MIRA
INFORM REPORT
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Report Date : |
24.08.2007 |
IDENTIFICATION DETAILS
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Name : |
CHAMBAL FERTILIZERS AND CHEMICALS LIMITED |
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Registered Office : |
Gadepan, District |
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Country : |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
07.05.1985 |
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Com. Reg. No.: |
17-3293 |
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CIN No.: [Company
Identification No.] |
L24124RJ1985PLC003293 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
JDHC01428A |
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PAN No.: [Permanent
Account No.] |
AAACC9762A |
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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 : |
Manufacturers of Ammonia and Urea. |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Maximum Credit Limit : |
USD 4088460 |
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Status : |
Satisfactory |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a well established and reputed company
belonging to Birla Group, one of the large industrial houses in The company’s trade relations are reported as fair.
Payments are usually correct and as per commitments. Financial position is
comfortable. The company can be considered normal for business dealings. |
LOCATIONS
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Registered Office : |
Gadepan, District |
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Tel. No.: |
91-744-6462162/6462167 |
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Fax No.: |
91-744-6465218 |
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E-Mail : |
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Website : |
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Administrative Office : |
6th Floor, |
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Tel. No.: |
91-11-26461162 – 63 |
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Fax No.: |
91-11-26465218/26480639 |
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E-Mail : |
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Corporate Office: |
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Plant : |
Fertiliser
Plant
Gadepan, District Tel. No.91-744-646 2162 / 646 2167 Fax No. 91-744-646 5218 Birla
Textile Mills
Baddi, District Solan - 173205, Himachal Pradesh, India
Software Group
113/114, Food
Processing Unit (on lease)
Village and P. O. Rathdhana, Jatheri – |
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Investor Service Centre: |
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Tel No.: |
011 – 26480427 / 26413361 / 26480392 |
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Fax No.: |
011-26465218 / 26480639 |
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Email : |
jainrajesh@cfert.com / singhrajveer@cfert.com / rathorems@cfert.com |
DIRECTORS
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Name : |
Mr. H. C. Grover |
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Designation : |
Managing Director |
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Name : |
Mr. Sunil Sethy |
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Designation : |
Joint Managing Director |
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Date of Birth/Age : |
54 Years |
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Qualification : |
B. Com, A. C. A. |
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Experience : |
31 Years |
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Date of Appointment : |
15th January, 1996 |
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Name : |
Mr. Mohd. Y. A. Al-Roomi |
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Designation : |
Alternate Director to P. J. Batavia |
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Name : |
Mr. R. N. Bansal |
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Designation : |
Director |
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Name : |
Mr. Dipankar Basu |
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Designation : |
Director |
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Name : |
Mr. Shyam S. Bhartia |
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Designation : |
Director |
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Name : |
Mr. M. D. Locke |
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Designation : |
Alternate Director to C. S. Nopany |
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Name : |
Mr. S. K. Poddar |
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Designation : |
Director |
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Name : |
Mr. A. J. A. Tauro |
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Designation : |
Director |
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Name : |
Mr. Macro Wadia |
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Designation : |
Director |
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Name: |
Dr. K K Birla |
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Designation: |
Director |
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Name: |
Mr. H. S. Bawa |
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Designation: |
Director |
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Name: |
Mr. Anil Kapoor |
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Designation: |
Managing Director |
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OTHER
PERSONNEL :-
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Dr. D. L. Birla |
Executive President (BTM) |
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Mr. Ajit Chakravarti |
Vice President (Corporate HR) |
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Mr. Nirmal Jain |
President – ISG |
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Mr. Anil Kapoor |
Vice President (Strategic Planning) |
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Mr. V. Krishnan |
Vice President - Corporate Finance |
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Mr. R. D. Mall |
Vice President (Operations) |
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Mr. S. M. Nadgir |
Vice President (Agri Business) |
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Mr. S. K. Patra |
Vice President (Marketing) |
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Mr. M. S. Rathore |
General Manager - Legal and Company Secretary |
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Mr. Deepak Kapur |
Vice President – Food Processing |
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Mr. Ashok Kak |
Executive President – BTM |
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Mr. Vinod Mehra |
Vice President |
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Mr. M. George Peter |
Vice President |
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Mr. Krishna Srinivasna |
Chief Executive Officer – IT Business |
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Mr. Abhay Baijal |
Vice President - Finance |
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Mr. Alok Dayal |
Vice President - Corporate HR |
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Mr. Vinod Mehra |
Vice President - Operations |
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Mr. Arun Sharma |
Executive President – |
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Mr. Ashish Srivastava |
Head – Food processing |
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Dr. K K Birla |
Chairman |
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Mr. S. K. Poddar |
Co – Chairman |
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Mr. H S Bawa |
Vice Chairman |
KEY EXECUTIVES
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Name : |
Mr. J S Gogia |
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Designation : |
GM Marketing |
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Name : |
Mr. H K Narang |
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Designation : |
General Manager |
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Name : |
M/s. A Nirula |
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Designation : |
General Manager |
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Address : |
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MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
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Category |
No. of Shares |
Percentage of
Holding |
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Promoters |
201388474 |
48.39 |
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Financial Instituitions, Bank, and Mutual Funds |
50694432 |
12.18 |
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NRIs, Foreign Nationals, OCBs,
and Flls |
36429828 |
8.75 |
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127695118 |
30.68 |
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Total |
416207852 |
100.00 |
BUSINESS DETAILS
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Line of Business : |
Manufacturers of Ammonia and Urea. |
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Products : |
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PRODUCTION STATUS
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Particulars |
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Unit |
Licensed
Capacity [
2006 - 07] |
Installed
Capacity [
2006 - 07] |
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i) Fertiliser |
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MTPD |
--- |
--- |
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Ammonia |
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MTPD |
2700 |
2700 |
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Urea |
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MTPD |
4600 |
4600 |
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ii) Yarn Spindles |
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Nos. |
-- |
80208* |
* 39888 spindles commissioned during the year.
Actual Production:
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Production |
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Quantity
( Tons) |
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Ammonia |
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1098544.000 |
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Urea |
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1925648.000 |
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Synthetic Yarn |
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Man Made Fibre Yarn |
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11720.483 |
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Fibre Yarn Waste |
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518.981 |
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Cotton Yarn |
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-- |
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Yarn |
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2166.436 |
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Fibre Waste |
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827.663 |
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Frozen vegetables and Fruits |
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7645.764 |
GENERAL INFORMATION
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Suppliers : |
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No. of Employees : |
843 |
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Bankers : |
²
Bank of ² Punjab National Bank ²
State Bank of ² Allahabad Bank ²
State Bank of ²
State Bank of ²
State Bank of ²
State Bank of ² Citibank ² HDFC Bank ² ICICI Bank ² ING Vysya Bank ²
State Bank of ² UTI Bank Debenture Trustee: UTI Bank Limited |
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Facilities : |
Secured loan:
1.7% Secured redeemable non-convertible debentures are secured
by first pari-passu charge by way of mortgage in English form in respect of
the immovable properties of the company situated in 2. 7.90% Secured redeemable non-convertible debentures are secured by first pari passu charge by way of mortgage by deposit of title deeds in respect of immovable properties and hypothecation of the movable assets of the company, both present and future (save and except book debts and assets of shipping division) subject to prior charges created / to be created in favour of bankers on movables for securing working capital borrowings. These debentures are redeemable on March 31, 2011. 3. Rupee term loan from financial institutions, banks and others (except for loans of Rs. 8.000 millions and Rs. 280.039 millions from banks and Rs. 10000.000 millions from financial institutions) and foreign currency loans of Rs. 2947.092 millions from banks are secured / to be secured by first pari-passu charge by way of mortgage, by deposit of title deeds in respect of immovable properties and hypothecation of the movable assets of the company, both present and future (save and except book debts and assets of shipping division), subject to prior charges created / to be created in favour of bankers, financial institutions and others on movables for securing working capital borrowings. 4. Rupee term loan of Rs. 8.000 millions from a bank is secured by hypothecation of Wartsila DG Set of 4 MW under exclusive charge. 5. Rupee term loan of Rs. 280.039 millions from a bank is secured by mortgage on the company's vessels, M.T. Ratna Urvi and hypothecation of movable assets and receivables (both present and future) of shipping division of the company. 6. Rupee term loan of Rs. 10000.000 millions from a financial Institutions is to be secured by first pari passu' charge on the movable fixed assets of the company (save and except assets of shipping division of the company). 7. Foreign currency loans of Rs. 2429.280 millions from banks is secured by mortgage on the company's vessels M.T.Ratna Puja and M.T. Ratna Shalini and assignment of earnings, insurance and requisition compensation in respect of these vessels. 8. Foreign currency term loan of Rs. 525.930 millions from foreign banks/ financial institutions is currently secured by assignment of ship building contract and refund guarantees in respect of three new vessels under construction. 9. Cash credit loans from banks are secured by hypothecation of all the company's movable assets including movable machinery, all stocks and book debts (including subsidy support), both present & future (except assets of shipping division). These loans are further secured / to be secured by second charge on all the immovable properties (except assets of shipping division) of the company. 10. Finance lease liability is secured by assets acquired under the facility. 11. Secured loans (other than cash credit loans from banks and short term rupee loans) includes Rs. 1149.991 millions (Previous Year Rs.1140.740 millions) repayable within one year.
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
S. R. Batliboi and Company Chartered Accountants Singhi and company Chartered Accountants |
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Membership: |
Confederation of Indian Industry |
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Associates/Subsidiaries : |
Subsidiaries
and Step-down Subsidiaries of CFCL Overseas Limited
Subsidiaries
and Step-down Subsidiaries of CFCL Overseas Limited
Subsidiaries
and Step-down Subsidiaries of CFCL Ventures Limited
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CAPITAL STRUCTURE
Authorised Capital :
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No. of Shares |
Type |
Value |
Amount |
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440000000 |
Equity Shares |
Rs. 10/- each |
Rs. 4400.000 millions |
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210000000 |
Redeemable Preference Shares |
Rs.10/- each |
Rs. 2100.000 millions |
Issued, Subscribed & Paid-up Capital :
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No. of Shares |
Type |
Value |
Amount |
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416207852 |
Equity shares |
Rs.10/- each |
Rs.4162.079
millons |
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 |
4162.079 |
4162.079 |
4060.000 |
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2] Share Application Money |
0.000 |
0.000 |
104.579 |
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3] Reserves & Surplus |
6059.071 |
5449.556 |
4272.982 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
10221.15 |
9611.635 |
8437.561 |
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LOAN FUNDS |
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1] Secured Loans |
13067.642 |
4787.639 |
6776.820 |
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2] Unsecured Loans |
5898.020 |
3195.418 |
2559.012 |
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TOTAL BORROWING |
18965.662 |
7983.057 |
9335.832 |
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DEFERRED PAYMENT LIABILITIES |
1334.121 |
1829.461 |
3030.791 |
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DEFERRED TAX LIABILITIES ( Net ) |
3163.221 |
3454.569 |
4089.142 |
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TOTAL |
33684.154 |
22878.722 |
24821.707 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
18132.587 |
15443.869 |
17013.527 |
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Capital work-in-progress |
3650.920 |
1586.904 |
27.333 |
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INTANGIBLE ASSETS |
62.991 |
--- |
--- |
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INVESTMENT |
3659.809 |
2595.722 |
3012.624 |
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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 |
3520.131 |
2492.168 |
2208.018
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Sundry Debtors |
5258.419 |
3191.086 |
4033.921
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Cash & Bank Balances |
1108.461 |
782.985 |
172.972
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Other Current Assets |
65.284 |
44.914 |
20.488
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Loans & Advances |
978.373 |
458.460 |
1189.076
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Total
Current Assets |
10930.668
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6969.613 |
7624.475
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Less : CURRENT
LIABILITIES & PROVISIONS |
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Current Liabilities |
1367.797 |
2469.564 |
2060.908
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Provisions |
1404.851 |
1289.801 |
894.457
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Total
Current Liabilities |
2772.648
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3759.365 |
2955.365
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Net Current Assets |
8158.020
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3210.248 |
4669.110
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MISCELLANEOUS EXPENSES |
19.827 |
41.979 |
99.113 |
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TOTAL |
33684.154 |
22878.722 |
24821.707 |
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PROFIT & LOSS
ACCOUNT
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PARTICULARS |
31.03.2007 |
31.03.2006 |
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Sales Turnover |
25913.060 |
27406.203 |
27094.960 |
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Other Income |
223.493 |
165.805 |
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Total Income |
26136.553 |
27572.008 |
27094.960 |
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Profit/(Loss) Before Tax |
2089.576 |
2410.999 |
2162.059 |
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Provision for Taxation |
578.266 |
379.794 |
[44.193] |
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Profit/(Loss) After Tax |
1511.310 |
2031.205 |
2206.252 |
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Earnings in Foreign Currency : |
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FOB Value of Export |
1037.091 |
844.525 |
0.000 |
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Dispatch Money ( on cash basis) |
2.982 |
2.382 |
0.000 |
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Others (on cash basis) |
11.325 |
12.493 |
0.000 |
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Total Earnings |
1051.398 |
859.400 |
0.000 |
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CIF VALUE OF IMPORTS: ( on cash
basis) |
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Capital Goods (including production stores
and spares parts) |
171.610 |
23.376 |
0.000 |
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Expenditures : |
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Increase / Decrease in Stocks |
(793.853) |
263.439 |
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Purchases of Trading Goods |
2601.075 |
5941.456 |
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Manufacturing and other Expenses |
19245.745 |
15982.678 |
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Frieght
to Charter - in- Ship |
237.333 |
632.774 |
24932.901 |
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Financial Expenses |
990.709 |
751.114 |
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Depreciation / Amortization |
1765.968 |
1589.548 |
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Total Expenditure |
24046.977 |
25161.009 |
24932.901 |
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QUARTERLY /
SUMMARISED RESULTS
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Year |
|
30.06.2007 |
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Type |
|
1st
Quarter |
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Sales
Turnover |
|
5951.100 |
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Other
Income |
|
444.100 |
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Total
Income |
|
6395.200 |
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Total
Expenditure |
|
4846.900 |
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Operating
Profit |
|
1548.300 |
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Interest |
|
3
1.300 |
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Gross
Profit |
|
1227.000 |
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Depreciation |
|
457.800 |
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Tax |
|
225.500 |
