MIRA INFORM
REPORT
|
Report
Date : |
08.05.2007 |
IDENTIFICATION DETAILS
|
Correct
Name : |
DCM SHRIRAM CONSOLIDATED LIMITED |
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Registered
Office : |
6th
Floor, |
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Country
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Financials
(as on) : |
31.03.2006 |
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Date
of Incorporation : |
06.02.1989 |
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CIN
No.: |
L74899DL1989PLC034923 |
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Com.
Reg. No.: |
55-34923 |
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TAN
No.: (Tax
Deduction & Collection Account No.) |
DELD04602D / DELD08433F |
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PAN
No.: (Permanent
Account No.) |
AAACD0097R |
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Legal
Form : |
It is a public limited liability company. The company's shares are listed on the
Stock Exchanges. |
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Line
of Business : |
The company is engaged in manufacturing of Fertilisers,
Urea, Ammonia, Cement, Caustic Soda, Chlorine, HCI, PAC, SBP, Hydrochloric
Acid, Calcium Carbide, PVC Resin, Textile Products, Sugar and Energy
Management Services. |
RATING
& COMMENTS
|
MIRA’s
Rating : |
A |
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
17500000 |
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Status
: |
Good |
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Payment
Behaviour : |
Regular |
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Litigation
: |
Clear |
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Comments
: |
Subject is
a well-established and diversified company having satisfactory track. Directors are reported as experienced,
respectable and resourceful industrialists.
Their trade relations are reported as fair. Financial position is satisfactory. Payments are reported as slow but correct. The company can be considered good for normal business
dealings. |
LOCATIONS
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Registered
Office : |
6th
Floor, |
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Tel.
No.: |
91-11-23316801 / 8069 |
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Fax
No.: |
91-11-23357803
/ 23318072 / 2371 9570 |
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E-Mail
: |
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Website
: |
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Corporate
Office : |
5th
Floor, |
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Tel.
No.: |
91-11-23316801 |
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Fax
No.: |
91-11-23318072 |
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E-Mail
: |
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Factory
1 : |
749, GIDC
Industrial Estate, Jhagadia, Dist. Bharuch - 393110, Tel. No.
91-2645-220355/226021-27 Fax. No.
91-2645-226037 Shriram
Nagar, Tel. No.
91-744-2423391-98 Fax. No.
91-744-2423296 A-315,
Road, No. 2, M.I.A., Alwar, Rajasthan Tel. No.
91-144-281915/281916 Village
Ajbapur, P. O. Jungbahadur Gang, Lakhimpur Kheri - 361505, Uttar Pradesh Telefax.
No. 91-5842-222195/225249 F-91, RIICO
Industrial Area, Tonk, Rajasthan Tel. No.
91-1432-243874 Fax. No.
91-1432-243242 |
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Marketing
office.: |
Kirti
Mahal, 19, Tel. No.
91-11-25713442/25722296 Fax. No.
91-11-25768135 Shivaji
Marg, Tel. No.
91-11-25104410/25747836 Fax. No.
91-11-25455362/25739816 5th
Floor, Tel. No.
91-11-23316801-9 Fax. No.
91-11-23318072 Shivaji
Marg, Tel. No.
91-11-25104410/25747836 Fax. No.
91-11-25455362/25739816 |
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Sales
office : |
Located
at : Kirti
Mahal, 19, Tel. No.
91-11-25713442/25722296 Fax. No.
91-11-25768135 Vaswani
Chambers, 3rd Floor, 264/265, Tel. No.
91-22-24303388/24303379/24304922 Fax. No.
91-22-24307954 Crown
Aluminium House, 23, Tel. No.
91-33-22421101 Meco
House, 3rd Floor, 47, Tamilnadu Tel. No.
91-44-28536322 74-Ratlam
Kothi, Tel. No.
91-731-2523181 Fax. No.
91-731-2515281 Model
Housing, 6-3-456/A/1, Panjagutta, Andhra Pradesh Tel. No.
91-40-23356220 Fax. No.
91-40-23356220 Tel. No.
91-141-236778/2372017/2365162 Fax. No.
91-141-2375916 6 South
Model Gram, Tel. No.
91-161-2430740 Tel. No.
91-744-2425278/2420796 Fax. No.
91-744-2425542 A-203,
Saket, Tel. No.
91-121-2647001/2649076 Fax. No.
91-121-2645766 IG-32,
Gagan Path, Jawahar Nagar, Sriganganagar - 335001, Rajasthan Tel. No.
91-154-2460307 Fax. No.
91-154-2460307 |
DIRECTORS
|
Name : |
Mr. Ajay
S. Shriram |
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Designation
: |
Chairman |
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Name : |
Mr.
Vikram S. Shriram |
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Designation
: |
Vice
Chairman & Managing Director |
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Name : |
Mr. Rajiv
Sinha |
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Designation
: |
Deputy
Managing Director |
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Name : |
Mr. Ajit
S. Shriram |
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Designation
: |
Director
(Sugar) |
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Name : |
Dr. S. S.
Baijal |
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Designation
: |
Director |
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Name : |
Mr. Arun
Bharat Ram |
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Designation
: |
Director |
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Name : |
Mr.
