MIRA INFORM REPORT

Report Date :

01.01.2007

IDENTIFICATION DETAILS

Name :	CEAT LIMITED
Registered Office :	Ceat Mahal, 463, Dr. Annie Besant Road, Worli, Mumbai – 400025, Maharashtra
Country:	India
Financials (as on):	31.03.2006
Date of Incorporation :	10.03.1958
Com. Reg. No.:	11-11041
CIN No.: [Company Identification No.]	L25100MH1958PLC011041
TAN No.: (Tax Deduction & Collection Account No.)	MUMC10660G MUMC11397B
PAN No.: (Permanent Account No.)	AAACC1645G
Legal Form :	Public Limited Liability Company. The company’s shares are listed on the Stock Exchanges.
Line of Business :	Manufacturing and Marketing of Automotive Tyres, Automotive Tubes and Automotive Flaps.

RATING & COMMENTS

MIRA’s Rating :

Ba

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Maximum Credit Limit :	USD 14000000
Status :	Satisfactory
Payment Behaviour :	Slow by average 30 days
Litigation :	Clear
Comments :	Subject is a well established company having satisfactory track. Directors are reported as experienced, respectable and having substantial means of their own. Their trade relations are fair. Payments are reported as slow by average 30 days. The company can be considered normal for business dealings at usual trade terms and conditions.

