MIRA
INFORM REPORT
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Report Date : |
12.06.2008 |
IDENTIFICATION
DETAILS
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Name : |
KIRLOSKAR ELECTRIC COMPANY LIMITED |
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Registered Office : |
Industrial Suburb, Rajaji Nagar, Bangalore – 560 010, Karnataka |
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Country : |
India |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
26.07.1946 |
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Com. Reg. No.: |
000415 |
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CIN No.: [Company
Identification No.] |
L85110KA1946PLC000415 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
BLRK04661G |
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PAN No.: [Permanent
Account No.] |
AABCK2721Q |
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Legal Form : |
It is a Public Limited Liability Company. The company's shares are listed on the Stock Exchanges. |
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Line of Business : |
Manufacturers of Electrical and Power Equipment. |
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 5000000 |
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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 part of Kirloskar group having fine track. The company
has improved its performance and is expected to wipe-off previous losses soon.
General financial position is good. Payments are reported as usually correct
and as per commitments. The company can be considered good for normal business dealings. |
LOCATIONS
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Registered Office : |
Industrial Suburb, Rajaji Nagar, Bangalore – 560 010, Karnataka, India |
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Tel. No.: |
91-80-2332 2111 / 2332 2771 |
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Fax No.: |
91-80-2332 2469 |
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E-Mail : |
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Website : |
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Corporate Office : |
Post Box No. 5555, Malleswaram West, Bangalore - 560 055, Karnataka, India. |
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Tel. No.: |
91-80-2332 2111 / 2332 2771/ 23374865/ 23378735 |
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Fax No.: |
91-80-2332 2469/ 23372448/ 23377706 |
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Factory : |
Belvadi Industrial Area, Mysore, Gokul Road, Hubli - 580 030, Karnataka, India |
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Tel. No.: |
91-821-2402522 / 2402540-3 |
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Fax No.: |
91-821-2402266 |
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Factory : |
Post Box No. 5555, Malleswaram West, Bangalore - 560 055, Karnataka, India. |
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Tel. No.: |
91-80-2839 4961 |
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Fax No.: |
91-80-2839 5473 |
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Factory : |
Post Box No. 112, Gokul Road, Hubli - 580 030, Karnataka, India |
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Tel. No.: |
91-836-2332771-3 |
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Fax No.: |
91-836-2331433 |
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Factory : |
Urwade At & Post Urwade, Dist. Pune, Maharashtra, India |
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Tel. No.: |
91-2139-336845 / 336915 |
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Fax No.: |
91-2139-22130 |
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Factory : |
Plot No. 6, Hirehalli Industrial Area, Tumkur - 572 168 |
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Tel. No.: |
91-816-23152-4 / 23104 |
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Fax No.: |
91-816-23105 |
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Factory : |
PB 2475, Hebbal, Bangalore - 560 024 |
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Tel. No.: |
91-80-2333 1151-3 / 2333 3446 |
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Fax No.: |
91-80-2333 2669 |
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Overseas Office : |
12 A – 1 and 2, jalan 4 / 109 E, Desa Business Park, Off. Jalan Desa – 58100, Kuala Lumpur, Malaysia |
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Tel No.: |
60-3-79840800 |
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Fax No.: |
60-3-79840801 |
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E-mail : |
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Overseas Office : |
20, Kramal Lane,
# 03 – 02, United House, Singapore - 0922 |
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Tel No.: |
65-67383732 /
6567384544 |
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Fax No.: |
65-67383731 |
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E-mail : |
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Overseas Office : |
P. O. Box 17208,
Jabel Ali Free Zone, Dubai, UAE |
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Tel No.: |
971-4-817304 |
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Fax No.: |
971-4-817305 |
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E-mail : |
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Branches : |
Located at : v Frankfurt v Germany v Kualalumpur v
Nairobi v
Ahmedabad v
Bangalore v
Bhuvaneshwar v
Chennai v
Cochin v
Coimbatore v
Durg v
Guwahati v
Hyderabad v
Indore v
Jaipur v
Jamshedpur v
Kolkata v
Lucknow v
Ludhiana v
Madurai v
Mumbai v
Nagpur v
Hubli v
Mysore v
Govenahalli |
DIRECTORS
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Name : |
Mr. Vijay R. Kirloskar |
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Designation : |
Chairman and Managing Director |
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Name : |
Mr. A S. Lakshmanan |
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Designation : |
Director |
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Name : |
Mr. S N. Agarwal |
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Designation : |
Director |
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Name : |
Mr. Anil Kumar Bhandari |
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Designation : |
Director |
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Name : |
Mr. Saroj J. Ghandy |
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Designation : |
Director |
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Name : |
Mr. V P Mahendra |
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Designation : |
Director |
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Name : |
Mr. Balasubramanian Mythilli |
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Designation : |
Director (IDBI Nominee) |
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Name : |
Mr. Ramesh D. Damle |
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Designation : |
Director (LIC Nominee) |
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Name : |
Mr. P S Malik |
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Designation : |
Joint Managing Director |
KEY EXECUTIVES
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Name : |
Mr. P Y Mahajan |
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Designation : |
Company Secretary |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
As on 31.03.2008
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Names of Shareholders |
No. of Shares |
Percentage of
Holding |
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(A) Shareholding
of Promoter Group2 |
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1. Indian |
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Individuals/ Hindu Undivided Family |
847079 |
2.55 |
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Bodies Corporate |
14673154 |
44.10 |
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Sub Total (A)
(1) |
15520233 |
46.65 |
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(B) Public
Shareholding |
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1. Institutions |
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Financial Institutions Banks |
58485 |
0.18 |
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Insurance Companies |
3713767 |
11.16 |
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Foreign Institutional Investor |
2166078 |
6.51 |
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Sub Total (B)
(1) |
59838330 |
17.85 |
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B (2) Non
Institutions |
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Bodies Corporate |
4798682 |
14.42 |
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Individuals – i. Individuals shareholders holding nominal share
capital up to Rs. 1 lakh |
4593386 |
13.81 |
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ii. Individual shareholders holding nominal share capital in excess of
Rs. 1 lakh |
435766 |
1.31 |
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NRIs |
77019 |
0.23 |
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OCBs |
1905401 |
5.73 |
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Sub Total (B)
(2) |
11810254 |
35.50 |
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Total Public
shareholding (B)=(B)(1) + (B) (2) |
17748584 |
53.35 |
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Total (A) + (B) |
33268817 |
100 |
BUSINESS DETAILS
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Line of Business : |
Manufacturers of Electrical and Power Equipment. |
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Products : |
v AC Motors v AC Generators v DC Motors v Tractions v Components of
Electric Machines v Electronics and
Switch Gears v DG Sets v Transformers v Servicing and
Spares |
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Exports: |
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Products : |
v Exports Motors v Generators v Transformers v Switchgears |
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Country : |
v Africa v Europe v Asian countries. |
PRODUCTION STATUS
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Particulars |
Unit |
Licensed
Capacity |
Installed
Capacity |
Actual
Production |
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Motors/ Alternators/ Generators |
MW |
2806* |
2806* |
8(-) |
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Transformers |
KVA |
NA |
NA |
1777101
(1161825) |
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Arc Welding & Resistance Welding Equipments with Aids and Accessories |
Nos |
1800 |
1800 |
-- |
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Controls for Alternators/ Generating sets, Variable Speed Drive Controls, Static Exciters and Inverters, Electronic Controls for Machine Tools, HV testers, Coolers, Stud Welders, Thermister Protection units and RF Induction Generators |
Units |
3,000* |
3,000* |
851 (769) |
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Industrial Heating Equipment such a Induction Heaters and Welders, Die Electric Heaters & Plastic Welders with associated handling equipment |
Nos. |
150* |
50* |
-- |
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Vertical Mechanical Comparator, Sigmasize Electronic Gauging Indicator, Sigmaflash electronic column guage, Sigmaster fixturing systems |
Nos. |
1,400 |
200 |
-- |
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Micro and Mini Computers |
Rs. in million |
100* |
80 |
-- |
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Industrial Electronic Voltage Regulators |
Nos. |
20,000 |
8,000 |
5341 (1206) |
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Uninterruptible Power Systems |
Nos. |
5,000* |
500 |
732 (777) |
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Metal Cutting including Grinding Machines |
Nos. |
300* |
150 |
-- |
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Machine tool accessories including digital readouts |
Nos. |
550* |
550 |
79 (57) |
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Printed Circuit Boards (**) |
Sq. mtrs. |
2,500* |
2,500* |
-- |
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Alternators |
Nos. |
191,500 |
78,000 |
-- |
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D G Sets |
Nos. |
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64 (14) |
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Circuit Breakers / Starters/ Contractors/ Switchboard* |
Nos |
$ |
|
859 (696) |
Notes:
1. (**) Registered with DGTD(*) on maximum
utilization (+) on single shift.
