MIRA
INFORM REPORT
|
Report Date : |
20.08.2008 |
IDENTIFICATION
DETAILS
|
Name : |
PREMIER LIMITED |
|
|
|
|
Registered Office : |
Mumbai Pune Road, Chinchwad, Pune-411019, Maharashtra |
|
|
|
|
Country : |
India |
|
|
|
|
Financials (as on) : |
31.03.2008 |
|
|
|
|
Date of Incorporation : |
27.06.1944 |
|
|
|
|
Com. Reg. No.: |
020842 |
|
|
|
|
CIN No.: [Company
Identification No.] |
L34103PN1944PLC020842 |
|
|
|
|
TAN No.: [Tax
Deduction & Collection Account No.] |
PNET04203D |
|
|
|
|
PAN No.: [Permanent
Account No.] |
AAACT5523G |
|
|
|
|
Legal Form : |
A Public Limited Liability Company. The Company’s shares are listed on
Stock Exchange. |
|
|
|
|
Line of Business : |
Manufacturer of Automobiles, Vehicles, Machine Tools and Engineering |
RATING &
COMMENTS
|
MIRA’s Rating : |
A |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
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 |
|
Maximum Credit Limit : |
USD 8400000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a well-established and reputed company having fine track.
Available information indicates high financial responsibility of the company.
Trade relations are fair. Business is active. The company can be considered good for normal business dealings. It can be regarded as a promising business partners in a medium to
long-run |
LOCATIONS
|
Registered Office/ Factory : |
Mumbai Pune Road, Chinchwad, Pune-411019, Maharashtra, India |
||||||||||||||||||||||||||||||||||||||
|
Tel. No.: |
91-20-66310000/ 27475161 |
||||||||||||||||||||||||||||||||||||||
|
Fax No.: |
91-20-66310371/ 27476184 |
||||||||||||||||||||||||||||||||||||||
|
E-Mail : |
|||||||||||||||||||||||||||||||||||||||
|
Website : |
|||||||||||||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||||
|
Corporate Office : |
58, Nariman Bhavan, Nariman Point, Mumbai-400021, India |
||||||||||||||||||||||||||||||||||||||
|
Tel. No.: |
91-22-30281250 |
||||||||||||||||||||||||||||||||||||||
|
Fax No.: |
91-22-30281253 |
||||||||||||||||||||||||||||||||||||||
|
E-Mail : |
|||||||||||||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||||
|
Regional offices : |
|
||||||||||||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||||
|
Branch Office: |
C-13, Pannalal Silk Mills Compound, Lal
Bahadur Shastri Marg, Bhandup (West), Mumbai-400078, Maharashtra, India |
||||||||||||||||||||||||||||||||||||||
|
Tel. No.: |
91-22-25946970-78 |
||||||||||||||||||||||||||||||||||||||
|
Fax No.: |
91-22-25946969 |
||||||||||||||||||||||||||||||||||||||
|
E-Mail : |
DIRECTORS
|
Name : |
Mr. Maiteya Doshi |
|
Designation : |
Chairman and Managing Director |
|
Date of Birth: |
45 Years |
|
Qualification: |
MBA from IMD (Switzerland) and B.A (Economics) from Stanford
University, USA |
|
Experience: |
24 Years |
|
Date of Appointment: |
16.12.1985 |
|
|
|
|
Name : |
Mr. Jyotindra M Vakil |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Pravinchandra V Gandhi |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Arvind R Doshi |
|
Designation : |
President and Managing Director |
|
|
|
|
Name : |
Mr. Chandra Mohan |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. B K Khare |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. R S Peddar |
|
Designation : |
Nominee ( ICICI) Director |
|
|
|
|
Name : |
Mr. Chakor L Doshi |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. N N Jambusaria |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Arun Gandhi |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Sharayu Daftary |
|
Designation : |
Director |
KEY EXECUTIVES
|
Name : |
Mr. L Krishnamoorthy |
|
Designation : |
Company Secretary |
|
|
|
|
Name : |
Mr. Vinod L Doshi |
|
Designation : |
Executive Chairman |
|
|
|
|
Name : |
Mr. S Padmanabhan |
|
Designation : |
IAS (Retired) / Advisor |
|
|
|
|
Name : |
Mr. Asit Javeri |
|
Designation : |
Industrialist |
|
|
|
|
Name : |
Mr. Rohita Doshi |
|
Designation : |
Computer Engineer |
|
|
|
|
Name : |
Mr. Rohan Shah |
|
Designation : |
Solicitor |
|
|
|
|
Name : |
Mr. Udo Weigel |
|
Designation : |
Machine Tool Technologist |
|
|
|
|
Name : |
Ms. Kavita Khanna |
|
Designation : |
Management Consultant |
|
|
|
|
Name : |
Mr. V T Pawar |
|
Designation : |
Vice Presidents |
|
|
|
|
Name : |
Mr. P. P. Sastry |
|
Designation : |
Small Machine Project |
|
|
|
|
Name : |
Mr. Rakesh Mehta |
|
Designation : |
Light Vehicles |
|
|
|
|
Name : |
Mr. Ramesh Tavhare |
|
Designation : |
Corporate Affairs and Company Secretary |
|
|
|
|
Name : |
Mr. R G Kundalkar |
|
Designation : |
Machine Tools (Operations) |
|
|
|
|
Name : |
Mr. V J Shah |
|
Designation : |
Machine Tools (Design and Quality) |
|
|
|
|
Name : |
Mr. D D Mulherkar |
|
Designation : |
Machine Tools (Commercial) |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
As on 31.03.2008
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
|
Promoters |
7692634 |
29.51 |
|
Mutual Funds and UTI |
131214 |
0.05 |
|
Banks, Financial Institutions and Insurance Companies |
2309.639 |
8.86 |
|
FII’s |
5000 |
0.02 |
|
Bodies Corporate |
3895111 |
14.94 |
|
Indian Public |
12046663 |
46.22 |
|
NRIs / Foreign Nationals |
105672 |
0.40 |
|
Total |
26067843 |
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer of Automobiles, Vehicles, Machine Tools and Engineering |
||||||
|
|
|
||||||
|
Products : |
|
||||||
|
|
|
||||||
|
Exports : |
|
||||||
|
Products : |
|
||||||
|
Countries : |
|
||||||
|
|
|
||||||
|
Imports : |
|
||||||
|
Products : |
Conventional and CNC Machine Tools |
||||||
|
Countries : |
|
||||||
|
|
|
||||||
|
Terms : |
|
||||||
|
Selling : |
|
||||||
|
|
|
||||||
|
Purchasing : |
|
