MIRA INFORM REPORT

 

 

 

Report Date :

19.07.2008

 

IDENTIFICATION DETAILS

 

Name :

JAI BHAWANI STEEL ENTERPRISES LIMITED

 

 

Registered Office :

No. 91, Armenian Street, Chennai – 600 001, Tamilnadu

 

 

Country :

India

 

 

Financials (as on) :

31.03.2006

 

 

Date of Incorporation :

23.04.1985

 

 

Com. Reg. No.:

18 - 11795

 

 

CIN No.:

[Company Identification No.]

U27101TN1985PLC011795

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

CHEJ00234D

 

 

Legal Form :

A Closely held Public Limited Liability Company.

 

 

Line of Business :

Manufacturer of Iron and Steel Products.

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Status :

Good

 

 

Payment Behaviour :

Regular

 

 

Litigation :

Clear

 

 

Comments :

Raja, Accounts Manager of the company denied latest financial Subject is a well established company having satisfactory track. The company is progressing well. It’s financial position is satisfactory. Payments are usually correct and as per commitments.

 

The company can be considered normal for business dealings at usual trade terms and conditions. Nothing adverse reported.

 

 

INFORMATION PARTED BY

 

Name :

Raja

Designation :

Accounts Manager

Date :

18.07.2008

 

 

LOCATIONS

 

Registered Office :

No. 91, Armenian Street, Chennai – 600 001, Tamilnadu, India

Tel. No.:

91-44-25211010/24349576/ 24349865/ 24349889

Fax No.:

91-44-24345255

E-Mail :

piyush@md4.vsnl.net.in

pramod_kumarsaraf@yahoo.co.in

srk_tn@airtelbroadband.in

Area :

1900 Sq. ft

Location :

Rented

 

 

Factory  :

2/2, 21 G N T Road, Panjetti Punneri Taluka

 

 

DIRECTORS

 

Name :

Mr. Ashok Kumar Saraf

Designation :

Managing Director

Address :

No. 148, Poonamallee High Road, Chennai – 600 010, Tanmilnadu, India

Date of Birth/Age :

14.10.1960

Date of Appointment :

07.10.1985

Date of Ceasing :

25.04.2004

 

 

Name :

Mr. Pramod Kumar Saraf

Designation :

Director

Address :

No. 6, Montieth 1st Lane, Egmore, Chennai – 600 008, Tamilnadu, India

Date of Birth/Age :

06.08.1962

Date of Appointment :

09.08.1996

 

 

Name :

Mrs. Sangeeta Saraf

Designation :

Director

Address :

No. 6, Montieth 1st Lane, Egmore, Chennai – 600 008, Tamilnadu, India

Date of Birth/Age :

02.09.1964

Date of Appointment :

26.03.1990

 

 

Name :

Mr. Kailash Jha

Designation :

Director

Address :

No. 28/18, Jeevarathnambalnagar, Thiruvottiyur, Chennai – 600 019, Tamilnadu, India

Date of Birth/Age :

01.07.1957

Date of Appointment :

25.04.2004

 

 

Name :

Mr. Piyush Saraf

Designation :

Director

Address :

No.8, Old No.63, Montieth Lane, Egmore, Chennai – 600 008, Tamilnadu, India

Date of Birth/Age :

17.01.1987

Date of Appointment :

14.07.2006

Other Directorship :

DDS Steel Rolling Mills Private Limited

U51420TN2006PTC060562

 

S D S Steels Private Limited

U51420TN2006PTC060563

 

 

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

 

As on 27.09.2005

 

Names of Shareholders

No. of Shares

Mr. Pramod Kumar Saraf

359800

Mrs. Sangeeta Saraf

90000

Mr. R Rajagopal

100

Mrs. Kalyani Rajagopal

100

RGF Capital Markets Limited

52000

RGF Fincon Private Limited

10000

RGF Real Estates Private Limited

25000

Sharp Investments Limited

38000

Profitline Securities Private Limited

30000

Total

605000

 

Equity share breakup (Percentage of total equity)

 

As on 31.03.2006

 

Sr. No.

Category

Percentage

1.

Bodies corporate (not mentioned above)

25.61

2.

