PPAP Automotive Ltd.
CRISIL has assigned its ratings of' A+/Stable/P1' to the various bank facilities of PPAP Automotive Ltd. The ratings reflect PPAP Automotive Ltd. leadership position in the Polyvinyl Chloride (PVC)/ Thermo Plastic Olefins (TPO) Profiles, strong relationships with large Original Equipment Manufacturers (OEMs), and healthy financial risk profile, backed by comfortable capital structure and debt protection measures. These strengths are partially offset by PPAP Automotive Ltd. exposure to high customer, end user industry, and geographical concentration and vulnerability of margins to fluctuations in prices of raw materials.
CRISIL believes that PPAP Automotive Ltd. will maintain its established position in PVC/TPO profiles and sealings for the automotive segment, and its strong capital structure over the near to medium term. The outlook may be revised to 'Positive' if the Company reports a substantial growth in sales. Conversely, the outlook may be revised to 'Negative' if the Company fails to ramp up sales from new capacities, or its operating margins deteriorates significantly.
About the Company
PPAP Automotive Ltd., set up in 1978 as a partnership firm by Mr. D C Jain, Mrs. Asha Jain and Mrs Vinay Kumari Jain, was converted into a public limited company in 1995. The company manufactures and supplies profiles to customers in the automobile, white goods, and other segments. It derives more than 90 per cent of its revenues from the automobile segment, while the white goods segment accounts for five per cent of its revenues. In January 2008, Precision Pipes raised Rs.750 million through an initial public offering.
For 2007-08 (refers to financial year, April 1 to March 31), PPAP Automotive Ltd. reported a profit after tax (PAT) of Rs.193.9 million on net sales of Rs.1.26 billion, as against a PAT of Rs.139.6 million on net sales of Rs.1.09 billion for the previous year.
PPAP Automotive Ltd.. to pay 30% Dividend
The Board of Directors of Precision Pipes and Profiles Automotive Limited (PPAP Automotive Limited) has recommended 30% dividend for the year 2007-08. The dividend is on enhanced capital base of Rs. 1400 Lacs and will result in a payout of Rs. 420 Lacs
The total income of the Company has registered a growth of 16% compared to the previous year from Rs.10973.36 Lacs to Rs. 12741.96 Lacs. The Net Profits have grown by about 39% to Rs. 1938.63 Lacs compared to the previous year. The significant improvement in the Net Profits of the Company is on account of effective utilization of raw materials and decrease in manufacturing expenses on account of better utilization of resources.
While the Auto business division of the Company contributed around 92% of the Company, White Goods division, electrical and construction division contributed the remaining 8 % of the Turnover. During the year the installed capacities of the Company increased from 47.50 Lakh KG to 59.00 Lakh Kg mainly on account of setting up of Electrical Mainline Division at Badarpur New Delhi. This division has received its first commercial order from its Australian Collaborator and deliveries against these have started from the month of January, 2008
During the Financial year 2007-08 the Company was awarded for Outstanding Performance in the category of Cost by Honda SIEL limited. Toyota Kirloskar Motors Limited gave the Best Vendor Award to the Company in the Category of Cost, Quality, Zero PPM and Best Quality Supplier (Delhi Region).
The New Plant at Surajpur Industrial Area, Greater Noida, UP for which funds were raised through an IPO during the year, is in advanced stage of implementation and commercial production at this plant is expected by September, 2008.
PPAP Automotive Limited is a leading manufacturer of high quality automotive sealing systems and exterior products in India. The company has six state of the art manufacturing facilities, which are located in New Delhi and Noida UP. All the plants are TS 16949, ISO 14001 and OHSAS 18001 certified. PPAP Automotive Limited's core competence is in Plastic Extrusion and Injection molding.
In association with Tokai Kogyo Co. Ltd. (Japan), the Technical Collaborator of the company, today PPAP Automotive Limited is the single biggest supplier of Automotive Sealing Systems, Profiles And Extrusions to Maruti Udyog Limited (The Biggest Automobile Manufacturer in India), Honda SIEL, Krishna Maruti, Toyata Kirlosker, TS Techson, Fiat India And General Motors India Limited. The automotive product range includes Weather-strips, Body Side Moldings, Roof Trims and Moldings, Windshield Moldings, Quarter Window Trims, Door Opening Trims and Fuel Hoses.
PPAP Automotive Limited is also the largest OEM supplier of Rigid PVC Extrusions to all the Refrigerator and Visi-cooler (Commercial Refrigerators) manufacturers in India. In addition the company also caters to the furniture, electrical, building and construction industry. This product range includes refrigerator bottle-shelf and wire-shelf trims, Visi-cooler Door and Thermal Breaker profiles, Chest-freezer Profiles, Rolling Shutter Profiles (Tambour Door profiles), Door Sash, Extruded parts with decorative foil and various other post extrusion processes. In this field again, the company has managed to secure an ‘Excellent’ quality rating from OEM’s such as Carrier, Electrolux, Godrej, Videocon, Voltas and Blue Star etc.
PPAP Automotive Limited’s export division supplies customized extruded parts to various industries overseas. These products are being exported to many countries such as the UK, Australia, New Zealand, France, Italy, countries in the Middle East etc.
Newly listed automobile industry OEM, PPAP Automotive Limited posts healthy nine monthly results.
Total Income up 19.34%, Net profit, 53.5%, EPS rises to 15.39
New Delhi, 30th Janaury, 2008:PPAP Automotive Ltd.., the automobile industry OEM which had a highly successful public issue and listing last December came out with impressive nine-monthly results for the period ended 31st December, 2007. Total income grew to Rs.90.34 crore from Rs.75.72 crore for the same period last year. 82.6% of this income came from sales to the automobile sector.
For the same respective periods net profit rose from Rs 9.02 crore to Rs. 13.85 crores, a whopping 53.5 % rise. The EPS rose to 15.39 from last years corresponding figure of 10.02
PPAP Automotive Limited is an OEM for the automobile industry and its clients include Maruti Udyog Limited, Honda SIEL, General Motors and Toyota Kirloskar. In the white goods industry, it supplies customized profiles to Godrej, Voltas, Videocon and Carrier Refrigerators. Over 80% of its revenues are derived from the automobiles segment. Since 1989, PPAP Automotive Limited has a technical agreement with Tokai Kogyo Co Ltd.
(TKCL), Japan, which is a manufacturer of specialized profiles and extrusions for automobile industry. This agreement helped PPAP Automotive Limited in diversifying into specialized products for the automobile industry. PPAP Automotive Limited has also entered into an Automotive Parts Licensing agreement with Nissen Chemitec Corporation, Japan. Nissen would provide PPAP Automotive Limited new product technology in order to manufacture and deliver products in connection with automotive interior parts and related products to Honda SIEL Cars India Limited and its affiliated companies. The company also has entered into an agreement with Power and Data Corporation Pty Ltd., Australia for the manufacturing of electrical outlet systems for supply to the authorized distributors of
PDC. CRISIL has an SME 1 rating outstanding on PPAP Automotive Ltd., which is valid till 17th May 2008