MIRA INFORM REPORT
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Report Date : |
27.01.2007 |
IDENTIFICATION DETAILS
|
Name : |
MOSER
BAER INDIA LIMITED |
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Registered Office : |
43A,
Okhla Industrial Estate, New Delhi – 110 020 |
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Country : |
India
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Financials (as on) : |
31.03.2006 |
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Date of Incorporation : |
21.03.1983 |
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Com. Reg. No.: |
55-15418 |
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CIN No.: [Company Identification No.] |
L51909DL1983PLC015418 |
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TAN No.: [Tax Deduction & Collection Account No.] |
DELM08254B |
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PAN No.: [Permanent Account No.] |
AAACM0322J |
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Legal Form : |
Public
Limited Liability Company. The
company's shares are listed on the Stock Exchanges. |
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Line of Business : |
Manufacturer
of CDR, CDRW, DVDRW, Micro Floppy Diskettes, Audio-Video tape. |
RATING & COMMENTS
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MIRA’s Rating : |
A |
RATING
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STATUS |
PROPOSED CREDIT LINE |
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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 |
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Maximum Credit Limit : |
USD 80000000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject
is a well-established company having fine track. Directors are reported as
experienced, respectable and resourceful industrialists. Their trade
relations are fair. Financial position is good. Payments are usually correct
and as per commitments. The
company can be considered for normal business dealings at usual trade terms
and conditions. |
LOCATIONS
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Registered Office : |
43A,
Okhla Industrial Estate, New Delhi – 110 020, India |
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Tel. No.: |
91-11-51635201/02/03/04/05 |
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Fax No.: |
91-11-51635211 |
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E-Mail : |
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Website : |
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Plant Location: |
Tel.
No. : 91-120-2567023-25 Fax.
No. : 91-120-2562117
Pradesh Tel. No. : 91-120-2460800
Tel.
No. : 91-120-2567023-25 Fax
No. : 91-120-2562117
Tel.
No. : 91-120-2521662
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Branch Office : |
Mumbai Office: Bangalore Office: Calcutta Office: |
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International Offices : |
Japan: Taiwan: US West Coast: |
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Affiliate Offices (International) |
Europe: US East Coast: Dubai : |
DIRECTORS
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Name : |
Mr. Deepak Puri |
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Designation : |
Chairman and Managing Director |
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Address : |
A-187, New Friends Colony, New Delhi - 110065 |
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Date of Birth/Age : |
64 years |
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Qualification : |
B.Sc. Hons (Maths), B.Sc (Mechanical Engineering) |
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Experience : |
22 years |
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Name : |
Mr.
Ratul Pari |
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Designation : |
Director |
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Address : |
A-187, New Friends Colony, New Delhi – 110065 |
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Date of Birth/Age : |
33 years |
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Qualification : |
Bachelor’s degree in Maths and Computer Science. |
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Experience : |
4 years |
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Name : |
Mr.
Harnam D. Wahi |
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Designation : |
Director |
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Address : |
M – 95, Greater Kailash, Part – 1, New Delhi -
110048 |
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Date of Birth/Age : |
79 years |
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Qualification : |
Bachelor of Arts, |
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Experience : |
13 years |
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Name : |
Mrs.
Nita Puri |
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Designation : |
Director |
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Address : |
A-187, New Friends Colony, New Delhi – 110065 |
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Date of Birth/Age : |
59 years |
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Qualification : |
B.Ed. |
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Experience : |
22 years |
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Name : |
Mr.
Prakash Karnik |
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Designation : |
Director |
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Address : |
902, Glen Eagle, G. D. Ambedkar Marg, Mumbai –
400012 |
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Date of Birth/Age : |
53 years |
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Qualification : |
B.Tech from Indian Institute of Technology,
Diploma in Systems Management from Mumbai University and Diploma in Financial
Management from Mumbai University |
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Experience : |
7 years |
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Name : |
Mr.
Rajesh Khanna |
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Designation : |
Director |
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Address : |
11, Nathan Road, #02-01, Regency Park,
Singapore-248732 |
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Date of Birth/Age : |
40 years |
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Qualification : |
B.Com
from Mumbai University. Chartered Accountant and MBA from IIM, Ahmedabad. |
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Experience : |
5 years |
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Name : |
Mr.
Bernard Gallus |
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Designation : |
Director |
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Address : |
C/Del Rio Escalona 9 E-03739 Javea/Alicante Spain |
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Date of Birth/Age : |
73 years |
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Qualification : |
1.
Diploma State School for Commercial Activities and Administration,
Basel 2.
Course Intercedes Lausanne Course Suisse de Director d’ Enterprises |
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Experience : |
18 years |
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Name : |
Mr.
Arun Bharat Ram |
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Designation : |
Director |
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Address : |
1, Silver Oak Avenue, Westend Green Farms,
Phae-I, Rajokri, New Delhi-110038, India |
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Date of Birth/Age : |
65 years |
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Qualification : |
Graduate in Industrial Engineering from
University of Michigan, U.S.A. |
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Experience : |
3 years |
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Name : |
Mr.
John Levack |
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Designation : |
Director |
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Address : |
1110, Jardine House, 1, Connaught Place, Central,
HongKong |
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Date of Birth/Age : |
47 years |
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Qualification : |
Degree in Business Administration from Bath
University in U.K. |
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Experience : |
2 years |
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Name : |
Minni Katariya |
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Designation : |
Director |
MAJOR SHAREHOLDERS
|
Names of Shareholders |
No. of Shares |
Percentage of Holding |
|
Promoters and Associates |
1,8280,314 |
16.39% |
|
Warburg Pincus Group |
2,2956,570 |
20.59% |
|
Intern ational Finance Corporation |
1,4022,584 |
12.57% |
|
Electra Partners Mauritius
Limited |
6640,230 |
5.95% |
|
FIIs, Mutual Funds,
Companies, Banks, Insurance Companies |
2,4867,109 |
22.30% |
|
Deutsche Bank Trust
Americas (Share under lying 147000
GDRs) |
1,4700,000 |
13.19% |
|
Public |
1,0046,137 |
9.01% |
|
Total |
111,512,944 |
100.00% |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer
of CDR, CDRW, DVDRW, Micro Floppy Diskettes, Audio-Video tape. |
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Products : |
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Brand Names : |
"Xydan" |
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Exports to : |
U.S.A.,
UAE, Germany, Luxemburg, Australia, Poland, Italy, Korea, Russia, Singapore,
Spain, The Netherlands, Brazil, Finland and Angola |