Directors or relatives of directors

74.35

3.

Others

0.04

 

Total

100.00

 

 

 

 

BUSINESS DETAILS

 

Line of Business :

Manufacturer of Iron and Steel Products.

 

 

Imports :

 

Products :

Scrap

Countries :

All Over the World

 

 

Terms :

 

Selling :

Cash and Credit

 

 

Purchasing :

L/C , Credit

 

 

GENERAL INFORMATION

 

Customers :

Manufacturer

 

 

No. of Employees :

Total:120 (Office : 20, Factory : 100)

 

 

Bankers :

v      Union Bank of India

Main Branch

 

v      Indian Overseas Bank

236, Thambuchetty Street, Muthialpet Branch, Madras – 600 001, Tamilnadu, India

 

 

Facilities :

CC – Rs. 40.000 millions

LC - Rs. 60.000 millions

 

 

 

Banking Relations :

Satisfactory

 

 

Auditors :

 

Name :

T S Shivramakrishnan and Company

Chartered Accountants

No. 9, Archana Apartment, Plot No. 10, Sarangapani Street, T Nagar, Chennai – 600 017, Tamilnadu, India

 

Mr. Srinivas

Chartered Accountants

 

 

Sister Concerns :

v      DDS Steel Rolling Mills

v      SDS Steel

 

 

Other Directorship :

DDS Steel Rolling Mills Private Limited

U51420TN2006PTC060562

 

S D S Steels Private Limited

U51420TN2006PTC060563

 

 

 

 

 

 

 

 

 

CAPITAL STRUCTURE

 

Authorised Capital :

No. of Shares

Type

Value

Amount

1000000

Equity shares

Rs. 10/- each

Rs. 10.000 millions

 

Issued, Subscribed & Paid-up Capital :

No. of Shares

Type

Value

Amount

605000

Equity shares

Rs. 10/- each

Rs. 6.050 millions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FINANCIAL DATA

[all figures are in Rupees Millions]

 

ABRIDGED BALANCE SHEET

 

SOURCES OF FUNDS

 

 

31.03.2006

31.03.2005

SHAREHOLDERS FUNDS

 

 

 

1] Share Capital

 

6.050

6.050

2] Share Application Money

 

0.000

0.000

3] Reserves & Surplus

 

17.290

17.290

4] (Accumulated Losses)

 

(52.134)

(68.193)

NETWORTH

 

(28.794)

(44.853)

LOAN FUNDS

 

 

 

1] Secured Loans

 

78.022

100.538

2] Unsecured Loans

 

227.858

180.080

TOTAL BORROWING

 

305.880

280.618

DEFERRED TAX LIABILITIES

 

1.211

0.179

 

 

 

 

TOTAL

 

278.297

235.944

 

 

 

 

APPLICATION OF FUNDS

 

 

 

 

 

 

 

FIXED ASSETS [Net Block]

 

41.643

35.636

Capital work-in-progress

 

0.000

0.000

 

 

 

 

INVESTMENT

 

0.000

0.000

DEFERREX TAX ASSETS

 

0.000

0.000

 

 

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

 

 

 

Inventories
 

509.659

355.786

 

Sundry Debtors
 

92.802

100.924

 

Cash & Bank Balances
 

34.911

3.498

 

Other Current Assets
 

0.000

0.000

 

Loans & Advances
 

48.891

41.057

Total Current Assets
 

686.263

501.265

Less : CURRENT LIABILITIES & PROVISIONS
 

 

 

 

Current Liabilities
 

449.610

300.957

 

Provisions
 

0.000

0.000

Total Current Liabilities
 

449.610

300.957

Net Current Assets
 

236.653

200.308

 

 

 

 

MISCELLANEOUS EXPENSES

 

0.000

0.000

 

 

 

 

TOTAL

 

278.297

235.944

 

 

 

 

 

 

 

 

 

 

PROFIT & LOSS ACCOUNT

 

PARTICULARS

 

 

31.03.2006

31.03.2005

Sales Turnover

 

284.959

316.995

Other Income

 

107.364

86.699

Total Income

 

392.323

403.694

 

 

 

 

Profit/(Loss) Before Tax

 

17.264

(79.031)

Provision for Taxation

 

1.205

3.170

Profit/(Loss) After Tax

 

16.059

(82.201)

 

 

 

 

Expenditures :

 

 

 

 

Raw Material Consumed

 

133.040

360.866

 

Purchases made for re-sale

 

47.896

2.200

 

Consumption of stores and spares parts

 

13.659

13.527

 

Increase/(Decrease) in Finished Goods

 

7.792

1.902

 

Salaries, Wages, Bonus, etc.

 

2.817

1.432

 

Payment to Auditors

 

0.100

0.110

 

Interest

 

26.994

19.442

 

Insurance Expenses

 

0.591

0.459

 

Power & Fuel

 

81.866

57.725

 

Depreciation & Amortization

 

4.418

2.193

 

Other Expenditure

 

55.886

22.869

Total Expenditure

 

375.059

482.725

 

 

KEY RATIOS

 

PARTICULARS

 

 

 

31.03.2006

31.03.2005

PAT / Total Income

(%)
 

4.09

(20.36)

 

 
 

 

 

Net Profit Margin

(PBT/Sales)

(%)
 

6.06

(24.93)

 

 
 

 

 

Return on Total Assets

(PBT/Total Assets}

(%)
 

4.40

(19.58)

 

 
 

 

 

Return on Investment (ROI)

(PBT/Networth)

 
 

(0.60)

(1.76)

 

 
 

 

 

Debt Equity Ratio

(Total Liability/Networth)

 
 

(15.61)

(6.71)

 

 
 

 

 

Current Ratio

(Current Asset/Current Liability)

 
 

1.53

1.66

 

 

 

 

 

 

 

 

 

LOCAL AGENCY FURTHER INFORMATION

 

Trade References

 

v      TMT Industries – Chennai

 

Tulsian NEC Limited - Chennai

 

Form 8

 

This form is for

Modification of charge

Corporation identity number (CIN) or foreign company registrations number of the company 

U27101TN1985PLC011795

Name of the company

JAI BHAWANI STEEL ENTERPRISES LIMITED

Address

No. 91, Armenian Street, Chennai – 600 001, Tamilnadu, India

Type of Charges

v      Hypothecation

Particular of the charge holder 

Name: Union Bank of India

Address: Chennai Main Branch, 139, Broadway, Chennai – 600 108, Tamilnadu, India

Nature or description of the instrument creating or modifying the charge  

Hypothecation of goods agreement and machineries, dated 18.04.1988

Date of the instrument creating charge

18.04.1988

Amount Secure by the charge

Rs. 12.500 millions

Brief particulars of the principal terms and conditions and extent and operation of the charge

Interest Cash Credit- 6.50% OBR – 16.50%

Letter of Credit – Inland and Foreign usuals.

Term Loan 5% OBR 15% at quarterly rests as per Union Bank of India letter dated 02.05.1988

a)  Rs. 3.000 millions for Raw Materials, work in process and finished goods.

b)  Rs. 4.500 millions against Plant and Machinery.

c)  Rs. 5.000 millions against raw materials, finished goods in godowns and premises.

In case of acquisition of property, subjected to charge, furnish the details relating the existing charge on the property so acquired

v    Furniture and Fixtures

v    Book debts

v    Vehicles

Short particulars of the Property charged  

Raw materials at Plant and in transit/ imported / indigeneous work in process relatingf to M S Steel Ingots Castings ferro alloy Castings / ingots / Finished Goods.

Plant and Machinery existing and proposed such as medium frequency induction furnace crucibles/ cooling tower.

Whether any of the property or interest therein under reference is not registered in the name of the company 

Yes

Date of latest modification prior to the present modification

21.01.2006

Particulars of the present modification

By this modification

The credit facilities enjoyed by the company has been renewed / enhanced as detailed

 

Nature of Facility

Existing

(Rs. In millions)

Enhanced / Renewed

(Rs. In millions)

Cash Credit

25.000

25.000

Letter of credit(sub limit of inland LC – Rs. 12.000 millions)

60.000

60.000

Bank Guarantee

3.500

--

Working Capital Term Loan

--

30.000

Total

88.500

115.000

 

Terms and Conditions: Cash Credit (Hyp): Rate of Interest: BPLR + 3.50% i.e. 14.25% p.a. at margin 25% for stocks and Book debts, Letter of Credit: Margin 15%, Interest/ Commission, usual Working Capital Term Loan: Rate of interest BPLR + 3.50% p.a. 14.25% p.a. at repayable in 24 equal instalments for a tenure of two years of Rs. 1.450 millions each. Margin = 50% other terms and conditions as per the sanction letter and agreement dated 21.01.2006

 

Securities

Hypothecation by way of 1st charge in favour of the bank of all raw materials, semi finished goods, consumables stores and movables property of any kind including stocks such as steel scrape, MS ingots , moulds etc, Machinery such as induction furnace, electrical equipment etc now or at any time after belonging t othe company stored or to be stored in or about the company’s premises or godowns at Chennai belonging to the company.

 

All bookdebts, not older than 90 days ,outstandings, monies, deposits, receivables, claims and bills, contracts, securities, investments which are now due and owing to the company from time to time during the continuance of this security.

 

Extension of equitable mortgage by way of deposit of title deeds of the following property owned by the company to secure the above enhanced credit facilities and interest, cost charges and other expenses which may be debited to the account from time to time.

 

Description of the property mortgaged

Land in all admeasuring 4.11 acres in various Sy. Nos. 197/2B, 197/2A2, 185 (Part), 187/2 and 196 (Part) at Panjetty Village, Ponnery Talik, Thiruvallur District.

All other terms and conditions of the original charge and subsequent modification remains unchanged.

 

Form 8

 

Name of the company

JAI BHAWANI STEEL ENTERPRISES LIMITED

Presented By

Mrs. Sangeeta Saraf, Director

1) Date and description of instrument creating the 

    change

20.12.1991

Equitable mortgage by deposit of title deeds evidenced by receipt from Union Bank of India, Madras Main Branch dated 20.12.1991

2) Amount secured by the charge/amount owing on 

    the securities of charge

Cash Credit – Rs. 4.000 millions

Letter of Credit – Rs. 30.000 millions

Bank Guarantee – Rs. 2.500 millions

3) Short particular of the property charged. If the

    property acquired is subject to charge, date of   

    the acquired of the property should be given

0.28% undivided share in the immovable property bearing survey No. 1413/1, and 1413/2 of Teynampet Village Situated at No. 560 – 562, Anna Salai, Madras – 600 018, Tamilnadu, India

4) Gist of the terms and conditions and extent and

    operation of the charge.

Collateral security for the amounts advanced by Union Bank of India towards working capital.

5) Name and Address and description of the

    person entitled to the charge.

Union Bank of India

Madras Main Branch, 139, Broadway, Madras – 600 108, Tamilnadu, India

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CMT REPORT (Corruption, Money Laundering & Terrorism]

 

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

 

1]         INFORMATION ON DESIGNATED PARTY

No records exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

 

2]         Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

 

3]         Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

 

4]         Record on Financial Crime :

            Charges or conviction registered against subject:                                                  None

 

5]         Records on Violation of Anti-Corruption Laws :

            Charges or investigation registered against subject:                                                          None

 

6]         Records on Int’l Anti-Money Laundering Laws/Standards :

            Charges or investigation registered against subject:                                                          None

 

7]         Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

 

8]         Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

 

9]         Compensation Package :

The 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.

 

The 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. 42.78

UK Pound

1

Rs. 85.51

Euro

1

Rs. 67.90

 

 

SCORE & RATING EXPLANATIONS

 

SCORE FACTORS

 

RANGE

POINTS

HISTORY

1~10

6

PAID-UP CAPITAL

1~10

6

OPERATING SCALE

1~10

6

FINANCIAL CONDITION

 

 

--BUSINESS SCALE

1~10

6

--PROFITABILIRY

1~10

6

--LIQUIDITY

1~10

6

--LEVERAGE

1~10

6

--RESERVES

1~10

6

--CREDIT LINES

1~10

6

--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

NO

--AFFILIATION

YES/NO

NO

--LISTED

YES/NO

NO

--OTHER MERIT FACTORS

YES/NO

YES

TOTAL

 

54

 

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

 

 

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions