MIRA INFORM REPORT

Report Date :

28.04.2008

IDENTIFICATION DETAILS

Name :	AMTEK AUTO LIMITED
Registered Office :	Plot No.16, Industrial Area, Rozka Meo, P.O. Sohana, Guragaon – 122103, Haryana
Country :	India
Financials (as on) :	30.06.2007
Date of Incorporation :	04.08.1988
Com. Reg. No.:	030333
CIN No.: [Company Identification No.]	L27230HR1988PLC030333
TAN No.: [Tax Deduction & Collection Account No.]	RTKA02129B
PAN No.: [Permanent Account No.]	AAFFA6185K
Legal Form :	Subject is a public limited liability company. The company’s shares are listed on the Stock Exchanges.
Line of Business :	Manufacturer and Seller of Auto Components, Forging and Scrap Sales.

RATING & COMMENTS

MIRA’s Rating :

Aa

RATING		STATUS	PROPOSED CREDIT LINE
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

Maximum Credit Limit :	USD 70000000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well-established and reputed company and a part of Amtek Group. The company is progressing well. Directors are reported as experienced and respectable businessmen. Trade relations are reported as fair. Business is active. Payments are usually correct and as per commitments. Fundamentals are strong and healthy. The company can be considered normal for business dealings at usual trade terms and conditions. The company can be regarded as a promising business partner in a medium to long run.

LOCATIONS

Registered Office/ Factory 1:	Plot No.16, Industrial Area, Rozka Meo, P.O. Sohana, Guragaon – 122103, Haryana, India
Tel. No.:	91-124-2662456 / 26362140 / 2662140
Fax No.:	91-124-26362454 /2662454
E-Mail :	aal1@satyam.net.in, topcorp@rediffmail.com , aall@amtek.com topcorp@rediffmail.com
Website :	http://www.amtek-auto.com
Head Office :	3, L.S.C., Pamposh Enclave, Greater Kailash, Part I, New Delhi-110048, Delhi, India
Tel. No.:	91-11-42344444/ 26088219/ 26061767
Fax No.:	91-11-42344400
E-Mail :	info@amtek.com sandeep.chawla@amtek.com
Website :	http://www.amtek-auto.com
Administrative Office:	Plot No. 53, Sector -3, Industrial Model Township , HSIDC, Manesar , Gurgaon, Haryana, India
Tel No.:	91-124-2290748
Fax No.:	91-124-2290983
Corporate Office:	3, Local Shopping Centre, Pamposh Enclave, G.K.-I, New Delhi-110 048, India
Tel. No.:	91-11-42344444
Fax No.:	91-11-42344000
E-Mail :	info@amlek.com
Websites:	http//:www.amtek.com
Factory 2:	Begumpur Khotaula, P.O. Khandsa, District, Gurgaon, Haryana , India
Tel. No.:	91-124-2373412
Fax No.:	91-124-2373408
E-Mail :	amtekunit2@amtek.com
Factory 3:	Vill. Mohammadpur, Jharsa, District, Gurgaon, Haryana, India
Tel. No.:	91-124-2372152
Fax No.:	91-124-2373410
Factory 4:	Plot No. 7/ 8, Hirehalli Industrial Area, Hirehalli, District Tumkur, Karnataka, India
Tel. No.:	91-22-108161 43692, 43686
E-Mail :	amtekbang@amtek.com
Factory 5:	Plot No.1, Sector-ll, New Industrial Area, District, Raisen, Mandideep-462046, India
Tel. No.:	91-22-507053
Factory 6:	Plot No. 1, Industrial Area, Dharuhera, Rewari, Haryana, India
Factory 7:	Plot No. 53, Sector III, Industrial Area, IMT Manesar, Gurgaon, Haryana, India
Factory 8:	Gat No. 1074-1085, Sanaswadi Shikrapur Chakan Road, Taluka Shirpur. Pune, Maharashtra, India
Factory 9:	Nalagarh. District Solan IH.P.l, India
Factory 10:	Ranjangaon, Pune, Maharashtra, India
Factory 11:	Plot No. 20. Phase-l, Industrial Area, Dharuhera, Rewari, Haryana, India

DIRECTORS

Name :	Mr. Arvind Dham
Designation :	Chairman
Qualification :	B. Architect, MBA
Name :	Mr. D S Malik
Designation :	Managing Director
Name :	Mr. B Lugani
Designation :	Director
Name :	Mr. Rajiv Thakur
Designation :	Director
Name :	Mr. Sanjay Chhabra
Designation :	Director
Name :	Mr. M Chittaranjan Kumar
Designation :	Nominee IDBI
Name :	Mr. K Vaidyalingam
Designation :	Nominee (LIC)
Name :	Mr. John Ernest Flintham
Designation :	Director

KEY EXECUTIVES

Name :	Mr. Rajeev Raj Kumar
Designation :	Company Secretary
Name :	Mr. Sandeep Chawla
Designation :	General Manager (Marketing)
Name :	Mr. Ashwini Kumar Syal
Designation :	Vice President - Marketing

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

(As on 30.06.2007):-

Names of Shareholders	No. of Shares	Percentage of Holding
Indian
Individuals / Hindu Undivided Family	2797240	2.139
Bodies Corporate	38493400	29.431
Institutions
Mutual Funds / UTI	19790594	15.132
Financial Institutions / Banks	890476	0.681
Foreign Institutional Investors	59128422	45.209
Non Institutions
Bodies Corporate	3290934	2.516
Individual Shareholders holding nominal Share Capital upto Rs. 0.100 million	2378865	1.819
Individual Shareholders holding nominal Share Capital in excess of Rs. 0.100 million	1028900	0.787
Any Others
Trusts	350	0.000
Clearing Member	185511	0.142
NRI Individuals	109344	0.084
HUF	58341	0.045
Foreign Corporate Bodies	2433991	1.861
Shares held by custodians and against which depository Receipts have been issued	204000	0.156
Total	130790368	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer and Seller of Auto Components, Forging and Scrap Sales.

Products :

Generic Name/s of Principal Products/Services of the company are/is as under :

Item Code No.	Product Description
8409	Connecting rods assembly / piston assembly
8483	Case component assemblies
7326	Forging

Exports :

Countries :

· Japan,

· France

· Argentina

PRODUCTION STATUS(As on 30.06.2007):-

Particulars	Unit	Installed Capacity	Actual Production
Machined Auto Components	Nos (in lacs)	280.00	166.42
Forgings	TPA	115000.00	59440.00
Aluminium Castings	TPA	20000.00	2.25

GENERAL INFORMATION

Suppliers:

· Super Sharp Industries

· Prolific Technologies

· Gaugeman Industries

· Rajesh Plastic Industries

· R.C Industries

· M.D Engg.

· Ambica Machinery Works

· Superceram

· Gaurav Industries

· Tirupati Engg Works

· Bhagwati Packers

Customers :

· Maruti Suzuki

· John Deere

· TVS Suzuki

· JCB

· JBML

· Case New Holland

· GE

· Hero Honda

· Hindustan Motors

· Mahindra and Mahindra

· Tata Motors

· Sanden Corp.

· LML Limited

· Eicher Tractors

· Honda Scooters

· Yamaha motors

· Bajaj Auto.

No. of Employees :

4000

Bankers:

· Corporation Bank

· Andhra Bank

· Indian Overseas Bank

SECURED LOANS	30.06.2007	30.06.2006
	(Rs. in millions)
Bank Borrowings	418.594	442.897
Rupee Term Loan	364.982	511.000
13% Non – Convertibles Debentures	236.694	393.339
Total	1020.270	1347.236
UNSECURED LOANS	30.06.2007	30.06.2006
	(Rs. in millions)
0.5% Foreign Currency Convertible Bonds 2010	1334.351	3360.898
0.0% Foreign Currency Convertible Bonds 2011	10145.000	11467.500
Others	235.765	250.000
Total	11715.116	15078.398
Note: CD'S/Term debts from Financial Institutions/Banks are secured by way of first mortgage of company's all immovable properties ranking pari passu interse and hypothecation of whole of the company's movable properties including plant and machinery, machinery spares, tools and accessories (save and except book debts) present and future, subject to prior charges created/ to be created in favour of the company's bankers on inventories book debts and other specified movables for securing the borrowing for working capital requirements and loans under EFS/ECS/HP/Lease schemes if any are secured by way of charge on the specified assets financed under the scheme.

Banking Relations :

Good

Auditors :

Name :

Manoj Mohan and Associates

Chartered Accountants

Address :

Noida, Uttar Pradesh, India

Memberships :

ACMA

Group Companies :

· Amtek Auto Limited

· Ahmednagar Forgings Limited

· Amtek India Limited

· Amtek Siccardi India Limited

· Amtek Tekfor Automotives Limited

· Amtek Gears Inc.

