MIRA
INFORM REPORT
|
Report Date : |
23.08.2008 |
IDENTIFICATION
DETAILS
|
Name : |
ESSEL PROPACK LIMITED |
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Registered Office : |
P.O. Vasind, Taluka - Shahapur, Dist. Thane, Maharashtra – 421 604 |
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Country : |
India |
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Financials (as on) : |
31.12.2007 |
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Date of Incorporation : |
22.12.1982 |
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Com. Reg. No.: |
11-28947 |
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CIN No.: [Company
Identification No.] |
L74950MH1982PLC028947 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
MUME01100B |
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PAN No.: [Permanent
Account No.] |
AAACE1568L |
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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 : |
Manufactures and Sellers of Composite Laminated Collapsible Tubes, Laminates and Plastic Films. |
RATING &
COMMENTS
|
MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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|
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 |
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Maximum Credit Limit : |
USD 29000000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a well-established and reputed company and a part of Excel
Group. The company is progressing well. Directors are reported as experienced
and respectable businessmen. Trade relations are reported as fair. Business
is active. Payments are usually correct and a s per commitments. Fundamentals are strong and healthy. The company can be considered normal for business dealings at usual
trade terms and conditions. The company can be regarded as a promising business partner in a
medium to long run. |
LOCATIONS
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Registered Office : |
P.O. Vasind, Taluka - Shahapur, Dist. Thane- 421 604, Maharashtra, India |
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Tel. No.: |
91 – 22 – 2493 3280 / 3281 / 2493 9686 / 9689 |
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Fax No.: |
91 – 22 – 2496 3137/24935188 |
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E-Mail : |
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Website : |
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Head Office : |
3rd Floor, Satam
Estate, Above Bank of Baroda, Cardinal Gracious Road, Chakala, Andheri
(East), Mumbai - 400 099, Maharashtra, India |
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Tel. No.: |
91-22-2821 5168,
2820 2108, 2820 2114 |
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Fax No.: |
91-22-2839 2259,
2837 5646 |
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E-Mail : |
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Administrative Office : |
135, Continental Building, Dr. A. B. Road, Worli, Mumbai - 400 018, Maharashtra, India |
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Tel. No.: |
91-22-56535653/ 56535700 |
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Fax No.: |
91-22-24963137 |
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Corporate Office : |
10th Floor, Times Tower, Kamala City, Senapati Bapat Marg Lower Parel, Mumbai – 400 013, Maharashtra, India |
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Tel. No.: |
91-22-2481 9000 / 2481 9200 |
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Fax No.: |
91-22-2496 3137 / 2491 4649 |
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Factories : |
v Vasind, Taluka Shahapur, District Thane, Maharashtra, India v Goa, India v Silvassa, Union Territory of Dadra & Nagar Haveli, India v B-1/2, MIDC, Murbad, Dist. Thane - 421406, Maharashtra, India v Village Vadali, P.O. Kudus, Taluka - Wada, Dist. Thane - 421 312, Maharashtra, India |
|
Rest are located at
: |
· Puducherry, · Uttarakhand, ·
Nalagarh, |
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Unit : |
912, Raheja
Centre, Free Press Journal Road, Nariman Point, Mumbai - 400 021,
Maharashtra, India |
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Tel. No.: |
91-22-2288 1568, 2288
1569, 2288 4527, 2282 5163 |
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Fax No.: |
91-22-2282 5484 |
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E-Mail : |
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Factories
(Overseas) : |
· China · Columbia · Egypt · Germany · Indonesia · Mexico · Philippines · Poland · Russia · Singapore · UK · USA |
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Overseas Offices : |
v Guangzhou (China) v Cairo (Egypt) v Singapore v Germany v Nepal v Philippines v Indonesia v Venezuela v Colombia v Mexico v Mauritius v Costa Rica v USA - Danville |
DIRECTORS
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Name : |
Mr. Subhash Chandra |
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Designation : |
Chairman |
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Name : |
Mr. Cyrus Bagwadia |
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Designation : |
Managing Director |
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Date of Birth/Age : |
52 years |
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Qualification : |
B.Sc. (Hons.), DPM and DBM |
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Experience : |
29 years |
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Date of Appointment : |
17.11.1995 |
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Other Directorships : |
Du Pont (Far East Asia) – Business Manager |
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Name : |
Mr. Ashok Kumar Goel |
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Designation : |
Vice Chairman and Managing Director |
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Date of Birth/Age : |
38 years |
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Qualification : |
B.Com. |
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Experience : |
18 years |
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Date of Appointment : |
01.07.1988 |
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Name : |
Mr. J. M. Fernandes |
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Designation : |
Director |
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Date of Ceasing : |
14.03.2006 |
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Name : |
Mr. Vasant Kumar Badgamia |
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Designation : |
Director |
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Date of Ceasing : |
14.03.2006 |
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Name : |
Mr. Devendra Ahuja |
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Designation : |
Director |
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Name : |
Mr. Andreas Schwyn |
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Designation : |
Director |
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Name : |
Mr. Beat Buehlmann |
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Designation : |
Director |
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Date of Ceasing : |
07.12.2005 |
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Name : |
Mr. Boman Moradian |
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Designation : |
Additional Director |
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Date of Appointment : |
14.03.2006 |
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Name : |
Mr. Tapan Mitra |
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Designation : |
Director |
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Name : |
Mr. K V Krishnamurthy |
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Designation : |
Director |
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Name : |
Mr. Anand Deshpande |
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Designation : |
Director – Human Capital (Global) |
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E-Mail : |
KEY EXECUTIVES
|
Name : |
Mr. Cherian Kenneth Thomas |
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Designation : |
Vice president – Marketing (AMESA), CEO and Whole Time
Director, Packaging India Private Limited |
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E-Mail : |
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Name : |
Mr. R. Chandrasekhar |
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Designation : |
President - Medical Devices and Specialty Packaging |
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Name : |
Mr. M.R. Ramasamy |
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Designation : |
Director - Technology and New Projects |
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Name : |
Mr. Sanjay Bhasin |
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Designation : |
CEO - Tubes and Laminates Business |
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Name : |
Mr. A. V. Ganapathy |
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Designation : |
Chief Finance Officer (Global) |
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Name : |
Mr. Zoeb Adenwala |
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Designation : |
Chief Information Officer (Global) |
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Name : |
Mr. M.K. Banerjee |
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Designation : |
Director Creativity and Innovation (Global) |
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Name : |
Mr. Ernest Louis |
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Designation : |
Director – Human Capital (global) |
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Name : |
Mr. Ajay Nagle |
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Designation : |
Vice President - Legal and Company Secretary |
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Name : |
Mr. Edward Luo Zhiyong |
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Designation : |
Vice President - Tubes and Laminates Business (East Asia
Pacific) |
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Name : |
Ms. Evelyn Tweedlie : |
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Designation : |
Vice President - Tubes and Laminates Business (Europe) |
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Name : |
Mr. Ted Sojourner |
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Designation : |
Vice President - Tubes and Laminates Business (Americas) |
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Name : |
Mr. Nitin Matani |
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Designation : |
CEO - Tacpro Inc. and Avalon Medical Services |
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Name : |
Mr. Vinay |
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Designation : |
Financial Controller (Global) |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
|
Names of Shareholders
(31.03.2008) |
No. of Shares |
Percentage of
Holding |
|
Shareholding of Promoter and Promoter Group |
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Indian |
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Individuals/Hindu Undivided Family |
14615 |
0.009 |
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Bodies Corporate |
57937030 |
36.997 |
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Foreign |
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Individual (Non-Resident Individuals/Foreign Individuals) |
89305 |
0.057 |
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Bodies Corporate controlled by
promoters |
34228305 |
21.857 |
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Public shareholding |
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Institutions |
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Mutual Funds/UTI |
13909354 |
8.882 |
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Financial Institutions/Banks |
550 |
0.000 |
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Insurance Companies |
2756720 |
1.760 |
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Foreign Institutional Investors |
7445022 |
4.754 |
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Non-institutions |
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Bodies Corporate |
11973687 |
7.646 |
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Individuals – i. Individual shareholders holding nominal share capital up to Rs.
0.100 Million |
20709308 |
13.225 |
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ii. Individual shareholders holding nominal share capital in excess of
Rs. 0.100 Million |
5238406 |
3.345 |
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Non resident Individuals |
2164653 |
1.382 |
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OCB |
24800 |
0.016 |
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Trusts |
109375 |
0.070 |
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TOTAL |
156601130 |
100.000 |
BUSINESS DETAILS
|
Line of Business : |
Manufactures and Sellers of Composite Laminated Collapsible Tubes, Laminates and Plastic Films. |
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Products : |
v Laminated Tubes v
Seamless Tubes (For high-end cosmetics) v
Closures v Webs
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PRODUCTION STATUS
(As on 31.12.2007):-
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Particulars |
|
Unit |
Installed
Capacity |
Actual
Production |
|
Laminated and Co-Extruded Tubes Nos. |
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Million Nos. |
2114 |
1769.88 |
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Laminates |
|
MT |
4000 |
7202.07 |
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Plastic Film |
|
MT |
6690 |
5376.78 |
GENERAL
INFORMATION
|
Customers : |
Some of its’
major customers are :- v Johnson and
Johnson Limited v Cavinkare
Limited v Balsara Hygiene
Products Limited v Duphar –
Interfran Limited |
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No. of Employees : |
About 1200 |
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Bankers : |
v State Bank of India v Standard Chartered Grindlays Bank Limited v Banque National De Paris v Corporation Bank v HDFC Bank Limited v Credit Lynnais v BNP Paribas v BS Bank Limited v Standard Chartered Bank v DBS Bank Limited |
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Facilities : |
Secured Loans :
Notes :- 1. Term Loan from
Banks (i) Rupee Loan Secured by way of first charge ranking pari passu on the entire fixed assets of the Company, both present and future excluding land at Goa. (ii) Foreign
Currency Loan Secured by way of first charge ranking pari passu on the entire fixed assets of the Company. Charge is yet to be registered. (iii) Repayable
within one year Rs 433.188 millions
(Rs 216.600 millions) 2. Working Capital
Demand Loan/Cash Credit from Banks Secured by way of hypothecation of all inventories both on hand and in transit, book debts and other receivables of the Company. Also secured by way of second charge ranking pari passu on immovable properties of the Company at Wada and Vasind. 4.
Other Secured
Loan Secured by way of hypothecation of Vehicle. Unsecured Loans
:
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Banking
Relations : |
Good |
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Auditors : |
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Name 1 : |
M. G. Bhandari and Company Chartered Accountants |
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Name 2 : |
MGB and Company Chartered Accountants |
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Joint Ventures : |
· P.T. Lamipak Primula, Indonesia · Essel Deutschland GmbH and Co., KG Germany · Essel Deutschland Management GmbH, Germany ·
Bericap India Private Limited, India |
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Associates/Subsidiaries : |
Associates · Zee Telefilms Limited · Essel World · Essel Water Kingdom · Essel Deutschland GmbH, Germany · Siticable Network Limited · Pan India Paryatan Limited · Aqualand (India) Limited · Briggs Trading Company Private Limited · Churu Trading Company Private Limited · Ganjam Trading Company Private Limited · Continental Drug Company Private Limited · Premier Finance and Trading Company Private Limited · Edison Continental Laboratories Company Private Limited · E-City Entertainment (India) Private Limited · Ayepee Lamitubes Limited · Dhariya Properties Private Limited · Metropolitan Leasing Limited · Supel Tex Limited · Uddar Trees Growing Private Limited · Pan India Infravest Network Private Limited · Essel Propack Philippines, Inc, Philippines · MIL de Panama S.A., Panama · Packtech Limited, Mauritius · Arista Tubes Limited, UK · Essel Propack UK Limited, UK (formerly known asTelcon Packaging Limited, UK) · Essel Propack de Venezuela, C.A., Venezuela A · Essel de Mexico, S.A.de C.V., Mexico · Tubo pack de Colombia S.A., Colombia · Essel Propack LLC, Russia · Avalon Medical Services Pte. Limited, Singapore · Essel Propack Polska Sp.Z.O.O., Poland · Tacpro Inc., USA · Tactx Medical Inc., USA · Produxx Inc., USA · Arista Tubes Inc., USA · Guangzhou Propack Company Limited, China* · Packaging India Private Limited, India · The Egyptian Indian Company for Modern Packaging S.A.E., Egypt · Essel Propack MISR for Advanced Packaging S.A.E., Egypt · Essel Packaging (Guangzhou) Limited, China ·
Guangzhou Propack Company Limited, China* · Lamitube Technologies Limited, Mauritius ·
Lamitube Technologies (Cyprus) Limited, Cyprus Subsidiaries · Essel Packaging (Guangzhou) Limited, China · Egyptian Indian Company for Modern Packaging S.A.E, Egypt · Essel Packaging (Nepal) Private Limited, Nepal · Lamitube Technologies Limited · Ayepee Lamitubes Limited, · Briggs Trading Company Private Limited, · ChuruTrading Company Private Limited, · Continental Drug Company Private Limited, · Pan India Network Infravest Private Limited, Essel Corporate · Resources Private Limited, · Ganjam Trading Company Private Limited, · Essel Infra Projects Limited (formerly Pan India Paryatan Limited), · Premier Finance and Trading Company Limited |
CAPITAL STRUCTURE
(As on
31.03.2007):-
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
200000000 |
Equity Shares |
Rs. 2/- each |
Rs.400.000
millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
156601130 |
Equity Shares |
Rs. 2/- each |
Rs.313.202
millions |
Out of above:-
(i) 65166915 Equity Shares of Rs.2 each fully paid up are issued as Bonus Shares by Capitalisation of General Reserves and Securities Premium.
(ii) 34316610 Equity Shares of Rs.2 each fully paid up were allotted for consideration other than cash.
Less: Calls in Arrears (Other than Directors)
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.12.2007 |
31.12.2006 |
31.12.2005 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
313.131 |
313.129 |
313.126 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
5313.559 |
5183.223 |
5129.804 |
|
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
5626.690 |
5496.352 |
5442.930 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
1850.371 |
1684.147 |
1011.830 |
|
|
2] Unsecured Loans |
2082.178 |
795.234 |
442.884 |
|
|
TOTAL BORROWING |
3932.549 |
2479.381 |
1454.714 |
|
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DEFERRED TAX LIABILITIES |
129.810 |
148.801 |
150.917 |
|
|
|
|
|
|
|
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TOTAL |
9689.049 |
8124.535 |
7048.561 |
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APPLICATION OF FUNDS |
|
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|
|
|
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|
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|
|
|
FIXED ASSETS [Net Block] |
1523.462 |
1467.352 |
1412.554 |
|
|
Capital work-in-progress |
155.662 |
164.509 |
97.703 |
|
|
|
|
|
|
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INVESTMENT |
5744.316 |
5509.039 |
4881.941 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
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CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
451.135
|
430.434 |
364.226
|
|
|
Sundry Debtors |
593.330
|
420.586 |
298.780
|
|
|
Cash & Bank Balances |
55.836
|
34.605 |
32.872
|
|
|
Other Current Assets |
256.899
|
33.914 |
0.000
|
|
|
Loans & Advances |
1581.288
|
855.999 |
1088.948
|
|
Total
Current Assets |
2938.488
|
1775.538 |
1784.826 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
404.277
|
425.321 |
335.824
|
|
|
Provisions |
268.602
|
366.582 |
792.639
|
|
Total
Current Liabilities |
672.879
|
791.903 |
1128.463 |
|
|
Net Current Assets |
2265.609
|
983.635 |
656.363
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
9689.049 |
8124.535 |
7048.561 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.12.2007 |
31.12.2006 |
31.12.2005 |
|
|
Sales Turnover |
3114.702 |
2825.435 |
2528.959 |
|
|
Other Income |
197.212 |
114.206 |
87.820 |
|
|
Total Income |
3311.914 |
2939.641 |
2616.779 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
555.362 |
593.502 |
682.864 |
|
|
Provision for Taxation |
182.437 |
183.040 |
223.190 |
|
|
Profit/(Loss) After Tax |
372.925 |
410.462 |
459.674 |
|
|
|
|
|
|
|
|
Export Value |
266.355 |
284.509 |
368.157 |
|
|
|
|
|
|
|
|
Imports : |
|
|
|
|
|
|
Raw Materials |
642.082 |
644.194 |
514.502 |
|
|
Stores & Spares |
57.476 |
54.640 |
65.587 |
|
|
Capital Goods |
107.512 |
311.792 |
414.365 |
|
Total Imports |
807.070 |
1010.626 |
994.454 |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Cost of Goods Sold |
1327.969 |
1190.198 |
335.117 |
|
|
Manufacturing Expenses |
424.431 |
383.019 |
139.811 |
|
|
Administrative Expenses |
172.736 |
184.223 |
1014.639 |
|
|
Salaries, Wages, Bonus, etc. |
NA |
NA |
218.145 |
|
|
Interest |
NA |
NA |
(20.959) |
|
|
Personnel Cost |
369.803 |
264.135 |
NA |
|
|
Selling and Distribution Expenses |
56.289 |
48.744 |
NA |
|
|
Power & Fuel |
199.915 |
57.469 |
NA |
|
|
Depreciation & Amortization |
200.827 |
205.935 |
209.693 |
|
|
Other Expenditure |
4.582 |
12.416 |
37.469 |
|
Total Expenditure |
2756.552 |
2346.139 |
1933.915 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
31.03.2008 |
30.06.2008 |
|
Type
|
|
1st Quarter |
2nd
Quarter |
|
Sales Turnover |
|
756.000 |
783.900 |
|
Other Income |
|
0.000 |
86.100 |
|
Total Income |
|
756.000 |
870.000 |
|
Total Expenditure |
|
606.000 |
653.700 |
|
Operating Profit |
|
150.000 |
216.300 |
|
Interest |
|
52.000 |
62.300 |
|
Gross Profit |
|
98.000 |
154.000 |
|
Depreciation |
|
48.000 |
49.700 |
|
Tax |
|
16.000 |
36.100 |
|
Reported PAT |
|
34.000 |
68.200 |
KEY RATIOS
|
Year |
31.12.2007 |
31.12.2006 |
31.12.2005 |
|
Debt-Equity Ratio |
0.58 |
0.36 |
0.22 |
|
Long Term Debt-Equity Ratio |
0.39 |
0.29 |
0.18 |
|
Current Ratio |
1.22 |
1.17 |
1.44 |
|
TURNOVER RATIOS |
|||
|
Fixed Assets |
0.80 |
0.78 |
0.79 |
|
Inventory |
7.66 |
7.83 |
8.28 |
|
Debtors |
6.66 |
8.65 |
8.71 |
|
Interest Cover Ratio |
2.35 |
3.77 |
6.41 |
|
Operating Profit Margin(%) |
34.62 |
32.59 |
35.95 |
|
Profit Before Interest And Tax Margin(%) |
28.67 |
25.97 |
28.55 |
|
Cash Profit Margin(%) |
17.00 |
19.82 |
23.62 |
|
Adjusted Net Profit Margin(%) |
11.05 |
13.20 |
16.22 |
|
Return On Capital Employed(%) |
11.04 |
10.86 |
11.81 |
|
Return On Net Worth(%) |
6.71 |
7.51 |
8.20 |
LOCAL AGENCY
FURTHER INFORMATION
HISTORY
The company was incorporated on 22nd December, 1982 at Thane
in Maharashtra having Company Registration Number 28947.
The company was promoted by Essel group and is the World's largest
Packaging Company in laminated tubes. The company provides packaging solutions
to toothpaste, cosmetics, pharmaceuticals sectors to top multinational
customers.
The company was the first company to introduce laminated tubes in India.
The company started in 1984 with an integrated facility to manufacture
laminated tubes and laminates in India.
In 1993 the company ventured to become a global player by setting its
first overseas venture in Egypt. Currently the company has an 80% stake in this
Joint venture. In 1997 the company formed a wholly owned subsidiary in
Guangzhou, China. In 1999 the company set up a joint venture in Dresden Germany
in which it has a 24.9% stake. The company also set up a wholly owned
subsidiary in Nepal in the year 2000.
In December, 2000 the company acquired the tubing operations of the
Propack group. The company was the fourth largest laminated tube manufacturer
in the world with operations in China, Philippines, Columbia, Venezuela,
Indonesia and Mexico.
The company's tubes find their way into toothpaste's, cosmetics,
pharmaceuticals, foods, etc. More precisely, multinationals like Unilever,
Colgate-Palmolive, SmithKline Beecham, Proctor and Gamble, Kiwi TTI / Sara Lee,
Revlon, Oriflame, etc. are some of its esteemed customers. Besides India, it
has set its eyes on the neighbouring countries like China, Nepal, Egypt and
some others, to ensure that it is able to make the most out of the culture to
substitute aluminium tubes with laminated collapsible tubes for packing. The
company has been awarded the ISO 9002 certification for its manufacturing and
marketing operations.
The acquisition of Propack Mauritius has been completed through
cash-cum-stock deal. The company made a preferential allotment of 6863222
equity shares to Arfen Hsu at a premium of Rs. 421/-
In January, 2001 the company has issued bonus shares in the ratio of 3:5
(i.e. 3 bonus shares for every 5 equity shares with held). Moreover as a
diversification plan the company has set up a 51:49 joint venture company with
Bericap Holding GmbH of Germany to manufacture hi-tech closures for Carbonated
Soft Drinks
The company started its operations 18 years ago with a single location,
producing 53 million tubes. Today, it
has the total capacity of around 3 billions tubes. It is currently present in 10 countries and 15 manufacturing
locations.
Recently the company has entered into a five-year contract with Procter
and Gamble (P and G) in US for 100% of their requirements of tubes. For this the company will be setting up a
wholly owned subsidiary in US with an investment of about US $ 20.000 millions.
BUSINESS
Subject is engaged in manufacturing and selling of Composite Laminated Collapsible
Tubes, Laminates and Plastic Film.
The year in review
In the face of an
extremely challenging business environment, the Company sustained the growth
momentum with total revenue for the year increasing to Rs. 12181 million, an
increase of 18.4% over the previous year. Operating Cost was impacted by
increased cost of ramping up of new facilities in USA and Poland, from which
significant revenue stream is yet to start and as well as lag in passing
through escalating raw material costs. Consequently, Profit after Tax for the
year is lower on consolidated global operations at Rs.608 million compared to
Rs.985 million of previous year.
The Company's
revenues in India increased to Rs.3312 million in the year 2007, registering a
growth of 12.7% over the previous year. The Operating Profit increased by 10.6%
to Rs.961 million in the year 2007. Firming up of global interest rates coupled
with higher borrowings to finance new capacities and acquisitions both at home
and abroad contributed to increase in interest costs. Consequently, profit
after tax for the year at Rs.373 million was 9% lower than previous year.
The Company continues to pro-actively identify the changing need of its
customers, develop tube solutions and encourage conversion from conventional
packaging solutions into tubes. The above strategy has seen more product
categories being launched in tube solutions format, for sectors such as
pharmaceutical, cosmetic and food. During the year, the Company successfully
developed and launched Oval tubes for the first time in Indian market.
The Company will continue to focus on efficiency improvement programmes and
capacity utilization to improve the quality of earnings.
Subsidiary Operations
During the year the Company
commissioned a state of the art plant in Poland to cater to the requirement of
its customers in Europe for Plastic Tubes, This was part of the Company's
strategy to source its requirement of Plastic Tubes from a cost efficient
manufacturing base. Following the transition of manufacturing to the new Poland
plant, the Company has permanently closed down its facility at Stevenage, UK.
The Company also stepped up new customer development activity in USA.
A new plant was set up in Uttarakhand, India, in order to support the growth
plan in Specialty Packaging business, which was acquired in 2006.
In the business of Medical Devices, the Company's state of art facility to
handle high volume manufacturing was started in Singapore. In March '08, the
Company expanded its foot print in USA with the acquisition of Catheter and
Disposables Technology, Inc. in Minneapolis, USA.
The Company presents Consolidated Financial Statements (CFS) encompassing all
its Subsidiaries based on uniform accounting policies. In this regard, for
purpose of alignment with the method followed in CFS, depreciation in respect
of one of the subsidiaries has been recomputed resulting in a lower
depreciation charge of Rs. 144. 594 millions (including Rs.16.018 millions for
this year) on consolidation.
As per Section 212 of the Companies Act, 1956, the Company is required to
attach the Directors' Report, Balance Sheet and Profit and Loss Account of its
subsidiaries. The Company had applied to the Government of India for and
obtained exemption from such attachment, since the audited consolidated
financial statements are presented in the Annual Report. Accordingly, the
Annual Report does not contain the financial statements of these subsidiaries.
The Company will make available the Audited Annual Accounts and related
information of the subsidiary companies, where applicable, upon request by any
Member of the Company. These documents will also be available for inspection by
any Member during business hours at the Company's Registered and Corporate
Office.
Ras Propack Lamipack Limited (RPL) and
Ras Extrusion Limited (REL)
During the year, the
Company has consented to participate in the rehabilitation and revival of RPL
and REL, both declared as "Sick industrial companies" under the Sick
Industrial Companies (Special Provisions) Act, 1985 (SICA). The Company has
agreed in principle to act as a Co-promoter in connection with the application
for approval of the scheme for revival and rehabilitation being submitted by
RPL and REL before the office of the Board of Industrial and Financial
Reconstruction (BIFR), New Delhi.
Management
Discussion and Analysis
FINANCIAL AND OPERATIONAL PERFORMANCE
Overview
The Company faced an
extremely challenging environment during the year 2007 on account of the
relentless increase in the raw material prices and heightened supply chain
demands posed by customers in the developed markets. Whilst strategically
addressing these key challenges, the Company's immediate priority was to
sustain the healthy growth momentum of the last few years. Consequently, the
consolidated sales revenue grew by 18%
Raw material cost was under pressure with polymer prices increasing by about
20% over the previous year (a large part of this materialized in the middle of
the year) spurred by 12% rise in the price of crude oil and supply constraints
in Ethylene, a key feed stock, due to strong global demand. The continuous
replenishment system implemented by their customers in respect of big retailers
in the developed markets further impacted the cost of servicing on account of
more change overs and higher inventories held to sustain service levels.
One-off production trial/stabilization costs incurred at the new Green-field
plants in the US and Poland also added to material costs. Much of these costs
could only be passed on to the customers with a lag. Consequently the gross
margin of the business was lower by 4.5 pp. Several pro-active efficiency
measures were initiated by the Company such as, negotiating better raw material
prices through centralized buying, developing cost-effective laminate
structures using its R and D capability etc. in order to counter the raw
material cost increases.
Operating costs continued to be a focus area and the Company continued to
benchmark productivity across its global operations in order to reduce
expenses. However, higher power cost, certain one-off costs attributable to
transitioning plastic tubes manufacture in Europe from UK to Poland and interim
measures taken to improve customer response capability in the US, impacted
operating costs. EBITDA for the year was hence lower at Rs. 2113 Million as
compared to Rs.2401 Million in the year 2006.
Firming up of global interest rates during the year by 100150 bps coupled with
increased borrowings to fund the Green-field units and the recent acquisition
of Medical devices and Specialty packaging businesses, contributed to the
increase in interest cost. Consequently, the profit before tax for the year
(before exceptional item) is lower than last year by 28.6% and the Profit after
tax and minority interest is lower at Rs.608 million as compared to Rs. 985
million in the last year.
Tube Business
The business in all the four regions grew strongly. Highlights of the
performance by region are as under:
Americas:
New customer
development efforts continued in the US market leading to further expansion of
business with the induction of some of the best known brands for the laminate
tubes. State-of-the-art tubing and high end decoration printing facility have
been set up which have opened new vistas of cosmetics and pharma markets for
the Company.
In regard to the plastic tubes, the various product trials and plant
certification work with potential key customers took longer than anticipated but
have been now successfully concluded. Operator training is complete, and the
new Plastic tube plant is poised to reach up to its installed capacity during
2008.
The Mexican operations turned around during the year helped by high capacity
utilization.
The relocation to Colombia of the Venezuelan capacity was completed and the
Colombian operations have performed well. The Venezuelan subsidiary is now
under liquidation.
Europe:
The laminate tube business in Europe grew in excess of 20%. Both Germany
and the UK operations registered sharp increase in sales. The UK operations are
now on turn around path, helped by higher capacity utilization and improved
efficiencies.
The Arista plastic tube business grew by 18%. The new world-class Polish unit went
on stream during the last quarter and the transition of manufacturing
operations from UK to Poland got completed by end of January 2008.The
transition was accomplished maintaining good industrial relations and morale,
the new Polish unit will provide greater flexibility for growth.
AMESA (Africa, Middle East and South
Asia)
The laminate tubes
business in Egypt and India continued to grow in double digits and perform
well.
The plastic tube business in India grew strongly by 40% supported by product
innovations such as oval tubes and silk screen printing.
The Company has also invested in the caps and closures business in India and
will begin to tap export potential during 2008.
EAP: (East Asia Pacific)
The laminate tube
business in China grew despite the lapse of one long-term contract; this was
achieved through expanding customer base and delivering high levels of customer
service.
Forays are being made into the foods packaging segment and into the markets of
North East Asia.
Speciality Packaging
The newly acquired
Specialty packaging business of Packaging India Private Limited grew strongly
by 20%. The facility in Puducherry has been further upgraded to improve the
product capability and offerings. New capacity has been established in Uttarakhand
to service the North based customers and to seize growth opportunity in the
rapidly growing foods segment in India. The Company is also investing in a
captive plant at Cuddalore for the manufacture of cylinders used in printing,
and this is expected to improve customer service and attract new
customers.
Medical Devices Business
Acquired in 2006,
this business performed to expectation in both Sales and Profits. The business
continues to pursue the twin strategy of diversification of customer base and
expansion of catheter into peripheral (non cardiac) applications. The new
manufacturing facility in Singapore went on stream helping improve the cost
structure and providing platform for further growth in the coming years. As
part of growth strategy, a Minneapolis based Company viz. Catheter and
Disposables Technology Inc. has been acquired in March 2008.
Finance
The Company's
borrowings increased sharply to meet the substantial capital expenditure and
acquisition projects, the debt equity ratio has therefore increased to 0.86:1.
Given the stability of operational cash flows, this is considered quite
reasonable and conducive to improvement of shareholder value. The Company has
secured necessary approvals to make an issue of Foreign Currency Convertible
Bonds at opportune time to augment funds for its growth plans.
a) Raw material price
escalation & the lag effect in passing these on to customers:
The Arming up of
crude oil prices and constraints in ethylene capacity could continue for some
more time causing upward pressure on raw material prices.
The Company is
continuously fine-tuning its buying strategy as well as pricing terms to
customers in order to secure better purchase prices and minimise lag in passing
on raw material price increases to customers.
b) Attracting and retaining Talent in
the context of business growth plans:
The high demand for
talent globally impacts people turnaround.
The Company is
addressing this to the best possible extent by a mix of active career planning,
competitive remuneration policy and empowerment culture.
c) Currency volatility:
The global scale of
operations exposes the Company to multiple currencies. Fluctuations in exchange
rates could effect Company's performance and future.
Appropriate coverage clauses have been woven into the contract with customers
to offset the impact of currency fluctuations. The Company also systematically
hedges its exposures through forward contracts.
d) Higher debt-equity ratio:
In a period of rising
interest rates, higher debt could impact the profit.
Ramping up of new capacities in Poland and USA will improve internal cash
generation. The Company also uses interest rate hedges to fix interest
cost.
Outlook
The Company's products enter the day to day needs of the people the world
over. Therefore they believe, based on their experience so far, that demand for
their products should not be impacted in any significant manner by volatility
in global financial market. On the contrary, the emerging markets will continue
to provide growth opportunity with increasing penetration of FMCG.
The continued
increase in raw material costs fuelled by commodity price increase and the
delay in the new feedstock capacities originally expected by mid 2008, are challenges
the Company is seized with. The Company is already focusing on the productivity
of capital and operational efficiencies in order to reverse the impact of slow
ramping up of its US and Poland facilities. In 2007 the Company had invested in
new big diameter laminate tube technology and high decoration capability which
added to costs. The early ramping up of its new facility in Poland and US will
be another area of focus, Viable new market opportunities will be seized,
specially in the emerging market, as a means to drive growth, The Company is
working to develop new and innovative products in line with the emerging
requirements of both developed and emerging markets. The new businesses in the
medical devices and specialty packaging will seek to grow in line with the
opportunities seen in their respective markets of US and India. The Company
believes that its focus, global scale, strong technology, Innovation base,
global customer network and the improved management band-width will be major
strengths in weathering the challenges it has encountered for some time and
delivering long-term value to shareholders.
Cautionary Statement
Statements in this
report, particularly those which relate to Management Discussion and Analysis,
describing the Company's objectives, projections, estimates and expectations
may constitute "forward looking statements" within the meaning of
applicable laws and regulations. Actual results might materially differ from
those either expressed or implied.
Subsidiary Operations
The Directors are of the opinion that since the Company is presenting
the Consolidated Financial Statements (CFS) of EP India and each of its
subsidiaries under AS—21 and also providing information as per Indian GAAP and
US GAAP, there is no need to attach the individual Balance Sheets and Profit
and Loss Accounts of each of the subsidiary companies. The Company therefore
applied to the Department of Company Affairs (DCA) for exempting the Company
from attaching the Balance Sheets, Profit and Loss Accounts, Directors' Report
and Auditors' Report of all its Subsidiary Companies.
DCA has vide its letter dated March 10, 2006, approved the Company's
request and exempted the Company from attaching the Profit and Loss Account,
Balance Sheet, Directors' Report and Auditors' Reports of all its subsidiaries
subject to the condition that the Company will attach the CFS of its
subsidiaries together with the Report of the Auditors' for the year ended
December 31, 2005. The Audited CFS of the Company as per Accounting Standard-21
form part of this Report.
Annual accounts of Subsidiary Companies have been kept open for
inspection by any investor at the Company's Registered and Corporate Office.
Bericap India Private Limited
This subsidiary, a Joint Venture with Bericap Holding GmbH, Germany, was
formed in the year 2000, for the manufacture of speciality closures in India,
changed its name from Beri – Essel Closures Private Limited to Bericap India
Private Limited, with effect from May 18, 2005. Since the Company does not see
a strategic value fit with its own global plans, it has decided to exit from
the Joint Venture over the next few years.
New Business Opportunities
The Company is exploring different business opportunities which could be
conveniently combined with the current business, for delivering consistent
growth in Revenue and Profits.
In this regard, the Company is considering entering into a new line of
business. They are pleased to place on record that the Members through the
process of Postal Ballot have approved with overwhelming majority, the
alteration of the 'Object Clause' of the Memorandum of Association of the
Company incorporating the related Objects pertaining to the new business along
with commencement of new business, at an opportune time, as the Board of
Directors may deem fit. Details of Postal Ballot results are given in the
Corporate Governance Report.
Awards and Laurels
The efforts made by the Technology and the Manufacturing groups have
resulted in many a laurels to the Company. The Company's plant at Silvassa has
been awarded a Certificate of Merit in the Manufacturing Category of the IMC
Ramkrishna Bajaj National Quality Award - 2005.
Fixed ASSETS:-
· Leasehold Land,
· Freehold Land,
· Buildings,
· Plant and Machinery,
· Equipments,
· Furniture and Fixtures,
· Software,
· Vehicles And
· Tubewell And
· Water Tank.
· Leasehold Improvement
Other details :-
The Company has consented to participate in the rehabilitation and revival scheme of RAS Propack Limited (RPL) and RAS Extrusion Limited (REL), both declared as "Sick industrial companies"under the Sick Industrial Companies (special provisions) Act, 1985 (SICA).The Company has also agreed in principle to act as a Co-promoter in connection with the application for approval of the scheme for revival and rehabilitation submitted by RPL and REL. The decision on the application is awaited before the office of the Board of Industrial and Financial Reconstruction (BIFR), New Delhi.
Website DETAILS:
Corporate
Profile
Subject is the
largest speciality packaging company in the world
manufacturing laminated and seamless tubes catering to the oral care,
cosmetics, personal care, pharmaceutical, food and industrial sectors. The
clients include top multinational companies as well as local and regional companies
in the countries that it operates. In March 2006, the company forayed into
Medical Devices business by acquiring two medical devices companies – one in
USA and another in Singapore. In August 2006, Subject entered speciality packaging materials by acquiring a company based
in the south of India. Subject’s headquarters is
based at Mumbai, India, and is a part of Essel Group. Essel Group has a wide
range of global business interests encompassing speciality
packaging, media programming, broadcasting and distribution, entertainment,
telecom and trading, having close synergies particularly with ventures active
in the areas of content, distribution / reach and infrastructure / logistics.
Subject
has state-of-the-art manufacturing facilities in 12 countries through 23
plants, such as China, USA, UK, Russia, Germany, Mexico, Colombia, Venezuela,
Philippines, Indonesia, Egypt, Nepal and Singapore besides India. The Company
is ranked no. 1 in the manufacture of laminated tubes in the world and has an
estimated 32% global market share. The company’s
stock is listed on the National Stock Exchange of India and the Bombay Stock
Exchange in India.
Corporate
Milestones in Brief :
Subject was the first company to introduce laminated tubes in India. The company started in 1984 with an integrated facility to manufacture Laminated tubes and laminates in India.
In 1993, Essel ventured out to become a global player by setting its first overseas venture in Egypt. In 1997, the Company formed a wholly owned subsidiary in Guangzhou, China. In 1999, Subject set up a Joint Venture in Dresden Germany. The Company also set up a wholly owned subsidiary in Nepal in the year 2000.
In December 2000, the Company acquired the tubing operations of the Propack group. Propack was the fourth largest laminated tube manufacturer in the World with operations in China, Philippines, Columbia, Venezuela, Indonesia and Mexico. This acquisition made Subject the world’s largest manufacturer of laminated tubes. In 2003, the Company set up a manufacturing plant at Danville, USA, to supply laminated tubes for Proctor and Gamble’s North American operations. In August 2004, the Company acquired Arista Tubes, UK, the leading manufacturer of seamless plastic tubes in UK (www.arista-tubes.com). In March 2005, Essel Propack’s plant in Russia, near Moscow, began its commercial operations. In its quest for further growth, in April 2005, Subject acquired another laminated tube manufacturing company named Telcon Packaging Limited in UK, which is now known as Essel Propack UK Limited.
In July 2005, Subject commissioned one more plant at Nalagarh, India, for manufacturing laminated tubes. In March 2006, the company forayed into Medical Devices business by acquiring Tacpro Inc., USA, and Avalon Medical Services, Singapore (www.tactxmed.com). These companies are leading manufactures of medical devices such as catheters and balloons. In August 2006, the company announced its plans to set up a co-extruded plastic tubes plant in mid West Poland. This plant also will be under the banner of Arista Tubes, UK.
This plant will be operational in March 2007. In August 2006, Subject acquired Packaging India, based in the southern part of India. Packaging India is one of the largest manufacturers of speciality packaging materials in India. In December 2006, the co-extruded plastic tubes plant in Danville, Virginia, USA, under the banner of Arista Tubes began commercial production.
The Company, today, has a presence in 12 countries with 23 manufacturing locations, has employee strength of over 1,900 comprising over 20 nationalities and has a capacity of manufacturing over 4.5 billion tubes per annum. Today the Company has an estimated 32% share in total laminated tube business. Essel Propack’s global operations have achieved a turnover of USD 270 million for the year 2006.
Quality Policy :
I. Statement of
Policy
Every member of the Subject family is passionate about and committed to:
Meet and exceed all their Customers’ requirements and delight customers with respect to Total Quality, On-Time Delivery, Service Reliability and Cost Competitiveness
Comply with all laws and regulations relating to Quality, Safety and Performance requirements in all countries in which EP products are sold
Strictly adhere to EP’s Harmonised Manufacturing Policy (HMP) and Good Manufacturing Practices (GMP) to achieve continual improvements in products, processes and services
Constantly benchmark with the Best Practices of Industrial Leaders to continually improve EP performance in Business and Manufacturing excellence
This will be achieved through documented and reviewed quality objectives, Process improvement activities, commitment to performance and unyielding integrity.
II. Responsibility
and Authority
The Vice Chairman and Managing Director of Subject has the ultimate responsibility and authority for the application of this policy
Each employee of EP is empowered to be responsible for compliance to this policy
Corporate Values are
:
· Customer Driven
· Commitment to Excellence
· Integrity
· Teamwork and Involvement
· Mutual Trust and Respect
· Safety
Technology is their benchmark of progress. It not only landmarks achievement by its sheer presence but is also responsible for Essel’s rise up the corporate ladder. All of Essel’s plants are highly automated with the best technological machinery and systems available anywhere in the world. For a better idea, click and enter their world of Integrated Manufacturing Process.
What really drives their technological pursuit? Product and process
developments, which top their list of priorities. For this alone, the company
has put in place, two teams at its Technological Innovation Centre.
While one team focusses on new products, the second works on process
management.
Primarily involved in developing new and improved products for customers, the
first team works in close co-ordination with customers to enhance the product
by experimenting with the various specifications associated with it.
