Attachment 1
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Report
Update On |
8th October, 1999 |
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Report on |
APOLLO TYRES LIMITED |
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Registered Office |
6th Floor, Cherypushram Building, Shanmugam Road, Kochi –
682 031, Kerala, INDIA |
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Tel. No. |
91-484-381 902 / 381 903 / 381 895 / 381 808 / 381 895 |
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Fax No. |
91-484-370 351 |
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E-Mail |
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Website |
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Telex |
-- |
Attachment 2
S U M M A R Y
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Incorporated |
1972 |
Status |
Good |
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Registration No. |
2449 |
Chief Executive |
Mr. Raunaq Singh |
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Capital (Rs.) |
330.6 millions |
Payments |
Reguar |
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Sales (Rs.) |
11,540.2 millions |
Litigation |
-- |
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Net Worth (Rs.) |
3,150.0 millions |
Banking Reputation |
Satisfactory |
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No. of Employees |
6,200 |
Auditors |
Fraser & Ross |
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Credit Rating |
A (See attachment 3) |
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INDUSTRY
The Indian tyre industry is going through an important phase of restructuring marked with mergers, acquisitions and entry of MNCs. The industry having enjoyed a high growth rate of about 11-12% in mid eighties and early nineties is now in the midst of a slump. The economic recession since Q4FY97 particularly in the automobile and the transport sectors, to which the industry’s fortunes are closely linked, has taken a toll on the tyre industry. Though production continues to grow at a rate of about 7-9% average, the industry is faced with depressed demand both from domestic and international markets.
The Indian tyre industry has an installed capacity of 37 mn (numbers). Total tyre production is estimated at 34 mn implying a capacity utilization of about 92 percent. Average annual growth in production during the last decade (1987-88 to 1997-98) has been 19 percent. The Rs.95,000 mn tyre industry is characterised by over capacity.
Exports have registered a decline of about 8.7%. The production of trucks and tyres, the backbone of the industry, has reportedly slid by about 8% during April to October 1998, as compared to the corresponding period last year. Most players are saddled with huge inventories. Certain sub-segments of the industry have however done well in the first six months of FY99. The two and three wheeler segments for instance have increased their production. The company benefit includes Srichakra, Falcon and Balkrishna.
Recently, many foreign companies have shown interest in entering the Indian tyre industry. Until now, Indian companies have been able to cater to domestic demand & have managed to maintain their market shares. But the entry of MNCs, with greater technical and financial clout, may lead to a shakeout in the Indian tyre industry.
On the whole, till the industry and the movement of goods picks up, Indian tyre companies will have to weather low sales and shrinking margins.
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WORKS
K Perambra,, P.O. Chalakudy, Trichur – 680 669, Kerala, India
K Limda, Taluka Waghodia, Dist. Vadodara – 391 760, Gujarat, India
K Ranjan Gaon, Nagar Road, Tal. Shirur, Dist. Pune – 419 209, Maharashta, India
BRANCH
4th Floor, 60 Skylark Building, Nehru Place, New Delhi – 110 019, INDIA
Tel. No. 91-11-643 1005
Fax No. 91-11-647 1283
HISTORY
The company was incorporated on 28th September, 1972 at Kochi in Kerala having Company Registration Number 2449.
The company commenced its commercial production in 1977.
LEGAL FORM
It is a Public Limited Liability company. The company’s shares are listed on the Stock Exchange.
