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MRF LimiteD Reason for Financial Year Oct- Sept Religious and sentimental factors influence the choice

of fiscal year. Thus the hindu festivalof Diwali which marks the beginning of the new year for many indian business industries ,hence MRF follows fiscal year from October to September.

Company Background: Mention the sectors that the company operates in, main products/brand names, market share, geographies of operations, new developments, main competitors etc. Sectors in Which the company operates: The core business of MRF is manufacturing, distribution and sale of tyres for various kinds of vehicles. Tyre Industry: The turnover of the Indian tyre industry is valued at Rs 41,000 crore in the period 2011-2012. Exports accounted for 4,200 crore. 1254 lakh tyres were produced by the tyre companies. Seven top companies produce 80% of the total production. Truck and bus tyres constitute 55% of the tyre industry turnover. Around 57% of the turnover is sold in the replacement market which is competitive but margins are better. The OE segment (30% of the turnover) cannot beignored as volumes are high but margins are less as prices are dependent more on the manufacturers of vehicles. In the passenger car group, 47 % of tyres are sold to OEMs and 49% in the replacement segment. The tyre industry is raw material intensive and predominantly cross-ply or bias-ply tyres are manufactured. The truck, bus and LCV segments continue to be cross-ply based due to poor road conditions, low OE fitment and high initial cost. Passenger tyres are currently 98% radial tyres. Radialisation in the light commercial vehicle group is 22% and in heavy vehicles (truck and bus) the level is 17%. Radialisation in commercial vehicles is expected to grow by 3% to 4% during 2012-13. During 2011-12, in the vehicle manufacturing sector, there has been a decrease of 3% in the production of heavy commercial vehicles and a 30% increase in light commercial vehicles. There was an 8% increase in the small commercial vehicle segment. In the passenger car group, production has remained flat whereas in the utility group, there has been an increase of 39% over the last year. In two wheelers, scooters witnessed a 25% increase whilst in the motorcycle segment production increased by 5%. In the farm segment there was a 2% increase in production over 2010-11. The tyre industry provides direct and indirect employment to one million people including dealers, retreaders and truck operators. The truck operations are controlled by 2.6 million small operators.There are around 5000 tyre dealers spread throughout the country. Mostof them sell multiple tyre brands.

Main Products: Product line: 4 Major categories of Products: 1)Tyres: Passenger Cars Two Wheeler OTR Trucks/ Buses Farm Services LCV Tubes and Flaps SCV 2) Convener Belts 3) Prethreads 4) Paints & Coats

Market Share:

Market Share( Sales)


MRF JK Tyre & Ind Apollo Tyres TVS Srichakra 1% 4% 3% 15% Balkrishna Ind Others Ceat Elgi Rubber

32%

13%

9%

23%

Geographies of Location: Plant Locations: 1. Tiruvottiyur Tiruvottiyur, Chennai,Tamilnadu 2. Kottayam Vadavathoor, Kottayam, Kerala 3. Goa Usgao, Ponda, Goa 4. Arkonam Icchiputhur, Arkonam,Tamilnadu 5. Medak Sadasivapet, Medak,Andhra Pradesh 6. Puducherry Eripakkam Village,Nettapakkam Commune,Puducherry 7. Ankanpally Sadasivapet, Medak,Andhra Pradesh 8. Perambalur Naranamangalam Village & Post,KunnamTaluk,Perambalur District, (Near Trichy),Tamilnadu.

Product Customer Base: Along with catering all regions in India,MRF exports tyres and conveyor belts to over 65 countries in America, Europe, Middle East, Japan and the Pacific region. These markets are serviced by their offices in Dubai, Vietnam and Australia.

New Developments: 2 New products were introduced by the company in the Year 2011-12: SUV Radial MRF Wanderer-Sport is an asymmetric tread pattern SUV tyre for thr new generation of soft-roaders with the emphasis on comfort. The tyre is original eguipment on the best- selling Renault Duster Truck Radial MRF S3P4 is a premium mileage radial for drive axle fitment. It has aunque design that offers normal load operations on highways and improved skid dept enhances mileage. New Developments due to R& D: Continuous development and introduction of new productsfor various applications such as: a) Domestic market b) Export market c) Original Equipment Manufacturers d) Defence sector e) Farm service f) Off the Road g) High performance bias and radial tyres h) Aircraft tyres

i) Specialized tyres for Rallies and Races j) Retread market k) Belting industry l) Inner tubes Main Competitors: Name MRF Apollo Tyres BalkrishnaInd Ceat JK Tyre &Ind TVS Srichakra PTL Enterprises Elgi Rubber Net Profit(In Crores) 572.35 312.53 355.84 106.35 105.54 35.68 16.88 18.87

Among its competitors, MRF has the highest profit, also with respect to Sales, it occupies 32% of the market. Which business segment and/or geographical segment - generates most revenues, is the most profitable, employs the most capital & tangible assets. Business Segment Most Profitable: Details of sales under broad heads: Class of Goods : Automobile Tyres 11486.88 Cr Automobile Tubes 1047.73 Cr Finished tyres give the highest amount of sales and hence the remains the focus of the company. Company Management: Board Size & Composition is the board diverse enough with reference to Gender, Age, Educational Background, Experience, independence etc. As at 30th September, 2012 the Board comprises of 14 Directors. It includes a Chairman & Managing Director, a ManagingDirector, 2 Whole-time Directors, 2 Non-Executive Directorsand 8 NonExecutive Independent Directors. None ofthe Directors on the Board is a member of more than 10 Committees or act as Chairman of more than 5 committees across all Companies in which he is a director.

Has the company expanded board size?.The company expanded its board size from 12 to 14 in the financial year 2011- 2012. Mr Jacob Kurian and Mr M Meyyappan were appointed as Additional Directors ofthe Company on 25/07/2012. How many Board meetings were held during the year?

During the year 2011-12, five Board Meetings were held on 20-10-2011, 29-11-2011, 09-02-2012, 26-04-2012 and25-07-2012. The interval between any two successive Meetings did not exceed four calendar month. Members of Board :

Designation Chairman & Managing Director Managing Director Whole-time Director Whole-time Director Director Director Director Director Director Director Director Director Company Secretary Additional Director Additional Director

Name K M Mammen ArunMammen K M Philip Rahul MammenMappillai K C Mammen Ashok Jacob V Sridhar Vijay R Kirloskar N Kumar Ranjit I Jesudasen S SVaidya Salim Joseph Thomas Ravi Mannath Jacob Kurian M Meyappan

Remunerations 574,90,618.00

Primary Company MRF Ltd

Age 64 47 64

516,47,392.00 MRF Ltd 558,08,758.00 164,25,842.00 MRF Ltd MRF Ltd

50,000.00 MRF Ltd Ellerston Capital Pty 20,000.00 Limited 1,05,000.00 MRF Ltd Kirloskar Electric Company 30,000.00 Limited 50,000.00 ITNation India Pvt. Limited 95,000.00 MRF Ltd 95,000.00 MRF Ltd 50,000.00 MRF Ltd

52 58

63 58

MRF Ltd 10,000.00 MRF Ltd MRF Ltd

The Board of Directors comprises of a healthy mix of Directors with age starting from 47 up till age of 64 which gives a mix of ideologies to the Board.

Shareholders Issued Share Capital: No of shares & par value. SHARE CAPITAL as at 30.09.2011 Authorised 90,00,000 Equity Shares of Rs 10 each = Rs. 9.00 Cr 1,00,000 Taxable, Redeemable Cumulative Preference Shares of Rs 100 each=Rs 1.00 Cr Total Authorized= Rs 10 Cr Issued :

42,41,214 Equity shares of Rs 10 each = Rs 4.24 Cr (Includes 71 bonus shares not issued and not allotted on non-payment of call monies) Subscribed and Fully Paid-up 42,41,143 Equity Shares of Rs 10 each = Rs 4.24Cr

Rights, preferences and restrictions attached to shares: The Company has one class of equity shares having a par value of ` 10 per share. Each shareholder is eligible for one vote per share held. The dividend Proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding. Shareholders holding more than 5 percent of the equity shares: Name of Shareholder(No of Shares) As at 30.09.2011 1)Comprehensive Investment and Finance Company Private Limited=422,069 2) MOWI (P) Limited= 507,984 3) Enam Shares and Securities Private Ltd.= 266,713 Listing on Stock Exchanges at: 1. Madras Stock Exchange Ltd., (MSE) Exchange Building P B No.183, 11 Second Line Beach, Chennai 600 001 2. National Stock Exchange of India Ltd., (NSE) Exchange Plaza, 5th Floor, Plot No.C/1, 5 G Block, Bandra-Kurla Complex, Bandra (E), Mumbai 400 051. 3. Bombay Stock Exchange Ltd., (BSE) PhirozeJeejeebhoy Towers, Dalal Street, Mumbai 400 001. Equity ISIN : INE 883A01011.

What is the highest & lowest price at which the shares traded during the financial year? Highest During the year

LoweSt during the year

What is Book Value of the shares?

How does book value compare with the par value & the current market price?

Do you observe any relation between the Sensex/Nifty & the companys stock prices? A strong relation was seen between the SENSEX & NIFTY and MRF s stock Prices as seen in the chart below:

Comparison with SENSEX

Comparison with NIFTY *Source: Money Control

When was the AGM held? What was the agenda for the meeting? Meeting: 09-02-2012 No Special Resolution was passed.For the present year, a) Annual General Meeting: Date and Time : 07-02-2013, 11.00 A.M. Venue : TTK Auditorium The Music Academy No. 168 TTK Road,Chennai 600014

Auditors: Who are the auditors? Have they changed from the last year? Auditors Messrs Sastri & Shah and M.M. Nissim and Co., who are our Auditors,retire at the ensuing Annual General Meeting and are eligible for re-appointment. The auditors were the same the previous fianacial years too. The Company has received certificates from both the auditors to the effect that their appointments will be within the limits prescribed under Section 224[1B] of the Companies Act, 1956. Are there any negative comments in the audit report? Does the audit report contain any recommendation to present/potential investors? The audit report only contains the validation of the Balance Sheet, Profit & Loss statement and Cash Flow Statement. What is the total compensation to the auditors? Did the auditors provide any nonaudit services also? Auditors Remuneration: As Auditors: Audit fee (Including Rs 0.06 crore for previous year) Rs0.30 Cr Tax Audit fee Rs 0.05 Cr

Fixed Assets:

Nature of Fixed Assets

Cost as

Additions Deductions/Adjustments Cost as

Tangible Land Buildings Plant & Machinery Moulds Furniture & Fixtures Computer Office Equipment Other Assets Vehicles Total Tangible Assets Previous year Intangible Assets Computer Software Total Intangible Assets Previous Year

at 0110-2011 Assets 96.04 511.26 2753.74 292.44 14.97 30.65 22.69 76.72 18.37 3816.88 3354.58 14.94 14.94 13.32 0.02 295.74 867.11 40.14 1.5 2.98 2.29 25.15 4.33 1239.26 486.89 4.53 4.53 1.62 -

on 3009-2012

3.36 4.74 0.47 0.41 0.49 1.76 1.87 13.1 24.59

96.06 807 3617.49 327.84 16 33.22 24.49 100.11 20.83 5043.04 3816.88 19.47 19.47 14.94

DEPRECIATION: Depreciation Provided during the Nature of Fixed Assets Upto 30-09-2011 year Tangible Assets Land 1.36 0.09 Buildings 88.75 19.49 Plant & Machinery 1455.62 235.74 Moulds 208.36 25.32 Furniture & Fixtures 10.84 1.7 Computer 22.59 3.81 Office Equipment 16.27 2.26 Other Assets 34.03 7.61 Vehicles 11.49 2.74 Total Tangible Assets 1849.31 298.76 Previous year 2030.78 244.71 Intangible Assets Computer Software 11.13 2.35 Total Intangible Assets 11.13 2.35 Previous Year 8.21 2.92 Capital Work-in-Progress Grand total Note: Land includes Agriculture Land - ` 0.12 crore and Leasehold Land ` 4.33 crore. Deductions/ Adjustments 3.35 4.73 0.39 0.41 0.48 1.69 1.79 12.84 426.18 -

NET ASSETS( TOTAL ASSETS- DEPRECIATION): Net Block As at 30-09-2011 94.68 422.51 1298.12 84.08 4.12 8.06 6.41 42.71 6.88 1967.57

Nature of Fixed Assets Tangible Assets Land Buildings Plant & Machinery Moulds Furniture & Fixtures Computer Office Equipment Other Assets Vehicles Total Tangible Assets Previous year Intangible Assets Computer Software Total Intangible Assets Previous Year Capital Work-in-Progress Grand total

As at 30-09-2012

94.61 698.76 1929.48 98.89 3.85 7.23 6.44 60.16 8.39 2907.81 1967.57 5.99 5.99 3.81 414.65 3328.45

3.81 3.81 5.11 1042.25 3013.63

What is composition of tangible & intangible assets: Tangible assets: Rs 2907.81 Cr Intangible assets: Rs 5.99 Cr What is the policy for depreciation? Is it the same for all types of assets? Depreciation: (i) Depreciation on Buildings, Plant and Machinery,Moulds and a part of Other Assets has been provided on straight line method at the rates and on the basis as specified in Schedule XIV to the Companies Act, 1956,and in respect of vehicles and a part of Other Assets where, based on managements estimate of the useful life of the assets, higher depreciation has been provided on straight line method at the rate of 20%. (ii) Assets acquired/purchased costing less than Rupees Five Thousand have been depreciated at the rate of 100%. (iii) Depreciation on Renewable Energy Saving Devices,viz., Windmills, is being charged on Reducing Balancing Method, as Continuous Process Plant at the rates and on the basis as specified in Schedule XIV to the Companies Act, 1956 (iv) Leasehold Land is amortised over the period of the lease.

(v) Intangible Assets are amortised over 5 years commencing from the year in which the expenditure is incurred. What is the depreciation as % of total revenues? DEPRECIATION & AMORTISATION EXPENSE Depreciation on tangible assets 298.76 Amortisation on intangible assets 2.35 Total 301.11

What the return on total assets, return on fixed assets? Return on Assets: 0.196869809 Return on Fixed Assets: 0.171989965

What Kind of Inventory does the company hold, the total investment and has it changed from the previous year? The cost is computed on FIFO basis except for stores and spares which are on Weighted Average Cost basis. MRF generally maintains three types of Inventories Viz. Automobile tyres, Tubes and T&S equipment. Its finished good inventory has increased from 453.21 to 474.71 but it has decreased in work in progress from 145.81 to 137.92 crores which implies that MRF has more inventories of finished goods and less on unfinished goods. Automobiles tubes finished inventory has increase from 53.47 to 67.74 crores and its stock in progress in almost unchanged. What are the sources of long term debt? Has the composition changed? MRF has raised their long term funds through two equipment viz. External Commercial borrowings and issue of debentures. Are the borrowings in different currencies? MRF has borrowed a considerable amount of Rs. 204.62 Cr through External Commercial which is an instrument used by Indian Corporations to raise funds from abroad. MRF has raised money through ECBs in 3 major currencies viz. USD and Japanese Yen. The Company has entered into Forward Exchange Contracts, Currency Swaps and Interest Rate Swaps being derivative instruments, which are not intended for trading or speculative purposes, but for hedging purposes, to establish the amount of reporting currency required or available at the date ofsettlement of certain payables and receivables.

Which assets are offered as security against the borrowings? MRF has raised funds from abroad through Debenture equipment which doesnt require any collateral and hence they havent pledged any mortgage there. ECB from The Bank of Tokyo - Mitsubishi UFJ, Ltd. is secured by a first charge on plant and machinery situated at its Puducherry Unit. Interestis payable at a rate equal to the 6 month BTMU LIBOR plus margin of 1.55% payable half-yearly. The said loan is fully hedged and is repayablein 3 equal annual instalments at the end of the 4th, 5th and 6th year beginning October 2015. ii) ECB from Credit Agricole is secured by a first charge on specific items of plant and machinery situated at its Units at Kottayam, Goa and Arkonam.Interest is payable at a rate equal to the 6 month LIBOR for JPY plus a margin of 0.58% payable half-yearly. The said loan is fully hedged and isrepayable in 2 instalments in February and August 2013. iii) The principal amount of debentures, interest, remuneration to Debenture Trustees and allother costs, charges and expenses payable by the Companyin respect of debentures are secured by way of a legal mortgage of Companys land at Gujarat and hypothecation of plant and machinery at theCompanys plants at Ankenpally, Andhra Pradesh and at Perambalur, near Trichy, Tamil Nadu, equivalent to the outstanding amount.

What % of total assets in funded by long term debt? MRF has financed its asset basically from its Shareholders funds and long term funds form only 15.2% as the amount invested from the total assets. What is the interest coverage ratio? MRF Ltd has an interest Coverage ratio of 5.6265 which is better than the Industry Ratio. Are operating cash flows sufficient to meet interest & principal obligations? MRF has a Cash of Rs. 1033840000 generated from Operating activities and it is enough to meet the Interest Obligation and it is also enough to meet the Debenture Obligations. What kind of investments has the company made? How much is trading purposes? MRF ltd. has made a non-current investment of 74.37 crores of which 71.54 is Unquoted and 2.83 crore of unquoted Investment. It has also made a current investment of 353.17 Crores which is mainly into Mutual Funds which is to diversify its portfolio. MRF Ltd derived an income of 1.33 crores from its investments in the form of Interest Income and Dividends. MRF Ltd has maintained a pool of 64.64 crores of Contingent Liability which pertains to Warranty of tyres which consists of 34.12 crores and litigation and related disputes has 30.42 crores allotted to it. Its contingent Liability is 6.33% of its Profit from operating activities.

MRF has an Exceptional Income arising from the fact that they switched from written down Method of depreciation to Straight-line Method of Depreciation in 2011 which amounts to Rs 404.23 Crores. MRF effectively paid a Tax of 31.29% which amounts to Rs.260.76 Crores. Particulars Sales Other Income Total Income PBT Provision for Taxation Profit after Taxation Share Capital Reserves Net Worth Fixed Asset Gross 2012 13054.03 39.73 13093.76 833.12 260.76 572.36 4.24 2853.56 2857.80 5477.16 2011 10637.03 33.14 10670.17 893.65 274.23 619.42 4.24 2293.53 2297.77 4874.07

Even after posting a Sales growth of 18.51% MRF has not been able to convert his acumen into profit and this is evident from their declined PAT figure which stands at 572.36 crores, 47.06 crores lesser that last year. This is pertaining to their increased administrative expenses, selling and distribution expenses. MRF has posted a very healthy cash generation from its operating activities. Their cash flows from operating activities stand at 1022.77 which are 389.08 crores more than previous year.

The Spread between the Cash flow from operating activities and cash flow is tremendous this year and this is because they negative and almost zero cash flow from Investing and Financing activities respectively. They have a handsome cash flow of 1022.77 crores from Operating activities which portends good for its core business which also implies the core business is functioning very well. They have purchased a machine for 616.19 crores and incurred a loss of 352.01 crores in their Investing activities and similar is the story with financing activities which has drawn the net income from Investing into negative figure and which has also brought down the net cash flow down to 5.08 crores.

Ratio Analysis: MRF has a very good current as well as quick liquidity in comparison with both their closest competitor- Apollo and Industry on the whole. When the competitor and the Industry on the whole are suffering to maintain enough current assets to pay their current liabilities, MRF Ltd is sitting in a much better position which is almost a point above the Industry standard. Solvency Ratio:The persons who have advanced money to the business on long-term basis areinterested in safety of their payment of interest periodically as well as therepayment of principal

amount at the end of the loan period. Solvency ratios arecalculated to determine the ability of the business to service its debt in the long run. MRF Ltds solvency ratio which shows their debt-equity, Debt Ratio, Proprietary Ratio, Total Asset to Debt Ratio and Interest Coverage Ratio are projecting healthy projections which compares good with the Industry too. Apollo is one notch above MRF when it comes to total Asset to Debt Ratio. The turnover ratios basically exhibit the activity levels characterised by thecapacity of the business to make more sales or turnover. The activity ratiosexpress the number of times assets employed, or, for that matter, any constituentof assets, is turned into sales during an accounting period. Higher turnoverratio means better utilisation of assets and signifies improved efficiency andprofitability, and as such is known as efficiency ratios. The Stock turnover ratio which means how many turns of inventory has been utilised in the manufacturing process during the year. Higher the Inventory/stock turnover ratio; the better the condition but as a precaution the inventory lot shouldnt be very too small because it will lead to higher inventory turnover ratio without benefitting the business in turn. MRF Ltd doesnt feature well when it comes to Debtors turnover ratio which is staggering high at the Industry level but MRF and Apollo both are not performing up to that mark. It doesnt bode for the company as their recuperating of money from credit Sales is not as efficient as the Industrys is. Creditors turnover ratio is also in doldrums with MRF whereas Apollo has a creditors turnover ratio in tandem with the Industry. Here MRF has to maintain a good relationship with its Creditors because it doesnt have sound turnover ratio. If MRF has to go for raising further money from the market it might face some problems if it doesnt maintain good relationship with creditors. But a worrying trend is that the Creditors turnover ratio has decreased this year. Fixed turnover ratio too has decreased this year which is not good for the business. As Asset turnover ratio means the utilisation of the assets in producing Sales and generating Revenues for the business and hence its declining means that MRF is not able to maintain the same utilisation of its assets as it has been doing the last year and in the past. MRF is leading the Industry in its segment when it comes to the Asset turnover ratio as the Industry Ratio is half of what MRF has shown. Working Capital turnover ratio which means the amount the sales generated from the Working Capital (CA-CL) has shown a good growth for MRF over the past year and it fares much better than its closest competitor Apollo and Industry too.

MRF
Liquidity Ratio Current Assets: Current Liabilities: Current Ratio Quick Ratio 2012 3160.78 2069.72 1.527153431 0.73207487 2011 3079.41 2109.46 1.45980962 0.736392252

Solvency Ratio Long Term Debt 2012 1102.71 2011 961.49

Shareholder's Fund Debt-Equity Ratio Debt Ratio: Long term Debt/Capital Employed Proprietary Ratio: Shareholder's fund/Capital Employed Total Asset to Debt Ratio: Total Assets/ Long term Debt Interest Coverage Ratio: PBIT/Interest on long term Debt

2857.80 0.38586 0.278426 0.721574 6.540496 5.626528

2297.77 0.418445 0.295003 0.704997 6.589668 8.393415

Turnover Ratio 1. Stock Turn-over: COGS/Avg Inventory 2. Debtors (Receivable) Turnover; 3. Creditors (Payable) Turnover; 4. Fixed Assets Turnover; 5. Working Capital Turnover. Working Capital: CA-CL 2012 12.125 1.053 0.961 4.511 12.069 2011 11.786 1.237 1.123 5.400 10.984

1091.06 969.95

Profitability Ratio 1. Gross Profit Ratio: Gross Profit/Net Sales*100 2. Operating Ratio: (COGS+ Operating Expenses)/Net Sales*100 3. Operating Profit Ratio: Operating Profit/Sales *100 4. Net profit Ratio: Net Profit (PAT)/Net Sales 5. Return on Investment (ROI) or Return on Capital Employed (ROCE): PBIT/Capital Employed *100 6. Return on Net Worth (RONW): PAT/Sharholder's Fund 7. Earnings per Share: Profit Available to Equity Shares/ No. of Equity Shares 8. Book Value per Share: Equity Shareholder's fund/No. of Equity Shares 9. Dividend Payout Ratio: Dividend per share/ EPS 2012 2011 0.361190115 0.306744262 0.938470336 0.982046276 0.232867817 0.182479936 0.044003138 0.05808232 0.212914498 0.274022324 0.202743369 0.269295883 1349.31 1458.969905

0.000673828 0.000541781 0.018299735 0.017135376 <= MP September 6.984379391 2012 on 19,

10. Price Earning Ratio: Market price of Share/EPS

9.49170656

Apollo Tyres
Liquidity Ratio Current Assets Current Liabilities Current Ratio Quick Ratio

17,351.90 17931.65 0.967668898 0.342614316

18,364.97 21543.49 0.852460302 0.338253923

Solvency Ratio Long Term Debt Shareholder's Fund Debt-Equity Ratio Debt Ratio: Long term Debt/Capital Employed Proprietary Ratio: Shareholder's fund/Capital Employed Total Asset to Debt Ratio: Total Assets/ Long term Debt Interest Coverage Ratio: PBIT/Interest on long term Debt

13383.68 23306.48 0.574247 0.364776 0.635224 4.361436 1.848341

12619.88 20476.04 0.616324 0.381312 0.618688 4.56886 1.111872

Turnover Ratio 1. Debtors (Receivable) Turnover; 2. Creditors (Payable) Turnover; 3. Fixed Assets Turnover; 4. Working Capital Turnover. Working Capital: CA-CL Net Sales 0.858 0.839 2.770 -146.744 -579.75 85704.91 1.237 1.123 2.862 -25.666 -3,178.52 81578.75

Profitability Ratio 1. Gross Profit Ratio: Gross Profit/Net Sales*100 2. Operating Ratio: (COGS+ Operating Expenses)/Net Sales*100 3. Operating Profit Ratio: Operating Profit/Sales *100 4. Net profit Ratio: Net Profit (PAT)/Net Sales 5. Return on Investment (ROI) or Return on Capital Employed (ROCE): PBIT/Capital Employed *100 6. Return on Net Worth (RONW): PAT/Sharholder's Fund 7. Earnings per Share: Profit Available to Equity Shares/ No. of Equity Shares 8. Book Value per Share: Equity Shareholder's fund/No. of Equity Shares 9. Dividend Payout Ratio: Dividend per share/ EPS 10. Price Earning Ratio: Market price of Share/EPS

0.285978948 0.144184038 0.055366606 0.036465589 0.022983001 0.134094895 6.200647639 46.24074329 0.080636738 10.73274985

0.306744262 0.128247001 0.031566186 0.02222797 0.07780808 0.088558628 3.597700169 40.6250669 0.138977674 27.29521511

Industry

Liquidity Ratio Current Ratio Quick Ratio 2012 0.91 0.67 2011 0.94 0.64

Solvency Ratio 2012 Long Term Debt Shareholder's Fund Debt-Equity Ratio Debt Ratio: Long term Debt/Capital Employed Proprietary Ratio: Shareholder's fund/Capital Employed Total Asset to Debt Ratio: Total Assets/ Long term Debt Interest Coverage Ratio: PBIT/Interest on long term Debt 2011

0.57 0.66 0.2209 0.1521 0.2202 0.2695 2.65 6.25 2.56 6.24

Turnover Ratio 1. Stock Turn-over: COGS/Avg Inventory 2. Debtors (Receivable) Turnover; 3. Creditors (Payable) Turnover; 4. Fixed Assets Turnover; 5. Working Capital Turnover. 2012 7.950 8.580 2.350 2.350 N/A 2011 7.350 9.170 2.550 2.550 N/A

Profitability Ratio 1. Gross Profit Ratio: Gross Profit/Net Sales*100 2012 0.0809 2011 0.0582

2. Operating Ratio: (COGS+ Operating Expenses)/Net Sales*100 3. Operating Profit Ratio: Operating Profit/Sales *100 4. Net profit Ratio: Net Profit (PAT)/Net Sales 5. Return on Investment (ROI) or Return on Capital Employed (ROCE): PBIT/Capital Employed *100 6. Return on Net Worth (RONW): PAT/Sharholder's Fund 7. Earnings per Share: Profit Available to Equity Shares/ No. of Equity Shares 8. Book Value per Share: Equity Shareholder's fund/No. of Equity Shares 9. Dividend Payout Ratio: Dividend per share/ EPS 10. Price Earning Ratio: Market price of Share/EPS

N/A 0.1064 0.0481 0.0794 0.2002 1349.54 6738.28 0.0215 9.785

N/A 0.0837 0.0636 0.0735 0.2695 1460.5 5417.81 0.0199 9.420

Profit before Tax Trend Years Profit Before Tax 2003 167.75 2004 42.9 2005 55.34 2006 99.81 2007 260.96 2008 211.39 2009 398.48 2010 534.66 2011 893.65 2012 833.12

Profit Before Tax Trend


1000 900 800 700 600 500 400 300 200 100 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Reserves Trend Years Reserves 2003 699.96 2004 719.17 2005 749.81 2006 820.05 2007 981.91 2008 1116.55 2009 1357.18 2010 1686.44 2011 2293.53 2012 2853.56

Reserves Trend Reserves


3000 2000 1000 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

10 YEAR TREND ANALYSIS


Ten year Financial Summary RsCrore Sales Other Income Total Income Profit before Taxation Provision for Taxation Profit after Taxation Share Capital Reserves Net Worth Fixed Assets Gross 2003 2542 65.71 2608 167.8 50.37 117.4 4.24 700 704.2 1349 2004 2989.4 58.54 3048 42.9 14 28.9 4.24 719.17 723.41 1534.5 2005 3437 44.96 3482 55.34 15.03 40.31 4.24 749.8 754 1788 2006 2007 2008 2009 2010 2011 2012

4234 5037 5716 6142 8080 10637 13054 27.07 24.2 40.83 34.4 29.13 33.14 39.73 4261 5061 5756 6176 8110 10670 13093.8 99.81 261 211.4 398.5 534.7 893.65 833.12 19.9 89.2 66.83 145.5 180.7 274.23 260.76 79.91 172 144.6 253 354 619.42 572.36 4.24 4.24 4.24 4.24 4.24 4.24 4.24 820.1 982 1117 1357 1686 2293.5 2853.56 824.3 986 1121 1361 1691 2297.8 2857.8 1956 2290 2866 3021 3866 4874.1 5477.16

*893.65

* Includes an exceptional item of ` 404.23 crore which represents reversal of excess depreciation of earlier years, due to change in method of depreciation from Written Down Value (WDV) to Straight Line Method(SLM). Relatively high profit In 2011 due to change in Depreciation method from WDM to SLM
700 600 500 400 300 200 100 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Sales

14000 12000 10000

SALES

8000 6000 4000 2000 0

YEAR
DuPontAnalysis: Assets ROE: Profit Margin Turnover Leverage 2011 0.149098474 0.032207675 1.678850676 2.757412622 2012 0.200279936 0.043845464 1.809975223 2.523714046

Interest Profit Margin Tax Burden Burden Sales Margin 2011 0.032207675 0.383364852 1.122704088 0.074831038 2012 0.043845464 0.687007874 1.235459857 0.051657611

PROFIT

*For Calculation of Profit Margin, Profit after Tax before Exceptional Item has been considered. The ROE, Profit Margin have shown a increase, while decreasing Leverage. Tyre Industry is Raw Material (RM) intensive. RMs account for 72% of Industry Turnover. Natural Rubber is the key raw material of the tyre industry with a cost of 45% of all raw materials.