MIRA
INFORM REPORT
|
Report Date : |
24.07.2008 |
IDENTIFICATION
DETAILS
|
Name : |
TCP LIMITED |
|
|
|
|
Registered
Office : |
TCP Saptagiri Bhavan,
10, Karpa Gambalnagar, Luz Church Road, Mylapore, Chennai – 600 004, Tamil
Nadu |
|
|
|
|
Country : |
India |
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|
|
Financials (as
on) : |
31.03.2007 |
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|
|
Date of
Incorporation: |
08.06.1971 |
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|
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Com. Reg. No.: |
5999 |
|
|
|
|
CIN No.: [Company Identification
No.] |
L24200TN1971PLC005999 |
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|
|
|
TAN No.: [Tax Deduction & Collection
Account No.] |
CHET00143D |
|
|
|
|
PAN No.: [Permanent Account No.] |
AAACT3615K |
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|
|
|
Legal Form : |
A closely held Public Limited Liability
Company |
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|
|
|
Line of Business
: |
Manufacturer of Chemical Plants and Power
Plants |
RATING &
COMMENTS
|
MIRA’s Rating : |
Aa |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
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 |
|
Maximum Credit Limit : |
USD 6435600 |
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|
|
|
Status : |
Good |
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|
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a well – established and reputed company having fine track.
Available information indicates high financial responsibility of the company.
Trade relations are fair. Fundamentals are strong and healthy.
Payments are reported as usually correct and as per commitments. The company can be considered good for any normal business dealings at
usual trade terms and conditions. |
INFORMATION PARTED
BY
|
Name : |
Mr. Shridhar |
|
Designation : |
DGM Purchse Manager |
|
Contact No.: |
91-44-24991518 |
|
Date : |
23.07.2008 |
LOCATIONS
|
Registered Office : |
TCP Saptagiri Bhavan, 10, Karpa Gambalnagar, Luz Church
Road, Mylapore, Chennai – 600 004, Tamil Nadu, India |
|
Tel. No.: |
91-44-4991476/24994018 |
|
Fax No.: |
91-44-24992435 |
|
E-Mail : |
|
|
Website : |
|
|
Area : |
7000 Sq ft |
|
Location : |
Owned |
|
|
|
|
Factory: |
Kalrai Kudai Village, Koviloor, Sivaganga, District TN – 630
307, Tamil Nadu, India |
|
Area : |
25 Aq Sq ft |
|
Location : |
Owned |
|
|
|
|
Power Plant: |
Chennai Gupum, Pondi, Tamil Nadu, India |
DIRECTORS
|
Name : |
Mr. M Ethurajan |
|
Designation : |
Director |
|
Address : |
110, Radhakrishnan Salai, Mylapore, Chennai – 600 004, Tamil Nadu, India |
|
Date of Birth/Age : |
65 years (01.08.1934) |
|
|
|
|
Name : |
Mr. V R Venktaachalam |
|
Designation : |
Director |
|
Address : |
25, Sir C. V. Raman Salai, Alwarrpet, Chennai – 600 018,
Tamil Nadu, India |
|
Date of Birth/Age : |
47 years (09.04.1960) |
|
Qualification: |
Graduation |
|
|
|
|
Name : |
Mr. A S Thillainayagam |
|
Designation : |
Director |
|
Address : |
27th Street, Gopalapuram, Chennai – 600 086, Tamil Nadu, India |
|
Date of Birth/Age : |
47 years (17.02.1952) |
|
|
|
|
Name : |
Mr. M E Shanmugam |
|
Designation : |
Director |
|
Address : |
110, Dr. Radhakrishnan Salai, Mylapore, Chennai – 600 004, Tamil Nadu, India |
|
Date of Birth/Age : |
32 years (14.06.1967) |
|
|
|
|
Name : |
Mr. V Rajasekaran |
|
Designation : |
Director |
|
Address : |
Plot 499, 4th Sector, 18th Street, K. K. Nagar, Chennai – 600 078, Tamil Nadu, India |
|
Date of Birth/Age : |
55 years (06.11.1952) |
|
Qualification: |
M.Tech, MBA |
|
|
|
|
Name : |
Mr. Aravind Nandagopal |
|
Designation : |
Director |
|
Address : |
6, Rutland Gate, 6th Street, Chennai – 600 006, Tamil Nadu, India |
