MIRA
INFORM REPORT
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Report Date : |
28.04.2007 |
IDENTIFICATION DETAILS
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Name : |
TAMILNADU NEWSPRINT AND PAPERS LIMITED |
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Registered Office : |
67, |
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Country : |
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Financials (as on) : |
31.03.2006 |
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Date of Incorporation : |
16.04.1979 |
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Com. Reg. No.: |
7799 |
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CIN No.: [Company
Identification No.] |
L22121TN1979PLC007799 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
CHET00028A / CHET06348G |
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PAN No.: [Permanent
Account No.] |
AAACT2935J |
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Legal Form : |
Public limited liability company. The company’s shares are listed on the
Stock Exchanges. |
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Line of Business : |
Manufacturers of Newsprint in Rolls or Sheets-others,
Paper and Duplicating Paper. |
RATING & COMMENTS
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MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
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Maximum Credit Limit : |
USD 20000000 |
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Status : |
Satisfactory |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a well-established and reputed company having satisfactory track.
Directors are reported as experienced and respectable businessmen. Trade
relations are reported as fair. Business is active. Payments are usually
correct and as per commitments. The company can be considered normal for business dealings at usual trade
terms and conditions. |
LOCATIONS
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Registered Office : |
67, |
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Tel. No.: |
91-44-22354415
/ 16 / 18 / 22301094 / 95 / 96 / 97 /98 / 22350749 |
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Fax No.: |
91-44-2235 0834 / 4614 |
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E-Mail : |
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Website : |
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Administrative Office : |
35, Anna Salai, Guindy, Chennai - 600 032, Tamilnadu |
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Factory 1 : |
Kagithapuram - 639 136, Karur District, Tamil Nadu |
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Tel. No.: |
91-4324-277001 to 277017 |
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Fax No.: |
91-4324-277025 / 26 / 27 |
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Regional Offices: |
Located at : ·
Mumbai, ·
·
Kolkata, ·
Ernakulam, Kerala ·
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Wind Farm : |
Situated at :- Tirunelveli District, Tamilnadu |
DIRECTORS
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Name : |
Mr. Thiru Shaktikanta Das, I.A.S. |
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Designation : |
Chairman |
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Date of Birth/Age : |
49 Years |
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Qualification : |
M.A |
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Experience : |
26 Years |
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Other Directorship : |
Ø
Titan Industries Ø
Tamil Nadu Petro Products Limited Ø
Tamil Nadu Industrial Guidance & Export
Promotion Bureau Ø
TASCO Ø
Tidel Park Limited Ø
Tamil Nadu Industrial Development Corporation
Limited Ø
Chennai Petroleum Corporation Limited Ø
Southern Petrochemical Industries Corpn. Limited Ø
Neyveli Lignite Corporation Limited Ø
Small Industries Promotion Corporation of Tamil
Nadu Limited Ø
P.S.G.STEP Governing Body |
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Name : |
Mr. Thiru S Ramasundaram, I.A.S. |
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Designation : |
Director |
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Date of Birth/Age : |
52 years |
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Qualification : |
M.Sc. (Chem.), MS (Applied Demography), USC |
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Experience : |
27 years |
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Other Directorship : |
Tamil Nadu Sugar Corporation Limited |
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Name : |
Mr. Thiru V Murthy, I.A.S. |
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Designation : |
Managing Director |
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Date of Birth/Age : |
58 Years |
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Qualification : |
M.A.B.L, H.D.C. |
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Experience : |
36 years |
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Name : |
Mr. Thiru K Gnanadesikan, I.A.S. |
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Designation : |
Director |
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Name : |
Mr. Thiru Sandeep Saxena, I.A.S. |
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Designation : |
Director |
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Date of Birth/Age : |
40 Years |
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Qualification : |
B.E. (Civil), M.Tech, (Water Resources Engg.IITD), MBA(International
Fin.) M.A.(Eco.) |
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Experience : |
17 years |
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Other Directorship : |
Ø
Tamil Nadu Sugar Corporation Limited Ø
Perambalur Sugar Mills Limited |
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Name : |
Mr. Thiru R S Agarwal |
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Designation : |
Director |
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Address : |
A-102, |
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Qualification : |
Retd CGM from IDBI |
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Name : |
Mr. Thiru R R Bhandari |
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Designation : |
Director |
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Address : |
HB-292, Sector 3, Flat No. 8, |
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Qualification : |
B.Sc. Engineering (Mech.) |
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Name : |
Mr. Thiru N Kumaravelu |
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Designation : |
Director |
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Name : |
Mr. Thiru V R Mehta |
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Designation : |
Director |
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Date of Birth/Age : |
72 Years |
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Qualification : |
An Honours degree in Engineering from BITS, Pilani |
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Experience : |
14 Years |
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Other Directorship : |
Ø
Sical Logistics Limited, Chennai Ø
Southern Petrochemical Ø
Industries Corporation Limited, Chennai Ø
Tata Motors Limited, Mumbai Ø
Telco Construction Equipment Ø
Company Limited, Ø
T T Limited, |
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Name : |
Mr. Thiru V Narayanan |
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Designation : |
Director |
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Address : |
Flat No. 19, “The Manor” No. 1, |
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Date of Birth/Age : |
68 years |
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Qualification : |
M.Sc. (Chemistry) |
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Experience : |
45 Years |
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Other Directorship : |
Ø
Ponds Exports Limited : Chairman Ø
M M Fbrgings Limited : Chairman Ø
UCAL Fuel Systems Limited : Director Ø
Bata India Limited : Director Ø
Samtel Color Limited : Director Ø
Glaxo Smithkline : Director Ø
Pharmaceuticals Limited : Director Ø
Samcor Glass Limited : Director Ø
Hindustan Lever Limited : Director Ø
Rane ( Ø
Lafarge India Private Limited : Director Ø
Sundaram Fasteners Limited : Director Ø
FAL Industries Limited : Director Ø
Foster's India Limited : Director Ø
Rane Holdings Limited : Director |
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Name : |
Mr. Thiru G Prabhakara |
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Designation : |
Director |
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Name : |
Mr. Thiru A Velliangiri |
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Designation : |
Director (Finance) |
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Address : |
Agastiyar Manor, Flat No. 1B, 13, |
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Qualification : |
B. Com., FCA, AICWA, FCS, MBA, |
SHAREHOLDING PATTERN
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Names of Shareholders |
No. of Shares |
Percentage of
Holding |
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Promoters |
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- Indian
Promoters |
24444900 |
35.32 % |
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- Foreign
Promoters |
Nil |
Nil |
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Persons acting
in Concert # |
- |
- |
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SUB-TOTAL |
24444900 |
35.32 % |
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NON-PROMOTERS'
HOLDING |
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Institutional
Investors |
- |
- |
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Mutual Funds |
13335596 |
19.27 % |
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Banks, Financial
Institutions, Insurance Companies, Central/State Govt.
Institutions/Non-Government Institutions) |
14205562 |
20.53 % |
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Foreign
Institutional Investors |
2884533 |
4.16 % |
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SUB-TOTAL |
30425691 |
43.96 % |
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OTHERS |
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Private
Corporate Bodies |
3574254 |
5.16 % |
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Indian Public |
9979031 |
14.42 % |
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NRIs/OCBs |
558291 |
0.81 % |
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Others |
228433 |
0.33 % |
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SUB-TOTAL |
14340009 |
20.72 % |
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Total |
69210600 |
100.00
% |
BUSINESS DETAILS
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Line of Business : |
Manufacturers of Newsprint in Rolls or Sheets-others,
Paper and Duplicating Paper. |
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Products : |
Product range including Ø
Business Stationery Ø
Classical Writing Ø
Computer Stationery Ø
News print Ø
Premium Printing Ø
Quality printing |
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Exports : |
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Products : |
Super Printing, Hitech Maplitho, OS 2000 and Newsprint |
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Countries : |
Sri Lanka, Singapore, Malaysia, Philippines, Indonesia,
Myanmar, Muscat, Dubai, Egypt, Jordan, South Africa, Nigeria, Australia, Korea,
UK, Greece and Taiwan |
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Imports : |
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Products : |
Pulp, coal, spares, machinery, etc |
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Countries : |
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Terms : |
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Selling : |
L/C, Cash or Credit (30 days) terms |
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Purchasing : |
L/C, Cash or Credit (30 days) terms |
PRODUCTION STATUS
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Particulars |
Unit |
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Installed
Capacity |
Actual
Production |
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Newsprint/Printing & Writing Paper |
tons |
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230000 |
-- |
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Newsprint |
tons |
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-- |
5468 |
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Printing & Writing Paper |
tons |
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-- |
224611 |
GENERAL INFORMATION
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Customers : |
Wholesalers, End Users and Government Departments Ø
ELCOT New Era Technologies Limited Ø
Tamil Nadu Theatre Corporation
Limited Ø
Tamil Nadu Steels Limited Ø
Salem Co-operative Sugar Mills
Limited, Mohanpur Ø
Jupiter Trading Company Limited,
32-A, K Cyril C Perera Mawatha, Ø
Orient Links Company (L.L.C.), The
Atrium Centre, Office No. 609, Khalid Bin Walid Road, P. O. Box 52708, Dubai,
UAE |
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No. of Employees : |
1777 |
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Bankers : |
Ø
State Bank of Commercial Branch, Ø
Canara Bank Ø
Indian Bank Ø
Indian Overseas Bank Ø
Oriental Bank of Commerce Ø
State Bank of Ø
Syndicate Bank Ø
The Karur Vysya Bank Limited |
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Facilities : |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
Maharaj N.R. Suresh & Company Chartered Accountants |
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Address : |
NewNo.9,OldNo.5,IILane, |
CAPITAL STRUCTURE
Authorised Capital :
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No. of Shares |
Type |
Value |
Amount |
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13,50,00,000 |
Equity Shares |
Rs. 10/- each |
Rs. 1350.000 Millions |
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Issued Capital :
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No. of Shares |
Type |
Value |
Amount |
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7,00,00,000 |
Equity Shares |
Rs. 10/- each |
Rs. 700.000
Millions |
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Subscribed & Paid-up Capital :
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No. of Shares |
Type |
Value |
Amount |
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6,92,10,600 |
Equity Shares |
Rs. 10/- each |
Rs. 692.106
Millions |
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Add : Shares Forfeited |
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Rs. 1.672 Millions |
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Total |
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Rs. 693.778 Millions |
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FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
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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 |
693.778 |
693.599 |
693.600 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
4531.403 |
3960.734 |
3798.800 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
5225.181 |
4654.333 |
4492.400 |
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LOAN FUNDS |
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1] Secured Loans |
2242.892 |
1579.497 |
2276.100 |
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2] Unsecured Loans |
838.446 |
917.775 |
263.800 |
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TOTAL BORROWING |
3081.338 |
2497.272 |
2539.900 |
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DEFERRED TAX LIABILITIES |
1547.600 |
1685.700 |
0.000 |
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TOTAL |
9854.119 |
8837.305 |
7032.300 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
7023.919 |
7178.044 |
7509.500 |
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Capital work-in-progress |
1151.328 |
108.126 |
96.900 |
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INVESTMENT |
11.405 |
11.405 |
81.500 |
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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 |
1215.486
|
1229.950 |
1037.500 |
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Sundry Debtors |
1277.668
|
1181.420 |
893.100 |
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Cash & Bank Balances |
202.149
|
136.038 |
172.900 |
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Other Current Assets |
0.000
|
0.000 |
0.0000 |
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Loans & Advances |
1268.084
|
1306.688 |
1054.400 |
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Total
Current Assets |
3963.387
|
3854.096 |
3157.900 |
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Less : CURRENT
LIABILITIES & PROVISIONS |
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Current Liabilities |
1651.362
|
1881.237 |
3442.500 |
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Provisions |
645.877
|
435.108 |
373.600 |
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Total
Current Liabilities |
2297.239
|
2316.345 |
3816.100 |
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Net Current Assets |
1666.148
|
1537.751 |
(658.200) |
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MISCELLANEOUS EXPENSES |
1.319 |
1.979 |
2.600 |
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TOTAL |
9854.119 |
8837.305 |
7032.300 |
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PROFIT & LOSS
ACCOUNT
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PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
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Sales Turnover |
7756.710 |
6410.602 |
6803.700 |
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Other Income |
257.361 |
271.652 |
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Total Income |
8014.071 |
6682.254 |
6803.700 |
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Profit/(Loss) Before Tax |
1014.736 |
391.695 |
685.700 |
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Provision for Taxation |
209.279 |
12.235 |
157.300 |
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Profit/(Loss) After Tax |
805.457 |
379.460 |
528.400 |
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Earnings in Foreign Currency : |
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Export Earnings |
1175.476 |
1187.438 |
872.383 |
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Total Earnings |
1175.476 |
1187.438 |
872.383 |
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Imports : |
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Raw Materials |
745.117 |
742.359 |
433.887 |
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Stores & Spares |
193.135 |
158.539 |
135.295 |
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Imported coal |
970.929 |
872.094 |
405.269 |
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Capital Goods |
111.953 |
27.844 |
33.911 |
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Total Imports |
2021.134 |
1800.836 |
1008.362 |
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Expenditures : |
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Manufacturing
expenses |
4951.742 |
4444.805 |
1524.900 |
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Personnel
expenses |
516.668 |
535.800 |
0.000 |
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Administration,
selling & other expenses |
652.327 |
528.976 |
719.800 |
|
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Interest and
finance charges |
202.885 |
162.148 |
162.500 |
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Depreciation/amortisation |
624.964 |
618.830 |
601.500 |
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Raw Materials
|
0.000 |
0.000 |
741.000 |
|
|
Excise Duty
|
0.000 |
0.000 |
488.900 |
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Power and Fuel Cost
|
0.000 |
0.000 |
1287.300 |
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Employees Cost
|
0.000 |
0.000 |
469.100 |
|
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Miscellaneous Expenses
|
0.000 |
0.000 |
123.000 |
|
Total Expenditure |
6948.586 |
6290.559 |
6118.000 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2006 |
30.09.2006 |
31.12.2006 |
|
Type |
1st
Qtr |
2nd
Qtr |
3rd
Qtr |
|
Sales
Turnover |
1793.200 |
2354.500 |
2144.500 |
|
Other
Income |
43.800 |
58.100 |
75.900 |
|
Total
Income |
1837.000 |
2412.600 |
2220.400 |
|
Total
Expenditure |
1357.100 |
1861.100 |
1706.500 |
|
Operating
Profit |
479.900 |
551.500 |
513.900 |
|
Interest |
53.200 |
56.000 |
41.100 |
|
Gross
Profit |
426.700 |
495.500 |
472.800 |
|
Depreciation |
158.000 |
160.900 |
162.200 |
|
Tax |
82.300 |
103.400 |
105.100 |
|
Reported
PAT |
188.100 |
232.300 |
223.000 |
200606 Quarter 1 –
EPS is Basic Status of Investor Complaints for the quarter ended
June, 2006 Complaints Pending at the beginning of the quarter Nil Complaints
Received during the quarter 25 Complaints disposed off during the quarter 25
Complaints unresolved at the end of the quarter Nil 1. The above results for
the quarter ended June 30, 2006, which are subject to a 'Limited Review' by the
auditors of the company have been reviewed by the Audit Committee and taken on
record by the Board of Directors in their respective meetings held on July 20,
2006. Wherever necessary, previous year figures have been regrouped to conform
to current year's classification, 2. The impact of changes in exchange rates
pertaining to foreign currency assets/liabilities outstanding as on June 30,
2006 except those covered by forward contracts, has not been considered. The
same will be considered on the date of settlement or at the year end, whichever
is earlier. In case such items are revalued based on the closing exchange rate
on, June 30, 2006, the net profit would have been lower by Rs 11.20 million. 3.
Energy is treated as a reportable segment from the current quarter.
200609 Quarter 2 –
Expenditure Includes (Increase) / Decrease in Stock in Trade
Rs 68.20 million (Increase)/Decrease in stock of Raw materials Rs 107.60
million Raw Material & Chemicals Rs 621.40 million Power, Fuel & Water
Charges Rs 468.30 million Personnel Expenses Rs 156.00 million Repairs &
Maintenance Rs 142.10 million Other Expenditure Rs 297.50 million Tax includes
Provision for Current Tax Rs 102.30 million Deferred Tax Rs (1.10) million
Fringe Benefit Tax Rs 1.10 million EPS is Basic 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 22 Complaints disposed
off during the quarter 22 Complaints unresolved at the end of the quarter Nil
1. The above results for the quarter ended September 30, 2006, which are
subject to a Limited Review by the auditors of the company have been reviewed
by the Audit Committee and taken on record by the Board of Directors in their
respective meetings held on October 12, 2006. Wherever necessary, previous
year's figures have been regrouped to conform to current year's classification.
2. The Board of Directors have declared interim dividend of 15% and fixed the
record date for payment of interim dividend as 27th Oct 2006. 3. The impact of
changes in exchange rates pertaining to foreign currency assets liabilities
outstanding as on September 30, 2006, except those covered by forward
contracts, has not been considered. The same will be considered on the date of
settlement or at the year end, whichever is earlier. In case such items are
revalued based on the closing exchange rate on September 30, 2006, the net
profit would have been lower by Rs 0.115 million. 4. Energy is treated as a
reportable segment from the current year. 5. Effective from April 01, 2006, the
ICAI has issued revised AS-15(R) on Employee benefits the Company is in the
process of ascertaining the impact of said revised AS-15 and the necessary
provision in respect of additional liability if any, will be made at the year
end.
200612 Quarter 3 –
Expenditure Includes (Increase) / Decrease in Stock in Trade
Rs 67.00 million (Increase)/Decrease in stock of Raw materials Rs 19.30 million
Raw Material & Chemicals Rs 601.80 million Power, Fuel & Water Charges
Rs 454.60 million Personnel Expenses Rs 163.80 million Repairs &
Maintenance Rs 145.50 million Other Expenditure Rs 254.50 million Tax includes
Provision for Current Tax Rs 103.90 million Deferred Tax Rs (17.50) million
Fringe Benefit Tax Rs 1.20 million 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 16 Complaints disposed
off during the quarter 16 Complaints unresolved at the end of the quarter Nil
1. The above results for the quarter ended December 31, 2006, which are subject
to a Limited Review by the auditors of the company have been reviewed by the
Audit Committee and taken on record by the Board of Directors in their
respective meetings held on January 23, 2007. Wherever necessary, previous
year's figures have been regrouped to conform to current year's classification.
2. The impact of changes in exchange rates pertaining to foreign currency
assets / liabilities outstanding as on December 31, 2006, except those covered
by forward contracts, has not been considered. The same will be considered on
the date of settlement or at the year end, whichever is earlier. In case such
items are revalued based on the closing exchange rate on December 31, 2006, the
net profit would have been lower by Rs 0.40 million. 3. Energy is treated as a
reportable segment from the current year. 4. Effective from April 01, 2006, the
ICAI has issued revised AS-15(R) on Employee benefits. The Company is in the
process of ascertaining the impact of said revised AS-15 and the necessary
provision in respect of additional liability if any, will be made at the year
end.
KEY RATIOS
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
Debt-Equity
Ratio |
0.56 |
0.55 |
0.67 |
|
Long
Term Debt-Equity Ratio |
0.32 |
0.36 |
0.53 |
|
Current
Ratio |
0.76 |
0.73 |
0.71 |
|
TURNOVER
RATIOS |
|
|
|
|
Fixed
Assets |
0.62 |
0.53 |
0.48 |
|
Inventory |
7.16 |
6.40 |
6.29 |
|
Debtors |
7.12 |
7.00 |
6.88 |
|
Interest
Cover Ratio |
6.00 |
3.42 |
5.22 |
|
Operating
Profit Margin(%) |
21.33 |
16.16 |
22.92 |
|
Profit
Before Interest And Tax Margin(%) |
13.91 |
7.63 |
13.41 |
|
Cash
Profit Margin(%) |
16.62 |
13.76 |
17.86 |
|
Adjusted
Net Profit Margin(%) |
9.20 |
5.23 |
8.35 |
|
Return
On Capital Employed(%) |
15.76 |
7.81 |
11.83 |
|
Return
On Net Worth(%) |
16.31 |
8.30 |
12.27 |
STOCK PRICES
|
Face Value |
Rs.10.00/- |
|
High |
Rs.90.00/- |
|
Low |
Rs.87.05/- |
LOCAL AGENCY FURTHER INFORMATION
FIXED ASSETS
Tangible Assets
Ø
Land
Ø
Buildings
Ø
Railway Sidings
Ø
Plant & Machinery
Ø
On Free
Ø
On
Ø
Furniture, Fixtures & Other Equipments
Ø
Vehicles
Intangible Assets
Ø
Computer Software
HISTORY
Tamilnadu Newsprint and Papers (TNPL) was promoted by the
Government of Tamilnadu for manufacturing newsprint and printing and writing
paper using bagasse as the chief raw material at its plant in Pugalur, Karur
district, with technical assistance from Beloit Corporation Research Centre,
US.
TNPL was incorporated in Apr.'79, with an installed capacity to manufacture
50,000 tpa of newsprint and 40,000 tpa of printing and writing paper.
Commercial production commenced in 1985.
It undertook an expansion programme to double its capacity from 90,000 tpa to
1,80,000 tpa. The expanded production commenced operations in Jan.'96. The
project was funded by a World Bank loan of US $ 75 mln (Rs 2630 Millions),
internal generation of Rs 750 Millions and term loans of around Rs 800 Millions
For this major expansion, TNPL also went public in Nov.'95 at a premium of Rs
100 per share, aggregating Rs 2200 Millions. Its products are exported to
During 1998-99, the company signed an MOU with
The Company was honoured with the 'Mother Teresa Award' for the best corporate
citizen for the year 1999 for its outstanding social commitment, exploring
eco-friendly technology, professional management and customer friendly and
community caring enterprise. It was also awarded the 'Paper Mill of the year
2001-02' by IPMA.
TNPL has increased the capacity to 0.23 Millions tonnes through the rebuild of the
paper machines. These upgradation plans which were chalked out during 2002 was
completed successfully in 2003 at a cost of Rs.1400 Millions. The company hopes
to hit the bottomline of Rs.1000 Millions in 2003-04. TNPL is also having
potentital of expanding its capacity to 3.5 lakh tonne in its Pugalur plant. It
is also open to acquisition. During 2000-2001, the Company increased its wind
farm capacity from 15 MW to 18 MW, by installing 4 nos of 750 KW wind turbines
at Devarkulam at a cost of Rs 100.700 Millions.
During 2004-05 the company has taken up The Mill Development Plan (MDP) for
implementation at a capital outlay of Rs.5650 Millions. Under MDP the company
has proposed to replace the existing old hardwood pulp line with a new
state-of-art 300 tpd hardwood pulp line with ECF bleaching, recovery boiler and
other facilites. This project is expected to be completed by November
2006.
During 2005-2006, the company set up a Bio-methanation plant for generating
methane gas (bio-gas) around 15000 M3 per day from bagasse wash water. The
company also increased the wind farm capacity from 21.75 MW to 28 MW by
installing 5 Nos of 1250 KW wind energy generators at Devarkulam during
February 2006.
The companies production capacity of Newsprint/Printing & Writing Paper
stood at 230000 TPA during the year 2005-2006.
OVERALL PERFORMANCE
The company has achieved an overall capacity utilization of
100% against 85.47% in the previous year. The production was higher by 33,838
MT over the previous year.
The production mix of newsprint and printing & writing paper was 2:98
against 4:96 in the previous year. The company's strategy of keeping the
production mix flexible between newsprint and printing & writing paper has
improved the sales revenue and the profit.
During the year, the company has exported 38,645 MT of printing & writing
paper against 41,264 MT in the previous year. The company has sold the entire
production and achieved zero stock of finished goods as on 31.3.2006. This is
the 15th year in which the company has achieved 'zero stock' of finished goods
at the end of the financial year. This is a unique record in the Paper
Industry.
In-house hardwood pulp production reached a new peak of 41,907 MT registering
an improvement of 3644 MT over the previous year. This is the sixth year in
which the company has increased the hardwood pulp production in a row. The
company has produced 4280.18 lakh units of power during the year against
3810.56 lakh units in the previous year. Of this, 831.38 lakh units were
exported to the State grid. During the year, the company has drawn only 14.76
lakh units of power from the State grid, equivalent to 0.43% of the total
consumption. This has enabled the company to control the cost on the energy
front.
Consequent on the good monsoon and increased sugar cane production, bagasse
supplies have increased and the bagasse stock as on 31.03.2006 swelled to
315000 MT. With the abundant availability of bagasse, the company has stopped
procuring bagasse from distant sources to keep the cost low. There was no water
shortage during the year. The company has maintained water conservation
measures and kept the water consumption at 104 KL per MT of finished
production.
The company set up a novel bio-methanation plant for generating methane gas
(bio-gas) around 15000M3 per day from bagasse wash water. The bio-gas is used
as fuel in the lime-kiln replacing usage of furnace oil around 10 KL per day.
The company has registered the project under Clean Development Mechanism (CDM)
with UNFCCC and has obtained 82955 CERs (Certified Emission Reduction) for the
period from 1.8.2003 to 31.12.2005. In addition, the company will be generating
about 37000 CERs per annum upto 31St July 2013. The company's bio-methanation
plant is the country's first ever CDM Project in the waste management sector,
to be registered with the UNFCCC and the first CDM Project from the Indian
Paper Industry.
MARKET TRENDS
Newsprint is in an uptrend right from March 2003. The imported newsprint price
has increased from USD 590 per MT during January - March 2005 to USD 670 per MT
during January-March 2006 and to USD 700 per MT for supplies during April-June
2006. Correspondingly, the newsprint price in the domestic market has also
increased from Rs. 26,250 per MT during January-March 2005 to Rs. 30,250 per MT
during January-March 2006 and to Rs. 31,500 per MT for supplies during
April-June 2006.
Printing & Writing Paper market was stable throughout the year. To
neutralize partly the cumulative adverse impact of the cost increase, printing
& writing paper prices were increased in the domestic as well as export
sales.
Pulp price in the International market was stable during the year, price
ranging from USD 486 to USD 540 per MT in the case of soft wood pulp and USD
482 to USD 513 in the case of hardwood pulp. However, imported softwood pulp
price has increased to USD 650 per MT and hardwood pulp USD 570 per MT since
April 2006.
To overcome the competition from 'B' Grade Mills, and to improve the sales
realization, the company has increased the production of value added products
viz. TNPL Copier, Ultrawhite Maplitho, Hi-tech Maplitho, Offset Printing and
TNPL Elegant Printing from 78368 Mts. in 2004-05 to 105259 Mts. in
2005-06.
During the year, the Government of India has reduced the export incentive for
printing & writing paper from 9% to 7% for Sheets & Cut size papers
with effect from 26.05.2005 and from 4% to 3% for Reels with effect from
14.9.2004. During the year, the company has exported 38,645 MT of PWP to 22
countries.
OUTLOOK
The domestic consumption of Newsprint is expected to grow by 5% per annum and
printing & writing paper by 6% per annum. The pulp price in the
international market has firmed up from April 2006. However, paper price in the
international market has increased only marginally. With the steep increase in
the pulp prices, the paper prices in the international market may rise in the
near term.
The market for surface sized paper is expected to grow by 8% and Copier paper
by 15% per annum. With the installation of the state of the art Size Press in
PM-I, Copier production has been increased from 19311 MT in 2003-04
to 28,141 MT in 2004-05 and 37,645 MT in 2005-06 registering a growth of 46% in
2004-05 and 34% in 2005-06. The company has set a target of 42,000 MT of Copier
production for the year 2006-07.
The newsprint market is also showing a positive trend. The newsprint price in
the international market has increased to USD 700 per MT during April - June
2006. The price is expected to remain firm during the current year.
In the Union Budget 2006-07, the Government has reduced the excise duty on
printing & writing paper from 16% to 12% effective from 1.3.2006. Import
duty on printing & writing paper has been reduced from 15% to 12.5% with
effect from 1.3.2006. Import duty on newsprint is retained at 5%. Cenvatable
countervailing duty of 4% introduced in the Union Budget 2006-07 is applicable
for printing & writing paper. Newsprint is exempted from the levy of
countervailing duty.
HIGHLIGHTS OF THE YEAR
- Achieved highest production of 2,30,079 MT and highest sales of 230079 MT
Production during the year was higher by 33,838 MT over the previous year.
Sales during the year was higher by 28792 MT compared to the previous year.
- Achieved highest production of 37,645 MT of TNPL Copier Paper against 28,141
MT in the previous year registering a growth of 34%.
- Achieved highest Hardwood Pulp production of 41,907 MT against 38,263 MT in
the previous year. This is the sixth consecutive year in which the company has
increased the Hardwood Pulp production.
- Exported 38,645 MT of Printing & Writing Paper during the year valuing
Rs. 1175.500 Millions on FOB basis. This is the highest export of wood free
uncoated printing & writing paper from
- Introduced a new product, namely, 'TNPL Copy Crown' for Inkjet and laser
printers.
- Implemented Farm Forestry Scheme in 6054 acres benefiting 1466 farmers in
nine districts and Captive Plantation in 188 acres. Total area covered under
Farm Forestry Scheme and Captive Plantation during the year is 6242 acres
against 3076 acres in the previous year. It is proposed to implement the Farm
Forestry Scheme and Captive Plantation in about 10000 acres during 2006-07.
- Achieved Zero Stock of finished goods (NP & PWP) at the end of the
financial year. This is the 15t' year in which the company has achieved Zero
Stock (NP & PWP) at the end of the financial year.
- Received the Special Export Award from CAPEXIL for the seventh consecutive
year in recognition of the outstanding export performance.
- The Mill Development Plan has been taken up for implementation at a capital
outlay of Rs.5650 Millions. The project will be implemented before
31.3.2007.
- Processed 16,70,636 M3 of Black liquor in energy efficient
falling film evaporator, against 14,62,850 M3 in the previous year.
- Registered the Bio-Methanation project with United Nations Framework
Convention Climate Change (UNFCCC) as the country's first CDM Project in the
waste management sector. The project generates about 37,000 CERs per annum.
82955 CERs have been received from UNFCCC for the period from 1.8.2003 to
31.12.2005.
WIND FARM
The company has increased the wind farm capacity from 21.75 MW to 28 MW by
installing 5 Nos. of 1250 KW wind energy generators at Devarkulam during
February 2006. During the year under review, the company has generated 309.31
lakh units of wind power against 348.86 lakh units in the previous year. The
wind farm, has earned a profit of Rs.17.71 lakhs during the year.
EXPORTS
The company has exported 38,645 MT of woodfree uncoated printing & writing
paper valuing Rs. 1284.400 Millions (C & F) during the year 2005-06. The
company has set a target of 42000 MT for exports during 2006-07.
MANAGEMENT DISCUSSION AND ANALYSIS
INDUSTRY SCENARIO
The Indian Paper Industry ranks 1511 among the global producers. The industry
is fragmented with over 600 units. Capacity is ranging from 3 tpd to 700 tpd.
Total production capacity is 7.82 million tonnes. Actual production is 5.94
million tonnes. Consumption 6.378 million tonnes. 12 top players with a
capacity of over 0.1 Millions tonnes per annum account for a production of 2
million tonnes equivalent to 1/3,d of the total production. Indian average per
capita paper consumption is 6 kg. against the Asian average of 45 kg. and world
average of 54 kg. The economic growth and the increase in the literacy rate are
expected to increase the per capita consumption to 8-9 kg. by 2010 and 11-12
kg. by 2015.
The compounded average growth rate in the last three years is 5.47%. The
current growth rate is estimated at 5% for NP and 6% for PWP. Within PWP,
non-surface sized papers are expected to grow at 3-4%, Surface sized paper at
6-8% and copier at 15%. Raw material shortage, high capital outlay, strict
environmental regulations are the major entry barriers for the industry.
Because of the entry barriers, only very few
The industry is open to competition from the global players. Imports are freely
allowed. In the Union Budget 2006-07, the import duty on paper has been reduced
from 15% to 12.5% with effect from 1.3.2006. Countervailing duty of 4%
introduced with effect from 1.3.2006 is levied on PWP Import duty on newsprint
is retained at 5%. Countervailing duty is not levied on newsprint imports. IPMA
member mills have exported around 0.2 Millions mts. during 2005-06. Imports
during 2005-06 was 0.9 Millions mts. This includes newsprint imports of 0.7
Millions mts.
STRATEGY
With the increasing competition the manufacturing units are compelled to
upgrade the technology and the scale of operation to supply quality products at
competitive rates. TNPLs strategy in this regard has been to restructure tile
company thoroughly to impart to it the ability to meet the adverse conditions
and evolve as a globally competitive low cost producer. The strategy adopted in
this regard are discussed hereunder:
Technology upgradation
Work continuously on cost reduction
Redesign the financial structure to bring down the interest
costs
Get customer centric
Be an innovative company
Development of Human Resources
The strategy has worked well and facilitated the company to post a healthy
profit during 2005-06.
Technology Upgradation
TNPL expanded the capacity from 90000 tpa to 180000 tpa during 1993-96 by
installing a new Paper Machine. Then enhanced the capacity to 230000 tpa curing
2002-03 through upgradation of Paper Machines. Under the Mill Development Plan
being implemented, the existing hardwood line of 120 tpd will be replaced with
a new 300 tpd hardwood line with ECF bleaching. The existing two Chemical
bagasse bleach lines with a total capacity of 400 tpd will be replaced with a
single line of 500 tpd with ECF bleaching. The paper capacity will be increased
from 230000 tpa to 245000 tpa. The cut pack line capacity will be expanded from
150 tpd to 350 tpd by December 2006 through adding a new Cut Pack line of 200
tpd.
The emphasis on the economies of scale and technology upgradation has
transformed the company into an efficient producer in the global arena.
Work Continuously on Cost Reduction
Companies capable of keeping the cost of production low alone can survive the
increasing competition. Having this in view, TNPL has been working continuously
on cost reduction measures. The focus has been on pulp and energy cost.
Hardwood pulp production was increased from 38263 rats. in 2004-05 to 41907
mts. in 2005-06. This is the sixth year in a row in which the hardwood pulp
production has been increased with the existing facilities. Pulp furnish is
optimized through usage of purchased pulp of different varieties.
Captive power capacity was increased from 36.5 MW to 61.12 MW during 2001-02.
The capacity will be increased to 81.12 MW during 2006-07 by adding a new 20 MW
TG under Mill Development Plan. TNPL will be self-sufficient in power even
after enhancing the pulp & paper capacity under MDP. Surplus power will
continue to be exported to the State grid.
CONTINGENT LIABILITIES
|
Description of
the Contingent Liability |
Estimated Amount
in Millions |
Indication of Uncertainty |
|
|
|
|
|
|
|
Letters of
Credit issued by Banks on behalf of Company |
1510.179 |
Performance or Non-performance of various parties. |
|
|
Guarantees
issued by the Banks on behalf of the Company |
127.830 |
-do- |
|
|
Claims against
the Company not acknowledged as debts relating to Statutory Dues: |
|
All are disputed before concerned appellate authorities. The Company is advised that the cases are likely to be disposed off in favour of
the Company. |
|
|
i) Income Tax |
23.157 |
||
|
ii) Wealth Tax |
1.022 |
||
|
Hi) Customs Duty |
27.121 |
||
|
iv) Excise Duty |
60.483 |
||
|
v) Service Tax |
-- |
||
|
vi) Sales Tax |
-- |
||
|
Claims against
the Company |
|
|
|
|
not acknowledged
as debts - |
|
|
|
|
Others: |
|
|
|
|
i) Corporate |
|
All are disputed
before concerned appellate authorities. The Company is advised that
the cases are likely to be disposed off in favour of the Company. |
|
|
Penal Interest |
2.280 |
||
|
ii) Land
Acquisition Claims |
2.598 |
||
|
iii) Cess on
Land Lease at |
5.531 |
||
|
Perungudi -
Windfarm |
|
||
|
iv) Interest on
Water Royalty |
|
||
|
Paid belatedly |
8.248 |
||
|
v) Others |
36.694 |
||
|
Concession in
Customs Duty availed for imports cleared under Export Promotion on Capital Goods Scheme |
94.676 |
Possibilities of not meeting minimum export quantity requirements by
the Company. |
|
It is in trade terms with :-
Ø
Shanth Chemicals,
Ø
VE1 Industries
Ø
Kamalas Graphics
Ø
J M Voith GmbH,
Ø
Fibro Source USA Inc, 989,
Ø
Elof Hansson Pulp Inc, 565,
Ø
Elof
Ø
Navneet Publications Limited, Navneet
House,
Ø
Tamilnadu Text Book Corporation, 68,
Ø
Pandiyan Paper Company, 59,
Profile
- Promoted by the Government of Tamil Nadu in
1979
- Loan assistance extended by World Bank twice
.
- Largest producer of Bagasse based paper in
the world. Annual consumption of bagasse slated to touch 1 million tonnes per
annum.
- Installed Capacity - 2,30,000 tpa
Vision
To be the market leader in the manufacture of
world class eco-friendly papers, by adopting innovative technologies for
sustainable development.
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No 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.40.90 |
|
|
1 |
Rs.81.29 |
|
Euro |
1 |
Rs.55.47 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
5 |
|
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 |
6 |
|
--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 |
|
59 |
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 |
|