MIRA
INFORM REPORT
|
Report Date : |
11.07.2008 |
IDENTIFICATION
DETAILS
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Name : |
RAJVIR INDUSTRIES LIMITED |
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Registered Office : |
Surya Towers, 1st Floor, 105 Sardar Patel Road, Secunderabad
– 500003, Andhra Pradesh |
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Country : |
India |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
01.09.2004 |
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Com. Reg. No.: |
044053 |
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CIN No.: [Company
Identification No.] |
L17116AP2004PLC044053 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
HYDR02945F |
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PAN No.: [Permanent
Account No.] |
AACCR9461P |
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Legal Form : |
A Public Limited Liability Company. The Company’s Shares are Listed on
the Stock Exchanges. |
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Line of Business : |
Manufacturer of Textile, Jute and Yarn Products. |
RATING &
COMMENTS
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MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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 |
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Maximum Credit Limit : |
USD 1800000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a well established and company meeting its normal
commitments timeously. Trade relations are fair. Business is active. General
financial position is good. The company can be considered good for normal business dealings. |
LOCATIONS
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Registered Office/ Factory : |
Surya Towers, 1st Floor, 105 Sardar Patel Road,
Secunderabad – 500003, Andhra Pradesh, India |
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Tel. No.: |
91-40-27845628/ 27819856/ 57/ 58 |
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Fax No.: |
91-40-27840656/ 27846854 |
/DIRECTORS
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Name : |
Mr. U. K. Agarwal |
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Designation : |
Managing Director |
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Name : |
Mr. S. N. Daga |
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Designation : |
Director |
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Name : |
Mr. Ritesh Kumar Agarwal |
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Designation : |
Executive Director |
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Name : |
Mr. Vijay Kumar Gupta |
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Designation : |
Director |
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Name : |
Mr. K. J. Reddy |
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Designation : |
Director |
KEY EXECUTIVES
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Name : |
Mr. R. D. Sharma |
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Designation : |
Company Secretary |
BUSINESS DETAILS
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Line of Business : |
Manufacturer of Textile, Jute and Yarn Products. |
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Products : |
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Exports : |
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Countries : |
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GENERAL
INFORMATION
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Bankers : |
Not Available |
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Banking
Relations : |
- |
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Auditors : |
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Name : |
S. Daga and Company Chartered Accountant |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
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3500000 |
Equity Shares |
Rs.10/- each |
Rs.35.000 Millions |
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Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
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3030000 |
Equity Shares |
Rs.10/- each |
Rs.30.300 Millions |
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FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
30.300 |
30.300 |
30.300 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
319.900 |
256.400 |
191.800 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
350.200 |
286.700 |
222.100 |
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LOAN FUNDS |
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1] Secured Loans |
941.500 |
705.200 |
380.800 |
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2] Unsecured Loans |
136.500 |
109.900 |
80.300 |
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TOTAL BORROWING |
1078.000 |
815.100 |
461.100 |
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DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
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TOTAL |
1428.200 |
1101.800 |
683.200 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
1104.900 |
590.500 |
454.200 |
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Capital work-in-progress |
16.400 |
262.600 |
11.300 |
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INVESTMENT |
0.000 |
0.000 |
0.000 |
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DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
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CURRENT ASSETS, LOANS & ADVANCES |
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Inventories |
364.600
|
190.700 |
146.900 |
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Sundry Debtors |
122.800
|
148.800 |
173.900 |
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Cash & Bank Balances |
28.400
|
80.200 |
5.300 |
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Other Current Assets |
0.000
|
0.000 |
0.000 |
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Loans & Advances |
180.600
|
78.800 |
60.600 |
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Total
Current Assets |
696.400
|
498.500 |
386.700 |
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Less : CURRENT
LIABILITIES & PROVISIONS |
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Current Liabilities |
347.300
|
224.900 |
162.100 |
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Provisions |
43.000
|
27.500 |
11.200 |
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Total
Current Liabilities |
390.300
|
252.400 |
173.300 |
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Net Current Assets |
306.100
|
246.100 |
213.400 |
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MISCELLANEOUS EXPENSES |
0.800 |
2.600 |
4.300 |
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TOTAL |
1428.200 |
1101.800 |
683.200 |
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PROFIT & LOSS
ACCOUNT
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PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
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Sales Turnover |
1665.600 |
1313.200 |
781.700 |
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Other Income |
35.900 |
11.800 |
8.300 |
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Stock Adjustments |
131.200 |
(7.800) |
(42.600) |
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Total Income |
1832.700 |
1317.200 |
747.400 |
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Profit/(Loss) Before Tax |
125.900 |
103.400 |
33.100 |
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Provision for Taxation |
45.400 |
22.200 |
13.800 |
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Profit/(Loss) After Tax |
80.500 |
81.200 |
19.300 |
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Export Value |
575.718 |
213.582 |
NA |
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Expenditures : |
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Raw Material Consumed |
1152.200 |
776.600 |
471.900 |
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Excise Duty |
29.600 |
30.400 |
20.600 |
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Power & Fuel Cost |
132.300 |
116.000 |
64.200 |
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Manufacturing Expenses |
67.500 |
72.200 |
55.000 |
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Employee Cost |
81.500 |
60.900 |
32.100 |
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Selling and Administrative Expenses |
119.500 |
77.300 |
30.500 |
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Miscellaneous Expenses |
12.900 |
8.000 |
4.800 |
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Interests and financial Charges |
58.500 |
38.300 |
17.700 |
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Depreciation & Amortization |
52.800 |
34.100 |
17.500 |
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Other Expenditure |
0.000 |
0.000 |
0.000 |
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Total Expenditure |
1706.800 |
1213.800 |
714.300 |
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QUARTERLY RESULTS
|
PARTICULARS |
30.06.2007 1st Quarter |
30.09.2007 2nd Quarter |
31.12.2007 3rd Quarter |
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Sales Turnover |
337.100 |
681.900 |
418.400 |
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Other Income |
7.500 |
12.900 |
10.600 |
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Total Income |
344.600 |
694.800 |
429.000 |
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Total Expenditure |
278.000 |
629.600 |
371.800 |
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Operating Profile |
66.600 |
65.200 |
57.200 |
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Interests |
20.000 |
21.100 |
25.000 |
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Gross Profit |
46.600 |
44.100 |
32.200 |
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Depreciation |
16.500 |
16.500 |
16.900 |
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Tax |
3.500 |
3.200 |
1.900 |
|
Reported PAT |
26.600 |
24.400 |
13.400 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2007 |
31.03.2006 |
31.03.2005 |
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Debt-Equity Ratio |
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3.12
|
2.70 |
2.28
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Long Term Debt-Equity Shares |
|
2.09
|
1.78 |
1.27
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Current Ratio |
|
0.94
|
1.03 |
1.03
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TURNOVER RATIOS |
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Fixed Assets |
|
1.43
|
1.66 |
1.91
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Inventory |
|
6.00
|
7.78 |
9.12
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Debtors |
|
12.27
|
8.14 |
7.71
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Interests Cover Ratio |
|
3.15
|
3.70 |
2.87
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Operating Profit Margin (%) |
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14.24
|
13.39 |
8.74
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Profit Before Interests and Tax Margin (%) |
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11.07
|
10.79 |
6.50
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Cash Profit Margin (%) |
|
8.00
|
8.78 |
4.71
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Adjusted Net Profit Margin (%) |
|
4.83
|
6.18 |
2.47
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Return On Capital Employed (%) |
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14.78
|
16.27 |
13.21
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Return On Net Worth (%) |
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26.55
|
34.36 |
16.33
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LOCAL AGENCY
FURTHER INFORMATION
OPERATIONS
The Company achieved a turnover of Rs.1671.884 Millions and the net profit of
Rs.80.560 Millions as against turn over Rs.1294.608 Millions and Net profit of
Rs.811.72 respectively in the previous year. The production during the year was
9920054 kgs as against 9762118 Kgs in the previous year. The directors are very
happy to inform the members that the commercial production of the 1st unit of
Tandur is commenced in September 2006 and now the Unit is in full operation.
Further the directors have identified another running Unit in Italy, which was
contracted with and will be brought into India. The Directors are hopeful that
the Plant will be erected and commissioned during the year 2007-08.
CAPITAL EXPENDITURE
·
Mahabubnagar Unit:
The company has incurred a capital expenditure of Rs.51.100 Millions for up
gradation of Machinery and balancing equipments at Mahabubnagar Unit.
·
Tandur Unit:
As represented last year the company has contracted and brought in India a
running plant from Italy and the same was erected and commissioned successfully
during the year. The commercial production started in the month of September
2006. The directors are happy to inform that the company has identified and
negotiated one more Unit in Italy for another Unit in Tandur. The total project
cost is Rs.670.000 Millions out of which Axis Bank Limited has sanctioned Term
loan for Rs.500.000 Millions and balance will be funded through internal
accruals
EXPORTS
The Company has achieved Exports turnover of Rs.581.400 Millions as against
Rs.222.100 Millions last year.
