MIRA
INFORM REPORT
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Report Date : |
22.12.2008 |
IDENTIFICATION
DETAILS
|
Name : |
HIRAN ORGOCHEM
LIMITED |
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Registered Office : |
Palm Court, M Block,
601/A1, Link Road, Malad [West], Mumbai – 400064, Maharashtra |
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Country : |
India |
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Financials (as on) : |
31.03.2008 |
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Date of Incorporation : |
22.03.1983 |
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Com. Reg. No.: |
11-29596 |
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CIN No.: [Company
Identification No.] |
U51900MH1983PLC029596 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
MUMH06992G |
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PAN No.: [Permanent
Account No.] |
AAACH0977J |
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Legal Form : |
A public limited liability
company; The company’s shares are listed on the stock exchange. |
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Line of Business : |
Manufacturer,
Importer and Exporter of
Ciprofloxacian Hydrochloride |
RATING &
COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Maximum Credit Limit : |
USD 5000000 |
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Status : |
Satisfactory |
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Payment Behaviour : |
Slow |
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Litigation : |
Clear |
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Comments : |
Subject is a well established company having satisfactory track. Trade
relations are fair. Payments are reported as slow but correct. The company can be considered normal for business dealings at usual trade
terms and conditions. |
LOCATIONS
|
Registered
Office : |
Palm Court, M
Block, 601/A1, Link Road, Malad [West], Mumbai – 400064, Maharashtra, India |
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Tel. No.: |
91-22-40953000 |
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Fax No.: |
91-22-40953099 |
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E-Mail : |
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Website : |
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Factory : |
Plot No. 663, GIDC Panoli, Ankleshwar, Bharuch – 394116, Gujarat, India |
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Factory : |
Plot No. 322/B, GIDC Panoli, Ankleshwar, Bharuch – 394116, Gujarat, India |
DIRECTORS
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Name : |
Mr. Kantilal M.
Hiran |
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Designation : |
Chairman And Managing
Director |
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Qualification
: |
Matriculation |
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Name : |
Mr. Vijay Hiran |
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Designation : |
Whole Time
Director |
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Qualification
: |
Post Graduate,
Diploma in Foreign Trade |
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Name : |
Mr. M. Kailash
Kumar |
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Designation : |
Director |
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Name : |
Mr. H.N. Bafna |
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Designation : |
Director |
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Name : |
Mr. Uttamchand
Hiran |
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Designation : |
Director |
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Date of Ceasing : |
28.08.2007 |
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Name : |
Mr. Mukesh Naik |
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Designation : |
Director |
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Age : |
53 years |
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Qualification
: |
Bachelor of
Chemical Engineer |
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Name : |
Mr. Ashok A. Lunia |
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Designation : |
Additional Director |
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Age : |
50 years |
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Qualification
: |
M.Com |
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Experience : |
Worked as an Income Tax Practitioner for the past 25 years. |
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Name of the other Companies in which also
holds Directorship : |
A.C.Securities and Services (P) Limited Coimbatore Stock Exchange Limited |
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Date of Appointment : |
28.08.2007 |
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Name : |
Mr. V.P.Shah |
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Designation : |
Director |
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Name : |
Mr. S.P.Tated |
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Designation : |
Whole time director |
SHAREHOLDING
PATTERN
AS ON 31.03.2008
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
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Promoter Holding
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Indian Promoters |
4756600 |
45.30 |
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Non – Promoter
Holding |
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Institutional Investors |
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FIIs |
519858 |
4.95 |
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Others |
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Private Corporate Bodies |
639653 |
6.09 |
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Indian Public |
4563474 |
43.46 |
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NRIs / OCBs |
10780 |
0.10 |
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Any Other [Clearing Members] |
10235 |
0.10 |
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Total |
10500600 |
100.00 |
BUSINESS DETAILS
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Line of Business : |
Manufacturer,
Importer and Exporter of
Ciprofloxacian Hydrochloride |
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Products : |
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PRODUCTION STATUS
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Particulars |
Unit |
Installed
Capacity |
Actual
Production |
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Bulk Drugs |
Kgs |
640000 |
53025 |
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Reprocessing of
Bulk Drugs |
Kgs |
-- |
15480 |
GENERAL
INFORMATION
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No. of Employees : |
250 |
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Bankers : |
State Bank of
India |
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Facilities : |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
B. L. Dasharda
And Associates Chartered
Accountants |
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Associates/Subsidiaries : |
Ř Sunflower Trading And Investments Private
Limited |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
1,50,00,000 |
Equity Shares |
Rs. 10/- Each |
Rs. 150.000 Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
1,05,00,600 |
Equity Shares |
Rs. 10/- Each |
Rs. 105.006
Millions |
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
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SHAREHOLDERS FUNDS |
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|
|
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1] Share Capital |
105.006 |
105.006 |
77.240 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
769.552 |
736.868 |
393.420 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
874.558 |
841.874 |
470.660 |
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LOAN FUNDS |
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1] Secured Loans |
544.861 |
436.576 |
297.607 |
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2] Unsecured Loans |
21.775 |
42.275 |
29.900 |
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TOTAL BORROWING |
566.636 |
478.851 |
327.507 |
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DEFERRED TAX LIABILITIES |
40.230 |
35.413 |
25.705 |
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TOTAL |
1481.424 |
1356.138 |
823.872 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
359.537 |
316.779 |
275.616 |
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Capital work-in-progress |
22.642 |
5.702 |
12.205 |
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INVESTMENT |
8.879 |
7.823 |
15.208 |
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DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
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CURRENT ASSETS, LOANS & ADVANCES |
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Inventories |
682.341
|
626.761 |
430.384
|
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Sundry Debtors |
291.157
|
172.777 |
196.622
|
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Cash & Bank Balances |
44.596
|
45.864 |
29.901
|
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Other Current Assets |
0.000
|
0.000 |
0.000
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Loans & Advances |
606.198
|
587.462 |
235.794
|
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Total
Current Assets |
1624.292
|
1432.864 |
892.701 |
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Less : CURRENT
LIABILITIES & PROVISIONS |
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Current Liabilities |
505.204
|
323.366 |
286.087
|
|
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Provisions |
29.598
|
84.717 |
86.358
|
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Total
Current Liabilities |
534.802
|
408.083 |
372.445 |
|
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Net Current Assets |
1089.490
|
1024.781 |
520.256
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MISCELLANEOUS EXPENSES |
0.876 |
1.053 |
0.587 |
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TOTAL |
1481.424 |
1356.138 |
823.872 |
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PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
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Sales Turnover |
1190.507 |
1105.263 |
1151.358 |
|
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Other Income |
26.800 |
17.520 |
11.087 |
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Total Income |
1217.307 |
1122.783 |
1162.445 |
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Profit/(Loss) Before Tax |
49.773 |
26.772 |
203.259 |
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Provision for Taxation |
10.948 |
16.007 |
69.443 |
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Profit/(Loss) After Tax |
38.825 |
10.765 |
133.816 |
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Earnings in Foreign Currency : |
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Total Earnings |
NA |
112.858 |
240.399 |
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Imports : |
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Raw Materials |
NA |
278.934 |
353.857 |
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Capital Goods |
NA |
0.352 |
3.424 |
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Total Imports |
NA |
279.286 |
357.281 |
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Expenditures : |
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|
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Manufacturing and Project Expenses |
