1 › Analyst Meet › 126881_20090630.pdf · DECLARES FINAL DIVIDEND OF 100DECLARES FINAL DIVIDEND...
Transcript of 1 › Analyst Meet › 126881_20090630.pdf · DECLARES FINAL DIVIDEND OF 100DECLARES FINAL DIVIDEND...
1www.ftindia.com
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Certain statements in this presentation contain forward-looking information about Financial Technologies
(India) Ltd. and its group companies, including their business operations, strategy and expected financial
performance and condition. Forward-looking statements include statements that are predictive in nature,
depend upon or refer to future events or conditions, or concern future financial performance (including
revenues, earnings or growth rates), possible future plans and action of the company. Forward-looking
statements are based on current expectations and understanding about future events.
They are inherently subject to, risks, uncertainties, and assumptions, etc about the Company, economic
factors and the industry in general. The Company’s actual performance and events could materially differ from
those expressed or implied by forward-looking statements made by the company due to, but not limited to,
important factors such as general economic, political and market factors in India and internationally,
competition, technological change, and changes in the government regulations.
SAFE HARBOR STATEMENT
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PAT 205 77 166%
INCOME STATEMENT
FINANCIAL HIGHLIGHTS (Standalone)
Q1 FY 09 Y-o-Y %Q1 FY 10(in Rs. mn)
Note: Above stated financials are standalone figures excluding long term capital gain on shares
OPERATING REVENUES 585 440 33%
TOTAL INCOME 650 473 37%
PROFIT FROM OPERATIONS 174 76 130%
EBITDA 253 124 104%
PBT 239 108 121%
DECLARES FINAL DIVIDEND OF 100% ON THE FACE VALUE OF RS. 2/- PER SHAREDECLARES FINAL DIVIDEND OF 100% ON THE FACE VALUE OF RS. 2/- PER SHARE
Financial Technologies' operating revenue increased by 33% to Rs. 585 million (Y-o-Y) for the quarter ended June 30, 2009
Profit from operations has increased by 130% to Rs. 174 million (Y-o-Y) for the quarter ended June 30, 2009
Net profit excluding long term capital gain on shares increased by 166% to Rs. 205 million (Y-o-Y) for the quarter ended June 30,2009
FTIL has signed an agreement on July 18, 2009 and has sold (secondary sale) 5% stake in the then equity share capital of MCX Stock Exchange Limited to IFCI Ltd at Rs.35 per share. The sale has been done to comply with the regulatory requirements
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Dewang Neralla, Whole Time Director, Financial Technologies said:
“Financial Technologies has witnessed yet another strong quarter. Operating revenues has increased by 33% to Rs. 585 million (Y-o-Y). Net profit excluding long term capital gain on shares has grown by 166% to Rs. 205 million (Y-o-Y). These results underscore the resilience of our robust business model and the potential of our technology solutions.
Continuing our leadership in the trading technology, National Multi Commodities Exchange (NMCE) signed up FTIL's ODIN for its Front-end Trading technology.
This quarter we have brought posse of strategic investors in MCX-SX; bringing business synergies and broad experience. IEX completed 1 year of successful operations maintaining dominant market share of 92%. Within 6 months of operations, NSEL has emerged as a coveted and leading spot exchange in the country with more than 95% market share.
On the ecosystem front, NBHC has seen steady growth with increased storage facilities and increase in funding facilitated. Continuing to broaden the product portfolio ‘atom’ has launched Merchant Acquiring Business (MAB) through PoS (Point of Sale) terminal, along with its existing streams of voice based (IVR) and mobile based payments.
The group continued to forge strategic relationships with leading players in various business segments; the corporate milestonesin Q1 FY10 included partnership with Invest In Denmark under the Global Alliance program.”
