MIRA
INFORM REPORT
|
Report Date : |
26.02.2008 |
IDENTIFICATION
DETAILS
|
Name : |
PIDILITE
INDUSTRIES LIMITED |
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|
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Registered Office : |
7th
Floor, Regent Chambers, Jamnalal Bajaj Marg, 208, Nariman Point, Mumbai – 400
021, Maharashtra, India |
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Country : |
India |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
28.07.1969 |
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Com. Reg. No.: |
11-14336 |
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CIN No.: [Company
Identification No.] |
L24100MH1969PLC014336 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
MUMP06924B |
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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 : |
Manufacturing and
selling of branded consumer products like adhesives, sealants, art material
and construction paint and chemicals. |
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 19519200 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a
well-established and reputed company having fine track. Available information
indicates high financial responsibility of the company. Financial position is
good. Payments are always correct and as per commitments. The concern can
be considered good for normal business dealings at usual trade terms and
condition |
LOCATIONS
|
Registered
Office : |
7th Floor,
Regent Chambers, Jamnalal Bajaj Marg, 208, Nariman Point, Mumbai – 400 021,
Maharashtra, India |
|
Tel. No.: |
91-22-22822708/28367085/7089 |
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Fax No.: |
91-22-22043969 |
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E-Mail : |
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Website : |
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Corporate
Office: |
Ramkrishna Mandir
Road, Office Mathuradas Vasanji Road, Andheri (East), Mumbai – 4000059 |
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Factory : |
v Plot No. A-22, M. I. D. C. Mahad - 402309,
Dist. Raigad, Maharashtra Tel. No. 91-2145-232043/44/45/46 Fax. No. 91-2145-232054/232048 v Ramkrishna Mandir Road, Off Mathuradas
Vasanji Road, Andheri (East), Mumbai – 400 059, Maharashtra Tel. No. 91-22-28367085 Fax. No. 91-22-28364565 v Plot No. 78-79, G. I. D. C. Industrial
Estate, Vapi - 396 195, Dist. Valsad, Gujarat Tel. No. 91-2638-230215/230521 Fax. No. 91-2638-230199 v Plot No. 23, G. I. D. C. Industrial
Estate, Vapi 396 195, Dist. Valsad, Gujarat Tel. No. 91-2638-230520/231517 Fax. No. 91-2638-231085 v Plot No. 25,26,39,40 Jawahar Co-opeative Industrial
Estate, Kamothe, Panvel - 410206, Dist. Raigad, Maharashtra Tel. No. 91-22-27421021/27421856 Fax. No. 91-22-2742332 v Plot No. 19, Taloja Industrial Estate,
Taloja, Dist. Raigad, Maharashtra Tel. No. 91-22-27410376/77 Fax. No. 91-22-27410376 v Daman, Union Territory |
DIRECTORS
|
Name : |
Mr. B. K. Parekh |
|
Designation : |
Chairman |
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|
Name : |
Mr. S. K. Parekh |
|
Designation : |
Vice Chairman |
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Name : |
Mr. M. B. Parekh |
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Designation : |
Managing Director |
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Name : |
Mr. N. K. Parekh |
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Designation : |
Joint Managing Director |
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Name : |
Mr. M. A. Pai |
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Designation : |
Director (w.e.f. 06.08.2001) |
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|
Name : |
Mr. H. K. Parikh |
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Designation : |
Director |
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Name : |
Mr. R. M. Gandhi |
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Designation : |
Director |
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Name : |
Mr. N. J. Jhaveri |
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Designation : |
Director |
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|
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|
Name : |
Mr. Bansi S.
Mehta |
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Designation : |
Additional Director (w.e.f. 25.07.2000) |
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Name : |
Mr. Ranjan Kapur |
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Designation : |
Additional Director (w.e.f. 17.10.2000) |
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Name : |
Mr. Yash Mahajan |
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Designation : |
Additional Director (w.e.f. 17.10.2000) |
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Name : |
Mr. A. B. Parekh |
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Designation : |
Whole Time Director |
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Name : |
Mr. A N Parekh |
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Designation : |
Whole Time Director |
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|
Name : |
Mr. Amit Roy |
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Designation : |
Whole Time Director |
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Name : |
Mr. Santosh Kumar |
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Designation : |
Whole Time Director |
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Name : |
Mr. S. T. Dave |
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Designation : |
Whole Time Director |
KEY EXECUTIVES
|
Name : |
Mr. P. C. Patel |
|
Designation : |
Senior Vice President & Company Secretary |
SHAREHOLDING
PATTERN
|
Names of Shareholders |
|
Percentage of
Holding |
|
|
|
|
|
Indian Promoters |
|
71.79 % |
|
Indian Public and
Bodies Corporate |
|
15.45 % |
|
FIIS &
Foreign Companies |
|
8.95 % |
|
UTI, Mutual
Funds, Bank & Insurance Companies |
|
3.81 % |
|
|
|
|
|
Total |
|
100 % |
BUSINESS DETAILS
|
Line of
Business : |
Manufacturing and
selling of branded consumer products like adhesives, sealants, art material
and construction paint and chemicals. |
|
|
|
|
Products : |
Item Code
No. Product Description 3506 Adhesives 3905 + 3906 Synthetic
Resins 3204 Organic Pigments and Preparations based on
Organic Pigments |
PRODUCTION STATUS
|
Particulars |
Unit |
Licensed
Capacity |
Installed
Capacity |
Actual
Production |
|
Dyestuffs |
MT |
3900 |
2364 |
12347c |
|
|
KL |
-- |
-- |
3178d |
|
Chemicals |
MT |
232735 |
126920 |
81417e |
|
|
KL |
31260 |
17904 |
21377f |
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GENERAL
INFORMATION
|
No. of
Employees : |
2944 |
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Bankers : |
·
Indian
Overseas Bank, Mumbai ·
Corporation
Bank, Mumbai ·
HDFC Bank,
Mumbai |
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Facilities : |
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Banking
Relations : |
Satisfactory |
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Auditors : |
Chartered Accountants
Solicitors and Advocates |
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Memberships : |
Confederation of
Indian Industry |
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|
|
|
Associates : |
·
Parekh
Marketing Limited ·
Vinyl
Chemical (India) Limited ·
Kalva
Chemicals Limited |
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|
|
|
Subsidiaries : |
·
Fevicol
Company Limited ·
Pagel
Concrete Technologies Private Limited ·
Pidilite
USA, Inc ·
Pidilite
Innovation Centre Private Limited ·
Pidilite
Middle East Limited ·
Parekh
Marketing Limited ·
Vinyl
Chemicals (India) Limited ·
Kalva
Marketing and Services Limited |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
27500000 |
Equity shares |
Rs. 10.00 each |
Rs. 275.000 millions |
|
2500000 |
Unclassified
shares |
Rs. 10.00 each |
Rs. 25.000 millions |
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|
|
|
|
|
|
Total |
|
Rs. 300.000 millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
25239400 |
Equity shares |
Rs. 10.00 each |
Rs. 252.390 millions |
|
Add: |
Bonus shares
issue suspense account |
|
Rs. 0.010 million |
|
|
|
|
|
|
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Total |
|
Rs. 252.400 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 |
252.400 |
252.400 |
252.400 |
|
|
2] Reserves & Surplus |
4627.400 |
3871.100 |
3322.100 |
|
NETWORTH
|
4879.800 |
4123.500 |
3574.500 |
|
|
|
|
|
|
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
749.400 |
287.000 |
159.300 |
|
|
2] Unsecured Loans |
633.600 |
265.900 |
450.300 |
|
|
TOTAL BORROWING |
1383.000 |
552.900 |
609.600 |
|
|
Deferred Tax Liabilities |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
TOTAL
|
6262.800 |
4676.400 |
4184.100 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
3024.900 |
2648.800 |
2248.500 |
|
|
Capital work-in-progress |
346.600 |
257.500 |
319.000 |
|
|
|
|
|
|
|
|
INVESTMENTS |
892.000 |
358.600 |
184.300 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
1976.200 |
1534.000 |
1299.500 |
|
|
Sundry Debtors |
1318.100 |
1094.500 |
1083.700 |
|
|
Cash & Bank Balances |
231.700 |
121.600 |
116.600 |
|
|
Other Current Assets |
0.000 |
0.000 |
0.000 |
|
|
Loans & Advances |
612.400 |
356.900 |
362.800 |
|
Total Current
Assets |
4138.400 |
3107.000 |
2862.600 |
|
|
|
|
|
|
|
|
Less : CURRENT LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
1648.200 |
1301.900 |
1119.100 |
|
|
Provisions
|
493.300
|
398.500 |
318.500 |
Total
Current Liabilities
|
2141.500 |
1700.400 |
1437.600 |
|
|
Net Current
Assets |
1996.900 |
1406.600 |
1425.000 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
2.400 |
4.900 |
7.300 |
|
|
|
|
|
|
|
GRAND TOTAL
|
6262.800 |
4676.400 |
4184.100 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
Sales Turnover |
12901.300 |
10442.400 |
8897.700 |
|
|
Other Income |
190.300 |
174.800 |
100.700 |
|
|
Stock Adjustments |
270.400 |
166.000 |
126.400 |
|
|
Total Income |
13362.000 |
10783.200 |
9124.800 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
1539.800 |
1312.500 |
1061.800 |
|
|
Provision for Taxation |
342.800 |
426.000 |
332.200 |
|
|
Profit/(Loss) After Tax |
1197.000 |
886.500 |
729.600 |
|
|
|
|
|
|
|
|
Earnings in Foreign Currency : |
|
|
|
|
|
|
Export Earnings |
955.030 |
645.630 |
NA |
|
|
Other Earnings |
0.750 |
0.470 |
NA |
|
Total Earnings |
955.780 |
646.100 |
NA |
|
|
|
|
|
|
|
|
Imports : |
|
|
|
|
|
|
Raw Materials |
1843.130 |
1256.380 |
NA |
|
|
Capital Goods |
35.750 |
10.600 |
NA |
|
|
Others |
169.120 |
96.520 |
NA |
|
Total Imports |
2048.000 |
1363.500 |
NA |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Raw Materials |
5358.900 |
4039.200 |
3452.400 |
|
|
Excise Duty |
1370.600 |
1380.200 |
1230.100 |
|
|
Power and Fuel Cost |
136.300 |
401.200 |
97.400 |
|
|
Other Manufacturing Expenses |
2278.000 |
1784.900 |
1466.800 |
|
|
Employee Cost |
869.900 |
746.500 |
612.700 |
|
|
Selling and Administration Expenses |
1098.000 |
867.900 |
735.700 |
|
|
Miscellaneous Expenses |
316.400 |
235.200 |
158.900 |
|
|
Interest and financial Charges |
91.40 |
37.800 |
39.100 |
|
|
Depreciation |
302.700 |
274.800 |
269.900 |
|
Total Expenditure |
11822.200 |
9767.700 |
8063.000 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2007 (1st
Quarter) |
30.09.2007 (2nd
Quarter) |
31.12.2007 (3rd
Quarter) |
|
Sales
Turnover |
3726.000 |
3705.000 |
3889.000 |
|
Other
Income |
58.000 |
67.000 |
98.000 |
|
Total
Income |
3784.000 |
3772.000 |
3987.000 |
|
Total
Expenditure |
2977.000 |
2986.000 |
3326.000 |
|
Operating
Profit |
807.000 |
786.000 |
661.000 |
|
Interest |
17.000 |
32.000 |
51.000 |
|
Gross
Profit |
790.000 |
754.000 |
610.000 |
|
Depreciation |
84.000 |
80.000 |
95.000 |
|
Tax |
131.000 |
112.000 |
9.000 |
|
Reported
PAT |
580.000 |
563.000 |
409.000 |
KEY RATIOS
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt Equity Ratio |
0.22 |
0.15 |
0.18 |
|
Long Term Debt Equity Ratio |
0.13 |
0.09 |
0.09 |
|
Current Ratio |
1.57 |
1.67 |
1.71 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
2.64 |
2.48 |
2.44 |
|
Inventory |
7.35 |
7.37 |
7.58 |
|
Debtors |
10.69 |
9.59 |
8.66 |
|
Interest Cover Ratio |
17.85 |
35.72 |
28.16 |
|
Operating Profit Margin (%) |
14.99 |
15.56 |
15.41 |
|
Profit Before Interest and Tax Margin (%) |
12.64 |
12.93 |
12.37 |
|
Cash Profit Margin (%) |
11.62 |
11.12 |
11.23 |
|
Adjusted Net Profit Margin (%) |
9.28 |
8.49 |
8.20 |
|
Return on Capital Employed (%) |
29.84 |
30.52 |
28.13 |
|
Return on Net Worth (%) |
26.59 |
23.03 |
21.87 |
STOCK PRICES
|
Face Value |
Rs. 10 |
|
High |
Rs. 135.75 |
|
Low |
Rs. 130.20 |
LOCAL AGENCY
FURTHER INFORMATION
History
Subject was established
as a partnership firm under the name and style of “Parekh Dyechem Industries”,
in 1959 by Mr. B. K. Parekh and his two brothers, S. K. Parekh and H. K.
Parekh. It was converted into a private
limited company in 1969. A group company Kondivita Industries was merged with
the company in 1984. Its name was
changed to PDI Chemicals Limited in 1988.
In 1989, another group company, Pidilite Industries Limited was merged with
PDI Chemicals, and the name of the merged entity was changed to Pidilite Industries. Triveni Chemicals, another group company,
was also merged with Pidilite in 1992.
While the Fevicol brand, launched in 1959, has been in existence for
almost 40 years, the company’s consumer products division was set up in 1984,
when the company decided to build up a strong distribution network.
The company has
been a pioneer and market leader in the field of consumer and speciality
chemicals in India, since its inception in 1959. The company’s proactive market
– driven approach has given it a strong base between both consumer and
industrial segments. The company has a wide range of products, which find
application in construction, plastics, textiles, paper, leather, paints,
engineering, nurtured over four decades. The company’s brand ‘Fevicol’ is a
market leader in the synthetic adhesives market. The company has a diverse
product range, a number of established brands and a large distribution network
of dealers, retail outlets, offices and sales representatives spread throughout
the country. The company has been awarded the status of Export House by the
Government of India.
The company
acquired the brand “Ranipal” along with the goodwill of the business, other
assets and know-how from Indian Dyestuff Industries Limited in August 1999 for
a consideration of Rs. 40 millions. Brands “M-Seal” and “Mr. Fixit” along with
adhesives and sealants business of Mahindra Engineering and Chemical Products
Limited, other assets and know-how were acquired in March 2000 for a
consideration of Rs. 320 millions. During the year 1999-2000, the company
issued bonus shares in ratio of 1:1.
During the year
2001, the company extended Ranipal brand to products such as stain removers and
detergent enhances. The company had also plan to introduce a range of products for
waterproofing as well as repairs and maintenance of buildings under the brand
Dr. Fixit. The total capital expenditure incurred for modernization and
upgradation of its plants were Rs. 299.800 millions. It has acquired the brands
of Bullbond and Vitapon at a consideration of Rs. 66.400 millions from Parekh
Marketing Limited. From the Kalva Chemicals Limited, the company has acquired
Kalvyl, Tracol and Parvyl brands of Adhesives/Resins for a consideration of Rs.
16.900 millions.
Milestones
|
Year |
|
Achievements |
|
|
||
|
1959 |
|
Plants
commissioned for Acron brand of pigment emulsion |
|
1965 |
FEVICOL,
established as carpenter’s preferred choice of synthetic adhesive |
|
|
1973 |
First
company in India to start production of violet pigment |
|
|
1984 |
Consumer
Products Division is born. Plans to set up a nation-wide distribution chain |
|
|
1989 |
Fevicryl
acrylic colours transform fabric and multi-surface painting market |
|
|
1993 |
Pidilite
makes a maiden public offering of equity shares |
|
|
1995 |
Plants
in Mumbai & Vapi acquire ISO 9001; plant at Mahad acquires ISO 9002
certification |
|
|
1997 |
Fevicol
ranked among the Top 15 Indian brands (by FE Brandwagon Year Book, 1997) |
|
|
1999 |
"Ranipal",
leading brand of optical whitener, acquired |
|
|
2000 |
"M-Seal",
leading brand of epoxy compounds, acquired |
|
|
2000 |
Fevikwik
“fish” commercial wins Golden ABBY for the best TV Commercial of the Century
in India |
|
|
2000 |
Fevicol
campaign wins Silver ABBY for the Campaign of the Century in India |
|
|
2001 |
Dr.
Fixit range of Construction Chemicals launched |
|
|
2002 |
"Steelgrip",
leading brand of PVC insulation tape in India, acquired |
|
|
2002 |
At the
2002 Cannes Awards, considered to be the Oscar of the advertising world,
Fevicol 'Bus' TV commercial wins a Silver in the category for Household
Maintenance Products |
|
The company’s proactive
market driven approach has given it a strong base among both consumer and
industrial segments. The company has a wide range of products, which find
application in construction, plastics, textiles, paper, leather, paints,
engineering, nurtured over four decades. The company’s brand, Fevicol, is a
market leader in synthetic adhesives market. The company has a diverse product
range, a number of established brands and a large distribution network of
dealers, retail outlets, offices and sales representatives spread throughout
the country.
Its product
range includes:
·
Fevicryl
Exotica
·
Acrylic
Colours (Fabric)
·
Fevicryl
Fabric Glue
·
Window Colours
·
Acrylic
Colours for Canvas
·
Fevicryl Puff
Ons
·
Fevicryl Silk
Colours
The company has participated
in international exhibitions in Bangladesh, Singapore, USA, Spain and Germany
to enhance export of products.
The company exports
its products to Europe, USA, Canada, Latin America, Australia, New Zealand,
South East Asia, SAARC Countries and Africa.
The company's
manufacturing process include:-
·
Different
polymerization techniques such as emulsion polymerization, suspension
polymerization, solution polymerization.
·
A wide range
of chemical synthesis steps like nitration, reduction, ethylation,
chlorination, sulfonation and coupling-diazotization.
·
Specialized
physical process such as pigmentation, dispersion, size reduction, etc.
Awards
·
The Company
won the Special Gold Award for the Best Continuing Campaign.
·
The Fevicol
“Pretender” TV Commercial won ABBY Silver in the Homes/Décor/Leisure Category.
The company is
in trade terms with:
·
Alpack Paper
Packaging Private Limited
·
Bago Cans
Private Limited
·
Bharat Metal
Industries
·
Shetty Plast
Private Limited
·
The Bharat
Vijay Iron Factory
·
Nova Plast
Industries Private Limited
·
Poonam Plastic
Industries
·
Jamuna Plast
Private Limited
·
Nayakem
Organics Private Limited
·
Vallabh
Industries
·
Modern
Packaging
Fixed Assets
- Goodwill
- Freehold Land
- Leasehold Land
- Buildings
- Plant & Machinery
- Trademark
- Copyrights
- Furniture and Fixtures
- Vehicles
Management Discussion and Analysis
Subject on a stand-alone basis
achieved 23.50% growth in gross sales in 2006-07. The profit before Tax grew by
17.30% and profit after tax grew by 32.30% in the same period. Profit before
tax grew at a slower rate due to continued high prices of some raw materials
and increased spends on advertisement and brand building activities to increase
consumption of their products.
On a consolidated basis, subject
achieved 31.30% growth in gross sales, 13.20% growth in profit before tax and
26.60% growth in profit after tax.
Performance by Industry Segment
Branded consumer and Bazaar Products contributed to 76% of the total sales of
the company and grew by 23.50% during the year.
Sales of branded Adhesives and Sealants grew by 22.10% and
contributed 54% to the total sales of the company. Construction and Paint
Chemicals grew by 24.80% and Art Materials and other products grew by 34.50%.
Exports of consumer and Bazaar Products grew by 60.10% during the year. Most
Brands in consumer and bazaar segment maintained or improved their market
share.
Speciality Industrial Chemicals contributed 245 to the total
sales of the company and grew by 23.60%.
Internal
Business and Exports
Exports of consumer and Bazaarf Products grew by 60.10% to Rs. 509.000 million.
Exports of Speciality Chemicals grew by 33.30% to Rs. 459.000 millions.
The Company continued to make good progress in Middle East,
Africa and South Asia with brand Fevicol gaining market share in several
countries in these regions.
During 2006-07 the Company received permission for opening
offices in South Africa, Kenya and Ghana. This will facilitate the company to
appoint distributors and sell its products practically all over the Africa.
Progress was made towards establishing distribution network
in Indonesia. Distributors were appointed in all major parts of the country.
Mergers
and Acquisitions
Pidilite USA, Inc., a wholly-owned subsidiary of the Company
acquired brands and busienss of Sargent Art Inc. and Cyclo LLC in June 2006.
Sargent Art has been manufacturing and selling quality Art
Materials in Educational Market in USA for over 50 years. The product range includes
tempera colours, acrylic colours, water-colours, crayons, markers and number of
other high quality products for Educational market.
Cyclo has been selling automotive chemicals in USA and international
market for over 50 years. The product range includes maintenance chemicals,
performance chemicals and appearance chemicals for automotive segment.
The company acquired controlling equity in Pagel Concrete
Technologies Private Limited in India. This Company is having technical and
financial collaboration with Pagel Seezial-Benton GMBH and company KG. Pagel is
an internationally known brand for industrial grouts and repair mortars.
New
Products
The Company introduced various new products during the year.
Adhesives and sealants range was expanded with introduction
of marble glue and wood re-inforced adhesive under brand name Fevicol, fast
setting epoxy adhesive under the brand name Fevitite Super Fast, new generation
adhesive under the brand name Cheetah Glue, easy to use sealant under the brand
name Dr. Fixit Gapfill and masking tape under the brand name US-Pro. In
addition to this, several adhesives for wood working and related applications
were introduced for international market.
The construction chemicals range continued to grow with
introduction of several products including a waterproofing coating for terrace
under the brand name Newcoat, a waterproof decorative wall coating under the
brand name Raincoat and a heat reducing exterior coating under the brnad name
Heatshield.
Several new products were added to the hobby and art
material range and car care range.
Financial
performance
The Operating Profit for the year (before VRS
payment of Rs. 2.400 millions) at Rs. 1907.600 millions, grew by 18.90% Net
Profit at Rs. 1199.300 millions, after Prior Year Tax provision written back of
Rs. 2.300 million, grew by 32.30%.
Income Tax for the current year is lowers at
Rs. 308.900 million (including Rs. 20.100 millions for fringe Benefit Tax) as against
Rs. 409.000 millions in the previous year.
Subsidiaries
Pagel Concrete Technologies Private Limited (Pagel):
The Company acquired 75% Equity stake in this
Company at a cost of Rs. 6.400 millions and loan contribution of Rs. 3.500
millions. Pagel is an existing Company incorporated in India in technical and
financial collaboration with PAGEL SPEZIA-BETON GMBH & CO. KG, Germany and
engaged in the business of grouts and special mortars.
Pidilite USA, Inc (PIL Inc.)
The company was incorporated on 12.05.2006 in
Delaware, USA and acquired the business and assets relating to art material and
car care products from two existing companies in USA in June 2006, having
combined annual sales turnover of US $ 19 millions. The cost of acquisition in
US $ 12 millions.
Pidilite Innovation Centre Private Limited (PICPL)
Pidilite International Private Limited,
Singapore as a wholly owned subsidiary of the /company has incorporated PICPL,
a subsidiary in Singapore on 20.12.2006 to carry out Research, Development and
related activities.
With the above acquisitions now the Company
has 4 direct Overseas Subsidiaries one each in Singapore (Pidilite
International Private Limited) in UAE (Pidilite Middle East Limited) in Brazil
(Pidilite Do Brasil Desenvolvemento De Negocios Limited) and in USA (Pidilite
USA, Inc.)
These subsidiaries have total 6step –down
subsidiaries viz. Chemson Asia Private Limited (Singapore), Jupitor chemicals
LLC (Dubai), Pidilite Speciality Chemicals Bangladesh Private Limited
(bangladesh), Bamco Limited (Thailand), PT Pidilite Indonesia (Indonesia),
Pidilite Innovation Centre Private Limited (Singapore)
The total investments during the year by our
Company in all Overseas Subsidiaries exceeded US $ 16.70 millions.
A statement pursuant to Section 212 of the
Companies is attached hereto.
Consolidated Accounts
In accordance with the requirements of
Accounting Standards AS 21 (read with AS 23) issued by the Institute of
Chartered Accountants of India, the consolidated Accounts of the Company and
its twelve subsidiaries are annexed to this Annual Report. Additionally, a
statement giving prescribed particulars of information, in aggregate for each
subsidiary, is attached.
Industry Structure and Development
There is no change in the industry structure
as was reported in the last year.
The company operates under two major business
segments i.e. Branded consumer and Bazaar Products and Speciality Industrial
Chemicals.
Products such as Adhesives, Sealants, Art
Materials, construction and Paint Chemicals are covered under branded Consumer
and Bazaar Product Segment. These products are widely used by carpenters,
painters, plumbers, mechanics, households, students, offices, etc.
Speciality Industrial chemicals segment covers
products such as Industrial Adhesives, Synthetic Resins, Organic Pigments,
Pigment Preparations, Surfactants, etc and caters to various industries like
packaging, textiles, paints, printing inks, paper, leather, etc.
In both the above business segments, there are
a few medium to large companies with national presence, and a large number of
small size companies that are active regionally. There is growing presence of multinationals in many of the
segments in which we operate. The share of imports is less than 10% of domestic
volumes in most of the product segments.
Vinyl Chemicals (India) Limited (VCIL)
The company is a principal promoter of VCIL
and has made strategic investment in VCIL.
The Company was approached by a Review
Committee appointed by the Board of Directors of VCIL for support in the task
of restructuring VCIL’s operations which had resulted into losses for 5
consecutive quarters till 31.12.2006
The Board of Directors of this Company had
therefore appointed a Special Committee to examine all relevant aspects as also
explore possible remedial measures. The Special Committee took a view that VAM
manufacturing plant of VCIL is of strategic importance to the Company and that
there is good probability of VAM manufacturing unit becoming profitable
sometime during the year 2008. The Committee therefore recommended to the Board
of Directors of this Company that VCIL’s manufacturing division at Mahad be
demerged into this Company.
Social Responsibility
Hanumant Hospital
In its first year of operation, the hospital
has treated over 63,000 outpatients, performed over 1,500 surgeries and handled
around 180 successful maternity cases.
The hospital conducts regular medical camps at
various rural locations. Visiting specialists of different disciplines provide
services at these camps. In order to provide medical services to villagers at
their doorstep, three Arogya Kendras have been opened in villages.
Sanjeevani health scheme operated by the
hospital provides comprehensive health care to low-income families on payment
of nominal annual fees. The hospital is also a Government recognized center for
DOTS programme for TB Patients, PPTCT for HIV patients, MTP and Vaccination
Center.
Gram Nirman Samaj
Construction and repair of Check Dams have
been undertaken. More than 100 small and medium projects have been undertaken
relating to water conservation and water shed development. These projects
involve construction of new check Dams, repair and renovation of old check
Dams, Digging and deepening of ponds, repair and renovation of village ponds
and percolation tanks. These activities have resulted in continuous improvement
of water table and good crop yields.
Constructed 1,430 individual toilets in 10
villages of Mahuva Taluka. These 10 villages are declared as Nirmal Gram
entitled for Rashtrapati Puraskar. Also constructed 40 school sanitation blocks
and 103 Anganwadi sanitation blocks in rural area.
Education
Shree Mahuva Education Trust runs Arts, Science,
commerce and computer Science colleges. About 1,300 students are studying in
these Colleges. During the year construction work has commenced for library
building and BBA college building.
Science City
A Science city is being established with the
main objective of encouraging scientific temper and spirit of enquiry amongst
young children and to stimulate them to think freely and achieve their
potential. The Science City, which is being built at a cost of Rs. 30.000
millions, will provide facilities for scientific experiments and will also have
a library as well as computer facilities.
During the year the Company has donated
approximately Rs. 95.000 millions to Hanumant Seva Medicare Trust and has
committed to donate Rs. 15.000 millions during 2007-08 to the Science City
Project in Bhavnagar.
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.59.39 |
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 |
|