MIRA
INFORM REPORT
|
Report Date : |
12.09.2008 |
IDENTIFICATION
DETAILS
|
Name : |
THERMAX LIMITED |
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Registered
Office : |
D-13, MIDC
Industrial Area, R D Aga Road, Chinchwad, Pune - 411019, Maharashtra |
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Country : |
India |
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Financials (as
on) : |
31.03.2008 |
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Year of
Establishment : |
30.06.1980 |
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Com. Reg. No.: |
25-22787 |
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CIN No.: [Company
Identification No.] |
U29299MH1980PLC022787 |
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TAN No.: (Tax Deduction
& Collection Account No.) |
PNET03854E PNET00017D |
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Legal Form : |
Public Limited
Liability Company. The Company’s Shares are Listed on the Stock Exchanges. |
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Line of
Business : |
Manufacturing of Steam
or other Vapour Generating Boilers, other Refrigerating or Freezing Equipment
and Ion Exchangers of the Polymerisation or Co-Polymerisation type. |
RATING &
COMMENTS
|
MIRA’s Rating : |
Aa |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
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|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
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Maximum Credit Limit : |
USD 37000000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is an old
and well established company. The company is engaged in manufacturing and selling
Air Pollution Control Plants & Systems, water work treatment plants and
Ion Exchange Resins and Chemicals. It is a professionally managed
company. The company is progressing
well. Trade relations
are reported as fair. Payments are usually correct and as per commitments.
The company can be considered good for business dealings at usual trade terms
and conditions. |
LOCATIONS
|
Registered
Office : |
D-13, MIDC Industrial
Area, R D Aga Road, Chinchwad, Pune - 411 019, Maharashtra, India |
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Tel. No.: |
91-20-27475941 |
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Fax No.: |
91-20-27472049 |
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E-Mail : |
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Website : |
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Corporate
Office : |
Thermax House, 4,
Mumbai – Pune Road, Shivajinagar, Pune – 411 005, Maharashtra, India |
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Tel. No.: |
91-20-25512122 |
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Fax No.: |
91-20-25512242/
25511226 |
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E-Mail : |
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Factory 1 : |
Pimpri - Chinchwad, Pune, Maharashtra |
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Tel. No.: |
91-20-27475941 |
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Fax No.: |
91-20-27472049 |
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E-Mail : |
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Area : |
66,000 sq. ft. |
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Factory 2 : |
Village Paudh, Mazgaon, Via Pategarga, Taluka Khalapur, District
Raigad – 410 206, Maharashtra |
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Overseas
Offices : |
Ø Thermax International Limited, Mauritius Ø Thermax (Rus) Limited, Russia Ø Thermax Europe Limited, U.K. Ø Thermax Europe Limited, U.K. Ø ME Engineering Limited, U.K. Ø Thermax Inc., U.S.A. |
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Branches : |
Located At:
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DIRECTORS
|
Name : |
Mr. A. R. Aga |
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Designation : |
Chairman |
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Name : |
Mr. A. M. Nalawade |
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Designation : |
Managing Director |
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Name : |
Mr. P. D. Chansarkar |
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Designation : |
Director |
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Name : |
Mr. D. L. Chavan |
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Designation : |
Director |
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Name : |
Mr. B. M. Desai |
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Designation : |
Director |
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Name : |
Mr. B F. Gagrat |
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Designation : |
Director |
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Name : |
Mr. G. K. Gureja |
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Designation : |
Director |
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Name : |
N. D. Joshi |
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Designation : |
Director |
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Name : |
Mr. P. M.
Kulkarni |
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Designation : |
Director |
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Name : |
Mr. S. S. Marathe |
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Designation : |
Director |
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Name : |
Mr. M. P. Pudumjee |
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Designation : |
Director |
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Name : |
Mr. R. V. Ramani |
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Designation : |
Director |
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Name : |
Mr. H P Ranina |
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Designation : |
Director |
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Name : |
Mr. P. K. Sen |
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Designation : |
Director |
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Name : |
Mr. M. J. Shaikhali |
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Designation : |
Director |
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Name : |
Mr. R. A. Shroff |
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Designation : |
Director |
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Name : |
Mr. G. Trivedi |
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Designation : |
Director |
KEY EXECUTIVES
|
Name : |
Mr. M. M.
Nalavade |
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Designation : |
Company Secretary |
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Name : |
Mr. Amitabh
Mukhopadhyay |
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Designation : |
Executive Vice President and Chief Financial Officer |
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EXECUTIVE COUNCIL :
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Name : |
Mr. Ravinder Advani |
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Designation : |
Executive Vice
President – ESD |
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Age : |
56 Years |
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Qualification
: |
B. E. (Hons)
(Mech.), PGDBM |
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Experience : |
34 Years |
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Date of
Appointment : |
01.05.2000 |
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Previous Employment
: |
Thermax Babcock and
Wilcox Limtied – General Marketing Manager.
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Name : |
Mr. Shishir
Joshipura |
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Designation : |
Executive Vice
President - PHD |
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Age : |
44 Years |
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Qualification
: |
B. E. (Mech.) |
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Experience : |
22 Years |
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Date of
Appointment : |
01.03.2003 |
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Previous Employment
: |
Thermax Energy
Performance Services Limited – CEO |
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Name : |
Mr. Prakash
Kulkarni |
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Designation : |
Managing Director
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|
Age : |
58 Years |
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Qualification
: |
B. E. (Mech.) |
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Experience : |
38 Years |
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Date of
Appointment : |
01.07.1999 |
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Previous Employment
: |
Thermax Babcock
and Wilcox Limited – Managing Director |
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|
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|
Name : |
Mr. Amitabha
Mukhopadhyay |
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Designation : |
Executive Vice
President and CFO |
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Age : |
41 Years |
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Qualification
: |
B. Sc. (Hons.),
ACA |
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Experience : |
17 Years |
|
Date of
Appointment : |
24.10.2001 |
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Previous Employment
: |
IFB Industries
Limited – Vice President Finance |
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|
Name : |
Mr. M. S.
Unnikrishnan |
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Designation : |
Executive Vice
President |
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Age : |
45 Years |
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Qualification
: |
B. E. (Mech.) |
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Experience : |
24 Years |
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Date of
Appointment : |
01.08.1997 |
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Previous Employment
: |
Terrazzo Limited
– Assistance General Manager |
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Name : |
Mr. Sudhir Sohoni
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|
Designation : |
Executive Vice
President |
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Age : |
48 Years |
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Qualification
: |
M A (PM and IR) |
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Experience : |
26 Years |
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Date of
Appointment : |
01.03.2006 |
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Previous Employment
: |
CEAT Limited – Vice
President – Human Resource (Tyre Sector)
