MIRA
INFORM REPORT
|
Report Date : |
23.01.2008 |
IDENTIFICATION
DETAILS
|
Name : |
AIR DECCAN – A UNIT OF DECCAN AVIATION LIMITED |
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Registered Office : |
35/2, Cunningham Road, Bangalore-560 052, Karnataka |
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Country : |
India |
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Financials (as on) : |
30.06.2007 |
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Date of Incorporation : |
15.06.1995 |
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Com. Reg. No.: |
018045 |
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CIN No.: [Company
Identification No.] |
L85110KA1995PLC018045 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
BLRD00795E |
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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 : |
Engaged in Chartered Aviation Services for Commercial and Non-Commercial
purposes in India. It also engaged in Technical Services, Training and
Aviation related services. |
RATING &
COMMENTS
|
MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Maximum Credit Limit : |
USD 14947000 |
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Status : |
Satisfactory |
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Payment Behaviour : |
Slow |
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Litigation : |
Clear |
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Comments : |
Subject is a well-established and renowned player in the Indian
Aviation industry. Recently, UB Group Company, Kingfisher Radio Limited
bought 26% stake in the Company. The company faces cut-throat competition
from fellow players. Trade relations are fair. Business is active. The
company has some accumulated losses. Payments are reported as slow but
correct. The company can be considered normal for business dealings at usual
trade terms and conditions. |
LOCATIONS
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Registered/Repair
Facility Office : |
35/2, Cunningham
Road, Bangalore-560 052, Karnataka |
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Tel. No.: |
91-80-41148190-99 |
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Fax No.: |
91-80-22352645 /
41148849 |
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E-Mail : |
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Website : |
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Area : |
2000 Sq. ft |
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Location : |
Leased |
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Head Office : |
Jakkur Aerodrome,
Bellary Road, Bangalore – 560064, Karnataka, India |
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Tel. No.: |
91-80-8561378/79/3524/24 |
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Fax No.: |
91-80-8563525/2996529 |
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E-mail : |
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Website : |
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Area : |
5000 Sq.ft |
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Location : |
Owned |
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Factory 1 : |
Air Deccan,
214/33, 7th Cross, Cunnigham Road Cross, Vasanthnagar, Bangalore –
560052, Karnataka, India |
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Tel. No.: |
91-80-56995760/2352646 |
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Fax No.: |
91-80-2352645 |
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E-Mail : |
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Website: |
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Area : |
1500 Sq.ft |
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Location : |
Rented |
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Branches : |
Ø
C/o. MISL
Cargo Complex, Airport Exit Road, Bangalore – 560017, Karnataka, India Tel. No. 91-80-56995760 Fax No. 91-80-2352645 Ø
202, Elegant
Apartments, Raj Bhavan Road, Hyderabad – 500482, Andhra Pradesh, India Tel./Fax No. 91-40-23308713 Mobile : 9849026113/9849026114 E-mail : decanhyd@satyam.net.in Ø
10, Avatar,
27, Balakrishna Road, Chennai – 41, Tamil Nadu, India Tel. No. 91-44- 24454110/3445 Fax No. 91-44- 24457215 Ø
E-54, Anand
Niketan, New Delhi – 110021, India Tel. No. 91-11-24103521/21 Fax No. 91-11-24103522 E-mail : deccan@mantronline.com Ø
Near Bombay
Flying Club, Juhu Aerodrome, Mumbai – 400049, Maharashtra, India Tel. No. 91-22-25704517 Mobile : 9820231665/67 Ø
Jakkur
Aerodrome, Bellary Road, Bangalore – 560064, Karnataka, India Tel. No. 90-80-8567523/8567378 E-mail : deccanair@vsnl.com Ø
Hanger # 8,
Juhu Aerodrome, Mumbai – 400049, Maharashtra, India Tel. No. 91-22-26611601 E-mail : daplmum@vsnl.net Ø
#32, 92nd
Street, 18th Avenue, Ashok Nagar, Chennai – 600083, Tamil Nadu,
India Tel. No. 91-44-24740560/24714109 E-mail : deplchennai@satyam.net.in Ø
Room # 605,
Hotel Yuvraj Palace, Doranda, Ranchi – 834002, Bihar, India Tel. No. 91-651-2480377/2480326 E-mail : deplranchi@yahoo.co.in |
DIRECTORS
|
Name : |
Captain G. R. Gopinath |
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Designation : |
Managing Director |
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Address : |
G-3, Garden Apartments, Vittal Mallya Road, Bangalore – 560001,
Karnataka, India |
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Date of
Birth/Age : |
23.04.1951 |
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Date of
Appointment : |
19.06.1995 |
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Name : |
Captain K. J. Samuel |
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Designation : |
Director |
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Address : |
288 A, 8th Block, Koramangala, Bangalore – 560095,
Karnataka, India |
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Date of
Birth/Age : |
09.04.1951 |
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Date of
Appointment : |
19.06.1995 |
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Name : |
Lt. Gen. N. S. Narahari |
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Designation : |
Chairman |
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Address : |
21, 3rd Cross, Saint Thomas Town, Bangalore – 560084,
Karnataka, India |
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Date of
Appointment : |
01.06.1995 |
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Name : |
Mr. A. D. Sinha |
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Designation : |
Director |
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Address : |
609, Manipal Centre, Dickenson Road, Bangalore – 560042, Karnataka,
India |
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Date of
Appointment : |
01.06.1995 |
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Name : |
Mr. S. N. Ladhani |
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Designation : |
Director |
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Address : |
5/1, I Main, Jayamahal Extension, Bangalore – 560046, Karnataka,
India |
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Date of
Appointment : |
01.06.1995 |
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Name : |
Mr. Vijay Amritharaj |
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Designation : |
Director |
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Name : |
Col (Retd) Jayanth K Pooviah |
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Designation : |
Director |
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Name : |
Mr. Sudhir Choudhari |
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Designation : |
Director |
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Name : |
Mr. P.N. Thirunarayana |
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Designation : |
Director |
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Name : |
Mr. Anil Kumar Ganguly |
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Designation : |
Director |
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Name : |
Mr. Vishnu Singh Rawal |
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Designation : |
Director |
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Name : |
Dr. Vijay Mallya |
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Designation : |
Vice – Chairman |
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Name : |
Mr. M G Mohan Kumar |
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Designation : |
Director-Finance |
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Name : |
Mr. Vivek Kalra |
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Designation : |
Director |
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Name : |
Mr. A K Ravi Nedungadi |
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Designation : |
Director |
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Name : |
Mr. Hitesh Harshad Patel |
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Designation : |
Director |
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Name : |
Mr. Bala Deshpande |
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Designation : |
Director |
KEY EXECUTIVES
|
Name : |
Mr. N Srivatsa |
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Designation : |
Company Secretary |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
Shareholding Pattern as on 30.06.2007
|
Category |
No. of Shares |
Percentage of
Holding |
|
Ø Promoters |
22162500 |
16.37 |
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Directors and Relatives |
911850 |
0.67 |
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Mutual Funds / UTI / Financial Institutions / Banks / Insurance |
10133670 |
7.48 |
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Venture Capital Funds |
9999206 |
7.38 |
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Foreign Institutional Investors |
7877356 |
5.81 |
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Ø Bodies Corporate |
64454566 |
47.58 |
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Indian Public and Trusts |
12502118 |
9.23 |
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NRIs / FNs / OCBs |
5465212 |
4.03 |
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Foreign Bank |
1963640 |
1.45 |
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135470118 |
100.00 |
Note:
Ø Kingfisher Radio Limited, a UB Group company acquired 26% in the share capital
of the company and 35222231 equity shares of Rs.10/-each were allotted to them
on 30th June 2007. Consequently in terms of the subscription and
shareholders agreement dated 26th June 2007, kingfisher radio
limited (KRL) and or any other person including (UB Overseas Limited) nominated
by KRL to subscribe to the investment shares and/or acquire open offer shares
in accordance with the terms of the agreement and United Breweries (holdings)
Limited (UBHL) and any transferee being member of the UB Group, collectively
referred to as the investor Group are to be acknowledged as Co-Promoters of the
Company. However the said shareholding of KRL amounting to 26% is reflected in
the above table in bodies corporate as on 30th June 2007 in
anticipation of the resolution of the Board of Directors acknowledging the
Investor Group as Co-Promoters.
BUSINESS DETAILS
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Line of Business : |
Engaged in
Chartered Aviation Services for Commercial and Non-commercial purposes in
India. It also engaged in Technical Services,
Training and Aviation related services. |
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Imports : |
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Countries : |
USA, Europe |
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Terms : |
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Selling : |
Cash or Credit
(30 days) terms. |
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Purchasing : |
Credit (30 to 60
days) terms. |
GENERAL
INFORMATION
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Suppliers : |
Airbus, France |
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Customers : |
Retailers and End
Users v
Wipro Group,
India v
TATA Group,
India v
ICICI Bank/
ICICI Group, India |
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No. of
Employees : |
3058 |
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Bankers : |
v
Bank of India,
Main Branch, K. G. Road, Bangalore – 560009, Karnataka, India v
ICICI Bank
Limited, Bangalore v
Citi Bank v
Deutsche
Bank v
Development
Credit Bank v
Indus Ind
Bank v
Punjab
National Bank v
State Bank
of India v
State Bank
of Indore v
State Bank
of Travancore v
United Bank
of India |
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(Rs. In Millions) |
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Facilities : |
Notes: v
Term loans
from banks and cash credit facility from banks are secured by a first charge
on the current assets and fixed assets of the Company, including hypothecation
of the present and future goods and including book debts, and documents of
title to goods and collateral security of personal property of relative of
directors. v
Further,
term loans of Rs.1720.642 Millions (June 30, 2006 – Rs.1310.280 Millions) are
secured by the assignment of the aircraft purchase agreement entered into for
purchase of aircraft and by personal guarantee of directors. v
Short term
loans from banks during the year are secured by lien on fixed deposits and
during the previous year secured by first charge on all stock in trade both
present and future and all the present and future book debts of the Company v
Vehicle
loans are secured by the hypothecation of the respective assets. v
Finance lease
is secured by the hypothecation of the respective assets. v
Hire
purchase loans are secured by the hypothecation of the respective assets. v
Term loan of
Rs. 671.017 Millions from a financial company is secured by the hypothecation
of the aircraft and helicopter, assignment of documents of title to such
asset and personal guarantee of one of the directors. v
Term loan
(foreign currency) of Rs.71.052 Millions from a financial institution is
secured by a second priority on the mortgage of the aircraft obtained on hire
purchase. v
Amounts
repayable within one year Rs.1695.569 Millions (June 30, 2006 – Rs.1703.285
Millions) |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
B K Ramadhyani
and Company Chartered Accountants
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|
Address : |
4B, 4th
Floor, 68, Chitrapur Bhavan, 8th Main, 15th Cross,
Malleshwaram, Bangalore-560 055 |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
150000000 |
Equity Shares |
Rs.10/-Each |
Rs.1500.000Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
135470118 |
Equity Shares |
Rs.10/-Each |
Rs.1354.701Millions |
Notes:
Out of the above 27284390 equity shares of Rs.10/-Each
(June 30, 2006 -27284390 equity shares of Rs.10/-each) have been allotted as
fully paid up bonus shares by capitalization of securities premium of
Rs.253.750 Millions (June 30,2006 – Rs.253.750 Millions) and balance in Profit
and Loss Account of Rs.19.093 Millions (June 30, 2006-Rs.19.093 Millions)
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
30.06.2007 |
30.06.2006 |
31.03.2005 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
1354.701 |
981.800 |
161.990 |
|
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
10168.677 |
1183.700 |
159.880 |
|
|
4] (Accumulated Losses) |
(7786.542) |
0.000 |
(445.600) |
|
|
NETWORTH |
3736.836 |
2165.500 |
(123.730) |
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LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
7167.092 |
4481.600 |
1594.170 |
|
|
2] Unsecured Loans |
2000.000 |
35.000 |
1250.600 |
|
|
TOTAL BORROWING |
9167.092 |
4516.600 |
2844.770 |
|
|
DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
|
|
Employee stock options outstanding (Net of deferred compensation cost) |
110.136 |
-- |
-- |
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TOTAL |
13014.064 |
6682.100 |
2721.040 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
3070.308 |
2309.300 |
2038.190 |
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Capital work-in-progress |
3576.198 |
2865.300 |
0.000 |
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INVESTMENT |
4.135 |
4.100 |
4.480 |
|
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DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
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CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
616.226
|
572.600
|
363.980 |
|
|
Sundry Debtors |
352.422
|
130.600
|
66.290 |
|
|
Cash & Bank Balances |
8170.495
|
2564.800
|
829.280 |
|
|
Other Current Assets |
157.757
|
0.000
|
131.920 |
|
|
Loans & Advances |
1339.855
|
2320.300
|
340.940 |
|
Total
Current Assets |
10636.755
|
5588.300
|
1732.410 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
4491.461
|
4416.400
|
1082.000 |
|
|
Provisions |
69.397
|
59.300
|
0.000 |
|
Total
Current Liabilities |
4560.858
|
4475.700
|
1082.000 |
|
|
Net Current Assets |
6075.897
|
1112.600
|
650.410 |
|
|
|
|
|
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|
MISCELLANEOUS EXPENSES |
287.526 |
390.800 |
27.960 |
|
|
|
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|
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TOTAL |
13014.064 |
6682.100 |
2721.040 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
30.06.2007 |
30.06.2006 |
31.03.2005 |
|
|
Sales Turnover |
17745.474 |
12364.000 |
|
|
|
Other Income |
3677.613 |
1154.100 |
|
|
|
Total Income |
21423.087 |
13518.100 |
3055.540 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
(4161.772) |
(3368.000) |
(181.130) |
|
|
Provision for Taxation |
33.989 |
37.500 |
14.190 |
|
|
Profit/(Loss) After Tax |
(4195.761) |
(3405.500) |
(195.320) |
|
|
|
|
|
|
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Export Value : |
3341.195 |
NA |
NA |
|
|
|
|
|
|
|
|
Import Value : |
1488.390 |
NA |
NA |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Manufacturing Expenses |
0.000 |
4720.700 |
1125.900 |
|
|
Administrative Expenses and Selling Expenses |
3610.981 |
3475.500 |
811.600 |
|
|
Interest and Financial Charges |
623.981 |
319.500 |
102.100 |
|
|
Employees Cost |
40.728 |
1617.100 |
311.900 |
|
|
Power & Fuel |
0.000 |
6254.500 |
929.800 |
|
|
Depreciation & Amortization |
176.688 |
133.400 |
30.600 |
|
|
Other Expenses |
21132.481 |
0.000 |
0.000 |
|
Total Expenditure |
25584.559 |
16520.700 |
3311.900 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
|
30.09.2007 1st
Quarter |
|
Sales Turnover |
|
|
4452.100 |
|
Other Income |
|
|
204.300 |
|
Total Income |
|
|
4656.400 |
|
Total
Expenditure |
|
|
6803.600 |
|
Operating Profit |
|
|
(2147.200) |
|
Interest |
|
|
241.300 |
|
Gross Profit |
|
|
(2388.500) |
|
Depreciation |
|
|
132.200 |
|
Tax |
|
|
11.100 |
|
Reported PAT |
|
|
(2531.800) |
KEY RATIOS
|
PARTICULARS |
|
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
PAT / Total Income |
(%) |
(19.58)
|
(25.19)
|
(6.39)
|
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
(23.45)
|
(27.24)
|
(5.92)
|
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
(39.12)
|
(42.64)
|
(4.80)
|
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
(1.11)
|
(1.55)
|
(1.46)
|
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
1.22
|
2.06
|
(31.73)
|
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.35
|
1.24
|
1.60
|
LOCAL AGENCY FURTHER
INFORMATION
Fixed Assets:
Tangible assets:
v
Land-freehold
v
Building on rented land
v
Building on freehold land
v
Building leasehold improvements
v
Improvements to leased aircrafts
v
Aircrafts
v
Plant and Machinery (Others)
v
Plant and Machinery (under finance lease)
v
Tools and Equipments
v
Helicopters
v
Computers
v
Office Equipments
v
Furniture and fixtures
v
Electrical Installations
v
Vehicles
Intangible assets:
v
Softwares
It is in trade terms with:
Ø
Aerial Camera
Systems, U.K.
Ø
Astra Zeneca
Ø
Badger Energy
/ Tractable
Ø
Bank of
America
Ø
British
American Tobacco/ITC
Ø
Discovery
Channel
Ø
ESPN
Ø
FIAT
Internationa
Ø
Hero Honda
Ø
Hindustan
Levers Limited
Ø
K Mart
Ø
Larsen &
Toubro
Ø
National Grid
Plc, U.K.
Ø
Nestle
Ø
Nortel
Networks
Ø
Reliance
Industries
Ø
Star TV
Ø
Sun Micro
Ø
Tata Group
Ø
TWI
Ø
Volvo India
Ø
World Bank
History:
Converted to Public
Limited Company on 5th March, 2005
“Air Deccan”
Services operative from During 2003
Air Deccan (Scheduled Airline Operations)
The company’s scheduled airlines business
continued to grow in all areas of its operations and your company is a
significant player in the Indian domestic aviation sector. It has also achieved
the distinction of becoming the carrier with the widest reach covering more
destinations than any other domestic carrier. Air deccan has succeeded in
changing the face of the market for air travel and has turned air travel into a
mass commodity.
Since inception, Air Deccan has:
v Carried approximately 12.500 Miilions passengers, till June 30, 2007 (up
from 5.6 Million as compared to June 30, 2006)
v Expanded its fleet to 41 aircrafts as on June 30 , 2007 (34 aircrafts as
on June 30 ,2006)
v Grown its schedule to 270 flights daily, as on June 30, 2007 (239 flights
as on June 30, 2006)
v Increased its route network to 63 airports as on June 30, 2007 (55
airports as on June 30 , 2006)
v Hired and mobilized a workforce of almost 3100 people as on June 30 ,
2007 (2600 as on June 30 ,2006)
Air Deccan, thus continues to be one of the fastest-growing
scheduled commercial passenger airlines today.