Pradeep Dinodia |
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Designation
: |
Director |
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Name : |
Shri Vimal Bhandari |
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Designation
: |
Director |
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Name : |
Shri Sunil Kant Munjal |
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Designation
: |
Director |
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Name : |
Shri D. Sengupta |
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Designation
: |
Director |
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Name : |
Shri O.V. Bundeliu |
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Designation
: |
IDBI Nominee |
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Name : |
Shri S.L Mohan |
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Designation
: |
CIC Nominee |
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Name : |
Shri S. C. Bhargava |
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Designation
: |
LIC Nominee |
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Name : |
Shri V.P. Agarwal |
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Designation
: |
Company Secretary |
MAJOR
SHAREHOLDERS
|
Names of Shareholders |
No. of Shares |
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Individuals/Hindu
Undivided Family |
3862190 |
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Bodies Corporate |
86645930 |
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Public Shareholding |
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Mutal Funds/UTI |
6862796 |
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Financial Institutions/ Banks |
210499 |
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Insurance |
20460238 |
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Foreign Institutional Investors |
6196985 |
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Non Institution |
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Bodies Corporate |
19619274 |
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Individuals |
22045408 |
BUSINESS
DETAILS
|
Line
of Business : |
The company is engaged in manufacturing of Fertilisers,
Urea, Ammonia, Cement, Caustic Soda, Chlorine, HCI, PAC, SBP, Hydrochloric
Acid, Calcium Carbide, PVC Resin, Textile Products, Sugar and Energy
Management Services. |
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Products
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GENERAL
INFORMATION
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No. of
Employees : |
6000 |
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Bankers
: |
Ø Punjab National Bank Ø Bank of Ø Oriental Bank of Commerce Ø State Bank of |
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Facilities : |
-- |
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Banking Relations : |
Satisfactory |
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Auditors
: |
A. F.
Ferguson & Company Chartered Accountants |
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Subsidiaries
: |
Ø
DCM Shriram Credit & Investment Limited Ø
DCM Shriram Aqua Foods Limited Ø
Ghaghara Sugar Limited Ø
DCM Shriram International Limited Ø Trireme Poly Tech Limited
(Formerly known as DCM Shriram Exports Limited) |
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MEMBERSHIPS:
|
Ø
Confederation of Indian Industry |
CAPITAL
STRUCTURE
Authorised
Capital :
|
No. of
Shares |
Type |
Value |
Amount |
|
49990000 |
Equity
shares |
Rs. 10 each |
Rs. 499.900 millions |
|
6501000 |
Cumulative
Redeemable Preference shares |
Rs. 100 each |
Rs. 650.100 millions |
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|
Rs. 1150.000 millions |
Issued,
Subscribed & Paid-up Capital :
|
No. of
Shares |
Type |
Value |
Amount |
|
33340000 |
Equity
shares |
Rs. 10 each |
Rs. 333.400 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 |
333.400 |
167.500 |
167.500 |
|
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2] Share
Application Money |
0.000 |
0.000 |
0.000 |
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3]
Reserves & Surplus |
4880.200 |
4254.900 |
3535.600 |
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4] (Accumulated
Losses) |
0.000 |
0.000 |
0.000 |
|
NETWORTH
|
5213.600 |
4422.400 |
3703.100 |
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LOAN
FUNDS |
|
|
|
|
|
1]
Secured Loans |
7436.100 |
4680.600 |
3484.400 |
|
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2]
Unsecured Loans |
3232.800 |
2265.100 |
1101.800 |
|
TOTAL
BORROWING
|
10668.900 |
6945.700 |
4586.200 |
|
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DEFERRED
TAX LIABILITIES |
0.000 |
961.600 |
1108.800 |
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TOTAL
|
15882.500 |
12329.700 |
9398.100 |
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APPLICATION OF FUNDS
|
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FIXED ASSETS [Net Block]
|
10048.900 |
6879.400 |
5418.700 |
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Capital work-in-progress
|
2374.800 |
1517.600 |
708.600 |
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INVESTMENT
|
344.900 |
563.700 |
741.100 |
|
DEFERREX TAX ASSETS
|
NA |
8397 |
6127.3 |
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CURRENT ASSETS, LOANS & ADVANCES
|
|
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|
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Inventories
|
4405.800
|
3040.000 |
2054.700 |
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Sundry Debtors
|
4169.700
|
3036.100 |
1825.100 |
|
|
Cash & Bank Balances
|
325.900
|
255.000 |
421.300 |
|
|
Other Current Assets
|
0.000
|
0.000 |
0.000 |
|
|
Loans & Advances
|
1591.400
|
966.100 |
905.700 |
Total Current Assets
|
10492.800
|
7297.200 |
5206.800 |
|
Less : CURRENT LIABILITIES & PROVISIONS
|
|
|
|
|
|
|
Current Liabilities
|
6793.600
|
3371.100 |
2346.200 |
|
|
Provisions
|
585.300
|
557.100 |
330.900 |
Total Current Liabilities
|
7378.900
|
3928.200 |
2677.100 |
|
Net
Current Assets
|
3113.900
|
3369.000 |
2529.700 |
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES
|
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
TOTAL
|
15882.500 |
12329.700 |
9398.100 |
|
PROFIT & LOSS ACCOUNT
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
Sales Turnover [including other income]
|
26242.100 |
18094.500 |
14120.300 |
|
|
|
|
|
Profit/(Loss) Before Tax
|
1651.000 |
1099.400 |
1029.800 |
Provision for Taxation
|
499.100 |
55.100 |
263.000 |
Profit/(Loss) After Tax
|
1151.900 |
1044.300 |
766.800 |
|
|
|
|
|
Export Value
|
NA |
1.400 |
0.100 |
|
|
|
|
|
Import Value
|
NA |
584.600 |
148.600 |
|
|
|
|
|
Total Expenditure
|
26243.800 |
15823.500 |
12173.800 |
QUARTERLY
RESULTS
|
PARTICULARS |
30.06.2006 (1st Quarter) |
30.09.2006 (2nd Quarter) |
31.12.2006 (3rd Quarter) |
|
Sales Turnover |
6805.200 |
6663.600 |
8002.700 |
|
Other Income |
86.000 |
95.300 |
88.500 |
|
Total Income |
6891.200 |
6758.900 |
8091.200 |
|
Total Expenditure |
6077.100 |
6204.700 |
7404.700 |
|
Operating Profit |
814.100 |
554.200 |
686.500 |
|
Interest |
187.400 |
194.100 |
205.900 |
|
Gross Profit |
626.700 |
360.100 |
480.600 |
|
Depreciation |
202.600 |
203.700 |
229.200 |
|
Tax |
122.700 |
48.300 |
54.600 |
|
Reported PAT |
301.400 |
108.100 |
196.800 |
200606 Quarter 1
Notes
Gross Sales Includes Own Products Rs 5373.00 million Traded Products
Rs 1831.20 million Expenditure Includes Increase/Decrease in stock in Trade -
Own Products Rs 701.00 million - Traded Products Rs (3.50)million Consumption
of Raw Material Rs 1952.40 million Purchases and related cost - Traded Products
Rs 1818.00 million Power & Fuel Rs 802.10 million Personnel Cost Rs 332.50
million Other Expenditure Rs 543.70 million Sugar Off-Season expenses Rs
(69.10)million EPS is Basic and Diluted 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 90 Complaints disposed off during
the quarter 90 Complaints unresolved at the end of the quarter Nl 1. In view of
the seasonal nature of the sugar industry, the Company for the purposes of
interim results has accounted for off season expenditure on 'Integral approach'
basis instead of 'Discrete approach' basis hitherto followed. Accordingly, the
off season expenditure aggregating Rs 69.10 million has been deferred to be
included in the cost of sugar to be produced in remaining part of the year. As
a result of this, profit after tax for the quarter is higher by Rs 38.60
million. This change will have no effect on the annual results. 2. In view of
Accounting Standard (AS) 15 (revised 2005) 'Employee Benefits', issued by The
Institute of Chartered Accountants of India which is applicable w.e.f. April
01, 2006, personnel cost for the quarter ended June 30, 2006 includes
additional provision for employee benefits of Rs 1.20 million. The
corresponding figure for the quarter ended June 30, 2005 has not been re-casted
as the accumulated liability of employee benefits (including liability for
compensated absences, presently actuarially determined on a discounted basis)
amounting to Rs 100.40 million (net of tax) upto March 31, 2006 will be
adjusted from surplus in profit and loss account in accordance with the
Accounting Standard. 3. Pursuant to notification of the final rates of
concession on phosphatic and potassic fertilisers for the period July 01, 2005
to March 31, 2006 issued by the Government of India, Ministry of Chemicals and
Fertilisers vide its notification dated June 13, 2006, the Company has reversed
revenue credits aggregating Rs 45.20 million accrued in the previous year. 4. Provision
for taxation is made based on the best estimate of weighted average annual
income - tax rate. 5. Previous period figures have been recast, wherever
necessary. 6. The above results were approved and taken on record by the Board
of Directors in their meeting held on July 25, 2006. Limited Review 7. The
Limited Review, as required under Clause 41 of the Listing Agreement has been
completed by the Statutory Auditors. The Limited Review Report for the quarter
ended June 30, 2006, does not have any impact on the above Results and Notes in
aggregate except in respect of matter explained in note 1.
200609 Quarter 2
NOTES :
1. The Board of Directors has declared Interim Dividend of
20% (last year - 20%) amounting to Rs. 66.400 millions to equity shareholders
of the Company. 2. In order to enable use of LNG as a feedstock in place of
naphtha, the Company carried out major modifications in its Fertliser plant
necessitating shut down of plant for 45 days during which the Company also
carried out overhauling jobs undertaken every two years. Consequently, the
Fertliser plant operated only for 47 days during the quarter resulting in
adverse effect on the Turnover and Results of the Fertliser segment. However,
this loss of Turnover and Profits would be largely recovered in the subsequent
quarters of the financial year ending March 31, 2007. 3. In view of the
seasonal nature of the sugar industry, the Company for the purposes of interim
results has accounted for off season expenditure on 'Integral approach' basis instead
of 'Discrete approach' basis hitherto followed Accordingly, the off season
expenditure aggregating Rs. 90.800 millions and Rs. 159.900 millions for
quarter and half year ended September 30, 2006 respectively has been deferred
to be included in the cost of sugar to be produced in remaining part of the
year. As a result of this, profit after tax for the quarter and half year is
higher by Rs. 76.500 millions and Rs. 115.100 millions respectively. This
change will have no effect on the annual results. 4. Provision for taxation is
made based on the best estimate of weighted average annual income - tax rate.
5. Previous period figures have been recast, wherever necessary. 6. During the
quarter, 103 Investor complaints were received, which have all been attended
to. No complaints were pending at the beginning or at the end of the quarter.
7. The above results were approved and taken on record by the Board of
Directors in their meeting held on October 25,2006. Limited Review The Limited
Review, as required under Clause 41 of the Listing Agreement has been completed
by the Statutory Auditors. The Limited Review Report for the quarter ended
September 30, 2006, does not have any impact on the above Results and Notes in
aggregate except in respect of matter explained in note 3
200612 Quarter 3
Notes 1.