COMMENTING ON FINANCIAL TECHNOLOGIES’ FY 2008-09 PERFORMANCE
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The Company, as part of its core business strategy promotes and invests in new ‘Exchange’, ‘Technology’ and ‘Ecosystem’ventures that utilize its technological capabilities and domain expertise towards creating world class enterprises. The investment in each such venture is assessed for its risks and is limited to a pre-determined level and will generate returns after the ventures start ramping-up operations in 2 to 4 years time frame. The company, as part of its non-linear business model, will continue to unlock value by broadening the investor base of its ventures. At this moment, the broad framework for investment in ventures is as follows:
- Domestic ventures upto US$ 10 million
- International ventures upto US$ 25 million
- Exceptional ventures upto US$ 50 million
Despite continuing investments in these ventures, our cash surplus including investment in mutual funds (standalone) is at Rs. 11,137.2 million as on June 30, 2009
BROAD INVESTMENT PHILOSOPHY
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STRONG BALANCE SHEET
Net worth of Rs. 17,546 million as on Jun 30, 2009
Company has cash and bank balances of Rs.4,029.2 million and mutual funds of Rs.7,108 million (aggregated to Rs. 11,137.2million) as on June 30, 2009
Zero Coupon Convertible Bonds (ZCCB) of Rs. 4,332 million as on Jun 30, 2009
SUMMARIZED BALANCE SHEET (Standalone)
SOURCES OF FUNDS
Shareholders’ Funds
Share Capital
Reserves & Surplus
Loan Funds
Unsecured Loan
Zero Coupon Convertible Bonds
Deferred tax liability (Net)
TOTAL
APPLICATION OF FUNDS
Fixed Assets
Investments
Deferred Tax Asset
FCMITDA*
Current Assets, Loans & Advances
Less: Current Liabilities & Provisions
Net Current Assets
TOTAL
(in Rs. mn)
*Foreign Currency Monetary Item Translation Difference Account
AS ON JUNE 30, 09
AS ON MARCH 31, 09
4,332
120
21,998
17,454
92
4,611
167
22,275
17,405
92
AS ON JUNE 30, 09
AS ON MARCH 31, 09
2,645
14,471
-
137
6,755
2,010
4,745
21,998
2,841
14,445
-
353
6,438
1,802
4,636
22,275
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CASH AND CASH EQUIVALENTS (Standalone)
PARTICULARS
(in Rs. mn)
MUTUAL FUNDS
FIXED DEPOSITS
CURRENT / EEFC ACCOUNT
TOTAL
AS ON JUNE 30, 09
AS ON MARCH 31, 09
7,209
3,850
558
11,617
7,108
3,885
144
11,137
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BUSINESS OVERVIEW:Self Fueling Model for GrowthExchange Business OverviewEcosystem Business Overview
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BROKERAGE SOLUTIONSEXCHANGE SOLUTIONS
EXCHANGEBUSINESS
ECOSYSTEMBUSINESS
TECHNOLOGYBUSINESS
INTE
RN
ATI
ON
AL
COMMODITY
EQUITY & FX
ENERGY
COMMODITY & FX
MULTI-ASSET
DEPOSITORY
TRANSACTION PROCESSING
KNOWLEDGE SERVICES
INFORMATION RETAIL
CLEARING CORP.
* Holding in the companies are direct or through subsidiaries
DO
MES
TIC
BUSINESS OVERVIEW
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Technology Revenue Exchange Revenue Ecosystem Revenue Income / Dividend from investments Long Term Capital Gains
SELF FUELING MODEL FOR GROWTH
Revenue DriversTransaction FeesMembership FeesContent DistributionInterest on float
CustomersExchanges MembersBanks
EXCHANGE BUSINESSRevenue Drivers
Licensing FeesAMC FeesMessaging (STP) FeesConsultancy FeesLong Term Capital GainsInterest and dividend income from investments
CustomersExchangesBrokerage housesDPs, funds, AMCs
TECHNOLOGY BUSINESS
Revenue DriversWarehouse Receipt Financing revenueStorage and allied serviceProcurement revenue
CustomersBanksFarmers / TradersCentral GovernmentInstitutions
ECOSYSTEM BUSINESS
GROUP REVENUE DRIVERS
SELF-FUELINGVIRTUOUS
GROWTH CYCLE
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MCX - LEADERSHIP (www.mcxindia.com)
MCX market share for the Q1 FY10 has increased to 86% as compared to 85% in Q1 FY09
Average Daily turnover of Rs. 17,833 cr has been recorded for the period of Apr-Jun, 2009, an increase of 46% over Q1 FY09
Highest turnover of Rs.28,747 cr was recorded on April 2, 2009
Ranked 4th among Asia-Pacific Commodity Derivatives Exchanges(Source: Exchange websites)
HIGHLIGHTS
DOMESTIC MARKET SHARE (Q1 FY 09-10)*
*Source: FMC
DOMESTIC MARKET SHARE (Q1 FY 08-09)*
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MCX - OPERATIONAL GROWTH
**The figures are derived from the FMC website (www.fmc.gov.in) and have been aggregated by the company
QUARTERLY AVERAGE DAILY TURNOVER (Rs. bn.)** TOTAL VALUE TRADED** (CAGR: 68%) (Rs. bn)
TOTAL VALUE TRADED (Rs. cr)
AVERAGE DAILY TURNOVER (Rs. cr)
MARKET SHARE %
Y-o-Y%Q1-FY 10 Q1 FY 09
1,337,487
17,833
86%
41%
46%
949,897
12,178
85%
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MCX witnessed a record turnover of Rs. 33.19 crores in wheat contracts
MCX launched futures trading in Almond for the first time in the World
MCX crude oil volume crossed 25 million barrels mark for the first time ever
Aries Agro Ltd signed pact with MCX
MCX - KEY DEVELOPMENTS
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MCX-SX - OPERATIONAL GROWTH (www.mcx-sx.com)
*As on June 30, 2009 since inception**On May 19, 2009
WEEKLY VOLUME MOVEMENT MARKET SHARE AS OF JUNE 2009
AS OF JUNE 2009 AS OF MARCH 2009 Q- o-Q GROWTH
APPROVED NO. OF MEMBERS
CITIES PARTICIPATED ACROSS INDIA
AVERAGE DAILY TURNOVER * (Rs. cr)
HIGHEST TURNOVER (Rs. cr)
AVERAGE DAILY VOLUMES* (Contracts)
HIGHEST NO. OF CONTRACTS TRADED (Lots)
11%
5%
40%
41%
532
441
1,305.39
3,912.08
261,821
775,953
592
464
1,820.57
4,754.79**
370,036
997,608**
Note: BSE share negligible
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The RBI-SEBI Technical Committee Report on Interest Rate Futures released on 17th June 2009, the product is expected to be launched shortly
MCX Stock Exchange applied for approval to the regulators to launch Interest Rate Futures, coming under the Currency Derivatives segment
MCX Stock Exchange started the educative seminars on Interest Rate Futures in the four metros viz. Mumbai, Delhi, Chennai & Kolkata.
MCX Stock Exchange published a book titled ‘A Guide to Interest Rate Futures’ in line with our philosophy of Information, Innovation, Education & Research.
MCX-SX - KEY DEVELOPMENTS
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RICH PARENTAGE MCX-SX CCL is promoted by MCX-SX (51%), MCX & Financial Technologies (49%)
CORE STRENGTHS An independent and vertically integrated approved Clearing House, MCX-SX CCL in place to undertake clearing & settlement activities for its members Settlement guarantee fund transferred from MCX-SX –Rs. 25 Mn
Simplification of risk management through substitution of many counterparties by a central counterparty
Ensures ‘certainty’ and augments market confidence through mutualization of losses under extreme but plausible market scenarios
Standardization of transaction processing across markets or geographies
Highest credit quality rating LAAA(SO) assigned by ICRA
2nd approved clearing house by SEBI and RBI
Margins fixed as per CME (Chicago Mercantile Exchange) SPAN (Standardized Portfolio Analysis of Risk) margin system +1% ELM (Excess Loss Margin)
Automatic square off if MTM losses exceed 75% of margin limit
KEY HIGHLIGHTS
MCX-SX CCL
Establish as a leading provider of post-trade, pre-settlement trade management solutions for market participants
Enhance operational efficiency and mitigate risk through collaboration with all stakeholders via straight-through processing (STP) solution
In line with global developments, gear up to handle settlement and associated risk of OTC derivative products
STRATEGIC FOCUS
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IEX - OPERATIONAL GROWTH (www.iexindia.com)
DOMESTIC MARKET SHARE** HIGHLIGHTS
India’s No. 1 power exchange with 92% market share**
Number of Members - 62*
Total Turnover - Rs. 3,172 cr*
Total number of contracts traded – 3,795,750 MWh*
Highest number of contracts traded - 27,671 MWh on Jun 27, 2009
Average Daily Volume - 12,960 MWh (for Apr-Jun, 2009)
Average Daily Turnover - Rs. 13 cr (for Jan-Mar 2009)
IEX completed 1 year of successful operations with 37,35,000 WH of electricity traded in 1st year
Members added during Quarter:
- BSEB, Welspun Gujrat Stahl Rohren Ltd., Kerala State Electtricity Board, VARRSANA ISPAT LIMITED, JAIPRAKASH ASSOCIATES LTD., Madhucon Sugar and Power Industries Ltd. & Narayanpur Power Co. Pvt Ltd.
