Beml India

MoU Performance

MoU Performance Evaluation of the Company is based on a Balanced Score Card's approach and includes Financial and Non-Financial Parameters having equal weightage of 50% each. The Financial Parameters include Sales and Profitability related ratios. The Non-Financial Parameters are further divided into Dynamic Parameters (30%), Enterprise Specific Parameters (10%) and Sector Specific Parameters (10%). Dynamic Parameters consist of factors relating to Quality, Customer Satisfaction, HR, R&D, Project Implementation, Capital expenditure, Extent of Globalisation. Sector Specific Parameters consist of Order Book related parameters; Enterprise Specific Parameters include operational factors such as Inventory, Manpower Output, Outsourcing, etc. In all, there are 32 parameters as mentioned above, based on which the company's performance is evaluated.

Evaluation

In order to distinguish various performance levels, five different performance targets are fixed for each of the above parameters on a 1-5 point scale in the ascending order i.e., Excellent, Very Good, Good, Fair and Poor. The targets are fixed after deliberations / negotiations with DPE in the beginning of each financial year.

Raw Score

Raw Score reflects where 'Actual Performance' under each of the above parameters belongs in relation to the 5 point scale as above. Interpolation method is used to arrive at raw scores, if actual achievement falls between specified targets.

Composite Score

The Composite Score is an index of the performance of the company that is calculated based on the aggregation of all the weighted score of the actual achievements of each parameter vis-a-vis targets set out on the 5 point scale. The Composite Score may be (1), (2), (3), (4) or (5) or may have values in between.

Grading

Based on the composite score obtained, the company is awarded MoU Rating as follows:

MoU Composite Score Grading / Rating

1.00 to 1.50 Excellent

1.51 to 2.50 Very Good
2.51 to 3.50 Good
3.51 to 4.50 Fair
4.51 to 5.00 Poor

The MoU rating is awarded by DPE on the above basis at the end of each year based on the audited results of the company.

MoU Performance based on Audited Figures

2006-2007