MIRA
INFORM REPORT
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Report Date : |
17.10.2008 |
IDENTIFICATION
DETAILS
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Name : |
BEML LIMITED |
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Formerly Known As : |
BHARAT EARTH MOVERS LIMITED |
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Registered Office : |
"BEML Soudha", 23/1, 4th Main Road, P. B. No.
2769, Sampangirama Nagar, Bangalore - 560 027, Karnataka |
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Country : |
India |
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Financials (as on) : |
31.03.2008 |
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Date of Incorporation : |
11.05.1964 |
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Com. Reg. No.: |
1530 |
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CIN No.: [Company
Identification No.] |
L35202KA1964GOI001530 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
NGPB01658G |
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PAN No.: [Permanent
Account No.] |
AAACB8433D |
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Legal Form : |
Subject is a Government of India Undertaking
Company having limited liability. The
company's shares are listed on the Stock Exchanges. |
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Line of Business : |
Manufacture of Rail Coaches & Spare Parts and Mining
Equipment |
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 90000000 |
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Status : |
Excellent |
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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 satisfactory
track. It is a Government of India
Company. The company's general
financial position is satisfactory.
However, profitability is under severe pressure. Lenders and Creditors can feel confident
of Government of India's exposure to the company. Payments are usually correct and as per commitments. The company can be considered normal for business dealings at usual
trade terms and conditions. |
LOCATIONS
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Registered/ Corporate Office : |
"BEML Soudha", 23/1, 4th Main Road, P.
B. No. 2769, Sampangirama Nagar, Bangalore - 560 027, Karnataka, India |
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Tel. No.: |
91-80-222 4141 (13 lines) |
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Fax No.: |
91-80-222 6883 / 222 4451 / 2276443/ 22963278/ 516/ 280/
164 |
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E-Mail : |
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Website : |
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Division
Office: |
Marketing Division 5th Floor, Unity Buildings,
JC Road, Bangalore-560002,Karnataka,India Ph: 91 80 22963501 Fax: 91 80
22963539 Email: mmoffice@sales.beml.co.in International Business Division BEML SOUDHA, 23/1,
4th Main, SR Nagar, Bangalore-560027, Karnataka, India. Fax: 91 80
22224874 Email: bemlexp@vsnl.com,
office@export.beml.co.in,bemlexp@vsnl.net Technology Division BEML SOUDHA, 23/1,
4th Main, SR Nagar, Bangalore-560 027. Karnataka, India. Fax: 91 80
22963101 Email: office@ctd.beml.co.in
Trading Division 5th Floor, Unity
Buildings, JC Road, Bangalore-560002, Karnataka, India. Ph: 91 80 22963522 Fax: 91 80
22963523 Email: office@trading.beml.co.in |
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Steel Foundry : |
Vignyan Industries
Limited, PB No.4, BH Road, Tarikere-577
228. Karnataka, India Ph: 91 8261
222236, 222252, 222357 Fax: 91 8261
222236 Email:
vittke@sancharnet.in |
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Regional Offices : |
Located at :-
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District Offices : |
Located at :-
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Plant Locations : |
Bangalore Complex
P. B. No. 7501, New Thippassandra Post, Bangalore – 560075, Karnataka, India Tel No.:91-80-25242414 (20 Lines) Fax No.:91-80-25245545/ 25242942 Email : Office@dr.beml.co.in KGF Complex
BEML Nagar, Kolar Gold Fields – 563 115, Belavadi Post, Mysore – 571186, Karnataka, India Tel No.:91-8153-263020 (10 Lines)/ 263280 (20 Lines) Fax No.:91-8153-261003/262610/263128 Email : dmc@em.beml.co.in Mysore Complex
Belavadi Post, Mysore – 571186, Karnataka, India Ph: +91 821 2402422 (24 lines) Fax: +91 821 2402434, 2402429, 2402442 |
DIRECTORS
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Name : |
Mr. V. RS. Natarajan |
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Designation : |
Chairman and
Managing Director |
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Name : |
Mr. A. Prasad |
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Designation : |
Director |
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Name : |
Mr. Prakash G. Apte |
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Designation : |
Director |
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Name : |
Mr. Birendra Kumar |
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Designation : |
Director |
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Name : |
Mr. KVK Seshvataram |
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Designation : |
Director |
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Name : |
Dr. Arabinda Tripathy |
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Designation : |
Director |
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Name : |
Mr. S. N. Chary |
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Designation : |
Director |
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Name : |
Mr. N. R. Mohanty |
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Designation : |
Director |
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Name : |
Dr. Jayanta Bagchi |
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Designation : |
Director |
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Name : |
Mr. V. Mohan |
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Designation : |
Director |
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Name : |
Mr. M. Poongavanam |
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Designation : |
Director (Mining and Construction Business) |
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Name : |
Mr. P. Dwarakanath |
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Designation : |
Director (Metro and Rail Buisness) |
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Name : |
Mr. M. Pitchiah |
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Designation : |
Director (Finance) |
KEY EXECUTIVES
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Name : |
Mr. Satyajeet Rajan |
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Designation : |
Joint Secretary (Exports) Department of Defence Production, Ministry of Defence |
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Name : |
Mr. Dilip Biswas |
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Designation : |
Addl. Financial Adviser and Joint Secretary Department of Defence Production, Ministry of Defence |
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Name : |
Mr. APVN Sarma |
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Designation : |
Joint Secretary
[Coal] Ministry of Coal and Mines |
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Name : |
Mr. Abhijit Basu |
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Designation : |
Additional Financial
Advisor [B] and Joint Secretary, Ministry of Defence |
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Name : |
Mr. Tapan Ray |
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Designation : |
Joint Secretary
[Export], Department of Defence Production and Supplies, Ministry of Defence |
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Name : |
Mr. Mohd. Haleem Khan |
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Designation : |
Joint Secretary
& Additional Financial Advisor (Department of Defence Production,
Ministry of Defence) |
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Name : |
Mr. K. C. Medapa |
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Designation : |
Company Secretary |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
(As on 31.03.2008)
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Category |
No of Shares |
% of Shares |
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Promoters |
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The President of India |
22500000 |
54.03 |
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Institutional Investors |
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Mutual Funds and UTI |
6001284 |
14.41 |
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Banks/Financial Institutions/Insurance Companies [Central
/State Government Institutions/Non-Government Institutions] |
2491994 |
5.98 |
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FIIs |
6663993 |
16.00 |
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Others |
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Private Corporate Bodies |
1239445 |
2.98 |
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Indian Public |
2472636 |
5.94 |
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NRIs/OCBs |
237526 |
0.57 |
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Any Other – Trust |
37622 |
0.09 |
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Total |
36744500 |
100.00 |
BUSINESS DETAILS
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Line of Business : |
Manufacture of Rail Coaches & Spare Parts and Mining
Equipment |
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Products : |
Railway Products :
Defence Equipment :
EM Equipment
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Exports : |
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Imports : |
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GENERAL
INFORMATION
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Customers : |
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No. of Employees : |
13116 |
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Bankers : |
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Facilities : |
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Banking Relations
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Good |
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Auditors : |
Rao and Swami Chartered Accountants |
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Collaboration
: |
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Memberships: |
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Associates/Subsidiaries : |
Vignyan Industries Limited , Haliyur Village (Outskirts of
Tarikere), B. H. Road, Tarikere - 577 228 Tel No. 91-8261-22236 / 22252 / 22314 Fax No. 91-8261-22357 |
CAPITAL STRUCTURE
Authorised Capital :
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No. of Shares |
Type |
Value |
Amount |
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100000000 |
Equity shares |
Rs.10/- each |
Rs.1000.000 millions |
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Issued Capital
:
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No. of Shares |
Type |
Value |
Amount |
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41900000 |
Equity shares |
Rs.10/- each |
Rs.419.000 millions |
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Subscribed &
Paid-up Capital :
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No. of Shares |
Type |
Value |
Amount |
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36744500 |
Equity shares |
Rs.10/- each |
Rs.367.445 millions |
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Add : |
Issued during the year 4900000 Equity shares
of Rs.10/- each |
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Rs.49.000 millions |
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Add : |
Forfeited Shares |
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Rs.1.277 millions |
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Total |
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Rs.417.722 millions |
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 |
417.722 |
368.722 |
368.700 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
16639.281 |
9966.145 |
8428.400 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
17057.003 |
10334.867 |
8797.100 |
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LOAN FUNDS |
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1] Secured Loans |
3032.680 |
255.737 |
248.800 |
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2] Unsecured Loans |
0.000 |
0.000 |
0.000 |
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TOTAL BORROWING |
3032.680 |
255.737 |
248.800 |
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DEFERRED TAX LIABILITIES |
0.000 |
12.386 |
0.000 |
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TOTAL |
20089.683 |
10602.990 |
9045.900 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
2105.773 |
1438.564 |
1252.000 |
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Capital work-in-progress |
246.340 |
282.603 |
175.900 |
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INVESTMENT |
79.488 |
25.264 |
25.300 |
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DEFERREX TAX ASSETS |
30.280 |
0.000 |
0.000 |
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CURRENT ASSETS, LOANS & ADVANCES |
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Inventories |
9295.800
|
7292.753 |
6490.800 |
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Sundry Debtors |
14960.562
|
9042.563 |
7702.100 |
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Cash & Bank Balances |
5210.953
|
3478.398 |
3800.000 |
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Other Current Assets |
190.801
|
60.911 |
0.000 |
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Loans & Advances |
1551.882
|
838.905 |
1741.900 |
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Total
Current Assets |
31209.998
|
20713.530 |
19734.800 |
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Less : CURRENT
LIABILITIES & PROVISIONS |
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Current Liabilities |
13044.072
|
11550.748 |
12054.200 |
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Provisions |
677.506
|
495.181 |
346.000 |
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Total
Current Liabilities |
13721.578
|
12045.929 |
12400.200 |
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Net Current Assets |
17488.420
|
8667.601 |
7334.600 |
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MISCELLANEOUS EXPENSES |
139.382 |
188.958 |
258.100 |
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TOTAL |
20089.683 |
10602.990 |
9045.900 |
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PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
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Sales Turnover |
25395.988 |
24238.678 |
22055.100 |
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Other Income |
948.277 |
554.097 |
705.700 |
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Total Income |
26344.265 |
24792.775 |
22760.800 |
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Profit/(Loss) Before Tax |
3480.136 |
3160.368 |
2854.300 |
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Provision for Taxation |
1223.598 |
1111.098 |
985.000 |
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Profit/(Loss) After Tax |
2256.538 |
2049.270 |
1869.300 |
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Expenditures : |
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Cost of Goods Sold |
16095.668 |
14840.282 |
11284.900 |
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Manufacturing Expenses |
2118.180 |
0.000 |
3478.200 |
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Administrative Expenses |
0.000 |
0.000 |
3206.200 |
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Raw Material Consumed |
2272.042 |
0.000 |
0.000 |
|
|
Increase/(Decrease) in Finished Goods |
(1136.021) |
110.418 |
248.600 |
|
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Salaries, Wages, Bonus, etc. |
0.000 |
0.000 |
0.000 |
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Managerial Remuneration |
76.931 |
3637.898 |
899.100 |
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Interest |
144.339 |
31.158 |
72.600 |
|
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Depreciation & Amortization |
176.968 |
135.187 |
141.200 |
|
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Other Expenditure |
3116.022 |
2877.464 |
575.700 |
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Total Expenditure |
22864.129 |
21632.407 |
19906.500 |
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QUARTERLY RESULTS
|
PARTICULARS |
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30.06.2008 1st
Quarter |
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Sales Turnover |
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|
2879.200 |
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Other Income |
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|
211.200 |
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Total Income |
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|
3090.400 |
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Total Expenditure |
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|
3156.900 |
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Operating Profile |
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(66.500) |
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Interests |
|
|
57.600 |
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Gross Profit |
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|
(124.100) |
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Depreciation |
|
|
48.200 |
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Tax |
|
|
2.000 |
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Reported PAT |
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|
(174.300) |
KEY RATIOS
|
PARTICULARS |
|
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
Debt-Equity Ratio |
|
0.12
|
0.03 |
0.06
|
|
Long Term Debt-Equity Shares |
|
0.00
|
0.00 |
0.00
|
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Current Ratio |
|
1.78
|
1.62 |
1.50
|
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TURNOVER RATIOS |
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Fixed Assets |
|
4.25
|
4.48 |
3.98
|
|
Inventory |
|
3.27
|
3.77 |
3.47
|
|
Debtors |
|
2.26
|
3.11 |
3.20
|
|
Interests Cover Ratio |
|
16.07
|
57.34 |
40.32
|
|
Operating Profit Margin (%) |
|
14.34
|
12.89 |
13.91
|
|
Profit Before Interests and Tax Margin (%) |
|
13.68
|
12.37 |
13.27
|
|
Cash Profit Margin (%) |
|
8.97
|
8.40 |
9.12
|
|
Adjusted Net Profit Margin (%) |
|
8.32
|
7.88 |
8.48
|
|
Return On Capital Employed (%) |
|
24.45
|
33.52 |
35.51
|
|
Return On Net Worth (%) |
|
16.48
|
21.42 |
23.16
|
LOCAL AGENCY
FURTHER INFORMATION
HISTORY:
Subject (formerly Bharat Earth Movers Limited), a Mini-Ratna Status, the largest and most profitable construction equipment company was established in May of the year 1964 for manufacture of Rail Coaches & Spare Parts and Mining Equipment at its Bangalore Complex. Company has eight manufacturing units spread over four locations. The main manufacturing facilities are located at Kolar Gold Fields, Mysore and Bangalore. These incorporate sophisticated facilities like CNC machines, hi-tech welding equipment and flexible manufacturing systems to turn out cutting-edge technology products. All three manufacturing facilities are certified for ISO 9001-2000. Company operates on three major business verticals for associated equipment manufacturing Mining & Construction, Defence and Rail & Metro. In addition, there are three services verticals Technology Division for providing end-to-end engineering solutions, Trading Division for dealing in non-company products and International Business Division for export activities.
Established the heavy earthmoving equipment division at Kolar Gold Fields in
the year 1968. The collaboration agreement was made with Komatsu Limited, Japan
during the year 1979 for technical know-how in the manufacture of a wide range
of earthmoving equipments such as bulldozers. The Company's Dump Truck division
was established in the year 1985 at Mysore. After a year, in 1986, Company had
received National Import Substitution Award from Ministry of Science
Technology, GoI. An exclusive hydraulics and power line division and a
full-fledged research and development center had set up at Kolar Gold Field
during the year 1987. The Company assembled and launched the Asia's largest
170-ton electric dump truck in the year of 1990. The Engine division was set up
at Mysore in the year 1991 for manufacturing heavy-duty diesel engines. The
Company was promoted and owned by the Government of India under the
Administrative control of Ministry of Defence, Department of Defence Production
and Supplies, later at, in the year 1992, BEML has partially disinvested and
presently Government of India owns 54 percent of total equity and rest 46
percent is held by Public, Financial institutions, Foreign Institutional
Investors, Banks and Employees. Mammoth equipment walking dragline' was
launched during the year 1994.
During the year 1998, the company bagged orders against World Bank tenders
valued at Rs.7000.000 Millions for equipment supply to CIL projects. Integrated
hi-tech applications program implemented in divisions during the year 1999
covering manufacturing, operations and communications. During 1999-2000, the
company had entered into strategic alliances with multinational companies like
M/s Steelfields, UK, Kawasaki, Japan, Europactor, Spain, Crossmobil, Germany
and Hartl Crushtek, UK, which for improve and growth the opportunities. In
2000-2001, BEML tied up with Technology Information Forecasting &
Assessment Council (TIFAC) for manufacturing specialised equipment to be used
in disaster management and is planning to productions them for deployment in
hazardous situations. The Company awarded the Best Exporter award by the
Department of Industry & Commerce, GoK in the year 2001 and also in 2002.
Company had entered into the metro Railway business during the year 2003 with
the manufacture and supply of hi-tech stainless steel metro coaches to the
Delhi Metro Rail Corporation.
The company has opened a new Railway Fabrication Unit at Kolar Gold Field
Complex in the year 2004. In the same year 2004, 7 T Class Excavator - BE71 and
Backhoe loader - BL 9H were formally launched and also the four cylinder
indigenous engine B4D105 had introduced as an earth moving equipment. During
the year 2005, the company's Railway Fabrication Unit was inaugurated at KGF.
The Company had received an award for Outstanding Export Performance' from
Engineering Export Promotion Council (EEPC) during February of the year 2005.
In 2006, it has launched company-wide 'Six Sigma' movement and is currently
spearheading the 'Second Wave' of Six Sigma initiatives. BEML had conferred the
Mini-Ratna (Category 1) status in 29th August of the year 2006 by the ministry
of Defence. The status has been given recognizing position in the industry,
consistent performance, growing profitability and rapid absorption of changing
technologies.
BEML Midwest Limited, a Joint Venture Company was incorporated in April 2007 at
Hyderabad, India to undertake Contract Mining along with Midwest Granite
Private Limited, Hyderabad and Pt. Sumber Mitra Jaya, Jakarta, Indonesia as
partners. A consortium of Subject, Mitsubishi and Rotem has formally got the
Delhi Metro Rail Corporation's order in the year 2007, worth of Rs.11440.000 Millions
for metro coaches. Subject was conferred the Largest & Most Profitable
Construction Equipment Company Award at the Construction World-NICMAR Awards
2007 and also BMEL conferred the Star Performer Award' by Engineering Export
Promotion Council, Southern Region on 24th November 2007.
As on March 2008, the Memorandum of Understanding (MoU) was made with National
Aluminum Company (NALCO) to collaborate for the production of aluminum wagons
for movement of ore for NALCO. During May of the year 2008, the company has
signed a long-term agreement for 12 years with Coal India Limited for joint
production of 'Off the Road' (OTR) tyres to meet the requirement for production
by company and after Sale Requirement by Coal India Limited. Company had
entered into a MoU with Steel Authority of India Limited (SAIL) for Supply of
Heavy Earth Moving Equipment and Maintenance Contract during the same month,
May of the year 2008. As at July 2008, BMEL has bagged export orders for supply
of 93 equipments valued Rs.1580.000 Millions consisting of Hydraulic
Excavators, Rear Dump Trucks and Bull Dozers from Pt. Fajar Bumi Sakti,
Indonesia.
Subject is running to become a market leader, as a diversified company,
supplying products and services Mining & Construction, Rail & Metro and
Defence sectors and globalize its presence. Also improve competitiveness
through organizational transformation and collaboration/ strategic alliances/
joint ventures in technology, attract and build people in a rewarding and
inspiring environment by fostering creativity and innovation.
TURNOVER
AND PROFITABILITY:
For the year 2007-08, the company attained a Turnover of Rs.27130.000 Millions,
Value of Production of Rs.28270.000 Millions, Profit Before Tax of Rs.3480.000
Millions and the Profit After Tax stood at Rs.2260.000 Millions recording an
increase of 4.29% in turnover, 9.12% in value of production, 10.12% in PBT over
the previous year which has been attained through controlling product-mix of
equipments, increase in spares business, cost reduction and economy measures
introduced and after taking additional burden towards wage revision pending
settlement and Rs.40.600 Millions towards voluntary retirement scheme.
EXPORTS:
The International business achieved a turnover of Rs.2006.200 Millions
(including Trading) recording a growth of 81% over 2006-07. The international
presence of the company has increased to more than 50 countries including
Indonesia, China, Thailand, Oman, Saudi Arabia, Zimbabwe, Sudan and Myanmar to
which entry was made during the year.
QUALITY:
Company has a vision to become a market leader, as a diversified company,
supplying products and services to Mining & Construction, Rail & Metro
and Defence sector and globalize its presence. In order to fulfill the
company's vision, continuous efforts are being made to improve quality in all
spheres of its activities. Some of the measures taken are.
- Services of expert consultants have been engaged to improve quality in
critical areas like welding, fabrication & painting and also to bring in
work-place improvement through 5S methodology.
- 'Six-sigma' voyage is continuing with various ongoing projects covering
areas of quality/ productivity improvement.
- 'Lean Management' principles are being adopted to reduce all types of
wastages / non-value added activities and provide value for money and
customer.
- Efforts are on to have a large number of Quality circles to carry out
small group activities and bring in continual improvements in product and process
quality. Company-wide competitions are being conducted and teams are sponsored
for competitions at Regional and National levels by various quality
forums.
- All manufacturing divisions continue to hold ISO 9001-2000 Quality
Management System certifications. Laboratories at R&D-KGF and Engine
Division, Mysore hold NABL accreditations.
- Vendor development remains the focus area to improve quality of vendors
supplies. Experts from BEML are being deputed to guide the suppliers for
improvement of technology, skills and quality systems. Guidelines have also
been sent to the vendors' to work towards obtaining self-certification status
for their supplies.
- Cross-functional teams / quality improvement teams are active
throughout the company who voice customers' valuable feedback, useful for
enhancing product quality.
SUBSIDIARY
COMPANY:
SMALL SCALE AND ANCILLARY INDUSTRIES:
Vignyan Industries Limited, Tarikere has reported improved results with all
time high Turnover of Rs.332.900 Millions, Value of Production of Rs.324.100
Millions, Profit Before Tax of Rs.18.400 Millions recording a growth of 36% in
turnover, 24% in value of production and 27% in profit before tax over the
previous year.
The company has drawn a perspective plan for the next 5 years and set the
targets to maximize its productivity, diversify its products range and
profitability. To meet the goal set in the perspective plan as also to improve
quality, the company is installing continuous moulding system with a capital outlay
of about Rs.100.000.
JOINT VENTURE COMPANY:
A JV Company, M/s BEML Midwest Limited incorporated on 18th April, 2007 at
Hyderabad is a professionally well knit company with company having 45% share, M/s
Midwest Granite Private Limited, and P T Sumber Mitra Jaya of Indonesia as
partners with 55% share. The JV Company obtained certificate of commencement of
business on 8th June, 2007. The Board of the JV Company comprises of three
Directors from company and four Directors from Midwest Granite P Limited. Shri
VAS. Natarjan, CMD of company is the Chairman of BEML Midwest Limited. The JV
Company has a paid-up share capital of Rs.120.500 Millions of which C
investment is Rs.54.200 Millions. The company has been established to exploit
the growing business opportunities in the mining segment. The company has
adopted 15 months for the first financial period considering that the
commencement of business certificate was received during June, 2007.
The company continued to encourage Small Scale and Ancillary Units by providing
technical guidance, requisite support, etc. The quality control personnel
visitthe industries to assist and ensure that the quality of the products meet
the requisite standards.
During the year 2007-08, the company procured items worth Rs.1631.800
Millions from these units.
RAJBHASHA:
The Company continues its efforts to popularize the use of Hindi in all the
official communications. Several steps were taken to use Rajbhasha in the
company. Joint Inspection Committee of DOL and MoD inspected their Regional
Office, New Delhi. The Committee has appreciated the progress of Official
Language in the company and some creative suggestions were made for further
improvements in some areas.
Hindi Diwas and Hindi Week were organized during the year in the
Corporate Office and all Complex offices. Various Hindi competitions were
conducted. Official Language Implementation Committees are constituted as per
requirement/ guidelines in all Complex and major regional offices. To inculcate
interest and efficiency among the staff, Hindi workshops are organized at
regular intervals. Website of the company made available in Hindi also.
Articles in Hindi are published in the house journal 'BEML News'.
AWARDS:
The performance of the company during the year 2006-07 had fetched the
following awards / accolades:
- Excellent MoU rating for the 2nd year in succession from DPE based
on Audited Results.
- SCOPE award for excellence and outstanding contribution to the
pubic sector management-medium PSE category 2006-07.
The Indian Institute of Materials Management (IIMM), Mumbai,
propagating professionalism in the Materials Management in India has
unanimously selected Sri V.R.S. Natarajan, CMD as the best CEO (Public Sector)
for the year 2007 for his ardent role in accelerating the growth of the
organization and the award has been presented on 30.11.2007.
In appreciation of the global impact in international business, the Engineering
Export Promotion Council, Southern Region, has conferred the Star Performer
Award on company.
The company has bagged Construction World-Nicmar Award 2007 from Government of
India in recognition of its being the 'Largest & Most Profitable
Construction Equipment Company in India'.
MANPOWER:
The manpower strength as on 31St March, 2008 stood at 12,286 as against 11,748
of the previous year. Representation of SC/ST and Ex-Servicemen category-wise
as on 01.01.2008 and recruitment made are as under:
Representation of SC/ST/Ex-Servicemen as on 01.01.2008.
MANAGEMENT
DISCUSSION & ANALYSIS REPORT:
INDUSTRY STRUCTURE AND DEVELOPMENTS:
The company is a Mini Ratna Catergory-I Public Sector
Undertaking under the control of Ministry of Defence dealing with three product
segments comprising of Mining & Construction Equipments, Railway Rolling
Stocks & Metro Rail Coaches and Defence Equipment & Aggregates. The
Mining & Construction equipment caters to the core sector of industry viz.,
mining, irrigation, steel, cement, power plants, infrastructure, etc., Railway
products caters to the Railways and Metro & Defence products cater to
Defence Services. The company has three manufacturing plants located at Kolar
Gold Fields, Bangalore and Mysore each of which is interdependent.
In addition to this, company has two new Divisions viz., Trading Division and
Technology Division. Trading division was formed with a view to maximize
business through sale of components and engineering spares. This will also
ensure supply of high-quality components for both in-house consumption as well
as existing customers. Leveraging on the company brand for both company and
non-company products to serve customers using the vast marketing network of the
company. Technology division has been set up with four business verticals viz.,
Defence, Aerospace, Rail & Metro, Auto & Mining for tapping the
potential of BEML's assets accumulated in terms of knowledge and talent built
over four decades. Drawing from the rich and diverse expertise of R&D in
various realms of technology with extensive use of CAD / CAE / CAM, it will
offer services like product design, process engineering, plant automation,
enterprise management services and implementation of collaborative product
engineering. Both the Divisions are just a year old and commenced its
operations recording a modest beginning.
To exploit the opportunities in the international market for earth moving
equipments a separate International Business Division as a SBU has been
established. As an export house with 'Star Exporter' status, company's
operations in the international market are growing. The Company has its
presence currently in more than 50 countries in Asia, Africa, Europe, Middle
East and Latin America.
The company has a subsidiary namely, M/s Vignyan Industries Limited located at
Tarikere wherein castings are manufactured bulk of which is supplied to
company.
OPPORTUNITIES AND THREATS:
The opportunities for growth in all segments remain positive and buoyant. The overall
growth rate of the economy was around 8.7% in 2007-08. The industrial sector
growth has moderated slightly from 10.9% in 2006-07 to about 9% in 2007-08
while service sector growth continued to be robust at around 10%. The
agricultural sector has grown by about 2.6% in 2007-08. The business segments
of Mining & Construction Equipment and Rail & Metro are high growth
areas. Both Mining & Construction equipments have potential to grow with
the demand for these equipments growing with mining and construction segment
recording growth consistently. The Rail & Metro segment is also poised to
grow rapidly with the introduction of new trains for passengers as well as
goods movement and several metros opting for metro rail transit system. In the
Defence segment also business opportunities are growing with the budgetary
allocation for ground support equipment being consistent and offset business
opportunities presenting itself for incremental growth. These factors augur
well for the country which in turn translates into business opportunities in
all spheres for the company since the company serves the core sectors of
economy. The company has set for itself a sales target of Rs.31000.000 Millions
for 2008-09 (MoU Excellent) and is currently holding orders worth Rs.39530.000
Millions approximately. Barring unforeseen circumstances the company is
confident of meeting the target with matching returns.
OUTLOOK:
Metro transport is planned to be introduced in all cities in India having
population of more than 3 million. With this, the estimated requirement for
metro coaches in coming years is expected to be substantial. The company was
the first to introduce manufacture of metro coaches in India. These coaches
have been supplied to M/s DMRC. A new metro fabrication hangar is to come up at
the company's Bangalore unit for manufacturing metro cars with higher level of
indigenization. The company is also in the process of setting up an independent
R&D Centre of Excellence for metro rail systems and related hi-tech products
at Bangalore. With these steps the company stands at an advantage in exploiting
business opportunities that will present itself in future. Introduction of new
trains bringing several places within the railway network indicates the demand
for coaches and wagons to grow steadily. The company bagged an order valued at
Rs.13360.000 Millions for supply of 192 nos. state-of-the-art stainless steel
metro cars to M/s Delhi Metro Rail Corporation which will be the platform for
future growth as an established source of domestic supplier for a world class
product for other metros.
Railcoach Unit II has become fully operational during the year and has started
rolling out Rail coach shells from KGF as a feeder unit to Bangalore Complex.
This new plant has not only added capacity through parts and aggregates to
railcoach production, but also has become the most cost effective source for
components and structures for all rolling stock including wagons.
Construction and mining sector is one of the key growth sectors of the economy.
Infrastructure plays a key role towards pushing India's GDP to the desirable
level of 8% which will aid the construction industry. The company is well
positioned in its product profile for construction and mining equipments
catering to the largest to the smallest equipment in the segment covering
virtually the entire market requirement with wide and strategically positioned
after-sales-service network all of which augurs well for the company. The
estimated demand for earthmoving & construction equipment in the domestic
market for the period from 2007-2015 is estimated to be of order of US$ 40
billion of which Road Building will require US$ 8 billion, Construction
activity and Mining US$ 5 billion, Irrigation US$ 8 billion. The company is already
a key supplier of mining and irrigation and core manufacturing sectors like
steel and cement plants. The focus is now to increase the presence in the
construction segment for which equipments have been developed for construction
specific usage and dealers have been appointed to ensure adequate support for
marketing and after-sales-service.
The Defence segment largely depends upon the budgetary allocation made by the
Government for its procurement. The company is established source of supply of
ground support equipment for varied application in the defence. The company
holds comfortable order book position for defence equipment and with budgetary
outlay rising the outlook in this segment is promising.
TRADE REFERENCE:
- ACE Techno Fabs
- Aditya Cast
- Ambika Engineering Works
- AB Engineering Works
- Anand Arc Electrodes Private Limited
- Anand Industries
- Ananda Fabrications
- Andra Sinter Limited
- Arun Engineering Works
- Baba Mechnical Industries
- Boving Fouress Limited
- Balaji Engineers
- Bhagavan Baba Industries
- Chamundi Engineering Enterprises
- Circlips India
- CK Engineering
- Cresscent Tool Engineering
- Coussinet Engineers
- Diesel [India]
- Easan Engineering Company Limited
- Ganesh Engineering
- Hiten Fasteners Private Limited
- Jaybee Engineering Works
- Kavitha and Kavitha Engineering Company
- Fitwel Fasteners
- INSAP Industries Private Limited
- Laxmi Fab
- Manjil Industries
- Nagabhushanam Enterprises
- P S I Hydraulics
- Rochi Engineers
- Seema Industries
- SGK Industries
- Shabari Engineering
- Shakambari Industries
- Rass Metal Finisher
- Satish Industries
- Talab Engineering Company
- Utility Enterprises
- Vettakatte Industries
- Weldon Industries
- YNR Industries
Fixed Assets:
- Land-Freehold
- Land-Leasehold
- Roads and Drains
- Water Supply Installations
- Buildings
- Railways Sidings
- Plant, Machinery and Equipment
- Electrical Installations
- Office, Furniture and Equipment
- Transport Vehicles.
WEBSITE DETAILS:
Profile
Company (formerly Bharat Earth Movers Limited) was
established in May 1964 as a Public Sector Undertaking for manufacture of Rail
Coaches & Spare Parts and Mining Equipment at its Bangalore Complex. The
Company ha s partially disinvested and presently Government of India owns 54
percent of total equity and rest 46 percent is held by Public, Financial
institutions, Foreign Institutional Investors, Banks and Employees.
During the financial year 2007-08, company achieved a sales
turnover of INR 27130.000 Millions and a pre tax profit of INR 3480.000
Millions. The export earnings touched INR 2006.200 Millions.
Subject (BEML) conferred with Mini-Ratna Status and under
the administrative control of Ministry of Defence, is a multi-technology
company offering high-quality products for diverse sectors of economy such as
coal, mining, steel, limestone, power, irrigation, construction, road building,
aviation, defence, metro and railways. Company is ranked as "The Largest
and Most Profitable Construction Equipment Company" by Construction World
- NICMAR, 2007. It has emerged in the forefront of heavy engineering industry
with a track record of growth and revenues for over four decades. For its
innovative management practices the company has been awarded the "Golden
Peacock Innovation Management Award". Company has also been rated as
"The Fourth Largest Wealth Creator in the Country" by Dalal Street
Magazine. In keeping with the global technology trends, the company is setting
up R&D Centre of Excellence for Research in Metro Rail System in Bangalore.
The main manufacturing facilities are located at Kolar Gold
Fields, Mysore and Bangalore. These incorporate sophisticated facilities like
CNC machines, hi-tech welding equipment and flexible manufacturing systems to
turn out cutting-edge technology products. All three manufacturing facilities
are certified for ISO 9001-2000.
Company operates on three major business verticals for
associated equipment manufacturing
- Mining & Construction
- Defence
- Rail & Metro
In addition to the above there are three services verticals
- Technology Division for providing end-to-end engineering solutions
- Trading Division for dealing in non-company products
- International Business Division for export activities
BEML
has eight manufacturing units spread over four locations
Kolar Gold Fields (KGF) Complex (around 100 Km from
Bangalore)
- Earth Moving Division
- Rail Coach Unit II
- Heavy Fabrication Unit
- Hydraulic & Powerline Division
Mysore Complex (around 130 Km from Bangalore)
- Truck Division
- Engine Division
-
Bangalore Complex - Rail & Metro Division
Vignyan Industries, Tarikere (around 300 km from Bangalore)
- Steel Castings
Company’s nationwide network of sales offices enables buyers
with ready access to its wide range of products. Also, the full-fledged service
centers and parts depots offer total equipment care, maintenance contracts and
rehabilitation services.
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.48.68 |
|
UK Pound |
1 |
Rs.84.37 |
|
Euro |
1 |
Rs.65.70 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
9 |
|
PAID-UP CAPITAL |
1~10 |
9 |
|
OPERATING SCALE |
1~10 |
9 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
10 |
|
--PROFITABILIRY |
1~10 |
8 |
|
--LIQUIDITY |
1~10 |
9 |
|
--LEVERAGE |
1~10 |
9 |
|
--RESERVES |
1~10 |
9 |
|
--CREDIT LINES |
1~10 |
9 |
|
--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 |
|
81 |
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 |
|