MANAGEMENT DISCUSSION AND
ANALYSIS REPORT
INDUSTRY STRUCTURE, DEVELOPMENTS AND
PRODUCT PERFORMANCE
Textile Industry continues to play significant role in Indian economy as it
contributes about 14% to the Industrial Production, 4% to the GDP and 17% to
the country's Foreign Exchange Earnings & is the largest employment
provider next to the agriculture sector having direct employment of about 38
million people. It is extremely complex & diversified ranging from
small-scale sector to highly sophisticated Mills. The Yarn Industry being part
of Textile industry companies 2950 Mills (including SSI) with installed
spindealage of about 37.47 million. Three forth of production in the spinning Industry
is from the private sector and the balance is from cooperative and public
sector units.
The quota free era has benefited the Indian Textile Industry and has put India
ahead of its regional peers in terms of export of value added products. While the
export for value added products is growing, resulting in an increase in India's
Market share, the favourable product mix has contributed to higher realisation
& better margins. Fueled by the bouyant Indian economy growing at a rate of
8% the Indian Textile Industry is registering an abnormal growth of around 9 to
10% as against 3 to 4% during the quota regime. In continuation of its policy
to support the Indian Textile Sector the Government of India has initiated the
measures like rationalization of fiscal levies, extension of the Technology
Upgrading Fund scheme (TUFs) etc. The other growth driver has been a
substantial increase in cotton production, higher disposable income level,
consumer preference for high-end value added products etc. Further the entry of
big retailers is also expected to have a significant impact on future direction
of the Textile Industry. The Industry is quite confident of achieving 12%
growth in the coming years.
The Company has continued to focus on production of high value products like
Melange, Modal, and Fiber dyed, and synthetic yarn, combed and compact yarn
with long-term strategy for establishing itself as a preferred supplier of
value added yarn in the national as well as international market. The company
is fully committed with quality assurance of the product and for that purpose a
state of art quality lab is established in its new Tandur facility.
The Company is continuing the process of modernizing the plant to improve the
quality of its products to meet the changing requirements of the garment
manufacturers and also the international market in the constantly changing
Market scenario. The Company continues to export a variety of high value added
yarn to various countries like Korea, Taiwan, Egypt, Spain, Mauritius, Turkey,
South Africa and other Countries. In the domestic market also the company has
improved its supplies to the high-end quality market with better realizations.
The Company is reasonably confident of maintaining its progress in this
direction.
Performance Highlights
The Company is dedicated to achieving its long-term goals by implanting its
business strategies. The result is an increase in net revenue and profits
despite of fierce competition in the domestic and international Markets. The
turn over of the company is increased from Rs.1294.600 Millions to Rs.1671.800
Millions an increase of 29.14% & PBT of Rs.103.300 Millions to Rs.125.900
Millions, an increase of 21.93%. The growth in revenue was driven by both
increases in volume as well as realization.
Opportunities, Threats, Risks and
Concerns:
The quota free
era has benefited the Indian textile Industry and has put India ahead of its
regional peers in terms of exports of value added products to both EEC &
U.S markets. On the other hand due to removal of quota the countries like US
& EEC are not bound to import from India but they can import from any
country who can supply quality product with low cost. Even though India is
having several advantages of raw material availability, man power availability
the manufacturing cost is still high compared to the major manufacturing
countries like China and Pakistan in some aspects. Power costs, interest costs
for borrowings, labour costs form the major aspects of India's cost being on
the higher side. The competition from China especially after the year 2008 when
quantitative restrictions on China are expected to be removed by major U S
& E U markets is a threat which the Indian Industry has to handle. In fact
China would be the major beneficiary of the free quota trade. Apart from this
in India, there had already been a building up of excess capacity in spinning
segment identifying the already severe competition. Indian producers should
therefore, make the best of the situation to consolidate their position to take
on the increased competition from other countries. The Industry should also be
ready to take on the pressure on the margin from exports due to appreciation of
Indian rupee against the U.S.dollar.
Internal Control Systems and their
adequacy
The Company has an adequate internal control system commensurate with the size
and complexity of the organisation. The Company has undertaken a comprehensive
review of all internal control systems to take care of the needs of the
expanding size of the Company and also upgraded the IT support systems. The
Audit Committee periodically reviews the adequacy of the Internal Audit
functions.
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.43.16 |
|
UK Pound |
1 |
Rs.85.51 |
|
Euro |
1 |
Rs.67.95 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
8 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
63 |
This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a
composite of weighted scores obtained from each of the major sections of this
report. The assessed factors and their relative weights (as indicated through
%) are as follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING
EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit transaction.
It has above average (strong) capability for payment of interest and
principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit consideration.
Capability to overcome financial difficulties seems comparatively below
average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
|