PRODUCTION STATUS
|
Particulars |
|
|
Installed
Capacity |
Actual
Production |
|
Vehicles |
|
|
15000 |
420 |
|
Engineering (including Machine Tools) |
|
|
431880 |
103 |
GENERAL
INFORMATION
|
Bankers : |
State Bank of India |
||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||
|
Facilities : |
|
|
|
|
|
Banking
Relations : |
Good |
|
|
|
|
Auditors : |
|
|
Name : |
Mr. Jagdish Khanna Chartered Accountant |
|
|
|
|
Associates/Subsidiaries : |
|
CAPITAL STRUCTURE
As on 31.03.2008
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
31000000 |
Equity Shares |
Rs. 10/- each |
Rs. 310.000 Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
28136127 |
Equity Shares |
Rs. 10/-
each |
Rs. 281.361
Millions |
Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
26067843 |
Equity Shares |
Rs. 10/-
each |
Rs. 260.679
Millions |
|
Add: 1986674 |
Equity Shares |
Rs. 10/-
each |
Rs. 19.867
Millions |
|
|
Add : Forfeited Shares amount paid up |
|
Rs. 0.269
Million |
|
|
Total |
|
Rs. 280.815 Millions |
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
280.815 |
260.948 |
260.900 |
|
|
2] Share Application Money |
9.240 |
17.088 |
0.000 |
|
|
3] Reserves & Surplus |
1393.170 |
1188.862 |
840.400 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
1683.225 |
1466.898 |
1101.300 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
627.613 |
480.561 |
400.000 |
|
|
2] Unsecured Loans |
138.500 |
106.500 |
29.500 |
|
|
TOTAL BORROWING |
766.113 |
587.061 |
429.500 |
|
|
DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
2449.338 |
2053.959 |
1530.800 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
675.701 |
385.793 |
261.500 |
|
|
Capital work-in-progress |
517.161 |
205.113 |
97.000 |
|
|
|
|
|
|
|
|
INVESTMENT |
36.224 |
6.593 |
417.200 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
1035.572
|
888.337 |
172.300 |
|
|
Sundry Debtors |
486.391
|
773.997 |
833.200 |
|
|
Cash & Bank Balances |
40.028
|
36.353 |
61.800 |
|
|
Other Current Assets |
2.829
|
3.833 |
0.000 |
|
|
Loans & Advances |
182.094
|
165.280 |
139.700 |
|
Total
Current Assets |
1746.914
|
1867.800 |
1207.000 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
351.678
|
231.513 |
327.700 |
|
|
Provisions |
194.569
|
181.658 |
126.100 |
|
Total
Current Liabilities |
546.247
|
413.171 |
453.800 |
|
|
Net Current Assets |
1200.667
|
1454.629 |
753.200 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
19.585 |
1.831 |
1.900 |
|
|
|
|
|
|
|
|
TOTAL |
2449.338 |
2053.959 |
1530.800 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
|
|
|
|
|
|
|
Sales Turnover |
1070.278 |
784.403 |
1476.500 |
|
|
Other Income |
12.265 |
45.129 |
119.000 |
|
|
Exceptional Items |
28.199 |
475.564 |
0.000 |
|
|
Total Income |
1110.742 |
1305.096 |
1595.500 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
191.656 |
550.673 |
237.800 |
|
|
Provision for Taxation |
[42.490] |
68..265 |
23.400 |
|
|
Profit/(Loss) After Tax |
234.146 |
482.408 |
214.400 |
|
|
|
|
|
|
|
|
Earnings in Foreign Currency : |
|
|
|
|
|
|
Export Earnings |
9.950 |
9.993 |
NA |
|
Total Earnings |
9.950 |
9.993 |
NA |
|
|
|
|
|
|
|
|
Imports : |
|
|
|
|
|
|
Raw Materials |
111.441 |
88.641 |
NA |
|
|
Stores & Spares |
0.000 |
0.000 |
NA |
|
|
Capital Goods |
55.702 |
68.759 |
NA |
|
|
Others |
0.000 |
0.000 |
NA |
|
Total Imports |
167.143 |
157.400 |
NA |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Manufacturing Expenses |
427.694 |
352.593 |
25.500 |
|
|
Raw Material Consumed |
521.069 |
455.931 |
239.900 |
|
|
Excise Duty |
0.000 |
0.000 |
59.900 |
|
|
Power and Fuel Cost |
0.000 |
0.000 |
14.000 |
|
|
Increase/(Decrease) in Finished Goods |
[67.575] |
[36.443] |
0.000 |
|
|
Employee Cost |
0.000 |
0.000 |
131.900 |
|
|
Selling and Administration Expenses |
0.000 |
0.000 |
114.400 |
|
|
Expenditure Capitalised |
[27.131] |
[285.141] |
741.500 |
|
|
Interest and Financial Charges |
37.364 |
[6.651] |
36.600 |
|
|
Depreciation & Amortization |
27.665 |
17.134 |
12.100 |
|
|
Other Expenditure |
1013.792 |
825.658 |
634.300 |
|
Total Expenditure |
919.086 |
754.423 |
1357.700 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
|
30.06.2008 |
|
Sales Turnover |
|
|
233.900 |
|
Other Income |
|
|
5.500 |
|
Total Income |
|
|
239.400 |
|
Total Expenditure |
|
|
185.300 |
|
Operating Profit |
|
|
54.100 |
|
Interest |
|
|
11.300 |
|
Gross Profit |
|
|
42.800 |
|
Depreciation |
|
|
7.700 |
|
Tax |
|
|
4.400 |
|
Reported PAT |
|
|
30.700 |
KEY RATIOS
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
Debt-Equity Ratio |
0.43 |
0.41 |
0.32 |
|
Long Term Debt-Equity Ratio |
0.32 |
0.34 |
0.26 |
|
Current Ratio |
2.70 |
2.93 |
1.92 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
1.48 |
1.62 |
3.67 |
|
Inventory |
1.24 |
1.68 |
2.80 |
|
Debtors |
1.89 |
1.11 |
3.32 |
|
Interest Cover Ratio |
3.95 |
1.94 |
6.59 |
|
Operating Profit Margin(%) |
20.66 |
17.67 |
17.16 |
|
Profit Before Interest And Tax Margin(%) |
18.34 |
15.75 |
16.34 |
|
Cash Profit Margin(%) |
19.85 |
8.45 |
13.29 |
|
Adjusted Net Profit Margin(%) |
17.53 |
6.53 |
12.48 |
|
Return On Capital Employed(%) |
9.82 |
8.04 |
19.40 |
|
Return On Net Worth(%) |
13.39 |
4.70 |
19.52 |
LOCAL AGENCY
FURTHER INFORMATION
HISTORY:
Incorporated in 1944, Premier Automobiles (PAL) manufactures passenger
cars, trucks, buses, etc. PAL's Premier Padmini enjoyed a commanding position,
along with Hindustan Motors, till 1984, before the launch of the Maruti 800. In
Jan.'86, PAL started producing the 118 NE. PAL plans to rejuvenate itself
through modernisation, new project launches and a joint venture with
Automobiles Peugeot, France.
It has also tied up with Fiat, Italy. As the present Padmini model is a product
of Fiat, the latter will help upgrade the model. But the thrust will be on
another model to be launched, named Uno, with technology from Fiat, Italy.
Fiat, which considers India a key market, is also interested in strengthening
its long-term relationship with PAL. The 999 cc Uno has roll out by the
beginning of 1996. The company has entered into an arrangement with Ind Auto
Limited (IAL) for assembly of Premier cars at Kurla.
Its machine tool division has obtained the ISO 9001 certification. Bureau
Veritas Quality International (BVQI) awarded MTD ISO 9001 for next three years
from 24th December, 1999. During 2002 the company signed a long term contract
with Telco for painting the bodies. The company's real estate business
witnessed a slight growth since,it has entered into a MOU with a leading
developer for development of its residential land at Dombivli at a
consideration of Rs.150.000 Millions.
During the year, the Company has made good progress with a rise of 34%
in gross sales to Rs.1193.200 Millions. The net profit from operations also has
gone up by 249 % to Rs.234.100 Millions.
Operations
The operations are covered in detail in the Management Discussion and
Analysis Report, forming part of this Annual Report.
Share Capital
During the year, 19,86,674 equity shares of Rs. 10/- each were allotted
at Rs.39.43 per share (including premium of Rs.29.43 per share) to the
Promoters of the Company on conversion of equivalent number of convertible
warrants issued on preferential basis earlier. Consequently, the equity capital
of the Company has increased to Rs.280.800 Millions with Rs.58.400 Millions
added to the share premium account. The proceeds have been utilized for
financing capital expenditure and working capital requirements.
Real Estate
The Company owns 216 acres of land located at Dombivli, Kalyan. The said
land was converted into stock-in-trade in the previous year at an amount of
Rs.607.200 Millions. The Company is examining various proposals to maximize
value out of the said land.
Financial Review
Sales Growth
In '07-'08 the Company's gross sales were Rs.1190.000 Millions compared
to Rs.890.000 Millions for the previous year achieving a 34% growth. The
Company has been achieving year on year growth of over 30% in the last 3 years.
This sales growth is expected to increase in the coming year due to increased
activities in the Engineering Services and Automotive businesses.
Profits and Margin Growth
The Company achieved an EBITDA (from operations) of Rs.228.500 Millions
compared to Rs. 85.600 Millions in the previous year registering a growth of
170%. The EBITDA margin to net sales was 21 % in '07-'08 (without exceptional
income).
The Company's year on year growth in profitability has been 36% for the past 3 years
and is expected to improve in the coming year. With the additional capex
incurred during the year and de-bottlenecking of capacities, both the sales
turnover and profitability should improve during the current year.
Costs
The wage cost increased by 26% to Rs 212.600 Millions compared to Rs 168.300
Millions in the previous year mainly due to the three year wage settlement with
labour, increase of executive compensation in line with the current market
situation and manpower increase due to higher operations.
There was also an increase in interest charges on account of larger bank limits
and other borrowings to fund the Company's growing operations. Other expenses
were in line with the increased operations.
Leverage and Liquidity
The Company currently has an un-revalued net worth of Rs.1680.000 Millions. The
long term debt is Rs.630.000 Millions and the total debt is Rs.770.000
Millions.
The debt-equity ratio is 0.46:1 and the long term debt to net worth is 0.38:1
which indicates a prudent debt level.
The Company's current ratio (current assets to current liabilities) is 3.24:1
and its quick ratio (current assets minus inventory to current liabilities) is
2.41:1 clearly indicating a healthy liquidity situation.
It is likely that inventories in relation to sales will show an increase during
the current year because of the changing product mix in Machine Tools towards
larger, longer cycle time machines. These machines although longer and more
difficult to make are also more profitable. Therefore, there is likely to be a
back ending of the sales and front ending of the inventory build up in
'08-09.
The Company is in the process of further enhancing its working capital limits
with the State Bank of India.
Capital Expenditure
During the year, the Company made capital investment of Rs.630.000 Millions
towards new building, plant and machinery, manufacturing infrastructure,
product development etc. This expansion and modernization program begun in
'05-'O6 has incurred a cumulative capital investment of Rs.1100.000 Millions.
During '08-'09 the Company expects to invest another Rs.900.000 Millions mainly
in Machine Tools and Engineering Services to further augment production
capacity.
