MIRA
INFORM REPORT
|
Report Date : |
09.04.2008 |
IDENTIFICATION
DETAILS
|
Name : |
NATIONAL ORGANIC CHEMICAL INDUSTRIES LIMITED |
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Registered Office : |
Mafatlal House, H T Parekh Marg, Backbay Reclamation, Churchgate,
Mumbai, 400020, Maharashtra |
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Country : |
India |
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Financials (as on) : |
31.03.2006 |
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Date of Incorporation : |
11.05.1961 |
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Com. Reg. No.: |
11 - 12003 |
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CIN No.: [Company
Identification No.] |
L99999MH1961PLC012003 |
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TAN No: |
MUMN00133A |
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Legal Form : |
Public limited
liability company. The company’s shares are listed on the Stock Exchanges |
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Line of Business : |
Manufacturing of
petrochemicals, high density polyethylene, special grade polypropylene &
polymer alloys & blends, PE wax, ethylene vinyl acetate co-polymer,
processed polyethylene / Eva products, Ziegler catalyst, n-butene – 1, rubber
chemicals & their intermediates, oxygen, steam, demineralised water,
nitrogen and cooling water. |
RATING &
COMMENTS
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MIRA’s Rating : |
Aa |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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 |
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Maximum Credit Limit : |
USD 13244152 |
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Status : |
Very Good |
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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 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. It can be
regarded as a Promising business Partner in a medium to long-run. |
LOCATIONS
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Registered Office : |
Mafatlal House, H T Parekh Marg, Backbay Reclamation, Churchgate,
Mumbai, 400020, Maharashtra |
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Tel. No.: |
91-22-66364062 |
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Fax No.: |
91-22-66364060 |
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E-Mail : |
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Website : |
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Factory : |
v Petrochemical Plant
C-37, Trans Thane Creek Industrial Area, Off. Thane Belapur Road,
Navi Mumbai 400 701, Maharashtra, India
Tel : 91-22-27672735
Fax : 91-22-27671865 v Rubber Chemicals Plant C-37, Trans-Thane Creek Industrial Area, Off Thane Belapur Road, Navi Mumbai 400 705, Maharashtra, India. v Plastic Products Plant C-1,
MIDC Industrial Area, Post Shivani, District Akola - 444 104, Maharashtra,
India. |
DIRECTORS
|
Name : |
Mr. Arvind N. Mafatlal |
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Designation : |
Chairman - Emeritus |
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Name : |
Mr. Hrishikesh A. Mafatlal |
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Designation : |
Chairman |
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Name : |
Mr. Rohit Arora |
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Designation : |
Director |
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Name : |
Mr. T.D. Chaudhuri |
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Designation : |
Director - (IIBI
Nominee) |
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Date of Appointment : |
02.02.2006 |
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Name : |
Mr. Berjis Desai |
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Designation : |
Director |
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Name : |
Mr. V. R. Gupte |
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Designation : |
Director |
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Qualification
: |
B.Com., F.C.A. |
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Date of
Appointment : |
1st
April, 1993 |
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Previous
Employment |
Polyolefins
Industries Limited – Executive Director – Finance |
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Name : |
Maj. Gen. (Retd) S.C.N.
Jatar |
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Designation : |
Director (ICICI
Bank Nominee) |
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Date of
Appointment : |
05.10.2005 |
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Name : |
Mr. S. K. Mahapatra |
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Designation : |
Director - (GIC Nominee) |
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Name : |
Mr. Vishad P. Mafatlal |
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Designation : |
Director |
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Name : |
Mr. N. Sankar |
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Designation : |
Director |
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Name : |
Mr. C.R. Gupte |
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Designation : |
Managing Director |
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Date of
Appointment : |
01.08.2005 |
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Name : |
Mr. U.M. Karnik |
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Designation : |
Director |
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Name : |
Mr. C. L. Jain |
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Designation : |
Director - (GIC Nominee) |
KEY EXECUTIVES
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Name : |
Mr. S. R. Deo |
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Designation : |
Vice President -
Technical |
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Name : |
Mr. R. M. Gadgil |
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Designation : |
Vice President -
Marketing |
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Name : |
Mr. S. R. Iyer |
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Designation : |
Vice President
-Manufacturing |
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Name : |
Mr. U. M. Karnik |
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Designation : |
Vice President –
Legal & Company Secretary |
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Name : |
Mr. S. D. Ghate |
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Designation : |
General Manager –
Personnel & Administration |
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Name : |
Mr. C. S. Inamdar |
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Designation : |
General Manager-
Marketing & Technical Services |
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Name : |
Mr. A. Sivaraman |
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Designation : |
General Manager-
Purchase |
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Name : |
Mr. P. Srinivasan |
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Designation : |
General Manager -
Finance |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
As on 31.03.2007
|
Names of Shareholders |
No. of Shares |
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Indian Promoters |
50,037,779 |
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Mutal Fund and UTI |
44,680 |
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Banks, Financial Institutions, Insurance
companies, (Central/State Govt. Institutions/Non-Government Institutions) |
18,752,959 |
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Fits |
2563,411 |
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Private Corporate Bodies |
17,166,323 |
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Indian Public |
71,141,921 |
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NRI/OCBs |
1,079,907 |
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Total
|
160,786,980 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturing of
petrochemicals, high density polyethylene, special grade polypropylene &
polymer alloys & blends, PE wax, ethylene vinyl acetate co-polymer,
processed polyethylene / Eva products, Ziegler catalyst, n-butene – 1, rubber
chemicals & their intermediates, oxygen, steam, demineralised water, nitrogen
and cooling water. |
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Products : |
·
Ethylene ·
Propylene ·
Butadiene ·
Benzene and
their derivatives ·
Polymers ·
Rubber ·
Chemicals
and Plastic products. |
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Exports : |
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Countries : |
v
Australia v
EEC
Countries v
Far East
Asia v
Gulf
Countries v
U.S.A. |
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Imports : |
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Countries : |
v
Japan v
South Africa v
U.K. v
U.S.A |
PRODUCTION STATUS
|
Particulars |
Unit |
Licensed
Capacity |
Installed
Capacity |
Actual
Production |
|
Rubber Chemicals and their Intermediaries |
MT |
N.A. |
N.A. |
N.A. |
|
Proceed Polyethylene/EVA Products |
MT |
34,870 |
NIL @@ |
33.450 |
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Rubber Chemicals and their Intermediaries |
MT |
29,839 * |
1,452 # |
30,922 * |
Notes:
@ Installed capacity is as certified by the
management.
@@ Installed capacity of 8,100 MT of Plastics
Products division, used by the Company for manufacture on behalf of “Relpol”,
which division was completely demerged on 20 July 2005 to Relpol. Consequently,
there is no installed capacity for Processed polyethylene/EVA products at the
end of previous year.(Refer note no.7 of this Schedule).
* Includes 3,284 MT (previous period 2,736 MT)
converted for the Company by third parties.
# Includes nil (previous year 588 MT) produced
by the Company for third party.
N.A.
– not applicable
GENERAL
INFORMATION
|
Suppliers : |
v Dipti Corrugating Industries Limited v Daman Metalic Oxides v Goma Engineering Private Limited v IGP Engineers Limited v KTES v Kusum Enterprises v Laxmi Polyplast Industries v MAS Engineers v Paramount Forge v R. S. V. Agencies v Shree Shakti Containers v SVAR Associates v Sohan Engineering Enterprises v Sigma Chemical Industries v Sharpenn Technologies Private Limited v Sharp Batteries and Allied Industries Limited v Thermal Instruments (India) Private Limited v Vijoy Power Transmissions Private Limited v Western Rubbers India Limited v Amit Plastics v Ambika Fabricators v Autogenous Welding & Repair Company Limited v Altop Controls v Bengal Industries v Cintex Industrial Corporation v Dembla Valves v Durosharp Knives v Gujarat Engineering Company v Gauges Bourdon (I) v Goma Engineers Private Limited v Hind Hydraulic Systems Private Limited v LPC v Engineers Limited v Jadhav Engineering Private Limited v Lion Asbestos Packing Industries v Monometer India Private Limited |
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Customers : |
v Good Year v Bridgestone v Yokohama v General Tyres |
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No. of Employees : |
3364 Employees |
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Bankers : |
v HDFC Bank
Limited v Axis Bank
Limited |
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Facilities : |
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Banking
Relations : |
Good |
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Auditors : |
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Name : |
C.C. Chokshi and Company, Chartered Accountants |
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Memberships : |
v
Confederation
of Indian Industries |
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Subsidiaries : |
v
Ensen
Holdings Limited v
Urvija
Investments Limited v
PIL:
Chemicals Private Limited |
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Associates : |
v
Navin
Fluorine International Limited v
Mafatlal
Industries Limited v
Mafatlal
Finance Company Limited v
Eyeglobal
Technologies Private Limited |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
1200000000 |
Equity Shares |
Rs.10/-each |
Rs.12000.000 millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
160786980 |
Equity
Shares |
Rs.10/-each |
Rs.1607.870 millions |
Notes:
Of the above:
(a) 97,302,850 shares alloted as fully
paid-up by way of bonus shares by capitalisation of General Reserve and Share
Premium Account
(b) 13,302,850 shares allotted to the
shareholders of the Polyolefins Industries Limited pursuant to the scheme of
amalgamation without payment in cash.
(c) 38,181,280 shares alloted, to erstwhile
Secured Lenders without payment in cash in terms of the scheme of arrangement
as approved by the Bombay High Court.
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 (18 Months) |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
1607.870 |
1607.870 |
1226.057 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
1703.168 |
1643.961 |
377.421 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
(267.065) |
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NETWORTH |
3311.038 |
3251.831 |
1336.413 |
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LOAN FUNDS |
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1] Secured Loans |
1.994 |
2.567 |
572.734 |
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2] Unsecured Loans |
0.000 |
4.775 |
4.775 |
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TOTAL BORROWING |
1.994 |
7.342 |
577.509 |
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DEFERRED TAX LIABILITIES |
91.213 |
0.000 |
0.000 |
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TOTAL |
3404.245 |
3259.173 |
1913.922 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
1586.121 |
1663.434 |
673.662 |
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Capital work-in-progress |
190.207 |
16.422 |
8.963 |
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INVESTMENT |
150.331 |
30.231 |
30.139 |
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DEFERREX TAX ASSETS |
0.000 |
15.787 |
86.871 |
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CURRENT ASSETS, LOANS & ADVANCES |
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Inventories |
717.109
|
603.737
|
582.910
|
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Sundry Debtors |
681.315
|
790.497
|
927.830
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Cash & Bank Balances |
187.175
|
290.398
|
120.095
|
|
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Other Current Assets |
0.040
|
0.040
|
0.040
|
|
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Loans & Advances |
990.227
|
796.432
|
637.445
|
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Total
Current Assets |
2575.866
|
2481.104
|
2268.320
|
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Less : CURRENT LIABILITIES & PROVISIONS |
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Current Liabilities |
644.899
|
538.673
|
952.748
|
|
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Provisions |
453.381
|
409.132
|
201.285
|
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Total
Current Liabilities |
1098.280
|
947.805
|
1154.033
|
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Net Current Assets |
1477.586
|
1533.299
|
1114.287
|
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MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
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TOTAL |
3404.245 |
3259.173 |
1913.922 |
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PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 (18 Months) |
|
|
Sales Turnover |
3043.052 |
3630.269 |
4920.371 |
|
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Other Income |
246.975 |
285.277 |
0.000 |
|
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Total Income |
3290.027 |
3915.546 |
4920.371 |
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Profit/(Loss) Before Tax |
352.544 |
670.725 |
1747.204 |
|
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Provision for Taxation |
109.010 |
61.394 |
(86.471) |
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Profit/(Loss) After Tax |
243.534 |
609.331 |
1833.675 |
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Earnings in Foreign Currency : |
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Professional Fees |
0.561 |
0.332 |
0.000 |
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Interest |
0.000 |
0.132 |
0.000 |
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Commission on Sales |
9.943 |
10.890 |
0.000 |
|
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Others |
5.920 |
3.218 |
1380.220 |
|
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F.O.B. Value of Goods |
1299.155 |
1428.997 |
0.000 |
|
Total Earnings |
1315.579 |
1443.569 |
1380.220 |
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Imports : |
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|
Raw Materials |
935.120 |
842.669 |
0.000 |
|
|
Stores & Spares |
1.580 |
1.950 |
0.000 |
|
|
Capital Goods |
8.338 |
4.895 |
0.000 |
|
|
Others |
0.000 |
0.000 |
938.684 |
|
Total Imports |
945.038 |
849.514 |
938.684 |
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Expenditures : |
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Manufacturing Expenses |
2917.946 |
3164.151 |
|
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Purchases made for re-sale |
28.240 |
28.153 |
|
|
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Interest |
3.141 |
6.888 |
3173.167 |
|
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Depreciation & Amortization |
65.405 |
63.766 |
|
|
|
Other Expenses |
0.000 |
0.968 |
|
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Stock in Process |
(77.249) |
(19.105) |
|
|
Total Expenditure |
2937.483 |
3244.821 |
3173.167 |
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QUARTERLY RESULTS
|
PARTICULARS |
30.06.2007 |
30.09.2007 |
31.12.2007 |
|
Type |
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
|
Sales Turnover |
738.200 |
859.700 |
940.000 |
|
Other Income |
64.400 |
89.500 |
94.500 |
|
Total Income |
802.600 |
949.200 |
1034.500 |
|
Total Expediture |
751.700 |
907.500 |
975.800 |
|
Operating Profit |
50.900 |
41.700 |
58.700 |
|
Interest |
10.000 |
2.100 |
3.700 |
|
Gross Profit |
49.900 |
39.600 |
55.000 |
|
Depreciation |
18.300 |
18.600 |
19.400 |
|
Tax |
11.300 |
6.900 |
16.100 |
|
Reported PAT |
2.300 |
14.100 |
19.500 |
KEY RATIOS
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt Equity Ratio |
0.00 |
0.16 |
4.72 |
|
Long Term Debt-Equity Ratio |
0.00 |
0.03 |
1.08 |
|
Current Ratio |
2.17 |
1.75 |
0.76 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
1.73 |
2.64 |
1.01 |
|
Inventory |
5.13 |
6.81 |
3.83 |
|
Debtors |
4.61 |
4.70 |
4.07 |
|
Interest Cover Ratio |
114.68 |
82.59 |
11.29 |
|
Operating Profit
Margin (%) |
12.42 |
15.69 |
11.76 |
|
Profit Before Interest and Tax Margin (%) |
10.49 |
14.11 |
9.82 |
|
Cash Profit Margin (%) |
9.11 |
14.51 |
12.78 |
|
Adjusted Net Profit Margin (%) |
7.18 |
12.93 |
10.84 |
|
Return on Capital Employed (%) |
15.35 |
25.76 |
11.85 |
|
Return On Net Worth (%) |
10.54 |
27.20 |
59.94 |
LOCAL AGENCY
FURTHER INFORMATION
History
National
Organic Chemical Industries (NOCIL), a part of Arvind Mafatlal Group is
promoted in collaboration with Royal Dutch of Netherlands and Shell of UK in
1961. The company manufactures a wide range of petrochemicals -- ethylene,
propylene, butadiene, benzene and their derivatives, polymers, rubber, chemicals
and plastic products.
Its clients include Good Year, Bridgestone, Yokohama, General Tyres, etc. It
has also tied-up with Dowelanco, US, to establish a joint venture called
De-NOCIL Crop Protection, a deemed public company, to manufacture and market crop
protection products in India. It has got two investment subsidiaries of namely
Ensen Holdings and Urvija Investments.
The company has signed a Memorandum of Understanding (MOU) with Shell Chemicals
and Montell Polyolefins for implementing the modernization project for which it
has received the environment clearance from the central government. It was also
agreed by them to acquire 49% stake in de-merged NOCIL. Recently Montell merged
along with Elenac & Targor to form a new entity known as Basell Polyolefins
which is 50:50 partnerships between the Royal Dutch Shell Group and BASF. As a
result of this restructuring of the operations of Shell, Montell and BASF
internationally, Basell has expressed its inability to participate in this
modernization project.
The company which in in the process of restructuring its business has signed an
agreement with Reliance Industries Limited in Jan 2004 to sell its
Petrochemicals and Plastic Products Division. Under this proposal the assets of
NOCIL's Petrochemical Division, certain liabilities of the company and the
business and undertaking of Plastic Products division as a going concern will
be demerged from the company and will vested in Nocil Petrochemicals
Limited(NPL), a wholly owned subsidiary of the company. Subsequent to this
demerger RIL will invest in the equity of the resultant company i.e. NPL.
|
Particulars |
Hrishikesh A. Mafatlal |
Vishad P. Mafatlal |
|
Qualifications |
Mr. Hrishikesh A.
Mafatlal holds a Honours Degree in
Commerce from the Sydenham College, Mumbai. In 1993, he
attended the Advanced Management Programme (AMP) at the Harvard Business School, United
States |
Mr. Vishad P. Mafatlal is a B. Sc. (Economics) University of
Pennsylvania, Wharton School, United States. |
|
Expertise in
Specific Functional Areas |
Mr. Hrishikesh A.
Mafatlal is the Vice Chairman of Mafatlal Industries Limited and Chairman
& Managing Director of Navin Fluorine International Limited Mr. Hrishikesh A. Mafatlal is
major interest in Petrochemicals, Chlorofluorocarbons Cextiles, Garments,
Financial Services, Specialty Chemicals, Fine Chemicals etc |
Mr. Vishad P.
Mafatlal, has business experience of more than eight years in Textiles and
Chemicals. |
|
Directorships held in other Companies |
Ř Cebon Apparels
Private Limited Ř Eyeindia.com
Private Limited Mafatlal Asset Management Ř Mafatlal
Burlington Industries Limited Ř Mafatlal
Industries Limited Ř Mafatlal Limited,
UK Ř Mafatlal
Securities Limited Ř . Mafatlal
Services Limited Ř Marigold
International Private Limited Ml PA Investments (Private) Limited Ř Molex Mafatlal
Micron Limited Ř PAMIL Investments
Private Limited Ř Navin Fluorine
International Limited Ř Romaga(UK)
Limited Ř RomagaAG, Zurich Ř 'SilviaApparel
Limited Ř Sunanda
Industries Limited Ř Sushripada
Investments Private Limited Ř Suvin
Technologies Limited Ř Suvin
Technologies Pte. Limited, Singapore Ř Vibhadeep
Investments & Trading Limited |
Ř Cebon Apparels
Private Limited Ř Eyeindia.com
Private Limited Ř Mafatlal Asset
Management Ř Mafatlal
Burlington Industries Limited Ř Mafatlal
Industries Limited Ř Mafatlal Limited,
UK Ř Mafatlal
Securities Limited Ř Mafatlal Services
Limited Ř Marigold
International Private Limited Limited Ř Ml PA Investments
(Private) Limited Ř Molex Mafatlal
Micron Limited Ř PAMIL Investments
Private Limited Ř Navin Fluorine
International Limited Ř Romaga(UK)
Limited Ř Romaga AG, Zurich Ř 'SilviaApparel
Limited Ř Sunanda
Industries Limited Ř Sushripada
Investments Private Limited Ř Suvin
Technologies Limited Ř Suvin
Technologies Pte. Limited, Singapore Ř Vibhadeep
Investments & Trading Limited Ř Mafatlal Services
Limited Ř Mafatlal Burlington
Industries Limited Ř Sunanda
Industries Limited Ř •Tropical
Clothing Company Private Limited Ř Cebon Apparels
Private Limited Ř Eyeindia.com
Private Limited Ř Suvin
Technologies Limited: Ř Suvin
Technologies Pte. Limited, Singapore, Ř Intouch
Communications Pte. Limited Ř Mafatlal Fabrics
Private Limited Ř Silvia Apparel
Limited Ř Sarvamangala
Holdings Private Limited Ř Eyeglobal
Technologies Private Limited Ř Marigold
International Private Limited Ř Myrtle Chemtex
Trading Private Limited Ř Mayflower Chemtex
Trading Private Limited Ř Navin Fluorine
International Limited |
|
Memberships/ Chairmanships of
Committees across Public Companies |
Mr. Hrishikesh A.
Mafatlal is on the Managing Committee of the Indian
Institute of Management, Ahmedabad (IIMA) The Mill Owners
Association, Mumbai (MOA) The Indian Cotton
Mills Federation (ICMF) and The Cotton
Textiles Export Promotion Council I (TEXPROCIL) |
NIL |
Mr. Berjis Desai:
Qualification:
Mr. Berjis Desai
has done his graduation from the Elphinstone College. He is a Law Graduate and
stood first in the Solicitor's Exams held by the Mumbai Incorporated Law
Society.
Expertise
in Specific Functional Areas
Mr. Desai is an
eminent Lawyer and is the Managing Partner of). Sagar Associates, Advocates
& Solicitors.
Directorships
held in other Companies
Sterlite Industries (India) Limited, Praj Industries Limited, Onward Technologies Limited, Adlabs Films Limited, Piramyd Retail Limited, Emcure Pharmaceuticals Limited, Bp Ergo Limited, Watson Wyatt India Private Limited, 3d PIm Software Solutions Limited, Isagro (Asia) Agrochemicals Private Limited, Cashtech Solutions India Private Limited, Vadhvan Port Private Limited, Business Asia Consulting Private Limited, Centrum Fiscal Private Limited, Seafreight Private Limited, Ferrari Express (1) Private Limited Agribuys.Com. (India) Private Limited, Capricorn Stud farm Private Limited, Capricorn Agrifarms & Developers Private Limited, Jakari Express Private Limited, Jakari Holdings Private Limited, Capricorn Plaza Private Limited, Capricorn Group Private Limited, Capricorn Castle Private Limited, Cap/icorn Residency Private Limited, Centrum Finance Limited
Memberships
/ Chairmanships of Committees across Public Companies
Member of the
American Arbitration, London Court of International Arbitration, ICC-lndia,
Indian Council of Arbitration.
Mr. C. R. Gupte:
Qualification:
Mr. C.R. Gupte is a B.
Sc. and a Fellow Member of the Institute of Chartered Accountants of India, New
Delhi.
Expertise
in Specific Functional Areas
Mr. Gupte is having
experience of about 30 years in dealing with the Financial, Marketing and
Commercial matters of the Rubber Chemicals Division of the Company including as
Head of this business for the last 10 years.
Mr. N. Sankar:
Qualification:
Mr. N. Sankar holds
a Masters Degree in Chemical Engineering from the Illinois Institute of
Technology, Chicago, United States.
Expertise
in Specific Functional Areas
Mr. N. Sankar has
interest in the fields of Chlorochemcials, Speciality Chemicals, Shipping,
Engineering, Insurance and Cement.
Directorships
held in other Companies
F. L. Smidth Limited, SHL Research Foundation, N. Shankar
Properties and Holdings Private Limited, Chennai Willingdon Corporate
Foundation, Chennai Heritage, Bata India Limited, Sanmar Engineering Corpration Limited, AMP Sanmar Life Insurance Company Limited, Sanmar Holdings Limited, SHL Securities
(Alpha) Limited, NS Family
Consolidations Private Limited, The India Cement Limited
Memberships/
Chairmanships of Committees across Public Companies
Institute of
financial Management & Research Academy for Management Excellence (ACME)
Performance of the
Company
The turnover of the Company for the year under review was Rs. 3390.000 millions as compared to Rs. 3980.000 millions for the previous year. The production of rubber chemicals and their intermediates was 29839 MT in 2006-07 compared with 30922 MT in 2005-06.
During the year, the sales volume remained at the same level as that of
the previous year. On the exports front, sales volume registered a decent
growth as compared to the previous year, however the growth on the exports
front was off set by lower volumes on the domestic front caused by the rampant
dumping resorted to by the competitors more particularly from China and South
Korea, leading to both loss of volumes and erosion in prices. The anti dumping
duties levied by the Government of India during the previous year on certain
products sourced from certain destinations had resulted in a much more level
playing field in the market during 2005-06 for those products manufactured, by
the Company. However, during the year under review the dumping has shifted to
newer sources which resulted in continual loss of revenues for the Company from
quarter to quarter.
Moreover, with crude oil prices hardening, the prices of various inputs of the Company also went up. This has resulted in lower after tax profit for the year.
The Company countered these difficulties with the development of new
products and also embarked on debottlenecking capacity in some cases. A
dedicated processor of an important product for the Company was not in a
position to expand his capacity; hence the Company acquired the processor's
unit at Vapi, Gujarat for Rs. 19.50 crores, the final formalities being
completed in February 2007. The unit is now vested in a 100 per cent subsidiary
of the Company called PIL Chemicals Private Limited. The Company also undertook
various energy conservation and efficiency enhancing measures, resulting in
savings in production costs.
Dividend
They are pleased to announce that considering the performance
of the Company, the Board has recommended payment of dividend of 5% on the
equity share capital of the Company.
Transfer of unpaid dividend
to the Investor Education and Protection Fund
As per the provisions of Section 205-C of the Companies Act, 1956, all unpaid dividends, including and up to the final dividend for 1998-99, and the fixed deposits lying unclaimed with the Company up to 31 March 2000, have been transferred to the Investor Education and Protection Fund.
Exports
During 2006-07, the Company exported rubber chemicals worth Rs.
1300.000 millions.
Even though the export volumes were higher, decline in sales realizations resulted in reduction of exports sales value by about 8 per cent. It may be noted that the Company recorded appreciable growth in select international segments. Most major international buyers not only continue to do regular business with the Company, they have in fact been enhancing the scope of their co-operation with the Company. The Company commenced the commercial production of some new products developed through its in-house Research, which were well received by global customers. The Company continued to maintain excellent long-term relationship with its domestic and international customers, strengthening its position as an industry leader.
Management Discussion
and Analysis
Industry structure
and developments
The Company is engaged in the manufacture and sale of rubber chemicals and has its manufacturing facilities in TTC Industrial Area (Thane) and dedicated ancillary manufacturing facilities in GIDC Industrial Area (Vapi) including one such facility through its wholly owned subsidiary PIL Chemicals Private Limited. The Company's regional stales offices are located in Mumbai, Delhi, Chennai and Kolkata.
The products manufactured by the Company are used by the tyre industry
and other segments of rubber industry. These chemicals not only accelerate the
vulcanization of rubber but also extend the life of rubber products. The Company
is constantly working towards achieving further improvement in technological
and operational efficiency of the existing products in their application. It
also strives to develop new products to increase its participation in the
market and to enlarge its product range.
Opportunities and threats
The global demand for tyres and rubber-based products is growing at a decent pace. A number of tyre players are concentrating their manufacturing locations in Asia (predominantly China, Thailand and India) on account of the growing car markets in these countries. As a result, the Company is attractively located to address increased demand, focusing on. Capacity expansion and new product development. Relevantly, the Company, has leveraged alternative technologies to improve operational efficiency.
In addition to the above, to take care of its future expansion plans, the
Company has acquired a 60 acre plot of land at Dahej near Bharuch in the
designated chemical zone of Gujarat Industrial Development Corporation.
This location is ideal from the Company's point of view in many respects and most importantly is in the vicinity of the major raw material suppliers. The presence of multiple input sources around Dahej will enable the Company to mitigate the risk arising out of single-source dependence.Cost optimization across a larger volume will also enhance competitiveness.
The Company also acquired the entire shareholding of PIL Chemicals Private
Limited, an erstwhile dedicated ancillary unit engaged in the manufacture of
key products used by major global tyre companies. The acquisition will enable
the Company to expand revenues and grow volumes significantly over the coming
years, leading to a growing share of the global rubber chemicals market.
The hardening of input prices as well as indiscriminate dumping by various
suppliers particularly from China and South Korea caused considerable rise in
rubber chemical imports into India and also thinned the margins in
2006-07.
Product-wise performance
During the year, the sales volume remained at similar levels to that of the previous year. On the exports front, the sales volumes registered positive growth as compared to the previous year. On the whole the growth on the exports front was off set by decline in the sales volume on the domestic front caused by rampant dumping undertaken by the competitors more particularly from China and South Korea leading to both loss of volumes and erosion in prices. The anti dumping duties levied last year by the Government of India on certain products sourced from certain destinations resulted in a more level playing field in the market during 2005-06 for some products. Unfortunately the dumping thereafter shifted to newer sources, resulting in loss of revenues for the Company every quarter after quarter during the current year.
Business
outlook
The Company is optimistic of capitalizing on the significant growth in the global demand for rubber chemicals through its wide marketing network, multiple manufacturing locations and strong brand. The Company has already embarked on capacity expansion and is also engaged in the manufacture of key products for the Company's customers. The new site at Dahej in Gujarat will enable the Company to enhance its current Global market share substantially. This is therefore being pursued vigorously by the Company.
Financial performance - operational
performance
During the year under review, the Company reported a profit before tax of Rs. 352.500 millions compared with Rs 670.700 millions in 2005-06. Even though the volume of production remained constant, realizations declined.
Due to the available cash surplus, the Company did not avail of any
fund-based working capital facilities out of the sanctioned limits by its
bankers. As the Company continued to remain debt-free with no encumbrances on
the fixed assets, the Management is confident of mobilizing necessary term
loans to commission its forthcoming Greenfield Dahej facility.
Material developments
in human resources
The Company had 153 management employees and 246 non-management employees across its locations towards the close of the financial year under review.
Industrial relations remained cordial in 2006-07. The long-term settlement with the Employees' Union has expired in December 2006; the Company received a charter of demands from the Union and negotiations thereon are proceeding in a cordial atmosphere.
Contingent Liability
Contingent Liability as defined in Accounting Standard 29 are disclosed by
way of notes to accounts. Provision is made if it becomes probable that an
outflow of future economic benefits will be required for an item previously
dealt with as a Contingent Liability.
Contingernt Liability in respect of: 2007 2006
a) Central excise duty and Customs duty
demands disputed 14.750
33.030
b) Income Tax demands disputed 94.244 120.599
c) Sales tax demands disputed 78.355
62.995
Fixed Assets
Ř Land Leasehold and
Freehold
Ř Building
Ř Plant and
Ř Machinery
Ř Furniture
Ř Fixture and
Ř Equipments
Ř
Vehicles
AS PER WEBSITE
Profile
Subject
manufactures and supplies rubber chemicals. Their product range includes
accelerators, anti-degradants, antioxidants, sulfur donor, post vulcanization
stabilizer and pre vulcanization inhibitors used in the rubber Industry. They
offer delayed action type sulfenamide accelerators for sulfur vulcanization of
elastomers. They are an ISO 9001:2000 certified company.
Business Summary
Incorporated in
1961, National Organic Chemical Industries (NOCIL) is a part of the Arvind
Mafatlal group in collaboration with Royal Dutch (Netherlands)/Shell (UK) .The
Company manufactures a wide range of petrochemicals -- ethylene, propylene,
butadiene, benzene and their derivatives, polymers, rubber, chemicals and plastic
products. Its clients include Good Year, Bridgestone, Yokohama, General Tyres,
etc. It has also tied-up with Dowelanco, US, to establish a joint venture
called De-NOCIL Crop Protection, a deemed public company, to manufacture and
market crop protection products in India. It has got two investment
subsidiaries of namely Ensen Holdings and Urvija Investments. The company has
signed a Memorandum of Understanding (MOU) with Shell Chemicals and Montell
Polyolefins for implementing the modernization project for which it has
received the environment clearance from the central government. It was also
agreed by them to acquire 49% stake in de-merged NOCIL. Recently Montell merged
along with Elenac & Targor to form a new entity known as Basell Polyolefins
which is 50:50 partnerships between the Royal Dutch Shell Group and BASF. As a
result of this restructuring of the operations of Shell, Montell and BASF
internationally, Basell has expressed its inability to participate in this
modernization project.
Further the company
has decided to restructure the business by splitting into three new companies
viz.
NOCIL
Petrochemicals, NOCIL Rubber and NOCIL Plastics. As per the plan NOCIL
shareholders will get in exchange of every 100 shares held, 70 shares in NOCIL
Petrochemicals, 16 shares in NOCIL Rubber Chemicals and 14 shares in NOCIL
Plastics. This ratio is roughly in the same ratio in which the businesses of
the new companies contribute to NOCIL's turnover. Due to unprecedented losses
by the Petrochemicals Division, the management of the company has decided to
restructure the operations. Under this, the assets from the division will be
separated and disposed off to clear the liabilities of the Petrochemicals
Division and the remaining if any will be taken over by the Rubber Chemicals
Division.
The Modernization
Project which was flagged off earlier was put on hold due to ever increasing
prices of inputs.
National Organic
Chemical Industries Ltd., popularly known as NOCIL, commenced
manufacture of Rubber Chemicals in the year 1976. Today, NOCIL is the
largest manufacturer of Rubber Chemicals in India with Annual Sales close to
Rs.3250 million (USD 75 million) and a Customer Profile that spans most of the
global market.
The Manufacturing
plant, located in an industrial zone designated for the Chemical Industry,
about 40 kms away from Mumbai, employs 'State of the Art' Technology for
the manufacture of PILFLex® - Antidegradants, PILnox® -
Antioxidants, PILCure® - Accelerators, Sulfur Donor, Post
Vulcanization Stabilizer and PILGarD®
- Pre Vulcanization Inhibitor extensively used in the Rubber Industry world
over.
NOCIL has committed
itself to World Class Product Quality, Customer Service and Environmental
Care Standards. In fact, this has been a 'Way of Life' for everyone
employed in NOCIL.
The challenges are
defined by the drive to understand the Customer's current and emerging needs
and meet these expectations on a continuous basis.
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 :
The 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.
The 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. 39.94 |
|
UK Pound |
1 |
Rs. 78.81 |
|
Euro |
1 |
Rs. 63.05 |
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 |
9 |
|
--LEVERAGE |
1~10 |
9 |
|
--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 |
YES |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
74 |
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, they have no basis upon which to
recommend credit dealings |
No Rating |
|