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Name : |
Mr. R V Ramani |
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Designation : |
Divisional Head |
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Age : |
54 Years |
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Qualification
: |
B. E. (Mech.) |
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Experience : |
31 Years |
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Date of
Appointment : |
01.10.1974 |
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Previous Employment
: |
Indowse
Engineering Private Limited – Sales Engineer |
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|
|
|
Name : |
Mr. V J Shah |
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Designation : |
Divisional Head |
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Age : |
58 Years |
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Qualification
: |
B. Tech. (Chem.
Engg.), MBM |
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Experience : |
30 Years |
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Date of
Appointment : |
15.05.1988 |
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Previous Employment
: |
Rieco Industries
Limited – Senior Manager |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
|
Names
of Shareholders |
No. of Shares |
Percentage of Holding |
Promoters' Holdings
|
73855305 |
61.98 |
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Non Promoter's Holdings
|
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Mutual Funds and
UTI Banks, Financial Institutions and
Insurance Companies |
19165729 |
16.08 |
|
FIIs |
5008383 |
4.20 |
|
Private Corporate
Bodies |
4252943 |
3.57 |
|
Indian Public and
Others |
16665162 |
13.99 |
|
NRIs / OCBs |
208778 |
0.18 |
|
Total |
119156300 |
100.00 |
BUSINESS DETAILS
|
Line of
Business : |
Manufacturing of Steam
or other Vapour Generating Boilers, other Refrigerating or Freezing Equipment
and Ion Exchangers of the Polymerisation or Co-polymerisation type. |
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Products : |
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PRODUCTION STATUS
|
Particulars |
|
Unit |
Installed Capacity |
Actual Production |
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Energy Products & Systems a. Boilers Capacity
upto 30MT / Chillers b. Boilers
Capacity above 30MT c. Heaters d. Power Plants |
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Nos. MT Mn. Kg Cal MW |
3281 5700 -- -- |
2080 2727 14 101 |
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Environmental Products & Systems : |
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a. Air Pollution Control Plants and Systems |
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Nos. |
-- |
940 |
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b. Water and Waste Treatment Plants |
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Nos. |
-- |
1713 |
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c. Ion Exchange Resins & Chemicals |
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MT |
34890 |
15856 |
GENERAL
INFORMATION
|
No. of
Employees : |
4464 |
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Bankers : |
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Banking Relations : |
Good |
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Auditors : |
B. K. Khare and
Company Chartered
Accountants |
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Address : |
706/707, Sharda
Chambers, New Marine Lines, Mumbai – 400 020, Maharashtra, India |
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Joint Venture : |
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Associates : |
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Subsidiaries : |
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CAPITAL STRUCTURE
Authorised Capital :
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No. of Shares |
Type |
Value |
Amount |
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|
5000000000 |
Equity Shares |
Rs.2/- each |
Rs.10000.000 Millions |
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Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
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|
119156300 |
Equity Shares |
Rs.2/- each |
Rs.238.313 millions |
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FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES
OF FUNDS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
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|
SHAREHOLDERS
FUNDS |
|
|
|
|
|
1] Share Capital |
238.300 |
238.300 |
238.300 |
|
|
2] Reserves &
Surplus |
7123.100 |
5553.600 |
4547.600 |
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NETWORTH
|
7361.400 |
5791.900 |
4785.900 |
|
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LOAN FUNDS |
|
|
|
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|
1] Secured Loans |
0.000 |
0.000 |
0.000 |
|
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2] Unsecured
Loans |
0.000 |
0.000 |
0.000 |
|
TOTAL BORROWING
|
0.000 |
0.000 |
0.000 |
|
|
DEFERRED TAX
LIABILITIES |
0.000 |
103.900 |
92.900 |
|
|
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TOTAL
|
7361.400 |
5895.800 |
4878.800 |
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APPLICATION OF FUNDS
