INTRODUCTION

._.._'Cl>-

In 1945, two enterprising brothers named

J.C. Mahindra and K.C. Mahindra joined
forces with Guam Mohammed and started
Mahindra & Mohammed as a steel
company in Mumbai.
Two years later, India won its independence,
Guam Mohammed left the company to
become Pakistan's first finance minister
Entered automotive manufacturing in 1947 to
bring the iconic Willis Jeep in India.

INTRODUCTION ...

._.._'Cl>_ _

Keshub Mahindra
- Former Chairman

Anand Mahindra - Chairman

and Managing Director

AUTOMOTIVE

a FARM SECTORS

FINANCIAL SERVICES SECTOR

Flnnclal Serva.
l,_r;ince ~olcJng
Rurill Housrng Anance

Automotive
FannEq~ent

AgrMi111ilMA

Construction EQulPnent

INFORMATION TECHNOLOGY
SECTOR

SYSTECH SECTOR
~
Compontnts

..,formlltlon T~y

StHI
Consulting

Steel

VJ/:)
mah indra

RetaI

Rise

MAHINDRA PARTNERS

TWO WHEELER SECTOR

TWOWhttltrt

lndv5trl.i Equlp '"91'1t

LoglsUcl

l..tw,.Boeb
solar Energy

AFTERMARKET SECTOR
INFRASTRUCTURE a
REALTY SECTOR

IJMd C.1'1 P\Rha1 t SIMS

s....ie.

lnfrallNctuN
Reoill Estate

HOSPITALITY SECTOR

DEFENSE SYSTEMS

Hoqlltillity

o.t-

 US $15.4 billion multinational group with

more than 144,000 employees in over 100
countries across the globe.
New global brand name - Mahindra Rise

mahindra
Rise.

CORE BUSINESS
Revenues by Business Sector
Net Revenue in 2011

5 .1 %
1.4%
1.6%
5 .5%
L

36 , 847.25 Crores

I nfr ast r ucture

H ospita l ity

Fina n c ia l Servi ces

Sys t ec h

6 .9%
9 . 4%

40.4%

IT Services

Farm E qu i pment
Automotive
Others

Market Cap
As of 4 April 2012
Top 5 group companies

$ billion

Mahindra & Mahindra Ltd

8 .41

M ah indra Satyam

1.86

Tec h Mahindra Ltd

1.81

Mahindra & Mahindra Financia l Services L td

1.40

Mahindra Holidays & Resorts Ind ia Ltd

0 . 49

 DURO/ DURO-

DZ
KINE

UTILTY VECHILE/
TRUCKS
MAXl/GIO/ALFA
SUV/ MUV
Scorpio I
bolero/ xylo.

FARM

TRACTORS

EQUIMENTS

..........
..,.,..._!li:k

..

a..i...,.....

trf'--~

FARM
MECHANISMS

racto

e
orld
\.t&M Ltd. is the largest tractor company in the world, by
volume

Utility
Vehicle
Player in
India
M&M Ltd. is the largest utility vehicle company in Indio
SIAM data

AUTOMOBILE INDUSTR-~

Emerging sector and has a potential to improve it.

~ The

increasing GDP and economical resources have

boost up during the last decade which has
increased purchasing power of the Indian peoples.
~"Indian

Passenger Car Market Analysis", the

passenger car market, which constitutes around 78.5/o
of passenger vehicle sales.

KEY PLAYERS
1. TATA MOTORS

./ Market Share: Commercial Vehicles 63.94/o,

./ Passenger Vehicles 16.45/o.
./Tata lndica, India's first fu lly indigenous passenger car.
./Tata Ace, India's first indigenously developed mini-truck.

2. MARUTI SUZUKI INDIA.

0 A subsidiary of Suzuki Motor Corporation of Japan.

DMarket Share: Passenger Vehicles 46.07/o.
0 Ritz, A star, Swift, Wagon-R, Estillo and sedans DZire, SX4 and
Sports Utility vehicle Grand Vitara.

KEY PLAYERS ...

3. Hyundai Motor India

! Hyundai Motor India Limited is a wholly owned subsidiary of

world's fifth largest automobile company.
! Market Share: Passenger Vehicles 14.15/o.
!number one exporter of passenger car of the country for the
sixth year in a row.
! i 10, i20, Verna, Sonata, Accent etc.
4. Mahindra & Mahindra

Market Share: Commercial Vehicles 10.01/o, Passenger

Vehicles 6.50/o.
mainly engaged in the Multi Utility Vehicle and Tractors.
)> expanding its footprint in the overseas market with - XYLO
)>

Indian Auto Industry- Vehicle Sales

I

.0

Sales in '000 vehicles

4 796

Fll growth 29%

2 501 2,617

F08 F09

1,550 1,553
Fll growth 27%

18.2%

F10 F11

Fl l growth 19%

F12

2.4%

685 809
490 384 531

Passenger Veh icles

Commercial Vehicles

365 350 440 526 513

Three Wheelers
Source : SIAM

Tractor Market Share

Total no. of Tractors

100%

303,921

302, 241

400,203

480,377

535,210

136171

90%
80%
70%
60%
50%

23.S

JD

22.3

22.0

20.4

23.4

24.2

FNH
Others
Sonalika
Escorts

30%

Tafe+Eicher

20%

Mahindra

10%
0%

FOB

F09

F10

F11

F12

Apr - Jun

12

Key Factors influencing Automobile

In
~
-
Consumer Sentiment Index
Domestic Goods Price Metal/ Iron and Steel
Import and Export Taxes (Duties) I Motor
Vehicle Tariffs
World Price Energy/ Crude Oil

Inclian a utomobile inclustry SWOT analysis:

STRENGTHS:

WE AKNESS:

Globally cost co111petitive.

Low

Adl1eres to stiict qt1ality controls.

Adoption or Access to latest technology.

researcl1

and

development

capability.
Ind11stry is exposed to cyclical
dovvntl11us in the at1tomoti\re Industiy.
Most compo11e11t co111panies are
depe11dent on global majors for
technology.

OPPORTUNITIES :

THREATS:

Sot1rci11g 11t1b for global a11tomobile Press11re

111aJors.
Export opportl111ities n1ay be realized
tl1ro11gh diversificatio11 of export basket.

011

prices

from

OEM's

co11ti11t1es.
Irnports fro111 FTA Regi111e Co1111tiies, in
certain cou1ponent segments are a threat
to local indt1st1y .
Smaller players, \Vho do not 11pgrade to
global standards. \V011ld get extinct.

SUPPLIERS

Bargaining power of suppliers

INDUSTRY
COMPETITORS
POTENTIAL
ENTRANTS

Threat of
4 - - - - - - - ; SUBSTITUTES
substitutes

Threat of
new entrants
Rivalry among
existing firms

Bargaining power of buyers

BUYERS

THREAT OF NEW ENTRANTS

THREAT OF SUBSTITUTES

SUbstantlal entry

Fajrly mlJ d

New company requires high c.apital.

Other forms of transportation available

Achieving minimum efficient sc.ale Is prohlbltlve

Enter through strategic partnership, buying, merging
Domestic market WOl'ks weU locally than globally

POWER OF SUPPLIERS

POWER OF BUYERS

the power axis Is tipped 1n Industry

The power axtS Is tipped in the consumers' favor

Powerful buyers dictate their terms to suppher

Low switching costs from among competing brands.

RJVARLY AMONG EXISTING FIRMS WITHlN AN INDUSTRY

I ntense due to the entry of foreign companies
Rivalry high with any product being matched In a few months by the competitors
Technical capabilities
Collaboratlon \Yith International players
13

KEY SUCCES FACTORS OF

AUTOMOBILE INDUSTRY

KEY SUCCES FACTORS

Conventiona l sources of cost efficiency include: large-scale plants, low-cost

location, rapid adjustment of capacity to output.
Differentiation through technical specifications
and service quality.

Important Resources & Capabilities -

CORPORATESTRATEG- Federated structure enables each business to

chart its own success.
Economies of scope.
Economies of scale.
Add value to shareholders

DIVERSIFICATION

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~ M&M group have presence in almost 14

sectors
~ From its core business - automobiles it has

diversified in many different sectors

~ Many of them are related and unrelated to its

core business

Related diversified

._.._'Cl>-

when certain stages of the value chains "fit" each

other, we consider such diversification related

SYSTECr.1

UNRELATED DIVERSIFICATISN

t is synergy in Business???
y'
rm is used mostly in the context of mergers
quisitions.
'I'/ from mergers and acquisitions has been
eristically connoted by 2+2=5. It signifies
ment of the performance of the acquired
y by the strength of the acquiring company
ersa.
n of synergies through consolidation and global have been one of the main aims
ldwide M&A activities today

SYNERGY IN M&M GROl:JP-

~

M&M - Navistar Inc USA

~ M&M - Ssangyong Motor Company South
korea
~ M&M - Kinetic Motor Company
~ TECH MAHINDRA- SATYAM

Benefits from the merger-

The following benefits are expected as a result
of the merger:
Enhancement of capabilities across verticals,
Well-balanced geographic exposure,
Well-balanced client mix,
Other profitability related synergies.

ACQUISITION
MAHINDRA REVA
Founded in 1994, the REVA Electric Car Company.
joint venture between the Maini Group of Bangalore
and AEV LLC of USA.
In may 2010 Mahindra group acquire majority stake

1n company

It has about 3,500 electric cars on the road in 24

countries across Europe, Asia and Central and South
America

ACQUISITION
COMPONENT
IT SOLUTION
GLOBAL DISTRIBUTION
FINANCE

REVA

Several International
patents
DESIGN AND
TECHNOLOGY

MAHINDRA REVA IN INDIA Inaugurating the world-class, energy

efficient, green manufacturing plant in
Bangalore - August 2012
capable of producing 30,000 cars per year, is
scheduled to begin production in end of 2012

Future plans of MAHINl3RA

Increase their share in 2 wheeler market in
India and surpass their competitors like
Hero, Bajaj.
Research and development centres for 2
wheeler industry.
Mahindra plans smaller petrol engines for
future compact models of cars.
To go global, and introduce Reva (electric car
in china.