MIRA INFORM REPORT
|
Report
Date : |
20.06.2008 |
IDENTIFICATION DETAILS
|
Name : |
CEAT LIMITED |
|
|
|
|
Registered
Office : |
Ceat Mahal, 463, Dr. Annie Besant Road, Worli, Mumbai –
400025, Maharashtra |
|
|
|
|
Country: |
India |
|
|
|
|
Financials
(as on): |
31.03.2007 |
|
|
|
|
Date
of Incorporation : |
10.03.1958 |
|
|
|
|
Com.
Reg. No.: |
11-11041 |
|
|
|
|
CIN
No.: [Company Identification No.] |
L25100MH1958PLC011041 |
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|
|
|
TAN
No.: (Tax Deduction & Collection Account No.) |
MUMC10660G MUMC11397B |
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|
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|
PAN
No.: (Permanent Account No.) |
AAACC1645G |
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|
Legal
Form : |
Public
Limited Liability Company. The
company’s shares are listed on the Stock Exchanges. |
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|
Line
of Business : |
Manufacturing and Marketing of Automotive Tyres,
Automotive Tubes and Automotive Flaps. |
RATING & COMMENTS
|
MIRA’s
Rating : |
Aa |
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
71-85 |
Aa |
Possesses
adequate working capital. No caution needed for credit transaction. It has
above average (strong) capability for payment of interest and principal sums |
Large |
|
Maximum
Credit Limit : |
USD
15145516 |
|
|
|
|
Status
: |
Good |
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|
|
|
Payment
Behaviour : |
Regular |
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|
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Litigation
: |
Clear |
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|
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|
Comments
: |
Subject is a well established company having satisfactory
track. Directors are reported as experienced, respectable and having substantial
means of their own. Their trade relations are fair. Payments are reported as
slow by average 30 days. The
company can be considered normal for business dealings at usual trade terms
and conditions. |
LOCATIONS
|
Registered
/ Corporate Office : |
Ceat Mahal, 463, Dr. Annie Besant Road, Worli, Mumbai –
400025, Maharashtra, India |
|
Tel.
No.: |
91-22-24930621/24616054/25640461/25660461/63 |
|
Fax
No.: |
91-22-24606039/25640301/25663964 |
|
E-Mail
: |
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|
Website
: |
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|
Head
Office : |
6, Lotus House, Sir Vithaldas Thakersey Marg, New Marine
Lines, Mumbai – 400 020, Maharashtra, India |
|
Tel.
No.: |
91-22-28570014/0378/0376 |
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|
|
|
Factory
1 : |
·
Village
Road, Bhandup, Mumbai – 400 078, Maharashtra |
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|
|
|
Factory
2 : |
·
82, MIDC Industrial
Estate, Satpur, Nasik – 422 007, Maharashtra |
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|
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|
Regional
Offices: |
1207, 12th Fl, Modicrop Tower 98, Nehru Place
New Delhi - 110 019 Telephone 91-11-51618491 Fax 91-11-26444098 Sco 201, 2, 3, 1st Floor, Sub City Centre,
Sector 34-A, Chandigarh Telephone 91-172-622057/8 Fax 91-172-622728 2nd Floor, Satnam Complex, Near BMC
Chowk, Jalandhar – 144 001 Telephone 91-181-2244094 Fax 91-181-2244094 Scf No 70, 2nd Floor, Sector 15, Market,
Faridabad – 121 007 Telephone 91-129-5008021/2 Fax 91-129-2429823 C/O Umeed Auto, Auto Market Hissar Road,
Rohtak – 124 001 Telephone 91-1262-49895 Sahni Motors Building, 62 Punjab Pura, Delhi
Road, P B No 374, Meerut – 250 002 91-121-513635 Fax 91-121-513871 201 A, R H Tower, The Mall, (Next to HTL
Clarks), Varanasi – 221102 Telephone 91-542-2503919 Fax 91-542-341919 39, Factory Area, Fazalganj, Kanpur – 208 012 Telephone 91-512-219741 Fax 91-512-216522 307, 3rd Floor, Paradise C-61-A,
Sarojini Marg, C Scheme Jaipur – 302 001 Telephone 91-141-2372808 Fax 91-141-2372022 DRTC House, 1st Floor Cinema Bldg, Behind Olympic
Cinema, Jodhpur – 342 001 Telephone 91-291-616237 Fax 91-291-640721 Plot No 85, Bypass Road, 36-232, D, 1st
Floor New Agra – 282 001 Telephone 91-562-2524840 Fax 91-562-2524839 HCL Compound, Niranjan Pur, Saharanpur Road,
Dehradhun – 248 001 Telephone 91-135-2001237 792, Sherpur Bypass, Ludhiana – 141 003 Telephone 91-161-2675577 Fax Telephone 91-161-2674755 1st Floor, Dhesagar Complex, Opp Dr Wadi
Hospital, Goniana Road, Telephone 91-164-2216706 3rd Floor, Duncan House 31, N.S.
