MIRA
INFORM REPORT
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Report Date : |
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IDENTIFICATION DETAILS
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Name : |
NTPC VIDYUT VYAPAR NIGAM LIMITED |
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Registered Office : |
NTPC
Bhawan, SCOPE Complex 7, Institutional Area, |
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Country : |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
01.11.2002 |
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Com. Reg. No.: |
117584 |
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CIN No.: [Company
Identification No.] |
U40108DL2002GOI117584 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
DELN05873A |
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PAN No.: [Permanent
Account No.] |
AABCN7433J |
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Legal Form : |
A
Closely Held Public Limited Liability Company. |
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Line of Business : |
Trading and Electric Power and Fly Ash and Ash based products |
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 1000000 |
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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 records. Directors are reported as experience 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 : |
NTPC
Bhawan, SCOPE Complex 7, Institutional Area, |
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Tel.
No.: |
91-11-24361557/24361012/24360100
(10 Lines) |
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Fax
No.: |
91-11-24368417/24361018 |
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E-Mail
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Website
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DIRECTORS
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Name : |
Mr. A. K. Singhal |
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Designation : |
Director |
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Name : |
Mr. T. Sankaralingam |
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Designation : |
Chairman |
KEY EXECUTIVES
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Name : |
Mr. Nitin Mehra |
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Designation : |
Secretary |
BUSINESS DETAILS
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Line of Business : |
Trading and Electric Power and Fly Ash and Ash based products |
GENERAL INFORMATION
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Bankers : |
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Facilities : |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
Rohtas and Hans Chartered Accountants |
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Associates/Subsidiaries : |
Ř
Pipavav Power Development Company Limited Ř
Gujarat Power Corporation Limited Ř
NTPC Electric Supply Company Limited Ř
NTPC Hydro Limited Ř
Vaishali Power Generating Company Limited |
CAPITAL STRUCTURE
Authorised Capital :
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No. of Shares |
Type |
Value |
Amount |
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2,00,00,000 |
Equity Shares |
Rs. 10/- each |
Rs. 200.000 Millions |
Issued, Subscribed & Paid-up Capital :
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No. of Shares |
Type |
Value |
Amount |
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2,00,00,000 |
Equity Shares |
Rs. 10/- each |
Rs. 200.000 Millions |
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
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SOURCES OF FUNDS |
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31.03.2007 |
31.03.2006 |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
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200.000 |
200.000 |
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2] Share Application Money |
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0.000 |
0.000 |
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3] Reserves & Surplus |
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73.569 |
59.037 |
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4] (Accumulated Losses) |
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0.000 |
0.000 |
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NETWORTH |
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273.569 |
259.037 |
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LOAN FUNDS |
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1] Secured Loans |
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0.000 |
0.000 |
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2] Unsecured Loans |
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50.807 |
0.000 |
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TOTAL BORROWING |
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50.807 |
0.000 |
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DEFERRED TAX LIABILITIES |
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0.143 |
0.444 |
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TOTAL |
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324.519 |
259.481 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
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1.704 |
2.519 |
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Capital work-in-progress |
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0.000 |
0.000 |
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INVESTMENT |
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0.000 |
0.000 |
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DEFERREX TAX ASSETS |
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0.000 |
0.000 |
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CURRENT ASSETS, LOANS & ADVANCES |
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Inventories |
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4.589 |
7.437 |
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Sundry Debtors |
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279.045 |
242.649 |
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Cash & Bank Balances |
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655.901 |
322.307 |
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Other Current Assets |
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2.096 |
0.158 |
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Loans & Advances |
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0.035 |
6.823 |
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Total
Current Assets |
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941.666 |
579.374 |
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Less : CURRENT
LIABILITIES & PROVISIONS |
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Current Liabilities |
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595.249 |
310.962 |
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Provisions |
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23.602 |
11.450 |
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Total
Current Liabilities |
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618.851 |
322.412 |
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Net Current Assets |
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322.815 |
256.962 |
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MISCELLANEOUS EXPENSES |
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0.000 |
0.000 |
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TOTAL |
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324.519 |
259.481 |
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PROFIT & LOSS
ACCOUNT
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PARTICULARS |
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31.03.2007 |
31.03.2006 |
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Sales Turnover |
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8593.961 |
4343.829 |
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Other Income |
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214.449 |
97.563 |
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Total Income |
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8808.410 |
4441.392 |
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Profit/(Loss) Before Tax |
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96.609 |
50.675 |
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Provision for Taxation |
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31.490 |
17.405 |
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Profit/(Loss) After Tax |
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65.119 |
33.270 |
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Expenditures : |
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Power purchase |
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8491.526 |
4267.172 |
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Open Access
Charges |
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2.453 |
4.298 |
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Consumption of
Ash/Ash Products |
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9.272 |
0.073 |
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Ash/Ash products'
trading & selling Expenses |
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0.444 |
0.055 |
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Employees'
remuneration and benefits |
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39.945 |
26.683 |
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Administration
& Other Expenses |
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9.295 |
7.847 |
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Rebate on power
sale |
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138.021 |
83.068 |
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Provision for rebate
on power sale |
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18.972 |
0.000 |
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Depreciation |
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0.753 |
0.454 |
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Provision for
obsolete Inventory |
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0.710 |
0.000 |
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Interest and finance charges |
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0.408 |
1.066 |
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Total Expenditure |
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8711.799 |
4390.716 |
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KEY RATIOS
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PARTICULARS |
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31.03.2007 |
31.03.2006 |
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PAT / Total Income |
(%) |
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0.74 |
0.73 |
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Net Profit Margin (PBT/Sales) |
(%) |
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1.12 |
1.17 |
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Return on Total Assets (PBT/Total Assets} |
(%) |
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10.24 |
8.71 |
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Return on Investment (ROI) (PBT/Networth) |
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0.35 |
0.20 |
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Debt Equity Ratio (Total Liability/Networth) |
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2.45 |
1.24 |
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Current Ratio (Current Asset/Current Liability) |
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1.52 |
1.80 |
LOCAL AGENCY FURTHER INFORMATION
POWER
TRADING-BUSINESS
In accordance to
Central Electricity Regulation Commission (CERC) notification the Company was granted
a trading license that was upgraded to T' category in the year 2004-05 and the
Company has retained the same category during the current year 2006-07.
During the year
under review the company had traded 2664.35 MU amounting to Rs. 8594 million as
compared to 1643.30 MU of electricity amounting to Rs.4344 million in the year
2005-06.
NEW BUSINESS
INITIATIVES
The new business
initiative for sale of Fly ash and Cenosphere were started during the year
2005-06. The Company has been successful in exporting 14798 MT of Ash on F.O.B.
vizag basis at a total price of US$ 0.04 million (Rs. 18 million
approximately).
The domestic sale
of Cenosphere is being conducted through E-auction portal of MSTC Limited, a
public sector company and 95 MT has been sold successfully during the year for
the sale value of Rs. 2 million (approximately).
POWER EXCHANGE AT
NATIONAL LEVEL
On behalf of the
holding Company, the company had appointed a Consortium of Consultants viz. M/S
CRISIL Limited and M/s
MANAGEMENT
DISCUSSION AND ANALYSIS
INDUSTRY STRUCTURE
AND DEVELOPMENTS
Today
Trading can be
inter-state or intra-state and the appropriate regulatory commission is to fix
the eligibility criteria for a trader. Central Electricity Regulatory
Commission (CERC) issued its order and regulations regarding the grant of
license for inter state trading in January 2004.
Presently CERC has
fixed a trading margin of 4 paisa per Kwh for electricity traders. During the
last three years, 22 traders have obtained licenses for serving the needs of
the various clients. The traders are issued license under various categories
starting from A,B,C,D,E,F depending on the volume of units traded. During
2006-07, out of the total electricity generation of approximately 625 billion
units, approximately 15 billion units were traded representing 2.41 % of
trading to total generation. Over the year there was an annual growth of 6%
from a level of 14 billion units traded during 2005-06.
Open access
regulations have also facilitated power trading in an orderly manner as it
allows non-discriminatory access in using transmission system. With the
amendment of the Open Access Regulations dated 21st February 2005, flexibility
of transactions have significantly increased in terms of day-ahead and intraday
trading of electricity, which lead to improved utilization of sparse generation
and transmission capacities.
Carrying forward,
the open access regulations have also been notified by the State regulators to
provide access of cheaper power to consumers within the States in the phased
manner.
With the
acceleration in the trading activities, the surplus power of the order of 1000-1200
MW in the Eastern Region and North Eastern Region has been fruitfully utilized
in the other deficit regions, through the inter-regional transmission links.
The National Electricity Policy notified in January 2006, mandates the creation
of power exchange to facilitate develop a better price discovery mechanism for
buyers as well sellers of electricity. The power exchange shall provide a
transparent and neutral platform for promoting competition in supply of
electricity at wholesale level. CERC has issued sidelines for setting up of a
power exchange system in the country on February 7, 2007
OPPORTUNITIES
As per National
Transmission Plan, the inter-regional transmission capacity is to be increased to
37,700 MW by the year 2011 -12 as against the present lnter-regional
transmission capacity of 14,100 MW. This would provide considerable
opportunities for enhancement of trading volumes. Also setting up of the Power
Exchange at National Level would provide a transparent and neutral platform for
trading of power at
Performance During
The Year
Operations
The company has
been issued license under category "F" which allows trading of 1000
million units and above every year without any upper limit.
Million Units
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Fiscal 2007 |
Fiscal 2006 |
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Purchase &
sale of power |
2303.06 |
1643.30 |
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361.28 |
Nil |
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Total |
2664.34 |
1643.30 |
During the year
2006-07, the company traded 2.664 billion units of power representing about 18%
of nation's total power trading volume, registering an increase of 7% in national
market share. This was primarily due to increase in overall volume of trading
by about 62% over last year.
In the past three
years, the company has developed a good customers base and has served over 25
state power utilities as its customers in all the five regions in the country.
Besides trading of short-term surpluses of the various state power utilities,
the company has worked out new strategies for trading of power and enhancing
utilization of existing capacity. One of them is utilization of un-requisitioned
Surplus Capacity from NTPC stations and another is utilization of Power through
Power Swap Arrangements (PSA). In case of former, the company utilizes
day-to-day un-requisitioned surplus of NTPC's power stations in one region in
order to meet the deficit of beneficiaries in other regions.
The company has
worked another innovative arrangement called Power Swap Arrangement under which
it has traded 361 million units. This arrangement was started in April 2006
with WBSEB wherein supply of 100 MW peak power to WBSEB from PSEB was made in
return WBSEB provided 100 MW of peak power to PSEB. Arrangement for similar
transactions were also made with other State Electricity Boards. Under the
power-swap arrangements only margin is billed to the buyer as the buyer has to
return the power purchased to the original supplier at a later date.
FINANCIAL
PERFORMANCE
The main revenue
is recognized by trading of power of 2.664 billion units contributes to 98% of
total revenue.
Rs in Million
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|
2006-07 |
2005-06 |
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8594 |
4344 |
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19 |
1 |
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Rebate &
surcharge on power purchase |
171 |
84 |
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other Income |
24 |
13 |
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Total |
8808 |
4442 |
Income from power trading
operations grew from Rs. 4344 million in the previous year to Rs. 8594 million
during the current year registerin3 an increase of 98% as per the above table.
In addition to power trading, the Company is also responsible for trading of
fly ash and ash based products. The Company traded 14798 MTs of fly ash and 95
MTs of Cenosphere.
The expenditure
incurred on the purchase of power and open access charges for the current year
was Rs. 8494 million as compared to Rs. 4271 million incurred during last year
and has almost doubled over the year.
Rs in Million
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|
2006-07 |
2005-06 |
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Power purchase
& Open access charges |
8494 |
42711 |
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Consumption of
Ash/products |
10 |
-- |
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Rebate on power
sale & provision for rebate on power sale |
157 |
83 |
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Other expenses |
50 |
35 |
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Total operating expenses |
8711 |
4389 |
The increase in
power purchase expenses corresponds to the increase in the sale of power.
During the current year, the consumption of Ash and ash products has been of
the order of Rs. 10 million. The rebate on power of sale including provision
for rebate is Rs. 157 million as compared to Rs. 83 million in the previous
year.
The depreciation
cost as compared to total expense is negli3ible since the fixed assets in the
company are represented by furniture and fixtures, EDP machines etc. and the
Gross Block was of the order of Rs. 3.127 million as on 31.3.2007.
Rs. In Million
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2006-07 |
2005-06 |
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Depreciation |
0.753 |
0.454 |
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Interest & Finance Charges |
0.408 |
1.066 |
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Total Expenses including operating expenses |
8712 |
4391 |
Due to change in
accounting policy on in respect of depreciation, the Personal Computers,
laptops, Photocopiers, fax machines etc. there is an increase in depreciation to
an extent of Rs. 2,61,275 (please refer to note no 8.1. of schedule 17 to the
Balance Sheet) There is a substantial reduction in interest and finance charge
on account of reduction in bankcharges due to increase in banking transactions
taking place on Real Time Gross Settlement mode rather than on Telegraphic
Transfers made in the previous year.
The net profit
after tax soared from Rs.33.27 million to Rs.65.12 million registering an
increase of 96%.
Fixed Assets
- Furniture and
Fixture and other office Equipments
- EDP and WP
Machines
- Intangible
asses – Software
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
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Indian Rupees |
|
US Dollar |
1 |
Rs. |
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|
1 |
Rs. |
|
Euro |
1 |
Rs. |
SCORE & RATING EXPLANATIONS
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SCORE FACTORS |
RANGE |
POINTS |
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HISTORY |
1~10 |
5 |
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PAID-UP CAPITAL |
1~10 |
5 |
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OPERATING SCALE |
1~10 |
5 |
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FINANCIAL CONDITION |
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--BUSINESS SCALE |
1~10 |
6 |
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--PROFITABILIRY |
1~10 |
4 |
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--LIQUIDITY |
1~10 |
5 |
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--LEVERAGE |
1~10 |
5 |
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--RESERVES |
1~10 |
5 |
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--CREDIT LINES |
1~10 |
5 |
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--MARGINS |
-5~5 |
- |
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DEMERIT POINTS |
|
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--BANK CHARGES |
YES/NO |
YES |
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--LITIGATION |
YES/NO |
NO |
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--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
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MERIT POINTS |
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--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
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--EXPORT ACTIVITIES |
YES/NO |
NO |
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--AFFILIATION |
YES/NO |
YES |
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--LISTED |
YES/NO |
NO |
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--OTHER MERIT FACTORS |
YES/NO |
YES |
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TOTAL |
|
45 |
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 |
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