TIMKEN INDIA LIMITED

…for a favorable Bearing on your PF!

 Disclaimer
■ The following slides pertaining to a Company listed on the NSE & BSE are ONLY FOR THE
PURPOSE OF INFORMATION and should not purport to be treated, accepted or understood as a
RECOMMENDATION to buy/sell
■ The information shared in this presentation is based on the inputs available within the public
domain and as disclosed by the Company in its various interactions with the investor community
and to the exchanges
■ The stock could possibly feature as a recommendation to clients of ALTAMOUNT CAPITAL
MANAGEMENT at some point of time in the past or future as part of the advisory services offered
by the group to its clients
■ ALTAMOUNT CAPITAL MANAGEMENT is a SEBI Registered Advisor under the RIA Guidelines
■ Do your own homework! (…..just spending 5000 bucks for 20 Ideas is not necessarily enough to
make a portfolio)

20 - 20
 Introduction to the Company
■ Here’s a leader in the niche segments of engineered bearings and mechanical power
transmission products
■ Global footprint, with a virtual who’s who of customers base; the Indian business clearly gearing
up to support the global presence beyond domestic growth
■ Follows a partnership model with most customers in terms of developing solutions and
applications and are known to work very closely from an early stage of the product development
cycle with key clients
■ Strong commitment from the promoter group to be in the business and clear signs of seeking
growth within the Indian context (promoter holding has been at 75% or more at most times since
the company’s inception, in recent years diluted to ~68% on account of the ABC acquisition
■ On the forefront of new-age solutions like Electric & Hybrid vehicles using the proprietary Power
Dense Fuel Efficient (PDFE) and Micro-geometry technology
■ Recent acquisition (2018) of ABC Bearings makes it a formidable play with a full range product
suite

20 - 20
 How is the business positioned?
Post the ABC acquisition, the business of TIL straddles pretty much the entire spectrum of
bearing solutions
3 Categories / Segment of Bearing Solutions

Differential Pinion Wheel-end

Market share of Market size of

60-90% 400 Crs

20 - 20
 How is the business positioned?
Segments of the India Business

Industrial Automotive Agri Equipment

Railways OEM Tractors

Freight / Passenger /
Locomotive
Replacement Pumps
Wind power
Turbines / Gearboxes
Off roaders
Motors &
Compressors

Cement

Steel
20 - 20
 A Quick look at the numbers

■ Size of the biz – not too small, neither too big (Mkt Cap ~ 52 Bn INR)
■ Upwardly trending topline (FY19 growth of 35% at 1664 Crs INR)
■ Improving trend of margins (clocked 17.4% in FY19)
■ Clear evidence of FCF generation (yields of 3%)
■ Healthy Return Ratios (in the range of 18-20%)
■ Visibility of EBITDA growth (18-19% range)
■ Reasonable valuations (15x EV multiples)
■ Strong B/S (Reserves of close to 1300 crs + no leverage)

20 - 20
 Growth triggers
■ Railways as a segment could bring in some positive surprises on the growth front
with the following promising areas :

– Trend of higher-end passenger coaches (LHB)

– Capex on rolling stock to go up significantly

– Metro and Locomotive growth, particularly high-speed trains

– Outsourcing of workshops – drive higher replacement demand

State-of-the-art
– DFC implementation Recently executed a
facility at
500 Mn INR order
Jamshedpur for
from CONCOR for
repair & refurb
Class K bearings
20 - 20
 Growth triggers
■ Exports, particularly utilizing the ABC facilities is a big area that is likely to open up

– The slowdown in the North American Class VIII trucks (account for 50% of
exports last year) is being offset by improving traction from South African
mining equipment exports

– Bharuch unit of ABC is being upgraded to introduce CRB & SRB categories,
exclusively to focus on the exports market

– OEM relationships of the parent are being leveraged while the qualification of
the ABC units is underway
Capacity utilization Capex of 350 – 400
has consciously Mn INR is planned
been ramped up towards process
gradually to achieve improvement
this
20 - 20
 Growth triggers
■ Wind power solutions is another area of specialization that the Company is gearing
to leverage upon

– Expertise to offer best-in-class solutions across the globe is now being

leveraged to expand this portfolio A capex of 800 – 1000 Mn is planned towards mfg of
complex components & localization of parts

– Key supplies to players such as SIEMENS, ZF, who are exporting gearboxes
from India

– Focus on reducing downtimes in the wind power generation ecosystem offers

an opportunity to establish mission critical presence for the Co
Co’s design unit out
Leads to a very of Bengaluru is
superior margin delivering world
profile class applications
20 - 20
 Happy Alpha Generation!

Thank You!

20 - 20