In 'O5, the total shed space at the Company's Chinchwad facility was 1,38,634
sq.tt (12,884 sq. mtrs). This has nearly tripled to currently 4,04,087 sq.ft
(37,555 sq.mtrs), demonstrating the substantial growth in activities at the
Company's factory site.
Segment
Review
The Company operates in two segments: Engineering and Automotive. The
Engineering segment has two activities: Machine Tools and Engineering Services.
The Automotive segment has only one activity: Light Utility Vehicles.
Currently, the Engineering segment constitutes nearly 91 % of the Company's
turnover and is the predominant, ongoing and profitable operation.
The vehicle business is in a final 'project' stage and is expected to become
fully commercialized in financial year '08-'09.
The above mentioned three activities have been analysed and explained in detail
below:
Machine Tools
Industry Structure and
Outlook
Machine Tools, being capital goods, are directly linked to a country's GDP
growth. In years of strong GDP growth, the Machine Tools industry experiences
very strong demand and heavy order booking. This has led to a pattern of
regular cyclicality worldwide.
The largest Machine Tools markets are China, Japan, Germany, USA, Italy and
Korea accounting for nearly 60% of the global demand. India, with 0.7% share is
currently a small player. However, in the past three years, the demand for
Machine Tools in India has been growing at 30-40% annually, making it the
fastest growing market in the world.
Due to India's robust GDP growth during the past three years, the Indian
Machine Tools industry has also experienced strong growth and expansion in all
its segments. With increased capital investment planned by both private
industry and the public sector, the demand for Machine Tools over the next five
years is likely to remain strong, albeit with some short term sectoral dips in
demand.
The Machine Tools industry can broadly be broken up into two main sectors :
metal forming machines and metal cutting machines. In India, metal cutting
machines constitute 88% and metal forming machines constitute 12% of the total
Machine Tools production. The metal cutting sector, in India, accounted for a
total demand of Rs.55400.000 Millions per annum and domestic production of
Rs.17750.000 Millions per annum catering to 35 % of the domestic demand. The
balance was met by imports.
The Company operates in two areas of the metal cutting sector: gear
cutting machines and machining centres.
Gear cutting machine sales, in India, are about Rs.3450.000 Millions per year
and mainly used in the automobile, auto component and general engineering
industry. This had grown very fast during the earlier two years, but
experienced a slow down during '07-'08 linked to the two wheeler and commercial
vehicle sector slump that had a multiplier effect on the auto component
industry resulting in machine order deferrals. However, the market is showing
signs of revival and is expected to normalize in '08'09. The long term future
for gear cutting machines remains bright as they serve a fundamental requirement
i.e. gears in all engineering industries.
The machining center segment grew at 15 % per year and the size of the
domestic market was Rs.15600.000 Millions. There are several, strong, domestic
manufacturers catering to this requirement. This segment covers both vertical
and horizontal machining centres in varying sizes and prices from Rs.1.500
Millions to Rs.50.000 Millions. These machines find applications in all
engineering industries and are fundamental to any machine shop.
With the rapid growth in the Indian market, there has been a renewed
interest by international manufacturers to supply imported machines in India.
In fact, the number of imported machines over the last few years is showing a
steady rise.
There is also a large portion of the market, particularly small and
medium scale customers, who are procuring second hand, reconditioned, imported
machines at very low prices. This is an integral part of the industry structure
as second hand machine imports are permitted by the Government.
Machine Tools Performance
'07-'08 has been a significant year with a 42% increase in Machine Tools
sales over the previous year. The total number of machines, in all sizes and
segments produced during the year was 98 compared to 94 in the previous year.
The average price realization per machine was Rs.8.700 Millions compared to
Rs.6.400 Millions last year indicating a demand for larger size machines in
'07-'08 compared to the previous year. Product
quality and customer satisfaction were key focus areas. Many customers reposed
their faith in the company by placing repeat orders. A significant order was
received from AVTEC for 17 gear cutting machines, of various types, for Tate's
Nano project. In gear cutting machines, the demand for customized machines with
special features such as auto loader increased. The supply of two internally
developed high-speed gear hobbing machines was a strong start as they are
technologically comparable to those offered by global manufacturers at better prices
Large machine sales increased during the year with the supply of big
plano millers and vertical boring machines to the Railways. The Company also
supplied vertical turning machines to many leading private engineering
companies during the year.
Productivity was increased through process optimization and selective Vendor
Development thereby reducing machine delivery periods. The Company's service
infrastructure was strengthened nationwide and spares supply were vastly
improved to enhance customer satisfaction. This led to a significant reduction
in machine commissioning time.
The Company is in the process of establishing Tech Centers at Pune and Delhi to
showcase its machines to prospective customers in those regions. In addition,
the Company is undertaking measures to improve its brand visibility through
print media as well as participation in trade shows in India and abroad.
The Company is now promoting special product features such as electronic
gearboxes for gear hobbing machines and is introducing a defeatured gear
hobbing machine at an affordable price, to thwart second hand machine sales to
small-scale industries.
The Company has undertaken a selling agency for grinding machines
manufactured by Morara, Italy in India, to explore the hitherto untouched
grinding segment.
Product Development
With the liberalization of imports and reduction in customs duty,
international manufacturers now prefer to sell their Machine Tools directly in
India rather than licensing technology. Consequently, in the last 3 years the
Company has beefed up its design and development capability by investing in
'state-of-the-art' CAD/ CAM systems as well as hiring engineers for its new
product development initiatives. A number of new products have been successfully
developed in '07-'08
* High speed, internationally competitive gear hobbing machine of 150 -
250 mm diameter with direct drives suitable for dry cutting applications.
* Five axis CNC gear hobbing machine of 400mm diameter
* Small CNC vertical turning Machine of 400mm chuck diameter
* Overall design improvements in fit-finish, oil consumption,
manufacturing efficiency etc.
Manufacturing Capacity
During '07-'08 the Company invested Rs.310.000 Millions to expand and
modernize Machine Tools manufacturing and assembly capacities. A new, high bay,
shed of 1,00,000 sq. ft. area was erected and modern plant and equipment
aggregating to Rs.400.000 Millons installed (or being installed) during this
year. This should increase the output by nearly 400% and also overall
production capacity to nearly 1000 machines per year, in all sizes.
The new shop layout has been designed such as to allow different size
machines to be assembled simultaneously on separate lines/ stations thus
decreasing cycle times and raising assembly quality. Many of the manufacturing
bottlenecks that were faced last year due to inadequate capacity or very old
equipments, have been eliminated by this modernization investment.
The benefits of this investment will be more evident in the next 3 years
enabling the Company to dramatically ramp up its sales and production.
Business Strategy
The Company's new, low cost vertical machining centre, developed in-house, priced
at Rs 2.000 Millions will be produced in high volumes, reaching nearly 500
machines per year in the next four years. It will cater to the general
engineering SME sector. This will provide the volume base for the Machine Tools
business.
The Company currently has a market share of 87% in the gear cutting machine
business with no significant domestic competition. However, with increasing
pressure from international competitors, it plans to match their product offer
to consolidate its presence in this area.
The third thrust area is large machines that are the Company's strong point
with less domestic competition. These machines find applications in the Public
Sector, Railways, Defence, etc. Most of this business is won through tenders against
international competition by offering technically comparable machines at a
25-30% lower cost and faster delivery.
Opportunities
* Continued strong economic growth in India leading to higher industrial
investment generating demand for Machine Tools.
* Specific expansion and modernization plans of giant enterprises like
Railways, Defence production creating a sustained pipe line for large Machine
Tools where the Company has a strong presence.
* With more global automobile manufacturers establishing plants in India,
there will be a long term strong demand for gear cutting machines.
Threats, Risks and Concerns
* Japanese, Taiwanese and Chinese machines are aggressively entering the
Indian gear machine market. They have set up effective marketing bases in India
and offer technically competent, competitively priced products.
* Eastern European machining centres and vertical turning machines
continue to flood the Indian market.
* Second hand machines continue to make inroads in the SME sector.
* The capital equipment business is always fluctuating and its fortunes
depend on growth in auto as well as engineering industries.
* The Company has no control on external factors such as market
uncertainties and Government policies related to duty structure which can
seriously affect the business.
* There is a likelihood of payment collection delays for considerable
time in cases of Government supply.
Engineering Services
This activity began several years ago as 'job work' to utilize idle
Machine Tools manufacturing capacity during the then industry slow down.
However, three years ago, the Company took a decision to rapidly develop this
activity by capitalizing on its pool of engineering, fabrication, machining and
specialized manufacturing capabilities.
Industry Structure and Outlook
This mainly serves the general engineering and the automotive industry. With
Indian GDP growth between 8 and 9% and the Central and State Government's
thrust on power generation and infrastructure activity, both these segments are
experiencing strong growth. The demand for engineering products is expected to
remain robust.
Performance of Engineering
Services
The core activity is to provide specific products and/or services to industry
clients on a long term, contractual basis; generally ranging between 3 to 5
years. Essentially it provides outsourcing solutions to both domestic and
international companies. As a result, a majority of the business is on a 'value
added' basis with the end customer providing the raw materials at
their own cost. Consequently, although the activities are quite substantial,
they are under reported in the sales since they exclude the material cost. This
is progressively changing and, over the next three years, the customers are
keen to be supplied a product inclusive of material.
Currently Engineering Services does machining of automotive components
for Force Motors and TATA Motors. It is the single largest supplier (over 75%)
of machined blocks for the TATA Indica. It also manufactures large windmill
components in both Steel and SG Iron for ENERCON India as well as axle housings
for Carraro Tractors, Italy.
In '07-'08, the activity achieved a 136% rise in turnover from Rs 110.000
Millions to Rs 260.000 Millions. This was predominantly all 'value added' which
could be comparable to nearly Rs.1000.000 Millions of sales with
material.
During the year, machining of TATA cylinder blocks increased to 280 per day
against 120 per day in the previous year. The Carraro and ENERCON parts only
commenced in '07-'08. Production of both these parts took several months to
stabilize. Thus, volumes in '08-'09 are expected to increase substantially with
all lines operating at full production capacity. This activity's sales are
expected to double annually for the next three years.
Manufacturing
Capacity
The Company has invested nearly Rs.140.000 Millions during the year towards
setting up dedicated manufacturing lines for its various clients. In each case,
the Company makes the capital investment to develop and supply the product
based on along term contract with the client. The Company only invests in
machinery with alternate usability. Any equipment that is product specific and
non-useable elsewhere must be funded by the client, in case the contract
fails.
Therefore, there is very little risk of any asset loss if a specific contract
gets aborted as it deals with only a few highly reputed clients and does not
need an extensive marketing needs or infrastructure.
New Business
The target is to add between Rs.50 to Rs.1000.000 Millions of new business and
a minimum of two new, high quality clients annually for the next five years.
Also, the strategy is to diversify the business activity across industry
sectors with increasing emphasis on supply to infrastructure, earth moving and
power generation equipment.
Currently, discussions are in progress with various blue chip clients such as
Cummins, Bharat Earth Movers, BHEL, Suzlon, etc. The products being considered
are those that require a high degree of engineering capability, complex
machining and manufacturing processes, large fabrication facilities and high
capital investment so as to create a high entry barrier for competitors.
Quality
Very high process quality standard with 100% inspection at multiple stages are
maintained. It is in the final stages of receiving a specific ISO
certification, independent from the Company's existing one.
Recently, ENERCON, Germany rated the Company's windmill part operations at 63%
equivalent to their own German quality standards for both manufacturing and
process control. In fact, the products supplied by Engineering Services to both
Force Motors and TATA Motors go directly on their assembly lines.
Opportunities
* With the increasing trend, both in India and internationally, to
outsource and sub-contract manufacturing activity there is a vast amount of
opportunity to grow this business.
* With oil prices at record highs coupled with increased electricity
demand globally, the windmill sector offers vast opportunities for business
growth.
* The heavy thrust on infrastructure development and power generation is
resulting in capacity bottlenecks for major equipment suppliers forcing them to
subcontract parts and sub-assemblies.
Threats, Risks and Concerns
* This business does not face any significant threat as it is not market
driven but based on dedicated customer relationships and legal contracts.
* There is the risk of a particular customer stopping the business.
However, this exposure can be mitigated by diversifying the client base and
activities which is being done.
* The rise in raw material and input costs are currently not worrisome as
they are supplied by the client. However, in the future, as this changes to
supply with full material, working capital increases, inventory increases and
material cost increases could become concerns.
* In the event, a particular client suddenly stops business then
until the equipment is reutilized or redeployed there can be a period of loss
of revenue and profitability.
Light Utility Vehicles
Industry Structure
and Outlook
The Indian Automobile industry is divided into two main categories: Twoand
Three Wheeler and Four or More Wheeler. The latter category is further broken
up into Passenger Cars, Multi Utility Vehicles (Jeeps), Multi Purpose Vehicles
(Vans), Light Commercial Vehicles (of various ranges and tonnage) and Medium
and Heavy Trucks
The auto industry, worldwide, is directly linked to GDP growth. With the
Indian economy growing between 8 to 9% per annum, the Indian auto industry has
been growing strongly for the past 5 years. The long term demand trend for all
categories of vehicles will be good. During the past year, there has been a
temporary slow down in certain segments such as two wheelers and heavy trucks
due to rising interest rates, higher fuel prices and some demand adjustment
after three years of over 12% growth. Notwithstanding these temporary
variations, the per capita vehicle demand, in India, is very low and will
continue to grow at least 10-15% per year.
The Company has ceased to be a passenger car manufacturer since '00 and is now
engaged in two segments of the four wheeler category, that have shown strong
growth:
1. Multi Purpose Vehicles
2. Light Commercial Vehicles(LCVs-Pick-up trucks, with less than 3.5
tonnes GVW)
Multi Purpose Vehicles (Vans)
The MPV segment is currently dominated by Marud Suzuki, having an 89 % market
share. It has two products: the Omni and Versa both offered with only petrol
engines. Recently, TATA's have introduced a low end, people mover small diesel
van based on its ACE mini truck platform known as Magic and a big size diesel
van known as Winger. Both are well received showing a clear market opportunity
for diesel passenger vans.
This segment has no multi national players and presents a good opportunity to
carve out a niche market share in diesel vans. The Premier Sigma is an ideal
sized diesel van.
The rise of new industries such as IT BPO, Call Centres as well as the increase
in tourism is creating a strong need for multi seater passenger vans. Also the
national emphasis on healthcare as well as the growth of organized retail will
give rise to demand for Ambulances and Cargo vans.
Pick-up trucks (LCVs < 3.5 Mt GVW)
The small, Pick-Up truck market is currently dominated by only two domestic
players: TATA's with the ACE Mini Truck and Mahindra with its MAXX pick-up.
Here again, there is no multi national presence, nor any forecast in the near
future. The TATA ACE is a small, intra-city vehicle. With less than 1 ton
carrying capacity mainly replacing three wheeler cargo carriers in the market
place. The Mahindra MAXX is at the top of the price band in the 2 tonner
segment in terms of price.
There is a clear market opportunity for a modern, fuel efficient pick-up truck
priced between the ACE and the MAXX that can be used for both intra-city as
well as inter city goods transportation. The Premier Roadster is a 1.4 tonner
modern, fuel efficient Pick-up fits this gap in size and price.
The implementation of high way infrastructure combined with increasing
disallowance of large trucks entering city/town limits, the goods
transportation model is increasingly becoming 'hub and spoke' with a greater
need for small feeder vehicles for 'last mile' delivery. With many industries
demanding 'just in time' supplies from their vendors, there is a growing demand
for small, fuel efficient goods vehicles to commute several times a day. Indian
cities and towns with narrower roads and lanes need a small garbage removal
trucks, retail delivery vehicles etc.
Performance
During '07-'08 the light utility vehicle activity sold 326 vehicles with a
turnover of Rs. 110.500 Millions but incurred a loss of Rs. 29.900 Millions due
to inadequate volumes and other start up expenses. Its performance was affected
due to the management's proactive decision to voluntarily curtail production
for three quarters of the year in order to make certain product modifications
based on market feedback.
The Premier Roadstar, a small pick-up truck, originally a Mitsubishi design,
had Mac Phearson struts for its front suspension. This is a significant technological
improvement over the conventional leaf spring suspension adding to driver
comfort and ease of steering. However, in the Indian context, the vehicles were
being overloaded by nearly 50-100% of their permitted payload and driven on
poor roads, resulting in struts breakage, which was a safety hazard.
Consequently, the Company had to take a retrograde step and re-engineer the
vehicle with a leaf spring front suspension in order to make the product
commercially acceptable. This reengineering process took most of the last year
thereby affecting sales.
The Premier Sigma, a passenger van, had to be changed from a four speed to a
five speed transmission as per market demand. This is now duly homologated and
certified by ARAI, a Government authority.
Therefore, though the Company has been reporting its automotive segment in
commercial production, in fact, even last year it has been in a 'project'
stage.
The Company has renewed its relationship with CMC, Taiwan, an affiliate of
Mitsubishi, Japan for sheet metal body parts supply for its van and Pick-up.
Both these products are made from the same vehicle platform thereby achieving
substantial synergy in parts commonality.
During '08-'09 the target is to achieve cash break even.
Product Development
Due to its long history and experience in the automobile business, particularly
its proven strength in adaptive engineering, the Company has developed two
commercially saleable products - the Sigma Van and the Roadstar Pick-up with
several variants, all duly homologated and certified by ARAI, Pune
The Sigma passenger van is available in 7, 8 and 9 seater configuration, both
AC and without AC options with a five speed transmission. The Company has also
developed an Ambulance (Sigma Lifeline) and a Cargo (Sigma Express) variant of
this Sigma van.