2. There is no change in installed capacity as
compared to the previous year.
3.(@) As certified by the Managing Director.
4. $ Standing in the name of Kirloskar Systems
Limited; whose switchgear business is taken over by the company.
5. The licenses relating to the rotating
machines group transferred to kaytee switchgear limited stand in the name of
the company.
6.* As per letter no. 3/24/2000 – PAB – IL
from department of Industrial policy and promotion , New Delhi dated 01.12.2004
GENERAL
INFORMATION
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No. of Employees : |
4000 |
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Bankers : |
v The Hongkong and Shanghai Banking Corporation Limited v Deutsche Bank v Bank of India v State Bank of Mysore v Bank of Baroda v State Bank of India v State Bank of Travancore v Standard Chartered Grindlays Bank Limited v Bank of Commerce, Kuala Lampur(Malaysia) |
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Facilities : |
Secured Loans
Un Secured Loans
Note: Fixed deposits include unclaimed deposits of Rs. 0.478 million (Previous Year Rs. 0.523 million) Amount falling due for payment within one year is Rs. 51.848 millions (Previous year Rs. 2.000 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 : |
Bangalore – 560 010, Karnataka, India |
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Memberships : |
Confederation of Indian Industry |
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Collaborators : |
v Peebles Electric Limited, U.K. o Transformers v Lovato, Italy o CNC Controls v AEG, Germany o Synchronous & Asynchronous Motors and Generators (5 MW to 20 MW), o Large DC motors v Ocrev, Italy o Cast Resin Transformers |
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Subsidiaries : |
v Best Trading & Agencies Limited, Bangalore v KEC North America Inc., United States of America |
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Parent Company : |
v Kirloskar Brothers Limited, Pune, Maharashtra, India |
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Associates : |
v Kirloskar Computer Services Limited v KEASI Robican Industrial Systems Limited v Kirloskar (Malaysia) Sdn. Bhd v Kirloskar Power Equipment Limited v Ravindu Motors Private Limited v Vijay Firms Private Limited v Sri Vijay Durga Investments and Agencies Private Limited v Vijay Jyoti Investment and Agencies Private Limited v Abhiman Trading Company Private Limited v Vimraj Investment Private Limited v Vijay Kirthi investment and Agencies Private Limited v Kirloskar Software Services |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
40,000,000 |
Equity Shares |
Rs. 10/- each |
Rs. 400.000 millions |
|
3,000,000 |
Preference shares |
Rs. 100/- each |
Rs. 300.000 millions |
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Total |
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Rs. 700.000 millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
31,268,817 |
Equity shares |
Rs. 10/-
each |
Rs. 312.688 millions |
|
1,200,000 |
Equity shares |
Rs. 100/-
each |
Rs. 120.000 millions |
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Total |
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Rs. 432.688 millions |
Note:
1. Equity shares include
a) 10,000 shares of face value of Rs. 0.100 million
allotted as fully paid-up pursuant to a contract without payment being received
in cash.
b) 6,679,572 shares of face value of Rs.
66.796 millions allotted as fully paid-up by way of bonus shares by
capitalisation of capital reserve, Capital Redemption Reserve, General Reserve
and Share Premium.
c)
6,000,000 shares were allotted during the year 2003-04 to IDBI on conversion of
preference share capital at face value as per the scheme of arrangement
approved by honorable High Court of Karnataka.
2. The Preference shares shall be redeemed in
3 annual installments on 30.09.2008, 30.09.2009 and 30.09.2010 respectively.
3. The Preference shares carry a cumulative
dividend of 7% p.a. w.e.f. 01.10.2001 payable cumulatively out of the profits
of the company. The rate of dividend can be increased to 9% p.a. by way of
payment of redemption premium subject to profitability and cash flows.
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 |
432.688 |
432.688 |
432.700 |
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2] Share Application Money |
60.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
675.541 |
675.541 |
309.800 |
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4] (Accumulated Losses) |
(149.444) |
(324.390) |
0.000 |
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NETWORTH |
1018.785 |
783.839 |
742.500 |
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LOAN FUNDS |
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1] Secured Loans |
244.294 |
176.073 |
201.000 |
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2] Unsecured Loans |
72.049 |
17.501 |
2.100 |
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TOTAL BORROWING |
316.343 |
193.574 |
203.100 |
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DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
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TOTAL |
1335.128 |
977.413 |
945.600 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
115.851 |
118.949 |
127.400 |
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Capital work-in-progress |
10.327 |
53.327 |
58.700 |
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INVESTMENT |
584.752 |
600.068 |
556.000 |
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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 |
229.727
|
217.961 |
135.500 |
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Sundry Debtors |
1378.923
|
1126.390 |
825.000 |
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Cash & Bank Balances |
413.668
|
139.434 |
217.800 |
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Other Current Assets |
0.000
|
0.000 |
0.000 |
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Loans & Advances |
387.329
|
253.968 |
105.000 |
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Total
Current Assets |
2409.647
|
1737.753 |
1283.300 |
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Less : CURRENT
LIABILITIES & PROVISIONS |
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Current Liabilities |
1763.766
|
1555.257 |
1128.700 |
|
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Provisions |
41.434
|
21.250 |
28.900 |
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Total
Current Liabilities |
1805.200
|
1576.507 |
1157.600 |
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Net Current Assets |
604.447
|
161.246 |
125.700 |
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MISCELLANEOUS EXPENSES |
19.751 |
43.823 |
77.800 |
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TOTAL |
1335.128 |
977.413 |
945.600 |
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PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
Sales Turnover |
5913.957 |
4140.246 |
3203.600 |
|
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Other Income |
24.277 |
19.717 |
127.600 |
|
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Total Income |
5938.234 |
4159.963 |
3331.200 |
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Profit/(Loss) Before Tax |
191.446 |
45.300 |
8.800 |
|
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Provision for Taxation |
16.500 |
4.000 |
0.000 |
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Profit/(Loss) After Tax |
174.946 |
41.300 |
8.800 |
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Earnings in Foreign Currency : |
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|
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|
FOB Value of Exports |
0.176 |
0.145 |
0.000 |
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Remittances from overseas offices (Net) |
0.009 |
0.002 |
0.000 |
|
Total Earnings |
0.185 |
0.147 |
0.000 |
|
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Imports : |
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|
|
|
|
|
Raw Materials |
0.000 |
0.015 |
0.000 |
|
|
Stores & Spares |
0.041 |
0.031 |
0.000 |
|
|
Capital Goods |
0.001 |
0.000 |
0.000 |
|
Total Imports |
0.042 |
0.046 |
0.000 |
|
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Expenditures : |
|
|
|
|
|
|
Administrative Expenses |
0.288 |
0.259 |
0.286 |
|
|
Purchases made for re-sale |
5.309 |
3.755 |
0.087 |
|
|
Interest |
0.033 |
0.018 |
0.025 |
|
|
Depreciation & Amortization |
0.123 |
0.063 |
8.100 |
|
|
Other Expenditure |
5741.035 |
4110.568 |
3313.902 |
|
Total Expenditure |
5746.788 |
4114.663 |
3322.400 |
|
QUARTERLY /
SUMMARISED RESULTS
|
PARTICULARS |
30.06.2007 |
30.09.2007 |
31.12.2007 |
|
Type |
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
|
Sales Turnover |
1415.500 |
1819.000 |
1923.900 |
|
Other Income |
0.800 |
8.300 |
4.600 |
|
Total Income |
1416.300 |
1827.300 |
1928.500 |
|
Total Expenditure |
1342.700 |
1730.100 |
1833.800 |
|
Operating Profit |
73.600 |
97.200 |
94.700 |
|
Interest |
8.200 |
10.000 |
7.300 |
|
Gross Profit |
65.400 |
87.200 |
87.400 |
|
Depreciation |
7.300 |
8.300 |
7.600 |
|
Tax |
5.000 |
11.500 |
12.000 |
|
Reported PAT |
53.100 |
67.400 |
67.800 |
KEY RATIOS
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt Equity Ratio |
0.31
|
0.28 |
0.40 |
|
Long Term Debt Equity Ratio |
0.12
|
0.08 |
0.13 |
|
Current Ratio |
1.10
|
1.00 |
0.91 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
19.05
|
12.70 |
8.07 |
|
Inventory |
24.30
|
22.29 |
24.44 |
|
Debtors |
4.94
|
4.39 |
4.38 |
|
Interest Cover Ratio |
4.81
|
3.45 |
(0.36) |
|
Operating Profit Margin (%) |
4.06
|
2.26 |
(0.03) |
|
Profit Before Interest and Tax Margin(%) |
3.91
|
2.06 |
(0.29) |
|
Cash Profit Margin(%) |
2.98
|
1.57 |
(0.84) |
|
Adjusted Net Profit Margin(%) |
2.83
|
1.37 |
(1.09) |
|
Return on Capital Employed(%) |
18.83
|
7.36 |
(0.95) |
|
Return On Net Worth(%) |
18.61
|
6.23 |
(5.01) |
LOCAL AGENCY FURTHER
INFORMATION
History
The company was incorporated on 26th July, 1946 at Bangalore in Karnataka having Company Registration Number 415.
Subject was promoted by Kirloskar Brothers Limited, Pune, with technical and financial participation of well known British Company, i.e. Brush Electrical Engineering Company Limited, Loughborough, England, which is now a member of Hawker Siddeley Group.
Incorporated in Jul ’46, the Company acquired Voltas Transformers, Pune thus establishing its presence in the cast resin transformers market. Later, it has tied up with Wind Energy Group, UK for manufacture of Wind Turbine Generators. The Company completed strategic acquisitions (at a cost of Rs., 80.000 millions) of Kirloskar Systems in Dec 15, ’97 with a aim of synergy of activity of transformer business with switchgear business. The Company has undertaken a business restructuring activity and thereby it has transferred its Rotating Machines Group business to it subsidiary Kaytee Switchgear Private Limited.
Its main activity is manufacture and sale of a diverse range of electrical and electronic equipment – AC induction motors, transformers, AC generators, DC machines, control equipments and systems, power electronic products, instrumentation, automation and controls and industrial electronic equipment. The projects and systems division of the company has specialised in executing system packages for large industries like steel, fertilisers, cement, sugar and other core sectors. The company has developed its first 40-MVA transformer. It participated in the development of specialised mobile power set for the Prithvi missiles project, supplied and commissioned 10 cu mtr of excavator electric’s, the biggest in the country and a total electric system package to the Maniyar Mini Hydel plant.
The takeover of Voltas Transformers, Pune, has enabled the company to establish a significant presence in the cast resin transformers market. The company has recently diversified into non-conventional energy by tying up with the Wind Energy Group, United Kingdom, for manufactures of wind turbine generators.
The company acquired the business from Kirloskar Systems Limited from 15th December, 1997 at a cost of Rs. 80 millions, considering the synergy of switchgear business with transformers will result in addition of the company turnover.
In 1999-2000, KEC North American, Inc. United States of America, became a subsidiary of the company for marketing and distribution organisation in North America through the distribution channel of EASA (member of the Electrical Apparatus Service Association) shops.
The proposal to form Joint Venture with a Singapore based company did not fructify as the company has started renegotiating the terms and the company has decided not to go ahead with the proposed Joint Venture.
Business
The company is engaged in Manufacturing, Importing and Exporting of A/C Motors upto 20000 kW, Generators upto 20000 kVA, DC Machines upto 3000 kW, Transformers upto 50000 kVA, Traction Equipment & Systems, Low and Medium voltage Switchgears, Contractors, Factory Automation products to include Digital Readouts, AC/DC Servo Drives, Compact CNC Systems and total solutions for machining automation, Inverters, Converters and UPS systems.
COMPANY
PERFORMANCE:
During the year under report, the Company has achieved a turnover (Gross) of
Rs. 6.19 billion (previous year Rs. 4.28 billion). The operations have resulted
in a net profit of Rs. 174.950 million (previous year Rs. 41.300
million).
INDUSTRY OUTLOOK:
The Government of India have set up an ambitious mission of 'Power for all by
2012'. The 11th Plan envisages additional capacity of 60000 MW, which will
require considerable supply support from the Electrical Industry. The Industry
grew at an average rate of about 30% during the last couple of years and is
expected to continue its momentum in the near future. The Company manufactures
and deals in major products of Electrical Industry.
The Company is a major player in the Electrical Industry and has a very good brand image. It has a large and established network of dealers. The Company has taken various steps to improve its operational efficiency to be more competitive. In the situation, the Company expects to fare well in the current year, barring unforeseen circumstances.
SUBSIDIARIES:
The business of the company's subsidiary KEC North America, INC, USA has been closed.
KAYTEE SWITCHGEAR
LIMITED:
Kaytee Switchgear Limited, the subsidiary has achieved a turnover (Gross) of
Rs. 3.82 billion as against Rs. 2.81 billion in the previous year, showing a
growth of about 35%. The operations have resulted in a net profit of Rs.
141.210 million during the year as against Rs. 0.780 million in the previous
year.
QUALITY:
The quality policy of Kirloskar Electric Company is to design, manufacture and
market, at competitive prices, products of such quality which result in
customer satisfaction, quality reputation and market leadership. The Company
strives to continuously innovate and improve its products and to ensure that
they develop products of highest quality that required by the market. They have
stringent systems in place to ensure that quality is maintained in all areas
and at all levels of operations. The Company has extended its efforts in
quality improvement to its authorised service centres as well by inviting them
to the Company's manufacturing facilities and sharing first hand knowledge
regarding manufacturing processes.
PERFORMANCE OF BUSINESS DIVISIONS:
TRANSFORMERS:
During the year the sales of transformers amounted to Rs.1031.4 million as
against Rs. 558.000 million, registering an increase of over 85%.
ELECTRONICS AND
SWITCHGEAR:
During the year the sales of electronics and switchgear amounted to Rs. 531.700
million as against Rs. 396.300 million, registering an increase of over
34%.
PROJECTS & SYSTEMS:
During the year the sales of Projects and Systems Group amounted to Rs. 138.000
million as against Rs. 68.510 million, registering an increase of over
101%.
MANAGEMENT DISCUSSION AND ANALYSIS
REPORT
INDUSTRY:
The Company is engaged in Electrical Industry which has various groups such as
Rotating Machines Group, Static Equipments Group, Switchgears Group,
Transformers Group, Capacitors Group, Transmission Lines Group, etc., Each
product group is having its different products within its broad range. The
industry is further divided into Organised Sector and Unorganised Sector. The
Company manufactures and deals in major products of the industry and the
business of the Company can be divided into three major segments i.e. Power
Generation and distribution, Trading of Rotating Machines and others.
OPPORTUNITIES:
The Indian Economy has been growing at an average rate of 8% for the last three
financial years and it calls for similar growth in Infrastructure and Power
Sector. Generally the growth rate of demand for power is higher than GDP growth
in developing countries and India is not an exception. The Government of India
have set up an ambitious mission of 'Power for all by 2012'. The Company
manufactures and deals in major products of Electrical Industry. Capacity
expansions in the user industries/newer investments in the user industries and
higher use of electrical power augur well for the industry. There is sustained
demand for the Company's products. The stress of the Company on quality
maintenance at any cost and the Kirloskar Electric brand equity stand us in
good stead. They are increasing capacity at the Transformer Unit, Mysore. The
production at Kaytee Switchgear's unit at Govenahalli has now stabilised and is
increasing. The quality, reliability of the products, and good after sale
service and countrywide network of sales and service and with the products
having approval of all major consultants will help us, as in the past, in
continue getting a good share of the industry.
Operations
During the period under report, company achieved a turnover of Rs. 0.560 millions (Previous Year Rs. 3.460 millions). The operations have resulted in a net loss of Rs. 77.420 millions (Previous Year Rs. 1065.800 millions). The figures for the two periods are not strictly comparable on account of demerger of the Company as per the Scheme of Arrangement consequent to which the Rotating Machine Group business has been transferred to Kaytee Switchgear Private Limited, now a subsidiary of the Company.
Facilities
|
|
31.03.2007 (Rs in millions) |
|
SECURED LOANS |
|
|
A Loans and Advances from banks: i) From Bank of Commerce (M) Bhd, Selangor, Malaysia - Secured by a floating charge in respect of
property situated, kept , placed or stored at any place in Malaysia, both present and future, including all stocks
in trade, goodwill and book debts to an extent of RM 550,000. |
0.029 RM 2 |
|
ii) a) Working capital Term Loan & funded interest term loans from
consortium banks are secured by first pari passu charge on certain fixed assets
along with the holders of zero coupon debentures and second pari passu charge
on current assets and the said credit facilities have been guaranteed by the
Chairman & Managing Director. b) Other working capital facilities - First pari passu charge on all
current assets and second pari passu charge on certain fixed assets along
with the holders of zero coupon debentures and the said credit facilities
have been guaranteed by the Chairman & Managing Director of the Company. iii) Term loan from a Company - First pari passu charge on residential
property at Nandidurg Road, Bangalore pending to be registered with the
Registrar of Companies. |
|
|
B) Loans and Advances from Financial Institutions: |
49.400 |
|
Zero Coupon Debentures (IDBI) - First pari passu charge on fixed assets pari passu along with banks referred to in para A (ii) above. |
|
|
BALANCES WITH FOREIGN BANKS |
9.412 |
|
i) With Bank of Commerce (M) Bhd., Kuala Lumpur : On Short term deposits |
RM 840 |
|
Maximum Balance at any time during the year |
10.903 RM 946 |
|
v) With HSBC , Dubai On Current Accounts |
0.109 AED 9 |
|
Maximum balance at any time during the year |
0.415 AED 34 |
|
v) With HSBC Dubai On Current Account |
11.598 $ 271 |
|
Maximum balance at any time during the year |
11.598 $ 271 |
|
Contingent Liabilities |
31.03.2007 |
31.03.2006 |
|
|
i) Guarantees / Counter guarantees given on Import and Sale contracts
etc. |
74.037 |
45.044 |
|
|
ii) Bills discounted with bank |
-- |
33.744 |
|
|
iii) Central excise and customs authorities have issued notices and
raised certain demands, which are
pending in appeal before various authorities, not acknowledged as debt by
the Company |
14.911 |
5.188 |
|
|
iv) Sales tax demanded under appeal in branches of the Company |
8.309 |
8.173 |
|
|
v) Claims against the Company not acknowledged as debt. The Company has made counterclaim against
one of the parties amounting to Rs.12.944 million (Previous year Rs. 12.944 million) |
216.339 |
217.559 |
|
|
vi) The Company has furnished guarantees for the credit facilities of
Rs. 128.50 million (Previous year: Rs.128.50 million) interest and other costs to
Kirloskar Batteries Private Limited (KBPL) and redemption of
Preference shares issued by Kirloskar Investment and Finance Ltd. (KIFL) Rs. 20
million (Previous year Rs. 20 million) and has obtained counter guarantees from the said Companies. The preference shareholder of KIFL has
claimed the amount from the Company. The Company has written to the said party denying is liability. The Company does not acknowledge this
liability. |
|
|
|
|
vii) Sales tax liability in respect of pending assessments |
NA |
NA |
|
|
viii) Interest and penalty if any, on account of delays/defaults in
payment of statutory/ suppliers dues not ascertainable. The Company has made
waiver petition where ever such
interest / penalty has been levied. |
NA |
NA |
|
|
ix) Sales tax on equipment procured on hire/ lease and on computer software charges is contested by the suppliers - amount not
ascertainable and will be charged to revenue in the year of final claim. |
NA |
NA |
|
|
x) Income tax demand under appeal |
132.911 |
NA |
|
|
xi) Arrears of dividend on cumulative preference shares (including tax thereon). In terms of the scheme of arrangement approved by the honorable High Court of Karnataka, dividend on the said preference shares with effect from October 1st, 2001 are payable cumulatively out of the profits of the company and the said
dividend for the period from October 1", 2001 to September 30lh, 2003 are
to be funded and converted to Zero Coupon Debentures (ZCDs). The Board of Directors vide their meeting held on September 26th, 2003 allotted ZCD's to an extent of
Rs. 2.345 crores representing dividends on the said preference shares from October I'1,
2001 to September 30th, 2003. However, on subsequent reexamination of the
matter, the Board of Directors held
that the said allotment was contrary to the scheme since in terms of the same, dividends with effect from October 1st, 2001 were payable only out of profits and in as much
as there were no profits, the
allotment would be violative of section 205 of the Companies Act, 1956. Accordingly the Board of Directors vide their meeting held on January
1 7th, 2004 proceeded to annual the said allotment. The preference shareholder has requested the Company to evolve an alternate mechanism
to compensate them. Pending finalization of the matter, no provision has been made in the books of account for
the same. In respect of items above, future cash outflows in respect of
contingent liabilities is determinable only on receipt of judgments pending at various
forums/ settlement of matter. |
61.832 |
50.684 |
|
Fixed Assets
v
Goodwill
v
Land
v
Buildings
v
Plant and Machinery
v
Furniture and Equipment
v
Vehicles
v
Aircraft
Trade Terms
v Akash Industries
v Ashok Engineering Works
v Ashwini Enterprises
v Sujatha Packers
v Aqura Pumps
v Mysore Engineering Enterprises
v Sosale Engineering Industries
v Bangalore Metallurgicals
v B P Engineering
v Vijayashree Enterprises
v Shri Maruti Engineering
v Essve Engineering
v Fab Machines Private Limited
As Per Website
The only constant they know that this world is changing. Change has come to Indian Industry like a sweeping tornado transforming the industrial environment and giving indigenous industry some very tough global standards to measure up to. In this testing situation only the fittest have the wherewithal to survive. And only the best will thrive.
