MIRA
INFORM REPORT
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Report Date : |
13.09.2007 |
IDENTIFICATION DETAILS
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Name : |
MIRZA
INTERNATIONAL LIMITED |
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Formerly Known As : |
MIRZA TANNERS |
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Registered Office : |
14/6, Civil
Lines, |
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Country : |
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Financials (as on) : |
31.03.2006 |
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Date of Incorporation : |
05.09.1979 |
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Com. Reg. No.: |
20-4821 |
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CIN No.: [Company
Identification No.] |
L19129UP1979PLC004821 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
KNPM01745C |
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Legal Form : |
A Public Limited
Liability Company. The company’s shares are listed on the Stock Exchanges. |
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Line of Business : |
Manufacturer and Marketer
of Finished Leather, Full Shoes, Shoe Uppers, Belts/Bags, Sandals, Cotton
Socks and other items. |
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 4250000 |
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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 company having satisfactory track. Trade relations are fair.
Financial position is satisfactory. Payments are usually correct and as per
commitments. The company can
be considered good for any normal business dealings. It can be
regarded as a promising business partners in a medium to long – run. |
LOCATIONS
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Registered Office : |
14/6, Civil
Lines, |
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Tel. No.: |
91-512-2210 672 / 2210 676 / 2210 844 / 2290 775 |
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Fax No.: |
91-512-2210 166 |
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E-Mail : |
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Website : |
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Plants/Marketing Office |
A-7, Mohan
Cooperative Industrial Estate, |
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Plants / Tannery At |
Ř
Tel No : 91-515-2833560 Ř
Tel No : 91-515-2833113 Ř
104-106,
B. M. Market, Juhi, Tel No : 91-512-2650494 Ř
Plot
No. C-4, 5, 36 & 37, Sector – 59, Noida – 201 303, Uttar Pradesh, Tel No : 91-120-2580823 |
DIRECTORS
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Name : |
Mr. Irshad Mirza |
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Designation : |
Chairman and Managing Director |
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Date of Birth/Age : |
69 Years |
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Qualification : |
Leather Technologist |
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Experience : |
43 Years |
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Previous
Employment |
Promoter |
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Name : |
Mr. Rashid Ahmad Mirza |
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Designation : |
Managing Director |
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Date of Birth/Age : |
48 Years |
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Qualification : |
Diploma in Leather Technology, |
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Experience : |
28 Years |
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Date of Appointment : |
05.09.1979 |
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Previous
Employment |
Promoter |
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Name : |
Mr. Tauseef Ahmed Mirza |
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Designation : |
Whole Time Director |
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Date of Birth/Age : |
36 Years |
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Qualification : |
Diploma in Shoe Technology, |
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Experience : |
15 Years |
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Previous
Employment |
Leather Trends Private Limited |
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Name : |
Dr. Yashveer
Singh |
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Designation : |
Director |
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Name : |
Mr. Shahid Ahmad
Mirza |
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Designation : |
Director |
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Name : |
Mr. Pashupati
Nath Kapoor |
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Designation : |
Director |
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Name : |
Mr. Qazi Noorul
Salam |
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Designation : |
Director |
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Name : |
Mr. Taneef Ahmad
Mirza |
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Designation : |
Director |
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Name : |
Mr. N. P.
Upadhyay |
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Designation : |
Director |
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Name : |
Mr. Kuruvila
Kuriakose |
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Designation : |
Director |
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Name : |
Mr. Mohammed
Aslam Khan |
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Designation : |
Director |
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Name : |
Mr. Subhash Sapra
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Designation : |
Director |
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Name : |
Mr. Prem S
Khamesra |
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Designation : |
Whole Time Director |
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Name : |
Mr. S. K. Bajpai |
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Designation : |
Company Secretary |
BUSINESS DETAILS
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Line of Business : |
Manufacturer and Marketer
of Finished Leather, Full Shoes, Shoe Uppers, Belts/Bags, Sandals, Cotton
Socks and other items. |
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Products : |
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Brand Names : |
‘CARVING A
NICHE’, ‘RED TAPE’, ‘OAKRIDGE’, etc. |
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Exports : |
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Countries : |
UK, France, Germany
and in the Scandinavian Countries of Norway, Denmark, Sweden and Finland as
well as South Africa, USA, Canada, Australia, New Zealand and the Middle
East. |
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Imports : |
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Countries : |
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Terms : |
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Purchasing : |
L/C, D/A and D/P
terms |
GENERAL INFORMATION
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Customers : |
v
British
Shoe Corporation (Hush Puppies Division) v
Oliver
Group, v
Clarks
Shoes, |
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No. of Employees : |
800 |
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Bankers : |
Punjab National
Bank, The Mall, |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
Khamesra Bhatia
& Mehrotra Chartered
Accountants |
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Associates/Subsidiaries : |
Leather Trends Private
Limited Line of Business
- Manufacturers of Shoe Uppers & Shoes Shoemac Engineers Line of Business
- Engaged in Shoe Manufacturing & Tannery operations M. M. Shoes Line of Business
- Manufacturers of Leather Sandals MTL Trading (Pty)
Limited 90 Wynne Street,
Parow, Cape Town, South Africa, Private Bag X 23, Parow 7499 Tel. No.: 0027-2193-03601 Fax No.: 0027-2193-01220 E-mail: mtlsa@global.co.za MCF Trading ( 25, Tel. No.: 0044-1908-365398 Fax No.: 0044-1908-365051 E-Mail: mcf.mk2@btinternet.com Line of Business
- Marketing of Leather Products |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
25,000,000 |
Equity Shares |
Rs.10/- each |
Rs.250.000 millions |
|
20,00,0000 |
Cumulative Redeemable Preference Shares |
Rs.100/- each |
Rs.200.000 millions |
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TOTAL |
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Rs.450.000 millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
18540000 |
Equity Shares |
Rs.10/- each |
Rs. 185.400 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 |
185.400 |
185.400 |
162.893 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
923.200 |
859.600 |
659.036 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
1108.600 |
1045.000 |
821.929 |
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LOAN FUNDS |
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1] Secured Loans |
937.900 |
719.900 |
484.302 |
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2] Unsecured Loans |
100.500 |
71.000 |
25.000 |
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TOTAL BORROWING |
1038.400 |
790.900 |
509.302 |
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DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
151.380 |
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TOTAL |
2147.000 |
1835.900 |
1482.611 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
1109.800 |
1074.100 |
970.659 |
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Capital work-in-progress |
125.400 |
75.400 |
0.067 |
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INVESTMENT |
8.100 |
8.600 |
8.461 |
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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 |
983.500
|
893.500 |
572.180 |
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Sundry Debtors |
239.300
|
102.600 |
58.718 |
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Cash & Bank Balances |
17.700
|
119.200 |
79.569 |
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Other Current Assets |
0.000
|
0.000 |
78.368 |
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Loans & Advances |
422.400
|
373.700 |
28.266 |
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Total Current Assets |
1662.900
|
1489.000 |
817.101 |
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Less : CURRENT LIABILITIES & PROVISIONS |
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Current Liabilities |
417.200
|
509.200 |
313.677 |
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Provisions |
342.000
|
302.000 |
0.000 |
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Total Current Liabilities |
759.200
|
811.200 |
313.677 |
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Net Current Assets |
903.700
|
677.800 |
503.424 |
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MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
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TOTAL |
2147.000 |
1835.900 |
1482.611 |
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PROFIT & LOSS
ACCOUNT
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PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
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Sales Turnover [including other income] |
2479.100 |
2710.700 |
17846.800 |
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Profit/(Loss)
Before Tax |
186.400 |
431.300 |
239.658 |
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Provision for
Taxation |
69.000 |
158.000 |
72.040 |
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Profit/(Loss)
After Tax |
117.400 |
273.300 |
167.618 |
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Export Value |
1994.900 |
1474.800 |
1432.343 |
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Import Value |
NA |
NA |
411.126 |
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Total Expenditure |
2470.500 |
2708.800 |
1607.141 |
SUMMARISED RESULTS
|
PARTICULARS |
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|
31.03.2007 [Full Year] |
|
Sales Turnover |
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|
3060.500 |
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Other Income |
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|
5.000 |
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Total Income |
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|
3065.500 |
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Total Expenditure |
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|
2559.300 |
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Operating Profit |
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|
506.200 |
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Interest |
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|
137.900 |
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Gross Profit |
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|
368.300 |
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Depreciation |
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|
82.300 |
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Tax |
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|
101.900 |
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Reported PAT |
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|
181.100 |
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Dividend [%] |
|
|
250.000 |
QUARTERLY RESULTS
|
PARTICULARS |
|
|
30.06.2007 |
|
Type |
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|
1st
Qtr |
|
Sales
Turnover |
|
|
749.800 |
|
Other
Income |
|
|
0.100 |
|
Total
Income |
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|
749.900 |
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Total
Expenditure |
|
|
656.600 |
|
Operating
Profit |
|
|
93.300 |
|
Interest |
|
|
39.600 |
|
Gross
Profit |
|
|
53.700 |
|
Depreciation |
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|
21.000 |
|
Tax |
|
|
11.000 |
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Reported
PAT |
|
|
20.900 |
200706
Quarter 1 –
Expenditure Includes (Increase)/Decrease in stock in Trade
Rs 26.345 million Consumption of Raw Material Rs 439.801 million Staff Cost Rs 44.944
million Other expenditure Rs 145.462 million Tax Includes Provision for Current
Tax Rs 10.400 million Deferred Tax Rs 0.800 million Fringe Benefit Tax Rs 0.680
million EPS is Basic & Diluted Status of Investor Complaints for the
quarter ended June 30, 2007 Complaints Pending at the beginning of the quarter
Nil Complaints Received during the quarter 16 Complaints disposed off during
the quarter 16 Complaints unresolved at the end of the quarter Nil The above
results have been taken on record by the Board of Directors at their meeting
held on July 30, 2007.
KEY RATIOS
|
PARTICULARS |
31.03.2006 |
31.03.2005 |
31.03.2004 |
|
Debt Equity Ratio |
0.85 |
0.70 |
0.73 |
|
Long Term Debt
Equity Ratio |
0.31 |
0.29 |
0.21 |
|
Current Ratio |
1.16 |
1.12 |
1.03 |
|
TURNOVER RATIOS |
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|
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|
Fixed Assets |
1.50 |
1.84 |
1.47 |
|
Inventory |
2.35 |
3.31 |
2.95 |
|
Debtors |
12.90 |
30.11 |
35.37 |
|
Interest Cover
Ratio |
3.63 |
10.50 |
6.66 |
|
Operating Profit
Margin (%) |
15.04 |
22.37 |
19.61 |
|
Profit Before Interest
and Tax Margin (%) |
11.67 |
19.63 |
16.15 |
|
Cash Profit
Margin (%) |
8.69 |
14.00 |
13.06 |
|
Adjusted Net
Profit Margin (%) |
5.32 |
11.25 |
9.60 |
|
Return on Capital
Employed (%) |
12.92 |
30.10 |
19.90 |
|
Return on Net Worth (%) |
10.90 |
29.28 |
20.50 |
STOCK PRICES
|
Face Value |
Rs.10/- |
|
High |
Rs.164.95/- |
|
Low |
Rs.155.20/- |
LOCAL AGENCY FURTHER INFORMATION
History
Mirza
Tanners (MTL), promoted by Irshad Mirza and Rashid Mirza in 1979 is into
manufacture of finished leather, shoe uppers, shoes and leather accessories.
The company tapped the capital market in Sep 1994.
The company to set up a factory to manufacture 0.600 Millions pairs of shoe
uppers and 0.450 Millions pairs of shoes
pa at Shahjani-Unnao, Uttar Pradesh, to increase the capacity of the tannery
units from 5.000 Millions sq ft to 6.000 Millions sq ft of finished leather pa
at Magarwara-Unnao, Uttar Pradesh.
MTL has established itself as a high-quality shoes supplier catering to the
premium segment of the market. It has supplied shoes to the Hush Puppies
division of British Shoe Corporation and to reputed brand names -- Oliver
Timpson of the Oliver group,
About 85% of the shoes manufactured by the company are exported. It has
commenced sale of footwear under its own brands Red Tape and Oakridge and these
have received encouraging response.
Having established a national presence in the country, Red Tape, the flagship
brand of Mirza Tanners Limited, is on an aggressive expansion drive adding new
styles and exploring new markets in 2001.
The Company bagged three export awards from the Council for Leather Exports for
outstanding export performance for the year 1999-2000. After the successful
launching of Double Density PU shoes, the company added a second plant at its
Noida Factory doubling the capacity. The Company is expecting a substantial increase
in this new range of footwear. During 2001-02 the company issued on private
placement basis, Secured Redeemable NCD with a face value of Rs.50.000
Millions.
MTL is contemplating of restructuring of Group operations and has appointed
Price Waterhouse Coopers (Private) Limited to examine various options.
The company has
two segments of business namely :-
Tannery Division : Marketing Finished leather from Raw hides Wet Blue
Shoe Division : Manufacturing Finished Leather Shoes.
PERFORMANCE OF THE COMPANY
During the year under review, the Company continued its impressive
performance. Gross Income of Rs. 2564.300 Millions registered a growth of 36
percent as against Rs.1881.900 Millions in the previous year. The operating
profit before depreciation and interest has shown a growth of 50 percent and
reached to Rs. 515.100 Millions as against Rs. 342.300 Millions in the previous
year. After charging a higher interest of Rs. 42.700 Millions (Rs. 42.300
Millions) and depreciation of Rs. 63.800 Millions (Rs. 60.400 Millions) and
providing for tax Rs. 131.200 Millions (Rs. 50.500 Millions) and deferred tax
liability of Rs. 18.400 Millions (Rs. 21.500 Millions), the company has earned
a profit after tax of Rs.259.000 Millions as against Rs. 167.600 Millions in
the previous year. After making prior year adjustments, the net profit of the
company has jumped to Rs.260.900 Millions as against Rs.109.600 Millions in the
previous year registering a growth of 138 percent.
DIVIDEND
The Company has already paid an Interim Dividend of 30 percent i.e. Rs.3/- per
equity share aggregating to Rs. 48.800 Millions for the financial year ended
31st March, 2005.
Keeping in view of the improved profitability as well as expansion prorgramme
of the company, the Board of Directors is pleased to recommend a final dividend
of 20 percent i.e. Rs. 2/- per equity share for the year ended 31st March,
2005, subject to the approval of shareholders making a total payout of 50
percent i.e. Rs. 5/- per equity share for the year 2004-05.
EXPANSION PROGRAMME
The Company has achieved saturation of its existing manufacturing capacities
and has chalked out an ambitious expansion plan to double its tanning and
footwear manufacturing capacities. Over the next two years the company plans to
incur a substantial capital expenditure towards this objective. As a first
step, 70 acres of land has been acquired at Unnao for enhancement of tanning
capacities and 20 acres at Greater Noida for setting up an integrated world
class footwear manufacturing centre both for ladies & men's footwear and a
state of the art R & D centre.
CORPORATE GOVERNANCE
The
company has been practicing the principles of good corporate governance and the
board of directors lays strong emphasis on transparency, accountability and
integrity.
A separate report on Corporate Governance together with a certificate from
Statutory Auditors confirming compliance with corporate governance requirement
as stipulated in Clause 49 of the listing agreement with the stock exchange has
been annexed as part of this report.
MANAGEMENT DISCUSSION AND ANALYSIS
Industry structure and developments
Indian leather industry is gradually coming out of its traditional unorganized
form and more and more individual units are now engaging into good practices
resulting into better quality of products, less damage to environment and
higher efficiency of operations. With the largest population of livestock in
the world,
Opportunities, Threats, Risks & Concerns
Having
established a strong presence in
Economic showdown in European & U.S. economies, competition from China
which continues to artificially value its currency to levels highly inclined in
favour of its exporters, impact of global terrorism actions, lack of proper infrastructure
in line with global trade requirements, indifferent government policies,
increasing fuel prices and weakening of currencies are some of the threats
faced by the company.
Outlook
The Company's main focus right now is strengthening of the brands in domestic
and International market and developing strategies for penetration into high
growth markets and their focus in the future will be on the high growth retail
segment in
DOMESTIC SALES
During the year under review, domestic sales of shoes has also recorded a
significant increase of 59 percent and reached to Rs. 428.300 Millions as
against Rs. 270.900 Millions.
The company's brand 'Red Tape' is being marketed more aggressively in
SCHEME OF AMALGAMATION
During the year, a Scheme of Amalgamation has been filed in the Honourable High
Court of Allahabad for the amalgamation of Leather Trends Private Limited with
the company. The Scheme has been approved by the shareholders and Creditors of
both the companies and Company Petition has been filed in the Honourable High
Court seeking sanction of the Scheme of Amalgamation.
CHANGE OF NAME
Considering the nature of business of the company, the name of the company is
being changed to Mirza International Limited subject to final approval of the
central Govt. in terms of Sec. 21 of the Companies Act, 1956.
Fixed Assets
- Buildings
- Machinery
- Effluent Treatment Plant
- Tools & Shoe Lasts
- Furniture, Fittings & Electric
Installation
- Motor Vehicles
- Computers
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No available
information exist that suggest that subject or any of its principals have been
formally charged or convicted by a competent governmental authority for any
financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.40.44 |
|
|
1 |
Rs.82.01 |
|
Euro |
1 |
Rs.56.20 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
6 |
|
OPERATING SCALE |
1~10 |
6 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
6 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--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 |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
55 |
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 |
|