MIRA INFORM REPORT

 

Report Date :

29.05.2007

 

IDENTIFICATION DETAILS

 

Name :

GTN EXPORTS LIMITED

 

 

Registered Office :

Plot No. 29, Nagarjuna Hills, Punjagutta, Hyderabad – 500 082, Andhra Pradesh

 

 

Country :

India

 

 

Financials (as on) :

31.03.2006

 

 

Date of Incorporation :

24.07.1981

 

 

Com. Reg. No.:

01-41292

 

 

CIN No.:

[Company Identification No.]

U51909AP1981PLC041292

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

HYDG00890B

 

 

Legal Form :

A Closely Held Public Limited Liability Company

 

 

Line of Business :

Manufacturers of Cotton Grey and Dyed Woven Fabrics.

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Maximum Credit Limit :

USD 350000

 

 

Status :

Satisfactory

 

 

Payment Behaviour :

Usually correct

 

 

Litigation :

Clear

 

 

Comments :

Subject is a well-established company of GTN Textile Group or Patodia Group. General financial position is satisfactory. Payments are reported as Usually correct and as per commitments.

 

The company can be considered good for normal business dealings.

 

 

LOCATIONS

 

Registered Office :

Plot No. 29, Nagarjuna Hills, Punjagutta, Hyderabad – 500 082, Andhra Pradesh, India.

Tel. No.:

91-40-23351585/ 78 / 79/87

Fax No.:

91-40-2335 7820

Email:

patodia@hdl.vsnl.net.in

Website:

http://www.gtntex.com

 

 

Corporate Office :

Ermathala Post, Alwaye – 683 105, Ernakulam – 683105, Kerala, India

Tel. No.:

91-484-2623715

Fax No.:

91-484-2625634

E-Mail :

patodia@hd1.vsnl.net.in

Location:

Rented

 

 

Factory 1 :

18, K. R. Puram Road, Ganapathy, Coimbatore, Tamil Nadu, India

Tel. No.:

91-422-2562930/2563328/2566517

Fax No.:

91-2562496

E-Mail :

gtnengg@md3.vsnl.net.in

Contact Person:

Mr. K. B. Babu, General Manager

Location:

Owned

 

 

Branches :

Located at Mumbai, Kolkata, Cochin and Chennai.

 

 

DIRECTORS

 

Name :

Mr. Madanlal Patodia

Designation :

Director

Address:

7 Sambhunath Mullick Lane, Kolkata – 700 007, West Bengal, India.

Email:

hyd_1patodia@gtnindustries.com

Date of Birth:

20.09.1915

Date of Appointment:

27.07.1981

 

 

Name :

Mr. Mahendra Kumar Patodia

Designation :

Managing Director

Address:

Patodia House, Plot No. 145, Road No. 3, Banjara Hills, Hyderabad – 500 034, Andhra Pradesh, India.

Date of Birth:

25.08.1951

Date of Appointment:

24.07.1981

Email:

hyd_1patodia@gtnindustries.com

 

 

Name :

Mr. Sushil Sancheti

Designation :

Director

Address:

H No. 3-6168/4, Hyderguda, Hyderabad – 500 029, Andhra Pradesh, India.

Tel. No.:

91-40-23351585

Fax No.:

91-40-23358387

Email:

sushil@ramspg.com

Date of Birth:

30.12.1973

Date of Appointment:

02.12.2006

 

 

Name :

Ms Prachi Patodia

Designation :

Director

Address:

Plot No. 145, Road No. 3, Banjara Hills, Hyderabad – 500 034, Andhra Pradesh, India.

Email:

hyd_1patodia@gtnindustries.com

Date of Birth:

14.08.1979

Date of Appointment:

08.12.2001

 

 

Name :

Mrs. Umang Patodia

Designation :

Director

 

 

Name :

Mr. Binod Kumar Patodia

Designation :

Director

 

 

Name :

Mr. T. M. Gopalaswamy

Designation :

Director

 

 

Name :

Mr. Chandulal Dayalji Thakker

Designation :

Director

 

 

Name :

Mrs. Radha Gobind Bhuradia

Designation :

Director

 

 

Name :

Mr. B. L. Singhal

Designation :

Director

 

 

Name :

Mr. Purshottamdas Patodia

Designation :

Director

 

 

Name :

Mr. Rajendra Kumar Patodia.

Designation :

Director

 

 

KEY EXECUTIVES

 

Name :

Mr. E. K. Balakrishnan

Designation :

Company Secretary

 

 

MAJOR SHAREHOLDERS

 

Names of Shareholders

 

No. of Shares

EQUITY SHARES

 

 

GTN Textiles Limited

 

11

Mr. Madanla Patodia

 

10

Mrs. Anjana Patodia

 

63400

 

 

 

PREFERENCE SHARES

 

 

Mr. Purshottamdas Patodia

 

20

Mr. Binod Kumar Patodia

 

20

Mr. Mahendra Kumar Patodia

 

20

Mrs. Indira Devi Patodia

 

20

Mrs. Sharada Patodia.

 

20

 

 

 

Total:

 

63521

 

 

BUSINESS DETAILS

 

Line of Business :

Manufacturers of Cotton Grey and Dyed Woven Fabrics.

 

 

Products :

Ř       Trading in Engineering Goods

Ř       Cotton Grey & Dyed Woven Fabrics

 

Products

ITC Code No.

Engineering Goods- Gate Valves, Yarn Trading

520820/520900

 

 

Exports :

 

Countries :

Japan and Italy

 

 

GENERAL INFORMATION

 

No. of Employees :

90

 

 

Bankers :

Ř       IDBI Bank, Coimbatore

Ř       Corporation Bank, Hyderabad

Ř       Punjab National Bank, CMO, Bank Street, Abids, Hyderabad.

 

 

 

Banking Relations :

Satisfactory

 

 

Auditors :

 

Name :

Lodha & Company

Chartered Accountants

Address :

6, Karim Chambers, 40, Ambalal Dashi Marg  (Haman Street), Mumbai – 400 023, Maharashtra, India

 

 

Parent Company:

Ř       GTN Textiles Limited

 

 

CAPITAL STRUCTURE

 

Authorised Capital :

No. of Shares

Type

Value

Amount

149750

Equity Shares

Rs. 100/- each

Rs. 14.975 Millions

250

Preference Shares

Rs. 100/- each

Rs. 0.025 Millions

 

Total:

 

Rs. 15.000 Millions

 

Issued, Subscribed & Paid-up Capital :

No. of Shares

Type

Value

Amount

124231

Equity Shares

Rs. 100/- each

Rs. 12.423 Millions

 

 

FINANCIAL DATA

[all figures are in Rupees Millions]

 

 

 

ABRIDGED BALANCE SHEET

 

SOURCES OF FUNDS

 

 

31.03.2006

31.03.2005

SHAREHOLDERS FUNDS

 

 

 

1] Share Capital

 

12.423

12.423

2] Share Application Money

 

0.000

0.000

3] Reserves & Surplus

 

79.248

66.683

4] (Accumulated Losses)

 

0.000

0.000

NETWORTH

 

91.671

79.106

LOAN FUNDS

 

 

 

1] Secured Loans

 

137.685

112.692

2] Unsecured Loans

 

0.000

0.000

TOTAL BORROWING

 

137.685

112.692

DEFERRED TAX LIABILITIES

 

7.085

6.377

 

 

 

 

TOTAL

 

236.441

198.175

 

 

 

 

APPLICATION OF FUNDS

 

 

 

 

 

 

 

FIXED ASSETS [Net Block]

 

58.823

58.647

Capital work-in-progress

 

0.650

0.493

 

 

 

 

INVESTMENT

 

0.407

0.006

DEFERREX TAX ASSETS

 

0.000

0.000

 

 

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

 

 

 

Inventories
 
106.260

80.837

 

Sundry Debtors
 
8.965

21.506

 

Cash & Bank Balances
 
34.437

55.381

 

Other Current Assets
 
0.999

0.142

 

Loans & Advances
 
70.495

33.464

Total Current Assets

 
221.156

191.330

Less : CURRENT LIABILITIES & PROVISIONS

 
 

 

 

Current Liabilities
 
19.984

31.238

 

Provisions
 
24.611

21.063

Total Current Liabilities

 
44.595

52.301

Net Current Assets

 
176.561

139.029

 

 

 

 

MISCELLANEOUS EXPENSES

 

0.000

0.000

 

 

 

 

TOTAL

 

236.441

198.175

 

PROFIT & LOSS ACCOUNT

 

PARTICULARS

 

 

31.03.2006

31.03.2005

Sales Turnover [including other income]

 

432.022

313.669

 

 

 

 

Profit/(Loss) Before Tax

 

(149.552)

(189.011)

Provision for Taxation

 

0.000

0.000

Profit/(Loss) After Tax

 

(149.552)

(189.011)

 

 

 

 

Export Value

 

320.850

NA

 

 

 

 

Total Expenditure

 

581.574

502.680

 

KEY RATIOS

 

PARTICULARS

 

 

 

31.03.2006

31.03.2005

PAT / Total Income

(%)
 

(34.62)

(60.26)

 

 
 

 

 

Net Profit Margin

(PBT/Sales)

(%)
 

(34.62)

(60.26)

 

 
 

 

 

Return on Total Assets

(PBT/Total Assets}

(%)
 

(53.21)

(75.46)

 

 
 

 

 

Return on Investment (ROI)

(PBT/Networth)

 
 

(1.63)

(2.39)

 

 
 

 

 

Debt Equity Ratio

(Total Liability/Networth)

 
 

1.99

2.09

 

 
 

 

 

Current Ratio

(Current Asset/Current Liability)

 
 

4.96

3.66

 

 

LOCAL AGENCY FURTHER INFORMATION

 

 

BUSINESS

 

Subject is engaged in as manufacturers of Cotton Grey and Dyed Woven Fabrics.

 

Subject is also engaged in as manufacturers and exporters of spice oils and oleoresins.

 

The company’s product range includes :

 

Ř                   API 6A Valve Bodies

Ř                   Slabcastings

Ř                   Oemcomponents

Ř                   Sheave Castings

Ř                   Ni-hard Castings

Ř                   Gear and Gear boxes

Ř                   Non – Ferrous components

Ř                   Valve industry

Ř                   Shaft and rollers

 

It was the first company to export cotton yarn from India to Japan and Italy.  In 1992, it exported virtually its entire production, although it is not an EOU.  The installed capacity of its plant at Alwaye, Kerala has been increased from 12000 to 38600 spindles, bringing the company’s total spindleage to 60340.  In January, 1993, the company came out with its maiden public issue to modernise the existing plans, meet long-term working capital requirements and invest in the groups newly promoted company, Patspin India Limited.  The company and Packworth Udyog are subsidiaries of GTN Textiles.

 

In 2000-01, the company has raised term loan of Rs. 228.300 millions under Technology Upgradation Fund Scheme which provides for 5% interest subsidy, for marginal increase in capacity and substantial modernisation / replacement of old machinery across the units, by availing world-class technology.

 

 

Name of the Company

GTN EXPORTS LIMITED

Presented by

Mr. M. K. Patodia, Director

1. Date and description of the instrument

    creating  or evidencing the charge  

28th October 2002

Agreement of Hypothecation of movable assets forming part of fixed/book assets.

 

Packing Credit agreement (Hypothecation)

2. Amount secured by the charge /amount  

    owing on security of the charge

Amount in Millions

 

Export Packing Credit

20.000

Foreign Outward Usant Bill Purchase

20.000

Term Loan I

11.700

Term Loan II

13.500

Letter of Guarantee

7.500

Foreign Letter of Credit Specific one time (Sub Limit of TL- II)

(10.000)

 

 

Total:

72.700

3. Short Particular of the property charged. If

    the property acquired is subject to change

   date of acquisition of property should be

   given 

The hypothecation assets which expression shall include all the assets and movable property of any king belonging to them, which now or hereafter from time to time during to the continuance of this agreement shall be brought in, stored or to be in or about their premises or godowns at Coimbatore and Medchal or any other godowns to be in course of transit form one godown to another or wherever else the same may be, as security for payment of the balance due to bank by them at any time or ultimately found due on the closing of the said loan accounts.

4. Gist of the terms and conditions and extent

    and operation of the charge.

Interest rate @ PLR – 2.5% - Total 8% for pre and post-shipment and PLR + 3% for Term Loans.

5. Names, address and description of the 

    persons entitled to charge

Punjab National Bank, CMO, Bank Street, Abids, Hyderabad.

6. Date and brief description of instrument

    modifying the charge

8th August 2005

 

  1. Packing Credit Agreement (Hypothecation).
  2. Foreign Outward Usance Bills Purchase Aggrement.

 

  1. Hypothecation of Export Incentives to secure Overdraft facility

 

  1. Hypothecation of Movable Assets forming part of Fixed/Block Assets.

 

  1. General Counter Indemnity for Bank Guarantee Limit.

7. Particular of modification specifying the

    terms and conditions or the extent or   

    operation of the charge in which

    modification is made and the details of

    modification

Amount in Millions

 

 

Existing

Modification

Export Packing Credit (PC/PCFC)

35.000

59.000

FOUBP

40.000

87.000

CEILING

70.000

145.000

 

 

 

Letter of Guarantee

7.500

7.500

OD within FOUBP

(5.000)

(5.000)

 

 

 

Total:

77.500

152.500

 

 

Limit under a) & b) should not be exceed Rs. 145.000 Millions and fully interchangeable both ways:

 

Overall Limit enhanced from Rs. 77.500 Millions to Rs. 152.500 Millions

 

Terms & Conditions:

 

Total Working Capital Limits of Rs. 152.500 Millions are secured by way of:

 

First Charge on the entire Current Assets (Present & Future) of the company primary security in favour of Punjab National Bank , Bank Street, Hyderabad.

 

Second Charge on the entire movable fixed block assets (Present & Future) of the company (Primary & Collateral) weaving division & engineering Division in favour of Punjab National Bank , Bank Street, Hyderabad.

 

1. Export Packing Credit: Rs. 59.000 Millions

Constinuation of the “Running account packing credit facility”

 

Interest: BPLR – 3.25%, presently 7.50% p.a., subject to change from time to time as per Bank/RBI guidelines. Each draw in the PC to be adjusted in 90 days. If the company fail to export goods as envisaged within the stipulated period of 90 days for the date of advance, interest @ 14.25% p.a. from the 91st day to be paid.

 

Margin: 25%

 

2. FOUBP LIMT OF Rs. 87.000 MILLIONS:

 

Sublimit Rs. 15.000 Millions for bills drawn on M/S. Angus International INC., USA

 

Interest: As per Bank guidelines from time to time.

 

USANCE:  As per firm order not exceeding 90 days from the date of shipment in respect of exports and not exceeding 180 days from the date of shipment in respect of shipments to Angus International Inc., USA

 

Margin: NIL

 

Bills not paid with in 30 days form the due date will be delinked and the company to pay the amount at the prevailing exchange rate on the date of delinking.

 

3. OD AGAINST EXPORT INCENTIVES: Rs. 5.000 Millions (Within FOUBP Limit)

 

Interest: As per bank guidelines from time to time

 

Margin: 10%

 

4. LETTER OF GUARANTEE LIMIT OF Rs. 7.500 Millions

 

Margin: 25%

 

Commission: As per bank guildines from time to time.

 

Period: Not exceeding 9 years

 

In case company commits default in repayment of the above loan/advance or in repayment of interest thereon, Bank/RBI will have unqualified right to disclose the name of the company.

 

 

 

CMT REPORT (Corruption, Money Laundering & Terrorism]

 

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

 

1]         INFORMATION ON DESIGNATED PARTY

No 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.40.64

UK Pound

1

Rs.80.44

Euro

1

Rs.54.65

 

 

SCORE & RATING EXPLANATIONS

 

SCORE FACTORS

 

RANGE

POINTS

HISTORY

1~10

5

PAID-UP CAPITAL

1~10

4

OPERATING SCALE

1~10

5

FINANCIAL CONDITION

 

 

--BUSINESS SCALE

1~10

5

--PROFITABILIRY

1~10

4

--LIQUIDITY

1~10

5

--LEVERAGE

1~10

4

--RESERVES

1~10

5

--CREDIT LINES

1~10

4

--MARGINS

-5~5

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

NO

--OTHER MERIT FACTORS

YES/NO

YES

TOTAL

 

46

 

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

 

 

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions