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MIRA
INFORM REPORT
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Report Date : |
19.12.2008 |
IDENTIFICATION
DETAILS
|
Name : |
STERLITE INDUSTRIES (INDIA) LIMITED |
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Registered Office : |
SIPCOT Industrial Complex, Madurai By Pass
Road, T V Puram P.O., Tuticorin -628 002, Tami Nadu, India |
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Country : |
India |
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Financials (as on) : |
31.03.2008 |
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Date of Incorporation : |
08.09.1975 |
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Com. Reg. No.: |
18-62634 |
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CIN No.: [Company
Identification No.] |
L65990TN1975PLC062634 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
MUMS36821B MUMS22522D |
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PAN No.: [Permanent
Account No.] |
AABCS4955Q |
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Legal Form : |
Public limited liability company. The company’s shares are listed on the Stock Exchanges. |
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Line of Business : |
Manufacturer of Telephone Cables, Copper Rods and Aluminium Rolled Products. |
RATING &
COMMENTS
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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 700000000 |
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Status : |
Good |
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Payment Behaviour : |
Slow but Correct |
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Litigation : |
Clear |
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Comments : |
Subject is a well-established and reputed company and a part of
Sterlite 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 as per
commitments. Fundamentals are strong and healthy. The company can be considered fro business dealings at usual trade
terms and conditions. The company can be regarded as promising partner in a medium to
long-run. |
LOCATIONS
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Registered Office : |
SIPCOT Industrial Complex, Madurai By Pass
Road, T V Puram P.O., Tuticorin -628 002, Tami Nadu, India |
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Tel. No.: |
91-461-6612591/ 600 |
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Fax No.: |
91-461-2340203 |
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E-Mail : |
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Website : |
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Head Office : |
B-10/4, Waluj MIDC Industrial Area, Waluj, District Aurangabad – 431133, Maharashtra, India |
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Tel. No.: |
91-240-2554583/2554589 |
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Fax No.: |
91-240-2554690 |
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E-Mail : |
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Regional Offices : |
Northern
Regional Office |
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Tel. No.: |
91-11-24366023 / 24365225 / 24366653 |
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Fax No.: |
91-11-24366023 |
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E-Mail : |
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Regional Offices : |
Southern
Regional Offices 705, 7th Floor, North Rear Wing, Manipal
Centre, Dickenson Road, Bangalore - 560001 |
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Tel. No.: |
9180-25559548 / 25559549 |
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Fax No.: |
9180-25559553 |
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E-Mail : |
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Regional Offices : |
Eastern
Regional Office Chatterjee International Centre, 20th
Floor, 33 A Jawaharlal Nehru Road, Kolkata - 700071. |
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Tel. No.: |
91-33-22465968 |
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Fax No.: |
91-33-22465968 |
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E-Mail : |
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Regional Offices : |
Western
Regional Office Vedanta, Business Square, C Wing, 2nd Floor.
Andheri Kurla Road, Chakala, Andheri (East), Mumbai - 400 093. |
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Tel. No.: |
91-22- 66434500 |
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Fax No.: |
91-22-66434530 |
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E-Mail : |
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Corporate Office : |
Dhanraj Mahal, 5th Floor, C.S.M. Road, Appollo Bunder, Colaba, Mumbai – 400 039, Maharashtra, India |
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Tel. No.: |
91-22-22855551/22854406 |
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Fax No.: |
91-22-22836474 |
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E-Mail : |
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Corporate Office : |
92, Maker Chamber III, Nariman Point, Mumbai – 400 021 |
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Tel. No.: |
91-22-22835261/22835316/22844864 |
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Fax No.: |
91-22-22845015 |
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E-Mail : |
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Corporate Office : |
Vedanta, 75 Nehru Road, Vile Parle (East), Mumbai-400099,
Maharashtra |
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Factory : |
Sterlite Optical Fibres Unit: E-2, MIDC Industrial Area, Waluj, Dist - Aurangabad – 431 136, Maharashtra Tel. No. 91-240-2564599/2554079 Fax No. 91-240-2564598/2564066 E Mail sclof@giaspn01.vsnl.net.in Sterlite Telecom Cables Unit: Survey No. 209, Piparia Industrial Estate, Silvassa, (Dadra Nagar & Haveli), Union Territory Tel. No. 91-2638-241108/241113 Fax No. 91-2638-240394 Sterlite Aluminium Foils Unit: Aluminium Foils & Sheets Division Gate Nos. 924-927, Sanaswadi, Tal. Shirur, Dist. Pune – 412 208, Maharashtra Tel. No. 91-2137-252308/252309/252438/252439 Fax No. 91-2137-252407 E Mail sterlite@pn2.vsnl.net.in Jelly Filled Cables: Unit I : B-10/4, Waluj MIDC Industrial Area, Waluj, Dist. Aurangabad – 413 133, Maharashtra Unit II : Survey No. 209, Piparia Industrial Estate, Phase II, Silvassa – 396 230, Dadra & Nagar Haveli (Union Territory) Optical Fibre: E-1, MIDC Industrial Area, Waluj, Dist - Aurangabad – 431 136, Maharashtra Continuous Cast Copper Rods: Unit I : Bombay-Pune Highway, P.O. Takwe Khurd, Taluka Maval Lonavala, Dist. Pune – 410 405, Maharashtra Unit II : Survey No. 209, Piparia Industrial Estate, Phase II, Silvassa – 396 230, Dadra & Nagar Haveli (Union Territory) Copper Cathodes (Smelter): Zone A & B, Sipcot Industrial complex, Tuticorin – 628 002, Tamil Nadu Copper Cathodes (Refinery): Plot No. 1/1/2, Village Chinchpada, Silvassa – 396 230, Dadra & Nagar Haveli (Union Territory) Power
Transmission Line Aluminium Conductor: Karanjawane, Taluka Velhe, Dist. Pune – 412 305, Maharashtra Power
Transmission Line Aluminium Conductor: Rakholi, Madhuban Dam Road, Silvassa – 396 230, Dadra & Nagar Haveli (Union Territory) 7, Kirol, Vidyavihar, Mumbai-400086, Maharashtra, India SIPCOT Industrial Complex, Madurai Bypass Road, T.V. Puram P.O., Tuticorin-628002, Tamilnadu, India |
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Secretarial Department : |
Solitaire Corporate Park, Business Square Centre, C Wing, 2nd Floor, Andheri Kulra Road, Chakala, Andheri (East), Mumbai-400093 |
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Tel. No.: |
91-22-66434500 |
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Fax No.: |
91-22-66434551 |
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E-Mail : |
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Branches : |
904-905, Tolstoy House, Tolstoy Marg, New Delhi – 110 001 |
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Tel. No.: |
91-11-23736941/23351393 |
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Fax No.: |
91-11-23355768/23736988 |
DIRECTORS
|
Name : |
Mr. Anil Agarwal |
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Designation : |
Chairman and Managing Director |
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Name : |
Mr. Kuldip Kumar Kaura |
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Designation : |
Managing Director and Chief Executive Officer |
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Name : |
Mr. Narendra Mehta |
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Designation : |
Director |
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Name : |
Mr. Dwarka Prasad Agarwal |
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Designation : |
Director |
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Name : |
Mr. Ishwarlal Patwari |
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Designation : |
Director |
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Name : |
Ms. Suvalaxmi Chakraborty |
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Designation : |
ICICI Nominee Director |
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Name : |
Mr. Navin Agarwal |
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Designation : |
Executive Vice-Chairman |
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Name : |
Mr Berjis Desai |
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Designation : |
Director |
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Name : |
Mr. Sandeep Junnarkar |
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Designation : |
Director |
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Name : |
Mr. Gautam Doshi |
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Designation : |
Director |
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Name : |
Mr. Tarun Jain |
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Designation : |
Whole Time Director |
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Name : |
Mr. Dwarka Prasad Agarwal |
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Designation : |
Director |
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Name : |
Mr. Suvalaxmi Chakraborty |
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Designation : |
Nominee Director (ICICI) |
KEY EXECUTIVES
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Name : |
Mr. S. Varadharajan |
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Designation : |
Company
Secretary
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Name : |
Mr.
Narendra Mehra
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Designation : |
Company
Secretary
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MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
(As on 30.09.2008)
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
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A) Shareholding of Promoters and promoter Group |
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1 Indian |
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Individuals/ Hindu Undivided Family |
207040 |
0.03 |
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Bodies Corporate |
25664125 |
3.62 |
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2 Foreign |
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Bodies Corporate |
403715750 |
56.98 |
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B) Public Shareholding |
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1 Institutions |
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Mutual Funds/ Axis |
25669433 |
3.62 |
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Financial Institutions/ Banks |
1160766 |
0.16 |
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Central Government/ State Government(s) |
700 |
0.00 |
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Insurance Companies |
24673375 |
3.48 |
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Foreign Institutional Investors |
44764685 |
6.32 |
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Non Institutions |
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Bodies Corporate |
25958506 |
3.66 |
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Individuals |
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i. Individual shareholders holding nominal share capital up to Rs. 0.100 Million |
22290940 |
3.15 |
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ii. Individual shareholders holding nominal share capital in excess of Rs. 0.100 Million |
7336970 |
1.04 |
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Non resident Indian |
1009968 |
0.14 |
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Trusts |
17762372 |
2.51 |
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Foreign Bodies Corporate |
1526682 |
0.22 |
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Clearing Members |
1698195 |
0.24 |
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Overseas Corporate Bodies |
100 |
0.00 |
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Share held by Custodian and against which Depository Receipts have been issued |
105054804 |
14.83 |
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|
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Totals |
708494411 |
100.00 |
BUSINESS DETAILS
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Line of Business : |
Manufacturer of Telephone Cables, Copper Rods and Aluminium Rolled Products. |
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Products : |
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PRODUCTION STATUS
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Particulars |
Unit |
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Installed
Capacity |
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Continuous Cast Copper Rods |
MT |
|
268000 |
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Copper Cathodes |
MT |
|
405000 |
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Aluminium Cold Rolled Products |
MT |
|
20000 |
|
Sulphuric Acid |
MT |
|
1300000 |
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Phosphoric Acid |
MT |
|
180000 |
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Power Transmission Line Aluminium Conductors (AAC/ ACSR) |
KM |
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-- |
GENERAL
INFORMATION
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Suppliers : |
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No. of Employees : |
5000 |
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Bankers : |
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Facilities : |
Notes: 1 Debentures
referred at (a) above are secured by a first charge on pari passu basis in favour
of the trustees for the debentures on the immovable properties situated at
Tuticorin in the State of Tamilnadu Lonawala and Pune in the State of
Maharashtra, Chinchpada in the UT of Dadra and Nagar Haveli and Mouje Chatral
of Kalol Taluka, District Gandhinagar, Gujarat. 2 Working
capital loans from banks are secured by a first charge by way of
hypothecation of the Company’s present and future inventories and book debts.
These loans are further secured by a second charge on all the immovable
properties of the Company.
Note: Amount due
within one year Rs.26391.600 Millions |
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Banking
Relations : |
Good |
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Auditors : |
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Name : |
Chartered Accountants Mumbai
Chartered Accountants Kolkata, West Bengal |
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Memberships : |
Confederation of Indian Industry |
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Holding Companies : |
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Subsidiaries : |
Subsidiaries :
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Associates : |
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CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
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|
925000000 |
Equity Shares |
Rs. 2/- each |
Rs.1850.000 Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
708494411 |
Equity Shares |
Rs. 2/- each |
Rs.1417.000
Millions |
Notes:
Of the above
equity shares:
a) 2,10,000 equity
shares were allotted as fully paid-up pursuant to a contract without payment being
received in cash before buy back, extinguishment, subdivision and issue of
bonus shares.
b) 321973026
equity shares of Rs. 2/- each were allotted as fully paid-up bonus shares by
way of capitalisation of general reserve and share premium.
c) 2733675 equity
shares were allotted pursuant to scheme of amalgamation without payment being
received in cash before buy back, extinguishment, subdivision and issue of
bonus shares.
d) 4099400 equity
shares were allotted as fully paid-up on conversion of 50,000 foreign currency
convertible bonds before subdivision and issue of bonus shares.
e) 150000000
American Depository Shares (ADS) at US$13.44 per share, representing 150000000
underlying equity shares.
Of the above
equity shares, 429329150 equity shares are held by the Company’s holding
company and by fellow subsidiary of the Company.
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 |
1417.000 |
1117.000 |
777.500 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
130233.200 |
43462.300 |
40446.600 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
131650.200 |
44579.300 |
41224.100 |
|
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LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
5720.500 |
1000.000 |
1259.200 |
|
|
2] Unsecured Loans |
26857.600 |
27097.500 |
19088.700 |
|
|
TOTAL BORROWING |
32578.100 |
28097.500 |
20347.900 |
|
|
DEFERRED TAX LIABILITIES |
3623.300 |
3192.700 |
3274.100 |
|
|
|
|
|
|
|
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TOTAL |
167851.600 |
75869.500 |
64846.100 |
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APPLICATION OF FUNDS |
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|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
16554.900 |
17172.400 |
17390.700 |
|
|
Capital work-in-progress |
524.900 |
322.300 |
710.000 |
|
|
|
|
|
|
|
|
INVESTMENT |
123570.300 |
29129.600 |
26717.800 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
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CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
23059.900
|
18491.600
|
10191.800
|
|
|
Sundry Debtors |
8318.800
|
9140.700
|
5758.000
|
|
|
Cash & Bank Balances |
769.800
|
2320.700
|
7937.700
|
|
|
Other Current Assets |
0.000
|
0.000
|
21.500
|
|
|
Loans & Advances |
12611.100
|
13766.200
|
12520.500
|
|
Total
Current Assets |
44759.600
|
43719.200
|
36429.500
|
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
7873.900
|
11094.000
|
9078.700
|
|
|
Provisions |
9684.200
|
3380.000
|
7326.600
|
|
Total
Current Liabilities |
17558.100
|
14474.000
|
16405.300
|
|
|
Net Current Assets |
27201.500
|
29245.200
|
20024.200
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
3.400 |
|
|
|
|
|
|
|
|
TOTAL |
167851.600 |
75869.500 |
64846.100 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
|
|
|
|
|
|
|
Sales Turnover |
126719.800 |
118218.500 |
75039.000 |
|
|
Other Income |
6023.900 |
2054.100 |
3694.000 |
|
|
Total Income |
132743.700 |
120272.600 |
78733.000 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
11044.700 |
9123.000 |
6787.600 |
|
|
Provision for Taxation |
1528.400 |
1282.700 |
1676.400 |
|
|
Profit/(Loss) After Tax |
9516.300 |
7840.300 |
5111.200 |
|
|
|
|
|
|
|
|
Earnings in Foreign Currency : |
|
|
|
|
|
|
Export Earnings |
70339.700 |
72118.400 |
42382.100 |
|
|
Management Fees |
0.000 |
0.000 |
59.000 |
|
Total Earnings |
70339.700 |
72118.400 |
42441.100 |
|
|
|
|
|
|
|
|
Imports : |
|
|
|
|
|
|
Raw Materials |
NA |
NA |
61544.900 |
|
|
Stores & Spares |
NA |
NA |
171.200 |
|
|
Capital Goods |
NA |
NA |
65.500 |
|
Total Imports |
NA |
NA |
61781.600 |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Purchases |
20.800 |
141.600 |
0.000 |
|
|
Manufacturing Expenses |
116876.200 |
107796.400 |
67021.400 |
|
|
Personnel |
661.800 |
574.400 |
0.000 |
|
|
Selling and Distribution |
661.800 |
717.800 |
0.0000 |
|
|
Increase or decrease in stock |
(1308.000) |
[3588.500] |
0.000 |
|
|
Administrative Expenses |
1155.000 |
1040.900 |
1203.700 |
|
|
Salaries, Wages, Bonus, etc. |
0.000 |
0.000 |
464.700 |
|
|
Interest and Financial charges |
1644.500 |
1826.600 |
1203.700 |
|
|
Depreciation & Amortization |
1389.800 |
1332.000 |
1282.300 |
|
|
Less : Preoperative Expenses of projects |
0.000 |
[65.600] |
(65.800) |
|
|
Other Expenditure |
597.100 |
2214.500 |
816.000 |
|
Total Expenditure |
121699.000 |
113364.100 |
71945.400 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
30.06.2008 1st
Quarter |
30.09.2008 2nd
Quarter |
|
Sales Turnover |
|
29644.300 |
37386.500 |
|
Other Income |
|
1781.700 |
2017.500 |
|
Total Income |
|
31426.000 |
39404.000 |
|
Total Expenditure |
|
26465.600 |
33427.500 |
|
Operating Profit |
|
4960.400 |
58976.500 |
|
Interest |
|
431.300 |
404.800 |
|
Gross Profit |
|
4529.100 |
5571.700 |
|
Depreciation |
|
354.900 |
365.200 |
|
Tax |
|
749.600 |
567.600 |
|
Reported PAT |
|
3579.300 |
4629.300 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
PAT / Total Income |
(%) |
7.17
|
6.52 |
6.49 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
8.72
|
7.72 |
9.05 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
18.01
|
14.98 |
12.61 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.08
|
0.20 |
0.16 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.38
|
0.95 |
0.89 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
2.55
|
3.02 |
2.22 |
LOCAL AGENCY
FURTHER INFORMATION
HISTORY
Subject is a producer of copper in India came into business track in 8th September of the year 1975 as Rainbow Investments Limited. Company part of Vedanta Resources a London listed metals and mining major with Aluminium, Copper and Zinc operations in India and Australia, continues to seek improvements in its business, having set benchmarks to LME grade A standards in Copper products manufacturing. The notable thing is, SIIL is the first private sector smelter in India and also an ISO 9001:2000, ISO 14001 and OHSAS 18001 Certified Organization. The Company's main products, Copper Cathodes and Copper Rods meet global quality benchmarks. The operations of the company are Mining, Smelting and Refining.
The Company undertook the manufacture of cables, conductors and enamelled
copper wires at its factories in Mumbai and Pune and the company's name was
changed from Rainbow Investments Limited to Sterlite Cables Limited in 19th
October of the year 1976. On 28th February of the year 1986, again the name of
the Company was changed to the present name subject. The Company undertook a
project to set up a continuous cost and rolled non-ferrous rods unit at Taxwe
Khurd near Lonawala with the technical assistance of M/s. Continuus, SpA, Italy
and M/s. La Farga Lacambra Sa, Spain. The unit was commissioned during 1989-90.
In 1989, the Vision Finance & Leasing Limited was became a wholly owned
subsidiary of the Company. The Company's XLPE Cable Unit and PVC insulated
Power and Control cable unit were modernised with the technical assistance of
Johan Royle & Sons, U.S.A and integrated backwards into the manufacture of
copper rods. The Company diversified its activities in the year 1990 by
undertook the manufacture of Jelly-filled telecommunication cables (JFTC) with
an installed capacity of 0.625 Millions CKM.
Company had set up an additional plant for manufacture of Jelly filled cables
with an installed capacity of 1.500 Millions CKM in the year 1992 and also set
up a new plant with an annual capacity of 40,000 FKM at Aurangabad to
manufacture fibre optic cables. In 1993, SIIL commissioned a new plant at
Silvassa for manufacture of Jelly filled cables with an installed capacity of
2.000 Millions CKM. Commissioned a smelter in Tuticorin and a refinery in
Silvassa in the year 1995. Sterlite communications limited was merged with the
company in 1st April of the year 1996. The technical collaboration and
technology license agreement was signed with Aluminium Pechiney (AP), France during
the year1997 for the latest AP 30 technology. A plant was set up in the year
1998 as a downstream facility that would make use of the sulphuric acid
produced by Sterlite's copper smelter plant. The Company and telecom
multinational Alcatel had joined hands in the year of 2000 to provide telecom
networking solutions in India. Pursuant to the Scheme of Arrangement, the
telecommunication business of the company has been demerged into a separate
company as Sterlite Optical Technologies Limited with effect from July 2001 and
in the same year the SIIL hive off is power transmission the aluminium
conductor division into a wholly owned subsidiary of the company. The Company,
Indo Gulf Industries and SWIL Limited has jointly promoted the copper
consumption in the country through increased use of the metal in new areas such
as motors, house-wiring, electricity transformers and plumbing. In the same
year 2001, SIIL acquired the BALCO.
During the year 2002, the company Acquired Hindustan Zinc Limited and in 2003, Sterlite,
Essar and Videocon have tied up the confidential memorandum to buy the
government’s stake in SCI. During the year 2004, the company inks deal with
Escondida mine. Company bagged National Award for Excellence in Energy
Management for 2005 from the Confederation of Indian Industries (CII). In 2005,
company commissioned 300 ktpa smelter and refinery in Tuticorin. In 2006, the
company completed major expansions like 1,20,000 tpa of copper smelting,
1,20,000 tpa of copper refinery and 90,000 tpa of the copper rod plant,
following which its annual smelting capacity increased to 3,00,000 tonnes. The
Chinchpada unit upgraded from ISO 14001:1996 to ISO 14001:2004 standards' the
unit was also certified for ISO 9001: 2000 and OHSAS18001: 1999 in the same year
2006.
The company successfully completed an American Depositary Share issue of $2
billion during the year 2007 and listed in New York Stock Exchange. The company
currently engaged in construction of a 170,000 tpa smelter in Chanderiya and
debottlenecking initiatives for 88,000 tpa capacity in Chanderiya and Debari.
During the year 2007, the company received Commendation Certificate by the
Confederation of Indian Industry (CII) for large business organisations for its
sustainable development, 'Golden Peacock National Training Award' for the year
2007from Institute of Directors and Qual Tech award 2007 for Innovation
category from Qimpro, Mumbai, apart from this, SIIL bagged numerous awards
during the same year 2007.
As on January 2008, Company has received the prestigious Golden Peacock Award
for Training in recognition of its employee training structure and other
outstanding practices and in May 2008, the company and ASARCO LLC ('Asarco')
have signed a definitive agreement for the acquisition of operating assets of
Asarco for 2.6 billion dollars in cash.
FINANCIALS
– Rs.284380.000 Millions. Consolidated revenue for 2007-08
– Rs.94340.000 Millions EBITDA for 2007-08
– Rs.62740.000 Million PAT for 2007-08
– Rs.651.900 Millions Consolidated EPS for 2007-08
MR ANIL AGARWAL
Mr. Agarwal, 55,
who founded the Vedanta/ Sterlite group in 1976, is our Chairman and was
appointed to the Board of Directors in 1978. He is also the Executive Chairman
of Vedanta Resources Plc and the Director of
- Bharat Aluminium Company Limited
- Hindustan Zinc Limited
- Sterlite Technologies Limited
- Sterlite Opportunities and Ventures
Limited
- Sterlite Energy Limited
- Vedanta Aluminium Limited
- Copper Mines of Tasmania
- Talanga Copper Mines
- Vedanta Resources Holding Limited
- Finsider International Company Limited
- Sterlite Paper Limited
Mr. Agarwal was
previously the Chairman, Managing Director and CEO from 1980 until his term
ended in October 2004. He has over 30 years of experience as an industrialist
and has been instrumental in our growth and development since the inception.
MR NAVIN AGARWAL
Mr. Navin Agarwal,
47, Executive Vice- Chairman, was appointed to our Board of Directors in August
2003. His responsibilities include executing the business strategy and
monitoring the overall performance and growth of the organisation. Mr. Agarwal
has been with the Company since its inception. He is also the Chairman of
Konkola Copper Mines and The Madras Aluminium Company Limited, Deputy Executive
Chairman of Vedanta Resources Plc and Director of
- Bharat Aluminium Company Limited
- Hindustan Zinc Limited
- Vedanta Aluminium Limited
- The Madras Aluminium Company Limited
- Sterlite Technologies Limited Sterlite
Paper Limited
- Sterlite Iron and Steel Company Limited
- Sterlite Infrastructure Private Limited
- Sterlite Infrastructure Holdings
Private Limited
- Sterlite Energy Limited
- Finsider International Company Limited
- Sterlite Shipping Ventures Private
Limited
Mr. Navin Agarwal
has over 20 years of experience in strategic management. He holds a Bachelor of
Commerce degree from Sydenham College, Mumbai, and has also completed the
Owner/ President Management Program at Harvard University.
MR KULDIP KUMAR
KAURA
Mr. Kaura, 61, our
Managing Director and CEO was appointed to our Board of Directors in October
2004. He is also the CEO of Vedanta Resources Plc and the Vice-Chairman and
Chief Executive Officer of Konkola Copper Mines. Further, he is also on the
board of
- Hindustan Zinc Limited
- Vedanta Aluminium Limited
- Copper Mines of Tasmania
- Sterlite Energy Limited
- Thalanga Copper Mines Pty Limited
- Sesa Goa Limited
Mr. Kaura was the
Managing Director of HZL from April 2002 to March 2004, the COO of Vedanta from
December 2003 to March 2005 and the CEO of Vedanta from March 2005 to date.
Prior to that, Mr. Kaura served at ABB India as Managing Director and Country
manager from 1998 to 2002. He has a Bachelor of Engineering degree from BITS,
Pilani.
MR TARUN JAIN
Mr. Jain, 48, is
the Whole Time Director and was appointed to the Board of Directors in November
2004. He is also a Director of
- Bharat Aluminium Company Limited
- Hindustan Zinc Limited
- Vedanta Aluminium Limited
- Sterlite Opportunities and Ventures
Limited
- Twin Star Holdings Limited
- The Madras Aluminium Company Limited
- Westglobe Limited
- Sterlite Shipping Ventures Private
Limited
- Sterlite (USA) Inc., USA
He joined the
Company in 1984 and has over 20 years of experience in corporate finance, accounts,
audit, taxation and secretarial practice. He is responsible for the strategic
financial matters including finance and accounting, legal and regulatory
compliance and risk management. Mr. Jain is a graduate of the Institute of Cost
and Works Accountants of India and a Fellow Member of the Institute of
Chartered Accountants of India and the Institute of Company Secretaries of
India.
MR DWARKA PRASAD
AGARWAL
Mr. Agarwal, 76,
is one of the Non-executive Directors and was appointed to the Board of Directors
in 1976. He is a trustee of the Sterlite Foundation, which is a social and
charitable organization and a Director of Anil Agarwal Foundation Trust, a
non-profit organisation. He has contributed significantly to the development
since the inception. Mr. Agarwal is also a Director of
- Volcan Investment Limited
- Nagreeka Exports Limited
- Twin Star Investments Limited
- Twin Star Infrastructure Limited
- Twin Star Overseas Limited
- Sterlite Paper Limited
- Sterlite Iron and Steel Company Limited
MR ISHWARLAL PATWARI
Mr. Patwari, 76,
is the Non-executive Director and was appointed to the Board of Directors in
November 1976. He has over 45 years of experience as an industrialist and is a
Fellow Member of the Institute of Chartered Accountants of India. He has been
the Chairman of Nagreeka Exports Limited for the last six years and is also
Director of Nagreeka Capital & Infrastructure Limited.
MR GAUTAM BHAILAL
DOSHI
Mr. Doshi, 55, is
an Independent Nonexecutive Director and was appointed to of the Board of Directors
in December 2001. Since August 2005, he has been employed with Reliance ADA
Group Private Limited. Before that, he was a partner of RSM & Co. in India
from September 1997 to July 2005. Mr. Doshi has 24 years of experience in
audit, finance and accounting. Mr. Doshi is a Fellow Member of the Institute of
Chartered Accountants of India and was a member of the Central Council and the
Western India Regional Council of the Institute of Chartered Accountants of
India. He is also Director of
- Reliance Communication Infrastructure
Limited
- Reliance ADA Group Limited
- Reliance Life Insurance Company Limited
- Reliance Asset Reconstruction Company
Limited
- Reliance Telecom Limited
- Adlabs Films Limited
- Garware Polyester Limited
- Piramal Life Sciences Limited
- Connect Capital Private Limited
- Telecom Infrastructure Finance Private
Limited
- Medi Assist India Private Limited
- Sonata Investments Limited
MR BERJIS MINOO
DESAI
Mr. Desai, 51, is
a Non-executive Director and was appointed to the Board of Directors in January
2003. He holds a Masters Degree in law from the University of Cambridge and has
been the managing partner of Messrs J. Sagar Associates since 2003. His
expertise lies in laws relating to mergers and acquisitions, securities,
international commercial arbitration and in financial and international
business law. Before 2003, he was a partner at Messrs Udwadia, Udeshi &
Berjis. He is a Director of several companies including Reliance Asset
Reconstruction Company Limited
- JSA Law Limited
- JSA Lex Holdings Limited
- The Great Eastern Shipping
- Company Limited
- Praj Industries Limited
- Emcure Pharmaceuticals Limited
- Centrum Capital Limited
- Bio Energy Europa, B.V
- Praj Schneider Inc
- Kotak Mahindra Trusteeship
- Services Limited
- Greatship (India) Limited
- Nocil Limited
- Wockhardt Hospitals Limited
- IRB Infrastructure Developers Limited
- Deepak Nitrite Limited
- Inventurus Knowledge Solutions Private
Limited
- Isagro (Asia) Agrochemicals Private
Limited
- Centrum Fiscal Private Limited
- Capricorn Studfarm Private Limited
- Capricorn Agrifarms & Developers
Private Limited
- Capricorn Plaza Private Limited
- Equine Bloodstock Private Limited
- Jakari Express Private Limited
- Jakari Holdings Private Limited
- Sabro Capital Investment Advisors
Private Limited
MR SANDEEP H.
JUNNARKAR
Mr. Junnarkar, 56,
is the Non-executive Director and was appointed to the Board of Directors in
June 2001. He is a solicitor and a partner of Messrs Junnarkar &
Associates. Earlier, he was a partner at Messrs Kanga & Co. from 1981 to
2002. Mr. Junnarkar specializes in banking and corporate law. He has a Bachelor
of Science (Honours) degree followed by a Bachelor of Law degree, both from the
University of Mumbai and is a member of the Bombay Incorporated Law Society.
Mr. Junnarkar is also a Nonexecutive and Independent Director of
- Everest Industries Limited
- Excel Crop Care Limited
- Jai Corp Limited
- Sunshield Chemicals Limited
- Tilaknagar Industries Limited
- Reliance Industrial Infrastructure
Limited
- Reliance Utilities Limited
- Reliance Industrial Investments & Holdings
Limited
- Reliance Ports and Terminals Limited
- IL&FS Infrastructure Development
Corporation Limited
FINANCIAL REVIEW
The gross turnover
of the Company increased by 8% from Rs.124580.000 Millions to Rs.134520.000
Millions. The EBITDA for the same period increased from Rs.13650.000 Millions
to Rs.14600.000 Millions representing an increase of 7%. The net profit
increased by 21% from Rs.7840.000 Millions to Rs.9520.000 Millions. The
increase in revenues can primarily be attributed to 8% increase in Copper sales
to 337,073 MT from 311,148 MT; 27% increase in Sulphuric Acid sales to 614,098
MT from 483,018 MT. LME prices also showed a substantial increase with average
LME for the year being US$7,588 per MT compared to US$6,861 MT during the
previous year.
OPERATIONAL REVIEW
They produced
339,294 MT of cathodes, an increase of 8% from the previous year of 312,720 MT.
They also produced 224,758 MT of copper rods, an increase of 26% from the
previous year production of 177,882 MT. The production of sulphuric acid
increased by 9% from 946,539 MT to 1,027,771 MT. During the year, the Company
consolidated its leadership position in domestic copper with record sales of
125,588 MT of copper with a market share of 29% in the primary market. The
Company also exported 180,035 MT of copper (previous year 194,625 MT). Exports
included 99,275 MT of copper rods (82,603 MT in the previous year). Malaysia,
Saudi Arabia, Thailand, China and Singapore are the key markets and they
continue to develop a larger customer base for the export of copper rods.
SUBSIDIARY
COMPANIES
Fujairah Gold FZE,
UAE became a subsidiary of the Company during the year. Including this, the
Company had nine subsidiary companies as on 31 March 2008. The shareholders may
refer to the statement under Section 212 of the Companies Act, 1956 and
information on the financial statements of subsidiaries appended to the above
Statement under Section 212 of the Companies Act, 1956 in this Annual Report
for further information on these subsidiaries.
The Ministry of
Corporate Affairs vide its letter No. 47/167/2008 – CL - III dated 18th June
2008 granted approval to your Company for not attaching the financial
statements of subsidiary companies to the financials of the Company for
2007-08. Members may write to Company Secretary at Subject, SIPCOT Industrial
Complex, Madurai-Bypass Road, Tuticorin – 628 002 to obtain a copy of the
financial statements of the subsidiary companies.
RECENT DEVELOPMENT
On 30 May, 2008, your
Company and ASARCO LLC, or Asarco, a mining, smelting and refining Company
based in Tucson, Arizona, United States of America, signed a definitive
agreement for the Company to acquire substantially all the operating assets of
Asarco for $2.6 billion in cash following an auction process. The agreement is
subject to the approval of the US Bankruptcy Court for the Southern District of
Texas, Corpus Christi Division.
GROUP STRUCTURE
The Agarwal Group,
being a “group” defined under the Monopolies and Restrictive Trade Practices
Act, 1969, (MRTP Act) controls the Company. The names of companies and persons
comprising the Agarwal Group, have been disclosed in the Annual Report of the
Company for the purpose of Regulation 3(1)(e) of the SEBI (Substantial Acquisition
of Shares and Takeover) Regulations, 1997.
Fixed
Assets:
- Land
- Building
- Building (Lease hold)
- Plant and Machinery
- Furniture and Fixture
- Data Processing Equipments
- Office Equipments
- Electrical Fittings
- Vehicles
- Technical know how
Website
Details:
Subject is the principal subsidiary of the
Vedanta Resources Group. It was the first company in India to set up a Copper
Smelter and Refinery in Private Sector and operate the largest capacity
continuous Cast Copper Rod plants. SIIL’s main products, Copper Cathodes and
Copper Rods meet global quality benchmarks.
Subject’s performance makes it one of the fastest-growing companies with
sales increasing from Rs.9220 million (US$ 217 Mn) in 1997-98 to Rs.67,921
million (US$ 1,527 Mn) in 2005 - 2006, recording a CAGR of 28%.
Subject’s consistent product quality and high standard of customer
service has earned it an enviable 43% share in the domestic market by volume in
2005 - 06. The hallmark of its success has been the stress on quality and
constant benchmarking with the best in the world, giving it the distinction of
being a low-cost, high quality, high-efficiency producer by global standards.
Subject places a very strong emphasis on the
following:
People
At SIIL, people are its major strength, helping transform the SIIL
vision into reality. Attracting, nurturing and retaining the best and the
brightest are the cornerstone of its HR policy.
State-of-the-art-Technology
Subject constantly endeavours to keep ahead of the Technology curve. Constantly
investing in the latest in Technology and Innovation, SIIL facilities are
comparable with the best in the world.
Environmental Consciousness
As part of its growth, SIIL will focus on environment protection. Investing in
environment friendly technology, SIIL has carried out extensive work including
setting up a 5000 cubic meters capacity Rainwater Harvesting System and
extending the Green Belt around its facilities extensively.
Social Consciousness
Subject operates with a Social Consciousness. There are several initiatives
undertaken to give back to society. SIIL takes its role as a Responsible
Corporate Citizen very seriously.
Growth
Growth is a way of life at SIIL. This is visible in the achievements over the
last 5 years. SIIL has gone from strength to strength and continues to look for
new opportunities to achieve returns and active growth.
Mines
Subject
owns two mines which together supplied 127,196 tons of concentrate in 2005 -
06. However, one of its mines has closed since July 2005.
Smelter
The
Smelter at Tuticorin, Tamilnadu is based on a proven energy efficient and
environment friendly technology, IsaProcess™ from MIM, Australia.
Refinery
The
anode produced by the smelter is processed in the Refinery at Dadra Nagar
Haveli, Silvassa using IsaProcess™ sourced from MIM, Australia. The copper
cathodes produced are LME ‘A’ grade certified. A new refinery also using the
IsaProcess™ is being added at Tuticorin for scaling up operations.
Copper Rods Plant
State-of-the-art
continuous cast copper rod plant based on technology and equipment from
Continuous Properzi, Italy produces continuously cast copper rods, meeting
stringent quality and performance standards.
Sulphuric Acid Plant
The
Sulphuric Acid Plant, with designed capacity to produce 1,068,000 tonnes of
Sulphuric acid per annum, is set up with basic engineering from Kvaerner
Chemetics, Canada.
Phosphoric Acid Plant
The
phosphoric acid plant with HDH process has a production capacity of 180,000
tonnes per annum. Technology and basic engineering for this plant has been
sourced from Hydro Agri International, UK.
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.47.28 |
|
UK Pound |
1 |
Rs.73.43 |
|
Euro |
1 |
Rs.68.22 |
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 |
7 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
6 |
|
--LEVERAGE |
1~10 |
6 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
6 |
|
--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 & 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 |
|