MIRA
INFORM REPORT
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Report Date : |
17.12.2007 |
IDENTIFICATION
DETAILS
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Name : |
SABERO ORGANICS GUJARAT LIMITED |
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Registered Office : |
Plot No. 2102 GIDC, Sarigam – 396155, Bulsar District,
Gujarat |
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Country : |
India |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
29.11.1991 |
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Com. Reg. No.: |
64254 |
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CIN No.: [Company
Identification No.] |
L24110GJ1993PLC020753 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
MUMS15850C / SRTS05781G |
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PAN No.: [Permanent
Account No.] |
AABCS5313C |
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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 : |
Manufacturing of chemical intermediates for the pesticides and flame-retardant industries. |
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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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 and reputed company having fine track.
Fundamentals are strong and healthy.
Business is active. Payments are usually correct and as per commitments. The Company can be considered normal for business dealing at usual trade terms and conditions. |
LOCATIONS
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Registered Office/Factory : |
Plot No. 2102 GIDC, Sarigam – 396155, Bulsar District,
Gujarat, India |
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Tel. No.: |
91-260-2780395 / 2780852 |
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Fax No.: |
91-260-2780853 |
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E-Mail : |
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Website : |
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Corporate Office : |
A-302, Phoenix House, 3rd Floor, 62 Senapati
Bapat Marg, Worli (East), Mumbai – 400013, India |
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Tel. No.: |
91-22-24964898 / 24960979 |
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Fax No.: |
91-22-24953727 |
DIRECTORS
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Name : |
Mr. Hero J. Chuganee |
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Designation : |
Chairman |
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Qualification : |
B.Sc., D. Chem E. (London) |
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Experience : |
40 years |
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Name : |
Mr. Mohit H. Chuganee |
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Designation : |
Vice Chairman and Managing Director |
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Name : |
Mr. John R. English |
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Designation : |
Director |
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Name : |
Mr. Raj Tandon |
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Designation : |
Director |
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Name : |
Mr. Anand Swaminathan |
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Designation : |
Director |
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Name : |
Mr. Sumit H. Chuganee |
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Designation : |
Director |
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Name : |
Mr. J. S. Sethi |
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Designation : |
Director – Corporate Affairs |
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Name : |
Dr. U. T. Bhalerao |
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Designation : |
Director |
KEY EXECUTIVES
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Name : |
Mr. Prem Hinduja |
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Designation : |
Company Secretary |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
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Names of Shareholders |
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No. of Shares |
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Promoters Group including Relatives, Associates and Corporate Bodies |
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11288141 |
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Mutual Funds, UTI, Banks and FIIs |
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4300 |
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Indian Public |
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9291828 |
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NRIs/OCBs/ Foreign Company |
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5397373 |
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Private Corporate Bodies |
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1362358 |
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Total
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27344000 |
BUSINESS DETAILS
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Line of Business : |
Manufacturing of chemical intermediates for the pesticides
and flame-retardant industries. |
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Products : |
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PRODUCTION STATUS
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Particulars |
Unit |
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Installed
Capacity |
Actual
Production |
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Inorganic Compounds |
Tonnes |
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16000 |
1120.76 |
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Organo Phosphorus Intermediates |
Tonnes |
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11000 |
2771.28 |
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Pesticides |
Tonnes |
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10580 |
5636.36 |
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Pesticides Formulation [in MT] |
Tonnes |
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3000 |
1226.92 |
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Pesticides Formulation [in KL] |
Tonnes |
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3000 |
2485.31 |
GENERAL
INFORMATION
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No. of Employees : |
About 300 |
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Bankers : |
v Union Bank of India v Bank of India v Oriental Bank of Commerce v IDBI Bank Limited v ICICI Bank Limited |
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Facilities : |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
SMNP and Company Chartered Accountants |
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Subsidiaries : |
Ř Sabero Australia
Private Limited Level 12 Gateway, 1, Macquaire Place,
Sydney 2000, Australia E-mail : sabero@vsnl.com
Ř Sabero Europe BV Middenweg 12, 1619 BL Andjik, The
Netherlands E-mail : sabero@vsnl.com
Ř Sabero Argentina
S. A. Viamonte 850, [1832] Lomas dezamora,
Buenos Aires, Argentina E-mail : sabero@vsnl.com
Ř Sabero Organics
Americas Limited Itauna, Minas Gerais, Brazil E-mail : sabero@vsnl.com
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Associates |
Ř Recall India
Information Management Private Limited Ř Sabero Echostar
[India] Private Limited Ř Harvard Finance
Company Private Limited |
CAPITAL STRUCTURE
Authorised Capital :
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No. of Shares |
Type |
Value |
Amount |
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31000000 |
Equity Shares |
Rs. 10/- each |
Rs. 310.000 Millions |
Issued, Subscribed & Paid-up Capital :
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No. of Shares |
Type |
Value |
Amount |
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27344000 |
Equity Shares |
Rs. 10/-
each |
Rs. 273.440
Millions |
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Less : Calls in arrears |
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Rs. 0.116
Millions |
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Rs. 273.324 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 |
273.324 |
254.827 |
207.300 |
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2] Share Application Money |
2.612 |
28.058 |
0.000 |
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3] Reserves & Surplus |
162.583 |
150.864 |
72.300 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
438.519 |
433.749 |
279.600 |
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LOAN FUNDS |
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1] Secured Loans |
621.588 |
599.457 |
557.700 |
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2] Unsecured Loans |
0.000 |
0.000 |
15.000 |
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TOTAL BORROWING |
621.588 |
599.457 |
572.700 |
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DEFERRED TAX LIABILITIES |
37.274 |
30.074 |
0.000 |
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TOTAL |
1097.381 |
1063.280 |
852.300 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
600.575 |
614.354 |
623.900 |
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Capital work-in-progress |
0.000 |
0.000 |
0.000 |
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INVESTMENT |
0.254 |
0.252 |
0.300 |
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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 |
421.712
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337.352 |
239.200 |
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Sundry Debtors |
178.904
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191.213 |
166.000 |
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Cash & Bank Balances |
90.428
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71.143 |
46.600 |
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Other Current Assets |
0.000
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0.000 |
0.000 |
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Loans & Advances |
204.305
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163.336 |
218.900 |
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Total
Current Assets |
895.349
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763.044 |
670.700 |
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Less : CURRENT
LIABILITIES & PROVISIONS |
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Current Liabilities |
402.012
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311.732 |
436.000 |
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Provisions |
2.125
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2.638 |
6.600 |
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Total
Current Liabilities |
404.137
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314.370 |
442.600 |
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Net Current Assets |
491.212
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448.674 |
228.100 |
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MISCELLANEOUS EXPENSES |
5.340 |
0.000 |
0.000 |
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TOTAL |
1097.381 |
1063.280 |
852.300 |
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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 |
1529.483 |
1377.392 |
1261.500 |
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Other Income |
86.673 |
69.535 |
15.700 |
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Total Income |
1616.156 |
1446.927 |
1277.200 |
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Profit/(Loss) Before Tax |
13.499 |
10.617 |
19.200 |
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Provision for Taxation |
10.113 |
12.297 |
[11.900] |
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Profit/(Loss) After Tax |
3.386 |
[1.680] |
31.100 |
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Earnings in Foreign Currency : |
872.240 |
799.075 |
0.000 |
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Total Imports |
378.402 |
360.499 |
0.000 |
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Expenditures : |
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Materials Consumed |
985.064 |
899.700 |
769.600 |
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Excise Duty |
0.000 |
0.000 |
93.700 |
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Power and Fuel Cost |
0.000 |
0.000 |
131.700 |
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Selling and Administration Expenses |
0.000 |
0.000 |
76.000 |
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Employee related expenditure |
78.205 |
70.818 |
59.600 |
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Manufacturing, administrative Expenses |
380.052 |
326.885 |
21.200 |
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Interest and Finance Charges |
109.026 |
86.801 |
75.900 |
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Depreciation & Amortization |
50.311 |
48.595 |
46.700 |
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Stock Adjustment |
0.000 |
0.000 |
[51.000] |
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Total Expenditure |
1602.658 |
1432.799 |
1223.400 |
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QUARTERLY RESULTS
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PARTICULARS |
|
30.06.2007 |
30.09.2007 |
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Type |
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1st Quarter |
2nd Quarter |
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Sales Turnover |
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420.700
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462.100
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Other Income |
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2.600
|
1.100
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Total Income |
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423.300
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463.200
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Total Expenditure |
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370.400
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411.400
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Operating Profit |
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52.900
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51.800
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Interest |
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29.500
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28.300
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Gross Profit |
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23.400
|
23.500
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Depreciation |
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12.800
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12.900
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Tax |
|
0.500
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0.500
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Reported PAT |
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10.100
|
10.100
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KEY RATIOS
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PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
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Debt-Equity Ratio |
1.45 |
1.71 |
2.07 |
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Long Term Debt-Equity Ratio |
0.62 |
0.88 |
1.25 |
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Current Ratio |
1.09 |
1.03 |
0.94 |
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Fixed Assets |
1.67 |
1.59 |
1.36 |
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Inventory |
4.44 |
5.37 |
6.42 |
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Debtors |
9.11 |
8.66 |
8.78 |
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Interest Cover Ratio |
1.12 |
1.16 |
1.19 |
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Operating Profit Margin(%) |
10.25 |
9.66 |
10.84 |
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Profit Before Interest And Tax Margin(%) |
7.26 |
6.52 |
7.14 |
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Cash Profit Margin(%) |
3.23 |
3.28 |
5.80 |
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Adjusted Net Profit Margin(%) |
0.24 |
0.14 |
2.10 |
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Return On Capital Employed(%) |
11.91 |
10.86 |
11.10 |
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Return On Net Worth(%) |
0.97 |
0.64 |
10.04 |
LOCAL AGENCY
FURTHER INFORMATION
Fixed Assets
Ř Freehold land
Ř Leasehold land
Ř Building
Ř Plant and machinery
Ř Furniture & fixtures
Ř Vehicles.
MANAGEMENT
DISCUSSION AND ANALYSIS
REVIEW OF
OPERATIONS:
The Company's net sales
increased from Rs. 1377.306 Millions in. 2005-2006 to Rs. 1529.483 Millions in
2006-2007. The increase in sales was evenly attributed to growth in domestic
sales and exports. Exports constituted 56% of total net sales. The Company has
reported a Profit before interest, depreciation and taxation of Rs 172.800
Millions in 2006-07 as compared to Rs 140.500 Millions in 2005-06, though the
PBT remained almost the same at around Hs. 13.499 Millions in 2006-2007 as
compared to a PBT of 10.617 Millions in 2005- 2006. The cost of materials as a
percentage of sales continued to stay nigh at appro*. 64.41% of sales and
employee related expenditure saw an increase of 10% over the previous year.
ENTERPRISE SYSTEM:
The Company
maintained a centralized approval system for billing from various C & F's
so as to have in place a more detailed and controlled process for credit
approval. The company will be evaluating options to upgrade its ERP system
during 2007-2008 to meet the greater demand arising out of a growing business.
FUTURE OUTLOOK:
The company hopes
to further increase its sales in 2007-08 and cross the Rs 2000 Millions mark by
increasing the capacity utilization of various plants, as also to substantially
increase its market share in the domestic markets. While the focus of the
company is still firmly concentrated on the international markets as a long
term strategy, the company has also a renewed focus on domestic markets
(industrial sales and branded formulation) in the current year. In the current
year, recognizing the branded formulation segment as a strategic area, the
company has increased its field sales force, hired additional product
development field personnel so as to grow this segment rapidly and with renewed
focus. The results of these initiatives are already showing in the current
year.
The multipurpose
insecticide plant was also debottlenecked last year so as to bring better
productivity in the monocrotophos and acephate plants, which will help in
increasing sales.
The Company also hopes
to commercialize some new products which are oft-patent generic products such
as dithiocarbamate fungicides and herbicides towards the end of the current
year in the existing facilities by de-bottlenecking and investing in balancing
equipment. All these increased volumes and products will keep the marketing
team busy in 2007 through 2008.
The company's
joint venture in Brazil is also expected to be operational by October, 2007 and
the joint venture expects to have over 35 field sales force personnel in Brazil
by the end of the year.
The company hopes
to derive a saving of atleast Rs 40 Millions per year by account of changing
the feedstock for generation of steam from furnace oil to gas in the current
year. The company started getting gas supplies from GSPC Limited in March, 07
which will result in reduction of the energy costs of the company. In addition,
gas is a cleaner fuel and more environmentally friendly. While the commencement
of supplies of gas was delayed by six months, the impact of this saving
will be reflected
in the current year. In addition, the company continues its earnest efforts in
energy conservation and has ongoing in house projects to reduce energy costs.
SAFETY, HEALTH
& ENVIRONMENT (SHE) & ISO 9001 & ISO 14001:
The Company is meeting
all the requirements of the Gujarat Pollution Control Board and has a well
integrated audit system on safety,
health and environment. The Company has renewed its certification for ISO 9001
and ISO 14001 under the new combined integrated EMS System of ISO and is valid
till 31s: December, 2008. The Company has invested in a byproduct recovery
plant that was commissioned in April; 2006. In the current year, the company
has commissioned a new, state of the art, liquid, solid, and gaseous waste
incinerator of a much larger capacity and superior technology with dual teed
(gas and oil) burners, which will take care of the company's
current as also
future incineration needs. This investment is a signal of the commitment the
company has in fully complying with the SHE requirements.
Long term
Debts/Finance:
Besides working
capital borrowings (short term and long term) from the company's bankers, the
company now has only Rs 230 Millions pending in long term loans payable to
ICICI, IDBI and CCP, as of March 31, 07. The company has repaid back Rs 50
Millions in the financial year 06-07, and will be paying the balance term loans
as per the repayment schedule thereby having a much more favourable debt/equity
ratio in the near term.
HISTORY
The company was incorporated on 29th November, 1991 at Mumbai in Maharashtra having Company Registration Number 64254
The company's registered office was transferred from Mumbai to Gujarat with effect from 2nd December, 1993 and a new Company Registration Number 20753 of Gujarat ROC was obtained.
AS PER WEBSITE DETAILS:
Subject
was established in the year 1991 to manufacture specialty chemicals and
intermediates for the crop protection business. Sabero then forward integrated
in 1997 into manufacturing crop protection chemicals. In order to
have a diversified portfolio, Sabero chose one or two key products in each
sector such as Acephate and Monocrotophos (Insecticides), Glyphosate
(Herbicide) and Mancozeb (Fungicide). As the company was already manufacturing
some of the intermediates for these products, it excelled in the technology for
manufacturing organophosphorus and dithiocarbamate products.
Apart
from sales of unbranded technical and formulations, the Company also
established in 1997 its business of branded agrochemical formulations. It
launched a full range of products, which included in addition to its own
technical based product, other products such as Ethephon, Cypermethrin,
Chlorpyriphos, Dichlorvos, Profenofos, Triazophos, Propiconazole, Hexconazole
etc.
The
company went public in the year 1994 through an IPO (Initial Public Offer),
which was followed up by a Rights Issue in 1997, and is today a listed Company
on the Bombay Stock Exchange and National Stock Exchange in India.
Sabero
currently employs over 400 people with Competent managerial, technical,
supervisory and administrative skills come together as one team: one force that
transcend designations. Driven by a common commitment, they strive for
excellence in its smallest details.
To
keep motivational levels high and capabilities razor sharp, Sabero conducts
regular seminars and refresher courses, both in-house and at various training
schools. They are therefore, constantly in touch with latest developments
around the world.
Sabero
has made a substantial investment in data generation on products at various GLP
laboratories both in India and Europe and has registered its products in
various countries. Comprehensive registrations dossiers are available for all
the company's core products. The Company currently has distributors in various
countries and exports its products to over 50 countries covering Australia,
Asia, Africa, Europe, Middle East and the Americas. In order to facilitate the
registration of its products and provide better customer service, the company
has recently set up subsidiaries in Australia, Argentina, Netherlands and
Brazil.
Sabero
has an extensive manufacturing facility with state-of-the-art sophisticated
equipments and PLC based process control with an asset base of over USD 25
million. The Company is a signatory to the Responsible Care Program and has
extensive facilities for treatment of all wastes to meet statutory
environmental standards.
Sabero
has a state-of-the-art R & D center and pilot plant with sophisticated
analytical equipment and well qualified dedicated research fellows and
scientists for the continuous improvement of existing products and the
development of new ones. The R & D facilities of the Company are approved
by the Indian Regulatory agency called CSIR - Council of Scientific and
Industrial Research. All the existing products manufactured by the Company have
been developed by Sabero in its in-house R & D. Further developmental work
is being done on new generics, which will be shortly going off patent,
including insecticides, herbicides, fungicides and intermediates so that they
are in a position to be a primary generic supplier. Sabero has succeeded
due to a combination of factors. A winning formula that they call "The
right chemistry at work".
At
Sabero, their social concerns also extend to the entire society and community
in which they live. In pursuing this goal, the company has organized various
social and developmental programs at its community center and in the
neighboring villages involving activities such as blood donation camps, free
medical aid, scholarships to students, beautification of railway stations,
providing wheel chairs for the handicapped, planting trees.
PRODUCTS
Ř
Specialty Chemicals & Intermediate
products
and their Specification
Ř Agrochemical formulations Specification
Ř
Agrochemical Active Ingredients
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. 39.35 |
|
UK Pound |
1 |
Rs. 80.36 |
|
Euro |
1 |
Rs. 57.62 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
6 |
|
OPERATING SCALE |
1~10 |
6 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
5 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
YES |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
60 |
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 |
|