MIRA
INFORM REPORT
|
Report Date : |
31.10.2008 |
IDENTIFICATION DETAILS
|
Name : |
PLETHICO PHARMACEUTICALS LIMITED |
|
|
|
|
Registered Office : |
A.B.Road, Manglia, Indore-452003, Madhya Pradesh |
|
|
|
|
Country : |
|
|
|
|
|
Financials (as on) : |
31.12.2007 |
|
|
|
|
Date of Incorporation : |
04.12.1991 |
|
|
|
|
Com. Reg. No.: |
006801 |
|
|
|
|
CIN No.: [Company
Identification No.] |
L24232MP1991PLC006801 |
|
|
|
|
TAN No.: [Tax
Deduction & Collection Account No.] |
BPLP00659B |
|
|
|
|
Legal Form : |
Public Limited Liability Company. The Company’s Shares are Listed on
Stock Exchange |
|
|
|
|
Line of Business : |
Manufacturer of Ethical Medicine, Medical Disposables, Surgical, Ayurveda and Herbal Formulations. |
RATING & COMMENTS
|
MIRA’s Rating : |
A |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
56-70 |
A |
Financial & operational base are regarded healthy. General unfavourable
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums |
Fairly Large |
|
Maximum Credit Limit : |
USD 29000000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a well established and reputed pharmaceutical
company, controlled and financed by Patel family. Their trade relations are
reported as fair. Financial position of the company is good. Business is active.
Payments are reported as correct and as per commitments.
The company can be considered good for normal business
dealings at usual trade terms. |
LOCATIONS
|
Registered Office/ Factory : |
A.B.Road, Manglia, Indore-452003, Madhya Pradesh, India |
|
Tel. No.: |
91-731-2422881/ 85 |
|
Fax No-: |
91-731. 2420938 |
|
Website : |
|
|
Area : |
Owned |
|
|
|
|
Administrative Office : |
37/37-A, Industrial Estate, Pologround, Indore-452015,
Madhya Pradesh, India |
|
Tel. No.: |
91-731-2422881/6/6 |
|
Fax No.: |
91-731-2420938/2421309 |
|
E-Mail : |
|
|
|
|
|
Corporate Office : |
Shabnam House, Ground Floor, Plot No. A/15, Central Cross Road B,
Behind MIDC Police Chowki, Andheri (East), Mumbai-400093, Maharashtra, India |
|
Tel. No.: |
91-22-66988301/ 66988302 |
|
Fax No.: |
91-22-66988300/ 66988330 |
|
E-Mail : |
|
|
|
|
|
Plethico Exports : |
106, Padma Towers II, 22, Rajendra Place, New Delhi-110008 |
|
Tel. No.: |
91-11-25811701/25810495 |
|
Fax No.: |
91-11-25762410 |
|
E-Mail : |
|
|
|
|
|
Domestic Division : |
41, Navkethan Industrial Estate, Mahakali Caves Road,
Andheri (East) Mumbai-400093, Maharashtra |
|
Tel. No.: |
91-22-28217957/58/28235184 |
|
Fax No.: |
91-22-28204970/28235185 |
|
E-Mail : |
|
|
|
|
|
Factory 1 : |
Village Dharawa, Post Kalaria, Dhar, Madhya Pradesh, India |
|
|
|
|
Factory 2 : |
Shed No. 347/348, A-II Types, Sector IV, Kandla Special Economic Zone,
Gandhidham, Kanchachh-370230, India |
|
|
|
|
Branch Office : |
1st Floor, Crimpage Corporation, Plot No. 57,
Street No. 1, Marol, Andheri (East), Mumbai – 400 093 |
|
Tel. No.: |
56988301 / 02 |
DIRECTORS
|
Name : |
Mr. Shashikant Patel |
|
Designation : |
Chairman cum Managing Director |
|
|
|
|
Name : |
Mr. Chirag Patel |
|
Designation : |
Whole-time Director and Chief Executive Officer |
|
|
|
|
Name : |
Mrs. Gauravi Parikh |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. G N Qazi |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Pramod K Shrivastava |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Abhay Suhane |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Balwant Save |
|
Designation : |
Director |
|
Date of Appointment : |
04.12.1991 |
|
|
|
|
Name : |
Mr. Nikhil Bhai Patel |
|
Designation : |
Director |
|
Date of Appointment: |
04.12.1991 |
|
Date of Ceasing : |
31.03.1995 |
|
|
|
|
Name : |
Mr. Saurabh Parikh |
|
Designation : |
Director |
|
Date of Appointment : |
01.11.2001 |
|
|
|
|
Name : |
Mr. Karim Bhai Patel |
|
Designation : |
Director |
|
Date of Appointment : |
04.12.1991 |
|
|
|
|
Name : |
Mr. Bhaskar Bhai Patel |
|
Designation : |
Chairman |
|
Date of Appointment : |
04.12.1991 |
KEY EXECUTIVES
|
Name : |
Mr. Ashok Mishra |
|
Designation : |
Company Secretary |
|
|
|
|
Operational Planning and Execution Committee ( OPEC) |
Mr. Rajiv Bedi Mr. Hemant Modi Mr. Sanjay Pai Mr. Sharad Kumar Mr. K.R. Krishnan Mr. Manoj Javkar |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 30.09.2005
|
Names of Shareholders |
|
No. of Shares |
|
Bhaskar Bhai Patel |
|
20,72,000 |
|
Nikhil Bhai Patel |
|
17,11,000 |
|
Shashikant Bhai Patel |
|
37,83,000 |
|
Jayshree Patel |
|
8,500 |
|
Chirag Patel |
|
8,500 |
|
Bhaskar Patel |
|
8,500 |
|
Geeta Patel |
|
8,500 |
|
Total |
|
76,00,000 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer of Ethical Medicine, Medical Disposables, Surgical, Ayurveda and Herbal Formulations. |
||||||||
|
|
|
||||||||
|
Products : |
|
GENERAL INFORMATION
|
No. of Employees : |
1100 |
||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||
|
Bankers : |
·
Bank of Baroda, Siyaganj, Indore, Madhya
Pradesh, India ·
State Bank of Indore ·
IDBI Bank Limited ·
Exim Bank Central Bank of India, Siyaganj, Indore, Madhya Pradesh, India |
||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||
|
Facilities : |
|
|
|
|
|
Banking
Relations : |
Good |
|
|
|
|
Auditors : |
|
|
Name : |
N.P. Gabndhi and Company Chartered Accountants |
|
