MIRA
INFORM REPORT
|
Report Date : |
23.10.2008 |
IDENTIFICATION DETAILS
|
Name : |
SUPERHOUSE LIMITED |
|
|
|
|
Formerly Known As : |
SUPERHOUSE LEATHERS LIMITED |
|
|
|
|
Registered Office : |
|
|
|
|
|
Country : |
|
|
|
|
|
Financials (as on) : |
31.03.2007 |
|
|
|
|
Date of Incorporation : |
14.01.1980 |
|
|
|
|
Com. Reg. No.: |
004910 |
|
|
|
|
CIN No.: [Company
Identification No.] |
L24231UP1980PLC004910 |
|
|
|
|
TAN No.: [Tax
Deduction & Collection Account No.] |
KNPS01554A |
|
|
|
|
Legal Form : |
A Public Limited Liability Company. The Company’s Shares are Listed on the Stock Exchanges. |
|
|
|
|
Line of Business : |
Manufacture and Exports of Shoe Uppers, Chrome Leather, Sole Leather, Shoes, Sole/Cut Soles, Leather Garment, Textile Garments and Leather Goods. |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
Maximum Credit Limit : |
USD 4702390 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a well-established and reputed company having fine
track. The company is progressing
well. Directors are reported as experienced and respectable businessmen. Trade relations are reported as fair. Payments are usually correct and as per
commitments. Fundamentals are strong and healthy. The company can be considered normal for business dealings at usual
trade terms and conditions. The company can be regarded as a promising business partner in a medium
to long -run |
LOCATIONS
|
Registered Office : |
|
|
Tel. No.: |
91-512-2351120 / 2351867 / 2450391 / 2450373 / 2450396 / 2450398 / 2463373 / 2461391 |
|
Fax No.: |
91-512-2450814 / 2820325 / 2451124 / 2460814 |
|
E-Mail : |
|
|
Website : |
|
|
|
|
|
Plants: |
Leather Processing A-1 Site-ll, Industrial Area, Unnao - 209 801 B-15, U.PS.I.D.C. Industrial Area, Site-ll, Unnao-209 801 Fashion Footwear Plot No. A-3, A-5, .RS.I.D.C.Industrial Area, Site-B, Sikandra, Agra-282 007 D-15, U.PS.I.D.C. Industrial Area, Site-ll, Unnao-209 801 Safety Footwear B-6, Site I, Industrial Area, Unnao-209 801 Shoe Upper Textile Garment A-14, Sector 65, Phase III, Noida Leather Garment C-10, Sector 58, Phase III, Noida |
|
|
|
|
Division Offices: |
Upper Division 102/88 - A (10) Wazidpur, Tel: 91-515 - 2460496,2463373,2461391 Fax: 91-515 - 2460814,2462124 Chrome Tannery Division A-1 C-1 Industrial Area, Site-II, Unnao – 209801 Tel: 91-515 - 2829750, 2829850 Fax: 91-515 - 2829325, 2829190 Goat Tannery B-15,16 and 17, Industrial Area, Site, Unnao – 209801 Tel: 91-515 - 2829845, 2829812, 2829248 Fax: 91-515 - 2829658, 2829190 Harness and Sole Tannery B-16 and 17, Site II Industrial Area, Unnao - 209801 Tel.: 91-515 - 282845, 2829812, 2829248, 2829658 Fax.: 91-515 - 2829190 Shoe Division D-15/B, UPSIDC, Industria Area, Phase-II, Unnao – 209801 Tel: 91-515 - 2829452, 2829923, 2829657, 2829037 Fax: 91-515 - 2829325, 2829190 Safety Footwear Division B-6, Site-I UPSIDC, Industrial Area Unnao – 209801 Tel: 91-515 - 2829656, 2829384, 2829675, 2829803 Fax: 91-515 - 2829325, 2829190 Fashion Shoe Division I Plot No. A-3, A-4, B-4, B-5, B-6 Shastri Puram, Tel: 91-562 - 26423352, 2640183, 2642336 Fax: 91-562 – 2640184 Fashion Shoe Division II A-5, UPSIDC, Industrial Rea, Site-B, Sikandra, Tel: 91-562 – 2642336 Leather Garments Division B-37, Sector - 59 Phase-II, Noida Tel: 91-120 - 2584819, 2585819 Fax: 91-120 – 2584976 Textile Garments Division C-10, Sector-58 Phase-II Noida Tel: 91-120 - 2580095,2490630 Fax: 91-120 – 2580095 Marketing Office, Marketing Office, Noida C-10, Sector-58, Phase-II, Noida Tel: 91-120 - 2580095,2490630 Fax: 91-120 – 2580095 Marketing Office, Chennai 42/1/II, Ekkathuthqngal Channai – 600097 Telfax: 91-44 – 22253731 Super Footwear Limited Shed No.1, Leather Complex, Site-II, Industrial Area, Unnao – 209801 Fax: 91-515 - 2829325,2829190 Superhouse Shoes Limited E-54, UPSIDC, Industrial Area, Phase-II, Unnao Tel: 91-515 – 2829289 Amin International Limited E-55, UPSIDC, Industrial Area Phase-II Unnao Tel: 91-515 - 2829704 |