LOCATIONS

Registered/Corporate Office :	Ceat Mahal, 463, Dr. Annie Besant Road, Worli, Mumbai – 400025, Maharashtra, India
Tel. No.:	91-22-24930621/24616054/25640461/25660461/63
Fax No.:	91-22-24606039/25640301/25663964
E-Mail :	shaileshjoshi@ceatltd.com iikhan@ceatltd.com
Website :	http://www.ceattyres.com
Head Office :	6, Lotus House, Sir Vithaldas Thakersey Marg, New Marine Lines, Mumbai – 400 020, Maharashtra, India
Tel. No.:	91-22-28570014/0378/0376
Factory 1 :	· Village Road, Bhandup, Mumbai – 400 078, Maharashtra
Factory 2 :	· 82, MIDC Industrial Estate, Satpur, Nasik – 422 007, Maharashtra
Regional Offices:	1207, 12th Fl, Modicrop Tower 98, Nehru Place New Delhi - 110 019 Telephone 91-11-51618491 Fax 91-11-26444098 Sco 201, 2, 3, 1st Floor, Sub City Centre, Sector 34-A, Chandigarh Telephone 91-172-622057/8 Fax 91-172-622728 2^nd Floor, Satnam Complex, Near BMC Chowk, Jalandhar – 144 001 Telephone 91-181-2244094 Fax 91-181-2244094 Scf No 70, 2nd Floor, Sector 15, Market, Faridabad – 121 007 Telephone 91-129-5008021/2 Fax 91-129-2429823 C/O Umeed Auto, Auto Market Hissar Road, Rohtak – 124 001 Telephone 91-1262-49895 Sahni Motors Building, 62 Punjab Pura, Delhi Road, P B No 374, Meerut – 250 002 91-121-513635 Fax 91-121-513871 201 A, R H Tower, The Mall, (Next to HTL Clarks), Varanasi – 221102 Telephone 91-542-2503919 Fax 91-542-341919 39, Factory Area, Fazalganj, Kanpur – 208 012 Telephone 91-512-219741 Fax 91-512-216522 307, 3^rd Floor, Paradise C-61-A, Sarojini Marg, C Scheme Jaipur – 302 001 Telephone 91-141-2372808 Fax 91-141-2372022 DRTC House, 1st Floor Cinema Bldg, Behind Olympic Cinema, Jodhpur – 342 001 Telephone 91-291-616237 Fax 91-291-640721 Plot No 85, Bypass Road, 36-232, D, 1^st Floor New Agra – 282 001 Telephone 91-562-2524840 Fax 91-562-2524839 HCL Compound, Niranjan Pur, Saharanpur Road, Dehradhun – 248 001 Telephone 91-135-2001237 792, Sherpur Bypass, Ludhiana – 141 003 Telephone 91-161-2675577 Fax Telephone 91-161-2674755 1st Floor, Dhesagar Complex, Opp Dr Wadi Hospital, Goniana Road, Bhatinda – 151 001 Telephone 91-164-2216706 3^rd Floor, Duncan House 31, N.S. Road, Kolkata – 700 001 West Bengal Telephone 91-33- 22130343 Fax 91-33- 22130346 1^st Floor 189, G T Road (East),Rambandhu Talaw, Asansol – 713 303 Telephone 91-341-213017 Fax 91-341-213017 7, I A S Colony, Kidwaipuri, Patna – 800 001 Telephone 91-612-2524550 Fax 2520511 Arjan Place, 3^rd Floor, 5, Main Road, Ranchi – 834 001 Telephone 91-651-2207252 Fax 91-651-206067 R No 407, 4^th Floor Nirmala Plaza, A-1 Forest Park, Bhubaneswar – 751 009 Telephone 91-674-2595494 Fax 2595092 Udyog Bikas Bhavan Bhangagarh, G S Road, Guwahati – 781 005 Telephone 91-361-2529060 Fax 91-361-529315 5^th Floor, Akarshan Complx, Central Bazar Road Ramdaspeth, Nagpur – 440 012 Telephone 91-712- 2547443,55 Fax 91-712- 2547444 13/A, 2^nd Floor, Krishna Keval, Commercial Complex, Kondhwa Pune – 411 048 Telephone 91-20-6835402/3 Fax 91-20-6835404 15, South Civil Lines Caravs Building, Jabalpur – 482 001 Telephone 91-761-325712 Fax 91-761-320531 219, 220, 2^nd Floor 6, Indraprastha Tower, M G Road, Indore – 452 001 Telephone 91-731-5091909 Fax 91-731-2524261 Neeldhara, 1^st Floor Pritamrai Road, Ellis Bridge, Ahmedabad – 380 006 Telephone 91-79-26577672/73 Fax 91-79-26577297 404, Star Chambers, Harihar Chowk, Panchnath Plot, Rajkot – 360 001 Telephone 91-281-220217/8 Fax 91-281-291302 S J Logistics, B-29/4 Devendra Nagar, Raipur – 492 004 (CG) Telephone 91-771- 2582712 Fax 91-771- 25821812/2564112 C/O Rajkiran Agency Godown No 1, Plot No 2526, Behind KMT Petrol Pump, Shiroli, Kolhapur – 416 122 Telephone 91-95231- 2462701/2 108/109, Thakkar Tower, Plot No 86, Sec 17, Vashi, Navi Mumbai Telephone 91-22 55912641 No 2, Vijayaraghava Road, T Nagar, Chennai – 600 017 Telephone 91-44-24356387/044-24360769 Fax 91-44-24362519 Sri Sai Baba Chambers, No 2, 1^st Floor, 16, Bharatiya Park Road, Coimbatore – 641 043 Telephone 91-422-453939 Fax 91-422-450157 Pritam Plaza, 1^st Floor, 82, Chandrakant Nagar Ponmeni, Bypass Road, Madurai – 625 010 Telephone 91-452-2387763/4 Safeena Mansion, P B No 1755, M G Road, Ernakulam – 682 016 Telephone 91-484-353640 Fax 91-484-372720 Jasmine Mansion, 19, J C Road, Bangalore – 560 002 Telephone 91-80-2222388 Fax 91-80-2235027 8, Havelock Road, P B No 23, Camp, Belgaum – 590 001 Telephone 91-831-2423482 Fax 91-831-2426552 Flat No 418, Maheshwari Chamber, 6-3-650, Somaji Guda, Hyderabad – 500 082 Telephone 91-40-23396722 Fax 91-40-23396539 54/15-3, Srinagar Colony, Ring Road, Vijayawada – 520 008 Telephone 91-866-450170 Fax 91-866-450073

DIRECTORS

Name :	Mr. R. P. Goenka
Designation :	Chairman
Other Directorship :	Ø CESC Limited – Director Ø Saregama India Limited – Director Ø Jubilee Investments and Ind. Limited - Director Ø Hilltop Holdings India Limited – Director
Name :	Mr. H. V. Goenka
Designation :	Vice Chairman
Name :	Mr. Paras K. Chowdhary
Designation :	Managing Director (Appointed on 18/01/2001)
Name :	Mr. M. A. Bakre
Designation :	Director
Other Directorship ;	Ø Garware Wall Ropes Limited – Director Ø FGP Limited – Director
Name :	Mr. A. C. Choksey
Designation :	Director
Date of Appointment :	28/01/2000
Name :	Mr. Hari L. Mundra
Designation :	Director
Name :	Mr. S. Doreswamy
Designation :	Director
Date of Appointment :	27/07/2000
Other Directorship :	Ø Can Fin Homes Limited - Chairman Ø Pantaloon Retail [India] Limited – Director Ø Kaytee Switchgear Limited – Director Ø Sakthi Sugar Limited – Director Ø Sakthi Auto Component Limited – Director Ø Deposit Insurance and Credit Guarantee Corporation Limited – Director Ø Caliberpoint Business Solutions Limited – Director
Name :	Mr. J. N. Guzder
Designation :	Director
Name :	Mr. H. Khaitan
Designation :	Director
Name :	Mr. B. S. Mehta
Designation :	Director
Other Directorship :	Ø Atul Limited – Director Ø Bharat Bijlee Limited – Director Ø Century Enka Limited – Director Ø Housing Development Finance Corporation Limited – Director Ø IL & FS Investment Mergers Limited [Formerly known as IL & FS Venture Corporation Limited] – Director Ø J. B. Chemicals & Pharmaceuticals Limited - Director Ø Pidilite Industries Limited – Director Ø Procter and Gamble Hygiene and Health Care Limited – Director Ø Sasken Communication Technologies Limited – Director Ø SBI Capital Markets Limited – Director Ø Sudarshan Chemical Industries Limited – Director Ø The Dawn Mills Company Limited – Director Ø Varun Shipping Company Limited – Director Ø Vinyl Chemicals [India] Limited – Director
Name :	Mr. K. R. Podar
Designation :	Director
Name :	Mr. Mahesh S. Gupta
Designation :	Director (Appointed on 02/05/2002)

KEY EXECUTIVES

Name :	Mr. H. N. Singh Rajpoot
Designation :	Company Secretary
Audit Committee :
Mr. M. A. Bakre	Chairman
Mr. Mahesh S. Gupta	Member
Mr. S. Doreswamy	Member
Mr. Hari L. Mundra	Member
Shareholders / Investors Grievance Committee :
Mr. M. A. Bakre	Chairman
Mr. Paras K. Chowdhary	Member
Mr. Mahesh S. Gupta	Member

MAJOR SHAREHOLDERS

Category	No. of Shares held	% of Shares
Individuals / Hindu Undivided Family	37491	0.08
Bodies Corporate	17300832	37.89
Foreign	2376465	5.21
Mutual Funds / UTI	6674252	14.62
Financial Institution / Bank	11185	0.02
Insurance Companies	5572771	12.21
Foreign Institutional Investors	11473840	2.57
Non Institutional		0.00
Bodies Corporate	3414966	7.48
Individual shareholders holding nominal share capital upto Rs. 0.1 millions	7849310	17.19
Individual shareholders holding nominal share capital upto Rs. 0.1 millions	1218803	2.67
Any Other	5256	0.01
Directors and Relatives	21365	0.05
Total	12509700	100.00

BUSINESS DETAILS

Line of Business :

Manufacturing and Marketing of Automotive Tyres, Automotive Tubes and Automotive Flaps.

Product :

Item Code No. (ITC Code)	4011
Product Description	Automotive Tyres
Item Code No. (ITC Code)	4012
Product Description	Automotive Flaps
Item Code No. (ITC Code)	4013
Product Description	Automotive Tubes

Brand Name :

CEAT, CEAT SECURA, CEAT ENDURA, CEAT MAESTRO, etc.

PRODUCTION STATUS

PARTICULARS	Unit	Licensed Capacity	Installed Capacity	Actual Production
Automotive Tyres	Nos in Millions	4.947	4.311	7.640
Automotive Tubes	Nos in Millions	4.947	0.848	8.320
Automotive Flaps	Nos in Millions	--	--	2.430

GENERAL INFORMATION

No. of Employees:	4928
Bankers :	· Bank of India Mumbai Corporate Banking Branch, 70-80, Mahatma Gandhi Road, Mumbai – 400023, Maharashtra · Bank of Baroda · Indian Bank · State Bank of India · UCO Bank · Vijaya Bank · Corporation Bank · State Bank of Travancore · The Dhanalakshmi Bank Limited · ICICI Bank Limited · The Karnataka Bank Limited · The United Western Indian Bank · Export-Import Bank of India

Facilities :

(Rs. in millions)

Secured Loans	31.03.2006
Debentures :-
13.50% (13.50%) Secured Redeemable Non-Convertible Debentures	21.428
Loans from Financial Institutions
IFCI Limited	21.430
ICICI Bank Limited	100.000
Industrial Development Bank of India	221.600
The Federal Bank Limited	56.232
Indian Bank	547.892
Working Capital term Loan	331.711
Bank Borrowings :-
Working Capital Demand Loan	52.041
FCNR – B Loan	--
Cash Credit Facilities	225.120
Export Packing Credit	1317.493
Vehicles Loans	17.277
Interest accrued and due	--

Unsecured Loans	31.03.2005
Term Loan
IL & FS Limited	35.000
Bank	275.949
Public Deposits	600.603
Inter-corporate Deposits	98.800
Commercial Paper	--
Interest Free Sales Tax Loan	27.851
Deferred Sales Tax Incentive	225.985

Banking Relations :	Satisfactory
Auditors :	· N. M. Raiji & Company Chartered Accountants
Associates/Subsidiaries :	v Associated CEAT Holdings Company (Private) Limited v CEAT-Kelani Associated Holdings Company (Private) Limited v Associated CEAT (Private) Limited, v CEAT-Kelani International Tyres (Private) Limited v ACT Limited v Associated CEAT Kelani Radials Limited v Rado Tyres Limited v Zensar Technologies Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
46100000	Equity Shares	Rs.10/- each	Rs.460.999 millions
3900000	Preference Shares	Rs.10/- each	Rs. 39.000 millions
10000000	Unclassified Shares	Rs.10/- each	Rs.100.001 millions
GRAND TOTAL			Rs. 600.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
45656626	Equity Shares	Rs.10/- each	Rs.456.566 millions
Less :	Allotment Money/Calls in Arrears		Rs. 0.233 millions
GRAND TOTAL			Rs. 456.799 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2006	31.03.2005	31.03.2004
SHAREHOLDERS FUNDS
1] Share Capital		456.799	350.981	350.920
2] Reserves & Surplus		3033.244	5950.397	5894.682
NETWORTH		3490.043	6301.378	6245.602
LOAN FUNDS
1] Secured Loans		2912.227	3388.534	3195.188
2] Unsecured Loans		1264.188	1117.832	1508.928
TOTAL BORROWING		4176.415	4506.366	4704.116
DEFERRED TAX LIABILITIES		139.885	419.265	420.854
TOTAL		7806.343	11227.009	11370.572
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		7217.056	5294.435	4981.986
Capital work-in-progress		42.735	150.327	106.570
INVESTMENT		1278.090	1907.936	1908.403
DEFERREX TAX ASSETS		0.000	289.380	280.969
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	1834.544	1682.042	1723.017
	Sundry Debtors	2532.277	2366.003	2471.371
	Cash & Bank Balances	396.127	312.363	388.930
	Loans & Advances	630.459	5252.361	5260.508
Total Current Assets		5393.407	9612.769	9843.826
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	5739.567	5562.147	5500.765
	Provisions	385.378	465.691	250.417
Total Current Liabilities		6124.945	6027.838	5751.182
Net Current Assets		[731.538]	3584.931	4092.644
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		7806.343	11227.009	11370.572

PROFIT & LOSS ACCOUNT

PARTICULARS	31.03.2006	31.03.2005	31.03.2004
Sales Turnover [including other income]	17700.518	15669.754	15018.285
Profit/(Loss) Before Tax	52.174	[28.742]	222.179
Provision for Taxation	46.998	[10.000]	81.600
Profit/(Loss) After Tax	5.176	[18.742]	140.579
Export Value	3935.029	2595.019	2067.508
Import Value	3596.379	3381.377	2331.421
Total Expenditure	17648.344	15747.009	14589.888

QUARTERLY RESULTS

Particulars	30.06.2006	30.09.2006
Type	1st Qtr	2nd Qtr
Sales Turnover	4976.600	5375.700
Other Income	64.200	37.700
Total Income	5040.800	5413.400
Total Expenditure	4791.200	5110.700
Operating Profit	249.600	302.700
Interest	161.200	158.500
Gross Profit	88.400	144.200
Depreciation	75.500	77.700
Tax	10.600	15.200
Reported PAT	02.300	38.300

200606 Quarter 1 –

1. Continuous rise in prices of natural rubber and petroleum based raw materials has led to steep increase 1 in material cost. Tyre prices could not be increased commensurately resulting in severe pressure on margins. 2. Considering the organization structure, nature of products and risk & return profile based on geographical distribution, the tyre business is considered as the only Reportable business segment in accordance with the Accounting Standard (AS 17) 'Segment Reporting'. 3. Investor's queries received and disposed off during the quarter ended 30^th June, 2006 Numbers Pending at the beginning of the quarter 2 Received during the quarter 5 Attended during the quarter 6 Unresolved as on 30.06.06 and are in the Process of being attended to 1 4. The Honourable High Court of Judicature at Bombay has sanctioned the Scheme of Amalgamation of erstwhile 3 wholly owned subsidiaries namely CEAT Ventures Limited, CEAT Holdings Limited and Meteoric Industrial Finance Company Limited with CEAT Limited on 30^th June, 2006. The appointed date for the Amalgamation was 1^st April 2005. Therefore the Accounts for the year ended 31st March, 2006 include the Amalgamated companies' transactions pursuant to the terms of the scheme of Amalgamation as approved by the Honourable High Court of Bombay. In view of the Amalgamation, the figures for the current quarter are not comparable with those of previous quarter. 5. The figures have been regrouped / rearranged wherever considered necessary to conform to current period year's classification and grouping. 6. The above results were reviewed by the Audit Committee and were thereafter taken on record by the Board of Directors at their meeting held on 31^st July, 2006. 7. The Statutory Auditors have carried out 'Limited Review' of the financial results for the quarter ended 30^th June, 2006 as required under Clause 41 of the Listing Agreement.

200609 Quarter 2 –

1. The Government of India has reduced the export incentive by 50% with retrospective effect ftom tat April, 2005. Representations have been made by several industrial forums for reinstatement of the export incentive. The differential amount of Rs.66 Millions would be dealt with on receipt of conclusive response from Government of India. 2. Considering the organization structure, nature of products and risk & return profile based on geographical distribution, the tyre business is considered as the only reportable business segment in accordance with the Accounting Standard (AS 17) 'Segment Reporting'. 3. There was 1 investor complaint pending at the beginning of the quarter, 9 complaints were received during the quarter and all 10 complaints were resolved during the quarter. Thus there were no investor complaints pending at the end of the quarter ended 30^th September, 2006. 4. a) The figures have been regrouped/rearranged wherever considered necessary to conform to current period/year's classification and grouping, b) Current period's result is not comparable with previous period's result due to effect of Scheme of Amalgamation incorporated in the last quarter of the previous financial year. 5. The above results were reviewed by the Audit Committee and were there after taken on record by the Board of Directors at their meeting held on Sill October, 2006. 6. The Statutory Auditors have carried out 'Limited Review' of the financial results for the quarter ended 30^th September, 2006 as required under Clause 41 of the Listing Agreement.

KEY RATIOS

PARTICULARS	31.03.2006	31.03.2005	31.03.2004
Debt Equity Ratio	1.34	1.46	1.44
Long Term Debt Equity Ratio	0.74	0.88	0.96
Current Ratio	0.92	1.23	1.32
TURNOVER RATIOS
Fixed Assets	2.35	3.25	3.11
Inventory	11.10	10.46	9.51
Debtors	7.97	7.36	7.59
Interest Cover Ratio	1.07	0.89	1.45
Operating Profit Margin (%)	5.12	4.87	8.88
Profit Before Interest and Tax Margin (%)	3.97	3.63	7.54
Cash Profit Margin (%)	1.18	0.87	2.82
Adjusted Net Profit Margin (%)	0.03	[0.37]	1.47
Return on Capital Employed (%)	10.24	8.33	15.49
Return on Net Worth (%)	0.16	[2.09]	7.38

STOCK PRICES

Face Value	Rs. 10.00/-
High	Rs. 65.70/-
Low	Rs. 36.10/-

LOCAL AGENCY FURTHER INFORMATION

History:

Subject was incorporated on 10^th March 1958 at Mumbai in Maharashtra having Company Registration Number 11041.

The company was set up with a capital of Rs. 11.500 millions contributed in a 60:40 ratio by CEAT (Cavi Electric Affini Torino) of Turin, Italy, and the Investment Corporation of India (A TATA Group Company). Its’ first tyre rolled out from its factory at Bhandup in Maharashtra on February 22, 1960. By the end of that year, the rapidly expanding workforce consisting of 200 workers, produced a total of 45,246 tyres. Today, company's total production per annum is close to 6 million units, making the company among the top 20 tyre companies in the world. Over the past few years, the company has restructured by divesting loss making non-core businesses of glass fibber, NTCF and photocopiers. The company divested its other business viz. nylon tyre cord division and fibreglass plant and now consolidating its position through takeovers and joint ventures.

The flagship of the RPG group, manufactures steel-belted radials for passenger cars. The various range of tyres manufactured are marketed under “Ceat”, “Samrat” and “Secura” brand names.

With the amalgamation of Deccan Fibre Glass in 1983 and Murphy India (a BIFR company) in 1970, Ceat acquired the glass fibre unit and the electronics division respectively. It also acquired Murphy’s photocopier division, which had Ricoh, Japan, as the technology supplier. The glass fibre unit was sold to FGP in June 1993. While the operations of Electronics Division have been suspended from 1992-93 onwards, Associated Ceat (Private) Limited, the company’s joint venture in Sri Lanka, commenced production of tyres for LCVs towards the end of 1993.

The Photocopier Division was sold to RPG Ricoh in May 1994. The company also transferred its Aurangabad unit to South Asia Tyres, a joint venture with Goodyear India, in financial collaboration with Goodyear Tyre Company, US, to manufacture radial and earthmover tyres.

The radial tyre plant has commenced commercial production in Nasik and the formula one radial tyres have been well received in the market.

The company is planning to acquire the capacity in the newer plants in Baroda and Hyderabad to produce two wheeler tyres for the company. The production in Hyderabad plant was expected in August, 2002.

The company is the first tyre company in India to have been awarded the International accreditation ISO/TS 16949 - 2002 Quality Standard Certification.  

The company has entered into agreement with Pirelli of Italy for outsourcing radial tyres, which are marketed in the brand name, CEAT Spider Radials. The company is exporting its products to nearly 50 countries and is entering into the new markets namely Thailand, Hong Kong, Eritrea and Israel

Business:

Subject is engaged in the business as manufacturers and marketers of Automotive Tyres, Automotive Tubes and Automotive Flaps.

The company is the second largest tyre manufacturer in the country.

CEAT'S PERFORMANCE: 

CEAT's sales performance was generally in line with that of the industry. The Company registered a revenue growth of 14 % during the year under review. The key driver of this growth was exports, which registered a healthy growth of 52%.

CEAT sustained its focus on market development, particularly new markets in Europe and Australia and a commitment to total quality management across the organization has improved operating cost efficiencies. Consequently, operating profit of the company increased from Rs. 785.2 Millions in the previous year to Rs.912.2 Millions in the year under review, despite the steep rise in input costs.

EXPORTS 

The steps taken in the past towards consolidation of existing markets and development of newer markets in Europe and Australia have paid dividends and the Company's exports (FOB) for the year stood at Rs. 3940 Millions, higher by 52% over last year. Exports will continue to receive close attention and is expected to contribute to a great extent in the future revenue growth of the Company.

FUTURE OUTLOOK

Tyre industry is expected to maintain its robust growth buoyed by the increase in demand for automobiles and encouraging growth in key sectors of the Indian economy.

The Central Government's continued thrust on road and infrastructure projects will give a much anticipated boost to the overall movement of goods and vehicles across the important trading and consumer destinations of the country leading to an increase in demand for tyres. The recent legislation imposing load restrictions and safety standards has also led to an improved discipline in usage and replacement of tyres and also strengthened demand in the domestic market. CEAT has ensured a balanced product portfolio in order to tap the opportunities presented by these developments.

CEAT's business plan for financial year 2006-07 takes into account a focus on greater value addition to its product portfolio and expansion of its car radial capacity, which together should reflect in improved margins in the coming year.

ASSOCIATED CEAT-KELANI VENTURE 

CEAT's joint venture in Sri Lanka, registered a modest revenue growth of 7%, up from SL Rs. 2713 million in the previous year to SL Rs. 2910 million for the year under review. The profit for the year at SL Rs. 54 million was lower as compared to the profit of SL Rs. 83 million for the previous year. The earnings could have been substantially higher but for the loss of production in one of the two manufacturing units on account of labour issues, which have since been settled through a long term productivity linked wage settlement.

This venture is already a market leader in the bias segment with a market share of over 50%. It is currently implementing a new project to manufacture 26,000 passenger car radial tyres per month. With substantial increase in productivity and the foray into radial segment, revenue and profitability of this venture are expected to see significant improvement in the coming years .

AUTHORISED SHARE CAPITAL

Pursuant to Article 5 of The Articles of Association of the Company, the Board of Directors at its meeting held on 23rd September 2005 have re-classified 108,86,680 as equity shares of Rs. 10/- each out of total 208,86,680 unclassified shares of Rs. 10/- each as mentioned in the last balance sheet in order to facilitate issue of equity shares of Rs. 10/- each on rights basis in terms of Letter of Offer dated 8th December 2005.

The company is in trade terms with the following :

v Accura Valves

v Acmechem Private Limited

v Alfred Rubber Products

v Bharat Rubber Regenerating Limited

v Deekay Clutches

v Grand Wood Works & Saw Mill

v Pukhraj Engineering & Chemicals

v Rajashree Enterprises

v Solar Chemferts Private Limited

v Suraiya Private Limited

v Shree Samarth Industries

v Vibros Rubber Products Private Limited

v Burad Chemicals Private Limited

v Micro Belts & Tyres Private Limited

The company’s fixed assets of important value includes land, building, plant and machinery, furniture and fixtures and vehicles.

As per Web Details :

About us

The oldest of the RPG Enterprises companies, CEAT Tyres was established in 1958. Today, they are one of India’s leading tyre manufacturers, with an annual turnover of Rs 1,7800 Millions (US $400 million). Their solid brand equity has empowered us to establish a strong presence in both, domestic and international markets. Their tyres, tubes and flaps are renowned for their superior quality and durability, and are recognized as being ‘born tough’.

They offer the widest range of tyres to all user segments, and manufacture world-class radials for all Indian vehicles including:

Ø Heavy-duty Trucks and Buses

Ø Light Commercial Vehicles

Ø Earthmovers

Ø Forklifts

Ø Tractors

Ø Trailers

Ø Cars

Ø Motorcycles and Scooters

Ø Auto-rickshaws

They also market tubes and flaps, which are outsourced from 7 to 8 units.

Possessing an enviable list of clients

They enjoy long-standing business tie-ups with major OEMs including TATA Motors, Ashok Leyland, Mahindra & Mahindra, Maruti, L&T, Eicher, Swaraj Mazda, Caterpillar, Bajaj Tempo, Piaggio, Hero Honda, HMSI (wholly owned subsidiary of Honda Motors, Japan) and TVS Motors.

Focused on Quality

At CEAT, they continue to stay committed to enhancing the quality of their products and upgrading their technologies. It goes without saying that they adhere to the highest standards of safety. Testimony to their endeavours is the fact that they are the first and only Indian tyre company to be awarded the ISO/TS 16949:2002 certification, by TUV, a reputed certification body, based in Netherlands.

CEAT Quality Policy

They are customer-centric and consistently deliver excellent products and services at competitive prices. It is their endeavour to continually improve all their business processes and ensure conformance to the established quality systems. They accomplish this through constant upgrading of their employees’ skills.

History

Ø CEAT stands for Cavi Electrici Affini Torino (Electrical Cables and Allied Products of Turin).

Ø CEAT International was first established in 1924 at Turino in Italy and manufactured cables for telephones and railways.

Ø In 1958, CEAT came to India, and CEAT Tyres of India Limited was established in collaboration with the TATA Group.

Ø In 1982, the RPG Group took over CEAT Tyres of India, and in 1990, renamed the company CEAT Limited.

Current Scenario

Ø Manufactures over 6 million tyres every year.

Ø Enjoys 55% of the local market for light truck and truck tyres.

Ø Operates from plants in Mumbai and Nasik.

Ø Exports to USA, Africa and other parts of Asia.

Ø Has a robust network consisting of 36 regional offices, over 3,500 dealers and more than 100 C&F agents.

Ø Has a dedicated Customer Service department, comprising Customer Service Managers in all four divisional offices, assisted by 50 Service Engineers.

Vision and Mission

“CEAT will each time every time provide Total Customer Satisfaction through products and services of highest quality and reliability.

CEAT will nurture an exciting and challenging working environment embedded with fairness and free, frank exchange of views.”

Contact us

Exports

CEAT Mahal

463, Dr. Annie Besant Road, Worli

Mumbai – 400 030

Telephone: +91 22 2493 0621

Fax: +91 22 2493 8933

America, Europe and Far East

e-mail: sgulati@ceatltd.com

Middle East and Africa

e-mail: jyoti@ceatltd.com

Customer Cell

CEAT Mahal
463, Dr. Annie Besant Road, Worli
Mumbai – 400 030

Telephone: +91 22 2493 0621

Fax: +91 22 2493 8933

e-mail: customercare@ceatltd.com

OEM

CEAT Mahal
463, Dr. Annie Besant Road, Worli
Mumbai – 400 030

Telephone: +91 22 2493 0621

Fax: +91 22 2493 8933

e-mail: pkshukla@ceatltd.com

CMT REPORT [Corruption, Money laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No records exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

6] Records on Int’l Anti-Money Laundering Laws/Standards :

Charges or investigation registered against subject: None

7] Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

8] Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

9] Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

CONTRAVENTION

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.44.23
UK Pound	1	Rs.86.91
Euro	1	Rs.58.26

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	5
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	5
--CREDIT LINES	1~10	5
--MARGINS	-5~5	-
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		45

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
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
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.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	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
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions