Munjal Showa Limited- Financials

Munjal Showa Limited- Income Statement

INR Mn except EPS FY'11 FY'12 FY'13 FY'14

Revenue
Net Sales 12893 15568 15814 15979
Other income 23 16 35 61
Total Revenue 12916 15584 15849 16040
Expenses
Cost of raw materials consumed 9698 11636 11765 11943
Purchases of stock in trade 0 0 0 0
Change in inventories of finished goods, work in progress and stock in trade 7 -46 22 -55
Employee benefit expense 547 665 766 880
Other expenses 1831 2086 2208 2158
Operating expenses 12083 14341 14761 14926

Earnings before interest, taxes, depreciation, amortization (EBITDA) 810 1227 1053 1053

Depreciation & Amortization 262 272 276 284

Earnings before interest & taxes (EBIT) 571 971 812 830
Finance costs 91 112 72 27
Profit before tax & exceptional items 480 859 740 803
Exceptional items 0 0 -61 0
Tax expense 139 187 72 101
Net Profit for the year 341 672 607 702
Earning per share (EPS) Face value 2 8.5 16.7 15.1 17.4

Workings
Current market price of share 160.8
Common shares outstanding 39,995,000
Market value of equity (Rs. in million) 6431.196
Minority interest 0
Debt 0
Cash & Bank balance and current investments 695
Net debt (Rs Mn) -695
Enterprise value (Rs Mn) 5736

Document Classification: KPMG Confidential

 Munjal Showa Limited- Balance Sheet

FY'15 INR Mn FY'11 FY'12 FY'13 FY'14 FY'15

Equities & Liabilities
16429 Shareholders funds
81 Share capital 79 79 79 79 79
16510 Reserves & Surplus 1949 2482 2948 3481 4027
Shareholders funds 2028 2561 3027 3560 4106
12144 Non Current Liabilities
0 Long term borrowings 519 211 0 0 0
-25 Deferred tax liabilities (net) 139 142 142 118 85
924 Long term provisions 6 6 7 15 25
2120 Other long term liabilities 0 0 53 0 0
15163 Non Current Liabilities 664 359 202 133 110

1266 Current Liabilities

286 Short term borrowings 54 200 0 0 0

1061 Trade payables 1637 1686 1508 1656 1552
4 Other current liabilities 378 393 391 158 106
1057 Short term provisions 188 182 191 234 252
7 Current liabilities 2257 2461 2090 2048 1910
307 Total liabilities & equity 4949 5381 5319 5741 6126
757 Assets
18.9 Non current assets
Fixed assets 0 0 0 0 0
Tangible assets 2513 2427 2439 2309 2092
Intangible assets 32 22 20 19 18
Capital work in progress 85 112 74 5 17
Intangible assets under development 0 0 0 0 0
Non current investments 0 0 0 0 0
Long term loans & Advances 35 34 382 440 394
Other non current assets 8 2 0 1 1
Non current assets 2673 2597 2915 2774 2522
Current assets
Current investments 0 30 200 300 680

Inventories 367 491 399 493 665

Trade receivables 1429 1759 1416 1768 2033
Cash & bank balances 31 47 179 155 15
Short term loans & Advances 369 371 186 208 174
Other current assets 80 86 24 44 38
Current assets 2276 2784 2404 2968 3605
Total assets 4949 5381 5319 5742 6127

Document Classification: KPMG Confidential

Gabriel India Limited- Financials

Gabriel India Limited- Income Statement

INR Mn except EPS FY'11 FY'12 FY'13 FY'14

Revenue
Net Sales 9699 11282 12053 12866
Other income 93 74 40 56
Total Revenue 9792 11356 12093 12922
Expenses
Cost of raw materials consumed 6949 8069 8689 9321
Purchases of stock in trade 18 28 41 44

Change in inventories of finished goods, work in progress and stock in trade -61 -24 -86 -99

Employee benefit expense 700 794 910 982

Other expenses 1204 1495 1672 1713
Operating expenses 8810 10362 11226 11961

Earnings before interest, taxes, depreciation, amortization (EBITDA) 889 920 827 905

Depreciation & Amortization 219 276 272 270

Earnings before interest & taxes (EBIT) 763 718 595 691
Finance costs 171 170 122 89
Profit before tax & exceptional items 592 548 473 602
Exceptional items -17 77 -59 -42
Tax expense 122 93 30 131
Net Profit for the year 453 532 384 429
Earning per share (EPS) Face value 1 6.3 7.4 2.6 2.9

Workings
Current market price of share 76.9
Common shares outstanding 143,643,940
Market value of equity (Rs. in million) 11046.2
Minority interest 0
Debt 58
Cash & Bank balance and current investments 38
Net debt (Rs Mn) 20
Enterprise value (Rs Mn) 11066

Document Classification: KPMG Confidential

 Gabriel India Limited- Balance Sheet

FY'15 INR Mn FY'11 FY'12 FY'13 FY'14 FY'15

Equities & Liabilities
14440 Shareholders funds
43 Share capital 72 72 144 144 144
14483 Reserves & Surplus 1793 2240 2424 2708 3111
Shareholders funds 1865 2312 2568 2852 3255
10319 Non Current Liabilities
100 Long term borrowings 562 246 164 96 58

12 Deferred tax liabilities (net) 157 133 111 96 105

1075 Long term provisions 53 30 57 41 93

1769 Other long term liabilities 36
13275 Non Current Liabilities 772 409 368 233 256

1165 Current Liabilities

311 Short term borrowings 678 662 497 469

897 Trade payables 1467 1411 1391 1578 1907
55 Other current liabilities 401 468 557 454 411
842 Short term provisions 115 118 195 291 335
-6 Current Liabilities 2661 2659 2640 2792 2653
235 Total Liabilities & equity 5298 5380 5576 5877 6164
601 Assets
4.2 Non current assets
Fixed assets
Tangible assets 2024 2059 2498 2635 2655
Intangible assets 76 79 56 36 21
Capital work in progress 108 37 64 125 31
Intangible assets under development
Non current investments 133 0.2 0.2 0.2 0.2
Long term loans & Advances 414 377 298 232 226
Other non current assets 24
Non current assets 2755 2552.2 2916.2 3028.2 2957.2
Current assets
Current investments

Inventories 1017 1235 1112 1168 1121

Trade receivables 943 1244 1215 1360 1723
Cash & bank balances 39 56 74 48 38
Short term loans & Advances 382 267 254 273 321
Other current assets 162 26 5 0.2 4
Current assets 2543 2828 2660 2849.2 3207
Total assets 5298 5380 5576 5877 6164

Document Classification: KPMG Confidential

Minda Industries Limited- Financials

Minda Industries Limited- Income Statement

INR Mn except EPS FY'11 FY'12 FY'13 FY'14 FY'15

Revenue
Net Sales 9542 11792 13404 17061 22266
Other income 146 163 109 168 229
Total Revenue 9688 11955 13513 17229 22495
Expenses
Cost of raw materials consumed 6446 8046 9493 9163 12357
Purchases of stock in trade 25 2634 2495

Change in inventories of finished goods, work in

-95 82 -112 -86 -75
progress and stock in trade

Employee benefit expense 1014 1343 1439 2248 2878

Other expenses 1339 1562 1624 2323 3067
Operating expenses 8704 11033 12469 16282 20722
Earnings before interest, taxes, depreciation,
838 759 935 779 1544
amortization (EBITDA)
Depreciation & Amortization 338 402 463 591 835
Earnings before interest & taxes (EBIT) 646 520 581 356 938
Finance costs 167 198 191 242 250
Profit before tax & exceptional items 479 322 390 114 688
Exceptional items -76 2 15 159
Tax expense 122 3 109 76 194
Net Profit 357 243 283 53 653
(-) Share of profit transferred to minority 2 6 10 3
(+) Share of profit/loss of associate 42 -7 8 24
Net Profit for the year 357 283 270 51 674
Earning per share (EPS) Face value 10 26.1 17.7 17.7 4.5 42.8

Workings
Current market price of share 507
Common shares outstanding 15,871,324
Market value of equity (Rs. in million) 8042
Minority interest 213
Debt 2087
Cash & Bank balance and current investments 300
Net debt (Rs Mn) 1787
Enterprise value (Rs Mn) 10042

Document Classification: KPMG Confidential

Minda Industries Limited- Balance sheet

INR Mn FY'11 FY'12 FY'13 FY'14 FY'15

Equities & Liabilities
Shareholders funds
Share capital 565 194 194 194 194
Reserves & Surplus 1422 2668 2895 2920 3459
Minority interest 115 123 138 213
Deferred revenue income 8
Shareholders funds 1987 2977 3212 3260 3866

Non Current Liabilities

Long term borrowings 552 661 887 1376 972

Deferred tax liabilities (net) 103 5
Long term provisions 74 157 176 237 264

Other long term liabilities 2 6 74 19 30

Non current liabilities 731 829 1137 1632 1266

Current Liabilities
Short term borrowings 950 938 808 1402 1115
Trade payables 1399 1773 2164 2473 2669
Other current liabilities 448 551 633 935 894
Short term provisions 79 99 111 111 157
Current liabilities 2876 3361 3716 4921 4835
Total Liabilities 5594 7167 8065 9813 9967
Assets
Non current assets
Fixed assets
Tangible assets 2405 2654 3116 3928 4027
Intangible assets 98 92 69 77 85
Capital work in progress 62 47 416 218 89
Intangible assets under development 7 4 6 0.7 3
Non current investments 189 217 218 244 263
Deferred tax assets 14 16 2
Long term loans & Advances 133 216 224 206 186
Other non current assets 17 15 45 86 119
Non current assets 2911 3245 4108 4776 4774
Current assets
Current investments 11 230 20

Inventories 837 1963 895 1246 1406

Trade receivables 1307 808 2173 2610 2895
Cash & bank balances 229 666 385 278 280
Short term loans & Advances 301 446 466 598 544
Other current assets 9 28 38 75 48
Current assets 2683 3922 3957 5037 5193
Total assets 5594 7167 8065 9813 9967

Document Classification: KPMG Confidential

Sona Koyo Steering Systems Limited- Financials

Sona Koyo Steering Systems Limited- Income Statement

INR Mn Except EPS FY'11 FY'12 FY'13 FY'14 FY'15

Revenue
Net Sales 12067 14212 14600 14923 15529
Other income 33 31 93 397 48
Total Revenue 12100 14243 14693 15320 15577
Expenses
Cost of raw materials consumed 8575 9841 10042 10054 10159
Purchases of stock in trade 95 109 269 300 197
Change in inventories of finished goods, work in progress and stock
-115 46 -65 -93 -22
in trade
Employee benefit expense 887 1132 1258 1342 1457
Other expenses 1166 1336 1449 1535 1580
Operating expenses 10608 12464 12953 13138 13371

Earnings before interest, taxes, depreciation, amortization (EBITDA) 1459 1748 1647 1785 2158

Depreciation & Amortization 377 457 585 679 1037

Earnings before interest & taxes (EBIT) 1115 1322 1155 1503 1169
Finance costs 437 459 411 392 311
Profit before tax & exceptional items 678 863 744 1111 858
Exceptional items 58
Tax expense 245 258 263 247 267
Net Profit 491 605 481 864 591
(-) Share of profit transferred to minority 45 115 98 177 204
(+) Share of profit/loss of associate -7 -6
Net Profit for the year 446 490 383 680 381
Earning per share (EPS) Face value 1 2.2 2.4 1.9 3.4 1.9

Workings
Current market price of share 50.4
Common shares outstanding 198,741,832
Market value of equity (Rs. in million) 10016.59
Minority interest 985
Debt 2098
Cash & Bank balance and current investments 179
Net debt (Rs Mn) 1919
Enterprise value (Rs Mn) 12921

