MIRA INFORM REPORT

 

 

Report Date :

19th May 2006

 

IDENTIFICATION DETAILS

 

Name :

KHANNAH ELECTRICALS LIMITED

 

 

Registered Office :

D 10/6 Okhla Industrial Area, Phase – I, New Delhi – 110020, India

 

 

Country :

India

 

 

Financials (as on) :

31.03.2005

 

 

Date of Incorporation :

25/03/1980

 

 

CIN No.:

U74899DL1980PLC010303

 

 

Com. Reg. No.:

55-10303

 

 

TAN No.:

(Tax Deduction & Collection Account No.)

DELK05508G

 

 

PAN No.:

(Permanent Account No.)

AAACK0563B

 

 

Legal Form :

A Closely Held Public Limited Liability Company

 

 

Line of Business :

Manufacturers of fans, sheet metal, pumps and pumping equipments.

 

RATING & COMMENTS

 

MIRA’s Rating :

B

 

RATING

STATUS

PROPOSED CREDIT LINE

26-40

B

Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.

Small

 

Maximum Credit Limit :

 

 

 

Status :

Moderate

 

 

Payment Behaviour :

Slow by average 30 days

 

 

Litigation :

Clear

 

 

Comments :

Subject is a well established company having moderate track. Financial position is moderate. Profit margin is low. Payments are reported as slow but correct.

 

The company can be considered for small to mediocre business dealings on usual trade terms and conditions.

 

LOCATIONS

 

Registered Office :

D 10/6 Okhla Industrial Area, Phase – I, New Delhi – 110020, India

 

 

Factory :

Plot No. 102, Sector 6, Faridabad – 121006, Haryana

Tel No:

91-129-4061142/43

Mobile :

91-9810157333

Fax No. :

91-129-4061144

 

DIRECTORS

 

Name :

Mr. Naresh Kumar Khannah

Designation :

Director

Address :

E-207, Greater Kailash Part – II, New Delhi, Delhi – 110048

Date of Birth/Age :

10/10/19953

Date of Appointment :

25/03/1980

 

 

Name :

Ms. Neelum Khannah

Designation :

Director

Address :

E-207, Greater Kailash Part – II, New Delhi, Delhi – 110048

Date of Birth/Age :

25/05/1953

Date of Appointment :

25/03/1980

 

 

Name :

Ms. Neha Khannah

Designation :

Director

Address :

E-207, Greater Kailash Part – II, New Delhi, Delhi – 110048

Date of Birth/Age :

01/10/1977

Date of Appointment :

01/10/2000

 

 

Name :

Mr. Hemand Kumar Seth

Designation :

Director

Address :

102-B, Pocket – 14 Kalkaji Extn, New Delhi-110048

Date of Birth/Age :

12/10/1960

Date of Appointment :

23/09/1981

 

MAJOR SHAREHOLDERS

 

Names of Shareholders

No. of Shares

Naresh Kumar Khannah

66000

Neelum Khannah

38000

Dinesh Barman

6000

Pawan Malhotra

2000

Seth Kumar Hemant

12500

Naman Khannah

91500

 

 

 

BUSINESS DETAILS

 

Line of Business :

Manufacturers of fans, sheet metal, pumps and pumping equipments.

 

 

Products :

Item Code No (ITC Code)               Product Description

8414                                                   Fans
 
PRODUCTION STATUS

 

Particulars

Unit

 

Installed Capacity

Actual Production

Fans

In Nos.

 

78000

37756

 

GENERAL INFORMATION

 

No. of Employees :

200

 

 

Bankers :
  • Canara Bank
  • ICICI Bank

 

 

Facilities :

Secured Loans

31.03.2005

Cash and Credit Account (Canara Bank)

2.338

Term Loan from ICICI Bank

0.332

Total

2.670

 

 

Unsecured Loans

 

From Directors

3.549

From Shareholders

0.287

Shot Terms Loan

 

From Companies

0.870

Total

4.706

 

 

 

Banking Relations :

Satisfactory

 

 

Auditors :

Mr. Ravi and Associates

Chartered Accountants

L-42, Lajpat Nagar – II, New Dehli – 110024

Tel. No.:

91-11-29810918

 

CAPITAL STRUCTURE

 

Authorised Capital :

