MIRA
INFORM REPORT
|
Report Date : |
09.02.2008 |
IDENTIFICATION
DETAILS
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Name : |
MRF LIMITED |
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Registered
Office : |
124 Greames Road,
Chennai – 600 006, Tamilnadu |
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Country : |
India |
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Financials (as
on) : |
30.09.2006 |
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Date of
Incorporation : |
05.11.1960 |
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Com. Reg. No.: |
18-4306 |
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CIN No.: [Company
Identification No.] |
L25111TN1960PLC004306 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
CHEM07088E |
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PAN No.: [Permanent
Account No.] |
AAACM4154G |
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Legal Form : |
A Public Limited
Liability company. The company’s
shares are listed on the Stock Exchanges. |
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Line of
Business : |
Manufacturing and Marketing of automobile
tyres, automobile tubes, tread rubber, pre cured treads, bicycle tyres,
bicycle tubes, rubberised tank tyres & boggie wheels, conveyor belting
and specialty surface coatings. |
RATING &
COMMENTS
|
MIRA’s Rating
: |
Aa |
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 32000000 |
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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,
reputed and respectable company having fine track. Available information
indicates high financial responsibility of the company and its’ directors.
Fundamentals are strong and healthy. Market reputation is favourable. The
company is progressing exceedingly well. Its’ payments are always correct and
as per commitments. The company can
be considered good for any normal business dealings. |
LOCATIONS
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Registered
Office : |
124 Greames Road,
Chennai – 600 006, Tamilnadu, India |
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Tel. No.: |
91-44-28292777 |
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Fax No.: |
91-44-28295087/28294089 |
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E-Mail : |
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Website : |
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Overseas Office : |
v P.O. Box 626871, Al Maktoum Hospital Road, Deira, Dubai, UAE Tel. 91-04-2239657 Fax. 91-04-2239660 E-mail. mrfdubai@emirates.net.ae Contact Person - Biju Abraham Thomas,
General v 1764, Calvert Drive, Cuyahoga Falls, OHIO 44223 USA Tel. 91-001-330-9291594 Res. 91-001-330-9283096 Fax. 91-001-330-9290306 E-mail. jkillian@neo.rr.com |
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Factory 1 : |
v Tiruvottiyur, Chennai, Tamilnadu, India v Vadavathoor, Kottayam Kerala, India v Usgao, Ponda, Goa, India v Icchiputhur, Arakonam, Tamilnadu, India v Sadasivapet, Medak, Andhra Pradesh, India v Eripakkam Village, Nettapakkam Commune,
Pondicherry, India v Sipcot Industrial Complex, Gummidipoondi,
Tamilnadu, India |
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Office : |
C – 79, Ground
Floor, Okhla Industrial Area, Phase – I, Delhi E-mail : mrfpaint.del@gnmds.global.ems.vsnl.net.in No. 2, Ground
Floor, Plot No. 374, Build Arch Terrace, Sitla Devi Temple Road, Mahim Tel. No.
91-22-24463565 E-mail : mrfpaint.bby@gnbom.globalnet.ems.vsnl.net.in Tarapore Towers,
Fifth Floor, 826, Anna Salai, Chennai, Tamilnadu, India E-mail : mrfpaint.mds@gnmds.globalnet.ems.vsnl.net.in No. 2, New
Taratolla Road, Kolkata, West Bengal, India Tel. No. :
91-33-24589830 |
DIRECTORS
|
Name : |
Mr. K. M. Mammen |
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Designation : |
Chairman & Managing Director |
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Age: |
53 Years |
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Qualification
: |
B. A. |
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Experience : |
29 Years |
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Date of
Joining : |
01.06.1985 |
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Previous
Employment : |
Devon Machines (Private) Limited |
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Name : |
Mr. Arun Mammen |
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Designation : |
Joint Managing Director |
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Name : |
Mr. K. M. Philip |
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Designation : |
Whole-time Director |
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Age : |
65 Years |
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Qualification
: |
B.A. |
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Experience : |
44 Years |
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Date of
Joining : |
05.11.1960 |
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Name : |
Dr. K. C. Mammen |
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Designation : |
Director |
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Name : |
Mr. K. D. Parakh |
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Designation : |
Director |
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Name : |
Mr. Ashok Jacob |
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Designation : |
Director |
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Name : |
Mr. S. Nandagopal |
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Designation : |
Director |
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Name : |
Mr. V. Sridhar |
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Designation : |
Director |
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Name : |
Mr. Vijay R.
Kirloskar |
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Designation : |
Director |
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Name : |
Mr. N. Kumar |
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Designation : |
Director |
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Name : |
Mr. Ranjit I.
Jesudasen |
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Designation : |
Director |
KEY EXECUTIVES
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Name : |
Mr. D. M. Choksi |
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Designation : |
Company Secretary |
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Name : |
Mr. Ravi Mannath |
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Designation : |
Additional Company Secretary |
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Name : |
Mr. Kurian and
Kurian |
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Designation : |
Legal Advisors |
BUSINESS DETAILS
|
Line of Business
: |
Manufacturing and Marketing of automobile
tyres, automobile tubes, tread rubber, pre cured treads, bicycle tyres,
bicycle tubes, rubberised tank tyres & boggie wheels, conveyor belting
and speciality surface coatings. |
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Products : |
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Imports from : |
Europe and Far
East |
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Terms : |
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Purchasing : |
L/C and Credit
terms |
PRODUCTION STATUS
|
PARTICULARS |
Unit |
Licensed
Capacity |
Installed
Capacity |
Actual
Production |
|
Automobile Tyres |
Nos. |
@ |
19772000 |
17596948 |
|
Automobile Tubes |
Nos. |
@ |
18600000 |
16052918 |
|
Tread Rubber |
MT |
7,946 |
8,943 |
1548 |
|
Pre-cured Treads |
MT |
@ |
24,000 |
5971 |
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Bicycle Tyres |
Nos. |
20,00,000 |
20,00,000 |
-- |
|
Bicycle Tubes |
Nos. |
20,00,000 |
20,00,000 |
-- |
|
Rubberised Tank
Tyres & Boggie Wheels |
Nos. |
15,000 |
15,000 |
-- |
|
Conveyor Belting |
MT |
@ |
3,000 |
2778 |
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Specialty Surface
Coatings |
KL |
@ |
2,000 |
2114 |
GENERAL
INFORMATION
|
No. of
Employees : |
9556 |
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Bankers : |
v State Bank of India, Madame Cama Road,
Mumbai v
Syndicate
Bank |
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Facilities : |
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Banking Relations : |
Satisfactory |
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Auditors : |
v Sastri & Shah Chartered Accountants Chennai, Tamilnadu v M. M. Nissim & Company Chartered Accountants Mumbai, Maharashtra |
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Associate : |
v Tiruvottiyur, Chennai, Tamilnadu, India v Vadavathoor, Kottayam Kerala, India v Usgao, Ponda, Goa, India v Icchiputhur, Arakonam, Tamilnadu, India v Sadasivapet, Medak, Andhra Pradesh, India v Eripakkam Village, Nettapakkam Commune,
Pondicherry, India v
Sipcot
Industrial Complex, Gummidipoondi, Tamilnadu, India |
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Subsidiaries: |
v Funskool (India) Limited v MRF Corporation Limited v MRF International Limited |
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Membership : |
v Confederation of Indian Industry |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
9000000 |
Equity Shares |
Rs.10/- each |
Rs. 90.000 millions |
|
100000 |
Taxable Redeemable Cumulative Preference Shares |
Rs.100/- each |
Rs. 10.000 millions |
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GRAND TOTAL |
|
Rs.100.000 millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
4241143 |
Equity Shares |
Rs.10/- each |
Rs. 42.411 millions |
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES
OF FUNDS |
30.09.2006 |
30.09.2005 |
30.09.2004 |
|
SHAREHOLDERS FUNDS |
|
|
|
|
1] Share Capital |
42.400 |
42.400 |
42.400 |
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2] Reserves & Surplus |
8200.500 |
7498.100 |
7191.700 |
|
NET WORHT |
8242.900 |
7540.500 |
7234.100 |
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LOAN FUNDS |
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|
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|
1] Secured Loans |
2436.800 |
2995.700 |
1663.200 |
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2] Unsecured Loans |
4851.800 |
4103.900 |
3940.400 |
|
TOTAL
BORROWING |
7288.600 |
7099.600 |
5603.600 |
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|
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TOTAL
|
15531.500 |
14640.100 |
12837.700 |
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APPLICATION OF FUNDS |
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|
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FIXED ASSETS [Net Block] |
6496.700 |
5368.100 |
4192.200 |
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Capital work-in-progress |
662.600 |
1519.900 |
1240.100 |
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INVESTMENTS |
702.300 |
137.500 |
762.100 |
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Deferred Tax Assets |
0.000 |
16.300 |
36.600 |
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CURRENT ASSETS, LOANS & ADVANCES |
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|
|
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Interest Accrued on investment |
0.000 |
0.600 |
0.600 |
|
Inventories |
5656.300 |
5535.600 |
4820.400 |
|
Sundry Debtors |
5393.600 |
4623.400 |
3983.600 |
|
Cash & Bank Balances |
533.200 |
460.200 |
367.200 |
|
Other Current Assets |
0.000 |
2.100 |
1.600 |
|
Loans & Advances |
1385.100 |
1120.000 |
1364.200 |
|
Total Current Assets |
12968.200 |
11741.900 |
10537.600 |
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Less : |
|
|
|
|
Current Liabilities |
4564.800 |
3205.800 |
2924.000 |
Provisions
|
733.500 |
937.800 |
1006.900 |
Total Current Liabilities
|
5298.300 |
4143.600 |
3930.900 |
|
Net Current Assets |
7669.900 |
7598.300 |
6606.700 |
|
|
|
|
|
|
Miscellaneous Expenses |
0.000 |
0.000 |
0.000 |
|
|
|
|
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TOTAL
|
15531.500 |
14640.100 |
12837.700 |
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
30.09.2006 |
30.09.2005 |
30.09.2004 |
|
|
Sales Turnover |
42336.600 |
34371.300 |
29932.400 |
|
|
Other Income |
524.300 |
892.500 |
837.200 |
|
|
Total Income |
42860.900 |
35263.800 |
30769.600 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
998.100 |
553.400 |
429.000 |
|
|
Provision for Taxation |
199.000 |
150.300 |
141.000 |
|
|
Profit/(Loss) After Tax |
799.100 |
403.100 |
288.000 |
|
|
|
|
|
|
|
|
Total Earnings |
5025.500 |
4265.700 |
NA |
|
|
|
|
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|
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Expenditures : |
|
|
|
|
|
|
Manufacturing Expenses |
1107.600 |
911.900 |
713.900 |
|
|
Administrative Expenses |
3183.800 |
2869.300 |
2629.800 |
|
|
Raw Material Consumed |
26151.200 |
21255.900 |
17356.000 |
|
|
Miscellaneous Expenses |
267.200 |
141.700 |
613.600 |
|
|
Salaries, Wages, Bonus, etc. |
1961.800 |
1702.400 |
1583.200 |
|
|
Interest |
492.700 |
406.000 |
281.500 |
|
|
Power & Fuel |
2150.400 |
1804.500 |
1607.800 |
|
|
Depreciation & Amortization |
1456.600 |
1103.200 |
958.800 |
|
|
Other Expenditure |
5091.500 |
4515.500 |
4596.000 |
|
Total
Expenditure |
41862.800 |
34710.400 |
30340.600 |
|
SUMMARISED RESULTS
|
PARTICULARS |
|
|
30.09.2007 |
|
Type |
|
|
Full
Year |
|
Sales Turnover |
|
|
44110.000 |
|
Other Income |
|
|
197.200 |
|
Total Income |
|
|
44307.200 |
|
Total Expenditure |
|
|
39671.100 |
|
Operating Profit |
|
|
4636.100 |
|
Interest |
|
|
492.400 |
|
Gross Profit |
|
|
4143.700 |
|
Depreciation |
|
|
1534.100 |
|
Tax |
|
|
891.800 |
|
Reported PAT |
|
|
1717.800 |
|
Dividend (%) |
|
|
2000.000 |
QUARTERLY RESULTS
|
PARTICULARS |
|
|
31.12.2007 [1st Quarter.] |
|
Sales Turnover |
|
|
11555.700 |
|
Other Income |
|
|
53.100 |
|
Total Income |
|
|
11608.800 |
|
Total Expenditure |
|
|
10329.600 |
|
Operating Profit |
|
|
1279.200 |
|
Interest |
|
|
136.200 |
|
Gross Profit |
|
|
1143.000 |
|
Depreciation |
|
|
349.100 |
|
Tax |
|
|
276.400 |
|
Reported PAT |
|
|
517.500 |
KEY RATIOS
|
PARTICULARS |
30.09.2006 |
30.09.2005 |
30.09.2004 |
|
Debt-Equity Ratio |
0.91 |
0.86 |
0.72 |
|
Long Term Debt-Equity Ratio |
0.56 |
0.51 |
0.45 |
|
Current Ratio |
1.64 |
1.68 |
1.83 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
2.40 |
2.26 |
2.21 |
|
Inventory |
7.57 |
6.64 |
6.76 |
|
Debtors |
8.45 |
7.99 |
7.53 |
|
Interest Cover Ratio |
2.27 |
1.89 |
3.91 |
|
Operating Profit Margin(%) |
6.08 |
5.44 |
6.88 |
|
Profit Before Interest And Tax Margin(%) |
2.64 |
2.23 |
3.68 |
|
Cash Profit Margin(%) |
4.61 |
3.96 |
5.04 |
|
Adjusted Net Profit Margin(%) |
1.16 |
0.75 |
1.84 |
|
Return On Capital Employed(%) |
7.40 |
5.57 |
8.95 |
|
Return On Net Worth(%) |
6.25 |
3.47 |
7.70 |
LOCAL AGENCY
FURTHER INFORMATION
History
MRF Limited, incorporated in 1960 to take over the business of
the Madras Rubber Factory, MRF later went public in 1961. The company has its
works at Chennai, Arakkonam, Medak, Kottayam, Pondicherry, Gummidipoondi and
Goa. All MRF plants were accredited with ISO-14001 and its corporate funtions
have been certified ISO-9001-2000 for its quality management.
The company manufactures tyres and tubes in collaboration with Mansfield Tyres
and Rubber, US. Its products include Nylogrip, Zigma, Tyredrome, etc. Its
subsidiary companies are MRF Corp and MRF International. The company tyres are
being exported to 75 countries worldwide.
MRF diversified into conveyor belts in collaboration with Pierelli, Italy, and
in 1991-92, tied up with Vapocure, Australia, to manufacture polyurethane paint
formulations and later into tyre machines in collaboration with Abex, US. It
also diversified into speciality surface coatings, conveyor belts and leather.
It has launched a steel-belted premium radial tyre variant called MRF ZVTS'.
While this tyre augments the company's overall range of radials, it also marks
a step forward in terms of technology, performance and superior ride quality.
It has become an original equipment supplier(OES) of radial tyres to Tata
Indica.
Volvo, the only MNC which has entered the truck market in India, is sourcing
most of its tyre requirements from MRF.
MRF was declared the most ethical company by 'Business Magazine' in its survey
in 1999.
The Company's speciality coatings has launched MRF Durothane, an economical,
multi-purpose, 100% polyurethane for metal, wood and plastic surfaces in 2004.
Further the company ha launched MRF Cento, an elegant 100% polyurethane finish
for wood surface, both interior and exterior and this is available in both
glossy and matte finishes.
During 2004-2005, the companies expanded its reach by exporting its products to
countries like Finland, Canada and Turkey. MRF commenced export of Motor Sport
Tyres. The company also exported MRF Pre-Treads Bangladesh, Fiji and a few
other countries. A company MRF Lanka (Private) was incorporated in Srilanka for
the manufacture of Pre-treads and other related products during this period.
The company also expanded its capacity of Automobile Tyres and Automobile Tubes
from 17372000 Nos to 19772000 Nos and from 16000000 Nos to 18600000 Nos
respectively during this period.
Volvo, the only MNC which has entered the truck market in India, is sourcing
most of its tyre requirements from the company.
1946
A young entrepreneur, K. M.
Mammen Mappillai, opened a small toy balloon manufacturing unit in a shed at
Tiruvottiyur, Madras (now Chennai).
1949
Although the "factory"
was just a small shed without any machines, a variety of products, ranging from
balloons and latex-cast squeaking toys to industrial gloves and contraceptives,
were produced. During this time, MRF established its first office at 334,
Thambu Chetty Street, Madras (now Chennai), Tamil Nadu, India.
1952
MRF ventured into the
manufacture of tread rubber. And with that, the first machine, a rubber mill,
was installed at the factory. This step into tread-rubber manufacture, was
later to catapult MRF into a league that few had imagined possible.
1955
MRF soon became the only
Indian-owned unit to manufacture the superior extruded, non-blooming and
cushion-backed tread-rubber, enabling it to compete with the MNC's operating in
India at that time.
1956
The quality of the product
manufactured was of such a high standard that by the close of 1956, MRF had
become the market leader with a 50% share of the tread-rubber market in India.
So effective was MRF's hold on the market, that the large multinationals had no
other option but to gradually withdraw from the tread rubber business in India.
1961
With the success achieved in tread
rubber, MRF entered into the manufacture of tyres. MRF established a technical
collaboration with the Mansfield Tire & Rubber Company of USA. Around the
same time, it also became a public company. It set up a pilot plant for tyre
manufacture at Tiruvottiyur, Madras (now Chennai).
1963
On June 12, 1963, India's first
Prime Minister, Late Pandit Jawaharlal Nehru laid the foundation stone for the
Rubber Research Centre at Tiruvottiyur to commemorate the inauguration of the
Tiruvottiyur factory.
1964
With the commissioning of the
main plant in 1964, MRF also made progress in the export of tyres. An overseas
office at Beirut (Lebanon) was established to develop the export market, and it
was amongst India's very first efforts on tyre exports. This year also marked
the birth of the now famous MRF Muscleman.
1967
MRF became the first Indian
company to export tyres to USA - the very birthplace of tyre technology.
1973
MRF scored a major breakthrough
by being among the very first in India to manufacture and market Nylon tyres
passenger tyres commercially.
1978
MRF developed the MRF
Superlug-78, a sturdy tyre for heavy-duty trucks. The tyre was a significant
improvement over its existing products, and went on to become the country's
largest selling truck tyre in later years.
1979
MRF's turnover crossed INR one
billion.
1980
MRF
entered into a technical collaboration with the B.F. Goodrich Tyre Company of
USA, which was involved with the development of tyres for the NASA
space-shuttle. With this began a significant exercise in quality improvement
and new product development.
MRF
took a major policy decision to be aggressive on the racing circuits.
1983
MRF began a rapid product
development programme for new vehicles entering India.
1984
Sales crossed INR two billion.
MRF tyres were the first tyres selected for fitment onto the Maruti Suzuki 800
- India's first small, modern car.
1985
MRF Nylogrip tyres for
two-wheeler vehicles were launched.
1986
MRF was selected by the National
Institution of Quality Assurance for their most prestigious award. Pitted
against 20 tyre companies worldwide, MRF also won 6 Quality Improvement Awards
instituted by the B.F. Goodrich Tyre Company from USA.
1987
MRF crossed the INR three
billion mark and also became the No. 1 tyre company in India. MRF Legend, the
premium nylon car tyre was introduced.
1988
The MRF Pace Foundation was set
up, with international pace bowler, Dennis Lillee as its Director. Not long thereafter,
pace bowlers trained at the Foundation were selected for the Indian Cricket
Team.
1989
By 1989, MRF was the clear
market leader in every tyre segment. Once again, in recognition of excellence,
MRF was awarded the Visvesvaraya Award for the Best Business House in South
India and the Economic Times Harvard Business School Award for the Best
Corporate Performance. MRF collaborated with Hasbro International USA, the
world's largest toy makers, and launched Funskool India. The company also
entered into collaborations with Vapocure, Australia to manufacture
polyurethane paint formulations and with Pirelli for MUSCLEFLEX Conveyor &
Elevator Belting.
1989
MRF launched the MRF ZIGMA CC
Radial synchronising with the MRF World Series Cricket Tournament for the
Jawaharlal Nehru Trophy sponsored by the company. The Chief Minister of Tamil
Nadu, Dr. M. Karunanidhi, awarded MRF the Special Export Award. MRF also opened
the MRF Tyredrome, India's first tyre company-owned wheel care complex at
Madras (now Chennai).
1990
MRF brought the 6th World Cup
Boxing Championship to Mumbai - the first of its kind - with 39 countries
participating. The event was telecast live on TV networks worldwide.
1993
K. M. Mammen Mappillai was
awarded the Padmashri Award of National Recognition for his contribution to
industry - the only industrialist from South India to be accorded this honour
until that time. MRF also became the first tyre company in India to cross the
INR 10 billion mark. In addition, the company was voted by the Far Eastern
Economic Review, as one of the ten leading Corporate Groups in India and a
Leader in Asia.
MRF was selected as one of
India's most admired Marketing Companies by the readers of the
A & M magazine.
1995
The company's turnover crossed
INR 15 billion. MRF was chosen for fitment on the Daewoo Cielo. This year too
MRF was voted by the Far Eastern Economic Review as one of the 10 leading
Indian Companies.
1996
In the Golden Jubilee year,
MRF's turnover crossed the INR 20 billion milestone. A special factory
dedicated entirely to the manufacture of radials was started at Pondicherry.
MRF Tyres were also chosen for fitment on the Ford Escort, Opel Astra and Fiat
Uno. Further proof of its superior quality.
1999
MRF was declared the most
ethical company by "Business World" magazine in its survey.
2000
MRF launched the Smile campaign
on Indian roads.
2004
MRF's turnover crossed INR 30 billion mark
Total Income
4260.73, 3482.09 Profit before tax and exceptional Items 63.40 59.52
Add/[Less]: Exceptional Items 36.41* (4.78) Profit before Taxation 99.81
55.34Provision for Taxation 19.90 15.03Net Profit 79.91 40.31
Purchase tax provision written back/sales tax refunds due for earlier years on
account of a favourable judicial decision.
Despite unprecedented increase in cost of raw materials, immense competition in
the industry with prices and discounts posing a challenge in passing on the
increase in the cost to the customers, the company has achieved satisfactory
results last year due to cost cutting measures undertaken over a period of
time.
Two interim dividends of 30% each for the year ended 30th September, 2006 were
declared by the Board of Directors on 20-07-2006 and on 30-10-2006. The
Directors now recommend to the Annual General Meeting the declaration of final
dividend of 140% for the year ended 30-09-2006. With this, the total dividend
for the entire year works out to 200%. The total amount of dividends aggregates
to Rs.84.8 Millions.
The Directors recommend that after making provision for taxation and proposed
dividend, the amount of Rs.702.4 Millions be transferred to General Reserve.
With this, the company's reserves and surplus stand at Rs.8200.5
Millions.
Industrial Relations:
The overall industrial relations in all their manufacturing plants were cordial
and harmonious throughout the year and the production and productivity were
maintained at the desired levels.
The Management Discussion and Analysis gives an overview of the developments in
human resources/industrial relations during the year.
Exports:
Company's exports
for the year ended 30th September, 2006 were at Rs.502.55 Millions as against
Rs.4265.7 Millions for the previous year which works out to an increase of
almost 18% over the previous year.
This growth has come about by increasing coverage of existing markets as well
as adding new markets to which the entire range of MRF products are
exported.
With MRF's offices located in Dubai, Vietnam, Dhaka and Australia, marketing
strategies are initiated to maximize market share.
The sale of Conveyor belting has shown excellent growth with sales to most of
the major markets in Australia, Europe and South America.
An ambitious target has been set for the year to come and focus markets have
been identified. Strategies to achieve a dominant market share are in place in
each of these focus markets.
Prospects for the Current Year:
The rising prices of raw materials such as natural rubber, oil and oil
derivatives which are used in the tyre manufacture have been the key concern
for the tyre industry. Currently, the trend of raw material prices is very
volatile. Since the tyre industry is highly competitive and price sensitive, it
is unable to pass on completely the increase in raw material costs to its
customers.
Despite the above, the company hopes to record satisfactory results on account
of MRF's high brand preference and customer's trust in the MRF products.
Directors' Responsibility
Statement:
In compliance with the provisions of Section 217(2AA) of the Companies Act,
1956, the Directors confirm that:
In the preparation of the annual accounts, the applicable accounting standards
have been followed and that there are no material departures;
They have, in selection of the accounting policies, consulted in the statutory
auditors and applied them consistently making judgements and estimates that are
reasonable and prudent so as to give a true and fair view of the state of
affairs of company at the end of the financial year and of the profit of the
company for that period;
Proper and sufficient care has been taken for the maintenance of adequate
accounting records in accordance with provisions of the Act for safeguarding
the assets of the company and for preventing and detecting fraud and other
irregularities; and
The annual accounts
have been prepared on a going concern basis.
Future plan of Action:
Newer models of passenger cars are continuously launched by the multinational
automotive industries and R & D efforts are taken to meet their stringent
requirements. Priority is being given to develop tyres with lower rolling
resistance, higher speed capabilities and improved fuel efficiency. Efforts are
taken to equip with additional testing facilities to meet the specific customer
requirements.
Special attention will also be given to develop products such as tyres, PCTR
and Conveyor belting, for the export market, meeting the global standards of
quality and performance.
With the development of golden quadrilateral highways connecting all
metropolitan cities, a tremendous growth in the road transport is expected. All
efforts are taken to develop high performance truck tyres for these operating
conditions. Installation and utilization of high. precision manufacturing
equipments are planned to achieve the narrow tolerances required, particularly
in radial tyres.
Efforts are also on in developing environmental friendly raw materials to meet
certain global requirements on pollution.
INDUSTRY STRUCTURE & DEVELOPMENT:
The tyre industry consists
of major tyre companies producing truck tyres and other range of tyres and
certain smaller companies making only non truck tyres. The market for tyre is
primarily driven by the Vehicle Manufacturers whose growth determines the
market size.
Among the Truck manufacturers, Tata Motors and Ashok Leyland lead with Volvo,
Eicher Motors, Force Motors, etc., coming into the market in recent times The
market is undergoing a change since multi axle vehicles are more in demand and
the manufacturers are accordingly changing their product mix.
Other than Truck, major growth has been witnessed in Passenger Cars, which is
going through a buoyant period. Tractors also have witnessed remarkable growth
in recent times while Light Motorcycle production continues to grow year on
year.
One of the major factors affecting tyre industry last year has been the
unprecedented rise in the price of raw materials particularly natural rubber
rising from Rs.65 to Rs.120 per kg in a matter of months. This has created
major shocks in costs and prices of tyres. Rubber price has mellowed slightly
lately though it is still ruling high.
EXPORTS:
The margins on exports were
under pressure during the current year due to the unprecedented increase in the
prices of raw materials. Over a period of time, corrections were made and the
outlook on the export front for the next year is quite positive.
The Company achieved an Export turnover of Rs.502.55 Millions during the year
2005-06 as against Rs.426.57 Millions in 2004-05. This represents a growth of
18% over the previous year. This performance was possible by increasing
coverage of existing markets as well as adding new markets to which the entire
range of MRF products are exported.
The Company has received the 'Highest Export Award' from CAPEXIL and the 'Top
Export Award' from AIRIA during the year.
NON TYRE ACTIVITIES:
Conveyor
Belts:
The demand was
quite buoyant from the export market as there is an appreciation for the quality
of the conveyor belting that they manufacture and export. The sale of conveyor
belting has shown excellent growth with sales to most of the major markets in
Australia, Europe and South America. The export turnover for conveyor belts has
gone up from Rs.78.4 Millions in 2004-05 to Rs.205.3 Millions in 2005-06. The
outlook for export of conveyor belting to different parts of the world is quite
promising in the time to come.
Speciality Coatings:
The Speciality Coatings division achieved a turnover of Rs.384.8 Millions in
2005-06 as against Rs.392.8 Millions in 2004-05. During the year, the
disruption in operation in Gummidipoondi factory continued and manufacturing
was done by out-processing. The margins were affected due to sharp increase in
the cost of raw materials.
They expect to add additional manufacturing facility during 2006-07 and expect
to come back to earlier growth rates during the year 2007-08.
PERFORMANCE OF THE COMPANY:
The sales turnover of the Company during the year increased by 33.17% from
Rs.34371.3 Millions in 2004-05 to Rs.42336.6 Millions in 2005-06. Earnings
before depreciation and interest [EBIDTA] amounted to Rs.2583.3 Millions
against Rs.2025.0 Millions in the provisions year. After providing for
depreciation, interest and income tax, the net profit for the year was Rs.799.1
Millions (after adjusting exceptional items) as compared to Rs.403.1 Millions
(after exceptional items) in the previous year.
AWARDS
RECEIVED DURING THE YEAR:
The Company has received the Top Export Award from AIRIA and Special Export
Award from CAPEXIL for the year 2003-2004.
The company imports
raw materials, components & spares parts and capital goods.
It is in trade
terms with:-
v R. Mendez & Sons
v Span Chemicals
v Rotomech Industry
v Continental Equipment India Private Limited
v Aristo Packers Private Limited
v Noble Synthetics Limited
v Blue Bell Polymers
v Synthetic & Polymers
v Gopal Metal Containers
v SPGC Metal Industries Private Limited
v Laffans Petro Chemicals Limited
v Raveshia Pigments Limited
v Insap Engineers Private Limited
Fixed
Assets :
Land and Building,
Plant and Machinery, Moulds, Vehicles
|
AUDITED
FINANCIAL RESULTS FOR THE YEAR ENDED 30th SEPTEMBER, 2006 [Rs in Millions] |
CONSOLIDATED
FINANCIAL RESULTS |
|||
|
|
9 Months |
3 Months |
Year ended |
Year ended 30.09.06 |
|
|
|
|
|
|
|
|
30536.800 |
11946.300 |
8933.700 |
42484.100 |
|
Less: Excise Duty |
3621.300 |
1473.300 |
1064.200 |
5094.600 |
|
Other Income |
63.200 |
61.000 |
126.200 |
123.400 |
|
Total Expenditure |
|
|
|
|
|
a) (Increase)/Decrease in stock in trade |
57.200 |
50.200 |
(179.500) |
106.400 |
|
b) Consumption of raw materials |
18711.500 |
7439.700 |
5832.100 |
26152.900 |
|
c) Staff Cost |
1436.100 |
565.200 |
457.900 |
2002.400 |
|
d) Other Expenditure |
4936.100 |
1737.400 |
1571.400 |
6671.600 |
|
Interest |
363.200 |
129.500 |
94.800 |
492.900 |
|
Depreciation |
1043.300 |
413.300 |
319.100 |
1457.300 |
|
Profit before tax (1+2-3-4-5) |
435.300 |
198.700 |
199.900 |
629.400 |
|
Add/(Deduct): Exceptional Item |
-- |
364.100 |
(41.800) |
364.100 |
|
Profit Before Taxation |
435.300 |
562.800 |
158.100 |
993.500 |
|
Provision for Taxation (including Fringe Benefit Tax and Net of Deferred Tax) |
156.000 |
43.000 |
44.600 |
200.500 |
|
Net Profit (8-9) |
279.300 |
519.800 |
113.500 |
793.000 |
|
Paid-up Equity Share Capital (Face Value of Rs.10/- each) |
42.400 |
42.400 |
42.400 |
42.400 |
|
Reserves Excluding revaluation reserves |
-- |
-- |
|
8200.300 |
|
Basic and diluted EPS for the period |
Rs. 65.85 |
Rs. 122.56 |
Rs.56.77 |
Rs.186.98 |
|
Aggregate of non-promoter shareholding - |
|
|
|
|
|
No. of Shares |
3120129 |
3121679 |
3132168 |
3121679 |
|
% of Shareholding |
73.57 % |
73.61 % |
73.85% |
73.61% |
|
SEGMENTWISE REVENUE, RESULTS AND CAPITAL
EMPLOYED [Rs in Millions] |
CONSOLIDATED
FINANCIAL RESULTS |
|||
|
|
9 Months |
3 Months |
Year ended |
Year ended 30.09.06 |
|
|
|
|
|
|
|
(a) Rubber Products |
26662.700 |
10464.200 |
37126.900 |
26152.900 |
|
(b) Others |
316.000 |
69.800 |
385.800 |
386.400 |
|
Total |
26978.700 |
10534.000 |
37512.700 |
37512.900 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Rubber Products |
753.000 |
336.100 |
1089.100 |
1084.100 |
|
(b) Others |
45.500 |
[7.900] |
37.600 |
38.200 |
|
(c) Exceptional Item |
-- |
364.100 |
364.100 |
364.000 |
|
|
|
|
|
|
|
Total |
798.500 |
692.300 |
1490.800 |
1486.400 |
|
Less: Other Unallocable, |
363.200 |
129.500 |
492.700 |
492.900 |
|
|
|
|
|
|
|
Total Profit Before Tax |
435.300 |
562.800 |
998.100 |
993.500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Rubber Products |
|
|
14897.000 |
14886.900 |
|
(b) Others |
|
|
136.700 |
150.500 |
|
|
|
|
|
|
|
Total |
|
|
15036.700 |
1503.7400 |
Notes:
The above financial
results which were reviewed by the Audit Committee, was taken on record by the
Board of Directors at their Meeting held on 20th December, 2006.
The Board has
recommended a Final dividend of 140 % for the year ended 30.09.2005, which
along with the two interim dividends of 30% each already paid, works out to
200%.
Provision for
Taxation has been made in respect of Income presently determined, subject to
appropriate revision/adjustment on final determination of Income for the year.
Details of Number of
Investor Complaints for the quarter ended 30.09.2006 - beginning-0, received-5,
disposed of-5.
Figures have been
regrouped wherever necessary.
UNAUDITED FINANCIAL RESULTS FOR THE THREE MONTHS ENDED 31ST
DECEMBER, 2007
Rs in
Millions
|
PARTICULARS |
Quarter Ended |
Previous Accounting
|
|
|
31.12.2007 |
31.12.2006 |
||
|
1 Gross Sales/Income from operations (Including Export Incentive) |
13116.500 |
12079.300 |
50412.000 |
|
Less: Excise Duty |
1560.800 |
1501.000 |
6302.000 |
|
Net Sales / Income from operations |
11555.700 |
10578.300 |
44110.000 |
|
2 Other Income |
53.100 |
37.800 |
197.200 |
|
3 Total Income (1+2) |
11608.800 |
10616.100 |
44307.200 |
|
4 Total Expenditure |
|
|
|
|
a) (Increase)/Decrease in stock in trade and work in progress |
414.600 |
[161.500] |
[634.300] |
|
b) Consumption of raw materials |
7335.800 |
7466.300 |
30312.200 |
|
c) Purchase of traded goods |
22.700 |
26.600 |
170.800 |
|
d) Staff Cost |
597.100 |
539.000 |
2400.200 |
|
e) Depreciation |
349.100 |
347.400 |
1534.100 |
|
f) Other Expenditure |
1959.400 |
1855.700 |
7422.200 |
|
Total |
10678.700 |
10073.500 |
41205.200 |
|
5 Interest |
136.200 |
111.200 |
492.400 |
|
6 Profit before tax (3) - (4+5) |
793.900 |
431.400 |
2609.600 |
|
7 Provision for Tax |
276.400 |
141.800 |
891.800 |
|
8 Net Profit after Tax (6-7) |
517.500 |
289.600 |
1717.800 |
|
9 Paid-up Equity Share Capital (Face Value of Rs.10/- each) |
42.400 |
42.400 |
42.400 |
|
10 Reserves Excluding revaluation reserves |
-- |
-- |
9819.100 |
|
11 Earning per Share (EPS) |
|
|
|
|
Basic and diluted EPS (Rs. per Share) |
1220.300 |
682.800 |
4050.500 |
|
12 Public Shareholding |
|
|
|
|
No. of Shares |
3115698 |
3122090 |
3113119 |
|
% of Shareholding |
73.46% |
73.63 % |
73.40 % |
Notes:
1. The above results have been subjected to Limited Review
by the Statutory Auditors, reviewed by the Audit Committee and approved by the
Board of Directors at its meeting on 31st January, 2008.
2. Provision for Taxation has been made in respect of Income
presently determined, subject to appropriate revision / adjustment on final
determination of Income for the Relevant Previous Year as per Income Tax Act.
3. In pursuance of the provisions of the Accounting Standard
17 concerning Segment Reporting issued by the Institute of Chartered
Accountants of India, Rubber Products and Others reported by the Company in
earlier periods as two segments, have been grouped together as the only
business segment in which the company operates.
4. The company had declared a token lock out for one day on
30.11.2007 at its Tiruvottiyur Factory in Chennai and thereafter since there
was no change in the situation, lock out was declared at the said factory from
3.12.2007 which is still continuing.
5. Figures have been regrouped wherever necessary.
6. Details of Number of Investor complaints for the quarter ended 31.12.2007 - Beginning - 0, Received - 1, Disposed of - 1.
FINANCIALS - Five Years Financial Summary
|
(Rs. in
Millions) |
2007 |
2006 |
2005 |
2004 |
2003 |
|
Sales |
50367.500 |
42336.600 |
34371.300 |
29894.300 |
25419.700 |
|
Other Income |
241.700 |
270.700 |
449.600 |
585.400 |
657.100 |
|
Total Income |
50609.200 |
42607.300 |
34820.900 |
30479.700 |
26076.800 |
|
Profit Before
Taxation |
2609.600 |
998.100 |
553.400 |
429.000 |
1677.500 |
|
Provision for
Taxation |
891.800 |
199.000 |
150.300 |
141.000 |
503.700 |
|
Profit after
Taxation |
1717.800 |
799.100 |
403.100 |
288.000 |
1173.800 |
|
Share Capital |
42.400 |
42.400 |
42.400 |
42.400 |
42.400 |
|
Reserves |
9819.100 |
8200.500 |
7498.100 |
7191.700 |
6999.600 |
|
Net Worth |
9861.500 |
8242.900 |
7540.500 |
7234.100 |
7042.000 |
|
Fixed Assets
Gross |
22897.700 |
19559.900 |
17878.500 |
15344.700 |
13488.000 |
CMT REPORT
(Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts, India Prisons Service,
Interpol, etc.
1] INFORMATION ON DESIGNATED
PARTY
No records exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is or
was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No available
information exist that suggest that subject or any of its principals have been
formally charged or convicted by a competent governmental authority for any
financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE
GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE
RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.40.36 |
|
UK Pound |
1 |
Rs.82.18 |
|
Euro |
1 |
Rs.55.31 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
9 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
8 |
|
--PROFITABILIRY |
1~10 |
9 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
9 |
|
--RESERVES |
1~10 |
8 |
|
--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 |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
76 |
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/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 |
|