Document Classification: KPMG Confidential

Sona Koyo steering systems Limited- Balance sheet

INR Mn FY'11 FY'12 FY'13 FY'14 FY'15

Equities & Liabilities
Shareholders funds
Share capital 198 198 198 198 198
Reserves & Surplus 1857 2193 2423 2890 3035
Minority interest 382 508 607 785 985
Shareholders funds 2437 2899 3228 3873 4218
Non Current Liabilities

Long term borrowings 2547 2623 2403 1695 1674

Deferred tax liabilities (net) 353 397 517 525 417

Long term provisions 40 44 54 61 68
Other long term liabilities 3 0.1 3 3 2

Non Current Liabilities 2943 3064.1 2977 2284 2161

Current Liabilities
Short term borrowings 322 352 703 653 424
Trade payables 1937 2033 1935 1951 1926
Other current liabilities 809 995 1442 1398 1202
Short term provisions 196 185 189 227 199
Current Liabilities 3264 3565 4269 4229 3751
Total Liabilities 8644 9528.1 10474 10386 10130
Assets
Non current assets
Fixed assets
Tangible assets 4541 5184 5783 5715 5469
Intangible assets 142 264 286 302 372
Capital work in progress 146 398 254 632 490
Intangible assets under development 93 62 65 121 142
Goodwill on consolidation 11 15 24
Non current investments 295 295 295 9 12
Long term loans & Advances 214 226 137 103 72
Other non current assets 3 3 4 4 4
Non current assets 5445 6447 6848 6886 6561
Current assets
Current investments
Inventories 752 607 814 935 1004

Trade receivables 1617 1752 2274 2082 1892

Cash & bank balances 119 123 25 28 179
Short term loans & Advances 550 361 291 361 322
Other current assets 161 238 222 94 172
Current assets 3199 3081 3626 3500 3569
Total assets 8644 9528 10474 10386 10130

Document Classification: KPMG Confidential

Talbros Automotive Components Limited (Target Company)- Financials

Talbros Automotive Components Limited- Income Statement

INR Mn except EPS FY'11 FY'12 FY'13 FY'14 FY'15

Revenue
Net Sales 3208 3754 3447 3659 3887
Other income 50 39 62 71 96
Total Revenue 3258 3793 3509 3730 3983
Expenses
Cost of raw materials consumed 1843 2163 1988 1948 2115
Purchases of stock in trade 16 22 139 181

Change in inventories of finished goods, work in progress and stock in

-106 -63 -78 2 -142
trade

Employee benefit expense 369 407 389 423 494

Other expenses 737 803 734 789 836
Operating expenses 2843 3326 3055 3301 3484

Earnings before interest, taxes, depreciation, amortization (EBITDA) 365 428 392 358 403

Depreciation & Amortization 108 112 103 104 99

Earnings before interest & taxes (EBIT) 307 355 351 325 400
Finance costs 166 199 205 190 187
Profit before tax & exceptional items 141 156 146 135 213
Exceptional items 88 -18
Tax expense 14 11 7 27 51
Net Profit for the year 127 145 139 196 144
Earning per share (EPS) Face value 10 10.2 11.6 11.2 15.6 11.4

Workings
Current market price of share 119
Common shares outstanding 12,345,630
Market value of equity (Rs. in million) 1469.13
Minority interest 0
Debt 1168
Cash & Bank balance and current investments 103
Net debt (Rs Mn) 1065
Enterprise value (Rs Mn) 2534

Document Classification: KPMG Confidential

Talbros Automotive Components Limited- Balance sheet

INR Mn FY'11 FY'12 FY'13 FY'14 FY'15

Equities & Liabilities
Shareholders funds
Share capital 123 123 123 123 123
Reserves & Surplus 749 847 935 1069 1148
Shareholders funds 872 970 1058 1192 1271
Non Current Liabilities
Long term borrowings 343 327 257 309 317

Deferred tax liabilities (net) 71 76 65 52 47

Long term provisions 39 32 39 40 41

Other long term liabilities 12 6 3
Non current laibilities 453 435 373 407 408

Current Liabilities

Short term borrowings 588 678 758 772 851

Trade payables 778 825 754 749 923
Other current liabilities 274 288 332 310 357
Short term provisions 28 19 27 28 25
Current liabilities 1668 1810 1871 1859 2156
Total Liabilities 2993 3215 3302 3458 3835
Assets
Non current assets
Fixed assets
Tangible assets 1046 1063 1013 1038 1110
Intangible assets 14 11 39 40 35
Capital work in progress 21 5 38 103 85
Intangible assets under development 1 4 4
Non current investments 6 25 29 42 57
Long term loans & Advances 67 87 115 114 127
Other non current assets 1 2 3 5
Non current assets 1154 1193 1240 1340 1423
Current assets
Current investments 9

Inventories 856 989 1065 1068 1275

Trade receivables 658 716 644 696 738
Cash & bank balances 57 76 89 81 103
Short term loans & Advances 251 235 255 264 287
Other current assets 8 6 9 9 9
Current assets 1839 2022 2062 2118 2412
Total assets 2993 3215 3302 3458 3835

Document Classification: KPMG Confidential

 Control Premium Analysis

Target Acquirer
Kar Mobiles Ltd (60.43%) Rane Engine Valves Ltd
JMT Auto Ltd (52.61%) Amtek Auto Ltd
Shanthi Gears Ltd (70.12%) Tube Investments of India Ltd
Igarashi Motors Ltd (51.9%) Agile Electric Drives Technologies & Holdings Ltd
Automotive Stamping & Assemblies Ltd (37.5%) Tata Autocomp Systems Ltd
Amtek India Ltd (60.21%) Amtek Auto Ltd
Ahmednagar Forgings Ltd (47.4%) Amtek Auto Ltd

Document Classification: KPMG Confidential

emium Analysis
Premium
Completion Date Deal value (Rs Mn) Offer price 1 day prior 1 month prior price 1 day prior
NA 460 150.5 48.94% 40.79% 101.05
1/13/2013 2440 148.7 34.39% 50.96% 110.65
11/19/2012 4080 80.98 34.85% 51.95% 60.05
3/31/2011 760 76.3 69.15% -13.44% 45.11
NA 340 89.5 -5.29% -6.18% 94.50
12/15/2010 9400 70.4 -22.98% -28.20% 91.40
NA 1900 114.77 18.63% 22.95% 96.75
Mean 25.38% 16.98% possibility of outliers
Median 34.39% 22.95% hence we use Median 1 month prior
insider info leakage can lead to manipulation of prices

Document Classification: KPMG Confidential

 price 1 month prior
106.90
98.50
53.29
88.15
95.40
98.05
93.35
bility of outliers
we use Median 1 month prior
pulation of prices

Document Classification: KPMG Confidential

 Comparable Company Analysis
Estimated Financials (Rs mn Estimated Financials (Rs mn
except EPS) FY'16 (E) except EPS) FY'17 (E)
Net Earning Net Earning
Net Profit per Net Profit per
Companies EBITDA EBITDA
Sales for the share Sales for the share
year (EPS) year (EPS)
Munjal Showa Ltd. 18154 1422 832 20.8 20283 1629 969 24.3

Gabriel India Ltd. 17659 1462 865 6.0 20211 1782 1091 7.6

Minda Industries Ltd. 23546 1919 742 46.9 27031 2342 1086 65.8

Sona Koyo Steering Systems Ltd. 17406 2322 702 3.5 18873 2617 666 3.4

Talbros Autimotive Components Ltd. 4600 540 210 17.0 5460 700 310 25.1

Document Classification: KPMG Confidential

able Company Analysis
Price per Enterprise
Share value (EV) EV/Sales EV/EBITDA P/E
as on 3rd
June as on 3rd
2015 (INR June 2015
Mn) (INR Mn) FY'15 FY'16E FY'17E FY'15 FY'16E FY'17E FY'15 FY'16E FY'17E
160.8 5736 0.349 0.316 0.283 4.531 4.034 3.521 8.508 7.731 6.617

