MIRA
INFORM REPORT
|
Report Date : |
09.04.2007 |
IDENTIFICATION
DETAILS
|
Name : |
HOTLINE GLASS LIMITED |
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Registered Office : |
CBG 07 to 51, Ghirongi Industrial Area, Malanpur, District Bhind, Madhya Pradesh |
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Country : |
India |
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Financials (as on) : |
31.12.2006 |
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Date of Incorporation : |
15.06.1992 |
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Com. Reg. No.: |
10-49176 |
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CIN No.: [Company
Identification No.] |
L32101MP1997PLC011567 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
DELH03998B |
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PAN No.: [Permanent
Account No.] |
AAACH0561L |
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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 : |
Manufacturer of Glass Parts for Television Picture Tubes. |
RATING &
COMMENTS
|
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 but Correct |
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Litigation : |
Clear |
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Comments : |
Subject is an established company having satisfactory track. Profit margin is under severe pressure. Payments are reported as slow but correct. The company can be considered for normal business dealings at usual trade terms and conditions with slight caution. |
LOCATIONS
|
Registered Office / Factory : |
CBG 07 to 51, Ghirongi Industrial Area, Malanpur, District Bhind, Madhya Pradesh, India |
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Tel. No.: |
91-75394-26842986/87/89 |
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Fax No.: |
91-11-26845331 |
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E-Mail : |
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Area : |
116971 sq. meters |
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Head Office / Corporate office : |
52A, Okhla Industrial Estate, Phase III, New Delhi – 110 020, India |
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Tel. No.: |
91-11-51612311-18 |
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Fax No.: |
91-11-26916386/26846364 |
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Administration Office : |
C-31 Govindpuri, University Road, Gwalior - 474 011, Madhya Pradesh, India |
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Tel. No.: |
91-751-2343 161 / 2341 816 / 2340 230 |
DIRECTORS
|
Name : |
Mr. Anil K. Gupta |
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Designation : |
Chairman and
Managing Director |
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Qualification : |
Commerce Graduate |
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Date of Appointment : |
1st
January, 1994 |
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Previous Employment : |
Industrialist |
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Name : |
Mr. G. L. Modi |
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Designation : |
Director |
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Name : |
Mr. Sanjiv Narayan |
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Designation : |
Director |
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Name : |
Mr. Ram K. Gupta |
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Designation : |
IDBI-Nominee |
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Name : |
Mr. V. N. Masaldan |
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Designation : |
Director |
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Name : |
Mr. D. C. Mathur |
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Designation : |
Director |
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Name : |
Mr. Anuj Gupta |
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Designation : |
Director Additional |
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Name : |
Mr. M. P. Rajan |
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Designation : |
Director Additional |
SHAREHOLDING
PATTERN
As on 31.03.2006
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
|
Promoters Holding |
|
|
|
Promoters - Indian Promoters |
44843531 |
56.054 % |
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- Foreign Promoters |
-- |
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.Persons acting in concert |
154030 |
0.193 % |
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Non Promoters Holding |
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Institutional Investors |
-- |
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Mutual Fund and UTI |
