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INDEX SR NO . PARTICULARS PAGE NO . 1) INTRODUCTION 03 2) INDUSTRY PROFILE 04 3) COMPANY PROFILE 05 4) VISSION AND MISSION 07 5) BACKGROUND OF THE COMPANY 08 6) MAJOR COMPANY 11 7) COMPETITORS IN INDIA 12 8) PRODUCT PROFILE 26 9) AREA OF OPERATIONS 28 10) AWARDS AND ACHIEVEMENT 32 11) FUTURE GROWTH PROSPECT 35

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Page 1: Lalit Mrf Tyres

INDEXSR NO . PARTICULARS PAGE

NO .1) INTRODUCTION 032) INDUSTRY PROFILE 043) COMPANY PROFILE 054) VISSION AND MISSION 075) BACKGROUND OF THE COMPANY 086) MAJOR COMPANY 117) COMPETITORS IN INDIA 128) PRODUCT PROFILE 269) AREA OF OPERATIONS 2810) AWARDS AND ACHIEVEMENT 3211) FUTURE GROWTH PROSPECT 35

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INTRODUCTION

MRF Tyres was established in the year 1946 by a young entrepreneur, K. M. Mammen

Mappillai, opened a small toy balloon manufacturing unit in a shed at Thiruvottiyur,

Madras (now Chennai). On its start, the company had no machines in the unit but it

just had an employee bubbling with great enthusiasm, innovative ideas and great

vision, the owner himself.

Any product that could be produced out of rubber without any machinery was

produced. From toy balloons to latex cast squeaky toys, industrial gloves,

contraceptives, the list is very long. The company name is an acronym for “MADRAS

RUBBER FACTORY”. Since 1946 MRF has emerged as the largest tyre manufacturer in

India and 13th largest in the world with a turnover of Rs.5000 crores. It has a built

capacity of six million tyres from six production facilities in India.

MRF Ltd. was incorporated towards the end of 1960 and was converted into a public

limited company in 1961. The company caters to all the vehicular segments from

commercial vehicles and passenger cars to two-three wheelers and tractors and

tractors. It has its strong presence in both the radial and cross ply segments. MRF

TYRES, India's No. 1 tyre manufacturing company manufactures an extensive range of

superior quality tyres in six production facilities in India. It boasts of 68 sales centers

and 2500 distributors and exports its products to over 75 countries worldwide - a

standing testimony to MRF's outstanding leadership.

The main quality objective of the company is to “attain global standards through the

continuous improvement in the quality of products and services and also to maintain

market leadership.”

The main strategy of this company in today`s competitive world is to:

“Cut Cost and Win the Battle”

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OBJECTIVES OF THE STUDY

To identify the organizational culture and structure of MRF Ltd., Kottayam. To study the various departments and their functions. To study about the various products and services offered by the company. To study the day to day activities of MRF Ltd. To make a SWOT analysis of this organization to understand and suggest measures to overcome the weaknesses and threats within the scope of this study.

SCOPE OF THE STUDY Useful for academic purpose and further reference. Provides information about the functioning of the tyre industry in India.

LIMITATIONS Time was a limiting factor during the study. Limited number of employees who were selected for the survey of this study. Some core data could not be collected due to confidentiality policies of the company.

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INDUSTRY PROFILE

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TYRE INDUSTRY

Robert W Thompson a Scottish Engineer invented the pneumatic tyre in 1845. In 1970

the first

solid rubber tyre appeared in England. Hon Dunlop, a Scottish veterinary surgeon

improved on

Thompson`s invention in 1988.

Till 1960`s foreign companies dominated the tyre industry. During late 60`s and early

70`s

Indian Industrial Entrepreneurs entered the market with foreign collaborations. As

automobile

sector began to take its roots in the country, the tyre industry witnessed the entry of

many players

and with the waves of liberalization sweeping the land in 1922; the industry saw the

same as a

part of joint ventures.

GLOBAL MARKET MAJORSBridgestone Michelin Good Year Continental Sumitomo Pirelli Yokohama Kumho Cooper Toyo

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Oust Hankook MRF Shangai Chinghi Gajab Tungsad

The tyre industry in India came into existence with an established trading outfit by US

based Fire

Stone Tyre and Rubber Co. in 1922 followed by Dunlop Rubber Co. of UK in 1926.

Initially

they were trading companies but subsequently diversified into manufacturing sector

with plants

in West Bengal by Dunlop and in Mumbai by Fire Stone in the year 1932.