|
|
|
|
Overseas
Offices: |
Amin International Limited E-55, UPSIDC, Industrial Area Phase-II Unnao Tel: 0515 – 2829704 US Office Colonial Crest Apartment, 1090-F, Telefax: 1-610 9663351 E-mail: usoffice@superhousegroup.com 4/14, Avenue Road, Frewville SA5063, Tel No. : 61-8-8338 2454, Fax : 61-8-8338 2283 E-mail: superhouse@optusnet.com.au UAE Office Warehouse No. B-4, Tel No : 971-6-7442993, Fax : 971-6-7443739 E-mail: uaeoffice@superhousegroup.com |
DIRECTORS
|
Name : |
Mr. Mukhtarul Amin |
|
Designation : |
Chairman cum
Managing Director |
|
Date of Birth/Age : |
48 years |
|
Qualification : |
B.Sc. |
|
Experience : |
29 years |
|
Date of Appointment : |
01.11.1990 |
|
Previous Employment: |
Super Tannery
India Limited, Managing Director |
|
|
|
|
Name : |
Mrs. Shahina Mukhtar |
|
Designation : |
Wholetime Director |
|
|
|
|
Name : |
Mr. Vinay Sanan |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. Anil Kumar Agarwal |
|
Designation : |
Director Finance |
|
|
|
|
Name : |
Mr. Mohd. Shadab |
|
Designation : |
Wholetime Director |
|
|
|
|
Name : |
Mr. Zafarul Amin |
|
Designation : |
Wholetime Director |
|
|
|
|
Name : |
Mr. Salman Khurshid |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Anil Soni |
|
Designation : |
Director |
|
|
|
|
Name : |
Dr. K. K. Agarwal |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. M. D. Dalai |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. S. M. Rais |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Sartaj Ahmad |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Rizwan Ahmad Khan |
|
Designation : |
Wholetime Director |
|
|
|
|
Name : |
Mrs. Nausheen Shadab |
|
Designation : |
Director |
|
|
|
|
Name : |
Mrs. Shada Fatima |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Kamal Agarwal |
|
Designation : |
Director |
KEY EXECUTIVES
|
Name : |
Mr. R. K. Agrawal |
|
Designation : |
Company Secretary |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
AS ON 31.03.2007
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
|
|
A. Promoter's Holding (1+2) |
3806678 |
41.83 |
|
|
1 |
Promoters |
|
|
|
|
Indian promoters |
3806678 |
41.83 |
|
|
Foreign Promoters |
- |
- |
|
2 |
Persons acting in Concert |
- |
- |
|
Sub-Total |
3806678 |
41.83 |
|
|
B. Non-Promoters Holding (3+4) |
|
|
|
|
3 |
Institutional Investors |
5293322 |
58.17 |
|
a. |
Mutual Funds and UTI |
4338 |
0.05 |
|
b. |
Banks, Financial Institutions, Insurance Companies (Central / State
Government Institutions / Non-Government Institutions) |
5475 |
0.06 |
|
c. |
Flls |
- |
- |
|
Sub-Total |
9813 |
0.11 |
|
|
4. |
Others |
|
|
|
a. |
Private Corporate Bodies |
525846 |
5.78 |
|
b. |
Indian Public |
4748370 |
52.18 |
|
c. |
NRIs / OCBs |
9293 |
0.10 |
|
Sub-Total |
5283509 |
58.06 |
|
|
GRAND TOTAL |
9100000 |
100.00 |
|
BUSINESS DETAILS
|
Line of Business : |
Manufacture and Exports of Shoe Uppers, Chrome Leather, Sole Leather, Shoes, Sole / Cut Soles, Leather Garment, Textile Garments and Leather Goods. |
||||||||
|
|
|
||||||||
|
Products : |
|
||||||||
|
|
|
||||||||
|
Exports : |
v
v
v
v
v
v HongKong v
v
v
v
v
v
v
v
v
v
v
v
|
PRODUCTION STATUS
|
Class of Goods |
Unit |
Capacity (per Annum) |
Actual
Production |
|
|
Licensed |
Installed |
|||
|
Shoe Upper |
Pairs |
1000000 |
912000 |
386978 |
|
Leather Hides |
Hides |
Delicenced |
450000 |
450457 |
|
Leather skin |
Pcs |
Delicenced |
1000000 |
1207323 |
|
Shoes |
Pairs |
2629200 |
1615301 |
2380348 |
|
Leather Products |
Pcs |
543000 |
N. A. |
57481 |
|
Textile Garment |
Pcs |
750000 |
210000 |
444848 |
|
Sole |
Pairs |
N.A. |
480000 |
155055 |
GENERAL INFORMATION
|
Suppliers : |
v Avadh Engines and Machines Private Limited v Kurt’O John Shoe Components Private Limited v M I Rubber Industries v R.K. Traders v Sanghavi Shoe Accessories Private Limited v AKI Leather Industries Private Limited v Associated Chemicals Private Limited v Associated Chemicals Private Limited v Anu Chemicals v K.N. Chemicals v Keuper Laminators v
Pee v Roshan Lai |
||||||||||||||
|
|
|
||||||||||||||
|
Customers : |
v Shoe House v Prime
International |
||||||||||||||
|
|
|
||||||||||||||
|
No. of Employees : |
1240 |
||||||||||||||
|
|
|
||||||||||||||
|
Bankers : |
v
Punjab National Bank, Tel. No. 91-512-2317986 / 2362117 / 2311577 Fax No. 91-512-2311232 v
State Bank of 15/54-B, Civil Court Road, Civil Lines, Tel. No. 91-512-2354990 / 2368174 Fax No. 91-512-2313474 |
||||||||||||||
|
|
|
||||||||||||||
|
Facilities : |
Of the above
Term loans worth Rs. 67.210 millions (Previous year Rs. 56.082 millions) are
repayable within one year. Working Capital Loans
from banks include USD nIL (Previous Year USD 7,00,000) Foreign Currency
Demand Loan Secured by
hypothecation of specific current assets and movable assets of the Company
both present and future and personal guarantee of two directors and includes
Rs. Nil (Previous year- Rs. 1.657 millions) secured by documentary bills. Secured by
equitable mortgage of specific fixed assets and hypothecation of Plant and
Machineries and personal guarantee of two directors and includes Rs. 9.798
millions (Previous year Rs. 9.941 millions) secured by hypothecation of
specific assets. Secured by
equitable mortgage of specific Land and Building and hypothecation of
specific Fixed Assets and personal guarantee of two directors. |
|
|
|
|
Banking
Relations : |
Good |
|
|
|
|
Auditors : |
|
|
Name : |
Kapoor Tandon and Company Chartered Accountants |
|
Address : |
|
|
|
|
|
Associates/Subsidiaries : |
Subsidiaries v Amin International Limited v
Superhouse ( v
Superhouse ( v
Superhouse
Australia Pty. Limited, ASSOCIATES v
Super Tannery ( v Superhouse Overseas Limited v Superhouse Shoes Limited v Chowdhary Overseas Limited v Unnao Tanneries Pollution Control Company v Super Footwear Limited v Tritan Leather Works Private Limited v Prime International v Shoe House v Nigar Talkies Limited |
CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
15000000 |
Equity Shares |
Rs. 10.00 each |
Rs. 150.000
millions |
Issued, Subscribed Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
13047718 |
Equity Shares |
Rs. 10.00 each |
Rs. 130.477 millions |
Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
9100000 |
Equity Shares |
Rs. 10.00 each |
Rs. 91.000 millions |
|
3947718 |
Add: forfeited Equity Shares |
|
Rs. 3.948 millions |
|
|
Total |
|
Rs. 94.948 millions |
Note:
Of the above 4214542 Equity shares were allotted as fully paid Share pursuant to the Scheme of Amalgamation without payments being received in cash.
810135 Shares allotted as fully paid shares during the year on conversion of 606718 preferential warrants.
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
94.948 |
92.191 |
82.881 |
|
|
2] Preferential Warrant Money |
26.908 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
818.622 |
767.491 |
717.240 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
940.478 |
859.682 |
800.121 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
760.368 |
539.380 |
509.556 |
|
|
2] Unsecured Loans |
0.000 |
0.000 |
0.000 |
|
|
TOTAL BORROWING |
760.368 |
539.380 |
509.556 |
|
|
DEFERRED TAX LIABILITIES |
74.523 |
70.623 |
69.455 |
|
|
|
|
|
|
|
|
TOTAL |
1775.369 |
1469.685 |
1379.132 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
752.534 |
628.992 |
595.554 |
|
|
Capital work-in-progress |
22.165 |
32.422 |
26.159 |
|
|
Advances for Capital Expenditure |
29.650 |
12.540 |
4.316 |
|
|
|
|
|
|
|
|
INVESTMENT |
45.559 |
52.657 |
50.599 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
773.719
|
584.959
|
491.959 |
|
|
Sundry Debtors |
590.369
|
468.047
|
453.676 |
|
|
Cash & Bank Balances |
126.020
|
50.100
|
59.191 |
|
|
Other Current Assets |
72.542
|
50.661
|
47.501 |
|
|
Loans & Advances |
77.690
|
55.050
|
53.891 |
|
Total
Current Assets |
1640.340
|
1208.817 |
1106.218 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
706.885
|
449.381
|
399.280 |
|
|
Provisions |
7.994
|
16.362
|
4.528 |
|
Total
Current Liabilities |
714.879
|
465.743 |
403.808 |
|
|
Net Current Assets |
925.461
|
743.074 |
702.410 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.094 |
|
|
|
|
|
|
|
|
TOTAL |
1775.369 |
1469.685 |
1379.132 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
|
Sales Turnover |
3246.033 |
2309.910 |
2207.546 |
|
|
Other Income |
24.222 |
10.228 |
16.075 |
|
|
Change in stock of Finished Goods and
work-in-process |
74.926 |
58.090 |
(12.738) |
|
|
Total Income |
3345.181 |
2378.228 |
2210.883 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
110.607 |
78.599 |
79.382 |
|
|
Provision for Taxation |
39.942 |
31.168 |
22.364 |
|
|
Profit/(Loss) After Tax |
70.665 |
47.431 |
57.018 |
|
|
|
|
|
|
|
|
Earnings in Foreign Currency : |
|
|
|
|
|
|
Export Earnings |
2457.211 |
1784.2354 |
1651.372 |
|
|
Other Earnings |
1.166 |
0.223 |
0.904 |
|
Total Earnings |
2458.377 |
1784.458 |
1652.276 |
|
|
|
|
|
|
|
|
Imports : |
|
|
|
|
|
|
Raw Materials |
188.113 |
91.587 |
101.706 |
|
|
Stores & Spares |
187.725 |
149.875 |
149.407 |
|
|
Capital Goods |
24.103 |
20.430 |
24.970 |
|
|
Finished Goods |
0.142 |
0.456 |
0.000 |
|
Total Imports |
400.083 |
262.348 |
276.083 |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Materials consumed |
2354.096 |
1615.733 |
1515.912 |
|
|
Manufacturing, Administrative,
selling and Distribution Expenses |
821.259 |
635.413 |
571.853 |
|
|
Depreciation |
59.219 |
48.483 |
43.736 |
|
Total Expenditure |
3234.574 |
2299.629 |
2131.501 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2007 |
30.09.2007 |
31.12.2007 |
31.03.2008 |
|
Type |
(1st Quarter) |
(2nd Quarter) |
(3rd Quarter) |
(4th Quarter) |
|
Sales Turnover |
714.600 |
889.300 |
706.500 |
950.300 |
|
Other Income |
2.900 |
5.300 |
2.200 |
0.000 |
|
Total Income |
717.500 |
894.600 |
708.700 |
950.300 |
|
Total Expenditure |
680.900 |
850.400 |
665.000 |
896.800 |
|
Operating Profit |
36.600 |
44.200 |
43.700 |
53.500 |
|
Interest |
16.700 |
19.500 |
18.400 |
13.300 |
|
Gross Profit |
19.900 |
24.700 |
25.300 |
40.200 |
|
Depreciation |
15.200 |
18.400 |
17.900 |
16.400 |
|
Tax |
1.600 |
3.800 |
5.500 |
15.000 |
|
Reported PAT |
1.800 |
2.600 |
2.300 |
7.900 |
KEY RATIOS
|
PARTICULARS |
31.03.2007 |
31.03.2006 |
31.03.2005 |
|
Debt-Equity Ratio |
0.80 |
0.70
|
0.72 |
|
Long Term Debt-Equity Ratio |
0.23 |
0.21
|
0.19 |
|
Current Ratio |
1.23 |
1.31
|
1.27 |
|
TURNOVER RATIO |
|
|
|
|
Fixed Assets |
2.67 |
2.27
|
2.26 |
|
Inventory |
4.10 |
3.75
|
3.76 |
|
Debtors |
5.26 |
4.38
|
4.41 |
|
Interest cover Ratio |
2.61 |
2.52
|
2.62 |
|
Operating Profit Margin(%) |
8.57 |
8.85
|
9.27 |
|
Profit Before Interest and Tax Margin(%) |
6.44 |
6.45
|
6.91 |
|
Cash Profit Margin(%) |
4.67 |
4.75
|
5.43 |
|
Adjusted Net Profit Margin(%) |
2.54 |
2.35
|
3.07 |
|
Return on Capital Employed(%) |
12.30 |
10.26
|
10.92 |
|
Return on Net Worth(%) |
8.75 |
6.37
|
8.33 |
LOCAL AGENCY FURTHER INFORMATION
Financial
Performance:
The company has achieved the sales and other Income of Rs. 3270.255 Millions against Rs. 2320.138 Millions reported last year. The Profit after Tax was Rs.70.665 Millions during the year as compared to Rs.47.431 Millions reported during the previous year.
Recognition:
Council for Leather Exports:
Mr. Mukhtarul Amin, Chairman and Managing Director of the company has
been unanimously elected as Chairman of Council for Leather Exports, a body
functioning under Ministry of Commerce and Industries, Government of India, for
the period 2007-2009.
Gold Trophy:
The company has once again bagged the most prestigious Golden Peacock Award for
the best performance in Overall Export in leather industry. The companies with
total FOB export turnover of leather and leather products of Rs. 1000.000
Millions and above are eligible for considering this award. In addition to Gold
Trophy, the company has also claimed five other outstanding awards for Brand
Promotion, Export of non-leather harness and saddlery, maintaining high
standard for environment production and adhering to International Standard of
quality, health and safety.
Amalgamation with Super Footwear Limited
and Allen Shoes Limited:
M/s Super Footwear Limited and M/s Allen Shoes Limited have been
amalgamated with the company during the year. The combined financial and other
resources of all the three companies have resulted in better and more
profitable utilization of these sources and the company has been better placed
for further profitable growth.
MANAGEMENT DISCUSSION
AND ANALYSIS
Macroeconomic Overview:
Vigorous growth with strong macroeconomic fundamentals has characterized
developments in the Indian economy in 2006-07 so far. However, there are some
genuine concerns on the inflation front. Growth of 9.0 per cent and 9.2 per
cent in 2005-06 and 2006-07, respectively, by most accounts, surpassed
expectations. While the up-and-down pattern in agriculture continued with
growth estimated at 6.0 per cent and 2.7 per cent in the two recent years, and
services maintained its vigorous growth performance.
Entrenchment of the higher growth trends, particularly in manufacturing, has boosted sentiments, both within the country and abroad. The overall macroeconomic fundamentals are robust, particularly with tangible progress towards fiscal consolidation and a strong balance of payments position.
There were distinct signs of sustained improvements on the industrial front. Growth of industrial sector, from a low of 2.7 per cent in 2001-02, revived to 7.1 per cent and 7.4 per cent in 2002-03 and 2003-04, respectively, and after accelerating to over 9.5 per cent in the next two years, touched 10.0 per cent in 2006-07.
A notable feature of the current growth phase is the sharp rise in the rate of
investment in the economy. Investment, in general being a forward looking
variable, reflects a high degree of business optimism. The revival in gross
domestic capital formation (GDCF) that commenced in 2002-03 has been followed
by a sharp rise in the rate of investment in the economy for four consecutive
years. This sharp increase in the investment rate has sustained the industrial
performance and reinforces the outlook for growth.
During 2006-07, after a slow start, exports gained momentum to grow by an estimated 36.3 per cent in the first nine months to reach US$89.5 billion.
Buoyancy of exports was driven by the resurgence in the manufacturing sector and sustained demand from major trading partners.
Industry Structure and Developments:
The leather industry is spread in different segments, namely, Finished Leather Footwear,
Footwear Components, Leather Garments and Leather Goods including Bags,
Saddlery, Harness and Leather Gloves etc. The major production centers for
leather and leather products are located at Chennai, Ambur, Ranipat,
Vaniyambadi, Trichi and Dindigul in Tamilnadu, Kolkata in West Bangal,
Punjab,
The composition of export of leather and leather products from
Realizing the growth potential of the leather industry, the Government of India has been making significant efforts to promote rapid advancement of the industry. On june 30, 2005, the Cabinet Committee on Economic Affairs (CCEA) decided to implement a Rs. 2.9 billion scheme for the integrated development of the leather sector. Under this scheme, existing tanneries are being modernized and new units are being set up for footwear, components and leather products. This scheme is resulting in gains in terms of productivity, right-sizing of capacity, cost-cutting, and design-development.
Opportunities and Threats:
Council for Leather Exports introduced a vision document for 2010-11 which was presented to Hon'ble Minister of State, Commerce and Industry, Govt. of India with the object to analyze the growth pattern of leather exports and formulate intervention strategies with and object to enhance the exports to $ 7 Billion by 2010-11 from the present export at USD 2.39 Billion by creating additional one million jobs in the sector. Council estimated 42% of value as additional exports is required to meet the target of USD 7 Billion. To achieve the target, major growth is required in Footwear i.e.
25%, Finished Leather i.e. 14%, Garments i.e. 12% and Leather Goods i.e.
18%. Council has also estimated requirement of finished leather is 4 Billion Sq. ft. out of 2 Billion Sq. Ft. is available at present for achieving the USD 7 Billion export target.
Performance
Overview:
Subject is one of the leading leather exporters with certification from
Government of India. The company has 12 units spread across
The Company also has made its foray into the Indian retail sector and owns the
retail brand in the name of Allen Cooper with exclusive stores at
The company is one of the major suppliers to GAP, DKNY, Miss
Sixty, Dolcis, C&A, Next PLC, Liz, Steve Maidden, Euro Shoes, Spapino,
Burton's, Andre, Heckel Security, Kramer Pferdesport, Hooks, J.D. Williams,
Cipesz ES, Cofra SRL, Heba, M-Tech, PT Alasmas Berkat, Punto FA, and Tesco. The
company is among the largest footwear exporters from the country to
The company is committed to produce quality products for its customers and has
acquired IS09001-2000, ISO-14001-2004 & OHSAS-18001-1999 certification.
It also has the distinction of quality certification under
British,
Today Superhouse, is major exporter to European countries including
During FY07, the company recorded total consolidated revenue of Rs 3337.300
Millions, an increase of 42% y-o-y. The consolidated net profit increased 57%
y-o-y to Rs 77.100 Millions. There was a slight dip in the operating margin to
6.83% from 7.13% on account of depreciation of rupee towards the end of fiscal.
The EPS for the year was Rs 8.67 as against Rs 6.21 at the end of FY06.
Business:
Subject has plans to ramp up its capacity, both by organic and inorganic
routes. For this, they are setting up two new shoe factories with a capacity of
5,000 pairs a day at
Handling Industry Issues:
The company is dealing with the issue of appreciation of rupee towards the end
of FY07 by reducing wastage and overhead expenses. The appreciation will affect
only the orders booked before rupee appreciation. Moreover, the government has
now increased the drawback/DEPB and lowered interest rates on exports, which
will make the scenario better for the industry and the company.
Industry Outlook:
During 2006-07 the leather industry has registered very impressive growth of
21.33% as against previous year growth of 7.98%. The trend of positive growth
is continuing during the current year. The company has demand of its products
from all over the world. The company has achieved export growth rate of 37.72%
and thereby surpassing the industry growth rate of 21.33% during 2006-07. It is
expected that the company will maintain the growth rate during 2007-08.
Risk and Concerns:
The major raw material for leather industry is raw hide/skins. Leather is a
natural product and its prices and availability are changing from time to time.
The company is having vast experience in sourcing the raw materials for its
tanneries and leather products divisions from
Cautionary Statement:
Statement in the Management Discussion and Analysis describing the
Company's objectives, projections, estimates, expectation or prediction may be
`forward-looking statement' within the meaning of applicable securities laws
and regulations. Further, the performance of the company is also dependent on
domestic and global economic conditions, government and regulatory policies on
which company is not having any control.
Internal Control System and their
Adequacy:
The company has a proper and adequate system of internal controls to ensure
that all assets are safeguarded and protected against loss from misuse or
disposition and that transactions are authorized, recorded and reported
correctly. Proper checks and controls have been introduced for all the incoming
and outgoing materials. The Audit Committee and Internal Audit Department
regularly review the financial and operating controls at all location of the
Company. The internal control is designed to ensure that the financial and
other records are reliable for preparing financial statements and other data,
and for maintaining accountability of assets.
Financial Performance with Respect to
Operational Performance:
The financial statements have been prepared in compliance with the requirements
of the companies Act, 1956 and Generally Accepted Accounting Principals in
|
Contingent
Liabilities |
31.03.2007 (Rs. In millions) |
|
Guarantees issued by the Bank |
5.626 |
|
Corporate Guarantee(s) to bank(s) against credit facilities extended
to wholly owned subsidiary in U.K and UAE and a Society |
111.143 |
|
Letter of Credit opened and outstanding |
246.237 |
|
Duty on Export obligation pending |
106.846 |
|
Electricity demand pending litigation |
1.214 |
|
Uncalled Liability on Shares partly paid |
4.000 |
In accordance with the Scheme, the entire business and all the properties and assets, entitlements, duties, liabilities and obligation of every kind, nature and description of SFL and ASL stands transferred and vested in the company i.e. SHL. Pursuant to the Scheme, in consideration of the said transfer and after considering the extinguishment of share capital held by SHLin SFL, theSHLhas issued 392 (three hundred ninety two) fully paid up Equity Share of Rs. 10 each of SHL against 100 (one hundred) fully paid up Equity Shares of Rs. 100 each ofSFLand240 (two hundred forty) fully paid up Equity Share of Rs. 10 each of SHL against 100 (one hundred) fully paid up Equity Shares of Rs. 10 each of ASL. Accordingly 396,483 Equity Shares were alloted as fully paid up during the year without the payment being received in cash.
Fixed Assets:
v
Land
v
Building
v
Plant and machinery
v
Furniture and Fittings
v
Vehicles
v
Computer
Website details attached
Introduction
From
a single tannery in the 80’s producing finished leather, Subject has emerged as
one of the biggest players in the industry. It started with a commitment to
excel, achieve and deliver the very best. Here, they engineer, optimize and
control every phase of manufacturing process from raw material to finished products
to ensure that end products are of highest quality and also best value for
money.
A
US $50 million group, subject has 15 units, with workforce of over 3000 and has
its presence in over 35 countries. Their commitment to quality is approved by ISO
9002 certification. Stringent norms of EN 345 make them one of the most
respected manufacturers amongst the importers from European countries. Being
equipped with requisite infrastructure and strict adherence to high standard of
quality, they are able meet CSA, ANZ & SABS standard.
A
perfect blend of highly technical, skilled & semi-skilled work force and
competent executives has helped them in carving an enviable position for
theirselves in the global market.
Three
state-of-art units involved in manufacturing of footwear are ably backed by
their marketing offices strategically located in
To
add on, they are approved vendors to world-wide brands such as Wal-mart,
Filanto, Auchan, Andre, Shoe Fayre,
Their
existence in the trade for over three decades has given them a wealth of
knowledge, which allows them to offer their customers the maximum in choice,
value & quality.
It’s their in-house tanneries sole division provide them with
finest quality leather Soles for their foot wears. To meet the exacting demand
of clients they also import leather from
Honours and Awards
The Company has the distinguished Awards. All having been awarded scores of Performance Awards, some of which are listed below :
Export Award from Council
for Leather Exports for creditable export performance during
year 2004-2005 under the category Saddlery & Harness (Above US$1
million) - Plaque.
RajyaNiryat Puraskar Trophy ( First Position ) 1988-89 Medium size Industry by Government of Uttar Pradesh.
RajyaNiryat Puraskar Trophy ( Second Position ) 1990-91 Medium size Industry by Government of Uttar Pradesh.
RajayaNiryat Puraskar Trophy ( First Position } 1991-92 Medium size Industry by Government of Uttar Pradesh.
RajyaNiryat Puraskar Trophy ( Second Position ) 1995-96 Medium size Industry by Government of Uttar Pradesh.
Small Industries of Export Promotion Department, Government of Uttar Pradesh Trophy ( Second Prize ) for commendable performance in Exports in 1995-96.
Letter of Appreciation, International Shoe Fare, 1996.
Certificate of Merit awarded by C.L.E. Chennai, for commendable performance in Exports in 1997-98.
Certificate and Trophy for showing commendable export performance in 1998-99 in leather Footwear.
Certificate and Trophy for showing commendable performance for Footwear components. Certificate and Trophy for showing commendable performance in finished Leather.
C.L.E. Certificate of Merit for commendable performance in exports for US.$ LOO million to 5,00 million in 1998-99.
Certificate and Trophy - Rajya Niryat Puraskar, 1998-99 ( First Prize ) by Government of Uttar Pradesh.
International Institute of Education and Management /International Udyog Excellence Award, 2000.
Life time Achievement Award to Mr. Mukhtarul Amin for outstanding Achievement in achieving Trophy - Certificate and Trophy National and International Compendium July, 2000.
213i Century Millenium Award to Mr. Mukhtarul Amin by International Institute of Education and Management.
C.L.E. Certificate and Trophy for Exports 1.00 million to 5.00 millions US.$ In 1997-98 in Leather Goods.
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners, controlling
shareholders or senior officers as terrorist or terrorist organization or whom
notice had been received that all financial transactions involving their assets
have been blocked or convicted, found guilty or against whom a judgement or
order had been entered in a proceedings for violating money-laundering,
anti-corruption or bribery or international economic or anti-terrorism sanction
laws or whose assets were seized, blocked, frozen or ordered forfeited for
violation of money laundering or international anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper payments
to government officials for engaging in prohibited transactions or with
designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority for
any financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
The market survey
revealed that the amount of compensation sought by the subject is fair and
reasonable and comparable to compensation paid to others for similar services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
The Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws, regulations
or policies that prohibit, restrict or otherwise affect the terms and
conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs. 49.29 |
|
|
1 |
Rs. 80.40 |
|
Euro |
1 |
Rs. 63.35 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
64 |
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/normal. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, they have no basis upon which to
recommend credit dealings |
No Rating |
|