Address: |
105, Esplanade, 144, M. G. Road, Fort, Mumbai,
Maharashtra, India |
|
|
|
|
Cost Auditors: |
|
|
Name : |
Vijay P Joshi and Company Chartered Accountant ( Cost and Works Accountants) |
|
|
|
|
Associates/Subsidiaries : |
·
Plazma Laboratories Private Limited ·
Plethico Laboratories Private Limited ·
Plethico Products ·
Wiscon Pharmaceuticals Private Limited ·
Too Reslov Limited ·
OOO Rezlov Limited ·
Rezlov LSS ·
SC Rezlov ·
CJSC Rezlov |
CAPITAL STRUCTURE
As on 31.12.2007
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
40000000 |
Equity Shares |
Rs. 10/- each |
Rs. 400.000 Millions |
Issued Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
34081767 |
Equity Shares |
Rs. 10/-
each |
Rs. 340.820
Millions |
Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
34066667 |
Equity Shares |
Rs. 10/-
each |
Rs. 340.670
Millions |
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.12.2007 15 Months |
30.09.2006 12 Months |
30.09.2005 12 Months |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
340.670 |
340.670 |
76.000 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
5589.890 |
4097.300 |
2547.400 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
5930.560 |
4437.970 |
2623.400 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
764.860 |
865.440 |
548.400 |
|
|
2] Unsecured Loans |
3060.910 |
80.430 |
129.400 |
|
|
TOTAL BORROWING |
3825.770 |
945.870 |
677.800 |
|
|
DEFERRED TAX LIABILITIES |
119.570 |
101.080 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
9875.900 |
5484.920 |
3301.200 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
1110.330 |
932.760 |
981.200 |
|
|
Capital work-in-progress |
23.990 |
236.090 |
4.400 |
|
|
|
|
|
|
|
|
INVESTMENT |
4088.720 |
1382.490 |
1251.100 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
146.720
|
141.730 |
109.900 |
|
|
Sundry Debtors |
2659.340
|
2227.440 |
1120.400 |
|
|
Cash & Bank Balances |
1511.940
|
702.770 |
30.900 |
|
|
Other Current Assets |
0.000
|
0.000 |
0.000 |
|
|
Loans & Advances |
569.330
|
68.060 |
36.000 |
|
Total
Current Assets |
4887.330
|
3140.000 |
1297.200 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
206.680
|
172.010 |
207.800 |
|
|
Provisions |
100.140
|
99.480 |
24.900 |
|
Total
Current Liabilities |
306.820
|
271.490 |
232.700 |
|
|
Net Current Assets |
4580.510
|
2868.510 |
1064.500 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
72.350 |
65.070 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
9875.900 |
5484.920 |
3301.200 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.12.2007 15 Months |
30.09.2006 12 Months |
30.09.2005 12 Months |
|
|
Sales Turnover |
5562.660 |
3212.850 |
2233.000 |
|
|
Other Income |
0.000 |
0.000 |
20.600 |
|
|
Total Income |
5562.660 |
3212.850 |
2253.600 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
1448.640 |
882.280 |
595.000 |
|
|
Provision for Taxation |
29.880 |
22.000 |
33.700 |
|
|
Profit/(Loss) After Tax |
1418.760 |
860.280 |
561.300 |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Material Cost |
3240.450 |
1943.640 |
1266.400 |
|
|
Personal Cost |
241.140 |
127.730 |
98.000 |
|
|
Manufacturing and Other Expenses |
491.160 |
153.280 |
165.00 |
|
|
Interest |
73.980 |
54.320 |
37.200 |
|
|
Depreciation |
67.290 |
51.600 |
49.600 |
|
Total Expenditure |
4114.020 |
2330.570 |
1658.600 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
31.03.2008 1st
Quarter |
30.06.2008 2nd
Quarter |
|
Sales Turnover |
|
1281.500 |
1409.000 |
|
Other Income |
|
1.500 |
1.300 |
|
Total Income |
|
1283.000 |
1410.300 |
|
Total Expenditure |
|
915.100 |
979.500 |
|
Operating Profit |
|
367.900 |
430.800 |
|
Interest |
|
24.600 |
36.300 |
|
Gross Profit |
|
343.300 |
394.500 |
|
Depreciation |
|
17.300 |
17.900 |
|
Tax |
|
6.200 |
6.400 |
|
Reported PAT |
|
319.800 |
370.200 |
KEY RATIOS
|
PARTICULARS |
31.12.2007 15 Months |
30.09.2006 12 Months |
30.09.2005 12 Months |
|
Debt-Equity Ratio |
0.48 |
0.23 |
0.26 |
|
Long Term Debt-Equity Ratio |
0.38 |
0.13 |
0.15 |
|
Current Ratio |
4.96 |
3.39 |
2.36 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
3.46 |
2.77 |
1.98 |
|
Inventory |
30.67 |
25.43 |
16.73 |
|
Debtors |
1.81 |
1.91 |
2.49 |
|
Interest Cover Ration |
15.04 |
15.78 |
16.99 |
|
Operating Profit Margin(%) |
29.29 |
31.06 |
30.53 |
|
Profit Before Interest and Tax Margin (%) |
28.07 |
29.44 |
28.31 |
|
Cash Profit Margin (%) |
26.93 |
28.50 |
27.36 |
|
Adjusted Net Profit Margin (%) |
25.71 |
26.89 |
25.14 |
|
Return on Capital Employed (%) |
16.55 |
21.86 |
21.40 |
|
Return on Net Worth (%) |
21.94 |
24.37 |
23.85 |
LOCAL AGENCY FURTHER INFORMATION
OVERVIEW:
Hitherto company was following accounting year from October to September every year,
but in order to coincide accounting year with those of associate companies and
WOS abroad, the accounting year of the company has also been changed to
January-December every year. Consequently, the current accounting year has been
extended up to 31st December 2007 and accounts have been compiled for 15 months
period and results have been declared for the period from 01.10.2006 to
31.12.2007. In view of this, the current year's figures are not comparable with
that of the previous year.
The Company has a very successful year registering highly improved performance
on all key parameters. During 15 months period ended on 31st December 2007, the
turnover has increased to Rs.5514.48 million representing the growth of 38.43%
on annualized basis compare to Rs.3186.94 million in the previous year. The
profit after tax increased to Rs.1418.76 million as compare to Rs.860.28
million in the previous year. The performance during the year was driven by
significant growth in export sales across the developed and emerging markets,
increased operating efficiencies, a continuing focus on cost optimization and
better management of working capital. Riding on the economy's growth momentum,
the company has posted improved performance, with revenue and profits higher
that ever before. The company's Unit at Kandla Special Economic Zone has also
been awarded Top Exporter Award for the financial year 2006-07.
The company today has well entrenched into the semi regulated markets of the
world consisting of markets like CIS, Africa and Third Front comprising of
Latin America, South East Asia and Gulf Countries and also has presence in
India in the OTC segments. The company's brands including Travisil., Mountain
Herbz.,
Effertabs(R) Coach's Formula(R) and Therasil(R) have become leading brands in
the international markets where company is operating. Unlike, other
pharmaceutical players in the Indian market who are fighting for a pie of the
available export generics opportunity, the company has adopted a completely
different path by focusing on high margin herbals and nutraceuticals in the
international markets. After initially focusing on the unregulated markets such
as CIS and Africa, the company has now entered in the regulated markets like
the US and Europe.
ACQUISITION ABROAD:
The Company considered acquisitions as part of its growth strategy. During the
period, the company had entered into a Merger and Acquisition Agreement for
acquisition of NATROL INC., a USA based US$ 100 million nutraceutical I herbal
company listed at the Nasdaq, for a total consideration of US$ 80.8 million.
This acquisition has been planned through a SPV route, the immediate SPV being
at Netherlands in the name of Plethico Global Holdings, BV, which will
ultimately acquire 100% equity of Natrol INC, USA.
Natrol is synergistically operating in the herbal / nutraceutical sphere, but
is predominantly present in USA. Natrol has a portfolio of Healthcare and
wellness brands representing quality nutritional supplements, functional herbal
teas and sports nutritional products. Established in 1980, Natrol's portfolio
of brands includes Natrol(R) MRI, Prolab(R) Laci Le Beau(R), Promensil(R),
Trinovin(R), Nu Hair(R) and Shen Min(R).
Natrol distributes products nationally through more than 54,000 retailers, as
well as internationally in over 40 other countries through distribution
partners and subsidiaries in the UK and Hong Kong. The company intends to
market Natrol stop brands into Indian and other stronghold semi-regulated
markets. Likewise, company also plans to launch its leading homegrown brand
Travisil in the US Markets through well-established marketing and distribution
network of the Natrol. With this acquisition the company has evolved into a
global pharmaceutical company in terms of outlook, focus, presence, customers
and employment.
FCCB:
During the year, the company has successfully floated issue of zero percent
Foreign Currency Convertible Bond (FCCB) of US$ 75 million. This issue was
meant to part finance overseas acquisition(s) of brands / pharmaceutical and /
or nutraceutical company. The FCCB maturing on 23.10.2012 has been listed at
SGX-ST, Singapore.
SUBSIDIARIES ABROAD:
During the period, the company has floated a SPV at Netherlands in the name of Plethico
Global Holdings BV for ultimate acquisition of equity holding of Natrol INC,
USA. The company holds 100% equity of this SPV at Netherlands. The company has
also floated another wholly owned subsidiary at UAE in the name of Plethico
International Limited to set-up an ultra modern formulation / lozenges
manufacturing unit in the UAE to cater the demand of CIS, GCC, Middle East,
South East Asia and the African Countries.
During the period, the company has disinvested its equity holding partly in all
the six subsidiaries in CIS namely CJSC Rezlov, Russia, Too Rezlov Limited,
Khazakistan, Rezlov MOSRL, Moldova, SC Rezlov Ukraine, Rezlov LLS, Azarbaijan
and Rezlov Limited, Kyrghzstan, for a total consideration of USD 13.26 million
yielding capital gain of USD 5.23 million. This part dilution will bring down
the company's holding in all the above companies uniformly to 45%. Since all
such companies have ceased to be subsidiary during the period, no reporting
under section 212 of the Companies Act, 1956 is being made in respect
thereof.
MANAGEMENT
DISCUSSION AND ANALYSIS:
INDUSTRY STRUCTURE AND
DEVELOPMENTS:
'Nutraceuticals' is a broad term that includes foods, dietary supplements, and
medical foods offering health/medical benefits including the prevention and/or
treatment of disease. A nutraceutical can also be defied as a foo that impacts
positively on an individual's health, physical performance or state of mind, in
addition to its nutrition content. Thus a nutraceutical is a product with a functional
ingredient that provides specific nutritional benefit. Nutraceuticals are
currently classified as foods and not drugs. Therefore any medical claims to
prevent, treat or cure disease cannot be made for nutraceutical products.
However, both the dietary supplements and functional foods are permitted to
make health claims. The distinction between health claims and medical claims
tend to blur with the advent of new and wideranging products in this category.
The regulatory authorities are becoming increasingly concerned with
nutraceutical products and the messages related to them, as there is a
potential for consumers to be mislead.
The market for Nutraceuticals is analyzed by the following Product
Groups/Segments:
A. Dietary Supplements Vitamins Minerals Herbals Non Herbals Others
B. Functional Foods Dietary Supplements:
Dietary supplements are intended to supply nutrients such as minerals,
vitamins, fatty acids that are missing or not consumed in adequate quantity in
a regular diet. Besides nutrition enhancement and filling up the deficit for
nutrients missing in regular diet, dietary supplements are used to improve
resistance against diseases, and to enhance energy and performance levels.