Similarly, in the case of the Roadstar, it is available in both EURO II and
EURO III versions. The Company has developed a tipper version and is currently
working on a fire truck and refrigerated carrier.
A Roadstar CNG version is under homologation. This will be very useful in
cities like New Delhi (NCR) where diesel commercial vehicles are totally
banned. The Company is working on several other applications in order to widen
the marketability of these products.
Manufacturing Capacity
The Company has fully established its vehicle assembly capacity including the
body shop, paint shop (part), vehicle assembly line, engine and gear box
assembly. Currently, the installed capacity is 15,000 vehicles per annum which
is more than adequate to meet present needs.
This entire project has been conceived on the premise of achieving volumes and
profitability by exploiting niche markets. Since niche markets, by definition,
have smaller volume potential, the business model is based on low capital
investment and a high degree of outsourced parts and components. This delivers
a low break even volume and thereby reduces capital and operating risk.
This business model is not unique to Premier. In fact, there are two well
established vehicle manufacturing models worldwide: high investment-high volume
manufacturing and low investment-low volume assembly. The former only makes
sense if the targeted volumes are in excess of 50,000 per annum; ideally over
100,000. For anything lower than 50,000, the assembly model followed by the
Company is more viable.
Currently, the total capital investment made by the Company in this project is
about Rs. 250.000 Millions including the assembly plant, technical know how,
vendor tooling, homologation etc.
Marketing and Dealer Network
The Company has set up a new dealer network and currently has 32 operative
dealers located in the states of Gujarat, Maharashtra, Goa, Andhra Pradesh,
Kerala, Tamil Nadu and Karnataka. The current focus is to establish the
products in West and South India before expanding to the North and East. The
dealership target is to reach 76 by December '08 and 100 by March'09, creating
an all India network.
The Company has also set up a zonal management structure that overseas parts,
service and dealer training regularly. The Company has started advertising and
promotional activities regionally and this is beginning to create product
awareness and promote sales. The process of re-establishing the Company and
products is slow but steady.
The biggest challenge the Company faces, is to establish a strong vehicle
financing partnership.
Currently, it is in dialogue with various finance companies and banks. However,
not having a captive finance company like others is definitely proving to be a
deterrent to sales growth.
Opportunities
* With India's economy continuing to grow at 8 to 9 %, there will be a
steady, rising demand for passenger vans and small pick-up trucks.
* With more and more towns and cities banning large trucks from entering
city limits, the demand for small feeder vehicles will continue to
increase.
* The Central and State Governments are encouraging huge
investments through Municipal Corporations' in waste and disaster management
systems. Due to smaller roads in many towns, there is a strong demand for
smaller garbage removal trucks that can ply in these areas.
* Similarly, there is also heavy public investment being made in the
health sector. This will provide a good opportunity for the ambulance variant
of the Sigma van.
Threats, Risks and Concerns
* The key concern to increasing volumes is the easy availability of
vehicle finance. Established finance companies wait for a product to get
established and proved in the market before starting to whole heartedly finance
it. Ironically, to become well established in the market, the product requires
a strong financing package; particularly in the LCV sector.
* The spiraling costs of crude oil will dramatically impact both
automobile sales and economic growth as a whole. This would directly impact
demand for the Company's products.
* The hardening of consumer interest rates from 8.5 % two years ago to 11.5
% currently has dramatically increased the monthly EMI outgo for vehicle
buyers. With rising defaults, finance companies have become more discerning
about disbursing new vehicle loans and this will directly affect vehicle
sales.
* The prices of all key materials such as steel, non ferrous metals,
rubber and plastic have witnessed significant increases directly impacting the
product cost structure. Given the current soft demand scenario, it may not be
able to pass these increases onto the customer, thereby impacting
profitability.
* Increasing stringency of emission standards and safety regulations can
add to the product cost.
* Sheet metal parts are currently imported from Taiwan for both products.
Any devaluation of the Rupee against the US Dollar could result in an increase
in the product cost.
* Competitive activities have increased in all segments of the Indian
automotive market. While there is currently lesser competition in the MPV and
LCV segments, this could change in the future
Fixed Assets:
- Freehold Land
- Building
- Plant and Machinery and Equipments
- Cars and Vehicles
- Furniture and Office Equipments
- Dies and Jigs
AS PER WEBSITE
Profile:
Established in 1944, Premier was one of the first Indian companies to
start making automobiles. In collaboration with Chrysler Corporation, USA,
India’s first car rolled out of the Premier factory in 1947. In collaboration
with Fiat SpA, Italy, Premier first started assembling the Fiat 500 in India.
In 1954, came the Fiat 1100, one of the most popular models ever produced.
Over the years, the Fiat car became increasingly Indian in content.
Gradually, Premier trained a huge task force to do highly specialised jobs. And
built up a strong technologies base, while increasing its capacity many-fold. Progressive
indigenisation continues and in 1972, a virtually 100% indigenous car had
finally arrived, manufactured by Premier under its own name.
Apart from the most popular car in
India, the Premier Padmini, Premier also manufactured the country’s widest
range of commercial vehicles for a variety of road transport applications.
Important
landmarks :
- First Indian automobile company founded by the visionary and entrepreneur at par excellence, late Mr Walchand Hirachand in 1944
- Pioneered the manufacture of commercial vehicles of
well known brands, Dodge, fargo for use by the Defence Department of
Government of India. The first such vehicle was rolled out at Kurla works
on 15th March, 1947
- Pioneered the assembly of popular and well known
passengers cars like Dodge, Desots and Plymouth at Kurla works
- The first Indian passenger car company to set up a
Press plant at its Dombivli plant, in western India
- First to produce a 100% indigenized car in 1968
- Acquired modern machine tools manufacturing unit from
Walchand Group in August, 1987, essentially for captive use to meet the
need of engine and transmission components
- The Machine Tool Division manufactures sophisticated
and precision machine tools, machining centres, widely used by leading
auto companies like TELCo, Bajaj Auto, Bajaj Tempo, Ashok Leyland, TVS
- Its special purpose machines are widely used by
various Defence establishments like ordinance factories, railway work
shops, etc.
- The first company to introduce diesel taxis in the
city of Mumbai
- The first company to introduce the concept of cool
cabs (A/C Taxis) in Mumbai city.
Seth Walchand Hirachand (1882 - 1953) was
the Founder of this illustrious group of companies, most of which assumed the role
of nation building activities in the years to come. Coming from a rural
background of Solapur in Maharashtra, Walchand Hirachand had a dream and the
vision of independent India that is borne out of the true Indian enterprise,
Indian skills and Indian capability.
He realized the importance of transport for the growth of the Indian
Economy, mobility of people and goods and improvement of people's living
condition.
In the realization of this dream, he ventured into areas which made
India's industrial development strong and focused at a time when everything had
an anti-Indian wave. He was determined to spread his wings to all sections of
the transport industry. He established Hindustan Aircrafts Limited in Bangalore
in a record time to assemble and repair war planes. In the post independent
era, it was nationalized for strategic reasons and today it is called Hindustan
Aeronautics Limited and occupies a place of pride.
Seth Walchand also focused on the shipping and ship building industries
and established the Scindia Steam Navigation Company Limited in Mumbai and the
Hindustan Shipyard Limited at Vishakhapatnam
Venturing into surface transport, he established Premier Automobiles
Limited (now known as Premier Limited) in 1944, which initially started assembling
Chrysler vehicles, to become the pioneers in the Indian automotive field.
Seth Walchand also setup ventures in heavy engineering, in steel pipes
and pen-stock, in large and medium engineering industries, and also contributed
to the farming sector to produce sugar from sugar cane and to develop agro
related industries. These industries gave the required fillip when India
achieved independence and provided the basics in infrastructural needs apart
from providing employment to a large section of the people. He realized that
India cannot rest on its past glories but must move forward intelligently. He
initiated and set up a number of educational institutions to facilitate this
dream.
Milestones 
|
Year |
Events |
|
1944 |
PREMIER was incorporated |
|
1946 |
PREMIER was appointed by the Government of India, Distributors on lease
and lend military dodge trucks |
|
1947 |
Construction of the Assembly Building was completed in Kurla. An
Agreement was executed with CHRYSLER, U.S.A. for manufacture of dodge cars |
|
1950 |
PREMIER entered into an Agreement with FIAT Company, Italy, for the
assembly and progressive manufacture of FIAT cars in India. PREMIER commenced
assembling FIAT cars in the Company's factory at Kurla |
|
1951 |
With the approval of CHRYSLER CORPORATION, PREMIER indigenised the
manufacture of components, such as Radiator, Muffler, etc. required for dodge
cars |
|
1954 |
PREMIER manufactured and marketed FIAT 1100 cars |
|
1956 |
The recommendations of Tariff Commission on the price structure of
automobiles manufactured in this country, were finalised and submitted to the
Government of India by the Tariff Commission. PREMIER further indigenised the
components like engines, Chassis frames, leaf etc. for FIAT 1100 cars.
PREMIER indigenised the production of petrol engines required for CHRYSLER
Group Cars and petrol trucks |
|
1959 |
PREMIER further progressed indigenisation of remaining components for
manufacture of FIAT cars in India |
|
1962 |
Agreement signed with M/s Hendri Meadows, England, for manufacture of
Meadows Engines to be used in the automobiles |
|
1963 |
PREMIER acquired land at Dombivli for setting up a Press Plant for
sheet metal components and a factory for New Car project |
|
1964 |
PREMIER commenced manufacture of trucks and supplied the vehicles to
the defence Department |
|
1965 |
PREMIER completely indigenised all the components for FIAT cars |
|
1969 |
PREMIER commenced export of commercial vehicles |
|
1973 |
PREMIER commenced marketing of the cars under the brand name
"PREMIER", after the agreement with FIAT expired |
|
1975 |
Price control of the passenger cars has been removed from 1st January,
1975 |
|
1982 |
The Company undertook Modernization and Replacement Programme by
setting up new production facilities at Dombivli |
|
1984 |
PREMIER entered into a Technical Collaboration Agreement with Nissan
for A-12 Engine for NE car |
|
1985 |
PREMIER launched a new model car, namely, 118 NE. This car was
manufactured at its Dombivli plant in the newly set up New Car Project |
|
1987 |
PREMIER acquired the Machine Tool Division, manufacturing
sophisticated CNC Machine Tools at Chinchwad |
|
1991 |
PREMIER launched Premier diesel vehicles for taxies and private use |
|
1993 |
PREMIER launched 118 NE fitted with diesel engine |
|
1995 |
PREMIER signed a Technical Collaboration Agreement with FIAT, S.P.A.,
Italy, for manufacture of Uno cars at Kurla |
|
1996 |
PREMIER launched Uno car manufactured at Kurla Plant |
|
1997 |
Joint Venture formed with FIAT S.p.A., Italy, known as |
|
April '98 |
Restructuring of business with FIAT |
|
Dec '98 |
Prototype Varica Van was procured from China Motors Corporation,
(CMC), an affiliate of Mitsubishi |
|
May '99 |
CMC team visits PREMIER |
|
Aug '99 |
PREMIER signs agreement with Automobile Peugeot for TUD5-Engine |
|
April '00 |
PREMIER signs Techinical assistance agreement with CMC for Van and
Pick - Up |
|
May '01 |
CMC Vehicles submitted to ARAI for homologation |
|
Oct '01 |
Strategic decision to move operations to Pune |
|
Feb '02 |
Homologation certificate received from ARAI |
|
Jan '03 |
Contract with TATA Motors for painting Van and Pick - Up Bodies in
their plant |
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.43.23 |
|
UK Pound |
1 |
Rs.80.89 |
|
Euro |
1 |
Rs.63.80 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
9 |
|
PAID-UP CAPITAL |
1~10 |
8 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
8 |
|
--MARGINS |
-5~5 |
7 |
|
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 |
NO |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
70 |
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 |
|