MIRA
INFORM REPORT
|
Report Date : |
05.01.2008 |
IDENTIFICATION
DETAILS
|
Name : |
DEEPAK
FERTILISERS AND PETROCHEMICALS CORPORATION LIMITED |
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Registered Office : |
Opposite
Golf Course, Shastri Nagar, Yerawada, Pune – 411 006, Maharashtra |
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Country : |
India |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
31.05.1979 |
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Com. Reg. No.: |
11-21360 |
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CIN No.: [Company
Identification No.] |
U24121MH1979PLC021360 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
MUMD10002G |
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PAN No.: [Permanent
Account No.] |
AAACD1388D |
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Legal Form : |
It is
a public limited liability company. The
company's shares are listed on the Stock Exchanges. |
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Line of Business : |
Manufacturing
of Ammonia, Methanol, Nitric Acids (in various concentrations), Low Density
Prilled Ammonium Nitrate (Explosive Grade) and Nitrophosphate Fertilisers, Chemical
Fertilisers containing Nitrates and Phosphates (Nitrophosphates / Ammonium Nitrate Phosphate), Organic
Chemicals, Acrylic Alcohols, Methyl Alcohol and Ammonium Nitrate. |
RATING &
COMMENTS
|
MIRA’s Rating : |
Aa |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
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|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
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Maximum Credit Limit : |
USD 25000000 |
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Status : |
Very 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 satisfactory track. Directors are reported as experienced,
respectable and resourceful industrialists.
Their trade relations are reported as fair. General financial position is satisfactory. Payments are usually correct and as per
commitments. The
company can be considered normal for your business dealings at usual trade
terms and conditions. |
LOCATIONS
|
Registered Office : |
Opposite Golf Course, Shastri Nagar, Yerawada, Pune – 411
006, Maharashtra, INDIA |
|
Tel. No.: |
91-20-26684155/26684342/26684597/26684235/26458000 |
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Fax No.: |
91-20-26687499/26683727 |
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E-Mail : |
·
corpcom@deepakfertilisers.com
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Website : |
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Factory : |
Plot No.
K-1, MIDC Industrial Area, Taloja, A. V. – 410 208, District Raigad,
Maharashtra |
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Tel. No.: |
91-22-27412411/2412/27412810/11/12 |
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Fax No.: |
91-22-27412413 |
DIRECTORS
|
Name : |
Mr. C. K. Mehta |
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Designation : |
Chairman |
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Qualification : |
Undergraduate |
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Date of Appointment : |
31.05.1979 |
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Other
Directorships :- |
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Name : |
Mr. D. C. Mehta |
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Designation : |
Director |
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Qualification : |
B.
Sc. |
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Date of Appointment : |
31.05.1979 |
|
Other
Directorships :- |
·
Deepak
Nitrite Limited ·
Nova
Synthetic Limited ·
Skyrose
Finvest Private Limited ·
Sundown
Finvest Private Limited ·
Forex
Leafin Private Limited ·
Pranawa
Leafin Private Limited ·
Hardik
Leafin Private Limited ·
Samoon
Investment and Finance Private Limited ·
The
Lakaki Works Private Limited |
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|
|
|
Name : |
Mr. S. C. Mehta |
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Designation : |
Vice
Chairman and Managing Director |
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Qualification : |
B.
Com., M.B.A. (U.S.A.) |
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Date of Appointment : |
04.09.1985 |
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Other
Directorships :- |
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|
Name : |
Mr. D. Basu |
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Designation : |
Director |
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Qualification : |
Master’s
Degree in Economics |
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Date of Appointment : |
27.07.2000 |
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Other
Directorships :- |
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Experience : |
Mr. S. S. Marathe |
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Date of Appointment : |
Director |
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Name : |
Mr. R. A. Shah |
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Designation : |
Director |
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Name : |
Mr. A. C. Mehta |
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Designation : |
Director |
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Qualification : |
B.
Sc. (Hons) M. S. Chemical Engineers (USA) |
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Date of Appointment : |
22.05.2003 |
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Other
Directorships :- |
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|
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|
Name : |
Mr.
N. C. Singhal |
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Designation : |
Director |
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Name : |
Mr. U. P. Jhaveri |
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Designation : |
Director |
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Name : |
Mr. S. R. Wadhwa |
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Designation : |
Director |
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Name : |
Mrs. Parul S.
Mehta |
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Designation : |
Director |
KEY EXECUTIVES
|
Name : |
Mr. Aioke
Sengupta |
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Designation : |
(Nominee of IDBI) |
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|
|
Name : |
Dr. T. K.
Chatterjee |
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Designation : |
Chief Operating
Officer |
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Name : |
Mr. N. D. Joshi |
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Designation : |
Chief Financial
Officer |
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Name : |
Mr. T. D.
Mathwani |
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Designation : |
Sr.
Vice-President (Projects and Technology) |
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Name : |
Mr. R. Sriraman |
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Designation : |
Sr.
Vice-President (Legal) and Company Secretary |
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Name : |
Mr. R. P. Karnik |
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Designation : |
Vice-President
(Projects) |
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Name : |
Mr. D. A. Desai |
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Designation : |
Vice-President
(Co-ordination) |
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Name : |
Mr. S. P. Arya |
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Designation : |
Vice-President
(Manufacturing) |
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Name : |
Mr. S. M. Desai |
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Designation : |
Vice-President
(Co-ordination) |
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Name : |
Mr. A. C.
Augustine |
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Designation : |
Vice-President
(Human Resource) |
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Name : |
Mr. V. S. Laghate |
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Designation : |
Vice-President
(Strategic Planning) |
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|
Name : |
Mr. V. Y. Kelkar |
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Designation : |
Vice President
(Corporate Communication) |
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|
Name : |
K. V. Nayak |
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Designation : |
Vice-President
(Agri- Business) |
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|
|
Name : |
Mr. Anil Rakheja |
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Designation : |
Vice- President
(Project ) |
BUSINESS DETAILS
|
Line of Business : |
Manufacturing
of Ammonia, Methanol, Nitric Acids (in various concentrations), Low Density
Prilled Ammonium Nitrate (Explosive Grade) and Nitrophosphate Fertilisers,
Chemical Fertilisers containing Nitrates and Phosphates (Nitrophosphates/Ammonium Nitrate
Phosphate), Organic Chemicals, Acrylic Alcohols, Methyl Alcohol and Ammonium
Nitrate. |
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Products : |
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Brand Names : |
Optimex,
Optiform, Optispan and Mahadhan |
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Exports : |
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Countries : |
Ammonium
Nitrite and Nitric Acid to Saudi Arabia, Dubai, Kenya and Uganda |
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Imports : |
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Countries : |
Methanol
and Ammonium from Qatar, Iran, Saudi, Ukraine, Russia, Europe and Far East |
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Terms : |
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Purchasing : |
L/C,
D/A and D/P |
PRODUCTION STATUS
|
Particulars |
Unit |
|
|
Installed
Capacity |
|
Ammonia |
(MT) |
|
|
90000 |
|
CNA |
(MT) |
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|
79200 |
|
DNA |
(MT) |
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|
297000 |
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Methanol |
(MT) |
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|
100000 |
|
AN |
(MT) |
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|
90000 |
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CO2 |
(MT) |
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|
16500 |
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ANP |
(MT) |
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|
229500 |
GENERAL
INFORMATION
|
Customers : |
·
Methanol ·
Nitric
Acid ·
Strong
Nitric Acid (SNA) ·
Dry
Ice ·
Dilute
Nitric Acid (DNA) ·
Concentrated
Nitric Acid (CAN) ·
Low
Density Ammonium Nitrate (LDAN) |
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No. of Employees : |
1050 |
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Bankers : |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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|
Name : |
B. K.
Khare and Company Chartered
Accountants |
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Address : |
Mumbai,
Maharashtra, India |
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Associates: |
Ø
Deepak
Nitrite Limited Deepak Complex, National Games Road, Yerawada, Pune – 411 006, Maharashtra Tel. 91-20-26689265 Fax. 91-20-26685448 Ø
Aryan
Pesticides Limited Ø
Checkpoint
Credits and Capital Private Limited Ø
Deepak
Refinery Limited Ø
Hardik
Leafin Private Limited Ø
Pranava
Leafin Private Limited Ø
Sapna
Investments Private Limited Ø
Stiffen
Credits and Capital Private Limited Ø
Superpose
Credits and Capital Private Limited Ø
Yerawada
Investments Limited Ø
Blue
Shell Investments Private Limited Ø
Deepak
Agro Solutions Limited Ø
Deepak
Phosphatics Private Limited Ø
Forex
Leafin Private Limited Ø
Nova
Synthetic Limited Ø
Prolific
Credits and Capital Private Limited Ø
Skyrose
Finvest Private Limited Ø
Sofotel
Software Services Private Limited Ø
Sundown
Finvest Private Limited Ø
The
Lakaki Works Private Limited |
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|
|
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Subsidiaries |
Smartchem
Technologies Limited (from 09.12.2003) |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
125,000,000 |
Equity Shares |
Rs.10/- each |
Rs.1250.000 millions |
|
1,000,000 |
Cumulative Redeemable Preference Shares |
Rs.10/- each |
Rs. 100.000 millions |
|
|
GRAND TOTAL |
|
Rs.1350.000
millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
8,82,04,943 |
Equity Shares |
Rs.10/- each |
Rs. 882.049 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 |
882.000 |
882.049 |
882.049 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
5472.600 |
4854.718 |
4360.716 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
6354.600 |
5736.767 |
5242.765 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
2553.100 |
1760.801 |
908.521 |
|
|
2] Unsecured Loans |
700.000 |
0.000 |
0.000 |
|
|
TOTAL BORROWING |
3253.100 |
1760.801 |
908.521 |
|
|
DEFERRED TAX LIABILITIES |
0.000 |
483.114 |
510.686 |
|
|
|
|
|
|
|
|
TOTAL |
9607.700 |
7980.682 |
6661.972 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
4393.400 |
2694.695 |
2964.734 |
|
|
Capital work-in-progress |
1877.500 |
2256.755 |
810.942 |
|
|
|
|
|
|
|
|
INVESTMENT |
2096.100 |
2266.543 |
2484.936 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Interest Accrued on Deposits |
0.000
|
9.445
|
9.346
|
|
|
Inventories |
1156.900
|
609.118
|
383.605
|
|
|
Sundry Debtors |
1219.800
|
906.034
|
548.191
|
|
|
Cash & Bank Balances |
350.700
|
226.665
|
231.322
|
|
|
Loans & Advances |
936.400
|
490.457
|
417.534
|
|
|
Other Current Assets |
0.000
|
102.000
|
0.000
|
|
Total Current Assets |
3663.800 |
2343.719 |
1589.998
|
|
|
Less : CURRENT LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
2085.600 |
1153.585 |
724.956 |
|
|
Provisions |
356.200 |
452.717 |
463.682 |
|
Total Current Liabilities |
2441.800 |
1606.302 |
1188.638
|
|
|
Net Current Assets |
1222.000 |
737.417 |
401.360
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
18.700 |
25.272 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
9607.700 |
7980.682 |
6661.972 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
Sales Turnover |
9057.900
|
6126.400
|
5293.900
|
|
|
Other Income |
368.900
|
457.600
|
274.800
|
|
|
Total Income |
9426.800 |
6584.000 |
5568.700 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
1282.300
|
1115.600
|
1123.400
|
|
|
Provision for Taxation |
353.000
|
317.900
|
325.900
|
|
|
Profit/(Loss) After Tax |
929.300
|
797.700
|
797.500
|
|
|
|
|
|
|
|
|
Earnings in Foreign Currency : |
NA |
139.502 |
92.873 |
|
|
|
|
|
|
|
|
Imports : |
NA |
1939.105 |
792.093 |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Raw Materials |
5859.600
|
3427.100
|
2425.400
|
|
|
Excise Duty |
765.200
|
495.000
|
512.100
|
|
|
Power & Fuel Cost |
169.500
|
126.500
|
162.500
|
|
|
Other Manufacturing Expenses |
343.300
|
241.800
|
241.900
|
|
|
Stock Adjustments |
[468.900]
|
[55.500]
|
8.300
|
|
|
Employee Cost |
421.900
|
375.600
|
364.600
|
|
|
Selling and Administration Expenses |
330.600
|
216.500
|
183.200
|
|
|
Miscellaneous Expenses |
217.600
|
269.300
|
149.700
|
|
|
Interest & Financial Charges |
114.900
|
56.500
|
86.500
|
|
|
Depreciation |
390.800
|
315.600
|
311.100
|
|
Total Expenditure |
8144.500 |
5468.400 |
4445.300 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
30.06.2007 |
30.09.2007 |
|
Type |
|
1ST
Quarter |
2nd
Quarter |
|
Sales Turnover |
|
2197.900
|
2169.000
|
|
Other Income |
|
115.600
|
139.400
|
|
Total Income |
|
2313.500
|
2308.400
|
|
Total Expenditure |
|
1812.300
|
1847.800
|
|
Operating Profit |
|
501.200
|
460.600
|
|
Interest |
|
50.000
|
30.500
|
|
Gross Profit |
|
451.200
|
430.100
|
|
Depreciation |
|
106.100
|
108.400
|
|
Tax |
|
127.900
|
115.700
|
|
Reported PAT |
|
225.800
|
218.800
|
KEY RATIOS
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt
Equity Ratio |
0.41 |
0.24 |
0.22 |
|
Long
Term Debt Equity Ratio |
0.36 |
0.24 |
0.22 |
|
Current
Ratio |
1.15 |
1.03 |
1.05 |
|
TURNOVER
RATIOS |
|
|
|
|
Fixed
Assets |
1.16 |
0.90 |
0.80 |
|
Inventory
|
10.24 |
12.34 |
13.77 |
|
Debtors |
8.52 |
8.43 |
7.48 |
|
Interest
Cover Ratio |
12.16 |
17.82 |
13.99 |
|
Operating
Profit Margin (%) |
19.74 |
21.59 |
28.73 |
|
Profit
Before Interest and Tax Margin (%) |
15.43 |
16.43 |
22.85 |
|
Cash
Profit Margin (%) |
14.57 |
16.29 |
20.94 |
|
Adjusted
Net Profit Margin (%) |
10.26 |
11.14 |
15.06 |
|
Return
on Capital Employed (%) |
16.38 |
14.78 |
19.84 |
|
Return
on Net Worth (%) |
15.37 |
12.43 |
16.00 |
LOCAL AGENCY
FURTHER INFORMATION
HISTORY
Promoted
in 1979 by Deepak Nitrite and C K Mehta as a private limited company, Deepak Fertilisers
became a public company in 1982. It manufactures anhydrous liquid ammonia. The
272-tpd plant at Taloja went on stream in Dec.'83. The plants are located in
the well developed industrial area at Taloja near Bombay. Consistent supply of
crucial raw material - Natural Gas - is assured through Deepak's own gas
pipeline direct from Bombay High gas fields.
Smartchem Technologies Limited and Deepak Nitrochem Pty Limited, Australia are
the subsidiaries of the company.
The company diversified into the manufacture of ammonium nitro-phosphate (ANP)
fertiliser (cap. : 23 Millions tpa) and
integrated into the manufacture of concentrated nitric acid (33,000 tpa),
ammonium nitrate (36,000 tpa) and dilute nitric acid (200,000 tpa). It also set
up a 100,000-tpa methanol project which was part financed through a public
issue of convertible debentures in Jan.'89. DFL has a technical collaboration
with Fish International Engineers, US and Stamicarbon, the Netherlands. The
Programme for retrofit Ammonia Plant was completed by end March, 2000.
Keeping in mind the constraint of gas supply, the company had invested in a
port-based storage facility for imported ammonia. The Company is also exploring
the possibility of increasing the number of sources of Ammonia including the
option of setting up a gas-based Ammonia plant abroad and also studying
oppportunities for broad-basing industrial chemical products through forward
integration. The company has implemented the debottlenecking of Ammonia Plant
but the additional gas supply was never received.
The expansion of NP fertilizer plant to 3,00,000 tons p.a and LDAN plant to
1,00,000 tons p.a was taken up in 2001-02. The engineering work for AN Melt
capacity was completed and the above the plants were commissioned during
2002-03 there by enhancing the capacity by 90,000 tpa. Technology for the new
plant has been supplied by Grande Praoisse, France.
The company has increased the installed capacity of CNA by 23100 MT during
2004-05 and with this expansion the total installed capacity of CNA has
increased to 79200 MT.
MANAGEMENT DISCUSSION AND ANALYSIS
THE MACRO-SCENARIO
The Indian
economic growth story continues unabated. The country is in the midst of a very
clear structural shift into a higher GDP growth rate bracket. Though managing
this transition is a challenge for economic planners, the growth represents a
continuing opportunity for Indian industry. Domestic demand is buoyant, as are
exports. The investment rate is growing steadily. The economy is becoming more resilient.
