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CHAPTER-1

FINACIAL ANALYSIS OF MRF

MEANING AND CONCEPT OF FINANCIAL ANALYSIS

Financial analysis refers to an assessment of the viability, stability and profitability of a

business, sub-business or project.

It can also be defined as the process of identifying financial strengths and weaknesses of the firm
by properly establishing relationship between the items of the balance sheet and the profit and
loss account. It is the examination of a business from a variety of perspectives in order to fully
understand the greater financial situation and determine how best to strengthen the business and
it also looks at many aspects of a business from its profitability and stability to its solvency and
liquidity. It is a process of scanning the Financial Statements for evaluating the relationship
between the items as disclosed in them.

In other words it can be defined as an analysis which critically examines the relationship
between various elements of the Financial Statements with a view to obtain the necessary and
effective information from them.

According to John N. Myer, ‘Financial Statement Analysis is largely a study of

relationships among the various financial factors in a business, as disclosed by a single set
of statements, and study of these factors as shown in a series of statements.’

Financial Statement Analysis involves a systematic and critical examination of the information
contained in the Financial Statements with a view to provide effective and more meaningful
information to its different users. It is an exceptionally powerful tool for a variety of users of
financial statements, each having different objectives in learning about the financial
circumstances of the entity.

According to Alan S. Donnahoe - "The inability to understand and deal with financial data
is a severe handicap in the corporate world"

 Financial analysis can be applied in a wide variety of situations to give business

managers the information they need to make critical decisions."In a very real sense,
finance is the language of business. Goals are set and performance is measured in
financial terms. Plants are built, equipment ordered, and new projects undertaken based
on clear investment return criteria. Financial analysis is required in every such case."
 Financial statement analysis is an analysis that highlights the important relationship in the
financial statements. Financial statement analysis focuses on the evaluation of past
performance of the business firm in terms of liquidity, profitability, operational efficiency
and growth potentiality. Financial statements analysis includes the method use in
assessing and interpreting the result of past performance and current financial position as
they relate to particular factors of interest in investment decisions. Therefore financial
statement analysis is an important means of assessing past performance and in forecasting
and planning future performance.

It is performed by professionals who prepare reports using ratios that make use of
information taken from financial statements and other reports. These reports are usually
presented to top management as one of their bases in making business decisions, such as:
 Continuing or discontinuing the business
 Making or purchasing certain materials in the manufacture product
 Acquire or rent/lease certain machineries and equipment in the
 production of its goods Negotiating for a bank loan to increase its working capital and to
 issue the stocks Making decisions regarding investing or lending capital
 Allowing management to make an informed selection on various
alternatives in the conduct of its business

Elements of a Company Assessed by the financial analysts:

Generally financial analysts assess the following elements:

1. Profitability – It is the ability to earn income and sustain growth in both the short- and long-
term. A company's degree of profitability is usually based on the income statement, which
reports on the company's results of operations.

2. Solvency – It is the ability to pay its obligation to creditors and other third parties in the long-
term. It is also based on the company's balance sheet, which indicates the financial condition of a
business at a given point of time.
3. Liquidity – It is the ability to maintain positive cash flow, while satisfying immediate
obligations and it is also based on the company's balance sheet, which indicates the financial
condition of a business at a given point of time.

4. Stability - The firm's ability to remain in business in the long run, without having to sustain
significant losses in the conduct of its business. Assessing a company's stability requires the use
of the income statement and the balance sheet, as well as other financial and non-financial
indicators.

Financial Statement Analysis-Users

1.Creditors: Anyone who has lent funds to a company is interested in its ability to pay back
the debt, and so will focus on various cash flow measures.

2.Investors: Both current and prospective investors examine financial statements to learn about
a company's ability to continue issuing dividends, or to generate cash flow, or to continue
growing at its historical rate .

3.Management: The company controller prepares an ongoing analysis of the company's
financial results, particularly in relation to a number of operational metrics that are not seen by
outside entities

4.Regulatory authorities: If a company is publicly held, its financial statements are examined
by the Securities and Exchange Commission to 5 see if its statements conform to the various
accounting standards and the rules of the SEC.
Objectives

 Assessment of Past Performance

Past performance is a good indicator of future performance. Investors or creditors are interested
in the trend of past sales; cost of goods sold, operating expenses, net income, cash flows and
return on investment. These trends offer a means for judging management's past performance
and are possible indicators of future performance.

 Assessment of current position

Financial statement analysis shows the current position of the firm in terms of the types of assets
owned by a business firm and the different liabilities due against the enterprise.

 Prediction of profitability and growth prospects

Financial statement analysis helps in assessing and predicting the earning prospects and growth
rates in earning which are used by investors while comparing investment alternatives and other
users in judging earning potential of business enterprise.

 Assessment of the operational efficiency

Financial statement analysis helps to assess the operational efficiency of the management of a
company. The actual performance of the firm which are revealed in the financial statements can
be compared with some standards set earlier and the deviation of any between standards and
actual performance can be used as the indicator of efficiency of the management.

Some other objectives are

 Provide reliable financial information

 .Provide other needed information about changes in economic resources and obligation.
 Provide reliable information about changes in net resources.
 Provide financial information that assess in estimating the earnings of a business.
 Disclosing other information according to the needs of the users.
Types of Financial Statement Analysis:
Financial statement analysis can be performed by employing a number of methods or
techniques.
There are two key methods for analyzing financial statements:

1. Horizontal and vertical analysis:

 Horizontal analysis is the comparison of financial information over a series of
reporting periods, Horizontal analysis looks at amounts on the financial
statements over the past years. This allows you to see how each item has changed
in relationship to the changes in other items. Horizontal analysis is also referred to
as trend analysis.
 Vertical analysis is the proportional analysis of a financial statement, where each
line item on a financial statement is listed as a percentage of another item.
Typically, this means that every line item on an income statement is stated as a
percentage of gross sales, while every line item on a balance sheet is stated as a
percentage of total assets. Thus, horizontal analysis is the review of the results of
multiple time periods, while vertical analysis is the review of the proportion of
accounts to each other within a single period.
2. Ratio Analysis
The second method for analyzing financial statements is the use of many kinds of ratios.
You use ratios to calculate the relative size of one number in relation to 7 another. After
you calculate a ratio, you can then compare it to the same ratio calculated for a prior
period, or that is based on an industry average, to see if the company is performing in
accordance with expectations. In a typical financial statement analysis, most ratios will be
within expectations, while a small number will flag potential problems that will attract
the attention of the reviewer.The methods to be selected for the analysis depend upon the
circumstances and the users' need. The user or the analyst should use appropriate
methods to derive required information to fulfill their needs.
 Advantages of Ratio Analysis :
Financial statements i.e., Profit and Loss account and Balance Sheet prepared at the end
of the year do not always convey to the reader the real profitability and financial health of
the business. They contain various facts and figures and it is for the reader to conclude,
whether these facts indicate a good or bad managerial performance. Ratio analysis is the
most important tool of analysing these financial statements. It helps the reader in giving
tongue to the mute heaps of figures given in financial statements. The figures then speak
of liquidity, solvency, profitability etc. of the business enterprise. Some important objects
and advantages derived by a firm by the use of accounting ratios are:

1. Helpful in Analysis of Financial Statements:- Ratio analysis is an extremely device for

analyzing the financial statements. It helps the bankers, creditors, investors, shareholders
etc. in acquiring enough knowledge about the profitability and financial health of the
business. In the light of the knowledge so acquired by them, they can take necessary
decisions about their relationships with the concern.
2. Simplification of Accounting Data:- Accounting ratio simplifies and summarises a long
array of accounting data and makes them understandable. It discloses the relationship
between two such figures, which have a cause and effect relationship with each other.
3. Helpful in comparative study:- With the help of ratio analysis comparison of
profitability and financial soundness can be made between one firm and another in the
same industry. Similarly, comparison of current year figures can also be made with those
of previous years with the help of ratio analysis.
4. Helpful in locating the weak spots of the business:- Current year’s ratios are compared
with those of the previous years and if some weak spots are thus located, remedial
measures are taken to correct them.
5. Helpful in forecasting:- Accounting ratios are very helpful in forecasting and the plans
for the future.
6. Estimate about the trend of the business:- If accounting ratios are prepared for a
number of years, they will reveal the trend of costs, sales, profits and other important
facts.
 7. Fixation of Ideal Standards:- Ratios helps us in establishing ideal standards of the
different item of the business. By comparing the actual ratios calculated at the end of the
year with the ideal ratios, the efficiency of the business can be easily measured.