Company's new Sugar factories at Hariawan and Loniat Uttar
Pradesh started canecrushing and are under stabilization. The capacity
expansion of 3000 T CD at Ajbapur started commercial production in December
2006. 2. The Board has approved plans for expansion of Caustic Soda Production
Capacity from 68,000 TPA to 1,22,000 TPA and setting up of 48 MW coal based
Power Plant in replacement of 24 MW Furnace Oil based Power Plant at its Unit
at Bharuch, Gujarat. 3. During the quarter, Anant Thermal Energy Limited and
Shriram Bioseed (
KEY
RATIOS
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
Debt
Equity Ratio |
1.83 |
1.42 |
1.27 |
|
Long Term
Debt Equity Ratio |
1.29 |
1.05 |
0.99 |
|
Current
Ratio |
1.02 |
1.06 |
1.11 |
|
TURNOVER
RATIOS |
|
|
|
|
Fixed
Assets |
2.01 |
2.02 |
1.95 |
|
Inventory
|
6.65 |
7.48 |
10.77 |
|
Debtors |
6.87 |
7.84 |
9.62 |
|
Interest
Cover Ratio |
4.41 |
5.20 |
3.49 |
|
Operating
Profit Margin (%) |
11.46 |
12.19 |
13.19 |
|
Profit Before
Interest and Tax Margin (%) |
8.62 |
9.34 |
9.78 |
|
Cash
Profit Margin (%) |
7.49 |
9.78 |
8.60 |
|
Adjusted
Net Profit Margin (%) |
4.65 |
6.93 |
5.20 |
|
Return on
Capital Employed (%) |
15.67 |
18.11 |
18.64 |
|
Return on
Net Worth (%) |
23.91 |
32.53 |
22.46 |
STOCK PRICES
|
Face Value |
Rs. 10.00/- |
|
High |
Rs. 82.00 |
|
Low |
Rs. 80.65 |
LOCAL
AGENCY FURTHER INFORMATION
The company
is in trade terms with:
DAP, Pesticides, Seeds, SSP, Mixtures, Micro, Nutrients and
MOP
The
company's fixed assets of important value include land, buildings, plant &
machinery, furniture & fittings and vehicles.
History
DCM Shriram Consolidated,
incorporated in 1989 is a diversified company having interest in Fertilisers,
Chlor Alkalis, Cement, Sugar, PVC & its compounds etc. The company has
tie-up with Zeon Kasei Company of
The subsidiaries of DCM are DCM Shriram Credit and Investments Limited, DCM
Shriram Aqua Foods Limited, DCM Shriram International Limited, DSCL Energy
Services Co Limited, Shriram Bioseed Genetics India Limited, DCM Shriram
Infrastructure Limited, Bioseeds Limited, Bioseeds Genetics Vietnam, Bioseed
Research
In 1995, the company commissioned a Chloralkali plant at Bharuch, Gujarat,
based on state-of-the-art membrane cell technology from Asahi Chemicals,
During 1999-2000, the Company commissioned a modern solid hazardous waste
facility at Bharuch. The Chlor Alkali Units at Bharuch and
The company hived off of its Polymer Processing Business to its 91% subsidiary
Shriram Polytech Limited(formerly DCM Shriram Exports Limited)., through a
Scheme of Arrangement effective from July, 01 at a total consideration of
Rs.435.000 Millions and is setting up of a wholly owned subsidiary outside
India with capital of upto US $ 3.5 million.
The company has entered into MoU with Zurich Financial Services (ZFS) whereby
the company, its promoters companies and other group/associate companies will
form a joint venture with ZFS to start Life Insurance Business, Non-life
insurance business and related support services in
During 2001-02 the capacity of Chlor Alkali was expanded to 102050 MT. The
company is also planning to expand the bottling facility as the revenues from
Bharuch unit has increased as compared to previous year. It has secured the BIS
certification for its cement plant for 43 grade quality.
In the year 2003-04 the company implemented a Scheme of Arrangement approved by
the Hon'ble High Court of Delhi for demerger of its Energy business to its
subsidiary DSCL Energy Services company Limited and for merger of its
subsidiary Ghaghara Sugars Limited into the company w.e.f 01.04. 2003.
In September 2005 the company has commissioned a new 40 MW coal based captive
power facility at
During October 2005 the company has sub-divided its equity share face value
from Rs.10/- per share to Rs.2/- per share. Further the company has issued
bonus equity shares to its shareholders in the ratio of 1:1.
During the year 2005-2006, the Company has issued and allotted 8,29,51,660
fully paid up Bonus Shares of Rs.2/- each in the ratio of 1 : 1 by capitalizing
amount out of Capital Redemption Reserve.
During the year the companies production capacity of Calcium Carbide increased
from 56100 MT to 112000 MT, PVC Resins capacity expanded from 33000 MT to 61250
MT, Caustic Soda capacity increased from 132500 MT to 176250 MT, Chlorine
capacity increased from 80250 MT to 116750 MT, Hydrochloric Acid (100%)
capacity increased from 69750 MT to 73250 MT, Sugar capacity increased from
11000 TPD to 14000 TPD, UPVC Windows increased from 36000 MT to 90000 MT. The
companies production capacity of Ammonia, Urea, Compressed Hydrogen, Stable
Bleaching Powder, Cement, Spindles and PVC Compounds stood at 198000 MT, 330000
MT, 1565 MT, 9900 MT, 400000 TPA, 8880 Nos and 23400 TPA respectively.
DCM Shriram Consolidated Limited
(DSCL)
DSCL is a business group
with turnover of over Rs. 19000 millions, Profit After Tax above the Rs 1 000
millions mark and has two broad operational thrusts: (i) the energy intensive
businesses (chloro-vinyl chain and cement), and (ii) the Agri-businesses that
covers Urea, Sugar, Hybrid Seeds and Agri- Merchandised Inputs (DAP, MOP, SSP
and pesticides). The Company has recently launched into value-added businesses
that include UPVC-based Fenesta™ Building Systems, energy services and a rural
retailing initiative called Hariyali Kisaan Bazaar.
Growth defined
Their approach to
holistic business growth extends beyond financial performance to cover all
aspects of their operations. It includes growing all key stakeholder
relationships. Their customers, for whom they create their products and
services, their vendors and business associates, who support their initiatives
and plans, their employees who are the backbone of their operations and their
lenders and shareholders who motivate and encourage us to do better.
"Growth Values" guide their initiatives and relationships whereby
while furthering the wealth and returns for all stakeholders associated with
the Company, they endeavour to make a positive contribution to the community
and the environment. Consistent growth over the long term and building globally
competitive businesses are integral to their approach towards business.
