Rochak Saxena

ROCHAK SAXENA B.COM HON.
II YEAR
INTRODUCTION
Ceat Ltd, a part of the RPG Goenka group, is the second largest tyre
manufacturer in the country after MRF. Ceat manufactures truck & bus,
passenger car, scooter and LCV tyres. The company is a dominant player in the
truck & bus and passenger car tyre segments with a market share of 14% and
17% respectively. In FY2000, Ceat did well to posting a 21%yoy sales growth in
the replacement market for truck & bus tyres. It is presently focusing on
catering to the fast growing passenger car and two-wheeler industry. Towards
this, it is commissioning a new radial tyre factory in June 2000.
Industry basics
Tyre industry is capital intensive and as capacities come in spurts, it leads to
constant demand-supply imbalances and consequent cyclicality in prices.
Variable cost is also very high, with raw materials forming nearly 70% of the
costs. Profit margins are therefore thin. Production process is technology
intensive and globally huge sums are invested in R&D. Tyre demand is a derived
demand, dependent on the auto industry, both for OEM and replacement
market. The major segments are Truck & Bus (T&B) tyres and car tyres. Value
share of T&B segment is about 73%. This segment is highly competitive and
margins are typically lower than in the car tyres segment. Replacement market
forms the largest segment (about 58%), followed by OEM (about 22%). Export
accounts for about 15%. With global demand slowing down, there is a
consolidation of capacities through mergers etc. The domestic tyre industry
broadly mirrors the market characteristics of the global industry. However, due
ROCHAK SAXENA B.COM HON. II YEAR
to rough road conditions, the more rugged, suitable and cheaper cross ply tyres
are in vogue. Consumption of natural rubber is, therefore, proportionately
igher. The government has decided to impose 10% safeguard duty on carbon
black and hiking benchmark prices of natural rubber (25-30% of sales) in
February 1999. Its impact was felt only to an extent as prices of these
commodities are ruling at historical lows in the global market.
Ceat is part of the RPG group, which is diversified, with presence in major
sectors like power, fertilizers, pharmaceuticals, tyres, computer, telecom,
financial services etc. The group stumbled trying to grow via diverse platforms
and has many companies that have turned sick. But lately the strategy seems
to be one of restructuring and consolidation. The group is divided into 4 broad
areas - rubber & allied products, power, electronics & telecom and chemicals.
Ceats investments in its subsidiaries have also come down this fiscal which is a
sign of prudence on the management.
BUSINESS DESCRIPTION
Ceat is a manufacturing company, which produces rubber, tire, nylon fabric
products, nylon tire yarn, glass fiber, automotive flaps, filament mats and other
rubber products for the automotive markets in India. The company has a well
established research and development center that evaluates the application
and development of new raw materials, compounds and tire sizes. It produces
tires for two and three wheeled vehicles, passenger cars, LCVs, trucks and
buses. Ceat exports to almost 50 countries, with the US being the largest
destination.
The company also provides investment financial services through Meteoric
Industrial Finance and Atlantic Holdings. Automotive tire sales account for
around 90% of revenues, automotive tubes account for about 8% and the
remaining revenues come from other non-core operations.
The company is pursuing a strategic initiative of intensifying outsourcing to
expand its product range and increase production volumes. Ceat has an
agreement with Pirelli of Italy for outsourcing radial tires which are being
marketed under the CEAT Spider Radials brand name.
CEAT INDIA
Ceat Limited is a manufacturer of tires in India. Automotive tires comprise the
largest part of the Company's revenue, however it also produces tire flaps,
rubber tubing and nylon thread. The Company also offers financial services
through Ceat Financial Services Limited, including hire purchase, office
equipment finance, container and equipment/infrastructure leasing and money
market operations.
COMPANY OVERVIEW
How the company grew from bottom to top

History
CEAT stands for Cavi Electrici Affini Torino (Electrical Cables and Allied Products
of Turin).
CEAT International was first established in 1924 at Turino in Italy and
manufactured cables for telephones and railways.
In 1958, CEAT came to India, and CEAT Tyres of India Ltd was established in
collaboration with the TATA Group.
In 1982, the RPG Group took over CEAT Tyres of India, and in 1990, renamed the
company CEAT Ltd. 5
CEATs PRODUCT RANGE
Truck radial tyre section
Industry basics
Tyre industry is capital intensive and as capacities come in spurts, it leads to
constant demand-supply imbalances and consequent cyclicality in prices.
Variable cost is also very high, with raw materials forming nearly 70% of the
costs. Profit margins are therefore thin. Production process is technology
intensive and globally huge sums are invested in R&D. Tyre demand is a derived
demand, dependent on the auto industry, both for OEM and replacement
market. The major segments are Truck & Bus (T&B) tyres and car tyres. Value
share of T&B segment is about 73%. This segment is highly competitive and
margins are typically lower than in the car tyres segment. Replacement market
forms the largest segment (about 58%), followed by OEM (about 22%). Export
accounts for about 15%. With global demand slowing down, there is a
consolidation of capacities through mergers etc. The domestic tyre industry
broadly mirrors the market characteristics of the global industry. However, due
to rough road conditions, the more rugged, suitable and cheaper cross ply tyres
are in vogue. Consumption of natural rubber is, therefore, proportionately
higher. The government has decided to impose 10% safeguard duty on carbon
black and hiking benchmark prices of natural rubber (25-30% of sales) in
February 1999. Its impact was felt only to an extent as prices of these
commodities are ruling at historical lows in the global market.
Ceat is part of the RPG group, which is diversified, with presence in major
sectors like power, fertilizers, pharmaceuticals, tyres, computer, telecom,
financial services etc. The group stumbled trying to grow via diverse platforms
and has many companies that have turned sick. But lately the
strategy seems to be one of restructuring and consolidation. The group is
divided into 4 broad areas - rubber & allied products, power, electronics &
telecom and chemicals. Ceats investments in its subsidiaries have also come
down this fiscal which is a sign of prudence on the management.

