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5. Anand Automotive Limited Business Report FY ended Mar. 2020

Anand Automotive Limited Business Report FY ended Mar. 2020

Financial Overview (FY ended March 31, 2020)

Gabriel India Limited
-Gabriel India's sales for the fiscal year ended March 31, 2020 decreased by 9.7% to INR 18,543.1 million against INR 20,523.7 million in FY 2018-19. It reported a 22.5% decline in EBITDA. Profit after tax of the Company was pegged at INR 847 million compared to INR 950 million in FY 2018-19. During the year under review, the company encountered sustained automotive industry headwinds. The sector prepared for the transition to BS-VI norms, which affected offtake across segments. The impact of the global pandemic COVID-19 eroded revenues in the last 10 days of March 2020.  

Joint Ventures/ Partnerships

-In February 2020, the Company Group and MAZARO, Belgium announced technical alliance to bring out innovative solutions suited for reducing emissions. The technology has the potential to reduce consumption of energy in ICE and EVs by up to 18%. The Group estimates a potential revenue forecast of around INR 3.5 billion by 2025.

-In February 2020, the Company Group announced collaboration with FAR-UK for carbon fiber composites. The product has the potential for light weighting in vehicles by almost 50%, with strength matching that of high strength alloy steel at the weight of aluminum. They estimates a potential revenue forecast of around INR 6 billion by 2025.

-In December 2019, the Company Group informed that Henkel ANAND will drive the strategic ‘Mobility Alliance’ between the Germany based Henkel and RLE International in India. The two partners, with clear synergies in their business objectives, will harness the Power of Partnership by uniquely combining advanced material science with engineering expertise. The partnership will develop next generation design solutions and new levels of lightweight structures.

-In October 2019, the Company Group ended its joint venture with Federal Mogul after it got acquired by multinational firm Tenneco.

Business Partnerships

-The Group has business Joint venture and partnership with following companies 

Contracts

Gabriel India Limited
-During the year ended on March 31, 2020, Gabriel India has commenced manufacture of Honda scooter front forks by setting up a facility in Sanand, Gujarat. It has also extended complete support for the timely launch of Maruti Suzuki S-Presso. For commercial vehicle segment, it has received a letter of intent to supply parts to DAF Netherlands. It also developed high damping force technology products (with support of technology partner KONI) for the MBP platform of Ashok Leyland.

Awards (FY ended March 31, 2020)    

Outlook

Gabriel India Limited
-Gabriel India said that the outlook for FY 2020-21 appears uncertain and depends on the effectiveness with which the pandemic can be controlled. However, it will steadily continue to pursue its vision ‘To be amongst the Top 5 shock absorber manufacturers in the world’ by 2025. It will continue to focus on qualitative and technological upgradation, improve line efficiency and human productivity. It will continue its thrust on cost optimization and quality enhancement to make strong position to enter global platform and deliver FTR (first time right) and ETR (every time right) for export programs for which SOP has been planned during FY 2020-21. 

Anand Group
-Anand Group strategic goal is to achieve revenue of USD 2.5 Billion by 2022.

Technological Alliance

–During the fiscal year 2019-20, Anand Group announced technical alliance with MAZARO, Belgium to bring out innovative solutions suited for reducing emissions and to bring out innovative solutions suited for reducing emissions. Other Technological Alliance of the group are as below:    

R&D Expenditure (in million INR)

Gabriel India Limited

R&D Structure

Gabriel India Limited
-During the fiscal year ended March 31, 2020, Gabriel India Limited announced that a modern R&D setup focused on passenger cars, commercial vehicles and railways is being developed at Chakan, Pune in FY 2020-2021. New technologies for cars, CVs and high-speed railway coaches are being developed to support modernization programs. The new facility will support new product development that meet customer specific current and future needs, in house designed and developed products with 100% local content, design optimization to reduce consumption of natural resources and use of Eco-friendly green technologies.

R&D Activities

Gabriel India Limited
-The following are specific areas of R&D that Gabriel India focused on in the fiscal year ended March 31, 2020:

• Advanced suspension technologies for enhanced user experience
• CO2 footprint reduction by product light-weighting and use of green technologies
• Road load data acquisition of struts and dampers to improve quality & optimize
• Virtual analysis (FEA) of structural components for stress analysis and durability products
• Implementation of PLM to increase reuse of existing components and to improve productivity
• Joint ride tuning with OEMs to improve ride and handling of vehicle before launch

Investments in India

SPICER India
-On February, 2020, the Company inaugurated an Electric Vehicle Drive Head manufacturing line at Chakan Plant.

CY Myutec ANAND
-On September 2019, CY Myutec ANAND (CYMA), Chennai plant inaugurated a new building.

Gabriel
-During the financial year 2019-20, Gabriel India’s two and three-wheelers business unit set up a manufacturing facility in Sanand to support Honda Motorcycle and Scooter India.

MAHLE ANAND Thermal Systems
-In November 2019, MAHLE ANAND Thermal Systems inaugurated new plant in Pune. The plant will have a workforce of 120 people. The new plant (also called Plant II) has been built as part of the special project ‘LIFT’ which stands for Lean production, Industry 4.0, Fit for Safety and Transformation. Plant II will specialise in HVAC production lines. Plant II is expected to contribute around 25% of the total revenue of MATS, and will feed four key customers, viz. Volkswagen, Mahindra, Tata Motors and VE Commercial Vehicles.

Impact of Covid-19

-Gabriel India performance may get hampered due to COVID-19 outbreak which has put the country under lockdown for few months. The pandemic has also damaged the sentiments of consumers which may affect the performance of the company in FY 2020-21. The outlook for FY 2020-21 appears uncertain and depends on the effectiveness with which the pandemic can be controlled. The Company is continuing with its Capital projects which are in advanced stages of completion and does not foresee any immediate concerns towards their completion. Due to Covid-19,  Anand Group skipped annual increments due in the beginning of 2020 and collectively decided to opt for salary cuts on a graded scale with higher cuts ( including variable pay ) at higher levels of management like the ANAND Executive and Management Committees and the ANAND Supervisory Board. Various ANAND Group plants across India have resumed operations post the COVID-19 lockdown.