Bharat Electronics Ltd. — Investor Presentation 2020

Nov 19, 2020

प्रति / To,

बीएसई लि. / BSE Ltd. फिरोज़ जीजीबॉय टावर्स Phiroze Jeejeebhoy Towers दलाल स्ट्रीट / Dalal Street मुंबई / Mumbai - 400 001

सं.No. 17565/4/SE/MUMC/SEC दिनांक / Date: 19.11.2020

महोदय / महोदया, Dear Sir/Madam,

भारत इलेक्ट्रॉनिक्स BHARAT FIFCTRONICS

भारत इलेक्ट्रॉनिक्स लिमिटेड

(भारत सरकार का उद्यम, रक्षा मंत्रालय) पंजीकत कार्यालय :

आउटर रिंग रोड, नागवारा, बेंगलूर - 560 045, भारत

Bharat Electronics Limited

(Govt. of India Enterprise, Ministry of Defence) Registered Office : Outer Ring Road, Nagavara, Bangalore - 560 045, INDIA. CIN: L32309KA1954GOI000787 ਟੇलੀफैक्स/Telefax: +91 (80) 25039266 ई-मेल/E-mail : secretary@bel.co.in वेब/Web : www.bel-india.com

विषय- 19 नवंबर, 2020 को विश्लेषकों की बैठक में दी गई प्रस्तुति । Sub: Presentations Made at Analysts Meet held on 19th November, 2020.

हमारे पूर्व के पत्र दिनांक 4 नवंबर, 2020 के क्रम में, कृपया 19 नवंबर, 2020 को आयोजित विश्लेषकों की बैठक में दी गई प्रस्तुति की प्रतिलिपि एतदद्वारा संलग्न पाएं। सेबी (एलओडीआर) विनियम, 2015 के प्रावधानों के अनुसार इसे कंपनी की वेबसाइट पर भी डाला जा रहा है।

In continuation to our earlier letter dated 4th November, 2020, please find enclosed herewith copy of the presentation made at Analysts Meet held on 19th November, 2020. The same is also being put on Company's website as per the provisions of the SEBI (LODR) Regulations, 2015.

सूचना व अभिलेख हेत। This is for your information and record.

सधन्यवाद / Thanking you,

भवदीय / Yours faithfully,

कृते भारत इलेक्ट्रॉनिक्स लिमिटेड For Bharat Electronics Limited

एस/श्रीनिवास / S Sreenivas कंपनी सचिव / Company Secretary

संलग्न- यथा उपर्युक्त Encl: As stated above.

Analyst Meet - 2020

Bharat Electronics Limited

19th Nov, 2020

BEL Overview

Navratna PSU Facilities

• Established in 1954 under Ministry of Defence
• R&D / Technology driven Company operating in Strategic Electronics in Defence & non defence segments
• 61st among top 100 Companies Worldwide in Defence Revenue (Defence News, USA)
• 9102 employees and 4940 Engineers with close to 50% in R&D (Sep 2020)

Subsidiary & JVs Office Network

Subsidiary Companies:

• BEL Optronics Devices Ltd Night Vision Image Intensifier tubes
• BEL Thales Systems Ltd Civil Air Traffic Management Radars and select Defence Radars

Joint Ventures:

• GE BE Pvt Ltd – Medical Electronics Parts, X-Ray Tubes

• Nine Factories all over India having 24 Strategic Business Units
• Two Central Research Laboratories: Bengaluru and Ghaziabad
• One Product Development and Innovation Centre at Bengaluru

Overseas Offices :

USA (New York), Singapore, Oman, Sri Lanka, Vietnam, Myanmar

Marketing /Regional/Liaison Offices:

Bangalore, New Delhi, Mumbai, Visakhapatnam, Kolkata, Nagpur, Agra

Product Support Centers:

New Delhi, Kochi, Guwahati, Kolkata, Port Blair, Mumbai, Visakhapatnam, Karwar, Jammu, Chandigarh, Allahabad, Jodhpur, Sulur and Bhatinda

Business Segments

Multi product, Multi technology company – Diverse product range

Areas of Diversification

Research & Development (R&D)

• 47% Engineering Manpower deployed in R&D
• 79% Sales Revenue from Indigenous R&D
• R&D investment: Rs. 947 Crs during 2019-20
• CMMi Level-5 Certification for Software development
• Largest Production Partner of DRDO
• Patents Application Filed 375 Patents, Granted 10

Central Research Labs(2 Centers)	Blue Sky Research (Futuristic Technologies)(Radio Frequency & Microwave; Embedded Computing System;Radar Signal Processing; Communication (Software DefinedRadio & Wireless); Network Centric Software; Sensor SignalProcessing; Very Large Scale Integration; Smart ComputingSystem; Networking; Sensor Data Fusion; AI ; Robotics
Product Development &Innovation Center	Core Technology Module development Groups(Defence Software; Encryption; Radio Frequency; Microwave;Radar Signal Processing; Power Supply; Control Electronics,Embedded System; Computing Elements; Electro Optics,Communications)
Development & Engineering Groups(22 Centers)	Products & Systems development

Expansion & Modernization

• World Class Manufacturing & Test facilities established for:

Super Components, Test Set-up for Missile System, EVM/ VVPAT, Antenna Test range, EMI / EMC Test, Composite Manufacturing.

• Building New Manufacturing facilities at Nimmaluru, Palasamudram (Andhra Pradesh) & Ibrahimpatnam (Telangana)
• Acquired land in Devanahalli (Bengaluru) & Nagpur
• Established Product Support/Service Centres

• Dedicated Business Unit & Marketing Group for Exports . Dedicated Business Unit & Marketing Group for ExportsAchieved USD 48.59 Million during the year
• Achieved USD 48.59 Million during the year 19-20. 19-20.
• Export Initiatives: Export Initiatives:
  • Overseas marketing offices in USA, Singapore, Oman, Srilanka, Vietnam, Myanmar. . Overseas marketing offices in USA, Singapore, Oman, Srilanka, Vietnam, Myanmar.
  • Strategic alliances with global OEMs (Elbit, IAI, Thales, SAAB) for joint development / co-production . Strategic alliances with global OEMs (Elbit, IAI, Thales, SAAB) for joint development / co-production
  • Focus on SE Asian Countries for Communication, Sonars and Coastal Security solutions

• Major products exported: Major products exported:

• Weapon Locating Radar, Coastal Surveillance System, Communication Equipment's, Data Link, IFF – Interrogator, Radar Finger Printing System, TR Modules, Mechanical Parts (Contract Manufacturing Services), EOS, Cable Looms, etc. . Weapon Locating Radar, CoastalSurveillance System, Communication Equipment's, Data Link, IFF - Interrogator, Radar Finger Printing System, TR Modules, Mechanical Parts (Contract Manufacturing Services), EOS, Cable Looms, etc.
• Major countries: Major countries:
  • France, Oman, USA, Germany, Switzerland, Armenia, Srilanka, Sweden, Israel, Indonesia, Seychelles, Mauritius, Guinea, Namibia, China, etc. France, Oman, USA, Germany, Switzerland, Armenia, Srilanka, Sweden, Israel, Indonesia, Seychelles, Mauritius, Guinea,

Long Range Surface to Air Missile

Integrated Air Command & Control System

Thermal Imaging Sight

TROPO Upgrade

Low Level Transportable Radar (LLTR)

Smart City Business Weapon Locating Radar

Ground Based Mobile Electronic Intelligence System

Low Intensity Conflict Electronic Warfare System (LIC EWS)

New Products Introduced in 2019-20

• Ship-to-Shore Communication System
• Systems for Akash NG
• Dip brazed Chassis
• Battlefield Surveillance System High Altitude Area (BSS HAA)
• CDMA Based wireless communication system
• Instant Fire Detection and Suppression System (IFDSS)
• Software Defined Radio (SDR) -TAC
• Missile Data Link Unit
• Tethered Un-Manned Aerial Vehicle (TUAV)
• Hand Held Function Signal Generator

Order Book

Major Orders Received during 2019-20

• Akash Missile System (7 Sqdn)
• Coastal Surveillance System Phase II
• Upgrade of EW System
• Annual Maintenance Contracts
• Software Defined Radios
• Smart City Business

Orders Received during current year is around Rs. 5200 Cr. The current Order Book is around Rs. 52700 Cr..

Major Projects planned during 2020-21

• LRSAM (Long Range Surface to Air Missile)
• Integrated Air Command & Control System
• Ventilators
• Akash Missile System (7 Sqdn)
• Smart City Business
• Thermal Imaging cameras
• Upgrade of Communication Equipment
• Fuzes
• Naval Equipment
• Radars
• Avionics Package for LCA

Business Initiatives

• Creation of new SBU in the area of Advanced Defence Systems-Navy (ADSN)
• Creation of Separate Business Verticals to address Seekers & Missiles, Solar Power Systems, Un-manned Systems & Energy Storage Products business.
• MoUs signed with several Industry players, startups and academic institutions for technology / Business partnerships
• Focus on Make-II Programs
• Enhanced engagement with Start-ups for emerging/disruptive technologies and new Business areas.

• Full scale operationalization of Overseas Marketing Offices in Vietnam, Myanmar, Sri Lanka & Oman.
• Singapore & New York Offices expanded with marketing cell.
• Established new State-of-the-art manufacturing facility for Composite Material, Environmental Testing & Finishing at Navi Mumbai Unit.
• Platinum Level recognition for BEL Ghaziabad & Hyderabad Units in CII EXIM Bank Business Excellence Awards
• CMMI Level-5 to 2 more SW Centres and Level-3 for 3 SW Centres of BEL.

Business Initiatives

• Major Capital expansion projects under progress at Palasamudram, Nimmaluru, Aerospace Park, Bangalore, Nagpur, RPSC Centers etc
• During last 5 years, 326 Patents/191 Copyrights were filed, out of which 4 Patents/ 187 Copyrights have been granted.
• Established Innovation Cell in IITM.

'Make in India' Initiatives

• EoIs for 55 items published under Make-II of which 23 items are in various advanced stages of indigenization.
• As part of Atma-nirbhar Bharat initiative, 195 items have been targeted for indigenization during 2020-21.

• Significant measures taken to enhance procurement through GeM.
• BEL's Test facilities are being provided to Private vendors.

Outlook for the Future

• BEL to focus on R&D both in-house and collaborative Mode for increased value addition and intellectual property creation.
• Enhanced Partnerships with DRDO labs, research and academic institutions, Startups as well as with niche technology companies & consultants
• Creation of Centres of Excellence(CoE) in R&D
• Thrust on Exports by expanding geo-spatial reach & partnerships.
• Diversify into new and allied Business areas to drive BEL's growth
• New areas identified include Medical Electronics, Energy Storage Products including e-Charging Stations, Unmanned Systems, Space Electronics, Satellite Launch Vehicles, Solar Cells/Modules, Seekers and Missiles, Network & Cyber Security, Arms

Financial Performance

				(`In Crores)
	2NDQTR(20-21)	Half Year(20-21)	Half Year(19-20)	FY 19-20
TURNOVER	3165	4805	4703	12608
EBITDA	623	770	893	2730
EBITDA Margin (%)	19.55	15.85	18.43	21.13
PAT	397	451	544	1794

Financial Highlights (FY 20)

• Net worth : ` 9853 Crores.
• Book value Per Share : ` 40.44
• EPS : `7.36
• Capital expenditure : ` 513 Crores.
• R&D expenditure : ` 947 Crores.

Margin /Return Over a Period Of 5 Years

• Return on Capital Employed : 13.94 % to 23.56 %.
• Return on Net Worth : 15.50% to 19.01 %.
• EBITDA : **1372 Cr to** 2730 Cr.
• EBITDA Margin : 18.72 % to 21.13 %.
• EPS : **4.95 to** 7.36.

HOW A RUPEE EARNED IS DISTRIBUTED (FY 20)

SHARE HOLDING PATTERN

SL.NO.	CATEGORY	As on31.03.2020(%)	As on31.09.2020*(%)
1	GOVERNMENT OF INDIA	51.14%	51.14%
2	MUTUAL FUNDS	25.11%	25.57%
3	FOREIGN INSTITUTIONALINVESTORS	10.71%	9.60%
4	OTHERS	8.31%	8.40%
5	INSURANCE COMPANIES	4.73%	5.29%
	TOTAL SHARE CAPITAL (` in Cr)	100.00%	100.00%

*Others includes: Corporate Bodies(.91%),NRI's(.39%) ,Banks & FI's(.33%),Individuals (6.23 %)