This document contains a financial analysis report for MRF Ltd from 2009-2010. It discusses MRF's history and growth as India's leading tire maker. It provides details on the structure and trends of the Indian tire industry. It also includes a SWOT analysis and discusses MRF's strong sales growth and dividend payments. Comparative financial ratios are presented and the report recommends a stock split due to MRF's high share price.

1. FINANCIAL ANALYSIS REPORT 2009-2010 TEAM Abhishek Kumar- BLP038 Abhishek Saxena- BLP012 Kushal Prakash- BLP061 Nihar Routray- BLP022 Shankar Narayan- BLP039

2. An enterprise that started as a toy balloon maker in 1946 in South India quickly grew to become one of India's biggest and respected companies. Renowned for product superiority and innovation, MRF continues to be the leading tyre-maker in India

4. With Rs.3000 crore estimated to be the value of exports. 39 tyre companies. 60 factories located all over India. 10 major tyre companies account for 88% of the tyre business in the country.

5. About Indian Tyre Industry Facts Second largest two wheeler manufacturer in the world. Largest tractor and three wheeler manufacturer in the world. Fourth largest commercial vehicle market in the world. Eleven largest passenger car market in the world. Trends > Growth of exports of 22.30% FY 2009-10 > Commercial vehicles segment grew at 4.07% > Light commercial vehicles grew at 12.29% Growth Potential Can become world's third largest automobile market in 2030. By 2016, Automotive sector can double its percentage contribution to GDP from current level of 5% (US $50billion) to 10% (US $180billion)

7. Pricing pressure

9. Exclusive distribution network

11. Cheap Import of tyres.

12. Cynical nature of automobile industry.

14. Govtemphasis on infrastructure development.

17. Further board recommended final dividend of Rs 19/share and a special dividend of Rs 25/share on Paid-up-Equity share capital .

18. An amount of Rs 329.26 crores was recommended to be transferred to General Reserve after tax provision and proposed dividend.

19. Concern for uncertain rise of material price and price sensitive market.

20. Imbalance in duty structure of import.

21. 20% duty charges on Raw material

23. Low Interest rates

27. COMPARATIVE ANALYSIS

28. LIQUIDITY AND TURNOVER RATIOS

29. CURRENTRATIO

30. QUICKRATIO

31. DEBTORS TURNOVERRATIO

32. AVERAGE COLLECTION PERIOD

33. INVENTORY TURNOVER RATIO

34. INVENTORY HOLDING PERIOD

35. CAPITAL STRUCTURE RATIOS

36. DEBT EQUITY RATIO

37. DEBT ASSETS RATIO

38. INTEREST COVERAGE RATIO

39. FIXED CHARGES COVERAGE RATIO

40. Profit Margin Ratios

41. Gross Profit Margin Ratio (%)

42. Operating Profit Margin Ratio (%)

43. Net Profit Margin Ratio (%) Profit Margin Ratios

44. Return on Investment Ratios

45. Return On Assets (%) Profit Margin Ratios

46. Return On equity /Net worth (%) Profit Margin Ratios

47. Return on Capital Employed (%) Profit Margin Ratios

48. Valuation Ratios

49. Earnings Per Share - EPS (Rs) Profit Margin Ratios

50. Price to Earnings (P/E) Ratio Profit Margin Ratios

51. Dividend Per share (Rs) Valuation Ratios

52. Dividend yield(%) Valuation Ratios

53. Way Ahead… The automobile industry has picked up really fast this year hence boosting tyre sales. Chinese tyres have lower import duty(8-10%) thus are more in demand whereas raw material import duties(20%) are high thus having higher cost. High reserve surplus to cover fluctuation in raw material cost(70 % of total cost). Natural Rubber prices increased from Rs.132 /kg to Rs 180 /kg. MRF has invested heavily in R&D which in turn is providing higher returns . MRF has also come up with a new factory in Andhra Pradesh which is highly automated and technologically advanced.

54. Cont… Market price of share very high. Rs 9439 per share in Sept 2010 with 544616 shares traded on NSE. Recommendations Stock split up as per share market price is very high. This will increase the equity base also.

55. Q n AThank you