MIRA
INFORM REPORT
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Report Date : |
04.11.2006 |
IDENTIFICATION
DETAILS
|
Name : |
VULCAN
ENGINEERS LIMITED |
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Registered Office : |
427, Unique
Industrial Estate, Off Veer Savarkar Marg, Prabhadevi, Mumbai – 400 025,
Maharashtra |
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Country : |
India |
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Financials (as on) : |
31.03.2006 |
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Date of Incorporation : |
20.12.1963 |
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Com. Reg. No.: |
11-12801 |
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CIN No.: [Company
Identification No.] |
U12801MH1963PLC012801 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
MUMV10107G |
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PAN No.: [Permanent
Account No.] |
AAACV1736D |
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Legal Form : |
Public Limited Liability Company. The company’s shares are listed on the Stock Exchanges. |
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Line of Business : |
Engaged in the business of design,
engineering, manufacture, erection and commissioning of custom-build industrial
furnaces, like kilns and producer gas plants (referred to as “industrial
plants”) on turnkey basis as well as on the basis of divisible
contracts. |
RATING & COMMENTS
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MIRA’s Rating : |
B |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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26-40 |
B |
Unfavourable & favourable factors
carry similar weight in credit consideration. Capability to overcome
financial difficulties seems comparatively below average/normal. |
Small |
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Maximum Credit Limit : |
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Status : |
Moderate |
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Payment Behaviour : |
Slow
and delayed |
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Litigation : |
Clear |
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Comments : |
Subject
is a listed company having moderate track.
It incurrs losses. Business
shows downward trend. Financial
position is moderate. Payments are
slow and delayed. The
company can be considered for moderate business dealings with some caution. |
LOCATIONS
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Registered Office : |
427, Unique Industrial Estate, Off Veer Savarkar Marg, Prabhadevi,
Mumbai – 400 025, Maharashtra, India |
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Tel. No.: |
91-22-24304529 / 24304659 / 24303671 |
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Fax No.: |
91-22-24225814 |
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E-Mail : |
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Factory
: |
Plot No. B-21, MIDC Industrial Area, Ahmednagar – 414001, Maharashtra |
DIRECTORS
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Name : |
Mrs. Sheila M. Malaney |
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Designation : |
Chairperson
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Date of Birth/Age : |
62 years |
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Qualification : |
Graduate in Economics (Hons.) |
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Experience : |
33 years experience in the field of
project management, accounts and finance |
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Date of Appointment : |
14.08.1998 |
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Name : |
Mr. A. T. Vaswani |
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Designation : |
Vice
Chairman |
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Name : |
Mr. Admiral L. Ramdas |
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Designation : |
Director
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Name : |
Mr. Sanjeev M. Malaney |
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Designation : |
Director
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Name : |
Mr. Vikram M. Malaney |
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Designation : |
Director
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Date of Birth/Age : |
36 years |
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Qualification : |
Graduate in Computer Science (USA) |
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Experience : |
10 years experience in the computer technology for industrial/commercial application in USA, and also in designing and programming software for telecommunication products and turnkey applications. |
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Date of Appointment : |
01.11.1989 |
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Previous
Employment : |
Centigram Communications Inc., USA |
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Name
: |
Mr. Juergen Mendheim |
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Designation
: |
Director
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Name
: |
Mr. P. M. Kumar |
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Designation
: |
Director
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Name
: |
Mr. Anil Deshpande |
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Designation
: |
Chief Executive Officer |
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Date
of Birth/Age : |
54 years |
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Qualification
: |
B. Tech (Hons) in Chemical Technology
(IIT Mumbai) PGDM (IIM Kolkata) |
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Experience
: |
30 years |
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Date
of Appointment : |
09/08/1999 |
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Previous
Employment : |
Praj Industries Limited, Pune, Maharashtra |
MAJOR SHAREHOLDERS
|
Names
of Shareholders |
No. of Shares |
Percentage of Shareholding |
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Promoters |
1687240 |
34.86 |
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Persons acting in concert |
901840 |
18.63 |
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Mutual Funds and UTI |
200 |
0.00 |
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Banks, Financial Institution & Insurance Companies |
900 |
0.02 |
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Private Corporate Bodies |
207255 |
4.28 |
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Indian Public |
2029872 |
41.95 |
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NRIs/ OCBs |
9291 |
0.19 |
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Other (Clearing) |
3402 |
0.07 |
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Total: |
4840000 |
100.00 |
BUSINESS DETAILS
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Line of Business : |
Engaged in the business of design,
engineering, manufacture, erection and commissioning of custom-build
industrial furnaces, like kilns and producer gas plants (referred to as
“industrial plants”) on turnkey basis as well as on the basis of divisible
contracts. |
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Products: |
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Exports to : |
Austria, Germany, Indonesia, Mexico,
Nepal, Nigeria and USA [Design & Engineering and Components of Industrial
Plants] |
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Imports from : |
Austria, Germany and USA [Technical
knowhow and Instrumentation] |
GENERAL
INFORMATION
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No. of Employees : |
About
30 |
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Bankers : |
Canara Bank, Prabhadevi, Mumbai - 400 025, Maharashtra ICICI Bank Limited |
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Facilities: |
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Banking Relations : |
Unknown
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Auditors : |
Suresh Surana & Associates Chartered Accounts, 410, Dalamal Chambers, 29, New Marine Lines, Mumbai – 400 020, Maharashtra |
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Associates : |
v Vulcan Boilers Limited v Vulcan Eclipse Private Limited v Sanvico Construction Company Private Limited v Malaney Consultants Private Limited v Malaney Enterprises Private Limited v Mabor Surface Finishing Equipments Private Limited v Techlima Air Technology Private Limited |
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Subsidiaries : |
v Vulcan Exports Limited |
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Memberships : |
v Confederation of Indian Industry |
CAPITAL STRUCTURE
Authorised
Capital :
|
No.
of Shares |
Type |
Value |
Amount |
|
11000000 |
Equity Shares |
Rs. 10/- each |
Rs. 110.000 millions |
Issued,
Subscribed & Paid-up Capital :
|
No.
of Shares |
Type |
Value |
Amount |
|
4840000 |
Equity Shares |
Rs. 10/- each |
Rs. 48.400 millions |
FINANCIAL DATA
[all figures are in Rupees
Millions]
ABRIDGED
BALANCE SHEET
|
SOURCES OF FUNDS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
48.400 |
48.400 |
48.400 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
0.597 |
[56.100] |
[47.600] |
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4] (Accumulated Losses) |
[57.988] |
0.000 |
0.000 |
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NETWORTH |
[8.991] |
[7.700] |
0.800 |
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LOAN FUNDS |
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1] Secured Loans |
0.000 |
0.000 |
0.000 |
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2] Unsecured Loans |
9.758 |
9.400 |
4.700 |
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TOTAL BORROWING |
9.758 |
9.400 |
4.700 |
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DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
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TOTAL |
0.767 |
1.700 |
5.500 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
2.916 |
2.800 |
3.200 |
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Capital work-in-progress |
0.000 |
0.000 |
0.000 |
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INVESTMENT |
0.000 |
0.000 |
0.000 |
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DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
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CURRENT ASSETS, LOANS & ADVANCES |
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Inventories |
2.787
|
0.000
|
0.000 |
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Sundry Debtors |
11.483
|
11.800
|
12.800 |
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Cash & Bank Balances |
2.709
|
1.600
|
1.700 |
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Other Current Assets |
0.031
|
0.000
|
0.000 |
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Loans & Advances |
2.732
|
4.000
|
4.400 |
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Total Current Assets |
19.742 |
17.400
|
18.900 |
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Less : CURRENT LIABILITIES & PROVISIONS |
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Current Liabilities |
20.954
|
17.900
|
16.000 |
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Provisions |
0.937
|
0.600
|
0.600 |
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Total Current Liabilities |
21.891 |
18.500
|
16.600 |
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Net Current Assets |
[2.149] |
[1.100]
|
2.300 |
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MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
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TOTAL |
0.767 |
1.700 |
5.500 |
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PROFIT
& LOSS ACCOUNT
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
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Sales Turnover [including other income] |
67.180 |
16.100 |
36.100 |
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Profit/(Loss)
Before Tax |
[0.186] |
[8.300] |
[2.200] |
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Provision
for Taxation |
[0.202] |
0.000 |
0.000 |
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Profit/(Loss)
After Tax |
[0.388] |
[8.300] |
[2.200] |
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Import
Value |
0.053 |
0.028 |
NA |
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Export
Value |
0.000 |
0.827 |
N.A. |
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Total
Expenditure |
67.367 |
24.400 |
38.300 |
QUARTERLY
RESULTS
|
PARTICULARS |
|
|
30.06.2006 [1st Qtr.] |
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Sales
Turnover |
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|
41.000 |
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Other
Income |
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|
0.000 |
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Total Income |
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|
41.000 |
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Total
Expenditure |
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|
29.200 |
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Operating
Profit |
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|
11.800 |
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Interest |
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|
0.200 |
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Gross
Profit |
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|
11.600 |
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Depreciation |
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|
0.100 |
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Tax |
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|
1.200 |
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Reported
PAT |
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|
7.500 |
Notes
200606 Quarter 1
1. Figures for the previous period have been
rearranged or regrouped wherever necessary conform to the current periods
presentation. 2. Treatment of deferred tax is in accordance with Accounting
Standard -22 'Accounting for taxes on income' issued by ICAI. 3. Investor
grievances received during the quarter ended 30th June 2006 were 6 which were
adequately redressed. There were no investor grievances pending as at the
beginning and end of the quarter. 4. The Company operates only in one segment,
viz. Engineering goods and Services. 5. The Auditors have qualified their
Report for the year ended 31st March 2006, for preparation of Accounts on a
going concern basis due to the erosion in the Company's net worth. However the
management is of the view that since it is aggressively pursuing the markets
for its products and services and is expecting a turnaround in the near future
with the continued financial support from the Promoters, Preparation of
Accounts on a going concern basis is adequately justified. 6. Work-in-progress
is estimated by the management as it is not feasible, in view of the nature of
activity, to compute the same using any of the methods prescribed by AS-2
(Revised) on Valuation of Inventories issued by the Institute of Chartered
Accountants of India. 7. The Auditors have qualified their report for the year
ended 31st March 2006 in respect of certain sundry debtors aggregating Rs.1.193
millions which have remained outstanding for over three years and have not been
confirmed by the parties Provision for the same has been made during the
current period.
KEY
RATIOS
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
Debt-Equity Ratio |
0.00 |
0.00 |
8.46 |
|
Long Term Debt-Equity Ratio |
0.00 |
0.00 |
0.04 |
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Current Ratio |
0.62 |
0.75 |
0.71 |
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TURNOVER RATIOS |
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Fixed Assets |
11.14 |
1.70 |
1.20 |
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Inventory |
49.71 |
0.00 |
0.00 |
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Debtors |
5.97 |
1.28 |
2.24 |
|
Interest Cover Ratio |
0.83 |
[15.60] |
[1.00] |
|
Operating Profit Margin(%) |
1.87 |
[46.84] |
2.13 |
|
Profit Before Interest And Tax Margin(%) |
1.44 |
[49.37] |
[0.61] |
|
Cash Profit Margin(%) |
[0.14] |
[50.00] |
1.52 |
|
Adjusted Net Profit Margin(%) |
[0.57] |
[52.53] |
[1.22] |
|
Return On Capital Employed(%) |
0.00 |
0.00 |
0.00 |
|
Return On Net Worth(%) |
0.00 |
0.00 |
0.00 |
STOCK PRICES
|
Face
Value |
Rs.10.00/- |
|
High |
Rs.18.60/- |
|
Low |
Rs.18.55/- |
LOCAL AGENCY
FURTHER INFORMATION
History
Subject is incorporated as a private limited company
in December 1963, Vulcan Engineers (VEL) became a public limited company in
October 1988. A part of the Vulcan group, VEL was promoted by M S Malaney, who
is also the current chairman.
The company came out with a public issue in March, 1989 to set up a design and engineering centre. The company is into the field of thermal technology, especially industrial furnaces, kilns and thermal process equipment. Its customer base includes BHEL, TISCO, TELCO and Nippon Denro. The company has various collaborations with international organisations like Beckenbach Waermestelle, Germany, for lime kilns, Georg Mendheim, Germany, for tunne kilns, Davy International, USA for reheat furnaces and many others.
The company has diversified into the high growth areas of telecom software sand multimedia industry. In 1995-96 the company executed a number of important projects amongst which was a sophisticated walking beam furnace for billets which the first of its kind in India corresponding to latest technology. Diversification included thermal applications in glass industry, one of them being in design and manufacture of heat treatment equipment and exhaust machines for colour T V tubu industry.
During the year 1996-97 the company won the prestigious Analyst Award 1996 in recognition of excellent track records in rewarding the investors.
REVIEW OF OPERATIONS & FUTURE PROSPECTS :
In the year under review, the Company strengthened its infrastructure and
technical skills, the positive effects of which have started showing. Sales and
other income showed a growth of over 300%. Due to high cost of inputs and
overheads and writing off of bad debts, profitability is still not up to
expectations. However, the Company's operations have almost reached break-even
level. With the expected increase in turnover in 2006-07, the Directors expect
improved results.
The Indian economy has been very buoyant in the last few years and has
registered unprecedented growth. The Indian steel industry is also growing at a
phenomenal pace and has provided a great opportunity to the Indian furnace
industry. Your Company has been taking steps to capitalize on this opportunity
and has plans with an aggressive growth strategy. The Company is also focusing
on global markets, which have opened up in the last few years. Besides, more
and more overseas companies are now outsourcing their manufacturing,
engineering, erection and commissioning services to India. With its proven
track record, your Company sees a good future.
Outlook :
The Company strengthened its infrastructure and technical skills and has
positioned itself to reap the benefits of the buoyant capital goods industry,
particularly the steel industry. The results have already been evident in the
form of increased enquiries and invitations from reputable companies. With its
aggressive marketing strategy backed by a strong technical team, Vulcan
Engineers has a great opportunity to regain tie leadership position it once
occupied as also position itself to tap the huge potential which the expected
increase in outsourcing in the engineering sector to India will provide.
The company has collaboration/joint
venture with:
Ø B W Bowman Inc, USA
Ø Davy International, USA
Ø RCE GmbH, Austria
Fixed
Assets:
Leasehold
Land, Factory Building, Plant & Machinery, Furniture & Fixture, Office
Equipments, Electrical Fittings and Installation, Vehicles, Air-Conditioners,
coolers, refrigerators and Washing Machine, Computers, Tool and Patterns, etc.
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.44.84 |
|
UK
Pound |
1 |
Rs.85.55 |
|
Euro |
1 |
Rs.57.28 |
SCORE &
RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
3 |
|
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 |
YES |
|
--LISTED |
YES/NO |
NO |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
27 |
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 EXPLANATIONS
|
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 |
|
NR |
In view of the lack of information, we
have no basis upon which to recommend credit dealings |
No Rating |
|