MIRA
INFORM REPORT
|
Report Date : |
28.04.2008 |
IDENTIFICATION
DETAILS
|
Name : |
ASHAPURA MINECHEM LIMITED |
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Registered Office : |
Jeevan Udyog
Building, 3rd Floor, 278 D.N. Road, G.P.O. Box No.912, Fort,
Mumbai - 400001, Maharashtra |
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Country : |
India |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
19.02.1982 |
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Com. Reg. No.: |
11-26396 |
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CIN No.: [Company
Identification No.] |
L14108MH1982PLC026396 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
MUMA05044E |
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PAN No.: [Permanent
Account No.] |
AAACA0957F |
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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 : |
Manufacturer of
Bentonite Processed Lumps and Bentonite Powder. |
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 14630000 |
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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 fine track. Available information indicates high financial
responsibility of the company.
Financial position of the company is satisfactory. Payments are usually correct as per
commitments. The company can
be considered good for any normal business dealings. It can be regarded as a
promising business partner in a long run. |
LOCATIONS
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Registered /
Administrative Office : |
Jeevan Udyog
Building, 3rd Floor, 278 D.N. Road, G.P.O. Box No.912, Fort,
Mumbai - 400001, Maharashtra, India. |
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Tel. No.: |
91-22-2070258 (10
Lines)/56651700 |
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Fax No.: |
91-22-2079395/2074452 |
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E-Mail : |
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Telex : |
91-11-83199 AMCC
IN / 011-82103 ASHA IN |
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Website : |
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Factory 1 : |
Near Bhuj Railway Station, Bhuj, District Kutch, Gujarat, India Ler Village Taluka Bhuj, District Kutch, Gujarat, India 236-239, G.I.D.C., Chitra Industrial Estate, Bhavnagar - 364 004, Gujarat, India. Hamla Mines Plot No. 206, Opp. Kutch Dairy, Madhapar, Bhuj (Kutch), Gujarat, India Baraya EOU Plot No. / Survey No. 2558256/3, Bhuj Mundra Highway, Village-Baraya, Kutch – 370 415, Gujarat, India Jamnagar EOU Unit I Survey No. 195 and 198-P2, Village Ran, Taluka Jam-Kalyanpur, Jamnagar, Gujarat, India Jamnagar EOU Unit II Survey No. 195 and 198-P2 and P2, Village Ran, Taluka Jam-Kalyanpur, Jamnagar, Gujarat, India |
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Branches : |
Ø 301/302, S.M. Plaza, 3rd Floor,
45, Armenian Street, Parrys - Chennai-600001, Tamilnadu, India. Tel: 91-44-5226962/5223529 Fax: 91-44-5224390 Telex: 041-5163 ASHA IN Ø House No. 466, R.S. Road, Railway Kodur,
Cuddapah District - 516101, Andhra Pradesh, India. Tel.: 91-8566-44321/44184 |
DIRECTORS
|
Name : |
Mr. Navnitlal R. Shah |
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Designation : |
Executive Chairman |
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Qualification
: |
Entrepreneur |
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Date of
Appointment : |
19.02.1982 |
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Name : |
Mr. Chetan Shah |
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Designation : |
Managing Director |
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Qualification
: |
B. Com |
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Date of
Appointment : |
19.02.1982 |
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Name : |
Mr. Piyush A. Vora |
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Designation : |
Non-Executive Director |
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Date of
Cession : |
Resigned as Executive Director w.e.f.
30.01.2007 |
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Name : |
Mrs. Dina C. Shah |
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Designation : |
Non-Executive Directors |
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Name : |
Mr. R. D. Doshi |
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Designation : |
Non-Executive Directors |
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Name : |
Mr. A. M. Kadakia |
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Designation : |
Non-Executive Directors |
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Name : |
Mr. B. H. Antia |
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Designation : |
Non-Executive Directors |
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Name : |
Mr. S. H. Bathiya |
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Designation : |
Non-Executive Directors |
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Name : |
Mr. Larry Washow |
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Designation : |
Non-Executive Directors |
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Name : |
Mr. Gary Castagna |
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Designation : |
Non-Executive Directors |
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Name : |
Mr. Gary Morrison |
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Designation : |
Alternate Director(Alternate To Mr. Gary
Castagna) |
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Name : |
Mr. Ryan Mckendrik |
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Designation : |
Alternate Director (Alternate To Mr. Larry
Washow) |
KEY EXECUTIVES
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Name : |
Mr. Sachin Polke |
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Designation : |
Company Secretary |
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Name : |
Mr. Krishna Kumar Kumbhat |
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Designation : |
Chief Financial Officer |
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Name : |
Mr. Tanuj Roy |
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Designation : |
Director and Chief Executive Officer – Ashapura Voiclay Limited |
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Name : |
Mr. Hemul Shah |
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Designation : |
Chief Executive Officer – Bauxite Division |
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Name : |
Mrs. Geetha Nerurkar |
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Designation : |
Chief Executive Officer – Bentonite Division |
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Name : |
Mr. Vinod Kumar Sood |
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Designation : |
Chief Operating Officer – Alumina Refinery Project |
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Name : |
Mr. Rajnikant Panjwani |
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Designation : |
Vice President – Resource Development
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Name : |
Mr. Ramesh Balgi |
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Designation : |
Vice President – Group HR and Administration |
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Name : |
Mr. M. Velayudh |
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Designation : |
Vice President – International Trading and Other Initiatives |
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Name : |
Mr. Vinod Shah |
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Designation : |
Vice President – Gropup Accounts and MIS |
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Name : |
Mr. Dipak Vora |
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Designation : |
Vice President – Taxation and Internal Control |
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Name : |
Dr. Sanjay Kumar Jatty |
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Designation : |
General Manger – Research and Development |
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Name : |
Mr. E. V. Ramachandran |
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Designation : |
General Manager – Finance and Banking |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
As on 31.03.2007
|
Category of Shareholders |
No.
of Shares |
%
of Holding |
|
Promoters
Holding |
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Individuals |
16337472 |
41.7611 |
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Bodies Corporate |
2520 |
0.0064 |
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Total(A) |
16339992 |
41.7675 |
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Non-Promoters
Holding |
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Institutions |
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Mutual Funds |
1022670 |
2.6141 |
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Foreign Mutual Fund |
2192947 |
5.6055 |
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Foreign Inst. Investors |
3754349 |
9.5967 |
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Nationalised Bank |
306000 |
0.7822 |
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Non-Nationalised Bank |
237500 |
0.6071 |
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Government Companies |
10223 |
0.0261 |
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Total (B)(i) |
7523689 |
19.2317 |
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Non-institutions |
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Bodies Corporate |
1019484 |
2.6060 |
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Foreign Company |
8332345 |
21.2988 |
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Non Resident Indian |
1443179 |
3.6890 |
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Market Maker |
5881 |
0.0150 |
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Clearing Members |
5105 |
0.0130 |
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Trust |
784150 |
2.0044 |
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Public |
3667460 |
9.3746 |
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Total (B)(ii) |
15257604 |
39.0008 |
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GRAND TOTAL
(A)+(B) |
39121285 |
100.0000 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer of
Bentonite Processed Lumps and Bentonite Powder |
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Products : |
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Imports : |
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Products : |
All Products |
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Countries : |
Romania,
Indonesia, Korea |
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Terms : |
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Selling : |
L/C or CAD terms |
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Purchasing : |
L/C or CAD Terms |
PRODUCTION STATUS
|
Particulars |
Unit |
Licensed
Capacity |
Installed
Capacity |
Actual
Production |
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Processed Industrial Minerals |
MTS |
-- |
625300 |
-- |
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Processed Industrial Minerals – Mines |
MTS |
-- |
-- |
3599074 |
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Processed Industrial Minerals – Factory |
MTS |
-- |
-- |
388445 |
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GENERAL
INFORMATION
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No. of Employees : |
About 310 |
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Bankers : |
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Facilities : |
Term loans include: a) Term Loans from banks and others are against hypothecation of
vehicles and machinery. (Due within one year Rs. 7.191 millions ; Previous
year Rs. 3.206 millions) Working Capital Finance includes: Exports Packing Credit Finance and Post-shipment finance from Bank of
India, AXIS Bank Limited, Union Bank of India and Export Import Bank of India
are against hypothecation of inventories, book debts and secured by
discounting of export bills and Personal Guarantees of some of the Directors
and further secured by equitable mortgage of Fixed Assets of the Company. Post shipment credit from Deutsch Bank is secured by book-debts and
discounting of export bills. |
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Banking
Relations : |
Good |
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Auditors : |
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Name : |
Sanghavi & Company Chartered
Accountants |
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Address : |
Rajkot, Gujarat, India |
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Memberships : |
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Subsidiaries : |
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Associates : |
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CAPITAL STRUCTURE
Authorised Capital :
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No. of Shares |
Type |
Value |
Amount |
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6,00,00,000 |
Equity Shares |
Rs. 2/- each |
Rs. 120.000 millions |
|
3,00,000 |
Preference Shares |
Rs. 100/- each |
Rs. 30.000 millions |
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Total |
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Rs. 150.000
millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
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|
39,121,285 |
Equity Shares |
Rs. 2/- each
|
Rs. 78.243
millions |
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
78.243 |
64.508 |
63.827 |
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2] Employee Stock
Option Outstanding |
21.469 |
11.316 |
1.603 |
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3] Reserves &
Surplus |
3557.406 |
1187.555 |
691.710 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
3657.118 |
1263.379 |
757.140 |
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LOAN FUNDS |
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1] Secured Loans |
1291.394 |
966.855 |
1788.188 |
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2] Unsecured Loans |
0.000 |
0.000 |
150.000 |
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TOTAL BORROWING |
1291.394 |
966.855 |
1938.188 |
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DEFERRED TAX LIABILITIES |
43.540 |
29.974 |
17.074 |
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TOTAL |
4992.052 |
2260.208 |
2712.402 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
388.006 |
322.260 |
219.142 |
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Capital work-in-progress |
88.883 |
14.171 |
35.270 |
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INVESTMENT |
1554.269 |
296.139 |
251.086 |
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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 |
753.546
|
570.992 |
615.194 |
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Sundry Debtors |
1761.912
|
1243.276 |
1092.471 |
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Cash & Bank Balances |
135.439
|
226.764 |
348.862 |
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Other Current Assets |
0.000
|
0.000 |
0.000 |
|
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Loans & Advances |
1161.998
|
788.128 |
536.067 |
|
Total
Current Assets |
3812.895
|
2829.160 |
2592.594 |
|
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Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
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Current Liabilities |
669.860
|
1123.570 |
395.889 |
|
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Provisions |
182.141
|
81.297 |
0.000 |
|
Total
Current Liabilities |
852.001
|
1204.867 |
395.889 |
|
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Net Current Assets |
2960.894
|
1624.293 |
2196.705 |
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MISCELLANEOUS EXPENSES |
0.000 |
3.345 |
10.199 |
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TOTAL |
4992.052 |
2260.208 |
2712.402 |
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PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
Sales Turnover |
8996.421 |
6823.377 |
5084.205 |
|
|
Other Income |
49.078 |
15.207 |
0.000 |
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Total Income |
9076.7297 |
6869.8146 |
5084.205 |
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Profit/(Loss) Before Tax |
1624.484 |
842.916 |
199.478 |
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Provision for Taxation |
532.866 |
290.934 |
61.075 |
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Profit/(Loss) After Tax |
1091.618 |
551.982 |
138.403 |
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Earnings in Foreign Currency : |
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Export Earnings |
6063.483 |
4281.438 |
3396.445 |
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Total Earnings |
6063.483 |
10344.921 |
3396.445 |
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Imports : |
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Raw Materials |
4.370 |
0.526 |
1197.653 |
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Total Imports |
4.370 |
0.526 |
1197.653 |
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Expenditures : |
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Change in Inventory |
(181.814) |
46.094 |
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Materials, Mining and Manufacturing expenses |
2224.421 |
1837.569 |
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Direct Selling and Distribution Expenses |
4943.026 |
3686.329 |
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Administrative & Other Expenses |
299.113 |
292.039 |
4884.727 |
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Interest |
101.780 |
109.492 |
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Depreciation & Amortization |
34.487 |
24.144 |
|
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Total Expenditure |
7421.015 |
5995.668 |
4884.727 |
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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 |
3463.300 |
3875.70 |
3558.900 |
|
Other
Income |
9.000 |
18.500 |
44.400 |
|
Total
Income |
3472.300 |
3894.200 |
3603.300 |
|
Total
Expenditure |
2969.500 |
3332.200 |
3138.000 |
|
Operating
Profit |
502.800 |
562.000 |
465.300 |
|
Interest |
27.000 |
27.300 |
29.000 |
|
Gross
Profit |
475.800 |
534.700 |
436.300 |
|
Depreciation |
9.900 |
10.900 |
12.500 |
|
Tax |
135.700 |
130.400 |
58.900 |
|
Reported
PAT |
325.700 |
388.800 |
369.400 |
KEY RATIOS
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt-Equity
Ratio |
0.46 |
1.45 |
2.41 |
|
Long
Term Debt-Equity Ratio |
0.02 |
0.19 |
0.33 |
|
Current
Ratio |
1.43 |
1.27 |
1.22 |
|
TURNOVER
RATIOS |
|
|
|
|
Fixed
Assets |
17.53 |
17.03 |
15.91 |
|
Inventory |
13.57 |
11.47 |
8.86 |
|
Debtors |
5.98 |
5.83 |
5.19 |
|
Interest
Cover Ratio |
16.93 |
8.68 |
3.24 |
|
Operating
Profit Margin(%) |
19.56 |
14.33 |
6.15 |
|
Profit
Before Interest And Tax Margin(%) |
19.18 |
13.98 |
5.77 |
|
Cash
Profit Margin(%) |
12.43 |
8.37 |
3.15 |
|
Adjusted
Net Profit Margin(%) |
12.04 |
8.01 |
2.77 |
|
Return
On Capital Employed(%) |
48.27 |
38.82 |
12.12 |
|
Return
On Net Worth(%) |
44.30 |
54.32 |
19.73 |
LOCAL AGENCY
FURTHER INFORMATION
Company
History
The Chairman of the
company, Mr. N R Shah migrated to India in 1958 due to political unrest in
Burma. Belonging to a family of entrepreneurs Mr. Shah was on the look out for
business opportunities. With limited capital at his disposal, Mr. Shah was
shuttling between Burma & India while scouting for business in India.
Ultimately, the Bentonite
business was established along with some partners in early 60’s.
In 1973, first major export
order from Iraq was secured. Upto early 80’s, the business grew on strength of
drilling grade Bentonite from Gulf. The war between Iraq & Iran in 1980’s,
though a major setback, was a blessing in disguise. Ashapura started looking
for alternate applications of Bentonite.
Ashapura started developing
Bentonite for Iron Ore Pelletization. This business received major support from
marketing alliance with Mitsubishi Corporation in 1991.
In order to support the
bulk mineral business, through backward integration, Ashapura Group established
its own Shipping arm, Ashapura Shipping Ltd. (ASL) in the year 1992. It
supports the logistic function of Ashapura Group through in-house chartering,
ship broking and consultancy services. Ashapura Group also operates its own
captive jetties in the States of Gujarat and Maharashtra
Ashapura went public in
1993 with a premium issue in depressed capital markets. The issue received an
overwhelming response.
Having established itself
in Bentonite business, Ashapura started looking for diversification into other
industrial minerals & value added Bentonite products.
Cat Litter business was
started in 1995 on a very small level. By 1999, Ashapura established itself as
a reliable supplier of bulk cat litter granules.
In 1997, a joint venture
was established with American Colloid Company, the world’s largest Bentonite
Company, to manufacture value added Bentonite products. The JV set up its first
Company- Ashapura Volclay Limited in 2001 to manufacture Acid Activated
Bleaching Clay. The state-of-the-art technology for this project was acquired from
Mizusawa Industrial Chemicals Limited, a Takeda group Company which has the
second largest Pharma business in Japan. The company licensed the right to use
their world famous brand name “Galleon”. The bleaching clay produced by this
company is the only product of its kind in India today and is used as a
benchmark for other similar products. Mitsubishi Corporation is the marketing
agent for this Company in the International Market.
Ashapura ventured into
Bauxite business with first shipment of metallurgical grade Bauxite in 1998.
From a modest beginning, Ashapura has established itself as a preferred
supplier of Bauxite with annual volume touching 2.5 Million tons. True to its
claim of being the Pioneers of Industrial Minerals in India, after its global success
in Bentonite, Ashapura has been successful in putting the Bauxite from Western
India on the global Metallurgical Map. Today Ashapura has emerged as a highly
respected and preferred independent supplier in International Bauxite Business.
In 1999, American Colloid
Company acquired 20% holding in flagship company, Ashapura Minechem Ltd.
The potential for value
addition to minerals is almost endless. A firm believer of this fact, Ashapura
in the year 2000 set up an ultra modern Mineral Research Centre. Located in the
lush green locales of Parsik Hills in New Mumbai, the R & D Centre can
boast to be at par with the best in the World. Manned by a team of scientists
in disciplines like Chemistry, Geology, Metallurgy and Mineralogy this centre
is a dynamic launch pad for Ashapura’s growth.
With every established
mineral business Ashapura has moved onto the next step of value addition of the
mineral. During the year 2001, Ashapura acquired 51% stake in M/s. Bombay
Minerals Ltd, subsequently making it a Wholly Owned Subsidiary. This strategic
investment enabled Ashapura to have better control over the sources of Bauxite
and to become the largest private mining company controlling approximately 3000
acres of Bauxite deposit in Gujarat.
The infrastructure of Bombay Minerals Ltd. was refurbished to produce
Calcined Bauxite a high-value value-added product of Bauxite. With an annual
production of 50,000mt per annum, today BML has carved a niche for itself in
the local market. BML is the leading and quality-reliable manufacturer and
exporter of calcined bauxite.
The Company was successful in maintaining its growth momentum in the
financial year 2006-07 and has shown excellent performance across all existing
and new areas of business.
The Profit before Depreciation & Tax grew from Rs. 867.05 million in the
previous financial year to Rs.1658.97 million during the financial year under
review and the bottom line exhibited an increase of 98.53 % from Rs. 545.29
million to Rs. 1082.58 million. Correspondingly, the consolidated Net Profits
after minority interest have reflected an increase of 66.16% from Rs.783.55
million to Rs.1301.98 million during the financial year under review.
The improved performance was due to increased demand for Company's & its
Group's products, successful market penetration, prudently timed investments,
successful repayment of loans and the Company's Logistics &Shipping
expertise.
Further, the Company's Subsidiaries and Associates have commenced manufacturing
value added and diversified products thereby contributing significantly to the
Group's profits.
REVIEW OF
OPERATIONS
The Company's turnover increased sharply by 31.85% and stood at Rs.8996.42
million as compared to Rs.6823.38 million in the previous year. This is mainly attributable
to the increase in exports. The turnover of the entire Ashapura Group increased
to Rs.12724.43 million from Rs.8543.70 million in the previous year.
They continue to be India's leading mineral processors and exporters. They are
the largest exporters of Bentonite and Bauxite from India. The Company has
peristed with its strategy of geographic and portfolio diversification and is
well poised to extend its businesses to other minerals particularly Barites,
Kaolin, Iron Ore, Feldspar, Mica in addition to the existing mineral portfolio.
their products enjoy parity with the best in International Markets in terms of
quality.
Company has further penetrated the global market by acquiring mining leases in
Nigeria through a joint venture entered into by its Wholly Owned Subsidiary -
Ashapura Minechem (UAE) FZE, primarily for mining and developing of Barites
& Kaolin and by entering in an agreement with AMCOL for setting up a
Mineral processing complex and providing warehousing and processing facilities in
Antwerp so as to have a better distribution in European Union (EU)
Markets.
The Company has also been successful in obtaining permission from the
Development Commissioner, Kandla Special Economic Zone, Gandhidham, Kutch, for
establishing two 100% Export Oriented Units (EOU)in Jamnagar for Processed
Bauxite. These units are expected to commence their operations by the end of
this calendar year. The grant of EOU status and operation of the said Units is
likely to have a materially positive impact on the profitability of the
Company.
Their R & D Centre is the main contributory to the improved performance of
the Company. It has developed and customised several commercially viable
applications for their mineral base.
Thus the large and versatile mineral portfolio, research and product
development, logistic and shipping expertise together with their reputation and
credibility in the International and Domestic Markets enables us to continue to
be an integrated Indian player in the Industrial Mineral Business.
SUBSIDIARIES
a) Calcined Bauxite - Bombay Minerals Limited.
Bombay Minerals Limited is a 100% subsidiary of The Company.
The said Company has achieved significant growth in turnover during the year.
The turnover increased by 72.65% from Rs.320.73 million to Rs. 553.75 million,
over the previous year. However, the profit after tax reduced to Rs.32.53
million as compared to previous years profit of Rs.43.42 million mainly due to
factors like increase in manufacturing, selling and administrative expenses and
interest charges.
b) Domestic Bentonite Sales - Ashapura International Limited.
Ashapura International Limited is a 100% subsidiary of The Company.
The Sales of the Company recorded a significant increase of Rs.252.75 million.
The exports increased from Rs.66.02 million in the previous financial year to
Rs.279.17 million during the year under review, while the domestic sales
increased marginally to Rs.263.39 million from Rs. 189.68 million. The profit
after tax has increased from Rs.4.4 million in 2005-2006 to Rs.8.99 million in
the financial year under review.
c) Pesticides & soil nutrient products - Ashapura Claytech Limited.
During the year, The Company acquired 18,50,000 Equity Shares of Ashapura
Claytech Limited. from Ashapura International Limited. The Company now owns
95.25% of share capital of Ashapura Claytech Limited.
The Turnover of the Company stood at Rs.66.45 million during the financial year
under review as compared to Rs.57.37 million in the previous year. The
effective control on selling and distribution expenses coupled with decrease in
financial costs resulted in considerable improvement in the profit after tax,
which stood at Rs. 14.56 million during the year as compared to Rs.3.93 million
in the previous financial year.
d) International Trading - Ashapura Minechem (UAE) FZE
Ashapura Minechem (UAE) FZE is a 100% subsidiary of The Company.
The Company has achieved a turnover of Rs.3082.61 million during the year,
while the net profit for the year stands at Rs.124.25 million.
e) Ashapura Holdings (UAE) FZE
During the year, The Company's Wholly Owned Subsidiary - Ashapura Minechem
(UAE) FZE established its Wholly Owned Subsidiary named Ashapura Holdings (UAE)
FZE under the Hamriyah Free Zone Authority in May, 2007. The Company will be
engaged in investing its resources and providing business consultancy services.
JOINT
VENTURE
Bleaching Clay Business - Ashapura Volclay Limited.
The Company owns 50% Equity of Ashapura Volclay Limited.
With an ever-increasing demand, the Company has increased the production of
Bleaching Earth and Geo-Synthetic Clay liner during the year. The turnover
increased from Rs.331.75 million in 2005- 2006 to Rs.439.81 million during the
year under review. The net profits for the current year sharply increased by
40.21% over the previous year.
ASSOCIATES
a) Crystal Nanoclay Private Limited
The Company owns 50% Equity of Crystal Nanoclay Private Limited.
The Company is engaged in manufacturing of nano materials and compounding it
with various Polymeric (Plastic) materials, TPO's and TPVC's as per the
application requirements.
b) Bleaching Clay Processing - Hudson MPA SDN BHD
The Company has 25% stake in Hudson MPA SDN BHD.
Hudson MPA SDN BHD is engaged in the business of manufacturing bleaching clay.
It continues to cater to the Malaysian Edible Oil Industry, primarily dealing
in the Palm Oil Industry. The Company supplies the raw material for Bleaching
Clay Processing Plant to this Company.
c) Ashapura AMCOL NIV
The Company owns 50% stake in Ashapura AMCOL NV.
Ashapura AMCOL NV, a Company incorporated under Belgium laws is engaged in
setting up a bulk importing, grinding and packaging facility in Antwerp for
processing Bentonite, Kaolin lumps, bleaching clay and shipping them to various
European destinations.
NEW PROJECTS
a) Alumina Refinery
The Company has received the final approval from the Gujarat Government-
Industries & Mines Department through Gujarat Mineral Development
Corporation Limited. for setting up the Alumina Refinery Project in Kutch.
Subsequently the Company has initiated steps for commencement of the Project.
b) Kaolin Project
Kerala has large Kaolin reserves and these reserves are superior in quality as
compared to the other reserves available in India. Kaolin has a high industrial
demand. The Company has commenced the establishment of setting up its 180,000
tonnes per annum processing plant at Kerala, which would produce Hydrous
Calcined, Hydrous Non-calcined, Dry Calcined and Spray dried Kaolin. The total
capital expenditure on this project is estimated to be Rs.800 million. The
trial productions are expected to start by the end of this calendar year.
SUBSIDIARY COMPANIES
On an application made by the Company under Section 212(8) of the Companies
Act, 1956, the Central Government now acting through Ministry of Corporate
Affairs, vide its letter dated 141h February, 2007, has exempted the Company
from attaching to its Balance Sheet, the copies of the Balance Sheet, Profit
& Loss Account, Directors' Report, Auditors Report and the other documents
of its Subsidiary Companies which are required to be attached under Section
212(l) of the Companies Act, 1.956. However, a gist of the financial
performance of the Subsidiary Companies is contained in the Report. The Annual
Accounts of the Subsidiary Companies are open for inspection by any member /
investor and the Company will make available these documents upon request to
any member / investor who may be interested in obtaining the same. Further, the
respective Annual Accounts will be kept open for inspection at the Company's
Head Off ice and also at the registered offices of the Subsidiary
companies.
CORPORATE GOVERNANCE
The Company continues to comply with the requirements of the Listing Agreement
with the Stock Exchanges where the Company's Shares are listed. In addition to
the basic governance issues, the Management lays strong emphasis on
transparency, accountability and integrity.
In terms of the provisions under Clause 49 of the Listing Agreement, the
Company has complied with the requirements of Corporate Governance and a Report
on Corporate Governance together with a Certificate from the Company's Auditors
confirming compliance is set out in the Statement annexed (Annexure V) hereto
and forms part of this Report.
MANAGEMENT
DISCUSSION AND ANALYSIS
The Management of Ashapura Minechem Limited presents it analysis covering the
performance of the Company during the year 2006-2007 and an outlook for the
future. The future outlook is based on the current business environment, which
is dynamic and variable.
The Company witnessed another year of exceptional growth due to improved
volumes and expansion of operating margins. The revenues grew during the year
by 32.27% from Rs.6838.59 Million in the year 2005-2006 to Rs.9045.50 Million
in the current year. The operating margins grew from 14.31% in 2005-06 to
19.57% in 2006-2007. On a consolidated basis, the revenues were up to
Rs.12793.06 Million from Rs.8566.13 Million in the previous year.
INDUSTRY STRUCTURE AND DEVELOPMENT
Global economic dynamics are going through a major change in last few years.
The productive capacities are shifting eastwards from developed America and
Europe to low cost China, India and Far East. This factor is compounded by
growing service businesses in these countries. The expansion in productive
activities in developing countries has created new demand induced by large
young populations in these economies.
Productive momentum is seeing an accelerated economic growth in the developing
economies like China, India, Brazil and Russia. Supply bottle necks have
emerged in a number of raw materials due to sudden increase in demand. This
includes products like Iron Ore, Copper, Copper-ore, Nickel, Bauxite and energy
raw materials like Crude oil, Gas and Coal. The balance of economic power has
shifted in favour of countries and companies who control or have access to raw
material.
Aluminium business is a classic example in point. Following are some graphs
showing Aluminium and Alumina output in China.
In the year 2006 China produced 27.57% and 18.5% of Global Aluminium and
Alumina output respectively. Unlike historical global growth rates of 2% to 3%,
Aluminium consumption has grown at 13.94% (CAGR) in the last four years.
The Company is a significant beneficiary of this phenomenon in the global
economic environment from the turn of the century. They have consolidated their
mineral base in two major minerals namely Bauxite and Bentonite. From being an
insignificant portion of cost of Alumina production, Bauxite is becoming a key
driver of Alumina prices. They have become one of the larger players in the
freely traded Bauxite market in the world. A lot of Alumina capacities world
over depend on us for their raw material supply. This has given us a fair
return on their investment of time and money in acquiring Bauxite reserves.
Similarly major end users of Bentonite such as foundry, iron ore palletisation
and oil drilling business are all going through a sharp upswing in business
cycles.
Creation of new mining capacities world over require huge investments in
infrastructure and regulatory compliance. Moreover, new capacities to match the
growing global requirements are going to take a few years time to come through.
They do not expect a down turn in the business cycle for raw material business
for the next few years.
FINANCIAL PERFORMANCE
The performance for year under review was primarily driven by following
factors:
1) Improved Bauxite Volumes
The Bauxite volume improved by nearly 37% from 2.78 Million tons to 3.85
Million tons.
2) Improved realisations
Average FOB realisations of Bauxite improved by nearly 25% during the year.
Since Bauxite constitutes a large portion of revenues, the above factor led to
a sharp improvement in operating margins. Major cost increase by way of ocean
freight was controlled by entering into long term contracts of affreightment or
passing it on to customers in some cases.
Sharp increase in revenues was achieved without any significant growth in
borrowing and thus interest cost.
Company also raised a sum of Rs.1,437 Million by placing 6,500,000 Equity
Shares of Rs.2/- each at the price of Rs.221/- per share with domestic as well
as foreign institutional investors. This amount will be used over next two
years for investment in new businesses.
The effective tax rate for the Company came down marginally from 34.5% to
32.8%.
FUTURE
OUTLOOK
The present boom in Aluminum and other business is likely to continue for a few
years. It is unlikely that competitive supply sources will emerge in the near
term. They expect a significant growth in volume to continue in the current
year.
On a longer term, investments in value added products and new minerals will
start giving results in next two to three years. Future outlook of the Company
therefore remains very good.
SOCIAL MEASURES
Ashapura Foundation is established with an aim to carry out social, cultural
and rural development activities in Kutch District, Gujarat since last 11
years. The Government of India and Gujarat have recognized Ashapura Foundation
as its Project Implementing Agency to carry out rural development projects of
the Government in the following field of activities which started in most
backward and inaccessible 84 villages spread over 4 talukas of Lakhpat, Abdasa,
Nakhatrana and Mandvi, which are still dependent on agriculture and animal
husbandry as its occupation
Hiralaxmi Foundation has been formed in 2004 in memory of Late (Smt.) Hiralaxmi
Navnitlal Shah with a view to spread medical awareness on various diseases.
Organized 13 Seminars, 13 Camps and published 3 books. it has started Hiralaxmi
Medical Center at Bhayander for 1000 registered Members and Mobile Medical Van
for population of 10,000 people of remotest 18 villages of Lakhpat Taluka,
Kutch.
Hiralaxmi Craft Park has been set up in 2005 to provide a platform for the
vanishing craftsmen in Kutch to display and sell their products. It has become
a major tourist hub of Kutch. Activities and efforts were acknowledged by the
visit of Honorable Chief Minister of Gujarat and other Government official of
other States. Future expansions are coming up with set up of Museum, Design and
Research Center.
Fixed Assets :
Ø
Land &
Land Development
Ø
Compensation
For Premises Right
Ø
Mine Lease
Ø
Mine Shed
Ø
Buildings
(Including Barge Berth)
Ø
Plant &
Machinery
Ø
Barges
Ø
Vehicles
Ø
Furniture
& Fixture
Ø
Office
Equipment
Ashapura Group comprise
with following companies: -
1.
Ashapura
Minechem Limited
2.
Ashapura
International Limited
3.
Ashapura
Shipping Limited
4.
Ashapura
Claytech Limited
5.
Ashapura
Mineral Company
6.
Ashapura
Chinaclay Company
7.
Ashapura
Investment Private Limited
8.
Ashapura
Exports
Important company
in the group is Ashapura Minechem Limited whose details are given herewith.
The company imports
Soda Ash, S.T.P.P., H.D.P.E. Bags.
The exports
Bentonite, Attapulgite, Baryte, Bauxite, China Clay, Salt, Feldspar, Quartz to
over 40 countries.
Mining Expenses
Expenses incurred on mining including removal of overburden of mines are
charged to the profit & loss account as mining cost on the basis of
quantity of minerals mined during the year since removal of overburden and
mining are carried out concurrently and relatively within short period of time.
Provision for
Retirement Benefits
Liabilities in respect of gratuity to the employees are provided based
on the Group Gratuity Scheme with Life Insurance Corporation of India.
Liabilities in respect of leave encashment benefits to the employees are
provided on the basis of leave balance and salaries of the respective employees
as on the balance sheet date. Contribution to the provident and other statutory
funds is charged to the profit & loss account in the year in which it is
incurred.
Contingent
Liabilities
a. Guarantees given by the bank and counter guaranteed by the Company:
Rs.19.062 (73.877) millions.
b. Guarantees to banks against credit facilities extended to subsidiary companies:
Rs.425.177 (388.359)
millions.
c. Guarantees given on behalf of a subsidiary: Rs.29.498 (41.712)
millions.
d. Guarantees given by the Company to various Government Authorities:
Rs.294.550 (253.456) millions.
e. Claims against the Company not acknowledged as debt: Rs.57.724
(58.260) millions.
f. In respect of contracts remaining to be executed Rs.549.100 (NIL)
millions.
g. In respect of other matters: 2.342 (2.370) millions.
As Per Web:
Press Releases
Ashapura
strengthens its global market position in bleaching clay
The Ashapura Group of Industries announced the official
inauguration of its state-of-the art bleaching clay plant in Dharur,
Andhra Pradesh, India on August 19 , 2007..
The new facility, has a capacity of 50,000 tonnes per annum and uses a
unique and eco-friendly clay activation process developed and patented by the
group. The products manufactured at this plant are particularly suited for
refining palm oils , sunflower oils and lighter oils which have a large and rapidly
growing market particularly in South East Asian countries.
This is the group’s second bleaching clay plant ( the first is in Kutch
, Gujarat ) bringing the total capacity to over 1,00,000 tonnes. Both plants
cater to different oil segments making the total offering very comprehensive
and competitive. Ashapura has in a short span of time captured a huge
market share due to its global quality standards and cost effectiveness.
The group plans to double its capacities and set up many more world class
facilities across the globe. in the next two years. It
has vast mine reserves and access to top quality raw material to support its
ambitious plans of emerging as a world’s top bleaching clay supplier.
Ashapura has been operating its clay processing for soil nutrients unit
in Dharur for over a decade and the new bleaching clay plant strengthens its
association with the community giving the company an opportunity to develop
infrastructure and generate new employment opportunities in the area.
The Ashapura Group of Industries (mine owners and mineral
processors) has the technology and expertise to develop customized mineral
solutions for industries as conventional as foundry and iron ore and as
sensitive as cosmetics, pharmaceuticals, edible oils and
petrochemicals…
CMT REPORT
(Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts, India Prisons Service,
Interpol, etc.
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or investigation
registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE
GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE
RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.40.14 |
|
UK Pound |
1 |
Rs.79.66 |
|
Euro |
1 |
Rs.62.92 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
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 |
9 |
|
--CREDIT LINES |
1~10 |
9 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
72 |
This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING
EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest capability
for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit
consideration. Capability to overcome financial difficulties seems
comparatively below average. |
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 |
|