22400 |
0.028 % |
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Banks, Financial Institutions, Insurance Companies (Central/State
Govt. Institutions/Non Govt. Institutions) |
28700 |
0.036 % |
|
FII's |
-- |
|
|
Others |
|
|
|
Private Corporate Bodies |
7040692 |
83.801 % |
|
Indian Public |
26611990 |
33.265 % |
|
NRI's / OCB's |
373268 |
0.467 % |
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Any Others (HUF/Firm/Foreign Companies) |
925390 |
1.157 % |
|
Total |
80000000 |
100.00
% |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer of Glass Parts for Television Picture Tubes. |
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Products : |
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PRODUCTION STATUS
|
Particulars |
Unit |
Installed
Capacity |
Actual
Production |
|
Glass Parts for Television Picture Tube |
Nos. |
11000000 |
2340088 |
GENERAL
INFORMATION
|
No. of Employees : |
441 |
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Bankers : |
Punjab National Bank Mid Corporate Branch, Barakhamba Road, New Delhi-110 001 Bankof Baroda Defence Colony, New Delhi -110 024 |
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Facilities : |
--- |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
Statutory Auditors
+
S. S. Kothari & Company Chartered Accountants Plot No. 146-149,
Tribhuvan Complex, Ishwar Nagar, Mathura Road, New Delhi-110065 Internal Auditors
+
Serva Associates Chartered Accountants 8/28 WEA, Abdul Aziz Road, Karol Bagh, New
Delhi - 110005, INDIA |
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Associates/Subsidiaries : |
Ø Hotline Teletubes & Components Limited Ø Fusebase Eltoro Limited Ø Fusebase India Private Limited Ø Leather Trends Private Limited Ø Vaishno Electricals Ø Equity Appliances Ø Mukana Appliances Ø Poly Auto Systems Private Limited Ø L G Hotline CPT Limited |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
80,000,000 |
Equity Shares |
Rs.10/- each |
Rs.800.000 millions |
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|
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Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
80,000,000 |
Equity Shares |
Rs.10/- each |
Rs.800.000 millions |
|
Less : |
Calls in Arrears |
|
Rs. 0.408
millions |
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|
GRAND TOTAL |
|
Rs. 799.592 millions |
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FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.12.2006 [9 Months] |
31.03.2006 [12 Months] |
31.03.2005 [12 Months] |
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SHAREHOLDERS FUNDS |
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|
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1] Share Capital |
799.600 |
799.592 |
799.592 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
0.000 |
186.238 |
203.350 |
|
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4] (Accumulated Losses) |
[895.500] |
0.000 |
0.000 |
|
|
NETWORTH |
[95.900] |
985.830 |
1002.942 |
|
|
LOAN FUNDS |
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|
|
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|
1] Secured Loans |
947.000 |
831.246 |
479.168 |
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2] Unsecured Loans |
476.100 |
475.422 |
493.321 |
|
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TOTAL BORROWING |
1423.100 |
1306.668 |
972.489 |
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DEFERRED TAX LIABILITIES |
0.000 |
124.057 |
129.703 |
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TOTAL |
1327.200 |
2416.555 |
2105.134 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
697.000 |
776.322 |
773.874 |
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Capital work-in-progress |
252.400 |
737.150 |
654.571 |
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INVESTMENT |
135.000 |
270.000 |
270.000 |
|
Project and
Preoperative Expenses
|
0.000 |
77.485 |
14.103 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
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CURRENT ASSETS, LOANS & ADVANCES |
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|
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Inventories |
83.900
|
178.702 |
306.755 |
|
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Sundry Debtors |
285.000
|
445.071 |
215.585 |
|
|
Cash & Bank Balances |
0.400
|
1.295 |
3.460 |
|
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Other Current Assets |
0.000
|
0.872 |
5.398 |
|
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Loans & Advances |
194.200
|
86.209 |
93.507 |
|
Total
Current Assets |
563.500
|
712.149 |
624.705 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
298.700
|
149.327 |
217.926 |
|
|
Provisions |
22.000
|
7.224 |
14.193 |
|
Total
Current Liabilities |
320.700
|
156.551 |
232.119 |
|
|
Net Current Assets |
242.800
|
555.598 |
392.586 |
|
|
|
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|
|
|
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MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
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|
|
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|
|
|
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TOTAL |
1327.200 |
2416.555 |
2105.134 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.12.2006 [9 Months] |
31.03.2006 [12 Months] |
31.03.2005 [12 Months] |
|
|
Sales Turnover |
82.200 |
548.335 |
900.617 |
|
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Other Income |
[71.700] |
[122.876] |
89.371 |
|
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Total Income |
10.500 |
425.459 |
989.988 |
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|
|
|
|
|
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Profit/(Loss) Before Tax |
[1205.600] |
[21.475] |
103.701 |
|
|
Provision for Taxation |
[123.900] |
[5.296] |
35.267 |
|
|
Profit/(Loss) After Tax |
[1081.700] |
[16.179] |
68.434 |
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Imports : |
|
|
|
|
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|
Raw Materials |
NA |
56.872 |
176.406 |
|
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Capital Goods |
NA |
7.528 |
583.571 |
|
Total Imports |
NA |
64.400 |
759.977 |
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Expenditures : |
|
|
|
|
|
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Raw Material
Consumption and Other Manufacturing Expenses |
53.300 |
327.553 |
657.814 |
|
|
Other Expenses |
24.300 |
69.905 |
123.547 |
|
|
Depreciation |
80.800 |
49.476 |
101.807 |
|
|
Miscellaneous
Expenditure Written Off |
931.200 |
0.000 |
3.118 |
|
|
Selling and Administration Expenses |
5.900 |
0.000 |
0.000 |
|
|
Interest |
105.200 |
0.000 |
0.000 |
|
|
Power & Fuel |
15.400 |
0.000 |
0.000 |
|
Total Expenditure |
1216.100 |
446.934 |
886.286 |
|
KEY RATIOS
|
PARTICULARS |
31.12.2006 [9 Months] |
31.03.2006 [12 Months] |
31.03.2005 [12 Months] |
|
Debt Equity Ratio |
3.07 |
1.15 |
0.77 |
|
Long Term Debt
Equity Ratio |
2.62 |
1.00 |
0.67 |
|
Current Ratio |
1.26 |
1.39 |
1.38 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
0.07 |
0.42 |
0.70 |
|
Inventory |
0.83 |
2.66 |
3.84 |
|
Debtors |
0.30 |
1.95 |
3.80 |
|
Interest Cover
Ratio |
[1.67] |
0.26 |
2.56 |
|
Operating Profit
Margin (%) |
[115.45] |
8.85 |
25.95 |
|
Profit Before Interest
and Tax Margin (%) |
[213.75] |
1.18 |
16.23 |
|
Cash Profit
Margin (%) |
[92.70] |
5.16 |
16.25 |
|
Adjusted Net
Profit Margin (%) |
[191.00] |
[2.51] |
6.53 |
|
Return on Capital
Employed (%) |
0.00 |
0.36 |
9.94 |
|
Return on Net
Worth (%) |
0.00 |
[1.63] |
7.06 |
STOCK PRICES
|
Face Value |
Rs.10.00/- |
|
High |
Rs. 2.73/- |
|
Low |
Rs. 2.48/- |
LOCAL AGENCY
FURTHER INFORMATION
Fixed assets
Ø Freehold
Land
Ø Leasehold
Land
Ø Factory
Building
Ø Other
Building
Ø Electric
Installation
Ø Furniture
& Fixture
Ø Vehicles
HISTORY
Incorporated in Jun.'92, Hotline Glass (HGL) was promoted by
A K Gupta and the Hotline group, in technical collaboration with Picvue
Electronics, Taiwan.
The company manufactures glass parts for black and white picture tubes (inst.
cap. 3.3 mln pa; cost : Rs 1200 Millions). The plant is located at Malanpur
(MP). To part-finance the project, HGL entered the capital market with a public
issue in Jan.'94. HGL started commercial production of panels from Dec.'94 and
funnels from Mar.'95 against the scheduled commencement in Sep.'94. HCL has
implemented the project without any cost overruns despite the delay in
commencement. The company started commercial production from third phase in
1996-97.
The plant for manufacturing colour picture tubes in joint venture company,
namely LG Hotline CPT Limited has started commercial production from March'97.
MANAGEMENT
Management discussion and Analysis Report
- Industry Structure and Development - The business of the company is directly
related to the business of TV Industry. The company is producing Glass parts
for Colour Picture Tubes. The business of the company is dependent upon the
working of Hotline CPT Limited to whom it has been supplying Glass Parts.
- Opportunities and Threats - Lower penetration level in domestic market
creates good opportunity for the company as demand for TV is expected to go up
with the rural electrification. The expected increase in demand, especially in
rural area, is an opportunity for the company to manufacture Glass Parts for
Colour TV.
The company is facing threat due to lowering of duties on Colour Picture Tubes
under Free Trade Agreement with Thailand. As per the Free Trade Agreement the
rate of Import duty has gone down to 0% w.e.f. September 2006. This has
seriously affected the working of Hotline CPT Limited, which in turns has
adversely affected the business of our company. Further non availability of
funds to Hotline CPT Limited has hampered the production of Hotline CPT and its
operations have come to a grinding halt. Due to this there is no demand
from Hotline CPT Limited
- Segment wise or Product wise performance - The Company has been engaged
in the production of Glass Parts for Television Picture Tube and in trading of
Picture Tube Parts. The segment wise results are discussed in detail in notes
to accounts.
- Outlook - Though the outlook of TV Industry appears to be
a good in long run, non availability of funds to Hotline CPT Limited and
government policy of allowing Import for Colour Picture Tube at zero duty under
Free Trade Agreement from Thailand has seriously affected the business of the
Company.
Despite best efforts from the Company, funds are not provided by Banks,
Institutions for Panel Project. The company has also tried for financing from
private funds. However till date the financial closure could not be done. In
the absence of funding it is doubtful if the panel project could be started.
Accordingly necessary provision is made in accounts for impairment of plant, as
per accounting standards.
- Risks and Concerns - The biggest risk for the company is stoppage of
production of Hotline CPT Limited, which has been caused by lowering of prices
of Colour Picture Tubes due the Free Trade Agreement with Thailand. It has been
informed that Hotline CPT Limited tried for funds to run its operation. However
even after making detail study, no bank provided need base funds to Hotline CPT
Limited This resulted in stoppage of the production of Hotline CPT Limited As
there is no demand of Hotline CPT Limited, the production of Hotline Glass
Limited is also stopped.
- Internal Control Systems and their adequacy - The Company has internal
control system and procedures commensurate with its size and nature of
business. The internal control systems are supported by internal audit carried
out internally. The adequacy and effectiveness of the internal control, as well
as compliance with the laid down systems and policies are comprehensively
monitored by the internal auditors.
The Internal Audit Reports of the Internal Auditors are discussed at the Audit
Committee Meetings and appropriate corrective steps have been taken.
- Discussions on financial performance with respect to operational performance
- During the year under review, the company have incurred a net loss before tax
of Rs.1205.600 Millions as against net loss before tax of Rs. 21.500 Millions
in the year, 2005-2006. The losses are high due to low volume of production
caused by low demand. Further the company has made provisions for impairment of
Glass Panel Equipments, investment in Hotline CPT Limited and for the amount
recoverable from Hotline CPT Limited as explained in the notes to
accounts.
- Material developments in Human Resources / Industrial Relations front,
including number of people employed - The Company believes in employee's
involvement in achieving the organizational objectives and focused its efforts
to upgrade the skills of its workforce to take up the challenges in present
cutthroat competition.
The company is conscious and committed in providing equal opportunities to the
employees to excel in their work and advance themselves in their career
depending on their abilities.
The company provides in-house training to its employees and maintaining safety
and healthy environment for workers working within the factory premises.
The company employs 346 workers. As a result of sound Human Resources policies
the industrial as well as labour relations have been good and cordial.
|
Contingent liability in respect of : |
Rs In millions |
|
- Corporate
Guarantee of Rs. 0.595 Millions for loans availed by Hotline CPT Limited |
323.138 |
|
- Labour Cases pending with Labour Court |
0.623 |
|
- Custom matters |
164.000 |
|
- Excise Matters |
1.107 |
|
- Sales Tax Matters |
5.462 |
|
- Others |
4.180 |
|
Estimated amount of contracts remaining to be executed on capital
account and not provided for (net of advances) |
149.797 |
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.42.86 |
|
UK Pound |
1 |
Rs.84.40 |
|
Euro |
1 |
Rs.57.53 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
5 |
|
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 |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
32 |
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 |
|