Attachment 1
|
Report
Update On |
20th April, 1999 |
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|
|
|
Report on |
PUNJAB COMMUNICATIONS LIMITED |
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|
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|
Registered Office |
C-135
Phase VIII, Industrial Area, S. A. S. Nagar, P. O. Box 3, Punjab – 160 059,
INDIA |
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Tel. No. |
91-172-670 688 / 674 980 / 675 467 / 674 476 |
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Fax No. |
91-172-671 492 / 675 468 |
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E-Mail |
-- |
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Telex |
-- |
Attachment 2
S U M M A R Y
|
Incorporated |
1981 |
Status |
Satisfactory |
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|
|
|
|
|
|
Registration No. |
4616 |
Chief Executive |
Mr. A. S. Gill |
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|
|
|
|
|
|
|
Capital (Rs.) |
160.559 |
Payments |
Regular |
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|
|
|
|
|
|
|
Sales (Rs.) |
860.939 |
Litigation |
-- |
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|
|
|
|
|
|
|
Net Worth (Rs.) |
1,794.244 |
Banking Reputation |
Satisfactory |
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No. of Employees |
1,100 |
Auditors |
Datta Singla & Company |
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Credit Rating |
Ba (See attachment 3) |
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||
INDUSTRY
The basic services have recorded substantial high growth during the last decade with a rate of growth of 16-17% per annum. Department of Telecommunications and Mahanagar Telephone Nigam Limited together added 3.26 million new telephone connections during financial year 98. The number of connections in the country has increased to 17.80 millions as on 31st March, 1998. The Ninth Five Year Plan envisages a provision of 18.50 million lines during 1997-2002. In Cellular Services, 21 city/circles are witnessing same action with total subscriber base of approximately 769074. Domestic environment manufacturers have not been able to do well in recent times, on account of intencified competition. Private players are entering into supplier credit contracts with the international equipment suppliers, which the domestic industry is finding difficult to emulate because of lack of financial strengthened technical capabilities.
************************
FACTORY
C-134, C-135 and B-93, Phase VIII, Industrial Area, S. A. S. Nagar, Mohali, Punjab, INDIA
HISTORY
The company was incorporated on 21st July, 1981 at Punjab by Punjab Electronics Development & Production Corporation Limited having Company Registration Number 16-4616.
LEGAL FORM
It is a Punjab State Government Undertaking Public Limited Liability company. The company’s shares are listed on the Stock Exchange.
DIRECTORS
|
Mr. Ramesh Inder Singh, IAS |
Chairman |
|
Mr. A. Didar Singh, IAS |
Vice-Chairman |
|
Mr. A. S. Gill |
Managing
Director |
|
Mr. Rajan Kashyap, IAS |
Director |
|
Mr. Y. S. Ratra, IAS |
Director |
|
Mr. V. P. Chandan |
Director |
|
Mr. Kranti Kumar |
Director |
|
Mr. Arun Kumar |
Director |
|
Mr. A. K. Bhargava` |
Director |
|
Mr. R. K. Nangia |
Director |
|
Mr. Sanjeev Vashista |
Company
Secretary |
BUSINESS
The company is engaged in manufacturing and marketing of DTL (Chnl.), PCL (Chnls. & Terminals), Radio (Sys.), M/W Radio (TR), T MUX (TR), RAX/MAX/SBM RAX (Lines), OLTE (TR), 2 GHZ (TR) and VSAT (TR)
The company’s production status as on 31st March, 1998 was as under :
|
PARTICULARS |
Licensed Capacity |
Installed Capacity |
Actual Production |
|
|
|
|
|
|
DTL
(Chnl.) |
5,000 |
5,000 |
302 |
|
PCM
(Chnls.) |
30,000 |
11,250 |
240 |
|
PCM
(Terminals) |
1,000 |
375 |
18 |
|
Radio
(Sys.) |
100 |
100 |
62 |
|
M/W
Radio (TR) |
200 |
200 |
13 |
|
T
MUX (TR) |
200 |
200 |
11 |
|
RAX/MAX/SBM
RAX (Lines) |
170,000 |
120,000 |
107,256 |
|
OLTE
(TR) |
1,000 |
500 |
829 |
|
2
GHZ (TR) |
50 |
30 |
0 |
|
VSAT
(TR) |
200 |
200 |
69 |
Generic Names of Principal Products of the Company are :
|
Item Code No. (ITC Code) |
8517 |
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Product Description |
Multiplexer |
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|
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Item Code No. (ITC Code) |
8517 |
|
Product Description |
Electronic
Switching Equipments |
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|
|
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Item Code No. (ITC Code) |
8529 |
|
Product Description |
DTL
Systems |
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|
|
|
Item Code No. (ITC Code) |
8525 |
|
Product Description |
Ratio
Systems |
The management states in its latest audited annual report for the period ended 31st March, 1998 that the year 1997-98 was the third consecutive year in which the telecom industry had to face the major brunt of sluggish economy coupled with tremendous pressure on the prices brought in by the mushrooming numbers of non-serious entrants in the telecom field. Despite the cut throat competition prevalant in the telecom sector seems to be clearing now after witnessing a shake out in the industry. The new players, who were aspiring to take up their share of the cake in this supposedly lucrative market by booking orders even below their cost, have now realised that price under cutting is not the right policy. The company has been subject to many other constraints for the reasons beyond its control, yet it is a matter of pride that the company has succeeded in converting these constraints into opportunities by sheer team work, firm determination to excel, strong fundamentals, intensive, R&D, cost effective measures that has made PUNCOM some force to reckon with the telecom sector.