The second team works more with the existing product range; with the mandate to
increase the machine operational efficiencies, by increasing the uptime and
reducing material wastage. This team monitors machine efficiencies in all the
manufacturing units and provides suitable recommendations. Together, the teams
combine efforts with the marketing arm of the organisation.
Further, Essel upgrades its testing facilities consistently to maintain its
position at the frontier of technology. The result : better products for its
customers.
Because there always is scope for improvement
Media Release
Subject acquires
Catheter and Disposables Technolog Essel Technology Inc. in USA
Mumbai, March 31, 2008 – Essel Propack Limited (EPL) today announced an acquisition of Minneapolis based company “Catheter and Disposables Technology” (CDT), a supplier of specialized disposable Medical Devices. EPL has acquired 100% equity of CDT in an all cash deal through its US
Subsidiary - Tacpro Inc.
CDT is a total solution provider from the concept to finished packaged sterile products. CDT is a strong brand name that has been associated for over 20 years with the provision of high quality medical device manufacturing services and reliable, on-time delivery of manufactured products. CDT’s Design Engineering and Development Capabilities provide a significant differentiator in the market. CDT’s facility is ISO 13485 certified and includes a Class 7 (10,000) Clean Room. Commenting on the same, Mr. R. Chandrasekhar, President of Essel Propack said, “The acquisition of CDT is in line with our stated strategic plan for the Medical Device Business. CDT will certainly expand our current foot print into a new geography and broaden our existing product lines”.
The buyout of CDT will help EPL’s Medical Devices Business to establish and expand operations in the State of Minnesota, the second largest Medical Device manufacturing region in USA.
“The acquisition of CDT is the first of the few steps for us to broaden our Medical Device Business”, said Mr. Ashok Goel, Vice Chairman and Managing Director.
The acquisition will be funded entirely from the internal accruals of the Medical Device Business. The acquisition is expected to be effective from 1st April 2008.
EP is a specialized
packaging company promoted by Essel Group and has its head quarters in Mumbai.
EPL has 3 lines of business:
- Plastic and
Laminated tubes
- Medical device
and
- Speciality
Packaging
EPL is the world’s
largest manufacturer of laminated tubes and has stateof- art facilities in 14
countries. EPL’s medical device business is located in California, USA and
Singapore. The business primarily focuses in offering end to end solutions for
Catheter based products. EP stock is listed in Bombay Stock Exchange and
National Stock Exchange, Mumbai.
Essel Propack expanding into Speciality Packaging Materials Acquiring
Packaging India, Pondicherry
Mumbai, August 30,
2006 :
Essel Propack, world’s largest manufacturer of laminated tubes, with
manufacturing in 13 countries through 22 plants, is acquiring 100% stake in
Packaging India Private Limited (PIPL), Pondicherry.
Packaging India, a proven player in the manufacturing of speciality
packaging materials, is a part of FMCG major CavinKare Group, Chennai.
While announcing the acquisition in Mumbai, Ashok Goel, the Vice
Chairman and Managing Director of Essel Propack said, “This is a significant
step in their product diversification strategy. With the Pharma and Retail
market poised for tremendous growth, the demand for Speciality packaging
Materials is slated to rise high. This is the opportune time for them to step
in and leverage the opportunities.” Explaining the logic of the divestment, C.
K. Ranganathan, Chairman and Managing Director of CavinKare Group said, “This
was a concerted move towards unshackling growth at PIPL. Considering the
heritage of PIPL, the Company was at a point of inflection in terms of growth.
Hence, it was realized that PIPL has to align itself with another packaging
company to achieve its true growth potential. Now the company will aggressively
target growth in sectors such as Pharma, Food, Retail, Exports and others.”
Speaking of the acquisition R. Chandrasekhar, COO, Essel Propack said,
“Packaging India and Essel 2 Propack has great many synergies which make this a
perfect buy. The two organizations have many similarities, foremost being the
organizational ethics, culture, the approach to business, knowledge base,
market reputation and the burning desire to grow.”
PIPL was established in 1990 as a part of Chennai based CavinKare group.
Today, it is the third largest producer of speciality packaging
materials in India, offering innovative packaging solutions. PIPL enjoys a
leading market position in the southern part of the country with substantial
breadth, state-of-the-art technology, unmatched product development expertise,
and strong relationships with a highly diversified, blue chip customer base.
The present team at the Company, headed by T. D. Mohan, the Managing Director,
will continue to manage the operations of the Company, under the guidance of
Essel Propack.
The core synergies
between PIPL and Essel Propack can be broadly termed as:
v
High-end lamination technology for speciality materials Knowledge of
requirement of Barrier Properties
v
OEM business model
v
Highest standards of quality and manufacturing systems
v
Expanded product portfolio to enable better service to a common customer
profile
v
Leveraging medical relationship to service each other’s customers
v
Tapping the global customer base of Essel Propack to expand PIPL’s
customer base
Creativity and Innovation is poised to take the centre stage in the
field of Packaging. The market demands are poised towards new trends,
sophistication, and user-friendliness. These needs can only be met by superior
manufacturing environment, high profile features and finer processes. Essel
Propack and PIPL are focused on creating such a discipline in the manufacture
of Speciality Packaging Materials.
They express their sincere thanks to the legal advisors ANS Law
associates, advisors to the deal Bellwether Capital and Deloitte Haskins and
Sells who did the financial due diligence.
Essel Propack, the largest speciality
packaging company in the world, is promoted by Essel Group. Essel Propack, head
quartered in India, manufacturers laminated and plastic tubes. The Company
provides packaging solutions to toothpaste, pharmaceuticals, cosmetics, food
and Industrial sectors all over the world. Recently, the Company forayed into
Medical Devices business. The Company has state-of-the-art manufacturing
facilities in 14 countries with 24 plants across the globe.
Essel Propack’s stock is listed on the Bombay
Stock Exchange and the National Stock Exchange.
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 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.43.38 |
|
UK Pound |
1 |
Rs.81.34 |
|
Euro |
1 |
Rs.64.55 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
6 |
|
OPERATING SCALE |
1~10 |
6 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
5 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
8 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
64 |
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/normal. |
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 |
|