MIRA
INFORM REPORT
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Report Date : |
16.11.2007 |
IDENTIFICATION
DETAILS
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Name : |
EVINIX ACCESSORIES LIMITED |
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Formerly Known As : |
EVINIX FASHION ACCESSORIES PRIVATE LIMITED |
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Registered Office : |
Rammashraya, KH – 43, Sector – 45, Mewla Maharajpur, Faridabad –
121003, Haryana |
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Country : |
India |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
01.05.1996 |
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Com. Reg. No.: |
035494 |
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CIN No.: [Company
Identification No.] |
L74210HR1996PLC035494 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
RTKE00752D |
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PAN No.: [Permanent
Account No.] |
AABCE2573N |
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Legal Form : |
Public Limited Liability Company. Company’s Shares are listed on the
stock exchange. |
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Line of Business : |
Manufacturing and Exports of Bags, Caps and Hats. |
RATING &
COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Maximum Credit Limit : |
USD 2585548 |
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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 : |
Rammashraya, KH – 43, Sector – 45, Mewla Maharajpur, Faridabad –
121003, Haryana |
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Tel. No.: |
91-129-2437109 / 10 |
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Fax No.: |
91-129-2437582 |
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E-Mail : |
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Website : |
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Unit - 1 : |
Evinix Consolidated 14 / 3, Main Mathura Road, Faridabad – 121003, Haryana |
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Tel No.: |
91-129-4040205 |
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Fax No.: |
9-129-2437582 |
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E-Mail : |
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Unit 2 : |
Plot No. 138, NSEZ, Main Dadri Road, Noida – 201305, Uttar Pradesh |
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Tel No.: |
91-120-2562519 / 2562518 / 2562558 |
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Fax No.: |
91-120-2562559 |
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E-Mail : |
DIRECTORS
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Name : |
Mr. Rajeev Taneja |
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Designation : |
Director |
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Address : |
463, Sector 15 – A, Faridabad |
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Date of Birth/Age : |
1960 |
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Name : |
Mr. Puran Chand Kathuria |
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Designation : |
Director |
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Name : |
Mr. Sanjay Taneja |
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Designation : |
Director |
SHAREHOLDING
PATTERN
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Names of Shareholders |
No. of Shares |
Percentage of
Holding |
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(A) Shareholding of Promoter and Promoter Group 2 |
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(1) Indian |
3200000 |
29.91 |
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(B) Institutions Investors |
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(a) Central Government / State Government(s) |
379428 |
3.55 |
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(b) Foreign Institutional |
811975 |
7.59 |
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Sub Total |
1191403 |
11.14 |
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Category |
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(a) Private Corporate Bodies |
4911507 |
45.90 |
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(b) Indian Public |
1269277 |
11.85 |
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© NRIs / OCBs |
3872 |
0.04 |
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(d) Any other clearing members |
123941 |
1.16 |
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6308597 |
58.95 |
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Grand Total |
10700000 |
100.00 |
BUSINESS DETAILS
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Line of Business : |
Manufacturing and Exports of Bags, Caps and Hats. |
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Products : |
˛ Caps ˛ Hats ˛ Wallets ˛ Purses ˛ Coin Purses ˛ Bags ˛ Hats ˛ Cases for PC,
Computer ˛ Ladies Bags ˛ Belts ˛ Home Furnishings ˛ Hard Goods |
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Brand Names : |
˛ GAP ˛ Tommy Kids ˛ Liz Claiborne ˛ Adidas ˛ Cotton Fields ˛ VETIR ˛ Colour Plus ˛ D’PAM ˛ LEE ˛ Arrow ˛ J. CREW |
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Exports : |
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Countries : |
Australia, Singapore, Canada, East Europe, Africa, Asia, Middle East, North America, South America |
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Imports : |
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Countries : |
Hong Kong and Switzerland |
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GENERAL
INFORMATION
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Suppliers : |
˛ Avery Dennison India Private Limited, India ˛ Bostik Findley India Private Limited, India ˛ Madura Coats Limited, India |
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Customers : |
˛ The Gap Inc, USA ˛ Gap Japan K K ˛ Gap Netherland B. V. ˛ GPS Consumer Direct Inc ˛ Polo Jeans Company (Europe) Limited ˛ Polo
Jeans Company, USA |
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No. of Employees : |
450 |
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Bankers : |
Bank of India N.I.T., Faridabad, Haryana |
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Facilities : |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
A.S. Patwa & Company Chartered Accountants |
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Address : |
B – 545, 1st Floor, Nehru Ground NIT, Faridabad – 121001,
Haryana |
CAPITAL STRUCTURE
Authorised Capital :
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No. of Shares |
Type |
Value |
Amount |
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11000000 |
Equity Shares |
Rs.10/- each |
Rs.110.000 millions |
Issued, Subscribed & Paid-up Capital :
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No. of Shares |
Type |
Value |
Amount |
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10700000 |
Equity Shares |
Rs.10/- each |
Rs.107.000
millions |
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
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SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
107.000 |
72.000 |
5.500 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
539.387 |
90.226 |
19.900 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
646.387 |
162.226 |
25.400 |
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LOAN FUNDS |
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1] Secured Loans |
106.102 |
29.910 |
55.300 |
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2] Unsecured Loans |
0.000 |
0.000 |
1.400 |
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TOTAL BORROWING |
106.102 |
29.910 |
56.700 |
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DEFERRED TAX LIABILITIES |
14.790 |
10.899 |
0.000 |
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TOTAL |
767.279 |
203.035 |
82.100 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
138.649 |
83.430 |
25.800 |
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Capital work-in-progress |
32.927 |
28.500 |
0.000 |
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INVESTMENT |
0.000 |
0.000 |
0.000 |
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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 |
165.383
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54.890 |
43.100 |
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Sundry Debtors |
233.923
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87.742 |
45.800 |
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Cash & Bank Balances |
212.987
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8.941 |
2.700 |
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Other Current Assets |
0.000
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0.000 |
0.000 |
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Loans & Advances |
30.294
|
25.496 |
1.200 |
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Total
Current Assets |
642.587
|
177.069 |
92.800 |
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Less : CURRENT
LIABILITIES & PROVISIONS |
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Current Liabilities |
89.708
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86.141 |
35.700 |
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Provisions |
0.000
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0.000 |
1.100 |
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Total
Current Liabilities |
89.708
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86.141 |
36.800 |
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Net Current Assets |
179.416
|
172.282 |
56.000 |
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MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.300 |
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TOTAL |
767.279 |
203.035 |
82.100 |
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PROFIT & LOSS
ACCOUNT
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PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
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Sales Turnover |
682.067 |
469.199 |
286.000 |
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Other Income |
4.638 |
6.331 |
2.400 |
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Total Income |
686.705 |
475.530 |
288.400 |
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Profit/(Loss) Before Tax |
86.107 |
75.138 |
38.300 |
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Provision for Taxation |
21.947 |
17.840 |
0.900 |
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Profit/(Loss) After Tax |
64.160 |
57.298 |
37.400 |
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FOB value of exports |
126.190 |
134.101 |
NA |
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CIF value of import |
10.291 |
20.254 |
NA |
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Expenditures : |
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Manufacturing Expenses |
62.874 |
60.586 |
15.800 |
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Raw Material Consumed |
533.287 |
294.949 |
219.200 |
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Increase/(Decrease) in Finished Goods |
62.659 |
6.050 |
16.900 |
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Personal Expenses |
20.625 |
15.433 |
0.000 |
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Depreciation & Amortization |
5.153 |
3.738 |
1.200 |
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Other Expenditure |
28.364 |
26.197 |
23.300 |
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Total Expenditure |
712.962 |
406.953 |
276.400 |
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QUARTERLY /
SUMMARISED RESULTS
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PARTICULARS |
|
30.06.2007 1st
Quarter |
30.09.2007 2nd
Quarter |
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Sales Turnover |
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212.500 |
322.200 |
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other Income |
|
04.600 |
2.500 |
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Total Income |
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217.100 |
324.700 |
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Total Expenditure |
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175.900 |
255.600 |
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Operating Profit |
|
41.200 |
69.100 |
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Interest |
|
03.900 |
7.100 |
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Gross Profit |
|
37.300 |
62.000 |
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Depreciation |
|
02.100 |
2.100 |
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Tax |
|
08.400 |
6.3000 |
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Reported PAT |
|
26.800 |
53.600 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2007 |
31.03.2006 |
31.03.2005 |
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Debt Equity Ratio |
|
0.17 |
0.46 |
9.07 |
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Long Term Debt Equity Ratio |
|
0.03 |
0.05 |
1.19 |
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Current Ratio |
|
2.62 |
1.28 |
0.89 |
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TURNOVER RATIOS |
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Fixed Assets |
|
5.44 |
7.21 |
9.14 |
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Inventory |
|
6.25 |
9.66 |
8.98 |
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Debtors |
|
4.28 |
7.08 |
8.67 |
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Interest Cover Ratio |
|
7.73 |
14.59 |
6.98 |
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Operating Profit Margin (%) |
|
15.11 |
17.43 |
16.05 |
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Profit Before Interest and Tax Margin (%) |
|
14.37 |
18.65 |
15.63 |
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Cash Profit Margin (%) |
|
10.07 |
12.89 |
13.50 |
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Adjusted Net Capital Employed (5) |
|
9.33 |
12.11 |
13.08 |
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Return on Capital Employed (5) |
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|
21.94 |
66.57 |
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Return on net worth (5) |
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|
15.88 |
558.21 |
LOCAL AGENCY
FURTHER INFORMATION
Fixed Assets:
˛
Land
˛
Factory Building
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Plant and Machinery
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Furniture and Fixtures
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Vehicles
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Office Equipments
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Computer
Directors Reports:
PERFORMANCE OF THE COMPANY
The company
continued to improve its performance on all parameters during the period. The
Company has effectively leveraged its assets, infrastructure and investments,
resulting in improved productivity and performance for the period under review.
The Company
strengthened its position in domestic and international markets further and has
significantly grown its operating profits, with a mixture of top line growth,
effective cost management and right product mix, resulting in Profit After Tax
of Rs. 64.16 million as compared to Rs. 59.06 million in the earlier year.
During the year
under review, gross sales increased to Rs. 686.70 million as compared to
earlier year's Rs.475.53 million, registering a growth of 44.41%. The Operating
profit (PBIT) of the Company increased to Rs. 98.93 million during the year, up
from Rs. 78.78 million in the previous year. Total provision for tax during the
year amounted to Rs. 21.95 million including Rs. 3.89 million towards Deferred
Tax.
EXPANSIONS
The company made
successful acquisition of apparels manufacturing facilities at NSEZ, Noida. The
facility has a modular structure with appropriate infrastructure and utilities.
However, since the facilities were lying unused prior to acquisition, extensive
action on refurbishing the facilities, machines and utilities was undertaken.
As a result of dedicated work put in by the entire production team, the
manufacturing trials began in November 2006 itself with exports commencing from
December, 2006. Today, the unit caters to requirements from world
leaders like The
Children's Place of USA, George of UK, Almunia Textil S.A., Generos de Punto
Lozano S. A., Goher Textil Calella S.A.
Pursuant to the
successful equity offering made by the company in February 2007, substantial
numbers of machines were added to augment the capacities at both Faridabad unit
and NSEZ unit.
INITIAL PUBLIC
OFFER (IPO)
In order to realize its growth plans, the company needed to mobilize
substantial equity funds. To this end, the company entered the
Capital market
with an Initial Public Offer(IPO) of 35,00,000 Equity shares of Rs. 10/- each
through 100% Book Building Route. The subscription list was open from 12th
February 2007 to 15th February 2007 and issue was subscribed by around 3.40
times. The shares were allotted to the successful applicants at a price of Rs.
120/- per equity share (Equity share of Rs. 10/- each issued for cash at a
premium of Rs. 110/- per share), the price finalized in consultation with the
Lead Managers to the issue.
Pursuant to the
successful equity offering and in accordance with the terms of the prospectus,
the company's shares were listed with both the national bourses i.e. Bombay
Stock Exchange (BSE) and National Stock Exchange (NSE). The shares were listed
on 7th March 2007.The
Company acknowledges the overwhelming support of the investor fraternity
in making the equity offering a grand success.
The Company has paid applicable Listing Fees to the above Stock
Exchanges for the year 2007-08.
DEMATERIALISATION OF SHARES
The Company has entered into agreements with the National Securities
Depository Limited (NSDL) and Central Depository Services
(India) Limited (CDSL) for dematerialization of shares of the company.
Company's shares are compulsorily traded in dematerialized form.
INDUSTRY OVERVIEW
The apparel and
textiles industry have been affirmed as the growth centers of Indian economy.
Global trade in textile and clothing industry is currently pegged at around USD
450 bn. With the dismantling of quotas and signing of FT As, the expectations
of the textiles and clothing industry of developing economies are well poised
to capture growth opportunities in the value added garment segment. India and
China are two emerging economies of the world and textile and apparel sector
constitutes a traditional pillar industry of these countries. Significantly,
China is emerging
as a global production hub and India, as a most sought outsourcing destination
for design led value added services and products.
There, exists a
huge potential to tap the Indian fashion design market. By an estimate, the
total lifestyle products including apparel and accessories to footwear,
precious watches and home textiles trade in India is around USD 30 bn. However,
only 4% of the same accounts for branded and fashioned items. Post-MFA
(multi-fibre agreement) era is marked with both opportunities as well as
challenges. India has some
natural advantages to capitalise on, to name a few:
• A strong raw material base;
• Large production capacity (21 % of world spinning capacity and 33% of
world weaving capacity);
• Vast pool of skilled manpower and entrepreneurship;
• Ability to adapt to changes in production process required as per the
product specifications; and
• Long experience with US/EU (European Union) markets.
On the other hand,
the dismantling of quotas has also increased the competition for the Indian
industry. The room for inefficiencies is getting lesser and the burden of
outdated technology in the spinning and weaving sector is now even more
glaring. The Indian textile industry needs to set its house in order to
overcome the traditional weakness of obsolete technology and poor processing
facilities, and leverage its advantage of sk illed manpower and design skills
to make its mark in this high-growth opportunity.
Another factor
that has gone in favour of the Indian industry is the high growth of service
sector, particularly Information Technology and IT Enabled Services. The growth
in these sectors has directly resulted in greater disposable income with the
educated youth that is conscious
of world trends in
fashion. The domestic sector is on the high growth trajectory. The whole
concept of shopping has altered in terms of format and consumer buying
behavior, ushering in a revolution in shopping in India. Modern retail has
entered India as seen in sprawling shopping centers, malls and huge complexes
offer shopping, entertainment and food all under one roof. The Indian
population is witnessing a significant change in its demographics. A large
young working population with median age of 24 years, nuclear families in urban
areas, along with increasing working-women population and emerging
opportunities in the services sector are going to be the key growth drivers of
the organized retail sector in India and in turn the entire fashion accessories
and fashion apparel segment.
SWOT ANALYSIS
Strengths
De-risked business
model - a wide range of innovative fashion accessories & apparels, and
presence in both exports and domestic business thus rendering tremendous
flexibility.
The company
possesses a well equipped production unit with dedicated product specific
manufacturing facilities.
The company has
de-risked its business model by servicing different market segments: men, women
& kids for fashion accessories and women & babies for apparels.
Over the years it
has acquired the expertise to select the high-potential target audience within
each market segment.
Company
consciously strives to ensure that no product segment contributes more than 30%
of total sales to mitigate any product / customer dependency risks.
Strong in-house research, design and development capabilities to improve
its competitiveness in the international markets
Enjoys long
standing business relationships with a prestigious clientele and has serviced
reputed brands overseas.
• In the domestic market, the company also executes license and contract
manufacturing work for reputed brands.
Weakness
• Company does not have processing or coating facilities to value add on
textiles for its special clients.
• Labour hws are not conducive to the industry. Substantial
changes are required for optimum operations.
• The company does not have its own established brand name and depends
on its customers as a contract manufacturer.
• India does not have many trade pacts with other nations, which
restricts its trade growth.
• The productivity of Indian labour is low resulting in part-erosion of
its cost competitiveness.
Opportunities
• The kids' branded apparel and accessories market in India was estimated
at USD 600 million in 2004-05 and is estimated to grow to USD 850 million by
2010, The kids wear market in India stands at almost 15 per cent of the total
apparel market and is poised for an annual growth of nearly 40 per cent.
• Company has imbibed rich knowledge & experience of brand
management and retail selling as Contract manufacturer of various brands. This
offers valuable insights to the company for launching its own brand for the
growing Indian Retail Market.
• The company is well versed with the processes for manufacturing for
other brands. Launch of large international brands in the Indian market will
call for larger local sourcing, which the Company is well placed to take
advantage of.
• The Company can enter other fashion accessories segments such as
fashion jewelry, small leather based products and men's wear leveraging its
strong design skills and understanding of fashion trends.
• Post-MFA, most tariff distortions gradually disappear and firms with
robust capabilities will gain in the global trade of textile and apparel. The
prize is the USD 360 bn market which is expected to grow to about USD 600 bn by
the year 2010.
Threats
• The frequency of change in fashion is increasing thereby exposing the
business to risk of change in customer preferences.
• China has already demonstrated its ability to deliver products at very
competitive prices. It is working hard to increase its pool of skilled manpower
to offer competition in design oriented products too in future.
• Increasing labour costs but poor labour productivity is eroding the
competitiveness of Indian textile industry, which may affect the Company.
Outlook
Indian fashion has
come a long way in the last four decades, creating new business opportunities
for Indian corporate majors and various MNCs that have made steady inroads into
the business of fashion in India. India is beginning to make news worldwide and
Indian fashion extravaganzas are certainly adding more fire to the
building excitement
DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL
PERFORMANCE
The company's
sales increased from Rs. 475.53 million in FY06 to Rs. 686.70 million in FY07.
A new product range of apparels was added to complement the accessories range
provided by the company. The takeover and subsequent refurbishing of the NSEZ
facilities, albeit partially, was carried out successfully for exports to
commence from the new unit in December, 2006.
The company
introduced a range of apparels in the sleepwear segment, maternity wear segment
and children's undergarments during the year. It added Spain and Germany to its
exports markets list. Debenhams and Next, both famous brands from United
Kingdom, were also added during the year under review.
On the domestic front, the company added Puma as customer in India as
its contract manufacturer.
All the additions have a large potential of growth, which is becoming
evident in the current year.
History:
Originally incorporated as EVINIX FASHION ACCESSORIES Private Limited on
- May 1, 1996 under Company Act, 1956,
Subsequently changed its name to EVINIX ACCESSORIES PRIVATE LIMITED on - 20 March 2003 and converted to Public
Limited Company on 3rd Feb 2006
Company Profile:
In 1996 Subject
was incorporated with the object of development and manufacturing of Headgears,
Base Ball Caps and High Altitude Jackets using cotton textile and synthetic
leather. In 1998 company started manufacturing, exporting fashion bags, travel
bags, school bags, wallets, belts and scarves, additionally catering to various
overseas buyers. Expansion was undertaken in year 2000 and started exporting to
GAP (U.S.A), J. Crew, (U.S.A), Country Road, Liz Claiborne, Kookai, Marks &
Spencer, UK etc.
Company was
originally incorporated with the name of Evinix Fashion Accessories Private
Limited under the Companies Act, 1956 and registered with Registrar of
Companies, N.C.T of Delhi and Haryana, Delhi. The name was changed to Evinix
Accessories Private Limited in March 2003. They were converted into a Public
Limited Company vide fresh Certificate of Incorporation dated 3rd Feb 2006
under the name of EVINIX ACCESSORIES LIMITED. The current promoters of the
company are Mr. Raujeev Taneja, Mr. Sanjay Taneja and M/s Ambros Exports
Private Limited.
Subject is a
trusted name in textile based fashion accessories business be it for
international brands or retail brands in India.
Subject has been
moving into world of fashion at a fast pace in the last three years. Today it
is known for its design, technical acumen, quality products and levels
delivered.
Their commitment to serve is complimented by their strong trained human
resource and infrastructure spread over 59036 sq feet in three independent manufacturing
facilities.
Milestones
Achieved
Year Milestones
1996-97 Commenced
operations with imported specialized machinery for base ball caps manufacturing
and embroidery
1997-98 Commenced
Exports of Base Ball Caps to USA
Started Manufacturing & Supply of Sports bags.
Commencement of Export of Sports Bags to USA.
Started Export of Caps to Middle East.
1998-99 Capacity
expansion undertaken with setting up of a factory in Faridabad
2000-01 Conversion
of existing facility at Faridabad into 100% EOU.
Expansion at Faridabad Unit to manufacture Cotton Canvas Bags.
2001-02 Commencement
of Manufacture & Exports of Babies and Kids Accessories.
Awarded for outstanding export performance in Made-ups category by
TEXPROCIL, India.
2002-03 Commenced export
of Leather Belts
2003-04 Commenced
production and exports of Leather Handbags and Wallets
2005-06 Entered
into an Trademark Licensee agreement with Gini & Jony.
Merger of Evinix
consolidate in the company. Merger Company approved by Adidas as Manufacturer
and approved vendor for Apparel and Accessories.
2006-07 Acquired
and started world class Apparel manufacturing unit dedicated to baby &
women fashion wear at Noida Special Economic Zone near New Delhi. Successfully
listed 3,500,000 shares on the Bombay Stock Exchange and National Stock
Exchange, the two largest bourses of the country.
CMT REPORT
(Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts, India Prisons Service,
Interpol, etc.
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or investigation
registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE
GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE
RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.39.35 |
|
UK Pound |
1 |
Rs.80.52 |
|
Euro |
1 |
Rs.59.56 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
6 |
|
OPERATING SCALE |
1~10 |
6 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
5 |
|
--LIQUIDITY |
1~10 |
6 |
|
--LEVERAGE |
1~10 |
6 |
|
--RESERVES |
1~10 |
6 |
|
--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 |
YES |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
54 |
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. |
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 |
|