|
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FIXED ASSETS [Net Block]
|
2786.000 |
1578.800 |
1332.400 |
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Capital work-in-progress
|
475.900 |
116.700 |
43.800 |
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INVESTMENT
|
5797.400 |
5776.100 |
4174.900 |
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CURRENT ASSETS, LOANS & ADVANCES
|
|
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Inventories
|
2553.300 |
2002.400 |
1187.400 |
|
|
Contracts in Progress
|
0.000 |
753.200 |
435.400 |
|
|
Sundry Debtors
|
5053.100 |
3825.100 |
2263.000 |
|
|
Cash & Bank Balances
|
279.100 |
624.700 |
361.100 |
|
|
Other Current Assets
|
0.000 |
219.200 |
215.400 |
|
|
Loans & Advances
|
7670.300 |
1869.500 |
867.300 |
Total Current Assets
|
15555.800 |
9294.100 |
5329.600 |
|
Less : CURRENT LIABILITIES & PROVISIONS
|
|
|
|
|
|
|
Current Liabilities
|
10586.700 |
10000.400 |
4787.200 |
|
|
Contracts in Progress
|
0.000 |
304.600 |
654.300 |
|
|
Provisions
|
6667.000 |
565.900 |
562.400 |
Total Current Liabilities
|
17253.700
|
10870.900
|
6003.900
|
|
Net Current Assets
|
(1697.900) |
(1576.800) |
(674.300) |
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES
|
0.000 |
1.000 |
2.000 |
|
|
|
|
|
|
|
TOTAL
|
7361.400 |
5895.800 |
4878.800 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
Sales Turnover
|
32819.200 |
22100.300 |
14980.000 |
|
Other Income
|
912.700 |
0.000 |
0.000 |
|
Total Income
|
33731.900 |
22100.300 |
14980.000 |
|
|
|
|
|
|
|
Profit/(Loss) Before Tax
|
4303.800 |
2905.400 |
1925.300 |
|
Provision for Taxation
|
1496.000 |
1027.400 |
692.800 |
|
Profit/(Loss) After Tax
|
2807.800 |
1878.000 |
1232.500 |
|
|
|
|
|
|
|
|
Earnings in Foreign Currency : |
|
|
|
|
|
|
Export of goods on FOB |
NA |
3039.800 |
2403.900 |
|
|
Other Earnings |
NA |
16.500 |
16.000 |
|
Total Earnings |
NA |
3056.300 |
2419.900 |
|
|
|
|
|
|
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|
Imports : |
|
|
|
|
|
|
Raw Materials |
NA |
1801.300 |
999.800 |
|
|
Stores & Spares |
NA |
647.100 |
547.900 |
|
|
Capital Goods |
NA |
63.900 |
11.700 |
|
|
Others |
NA |
70.900 |
11.300 |
|
Total Imports |
NA |
2583.200 |
1570.700 |
|
|
|
|
|
|
|
Total Expenditure
|
29428.100 |
19194.900 |
13054.700 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
|
30.06.2008 |
|
Type |
|
|
1st Quarter |
|
Sales Turnover |
|
|
7169.700 |
|
Other Income |
|
|
101.800 |
|
Total Income |
|
|
7271.500 |
|
Total Expenditure |
|
|
6258.500 |
|
Operating Profit |
|
|
1013.000 |
|
Interest |
|
|
2.600 |
|
Gross Profit |
|
|
1010.400 |
|
Depreciation |
|
|
70.000 |
|
Tax |
|
|
303.300 |
|
Reported PAT |
|
|
637.100 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
Debt Equity Ratio |
|
0.00
|
0.00
|
0.00 |
|
Long Term Ratio |
|
0.00
|
0.00
|
0.00 |
|
Current Ratio |
|
0.90
|
0.90
|
0.94 |
|
Turnover Ratios |
|
|
|
|
|
Fixed Assets |
|
9.40
|
8.30
|
7.50 |
|
Inventory |
|
12.36
|
9.90
|
11.76 |
|
Debtors |
|
7.39
|
7.12
|
7.89 |
|
Interest Cover Ratio |
|
66.71
|
40.10
|
38.46 |
|
Operating Profit Margin (%) |
|
13.98
|
14.61
|
13.51 |
|
Profit Before Interest and Tax Margin (%) |
|
13.31
|
13.74
|
12.55 |
|
Cash Profit Margin (%) |
|
9.22
|
9.53
|
8.79 |
|
Adjusted Net Profit Margin (%) |
|
8.56
|
8.66
|
7.82 |
|
Return on Capital Employed (%) |
|
66.44
|
56.35
|
44.53 |
|
Return on Net Worth (%) |
|
42.69
|
35.51
|
29.09 |
LOCAL AGENCY
FURTHER INFORMATION
HISTORY:
Subject (Thermax) came to business in 30th June of the year 1980,
headquartered in Pune, India, Company provides sustainable solutions in Energy
and Environment by the way of standard products in the 6 areas of business,
such as Boilers and Heaters, Absorption Cooling, Water and Waste Solutions,
Chemicals for Energy and Environment applications, Power and Cogeneration
systems and Air Pollution and Purification Thermal's international operations
are spread over South East Asia, Middle East, Africa, Russia, UK and the US.
Tulsi Fine Chemical Industries Private Limited and Kailas Castings Private
Limited were merged with the company with effective from 1st July of the year
1982. As at 1st July 1989, Thermax became a deemed public company. In the year
1991, T. K. Steel Industries Ltd was merged with the company. During the year
1994, the company's status was changed from deemed public company public
company. The process heat division came out with a new boiler design in the
year 1995, an oil fired smoke boiler, shell Max and Combiac, a boiler specially
designed to burn agro fuels like rice and groundnut husk, saw dust, coffee
waste etc. also in the same year of 1995, a Memorandum of Understanding (MoU)
was signed with Bharat Shell for thermic fluid, therma, for heat transfer
system. The process heat projects division received an order from PT South
Pacific Viscose, an Indonesian Company for supply of 3 boilers of 22.5 tonnes
per hour of steam. Energy System Division of the company was born in the year
1996 by the way of merger of two division, one in the energy area and the other
in heat recovery area to pool the expertise with a view to addressing the heat
recovery business and also in the same year launched fine circulation fluidised
bed combustion boiler. The MoU was signed with Bharat Shell and the Process
Heat Division of the company.
During the year 1997, the company had received the AD-Merkblatt certification
for the entire manufacturing unit at Chinchwad. An electronic network called
Thermnet linking all establishments of the company in the country was introduced
during the year same year of 1997 and also Thermax had entered into a joint
venture with Fuji Electric Company of Japan. The Company had introduced five
new products in the standard packaged boiler range during the year 1998 and
also launched a wide range of products incorporating Kawasaki modular
technology in our Vapour Absorption Division. Thermax Co-gen Limited became a
subsidiary of the company in the year 1999. During the same year 1999, the
company had developed a more advanced process called PDP II. During the year
2000, Company had acquired ME Engineering, a UK-based company belonging to the
Beel Industrial Boilers Plc group. The Company has signed an exclusive
distribution agreement for South Asian markets with US company Purafil Inc to
market their dry gas scrubbers popularly known as chemical filters. Thermax had
signed a memorandum of understanding with the Society of Applied Microwave
Electronics Engineering and Research for commercialisation of the latter's
microwave disinfections system for treating pathological bio-medical waste
generated by hospitals and research institutes. The Company had set up wholly
owned subsidiary company in the US, namely Thermax Inc and another one in
Detroit, USA in the year 2001. Compnay had acquired 50% of stake in Energy
Performance Service (Thailand), a subsidiary of Energy Performance Service of
Canada. The Company and Cummins Diesel Sales and Services had entered into a
strategic alliance to provide attractive energy solutions to various industry
segments.
With the investment of US $ 200,000, the company had incorporated a wholly
owned overseas (WOS) subsidiary in Brazil during the year 2003. Company had
bagged an order for Captive Power Plant in the year 2004. During the year
2004-05, the company's chemical plant at Paudh, near Mumbai had received the
OHSAS 18001:1999 certification from BVQI. COFEX 2005 honored with special award
for Thermax's contribution to the HVAC industry. Company had inked a technical
know-how transfer and license agreement with Balcke-Durr, Germany in October of
the year 2007 for dry and wet electrostatic precipitators (ESPs), air pollution
control equipment for power, industrial and utility segments upto 300 MW.
As at February 2008, the company had signed a technical transfer license
agreement with US-based Babcock & Wilcox Power Generation Group (B&W)
to engineer, manufacture and sell sub critical B&W radiant utility boilers
in India. As of May 2008, the company had inked a protocol of agreement for an
export order, for supply of heat recovery steam generator (HRSG). Company had
received an order from a major refinery in July of the year 2008, to supply
pulverised coal fired boilers for their captive cogeneration plant valued at
approximately Rs.8.2 billion and also in August of the same year 2008, received
an order of Rs.4.15 billion, from a leading steel making company in August pf
the year 2008, for setting up a captive power plant for their upcoming blast
furnace complex on an EPC basis.
Company is planning to set up a new Rs.5-billion manufacturing plant for large
boilers of capacity 100 mw to 800 mw for power plants. In the first phase, the
company will have a capacity to produce sub-critical boilers with total
capacity of 1,500 mw per annum, which would entail an investment of Rs.3
billion. In the next phase the company will scale up the capacity of the
boilers of equivalent to 3,000 mw with an additional investment of Rs.2
billion.
PERFORMANCE:
The company has posted robust results during the year with
total income at Rs.32460.000 Millions, up from Rs.22100.000 Millions in the
previous year, registering a pmwth of 47%. Profit before tax and extraordinary
ieos at Rs.4280.000 Millions, recorded a growth of 45%.
Profit after tax is higher at Rs.2808.000 Millions from Rs.18780.000 Millions
of the previous year. Earnings per share (FPS) moved up significantly to
Rs.23.56 compared to Rs.15.76 in 2006-07.
During the year exports, including deemed exports, have risen to Rs.67820.000
Millions from Rs.40170.000 Millions last year, a growth of 69%.
DIVIDEND:
The Directors have recommended dividend payment of Rs.8 per equity share (400%)
of face value of Rs.2 each for the financial year 2007-08, as against 300% paid
last year.
The dividend, if approved by the shareholders, will entail a payout of
Rs.1115.000 Millions, including dividend distribution tax Rs.162.000
Millions.
SUBSIDIARIES:
DOMESTIC:
Thermax Engineering
Construction Company Limited:
Thermax Engineering Construction Company Limited (TECC), a wholly
owned subsidiary of your company, undertakes and executes engineering
construction projects mainly for the Boiler and Heater (B&H) business unit
of the parent company. During the year, the company has clocked 1.1 million
man-days and constructed more than 60,000 tons of boiler equipment. This has
been the largest deployment of resources till date. TECC has been involved in
the mega energy project for a large refinery in Gujarat, the largest project
order being executed by the company.
TECC's total income increased by 28% to Rs.1137.000 Millions from Rs.891.000
Millions last year. Profit after tax was marginally lower at Rs. 1.8 crore
compared to Rs.19.000 Millions in the previous year due to higher operating
costs. During the year, the company has invested Rs.30.000 Millions in the
share capital of this subsidiary.
Thermax Instrumentation Limited:
Thermax Instrumentation Limited (TIL), a wholly owned subsidiary, after
expanding into new business activities last year, has now focused its
operations on installation and commissioning of power and cogeneration plants
including civil construction.
In 2007-08, the company had a total income of Rs.1572.000 Millions and profit
after tax of Rs.70.000 Millions. It has simultaneously handled 10 power plants
during the year. The company also received its first overseas order for
installing and commissioning of a power plant from South East Asia.
OVERSEAS:
Thermax
Inc., U.S.A.:
This wholly owned step-down subsidiary is the frontend value
chain for the parent company's two businesses in the USA - chemicals and
cooling.
The income of the company increased by 32% to USD 17.3 million and the company
posted a profit after tax of USD 0.1 million against a loss of USD 0.3 million
last year.
The chemical business showed significant improvement in margins despite cost
pressures. The strategy is now to focus on profitability through a combination
of product mix and pricing.
The cooling business grew substantially during the year and is poised to gain
additional market share through new alliances in the North American market and
scaling up of new applications in the industrial sector in Brazil.
Thermax Europe Limited, U.K.:
This wholly owned subsidiary achieved an overall income of # 3.5 million as
compared to # 3.6 million last year, despite the closure of one of its business
lines. The cooling business grew to # 3.2 million from # 2 million last
year.
Due to unfavorable market conditions the company decided not to pursue the
packaged boiler business in the UK, and it was closed down last year. The
increased awareness in Europe to reduce green house gases and the attempts of
large corporations to check carbon emissions have opened business opportunities
for absorption products.
The company continued to build upon its leadership position in the solar based
cooling systems market and supplied several hot water chillers for solar
chilling applications.
It successfully executed the first of a kind absorption gas chiller coupled to fuel
cells for a German telecom group. During the year it also supplied exhaust gas
based heat pump and bio diesel based cooling system for the emerging CHPC
(combined heating, power & cooling) market.
Thermax Hong Kong Limited, Hong
Kong:
Thermax Hong Kong Limited (THKL), a wholly owned overseas subsidiary, was
established with the dual purpose of making a foray into the Chinese absorption
cooling market and to provide support for the sourcing activities for the
various businesses of the parent company.
The company posted an income of HK$ 8.2 million and made a nominal profit after
tax of HK$ 34,742
The company has achieved its initial objectives on both counts. The parent
company has since established a new subsidiary company Thermax (Zhejiang)
Cooling and Heating Engineering Company Limited, (TZL) in China for the
manufacture and sale of absorption chillers. Thus, the business activities of
the company will now be directly undertaken by TZL. As no new significant
business is anticipated in the next financial year, the company closed its
representative office at Shanghai in December 2007.
Thermax (Zhejiang) Cooling & Heating Engineering Company Limited,
China:
Thermax (Zhejiang) Cooling & Heating Engineering Company Limited, the
wholly owned subsidiary, has been incorporated to set up an absorption chiller
manufacturing facility in the Zhejiang province of China. The new facility will
complement Thermax's Indian manufacturing base and play a key role in its
selective internationalisation programme.
The manufacturing facility is fast approaching completion with all major
machinery installed at site. Trial production has commenced from May 15, 2008
and commercial production is expected to go on stream in July 2008.
During the year, the company has invested USD 8 million in the share capital of
this subsidiary and has earmarked additional funds of USD 3.47 million.
Thermax do Brasil - Energia a
Equipamentos Limited, Brazil (TdB):
During the fiscal year the subsidiary recorded a sales income of BRL 0.4
million against BRL 0.7 million in the previous year. The business model of
providing service to customers has been changed from direct engagement to a
franchisee arrangement from November 2007.
AWARDS AND RECOGNITION:
The company was featured, for the third consecutive year, in the Forbes list of
Asia's 'Best Under a Billion (Dollar) Companies.
During the year, Mrs. A.R. Aga, Director of the company, was honoured at the
Zee Astitva Awards as the Business Woman of the Year 2007. The award is in
recognition of her contributions to industry and society.
The company's well-known house magazine Fireside bagged the gold award for the
best internal house magazine at the 47th awards function of the Association of
Business Communicators of India.
TECHNOLOGY TIE-UPS:
During the year the company has signed three major technology and manufacturing
license agreements with global leaders. These technology agreements would enable
the company to move into new areas of business by adding value to its customer
operations. Brief details of the tie-ups are given below:
Georgia-Pacific Chemicals LLC,
USA:.
A technology and manufacturing license agreement for performance enhancing
chemicals in the paper & pulp industry was signed with Georgia-Pacific
Chemicals LLC, based in Atlanta, USA. Products based on the licensed technology
will enable the company to expand its business in the domestic paper industry
and also in South East Asia.
Babcock & Wilcox Power Generation
Group, Inc., USA:
Building on 20 years of business relationship, including a successful joint
venture with Babcock & Wilcox (B&W), USA the company has entered into
an agreement with the boiler major's Power Generation Group for subcritical
utility boilers up to 800 MW The tie-up will give Company the right to use
B&W's technology to make a significant impact in the power sector, where an
estimated 20,000 MW of capacity is expected to be added every year in the next
15 year period. The company will now manufacture and sell subcritical B&W
Radiant utility boilers in India. These boilers will be largely manufactured at
the company's new manufacturing facility at Savli in Gujarat.
Balcke-Diirr GmbH, Germany:
The company has signed a technical know how transfer and license agreement with
Balcke-Diirr GmbH, Germany, for dry and wet Electrostatic Precipitators (ESPs)
for the power, industrial and utility segments upto 300 MW The agreement covers
leading European and American ESP designs of Balcke-Diirr. For utility power
projects above 300 MW, Balcke-Diirr and your company would cooperate on a
case-to-case basis.
This partnership will give the company a distinct technology edge in the
domestic power, steel, cement and utility sectors and to gain its rightful
share of the air pollution control business emerging from these sectors.
MANAGEMENT
DISCUSSION AND ANALYSIS
OVERVIEW:
Fiscal 2007-08 was a year of mixed fortunes for the developed and emerging economies
of the world including India. Though the first half of the year saw strong
global economic activity spurred by mergers & acquisitions and huge
domestic capacity expansions, the momentum eventually slowed down from the
buoyant conditions of the previous year. The global economy expanded at a
robust pace till the second quarter of 2007, only to falter in the last two
quarters.
This slowdown was mainly triggered by the ongoing housing market correction and
associated financial market turmoil in the U.S. Other factors such as the
doubling of oil prices increase in commodity prices and food grains, high
interest rates and the rising inflation worldwide also contributed to the
overall slowdown of the world economy.
India's GDP growth was 9% in 2007-08, scaled down from the 9.6% in 2006-07 and
9.4% in 2005-06. The industrial sector witnessed a slowdown, to 8.5% during
2007-08 from 11.5% the previous year. The trend suggests a reining in of
economic momentum, and the outlook is marked by guarded optimism for the next
year.
Accompanying this moderation in industrial growth, some segments of the
infrastructure sector such as power generation and movement of railway freight,
as also the production of widespread intermediates like steel, cement and
petroleum, have shown a subdued performance. The manufacturing sector
registered a growth of 9.2%, lower from the 12.5% in the previous year, but
still registering a healthy average. A growth of 18% in capital goods provides
indicators for healthy capital investment in the future.