Limitations of Ratio Analysis

Ratio analysis is a very important tool of financial analysis. But despite it’s being indispensable,
the ratio analysis suffers from a number of limitations. These limitations should be kept in mind
while making use of the ratio analysis:-

1. False accounting data gives false ratios:- Accounting ratios are calculated on the basis
of given data given in profit and loss account and balance sheet. Therefore, they will be
only as correct as the accounting data on which they are based. For example, if the
closing stock is over-valued, not only the profitability will be overstated but also the
financial position will appear to be better. Therefore, unless the profit and loss account
and balance sheet are reliable, the ratios based on them will not be reliable. There are
certain limitations of financial statements as such, the ratios calculated on the basis of
such financial statements will also have the same limitations.
2. Comparison not possible if different firms adopt different accounting policies:-
There may be different accounting policies adopted by different firms with regard to
providing depreciation, creation of provision for doubtful debts, method of valuation of
closing stock etc. For instance, one firm may adopt the policy of charging depreciation on
straight-Line basis, while other may charge on written-down value method. Such
differences make the accounting ratios incomparable.
3. Ratio analysis becomes less effective due to price level changes:- Price level over the
year goes on changing, therefore, the ratios of various years can not be compared. For
e.g., one firm sells 1,000 machines for Rs 10 lacs during 1992, it again sells 1,000
machines of the same type in year 1993 but owing to rising prices the sale price was Rs
15 lacs. On the basis of ratios it will be concluded that the sales have increased by 50 %
whereas in actual, sales have not increased at all. Hence, the figures of the past years
must be adjusted in the light of price level changes before the ratios for the years are
compared.
4. Ratios may be misleading in the absence of absolute data:- For example, X company
produces 10 Lakh metres of cloth in 1992 and 15 Lakh metre in 1993, the progress is
50%. Y Company raises its production from 10 thousand metres in 1992 to 20 thousand
metres in 1993, the progress is 100%, and comparison of these two firms made on the
basis of ratio will disclose that the second firm is more active than the first firm. Such
conclusion is quite misleading because of the difference in the size of the two firms. It is,
therefore, essential to study the ratios along with the absolute data on which they are
based.
5. Limited use of a Single Ratio:- The analyst should not merely rely on a single ratio. He
should study several connected ratios before reaching a conclusion. For example, the
Current Ratio of a firm may be quite satisfactory, whereas the Quick Ratio may be
unsatisfactory.
6. Window Dressing:- Some companies in order to cover up their bad financial position
resort to window dressing i.e., showing a better position than the one, which really exists.
They change their balance sheet in such away that the important facts and truth may be
concealed.
7. Lack of proper standards:- Circumstances differ from firm to firm hence no single
standard ratio can be fixed for all the firms against which the actual ratio may be
compared.
8. Ratios alone are not adequate for proper conclusions:- Ratios derived from analysis of
statements are not sure indicators of good or bad financial position and profitability of a
firm. They merely indicate the probability of favorable or unfavorable position. The
analyst has to carry out further investigations and exercise his judgment in arriving at a
correct diagnosis.
9. Effect of personal ability and bias of analyst:- Another important point to keep in mind
is that different persons draw different meaning of different terms. One analyst may
calculate ratios on the basis of profit after interest and tax, whereas another analyst may
consider profits before interest and tax; a third may consider profits after interest but
before tax. Therefore, before making comparisons, one must be sure that the ratios have
been calculated on the same basis. Although ratio analysis suffers from a number of
limitations as enumerated above, yet it is a very useful and widely used tool of analyzing
 the financial statements. Useful conclusions may be arrived at by ratio analysis provided
the above-mentioned limitations are kept in mind while using the results obtained from
ratio analysis.

RATIOS IN DETAIL

We shall now look At some of the ratios in detail explain how they can be
interpreted.
It is possible to look at the financial health of a corporation by looking at some of its key
financial ratios. Ratio analysis can also be used as a diagnostic tool to find the sources of
financial trouble at a company.

The ratios may be divided into these types:

Liquidity ratios, that look at the availability of cash for operations.

2. Asset management ratios evaluate the efficient utilization of the resources.

3. Debt management ratios keep track of debt to be within reasonable bounds, and keep the
debt level at its optimal level.

4. Profitability ratios measure the degree of accounting profits.

5. Market value ratios help investors discriminate between overvalued and undervalued
securitie while making investment decisions.

1.Liquidity Ratios:

First we look at the liquidity ratios of a company. These ratios focus on the availability of cash to
manage the day to day operations of the company. In particular, we define the current ratio as

Current ratio = Total current assets / Total current liabilities

The current ratio of a company gives us a quick way to look at its current assets and current
liabilities. They should be nearly equal to one another. Next, we look at a more stringent ratio
that gives us the cash position of the firm more accurately by removing the value of the
inventories from the current assets. This gives us the quick ratio, or the acid test ratio, as follows:

Quick, or Acid Test = Current assets – inventories / Current liabilities

2.Asset Management Ratios:

The asset management ratios evaluate the efficiency of use of the principal assets of a company,
such as its inventory.

Inventory Turnover = Cost of goods sold / Inventories (average)

This ratio measures the efficient use of inventories. A firm should have a high turnover ratio,
which is managed through a small amount of inventories. This means that a firm should have a
small inventory and try to sell it as quickly as possible. Unfortunately, a small inventory also
means lower sales. Closely related to the inventory management is the management of
receivables. A company should have a small amount invested in the receivables. That is, the
company should try to sell the goods for cash. To measure the efficiency of this operation, we
define the Days Sales Outstanding as

Days sales outstanding = Receivables / Sales per day

A broader measure of the efficiency of use of assets is the fixed assets turnover. This ratio is
defined as follows.

Total assets turnover = Annual sales / Total assets (average)

This ratio looks at the aggregate assets of a company and measures the way the company utilizes
them.

3.Debt Management Ratios:

The corporations borrow money to do their business because debt capital is cheaper than the
equity capital. On the other hand, excessive amount of debt can create problems for the
company. To see the debt level of a company, we define its debt ratio, or leverage ratio as
follows

Debt ratio = Total debt / Total assets

Of course, the companies must maintain their debt at an optimal level. Another ratio that looks at
the ability of a company to pay its interest when due is its interest coverage ratio, or times
interest earned This is defined as :

Interest coverage = charges EBIT / Interest

4.Profitability Ratios:

The next set of ratios measure the ability of a company to generate profits. These ratios are of
interest to investors who would like to invest in the most profitable companies around. The first
ratio is the net profit margin, defined as:

Net profit margin = Net income Total / operating revenue

In this ratio, net income is defined to be the income after taxes, available to the stockholders of
the company.

The next ratio looks at the profitability from the point of view of the management of a firm. In
this case the denominator is EBIT, meaning earnings before interest and taxes. If the EBIT is too
small, then the financial managers at a corporation will have difficulty in paying the interest on
time. We define gross profit margin as follows:

Gross profit margin = EBIT Total / operating revenue

Another ratio that the investors like to review is net return on assets. We may define it as;

Net return on assets = Net income / Total average assets

The similar ratio that the management wants to review is gross return on assets, defined as
follows

Gross return on assets = EBIT Total / average assets

The stockholders are particularly interested in the following three ratios. First, return on common
equity, that measures the return to the stockholders on stockholders' investment in the company.
This is defined as:

Return on common equity = Net income to stockholders / Average common equity

Second, is the dividend payout ratio This represents the fraction of money paid to the
stockholders out of the income after taxed. We may define it as

Dividend payout ratio = Total cash dividends / Net income

The dividend payout ratio is important to the management as well. They cannot afford to pay
large dividends when the company needs the money to finance new profitable projects. The
growth of a company depends upon the retention rate, that is, the money that is not paid out as
dividends. So, we define the third quantity, the sustainable growth rate as:

Sustainable growth rate = ROE  Retention ratio

Where ROE stands for the return on equity for a firm

5. Market Value:

From an investor's point of view, it is important to see the difference between the market value
of the stock of a company, and its accounting value, or book value. To get a perspective on this
difference, we define the Market/Book ratio as:

Market/Book ratio = Market price (/share) / Book value(/share)

The investors hunting for bargains like to see this ratio as small as possible We complete our list
by including two more ratios, defined as follows:

P-E ratio = Market price (/share) / Earnings(/share)

Importance of Financial Statement Analysis:
The financial statement analysis is important for different reasons, they are as follows:

1. Holding of Share

Shareholders are the owners of the company. They may have to take decisions whether they have
to continue with the holdings of the company's share or sell them out. The financial statement
analysis is important as it provides meaningful information to the shareholders in taking such
decisions.

2. Decisions and Plans

The management of the company is responsible for taking decisions and formulating plans and
policies for the future. They, therefore, always need to evaluate its performance and effectiveness
of their action to realize the company's goal in the past. For that purpose, financial statement
analysis is important to the company's management.

3. Extension of Credit

The creditors are the providers of loan capital to the company. Therefore they may have to take
decisions as to whether they have to extend their loans to the company and demand for higher
interest rates. The financial statement analysis provides important information to them for their
purpose.

4. Investment Decision

The prospective investors are those who have surplus capital to invest in some profitable
opportunities. Therefore, they often have to decide whether to invest their capital in the
company's share. The financial statement analysis is important to them because they can obtain
useful information for their investment decision making purpose.
Problems with Financial Statement Analysis:

While financial statement analysis is an excellent tool, there are several issues to be aware of that
can interfere with your interpretation of the analysis results. These issues are:

1. Comparability between periods:

The Company preparing the financial statements may have changed the accounts in which it
stores financial information, so that results may differ from period to period. For example, an
expense may appear in the cost of goods sold in one period, and in administrative expenses in
another period. Comparability between companies:

2. An analyst frequently compares:

the financial ratios of different companies in order to see how they match up against each other.
However, each company may aggregate financial information differently, so that the results of
their ratios are not really comparable. This can lead an analyst to draw incorrect conclusions
about the results of a company in comparison to its competitors.

3.Operational information:

Financial analysis only reviews a company's financial information, not its operational
information, so you cannot see a variety of key indicators of future performance, such as the size
of the order backlog, or changes in warranty claims.

Limitations of Financial Statement Analysis

Although analysis of financial statement is essential to obtain relevant information for making
several decisions and formulating corporate plans and policies, it should be carefully performed
as it suffers from a number of the following limitation.

1. Mislead the user

The accuracy of financial information largely depends on how accurately financial statements are
prepared. If their preparation is wrong, the information obtained from their analysis will also be
wrong which may mislead the user in making decisions.
2. Not useful for planning

Since financial statements are prepared by using historical financial data, therefore, the
information derived from such statements may not be effective in corporate planning, if the
previous situation does not prevail.

3. Qualitative aspects

Then financial statement analysis provides only quantitative information about the company's
financial affairs. However, it fails to provide qualitative information such as management labor
relation, customer's satisfaction, and management’s skills and so on which are also equally
important for decision making.

4. Comparison not possible

The financial statements are based on historical data. Therefore comparative analysis of financial
statements of different years cannot be done as inflation distorts the view presented by the
statements of different years.

5. Wrong judgment

The skills used in the analysis without adequate knowledge of the subject matter may lead to
negative direction. Similarly, biased attitude of the analyst may also lead to wrong judgement
and conclusion. The limitations mentioned above about financial statement analysis make it clear
that the analysis is a means to an end and not an end to itself. The users and analysts must
understand the limitations before analyzing the financial statements of the company. Thus,
financial analysis only presents part of the total picture.
 CHAPTER- 2

PROFILE OF THE COMPANY

THE INDIAN TYRE INDUSTRY

Foreign companies dominate the Indian tyre industry in 1960 however in the latter part of sixties
and early seventies the Indian industry entrepreneurs stylish enter into market alongside
collaboration with the automobile sector Foundation with in the country. The tire industry say
the enter of player and with the wind and Liberation bollowing a mdits Hue and cry. swept entry
land in 1992 and what about the role of joint venture with in industry.

.Ever since the first Indian tyre company doing pole rubber company Indian was incorporated in
1926 that I industry has grow rapidly and today it is an 9000 crore industry the Indian tyre
industry produce the complete range of tyre required by the Indian automotive industry,

Expect for Aero tire and specialized tyres domestic manufacturer produced for drunk buses
passenger cards apply truck tractor front and rear animal ground vehicle scooter motorcycle
mopeds and bicycle and of the road vehicle and special defense vehicle.

The Indian has 2.61 lakh will is connected by 6.23 lakh kms to metal lead roads and 9.81 lakhs
of unmetalled road. These is villages are linked to a small town and cities there exist a West
potential for the tyre industry in India. The fortune of the tyre industry depend on the agriculture
and industrial performance of the economy that transportation needs and the production of fickle
hence this is a very sensitive industry which has to adapt itself to a highly volatile environment.

While that tire industry is mainly dominated by the organized sector the unorganized sector hold
away in Bicycle tyre the major players in the organized tyre segment consists of MRF tyre,
Apollo Tyres, ceat, and Jk industry which account for 63% of the organized tyre market. The
Other key player include Modi Rubber Kesoram Industry and goodyear India with 11% 7% and
6% representative Dunlop Felkon ,layer Corporation of India Limited TVS Srichakra, Metro
Tyre air and Balkrishna Tyre and some of the Other players in the industry
THE INDIAN TYRE INDUSTRY EVOLVES ITS SELF AROUND SOME SILENT
FEATURE LIKE.

 Adaptability
 Innovation
 Export
 Technology Progression
 Wide Product range for divers usage

The Original Indian tyre market can be categorize into three. They are:

 Equipment market
 Replacement market
 Export market
Madras Rubber Factory Limited, commonly known by the abbreviation MRF, is an
Indian multinational and the largest manufacturer of tyres in India and the fourteenth largest
manufacturer in the world. It is headquartered in Chennai, India.

The company manufactures rubber products including tyres, treads, tubes and conveyor belts,
paints and toys.MRF also runs the MRF Pace Foundation, Chennai and MRF Challenge in
motorsport.

The company collaborated with Hasbro International United States, the world's largest toy maker
and launched Funskool India. Also, they entered into a pact with Vapocure of Australia to
manufacture polyurethane paint formulations and with Italian tyre manufacturer Pirelli for
conveyor and elevator belt manufacture. During the year 2004-05,

The product range of the company expanded with Go-kart & rally tyres and tyres for two/three
wheelers.

