GOTTA BE A BETTER WAY - Amara Raja

AMARA RAJA WON THE
COMMENDATION
(FOUNDATION AWARD)
‘STRONG COMMITMENT TO
HR EXCELLENCE’ AWARD AT
THE NATIONAL HR
CONCLAVE OF CII IN JULY
2010.
44
AMARA RAJA BATTERIES LIMITED
ANNUAL REPORT 2010-11
Management Trainee (MT) Programme
(ARGMP).
AR e-Induction
Amara Raja’s intranet-based e-induction
for new recruits enabled on-board
processes, which the employee was
required to complete within 72 hours of
joining. The process was designed
around quizzes and interactive content to
facilitate faster alignment of the recruit
into the organisation.
The programme comprised modules on
the facets of Amara Raja, its corporate
social responsibility and people
development to familiarise the recruit
with different products, processes,
milestones and culture.
Learning and Development
Amara Raja Learning and Development
Calendar (ARLDC) captured
developmental needs arising out of
performance appraisals, TQM, TPM and
several other initiatives. During the year
under review, in-house programmes were
anchored to build technical and soft
skills. Employees were nominated for
specialised learning and development
workshops/seminars organised by
external learning institutions/agencies.
Respective SBU teams anchored their
specific team building workshops to help
align their customer needs with overall
business needs. The team workshops
were also anchored to generate
togetherness and harmony in achieving
business objectives as an SBU and
company.
The introduction of e-Learning made it
possible for participants to choose
content and tools appropriate to their
differing interests, needs and skill levels
with 24x7 accessibility.
Employee engagement
Amara Raja launched the AR-Speak
survey, comprising 19 dimensions in
2007-08. A similar employee
engagement survey was anchored in
August 2010, drawing full employee
participation. Based on survey inputs,
change action plans were drawn at
various levels followed by relevant
actions.
HR portal
ARG-HR portal, the employee’s intranet
portal, served as an HR window of the
organisation. The portal’s interactive
learning forum provided feedback.
CII-HR Excellence Recognition
Amara Raja adopted the Confederation
of Indian Industry-Human resources (CII-
HR) Excellence Model. For the first time
in March 2010, the organisation
participated in an external on-site
assessment by external assessors
(appointed by CII) on HR strategy,
processes and practices based on the HR
excellence model. This assessment will
enable Amara Raja to excel in human
resources as well as performance
processes, practices and capabilities.
Amara Raja won the commendation
(Foundation Award) ‘Strong commitment
to HR Excellence’ award at the National
HR Conclave of CII in July 2010.
ANALYSIS OF THE FINANCIAL
STATEMENTS
Accounting policy
The financial statements were prepared
to comply, in all material respects, with
the requirements of the Companies Act,
1956, guidelines issued by the Securities
and Exchange Board of India (SEBI) and
Generally Accepted Accounting Principles
(GAAP) in India. The financial statements
were prepared under the historical cost
convention on an accrual basis. The
accounting policies were consistently
applied by Amara Raja and were in line
with those used in the previous years. The
estimates and judgements used in the
preparation of financial statements have
been made on prudent and reasonable
basis to reflect in a true and fair manner
the substance of transactions, and
reasonably present the state of affairs,
profits and cash flow for the year.
Key highlights, 2010-11
Absolutes
• Net sales increased 20% from `14,645
million in 2009-10 to `17,611million
in 2010-11
• EBIDTA declined 13% from `2,965
million in 2009-10 to `2,588 million
in 2010-11
• PBT declined 13% from `2,546 million
in 2009-10 to `2,210 million in
2010-11
• PAT dropped 11% from `1,670
million in 2009-10 to `1,481 million
in 2010-11
Derivatives
• EBIDTA margin declined 555 bps from
20.24% in 2009-10 to 14.69% in
2010-11
• PBT margin declined 484 bps from
17.38% in 2009-10 to 12.54% in
2010-11
• PAT margin declined 300 bps from
11.40% in 2009-10 to 8.40% in
2010-11
• ROCE declined from 44.51% in 2009-
10 to 34.62% in 2010-11
Analysis
• Every rupee invested in the fixed assets
yielded higher revenue – fixed assets
turnover ratio improved from 4.79
times in 2009-10 to 5.59 times in
2010-11
• Decline in profit margins reflect the
challenges, in terms of demand and
price, prevalent in the telecom
segment and higher input costs
• Income from investment (interest and
dividend) was significantly higher than
the interest liability, making Amara
Raja a net interest earner
• Even as Amara Raja invested about
`625 million in its gross block in
2010-11, the Debt-Equity ratio
strengthened to 0.15:1 (0.17:1 as on
March 31, 2010)
Revenue and Price
Gross sales grew 23% from `16,904
EVERY RUPEE INVESTED IN
THE FIXED ASSETS YIELDED
HIGHER REVENUE – FIXED
ASSETS TURNOVER RATIO
IMPROVED FROM 4.79 TIMES
IN 2009-10 TO 5.59 TIMES IN
2010-11
GOTTA BE A
BETTER WAY 45