Road, Kolkata – 700 001 West Bengal Telephone 91-33- 22130343 Fax 91-33- 22130346 1st Floor 189, G T Road
(East),Rambandhu Talaw, Asansol – 713 303 Telephone 91-341-213017 Fax 91-341-213017 7, I A S Colony, Kidwaipuri, Patna – 800 001 Telephone 91-612-2524550 Fax 2520511 Arjan Place, 3rd Floor, 5, Main
Road, Ranchi – 834 001 Telephone 91-651-2207252 Fax 91-651-206067 R No 407, 4th Floor Nirmala Plaza,
A-1 Forest Park, Bhubaneswar – 751 009 Telephone 91-674-2595494 Fax 2595092 Udyog Bikas Bhavan Bhangagarh, G S Road,
Guwahati – 781 005 Telephone 91-361-2529060 Fax 91-361-529315 5th Floor,
Akarshan Complx, Central Bazar Road Ramdaspeth, Telephone 91-712-
2547443,55 Fax 91-712- 2547444 13/A, 2nd Floor, Krishna Keval,
Commercial Complex, Kondhwa Telephone 91-20-6835402/3 Fax 91-20-6835404 15, South Civil Lines Caravs Building,
Jabalpur – 482 001 Telephone 91-761-325712 Fax 91-761-320531 219, 220, 2nd Floor 6, Indraprastha
Tower, M G Road, Indore – 452 001 Telephone 91-731-5091909 Fax 91-731-2524261 Neeldhara, 1st Floor Pritamrai
Road, Ellis Bridge, Ahmedabad – 380 006 Telephone 91-79-26577672/73 Fax 91-79-26577297 404, Star Chambers, Harihar Chowk, Panchnath
Plot, Rajkot – 360 001 Telephone 91-281-220217/8 Fax 91-281-291302 S J Logistics, B-29/4 Devendra Nagar, Raipur –
492 004 (CG) Telephone 91-771- 2582712 C/O Rajkiran Agency Telephone 91-95231- 2462701/2 108/109, Thakkar Tower, Plot No 86, Sec 17,
Vashi, Navi Mumbai Telephone 91-22 55912641 No 2, Vijayaraghava Road, T Nagar, Chennai –
600 017 Telephone 91-44-24356387/044-24360769 Fax 91-44-24362519 Sri Sai Baba Chambers, No 2, 1st
Floor, 16, Bharatiya Park Road, Coimbatore – 641 043 Telephone 91-422-453939 Fax 91-422-450157 Pritam Plaza, 1st Floor, 82,
Chandrakant Nagar Ponmeni, Bypass Road, Madurai – 625 010 Telephone 91-452-2387763/4 Safeena Mansion, P B No 1755, M G Road,
Ernakulam – 682 016 Telephone 91-484-353640 Fax 91-484-372720 Jasmine Mansion, 19, J C Road, Bangalore – 560
002 Telephone 91-80-2222388 Fax
91-80-2235027 8, Havelock Road, P B No 23, Camp, Belgaum –
590 001 Telephone 91-831-2423482 Fax 91-831-2426552 Flat No 418, Maheshwari
Chamber, 6-3-650, Somaji Guda, Hyderabad – 500 082 Telephone 91-40-23396722 Fax 91-40-23396539 54/15-3, Srinagar
Colony, Ring Road, Vijayawada – 520 008 Telephone 91-866-450170 Fax 91-866-450073 |
DIRECTORS
|
Name : |
Mr. R. P. Goenka |
|
Designation
: |
Chairman |
|
Other
Directorship : |
Ø
CESC
Limited – Director Ø
Saregama
India Limited – Director Ø
Jubilee
Investments and Ind. Limited - Director Ø
Hilltop
Holdings India Limited – Director |
|
|
|
|
Name : |
Mr. H. V. Goenka |
|
Designation
: |
Vice Chairman |
|
|
|
|
Name : |
Mr. Paras K. Chowdhary |
|
Designation
: |
Managing Director (Appointed on 18/01/2001) |
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|
|
|
Name : |
Mr. M. A. Bakre |
|
Designation
: |
Director |
|
Other
Directorship ; |
Ø
Garware
Wall Ropes Limited – Director Ø
FGP
Limited – Director |
|
|
|
|
Name : |
Mr. A. C. Choksey |
|
Designation
: |
Director |
|
Date
of Appointment : |
28/01/2000 |
|
|
|
|
Name : |
Mr. Hari L. Mundra |
|
Designation
: |
Director |
|
|
|
|
Name : |
Mr. S. Doreswamy |
|
Designation
: |
Director |
|
Date
of Appointment : |
27/07/2000 |
|
Other
Directorship : |
Ø
Can
Fin Homes Limited - Chairman Ø
Pantaloon
Retail [India] Limited – Director Ø
Kaytee
Switchgear Limited – Director Ø
Sakthi
Sugar Limited – Director Ø
Sakthi
Auto Component Limited – Director Ø
Deposit
Insurance and Credit Guarantee Corporation Limited – Director Ø
Caliberpoint
Business Solutions Limited – Director |
|
|
|
|
Name : |
Mr. J. N. Guzder |
|
Designation
: |
Director |
|
|
|
|
Name : |
Mr. H. Khaitan |
|
Designation
: |
Director |
|
|
|
|
Name : |
Mr. B. S. Mehta |
|
Designation
: |
Director |
|
Other
Directorship : |
Ø
Atul
Limited – Director Ø
Bharat
Bijlee Limited – Director Ø
Century
Enka Limited – Director Ø
Housing
Development Finance Corporation Limited – Director Ø
IL
& FS Investment Mergers Limited [Formerly known as IL & FS Venture
Corporation Limited] – Director Ø
J.