Consider all these aspects together and the result is "Growth Consolidated".
Bringing all their businesses under a common strategy and an integrated
operating style delivers "Growth Consolidated". At DCM Shriram
Consolidated Limited, their business drive can be termed as "Growth
Consolidated".
Growth Values
DSCL's
core values and beliefs are a reflection of its commitment to build a world
class, learning organisation, striving for excellence in all its endeavors.
Customer Focus
• Be sensitive to the needs of the
customer, develop superior customer insight.
• A commitment to surpass expectations
and deliver superior value.
Innovation & Excellence
• Strive to think differently and
promote creativity.
• Make continuous improvement a way
of life, drive excellence.
Relationships & Human dignity
.• Value people and partnerships
• Nurture understanding, compassion,
trust and respect in all relationships
Team Work
• Work closely as a cohesive,
well-knit team
• Inculcate a spirit of openness and
collaboration
Business direction and initiatives
Guided by sectoral dynamics the Company has created a research driven business
model, investing both time and resources in creating hybrids that possess
robust disease resistance, offer high and stable yields through varied climatic
conditions and guarantee high grain quality. The Company has thus far developed
25 new products over the past three years.
The Company, keeping with best practices has also created a comprehensive
physical infrastructure encompassing a seed conditioning plant, a cold-storage
facility besides quality assurance facilities and multiple parent seed farms.
That along with an able workforce and process competencies allows DSCL to
market its products more profitably. Furthermore, the Company's existing
marketing and distribution set up provides a ready platform to sell the hybrid
seeds, thus substantially lowering the cost of operations and time-to-market
for new products.
The Indian sugar industry provides direct employment to over half a million
skilled and unskilled workers mainly from the rural area. Besides, over fifty
million sugarcane farmers and their dependents are involved in sugarcane
cultivation. Due to a large farming community dependent on sugarcane income,
the Indian sugar industry has been highly regulated in terms of input cost and
release mechanism. The Central Government stipulates a 'Statutory Minimum
Price' (SMP) for the purchase of sugarcane throughout the country. While the
states are allowed to prescribe their own 'State Advisory Price' (SAP), this
price cannot be lower than the SMP at any time. Furthermore, sugar mills are
legally bound to purchase the entire crop in their respective 'command areas'
at the predetermined price. Such command areas are allocated annually depending
upon the mill's track records and capacities. DSCL has about 120,000 cane
growers supplying the two mills during the crushing season. To facilitate
faster delivery of the cane the Company has set up a network of cane collection
centres around its mills. DSCL sugar mills are designed to make above average
recoveries, improving the operating efficiencies further.
The Company sells 50 and 100 kg bags of sugar to wholesalers throughout parts
of Uttar Pradesh and elsewhere in the north-eastern parts of the country and
The sugar industry yields two main by-products, molasses and bagasse, which
have important applications in other industries. Molasses find usage primarily
in the chemicals and liquor industries. Bagasse finds application primarily in
the paper products industry and as a fuel for co-generation. The molasses and
surplus bagasse generated during the manufacture of sugar is sold after meeting
captive needs.
Business direction and initiatives
DSCL operates a modern and highly automated sugar operation that allows it to
consistently make higher recoveries, enhance efficiencies and in turn realise
better earnings from the business. Further, aided by strong business processes,
the Company is able to focus on enhancing its operational parameters
continually. Sugar has been identified as one of the growth drivers by the
Company with the aim of emerging as one of the most efficient and profitable
sugar manufacturers in the country. The company's focus is to work closely with
farmers to improve cane production and cane quality, and to continue producing
sugar in the most efficient way.
DSCL's emphasis on cane development places it ahead of others in fostering a
'trust-based' relationship with the farmers. The Company routinely assists
farmers with soil fertility mapping for judicious fertilizer usage, varietals
propagation and the replacement of low yield / low recovery varieties. It also
plays an active role in popularising the use of bio-fertilizers, modern
agri-inputs and associated plant protection measures to increase yields per
hectare. The company has even implemented an assured irrigation scheme in its
cane area.
Additionally, with the objective of facilitating the movement of cane to its
mills, the Company has carried out a series of initiatives including
construction of roads and providing transportation for the sugarcane. DSCL
regards farmers as important and invaluable constituents of its objective of
growing the business, and remains committed to raising their economic
profile.
DSCL also believes in actively managing its product realisations and has made the
strategic decision to distribute its sugar in states other than Uttar Pradesh
to avoid oversupply and consequent erosion in realisations in its primary
market around its mills. Further, as the Company sells its molasses and bagasse
production within a 200 km radius of its mills it is able to get better
realisations.
The Company has started supplying power to the state electricity grid from
December 2004 and plans to enhance it further with realisation of energy efficiencies
in its processes and a minor enhancement in the co-generation facilities. This
activity is expected to augment the Company's earnings going forward.
The Company is currently implementing an expansion plan covering both its
manufacturing facilities. While Rupapur will witness a capacity, addition of
2000 TCD taking its total capacity to 6,500 TCD. the Ajbapur facility will see
a 1000 TCD expansion improving crushing capacity to 7500 TCD. The expansions
are expected to be completed on schedule by October 2005.
Other Businesses
Cement
Profile
DSCL uses the waste sludge produced during the making of calcium carbide as key
input for the cement business. The Company manufactures 400,000 TPA of premium
grade cement at its integrated manufacturing complex at
Strategy
The cement business enjoys the dual advantage of inexpensive captive power and
readily available key input. The cement manufactured at its computer process
controlled and highly automated facility results in a product that displays a
high degree of whiteness and possesses superior strength and quick-setting
features. The cement produced by the Company commands premium pricing on
account of its superior quality and the 'SHRIRAM' brand name and is recognised
as market leader in the areas of distribution.
Energy Services/ESCO
Profile
DSCL operates a reward-sharing model whereby it identifies opportunities for
energy savings, realises the savings and then shares the rewards with its
clients Through this division the Company provides know-how, maintenance and
energy-efficient product design and project customisation through alternative
fuel switching. Its scope of activities covers both captive and co-generation
facilities and seeks to assist customers in the conservation of energy and use
of renewable sources of energy. This division has won a consulting assignment
from Asian Development Bank (ADB) for renewable and energy efficiency
development project in
Strategy
The Company has gained competencies in the erection of effective and efficient
energy systems on the back of its experience in managing its own captive and co-generation
facilities. The Company has sought to institutionalise these abilities through
DSCL Energy Services Company.
Real Estate
In accordance with the decision of the Hon'ble Supreme Court dated 10th May
1996 and the learned District Court dated 25th February 2005, the Company
surrendered the possession of 30.07 hectares of land during the current year to
DDA to be kept as green/open area without prejudice to its rights and
submissions in the review petitions. The Company has also made substantial
progress in vacating the quarters on the land at
Growth ideas
New Business
Fenesta(TM) Building Systems
The value-added Ultra PVC (UPVC) window and door systems that DSCL markets
under the Fenesta(TM) brand was a natural extension of its PVC Resin,
compounding business. The Company has a dedicated plant to manufacture the
Fenesta(TM) Building Systems profiles at its integrated manufacturing complex
at
UPVC, the un-plasticized variant of PVC besides being environmentally friendly,
offers high impact resistance apart from being non-corrosive in nature. The
final product provides superior thermal and sound insulation, does not rust and
offers high tolerance for extreme weather conditions. Moreover it requires very
little upkeep with the product lasting as long as the building; it is installed
in, itself. These environmental friendly solutions are rapidly becoming the
preferred choice of builders, architects and individual customers.
DSCL has in place a dedicated sales team in markets in which it is present.
This provides the benefit of close contact with the end-users, mainly the real
estate developers community, allowing the Company to promote its range besides
servicing actual customer requirements. Complementing the sales set-up is a
team of technical experts that advises on customisation options, colour options
and other specifications.
DSCL's technological edge, contemporary design, end to end customer service and
superior infrastructure provides a definitive competitive advantage in a market
that is very discerning and sophisticated. The Fenesta(TM) offering is a
complete system right from fabrication and design to installation at the
customer's site, resulting in consistent quality and better understanding of
client's needs.
The integrated nature of operations allows the Company to exercise complete
control over the entire value chain from blending & extrusion to window
fabrication and final installation. DSCL has entered into a technical
collaboration with Heywood Williams (HW) Group Plc of
This business reported revenues of Rs.400.0 millions in the year ended March
31, 2005, the first full year of its operations.
Windows and other building components made of UPVC have gained wide popularity
across different climatic conditions. UPVC windows have a dominant share in
Europe and growing share in the
This year the company embarked upon a strategy to create a pan-India presence
and launched Fenesta(TM) Building System in Pune in August '04; in Mumbai and
The response from the markets continues to be encouraging with the company
having decided to further increase the penetration of the product. Accordingly
sales offices have been opened at Chennai and
Hariyali Kisaan Bazaar
DSCL, recognising the hitherto untapped rural demand for modern, trustworthy
and fair value, retail channels had earlier embarked on a rural retailing
initiative called the Hariyali Kisaan Bazaar. The venture has been receiving a
tremendous response from its target customers in the rural markets. The
business model for HKB is driven by mutual trust, confidence and a strong
relationship that they share with the farmers and derives its strength from
their ability to provide top-of-the-line products and services at value for
money prices at locations close to where they live and work.
The rural retail store chain offers a comprehensive range of products including
fertilizers, pesticides, seeds, farm implements, irrigation equipment and
animal products, and value added services like agronomy and advisory services,
output linkages, credit-financing and more to the rural citizenry. The
comprehensive offering of agri inputs and relevant agri technology to the farmers
is creating a strong bond with the farmers and building trust and reliability
for the Hariyali Kisaan Bazaar.
The Company currently owns and operates a network of 16 rural stores throughout
The agronomy services offered at these outlets is manned by a team of qualified
agronomists and agri-specialists who are on call round the clock. The team
provides support to farmers in selection of right agri-inputs apart from
identifying opportunities for crop rotation. The outlets also have
veterinarians at hand who assist farmers in their buying decisions for animals.
These allied agri-services offered under one roof not only enhance farming
efficiency and productivity but also create a strong affinity for the brand
that in the end leads to trust and enduring relationships.
The Company, after meticulous preparation, has recently begun offering farm
output management services aimed at improving realisations and finding markets
for more profitable crops. The range of advice covers price discovery, storage,
handling and sales. DSCL has identified three new focus areas for Hariyali
Kisaan Bazaars namely, contract farming, processing and exports.
The Company in conjunction with a public sector oil company launched fuel
retailing services at a few locations in the year. Encouraged by the response
to this services the Company plans to provide this facility at more outlets
going forward. Moreover, the Company also intends to retail LPG through its
stores in the coming year. This is intended to address one of the key
requirements of a trusted source of farm fuels and diesel in the rural areas.
The Company also intends to disburse credit and provide other financial
services to farmers through a tie-up with a leading private sector bank.
The Company has suitably located the stores at key hinterland roads to capture maximum
footfalls. Moreover, DSCL recognises that the key to ensuring high conversions
lies in demonstrating the ability to provide top-of-the-line products at
value-for-money prices. To make that possible, it sources its merchandise
directly from large local vendors after validating for quality. To further
enhance the value proposition the Company is planning to sell FMCG products,
automobile spare parts and construction-related products (mainly cement and
paints from the Hariyali Kisaan Bazaar.
An important facet of the customer-trust equation is choice. Each sale is made
on a best effort basis, where both 'SHRIRAM' and other brand products are
accorded equal importance, without unduly favouring any particular one.
