MIRA
INFORM REPORT
|
Report Date : |
02.12.2008 |
IDENTIFICATION
DETAILS
|
Name : |
ADANI ENTERPRISES
LIMITED |
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|
|
Formerly Known
as : |
ADANI EXPORTS
LIMITED |
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Registered
Office : |
Adani House,
Shrimali Society, Mithakhali Six Road, Navrangpura, Ahmedabad – 380 009,
Gujarat |
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Country : |
India |
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Financials (as on) : |
31.03.2008 |
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Date of
Incorporation : |
02.03.1993 |
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Com. Reg. No.: |
04-19067 |
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CIN No.: [Company
Identification No.] |
L51100GJ1993PLC019067 |
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TAN No.: [Tax
Deduction and Collection Account No.] |
AHMA01099A |
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PAN No.: [Permanent
Account No.] |
AABCA2804L |
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Legal Form : |
A Public Limited Liability Company.
The company’s shares are listed on the Stock Exchanges |
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Line of
Business : |
Exporters of
Frozen Foods, Dyes and Intermediates, Plastic Products, Agricultural
Products, Precious Items, Tea, Coffee, Castor Oil and Seed, Textile Products,
Marine Items and other Agro Products.
|
RATING and
COMMENTS
|
MIRA’s Rating : |
Aa |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
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Maximum Credit
Limit : |
USD 67000000 |
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Status : |
Excellent |
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Payment
Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is
controlled and financed by Adani family. The company is a Government
Recognized Star Trading House having fine track of performance and financial status.
Available information indicates high financial responsibility of the company.
Payments are as per commitments. The company can be
considered normal for business dealings at usual trade terms and conditions. |
LOCATIONS
|
Registered Office
: |
Adani House,
Shrimali Society, Mithakhali Six Road, Navrangpura, Ahmedabad – 380 009,
Gujarat, India |
|
Tel. No.: |
91-79-25555555/26565555/25555080 |
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Fax No.: |
91-79-26565500 /
25555500 |
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E-Mail : |
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Website : |
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Head Office : |
Ahmedabad Gurgaon Mundra |
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Correspondence
Office: |
M/s. Pinnacle Share Registry Private Limited.,
Unit : (Adani Enterprises Limited), Near Asoka Mills Limited., Naroda Road,
Ahmedabad - 380 025. |
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Tel. No.: |
91-79-22200582, 22200338. |
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Fax No.: |
91-79-22202963. |
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E-Mail : |
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Branches : |
Located at :
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Domestic
Offices : |
Located At :
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International
Offices : |
Adani Global Limited. Adani Virginia Inc. Adani Global Pte Limited. Adani Shipping Pte Limited. Adani Global FZE BayBridge Enterprises LLC PT Adani
Global Graha Mustika
Ratu Lantai 5, JI. Jendral Gatot
Subroto Kav 74-75, Jakarta Selatan, Idonesia-Kode Pos – 12870 Others Located At :
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DIRECTORS
|
Name : |
Mr. Gautam S.
Adani |
|
Designation : |
Chairman |
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Date of Birth/Age : |
24.06.1962 / 46 years |
|
Qualification: |
S.Y. B.Com. |
|
Date of
Joining: |
02.03.1993 |
|
Previous
Employment: |
Business |
|
Expertise in specific : |
A man of tremendous
foresight, the dynamic and enterprising Shri Gautam S Adani has
over 25 years of varied experience in manufacturing and trading. He joined
the family business of trading in textiles in the early eighties while
completing his education. Ever since there has been no looking back for the
46 year old visionary. His unparalleled expertise in international trade,
solution oriented approaches, innovation and endurance in an increasingly
competitive and rapidly expanding trading market has seen the Adani Group
metamorphose itself from a trading house to an infrastructure builder and
basic utility provider. |
|
Directorships held in other Public
Companies (Other than Adani Enterprises Limited .) : |
Mundra Port
and Special Economic Zone
Limited . ·
Adani Power Limited . ·
Adani Energy Limited . ·
Adani Wilmar Limited . ·
Adani Logistics Limited . ·
Adani Welspun ·
Exploration Limited . ·
Dholera Port And Special ·
Economic Zone Limited . ·
Adani Power Maharashtra Limited . ·
Adani Power Rajasthan Limited . ·
Adani Power Dahej Limited . |
|
Memberships/ Chairmanships
of Committees
across Public
Companies : |
Audit
Committee: ·
Adani Logistics Limited . ·
Adani Energy Limited . ·
Adani Wilmar Limited . |
|
|
|
|
Name : |
Mr. Rajesh S.
Adani |
|
Designation : |
Managing Director |
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Age: : |
43 years |
|
Qualification: |
B. Com. |
|
Date of
Joining: |
1st December, 1993 |
|
Previous
Employment: |
Business |
|
|
|
|
Name : |
Mr. Vasant S.
Adani |
|
Designation : |
Wholetime Director |
|
Age: |
50 years |
|
Qualification: |
B.A. |
|
Date of
Joining: |
1st July, 1995 |
|
Previous
Employment: |
Business |
|
|
|
|
Name : |
Mr. Pradeep Mittal
|
|
Designation : |
Wholetime Director |
|
Age: |
53 years |
|
Qualification: |
Diploma in Marketing |
|
Date of
Joining: |
1st January, 1998 |
|
Previous
Employment: |
Karamchand Thapar and Brothers [C.S.] Limited – Chief General Manager |
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|
|
|
Name : |
Mr. Jay H. Shah |
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Designation : |
Director |
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Expertise in specific : |
The 50 year old law graduate, Shri Jay H Shah, has been with the
company since its inception. Acknowledged by one and all in the company to
possess the acumen of an artful trader, his connections and global sourcing
skills have earned him a reputation in the chemical sand petro - chemicals
business. |
|
Memberships/ Chairmanships of Committees across Public Companies : |
Audit Committee: Adani
Enterprises Limited . Shareholder's/Investors Grievances Committee: Adani
Enterprises Limited . Remuneration committees Adani
Enterprises Limited . |
|
Name : |
Dr. Pravin P. Shah |
|
Designation : |
Director |
|
Expertise in specific : |
Aged 64 years, Dr. Pravin P. Shah is a Practising Chartered Accountant
and the proprietor of the renowned firm M/s. Pravin P. Shah and Associates, a
firm of Chartered Accountants. He has over 38 years of experiences in areas
of financial consultancy, taxation, valuation, property matters, accounting,
auditing, corporate laws and FEMA. He has also authored books on Costing,
Management Strategies and Taxation. His latest published book is “Billion
Dollar Companies”. He has also contributed technical papers on taxation,
valuation, financial management , Company Law, Acquisitions and Mergers,
Stamp duty and Others at various conferences and published in professional
journals, business magazines and financial newspapers in India and U.S.A. |
|
Directorships held in other Public
Companies (Other than Adani Enterprises Limited .) : |
·
Bhansali Engineering Polymers Limited . ·
Bombay Rayon Fashions Limited . ·
Claris Lifesciences Limited . ·
JM Financial Limited . ·
Jai Corp Limited . |
|
Memberships/Chairmanships
of Committees across Public
Companies : |
Audit Committee: ·
Bombay Rayon Fashions Limited . ·
Bhansali Engineering Polymers Limited . ·
Claris Lifesciences Limited . ·
JM Financial Limited . Remuneration Committee ·
Adani Enterprises Limited . ·
Bombay Rayon Fashions Limited . ·
Claris Lifesciences Limited . ·
JM Financial Limited . |
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|
|
|
Name : |
Mr. C. R. Shah
(Upto 23.04.2008) |
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Designation : |
Director |
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|
|
|
Name : |
Dr. A. C. Shah |
|
Designation : |
Director |
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|
|
|
Name : |
Mr. Yoshihiro Miwa
|
|
Designation : |
Director |
KEY EXECUTIVES
|
Name : |
Mrs. Birva C.
Patel |
|
Designation : |
Company Secretary
[w.e.f. 10.07.2003] |
|
|
|
|
Name : |
Mr. Hemendra C
Shah |
|
Designation : |
Company Secretary |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
AS ON 31.03.2008
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
|
Indian Promoters |
184855231 |
75.00 |
|
Foreign Institutional Investors |
34326342 |
13.93 |
|
Mutual Funds, Banks and Financial Institutions |
3958322 |
1.60 |
|
NRI/OCB / Foreign National |
5988680 |
2.43 |
|
Private Bodies Corporate |
3488073 |
1.42 |
|
Public |
13591571 |
5.51 |
|
Any others (Shares in transit) |
278756 |
0.11 |
|
Total
|
246486975 |
100.00 |
BUSINESS DETAILS
|
Line of
Business : |
Exporters of
Frozen Foods, Dyes and Intermediates, Plastic Products, Agricultural
Products, Precious Items, Tea, Coffee, Castor Oil and Seed, Textile Products,
Marine Items and other Agro Products.
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Products : |
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PRODUCTION STATUS (As on 31.03.2007):-
|
Particulars |
Unit |
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|
Actual
Production |
|
|
|
|
|
|
|
Agro Products |
MT |
|
|
215,254.468 |
|
Precious's Other Metal |
KGS |
|
|
7,824.670 |
|
Minerals /Oils |
CBM |
|
|
459.419 |
|
Textile Products |
KGS |
|
|
18,973.000 |
|
Textile Products |
PCs |
|
|
35,570.000 |
|
Textile Products |
MTR |
|
|
17,342.500 |
GENERAL
INFORMATION
|
No. of
Employees : |
About 1000 |
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Bankers : |
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Facilities : |
NOTES :- Above facilities are secured by : a) Hypothecation of the stocks and book
debts by way of first charge ranking pari-passu among the Banks. b) Hypothecation of furniture and fixtures at
Corporate House Gurgaon. c) Tangible movable properties ranking
pari-passu among the Banks. d) Guarantee given by some of the Directors
in their personal capacity. e) Pledge of 10000000 equity shares of Mundra
Port and SEZ Limited held by an associate Company. Further secured by creation of Equitable
Mortgage : a) Over certain immovable properties of the
Company. b) Over certain immovable properties of the
associate Company. The above debentures are secured by a) Hypothecation on movable properties of
the Company situated at Belekeri Port (Karnataka). b) Equitable Mortgage over an immovable
property of the Company. c) Pledge of shares of some of the
promoters and their relatives d) Non Convertible Debentures of Rs. 500
millions shall be redeemed in three equal installments at the end of third,
fourth and fifth year from the date of allotment i.e. 26th August, 2005. Vehicles loans are secured by hypothecation
of assigned vehicles. Home loans are secured by hypothecation of
assigned properties.
NOTES :- Bonds during the conversion period from
January 27, 2008 to 27 December 2011.Unless previously converted, redeemed or
purchased and cancelled, the Bonds will be redeemed at maturity date, without
further notice, on 27th January, 2012. are convertible into equity shares at
the option of bondholders, any time The and prior to 27th January, 2012, the
bonds into equity shares as per the agreed terms of the FCCB issue. Company also has an option to convert at
any time, on or after 27th July,2008 Loans and/or Pledge of shares of some of
the Promoters and their relatives and/or guaranteed by some of the Directors
in their personal capacity from Banks / Financial Institutions are secured by
Demand Promissory Note |
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Banking Relations : |
Good |
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Auditors : |
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Name : |
Dharmesh Parikh
and Company Chartered
Accountants |
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Address : |
Ahmedabad, Gujarat |
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Subsidiaries : |
Business: Real Estate -
Adani Infrastructure and Developers Private Limited -
Adani Estates Private Limited -
Swayam Realtors and Traders Limited -
Columbia Chrome (India) Private Limited -
Adani Townships and Real Estate Company Private Limited -
Adani Land Developers Private Limited -
Adani Realty Private Limited -
Adani Habitats Private Limited Business: Agro -
Adani Agri Logistics Limited Business: Power -
Adani Power Limited -
PTAdani Global, Indonesia. Business: Metals and Minerals -
VyomTradelinksPrivate Limited -
Adani Virginia Inc, USA Ship Owning and Chartering in Singapore. -
Adani Shipping Pte. Limited, Singapore -
Libra Shipping Pte Limited, Singapore ·
Adani Agri Fresh Limited ·
Adani Developers Private Limited ·
M/s. Adani Exports ·
Adani Estate Private Limited ·
Adani Global Limited ·
Adani Global FZE ·
Adani Global Pte. Limited |
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Associates : |
·
Adani Agro Private Limited ·
Adani Energy Limited ·
Aditya Corpex Private Limited ·
Adani Logistics Limited ·
Adani Port Infrastructure Private Limited ·
Adani Retail Limited ·
Advantage Retail Private Limited ·
B2B India Private Limited ·
Gujarat State Exports Corporation Limited ·
M/s. Intercontinental (India) ·
Komal Marketing Private Limited ·
Komal Infotech Private Limited ·
Mundra Poitand Special Economic Zone Limited ·
Mundra Special Economic Zone Limited |
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Joint Venture :
|
Adani Wilmar Limited |
CAPITAL STRUCTURE
(As on 31.03.2008):-
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
500000000 |
Equity Shares |
Rs.1/- each |
Rs. 500.000 millions |
|
50000000 |
Preference Shares |
Rs.10/- each |
Rs. 500.000 millions |
|
|
|
|
Rs.1000.000 millions |
Issued, Subscribed and Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
246486975 |
Equity Shares |
Rs.1/- each |
Rs. 246.500
millions |
Notes:-
Of the above Equity Shares
26012975 (Previous Year 26012975) Equity
shares of Re. 1/- each were allotted as fully paid up at premium on conversion
of foreign currency convertible bonds.
5000000 (Previous Year 5000000) Equity
Shares of Re. 1/- each were allotted as fully paid up at premium without
payment being received in cash, on amalgamation
5000000 (Previous Year 5000000) Equity
Shares of Re. 1/- each were issued as Bonus Shares by capitalisation of profit.
165355000 (Previous Year 165355000) Equity
Shares of Re. 1/- each were issued as Bonus shares by capitalisation of share
premium.
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 |
246.500 |
246.500 |
226.200 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves and Surplus |
13130.100 |
10195.300 |
7478.100 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
13376.600 |
10441.800 |
7704.300 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
2173.800 |
8870.900 |
8722.200 |
|
|
2] Unsecured Loans |
28451.400 |
21374.600 |
4475.000 |
|
TOTAL BORROWING
|
30625.200 |
30245.500 |
13197.200 |
|
|
Deferred Tax Liability |
161.500 |
169.000 |
86.500 |
|
|
|
|
|
|
|
TOTAL
|
44163.300 |
40856.300 |
20988.000 |
|
|
|
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|
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|
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APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
2019.500 |
2047.200 |
672.300 |
|
|
Capital work-in-progress |
171.500 |
32.600 |
109.000 |
|
|
|
|
|
|
|
|
Deferred Tax Assets |
0.000 |
0.000 |
19.300 |
|
|
INVESTMENTS |
14947.700 |
6008.200 |
1929.300 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS and ADVANCES |
|
|
|
|
|
|
Inventories |
9148.900 |
3987.800 |
3883.500 |
|
|
Sundry Debtors |
12306.200 |
16535.800 |
22439.400 |
|
|
Cash and Bank Balances |
10895.800 |
13578.800 |
5888.600 |
|
|
Other Current Assets |
0.000 |
0.000 |
0.000 |
|
|
Loans and Advances |
17464.100 |
16186.800 |
5450.800 |
|
Total Current Assets |
49815.000 |
50289.200 |
37662.300 |
|
|
Less : |
|
|
|
|
|
|
Current Liabilities |
21153.300 |
16512.200 |
18651.300 |
|
|
Provisions
|
1637.100
|
1008.700
|
752.900 |
Total Current Liability
|
22790.400 |
17520.900 |
19404.200 |
|
|
Net Current Assets |
27024.600 |
32768.300 |
18258.100 |
|
|
|
|
|
|
|
|
Miscellaneous Expenditures |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
TOTAL
|
44163.300 |
40856.300 |
20988.000 |
|
PROFIT and LOSS
ACCOUNT
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
|
Sales Turnover |
115954.400 |
101516.600 |
93378.800 |
|
|
Other Income |
291.700 |
39.900 |
13.800 |
|
|
Total Income |
116246.100 |
101556.500 |
93392.600 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
3525.100 |
1983.100 |
1564.500 |
|
|
Provision for Taxation |
404.400 |
476.200 |
381.100 |
|
|
Profit/(Loss) After Tax |
3120.700 |
1506.900 |
1183.400 |
|
|
|
|
|
|
|
|
Earnings in Foreign Currency : |
|
|
|
|
|
|
Export of Goods
on F.O.B. Basis |
58579.800 |
35458.200 |
2,6045.700 |
|
|
Interest Income |
397.500 |
128.000 |
36.800 |
|
|
Dividend Income |
3.800 |
4.600 |
4.300 |
|
|
Other Income |
526.500 |
627.200 |
209.200 |
|
Total Earnings |
59507.600 |
36218.000 |
26296.000 |
|
|
|
|
|
|
|
|
Imports : |
|
|
|
|
|
|
Trade Goods |
45037.300 |
37131.300 |
37615.000 |
|
Total Imports |
45037.300 |
37131.300 |
37615.000 |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Cost of Goods Sold |
106324.800 |
94768.400 |
88156.000 |
|
|
Personnel Expenses |
534.900 |
337.200 |
225.800 |
|
|