76.9 11066 0.766 0.627 0.548 9.499 7.569 6.210 18.310 12.817 10.118

506.7 10042 0.451 0.426 0.371 6.504 5.233 4.288 11.839 10.804 7.701

50.4 12921 0.832 0.742 0.685 5.987 5.564 4.937 26.526 14.400 14.824

119.0 2534 0.652 0.551 0.464 6.288 4.693 3.620 10.439 7.000 4.741

Mean 0.610 0.532 0.470 6.562 5.419 4.515 15.124 10.550 8.800

Median 0.652 0.551 0.464 6.288 5.233 4.288 11.839 10.804 7.701

Document Classification: KPMG Confidential

 Valuation Summary: Comparable Company Analysis Based Valuation

Valuation Matrix (Rs Mn)

Multiples EV/Sales EV/EBITDA P/E
Median Multiple (2016 E) 0.551 5.233 10.804
Fair Enterprise Value (Equity value in case of P/E) 2534 2826 2269
Subtract: Net Debt 1065 1065
Fair equity value 1469 1761 2269
Add: Control Premium 337 404 521
Adjusted equity value 1806 2165 2789
Price per share 146.31 175.36 225.95

Document Classification: KPMG Confidential

mpany Analysis Based Valuation

Financials
Talbros Automotive Components Limited Rs Mn) FY16E
Revenue 4600
EBITDA 540
PAT 210

Document Classification: KPMG Confidential

 Comparable Transaction Analysis

Announcement Completion
Date Date Target Company
20-May-14 Kar Mobiles Limited (60.43% Stake)
27-Jun-13 3-Oct-13 JMT Auto Limited (52.61% Stake)
3-Aug-12 3-Aug-12 Mag Engineering Private Limited (100% Stake)
13-Jul-12 19-Nov-12 Shanthi Gears Limited (70.12% Stake)
5-Jan-12 23-Feb-12 Trinity India Limited (78% Stake)

10-Dec-10 31-Mar-11 Igarashi Motors India Limited (51.9% Stake)

1-Aug-08 15-Dec-10 Amtek India Limited (60.21% Stake)

31-Jul-08 Ahmednagar Forgings Ltd (47.4% Stake)

Document Classification: KPMG Confidential

Comparable Transaction Analysis
Enterprise Year 1
Value Paid Ending Sales INR EV/Revenue EV/EBITDA PE
Bidder Company INR (mn) Date (mn) Multiple Multiple Multiple
Rane Engine Valve Limited 589.2 31-Mar-14 1201.7 0.49 7.01 24.47
Amtek Auto Limited 3453.2 31-Mar-13 3350.2 1.03 6.17 18.07
Sandhar Technologies Limited 700 31-Mar-12 652.3 1.07 4.78 NA
Tube Investments of India Limited 6058.2 31-Mar-12 1730.1 3.50 8.74 23.54
Ring Plus Aqua Ltd. 893.2 31-Mar-11 843.9 1.06 9.88 117.81
Agile Electric Drives Technologies
1523.4 31-Mar-10 1592.4 0.96 8.12 38.73
and Holdings Private Limited
Amtek Auto Limited 13,188.80 30-Jun-08 13,189.10 1.00 2.56 6.15
Amtek Auto Limited 5025.5 30-Jun-08 6610.6 0.76 4.50 6.66
Mean 1.23 6.47 33.63
Median 1.02 6.59 23.54

Document Classification: KPMG Confidential

 Valuation Summary: Comparable transaction analysis basedValuati

Valuation Matrix (Rs Mn)

Multiples EV/Sales EV/EBITDA P/E
Median Multiple 1.015 6.590 23.540
Fair Enterprise Value (Equity value in case of P/E) 3945 2656 3390
Subtract: Net Debt 1065 1065
Fair equity value 2880 1591 3390
Value per share 233.31 128.85 274.57

Document Classification: KPMG Confidential

action analysis basedValuation

Financials FY'15
Talbros Automotive Components Limited (Rs Mn)
Revenue 3887
EBITDA 403
PAT 144
Net Debt 1065

Document Classification: KPMG Confidential