The company inducted 9 aircrafts (5 airbus,
A320s and 4 ATRs) and returned 2 ATRs during the period under review. The
domestic aviation industry continued to witness capacity expansion by all airline
operators and the competition continues to be stiff among all operators putting
pressure on yields. Added to this, the continued increase in fuel price during
the period (more than 9% on an average), increases in renumeration to skilled
personnel due to market factors, shortage of locally available skilled
personnel leading to recruitment of expatriate personnel, all combined to cause
an operating loss during the period under review. Individual items of the
financial statements are more fully discussed in the section titled “Management
Discussion and Analysis”
Air Deccan has created yet another first by
partnering with India Post for sale of tickets at post offices. This unique
tie-up is one amongst the various innovative distribution channels that the
airline operates for dispensing tickets. Air Deccan was the first airline to
introduce ticketing at petrol pumps, retail outlets, online kiosks, web outlets
making air tickets easily accessible round the clock. India Post, the country’s
150 year old postal system with more than Rs.0.150 Million post offices and
over 6 lakhs employees is the largest postal network in the world. It has
access to entire population of the country spread over varied terrain as the
arid deserts of Rajasthan to the icy reaches of Ladakh. India post has 5000
Internet enabled post offices in India and Initially Air Deccan tickets will be
available across 500 Internet enabled post offices across the state of
Karnataka.
Air Deccan will continue to aggressively grow
its operations in the coming months and years with aircraft induction plans to
keep pace with the growing market requirements and aims to become the largest
people carrier in India
The aviation business is highly capital
intensive and requires constant injection of capital in order to sustain the
growth. Additionally, market development, brand building and awareness require
significant investment and expenditure on an on going basis. In their quest for
fund raising, several investment proposals were evaluated to find a suitable
investor who would add value to the company’s business. An arrangement was
entered into with the UB Group wherein a preferential allotment 26% of the
equity shares of the company would be made at a value of Rs.155 per share
helping the company raise rs.5459.400 Millions. Consequently, the allotment of
shares were completed on 30 June, 2007 and an agreement was entered into
between the company’s promoters, the company, United Breweries (Holdings)
Limited and Kingfisher Radio Limited (the acquirer of 26% shares). This
agreement extends rights relating to appointment of directors by both the UB
Group and the Promoters, the constitution of the Board and Board meetings,
transfer and sale of shares by the investors and promoters etc.
This investment by the UB Group will ensure
that the company’s robust low cost business model is nurtured and this
association provides substantial value addition to your company. The company’s
focus is to actively pursue opportunities for synergies between the UB Group
owned Kingfisher Airlines and Air Deccan which will ensure implementation of
best practices, better cost management by leveraging the combined strength of
both groups, reduce capital costs and provide an overall added value
proposition to its passengers and partners by leveraging on the combined
strengths, in terms of network reach, connectivity, frequencies,
infrastructure, of both groups. The combined group of Kingfisher-Air Deccan
will be in a better position to offer air travel options across a wider network
and to all segments of the traveling population.
Air Deccan and Kingfisher Airlines will work
closely with each other to exploit opportunities for synergies that exist in
the areas of operations and maintenance, procurement, ground handling,
increased connectivity, feeder services, distribution, penetration etc. thereby
reducing costs, increased efficiencies and improved profitability of both the
airlines. Further sharing of knowledge and best practices between both the
airlines will ensure a more efficient operation and better value proposition to
passengers, employees and all other stakeholders.
As a major step towards exploiting the
synergies between the two groups. Air Deccan is undergoing a major re-branding
exercise and will, henceforth be known as “Deccan”. An all new livery and
colours and a complete makeover of the frontline staff and executives will
provide a whole new experience to both the existing traveler and a new
traveler. This effort, they believe, will serve to position the Airline and
your company on a better footing to withstand and beat competition in its
effort to move quickly towards profitability over the next several months.
Several initiatives and projects are in various stages of implementation
encompassing all areas of the company’s operations, sales, marketing and
distribution, front line and support services and the completion of these are
vital to achieve a profitable growth in the future.
Charter Services
The helicopter charter service of the company
logged another year of impressive growth. One more fixed wing aircraft was
added to the fleet during the period under review. The existing long term
contracts continue to ensure steady revenue. Your company continues to increase
its presence in off shore flying for oil sector and has again succeeded in
bagging a prestigious contract in this segment. The company’s operations of
ferrying pilgrims at Sri mata Vaishnodevi Temple in Jammu based on an
arrangement with the Temple trust, which commenced 4 years back, continues to
yield significant revenue for the company. The technical services offered by
the company have grown in revenue and customer base and now offers third party
maintenance and operational services to large Indian Corporate. During the
year, steps have been taken towards modernization of the battery charging
services, and establishment of a calibration facility for special tools. An
avionics maintenance facility is also being established to after maintenance of
helicopter radio equipment. During the year, there has been an increased focus
in trading of Bell helicopter spare parts.
Dividend
In view of operating losses incurred during
the year, the Directors do not recommend payment of dividends.
Outlook
The recent trend of consolidation within the domestic
aviation industry now means that there are three major market share leaders
viz., Air India-Indian, Jet Airways-Jetlite and Deccan-Kingfisher which control
more than 85% of the market. It is expected that this may result in a reduction
in cut-throat pricing leading to improved yields and consequently, a road to
profitability. The aviation industry in India lost, on a combined basis,
Rs.20000 Millions during the year 2006-07 and this recent consolidation would
serve to lower these levels of losses.
The future growth of air travel within, to and
from India will continue to depend on the growth of the Indian economy. The
continuance of positive economic factors and the strong performance of the
services and retail sectors should lead to sustained growth in passenger
traffic. Increasing disposable incomes will continue to stimulate the leisure
market within India. The company is refocusing on both business and leisure
traffic.
The company has drawn up a growth strategy for
the charter service operations and is pursuing opportunities to expand its
business in all segments, especially off shore operations for the Oil sector.
New segments continue to be tapped by the company and one such segment is
Medical evacuation in case of medical emergencies of understanding with Apollo
Hospitals Group for the provision of emergency medical evacuations.
Deccan Aviation (Lanka)
Due to the prevalent political conditions in
Sri Lanka, the operations of the company did not witness any significant improvement
or growth during the year. However, the situation is reported to be improving
and the Company has commenced cargo and passenger charter operations on fixed
wing aircrafts resulting in improvement in revenue and earnings. It is expected
that the political situation in Sri Lanka is likely to improve leading the way
to a significant growth in the tourism traffic which throws open greater
opportunities for the company’s charter operations.
Management Discussion and Analysis
Industry Structure and developments
The future growth of air travel within, to and
from India will continue to depend on the growth of the Indian economy. The
continuance of positive economic factors and the strong performance of the
services and retail sectors should lead to sustained growth in passenger
traffic. Increasing disposable incomes will continue to stimulate the leisure
market within India.
The unprecedented growth in passenger traffic
in India has attracted several airlines to set up operations resulting in a
highly competitive environment. A major development within the industry has
been the recent trend of consolidation. This has resulted in three major market
share leaders, viz., Air India-Indian, Jet Airways-Jetlite and
Deccan-Kingfisher which control more than 85% of the market. It is expected
that this may result in a reduction in cut-throat pricing leading to improved
yields and consequently, a road to profitability. The aviation industry in
India lost, on a combined basis, Rs.20000.000 Millions during the year 2006-07
and this recent consolidation would serve to lower these levels of losses.
The charter business is also now evolving and
the industry is now witnessing the emergences of charter companies for whom
this business is not for captive use but is the business itself. Competition in
the charter business is increasing with more private dedicated charter services
being set up.
The government’s policy on civil aviation
industry is continuously evolving and has been largely positive. The government
has announced a policy for construction and development of new airports in
several cities and towns to improve connectivity.
However, in the midst of all the positive
developments, a major negative move was the with drawl of the Income Tax
exemption u/s 10(15A) of the Income Tax Act, 1961 relating to withholding tax
on aircraft lease rentals which is likely to result in additional costs to the
operators.
Further, the levy of Import duties in respect
of import of certain aircrafts used for charter services will also increase the
acquisition cost for the charter service operators.
Opportunities and Threats
Under-penetrated markets and high economic growth
Despite recent growth in air passenger
traffic, India continues to have relatively high under-penetration of air
services. There is a high level of potential demand in Tier-II and Tier-III
cities is continuing to witness a strong economic performance and the company’s
ATR operations are specifically geared to tap this latent market over a period
of time.
Increasing consumerism and affordability
The aviation market has witnessed a shift from
train and road travel to air travel due to increase in disposable income and to
satisfy growing aspirations. The passenger market thus continues to expand
providing enough business to fill their increasing capacity deployment.
Infrastructure constrains
With the continued capacity expansion by all
airlines, there are now huge pressures and demands on the limited enabling infrastructure,
such as airport facilities, parking bays, air traffic control facilities and
takeoff and landing slots with all operators competing for the limited
facilities available. The growth in infrastructure has, unfortunately, not kept
pace with the growth of the industry which has led to air traffic congestion
leading to increased costs and flight delays.
Shortage of skilled manpower
There generally exists a shortage of skilled
and experienced pilots and engineers due to the general worldwide growth of the
aviation industry. They are attempting centres so as to achieve
self-sufficiency in this area.
Segment-wise or product-wise performance
The company operates in a single business segment,
i.e. of providing scheduled and unscheduled air transportation services.
Further, the company currently operates only in India and does not have
operations outside India. Accordingly, no separate and geographical disclosures
are required to be given.
Outlook
The future growth of air travel within, to and
from India will continue to depend on the growth of the Indian economy. The
continuance of positive economic factors and the strong performance of positive
of the services and retail sectors should lead to sustained growth in passenger
traffic. Increasing disposable incomes will continue to stimulate the leisure
market within India.
The airline industry in India has been going
through an intensely competitive phase. However, the recent trend of consolidation
in the industry should help move the industry towards a more positive future.
The aviation business, being highly capital
intensive, requires constant injection of capital in order to sustain the
growth. They recently entered into an arrangement with the UB Group wherein a
preferential allotment of 26% of the equity shares of the Company would be made
at a value of Rs.155 per share helping the Company raise Rs.5459.400 Millions.
This investment by the UB Group will ensure that the company’s robust low cost
business model prospers along with the synergy that it will have with
Kingfisher Airlines (UB Group Company). The two airlines, viz. Deccan and
Kingfisher will work closely with each other to exploit opportunities for
synergies that exist in the areas of operations and maintenance, procurement,
ground handling, increased connectivity, feeder services, distribution
penetration etc, thereby resulting in decreased costs, increased efficiencies
and improved profitability of both the airlines. Further, sharing of knowledge
and best practices between both the airlines will ensure a more efficient
operation and better value proposition to passengers, employees and all other
stakeholders.
Several initiatives and projects are in
various stages of implementation encompassing all areas of the Company’s
operations, sales, marketing and distribution, front line and support services
and the completion of these are vital to achieve a profitable growth in the
future.
Cost management and control is an ongoing initiative,
being an important part of the culture of a low cost airline.
Their charter service operation continues to
focus on customers, relatively large fleet, innovative spirit and superior
maintenance skills.
The company is in the process of executing the
growth strategy for the Charter service operations and is pursuing
opportunities to expand its business in all segments, especially off shore
operations for the oil sector.
Discussion on financial performance with respect to operational
performance
The current financial period is for 12 months
from July 2006 to June 2007 and is, therefore, not strictly comparable with the
results of the previous financial period of 15 months from April 2005 to June
2006 (Fiscal 2006)
Key trends and developments during the twelve
months ended June 30, 2007 included.
v A 20.59% increase in the number of aircrafts in the Air Deccan fleet,
from 34 aircrafts as on June 30, 2006 to 41 aircrafts as on June 30 ,2007 with
the net addition of 4 ATRs and 5 Airbus A320s;
v A 14.55% increase in the number of airports served, from 55 airports as
on June 30,2006 to 63 airports as on June 30,2007 and
v A 12.97% increase in the number of flights operated from 239 routes as on
June 30, 2006 to 270 routes as on June 30, 2007.
Income
Their total income stood at Rs.21423 Million
in the twelve months ended June 30, 2007. Sale of airline tickets and related
income accounted for 79.81% of the total income as compared to 86.74% in Fiscal
2006. This increase was principally due to the expansion of their airline
operations.
Sale of Airline Tickets and Related income
Sale of airline tickets and related income
stood at Rs.17098 Millions in the twelve months ended June 30, 2007 principally
due to:
Increase in the number of passengers flown
which represented an increase of 2333452 or 52.45% more passengers than it flew
in Fiscal 2006
Induction into service of 9 aircrafts (5
Airbus A320s and 4 ATRs), and
Increase in their network in terms of number
of sectors, flights and airports connected.
Other Income
Other Income stood at Rs.3678 Millions in the
twelve months ended June 30, 2007. Of this amount, profit on transfer of
aircraft/engine purchase rights contributed Rs.2885 million or 78.44% of the
total other income. They also earned certain credits from aircraft
manufacturers amounting to Rs.275.61 Million, which accrued during the year
under review.
Expenditure
Total expenditure stood at Rs.25585 Million
for the year ended June 30, 2007. In these twelve months, their costs were
largely affected by increase in fuel prices, an increase in the number of their
pilots, cabin crew and engineers salaries and other costs directly attributable
to the growth of the Air Deccan scheduled airline operations such as lease
rentals, airport related charges, repairs and maintenance, selling,
administration and general expenses, employee-related costs and other direct
operating expenses. The number of available seats flown during the twelve
months ended June 2007 was 8682447 as compared to 6031409 available seats flown
for the fifteen months ended June 30, 2006.
Aircraft Fuel Expenses
Expenditure on fuel stood at Rs.9795 million
for the year ended June 30, 2007. Aircraft fuel costs increased from 50.59% of their
income in Fiscal 2006 to 55.20% of their income for the year ended June 30,
2007. This increase was principally due to the increase in fleet size and the
consequent increase in routes flown, and the 9% average increase in unit fuel
cist for the year ended June 30, 2007 as compared to Fiscal 2006.
Aircraft/Engine Lease Rentals
Aircraft/Engine lease rentals stood at Rs.4031
Million for the twelve months ended June 30, 2007. during the year under review
they added 4 ATRs and 5 Airbus A320s on lease, which added to the lease rentals
on their existing fleet.
Other direct operating Expenses
Other direct operating expenses stood at
Rs.6907 million for the year ended June30, 2007 against Rs.5058 million for
Fiscal 2006. This was 38.92% of their income for the twelve months ended June
30, 2007, against 40.91% for Fiscal 2006. Other direct operating expenses
increased principally due to the acquisition of additional aircraft and the
addition of capacities, routes and sectors by Air Deccan and increase in related
costs including repairs and maintenance, airport charges/ground handling,
spares and components consumed (including amortization of rotables), insurance
and selling and distribution costs. These costs also included costs related to
the setting up and maintenance of infrastructure at new airports and for the
additional flights they commenced serving during this period. However strong
and sustained cost management ensured that this component reduced as a
percentage of income.
Amortization
Amortization charges stood at Rs. 262 million
for the year ended June 30, 2007.
Depreciation
Depreciation charges were Rs.177 million for
the twelve months ended June30, 2007. These expenses reflect principally the
depreciation on two ATRs acquired on a hire purchase basis and on ATR obtained
on ownership basis and financed by a local financial company.
Provision for tax
Their total tax expense, comprising fringe
benefit tax. Was Rs. 33.99 million for the year ended June 30, 2007. Current
tax and deferred tax expense were nil in the year ended June 30, 2007.
Information as required under clause 49 of the listing agreement in
respect of directors retiring by rotation and being proposed to be appointed /
reappointed.
Lt. Gen N S Narahari, a recipient of the Param
Vishisht Seva Medal for his services to the Indian Army, and was awarded a
mention in dispatches for his role in the 1971 war. He is an engineering
graduate from the Mysore University and a post graduate in defence studies from
the Madras university. He served in the Indian army for 37 years in various
command., staff and instructional appointments. He saw active service in the
1965 and 1971 Indo-Pak wars and was also engaged in counter insurgency
operations in Punjab and Assam. Lt. Gen N S Narhari retires from the Army on 31
October 1990 as the Commandant of the prestigious army was college. Lt. Gen N S
Narhari has been associated with your company since its inception. He is not a
director of any company other than Deccan Aviation Limited.
S N Ladhani and industrialist by profession
possesses 46 years of business experience with diversified interests in sectors
such as beverages chemicals, renewable power generation, PE-pipes, threads and
real estate. He started doing business at the edge of 18 in the Construction
sector and thereafter established one of the largest bottling plants in India
for ‘Parle’ soft drinks. Subsequently he became one of the first bottler for
Coca Cola. Upon its re-entry into India, in 1993. He has been associated with
your company since 1996 and has been one of its core investors. He is not a
director of any public limited company other than Deccan Aviation Limited in
which he holds 13155 equity shares as on 30th June 2007.
Commitments and contingent liabilities not provided for:
(Rs. are in Millions)
|
Particulars |
As at June30, 2007 |
As at June 30, 2006 |
|
Commitments/contingent liabilities |
|
|
|
Guarantees given by banks |
2426.391 |
2131.420 |
|
Letters of credit outstanding |
89.570 |
450.755 |
|
Estimated amount of contracts remaining to
be executed on capital account and not provided for (net of advances) |
74740.367 |
89336.444 |
|
Claims against the company not acknowledged
as debts (including civil and customer suits) in the normal course of business. |
112.977 |
23.290 |
|
Total |
77369.305 |
91941.909 |
The company has entered into agreement for
purchase of aircraft/engines under which the company has commitments to purchase
aircrafts/engines over a period stipulated in the agreements. Such agreements
involve complex pricing arrangements wherein the company receives
discounts/credits on such purchases, which are based on the commitments to
purchase, which the company is confident to fulfill currently. Accordingly, the
amount of contingent liability, if any, as at the balance sheet date is
currently not ascertainable.
In addition to the above, there are certain arbitration
proceedings with customers/suppliers, in respect of which claims are currently
not ascertainable.
As per Website
Details:
Presenting the
pioneers of heli-chartering in Indian skies. Deccan Aviation. An
organisation conceived by a group of professionals from Army Aviation, who not
only shared the passion for flying but also whole-heartedly understood the
psyche of the community, whose needs they were addressing. The largest
helicopter company in the private sector that not only conceptualised the whole
category of helicopter flying but also propelled it into vividly expressive
areas of application. And one that is committed towards providing
unparalleled services in the field of charter aviation. Backed by
technical tie-ups with Bristow Helicopters, global leaders in oil exploration
and off-shore logistics
CORPORATE CHARTERS
v Travel to Factory Sites/
Mines/Quarries
v Aerial Surveys of Projects/
Sites
v Delegate Entertainment
v Travel to Conference
Destinations
v Videography for Road Shows
v VVIP Travel
v Power Line Reconnaissance
v Offshore oilfield logistic
support
v Underslung Load Carriage
GOVERNMENT & ADMINISTRATION
v Geophysical Resource Survey
v Law & Order Reconnaissance
v Disaster Management Operations
v Election Campaigning
Miscellaneous
v Film Production
v Emergency Medical Evacuation
v Electronic News Gathering
v Aerial Videography for Motor Sports
TOURIST CHARTERS
v Helitours to Tourist
Destinations
v Hill Station Visits
v Package Tours & Overnight
Getaways
PILGRIMAGE CHARTERS
v Trips to Puttaparathi,
Tirupathi, Shirdi, Vaishno Devi & Shravanabelagola
LEISURE PACKAGES
v Fishing, Golfing, Wildlife
Sanctuary Packages
v Honeymoon Cruises
v City Aerial Sight Seeing
Subject’s fleet comprises of the latest models of helicopters in use in the world. Fort Worth, Texas-based Bell Helicopters is the largest helicopter company in the world with a market share of about 55 per cent. The Bell Long Rangers and Jet Rangers from Bell Helicopters, Texas are renowned internationally for their versatility, reliability and all-terrain capabilities. They are assisted by the multi-purpose usages of the Ecureuil twin engined AS 355 helicopter. The Bell 407 is the most modern machine in their helicopter fleet.
Subject’s services
are one-of-a-kind. With six operational bases across the country (Mumbai,
New Delhi, Katra, Bangalore, Ranchi and Surat off-shore base), accessibility
and application aren't a problem. The company has choppers to suit any purpose,
whether it be all-expense-paid heli-tourism packages. Medical Evacuation
or Devotional Heli-rides. Chartered Pilgrimages or Leisure
Packages. Extendable into any field. Which explains why one of the
Bell 212 helicopters and the Ecureuil twin engined AS 355 helicopter were
employed for providing off-shore oilfield logistic support for the last 4 years
at Yanam, South of Rajahmundry in the Godavari delta. Not to mention that the
choppers had maintained an availability rate of 99.25% over the last 4
years. Their offshore operations ex-Surat commenced on 15th Feb 2003.
Stringent
International aviation audits are regularly carried out to benchmark ourselves
to global standards
The sky maybe the limit, but with a subject’s chopper, it's their
imagination. If its unusual, dramatic or just plain imaginative, a
chopper is the only solution. And they have found themselves in
extraordinary situations. From being the vehicle that gave a couple a
dream start to their honeymoon to showering flower petals on another. Or
being used time and again by the business world for corporate and consumer
promotions and employee motivation. Customised packages also allow you to
pick the time and destination of their choice.
A helicopter's capability of reaching inaccessible areas makes it vital during
emergencies. Deccan Aviation choppers have been used for medical
evacuation and find themselves in need during emergency rescue and disaster
management. The pilots are fully trained to handle search and rescue
operations. Jindal, Tractabel, Badger Energy, Apollo Hospitals and Manipal
Hospital have chartered the helicopters for Medical Evacuation
If you are in a
medical emergency like an accident or a heart attack, while on a sight-seeing
or business trip any place within 350 kms of a subject’s Base - at Delhi,
Bangalore, Hyherabad, Mumbai and Chennai, you can be immediately evacuated to
the closest reputed hospital
Company Details:
Subject,
India’s first low cost carrier is a business unit of Deccan Aviation Private
Limited, India's largest private heli-charter company. Formed in 1995, Deccan
Aviation Private Limited has carved a niche for itself in the Indian aviation
scene with its reputation for providing speedy and reliable heli-services for
company charters, tourism, medical evacuation, off-shore logistics and a host
of other services.
Captain
G R Gopinath, the Managing Director is a graduate of the prestigious National
Defence Academy and has served the Indian Army. A recipient of the prestigious
ROLEX Award for Ecological site farming and the WIPRO PRSI Award, he is the
driving force behind the organization.
Captain KJ Samuel is the Executive Director and, along
with Capt Gopinath, is a founder Director. An experienced Army Aviation pilot,
he is a Presidential Gallantry Award winner and still actively flies for the
parent company.
Mr S N Ladhani, Chairman of the Ladhani Group of Companies
(India's largest Coke Bottler) is on the Board of Directors. Another
illustrious member of the Board of Directors is Mr Vijay Amritraj, India's best
known Tennis star.
Air Deccan has 48 seater ATR-42’s in operation in its
fleet. In India, this aircraft has already proven to be a highly successful
one, both for its efficiency and cost effectiveness. It is presently being used
by both, Indian Airlines and Jet Airways.
Air Deccan also has Airbus A-320 - 180 seater aircraft.
These new generation fly-by-wire aircraft, with plush leather seats and drop
down televisions have brought about low-fare inter-metro connectivity, bringing
various destinations on the airline’s air map. These aircraft provide in-flight
entertainment for the passengers – a first for any domestic airline in India.
The airline has recently acquired ATR 72 – 500 aircraft.
These are 72 seater aircraft with superior engine power and improved interiors
for a very comfortable flying experience. The aircraft is very reliable with
highly improved productability.
Air Deccan has adopted a 'lean-and-mean' approach to
staffing and aims at maintaining a low aircraft-to-employee ratio. They have
some of the most experienced administrators, aircrew and engineers on their
rolls. A good work culture coupled with a skilled workforce is the backbone of
the company.
Clients
A random sampling of Deccan Aviation's (institutional) customers:
- Global CEO of
Nestle
- World CEO of
Volvo
- Vice-President
and Managing Director of Jack Welch Technology Centre
- Global Chief
Operating Officer of Bank of America
- Senior
Vice-President General Electric (USA)
- Chairman and
MDs of Reliance Industries
- COO of Sun
Microsystems
- President of
Astra IDL
- Chairman of
Hero Honda
- His Holiness
the Dalai Lama
- HRH Crown
Princess Mathilde of Belgium
- Mr David
Rockefeller
- Mr. John Gray
(best-selling author)
- Political
leaders like Mrs. Sonia Gandhi, Mr. Atal Behari Vajpayee, Mr.L.K.Advani,
Mr. Chandrababu Naidu, Mr. S.M.Krishna, Mr. Naveen Patanaik and Mr. Arjun
Munda to name just a few
Companies
- Fiat
International
- Yoga Narasimha
Temple Trust
- Dell Computers
- World Bank
- Sterlite
- Adidas India
- Nortell
Networks
- Jaiprakash
Industries
- Bank of
America
- Discovery
Channel
- National
Geographic
- World Wildlife
Fund
- Intel Corporation
Services
Deccan Technical Services (DTS) - a Unit of Deccan Aviation is a Customer
Service Facility (CSF) of Bell Helicopter Textron. The CSF is benchmarked to
global standards and capable of repair and overhaul of major components and
assemblies of all models of Bell helicopters operating in the country today.
- Deccan
Technical Services offers third party maintenance to other
helicopter/airplane operators
- Deccan
Technical Services looks after the BELL Customer Service Facility and
related technical and logistic services
- Deccan
Technical Services is benchmarked to International standards and staffed
by qualified, experienced and licensed engineers trained at Bell Training
Academy, Fort Worth, Texas for carrying out field maintenance and
component overhaul of Bell 206 Series and Bell 407 helicopters
In December 2004, Deccan Technical
Services was awarded the Customer Service Facility (CSF) status for helicopters
manufactured by Bell Helicopter Textron. With this award, Deccan Technical
Services becomes the only helicopter operator to be given this privilege.
Deccan Technical Services is a subsidiary of Deccan Aviation.
DTS Facility
Their state-the-art facility at Jakkur Aerodrome, Bangalore, spread over 5,500
sq ft, comprises an approved Technical Store, Component Overhaul Shop, Radio Shop,
Battery Shop and Hangar Floor space. It houses Administration, Engineering and
QC departments, all seamlessly integrated with cutting-edge IT to enable
superior, cost-effective productivity. It is also home to a separate facility,
which currently houses a wheel and brake facility for ATR-42 / 72 and Airbus
320. This will soon be expanded to house a full Avionics Shop and Starter
Generator Overhaul facility.
The
facility has a Day VFR airfield (3000 ft x 75 ft) and helipads to accommodate
up to five helicopters at a time. Helicopters and small aircraft can be
directly flown to the facility. It can also be accessed by road, being on NH-7,
about 14 km from the centre of Bangalore city.
Management
Promoted and operated by senior officers from the Indian Army Aviation, Deccan
Aviation has 34 pilots on its rolls. This, combined with its country-wide
presence provides it great operational depth. To maintain the pilots at a high
level of competency, Deccan employs a training captain. The company is
completely self-sufficient in its maintenance requirements with 18 trained
engineers.
Deccan Aviation's Managing Director is Captain G R Gopinath. He is a graduate
of the National Defence Academy and has served in the Indian Army. A recipient
of the prestigious ROLEX Award for Ecological silk farming and the WIPRO PRSI
Award, he is the driving force behind the organization.
Captain KJ Samuel is the Executive Director and, along with Capt Gopinath, is a
founder Director. An experienced Army Aviation pilot, he is a Presidential
Gallantry Award winner and still actively flies for the parent company.
Mr S N Ladhani, Chairman of the Ladhani Group of Companies (India's largest
bottler of Coke) is on the Board of Deccan Aviation.
Another
illustrious member of the Board of Directors is Mr Vijay Amritraj, India's best
known tennis star.
Accolades
- Deccan
Aviation was awarded the Operator Safety Award for the year 2000 by the
Helicopter Association International in recognition of the company's
outstanding record in flight and maintenance safety standards
- Deccan
Aviation is perhaps the only aviation company in India that regularly
organizes international audits to benchmark the company's operational and
maintenance quality standards with the best in the world. The company has
been audited in the recent past by Eurasia Air Services (Singapore), A.M.S
(Singapore), Avex Pvt. Ltd. (Australia) and Hart Aviation.
- Deccan
Aviation has been associated with M/s Cairn Energy (India) Pvt. Ltd. for
offshore support since 1998. Deccan Aviation is well equipped for search
& rescue operations . This has been possible only due to extremely
high levels of maintenance reliability and efficient flight operation.
- In May 2004,
Deccan Aviation (Lanka) Pvt. Ltd. became the first non-military helicopter
operator on the island nation.
- Deccan
Aviation is the only helicopter operator to be awarded the Customer
Service Facility (CSF) status in South Asia by Bell Helicopter Textron for
repair, servicing and overhaul of various models of Bell helicopters.
CMT REPORT (Corruption, Money Laundering
& Terrorism
The Public Notice information has been collected from various sources
including but not limited to: The Courts, India Prisons Service,
Interpol, etc.
1] INFORMATION ON
DESIGNATED PARTY
No exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered
forfeited for violation of money laundering or international anti-terrorism
laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE
GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE
RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.39.43 |
|
UK Pound |
1 |
Rs.77.06 |
|
Euro |
1 |
Rs.57.65 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
5 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
2 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
- |
|
--LIQUIDITY |
1~10 |
6 |
|
--LEVERAGE |
1~10 |
6 |
|
--RESERVES |
1~10 |
5 |
|
--CREDIT LINES |
1~10 |
4 |
|
--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 |
|
42 |
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, they have no basis upon which to
recommend credit dealings |
No Rating |
|