The company has generated a gross income of Rs.912.453 millions against Rs.748.471 million in the year 1996-97 and the book value per share is Rs,111.75. The reserves of the company stand at a solid figure of Rs.1,633.685 millions. One of the salient features of 1997-98 results has been that the net cash inflow from operating activities was Rs.52.218 millions against a negative cash flow of Rs.3.438 millions during the last year 1996-97.
The steady performance of PUNCOM during the turbulent economic period of 1997-98 underlines the sound foundation of the company even as an unprecedented downturn existence in those segments in which the company operates. One of the reasons to offset the adverse impact of sluggish economy was close monitoring of the controllable expenses and concentrating on the core activities only.
The company imports Raw Materials, Components & Spare and Capital Goods from Europe and Far East against L/C terms.
The company’s fixed assets of important value includes Leasehold Land, Building, Plant & Machinery, R&D Capital Goods, Temporary Structure, Electrical Installation, Office Equipment, Furniture & Fixtures, Vehicles and Other Assets.
The company employs around 1,100 persons.
SUBSIDIARIES
K PCL Telecom Limited
BANKERS
K State Bank of India
K Union Bank of India
K Indusind Bank Limited
K Bank of Rajasthan Limited
AUDITORS
K Datta Singla & Company
Chartered Accountants
FINANCIAL INFORMATION
The company's latest financial information for the period ended 31st March, 1998 is enclosed herewith.
CAPITAL STRUCTURE
|
Authorised Capital : |
||
|
19,800,000 |
Equity Shares of Rs.10/- each |
Rs.198.000 millions |
|
20,000 |
Redeemable Preference Shares of Rs.100/- each |
Rs. 2.000 millions |
|
GRAND TOTAL |
Rs.200.000 millions |
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|
|
||
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Issued, Subscribed &
Paid-up Capital : |
||
|
16,105,420 |
Equity Shares of Rs.10/- each |
Rs.161.054 millions |
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Less : |
Calls in Arrears |
Rs. 0.495 millions |
|
GRAND TOTAL |
Rs.160.559 millions |
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COMMENTS
Subject is a Punjab State Government Undertaking. Directors are highly qualified, respectable and experienced professionals. Their trade relations are fair. General financial position is satisfactory. The company’s profitability is under severe pressure. Payments are usually correct and as per commitments. Management is hopeful for the better results in the current year.
The company can be considered for any normal business dealings at usual trade terms and conditions.
Your proposed business dealings of US$ 29,000 – 90 days can be recommended.
The company can be regarded as a promising business partner in a long-run.
ABRIDGED BALANCE SHEET AS ON
31ST March, 1998
[figures are in Rupees Millions]
|
SOURCES OF FUNDS |
|
31.03.1998 |
31.03.1997 |
|
SHAREHOLDERS FUNDS |
|
|
|
|
1] Share Capital |
|
160.559 |
160.559 |
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2] Reserves & Surplus |
|
1,633.685 |
1,633.595 |
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LOAN FUNDS |
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|
|
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1] Secured Loans |
|
22.185 |
56.653 |
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2] Unsecured Loans |
|
21.170 |
22.559 |
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|
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GRAND TOTAL
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|
1,837.599 |
1,873.366 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
|
394.549 |
341.288 |
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Capital work-in-progress |
|
0.000 |
49.630 |
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INVESTMENTS |
|
212.647 |
242.566 |
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CURRENT ASSETS, LOANS & ADVANCES |
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|
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Inventories |
|
369.957 |
372.244 |
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Sundry Debtors |
|
360.753 |
307.077 |
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Cash & Bank Balances |
|
261.105 |
164.772 |
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Other Current Assets |
|
30.369 |
18.563 |
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Loans & Advances |
|
275.648 |
474.269 |
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Total Current Assets |
|
1,297.832 |
1,336.925 |
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Less : |
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Current Liabilities |
|
93.985 |
120.367 |
Provisions |
|
7.948 |
17.661 |
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Net Current Assets |
|
1,195.899 |
1,198.897 |
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MISCELLANEOUS EXPENSES |
|
34.504 |
40.985 |
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GRAND TOTAL
|
|
1,837.599 |
1,873.366 |
IMPORTANT FINANCIAL
INFORMATION FOR LAST TWO PERIODS
[figures are in Rupees Millions]
|
PARTICULARS |
|
31.03.1998 |
31.03.1997 |
|
Sales Turnover |
|
860.939 |
793.291 |
|
[including other income] |
|
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Profit/(Loss) Before Tax |
|
17.859 |
35.111 |
|
Provision for Taxation |
|
1.000 |
4.529 |
|
Profit/(Loss) After Tax |
|
16.859 |
30.582 |
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Earnings in Foreign Currency : |
|
|
|
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Export Earnings |
|
23.198 |
14.323 |
|
Other Earnings |
|
0.000 |
0.000 |
|
Total Earnings |
|
23.198 |
14.323 |
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Imports : |
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|
|
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Raw Materials |
|
160.198 |
99.578 |
|
Components & Spares |
|
0.318 |
0.540 |
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Capital Goods |
|
28.247 |
16.853 |
Total Imports
|
|
188.763 |
116.971 |
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Expenditures :
|
|
|
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Consumption
of Raw Materials |
|
410.074 |
389.913 |
|
Manufacturing
Expenses |
|
27.603 |
19.180 |
|
Excise
Duty |
|
97.485 |
72.224 |
|
Administration
& Other Expenses |
|
30.673 |
31.477 |
|
Personnel
Costs |
|
153.167 |
91.076 |
|
Selling
& Distribution Costs |
|
44.297 |
28.628 |
|
Financial
Charges |
|
12.122 |
12.941 |
|
Research
& Development Charges |
|
0.000 |
25.736 |
|
Amount
Written-off |
|
6.524 |
23.629 |
|
Provision
for Doubtful Debts & Advances |
|
3.981 |
7.646 |
|
Depreciation |
|
57.154 |
55.731 |
Total Expenditures
|
|
843.080 |
758.181 |
important key ratios for
three periods
|
PARTICULARS |
31.03.1997 |
31.03.1996 |
31.03.1995 |
|
Per Share
Ratios (Rs.) |
|
|
|
|
*Adjusted E P S |
4.71 |
12.57 |
213.78 |
|
*Reported E P S |
4.13 |
12.52 |
210.71 |
|
Dividend Per Share |
1.00 |
4.00 |
20.00 |
|
*Operating Profit Per Share |
1.99 |
19.34 |
450.75 |
|
*Net Operating Income Per Share |
35.47 |
62.47 |
1,288.91 |
|
Free Reserves Per Share |
95.99 |
93.04 |
670.33 |
|
|
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Profitability
Ratios (%) |
|
|
|
|
Operating Margin |
5.61 |
30.95 |
34.97 |
|
Gross Profit Margin |
-0.57 |
28.50 |
32.43 |
|
Net Profit Margin |
10.88 |
18.53 |
16.55 |
|
*Adjusted Return On Net Worth |
4.45 |
12.21 |
31.42 |
|
*Reported Return On Net Worth |
3.90 |
12.16 |
30.97 |
|
*Return On long Term Funds |
6.23 |
18.55 |
49.08 |
|
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Leverage
Ratios |
|
|
|
|
Long Term Debt/Equity |
0.05 |
0.16 |
0.24 |
|
Total Debt/Equity |
0.05 |
0.16 |
0.71 |
|
*Fixed Assets Turnover Ratio |
1.07 |
3.40 |
3.67 |
|
|
|
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Liquidity
Ratios |
|
|
|
|
Current Ratio |
9.82 |
11.21 |
4.68 |
|
Quick Ratio |
6.84 |
9.22 |
2.64 |
|
*Inventory Turnover Ratio |
1.61 |
3.90 |
2.86 |
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|
|
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Payout Ratios
(%) |
|
|
|
|
Dividend Payout Ratio (Net Profit) |
21.29 |
20.15 |
9.36 |
|
Dividend Payout Ratio (Cash Profit) |
13.65 |
17.59 |
8.11 |
|
Earnings Retention Ratio |
78.71 |
79.85 |
90.64 |
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|
|
|
|
|
Coverage Ratio |
|
|
|
|
Financial Charges Coverage Ratio |
6.43 |
8.20 |
5.22 |
Attachment 3
|
SCORE SHEET |
|
SCORE |
CREDIT RATING |
STATUS |
PROPOSED CREDIT LINE |
|
>86 |
Aaa |
Possesses an extremely sound financial base with the
strongest capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution
needed for credit transaction. It has above average (strong) capability for payment
of interest and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded
healthy. General unfavourable factors will not cause fatal effect.
Satisfactory capability for payment of interest and principal sums |
Fairly
Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to
meet normal commitments. Maybe drawn to slightly difficult position as
unfavourable conditions arise. Minimal assurance for timely payment on
interest and principal sums |
Moderate |
|
26-40 |
B |
Unfavourable & favourable factors carry similar
weight in credit consideration. Capability to overcome financial difficulties
seems comparatively limited or considered not known. Capability to pay both
interest and principal sums is doubtful |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest
and principal sums in default or expected to be in default upon maturity |
Limited
with full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be
exercised |
Credit
not recommended |
Attachment 4
INDIA
INDIA, a Union of States, is a Sovereign Socialist Secular Democratic Republic with a Parliamentary System of government. It covers an area of 32872631 sq. km. Population, as on 1st March, 1991 (last counted) stood at 846.30 millions.
The value of total foreign trade increased to Rs.2,778,392.8 millions in 1997-98. During 1997-98, it’s total exports amounted to Rs.1,262,857.6 millions and imports increased to Rs.1,515,535.2 millions.
As on 20th April, 1999, Standard and Poor’s affirmed its ratings for India and said the country’s outlook was stable despite weak coalition governments. S&P affirmed its BB foreign currency and the BBB local currency ratings for India. The B foreign currency and A3 local currency short-term issuer credit ratings were also affirmed. The outlook is stable. Official foreign exchange reserves cover about 165 percent of total government, public sector and private sector external principal-repayment obligations due within the next 12 months. At $32.6 billion as on April 7, 1999, they mitigate the risk of a sudden loss of external confidence even as exports decelerate and the trade gap widens, the agency said.
LEADING EONOMIC INDICATORS
|
|
Outstanding As On |
% Variation Over |
|||
|
Banking, M3 & Forex (Rs. mlns.) |
Feb. 26, 1999 |
End-March 1998 |
Financial Year So Far |
Year Ago |
|
|
1997-98 |
1998-99 |
||||
|
|
|
|
|
|
|
|
Aggregate Deposits |
6,983,380 |
6,054,100 |
15.3 |
15.3 |
19.8 |
|
Demand Deposits |
1,029,500 |
1,025,130 |
0.2 |
0.4 |
13.4 |
|
Time Deposits |
5,953,880 |
5,028,970 |
18.7 |
18.4 |
20.9 |
|
Investments |
2,519,660 |
2,187,050 |
12.3 |
15.2 |
17.7 |
|
Government Securities |
2,203,170 |
1,869,570 |
14.2 |
17.8 |
21.4 |
|
Other Approved Securities |
316,490 |
317,480 |
2.7 |
-0.3 |
-2.3 |
|
Bank Credit |
3,547,420 |
3,240,790 |
12.4 |
9.5 |
13.3 |
|
Food Credit |
167,320 |
124,850 |
62.4 |
34.0 |
35.6 |
|
Non-food Credit |
3,380,110 |
3,115,940 |
11.0 |
8.5 |
12.4 |
|
Money Supply M3 (Feb. 26, 1999) |
9,455,060 |
8,253,890 |
13.4 |
14.6 |
18.8 |
|
Net Bank Credit to Government |
3,868,200 |
3,306,190 |
11.4 |
17.0 |
20.3 |
|
Reserve Bank Credit to
Government |
1,543,690 |
1,351,600 |
5.1 |
14.2 |
18.3 |
|
Bank Credit to Commercial
Sector |
4,651,290 |
4,321,900 |
11.8 |
7.6 |
10.6 |
|
FOREX (US$ mln.) March 19, 1999 |
312,350 |
293,670 |
7.0 |
6.4 |
10.5 |
|
Foreign Currency Assets |
282,560 |
259,750 |
11.1 |
8.8 |
13.7 |
FOREIGN INSTITUTIONAL INVESTMENT IN INDIA
|
Financial Year |
Gross Purchases (Rs. mlns.) |
Gross Sales (Rs. mlns.) |
Net Investment (Rs. mlns.) |
|
|
|
|
|
|
1992-93 |
175 |
40 |
135 |
|
1993-94 |
55,927 |
4,665 |
51,262 |
|
1994-95 |
76,310 |
28,354 |
47,966 |
|
1995-96 |
96,930 |
27,520 |
69,420 |
|
1996-97 |
155,540 |
69,804 |
85,746 |
|
1997-98 |
186,948 |
127,373 |
59,577 |
|
1998-99 |
161,150 |
176,993 |
-15,844 |
|
Total |
732,980 |
434,749 |
298,262 |