That Kirloskar Electric has not only survived but has grown in confidence, capabilities, range and were scope is a testimony to the inherent strength of its foundation as a company that once set out to revolutionized India's agricultural sector with value engineering.
The difference is in the collective outlook of people trained to look upon every challenge as a platform from which to take giant leaps in quality and performance. And in so doing, to build on core capabilities of power engineering and upgrade them to world standards.
It all began when the visionary founder Laxman Rao Kirloskar created the first Iron plough for the Indian farmer.His involvement with agriculture led him to make the first pump then the prime movers for the pumps. Since then KEC corporate goal has been to look into the future and engineer products that time would eventually demand.
In order to do this, Ravi L Kirloskar, second – generation entrepreneur, son of the visionary, built a bank of prime technological skills and capabilities. And a state of art facility that has since then continuously reinvented itself to meet the changing demands of a changing market – just that one step ahead of time.
Today as a lean, innovative and aggressive power in value engineering, Kirloskar Electric is well into its tryst with world market with an offering that has strong roots in a traditional value base and comes with the inherent brand qualities of trustworthiness and complete customer satisfaction.
Moving smoothly from agricultural sector to industry, to transport, to defense, to power generation, Kirloskar Electric products have had more than a significant contribution to make to India 's rapidly evolving
economy. With long years of innovative application behind it, Kirloskar Electric finds itself completely capable of delivering a range of custom engineered products that meet and exceed global standards at very competitive prices.
The ready acceptance of the products in USA, Europe, Canada, Hong Kong, Australia, China, Singapore, South Africa, Malaysia, Pakistan, Bangladesh, along with the hard to earn certification by world's leading companies, are the direct result of an on going process. Of streamlining, redefining and recreating of processes, design and test parameters to Six Sigma and other stringent quality measures. Along with innovation as a way of life and willingness to take up any challenging customization project and making it a success. So much so that they are in the process of changing out market definition from 90:100 to 40:60 domestic to export ratio. Contract manufacturing, turnkey projects, customized products and testing facilities form the current export profile.
Today as a lean, innovative and aggressive power in value engineering, Kirloskar Electric is well into its tryst with world market with an offering that has strong roots in a traditional value base and comes with the inherent brand qualities of trustworthiness and complete customer satisfaction.
As a third generation custodian of Kirloskar brand values. I know what is to take a personal pride and satisfaction in doing the best one can collectively. And to never say no to a good full blooded challenge thrown the way.
The attitude has led to an enviable and growing list of customers that reads like Fortune 500 of the world.
The power of now is the energy of opportunities that comes to us disguised as challenges. The power of now at Kirloskar Electric is the dynamics of making them work as such at growing us as in meeting the client's tough specifications of cost and quality.
At Kirloskar Electric they bank on the power of now, much as they bank on the capacity to stretch and grow with customization calls that a few others will attempt.
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. 42.81 |
|
UK Pound |
1 |
Rs. 83.75 |
|
Euro |
1 |
Rs. 66.10 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
9 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--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 |
|
68 |
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 |
|