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Amtek Auto Ltd.

BSE: 520077 Sector: Auto
NSE: AMTEKAUTO ISIN Code: INE130C01021
BSE LIVE 15:58 | 02 Dec 38.40 -1.40
(-3.52%)
OPEN

39.15

HIGH

39.35

LOW

38.10

NSE LIVE 15:59 | 02 Dec 38.30 -1.50
(-3.77%)
OPEN

39.50

HIGH

39.50

LOW

38.05

OPEN 39.15
PREVIOUS CLOSE 39.80
VOLUME 259441
52-Week high 56.20
52-Week low 26.05
P/E
Mkt Cap.(Rs cr) 863.04
Buy Price 0.00
Buy Qty 0.00
Sell Price 38.40
Sell Qty 395.00
OPEN 39.15
CLOSE 39.80
VOLUME 259441
52-Week high 56.20
52-Week low 26.05
P/E
Mkt Cap.(Rs cr) 863.04
Buy Price 0.00
Buy Qty 0.00
Sell Price 38.40
Sell Qty 395.00

Amtek Auto Ltd. (AMTEKAUTO) - Chairman Speech

Company chairman speech

AMTEK AUTO LIMITED ANNUAL REPORT 2002-2003 CHAIRMAN'S REPORT To the members of Amtek Auto Limited at the 17th Annual General Meeting held on 27th December, 2003. Ladies and Gentlemen, welcome you all to the 17th Annual General Meeting of the company and express my thanks for having spared your valuable time to attend the meeting. The Annual Report of the company for the period ended 30th June, 2003 must have apprised you of the achievements of your company during the year. However, I take this opportunity to personally share with you the strategies and future growth prospects of the company. Overview The Indian economy is one of the fastest growing economies of the world. During the current year, the country has been blessed with good monsoon which had a positive effect on the country's economy. The Indian Economy is witnessing a mood of buoyancy with feel good factor. Both the manufacturing and service sectors are performing well. Economy is expected to achieve GDP of 8%. Indian Companies have started acquiring overseas companies to become truly global players. The forex reserves are at an all time high. The Indian Companies have proved that if provided with opportunity and infrastructural facilities, they are comparable to the best of the world. The Indian automotive components manufacturing industry is consistently growing due to a sharp growth in the exports in the last 2 to 3 years. The next big opportunity emerging for the Indian companies is the automotive component exports as the global automotive OEMs are focusing on third world countries especially India for their global sourcing programs. The total worth of components procured by global OEMs from India last fiscal was US$ 375 Million and the same is estimated to increase to a whopping US$ 1.5 Billion in the current fiscal. Thus has been a result of a silent revolution in the Indian automotive component industry which has boosted productivity and quality of the Indian component manufacturers and placed them ideally to emerge as big another success story of our times. Automotive components industry experts have pegged the worth of the global automotive components industry at US$ 750 Billion of which the current exports from India area mere $ 375 Million or 0.5% only. However, the future of the Indian component industry looks very exciting. The Indian component industry is likely to see a consistent growth rate of 35 to 40 %. The Indian automotive component manufacturers are estimated to export components worth a whopping US$ 15 Billion by the year 2010. The global sourcing will not remain confined to the global OEMs only. Leading automotive component assembly & systems suppliers who have multi-national operations are likely to focus on outsourcing rather than manufacturing in Europe and the Americas due to constant cost reduction pressures from their customers. The domestic automobile industry has had a good run in the last year which, as per the industry experts, is likely to continue for some time. The development of road networks and national highways has infused a new lease of life to the commercial vehicle manufacturing industry in India with the last year recording a year on year growth of43.20 % for the M&HCV category and an overall growth of 34.60 %. The passenger car industry has also seen a handsome growth during the last year in view of an ever increasing market demand fuelled by the increase in the disposable income of the middle-class of India. The two-wheeler industry, which has considerable volumes in India, is on the verge of another boom. The growth rate of motorcycles over the last few years has also fuelled the overall growth of the industry. This translates into direct benefits to the local automotive component industry. Amtek Auto Limited is a leading manufacturer of automotive components and assemblies serving the global automotive industry as an Original Equipment supplier. The company has created an indelible mark on the Indian Automotive Industry and is set to consolidate its position in the global automotive scene. SALES AND PROFITS During the period, your Company performed exceedingly well with sales recording an increase of 85.89 % and net profit after tax recording increase of 84.38% over the previous year. I take pleasure to inform you that for the past eight years your Company has maintained dividend consistently at 20% p.a.. The current year's dividend is free of tax in your hands. BONUS ISSUE During the period under review, the company rewarded its shareholders by way of bonus shares in the ratio of 1:1. The shareholders have been benefited not only by way of additional shares but also by dividend on existing as well as bonus shares taking the effective dividend on there bonus issue to 40%. GROWTH THROUGH ACQUISITION Your company is moving in line with the strategies drawn by the board for growth. I am delighted to inform you that during the period under review, your Company acquired two companies engaged in the auto components sector viz. Ahmednagar Forgings Ltd., Pune and Smith Jones Inc., USA. Ahmednagar Forgings Limited has four units in Pune including one fastener unit. The company has turnover of more than Rs.100 Crores. It has an impressive clientele like Bajaj Auto, Tata Motors and Honda Scooters & Motorcycles India to name a few. With this acquisition Amtek Auto Limited has become the second largest manufacturer of forgings in the country with combined installed forging capacity of 72500 tons per annum. The forging facilities of Amtek Auto Ltd. And Ahmednagar Forgings Limited are located indifferent regions of the country which enables it to meet the customers' demand locally. Another subsidiary, Smith Jones Inc. is based in State of Iowa in the United States of America. This is the largest manufacturer of Flywheel Ring Gears and Flex Plate Assemblies in U.S.A. The Company has two manufacturing units which are accredited with QS-9000 certification. The acquisition of Smith Jones Inc. will help Amtek to penetrate the U. S and European markets. Smith Jones has turnover of US$19.45 Million and has most of the U.S. and European auto giants as its clients. CONSOLIDATION OF BUSINESS Presently, Amtek Group is the leading player of various auto components with over 300 varieties being manufactured by various Subsidiaries and Associated companies in India and abroad. The company expects to benefit substantially in form of outsourcing orders from its subsidiaries and associated companies abroad. Amtek Group, in order to become a truly global player with strong base and single identity, is planning to consolidate the entire business of the group within a span of next two to three years under the leadership of Amtek Auto Limited. In order to accomplish this goal the Company has already appointed Ernst & Young as advisor for chalking out the strategy for consolidation process. The management believes that the consolidation of these businesses shall lead to enhanced stakeholders value. FUTURE BUSINESS STRATEGY In order to enter overseas markets with full strength, your company has undertaken various initiatives that will help it to face the challenges in the global market. In today's world of changing technologies, it is very important for every organization to keep abreast with new technologies. Towards this end, your company is now investing heavily in new technologies and R & D facilities especially in the form of latest software oriented designs and in-house product development. This has not only improved product quality but has also accelerated production. The company is also making capital investments in the form of latest machines with higher capacities to meet the growing demand. The company is also taking all steps towards cost cutting to improve the profitability. With increased capacities, wider acceptability and expanding markets, the future outlook of your company appears very promising. CAPITAL MARKET RECOGINITION The improved performance of your company has attracted investment from various quarters including FIIs. The Board of Directors of the company met yesterday to consider enhancement of investment limit by FIIs from 24% to 49% of the paid up Equity Share Capital of the company and approved the proposal subject to the approval of shareholders. The Board has also convened the Extra Ordinary General Meeting of the company which is scheduled to be held on 27th January, 2004 for shareholders approval. Your Company's share has recorded reasonable growth in recent years. A large number of analysts, who follow the progress of the Group, have almost without exception been positive about the company and we have had a good reputation in the market. The most important parameter of our company's progress is how our customers and investors perceive Amtek and I am sure in recent times the image of your company has sharpened to a great extent. ACKNOWLEDGEMENT I wish to place on record the sincere and dedicated efforts of all the members of the company's team who have displayed their unstinted devotion, Cooperation and commitment towards the pursuit of excellence. I also take this opportunity to offer sincere thanks to the financial Institutions, Banks, Govemment Agencies, our valued customers for their continued support and assistance. I also express my profound thanks to the shareholders for their faith and continued support to the endeavors of the company. Finally, I express my personal gratitude for the unstinted faith reposed by you in the company's management and sincerely hope that we will continue to receive the same kind of support and guidance towards achievement of higher goals. Thanks, Arvind Dham (Chairman)

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