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Gearing up for the next level throughA Stronger Balance SheetIN 2008-09, TIL’S ENERGIES WEREFOCUSED ON MAKING IT FISCALLY MOREROBUST SO THAT OUR BALANCE SHEETGAINED THE NECESSARY RESILIENCE TOWEATHER ECONOMIC HEADWINDS, ANDRESULTANTLY ENABLE THE FACILITATION OFOUR ENTRY INTO THE NEXT ORBITOF GROWTH.Apart from our regular policy of fiscalsensitization for all our people, we investedin competitive intelligence for benchmarkingand revisiting customer opportunitiesand risks without compromising on fiscalsalience, which gave our efforts a holisticbearing. In addition to this, the adoptionof a judicious expenditure optimisationprogramme allowed TIL to contain theimpact of the adversities.We also ensured that despite theoverarching pessimism in the externalmood, the fiscal strength of TIL remainedintact as a result of our prudent capitalmanagement practices.Better Working Capital MetricsOur debtors days’ cover came down from49 days in the previous year to 45 daysduring 2008-09 and our inventory days’cover reduced from 88 to 84 days in thesame period.This was achieved despite the constraintsplaced under Caterpillar’s ‘ManagedDistribution System’ which required a sixmonth lead time in equipment ordering.Caterpillar met orders placed in the firsthalf of 2008-09 during the second half,when recession had already crept in. Asa result, TIL accumulated a large machineand engine stock as order cancellations anddeferments occurred. However, in spite ofthe difficult business climate, TIL secured alarge order and reduced its inventory level.Consistent Capital ExpenditureTIL invested a sum of Rs. 3,435 lacstowards its capital expansion plans, andconsequently, the loan funds increasedto Rs. 11,343 lacs on 31st March, 2009from Rs. 7,876 lacs on 31st March, 2008.Despite this, the Company managed tokeep its overall liability under check – anincrease of only Rs. 545 lacs fromRs. 22,293 lacs on 31st March, 2008 toRs. 22,838 lacs on 31st March, 2009.Improving Liquidity ParametersAll our liquidity parameters improved as aresult – our current ratio went from 1.44in 2007-08 to 1.55 this year and our creditworthiness improved from 1.66 last year to1.37 in the year under review. The returnon capital employed in our business was ahealthy 25 per cent.We are therefore well poised to leverageour strong financial position in assuminghigher business volumes and in effect,geared up for the next level of growth.