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Reported
PAT |
|
617.100 |
200706 Quarter 1 --------------- Notes Expenditure Includes (Increase)/Decrease in stock in Trade Rs (305.90) million Consumption of Raw Material Rs 1841.30 million Staff Cost Rs 183.30 million Power and Fuel Rs 1150.70 million Purchase of goods for trading Rs 793.40 million Other Rs 1183.10 million Tax Includes Provision for Fringe Benefit Tax Rs 2.90 million Current Income Tax Rs 222.60 million Deferred Tax Rs (73.40) million Tonnage Tax Rs 1.00 million Status of Investor Complaints for the quarter ended June 30, 2007 Complaints Pending at the beginning of the quarter Nil Complaints Received during the quarter 243 Complaints disposed off during the quarter 238 Complaints unresolved at the end of the quarter 05 1. Subsidy on urea is recognised based on concessional rates, including equated freight, as notified under the New Pricing Scheme (NPS), further adjusted for input price escalation / de-escalation, as estimated on the basis of prescribed norms. Pending notification of concession price under the NPS - Stage III effective from October 01, 2006, the concession price have been accounted for, based on estimated impact of the NPS - Stage III parameters. 2. Gadepan-II fertiliser plant was under planned shutdown for about 7 days during the month of April, 2007. 3. During the quarter, in view of notification issued by the Ministry of Corporate Affairs dated December 07, 2006 prescribing the Companies (Accounting Standards) Rules 2006, the Company has changed the accounting policy related to recognition of foreign exchange fluctuation on fixed assets, related to transactions entered after April 01, 2004. The foreign exchange variation is now being charged/ credited to the profit and loss account, which till previous year was adjusted to the carrying value of respective assets. Pursuant to this change, foreign exchange variation gain for the quarter amounting to Rs 396.20 million has been credited to the profit and loss account and has been classified under other income. Further, as per the requirements of Clause 41 of the Listing Agreement, previous period figures have been recast in line with the present accounting policy to make them comparable. 4. During the quarter, the Company made the following investments in its subsidiaries _ (a) CFCL Overseas Ltd, Cayman Islands _ Rs 49.50 million and (b) India Steamship Pte Ltd., Singapore _ Rs 49.00 million. 5. Previous period figures have been regrouped and or re-arranged wherever necessary to make their classification comparable with the current period. 6. The Auditors have conducted Limited Review of the financial results for the quarter ended June 30, 2007. The results were reviewed by the Audit Committee. The Board of Directors has taken on record the Financial Results at its Meeting held on July 25, 2007.
KEY RATIOS
|
Year |
|
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt-Equity Ratio |
|
1.52 |
1.20 |
1.58 |
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Long Term Debt-Equity Ratio |
|
0.96 |
0.93 |
1.43 |
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Current Ratio |
|
0.74 |
0.80 |
0.95 |
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TURNOVER RATIOS |
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Fixed Assets |
|
0.85 |
0.98 |
0.98 |
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Inventory |
|
8.62 |
10.00 |
10.31 |
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Debtors |
|
6.13 |
6.71 |
5.95 |
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Interest Cover Ratio |
|
3.20 |
4.20 |
3.23 |
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Operating Profit Margin(%) |
|
19.27 |
17.35 |
17.23 |
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Profit Before Interest And Tax Margin(%) |
|
12.22 |
11.57 |
11.61 |
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Cash Profit Margin(%) |
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12.88 |
12.30 |
12.16 |
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Adjusted Net Profit Margin(%) |
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5.83 |
6.52 |
6.54 |
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Return On Capital Employed(%) |
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12.70 |
16.10 |
15.31 |
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Return On Net Worth(%) |
|
15.24 |
19.99 |
22.27 |
LOCAL AGENCY FURTHER INFORMATION
HISTORY
The company was incorporated on 7th May, 1985 at Gadepan in Rajasthan having Company Registration No. 3293.
The company was originally incorporated under the name and style of Aravali Fertilisers and was changed to present in January 1989. The company was promoted by Zuari Agro Chemicals Limited.
The company’s plant is a state-of –the-art hi-tech complex built at a cost of Rs. 12.67 billion, spread over an area of 1105 acres (or 447 hectares 4.47 sq.kmts.), containing the manufacturing units, off-site facilities including captive power plant, railway siding and amenities like residential complex, club, school, etc. Snamprogetti of Italy and haldor Topsoe of Denmark provided the technical know-how and engineering and other services for ammonia and urea plant while off-site facilities were built mainly by Toyo Engineering India Limited.
To help farmers in obtaining optimum crop yields, the
company has set up a state-of-the-art soil-testing laboratory at Sriganganagar,
The company set up a spinning unit namely Birla Textile Mills at Baddi, District Solan, Himachal Pradesh at an outlay of Rs. 1055 millions.
The company was accredited ISO 14001 for Environment
Management Systems by DNV,
The company is planning to hive off its software business unit India Software Group as a separate corporate entity. It is also planning to invest Rs. 500 millions either by way of capital or mix of capital and debt component in the new entity. The stake in Novasoft was increased to 90% through investment of $4 million. Further the company has hived off India Software Group (the software division of the Company) into ISG Novasoft Technologies Ltd w.e.f. April 1,2005 and ISG Novasoft Technologies Limited was incorporated as wholly owned subsidiary of the company during the year 2004-05.
The
company has amalgamated India Steamship Company Limited (ISCL) with itself with
effect from 1st September 2004. According to the Scheme of Amalgamation, it has
issued 11 equity shares of Rs.10/- of the company to the shareholders of ISCL
for every 20 equity shares of Rs.10/- of ISCL held by them. Further the company
has amalgamated the Shipping Investments Undertaking of Zuari Investments
Limited (ZIL) which was demerged by ZIL and this is also became effective from
1st September 2004. According to the Scheme of Amalgamation, for every 10000
equity shares held in ZIL, an equity shareholder of ZIL shall be issued 473 5%
Non-Convertible debenture of face value of Rs.100/- each credited as fully
paid-up by CFCL and shall retain 6393.43 equity shares in ZIL. The remaining
3606.57 equity shares held by the equity shares held by the equity shareholder
in ZIL shall stand extinguished. Indo Maroc Phosphore SA Morocco (IMACID) was a
50:50 joint venture office between Cherifien Des Phosphates (OCP),
The company has planned to increased capacity of th existing facility at Baddi
by 39744 spindles at a cost of Rs.1220 millions for manufacture of Cotton Yarn
and the existing facility manufactures Syntheic blended yarn. The plant is
expected to be commissioned by end March 2007.
The company has increased the installed capacity of Yarn Spindles by 2304 Nos.
during 2004-05 and with this expansion the total installed capacity of Yarn
Spindles has increased to 39552 Nos.
The company has signed a shipbuilding pact with Hyundai Heavy Industries
Company Limited The agreement was signed during march 2006 and as per the
agreement, Chambal would build two Afamax Tankers.
• An integral part of the Rs .45000 millions K K Birla group, the company, which was set up in 1985 has come a long way since.
• It was promoted by Zuari Industries Limited, which already held a dominant position in the Indian fertilizer industry and went public in 1993.
• Today, the company operates two hi-tech gas-based
nitrogenous fertilizer plants (production commenced in phases w.e.f January
1994 & October 1999 respectively), both at Gadepan near
• Over the years, besides organic growth, the company has effectively used joint ventures and acquisitions for diversification and expansion, albeit sometimes into unrelated areas .
• Citing the high growth prospects in the IT Services space, the company forayed into the software services business in 1999 through its division, India Software Group (I S G) headquartered at Chennai.
• Since then, this division has grown at a fairly brisk pace but has remained small in context of the company’s bread and butter business, namely fertilizers.
• Realizing the need for consolidation and focus to survive in the dynamic IT industry, in November 2001, the company acquired a 51% stake in the New Jersey based Nova S of t Information Technology Corporation (an existing 18 - year old company), which it further increased to 90% in Q1 FY04. The total amount invested in Nova S oft is Rs. 180 millions.
• The company also forayed into the retail home finance
business by acquiring the beleaguered I T C Classic Home Finance Limited in
1999. In September 2000, it roped in B H W Holding AG of
• I n 1999, the company also entered into a 50-50 US $ 204
million joint venture project [Indo Maroc Phos phore S A (I MACI D)] , with Office
Cherifien Des Phosphates (OCP) of
• In sync with its bid to be present in all sunrise industries,
the company entered into a 50-50 joint venture with Technico Pty Limited,
High- health status' seed potato in
• In a complex structured transaction, the company had
decided to invest in a phased manner, a sum of Rs. 600 millions into Technico
Pty Limited,
• In another landmark, the group emerged a successful bidder
for the Government owned Paradeep Phosphates Limited (PPL), when it was put on
the block during the first round of disinvestment. This acquisition again was
through Zuari Maroc Phosphates , a JV between the Zuari – the company combine
and the OCP Group of
• In the very first year after privatization, PPL reported a 3-fold increase in topline and a 75% reduction in losses .
BUSINESS:
DIRECTORS REPORT:
New Fertiliser
Pricing Policy
The Government of India had introduced New Pricing Scheme (NPS) for Urea w.e.f.
April 1, 2003. NPS was to be implemented in three stages. Stage I and II of the
NPS were completed on March 31, 2004 and September 30, 2006, respectively.
Stage III of NPS commenced on October 1, 2006 and will continue till March 31,
2010.
Arising out of changes in some of the parameters like
capacity utilization norms, pre-set energy consumption norms, etc.,
implementation of Stage III policy is expected to have a negative impact on
profitability. However, the Company has represented to the Government of India
to make the norms for Gadepan II Plants more equitable.
As per the NPS, the distribution of Urea was to be fully decontrolled
from April 1, 2004. However, the Government decided to continue with 50%
decontrol during the year 2006-07.
The Company has prepared the accounts on the basis of notified concession
prices for Urea under the New Pricing Scheme further adjusted for input price
escalation / de-escalation and expected impact of Stage III policy with effect
from October 1, 2006. The concession in respect of Urea produced in excess of
100% capacity from Gadepan I and II Plants has been accounted for on an
estimated basis in line with the known policy parameters.
Deal of the year
The Company has arranged a foreign currency loan of
US$ 154 million from a consortium consisting of ING Bank, BNP Paribas, KFW and
Societe Generale to finance building of three aframax tankers. The facility is
backed by Korea Export Insurance Corporation. This was the first time that
Korean export credit agency has supported the export of ships into
This deal was awarded as the Deal of the Year - 2006 by Trade Finance Journal
published by Economy Institutional Investor, Plc.
Joint Ventures and
Associates
(i) Indo Maroc Phosphore
S.A.,
During the year 2006, IMACID produced 362,945 MT of Phosphoric Acid (P2O5) at a daily average plant rate of 1237 MTPD. Sales during the period were 361,769 MT of P2O5.
IMACID earned cash profit of MAD 295.8 million (net of tax) during the
year 2006 as against MAD 318.4 million in 2005. The decrease in cash profit for
2006 was mainly on account of higher tax outgo, unfavourable impact of exchange
rate variation and lower production and sales of P2O5. Lower production was
mainly due to longer plant shutdown required to implement the revamp
project.
The Capacity Augmentation Project-II to increase annual capacity of P2O5 from
365,000 MT to 430,000 MT was completed and new capacity went on stream in
September, 2006. The project was commissioned at a capital cost of MAD 214.9
million as against projected cost of MAD 238 million.
(ii) Zuari Investments Limited
(ZIL)
ZIL is a member of National Stock Exchange of India Limited
for equity as well as Futures and Options (FandO) segment and Over the Counter
Exchange of India. ZIL is also a depository participant with National Securities
Depository Limited and Central Depository Services (
During the year, ZIL has become a member of the Bombay
Stock Exchange to complete its bouquet of Broking Services.
ZIL has promoted Zuari Chambal Insurance Solutions Limited (ZCISL) as its
wholly owned subsidiary. This subsidiary has commenced operations as a Direct
Broker for Life and Non-Life segment after receiving the licence from Insurance
Regulatory and Development Authority.
ZIL has now become one stop shop for Stock Broking, Depository Services,
Investment Advisory Services and Insurance Broking Services (through its
subsidiary) and is fully poised to reap the benefits of a buoyant capital
market.
During the financial year 2006-07, the income of ZIL from various services was Rs. 58.094 millions and cash profit was Rs. 15.599 millions.
Subsidiaries
(i)
Chambal Biotech Private Limited
Chambal Biotech is a Special Purpose Vehicle of the Company for making
investment in Seed Potato Business and it holds 77.64% equity stake in Technico
Pty. Limited,
(ii) Technico Pty. Limited,
The Technico business continued on its growth curve
and has penetrated deeper into
Strong brand recognition in the Indian market has helped to establish the
Technico product as the quality leader. The year 2006-07 has seen growth in
sales revenues and profits. This business, like the rest of the Potato seed
industry was challenged by the continuous bad weather in the major seed growing
region of
The
Although Technico is at an early stage in the start-up cycle with its
Overall, the Technico has achieved across the board
gains in the business over 2005-06. On an EBIDTA basis, Technico has delivered
a profit of AUD 1.15 million during the year 2006-07 against a loss of AUD 0.85
million in 2005-06.
For the year ended March 31, 2007, Technico achieved sales revenue of AUD 8.97 million and cash profit of AUD 0.3 million (versus a cash loss of AUD 1.85 million in 2005-06).
(iii) CFCL Overseas Limited,
CFCL Overseas was incorporated during the year as a Special
Purpose Vehicle (wholly owned subsidiary) of the Company for consolidation of
its software business. As on date, the total investment of the Company in CFCL
Overseas stands at Rs. 1850.000 millions.
(iv) NovaSoft Information
Technology Corporation,
During the year under review, NovaSoft was engaged in
Mortgage business vertical with focus on the residential mortgage segment.
NovaSoft growth strategy comprises of acquiring the best software technology
platform vendors, industry-leading consulting services and on-shore BPO
capabilities via inorganic growth. As a part of this strategy, NovaSoft has
acquired residential mortgage division of Fair Isaac, a
The Revenue and Cash Losses of NovaSoft for 12 month period ended March
31, 2007 were US $ 15.01 million and US $ 7.10 million, respectively.
(v) ISG
Novasoft Technologies Limited (ISG Novasoft)
During the year under review, ISG Novasoft has embarked in the third-party India
BPO sector, focusing on the broad area of asset based lending services, with an
initial thrust in residential mortgages. ISG Novasoft is executing a unique and
innovative platform-based BPO strategy in scaling up transactional BPO services
in
The management of Chambal Fertilisers and Chemicals Limited is pleased to present its analysis report covering segment-wise performance and outlook.
The Company has four business segments viz. Fertiliser,
Textile, Shipping and Food Processing of which the Fertiliser Division is by
far the largest. The Urea manufacturing facility of the Company with an annual
capacity of 1.73 million MT is the largest in the private sector. The aforesaid
business activities are supported by an extensive marketing network.
FERTILISER DIVISION
Industry Structure
There has been no capacity addition in
Developments in
Government Policies
New Pricing Scheme (NPS) Stage III has been announced effective October 1, 2006 and will continue until March 31,2010. The entire Urea industry was divided into six groups based on feedstock used and vintage of the plants when NPS was introduced from April 1, 2003. Same classification will continue during State III with updation ofconversion cost and changes in energy and capacity utilization norms.
Pricing of additional production upto 110% of re-assessed capacity will be as per the existing New Pricing Scheme (Phase II). Additional production above 110% shall be eligible for concession price subject to maximum of Import Parity Price. While the contours of the Fertiliser Policy are explicit, the final group-wise prices are yet to be notified.
Natural Gas Scenario
The overall fertilizer demand considering
feedstock conversion, revamp, expansion, etc. is
expected to be around
76.00 MMSCMD in the year 2010-11. With finds in KG Basin on
Opportunities
In view of the commissioning of Vijaipur - Kota gas
pipeline in year 2007 coupled with the supply-demand outlook for urea and
discovery of new gas sources in KG Basin, there is an opportunity for the
Company to grow.Major de-bottlenecking of Gadepan Plants will be considered once
the long term Fertiliser Policy is finalised by Government of India. However,
the Company has initiated Energy Conservation Projects to minimize energy
consumption in
both fertiliser plants at Gadepan.
Operational and Financial Performance
The performance of Fertiliser Division is summarized below:
2006
- 07 2005 - 06
Urea Production
(MT in millions)
1.926 1.902
Sales including Agri inputs (Rs.in millions)
222.872 240.059
EBIDTA (Rs. in millions)
38.997 41.423
The highest ever urea production of 1. 926 millions MT was achieved
during the year.
The Company also
sold the highest ever urea quantity of 1.927 million MT during the year 2006-07
against the last year sale of 1.890
HUMAN RESOURCSE AND
DEVELOPMENT
Training and
Development:
Programmes to cover all employees and nominated around 30%
of the employees to the relevant External Training Programmes conducted by
reputed institutes and Business Schools. The training included various soft
skills and behavioral areas such as Communication & Presentation, Time
Management, Assertiveness,
Management and Sales and Marketing Management. With this focus, the Company was able to achieve around 4 days of training per employee this year.
BIRLA TEXTILE MILLS - SPINNING
DIVISION
Industry Structure
Indian textile and clothing industry witnessed significant
changes during last 2-3 years. The excise and customs duties applicable to the
industry got substantially rationalized and reduced. The economy of the Country
started growing at a much faster pace. The bilateral quotas that regulated
international trade in textile products for over 45 years were abolished in
December 2004. These developments imparted an impetus to the industry. This has
been discernible in the investment trends and export growth during the last
couple of years. Overall Indian market has grown from US $ 36 billion to US $
52 billion at a rate of 10% per annum between financial years 2002-2006. Growth
in domestic consumption has been driven mainly by growth in per capita income
from Rs. 17,883 to Rs.25,788 during 2001-06. Export growth has been driven by
growth in world trade and increase in
Investment in the industry has been to the tune of Rs.430.000 millions during 2003-06. Acceleration in investment was due to increase in size of domestic as well as export market and various policy initiatives including extension of Technology Upgradation Fund Scheme.
Opportunities &
Threats
Indian Textile and Clothing Industry is poised for a significant growth. It is expected to reach a size of US S 110 billion by the year 2012. In order to achieve the projected growth, Industry needs to double the production by Financial Year 2011-12 from current level. This will require investment to the tune of Rs. 1940.0.00 million (US $ 43 billion) including investment of Rs. 550.000 millions in spinning.
However, recent spurt in Rupee value has a dampening effect on exports. Slowdown in consumer spending and investment, are some of the key risk factors. Outdated labour laws are also hindering investment. Government needs to reform labour laws quickly and address infrastructural constraints and transaction costs. Import content of textile capital goods is currently over 70%. In order to capitalize on global opportunity, the Government needs to provide incentives by way of duty free imports of machinery by the Textile Industry and rationalize the excise duty on indigenous textile capital goods manufacture.
Outlook
Growth in domestic market will be driven by strong demographic and consumption trends. Increasing retail penetration, higher disposable income levels and rising urban population augurs well for the growth of industry. Increase in nuclear families is expected to drive strong growth for home textiles. Strong growth in IT/ITES industry, hotel industry and health care delivery market will drive infrastructure demand for furnishing items.
Uncompetitive manufacturing in developed world has resulted in dismantling of spinning and weaving capacities in USA, western Europe, Japan, South Korea, etc. and relocation to cheaper competitive Asian countries like India.
To seize the opportunities presented by the new economic environment in the textile industry, the Company has doubled spindlage with the addition of 39,744 spindles for manufacture of cotton yarn at Baddi, which was completed on schedule. The Company is exploring the possibilities of further expansion.
Material Development
in Human Resources / Industrial Relations front including Number of People
Employed
Being a labour intensive industry, training and development of human resources is of paramount importance. Well
structured in-house training programmes conducted by experienced and competent faculty have improved the skill levels and the employee commitment. The training efforts at the shop floor level have yielded excellent results. Presently, the manpower deployment comprises of 1672 workers, 241 staff members and 539 trainees.
Industrial relations remained cordial during the year.
I.
Industry Structure
Major portion of worldwide trade continues to move by sea and hence Shipping Industry will always have a significant role in the global economy. Recent years have seen the exponential growth in maritime trade. Seaborne cargo growth in overall terms had been running at an average rate of 4% year on year for the years
2000-05, and has since picked up to about 6% a year. More pertinently, tonne mile demand has soared as raw materials are sourced in ever greater quantities from increasingly longer distances. Last 5 years have seen a major growth in tanker capacity and dry bulk trade has also witnessed high growth in last 2 years.
With the oil price continuing to rule high, focus has shifted to offshore sector and there has been a fair amount of ordering for Oil Rigs, Offshore Supply and Multi-purpose Support Vessels for the offshore industry. India Steamship, however, continues to focus on the aframax tanker segment.
II.
Opportunities and Threats
Oil demand continues to grow at 2% per annum excluding short term aberrations during huge price volatility.
This is the fifth year of a strong growth in freight rate
history. Some analysts are concerned about the huge new building capacity
likely to come in by the end of 2010. The phase out of single hull tankers will
definitely provide some relief and will be a balancing factor. Increasing
refining capacities in
III.
Outlook
Year 2006 ended on a whimper as mild winter weather and high stocks reduced oil demand. Average spot tanker earnings fell 5% in 2006. A modern 105,000 DWT aframax tanker earned about USD 39,000 per day in 2006 compared with about USD 42,000 per day in 2005.
The crude tanker fleet grew by a modest 5.2% to reach 265 million DWT by end of 2006. The product tanker fleet grew by 11.6% to reach 55 million DWT by end of 2006.
Curiously, average 5 year old tanker values rose over 4% during 2006. Average new building tanker prices rose9% in 2006 on strong demand and tight supply.
The crude tanker earnings in the year 2007 could outperform
2006 while product tanker rates may disappoint. Product tankers may perform
better after new refineries in the East go on-stream. The year 2006 witnessed
de-linkage between earnings and asset values as they set off in opposing directions
with earnings going down but asset prices going up. This was testimony not only
to long term belief in the future viability of the tanker markets but also an
indication of excess liquidity with too much money chasing too few
opportunities. If earnings hold up on the crude side in 2007 values may be
vindicated but it is expected that inflated product tanker values will be
tested by continued relatively weak earnings. Contrary to most forecasts, some
analysts are optimistic on the bigger crude tankers in 2007. This optimism is
founded upon doubling of oil demand growth this year after weak growth in 2006.
Relatively lower average oil prices this year should stimulate consumption in
the
IV.
Risks and Concerns
The market outlook is based on certain fundamentals. But any issues such as natural disasters, geopolitical concerns, etc. can alter it significantly which has to be continuously borne in mind. Availability of good quality officers who are the key personnel who man and operate the high value assets at sea, will continue to be in short supply. Shipping Ministry may allow Indian flag vessels to recruit foreign nationals with certain restrictions. This may improve the manning situations marginally.
FOOD PROCESSING UNIT
Industry Outlook
Food Processing Industry has enormous significance for
development of agriculture. Food processing can integrally link agriculture to
the consumers in the domestic and International markets. While agriculture
sector in
The total size of
The Government of India and various State Governments are offering incentives to the Food Processing Industry especially for development of cold chains.
Production and
Processing:
The Company owns and operates ISO 9001-2000 and HACCP certified plant and a leased plant, for processing
frozen vegetables in Sonepat and Karnal districts of Haryana. The Company also outsources frozen peas processing under its supervision at other facilities in Uttarakhand and UP The raw material is procured through a combination of market and direct purchases from farmers. Products like American Sweet corn, Baby corn and Broccoli are procured directly from farmers while products like green peas, carrots, beans and cauliflower are procured from the market.
Entire raw material procured is processed through IQF (Individual Quick Freezing) technology in less than 48 hours of harvest. The raw material as well as finished goods is strictly manufactured as per stringent quality parameters.
Cold Chain Infrastructure
Besides the processing facility, the company has captive storage capacity of 3700 MT, located at Sonepat and Karnal. Storage space of 3500 MT is hired whenever so required.
Human Resources
Development and Industrial Relations:
A high attrition rate was observed on account of major investment in retail sector and cold chains. There are 56
personnel in the facility.
Industrial relations in the Division remained cordial during the year.
Fixed Assets:
Ø Land – Freehold
Ø Land –Leasehold
Ø Buildings
Ø Leasehold Improvements
Ø Railway Siding
Ø Plant and Machinery
Ø Equipment and Appliances
Ø Furniture and Fittings
Ø Vehicles
Ø Vehicles ( on Finance Lease)
Ø Ships
Trade Reference:
Ø Panchvati Valves & Flanges Private Limited
Ø Packwell Plastic Industries
Ø Competent Electric Company
Ø Spiral Seal Gaskets Private Limited
Ø Shiv Ganga Paper Converters Private Limited
Ø
Ø Shree Pesticides (Private) Limited
Ø Sagar Metals
Ø Dembla Valves Private Limited
Ø Mold Well Products
Ø Cylok Pneumatechnics
Ø Dashmesh Auto Engineers
Ø Indana Rubber Industries
Ø Prachi Products
Ø Decohome
Ø Asian Paper Cone Industries
Ø BoxBoard Packaging
Ø Jayantika Packaging
Ø
Ø Nepaso Poly-febrics and Sunshine Offset Press
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.40.38 |
|
|
1 |
Rs.81.88 |
|
Euro |
1 |
Rs.55.52 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
5 |
|
PAID-UP CAPITAL |
1~10 |
5 |
|
OPERATING SCALE |
1~10 |
5 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
6 |
|
--PROFITABILIRY |
1~10 |
4 |
|
--LIQUIDITY |
1~10 |
5 |
|
--LEVERAGE |
1~10 |
5 |
|
--RESERVES |
1~10 |
5 |
|
--CREDIT LINES |
1~10 |
5 |
|
--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 |
|
45 |
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 |
|