MIRA
INFORM REPORT
|
Report Date : |
23.02.2008 |
IDENTIFICATION
DETAILS
|
Name : |
M M FORGINGS LIMITED |
|
|
|
|
Registered Office : |
“Guindy House", 95,Anna Salai, Chennai-600032, Tamil Nadu |
|
|
|
|
Country : |
India |
|
|
|
|
Financials (as on) : |
31.03.2007 |
|
|
|
|
Date of Incorporation : |
21.02.1946 |
|
|
|
|
Com. Reg. No.: |
001473 |
|
|
|
|
CIN No.: [Company
Identification No.] |
L51102TN1946PLC001473 |
|
|
|
|
TAN No.: [Tax
Deduction & Collection Account No.] |
CHET00463B |
|
|
|
|
PAN No.: [Permanent
Account No.] |
AAACM2164L |
|
|
|
|
Legal Form : |
A public limited
liability company. The company’s shares are listed on the Stock Exchanges |
|
|
|
|
Line of Business : |
Manufacturer and Exporter of Steel Forgings. |
RATING &
COMMENTS
|
MIRA’s Rating : |
A |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
56-70 |
A |
Financial & operational base are regarded healthy. General unfavourable
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums |
Fairly Large |
|
Maximum Credit Limit : |
USD 3047124 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a well – established and reputed company having fine track.
Trade relations are fair. Business is active. Payments are reported as
usually correct and as per commitments. The company can be considered good for normal business dealings at
usual trade terms and conditions. |
LOCATIONS
|
Registered Office : |
“Guindy House", 95, Anna Salai, Chennai-600032, Tamil Nadu, India |
|
Tel. No.: |
91-44-22352153 |
|
Fax No.: |
91-44-22352160 |
|
E-Mail : |
|
|
Website : |
http://www.naukri.com |
|
|
|
|
Factory : |
· Singampunari -624 502, Tamil Nadu · Viralimalai – 621 316, Tamil Nadu · A24 / 25 Thiru –vi-ka Industrial Estate, Guindy , Chennai · Karanaithangal Village, Mathur Post – 602 105 · Sriperumbudur Taluk, Kancheepuram District · Panagudi Village, Nagerkoil, Near Muppandal in Tirunelveli District. |
DIRECTORS
|
Name : |
Mr. N Srinivasan |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. V Vaidyanathan |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Vidyashankar Krishnan |
|
Designation : |
Managing Director |
|
|
|
|
Name : |
Mr. K Venkatramanan |
|
Designation : |
Joint Managing Director |
KEY EXECUTIVES
|
Name : |
Mr. V Narayanan |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Mrs. J Sumathi |
|
Designation : |
Company Secretary |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
|
Residents Indians |
2949 |
92.5% |
|
NRIs |
103 |
3.2% |
|
Domestic Company |
99 |
3.1% |
|
Non – Domestic Cos. (FII) |
7 |
0.2% |
|
Financial Institutions / Banks |
1 |
0.0% |
|
Mutual Funds |
7 |
0.22% |
|
Promoters |
21 |
0.66% |
|
Total
|
3187 |
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer and Exporter of Steel Forgings. |
||||||
|
|
|
||||||
|
Products : |
|
PRODUCTION STATUS (as on 31.03.2007);-
|
Particulars |
|
|
Unit |
Installed
Capacity |
|
Steel Forgings |
|
|
Metric Tons |
35000 |
GENERAL
INFORMATION
|
Bankers : |
· State Bank of Tranvancore Mount Road Branch, Chennai – 600 002 · ABN Amro Bank N V 19/1 Haddows Road, Chennai – 600 006 · Citibank Na No. 2 Club House Road, Chennai – 600 002 · State Bank of India 1/65 – A, GST Road, Guindy, Chennai – 600
032 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Banking
Relations : |
Satisfactory |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Facilities: |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Auditors : |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Name : |
G Ramesh Kumar and Company Chartered Accountants |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Address : |
Akila Lands, Ganapathy Colony (South), Thiruvanaikoil, Trichirappalli
– 620 004 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Associates/Subsidiaries : |
Srivatsa Electric and Electronic Limited |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
15000000 |
Equity Shares |
Rs. 10/- each |
Rs.150.000 millions |
Issued Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
6037600 |
Equity Shares |
Rs. 10/- each |
Rs.60.376
millions |
Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
6035200 |
Equity Shares |
Rs. 10/- each |
Rs.60.352
millions |
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
60.352 |
60.352 |
60.400 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
701.429 |
581.783 |
484.300 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
761.781 |
642.135 |
544.700 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
542.059 |
605.400 |
467.300 |
|
|
2] Unsecured Loans |
87.365 |
40.450 |
58.000 |
|
|
TOTAL BORROWING |
629.424 |
645.850 |
525.300 |
|
|
DEFERRED TAX LIABILITIES |
54.696 |
59.196 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
1445.901 |
1347.181 |
1070.000 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
817.593 |
681.115 |
583.400 |
|
|
Capital work-in-progress |
113.784 |
93.648 |
104.800 |
|
|
|
|
|
|
|
|
INVESTMENT |
3.142 |
3.142 |
3.100 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
270.016
|
319.626 |
324.600 |
|
|
Sundry Debtors |
159.745
|
164.982 |
147.200 |
|
|
Cash & Bank Balances |
6.820
|
2.049 |
12.500 |
|
|
Other Current Assets |
0.000
|
0.000 |
0.000 |
|
|
Loans & Advances |
220.845
|
222.011 |
146.600 |
|
Total
Current Assets |
657.426
|
708.668 |
630.900 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
73.760
|
78.315 |
198.200 |
|
|
Provisions |
72.284
|
61.077 |
54.000 |
|
Total
Current Liabilities |
146.044
|
139.392 |
252.200 |
|
|
Net Current Assets |
511.382
|
569.276 |
378.700 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
1445.901 |
1347.181 |
1070.000 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
Sales Turnover |
1764.645 |
1649.629 |
1587.100 |
|
|
Other Income |
56.501 |
42.761 |
39.300 |
|
|
Total Income |
1821.146 |
1692.390 |
1626.400 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
187.529 |
161.628 |
151.400 |
|
|
Provision for Taxation |
46.700 |
43.748 |
33.100 |
|
|
Profit/(Loss) After Tax |
140.829 |
117.880 |
118.300 |
|
|
|
|
|
|
|
|
Export Value |
1028.985 |
880.749 |
0.000 |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Administrative Expenses |
0.000 |
0.000 |
186.600 |
|
|
Raw Material Consumed |
820.872 |
804.369 |
820.500 |
|
|
Excise Duty |
0.000 |
0.000 |
0.100 |
|
|
Increase/(Decrease) in Finished Goods |
0.700 |
[2.118] |
0.000 |
|
|
Salaries, Wages, Bonus, etc. |
18.819 |
13.273 |
84.300 |
|
|
Miscellaneous expenses |
0.000 |
0.000 |
3.300 |
|
|
Tools Consumed |
39.715 |
35.352 |
0.000 |
|
|
Stores consumed |
23.902 |
22.545 |
0.000 |
|
|
Personnel Costs |
122.463 |
104.543 |
0.000 |
|
|
Repair & Maintenance |
51.181 |
45.394 |
0.000 |
|
|
Selling Expenses |
21.018 |
19.287 |
0.000 |
|
|
Export Expenses |
98.863 |
106.234 |
0.000 |
|
|
Interest & Financial charges |
39.200 |
30.845 |
19.300 |
|
|
Power & Fuel |
184.292 |
167.036 |
164.300 |
|
|
Depreciation & Amortization |
167.163 |
141.347 |
142.000 |
|
|
Other Expenditure |
45.521 |
42.022 |
107.500 |
|
Total Expenditure |
1633.709 |
1530.129 |
1527.900 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2007 |
30.09.2007 |
31.12.2007 |
|
Type
|
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
|
Sales Turnover |
423.300 |
458.100 |
481.700 |
|
Other Income |
18.200 |
23.400 |
12.900 |
|
Total Income |
441.500 |
481.500 |
494.600 |
|
Total Expenditure |
339.500 |
371.000 |
390.800 |
|
Operating Profit |
102.000 |
110.500 |
103.800 |
|
Interest |
10.200 |
10.800 |
12.200 |
|
Gross Profit |
91.800 |
99.700 |
91.600 |
|
Depreciation |
45.000 |
45.000 |
45.000 |
|
Tax |
9.500 |
145.000 |
11.500 |
|
Reported PAT |
37.300 |
402.000 |
35.100 |
KEY RATIOS
|
Year |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt-Equity Ratio |
0.91 |
0.99 |
0.73 |
|
Long Term Debt-Equity Ratio |
0.54 |
0.66 |
0.52 |
|
Current Ratio |
1.49 |
1.61 |
1.64 |
|
TURNOVER RATIOS |
|||
|
Fixed Assets |
1.10 |
1.24 |
1.48 |
|
Inventory |
5.99 |
5.12 |
6.51 |
|
Debtors |
10.87 |
10.57 |
13.43 |
|
Interest Cover Ratio |
5.66 |
6.14 |
8.84 |
|
Operating Profit Margin(%) |
22.42 |
20.32 |
19.70 |
|
Profit Before Interest And Tax Margin(%) |
12.95 |
11.75 |
10.76 |
|
Cash Profit Margin(%) |
17.45 |
15.71 |
16.40 |
|
Adjusted Net Profit Margin(%) |
7.98 |
7.15 |
7.45 |
|
Return On Capital Employed(%) |
17.06 |
16.45 |
19.52 |
|
Return On Net Worth(%) |
20.06 |
19.87 |
23.34 |
LOCAL AGENCY
FURTHER INFORMATION
DIRECTOR REPORTS:
OPERATIONS:
SALES:
Sales of the company have increased by 7% over last year.
Export sales of the company have crossed the Rs.1 billion (Rs.1000.000
millions) mark for the first time. Exports at Rs.1058.100 millions account for
60% of sales. The company continues to be one of the largest exporters of steel
forgings from India and has received 17 consecutive Annual Awards from the
Engineering Export Promotion Council.
Foreign Exchange Earnings:
The company is a net foreign exchange earner. Its Exports are substantially higher than its Imports. During the current year the company has earned Rs.857.300 millions in net foreign exchange, which is Rs.187.700 millions more than the previous year.
Quality:
The company has upgraded its Quality Management Systems to TS 16949 standard, which is the latest automotive Quality Systems Standard, while retaining the ISO 9001-2000 certification.
Investments:
· The company is increasing its production capacity from 30,000 MT to 40,000 MT.
· Machining capacity has been substantially increased in line with changing customer demand.
· Adequate forging machines have been added to augment the increase in machining requirement.
· Capital Expenditure during the year was Rs.215.100 millions.
Corporate
Governance:
SEBI guidelines were applicable to the company from the
previous financial year. The company is committed to excellence and ethical
management.
OTHER INFORMATION:
|
Contingent
Liabilities |
31.03.2007 |
31.03.2006 |
|
|
(Rs. in millions) |
|
|
Letter of Guarantee |
1.476 |
3.283 |
|
Letter of Credit |
21.752 |
2.763 |
|
Export Bills discounted |
87.109 |
39.122 |
WEBSITE DETAILS:
The Company was founded in 1946 and the Forging division was established in 1974.
Founded on the Tradition and philosophy of steadfast commitment to achieving "Total Customer Satisfaction" through excellent quality, on time deliveries and competitive pricing, the Company has grown steadily in strength and stature to attain its present recognition of being the largest exporter of Forgings in India in its product range and has created niche in the International Market.
The company has been expanding by adding state of the art forging facilities
and machining forgings to cater to the requirements of its international
customers. Increasingly customers require machined components.
The Company is totally committed to meeting customers' requirement in all respects
and this is reflected in all respects and this is reflected in the Quality
Policy as given below:
PRODUCTION FACILITIES
· Cross Wedge Rolls for producing precision shafts.
· 2500 Ton (3Nos) and 1600 Ton mechanical Presses for producing Forgings consistently with close tolerances.
· 6 Ton Pneumatic Hammer for Producing heavy Forgings upto 40 kg.
· 3 Ton Pneumatic Hammer for producing Forgings upto 15kg.
· 2.5 Ton Pneumatic Hammer for producing Forgings upto 10kg.
· 1.5 Ton Pneumatic Hammer for producing Forgings upto 4kg.
· Battery of 8 Drop Hammers from 0.75 Ton to 2 Ton capacities.
· Knuckle Joint Coining Presses for achieving close tolerances consistently.
· Induction Furnaces for forge billet heating.
· Completely computerised Tool Room linked to 3D CAD workstations for making dies.
· Heat Treatment Facilities for Normalising, Hardening, Tempering and Iso Thermal Annealing.
· Sophisticated facilities for machining of Forgings including Horizontal Machining Centre,Vertical Machining Centre,CNC Lathes, CNC Milling machines, dedicated transfer machining centres,etc...
Projects Under Implementation
Expansion Planned:
· 4000T Mechanical Forging Press
· 2 Nos. 2500T Mechanical Hot Forging Press
· 3T Friction Drop Hammer
· Sealed Quench Furnace Line for precision Heat Treatment
Capacity: 30,000 Tons per annum
Manufacturing Locations:
· Plant 1: Singampunari, Sivagangai District, Tamilnadu
· Plant 2: Viralimalai, Pudukottai District, Tamilnadu
· Plant 4: Karanithangal Village, Padappai, Kancheepuram District
· Plant 5 (Wind Farm): Panagudi Village, Tirunelveli District
Promoter and Business Profile
· Incorporated in 1946 and originally engaged in trading of Royal Enfield Motor Cycles.
· Diversified to manufacture of steel forgings in 1974.
· The core activity then got shifted to manufacture of steel forgings.
· Came out with IPO of 12,20,000 equity shares of Rs.10/- each for cash at a premium of Rs.25/- per share aggregating to Rs.42.7 million in April-May,1994 for expansion project jointly funded by IDBI and ICICI.
· Present equity : Rs.30.176 millions.
· Promoters hold 64.77% of shares on 30,17,600
· Promoters in the active management of the Company hold 50.51%
Quality Certifications
· ISO 9002 cerification obtained in : September,1994
· QS-9000 Certification obtained in : Feb 1999 for forging manufcturing.
· Largest exporter of steel forgings in the Southers Region-Winner of EEPC Award for the past 13 consecutive years.
· Domestic and Export customers are reputed manufacturers all over the world in the fields of Automotive,Valve and Oil Field, Railways and Engineering.
· Certified Export House on basis of export performance from the year 1996-97
· ISO 9002 Certification upgraded to ISO 9001:2000 - the latest version of the quality standard.
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.40.05 |
|
UK Pound |
1 |
Rs.78.75 |
|
Euro |
1 |
Rs.37.32 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
9 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
9 |
|
--LEVERAGE |
1~10 |
9 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
8 |
|
--MARGINS |
-5~5 |
--- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
YES |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
66 |
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 |
|