MIRA
INFORM REPORT
|
Report Date : |
05.12.2008 |
IDENTIFICATION
DETAILS
|
Name : |
EXIDE INDUSTRIES LIMITED |
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Registered Office : |
Exide House, 59E, Chowringhee
Road, Kolkata – 700 020, West Bengal |
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Country : |
India |
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Financials (as on) : |
31.03.2008 |
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Date of Incorporation : |
23.10.1970 |
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Com. Reg. No.: |
21-14919 |
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CIN No.: [Company
Identification No.] |
L31402WB1970PLC014919 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
CALE01193D / CALC00084A |
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PAN No.: [Permanent
Account No.] |
AAACE6641E |
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Legal Form : |
It is a public limited liability
company. The company’s shares are listed
on the Stock Exchanges. |
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Line of Business : |
Manufacturing of Lead Acid
Storage Batteries. |
RATING &
COMMENTS
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MIRA’s Rating : |
Aa |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
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Maximum Credit Limit : |
USD 51000000 |
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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
and reputed company having fine track.
Available information indicates high financial responsibility of the
company. Financial position of the
company is good. Payments are usually
correct and as per commitments. The
company is progressing well.
The company can be considered good for any normal business
dealings at usual trade terms and conditions. |
LOCATIONS
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Registered Office : |
Exide House, 59E, Chowringhee
Road, Kolkata – 700 020, West Bengal, India |
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Tel. No.: |
91-33-22478320
/ 8326 / 8329 / 2313 / 22403604 / 22801083 / 2280 2150-51 / 22832120 / 22832133 /
22832136 / 50 |
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Fax No.: |
91-33-22479819
/ 22870725 / 2283 2632/37 |
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E-Mail : |
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Website : |
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Factory : |
West Bengal 91 New Chord Road, Athpur, Shamnagar, 24 Parganas (N) - 743 128
Durgachak, Haldia, District Midnapore, West Bengal -72 1602
Haryana Plot No. 179, Sector 3, HSIDC Growth Centre, Bawal - 123 501
Maharashtra D2, MIDC Industrial Estate, Chinchwad East, Pune 41 1019, Maharashtra, India
Plot No. T-17 MIDC Taloja Industrial Area, Taloja- 410 208
Kanjur Village Road, Kanjurmarg (East), Mumbai - 400 042
Tamil Nadu 21/22 Alandur Road, Guindy, Chennai - 600 032
Chichurakanapalii, Sevaganapalli Panchayat, Hosur Taluk,
District Dharmapuri - 635 103 |
DIRECTORS
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Name : |
Mr. R. G. Kapadia |
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Designation : |
Chairman and Non Executive
Director |
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Name : |
Mr. S. B. Ganguly |
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Designation : |
Executive Chairman and Chief
Executive Officer |
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Qualification: |
B.Sc. Engineering (Chem.), FIRI
(Lond), FIC FII Ch.E |
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Experience: |
39 years |
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Date of Joining: |
01.04.1986 |
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Previous Employment: |
Dunlop India Limited, Director (Research
and Technical) |
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Name : |
Mr. R. B. Raheja |
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Designation : |
Vice Chairman and Non Executive
Director |
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Name : |
Mr. T. V. Ramanathan |
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Designation : |
Managing Director and Chief
Executive Officer |
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Qualification: |
B.Com., FCA, ACS |
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Experience: |
34 years |
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Date of Joining: |
01.02.1995 |
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Previous Employment: |
UB Group, Bangalore – Group Vice
President – Finance |
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Name : |
Mr. G. Chatterjee |
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Designation : |
Director (Industrial) |
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Qualification: |
B.E., (Mech.), PGDBM (IIM) |
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Experience: |
30 years |
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Date of Joining: |
23.08.1982 |
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Previous Employment: |
Indian Oxygen Limited –
Production Engineer |
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Name : |
Mr. S. K. Mittal |
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Designation : |
Director (Research and
Development) |
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Qualification: |
M.S., Ph.D., (Engg. Sc.)
(Florida) |
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Experience: |
30 years |
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Date of Joining: |
11.03.1974 |
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Previous Employment: |
Florida Department of
Environment Control (USA) – Environmental Specialist |
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Name : |
Mr. Vijay Aggarwal |
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Designation : |
Non-Executive Director |
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Name : |
Mr. H. M. Kothari |
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Designation : |
Non-Executive Director |
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Name : |
Mr. Bhaskar Mitter |
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Designation : |
Non-Executive Director |
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Name : |
Mr. S. N. Mookherjee |
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Designation : |
Non-Executive Director |
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Name : |
Mr. A. H. Parpia |
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Designation : |
Non-Executive Director |
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Name : |
Mr. S. B. Raheja (Alternate D S
Parekh)
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Designation : |
Non-Executive Director |
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Name : |
Mr. W. Wong |
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Designation : |
Non-Executive Director |
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Name : |
Mr. P K Kataky |
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Designation : |
Director (Automotive) |
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Name : |
Mr. A K Mukherjee |
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Designation : |
Director (Finance and Chief
Financial Officer) |
KEY EXECUTIVES
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Name : |
Mr. Barun Das |
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Designation : |
Company Secretary |
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AUDIT COMMITTEE |
Mr. R. G. Kapadia |
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Mr. Bhaskqr Mitter |
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Mr. S. N. Mookherjee |
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Mr. Vijay Aggarwal |
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REMUNERATION COMMITTEE |
Mr. Bhaskar Mitter |
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Mr. R. G. Kapadia |
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Mr. T. V. Ramanathan |
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Mr. S. N. Mookherjee |
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Mr. Vijay Aggarwal |
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EXECUTIVE COMMITTEE |
Mr. T. V. Ramanathan |
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Mr. G. Chatterjee |
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Mr. S. K. Mittal |
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Mr. A. K. Mukherjee |
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Mr. Barun Das |
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Mr. Monodip Chaudhuri (upto 31 May 2008) |
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Mr. R. P. Ray |
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Mr. R. Chakraborty |
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Mr. P K Kataky |
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SHAREHOLDERS GRIEVANCE REDRESSAL COMMITTEE : |
Mr. Bhaskar Mitter |
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Mr. T. V. Ramanathan |
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Mr. G. Chatterjee |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
(As on 30.06.2008)
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Names of Shareholders |
Percentage of
Holding |
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Promoter Holding |
48.87 |
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Foreign Institutional Investors |
10.74 |
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Domestic Insurance Companies,
Mutual Funds and Banks |
18.94 |
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Other Bodies Corporate |
9.87 |
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Public |
11.58 |
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Total |
100.00 |
BUSINESS DETAILS
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Line of Business : |
Manufacturing of Lead Acid
Storage Batteries. |
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Products : |
·
Golf Cart Battery ·
OPzS ·
VRLA For Telecom ·
Plante ·
Tabular For Inverters ·
VRLA For UPS System ·
Traction ·
Railway Starter ·
Miner's Cap Lamp |
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Brand Names : |
'Exide', 'Dagenite', 'Dynex' and
'Index' |
PRODUCTION STATUS
(As on 31.03.2008)
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Particulars |
Unit |
Installed
Capacity |
Actual
Production |
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Storage
Batteries |
Nos. |
19785552 |
17818175 |
GENERAL
INFORMATION
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Suppliers : |
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Customers : |
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No. of Employees : |
3831 |
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Bankers : |
·
Corporation Bank, Kolkata,
West Bengal ·
Bank of America State
Bank of India Citibank
N.A BNP
Paribas Deutsche
Bank AG ABN
AMRO Bank N.V. Standard
Chartered Bank The
Hongkong and Shanghai Banking Corporation Limited HDFC
Bank Limited ICICI Bank Limited 2B Gorky Terrace, Kolkata – 700 071, West
Bengal, India Tel No. 91-33-2283 2209 Fax no.:91-33-2283 2308 E-mail: prakash.bagla@icicibank.com
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Facilities : |
*
Includes repayable within one year Rs. nil Securities (a) Secured by hypothecation of movable
assets of the company located at its Haldia and Shamnagar units. (b) Secured by hypothecation of movable assets
of the company located at its Chinchwad, Taloja and Hosur units. (c) Secured by hypothecation of stocks and book debts, both present
and future. |
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Banking
Relations : |
Good |
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Auditors : |
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Name : |
S. R. Batliboi and Company Chartered Accountants |
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Address : |
22, Camac Street, Block ‘C’, 3rd
Floor, Kolkata – 700 017, West Bengal, India |
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Solicitors: |
·
A.H. Parpia and Company Advocates and
Solicitors Address : 203-204
Prabhat Chambers, 92 S V Road, Khar (West), Mumbai – 400 052, Maharashtra,
India ·
Victor Moses and Company Advocates and
Solicitors Address : Temple Chambers, 6, Old Post Office
Street, Kolkata 700 001, West Bengal, India ·
Amarchand and Mangaldas and Suresh A Shroff and Company Advocates and
Solicitors Address : Ananda Lok, 227 AJC Bose Road, Kolkata 700 020, West Bengal, India |
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Membership : |
Confederation of Indian Industry
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Collaborators : |
·
Shin-Kobe Electric Machinery Company Limited, Hitachi
Group, Japan ·
The Furukawa Battery Company Limited, Japan |
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Subsidiaries : |
·
Chloride Batteries S.E. Asia Pte. Limited, Singapore (CBSEA) ·
Chloride International Limited (CIL) ·
Caldyne Automatics Limited (Caldyne) ·
Espex Batteries Limited, UK (Espex) ·
Associated Battery Manufacturers (Ceylon) Limited, Sri Lanka (ABML)
·
Tandon Metals Limited (w.e.f. 1, November 2007) |
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Associates : |
·
ING VYS'VA Life Insurance Company Limited ·
MSA (India) Limited (upto 1, March 2007) ·
Chloride Eastern Limited, UK. (GEL) ·
Chloride Eastern Industries Pte Limited, Singapore (CEIL) ·
LIEC Holdings SA, Switzerland ·
CEIL Motive Power Pty Limited, Australia (w.e.f. 13,
Dec 2007) |
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Holding
Company: |
·
Chloride Eastern Limited,
UK |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
1000000000 |
Equity Shares |
Rs.1/- each |
Rs.1000.000 millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
800000000 |
Equity Shares |
Rs.1/- each |
Rs.800.000 millions |
Includes 1350000 shares issued for
consideration other than cash and 540469580 shares issued as fully paid up
bonus shares by capitalization of Securities Permium and Capital and Revenue
Reserves
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES
OF FUNDS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
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SHAREHOLDERS
FUNDS |
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1] Share Capital |
800.000 |
750.000 |
750.000 |
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2] Share
Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves &
Surplus |
9463.534 |
5954.658 |
4789.412 |
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4] (Accumulated
Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH
|
10263.534 |
6704.658 |
5539.412 |
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LOAN FUNDS |
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1] Secured Loans |
2723.992 |
2778.731 |
1562.710 |
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2] Unsecured
Loans |
774.115 |
468.286 |
1335.834 |
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TOTAL BORROWING
|
3498.107 |
3247.017 |
2898.544 |
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DEFERRED TAX
LIABILITIES |
479.000 |
446.500 |
511.000 |
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TOTAL
|
14240.640 |
10398.175 |
8948.956 |
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APPLICATION OF FUNDS
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FIXED ASSETS [Net Block]
|
5551.069 |
4658.281 |
4512.427 |
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Capital work-in-progress
|
466.665 |
310.097 |
62.093 |
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INVESTMENT
|
5182.755 |
3780.096 |
2785.321 |
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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
|
5707.431
|
3966.103
|
2417.219
|
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Sundry Debtors
|
2592.122
|
1483.870
|
1528.369
|
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Cash & Bank Balances
|
16.779
|
14.181
|
173.741
|
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Other Current Assets
|
0.000
|
0.000
|
0.000
|
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Loans & Advances
|
448.397
|
257.918
|
285.578
|
Total Current Assets
|
8764.729
|
5722.072
|
4404.907
|
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Less :
CURRENT LIABILITIES & PROVISIONS
|
|
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|
|
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Current Liabilities
|
4670.690
|
3231.192
|
2186.261
|
|
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Provisions
|
1053.888
|
841.179
|
629.531
|
Total Current Liabilities
|
5724.578
|
4072.371
|
2815.792
|
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Net Current Assets
|
3040.151 |
1649.701
|
1589.115
|
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MISCELLANEOUS EXPENSES
|
0.000 |
0.000 |
0.000 |
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TOTAL
|
14240.640 |
10398.175 |
8948.956 |
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PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
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Sales Turnover |
28449.347 |
18703.201 |
13793.006 |
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|
Other Income |
64.547 |
93.707 |
64.882 |
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Total Income |
28513.894 |
18796.908 |
13857.888 |
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Profit/(Loss) Before Tax |
3743.276 |
2352.079 |
1517.255 |
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|
Provision for Taxation |
1240.000 |
800.000 |
510.000 |
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|
Profit/(Loss) After Tax |
2503.276 |
1552.079 |
1007.255 |
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Earnings in Foreign Currency : |
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Export Earnings |
1359.692 |
823.911 |
694.048 |
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Dividend |
5.245 |
8.637 |
2.525 |
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|
Technical Assistance Fee |
3.836 |
4.370 |
3.827 |
|
|
Interest |
1.455 |
0.050 |
0.000 |
|
Total Earnings |
1370.228 |
836.968 |
700.400 |
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Imports : |
|
|
|
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|
Raw Materials |
5418.536 |
4418.931 |
3252.004 |
|
|
Stores & Spares |
42.368 |
31.845 |
30.818 |
|
|
Capital Goods |
587.766 |
306.781 |
69.125 |
|
|
Others |
129.377 |
178.831 |
24.601 |
|
Total Imports |
6178.047 |
4936.388 |
3376.548 |
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Expenditures : |
|
|
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Materials Consumed |
19409.516 |
12048.449 |
8354.284 |
|
|
Purchase of Trading Goods |
166.405 |
261.891 |
33.219 |
|
|
Personnel Costs |
1510.316 |
1239.626 |
994.295 |
|
|
Increase
in Stocks |
(835.118) |
(941.522) |
(181.146) |
|
|
Expenses |
3503.128 |
3017.337 |
2367.594 |
|
|
Interest and Finance Costs |
374.013 |
277.084 |
224.431 |
|
|
Depreciation
& Amortization |
642.358 |
541.965 |
547.957 |
|
Total Expenditure |
24770.618 |
16444.830 |
12340.634 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2008 |
30.09.2008 |
|
Type |
1st
Quarter |
2nd
Quarter |
|
Sales
Turnover |
9065.300 |
9004.400 |
|
Other
Income |
23.500 |
3.900 |
|
Total
Income |
9088.800 |
9008.300 |
|
Total
Expenditure |
7566.300 |
7524.400 |
|
Operating
Profit |
1522.500 |
1483.900 |
|
Interest |
108.100 |
133.600 |
|
Gross
Profit |
1414.400 |
1350.300 |
|
Depreciation |
162.400 |
169.400 |
|
Tax |
430.000 |
377.000 |
|
Reported
PAT |
822.000 |
778.400 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
PAT / Total Income |
(%) |
8.78
|
8.26 |
7.27 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
13.16
|
12.58 |
11.00 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
26.15
|
22.66 |
17.01 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.36
|
0.35 |
0.27 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.90
|
1.09 |
1.03 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.53
|
1.41 |
1.56 |
LOCAL AGENCY
FURTHER INFORMATION
HISTORY
Subject, the company was incorporated as Associated Battery Makers (Eastern)
Limited in 31st January of the year 1947 to purchase all or any of the assets
of the business of manufacturers, buyers and sellers of and dealers in and
repairers of electrical and chemical appliances and goods carried on by the
Chloride Electric Storage Company (India) Limited, in India. Thereafter, the
company started manufacturing storage batteries in the country and has grown to
become one of the largest manufacturer and exporter of batteries in the
sub-continent today. It manufactures the widest range of storage batteries in
the world from 2.5 Ah to 20,400 Ah capacity, covering the broadest spectrum of
applications and various technology configurations. The business segment of the
company comprises Automotive Batteries, Industrial Batteries and Submarine
Batteries. Its products are sold under the brands of Exide, Dagenite, Dynex and
Index. The Company's Plants at Chinchwad, Maharashtra and Bawal, Haryana are
ISO / TS: 16949 and ISO: 14001 certified by TUV, NORD and the one at
Kanjurmarg, Maharashtra is an ISO: 9001 certified by TUV, NORD.
As a manufacturer, the company had commissioned its second factory at
Chinchwad, Pune during the year1969, its first factory situated in Shamnagar,
West Bengal. The name of the Company was changed to Chloride India Ltd in 2nd
August of the year 1972. During the year 1976, the company's R and D centre was
established at Kolkata. After 12 years, the company had started its third
factory in the year 1981 at Haldia, West Bengal. The name of the Company was
again changed to Chloride Industries Ltd with fresh Certificate of
Incorporation dated 12th October of the year 1988. During the year 1994, a
technical collaboration was made with Shin Kobe Electric Machinery Company
Limited of Japan, a subsidiary of the Hitachi Group to accessing technology for
the new automotive vehicles entering the Indian market. The name of the Company
was further renamed to Exide Industries Ltd from Chloride Industries Limited in
25th August of the year 1995. In the year 1997, Subject's fourth factory was
commissioned at Hosur, Tamil Nadu.
During the year 1998, with an objective of increasing capacity without the time
lag in setting-up Greenfield project the company acquired industrial /
manufacturing units of Standard Batteries Limited located at Taloja and
Kanjurmarg (Maharashtra), Guindy (Tamilnadu). This acquisition strengthened its
production base as well as giving the Company access to technology from The
Furukawa Battery Company of Japan and also acquired a plant at Ahmednagar (Maharashtra)
from Cosepa Fiscal Industries Limited as a going concern. A year after, in
1999, EIL had acquired 51% of shareholding in Caldyne Automatics Limited. The
Company had acquired 100% of stake in Chloride Batteries S E Asia Pte Limited,
Singapore in the year 2000 and also in the same year subject had seized over
49% of stake in Associated Battery Manufacturers (Ceylon) Limited, Sri Lanka.
In 2003, Subject had commissioned another plant at Bawal, Haryana. During the
same year, the company made a new joint venture in UK, ESPEX, with controlling
stake of 51% holding. Consequent to acquiring further 12.50% Equity holding in
Associated Battery Manufacturers (Ceylon) Limited, Sri Lanka in the year 2004,
it became a subsidiary of the company. During the year 2004-2005 the company
launched new products like an upgraded version of ATB range battery, a large
size inverter battery MHD2000, MF batteries, VRLA range batteries and EK22
battery.
Subject made its investment in 50% shareholding of ING Vysya Life Insurance
Company Limited in the year 2005 and in the same year, the company launched new
GenX batteries. The Company secured the Best SMF Battery Award for three
consecutive years of 2005, 2006 and also in 2007. Subject got 1st Position for
Sustaining a High level of Productivity Award Contest by the CII for the year
2006-07. On the marketing front, with an objective to get a global platform to
expand its business the Company acquired a 100% stake in Caldyne Automatics
Limited in July 2007, Caldyne Automatics Limited became 100% subsidiary of the
company consequent to acquisition and also in the same year subject made
investment with 26% shareholding in CEIL Motive Power Pty Limited, committed
one Joint Venture in Australia. The Company acquired 100% of stake in Tandon
Metals Limited during the year 2007 and also acquired 51% of stake in Lead Age
Alloys India Ltd in June of the year 2008.
