?? report 42 ... maruti suzuki, tata motors, honda, hyundai, ashok leyland, mahindra ... ltd. (cil)...

Download ?? Report 42 ... Maruti Suzuki, Tata Motors, Honda, Hyundai, Ashok Leyland, Mahindra ... Ltd. (CIL) 2015-16. tyre. DIRECTORS’ REPORT

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  • Contents

    Board of Directors 4

    Financial Analysis 14

    Chairman & Managing Directors Overview 18

    Directors Report 42

    Management Discussion & Analysis 63

    Corporate Governance Report 69

    Corporate Social Responsibility 78

    Sustainability Report 80

    Financial Statements:

    - Standalone Accounts 88

    - Consolidated Accounts 119

  • At JK Tyre, our objective has been to build an enduring company.

    Enduring across market cycles, diverse geographies, product segments and operating benchmarks.

    Seldom was this enduring commitment more visibly showcased than in our 2015-16 performance.

    The company encountered extensive challenges.

    And yet reported the highest profits in its existence.

  • In 2015-16, the external environment transformed with unpredictable speed.

    JK Tyre transformed even faster.

    2 | JK Tyre

  • JK Tyre. Our commitment to

    endure is derived from positive, productive

    and perpetual transformation

    Competition from global and domestic brands increased.

    JK Tyre accelerated cost rationalization to enhance competitiveness.

    Energy costs and water accessibility became challenging.

    JK Tyre moderated its carbon footprint.

    The consumer became increasingly demanding.

    JK Tyre virtually doubled new product launches.

    Product dumping from China increased in India.

    JK Tyre increased its tyre manufacturing capacity across select categories.

    External changes across markets and segments

    Internal transformation at JK Tyre

    Annual Report 2015-16 | 3

  • 8

    1 3 4

    10

    5

    11

    6 7

    9

    2

    Board of Directors

    KALPATARU TRIPATHYDirector

    8 9

    ARUN K. BAJ0RIADirector & President International Operations

    1 2 3

    SHREEKANT SOMANYDirector

    VIMAL BHANDARIDirector

    BHARAT HARI SINGHANIAManaging Director

    ADMINISTRATIVE OFFICE3, Bahadur Shah Zafar Marg,New Delhi 110 002

    REGISTERED OFFICEJaykaygram,PO Tyre Factory,Kankroli 313 342(Rajasthan)

    AUDITORSLodha & Co.Chartered Accountants

    4 | JK Tyre

  • 10 11

    BAKUL JAINDirector

    ANSHUMAN SINGHANIAWhole-time Director

    4 5 6 7

    SUNANDA SINGHANIADirector

    ARVIND SINGH MEWARDirector

    DR. RAGHUPATI SINGHANIAChairman & Managing Director

    DR. WOLFGANG HOLZBACHDirector

    VICE PRESIDENT (LEGAL) & COMPANY SECRETARYPawan Kumar Rustagi

    CIN: L67120RJ1951PLC045966

    Website: www.jktyre.com

    Annual Report 2015-16 | 5

  • Our commitment to endure resulted in outperformance across 2015-16.We reported the highest volumes in any single year. We retained our national leadership in the truck and bus radial (TBR) segment.We created a stronger Company

    6 | JK Tyre

  • %, estimated growth (by volume) of Indias tyre sector, 2015-16

    6

    %, radialisation (volume) of Indias Truck/Bus segment, 2015-16

    44

    %, estimated growth (volume) of Indias passenger car radial segment, 2015-16

    8

    %, JK Tyres growth (by volume), 2015-16

    9

    %, radialisation of JK Tyres Truck/Bus segment, 2015-16

    53

    %, growth (volume) of JK Tyres passenger car radial segment, 2015-16

    14

    Annual Report 2015-16 | 7

  • At JK Tyre, our commitment to build an enduring company was sustained.Through world-class practices, products, technologies and benchmarks.

    8 | JK Tyre

  • Water One of the lowest

    consumers of water per tonne of tyre

    manufactured in the world

    Product First company in India with

    OE fitment of tubeless passenger radials. First in India to launch high performance H, V and

    Z-rated passenger radial tyres

    Pioneering First Indian company

    to launch an eco- friendly green tyre

    Technology First in the world to install the On level Tyre Test Machine,

    generating real-time data in tyre testing

    Energy One of the lowest

    consumers of energy per tonne of tyre

    manufactured in the world

    Standards First company in Asia to receive ISO 50001

    certification for Energy Management, and second

    such company in the world

    Branding First company in India to have taken over an FIA-accredited racing series the Formula

    BMW Asia

    Productivity One of the

    highest per person productivity

    benchmarks in Indias tyre industry

    OE relationships First tyre vendor selected

    by Suzuki Motor Corporation to work on its Swift model from the drawing board onwards

    Knowledge First company in India to

    commission an independent research and development centre HASETRI (Hari Shankar Singhania

    Elastomer & Tyre Research Institute), a one-of-its-kind state-

    of-the-art R&D centre in the Asia Pacific region.

    Quality The company strives

    to maintain highest standards

    of product quality and customer

    services: compliance with Global

    Quality Standards. Quality is a

    creed in the Company.

    Annual Report 2015-16 | 9

  • Corporate snapshot

    JK Tyre is one of Indias leading tyre brands and among the 25 largest tyre companies in the world.Background The company is a part of the century-old JK Organisation, one of Indias leading private sector conglomerates with a multi-product, multi-location and multi-business operations.

    Presence The companys manufacturing operations comprise 12 modern

    plants strategically located across the country Mysuru, Banmore, Kankroli , Chennai and Haridwar.

    The company has 141 JK Tyre selling points pan-India which service the growing needs of more than 4000 dealers.

    Besides, the company markets products through 23 JK Tyre Truck Wheels (fully equipped tyre service centre) and 150+ JK Tyre Steel Wheels (exclusive passenger car tyre retail).

    REVENUE SEGMENTATION

    BY GEOGRAPHY

    India 86% Mexico 14%

    BY CUSTOMER

    OEM 33% Replacement 57% Export 10%

    BY PRODUCT

    Commercial 74% Passenger line 21% Others 5%

    10 | JK Tyre

  • BrandsThe Companys tyres are marketed under the brands of JK Tyre, Vikrant and Tornel.

    Our missionBe a customer-obsessed company where the customer comes first 24x7

    Be Indias number one tyre brand

    Be the most profitable tyre company in India

    Sustain a motivated and committed team for performance excellence

    Be widely respected for green practices

    Deliver enhanced value to all stakeholders

    Widen global presence through acquisitions/joint ventures/strategic partnerships

    2015-16 121

    2014-15 63

    2013-14 65

    2012-13 62

    2011-12 40

    New products launched

    Annual Report 2015-16 | 11

  • Ranked No. 1 in Customer Satisfaction by JD Power Asia Pacific Study 2015

    Awarded Brand of the Year 2015 by World Branding Forum, London

    JK Tyre recognised by

    national and international

    bodies

    Market statusJK Tyre is Indias leading tyre company present in all tyre segments. The Company enjoys the highest market share in truck / bus radials in India; it is amongst the largest players in Indias truck bias and passenger car segments as well.

    Key institutional partnersJK Tyre is a preferred supplier to all leading automotive Original Equipment Manufacturers like Maruti Suzuki, Tata Motors, Honda, Hyundai, Ashok Leyland, Mahindra & Mahindra, Volvo Eicher, General Motors, Volkswagen, Fiat, Nissan, TAFE, BEML and Caterpillar India, among others.

    PerformancePerformance by geography (standalone) JK Tyre grew its domestic business 9% by volume following extensive marketing, distribution and branding initiatives.

    JK Tyre achieved exports of H 581 crores.

    Performance on consolidated basis Revenues were H 7654 crores in 2015-16

    EBIDTA grew 22.2% to H 1158 crores.

    Profit after tax grew 40.7% to H 464 crores.

    EPS grew from H 15.68 to H 20.45 (on the face value of H 2 per share)

    Strategic acquisition JK TornelJK Tyre acquired a tyre company (three manufacturing plants) in Mexico in 2008, an opportunity to enhance capacity at a low cost and establish its international manufacturing footprint. Within just eight years, the plant moderated employees by 10 per cent and more than doubled turnover. JK Tornel has widened the companys global footprint through its free access to NAFTA and trade blocks, contributing attractively to revenues and bottomline.

    JK Tornel has a capacity of 8.3 million tyres per annum with three plants in Mexico (Azcapotzalco, Tultitlan and Hidalgo.

    JK Tornel enjoys strategic tie-ups with leading OEMs including Chrysler, Volkswagen, Nissan (car/light truck radial) and John Deere (Farm).

    Credit ratingThe companys credit rating has been progressively upgraded by leading credit rating agencies.

    Long-term facilities: CARE AA- (earlier CARE A+)

    Short-term facilities: CARE A1+ (earlier CARE A1)

    JK Tyre -TATA Motors Best Supplier of the Year - at TATA Motors vendors conference 2015 in Pune

    National Award for Excellence in Talent Management 2015

    National Energy Conservation Award 2015 - CTP

    5th Annual Greentech CSR Award - 2015

    Data Quest Business Technology Award 2015

    Express Security Strategist Awards 2015

    Awards and appreciation

    Annual Report 2015-16 | 13

  • This is how we outperformed in a challenging 2015-16

    Even as the financial year under review proved challenging for Indias tyre sector, JK Tyre reported superior financials. This sectoral outperformance was achieved through tight cost controls, improved product quality, superior service, stringent terms

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