Strategies adopted in market
- More penetration into physical market
- Wide participation of smaller players like CPPs, generators (less than 10 MW), Distribution Licensees
Keeping existing members intact through better services
CERC gave in-principle approval to IEX to enter into Term Ahead Market. Plans to launch new products like
- Intra Day Contract
- Daily Contract
- Day Ahead Contingency
- Weekly Contract
- Monthly Contract
- Intra-State Contract
*As on June 30, 2009 since inception**For the Apr-June, 2009 in terms of volume Source : www.powerexindia.com for PXI turnover
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NSEL- OPERATIONAL GROWTH (www.nationalspotexchange.com)
*As on June 30, 2009
NSEL commenced its live operation on October 15, 2008 and since then, it has seen continuous surge in its volume
Number of members: 273*
National Spot Exchange, India's 1st electronic spot exchange, isaiming a daily turnover of up to Rs. 15,000 cr by 2011
NSEL has undertaken various meets like pulses meet, Gold meet atvarious places across the country to create awareness
Products in pipeline – RBD Palmolive, Jeera and Soyabean
Indian Bullion Market Association Limited which is a subsidiary of NSEL has been launched on 30th May, 2009 to create a National level forum for India’s bullion trade and to organize the Indian Bullion trade as unified, structures, credible and transparent market discovering bench mark Indian spot price.
Tied up with 9 banks for clearing operations
COMMODITIES AVAILABLE FOR TRADING AS ON JUNE 30, 2009
Bullion
Gold 1 Kg bar
Gold 100g bar
Silver 30 Kg bar
Intraday Gold 1 kg bar
Intraday Gold 100g bar
Intraday Silver 30 kg bar
Silver Granules 25 kg
Intraday Silver Granules 25 kg
Gold mini
Silver mini
NAFED Cotton ContractGuar SeedLemon TurImported UradRed Areca nut RashiYellow Peas
Castor SeedMaizeChanaSugarPepperCotton Bales
AVERAGE DAILY TURNOVER (Rs. mn) HIGHLIGHTS
Agri-Commodities
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First Pan-Asian Global Commodity derivatives Exchange based out of Singapore- Singapore is among the top 5 International Financial Centre
SMX will act as a proxy to the Asian economies like- China, India (closed economies)- Japan, Australia, Malaysia, Thailand, Indonesia, Vietnam (mostly inward)
KEY HIGHLIGHTS
Appointment of Standard Chartered Bank and RBS Bank as Clearing and Settlement Bank of SMX.Regulatory Framework update : Trading Rules approved by MAS.
OTHER RECENT DEVELOPMENTS
SINGAPORE MERCANTILE EXCHANGE (www.smx.com.sg)
KEY HIGHLIGHTS Offering access to a diverse range of multi asset products within a unique customer centric environment.
Direct access to one of the world’s fastest growing and largest areas of financial liquidity.
Via a multi access trading model, BFX will offer multi-asset class trading of conventional products whilst also pioneering Sharia compliant products within the regulatory framework of the Central Bank of Bahrain (CBB).
BAHRAIN FINANCIAL EXCHANGE (www.bfx.bh)
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NBHC - OPERATIONAL GROWTH (www.nbhcindia.com)
Presence 18 States
Sales & admin offices 73
Number of corporate clients 30
WarehousingStorage capacity 1.4 mn MT
Storage facilities 569
Collateral Management (CM)Commodity under CM (Cumulative) 7 mn MT
Geographical spread 800+ locations
CM Cumulative Funding facilitated Rs. 8750+ cr
Number of farmers under CM 45,000+
No. of Banks associated with 33
Number of commodities funded 115
Quality Assurance & Pest ManagementFunctional QA Laboratories 26
Number of Commodities tested 125
Number of Certificates Issued 80,000+
NBHC is the first and the only company in private sector having granted membership of NAWC (National Association of Warehousing Corporations). NAWC is affiliated to International Federation of Warehousing Logistics Association (IFWLA)
Collateral Management Arrangements during the quarter with Bank of Baroda and Akola Urban Co-op Bank
OPERATIONAL HIGHLIGHTS AS ON JUNE 30, 2009 OTHER DEVELOPMENTS
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atom - OPERATIONAL GROWTH (www.atomtech.in)
Agreement signed with Readers Digest, Paulo Holiday Makers, IHO, Ybrant Digital, Net core, One Touch Solutions, Country Club, Next Gen, Future GeneraliIndia, Iskon Food Relief Foundation, Redbus, Vodaphone, Net Assets, Shift thoughts, Gift 360
Atom has Launched Merchant Acquiring Business (MAB) through PoS (Point of Sale) terminal, for Union Bank of India.
Atom has tied up with Sahayata a leading Micro finance Institute in country for mobile application enabling their field officers to browse information related to disbursement, collections & pre payments using a normal Java–enabled handset. Sahayata has won EDGE Award “Enterprise application” developed by atom technologies.
SMS services enabled for brokers, agreement signed with 9 brokers
Business correspondent project initiated with SBI and PNB
atom IVR TRANSACTION VALUES (Cumulative in Rs. cr) HIGHLIGHTS
atom IVR TRANSACTION VOLUMES (Cumulative)
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SHAREHOLDING HIGHLIGHTS AS ON JUNE 30, 2009
PROMOTERS HAVE NOT PLEDGED ANY OF THEIR SHARESPROMOTERS HAVE NOT PLEDGED ANY OF THEIR SHARES
SHAREHOLDING STRUCTURE* STOCK INFORMATION
FINANTECHFINTECH
FTECH:IN / FITE.BO
45.88
1307.30 (BSE)
1.25**
1900.05 / 404.00 (BSE)
1895 / 382.35 (NSE)
Code : NSEBSE
Bloomberg / Reuters
No. of Shares Outstanding (In mn)
Closing Price***(In Rs. / share)
Market Capitalization***(US$ bn)
52 week high / low (In Rs. / share)
52 week high / low(In Rs. / share)
*As on June 30,2009 **Exchange Rate as on June 30, 09, US$1: 47.87 Rs. (Source: RBI reference rates)***As on June 30, 09
MAJOR INSTITUTIONAL SHAREHOLDERS*
Passport Capital LLC A/C
Reliance Mutual Fund
Acacia Partners, LP
FID Funds Mauritius Limited
Deutsche Securities Mauritius Limited
Morgan Stanley Mauritius Company Limited
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OTHER DEVELOPMENTSHUMAN RESOUCE ANALYSISCORPORATE GOVERNANCECSO INITIATIVES
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OTHER DEVELOPMENTS
Financial Technologies Selects Aegisoft for Client Simulator to Test and Support its FIX-Based Trading Gateway
Client Simulator acts as a fully-featured simulation of buy-side clients for the purpose of testing inbound FIX order flow. Client
Simulator reduces development and QA cycles so that customers can release their trading system faster and deliver the
highest quality software..
Invest In Denmark and Financial Technologies Group sign an MoU under Global Alliance Program
Invest in Denmark will introduce FT Group to financial associations, trade & investment associations, banks, market makers,
clearing companies, finance & economy teams, fund houses, traders, educational institutes, universities and government
representatives. The alliance will also look at promoting FT Group’s ventures in the Danish Markets.
NMCE Signs Up FTIL’s ODINTM for its Front-end Trading Technology
NMCE segment would be integrated in the Financial Technologies’ flagship product ODINTM, which enjoys more than 80%
market share in front-end exchange trading solutions used by brokers, banks and institutions.
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HUMAN RESOURCE ANALYSIS
Employee strength of the Group is 3,024 as on June 30, 2009
HR has implemented automated Core HR system, OGC Software & PMS Software to build a competent HR system
HR has conducted various employee connect events like Republic Day Celebration, Diabetes Reveal Program, Online Contests etc. to maintain a positive work life balance
Skill based Functional training programs and Enrichment programs are regular feature at FT
HIGHLIGHTS
FINANCIAL TECHNOLOGIES EMPLOYEESAS ON JUNE 30, 2009
QUALIFICATION WISE BREAK-UP
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CORPORATE GOVERNANCE
BOARD OF DIRECTORS
Highly accomplished and acclaimed industry leaders with rich and diverse wealth of experience from managing MNC to exchange regulators, bureaucrats, advising GOI
Advisory board members includes:
Mr. Narayanan Vaghul, Chairman
Dr. S. Narayan, Ph. D.
Mr. G. N. Bajpai
Mr. Kiran Karnik
Globally recognized leaders from technology and financial market space
Directors on the board includes:Mr. Jignesh Shah, Chairman
Mr. Dewang Neralla
Mr. P. G. Kakodkar
Mr. C. Subramaniam
Mr. Ravi K. Sheth
Mr. Chandrakant Kamdar
Mr. R. Devarajan
ADVISORY BOARD
Committees consisting of world-class professionals representing an appropriate and diverse mix of skills and experience committees
Audit Committee
Shareholders’/Investor Grievance & Share Transfer Committee
Remuneration and Compensation Committee
COMMITTEES
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CORPORATE GOVERNANCE
CG Policy-Encompasses - transparency, accountability, trusteeship, ethical corporate citizenship and management responsibilities and Insider Trading Dealing Code to comply with the Insider Trading Regulations issued by SEBI.
Audit Committee - Provides assurance on the adequacy of the internal control systems and financial disclosure & has a formal Risk Management Framework
Adherence & compliance with Clause 49 of Listing Agreement
CORPORATE GOVERNANCE STANDARDS
Financial Downloads - 5 year overview of both standalone and consolidated business, Quarterly financials and annual report
Detailed section in the website on Corporate Governance section
My FT - Facility to customize the dashboard and subscribe to SMS & e-mail alerts
Participation in all financial market related investor events and conferences
1800 229666 - 24 hrs toll free phone for Indian Investors and fax facility for uninterrupted investor interaction
INFORMATION SHARING & DISCLOSURE
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Gramin Suvidha Kendra (GSK)More than 4000 farmers are registered on the GSK platform. First all India GSK coordinators meet held at Jalgaon. The meet was sponsored by Aries Agro, Ion Exchange, and WRMS.
Khushi ki KiranMaking difference in the lives of the under privileged by volunteering for community service
Environmental AwarenessOn the occasion of World Environment Day 2009, FT Group along with Attero Recycling launched the first ever E-waste drive for employees on June 5th and 6th 2009, at Mumbai and other locations.
JagrutIn house peer education movement for HIV/AIDS awareness
EDUCATION
CSO INITIATIVES
HEALTH AND SAFETY COMMUNITY INVESTMENT
Blood Donation DriveFT Group of Companies in association with Rotary Blood Bank organized all India Blood Donation Drive on May 23, 2008. The drive conducted at various other locations across cities saw more than 500 units of blood being collected.
Mouth and Foot Painting Artists (MPFA)To provide exposure and publicity to MPFA through various mediums such as corporate gifts, calendars and events
Mumbai Marathon 200930 FT Group employees participated in the marathon, supporting the cause of the NGO -Save the Children India
Reach OutFT Group ‘Give As You Earn’ scheme was launched in the month of May 2009. This initiative lets an employee donate a sum of money from his/her monthly salary to the charity of his/her choice. Employees can also track how your money has been utilized - that too from their desk.
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FINANCIALS FOR QUARTER ENDED JUNE 30, 2009
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FINANCIALS FOR QUARTER ENDED JUNE 30, 2009
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Shreekant JavalgekarDirector - FinanceT: +91-2267152000M: +91 98211 [email protected]
Vaishali KariyaSr. Vice President - Investor RelationsT: +91-22-67152000M: +91 99302 [email protected]
INVESTOR RELATIONS CONTACTS: