
Auto OEM & Tier I Customers
Harita TVS 2008 $ 1.0 Mn $ 5 Mn MEDS Practice
SAP Practice
Sparta Consulting 2009 $ 25 Mn $ 45 Mn
US Geography presence in SAP
Vehicle Diagnostic &
In2Soft 2010 $ 4 Mn -
Telematics Expertise
CPG 2010 $11 Mn - Oracle Consulting
6/16/2011 29
30. Recent Awards and Associations
Among BEST 5 companies Among BEST 20 leaders
Among BEST 5 companies
by Geography Focus:
by Industry Focus: by Services Offered:
AUTOMOTIVE Industry- Specific JAPAN
- International Association of Outsourcing
- International Association of Outsourcing - International Association of Outsourcing
Professionals (IAOP), Apr ‘09 Professionals (IAOP), Apr ‘09 - Professionals (IAOP), Apr ‘09
Mr. Anil Patwardhan, our CFO was honored with the ‘CFO of the Year in Information Technology Sector’ Award by the Institute of Chartered
Accountants of India (ICAI) for exceptional performance and achievements as CFO in the Information Technology category for 2010.
KPIT Cummins was aawarded the Economic Times Zigwheels, “Automotive Idea of the Year Award” for 2010, for its intelligent plug-in parallel
hybrid solution, REVOLO.
NASSCOM has awarded the “Promising Innovation of the Year, 2011” Award to KPIT Cummins for REVOLO.
REVOLO was also awarded “Bes Electronic Product of the Year 2011” at Indian Semiconductor Association Technovation event.
KPIT Cummins’ REVOLO won a special recognition award for exceptional leadership in catalyzing consumer adoption of sustainable solutions at
the India Carbon Outlook’s Parivartan Sustainability Leadership Awards.
KPIT Cummins’ Hybrid Project Team has won an Award in the category of ‘Innovation’ in the Cummins CMD Awards 2009 . The award was
presented for introducing REVOLO, a smart and sustainable hybrid solution for Automobiles.
Page 30
32. FY11 Performance
Revenues & Margins FY11 Balance Sheet Abstract - March 31, 2011
In Rs. Million (uos) FY11 FY10 Y-o-Y In Rs. Million (uos) March 31, 2011 March 31, 2010
Revenues 10,230.14 7,316.41 39.82% Shareholder’s Equity 6,031.91 3,871.01
Revenues ( $ M ) 224.07 153.76 46.0%
Total Debt 1,105.44 1,107.74
EBITDA 1,522.08 1,614.43 (5.72%)
Cash Balance( inc Investments) 2,572.51 1,799.27
Net Profits 945.82 857.31 10.32%
EPS (Rs.) 11.78 10.97 7.38% Fixed Assets 2,880.62 2,471.54
* Hedging Reserves stood at Rs.136.24 Mn as of March 31, 2011
Operating Performance:
FY2011 revenues crossed the Rs.10Bn milestone with a growth of 40% on Y-o-Y basis.
Gross Profit grew by 12.55% Y-o-Y to Rs.3,630.80Mn, while Gross Profit Margin stands at 35.5%
PAT grew by 10.3% Y-o-Y to Rs.945.82Mn, beating the higher end of upward guidance.
14 customers added in FY2011, taking the total no. of active customers to 155.
Utilization onsite- 89.80%; Utilization offshore-68.48%.
Fixed Price Revenue stood at 30.94% as compared to 30.2% in FY2010.
Total headcount as on March’11 stands at 6,514, net addition of 1,596 employees during the year.
Page 32
33. Q4FY11 Performance
Revenues & Margins Q4 FY11 Balance Sheet Abstract - March 31, 2011
In Rs. Million (uos) Q4FY11 Y-o-Y Q-o-Q In Rs. Million (uos) March 31, 2011 Dec 31, 2010
Revenues 3,081.97 56.37% 12.59% Shareholder’s Equity 6,031.91 4,680.46
Revenues ( $ M ) 67.92 59.18% 12.51%
Total Debt 1,105.44 1,228.79
EBITDA 433.09 12.11% 12.35%
Cash Balance( inc Investments) 2,572.51 1,546.24
Net Profits 263.31 26.68% 4.75%
EPS (Rs.) 3.10 16.98% (2.21%) Fixed Assets 2,880.62 2,719.98
Operating Performance:
Revenue increased by 59.2% Y-o-Y in $ terms, while INR revenue grew by 12.6% Q-o-Q to
Rs.3,081.97Mn.
Gross Profit Margin improved by 102 bps to 35.45%, while Gross Profit grew by 28.31% Y-o-Y to
Rs.1,092.66Mn
Utilization onsite- 90.23%; Utilization offshore-69.88%.
3 new customers were added in Q4 FY2011, taking the total number of active customers to 155.
3 new patents was filed in the quarter, taking the total number of patents filed till date to 34.
Total debt stood at Rs.1,105.44 (Term- Rs.280.80Mn, Working Capital- Rs.785.27 Mn) against
1,228.79Mn as on Dec 31, 2010.
Forex Gain for the quarter stood at Rs.24Mn against Forex loss of Rs.67.6Mn in Q4 FY10.
Page 33
35. FY2012 Priorities & Outlook
Profitable Growth
Innovation- Focus on Non-Linear Revenues
People Development
FY 2012 USD Revenue to be in range of USD 275 Mn-285 Mn, growth of 23%-27%
with INR PAT in the range of Rs.1,150 Mn- Rs.1,200 Mn, growth of 22%-27%.
Page 35
37. Vision
Auto Embedded, Semicon,
SAP, Oracle, ESS,
Best in Business IT
Class
More IP Led Revenues,
Practices
Patent Focus
Non Niche
Vertical
Linear
Growth $ 500 M Focus Automotive, Transportation
& Manufacturing,
by end of Energy & Utilities,
Defense & Government
FY2013
Domain Expertise, Inorganic Presence
Partnership Approach
in Key Emerging Markets along
Growth Geogs with US & Europe
Page 37
38. Focus Segment- Automotive
Increasing Auto
Electronics
Stringent Regulations Auto electronics to Frugal Engineering
Govt. pushing for more comprise 40% of the Shorter Engg phases to
fuel efficiency and strict total cost by 2015 meet fast evolving
emission norms market demands
Sophisticated Safety The World of
Automotive
New Market Players and
Larger demand from end
informed consumer
consumer, Regulations
Real time traffic updates
for pedestrian & Driver
Shifting demand centres
safety
Hybrid solutions, Integrated Environmental compliant solutions (IMDS, RoSH, RRR)
Infotainment solutions on existing and emerging technologies (GENIVI)
Autosar Solutions, proven solutions for OBD, solutions for body electronics, value engineering
Internet enabled telematics development platform
Antilock braking system for electric vehicle, efficient chassis ECU implementation, full vehicle crash
analysis simulation
Focus on India, China and Korea markets to address the new demand centres
Working with leading Auto OEMs and Auto Tier I vendors across the globe
Page 38
39. Focus Segment- Manufacturing
Less Capital Intensive IT
Movement to Emerging Cloud Computing Reduced Time to Market
economies like China, and cost effectiveness
India, Latin America Consultative Approach
The World of
Efficient Manufacturing Manufacturing
Growth in e-commerce,
Process, Effective End
m-commerce
Product
Templatized solutions for rapid and effective ERP implementation
SaaS Model to potential customers with special focus on SMEs
Dedicated sales structure in emerging markets to focus on large and strategic deals
Expertise in Cloud Applications, enabling customers to move IT applications to cloud server
End to End offerings from MES suite, up gradation and consolidation of existing MES
Web based solutions for improving efficiency, proficiency in manufacturing analytics
Practice building in Oracle, SAP, eBiz, SoA and Siebel and reorg to set up consulting practice bringing SCM,
PLM, MES, BPM under one umbrella
Page 39
40. Focus Segment- Energy & Utility
Power Demand will move Smart Grid Management
only in one direction Smart Meter Rollout Energy saving via smart
which is North esp. in power management
emerging markets
The World of Energy
In developed markets and Utility Customer Profiling, Tariff
the need is for cleaner Plan Customization,
energy e.g. Solar, wind Analytics
The above trends call for a lot of electronics and analytics where KPIT has expertise and experience in
solutioning.
US Govt. has made $4.5 Bn. provisioning for smart grid projects.
KPIT has forged strategic partnerships for developing real time solutions for utilities end customer.
KPIT is offering creative and cost effective system integration services around SAP Utilities with
proprietary tools and Intellectual property.
Sachin Tikekar
Page 40
41. Focus Segment- Defense
Indigenization
Obsolescence Revival of Strategic Reduce other country
Upgradation of Battle Programs dependence
Systems Inland Security
The World of
Defense
Low intensity conflict Electronic Warfare
Unmanned Vehicles Robotics, Simulators
The above trends call for a lot of electronics and analytics where KPIT has expertise and experience in
solutioning
KPIT is seeking complementary partnership to go after sub systems business (radar, robotics, sensors,
Launcher etc.) and systems business (Tanks, Aircraft, Submarine, Missiles etc.)
KPIT Customers would be Defense Labs and End user organizations (Army, Navy, Air Force)
KPIT Go to Market Plan is with a dedicated sales force, network of advisors and partnerships by leveraging
the existing competencies with defense labs
Page 41
