MIRA
INFORM REPORT
|
Report Date : |
20.05.2008 |
IDENTIFICATION
DETAILS
|
Name : |
MARUTI SUZUKI INDIA LIMITED |
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Formerly Known As : |
MARUTI UDYOG LIMITED |
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Registered Office : |
11th Floor,
Jeevan Prakash, 25 Kasturba Gandhi
Marg, New Delhi 110001 |
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Country : |
India |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
24.02.1981 |
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Com. Reg. No.: |
55-11375 |
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CIN No.: [Company
Identification No.] |
L34103DL1981PLC011375 |
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Legal Form : |
Subject 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 Passenger
Cars, Vans, Pickups, Jeeps, etc. in technical and financial collaboration
with Suzuki Motor Corporation of Japan. |
RATING &
COMMENTS
|
MIRA’s Rating : |
A |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
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56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
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Maximum Credit Limit : |
USD 274156000 |
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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 in Indian Auto Industry. Available information
indicates high financial responsibility of the company. Financial position is
satisfactory. Payments are usually correct and as per commitments. The company can
be considered normal for business dealings at usual trade terms and
conditions. |
LOCATIONS
|
Registered
Office : |
11th
Floor, Jeevan Prakash, 25 Kasturba
Gandhi Marg, New Delhi 110001, India |
|
Tel. No.: |
91-11-23316831
(10 lines) / 25063471-74 / 3763-64/ 23712854 |
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Fax No.: |
91-11-23318754 /
23713575 |
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E-Mail : |
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Website : |
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Warehouse /
Factory: |
Palam-Gurgaon
Road, Gurgaon - 122 015, Haryana, India |
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Tel. No.: |
91-124-6340341-5
/ 6341341-5 |
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Fax No.: |
91-124-6341304
(Engg.) / 6340078 (S & D) / 2617 (Prodn.) / 6341411 (P &
P) / 1408 (Spares) / 1402 (PE) / 0338 (Fin.) |
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Voice Mail: |
91-124-6346721 |
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Regional
Offices: |
Located at:- ·
6th
Floor, Hansalaya Building, 15, Barakhamba Road, New Delhi – 110 001 ·
SCO 39-40, 1st
Floor, Sector VIII C, Madhya Marg, Chandigarh – 160 008 Tel. 91-172-2780057 / 2548234 / 2781352 Fax. 91-172-2548234 ·
7th
Floor, Capital Tower, 180, Kodambakkam
High Road, Nungambakkam, Chennai – 600 034, Tamilnadu ·
Apeejay
House, 7th Floor, B Block, 15, Park Street, Kolkata – 700 016,
West Bengal ·
602, 6th
Floor, Madhava Building, Bandra-Kurla Complex, Bandra (East), Mumbai ·
Shakti
Towers – II ‘J’ 766, Mount Road, Chennai – 600 002, Tamilnadu ·
Ground Floor,
Block B-1, Picup Bhawan, Vibhuti Khand, Gomti Nagar, Lucknow – 226 010, Uttar
Pradesh ·
309, 3rd
Floor, Blue Cross Chambers, Infantry Road, Bangalore – 560 001, Karnataka ·
403, Orion
Tower, Christan Basti, G. S. Road, Guwahati – 781 005, Assam. Other Zonal Offices located at: East Zone: Kolkata, Ranchi, Ulubari, North Zone: New Delhi, Chandigarh, Lucknow, South Zone: Nungambakkam, Bangalore, Cochin, Himayatnagar, West Zone: Mumbai, Pune, Ahmedabad, Jaipur, Indore |
DIRECTORS
|
Name : |
Mr. R C Bhargava |
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Designation : |
Chairman and Non
Executive Director |
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Name : |
Mr. Shinzo
Nakanishi |
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Designation : |
Managing
Director |
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Name : |
Mr. Tsuneo
Kobayashi |
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Designation : |
Senior Joint
Managing Director |
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Name : |
Mr. Masayuki
Osada |
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Designation : |
Joint Managing
Director |
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Name : |
Mr. Hirofumi
Nagao |
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Designation : |
Whole Time
Director |
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Name : |
Mr. Shuji Oishi |
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Designation : |
Director –
Marketing and Sales |
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Name : |
Mr. O Suzuki |
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Designation : |
Director |
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Name : |
Mr. Amal Ganguli |
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Address : |
Director |
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Name : |
Mr. D S Brar |
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Designation : |
Director |
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Name : |
Mr. Manvinder
Singh Banga |
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Designation : |
Director |
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Name : |
Mrs. Pallavi
Shroff |
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Designation : |
Director |
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Name : |
Mr. Keilchi Asai |
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Designation : |
Whole Time
Director |
KEY EXECUTIVES
|
Name : |
Mr. anil Rustogi |
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Designation : |
Company Secretary |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
As on 31.03.2008
|
Category of Shareholders |
No.
of Shares |
%
of Holding |
|
Shareholding of
Promoter and Promoter Group2 |
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Indian |
-- |
-- |
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Sub Total(A)(1) |
-- |
-- |
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Foreign |
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Bodies Corporate |
156618440 |
54.21 |
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Sub Total(A)(2) |
1556618440 |
54.21 |
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Total
Shareholding of Promoter and
Promoter Group (A)= (A)(1)+(A)(2) |
1556618440 |
54.21 |
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Public shareholding |
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Institutions |
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Mutual Funds/ UTI |
18843389 |
6.52 |
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Financial Institutions / Banks |
6081825 |
2.11 |
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Insurance Companies |
41926369 |
14.51 |
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Foreign Institutional Investors |
45347942 |
15.70 |
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Sub-Total (B)(1) |
112199525 |
38.84 |
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Non-institutions |
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Bodies Corporate |
11170286 |
3.87 |
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Individuals |
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Individuals -i. Individual shareholders
holding nominal share capital up to Rs 0.100 million |
7143098 |
2.47 |
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ii. Individual shareholders holding nominal share capital in excess of Rs. 0.100 million |
1175821 |
0.41 |
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Any Other n Non Resident
Indian n Trusts n Foreign
Nationals n Clearing Members
|
303595 4116 450 294729 |
0.11 0.00 0.00 0.10 |
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Sub-Total (B)(2) |
20092095 |
6.95 |
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Total Public
Shareholding (B)= (B)(1)+(B)(2) |
288910060 |
100.00 |
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GRAND TOTAL
(A)+(B)+(C) |
288910060 |
100.00 |
BUSINESS DETAILS
|
Line of
Business : |
Manufacturing of
Passenger Cars, Vans, Pickups, Jeeps, etc. in technical and financial
collaboration with Suzuki Motor Corporation of Japan. |
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Products: |
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Brand Names : |
·
Maruti –800 ·
Esteem ·
Omni ·
Zen ·
Gypsy ·
Wagon-R ·
Baleno ·
Alto ·
Versa |
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Exports to : |
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Products: |
All Products |
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Countries: |
Hungary, Nepal,
Mauritius, France, Australia, Papua New Guinea, Gabons, UK and Israel. |
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Imports from : |
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Products: |
Raw Material |
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Countries: |
Japan |
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Terms : |
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Selling : |
Cash and L/C
terms. |
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Purchasing : |
Cash, Contract
and Credit (30 to 60 days) terms. |
PRODUCTION STATUS
|
Particulars |
Unit |
Licensed
Capacity |
Installed
Capacity |
Actual
Production |
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Passenger Cars
and Light Duty |
Nos. |
-- |
450000 |
667048 |
GENERAL
INFORMATION
|
Suppliers : |
·
Suzuki Motor
Corporation, Japan ·
Climate
Control India Limited, India ·
Sona
Steerling Systems Limited, India ·
Bharat Seats
Limited, India ·
Lumax
Automatic Parts Industries Limited, India ·
Asahi India
Safety Glass Limited, India |
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Customers : |
·
Wholesalers ·
Government
Bodies |
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No. of
Employees : |
About 4000 |
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Bankers : |
+
State Bank
of Travancore, New Delhi +
Punjab
National Bank, Parliament Street, New Delhi +
Bank of
America, New Delhi +
Bank of
Tokyo – Mitsubishi Limited, New Delhi +
Standard
Chartered Grindlays Bank Limited, Connaught Place, New Delhi - 110 001 +
State Bank
of India, New Delhi +
American
Express Bank, New Delhi +
Corporation
Bank, New Delhi +
BNP Paribas,
Kasturba Gandhi Marg, New Delhi - 110 001 +
Sanwa Bank,
Kasturba Gandhi Marg, New Delhi – 110 001 +
ABN Amro
Bank, Barakhamba Road, New Delhi – 110 001 +
Union Bank
of India, New Delhi +
Credit
Lyonnais Bank, New Delhi +
Citibank
N.A., Barakhamba Road, New Delhi +
State Bank
of India, Gurgaon, Haryana. |
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Facilities : |
Secured Loans
Unsecured Loans
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Banking Relations : |
Good |
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Auditors : |
Price Waterhouse
& Company Chartered
Accountants |
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Address: |
B-102, Himalaya
House, 23, Kasturba Gandhi Marg, New Delhi – 110001. |
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Associates: |
·
Suzuki Metal
India Limited ·
JJ Impex
(Delhi) Private Limited ·
Asahi India
Glass Limited ·
Bharat Seats
Limited ·
Caparo
Maruti Limited ·
Climate
Systems India Limited ·
Denso India
Limited ·
Jay Bharat
Maruti Limited ·
Krishna
Maruti Limited ·
Machino
Plastics Limited ·
Mark Auto
Industries Limited ·
Nippon
Thermostat (India) Limited ·
Sona Koyo Steering
Systems Limited ·
Citicopr
Maruti Finance Limited ·
Maruti
Countrywide Auto Financial Services Limited ·
Suzuki
Europe SA ·
Suzuki
France SA ·
Suzuki
Italia S P A ·
Suzuki
Australia Pty Limited ·
Suzuki
Austria Automobile Handels GmbH ·
Suzuki GB
PLC ·
Magyar Suzuki
Corporation ·
Suzuki Motor
Poland Limited ·
Suzuki
Manufacturing Spain S.A. ·
Suzuki Metal
India Limited ·
Suzuki
International Europe GmbH ·
Sl Lberica
(including Suzuki Madrid) |
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Subsidiaries: |
v Maruti Insurance Brokers Limited v Maruti Insurance Distribution Services
Limited v True Value Solutions Limited |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
744,000,000 |
Equity Shares |
Rs.5/- each |
Rs.3720.000 millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
288,910,060 |
Equity Shares |
Rs.5/- each |
Rs. 1445.000 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 |
1445.000 |
1445.000 |
1445.000 |
|
|
2] Share
Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves &
Surplus |
67094.000 |
53081.000 |
42343.000 |
|
|
4] (Accumulated
Losses) |
0.000 |
0.000 |
0.000 |
|
NETWORTH
|
68539.000 |
54526.000 |
43788.000 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
635.000 |
717.000 |
3076.000 |
|
|
2] Unsecured
Loans |
5673.000 |
0.000 |
0.000 |
|
TOTAL BORROWING
|
6308.000 |
717.000 |
3076.000 |
|
|
DEFERRED TAX
LIABILITIES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
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TOTAL
|
74847.000 |
55243.000 |
46864.000 |
|
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APPLICATION OF FUNDS
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block]
|
26597.000 |
16952.000 |
18737.000 |
|
Capital work-in-progress
|
2389.000 |
920.000 |
421.000 |
|
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|
|
|
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|
INVESTMENT
|
34092.000 |
20512.000 |
15166.000 |
|
DEFERREX TAX ASSETS
|
0.000 |
0.000 |
0.000 |
|
|
|
|
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CURRENT ASSETS, LOANS & ADVANCES
|
|
|
|
|
|
|
Inventories
|
7132.000 |
8812.000 |
6666.000 |
|
|
Sundry Debtors
|
7474.000 |
6548.000 |
5995.000 |
|
|
Cash & Bank Balances
|
14228.000 |
14016.000 |
10294.000 |
|
|
Other Current Assets
|
0.000 |
0.000 |
0.000 |
|
|
Loans & Advances
|
10726.000 |
9331.000 |
8019.000 |
Total Current Assets
|
39560.000 |
38707.000 |
30974.000 |
|
Less : CURRENT LIABILITIES & PROVISIONS
|
|
|
|
|
|
|
Current Liabilities
|
22886.000 |
17048.000 |
14542.000 |
|
|
Provisions
|
4905.000
|
4800.000
|
3892.000
|
Total Current Liabilities
|
27791.000 |
21848.000 |
18434.000 |
|
Net Current Assets
|
11769.000 |
16859.000 |
12540.000 |
|
|
|
|
|
|
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MISCELLANEOUS EXPENSES
|
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
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TOTAL
|
74847.000 |
55243.000 |
46864.000 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Sales Turnover [including other income]
|
172059.000 |
147531.000 |
133357.000 |
|
Other Income
|
3553.000 |
6652.000 |
5449.000 |
|
Total Income
|
175612.000 |
154183.000 |
138806.000 |
|
|
|
|
|
|
|
Profit/(Loss) Before Tax
|
22798.000 |
17500.000 |
13049.000 |
|
Provision for Taxation
|
7178.000 |
5609.000 |
4513.000 |
|
Profit/(Loss) After Tax
|
15620.000 |
11891.000 |
8536.000 |
|
|
|
|
|
|
|
|
Earnings in Foreign Currency : |
|
|
|
|
|
Export Earnings |
5781.000 |
5839.000 |
NA |
|
|
Total Earnings |
5781.000 |
5839.000 |
NA |
|
|
|
|
|
|
|
Import Value
|
|
|
|
|
|
Raw Materials |
101374.000 |
88779.000 |
NA |
|
|
Stores & Spares |
366.000 |
167.000 |
NA |
|
|
Total Imports |
101740.000 |
88946.000 |
NA |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Raw Materials |
107390.000 |
93356.000 |
85632.000 |
|
|
Excise Duty |
25096.000 |
27372.000 |
24119.000 |
|
|
Power & Fuel Cost |
974.000 |
572.000 |
581.000 |
|
|
Other Manufacturing Expenses |
1535.000 |
1413.000 |
927.000 |
|
|
Employee Cost |
2662.900 |
2114.500 |
1914.600 |
|
|
Selling and Administration Expenses |
9416.700 |
6685.600 |
5800.100 |
|
|
Miscellaneous Expenses |
2649.400 |
2111.900 |
1855.300 |
|
|
Interest & Financial Charges |
376.000 |
204.000 |
360.000 |
|
|
Depreciation |
2714.000 |
2854.000 |
4568.000 |
|
Total Expenditure |
152814.000 |
136683.000 |
125757.000 |
|
SUMMARISED RESULTS
|
PARTICULARS |
|
|
|
31.03.2008 |
|
Type |
|
|
|
Full
Year |
|
Sales Turnover |
|
|
|
179362.000 |
|
Other Income |
|
|
|
8875.500 |
|
Total Income |
|
|
|
188237.500 |
|
Total Expenditure |
|
|
|
156929.100 |
|
Operating Profit |
|
|
|
31308.400 |
|
Interest |
|
|
|
596.200 |
|
Gross Profit |
|
|
|
30712.200 |
|
Depreciation |
|
|
|
5681.700 |
|
Tax |
|
|
|
7722.300 |
|
Reported PAT |
|
|
|
17308.200 |
|
Dividend (%) |
|
|
|
100.00 |
KEY RATIOS
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt Equity Ratio |
0.06 |
0.04 |
0.08 |
|
Long Term Debt Equity Ratio |
0.06 |
0.04 |
0.08 |
|
Current Ratio |
1.58 |
1.73 |
1.42 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
3.10 |
2.95 |
2.77 |
|
Inventory |
21.58 |
19.06 |
24.12 |
|
Debtors |
24.69 |
23.52 |
20.70 |
|
Interest Cover Ratio |
61.63 |
86.78 |
37.25 |
|
Operating Profit Margin (%) |
15.05 |
13.93 |
13.47 |
|
Profit Before Interest and Tax Margin (%) |
13.47 |
12.00 |
10.05 |
|
Cash Profit Margin (%) |
10.66 |
9.99 |
9.82 |
|
Adjusted Net Profit Margin (%) |
9.08 |
8.06 |
6.40 |
|
Return on Capital Employed (%) |
35.63 |
34.68 |
31.28 |
|
Return on Net Worth (%) |
25.38 |
24.19 |
21.42 |
LOCAL AGENCY
FURTHER INFORMATION
BIODATA:
Maruti Udyog Ltd (MUL) was incorporated in February 1981 through an Act
of Parliament, as a Government company with Suzuki Motor Corporation (SMC) of
Japan. It was established to achieve the goals of modernization of Indian
Automobile Industry, production of vehicles in large volumes and production of
fuel efficient vehicles. Suzuki was an ultimate one to achieve this all because
of their expertise in small cars segment.
The Joint Venture agreement was signed between Government of India and Suzuki
Motor Corporation in October 1982. The Company went into production in a record
time of 13 months marking the beginning of a revolution in the Indian
automobile industry. The First car was rolled out for sale in December 1983.
Initially, Suzuki was holding 26 per cent Stake. Now MUL is a subsidiary of
Suzuki with an equity holding of 54.21 per cent.
Maruti Udyog has been the leader of the Indian car market for about two
decades. Its manufacturing plant, located in Gurgaon, has an installed capacity
of 3,50,000 units per annum, with a capability to produce about half a million
vehicles.
Maruti produces cars with world-class contemporary Japanese Technology,
suitably adapted to Indian conditions and Indian car users. It also provides
users with a range of cars to suit different needs. The company has a portfolio
of 11 brands, including Maruti 800, Omni, Premium small car Zen, International
brands Alto and WagonR, off-roader Gypsy, mid size Esteem, Luxury car Baleno,
the MPV, Versa, Swift and Luxury SUV Grand Vitara XL7.
In 2001-02, the Cabinet Committee on divestment approved the exit of Government
of India from the Joint Venture, Suzuki Motor Corporation, Government of India
and the Company executed a Revised Joint Venture Agreement (RJVA). Pursuant to
RJVA, the company made a further issue of 1,219,512 equity shares of Rs.100
each at a premium of Rs. 3,180 share each. On 30th May, 2002, the company
allotted 1,216,341 equity shares aggregating to Rs. 398.96 crores in favour of
SMC, which include the portion fully renounced by GOI besides SMC's own
entitlement. 3,171 Equity Shares were duly cancelled as the Maruti Udyog
Limited Employees Mutual Benefit Fund decided not to subscribe its right
entitlement. After this allotments, the company has become the subsidiary of
SMC.
In 2002-03, Pursuant to the Revised Joint Venture, the Government of India
offered 72,243,300 equity shares, equivalent of 25 per cent of the company's
share capital, for sale to the public. To enable the retail investor to
participate widely in this offer, the company subdivided the face value of an
equity share of Rs. 100 to Rs. 5. Despite depressed sentiment in the capital
market, the issue was fully subscribed within three hours of opening.
Encouraged by the overwhelming response, the GOI exercised the greenshoe option
and off-loaded an additional 10 per cent of the issue or 2.5 per cent of the
company's share capital.
In the same year, Maruti Udyog and Suzuki Motor Corporation had jointly set-up
a Joint-Venture company under the name Suzuki Metal India Limited (SMIL) to
engage in the business of, inter alia, manufacturing Aluminium die casting or
low pressure casting engine parts such as cylinder blocks, transmission cases,
cylinder heads for four wheelers and two wheelers. This was created with a view
to reduce material cost besides ensuring a smooth and uninterrupted supply.
In 2004-05, MUL in collaboration with Suzuki Motor Corporation has established
a new company Maruti Suzuki Automobiles India Ltd. (MSAIL) for setting up a new
manufacturing plant at Manesar. In this new entity, the company will hold 70
per cent equity the balance will be held by SMC. The company has also started
the works to set up a new Engine and Transmission facility in collaboration
with Suzuki Motor for the manufacture of diesel engines, petrol engines and
transmission assemblies for four wheeled vehicles. This will reduce the cost of
production of cars.
In 2006, Maruti Udyog acquired the 30 per cent equity stake of SMC in Maruti
Suzuki Automobiles India Ltd. Subsequently, the company decided to amalgamate
MSAIL with itself. Now, it has been amalgamated with MUL.
In recent years, Maruti has made major strides towards its goal of becoming
Suzuki Motor Corporation's R & D hub for Asia. It has introduced upgraded
versions of WagonR Zen and Esteem, fully designed and styled in-house. Maruti's
contribution in the development of the Indian auto industry is a paramount one.
Maruti tops customer satisfaction again for sixth year in a row according to
the J.D. Power Asia Pacific 2005 India Customer Satisfaction Index (CSI) study.
The company's quality systems and practice have also been rated as a 'benchmark
for the automotive industry world-wide' by A V Belgium, global auditors for
International Organisation for Standardisation.
Maruti has also spread its wing in auto related service businesses. These were
aimed at enhancing customer experience while building long term relationship.
The company's service businesses including sale and purchase of pre owned cars
(True Value), lease and fleet management service for corporates (N2N), Maruti
Finance and Maruti Insurance are enabling the company to offer one-stop shop
for the customers.
FINANCIAL
HIGHLIGHTS:
The gross revenue (net of excise) of Maruti for the year was Rs.152523 million
as against Rs.124814 million in the previous year showing an impressive growth
of 22.2%. Profit before tax (PBT) stood at Rs.22798 million against Rs.17500
million in the previous year recording a jump of 30.3%. Profit after tax (PAT)
of Rs.15620 million showed a growth of 31.4% over the previous year figure of
Rs.11891 million.
HIGHLIGHTS
OF OPERATIONS:
(A) Vehicle Business:
(i) Domestic:
For the year 2006-07, Maruti achieved its highest ever sale of 635629 vehicles
in passenger cars category (including MPV) and grew by 21% over 2005-06,
whereas the passenger car industry growth was 22.2%. In 2006-07, Maruti
achieved a market share of 54.6% (including MPV) as compared to 55.1% in
2005-06. Maruti further strengthened its leadership position in highly
competitive A2 segment with the launch of three new models - the Zen Estilo,
the Swift Diesel and the new WagonR with major changes in the front, rear and
the interiors. Maruti also launched WagonR Duo, with an approved factory fitted
LPG kit. All these models received overwhelming response from the
customers.
In 2006-07, Maruti retained a market share of 58.5% in A2 segment with a growth
of 31.4% over 2005-06. Maruti achieved 15% market share in A3 segment. In order
to reinforce its presence in the A3 segment and enhance its leadership, Maruti
launched SX4 sedan in May'07. SX4 is built on a brand new platform and powered
by the global high tech M-series engine.
In the MUV segment Maruti launched the new Grand Vitara - a stylish, muscular, 5-seater SUV in July'07.
Exports:
In 2006-07, Maruti exported 39295 vehicles to 45 countries. The top 5 export
markets were Sri Lanka with 9269 units, Algeria with 8651 units, Chile with
6216 units, Egypt with 2814 units and Saudi Arabia with 2.072 units. Maruti
registered a growth of 65% over previous year in non-European markets, and its
cumulative exports stood at 454492 vehicles as on March 2007. New markets
developed were Indonesia and Philippines and Maruti recommenced exports to
Angola. Caribbean Islands, Jordan, Lebanon, Panama, Peru, Uruguay. West African
countries and Yemen. Maruti invited 157 delegates from 24 countries for
showcasing its strengths and leadership position in India. Maruti organised
their visits to the factory, dealer showrooms, service centers and formal
seminars by Sales and Marketing division to share Maruti's unique initiatives
in the Indian market for mutual benefit. Maruti's principle of identifying and
reaching out to potential customers through a focused approach was well taken
and appreciated by its overseas distributors.
(B) Spares and Accessories
Business:
Sales of Spare Parts and Accessories business continued to show a healthy
growth in 2006-07. The major challenge during the year was to ensure comprehensive
and timely supplies of spare parts for approximately 5000 flood affected Maruti
Cars in Surat (Gujarat). This helped in Maruti being the first among all the
car manufacturers of the country to have repaired all the flood affected cars
that reported at its workshops. The range of Maruti Genuine Accessories also
increased substantially resulting in approximately 35% growth in the
business.
NETWORK:
The record sales performance was effected through Maruti's vast dealership
network. The new car sales network grew from 375 outlets to 500 during the
year. These outlets covered 312 cities across the country.
In addition to this, there are 223 Maruti True Value outlets spread
across 148 cities, which are engaged in the sale, purchase and exchange of
pre-owned cars. Maruti True Value is the largest organised pre-owned car sales
network in India.
The service network had a total of 2445 service outlets, covering 1172
cities.
EXPANSION OF MANUFACTURING
FACILITIES:
New Car Manufacturing Plant: The Company's new car manufacturing plant at
Manesar started which was during the year, amalgamated with the Company under
the order of Hon'ble High Court of Delhi dated 10th October 2006. The said
order was subsequently registered with the Registrar of Companies on 13th
November 2006.
New Engine and Transmission Facility:
The project was implemented in the existing joint venture company viz Suzuki
Powertrain India Limited. The Commercial production was also started during the
year.
SUBSIDIARY COMPANIES:
a) Maruti Insurance Business Agency
Limited. (previously Maruti Insurance Brokers Limited).
The name of the company was changed from Maruti Insurance Brokers
Limited to Maruti Insurance Business Agency Limited. The company is engaged in
the business of selling insurance policies to Maruti car owners in a tie-up
with National Insurance Company Ltd. The company recorded total revenue of
Rs.569.24 million, profit before tax of Rs.162.25 million and profit after tax
of Rs.109.01 million.
b) Maruti Insurance Distribution
Services Limited:
The company is engaged in the business of selling insurance policies to Maruti
car owners in a tie-up with Bajaj Allianz General Insurance Company Ltd. The
company recorded total revenue of Rs.106.29 million, profit before tax of
Rs.32.56 million and profit after tax of Rs.21.96 million.
c) True Value Solutions Limited:
The company has contributed towards smooth operation of business processes at
Maruti True Value outlets and supported the dealerships in enhancing the sale
of certified pre-owned cars under the brand Maruti True Value. It has earned an
income of Rs.21.15 million with an expenditure of Rs.17.50 million and profit
before tax of Rs.3.65 million in the financial year 2006-07.The Board hopes to
continue its high standards of service in increasing the network in the
financial year 2007-08.
d) Maruti Insurance Agency Solutions
Limited:
The Company has recorded a total revenue of Rs.107.47 million, profit before
tax of Rs.32.25 million and profit after tax of Rs.21.35 million.
e) Maruti Insurance Agency Network
Limited:
The company has recorded a total revenue of Rs.162.68 million, profit before
tax of Rs.48.82 million and profit after tax of Rs.32.32 million.
f) Maruti Insurance Agency Services
Limited:
The company was incorporated on 17th July 2006. The company shall play an
intermediate role under changed environment of de-tarrifed scenario. The above
companies shall continue to focus on customer retention and enhancing volume through
renewals. Along with enhancing volumes, the endeavour to improve the service
levels to dealers and customers through a process driven approach and effective
use of information technology systems will also continue.
CORPORATE SOCIAL RESPONSIBILITY
(CSR):
As a responsible corporate citizen. Maruti is well aware of its social
commitments and believes in partnerships for pursuing activities related to
Corporate Social Responsibility. During the year, Maruti undertook various
activities in the field of Institutes of Driving Training and Research (IDTR),
Industrial Training Institutes (ITIs), Maruti Driving Schools, Traffic
Management in Gurgaon, Children's Park, Truck Drivers Education Centre,
Donation of Omni Ambulance to Senior Superintendent of Police (SSP), Gurgaon
etc.
MANAGEMENT DISCUSSION AND ANALYSIS:
The buoyancy in the economy, growing consumer aspiration in urban India and a
flurry of new products provided a strong foundation for growth of the auto
industry in the year 2006-07. For the first time, the auto industry
collectively crossed the milestone of more than 10 million vehicles a year in
domestic sales.
GDP grew by 9.4% in real terms, with manufacturing sector growing at 12.5%. The
government recognized the auto industry as an engine of national economic
growth.
The passenger car industry grew by about 22%. the fifth successive year of
significant growth. For Maruti, it was a year with many positives, but the
first half of the year involved a transition on many fronts. One of the models,
the old Zen was discontinued. In the run up to the launch of a new Wagon R and
Wagon R M Duo, the Company was bringing down production and inventory of the
old WagonR. Production of Swift was being shifted &2 out of the Gurgaon
plant t o the upcoming facility in Manesar.
Towards the later part, the Company launched the new Zen Estilo and Swift
Diesel. The Manesar plant went onstream. All the models launched by the Company
were received well by customers. The Manesar plant reached full capacity utilization
within months of starting operations and work on capacity expansion is in
process. With this the Company was able to accelerate its growth from 17.8% in
the first half to 23.8% in the second half and close the year with an aggregate
of 54.6% market share in passenger cars (including multi purpose vehicles).
For the year, the sales of one model Alto alone was more than the total
domestic sales of the nearest competitor. The Company had nine model platforms
in its range by the close of the year 2006-07 and two more premium segment
models, the SX4 and the Grand Vitara have been launched in early 2007-08. The
Company's efforts in previous years of creating downstream businesses like
insurance, finance, pre-owned cars coupled with a large serviceable population
of Maruti cars on the road helped enhance dealer profitability. Significant
network expansion could therefore take place. With this network, the Company
penetrated deeper into rural and upcountry markets and improved its market
share in the big cities. In terms of financials. the Company's profit after tax
grew by 31.4% and it was able to increase its EBIDTA margin from 17.1% to
17.7%.
The financial results take into account the impact of the merger of the
Company's wholly owned subsidiary Maruti Suzuki Automobiles India Limited
(MSAIL) with itself, with effect from 1st April 2006. The merger was approved
during the quarter October-December 2006. The merger enabled more synergies as
one Company. The Company had earlier bought back the shares of MSAIL at par,
for operational ease and better shareholder value.
The agenda of the year for the Company was to build capacities, capability and
management bandwidth through the value chain. This was evident in the continued
expansion of the Company's sales and service network, and the growth in
manpower in the field. Further, there were efforts to enhance design and
development capabilities within the Company and among suppliers. The diesel
powertrain plant at Manesar is a state-of-the-art facility and Suzuki's first
diesel venture meant to feed its global operations from India. This year was
also particularly happening for exports as the Company systematically developed
new markets for its compact cars in countries outside Europe.
MARKET: NEW DREAMS, NEW CHALLENGES AND A
NEW MARUTI
Maruti has been a name synonymous with products that are tried, tested and
trusted. While these traits have been valued by customers at large, there is a
fast growing section of Indian consumers who are more conscious of style,
technology and affinity. The challenge is to also address the requirement of
this emerging India, while retaining Maruti's core values. With Suzuki's
support, the Company started offering new products that are exciting and
stylish while retaining Maruti's traditional strengths.
This story of change started with Swift in May 2005. With its advent, a
new and younger set of customers came calling on Maruti dealerships. With the
success of the Swift, an upper segment within the earlier A2 segment with
reasonably good volumes was created. In a segment otherwise known for its focus
on reliability and economy, the Swift brought an image of contemporary style
and technology.
The requirement of emerging India was studied in other aspects also. With the
advent of good highways, Maruti was sensitive to the needs of long distance
commuters. WagonR Duo, which runs on both petrol and LPG. was launched in July,
2006. While the market is thronged by suppliers of alternate fuel kits, in the
interest of customers' safety and product quality, the Company decided to offer
a factory-fitted option. WagonR Duo is the only car in the A2 segment with a
factory fitted LPG Kit. It has been accepted well by customers.
Another new launch, the Zen Estilo, became the fastest model to clock
15,000 sales in India after launch. A special limited edition of Alto, 'Alto
Xfun' with tastefully designed interiors, stylish body graphics and body
colours was also launched and well received in the market.
The Company made focused efforts to reach out to consumers. During the year,
the Company added 125 sales outlets to take the sales network to 500 sales
outlets covering 312 cities. Service is a very important tool for customer
contact for the Company. The service network expanded to cover 1172 cities with
2445 workshops. The Company's own field offices and human resources were
expanded and empowered across the country to develop a local focus.
Customer satisfaction and delight:
The Company was ranked first in customer satisfaction in the annual survey
conducted by JD Power Asia Pacific. According to JD Power, given the size of
customer base to be serviced, no market leader in the world had ever been
ranked first in customer satisfaction. With an organization-wide focus on the
customer, the Company was able to do it for the seventh time in a row.
In sales satisfaction, the Company was ranked first in India for the
third time in a row in the survey by JD Power Asia Pacific.
The Company won the Avaya Global Connect Customer Responsiveness Award 2006.
In a ranking of the world's most reputed companies reported in Forbes
magazine, Maruti Suzuki was ranked 91. Among automobile players, it ranked 5th
in the world, ahead of many global giants. BusinessWorld ranked Maruti as
India's Most Respected Automobile Company.
Business today listed the Company among 'India's 10 Best Marketers'.
With faster product refreshment a need of the market, product development and
life cycle management has become a key competency. UGC Corp, a leading global provider
of product lifecycle management (PLM) software and services, named Maruti as
The Grand Prize Winner of its Asia Pacific PLM Excellence Award for 2006.
PERFORMANCE:
The Company is primarily in the business of manufacturing and selling passenger
vehicles, with emphasis on passenger cars. The Company registered its highest
ever sales of 674,924 vehicles, in the domestic and export markets, during
2006-07. This resulted in gross revenue of Rs.152,523 million (net of excise),
a growth of 22.2% over 2005-06.
ANALYSIS OF SALES:
Domestic:
The Indian passenger vehicle market witnessed sales of 1,379,698 units during
the fiscal year 2006-07. This is 20.7% more than domestic sales in the previous
year. Vehicle production crossed 1.5 million, indicating an impressive 18%
increase year on year. (All data pertaining to automobile market is based on
figures released by SIAM or Society of Indian Automobile Manufacturers)
The passenger vehicle segment is broadly divided into three vehicle
categories:
1. Passenger Cars2. Multi-purpose Vehicles and3. Utility Vehicles
The following chart shows the relative share of each segment in the Company's
passenger vehicle sales, where passenger car sales have been broken up
according to the SIAM-based classification.
Relative Share of Sales Volume within Maruti Sales:
Passenger Cars:
Passenger cars in 2006-07 accounted for almost 78% of the total passenger
vehicle market, up from 77.2% in the previous financial year. In volume terms,
the total sale of passenger cars was 1,076,408 units in 2006-07.
Looking at the recent trends in market expansion, the Company entered
the diesel segment with the launch of Swift Diesel in January 2007. In the
alternate fuels space, the WagonR Duo and the Omni LPG have shown strong
growth.
The Indian passenger car market is classified into six categories, from
A1 to A6 based on vehicle length. The Company is present in A1, A2 and A3
categories. The following chart plots the Company's sales volumes in these
categories for 2005-06 and 2006-07.
Maruti Passenger Car Sales Across
Segments:
A1 Category:
Maruti 800 continues to be the only car in this segment. The Company has
managed to keep its price under the Rs.200,000 mark (ex-showroom, Delhi) even
after adding various technological and security features like Bharat III
compliant engine and anti-theft immobilizer.
A2 Category:
The Company's position within the A2 segment has been strengthened with the
launch of Zen Estilo and Swift Diesel. The Company clocked sales of 440,375
units in this segment, registering a growth of 31.4%, to retain a market share
of 58.5%.
The Company offers Alto, WagonR, Swift Petrol, Swift Diesel and Zen
Estilo in the A2 segment.
The Company's diesel foray happened as late as the fourth quarter of the year.
For the first three quarters, the Company had only petrol variants tooffer. The
introduction of a car in the diesel segment is likely to bear fruit in the
coming years.
A3 Category:
During the year, the Company offered Esteem and Baleno in this segment. Baleno
was discontinued in the last quarter of the year. The Esteem, notched up 23,634
units, 8% more than in 2005-06. The share of the A3 segment in the total
passenger vehicle market declined last year, though volume has grown.
The Company's premium offering, the SX4, was launched in early 2007-08.
Multi Purpose Vehicles (MPV):
The Company offers two models viz. Omni and Versa in this segment. Sales have
shown a growth of 25.2%. The Company sold 83,091 MPV vehicles in 2006-07.
Utility Vehicles (UV):
This segment is dominated by diesel vehicles. Maruti has a presence with its
petrol Gypsy. The Grand Vitara, a top-end sports utility vehicle, has been
relaunched in 2007-08.
Exports:
In 2006-07, the Company exported 39,295 vehicles to 45 countries. Export to
Europe, discontinued last year, will resume once the new compact car model for
Europe is launched in 2009.
The Company has used the period of transition to develop non-European markets
which can bring incremental sales by the time European sales are brought back.
The Company invited 157 delegates from 24 non-European countries to its
facilities to build confidence and demonstrate the good practices at
dealerships.
Indonesia and Philippines were developed as new markets and exports were
resumed to Angola, Caribbean Islands, Jordan, Lebanon, Panama, Peru, Uruguay,
West African countries and Yemen. With a heavy focus on Non-Europe, exports to
these countries grew by 65% during the year.
DOWNSTREAM BUSINESSES:
The Company has benefited from sales support activities like Maruti Finance,
Maruti Insurance, the pre-owned car business Maruti TrueValue and a
loyalty-cum-referral program Maruti Auto Card.
Maruti
Finance:
About 76% of Maruti cars sold to customers were financed. In all, 44% of
the cars were financed through Maruti Finance and 12% cars were financed
through SBI and its associate banks.
Last year, the Company added four new finance companies into Maruti Finance -
Mahindra Finance, Magma Leasing, Cholamandalam DBS and UTI Bank. These
companies are helping increase the Company's sales through finance
facilitation, including in upcountry locations.
Maruti Insurance:
Maruti Insurance gives the customer total peace of mind during claim settlement
and helps generate customer contact after sale. It also gives an additional
revenue stream to the dealer. Maruti Insurance (MI) issued a total of 1.4
million policies in FY0607 and crossed a cumulative figure of 5 million
policies since inception. The total dealer payout stood at Rs.1135 million.
A major development in the auto industry was the detariffing of motor insurance
from January, 2007. The insurance regulator permitted partial flexibility in
insurance premia, starting with a band of +/- 20% from the rate prevailing
before January. 2007. Based on the Company's low cost of repairs and
substantial business volumes, the Company was able to get the best premium
rates with its partner insurance companies. MI premium is fixed at 20% lower
with reference to the rate prevailing before January. 2007. In turn the Company
has taken up a countrywide exercise to further reduce cost of repairs.
Maruti
TrueValue:
Maruti TrueValue offers to buy the customer's existing car in exchange for a
new one. The Company bought about 84,000 cars last year, 90% of which resulted
in the sale of a new car. The good quality cars are refurbished and sold to
customers with a Maruti certificate and warranty. This helps in fulfilling the
aspirations of thousands of new customers. By creating this market, the
residual value for the first car owner also improves. With fast replacement
cycles, residual value is increasingly becoming a consideration in the
customer's choice of a new car. The Company's TrueValue network spreads to 223
outlets in 148 cities.
OPERATIONS:
Safety:
Of the four pillars of manufacturing, the Company attaches the highest
significance to safety. It is the starting point in manufacturing excellence. A
plant designed to be safe is also optimum for performing well on the other
pillars, namely productivity, quality and cost.
Safety awareness among employees contributes significantly in ensuring an
accident free work place. Therefore, strong focus is given on increasing
awareness of employees for safety through audio and visual training tools and
safety mock drills.
The Company's safety programmes also include employees of suppliers who
visit factory premises for material supply. Special training rooms are created
inside the factory to impart safety training.
Productivity:
In the previous year, 2005-06, the Company had evolved a new 'Production
Management System' (PMS) in collaboration with shop floor employees. This is a
distinctive feature of lean manufacturing, whereby workers and supervisors on
the shop floor jointly drive improvements in quality and productivity. During
2006-07, the Company expanded coverage of PMS, inviting ideas through various
channels. This included face-to-face interactions of workers with senior
management, in batches, over several months.
These initiatives enabled the Company achieve a 6.5% improvement in
productivity, measured in man-hours per vehicle, during 2006-07.
The Company started a state-of-the-art Technical Training Centre to train
production supervisors on automobile technology, manufacturing processes,
automation and in-house development of robotics.
Business Risks:
The Company operates in a highly competitive and challenging business
environment. India is now on the radar of major international automobile
companies. They are increasing investments in India for capacity expansion,
launching various new models and marketing them aggressively.
The Company has invested in new manufacturing and engine facilities at Manesar,
Haryana and has been investing on a regular basis to upgrade the existing
Gurgaon facilities. Similarly it has asked vendors and dealers to invest in
manufacturing or retailing facilities.
To generate returns on such huge capital investments, growth in demand on a
sustained basis is essential. As the Company is mainly dependent on the
domestic market, this becomes an area of concern.
The Indian economy has been showing strong growth of around 8% for the last
three years and robust growth is generally expected to continue. The response
of competing manufacturers to the differential excise duty on compact cars will
be a relevant consideration.
It has to be seen how the automobile industry performs in the coming
years.
The Company has also announced the launch of an export specific model by 2009,
which will be primarily for the European market but will also be sold in the
domestic market. The response to the new models will determine the future
capacity utilization and business viability for vendors and dealers.
The Company has developed a strong supplier base over the last two decades.
Some of the suppliers have grown and attained international prominence. The
Company is heavily dependent on its supplier base for components. For
proprietary technology, in some cases the Company is dependent solely on a
single source. This could lead to disruption in production at the Company in
case of any production disruptions or management related issues among one or
more suppliers.
With the economic development in the country, the demand for skilled manpower
has been increasing. In this scenario, retaining trained manpower has become a
challenge for the industry. The Company recruits a large number of engineers
every year, most of them in the engineering and technology areas. The Company
invests substantial amounts on their training at Maruti and at SMC facilities.
A high attrition rate could impact the Company's future plans.
As all the business operations of the Company and most of its suppliers
are located in and around Gurgaon, natural disasters such as earthquake or fire
could damage manufacturing facilities and significantly impair business
operations. However, steps are in place or under implementation to back up the
Company's information infrastructure and the second manufacturing facility will
provide some degree of backup of production capacity.
Commodity Price Risks:
Input into a car in the form of bought-out components is a major cost element.
In turn the major chunk of this cost is dependent on raw material cost. The
Company is thus exposed to risk of movements in commodity prices related to
ferro-alloys (steel), non-ferro alloys (aluminum), plastics, rubber and
precious metals like palladium and rhodium.
Buying from multiple sources helps in risk mitigation as suppliers with
different backgrounds have different degrees of risk. The contract periods vary
across suppliers ranging from short term to medium term, thereby smoothening
the peaks and troughs in commodity price movement.
An increase in the price of petroleum, the key variable cost in car
ownership, may also decrease automobile usage and hence the demand for cars,
adding to the risks associated with commodity prices.
Exchange Rate Risks:
The Company is exposed to the risks associated with fluctuations in foreign
exchange rates, mainly on import of components and raw materials and export of
vehicles. The Company has a well structured exchange risk management policy. It
manages its exchange risk by using appropriate hedge instruments depending on
the prevailing market conditions and the view on the currency.
During 2006-07, the major areas related to forex risk management which the
Company had to undertake were on account of fluctuations in the US Dollar/Yen,
US Dollar/Euro and the Indian Rupee/US dollar exchange rate. The Company
managed its exposures proactively and took forward covers from time to time
based on currency forecasts. The CIF value of imports of raw materials and
components was Rs.12,902 million. Export of goods on FOB basis was Rs.5781
million.
Financial Risks:
Given a debt equity ratio of 0.08, the Company has very little risk associated
with financial gearing. There is an interest rate risk linked to the Company's
sales. Continued growth in the sales of the Company is dependent on prevailing
low interest rates on loans for customers. Hardening of this interest rate can
negatively affect demand for automobiles.
Income from investment of surplus funds is also subject to interest rate
risk. Any rise or fall in the interest rates will affect the return on surplus
funds of the Company. The Company manages this risk by shuffling its portfolio
among various debt mutual fund schemes/fixed deposits with banks, depending on
the interest rate view and prevailing market conditions.
Finally, the Company carries risks associated with contingent liabilities
(details are given in Schedule 23 of the Notes to Accounts). Contingent
liabilities consist mainly of various demands for sales tax, excise duty and
income tax under dispute. All these demands are subjects of appeals at various stages
before the prescribed appellate authorities. We have further higher stages
available in the appeals process.
OUTLOOK:
The growth in per capita income, the percolation of this wealth creation to the
rural and upcountry areas and huge projected investment in infrastructure are
favourable long-term growth drivers for the auto industry.
There are indications that the small car segment could see the entry of new
players and more models. The resulting market scenario, alongside macro
economic factors, will continue to have a bearing on the Company's
prospects.
Over the medium to longer term, the Company is preparing to capture the growth
opportunities. It is investing in new capacities and a new engine series,
besides expanding presence in new product segments and fuel options through new
models. The on-going growth of the Company's network and businesses that seek
to serve the car customer through the entire life cycle, will also stand the
Company in good stead.
India is changing fast and the new India wants style and affinity
alongside value and reliability. With the support of Suzuki Motor Corporation,
the Company has proactively offered products to embrace this new India.
FIXED ASSETS
The company's fixed assets of important value include freehold land, leasehold land, building, plant & machinery, electronic data, processing equipment, furniture & fixture and vehicles.
WEBSITE
DETAILS ARE ATTACHED HEREWITH
This section
provides corporate overview of Maruti Udyog, its vision, quality systems and
technology, along with a brief historical perspective. It also offers a link to
Suzuki's global site, information about export operations and details of the
company's social initiatives in the field of road safety, safe driving, Driving
Training Institute and environment care.
Additionally, this
section contains information for those seeking career and business
opportunities with Maruti. It gives information on multiple channels for
contacting the company. There is also a link for accessing the monthly newsletters.
If you are looking for the latest media coverage on Maruti Udyog, there's a
special section devoted to
This section is
designed for those buying a car and seeking relevant information to support
their purchase decision. It contains detail information of the various models
offered by Maruti Suzuki, the current sales schemes and downloadable brochures.
It also offers price lists and a dealer locator.
Further, there is
information about various related and highly useful services like Maruti Finance,
Maruti Insurance, Maruti True Value, Extended warranty and Maruti Genuine
Accessories. If you need information on N2N Fleet Management services offered
by Maruti, you'll find it right here.
This is a special
section for Maruti car owners like you. It offers a huge array of useful
information like Car care tips, Maintenance advice and special offers. You can
get information about fuel economy, road rules, driving license, and how to
drive safely on road. You can also access your owner's manual online.
Further this
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of boards of directors, shareholding pattern, financial results, annual
reports, monthly sales and quarterly results. You can download nomination form
for AGM here. You will also find conference call transcripts of results review
between maruti management and investors.
PRESS RELEASES:
Maruti
Sales
New Delhi, May 1, 2008
Car market leader
Maruti Suzuki India Limited sold 59,539 vehicles in the domestic market in
April 2008.
The company had sold 48,652 vehicles in the domestic market in April 2007.
In all, Maruti Suzuki India Limited sold 62,336 vehicles in April 2008. This
includes 2,797 units of exports.
Marutiżs volume in the domestic A2 segment grew by 27.3 per cent, in A3 segment
volume grew by 97.1 per cent and the C segment by 25.9 per cent during the
month as compared to sales in April 2007.
The sales figures for April 2008 are given
below:
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·
SX4 launched in May 2007, Grand Vitara launched in July 2007, DZire
launched in March 2008, Baleno figures are for 2007-08.
Maruti
Suzuki becomes the first Indian car company to export half a million cars
New Delhi, 28th February 2008: Car
market leader Maruti Suzuki India Limited has achieved another significant
milestone today. The cumulative exports of India’s leading carmaker today
crossed half a million mark i.e. 500,000 units.
As the ship liner, “Goliath Leader” left Mumbai port on 28th February, carrying
1180 Maruti cars to various Latin American countries, Maruti Suzuki became the
first carmaker in India to cross the 500,000 units of export.
While Maruti Suzuki cars ply in all five continents, Europe has been a popular
destination accounting for 56 per cent of the company’s cumulative exports.
Netherlands with 67,700 units followed by Italy (over 41,000) and UK (over
34,000) have been the biggest European buyers. Germany and Hungary too are
among the countries that have imported over 20,000 Maruti Suzuki cars.
Amongst the non-European markets, Algeria is the biggest buyer with over 42,000
units, followed by Chile, Srilanka and Nepal.
Just as in the Indian market, the Maruti 800, with 178,000 units, has been the
most popular Maruti car overseas. Alto follows closely with 152,000 units.
“Zen”, India first world car that was exported to Europe as early as 1994, was
well received selling over 130,000 units cumulatively.
In the light of Maruti Suzuki’s growing role in Global Suzuki, the company has
set up a state of art assembly plant at Manesar with an initial capacity of
100,000 units. The Manesar plant production capacity is planned to be increased
to 300,000 units in the next two years.
Maruti Suzuki will manufacture Suzuki’s fifth World Strategic Model, A-Star,
for export. The production model will be based on the Concept A-Star, unveiled
at the recent Auto Expo in Delhi. The company plans to export 100,000 units
annually of this new model, to Europe and other parts of the world.
Earlier in February Maruti Suzuki tied up with Mundra port for development of
dedicated port facilities for export shipments of cars through Pure Car
Carriers. The new facility is expected to be operational by December 2008.
Maruti Suzuki plans its first export shipment from the new port facilities in
January 2009.
Maruti Suzuki inks
agreement with Mundra Port for a mega car Terminal
for Exports.
Mundra,
Feb 20th, 2008
Mundra (Gujarat): Maruti Suzuki India Ltd
(MSIL) and Mundra Port and Special Economic Zone Ltd (MPSEZL) today signed an
agreement for a mega car terminal, expected to be operational by December 2008,
at Mundra in Kutch district of Gujarat.
The agreement was signed by Mr Shinzo Nakanishi, Managing Director and CEO, MSIL,
and Mr Gautam S. Adani, Chairman and MD, MPSEZL, at Mundra Port in the presence
of senior officials from MSIL & MPSEZL.The initial investment in the
project is expected to be around Rs 100 crore. Of this, MPSEZL will invest Rs
60 crore in setting up infrastructure at the port. MSIL will invest Rs 40 crore
to set up a Pre-Delivery Inspection (PDI) centre at the port premises. MPSEZL
is planning to augment the port infrastructure in due course of time, a company
spokesman said
Mr Nakanishi said Maruti Suzuki is ready to play a much
greater role in Suzuki's global operations. "We have the technology and
skills to build top quality cars for the international market. But our export
ambitions need infrastructure support on the ground, and this initiative will
be a big step forward in filling that gap."
Mr Adani said the port would develop cost-effective Roll-on Roll-off (RORO)
terminal for facilitating automobile export by Maruti Suzuki, the largest car
manufacturer in India. "Our RORO terminal at Mundra will provide cost
competitive support to Indian automobile industry for international trade and
our aim is to make Mundra a hub for automobile exports. The excellent draft at
Mundra will allow berthing of the largest car carriers and turn them around in
the least possible time.
"Maruti Suzuki's exports have grown significantly this year, and will
touch 50,000 units in 2007-08 (nearly 28 per cent growth). The company
currently exports from Mumbai Port. Maruti Suzuki will be launching its new
model, A-Star, by the end of this calendar year. With this, exports are likely
to go up significantly. The company plans to export two lakh cars annually to
Europe and the rest of the world by the year 2010.
Maruti Suzuki will commence export operations at Mundra Port from January 2009.
In view of increasing export volumes, it will continue exports from Mumbai as
well.
The new terminal will have a car stockyard spread over 35 acres, and a
dedicated 'buffer area" for cars to be parked just before loading on the
PCC (Pure Car Carrier) ships. The car terminal's RORO berth would speed up the
loading process and minimise the chance of damage to cars.
This mega car terminal's PDI Centre, spread over 7,500 square metres, would
conduct the final quality check before the cars are loaded on ships for export.
The Rs 40 crore being invested in this facility is part of the Rs. 9,000-crore
investment plan announced by MSIL and Suzuki Motor Corporation (SMC) of Japan.
MSIL, a subsidiary of SMC, is the leader in passenger cars and MPVs in India,
accounting for almost 55 per cent of total industry sales. It offers 10 models,
ranging from the people's car Maruti 800 to the stylish hatch-back Swift, SX4
Sedan and luxury SUV Grand Vitara.
Listed on the BSE and NSE, the company had a net sales turnover of $3.25
billion and net profit of $347 million 2006-07.
Mundra Port and SEZ is India's largest private sector port and SEZ, having
handled over 20 million tonnes of wide range of cargo including bulk, break
bulk, liquid, containers as well as automobiles during first nine months of
2007-2008. The SEZ which is planned over 32,000 acres of land will be
self-contained with power, water, social infrastructure, airport, railway line,
banking services etc and will house variety of manufacturing and servicing
units.
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.42.64 |
|
UK Pound |
1 |
Rs.83.00 |
|
Euro |
1 |
Rs.66.00 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
6 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
6 |
|
--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 |
|
64 |
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 |
|