46.124 |
1029.133 |
965.276 |
|
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Sales Tax and Other Taxes |
0.000 |
26.442 |
24.164 |
|
|
Power, Fuel and Water Charges |
42.698 |
41.619 |
42.803 |
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Employees Remuneration and Benefits |
34.945 |
31.795 |
29.111 |
|
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Directors Remuneration |
3.503 |
2.754 |
2.350 |
|
|
Increase/(Decrease) in Finished Goods |
22.649 |
[155.140] |
[206.085] |
|
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Other Operative and Administrative Expenses |
918.771 |
45.273 |
38.103 |
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Selling Expenses |
12.502 |
11.551 |
16.797 |
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Interest and Finance Charges |
68.016 |
46.352 |
34.028 |
|
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Depreciation & Amortization |
18.326 |
16.234 |
12.638 |
|
Total Expenditure |
1167.534 |
1096.013 |
959.185 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
30.06.2008 |
30.09.2008 |
|
Type |
|
1st
Quarter |
2nd
Quarter |
|
Sales Turnover |
|
410.400 |
479.200 |
|
Other Income |
|
06.100 |
03.000 |
|
Total Income |
|
416.500 |
482.200 |
|
Total Expenditure |
|
381.900 |
450.000 |
|
Operating Profit |
|
34.600 |
32.200 |
|
Interest |
|
18.400 |
24.600 |
|
Gross Profit |
|
16.200 |
07.600 |
|
Depreciation |
|
05.300 |
05.300 |
|
Tax |
|
03.200 |
00.900 |
|
Reported PAT |
|
07.700 |
01.400 |
KEY RATIOS
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
Debt-Equity Ratio |
0.61 |
0.61 |
0.85 |
|
Long Term Debt-Equity Ratio |
0.10 |
0.17 |
0.32 |
|
Current Ratio |
1.62 |
1.63 |
1.31 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
3.11 |
3.35 |
4.46 |
|
Inventory |
1.95 |
2.23 |
3.86 |
|
Debtors |
5.51 |
6.39 |
8.43 |
|
Interest Cover Ratio |
1.66 |
1.52 |
6.62 |
|
Operating Profit Margin(%) |
11.25 |
8.04 |
20.72 |
|
Profit Before Interest And Tax Margin(%) |
9.82 |
6.67 |
19.68 |
|
Cash Profit Margin(%) |
4.47 |
2.29 |
12.03 |
|
Adjusted Net Profit Margin(%) |
3.04 |
0.92 |
11.00 |
|
Return On Capital Employed(%) |
9.09 |
7.43 |
41.37 |
|
Return On Net Worth(%) |
4.52 |
1.65 |
42.77 |
LOCAL AGENCY
FURTHER INFORMATION
History
Subject Company is the Mumbai based company, is into
manufacture of bulk drugs like Ciprofloxacian, Hydrochloride -USP. The company's
plant at Panoli has an installed capacity of 240000 KGS.
Performance:
During the year, the Company achieved sales of Rs. 1278.022 millions compared
to Rs. 1154.129 millions for the previous financial year registering a growth
of more than 10%. The margin of the Company also improved due to higher sales
volume. The Company earned Net Profit before Tax of Rs. 49.774 millions as
against Rs. 26.772 millions for the previous financial year. The Profit after
Tax for the year under review stood at Rs.38.826 millions against Rs. 10.765
millions of the previous year.
MANAGEMENT DISCUSSION
AND ANALYSIS
a. Industry structure and
developments:
The demand for bulk drugs is expected to increase considering the growth of
user industries viz. Pharmaceutical
Formulating Companies.
b. Opportunities and
threats:
The Company's opportunities lie in the adequate demand for the Ciprofloxacin in
the Bulk Drug segment. Pharmaceutical is a growing industry, immune to economic
recession and commodity cycles. Rising population, new disease incidence or
resurgence of certain diseases spur the growth. Ciprofloxacin enjoys a good
demand all over the world due to its effectiveness in curing wide range of
infections without any side effects. Going by the hygiene standards prevailing
in the country and the outbreak of floods, storms, there is vast
potential/market for the product.
The Company may face tough competition from other players in the industry.
Threat is perceived from China in case they start dumping Ciprofloxacin in the
Indian Market. However, they understand that the purity of the Chinese product
is not of high standard and as such China will find it difficult to enter the
Cipro market.
c. Segment-wise or product-wise
performance:
The Company has only one business segment i.e. Bulk Drugs. The figures of
production and sales for the Bulk Drugs are furnished in the Notes to
Accounts.
d. Outlook:
The Company is proactively responding to the changing business environment and
is confident of sustaining its market share by improving competitive position
in the market. The overall business outlook for the Company is promising with
improvement in overall economic environment. Efforts towards higher operational
efficiencies shall continue. The Company continues to examine the possibilities
of expansion and will make the necessary investments when attractive
opportunities arise.
Preferential
Allotment of Equity Shares and Optionally Fully Convertible Warrants
(OFCWs):
The Board of Directors of the Company had at their meeting held on 14th
February, 2007, allotted - (i) 9,10,000 Equity Shares of Rs. 10/- each fully
paid-up for cash at a premium of Rs. 120/- per share and (ii) 16,75,000
Optionally Fully Convertible Warrants (OFCWs) (Warrants), each Warrant
convertible at the sole option of the holder thereof, any time on or after 1st
April, 2007 but before expiry of 18 months from the date of allotment thereof,
into 1 fully paid up equity share of the Company of face value of Rs. 10/- each
at an exercise price (including premium) of Rs.130/- per warrant forming part
of the Preferential Issue made by the Company pursuant to the Special
Resolution under Section 81 (1A) of the Companies Act, 1956, passed at the
Extra-ordinary General Meeting of the Company held on 30th January, 2007. The
said shares have been listed on Bombay Stock Exchange Limited (BSE) with effect
from 21st May, 2007.
Preferential Allotment of Equity Shares
on conversion of Optionally Fully Convertible Warrants (OFCWs):
The Company had allotted 23,00,000 Optionally Fully Convertible Warrants
(OFCWs) (Warrants) on 23rd September, 2005 pursuant to the special resolution
passed by the members of the Company at the Extra-ordinary General meeting held
on 9th September, 2005. The Board of Directors of the Company at their meeting
held on 21st March, 2007 allotted 18,66,600 equity shares of face value of Rs.
10/- per share on conversion of 18,66,600 Optionally Fully Convertible Warrants
(OFCWs) at an exercise price (including premium) of Rs. 130/- per warrant in
first and final tranche to those holders who exercised their option of
conversion. The Company is in the process of listing the said equity shares
with BSE.
Outlook:
The Company is pro-actively responding to the changing business environment and
is confident of sustaining its market share by improving competitive position
in the market. The overall business outlook for the Company is promising with
improvement in overall economic environment. Efforts towards higher operational
efficiencies shall continue. The Company continues to examine the possibilities
of expansion and will make the necessary investments when attractive
opportunities arise.
Shifting of Registered Office of the
Company:
The Registered Office of the Company has been shifted to 'Palm Court, M Block,
601 / A1, Link Road, Malad (West), Mumbai - 400 064' w.e.f. 11th May,
2007.
Fixed Assets
v
Leased Hold
v
Plant and
Machinery
v
Factory
Building
v
Office Premises
v
Electrical
Installations
v
Vehicles
v
Office
Equipment
v
Computer
v
Air
Conditioners
v
Furniture and
Fixture
v
Lab
Equipment
AS PER
WEBSITE DETAILS
Profile
Subject
is a Medium sized
Public Limited Company founded in 1983, manufacturing Pharmaceutical Bulk
Actives. Subject has grown to be one of the most successful and Largest Dedicated Manufacture of Bulk Actives
in the pharmaceutical Industry.
The Company has achieved
this postion due to its Strong
Commitment, Delivering
Unparalleled Excellence in customer
service.
Subject
providing
customers with Quality Products
and has a well-equipped Quality Control Department. Each and every batch
undergoes strict quality check by expert and quality staff in Quality Control
Department.
Subject
Provides services
on a quick-turn, cost-effective basis has successfully expanded its customer
base, and delivered solid operating returns.
The global Pharmaceutical
Market is projected to grow 25 percent over the next year - providing Hiran
with a large and growing target market. Hiran is one of the few companies to meet the Pharmaceutical Industry
market's demand.
Subject
offers a
vertically integrated approach towards Dedicated Manufacturing, thereby
enabling the Company to exercise greater control.
Subject's strong operating performance
combined with its exceptional balance sheet provides long-term stability for the Customers, Suppliers and
Employees.
Product
Finished
Formulation: -
Ciprofloxacin HCL
250 MG.
Ciprofloxacin HCL
500 MG.
Ciprofloxacin HCL (500
MG) + Tinidazole (600 MG)
Ciprofloxacin HCL
Ciprofloxacin
Hydrochloride
Ciprofloxacin Base
Ciprofloxacin
Lactate
Enrofloxacin
Hydrochloride
Enrofloxacin Base
Enrofloxacin
Lactate
Danofloxacin
Difloxacin
Hydrochloride
Difloxacin Base
Difloxacin Lactate
Sarafloxacin HCL
Sarafloxacin Base
Sarafloxacin
Lactate
Ofloxacin Base
Levofloxacin
Hemihydrate.
Quality
Subject has a
well-equipped quality control department and is dedicated in manufacturing quality
products and each and every batch undergoes strict quality check by expert and
quality staff.
Subject
the emphasis for the
quality comes from the management and is implemented by the complete production
team. Quality control starts with the rigorous inspection and testing of all
the raw materials for all the parameters. During process quality of all
intermediates is tested at every step of the process apart from the stringent
testing of the final product as per the in-house specifications
At Hiran Orgochem they are continuouslt working on process
development of various products and the main focus is to ensure cost-effective
process and quality . This enable us to fulfill their commitment towards the
valued customers and public.
CMT REPORT
(Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts, India Prisons Service,
Interpol, etc.
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject are
derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE
GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE
RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.47.08 |
|
UK Pound |
1 |
Rs.71.17 |
|
Euro |
1 |
Rs.66.98 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
8 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--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 |
|
63 |
This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING
EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest capability
for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit
consideration. Capability to overcome financial difficulties seems
comparatively below average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
|