Similarly, displays are arranged by application and not brand facilitating an
objective assessment on the part of the customer.
The usage of modem IT systems allows DSCL to track customer preferences and
optimise inventory levels and in the process realise better sales and higher
efficiencies.
The Hariyali Kisaan Bazaar business had revenues of Rs.29 millions in the
financial year 2004-2005.
The potential to raise farm productivity and profitability in the country
cannot be overstated. Also, the farming community is fast becoming aware of and
wants to apply the latest techniques. Rural incomes are rising and there is an
increasing need for trusted transactions. The Company believes that based on
its rich experience in the agri-sector, it is well placed to create a
substantial and sustainable value from this business.
The format has been heartily adopted by the farmers as indicated by the
substantial number of repeat customers. The Company hopes to consolidate and
leverage this trend to its advantage going forward, by offering more choice.
Also, the Company plans to capitalise on the first mover advantage it enjoys in
this line of activity and expand operations by another 28-30 stores in two
years. Over the long term, the Company has envisaged a nationwide presence in a
graded manner.
The scale of activity after completion of the rollout will allow DSCL to
realise dual benefits of lower cost of operation and better bargaining ability
with vendors. The extended size of operation will help the Company derive
maximum value from this largely ignored opportunity.
Dividend:
The Directors are pleased to recommend total dividend @45% (including the
interim dividend @20% paid in November, 2005) on Equity Shares of Rs.2/- each
for the year ended 31.03. 2006.
Performance:
The Company attained revenues of Rs.24763.200 Millions against revenues of
Rs.19051.900 Millions in previous financial year - a growth of 30%. The
operating profit of the Company for the year was at Rs.2837.400 Millions,
higher by 25% as compared to operating profit of Rs.2271.000 Millions in the
previous year. The Company's profit before tax (excluding exceptional items)
increased to Rs.1651.000 Millions from Rs.1385.300 Millions, reflecting a
growth of 19%.
The growth during the year was primarily driven by higher volumes in Chemicals,
Plastics and Sugar businesses, better margins in Chemical business in first
half of the year and better realisations in Sugar and Cement businesses. The
improvement in performance was despite tremendous odds faced due to higher
input costs (cane, salt, furnace oil, carbon materials, etc.), sharp reduction
in PVC prices (~16%), freeze on reimbursement of conversion cost increases in
the urea business, unclear government policy on DAP/MOP subsidy and higher
interest costs.
The detailed performance of various businesses of the Company for the year
ended 31.03. 2006 has been stated in the Management Discussion and Analysis
Report, which appears as a separate statement in the Annual Report.
Subsidiary
Companies:
In tarms of approval granted by the Central Government under
Section 212(8) of the Companies Act, 1956, the Audited Statements of Accounts
and the Auditors' Reports thereon for the year ended 31.03.2006 along with the
Reports of the Board of Directors of the Company's subsidiaries have not been
annexed. The Company will make available these documents upon request by any
member of the Company interested in obtaining the same. However, pursuant to
Accounting Standard AS-21 issued by the Institute of Chartered Accountants of
India, Consolidated Financial Statements presented by the Company includes the
financial information of its subsidiaries.
Sub-Division of Equity Shares & Issue of Bonus Shares:
Pursuant to the resolution passed by the shareholders by Postal Ballot, the
Company had sub-divided the face value of Equity Shares of Rs.10/- each into 5
Equity Shares of Rs.2/- each w.e.f. 18.10.2005.
During the year, the Company has issued and allotted 8,29,51,660 fully paid up
Bonus Shares of Rs.2/- each in the ratio of 1 : 1 by capitalizing amount out of
Capital Redemption Reserve.
Finance:
The Company continues to enjoy the highest rating of A1+ for its short term
borrowings. The Company has been upgraded from
MANAGEMENT DISCUSSION AND ANALYSIS
Performance Overview:
The company recorded satisfying overall performance in FY 2005-06:
The consolidated group turnover of over Rs.25000.000 Millions, an increase of
28% over last year.
The operating profit going up to Rs.2950.000 Millions, an increase of about 25%
over last year.
Completion and stabilisation of expansions in the Chlor-alkali, PVC resin and
Calcium carbide businesses along with 40 MW thermal power plant.
Completion of the first phase of expansion in sugar business raising capacity
from 11 ,000 TCD to 14,000 TCD and satisfactory progress on two new mills to
raise the capacity to 33,000 TCD by November, 2006.
Substantial progress in their newer initiatives i.e. Hariyali Kisaan Bazaar,
Fenesta Building Systems and ESCO businesses.
Upgrading of the credit rating of the Company by ICRA from 'A+' to 'AA-'.
Encouraged by the overall progress of the businesses, the directors announced
the company's first Bonus Issue in August 2005 in the ratio of 1:1. The stock
market also took note of the company's performance resulting in a growth in
market capitalisation by over 100% in this financial year.
The year also saw some areas of concerns which includes softening in the
selling prices of the ChloroVinyl products, reduction in the custom duty for
PVC and Caustic Soda in the Budget for 2006-07, increase in prices of furnace
oil which the company uses for generation of power at one of its facilities,
delays in payment of subsidy on fertilisers by the Government of India and
rising interest costs.
The expansion initiatives already completed and planned to be completed in
2006-2007 will contribute to healthy volume growth in the company's businesses
in the next two years. This volume growth will also enable the company to
minimise the impact of softening in prices of Caustic soda/Chlorine and PVC
resin and rising cost pressures.
In the coming year, the company proposes to continue with its strategy of
expansions in existing businesses, strengthen cost competitiveness and
aggressively grow the new businesses i.e. Hariyali Kisaan Bazaar ano Fenesta
Building Systems.
The Company has the following two main lines of business:
Agri businesses comprising Agri inputs (manufactured as well as traded) and
Sugar. The rural retail business i.e. Hariyali Kisaan Bazaar is a value added
activity in the agri area.
Chloro-Vinyl businesses comprising Chemicals and Plastics, i.e. PVC Resin, PVC
Compounds and Calcium Carbide. Fenesta Building Systems is the latest venture
to add value to the Company's Plastics business.
Besides the above, the company has smaller businesses in cement, textiles and
energy services. An analysis of each of the different businesses is provided
below.
Business-wise performance review and Outlook:
Chloro- Vinyl businesses:
Chemicals:
DSCL's Chemicals business comprises of Caustic Soda (lye and flakes), Chlorine
(liquid and Gaseous) and associated chemicals including hydrochloric acid,
stable bleaching powder, compressed hydrogen rnd sodium hypochlorite.
The manufacturing facilities, located at
Industry overview:
The Chlor-alkali industry in
The total demand for Caustic Soda and Chlorine in the country is approximately
1.95 million tonnes and 1.7 million tonnes respectively growing at a little
below the GDP growth rate. The demand is met primarily through domestic
manufacturers with small quantities of imports and exports. The imports/exports
are freely permitted with the reduced customs duty level at 12.5%. The prices
of Caustic Soda are fully linked to international prices. The prices of
Chlorine are also significantly influenced by global price dynamics.
Caustic Soda is used in several large industries like, paper, aluminium,
dyestuffs, soaps and detergents, textiles, pharmaceuticals and DM water plants.
Chlorine, on the other hand, is used in industries like PVC, organic chemicals,
inorganic chemicals, pesticides and water treatment.
The International prices of Chlor-alkali which witnessed a significant uptrend
from March 2004 started to witness a decline in the second half of FY 2005-06.
From USD 632/- per tonne in April 2005 the international ECU prices (combined
unit of one tonne of Caustic Soda and proportionate chlorine) declined to USD
504/- tonne in January-February 2006.
The domestic ECU prices also declined during the second half of the year. After
touching a high of Rs.26,000-Rs.27,000 per tonne in the first quarter of the
year the prices dropped to as low as Rs.17,000/- per tonne in the second half
and then marginally recovered to Rs.18,000-20,000/- per tonne.
While DSCL produces caustic soda entirely for the market, it is able to utilise
almost a third of the chlorine produced captively for production of chemicals
& PVC Resin. The balance chlorine is sold through pipelines to dedicated
customers and through tonners in the merchant market. They enjoy long-term and
strong relationships with large customers; end users in major Chlor alkali
consumuing industries such as aluminium, paper, soap, refrigerant gases etc and
have a wide network of distributors in West, Central and north
Press Releases
Friday, April 13, 2007
DCM Shriram Consolidated Limited has informed
BSE that the members of the Company, will consider to approve the following Ordinary
Resolutions, by way of Postal Ballot: 1. To transfer, sell, lease, license or
dispose of either through scheme of reconstruction (under relevant provisions
of the Companies Act, 1956) or otherwise in such manner as the Board may in its
sole discretion deem appropriate, the business of Hariyali Kisaan Bazaar,
presently a division of the Company, in whole or in part, for such
consideration, on such terms and conditions and with effect from such date as
may be decided by the Board and to finalize and execute all such documents
including agreements, deeds of assignment / conveyance and other documents as
the Board may deem necessary or required and to do all such other acts, deeds,
matters and things which are incidental and consequential thereto or which may
be considered necessary by the Board, subject to necessary provisions and
approvals. 2. To progress the development and / or transfer, sell, lease,
license or dispose of either through scheme of reconstruction (under relevant
provisions of the Companies Act, 1956) or otherwise, in such manner as the
Board may in its sole discretion deem appropriate, whether in whole or in part,
the Company’s land at Shivaji Marg, New Delhi and / or at other location(s) in
India with or without any associated rights, assets, obligations and / or
liabilities, present and future, for such consideration and on such terms and
conditions as may be decided by the Board and to finalise and execute necessary
documents including agreements, deeds of assignment / conveyance and other
documents as the Board may deem necessary or required and to do all such other
acts, deeds, matters and things which are incidental and consequential thereto
or which may be considered necessary by the Board, subject to necessary
provisions and approvals. The Company has appointed Shri. T V Narayanaswamy, a
practicing Company Secretary as Scrutinizer for conducting the postal balot
process in a fair and transparent manner. The Postal Ballot form duly completed
should reach the scrutinizer on or before April 30, 2007. The scrutinizer will
submit his report to the Chairman of the Board after completion of the scrutiny
and the results of the postal ballot will be announced by the Company.
DCM
Shriram Consolidated net profit at Rs 196.800 millions in December 2006 quarter
Tuesday, January 23, 2007
DCM Shriram Consolidated has posted a net profit
of Rs 196.800 millions in December 2006 quarter compared with Rs 244.500
millions in December 2005 quarter. Net sales rose to Rs 8002.700 millions from Rs
6742.500 millions.
Monday,
January 22, 2007
DCM
Shriram Consolidated Limited has informed the Exchange regarding a press
release dated January 22,2007, titled "DSCL`s Q3FY2007 net sales up19% at
Rs. 8000 millions; Plans conversion of Power Capacity to Cheaper Fuels at
Bharuch along with Capacity expansions".
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. 41.00 |
|
|
1 |
Rs. 81.80 |
|
Euro |
1 |
Rs. 55.58 |
SCORE
& RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP
CAPITAL |
1~10 |
7 |
|
OPERATING
SCALE |
1~10 |
7 |
|
FINANCIAL
CONDITION |
|
|
|
--BUSINESS
SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT
LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT
POINTS |
|
|
|
--BANK
CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER
ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT
POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT
ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER
MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
64 |
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
|
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 |