· Amtek Aluminium Castings UK Limited

· Amtek Castings India Limited

· Benda Amtek Limited

· GWK Amtek Limited

· Midwest Manufacturing Company

· Sigmacast Iron Limited

· Zelter GmbH

Associates/Subsidiaries:

· Ahmednagar Forgings Limited,

· Kuruli, Pune, Maharashtra

· Smith Jones Inc, (IOWA, USA)

· Amtek Crankshafts India Limited (Formerly Amtek Siccardi India Limited )

· Amtek Ring Gears Limited (Formerly Benda Amtek Limited )

· Smith Jones Inc. USA

· Amtek Investment (UK) Limited

· Amtek Investment US (1) Inc.

· Amtek Duetshland Gmbh

· Amtek Tekfor Automotive India Limited

· MPT Amtek Automotive Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
225000000	Equity Shares	Rs.2/- each	Rs.450.000 millions
3500000	Preferences Shares	Rs. 100/- each	Rs.350.000 millions
		Total	Rs.800.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
130790368	Equity Shares	Rs.2/- each	Rs.261.581 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		30.06.2007	30.06.2006	30.06.2005
SHAREHOLDERS FUNDS
1] Share Capital		261.581	257.800	240.300
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		16629.546	12987.200	6678.900
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		16891.127	13245.000	6919.200
LOAN FUNDS
1] Secured Loans		1020.270	1347.200	1621.900
2] Unsecured Loans		11715.116	15078.400	6849.100
TOTAL BORROWING		12735.386	16425.600	8471.000
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		29626.513	29670.600	15390.200
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		17617.666	6982.000	3928.000
Capital work-in-progress		0.000	246.400	1989.200
INVESTMENT		3101.035	3247.800	1014.700
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	1577.139	1401.000	1180.500
	Sundry Debtors	1516.552	1195.000	1039.200
	Cash & Bank Balances	3932.289	14218.700	6412.800
	Other Current Assets	0.887	0.000	0.000
	Loans & Advances	4427.079	4062.000	1146.700
Total Current Assets		11453.946	20876.700	9779.200
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	1766.960	1285.200	1135.500
	Provisions	821.745	461.100	271.100
Total Current Liabilities		2588.705	1746.300	1406.600
Net Current Assets		8865.241	19130.400	8372.600
MISCELLANEOUS EXPENSES		42.571	64.000	85.700
TOTAL		29626.513	29670.600	15390.200

PROFIT & LOSS ACCOUNT

PARTICULARS		30.06.2007	30.06.2006	30.06.2005
Sales Turnover		11957.057	8734.400	6522.000
Other Income		0.000	414.900	415.900
Total Income		11957.057	9149.300	6937.900
Profit/(Loss) Before Tax		3220.528	2183.400	1201.400
Provision for Taxation		862.084	547.900	272.900
Profit/(Loss) After Tax		2358.444	1635.500	928.500
Export Value		3920.200	2270.900	772.200
Import Value		222.364	257.192	24.900
Expenditures :
	Cost of Goods Sold
	Manufacturing Expenses	7095.834	78.400	49.500
	Administrative Expenses	238.908	173.400	127.200
	Raw Material Consumed	0.000	5408.400	4576.000
	Salaries, Wages, Bonus, etc.	0.000	418.800	304.600
	Interest	0.000	202.500	128.100
	Financial Expenses	247.880	0.000	0.000
	Power & Fuel	0.000	164.900	115.900
	Depreciation & Amortization	0.000	497.400	410.900
	Other Expenditure	520.515	22.100	24.300
Total Expenditure		8103.137	6965.900	5736.500

QUARTERLY RESULTS

PARTICULARS	30.09.2007	31.12.2007
Type	1^st Quarter	2^nd Quarter
Sales Turnover	3116.900	3199.100
Other Income	318.600	297.500
Total Income	3435.500	3496.600
Total Expenditure	2269.200	2315.800
Operating Profit	1166.300	1180.800
Interest	77.200	78.600
Gross Profit	1089.100	1102.200
Depreciation	226.000	225.600
Tax	97.800	99.600
Reported PAT	637.700	646.600

KEY RATIOS

PARTICULARS		30.06.2007	30.06.2006	30.06.2005
PAT / Total Income	(%)	19.72	17.87	13.38
Net Profit Margin (PBT/Sales)	(%)	26.93	24.97	18.42
Return on Total Assets (PBT/Total Assets}	(%)	11.08	20.84	7.65
Return on Investment (ROI) (PBT/Networth)		0.19	0.16	0.17
Debt Equity Ratio (Total Liability/Networth)		0.91	1.37	1.43
Current Ratio (Current Asset/Current Liability)		4.42	11.95	6.95

LOCAL AGENCY FURTHER INFORMATION

HISTORY:

Promoted by Arvind Dham and W L Dham in the assisted sector along with the Haryana State Industrial Development Corporation (HSIDC), a flagship of AMTEK GROUP and incorporated in 1985. The company is a leading Indian supplier of automotive components and its is also an integrated automotive component manufacturer of forgings, machining and sub-assemblies. The company supplies over 300 varieties of components and assemblies to leading domestic and global vehicle original equipment manufacturers. 

A public issue was made in 1988 to part-finance its Rs36.900 millions project to manufacture Rs.0.50 million connecting rod assemblies pa. In 1991-92, the company increased its capacity by Rs.0.250 million at a cost of Rs.27.900 million (fully financed by loans). In 1995, it integrated backward by commissioning a forging line and expanded the capacity for connecting rods from Rs.0.750 million to Rs.0.120 million. To part-finance this, it raised Rs.108.200 million through private placement.  

In 1995-96, the company has completed its expansion plan leading to substantial increase in production capacity for the manufacture of connecting rods. It enhanced its forgings capacity from 1500 tpa to 7500 tpa. The company all plants were accredited with ISO 9002 certification for quality systems. 

In 2000-01 a hitech company was acquired by Amtek which has a state of the art of Italian presses to produce high quality forgings.The company is having technical assistance with Japan's biggest manufacturers of Connecting Rods namely Aizen Company Limited Japan. Another technical alliance is that between M/s Ateliers Siccardi of France for manufacturing upto six-throw Crank Shafts. 

The paid up equity was increased during the year 2002-03 from Rs.77.5 millions to Rs.154.9 millions. The company had issued Bonus shares in the ratio of 1:1 and consequent of this bonus issue, the paid up has been increased. 

December 2004, Amtek Investment UK Limited, a 100% UK subsidiary of the company has acquired additional 3.40% equity in its subsidiary GWK Amtek Limited With this acquisition the stake of Amtek UK Limited in GWK Amtek Limited has increased to 88.40%. 

Amtek Gears Inc has set up a Ring Gear unit at Bay City near Detroit for manufacturing of 9 million fly wheel ring gears per annum. In July 2005, the company has acquired 70% equity stake o Zelter through its wholly owned subsidiary Amtek GmbH. Further in July 2005 the company has entered into 50:50 joint venture with Neumayer Tekfor GmbH, Germany, for manufacturing of high precision fractured connecting rod assemblies and modules in India. 

In October 2004 the company has sub-divided its equity share face value from Rs.10/- per share to Rs.2/- per share. 2004-05 the company has increased its installed capacity of Machined Auto Components and Forgings by 2.180 Nos (in Millions) and 18500 TPA respectively. With this expansion the total installed capacity of Machined Auto Components and Forgings has increased to 17.5 Nos (in Millions) and 60000 TPA respectively.

PERFORMANCE: 

During the year under review, the Company has recorded a turnover of Rs.119570.570 millions as against a turnover of Rs.8949.632 millions thus recording a growth of more than 33% over the previous year. The Profit after Tax of the Company for the year stands at Rs.2358.444 millions as against the corresponding year figure of Rs.1635.503 millions thus reflecting a growth of more than 44% over the previous year. The Company has strong reserve position of Rs.16629.546 millions. 

ACQUISITIONS: 

ENTIRE ASSETS OF J.L. FRENCH'S (WITHAM) LIMITED: 

the Company has acquired entire assets of U.K. based J.L. French's (Witham) Limited (JLF), a Company engaged in the business of manufacturing of HPDC Aluminium for automotive application. The J.L. French's business has been developed to offer die-casting solutions including product design, simulation, testing, rapid prototyping, high pressure die-casting, precision machining and assembly. This is predominantly aimed at the European automotive industry. However, there are a number of alternative strategic markets, which could also be explored. 

JLF has a fully equipped HPDC aluminum facility and most of the aluminum castings produced in this facility are machined components. This facility has 18 HPDC lines between 400 and 1600 tonnes rating. The current turnover of JLF from this facility is about US$ 60 mn. At 60% capacity utilization. 

JLF has a number of years experience in Full Service Supply for FEAD (Front End Auxiliary Drive) and Engine/Transmission Bracket Supply and has been a "QI" Accredited Ford Motor Company ("FMC") key tier 1 supplier for a number of years and is currently working towards ensuring that they are TS compliant. This facility currently makes a variety of aluminium castings for the customers like Land Rover, Jaguar, Trellborg, Ford and PAS (Peugeot). 

This acquisition will be another milestone for the Company and a step forward in direction of expanding its customer and product portfolio as well as attaining world class technological edge in automotive component manufacturing, especially in aluminium high pressure die-casting segment. 

TRIPLEX-KETLON GROUP OF U.K.: 

Subsequent to the year ended 30th June 2007, in the month of November, 2007, the Company has also acquired one of the largest automotive precision machining Companies M/s. Triplex-Ketlon Group, which was also Amtek's strongest competitor running close to 185 different machining lines and a multi-location presence in the UK. Triplex-Ketlon manufacturing facilities are located in addock Wood, Stratford-upon-Avon and Hereford all in UK. 

At sales revenue of $152 million per annum, Triplex-Ketlon was one of UK's large but independent precision machining Companies. This acquisition further consolidates the position of Amtek presence in Europe's automotive scene and makes Amtek's combined precision machining operations the largest in the UK and probably one of the largest in Europe as well. 

This acquisition comes as an expansion for Amtek's precision machining operations, which currently comprises of two large precision machining facilities in Coventry and Letchworth in UK besides their machining operations in India and Germany. 

Triplex-Ketlon is regarded as a dominant player in Europe's strong automotive industry with a very strong customer base that Includes names like Perkins, Land Rover, Honda UK, Ford, TRW, JCB, Toyota UK, Dana Spicer, Honeywell amongst others. This provides Amtek an entry into the very high growth Japanese OEMs like Toyota and Honda in Europe, besides getting Amtek into high value gear manufacturing in Europe. 

The main products of this Company include Ladder Frames, Engine and transmission covers, Steering Knuckles, Flywheel Assemblies, Exhaust and Intake Manifolds, Wheel Hubs and Flanges, Brake Discs, Pulleys, Piston, Hydraulic Actuators, Gear Box Housings and most Important Gears, Shafts and Sprockets. 

Triplex-Ketlon is a profitable business and has long-term business relationships with its customers. All the current customer contracts are long-term. With this acquisition the combined operations of Amtek increase in size to more than $650 Million per annum just in UK alone. Adding the German machining operations at Zelter and the Midwest Manufacturing in USA, the combined sales revenue of the Amtek overseas operations increases to about $770 Million. Amtek targets its overseas sales revenue to cross $1.0 Billion within next 2 years. 

With the acquisition of Triplex-Ketlon, Amtek has drawn up an integration plan which will bring in considerable cost savings due to variable and fixed cost synergies, besides providing Amtek an entry into new customers like Honda and Toyota in UK and also to some non automotive customers. 

This also increases the scope and possibility of additional highly profitable outsourcing opportunities worth $100 Million for Amtek's forging and iron casting and aluminium die-casting operations in India. This is in line with Amtek's strategy of expanding its forging, iron and aluminium casting capacities in India over the last 2 years at a cost of over INR 500 Crores for meeting the captive demand for forgings and castings of Amtek's Overseas operations. 

MANAGEMENT DISCUSSION AND ANALYSIS REPORT: 

OVERVIEW: 

Automotive Industry offers huge growth potential in terms of sale volume (including exports) and also immense employment opportunities. It is expected that the world production of Auto Components would reach USD 1.7 Trillion by 2015. About USD 700 billion worth of auto components shall be sourced out from low cost countries by 2016. If India targets a 10% share of this potential, it would mean USD 70 billion, nearly five times current total size of industry in India. The projected size in 2016 of the Indian automotive industry varies between USD 122 and USD 159 billion including USD 35 billion exports. This translates into a contribution of 10-11% of India's GDP by 2016 that is double the current distribution. This would mean a domestic vehicle market of USD 82 billion by 2016, USD 12 billion exports of vehicles and tractors, USD 20-25 billion component exports and more than USD 5 billion after market components. Another USD 2-2.5 billion in engineering services outsourcing opportunity is expected to develop. The total size of the auto component industry in India is expected to become USD 40-45 billion by 2016. 

INDIAN AUTOMOTIVE INDUSTRY: 

The Indian Automotive Industry embarked on a new journey in 1991 with delicensing of the sector and subsequent opening up for 100 per cent FDI through automatic route has grown at a spectacular rate on an average of 17% for last few years. The Industry has attained a turnover of Rs.1650000.000 millions (34 billion USD) and an investment of Rs.500000.000 millions. The Industry is providing direct and indirect employment to 1.31 crore people. It is also making a contribution of 17% to the kitty of indirect taxes. The export earning from the section has grown on an average 30% per year during the last five years. Almost all the global majors have set up their facilities in India. The Indian Automobile industry has emerged as:- 

·  Largest motor cycle manufacturer in the world; 

· 2nd largest two wheeler manufacturer in the world; 

· 5th largest Commercial Vehicles Manufacturer in the world; 

· 9th largest Passenger Vehicles Manufacturer in the world. 

INDIAN AUTO COMPONENT INDUSTRY:

The Indian auto component industry is expected to witness a boom as the global car majors including DaimlerChrysler AG, Chrysler (owned by Cerberus), Volkswagen, General Motors, Renault-Nissan, Volvo, JCB, and Caterpillar and others are drawing up plans to source components from Indian suppliers. 

According to the Auto Component Manufacturers Association (ACMA), the apex body of component makers in India, global sourcing of components form the country will double from $2.95 billion to $5.9billion in 2008-09, and is slated to hit $20 billion in seven years. 

The sourcing of common components from Indian component industry such as axle assembly, propeller shaft, crank shaft, cylinder heads, bearings and cylinder blocks. Offers cost advantage of 25-30 percent. Viewing the cost advantage, a number of International players like Chrysler, German manufacturer Volkswagen AG, General Motors, the world's second-largest car-maker, Renault-Nissan are setting up local sourcing units in India or in the process of appointing component suppliers from India. 

Indian auto components companies are being globally recognized and no longer have to knock at the doors of international auto companies. In addition, Indian companies are witnessing a three-to-four-fold growth in demand from existing customers for the next three to four years. 

OPPORTUNITIES: 

· A Stable, Market Based and Growth Oriented Economy; 

· Global Integration of the Economy; 

· Fast Growing Automobile Industry; 

· A Vibrant and Competitive Auto-Component Industry; 

· Growth of Indian middle class with increasing purchasing power; 

· Availability of trained manpower at competitive cost. 

· Proficiency in Understanding Technical Drawings specifications and well conversant in all Global Automotive Standards: American, Japanese, Korean, European Standards etc.

· IT Core Competencies: Tranied and Skilled Software Engineers, Modern Communication hardware in place, Licensed Software's, Knowledge of engineering and manufacturing. 

· Big Automotive RandD Base: Global MNCs Shifting Automotive Design Centers into India. 

CONSTRAINTS: 

· Managing Expectations; 

· Culture - A Global Diversity; 

· English - Divided by a common language; 

· Legislation/Commercial Issues; 

· Improvement in infrastructure specially power, highways and ports; 

· Exchange Rate Risk Forward Cover available only for one year; 

· Scaling up and Talent Transformation; 

· Limited knowledge/experience of Product Liability Issues and Offshore Warranty Handling. 

FUTURE OUTLOOK: 

The future challenge for Indian automobile industry would be to develop a supply base with emphasis on lower costs and economies of scale, develop technical and human capabilities, overcome infrastructural bottlenecks, stimulate domestic demand and exploit export and international business opportunities. The key to success is to achieve the critical mass that would make India competitive and profitable for sustained investments.

Keeping these in view, the identified challenges and interventions are in the areas of competitiveness in manufacturing and flow of technology; demand, brand building and infrastructure; export and international business; environmental and safety standards, and human resources development. A key deficiency that needs to be addressed for attaining the vision is to improve competitiveness in manufacturing. Systematic deficiencies could be overcome through a long-term and stable policy regime that will support the industry to fulfill its potential. 

RISKS and CONCERNS: 

The growing number of FTAs (Free Trade Agreements) that are being signed by India with countries like Thailand, Singapore, China etc is likely to hurt the domestic players as they pay a relatively higher duty of around 25% as compared to 1%-10% being paid by its Asian counterparts. 

Quality consideration and Labour Productivity: Indian automobile components industry does not match global standards. The rejection rate for Indian auto components is on higher side in comparison to other countries, on the other side low labor cost advantage is nullified on accounting for the relatively low labour productivity in the country as compared to international norms. So there is a need of Promotion of R and D in the automotive sector to ensure continuous technology upgradation and innovation, building better designing capacities to remain competitive. 

The per capita Income in India is constantly increasing leading to higher disposable income. Today's urban consumer with his higher purchasing power demands the best. So the key challenge of industry is to develop human resource skills and competencies specifically in the areas of product development and manufacturing engineering. 
Not enough economies of scale - Despite being around 60 years old, the domestic auto industry is even behind countries like South Korea, Brazil and Mexico in terms of production and sales, thus depriving it the benefit of economies of scale. This makes it difficult for companies to invest extensively in R and D and development, a key competitive tool in the global market. 

Insufficient design capabilities: Over the last few years, global automakers have been passing on responsibilities of research, design, development, testing, validation and integration to vendors. And even OEMs start outsourcing from low - cost countries, they want to ensure that the new sources have the desired design capabilities too. India at present does not have sufficient design capabilities.  Automotive industry is exposed to cyclical economic downturns and most components companies are dependent on global majors for technologies. 

The major challenge that the auto industry is presently facing is with respect to its capabilities to innovate and upgrade in order to remain competitive in the international market. Further, the industry has to develop a supply based with emphasis on lower cost and economies of scale, develop technical and human capabilities, overcome infrastructural bottlenecks, stimulate domestic demand and exploit export and international business opportunities. The Company is exposed to a variety of risks caused by steep rise in interest rates, price increase in input materials, currency fluctuations, change in models and design, low volumes, pricing pressure, stiff competition etc. The Company will attempt to soften the impact of risk through continuous monitoring, timely action and control measures. 

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE: 

The Company has registered a turnover and other income of Rs.11957.057 millions, which shows an increase by 33.60% from Rs.8949.632 millions as against the total income of the previous year. 

The Gross profit before depreciation and taxation has increased from Rs.2680.733 millions during the previous Year to Rs.3853.920 millions during the current Year registering an increase of 43.76%. 

The Profit before tax increased from Rs.2183.366 millions during the previous Year to Rs.3220.528 millions representing an increase of 47.50%. 

The Profit after tax has also increased from Rs.1635.503 millions during the previous Year to Rs.2358.444 millions representing an increase of 44.20%. 

The company declared dividend at the rate of Rs.3/- per share or 150% in the current year. All the units of the company operated satisfactorily during the year. 

MATERIAL DEVELOPMENT IN HUMAN RESOURCES/INDUSTRIAL RELATIONS FRONT: 

Employees are valuable resources who are the strength of an organization in its growth, prosperity and development. The company has put in place various systems to reward and recognize employee contribution towards the growth of the company. 

The Company has a team of qualifies and dedicated personnel who have contributed to the growth of the company. Necessary training programs are arranged to bridge the gap between existing skills and desired skills of the employees with organizational needs which includes understanding and utilizing new technology, inter-functional knowledge, safety awareness, etc. The company is continuously striving to create an appropriate climate, opportunities and systems to facilitate identification, development and utilisation of their full potential. The company has laid down an effective and transparent performance Management System (PMS) to track, monitor, enhance performance and reward achievements. 

The Company believes in promoting a culture of meritocracy through an approach of performance linked bonus and rewards. PMS starts with tasks and targets of top management team drawn from the Business plan formulated at the beginning of the year. 

OTHER INFORMATION:

Contingent Liabilities:	30.06.2007	30.06.2006
	(Rs. in millions)
a) Estimated amount of contracts remaining to be executed on Capital Account and not provided for	112.528	95.221
b) Guarantees issued by the Bank' on behalf of the Company	5.489	5.489
c) Unexpired Letters of Credit	6.653	4.278

Fixed assets

· Land and Site Development

· Building

· Plant and Machinery

· Electrical Installation

· Furniture and Fixtures

· Office Equipment

· Vehicle

AWARD:

The Company has been awarded with 'Economic Times Emerging Company of the year Award' by Hon'ble Prime Minister of India Dr. Manmohan Singh on 6th October 2006. 

The Company has also featured in the Business World magazine's list of the fastest wealth creating companies in the India for the last few years. 

Press Release:

· Amtek Auto Limited acquired Aluminium Foundry plant JLF French, Witham ( UK)

· Amtek Auto Limited acquired one of the largest automotive precision machining companies, Triplex- Ketlon Group running close to 185 different machining lines and a multi-location presence in the UK. Its manufacturing facilities are located in Paddock Wood, Stratford-upon-Avon and Hereford in the UK.

· Amtek Auto Limited has signed third global JV to acquire high-level technology for the next generation of engines and components. The group has forged a 50:50 joint venture with Belgian Gear manufacturer, VCST.

· Amtek Auto Limited , Bhopal Unit has received the HONDA AWARD for QCDDM in category of Casting and Forgings from HONDA MOTORCYCLE and SCOOTER INDIA Private Limited for the year 2006-07. This was awarded at Honda's annual convention at New Delhi on 20^th March 2006 by Mr YUKIHIRO AOSHIMA , President and CEO of HMSI.

· A new manufacturing facility being establised in JV with Neu mayer Tekfor for manufacturing fractured connecting rod assemblies for new diesel engine project of Maruti Undyog Limited.

· Acquisition of Zelter, Gmbh in Germany. Zelter is one of the three largest manufacturer of Turbo Charger Housing in the world.

· Acquisition of an Aluminium Casting facility in the UK.

· Amtek has Launched Lean Six Sigma in its Facilities worldwide.

· Establishing a new 14 Acre Foundry facility in Bhiwadi, with two DISA 2013 Moulding Lines.

· A new manufacturing facility being established in Sanaswadi, Pune (India), which spreads across 55 acre, having Forging, Casting and machining facility.

· Amtek was awarded The prestigious- ET-Emerging company of the year 2006

WEBSITE DETAILS:

Subject, incorporated in 1985 is currently engaged in manufacturing of a wide range of components for automotive applications mainly for use in engine, transmission and suspension systems. The major categories of components include connecting rod assemblies (largest in India), steering knuckles, suspension and steering arms, CV joints, crankshaft assemblies for two-wheelers, torque links, machined aluminum case components and a wide range of precision forgings.

Subject has expanded its manufacturing setup from a single manufacturing facility to a multi-location setup and today it operates from the following facilities:

Amtek Auto Limited: Unit I – TS 16949 / QS 9000

Amtek Auto Limited: Unit II – TS 16949 / QS 9000 / ISO 14001

Amtek Auto Limited: Unit III – QS 9000

Amtek Auto Limited: Unit IV (Bhopal) - QS 9000

Amtek Auto Limited: Unit V (Dharuhera) - QS 9000

Amtek Auto Limited: Unit I - TS 16949 / QS 9000

AAL - Unit I, the first manufacturing facility of the company was commissioned in 1988. Located near Sohna in Haryana, caters to a captive demand for engine connecting rod assemblies and aluminium case housings. the manufacturing facility at AAL Unit-I was modernized from a SPM (Special Purpose Machine) setup with very low flexibility to GPM (General Purpose Machine) and CNC (Computerized Numeric Control) Machine setup with a greater flexibility in manufacturing.

The Unit-I division supplies to Maruti Suzuki, Escorts Yamaha, Eicher Motors, Subros, Hindustan Motors and Eicher Tractors.

Amtek Auto Limited Unit II - TS 16949 / QS 9000 / ISO 14001

This facility was established with a technical collaboration with Material Forming Technologies, Sheffield U.K, as a backward integration unit for the machining units of the company. It is a closed die press forging facility located in Gurgaon. This plant is equipped with state-of-the-art forging presses imported from Germany. It also has an in-house modern tool design and development facility and a tool room equipped with CAD/CAM centres equipped with ultra-modern design and manufacturing softwares, CNC machines and EDM (Electrolytic Discharge Machine)

Besides catering to the in-house demand for high quality forgings of Amtek's machining units, this unit also supplies to external customers.

This Unit is OEM supplier to Hero Honda, Yamaha Motors, Hindustan Motors, JCB, JBML, Musashi Auto Parts and LML.

Amtek Auto Limited Unit III - QS 9000

In view of the changing needs of the customers and an unflinching commitment to constant product improvement and global quality standards, AAL Unit III, certified for QS 9000 was established in a technical collaboration with Aizen Limited, Japan. The manufacturing facility is an ultra-modern, completely automatic transfer-type machining lines which are only of its kind in India. The collaboration with Aizen Limited, Japan for piston assemblies, case components ensures a constant transfer of technical know-how production processes and techniques and a facility training of Amtek Engineers and workmen at Aizen Japan. This unit has been a pioneer in the manufacturing of Power Cylinder Modules (PCM) in india.

This unit is OEM supplier to Maruti Suzuki.

Amtek Auto Limited: Unit IV (Bhopal) - QS 9000

Located in Bhopal, this plant was established in order to deal with the manufacturing of high screw presses precision forgings with an installed capacity of 9000 tons of components per annum. The unit has state of the art manufacturing facilities consisting of friction screw presses imported from Germany and technical arrangement with Halverscheidt, Germany. This plant is engaged in manufacturing of gear components like crankshaft, crankcase, cluster gear, cluth gear, weight, Hypoid pinion, Bull pinion gear shaft, gear driven differential bevel gear, planetary, MS shaft, journal, CV bell forging etc.

This unit is OEM supplier to companies like Hero Honda, TVS Group, Bajaj Auto, LML, Honda Scooters, Hyundai Motors and Hindustan Motors etc.

CMT REPORT (Corruption, Money Laundering and 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 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.40.18
UK Pound	1	Rs.79.25
Euro	1	Rs.62.90

SCORE and RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	8
PAID-UP CAPITAL	1~10	8
OPERATING SCALE	1~10	8
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	9
--PROFITABILIRY	1~10	7
--LIQUIDITY	1~10	8
--LEVERAGE	1~10	8
--RESERVES	1~10	8
--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	YES
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		72

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 EXPLANATIONS

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 and 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 and 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
NR		In view of the lack of information, we have no basis upon which to recommend credit dealings	No Rating

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