DIRECTORS
|
Mr. Raunaq Singh |
Chairman & Managing Director |
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Mr. Onkar S. Kanwar |
Vice Chairman & Managing Director |
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Mr. U. S. Oberoi |
Chief (Proj. & Corp. Affairs) & Whole-time
Director |
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Mr. K. Jacob Thomas |
Director |
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Mr. M. R. B. Punja |
Director |
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Mr. Nimesh N. Kampani |
Director |
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Mr. O. P. Gupta |
Director |
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Mr. R. V. Subrahmanian |
Director |
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Mr. Shardul S. Shroff |
Director |
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Mr. A. P. Kurian |
UTI Nominee Director |
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Mr. K. Mohan Das |
Kerala Government Nominee Director |
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Mr. M. Y. Ranade |
SBI Nominee Director |
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Mr. Vinod Rai |
Kerala Government Nominee Director |
PARTICULARS OF CHIEF EXECUTIVE
|
Name |
Mr. Onkar S. Kanwar |
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Designation |
Vice Chairman & Managing Director |
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Age |
56 years |
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Qualification |
B.Sc., Bachelor of Administration (California) |
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Experience |
36 years |
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Date of Joining |
1st February, 1988 |
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Previous Employment |
BST Manufacturing Limited |
BUSINESS
The company is engaged in manufacturing of Automobile Tyres, Automobile Tubes, Automobile Flaps and Camel Black/Retreading Materials.
The company’s production status as on 31st March, 1999 was as under :
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PARTICULARS |
Unit |
Installed Capacity |
Actual Production |
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Automobile Tyres |
Nos. |
2,441,846 |
2,330,658 |
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Automobile Tubes |
Nos. |
2,985,900 |
2,169,524 |
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Automobile Flaps |
Nos. |
1,604,750 |
1,333,267 |
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Camel Black/Retreading Materials |
MT |
3,000 |
-- |
Generic Names of Principal Products of the company are :
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Item Code No. (ITC Code) |
40111000 |
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Product Description |
Passenger/Jeep Tyres |
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Item Code No. (ITC Code) |
401112000 |
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Product Description |
Bus/Lorries Tyres |
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Item Code No. (ITC Code) |
40119901 |
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Product Description |
Off the Road Tyres |
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Item Code No. (ITC Code) |
40129004 |
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Product Description |
Bus/Lorries Flaps |
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Item Code No. (ITC Code) |
40131001 |
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Product Description |
Passenger/Jeep Tubes |
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Item Code No. (ITC Code) |
40131002 |
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Product Description |
Bus/Lorries Tubes |
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Item Code No. (ITC Code) |
40139003 |
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Product Description |
Off the Road Tubes |
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Item Code No. (ITC Code) |
40139004 |
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Product Description |
Tractor
Tubes |
OPERATIONS
Sales and other income for the financial year ended 31st March, 1999 aggregated to Rs.11,540.2 millions as against Rs.13,692.4 millions during the previous year. The lower turnover was mainly on account of prolonged lock-out for 100 days from April 10, 1998 to July 18, 1998 at Company’s Perambra Plant on account of labour unrest which affected overall profitability. Due to slow down of economy, Road Transport and Automobile Industry witnessed recessionary conditions, which left its impact on the Tyre Industry.
Despite the lock out, operation profit before depreciation and tax during the period under report amounted to Rs.753.2 millions representing 6.54% of the turnover and was higher than the previous year of 6.15% amounting to Rs.839.6 millions. Profit after tax during the year was Rs.400.2 millions as against Rs.481.1 millions in the previous year. After settling direct and indirect tax disputes of Rs.89.4 millions (Net of Tax) under the Kar Vivad Samadhan Scheme, net profit amounted to Rs.310.8 millions as compared to Rs.406.8 millions in the previous year. However, after writing back debenture redemption reserve no longer required, profit available for appropriation is higher at Rs.688.4 millions as compared to Rs.551.7 millions in the previous year.
The company has been given ISO 9001 Certification.
EXPORTS
The export market of tyres continued its sluggish trend during the year under report also due to factors like currency fluctuations, increased realization and stiff competition from low priced Chinese, South East Asian and Korean bias Truck & Bus Tyres.
Moreover, recessionary trend all over the world had put severe pressure on prices in all the markets. Apollo International Limited, the export arm of the company, had to sacrifice market share in an attempt to hold prices. Apollo International Limited (AIL) exported Tyres aggregating to Rs.1,271 millions as compared to Rs.1,554 millions during the previous year. AIL continue to remain amongst the top three Indian Companies in the African sub-continent with significant presence in Egypt, Tanzania, Kenya, Nigeria, Ghana, etc.
