MIRA INFORM REPORT
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Report Date : |
03.03.2007 |
IDENTIFICATION
DETAILS
|
Name : |
SRF LIMITED |
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Registered
Office : |
A – 16, Aruna Asaf Ali Marg, Qutab Industrial Area, New Delhi - 110067 |
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Country : |
India |
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Financials (as
on) : |
31.03.2006 |
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Date of
Incorporation : |
09.01.1970 |
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Com. Reg. No.: |
55-5197 |
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CIN No.: |
L18101DL1970PLC005197 |
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Legal Form : |
A Public Limited Liability Company. The Company’s Shares are Listed on
the Stock Exchanges |
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Line of Business
: |
Manufacturers and Marketers of synthetic filament yarn including
industrial yarn/tyre cord, nylon
tyre cord fabric/industrial yarn
fabric, fishnet twine, engineering plastic, nylon moulding powder, leather
auxiliaries, (organic chemicals) (dry weight), fluorocarbon refrigerant
gases, hydrochloric acid (anhydrous), gypsum (by product), hydrochloric acid
(by product), halon, chloromethanes and spectacle lenses of other materials
(plastics) castings. |
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 23500000 |
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Status : |
Satisfactory |
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Payment
Behaviour : |
Usually Correct |
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Litigation : |
Clear |
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Comments : |
Subject is a well-established and reputed company having satisfactory track.
Directors are well-known industrialists having good means of their own. Their
trade relations are reported as fair. Financial position of the company is
satisfactory. Business is active. The company's payments are reported as slow
but correct. The company can be considered normal for business dealings at usual
trade terms and conditions. |
LOCATIONS
|
Registered
Office : |
A – 16, Aruna Asaf Ali Marg, Qutab Industrial Area, New Delhi –
110067, India |
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Tel. No.: |
91-11-23318155/23319554/23738486 - 95 |
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Fax No.: |
91-11-23324052/28818793 |
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E-Mail : |
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Website : |
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Corporate Office : |
Block – C, Sector – 45, Gurgaon [Haryana] - 122003 |
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IT Business: |
"Amar Sindur", 4th Floor, No. 43, Pantheon Road,
Egmore, Chennai - 600 008, Tamilnadu |
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Divisonal Offices: |
International Division
C-8, Commercial Complex, Safdarjung Development Area, New Delhi 110
016 Industrial Synthetics
Division
Manali Industrial Area, Chennai – 600 068, Tamilnadu Industrial Fabrics Division:
Viralimalai, Podukottai District – 621 316, Tamilnadu - 621 316 polyester film business
C-8, Commercial Complex, Safdarjung Development Area, New Delhi – 110
016 PHARAMA
CHEMICALS BUSINESS 3rd Floor, Sanskrit Bhawan, A – 10, Aruna Asaf Ali Marg,
Qutub Institutional Area, New Delhi – 110 067. |
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Factory: |
TECHNICAL TEXTILES Business
·
Manali Industrial Area, District Chingleput, Tamilnadu ·
Industrial Area, Malanpur, Bhind District, Madhya Pradesh ·
Plot No. 1, SIPCOT Industrial Area Complex, Gummidipoondi, District
Thiruvallur, Tamilnadu Industrial
Fabrics Business
Viralimalai, Podukottai District – 621 316, Tamilnadu Chemicals Business / PHARMA
CHEMICALS BUSINESS
Village Jhiwana, Tehsil Tijara, District Alwar – 301 019, Rajasthan polyester film business
Plot No. C – 18, C 21-30, Indore Special Economic Zone, Pitampur,
District Dhar, Madhya Pradesh FLUORO
CHEMICALS BUSINESS/ CHEMICAL BUSINESS Village & PO – Jiwana, Tehsil – Tijara, District – Alwar
(Rajashtan) – 301 018 PACKAGING FILMS BUSINESS; SEZ Indore,
Sector – 3, Pithampur, District Dhar (Madhay Pradesh) Plot No. 12,
Rampura, Ramnagar Road, Kashipur, District – Udham Singh Nagar, Uttaranchal. Plot No. C –
1-8, C 21 – 30, Indore Special Economic Zone, Pitam Pur, Dhar, Indore |
DIRECTORS
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Name : |
Mr. Dr. Bharat Ram |
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Designation : |
Chairman Emeritus |
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Name : |
Mr. Arun Bharat Ram |
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Designation : |
Chairman & Senior Managing Director |
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Name : |
Mr. Ashish Bharat Ram |
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Designation : |
President & executive Director |
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Name : |
Mr. S. P. Agarwala |
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Designation : |
Director |
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Name : |
Mr. K. Ravichandra |
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Designation : |
Director (Safety & Environment) |
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Name : |
Mr. V. R. Mehta |
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Designation : |
Director |
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Name : |
Mr. M. V. Subbiah |
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Designation : |
Director |
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Name : |
Mr. Satish K. Kaura |
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Designation : |
Director |
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Name : |
Mr. Vinayak Chatterjee |
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Designation : |
Director |
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Name : |
Mr. Subodh Bharagava |
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Designation : |
Director |
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Name : |
Dr. Omkar Goswami |
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Designation : |
Director |
KEY EXECUTIVES
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Name : |
Mr. Anoop K. Joshi |
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Designation : |
Company Secretary |
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Name : |
Mr. Kartikeya Bharat Ram |
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Designation : |
President & Executive Director |
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Name : |
Mr. N. Ramanathan |
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Designation : |
President (TQM) |
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Date of
Birth/Age : |
55 years |
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Qualification : |
B.E. (MECH),
PGDBM |
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Experience : |
32 years |
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Date of
Appointment : |
01.04.1989 |
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Name : |
Mr. W. M. De'Souza |
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Designation : |
President & Chief Executive Officer
(Industrial Synthetics Business) |
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Name : |
Mr. S. Y. G. Narayanan |
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Designation : |
Senior Vice President (Legal, Shares &
Secretarial) |
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Name : |
Mr. Sushil Ramola |
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Designation : |
Senior Vice President & Chief
Executive Officer (Information Technology Business) |
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Name : |
Mr. Rajdeep Anand |
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Designation : |
Senior Vice President & Chief
Executive Officer (Chemicals Business) |
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Name : |
Mr. T. Sanyal |
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Designation : |
Senior Vice President & Chief
Executive Officer (Industrial Fabrics Business) |
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Name : |
Mr. Roop Salotra |
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Designation : |
Vice President & COO (Chemicals
Business) |
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Name : |
Mr. Sushil Kapoor |
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Designation : |
Senior General Manager & COO
(Industrial Synthetics Business) |
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Name : |
Mr. Suresh Dutt Tripathi |
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Designation : |
Senior General Manager (Human Resources) |
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Name : |
Mr. Ravi K.
Sinha |
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Designation : |
Chief Executive Officer & Group Head |
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Date of
Birth/Age : |
54 years |
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Qualification : |
B.Sc. (Eng)., PGDMS |
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Experience : |
34 years |
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Date of Appointment
: |
01.01.1977 |
MAJOR SHAREHOLDERS
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
|
Promoters |
25421638 |
39.40 |
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Mutual Funds & UTI |
6519845 |
10.10 |
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Banks, Financial Institution, Insurance Companies |
5625979 |
8.72 |
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Foreign Institutional Investors |
10437425 |
16.18 |
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Private Corporate Bodies |
4316859 |
6.69 |
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Indian Public |
11004906 |
17.05 |
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NRIs/OCBs |
196410 |
0.30 |
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Other (including
shares in transit) |
1003027 |
1.55 |
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TOTAL |
64526089 |
100.00 |
BUSINESS DETAILS
|
Line of Business
: |
Manufacturers and Marketers of synthetic filament yarn including
industrial yarn/tyre cord, nylon
tyre cord fabric/industrial yarn
fabric, fishnet twine, engineering plastic, nylon moulding powder, leather
auxiliaries, (organic chemicals) (dry weight), fluorocarbon refrigerant
gases, hydrochloric acid (anhydrous), gypsum (by product), hydrochloric acid
(by product), halon, chloromethanes and spectacle lenses of other materials
(plastics) castings. |
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Products : |
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PRODUCTION STATUS
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Particulars |
Unit |
Registered
Capacity |
Installed
Capacity |
Actual
Production |
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Synthetic Filament Yarn including
Industrial Yarn/ Tyre Cord |
MT |
25000 |
34800 |
2447.86 |
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Nylon Tyre Cord Fabric/ Industrial Yarn
Fabric |
MT |
46180 |
39730 |
35237.41 |
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Fluorocarbon Refrigerant Gases |
MT |
25000 |
25000 |
12790.51 |
|
Hydrofluoric Acid (Anhydrous) |
MT |
7500 |
8300 |
10.89 |
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Gypsum (By Product) |
MT |
25500 |
33300 |
23987.67 |
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Hydrochloric Acid (By Product) |
MT |
67500 |
70000 |
57757.18 |
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Chloromethane |
MT |
22500 |
32000 |
17669.83 |
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Packaging Films |
MT |
25650 |
25650 |
21062.12 |
GENERAL
INFORMATION
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No. of Employees
: |
4000 |
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Bankers : |
ICICI Bank Limited, New Delhi State Bank of India, New Delhi State Bank of Patiala, New Delhi The Hongkong & Shanghai Banking Corporation Limited, New Delhi Citibank N.A., New Delhi Punjab National Bank, New Delhi |
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Facilities : |
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Banking
Relations : |
Satisfactory |
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Auditors : |
Thakur, Vaidyanath Aiyar & Company Chartered Accountants |
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Address: |
212, Deen Dayal Marg, New Delhi
- 110002 |
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Tel. No.: |
91-22-23236958-60/23237772 |
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Fax No.: |
91-22-23230831 |
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E-Mail : |
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Associates: |
SRF Properties Limited SRF Polymers Limited Bhairav Farms Private Limited Narmada Farms Private Limited |
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Subsidiaries: |
SRF Overseas Limited SRF Americas Inc SRF International (BVI) Limited SRF International (Mauritius) Limited SRF Technologies Inc SRF Properties Limited SRF Transnational Holdings Limited |
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Membership: |
Confederation of Indian Industry |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
120,000,000 |
Equity Shares |
Rs.10/- each |
Rs.1,200.000
millions |
|
1000000 |
Preference Shares |
Rs.100/- each |
Rs.100.000
millions |
|
1200000 |
Cumulative Convertible Preference Shares |
Rs.50/- each |
Rs.60.000
millions |
|
20000000 |
Cumulative Preference Shares |
Rs.100/- each |
Rs.2,000.000
millions |
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TOTAL: |
Rs. 3.360
Millions |
Issued Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
70471411 |
Equity Shares |
Rs.10/- each |
Rs.704.714
millions |
Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
64526089 |
Equity Shares |
Rs.10/- each |
Rs. 645.261
millions |
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Add : |
Amount Paid on
Forfeited Shares |
|
Rs. 10.151
millions |
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Add : |
Share Capital Suspense
|
|
Rs. 0.054 million |
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Add : |
Part cash received against share warrant issued
[to promoters]
|
|
Rs. 28.688 |
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TOTAL: |
Rs. 684.154 millions |
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
684.154 |
655.466 |
655.466 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
5312.145 |
4228.884 |
3752.705 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
5996.299 |
4884.350 |
4408.171 |
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LOAN FUNDS |
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1] Secured Loans |
6024.661 |
4033.957 |
2242.279 |
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2] Unsecured Loans |
13.768 |
233.812 |
135.155 |
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TOTAL BORROWING |
6038.429 |
4267.769 |
2377.434 |
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DEFERRED TAX LIABILITIES |
1080.541 |
1018.036 |
895.905 |
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TOTAL |
13115.269 |
10170.155 |
7681.510 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
8517.363 |
7139.961 |
5008.692 |
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Capital work-in-progress |
2455.001 |
1147.883 |
671.854 |
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INVESTMENT |
960.737 |
984.987 |
1039.920 |
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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 |
1573.018
|
1762.635
|
894.893 |
|
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Sundry Debtors |
1200.665
|
909.562
|
935.869 |
|
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Cash & Bank Balances |
84.275
|
90.792
|
548.881 |
|
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Other Current Assets |
0.000 |
0.000 |
0.000 |
|
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Loans & Advances |
922.807
|
781.962
|
501.461 |
|
Total
Current Assets |
3780.765
|
3544.951 |
2881.104 |
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Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
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Current Liabilities |
2181.380
|
2257.314
|
1670.958 |
|
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Provisions |
417.217
|
390.313
|
249.102 |
|
Total
Current Liabilities |
2598.597
|
2647.627 |
1920.060 |
|
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Net Current Assets |
1182.168
|
897.324 |
961.044 |
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MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
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|
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|
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TOTAL |
13115.269 |
10170.155 |
7681.510 |
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PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
Sales Turnover [including other income] |
13040.115 |
10779.427 |
8432.072 |
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|
|
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Profit/(Loss) Before Tax |
1584.284 |
843.110 |
724.979 |
|
Provision for Taxation |
|
242.591 |
308.872 |
|
Profit/(Loss) After Tax |
1047.724 |
600.519 |
416.107 |
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Export Value |
3288.586 |
1505.792 |
1179.322 |
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Import Value |
4181.535 |
4043.334 |
2038.282 |
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Total Expenditure |
11455.831 |
9936.317 |
7707.093 |
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2006 [1st
Qtr.] |
30.09.2006 (2nd
Qtr.) |
31.12.2006 (3rd
Qtr.) |
|
Sales Turnover |
4572.000 |
4751.200 |
4503.600 |
|
Other Income |
22.600 |
35.300 |
23.500 |
|
Total Income |
4594.600 |
4786.500 |
4527.100 |
|
Total Expenditure |
3139.500 |
3161.600 |
3168.100 |
|
Operating Profit |
1455.100 |
1624.900 |
1359.000 |
|
Interest |
83.600 |
90.500 |
80.600 |
|
Gross Profit |
1371.500 |
1534.400 |
1278.400 |
|
Depreciation |
171.000 |
186.300 |
195.800 |
|
Tax |
318.000 |
384.200 |
323.700 |
|
Reported PAT |
806.500 |
892.200 |
701.100 |
Notes
2006-06
Quarter 1
Gross Sales Includes Sales/ Income from Operations Rs
3621.10 million CERs Transferred Rs 1338.30 million Expenditure Includes (Increase)
/ Decrease in Stock in Trade Rs 84.10 million Consumption of Raw Materials Rs
1969.40 million Staff Cost Rs 162.50 million Power & Fuel Rs 368.70 million
Other Expenditure Rs 554.80 million Tax Includes Provision for Current Tax
(incl Fringe benefit tax) Rs 318.00 million Deferred Tax Rs 76.00 million EPS
is Basic Status of Investor Complaints for the quarter ended June 30, 2006
Complaints Pending at the beginning of the quarter Nil Complaints Received
during the quarter 23 Complaints disposed off during the quarter 23 Complaints
unresolved at the end of the quarter Nil 1. The Board at its meeting held on
June 23, 2006 approved buy back of shares of the Company upto Rs 350.00 million
at price not exceeding Rs 250 per share from open market. Buy-back is open for
the period of 12 months beginning June 23, 2006 or such earlier date as may be
determined by the Board. The process of buy back has begun. 2. The receipt of
CERs (Certified Emission Reduction) income is likely to vary from Quarter to
Quarter and will not recur uniformly over the year. 3. Other Expenditure for
the quarter includes an adverse impact on account of Exchange Currency
Fluctuation amounting to Rs 144.50 million inclusive of Rs 70.10 million on
account of CERs (Corresponding quarter previous year Rs 2.90 million). 4.
Previous year figures have been regrouped/recast/rearranged wherever necessary
to conform to current years classifications. 5. The above results were reviewed
by the Audit Committee and taken on record by the Board of Directors in the
meeting held on July 25 2006.
200609 Quarter 2
Notes:
EPS is Basic 1 The above results were reviewed by the Audlt Committee
and taken on record by the Board of Directors In the meeting held on 24th October
2006. 2 The Auditors of the Company have carried out the limited review of the
above unaudited financial results In terms of clause 41 of the Listing
Agreement. 3 In accordance .with, the SEBI(DIP) guidelines and resolution
passed by the shareholders at their meeting held on 7.4.2005, 33,75,000
warrants having a right to subscribe to equal number of equity shares were
issued and allotted to SRF Polymers Investments Ltd., one of the promoter
company at a price of Rs. 85 per share. 10% (i. e. Rs. 2,86,87,500/-) of the
issue price was received at the time of allotment of warrants and the balance
90% (i.e. Rs. 25,81,87,500/-) was received on 13th October, 2006 on allotment
of equal number of shares. These shares rank pari-passu with the existing
shares of the Company. Post allotment the promoter's shareholding has increased
to 42.42% from 39.41 %. 4 Buy-back of fully paid equity shares announced on
24.6.2006 to the extent or less than Rs. 350 millions at a maximum price not
exceeding Rs. 250/- per share from open market through stock exchange route was
closed on 25.9.2006. An aggregate of 16,084 equity shares at an average price
of Rs.194.29 per share were bought back absorbing a total amount of Rs.
31,24,934. As a result of the buy-back, the paid up capital of the Company was
extinguished to an extent of Rs. 0.161 millions and the general reserves were
reduced by Rs. 2.964 millions. An amount of Rs.0.161 millions was also
transferred to capital redemption reserve. 5 The receipt ofCERs (Certified
Emission Reduction) income is likely to vary and may not recur from Quarter to
Quarter. 6 The Accounting Standard AS-15 (Revised 2005) issued by the ICAI on
employee benefits comes into effect from 1st Apri1, 2006. The Company will
re-assess at the year end, its liability as on 31st March'06 & 31 st
March'07 towards employee benefits covered by the aforesaid Accounting
Standard. However, appropriate provision has been made on estimated basis for
the half year ended September, 2006. 7 There were no Investor complaints
outstanding at the beginning and at the end of the quarter. The company
received 69 complaints during the quarter and all of them were resolved. 8
Previous year figures have been regrouped/recast/rearranged wherever necessary
to conform to current years classifications.
200612 Quarter 3
Notes
EPS is Basic 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 29 Complaints disposed off during the
quarter 29 Complaints unresolved at the end of the quarter Nil 1. The above
results were reviewed by the Audit Committee and taken on record by the Board
of Directors in the meeting held on January 20, 2007. 2. The Authors of the
Company have carried out the Limited Review of the above unaudited financial
results in terms of clause 41 of the Listing Agreement. 3. During the quarter
the Technical Textile Business has commissioned a) Poly and Spinning Plant at
Manali (Chennai) increasing its capacity from 11000 MTPA to 25400 MTPA, and b)
Expanded the capacity of Nylon Tyre Cord Fabric at Gwalior increasing its
capacity from 10000 MTPA To 17000 MTPA. 4. The proceeds of Rs 28,68,75,000/-
from preferential issue has been utilized towards capital expenditure for
expansion. 5. The receipt of CERs (Certified Emission Reduction) income is
likely to vary and may not recur from Quarter to Quarter. 6. The Company is in
the process of assessing its liability towards employee benefits covered by the
Accounting Standard AS-15 (Revised 2005) issued by the ICAI. An appropriate
provision would be made at the year end. Meanwhile an adhoc provision of Rs
3.00 million has been made for the current quarter ended December 31, 2006 in
addition to a provision of Rs 5.00 million till the half year ended September
30, 2006. 7. Previous year figures have been regrouped / recast / rearranged
wherever necessary to conform to current years classifications.
KEY RATIOS
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
Debt-Equity Ratio |
1.07 |
0.82 |
0.71 |
|
Long Term Debt-Equity Ratio |
1.07 |
0.82 |
0.68 |
|
Current Ratio |
0.99 |
0.99 |
1.02 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
1.15 |
1.13 |
1.04 |
|
Inventory |
8.63 |
8.75 |
9.67 |
|
Debtors |
13.63 |
12.60 |
11.14 |
|
Interest Cover Ratio |
5.03 |
4.29 |
4.04 |
|
Operating Profit Margin (%) |
18.11 |
13.93 |
15.54 |
|
Profit Before Interest And Tax Margin (%) |
13.74 |
9.46 |
10.30 |
|
Cash Profit Margin (%) |
11.65 |
9.63 |
9.68 |
|
Adjusted Net Profit Margin (%) |
7.28 |
5.17 |
4.45 |
|
Return On Capital Employed (%) |
19.85 |
14.96 |
15.87 |
|
Return On Net Worth (%) |
21.80 |
14.91 |
11.73 |
STOCK PRICES
|
Face Value |
Rs.10/- |
|
High |
Rs.152.00/- |
|
Low |
Rs.141.00/- |
LOCAL AGENCY
FURTHER INFORMATION
The company’s Registered Office was shifted
from Express Building, 9 – 10, Bahadur Shah Zafar Marg, New Delhi – 110 002,
India to the present address w.e.f. 1st July, 2006.
HISTORY
Incorporated in 1970 with its plant at Manali and in
Tamilnadu, SRF was promoted by DCM. SRF manufactures nylon tyre cord fabric,
fishnet twine, engineering plastics, etc. Its products include methyl chloride,
methylene chloride, chloroform and carbon tetrachloride.
The company is the 8th largest producer of Nylon Tyre Cord Fabric globally and
is the market leader in India with 36% Domestic Market Share. The Company is
the 2nd Largest Producer in Belting Fabrics Globally and is the market leader
in India with 61% Domestic Market Share. Further the company is the market
leader in India in Refrigerants Gases with 40% market share.
The Subsidiaries of SRF are SRF Overseas Ltd, SRF Americas, Inc., SRF
Transnational Holdings Ltd and SRF Properties Limited. During 2004-05 SRF
Technologies Inc., a wholly owned subsidiary established in US was
dissolved.
SRF's nylon tyre cord plant was set up in collaboration with Chemtex, US, and
Unitika, Japan; its fluorochemicals division was set up in collaboration with
ELF Atochem, France. It diversified into manufacturing opthalmic plastic
lenses, in collaboration with Galic Mans Ventures, US; and chloromethanes. It
set up a plant to manufacture chloromethanes, which was commissioned in
Mar.'95. After enhancing the capacities and acquisitions, greenfield projects
the company has increased the NTCF(Nylon Tyre Cord Fabric) capacity from 9800
MT in 1994-95 to 41000 MT in 2002-03.
In April 1994, SRF came out with a rights issue of 15% FCDs to finance certain
projects and to meet long-term working capital requirements, at a project cost
of Rs 1460 millions. SRF received the R&D award for its success in
developing and commercialising a polyamide dispersion based on
micro-crystalline polymer technology. The company took over Shriram Needle
Bearings in 1988 and in 1994, it amalgamated Flowmore Polyesters, a BIFR
company. SRF acquired the nylon cord division of Ceat, of the RPG group, at a
cost of over Rs 3000 millions in 1995. The industrial fabrics division received
the ISO 9002 certificate and the nylon tyre cord division acquired from Ceat,
received the ISO 9000 certificate.
During 1999-2000, the Company acquired 100% shares of M/s Tyre Cord Fabric Ltd
(formerly Du Pont Fibres Limited.
The court has approved scheme of amalgamation, arrangement and reconstruction
between the company, Tyrecord Fabric Limited, SRF Chemicals Limited and their
respective shareholders. The scheme, envisages amalgamation of Tyrecord Fabric
Limited, a wholly owned subsidiary of the company, with SRF Limited and
de-merger of smaller business comprising of Polyester, Films, Fish Net
Twine/yarns and Engineering Plastics (together constituting approx. 15% of
sales) and transfer of these business to SRF Chemical Limited The company has
set up the IT facility centre at Chennai to foray into BPO and IT enabled
services.
The company has chalked out a new project in speciality chemicals whereby it
will set up two plant at an investment of Rs. 200 millions. The plant is expected
to be commissioned by January, 2004. The two plants will be set up in the
existing Chemicals complex of Jhiwana, Rajasthan.
The 20,500 MT polyester film project will also be commissioned by
September,2004. The cost involved for the polyester film project is estimated
to be Rs. 1600 millions. The company has decided to sell/ divest/ restructure
'SRF Infotel' and is in the process of getting the requisite approval.
The Company has increased the installed capacity of Nylon Tyre Cord Fabric/Industrial
Yarn Fabric, Hydrofluoric Acid(Anhydrous) and Gypsum by 944 MT, 800 MT and 7800
MT respectively during 2004-05. With this expansion the total installed
capacity of Nylon Tyre Cord Fabric/Industrial Yarn Fabric, Hydrofluoric
Acid(Anhydrous) and Gypsum has increased to 39730 MT, 8300 MT and 33300 MT
respectively. Further the company has installed a new capacity of Polyester
Films with a capacity of 25650 MT.
During 2004-05 the company has started the Packaging Films Business by
acquiring a group companies facilities in Kashipur (Uttaranchal) and the
setting up of a new plant in the Indore Special Economic Zone. Further the
company has entered into manufacturing of specialised pharma chemicals at
Bhiwadi in Rajasthan.
The Company is engaged in adding 13300 TPA of fibre capacity at its Gwalior
Plant and has de-bottlenecked dipping facilities at the Manali Plant to add
6000 TPA of dipping capacity. Further the company has planned to add another
7000 TPA of fabric capacity and to set up a new 14600 TPA Nylon-6 fibre plant
at Manali. The company is also setting up a manufacturing facility for HFC-32
and HFC-134a which is expected to be commissioned by 2005-06 and also a
coal-based power generator at its plant in Bhiwadi which is expected to be
commissioned by 2005-06.
During 2005-2006, the companies production capacity of Synthetic
Filament Yarn including Industrial Yarn/Tyre Cord expanded from 21500 MT to
34800 MT.
milestones :
|
1970 |
Incorporation of Shriram Fibres (promoted by DCM Limited) |
|
1974 |
Commissioning of Nylon Tyre Cord fabric plant at Manali |
|
1977 |
Introduction of fishnet twine at Manali |
|
1979 |
Introduction of Nylon engineering plastics at Manali |
|
1983 |
Commissioning of the industrial fabrics plant at Viralimalai for production
of Chafer and Belting fabrics |
|
|
Expansion of Nylon tyre cord capacity at Manali |
|
1985 |
Management takeover of Shriram Bearings Limited and Shriram Needle
Bearing Industries Limited |
|
1986 |
Commencement of Coated Fabrics project at Viralimalai. |
|
|
Commencement of commercial production at SRF Nippondenso Limited |
|
|
Commencement of operations at SRF Finance Limited |
|
1989 |
Commencement of commercial production of Fluorochemicals at Jhiwana |
|
1990 |
Shriram Fibres become SRF Limited |
|
1993 |
Divestment of SRF Nippondenso Limited. |
|
|
Adoption of Total Quality Management |
|
1994 |
Commencement of operations at SRF International |
|
|
Commencement of Halon plant at Jhiwana |
|
|
Takeover of Flowmore Polyester Limited |
|
1995 |
Takeover of Nylon Tyre Cord plant of Ceat |
|
|
Commencement of Vision Care Project at Bangalore |
|
|
Incorporation of SRF Americas |
|
|
Dipping facility commissioned at Manali |
|
|
Backward integration into chloormethanes |
|
1996 |
Commencement of tyre cord fabric production at SRF Overseas plant at
Dubai |
|
1997 |
Divestment of SRF Finance Limited to GE Capital |
|
1998 |
Divestment of Vision Care Division |
|
|
Closure of SRF International Division (Trading Business) |
|
1998 |
DCM divests SRF stake in favour of Mr. Arun Bharat Ram |
|
|
SRF Limited emerges as an independent entity |
|
|
Acquisition of Dupont Fibers Limited, subsequently renamed Tyrecord
Fabric Limited |
|
2000 |
Divestment of Shriram Bearings Limited and Shriram Needle Bearing
Industries Limited |
|
2001 |
Doubling of capacity at Tyrecord Fabric Limited, Gummidipoondi |
|
|
Closure of SRF International (Emeritus) |
|
2002 |
Merger of Tyrecord Fabric Limited with SRF Limited |
|
|
Polyester Films, Fishnet Twine & Engineering Plastic business spun
off as a separate entity, SRF Polymers Limited (Closure of SRF International
(Mauritius) |
|
|
Debottlenecking Chloromethanes to 210% of initial capacity |
|
2003 |
The company emerges as the 5th largest Belting Fabrics
manufacturer in the world. |
The Rs. 9800 millions SRF Group is an Indian market leader in industrial
yarn and fabric as well as refrigerant gases.
Since its inception in 1974, the SRF Group has emerged as an industrial major
in its core business areas, which has about 2500 employees operating out of 14
locations in India, UAE and USA.
In 2001, the company de-merged three small businesses that manufacture
engineering plastics, fishnet twine and polyester films into a separate company
- SRF Polymers Limited.
MANAGEMENT DISCUSSION AND ANALYSIS
2005-06 was yet another year of excellent performance of the Indian
economy. On the back of two consecutive years of high growth — 8.5 per cent in
2003-04 and 7.5 per cent in 2004-05 — the economy is expected to grow at 8.4
per cent in 2005-06. This translates into an unmatched compounded annual growth
rate of over 8 per cent during the last three years, not only in comparison to
India experience overtime, but also across economies of comparable size with
the exception of China.
This growth is even more commendable as it is driven by good performance
across sectors in manufacturing and services and is much more broad-based. As a
result, there has been substantial buoyancy in investments made by businesses
and demand of goods and services from consumers.
SRF was well positioned to benefit from this favourable market situation
with the expansion plans initiated during the previous year starting to bear
fruits in 2005-06. This coupled with the company's commitment to the principles
of Total Quality Management (TQM) for continuous improvements of its business
processes and operational efficiencies, has enabled the company to achieve a
much better performance for the year under report. The highlights of SRF's
financial performance in 2005-06 are:
Net sales from operations increased by 22.5 per cent - from Rs. 10590
millions in 2004-05 to Rs. 12980 millions in 2005-06.
Profit before depreciation, interest and tax rose by 60.9 per cent -
from Rs.1610 millions in 2004-05 to Rs.2590 millions in 2005-06.
Profit before depreciation and tax (PBDT) grew by 62.4 per cent - from
Rs. 1360 millions in 2004-05 to Rs.2210 millions in 2005-06.
Profit after tax (PAT) also increased by 74.5 per cent - from Rs. 600
millions in 2004-05 to Rs. 1050 millions in 2005-06.
Return on capital employed (ROCE) increased from 17.2 per cent in
2004-05 to 23.8 per cent in 2005-06.
Return on net worth (RONW) increased from 14.9 percent in 2004-05 to
21.7 percent in 2005-06.
Earnings per share on a fully diluted basis (EPS diluted) rose by 65.7
per cent from Rs.9.31 in 2004-05 to Rs. 15.43 in 2005-06.
In the remainder of the chapter, they will review the performance of
SRF's business — their market, operations and outlook; initiatives taken by the
company and its overall financial performance in 2005-06.
Businesses
SRF has a portfolio of established businesses in industrial
intermediates. In the last few years, the company has also developed new
businesses in packaging films and pharma chemicals as a part of its long-term
strategy for growth. During the year under report, the company regrouped its
businesses to reflect this change in its portfolio and to position them in line
with the opportunities presented by the global market. The company classified
its main businesses as: Technical Textiles Business (TTB) which includes the
erstwhile Industrial Synthetics Business and Industrial Fabrics Business,
Chemicals Business (CB) which includes Pharma Chemicals in addition to the
earlier Fluoro chemicals Business, and Packaging Films Business (PFB). Chart A
gives the size of SRF's businesses during 2005-06. Receipts of Rs. 940 millions
on account of transfer of CERs (Carbon Emission Reductions) generated in the
Chemicals Business has been shown separately.
Technical Textiles Businesses
Technical textiles business, which is SRF's largest business, comprises
tyre reinforcements, belting fabrics and coated fabrics. Sales of the business
grew by 4 per cent from Rs. 7660 millions in 2004-05 to Rs. 7990 millions in
2005-06. This is the largest business in terms of size and contributes
approximately 62 per cent to the total sales of the company.
Tyre Reinforcement
The main product of the company in this portfolio is nylon tyre cord
fabric (NTCF), which is used as a reinforcement material in ail categories of
tyres. Nylon industrial yarn, which is an intermediate product in the
production of NTCF, is also used in non-tyre application. In developed
economies, over 60 per cent of industrial yarn is consumed for non-tyre
application, whereas in developing economies, non-tyre application accounts for
only 10-15 percent. As the Indian economy matures, usage of industrial yarn in
non-tyre applications will increase. This will provide opportunity to SRF to
diversify its product portfolio.
Chart B gives the demand-supply situation of NTCF in India. Currently,
there is a demand supply gap in the domestic market, which is serviced by
imports. The demand for NTCF has a direct correlation with the growth of the
economy and, therefore, NTCF demand is expected to grow at a healthy rate in
future.
To benefit from this opportunity, the company embarked on a
comprehensive expansion programme for the business. During 2005-06, the company
expanded its yarn capacity at Gwalior by 13,300 tonnes per annum (TPA) and
dipping capacity at Manaii (Chennai) by 6,000 TPA. The textile capacity at
Gwalior is also in the process of being increased by 2,500 TPA. Expansion plans
for fiscal 2006-07 include 14,000 TPA of yarns capacity at Manaii and 4,500 TPA
of textiles capacity at Gwalior. With the completion of these plans, your
company's Nylon 6 tyre cord yarn capacity will increase to more than 40,000 TPA
and fabric capacity, including the overseas plant, will exceed 46,000 TPA. This
would enable the company to become the third largest Nylon 6 tyre cord fabric
producer in the world and at the same time retain its number one position in
the domestic market for NTCF. Keeping in view the importance of innovation in
the future success of this business, the company is also in the process of
establishing a research and development centre with pilot facility of
polymerization, spinning and dipping in 2006-07 which would be used for
development of new products and processes. The facility is expected to improve
profitability of existing operations through process improvements and expansion
of product portfolio through new product development.
Belting Fabrics
Belting Fabrics, which are used as reinforcement material for conveyor
belts, witnessed robust growth in global demand across industries especially
mining, which is a key end-use industry. Indian belt manufacturers have
benefited from this growth both in the domestic and export markets which has
also opened up opportunities for SRF in domestic market.
The company is a market leader in India with a share of over 50 per cent
and is now the third largest manufacturer of Belting Fabrics in the world. It
has a dominating presence in the Asian markets and is emerging as a significant
player in Europe. Over the last few years, SRF has established business with
global belt majors and with 55 per cent of its production being exported; it
has a fairly wide presence across the globe.
SRF is now focusing on developing more value added products, which will
enable the company to widen its product portfolio and make it more attractive
for its customers to expand their business with us.
Coated Fabrics
Coated fabrics are used in a wide range of applications including
protective dynamic tarpaulins, static covers, auto-canopies, signage’s and
awnings. During the year under report, the company focused on rationalizing the
product portfolio.
Given the dynamic nature of the market, the company has now embarked on
a program to develop new products in line with the changing market needs, which
will enable it to diversify its portfolio and build volumes. The primary focus
of this business in terms of target market continues to be India since it is
expected that the number of applications and volumes will increase
significantly with economic development. The company continues to enjoy a
leadership position in the sub-segments in which it operates.
Outlook
The growth prospect for the tyre cord fabric is closely linked to the
development in the tyre industry and with a buoyant economy, the demand for
tyre cord fabric will continue to grow. The bus and truck tyres segment
accounts for 68 per cent of total tyre cord consumption and a possible risk to
the NTCF business comes from radialization of this segment. The current
radialisation level in this segment is only 2 per cent in India. Although
radialisation in this segment is expected to increase with economic growth,
most conservative estimates suggest that domestic demand for NTCF will continue
to grow at least for the next 10 years. This places the company in a good
position to leverage this opportunity. Therefore, SRF does not see
radialisation as a problem in the next 10-12 years; and demand for its products
should continue to grow in the medium-term.
Even so, SRF is exploring opportunities to diversify its technical
textiles business into other product segments to de-risk itself from an
eventual reduction in demand of NTCF. In the belting fabrics business, the
company has already achieved a dominant position in the domestic market and is
in a position to leverage the current upswing in the global demand situation.
Having established a good customer base for fabric supply to belting industry,
the company is looking forward to be able to leverage the opportunities
emerging in this sector to grow the business.
Currently, India has a very low per capita consumption of technical
textiles. As the economy continues to grow at the rate of over 8 per cent, the
company expects India's per capita consumption of technical textiles to grow
several folds in the coming years. The company is actively evaluating
possibilities of entering into new segments in the years to come to
opportunities.
During the year, the performance of the company was affected due to
escalating energy and chemicals cost. There were also time overruns in the
commissioning of the yarn project in Gwalior by almost a quarter. With the
strong demand outlook and measures to improve our cost structures by investing
in more cost-effective sources of energy, the long-term outlook of the business
is encouraging.
Chemicals Business
Chemicals business of the company comprises refrigerants, chloromethane
and newly developed pharma chemicals segments. Sales of the business grew by 19
per cent from Rs. 2140 millions in 2004-05 to Rs. 2560 millions in 2005-06.
This does not include receipts from transfer of CERs (Carbon Emission
Reductions also known as Carbon Credits) worth Rs. 940 millions generated by
the business during the year under report. The company's initiative in this
regard has been discussed in the section on Clean Development Mechanism.
Refrigerant Gases
Refrigerants are primarily used by the air-conditioning and refrigerant industry
as the cooling medium in compressors. Other uses include blowing agent for
insulating foam, propellant in aerosols, metered dose inhalers for
pharmaceutical applications, and feedstock in manufacture of fluoropolymers.
SRF's current refrigerant gas portfolio includes
hydro-chlorofluorocarbons (HCFC-22) and chioroffuorocarbons (CFC-11 and
CFC-12). According to the time-table agreed upon by countries to prevent
depletion of ozone layer under the Montreal Protocol, CFCs and HCFCs will be
phased out completely by 2010 and 2040 respectively and will ultimately be
replaced by hydrofluorocarbons (MFCs) and in certain cases, by hydrocarbons.
Operations Review
Net sales of the company grew by 22.5 per cent from Rs. 10590 millions in
2004-05 to Rs. 12980 millions in 2005-06. Profit before interest, depreciation
and tax (PBIDT), including 'other income' increased from Rs. 1610 millions in
2004-05 to Rs. 2590 millions in 2005-06.
As a result of investments in the ongoing expansion programme, which the company
has financed through a mix of debts and internal accruals, total borrowing
including short term loans increased from Rs. 4270 millions in 2004-05 to Rs.
6040 millions in 2005-06. Consequently, interest and financial charges (net)
increased from Rs. 250 millions in 2004-05 to Rs. 380 millions in
2005-06.
Profit before tax (PBT) increased by 87.9 per cent from Rs. 840 millions in
2004-05 to Rs. 1580 millions in 2005-06. After accounting for the provision on
taxation of Rs. 540 millions, which includes both fringe benefit tax and
deferred tax liability, profit after tax (PAT) grew by 74.5 per cent from Rs.
600 millions in 2004-05 to Rs. 1050 millions in 2005-06.
The company's Clean Development Mechanism (CDM) project 'GHG emission reduction
by thermal oxidation of HFC-23' was approved on 24 December 2005 by the CDM
Executive Board under the United Nations Framework Convention on Climate Change
(UNFCCC). During the year, company transferred 1.4 million certified emission
reductions and realised a sum of Rs. 940 millions. For a detailed discussion on
this initiative, please refer to the Management Discussion and Analysis section
of the annual report.
Subsidiary Companies
SRF Overseas Limited (SRFO)
SRFO, a wholly owned subsidiary operating out of Dubai, is an arm of the
technical textiles business (TTB), targeted at the markets of Middle East,
Europe and Africa. Turnover of the company increased from AED 87.51 million in
2004-05 to AED 91.96 million in 2005-06. The company earned a net profit of AED
0.87 million in 2005-06 as compared to the profit of AED 0.99 million in
2004-05.
There is no permanent diminution in the value of investment by SIZE in SIRED
considering that:
- SRFO has been making profits for the last two years; and
- NPV of future cash flows of SIRED is more than carrying amount of assets as
per audited result as on 31.03.2006
During the year, approval of Reserve Bank of India was obtained by the company
for rescheduling its export obligation in respect of the WoS and waiver of
dividend repatriation commitment.
SRF Americas, Inc. (SRFA)
SRFA, a wholly owned subsidiary, is the marketing arm of the coated fabrics
segment of TTB m USA. Sales have decreased from USD 2.70 million in 2004-05 to
USD 0.15 million in 2005-06. Due to intense price competition in the US market
for PVC coated fabrics, the subsidiary could not function profitably. The
subsidiary incurred a net loss of USD 0.02 million as against the net loss of
USD 0.12 million in 2004-OS. The accumulated losses of the company as on 31
March 2006 are USD 2.71 million.
SRFA has not made any profits since inception and profits are not likely to
accrue in the near future. Therefore, the current business model of SRFA seems
to be unviable and it has been proposed that SRFA be dissolved in accordance
with the US laws and approval of RBI besought to write off SRF's investment of
USD 2.1 million in SRFA and receivables of USD 0.61 million.
Other Subsidiaries
SRF Transnational Holdings Limited incurred a loss of Rs.4.274 millions during
the year 2005-06. This loss was on account of writing off the investments made
by the company.
SRF Properties Limited earned a net profit of Rs. 0.524 million during the year
2005-06.
The Central Government vide its letter No. 47/151/2006-CL-III dated 27 March
2006 has under section 212(8) of the Companies Act, 1956, exempted SIRE from
attaching a copy of balance sheet, profit and loss account, auditor's report
and directors' report of its subsidiary companies and other documents required
to be attached under Section 212(1) of the Act to the balance sheet of the
company.
Fixed Assets:
Free Hold Land, Leasehold Land, Road, Buildings, Plant & Machinery,
Furniture & Fixtures, Office Equipments, Vehicles and Intangible Assets
etc.
Further strong progress at SRF’s CDM project
SRF announces further sales of 2.5 million carbon credits
New contracts include significant sales to two large European Utilities
SRF expects to realize around Rs 2500 millions from the sales contracted
to date in FY 2006-07
SRF accounts for more than 50% of global CER issuances as on date
New Delhi, May 18, 2006: SRF Limited today announced that they have
signed four new contracts for sale of a further 2.5 million carbon credits from
its HFC-23 thermal oxidation CDM project activity. This brings the sales of
carbon credits during this calendar year to 3.9 million carbon credits.
The latest contracts include sales to two new buyers, who are large
European Utilities and to two existing buyers. These contracts have been
finalised at fixed prices. PricewaterhouseCoopers acted as financial adviser to
SRF Limited on the transactions.
The CDM Executive Board under the United Nations Framework Convention on
Climate Change (UNFCCC) approved the issuance of a further 1,984,947 carbon
credits to the project last week. A total of 3.8 million carbon credits have
now been issued to the SRF project, accounting for more than 50% of all carbon
credits issued globally by the CDM Executive Board to date.
The implementation of SRF’s CDM project for the incineration of HFC – 23
by thermal oxidation is well ahead of its planned schedule. The company had
initially planned to receive its first cash flows from the project during the
2006–07 financial year. However, following early commissioning and
registration, it realised around Rs 950 millions during 2005-06 and expects to
book around Rs 2500 millions from the sale of carbon credits contracted so far
for the financial year 2006 – 07. Depending on the carbon markets and SRF’s
fund requirements, the company will decide on further sale of carbon credits,
during the current financial year 2006-07.
Commenting on the recent developments, Mr. Ashish Bharat Ram, President
and Executive Director, said “They are delighted to have concluded contracts
with the two new prestigious buyers. The carbon markets have been very volatile
in recent weeks, but demand for carbon credits from quality projects like they
remains strong. They are very pleased with the prices they have achieved.”
SRF has also taken significant initiatives in relation to the
sustainable development goals of the project and has commenced work in the
field of Natural Resources Management with a well known Non Governmental
Organisation (NGO) in areas near the Project site in Rajasthan. Mr. Roop
Salotra, President and CEO of the SRF Fluorochemicals business, said “They have
made substantial progress in the fields of Health and Education, besides
initiating the NRM project. This project demonstrates what can be achieved
through the CDM, not just in reducing greenhouse gas emissions, but towards
sustainable development more generally.”
About SRF Limited
SRF Limited, a leading industrial group, manufactures Technical
Textiles, Fluorochemicals, Packaging Films and Pharma Chemicals. Commencing
operations in 1974, SRF today operates from eight plant locations in India and
abroad and has attained market leadership position in Nylon Tyre Cord Fabric
(8th largest in the world & approx 32 per cent market share in India),
Belting Fabrics (3rd largest in the world & approx 60 per cent market share
in India) Refrigerant Gases (approx 40 per cent market share in India) and
Chloromethanes. Currently, SRF’s products cater to industrial customers in more
than 55 countries globally. SRF’s relentless focus on TQM techniques has
resulted in the company winning the prestigious Deming Application Prize in
2004 for the erstwhile Industrial Synthetics Business of SRF (now integrated
with Technical Textiles business), the first nylon tyre cord company outside
Japan to be awarded this prize.
SRF’s CDM Project Highlights:
The project was registered by the UNFCCC on December 24, 2005.
The project is expected to achieve up to 3.8 million CER per annum.
SRF has been storing HFC 23 since July 1, 2004.
SRF started the incineration process in late August 2005.
The sustainable development activities under the project have commenced
in the areas of Education and Health. SRF is working with a well known NGO for
the Natural Resources Management initiative.
The project has realised Rs 950 millions in March 2006 through transfer
of 1.4 million CERs
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.44.49 |
|
UK Pound |
1 |
Rs.85.71 |
|
Euro |
1 |
Rs.58.53 |
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 |
5 |
|
--PROFITABILIRY |
1~10 |
5 |
|
--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/normal. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
|