Dietary Supplements may be broadly classified based on the form of product
availability. The categories include:
Dietary Supplements in the
Ingredient Form:
* Vitamins and Minerals
* Herbals and Related Extracts
* Nutrients
* Proteins
* Functional Additives
* Fibers
Dietary Supplements in the End-Use
Product Form Vitamins:
* Minerals
* Herbals
* Non-Herbals Others
* Sports Nutrition
* Meal Supplements
* JointCare
* Weight Loss
Functional Foods:
Functional food contains a food component, whether a nutrient or not, which
affects one or more targeted functions in the body in a positive way.
Functional foods provide benefits beyond basic nutrition by way of added
components and may prevent disease or promote health. In order to deliver some
health benefit, foods are fortified with minerals, vitamins, antioxidants,
probiotics, prebiotics, herbs, botanicals, oils and many other health rendering
ingredients.
NUTRACEUTICALS - EXECUTIVE
SUMMARY:
GLOBAL MARKET OVERVIEW:
Worldwide nutraceuticals market continues to be effected by growing consumers'
desire to lead a healthy life and avoid usage of synthetic drugs. Increasing
scientific evidence supporting health foods coupled with an explosion in sales
of nutraceuticals, resulted in tremendous growth of the market. Major trends
influencing the market include growing competition leading to industry
consolidation, maturing markets in the developed regions, food and
pharmaceutical players flooding the market and volatile conditions in the
herbal supplements market. Dietary supplements market, through out the 1990s,
enjoyed double-digit growth rates in buoyant market conditions led by herbal
supplement products. However growth in the market slowed down influenced by
several factors including altering consumer demands and economic pressures,
together with tightening regulatory requirements and competitive market
conditions. Market growth slowed down for herbal/botanical supplements, but
other dietary supplements, including non-herbals, and sports nutrition and meal
supplements are experiencing strong growth rates. Vitamins and minerals are
projected to generate relatively slow growth in worldwide nutraceutical
applications, resulting from intense pricing competition, overall lack of
proprietary compounds and mature product applications. Vitamins A and E are
expected to perform the best among bulk vitamins due to increasing evidence of
health advantages and expanding end-user preferences for value-added natural
formulations. Among minerals, calcium and potassium are expected to record
fastest sales gains based on demonstrated preventive benefits in geriatric and
women's health care.
Market Drivers:
General forces assisting the
development of nutraceuticals include:
* Significant increase in scientific understanding of the link between
diet and health
* Rising interest in consumer-directed healthcare
* Aging of the world populace
* Technical developments in the food industry
* Growing importance of cost control in healthcare delivery
Imperatives for a Successful
Nutraceuticals Market:
For the nutraceuticals market to
be successful, following are some of the basic requirements:
* More health conscious consumers
* Positive media publicity
* Scientific studies and clinical trials supporting safety and
efficacyclaims
* Propagation of information detailing the benefits of consuming
supplements and health foods
Aging Population:
Desire to Stay Younger Aging population is a major segment, which is likely to
be instrumental in fueling future growth for nutraceuticals. Desire to stay
younger for a longer period has been driving the population (over 45 years) to
take active support of antiaging supplements that help them live longer and healthy.
Educational and Promotional Programs: A New Strategy
Increasing number of health conscious consumers, and the health benefits
of nutraceuticals are motivating manufacturers and marketers to educate general
public with the help of public relations and advertising.
Use of Biotechnology:
Biotechnology, in recent times is widely employed in nutraceuticals to make
food better, safer, inexpensive and tastier. The agronomists or food
technologists are researching on various tools to increase the volume of
vitamins and minerals in foods. Increase of vitamins and minerals in foods
would help eliminate certain ailments, and provide several health
benefits.
OUTLOOK:
Global Nutraceuticals market, comprising of two principal segments Dietary Supplements
and Functional Foods, is poised to grow at a compounded annual growth rate
(CAGR) of 6.1 during 2000-2010. Sales of nutraceuticals are projected to reach
US$187.4 billion by 2010 as against an estimated US$155.9 billion for 2007.
Factors driving the market include growing consumer interest in a healthy diet
and lifestyle, rising healthcare costs, and aging population.
US to Remain Dominant:
The United States represents the largest market worldwide for nutraceuticals,
with an estimated sales figure of US$50 billion in 2007. Factors fuelling
demand for nutraceuticals include increased awareness of health, a shift
towards preventive medicine and self-medication, impact of aging population in
developed markets anal a desire to lead healthy lives. Nutraceuticals sales in
the US are expected to reach US$59.4 billion by 2010, registering a CAGR of 6%
during 2000-2010. Following the US, Europe and Japan are the next largest
markets.
Fastest Growth in Developing
Regions:
Asia Pacific is expected to witness fastest growth in the nutraceuticals market
through 2015, reflecting rising consumer income levels, increasing per capita
consumption of nutritional products and growing investment in both bulk and
end-use product industries. Buoyed by the robust Chinese and Indian
nutraceutical markets, the Asia-Pacific market is expected to record remarkable
gains in nutraceuticals arena, resulting from rising economic prosperity. The
region is forecast to register the fastest growth of about 6.6% over the analysis
period 2000-2010, to garner sales worth US$16.2 billion by 2010 from an
estimated US$13.1 billion for 2007.
The US, Japan and major European countries would remain the largest global
producers and consumers of nutraceuticals due to high-income levels of
consumers, greater awareness and widespread preferences for specialty
nutritional and herbal products, and trends promoting preventive medicine and
self-treatment.
TABLE 1: World
Nutraceuticals Market (2000-2010):
Geographic Regions Ranked by
Growth:
US, Canada, Japan, Europe, Asia Pacific (excluding Japan), Latin America
and Rest of World:
|
Region/ Country |
%
CAGR (2000-2010) |
|
Asia-Pacific |
6.59 |
|
Canada |
6.51 |
|
Europe |
6.28 |
|
Latin America |
6.04 |
|
US |
6.00 |
|
Japan |
5.94 |
|
Rest of World |
5.21 |
|
Total |
6.13 |
PERFORMANCE
ANALYSIS:
a) A note on the business
segment:
a. The Principal range of fast moving Herbal / Nutraceutical / Allopathic
range gets displayed above region wise.
b. In Africa, Ivory Coast and Congo are one of the most active markets
for herbals and nutraceuticals.
c. 'Other's' column includes Allopathic sales largely.
b) A note on the SBU.