B. Chemicals & Pharmaceuticals Limited - Director Ø
Pidilite
Industries Limited – Director Ø
Procter
and Gamble Hygiene and Health Care Limited – Director Ø
Sasken
Communication Technologies Limited – Director Ø
SBI
Capital Markets Limited – Director Ø
Sudarshan
Chemical Industries Limited – Director Ø
The
Dawn Mills Company Limited – Director Ø
Varun
Shipping Company Limited – Director Ø
Vinyl
Chemicals [India] Limited – Director |
|
|
|
|
Name : |
Mr. K. R. Podar |
|
Designation
: |
Director |
|
|
|
|
Name : |
Mr. Mahesh S. Gupta |
|
Designation
: |
Director (Appointed on 02/05/2002) |
KEY EXECUTIVES
|
Name : |
Mr. H. N. Singh Rajpoot |
|
Designation
: |
Company Secretary |
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|
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Audit Committee : |
|
|
Mr. M.
A. Bakre |
Chairman |
|
Mr.
Mahesh S. Gupta |
Member |
|
Mr. S.
Doreswamy |
Member |
|
Mr. Hari
L. Mundra |
Member |
|
|
|
|
Shareholders / Investors Grievance Committee : |
|
|
Mr. M.
A. Bakre |
Chairman |
|
Mr.
Paras K. Chowdhary |
Member |
|
Mr.
Mahesh S. Gupta |
Member |
MAJOR SHAREHOLDERS
|
Category |
No. of Shares held |
% of Shares |
|
Promoters
Holdings (Indian and Foreign) |
19714888 |
43.18 |
|
Mutual
Funds Banks, Financial Institutions, Insurance |
6306160 |
13.81 |
|
Companies
and others |
5106712 |
11.19 |
|
Foreign
Institutional Investors |
4031972 |
8.83 |
|
Non
Resident Indians |
151767 |
0.33 |
|
Corporate Bodies, Indian
Public and others |
10345127 |
22.66 |
|
Total |
45656626 |
100.00 |
BUSINESS DETAILS
|
Line
of Business : |
Manufacturing and Marketing of Automotive Tyres,
Automotive Tubes and Automotive Flaps. |
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Product
: |
|
||||||||||||||||
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|
Brand
Name : |
CEAT,
CEAT SECURA, CEAT ENDURA, CEAT MAESTRO, etc. |
PRODUCTION STATUS
|
PARTICULARS |
Unit |
Licensed Capacity |
Installed Capacity |
Actual Production |
|
Automotive Tyres |
|
4.947 |
4.311 |
7.510 |
|
Automotive Tubes |
|
4.947 |
-- |
7.600 |
|
Automotive Flaps |
|
-- |
-- |
2.530 |
GENERAL INFORMATION
|
No. of
Employees: |
4928 |
|
|
|
|
Bankers
: |
·
Bank
of India Mumbai Corporate Banking Branch, 70-80, Mahatma Gandhi
Road, Mumbai – 400023, Maharashtra ·
Bank
of Baroda ·
Indian
Bank ·
State
Bank of India ·
UCO
Bank ·
Vijaya
Bank ·
Corporation
Bank ·
State
Bank of Travancore ·
The
Dhanalakshmi Bank Limited ·
ICICI
Bank Limited ·
The
Karnataka Bank Limited ·
The
United Western Indian Bank ·
Export-Import
Bank of India ·
Industrial
Development Bank of India Limited ·
Yes
Bank Limited |
|
Facilities : |
(Rs. in millions)
In
respect of the above loans, Rs. 34,3.066 milions (Previous year Rs 44,6.967 millions
) due and repayable within a year. Notes: 1.
13.50% 40,00,000 Secured Redeemable Non-Convertible Debentures of Rs 1.78 (Rs
5.35) each issued to ICICI Bank Limited against financial assistance for
Company's Radial Project. These Debentures are secured by first mortgage on
the immovable properties of the Company situated at Bhileshwarpura, District
Mehsana, Gujarat and pari passu charge
on movable properties of the Radial Project at Nasik. These debentures are
redeemable at par in 16 equal quarterly instalments commencing from December
15, 2003. 2.
Security is created on movable and immovable assets of the Company (except
for CEAT Mahal property at Worli, Mumbai, Temple property at Gwalior in
Madhya Pradesh, property at Bhileshwarpura, District Mehsana, Gujarat and
assets of the Radial unit at Nasik) on pari
passu basis in favour of the following Financial Institutions and
Banks with second charge in favour of Consortium of Banks led by Bank of
India:
3. Term
Loan (Loan II) from IDBI Bank Limited of Rs 14, 2.500 millions (Rs 120.000
millions) is secured by a first pah
passu charge on movable and immovable properties of the Company at
Bhandup and Nasik. 4. ECB
of US$ 10 million from ICICI Bank Limited has been swapped into Rupee
liability of Rs 459.500 millions with the Bank. This loan is secured by a
first pan passu charge on the
movable and immovable properties of the Company at Bhandup and Nasik. 5. The
Term Loan availed from Indian Bank is secured by mortgage of CEAT Mahal
property at Worli in Mumbai and first pah
passu charge on the movable assets of radial Unit at Nasik. 6.
Working Capital Term Loan of Rs 36,9.430 millions (Rs 331.711 millions) from
Consortium of Banks (except Exim Barik) is secured by way of first charge on
the Tea Gardens of Harrisons Malayalam Limited. 7.
Fund/Non fund based Working Capital facilities from Consortium of Banks led
by Bank of India are secured by hypothecation of Inventories and Book debts and
by a second charge on immovable properties of the Company situated at Bhandup
and Nasik Plants and CEAT Mahal property at Worli in Mumbai. 8.
Fund/Non fund based Working Capital facilities given by YES Bank Limited are
secured by way of hypothecation of Inventories and Book Debts of the Company. 9. The
vehicle loans availed from Banks and Financial Companies are secured by way
of hypothecation of the vehicles financed by them.
