Pricol Limited — AGM Information 2018

Aug 23, 2018

Y ™pnco/ PR/COL LIMITED (Formerly Pricol Pune Limited] Passion to Excel

109, Race Course, Coimbatore 641018 , India

'- +91 422 4336000 ltm +91 422 4336299 ~city@pricol.co.in e pricol . com

CIN : L34200TZ2011 PLC02219 4

• CUSTOMERS • EMPLOYEES • SHAREHOLDERS ;..._ SUPPLIERS

PL/SEC/TGT/2018-19/100 Thursday,August23, 2018

Corporate Relationship Department	The Manager
BSE Limited	Listing Department
1st Floor, New Trading Ring	National Stock Exchange of India Limited
Rotunda Building, P J Towers,	"Exchange Plaza' , C-1 , Block G
Dalal Street, Fort	Bandra-Kurla Complex,
Mumbai 400 001	Sandra (E), Mumbai - 400051
Scrip Code: 540293	Scrip Code : PRICOLL TD

Dear Sir,

Sub: 7thAnnual General Meeting - (1) AGM Proceedings (2) Presentation made at the Meeting

We wish to inform you that the 7thAnnual General Meeting of the Company held on August 22, 2018 at Chamber Hall, Chamber Towers, 8/732, Avinashi Road, Coimbatore-641 018 and the business(es) mentioned in the notice of the 7th AGM dated 26th June, 2018 were transacted.

In this regard we are enclosing the following :

1. Proceedings of AGM as required under Regulation 30, Part-A of Schedule-I II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

2. Presentation made at the Annual General Meeting

We request you to kindly take the same on record and acknowledge receipt.

Thanking you,

Yours faithfully, For Pricol Limited-

i.~.Thamizhanban Company Secretary 1cs1· M.No: F7897

Encl: as above

ISO/TS16949 BUREAU VERITAS Certification·

Proceedings of the 7th Annual General Meeting of Pricol Limited held on Wednesday, the 22nd August 2018 at 4.30 p.m. at Chamber Hall, Chamber Towers, 8/732, Avinashi Road, Coimbatore - 641 018, Tamilnadu.

Meeting started at 4.30 p.m. Meetin ended at 6.15 p.m.

PRESENT

DIRECTORS

• 1. Mrs.Vanitha Mohan, Chairman
• 1. Mr.Vikram Mohan, Managing Director
• 1. Mr.R.Vidhya Shankar, Chairman Audit Committee,

Stakeholders Relationship Committee & Nomination and Remuneration Committee

COMPANY SECRETARY DIRECTOR FINANCE (CFO) STATUTORY AUDITOR Mr.T.G.Thamizhanban Mr.J.Sridhar SECRETARIAL AUDITOR & SCRUTINISER Mr.V.S.Srinivasan, VKS Aiyer & Co., Mr. P. Eswaramoorthy, Proprietor, P.Eswaramoorthy and Company

The following Registers / documents as required under Companies Act, 2013 were kept open for inspection of members at the commencement of Annual General Meeting and remained open and accessible during the continuance of the meeting to the persons having right to attend the meeting.

• a) Register of Directors & Key Managerial Personnel and their Shareholding (U/S.170)
• . b) Register of Contracts or Arrangements in which directors are interested (U/S 189 )
• c) Statutory Auditors Report for the year ended 31 st March 2018
• d) Secretarial Auditors Report for the year ·ended 31st March 2018

Mrs.Vanitha Mohan chaired the Meeting.

The requisite quorum being present as required under Section 103 of the Companies Act, 2013, the Chairman declared the meeting as properly constituted and called the meeting to order.

Chairman welcomed the members to the 7th Annual General Meeting of the Company.

Chairman explained that Mr.Suresh Jagannathan, Mr.G.Soundararajan, Mrs.Sriya Chari and Mr.S.K.Sundararaman Directors of the Company were unable to attend the meeting.

Chairman informed that with the permission of the Members present at the meeting, since the following had been already circulated were taken as read.

• a) the 7th Annual General Meeting Notice, Directors' Report along with the Annexures thereto, the Annual Financial Statements, the Consolidated Financial Statements for the financial year ended 31 st March 2018
• b) the Unqualified Statutory Auditor's Report for the financial year ended 31 st March 2018 and
• c) the Unqualified Secretarial Auditor's Report for the financial year ended 31 st March 2018.

Chairman informed that there was no qualification or adverse remark in the Statutory Auditors Report (Standalone & Consolidated) and Secretarial Auditors Report for the financial year ended 31st March 2018.

Mr.Vikram Mohan, Managing Director made a presentation & explained in detail on Financial Performance - FY 2017-18, New Business Wins, Company Outlook FY 2018-19, Subsidiary Companies - Financial performance, Key Investments & New Plants, Key Partnerships, Corporate Social Responsibility.

Chairman invited queries from the members and the queries were answered in detail.

AGM Resolutions

Chairman informed the members that the following resolutions were recommended by the board for the approval of members of the company:

ItemNo	,, .Details of the Businesstr	Type ofResolution
1	Adoption of Financial Statements and Reports of theBoardofDirectors and Auditors	Ordinary
2	Declaration of Dividend for the financial year 2017-18-1 -	Ordinary
3	Re-appointment of Mrs.Vanitha Mohan , (DIN:00002168), who retiresby rotation, as a Director	Qrdinary
4	Appointment of Statutory Auditors to fill casual vacancy -(M/s.VKS Aiyer & Co,) .
5	Appointment of Statutory Auditors for a term of 5 years -M/s.V~_S-Aiyer & Co,	Ordinary
6	Appointment & Remuneration to Mrs.Vanitha Mohan, Chairman	Special
7	AppointmentofMr. S. K. Sundararaman(DIN:00002691 ),asanIndependent Director for a term of 5 years	Ordinary
8	Authorisation for conversion of Loans of the company into Equityshares as per Loan Agreement	Special
~	Reclassification of Promoter & Promoter Group	Ordinary
	-1 o· RatificationofremunerationpayabletoCostAuditorMr.G Sivagurunathan, Cost Accountant	Ordinary

Chairman informed that pursuant to the provisions of Section 108 of the Companies Act, 2013 read with the Rule 20 of the Companies (Management and Administration) Rules, 2014 and Regulation 44 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2016, the Company had provided the E-voting facility to the Members of the

Company in respect of the 7th Annual General Meeting resolutions. The remote evoting commenced on 18th August 2018 (9.00 a.m) and ended on 21 st August 2018 (5.00 pm).

She further informed that facility to vote through ballot paper had been arranged, for the members who attended the meeting and who had not already cast their vote through Evoting. She informed that M/s.P.Eswaramoorthy and Company, Company Secretaries, was appointed as Scrutiniser, to scrutinise the E-Voting and Ballot Process at AGM.

Chairman informed the members present at the meeting and who had not already cast their vote through e-voting, to cast their vote through ballot paper and deposited it in the ballot box kept at the AGM premises.

Chairman informed the members that the Scrutiniser shall submit a consolidated scrutiniser's report (E-Voting & Ballot) within 48 hours of the conclusion of this AGM. The results along with the scrutiniser's report ~hall be placed on the Company's website, notice board of the Company and communicated to the Stock Exchanges.

The requisite quorum was present throughout the AGM proceedings.

The meeting concluded.

for pricol lim~ TC:ban Com pany Secretary

Slide 1

7

Welcome to Pricol Limited's th Annual General Meeting 22 August 2018

Agenda

Financial Performance FY 2017-18

New Business Wins

Key Investments & New Plants

Key Partnerships

Corporate Social Responsibility

Company Outlook FY 2018-19

Financial Performance FY 2017-18

• Pricol's standalone revenue from operations grew by 14% (excluding Speed Limiting Devices) and stood at INR 1176.71 crores in FY 17-18
• Reduction in Sales and EBITDA is mainly due to drop in Speed Limiting Devices; a high profit product due to the implementation of Bharat Stage IV norms
• Cash generation through operations is INR 74.46 crores in FY 17-18 as against INR 111.54 crores in FY 16-17

Standalone Financial Performance FY 17-18: Operations

Particulars	FY17-18	FY 16-17
Revenue from operations(excluding excise duty)	1176.71	1215.65
Profit beforeTax	74.22	62.32
EBITDA	107.46	134.43
% of Revenue	9.13%	11.06%