Strategic Business Units (SBU) :
Nature and Description:
1.
CIS SBU
a. USSR disintegrated economies
b. Largely dominated by Russia, Ukraine and Kazakhstan. c. CIS as a
market has some typicalities like;
i. Inelasticity to price (within limits)
ii. Volumes can be increased significantly without compromising margins
if credit can be extended.
iii. Virtual absence of cash down payment in the market for quantum
buys.
iv. New players are generally not welcomed.
v. Plethico's sales largely dominated by Travisil range, Herbal food
supplements and Effervescent range etc. All products which are NOT run of the
mill product. Requiring a lot sales and marketing push.
vi. Rezlov Limited, the fully integrated and marketing chain in CIS
countries has been acquired by Plethico with the following rationale:
1. Extended arm philosophy.
2. Non dependence on distributors (keeping in tune with Plethico's
philosophy).
2.
If not enhances recovery, at least safeguards
recovery.
4. Aids registration of products safely and securely.
5. Enables Plethico to focus on it's core competency i.e., manufacture of
quality products and marketing.
6. Last but not the least, enhanced realization post take over.
d. The seasonality involved which
affects shipments are:
i. CIS largely is covered under ice from October / November to
March.
ii. Incidentally this is also the PEAK season for cough and cold
segment.
iii. This period due to snow looming becomes a no shipment zone
period.
iv. The relevant shipments to be in salable state need to be (logically
and logistically) custom cleared and available
in the country from August / September to
February, but the relevant shipments can only move from India by May to
August.
v. This result in larger sales in second half, which happens to be Q3 and
Q4.
Third Front SBU:
a. The Non-CIS SBU includes all countries excluding CIS countries and
India i.e. Latin American countries (LAC), Gulf Co-Operation Council (GCC) and
South East Asian Countries (SEA) etc. etc.
b. The credit cycles in these markets are unlike CIS, but due to the off
beat nature of the products and relatively new market presence keeps the credit
on the stretched end right now but going forward after achieving certain
critical mass. It is expected that this can be reversed.
c. Current year actually saw the Third Front (SEA / LAC and GCC) grow to
an almost INR 60 Crore plus market.
India:
a. India is the single largest Country contributor for the Company.
b. There are two businesses that are forming part of domestic marketing
viz. Contract Manufacturing and Toll Manufacturing (CM/TM) business and the OTC
business. In the years to come, the company expect this to undergo a change,
wherein the company will defocus on this segment and substitute this with
voluminous and better yielding businesses like supplies to advanced countries
etc.
SEGMENT-WISE,
SBU-WISE AND PRODUCT-WISE PERFORMANCE:
One of the largest contributor to the Company's topline and bottomline
are products which are in the Cough and Cold segment. The largest contributor
today is CIS SBU. These two reasons give the company a seasonality touch. Cough
and cold pre-supposes either allergic reasons or cold climate. The 1st and 2nd
quarter generally has lower export content and largely the export starts
picking up from fag end of 2nd quarter, and continues to increase in the 3rd
and 4th quarter. Since the first and second auarters are generally dull on
exports, the capacities are filled up by resorting to Contract manufacturing /
Toll Manufacturing (CM/TM) business.
The performance of 2006-07 (15 months) can be summarized as under:
a. 68% of sales was from exports.
b. 57% of overall sales is contributed by Herbals and
nutraceuticals.
c. 61% sales is contributed by India and CIS.
d. Indian operation is largely dominated by CM/TM, though not a focus
business for Plethico. e. The Third front consisting of SEA, LAC and GCC
performed exceedingly well to contribute 23%
BUSINESS
OUTLOOK:
The Company began the year 2006-07 with lot of things to look forward to based
on certain ground work already kick started by the Board of Directors and
Senior Management team. The following were some of the possible pointers that
could be achieved in the current year or in coming few years (subject to
disclaimer below) apart from a organic growth target of atleast 20% over
previous year considering the fact that Year on Year (YoY) they were achieving
30% plus growth and also based on the fact that there is a growing potential in
some of the markets that they are present today like the third front and Indian
OTC business.
* Foray into the regulated markets of US / UK / Europe.
* New products in the herbal / Nutraceutical segments
* Approval of the facilities by the UK MHRA and US FDA
* To foray into retail pharmacy chain in CIS.
Building upon Herbal focus:
* To setup Herbal focused chain shops in India.
* To acquire a Company abroad focused on Herbals with a full fledged
research, regulatory and Quality Assurance department.
Stepping up India OTC
business:
* Enhanced Product basket and Distribution setup.
* To have a robust pan India distribution setup.
* To have a strong product portfolio. (Like the new launch expected of
Coolz.)
* To be a market leader in the Lozenge segment.
Scale up Organic farming
process:
* Organic farming involves cultivation of herbs using non chemical base fertilizers
and non chemical base insecticide, pesticide and wedicides.
* This forming is done through natural manure and through special
bacteria's spray available in the market.
* This enables the cultivator to avoid the cultivation from getting exposed
to any chemical or organism risk.
* This enables Herbal Companies like the to standardize herbs as all
cultivation is being sourced from single source, so, the yields could be
assumed to be uniform.
The company's strategies for enhancement in key areas have presented an
optimistic growth path to look forward. To create a sharper focus on
market-share expansion, the company is in process of establishing a therapy
management module. The company has set-up various strategic business units (SBU)
to optimize the product mix and market access methods and leverage its core
competence of low cost manufacturing and marketing to further strengthen its
position in the Indian market.
PERFORMANCE
ACHIEVEMENTS:
Major Achievements of
2006-07:
Activating brokers for International Acquisition: The process was started in
November, 2006. The objective was to acquire a synergistic business in the US.
