MIRA INFORM REPORT
|
Report Date : |
12.02.2007 |
IDENTIFICATION DETAILS
|
Name : |
HINDUSTAN
ADHESIVES LIMITED |
|
|
|
|
Registered Office : |
340/2-A,
G. T. Road, Shahdara, Delhi - 110095 |
|
|
|
|
Country : |
India
|
|
|
|
|
Financials (as on) : |
31.03.2006 |
|
|
|
|
Date of Incorporation : |
05.04.1988 |
|
|
|
|
Com. Reg. No.: |
55-31191 |
|
|
|
|
CIN No.: [Company Identification No.] |
U74899DL1988PTC031191 |
|
|
|
|
TAN No.: [Tax Deduction & Collection Account No.] |
DELH00730C |
|
|
|
|
Legal Form : |
Public
Limited Liability Company. The
company’s shares are listed on the Stock Exchanges. |
|
|
|
|
Line of Business : |
Manufacturing of Self
Adhesives Tapes and BOPP Films. |
RATING & COMMENTS
|
MIRA’s Rating : |
C |
RATING
|
STATUS |
PROPOSED CREDIT LINE |
|
|
<10 |
C |
Absolute credit risk
exists. Caution needed to be exercised |
Credit not recommended |
|
Maximum Credit Limit : |
|
|
|
|
|
Status : |
Poor |
|
|
|
|
Payment Behaviour : |
Slow & Delayed |
|
|
|
|
Litigation : |
- |
|
|
|
|
Comments : |
Subject
is a well-established company having moderate track. Directors are reported as experienced and
respectable businessmen. Financial
position of the company is moderate.
Payments are reported as slow and delayed. The
company is not faring well and expected to register further losses in the
current year. The
company can be considered for any business dealings on safe and secured trade
terms and conditions |
LOCATIONS
|
Registered Office : |
340/2-A, G. T. Road,
Shahdara, Delhi - 110095, India |
|
Tel. No.: |
91-11-22111379/23719734 |
|
Fax No.: |
91-11-23328210 |
|
E-Mail : |
|
|
|
|
|
Head Office : |
B-2
/ 8, Safdarjung Enclave, New Delhi – 110 029 |
|
Tel. No.: |
91-11-51650346-48,
51650350 |
|
Fax No.: |
91-11-51650349
|
|
E-Mail : |
|
|
|
|
|
Factory 1 : |
29th
Mile Stone, Village Achheja, Tehsil Dadri, District Gautam Budh Nagar, Uttar
Pradesh |
|
|
|
|
Branches : |
P. O. Box: 3842, # 1014/1,
“Archana”, 17 “C” Cross, Indira Nagar II Stage, Bangalore – 560 038,
Karnataka, India
|
DIRECTORS
|
Name : |
Mr. M. S. Bagla |
|
Designation : |
Managing Director |
|
|
|
|
Name : |
Mr. L. K. Bagla |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Mrs. Urmila Goenka |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. U. C. Gaur |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. O. P. Tiwari |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Purshotam Agarwal |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Kailash Chand Dwivedi |
|
Designation : |
Whole time Director |
|
|
|
|
Name : |
Mr. Venkateswara Rao
Yedlapalli |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. P. K. Agarwal |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. M. M. Haque |
|
Designation : |
Additional Director |
KEY EXECUTIVES
|
Name : |
Mr. S. S. Dua |
|
Designation : |
Company Secretary |
BUSINESS DETAILS
|
Line of Business : |
Manufacturing of Self
Adhesives Tapes and BOPP Films. |
|
|
|
|
Products : |
Tear Tapes Adhesive Tapes Self Adhesive Tapes Packaging Tapes Specialty Tapes BOPP Tapes |
PRODUCTION STATUS
|
Particulars |
Unit |
|
Licensed Capacity |
Installed Capacity |
|
Self Adhesives Tapes |
SQM |
|
60000000 |
52000000 |
|
BOPP Film |
MT |
|
2500 |
2500 |
GENERAL INFORMATION
|
Customers : |
I.T.C Limited Godfrey Phillips India
Limited Vst Industries Limited Gtc Industries Limited Asia Tobacco Co. Limited The Hyderabad Deccan
Cigarette Factory Pvt. Ltd. Western Tobacco Limited Reliable Cigarette And
Tobacco Industries Pvt. Ltd. National Tobacco Company
Limited Cadbury India Limited Castrol India Limited Dhl Wpx Limited Glaxosmithkline Consumer Hindustan Coco Cola Indian Airlines Limited Kodak India Limited Nestle India Limited Procter & Gamble Pepsico India Holding Reliance India Limited Bayer India Limited Brittania India Limited |
|
|
|
|
No. of Employees : |
1500 |
|
|
|
|
Bankers : |
·
United Western Bank
Limited, 2046, Gurudwara Road, Karol Bagh, Delhi -
110 005 ·
The Benares State Bank
Limited, New Delhi ·
Allahabad Bank,
Ghaziabad, Uttar Pradesh |
|
|
|
|
Banking Relations : |
Unknown |
|
|
|
|
Auditors : |
Salarpuria
& Partners Chartered
Accountants |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
6000000 |
Equity
Shares |
Rs. 10/- Each |
Rs. 60.000 millions |
Issued, Subscribed
& Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
5120000 |
Equity
Shares |
Rs. 10/- Each |
Rs. 51.200 millions |
FINANCIAL
DATA
[all figures are in Rupees Millions]
ABRIDGED
BALANCE SHEET
|
SOURCES OF FUNDS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
51.200 |
51.200 |
51.200 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
[44.200] |
(44.700) |
(34.500) |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
NETWORTH
|
7.000 |
6.500 |
16.700 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
225.100 |
226.600 |
231.900 |
|
|
2] Unsecured Loans |
28.900 |
35.100 |
35.400 |
|
TOTAL
BORROWING
|
254.000 |
261.700 |
267.300 |
|
|
DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
TOTAL
|
261.000 |
268.200 |
284.000 |
|
|
|
|
|
|
|
APPLICATION OF FUNDS
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block]
|
163.600 |
171.700 |
182.600 |
|
Capital work-in-progress
|
3.200 |
0.000 |
0.000 |
|
|
|
|
|
|
|
INVESTMENT
|
0.300 |
00.200 |
02.000 |
|
DEFERREX TAX ASSETS
|
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES
|
|
|
|
|
|
|
Inventories
|
41.300
|
46.600
|
48.500 |
|
|
Sundry Debtors
|
70.200
|
66.100
|
68.800 |
|
|
Cash & Bank Balances
|
5.600
|
05.300
|
06.900 |
|
|
Other Current Assets
|
0.000
|
0.000
|
0.000 |
|
|
Loans & Advances
|
62.900
|
56.300 |
53.700 |
Total Current Assets
|
180.000
|
174.300 |
177.900 |
|
Less : CURRENT LIABILITIES & PROVISIONS
|
|
|
|
|
|
|
Current Liabilities
|
83.900
|
76.400
|
77.400 |
|
|
Provisions
|
2.200
|
01.600
|
01.500 |
Total Current Liabilities
|
86.100
|
78.000
|
78.900 |
|
Net Current
Assets
|
93.900
|
96.300
|
99.000 |
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES
|
0.000 |
0.000 |
0.400 |
|
|
|
|
|
|
|
TOTAL
|
261.000 |
268.200 |
284.000 |
|
PROFIT & LOSS ACCOUNT
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
Sales Turnover [including other income]
|
367.900 |
324.600 |
316.600 |
|
|
|
|
|
Profit/(Loss) Before Tax
|
1.500 |
(15.600) |
(20.900) |
Provision for Taxation
|
1.000 |
(05.400) |
(02.600) |
Profit/(Loss) After Tax
|
0.500 |
(10.200) |
(23.500) |
|
|
|
|
|
Export Value
|
72.249 |
55.693 |
N.A. |
|
|
|
|
|
Total Expenditure
|
366.400 |
340.200 |
337.500 |
QUARTERLY
RESULTS
|
Particulars |
30.06.2006
[1st
Qtr.] |
30.09.2006
[2nd Qtr.] |
31.12.2006
[3rd
Qtr.] |
|
Sales
Turnover |
74.700 |
91.300 |
89.700 |
|
Other
Income |
0.000 |
0.000 |
0.100 |
|
Total
Income |
74.700 |
91.300 |
89.800 |
|
Total
Expenditure |
67.500 |
81.100 |
80.200 |
|
Operating
Profit |
7.200 |
10.200 |
9.600 |
|
Interest |
3.500 |
3.200 |
3.500 |
|
Gross
Profit |
3.700 |
7.000 |
6.100 |
|
Depreciation |
4.200 |
4.300 |
4.300 |
|
Tax |
0.100 |
0.100 |
0.200 |
|
Reported
PAT |
[0.600] |
2.600 |
1.600 |
Notes:
200606 Quarter 1
Result has been calculated by
Capitaline and not published by the company. Extra Ordinary Items have not been
calculated for the Quarter
200609 Quarter 2 Expenditure Includes
(Increase) / Decrease in Stock in Trade Rs (2.70)million Consumption of Raw
Materials Rs 59.80 million Staff Cost Rs 4.10 million Other Expenditure Rs
19.90 million Tax Indicates Provision for Fringe Benefit Tax Status of Investor
Complaints for the quarter ended September 30, 2006 Complaints Pending at the
beginning of the quarter Nil Complaints Received during the quarter 01
Complaints disposed off during the quarter 01 Complaints unresolved at the end
of the quarter Nil 1. Above results were taken on record by its Board of
Directors at the meeting held on October 30, 2006. 2. Segment reporting as
defined in Accounting Standard 17 is not applicable to the Company. 3. Result
for the quarter ended September 30, 2006 have been received by the Auditors of
the Company.
200612 Quarter 3
Expenditure Includes
(Increase)/Decrease in stock in Trade Rs (2.40) million Consumption of Raw
Material Rs 57.00 million Staff Cost Rs 4.80 million Other expenditure Rs 20.80
million Tax indicate Provision for Fringe Benefit Tax Status of Investor
Complaints for the quarter ended December 31, 2006 Complaints Pending at the
beginning of the quarter Nil Complaints Received during the quarter 01
Complaints disposed off during the quarter 01 Complaints unresolved at the end
of the quarter Nil 1. Above results were taken on record by its Board of
Directors at the meeting held on January 30, 2007. 2. Segment reporting as
defined in Accounting Standard 17 is not applicable to the Company. 3. Result
for the period ended December 31, 2006 have been received by the Auditors of
the Company.
KEY RATIOS
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
Debt
Equity Ratio |
38.20 |
22.80 |
9.38 |
|
Long
Term Debt Equity Ratio |
28.36 |
17.00 |
7.00 |
|
Current
Ratio |
1.19 |
1.21 |
1.26 |
|
TURNOVER
RATIOS |
|
|
|
|
Fixed
Assets |
1.16 |
1.03 |
1.05 |
|
Inventory
|
8.52 |
6.84 |
5.99 |
|
Debtors |
5.49 |
4.82 |
4.73 |
|
Interest
Cover Ratio |
1.13 |
0.08 |
0.17 |
|
Operating
Profit Margin (%) |
8.39 |
5.35 |
6.14 |
|
Profit
Before Interest and Tax Margin (%) |
4.01 |
0.43 |
1.28 |
|
Cash
Profit Margin (%) |
4.54 |
1.78 |
(2.32) |
|
Adjusted
Net Profit Margin (%) |
0.16 |
(3.14) |
(7.18) |
|
Return
on Capital Employed (%) |
5.02 |
0.00 |
0.00 |
|
Return
on Net Worth (%) |
1.47 |
0.00 |
0.00 |
STOCK PRICES
|
Face Value |
Rs.10/-
each |
|
High |
Rs.2.89/- |
|
Low |
Rs.1.95/- |
LOCAL AGENCY FURTHER INFORMATION
History
:
Incorporated
on 5 April, 1988, Hindustan Adhesives (HAL) was promoted L K Bagla and M S
Bagla for manufacturing bi-axially oriented polypropylene (BOPP) self-adhesive
tapes (cap. : 52 mln sq mtr pa) and BOPP films (cap. : 2500 tpa), at Ghaziabad,
UP. The company has state-of-the-art equipment like the acrylic adhesive
coating machine, hot melt coating and adhesive making machine and BOPP film
making equipment.
The BOPP adhesive tapes are mainly used in the packaging industry. HAL markets
these tapes under the brand names Mystic, Stic Me, and Boss Tech, while its
major clients include the Jindal group, SIEL, Dabur and Parasrampuria.
The film manufactured by the BOPP film plant is used captively for
manufacturing PSA tapes. In 1994, the company implemented its backward
integration project for manufacturing bi-axially oriented poly-propylene films.
To part-finance this project, the company came out with an issue of equity
shares at a premium of Rs 15 in August 1994.
The company has expanded its BOPP film plant by installing another plant of
1300 tpa. The project was funded through internal accruals. During 1999-2000,
the company was awarded ASIASTAR' 99 award from the Asian Packaging Federation
for developing self-adhesive tear tapes of world-class quality. As the demand
for BOPP film products was increasing the company has opened the BOPP film unit
which was closed since last 4 years.
OPERATIONS
During the year under report :
The Company has turned around and reported Profits after a long period of time
due to the focused attention on the Production of Self Adhesive Coated
products. The turnover for Adhesive Coated products has substantially increased
and the company has also made plans for further enhancement of capacities to
produce Packaging Tapes in view of the favorable market conditions. There is
general buoyancy in the Indian manufacturing sector and the company sees this
as an opportunity to expand the sales and enhance the profits in the years to come.
As before the company restrained from selling BOPP film in the market due to
the unfavorable market conditions and limitations of the installed BOPP film
plant, but however continued to produce BOPP film for its own consumption. The
Promoters are of the firm opinion that the BOPP film produced by it is of a
superior quality, for the production of the finished product by the company
namely BOPP Packaging Tapes. By consuming its own BOPP film for the finished
product, the company commands a premium in the market for the finished product
and hence the future strategy of the company is to enhance the finishing
facilities by adding Coating capacities and hence also maximizing the
production of BOPP film for captive consumption.
During the year the company has also obtained Power connection from UPSEB and
installed High Voltage Stabilizers and UPS systems so that the dependency on
high fuel cost DG Sets can be reduced and the net power cost of the Company be
lowered by utilizing more of State Electricity Board Power as against
self-generation.
During January 2006, unfortunately a major fire occurred in the adhesive tape
division destroying raw material, working progress, finished goods, to the tune
of approximate Rs. 3.783 millions for which Insurance Claim has been filed and
the assessment of the same is under finalization, pending with National
Insurance Company Ltd., likely to be completed in the current financial
year.
CURRENT SCENARIO
The growing sales of Packaging Tapes and Specialty Adhesive Coated products
have shown positive results and the company is focusing on these markets. The
export sales have also increased by 29% and the Domestic Sales of adhesive
coated products by 13%. The partial introduction of VAT last year has also been
beneficial for the sales of the company and the complete implementation of the
same in the current financial year will further strengthen the company's sales
and expand the markets besides reduce unfair competition. The Company is now
accredited with both ISO-9001 and ISO-14001 Certifications and commands a
greater respect from its customers and this will also help in increasing the
sales of the product in the current year.
The expansion of adhesive coating, printing and slitting facilities by
installation of additional machines in the current year will add to the sales
and profitability of the company in the current year and the company is
optimistic of better and more positive financial results in the current
year.
The Company has continued to get the support of the Financial Institutions and
Banks and with their understanding and support it is hopeful of reducing the
interest costs and repayment obligations so as to make them sustainable in view
of the operations of the company, and adequately commensurate to the cash
generations every year.
FINANCIAL RESULTS
The total income of the Company has increased by 15% in the current year and
also the PBIDT has increased by 82% despite loss due to fire. This is an
indication of the times to come in the coming year and the company is hopeful
of increasing its performance on a year to year basis from the current
financial year. The company is also making an effort to reduce the long-term
debts by settling one-time the dues of the secured lenders and expects positive
results in the coming financial year.
PROFILE
Thriving
on cutting edge technology, cost effective techniques of production, high level
of industry expertise and capability to offer customize products, they are a
leading manufacturer and exporter of adhesive tapes that includes, self
adhesive tapes, Tear Tapes, Adhesive Tapes, Packaging Tapes, Specialty Tapes
and BOPP Tapes.
They
use high quality raw material to manufacture their products and are capable of
providing their clients with various bonding options to suit the purpose of
their clients. With the standard length and width of the products, they provide
adhesive tapes in customized sizes to their clients. They follow stringent
quality control norms to ensure their products are in conformation with the
internationals standards. All production process are carried out in house in
their state-of-the-art manufacturing unit equipped with latest and
sophisticated machinery.
They maintain a huge inventory, process orders quickly and strive hard to deliver
their products on time to their customers.
They
provide their customers with the 5 advantages that include:
Extended Product Range
HAL's
biggest advantage is the diverse range of products. They manufacture many kinds
of self adhesive tear tapes from the premium to economy version.
A Smart Global Distribution
They
have a wide distribution network across the globe to service the requirements
of their customers, wherever they may be. With ready stocks and technical
backup, you can be assured of the best service to match the quality and the
range of products at all times.
The Reliability Factor
With
a customer base that spans the globe, HAL has in the 17 years been accepted as
a more reliable source for tear tapes, other tapes worldwide.
Fair Pricing Policy
Following
the policy of cost plus pricing, HAL is today seen as a company that not only
offers innovative products, but at a fair price too. Their customers recognize
this and now enjoy the benefit of higher margin of saving when compared to
their previous cost of tear tape.
Technical Savvy
Since,
they their selves manufacture Polypropylene film, they are in a better position
to understand the behavior of different plastic films in various operating
conditions and applications. With facilities for all types of adhesive coating
- from acrylic emulsions to solvent based and hot melt rubber based adhesives,
they have technical expertise to understand all types of adhesive coatings. And
an in-house R&D facility coupled with the most modern printing slitting and
spooling machines enable them to offer the latest and the best.
Mission
To interact closely with customers,
developing packaging solutions and providing them with a complete range of
products as per their requirements. In the process, maintaining leadership
status in the adhesive tape industry in world.
They believe that with their dedication and cost advantage in India they can
service the world market offerings numerous advantages to their customers and
distributors partnering them in their mission.
CMT REPORT [Corruption, Money laundering & Terrorism]
The
Public Notice information has been collected from various sources including but
not limited to: The Courts, India Prisons Service, Interpol, etc.
1] INFORMATION
ON DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.
2] Court
Declaration :
No records exist to suggest that subject is or was the
subject of any formal or informal allegations, prosecutions or other official
proceeding for making any prohibited payments or other improper payments to
government officials for engaging in prohibited transactions or with designated
parties.
3] Asset
Declaration :
No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.
4] Record
on Financial Crime :
Charges or conviction registered
against subject: None
5] Records
on Violation of Anti-Corruption Laws :
Charges or investigation registered
against subject: None
6] Records
on Int’l Anti-Money Laundering Laws/Standards :
Charges or investigation registered
against subject: None
7] Criminal
Records
No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.
8] Affiliation
with Government :
No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.
9] Compensation
Package :
Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.
10] Press Report :
No press reports / filings exists on the subject.
CORPORATE
GOVERNANCE
MIRA
INFORM as part of its Due Diligence do provide comments on Corporate Governance
to identify management and governance. These factors often have been predictive
and in some cases have created vulnerabilities to credit deterioration.
Our
Governance Assessment focuses principally on the interactions between a
company’s management, its Board of Directors, Shareholders and other financial
stakeholders.
CONTRAVENTION
Subject
is not known to have contravened any existing local laws, regulations or
policies that prohibit, restrict or otherwise affect the terms and conditions
that could be included in the agreement with the subject.
FOREIGN
EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US
Dollar |
1 |
Rs.44.16 |
|
UK
Pound |
1 |
Rs.86.00 |
|
Euro |
1 |
Rs.57.56 |
RATING
|
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely
sound financial base with the strongest capability for timely payment of
interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate
working capital. No caution needed for credit transaction. It has above
average (strong) capability for payment of interest and principal sums |
Large |
|
56-70 |
A |
Financial &
operational base are regarded healthy. General unfavourable factors will not
cause fatal effect. Satisfactory capability for payment of interest and
principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is
considered normal. Capable to meet normal commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable &
favourable factors carry similar weight in credit consideration. Capability
to overcome financial difficulties seems comparatively below average/normal. |
Small |
|
11-25 |
Ca |
Adverse factors are
apparent. Repayment of interest and principal sums in default or expected to
be in default upon maturity |
Limited with full
security |
|
<10 |
C |
Absolute credit risk
exists. Caution needed to be exercised |
Credit not recommended |