IMPORTS
The company imports its requirements mainly from Germany, Singapore and U.K.
STATUS OF Y2K PREPAREDNESS
The company has assessed the Year 2000 (Y2K) impact for all its internal operations and had set a deadline of September 30, 1999 for achieving compliance. This involved all IT systems – software and hardware, factory/process systems, telecom systems and networking at all the Factories, Regional Offices, District Offices, Re-Distribution Centres and the Headquarters.
In the company’s assessment, there are no intermediaries dependent on our operation. Due to the nature of operations, the company does not foresee any risk to the business from any of its external dependencies.
The estimated cost of remediation efforts would be around Rs.50 millions approximately, which include capital expenditure for replacing hardware.
FIXED ASSETS
The company’s fixed assets of important value includes Land, Leasehold Land, Buildings, Water Supply Installation, Plant & Machinery, Electrical Installation, Furniture & Fixture, Office Equipments and Vehicles.
EMPLOYEES
The company employs 6,200 persons in different set-ups.
ASSOCIATES
K Raunaq Finance Limited
K Apollo Tubes Limited
K Bharat Gears Limited
SUBSIDIARIES
K Apollo International Limited
K Apollo Finance Limited
K Premier Tyres Limited
MEMBERSHIPS
K Confederation of Indian Industry
BANKERS
K State Bank of India
K Bank of India
K Bank of Baroda
K Barclays Bank p.l.c.
K Punjab National Bank
K State Bank of Mysore
K State Bank of Patiala
K State Bank of Travancore
K The ICICI Banking Corporation Limited
K Union Bank of India
K ANZ Grindlays Bank
AUDITORS
K Fraser & Ross
Chartered Accountants
FINANCIAL INFORMATION
The company's latest financial information for the period ended 31st March, 1999 is enclosed herewith.
The company’s Summarised Results for the 3 months period ended 30th June, 1999 were as under :
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Sales |
Rs.3,265.0 millions |
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Operating Profit Margin |
6.6% |
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Net Profit |
Rs.90.0 millions |
CAPITAL STRUCTURE
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Authorised Capital : |
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|
48,000,000 |
Equity Shares of Rs.10/- each |
Rs.480.0 millions |
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200,000 |
Preference Shares of Rs.100/- each |
Rs. 20.0 millions |
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GRAND TOTAL |
Rs.500.0 millions |
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Issued, Subscribed &
Paid-up Capital : |
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33,054,420 |
Equity Shares of Rs.10/- each |
Rs.330.5 millions |
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Add : |
Forfeited Shares |
Rs. 0.1 millions |
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GRAND TOTAL |
Rs.330.6 millions |
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COMMENTS
Subject is a well-established and reputed company having fine track. Available information indicates high financial responsibility of the company. Financial position of the company is good. Payments are usually correct and as per commitments.
The company can be considered good for any normal business dealings at usual trade terms and conditions.
It can be regarded as a promising business partner in a long-run.
ABRIDGED BALANCE SHEET AS ON 31ST March, 1999
[figures are in Rupees Millions]
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SOURCES OF FUNDS |
31.03.1999 |
31.03.1998 |
31.03.1997 |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
330.6 |
300.5 |
298.8 |
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2] Reserves & Surplus |
2,819.4 |
2,424.5 |
2,146.2 |
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LOAN FUNDS |
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1] Secured Loans |
2,572.1 |
2,528.3 |
2,670.8 |
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2] Unsecured Loans |
367.9 |
420.3 |
281.9 |
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GRAND TOTAL
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6,090.0 |
5,673.6 |
5,397.7 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
3,242.7 |
3,040.5 |
3,035.2 |
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Capital work-in-progress |
337.2 |
46.8 |
67.9 |
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INVESTMENTS |
275.9 |
275.6 |
276.2 |
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CURRENT ASSETS, LOANS & ADVANCES |
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Inventories |
1,537.6 |
975.9 |
1,296.5 |
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Sundry Debtors |
1,319.8 |
2,529.4 |
1,318.7 |
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Cash & Bank Balances |
573.7 |
384.3 |
346.0 |
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Other Current Assets |
25.9 |
25.8 |
32.8 |
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Loans & Advances |
442.7 |
485.8 |
638.3 |
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Total Current Assets |
3,899.7 |
4,401.2 |
3,632.3 |
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Less : |
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Current Liabilities & Provisions |
1,858.8 |
2,287.9 |
1,849.6 |
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Net Current Assets |
2,040.9 |
2,113.3 |
1,782.7 |
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MISCELLANEOUS EXPENSES |
193.3 |
197.4 |
235.7 |
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GRAND TOTAL
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6,090.0 |
5,673.6 |
5,397.7 |
IMPORTANT FINANCIAL INFORMATION FOR LAST Three PERIODS
[figures are in Rupees Millions]
|
PARTICULARS |
31.03.1999 |
31.03.1998 |
31.03.1997 |
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Sales Turnover |
11,540.2 |
13,692.4 |
14,269.1 |
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[including other income] |
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Profit/(Loss) Before Tax |
518.6 |
618.7 |
419.3 |
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Provision for Taxation |
118.4 |
137.6 |
56.1 |
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Profit/(Loss) After Tax |
400.2 |
481.1 |
363.2 |
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Dividend |
126.6 |
119.8 |
118.5 |
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Earnings in Foreign Currency : |
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Export Earnings |
0.0 |
0.0 |
0.4 |
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Other Earnings |
0.0 |
0.0 |
0.0 |
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Total Earnings |
0.0 |
0.0 |
0.4 |
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Imports : |
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Raw Materials |
1,236.6 |
1,556.3 |
1,422.8 |
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Components & Spares |
16.3 |
17.9 |
29.4 |
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Capital Goods |
21.4 |
48.8 |
27.6 |
Total Imports
|
1,274.3 |
1,623.0 |
1,479.8 |
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Expenditures :
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Manufacturing & Other Expenses |
8,115.7 |
8,892.8 |
9,277.5 |
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Work in Progress & Finished Goods |
(430.4) |
394.5 |
440.9 |
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Interest |
589.7 |
637.5 |
692.2 |
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Excise Duty |
2,512.0 |
2,928.0 |
3,239.9 |
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Depreciation |
234.6 |
220.9 |
199.3 |
Total Expenditures
|
11,021.6 |
13,073.7 |
13,849.8 |
Attachment 3
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SCORE SHEET |
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SCORE |
CREDIT RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the
strongest capability for timely payment of interest and principal sums |
Unlimited |
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71-85 |
Aa |
Possesses adequate working capital. No caution
needed for credit transaction. It has above average (strong) capability for
payment of interest and principal sums |
Large |
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56-70 |
A |
Financial & operational base are regarded
healthy. General unfavourable factors will not cause fatal effect.
Satisfactory capability for payment of interest and principal sums |
Fairly
Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to
meet normal commitments. Maybe drawn to slightly difficult position as
unfavourable conditions arise. Minimal assurance for timely payment on
interest and principal sums |
Moderate |
|
26-40 |
B |
Unfavourable & favourable factors carry similar
weight in credit consideration. Capability to overcome financial difficulties
seems comparatively limited or considered not known. Capability to pay both
interest and principal sums is doubtful |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest
and principal sums in default or expected to be in default upon maturity |
Limited
with full security |
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<10 |
C |
Absolute credit risk exists. Caution needed to be
exercised |
Credit
not recommended |
Attachment 4
INDIA
INDIA, a Union of States, is a Sovereign Socialist Secular Democratic Republic with a Parliamentary System of government. It covers an area of 32872631 sq. km. Population, as on 1st March, 1991 (last counted) stood at 846.30 millions.
The value of total foreign trade increased to Rs.2,778,392.8 millions in 1997-98. During 1997-98, it’s total exports amounted to Rs.1,262,857.6 millions and imports increased to Rs.1,515,535.2 millions.
As on 20th April, 1999, Standard and Poor’s affirmed its ratings for India and said the country’s outlook was stable despite weak coalition governments. S&P affirmed its BB foreign currency and the BBB local currency ratings for India. The B foreign currency and A3 local currency short-term issuer credit ratings were also affirmed. The outlook is stable. Official foreign exchange reserves cover about 165 percent of total government, public sector and private sector external principal-repayment obligations due within the next 12 months. At $32.6 billion as on April 7, 1999, they mitigate the risk of a sudden loss of external confidence even as exports decelerate and the trade gap widens, the agency said.
LEADING EONOMIC INDICATORS
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Outstanding As On |
% Variation Over |
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Banking, M3 & Forex (Rs. mlns.) |
Feb. 26, 1999 |
End-March 1998 |
Financial Year So Far |
Year Ago |
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1997-98 |
1998-99 |
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Aggregate Deposits |
6,983,380 |
6,054,100 |
15.3 |
15.3 |
19.8 |
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Demand Deposits |
1,029,500 |
1,025,130 |
0.2 |
0.4 |
13.4 |
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Time Deposits |
5,953,880 |
5,028,970 |
18.7 |
18.4 |
20.9 |
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Investments |
2,519,660 |
2,187,050 |
12.3 |
15.2 |
17.7 |
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Government Securities |
2,203,170 |
1,869,570 |
14.2 |
17.8 |
21.4 |
|
Other Approved Securities |
316,490 |
317,480 |
2.7 |
-0.3 |
-2.3 |
|
Bank Credit |
3,547,420 |
3,240,790 |
12.4 |
9.5 |
13.3 |
|
Food Credit |
167,320 |
124,850 |
62.4 |
34.0 |
35.6 |
|
Non-food Credit |
3,380,110 |
3,115,940 |
11.0 |
8.5 |
12.4 |
|
Money Supply M3 (Feb. 26, 1999) |
9,455,060 |
8,253,890 |
13.4 |
14.6 |
18.8 |
|
Net Bank Credit to Government |
3,868,200 |
3,306,190 |
11.4 |
17.0 |
20.3 |
|
Reserve Bank Credit to
Government |
1,543,690 |
1,351,600 |
5.1 |
14.2 |
18.3 |
|
Bank Credit to Commercial
Sector |
4,651,290 |
4,321,900 |
11.8 |
7.6 |
10.6 |
|
FOREX (US$ mln.) March 19, 1999 |
312,350 |
293,670 |
7.0 |
6.4 |
10.5 |
|
Foreign Currency Assets |
282,560 |
259,750 |
11.1 |
8.8 |
13.7 |
FOREIGN INSTITUTIONAL INVESTMENT IN INDIA
|
Financial Year |
Gross Purchases (Rs. mlns.) |
Gross Sales (Rs. mlns.) |
Net Investment (Rs. mlns.) |
|
|
|
|
|
|
1992-93 |
175 |
40 |
135 |
|
1993-94 |
55,927 |
4,665 |
51,262 |
|
1994-95 |
76,310 |
28,354 |
47,966 |
|
1995-96 |
96,930 |
27,520 |
69,420 |
|
1996-97 |
155,540 |
69,804 |
85,746 |
|
1997-98 |
186,948 |
127,373 |
59,577 |
|
1998-99 |
161,150 |
176,993 |
-15,844 |
|
Total |
732,980 |
434,749 |
298,262 |
FOREIGN EXCHANGE RATES
|
Currency |
Unit |
Indian
Rupees |
|
US Dollar |
1 |
Rs.43.24 |
|
UK Pound |
1 |
Rs.71.03 |
|
Euro |
1 |
Rs.46.08 |
Attachment 5
ACKNOWLEDGEMENT
Dear Sir/Madam,
As part of our control
system, please fax/email us this note
upon receipt of this report. If we do not receive the acknowledgement within 24
hours, we will assume that our report meets your requirement. If you have any
suggestion to help us improve our reports and services, please do not hesitate
to let us know.
Thank you.
________________________________________________________________________
To : MIRA INFORM PRIVATE
LIMITED
From :
To :
Feedback – Please tick
the appropriate box.
------------------------------------------------------------
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Company’s Stamp &
Signature