|
Date of Birth/Age : |
24 years (06.04.1975) |
|
|
|
|
Name : |
Mr. Natrajan Nandagopal |
|
Designation : |
Director |
|
Date of Birth/Age : |
31 years (21.12.1968) |
|
|
|
|
Name : |
Ms. Radha Venkataachalam |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. M. Nandagopal |
|
Designation : |
Director |
|
Address : |
6, Rutland Gate, 6th Street, Nungambakkam,
Chennai – 600 006, Tamil Nadu, India |
|
Date of Birth/Age : |
60 years (09.06.1939) |
KEY EXECUTIVES
|
Name : |
Mr. A Sampath |
|
Designation : |
Company Secretary |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer of Chemicals and Power Plants |
|
|
|
|
Products : |
· Sodium Hydrosulphite · Liquid Sulphur Di-Oxide · Sodium Formaldehyde Sulphoxylate - Product Data - Tangolite |
|
|
|
|
Exports : |
|
|
Countries : |
US, Thaiwan, Pakistan |
|
|
|
|
Imports : |
|
|
Products : |
Sodium Formet |
|
Countries : |
Spain, Taiwan, Switzerland |
|
|
|
|
Terms : |
|
|
Selling : |
Cash |
|
|
|
|
Purchasing : |
Credit (180 Days) |
GENERAL
INFORMATION
|
Customers : |
|
|
|
|
|
No. of Employees : |
50 (In Office), 180 (In Factory), 100 (In
Branches) Total: 330 |
|
|
|
|
Bankers : |
· Allahabad Bank · Global Trust Bank · Karnataka Bank
|
|
|
|
|
Facilities : |
OD Limit: Working Capital |
|
|
|
|
Banking
Relations : |
Good |
|
|
|
|
Auditors : |
|
|
Name : |
T. Selvaraj & Company Chartered Accountants |
|
Address : |
36, Dewan Rama Road, Purasa Walkam, Chennai – 600 084,
Tamil Nadu, India |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
12000000 |
Equity Shares |
Rs. 10/- each |
Rs.120.000 millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
5031909 |
Equity Shares |
Rs. 10/- each |
Rs.50.319
millions |
FINANCIAL DATA
[all figures are in Rupees Millions]
|
Particulars |
|
|
31.03.2008 |
|
Sales Turnover |
|
|
1800.000 |
Expected Sales (2008-09) : Rs.2000.000
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
50.300 |
50.300 |
50.300 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
1558.600 |
1378.300 |
1184.100 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
1608.900 |
1428.600 |
1234.400 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
953.000 |
1024.800 |
492.700 |
|
|
2] Unsecured Loans |
392.700 |
380.200 |
472.600 |
|
|
TOTAL BORROWING |
1345.700 |
1405.000 |
965.300 |
|
|
DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
2954.600 |
2833.600 |
2199.700 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
906.000 |
987.200 |
868.400 |
|
|
Capital work-in-progress |
0.000 |
6.300 |
24.900 |
|
|
|
|
|
|
|
|
INVESTMENT |
953.500 |
850.200 |
100.900 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
636.900
|
525.800 |
505.800 |
|
|
Sundry Debtors |
374.500
|
379.800 |
330.700 |
|
|
Cash & Bank Balances |
3.900
|
3.700 |
7.800 |
|
|
Other Current Assets |
0.000
|
0.000 |
0.000 |
|
|
Loans & Advances |
886.900
|
695.100 |
964.700 |
|
Total
Current Assets |
1902.200
|
1604.400 |
1809.000 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
632.200
|
466.800 |
483.300 |
|
|
Provisions |
174.900
|
147.700 |
120.200 |
|
Total
Current Liabilities |
807.100
|
614.500 |
603.500 |
|
|
Net Current Assets |
1095.100
|
989.900 |
1205.500 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
2954.600 |
2833.600 |
2199.700 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
Sales Turnover |
1953.800 |
2002.800 |
1941.000 |
|
|
Other Income |
97.100 |
43.800 |
36.700 |
|
|
Total Income |
2050.900 |
2046.600 |
1977.700 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
213.300 |
314.000 |
351.700 |
|
|
Provision for Taxation |
[25.900] |
62.400 |
64.700 |
|
|
Profit/(Loss) After Tax |
239.200 |
251.600 |
287.000 |
|
|
|
|
|
|
|
|
Export Value |
14.494 |
29.926 |
NA |
|
|
|
|
|
|
|
|