In 1973, MRF started manufacturing Nylon tyres for the first time. The Company entered into
with a technical know-how collaboration with B.FGoodrich in 1978.

The Mansfield Tire & Rubber Co sold out its share in 1979 and the name of the company was
changed to MRF Ltd in the year.
Type Public

Traded as BSE: 500290

NSE: MRF

ISIN INE883A01011

 Tyres
Industry
 Rubber products
Founded Tiruvottiyur, Madras, Tamil Nadu,
India (1946; 72 years ago)
Founder K. M. Mammen Mappillai
Headquarters Chennai, Tamilnadu, India
Key people Late K.M.Mammen (Chairman &
MD)
Products  Tyres
 Toys
 Sports equipment
 Conveyor belt
 Paints
 Coats
Revenue ₹22,683.87
crore(US$3.2 billion) (2017)
Operating ₹18,482.15
income crore(US$2.6 billion) (2017)
Net income ₹802.21
crore(US$110 million) (2017)
Total assets ₹9,978.98
crore(US$1.4 billion) (2017)
Total equity ₹5,675.72
 crore(US$790 million) (2017)
Number of 16,194 (2017)
employees
Website www.mrftyres.com
HISTORY

Madras Rubber Factory was started by K. M. Mammen Mappillai as a toy balloon manufacturing
unit in 1946 at Tiruvottiyur, Madras(now Chennai). In 1952, the company ventured into the
manufacture of tread rubber. Madras Rubber Factory limited was incorporated as a private
company in November 1960 and ventured into manufacture of tyres in partnership
with Mansfield Tire & Rubber company based in Ohio, United States.

The company went public on 1 April 1961 and an office was established in Beirut, Lebanon to
develop the export market in 1964 and its current logo of the muscleman was born. In 1967, it
became the first Indian company to export tyres to USA.

In 1973, MRF started manufacturing Nylon tyres for the first time. The Company entered into
with a technical know-how collaboration with B.FGoodrich in 1978. The Mansfield Tire &
Rubber Co sold out its share in 1979 and the name of the company was changed to MRF Ltd in
the year.

The company finalized a technical collaboration agreement with Marangoni TRS SPA, Italy for
the manufacture of pre-cured tread rubber for retreading industry. MRF tyres supplied tyres
to Maruti 800, India's first modern small car. In 1989,The company collaborated with Hasbro
International United States, the world's largest toy maker and launched Funskool India. Also,
they entered into a pact with Vapocure of Australia to manufacture polyurethane paint
formulations and with Italian tyre manufacturer Pirelli for conveyor and elevator belt
manufacture. During the year 2004-05,

The product range of the company expanded with Go-kart & rally tyres and tyres for two/three
wheelers
 MANAGMENT

Name Designation

Ambika Mammen Director

Arun Mammen Vice Chairman &
Mng.Director

Ashok Jacob Director

Cibi Mammen Director
Jacob Kurian Director
K C Mammen Director
K M Mammen CEO
K M Mammen Chairman & Managing
Director

Madhu P Nainan Vice President - Finance

Meyyappan Director
N Kumar Director
Rahul Mammen Mappillai Whole Time Director

Ranjit I Jesudasen Director

S Dhanvanth Kumar Co. Secretary & Compl. Officer

S Dhanvanth Kumar Secretary

Salim Joseph Thomas Director
Samir Thariyan Mappillai Whole Time Director

V Sridhar Director
Varun Mammen Whole Time Director
PRODUCTS

 Tyres tyre manufactures various tyres for passenger cars, two–wheelers, trucks, buses,
tractors, light commercial vehicles and off–the–road tyres.The major products include MRF
Nylogrip for bikes, MRF ZVTs and MRF Wanderers for cars and SUVs, MRF Meteor all
terrain tyres, MRF Steel Muscle for trucks and buses.
 Conveyor Belting – manufactures its in-house brand of Muscleflex conveyor belts.
 Pretreads – MRF has the most advanced pre-cured retreading system in India. MRF forayed
into retreading in 1970 and manufactures pretreads for tyres.
 Paints - manufactures polyurethane paint formulations and coats used in automotive,
decorative and industrial applications.
 Cricket - MRF manufactures cricket bats, gloves, pads and other accessories.

SEARVICE

 T&C
 TIRETOK
 TYREDROME
 MRF FASST
 MUSCLE ZONE
 MIDD

MANUFACTURING FACILITIES
The company has manufacturing facilities for tyres
at Kottayam in Kerala, Puduchery, Arakonam, Goa and trichy two plants in Perambalur in Tamil
Nadu, Medak and ankenpally in Telangana has two facilities one recently opened. The company
manufactures toys at its facility in Goa. The paints and coats are manufactured at two facilities
in Chennai, Tamil Nadu.
Endorsement
MRF had been the bat sponsor for many cricketers of the game. Sachin Tendulkar, Brian
Lara and Steve Waugh have endorsed MRF products. MRF has also sponsored Indian
batsmen Rohit Sharma, Gautam Gambhir and Sanju Samson. Currently MRF is endorsed by star
batsmen Shikhar Dhawan, Virat Kohli and AB de Villiers.

PERVIOUS ENDORSMENT

 Sachin Tendulkar – Genius

 Brian Lara – Wizard, Wizard 400
 Steve Waugh – Conqueror
 Rohit Sharma – Genius
 Gautam Gambhir – Genius
 Sanju Samson – Wizard

CURRENT ENDORSMENT

 Shikhar Dhawan – Genius SD 25 / Unique SD

 Virat Kohli – Genius VK 18
 AB de Villiers – Genius ABD 25
 Prithvi Shaw – Emerging Star
At IPL 2010, MRF sponsored moored balloons floating above the cricket grounds with a high-
definition camera recording live actions of the cricket match. MRF joined as a global partner
of International Cricket Council for 2015 Cricket World Cup. In 2017, MRF became the sleeve
sponser for the Premier League clubs Newcastle United, West Ham United F.C. and official tyre
partner for West Bromwich Albion.
 FIVE YEARS FINANCIAL SUMMARY

RS. In 2017 2015- 2014 2013 2012

(crore 16
)
Sales 14651. 22030. 14640. 13444. 13054.
24 91 94 75 03
Other 426.77 452.30 73.47 37.40 39.73
Incom
e
Total 15078. 22483. 14714. 13482. 13093.
Incom 01 21 41 15 76
e
Profit 2066.3 3605.9 1338.8 1226.8 833.12
Before 7 5 9 0
Taxati
on
Provisi 615.29 1132.0 441.00 424.59 260.76
on for 5
Taxati
on
Profit 1451.0 2473.9 897.89 802.21 572.36
after 8 0
Taxati
on
Share 4.24 4.24 4.24 4.24 4.24
Capital

Reserv 8540.1 7156.9 4513.4 3640.9 2853.5

es 8 7 0 0 6
Net 8544.4 7161.2 4517.6 3645.1 2857.8
Worth 2 1 4 4 0
Fix.AS 7560.0 6306.5 6954.4 5834.1 5477.1
S.(G) 9 6* 3 4 6
 RS. In (crore) 2017 2015-16

Sales 14651.24 22030.91

Other Income 426.77 452.3

Total Income 15078.01 22483.21

Profit Before Taxation 2066.37

3605.95
Provision for Taxation 615.29
1132.05
Profit after Taxation 1451.08
2473.9
Share Capital 4.24 4.24

Reserves 8540.18 7156.97

Five year financial summary

FINANCIALS OF SUBSIDIARY COMPANIES

 MRF Corp Ltd - F Y ended 31.03.2016

 MRF International Ltd - F Y ended 31.03.2016
 MRF Lanka (P) Ltd - F Y ended 31.03.2016
 MRF SG Pvt. Ltd - F Y ended 31.03.2016
 MRF Corp Ltd - F Y ended 31.03.2017
 MRF International Ltd - F Y ended 31.03.2017
 MRF Lanka (P) Ltd - F Y ended 31.03.2017
 MRF SG Pvt. Ltd - F Y ended 31.03.2017
 MRF Corp Ltd - F Y ended 31.03.2018
 MRF International Ltd - F Y ended 31.03.2018
 MRF Lanka (P) Ltd - F Y ended 31.03.2018
 MRF SG Pvt. Ltd - F Y ended 31.03.2018
COMPITITION

Name Last Price Market Cap. Sales Net Profit Total Assets
(Rs. cr.) Turnover

MRF 63,978.35 27,134.13 14,821.92 1,092.28 11,151.90

Balkrishna Ind 1,054.75 20,390.13 4,464.46 739.25 4,713.80

Apollo Tyres 217.05 12,416.34 10,299.70 622.39 9,772.41

Ceat 1,097.30 4,438.59 6,161.34 278.72 2,962.76

JK Tyre & Ind 95.35 2,162.67 6,453.35 43.09 4,624.42

TVS Srichakra 2,362.80 1,809.21 2,152.25 117.61 955.13

PTL Enterprises 42.75 282.96 60.26 45.83 472.04

Elgi Rubber 28.05 140.39 185.89 1.93 374.88

 MRF
Balkrishna Ind
Apollo Tyres
Ceat
JK Tyre & Ind
TVS Srichakra
PTL Enterprises
Elgi Rubber

In 2002 MRF Tyres Ltd sees slump in commercial vehicle tyre market and passenger car growth
has also declined. High court dismisses the writ petition filed by MRF Employees Union
challenging the order of dismissal of a worker, who was the secretary of the union. Advertising
Standard Council of India Quashed the objection raised by MRF by upholding J K Industries
claim of being India’s Number one tyre maker in the four-wheeler segment. MRF Tyres is the
biggest consumer of natural rubber in India during 2002-03 .Ties up with Maruti Udyog to boost
motorsports in India .1n 2007 MRF Ltd launches premium truck tyre Super Lug 50-FS. In 2011
MRF Ltd inaugurated its 7th manufacturing facility at Ankanpally near Hyderabad, exclusively
for radial tyres. MRF Ltd crosses gross revenue mark of Rs 10,000 crores.
Kye Financial Mar '18 Mar '17 Mar '16 Sep '14 Sep '13
Ration of MRF
Face Value 10.00 10.00 10.00 10.00 10.00
Dividend Per 60.00 60.00 100.00 50.00 30.00
Share
Operating Profit 5,352.19 6,097.46 10,291.99 4,545.80 4,165.48
Per Share (Rs)
Net Operating 34,947.94 31,231.70 46,891.23 31,117.98 28,603.52
Profit Per Share
(Rs)
Free Reserves -- -- -- -- --
Per Share (Rs)
Bonus in Equity 41.98 41.98 41.98 41.98 41.98
Capital
Profitability Ratios
Operating Profit 15.31 19.52 21.94 14.60 14.56
Margin(%)
Profit Before 10.35 14.55 17.96 11.34 11.46
Interest And
Tax Margin(%)
Gross Profit 10.55 14.92 18.25 11.40 11.48
Margin(%)
Cash Profit 11.90 15.17 15.87 9.95 9.66
Margin(%)
Adjusted Cash 11.90 15.17 15.87 9.95 9.66
Margin(%)
Net Profit 7.36 10.95 12.43 6.80 6.61
Margin(%)
Adjusted Net 7.23 10.68 12.24 6.76 6.59
Profit
Margin(%)
Return On 16.56 22.32 43.25 24.79 28.04
Capital
Employed(%)
Return On Net 11.37 16.98 34.54 19.87 22.00
Worth(%)
Adjusted Return 11.37 16.98 34.54 19.87 22.00
on Net
Worth(%)
Return on 22,645.31 20,146.50 16,885.09 10,651.94 8,594.71
Assets
Excluding
Revaluations
Return on 22,645.31 20,146.50 16,885.09 10,651.94 8,594.71
Assets Including
Revaluations
Return on Long 16.90 23.63 45.69 27.47 30.94
Term Funds(%)
Liquidity And Solvency
Ratios
Current Ratio 0.89 0.91 0.87 0.99 0.99
Quick Ratio 0.55 0.61 0.62 0.82 0.70
Debt Equity 0.16 0.21 0.28 0.40 0.39
Ratio
Long Term Debt 0.14 0.14 0.21 0.27 0.26
Equity Ratio
Debt Coverage Ratios
Interest Cover 7.53 9.42 11.44 6.78 7.26
Total Debt to 0.16 0.21 0.28 0.40 0.39
Owners Fund
Financial 10.41 11.90 13.57 8.61 9.16
Charges
Coverage Ratio
Financial 8.33 9.39 10.29 6.70 7.00
Charges
Coverage Ratio
Post Tax
Management Efficiency
Ratios
Inventory 7.01 6.16 11.79 7.33 6.76
Turnover Ratio
Debtors 7.24 6.99 11.24 8.09 8.06
Turnover Ratio
Investments 7.01 6.16 11.79 7.33 6.76
Turnover Ratio
Fixed Assets 1.87 1.98 3.80 2.09 2.22
Turnover Ratio
Total Assets 1.33 1.28 2.18 2.09 2.39
Turnover Ratio
Asset Turnover 1.38 1.36 2.57 2.31 2.54
Ratio
Average Raw -- -- -- -- --
Material
Holding
Average -- -- -- -- --
Finished Goods
Held
Number of Days -1.64 15.62 2.19 37.27 30.19
In Working
Capital
Profit & Loss Account
Ratios
Material Cost 62.77 60.57 58.63 65.42 67.08
Composition
Imported 34.62 41.07 47.81 45.89 42.95
Composition of
Raw Materials
Consumed
Selling 1.75 1.93 1.79 -- --
Distribution
Cost
Composition
Expenses as 7.82 8.81 8.49 9.35 10.16
Composition of
Total Sales
Cash Flow Indicator Ratios
Dividend Payout 2.32 2.92 0.85 2.36 1.58
Ratio Net Profit
Dividend Payout 1.41 2.05 0.66 1.60 1.08
Ratio Cash
Profit
Earning 97.68 97.08 99.15 97.64 98.42
Retention Ratio
Cash Earning 98.59 97.95 99.34 98.40 98.92
Retention Ratio
AdjustedCash 0.86 0.88 0.62 1.37 1.22
Flow Times
BALANCE SHEET OF MRF TYRE

Parameter MAR'18 MAR'17

(₹ Cr.) (₹ Cr.)
EQUITY AND LIABILITIES
Share Capital 4.24 4.24
Share Warrants & Outstandings
Total Reserves 9,599.96 8,540.18
Shareholder's Funds 9,604.20 8,544.42
Long-Term Borrowings 0.00 0.00
Secured Loans 500.00 500.00
Unsecured Loans 819.33 738.32
Deferred Tax Assets / Liabilities 619.01 501.17
Other Long Term Liabilities 58.08 27.74
Long Term Trade Payables 0.00 0.00
Long Term Provisions 152.74 137.26
Total Non-Current Liabilities 2,149.16 1,904.49
Current Liabilities
Trade Payables 1,998.96 1,677.08
Other Current Liabilities 2,170.02 2,042.47
Short Term Borrowings 228.37 573.34
Short Term Provisions 151.09 183.32
Total Current Liabilities 4,548.44 4,476.21
Total Liabilities 16,301.80 14,925.12
ASSETS
Non-Current Assets 0.00 0.00
Gross Block 7,949.04 6,713.13
Less: Accumulated Depreciation 1,873.73 1,225.55
Less: Impairment of Assets 0.00 0.00
Net Block 6,075.31 5,487.58
Lease Adjustment A/c 0.00 0.00
Capital Work in Progress 1,078.84 846.96
Intangible assets under development 0.00 0.00
Pre-operative Expenses pending 0.00 0.00
Assets in transit 0.00 0.00
Non Current Investments 1,092.42 1,080.57
Long Term Loans & Advances 369.07 322.52
Other Non Current Assets 1.31 0.01
Total Non-Current Assets 8,616.95 7,737.64
Current Assets Loans & Advances
Currents Investments 3,054.02 2,313.78
Inventories 2,172.07 2,392.92
Sundry Debtors 2,135.92 1,959.95
Cash and Bank 139.41 274.42
Other Current Assets 6.96 25.55
Short Term Loans and Advances 176.47 220.86
Total Current Assets 7,684.85 7,187.48
Net Current Assets (Including Current Investments) 3,136.41 2,711.27
Total Current Assets Excluding Current Investments 4,630.83 4,873.70
Miscellaneous Expenses not written off 0.00 0.00
Total Assets 16,301.80 14,925.12
Contingent Liabilities 380.57 394.55
Total Debt 1,703.48 2,072.05
Book Value (in ₹) 22,651.42 20,151.93
Adjusted Book Value (in ₹) 22,651.42 20,151.93
PROFIT & LOSS ACCOUNT OF MRF

Parameter MAR'18 MAR'17

(₹ Cr.) (₹ Cr.)
Gross Sales 15,227.07 14,749.40
Less :Inter divisional transfers 0.00 0.00
Less: Sales Returns 0.00 0.00
Less: Excise 405.15 1,497.18
Net Sales 14,821.92 13,252.22
EXPENDITURE:
Increase/Decrease in Stock 76.04 -222.08
Raw Materials Consumed 8,991.82 7,721.57
Power & Fuel Cost 637.65 580.32
Employee Cost 1,074.65 983.14
Other Manufacturing Expenses 691.69 634.62
General and Administration Expenses 159.37 147.60
Selling and Distribution Expenses 771.75 693.27
Miscellaneous Expenses 144.61 117.03
Expenses Capitalised 0.00 0.00
Total Expenditure 12,547.58 10,655.47
PBIDT (Excl OI) 2,274.34 2,596.75
Other Income 282.48 328.61
Operating Profit 2,556.82 2,925.36
Interest 249.57 249.84
PBDT 2,307.25 2,675.52
Depreciation 705.34 609.15
Profit Before Taxation & Exceptional Items 1,601.91 2,066.37
Exceptional Income / Expenses 0.00 0.00
Profit Before Tax 1,601.91 2,066.37
Provision for Tax 509.63 615.29
PAT 1,092.28 1,451.08
Extraordinary Items 0.00 0.00
Adj to Profit After Tax 0.00 0.00
Profit Balance B/F 0.00 384.14
Appropriations 1,092.28 1,835.22
Equity Dividend (%) 600.00 600.00
Earnings Per Share (in ₹) 2,576.13 3,422.36
Book Value (in ₹) 22,651.40 20,151.90
 MAR' 2017-18 (₹ Cr.)

Other Income
Total Income
Profit Before Taxation
Provision for Taxation
Profit after Taxation
Share Capital
Reserves
Net Worth
Fix.ASS.(G)

P&L ACCOUNT OF MRF TYRE

CASH FLOW

Parameter MAR'18 MAR'17

(₹ Cr.) (₹ Cr.)
Net Profit Before Taxes 1,601.91 2,066.37
Adjustments for Expenses & Provisions 713.08 550.52
Adjustments for Liabilities & Assets 691.91 -427.08
Cash Flow from operating activities 2,541.49 1,790.19
Cash Flow from investing activities - -
1,982.16 1,393.89
Cash Flow from financing activities -638.89 -295.31
Effect of exchange fluctuation on translation reserve 0.00 0.00
Net increase/(decrease) in cash and cash equivalents -79.56 100.99
Opening Cash & Cash Equivalents 178.35 77.36
Cash & Cash Equivalent on Amalgamation / Take over / 0.00 0.00
Merger
Cash & Cash Equivalent of Subsidiaries under liquidations 0.00 0.00
Translation adjustment on reserves / op cash balalces frgn 0.00 0.00
subsidiaries
Effect of Foreign Exchange Fluctuations 0.00 0.00
Closing Cash & Cash Equivalent 98.79 178.35
RATIO ANALYSIS ON MRF TYRE

Parameter MAR 18 MAR 17 CHANGE IN%

Operational & Financial Ratios

Earnings Per Share (Rs) 2668.89 3505.24 -23.86

CEPS(Rs) 4335.68 4945.28 -12.33

DPS(Rs) 60.00 60.00 0.00

Book NAV/Share(Rs) 22967.43 20379.15 12.70

Tax Rate(%) 31.53 29.54 6.72

Margin Ratios

Core EBITDA Margin(%) 15.14 17.72 -14.55

EBIT Margin(%) 12.40 15.85 -21.74

Pre Tax Margin(%) 10.72 14.13 -24.10

PAT Margin (%) 7.34 9.96 -26.24

Cash Profit Margin (%) 11.93 14.04 -15.07

Performance Ratios

ROA(%) 7.18 10.50 -31.65

ROE(%) 12.31 18.74 -34.27

ROCE(%) 16.71 22.90 -27.03

Asset Turnover(x) 0.98 1.05 -7.33

Sales/Fixed Asset(x) 2.10 2.49 -15.77

Working Capital/Sales(x) 4.71 5.31 -11.32

Efficiency Ratios
 Fixed Capital/Sales(x) 0.48 0.40 18.72

Receivable days 48.78 46.55 4.79

Inventory Days 54.74 52.87 3.54

Payable days 32.62 31.53 3.48

Valuation Parameters

PER(x) 27.09 17.32 56.38

PCE(x) 16.68 12.28 35.81

Price/Book(x) 3.15 2.98 5.65

Yield(%) 0.08 0.10 -16.01

EV/Net Sales(x) 2.17 2.07 5.04

EV/Core EBITDA(x) 12.45 9.32 33.56

EV/EBIT(x) 17.05 11.72 45.42

EV/CE(x) 1.98 1.84 7.28

M Cap / Sales 2.04 1.92 6.46

Growth Ratio

Net Sales Growth(%) 11.84 -33.54 135.31

Core EBITDA Growth(%) -12.04 -37.38 67.79

EBIT Growth(%) -19.21 -41.09 53.25

PAT Growth(%) -23.86 -40.77 41.48

EPS Growth(%) -23.86 -40.77 41.48

Financial Stability Ratios

Total Debt/Equity(x) 0.22 0.27 -17.71

Current Ratio(x) 1.71 1.62 5.45

Quick Ratio(x) 1.23 1.09 13.68

Interest Cover(x) 7.39 9.22 -19.89

Total Debt/Mcap(x) 0.07 0.09 -22.10

SWOT ANALYSIS OF MRF TYRE:

STRENGTHS

 INNOVATION
 SUPPLY CHAIN
 MARKET SHARE LEADERSHIP
 STRONG FINANCIAL POSITION

OPPORTUNITES

 ACQUISITION
 EMERGING MARKET & IMPOROVED LIFE STYLE
 PRODUCT & SERVICE EXPANSION
 EXPANSION ABROAD
WEAKNESS

 LOW R&D
 RISING RUBBER PRICE

THREATS

 PRICE WAR
 COMPETITION
 EXTERNAL CHARGES(TEX,POLICIES)
 CHAPTER -3

RESEARCH METHODOLOGY
OBJECTIVES OF THE STUDY:

 To know about Mrf ltd. As an organization

 To know the financial position of mrf ltd.

 To know the tyre industry in India

 To know the competitive strategy adopt by mrf ltd.

 To study the operation performed at various levels of department

 To know the managing activity

 To know the quality standards of the product

 To know the functioning of the various department

 To observe the routine activity of the workers iv various level

 To understand the organization structure

3 Data sources

Secondary data sources

 Books.
 Journals.
 Magazine.
 e- Journals.
 websites.
 companies records.
4 Limitations of study:-

 The area of study is limited.

 The bias response from the respondents may have introduced errors in the
survey findings.
 Sample is limited.
 Time constraint.
 Sample of only few respondents is selected from the population.
 Some of the respondents were not ready to fill the questionnaires and some of
them were not ready to come out openly.
 CHAPTER – 4

ANALSIS OF INTERPRETATION
To achieve the stated objective a survey was conducted at Dehradun city regarding customer
“satisfaction towards MRF Tyres” provided by D.D.Tyres show room Dehradun. Primary Data:
Primary data is collected by the random sampling method. Here we have randomly interviewed
50 customers through Questionnaire and personal interview and collected the primary data.
Secondary Data: These are generally published sources which have been collected originally for
some other purpose, they are not gathered specially to achieve the objectives of the particular
research project hands but already assembled. Survey Techniques: Once the researcher has
decided to use survey method for collecting data he has to make a decision to adopt any one of
the following survey techniques.

1. Personal interview

2. Telephone survey

8.DATA ANALYSIS AND INTERPRETATION

I have conducted marketing survey on 50 customer to analysis their satisfaction level, forthis
purpose I have prepared a questionnaire to collect the information from them. Among these50
customers, only some of them responded as per that now we will see the analysis of the
collected data.
1. The following tables shows the factors which motivated the customer to purchase the
“MRF TYERS”

factor customer
Friend 8
Brabd image 9
Advertisment 9
Relatives 8
Self-decision 16
TOTAL 50

Friend
Brabd image
Advertisment
Relatives
Self-decision

Interpretation

The above table & graph shows that:

A) A. 16 customers have purchased MRF Tyres by their own decision.

B. 8 customers have purchased MRF Tyres by their Friends recommendation.

C. 9 customers have purchased MRF Tyres by its Brand Image.

D. 9 customers have purchased MRF Tyres on the basis of Advertisement.

E. 8 customers have purchased MRF Tyres on their Relatives recommendation.

2) The following tables shows the level of satisfaction of customer

need/purpose of purchasing “MRF TYRES”

Particular No. of person

Fully Satisfied 23
satisfied 17
Dissatisfied 7
fully Disssatisfied 3
Total 50

Fully Satisfied
satisfied
Dissatisfied
fully Disssatisfied

Interpretation

The above graph shows that

 45 % of people are fully satisfied with the purchase of MRF tyres.

 35 % of people are just satisfied with the purchase of MRF tyres.
 13% of people are dissatisfied with the purchase of MRF tyres.
 7 % of people are fully satisfied with the purchase of MRF tyres
 2. As compare to other tyres the “MRF TYRES” are rated as below

. A) Price of Tyres

Column1 Column2
Storngly Satisfied 15
Satisfied 16
Not Satisfied 10
Fully NotSatisfied 9
TOTAL 50

Storngly Satisfied
Satisfied
Not Satisfied
Fully NotSatisfied

Interpretation

 30 % of customers are strongly satisfied with the price of MRF tyres.

 35 % of customers are satisfied with the price of MRF tyres.
 21 % of customers are not satisfied with the price of MRF tyres.
 14 % of customers are fully not satisfied with the price of MRF tyres.
B) Quality Of Tyres

Column1 Column2
Storngly Satisfied 23
Satisfied 15
Not Satisfied 8
Fully NotSatisfied 4
TOTAL 50

Column2

Storngly Satisfied
Satisfied
Not Satisfied
Fully NotSatisfied

Interpretation

 45 % of customers are strongly satisfied with quality of the tyres.

 30 % of customers are satisfied with quality of the tyres
 16 % of customers are not satisfied with quality of the tyres
 9 % of customers are fully not satisfied with quality of the tyres
C) Durability of Tyres

Column1 Column2

Storngly Satisfied 23

Satisfied 16

Not Satisfied 7

Fully NotSatisfied 4

TOTAL 50

Storngly Satisfied
Satisfied
Not Satisfied
Fully NotSatisfied

Interpretation

 45% of customers are strongly satisfied with durability of tyres

 32%of customers are satisfied with durability or tyres
  14%of customers are not satisfied with durability or
 9%of customers are fully not satisfied with durability of tyres.

D) Performance Of Tyres

Column1 Column2
Storngly Satisfied 21
Satisfied 17
Not Satisfied 7
Fully NotSatisfied 5
TOTAL 50

Storngly Satisfied
Satisfied
Not Satisfied
Fully NotSatisfied

Interpretation

 48% of customers are strongly satisfied with the performance of tyres

 30% of customers are only just satisfied with the performance of tyres
 13% of customers are not satisfied with the performance of tyres
 9% of customers are fully not satisfied with the performance of tyres
CHAPTER -5
FINDINGS
Findings

1) 31% of customers have purchased on there own decision. They have decision on the basis of
experience and some customers have taken after making comparison with other tyres. Hence it
reveals that customers are satisfied with “MRF TYRES”

2) Majority of customers means 45% are satisfied with the fulfillment of their need/purpose.

3) Only 30% of customers are fully satisfied with price of the tyres about 21% are not satisfied
and 14% of customers are fully not satisfied with the price.

4) About 45% of customers are fully satisfied,30% of customers are only just satisfied and 16%
are not satisfied with the quality

5) About 45% of customers are satisfied with durability of tyres, and 14% are not satisfied with
durability.

6) about 42% of customers are fully satisfied with the performance of the tyres, and only 14%
are dissatisfied.

7) the customers are having a very good opinion about the MRF TYERES” about 28% are
strongly satisfied with its performance, and only 17% are not satisfied with performance.

8) the customers are having very good opinion about the behavior of showroom people about
44% of customers are saying they are friendly and only 13% are don’t know.

9) The service charges are very reasonable in the view of about 43% of customers and about
11% of customers believe that the service charges are costly.

10) Majority of customers are fully satisfied with the “MRF TYRES”
SUGGESTIONS (To the Board of Directors)
paper may be planned in addition to the other sources of finding funds so as to
get optimal capital-mix to lever profit.

➢Business Intelligences a process through which the performance of an

organization is monitored with KPI‟s (Key Performance Indicators) and

reported for immediate action and follow up. It is a “Measure- Monitor-
Manage- Analyze-Plan system. It provides Dash boards and multiple
scorecards with visual indicators along with traffic signals- red, green and
yellow. It gives alerts and work flow corrections to take corrective actions
and to run the affairs at the least cost.

➢Apollo tyre company must take effective steps to collect the dues from

debtors in time to minimize the debtors turnover ratio.

➢The earnings power and profit margin ratio is poor in Ceat and JK. These

companies should improve the profitability by increasing the turnover and

cost reduction.

➢Sales growth is low in MRF Ceat, JK and Apollo when compared to MRF and

Balkrishna. Hence these companies should improve the turnover to meet

the competition.

OTHER SUGGESTIONS

➢The production system in the Indian tyre industry has been traditionally

very labour intensive. The firms should resort to automation in order to

tackle problems related to labour unionization and indiscipline in the
sector.

➢In order to safeguard the Indian tyre industry share in the export market

there is also an urgent need to increase the degree of radialisation. Global

tyre manufacturers have been tanking constant efforts to innovate and
offer a diverse range of products flat tyres, eco-friendly tyres and energy
efficient tyres. In this context the Indian domestic companies should
pursue a growth strategy of continuous innovation and increasing
emphasis on product differentiation.

➢The increase in import duty on natural rubber from 20 percent to 25

percent would be another challenge for the tyre industry. The change in
duty is likely to result in further increase in import of cheap tyres at 10
percent duty and will hinder the growth of capacity investment by domestic
tyre industry. The tyre industry has urged the government to increase the
customs duty on tyre import. For successful implementation of
“Make in India” campaign to promote domestic manufacturing and to make
the product competitive it is important that import of finished goods
magnetize duties at least as much if not more than what is levied on raw
materials.

➢The government of India has to take initiatives to facilitate the growth of

tyre industry includes

a. No restriction on the import of raw materials.
b. Increasing thrust on development of road infrastructure.

➢The domestic tyre manufacturers should adopt technology generation that

leads to development research. The sources of technology for the

domestic firms have been through reverse engineering, joint ventures and
collaborations. The emphasis should be given by Indian tyre industry to
applied research and setting up of well equipped in house R & D centers
which are manned by experts and experienced professionals who have
also helped the technology upgradation. Indian tyre technology should
exhibit versatility in maintaining inflow technology through foreign
collaborations and tailoring the same to the Indian needs.
➢The Indian tyre companies should expand the distribution network.

➢The global tyre manufacturers launch airless or non-pneumatic tyre for the

passenger vehicles. The airless tyre technology features a unique spoke

structure designed to support the weight of a vehicle effectively eliminating
the need to periodically refill the tyres with air. Therefore the domestic
manufacturers should develop the airless tyres to avoid a spare tyre which
leads to better fuel economy.

1. Advertisement:-MRF Tyre should spend more on advertisement activities to attract those

customers who does not know about JK Tyre. If you see JK Company they can spend
more and more money on Advertisement and promotion campaign and that’s why they
can increase customer through advertisement activities and also his advertisement are
more attractive in compare of other tyre brands.
2. Schemes: - The Company should come up with attractive schemes so that the existing
Dealer and Sub Dealer can get benefit from the scheme and can order more tyre from JK
Tyre. Separate schemes should be made for the Dealer and Sub Dealer who are a new in
market. but they have to bring more schemes so that dealers get a good push to sell the
products and customers feel motivated to buy the products for e.g. :- more cash discount ,
foreign trip , Gifts , etc.
3. Hoardings and posters: - Hoardings and posters can be put over to public transports like
buses, metros and railway stations where maximum number of people visits daily it will
create brand awareness.
4. Margin:-Dealer are getting very high margin from the other brands so the company
should also take care of it Dealer expectations so that it will fulfil their needs and keep
them satisfied.
QUESTIONNAIRE
Dear Sir/Madam,(Please tick ( ) appropriate answer in the box / space)

I). Customer Introduction:

a. Name: _____________________________________________

b. Address: _____________________________________________

c. Occupation / Job: ____________________________________________

II). which factors motivated you to purchase “MRF TYRES”?

A: Friends [ ] B: Brand Image [ ] C: Advertisement [ ]

D: Relatives [ ] E: Self decision [ ] F: Others [

] III). To what extent the “MRF TYRES” has satisfied your purpose / need? A:Fully Satisfied [
] B: Satisfied [ ] C: Dissatisfied [ ] D: Fully Dissatisfied [ ]

IV). As compare to other tyres how do you rate the following characteristics of your “MRF
TYRES”

Characteristics Excellent Very good Good Average

Price
Quality
Durable
Performance
Mileage

V): What is your opinion about “MRF TYRES”?

A: Excellent [ ] B: Very Good [ ]

C: Good [ ] D: Bad [ ]
VI): what was the behavior of show room people while taking quotations or while Purchasing
“MRF TYRES”?

A: Very Friendly [ ] B: Friendly [ ]

C: Not-Friendly [ ] D: Don’t Know [ ]

VII): What is your opinion about “service charges” in the show room?

A: Very Reasonable [ ] B: Reasonable [ ]

C: Costly [ ] D: Very Costly [ ]

VIII): Why did you prefer “MRF TYRE”?

A: Quality [ ] B: Price [ ]

C: Service [ ] D: Durability [ ]

IX): What problems faced while purchasing “MRF TYRES”?

A: Lack of information’s [ ] B: Non co-operations of show room peoples [ ]

C: Delay [ ] D: No problem ]

X): Give your valuable suggestions to improve “MRF TYRES”?

A: __________________________________________________

B: __________________________________________________

C: __________________________________________________

Learning and Experience

Learning forms an important part is a student’s life. Each and every opportunity provided should
be utilized for betterment of one’s career. Throughout my summer internship of 6 weeks, I was
able to get a valuable exposure of the corporate world.
The major learning’s were:
1 Professional attitude towards work
2 Sincerity of completion of work assigned
3 Punctuality of time
4 Know about tyre industry dealer and customer.
5 Know The Basic of tyre marketing.
6 Familiar with tyre Dealers are of Delhi.
7 Learn about basics of two wheeler tyre
8 Understand the Customer and Dealer Demand Pattern.
9 To communicate well with Dealers about the sale schemes, price of the products, commission
etc.
Conclusion
During this marketing research, I have learnt lot of thing. It was really a great
experience, while doing project report on MRF tyre, how to explain them to fill
up questions and what kind of complains are raised by customers and Dealer
during marketing research. This task is learning through only practical study. It
was really a nice experience to do project on MRF tyre entering in two wheeler
segment and work with Parinay Gausain. That is really good. In my report I
have research on an “Analysis of Dealer and Customer Satisfaction”.
1 Customers’ demands are less of MRF Tyre in a compared to other tyre
industries because due to less advertisement activities in compare of other tyre
industries.

2 Most of the Dealer are not very happy with MRF Tyre because they say
improve a quality and increase branding activities.

3 Summer internship has helped me to gain the knowledge about the Tyre sector
as well as channel sales methodology.
 AWARDS & ACHIEVEMENT

J D Power India 2018

MRF Brand of Car/SUV tyres ranked Highest in Customer
Satisfaction. The 13th win for MRF!

CAR INDIA AWARDS 2018

Perfinza by MRF won the Product of the Year award

FORD WORLD EXCELLENCE

AWARDS
MRF won the silver award and is the only Indian company to
win this excellence award.
 J D POWER ASIA PACIFIC
MRF won the award for customer satisfaction not once but
12 times till date.

TNS
MRF voted the "Most Trusted" Tyre company in India by
TNS 2006 global CSR study.
 CAPEXIL
MRF won the award for exports.
BIBLIOGRAPHY

1 www.google.com
2 www.wikipedia.com
3 www.slideshare.com
4 http://www.htmlpublish.com/newTestDocStorage/DocStorage/17e
2e05c65ec4a5d9ce8abbd87896b05/SH-2015-Q3-1-ICRA-Tyres.rtf
5 http://www.atmaindia.org/production-export-trend.html
6 http://www.mrftyres.com/services/tyretok
7 https://www.google.co.in/forms/about/
8 http://www.Mrftyre.com/productselector.aspx
8 http://www.JKtyre.com/productselector.aspx