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Wheels India Ltd.

BSE: 590073 | NSE: WHEELS |

Represents Equity.Intra - day transactions are permissible and normal trading is done in this category
Series: EQ | ISIN: INE715A01015 | SECTOR: Auto Ancillaries

BSE Live

Sep 17, 16:00
789.55 -7.90 (-0.99%)
Volume
AVERAGE VOLUME
5-Day
2,745
10-Day
2,122
30-Day
3,057
4,216
  • Prev. Close

    797.45

  • Open Price

    788.90

  • Bid Price (Qty.)

    778.90 (1)

  • Offer Price (Qty.)

    799.00 (100)

NSE Live

Sep 17, 15:59
786.05 -10.70 (-1.34%)
Volume
AVERAGE VOLUME
5-Day
18,369
10-Day
17,639
30-Day
22,088
26,219
  • Prev. Close

    796.75

  • Open Price

    797.50

  • Bid Price (Qty.)

    786.05 (135)

  • Offer Price (Qty.)

    0.00 (0)

Annual Report

For Year :
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Director’s Report

The Directors present their Forty Eighth Annual Report and the Audited Accounts for the year ended 31st March, 2007. Financial Results Sales for the year under review were Rs. 1003 crores compared to Rs.843 crores in the last year. The financial results of your Company for the year under review are as below: 2006-2007 2005-2006 (Rupees in Lakhs) Gross profit before interest and depreciation 8,593 7,826 Interest 2,052 1,743 Depreciation 2,672 2,316 Profit before tax for the year 3,869 3,767 Profit after tax for the year 2,603 2,637 Dividend Two interim dividends totaling to 65% amounting to Rs.6,41,51,386/- were paid for the year ended 31st March, 2007. The Directors are not recommending any further dividend for the year ended 31st March, 2007. Management Discussion and Analysis The Indian economy saw a growth rate of 9.4% in the year under review compared to 8.4% in the earlier year. The growth was largely on account of manufacturing and services both of which had double digit growth. The agricultural sector grew at only 2.7% as against 6% in 2005-06. In the commercial vehicle segment the market saw a growth of 35% fuelled by increasing conversions from single to multi-axle vehicles. This trend has been sustained following the Supreme Court ruling last year on overloading and the economics of higher fuel cost. The major part of the wheels requirement arising from this growth was met from supply of low cost wheels from China. However, your Company saw a growth of 17% in commercial vehicle wheels segment. In the coming year, demand for haulage trucks is expected to be lower. The tractor segment following the higher agricultural growth in 2005-06 and government policies to increase rural funding registered a 23% growth. Your company grew with the market and maintained its position as the leading supplier to tractor manufacturers. The passenger car segment witnessed a growth of 22% in the year under review. The higher interest rate which came into force would have some effect on the domestic demand for passenger cars. With a number of passenger car manufacturers having aggressive growth plans including those for exports, demand for passenger car wheels is expected to grow and your Company is expected to benefit from this. The government has been concerned about the high inflation and has taken steps to control liquidity. This has resulted in hardening of interest rates compared to the last financial year. We expect tightening of money supply to slow down segments such as commercial vehicles and agricultural tractors. The Company is the major supplier to the construction equipment industry in India and the year under review saw a 50% increase in off-take from the earlier year. This trend is likely to increase with infrastructure activity in the country speeding up and with global customers setting up export based plants in India. Air Suspension system saw an increase of 45% in sales with higher level of OE fitment with Tata Motors and Ashok Leyland. Your Company is participating in a number of new bus programs including the City Low Floor buses. We see the growth in this segment sustaining in the coming year. The Company saw a 24% growth in its export sales coming mainly from the construction equipment industry worldwide. The industry is showing a double digit growth globally and your Company is well positioned to take advantage of this. On aluminium wheels, we have marketed our product to trailer manufacturers in major geographies through our existing distribution set-up. We are in early discussions with international OEMs on supply of forged aluminium wheels to them. The Company is starting two new plants in the coming year, one in Uttaranchal to service Tata Motors and Mahindra plants in the state, and one in Sriperumbudur to service the plants of the domestic construction equipment industry. These new plants should contribute to the sales of your Company in the latter part of the current year. The Company's products are steel intensive. The price levels in the country have remained high reflecting the demand-supply mismatch in the country. While your Company continues to work on cost reduction measures through value engineering methods, high steel prices and high interest rates will continue to put pressure on us in the coming year. It has been through the team work and effort of your Company's employees that we have been able to manage our operations in these difficult times. The internal control systems of the Company are adequate and are regularly reviewed by the internal and statutory auditors. The Internal audit is conducted at regular intervals at all the locations of the Company covering all key areas. The audit observations and follow-up actions are discussed with the management and the audit committee and reviewed at regular intervals. Directors Under Article 94(3) of the Company, Mr T S Vijayaraghavan and Mr S Prasad, retire from office by rotation, and being eligible, offer themselves for re-appointment. Corporate Governance In pursuance to Clause 49 of the Listing Agreement with the Stock Exchange, Corporate Governance Report is given elsewhere and forms part of this Report. Directors' responsibility statement: Pursuant to Section 217(2AA) of the Companies Act, 1956 your Directors confirm that i. in the preparation of the annual accounts, the applicable accounting standards have been followed; ii. such accounting policies have been selected and applied consistently and judgements and estimates made that are reasonable and prudent so as to give a true and fair view of the state of affairs of your company as at 31st March, 2007 and of the profit of the Company for the year ended on that date; iii. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities and iv. the annual.accounts have been prepared on a going concern basis. Auditors M/s Sundaram and Srinivasan, Chartered Accountants, Chennai retire at the conclusion of the Forty Eighth Annual General Meeting and are eligible for re-appointment. The Directors recommend their re-appointment. Particulars of Employees None of the employees of the Company was in receipt of remuneration in excess of the limits prescribed under Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975. General Particulars prescribed by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are enclosed in the annexure and form part of this report. The Directors wish to thank United Bank of India, State Bank of India, Standard Chartered Bank and HDFC Bank Limited for their continued support. The Company continues to enjoy the full cooperation of all its employees. The Directors wish to place on record their appreciation of the good work done by them. On behalf of the Board of Directors Chennai S Ram 21st June, 2007 CHAIRMAN & MANAGING DIRECTOR Annexure to the Directors' Report Conservation of Energy Your Company has been shifting towards non conventional energy sources. Currently, 20% of our main plant at Padi's energy requirements are met by wind generators. We have also increased the level of natural lighting at our plant to double last year's level and have started the process of converting to turbo ventilation which does not require power. In addition, energy conservation audits are taken up and optimal use of energy is ensured in utility equipment like compressors, chillers & fluid heaters. Technology Absorption During the year under review, your Company has successfully developed 237 new wheels to meet customer requirements using in-house design facilities. In addition, your company has developed air suspension systems for ultra low floor city bus applications that are coming up in the country. Expenditure on R & D (Rs. in Lakhs) Capital 62.32 Revenue 409.99 472.31 Total as a percentage of turnover 0.47% Foreign Exchange Earnings and Outgo The foreign exchange outgo to the Company during the year under review was Rs.9999 lakhs and the foreign exchange earned was Rs. 18277 lakhs. Chennai S. Ram 21st June, 2007 Chairman & Managing Director

Director’s Report