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Imports from : |
Singapore, Japan, China and
Taiwan. |
PRODUCTION STATUS
|
Class of Goods |
Installed Capacity |
Actual Production |
|
Storage
Media (Nos.) |
2125820000 |
1608396069 |
GENERAL INFORMATION
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No. of Employees : |
5013 |
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Bankers : |
Ř
State Bank of Bikaner
& Jaipur Ř
State Bank of
Travancore Ř
State Bank of
Saurashtra, Connaught Place Branch, Delhi -
110 001 Ř
Indian Bank, P 45/70,
Connaught Circus, P. O. Box 721, Delhi - 110 001 Ř
State Bank of Patiala |
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Facilities : |
-- |
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Banking Relations : |
Good |
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Auditors : |
K. C. Khanna & Company Chartered Accountants |
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Associates/Subsidiaries
: |
Ř
Global Data Media
FZ-LLC, P. O. Box No. 500289, Dubai, United Arab Emirates Line
of Business : Storage Media Ř
European Optic Media
Technology GmbH, Mainzerhofstrase 12, 99084, Erfurt, Germany Line of Business : Storage Media Subsidiaries Ř
Glyphics Media inc
U.S.A. |
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MEMBERSHIPS : |
Confederation of Indian
Industry |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
142,500,000 |
Equity
Shares |
Rs. 10/- each |
Rs. 1425.000 millions |
|
750,000 |
Preference
Shares |
Rs. 10/- each |
Rs. 75.000 millions |
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Total |
|
Rs. 1500.000 millions |
Issued, Subscribed
& Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
111,510,000 |
Equity
shares |
Rs. 10/-
each |
Rs. 1115.100 millions |
FINANCIAL
DATA
[all figures are in Rupees Millions]
ABRIDGED
BALANCE SHEET
|
SOURCES OF FUNDS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
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|
SHAREHOLDERS FUNDS |
|
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|
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1] Share Capital |
1115.100 |
1115.100 |
1115.129 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
18933.400 |
18832.400 |
18352.371 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH
|
20048.500 |
19947.500 |
19467.500 |
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LOAN FUNDS |
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1] Secured Loans |
16465.400 |
16037.900 |
14387.677 |
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2] Unsecured Loans |
89.300 |
168.300 |
132.167 |
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TOTAL
BORROWING
|
16554.700 |
16206.200 |
14519.844 |
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DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
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Deferred Credit Liabilities |
0.000 |
0.000 |
345.144 |
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Share
Warrants- fully convertible |
0.000 |
0.000 |
181.440 |
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TOTAL
|
36603.200 |
36153.700 |
34513.928 |
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APPLICATION OF FUNDS
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FIXED ASSETS [Net Block]
|
24319.300 |
24471.700 |
22686.556 |
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Capital work-in-progress
|
1279.500 |
418.300 |
875.651 |
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Incidental Expenditures
|
0.000 |
0.000 |
4.861 |
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INVESTMENT
|
879.500 |
2075.200 |
524.469 |
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DEFERREX TAX ASSETS
|
0.000 |
0.000 |
0.000 |
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CURRENT ASSETS, LOANS & ADVANCES
|
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Inventories
|
4469.900 |
3435.400 |
1984.976 |
|
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Sundry Debtors
|
3798.900 |
3315.400 |
3059.948 |
|
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Cash & Bank Balances
|
2837.200 |
4589.900 |
7944.656 |
|
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Loans & Advances
|
1661.600 |
2029.100 |
781.489 |
Total Current Assets
|
12767.600 |
13369.800 |
13771.069 |
|
Less : CURRENT LIABILITIES & PROVISIONS
|
|
|
|
|
|
|
Current Liabilities
|
2370.700 |
3937.200 |
3075.359 |
|
|
Provisions
|
272.000 |
244.100 |
273.319 |
Total Current Liabilities
|
2642.700 |
4181.300 |
3348.678
|
|
Net Current
Assets
|
10124.900 |
9188.500 |
10422.391 |
|
|
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MISCELLANEOUS EXPENSES
|
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
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TOTAL
|
36603.200 |
36153.700 |
34513.928 |
|
PROFIT & LOSS ACCOUNT
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
Sales Turnover [including other income]
|
18490.600 |
15076.600 |
15571.395 |
|
|
|
|
|
Profit/(Loss) Before Tax
|
39.600 |
302.400 |
3626.467 |
Provision for Taxation
|
(7.100) |
304.800 |
49.213 |
Profit/(Loss) After Tax
|
46.700 |
607.200 |
3577.254 |
|
|
|
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Export Value
|
NA |
NA |
12347.425 |
|
|
|
|
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Import Value
|
NA |
NA |
11430.983 |
|
|
|
|
|
Total Expenditure
|
14348.000 |
14446.100 |
11944.928 |
QUARTERLY
RESULTS
|
PARTICULARS |
|
30.06.2006 [1st Quarter] |
30.09.2006 [2nd Quarter] |
|
Sales Turnover |
|
4545.200 |
5008.600 |
|
Other Income |
|
335.700 |
123.800 |
|
Total Income |
|
4880.900 |
5132.400 |
|
Total Expenditure |
|
3672.800 |
3678.000 |
|
Operating Profit |
|
1208.100 |
1454.400 |
|
Interest |
|
289.100 |
300.400 |
|
Gross Profit |
|
919.000 |
1154.000 |
|
Depreciation |
|
852.100 |
89.1.100 |
|
Tax |
|
02.200 |
3.200 |
|
Reported PAT |
|
64.700 |
259.700 |
200606 Quarter 1 --
Notes
Net Sales
includes Gross Sales Rs 4756.41 million Duties Rs (211.20) million Expenditure
includes (Increase)/Decrease in stock in Trade Rs (78.70) million Consumption
of Raw Materials, stores etc Rs 2695.93 million Staff Cost Rs 327.32 million
Other expenditure Rs 727.95 million Tax indicate Provision for Fringe Benefit
Tax EPS is Basic & Diluted Status of Investor Complaints for the quarter
ended June 30, 2006 Complaints Pending at the beginning of the quarter Nil
Complaints Received during the quarter 14 Complaints disposed off during the
quarter 14 Complaints unresolved at the end of the quarter Nil 1. Considering
the nature of the Company's business, its activities and location of production
facilities, the internal financial reporting, element of risks and returns and
its predominant product being storage media, there are no business and
geographical segments within the meaning of Accounting Standard 17-Segment
Reporting, issued by the Institute of chartered Accountants of India. 2. In the
Annual General Meeting held on July 19, 2006 the shareholders had approved
payment of dividend @10% for the year 2005-06 amounting to Rs 111,512,944 on
111,512,944 Equity Shares of Rs 10 each. 3. The above results for the quarter
ended June 30, 2006 were reviewed by the Audit Committee and were taken on
record by the Board of Directors in their meeting held on July 27, 2006.
200609 Quarter 2
Notes
Net Sales includes Gross
Sales Rs 5248.36 million Less: Duties Rs (239.81) million Expenditure includes
(Increase)/Decrease in stock in Trade Rs (253.14) million Consumption of Raw
Materials, stores etc Rs 2709.32 million Staff Cost Rs 349.73 million Other
expenditure Rs 872.07 million Tax indicate Provision for Fringe Benefit Tax EPS
is Basic & Diluted Status of Investor Complaints for the quarter ended
September 30, 2006 Complaints Pending at the beginning of the quarter Nil
Complaints Received during the quarter 13 Complaints disposed off during the
quarter 13 Complaints unresolved at the end of the quarter Nil 1. Considering
the nature of the Company's business, its activities and location of production
facilities, the internal financial reporting, element of risks and returns and
its predominant product being storage media, there are no business and
geographical segments within the meaning of Accounting Standard 17 - Segment
Reporting, issued by the Institute of Chartered Accountants of India. 2. During
the quarter ended September 30, 2006 the Company has established Peraround Ltd
as its wholly owned subsidiary company in Cyprus for investment into emerging
global opportunities. 3. The above results for the quarter ended September 30,
2006 were reviewed by the Audit Committee and were taken on record by the Board
of Directors in their meeting held on October 27, 2006,
KEY RATIOS
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
Debt Equity Ratio |
0.82 |
0.78 |
0.85 |
|
Long Term Debt Equity Ratio |
0.81 |
0.77 |
0.74 |
|
Current Ratio |
3.25 |
3.06 |
2.05 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
0.52 |
0.46 |
0.67 |
|
Inventory |
4.38 |
4.99 |
10.58 |
|
Debtors |
4.87 |
4.26 |
5.43 |
|
Interest Cover Ratio |
1.04 |
1.41 |
6.23 |
|
Operating Profit Margin (%) |
23.92 |
28.53 |
41.76 |
|
Profit Before Interest and Tax Margin (%) |
5.63 |
7.68 |
27.38 |
|
Cash Profit Margin (%) |
18.56 |
25.34 |
34.90 |
|
Adjusted Net Profit Margin (%) |
0.27 |
4.49 |
20.52 |
|
Return on Capital Employed (%) |
2.68 |
2.96 |
15.09 |
|
Return on Net Worth (%) |
0.23 |
3.08 |
20.93 |
LOCAL AGENCY FURTHER INFORMATION
History:
The
company was incorporated on 21.03.1983 at New Delhi in India having Company
Registration Number 15418.