In respect of the above loans,
Rs.350.672 millions (Previous Year Rs 513.348 millions ) is due and repayable
within a year. |
|
|
|
|
Banking Relations : |
Satisfactory |
|
|
|
|
Auditors
: |
·
N.
M. Raiji & Company Chartered Accountants |
|
|
|
|
Associates/Subsidiaries
: |
v Associated CEAT Holdings Company
(Private) Limited v CEAT-Kelani Associated Holdings
Company (Private) Limited v Associated CEAT (Private) Limited, v CEAT-Kelani International Tyres
(Private) Limited v ACT Limited v Associated CEAT Kelani Radials
Limited v Rado Tyres Limited v Zensar Technologies Limited |
CAPITAL STRUCTURE
Authorised
Capital :
|
No. of
Shares |
Type |
Value |
Amount |
|
46100000 |
Equity Shares |
Rs.10/-
each |
Rs.461.000
millions |
|
3900000 |
Preference Shares |
Rs.10/-
each |
Rs.
39.000 millions |
|
10000000 |
Unclassified Shares |
Rs.10/-
each |
Rs.100.000
millions |
|
GRAND TOTAL |
|
Rs.
600.000 millions |
|
Issued,
Subscribed & Paid-up Capital :
|
No. of
Shares |
Type |
Value |
Amount |
|
45750004 |
Equity Shares |
Rs. 10/-
each |
Rs.
457.500 millions |
|
45656626 |
Equity Shares |
Rs.10/-
each |
Rs.456.566
millions |
|
Add : |
Allotment Money/Calls in Arrears |
|
Rs. 0.233 millions |
|
GRAND TOTAL |
|
Rs.
914.299 millions |
|
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE SHEET
|
SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
SHAREHOLDERS
FUNDS |
|
|
|
|
|
1] Share
Capital |
456.799 |
456.799 |
350.981 |
|
|
2] Share
Application Money |
0.000 |
0.000 |
0.000 |
|
|
3]
Reserves & Surplus |
3329.580 |
3033.244 |
5950.397 |
|
|
4]
(Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
3786.379 |
3490.043 |
6301.378 |
|
|
LOAN
FUNDS |
|
|
|
|
|
1] Secured
Loans |
2757.593 |
2912.227 |
3388.534 |
|
|
2]
Unsecured Loans |
2164.955 |
2300.501 |
1117.832 |
|
|
TOTAL BORROWING |
4922.548 |
5212.728 |
4506.366 |
|
|
DEFERRED
TAX LIABILITIES |
232.808 |
139.885 |
419.265 |
|
|
|
|
|
|
|
|
TOTAL |
8941.735 |
8842.656 |
11227.009 |
|
|
|
|
|
|
|
|
APPLICATION
OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED
ASSETS [Net Block] |
7000.097 |
7217.056 |
5294.435 |
|
|
Capital
work-in-progress |
101.334 |
42.735 |
150.327 |
|
|
|
|
|
|
|
|
INVESTMENT |
1278.090 |
1278.090 |
1907.936 |
|
|
DEFERREX
TAX ASSETS |
0.000 |
0.000 |
289.380 |
|
|
|
|
|
|
|
|
CURRENT
ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
2212.171
|
1834.544 |
1682.042 |
|
|
Sundry
Debtors |
2631.707
|
2532.277 |
2366.003 |
|
|
Cash
& Bank Balances |
405.513
|
396.127 |
312.363 |
|
|
Other
Current Assets |
0.000 |
0.000 |
0.000 |
|
|
Loans
& Advances |
560.620
|
630.458 |
5252.361 |
|
Total Current Assets |
5810.011
|
5393.406 |
9612.769 |
|
|
Less : CURRENT LIABILITIES &
PROVISIONS |
|
|
|
|
|
|
Current
Liabilities |
4896.485
|
4703.253 |
5562.147 |
|
|
Provisions |
351.312
|
385.378 |
465.691 |
|
Total Current
Liabilities |
5247.797
|
5088.631 |
6027.838 |
|
|
Net Current Assets |
562.214
|
304.775 |
3584.931 |
|
|
|
|
|
|
|
|
MISCELLANEOUS
EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
8941.735 |
8842.656 |
11227.009 |
|
PROFIT & LOSS ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
Sales
Turnover |
21347.781 |
17474.263 |
15669.754 |
|
|
Other Income |
244.434 |
226.256 |
|
|
|
Total
Income |
21592.215 |
17700.519 |
15669.754 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
609.188 |
52.174 |
[28.742] |
|
|
Provision for Taxation |
216.703 |
46.998 |
[10.000] |
|
|
Profit/(Loss) After Tax |
392.485 |
5.176 |
[18.742] |
|
|
|
|
|
|
|
|
Earnings
in Foreign Currency : |
|
|
|
|
|
|
Export Earnings |
4294.626 |
3935.029 |
|
|
|
Royalty |
10.289 |
8.830 |
2595.019 |
|
|
Technology Fee |
0.000 |
8.662 |
|
|
|
Other Earnings |
1.170 |
1.207 |
|
|
Total
Earnings |
4306.085 |
3953.728 |
2595.019 |
|
|
|
|
|
|
|
|
Imports
: |
|
|
|
|
|
|
Raw Materials |
4697.412 |
3342.332 |
|
|
|
Stores & Spares |
6.998 |
4.914 |
|
|
|
Capital Goods |
31.712 |
26.869 |
3381.377 |
|
|
Trade Goods |
329.644 |
221.714 |
|
|
Total
Imports |
5065.766 |
3595.829 |
3381.377 |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Personnel expenses |
1282.306 |
1185.872 |
|
|
|
Raw Material Consumed |
14425.177 |
12092.411 |
|
|
|
Purchases made for re-sale |
443.522 |
284.363 |
15747.009 |
|
|
Interest |
604.271 |
635.561 |
|
|
|
Depreciation & Amortization |
310.606 |
224.472 |
|
|
|
Other Expenditure |
3940.765 |
3455.946 |
|
|
Total
Expenditure |
21006.647 |
17878.625 |
15747.009 |
|
QUARTERLY
RESULTS
|
Particulars |
30.06.2007 |
30.09.2007 |
31.12.2007 |
31.03.2008 |
|
Type |
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
4th
Quarter |
|
Sales
Turnover |
5364.400 |
5831.900 |
5641.100 |
6462.300 |
|
Other
Income |
188.400 |
77.400 |
82.500 |
715.800 |
|
Total
Income |
5552.800 |
5909.300 |
5723.600 |
7178.100 |
|
Total Expenditure |
4870.900 |
5286.400 |
5223.200 |
6077.000 |
|
Operating
Profit |
681.900 |
622.900 |
500.400 |
1101.100 |
|
Interest |
140.300 |
138.000 |
149.200 |
141.900 |
|
Gross
Profit |
541.600 |
484.900 |
351.200 |
959.200 |
|
Depreciation |
80.000 |
79.300 |
75.100 |
95.500 |
|
Tax |
178.100 |
150.600 |
83.900 |
40.000 |
|
Reported
PAT |
303.500 |
255.000 |
192.200 |
769.300 |
KEY
RATIOS
|
PARTICULARS |
|
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt-Equity Ratio |
|
1.39 |
1.50 |
1.46 |
|
Long Term Debt-Equity Ratio |
|
0.88 |
0.90 |
0.88 |
|
Current Ratio |
|
0.78 |
0.98 |
1.23 |
|
TURNOVER RATIOS |
|
|
|
|
|
Fixed Assets |
|
2.15 |
2.35 |
3.25 |
|
Inventory |
|
11.78 |
11.07 |
10.46 |
|
Debtors |
|
9.26 |
7.97 |
7.36 |
|
Interest Cover Ratio |
|
1.87 |
1.07 |
0.89 |
|
Operating Profit Margin(%) |
|
6.79 |
5.12 |
4.87 |
|
Profit Before Interest And Tax
Margin(%) |
|
5.49 |
3.97 |
3.63 |
|
Cash Profit Margin(%) |
|
2.94 |
1.18 |
0.87 |
|
Adjusted Net Profit Margin(%) |
|
1.64 |
0.03 |
(0.37) |
|
Return On Capital Employed(%) |
|
15.07 |
9.58 |
8.33 |
|
Return On Net Worth(%) |
|
10.79 |
0.16 |
(2.09) |
LOCAL AGENCY FURTHER
INFORMATION
History:
Subject was
incorporated on 10th March 1958 at Mumbai in Maharashtra having
Company Registration Number 11041.
The company was set up with a capital of Rs. 11.500 millions
contributed in a 60:40 ratio by CEAT (Cavi Electric Affini Torino) of Turin,
Italy, and the Investment Corporation of India (A TATA Group Company). Its’ first tyre rolled out from its factory
at Bhandup in Maharashtra on February 22, 1960. By the end of that year, the
rapidly expanding workforce consisting of 200 workers, produced a total of
45,246 tyres. Today, company's total production per annum is close to 6 million
units, making the company among the top 20 tyre companies in the world. Over the past few years, the company has
restructured by divesting loss making non-core businesses of glass fibber, NTCF
and photocopiers. The company divested
its other business viz. nylon tyre cord division and fibreglass plant and now
consolidating its position through takeovers and joint ventures.
The flagship of the RPG group, manufactures steel-belted
radials for passenger cars. The various range of tyres manufactured are
marketed under “Ceat”, “Samrat” and “Secura” brand names.
With the amalgamation of Deccan Fibre Glass in 1983 and
Murphy India (a BIFR company) in 1970, Ceat acquired the glass fibre unit and
the electronics division respectively. It also acquired Murphy’s photocopier
division, which had Ricoh, Japan, as the technology supplier. The glass fibre
unit was sold to FGP in June 1993. While the operations of Electronics Division
have been suspended from 1992-93 onwards, Associated Ceat (Private) Limited,
the company’s joint venture in Sri Lanka, commenced production of tyres for
LCVs towards the end of 1993.
The Photocopier Division was sold to RPG Ricoh in May
1994. The company also transferred its Aurangabad
unit to South Asia Tyres, a joint venture with Goodyear India, in financial
collaboration with Goodyear Tyre Company, US, to manufacture radial and
earthmover tyres.
The radial tyre plant has commenced commercial production in
Nasik and the formula one radial tyres have been well received in the market.
The company is planning to acquire the capacity in the newer
plants in Baroda and Hyderabad to produce two wheeler tyres for the
company. The production in Hyderabad
plant was expected in August, 2002.
The company is the first tyre company in India to have been
awarded the International accreditation ISO/TS 16949 - 2002 Quality Standard
Certification.
The company has entered into agreement with Pirelli of Italy
for outsourcing radial tyres, which are marketed in the brand name, CEAT Spider
Radials. The company is exporting its products to nearly 50 countries and is
entering into the new markets namely Thailand, Hong Kong, Eritrea and Israel
INDUSTRY
SCENARIO
A
resurgence in the Indian economy over the past few years has induced a good
rate of growth in the automobile industry which grew at 15.8% during the period
2002-2006. Consequently the overall demand for tyres also registered an average
growth of about 8% during this period. The demand-supply situation became
favourable and tyre sales across all segments were buoyant. Original Equipment
(OE) segment, in particular, registered a double digit growth. With increasing
agricultural and industrial activity, rising vehicle demand, infrastructure
development such as Golden Quadr4lateral and North South East West Corridor
projects, state road networks and connectivity to ports, the demand for high
quality tyres for high speed operations has already started growing. subject,
with its appropriately segmented product portfolio, is well poised to take
advantage of this emerging opportunity in_the domestic market
During
the last year, the industry has become more globalised. Imports of truck tyres
has increased manifold. A number of free trade agreements with neighbouring
regions are under finalisation. On the other hand exports out of India have
shown an encouraging trend. On the raw material front, the year under review
was very volatile. Natural rubber prices touched a peak of Rs. 118 per kg
before settling down at levels of about Rs. 90 per kg. Crude oil prices
continued to be a cause of concern for the industry. All other raw materials
also witnessed a surge in prices. This had put additional strain on the
profitability of the Company in the first half of the financial year. However,
due to favourable demand supply situation, the industry was able to revise its
product pricing and thereby offset raw material cost
increase.
SUBJECT'S
PERFORMANCE
The
Company registered a revenue growth of 22.5 % during the year under review. All
three (3) segments of subject's business, namely exports, Original Equipment
Manufacturers (OEMs) and domestic replacement sales have shown good growth
during the year under review with existing and new OEM customers being the key
drivers. Realisation from OEMs have improved during the year. Along with
improved product mix, the Company's profitability has therefore improved in
this segment. Domestic replacement market was extremely competitive, partly due
to increasing imports from China. Despite this, the Company has been able to
increase sales of premium products through improved focus and targeted
marketing activities. New products in the Truck and LCV segment have met with
an excellent response. Several innovative initiatives were implemented in the
manufacturing and materials front, which led to significant productivity
enhancement and cost reduction. Financing costs were kept on a very tight leash
throughout the year despite increase in interest rates. Combined with the relentless
focus on efficiencies, subject has turned in an impressive improvement in
profitability, and registered a net profit of Rs. 392.5 millions , a growth of
about 75 times over the net profit of Rs. 5.200 millions in the previous year.
What is important, is that the Company's business model is now a sustainable
one, which is suitably de-risked.
EXPORTS
The
Company has extended its global footprint to 110 countries across the globe.
Its export basket has improved substantially in terms of price realisations and
profitability. The Company has established a stable and extensive network in
South America, North America as well as in Europe. subject's products have been
accepted with several OEMs in Europe during the year under review, despite
competing with global majors. These businesses are of an annuity nature and
hence would ensure stability in future years. Thirteen new products were
launched in the export market during this year.
FUTURE
OUTLOOK
With increasing
expense on, infrastructure in India and with GDP expanding at a healthy pace of
more than 8%, the Indian automobile industry is expected to grow at the rate of
about 15% in the next ten years resulting in a good future for the tyre
industry. This will translate into plans for increased investment and capacity
expansion. Subject’s business plan for the financial year 2007-2008 takes into
account the above and the Company expects to achieve improved performance in
the coming years. * The user industry, particularly fleet operators, Is
becoming increasingly professionalized and consolidated. Hence the customer is
getting more and more discerning, which throws up a huge opportunity to
differentiate subject and open unique avenues to segment the market and satisfy
the needs in a focused manner. The passenger segment is poised for rapid
expansion as well. The customer is increasingly looking for more value addition
in terms of higherend products as well as services. The industry in general,
will get increasingly integrated to the global market, both in terms of
finished goods and in terms of raw materials, as well.
INDUSTRY
STRUCTURE & DEVELOPMENTS
As a
result of the good growth of the Indian economy since 2002, particularly at
about 9% in the last two yeans, the automobile industry has grown at a CAGR of
15.8% in the last five years. Consequently, the demand for products of its
ancillaries has also improved significantly. For the same reason, tyre
industry, which was facing a sluggish demand till three years back, experienced
a favourable demand supply situation during the year under review. Road
infrastructure investment is expected to grow at 11 % in the next three years.
Improvement in road infrastructure due to this investment is likely to lead to
shifting of cargo transport from railways to roads, which in turn should
increase sale of commercial vehicles. Higher movement of goods and increased
traffic is expected to boost the demand for automobiles further. Currently, the
share of automobile industry is 5% of GDP. This is expected to increase to
10-12% in the next decade. Also, India, it is expected, will soon emerge as an
automobile outsourcing and manufacturing hub. This development will be
beneficial to various segments of automobile industry viz. 2-wheeler,
3-wheeler, passenger cars, commercial vehicles, etc. The expected growth in the
automobile industry will translate into sustainable growth of its ancillary,
the tyre industry, both in Original Equipment Manufacturing (OEM) segment and
Replacement Market during next 5- 10 years.
The tyre
industry witnessed continuous increase in raw material costs in the past
several years which resulted in lower margins. With growth in demand for tyres
not being adequate to compensate for this rise, tyre manufacturers were neither
able to pass on the cost increases to customers nor obtain better prices from
OEMs. Due to lower profitability, the industry did not invest in capacity
expansions either. However, for reasons mentioned above, the demand supply
situation has turned favourable during the year under review, and consequently
the pricing power of the industry has improved. This has enabled the industry
to affect several price increases during the year under review, resulting in
increased volumes and better margins for the industry. Considering the demand
projections, the tyre industry is expected to invest approximately Rs.
30000.000 millions on capacity expansion in the next five years and the
industry is expected to grow at a CAGR of 10.7%.
OPPORTUNITIES
• Indian
economy is expected to grow at about 8% during 2007-2008.
• Road
infrastructure investment to grow at about 11 % in the next three years and
Indian Automobile Industry to grow at
15% in the next 10 years.
•
Automobile majors continue to operate at full capacity and have ambitious
expansion plans.
• The
above are likely to result in growth of the tyre industry at around 10.7% in
the next five years.
•
Increasing acceptance of Indian tyres in export markets. 'Made in India' is
becoming a strength in export markets.
PRODUCTWISE
PERFORMANCE
Subject
continues to have the widest product portfolio in the industry. This
includes small tyres for scooter/ motorcycles (7%), passenger cars (4%),
light commercial vehicles (13%). Tractors (7%), Heavy Commercial
Vehicles (64%) and Mining / other Vehicles (5%). subject has grown
handsomely in the commercial segment of truck tyres in the domestic
market. While OEM demand has been buoyant throughout the year,
replacement demand for subject's high mileage performance tyres has seen
a good upswing. Subject’s truck tyre portfolio has found increasing
acceptance in all key segments across the country and the perception
about this product segment has moved up several notches with good acceptance
amongst key big fleet operators in the country. Subject has considerably
displayed stronger pricing power, which with improved product mix has had a
direct impact on bottomline. Several new
products
were introduced during the year, both in the premium and the Value For Money
(VFM) segments. Subject has scaled the learning curve in the context.of sales
and marketing, while focusing in the key markets of south and west. It is now
ready to sell higher quantities and garner stronger market shares. Subject’s
Light Commercial Vehicle (LCV) portfolio has grown as well, at the high end of
the product portfolio. Sustained marketing activities in this category has also
led to improvement of perception and sales and subject is well poised to gain
higher market shares in the coming years. New products were launched in the
premium as well as in the value-for-money segment. The motorcycle tyre segment
has shown robust growth while sale of scooter tyres went down during the last
fiscal. Since production capacity of car tyres remained the same throughout the
year, growth in the passenger car segment was marginal. With increase in
capacity and development of several new products, patterns and sizes in the
coming year, subject is well placed to hike its market shares in the car tyre
segment as well.
Subject
is now exporting to more than 110 countries across the world. It has
considerably improved its distributor network in the USA, South America and in
Europe, during the year under review. Subject’s export basket now has a diverse
portfolio. The export business is not only profitable, but also adequately
de-risked because of the product range and the wide range of customers.
Subject’s improved product mix is being increasingly accepted by OEMs in export
markets and is a result of subject's design and innovation capabilities. This
business model in exports is sustainable over a long period of time, which has
had a positive impact on the bottomline of the Company.
OUTLOOK
Driven by
sustained growth of Indian Economy/ Automobile Industry, the Indian Tyre Industry
is expected to grow at a CAGR of 10.7% in the next ten years, as against 7.7%
during the past ten years.
SUBJECT’S
STRATEGY FOR 2007-2008
Subject
would like to dominate in select segments in the domestic as well as in the
export market. With globalization of the economy, new segments are getting
created. Subject has chosen some key segments where it will focus its entire
marketing activities in the future with a view to achieve leadership status.
'Select and dominate' will be subject's strategy in all product categories.
Further improvement in product mix and realizations will be the key operational
deliverables of the entire strategy.
Business:
Subject is
engaged in the business as manufacturers and marketers of Automotive Tyres, Automotive
Tubes and Automotive Flaps.
The company is the second largest tyre manufacturer in the
country.
ASSOCIATED CEAT- KELANI
VENTURE
Subject's joint venture in Sri Lanka, registered a modest
revenue growth of 7%, up from SL Rs. 2713 million in the previous year to SL
Rs. 2910 million for the year under review. The profit for the year at SL Rs.
54 million was lower as compared to the profit of SL Rs. 83 million for the
previous year. The earnings could have been substantially higher but for the loss
of production in one of the two manufacturing units on account of labour
issues, which have since been settled through a long term productivity linked
wage settlement.
This venture is already a market leader in the bias segment
with a market share of over 50%. It is currently implementing a new project to
manufacture 26,000 passenger car radial tyres per month. With substantial
increase in productivity and the foray into radial segment, revenue and
profitability of this venture are expected to see significant improvement in
the coming years.
AUTHORISED SHARE CAPITAL
Pursuant to Article 5 of The Articles of Association of the
Company, the Board of Directors at its meeting held on 23rd September
2005 have re-classified 108,86,680 as equity shares of Rs. 10/- each out of
total 208,86,680 unclassified shares of Rs. 10/- each as mentioned in the last
balance sheet in order to facilitate issue of equity shares of Rs. 10/- each on
rights basis in terms of Letter of Offer dated 8th December
2005.
The company
is in trade terms with the following :
v Accura Valves
v Acmechem Private Limited
v Alfred Rubber Products
v Bharat Rubber Regenerating Limited
v Deekay Clutches
v Grand Wood Works & Saw Mill
v Pukhraj Engineering & Chemicals
v Rajashree Enterprises
v Solar Chemferts Private Limited
v Suraiya Private Limited
v Shree Samarth Industries
v Vibros Rubber Products Private
Limited
v Burad Chemicals Private Limited
v Micro Belts & Tyres Private
Limited
The
company’s fixed assets of important value includes land, building, plant and machinery,
furniture and fixtures and vehicles.
As per Web Details :
About them
The oldest of the RPG Enterprises companies,
subject Tyres was established in 1958. Today, they are one of India’s leading
tyre manufacturers, with an annual turnover of Rs 1,7800 Millions (US $400
million). Their solid brand equity has empowered them to establish a strong
presence in both, domestic and international markets. Their tyres, tubes and
flaps are renowned for their superior quality and durability, and are
recognized as being ‘born tough’.
They offer the widest range of tyres to all user segments, and manufacture
world-class radials for all Indian vehicles including:
Ø
Heavy-duty Trucks and Buses
Ø
Light Commercial Vehicles
Ø
Earthmovers
Ø
Forklifts
Ø
Tractors
Ø
Trailers
Ø
Cars
Ø
Motorcycles and Scooters
Ø
Auto-rickshaws
They also market tubes
and flaps, which are outsourced from 7 to 8 units.
Possessing an enviable list of clients
They enjoy long-standing
business tie-ups with major OEMs including TATA Motors, Ashok Leyland, Mahindra
& Mahindra, Maruti, L&T, Eicher, Swaraj Mazda, Caterpillar, Bajaj
Tempo, Piaggio, Hero Honda, HMSI (wholly owned subsidiary of Honda Motors,
Japan) and TVS Motors.
Focused on Quality
At subject, they
continue to stay committed to enhancing the quality of their products and
upgrading their technologies. It goes without saying that they adhere to the
highest standards of safety. Testimony to their endeavours is the fact that
they are the first and only Indian tyre company to be awarded the ISO/TS
16949:2002 certification, by TUV, a reputed certification body, based in
Netherlands.
Subject Quality Policy
They are
customer-centric and consistently deliver excellent products and services at
competitive prices. It is their endeavour to continually improve all their
business processes and ensure conformance to the established quality systems.
They accomplish this through constant upgrading of their employees’ skills.
History
Ø
Subject stands for Cavi Electrici Affini Torino
(Electrical Cables and Allied Products of Turin).
Ø
Subject International was first established in
1924 at Turino in Italy and manufactured cables for telephones and railways.
Ø
In 1958, subject came to India, and CEAT Tyres
of India Limited was established in collaboration with the TATA Group.
Ø
In 1982, the RPG Group took over CEAT Tyres of
India, and in 1990, renamed the company CEAT Limited.
Current Scenario
Ø
Manufactures over 6 million tyres every year.
Ø
Enjoys 55% of the local market for light truck
and truck tyres.
Ø
Operates from plants in Mumbai and Nasik.
Ø
Exports to USA, Africa and other parts of Asia.
Ø
Has a robust network consisting of 36 regional
offices, over 3,500 dealers and more than 100 C&F agents.
Ø
Has a dedicated Customer Service department,
comprising Customer Service Managers in all four divisional offices, assisted
by 50 Service Engineers.
Contact them
Exports
CEAT Mahal
463, Dr. Annie Besant
Road, Worli
Mumbai – 400 030
Telephone:
+91 22 2493 0621
Fax: +91 22 2493 8933
America, Europe and
Far East
e-mail: sgulati@ceatltd.com
Middle East and Africa
E-mail: jyoti@ceatltd.com
Customer Cell
CEAT Mahal
463, Dr. Annie Besant Road, Worli
Mumbai – 400 030
Telephone: +91 22 2493 0621
Fax: +91 22 2493 8933
E-mail: customercare@ceatltd.com
OEM
CEAT Mahal
463, Dr. Annie Besant Road, Worli
Mumbai – 400 030
Telephone: +91 22 2493 0621
Fax: +91 22 2493 8933
E-mail: pkshukla@ceatltd.com
CMT REPORT
[Corruption, Money laundering & Terrorism]
The Public Notice information has been collected from various
sources including but not limited to: The Courts, India Prisons Service,
Interpol, etc.
1] INFORMATION ON DESIGNATED PARTY
No
records exist designating subject or any of its beneficial owners, controlling shareholders
or senior officers as terrorist or terrorist organization or whom notice had
been received that all financial transactions involving their assets have been
blocked or convicted, found guilty or against whom a judgement or order had
been entered in a proceedings for violating money-laundering, anti-corruption
or bribery or international economic or anti-terrorism sanction laws or whose
assets were seized, blocked, frozen or ordered forfeited for violation of money
laundering or international anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that
subject is or was the subject of any formal or informal allegations,
prosecutions or other official proceeding for making any prohibited payments or
other improper payments to government officials for engaging in prohibited
transactions or with designated parties.
3] Asset Declaration :
No
records exist to suggest that the property or assets of the subject are derived
from criminal conduct or a prohibited transaction.
4] Record on Financial Crime :
Charges or
conviction registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l Anti-Money
Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No available
information exist that suggest that subject or any of its principals have been
formally charged or convicted by a competent governmental authority for any
financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with Government :
No record exists to
suggest that any director or indirect owners, controlling shareholders,
director, officer or employee of the company is a government official or a
family member or close business associate of a Government official.
9] Compensation Package :
Our market survey
revealed that the amount of compensation sought by the subject is fair and
reasonable and comparable to compensation paid to others for similar services.
10] Press Report
:
No press reports / filings exists on the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments
on Corporate Governance to identify management and governance. These factors
often have been predictive and in some cases have created vulnerabilities to
credit deterioration.
Our Governance Assessment focuses principally on the
interactions between a company’s management, its Board of Directors,
Shareholders and other financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.42.93 |
|
UK Pound |
1 |
Rs.84.17 |
|
Euro |
1 |
Rs.66.82 |
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 |
YES |
|
--EXPORT
ACTIVITIES |
YES/NO |
YES |
|
--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 |
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 |