Import Value |
872.646 |
1182.738 |
NA |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Administrative Expenses |
67.600 |
68.400 |
76.600 |
|
|
Salaries, Wages, Bonus, etc. |
74.600 |
60.400 |
58.800 |
|
|
Interest |
105.500 |
106.000 |
55.700 |
|
|
General & Distribution Expenses |
1351.400 |
1256.500 |
1212.700 |
|
|
Power & Fuel |
89.900 |
90.700 |
91.100 |
|
|
Depreciation & Amortization |
133.900 |
135.600 |
117.300 |
|
|
Other Expenditure |
14.700 |
15.000 |
13.800 |
|
Total Expenditure |
1837.600 |
1732.600 |
1626.000 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2007 |
30.09.2007 |
31.12.2007 |
|
Type |
1st Quarter |
2nd Quarter |
3rd Quarter |
|
Sales
Turnover |
464.100 |
515.600 |
459.500 |
|
Other
Income |
8.500 |
19.000 |
8.600 |
|
Total
Income |
472.600 |
534.600 |
468.100 |
|
Total
Expenditure |
356.300 |
419.500 |
407.900 |
|
Operating
Profit |
116.300 |
115.100 |
60.200 |
|
Interest |
27.900 |
27.200 |
33.400 |
|
Gross
Profit |
88.400 |
87.900 |
26.800 |
|
Depreciation |
29.300 |
29.300 |
36.300 |
|
Tax |
7.100 |
7.100 |
-2.100 |
|
Reported
PAT |
55.700 |
55.300 |
-7.400 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
PAT / Total Income |
(%) |
11.66
|
12.29 |
14.51 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
10.91
|
15.67 |
18.11 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
5.67
|
12.08 |
12.54 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.13
|
0.22 |
0.29 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
1.33
|
1.41 |
1.27 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
2.36
|
2.61 |
2.99 |
LOCAL AGENCY
FURTHER INFORMATION
Unaudited Financial Results For the Quarter Ended
(Rs. in millions)
|
Particulars |
Quarter Ended |
Year Ended |
||
|
|
31-Mar-08(UnAudited) |
31Mar 07(Audited) |
31-Mar- 08(UnAudited) |
31-Mar-07(Audited) |
|
Net Sales / Income from Operation |
537.859 |
420.246 |
1995.352 |
1887.535 |
|
Other Income (Net) |
2.239 |
8.248 |
38.290 |
46.101 |
|
Total Income(1+2) |
540.098 |
428.494 |
2033.642 |
1933.636 |
|
Expenditure: |
|
|||
|
(Increase)/Decrease in stock in trade |
(2.119) |
(28.624) |
26.551 |
(42.305) |
|
Consumption of Raw materials |
404.743 |
315.021 |
1305.491 |
1218.997 |
|
Power & Fuel |
40.363 |
23.012 |
119.417 |
89.941 |
|
Duty on finished goods |
17.912 |
(49.983) |
64.593 |
7.210 |
|
Repairs & Maintenance/ Plant and Machinery |
11.498 |
6.753 |
45.328 |
42.116 |
|
Employees cost |
20.844 |
30.914 |
81.595 |
83.402 |
|
Depreciation |
33.879 |
34.552 |
128.711 |
133.912 |
|
Other expenditure |
17.880 |
28.025 |
70.014 |
92.124 |
|
|
|
|
|
|
|
Total |
545.000 |
359.670 |
1841.700 |
1625.396 |
|
Interest (Net) |
36.834 |
19.510 |
125.369 |
94.810 |
|
Net Profit (+) / Loss (-) from ordinary Activities before tax (3)-(4+5+6) |
(41.736) |
49.313 |
66.574 |
213.430 |
|
Tax Expense |
(12.375) |
(35.774) |
(7.676) |
(25.732) |
|
Net Profit (+) / Loss (-) from ordinary activities after tax (7-8) |
(29.361) |
85.088 |
74.250 |
239.163 |
|
Net Profit (+) / Loss (-) for the period (9-10) |
(29.361) |
85.088 |
74.250 |
239.163 |
|
Paid up equity share capital (Face value Rs 10/- per share) |
50.319 |
50.319 |
50.319 |
50.319 |
|
Reserves excluding revaluation reserves |
0.000 |
0.000 |
1632.888 |
1558.638 |
|
|
||||
|
Earnings Per Share
(E P S) |
|
|
|
|
|
a. Basic and diluted EPS before Extra Ordinary Items for the period, for the year to date and for the previous year ( Not to be Annualised) |
0.000 |
4.753 |
1.476 |
4.753 |
|
b. Basic and diluted EPS after Extra Ordinary Items for the period, for the year to date and for the previous year ( Not to be Annualised) |
0.000 |
4.753 |
1.476 |
4.753 |
|
|
|
|
|
|
|
Public Shareholding |
|
|
|
|
|
- Number of Shares |
12,72,988 |
12,72,988 |
12,72,988 |
12,72,988 |
|
- Percentage of Shareholding |
25.30 |
25.30 |
25.30 |
25.30 |
Statement Of Segment Wise Quarterly Result (Revenue, Results and
capital employed)
(Rs.In Millions)
|
PARTICULARS |
Quarter Ended |
Year Ended |
|||
|
|
31.03.2008(Unaudited) |
31.03.2007(Audited) |
31.03.2008(Unaudited) |
31.03.2007(Audited) |
|
|
SEGMENT REVENUE: |
|
|
|
|
|
|
A. |
Chemical Division |
155.452 |
41.381 |
585.636 |
468.188 |
|
B. |
Power Division |
385.849 |
397.556 |
1451.561 |
1489.238 |
|
C |
Biomass Division |
10.231 |
0.000 |
19.346 |
0.000 |
|
D. |
others |
0.800 |
0.454 |
3.200 |
3.694 |
|
Total |
552.332 |
439.390 |
2059.743 |
1961.120 |
|
|
Less: |
InterSegmentRevenue |
12.234 |
10.896 |
26.101 |
27.484 |
|
|
From Operations |
540.098 |
428.494 |
2033.642 |
1933.636 |
|
SEGMENT RESULTS: |
|
|
|
|
|
|
A. |
Chemical Division |
(11.820) |
(15.067) |
(13.878) |
10.194 |
|
B. |
Power Division |
15.220 |
84.605 |
227.473 |
296.447 |
|
C. |
Biomass Division |
(8.626) |
0.000 |
(23.114) |
0.000 |
|
D. |
Others |
0.326 |
(0.716) |
1.463 |
1.599 |
|
TOTAL |
(4.900) |
68.823 |
191.943 |
308.240 |
|
|
Less: |
: Interest |
36.834 |
19.509 |
125.369 |
94.810 |
|
Total Profit Before Tax |
(41.734) |
49.313 |
66.574 |
213.430 |
|
|
CAPITAL EMPLOYED: |
|
|
|
|
|
|
A. |
Chemical Division |
1728.795 |
1798.104 |
1728.795 |
1798.104 |
|
B. |
Power Division |
(363.480) |
(224.801) |
(363.480) |
0.000 |
|
C. |
Biomass Division |
274.067 |
0.000 |
274.067 |
0.000 |
|
D. |
Others |
35.588 |
35.854 |
35.588 |
35.654 |
|
Total |
1674.969 |
1608.957 |
1674.969 |
1608.957 |
|
CODE OF CONDUCT:
Members of the Board and the Senior
Management, shall
a) Always act in the best interest of the
Company and its stakeholders.
b) Adopt the highest standards of personal ethics,
integrity, confidentiality and discipline in dealing with all matters
relating to the Company.
c) Apply them
diligently and objectively in discharging their responsibilities and contribute
to the conduct of the business and the progress of the
Company, and not be associated simultaneously with competing organizations
either as a Director or in any managerial or advisory capacity,
without the prior approval of the Board.
d) Always adhere
and conform to the various statutory and mandatory regulations/guidelines
applicable to the operations of the Company avoiding
violations or non-conformities.
e) Not derive
personal benefit or undue advantages (financial or otherwise) by virtue of
their position or relationship with the Company, and for this
purpose
i) shall adopt total transparency in their
dealings with the Company.
ii) shall disclose
full details of any direct or indirect personal interest in
dealings/transactions with the Company.
iii) shall not be party to transactions or decisions involving conflict between
their personal interest and the Company's interest.
f) Conduct themselves and their activities outside the Company in such
manner as not to adversely affect the image or reputation of the Company.
g) Inform the Company immediately if there is any personal development
(relating to his/her business/professional
Activities) which could be
incompatible with the level and stature of his position
and responsibility with the Company.
h) Bring to the attention of the Board, Chairman or the Managing Director as
appropriate, any information or development either within the Company
(relating to its employees or other stakeholders) or
external, which could impact the Company's operations, and which in the normal
course may not have come to the knowledge the
Board/Chairman or Managing Director.
i) Always abide by the above Code of Conduct, and shall be accountable to the
Board for their actions/violations/defaults.
NOTE:
1. The Net Profit for the present quarter
shown above is inclusive of Profit derived from Generation of Power which is
exempted to the extent provided under Sec 801A of Income Tax Act, 1961 and is
exclusive of provision for dimunition in value of investment.
2. The above statement was approved at the meeting of the Board of Directors
held on 28th April, 2008.
3. Provision for taxation has been worked out as per provisions of Sec 115 JB
of the Income Tax Act, 1961.
4. The Segment report has been prepared in accordance with the Accounting
Standard 17 "Segment Reporting" issued by the Institute of Chartered
Accountants of India and guidelines issued by SEBI
5. During the Quarter, no complaints were received from shareholders and there
are no complaints outstanding as of date.
6. The Audit Committee has reviewed the results and recommended for board
approval.
7. The Impect of the revised Accounting Standard 15 "Employee
benefits" issued by ICAI effective from 01.04.2007 will be considered at
the end of the year.
8. The Above financial statements are subjected to limited review by the
Statutory Auditors of the Company.
9 The provision results shown above includes performance of our New Biomass
Division which was synchronised on 30th Sep 2007
10. The reduction
in profit is on account of unprecedented hike in the price of raw materials.
BIODATA
The company was incorporated on 8th June
1971 as a Joint Sector Unit with Tamil Nadu Industrial Development Corporation
Limited(TIDCO) and has set up its Plant at Karaikudi,a notified backward area
for manufacture of 4600 MTs of Sodium Hydrosulphite in technical collaboration
with Mitsubishi Corporation, Japan. Gradually the capacity of Sodium
Hydrosulphite was increased to 9000 MT as on March,2003.
The Company has also put a Liquid Sulphur Dioxide Plant of capacity of 4950 MTs
being the captive plant for manufacture of Sodium Hydrosulphite,in technical
collaboration with M/s Garbato Impianti Chimici s.r.l.Milano. Apart from its
captive plant for SHS,the Company has also put an additional Sulphur Dioxide Plant
for supply of So2 to Refineries and to augment the existing production of
Sodium Hydrosulphite.
The Sodium Hydrosulphite manufactured by the Company is being marketed
throughout the length and breadth of the country.
In 1998 the company made diversification by entering into Coal based Power
Project at a cost of Rs.109.84 crores. The total capacity was 63.5 MW. The
project was financed by ICICI Term loans. The Company was awarded ISO-9002 by
Det Norske Vertias,The Netherlands.
In 2001-2002 the company made rights issue of 2 equity shares for every 1
equity share on par and in lieu of this the share capital stands increased to
Rs.50.300 millions. The company has been marketing its product abroad in
countries like USA, UK, Spain, Italy etc.
SEGMENTWISE /
PRODUCTWISE PERFORMANCE PRODUCTION:
CHEMICALS:
Sodium
Hydrosulphite:
The production of Hydrosulphite showed an increase of 6.5% during the
year under review. The company produced 10,085 MTs as against 9,469 MTs last
year.
Liquid Sulphur Dioxide:
During the year the Company had produced 9,306 MTs of Liquid Sulphur
Dioxide as against 9,207 MTs last year representing an increase of 1.08% due to
increased production of Sodium Hydrosulphite.
Sulphoxylates:
The combined production of Sulphoxylates during the year dwindled from 259
MTs. to 85 MTs due to unprecedented hike in Zinc prices, the main raw material,
and fetching meager end price. Therefore production was tailored to the market
demand.
RECOVERY SALTS:
The trisalt production has shown a marginal decline from 3,463 MTs to
3,458 MTs thereby registering a marginal decline of 0.14%.
ELECTRIC
POWER:
Electric Power
Generation:
The company had generated 5,372 lakh units
of electricity as against 5,381 lakhs units last year, representing a very
marginal reduction of 0.16%. The average Plant Load Factor during the year
under review was 96.23%.
SALES:
CHEMICALS:
Sodium
Hydrosulphite:
The sale of Sodium Hydrosulphite during the year has declined by 8.01%
over that of last year. The decline is attributable to most of the Textile
Industries switching over to reactive colour processing from vat dyeing which
has adversely affected the sale. The Company had sold 9,195 MTs as against
9,996 MTs in the previous year.
Unethical import practices adopted by transactional companies to ward off the
advantages of anti-dumping duty and lowering of import duties had deleteriously
affected indigenous sales. Even the advantages of VAT system of tax in Tamil
Nadu have been neutralized. However, to tackle this difficult situation the
company has explored new market segments and has identified new applications
and usages for the products.
Liquid Sulphur
Dioxide:
The sale of Liquid Sulphur Dioxide during the year was 692 MTs as
against 1,092 MTs in the previous year and has registered a decline of 36.6%.
This decline in the sale of Liquid Sulphur Dioxide is attributable to closure
of major customer unit due to pollution problems.
Sulphoxylates:
The turnover of Sulphoxylates showed a deep downward trend of around 83% on
account of an unprecedented hike in the price of Zinc, by almost 60%, which is
a main raw material. Consequently the Company has to defer its production in
view of the high costs involved, slackening market and unremunerative price.
POWER:
During the year, the Company had exported to the TNEB 4844 lakh units of
electricity, which is the same of last year.
EXPORTS:
During the year, the Company had exported 396.4 MTs of Sodium Hydrosulphite
as against 827.90 MTs during the previous year showing a downward trend by
52.11%.
The exports to Greece and UAE registered a growth of 7.5% and 300%
respectively. The Company, in its relentless pursuit of developing newer
markets, had successfully explored a new market in Bahrain. The company has
been able to augment its deemed exports, during the year under review, to
35.22%. The merchandise exports declined by 72.09%.
The major factors that stifled the export performance are a) the dumping in the
overseas market, resorted to by China, thereby establishing the price and
adversely affecting the demand and supply position, b) the increased production
cost due to frequent increase in fuel price, c) general slackening of demand in
the overseas market, d) general consumer preference for more favourable payment
terms like payment on D.A. terms, e) sharp appreciation of Rupee against US
Dollar, and f) DEPB credit rate having been scaled down to 5% from 6%.
PROFITABILITY:
The
after tax profitability of the Company has declined by 16% as compared to last
year. The decline in profit was due to a) increased cost of coal required for
the Power Plant, b) payment of fringe benefit tax, c) deprivation of agreed
contracted price as against allowed, d) increase in interest cost and e)
general increase in raw materials required for the chemical plant, which had
impacted the margin.
FUTURE PLANS:
The Company's 6 MW Bio Mass Power Plant at its Factory at Karaikudi will
be commissioned by the first week of September 2007. The necessary approvals
from the Electricity Board and other statutory clearances have already been
obtained.
MANAGEMENT DISCUSSION AND
ANALYSIS:
Overall Economy
Review:
The Indian Economy witnessed an accelerated growth for the financial
year 2006-2007, with strong macro economic fundamentals. The growth rate was
9.2% in 2006-07 as compared to 9% in 2005-2006. The growth has been more
pronounced in the Service and the Manufacturing Sector. For the current year,
the GDP growth is already up in the range of 9.8% to 9.9%, as reported by the
Central Statistical Organization. The per capita income has grown by 8.4% as
against 7.74%. For the year 2006-2007, electricity generation grew by 7.2% as
compared to 5% in the previous year. The Infrastructure sector grew by 8.6% in
2006-2007 as compared to 6.2% in the previous year. The overall industrial
growth during 2006-2007 stood at 11.3% as compared to 8.2% in the preceding
year.
Industrial Structure and
Development:
The Economic Advisory Council has projected that, in the year 2007-2008,
the economy is expected to grow at 9.4% as compared to 9.2% in 2006-2007.
Inflation is likely to be contained at 4%. Due to strengthening of the rupee in
terms of U.S.$, it is projected that the export growth would slow down to 18%
from 21% The FDI inflow is expected to grow to U.S.$ 15 billion in 2007-2008
from U.S.$ 8.4 billion in 2006-2007.
The Industrial Output is estimated to grow by 10.6%. The prevalence of
favourable factors, such as, robust macro economic fundamentals, fiscal
consolidation, strong balance of payments position and an upsurge in
investments, are expected to maintain the growth momentum. Pre-emptive and
timely measures, reinforced with low and stable inflation and congenial
conditions for industrial expansion, would maintain the economic growth.
With several positive factors, such as the expected GDP growth of 9.4%, the
pro-active measures initiated by the Government, to achieve an expected
industrial growth of 10.6% (as estimated by Economic Advisory Council), a good
industrial development is expected in the current year.
Opportunities:
The Chemical Industry is holding a prime position with regard to the GDP
growth. It has contributed nearly 6% towards the GDP growth. The Industry
itself has achieved a growth rate of 15% in the year 2006-2007. This growth
would have been more had it not been affected by factors such as dumping by
transactional companies and reduced import tariffs. These factors contributed
to destabilise the indigenous market. The positive and proactive measures,
proposed to be taken by the Government, such as, increased export incentives,
grant of concessional pre/post shipment credits and levy of anti dumping duty,
would help to accelerate the growth of the Chemical Industry.
In the Power sector, the Electricity Act 2003 has brought in a number of
reforms and regulatory measures to improve operational efficiencies in the
generation and distribution of power. It also ensures uninterrupted Power
supply to meet the burgeoning demand-supply-gap. These measures would help to
achieve the growth target of 8 to 10% set for the power sector.
Outlook:
The Government has finalised and issued the Rural Electrification policy.
The objective of the policy is to provide electricity to all households by the
year 2009. The reform process envisages improving efficiencies in generation
and distribution of power, curbing transmission and commercial loss in the
distribution segment, fiscal sustenance of the sector, encouraging investments,
bringing competitive tariff for benefit of the consumers, and meeting the
burgeoning demand-supply gap. These measures are intended to help to achieve
the growth target of 8 to 10% set for the power sector.
Given the growing demand-supply gap, the power sector looks to be an attractive
investment area. With the Government's resolve to address issues concerning
distribution, granting expeditious clearances, allocation / linkages of fuel
and development of infrastructure facilities such as port, rail and road, the
power sector is all set to reach global efficiency levels, thereby attracting
foreign investments.
The Chemical Industry is poised for appreciable growth in exports in view of
the Government's proposal to increase duty draw back rate, levying of anti
dumping duty, granting pre/post shipment credits at concessional interest
rates. The growth of the user industries would indirectly contribute to
increased demand for the products and its profitability.
Considering the Government's positive approach for instituting the
aforesaid pro-active measures, the Company would be in a position to improve
its operational efficiencies and increase its profitability and contemplate
further expansion.
HUMAN RESOURCE
DEVELOPMENT AND INDUSTRIAL RELATIONS:
The company attaches considerable importance to Human Resource
Development (HRD) and harmonious Industrial Relations. The company continues to
nurture talent by systematic training programmes and sponsoring for Seminars,
which are aimed at knowledge enhancement, improvement of skills, leadership and
team building. The overall Industrial relations, during the year, were
cordial.
OTHER INFORMATION:
The company was incorporated on 8th June, 1971 at Chennai in Tamil
Nadu under the name Tamilnadu Chemical Products Limited and change its’ name to
TCP Limited.
INDUSTRY
The caustic soda industry, with a size of around Rs.36 bn, comprises
around 5% of the chemical process industry in India.
Caustic soda is manufactured/sold
in liquid (lye) or solid (flakes) form. It finds usage in diverse applications
such as in the manufacture of paper, alumina, man-made and cotton fibres, soaps/detergents and a host of chemicals.
Chlorine is a co-product and for every tonne of caustic soda manufactured, 0.88
tonnes of chlorine is produced. Chlorine is used in a number of applications
such as in the manufacture of PVC and several other organic/inorganic chemicals.
Soda ash, chemically known as Sodium Carbonate is a versatile inorganic
chemical with a wide variety of applications. It is largely used in the
manufacture of detergents, silicates and several downstream chemicals. The
domestic soda ash industry has been facing the onslaught of imports for quite
some time.
The industry is likely to continue to be a net importer although imports
may be lower in the coming year due to larger capacities in the domestic
market. The competitiveness of the industry will be severely tested as import
duties on the furnished products come down further and foreign major seek to
establish a toehold in the country.
WEBSITE DETAILS:
Promoters of the
Company
Subject was incorporated on 8th June 1971, as a Joint Sector Unit, with
the Tamil Nadu Industrial Development Corporation Limited (TIDCO).
In pursuance to the decision of the State Government to disinvest the
shares of the Joint Sector Unit held by TIDCO, in favour of private promoters,
the shares of the company were disinvested by TIDCO Limited., in favour of the
Udayar Group, with effect from 7th November 1986.
Products, Capacity
and Technical Know How
The company has set up its Plant for the manufacture of 4600 MT’s (re
endorsed from 3300 tonnes) of Sodium Hydrosulphite (SHS), with the technical
Know-how from the Mitsubishi Corporation of Japan, through the unique Sodium
Formate Route, adopted for the first time in India. The plant is located at
Karaikudi, a notified backward area, in Tamil Nadu state.
The product, Viz., Sodium Hydrosulphite, has a very wide application in
the industries like Textiles, Jaggery, Pharmaceuticals and Ceramics.
The Company has also set up a Plant for the manufacture of 4950 MT’s of
Liquid Sulphur Dioxide, as a captive plant, for the supply of Liquid Sulphur
Dioxide for the manufacture of Sodium Hydrosulphite (SHS), with the technical
Know-how from M/s Garbato Implanti Chimici s.r.l. Milano, Italy.
The company has also put up an additional Sulphur Dioxide Plant for the
supply of Sulphur Dioxide to Refineries and also to augment the supplies for
the production of Sodium Hydrosulphite.
The company has consistently achieved higher capacity utilization, which
is unique in any chemical industry.
Project Cost And
Financing
The project was implemented at a project cost of about Rs.80.000
millions. The commercial production commenced on 1st October 1978.
The project was initially financed by the All India Central Financial
Institutions by way of Equity participation, private placement of debentures,
and a Term Loan assistance of Rs.52.000 millions, with a share capital of
Rs.19.272 millions, which included Cumulative Redeemable Preference Shares of
Rs.2.500 millions. The Company has fully repaid the institutional Term loan
assistance of Rs.52.000 millions and has also redeemed the Cumulative
Redeemable Preference Shares of Rs.2.500 millions, within the time limit
prescribed for redemption. The company has obtained the central subsidy for
setting up the Plant in a notified backward area.
Product
Applications
The
product has got application in the following industries:
a)
Textile: As reducing agent or Dyeing Auxiliary in Vat Dyeing.
b) Food: As a preservative
c) Sugar/Jaggery: For purification as a
Bleaching Agent in the removal of organic and other impurities.
d) Pharmaceutical: As a Bleaching Agent in
the manufacture of certain Antibiotics and Analgesics.
e) Paper: Used as a Bleaching Agent in paper
and pulp industry.
f) Clay: Bleaching of clay for removing iron
impurities.
g) VAT: Manufacture of Vat Dyes.
h) Soap: Bleaching of Crude Soap.
i) Tanning of Leather: Used as a “Reducing
Agent” in the preparation of Chrome Tanned Leather.
Market
The Sodium Hydrosulphite manufactured by the company is being marketed
throughout the country. In view of the unique manufacturing process adopted by
the company, as compared to the process adopted by the competitors, the quality
of the product manufactured by the company is superior when compared to the
products of the competitors. Thus, the product manufactured by the company is
widely acclaimed as the best and is readily accepted in both the Indigenous and
the International markets.
ISO 9002
The company has been granted ISO 9002 Quality System Certificate by DET
NORSKE VERITAS, Netherlands. The company has also been given ISO 14001
(Environment Management System) for its Power Plant.
Export
The company is exporting its products to France, Spain, Italy, Germany,
U.K., Netherlands, U.S.A., and Indonesia and is earning valuable foreign
exchange. Considering the presence of multinational giants in the aforesaid
countries, marketing similar products, the consistent export performance by the
company is a significant achievement by the company and is a testimony to the
quality of its product
CMT REPORT
(Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts, India Prisons Service,
Interpol, etc.
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international anti-terrorism
laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE
GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE
RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.42.33 |
|
UK Pound |
1 |
Rs.84.32 |
|
Euro |
1 |
Rs.66.75 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
8 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
9 |
|
--LEVERAGE |
1~10 |
9 |
|
--RESERVES |
1~10 |
9 |
|
--CREDIT LINES |
1~10 |
8 |
|
--MARGINS |
-5~5 |
--- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
YES |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
75 |
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 |
|