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3decades

 

MIRA INFORM REPORT

 

 

Report No. :

503803

Report Date :

13.04.2018

 

 

 

IDENTIFICATION DETAILS

 

Name :

CEAT LIMITED

 

 

Registered Office :

RPG House, 463, Dr. Annie Besant Road, Worli, Mumbai – 400030, Maharashtra

Tel. No.:

91-22-24930621

 

 

Country :

India

 

 

Financials (as on) :

31.03.2017

 

 

Date of Incorporation :

10.03.1958

 

 

Com. Reg. No.:

11-011041

 

 

Capital Investment / Paid-up Capital :

INR 404.501  Million

 

 

CIN No.:

[Company Identification No.]

L25100MH1958PLC011041

 

 

IEC No.:

[Import-Export Code No.]

0388015284

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

Not Available

 

 

GSTN :

[Goods & Service Tax Registration No.]

27AAACC1645G1ZZ

 

 

TIN No:

27360299286

 

 

PAN No.:

[Permanent Account No.]

AAACC1645G

 

 

Legal Form :

A Public Limited Liability Company. The Company’s Shares are Listed on the Stock Exchanges.

 

 

Line of Business :

Manufacturing of Automotive Tyres, Tubes and Flaps. (Registered Activity)

 

 

No. of Employees :

5580 (Approximately)

 

 

RATING & COMMENTS

(Mira Inform has adopted New Rating mechanism w.e.f. 23rd January 2017)

 

MIRA’s Rating :

A++

 

Credit Rating

Explanation

Rating Comments

A++

Minimum Risk

Business dealings permissible with minimum risk of default

 

Maximum Credit Limit :

USD 66000000

 

 

Status :

Excellent

 

 

Payment Behaviour :

Regular

 

 

Litigation :

Exist

 

 

Comments :

CEAT is a part of the RPG group and was incorporated on 10th March 1958. The Company is engaged in manufacturing of tyres, tubes and flaps. CEAT caters to diverse businesses in automotive tyres, infrastructure, information and technology, pharmaceuticals, plantations and power ancillaries.

 

CEAT in one of India’s leading tyre manufactures having presence in global markets, and has a capacity of over 95000 + tyres per day.

 

For the financial year ended 2017, the company has achieved revenue growth of 4.21% as compared to the previous year along with an average profit margin of 5.69%.

 

Rating reflects CEAT’s sound operating efficiencies marked by stable financial profile and comfortable debt coverage metrics despite large capital expenditure plans.

 

Rating also factor in the strength derived from being part of a well-established and experienced business group, i.e. RPG Enterprises, backed by CEAT’s established brand, strong market position with diversified product portfolio and distribution network.

 

However, rating strength is partially offset by volatility in raw material prices and high competition prevalent in the tyres market.

 

Payments are reported to be regular and as per commitment.

 

In view of aforesaid, the company can be considered good for normal business dealings at usual trade terms and conditions.

 

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

 

 

ECGC Country Risk Classification List

 

Country Name

Previous Rating

(30.09.2017)

Current Rating

(31.12.2017)

India

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low Risk

 

A2

Moderately Low Risk

 

B1

Moderate Risk

 

B2

Moderately High Risk

 

C1

High Risk

 

C2

Very High Risk

 

D

 

 

EXTERNAL AGENCY RATING

 

Rating Agency Name

CARE

Rating

Long-term Bank Facilities = AA

Rating Explanation

High degree of safety and very low credit risk.

Date

08.01.2018

 

Rating Agency Name

CARE

Rating

Short-term Bank Facilities = A1+

Rating Explanation

Very strong degree of safety and carry lowest credit risk.

Date

08.01.2018

 

 

RBI DEFAULTERS’ LIST STATUS

 

Subject’s name is not enlisted as a defaulter in the publicly available RBI Defaulters’ list.

 

 

EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS

 

Subject’s name is not enlisted as a defaulter in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of 31-03-2018.

 

 

BIFR (Board for Industrial & Financial Reconstruction) LISTING STATUS

 

Subject’s name is not listed as a Sick Unit in the publicly available BIFR (Board for Industrial & Financial Reconstruction) list as of 13.04.2018

 

 

IBBI (Insolvency and Bankruptcy Board of India) LISTING STATUS

 

Subject’s name is not listed in the publicly available IBBI (Insolvency and Bankruptcy Board of India) list as of report date.

 

 

INFORMATION DENIED

 

Management non co-operative (91-22-24930621/ 24938933)

 

 

LOCATIONS

 

Registered Office :

RPG House, 463, Dr. Annie Besant Road, Worli, Mumbai – 400030, Maharashtra, India

Tel. No.:

91-22-24930621

Fax No.:

91-22-24938933

E-Mail :

shaileshjoshi@ceatltd.com

iikhan@ceatltd.com

investors@ceatltd.com

hns.rajpoot@ceat.in

shruti.joshi@ceat.in

priti.arjunwadkar@ceat.in

Website :

http://www.ceattyres.com

http://www.ceat.com 

Area :

10000 sq. ft.

Location :

Owned

 

 

Plants 1 :

Village Road, Bhandup, Mumbai – 400078, Maharashtra, India

 

Plants 2 :

82, MIDC Industrial Estate, Satpur, Nasik – 422007, Maharashtra, India

 

Plants 3 :

Village Gate Muvala, Halol, Panchmahal - 389350, Gujarat India

 

Plants 4 :

Plot No.SZ-39, Butibori MIDC, Nagpur 441108, Maharashtra, India

 

 

Regional Offices:

Located At:

 

  • Mumbai
  • Ahmedabad
  • Indore
  • Jabalpur
  • Pune
  • Rajkot
  • Kolkata
  • Bhubaneshwar
  • Guwahati
  • Patna
  • Ranchi
  • New Delhi
  • Faridabad
  • Jaipur
  • Jalandhar
  • Kanpur
  • Meerut
  • Rohtak
  • Hyderabad
  • Bangalore
  • Belgaum
  • Ernakulam
  • Chennai
  • Chandigarh
  • Coimbatore
  • Vijayawada
  • Jodhpur
  • Varanasi
  • Nagpur
  • Raipur
  • Asansol
  • Agra
  • Ludhiana
  • Udaipur
  • Aurangabad
  • Bhopal
  • Lucknow
  • Kolhapur
  • Kanpur
  • Surat

 

Sales Offices :

Located At:

 

·         Chhattisgarh

·         Madhya Pradesh

·         Bihar

·         Delhi

·         Uttar Pradesh

·         Karnataka

·         Andhra Pradesh

·         Maharashtra 

·         Goa

·         Gujarat

 

 

Branch Offices :

·         503, Barton Centre (5th Floor), 84, Mahatma Gandhi Road, Bangalore – 560 001, Karnataka, India

·         “E” Road, Northern Town, Bistupur, Jamshedpur – 831 001, Jharkhand, India

·         Tata Centre, 1st Floor, 43, J. L. Nehru Road, Kolkata-700 071, West Bengal, India

·         2/42, Ansari Road, 1st Floor Daryaganj, Sant Vihar, New Delhi – 110 002, India

 

 

DIRECTORS

 

AS ON 31.03.2017

 

Name :

Mr. Atul Champaklal Choksey

Designation :

Director

Address :

Geetanjali, 9 N. Gamadia Road, Off Peddar Road, Mumbai- 400026, Maharashtra, India

Date of Appointment :

28.01.2000

DIN No.:

00002102

 

 

Name :

Mr. Haigreve Khaitan

Designation :

Director

Address :

1104 Sterling Seaface, Dr. Annie Besant Road, Worli Mumbai- 400018, Maharashtra, India

Date of Appointment :

29.07.1999

DIN No.:

00005290

 

 

Name :

Mr. Harsh Vardhan Goenka

Designation :

Director

Address :

Unit No. 208, 2nd Floor, Bezzola Complex, B Wing, Sion Trombay Road, Opposite Suman Nagar, Chembur, Mumbai- 400071, Maharashtra, India

Date of Appointment :

16.10.1981

DIN No.:

00026726

 

 

Name :

Mr. Doreswamy Sheshagiri Rao

Designation :

Director

Address :

33/3, Juhu Shalimar, Gulmohar Cross Road No. 10, J.V.P.D. Scheme, Mumbai- 400049, Maharashtra, India

Date of Appointment :

27.07.2000

DIN No.:

00042897

 

 

Name :

Mr. Mahesh Shrikrishna Gupta

Designation :

Director

Address :

402, Ashok House, Beach House CHS, Gandhigram Road, Juhu Mumbai- 400049,  Maharashtra, India

Date of Appointment :

02.05.2002

DIN No.:

00046810

 

 

Name :

Mr. Paras Kumar Chowdhary

Designation :

Director

Address :

74/84, Clover Park Royale Lane, N 7, Koregaon Park, Pune- 411001, Maharashtra, India

Date of Appointment :

01.04.2013

DIN No.:

00076807

 

 

Name :

Mr. Hari Lakshminarayan Mundra

Designation :

Director

Address :

A-61, Twin Towers Off Veer Savarkar Marg, Prabhadevi, Mumbai- 400025, Maharashtra, India

Date of Appointment :

10.09.1998

DIN No.:

00287029

 

 

Name :

Mr. Ranjit Vasant Pandit

Designation :

Director

Address :

Darbhanga Mansion, Flat No. 1 12, Carmichael Road, Mumbai- 400026, Maharashtra, India

Date of Appointment :

03.03.2015

DIN No.:

00782296

 

 

Name :

Mr. Vinay Bansal

Designation :

Director

Address :

7-S, Dilwara, M. Karve Road, Mumbai- 400021, Maharashtra, India

Date of Appointment :

24.07.2009

DIN No.:

01674284

 

 

Name :

Mr. Anant Vardhan Goenka

Designation :

Managing Director

Address :

Unit No. 209, 2nd Floor, Bezzola Complex, B Wing, Sion Trombay Road, Opposite Suman Nagar, Chembur, Mumbai- 400071, Maharashtra, India

Date of Appointment :

01.04.2012

DIN No.:

02089850

 

 

Name :

Ms. Punita Lal

Designation :

Director

Address :

909-B, The Aralias DLF Golf Links, Gurugram-122009, Haryana, India

Date of Appointment :

29.04.2014

DIN No.:

03412604

 

 

Name :

Pierre Eric Cohade

Designation :

Additional Director

Address :

72, Hua Ting Road, Shanghai-200031 China

Date of Appointment :

01.02.2018

DIN No.:

00468035

 

 

Name :

Mr. Arnab Mrinal Banerjee

Designation :

Wholetime Director

Address :

202-B, Aditya, S.V. Patel Nagar, Andheri (West) MUMBAI-400053, Maharashtra, India

Date of Appointment :

07.05.2013

DIN No.:

06559516

 

 

KEY EXECUTIVES

 

Name :

Ms. Shruti Ratnakar Joshi

Designation :

Company Secretary

Address :

PA-6, Mu.H.No.134, Plot No. 167, (B) Date Bhavan, C) Dr. Babasaheb Ambedkar Road, Mu.H.No.116, Dadar (East), Mumbai – 400014, Maharashtra, India

Date of Appointment :

01.09.2016

PAN No.:

AGKPJ4240M

 

 

Name :

Mr. Kumar Subbiah

Designation :

Chief financial officer

Address :

201, Kiara Apartments, Golf Link Union Park, Adjacent to Syndicate Bank, Pali Hill, Khar (West), Mumbai – 400050, Maharashtra, India

Date of Appointment :

16.01.2017

PAN No.:

AFUPK3543H

 

 

Name :

Ms. Namrata

Designation :

Treasury – Manager

 

 

Audit Committee:
  • Mr. Mahesh S. Gupta (Chairman)
  • Mr. S. Doreswamy (Member)
  • Mr. S. Doreswamy (Member)
  • Mr. Vinay Bansal (Member)

 

 

Stakeholders Relationship

Committee:
  • Mr. S. Doreswamy (Chairman)
  • Mr. Paras K. Chowdhary (Member)
  • Mr. S. Doreswamy (Member)

 

 

Nomination and Remuneration

Committee:
  • Mr. Mahesh S. Gupta (Chairman)
  • Mr. Paras K. Chowdhary (Member)
  • Mr. S. Doreswamy (Member)

 

 

Corporate Social Responsibility

Committee:
  • Mr. Anant Vardhan Goenka (Chairman)
  • Mr. Hari L. Mundra (Member)
  • Mr. Vinay Bansal (Member)

 

 

Risk Management Committee:
  • Mr. Mahesh S. Gupta (Chairman)
  • Mr. S. Doreswamy (Member)
  • Mr. Hari L. Mundra (Member)
  • Mr. Vinay Bansal (Member)

 

 

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

 

As on: DECEMBER

 

Category of shareholder

Total Nos. shares held

Shareholding as a % of total no. of shares (calculated as per SCRR, 1957) As a %

(A) Promoter & Promoter Group

20533744

50.76

(B) Public

19916348

49.24

Grand Total

40450092

100.00

 

 

 

 

STATEMENT SHOWING SHAREHOLDING PATTERN OF THE PROMOTER AND PROMOTER GROUP

 

Category of shareholder

Total Nos. shares held

Shareholding as a % of total no. of shares (calculated as per SCRR, 1957) As a %

A1) Indian

 

Individuals/Hindu undivided Family

148117

0.37

Harsh Vardhan Goenka

133932

0.33

Anant Vardhan Goenka

14185

0.04

Any Other (specify)

18603279

45.99

Instant Holdings Limited

11510812

28.46

Swallow Associates LLP

4484624

11.09

STEL Holdings Limited

1372835

3.39

Summit Securities Ltd

959125

2.37

Chattarpati Investments Ltd*

275876

0.68

Sudarshan Electronics and TV Ltd

1

0.00

Mr. Harsh Vardhan Goenka (in the Capacity Trustee of Stellar Energy Trust)

1

0.00

Mr. Harsh Vardhan Goenka (in the Capacity Trustee of Nucleus Life Trust)

1

0.00

Mr. Harsh Vardhna Goenka (in the Capacity Trustee of Crystal India Tech Trust)

1

0.00

Mr. Harsh Vardhan Goenka (in the Capacity Trustee of Monitor Portfolio Trust)

1

0.00

Mr. Harsh Vardhan Goenka (in the Capacity Trustee of Secura India Trust)

1

0.00

Mr. Harsh Vardhan Goenka (in the Capacity Trustee of Prism Estates Trust)

1

0.00

Sub Total A1

18751396

46.36

A2) Foreign

0.00

Any Other (specify)

1782348

4.41

Societe Ceat D Investissements EN Asie S A. SPF

1782348

4.41

Sub Total A2

1782348

4.41

A=A1+A2

20533744

50.76

 

 

STATEMENT SHOWING SHAREHOLDING PATTERN OF THE PUBLIC SHAREHOLDER

 

Category & Name of the Shareholders

Total No. shares held

Shareholding % calculated as per SCRR, 1957 As a %

B1) Institutions

 

Mutual Funds/

2020144

4.99

Mirae Asset Emerging Bluechip Fund**

1298891

3.21

Alternate Investment Funds

10250

0.03

Foreign Portfolio Investors

9672948

23.91

Amansa Holdings Private Limited

1579614

3.91

Jwalamukhi Investment Holdings

3253841

8.04

Financial Institutions/ Banks

28055

0.07

Insurance Companies

979356

2.42

Sub Total B1

12710753

31.42

B2) Central Government/ State Government(s)/ President of India

0.00

Central Government/ State Government(s)/ President of India

9700

0.02

Sub Total B2

9700

0.02

B3) Non-Institutions

0.00

Individual share capital upto INR 0.200 Million

4064159

10.05

Individual share capital in excess of INR 0.200 Million

81830

0.20

NBFCs registered with RBI

9881

0.02

Any Other (specify)

3040025

7.52

Trusts

93658

0.23

Bodies Corporate

787088

1.95

Unclaimed or Suspense or Escrow Account

137464

0.34

Clearing Members

567604

1.40

Limited Liability Partnership-LLP

29792

0.07

Overseas corporate bodies

1421412

3.51

Westbridge Crossover Fund, LLC

1421375

3.51

Director or Director's Relatives

3007

0.01

Sub Total B3

7195895

17.79

B=B1+B2+B3

19916348

49.24

 

 

BUSINESS DETAILS

 

Line of Business :

Manufacturing of Automotive Tyres, Tubes and Flaps. (Registered Activity)

 

 

Products :

NIC Code of the Product/

service

Product Description

22111

Automotive Tyres, Tubes and Flaps

 

 

Brand Names :

Not Available

 

 

Agencies Held :

Not Available

 

 

Exports :

Not Divulged

 

 

Imports :

Not Divulged

 

 

Terms :

Not Divulged

 

 

 

 

GENERAL INFORMATION

 

Suppliers :

 

Reference :

Not Divulged

Name of the Person :

--

Contact No.:

--

Since How Long Known :

--

Maximum Limit Dealt :

--

Experience :

--

Remark:

--

 

 

Customers :

 

Reference :

Not Divulged

Name of the Person :

--

Contact No.:

--

Since How Long Known :

--

Maximum Limit Dealt :

--

Experience :

--

Remark:

--

 

 

No. of Employees :

5580 (Approximately)

 

 

Bankers :

Banker Name :

Yes Bank

Branch :

1A, Mittal Chambers, Nariman Point, Mumbai – 400021, Maharashtra, India

Person Name (With Designation) :

--

Contact Number :

91-22-66749000/ 67478916

Name of Account Holder :

--

Account Number :

--

Account Since (Date/Year of Account Opening) :

--

Average Balance Maintained :

--

Credit Facilities Enjoyed (CC/OD/Term Loan) :

--

Account Operation :

--

Remark :

--

 

  • Bank of India
  • Bank of Baroda
  • State Bank of India
  • ICICI Bank
  • IDBI Bank Corporation Bank
  • Axis Bank
  • The Hongkong and Shanghai Banking Corporation Limited (HSBC)
  • Standard Chartered Bank
  • Kotak Mahindra Bank

 

 

Facilities :

(INR  In Million)

SECURED LOAN

As on

31.03.2017

As on

31.03.2016

Long-term Borrowings

 

 

Debentures

 

 

Non-convertible debentures

1995.000

1994.400

Indian rupee loan from banks

 

 

Hongkong and Shanghai Banking Corporation Ltd. (Refer note 5(2))

0.000

156.250

Export Import Bank of India (Refer note 5(3))

1083.318

752.508

Kotak Mahindra Bank Ltd. (Refer note 5(4))

294.321

293.527

HSBC Bank

697.802

0.000

Foreign currency loan from banks

0.000

0.000

Buyer's credit

2661.520

2122.566

 

 

 

Short-term borrowings

 

 

Cash credit facilities from banks (repayable on demand) (Refer foot note (a))

202.112

219.094

Export packing credit from banks (Refer foot note (a))

129.710

0.000

Total

7063.783

5538.345

 

 

Auditors :

 

Name :

S. R. Batliboi and Associates LLP

Chartered Accountants

Address :

14th Floor, The Ruby, 29 Senapati Bapat Marg, Dadar (West), Mumbai – 400028, Maharashtra, India

Tel. No. :

91-22-61920000

Fax No. :

91-22-61921000

 

Legal Adviser:
  • Mulla and Mulla and Craige
  • Blunt and Caroe

 

 

Audit Committee :
  • Mahesh S. Gupta (Chairman)
  • Hari L. Mundra (Member)
  • S. Doreswamy (Member)
  • Vinay Bansal (Member)

 

 

Debenture Trustee :

 

Name :

Axis Trustee Services Limited

Address :

Axis House, Ground Floor, E Wing, Axis House, Bombay Dyeing Mills Compound, Pandurang Budhkar Marg, Worli, Mumbai - 400 025, maharashtra, India

 

 

Memberships :

Not Available

 

 

Collaborators :

Not Available

 

 

Related parties where control exists:
  • Associated CEAT Holdings Company (Private) Limited (“ACHL”) (Subsidiary Company)
  • CEAT AKKHAN Limited (previously known as CEAT Bangladesh Limited) (Subsidiary Company)
  • Rado Tyres Limited (Subsidiary Company) (“Rado”)
  • CEAT Specialty Tyres Limited (“CSTL”) (Subsidiary Company) (w.e.f. December 8, 2014)

 

 

Related parties with whom transactions have taken place during the year:
  • CEAT-Kelani Holding Company (Private) Limited (“CKHL”) (Joint Venture of ACHL)
  • Associated CEAT (Private) Limited (“ACPL”) (Subsidiary of CKHL)
  • CEAT-Kelani International Tyres (Private) Limited (“CKITL”) (Subsidiary of CKHL)
  • CEAT Kelani Radials Limited (“CKRL”) (Subsidiary of CKHL)
  • Asian Tyres (Private) Limited (“ATPL”) (Subsidiary of CKITL)
  • RPG Enterprises Limited (“RPGE”)(Directors, KMP or their relatives are interested)
  • RPG Lifesciences Limited (“RPGLS”) (Directors, KMP or their relatives are interested)
  • Zensar Technologies Limited(“Zensar”) (Directors, KMP or their relatives are interested)
  • Raychem RPG (Private) Limited (“Raychem”) (Directors, KMP or their relatives are interested)
  • KEC International Limited (“KEC”) (Directors, KMP or their relatives are interested)
  • Vinar Systems Private Limited (“Vinar”) (Directors, KMP or their relatives are interested)
  • B.N. Elias & Company LLP (“B.N. Elias”) (Directors, KMP or their relatives are interested)
  • Swallow Associates LLP (“Swallow”) (Directors, KMP or their relatives are interested)
  • Atlantus Dwellings & Infrastructure LLP (“Atlantus”) (Directors, KMP or their relatives are interested)
  • Chattarpati Apartments LLP (“Chattarpati”) (Directors, KMP or their relatives are interested)
  • Allwin Apartments LLP (“Allwin”) (Directors, KMP or their relatives are interested)
  • Palacino Properties LLP (“Palacino”) (Directors, KMP or their relatives are interested)
  • Amber Apartments LLP (“Amber”) (Directors, KMP or their relatives are interested)
  • Khaitan and Company (“Khaitan”) (Directors, KMP or their relatives are interested)

 

 

CAPITAL STRUCTURE

 

AS ON 31.03.2017

 

Authorised Capital :

No. of Shares

Type

Value

Amount

 

 

 

 

46100000

Equity Shares

INR 10/- each

INR 461.000 Million

3900000

Preference Shares

INR 10/- each

INR 39.000 Million

10000000

Unclassified Shares

INR 10/- each

INR 100.000 Million

 

 

 

 

 

Total authorised share capital

 

INR 600.000 Million

 

Issued Capital :

 

No. of Shares

Type

Value

Amount

 

 

 

 

40450780

Equity Shares

INR 10/- each

INR 404.508 Million

 

 

 

 

 

Total issued share capital

 

INR 404.508 Million

 

Subscribed and paid-up :

 

No. of Shares

Type

Value

Amount

 

 

 

 

40450092

Equity Shares

INR 10/- each

INR 404.501 Million

 

 

 

 

 

Total subscribed and paid-up share capital

 

INR 404.501 Million

 

 

a) Includes 688 (March 31, 2016- 688; April 1, 2015- 688) equity shares offered on right basis and kept in abeyance.

 

ii) Terms and rights attached to Equity shares:

The Company has only one class of equity shares having face value of INR 10 per share. Each holder of equity shares is entitled to one vote per equity share. Dividend is recommended by the Board of Directors and is subject to the approval of the members at the ensuing Annual General Meeting. The Board of Directors have a right to deduct from the dividend payable to any member, any sum due from him to the Company.

 

In the event of winding-up, the holders of equity shares shall be entitled to receive remaining assets of the Company after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by shareholders. The shareholders have all other rights as available to equity shareholders as per the provision of the Companies Act, applicable in India read together with the Memorandum of Association and Articles of Association of the Company, as applicable.

 

Shares in the Company held by each shareholder holding more than 5% of the number of equity shares

 

Equity Shares

31.03.2017

 

Number of shares

% Holding

Instant Holdings Limited

11510812

28.46

Swallow Associates LLP

4484624

11.09

Kotak Mahindra (International) Limited

--

--

TIAA-CREF Institutional Mutual Fund International

--

--

 

d) As per the of the Company as at March 31, 2017 no calls remain unpaid by the directors and officers of the company.

e) The Company has not issued any equity shares as bonus for consideration other than cash and has not bought back any shares during the period of 5 years immediately preceeding March 31, 2017.

 

 

 

FINANCIAL DATA

[all figures are in INR Million]

 

ABRIDGED BALANCE SHEET

 

SOURCES OF FUNDS

31.03.2017

31.03.2016

31.03.2015

 

 

 

 

I.              EQUITY AND LIABILITIES

 

 

 

(1)Shareholders' Funds

 

 

 

(a) Share Capital

404.501

404.501

404.501

(b) Reserves & Surplus

22657.004

19086.054

15580.896

(c) Money received against share warrants

0.000

0.000

0.000

 

 

 

 

(2) Share Application money pending allotment

0.000

0.000

0.000

Total Shareholders’ Funds (1) + (2)

23061.505

19490.555

15985.397

 

 

 

 

(3) Non-Current Liabilities

 

 

 

(a) long-term borrowings

7035.061

5873.513

3543.241

(b) Deferred tax liabilities (Net)

2030.063

1480.884

1171.473

(c) Other long term liabilities

271.613

166.985

14.220

(d) long-term provisions

341.814

245.586

270.584

Total Non-current Liabilities (3)

9678.551

7766.968

4999.518

 

 

 

 

(4) Current Liabilities

 

 

 

(a) Short term borrowings

579.899

219.095

2568.403

(b) Trade payables

7495.788

6306.140

6331.092

(c) Other current liabilities

4754.499

4672.780

5435.100

(d) Short-term provisions

545.959

469.930

1042.684

Total Current Liabilities (4)

13376.145

11667.945

15377.279

 

 

 

 

TOTAL

46116.201

38925.468

36362.194

 

 

 

 

II.          ASSETS

 

 

 

(1) Non-current assets

 

 

 

(a) Fixed Assets

 

 

 

(i) Tangible assets

23406.153

19170.392

14249.527

(ii) Intangible Assets

682.467

576.565

563.370

(iii) Capital work-in-progress

487.723

2134.507

1640.659

(iv) Intangible assets under development

0.000

0.000

0.000

(b) Non-current Investments

1943.856

1843.856

1243.856

(c) Deferred tax assets (net)

395.165

373.413

0.000

(d)  Long-term Loan and Advances

19.542

27.392

612.187

(e) Other Non-current assets

945.553

328.232

87.692

Total Non-Current Assets

27880.459

24454.357

18397.291

 

 

 

 

(2) Current assets

 

 

 

(a) Current investments

642.688

400.552

3124.332

(b) Inventories

9234.370

6192.535

6421.070

(c) Trade receivables

5920.544

5779.430

6669.272

(d) Cash and cash equivalents

174.719

241.565

644.978

(e) Short-term loans and advances

500.204

340.384

952.038

(f) Other current assets

1763.217

1516.645

153.213

Total Current Assets

18235.742

14471.111

17964.903

 

 

 

 

TOTAL

46116.201

38925.468

36362.194

 

 

PROFIT & LOSS ACCOUNT

 

 

PARTICULARS

31.03.2017

31.03.2016

31.03.2015

 

SALES

 

 

 

 

Income

63765.180

61187.326

55916.646

 

Other Income

414.573

460.851

286.325

 

TOTAL

64179.753

61648.177

56202.971

 

 

 

 

 

Less

EXPENSES

 

 

 

 

Cost of Materials Consumed

33088.821

29537.828

32589.932

 

Purchases of Stock-in-Trade

1425.500

1381.646

1197.628

 

Changes in inventories of finished goods, work-in-progress and Stock-in-Trade

(761.511)

(23.227)

562.739

 

Employees benefits expense

3838.500

3690.540

3498.533

 

Excise Duty

6747.927

6636.774

0.000

 

Exceptional items

133.255

113.999

61.320

 

Other expenses

12825.984

12031.082

11681.076

 

TOTAL

57298.476

53368.642

49591.228

 

 

 

 

 

 

PROFIT / (LOSS) BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION

6881.277

8279.535

6611.743

 

 

 

 

 

Less

FINANCIAL EXPENSES

794.689

933.164

1304.630

 

 

 

 

 

 

PROFIT / (LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION

6086.588

7346.371

5307.113

 

 

 

 

 

Less

DEPRECIATION/ AMORTISATION

1420.084

1068.415

878.487

 

 

 

 

 

 

PROFIT/ (LOSS)  BEFORE TAX

4666.504

6277.956

4428.626

 

 

 

 

 

Less

TAX

1039.246

1826.173

1438.887

 

 

 

 

 

 

PROFIT/ (LOSS)  AFTER TAX 

3627.258

4451.783

2989.739

Add

PREVIOUS YEARS’ BALANCE BROUGHT FORWARD 

11552.135

7730.195

5193.723

 

 

 

 

 

Less

APPROPRIATIONS

 

 

 

 

Proposed Dividend on Equity Shares

NA

465.176

404.501

 

Corporate Tax on Proposed Dividend

NA

71.411

48.766

 

Transferred to debenture redemption reserve

NA

166.700

0.000

 

Total

NA

703.287

453.267

 

 

 

 

 

 

Balance Carried to the B/S

NA

11552.135

7730.195

 

 

 

 

 

 

EARNINGS IN FOREIGN CURRENCY

 

 

 

 

Export Sales calculated on FOB basis

7098.271

9780.098

 

Royalty

 

55.312

44.271

 

Dividend

 

116.786

95.060

 

Technical Development Charges

 

0.000

7.000

 

TOTAL EARNINGS

7758.948

7270.369

9926.429

 

 

 

 

 

 

IMPORTS

 

 

 

 

Raw Materials

11608.312

13663.165

 

Traded Goods

 

789.807

354.605

 

Components & Spares

 

44.659

50.953

 

Capital Goods

 

3006.261

577.887

 

TOTAL IMPORTS

NA

15449.039

14646.610

 

 

 

 

 

 

Earnings / (Loss) Per Share (INR)

 

 

 

 

Basic

89.67

110.06

79.76

 

Diluted

89.67

110.06

79.76

 

 

 

CURRENT MATURITIES OF LONG TERM DEBT DETAILS

 

Particulars

 

31.03.2017

31.03.2016

31.03.2015

Current Maturities of Long term debt

135.492

417.290

1481.907

Cash generated from operations

4432.017

8829.792

8054.881

Net cash flows from (used in) operating activities

3440.774

7184.966

7052.066

 

 

 

    QUARTERLY RESULTS

 

PARTICULARS

 

30.06.2017

(Unaudited)

30.09.2017

 (Unaudited)

31.12.2017

 (Unaudited)

Net Sales

16199.700

 

 

Total Expenditure

15660.100

 

 

PBIDT (Excl OI)

539.600

 

 

Other Income

314.300

 

 

Operating Profit

853.900

 

 

Interest

221.600

 

 

Exceptional Items

(3.500)

 

 

PBDT

628.800

 

 

Depreciation

393.400

 

 

Profit Before Tax

235.400

 

 

Tax

44.000

 

 

Provisions and contingencies

NA

 

 

Profit After Tax

191.400

 

 

 

 

KEY RATIOS

 

EFFICIENCY RATIOS

 

PARTICULARS

 

31.03.2017

31.03.2016

31.03.2015

Average Collection Days

(Sundry Debtors / Income * 365 Days)

33.89

34.48

43.53

 

 

 

 

Account Receivables Turnover

(Income / Sundry Debtors)

10.77

10.59

8.38

 

 

 

 

Average Payment Days

(Sundry Creditors / Purchases * 365 Days)

79.27

74.44

68.39

 

 

 

 

Inventory Turnover

(Operating Income / Inventories)

0.75

1.34

1.03

 

 

 

 

Asset Turnover

(Operating Income / Net Fixed Assets)

0.28

0.38

0.40

 

LEVERAGE RATIOS

 

PARTICULARS

 

31.03.2017

31.03.2016

31.03.2015

Debt Ratio

((Borrowing + Current Liabilities) / Total Assets)

0.45

0.46

0.56

 

 

 

 

Debt Equity Ratio

(Total Liability / Networth)

0.34

0.33

0.48

 

 

 

 

Current Liabilities to Networth

(Current Liabilities / Net Worth)

0.58

0.60

0.96

 

 

 

 

Fixed Assets to Networth

(Net Fixed Assets / Networth)

1.07

1.12

1.03

 

 

 

 

Interest Coverage Ratio

(PBIT / Financial Charges)

8.66

8.87

5.07

 

PROFITABILITY RATIOS

 

PARTICULARS

 

 

31.03.2017

31.03.2016

31.03.2015

Net Profit Margin

 (PAT / Sales) * 100)

%

5.69

7.28

5.35

 

 

 

 

 

Return on Total Assets

((PAT / Total Assets) * 100)

%

7.87

11.44

8.22

 

 

 

 

 

Return on Investment (ROI)

((PAT / Networth) * 100)

%

15.73

22.84

18.70

 

SOLVENCY RATIOS

 

PARTICULARS

 

31.03.2017

31.03.2016

31.03.2015

Current Ratio

(Current Assets / Current Liabilities)

1.36

1.24

1.17

 

 

 

 

Quick Ratio

((Current Assets – Inventories) / Current Liabilities)

0.67

0.71

0.75

 

 

 

 

G-Score Ratio Financial

(Networth / Total Assets)

0.50

0.50

0.44

 

 

 

 

G-Score Ratio Debt

(Debts / Equity Capital)

19.16

16.09

18.77

 

 

 

 

G-Score Ratio Liquidity

(Total Current Assets / Total Current Liabilities)

1.36

1.24

1.17

Total Liability = Short-term Debt + Long-term Debt + Current Maturities of Long-term debts

 

 

STOCK PRICES

 

Face Value

INR 10.00/-

Market Value

INR 1600.75/-

 

 

 

FINANCIAL ANALYSIS

[all figures are in INR  Million]

 

DEBT EQUITY RATIO

 

Particular

31.03.2015

31.03.2016

31.03.2017

 

INR In Million

INR In Million

INR In Million

Share Capital

404.501

404.501

404.501

Reserves & Surplus

15580.896

19086.054

22657.004

Money received against share warrants

0.000

0.000

0.000

Share Application money pending allotment

0.000

0.000

0.000

Net worth

15985.397

19490.555

23061.505

 

 

 

 

Long-term borrowings

3543.241

5873.513

7035.061

Short term borrowings

2568.403

219.095

579.899

Current Maturities of Long term debt

1481.907

417.290

135.492

Total borrowings

7593.551

6509.898

7750.452

Debt/Equity ratio

0.475

0.334

0.336

 

 

YEAR-ON-YEAR GROWTH

 

Year on Year Growth

31.03.2015

31.03.2016

31.03.2017

 

INR In Million

INR In Million

INR In Million

Sales

55916.646

61187.326

63765.180

 

 

9.426

4.213

 

 

NET PROFIT MARGIN

 

Net Profit Margin

31.03.2015

31.03.2016

31.03.2017

 

INR In Million

INR In Million

INR In Million

Sales

55916.646

61187.326

63765.180

Profit/ (Loss)

2989.739

4451.783

3627.258

 

5.35%

7.28%

5.69%

 

 

 

ABRIDGED BALANCE SHEET (CONSOLIDATED)

 

SOURCES OF FUNDS

31.03.2017

31.03.2016

 

 

 

I.              EQUITY AND LIABILITIES

 

 

(1)Shareholders' Funds

 

 

(a) Share Capital

404.501

404.501

(b) Reserves & Surplus

23745.042

20142.893

(c) Money received against share warrants

0.000

0.000

 

 

 

(d) Share Application money pending allotment

0.000

0.000

(2) Minority Interest

291.453

322.446

Total Shareholders’ Funds (1) + (2)

24440.996

20869.840

 

 

 

(3) Non-Current Liabilities

 

 

(a) long-term borrowings

8524.326

5879.115

(b) Deferred tax liabilities (Net)

2133.453

1581.991

(c) Other long term liabilities

313.100

167.620

(d) long-term provisions

363.310

267.058

Total Non-current Liabilities (3)

11334.189

7895.784

 

 

 

(4) Current Liabilities

 

 

(a) Short term borrowings

579.899

335.364

(b) Trade payables

7582.135

6353.212

(c) Other current liabilities

5378.310

5155.565

(d) Short-term provisions

538.159

470.336

Total Current Liabilities (4)

14078.503

12314.477

 

 

 

TOTAL

49853.688

41080.101

 

 

 

II.          ASSETS

 

 

(1) Non-current assets

 

 

(a) Fixed Assets

 

 

(i) Tangible assets

23832.900

19733.037

(ii) Intangible Assets

692.400

587.664

(iii) Capital work-in-progress

3192.819

2982.379

(iv) Intangible assets under development

69.760

8.436

(v) Goodwill Consolidation

0.000

0.000

(b) Non-current Investments

1673.328

1552.819

(c) Deferred tax assets (net)

395.944

688.137

(d) Long-term Loan and Advances

0.753

28.394

(e) Other Non-current assets

1576.087

566.569

Total Non-Current Assets

31433.991

26147.435

 

 

 

(2) Current assets

 

 

(a) Current investments

642.688

402.124

(b) Inventories

9434.827

6397.110

(c) Trade receivables

6137.985

5935.104

(d) Cash and cash equivalents

359.207

630.338

(e) Short-term loans and advances

12.747

28.006

(f) Other current assets

1832.243

1539.984

Total Current Assets

18419.697

14932.666

 

 

 

TOTAL

49853.688

41080.101

 

 

PROFIT & LOSS ACCOUNT (CONSOLIDATED)

 

 

PARTICULARS

31.03.2017

31.03.2016

 

SALES

 

 

 

Income

64413.010

61459.174

 

Other Income

186.286

276.794

 

TOTAL

64599.296

61735.968

 

 

 

 

Less

EXPENSES

 

 

 

Cost of Materials Consumed

33088.819

29537.828

 

Purchases of Stock-in-Trade

1663.752

1484.551

 

Changes in inventories of finished goods, work-in-progress and Stock-in-Trade

(754.861)

(113.875)

 

Excise Duty

6747.866

6623.655

 

Exceptional items

133.255

113.999

 

Employees benefits expense

4063.092

3882.513

 

Other expenses

13036.547

12312.449

 

TOTAL

57978.470

53841.120

 

 

 

 

Less

PROFIT/ (LOSS)  BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION

6620.826

7894.848

 

 

 

 

Less

FINANCIAL EXPENSES

817.213

948.855

 

 

 

 

 

PROFIT / (LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION

5803.613

6945.993

 

 

 

 

Less

DEPRECIATION/ AMORTISATION

1430.807

1077.200

 

 

 

 

 

PROFIT/ (LOSS)  BEFORE TAX

4372.806

5868.793

 

 

 

 

Less

TAX

1064.184

1873.392

 

 

 

 

 

PROFIT/ (LOSS)  AFTER TAX

3308.622

3995.401

 

 

 

 

 Add:

SHARE OF PROFIT FROM JOINT VENTURE

283.675

361.793

 

 

 

 

 

NET PROFIT FOR THE YEAR

3592.297

4357.194

 

 

 

 

Add:

OTHER COMPREHENSIVE INCOME

7173.451

8740.244

 

 

 

 

 

TOTAL COMPREHENSIVE INCOME FOR THE YEAR PROFIT

10765.748

13097.438

 

 

 

 

 

EARNINGS / (LOSS) PER SHARE (INR)

89.28

108.17

 

 

LEGAL CASES

 

HIGH COURT OF BOMBAY

CASE DETAILS

BENCH: BOMBAY

Presentation Date:- 25/02/2015

Lodging No.:-

ITXAL/213/2016

Filing Date:-

25/02/2016

Reg. No.:-

ITXA/670/2016

Reg. Date:-

21/04/2016

 

Petitioner: THE PRINCIPAL COMMISSIONER OF INCOME TAX -         Respondent: CEAT LIMITED

 

Petn. Adv : A R Malhotra (I3164)        Resp. Adv.: ATUL KARSANDAS JASANI (33)

 

District: MUMBAI

 

Bench: DIVISION

 

Status: Pre-Admission                                                     Category: Tax Appeals 

 

Next Date:- 18/12/2017                                                    Stage: --

 

Coram:- ACCORDING TO SITTING LIST

              ACCORDING TO SITTING LIST

Act:  Income Tax Act, 1961                          UNDER SECTION: 260 A

 

 

LOCAL AGENCY FURTHER INFORMATION

 

Sr. No.

Check list by info agents

Available in Report (Yes/No)

1

Year of establishment

Yes

2

Constitution of the entity -Incorporation details

Yes

3

Locality of the entity

Yes

4

Premises details

No

5

Buyer visit details

-

6

Contact numbers

Yes

7

Name of the person contacted

Yes

8

Designation of contact person

Yes

9

Promoter’s background

Yes

10

Date of Birth of Proprietor / Partners / Directors

Yes

11

Pan Card No. of Proprietor / Partners

No

12

Voter Id Card No. of Proprietor / Partners

No

13

Type of business

Yes

14

Line of Business

Yes

15

Export/import details (if applicable)

No

16

No. of employees

Yes

17

Details of sister concerns

Yes

18

Major suppliers

No

19

Major customers

No

20

Banking Details

Yes

21

Banking facility details

Yes

22

Conduct of the banking account

--

23

Financials, if provided

Yes

24

Capital in the business

Yes

25

Last accounts filed at ROC, if applicable

Yes

26

Turnover of firm for last three years

Yes

27

Reasons for variation <> 20%

--

28

Estimation for coming financial year

No

29

Profitability for last three years

Yes

30

Major shareholders, if available

Yes

31

External Agency Rating, if available

Yes

32

Litigations that the firm/promoter involved in

Yes

33

Market information

---

34

Payments terms

No

35

Negative Reporting by Auditors in the Annual Report

No

 

 

CORPORATE INFORMATION

 

Subject is a public company domiciled in India and incorporated under the provisions of the Companies Act applicable in India. The Company’s principal business is manufacturing of automotive tyres, tubes and flaps. The Company started operations in 1958 as CEAT Tyres of India Limited and was renamed as CEAT Limited in 1990. The Company caters to both domestic and international markets. The company’s stock are listed on two recognized stock exchanges in India. The registered office of the company is located at RPG House, 463, Dr. Annie Besant Road, Worli, Mumbai, Maharashtra 400030. The financial statements were authorised for issue in accordance with a resolution of the directors on April 28, 2017.

 

FINANCIAL HIGHLIGHTS

 

On standalone basis, the Company recorded net revenue from operations of INR 63765.180 Million with a increase of 4.21% over INR 61181.326 Million of the last fiscal. The Company recorded a net profit of INR 3627.258 Million negative a decrease of 18.52% over net profit of INR 4451.783 Million of the last fiscal. CEAT continued to be one of the fastest growing tyre Companies in India, for a second year in a row, with a four year Revenue CAGR of 5.3% and a four year PAT CAGR of 178.42%.

 

MANAGEMENT DISCUSSION AND ANALYSIS

 

COMPANY OVERVIEW:

 

CEAT is one of India’s leading tyre manufacturers with a global presence. CEAT produces over 26 million tyres a year, with a wide range of radial and bias tyres for both commercial and passenger vehicle segments. It is dedicated to the passionate pursuit of excellence in performance and quality through a range of distinctive products. The brand stands for safer and smarter mobility and the Company strives for delivering high and consistent quality products that ensure safety of its consumers and make their drive a pleasurable one.

 

In the last 5 (five) years, it has emerged as the fastest growing company in the industry in terms of revenue growth. Driven by its purpose of ‘Making Mobility Safer & Smarter. Everyday.’ And governed by its core values of ‘CAIRO’*, CEAT is committed to long-term value creation for all its stakeholders. During the same period, the Company has delivered the highest returns to shareholders in tyre industry in India.

 

In last few years, the industry has witnessed high growth rates in the passenger cars, utility vehicle and two-wheeler segments. In keeping with the trend, CEAT decided to focus on these segments about six years ago. Since then, it has been consistently investing in brand building, innovative product development and extensive expansion of its distribution network. Going forward, the Company has committed an investment of INR 28000.000 million over the period of next 5 (five) years. The greenfield facility for two and three-wheeler tyres (Nagpur) and brownfield facility for passenger car and utility vehicle tyres (Halol) have already been commissioned and are under rampup currently.

 

During FY 2016-17, CEAT has been ranked No. 1 in India for customer satisfaction in passenger car and utility vehicle tyre segment, according to the J.D. Power 2017 India Original Equipment Tyre Customer Satisfaction Index (TCSI) Study. The result is a testimony to CEAT’s continued focus on developing best-in-class products through a robust customer insighting process backed by a strong Research and Development (R&D) team. CEAT has also received ‘Sword of Honor’, the highest manufacturing excellence award by the British Safety Council for its Halol plant recently, emphasising CEAT’s thrust on safety

 

 

GLOBAL ECONOMY

 

The world economic growth rate remained subdued at 3.1% in 2016. This was largely due to the turbulences in the world markets during the first half of the year. Brexit, China’s slowdown, low oil prices and overall economic weakness in Japan, the US and Europe were primarily responsible for slow economic growth.

 

Moreover, the recovery of global economy was weighed down by spillover effects of Brexit and uncertain trade policies of the new White House regime; both of which led to unpredictable policies cautioning investors. Besides, the tightening purse of the US Federal Reserve dampened private investments further hurting global growth prospects.

 

Meanwhile, in the advanced economies, these setbacks were offset by ‘stronger than expected’ economic activities during the second half of 2016. This was clearly visible in the US, displaying a decelerated unemployment rate; and in the UK which witnessed a rise in domestic demand following Brexit. These higher than

expected changes in advanced economies set in motion a growth trend. If this trend continues, the world economy is expected to pick up steam in 2017 and grow by 3.4%.

 

 

USA: The projected growth for the US economy has been revised upward by the International Monetary Fund (IMF). This reflects the assumed fiscal policy easing and an upswing in confidence, especially after the Presidential elections. If such a scenario persists, it will reinforce the cyclical momentum. There is however, pervasive uncertainty around policy shifts.

 

 

Euro Zone: Clouded by Brexit and slowdown in major economies of the region, such as Germany, Spain and Italy,

the Eurozone’s economic performance is expected to remain insipid, predicts IMF. Moreover, the medium-term outlook for the region as a whole remains dim due to weak productivity, adverse demographics and election uncertainties.

 

Japan: IMF upgraded its forecast for Japan’s GDP growth in 2017 to 1.2% owing to increased exports. However, the declining fiscal stimulus in 2018, is likely to bring down its GDP to 0.6%. Moreover, inflation due to higher fresh food prices and fading effects of the earlier appreciation of yen will influence the economy. Moreover, the country’s dwindling labour force is likely to bring problems for the economy in the long term.

 

United Kingdom: Economic growth held up better than expected in the second half of 2016, but has stumbled in 2017. Rising inflation, driven by the depreciation of sterling, is likely to squeeze household income and depress consumer spending, which has been the primary driver of economic growth in recent years. Besides, a hung parliament after the snap general election will further jeopardise firm policy initiatives to drive economic growth.

 

Emerging Market and Developing Economies (EMDEs):

 

 

EMDEs are projected to grow by 4.5% in 2017. Among these economies, China is expected to show strong growth at 6.5% (compared to the previous estimate of 6.2%). This is because Chinese administration is directing policy stimulus measures into the economy. However, moderation in growth prospects is expected among large economies such as Brazil and Mexico.

 

CRUDE OIL PRICE

 

Crude oil prices remained between USD 44 to USD 54 per barrel during FY 2016-17, notwithstanding Organisation of the Petroleum Exporting Countries’ (OPEC) efforts to cut production and stabilise the market. As India imports a large portion of its oil requirements, lower oil prices helped benefit India’s economy.

 

 

 

INDIAN ECONOMY

 

India continues to be one of the fastest growing major economies in the world, reporting a robust GDP growth of 7.1% in FY 2016-17. Government’s bold measures on many fronts are helping India reach its true potential. India’s fundamental economic indicators - inflation, fiscal deficit, and current account deficit – showed reduction. India’s FDI inflows stood at a record USD 60.1 billion in FY 2016-17.

 

 

The Global Tyre Industry

 

Trends in the automobile industry decide the growth trajectory for tyre companies to a large extent. Today, the global automakers are faced with a number of challenges such as rapidly changing macroeconomic conditions, shift in consumer behaviour, growing environmental concerns and unprecedented technological advancements among others. In the fiscal year under review, developed economies witnessed an uptick in the production and sales of vehicles, whereas emerging markets saw decelerating trends.

 

FUTURE OUTLOOK

 

According to reports by research agencies India could grow at a potential of 7.7 - 8 % during the period 2016 to 2020 powered by greater access to banking, technology adoption, urbanisation and other structural reforms. According, to ICRA, domestic tyre demand is expected to grow by 6-7% over the next two-three years ending FY 2018-19, supported by a broad based revival in Original Equipment (OE) demand and economic activity in the country. Pick up in rural expenditure with good monsoon would translate into higher OEM demand for the rural centric two-wheeler and tractor segments. Growing fleet on ground and higher miles driven/ freight moved would drive replacement sales. The future outlook of the tyre industry is therefore expected to be stable. The Company expects to continue the growth path gaining share in the two-wheeler, passenger car and utility vehicles segment. It also expects to increase its market share in the TBR segment. The Company shall continue to focus on increasing capacities, enhancing brand visibility, new product development and service innovation. 

 

 

GLOBAL TYRE INDUSTRY

 

Tyre industry is a capital-intensive industry which has to make heavy investments for creating capacity. Currently, global tyre industry is valued over USD 80 billion of which Passenger Vehicles (PV) tyre, Truck and Bus (T&B) vehicles tyre, and Off Highway Tyres (OHT) constitute around 90% share. The global automotive industry is constantly evolving to keep pace with the changing customer preferences, technological advancements and regulatory landscape.  Global tyre industry has expanded at a steady rate in last few years along with the growth in international automobile market. During the last seven years, the tyre industry has grown at a compounded annual growth rate (CAGR) of around 4.5%. In 2016, the global tyre market produced more than 2.9 billion units (Source: Business Wire).  The growth of the global tyre industry is driven by rising income levels, increased urbanisation, and fast economic growth in the developing countries. Rise in disposable incomes leading to increased purchasing power of consumers, worldwide, has significantly propelled the demand of automobiles and tyres globally.

 

As countries seek to address energy efficiency issues and reduce emissions of greenhouse gases, development in sustainable and green mobility have become a global agenda. Electric vehicles, in particular, offer a spectrum of opportunities to reduce emission, increase energy security and improving fuel efficiency. About 1.3 million electric vehicles were sold worldwide in 2016, registering a growth of 76% on YoY basis (Source: ATMA).

 

Currently, China is the world’s largest market for tyres. The Chinese automobile industry has grown at a tremendous pace. It has catalysed the development of the country’s tyre sector, both in terms of production as well as consumption. The operating rate of the Chinese market rebounded significantly in 2016, showing an uptrend in the off-season after October.

 

In 2016, export value of China was USD 12.89 billion, down by 6.9% on YoY basis. The value of tyres exported from China to the US was USD 2.1 billion, accounting for 16.3% of China’s total export value of tyres in the same duration. Due to anti-dumping and countervailing duty imposed by the US administration, Chinese imports in Truck and Bus categories suffered a setback and fell below USD 1 billion in first eleven months of 2016. However, these duties were rolled back in February 2017. The UK was the second largest market for Chinese exports. In 2016, the value of tyres exported from China to the UK was USD 0.54 billion, accounting for 4.2% of China’s total export value of tyres.

 

USA’s automobile market is the second largest automobile market in the world. Increasing disposable income due to strengthening US Dollar, falling oil and food prices and rising standard of living are resulting in an increase in production and vehicle sales in the US. Steady growth in sales and production of automobiles, expanding automobile fleet and favourable government policies are anticipated to propel growth in the US tyre market over the next five years (Source: Business Wire).

 

Europe continues to be the epicentre of all major global advancements in tyre technology. The European tyre market is predicted to grow at a CAGR of 5% during 2014-2019. All the three zones - Western, Central and Eastern Europe are expected to contribute to this growth. Tyre categories especially Passenger Cars (PC), Light Commercial Vehicles (LCV) and Medium and Heavy Commercial Vehicles (M&HCV) will witness most of this growth.

 

Germany, the UK, France, Italy, Spain and Poland are the major markets that contribute to more than 60% of the total Europe tyre sales in volume terms.

 

By 2020, passenger cars and light commercial vehicle sales are likely to reach about 16.9 million units in Western Europe, about 3.7 million units in Central Europe and 4.6 million units in Eastern Europe. Passenger vehicle is the dominant segment in European tyre market. Moreover, it is forecasted that commercial vehicle tyre market will grow at a healthy rate due to an anticipated surge in the construction activities in Europe, especially Eastern Europe, in next few years (Source: TechSci Research).

 

Asia-Pacific is emerging as a hub for production of automobiles,  with the automotive sector accounting for the largest private sector investment in R&D in the region.  Presence of major automotive OEMs such as Ford, Hyundai, Honda, Mahindra, Maruti Suzuki, TATA and BMW among others Increasing tyre radialisation, growing demand for Chinese tyres and proliferation of the used car market is anticipated to drive demand for tyres in Africa further during 2016-2022.

 

EXPORT

 

India’s tyre export has increased at a steady rate of 6% in the last 10 years. However, year 2016 witnessed a muted growth of about 1%. In volume terms, two-wheeler tyres registered the fastest growth of 17%, followed by passenger vehicle tyres (13%) and truck and bus tyres (12%). Exports to top 10 countries represent nearly half of the tyre exports from India, with USA, Germany and UAE absorbing about 25% of exports (in value terms). Exports grew at sharp rate in most of the key destinations, barring Brazil and Pakistan. India does not have any Foreign Trade Agreements (FTAs)/ Regional Trade Agreements (RTAs) with top economies like USA and EU countries that could provide concessions on tariffs for its exported tyres. Tyre industry is largely dependent on natural rubber, synthetic rubber and crude derivatives that are largely imported and heavily taxed, which reduces exports competitiveness of the industry. Also, natural rubber falls under negative list of all FTAs/RTAs except Sri Lanka, which impacts the competitiveness of India’s tyre industry.

 


IMPORT

 

Total tyres imported in India declined by 3% in FY 2016-17 on YoY basis. Following demonetisation, the last four months of the year 2016-17 witnessed significant declines in total tyre import.

 

 

UNSECURED LOAN

 

Particulars

As on

31.03.2017

As on

31.03.2016

Long-term Borrowings

 

 

Public deposits

0.020

215.376

Deferred sales tax incentive

303.080

338.886

 

 

 

Short-term borrowings

 

 

Commercial paper

248.077

0.000

Total

551.177

554.262

 

 

INDEX OF CAHREGS:

 

SNO

SRN

CHARGE ID

CHARGE HOLDER NAME

DATE OF CREATION

DATE OF MODIFICATION

DATE OF SATISFACTION

AMOUNT

ADDRESS

1

G48773899

100110913

VISTRA ITCL (INDIA) LIMITED

30/06/2017

-

-

20000000000.0

IL & FS FINANCIAL CENTREPLOT NO C22 G BLOCK BANDRAKURLA COMPLEX BANDRA EASTMUMBAIMa400051IN

2

G34687681

100030795

State Bank of India

19/05/2016

10/01/2017

-

1000000000.0

Neville House, J. N. Heredia Marg, Ballard Estate,MumbaiMH400001IN

3

C70741442

10608720

Axis Trustee Services Limited

30/10/2015

-

-

2000000000.0

Axis House, 2nd Flr, Bombay Dyeing Mills Compound,Pandurang Budhkar Marg, Worli,MumbaiMH400025IN

4

G08634859

10540073

Bank of India

10/12/2014

08/07/2016

-

1500000000.0

Mumbai Large Corporate Branch, 70/80,M. G. RoadMumbaiMH400023IN

5

G08651713

10540875

Export-Import Bank of India

10/12/2014

08/07/2016

-

1600000000.0

Centre One Building, Floor 21,World Trade Centre Complex, Cuffee ParadeMumbaiMH400005IN

6

G08652935

10540888

KOTAK MAHINDRA BANK LIMITED

10/12/2014

08/07/2016

-

1450000000.0

27BKC, C 27, G BlockBandra Kurla Complex, Bandra (E),MumbaiMH400051IN

7

C67592865

80004608

Bank of India

23/07/1993

24/09/2015

-

14000000000.0

Mumbai Large Corporate Branch,Oriental Building, 364, D. N. Road,MumbaiMH400001IN

8

G83271957

10247473

ICICI BANK LIMITED

21/10/2010

-

20/03/2018

1164600000.0

LANDMARKRACE COURCE CIRCLEALKAPURIBARODAGJ390015IN

9

G81279614

10230552

Export-Import Bank of India

21/06/2010

-

12/03/2018

1000000000.0

Centre One Building, Floor 21World Trade Centre Complex, Cuffe ParadeMumbaiMH400005IN

10

G79171823

10212609

Bank of India

19/03/2010

21/06/2010

01/03/2018

1000000000.0

Mumbai Large Corporate Branch, Bank of India Bldg4th Floor, 70-80, Mahatma Gandhi Road,MumbaiMH400001IN

 

 

CONTINGENT LIABILITIES:

 

(INR in Million)

PARTICULARS

31.03.2017

Direct and indirect taxation matters

 

Income tax

431.665

Wealth tax

0.673

Excise duty / Service tax

787.934

Sales tax

702.420

Bills discounted with banks

729.472

Claims against the Company not acknowledged as debts*

 

In respect of labour matters

67.839

Rental disputes

18.000

Customer disputes

44.600

Vendor disputes

29.383

Other claims

320.711

Corporate Guarantee upto INR 2280.000 lacs to Ceat Specialty Tyres Limited as a collateral security for raising the

term loans

1347.698

 

 

 

UNAUDITED STANDALONE FINANCIAL RESULTS FOR THE QUARTER ENDED AND NINE MONTHS DECEMBER 31, 2017

 

[INR IN MILLION]

 

PARTICULARS

3 Months

9 Months

 

31.12.2017

30.09.2017

31.12.2017

 

[Unaudited]

[Unaudited]

[Unaudited]

1. Income from Operations

 

 

 

Net Sales/income from operations

15499.300

15118.200

46817.200

Other Operating Income

86.500

84.000

484.700

Total income from operations (net)

15585.800

15202.200

47301.900

 

 

 

 

Expenses

 

 

 

Cost of materials consumed

9502.400

8088.400

27088.800

Purchases of stock-in trade

187.400

106.600

410.500

Changes in inventories of finished goods. work-in-progress and stock in trade

(585.700)

1002.900

454.000

Employee benefits expense

1055.500

1051.500

3068.600

Depreciation and Amortization Expenses

405.200

406.200

1204.900

Other Expenses

3421.800

3056.000

9836.000

Finance Costs

217.300

232.800

671.700

Excise Duty

0.000

0.000

1689.100

Total expenses

14203.900

13944.400

44423.600

Profit/ (Loss) from ordinary activities after finance cost but before exceptional items

1381.900

1257.800

2878.300

Exceptional items

8.500

5.600

17.600

Profit/ (Loss) from ordinary activities before tax

1373.400

1252.200

2860.700

Tax expenses

463.500

417.300

924.900

Net Profit / (Loss) from ordinary activities after tax

909.900

834.900

1935.800

Extraordinary item (net of tax expense)

0.000

0.000

0.000

Net Profit / (Loss) for the period

909.900

834.900

1935.800

Comprehensive Income

27.100

29.900

45.900

Net Profit/ (Loss) after taxes, minority interest and share of profit/(loss) of associates

937.000

864.800

1981.700

 

 

 

 

Paid up equity share capital (Face Value of INR 10/-each)

404.500

404.500

404.500

Reserve excluding Revaluation Reserve as per Balance Sheet of previous accounting year

 

 

 

Earnings per share (before extraordinary items) of INR 10/- each (not annualized):

 

 

 

(a) Basic

22.49

20.64

47.86

(b) Diluted

22.49

20.64

47.86

 

 

Note:

 

1.     The financial results of the Company have been prepared in accordance with the Indian Accounting Standards (“Ind AS”) as prescribed under section 133 of the Companies Act , 2013 read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. 

2.     The above results of the Company have been reviewed by the Audit Committee at their meeting held on January 31, 2018 and thereafter approved by the Board of Directors at their meeting held on February 1, 2018. The statutory auditors have carried out limited review of the same. 

3.     With effect from July 01, 2017, Goods and Service Tax (‘GST’) has been implemented which has replaced several indirect taxes including excise duty. While Ind AS required excise duty to be included while computing revenues, GST is required to be excluded from revenue computation. Accordingly, ‘Revenue from operations (Net of excise duty)’ has been additionally disclosed in these results to enhance comparability of financial information. 

4.     The Company had introduced a Voluntary Retirement Scheme (VRS) for its employees. The compensation in respect of employees who opted for VRS aggregated to INR 8.500 Million for quarter ended December 31, 2017, INR 5.600 Million for quarter ended September 30, 2017, INR 17.600 Million for nine months ended December 31, 2017, INR 87 Million for nine months ended December 31, 2016 and INR 133.300 Million for year ended March 31, 2017 has been disclosed as an exceptional item. 

5.     During the quarter, the Company made an additional investment of INR 700.000 million in CEAT Specialty Tyres Limited, its wholly owned subsidiary company, by subscribing to 70,00,000 equity shares of INR 10 each fully paid up at a premium of INR 90 per share. 

6.     The Company’s business activity falls within a single reportable business segment, viz. “Automative Tyres, Tubes and Flaps”.

 

 

FIXED ASSETS

 

Tangible Assets

·         Land

·         Buildings

·         Plants and Equipment’s

·         Furniture and Fixtures

·         Office Equipment’s

·         Vehicles

 

Intangible Assets

·         Software

·         Brand

·         Technical Knowhow

 

 

 

 

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

INR

US Dollar

1

INR 65.35

UK Pound

1

INR 92.70

Euro

1

INR 80.80

 

 

INFORMATION DETAILS

 

Information Gathered by :

SHY

 

 

Analysis Done by :

PYK

 

 

Report Prepared by :

MTN

 

 

SCORE FACTORS

 

DEMERIT POINTS

 

 

--BANK CHARGES

YES/NO

YES

--LITIGATION

YES/NO

YES

--OTHER ADVERSE INFORMATION

YES/NO

NO

MERIT POINTS

 

 

--SOLE DISTRIBUTORSHIP

YES/NO

NO

--EXPORT ACTIVITIES

YES/NO

NO

--AFFILIATION

YES/NO

YES

--LISTED

YES/NO

YES

--OTHER MERIT FACTORS

YES/NO

YES

 

 

RATING EXPLANATIONS

 

Credit Rating

Explanation

Rating Comments

A++

Minimum Risk

Business dealings permissible with minimum risk of default

A+

Low Risk

Business dealings permissible with low risk of default

A

Acceptable Risk

Business dealings permissible with moderate risk of default

B

Medium Risk

Business dealings permissible on a regular monitoring basis

C

Medium High Risk

Business dealings permissible preferably on secured basis

D

High Risk

Business dealing not recommended or on secured terms only

NB

New Business

No recommendation can be done due to business in infancy stage

NT

No Trace

No recommendation can be done as the business is not traceable

 

NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.

 

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 are as follows:

 

·         Financial condition covering various ratios

·         Company background and operations size

·         Promoters / Management background

·         Payment record

·         Litigation against the subject

·         Industry scenario / competitor analysis

·         Supplier / Customer / Banker review (wherever available)

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.