INDIA
MRF
Automobile
Initiating Coverage
08 July 2013
Buy
Market leadership with strong fundamentals
Key Data
Target Price: Rs16,779
CMP: Rs12,270
Upside: 37%
Madras Rubber Factory (MRF) commands a dominant
position in the Indian tyre industry and has presence
across the entire value chain of the automobile sector,
diversifying its product range from two-wheelers to CVs
and tractors. In near-term, MRF’s major capex is behind,
as it has already incurred Rs21bn over SY10-SY12 to
expand its overall capacity to 45mn tyres p.a from
28.4mn tyres in SY09. Given its leadership position in
the industry driven by quality, brand recall and
presence across all key segments, we believe that MRF
is better placed to ride on demand recovery expected
over SY14E-SY15E led by the pick up in replacement
demand and higher OEM growth. We initiate coverage
on the stock with a Buy rating and target price of
Rs.16,779 (based on 7x SY15E EPS).
 Strong market position with diverse product offerings: MRF
Bloomberg Code
*as on 05 July 2013




Ajay Shethiya
ajay.shethiya@centrum.co.in
+91 22 4215 9855
Y/E Sept (Rsmn)
SY11
SY12
SY13E
SY14E
SY15E
Strong brand image and wide distribution network: MRF
commands a strong brand image driven by long track record of
operations and its well-established pan-India distribution network.
MRF has been ranked highest in customer satisfaction with OE tires
according to the J.D Power (CSI) study. It has strong presence in the
high margin replacement market (~76% to its overall domestic sales)
owing to the wide distribution network it has created over the years.
The company has a network of around 120 sales offices and 9,155
dealers (> 4,500 exclusive MRF dealers).
Capex schedule behind, annual capacity enhanced to 45mn tyres:
MRF incurred capex of Rs.21bn over SY10-SY12 to enhance its overall
annual capacity to 45mn tyres from 28.45mn tyres in SY09. The
incremental capacity was planned through both brownfield expansion
at Pudhucherry, Arakkonam, Goa, and two Greenfield projects at Medak
(AP) and Trichy (TN). Of the overall capex of Rs.21bn, Rs.7bn was funded
through NCD issue and the rest through internal accruals.
Strong operating cash flows to support organic growth: We
understand that while major capex is behind for now, the company will
have to keep adding capacities to meet demand. However, we expect
strong operating cash flows to support capex and debt levels to remain
low (0.3x in SY15E vs. 0.9x in SY12) after considering capex of Rs.17bn
over SY13E-SY15E. We are factoring in major capex of Rs.10bn in SY15E.
Lower rubber prices drive performance for 1HSY13: Despite flat
revenue growth for MRF in 1HSY13 YoY, it registered strong growth
in operating performance driven by softening in rubber prices.
EBITDA margin for 1HSY13E stood at 14.3% (one of the highest in
past quarters) and absolute EBITDA registered a YoY growth of 45%.
Rubber prices continue to remain soft and further corrected by 13%
YoY in 3QSY13. We believe this is likely to drive strong profitability for
the company in SY13E despite muted revenue growth.
MRF BO
Current Shares O/S (mn)
4.2
Diluted Shares O/S(mn)
4.2
Mkt Cap (Rsbn/USDmn)
52.2/869
52 Wk H / L (Rs)
15,500/9,521
5 Year H/L
15,500/1,445
Daily Vol. (3M NSE Avg.)
11,648
Face Value (Rs)
10
USD = Rs60.1
Shareholding Pattern
Promoter
27.2%
continues to be the market leader in domestic tyre industry with
significant presence across the value chain of automotive segments.
It is the largest player in the passenger car segment with a market
share of 21.3%. It is also the largest player in 2W and LCV segments
with a market share of 27% and 44% respectively. In the M&HCV
segment it commands overall market share of 20.4%.

MRF IN
Reuters Code
Others
57.7%
FII
4.3%
DII
10.7%
as on 31 March 2013
One Year Indexed Stock Performance
160
150
140
130
120
110
100
90
80
Jul-12
Sep-12
Nov-12
Jan-13
MRF LTD
Mar-13
May-13
Jul-13
NSE CNX NIFTY INDEX
Price Performance (%)*
1M
(18.9)
(1.8)
MRF
NIFTY
6M
(7.9)
(3.3)
1Yr
20.2
9.7
Source: Bloomberg, Centrum Research
*as on 04 July 2013
Valuations and Recommendation: At the CMP of Rs.12,270, the
stock is currently trading at 5.8x SY14E EPS of Rs.2,103 and 5.1x SY15E
EPS of Rs.2,397. We are initiating coverage on the stock with a Buy
rating and target price of Rs.16,779 (based on 7x SY15E EPS, , in line
with 5 yr historical average).
Rev
YoY (%)
97,432
118,702
123,277
142,903
165,737
30.5
21.8
3.9
15.9
16.0
EBITDA EBITDA (%)
Adj PAT
8.3
10.6
13.4
12.6
12.1
3,405
5,724
7,785
8,919
10,163
8,048
12,610
16,531
18,076
19,972
YoY (%) Fully DEPS
(3.8)
68.1
36.0
14.6
13.9
508
1,350
1,836
2,103
2,397
RoE (%)
RoCE (%)
P/E (x)
EV/EBITDA (x)
10.8
22.2
24.1
22.1
20.5
6.8
13.8
15.8
16.0
16.2
24.2
9.1
6.7
5.8
5.1
9.1
6.1
4.3
3.8
3.3
Source: Company, Centrum Research Estimates
Centrum Equity Research is available on Bloomberg, Thomson Reuters and FactSet
Company Background
Shareholding pattern (%)
Promoter
FII
DII
Others
Total
2QSY13
1QSY13
4QSY12
3QSY12
27.3
4.3
10.7
57.7
27.2
4.4
10.4
58.0
27.0
5.0
10.1
57.9
27.3
4.2
10.8
57.7
100.0
100.0
100.0
100.0
MRF, India’s largest manufacturer of automotive tyres and tubes, was
incorporated as a private limited company in 1960 to take over the
business of a partnership firm called ‘The Madras Rubber Factory’,
started by the late Mr. K.M. Mammen Mapillai. Over the years, the
company has established a country-wide dealer network and enjoys a
strong brand image.
Source: BSE
MRF ranks highest in CSI by J.D. Power
Trend in EBITDA margins
15.3
4,442
1,806
4Q SY11
13.3
3,505
1,536
3Q SY11
3,232
2,193
6.9
2Q SY11
1,000
6.0
2,424
2,000
9.0
1Q SY11
3,000
9.2
10.9 10.7 11.7
3,258
11.2
2,575
4,000
4,031
(Rs mn)
5,000
EBITDA
2Q SY13
1Q SY13
4Q SY12
3Q SY12
2Q SY12
1Q SY12
0
840
MRF
18.0
15.0
12.0
9.0
6.0
3.0
0.0
839
JK Tyre
836
Bridgestone
834
Industry Average
Apollo Tyres
Goodyear
824
823
EBITDA margin (RHS)
Source: Company, Centrum Research
Source: J.D. Power, Centrum Research, Rating on scale of 1000 points
Key management personnel
Name
Position
K.M.Mammen
Chairman & Managing Director
Arum Mammen
Managing Director
K.M.Philip
Whole-time Director
Rahul Mammen Mappillan
Whole-time Director
Ravi Mannath
Company Secretary
2
MRF
MRF
Investment Rationale

Lower rubber prices drive solid performance for 1HSY13: Despite flat revenue
growth in 1HSY13 YoY, the company registered strong growth in operating
performance largely driven by softening in rubber prices. EBITDA margins for
1HSY13E stood at 14.3% (one of the highest in last several quarters) and EBITDA
registered a YoY growth of 45%.
15.0%
165
250
210
202
176
191 193
181 173
200
160
142
10.0%
150
119
97 102
APTY
JKI
CEAT
MRF
Average
Q4FY13
Q3FY13
Q2FY13
1QFY13
Q4FY12
Q3FY12
Q2FY12
1QFY12
-5.0%
Q4FY11
50
Q3FY11
0.0%
Q2FY11
100
1QFY11
5.0%
4QFY10

225 228
194
3QFY10

20.0%
2QFY10

Margins profile better than peers
Strong market position with diverse product offerings: MRF continues to be the
market leader in domestic tyre industry with significant presence across the value
chain of automotive segments.
Strong brand image and wide distribution network: MRF commands a strong
brand image driven by long track record of operations and its well-established panIndia distribution network. MRF has a strong presence in the replacement market
(~76% to its overall domestic sales) owing to wide distribution network it has
created over the years.
Capex schedule behind, overall capacity enhanced to 45mn tyres p.a: MRF
incurred capex of Rs.21bn over SY10-SY12 to enhance overall annual capacity to 45mn
tyres from 28.45mn in SY09.
Radialization to drive profitability in the long term: Radialization in the truck
segment in India currently stands low at 21% vs. world average of 68% and is
expected to reach 35%+ over the next three years owing to OE thrust.
1QFY10

0
Avg rubber price (Rs/kg)
Source: Company, Capitalline,Centrum Research
Summary Financial
Y/E Sept (Rs mn)
Revenue
YoY Growth (%)
Operating Profit
YoY Growth (%)
Operating Margin (%)
Depreciation
Interest Expenses
Other Non Operating Income
Exceptional Items
PBT
Provision for Tax
Reported PAT
YoY Growth (%)
PAT Margin (%)
Adjusted PAT
YoY Growth (%)
PAT Margin (%)
Cash Flow Statement Data
Cash generated from operations
Cash flow from investing activities
Cash flow from financing activities
Net cash increase/decrease
Balance Sheet Data
Shareholder's fund
Debt
Deferred Tax
Total Capital Employed
Fixed Assets
Investments
Net Current Assets
Total Assets
Ratios (%)
ROCE
ROA
ROE
Per Share Ratios (Rs)
Fully Diluted EPS ( Adjusted)
Solvency Ratio (x)
Debt-Equity
Interest Coverage Ratio
Valuation Parameters (x)
P/E
P/BV
EV/EBITDA
EV/Sales
SY11
SY12
SY13E
SY14E
SY15E
97,432
30.5
8,048
(2.8)
8.3
2,476
930
253
4,042
8,937
2,742
6,194
75.0
6.4
3,405
(3.8)
3.5
118,702
21.8
12,610
56.7
10.6
3,011
1,588
320
8,331
2,608
5,724
(7.6)
4.8
5,724
68.1
4.8
123,277
3.9
16,531
31.1
13.4
3,724
1,708
400
11,500
3,714
7,785
36.0
6.3
7,785
36.0
6.3
142,903
15.9
18,076
9.3
12.6
4,062
1,533
500
12,982
4,063
8,919
14.6
6.2
8,919
14.6
6.2
165,737
16.0
19,972
10.5
12.1
4,482
1,323
625
14,793
4,630
10,163
13.9
6.1
10,163
13.9
6.1
2,607
(10,304)
7,805
108
5,932
(9,680)
3,798
51
11,230
(5,000)
(2,272)
3,958
9,055
(6,000)
(3,311)
(256)
11,724
(10,000)
(3,355)
(1,631)
22,978
21,473
1,418
45,869
30,136
727
15,006
45,869
28,578
25,395
1,867
55,840
33,285
4,247
18,309
55,840
36,092
23,395
2,487
61,973
32,561
6,247
23,166
61,973
44,699
20,395
3,187
68,281
32,499
8,247
27,535
68,281
54,508
17,395
3,985
75,887
38,018
8,247
29,622
75,887
6.8
4.2
10.8
13.8
8.4
22.2
15.8
10.3
24.1
16.0
10.9
22.1
16.2
11.2
20.5
508
1,350
1,836
2,103
2,397
0.9
6.0
0.9
6.0
0.6
7.5
0.5
9.1
0.3
11.7
24.2
2.3
9.1
0.7
9.1
1.8
6.1
0.6
6.7
1.4
4.3
0.6
5.8
1.2
3.8
0.5
5.1
1.0
3.3
0.4
Source: Company, Centrum Research Estimates
3
MRF
MRF
Investment Argument
Domestic tyre industry: In a nutshell
The overall size of the Indian tyre industry as on March 2013 stands at Rs.430bn, of which exports
contribute Rs.42bn and is dominated by 10 companies accounting for 93% of the total tyre
production. The industry is classified (based on revenue contribution) into commercial vehicle tyres
(71%) and passenger vehicle tyres (22%). Commercial vehicle tyres include those for medium and
heavy commercial vehicles (MHCV 54%), light commercial vehicles (LCV 9%) and tractors (8%).
Passenger vehicle tyres cover passenger cars and UVs/MPVs (14%) and Two-wheelers (13%).
The three major segments of the tyre industry are original equipment (OE, 26%), replacement (63%)
and exports (11%). The performance of the industry is influenced by the replacement segment due
to a larger share of truck tyres (73%) in the product mix. The industry is raw-material intensive, with
raw materials constituting about 70-72% % of sales turnover.
Exhibit 1: Snapshot: Domestic tyre industry
Turnover of Indian Tyre Industry
Rs. 430bn
Tyre Production (Tonnage)
1.5 mn M.T.
Tyre Export from India (Value) :
Rs. 42.1bn
Number of tyre companies:
39
Industry Concentration
10 Large tyre companies account for over 95% of total tyre production.
Passenger Car tyres: 98%
Radialisation Level - Current
Light Commercial Vehicles: 25%
(as a % of total tyre production)
M&HCV ( Truck & Bus ): 20%
Source: ATMA, Centrum Research
Exhibit 2: Trend in domestic tyre production: 5 year CAGR ( FY08-FY12) at 11.5%
Category
(in mn units)
Truck & Bus
Passenger Car
LCV’s
Tractor Front
Tractor Rear
Tractor Trailer
A.D.V.
Scooter
Motor Cycle
O.T.R.
Total
Category
(in mn units)
Two-wheelers
Passenger Cars
Truck/Bus
LCV’s
Farm
Others
Total
FY05
11.1
13.3
3.9
1.3
1.1
0.4
0.6
10.1
18.1
0.1
FY06
11.9
14.9
4.5
1.4
1.1
0.6
0.8
9.6
21.1
0.1
FY07
12.4
15.6
4.8
1.8
1.3
0.8
1.0
9.6
26.1
0.1
FY08
13.1
17.9
5.3
1.8
1.2
0.9
1.1
11.6
27.9
0.1
FY09
12.8
18.0
5.3
1.8
1.3
0.8
0.8
10.9
30.1
0.1
FY10
14.8
21.4
5.7
2.4
1.6
0.9
0.8
13.6
35.7
0.2
FY11
15.7
27.7
6.0
2.6
1.8
1.1
0.9
20.1
43.1
0.2
FY12
16.1
28.7
6.7
2.8
1.9
1.0
1.0
22.2
44.9
0.2
FY13
(April-Dec)
12.0
21.4
5.1
2.1
1.4
0.7
0.7
16.6
34.1
0.1
FY12
(April-Dec)
12.7
23.9
6.2
2.1
1.4
0.7
0.7
12.2
32.1
0.2
60.1
66.0
73.5
81.1
82.1
97.1
119.2
125.4
94.2
92.2
FY05
28.2
13.3
11.1
3.9
2.8
0.7
FY06
30.6
14.9
11.9
4.5
3.1
0.9
FY07
35.7
15.6
12.4
4.8
3.9
1.1
FY08
39.5
17.9
13.1
5.3
3.9
1.3
FY09
41.0
18.0
12.8
5.3
3.9
1.0
FY10
49.2
21.4
14.8
5.7
4.9
1.0
FY11
63.3
27.7
15.7
6.0
5.4
1.1
FY12
67.1
28.7
16.1
6.7
5.7
1.2
FY13
(April-Dec)
50.7
21.4
12.0
5.1
4.2
0.9
FY12
(April-Dec)
44.2
23.9
12.7
6.2
4.2
1.0
YoY
change
14.6
(10.5)
(6.0)
(18.4)
0.1
(10.9)
5 Years
FY08-FY12
14.1
12.6
5.2
5.9
9.6
60.1
66.0
73.5
81.1
82.1
97.1
119.2
125.4
94.2
92.2
2.1
11.5
Source: ATMA, Centrum Research
4
MRF
MRF
Exhibit 3: Indian tyre industry : Segmental volume and revenue contribution
% of overall volumes
% of Revenues
Others 0.9
Farm
Passenger Cars
Two-Wheeler
Passenger Cars
4.5
14.0
5.3
13.0
12.8
9.0
22.9
8.0
53.5
2.0 Others
Light Trucks
Truck/Bus
Truck/Bus
54.0
Two-Wheeler
Light Trucks
Farm
Source: ATMA, Centrum Research
Exhibit 4: Replacement demand the key driver
80
73
70
60
50
42
42
41
30
58
56
37
35
40
20
61
58
53
39
37
22
14 13
5
10
1
2
Tractor
Front
Tractor
Rear
7
3
0
Truck/Bus
Passenger
Car / Jeep
LCV
Replacement
OEMs
Scooter /
Moped
Motor
Cycle
Export
Source: ATMA, Revenue contribution to overall segmental sales, Centrum Research
Demand recovery over FY14E-FY15E
The industry has seen a muted revenue growth of 5% YoY in FY13E over FY12. Slackening pace of
economic activity and demand slowdown in the domestic auto industry has had an adverse impact
on the domestic tyre industry during FY13, with volumes across most auto Original Equipment (OE)
segments barring Light Commercial Vehicles (LCVs) declining/ staying flat and replacement demand
continuing to remain muted.
However, based on our demand projection across different segments, we expect overall tyre
demand to improve 12.1% in FY14E and 12.8% in FY15E. We forecast faster pick-up in replacement
demand across segments and higher OEM growth.
5
MRF
MRF
Exhibit 5: Demand recovery likely over FY14E to FY15E
Demand projection for M&HCV segment
Est. M&HCV population (units)
Avg. tyre per vehicle (units)
M&HCV tyre population in use (in '000s)
OEM sales (units)
Avg. tyre per vehicle (units)
Tyres demand from OEM (in '000s)
Replacement demand (in '000s) (1.5 yrs avg. life)
Annual M&HCV tyre demand (in '000s)
YoY Growth (%)
FY08
1,668,093
9.0
15,013
296,675
8.8
2,620
7,905
10,525
12.5
FY09
1,822,894
9.0
16,406
200,406
8.6
1,728
9,177
10,905
3.6
FY10
1,861,924
9.0
16,757
265,369
8.4
2,242
10,522
12,764
17.0
FY11
2,018,609
9.0
18,167
351,408
8.6
3,034
12,112
15,146
18.7
FY12
2,262,544
9.0
20,363
377,711
8.6
3,261
13,575
16,836
11.2
FY13E
2,505,499
9.0
22,549
287,282
8.6
2,480
15,033
17,513
4.0
FY14E
2,773,762
9.0
24,964
287,282
8.6
2,480
16,643
19,123
9.2
FY15E
2,960,065
9.0
26,641
316,010
8.6
2,728
17,760
20,489
7.1
Demand projection for PV segment
FY08
FY09
FY10
FY11
FY12
FY13E
FY14E
FY15E
Est. PV population (mn units)
Avg. tyre per vehicle
PV tyre population in use (mn)
OEM sales (mn units)
Avg. tyre per vehicle
Tyres demand from OEM (mn)
Replacement demand (mn) (5.4 yrs avg. life)
Annual PV tyre demand (mn)
YoY Growth (%)
8.3
5.0
41.5
1.8
5.0
8.8
8.2
17.1
12.2
9.3
5.0
46.7
1.9
5.0
9.4
8.0
17.4
2.0
10.4
5.0
52.0
2.4
5.0
12.0
9.7
21.6
24.2
11.6
5.0
58.1
2.9
5.0
14.7
10.7
25.4
17.5
13.4
5.0
67.1
3.1
5.0
15.7
12.4
28.1
10.4
15.4
5.0
76.9
3.2
5.0
16.2
14.2
30.4
8.2
18.8
5.0
93.9
3.4
5.0
17.0
17.3
34.3
13.0
22.6
5.0
113.0
3.8
5.0
19.1
20.8
39.9
16.2
Demand projection for 2W segment
FY08
FY09
FY10
FY11
FY12
FY13E
FY14E
FY15E
Est. Two-wheeler population (mn units)
Avg. tyre per vehicle
Two-wheeler tyre population in use (mn)
OEM sales (units in mn)
Avg. tyre per vehicle
Tyres demand from OEM (mn)
Replacement demand (mn) (5 yrs avg. life)
Annual two-wheeler tyre demand (mn)
YoY Growth (%)
49.0
2.0
98.1
8.1
2.0
16.1
19.6
35.8
10.5
53.4
2.0
106.8
8.4
2.0
16.9
21.4
38.2
6.9
57.5
2.0
115.0
10.5
2.0
21.0
23.0
44.0
15.2
71.3
2.0
142.6
13.3
2.0
26.6
28.5
55.1
25.2
80.5
2.0
161.1
15.4
2.0
30.8
32.2
63.0
14.2
89.5
2.0
179.0
15.8
2.0
31.5
35.8
67.3
6.9
106.5
2.0
213.1
17.0
2.0
34.0
42.6
76.7
13.9
125.3
2.0
250.5
18.7
2.0
37.4
50.1
87.5
14.2
Overall demand projection ( in mn units)
FY08
FY09
FY10
FY11
FY12
FY13E
FY14E
FY15E
19.5
17.1
35.8
72.4
10.5
19.9
17.4
38.2
75.6
4.4
23.3
21.6
44.0
88.9
17.7
26.1
25.4
55.1
106.7
20.0
28.3
28.1
63.0
119.4
11.9
29.5
30.4
67.3
127.2
6.6
31.6
34.3
76.7
142.6
12.1
33.5
39.9
87.5
160.9
12.8
Domestic M&HCV tyre demand
Domestic PV tyre demand
Domestic two-wheeler tyre demand
Total domestic tyre demand
YoY Growth (%)
Source: SIAM, Centrum Research
Radialization to drive profitability in the long term
Radialization in the truck segment in India currently stands low at 21% against world average of 68%
and is expected to reach 35%+ over the next three years owing to OE thrust. Radial tyres are priced
20-25% higher than cross-ply tyres. Most tyre companies are expanding radial tyre capacities.
Capital expenditure incurred on this expansion is expected to reduce profitability in the short term
as manufacturing of radial tyres is more capital intensive than cross-ply tyres and also due to
significant capacity addition. However, in the long run, we expect radicalization to improve overall
profitability for the industry. The Trichy plant of MRF has a capacity of 9 lakh tyres p.a for TBR.
6
MRF
MRF
Exhibit 6: Trend in radialization in India (Figures in %)
Passenger Cars
Light Commercial Vehicles
FY13E
98
FY12
98
FY11
98
FY10
97
FY09
97
25
17
16
12
15
10
12
95
12
FY07
95
12
90
FY05
20
22
FY08
FY06
Trucks and Buses
85
6
4
3
11
2
11
2
Source: ATMA, Centrum Research
Exhibit 7: Radialisation in M&HCV likely to further accelerate
World
68%
Africa/Middle East
72%
India
21%
Asia
Expected to reach 35%+ in
the next 3
years owing to infrastructure
development and OE thrust
52%
South America
65%
North America
96%
27%
Eastern Europe
Central Europe
95%
Western Europe
100%
0%
20%
40%
60%
80%
100%
120%
Source: Apollo Tyres investor presentation, Centrum Research
7
MRF
MRF
MRF: Better placed to capitalize on this opportunity
Market leader with diverse product offerings
MRF continues to be the market leader in domestic tyre industry with significant presence across the
value chain of automotive segments. It is the largest player in the passenger car segment with a
market share of 21.3%. It is also the largest player in 2W and LCV segment with a market share of
44% and 27% respectively. In the M&HCV segment, it commands overall market share of 20.4%.
MRF has continued to maintain the market leadership position in the Indian tyre industry for many
years despite competition. Diverse product offerings with a presence in all segments coupled with
strong focus on replacement market enabled the company to sustain the strong market position.
Exhibit 8: Sizeable market share in each segments with dominance in PV’s and LCV’s
Bridgestone
Truck (Total)
0.9
Ceat
11.6
Birla
13.6
MRF
Apollo
26.7
10
20
Ceat
Pass.Radial
18.2
30.4
JKTIL
33.1
0
Birla
10
20
30
40
LCV
2.7
8.4
16.2
24.0
Apollo
19.6
Apollo
0
10
20
30
Tr.Rear
3.1
0
Goodyear
MRF
33.4
MRF
Goodyear
33.5
Ceat
30
40
60
7.6
13.2
JKTIL
15.4
20
40
OTR
Birla
8.0
10
20
1.6
Apollo
6.5
Apollo
44.4
MRF
21.3
MRF
0
10.6
JKTIL
11.7
Bridgestone
Ceat
6.5
Ceat
10.6
Goodyear
JKTIL
Birla
4.8
JKTIL
Birla
6.2
30
0.2
Birla
Ceat
Apollo
21.5
0
Truck Radials
4.0
MRF
20.4
JKTIL
Bridgestone
20.8
26.0
27.4
0
10
20
30
Source: Industry, Market share based on domestic units sold, Centrum Research
8
MRF
MRF
Strong brand image and wide distribution network
With a long track record of operations and well-established pan-India distribution network, the
company has strong brand image. As on March 31, 2012, the company had a network 120 sales
offices and 9,155 dealers, a strong presence in the replacement market which is critical to its overall
profitability. Of the above dealer network of 9,155, more than 4,500 deal exclusively in MRF’s
products. The share of the replacement market stands at about 76% of MRF’s domestic revenues.
With such high share of revenue from the replacement market, risks due to the cyclical nature of the
industry are relatively limited.
MRF ranks highest in customer satisfaction with original equipment tires among five tire
manufacturers, according to the J.D Power and Associates India Original Equipment Tire Customer
Satisfaction Index (CSI) study. With an overall CSI score of 840 on a 1,000-point scale, MRF ranks
highest and performs particularly well in all factors driving overall satisfaction.
Exhibit 9: MRF ranks highest in CSI by J.D. Power
Year
MRF
JK Tyre
Bridgestone
Industry Average
Apollo Tyres
Goodyear
2001
2005
2008
2009
2010
2011
2012
2013
745
763
836
804
810
833
841
840
718
781
798
811
795
820
831
839
751
770
795
797
796
814
810
836
738
771
808
798
798
822
827
834
816
784
804
830
827
824
720
769
783
767
768
802
820
823
Source: J.D. Power, Score on scale of 1000 points, Centrum Research
Capacity expands to 45mn tyres p.a from 28.4mn in SY09
MRF incurred capex of Rs.21bn over SY10 to SY12 to enhance its overall annual capacity to 45mn
tyres from 28.45mn in SY09. The incremental capacity has been planned through both brown field
expansion at Pudhucherry, Arakkonam, Goa, and two Greenfield projects at Medak (AP) and Trichy
(TN). Of the overall capex of Rs.21bn, Rs.7bn was funded through NCD issue and the rest through
internal accruals. The company commissioned the green field project in Trichy on January 26, 2012.
Moreover, capacity expansion in most existing plants at Pudhucherry, Arakkonam, Goa, and the
green field project at Medak were completed in SY12. With the completion of the capex, the overall
annual capacity available in SY13E will be 45mn tyres.
Benign rubber prices offer margin respite to industry, MRF
The industry is raw-material intensive, with raw materials constituting about 70-72% % of sales
turnover. Natural Rubber (NR) constitutes ~50% of the sales turnover, while other petro-based
products such as styrene butadiene rubber, poly butadiene rubber, nylon tyre fabric cord, carbon
black and rubber chemicals make up the balance. Hence, industry margins are highly correlated to
price movement in rubber and crude oil. Despite weak demand environment, the saving grace for
tyre companies in recent past was the significant correction in rubber prices that helped all
companies improve profitability. Falling global prices due to weak global auto demand coupled
with sharp moderation in domestic automobile production led to the decline.
According to an International Rubber Study Group (IRSG) report, the world Natural Rubber
production and consumption in 2014 would be 12.45mn and 12.30 mn tonnes with a surplus of
150,000 tonnes. As far as the domestic market is concerned, the production and consumption of NR
in 2013-14 are projected at 960,000 tonne and 1020,000 tonne respectively with a deficit of 60,000
tonnes. However, there will not be any shortage of NR in the domestic market in FY14E, as the
estimated opening stock in April 2013 was 266,000 tonnes and the rubber consuming industry has
entitlement to import more than 100,000 tonnes of NR through duty free channels. Considering the
overall bearish trend in the global market and demand-supply scenario, prices are expected to
remain soft in the medium-term.
While rubber prices have recently seen an uptick and moved by 5% QoQ in 3QSY13 at Rs.168/kg,
it remained lower by 13% on YoY basis. Rubber price has seen further uptick from 3QSY13 levels.
However, historic trend over the last 11-12 years indicates that this is on account of seasonality
factor and price will start correcting from July end onwards. Also, compared to earlier years, the
closing stock seems sufficient.
9
MRF
MRF
Exhibit 10: Rubber prices continue to remain benign
(Rs/Kg)
250
240
Jun-13
Apr-13
Jan-13
Mar-13
Nov-12
Oct-12
Jul-12
Aug-12
May-12
Feb-12
Mar-12
Dec-11
Nov-11
Jul-11
Sep-11
Jun-11
Apr-11
Jan-11
Mar-11
Nov-10
Oct-10
Jul-10
Aug-10
230
220
210
200
190
180
170
160
150
Source: Rubber board of India, Centrum Research
Exhibit 11: Recent uptick in rubber prices – A seasonal impact, likely to trend lower
350,000
300
300,000
250
250,000
200
200,000
150
150,000
100
100,000
50
50,000
Closing stock (in tonnes)
May-13
Sep-12
Jan-12
May-11
Sep-10
Jan-10
May-09
Sep-08
Jan-08
May-07
Sep-06
Jan-06
May-05
Sep-04
Jan-04
May-03
Sep-02
0
Jan-02
0
Price (Rs/kg)
Source: Rubber board of India, IAS, Centrum Research
MRF has consistently been able to maintain better than industry EBITDA margins. Strong brand, significant
presence in the replacement market and better product mix has helped MRF to outperform industry profitability.
Exhibit 12: Strong margin profile vs. peers
20.0%
225 228
250
210
194
15.0%
165
202
176
191 193
181 173
200
160
142
10.0%
150
119
97 102
APTY
JKI
CEAT
MRF
Average
Q4FY13
Q3FY13
Q2FY13
1QFY13
Q4FY12
Q3FY12
Q2FY12
1QFY12
Q4FY11
Q3FY11
Q2FY11
1QFY11
-5.0%
4QFY10
50
3QFY10
0.0%
2QFY10
100
1QFY10
5.0%
0
Avg rubber price (Rs/kg)
Source: CMIE, Centrum Research
10
MRF
MRF
Financials
Revenue Outlook: Near term growth challenging; recovery expected
We expect MRF to register revenue CAGR of 16% over SY13-SY15E. Though, we expect SY13E
revenue growth to remain muted, it should recover over SY14-SY15E. Strong brand, presence across
value chain, widespread network and dominance across the segment will continue to help MRF in
registering better than industry growth.
Exhibit 13: Revenue trend ( YoY)
Exhibit 14: Revenue trend ( QoQ)
(Rs mn)
175,000
28,755
29,928
30,083
29,936
30,258
2QSY12
3QSY12
4QSY12
1QSY13
26,198
4QSY11
1QSY12
25,731
3QSY11
23,838
21,665
118,702
74,637
25,000
20,000
15,000
10,000
Source: Company, Centrum Research Estimates
2QSY13
2QSY11
1QSY11
SY15E
SY14E
SY13E
SY12
SY11
5,000
0
SY10
56,728
SY09
0
50,470
25,000
SY08
50,000
97,432
100,000
75,000
123,277
125,000
35,000
30,000
165,737
142,903
150,000
29,063
(Rs mn)
Source: Company, Centrum Research Estimates
Margin Outlook: EBITDA margins and earnings growth to remain strong in medium-term
Despite a flat YoY revenue growth for MRF in 1HSY13, the company registered strong growth in
operating performance largely driven by softening of rubber prices. EBITDA margins for 1HSY13E
stood at 14.3% (one of the highest in the past quarters) and EBITDA registered a YoY growth of 45%.
Rubber prices continue to remain soft and further corrected by 13% YoY in 3QSY13. We believe this
is likely to drive strong profitability for the company in SY13E despite muted revenue growth.
We expect MRF’s EBITDA margin to expand by 280bp in SY13E to 13.4% on the back of fall in rubber
prices which constitute a major chunk of the raw material cost and strong operating performance in
1HSY13. Going forward in SY14E and SY15E, we expect rubber prices to increase from current levels
and expect margins to stabilize in the range of 12-12.6%.
Exhibit 16: EBITDA margin trend (QoQ)
EBITDA
Source: Company, Centrum Research Estimates
11
13.3
15.0
4,442
4,031
3,505
3,232
3,258
18.0
12.0
9.0
6.0
3.0
EBITDA
2QSY13
1QSY13
0.0
4QSY12
0
3QSY12
SY15E
SY12
SY11
EBITDA margin (RHS)
1,000
11.7
6.9
2QSY12
3.0
2,000
10.7
9.0
6.0
2,575
6.0
9.2
1QSY12
3,000
10.9
1,806
9.0
11.2
4QSY11
4,000
1,536
12.0
3QSY11
15.0
(%)
15.3
2,193
19,972
(Rs mn)
5,000
2QSY11
8,048
8,275
12.1
(%)
0.0
SY10
6,914
SY09
0
4,109
5,000
SY08
10,000
16,531
8.3
8.1
SY13E
15,000
12.6
10.6
18,076
20,000
11.1
SY14E
12.2
12,610
25,000
13.4
1QSY11
(Rs mn)
2,424
Exhibit 15: EBITDA margin trend (YoY)
EBITDA margin (RHS)
Source: Company, Centrum Research Estimates
MRF
MRF
Exhibit 17: Earnings trend ( YoY)
Exhibit 18: Earnings trend (QoQ)
NPM (RHS)
Adjusted PAT
Source: Company, Centrum Research Estimates
2,106
1,802
1QSY13
8.0
7.0
6.0
5.0
4.0
3.0
2.0
1.0
0.0
2QSY13
1,647
4QSY12
1,447
3QSY12
0.0
1,501
1.0
2QSY12
10,163
SY15E
2.0
1,129
8,919
5,724
SY12
SY14E
3,405
SY11
7,785
3,540
SY10
Adjusted PAT
SY13E
2,530
SY09
0
1,446
2,000
SY08
4,000
6.0
2.3
1.2
1QSY12
3.0
4.8
5.5
3.9
3.8
614
4.0
2.9
5.0
4.7
4QSY11
5.0
3.5
(%)
7.2
319
6,000
2,400
2,100
1,800
1,500
1,200
900
600
300
0
3QSY11
8,000
(Rs mn)
7.0
6.0
4.8
4.7
(%)
899
4.5
6.1
2QSY11
10,000
6.2
1,022
6.3
12,000
1QSY11
(Rs mn)
NPM (RHS)
Source: Company, Centrum Research Estimates
MRF has incurred capex of Rs.21bn over SY10 to SY12 to enhance its overall annual capacity to
45mn tyres from 28.45mn tyres in SY09. We believe the company will have to keep adding
capacities to capture growth. Going forward, we expect strong operating cash flows to support
capex and debt levels to remain low. Overall, we are factoring in capex of Rs.17bn to be incurred
over SY13-SY15E.
Exhibit 19: Capex trend
Exhibit 20: Capacity expansion
(Rs mn)
(In units mn)
50
14,000
11,870
45
12,000
45
43
10,000
8,000
40
6,081
6,000
34
35
32
3,148
4,000
28
30
2,000
25
0
SY10
SY11
SY12
SY09
Source: Company, Centrum Research Estimates
SY10
SY11
SY12
SY13E
Source: Company, Centrum Research Estimates
Exhibit 21: Cash flow from operations to remain strong and support organic growth
(Rs mn)
14,000
11,724
11,230
12,000
9,055
10,000
8,000
5,932
6,000
4,000
2,000
2,607
1,205
0
SY10
SY11
SY12
SY13E
SY14E
SY15E
Source: CMIE, Centrum Research
12
MRF
MRF
Valuation and recommendation
At the CMP of Rs.12,270, the stock is currently trading at 5.8x SY14E EPS of Rs.2,103 and 5.1x SY15E
EPS of Rs.2,397. We are initiating coverage on the stock with a Buy rating and target price of
Rs.16,779 (based on 7x SY15E EPS, in line with 5 yr historical average).
Exhibit 22: Sensitivity Analysis
Sensitivity to key variables
% increase
% impact on EBITDA
% impact on EPS
Realization
1
+70 bps
+8.0
Rubber Price
1
-40 bps
-4.0
Source: Company, Centrum Research Estimates
Exhibit 23: 1 year forward EV/EBITDA chart
Exhibit 24: 1 year forward P/E chart
25
12.0
10.0
8.0
6.0
4.0
2.0
0.0
20
15
10
5
EV/EBITDA
Mean + Std Dev
P/E
Mean
Mean - Std Dev
Mean + Std Dev
Mean - Std Dev
Source: Bloomberg, Company, Centrum Research Estimates
Jun-13
Feb-13
Jun-12
Mean
Oct-12
Feb-12
Jun-11
Oct-11
Feb-11
Jun-10
Oct-10
Feb-10
Jun-09
Oct-09
Feb-09
Jun-08
Oct-08
Feb-08
Oct-07
Apr-06
Aug-06
Dec-06
Apr-07
Aug-07
Dec-07
Apr-08
Aug-08
Dec-08
Apr-09
Aug-09
Dec-09
Apr-10
Aug-10
Dec-10
Apr-11
Aug-11
Dec-11
Apr-12
Aug-12
Dec-12
Apr-13
0
Source: Bloomberg, Company, Centrum Research Estimates
Exhibit 25: Peer comparison
Mkt Cap
(Rs mn)
Domestic companies
MRF
Ceat Ltd
JK Tyre & Industries
Apollo Tyres
Balkrishna Industries
52,025
3,654
4,307
30,846
21,970
CAGR (FY13-FY15E)
EV/EBITDA
RoE
PAT
FY13E
FY14E
FY15E
FY13E
FY14E
FY15E
FY13E
FY14E
FY15E
FY13E
FY14E
FY15E
15.9
10.5
14.6
8.7
16.5
14.3
28.0
10.1
13.1
10.6
13.4
8.8
8.9
11.4
19.8
12.6
8.9
7.9
11.6
19.5
12.1
8.7
8.2
11.6
19.5
6.7
3.4
2.1
5.0
6.3
5.8
2.5
2.4
4.5
5.8
5.1
2.1
2.0
3.9
5.1
4.3
2.5
4.5
4.2
6.7
3.8
2.6
3.2
5.4
3.3
2.3
2.7
4.6
24.1
15.2
24.5
19.7
27.4
22.1
17.3
21.9
18.1
22.6
20.5
17.8
23.3
17.2
21.1
9.9
10.2
10.0
9.7
15.6
CAGR (CY12E/FY13CY14E/FY15E)
Mkt Cap
($ mn)
Global Companies
Bridgestone Corp
29,870
Continental AG
28,047
Goodyear Tire
3,779
Gajah Tunggal
1,104
Nexen Tire Corp
1,400
Pirelli & C. SpA
5,648
Sumitomo Rubber Industries
4,555
Cie Generale des Etablissements 17,436
Cooper Tire & Rubber Co
2,114
PE
EBITDA Margin (%)
Rev EBITDA
Rev EBITDA
10.8
18.8
4.9
5.5
0.0
10.4
10.9
10.0
10.6
14.3
5.3
8.4
6.5
8.5
1.7
5.6
0.2
2.4
PAT
26.8
12.8
80.4
11.6
11.1
12.6
18.0
3.3
2.2
PE
EV/EBITDA
RoE
EBITDA Margin (%)
CY12 CY13E CY14E
CY12 CY13E CY14E
CY12 CY13E CY14E/
CY12/ CY13E CY14E
FY13E /FY14E /FY15E /FY13E /FY14E /FY15E /FY13E /FY14E /FY15E /FY13E /FY14E FY15E
14.6
16.2
16.8
16.7
11.2
10.2
4.6
5.7
5.1
13.7
16.5
15.9
15.1
14.9
15.2
11.6
10.9
9.2
5.0
5.4
4.8
23.7
22.5
22.7
8.6
9.8
10.4
20.5
7.2
6.1
4.2
4.5
4.0
58.0
44.6
16.8
15.9
16.6
9.7
8.7
7.8
5.1
6.3
5.4
22.7
18.8
17.3
15.2
16.3
16.2
12.6
11.4
10.0
9.3
8.1
7.1
21.5
19.4
18.5
17.5
18.0
18.5
11.2
10.7
9.1
5.5
5.1
4.5
17.6
16.2
17.1
14.9
15.2
15.5
12.8
9.7
9.1
5.1
5.9
5.5
16.0
17.0
16.2
16.0
16.6
17.2
8.4
9.0
8.1
4.2
4.1
3.7
18.9
16.5
16.5
12.5
13.2
13.1
9.5
9.6
9.3
3.4
4.6
3.6
33.0
24.1
20.1
Source: Bloomberg, Centrum Research, MRF is SepY/E
13
MRF
MRF
Exhibit 26: Quarterly Financials
Particulars (Rs mn)
Net Sales
Raw Materials
Employee Costs
Other Expenditure
EBITDA
Depreciation
Interest
Other Income
Exceptional items before tax
PBT
Tax
Tax rate
Reported PAT
Adjusted PAT
YoY Growth (%)
Revenue
EBITDA
PAT
1QSY11
2QSY11
3QSY11
4QSY11
1QSY12
2QSY12
3QSY12
4QSY12
1QSY13
2QSY13
21,665
15,093
1,001
3,148
2,424
758
209
48
1,505
483
32
1,022
1,022
23,838
17,230
1,076
3,339
2,193
871
216
156
1,262
364
29
899
899
25,731
19,534
1,189
3,472
1,536
964
244
111
440
121
28
319
319
26,198
19,214
1,202
3,976
1,806
683
262
27
4,841
5,729
1,775
31
3,955
614
28,755
21,096
1,180
3,904
2,575
647
318
39
1,649
520
32
1,129
1,129
29,928
21,092
1,263
4,315
3,258
720
385
53
2,205
704
32
1,501
1,501
30,083
20,816
1,366
4,669
3,232
777
393
36
2,099
652
31
1,447
1,447
29,936
20,525
1,327
4,579
3,505
867
451
192
2,379
732
31
1,647
1,647
30,258
20,237
1,344
4,646
4,031
892
499
29
2,670
868
32
1,802
1,802
29,063
18,811
1,360
4,451
4,442
936
496
54
3,064
958
31
2,106
2,106
30.8
(2.6)
34.4
4.8
33.6
(6.2)
24.3
(12.2)
32.7
6.2
25.5
48.6
16.9
110.4
14.3
94.1
5.2
56.5
(2.9)
36.3
(14.4)
(6.2)
(48.3)
(20.5)
10.5
67.1
354.3
168.2
59.6
40.3
Source: Company, Centrum Research
Risk factors
Volatile rubber prices
Natural rubber is the major raw material used in the manufacture of tyres and accounts for 60-65%
of overall raw material cost. Increased volatility in rubber prices will have direct impact on the
company’s EBITDA margin and consequently its profit. Though, the company is normally able to
pass on commodity price increases with a lag, any significant increase in such costs would have an
impact on near-term earnings.
Slower than anticipated recovery in the Indian markets
We are expecting a recovery in Indian truck and car markets in SY14E and SY15E. If the recovery is
delayed or is weaker than expected, it will impact our revenue and earnings forecasts.
Increased price competition from global players in India
Global tyre makers such as Michelin and Bridgestone now have production capacities in India. If
these companies resort to a price war to capture market share, it could have a negative impact on
our revenue and earnings forecast.
14
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Financials
Exhibit 27: Income Statement
Y/E Sept (Rsmn)
Net Sales
% Growth
Raw Materials
Personnel
Manufact. & Other Exp.
EBITDA
EBITDA Margin (%)
Depn. & Amortn
EBIT
Interest Expenses
EBT
Other Income
Extraord. (Income)/Exp.
PBT
Tax-Total
Tax Rate (%) - Total
Reported PAT
Adjusted PAT
PAT Margin
% Growth
Exhibit 29: Balance Sheet
SY11
SY12
SY13E
SY14E
SY15E
97,432
30.5
71,071
4,468
13,846
8,048
8.3
2,476
5,571
930.2
4,641
253
4,042
8,937
2,742
30.7
6,194
3,405
3.5
(3.8)
118,702
21.8
83,529
5,137
17,426
12,610
10.6
3,011
9,599
1,587.8
8,011
320
8,331
2,608
31.3
5,724
5,724
4.8
68.1
123,277
3.9
82,634
5,907
18,204
16,531
13.4
3,724
12,807
1,707.6
11,100
400
11,500
3,714
32.3
7,785
7,785
6.3
36.0
142,903
15.9
97,056
6,794
20,977
18,076
12.6
4,062
14,015
1,532.6
12,482
500
12,982
4,063
31.3
8,919
8,919
6.2
14.6
165,737
16.0
114,081
7,813
23,871
19,972
12.1
4,482
15,491
1,322.6
14,168
625
14,793
4,630
31.3
10,163
10,163
6.1
13.9
SY11
SY12
SY13E
SY14E
SY15E
30.5
(2.8)
(3.8)
21.8
56.7
68.1
3.9
31.1
36.0
15.9
9.3
14.6
16.0
10.5
13.9
8.3
5.7
2.2
10.6
8.1
4.8
13.4
10.4
6.3
12.7
9.8
6.2
12.1
9.4
6.1
10.8
6.8
22.2
13.8
24.1
15.8
22.1
16.0
20.5
16.2
52.4
44.9
49.6
46.0
40.7
49.5
45.0
41.0
50.1
45.0
41.0
54.0
45.0
41.0
54.0
0.93
0.91
1.0
6.0
0.89
0.87
0.8
6.0
0.65
0.52
0.6
7.5
0.46
0.36
0.5
9.1
0.32
0.27
0.6
11.7
25.0
1.7
0.20
25.0
1.9
0.20
55.1
3.0
0.45
63.1
3.0
0.51
71.9
3.0
0.59
803
508
803
5,419
1,350
1,350
1,350
6,740
1,836
1,836
1,836
8,512
2,103
2,103
2,103
10,542
2,397
2,397
2,397
12,856
24.2
2.3
9.1
0.7
9.1
1.8
6.1
0.6
6.7
1.4
4.3
0.6
5.8
1.2
3.8
0.5
5.1
1.0
3.3
0.4
Source: Company, Centrum Research Estimates
Exhibit 28: Key Ratios
Y/E Sept
Growth Metrics (%)
Net sales
EBITDA
Adjusted PAT
Profitability Metrics (%)
EBITDA Margin
EBIT Margin
PAT Margin
Return Ratio (%)
ROE
ROcE
Turnover Ratio days
Inventory Period
Debtors Period
Net working capital
Solvency Ratio
Debt-equity (x)
Net Debt-equity (x)
Liquidity ratio (x)
Interest coverage ratio (%)
Dividend
Dividend per share
Dividend Payout (%)
Dividend Yeild (%)
Per share (Rs)
Basic EPS
Fully diluted EPS – Adjusted
Fully diluted EPS – Reported
Book value
Valuation
P/E
P/BV
EV/EBITDA
EV/Sales
Y/E Sept (Rsmn)
Sources of Funds
Capital
Reserves & Surplus
Shareholders’ Funds
Total Loan Funds
Deferred Tax Liabi. - Net
Total
Application of Funds
Gross Block
Accumulated Dep.
Capital WIP
Net Fixed Assets
Investments
Inventories
Sundry Debtors
Cash & Bank Balances
Loans and Advances
Tot. Curr. Assets, Loans & Adv.
Current Liab.
Provisions
Total Current Liab. & Prov.
Net Current Assets
Total assets
SY11
SY12
SY13E
SY14E
SY15E
42
22,935
22,978
21,473
1,418
45,869
42
28,536
28,578
25,395
1,867
55,840
42
36,049
36,092
23,395
2,487
61,973
42
44,657
44,699
20,395
3,187
68,281
42
54,465
54,508
17,395
3,985
75,887
38,318
(18,604)
10,423
30,136
727
15,260
13,089
560
3,587
32,496
15,426
2,064
17,490
15,006
45,869
50,625
(21,487)
4,147
33,285
4,247
16,456
14,541
611
2,984
34,592
13,938
2,345
16,283
18,309
55,840
55,772
(25,211)
2,000
32,561
6,247
16,701
15,216
4,568
3,096
39,582
13,707
2,709
16,416
23,166
61,973
60,272
(29,272)
1,500
32,499
8,247
19,359
17,638
4,312
3,589
44,899
14,224
3,140
17,364
27,535
68,281
67,772
(33,754)
4,000
38,018
8,247
22,452
20,456
2,681
4,163
49,752
16,488
3,642
20,130
29,622
75,887
SY11
SY12
SY13E
SY14E
SY15E
4,894
(1,174)
2,476
(4,974)
(4,153)
(2,314)
353
7,500
(3,589)
2,607
(10,304)
(10,304)
7,929
(123)
7,805
108
8,331
(2,158)
3,011
(1,452)
(1,196)
603
281
(1,489)
(3,252)
5,932
(6,159)
(3,520)
(9,680)
3,922
(123)
3,798
51
11,500
(3,094)
3,724
(675)
(245)
(113)
364
(231)
(900)
11,230
(3,000)
(2,000)
(5,000)
(2,000)
(272)
(2,272)
3,958
12,982
(3,363)
4,062
(2,422)
(2,658)
(493)
431
517
(4,625)
9,055
(4,000)
(2,000)
(6,000)
(3,000)
(311)
(3,311)
(256)
14,793
(3,833)
4,482
(2,818)
(3,093)
(573)
502
2,264
(3,718)
11,724
(10,000)
(10,000)
(3,000)
(355)
(3,355)
(1,631)
Source: Company, Centrum Research Estimates
Exhibit 30: Cash Flow
Y/E Sept (Rsmn)
Pre-tax profit
Total tax paid
Depreciation
Chg in debtors
Chg in inventory
Chg in loans & advances
Chg in provisions
Chg in other current liabilities
Net chg in working capital
CF from op. activities (a)
Capital expenditure
Chg in Trade investments
CF from invest. activities (b)
Debt raised/(repaid)
Dividend (incl. tax)
CF from fin. activities (c)
Net chg in cash (a+b+c)
Source: Company, Centrum Research Estimates
Source: Company, Centrum Research Estimates
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Appendix A
Disclaimer
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Member (NSE, BSE, MCX-SX), Depository Participant (CDSL) and SEBI registered Portfolio Manager
Registration Nos.
CAPITAL MARKET SEBI REGN. NO.: BSE: INB011454239, NSE: INB231454233
DERIVATIVES SEBI REGN. NO.: NSE: INF231454233 (TRADING & SELF CLEARING MEMBER)
CDSL DP ID: 12200. SEBI REGISTRATION NO.: IN-DP-CDSL-661-2012
PMS REGISTRATION NO.: INP000004383
MCX – SX (Currency Derivative segment) REGN. NO.: INE261454230
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Mr. Ashok Devarajan; Tel: (022) 4215 9000; Email ID: compliance@centrum.co.in
Centrum Broking Limited
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Fort, Mumbai - 400 001
Santacruz (E), Mumbai 400 098.
17
Tel: (022) 4215 9000
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