MIRA INFORM REPORT
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Report Date : |
29.10.2007 |
IDENTIFICATION DETAILS
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Name : |
EMAMI
LIMITED |
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Registered Office : |
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Country : |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
11.03.1983 |
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Com. Reg. No.: |
21-36030 |
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CIN No.: [Company Identification No.] |
L63993WB1983PLC036030 |
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TAN No.: [Tax Deduction & Collection Account
No.] |
CALE01693G |
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PAN No.: [Permanent Account No.] |
AAACH7412G |
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Legal Form : |
Subject is a public limited liability company. The company’s shares are listed in the Stock Exchanges. |
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Line of Business : |
Manufacturing and Marketing of personal
and healthcare products. |
RATING
& COMMENTS
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MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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|
56-70 |
A |
Financial
& operational base are regarded healthy. General unfavourable factors
will not cause fatal effect. Satisfactory capability for payment of interest
and principal sums |
Fairly Large |
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Maximum Credit Limit : |
USD
9200000 |
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Status : |
Good |
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Payment Behaviour : |
Usually
correct |
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Litigation : |
Clear |
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Comments : |
Subject
is a well established company having satisfactory track. Trade relations are fair. Financial
position is good. The company is doing
well. Its payments are usually correct and as per commitments. The
company can be considered good for any normal business dealings at usual
trade terms and conditions. It can be
regarded as a promising business partner in a medium to long run. |
LOCATIONS
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Registered Office : |
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Head Office : |
Stephen House, 6-A, |
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Tel. No.: |
91-33-22487651/54/22486035/29/22482679 |
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Fax No.: |
91-33-22481568/22100879 |
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E-Mail : |
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Website : |
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Corporate
Office : |
18, |
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Tel.
No.: |
91-33-248-2679/2748/4416/9602/5190/7281/7284/6064 |
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Fax
No.: |
91-33-2482773/2106 |
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E-Mail
: |
emami@vsnl.com |
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Factory
: |
J.D.Lane, Kolkata, 48B, 3 Units at
Mettupalayam, |
DIRECTORS
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Name : |
Mr. R. S. Agarwal |
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Designation : |
Executive
Chairman |
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Name : |
Mr. R. S. Goenka |
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Designation : |
Director
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Name : |
Mr. Sushil Kumar Goenka |
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Designation : |
Managing Director |
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Name : |
Mr. K. K. Kherma |
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Designation : |
Director |
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Name : |
Mr.
Viren J. Shah |
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Designation : |
Director |
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Name : |
Mr. S.
N. Jalan |
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Designation : |
Director
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Name : |
Ms.
Vaidya S. Chaturvedi |
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Designation : |
Director
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Name : |
Mr.
Mohan Goenka |
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Designation : |
Whole
Time Director |
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Name : |
Mr. A.
V. Agarwal |
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Designation : |
Whole
Time Director |
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Name : |
Mr. H.
V. Agarwal |
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Designation : |
Whole
Time Director |
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Name : |
Mr. S.
K. Todi |
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Designation : |
Director
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Name : |
Mr. K.
N. Memani |
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Designation : |
Director
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KEY
EXECUTIVES
|
Name
: |
Mr. A. K. Joshi |
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Designation
: |
Company Secretary |
MAJOR
SHAREHOLDERS / SHAREHOLDING PATTERN
As on 30.09.2007
|
Names
of Shareholders |
No. of Shares |
Percentage of Holding |
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PROMOTER
HOLDING |
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Indian
Promoters |
54591253 |
87.84 |
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Sub – Total |
54591253 |
87.84 |
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NON
PROMOTERS HOLDINGS |
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Institutional
Investors n
Banks / Financial Institutions / Insurance n
Fiils |
1285 1071810 |
-- 1.72 |
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Sub – Total |
3056730 |
4.92 |
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OTHER
INVESTORS |
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Private
Corporate Bodies |
2973490 |
4.78 |
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NRI’s
/ OCB’s / Foreign Others |
7264 |
0.01 |
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Sub – Total |
2980754 |
4.80 |
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General
Public |
1516440 |
2.44 |
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GRAND TOTAL |
62145177 |
100.00 |
BUSINESS
DETAILS
|
Line of Business : |
Manufacturing and Marketing of personal
and healthcare products. |
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Products : |
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GENERAL INFORMATION
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No. of Employees : |
1000 |
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Bankers : |
Canara Bank ICICI Bank Limited State Bank of UTI Bank Limited |
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Banking Relations : |
Satisfactory
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Auditors : |
Sexena and Company Chartered Accountants |
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Associates : |
Diwakar Viniyog
Private Limited Suntrack Commerece
Private Limited Emami Paper Mills
Limited DPS Technologies
India Private Limited |
CAPITAL STRUCTURE
Authorised
Capital :
|
No.
of Shares |
Type |
Value |
Amount |
|
12500000 |
Equity Shares |
Rs.
10/- each |
Rs. 125.000 millions |
|
250000 |
Preference Shares |
Rs.
100/- each |
Rs. 25.000 millions |
|
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TOTAL |
|
Rs. 150.000
millions |
Issued,
Subscribed & Paid-up Capital :
|
No.
of Shares |
Type |
Value |
Amount |
|
12429035 |
Equity Shares |
Rs.
10/- each |
Rs. 124.300 millions |
FINANCIAL
DATA
[all figures are in Rupees Millions]
ABRIDGED
BALANCE SHEET
|
SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
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1] Share Capital |
124.300 |
122.300 |
122.300 |
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2] Reserves & Surplus |
2169.900 |
3229.900 |
3046.100 |
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NETWORTH |
2294.200 |
3352.200 |
3168.400 |
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LOAN FUNDS |
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1] Secured Loans |
228.100 |
312.400 |
337.600 |
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2] Unsecured Loans |
26.100 |
9.300 |
9.800 |
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TOTAL BORROWING |
254.200 |
321.700 |
347.400 |
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TOTAL |
2548.400 |
3673.900 |
3515.800 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
468.000 |
1931.700 |
2145.900 |
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Capital work-in-progress |
344.900 |
92.800 |
40.500 |
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INVESTMENT |
781.800 |
871.000 |
539.100 |
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CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
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Inventories |
412.000
|
366.200
|
367.500 |
|
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Sundry Debtors |
457.700
|
366.800
|
352.500 |
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|
Cash & Bank Balances |
184.200
|
8.200
|
3.400 |
|
|
Loans & Advances |
560.000
|
468.000
|
322.100 |
|
Total Current Assets |
1613.900
|
1209.200
|
1045.500 |
|
|
Less : CURRENT LIABILITIES & PROVISIONS |
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|
|
|
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|
Current Liabilities |
483.900
|
244.700
|
185.500 |
|
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Provisions |
176.300
|
186.100
|
69.700 |
|
Total Current Liabilities |
660.200
|
430.800
|
255.200 |
|
|
Net Current Assets |
953.700
|
778.400
|
790.300 |
|
|
|
|
|
|
|
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TOTAL |
2548.400 |
3673.900 |
3515.800 |
|
PROFIT
& LOSS ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
Sales
Turnover |
5192.200 |
3073.700 |
2255.600 |
|
|
Other Income |
136.100 |
38.100 |
53.700 |
|
|
Total
Income |
5328.300 |
3111.800 |
2309.300 |
|
|
|
|
|
|
|
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Profit/(Loss)
Before Tax |
744.900 |
503.100 |
315.200 |
|
|
Provision
for Taxation |
85.700 |
9.400 |
20.300 |
|
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Profit/(Loss)
After Tax |
659.200 |
493.700 |
294.900 |
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Expenditures : |
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Manufacturing Expenses |
31.100 |
20.900 |
21.700 |
|
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Administrative Expenses |
1759.900 |
450.300 |
352.600 |
|
|
Raw Material Consumed |
2251.500 |
1735.900 |
1295.700 |
|
|
Excise Duty |
34.300 |
64.900 |
67.700 |
|
|
Salaries, Wages, Bonus, etc. |
219.600 |
144.700 |
108.900 |
|
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Interest |
10.800 |
14.100 |
20.000 |
|
|
Power & Fuel |
11.500 |
12.000 |
10.300 |
|
|
Depreciation & Amortization |
46.500 |
66.900 |
29.800 |
|
|
Other Expenditure |
218.200 |
99.000 |
87.400 |
|
Total
Expenditure |
4583.400 |
2608.700 |
1994.100 |
|
QUARTERLY
RESULTS
|
PARTICULARS |
|
|
30.06.2007 [1st Quarter] |
|
Sales Turnover |
|
|
1050.400 |
|
Other Income |
|
|
2.400 |
|
Total Income |
|
|
1052.800 |
|
Total Expenditure |
|
|
944.600 |
|
Operating Profit |
|
|
108.200 |
|
Interest |
|
|
(17.300) |
|
Gross Profit |
|
|
125.500 |
|
Depreciation |
|
|
14.400 |
|
Tax |
|
|
13.500 |
|
Reported PAT |
|
|
98.900 |
KEY
RATIOS
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt
Equity Ratio |
0.18 |
0.38 |
0.65 |
|
Long
Term Debt Equity Ratio |
0.10 |
0.27 |
0.55 |
|
Current
Ratio |
2.13 |
2.56 |
3.78 |
|
TURNOVER
RATIOS |
|
|
|
|
Fixed
Assets |
6.83 |
3.73 |
2.79 |
|
Inventory
|
13.34 |
8.38 |
6.66 |
|
Debtors |
12.59 |
8.55 |
5.69 |
|
Interest
Cover Ratio |
69.97 |
36.68 |
16.76 |
|
Operating
Profit Margin (%) |
15.45 |
19.00 |
16.18 |
|
Profit
Before Interest and Tax Margin (%) |
14.55 |
16.83 |
14.86 |
|
Cash
Profit Margin (%) |
13.59 |
18.24 |
14.40 |
|
Adjusted
Net Profit Margin (%) |
12.70 |
16.06 |
13.07 |
|
Return
on Capital Employed (%) |
39.40 |
42.78 |
34.26 |
|
Return
on Net Worth (%) |
40.46 |
56.46 |
49.68 |
LOCAL AGENCY FURTHER INFORMATION
The registered office of the Company has been shifted from Stephen House, 6A, RN Mukherjee Road, Kolkata 700 001 to the newly-constructed corporate house of the Company at Emami Tower, 687, Anandapur, Kasba Golpark, EM Bypass, Kolkata 700 107. All the departments of the Company have been shifted to the corporate office. A unified corporate office will help to further integrate business processes and leverage scale and synergies across the organization.
History
:
In the Seventies, Kolkata based
industrialists Mr. R S Agarwal and Mr. R S Goenka jointly promoted the business of Himani
Limited. Over the last three decades, Himani has not only emerged as a leading
player in the field of personal and health care products in
The company is headquartered in Kolkata
with a multi locational manufacturing presence in Kolkata,
During the year 1995 the company increased the installed capacity of medicines
from 1440 MT to 1760 MT. During the same year the company initiated steps for
modernisation and technological upgradation in order to combat competition and
retain its market share.
Kolkata High Court has sanctioned the Scheme of Amalgamation. Accordingly Emami
Limited has been amalgamted with Himani Limited with effect from 1st
April, 1998. Board has allotted 8,86,000 equity shares of the company to the
Emami Limited, as per amalgamation. Company's name has been changed from
"Himani Limited" to "Emami Limited" as on 1st
September 1998.
The company has expanded the installed capacity of Medicine during the year 2002-03 by 1000 MT and with this expansion the total capacity has been increased to 15261 MT.
The total capacity of Toiletries, Medicines and Food products at the end of
financial year 2002-03 are 2391.70 MT, 15261 MT & 500 MT respectively.
MILESTONES
In the year 1978 Himani Limited a 70-year-old company was acquired. Today the successful Boroplus Cream is from Himani, a pioneer in herbal cosmetics in the country. After years of experimentation, Boroplus Antiseptic Cream was launched.
Sensing success in the field of plastics, the Group incorporated Classic Plastics Private Limited, which manufactures blow moulding containers and bottles for the cosmetics industries and jerry cans for oil companies.
Due to Emami’s overwhelming success in
The Emami Group has taken a giant step into a field not ventured by them so far – the field of medicine. The former Frank Ross Limited is now a member of the Emami Group, and manufactures ethical life saving drugs.
CRI Limited today is recognized as the leader in
manufacturing Tips and Refills for ball Point Pen in
Capitalizing Exports on the liberal economic policy of
the Government of India, the Emami Group is making successful ventures into the
foreign market with increased momentum. The Emami Group has overseas
representation in the following countries such as
· Personal and Health Care
· Paper
· CRI Tips
· Wright Pens
· Marketing Activities
· Hospital
· Shopping Centres
Amalgamation of JB
Marketing and Finance Limited with the Company:
The scheme of
amalgamation of JB Marketing & Finance Limited (JBMF) with the Company has
been approved by the Hon'ble Calcutta High Court on 23rd February, 2007.
Pursuant to the said scheme of amalgamation, 9,95,177 equity shares of Emami
Limited were allotted to the shareholders of JBMF on 24th April, 2007, being
the record date. The amalgamation has helped the Company achieve the benefits
of vertical integration as JBMF was engaged in the business of marketing and
selling the Company's products through its extensive domestic network.
Review of operations:
With GDP growth in excess of 9%,
Almost all brands have
grown faster than the category growth.
Since Emami's
financial results for the financial year 2006-07 also include the performance
of the amalgamating company, JBMF, they are not comparable with the previous year's
figures. However, if the previous year's figures are consolidated for
comparison purpose, then the net sales at Rs. 516 cr and PAT at Rs. 66 cr
reflect growth of 26% and 33% respectively.
Emami's continuous endeavour of providing innovative, effective and
value-for-money products based on ayurveda, using modern laboratory practices
has helped deliver better results. Equipped with strong power brands and
coupled with innovative new launches, Emami is poised for continuous business
growth. Your Board therefore takes optimistic view of the future.
Further, while Emami Limited is on the lookout for acquisitions in
Industry Overview:
The Indian FMCG sector
is valued at around USID 13.1 bn and expected to grow to USID 17.4 bn by 2010.
The overall consumer market growth was 12%-plus in 2006 and is expected to stay
buoyant in 2007, backed by robust demand across various product categories.
For detailed discussions on industry growth, opportunity and challenges, please
refer to page 18 of this report.
The Company's operational performance:
The Company sustained its robust growth through brand rejuvenation and
successful launches in health and personal care products. Today, Emami is a
major player in the country's health, personal and beauty care segments.
Sales wise, its
Navratna Oil is the biggest brand that enjoys a 55% market share. Despite being
the premium oil, the brand almost doubled its sales in the last three years, a
reflection of not just its superior price-value proposition but also consumer
endorsements over competing brands. The Company's Boroplus Antiseptic Cream
further strengthened its leadership position with 70% market share.
With brands such as Boroplus, Navratna, Sona Chandi, Menthoplus, Fast Relief
and Fair & Handsome, Emami is present in profitable niche FMCG segments
(cooling oils, antiseptic creams, fairness creams, chyawanprash, prickly heat
powder, rubificients and pain relief) with a focus on aspirational categories
like personal care, health and grooming.
Emami's innovative R&D, aggressive marketing, penetrating distribution,
stringent quality controls, stronger procurement and operational efficiencies,
young and responsive team and online information systems are driving Emami to
newer heights and enabling it to win trust of 1.1 billion consumers
Besides, the various brand promotion activities
conducted by the Company comprised:
* Introduction of attractive packaging with changing consumer preferences
enhancing customer appeal
* Tie-ups with TV channels leading to a larger viewership
* Increasing product visibility through prominent display at shopping malls and multiplexes and in-shop
promotions through danglers and posters
* Live demonstration and product promotions in schools
* Participation in rural fairs, exhibitions, rural audio visual vans, trade merchandising and contact
programmes across the length and breadth of the country
* Organisation of innovative consumer
promotion programmes through the on-pack and in-pack route
Emami's distribution network ensures anytime availability of its brands across the country.
Emami's distribution network - 24 depots, 2,600 distributors, and 400,000
retail outlets - ensure that retailers never run out of stock and customers
never return empty handed. To enhance the effectiveness of its distribution,
the Company merged J.B. Marketing and Finance Ltd, its marketing company, with
itself during the year under review.
Emami segregated its sales channels as per the changing requirement of urban
and rural markets; while the products in the rural markets were promoted
through Emami Mobile Traders, Emami small village shops, ITC e-choupal and the
country's postal network, the urban markets were serviced through a modern
trade channel that targeted customers in shopping malls and lifestyle outlets
directly or through specialised distributors in addition to the regular retail
network.
To strengthen its distribution, Emami entered into agreements with various
state governments; an agreement with the
WEBSITE DETAILS
Emami Limited is in the business of manufacturing personal, beauty and health
care products. The company manufactures herbal and Ayurvedic products through
the use of modern scientific laboratory practices. This blend enables the
company to manufacture products that are mild, safe and effective. The
company's product basket comprises over 20 products, the major being Boroplus
Antiseptic Cream, Navratna Oil, Bororplus Prickly Heat Powder, Sona Chandi
Chyawanprash and Amritprash, Mentho Plus Pain Balm, Fast Relief, Golden Beauty
Talc, Madhuri Range of Products and others. The products are sold across all
states in
Manufacturing
Emami's
products are manufactured in Kolkata,
Network
The company's
dispersed manufacturing facilities are complemented with a strong product
throughput, facilitated by a robust distribution network of over 2100 direct
distributors and 0.390 million retail outlets. With a view to reach its
products deeper into the country, direct selling has been extended to rural
villages. As a result, rural sales increased substantially in 2003-04 compared
to the previous year.
Emami is headquartered in
Kolkata. The company's branch offices are located across 27 cities in
Promoters
Emami is
promoted by Shri R. S. Agarwal and Shri R. S. Goenka, Kolkata based
industrialists.
Emami's shares are listed on the Calcutta Stock Exchange and Bombay Stock
Exchange.
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.39.51 |
|
|
1 |
Rs.81.61 |
|
Euro |
1 |
Rs.56.76 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
8 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
8 |
|
--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 |
|
72 |
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 |
|