MIRA
INFORM REPORT
|
Report Date : |
31.10.2006 |
IDENTIFICATION
DETAILS
|
Name : |
SUTLEJ
INDUSTRIES LIMITED |
|
|
|
|
Registered Office : |
Pachpahar Road, Bhawanimandi
– 326502, Rajasthan |
|
|
|
|
Country : |
India |
|
|
|
|
Financials (as on) : |
31.03.2006 |
|
|
|
|
Date of Incorporation : |
22.11.1934 |
|
|
|
|
Com. Reg. No.: |
17-2761 |
|
|
|
|
CIN No.: [Company
Identification No.] |
L17301RJ1934PLC002761 |
|
|
|
|
TAN No.: [Tax
Deduction & Collection Account No.] |
JDHS03203E |
|
|
|
|
PAN No.: [Permanent
Account No.] |
AABCS2899H |
|
|
|
|
Legal Form : |
Public
Limited Liability Company. The company’s shares are listed on the Stock Exchanges. |
|
|
|
|
Line of Business : |
Manufacturers
of Cotton Yarn, Yarn of Artificial Staple Fibre, Yarn of Synthetic Staple
Fibre, Woven Fabrics of Synthetic Staple Fibre and Woven Fabrics of
Artificial Staple Fibre. |
RATING & COMMENTS
|
MIRA’s Rating : |
A |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
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 |
|
Maximum Credit Limit : |
USD
4000000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Usually
correct |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject
is a well established company having fine track. Trade relations are fair.
Financial position is satisfactory.
Payments are usually correct and as per commitments. The
company can be considered good for any normal business dealings at usual trade
terms and conditions. |
LOCATIONS
|
Registered Office / Plant : |
Pachpahar Road,
Bhawanimandi – 326502, Rajasthan |
|
Tel. No.: |
91-7433-222052/082/090/115 |
|
Fax No.: |
91-7433-222354 |
|
Gram : |
RAJMILLS |
|
E-Mail : |
info@rtmyarn.com |
|
|
|
|
Plants
: |
Chenab Textile Mills Kathua
184102, Jammu & Kashmir Damanganga Fabrics Village
– Daheli, Near Bhilad, Umbergaon, Distirct Valsad – 396105, Gujarat |
|
|
|
|
Branches
: |
Solaris Building No.1, D-Wing, 6th Floor, Solaris Complex, Saki Vihar Road, Powai, Andheri (East), Mumbai – 400072, Maharashtra, India |
|
Tel.
No.: |
91-22-28573706/07/08 |
|
Fax
No.: |
91-22-2857 3710/11 |
|
E-Mail
: |
DIRECTORS
|
Name : |
Dr. K.K. Birla |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Mr. C. S. Nopany |
|
Designation : |
Vice
Chairman |
|
|
|
|
Name : |
Mr. K. R. Podar |
|
Designation : |
Director
|
|
|
|
|
Name : |
Mr. Arvind C. Dalal |
|
Designation : |
Director
|
|
|
|
|
Name : |
Mr. S. M. Agarwal |
|
Designation : |
Director
|
|
|
|
|
Name
: |
Mr. R. N. Laddha |
|
Designation
: |
Director
|
KEY EXECUTIVES
|
Name
: |
Mr. N.
M. Gupta |
|
Designation
: |
President
|
|
Address
: |
|
|
Date
of Birth/Age : |
77
years |
|
Qualification
: |
B. Com |
|
Experience
: |
51
years |
|
Date
of Appointment : |
18.12.1961 |
|
Last
Employment Held : |
Bowreah
Cotton Mills Limited, Kolkata [Secretary
– 7 years] |
MAJOR SHAREHOLDERS
|
Names
of Shareholders |
No. of Shares |
|
Promoters
|
6648160 |
|
Financial
Institutions, Banks and Mutual Funds |
185418 |
|
Private
Corporate Bodies / Associates |
2071548 |
|
Indian
Public |
1655277 |
|
NRI,
Foreign Nationals, OCBs and FIIs |
35457 |
|
TOTAL |
10595860 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturers
of Cotton Yarn, Yarn of Artificial Staple Fibre, Yarn of Synthetic Staple
Fibre, Woven Fabrics of Synthetic Staple Fibre and Woven Fabrics of
Artificial Staple Fibre. |
||||||||||||
|
|
|
||||||||||||
|
Products : |
|
PRODUCTION
STATUS
|
Particulars |
Installed Capacity |
Actual Production |
|
Spindles |
60112 Nos. |
N.A. |
|
Rotors |
672 Nos. |
N.A. |
|
Cotton Yarns |
N.A. |
2280 Tons |
|
Man Made Fibres Yarn |
N.A. |
8309 Tons |
|
Fabrics |
N.A. |
850 [Thousand Mtrs.] |
|
Waste |
N.A. |
837 Tons |
|
Job Processing |
N.A. |
2039 [Thousand Mtrs.] |
GENERAL
INFORMATION
|
No. of Employees : |
8990 |
|
|
|
|
Bankers : |
Punjab
National Bank |
|
|
|
|
Banking Relations : |
Satisfactory
|
|
|
|
|
Auditors : |
Singhi
& Company Chartered
Accountants, 402,
Pragati House, 47 – 48, Nehru Place, New Delhi – 110019, India |
|
|
|
|
Associates : |
Zuari Industries Limited Texmaco Limited The Hindustan Times Limited Upper Ganges Sugar & Industries Limited The Oudh Sugar Mills Limited Gobind Sugar Mills Limited Sutlej
Textiles and Industries Limited |
|
|
|
|
Subsidiaries : |
Sutlej
Textiles and Industries Limited (STIL) (w.e.f. 22.06.2005) SCM
Investment & Trading Company Limited RTM
Investment & Trading Company Limited SIL
Properties Limited RTM
Properties Limited |
CAPITAL STRUCTURE
Authorised
Capital :
|
No.
of Shares |
Type |
Value |
Amount |
|
12000000 |
Ordinary
Shares |
Rs. 10/- each |
Rs. 120.000 millions |
Issued,
Subscribed & Paid-up Capital :
|
No.
of Shares |
Type |
Value |
Amount |
|
10595860 |
Ordinary
Shares |
Rs. 10/- each |
Rs. 105.959 millions |
|
Add : |
Forfeited
Shares [No. of Shares 35390] |
|
Rs. 0.106 million |
|
|
TOTAL |
|
Rs. 106.065
millions |
FINANCIAL DATA
[all figures are in Rupees
Millions]
ABRIDGED
BALANCE SHEET
|
SOURCES OF FUNDS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
106.065 |
106.065 |
106.100 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
903.242 |
1766.364 |
1665.000 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
1009.307 |
1872.429 |
1771.100 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
0.000 |
3185.604 |
1852.200 |
|
|
2] Unsecured Loans |
0.000 |
274.403 |
334.000 |
|
|
TOTAL BORROWING |
0.000 |
3460.007 |
2186.200 |
|
|
DEFERRED TAX LIABILITIES |
2.421 |
233.052 |
0.000 |
|
|
Deferred Government Subsidies |
0.000 |
9.744 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
1011.728 |
5575.232 |
3957.300 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
21.457 |
2772.481 |
1841.700 |
|
|
Capital work-in-progress |
0.000 |
36.413 |
86.100 |
|
|
|
|
|
|
|
|
INVESTMENT |
1004.732 |
888.548 |
858.000 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
0.000 |
1331.318 |
894.200 |
|
|
Sundry Debtors |
0.000 |
369.769 |
324.600 |
|
|
Cash & Bank Balances |
2.943 |
37.670 |
30.900 |
|
|
Other Current Assets |
0.000 |
105.310 |
0.000 |
|
|
Loans & Advances |
0.103 |
431.495 |
453.800 |
|
Total Current Assets |
3.046 |
2275.562 |
1703.500 |
|
|
Less : CURRENT LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
3.159 |
337.067 |
458.900 |
|
|
Provisions |
14.348 |
60.705 |
73.100 |
|
Total Current Liabilities |
17.507 |
397.772 |
532.000 |
|
|
Net Current Assets |
[14.461] |
1877.790 |
1171.500 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
1011.728 |
5575.232 |
3957.300 |
|
PROFIT
& LOSS ACCOUNT
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
Sales Turnover [including other
income] |
1409.774 |
5251.358 |
4974.900 |
|
|
|
|
|
|
Profit/(Loss)
Before Tax |
209.586 |
209.370 |
150.200 |
|
Provision
for Taxation |
22.475 |
49.424 |
33.800 |
|
Profit/(Loss)
After Tax |
187.111 |
159.946 |
116.400 |
|
|
|
|
|
|
Export
Value |
269.435 |
1436.678 |
N.A. |
|
|
|
|
|
|
Import
Value |
34.360 |
264.100 |
N.A. |
|
|
|
|
|
|
Total
Expenditure |
1235.959 |
4758.540 |
4824.700 |
QUARTERLY
RESULTS
|
PARTICULARS |
|
30.06.2006 [1st Qtr.] |
30.09.2006 [2nd Qtr.] |
|
Sales Turnover |
|
28.200 |
24.100 |
|
Other Income |
|
0.700 |
0.500 |
|
Total Income |
|
28.900 |
24.600 |
|
Total Expenditure |
|
0.700 |
0.700 |
|
Operating Profit |
|
28.200 |
23.900 |
|
Interest |
|
0.000 |
3.600 |
|
Gross Profit |
|
28.200 |
20.300 |
|
Depreciation |
|
0.100 |
0.100 |
|
Tax |
|
3.200 |
0.000 |
|
Reported PAT |
|
24.900 |
20.200 |
Notes
2006-06 Quarter 1
Expenditure indicates Other Expenditure Tax Indicates
Provision for Current Tax EPS is Basic & Diluted Status of Investor
Complaints for the quarter ended June 30, 2006 Complaints Pending at the
beginning of the quarter Nil Complaints Received during the quarter 02
Complaints disposed off during the quarter 02 Complaints unresolved at the end
of the quarter Nil 1. Scheme of Arrangement a) The Hon'ble High Court of
Rajasthan, Bench at Jaipur has sanctioned the Scheme of Arrangement between
Sutlej Textiles and Industries Ltd (STIL) and the Company on May 12, 2006. The
Scheme has become effective on May 29, 2006 on filing of the certified copy of
the Court Order with the Registrar of Companies, Rajasthan, Jaipur. b) Pursuant
to the Scheme, the textiles division of the Company has been vested with the
STIL with effect from the appointed date July 01, 2005. c) In terms of the
scheme, the STIL has issued one equity share of Rs 10/- each fully paid up for
every equity share of Rs 10/- each held by the equity shareholders of the
Company. 2. As a result of Demerger of Textiles Division, the main business of
the Company is in the nature of investment activity. Hence profit on sale of
50000 Shares of Rs 10 each of Century Textiles & Industries Limited Rs
27.10 million; and on sale of 3316309.611 units of HDFC Cash Management Fund
Call Plan - Growth Rs 0.40 million; 3987081.855 units of Prudential ICICI Sweep
Cash Option- Cumulative Rs 0.40 million; & Dividend Income of Rs 0.30
million (accounted for on receipt basis) have been shown under head 'Income
from Operations. 3. Post Demerger the Company has now only one segment of
investment activity, hence the disclosure as to segment wise revenue, results
and capital employed is not applicable. All the operation of the Company are in
India. 4. Figures have been re-grouped / re-arranged and/or recast wherever
found necessary and not comparable with corresponding quarter of the previous
year due to Demerger of textiles division w.e.f. July 01, 2005. 5.The above
financial results were taken on record in the Board Meeting held on July 24,
2006.
2006-09 Quarter 2
EPS is Basic & Diluted Status of Investor
Complaints for the quarter ended September 30, 2006 Complaints Pending at the
beginning of the quarter Nil Complaints Received during the quarter 02
Complaints disposed off during the quarter 02 Complaints unresolved at the end
of the quarter Nil 1. As a result of demerger of Textiles Division, the main
business of the Company is in the nature of investment activity. Hence income relating
to Investment activities has been shown under head 'Income from Operation'. 2.
Post demerger the Company has now only one segment of investment activity,
hence the disclosure as to segment wise revenue, results and capital employed
is not applicable. All the operation of the company are in India. 3. Figures
for the quarter and half year ended September 30, 2005 recasted due to demerger
of textile division of the Company with effect from July 01, 2005 Further
figures for the half year ended September 30, 2005 is not comparable due to
effect of demerger. 4. The above financial results were taken on record in the
Board Meeting held on October 25, 2006.
KEY
RATIOS
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
Debt
Equity Ratio |
1.20 |
1.56 |
1.20 |
|
Long
Term Debt Equity Ratio |
0.78 |
0.99 |
0.73 |
|
Current
Ratio |
1.23 |
1.24 |
1.25 |
|
TURNOVER
RATIOS |
|
|
|
|
Fixed
Assets |
0.57 |
1.27 |
1.39 |
|
Inventory
|
2.07 |
4.80 |
5.25 |
|
Debtors |
7.44 |
15.37 |
14.59 |
|
Interest
Cover Ratio |
2.98 |
2.25 |
2.70 |
|
Operating
Profit Margin (%) |
15.89 |
12.36 |
10.02 |
|
Profit
Before Interest and Tax Margin (%) |
9.65 |
7.05 |
4.95 |
|
Cash
Profit Margin (%) |
11.93 |
8.31 |
7.48 |
|
Adjusted
Net Profit Margin (%) |
5.69 |
3.00 |
2.41 |
|
Return
on Capital Employed (%) |
4.19 |
8.12 |
6.27 |
|
Return
on Net Worth (%) |
5.43 |
8.82 |
6.72 |
STOCK PRICES
|
Face
Value |
Rs.10/-
each |
|
High |
Rs.100.75/- |
|
Low |
Rs.99.00/- |
LOCAL AGENCY
FURTHER INFORMATION
History
:
Subject was
incorporated in 1933, Sutlej Industries Limited, formerly known as Sutlej
Cotton Mills (SCML), engaged in spinning, processing and pressing of cotton.
The company's unit, Rajasthan Textile Mills, was awarded the certificate of
merit by the President of India for achieving a meritorious performance in the
field of exports in 1991-92. It was also recognized by the Synthetic and Rayon
Textile Export Promotion Council for achieving the highest exports in polyester
/ cotton blended yarn category for 1991-92.
In 1995-96, it undertook an expansion of 6048 spindles at its Kathua unit. The
company is exploring the possibility of setting up a denim fabric project as a
part of the diversification programme. The company issued 0.200 million 18% Non
Convertible Debentures of Rs 100 each to Army Group Insurance Fund by way of
private placement. The company was granted ISO 9002:1994 certification in
respect of unit Nos. 4 & 5 of its unit Chenab Textile Mills, Kathua.
In 1999-2000, the
company completed its expansion of Chenab Textile Mills, Kathua by addition of
7680 spindles. It started commercial production from 1st February,
2000. The Company successfully completed modernisation-cum-upgradation scheme
for both the units under the Technology Upgradation Fund Scheme. The Company
has made satisfactory progress by setting up a Fabric project commercial
operations was started on September 2000. The company is planning for a
modernization programme in 2003-04 with an capital outlay of Rs. 320 millions.
In 2002-03 it has spent Rs. 355 millions for modernizing its Bhawanimandi,
Kathua & Bhilad plants.
The directors are pleased to inform you that Scheme of Arrangement
for demerger of Textiles Division of the company with Sutlej Textiles and
Industries Limited (STIL) was approved by the Hon'ble High Court of Rajasthan
Bench at Jaipur on May 12, 2006. The Scheme of demerger became effective from
29th May, 2006. Accordingly, all the assets and liabilities of the
Textiles Division comprising of Rajasthan Textile Mills (RTM), Chenab Textile
Mills (CTM) and Damanganga Fabrics (DGF) stand transferred and vested as a
going concern to STIL from the appointed date July 1, 2005. Hence, the
financial results of the company for the year includes manufacturing operations
only for three months from 01.4.2005 to 30.06.2005 and as such is not
comparable with the results of the previous year.
FUTURE STRATEGY:
After the demerger of the Textiles Division with STIL, the Company is not left
with any manufacturing activity. The company will now concentrate on its
business as an investment company and is taking the necessary steps to register
as a Non-Banking Finance Company with Reserve Bank of India.
OPERATIONS:
During the year under report, the production and sales during the relevant
quarter increased significantly. Profitability also improved despite increase
in cost of raw materials, manufacturing costs and power. Despite these adverse
factors, the company has been able to perform better and has recorded increase
in profits mainly due to higher margins by employing a judicious product mix,
effective cost control and improved productivity. The manufacturing operations
of SIL was only during the first quarter ended 30th June, 2005 as
the Textiles Division had been demerged into STIL.
SIL achieved export performance of Rs. 269.400 millions at FOB value during the
period under report despite sluggishness and stiff competition in the
international market. This was achieved by a sustained export drive in foreign
markets and on the strength of the quality of SIL’s products.
Fixed Assets
Land, Buildings, Plant & Machinery, Vehicles and Furniture & Office Equipments
WEBSITE
DETAILS
With a dedication to customer services Sutlej Industries Limited. (SIL)
was incorporated in 1934 as a Textile Company to meet increasing demand in the
domestic as well as international market.
SIL started with its flagship unit RAJASTHAN TEXTILE MILLS. It strengthened its spinning capacity by
merging CHENAB TEXTILE MILS in 1997.
These two units are producing synthetic and blended yarns with count
ranging from 8’s to 40’s. The
manufacturing plants are equipped with latest machinery from Rieter,
Schlafhorst and Volkman.
As a part of forward integration SIL had also set up a state-of-the-art
weaving and processing plant manufacturing quality fabrics called DAMANGANGA
FABRICS in DAHELI near Bhilad (Gujarat) in the year 2000.
Subsequently pursuant to the scheme of arrangement, the demerger of
textiles division of the Company with Sutlej Textiles and Industries Limited
(STIL) was approved by the Hon’ble High Court of Rajasthan Bench at Jaipur on
May 12, 2006. The scheme of demerger became effective from 29th May,
2006. Accordingly all the assets and
liabilities of the textiles division comprising of Rajasthan Textile Mills
(RTM), Chenab Textile Mills (CTM) and Damanganga Fabrics (DGF) stand
transferred and vested as a going concern to STIL from the appointed date July 1,
2005.
As the textiles division has been demerged into STIL, SIL is not left
with any manufacturing activity. SIL
will continue to operate its business as an investment company and future
prospectus will depend from financial and capital markets. The company’s over all policy is to enhance
its value for all its stake holders as SIL has investments in financially sound
bodies corporate. It expects to earn
dividend and rent income continuously.
The Board of Directors of SIL are comprised of professional and eminent
businessmen of India and is headed by Mr. C. S. Nopany, who is a renowned
industrialist with diverse interest in the fields like sugar, tea, shipping ,
textiles, fertilizers and chemicals, 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.44.83 |
|
UK
Pound |
1 |
Rs.85.36 |
|
Euro |
1 |
Rs.57.21 |
SCORE &
RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--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 |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
63 |
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 |
|