The
company now shifted from 63, Ring Road, Lajpat Nagar - III, New Delhi - 110
024, India to 43A, Okhla Industrial Estate, New Delhi – 110 020, India.
Incorporated
in March 1983 as a private limited company and was converted into a public
limited liability company in September, 1996. It was promoted by Mr. Deepak
Puri and Mrs. Nita Puri. The company manufactures storage media for data
applications and audio/video applications. Today the company is India’s largest
and among the world three largest optical storage media manufactures.
The
company has established itself as a leading exporter of 5.25 floppy diskettes,
in technical collaboration with XYDEX Corporation, United States of America. It
has also entered into an agreement with Mag Media, IMTC and RES, all of
Germany, on a world-wide basis for the supply of its entire production of 3.5”
MFD of 1 – MB and 2 – MB capacity.
The
company also entered into R&D tie up with 4M Technologies. The R&D will
focus on developing newer, faster and more reliable CD-ROM products, improving
existing CD-ROM process to reduce manufacturing cost and developing new high density
storage formats for both digital versatile CD (DVD-R) and higher density DVD
formats.
The
company acquired Capco S.A. of Luxembourg for about Rs. 230.000 millions. In
December 2000, it has set up a subsidiary – Glyphics Media, which spearheaded
the company’s penetration into key North American markets. The company has
invested around $100 millions for the completion of its optical media project.
During
2001-02 CAPCO S.A. of Luxembourg ceased to be the subsidiary of the company.
The installed capacity of storage media (both audio and video) was increased to
891,320,000 nos.
During
the year 1998-99, there was an incidence of fire at one of the company's
facilities. Due to the presence of an
emergency and disaster management plan and adequate fire fighting and other
resources this fire was brought under control.
Due to efforts put in by the company's employees and continuous
implementation of the recovery plant, the facility restarted operations with a
minimum loss of production.
During
the year 2001-02 Capco SA of Luxembourg ceased to be subsidiary of the company.
The installed capacity of storage media (both audio & video) was increased
to 891320000 nos. The cumulative investment made by the company was Rs.18144.08
millions and in 2002-03 the company invested Rs.10617.94 millions which was
utilized to increase the manufacturing capacity from 891.00 millions to 1186
millions units per annum. It had also established facilities and infrastructure
for additional capacity expansion which the company is going to undertake in
the future and for de-bottlenecking of existing manufacturing facilities.
The company entered a global strategic tie-up
with Imitation Corporation, USA which results in Imitation Sourcing a
substantial part of their requirements of optical media from the company. The
deal worth in excess of USD 100 million per annum. Both the companies have also
agreed to float Joint Venture company of which 51% will be owned by Imitation
Corporation.
The
company has joined hands with the Indian institute of Technology (IIT) , Delhi
to work jointly in the frontier areas of thin film sputtering technology
suitable for optical data storage devices.
The
company has expanded the installed capacity of Storage Media during the FY
2004-05 by 548.000 millions and this expansion the total capacity of the
product has risen to 3612.500 millions (Nos.). Further the company has began
its production and shipment of Light Scribe – enabled media in collaboration
with Hewlett – Packard. During the year the company has established its
subsidiary in Germany with the objective of addressing high end niche markets.
The
company will invest US$ 105 million to increase its disk production capacity
form 2.4 billion to to over 2.8 billion deices annually, during 2005-06.
Operations:
Revenues for FY '06 stood at Rs.17026.01
million, profit before depreciation, interest and tax, but after prior-period
items stood at Rs.4142.62 million, and profit after tax was Rs.46.66 million.
Subsequent to the difficult market environment prevalent over the past two
years, the global optical storage media industry is now on a steady path to
recovery, driven by consolidation of capacity, continued growth in consumer
demand and signs of softening of prices for key inputs.
The Company witnessed a turnaround in the last two quarters of the FY '06 as it
continued its efforts to gradually revert to normal levels of operational &
financial performance. Continuing strong growth in demand for DVD's and a
stable market for CD's combined with consolidation helped create a more
favorable environment during the progress of the year.
Market environment and outlook:
Industry Outlook:
In 2006, Strategic Marketing Decisions (SMD) estimates that global demand for
CDR/RW will remain almost flat as compared to 2005, at 13 billion units, Where
as the European and US markets will show a marginal decline in demand, rapid
growth in the Asian, Latin American, Indian and Chinese markets will offset
this demand decline. In the near term, new corporate applications and emerging
segments like the printable media and Light Scribe will ensure steady growth in
the CDR/RW space.
Global CDR/RW supply continues to consolidate through capacity conversions and
closure of inefficient capacities. This is helping the CDR/RW demand-supply
balance to return to equilibrium, thereby providing a stimulus for firm CDR/RW
prices on the medium term.
DVDR demand is rapidly growing on a global basis, and is expected to touch 6.4
Billion in 2006, as compared to 3.9 Billion in 2005, an increase of 64%. This
demand growth is expected to continue over the next few years, until the next
generation formats (Blu-ray disk and HD - DVD) start to gait a mass market
acceptance.
Next generation optical media formats halve tire potential to provide a
price-value proposition to consumers which could be extremely difficult for
alternate technologies to meet. Over the long terra, these formats could evolve
to store 100GB of data at a price equivalent to current retail price of DVDR/RW
format. While BMD expects 2007 to be the first big year for blue laser based
technology, the race has already begun,
Market
development:
For the last few years, the Company has been evaluating various business
opportunities for diversification and broadening its product portfolio. With an
eye to expand the existing market, the Company has started focusing on
value-added products to drive an expansion in margins. As the Company sells
predominantly to OEM customers, who source their products on a global basis,
individual market changes have a lesser impact on the Company's operations. The
share of outsourced volume from an OEM customer has a greater impact on the
Company's operations and, hence the Company's focus is to increase the share of
a customer outsourcing its requirements.
In their coal of maintaining a first to market position the Company introduced
a number of new products during the year, including 16x DVD+/-R disks, 1x/2.4x
Dual Layer disks, 8x DVD +RW disks. These product introductions combined with
continuing growth in the `Wallet share' of existing customers, and new customer
acquisitions allowed the Company to increase it's market share significantly in
the DVDR area.
Over the past three years, the Company has invested significantly in its
R&D programs targeted at developing next generation formats in the optical
media space by leveraging its core skills in base material engineering, thin
film coating, precision sputtering arid deep UV mastering technologies.
Starting from the first quarter FY07, the Company playas to launch a series of
next generation formats, in conjugation with drive and recorder availability,
and expects to be first to market in a majority of these formats. The four
products which they believe will have a significant market potential in the
future are 3x DVDR Dual Layer, ND DVDR (recordable) and RE (re-writable), HD
DVD Dual layer, and Blu-ray Disk (BD)-R and RE.
New
projects:
During FY06, the Company spent Rs.3681 Million (USD 87 million) to expand
capacity to 2.8 billion units per annum. A majority of these investments were
made in the DVD format and in next generation technologies to maintain their
leading position in the marketplace.
Photovoltaic
(PV) Cell project:
In October 2005, the Company announced plans to enter the high-growth
Photovoltaic (PV) business. With an initial project cost of Rs.2600 Million
(USD 58 million), the Company is targeting a capacity of 80 MW by year 2007.
This project is on a fast track to implementation and will be executed in Miser
Baer Photo Voltaic Ltd., which has already been established and capitalized.
The contracts for supply of some equipment and technology for cell and module
making have already been executed. The company has also secured part of its
short-term requirements of raw materials and is working towards closing its
medium to long term sourcing agreements.
Subsidiary Companies:
During the financial year, two companies, Moser Baer
Photo Voltaic Limited and Moser Baer SEZ Developer Limited were incorporated as
the Company's 100% subsidiaries. While Miser Baer Photo Voltaic Limited has
been established with the objective to develop, manufacture arid market photo
voltaic cells, modules and systems, Moser Baer SEZ Developer Limited has been
set up with the objective to carry on the activity of establishing, developing,
maintaining and operating Special Economic Zones for non-conventional
energy.
(Further, the Company's thirst subsidiary, namely European Optic Media
Technology GmbH (Europtic) has been established in Germany with the objective
of establishing manufacturing facilities in Europe, to service the requirements
of their OEM, retail and enterprise customers.
As required under Section 212 of the Companies Act, 1956, the audited accounts
Maser Baer Photo Voltaic Limited for the period 7 December, 2005 to 31 March,
2006 and the audited accounts of European Optic Media Technology GmbH for the
financial year 2005-06 are annexed herewith along with the Auditors' Reports
thereon and the Directors' Reports thereto, together with a statement of the
Company's interest in the said subsidiary Companies.
The first financial year of Moser Baer SEZ Developer Limited, which was
incorporated on 20 February, 2006 and received its Certificate for Commencement
of Business on 25 April, 2006, will end on 31 March, 2007. Thus, its audited
accounts will be included in next year's Annual Report.
Foreign exchange earnings and
outgo:
Total foreign exchange earned comprising off FOB value of exports, services,
interest, insurance claim received and dividend received was Rs.14094.74
million, whereas total foreign, exchange used (comprising of CIF value of
imports, dividend remitted and other outgoings) was Rs.13790.15 million. For
and on behalf of the Board of Directors
MANAGEMENT DISCUSSION AND
ANALYSIS
Overview:
The year 2005-06 (FY06) has been one of challenge achievement and change. The
company emerged stronger from the difficult industry conditions prevalent over
the last 18 months, which led to a global consolidation of capacities.
Over the past year, the Company has focused its efforts to improve its
manufacturing and supply chain efficiencies, drive R&D and engineering
programs to improve the product and service offerings that they bring to
customers.
This enabled us to offer value added products to their increasing global
customer base of technology OEMs, achieve record level of product shipments,
surpass quality benchmarks and achieve a possible 'first to market' position in
the next generation global formats - the blue laser based Blu-ray disc (BD) or
High Density DVD (HD DVD). Over the next few yearns, they believe that the
company is wall positioned to further enhance their global leadership position
in Optical Media industry.
In line with a long term strategy of creating a multi business - technology led
trans national, the company announced plans to enter the global Photo Voltaic
(PV) industry. The new business has been identified as technology driven,
poised for extraordinary growth and leveraging the company's core strengths in
fine/wet chemical processing, thin film coating, mass manufacturing, and rapid
technology commercialization c& project execution. The PV business is
significantly less capital intensive compared to optical media business and
should contribute to improving overall returns on invested capital.
The company aims at emerging as a key player in this `environment friendly'
alternative energy technology, and to spur reduction of PV cell costs through
innovation in technology and manufacturing to emerge amongst the most efficient
PV cell manufacturers in the world.
The cornerstone for sustaining global leadership and success in the optical
media and PV business will be the company's ability to break barriers on the
operating and technology front.
Global Industry Developments:
Following the
difficult industry environment over the past 18 months which adversely impacted
the operating performance of manufacturers, the global optical storage media
industry started on a steady path to recovery in 2005-06, driven by global
consolidation of capacity, continued growth in consumer demand and signs of
softening of prices for key inputs.
Channel inventories depleted as the industry moved towards better demand supply
balance, accompanied by strong volume growth, with DVDR being the growth
leader. While capacity conversion resulted in firming of CDR prices inter in
the year, DVD prices started following the manufacturing cost curve as the
product attained maturity.
The price of polycarbonate (PC) remained a key factor in driving significant
increases in the input costs for the industry. A sharp rise in global PC prices
severely impacted industry's operating performance. The PC price curve started
to ease from the second half of 2005-06, which should positively influence the
industry in the near term.
The year 2005-06 saw DVDR/RW format emerge as a 'format of choice' for the
consumer, driven by increasing drive penetration and improving price-value
proposition, to grove to 3.0 billion disks in 2005, a 105% growth over the
previous year. Meanwhile global CDR/RW supply continues to consolidate through
capacity conversions and closure of inefficient capacities around the world.
This helping CDR/RW demand-supply balance return equilibrium with global demand
estimated to be 13.6 billion disks in 2005, according to Strategic Marketing
& Decisions (SMD) estimates.
SMID expects global demand for optical media to grow from 17 billion units per
annum in 2005 to 27 billion units per annum by 2006, driven by robust growth in
DVDR/RW formats and stability in CDR/RW. Companies should also start shipping
DD/HD DVD media during 2006.
Product-wise Analysis and
Outlook:
CDR/RW:
Global CDR/RW supply continues to consolidate through capacity conversions into
DVDR/RW and closure of inefficient capacities around the world. This is helping
CDR/RW demand-supply balance return to equilibrium, thereby providing a
stimulus for firm CDR/RW pricing environment in the medium term.
Strategic Marketing & Decisions (SMD) estimates global demand for CDR/RW
formats to remain around the level of 13 billion units per annum over the next
couple of years. Consumer demsnd for CDR/RW format continues to grow in As.an
and Middle Eastern markets. There are also certain emerging corporate
applications arid niche segments like the printable media and LightScribe,
which are seeing a rapid growth in the CDR/RW space. The legacy of CD-Audio
disc players and writers will also help extend the CDR/RW life cycle.
DVDR/RW:
DVDR/RW drives are fast becoming a part
of standard product offerings, increasing their penetration rates and growth in
the installed base of drives. As per SMD, DVD-enabled drive sales represented
nearly 75% of all optical drives sold in 2005 and the DVDR/RW writer base is
expanding at over 60% p.a. The growth is being driven by proliferation of new
drives and new users with CE devices (DVD VCR, Camcorder) becoming major
consumers of medla. SMD expects shifting consumer preferences, increasing drive
penetration and improving price value proposition to grow the demand for
DVDR/RW media to over 5 billion disks per annum in 2006 from 3.0 billion disks
in 2005, with 16x media emerging as the dominant variant.
Delayed launch of Blue-laser based formats (BID & HD DVD) should lead to a
larger than expected installed base of DVDR/RW drives and an extension in
lifecycle for DVD-formats. As DVDR/RW manufacturing technology matures and as
format writing speed stabilizes, the DVDR/RW pricing is expected to follow the
manufacturing cost curve in the medium term, which should further aid volume
growth.
Financial Highlights:
Gross revenue for FY 2006 at INR 17319.1 million is an increase of 28.0% over
FY 2005, representing the recovery in volumes and impact of expanded capacity
during the year.
EBITDA (including other income) at INR 4136.0 million grew by 5.6% over FY
2005.
Operating performance turnaround from Q2 of FY '06 as industry variables
started to improve and as company's various programmes on efficiency
improvement were implemented.
The company achieved a profit after tax (including deferred tax impacts) of INR
46.7 million in FY 2006.
Moser Baer - Developments FY
2005-06:
During the year, the company significantly enhanced its position in the global
optical media industry, and emerged against the three largest producers across
both the DVD and CD formats. The company now supplies to all the top twelve
leading technology OEMs in the world. The company has also strengthened its
position in the domestic-market by expanding its market reach and brand
awareness.
During the year, the company continued its efforts to gradually revert to
normal levels of operational & financial performance. The steady
improvement in market conditions and their increasing order books enabled us to
achieve record levels of optical media shipments in FY 2006.
Despite the short term turbulence of the past years, the company remains
positive on the long term potential of the optical media industry, the company expanded
its capacity from 2.4 billion units per annum to 2.8 billion units during the
year.
During 2005-06, DVDR/RW shipment volumes grew at a fast clip, while a sharp
recovery in GDR/RW shipments - in line with their expectations, particularly
during the second half of the year, attributed to a robust growth in optical
media shipments during the year. Overall shipment volumes rose 14%, with
DVDR/RW contributing to as a significant part of the increase.
The Indian market remains one of the fastest growing markets in the world.
During the year, the company continued its efforts to emerge as a dominant
player in this key market with its Moser Baer IRO range of products. The brand
has now grown to capture over 50% market share of the domestic branded market.
The company spends around 2.1% of its revenues on pure optical media research
and engineering. The multi-pronged approach to R&D at their world class
research labs at Noida and Greater Noida has enabled us to sustain their
competitive edge over the years.
The company continues to drive extensive cost reduction programs, with a focus
on DVD formats, resulting in increasing manufacturing efficiencies.
They have been able to research design arid co-develop equipment which improves
products yields, enabling us to re-set benchmarks for manufacturing costs and
efficiencies.
In a fast evolving market landscape and increasing competition, companies will
increasingly use technology to differentiate themselves and net only launch
innovative products, but also do so through more efficient manufacturing. The
company has embarked on a strategy to transform into a technology developer and
innovator. This should widen the gap between the company and second-tier
players. With proprietary technology and a possible first to market position in
the next generation formats, the company is well placed to further enhance its
global leadership.
Next Generation Formats:
With the phased introduction of high-definition television (HDTV) broadcasts
and increasing emergence of hardware supporting high-definition content, the
variables exist fair introduction of next generation of mass storage media. The
race is already on to successfully develop and commercialize the next
generation format in the industry, namely the BD or the HD DVD. SMD believes
that it is the Blue Laser technology (BD & HD DVD) that has the potential
of significantly mitigating the impact of possible cannibalization of optical
media demand by emerging alternate technologies in the long term. The next
generation optical media formats have the potential to provide a price-value
proposition to consumers which could be extremely difficult for alternate
technologies to meet. Over the long term these formats could evolve to store
100 GB of data at a price point equivalent to current retail price of DVDR/RW
format. While SMD expects 2007 to be the first big year for blue laser based
technology, the race has already begun.
Over the past three years the company has invested significantly in its
research and development programs targeted at developing next generation
formats in optical media space by leveraging its core skills in base material
engineering, thin film coating, precision sputtering and deep UV mastering
technologies. Starting frown 2Q FY '07, the company plans to launch a series of
next generation formats, in conjugation with drive and recorder availability,
and expects to be first to market in a majority of these formats. The four
products which they believe will have a significant market potential in the
future are DVDR Dual Layer, HD DVD (recordable) and RE (re-writable), HD DVD
Dual layer, and BD-R and RE.
The company has developed a unique technology specifically for advanced
generation of BD formats which will not only enable lower manufacturing costs,
but also allow the consumer greater ease of interchangeability of media across
different drives. This is expected to give us a significant competitive edge in
the next generation format race.
The company has also begun collaborative efforts in the Holographic technology
domain in order to work on media and related development of the future disk
with capacities up to 20OGB and beyond.
Optical Market in FY 2006:
CDR/RW in FY 2006:
Demand-supply equilibrium reached as capacity partly converted/Exited
Significant inventory depletion
Demand
continued to grow at low single digits worldwide
CDR pricing
stabilizes
Outlook:
Shipment volumes to remain strong
Contribution
should normalaize as entire inventory depleted
Pricing to
continue to firm
DVDR/RW
in FY 2006:
DVD demand-supply in balance
16x emerging as the format of choice
DVDR/RW prices are broadly tracking the manufacturing cost curve
Outlook:
DVDR/RW pricing to follow the
manufacturing cost curve
New
Business Initiative: Photovolatic (PV) Cell Project:
During the year, the company took a big stride forward in opening new vistas
far future growth with the entry in the emerging Photovoltaic industry. The
company, which plans to make an aggressive entry into the PV business by
manufacturing solar cells and modules, aims to emerge as one of the key
industry players and one of the most efficient manufacturers in the sunrise PV
industry.
This new field of business is synergistic with their existing businesses and
wild leverage on their core competencies in the areas of precision high
technology mass manufacturing, base metal engineering, thin-film coating and
project management.
Globally, energy is fast emerging as a critical issue, especially as existing
power generation options have limitations in terms of growth potential and
long-term sustenance. With the Sun supplying 10,000 tunes the amount of energy
needed every year by Earth, and with technological breakthroughs fast lowering
harnessing and distribution costs, solar power is fast emerging as the most
viable and eco-friendly power generation option for tomorrow - with no moving
parts, no noise and zero emissions.
The PV space is expected to grow five-told to a global market size of $40
billion by Year 2010. Also, the cost reduction potential of PV promises to make
it competitive with grid electricity over the years, which could significantly
increase its applications and growth potential.
As part of its strategy in the new business, the company is targeting the two
segments in PV value chain that are most attractive from a synergy standpoint -
solar cells and modules, It's also leveraging existing core competencies and
R&D to develop cutting edge manufacturing efficiencies and identify and
participate in emerging technologies to establish an early mover advantage and
sustainable competitive edge.
The company is targeting a capacity of 80 MW by Year 2007 with an initial
project cost of INR 2000 million ($68 million). The project is on a fast track
to implementation and will be executed in Moser Baer & Photo Voltaic Ltd.,
which has already been established and capitalizad. The contracts for supply of
equipment and technology for cell and module making have already been executed.
The company has also secured part of its short terra requirements of raw
materials and is working towards closing medium to long term sourcing
agreements. The company plans to start commercial production by 30 FY
2007.
The PV space presents the company with an exciting growth opportunity. Also,
since the business is significantly less capital-intensive than the company's
existing business, it is expected to noticeably improve the overall return on
invested capital.
SWOT:
Strengths:
Integrated manufacturing allowing cost
efficiencies and enhanced speed to market.
Lower capital investment, manpower and overhead costs allow cost
leadership.
Strong focus on R&D and engineering to constantly innovate products and
reduce costs.
Committed shareholders add strength, longevity and sustainability to future
plans.
Strong project management skills and execution and mass manufacturing
expertise.
Well established logistics and supply chain management skills.
Evolving into
a multiple technology business transnational.
Weaknesses:
Need to scale up operations to meet exponential growth opportunities.
Exposed to commodity cycles, especially in the short term.
Opportunities:
Robust
growth in DVDR market:
With existing top-tier customer tease and efficient in-house technology, the
company is well positioned to increase market share.
Domestic
market:
India is one of the fastest growing markets The company is well positioned to
dominate this captive market.
Emerging
Technology:
The Company has invested significantly in its research and development programs
targeted at next generation formats to be first to market in a majority of
these formats.
Solar
Photovoltaic business:
The Company is leveraging upon existing core competencies and R&D to
develop cutting edge manufacturing efficiencies and identify and participate in
emerging technologies to establish an early mover advantage and sustainable
competitive edge in PV space.
Threats:
Emerging technologies:
In a dynamic technology environment, the Company's business could be threatened
from more efficient emerging technologies. A growing drive installed base,
specific applications and an un-matched price value proposition will ensure
continued growth of optical media. The company is all set to capture the
imminent growth in next generation formats through its R&D and product
develop merit efforts. Also, an early mover advantage in the fast growing
global PV business should provide further momentum to growth.
Anti-dumping
and anti-subsidy levies:
The Company derives a significant part of its revenues from international
markets. These have seen a growing protectionist attitude and a tendency by
some local governments to use anti-dumping and trade protection tools to
provide protection to local businesses. However, the Company continues to keep
a close watch on this front and take necessary steps to minimize any
fallout.
Fail
in product prices:
As products move into the mature phase in their life-cycle, they start to
emulate commodity-type characteristics. Also, as the industry is characterized
by high volumes, large capacities and investments, a sharp reduction in product
pricing can impact performance. Pricing could fall due to oversupply, low
demand and cost reduction due to reduction in input costs or setting up of
capacities in low-cost regions.
Sharp
increase in input costs:
The key inputs for optical media and PV cell business are Polycarbonate and
Polysilicon respectively, both of which are commodities. Any sharp increase in
prices of these commodities or demand-supply imbalances could adversely impact
business. The company is working on strategic sourcing agreements for critical
raw materials, and this will help ease the impact of any pricing
volatility.
Change
in Government policies/subsidization programs:
Worldwide, government policies and incentives have provided impetus to the
tremendous growth of PV industry globally. Any change in these policies could
impact the potential growth of this business. Given the rising global concern
for alternate and environment friendly source of energy, PV is being recognized
as a viable alternative, globally.
Short term:
The Company's near-term strategy is to leverage its world class manufacturing
base, core competencies and R&D to develop cutting edge manufacturing
efficiencies and identify and participate in multiple emerging technologies to
establish an early mover advantage and sustainable competitive advantage in
next generation formats for optical media and the Photo Voltaic business,
Medium
term:
Moser Baer believes that in the medium term, the optical storage media industry
offers sufficient growth opportunity with relatively low risks and high returns
on invested capital, driven by next generation formats.
The company's aim is to be amongst the glob leaders in technology evolution in
the Photo Voltaic business and to relentlessly drive down costs to establish
itself as a leading highly efficient manufacturer in the global photovoltaic
industry.
Long
term:
Long term strategy of the company is to be amongst the worlds leading
technology manufacturing companies by continuing to leverage upon competencies
in base metal engineering, thin film coating, rapid technology
commercialization and efficient asset creation. The company wi continue to
evaluate and grow business having high growth potential, strong technology
barrier and high return on capital employed.
Overview:
The financial statements have been prepared in compliance with the requirements
of the Companies Act, 1956, and Accounting Standards in India. Their management
accepts responsibility for the integrity and objectivity of these financial
statements, as well as for various estimates and judgments used therein. The
estimates and judgments relating to the financial statements have been made on
a prudent and reasonable basis, in order that the financial statements reflect
in a true and fair manner the form and substance of transactions and reasonably
present their state of affairs and profits for the year.
On September 28, 2005 Woodgreen Investment Ltd. (WIL) did not exercise their
option to convert at the exercise price of INR 336/-, 5,400,000 Share Warrants
issued to them on a preferential basis by the Company pursuant to an agreement
dated March 25, 2004. The upfront money of INR 181.44 million, received against
these Share Warrants has been forfeited and accordingly taken to 'Reserves and
Surplus' as capital reserve.
INDUSTRY RISK MANAGEMENT:
The company operates in an industry where technology towards trends are
constantly changing and evolving which may jeopardize future growth.
The company, however, faces no immediate threat from the dynamic environment in
which it operates. On the contrary, it stands to benefit from the current
growth trends in the DVDR format.
As consumption evolves from analogue to digital technology, if is prompting
legacy recordings to migrate to new media.
Additionally, the company also entered the exciting global photovoltaic
industry which is growing at a rapid pace. This not only mitigates the risk of
exposure to a single industry, but as this industry is significantly less
capital intensive than optical media industry, it is expected to improve the
overall returns on invested capital.
Business:
The
company is engaged in the business as Manufacturer and Exporter of CDR, CDRW,
DVDR, DVDRW, Micro Flooy Diskettes, Audio-Video Tape under the brand ‘Moser
Baer’.
AS PER WEBSITE
Press
Release:
Moser Baer launches next generation
format
Tuesday,
July 25, 2006
The
first company in the world to start volume shipments of HD DVD-R
New Delhi, 25 July 2006: Moser Baer
today announced that it has begun shipping HD DVD-R (recordable), a next
generation format, to its global OEMs customers. The HD DVD-R will have a
capacity of 15 GB and offers more than three times the data storage capacity of
standard DVD media. HD DVD offers an ideal solution for reliable business
backup, including medical and government imaging, photography, video graphy, as
well as high definition video recording.
According to Ratul Puri, executive
director, Moser Baer, “The world is moving towards High Definition content.
This is a significant technology shift in the global optical media industry and
will radically change the consumer’s viewing experience. According to the US
based Strategic Marketing and Decisions, the demand for the next generation
high density formats is expected at 1.5 billion discs over the next three
years. This represents an exciting opportunity for us, as Moser Baer now has
the first mover advantage with this launch.”
In a fast evolving market landscape and
increasing competition, companies are increasingly using technology to
differentiate themselves. Moser Baer has embarked on a strategy to transform
into a technology developer and innovator from a technology recipient. Comments
Giriraj Nyati, VP R&D and Engineering, “This is a significant landmark for
us. And they are very proud that an Indian company has emerged in a strong
leadership position in the next generation optical media space and current
launch is the first in a series of many such launches expected throughout the
year. This reaffirms their technology leadership position along with their
manufacturing leadership position.”
The intensive R&D thrust will help
us to further consolidate their global leadership position in the optical media
space.
The company continues to leverage its
core skills in base material engineering, thin film coating, precision
sputtering and deep UV mastering technologies. Starting from the current
quarter and in conjugation with drive and recorder availability, the company
expects to be first to market in a majority of the next generation formats. The
four products which the company believes will have a significant market
potential in the future are DVDR Dual Layer, HD DVD-R (recordable) and RW
(re-writable), HD DVD Dual layer, and BD-R and RE.
About HD DVD
The HD DVD format supports a wide
variety of resolutions, from low-resolution CIF and SDTV up to HDTV formats
such as 720p, 1080i and 1080p. The HD DVD format is promoted by Toshiba, NEC,
Sanyo, Microsoft, and Intel, among others. In terms of major studios, HD DVD is
currently exclusively backed by Universal Studios, and is nonexclusively backed
by Paramount Pictures and Warner Bros., Studio Canal, and The Weinstein
Company.
About Moser Baer India Ltd
Moser Baer India Ltd, headquartered in
New Delhi, was established in 1983 and is the second largest manufacturer of
optical media disc in the world. It continues to develop cutting-edge technologies
for recordable optical media, constantly innovating and introducing new
products and processes. An emphasis on high-quality products and services has
enabled Moser Baer to emerge as one of India’s leading technology companies
with a nearly 18% share of the global recordable optical media market. The
company employs over 7,000 people and has multiple manufacturing facilities in
the suburbs of New Delhi,
REVIEW OF OPERATIONS
Demand and Pricing:
The global optical storage media
industry is now on a steady path to recovery, driven by consolidation of
capacity, continued growth in consumer demand and signs of softening of prices
for key inputs. The company further consolidated its position and according to
Techno System and Research (TSR), Japan, has emerged as the second largest
manufacturer of optical storage media in the world.
The company continues its efforts to
gradually revert to normal levels of operational & financial performance,
as reflected in a profit before tax of INR 67.2 million in 1QFY 2007 against a
loss of INR 138.7 million in 1QFY 2006. Lower sales from inventories and the
traditional summer demand slackness are the reasons for a 15% reduction in
shipment volumes during the quarter on a sequential basis. However, improved
products mix –with normalization of CDR/RW sales and increase in DVDR/RW
shipments – has led to a 3% increase in the optical media ASP, helping improve
operating parameters during the quarter.
“A steady improvement in market
variables continues. The recovery in CDR/RW media market pricing since last
quarter is a positive, and sustainable. The other positive during the quarter
is a normalization of revenue mix. They expect the trend to start reverting
back to normal operating and financial levels in the medium term driven by
increasing DVDR/RW contribution, improving CDR/RW pricing, rising production
efficiencies and softening of input costs.” Said Mr. Ratul Puri, Executive
Director, Moser Baer India Limited, said.
Costs:
The
softening of market purchase prices of PC (poly carbonate) continued during the
quarter – which is another major positive factor for the industry. While this
did not impact the quarter under review, it will be a major positive influencer
of their margins. The company continues to drive extensive cost reduction
programs, with a focus on DVD formats, resulting in increasing manufacturing
efficiencies. This has ensured margin stability on DVDR/RW formats despite a
pressure on pricing. They have been able to research, design and co-develop
equipment which improves process yields, enabling us to re-set internal
benchmarks for production cost reduction.
Future trends
The trend of gradual recovery and
improving industry conditions should continue into the current year. While
CDR/RW pricing should remain firm in the medium term, DVDR/RW prices are
expected to continue to follow its cost curve, enabling us to maintain healthy
margins in the optical media business. The revenue share of higher margin
DVDR/RW formats is expected to further rise to a target of 60% by 4QFY07,
thereby improving operating performance.
Moser Baer emerges as the winner of the
'Golden Peacock Environment Management Award
Friday, June 17, 2005
New
Delhi, June 17, 2005: After receiving a flurry of prestigious awards in the
recent past, Moser Baer India Ltd., India's largest and world's third largest
manufacturer of optical media storage, emerged yet again as the winner and
brought home the World Environment Foundation 'Golden Peacock Environment
Management Award' for the year 2005. The award was collected by Mr. S.
Rajalingham , Head of the second largest optical media plant of Moser Baer
Moser Baer came on top on all the
evaluation parameters, which included Eco-Innovation, Preservation of Natural
Resources, Eco-habitation, Competitiveness in Environment Management and
Excellence in Environment Protection.
The award was presented at a ceremony
held in the serene locales of Palampur. Also present at the ceremony were Dr
Olla Ullsten, former Prime Minister of Sweden, Dr. Mahadev Mehra, President,
World Council for Corporate Governance, Justice MN Venkatchailah, former Chief
Justice of India, Smt Vidhya Strokes, Power Minister, HP and Shri Shanta Kumar,
former Chief Minister, HP
Speaking on the occasion, Mr.
Rajalingham said, "it is indeed a proud moment for Moser Baer and me, as I
am personally very proud of being a part of Moser Baer, and thereby a
contributing member for the preservation of their environment, through Moser
Baer.
Moser Baer has not only set high-quality standards for its products, but is
equally conscious about issues like environment, health and safety. Receiving
this award is not only an acknowledgement of their efforts, but also motivates
us to work even harder and help their environment."
Moser Baer is the first company in
India to receive Phytosanitary certificate with permanent code number IN-001-HT
for elimination of methyl bromide and development of in-house heat treatment
process, recognized by Ministry of Forest & Environment Govt. of India and
IPPC Rome. Also, Sony Corporation Japan has announced Moser Baer with a Green
Partner Certification for the non-use of banned substances in product and
packing material.
ABOUT MOSER BAER
Moser Baer is a world
leader in the development and manufacture of removable data storage media.
Incorporated in 1983, the company is today one of India's leading technology
companies and ranks among the top three optical storage media manufacturers in
the world. Headquartered in New Delhi, India, it has a broad and robust product
range of floppy disks, compact discs (CDs) and digital versatile discs (DVDs).
A pioneer among globalizing Indian
firms, Moser Baer has a presence in over 82 countries, serviced through six
marketing offices in India, the US and Europe, and enjoys strong tie-ups with
all major global technology brands. Simultaneously, with the launch of the
'moserbaer PRO' label in India, the company has emerged as the preferred choice
in this burgeoning captive market. The result: Strong growth—with revenues
growing at a five-year CAGR of over 42 per cent.
It is this focus on building relationships responsibly that places Moser Baer
at the forefront of digital media technology.
History
Spiralling Growth
A typical CD has a unique spiral track of data, which, if
straightened, would be around 5 km long. It takes a single-minded, precise and
persistent approach to lay such a path. At Moser Baer, their spiralling growth
is a result of the same meticulous approach we use to make their media, applied
to running their company.
The company was founded in New Delhi in 1983 with a clear vision—
to operate in products with high entry barriers, from the technology as well as
capital point of view. Given the fact that high obsolescence usually goes hand
in hand with high technology, the risk and reward equation had to make sense.
It started as a Time Recorder unit in technical collaboration with Maruzen
Corporation, Japan and Moser Baer Sumiswald, Switzerland.
However, it was in 1986 that Moser Baer found its true calling.
This was the time when the data storage field—the marvel of creating a memory
second only to the human brain out of some plastic, specialty chemicals and
dyes— caught the attention of an engineer with a masters degree in mechanical
engineering from the Imperial College, London. So what if this meant breaking
into what was till then the exclusive preserve of Japanese and Taiwanese
manufacturers, questioning the paradigm that no Indian manufacturer could be
competitive in the global space and fighting the image that India was a country
that borrowed technology and did not create it? Such challenges only further
inspired Moser Baer founder and managing director Deepak Puri to take the
company to the forefront of the optical media industry.
Undertaking its first and only diversification into the data
storage industry, Moser Baer initially manufactured 5.25" Floppy
Diskettes, graduating to 3.5" Micro Floppy Diskettes (MFD) in 1993. Today,
Moser Baer is the world's fifth-largest manufacturer of MFDs. Its unique strength
in diskette manufacturing comes from products conforming to stringent
international quality standards with a cost-effectiveness that few can match.
In 1999, Moser Baer spread its wings into Recordable Optical
Media, setting up a 150-million unit capacity plant to manufacture Recordable
Compact Disks (CD-Rs) and Recordable Digital Versatile Disks (DVD-Rs). The
strategy for the optical media project was identical to what had successfully
been implemented in the diskette business—creating a facility that matched global
standards in terms of size, technology, quality, product flexibility and
process integration. The company is today the only large Indian manufacturer of
magnetic and optical media data storage products, exporting approximately 90%
of its production.
Since inception, Moser Baer has always endeavored to create its
space in the international market, something that very few Indian manufacturers
have been able to achieve. Aiding the company in its efforts has been a
carefully-planned and sustainable model—low costs, high margins, high profits,
reinvestment and capacity growth. Along the way, deep relationships have been
forged with leading OEMs, with the result that today there are hardly any
players in the field that Moser Baer is not associated with.
Milestones
|
1983 |
Year of Incorporation |
|
1985 |
Production of 8.0"/5.25" disks
commences |
|
1987 |
Production of 3.5" disks commences |
|
1998 |
Moser Baer India gets ISO 9002 certification |
|
1999 |
Production of CD-Rs commences |
|
2000 |
Production of CD-RWs commences |
|
2002 |
Production of cake and jewel boxes begins |
|
2003 |
Entry into DVD-R formats |
|
2004 |
Technology license agreement with Hewlett-Packard
to manufacture optical media using 'Lightscribe' technology |
|
2005 |
ISO 14001 & OHSAS 18001 certification for
Moser Baer plants. |
About Moser Baer
India-based company with
nearly two decades' experience in removable data storage
Among the top three media
manufacturers in the world #1 in the fast-growing India market
Lowest-cost manufacturer of
optical media in the world
R&D-focused company
Focused on optical and
magnetic data storage media
OEM supplier to all the 12
leading storage media brands in the world
Revenue growing at 5-year
CAGR of 42%
Products
Optical Storage Media: Recordable Compact Discs (CD-R), Rewritable Compact
Discs (CD-RW), Pre-recorded CD/DVD, Digital Versatile Disks (DVD-R) and
Rewritable Digital Versatile Disks (DVD-RW), LightScribe enabled media.
At Moserbaer, the means are
as important as the end. It is not just reaching the destination that matters.
It is equally important that the route they take to success is correct.
Values
Meticulous: To persevere till
they reach quality perfection, and beyond
Open: To encourage and be
accessible to new ideas and feedback
Selfless: To give back to
society
Ethical: To be honest and
ethical in their business
Responsible: To fulfill their
commitments on time, every time
Corporate Objectives
A commitment to efficient
manufacturing that has led to the lowest production costs in the world
A strong R&D focus that
has helped develop innovative products on a continuing basis
The highest quality standards
that have consistently delivered world-class products
A strong customer focus that
has resulted in high customer retention and acquisition
A marketing focus that has
kept products contemporary and relevant to emerging needs
A systems-driven approach
that has stimulated growth in keeping with institutionalized
protocols and practices
Financial discipline that has
led to enhanced shareholder value
A professional approach that
translates knowledge and data into better interpretation of market needs
A proactive approach to
current and future challenges
Quality
Quality for us is not a feat
- it is a habit.
At
Moser Baer they believe that their consistent ability to deliver quality
products has been their key differentiator. They have instituted a continuous
quality improvement culture and a strong systems driven focus to ensure that
the quality of their products consistently meet or exceed international
benchmarks. The company's processes are certified under ISO 9001:2000 Quality
Management System Standard, ISO 14001:2004 Environment Management System
Standard and OHSAS 18001:1999 for Occupational Health and Safety Management
System Standard.
They
define quality as 100% conformance to customer requirement. It's like an
attitude with us, a part of every process. This is because they realize that
even one in a million error prone disc can spell disaster for the user. So,
nothing but 'zero defect' manufacturing is what they target for their products.
Strictly
dust free working environments in all of their six state-of-the-art climate
controlled plants, the top of line machinery & equipment and benchmarked
processes & practices assist us in giving quality products consistently. A
strong use of statistical techniques and in-house developed process control methods
has enabled defects to approach six sigma levels.
On
average, they invest close to 50 man-hours per year in quality training across
all manufacturing disciplines to create a high quality conscious culture. Their
quality strategy is not control oriented, but preventive in nature thereby
enabling us to minimize the cost of quality while simultaneously achieving one
of the lowest defect rates within the industry.
Excellence
Moser
Baer since inception has consistently strengthened its competitiveness by
enhancing capacity at lower incremental expenditure, declining conversion cost,
progressive vertical integration and improving material efficiency. As a result
they have emerged as one of the lowest cost manufacturers of optical media in
the world.
What
makes us who they are? A fierce commitment to quality, a dogged determination
to take the 'Made in India' Label to the world, constant efforts to offer the
best to their customers, their efficiency in manufacturing, their agile change
management ability or their love for innovation. It is all of the above and
much more that helps set Moser Baer apart. They believe it is their endeavor to
outpace change on the basis of the unique result-oriented systems they have in
place.
Efficient
Manufacturing: The capabilities of their engineering and design, production
lines, processes and manufacturing facilities allow us to move quickly from the
concept stage to the finished product.
Speed
to Market: Using their expertise they develop new technologies rapidly that's
to their decentralized yet cohesive organizational structure that makes it easy
to take decisions.
Strong
Research and Engineering Base: Whether it is producing products with the help
of proprietary technologies or developing products that glove-fit their customers'
needs, their R&D provides the needed backbone.
Providing
High Quality at Optimal Cost: At any point of time, you will find several QICR
- quality implementation and cost reduction - programs running simultaneously
across their operations.
Customer
Focus: As a supplier they aim to be both flexible and innovative when it comes
to their customers. They integrate and align theirselves with their customers
to understand their requirements and develop programs that exceed expectations.
Supply
Chain and Logistics: They were the first Indian company to have dedicated
export trains, the first to push for a round-the-clock customs clearance
facility at ICDs and one of the few to provide total logistics solutions to
their customers. They have even built their own in-house software for managing
inbound and outbound shipments to help track documents and containers
instantly.
People
Skills: The power of their intellectual capital is reflected in process
efficiencies, reengineered equipment, enhanced productivity, low manufacturing
cost and new product launches amongst others.
Change
Managers: With their systems approach to forecasting business cycles, however,
they have been able to employ their capital at the right time for the right
product in the right market.
Marketing
Strategy: Their global marketing offices, subsidiaries and logistical and
distribution centers make it possible for us to react quickly to customer
requirements. In India, they launched the Moser Baer brand of storage media and
are now enjoying a 25 per cent domestic market share in high value branded
segments.
Financial
Strategy: Their prudent mix of equity, debt and internal accruals to finance
their expansion plans has yielded significant returns and has helped us achieve
a conservative risk
to
cost ratio.
European
Optic Media Techonology
European
Optic Media Techonology Gmbh (Europtic) incorporated in the city of Erfurt,
state of Thuringen, Germany in September 2002, is a 100% subsidiary of Moser
Baer India Limited. The subsidiary has been set up to provide thrust to the
global marketing position of Moser Baer.
The
objective of Europtic is to set up green field manufacturing facility to
produce optical media of various types. The Company has been established with
the objective of adressing high-end niche markets. It will establish
manufacturing facilities in Europe that will create research and development,
marketing, distribution and logistics capabilities to service the requirements
of their OEM, and retail and enterprise customers.
The
company is under the visionary leadership of Mr. V.J Prakash, Managing Director
and Rainer Schuett, Chief Operating Officer.
Moser
Baer Photovoltaic
Moser
Baer Photovoltaic incorporated in New Delhi, India is a subsidiary of Moser
Baer India Ltd that caters to the photovoltaic (PV) business.
The
company plans to make the solar power generation business by manufacturing
solar cells and modules, is targeting an annual capacity of 80 MW in Phase I.
The initial project cost is estimated to be Rs 2600 millions ($58 million),
with Moser Baer investing Rs 1120 millions ($25 million) in the new venture.
Moser
Baer SEZ
Moser
Baer SEZ is a public limited subsidiary, incorporated by Moser Baer India Ltd
in February 2006. The subsidiary will function as a “developer” of special
economic zones in India.
Moser
Baer has made a foray into photovoltaic business in October 2005 and planned to
make the solar power generation business by manufacturing solar cells and
modules. The “developer” status provides convenience and advantages to the
company.
The
prospective units expected to settle in this SEZ would be companies upstream
and downstream in the business.
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. 44.24 |
|
UK
Pound |
1 |
Rs. 86.95 |
|
Euro |
1 |
Rs. 57.33 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
8 |
|
OPERATING SCALE |
1~10 |
9 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
8 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
6 |
|
--LEVERAGE |
1~10 |
6 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
8 |
|
--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 |
|
67 |
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 |