Standalone Financial Performance FY 17-18: Total Revenue

		(In INR crores)
Particulars	FY17-18	FY 16-17
TotalRevenue(excluding excise duty)	1322.05	1270.14
EBITDA% of Revenue	157.1811.88 %	136.1610.72 %

• Total reported revenue stood at INR 1351.23 crores in FY 17-18 and it includes the following:
  • Sale of land held as stock in trade to the tune of INR 83.76 crores
  • Sale of traded goods to the tune of INR 56.79 crores
  • Other income is to the tune of INR 4.8 crores
  • Cash generation through non operational revenue is INR 71.30 crores in FY 17-18

Standalone Vehicle Segment Wise Growth FY 17-18

Segment	Growth1Pricol's	2Market Growth
Two Wheeler	15%	16%
Commercial Vehicle	39%	10%
Off Road Vehicle	13%	13%
Tractor	14%	22%
Four Wheeler	-5%	5%

• 1. Growth rate is based on sales to OEMs but not including Exports, SLD, Components, Tools, Aftermarket, SCMS, Telematics
• 1. Source for Market Growth: ET Auto and SIAM

Segment	FY 17-18	FY 16-17	Growth %
Driver Information System	570.0	509.6	12%
Switches and Sensors	149.9	132.9	13%
Pumps and MechanicalProducts	345.8	318.0	9%
Asset Management Solutions	29.7	25.7	16%
Auto Accessories & Others	65.1	29.8	118%
Total	1160.4	1016.0	14%
SLD	12.2	198.7	-94%
Grand Total	1172.6	1214.7	-3%

Standalone Revenue Split by Product Vertical

Pricol Do Brasil – Restructuring Process

• Company shifted its manufacturing facility from Diadema to Jarinu to reduce employee and operational cost and started production and supplies to the customer in Nov 2017
• PdB has severed 181 employees from Aug 2017 to Mar 2018 and hired 125 employee from Jarinu.
• Employee cost is expected to be reduced from 45% to 23%
• Invested in new machinery and created additional production capacity to better align to OEM's new programs.
• Major customers like Volkswagen, General Motors and Fiat are supporting this process by extending price increases, stock build up, reduced payment terms and faster production part approvals

Particulars	FY17-18	FY 16-17
Revenue	127.81	123.38
-Domestic	107.92	111.56
-Exports	19.89	11.82
EBITDA	(26.86)	(31.30)
% of Revenue	-21.0%	-25.37%

Pricol Do Brasil – Financial Performance FY 17-18

• PdB incurred a loss of BRL 45.163 Mn (INR 91.41 crores) in FY 17-18 as against BRL 22.224 Mn (INR 43.56 crores) in FY 16-17
• Loss during the year includes BRL 18.556 Mn (INR 37.55 crores) towards employee settlement and BRL 1.516 Mn (INR 3.06 crores) towards relocation expenses.

FY18-19	FY 18-19
(Q1) ABP	(Q1) Actual
37.48	36.21
29.88	21.70
7.61	14.51
0.29	0.92
0.78%	2.54%

Particulars	FY17-18	FY16-17
Revenue	40.44	92.24
Profit before Tax	2.69	0.98
% of Revenue	6.65%	1.06%

Pricol Indonesia – Financial Performance FY 17-18

• Phasing out of Honda vehicle model was a major contribution for sales decrease
• Cost control measures improved the profitability
• 100% Acquisition of PT Sripri Wiring Systems manufacturing wiring harness completed
• Slow growth of domestic Indonesian market is attributed to rising fuel prices and devaluation of Indonesian Currency.

Pricol Wiping Systems Financial Performance FY 17-18

• Pricol completed acquisition of wiping systems business from PMP Auto Components in August 2017
• Financial reporting is considered for the period from Sep 2017 till Mar 2018 being the effective period of control
• Start of production for new business wins for customers like Volkswagen and SEAT strengthened the order pipeline during FY 17-18

• Pricol's consolidated revenue from operations grew by 10.23% and stood at INR 1568.6 crores in FY 17-18
• Cash generation is INR 58.47 crores in FY 17-18 as against INR 78.46 crores in FY 16-17

Consolidated Financial Performance FY 2017-18

Particulars	FY17-18	FY 16-17
Revenue from operations	1568.60	1423.04
Profit beforeTax	(28.44)	26.02
EBITDA	77.25	121.34
% of Revenue	4.92%	7.89%

Bluetooth Connectivity In India

Product	:	First ever scooter with
Customer	:	TVS Motors Limited
Model	:	NTORQ
Market	:	India

	ProductCustomerModelMarket	:Instrument Cluster:KTM:Husqvarna:India & Austria
--	----------------------------------------	-------------------------------------------------------------------------------

Pressure Monitoring System

	ProductCustomerModelMarket	::::	Digital Cluster with TyrePressure Monitoring SystemTata Motors LimitedXenonIndia
--	----------------------------------------	------------------	--------------------------------------------------------------------------------------------------

	ProductCustomerModelMarket	:Cluster for Tata Motors' EVthrough JayemAutomotive:JayemAutomotive Private Ltd:Electric Vehicle (EV) -Car:India
--	----------------------------------------	--------------------------------------------------------------------------------------------------------------------------------------------------------------

Product	:	Water Pump
Customer	:	Caterpillar
Model	:	Engine variants
Market	:	USA

	ProductCustomerModelMarket	:Oil Pump:Harley Davidson:Motorcycle variants:USA
--	----------------------------------------	-------------------------------------------------------------------------------	--

Product	:	Water Pump
Customer	:	Volkswagen
Model	:	EA 211 EVO
Market	:	North America

	ProductCustomerModelMarket	:Water Pump CSS Prime:General Motors:CSS Prime Engine:South America
--	----------------------------------------	-------------------------------------------------------------------------------------------------

Product : Wide range of warning clusters Model : Mini Excavator, 3CX Compact

Effective and Efficient TFT Clusters

Slide 21

Company Outlook FY 2018-19

• Business is expected to grow by 15% to 18% due to both organic growth and new projects
• New products in pipeline will contribute an expected revenue of around INR 180 crores across all product verticals.
• Capex heavy for growth as investments are made in new plants and machineries to support business growth in FY 2017-18 and FY 2018-19
• Light sustenance capex is forecasted in FY 2019-20 and FY 2020-21 to support business growth

Standalone Outlook for FY 2018-19

2

Segment	Growth1Expected Pricol's	Expected Market Growth
Two Wheeler	16%	11-13%
Commercial Vehicle	31%	8-10%
Tractor and Off Road Vehicle	51%	15-20%

• 1. Growth rate is based on sales to OEMs but not including Exports, SLD, Components, Tools, Aftermarket, SCMS, Telematics
• 1. Source for Market Growth: ET Auto and SIAM

• Increase in Raw Material Costs due to the following:
  • Rupee weakening and commodity price increase
  • Global electronic shortage for key components leading to a 30% price increase of such components
• Main impact of the material cost increase is realized in Q1 & Q2 due to time lag in recovering the price increase from customers
• 400+ workmen are recruited for Hosur, Sricity and Manesar four months prior to commencing operations to ensure proper quality from day one

Standalone Outlook for FY 2018-19

Standalone Revenue Split by Product Verticals

Segment	FY 18-19Plan	FY 17-18Actuals	Growth %
Driver Information System	674.3	570.0	18%
Switches and Sensors	170.0	149.9	13%
Pumps and MechanicalProducts	403.9	345.8	17%
Asset Management Solutions	41.5	29.7	40%
Auto Accessories & Others	76.0	65.1	17%
Total	1365.7	1160.4	18%
SLD	12.1	12.2	-1%
Grand Total	1377.8	1172.6	17%

Particulars	Pricol do Brasil	PT Pricol SuryaIndonesia	Pricol Wiping Systems(Czech, Mexico &India)
Revenue	155 –160	35 -40	440 -450
EBITDA	4.5 –5 %	8 %	5-6 %

Subsidiaries Financial Outlook FY 18-19

				(In INR crores)
--	--	--	--	-----------------

• CSS prime project is a major milestone for the company with expected annual revenues of INR 90 crores (BRL 45 MN) and a forecasted production ramp up from April 2019.
• Water Pump program in collaboration with Pricol Wiping Systems Mexico for VW Mexico Eco engine platform by end of 2020 with an expected business of INR 130 crore
• Brazil has seen some relief with 2017 GDP growth of 1% to BRL 6.559 trillion (USD 2 trillion) after the recession that impacted Brazil's economy in 2015 (-3.5%) and 2016 (-3.5%)
• Automotive sector has indeed helped the economic recovery. Vehicle production increased by 25% to 2.70 million vehicles in 2017 from 2.15 million in 2016 (contributed by exports which grew 46.5% and local sales growth of 9%), ending a 3 consecutive year decline in vehicle production.
• In 2018, GDP growth is forecasted at 2.75% and an increase of 13% in automotive sector

Pricol Do Brasil – Future Outlook

Pricol Indonesia – Future Outlook

• The Government of Indonesia is coming up with a project for a low cost vehicle model aimed at the middle class and village segments of Indonesia.
• PT. Pricol Surya Indonesia has been chosen for the supply of instrument cluster and wiring harness for this low cost vehicle
• Expects a revenue growth in FY 2019-20, due to the above new business and potential RFQs from customers like Harley Davidson for oil pump and Kawasaki for instrument cluster
• Potential business is expected from Piaggio, Daihatsu etc. in the next two years

Pricol Wiping Systems – Acquisition Highlights

• Pricol completed acquisition of wiping systems business from PMP Auto Components in August 2017
• The acquisition of the Czech Wiping Systems business viz., PMP PAL International (PAL Intl.) was completed through its investment subsidiary Pricol Wiping Systems Czech (PWS Czech).
• The merger of PWS Czech and PAL Intl. was completed on 1 st April 2018. PWS Czech is the surviving entity.
• Name of the Mexican subsidiary was changed to Pricol Wiping Systems Mexico in December 2017 from former PMP Auto Mexico.
• Pricol Limited incorporated Pricol Wiping Systems India Limited as its wholly owned subsidiary.

Pricol Wiping Systems – Post Acquisition Improvements

Supply Chain Improvements

• Resourcing efforts to exponentially reduce quality/delivery issues being undertaken in Czech after receiving customer approvals
• Resourcing for bottleneck suppliers completed in India and the same has started to positively impact in delivery performance

Manufacturing and Productivity Improvements

• Streamlining the shop floor layout and implementation of asset monitoring systems are being carried out in Czech to better align with production goals
• Reduced number of shifts and improved per person productivity and implementation of shop floor disciplines are undertaken in India.

Engineering and Development

• Alignment with Pricol Technology Centre (Corporate Engineering) initiated
• Development of technology roadmap and expediting ongoing development of reversing wiper motor and 4 pole motors

Pricol Wiping Systems Future Outlook

New technology development for Four Pole Motor and Reversible Motor in collaboration with ZSI Technology, Germany

Czech

• Start of Production for the Audi's new programme in Q1 2018
• Additional volumes won from Volkswagen and Seat

India

• Initiated Start of Production for Maruti Suzuki India's key platform
• 2 projects for India's largest Commercial Vehicle makers under progress
• Targeting additional business with newly announced Skoda focus in India by Volkswagen apart from the current business.
• Price correction exercise with existing customers being carried out

Key Investments & New Plants

Capex Investment in FY 17-18

Particulars	FY 17-18
Building & Infrastructure	28.63
Plant & Machinery	42.20
Others*	12.76
Tooling	18.47
Standalone Total Capex	102.06

(In INR crores)

FY 17-18

Capex for Pricol Wiping Systems 13.00

Capex for Pricol do Brasil 26.00

Consolidated capex investment in FY 17-18 is around INR 141 crores.

*Others include test lab and quality lab equipment, Design & Information Technology – Software & Hardware

Planned Capex Investment in FY 18-19

Plan

FY 18-19Plan
51.20
80.20
13.25
31.43
176.09

(In INR crores)

Capex for Pricol Wiping Systems 40.00

Capex for Pricol do Brasil 10.00

Consolidated planned capex investment for new plants and machineries is around INR 225 crores in FY 18-19 to support new projects and capacity expansion

*Others include test lab and quality lab equipment, Design & Information Technology – Software & Hardware

98,000 sq ft of area and fully operational by Aug 2018 First invoicing completed in June 2018 2 nd Manufacturing unit in Manesar 9 th Manufacturing unit in India Investment ~ INR 7.5 crores

New Plant – Manesar, Haryana (Plant 9)

5.86 acres of land with building area of 48,000 sq ft in Phase I Expected to be fully operational by Oct 2018 10th Manufacturing plant in India for Pricol Greenfield Manufacturing plant 250kw rooftop solar Investment ~ INR 32 crores

New Plant – Sricity, Andhra Pradesh (Plant 10)

5.55 acres of land with building area of 51,000 sq ft in Phase I Expected to be fully operational by Nov/Dec 2018 11th Manufacturing plant in India for Pricol Greenfield Manufacturing plant 250kw rooftop solar Investment ~ INR 42 crores

New Plant – Hosur, Tamilnadu (Plant 11)

Oxygen Sensor Assembly Line

Key Investments FY 17-18

2 nd SMD line for PCB in Plant 2

No Fault Forward Assembly Line for Mechanical DIS

Key Investments FY 17-18

No Fault Forward Assembly Line for Electronic DIS

Fuel Pump Module Assembly Line in Plant 2

Key Investments FY 17-18

Semi-Automatic Four Stroke Oil Pump Assembly Line in Plant 3 for Ashok Leyland

Water Pump Assembly Line in Plant 3 for Harley Davidson

Key Investments FY 17-18

Oil Pump Assembly Line in Plant 3 for Royal Enfield

Endurance test facilities in Plant 1

Key Investments FY 17-18

840T Die Casting Machine in Pricol do Brasil

Key Partnerships

• Exclusive licensing agreement signed with Kerdea Technologies for Oxygen (O2 ) Sensor on July 2017. To expand our sensor portfolio in line with the upcoming Bharat Standard BS-VI Emission Regulations by 2020.
• Post the rollout of BS-VI norms, Pricol is expecting to add significant revenue to its top line with products developed with Kerdea's technology
• Program Status
  • Samples: T0 & T1 samples and reliability tests completed for Horizontal Design Heated Type Sensors. T0 sample under progress for Vertical Design Heated & Unheated Type Sensors
  • Key customers: Keihin, Dell'Orto and Continental
  • Manufacturing Readiness: Manufacturing line (100,000 units/annum for Horizontal Design) ready for internal PPAP. Automated line (3 to 5 million units/annum) proposal is being worked out and build decision will be taken in Oct 2018

Licensing Agreement for Oxygen Sensors

• Exclusive agreement signed with Wenzhou Huirun Electrical Machinery Co., Ltd (ACHR) on Oct 2017 for technical collaboration, supply and production of Fuel Pump and Fuel Pump Modules in India in line with the upcoming Bharat Standard BS-VI Emission Regulations by 2020.
• Program Status
  • Hero MotoCorp & Magnetti Marelli: Final samples submitted in June 2018 and mass production expected from Dec 2018
  • TVS: Samples submitted in June 2018 and under testing
  • Continental: Sample submitted in May and July 2018 and under testing
  • Volvo Eicher: Proto sample submitted in August 2018
  • Lombardini: Proto sample submitted in June 2018
  • Development of BLDC motors under progress and samples received in July 2018 and under testing at Pricol

Technical Collaboration for Fuel Pump Modules

Partnership for Electric Water Pumps

• Exclusive partnership agreement signed with Dongguan Shenpeng Electronics Co Ltd on Jan 2018 to introduce electric water pumps in Indian market across all vehicle segments
• Program Status
  • Products under development for customers like Ashok Leyland, Volvo Eicher, Force Motors, Tata, Bajaj and TVS
  • Performance verification equipment like Functional Generator, CAN Module, Flow and Pressure Sensor are setup
  • In-house testing facilities are setup for endurance and environment related tests

Slide 46

Corporate Social Responsibility

Health	INR 5 lakhs donated to Sankara Eye HospitalEye Camps for 6480 Government school students and 210public members and medical camp for 223 public members
Environment	5000 tree plantation driveDonations to wildlife SOS and Siruthuli
Education	Smart classrooms, renovation and maintenance ofgovernment schools in Valavadi and Perumal Kovilpathy
Infrastructure	INR 2 lakhs contributed to Swachh Bharat, a national initiativeMaternity Ward at Primary Health Centre Valavadi

Corporate Social Responsibility

Slide 48