The Company evaluated proposals ranging from $15 Million to $ 60 Million. This
search helped the Company to get a first hand feel on what is available in the
US markets in this range. A senior management team was deployed in April 07 to
start meetings with prospective sellers and to undertake a detailed evaluation
process before taking a decision to invest.
Acquisition sighted: The Company quickly locked in on a probable list of target
Companies it had identified after visit during the April visit.
Funding by Foreign Currency Convertible Bonds (FCCB) : The Company successfully
raised $ 75 Million for financing the prospective deal in hand. The Company had
identified Natrol Inc (NTOL) a Nasdaq listed entity manufacturing and marketing
Herbal and nutraceuticai formulations in the US. It had a retail reach of more
than 55000 outlets. The target was to be acquired through a friendly merger
deal which was announced on 18th November, 2007 for cash at $ 80.8 Million. The
Company's annual revenues were approximately $100 Million with a projected
EBITDA of 10%.
Change of Accounting Year: The Company announced that it desired to change it's
accounting year end to 31th December,. Hence the current accounting year was to
be for 15 months. The transition was being made to make ease of consolidation
as globally including US, UK, CIS the year ends are 31st December.
Sale of stake in Rezlov: The Company in 2003 had started acquiring strategic
stake Rezlov Group of Companies in CLS starting all across at 51% stake. In the
meantime, the Company had increased stake to 75% in 3 Companies. The Company
sold stake in 2007 in all the Companies to accommodate a new strategic partner
from Switzerland who took stake in all the six entities. The objective of
disinvestment was not to earn INR 164.600 Millions of profit for diluting stake
or to make the holding uniform in all entities at 45%. The objective was to
bring in a strategic partner who would help their cause of deepening the reach
in European markets starting from East European markets.
Fixed Assets:
·
Land
·
Land Development
·
Factory Building
·
Office Premises
·
Plant and Machinery, Equipmnetns, Utility, Boiler
and Electric Fixtures and Fittings
·
Furniture and Fixture
·
Computers
·
Vehicles
·
Agricultural Equipments
AS PER WEBSITE
Profile:
Subject is global healthcare / pharmaceutical
company with a strong emphasis on the herbal and neutraceutical segments. The
company which was established in 1991 and focused on manufacturing and
marketing a range of branded generic pharmaceutical formulations, has rapidly
evolved and now engages in the manufacture, marketing and distribution of
pharmaceutical and allied healthcare products in the neutraceutical and herbal
segments in India and internationally. Domestically, Plethico operates in the
segments of Sports Nutrition, Confectionary and OTC, in India. The company’s
robust product portfolio includes renowned, international brands such as:
Herbal
healthcare products:
·
Travisil – a range of herbal products
in the respiratory tract infection, common cold and sore throat segment, which
continues to be a brand leader in the CIS countries. Travisil portfolio
comprises Travisil Syrup and Lozenges, Travisil Cold Rub, Travisil Roll-on,
Travisil Sugar Free Syrup and Lozenges and Travisil inhaler.
·
Mountain Herbz - a range of clinically
proven and scientifically validated herbal extracts, which offers a safer
alternative to treat life style, related disorders (www.mountainherbz.com)
Food
Supplements
·
Coach’s Formula - a range of popular
sports nutrition products available in India. Coach’s Formula aims at bringing
high value sports supplements for fitness enthusiasts, body builders and sports
persons. Currently products under this brand are available in India, CIS, Sri
Lanka and some of the African countries
·
Confectionary – Byte and Actifresh
Pharma
OTC
·
Effertabs - a range of effervescent
products, in pain, fever, cold, indigestion and nutrition category. (C-MAX,
Plestal Effertabs, Relievo Effertabs, Fastorik Plus Effertabs etc.)
·
Therasil
·
Pharmaceuticals formulations
In addition to India in the OTC segment, Plethico is also a
leading player in the Commonwealth of Independent States (CIS), Africa, South
East Asia, Latin America and in the GCC for its Travisil range of products.
With the recent acquisition of Natrol – a leading manufacturer and marketer of
branded nutritional products in the United States, Plethico has now expanded
its global footprint to the regulated markets of the United States and Europe.
Milestones:
1963-70
The beginning of the group activity.This decade saw the
establishment of the company's first formulation plant, manufacturing tablets,
Capsules and Liquid Orals, at Indore, Madhya Pradesh, India.
1971-80
Up-gradation and expansion of Manufacturing Facilities.
Establishment of a nation wide marketing and distribution network. Introduction
of branded formulations in various categories.
1981-90
An ultra modern formulation plant was established at
Manglia, near Indore, to manufacture a wide range of allopathic formulations.
Innovative branded formulations were introduced and established in
Anti-malarials, Anti-tubercular, Cardiovascular and Cough and Cold segments.
The company pioneered the launch of Doxycycline and Cotrimoxazole in the Indian
market.
1991-2000
·
Diversification into Herbal and Natural
formulations with scientific and modern manufacturing plant for Herbals set up
at Indore.
·
Introduction of novel herbal products
for Hepatocare, Diabetes and Syndrome X developed with in-house research and
clinical evidence.
·
Major thrust into International
Marketing. Travisil, an indigenously developed herbal Cough and Cold product
became a star performer in the entire CIS market.
2000-2005
·
Commissioning of the state of the art
formulation manufacturing plant at Kalaria, Indore, as per the requirements of
WHO GMP, UK MHRA and US FDA.
·
Plethico brand topped the Anti-Malarial
segment of quinines. (A C Neilson 2002).
·
Plethico, ranked amongst the TOP 5
Anti-TB companies in India, with its revolutionary 3/4 drug fixed dose Anti-TB
combinations.
·
The company re-oriented its business
strategy and launched its Consumer Healthcare Division in India.
·
Ultra modern fully integrated plants
set up for manufacture of PET bottle (AOKI, Japan) and hard boiled candies
(Klockner Hansel GmBH, Germany).
·
The company acquired a marketing and
distribution chain in the CIS, with subsidiaries in Russia, Ukraine,
Kazakhstan, Moldova, Azerbaijan and Kyrgyzstan. Marketing and Distribution
Joint Ventures formed in South East Asia, Africa and Latin-America.
·
Establishment of Plethico Africa
Limited (Kenya), a manufacturing Joint Venture to cater to the East African
market.
2006 -
2008
·
Plethico raises Rs 110 crore from IPO
to part finance:
·
The up-gradation of its Kalaria plant
to make it UK MHRA compliant.
·
Setting up a WHO GMP (World Health
Organisation Good Manufacturing Practices) compliant plant in Jammu and Kashmir
and land to be used for organic farming of important herbs.
·
Setting up a R and D and formulation
and development centre.
·
Acquiring stake in domestic
herbal/OTC/nutraceutical company or a brand.
·
Setting up its corporate office in
Mumbai.
·
The working capital needs.
·
Activating brokers for International
Acquisition: The process was started in November, 2006. The objective was to acquire
a synergistic business in the US. Company evaluated proposals ranging from $ 15
Milllion to $ 60 Million. This search helped Plethico to get a first hand feel
on what is available in the US markets in this range. A senior management team
was deployed in April 07 to start meetings with prospective sellers and to
undertake a detailed evaluation process before taking a decision to invest.
·
Acquisition sighted: Company quickly
locked in on a probable list of target Companies it had identified after visit
during the April visit.
·
Funding by Foreign Currency Convertible
Bonds (FCCB): Company successfully raised $ 75 Million for financing the
prospective deal in hand. Company identified Natrol Inc (NTOL) a Nasdaq listed
entity manufacturing and marketing Herbal and nutraceutical formulations in the
US. It had a retail reach of more than 55000 outlets. The target was to be
acquired through a friendly merger deal which was announced on 18th November,
2007 for cash at $ 80.8 Million. The Company's annual revenues were
approximately $100 Million with a projected EBlTDA of 10%.
·
Sale of stake in Rezlov: Company in
2003 had started acquiring strategic stake in Rezlov Group of Companies in CIS
starting all across at 51 % stake. In the meantime, Company had increased stake
to 75% in 3 Companies. Plethico sold stake in 2007 in all the Companies to
accommodate a new strategic partner from Switzerland who took stake in all the
six entities. The objective of disinvestment was not to earn INR 164.600
Millions of profit for diluting stake or to make the holding uniform in all
entities at 45%. The objective was to bring in a strategic partner who would
help the cause of deepening the reach in European markets starting from East
European markets.
Board
Of Directors:
Mr.Shashikant
Patel (Chairman and Managing Director)
At the helm of Plethico is Mr. Shashikant Patel. He was
appointed Chairman and Managing Director in 1996 and under his guidance and
strategic direction, the company has established a dominant position in the global
healthcare industry and has successfully carved out a niche by focusing on the
herbal and neutraceutical segments, internationally and in India.
A dynamic team builder and business strategist, Mr. Patel
has been associated with the business since over 40 years. An erudite
personality with vast experience in international business as well in-depth
knowledge of the domestic healthcare and pharmaceutical sectors, Mr. Patel’s
vision, foresight and belief on the potential of the global healthcare market,
has catapulted Plethico to higher echelons of growth and expansion.
As soon as Mr. Patel was requested to take charge at the
helm, he immediately set forth in putting in place a strong senior management
team including a professional marketing team, bringing in the best talent
available in the industry. Till then, Plethico was a Rs. 450 million company.
Within a span of 12 years, the company’s revenues grew to Rs. 5500 million. He
has evidently, been the key driving force behind the company’s rapid growth. The
precedent set by the infusion of professional talent into the company, is still
practiced by Plethico. The company’s operations are divided into strategic
business units (SBU), each headed by world-class professionals responsible for
setting goals for their respective SBUs. His son Chirag Patel and daughter
Gauravi ably assist him in steering the company.
Mr. Patel is a Director with Plethico Laboratories Limited,
India, Plazma Laboratories Private Limited, Rezcom Realty Private Limited,
Plethico Global Holdings B. V. Netherlands, Plethico US Holdings Kft., Hungary,
Natrol Inc. USA and Plethico International Limited, UAE.
Mr.Chirag
Patel (Whole Time Director and CEO)
As the CEO, Mr. Chirag Patel has been primarily responsible
for the Company’s foray into the consumer healthcare business and for expanding
its exports and international operations. He commenced his career as a dynamic
apprentice to Mr. Bhaskar Patel, who trained him on the Sales, Distribution,
Production and Financial functions of the company. He too, like his father, was
tremendously excited and driven by the future potential of the global
healthcare and pharmaceutical industry that propelled him to explore new
markets like the CIS and Africa. The objective was to carefully understand the
market dynamics and the economy for business prospects. Under the strategic
guidance of his father Mr. Shashikant Patel, Chairman and Managing Director of
Plethico, Mr. Chirag Patel has been greatly instrumental in further
strengthening the Plethico brand globally in line with the company’s long-term
vision. He has also been chiefly responsible for the company’s resource
management and spearheading initiatives such as implementing
Oracle-Peoplesoft-J.D.Edwards ERP Version 8.9 and finalization of Field Force
Management System from SIFY in three languages (Russian, Spanish and French in
addition to English) to enhance marketing prowess and optimize overall
productivity.
Mrs.Gauravi
Parikh (Executive Director)
Ms. Gauravi Parikh joined Plethico in the year 2000 after
obtaining an MS degree from the University of Ohio, USA. She presently oversees
regulatory affairs, marketing, and the New Product Development (NPD)
disciplines of the company. Ms. Parikh has drawn upon her pharmaceutical
industry experience and strong medical knowledge of molecules to assist the
company in standardizing and to expedite the creation of Registration Dossiers
that are critical in registering the company’s product’s globally. She has to
her credit a past performance of enabling the company to launch more than 200
products worldwide. Her expertise in the areas of marketing and promotions
within Plethico’s identified areas of operations, is also sought on developing
consumer-focused marketing literature that is sent to various centers as part
of the company’s international marketing and promotional activities.
Dr.
Gulam Nabi Qazi
Dr.G.N.Qazi is a renowned Biotechnologist with extensive
international exposure and research oriented experience of 40 years in the
areas of Biochemistry and Microbial Biotechnology and Bioprospecting of Natural
Products. He is presently the Director of IIIM, Jammu, a multidisciplinary
Research Institute specializing in research and developmental studies in the
areas of bioprospecting of natural molecules; biotechnology fermentation and
enzyme technology, microbial biodiversity, molecular biology and gene cloning;
natural products chemistry; cultivation and utilization of drugs and essential
oil bearing plants, standardization of botanicals and chemical engineering and
design backup for packaging of technologies. He has more than 130 publications
in the journals of international repute has filed 70 patents top his credit. He
has been instrumental in transforming the premier institute into a leading
institution focused on R and D and comparable with those in the United States
and Europe. Dr. Qazi is also credited with developing strong international
collaborations with several reputed research institutes in Germany, Britain,
Italy and the United States in the areas of biochemical engineering,
enzymology, genetic engineering, bio prospecting of natural molecules as drug
candidates and quality control and standardization of botanicals.
He is a member of several national and international
academic and research bodies. As a fermentation technologist, Dr. Qazi and his
team is credited with developing a number of important processes some of which
have already been commercialized. He is also a recipient of the highly
prestigious CSIR Technology Award for research in the area of fermentation
process for the production of gluconate salts. For his excellent contributions
in the area of industrial biotechnology, he has also received the VASVIK Award.
Mr.
Abhay Suhane
Mr. Abhay Suhane is an MBA from Devi Ahilya Vishav Vidyalaya,
Indore with vast expertise in the areas of finance, marketing, derivatives,
commodity and capital markets in India. He has conducted several studies on the
Indian commodities market, capital markets and derivatives. An incisive analyst
and researcher, he has conducted research on subjects like ‘Consumer Preference
towards soft drinks’ and ‘Banking in the new millennium in India’
Mr.Pramod
K. Shrivastava
Mr. Pramod K. Shrivastava is a Chartered Accountant with
wide exposure in international trade financing and treasury operations. He has
extensive experience in the field of mobilising finance for trade around the
world in key regions such as London, Hong-Kong, Singapore, Brussels, San
Francisco, Osaka, Bahrain, Frankfurt and Tokyo. He also brings with him
competence in areas of trade finance, forex, investments and banking
operations. Mr. Shrivastava also has in-depth understanding of establishing
enterprises’ international operations both as a wholly owned subsidiary or
joint venture of an Indian company.
Financial
Highlights
·
Annual Turnover 2007: Rs. 5514.48
million
·
Shareowners: 13, 928
·
Financial Year: Jan to Dec
·
Listings:Bombay Stock Exchange,
National Stock Exchange
·
Board of Directors:
o
Mr. Shashikant Patel, Chairman and
Managing Director
o
Mr. Chirag Patel, Chief Executive
Officer
o
Mrs. Gauravi Parekh, Executive Director
o
Dr. Ghulam Nabi Qazi
o
Mr. Abhay Suhane
o
Mr. Pramod K. Shrivastava
Stock
details:
- Code for BSE: 532739
- Code for NSE: PLETHICO
- Demat ISIN number: INE491H01018
Performance
updates:
Business
Oulook:
Company began the year 2006-07 with lot of things to look
forward to based on certain ground work already kick started by Board of
Directors and Senior Management team. The following were some of the possible
pointers that could be achieved in the current year or in coming few years
(subject to disclaimer below) apart from a organic growth target of atleast 20%
over previous year considering the fact that Year on Year (YoY) they were
achieving 30% plus growth and also based on the fact that there is a growing
potential in some of the markets that they are present today like the third
front and Indian OTC business
o
Foray into the regulated markets of US/
UK / Europe
o
New products in the herbal/
Nutraceutical segments
o
Approval of the facilities by the UK
MHRA and US FDA
o
To foray into retall pharmacy chain in
CIS
Building upon Herbal focus:
o
To set up Herbal focused chain shops in
India
o
To acquire a Company abroad focused on
Herbals with a full fledged research, regulatory and Quality Assurance
department.
Stepping up lndia OTC business:
o
Enhanced Product basket and
Distribution setup
o
To have a robust pan lndia distribution
setup
o
To have a strong product portfolio.
o
To be a market leader in the Lozenge
segment
Scale up Organic farming process:
o
Organic farming involves cultivation of
herbs using non chemical base fertilizers and non chemical base insecticide,
pesticide and weedicides.
o
This farming is done through natural
manure and through special bacteria's spray available in the market.
o
This enables the cultivator to avoid
the cultivation from getting exposed to any chemical or organism risk.
o
This enables Herbal Companies like the
to standardize herbs as all cultivation is being sourced from single source,
so, the yields could be assumed to be uniform.
The company's strategies for enhancement in key areas have
presented an optimistic growth path to look forward. To create a sharper focus
on market-share expansion, the company is in process of establishing a therapy
management module. The company has set-up various strategic business units
(SBU) to optimize the product mix and market access methods and leverage its
core competence of low cost manufacturing and marketing to further strengthen
its position in the Indian market.
Disclaimer:
The statement made and those appearing elsewhere may be 'business outlook' that
set forth anticipated results based on management plans and assumptions. These
statements are likely to address the company's growth strategy, financial
results, product development, product approval, product potential and
development programs. Achievement of future results is subject to risks,
uncertainties and inaccurate assumptions. Should known or unknown risks,
uncertainties materialized or should underlying assumptions prove inaccurate,
actual results could vary materially from past results and those anticipated,
estimated or projected. Among the factors that could cause actual results to
defer materially are :
o
Success or failure of the research and
development initiatives
o
The impact of existing and future
regulatory provision on product exclusivity.
o
Competitive developments affecting the
product portfolio
o
Interest rates and foreign currency
exchange rate fluctuation.
o
Statutory legislations and regulations
affecting domestic and foreign operations including tax obligations and other
allied factors.
o
Political and Economical instability
that may affect the business.
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 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.49.77 |
|
UK Pound |
1 |
Rs.79.78 |
|
Euro |
1 |
Rs.63.36 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
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 |
|
67 |
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 |
|