MIRA
INFORM REPORT
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Report Date : |
14.10..2008 |
IDENTIFICATION
DETAILS
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Name : |
PARAMOUNT COMMUNICATIONS LIMITED |
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Formerly Known As : |
PARAMOUNT CABLES |
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Registered Office : |
C-125 Naraina Industrial Area, Phase-l, Naraina, New, Delhi -110 028 |
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Country : |
India |
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Financials (as on) : |
31.03.2008 |
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Date of Incorporation : |
05.09.1994 |
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Com. Reg. No.: |
55-61295 |
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CIN No.: [Company
Identification No.] |
L74899DL1994PLC061295 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
DELP04139C / DELP08582A |
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PAN No.: [Permanent
Account No.] |
AAACP0969Q |
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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 : |
Manufacturing of Insulated Wire and Cable such as
Enamelled or Anodized, Coaxial Cable and other Insulated Conductors, Insulted
Strip as is used in large capacity machines or control equipment and optical
fibre cables. |
RATING &
COMMENTS
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MIRA’s Rating : |
Aa |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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 |
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Maximum Credit Limit : |
USD 9800000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a well established and reputed company having fine track.
Fundamentals are strong and healthy. Trade relations are fair. Business is
active. Payments are reported as usually correct and as per commitments. The company can be considered good for any normal business dealings. It can be regarded as a promising business partner in a medium to long
– run. |
LOCATIONS
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Registered Office / Corporate Office : |
C-125 Naraina Industrial Area, Phase-l, Naraina, New, Delhi -110 028,
India |
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Tel. No.: |
91-11-25897421 – 30 |
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Fax No.: |
91-11-25893719 – 20 |
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E-Mail : |
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Website : |
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Head Office : |
M-4 Bahubali, 59 / 17 New Rohtak Road, New Delhi – 110
015, India |
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Tel. No.: |
91-11-5723106 / 5734981 /
5789651 / 5764094 |
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Fax No.: |
91-11-5739191/5761770 |
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Factory 1 : |
(Optical Fibre Cable Division) SA30A, RIICO Industrial
Area, Village Karoli, Post Khushkhera, Dist. Alwar – 301 707, Rajasthan,
India |
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Tel. No.: |
91-1493-50221 – 23 |
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Fax No.: |
91-1493-50125 |
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E-Mail : |
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Factory 2 : |
(Jelly Filled Telephone Cable (JFTC) Division) 37, Industrial Estate, Dharuhera, District Rewari – 122
106, Haryana, India |
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Tel. No.: |
91-1274-42690 / 42531 |
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Fax No.: |
91-1274-42552 |
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E-Mail : |
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Factory 3 : |
(Paramount Cable Corporation) SP 30A, RIICO Industrial Area, Village Karoli, Post
Khushkhera, District Alwar – 301 707, Rajasthan, India |
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Tel. No.: |
91-1493-50221 – 23 |
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Fax No.: |
91-1493-50125 |
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E-Mail : |
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Branch office : |
201, Royal Plaza, New Link Road, Andheri [West], Mumbai – 400053,
Maharashtra, India |
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Tel. No.: |
91-22-26398408 |
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Fax No.: |
91-22-26390168 |
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E-Mail : |
DIRECTORS
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Name
: |
Mr. Sanjay Aggarwal |
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Designation
: |
Chairman and CEO |
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Date
of Birth/Age : |
21.10.1962 |
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Date
of Appointment : |
01.11.1994 |
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List
of Outside Directorship : |
1. Paramount Wires and Cables Limited 2. Paramount Gulf FZE 3. .Foresight Exim Limited 4. Paramount Realty Private Limited 5. Paramount Infratech Private
Limited |
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Chairmanship/Membership
of the Committee of Board of Directors of the company : |
1. Member-Shareholders/lnvestors Grievance Committee 2. Chairman-Share Transfer Committee |
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Chairmanship/Membership
of the Committee of Board of Directors of other company : |
Member-Audit Committee, Paramount Wires and Cables Limited |
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Name
: |
Mr. Sandeep Aggarwal |
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Designation
: |
Managing Director |
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Name
: |
Mr. Satya Pal |
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Designation
: |
Director |
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Name
: |
Mr. S.P.S. Dangi |
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Designation
: |
Director |
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Name
: |
Mr. Vijay Bhushan |
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Designation
: |
Director |
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Date
of Birth/Age : |
22.12.1958 |
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Date
of Appointment : |
22.07.2000 |
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List
of Outside Directorship |
1. Bharat Bhushan Equity Traders Limited 2. Bharat Bhushan Share and Commodity Brokers Limited 3. Bharat Bhushan Insurance Brokers Private Limited 4. Bharat Nidhi Limited 5. KEI Industries Limited 6. Bharat Bhushan Technologies Private Limited |
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Chairmanship/Membership
of the Committee of Board of Directors of the company |
1. Chairman-Shareholders/lnvestors Grievance Committee 2. Member-Audit Committee 3. Member-Remuneration Committee |
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Chairmanship/Membership
of the Committee of Board of Directors of other company |
1. Member-Audit Committee, Bharat Bhushan Share and
Commodity Brokers Limited 2. Chairman-Shareholders/lnvestors Grievance Committee,
KEI Industries Limited 3. Member-Remuneration Committee, KEI Industries Limited |
KEY EXECUTIVES
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Name : |
Mr. Ratan Aggarwal |
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Designation : |
Chief Compliance Officer |
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Name : |
Mr. Ratan Aggarwal |
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Designation : |
Vice President (Finance) and Company
Secretary |
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Name : |
Mr. D. S. Muchhal |
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Designation : |
Sr. Vice – President (Dharuhera Unit) |
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Name : |
Mr. G. D. Singh |
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Designation : |
Vice President (Khushkhera
Unit) |
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Name : |
Mr. P. K. Agarwal |
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Designation : |
Vice President (Marketing) |
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Name : |
Mr. Mrinmoy Chaudhury |
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Designation : |
Vice President (Business
Development) |
BUSINESS DETAILS
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Line of Business : |
Manufacturing of Insulated Wire and Cable such as
Enamelled or Anodized, Coaxial Cable and other Insulated Conductors, Insulted
Strip as is used in large capacity machines or control equipment and optical
fibre cables. |
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Products : |
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Exports : |
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Products : |
·
Wire ·
Cables and conductors telecommunication and signaling ·
Power and control, etc. |
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Countries : |
·
CIS ·
Ghana ·
Russia ·
Sri Lanka ·
Sultanate of Oman ·
Tanzania ·
UK ·
Ukraine ·
Zambia |
PRODUCTION STATUS
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Particulars |
Unit |
Installed
Capacity |
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Power Cables* |
KMS |
26500 |
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Jelly Filled Telephone Cables |
CKM |
5299000 |
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Optical Fibre Cables |
KMS |
20000 |
GENERAL
INFORMATION
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Customers : |
· Power Grid Corporation of India Limited (PGCIL) · National Thermal Power Corporation (NTPC) · Bharat Heavy Electricals Limited (BHEL) · Areva T and D · Alstom · Indian Space Research Organisation (ISRO) · Department of Atomic Energy, Govt. of India · Indian Oil Corporation Limited (IOCL) · Reliance Petroleum Limited · Reliance Energy Limited · Essar Constructions · Essar Oil and Gas · North Delhi Power Limited · Uttar Pradesh Power Corporation Limited (UPPCL) · Brihanmumbai Electric Supply and Transport Undertaking (BEST) · Jaipur Vidyut Vitaran Nigam Limited (JVVNL) · BSES Delhi · Jindal Steel · Bhushan Power and Steel · Crompton Greaves Limited · Konkan Railways · Delhi Metro Rail Corporation Limited (DMRC) · Indian Railways · Railtel Corporation of India Limited · Indian Railway Construction Company · Oil and Natural Gas Corporation Limited (ONGC) · Gas Authority of India Limited (GAIL) · Sri Lanka Telecom · Bharat Sanchar Nigam Limited (BSNL) · Bharti Enterprises · Engineers India Limited (EIL) · Rail India Technical and Economic Services Limited · HFCL Infotel · Tata Consulting Engineers · Telecommunication Consultants India Limited (TCIL) · Hughes Tele · LLoyd's Register Industrial Services (I) Limited · Development Consultants Limited · Holtec Engineers - A leading consultant for cement projects in India · Engineering Projects India Limited · Naval Science and Technological Lab · Project Development India Limited |
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No. of Employees : |
1200 |
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Bankers : |
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State Bank of India, Industrial Finance Branch, Vijaya
Building, 17, Barakhamba Road, New Delhi – 110 001, India ·
Dena Bank, Karol Bagh Branch, New Delhi – 110 005, India ·
ICICI Bank Limited ·
Yes Bank Limited ·
Standard Chartered Bank ·
The Hongkong and Shanghai Banking Corporation Limited ·
HDFC Bank Limited |
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Facilities : |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
Jagdish Chand and Company Chartered Accountants |
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Address : |
H-20, Green Park (Main), New Delhi – 110 016, India |
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Memberships : |
Confederation of Indian Industry |
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Associates : |
Paramount Wires and Cables Limited |
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Subsidiaries |
·
Paramount Holdings Limited, Cyprus ·
AEI Cables Limited, UK ·
Paramount Gulf FZE, Dubai |
CAPITAL STRUCTURE
(As on 31.03.2008)
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
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175000000 |
Equity Shares |
Rs.2/- each |
Rs.350.000 Millions |
Issued, Subscribed
& Paid-up Capital :
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No. of Shares |
Type |
Value |
Amount |
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84506965 |
Equity Shares |
Rs.2/- each |
Rs.169.014 Millions |
Note :
15525800 equity shares of Rs.2/- each were
allotted as fully paid up by way of bonus shares by capitalizing Securities premium
account during FY 2001-02
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
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SOURCES OF FUNDS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
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SHAREHOLDERS FUNDS |
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1] Share Capital |
169.014 |
169.014 |
108.681 |
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2] Share Application Money |
0.000 |
0.000 |
14.580 |
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3] Reserves & Surplus |
1782.615 |
1494.655 |
432.736 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
1951.629 |
1663.669 |
555.997 |
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LOAN FUNDS |
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1] Secured Loans |
1419.680 |
640.087 |
436.869 |
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2] Unsecured Loans |
1487.996 |
1250.028 |
105.774 |
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TOTAL BORROWING |
2907.676 |
1890.115 |
542.643 |
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DEFERRED TAX LIABILITIES |
82.542 |
44.860 |
47.307 |
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TOTAL |
4941.847 |
3598.644 |
1145.947 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
1272.101 |
550.831 |
302.294 |
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Capital work-in-progress |
313.719 |
257.590 |
26.796 |
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INVESTMENT |
273.971 |
28.038 |
29.289 |
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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 |
2114.720
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1260.133
|
555.213 |
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Sundry Debtors |
1483.638
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819.866
|
588.805 |
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Cash & Bank Balances |
63.826
|
1088.903
|
37.551 |
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Other Current Assets |
0.000
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0.000
|
0.000 |
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Loans & Advances |
569.954
|
291.972
|
166.794 |
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Total
Current Assets |
4232.138
|
3460.874
|
1348.363 |
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Less : CURRENT
LIABILITIES & PROVISIONS |
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Current Liabilities |
1150.082
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698.689
|
560.795 |
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Provisions |
0.000
|
0.000
|
0.000 |
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Total
Current Liabilities |
1150.082
|
698.689
|
560.795 |
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Net Current Assets |
3082.056
|
2762.185
|
787.568 |
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MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
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TOTAL |
4941.847 |
3598.644 |
1145.947 |
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PROFIT & LOSS
ACCOUNT
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PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
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Sales Turnover |
4424.107 |
3147.353 |
1958.526 |
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Other Income |
65.710 |
16.312 |
6.079 |
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Total Income |
4489.817 |
3163.665 |
1964.605 |
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Profit/(Loss) Before Tax |
503.229 |
585.245 |
328.567 |
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Provision for Taxation |
175.263 |
205.430 |
113.979 |
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Profit/(Loss) After Tax |
327.966 |
379.815 |
214.588 |
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Earnings in Foreign Currency : |
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Exports on CIF Prices (In Foreign Currency) |
431.710 |
548.898 |
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Exports on CIF Prices |
0.000 |
23.783 |
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Deemed Exports |
199.661 |
130.883 |
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Interest Earned on FDR (Pre-operative) |
18.054 |
19.238 |
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Total Earnings |
649.425 |
722.802 |
105.433 |
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Imports : |
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Raw Materials |
481.704 |
275.320 |
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Stores & Spares |
0.557 |
0.247 |
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Capital Goods |
13.495 |
3.852 |
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Total Imports |
495.756 |
279.419 |
355.006 |
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Expenditures : |
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Materials |
3924.155 |
2566.422 |
1425.008 |
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Manufacturing,
Selling & Other expenses |
488.235 |
372.136 |
210.075 |
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lncrease/(decrease)
excise duty on stock |
62.420 |
51.894 |
11.423 |
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lncrease/(Decrease) in stock |
(862.220) |
(600.613) |
(113.280) |
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Payment to and
Provision for Employees |
65.098 |
41.027 |
34.020 |
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Managerial
Remuneration |
57.662 |
5.466 |
3.569 |
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Financial
Charges |
190.043 |
106.241 |
41.117 |
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Depreciation |
61.195 |
35.847 |
24.106 |
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Total Expenditure |
3986.588 |
2578.420 |
1636.038 |
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QUARTERLY RESULTS
|
PARTICULARS |
30.06.2008 |
|
Type |
1st
Quarter |
|
Sales
Turnover |
1010.100 |
|
Other
Income |
10.000 |
|
Total
Income |
1020.100 |
|
Total
Expenditure |
885.800 |
|
Operating
Profit |
134.300 |
|
Interest |
65.000 |
|
Gross
Profit |
69.300 |
|
Depreciation |
21.100 |
|
Tax |
13.400 |
|
Reported
PAT |
34.800 |
KEY RATIOS
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
Debt-Equity Ratio |
1.33 |
1.11 |
0.82 |
|
Long Term Debt-Equity Ratio |
0.82 |
0.63 |
0.2 |
|
Current Ratio |
2.00 |
2.03 |
1.31 |
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TURNOVER
RATIOS |
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Fixed Assets |
4.37 |
5.82 |
5.04 |
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Inventory |
2.97 |
3.96 |
5.3 |
|
Debtors |
4.36 |
5.11 |
6.09 |
|
Interest Cover Ratio |
3.65 |
6.51 |
9 |
|
Operating Profit Margin(%) |
15.03 |
20.21 |
17.45 |
|
Profit Before Interest And Tax
Margin(%) |
13.81 |
19.22 |
16.38 |
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Cash Profit Margin(%) |
7.75 |
11.44 |
10.57 |
|
Adjusted Net Profit Margin(%) |
6.53 |
10.45 |
9.51 |
|
Return On Capital Employed(%) |
16.52 |
29.95 |
46.63 |
|
Return On Net Worth(%) |
18.23 |
34.41 |
49.12 |
LOCAL AGENCY
FURTHER INFORMATION
HISTORY
Subject was setup in 1978 as a partnership concern under the
name & Style of Paramount Cable Corporation. It was converted into a Public
Limited Co on 5 th September 1994.
Subject was promoted by Shri S.S. Aggarwal. The company has developed a large
Variety of Specialised cables and wires for Customers in Virtually all
infrastructural sectors of the economy viz Telecom, Railways, Electric
utilities, Electronics and various industrial users.
Subject Presently has well diversified range of products which includes all
types of telecommunication cables, power cables, control cable and industrial
uses cables.
Subject came out with public issue during April 1995,for set up a unit for the
manufacture of jelly filled telephone cable with installed capacity of 600000
conductor kilometres (CKM) as part of its diversification programme.
Company has achieved ISO 9002 Certificate for its Delhi Unit and already
received ISO 9002 for its Dharuhera Unit. company declared dividend of 15% for
the year 1998-99.
During the year 1999-2000, with the addition of a complete line of plant and
machinery at Dharuhera Unit, the company was able to enhance its assessed
capacity as certified by Telecom Engineering Centre, Department of
Telecommunications, to 3.562 millions conductor KM (LCKM) per annum from the
earlier assessed capacity of 24.43 LCKM per annum.
PERFORMANCE REVIEW
OF OPERATIONS:
The company has achieved a turnover including other income of Rs. 5085.74
Million and profit after tax of Rs. 327.97 Million for the year 2007-2008 as
compared to Rs. 3614.88 Million and Rs. 379.82 Million respectively for the
previous year 2006-2007.
The company has completed its 2nd phase of expansion project which commenced
commercial production in February, 2008. After completion of 2nd phase
expansion the installed capacity for power cables has increased to 58500 KMs
per annum which includes all types of electric cables viz, LT/HT Power Cables,
Control Cables, Instrumentation Cables, Thermocouple Cables, Railway Signalling
Cables etc.
The company has been able to achieve expansion in all its major market segments
showing growth of more than 40% in turnover including other income. The
profitability of the company is also above the industry average in spite of
competitive pricing in its products and high volatility in the raw material
prices during the year. During the year there was a revival in the demand for
Jelly Filled Telephone Cables, which was easily met by utilizing the swing
capability of the company.
The company's export business has increased from Rs. 82.68 Million to Rs.
431.71 Million during the year showing excellent growth. Company can now target
further growth in export business catering to a wide export market through its
wholly owned subsidiary AEI Cables Limited, United Kingdom. AEI Cable arguably
one of the oldest Cable manufacturer in the world, has an excellent world-wide
track record. The company has kept a target of 100% growth in export business
in the next financial year.
The company has already acquired 25 acres of land opposite to the existing
plant of the company located in the Khushkhera Industrial Area, Rajasthan. This
industrial land has been acquired for setting up of 3rd phase of expansion
project for additional capacities of 35000 KMs per annum of LT Power cables and
2500 KMs per annum of HT Power, cables. The said project is expected to be
operational by the mid of the next financial year.
ACQUISITION
OF AEI CABLES LIMITED, UNITED KINGDOM:
One of the important milestones in the history of the company during the year
is the acquisition of world renowned AEI Cables Limited (AEI), United Kingdom,
which counts amongst the world's oldest cable manufacturers with a lineage
dating back to circa 1837. AEI is having its manufacturing facility at Birtley,
Near New Castle-upon-Tyne in the North East of England. The company acquired
the business of AEI under SPV route through its wholly owned subsidiary,
Paramount Holdings Limited, Cyprus.
AEI supplies cables to the defence, rail, power, construction and mining
sectors. These specialized cables are manufactured with the proprietary know
how of AEI, developed over the last 170 years of pioneering cable manufacturing
experience. AEI has world class research and development facilities which
positions AEI to meet the ever changing demands of customers for these
specialized cables.
The acquisition of AEI by Paramount has:
- Inducted Paramount amongst the largest listed Indian companies in
the cable industry.
- Significantly strengthened its product range for infrastructure
segments such as Railways, Mining, Power and Defence in India and the
UK.
- Enabled faster expansion in international markets such as Far East,
Middle East and Africa, where the AEI brand is well established.
- Given access to cutting edge technical knowhow
FUTURE
OUTLOOK:
It is expected that the development in the infrastructure and industrial sector
will continue to grow in India for next decade. The Indian Railways also have
substantial plans to modernize, replace and augment its network and
services.
In view of the anticipated investment in infrastructure, power, railways and
industrial sectors, the demand for the company's products is expected to grow
in the years to come. Moreover, after having access to the marketing network of
AEI Cables Limited and having 'wider range of products to offer, both AEI and
Paramount are expected to perform better.
MANAGEMENT
DISCUSSION AND ANALYSIS:
Overall Review:
The world has witnessed drastic ups and downs in the economic fortunes of
various nations, while the economies of the west were facing a slow down, the
economies of the developing nations have become stronger with the impressive
growth momentum and rapid industrialization. The year 2007-2008 was historic
for the Indian businessmen as there were record takeovers of iconic
international companies by Indian corporates across the globe. The Indian
entrepreneurs have proved their potential to achieve global leadership.
The company has created history in the cables industry by acquiring arguably
the oldest and one of the most reputed and respected brands in the global
cables industry-AEI Cables Limited, having its state of art manufacturing
facility at Birtley, United Kingdom. AEI Cables Limited, established by WT
Henley in the year 1837 has number of successful historic projects to its
credit.
It is apparent from the current global economic scenario that the development
and growth in the developing nations will continue to be robust. The strong
fundamentals of the Indian economy are indicated by higher production levels,
liberalized Government policies-, availability of highly trained and skilled
work force, world class education facilities, excellent opportunities for
employment and increased per capita income which encourages increased level of
savings and investment which in turn also add the fuel to the growth.
In order to maintain the economic growth rate in India, substantial investments
in infrastructure, industrial expansions and new projects are expected to
continue for next decades too, which is expected to drive further demand for
power, control and instrumentation cables.
Subject is amongst the most reputed and largest manufacturers of diverse types
of high performance cables in India. Paramount is a uniquely positioned
company, which provides complete cabling solutions to almost all sectors of the
economy - Power, Telecom and, Railways, Petrochemicals and Industrial
Sector.
The company has already initiated substantial expansion for increasing the
capacities to manufacture LT and HT power cables in light of the anticipated
growth in demand for these cables. The 2nd phase of expansion plan of the
company has commenced commercial production in the fourth quarter of the financial
year 2007-08 which has created an additional annual capacity of 30000 KMs LT
power cables and 2000 KMs HT power cables in the existing plant of the company
located at Khushkhera Indl Area, Distt Alwar, Rajasthan.
The company has already acquired 25 acres of land opposite to the existing
plant of the company located in the Khushkhera Industrial Area, Rajasthan. This
industrial plot has been acquired for setting up of the proposed 3rd phase of
expansion project for additional capacities of 35000 KMs per annum of LT power
cables and 2500 KMs per annum of HT power cables. The said project is expected
to become operational by middle of financial year 2009-10.
During the year, the prices of main inputs including metals remained highly
volatile, which affected the profitability of cable manufacturers to a great
extent. The profitability of the company is however above the industry average
in spite of competitive pricing of products and high volatility in the raw
material prices during the year. The company undertook various control measures
to minimize risk and secure profitability. The management took proactive steps
to cover its raw material supplies at lowest cost.
Acquisition of AEI Cables Limited,
United Kingdom:
One of the important milestones in the history of the company during the year
is the acquisition of world renowned AEI Cables Limited (AEI), United Kingdom,
which counts amongst the world's oldest cable manufacturers with a lineage
dating back to circa 1837. AEI is having its manufacturing facility at Birtley,
Near New Castle- upon- Tyne in the North East of England. The company acquired
the business of AEI under SPV route through its wholly owned subsidiary,
Paramount Holdings Limited, Cyprus.
AEI supplies cables to the defence, rail, power and mining sectors. These
specialized cables are manufactured with the proprietary know how of AEI,
developed over the last 170 years of pioneering cable manufacturing experience.
AEI has world class research and development facilities which positions AEI to
meet the ever changing demands of customers for these specialized cables.
The acquisition of AEI by Paramount has:
- Inducted Paramount amongst the largest listed Indian company in the
cable industry.
- Significantly strengthened its product range for infrastructure
segments such as Railways, Mining, Power and Defence in India and the
UK.
- Enabled faster expansion in international markets such as Far East,
Middle East and Africa, where the AEI brand is well established.
- Given access to cutting edge technical knowhow.
Industry Structure and
Developments:
With the substantive growth in the economies of the developing nations like
India and huge anticipated investments in infrastructure, power, railways and industrial
projects shall continue to drive good demand for cables. The financial year
2007-08 was a good year in terms of business growth for the company showing
approximately 40% growth on standalone basis and 108% growth on consolidated
basis.
BUSINESS
ANALYSIS AND PRODUCT WISE PERFORMANCE:
Power and Railways Cables:
Subject sold 31067 KMs of Power and Railways Cables having a total value of Rs.
3615.51 Million during the year as compared to 25165 KMs having a total value
of Rs. 3061.71 Million during the previous year, showing a growth of more than
18 percent in terms of value. Power and Railways cables constitute 72% of the
gross turnover of the company for the year 2007-08. Power, infrastructure and
railways sectors are poised for substantial growth due to the ongoing reforms
process having taken strong roots in the economy. Subject is well positioned to
take advantage of the growth in the power sector because of its long and
prestigious track record with most of the major players in the power sector
including National Thermal Power Corporation (NTPC), Bharat Heavy Electricals
Limited (BHEL), Power Grid Corporation of India Limited (PGCIL), Areva, L and
T, various Electricity Boards, Reliance Energy, North Delhi Power Ltd, ABB,
Alstom and Siemens amongst many others. Paramount, by virtue of its high
quality and delivery record expects to gain substantially from demand that will
arise in the coming years. Paramount has already implemented its 2nd phase of
expansion plan and the 3rd phase of expansion plan for power cables shall be
implemented by the middle of financial year 2009-10.
Jelly Filled Telephone Cables
(JFTC):
The widespread adoption of WLL technology and continued thrust on mobile
telephony globally reduced the demand of JFTC. However, the company has shown
excellent performance in JFTC business during the year. The company has sold
0.88 MCKM (million conductor kilometres) of JFTC having a total value of Rs.
1004.09 Million during the year as compared to 0.22 MCKM having a total value
of Rs. 235.54 Million during the previous year showing a growth of more than
3.25 times.
Optical Fibre Cable (OFC):
OFC is mainly used in long distance telecom and data networks and generally
forms the backbone of all telecom networks. It is also used in cable TV
networks and local area networks requiring high-speed connectivity and high
bandwidth. Paramount sold 9527 KMs of Optical Fibre Cables having a total value
of Rs. 144.10 Million during the year as compared to 8276 KMs having a total
value of Rs. 82.54 Million during the previous year, showing a growth of
75%.
Future Outlook Power Sector:
With the rapid growth in industrial and infrastructure sectors, the demand for
power is growing significantly, it is estimated that a demand for power will
rise to 315000-335000 MW by the year 2017. The Government is giving its due
attention to build power infrastructure to meet the challenges posed by the
industrial growth and infrastructural development taking place in India,
besides its project for rural electrification etc. Over 78577 MW of new
generation capacity is proposed to be added by 2012, which require
approximately INR 9 trillion ($200bn). These power projects will give rise to
substantial demand for power cables.
Railways Cables:
The Annual Plan of Rs 375000 Million for 2008-2009 is the largest so far in the
history of Indian Railways representing an increase of 21% over the previous
year's plan. Of this outlay, Traffic Facilities (9840 Million), Doubling (25000
Million), New Lines (17300 Million), Track Renewal (36000 Million) Gauge
Conversion (24890 Million), Electrification (6260 Million), Passenger Amenities
(8520 Million) and Signalling and Telecom (15200 Million) works comprise the
major constituents. In addition, an amount of Rs. 15350 Million has been
allocated to Rail Vikas Nigam Limited.
The above mentioned planned works will require a substantial part of the plan
outlay to be spent on the purchase of railway signalling, power and optical
fibre cables. It is estimated that Railways will be required to spend close to
Rs. 9000 Million in the year 2008-09 for procurement of various types of cables
for completing these planned works.'
Telecom Sector:
The telecom sector continued to register significant growth during the year and
has emerged as one of the key sector responsible for India's resurgent economic
growth. With more than 270 million mobile connections, India's
telecommunication network is second largest in the world. This has been
possible due to the supportive Government policies coupled with private sector
initiatives. Tele-density has also increased from 12.7 per cent in March 2006
to 23.9 per cent in December 2007. Rural tele-density has increased to 7.9 per
cent at the end of November 2007. In addition to this, growing cellular
infrastructure requires different types of cables including Optical Fibre
Cables. Telecom cables will continue to be required by BSNL/MTNL for rural
fixed line connections and/or replacement of existing JFTC Cables.
In view of the anticipated investments in infrastructure, power, railways and
industrial sector, it is expected that the demand for the company's products
will continue to be robust. Capacity expansion for LT and HT power cables will
further add to the turnover in the future years. It is expected that the
turnover of the company and its profitability will increase substantially
during the next financial year if the development taking place in the
infrastructure, power and industrial sector continues to grow at the expected pace.
Competition and Company's Business
Strategy:
Subject is known for the quality of its cables and the company's research team
is fully committed to develop tailor made, and innovative cables, which suit
the requirements of the customer. The company put utmost attention to control
cost of production and provide value for money to its customers. The company is
also strengthening its nationwide marketing network.
Exports:
The company's export business has increased from Rs. 82.68 Million to Rs. 431.71
Million during the year showing excellent growth. Company can now target
further growth in export business catering to world-wide export markets through
its wholly owned subsidiary AEI Cables Limited, United Kingdom. AEI has a long
presence supplying various types of cables globally with excellent track
record. The company targets 100% growth in export business in the next
financial year.
Financial Performance:
The company achieved sales turnover of Rs. 5020.03 Million for the year ended
31st March, 2008 as compared to Rs. 3598.57 Million during the previous year.
The sales turnover of the company has increased by more than 39% over the
previous year. The company has achieved a net profit of Rs. 327.70 Million as
compared to Rs. 375.86 Million for the previous year 2006-07.
The company has achieved consolidated turnover of Rs. 7452.37 Million and net
profit of Rs. 635.32 Million for the year ended 31 st March, 2008 as compared
to Rs. 3598.57 Million and Rs. 375.38 Million respectively during the previous
year showing a growth of 107% in turnover and 69% in net profit.
Total financial charges during the year have increased from Rs. 106.24 Million
to Rs. 190.04 Million, which is 3.78% of the turnover of the year as compared
to 2.95% in the previous year. The increase is mainly because of interest paid
during the year on additional funds raised byway of loans from the banks and
FCCBs to finance company's expansion projects and investment in subsidiary
companies. The average cost of funds during the year has also increased
substantially.
Borrowing position
Borrowings excluding working capital facilities as at 31st March, 2008 are Rs.
1328 Million as compared to Rs. 1293.16 Million during the previous year. These
borrowings include FCCBs Rs. 1080 Million, sales tax deferment loan Rs. 28.79
Million, term loans from banks Rs. 188 Million, hire purchase finance Rs. 0.97
Million, inter corporate deposits Rs. 8.92 Million and directors deposits Rs.
21.32 Million. The debt equity ratio of the company as at 31-03-2008 is 1.14:1;
as compared to 1.49.1 as at 31-03-2007.
FIXED ASSETS
- Land
- Land
(Leasehold)
- Buildings
- Plants and
Machinery
- Electrical
Fitting and Equipments
- Furniture and
Fixtures
- Vehicles
- Assets
acquired under Hire Purchase: -Vehicles
CONTINGENT LIABILITIES
- Guarantee of Rs.50.000 Millions given
to a Bank for credit facilities given to Paramount Wires and Cables
Limited. Credit facilities availed by the said company as on 31.03.2008.
Rs. NIL for fund based limits and Rs. NIL for non-fund based limits.
- The Company has executed a 7% fixed
rate guaranteed unsecured loan note 2008 of Sterling Pounds 930000 towards
deferred consideration for acquisition of assets of AEI Cables Limited,
UK, a wholly owned subsidiary of the Company. The amount outstanding
together with interest accrued thereon as on 31st March, 2008
is Rs.77.283 millions.
- The Company has executed a parental
guarantee in favour of One North East, UK an agency of British Government
responsible for promoting investment in UK, on behalf of its wholly owned
subsidiary, AEI Cables Limited for guaranteeing the repayment of Grant of
Rs.31.936 millions (Sterling Pounds 400000) extended to it together with
the interest at the rate of 1.5 percentage points above the UK base rate
of Bank of England calculated from the date of first demand to AEI Cables
Limited till the date of actual payment, In case AEI Cables Limited fails
to observe the terms and conditions stipulated in the offer letter while
giving the Grant.
- Unused letter
of credit outstanding Rs. 50.464 Millions
- Financial
Bank Guarantees outstanding Rs. 29.751 Millions
- Effect of
Income tax demands/disallowances against which appeal/rectifications have
been filed by the
- company is
Rs. 2.674 Millions
- Outstanding Bills
discounted Rs. 156.612 Millions
Working Capital facilities from Banks are
secured by 1st Pari-Passu charge by way of hypothecation on the
entire current assets including raw material, stocks in process, finished goods,
consumables stores and spares and receivables of the Company and 2nd
Pari-Passu charge on present and future fixed assets other than land and
building at Prahaladpur, Bawana Road, Delhi. Further they are secured by
personal guarantees of Shri Sanjay Aggarwal and Shri Sandeep Aggarwal,
Directors of the Company.
Term loans from bank is secured by 1st
Pari passu charge on present and future fixed assets of the company other than
land and building at Prahaladpur, Bawana Road, Delhi and 2nd
pari-passu charge on present and future current assets of the Company. Further
they are secured by personal guarantees of Shri Sanjay Aggarwal and Shri
Sandeep Aggarwal, Directors of the Company.
Hire Purchase Finance is secured against
assets financed from it.
Deferred Sales Tax Loan is covered by Bank
Guarantee to the extent of 15% of the loan amount entitled and surety bond for
the balance amount executed by the Managing Director of the Company.
NON-FINANCIAL TRANSACTIONS
The Company has executed a parental guarantee
in favour of One North East, UK, an agency of British Government responsible
for promoting investment in UK, on behalf of its wholly subsidiary AEL Cables
Limited for guaranteeing the repayment of Grant of Rs.31.936 millions (Sterling
Pound 400000) extended to it together with the interest at the rate of 1.5
percentage points above the UK base rate of Bank of England calculated from the
date of first demand to AEI Cables Limited till the date of actual payment, in
case AEI Cables Limited fails to observe the terms and conditions stipulated in
the offer letter while giving the Grant.
IT IS
IN TRADE TERMS WITH:
·
Bharat Sanchar Nigam Limited (BSNL)
·
National Thermal Power Corporation Limited (NTPC)
·
Bharat Heavy Electricals Limited (BHEL)
·
Research, Development and Standards Organisation (RDSO)
·
Indian Space Research Organisation
·
Power Grid Corporation of India Limited (PGCIL)
·
Indian Oil Corporation Limited (IOCL)
·
Gas Authority of India Limited (GAIL)
·
Engineers India Limited (EIL)
·
Project Development India Limited (PDIL)
·
Oil and Natural Gas Corporation Limited (ONGC)
·
Centre for Development of Telematics (C-DOT)
·
Department of Atomic Energy (DAE)
·
Naval Science and Technological Lab (NSTL)
·
Lloyd’s Register Industrial Services (India) Limited (LIS)
·
Tata Consulting Engineers (TCE)
·
Desein Engineers and Consultants (Private) Limited (DECL)
·
Development Consultants Limited (DCL)
·
HOLITECH
·
Engineering Projects India Limited (EPIL)
·
Mahanagar Telephone Nigam Limited (MTNL)
·
Telecommunication Consultants of India Limited (TCIL)
·
Indian Railway Construction Company (IRCON)
·
Rail India Technical and Economics Services Limited (RITES)
·
Bharti
·
Hughes Tele.com
·
HFCL InfoTel
·
Shyam Telelinks
WEB DETAILS
Overview
Subject is proud to have reached a major milestone to its already growing track record. The Company has been awarded ISO 9001 and 14001 by Moody International, bearing eloquent testimony to the stringent quality that is the hallmark of Paramount products. The certification is but one more guarantee that the clientele can be rest assured of total satisfaction.
Subject caters to a wide range of industries with an equally wide range of technologically advanced cables, cords and wires for Telecommunication, Railways, Space Research, Thermal and Nuclear Power Plants, Petrochemical, Fertilizers, Steel, Electronics and various other industries.
Incorporated in 1978, the Company swiftly established a name for itself and embarked on an exponential growth trajectory. Visionary diversification began with the move into special cables in the early ‘80s, supported by a dedicated team of technocrats and experts.
Subject has always
laid major emphasis on keeping abreast with the latest international
developments, focusing and adapting technology to create multi-faceted,
need-based products for utilization in various spheres of industrial activity.
History
The founder late Sh. S.S. Aggarwal launched Paramount Cables in the year 1955 by setting up a small cable manufacturing unit as a family venture along with his brothers.
In the year 1978 he established a new unit under the name of Paramount Cable
Corporation which started supplying telecom cables to the Department of
Telecommunications.
This unit grew into one of the largest cable makers in India and was converted
into a company, Paramount Communications Limited in the year 1994. Today Subject along with its group company
Paramount Wires and Cables Limited is one of the largest cable manufacturing
companies in India. With a wide product basket and superior technical expertise
paramount caters to the requirement of several national and international
customers from almost all the sectors of the economy.
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.48.43 |
|
UK Pound |
1 |
Rs.84.54 |
|
Euro |
1 |
Rs.65.91 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
8 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
8 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
72 |
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 |
|