This Rs.19000 crore industry fully depends on agricultural and industrial performance

of the

economy, the transportation needs and the production of vehicles in the country.

Indian tyre

industry is one of the largest in the world with more than 100 million motor vehicles

on the

Indian roads.

SALIENT FEATURES OF INDIAN TYRE INDUSTRY

Adaptability and absorption Innovativeness Exports Technology progression Wide product range for diverse usage

INDIAN MARKET MAJORSMRF Ceat Apollo Good Year J K Tyres Modi

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BridgestoneThe Indian Tyre Industry produced 736 lakh units of tyres (11 lakh tonnes) garnering Rs. 19,000crores in FY 07-08. MRF Ltd. was the market leader (22% market share) followed closely byApollo Tyres Ltd. (21%). The other major players were JK Tyre & Industries Ltd (18%) andCeatLtd.(13%).

Market Share OF INDIAN TYRE INDUSTRY-FY 07 MRF 22% Apollo Tires 21% J K Tires 18% Ceat 13% Others 26%

Market of Tyre can be classified into 3 categories

Original Equipment Manufacturer (OEM) Replacement Market Export MarketGlobally, the OEM segment constitutes only 30 per cent of the tyre market, exports 10

per cent

and the balance from the replacement market. In India the major demand comes from

the replacement market accounting for around 48.70 per cent. It is followed by 42.80 per cent

from the Original Equipment manufacturers (OEM) and 8.50 per cent from the exports.

Retreading is looming over the tyre industry as a colossal threat.

Simply put, rethreading is replacing the worn-out tread of the old tyre with a new one.

The popularity of rethreading stems from the fact that it costs only 20 per cent of a

new tyre but increases its life by 70 per cent to 80 per cent. Most of the transporters

in India retread their tyres twice during its lifetime, while a few fleet owners even

retread thrice. Though retreading has penetrated 25 per cent of the tyre market, it

has not made much of a dent in the rapidly growing two-wheeler and passenger car

segments.

The Tyres produced in India are

Cross Ply Radial

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Cross ply tyres have been used in India for several years. The cross ply trestle pooly

cords run

across each other or diagonally to the outer surface of the tyre. Rayon and Nylon

cords are used

as the reinforcing medium. These tyres can rethread twice during their lifetime and

hence preferred by the Indian transporters who normally overload their trucks. In

India 90-95% tyre is

sold of this type. Radial tyre have their cord running radially from bead at 90* angles

to their rim or along the outer surface of the tyre. The reinforcing mediums used in

these tyres are polyester, nylon, fiberglass and steel. Hence it provides for a longer

life time and lower fuel consumption, with better consumption, better control over

vehicle and road holding.

Radial tyre usage has shown has shown significant increase in usage every year. In

India almost

all automobile segments have shifted to radial tyres and the usage of cross ply is

restricted to trucks and buses only.

The Indian tyre industry is mainly dominated by the organized sector and consists of

four major

players who together account for almost 85% of the industry`s turn over- MRF Ltd.,

Apollo

Tyres Ltd., JK Tyre &Industries Ltd. and Ceat Ltd.

Unlike the international tyre industry where passenger car radials dominate the

market, in the

Indian tyre industry commercial vehicle tyres take the lead and account for

approximately 70%

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of the industry`s turnover. As a result, the growth of the entyre industry depends

upon primary

factors like agricultural growth, industrial production, growth in vehicle demand and

secondary

factors like infrastructure development, prevailing interest rates and financing

options.

The tyre industry is highly raw material intensive and a major consumer of rubber.

With raw

material costs accounting for 70% of the cost of production, any change in the price of

rubber or

the crude basket has a direct impact on the cost of production. The comparatively

stable raw

material prices in the first half of FY 2007-08, coupled with price rises undertaken by

the

industry in FY 2006-07, resulted in all major players reporting improved operating

profit margins. This was after a four consecutive years of raw material cost push, both

for natural

rubber and crude oil linked raw material basket. The second half of FY 2007-08, saw

an upward

trend for all major raw material prices and the same is anticipated in the year ahead.

As a result

margins are once again under pressure, even while the demand-supply situation

continues to be

in favor of the industry.

The industry, already bogged by over capacity, is facing a severe threat of dumping of

cheap

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tyres by South Korea. Under the Bangkok agreement, signed between India and South

Korea in

1976, import of tyres from the latter into India would attract a concessional duty of 33

per cent as

against the normal tariff of 40 per cent. Two years ago, the industry estimated the

growth in the

passenger car radial demand at 20 per cent per annum. However, the auto recession

has hit them

badly. But South Korea made a killing by dumping cheap car radial tyres and walked

away with

11 per cent of the tyre market.

Another threat to the industry is the price of its raw materials, most of which are

petroleum byproducts.

Carbon, synthetic rubber and nylon tyre cord are offshoots of petrochemicals. Thus,

the

future of the industry will swing with the supply of crude oil.

The biggest threat, however, is yet to fully materialize. It will be from global majors

like

Bridgestone and Michelin, which control 36 per cent of the global tyre market. These

players

have set up their bases in Southeast Asia and the slump of the markets in this region,

coupled

with the vast growth potential of the Indian market, is beckoning them towards India.

Bridgestone has tied up with ACC for a 100 per cent radial tyre unit and Michelin is

also

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marketing its products through retail outlets. The industry is driven more by volumes

than by

margins and each of the big five in the global tyre industry Continental, Michelin,

Goodyear,

Pirelli and Bridgestone generate an annual tyre production equivalent to the total

demand of the

Indian market. These MNCs have deep pockets and can easily withstand losses for 2-3

years.

Their financial muscles also permit them to invest in R&D, which is beyond the reach

of the

average Indian tyre manufacturer.

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COMPANY PROFILE

Just one year before the attainment of independence by our country in the year 1946,

a young

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entrepreneur Mr.K.M.Mammen Mappillai opened a small toy balloon manufacturing

unit shed at

Thiruvottiyur, Madras (now Chennai). Over the year it started manufacturing a variety

of products.

MRF Ltd. was incorporated towards the end of 1960 and was converted into a public

limited company in 1961. Additional shares were offered to the public, in order to

raise fund formanufacturing automotive tyres and tubes in collaboration with US

based Mansfield Tyre and

Rubber Co. Since then it has emerged as the largest tyre manufacturer in India and

13th largest in

the world with a turnover of Rs.5000 crores and also built capacity of six million tyres

from six

production facilities in India. With a profit margin of approximately 1.3% in the tyre

manufacturing sector, MRF holds more than 20% of the market share. The company

caters to all

vehicular segments from commercial vehicles and passenger cars to 2-3 wheelers and

tractors

and has a strong presence in both radial and cross ply segments. It hosts 68 sales

centers, 2500

distributors and exports to over 75 countries: A standing testimony of MRF`s

outstanding

leadership.

MRF enjoys of manufacturing the largest range of tyres in India and it has the highest

brand

preference for superior quality, appearance and wears ability. It manufactures the

largest range of

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tyres in the country and is the market leader with the largest market share in almost

every

segment of the tyre industry.

MRF Ltd. is the first Indian company to export tyres to the US, the very birthplace of

tyre

technology. It is the first company in India to manufacture and market Nylon tyres

passenger

tyres commercially. The company was given the title of most ethical company by

'Business

World' magazine after a survey conducted in 1999.

VISION

MRF TYRES Ltd. has a vision- a vision to be a significant player in the global tyre

industry and

a brand of choice providing customer delight and enhanced stakeholder value. And in

order to

make empower vision, they have strived to meet the needs of the customers through:

To be most admired Tyre Brand – Globally by 2010. Error- free service delivery Innovative products and services Cost efficiency Loved by more customers Targeted by top talent Benchmarked by more business

MISSION

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MRF `s mission statement is as follows: “We will meet global standards of the

tyre industry

that delights customers through customer service focus, empowered employees,

innovative

services & Cost efficiency.

VALUES

Customer: We bill be responsive to the needs of our customer’s. Learning: We will continuously improve our service innovatively & expeditiously. People: We will trust & respect our employeesCommunity & Partners: We will be transparent & sensitive in our dealing with all stake holders.

BACK GROUND OF COMPANY

The success or the failure of a company is by the performance of its management.

Management

plays a major role in decision making. The management of MRF id led by

Mr.K.M.Mammen,

son of Mr. Mammen Mappillai who started the company 62 years ago.

BOARD OF DIRECTORS

K.M. Mammen ChairmanArun Mammen Managing DirectorK.M.Pillai Whole Time DirectorDr. K. C. Mammen DirectorC.G. Rangabashyam DirectorK.D. Prakh DirectorAshok Jacob Director

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S. Nandhagopal DirectorV. Shridhar DirectorVijay .R. Kiriloskar DirectorN. Kumar DirectorRanjith. I. Jesudasen DirectorD.M. Choksi Secretary

MAJOR BRANDS Superlug - Country`s largest selling Truck Tyre. Shakthi- Country`s largest selling Tractor Tyre. Zigma- Country`s largest selling Radial Car Tyre. Nylogrip- Country`s largest selling Two Wheeler Tyre. Legend- Country`s largest selling Conventional Car Tyre.

SISTER CONCERNS Malayala Manorama Manorama Vision MM Foam Philips Coffee Devon Machines Plantation COLT Computers

INDIAN COMPETITORS TO MRF Ceat Apollo Good Year J K Tyres Modi Bridgestone

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PRODUCT PROFILE

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COMPANY`S PRODUCTS

Automotive TyresTruck tyres – tube type and Tube less type Light Truck Tyres Special Tyres for Defense Tyres for industrial application Agricultural Tractor and Tilling tyres Off the road tyres- solid tyres and earth mover tyres Passenger tyres- bias ply and radial Two/Three wheeler tyres Specialized tyres for motor rallies

Major Tyre Brands of MRF

Superlug - Country`s largest selling Truck Tyre. Shakthi- Country`s largest selling Tractor Tyre. Zigma- Country`s largest selling Radial Car Tyre. Nylogrip- Country`s largest selling Two Wheeler Tyre. Legend- Country`s largest selling Conventional Car Tyre Paint and Specialty Coating

MRF manufactured speciality coating for a wide range of application. The

revolutionary 100% polyurethane finishes are available in formulation for application

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to metal, wood, plastic, paper, vinyl, textile, ceramics and glass. These coatings have

been developed for color and gloss retention, strong adhesion and durability.

Major MRF Paints and Speciality Coatings

MRF Metal Coat MRF Wood Coat MRF Glass Coat MRF Vapocure MRF Brass Coat MRF Auto Coat

Funskool ToysFunskool India Limited is a joint venture between MRF and Hasbro Inc., USA, the

world`s largest toy company. Since late 1991-1992 Funskool` s Goa plant has been

making its own moulds for a number of its products, the most popular of which are

Pipsqueaks, a range of low priced baby toys. These soft colorful animal toys have their

sound built into their internal construction, doing away with the traditional whistle that

breaks easily.

Funskool` s range of board games has catalyzed the phenomenal growth of this

segment in the Indian toy market. Games like Scotland Yard, Battleship, The Game of

Life, The Memory Game, and the recently launched Go to the Head of the Class have

made Funskool the undisputed market leader in the board games segment. The G. I.

Joe series of army action figures and vehicles, which has taken the children`s world by

storm has gone up to a collection of 30 figures and 20 vehicles. Two new toys, the

racing jeep and the Street Hawk motorcycle are based on MRF ads. The latest to the

Funskool range of toys are the WWF characters.

MRF Muscleflex Conveyor Belt

MRF`s collaboration with PIRELLI came at a time when Indian Conveyor belting

industry was seeking technological momentum.MRF Muscleflex offers several

advantages to buyers of belting in India.

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The MRF Conveyor Belt plant is in Arakonam, Tamil Nadu, with an annual capacity of

3000 tonnes, is the most modern belting plant in India and is dedicated to the

development or manufacture of the finest Conveyor and Elevator Belting products.

The plant integrates a high degree of polymer /textile technology with definitive

standards in process control/product testing, employing the latest in conveyor belt

manufacture. MRF Muscleflex conveyor belting brings international expertise and

reliability.

MRF Pretreads

MRF Pretreads is the most advanced Pre cured Retreading system in India. MRF made

a foray in retreading as far back as 1970. Today, MRF has perfected the art of pre

cured retreading with their extensive knowledge in tyres and rubber.

In the MRF Pretreads system, the tread rubber is pre cured from MRF's factory under

carefully controlled conditions, thereby ensuring you get world class quality. Today,

MRF Pretreads has emerged as the Mileage leader in Pre cured Retreading and also

has the specialized expertise required for retreading Radial Tyres.

OTHER ACTIVITIES

MRF Pace Foundation

The MRF Pace Foundation was established in August ‘1987, with the legendary Dennis

Lillie of Australia as Director, with the singular mission of developing and breeding

strike bowlers of tomorrow.

A brain child of late Mr. Ravi Mammen, the birth of this foundation coincided with one

of the greatest events in Indian cricket-the hosting of ‘MRF World Series’ for the first

time in the sub-continent. This marked a significant forward step in Indian Cricket. The

MRF Pace Foundation is unique in its nature and objective. It selects nurtures and

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scientifically develops the cricketing skills of youngsters. When it was started it

possessed very little facilities other than an unused ground on the Madras Christian

College campus. Since then, under the stewardship of Dennis Lillie and the able

guidance of Chief Coach T.A. Sekar, former Indian Pace Bowler, the MRF Pace

foundation has come a long way.

Racing and RallyingMRF is pioneer is a pioneer of motor racing in India. Every MRF tyre designed is a

result

of a special acid test on the race and rally tracks: Sharp turns, abrupt braking, straight

stretches of streaming asphalt, excruciating conditions. MRF tyres are made to run at

speeds exceeding 150kmph, at which they are exposed to extreme conditions of heat

and

land traction. The molecular stability of the rubber compounds is tested against severegravitational stress. Experts observe, analyze and gather information at the pits and

the dirt track, which they pass on to the R&D department. This is then reviewed and

used to develop safer, better quality tyres not only for formula racing cars that rough

it but out on the tough Indian roads every day.

MRF Powerhouse

The MRF Powerhouse speaks of commitment to raising Indian motor sports to

international standards. It provides MRF`s dedicated team of skilled motor racers, an

environment that brings out the best in them. It creates winning opportunities by

providing state of art racing equipment that maximizes the output of both man and

machine.

AREA OF OPERATION Automotive Inner Tube

This component is kept inside the tyre and which when inflated renders strength and

impacts profile to the tyre.

Automobile Tyre

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This is the basement on which the whole superstructure of automobile rests. Here

only

conventional or bias tyre of passengers, jeep, truck and farm tyres are manufactured.

Rethreading Material

Both conventional and procured tread rubber are manufactured here. While the

conventional tyre requires a longer curing time, in case of PCTR , molded tread profile

is

kept on the top of the worn out tyre and pressurized, with the intermediary of steam.

Flap

This is kept in between the tubes and the tyre. This serves as a protective sheath for

the

tube from external damages of the tyre and also as isolation medium, which filters the

passage of the heat from the tyre to the tube. This is generally used for the bigger

tyre.

Different tyres of flap with valve block reinforcement are also being tried out.

Bladder

This is an element used for curing of tyre, which carries the internal media and is

mainly

used for captive consumption.

Envelopes

These are made of chlorobuty and are used at the time of retreading tyres. This acts

as an

envelope and retains the thermal input supplied to the tyre.

Vulcanizing Solution

This is an aid for vulcanization and is used for the retreading of tyre

PRODUCTION UNITS Thiruvottiyur, Tamil Nadu

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Arakonam, Tamil Nadu Kottayam, Kerala Medak, Andhra Pradesh Pondicherry Ponda, Goa

MAJOR OEM (Original Equipment Manufacturers) CUSTOMERSOF MRF (Tyres & Tubes): Ford India Ltd. General Motors India Ltd Maruti, Hindustan Motors Hyundai, TATA Motors Asok Leyland Honda Siel Hero Honda Bajaj LML Ltd. Honda Motors & Scooters India Ltd. Mahindra & Mahindra Eicher Motors New Holland Volvo

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EVOLUTION OF MRFIN 1949 ,MRF established its first office at 334, Thambu Chetty Street, Chennai.

IN 1952 , The first machine (a rubber mill) was installed at the factory and MRF

ventured into

manufacture of tread rubber.

IN 1955 , MRF started competing with foreign companies operating in India by

becoming the only Indian company to manufacture superior, extruded, non

blooming and cushion backed

tread rubber.

IN 1956 , MRF became the market leader in tread rubber with 50% share in the

Indian market.

MRF`s hold on the market was so strong that the foreign companies started

withdrawing from the tread rubber business in India.

IN 1961 ,MRF became a public limited company.MRF entered into technical

collaboration with

Mansfield Tyre Company of USA and a pilot plant for tyre manufacture was

established at Thiruvottiyur.

IN 1963 , Full fledged tyre plant and rubber research center was inaugurated by

India`s first Prime Minister Pandit Jawaharlal Nehru.

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“With the manufacture of tyres, MRF started marching ahead, capitalizing on its

strengths,

overcoming its weaknesses, exploring all opportunities and converting every threat

into an

opportunity for growth.”

IN 1964 , MRF started an overseas office in Beirut (Lebanon)to develop export

market.

IN 1967 , MRF becomes the first Indian company to export tyres to USA which is the

birth place of tyre technology.

IN 1970 , Kottayam plant became operational.

IN 1971 ,Goa plant was built in a record time of 18 months.

IN 1972 , With the setting up of Arakonam plant, MRF became the only tyre company

in India with four manufacturing facilities.

IN 1973 , MRF launched India`s first NYLON car tyre.

IN 1978 , MRF launched Super Lug 78 which later became the largest selling truck

tyre in India.

IN 1979 ,MRF`s turnover crossed Rs.100 crores

IN 1980 , MRF entered into technical collaboration with BF Goodrich Tyre Company

of USA. With this began a significant exercise in quality improvement and new product

development.

IN 1984 , MRF becomes the first tyre to be selected for fitment on Maruti-800

IN 1985 ,MRF Nylongrip tyres for two wheelers were launched.

IN 1986 , MRF won 6 awards for quality improvement from BF Goodrich, pitted

against 20 tyre

companies worldwide. It also won the National Institution for Quality Assurance Award

in the same year.

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IN 1987 , MRF became the No.1 tyre company in India by crossing the Rs.300 crores

turnover.

IN 1988 , MRF Pace Foundation was setup with Dennis Lillie as its director to nurture

and develop the talents of budding cricketers. It concentrated on developing pace

bowlers and within

a few years it contributed pace bowlers to the Indian Cricket Team.

IN 1989 , MRF collaborated with the world`s largest toy maker, Hasbro international

and launched Funskool India, the most modern toy project in Asia. MRF collaborated

with Vapocure of

Australia to produce poly-urethane paint formulations. MRF Zigma radials

werelaunched along with MRF World Series cricket which was one of the country`s

most spectacular cricketing and marketing events.

IN 1990 , The fifth unit of MRF for manufacturing tyres and tubes was opened at

Medak in Andhra Pradesh.

MRF Tyre Drome became India`s first tyre company owned Wheel Care Complex. MRF

collaborated with Pirelli to manufacture conveyor belts called Muscle Flex. The same

year MRF brought the World Cup Boxing Championship to India. In this year the

company bagged the Vishveshvariah Award for the best business house in South

India. It also bagged the Howard Business school Award for best corporate

performance.

IN 1991 , MRF moved to its own corporate office which soon became a landmark in

Chennai.

IN 1993 , MRF became the first Indian tyre company to cross a turnover of Rs.1000

crores. With

this the company found a place among the ten most respected corporate groups in

India. “It was a proud moment for the company when it’s Founder and Chairman

Mr.K.M.Mammen Mappillai was honored with the “PADMASHREE” award for his

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contribution to the industry, the only industrialist from South India to be accorded this

honor.”

IN 1996 , In the Golden Jubilee year, the company crossed a turnover of Rs.2000

crores and also setup a new plant at Pondicherry for manufacture of radial tyres.

IN 1999 , MRF was declared the most ethical company by the “Business World” in its

survey.

IN 2000 , MRF launched the smile campaign on Indian roads.

IN 2002 , MRF won the No.1 award for customer satisfaction by J.D.Power, Asia

Pacific.

IN 2003 ,For the second year in succession, MRF won the No.1 award for customer

satisfaction byJ.D.Power, Asia Pacific.

IN 2004 , For the third year in succession, MRF won the No.1 award for customer

satisfaction by

J.D.Power, Asia Pacific. The company crossed a turnover of Rs.3000 crores.

IN 2006 ,For the fourth time, MRF won the No.1 award for customer satisfaction by

J.D.Power,

Asia Pacific.

AWARDS AND ACHEIVEMENTTNSMRF voted the "Most Trusted" Tyre company in Indiaby TNS 2006 global CSR study.J D POWER ASIA PACIFICMRF won the award forCustomer satifaction not once but 6 times in the last 7 years.CAPEXILMRF won the award for exports.

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POLICIES OF MRF

QUALITY POLICY OF MRF

This policy is to maintain market leadership through continuous quality improvement.

To

achieve this goal, all the MRF plants and the corporate office particular attention to

the

following:

Product/process improvements by field/plant performance monitoring and prompt

service

to the customer.

Up gradation of machinery to meet the increasing needs of the customer.

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Continuous training of all employees in order to acquire necessary skills and

knowledge.

At the Plant level the respective General Managers are assigned the responsibility

of

carrying out quality systems by collaborating with corporate functions.

SAFETY POLICY OF MRF

MRF has a well defined safety and health policy which is as follows:

“It is the policy of our company that the SAFETY and HEALTH of our employees shall

be our

FIRST priority.

It is the responsibility of everyone in the organization, regardless of the position he

occupies to

ensure that everyone in the factory returns home to their beloved ones without any

injury today

and every day.

We shall observe this policy not only in letter but also in spirit and offer “ACCIDENT

FREE

SAFE PRODUCTION” for the benefit of one and all.”

ENVIRONMENTAL POLICY OF MRF

This policy of MRF is to ensure that products are manufactured in an environment

friendly and

safe manner. To achieve this goal, all the MRF plants and the corporate office

particular

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attention to the following:

Minimize the impact of manufacturing activities on the environment-air, water, soil.

Comply with all applicable regulatory requirements.

Develop environmental performance evaluation procedures for continuous

monitoring.

Optimize the consumption of resources (water, energy and raw materials) by

minimizing

wastage, recovering and recycling where ever possible.

Up gradation of machinery and pollution control equipment when required.

Train all employees to perform their activities in an environmentally responsible and

safe

manner.

TRAINING POLICY OF MRF

This policy is to provide and develop knowledge, skills and behavior of the employees

to

continuously improve performance. To achieve this goal the following are paid proper

attention:

Identify and document the training needs of each employee through competence

evaluation each year.

Design and publish training calendar and schedule.

Providing training periodically based on identified needs and as per the documented

schedule.

Monitor and evaluate the training process and outcomes to asses and to decide the

next

training cycle requirements.

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CURRENT POSITION

Highlights of First Quarter (Dec 2007): FY 07-08 Turnover (Rs. in crores) : 1155.57 Net Profit (Rs. in crores) : 51.75 EPS (in Rs.) : 122.03 Operating Profit (Rs. in crores) : 127.92

Highlights of Second Quarter (Mar 2008): FY 07-08 Turnover (Rs. in crores) : 1214.83 Net Profit (Rs. in crores) : 65.62 EPS (in Rs.) : 154.72 Operating Profit (Rs. in crores) : 154.39

FUTURE GROWTH PROSPECTS

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ORGANIZATION PROFILE: KOTTAYAM PLANT

Kottayam plant was started as a small masticating unit towards the end of 1969; the

first machine

was a 3A banbury (a small internal mixer) with a mixing capacity of about 66kgs per

batch.

Later automotive tube production started in1971. The mixing capacity of the unit was

increased

with the introduction of 11A and 11D banburys. Later, tread rubber and a host of tyre

repair

materials were also produced. Kottayam became a supplier of mixed compound to

other units of

MRF. Pre cured tread rubber was also added to the product range of Kottayam unit.

The commissioning of the tyre plant in 1994 was the beginning of a new era in the

history of the

Kottayam unit. This marked the starting point of a massive expansion drive at

Kottayam. Initially

tractor front tyres were produced and then it diversified into passenger tyres, tractor

rear and

truck tyres of various sizes. Cement house was also built to prepare various cements

and paints

required at tyre plant and also for the production of vulcanizing solution.

With the commissioning tyre plant, PCTR production was also increased with more

PCTR

curing presses being commissioned. Flap production was started in tyre plant initially

with two

presses and later increased to six. (PCTR and Flap presses were later shifted to PCTR

plant when

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the new plant was commissioned)

Kottayam plant supplies mixed rubber to other plants of MRF and hence with the

increase in

demand, it became essential to augment the mixing capacity of the plant. A new plant

exclusively for mixing was built with huge internal mixers (banburys) which have

automatic

carbon and oil charging facilities. It houses two banburys of P270 type and one

banbury of F620

type. With a mixing capacity of 600 tons per day, this is one of the largest mixing

units in Asia.

A BD (broken down rubber) mixing unit was also built to ensure self sufficiency in BD

production since BD mixing was earlier being done in outside mixing units. The

outside mixing

units operated with open mills and hence batch to batch consistency was low. With

the mixing of

BD in the banburys at the BD plant better consistency could be achieved in properties

of broken

down rubber. BD mixing unit has two 11D banburys and two extruders to sheet out

the mixed

rubber.

A new plant, mainly for PCTR production was commissioned in the year 2000. This

plant now

houses a 6” cold feed extruder for extruding, rethreading materials and PCTR slugs,

PCTR

curing presses, 48”calendar for production of tyre repair materials, 68”fabric

calendar, German

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tuber for flap slug extrusion, flap curing presses, tyre finishing and repair, tyre clinic,

textile lab,

finished goods storage and shipping.

With the growth in the number of tyre presses and subsequent increase in the

requirement of

bladders (Supplied by other units of MRF), Kottayam unit started producing bladders

for its use

and also for supplying to other units. The bladder press is located in tube plant.As a

new product,

solid tyre production was introduced at Kottayam in 2004. The solid tyre presses are

located in

the tube plant.

KOTTAYAM PLANT – FACTS AND FIGURES (Sept 2007)

Built up area : 6 lakh sq.feet Management Staff : 252 Regular Workmen : 1,115 Casual Workmen : 399 Total finished goods production : 3,400 MT/month Total turnover of finished goods : Rs.37 crores/month Mixed stock sent to other units : 7,000 MT/month Tyre Production : 52,000 tyres /month Tubes, envelopes and curing bags total production : 2,63,000 /month Flap Production : 82,000 /month Tread rubber production (conventional) : 160 MT/month PCTR production : 330 tonnes/month Repair Material : 83 tonnes/month Vulcanizing solution : 32,500 litres/month

INTERNATIONAL CERTIFICATIONS FOR KOTTAYAM PLANT ISO 9001 in the year 2000 ISO 14001 in the year 1996

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CQC

MANAGERS AT THE KOTTAYAM PLANT

Mr. Michael Ribeiro General Manager

Mr. Saji Varghese Plant Production Manager

Mr. Francis Mathew Plant Engineering Manager

Mr. C.S Joy Plant Technical Manager

Mr. Cherian Zachriah Plant Quality Assurance Manager

Mr. Anil Petre Plant Accounts Manager

Mr. Simon C.P Plant Human Resources Manager

Mr. Raghuram Plant Industrial Engineering Manager

Major. Sivadasan Security Officer

Mr. K.M Anil Kumar Safety officer

Production is the primary function of MRF and hence all other functions are supporting

functions. Production is carried out in four plants in Kottayam unit. They are:

Tube Plant called Plant1 Tyre Plant called Plant2 Mixing Plant called Plant3 PCTR Plant called Plant 4The following are the main functions of the production department:

Planning for Production Process

Every month a plan is given to the plant by the central planning department, the plant

panning department will prepare a simulation plan by dividing the month into

3segments of 10 days each. This simulation plan is taken as the guideline for each

plant to plan their production process. The available inventory and the priority of

dispatch are taken into consideration while preparing the daily schedule. Slight

changes are made in the simulation plan to obtain the objective and improve

production efficiency.

Material Request and Receipt

The daily requirement of raw material is calculated at each plant after considering the

available inventory and the scheduled production of the next day. The raw material

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requestis made to the raw material store. Raw material store makes arrangements to

deliver the requested material to the plants. The receipt of material is acknowledged

by the production department to the raw material store by the production signing on

all the copies of the transfer or issue certificates. In case of in process material,

request is given 1-3 days in advance to the concerned plant which produces the

material.

Processing

Processing is carried out as per the technical specifications of the BSP (Basic Standard

Practice) and the work instructions of the respective department. Set up verification is

done for each product and each run. Once the process is stabilized, the process

parameters are checked and recorded. If the parameters are as per specification

process is continued, else the necessary correction is made and the process is

resumed.

Production department ensures that all necessary instruments and equipments are

calibrated by checking the calibration sticker on the instrument. Cases where the

instruments are overdue are for calibration is overdue are reported to the

instrumentation department through AVO (Avoid Verbal Order). The supervisor stops

usage of such equipments depending on the criticality of system violation. Whenever

machines stop or behave abnormally the engineering department is informed and a

maintenance request is made.

Product Identification and Traceability

The objective of product identification and traceability is to prevent mix up of

products and

to ensure traceability of products at various stages. This applies to raw materials, in

process

materials and finished goods.

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Specific ways of identifying each material at each stage is defined. For example, in

case of

extruded tubes, details like size, month code, year code, plant code, date of extrusion,

extruder operator code are printed.

In the case of traceability, for example, while extruding treads, the details of stock

(stock

code, date and shift of mixing, batch numbers) used for extruding those treads are

entered in

the traceability register.

Inspection

Inspection is done to ensure that the materials, equipment, storage area are free from

any

contamination.

MRF Kottayam unit produces:

9202 Tubes per day

1750 Tyres per day

50 Solid tyres per day

8MT Tread rubber

2300 Flaps per day

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MRF Sales NetworkNORTH SOUTH EAST WESTNew Delhi Chennai Kolkata MumbaiAgra Ananthpur Asansol AhmadabadBareilly Bangalore Cuttack AurangabadBikaner Belgaum Dhanbad BarodaChandigarh Calicut Guwahati BhopalFaridabad Coimbatore Muzaferpur GoaHaldwani Ernakulum Patna IndoreHissar Hubli Ranchi JabalpurJaipur Hyderabad Siliguri JodhpurJalandhar Madurai NerulS.V DEGREE COLLEGE,BIDAR Page 42