Operation and Other Expenses |
4210.700 |
2955.500 |
2292.600 |
|
|
Financial Charges |
1543.800 |
1436.800 |
1121.600 |
|
|
Depreciation and Amortization |
106.800 |
75.500 |
32.100 |
|
Total Expenditure |
112721.000 |
99573.400 |
91828.100 |
|
QUARTERLY RESULTS
|
Particulars |
|
30.06.2008 |
30.09.2008 |
|
|
|
|
|
|
Type |
|
1st Quarter |
2nd Quarter |
|
|
|
|
|
|
Sales Turnover |
|
23948.000 |
31152.300 |
|
Other Income |
|
11.300 |
91.900 |
|
Total Income |
|
23959.300 |
31244.200 |
|
Total Expenditure |
|
22305.600 |
29636.600 |
|
Operating Profit |
|
1653.700 |
1607.600 |
|
Interest |
|
780.500 |
918.100 |
|
Gross Profit |
|
873.200 |
689.500 |
|
Depreciation |
|
28.900 |
29.800 |
|
Tax |
|
137.500 |
[10.000] |
|
Reported PAT |
|
669.700 |
668.000 |
KEY RATIOS
|
Year |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
Debt-Equity
Ratio |
2.56 |
2.39 |
1.49 |
|
Long Term
Debt-Equity Ratio |
2.41 |
2.16 |
1.24 |
|
Current
Ratio |
2.27 |
2.13 |
1.69 |
|
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|
|
|
TURNOVER RATIOS |
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|
|||
|
Fixed
Assets |
49.47 |
65.47 |
130.50 |
|
Inventory |
17.29 |
25.55 |
26.24 |
|
Debtors |
7.87 |
5.16 |
4.26 |
|
Interest
Cover Ratio |
1.73 |
1.52 |
1.36 |
|
Operating
Profit Margin(%) |
6.26 |
5.82 |
6.30 |
|
Profit Before
Interest And Tax Margin(%) |
6.16 |
5.75 |
6.27 |
|
Cash Profit
Margin(%) |
2.41 |
1.57 |
1.30 |
|
Adjusted
Net Profit Margin(%) |
2.31 |
1.50 |
1.27 |
|
Return On
Capital Employed(%) |
16.53 |
18.79 |
32.47 |
|
Return On
Net Worth(%) |
22.02 |
16.61 |
16.35 |
LOCAL AGENCY
FURTHER INFORMATION
History
Incorporated in 1988 as a
partnership firm on a small scale, subject formerly known as Adani
Exports(AEL)), now a super trading house mainly exports frozen seafood, precious
metals, plastic products, agro products, etc, to about 30 countries all over
the world. The company has been recognized as Five Star Export House by
Government of India.
Subject enters into contracts with various suppliers and manufacturers, to
export their produce under its name. It is entitled to advance licences for
export commitments fulfilled. It then sells these licences in the open market
and shares export incentives with supporting suppliers. The portion of the
export incentives retained by it constitutes its income. Under direct exports,
the company exports products like detergents and de-oiled cakes. Subject books
orders and develops suppliers for any merchandise.
Subject has signed a memorandum of understanding (MoU) with the Orissa
government to develop Gopalpur port into an all-weather world class port to
handle 6.5 million tonnes per annum (mtpa) of cargo at a cost of Rs 6500 Millions through a joint venture (JV) company.
The Company in association with Hyundai of Korea and Pro Majestic Sdn Bhd of
Malaysia is in the process of submitting final bid for 2 X 250 MW imported coal
based power plant to be located at Mundra. The Company also contemplates to
enter into energy sector by laying a distribution network for supply of natural
gas through pipeline to industrial, commercial and domestic sectors covering
all major consumption centres of the state. The Company has entered into an MOU
with the Gujarat State Petronet Limited and Petronet LNG Limited for the
utilization of main distribution trunk pipeline.
2001-02 Mundra Port has commissioned the 57 Km rail link between Adipur and
Mundra. The Company commenced a project for containerised cargo by forming a
new company viz Adani Container (Mundra) Terminals Limited The project had commenced
in phased manner from October, 2002 at a cost of Rs.2970 Millions.
Adani Global Limited, Mauritius is the subsidiary of the company and Adani
Global Pte Limited, Singapore and Adani Global FZE, Dubai is subsidiaries of
Adani Global Limited, Mauritius. Gujarat State Export Corporation Limited and
Adani Chemicals Limited ceased to be subsidiaries of the company with effect
from 26th March 2004. Adani Wilmar Limited ceased to be joint venture from 28th
June 2004. Adani Virginia Inc and Bay Bridge LLC are subsidiary companies of
Adani Global FZE.
During August 2004 the company has sub-divided its equity share face valuefrom
Rs.10/- per share to Re.1/- per share.
During 2005-2006, Adani Agri fresh Limited, Adani Virginia Inc and Bay Bridge
Enterprise LLC became subsidiary Companies of the company.
Biodata
Subject conceived as a partnership firm by Gautam S Adani in
the year 1988, was converted into a joint stock company in 1993 and made its
IPO in 1994. With its head office in Ahmedabad, India, subject has extended its
activities across the globe. The company has a diversified presence in five
business sectors: Power, Oil and Gas, Real Estate, Agro and Metals and Minerals
with Shipping, the shipping acting as backbone to its various businesses.
subject has over the years transformed itself into a diversified asset backed
commodities trader, sourcing, producing, marketing and transporting nearly 70
commodities across more than 60 countries. The company operates through 30
offices including eight overseas offices in USA, UAE, China, Singapore,
Indonesia, Mauritius and Myanmar.
The Ministry of Commerce, Government of India, accorded the status of 'Super
Star Trading House' on April 1, 1994, the youngest trading house and the only
one from the State of Gujarat to have been granted this status and in the year
1997, Super Star Trading House status extended for another 3 years, in spite
qualification limits for this status being substantially enhanced. During the
year 1998, subject becomes the top net foreign exchange (NFE) earner of the
country, Jetty at Mundra Port started its operation and the Coal business of
the company was commenced. Trading in Edible Oil business of the company was
commenced during the year 2000. The company received Gold Trophy, SRTEPC
1999-00 and 2000-01. In 2001 and 2003, the largest private sector player
awarded with prestigious award of 'Golden Super Star Trading House.' The
company awarded 'Five Star Export House' status and successfully disinvested
its stake in Mundra Container Terminal to P and O Ports, Singapore. The Company
was awarded the highest category 'F' inter-state license for trading in power
by the Central Electricity Regulatory Commission (CERC) in 2003. Subject
introduced new products like Iron Ore, Power Trading, Maize, Sesame Seeds,
Sorghum and Barley etc. subject bagged GCCI Export Appreciation Award
2003-04.
The company has received prestigious reorganization of 'Five
Star Export House' on account of valuable contribution in country's overall
exports in the year 2005 and also subject has lucratively completed foreign
currency convertible bond issue of USD 38 Million and proved its global reach.
subject awarded as 'Five Star Export House', 2005. Got ICSI award for
Excellence in Corporate Governance, 04 among the Top 25 Companies. Also the
subject got certification of ISO 9001:2000 in the year 2005, Accreditation by
AG Nielsen ORG Marg-Fortune, the Largest Selling Edible Oil brand in India with
22% market share on March '05.
During 2006, Adani Agrifresh commenced its business. Subject commissions two
floating crane barge. Work on setting up grain silos under Adani Agri Logistics
was started. Also the company commenced the construction of 660 MW thermal
power project at Mundra, subject expanded jetties at Mundra Port initiated. The
Company name was changed from Adani Exports Limited to 'Adani Enterprises
Limited' in August of the year 2006, the change in name conveys evolution with
a clear focus on its five SBUs viz. Power, Oil and Gas, Real Estate, Agro and Metals
and Minerals. Rajasthan Rajya Vidyut Utpadan Nigam Limited (RVUNL) selected the
company for carrying out coal mining operations for its power plan. The company
has successfully completed its foreign currency convertible bond issue in the
year 2007 worth of USD250 Million for its business expansion plans. Orders for
two Capesize vessels placed with a Korean Shipyard by the company.
The Base Depot constructed by Adani Agri Logistics got commissioned on 17th
July 2007. The company has entered into a long-term agreement with Gujarat Urja
Vikas Nigam Limited, to supply 2000 MW of electricity. Adani Agri Fresh
Limited, its wholly owned subsidiary, is the first company in India to has
successfully implemented Controlled Atmosphere Storage Facilities (CASF) for
the storage and trading of fruits and vegetables under controlled climatic
conditions.
As on April 2008, Adani Power Private Limited, a part of
Adani Enterprises, is lining up a 10,000-mw-expansion plan, which includes
setting up of new capacities at Dahej in Gujarat and at Kawai in the Baran
district of Rajasthan. The Company plans to expand its Edible Oil business into
the entire Indian sub-continent and is targeting to reach crushing capacities
upto 10,000 Tonnes Per Day and refining capacities upto 7,200 Tonnes Per Day.
Subject through its 100% subsidiary Adani Power Limited has initiated coal
based power plant development in three phases to reach overall capacity of 2640
MW by end of 2010 in a phased manner.
Subject is an international trading house dealing with a long list of contact
offices around the world to provide easy access to its clientele. To further
strengthen its presence in the business landscape, the company forays into new
strategic initiatives in various sections. The new businesses have garnered a
significant share of these emerging high-growth markets in India. Subject has
achieved the critical mass needed to carry out the sizable transactions
demanded by its global clients, while at the same time maintaining the
entrepreneurial drive that has given it an edge of the country as well as in
overseas.
Business
The company's
identified groups are as follows:
- Agro Group comprising wheat and rice,
castor oil, oilseed extraction, sugar and pulses.
- Energy Group comprising petro-chemicals,
oil and lubricants, coal and Coke, fertilizers and raw materials.
- Textiles Group comprising cotton,
fabrics, polyesters and yarns.
- Precious Goods Group comprising jems and
jewellery, diamond, gold and silver
- Strategic Investment Group that promoted
Mundra Port, Edible Oil Business, Food and Grocery retail outlets and the
call centre.
The company ranks
amongst the largest and the fastest growing business houses in India.
Performance
Standalone:
The Company posted another record performance in
fiscal 2008 and posted strong growth in all segments.
On a
standalone basis, the Company achieved a turnover of Rs. 116246.1 millions as
compared to Rs. 101556.5 millions in the previous year registering a growth of
14%. The net profit after tax stood at Rs. 3120.7 millions compared to Rs.
1506.9 millions in the previous year registering a growth of 107%. The EPS of
the Company as at 31st March, 2008 was Rs. 12.66/-.
Consolidated
:
The
consolidated turnover is Rs.196487.1 million as compared to Rs. 169532.2
millions in the previous year registering a growth of 16%. The consolidated net
profit after tax and minority interest is Rs. 3697.5 millions as compared to
Rs. 1732.8 millions in the previous year. The Consolidated Financial Statements
of the Company prepared as per Accounting Standards AS 21 and AS 23 prescribed
by the Institute of Chartered Accountants of India and Clause 32 of the Listing
Agreement have also been included and form part of this Annual Report. The consolidated
networth of the Company as at March 31, 2008 is Rs. 21177.1 millions as
compared to Rs. 11469.5 millions in the previous year registering a growth of
85%.
A detailed
discussion of the performance of operations of the Company is given under
“Management Discussion and Analysis Report”, which forms part of this report.
SEGMENT
REPORTING
The Company
is a “Five Star Export House” with
operations covering a wide range of commodity groups like Agro, Energy, Metals
and Minerals and others with shipping forming backbone to its businesses. In
view of the integrated nature of business in its entirety, there are no
separate segments within the Company as defined by Accounting Standard 17
(Segmental Reporting) issued by the ICAI.
Real Estate :
·
Adani Infrastructure and Developers Private.
Limited.
·
Adani Estates Private. Limited.
·
Swayam Realtors and Traders Limited.
·
Columbia Chrome (India) Private. Limited.
·
Shantigram Estate Management Private. Limited.
·
Adani Land Developers Private. Limited.
·
Adani Developers Private. Limited.
·
Adani Landscapes Private. Limited.
(Became subsidiary
w.e.f. 27 September, 2007)
·
Adani Mundra SEZ Infrastructure Private. Limited.
(Became subsidiary
w.e.f. 1 February, 2008)
·
Miraj Impex Private. Limited.
(Became subsidiary
w.e.f. 15 October, 2007)
Agro
:
·
Adani Agri Logistics Limited.
·
Adani Agri Fresh Limited.
Energy:
Power :
·
Adani Power Limited.
·
Adani Power Maharashtra Limited.
(Became subsidiary w.e.f. 23 July, 2007)
·
Adani Power Rajasthan Limited.
(Became subsidiary w.e.f. 10 March, 2008)
·
Adani Power Dahej Limited.
(Became subsidiary w.e.f. 15 December, 2007)
Coal :
·
Adani Global Pte. Limited., Singapore.
(Subsidiary of Adani
Global Limited., Mauritius)
·
PT Adani Global, Indonesia
(Subsidiary of Adani Global
Pte. Limited., Singapore)
·
Parsa Kente Collieries Limited.
(Became subsidiary
w.e.f. 16 October, 2007)
·
Adani Mining Private. Limited.
(Became subsidiary
w.e.f. 31 August, 2007)
Oil and Gas:
·
Adani Energy Limited.
(Became subsidiary
w.e.f. 21 June, 2007)
·
Adani Welspun
Exploration Limited.
(Became subsidiary
w.e.f. 4 August, 2007)
Metals, Minerals and Scrap:
·
Vyom Tradelinks Private. Limited.
·
Adani Global FZE, Dubai
(Subsidiary of Adani
Global Limited., Mauritius)
·
Adani Virginia Inc, USA
(Subsidiary of Adani
Global FZE, Dubai)
Ship Owning and Chartering
·
Adani Shipping Pte. Limited, Singapore.
(Subsidiary of Adani Global Limited., Mauritius)
·
Libra Shipping Pte Limited, Singapore.
(Subsidiary of Adani Global Limited., Mauritius)
Others - Holding Companies
·
Adani Habitats Private. Limited.
·
Adani Global Limited., Mauritius.
JOINT
VENTURES
Joint
Venture with RVUNL, Rajasthan.
The Company
has entered into a strategic tie up through a Joint Venture (JV) with Rajasthan
Rajya Vidyut Utpadan Nigam Limited. (RVUNL), an undertaking of Government of
Rajasthan and engaged in the business of generation and distribution of
electricity in the State of Rajasthan.
Pursuant to
Joint Venture Agreement, a new JV Company, namely “Parsa Kente Collieries
Limited.,” has been incorporated in the month of October 2007. The Company
holds 74% stake of Parsa Kente Collieries Limited. It will develop and operate
coal mines; coal blocks in Sargaja District (Chhatisgarh) for the exclusive use
of RVUNL and also for benefication, transportation and delivery of coal to
RVUNL for its generation stations.
Joint
Venture with Chemoil Group, Singapore.
The Company
has also tied up a joint venture with "Chemoil Group" of Singapore
and formed a 50:50 JV Company namely, Chemoil Adani Private Limited. on 27th
May, 2008 in India for undertaking businesses relating to bunkering i.e. ship
fuelling at the various ports of India.
MANAGEMENT
DISCUSSION AND ANALYSIS REPORT
The
Management of the Company present the analysis of performance of the Company
for the year 2007-2008 and the outlook for the future, which is based on
assessment of the current business environment. It may vary due to future
economic and other developments, both in India and abroad.
The Indian
economy in the last few years has been on an upswing and marches ahead as one
of the fastest growing economies in the world. Such a robust growth has been
spurred by the Industrial and Service Sectors which have contributed more than
80% of the total GDP. In turn, tax collections have been buoyant, improving
state of the public finances.
A GDP growth
of around 9% in consecutive years and robust domestic consumption portend
encouraging signs of continued growth. During the year, the capital market
overall did well despite some volatility. The rupee proved to be sturdy and
reliable currency with a surge in the inflow of foreign direct investments and
portfolio investments, as also weakness exhibited by the US Dollar. Foreign
exchange reserves burgeoned. Amidst the backdrop of global volatility and
incipient signs of a global slowdown, India's economy shows resilience,
characterized by healthy macro economic conditions. This along with other
positive factors such as favorable demographic profile and rising income levels
holds out promise for furthering the consumption led growth. Indeed, India
looks poised to maintain its growth trajectory as a country. The remarkable
progress of the industrial sector registering a growth of more than 10%
provides immense opportunities for the Company. The management's views on the
Company's performance and outlook are discussed below:
Business:
Energy
The Company
has a significant presence in the Energy sector commodities of coal, power, petroleum
products trading and city gas distribution. In order to be present across the
value chain in these business areas, the Company initiated its foray into power
generation, coal mining, oil and gas exploration as well as expanding the city
gas distribution footprint to several other cities in India.
Power
Generation
The Company
intends to capitalize on the emerging opportunities in the Indian power
generation sector, which are being driven by the current and expected demand
and supply imbalance in India. Notwithstanding various policy initiatives
within India to diversify fuel mix, with the limited reserve potentiality of
petroleum and natural gas, eco-conservation, restrictions on hydroelectric
power projects and the geopolitical perception of nuclear power, they believe
that it is likely that coal will continue to be the primary generator of energy
in India.
The Company
is targeting a total power generation capacity of 10,000 MW to be operational
in a phased manner through its subsidiaries, Adani Power Limited., Adani Power
Maharashtra Limited, Adani Power Rajasthan Limited., Adani Power Dahej Private.
Limited. in the states of Gujarat, Maharashtra and Rajasthan.
The Company
has currently six thermal power projects under various stages of development or
planning. Brief details of various power projects being undertaken by the
Company are as under:
4620
MW Thermal Coal based power project - Mundra SEZ area through a subsidiary
Company,
Adani Power Limited. (APL)
Mundra
power projects: The Mundra power projects are located along the
coast and will utilize imported coal as primary fuel for its operations. APL
has entered into long-term coal supply arrangements for importing coal with the
Company for Mundra power projects. PT Adani Global, subsidiary of the Company,
has entered into agreements with holders of long-term exploitation licenses to
exclusively mine coal in Bunyu Island, Indonesia. For Mundra I, II and III
power projects, APL proposes to procure the coal from PT Adani Global which
will source such coal from mines in Indonesia. The coal for Mundra IV power
project will also be procured internationally and supplied by the Company to
the power project sites. As a result of their long-term coal supply agreements
and relationship with the supplier, they believe that the Company will benefit
from competitive pricing for procuring the coal for its various power projects.
Phase
I and II of the Mundra power project will have four sub-critical generation
units of 330 MW each, with combined capacity of 1,320 MW. The Boiler, Turbine
and Generator (“BTG”) package for phase I and II of Mundra Power Project has
been awarded to Sichuan Machinery and Equipment Import and Export Company
Limited and Kowa Company Limited, respectively. They currently expect that the
first 330 MW unit of Mundra I and II power project will commence operations
from January 2009, and that the power project will be fully commissioned by
October 2009.
Phase
III and IV of the Mundra Power Project : Phase III and IV of the Mundra Power project
have two and three super-critical generation units of 660 MW each with combined
capacity of 1320 MW and 1980 MW respectively. The Engineering, Procurement and
Construction (“EPC”) contract for both the phases have been awarded to
SEPCO-III Electric Power Construction Corporation and Shandong Tiejun Electric
Power Engineering Company Limited. The operations of both these phase are
expected to be commissioned from January and August 2011 respectively and
respective power projects are expected to be fully commissioned by June 2011
and April 2012 respectively.
1980
MW Thermal Coal based power project - Tiroda, Maharashtra through a subsidiary
Company, Adani Power Maharashtra Limited., (APML).
The Company
has been allocated coal blocks at Lohara West and Lohara Extension for
generating up to 1,980 MW of power at their Tiroda power project which have
estimated coal reserves of approximately 170 million metric tons (“MMT”) and an
average gross calorific value (“GCV”) ranging between 4,290 and 5,590 Kcal/kg,
according to the geological report prepared by the Central Mine Planning and
Design Institute Limited. The Company has also applied to the Standing Linkage
Committee, Ministry of Coal, for allocating additional long term coal linkage
for Tiroda power project.
Tiroda
power project will have three super-critical generation units of
660 MW each, with combined capacity of 1,980 MW. The Boiler, Turbine and
Generator (“BTG”) package for Tiroda power project has been awarded to Sichuan
Machinery and Equipment Import and Export Company Limited. They currently
expect that the first 660 MW unit of Tiroda power project will commence
operations from July 2011, and that the power project is expected to be fully
commissioned by April 2012.
1980
MW Thermal Coal based power project - Dahej, Gujarat through a subsidiary
Company, Adani Power Dahej Limited. (APDL)
The Dahej
power project is located close to the Dahej fair-weather lighterage port and
will utilize imported coal as primary fuel for its
operations. The Company has also entered into long-term coal supply
arrangements for importing coal for its Dahej power project. It is expected to have three
super-critical generation units of 660 MW each, with combined capacity of 1,980 MW.
They estimate that construction of the project will commence in
September 2008 and the first 660 MW unit of project is expected to commence
operations from November 2011, and that the project is expected to be fully commissioned
by June 2012.
1320 MW
Thermal Coal based power project - Kawai, Rajasthan through a subsidiary
Company, Adani Power Rajasthan Limited. (APRL)
Kawai
power project: Under a memorandum of understanding, the State
Government of Rajasthan has agreed to use its best efforts to facilitate the
provision of coal for such power project from the Government of India or other
sources. The said power project is expected to have two super-critical
generation units of 660 MW each, with combined capacity of 1,320 MW. It is
estimated that construction of the power project will commence in July 2008.
The first 660 MW unit of power project is expected to commence operations from
October 2011, and that the power project is expected to be fully commissioned
by January 2012.
With the
setting up of the aforesaid mega power projects, the Company will be emerged as
a large integrated player in the power sector having presence in the entire
value chain viz. From coal power trading to coal mining and > power
generation.
B.
Coal Mining
(i). Indian
Coal Mining
Coal is the
most important and abundant fossil fuel in India. The country's industrial
heritage was built upon indigenous coal. Geological Survey of India has
estimated the coal reserves of India at 247.85 billion tonnes of which 92 billion
tonnes are proven. Hard coal deposits spread over 27 major coal fields are
mainly confined to eastern and south central parts of India. Based on
estimates, the consumption of coal is projected to rise by nearly 40% over the
next five years and almost to double by 2020. Indigenous coal mining shall
accordingly form an important segment of the overall power sector thrust area
for the coming years.
With this
backdrop, Indian coal is supposed to be a major fuel source to domestic energy
market for the next century and beyond. As informed last year, the Company has
been selected by Rajasthan Rajya Vidyut
Utpadan Nigam Limited. (RVUNL) for Identifying the techno-economically viable
most suitable coal blocks, liaisoning with Govt. of India and making all efforts
for allotment of the identified coal block(s) to RVUNL and carrying out coal
mining operations for delivery of coal to its power plants. Pursuant to this,
Government of India has allocated Parsa East and Kente Basan coal Blocks
located in Chhattisgarh (Coal Blocks) to RVUNL in June 2007. Further, in
compliance of the condition of the tender, a Joint Venture Company namely,
Parsa Kente Collieries Limited has been incorporated in October 2007 wherein
the Company holds 74% shareholding and RUVNL holds 26% shareholding which will
enter into a Coal Mining and delivery Agreement with RVUNL to undertake the
development and operation of the Coal Blocks and delivering the coal from the
Coal Blocks to RVUNL Thermal Power Stations.
The coal
mining operations in the above said Coal Blocks are expected to start from
April 2010. Further, the Company has been also been selected as successful
bidder for carrying out survey, exploration and mining activities in coal block
allotted to Maharashtra State Mining Corporation Limited at Agarzari, Near
Chandrapur District in the State of Maharashtra. A Joint Venture special
purpose vehicle will be formed to undertake above activities.
The Company
is also actively looking at other opportunities in mining operations in India
and Abroad. The Company will continue to look for more opportunities across
India for other coal mining ventures with State Electricity Boards.
(ii).
Indonesian Coal Mining
Coal is a
global industry, with coal mined commercially in over 50 countries and consumed
in over 70 countries. The world currently uses 5.4 billion tons of coal in
variety of sectors – power generation, iron and steel production, cement
manufacturing and as a fuel. Its production has seen a substantial increase
over the last 20 years, with maximum contribution by Asia.
Indonesia
being the seventh largest coal-producing country in the world has approximately
5.3 billion MT of recoverable coal reserves. Sumatra contains roughly two-third
of Indonesia's total coal reserves, with the balance located in Kalimantan,
West Java and Sulawesi.
The Company
through its subsidiary Company, PT Adani Global, Indonesia has identified 140
million tons coal mine reserves in the Indonesia. The identified reserves are
located in the island of Bunyu in E.Kalimantan, near the border of Malaysia to
the north. The sites are located in the central and northern part of the
island. The preliminary geological investigation has been completed and the
mining would be started followed by the subsequent development. Once the mines
start functioning, the Company will have presence in the entire value chain of
coal business, as the Company is already a leading coal trader. Apart from
this, the Company is exploring more options in Australia, South Africa and
other countries for coal mining.
Power
and Coal Trading
There exists
a large gap between supply and demand of power in large parts of the country.
Inherent diversity in demand of various States in the country also results in
periods of seasonal surplus in one State or Region coinciding with periods of
deficit in another. To capitalize on this growing opportune sector, the Company
had started power trading business in November, 2003 and since then the Company
has already traded more than 7000 Million Units of power till March, 2008 to
the entire satisfaction of surplus / buying utilities of power. The Company has
evolved as a leading private sector power trader in India and targets to
increase its trading volume to 5000 Million Units per annum over next five
years.
The Company
is holding highest category 'F' inter-state license for trading in power by the
Central Electricity Regulatory Commission (CERC) in 2003, wherein the Company
can undertake trading of more than 1,000 Million Units of electricity during
the year, covering the jurisdiction of the entire country, except Jammu and
Kashmir, for next 25 years. Further, during the year, the Company has obtained
membership of first power exchange, Indian Energy Exchange Limited. (IEX) to
widen the scope of services being offered to customers. The Company plans to
include the trading of surplus power from power projects being set up by the
subsidiary Companies in future. The Company also plans to explore power trading
avenues with the neighboring countries like Bhutan, Nepal and Bangladesh and
focusing on long term contracts to drive the volume growth.
Coal is one
of the primary sources of energy, accounting for about 55% of the total energy
consumption in the country. About 75% of the coal in India is consumed in the power
sector. Indian coal has high ash content and low calorific value and India has
also faced a shortage of coal supply for many years, which is expected to
continue as energy needs increase with growth of the Indian economy. Most of
this shortage will need to be met through imports.
During the
year, the Company has maintained its position as the largest importer of coal
in India. The Company has also entered into long-term strategic arrangements
for supply of imported coal, which has lesser Ash content and better calorific
value for higher productivity with largest mining Company of Indonesia. The
Company has also developed relationships with large miners of Indonesia and
China.
City
Gas Distribution
Gas
distribution for Industries, commercial establishments and residences in the
cities has ushered in a new era of cost-efficient and environment friendly
fuel. CNG program introduced in the country due to environmental concerns has
registered an immense success due to the fact that use of CNG holds large price
advantage in automobiles compared with use of conventional fuels like MS and
diesel. The Company aims at improving the environment by setting up a
comprehensive network of CNG stations.
The Company
has forayed into the business of City Gas Distribution Business through its
subsidiary Adani Energy Limited., (AEL) with an objective of providing safe,
convenient, reliable and environment friendly fuel (Piped Natural Gas - PNG and
Compressed Natural Gas – CNG) to the industrial, commercial, household and
transport sectors. Subject has already set up a Gas Distribution Network,
established infrastructure for more than 130 KM of steel pipeline network, 450
KM of PE network, 45 CNG stations for two of Gujarat's most industrialized and
commercial Districts – Ahmedabad and Vadodara. Subject is targeting to serve
more then 250 industrial units, 10,000 households, 100 commercial units and
40,000 vehicles in these cities through its infrastructure network. Subject is
also implementing City Gas Distribution projects to repeat the similar success
stories in Noida, Lucknow and Khurja in UP, Faridabad in Haryana and Udaipur,
Jaipur in Rajasthan. It has already initiated the infrastructure development in
these cities to meet the fuel needs of industrial, domestic, commercial and
Transport sectors. Supply of Natural Gas will definitely bring down the
pollution level in these cities.
Oil
and Gas Exploration
Natural Gas
is rapidly becoming the most preferred source of energy. India ranks 12th in
terms of Natural Gas Reserves with almost 3 bn cubic meters. Most of these
reserves are located in the hydrocarbon rich Krishna-Godavari (KG) basin, Upper
Assam and Cambay basin in Gujarat. Given that India imports around two thirds
of its oil and gas requirement, the sector throws up some exciting
opportunities.
Looking to
this scenario and as part of its integrated strategy, the Company has also
forayed into the Oil and Gas sector and formed a JV Company called Adani
Welspun Exploration Limited. (AWEL) with majority (65%) stake with Welspun
Group for Oil and Gas Exploration and Production business. AWEL has been
awarded two oil and gas blocks in Gujarat and Assam viz. Palej block in Cambay,
Gujarat and Margherita block in Assam under the recently concluded NELP VI
through consortium. AWEL also plans to participate in the upcoming NELP VII
bids and is actively looking at oil and gas blocks overseas
Petro
Products
The Company
has established State of the Art – Bunkering (Ship Fuelling Business)
facilities at Mundra Port with procurement of two products barges of 3,000 MT
capacity each, storage and blending facility in place. This strategically
located bunkering facility competes with the two major bunkering hubs in Asia
viz. Singapore and Fujairah. The ever increasing traffic of vessels ensures
strong demand for ship fuel in the coming years. Hence, the bunkering business
has a great potential to achieve higher volumes by 2010.
During the
year, in order to carry on business of bunkering in various ports of India, the
Company has formed JV Companies with Chemoil Group of Singapore in Singapore
having 50 : 50 equity participation. This strategic Joint Ventures will
significantly boost up the bunkering activities of the Company.
Business:
Real Estate
The Indian
real estate sector is on a strong growth path, led by rising GDP, increasing
demographics, growing affordability, increasing impact of IT/ITES and organized
retail sectors, supported by strong FDI and portfolio inflows. The
unprecedented demand has driven the need for organized sources of funding,
creating 'investability' and has led to the emergence of real estate as a
sustainable asset class. Investable real estate assets in India are only 7-8%
of India's GDP compared with 40-50% in most developed economies. The office
space in India is also far lower when compared with international peers like
Hong Kong and New York. Against this backdrop, real estate sector in India is
likely to grow.
The Company
has forayed into the Real Estate Sector through its subsidiary, Adani
Infrastructure and Developers Private Limited (AIDPL). AIDPL has enhanced its
scope of operations in a short span of time, developing large integrated
townships as well as commercial and retail properties. It has a approx 105 mn
sq ft of Floor Space Index (“FSI”) under development, which is expected to be
fully executed in the next five years. The projects are a combination of Sale
and Lease models, on a case to case basis. It has built up land bank at
strategic locations and is partnering with other realty players to ensure that
the execution moves ahead as per schedule.
Projects :
I.
“Shantigram” – an Integrated Township at Ahmedabad, Gujarat.
The Company
through its subsidiary, Shantigram Estate Management Private. Limited. (SEMPL) is
also in the process of developing a 578 acre township in Shantigram, Ahmedabad.
“Shantigram” is intended to be one of the largest townships of its kind
sprawling across 41.6 mn sq ft of saleable area. The project involves
residential, commercial and plotted development as well as a 50 acre ITITeS
SEZ. The construction work on the project has started and is expected to be
completed by financial year 2012-13. The Project shall provide the amenities
like Recreation, Sports and Leisure, Public and Private Constituents, and
Shantigram Public Utility Infrastructure. The SEZ has been proposed to be a
part of Township and shall ensure to provide the amenities available within the
Township.
II.
Commercial and Residential Development in Mumbai
Mumbai is a
commercial capital of India and is the sixth largest metro in the world. As a
result, Mumbai offers a plethora of employment opportunities and this in turn
has led to an increase in its population. With scare residential space to cater
to an ever increasing population and dwindling commercial area in the event of
enhanced economic activity, Mumbai realty prices have hit the roof. To
capitalize on this segment, the Company through its subsidiary, Adani
Developers Private. Limited. (ADPL) has identified two properties in Mumbai.
III.
“Bandra Kurla Complex” (BKC)
BKC has been
developed as one of the most sought prime commercial micro-market in Mumbai. It
is expected to become the secondary Central Business District (CBD) of Mumbai
due to the factors like the quality infrastructure, availability of land by
MMRDA, established Companies, road width, easy accessibility, etc. The Company
is developing 2.2 mn sq ft of commercial cum retail project at Bandra–Kurla
Complex (BKC). The site is located at International Finance and Business Centre
(IFBC) in Bandra-Kurla Complex (BKC). The Company proposes to develop
commercial multi-storey towers in this land. Project work has been commenced
and is expected to be complete in the next 3 financial years.
IV.
“Mill land Development” in Mumbai City (Borivali and Byculla)
The Company
is also developing a residential complex in Boriville (approx 1.2 mn sq ft) and
a commercial complex in Byculla (approx 0.70 mn sq ft) both of which are part
of the Mill Land Development Programme (MLDP) through a JV Company, Swayam
Realtors and Traders Limited. In which it has 60% stake. The land has been
acquired through the BIFR process, ensuring clean title and no legal issues.
V.
Mundra Mass Housing Project, Mundra , Gujarat
The Company
is developing a Township project at Mundra Port and SEZ (MPSEZ), through a
subsidiary Company, Adani Mundra SEZ Infrastructure Private. Limited., spanning
over 600 acres of land. The project work has already been commenced. The
project would provide infrastructure support to families involved in developing
MPSEZ over the next 5-10 years. The total developable area of the project is
expected to be approx 50 mn sq ft.
VI.
Other Developments – Surat and Kochi
Apart from
the projects mentioned above, the Company is also developing 5.6 mn sq ft of
Commercial and Residential property in Surat. Land acquisition of the 57 acres
is in process and the construction is expected to start in financial 2008-09.
The Company has also tapped the southern region with project spanning 27 acres
of land in the prime location of Kochi. The plan involves developing 3.2 mn
sqft of saleable area with 85% high end residential and 15% commercial space.
Business:
Agro
I.
Agro Commodities Trading
India is one
of the world's largest food grains producers, the second largest vegetable
producer and rice producer, making it one of the world's agricultural
powerhouses. With global agricultural trade on a sustained rise coupled with
robust economic growth across the world, the Agro sector has number of trade
opportunities in its offing, which is an important contributor to India's
growth story.
The Company
is a leading trader of diversified Agri Commodities in India and
Internationally with emphasis on entire range of grains, pulses, castor and
soya, oil and oil meals and food grains. The Company is present in every aspect
of trade of bulk agro commodities from importing, selling domestically to
exporting and doing third country trade. The Company has a geographical
presence in Europe, Japan, Korea, China, USA, Canada, Australia, South East
Asia, Middle East, South Asia and almost all over the globe with its Agro
Business.
The Company
has also identified development of Rural and Farm infrastructure as a thrust
area for the coming year and dedicates itself for the cause of creating
facilities to minimize inefficiencies in the form of wastages being faced today
by the country. The Company's trading model would be subsequently integrated
with planned infrastructure so as take achieve higher feats.
II.
Edible Oil
The Company
had commenced trading in Edible Oil since 2000 and looking to the urbanization
and increasing demand of packed oil, ventured into Edible Oil Refining through
50 : 50 JV Company, Adani Wilmar Limited. (AWL). It established first Indian
port based edible oil refinery through Mundra. With the enhancement of refining
capacity, location specific products and branding efforts, AWL has also
acquired refineries at Mantralayam, Bundi and Haldia. AWL has promoted its
products under the brand “Fortune”. “Fortune” is India's largest edible oil
brand commanding 17% market share. The “Fortune” brand products are available
in various range of edible oil. It includes Soya Oil, Sunflower Oil, Groundnut
Oil, Non Refined Mustard Oil and Cotton Seed Oil. Other growing brands of AWL
are “Naturalle”, “Raag” and “Kachi Ghani”.
During the
year, AWL has added coconut oil to its product basket under the name
“Naturelle”, which is receiving encouraging response in the market. During the last
6-7 years of its operations, AWL has spread its distribution network across
India and exports to more than 19 countries in the Middle-East, South East Asia
and East Africa. Today, AWL has distribution foot prints all across the country
with 88 stock-points catering to more than 6000 distributors and numerous
brokers and other trade associations. AWL's retail reach is at more than
6,00,000 outlets. Looking to domestic needs and established distribution
network, AWL has also added Vanaspati Ghee under “Raag” brand and bakery
shortening under “Jubilee” brand to its product basket. AWL is continuously
increasing its market share in sunflower and vanaspati edible oil. With the
best brand and network, AWL is poised to grow rapidly in the years to come.
III. Fruits
and Vegetables
India is 2nd
largest producer of fruits and vegetables in the world but contributes less
than 1% of total production of fruits and vegetables due to lack of post
harvest technologies, logistics and improper storage.
To capitalize
on this segment, the Company through its subsidiary viz, Adani Agri Fresh
Limited (AAFL) has taken the lead in developing logistics integrated storage,
handling and transportation infrastructure for fruits and vegetables and set up
modern Controlled Atmospheric Storage facilities for storage of fruits and
vegetables with European technology at three locations viz. Rewali, Sainz, and
Rohru in Himachal Pradesh having a combined capacity of around 18,000 MT. AAFL
also plans to roll out of pack house facilities in Maharashtra, Gujarat, Andhra
Pradesh and Karnataka in a phased manner. AAFL has already set up a strong
marketing network in 30 major towns across India for wholesale, cash and carry
and organized retail.
The strategy
of the said Company is to concentrate on products that are produced far from
major consumption centers, are seasonal in nature and are amendable to increase
in storage life using modern integrated cold chain facilities. This would
enable the Company to leverage on its logistics strength while at the same time
take advantage of controlled atmospheric storage technology to arbitrage on the
price differential between peak and off peak season. Initially the project
would be focused on apples and would then diversify into other fruits and
vegetable products in a planned phased manner. During the year, AAFL has
handled 4800 MT of apples and plans to procure around 16,000 MT of apples in
the FY 08-09.
IV.
Agro Supply Chain
In order to
reduce storage and transit losses of food grains and to bring additional
resources through Private Sectors participations, Govt. of India had announced
a National Policy on Handling Storage and Transportation of Foodgrains in June,
2004 for Bulk and conventional godowns. Adani Agri Logistics Limited. (AALL) a
subsidiary of the Company was awarded the project by Food Corporation of India
to implement a bulk food grains handling, storage and transportation, which
will be implemented on a commercial Build, Own, Operate (“BOO”) format. The
project includes the development, design, financing, construction, operation
and maintenance of state-of-the-art
facilities at
the project sites. The project is spread across 8 (eight) locations across
India namely, Moga, Kaithal, Hooghly, Navi Mumbai, Chennai, Coimbtore and
Bangalore. AALL also plans to create more storage capacities and related
infrastructure at multiple locations across India.
Business:
Metals and Minerals
The Company's
metals and minerals businesses includes trading in iron ore, scrap metal and
gems and jewellery. The Company exports iron ore to
China from mines near its captive port facility in Belekeri,
South India. The Company also plans to undertake captive iron ore mining
operations in Karnataka.
I.
Metal Scrap Business
The Company
is a leading metal scrap trader in the Indian sub-continent with buyers of
India, Pakistan and Bangladesh. The metal scrap is sourced from world's top 5
metal scrap suppliers based at United States and Europe and the Company is the
preferred supplier to many large customers. The Company has also started metal
scrap trading in the containerized shipments. The Company is a leading player
in un-branded studded jewellery and gold medallion with manufacturing base in
Surat SEZ and has also entered into outsourcing arrangements with large manufacturers.
II.
Ship Dismantling Business
The Company
through its Subsidiary, Adani Virginia Inc. has purchased a ship dismantling
Company in USA namely, Bay Bridge Enterprise LLC. (“Bay Bridge”), a ship
breaking unit which is one of the six yards registered with Maritime Authority
of USA with highest order of environment protection. The said Company has
already dismantled 10 Vessels from Maritime Administration of US since June
2005. It would now be focusing on acquiring the vessel from US Navy. Bay Bridge
has also started Trans-load operation in Virginia to facilitate Scrap Trading
business of its parent Company. The Company is currently serving 2000-3000 Mt.
of Cargo each Month and projecting the Volumes for Trans-load to 60000 Mt. by
Next Year.
The heading
requirement of dismantling obsolete vessels combined with growing requirement
of scrap metal world wide has led to an increased demand for ship breakers in
USA. Bay Bridge will capitalize the opportunities in the ship breaking business
through it's another footing in operation at Brownville, Texas. The Company
will create a Ship-breaking Facility in Brownville, Texas and shall be able to
capitalize the US market more than 25%.
Shipping
as a backbone to Company's businesses
Shipping is
the largest and the most important mode of international transportation for the
country. Around 95% by volume and 70% by value of India's overseas trade is
sea-borne. To capitalize on this growing segment and to backward integrate its
existing strong global trading, logistics and infrastructure operations which
are largely sea borne, the Company has established subsidiary Companies in
Singapore to manage its shipping and freight operations.
During the
year, the Company has chartered around 273 ships to move various products sum-up
to 14 Mn Mt. The Company also plans to acquire two capsize vessels newly built
with expected delivery by Dec 2010 in the initial phase. The Company will also
use the fleet of vessels for handling the third party cargo. This will help the
Company to effectively manage its international cargo operations and to
generate additional revenues from shipping its own captive as well as third
party cargo.
Competition/Outlook
on opportunities
Competition
The
businesses in which the Company is engaged are highly competitive and has
competitors in each of its major business operations on a local, regional,
national and international levels. Although barriers to entry are high in a
number of the Company's businesses due to the costs associated with sourcing
commodities and managing their transportation, the Company faces additional
competition from new entrants and from its existing customers who are becoming
more involved in sourcing to satisfy their own supply requirements. The markets
for the Company's metals, minerals, ores, agro-commodities and energy products
are also price competitive and sensitive to product
substitution.
In many of these businesses, the Company's competitors have greater economies
of scale and are also more vertically integrated and generally not only act as
commodities merchants but also as processors, which allow them to make a higher
margin. Competition with these and other suppliers, processors and distributors
is based on price, quality of service and geographic location.
Financial
Performance with respect to operational performance
The
Management is pleased to inform you that the year witnessed many fold increase
in the business activities of the Company. They take pride in informing you
that the Company has maintained its dominance, achieved a significant growth
and recorded a yet another stellar financial performance.
Details of
various milestones achieved and financial performance of the Company with
respect to operational performance are as under :
Revenues:
During the
year, the Company has recorded total income to the tune of Rs. 115954.4
millions as compared to Rs. 101516.6 millions of the previous year which show
an increase of 14% over the last year.
Fixed Assets
Tangible
- Land
- Building
- Plant and
Machinery
- Furniture and
Fixtures
- Electrical
Fittings
- Office
Equipment
- Computer
Equipments
- Vehicles
- Air Craft
- Ship
Intangible
- Software
OTHER details:-
Contingent Liabilities not provided for:
|
PARTICULARS |
31.03.2008 (Rs. In Millions) |
|
Claims against
the Company not acknowledged as Debts |
389.900 |
|
In respect of
Corporate Guarantee given:- |
|
|
To Companies
under the same Management |
942.900 |
|
For
obligations to other parties |
1199.100 |
|
Bills of
Exchange Discounted |
10429.400 |
|
Demand
against the Company not admitted as debts regarding
sales tax against which appeals are pending |
21.600 |
|
In respect of
Bank Guarantees given to Government Agencies |
74.800 |
|
In respect of
partly paid shares |
---- |
|
Export obligation of Rs. 6.04 (Previous
Year Rs. 6.62) is pending which is equivalent to 8 times of duty saved Rs.
0.76 ( Previous Year Rs. 0.83) |
|
|
Certain claims / show cause notices
disputed have neither been considered as contingent liabilities nor acknowledged
as claims, based internal evaluation of the management. |
|
|
Show cause
notice in terms of value of export goods under section14 of the Customs Act,
1962 read with section 11 of FTDR Act, 1992 and rule 11 and 14 of FT(Regulation)
Rule, 1993 in which liability is unascertainable. |
|
Website DETAILS:-
Subject is the
flagship company of The Adani Group and is actively involved in the Global
Trading Business.
With its head office
in Ahmedabad, India, subject has extended its activities across the globe.
Today, subject has branched out into several offices in India and abroad.
(Singapore, UAE, USA, etc.)
Subject commenced
its operations in 1988, driven by the desire "To become the leader in
trading business. Its trade desks handle a diverse and voluminous product
portfolio with expertise. The product range is organized under the “T.E.A.M.” structure correctly amplifying the required
cohesiveness of a knowledge based and people driven entity. Textiles-denim,
yarn, cotton grey, silk, printed fabric and so on; Energy desk with Coal, Coke,
Iron ore, Petroleum and Petrochemicals; Agriculture products like wheat, rice,
oilseed meal, pulses, groundnuts; Metals desk with products like ferrous scrap
and precious metals comprising of gold and value added diamond business.
The product
portfolio also includes Iron ore, fertilizer raw materials and several other
items. With a long-term vision, the Company is developing minor Port at
Belekeri, North Karnataka to handle iron ore and other bulk cargo.
Group Highlights
Founded in 1988
the Adani Group has grown from being a trading house to a diversified and
dynamic business group with interests from infrastructural development to
FMCGs.
A leader in
international trading and infrastructure development, the Adani Group is
engaged in a continuous Endeavour to maximize potentialities by synergizing the
multiple businesses of the Group creating optimum business model.
The Group has
made foray into high growth sector like Power, Infrastructure, Global Trading,
Logistics, Energy and is recognized for creating benchmarks for others to
follow… They are the operator of largest private port in India, They are the
developer of largest multiproduct SEZ in India, They have the largest edible
oil refining capacity in India, and they are one of the largest trading houses
in India.
The group is
committed to constantly deliver good returns to its stakeholders and convert
partnerships into winning combination.
Products
Subject is today an
international trading house dealing in nearly 40 commodities in more than 55
countries around the world.
Subject operates
from 14 corporate centers in India. It operates overseas branches in Dhaka,
Dubai, Moscow, Singapore and South Korea, and maintains a long list of contact
offices around the world to provide easy access to its clientele.
Its chosen product
categories are: Agro-products, Coal and Coke Products, Textiles, Fertilizers
and Steel Scrap, Marine Products, Petrochemicals, Petroleum Oil and Lubricants,
etc.
Through
time-conscious delivery, quality-driven process systems, total reliability and
unusual levels of commitment to customer satisfaction, Adani Group has found
great success in marketplaces around the world, and a rock-solid reputation.
MEDIA RELEASE
The Board at its
meeting dated 21st May, 2007 under took the following major
activities:
Sales and
Operating income has gone up for the quarter ended 31 March 2007 to Rs.34260 Millions
from Rs. 32560 Millions in the corresponding previous year quarter, showing a
growth of 5%. For the full year the same has increased by 9% to Rs.101560
Millions.
EBIDTA for the quarter
ended 31 March 2007 has increased to Rs.1120 Millions as compared to Rs.91 in
the corresponding previous year quarter. For the full year the EBIDTA has been
Rs.3500 Millions showing an increase of 29%.
PBT and PAT for
the quarter has increased by 10% to Rs.950 Millions and 1% to Rs.660 Millions.
For the full year the PBT and PAT has increased to Rs.1980 Millions and Rs.1510
Millions i.e. 27% and 27% respectively.
On a consolidated
basis, the Company’s Sales and
Operating income has increased by 37% to Rs 169490 Millions as
compared to Rs 123410 Millions in the corresponding previous period.
EBIDTA on a consolidated
basis has increased by 49% to Rs 4740 Millions as compared to Rs 3180 Millions
for the corresponding previous period.
The PAT of
the company on a consolidated basis has also improved by 28% to Rs 1730
Millions as compared to Rs 1350 Millions for the corresponding previous period.
The company
successfully placed Foreign Currency Convertible Bonds of US$250 million in
January 2007. The proceeds of the issue would help in the successful
implementation of various projects being undertaken by the company towards coal
mining, shipping, etc.
The Company
continues to be focused on its four business segments namely:
Energy, Agro, Metals and Minerals and Infrastructure
and Logistics
Under the Energy Segment,
-
it continues to be the largest Coal importer in India. Adani Power
Limited, its wholly owned subsidiary is implementing a project for generation
of 2640 MW of electricity in three phases. Of this, the company has entered
into a long term agreement with Gujarat Urja Vikas Nigam Limited, to supply
2000 MW of electricity. The company through its wholly owned subsidiary in
Indonesia, is also engaged in developing coal mines, which will prove to be a
big asset to flank its power plant as well as the coal trading business.
-
The company has successfully commenced the bunkering business i.e.
supply of fuel to ships through its unit in the Mundra SEZ.
-
The consortium, where the company is a majority stake holder has been
awarded two onshore blocks for Oil and Gas exploration under the NELP – VI viz.
one in Gujarat and another one in Assam. The consortium has also been awarded
one onshore block in Thailand for Oil and Gas exploration.
The Agro business of the company
has shown continuous superior performance in trading of various agro commodities.
-
Adani Agri Fresh Limited, its wholly owned subsidiary, is the first company
in India to have successfully implemented Controlled Atmosphere Storage
Facilities (CASF) for the storage and trading of fruits and vegetables under
controlled climatic conditions;
-
Adani Agri Logistics Limited, its wholly owned subsidiary, is setting up
fully mechanized silos for the storage of food grains, again the first of its
kind in India, and has entered into a long term contract with Food Corporation
of India.
-
Adani Wilmar Limited, the 50% joint venture with Wilmar group,
Singapore, has continued to maintain its market dominance in the branded edible
oil segment with its brand ‘Fortune’.
In the Metals
and Minerals business, the company continues to be one of the major exporters
of iron ore. Through its wholly owned subsidiary, Adani Global FZE, it
continues to be the largest importer of ferrous scrap in sub-continental India.
Bay Bridge Enterprises LLC, the wholly owned subsidiary in US engaged in the
business of dismantling ships, has shown good performance.
In the Infrastructure
and Logistics segment, the company through its subsidiaries is developing
around 25 mn sq. feet of integrated commercial and residential projects in Ahmedabad
and Mumbai. The company has also placed orders for two large bulk carriers of
175,000 tonnes each with a Korean Shipyard to cater to its internal cargo
requirements.
CMT REPORT
(Corruption, Money Laundering and 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.50.52 |
|
UK Pound |
1 |
Rs.75.08 |
|
Euro |
1 |
Rs.63.72 |
SCORE and RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
9 |
|
PAID-UP CAPITAL |
1~10 |
9 |
|
OPERATING SCALE |
1~10 |
9 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
10 |
|
--PROFITABILIRY |
1~10 |
8 |
|
--LIQUIDITY |
1~10 |
9 |
|
--LEVERAGE |
1~10 |
9 |
|
--RESERVES |
1~10 |
9 |
|
--CREDIT LINES |
1~10 |
9 |
|
--MARGINS |
-5~5 |
---- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
81 |
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 and 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 and 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 |
|