India's global takeovers are a pointer that the country is now a contender to
reckon with in the international arena. However, infrastructure / power
constraints remain and inflation though manageable, is a cause for worry to
Indian economic planners.
The Indian financial sector is now becoming globally competitive in terms of
product alternatives, across both debt and equity, available to domestic
companies. The strengthening of the rupee against the US dollar will have a
positive impact on project cost structures for investment domestically.
Overall, there
could be no better opportunity for India to unleash its potential.
MACRO-POINTERS PERTINENT TO THE COMPANY
The Oil and Gas sector is poised to change the very face of the Power, Chemicals
and Fertiliser industries. The large gas finds in the KG Basin are now not only
firmly established but are expected to be available by end-2008. Parallely, the
Dahej-Uran Pipeline is slated to be commissioned in July 2007 opening up the
connectivity for LNG and Natural Gas from the PMT fields. Thus the Company's
perennial issue of gas shortage now sees light at the end of the tunnel.
A boom in the
Infrastructure sector and growth trends in the mining sector have propelled a
strong positive thrust for commercial explosives. India's huge power needs will
also require a massive focus on coal mining. These macro-pointers going forward
spell a positive story for their Ammonium Nitrate business.
The retail boom
is now spreading fast to every corner of the country.
Alongside, an
organised supply chain from farm-to-fork is also emerging.
This ensures
that quality fruits and vegetables reach very quickly from the farm gate to the
retail shelves. This macro-shift opens new doors for customised fertilisers and
agri-services for the Company.
Finally, the
consumer boom propelled by higher disposable incomes continues as does the boom
in housing. This means a greater demand for better designed homes and spaces,
differentiated products and a need for convenience. Thus, alongside the mall
mania in conventional retail, a new trend of the speciality mail, offering
focused shopping experiences in the form of marriage malls, automobile malls,
etc. is emerging. The Company's Speciality Mall and Design Centre, Ishanya, is
clearly a move in the right direction.
THE AGRI-BUSINESS
No significant
change has emerged in Government policy for this sector.
Though the
current policies are not ideal to maximise economic gains and efficiencies, they
are a reality that has to be factored into any plan for this sector.
The future will
demand not just customised nutrients and micro-nutrients for Indian soils that
enhance agricultural productivity and enable quality-driven, precision farming,
but also further downstream resources like the augmentation of global market
access to farmers. The Company is now beginning to play this role through a
combination of in-house marketing and outsourcing, with the Mahadhan Saarrthie
initiative as the key vehicle capitalising on the opportunity in this sector.
Mahadhan Saarrthie centres are working as high quality knowledge bases for
farmers, providing both product and advisory services at a fee. The advisory
services, provided regularly, have enabled the farmer to grow global-class
products. Further linkages created by the Company with global importers and
exporters have opened up new markets for farmers driving better farm economics
and creating a new business model that the Company intends exploiting to the
fullest. The Company has taken the member farmers through the process of Eurep
GAP certification for the export of grapes. The certification is a must for
exports into Europe and is a key tool towards achieving their Saarrthie
strategy. The grape exports at the Pimpalgaon Saarrthie centre in Maharashtra
stands out particularly in this regard.
THE CHEMICALS BUSINESS
Industrial Chemicals:
India's
economic boom has positively impacted the Chemicals sector with demand rising.
On the other hand, with peak customs duties at 10% and duties for chemicals at
7.5%, India is fast becoming a significant market for global giants. The
Company remains among the leaders in this market, across all parameters, for
its products. Its current basket of chemicals viz. Methanol, Iso Propyl Alcohol
(IPA), various grades of Nitric Acids, Hydrogen and Carbon Dioxide provide the
Company with considerable product flexibility to manage commodity market cycles
efficiently. The Company enjoys strong customer relationships and loyalty.
The Company's moves to strategically combine products, value-add
techno-commercial services and create brands should enable considerable market
advantages in the coming years. The Company's initiative to supply select
chemical products like Methanol and IPA in drums has been implemented and
customised packaging is now available. This has been very well received by the
market, as have been the customised grades of Nitric Acid that the Company is
supplying.
The global
Methanol market over the last calendar year has seen considerable swings. New
capacities have come up globally and more are expected. Prices have plateaued
at levels that are lower than the average price levels obtained in 2006.
India's domestic demand for Methanol has grown and is likely to grow at a
healthy pace. The Company will consolidate and further augment the marketing
and distribution strengths in this business.
The Iso Propyl
Alcohol market is expected to see prices stable in the short-term. The Company
has now clearly emerged as the producer and marketer of choice in India.
Further details are available elsewhere in this Report.
Ammonium Nitrate:
The Ammonium
Nitrate (AN) market in India is closely linked to the growth in infrastructure
and mining. Given the growth rates expected in the economy, these two sectors
stand to benefit considerably. Current domestic market growth rates hover
around the 6 to 7 percent mark and will further improve as the demand for coal
to feed the power sector goes up. The Company is the acknowledged market leader
in this product for its ability to offer not just the widest range of products,
from melt to low density porous prills, but its services and knowledge skills
that drive precision blasting yielding better economics to AN users.
Initiatives to create and augment its brands through a strategic,
customer-centric mix of products and services are well underway and should
benefit the Company strongly in the future.
Ammonia:
As a strategic back-up to gas, the Company has also taken up a project to build
a shore-based Ammonia storage tank. This will open up one more avenue for
supplies of a key raw material for the Company. Huge new Ammonia capacities in
the Middle East are fast coming up and this is likely to soften prices, which
could be an advantage for the Company.
Retailing / Value-Added Real Estate:
The Company's
initiative to identify the speciality retail segment of the market as a growth
driver three years ago is showing results. The overall interiors and exteriors
market that the Company has focused upon through its Design Centre and
Speciality Mall, Ishanya, is growing at around 8 percent annually, a growth
rate that is faster than most other segments of retail trading.
Ishanya is
already a well-recognised brand among key segments of the interiors and
exteriors industry. Options are being explored to leverage these brand
strengths in a direction which will provide not just synergies but add further
luster to the Ishanya brand, while capitalising on the huge opportunity
emerging in the interior and exterior segments and in the design industry. More
details on the progress of Ishanya are available elsewhere in this
report.
Management Practice and Systems:
The Company has
received the ISO 9001:2000 certification for the manufacture and supply of Methanol
and Iso Propyl Alcohol in March 2007.
Considerable
progress has been made in implementing global class Human Resource practices
and enhancing productivity. Training programme in SAP with a focus on enhancing
information flows and productivity, besides training programmes for a new
employee engagement thrust titled KSH were a key part of the HR initiatives for
the year FY07. KSH is a movement that combines the Kaizen initiatives of TQM
with Small Group Activity and Housekeeping to create an energising force within
the Company.
The aim is to
make the Company a highly competitive, learning organisation, fully capable of
meeting emerging global challenges effectively.
THE YEAR UNDER REVIEW
Financial Analysis:
The financial
year 2006-07 (FY07) has been a record breaking year for the Company with
unprecedented topline and bottomline growth levels, despite constraints of
feedstock availability. The growth has been achieved by deft capitalisation on
market opportunity through a combination of in-house manufacturing and
strategic outsourcing.
Total Revenues for the financial year 2006-07 (FY07) jumped to Rs.8694.300
Millions from Rs. 5954.900 Millions in the financial year 2005-06 (FY06).
Profit Before Tax rose to Rs.1283.900 Millions in FY07 from Rs. 1117 Millions
in FY06.
Net Profit for
the year FY07 stood at Rs. 929.300 Millions against Rs.797.700 Millions in
FY06. Earnings per share, as a consequence, has grown from Rs.9.04 in FY06 to
Rs. 10.54 in FY07.
Operational
Analysis:
The supply of Natural Gas, the key feed stock to the Taloja
plant in Maharashtra, continued to be short of requirements. The shortfall in
feedstock was met through a strategy of outsourcing Ammonia for maintaining
manufacturing levels. Prices of both Naphtha, which is used for heating and
steam generation and precious metals used as catalysts rose.
Overall
Production and Sales:
The total fertiliser sales volumes for FY07 increased to 3,68,723 MT from
2,65,222 MT in FY06, while industrial chemicals grew to 2,64,006 MT in FY07
from 2,50,334 MT in FY06.
With its strong brand strengths and its new thrust in agri-services through the
Mahadhan Saarrthie model, the Company saw record growth in sales of
fertilisers. A strong momentum across the industrial chemicals and AN segments was
maintained. IPA also provided a good boost to the industrial chemicals
business. The Company manufactured IPA has a high level of acceptance in the
domestic and global markets and would be a strong topline and bottomline driver
in the future.
SEGMENT-WISE AND PRODUCT-WISE BUSINESS
AGRI-BUSINESS:
Driven
by the strategy of providing comprehensive soil nutrients, micro-nutrients,
advisory services to the farmers, the Company has seen record sales growth in
this business. Though this resulted in a higher volume of outsourced
fertilisers, considerable brand strengths and customer loyalty across the
farmer base have been created. For the year under review sales of outsourced
fertilisers increased 42% from 2,11,944 MT in FY06 to 2,99,941 MT in FY07. Two
Mahadhan Saarrthie centres were created during FY07, bringing 2,500 farmers and
7,500 acres of land now under the Saarrthie umbrella. The production of Nitro
Phosphate fertiliser (23:23:0) remained affected owing to a shortage of key
feedstock.
CHEMICALS SEGMENT
Methanol:
Methanol production improved marginally in FY07 as compared to FY06. The volume
of traded Methanol stood at 47,016 MT in FY07 against 59,677 MT in FY06.
The Company was
able to reap considerable advantages from the uptrend in global Methanol
prices. While the production of Methanol manufactured in-house was higher than
FY06, overall Methanol sales were lower due to several factors that were at
play globally. With Methanol prices at an all time high in the last
quarter of calendar year 2006, availability worldwide was restricted, and
product outsourcing opportunities were not optimum.
This had its
impact on the import of the Methanol into India. In the last quarter of FY07,
however, prices corrected to normal levels.
Iso Propyl Alcohol:
The Company
commissioned its IPA plant in August 2006. Since then 11,146 MT of the product
have been sold in the domestic market and 1,405 MT have been exported. Sales
figures would have been higher but for a fire at a key supplier's plant in October
2006, which caused more than 30-days disruption for want of feedstock
Propylene. The product's acceptance in terms of both quality and the service
levels obtainable from the Company has been very heartening.
Acids:
Sales volumes in acids grew 8% for FY07 over FY06 to 1,14,855 MT. The overall
sales in value terms went up 14% in FY07 against FY06.
Ammonium Nitrate:
Driven by
growth in mining, construction and infrastructure demand for Ammonium Nitrate continued
to be strong. Overall sales volume grew 6% over the previous financial year.
The Company sold higher volumes of value-added prilled product, riding on its
strong OPTIMEX brand, backed by high levels of techno-commercial services with
higher margins.
Liquid Carbon Dioxide:
The total sales
volume of C02 was 5.78% higher over FY06. The Company has now made a strong
foray and acceptance into the food and beverages market with this product which
is certified by the world's best food testing laboratories M/s. TNO of The
Netherlands.
Hydrogen:
The volume sales for Hydrogen, which is a byproduct, improved by 37% for FY07
over FY06.
Exports:
With
the thrust provided, exports of AN for the year under review was Rs. 124.100
Millions, a growth of 15.98% over the previous financial year. Exports of IPA
stood at Rs. 56.800 Millions. The Company has now established a global market
for this product. Nitric Acid exports value grew by 59%.
CURRENT AND FUTURE PROJECTS
Retailing / Value Added Real Estate:
Ishanya's
campus-like design, with 5,50,000 square feet of leasable space, spread over
10-acres will, besides having retail spaces, offer exhibition halls, an
amphitheater, a design studio, a training and development centre, art
galleries, business center, ample parking, etc. Restaurant and food courts will
also be available.
Ishanya, is
emerging as India's largest Design Centre and Speciality Mail and has already
leased out over 75% of space at the end of FY07. A shift in the opening of the
mall has been necessitated due to a severe shortage of available labour for
construction activity in Western India.
Ishanya's features permit an augmentation of revenue streams beyond lease
rentals and provide a strong cushioning and enhanced brand value for the future.
As of date, tenant fit-outs are in full swing. Nearly 2,10,000 square feet of
space have already been handed over and Ishanya is expected to commence
operations in a phased manner from Q2 of FY-08, well in time to catch the
festival season.
Ammonium Nitrate:
The initiative
to set-up an integrated green-field complex for Nitric Acid and AN at Paradeep
in Orissa, in Eastern India, is proceeding well despite a few delays on land
procurement given the complex nuances of this issue in India. Technology and
engineering tie-ups and ordering of long delivery equipment are underway.
Ammonia Storage Tank:
The Company's
15,000 MT storage tank project for Ammonia at JNPT is progressing well. The
turnkey contract has already been awarded and major long lead items have been
procured. The tank is expected to be commissioned around mid-2008. The
environmental clearances required are in process of being obtained.
Fixed Assets
Ø Land
freehold
Ø Land
leasehold
Ø Buildings
Ø Plant
and machinery
Ø Electrical
installation and fittings
Ø Furniture
and fixtures
Ø Office
equipments
Ø Vehicles
Its’ products range includes :-
- Ammonia
- Methanol
- Dulute Nitric Acid (DBA)
- Concentrated Nitric Acid (CAN)
- Liquid Carbon-di-oxide (CO2)
- LDAN
- Nitro Phosphate (NP)
- MOP
- DAP
- Ammonium Sulphate
- Mixtures
- Urea Seeds
- Sulphur
- Micronutrients
- SSF
- Traded Bulk Fertilisers
- Traded
Speciality Agro Products
AS PER
WEBSITE
Introduction
The Deepak Group of industries was born in 1970 when Mr. C. K. Mehta set up Deepak
Nitrite Ltd, combining his skills in trading and manufacturing. The company
grew by leaps and bounds, surpassing expectations of all investors and also won
many prestigious awards like the Sir P.C.Ray award, for being the best Chemical
Industrial unit in India.
In 1983, Deepak Fertilisers and Petrochemicals Corporation
Limited (DFPCL) started commercial production of ammonia (in technical
collaboration with Fish International Engineers (USA)) using natural gas as
feedstock. This marked the fulfillment of a need for lateral integration into
the world of basic building block chemicals, premium fertilisers and
petrochemicals. At the time, this was India's only merchant ammonia
manufacturer. The International Finance Corporation initially supported this
venture of Deepak group in the form of equity participation in DFPCL.
The company undertook major expansion and diversification in
1989 to achieve forward integration of ammonia and diversification in Methanol.
In July 1992, DFPCL commenced commercial production of Low
Density Ammonium Nitrate (LDAN), Nitro Phosphate (NP), Dilute Nitric Acid
(DNA), and Concentrated Nitric Acid (CNA).
This has resulted in a multi-product portfolio for DFPCL
consisting of chemicals, petrochemicals, fertilisers and other agri-inputs. To
ensure an uninterrupted supply of natural gas to its plant, DFPCL laid its own
43 km gas pipeline from the coastal fall point of Bombay High to its plants in
Tajola, thus becoming one of the first companies in India to have its own gas pipeline.
DFPCL has a chemical storage terminal at Jawarharlal Nehru
Port Trust (JNPT) to provide support to its logistics management system and
ensure a window to the world trade in chemicals. It is in the process of adding
new storage facilities for Ammonia, Methanol and other products. The company
also leases port storage capacities at Bombay Port Trust and Vishakhapatnam.
DFPCL's business can be broadly categorised into : -
- Chemicals
- Agribusiness
Chemicals: This
division of DFPCL manufactures Methanol, various grades of Nitric Acid and
Ammonia. DFPCL is one of the largest producers of Methanol in India, which in
turn is used to manufacture drugs, pharmaceuticals, DMT, pesticides,
methylamines, formaldehyde, etc. DFPCL is also one of the largest manufactures
various concentrations of Nitric Acid (60%, 68%, 72% and 98%). Ammonium
Nitrate: The explosives division manufactures Low Density Ammonium Nitrate,
which is used for making Ammonium Nitrate-fuel oil (ANFO), blasting agents and
also emulsified ANFO (HANFO). DFPCL is the largest manufacturer of ammonium
nitrate in India (capacity expanded to 100.000 tpa in September 2002), and the
only one making prilled Ammonium Nitrate (AN).
Agribusiness : This
division of DFPCL manufactures 23:23:0 prilled Nitrophosphate fertiliser under
the brand name Mahadhan. DFPCL markets Mahadhan through a network of over 1000
dealers.
Ishanya: Ishanya
is India's first International Design Centre and Speciality Mall - a centre for
excellence in space design and the one-stop shop for interior and exterior
products.
For architects and interior designers, Ishanya is a platform
to showcase their art, craft and vision to a targeted and discerning audience.
For manufacturers and retailers of interior and exterior products, it's the
perfect marketplace to make the most of India's real estate and construction
boom. For homeowners, corporate shoppers and visitors, Ishanya will provide the
ultimate experience in shopping for the home.
Social Responsibilities
The Deepak Group has been contributing towards social causes for nearly two
decades. The Deepak charitable Trust (DCT) and the Deepak Medical Foundation
(DMF) with the support of DFPCL and Deepak Nitrite Limited are carrying on
development activities for society.
DCT has been actively working in the area of mother and
childcare. Through an integrated network of women health workers the foundation
has been imparting training and communication on health care. Extending the
activities on both sides, the Foundation has catalysed and supported the
creation of Aanganwadis, and taken education to youth on family planning. The
Foundation is now working to curtail the spread of HIV / AIDS.
DFPCL takes an active interest in environmental protection.
In addition to regulatory requirements of the State Pollution Boards and
Federation of Indian Industries, care is taken to reduce pollution by
incorporation of appropriate effluent handling disposal systems.
In their plants they continuously monitor solid, semisolid
and gaseous affluent discharges to ensure that they are within allowable
limits. They also help other small industries as well as customers in solving
their environment- related problems.
Future Prospects
DFPCL will continue to make deeper inroads into value-added chemicals, agro
inputs and related services.
·
DFPCL plans to leverage its well-knit marketing and
distribution network in chemicals and fertiliser industry to provide
value-added services to their customers for sourcing raw materials and
assisting them in exporting their products. The chemical storage and drumming
facilities at Jawaharlal Nehru Port (JNPT) near Bombay will provide further
value-added services.
·
They are awaiting environmental clearance for a new port
storage facility at JNPT.
·
Deeper in-roads into agro-inputs and services markets are on
the drawing board, including the MAHADHAN Agriculture Research Centre (MARC),
which will serve to partner with farmers, providing education, training and
ensuring that they achieve the best performabce
- Dreams of visionary minds and planned strategy by professional
managers will give shape to an emerging, exciting future at DFPCL.
Industrial Chemicals
Deepak Fertilisers and Petrochemicals Limited is one of the
leading producers of industrial chemicals like Ammonia, Methanol, various
grades of Nitric Acid and liquid Carbon Dioxide in India.
Products
The industrial chemical products manufactured by the Company at their
state-of-the-art plants meet international quality standards and have been well-received
in the domestic and international markets:
·
Methanol
·
Nitric Acid
·
Liquid Carbon Dioxide
·
Isopropyl Alcohol
Customers
The industrial chemicals division caters to a cross-section of industrial
customers, both small and large. These include all the major companies in
pharmaceuticals, DMT, pesticides, resins, textiles, fertilisers, rubber,
petrochemicals, fibres and polyester sectors.
There are several reasons why quality conscious and
professional organisations prefer to deal with DFPCL:
Service
Unlike traders, DFPCL is always there to serve its customers. They deliver
seven days a week, 365 days a year (except for four hours during the
presentation of the Union Budget every year).
They have two shift (sixteen hours) loading, so that they can
offer the quickest turnaround time to their customers.
Logistics
They have storage facilities at the factory (Taloja), Mumbai port and
Vishakapatnam port. This allows they to deliver to you, across the country,
enabling you to benefit from the optimum logistic solution.
Consistency
Regardless of domestic supply constraints, they can deliver to you,
consistently, every day, all year round. This is thanks to their unique
capability to manufacture locally as well as to import and store at major ports
on the East and West coasts of India. This provides customers with a seamless
supply, at optimum prices, regardless of disturbances in either local or
imported supply.
Private Sector Efficiency
Being the only private sector manufacturer they value the importance of
service, timeliness and efficiency. They know exactly how valuable their
customer's time is, and are approachable, flexible and responsive to their
needs.
PRESS
RELEASE
Deepak Fertilisers And Petrochemicals plans
major investment in chemicals riding on Mining and Construction sector growth
• Expanding its thrust into the Chemicals
Sector
• Major expansion in Ammonium Nitrate with an
investment of about Rs..4000 millions (about US $ 90 million)
Mumbai,
October 21, 2005: Deepak Fertilisers and Petrochemicals
Corporation Limited (DFPCL) today announced a major expansion plan in the
Chemicals Sector to set up a 3,00,000 Metric Tonnes Per Annum green-field
complex for Nitric Acid and Ammonium Nitrate in Eastern India. The project will
be set up with an investment of about Rs. 4000 millionss (approx. US $ 90
million) and will primarily be focussed on the needs of the mining and
construction sectors in the domestic and global markets. The new plant is
expected to be set up in about 24 months time.
The new project in Eastern India
will augment DFPCL’s geographical reach cost-effectively across the country and
strengthen its position as the market leader. The DFPCL brand Optimex is
India’s leading brand in the AN market, where the Company has already sold more
than a million tonnes of the product over the last decade or so.
Ammonium Nitrate is used
extensively in the mining and construction sectors, all of which are in a
strong growth phase that is expected to continue as the Indian economy
strengthens. Domestic demand is rising at about 5 % annually while demand in
the international markets is also growing fast.
The Company already has a
prilled Ammonium Nitrate facility with a capacity of 90,000 tonnes at Taloja,
near Mumbai, in Western India. The Company’s 100 % subsidiary, Smartchem
Technologies Limited, also has two plants with a total capacity of 50,000
tonnes in Andhra Pradesh in Eastern India and in Gujarat in the west of the
country.
“DFPCL has over two decades of
proven strengths in the field and is known for its strong technology and
project management skills. The new capacity expansion will propel the Company
into a new high growth phase. Their strong techno-commercial skills, coupled
with their new capacities, will continue to be at the forefront of
customer-led, technology-driven strategy. They are focussed on providing
optimal world class blasting solutions to their customers,” Mr. S. C. Mehta,
the Company’s Managing Director said.
The Company has over the last two decades acquired and
absorbed the world’s leading technologies involved for the products –
Stamicarbon, Grande Paroisse and Norsk Hydro (which is being used at Smartchem
Technologies). The Company’s current AN operations benchmark very favourably
with world standards across all parameters for the manufacturing and handling
of the product.
The Company registered strong growth in sales and profits
for the six-month period ended September 30, 2005. The Company saw a 16 % growth
in sales from Rs.. 2160 millions to Rs.. 2490 millions. Profit Before Tax
jumped by 21 % from Rs. 445.0 millions to Rs. 54 millions, while Profit After
Tax increased from Rs. 290 millions to Rs. 370 millions, a jump of 27 %. The
Company’s Chemicals business saw a 15 % growth during the first half of
2005-06, while the Agri-services business, including Fertilisers, registered a
growth of 8%.
Deepak Fertilisers and Petrochemicals Corporation Limited
Topline grown 18% in 2005-06
- Company announce dividend of 30%
- Net Sales for 2005-06 at Rs. 5628.600 millions, riding on strong
growth in price realisations across key products.
- Net Profit at Rs. 797.700 million
- EPS stays steady at Rs. 9.04
- IPA project ready for commissioning in the first quarter of 2006-07
May 18, 2006 : Deepak Fertilisers and Petrochemicals
Corporation Limited showed strong 18%
growth in its Net Sales to Rs. 5628.600 millions for the year ended 2005-06
from Rs. 4781.700 millions in 2004-05. the company announced a dividend of 30%
for the year.
The sales growth
came on back of higher sales volumes in fertilisers and industrial
chemicals. The total fertiliser sales volumes for FY 06 increased to 265200
from 186700 MT in FY05, while Industrial Chemicals grew to 250400 MT in FY06 from
239700 MT in FY05.
DFPCL’s strategy of foucsing on total nutrients management
in order to provide the farmer with soil and plant specific needs calls for
outsourcing soluble fertilisers, micronutrients and secondary nutrients that
its does not currently manufacture. This focus has resulted in a higher volume
of outsourced fertilisers, which for the year under review was up by 84% in
FY06 over FY05.
In the industrial Chemicals segment, sales volumes of
outsourced products rose by 57% in FY06 against FY05 on account of a lower
production necessitated by the flash floods in Western Maharashtra toward the end of July 2005. The outsourcing
was necessary in order to maintain market share and customer loyalty.
Sales volumes for Ammonium Nitrate stood at 102100 MT during
the year under review comparable to the previous financial year (FY05). The
lower production due to the flash floods in end July 2005 was compensated by
outsourcing 4000 MT of Ammonium Nitrate.
The company strong brand and marketing strengths are
enabling it gain higher price realizations across its key products, especially
Ammonium Nitrate and Nitric Acid.
The GAIL pipeline from Dahej to Uran is expected to be
complete around February 2007. This will provide the company’s Taloja plant with
sufficient quantities of LNG and ensure higher capacity utilisation and
contribution.
Profit before tax stood at Rs. 1117 million in FY06 against
Rs. 1124.600 million in FY05. Net Profit for the year FY06 stood at Rs. 797.700
millions against Rs. 797.500 millions in FY05. Earnings per share was steady at
Rs. 90.400 in FY06 the same level as FY05.
Sales for the fourth quarter of FY06 stood at Rs. 1701.600
millions up from Rs. 1447.400 millions for the corresponding quarter in the
previous financial year. Net profit for the periods QIV 2005-06 stood at Rs.
268.300 millions against Rs. 276.900 millions for the corresponding period in
the previous financial year (2004-05).
Profits did not move in line with sales largely due to the
rise in outsourced products, which were necessitated by lower production and
the need to maintain marketshare and customer loyalty.
The company is confident of its demonstrated ability to grow marketshare, manage its production
costs efficiently and gradually realise price hikes, all of which should stand
it in good stead in the future.
DFPCL has made a strong foray into agri-services, offering
integrated or total nutrients management to the farmer. The company has set up
two centres in Maharashtra that offer more than just fertilisers. The centres
have been branded “Mahadhan Saarrthie” . Each
“Mahadhan Saarrthie” centre aims to provide total agri-services and
solutions through soil, water plant testing facilities and crop nutritional
managements, utilising DFPCL’s range of plant nutrient products and ultimately,
providing the farmer marketing linkage for his farm produce with product buy
back and retailing. The crops selected for this purpose are potato, tomato and
grapes. two pilot projects have been undertaken so far and over 1000 farmers in
Maharashtra and 3000 acres of land brought under the “Mahadhan Saarrthie”
umbrella. This represents a major strategic thrust for DFPCL.
The company Mahadhan and Bhoodhan brands are amongst the
leaders in terms of brand recognition within their geographical and customer
markets. With this base, DFPCL is now leveraging its strengths in marketing,
and brand extensions with enhanced potash, sulphur, and phosphorous have been
introduced in the last few years with good success.
The company’s Iso-Propyl Alcohol project is slated to go
online in the first quarter of 2006-07 and current IPA prices show a firm
trend. Ishanya, India’s first Design Centre and Mall, had leased out over 60
percent of its 550000 sq. feet leasable area as of date.
DFPCL’s 300000 MT Ammonium Nitrate project at Paradip in
Orissa is going ahead as planned. The Nitric Acid plant for the project has
arrived at the plant site and is ready for erection. The detailed engineering
design contract and key technology supply contracts have been signed.
For further details contact :
Vivek Y. Kelkar
Vice – President – Communication
Tel : 91-20-26684916 / 91-9820210514
Sonia Kulkarni / Rohan Sukthanka
Adfactors PR
Tel : 91-9820401304
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 :
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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.39.27 |
|
UK Pound |
1 |
Rs.77.44 |
|
Euro |
1 |
Rs.57.73 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
8 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--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 |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
72 |
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 |
|