MIRA
INFORM REPORT
|
Report Date : |
15.03.2008 |
IDENTIFICATION
DETAILS
|
Name : |
K S OILS LIMITED |
|
|
|
|
Registered Office : |
Jiwaji
Gani Morena – 476001, Madhya Pradesh |
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Country : |
India |
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|
Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
04.02.1985 |
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Com. Reg. No.: |
10-3171 |
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CIN No.: [Company
Identification No.] |
L15141MP1985PLC003171 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
BPLK00269D |
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Legal Form : |
A
public limited liability company. The Company’s shares are listed on the Stock
Exchange. |
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|
Line of Business : |
The
company is engaged in manufacturing of Mustard Seed Oil Cake and oil Meal,
Soyabean Oil Cake Solvent Extracted Variety, Solvent Extracted Oil and
Hydrogenated Vegetable Oil |
RATING &
COMMENTS
|
MIRA’s Rating : |
A |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
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 |
|
Maximum Credit Limit : |
USD 7611200 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject
is a well established company having satisfactory track. Trade relations are
fair. General financial position is satisfactory. Payments are reported as
correct and as per commitments. The
company can be considered normal for business dealings at usual trade terms
and conditions. |
LOCATIONS
|
Registered Office : |
Jiwaji
Gani Morena – 476001, Madhya Pradesh, India |
|
Tel. No.: |
91-7532-405051 to 057 & 233951 to
959 / 300000 |
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Fax No.: |
91-7532-405060 & 233960 |
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E-Mail : |
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Website : |
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Factory
: |
Industrial
Area, A.B. Road, Morena - 476 001 Madhya Pradesh, India |
|
Tel.
No.: |
91-7532-232881 to 884 |
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Fax
No.: |
91-7532-232885 |
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E-Mail
: |
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Branches
: |
Delhi Address: 4154 (SF) Naya Bazar, Delhi -
110006 India. Phone: 91-11-23955556 & 23908133 Fax: 91-11-23908447 Email: delhi@ksoils.com Contact Person: Mr. Yogendra Sarup Cell: 91-9810009411 Mumbai Address: Room # 12 (FF) Jayant Oil Mill
Warehouse Compound, Phone: 91-22-27849782
to 783 Fax: 91-22-27849784 Email : mumbai@ksoils.com Contact Person: Mr.
Nalinesh Jha Cell: 91-9324210577
Guwahati Address: 7, R
K Mour Market, Fancy Bazar, T R Phukan Road Guwahati - 781001 (Assam) India. Phone: 91-361-2520364 Fax: 91-361-2603191 Contact Person: Mr.
Chandra Kamal Bhuiya Cell: 91-9864025789 Gwalior Address: Daal Bazar, Lashkar, Gwalior -
474001 (MP) India Phone: 91-751-2320658
& 2320494 Fax: 91-751-2329262 Contact Person: Mr.
Devendra Sharma Cell: 91-9827050669 Gandhidham Address: Gopal
Bhawan, Plot # 9, Ward # 12-B, Collector Road Phone: 91-2836-234429
& 231720 Fax: 91-2836-231720 Contact Person: Mr. Ashok Kawde Cell: 91-9825226330 |
DIRECTORS
|
Name
: |
Mr. Ramesh Chand Carg |
|
Designation
: |
Chairman |
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|
Name
: |
Mr.
Govind Prasad Carg |
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Designation
: |
Managing
Director |
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Name
: |
Mr.
Sourabh Carg |
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Designation
: |
Whole
Time Director |
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Name
: |
Mr.
Pramod Kumar Mandlol |
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Designation
: |
Director
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Name
: |
Mr.
B. N. Singh |
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Designation
: |
Director
|
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Date of Birth/Age : |
24.11.1935 |
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Qualification : |
MA
(Political Science) |
|
Experience : |
He has more than
35 years of experience in the area of Industry Development. He has worked as
industrial advisor to M. P. State Industrial Development Corporation and as
consultant with Hindustan Motors, Pithampur and Oriental Paper Mills, Amlai
(Shahdol). |
|
Chairman/Member of the Committee of the Board of
Directors of the Company: |
Audit Committee
- Member Remuneration
Committee - Chairman |
|
|
|
|
Name
: |
Mr.
R. S. Sisodia |
|
Designation
: |
Director
|
|
Date of Birth/Age : |
06.04.1946 |
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Qualification : |
PH. D
LL B , MA |
|
Experience : |
He has varied
and extensive experience in the field of Corporate Legal matters and
marketing of Agro Products and commodities. He had worked on various senior
positions in the department of Madhya Pradesh State Road Transport
Corporation (MPSRTC) and as Additional Director in Agricultural Marketing
Board, Bhopal. |
|
Chairman/Member of the Committee of the Board of
Directors of the Company: |
Audit Committee
- Member Remuneration
Committee - Member |
|
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|
Name
: |
Mr.
Y. Sarup |
|
Designation
: |
Chief
Executive (Overseas) |
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Name
: |
Mr.
Vlneet Garg |
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Designation
: |
Chief
Executive (Operation) |
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Name
: |
Mr.
Vivek Carg |
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Designation
: |
Chief
Executive (Finance) |
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Name
: |
Mr.
Chandra Kamal Bhuyan |
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Designation
: |
Head
- Marketing (North-East) |
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Name
: |
Mr.
Ashok Kawade |
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Designation
: |
Head
- Logistics |
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Name
: |
Mr.
Nallnesh Jha |
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Designation
: |
Head
- Overseas |
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Name
: |
Mr.
Jayant Mltra |
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Designation
: |
Head
- Human Resources & Admin. |
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Name
: |
Mr.
Anil K. Kabra |
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Designation
: |
Head'
Accounts And Audit |
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Name
: |
Mr. V. K. Mathur |
|
Designation
: |
Head
- Prod. Refined & Vanaspati |
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|
Name
: |
Mr.
V. K. Bamal |
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Designation
: |
Head
- Oil & Solvent |
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|
Name
: |
Mr.
Ramniwas Gupta |
|
Designation
: |
Head
- Accounts |
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|
Name
: |
Mr. P
R Srinivasan |
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Designation
: |
Director
|
|
Date of Birth/Age : |
01.06.1965 |
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Qualification : |
BE,
MA |
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Experience : |
He has 14 years
of experience as a Venture Capital and Private Equity Investor and 4 years as
a production engineer. Currently employed with Citigroup since 2002.
Previously employed with HSBC (7 years), ICICI Ventures (3 years) and
Hindustan Aeronautics Limited (4 years). |
|
Directorship held in other company: |
1. JBF Industries
Limited 2. You Telecom
India Private Limited. |
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|
Name
: |
Mr. R
Ganesh |
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Designation
: |
Director
|
|
Date of Birth/Age : |
09.11.1953 |
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Qualification : |
FCS,
CAIIB, LLB, B com |
|
Experience : |
He has 34 years
of experience in handling a variety of senior level assignments in the areas
of finance, banking, legal, project management and production. |
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Directorship held in other company: |
Renoir
Consulting (India) Private Limited. |
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|
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|
Name
: |
Mr.
Sanay Agarwal |
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Designation
: |
Director
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MANAGEMENT
TEAM:- |
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|
Name
: |
Mr. Himanshu |
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Designation
: |
Head – Business Strategy |
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Name
: |
Mr. Y Sarup |
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Designation
: |
Chief Executive (Overseas) |
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Name
: |
Mr. V K Mathur |
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Designation
: |
Vice President
(Production) |
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Name
: |
Mr. C B S Rawat |
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Designation
: |
Vice President (Marketing) |
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Name
: |
Mr. C K Bhuniyan |
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Designation
: |
Vice President (Marketing , North East) |
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Name
: |
Mr. Praveen Khandelwal |
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Designation
: |
Vice President (Accounts) |
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Name
: |
Mr. Nalinesh Jha |
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Designation
: |
Vice President (Overseas) |
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Name
: |
Mr. Ramesh Chandra |
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Designation
: |
Head Production (Oil) |
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Name
: |
Mr. B K Bamal |
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Designation
: |
Head Production
(Solvent) |
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Name
: |
Mr. Rajesh Srivastav |
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Designation
: |
Head Production (Vanaspati) |
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Name
: |
Mr. Virendra Singh |
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Designation
: |
Head Production |
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Name
: |
Mr. Saji Kumar |
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Designation
: |
Head Production (Packaging) |
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Name
: |
Me. Ashok Kawde |
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Designation
: |
Head Purchase |
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Name
: |
Mr. Mahesh Agrawal |
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Designation
: |
Head – Quality Control |
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Name
: |
Mr. Ramniwas Guptra |
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Designation
: |
Head – Audit Ands Accounts |
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Name
: |
Mr. Manish Goyal |
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Designation
: |
Head Finance |
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Name
: |
Mr. P V Simon |
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Designation
: |
Senior Manager (Purchase) |
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Name
: |
Mr. Ritesh Mundra |
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Designation
: |
Senior Manager (Operations) |
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Name
: |
Mr. Saji Mon P M |
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Designation
: |
Senior Manager (Systems) |
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Name
: |
Mr. Amit Agarwal |
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Designation
: |
Senior Manager (Overseas) |
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Name
: |
Mr. Navin Sharma |
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Designation
: |
Senior Manager (Accounts) |
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|
Name
: |
Mr. Prakash Agrwal |
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Designation
: |
Senior Manager (Audit) |
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|
Name
: |
Mr. Anurudh Singh |
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Designation
: |
Senior Manager (Legal) |
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Name
: |
Mr. Sanjay Gupta |
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Designation
: |
Senior Manager (It) |
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|
Name
: |
Mr. Vinay Agrawal |
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Designation
: |
Senior Manager (Taxation) |
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|
Name
: |
Mr. Bhaskar |
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Designation
: |
Senior Manager (Project) |
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Name
: |
Mrs. Meenal Luther |
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Designation
: |
Senior Manager (Brand) |
KEY EXECUTIVES
|
Name : |
Mr.
Vikas Tulsiani |
|
Designation : |
Company
Secretary |
|
|
|
|
Name : |
Mr. Santosh Kumar soni |
|
Designation : |
Assistant Company Secretary |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
|
Names of Shareholders (as on 31.03.2007):- |
No. of Shares |
Percentage of
Holding |
|
Promoter
Holdings |
|
|
|
Promoters |
|
|
|
Indian Promoters |
6483775 |
29.35% |
|
Sub total |
6483775 |
29.35% |
|
Non Promoters
Holdings |
|
|
|
Institutional
Investors |
|
|
|
Banks, Financial Institutions, Insurance companies (Central / State
Government institutions/ Non
Government Institutions) |
1200 |
0.00% |
|
Foreign Institutional Investors |
2760887 |
12.50% |
|
|
|
|
|
Category |
|
|
|
Others |
|
|
|
Private Corporate bodies |
1708955 |
7.74% |
|
Indian Public |
7827932 |
35.43% |
|
Any Others |
|
|
|
· NRIs |
35541 |
0.16% |
|
· Foreign Corporate Bodies |
3273366 |
14.82% |
|
Sub
Total |
12845794 |
58.15% |
|
Grand
Total |
22091656 |
100.00% |
BUSINESS DETAILS
|
Line of Business : |
The
company is engaged in manufacturing of Mustard Seed Oil Cake and oil Meal,
Soyabean Oil Cake Solvent Extracted Variety, Solvent Extracted Oil and
Hydrogenated Vegetable Oil |
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Products : |
|
PRODUCTION STATUS:-
A) Capacity (As certified by
management and accepted by auditors):-
|
Particulars |
|
|
Unit |
Installed Capacity |
|
Mustard Oil (Owned and Leased) |
|
|
MT |
129375 |
|
Refined Oil |
|
|
MT |
120000 |
|
DOC |
|
|
MT |
133200 |
|
Solvent Extracted Oil |
|
|
MT |
43200 |
|
Vanaspati Ghee |
|
|
MT |
45000 |
|
Wind Mill |
|
|
MW |
7.00 |
B) Trading and production Data:-
|
Description |
|
Unit |
Quantity |
Actual Production |
|
Opening Stock |
|
|
|
(Rs. in
millions) |
|
Oil |
|
MT |
26274 |
1008.100 |
|
DOC |
|
MT |
4174 |
18.600 |
|
Vanaspati Ghee |
|
MT |
635 |
23.100 |
|
By product / Packing Material / Trading Goods |
|
|
---- |
20.300 |
|
Empty Tin |
|
Nos. |
53249 |
2.500 |
|
Production |
|
|
|
|
|
Oil |
|
MT |
124173 |
--- |
|
DOC |
|
MT |
130261 |
---- |
|
Vanaspati Ghee |
|
MT |
9292 |
--- |
|
Power |
|
KWH |
4632383 |
--- |
|
Empty Tin |
|
Nos |
2885021 |
--- |
|
Purchases |
|
|
|
|
|
Oil |
|
MT |
68042 |
2859.300 |
|
DOC |
|
MT |
19716 |
84.500 |
|
Vanaspati Ghee |
|
MT |
---- |
---- |
GENERAL
INFORMATION
|
Suppliers: |
· C. P. Industries, Gwalior · Dilip Oils, Morena · Tarun Oils Private Limited, Morena · Amar Deep Mineral Industries, Gujarat · Brijwasi Packaging, Bhind · Gwalior Plastic Industries, Gwalior · Gyan Plastic Manufactures · Industrial Packaging, Gwalior · Parth Packaging Products, Delhi · Radhi Sidhi Polymers, Bharatpur |
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No. of Employees : |
About 1500 |
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|
Bankers : |
v
Central
Bank of India v
Andhra
Bank |
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Facilities : |
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Banking Relations : |
Satisfactory |
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|
Auditors : |
Rathi
and Company Chartered
Accountants INTERNAL AUDITORS Sanjay Kailcharan Agarwal & Associates Chartered
Accountants |
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|
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Associates/Subsidiaries : |
· K S Foods Products · K S Enterprises · Sanjay Kalicharan Agarwal and Associates · Ramesh Chand Sourabh Kumar (HUF) |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
30000000 |
Equity Shares |
Rs. 10/- each |
Rs.300.000 millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
22091656 |
Equity Shares |
Rs. 10/- each |
Rs.220.900
millions |
Of the above
following were allotted during the year :
(a) Re-issue of
107100 Forfeited Equity Shares of Rs. 10/- each at a premium of Rs. 170/- each
during the year.
(b) Preferential
allotment of 900000 Equity Shares of Rs. 10/- each at a premium of Rs. 215/-
each during the year
(c) 3291656 Equity
Shares of Rs. 10/- each at a premium of Rs. 170/- each during the year.
(d) As fully paid
bonus shares: 9400000 Equity shares of Rs.10/- each by capitalization of
Security Premium Account and General reserve.
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
220.900 |
84.500 |
49.500 |
|
|
2] Equity Share Entitlement Warrants |
237.800 |
0.000 |
21.900 |
|
|
3] Reserves & Surplus |
1434.200 |
372.600 |
179.900 |
|
|
4] Deferred Government Grant |
9.900 |
10.500 |
11.100 |
|
|
NETWORTH |
1902.800 |
467.600 |
262.400 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
851.800 |
787.700 |
741.400 |
|
|
2] Unsecured Loans |
150.100 |
85.900 |
0.000 |
|
|
TOTAL BORROWING |
1001.900 |
873.600 |
741.400 |
|
|
DEFERRED TAX LIABILITIES |
155.700 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
3060.400 |
1341.200 |
1003.800 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
1175.000 |
438.300 |
316.000 |
|
|
Capital work-in-progress |
135.200 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
INVESTMENT |
0.000 |
0.000 |
0.000 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS &
ADVANCES |
|
|
|
|
|
|
Inventories |
2476.900
|
1552.200 |
0.000
|
|
|
Sundry Debtors |
139.100
|
154.100 |
172.800
|
|
|
Cash & Bank Balances |
130.600
|
60.800 |
71.500
|
|
|
Other Current Assets |
0.200
|
3.000 |
1146.700
|
|
|
Loans & Advances |
487.400
|
53.700 |
34.900
|
|
Total Current Assets |
3234.200
|
1823.800 |
1425.900 |
|
|
Less : CURRENT LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
1272.400
|
875.300 |
721.100
|
|
|
Provisions |
235.300
|
45.600 |
17.000
|
|
Total Current Liabilities |
1507.700
|
920.900 |
738.100 |
|
|
Net Current
Assets |
1726.500
|
902.900 |
687.800 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
23.700 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
3060.400 |
1341.200 |
1003.800 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
Sales Turnover |
10221.400 |
5626.300 |
4530.100 |
|
|
Other Income |
10.700 |
4.400 |
0.000 |
|
|
Total Income |
10232.100 |
5630.700 |
4530.100 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
738.800 |
176.000 |
41.200 |
|
|
Provision for Taxation |
165.600 |
24.300 |
7.600 |
|
|
Profit/(Loss) After Tax |
573.200 |
151.700 |
33.600 |
|
|
|
|
|
|
|
|
Export Value |
169.399 |
64.575 |
63.053 |
|
|
|
|
|
|
|
|
Import
Value |
112.383 |
214.981 |
1179.509 |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Manufacturing Expenses |
330.900 |
251.200 |
|
|
|
Administrative Expenses |
154.200 |
130.700 |
4488.900 |
|
|
Raw Material Consumed |
8937.000 |
5516.600 |
|
|
|
Selling Expenses |
237.500 |
138.100 |
|
|
|
Interest |
153.500 |
71.500 |
|
|
|
Depreciation & Amortization |
45.200 |
28.500 |
|
|
Total Expenditure |
9858.300 |
6136.600 |
4488.900 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2007 |
30.09.2007 |
31.12.2007 |
|
Type
|
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
|
Sales Turnover |
3663.300 |
4432.900 |
5636.700 |
|
Other Income |
12.700 |
12.400 |
17.200 |
|
Total Income |
3676.000 |
4445.300 |
5653.900 |
|
Total Expenditure |
3206.300 |
3914.500 |
5044.200 |
|
Operating Profit |
469.700 |
530.800 |
609.700 |
|
Interest |
88.400 |
95.200 |
84.800 |
|
Gross Profit |
381.300 |
435.600 |
524.900 |
|
Depreciation |
25.500 |
30.900 |
30.900 |
|
Tax |
119.700 |
123.400 |
154.200 |
|
Reported PAT |
236.100 |
265.800 |
324.300 |
KEY RATIOS
|
Year |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt-Equity Ratio |
0.88 |
2.28 |
3.32 |
|
Long Term Debt-Equity Ratio |
0.19 |
0.29 |
0.46 |
|
Current Ratio |
1.18 |
1.05 |
1.01 |
|
TURNOVER RATIOS |
|||
|
Fixed Assets |
11.02 |
11.64 |
10.69 |
|
Inventory |
5.40 |
4.51 |
4.37 |
|
Debtors |
74.21 |
37.21 |
20.90 |
|
Interest Cover Ratio |
5.41 |
3.02 |
1.43 |
|
Operating Profit Margin(%) |
8.75 |
4.80 |
3.57 |
|
Profit Before Interest And Tax Margin(%) |
8.33 |
4.33 |
3.02 |
|
Cash Profit Margin(%) |
5.68 |
2.96 |
1.29 |
|
Adjusted Net Profit Margin(%) |
5.27 |
2.49 |
0.74 |
|
Return On Capital Employed(%) |
45.50 |
22.67 |
14.33 |
|
Return On Net Worth(%) |
53.76 |
42.85 |
15.14 |
LOCAL AGENCY
FURTHER INFORMATION
With an enhanced market share,
especially in the branded and retail segment and strengthened internal
processes, the Company proved its commitment to quality with the ISO 9001:2000
Certification. Moreover during the year the company has gained the confidence
of the investors' by way of infusion of foreign equity participation.
Business Results:
The business performance of the
Company during the year was commendable.
The company recorded a top line growth of 79% with the turnover at
Rs.10870.000 millions as against Rs. 6080.000 millions in the previous year.
The profit after tax also recorded a near four fold jump with a 278% increase
to Rs. 573.200 millions as against Rs.151.700 millions in the previous year.
EPS also recorded 233% growth and reached to Rs. 30 per share from Rs. 9 per
shares in the previous year. The management made all efforts to keep its
promise of increasing revenues and market share. The year witnessed wonderful
results and the coming years hold promises of the company becoming a leading
player in Indian edible oil sector.
Division wise operational performance
for the year ended 31st March, 2007 was as under:
Oil Division:
During the year Mustard seeds
processed stood at 183434 MT against that of 82874 MT in previous year thus
recording a significant jump of 121% as compared to previous year. The company
continued to be a major player in mustard oil segment.
Refinery Division:
Production of Refined oil stood at
50270 MT against that of 57906 MT in previous year, recording a marginal
decrease as compared to the previous year.
Vanaspati Division:
Production of Vanaspati was at
9292 MT against that of 10046 MT in the previous year, recording a marginal
decrease as compared to previous year.
Solvent Division:
During the year DOC (De Oiled
Cake) production was at 130261 MT as against 110697 MT during the previous
year, thus recording an increase of 17.67 percent over the previous year.
Power Division:
During the year power generated
through wind mills was 4632,83 units against 138 units in the last year. The
marginal production in last year was due to the wind mills getting operational
only on 31st March, 2006 and 2006-07 was full year for the wind mill
operations.
Dividend:
In view of the improved performance of the
Company, the Directors are pleased to recommend a higher dividend of 15%,
aggregating to Rs.38.785 millions (including tax on dividend of Rs. 5.632
millions) as compared to 12% aggregating to Rs. 11.484 millions in the previous
year (which included tax on dividend of Rs. 1.413 millions).
Transfer to Reserve:
The Company proposes to transfer
8.72% of the profit earned during the year i.e. Rs. 50.000 millions to the
general reserve. The Company proposes to retain an amount of Rs. 484.500
millions out of current year's profit in the profit and loss account.
Achievements:
During the year, the Company has been awarded the prestigious ISO 9001:2000
certification for Quality Management Systems for Manufacturing and Supply of
Edible Oils. The recognition will go a long way to establish the company as a
quality-oriented organization.
The company will maintain its Customer centric approach with emphasis on
continuous improvement in the quality and value of their products.
During the year 2006-07, the company has received two prestigious awards - MCX
Globoil Emerging Company of the year 2006 from Globoil India and SEA AWARD
2005-06 for Highest processor of Rapeseed Oilcake awarded by the Solvent
Extractors Association of India, Mumbai.
New
Projects/Expansion/Acquisition:
During the year in terms of
organic growth the capacity of Oil Mill was increased by 225 MT/day, Refinery by
150 MT/day. In terms of Inorganic growth the Company has acquired an edible oil
plant at Jodhpur (Rajasthan) in February 07 and entered into a strategic tie-up
with another edible oil plant in Alwar (Rajasthan) in April 07.
The plant at Jodhpur has crushing capacity of 225 MT/ day and refining capacity
of 100 MT/day. Alwar plant has crushing capacity of 250 MT/day, solvent
extraction plant of 300 MT/day and refinery of 100 MT/day. After the successful
operation of 2.50 MW wind mills at Dewas (M.P.) the company has further erected
and commissioned three Suzlon make wind mills in the state of Gujarat having a
total production capacity of 4.5 MW.
MANAGEMENT DISCUSSION AND ANALYSIS
The company has been able to
create presence in two very important markets - East and North India, while
maintaining its market dominance in North East India. It is the largest
processor of Mustard/ Rape seed in India. The company has set up operations in
Rajasthan along with its manufacturing facility in Morena, Madhya Pradesh, one
of the most fertile mustard seed growing area as also a key commodity nerve
center.
The company today is one of the leading suppliers of edible oils to the Indian
Defense forces and this tradition has been long maintained for the past few
years.
The company has made a concerted effort to move itself from a mustard oil
producing company to a leading market focused FMCG led brand company. The
opportunity in the Indian markets is huge - statistics show that 6 northern
states of India consume 90% of the mustard oil produced in the country.
This throws up an opportunity of
over 50 crore customers.
Industry Overview:
India today is the only country
which has retail led growth left in the world, maybe, along with China. This
retail and mall culture in the country poses a huge opportunity to the whole
edible oil sector. A study by NCAER shows a major shift in the consuming class;
while in 2003, India had 181 million households of which only 3 million were in
the Rich bracket and 46 million as Aspirers, by 2013 India will have 231
million households out of which 11 million would be Rich and 124 million
Aspirers! Thus the shape of India is going to change in the next 5 years - from
being just a pyramid to a sparkling Diamond.
Certain recent statistics are mind boggling and at the same time, is the Great
India Opportunity that they strongly believe in - India today has a population
of 1027 million which resides in 5545 towns and 638000 villages having 2.5
million and 5.0 million retail outlets respectively.
This retail opportunity is waiting to be tapped; the surging middle class,
growth of the IT/ ITES sector has given rise to a totally new breed of
`spending' class for whom upgrading the lifestyle is most important. Thus, from
a nation of savers, India for the next decade or so will be the nation of
spenders. There has been shift towards spending habits and attitude - from a
customer who was value conscious, a new consumer is being born who wants to
rise in the value chain and is ready to pay a premium for it.
Products and brandsaddressing this
new consumer segment will surge ahead in market share, mind share and
profitability. Today Indian consumer confidence is highest in the world which
shows the spending opportunity.
Today India accounts for 7% of the global oilseeds and oil meal production and
10% of the world's consumption of edible oil. With the edible oil market size
being at Rs 675 billion and the branded segment having 15% market share, the
opportunity is huge. Also, with modern retail formats being just 3%, the
penetration opportunity is mind boggling.
Lastly, with an improvement in the lifestyle of the Indian consumer, healthy
living will be a priority which will create an immense opportunity for edible
oil sector. A latest report from FICCI suggest that the branded edible oils
market is expected to grow at 20% per annum, which will not only spur the
demand for edible oils but will drive demand towards branded and organized
edible oil players.
Business Direction:
The company has had a fantastic
year in 2006-07 and they have taken certain strategic steps to ensure that the
company is able to become a national level player in the next few years. This
year the company clocked a turnover over 79% over the past one year and
profitability increased by 278% in the current year.
Two very clear cut strategies worked for the company which will be the focus in
the times to come; increased margins through retail led sales and entering into
newer markets like North and East India. The company completely re-vamped the
way it did business and some of the key measures are discussed as below:
Retail led manufacturing strategy:
The company has followed a very
successful retail led manufacturing strategy whereby special emphasis was laid
in production of retail packs, packaging and quality. This retail thrust has
helped the company increase profitability substantially and today retail sales
contribute 20% of the total sales of the company which will increase in the
coming years.
New markets Strategy - Acquisition of
Business and Customers:
During the current year, their
acquisition strategy on two fronts were very strategic - they created
manufacturing facility in North India by acquiring one facilitiy and one leased
in Rajasthan which was strategic in the procurement of Mustard seeds and to
reaching out to newer markets in North and East India. This has helped up ramp
up production and helped them acquire customers and market share in these two
new markets; also, a significant shift has been in the increased retail sales
in the new geographies.
Distribution and Marketing set up:
Another area which has been their
key focus is creating a strong retail and distribution backbone. The company
today has a strong and well spread distribution network of over 350
distributors and 35 CDP's (Central Distribution Points) which is helping the
company reach out its retail packs to a larger audience in a quick and
efficient manner. The company has a strong team of near to 100 people in the
marketing division which is ensuring world class logistics support to create a
fast and agile FMCG company.
Brand led product focus:
The current year saw them heavily
investing in both product and consumer R and D - they have put in place world
class standards in R and D for packaging, quality and products. This has helped
us to create a brand led product focus and strengthen their brands Double Sher,
Kalash, K S Refined and K S Gold in the minds of the consumer. Today they are a
quick turnaround company which is investing heavily in building brands and
customer experiences.
Opportunities and Threats:
The new age Indian consumer, the
organized retail potential which is creating the huge consumption opportunity
is by far the biggest Opportunity for companies like them. With the
aspirational and rich class in India having a better penetration, their retail
and brand led growth will help the company in both the immediate and long run.
Also, with the rural India being revisited by marketers through the modern
retail (haat) philosophy, the opportunity is huge.
India is also seeing a great increase in life style led diseases like heart
ailments and cardio vascular illness which is said to rise much higher than
other nations; this creates a potential for healthy edible oil and mustard
being one of the world's most heart friendly oil, consumers will be eager to
adapt to branded and quality led mustard oil brands.
Competition from Indian and global players remain a matter of concern and
probable threat; while the company is well prepared to tackle such issues on an
ongoing basis, K. S. Oils ability towards product differentiation, value
addition and being one of the most low cost producers will help it address any
threats from competition.
OTHER INFORMATION:
Outstanding Securities:
The members of the Company accorded their approval at the Extra Ordinary General Meeting held on 12th December, 2006 by passing a Special Resolution and on receipt of 10% of the value i.e. Rs. 30.750 millions the Board of Directors allotted 1708344 Warrants (Investor Warrants) of Rs. ISO/- each to the Citigroup Venture Capital International Growth Partnership Mauritius Limited and others, and 2300000 Warrants (Promoters Warrants) of Rs. ISO/- each allotted on receipt of 50% of the value i.e. Rs. 207.000 millions to Promoters, the aforesaid warrants carrying a right to subscribe to equal number of equity shares within a period of 18 months from the date of allotment at a price of Rs.180/- each, convertible into equity shares of Rs.10/- each at a premium of Rs.170/- per equity shares.
On conversion of these warrants the paid up capital of the Company will enhance by Rs. 40.083 millions.
The types of products in each business segment are as under:-
|
Oil Division |
Mustard Oil, Mustard Cake, Refined Oil, Tin
Container, HDPE Jars |
|
Solvent Division |
Solvent Oil, De – Oiled Cake |
|
Vanaspati Division |
Vanaspati Ghee, Tin Containers, HDPE Jars |
|
Power division |
Power Generation (Wind Mills) |
CONTINGENT LIABILITES:
|
Contingent liability in respect of : |
31.03.2007 |
31.03.2006 |
|
|
(Rs. in millions) |
|
|
Outstanding Bank guarantees |
Nil |
8.164 |
|
Letter of Credits |
Nil |
Nil |
|
Capital Commitments. |
66.063 |
0.055 |
|
Excise Duty and customs demands |
3.891 |
Nil |
FIXED ASSETS:
· Land
· Building
· Plant and Machinery
· Electric Installation
· Furniture and Fixtures
· Vehicles
· Office Equipments
· Utilities
· Windmills
PRESS RELEASE:
S Oils targets Rs
10000.000 millions revenues, to invest Rs 700.000
Mumbai, Jun 5:
Madhya Pradesh-based edible oil company, K S Oils Ltd is aiming to achieve a turnover of Rs 10000 Millions this fiscal and would invest close to Rs 700 Millions for inorganic growth, increasing the retail market share and installation of wind mills.
"Their will invest a total Rs 500 Millions in this financial
year in acquiring a plant at Jodhpur and another plant at Guna. The remaining
investments would go in marketing through modern retail formats and
installation of two wind mills," Company Chairman Ramesh Garg told PTI
here.
K S oils is largest mustard oil crushing company with a capacity
to extract oil from 1,0000 metric tonnes of mustard seed per day.
The company also supplies other edible oils and vanaspati.
KS Oils plans to increase its retail market share to 50 per cent
from current 20 per cent of its total production through small pack sizes, he
said.
"As part of their marketing strategy their plan to increase the retail
share of their production to 50 per cent from current 20 per cent by tapping
new cities," he said.
Their have earmarked an investment of Rs seven Millions for their retail
marketing initiatives, he said.
It plans to increase the exports of its soybean and rapeseed meal this
financial year.
"Their are targeting at increasing their exports to Rs 550 Millions
from current Rs 400 Millions this fiscal," he said.
K S OILS also plans to install two additional wind mill of 2.5
megawatt (1.25 mw each) at an investment of Rs 120 Millions, he added.
WEBSITE DETAILS:
Company Profile
Subject is one of the leading manufactures of mustard/ rapeseed oil in India. It has an impressive track record established over a period of 20 years since inception in 1985.
The manufacturing facilities of the Company
situated at Morena (MP) at a large industrial complex. The processing capacity
of various units of the company are viz Oil mill 1325 tpd, Refinery 300 tpd,
Solvent extraction plant 850 tpd, Vanaspati 200 tpd, Packaging container 25,000
pcs/day and HDPE containers 12,000 pcs/day.
The Garg family at Morena are the promoters of
the company, for over six generations and has all along been engaged in edible
oil business.
The Company is leading name in the edible oil
industry with an annual turn over of 6040 Millions in the year 2005-06. The
Company’s flagship brands ‘Double Sher’ and ‘Kalash’ (Mustard Oil) are leaders
in Mustard Oil market. The other popular brands are KS Refined Oil, ‘Crystal
Clear’ (Soya Vegetable Refined Oil), ''KS Gold’ (Vanaspati Ghee) and KS Gold
Plus (Vanaspati Ghee) which also enjoys significant position in the edible oil
industry.
Subject is having a huge market share in Eastern
and North-Eastern India. The Company is one of the largest and regular supplier
of edible oil to Defence organisation and exports soyabean/ rapeseed meal to
foreign buyers.
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.40.45 |
|
UK Pound |
1 |
Rs.81.20 |
|
Euro |
1 |
Rs.63.48 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
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 |
YES |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
66 |
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 |
|