No. of Shares

Type

Value

Amount

3750000

Equity Shares

Rs. 10 each

 Rs. 37.500 millions

 

Issued, Subscribed & Paid-up Capital :

No. of Shares

Type

Value

Amount

 

Issued Capital

 

 

218000

Equity Shares

Rs. 10 each

 Rs.2.180 millions

 

Subscribed Capital

 

 

218000

Equity Shares

Rs. 10 each

 Rs.2.180 millions

 

Paid-up Capital

 

 

218000

Equity Shares

Rs. 10 each

 Rs.2.180 millions

 

 

FINANCIAL DATA

[all figures are in Rupees Millions]

 

ABRIDGED BALANCE SHEET

 

SOURCES OF FUNDS

 

31.03.2005

31.03.2004

31.03.2003

SHAREHOLDERS FUNDS

 

 

 

1] Share Capital

2.180

2.180

2.180

3] Reserves & Surplus

7.156

7.131

6.726
NETWORTH

9.336

9.311

8.906

LOAN FUNDS

 

 

 

1] Secured Loans

2.670

1.399

0.565

2] Unsecured Loans

4.707

4.919

5.015
TOTAL BORROWING

7.377

6.318

5.580

DEFERRED TAX LIABILITIES

--

--

--
 

 

 

 
TOTAL

16.713

15.629

14.486
 

 

 

 
APPLICATION OF FUNDS

 

 

 
 

 

 

 
FIXED ASSETS [Net Block]

8.686

8.761

8.818
Capital work-in-progress

0.592

0.625

0.415
 

 

 

 
INVESTMENT

--

--

--
DEFERREX TAX ASSETS

 

 

 
 

 

 

 
CURRENT ASSETS, LOANS & ADVANCES

 

 

 
 
Inventories
5.211

4.277

4.315
 
Sundry Debtors
6.256

5.060

4.829
 
Cash & Bank Balances
0.083

0.640

0.415
 
Other Current Assets
0.000

0.000

0.000
 
Loans & Advances
1.263

0.925

1.311
Total Current Assets
12.813

10.902

10.870
Less : CURRENT LIABILITIES & PROVISIONS
 

 

 
 
Current Liabilities
5.378

4.659

5.617
 
Provisions
 

 

 
Total Current Liabilities
5.378

4.659

5.617
Net Current Assets
7.435

6.243

5.253
 

 

 

 
MISCELLANEOUS EXPENSES

--

--

--
 

 

 

 
TOTAL

16.713

15.629

14.486

 

PROFIT & LOSS ACCOUNT

 

PARTICULARS

 

31.03.2005

31.03.2004

31.03.2003
Sales Turnover [including other income]

24.083

22.511

19.595
 

 

 

 
Profit/(Loss) Before Tax

0.028

0.438

0.042
Provision for Taxation

0.003

0.034

0.092
Profit/(Loss) After Tax

0.025

0.404

0.134
 

 

 

 
Export Value

0.742

1.711

NA
 

 

 

 
Total Expenditure

24.055

21.459

19.286

 

 

KEY RATIOS

 

PARTICULARS

 

 

31.03.2005

31.03.2004

31.03.2003
PAT / Total Income
(%)
0.103

1.794

0.683
 
 
 

 

 
Net Profit Margin

(PBT/Sales)

(%)
0.116

1.945

0.214
 

 
 

 

 
Return on Total Assets

(PBT/Total Assets}

(%)
0.126

2.158

0.208
 

 
 

 

 
Return on Investment (ROI)

(PBT/Networth)

 
0.003

0.047

0.005
 

 
 

 

 
Debt Equity Ratio

(Total Liability/Networth)

 
1.366

1.178

1.257
 

 
 

 

 
Current Ratio

(Current Asset/Current Liability)

 
2.382

2.339

1.935

 

 

 

LOCAL AGENCY FURTHER INFORMATION

 

Fixed Assets :

 

 

 

 

FORM NO. 8

Registration No of Company 55-10303                                       THE COMPANIES  ACT, 1956

 

Particulars of Charges created by a company registered in India

(Pursuant to sections 125/127/135)

 

Name of the Company     KHANNAH ELECTRICALS LIMITED

Presented by Mr.             CANARA BANK, LAJPAT NAGAR, NEW DELHI - 110024

 

 
  1. Date and description of instrument creating the change

17/01/2001

Agreement for CDB/SDB/BE Advance.
  1. Amount secured by the charge/amount owing on the securities of charge

Rs. 5.000 millions
  1. Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

Advances against cheques / hundies / drafts or Bill of Exchange whatever may be the tenor thereof drawn, accepted or endorsed by the Borrower with or without documents such as railway receipts, lorry receipts , airway bills, post parcel receipts, bill of lading or any other documents of title to the goods, invoices, etc.
  1. Gist of the terms and conditions and extent and operation of the charge.

Interest on all amounts payable under the BE/LBD Limit shall be charged at the rate of 15.25 percent per annum with quarterly rests or at such other rate (s) as may be specified by the bank from time to time.
  1. Name and Address and description of the person entitled to the charge.

Canara Bank, Lajpat Nagar
  1. Date  and brief description of instrument modifying the charge

Not Applicable
  1. Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

Not Applicable

 

 
  1. Date and description of instrument creating the change

26/11/1980 -  Registered on 08/12/1981 Agreement
  1. Amount secured by the charge/amount owing on the securities of charge

Rs. 0.150 millions
  1. Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

Hypothecation of raw – materials, work-in-process and finished goods and such other goods belonging to the company
  1. Gist of the terms and conditions and extent and operation of the charge.

Interest to be charged at the rate of 6.65 percent per annum over RBI rate subject to a minimum of 15.65 percent per annum.

Margin : 25 percent           Payable on demand
  1. Name and Address and description of the person entitled to the charge.

Canara Bank,

Lajpat Nagar

New Delhi – 110024
  1. Date  and brief description of instrument modifying the charge

08/12/2000

Agreement Reg. : Collateral Security

 

Previously modified on 26/05/1984, 28/05/1985, 08/11/1989, 20/06/1990, 31/10/1994, 31/10/1994, 07/09/1995, 07/09/1995, 17/11/1995 again on 17/11/1995 for change in terms and conditions for the enhanced limit of Rs. 1.500 millions and modified charge registered with ROC on 18/12/1995
  1. Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

The cash credit limit of Rs. 1.500 millions shall also be collaterally secured by way of additional security in favour of the bank all the book debts and also stocks in trade as described in schedule ‘A’ hereto and stock / work in progress kept / to be kept or in transit of at premise in the occupation of the borrower. Other terms and conditions remained the same .

 

 
  1. Date and description of instrument creating the change

17/11/1995- Registered on 18/12/1995 agreement
  1. Amount secured by the charge/amount owing on the securities of charge

Rs. 3.500 millions

  1. Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

Collaterally secured by plant and machinery installation at D-10/6, Okhla Industrial Area, Phase – I, New Delhi, valued at Rs. 1.767 as at 31.03.1995 as per list attached.
  1. Gist of the terms and conditions and extent and operation of the charge.

Interest /Commission as per bank rules.
  1. Name and Address and description of the person entitled to the charge.

Canara Bank, Lajpat Nagar, New Delhi – 110024
  1. Date  and brief description of instrument modifying the charge

08/12/2000

Agreement Reg : Collaterally Security ( Book – Debts, Stocks including work – in progress, inventory )

Previously modified on 17/11/1995 for change in terms and condition and finally modified on 09/03/1998 to enhanced the limit from Rs. 3.500 millions to Rs. 4.500 millions and modified charge registered on 27/04/1998
  1. Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

The BE Limit of Rs. 4.500 millions  shall also be collaterally secured by way of additional security in favour of the bank all the book – debts and also stock – in –trade, described  in schedule ‘A’ hereto and stock /work in progress kept / to be kept or in transit or at the premises in the occupation of the borrowers.

 

 
  1. Date and description of instrument creating the change

26/11/1980 -  Registered on 08/12/1981 Agreement
  1. Amount secured by the charge/amount owing on the securities of charge

Rs. 0.150 millions
  1. Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

Hypothecation of raw – materials, work-in-process and finished goods and such other goods belonging to the company
  1. Gist of the terms and conditions and extent and operation of the charge.

Interest to be charged at the rate of 6.65 percent per annum over RBI rate subject to a minimum of 15.65 percent per annum.

Margin : 25 percent           Payable on demand
  1. Name and Address and description of the person entitled to the charge.

Canara Bank,

Lajpat Nagar

New Delhi – 110024
  1. Date  and brief description of instrument modifying the charge

06/07/2002

Supplemental Agreement

 

Previously modified from time ot time and finally modified on 08/12/2002 for change in terms and conditions for the enhanced limit of Rs. 1.500 millions and modified charge registered with ROC on 09/01/2001
  1. Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

The OCC Limit Stands enhanced from Rs. 1.500 millions to Rs. 2.000 millions.

The rate of interest shall now be charged at the rate of 1.75 percent per annum above ongoing PLR subject to a minimum of 13.25 percent per annum with quarterly rests or at such other rate (s) as may be specified by the bank from time to time.

Other terms and conditions remains the same.

 

 
  1. Date and description of instrument creating the change

Charge created on 26/11/1980 and  Registered on 08/12/1981 modified on 8/08/1989  and registered on 23/01/1990 for Rs. 0.300 millions. Modified on 7/09/1995 and reqired . on  13/10/1995 for Rs. 0.675 millions. Modified on 17/11/1995 and registered on 18/12/1985 for Rs. 1.500 millions.
  1. Amount secured by the charge/amount owing on the securities of charge

Rs. 0.150 millions
  1. Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

Hypothecation of whole of the Borrower’s stocks of  raw – materials, work-in-process and finished goods and such other goods belonging to the company including book-debts.
  1. Gist of the terms and conditions and extent and operation of the charge.

Interest to be charged at the rate of 6.65 percent per annum over RBI rate subject to a minimum of 15.65 percent per annum.

Margin : 20 percent           Payable on demand
  1. Name and Address and description of the person entitled to the charge.

Canara Bank,

Lajpat Nagar

New Delhi – 110024
  1. Date  and brief description of instrument modifying the charge

Supplemental Agreement dated : 13/01/2005

 
  1. Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

Extent of operation of charge stand enhanced to secured extended OCC Limit of Rs. 2.000 millions together with the interest @ 1.85% over and above ongoing PLR with a minimum of 12.60% p. a. or at such other rate (s) as may be specified by the bank from time to time.

Other terms and conditions remains the same.

 

 

 

 

 

 

 

CMT REPORT [Corruption, Money laundering & Terrorism]

 

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

 

1]         INFORMATION ON DESIGNATED PARTY

No records exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

 

2]         Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

 

3]         Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

 

4]         Record on Financial Crime :

            Charges or conviction registered against subject:                                                   None

 

5]         Records on Violation of Anti-Corruption Laws :

            Charges or investigation registered against subject:                                                           None

 

6]         Records on Int’l Anti-Money Laundering Laws/Standards :

            Charges or investigation registered against subject:                                                           None

 

7]         Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

 

8]         Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

 

9]         Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

 

10]       Press Report :

            No press reports / filings exists on the subject.

 

 

CORPORATE GOVERNANCE

 

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

 

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

 

 

CONTRAVENTION

 

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.45.52

UK Pound

1

Rs.85.79

Euro

1

Rs.58.46

 

 

SCORE & RATING EXPLANATIONS

 

SCORE FACTORS

 

RANGE

POINTS

HISTORY

1~10

5

PAID-UP CAPITAL

1~10

3

OPERATING SCALE

1~10

3

FINANCIAL CONDITION

 

 

--BUSINESS SCALE

1~10

3

--PROFITABILIRY

1~10

3

--LIQUIDITY

1~10

3

--LEVERAGE

1~10

3

--RESERVES

1~10

3

--CREDIT LINES

1~10

3

--MARGINS

-5~5

--

DEMERIT POINTS

 

 

--BANK CHARGES

YES/NO

YES

--LITIGATION

YES/NO

NO

--OTHER ADVERSE INFORMATION

YES/NO

NO

MERIT POINTS

 

 

--SOLE DISTRIBUTORSHIP

YES/NO

NO

--EXPORT ACTIVITIES

YES/NO

YES

--AFFILIATION

YES/NO

NO

--LISTED

YES/NO

NO

--OTHER MERIT FACTORS

YES/NO

YES

TOTAL

 

29

 

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)              Ownership background (20%)                   Payment record (10%)

Credit history (10%)                    Market trend (10%)                                  Operational size (10%)

 

 

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.

Satisfactory

26-40

B

Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.

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

 

 

 

 

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions