MIRA
INFORM REPORT
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Report Date : |
23.08.2007 |
IDENTIFICATION DETAILS
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Name : |
INDIA GLYCOLS LIMITED |
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Registered Office : |
A -1, Industrial Area, |
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Country : |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
19.11.1983 |
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Com. Reg. No.: |
009097 |
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CIN No.: [Company
Identification No.] |
L24111UP1983PLC009097 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
DELI04270A |
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PAN No.: [Permanent
Account No.] |
AAACI7246P |
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Legal Form : |
Public Limited Liability Company Shares are Listed on Stock Exchanges. |
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Line of Business : |
Manufacturing and sale of alcohol based chemicals such as
ethylene glycol, mono-ethylene glycol, ethylene oxide condensates /
derivatives, etc. |
RATING & COMMENTS
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MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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 |
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Maximum Credit Limit : |
USD 12680000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a well-established company of Bhartia Group, a medium sized industrial house. Available information indicates high financial responsibility of the company. Financial position of the company is satisfactory. Payments are usually correct and as per commitments. The company can be considered good for normal business
dealings at usual trade terms and conditions. |
LOCATIONS
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Registered Office / Factory: |
A-1, Industrial Area, |
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Tel. No.: |
91-5947-275313 / 275317-275320 |
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Fax No.: |
91-5947-275315 |
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Email: |
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Website : |
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Head Office : |
C-124, Okhla Industrial Area, Phase I, |
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Tel. No.: |
91-11-26815772 |
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Fax No.: |
91-11-26810390 / 26819410 |
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E-Mail : |
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Corporate Office : |
3A, Shakespeare Sarani, Kolkata - 700 071, |
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DIRECTORS
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Name : |
Mr. M. L. Bhartia |
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Designation : |
Chairman and Managing Director |
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Name : |
Mr. U. S. Bhartia |
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Designation : |
Managing Director |
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Name : |
Mrs. Jayshree Bhartia |
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Designation : |
Director |
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Name : |
Mr. Jagmohan N. Kejriwal |
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Designation : |
Director |
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Name : |
Mr. Autar Krishna |
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Designation : |
Director |
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Name : |
Mr. Pradip K. Khaitan |
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Designation : |
Director |
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Name : |
Mr. N. N. Mahajan |
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Designation : |
Director - SBI Nominee |
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Name : |
Mr. R. C. Misra |
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Designation : |
Director |
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Name : |
Mr. K. N. Memani |
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Designation : |
Additional Director |
KEY EXECUTIVES
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Name : |
Mr. Lalit Kumar Sharma |
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Designation : |
Company Secretary |
BUSINESS DETAILS
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Line of Business : |
Manufacturing and sale of alcohol based chemicals such as
ethylene glycol, mono-ethylene glycol, ethylene oxide condensates /
derivatives, etc. |
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Products : |
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PRODUCTION STATUS
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Particulars |
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Unit |
Installed
Capacity |
Actual
Production |
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Ethylene glycol |
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MT |
35000 |
44148 |
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Ethylene oxide |
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MT |
18000 |
-- |
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Di-ethylene glycol |
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MT |
2500 |
3997 |
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Heavy glycol |
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MT |
160 |
193 |
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E. O. Derivatives |
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MT |
26000 |
30647 |
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Guar Gum Powder and Derivatives |
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MT |
12000 |
1430 |
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Ethyl Alcohol (Potable) Qty. in (KBL) |
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18000 |
1608 |
GENERAL INFORMATION
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No. of Employees : |
Around 540 |
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Bankers : |
·
State Bank of ·
Union Bank of · Punjab National Bank, Kashipur, Uttranchal · UTI Bank Limited, Kashipur, Uttranchal · HDFC Bank Limited, Kashipur, Uttranchal · IDBI Bank Limited |
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Facilities : |
(figures are in Rupees Millions)
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Banking
Relations : |
Good |
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Auditors : |
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Name : |
Lodha and Company Chartered Accountants |
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Address : |
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Associates: |
· Kashipur Holdings Limited · Arial Fibrecom Limited · Khaitan & Company · Ajay Commercial Company (Private) Limited · J. B. Commercial Company (Private) Limited |
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Subsidiaries : |
· IGL Finance Limited · CDS International Limited |
CAPITAL STRUCTURE
Authorised Capital :
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No. of Shares |
Type |
Value |
Amount |
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30000000 |
Equity Shares |
Rs.10/- each |
Rs.300.000 millions |
Issued, Subscribed & Paid-up Capital :
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No. of Shares |
Type |
Value |
Amount |
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27880000 |
Equity Shares |
Rs. 10/- each |
Rs. 278.800 millions |
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
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SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
278.800 |
278.800 |
278.800 |
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2] Reserves & Surplus |
2891.200 |
2593.900 |
2149.400 |
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NETWORTH |
3170.000 |
2872.700 |
2428.200 |
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LOAN FUNDS |
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1] Secured Loans |
5192.700 |
4048.700 |
2592.400 |
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2] Unsecured Loans |
316.400 |
943.900 |
1106.900 |
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TOTAL BORROWING |
5509.100 |
4992.600 |
3699.300 |
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DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
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TOTAL |
8679.100 |
7865.300 |
6127.500 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
6471.400 |
5492.600 |
3890.300 |
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Capital work-in-progress |
1278.100 |
697.200 |
721.200 |
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INVESTMENT |
26.400 |
24.100 |
77.700 |
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CURRENT ASSETS, LOANS & ADVANCES |
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Inventories |
2240.200
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2161.200 |
1976.200 |
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Sundry Debtors |
772.400
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769.200 |
571.700 |
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Cash & Bank Balances |
133.600
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18.500 |
70.000 |
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Loans & Advances |
1076.600
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675.300 |
359.600 |
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Total
Current Assets |
4222.800
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3624.200 |
2977.500 |
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Less : CURRENT
LIABILITIES & PROVISIONS |
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Current Liabilities |
3080.000
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1802.900 |
1429.300 |
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Provisions |
239.600
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169.900 |
109.900 |
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Total
Current Liabilities |
3319.600
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1972.800 |
1539.200 |
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Net Current Assets |
903.200
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1651.400 |
1438.300 |
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MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
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TOTAL |
8679.100 |
7865.300 |
6127.500 |
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PROFIT & LOSS
ACCOUNT
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PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
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Sales Turnover |
10493.700 |
7976.700 |
6355.800 |
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Other Income |
519.400 |
370.200 |
62.800 |
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Total Income |
10822.400 |
8619.700 |
6463.400 |
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Profit/(Loss) Before Tax |
522.500 |
622.300 |
1039.400 |
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Provision for Taxation |
112.000 |
36.500 |
249.700 |
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Profit/(Loss) After Tax |
410.500 |
585.800 |
789.700 |
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Expenditures : |
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Raw Material Consumed |
4526.800 |
3829.000 |
2343.600 |
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Excise Duty |
1619.900 |
908.000 |
768.000 |
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Power and Fuel Cost |
1366.000 |
1220.900 |
663.300 |
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Employee cost |
284.000 |
208.700 |
182.900 |
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Selling and Administration Expenses |
728.600 |
491.900 |
322.700 |
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Interest and Financial Charges |
387.500 |
260.600 |
166.700 |
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Depreciation |
482.700 |
367.200 |
316.500 |
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Other Expenditure |
669.200 |
549.300 |
521.500 |
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Total Expenditure |
10064.700 |
7835.6 |
5285.200 |
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QUARTERLY RESULTS
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Year |
30.06.2007 |
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Type |
1st Quarter |
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Sales Turnover |
2712.100 |
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Other Income |
190.100 |
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Total Income |
2902.200 |
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Total Expenditure |
2158.200 |
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Operating Profit |
744.000 |
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Interest |
119.000 |
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Gross Profit |
625.000 |
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Depreciation |
141.600 |
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Tax |
94.900 |
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Reported PAT |
356.300 |
200706 Quarter 1 --------------- Notes: 1.Other Income includes exchange gain amounting to Rs.147.300 millions on conversion/re-instatement of outstanding foreign currency loans. 2 Information on investors complaints for the quarter-(Nos) :Opening balance-Nil ,New-24,Disposal-24, Closing Balance-Nil. 3 Figures for previous period/ yearhave been regrouped/reclassified, wherever necessary. 4 The above results were reviewed by the Audit committee and have been taken on record by the Board of Directors in its meeting held on 28th July, 2007. 5 The Statutory Auditors have carried out a limited review of the above financial results.
KEY RATIOS
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Year |
31.03.2007 |
31.03.2006 |
30.03.2005 |
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Debt-Equity Ratio |
1.74 |
1.64 |
1.41 |
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Long Term Debt-Equity Ratio |
1.23 |
1.21 |
1.12 |
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Current Ratio |
0.94 |
1.14 |
1.27 |
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TURNOVER RATIOS |
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Fixed Assets |
1.25 |
1.17 |
1.26 |
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Inventory |
4.77 |
3.86 |
4.37 |
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Debtors |
13.61 |
11.90 |
12.25 |
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Interest Cover Ratio |
2.35 |
3.39 |
7.24 |
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Operating Profit Margin(%) |
13.27 |
15.67 |
23.96 |
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Profit Before Interest And Tax Margin(%) |
8.67 |
11.07 |
18.98 |
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Cash Profit Margin(%) |
8.51 |
11.95 |
17.40 |
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Adjusted Net Profit Margin(%) |
3.91 |
7.34 |
12.42 |
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Return On Capital Employed(%) |
11.00 |
12.62 |
24.09 |
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Return On Net Worth(%) |
13.59 |
22.10 |
37.95 |
STOCK PRICES
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Face Value |
Rs.10.00 |
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High |
Rs. 159.00 |
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Low |
Rs. 148.05 |
LOCAL AGENCY FURTHER INFORMATION
HISTORY:
Subject is one of the leading manufactures of Glycols, Ethoxylates and PEGs, Performance Chemicals, Glycol Ether and Acetates, Guar Gum and Potable Alcohol. India Glycols Ltd is the First company in the world to produce Ethylene Oxide (EO) / Mono Ethylene Glycol (MEG) from renewable agro route based on molasses, since 1989. The company is the Leading manufacturers of Glycols, Ethoxylates, Performance Chemicals, Glycol Ethers and Acetates, Guar Gum and Potable Alcohol.
The company has more than 1,000 customers in various such as Textile, Agrochemical, Oil and Gas, Personal Care, Pharmaceuticals, Brake Fluids, Detergent, Emulsion Polymerisation and paints etc.
India Glycols (IGL) was promoted by Vam Organics to manufacture 20,000 tpa of
monoethylene glycol (MEG) at Kashipur, UP. It produces diethylene glycol (DEG)
and triethylene glycol (TEG) as by-products and ethylene oxide (EO) as an
intermediary
The company, controlled by Delhi based Bhartia family was incorporated as UP Glycols, a public limited company and subsequently the name was changed to India Glycols with effect from Sept.'86.
The company has its plant located at Kashipur in Uttranchal. The company has
one Subsidiary namely IGL Finance Ltd. The companies another subsidiary CDL
International ltd is to be amalgamated with the company as per Court orders.
The company had technical tie-up with Scientific
Design Company, US, for the know-how to convert ethanol into MEG. Further it
tied up with Sanyo Chemical Industries Ltd. of
The company diversified into the manufacture of ethylene oxide
condensates/derivatives and its new plant for this at a cost of Rs.400.000
millions has commenced commercial production in Feb.'95. The Company set up an
100% Export Oriented Unit for manufacture of Guar Gum Powder and its
derivatives and it has been registered as a 100% EOU.
The company has also successfully commissioned speciality surfactants
project in collaboration with Sanyo Chemical Industries Ltd in September
1997.
During 2000-2001, CDS International Ltd became a subsidiary of the
company.
During 2001-02 the expansion of EO/MEG was completed and the production
for the expanded capacity has also been commenced.
In February 2005, the company commissioned enhanced capacity of MEG. The
company undertook a scheme to produce RAB (concentrated sugarcane Juice) to
product ethanol to supplement feed stock requirement for expanded capacity of
MEG. The unit will be fully completed and commissioned by December 2005.
The Hon'ble High Court of Uttaranchal vide their order
dated July 15, 2004 and Hon'ble High Court of Karnataka vide their order dated
September 12, 2005 amended on January 30, 2006 have approved the scheme of
amalgamation of M/s. CDS International Limited (100% subsidiary of India
Glycols Limited) with India Glycols Limited.
During 2005-2006, the company commenced production at the newly set up
facility to manufacture RAB on 1st February 1, 2006. Production at the new
industrial gases plant commenced in January, 2006 and capacity of Oxygen,
Nitrogen, Argon are installed with 10400 NM3/Hr, 2828 NM3/Hr, 232 NM3/Hr. A new
distillery plant has been set up with an annual production capacity of 66,000
KBL, at
The company is enhancing the existing capacity of Glycol Ether division
from 17000 MT to 44000 MT. Glycol Ether Acetate capacity is also increased to
18000 MT. The company is diversifying in to the field of herbal farming and for
the purpose herbal farms have been leased from Uttaranchal State Government.
The company is also setting up Herbal Extraction unit under Foreign Technology
Collaboration. The company is also adding up a Chiller Plant and carrying out
modification to use methane blast in place of nitrogen blast. The company is
setting up a Turbo Generator of 12 MW capacity.
DIRECTORS REPORT:
PERFORMANCE:
Sales and other income for the year has been Rs. 10812.223 millions compared to Rs. 819.5090 millions last year. Profit before depreciation and tax for the year has been 1051.146 as compared to Rs. 1017.260 millions last year and net profit after tax for the year has been Rs. 410.531 millions. Company's profitability was adversely affected due to lower realization of MEG and higher cost of molasses and ethanol, on which Company has no control, also on account of higher depredation and interest cost on capitalization of projects commissioned during the year.
During the year, the Company produced 88350 MT of MEG
compared to 89214 MT last year. Ethoxylates/formulated surfactants production
has been 54469 MT compared to 45258 MT last year.
Company has present capacity of Glycol Ethers of 19000 MT, which has been
debottlenected by 30000 MT. Besides, Glycol Ether Acetate capacity has been
debottlenecked to 16800 MT for which there is significant demand and this will
help the Company to further increase export turnover.
Company has changed over to use methane ballast in place of nitrogen ballast in MEG Production for operational efficiency and savings in raw material and power consumption.
A new distillery has been set up with an annual production capacity of 66000 KBL, at Gorakhpur in Eastern U.P. Company has produced 54904 KBL of Alcohol, which has supplemented ethanol required for production of MEG and has reduced the dependence on purchase of alcohol.
The Company has installed Multi Effect Evaporator at
MARKETING:
Sale of MEG has been 96120 MT compared to 82554 MT
last year. The sale of Ethoxylates/formulated surfactants has been 54980 MT
compared to 44547 MT last year.
EXPORTS:
During the year under review, the Company has achieved total export turnover of Rs. 1256.607 millions as compared to Rs. 1238.074 millions last year. The Company expects reasonable growth in the overall export sales in the current year. Company has been granted 'One Star Export House' status by Government of India, Office of the Jt. Director General of Foreign Trade. With its improved performance Company expects further improvement in this status.
GUAR GUM:
During the year, the Company achieved total sales of Rs. 129.1 millions of the Guar Gum products out of which the export turnover was Rs.128.8 millions compared to total sales of Rs.138.4 millions out of which the export turnover was Rs.134.000 millions last year. Efforts are being made to further increase the export sales. The Company has registered the export turn over of Rs.13.000 millions during first two months of the current year and is having firm export orders of 230 MT in hand to be executed by the end of the second quarter.
ETHYL ALCOHOL
(POTABLE) & EXTRA NATURAL ALCOHOL:
During the year, there has been substantial growth in the
Ethyl Alcohol (Potable) segment, the Company registered total sales of Rs.
1530.8 millions compared to Rs. 666.2 millions last year. Efforts are being
made to further increase the sales of Ethyl Alcohol (Potable).
EXPANSION /
MODERNISATION / DIVERSIFICATION PLANS:
The Company is diversifying into the field of Herbal
Extraction through 100% Export Oriented Unit (EOU) at Dehradun, Uttarakhand to
meet the requirement of growing international market for high value
Nutraceutical Herbal Extracts having utility in the pharmaceuticals, food and
food supplements. The State of
Company has set up a Turbo Generator of 12 MW
capacity. This plant will generate power by using high pressure steam before
the same is used at low pressure in the process. This would result in
substantial power saving.
Company is also adding Extra Natural Alcohol (ENA)
facility at
The Industrial Gases division is diversifying to produce Carbon Di-oxide (CO2),
both at Kashipur and Gorakhpur Plants, to meet growing domestic market. The
facilities are expected to be completed by the end of the current financial
year.
FINANCE:
During the year under review. Company has raised foreign currency loans of US $33.25 million to part finance the project cost of setting up of proposed plant for manufacturing Nutraceutical Herbal Extracts and debottlenecking of existing plants and for construction of the Corporate Office.
The borrowing cost of funds has increased to over 7.5% as compared to 6.7% last year and has adversely affected the profitability of the Company
The Company has been regular in meeting its obligations towards payment of
principal/interest to Financial Institutions/ Banks/Debentureholders/Fixed
Deposit holders.
LISTING OF SECURITIES:
The shares of the Company shall continue to be traded
at the Bombay Stock Exchange and the National Stock Exchange.
CMT REPORT (Corruption, Money Laundering
& Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON DESIGNATED
PARTY
No 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. 40.86 |
|
|
1 |
Rs.81.62 |
|
Euro |
1 |
Rs.55.38 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
8 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
6 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
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--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
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--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
NO |
|
TOTAL |
|
65 |
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. |
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 |
|