Indian Tyre Industry
The tyre industry has witnessed a CAGR of 8.3% over the last decade mainly
fuelled by the strong growth in the domestic auto industry. Though the
replacement market has driven the industry growth for long time, the OEM
market has seen a robust growth over the last couple of years.
The industry is highly capital intensive, as it requires around Rs4bn to setup a
radial tyre plant with a capacity of 1.5mn tyres and around Rs1.5-2bn for a
crossply tyre plant of a capacity to manufacture 1.5mn tyres.
The profitability of the industry has high correlation with the prices of key raw
materials such as rubber and crude oil as they account for more than 70% of
the total costs. The raw material to sales ratio in the industry is around 65%.
The industry is dominated by four players viz MRF, Apollo Tyres, JK Industries
and Ceat and enjoys more than 70% of the total market share.
The fortunes of the industry are linked to the trend in the domestic auto
industry, retreading, trend in road transportation and spending on road
infrastructure.
The companies have lined up further expansion plans to meet the increasing
demand.
India Infoline Sector Studies : Indian Tyre Industry is available in Acrobat Reader
(PDF) format. The Report provides exhaustive information on the Indian Tyre
Sector, the demand drivers, trends in the industry (with respect to production,
exports, market share), key characteristics of the Indian market and profile of
leading players in India.
11
ORGANISATIONAL BODY
Enjoy what you do, do your best and keep learning.
Mr. Anant Goenka
Managing Director
Mr. Anant Vardhan Goenka is an M.B.A from the Kellogg School of
Management and a B.SC in Economics from the Wharton School.
Mr. Goenka joined KEC International Limited (KEC) as Vice President
(Corporate) and was in charge of the telecom business, business
development in North America and Integrated planning and monitoring of
Transmission and Distribution Business. In recognition of his contribution
in the said business vertical, KEC elevated him to the position of Executive
Director Supply Chain in-charge of manufacturing, procurement,
planning, logistics and quality department in the company.
Prior to joining KEC, Mr. Goenka was also associated with CEAT Limited as
Head of Specialty Tyre Business. Earlier, Mr. Goenka has also worked with
Hindustan Unilever Limited, Accenture, Mumbai and Morgan Stanley,
Hong Kong. Mr. Goenka has a total work experience of 10 years.
13
Mr. Manoj Jaiswal
Chief Financial Officer
Chief Financial Officer CEAT Limited
"Manoj Jaiswal is the CFO for CEAT Limited. In addition to Finance, Manoj is also
responsible for Information Technology in CEAT and therefore driving both
Financial and Business Excellence. Before joining CEAT, Manoj had spent 17
years in Wipro in various capacity where he joined immediately after qualifying
his Chartered Accountancy and completing article-ship from Price Water House
Coopers. Amongst many roles in Wipro in 17 years Manoj was the CFO for BPO
business and thereafter he was heading Treasury and Investor Relations
Globally for Wipro. He has co-steered the BPO business to one of the fastest and
most profitable business in the BPO industry along-with the Business Head.
During his tenure as Head of Treasury and Investor Relations, Wipro underwent
a Demerger of its Non IT Business and Manoj was a key member in this
initiative.
Manoj is a Commerce Graduate and a Chartered Accountant. In his leisure time,
Manoj enjoys music, movies, running, cycling and photography"
15
Mr. Arnab Banerjee
Executive Director -
Operations
Mr. Arnab Banerjee is the Executive Director Operations for CEAT Limited. He
joined CEAT in the year 2005 as Vice President, Sales and Marketing. Under his
leadership, CEAT has seen innovations in the Marketing initiatives, Sales and
Distribution strategy and seamless Supply Chain processes over the last 10
years. He also oversees all the manufacturing plants of CEAT.
Prior to his joining CEAT, Mr. Banerjee has worked with Marico Limited and
Berger Paints Limited in the various sales and marketing domains. He has the
total experience of more than 28 years.

17
Mr. Tom Thomas
Executive Director -
Technology & Projects
BACHELOR OF RUBBER TECHNOLOGY AND ENGINEERING FROM UNIVERSITY OF
COCHIN AND HAS 40 YEARS OF EXPERIENCE IN TYRE INDUSTRY OF INDIA. HE
WAS ASSOCIATED WITH THE INTRODUCTION OF PASSENGER RADIAL
TECHNOLOGY IN INDIA BY J K TYRES IN 1977 AND WAS RESPONSIBLE TO SET UP
THE FIRST ALL STEEL TRUCK/BUS RADIAL FACILITY AT MYSORE IN 1999. HE HAS
HELD POSITIONS LIKE CHAIRMAN OF INDIAN TYRE TECHNICAL ADVISORY
COMMITTEE, MEMBER OF INDIAN RUBBER INSTITUTE, GOVERNING COUNCIL
MEMBER OF INDIAN RUBBER MANUFACTURERS RESEARCH ASSOCIATION,

MEMBER OF ACADEMIC COUNCIL OF UNIVERSITY OF COCHIN, GUEST FACULTY
OF VARIOUS COLLEGES.
HE SPENT 17 YEARS IN APOLLO TYRES, WAS THE LEADING MEMBER OF THE
TEAM WHO SET UP APOLLOS BARODA PLANT AND WAS HEADING THEIR R&D /
TECHNOLOGY DEPT.
19
Mr. Dilip Modak
Senior Vice President -
Manufacturing, CEAT LTD, Mumbai w.e.f 2nd May-2013
Professional Qualifications: -
Post Graduate Diploma in Business Administration (HR)
Graduation in Industrial Engineering
Profile Summary:
Currently leading the manufacturing of CEAT LTD with plants across four
locations - Mumbai, Nashik, Vadodara and RADO - Kochi. Also leading CoE
(Center of Excellence)- Manufacturing of RPG group companies.

30 years experience of handling Plant Operations, Sourcing & Supply
Chain Management, Total Quality Management, Human Resources and various
manufacturing/re-engineering projects.
Engaged with industry leaders like CUMMINS INDIA LIMITED AND
MAHINDRA & MAHINDRA LIMITED.
In depth exposure to new product development, developing suppliers as
business partners, HR issues at plant level and facilitate continuous
improvement in safety, quality, cost, delivery and productivity.
21
Mr. Chandrashekhar
Ajgaonkar
Senior Vice President -
Quality Based Management
Mr. Chandrasekhar Ajgaonkar is the Senior Vice President QBM CEAT and
Corporate Business Excellence Centre- RPG Group. He joined the RPG Group in
the year 2005 as Corporate Quality Head and from 2011 performng in dual role
of Head QBM CEAT and Corporate Business Excellence head. Under his
leadership, RPG Group and CEAT has successfully implemented Business
Excellence initiatives over the last 10 years.

At present ,Under his guidance & leadership CEAT has started its TQM Journey
and aming for international award by the year 2017. He also oversees the
initiatives of Centre of Excellence for RPG Group.
Prior to his joining RPG and CEAT, Mr. Chandrashekhar Ajgaonkar has worked
with Mahindra & Mahindra, Crompton Greaves Ltd, Eicher Tractors Ltd, and
Eicher Consultancy Services in operations and TQM domain. He has the total
experience of more than 28 years
23
Mr. Kumar Subbiah
Senior Vice President
Kumar Subbiah is the Senior Vice President Materials & Outsourcing for Ceat
Limited. He joined Ceat in Feb 2015 after spending little over 20 years with
Unilever & Hindustan Unilever where he handled various Finance & Commercial
roles in India and outside India.

Kumar is a B.Com Graduate from Loyola College, Chennai. He is also a
Chartered Accountant and a Cost Accountant with professional interests both in
Finance & Supply Chain.
He is fond of Macro Economics and Information Technology. In his free time, he
enjoys playing Flute, Photography and watching Bollywood movies & Basketball.
25
MARKETING STRATEGY
Boards okay Harrisons rubber division merger with Ceat
Our Bureau
MUMBAI, April 19
THE process of consolidating the rubber business of the Rs 6,700-crore RPG
Enterprises got under way with the boards of Ceat Ltd and Harrisons Malayalam
Ltd (HML) approving the scheme of arrangement involving the demerger of the
rubber division of HML and its transfer to Ceat.

The appointed date of the Scheme of Arrangement is fixed as October 1, 2002.
Under the demerger plan for HML, Ceat will issue 95,03,900 equity shares of Rs
10 each to HML and 36,91,081 equity shares of Rs 10 each to the shareholders
of HML in the ratio of one share for five equity shares held by these
shareholders.
The existing paid-up capital of HML will be reduced from Rs 18.45 crore to Rs
9.23 crore by reducing the paid-up value of each equity share of Rs 10 each to
Rs 5 each. Besides, Ceat's investment portfolio will be demerged and
transferred to Meteoric Industrial Finance Company (MIFL), one of Ceat's non-
banking financial subsidiaries.
Post this issue of shares, MIFL will cease to be a subsidiary of Ceat and an
application will be made to the Bombay Stock Exchange for listing the company.
27
The objective of this consolidation is to strengthen the rubber business by
creating backward integration for Ceat, an official press release said quoting Mr
Harsh Goenka, Chairman, RPG Enterprises.
"With the merger of HML's rubber division and the divestment of all its non-tyre
assets Ceat will be able to focus on its tyre business and also improve its option
for sourcing this important raw material for its tyre manufacturing activities and
bring about synergistic effects,'' RPG Enterprises said in the press release.
Ceat had earlier said that the merger of the rubber division of HML with itself
would improve the company's options for sourcing this important raw material
for its tyre manufacturing activities and bring about synergic effects.
HML's rubber division has a turnover of Rs 50 crore from a crop output of about
10,000 tonnes per annum, while Ceat's natural rubber consumption was
approximately 50,000 tonnes worth Rs 260 crore last year.
As regards HML, the demerger of the rubber division will help it to focus on its
core business area of tea. The financial restructuring would enable the business
to grow not only its tea business but also consider expansion into new
agriculture related food products, the Board of HML also gave its approval for a
scheme of amalgamation of its 100 per cent subsidiaries, Harrisons Agro
Products Ltd, Harrisons Rubber Products Ltd and Harrisons Malayalam Financial
Services Ltd with itself.
29
The valuers to the Scheme are SBI Capital Markets & KPMG and the advisors are
Lodha & Co.
The scheme is subject to the sanction of the courts and the National Company
Law Tribunal. Ceat, MIFL and HML and its subsidiaries will apply to the High
Courts for approval. Khaitan & Co has been appointed as advocates to the
scheme for this purpose.
Ceat Limited
AVAILABLE NOW! LABOR PRODUCTIVITY BENCHMARKS AND VERTICAL
GAP ANALYSIS ON Ceat Limited
Published today by ICON Group International, Ltd. Two of the most
comprehensive studies to date on labor productivity and vertical gap analysis
benchmarks for Ceat Limited (BOM).
The methodologist for this unique study is Philip Parker, Eli Lilly Chair Professor
of Innovation, Business and Society at INSEAD (Fontainebleau, France and
Singapore). According to Professor Parker, With the globalization of markets,
greater foreign competition, and the reduction of barriers to entry, it becomes
all the more important to benchmark a companys financial indicators on a
worldwide basis. World stock markets have recently witnessed a return to
fundamental financial analysis. The goal of the reports is to assist consultants,
financial managers, strategic planners, and corporate officers in gauging certain
indicators of Ceat Limiteds financial and human resource structure.
31
The report has benchmarked Ceat Limited against competing firms in the Tires
and Inner Tubes Manufacturing industry worldwidegoing beyond traditional

methods of company benchmarking. The results are two specialized reports: (1)
global financial benchmarks using common-size statement ratios (vertical
analysis), and (2) labor productivity and utilization measures collected across
borders.
Coverage
Two reports, financial ratios and labor productivity ratios, are available for Ceat
Limited. Each report reveals productivity and industry ranks for Ceat Limited in
the Tires and Inner Tubes Manufacturing industry. Reports for the following and
many other Tires and Inner Tubes Manufacturing companies are available now:
Bridgestone Corporation
Brisa Bridgestone Sabanci Lastik Sanayi ve Ticaret AS
Ceat Limited, Compagnie Financiere Michelin, Compagnie Generale des
Etablissements Michelin
Continental AG
Cooper Tire & Rubber Co
DMIB Berhad (Malaysia)
Dunlop Africa Limited
Feng Tay Enterprise Co Ltd
Goodyear (Thailand) Public Company Limited
33
Heung Ah Corp
Kenda Rubber Industrial Co., Ltd.
Kumho Industrial Company Limited
Marangoni S.p.A.
Nexen Tire
Pirelli S.p.A.
Sumitomo Rubber Industries Ltd.
The Goodyear Tire & Rubber Co
Toyo Tire & Rubber Co., Ltd.
Vredestein NV
Yokohama Rubber Company, Limited
The vertical analysis deals with questions like: How has Ceat Limiteds
asset structure varied compared to global benchmarks for the Tires and
Inner Tubes Manufacturing industry? Does it generally hold more cash and
other short-term assets, or does it tend to concentrate its assets in
physical plant and equipment? On the liability side, does Ceat Limited
typically have a higher percent of payables compared to the benchmarks,
or does it hold a higher concentration of long-term debt? Does Ceat
Limited have a relatively higher cost of goods sold, operating costs, or
income taxes compared to global benchmarks? Have Ceat Limiteds
returns on equity been higher or its profit margins greater?
While the labor productivity analysis answers the following: What has
been the ratio of short-term and long-term assets to employee? What are
typical capital-labor ratios? What are the average sales and net profits per
employee compared to global benchmarks?

35
Professor Parker notes, "We are intrigued by the wide variations in
basic financial and productivity measures between Ceat Limited and
other Tires and Inner Tubes Manufacturing companies. The Earnings
Before Interest And Taxes (EBIT), for example, varied from -2.1 to
64.21. We see this type of variation in the hundreds of ratios that we
estimate.
LIMITATION OF THE RESEARCH
This report is for information purposes only and does not construe to be any
investment, legal or taxation advice. It is not intended as an offer or solicitation
for the purchase and sale of any financial instrument. Any action taken by you
on the basis of the information contained herein is your responsibility alone and
India Infoline Ltd (hereinafter referred as IIL) and its subsidiaries or its
employees or directors, associates will not be liable in any manner for the
consequences of such action taken by you. We have exercised due diligence in
checking the correctness and authenticity of the information contained herein,
but do not represent that it is accurate or complete. IIL or any of its subsidiaries
or associates or employees shall not be in any way responsible for any loss or
damage that may arise to any person from any inadvertent error in the
information contained in this publication. The recipients of this report should

rely on their own investigations. IIL and/or its subsidiaries and/or directors,
employees or associates may have interests or positions, financial or otherwise.
37
DATA COLLECTION
The present study contemplated an exploratory research.
Secondary data: secondary data which is already available and
published .it could be internal and external source of data.
Internal source: which originates from the specific field or area where
research is carried out e.g. publish brouchers, official reports etc.
External source: which originates outside the field of study like books,
periodicals ,journals, newspapers and the internet.
Ceat Limited. The Group's principal activities are to manufacture and
distribute automotive tyres, tubes and flaps. The products include nylon
fabric, nylon tyre yarn, glass fibre, automotive flaps, filament mats and
other rubber products. The Group also provides investment financial
services. The Group supplies to over 50 countries with the major business
links in the United States of
DATA PRESENTATION AND ANALYSIS

This Report features up to a ten-year record of the equity Price history for
Ceat Limited. Tabular results include the High, Low and Closing price for
the quarter. There is also a calculation of percentage change in price for
both Quarterly and Annual periods. Price values America, Singapore, the
United Arab Emirates, Bangladesh, Philippines, Afghanistan, and Nigeria
and other Asian, Middle East and African countries.
39
Layout and Content of a Typical Report

41
Tyre Industry April 2004 update

The tyre production in India witnessed a growth of 29.8% on a yoy basis in the
month of April 04. The most significant growth was seen in the production of the
passenger car segment, which saw a jump of 59% to 936,853 in April 2004 as
against 588,238 in April 2003. Other significant segments were the motorcycle
segment and the tractor segment. The motorcycle segment witnessed a growth
of more than 29% and the tractor segment (Front, Rear and Trailer) registered a
growth of more than 25%.
The contribution of the tyre and bus segment to the total production in
April 2004 reduced to 18.8% from 21.6% in April 2003. The passenger car
segment, which contributed 16.3% in April 2003, increased its share in
total production to 20%. The share of the tractor segment decreased from
5.1% to 4.9% for the same period.
If any indication from these figures have to be taken, the growth in the
passenger segment would be more than that in the commercial vehicle
segment in the near future. In the recent past, there has been an
ostensible shift in the demand of two wheelers from scooters to
motorcycles. The figures for the production of tyres in the respective
segment envisage the scenario to continue in the near term. Above
average pre-monsoon showers are expected to give positive triggers to
the demand of tractors. Increasing production of tractor tyres is an
indicator for the same.

Exports of tyres grew by a substantial 39.6% in April 2004 to 291,409
from 208,710 in April 2003.
43
The major contributors to this growth were the passenger car and the
scooter segments by registering a growth of 200% and 293%. During
FY04, exports contributed to the tune of 20.6% and 6% to total production
of tyres in truck & bus and passenger car segments respectively.

Business Description: Ceat Limited. The Group's principal activities are to
manufacture and distribute automotive tyres, tubes and flaps. The products
include nylon fabric, nylon tyre yarn, glass fibre, automotive flaps, filament
mats and other rubber products. The Group also provides investment
financial services. The Group supplies to over 50 countries with the major
business links in the United States of America, Singapore, the United Arab
Emirates, Bangladesh, Philippines, Afghanistan, and Nigeria and other
Asian, Middle East and African countries.

Exporting technologically advanced products
From five world-class plants, three in India and one in Sri Lanka, we
manufacture a wide range of tyres for all user segments including trucks,
buses, and LCVs. We also export farm, industrial, grader, OTR, car, scooter,
auto-rickshaw, motorcycle and passenger car radials.
Enjoying large market shares

Our individual market shares include 64% in Singapore, 22% in UAE and
22% in Philippines. We also send our products into USA, Bangladesh,
Pakistan, Vietnam, Iran, Nigeria, Egypt and other African, Middle-East and
Far-East Asian countries.
45
Meeting global standards
With our manufacturing processes being globally approved by DOT
(Department of
Business
Ceat is the second largest tyre manufacturer in the country. In FY2000, it
produced 5.72mn number of tyres as compared to 5.24mn units in FY99, a rise
of 9%yoy.
Tyres
Ceat manufactures truck & bus, passenger car, scooter and LCV tyres. Ceat has
an extensive distribution network of more than 3,000 dealers. Though known for
its quality and successful brands such as Formula I, Endura, Secura, Samrat,
Maestro, Stamina etc, market aggressiveness has been much lower than
competitors like MRF or Apollo. During the year, Ceat posted a rise of 21%yoy in
truck tyre sales in the replacement market in value terms. This was made
possible by the 22%yoy increase in the production of truck tyres. In FY2000,
sales of tyres contributed to 90.3% to the total turnover. During the year, the
company has launched new products under the brand names Fleet Master,
Turbo Lug and Elevata.
Tubes and flaps
The company does not have any production facility for manufacturing of tubes
and flaps. It sources the products from other manufacturing units. In FY2000,
sales of tubes and flaps contributed to
47
9.6% of total turnover. It sold 5.03mn tubes as compared to 4.47mn in FY99 and
1.34mn flaps as compared to 1.15mn in FY99.
Exports
Ceat is the second largest tyre exporter after J K Industries. Export sales on a
FOB basis has fallen by 9.5%yoy from Rs1.2bn in FY99 to Rs1.08bn in FY2000.
Export sales were hampered by a demand decline in the US market.
Its Sri Lankan venture Associated Ceat Pvt Ltd has a 55% share of the Sri
Lankan market. In November 1998, the company tied up with a local firm, Kelani
Tyres Ltd. This merger would have combined production capacity of 34 metric
tons. The turnover of the JV grew from Sri Lanka Rs1.29bn in FY99 to SL
Rs1.36bn in FY2000. Profit before tax rose 28%yoy to SL Rs75mn.
Expansion plans
The company has planned a capex of Rs1bn spread over the FY2000 and FY01.
While Rs400mn will be spent on capacity upgradations, Rs600mn will be utilized
for a new radial facility at its Nashik plant, which as part of the first phase will
start commercial production in June 2000. A greenfield project is likely to be set
up in the second phase. The company had taken over Rado Tyres in Kerala in
FY98 and plans to increase its manufacturing capacity from 15,000 to 40,000 in
the first phase and 70,000 in the next phase.
49
Outlook
Ceats fortunes are now (post restructuring) entirely linked to the tyre industrys
fortunes. As a leading player in the commercial vehicle, passenger car market
and two-wheeler tyre segments, it is expected that the company would take
advantage of the continuing growth in these segments. The new radial tyre
plant coming up in Nashik would help the company find a foothold in the fast
growing segment. Even in the export market, the company is reducing its
dependence on standard bias-ply products and concentrating on niches. The
company has done well by rationalizing its debt portfolio by replacing short-
term loans with long term financing from FIs. This has brought down interest
costs as has been witnessed in FY2000. However, with sale of investments in its
many subsidiaries, Ceat can no longer prop its operational income with other
income. Moreover, operating margin will be affected by the rise in prices of raw
material inputs. With augmented capacities for car radial tyres and two/three
wheeler tyres and initiatives in the field of supply chain management and
controlling costs, Ceat is expected to do reasonably well for the rest of the
fiscal.
Demand determinants
Growth of automobile industry will increase vehicle population and
thereby the demand for tyres in the OEM as well as the replacement
markets.
Relative importance of road transport and long distance travel by road
leading to increased need to replace tyres.
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Earning drivers
Raw material price fluctuations: Prices of natural rubber, an agricultural
commodity. Other raw materials are mainly petrochemical based and
movements are cyclical.

Freeing imports of radial tyres will affect margins in that segment.
Ceat Tyres targets 14 per cent growth
MUMBAI, Sept 15 (PTI) R P Goenka controlled Ceat Ltd has set a sales
target of around Rs 1400 crore for the current year while the profits of the
company are expected to increase by 14 per cent over last year.
In the first five months of the current fiscal, the company has recorded
sales of Rs 533 crore which is 19 per cent more than the corresponding
period last year, Vice-Chairman Harsh Goenka told shareholders at its
40th AGM here today.
In order to emerge as a market leader, the companys management has set a
growth target of 14 per cent against a projected industry growth of 6 per cent,
he said.
The company intends at least a one per cent growth in market shares in all the
segments it operates in, Goenka said. At present, in scooter tyres it has a
market share of 21 per cent, motorcycles 11 per cent and car tyres 19 per cent.
53
Ceats exports last year dipped to Rs 128 crore from the previous years Rs 153
crore chiefly due to the South Asian crisis and lack of demand from the US and
Latin American countries.

Essel Packaging: The Board of Directors of Essel Packaging Limited yesterday
announced payment of a special millennium dividend of 150 per cent to its
equity shareholders.
Results (FY2001)
Company Results
Scrip Code : 500878 Company Name : CEAT LTD
Type Audited Audited UnAudited Audited
Date Begin 01 Apr 04 01 Apr 03 01 Apr 02 01 Apr 01
Date End 31 Mar 05 31 Mar 04 31 Mar 03 31 Mar 02
Description
Gross Sales 17803.1 16479.5 14882.7 13613.7
Excise Duty -2523.2 -2471.2 -2750.5 -2474.7
Net Sales 15279.9 14008.3 12132.2 11139
Other Income 389.8 1222.2 275.4 234
Total Income 15669.7 15230.5 12407.6 11373
55
Expenditure -14884.4 -13817 -11417.3 -10576.7

Operating Profit 785.3 1413.5 990.3 796.3
Interest -641.9 -764.1 -478.8 -572.7
Gross Profit 143.4 649.4 511.5 223.6
Depreciation -220.6 -221 -218.4 -188.4
Profit before Tax -77.2 428.4 293.1 35.2
Tax 10 -81.6 -109 -11.2
Profit after Tax -67.2 346.8 184.1 24
Extraordinary Items 48.5 -206.2 - -
Net Profit -18.7 140.6 184.1 24
Equity Capital 351 350.9 350.9 -
Reserves 2618.1 2993.4 2932.3 -
EPS -0.53 4.01 5.24 0.68
Nos. of Shares - Non Promoters 20473118 20473118 20473318 -
Percent of Shares - Non Promoters 58.14 58.14 58.14 -
57
Result Type A A A A
Notes
ln a significant move, the Rs.1,500-crore Ceat Ltd has tied up with leading portal
Yahoo India as part of its online marketing strategy. With this tie-up the
company plans to roll out a host of online promotions and Internet ads in a bid
to connect with the youth segment. In fact shedding its fuddy buddy image,
Ceat Ltd. id now exploring new mediums to create a contact point with its
consumers.
As for Ceat's tie-ups with other portals, says Ceat Ltd vice-president (marketing)
Kalyan Paul: "We are in talks with other portals but it's too early to talk about it
now. Incidently, the company has an online presence with a Website for its
sports property Ceat Cricket Ratings. Adds Mr. Paul: This property is now being
made more accessible to cricket fans by promotion through tie-ups with portals
such as Yahoo India. Clearly, the company is now stepping up its online
marketing plans to woo the youth segment.
Cashing in on the growing popularity of Short Messaging Service (SMS) also
plans to enter this alternative medium to touch base with its target audience.
In addition to the Net, we are evaluating all formats which will help us connect
with the youth- SMS included, informs Mr. Paul.As Indian corporates are
increasingly opting for new media tools to connect with the youth segment, why
has Ceat Ltd. opted for this mode of marketing now?
59
"Since, there is a lot of synergy between two-wheeler owners and the Net
audience, the company is planning to use Internet as a medium. A plan is being
put into place to use this interactive medium to build the Ceat brand among the
youth, who are todays consumers for two-wheeler tyres and future ones for car
tyres, he adds.
To meet the objective, the company is now using tools such as e-mail
newsletters which give tyre users an opportunity to understand the brand
better.
So with these new online initiatives, is the company going for a totally new
brand image? According to Mr. Paul, the Ceat brand is strong among the target
audience and the company is not looking at changing the brand equity or
positioning. The existing brand plank Born Tough has universal and timeless
appeal, with a young and with-it audience.
"We intend to create a relationship with new users (youth) to create a market
for the future by catching consumers at the beginning of their purchase life-
cycle and maintaining a relationship based on the delivery of superior value,
he reasons.
As for the future of online marketing in India, Mr. Paul observes that in today's
dynamic media environment, online tools are enabling marketers to target their
messages more effectively to the relevant audience.

61
COMPETITORS
India is a manufacturer, expor-ter and importer of Off-The-Road (OTR) tyres.
CEAT, MRF, Goodyear, Balkrishna Tyres, Vikrant Tyres and TVS are the major
manufacturers of OTR tyres in the country. OTR tyres account for 11 per cent of
the country's total tyre market which is estimated at Rs 12,500 crore. Large-
sized OTR tyres are imported, as their demand volume is low and it makes more
economic sense to import. Also, OTR radials are not manufactured here and
they are also imported. Bridgestone, Yokohama, Michellin and Pirelli are the
MNCs supplying bigger OTR tyres in this country. Similarly, India also exports
OTR tyres to other countries including Europe and America.
OTR tyres, in India, have gained the limelight because of the government's
massive expenditure programme in infrastructure building, especially in road
construction. In fact, the government's Golden Quadrilateral project has given a
new lease of life to this otherwise sinking industry. Till 2000-01, the industry's
production was almost stagnant at around 36,000-37,000 tyres; in 2002-03, the
production of tyres crossed 50,000 numbers. And this year its performance is
expected to be even better. Industry sources claim that production of OTR tyres
should touch 72,000 during 2003-04, a growth of 44 per cent. During the first 9
months of the current year, the industry has achieved a growth of 48 per cent.
says Tom K. Thomas, Vice President (Technical), Ceat Ltd, "Growth in OTR tyres
was insignificant a few years ago. But the NHDP project has increased the
demand for these tyres. During the next few years the demand for OTRs should
grow at the rate of around 20 per cent every year."
63
Despite this the mining industry remains the main customer of OTR tyres in the
country. "Nearly 65 per cent of the demand for OTRs comes from Coal India
Ltd," says N. Ganesh, Chief Manager (R&D), Ceat Ltd. BEML and Caterpillar are
the other major customers of the industry. In the foreseeable future the mining
sector is expected to remain a major customer for OTR tyres.
An important feature of the OTR tyres industry is that majority of the production
(nearly 67 per cent) is exported. Last year exports saw a substantial jump of 56
per cent. The industry exported 33,530 tyres during 2002-03 as against 21,468
in the previous year. One of the main reasons for the industry's over
dependence on exports for its survival is the low domestic demand. Once the
domestic demand picks up growth in exports is expected to come down. And
this year the industry is expected to export 36,200 tyres, which is 50 per cent of
the domestic production. However, the OTR tyres industry is facing some
serious problems. The main cause of worry is rising raw material prices, mainly
natural rubber and petrochemical based raw materials. India is the third largest
producer and fourth largest consumer of natural rubber, and fifth largest
consumer of natural rubber and synthetic rubber together in the world. Natural
rubber accounts for nearly 26 per cent of the raw material cost of the industry.
Says Tom K. Thomas, "Rising price of natural rubber has affected our margins
badly. Whatever China consumes, the price of the same goes up, and whatever
China produces the price of the same goes down. Banning exports is not a
solution. We may have to increase the price of OTRs, as we are planning to do in
the near future."
Technologically, the Indian OTR tyres industry is a step behind the developed
nations. OTR radials are not yet manufactured in India. Nor do the major players
have any plans to manufacture the same in the near future. But OTR radials
have certain advantages over traditional tyres.
65
The life of OTR radials is longer than that of traditional tyres by more than 60
per cent. Also, OTR radials result in saving in consumption of fuels. OTR radials
also provide comfort to the driver thereby reducing fatigue. Industry experts
foresee good growth potential for the industry in the coming years, both in the
domestic market and export market. OTR tyre manufacturing is a labour
intensive operation and as a result its production abroad is on the decline. This
gives India good scope to expand its market abroad. Also, in the domestic
market, there is expected to be more demand for Grader and Compactor tyres
because of enhanced road construction activity in the country. "Import of tyres
from China has just started. It may pose a threat in the coming days. Quality of
the tyres is suspect but they are cheaper," Tom K. Thomas of Ceat avers. In the
coming days retreading of OTR tyres could become big business. At present, it
is dominated by a handful of players in the country. Considering its potential

many players may take the plunge in the retreading business. Manufacturers
may employ higher productivity building machines like orbitread technology for
quality enhancement. Besides, the country may start producing bigger size
tyres which were hitherto imported.
67
RESULTS AND DISCUSSIONS
Industry Overview:
During the year under review, the Tyre Industry grew by 7% in value and
approximately 9% in volume. This clearly reflects the prevailing excess capacity
situation.
The Tyre Industry continues to bear the brunt of increasing raw material
costs. Rubber imports are still controlled, resulting in high prices.
Additionally, the prices of synthetic rubber and rubber chemicals have risen
steeply in international markets. There has also been 2% increase in excise

duty, effected by the Union Budget announced in February, 2000 on all tyres,
except two wheeler and farm rear types.
Thus, while there are valid reasons for a commensurate increase in prices,
the intense competition has prevented this from happening. Margins,
therefore, are under pressure.
3. CEAT'S Performance:
The year 1999-2000 saw CEAT move out of the consolidation phase and
surge ahead with increased visibility in the market place.
Significant product quality improvements, innovative marketing strategies, a
unique supply chain management model, cost optimisation measures, and a
committed work force, all saw the Company emerge stronger inspite of this it
is the best company ever.
69
4. Manufacturing:
The capacity optimisation projects at the Mumbai and Nasik Plants are
progressing on schedule. The new radial tyre facility coming up at Nasik is
expected to be completed on time with manufacturing commencing in May-
June 2000.
The Off-take Agreement for radials and two and three wheeler tyres with
erstwhile joint venture partner, Goodyear, expires in August 2000. This may
be extended for a further period.
The expansion plan at CEAT's associated company, Rado Tyres Ltd, located in
Kerala, has been implemented. This will enhance the conversion capacity of
two and three wheeler tyres to 70000 tyres per month.
The Indian tyre industry caters to all segments of the market i.e.
OEM
Replacement
STU
Defence
Exports
The total size of domestic market (4 wheeler tyres) can be estimated around
19.4mn tyres/annum for the FY03 and is expected to go up to 28.4mn
tyres/annum by FY08. In addition, the tyre industry exports Rs13bn of tyres
across 6 continents and over 60 countries.

71
What is the USP of the Company?
Continuous innovation and state of the art technology backed by quality is
the mantra of success at JK Tyre and this has given us a clear competitive
edge over our competitors.
JK Tyre, Pioneered the Radial revolution in India two decades ago and ever
since then we have been riding the technology ladder. We offer the entire
range of 4 wheeler radials i.e. Truck & Bus, LCV, Car, Jeep and Farm. We
launched Indias first eco-friendly range of colored radials and are set to
drive the second green revolution with the launch of the tractor radial.
Globally radialization in the truck and bus segment is over 60%. Envisioning
the need for products to cater to changing freight & passenger movement
patters on superior vehicles running on the fast improving road
infrastructure, JK Tyre pioneered the introduction of truck and bus all steel
Radial tyres in India for the first time. The company has deployed significant
resources in the developing the market and educating the customer on the
value proposition of truck and bus radial tyres. Backed by an all India service
network along the national highways, JK Tyre is all set to drive yet another
radial revolution in the country.
Hari Shankar Singhania Elastomer and Tyre Research Institute (HASETRI) is
our in-house R&D center and is one of its kind in Asia. Today HASETRI act as
a nerve center - understand/determine consumer needs, develop and
provide suitable products of world-class quality to the Indian consumer as
well as continuously gauge their performance. This facility is involved in
various collaboration projects with leading research agencies both in India
and abroad. HASETRI is presently engaged in FEA and NDT studies with IIT
Chennai, Elastomer studies with IIT Kharagpur and partnering IIT Delhi in the
study of textiles.
73
Who are other major players in the tyre Industry, apart from JK
Tyres? What is the share of your company in the total market share?
Apart from JK Tyre, MRF, Bridgestone, Apollo & Ceat can be categorized as other
dominant players in Indian Tyre industry, others being Goodyear and Birla. Put
together they represent around 75-80% of the Indian tyre industry.
JK Tyre V/s Competition Shares of Total 4 Wheeler Tyres
Company Share Company Share
JK Tyre 20.9% Ceat 15.9
MRF 22.3% Goodyear 9.5%
Apollo 17.4% Birla 5.6%
Bridgestone 8.5%
Source: ATMA (All 4 Wheeler Tyres) 2002-03 April - March
Who are the major user-segments and what is Companys market
share in each user segment. (CVs, Car &Utility Vehicles and Farm & 2-
3 wheelers)?
One can categorize the major user segments in 4 wheeler tyres as Commercial
Segment i.e Truck, Bus and LCV, Passenger Car Segment i.e Cars, MUVs,
Jeep and Farm Segment i.e. Tractor and ADV.
JK Tyre V/s First Top 3 Players Share Truck & Bus Segment
JK Tyre Apollo MRF
25.2% 24.8% 18.8%
JK Tyre V/s First Top 3 Players Share Passenger Line Segment
75
In terms of revenues, which segment is performing better? Which
segment is likely to drive the growth of Tyre Industry?

In term of revenue Truck and Bus segment contributes the maximum around
70%.
Further according to me, growth in commercial vehicle & passenger car
segment, production and sales, will boost up the demand and thereby continue
to drive the growth of tyre industry.
The infrastructure initiatives like Golden Quadrilateral and NE-SW corridor,
expressways will further drive the Radial revolution in India, be it Truck & Bus
Radial or Passenger car radials.
For JK Tyre the world is the stage, accordingly, it has forged long term business
partnerships with overseas players. We have established a significant presence
in China by way of outsourcing arrangements as well as participation on
manufacturing as technology partners. Today heavy-duty bias tyres are
manufactured with our Technology and JK Tyre Branding and are being
successfully marketed in the Chinese and other global markets.
Today, we export tyres to 60 countries across 6 continents and enjoy premium
brand status in highly competitive markets like the US. For being the largest
exporter of tyres from the country, JK Tyre has been awarded with Top Export
Award CAPEXIL in year FY03. We have generated revenue of Rs3.1bn (FY03)
from our export operations.

The turnover from Chinese operations will be of significant contribution in the
years to come. We expect to have an estimated turnover of around Rs4bn in
next few years.
77
What top line and bottom line growth figures are you expecting for the
coming years?
We at JK Tyre are looking for a turnover in excess of Rs50bn by FY06 and
expected to improve our bottom-line substantially in the years to come. We
aim, to be leaders in the entire range of radial tyres (Truck & Bus, LCV,
Passenger Car, Jeep & Tractor), we operate in.
Could you brief us about merger with Vikrant Tyres and synergy seen
in terms of change in capital structure, production capacity, sales and
realizations per unit?
JK Industries Ltd has metamorphosed into a mega tyre entity with the merger of
Vikrant Tyres Ltd and crossed the magic turnover figure of Rs20bn in FY03. We
are on the threshold of a new era with JK Tyre consolidating leadership status as
well embarking on the path of enhancing our global presence.
Derived Benefits
Benefits of synergy of over Rs220mn/annum accruing to one entity, JK
Industries, earlier it was shared by shareholders of respective companies.
The benefits have been realized in the areas of bulk raw material
purchases, logistics and rationalization of network & sales force.
Combined capacity of tyre stands increased from 3.5mn tyres/annum to
5.6mn tyres/annum.
The capital of the company stands revised from Rs345.6mn to Rs374.6mn
as on September30, 2003.
Earning Per Share of the restructured entity has substantially increased
and the market price of the share, which was Rs20-25 per share before
the restructuring, is now being traded at significantly higher prices of over
Rs75/share.
79
Technology & R&D
Full Range of products
Focused and targeted marketed segmentation
Common strengths of both the brands to be leveraged

Can you brief us about your regional presence? What are the
Companys plans in order to expand and maximize its geographical
reach?
Today we are exporting to 60 countries across 6 continents. We have a
significant presence in Middle East and a strong presence is South-East
Asia, including China, where in we have strategic alliances for both
outsourcing as well as sale of JK Branded tyres in Chinese markets.
W.r.t. expanding and maximizing our geographical reach, though, we are
the largest exporter from India into Americas & Australia, we are in the
process of further developing these markets to cater to the still untapped
potential.
Anything which you like to share with us?
JK Tyre is the first to introduce Truck & Bus Radials in India
is 6 years ahead of the next likely entrant
Selling 0.2mn tyres per annum
Exporting Truck Radial Tyres worth Rs1bn
81
FUTURE SCOPE OF CEAT TYRES

Demand for tyres is derived from demand for automobiles. Therefore it is a
derived demand product and its fortunes are very closely linked to those of the
auto segment. Within the tyre industry the trucks and buses (T&B) segment
accounts for more than 70% of sales. Though scooters and motorcycle tyre
demand also plays a vital role, in value terms, CVs gain significance.
Tyre varieties can be divided into two categories cross ply and radial. The
domestic industry is dominated by cross-ply tyres, due to the poor conditions of
roads in the country and overloading of CVs. This is also the reason why
penetration of radial tyres in the CV segment is negligible and finds presence
only in the passenger car segment. On the other hand, radial tyres dominate
western markets. Radial tyres can be differentiated on the type of belt used
fiberglass, steel and nylon. Worldwide, steel belted radials are more popular due
to their performance advantage.
There are three major consumer segments for tyres namely replacement
segment, Original Equipment Manufacturers (OEMs) and exports. Though
fortunes of the sector are closely tied with the automobile industry, replacement
demand continues to remain the key growth driver. Replacement demand
accounts for as high as 57% of industry volumes. However, the contribution
from OEM and replacement segments varies across sub-segments in the auto
sector. For instance, for the passenger car segment, demand is balanced from
replacement and OEM categories i.e. 50:50.

83
Another key transition that is taking place in the industry is the entry of
multinationals like Good Year, Bridgestone and Michelin in the domestic market.
MNC tyre makers have cornered a higher market share in India in the last three
years due to their international relationships apart from superior technology.
Since Honda, Hyundai and Toyota have an international sourcing agreement
with Bridgestone, it is also the preferred supplier in India. Goodyear is believed
to be the preferred supplier for Ford India.
An extensive distribution network and strong brand recall are factors critical to
tyre sales. Brand building is given a lot of importance by manufacturers, who
allot 2-3% of sales to advertising. With the introduction of radial tyres, even
technology has assumed significance. All foreign cars introduced in the country
are on radial tyres.
Raw materials constitute 60%-70% of production cost of tyres. Natural rubber
and Nylon cord fabrics are the most critical raw materials as it accounts for 50%
of it..
NEW LAUNCHES OF CEAT TYRES
CEAT slashes prices of truck, bus tyres
CEAT-Kelani Associated Holdings (Pvt) Ltd., the leading tyre manufacturer in Sri
Lanka has announced a major reduction in the retail prices of lighttruck, truck
and bus tyres.

"Effective December 10, 2001 this reduction would make CEAT the most
affordable tyre when compared to all international brands sold in the local
market, the company's General Manager (Sales & Marketing) Ashwin Padukone
said.
85
"In a market battered by the economic downturn, the ability of the customer to
buy new tyres at the correct time has dwindled. As a result many vehicles are
seen on the road with bald tyres, which seriously jeopardises the safety of the
customers and their vehicles." Mr. Padukone said - "Using new tyres on the front
wheel, has been established as the safest and the recommended option for
safety reasons. We anticipate that this price reduction will encourage
consumers to replace with new tyres at the right time," he said.
The anticipated benefit of the increase in offtake and the consequent capacity
utilization, has been factored into the price reduction and has been passed onto
the consumers, Mr. Padukone added. CEAT-Kelani Associated Holdings (Pvt) Ltd.,
a joint venture company established in 1999, represents the strategic alliance
between Kelani Tyres Ltd., AMW Group, NDB and CEAT Ltd. of India. The holding
company has two manufacturing arms, one in Kalutara and the other at
Kelaniya.
COLLABORATIONS
A high percentage of fibre glass produced in the world is used for re
inforcement of plastics The main products maiketed by the fibre glass plants are
Mats, Rovings, Woven Rovings, Yarns etc. The use of end products i.e. fibre glass
reinforced plastics are mostly in pipes and tanks, boats transport sector,
furniture, crash helmets etc The formulation chosen for continuous fibre glass
production is generally known as E-glass. This has become standard the world
over as it performs well in practice and is used widely. The fibre glass produced
in India is Eglass only. The process of manufacture of fibre glass consists of
several steps e.g. batch preparation, production of glass melt, glass filament
conditioning, winding, drying of glass cakes, conversion to saleable products.
87
Strengths
Weaknesses
Right products, quality and
reliability.
Not very popular in the
Superior product performance
international market
vs. competitors.
Delivery-staff need training.
Brand Image
Customer service staff need
Products have required
training.
accreditations.
Processes and systems, etc
High degree of customer
Management cover insufficient.
satisfaction.
Opportunities
Threats
Profit margins will be good.
Vulnerable to reactive attack by
Could extend to overseas.
major competitors.
Could seek better supplier
Lack of infrastructure in rural
deals.
areas could constrain
An applied research centre to
investment.
create opportunities for
High volume/low cost market is
developing techniques to
intensely competitive.
provide added-value services
SWOT ANALYSIS
Bibliography
SL. NO. BOOKS
AUTHOR
1. Marketing Management PHILIP
KOTLER
2. Marketing Management Dr.PANDAY RASTOGI

91

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ROCHAK SAXENA B.COM HON.

this, it is commissioning a new radial tyre factory in June 2000.

Tyre industry is capital intensive and as capacities come in spurts, it leads to

constant demand-supply imbalances and consequent cyclicality in prices.

costs. Profit margins are therefore thin. Production process is technology

consolidation of capacities through mergers etc. The domestic tyre industry

are in vogue. Consumption of natural rubber is, therefore, proportionately

black and hiking benchmark prices of natural rubber (25-30% of sales) in

commodities are ruling at historical lows in the global market.

sectors like power, fertilizers, pharmaceuticals, tyres, computer, telecom,

to be one of restructuring and consolidation. The group is divided into 4 broad

sign of prudence on the management.

Ceat is a manufacturing company, which produces rubber, tire, nylon fabric

established research and development center that evaluates the application

The company also provides investment financial services through Meteoric

remaining revenues come from other non-core operations.

The company is pursuing a strategic initiative of intensifying outsourcing to

marketed under the CEAT Spider Radials brand name.

Ceat Limited is a manufacturer of tires in India. Automotive tires comprise the

through Ceat Financial Services Limited, including hire purchase, office

equipment finance, container and equipment/infrastructure leasing and money

How the company grew from bottom to top

CEAT International was first established in 1924 at Turino in Italy and

manufactured cables for telephones and railways.

collaboration with the TATA Group.

company CEAT Ltd. 5

CEATs PRODUCT RANGE

Truck radial tyre section

Tyre industry is capital intensive and as capacities come in spurts, it leads to

constant demand-supply imbalances and consequent cyclicality in prices.

costs. Profit margins are therefore thin. Production process is technology

consolidation of capacities through mergers etc. The domestic tyre industry

are in vogue. Consumption of natural rubber is, therefore, proportionately

black and hiking benchmark prices of natural rubber (25-30% of sales) in

commodities are ruling at historical lows in the global market.

sectors like power, fertilizers, pharmaceuticals, tyres, computer, telecom,

strategy seems to be one of restructuring and consolidation. The group is

down this fiscal which is a sign of prudence on the management.

Indian Tyre Industry

The industry is highly capital intensive, as it requires around Rs4bn to setup a

crossply tyre plant of a capacity to manufacture 1.5mn tyres.

industry, retreading, trend in road transportation and spending on road

leading players in India.

Enjoy what you do, do your best and keep learning.

Mr. Anant Goenka

Mr. Anant Vardhan Goenka is an M.B.A from the Kellogg School of

Management and a B.SC in Economics from the Wharton School.

Mr. Goenka joined KEC International Limited (KEC) as Vice President

(Corporate) and was in charge of the telecom business, business

development in North America and Integrated planning and monitoring of

Transmission and Distribution Business. In recognition of his contribution

Director Supply Chain in-charge of manufacturing, procurement,

planning, logistics and quality department in the company.

Hindustan Unilever Limited, Accenture, Mumbai and Morgan Stanley,

Hong Kong. Mr. Goenka has a total work experience of 10 years.

Mr. Manoj Jaiswal

Chief Financial Officer

Chief Financial Officer CEAT Limited