ECONOMIC
ENVIRONMENT
Even as the Finance Minister was presenting the budget to the nation, he
noted that macro fundamentals favour the continuation of about a 9% growth in
the current year. There was this emphasis on inclusive-growth, particularly in
view of this being a pre-election budget. A massive waiver of farm loans, along
with increasing doses of investment in Health, Education and Infrastructure,
were the highlights of the India story. Indeed, the planned increase in scope
of the National Rural Employment Guarantee scheme, to cover all districts of
the country, was a part of the continued endeavour of the Government to bolster
poverty alleviation efforts.
Foreign exchange inflows, which have crossed the US$ 300 billion mark, poses a
problem that the Reserve Bank of India is now engaging with. As a concomitant
of such huge inflows, coupled with a rise in the cost of almost all raw
materials and food grains globally, inflation has touched the high water mark
of 8%. Consequently, both the Government, and the RBI have announced a slew of
schemes, including reduction in customs duty and a ban on export of food
grains, to contain this problem.
Additionally, the contagious effect of the sub prime crisis, which started in
the US acquired global ramifications. Fortunately, the economy is somewhat
insulated since the GDP growth in recent years is basically driven by domestic
demand.
PERFORMANCE
Sixty one years represents the start of a new journey, after completion of six
decades that the company spent, in acquiring and maintaining its leadership
position in India and South Asia. It is a matter of satisfaction for the Board
to note that, during the year, the company's turnover jumped from Rs.20
billion, to surpass the Rs.30 billion mark.
In the Automotive Sector, vehicle production grew in double digits, other than
heavy commercial vehicles, which saw a slowdown. Tractor segment experienced a
degrowth as did motorcycles and three wheelers. It is pertinent to note that in
the global arena, India is now number one in tractors and three wheelers and
number two in production of two wheelers which include motorcycles, scooters
and mopeds. It has also emerged as the 11th largest car manufacturer, with 1.2
million units being produced last year.
The production of automotive batteries for four wheelers increased from 5.2
million units to 6 million units, whereas production of two wheeler batteries
rose from 6.7 million units to 7.2 million units. Batteries for industrial
applications manufactured during the year, also recorded a rise from 880
million Ah. to 1170 million Ah. It is a matter of pride for the Board that, the
company continued to dominate the car market, with an overall market share of
76%. The Finance Minister's announcement of a further reduction in the
differential excise duty on small cars, is now beginning to bear fruit, with
India emerging as a hub for manufacture of small cars, both for domestic
automobile producers and multi-national corporations.
The company continued as the preferred OEM supplier for existing and new car
models including the prestigious Logan from the Mahindra Renault combine, along
with Fiat's new models, which would debut some time in 2008. The company
currently supplies batteries for General Motor's Tavera and has been nominated
as a single source, for their new model to be unveiled in 2009 Honda has
nominated the company, as a single source for both their new models, to be
unveiled during the current year and in 2009. Hyundai's i-10 which debuted
during the year, has also placed its custom with the company and will source
batteries for its upcoming model, to be unveiled in the current year. At least
50% of the Nano from Tata Motors will have Exide batteries. Toyota also has
identified the Company as the vendor for batteries for its small car
project.
The Replacement Segment showed a high growth of over 19%, despite the extremely
competitive domestic scenario, with the advent of new players such as Tata
Yuasa, Minda and others. The company, however, continued to introduce new
products for every customer segment, to preserve its market share. In the
tractor market, retail sales under the Project Kisan showed a 31% growth over
the earlier year. The company now caters to 331 districts and covers about
35,000 villages, through over 2900 dedicated nodal dealers.
Sale of two wheeler batteries recorded its 13th successive year of growth with
both the subject arid SF brands growing by 25%. While the production of
scooters and mopeds recorded double digit growth, both the motorcycle and the
three wheeler production by manufacturers, recorded a degrowth. While this is a
matter of concern, the company expects to continue its growth through enhanced
focus-on the replacement market.
During the year, batteries for industrial applications, recorded an almost 50%
growth over the earlier year. Telecom battery sales grew at an exponential rate
and is expected to continue to post a healthy growth, in the current year.
Railways recorded a significant growth, despite an increase in the number of
players in this segment. Other segments such as Power and Projects, continued
to grow at healthy rates. Traction batteries grew by over 50% and Solar
business continued to thrive. Market share in all the above segments, were
either maintained or increased.
The Company has commissioned during the year a high technology Traction Battery
Plant at Haldia which caters to electric Fork Lift Trucks.
Export of industrial batteries continued to record impressive gains, with sales
having crossed the Rs.1000 millions mark. The focus of exports continued to be
UK, South Africa, South Korea and the European markets. The Australian market
engaged the company's attention with its vast potential and in order to tap
this, the company acquired a 26% shareholding in CEIL Motive Power Pty Limited,
one of the well known distributors in that market.
The submarine division has excelled during the year, having doubled its growth
and has sufficient orders in hand, for execution in the current year.
Noteworthy among these, is an order from the Indian Navy, for an Advanced
Technology Vehicle (ATV). as well as orders from the Admiralty Ship Yard of
Russia, for third country exports. This is the first time that, a Russian Ship
Yard has parted with orders, for Submarine batteries, to India.
During the year, the company acquired 100% shareholding in Tandon Metals
Limited, a Smelter located near Pune. This initiative would help the company in
using recycled lead, which would not only be cost competitive, but also ensure
better compliance of Batteries (Management and Handling) Rules, 2001.
NEW PRODUCTS
During the year, the company entered into an agreement to jointly develop
bipolar technology with a UK based Research organization - Atraverda Limited.
Key technology issues in development of bipolar batteries, have been identified
with the intent of creating a Pilot Plant at Chinchwad, to establish the
production technology. Low height batteries in the ATB brand for DIN
applications, commenced manufacture at Taloja from August 2007. The
tele-tubular range of industrial batteries, were introduced into production at
the Shamnagar Plant, from September 2007 onwards. The Sonic Jumbo range above
100Ah, for the full range, started production from October 2007. A new battery
for General Motors, was designed to replace a competitor's product. Perhaps the
most significant new product to come out of R and D during the year, was the
battery for the Tata Motors Nano car. In view of the innovative features
included in this battery, a design registration has been filed in India.
An application for an International Patent for Advanced Hybrid Maintenance free
technology, has been initiated in partnership with Daramic of USA. who have
supplied a special separator design, jointly for this purpose. Field trials
have commenced for maintenance free batteries at ABML Sri Lanka, where
introduction of the entire maintenance free range, is planned from June 2008.
Tests are in progress for a maintenance free version of a flat plate inverter
battery, which would be added some time during the year.
An extended stand-by range in transparent containers, was introduced into
production at Hosur in January 2008. An upgraded version of the maintenance
free range of motorcycle batteries, with a warranty of thirty six months, is
proposed to be manufactured at Chinchwad from May 2008. The new Research block
which was inaugurated at the R and D Centre in the earlier year, has added to
the company's capabilities for conducting in-house tests.
OPERATIONAL EXCELLENCE
In continuation of the company's approach to quality, the various
certifications already obtained under ISO/TS/16949, ISO9001 and ISO 14001
certification from TUV-Nord of Germany, is underpins the quality of Company's
product. In its intent to implement an exhaustive total quality management
system, the R and D Centre, the head office and all service stations, have also
been included in the certification process.
Preservation of the environment being a high priority for the company, the
plants at Shamnagar, Haldia, Hosur, Taloja and Chinchwad are ISO 14001
certified. In terms of the recognized OHSAS 18001 certification for health and
safety at the plant level, Hosur will become the first plant to be certified by
July 2008. A CII/ JIPM help audit for TPM at Haldia, has been implemented and
Chinchwad and Taloja are expected to follow by the year end.
The company had won the CII EXIM Business Excellence Award in 2006 for 'Strong
Commitment to Excel'. The company has once again won this award for 2007. In
addition, the company in 2006, had won the Gold Award for 'Manufacturing
Excellence' in the large automotive ancillary category. This year. Frost and
Sullivan have awarded the company amongst all categories, the Super Platinum
First Runner-up Award, adding a notch to the company's efforts towards moving
to excellence.
In 2007 the company won the TERI Corporate Environmental Award in recognition
of its 'Leadership efforts toward Environmental Management'. The company has
also won the EFY Award for the fourth year in succession.
The Batmobile service of the company, which is unique in its genre, continues
to maintain an average response time of 28 minutes across 31 major cities in
India and has logged over 0.680 million calls. This represents a unique
consumer interface, which the company continues to provide, free of any charge
to the vehicle owners for this service. Batmobile is the company's way of
showing its gratitude to its customers, which incidentally also results in
revenue generation through sale of batteries. The company's CRM project with
its portal 'exideoutreach.com' has been online through which total customer
database collected as at the end of the year exceeded 1.4 milion.
As part of the Supply Chain Management (SCM) system has reached an advanced
stage, implementation of the MRP module scan. It is expected that when fully
implemented, will help to reduce costs through better material
management.
HUMAN
RESOURCES
The company had 3888 nos. permanent employees as at the end of March 2008. The
training needs for the managerial category of employees is assessed by the HR
department, at the beginning of the year and a number of programmes are
organized with both in-house and external experts to deliver need-based
training.
The Directors wish to place on record the appreciation of the contribution by
all employees of the company in ensuring high levels of performance and
efficiency, which has helped the company to scale higher pinnacles of success.
The company also desires to place on record, its appreciation of the support
and co-operation of the distributors, C and F Agents, dealers, bankers and all
others associated as partners in the company's growth.
MANAGEMENT
DISCUSSION AND ANALYSIS
After clocking three years of an average GDP growth of just under 9%,
the tables have turned against India. Notwithstanding the US$300 billion foreign
exchange reserves, the woes of the sub-prime crisis have brought home the
possibility of a recession in US which remains India's largest trading partner
and hence a resultant slowdown in GDP growth. In addition, inflation has reared
its head once again and this time it is related to the supply side of the
economy. Most economic analysts agree that financial measures to help curb
inflation would inevitably lead to lower GDP growth. This is clearly a
challenge that confronts the regulatory authorities in India.
OUTLOOK
Subject continued to straddle the South Asian region as the largest power
solutions company. Production of automotive batteries rose to 6.0 million
units, while those for two wheelers increased to 7.3 million units. Production
of batteries for industrial application, increased to 1170 million Ah.
In the Indian market, Subject continued as the undisputed market leader. All
new entrants chose the company's products as either a single source supplier,
or as part of a dual supplier strategy that some organizations have decided to
adopt. The Logan from Mahindra Renault, Tavera of General Motors, Hyundai's
i-10, Fiat's new models, Honda's new car and of course Tata's much discussed
Nano, all placed their trust in the company's batteries.
In the retail after market, the company continued to garner the trust of
consumers. It is now common knowledge that, major growth opportunities lie in
tier-2 and tier-3 cities. In accordance therewith, the company has mapped out a
large expansion of the marketing infrastructure, on a hub and spoke model. It
is expected that this would enable the company to tap the full potential, which
exists in these fast growing markets.
An integral part of India's growth story, has been the quiet revolution that
has taken place in the telecom segment. In the last two years sale of telecom
batteries recorded significant gains. It is expected that the current year will
continue this trend. However, the market is becoming polarized with three major
customers emerging-BSNL, Reliance and the GSM player's joint venture entitled
INDUS. Power sector reforms have steadily progressed and concomitantly sale of
batteries to this segment have recorded a healthy rise.
Traction battery sales have shown a heartening growth and the company is in the
process of implementing a major expansion at the Haldia plant. Export of
traction batteries has continued to grow at healthy pace and the company's
existing marketing subsidiaries in Singapore and the UK, have contributed in no
small measure to this initiative. During the year, the company acquired a 26%
stake in an Australian distributor of traction batteries which will help prise
open that region's burgeoning markets.
The changes brought about in the earlier year, have helped the fast moving
industrial battery business to obtain better realizations. This is a segment
which continues to grow at a healthy pace, both in the OEM and trade segments,
dealing as it does with digital inverter and uninterrupted power supply
systems. In March this year inverter battery demand has shown an improvement
over the earlier year. The company's Torr Tubular batteries have found wide
acceptance.
Submarine battery sales reached an all time high in the past year, with a good
order book for the current year. There is an order from the Indian navy for a
battery for an Advanced Technology vehicle. In addition, the company has
received an order for a battery to be fitted on a Russian submarine, for
delivery to third country. This is the first such order emanating from Russia
and hopefully, more would follow in the years to come.
Lead continued to be the centre of attention in the company during the past
year. Lead prices have continued to rise inexorably in the past three years.
During the year, prices continued to oscillate between the lower ranges of US$
2000 and going upto US$ 3000. However, for a certain period during the
mid-year, prices had exceeded US$ 3700. This will give an idea of how violent
the fluctuations during the year had been. As a result, this has posed a major
challenge to the company's management. As in the past years, the company's R
and D Centre at Kolkata has continued its effort at re-designing products,
which would utilize lesser quantity of lead, better alloys with superior qualities,
all in order to moderate the problems that have arisen, as a result of lead
being the most important raw material that the company uses, to produce its
finished product - lead acid storage batteries.
ADEQUACY OF INTERNAL CONTROLS
The company's accounts are prepared on SAP Version 4.7, which is a real time
system. Focus has shifted from mere accounting to information systems, which
would enhance the ability of the management to take meaningful decisions based
on real-time data. The company is now actively engaged with Supply-Chain
Management requirements and integration of the company's dealers, in order to
make the entire value chain transparent, as well as fruitful with information
being available, about supplies being made to different dealers at a point of
time.
As mentioned in the earlier year, the 'company is also engaged in an exercise
to build up the data base of its end-customers, which is extremely useful for
generating loyalty and customer attention programmes. The company's portal exidereachout.com
is ideally poised to deal with dealers and end-customers, all of whom are part
of customer-relationship management. This is the proof that customers are the
most important people for the company and servicing their needs and
requirements, is paramount to the company's existence.
As mentioned to in earlier years, Subject continues to have a proper and
adequate system of internal control, reinforced by internal audit, which-is
carried out in two phases at every factory, branch and region. In addition to
locating any systemic problems in order to iron these out, internal audit in
the company also helps to ascertain areas of improvement that have taken place.
The company continues to give importance to the question of Corporate
Governance and the Audit Committee is one of the most significant measures, to
ensure that better governance continues to flourish, for the greater good of
the company's stakeholders.
QUALITY
The path to excellence lies through quality. The company continues to believe
that its transition to a great organization, can be tested by the touchstone of
quality. This is proven by the fact that, in 2006 the company had won the
CII-EX3M Bank Business Excellence Award for 'Strong Commitment to Excel'. In
2007, the company has once again won this award. Frost and Sullivan the
well-known business forecasters had awarded the company the Gold Award for
'Manufacturing Excellence'. In 2007, the company was awarded the first
runner-up award amongst all categories, achieving the Super Platinum
status.
The Batmobile Service of the company remains one of its special achievements,
with average response time being within thirty minutes and the service being
available in thirty one cities across the country. It is now acknowledged as one
of the most successful programmes in building a healthy customer relationship,
as well as demonstrating the company's commitment to quality for automotive
batteries. On the industrial battery front, the company has once again won the
EFY Award for the fourth time in succession, proving that quality is a
watchword in the company's scheme of things.
OPPORTUNITIES /
THREATS
While the threat of low cost imports from China and the Asean countries did not
fully materialize in the earlier year, there continues to be concern in this
area. This is because the Govt. of India had signed a number of free-trade
agreements including a CECA with Singapore. It continues to believe that
bilateral trade agreements must be negotiated as the Doha round of WTO negotiations
seems stalled. Import of batteries into the country continues apace, even
though they have not proved to be a major road block in the company's efforts
to grow. In order to take advantage of the lowering of duties for SAARC
countries, the company had exported batteries from its manufacturing subsidiary
in Sri Lanka in 2006. Last year, the quantum of batteries imported into India
from Sri Lanka went up significantly. In the current year, these efforts are
likely to get a further fillip with Exide transferring technology for
manufacture of maintenance-free batteries to Sri Lanka.
The company has always believed that, India should be able to export
manufactured products and during the year, export of industrial batteries
topped the Rs.1000 millions mark. The company's marketing joint venture in UK,
has posted extremely heartening results, as has the subsidiary in
Singapore.
The company's investment in ING Vysya Life Insurance Company Limited, continues
to make steady progress. India remains a country where life insurance has still
not reached a sizable portion of its vast population. Such a situation
represents a great opportunity for ING Vysya and it is expected that, the
company's investment in this organization will continue to help increase the
shareholder value.
The Research and Development Centre of the company is a part of the company's
strategic initiative. It is clear that as the company's global ambitions grow,
R and D must play a more active role to ensure that subject remains at the
cutting edge of technology. During the year, Subject entered into an agreement
with Atraverda, a research organization based in the UK, involved in bi-polar
technology. Work on this initiative continues and if this technology can be
commercially harnessed, the dividends will not be modest. Intellectual
properties are today recogned as being of primary importance in a company's
growth. The company's effort is to ensure that, this emphasis on intellectual
property is translated into technology, which can give the company a
competitive advantage globally.
FIXED
ASSETS
·
Goodwill
·
Land
·
Freehold
·
Leasehold
·
Buildings
·
Plant and Machinery
·
Moulds
·
Furniture and Finings
·
Motor Vehicles
·
Computers
AS PER
WEBSITE
Profile
The Company was incorporated as Associated Battery Makers
(Eastern) Limited, on 31st January, 1947 under the Companies Act, 1913 to
purchase all or any of the assets of the business of manufacturers, buyers and
sellers of and dealers in and repairers of electrical and chemical appliances
and goods carried on by the Chloride Electric Storage Company (India) Limited,
in India, since 1916 with a view thereto to enter into and carry into effect
(either with or without modification) an agreement which had already been
prepared and was expressed to be made between the Chloride Electric Storage Co
(India) Limited on the one part and the Company of the other part. The name of
the Company was changed to Chloride India Limited on 2nd August, 1972. The name
of the Company was again changed to Chloride Industries Limited vide fresh
Certificate of Incorporation dated 12th October, 1988. The name of the Company
was further changed to Exide Industries Limited on 25th August, 1995.
The Company manufactures the widest range of storage batteries in the
world from 2.5 Ah to 20,400 Ah capacity, covering the broadest spectrum of
applications. The Company has six factories strategically located across the
country – two in Maharashtra, one in West Bengal, two in Tamil Nadu and one in
Haryana. The Company’s predecessor carried on their operations as import house
from 1916 under the name Chloride Electrical Storage Company. Thereafter, the
Company started manufacturing storage batteries in the country and have grown
to become one of the largest manufacturer and exporter of batteries in the
sub-continent today. Subject separated from its UK-based parent, Chloride Group
Plc., in 1989, after the latter divested its ownership in favour of a group of
Indian shareholders. The Company has grown steadily, modernized its
manufacturing processes and taken initiatives on the service front. Constant
innovations have helped the Company to produce the world’s largest range of
industrial batteries extending from 2.5 Ah to 15000 Ah and covering various
technology configurations.
Milestones
1916
Chloride Electric Storage Company (CESCO) UK sets up trading operations
in India as an import house.
1946
First factory set up in Shamnagar, West Bengal.
1947
Incorporated as Associated Battery Makers (Eastern) Limited on 31
January 1947 under the Companies Act.
1947
Incorporated Chloride International Limited (previously Exide Products
Limited)
1969
Second factory at Chinchwad, Pune
1972
The name of the Company was changed to Chloride India Limited
1976
RandD Centre established at Kolkata
1981
Third factory at Haldia, West Bengal
1988
The name of the Company was changed to Chloride Industries Limited
1994
Technical collaboration with Shin Kobe Electric Machinery Company
Limited of Japan, a subsidiary of the Hitachi
Group.
1995
Chloride Industries Limited renamed Exide Industries Limited
1997
Fourth factory at Hosur, Tamil Nadu
1998
Acquisition of industrial/ manufacturing units of Standard Batteries Ltd
located at Taloja and Kanjurmarg (Maharashtra), Guindy (Tamilnadu) and plant at
Ahmednagar (Maharashtra) from Cosepa Fiscal Industries Limited as a going
concern.
1999
Acquired 51% Shareholding in Caldyne Automatics Limited
2000
Acquisition of 100% stake in Chloride Batteries S E Asia Pte Limited,
Singapore and 49% stake in Associated Battery Manufacturers (Ceylon) Limited,
Sri Lanka.
2003
Commissioned plant at Bawal, Haryana
2003
New joint venture in UK, ESPEX, with 51% holding.
2004
Associated Battery Manufacturers (Ceylon) Limited, Sri Lanka became a
subsidiary consequent to acquiring further 12.50% Equity holding.
2005
Investment in 50% shareholding of ING Vysya Life Insurance Company
Limited
2007
Caldyne Automatics Ltd becomes 100% subsidiary consequent to acquiring
the balance 49% shareholding.
2007
Investment with 26% shareholding.in CEIL Motive Power Pty Limited A
Joint Venture in Australia.
2007
Acquired 100% stake in Tandon Metals Limited
2008
Acquired 51% stake in Lead Age Alloys India Limited
Business
The Company’s predecessor began its operations in 1916 as an import
house called Chloride electrical Storage Company. Since then, over the years,
the Company has been steadily progressing by taking necessary initiatives to
modernize its manufacturing processes and by constantly improving its customer
services.
In the year 1994, the Company had entered into a technical collaboration with
Shin Kobe Electric Machinery Company Limited of Japan, a subsidiary of the
Hitachi Group. The main objective of entering into this collaboration was
accessing technology for the new automotive vehicles entering the Indian
market. Further in the year 1998, with an objective of increasing capacity
without the time lag in setting-up greenfield project the company acquired the
Industrial Undertakings of Standard Batteries Limited as a going concern. This
acquisition strengthened its production base as well as giving the Company
access to technology from The Furukawa Battery Company of Japan.
On the marketing front, with an objective to get a global platform to
expand its business the Company acquired a 100% stake in Caldyne Automatics
Limited in July 2007 and 100% stake in Chloride Batteries S E Asia Pte Limited,
Singapore and 49% stake in Associated Battery Manufacturers (Ceylon) Limited,
Sri Lanka in the year 2001. The stake in Associated Battery Manufacturers
(Ceylon) Limited, Sri Lanka was increased to 61.5% by acquiring additional
12.5% stake in 2004.
The company has also acquired a 51% stake in ESPEX Batteries Limited, U.K.and a
26% shareholding in Ceil Motive Power Pty Limited, Australia. The Company has
also acquired a 100% stake in Tandon Metals Private Limited in October 2007. In
June 2008 the company acquired a 51 per cent stake in Leadage Alloys India
Limited.
Through these continuous innovations and collaborations the Company has
gradually risen to become one of the largest manufacturers and exporters of
batteries in the sub-continent today. The Company manufactures the widest range
of storage batteries in the world from 2.5 Ah to 20400 Ah capacity, covering
the broadest spectrum of applications. As on today, the Company has a domestic
market share of 45% in Industrial, 72% in Auto OE and 73% in replacement auto .
The Company being the domestic storage major, is also one of the largest power
storage solution company in South-East Asia.
On the domestic front, the Company has six factories located across
India – 2 in the states of Maharashtra, 2 in the state of West Bengal, 1 in
state of Tamil Nadu and 1 in the state of Haryana. The Company power most of
the industrial and automotive segments in the country and the products are used
in critical applications in infrastructure and defence sectors.
Automotive Batteries
In the domestic market, the Company sells its products under EXIDE, SF, SONIC and Standard Furukawa Brands.’EXIDE’ and ‘SF” are its flagship brands. In the international market the products are sold mainly under DYNEX, INDEX and SONIC brands. The Company supplies batteries to almost all the car and two-wheeler manufacturers in the country.
The Company has a distribution network comprising over 4000 dealer outlets.
These outlets are supported by 4 regional offices and 28 branch offices. The
Company also exports batteries to the Middle East, Japan and CIS countries.
The Company has a market share of 72% in case of Automotive OEM and 70% in case
of Organized Retail. The Company also manufactures submarine batteries.
Industrial Batteries
The Company designs
and manufacture its industrial batteries in a wide range from 2.5 Ah to 20,600
Ah in conventional flooded and Valve Regulated Lead Acid (VRLA) design. In
domestic market, the Company sell its products mainly under EXIDE, INDEX, SF,
CEIL and POWER SAFE brands and in the international markets mainly under CEIL,
CHLORIDE and INDEX brands.
Industrial batteries
are of three types, Conventional lead acid batteries, VRLA (Valve regulated
lead acid batteries) batteries and Nickel-Cadmium batteries.
Both organized and
unorganized players compete in the OEM and retail industrial battery markets.
Industrial batteries cater mostly to the infrastructure sector such as
railways, telecom, power plants, solar cells and other industrial segments such
as uninterrupted power supply, inverters and traction batteries. Subject’s Inva
tubular batteries for Inverter applications were introduced in 2000 and Tele
tubular for Telecom Sector introduced in the year 2007 has created volume
growth.. The Company also manufacture industrial batteries for niche segments
such as miners’ cap lamp batteries and submarine batteries.
Submarine Batteries
The Company also manufactures high-end submarine batteries (Type 1, 2 and 3). The Company manufactures two to three submarine batteries a year to meet the country’s defence requirements. The Company is one of the five companies in the World which has the capability to make submarine batteries for both Russian and German types. With the government’s permission, in recent years, the Company has exported to Algeria.
Press Releases
Exide reports 25 per
cent rise in net profit in Q2.
Exide Industries Limited, the country’s largest Lead Acid Storage Battery Manufacturers achieved a YOY net profit growth of 25% for the quarter ended September 30, 2008. At its Board Meeting held today, to consider the unaudited results for the three months ended 30 September 2008, the Company reported a net profit of Rs 780 millions as against Rs 620 millions same period of the previous year. The net sales for 3 months of Rs 9010 millions also show a YOY growth of 35%.
For the 6 months of the current financial year 2008 / 09, the net sales of Rs 18070 millions and the net profit of Rs 1600 millions reflected a YOY growth of 36% and 21% respectively.
Commenting on the satisfactory Q2 performance, Exide’s Managing Director and Chief Executive Officer, Mr T.V. Ramanathan said, “proactive steps taken during the last 12 months to secure a portion of raw materials from Secondary Lead indigenously available by acquiring Lead smelting capacities coupled with an improved sales mix has ensured satisfactory growth despite the very challenging economic environment”.
The strong Balance Sheet and the very low Debt Equity Ratio would ensure the Company meet its finance requirements for the ensuing quarters also in a cost effective manner, Mr Ramanathan added .
The recent softening of Lead prices in the international market to some extent has been neutralized by the sharp depreciation of Rupee against the Dollar.
In the Automotive battery segment, the growth in value terms for the six months ended 30 September 2008 is 35%. The lower volume growth in the OE business has been countered by a robust growth in the Replacement Trade sales.
Under the Industrial battery segment, the overall growth in value terms for the half year is 40%. Telecom and Power sectors underpin this value growth. Exide’s traction batteries continued to find ready export markets in the developed economies of Western Europe, South Africa, Korea, Japan and Australia.
Exide net surges 34
per cent, top line grows to Rs 11350 millions
Exide Industries Limited today declared 34 per cent growth in its gross turnover and 17 per cent growth in net profit during the first quarter of the financial year 2008-09, compared to the corresponding quarter of the previous financial year.
The company’s Board met in the city on Thursday evening to adopt the financial results for the quarter April-June 2008.
During the period, Exide Industries Limited’s gross turnover grew to Rs 11350 millions (from Rs 8480 millions during Q1 07-08) and profit after tax grew to Rs 820 millions (from Rs 700 millions during Q1 07-08).
Commenting on the performance, Managing Director and Chief Executive Officer, Mr T.V. Ramanathan, said, “profit growth was affected by the depreciation of the rupee vis-a-vis all major currencies. A depreciating rupee affects profitability since we import a sizeable part of our main raw material Lead. In view of the burgeoning inflation rates, we have to keep a very tight leash on costs over the next three quarters to keep the momentum of the first quarter going.”
If exchange gain / loss arising from Rupee appreciation / depreciation is excluded the growth in profit for the quarter is 40%.
With the automotive segment showing less than buoyant growth rates in some of the segments, the company’s industrial battery business, particularly in telecom and power sectors continued to show robust growth.
The automotive segment is expected to see a lot of excitement in the near future with the planned launches of a slew of new car models by a number of manufacturers. Virtually all these new launches from the auto giants will be powered by Exide batteries, not to speak of the much awaited Nano from the Tata Motors stable half of which will also run on Exide batteries.
During the period the company acquired 51 per cent stake in Leadage Alloys India Limited, a Lead smelting and refining unit located near Bangalore. This is expected to give the company better control over the business of recycling of used Lead acid storage batteries and consequently meet the requirements set forth by the government in its Battery Handling and Management Rules. Its own smelting unit will also help Exide combat the rising Lead prices more effectively.
Exide Industries net profit jumps 61 per
cent to Rs 2500 millions
Highlights of 2007 – 08
·
Turnover rises 51 per cent to Rs 36060 millions
·
Pays 40 per cent dividend and thus maintains uninterrupted dividend
payment track record for 60 years
·
Automotive battery production crosses 608 million plates
·
Industrial battery production crosses 1169 million amp
·
Dedicated facility for export market goes on stream
Exide Industries Limited today announced its annual results for the financial year 2007-08. While gross turnover rose 51 per cent to Rs 36060 millions for the 12 month period, net profit rose 61 per cent to Rs 2500 millions, compared to the previous financial year.
For the fourth quarter (January to March 2008) gross turnover rose from 6720 millions to 10080 millions, registering a growth of 50 per cent. Net profit during the quarter also grew in tandem from 390 millions to 630 millions, recording a growth of 62 per cent.
As a result of strong performance, the Return on Capital Employed (ROCE) and Return on Net Worth(RONW) have improved to 35% and 40% respectively. Debt Equity Ratio has also improved to 0.35:1 at end March 2008.
The Exide Industries Limited Board which met today to adopt and approve the results declared a dividend of 40 per cent, thereby maintaining its record of uninterrupted dividend payment for 60 years.
Commenting on the rise in profitability despite high input costs, particularly lead which accounts for close to 70 per cent of the costs, MD and CEO,Mr T V Ramanathan said, “the wildly fluctuating cost of lead in the international markets remains a cause of concern for us. However, during the year we could successfully introduce the concept of price escalation clause for most of our institutional customers in industrial batteries, which already existed in the automotive OEM segment. This protected us from the fluctuation in lead prices to a large extent.”
During the year 2007-08, Exide Industries Limited also made its maiden foray into the business of lead smelting by acquiring a unit in Maharashtra. “With our own lead smelting unit in place, we are now in a position to have better control on recycling of used batteries which gives us a major edge over the unorganized sector,” Mr Ramanathan said.
“With the economy continuing to grow at the rate of over eight percent, the future of the lead acid storage battery industry looks promising. However, the rising inflation rate is an area of concern. Hopefully the concerted government efforts to rein in the rise in prices will bear fruit soon,” Mr Ramanathan said.
With 62 per cent market share in the organized sector of automotive batteries industry, Exide’s grip on the auto segment remained firm despite growing competition from new entrants.
In industrial battery segment also the company’s market share remained unchallenged. Exide’s growth rate in the telecom sector was particularly noteworthy showing a growth rate of 71 per cent. SBU industrial’s exports grew by 35 per cent.
The production of batteries for industrial applications rose from close to one billion amp to nearly 1.2 billion amp during the year
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 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.49.79 |
|
UK Pound |
1 |
Rs.73.37 |
|
Euro |
1 |
Rs.63.08 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
9 |
|
PAID-UP CAPITAL |
1~10 |
9 |
|
OPERATING SCALE |
1~10 |
9 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
10 |
|
--PROFITABILIRY |
1~10 |
8 |
|
--LIQUIDITY |
1~10 |
9 |
|
--LEVERAGE |
1~10 |
9 |
|
--RESERVES |
1~10 |
9 |
|
--CREDIT LINES |
1~10 |
9 |
|
--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 |
NO |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
81 |
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 & 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. |
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 |
|