Inflation is likely to remain a worry because of strong growth, despite
currency volatility and interest rates are expected to remain relatively high
and more likely to rise than fall. India's export growth was at 23.1% this year
compared to 22.5% in 2006-07, in spite of the rupee fluctuations against the
dollar.
The ambitious target of 78,000 MW for additional power generation capacity
taken up as part of the Eleventh Plan is slated to be on the fast track with
the government already approving several mega power projects. The reforms in
the coal and electricity sectors, the various measures to curb price rise in
cement and steel sectors will stimulate domestic consumption and give a boost
to the infrastructure sector, resulting in better growth prospects for the
economy and the capital goods industry.
Similar to the energy sector, the environment sector is also witnessing
considerable investments in wastewater, sewage and effluent treatment; creating
demand for new and advanced technologies for water resource development and
management. With many regions of the country remaining water challenged and
with pollution control norms getting more stringent, integrated solutions for
water, wastewater treatment and recycling are emerging as growth areas for the
next few years. Growth in the power, cement and iron & steel sectors will
be pushing up demand for air pollution control and air purification
systems.
With climate change and carbon emissions emerging as key issues in development
and growth models, government initiatives to review and streamline emission
norms and efficiency regulations are gaining momentum. The focus is shifting to
the promotion of clean technologies that utilise renewable energy and reduce
carbon emissions. This augurs well for your company's green portfolio of
products in the domestic as well as in international markets.
While the macro economic outlook continues to reflect the confidence and
strength of the India success story there is a flip side. The slow implementation
of infrastructure projects - like roads, ports and airports - continues to be a
cause for concern.
REVIEW
OF OPERATIONS:
Fiscal 2007-08 was an exceptionally good year for the company. It generated a total
income of Rs.32460.000 Millions, an increase of 47% compared to the previous
year. Profit after tax rose to Rs.2810.000 Millions from Rs. 1880.000 Millions,
an increase of 50%. Exports, including deemed exports, during the period
represented 21% of the income, an increase of 69% over the previous year.
However, the company ended the year with lesser carry forward orders compared
to the previous year.
Following last year's trend, the Project Business Group contributed to 72% of
the company's income with the Cooling & Heating Group contribution at 17%
and that of the Chemical and Water Group at 11%.
The operational excellence programme under Project Evergreen, initiated earlier
by your company, was cascaded across the various business units. Additionally,
it was extended to bring about improvements in the customer facing dealer
operations and also to upgrade the manufacturing operations of selected key
vendors of some of the project business groups. The project business units also
took this initiative to their construction sites.
To meet its growing business volumes the company had invested in two
manufacturing facilities near Vadodara in western India and in China. The first
phase of the Gujarat plant for boilers and heaters has been successfully
completed and production has begun. The plant would be fully operational by the
second quarter of fiscal year 2008-09. Work on the additional manufacturing
plant for absorption chillers in China progressed well during the year and the
plant is expected to be commissioned by July 2008.
The year saw some strong technology reinforcements in the company. Through
three strategic technology tie-ups, Thermax has upgraded its customer offerings
in the areas of energy and environment. With Babcock and Wilcox, USA, its
erstwhile joint venture partner, it has signed a technology partnership for
utility boilers in the subcritical range. It also tied up with Balcke Durr of
Germany for advanced air pollution control equipment. The third technology
alliance was with Georgia-Pacific of USA for specialty chemicals for the paper
& pulp sector.
During the year, Thermax commissioned a number of captive power plants -
including a plant for a cement manufacturer in Rajasthan with some unique
features. The power business also made its first foray in the international
market by bagging two orders for power plants in South East Asia.
Waste heat recovery continued to be a big revenue earner during the year. Inlet
air cooling emerged as a new application area with exciting business potential.
Thermax bagged another waste to energy project to produce steam from the
high-moisture waste sludge of a grain based distillery.
Effluent treatment and water recycle project for a steel major reaffirmed
Thermax's expertise in this area, which is assuming growing importance in view
of the serious shortage of water that the country faces in many regions due to
increasing urbanisation and the declining quality of water.
Work on two of the key projects - waste heat recovery for a major refinery and
the augmentation of sewage treatment plant for a municipality - has made
substantial progress. Both projects will be commissioned in the first half of
this year.
The company continues to do reasonably well in the service business. Operation
& maintenance for captive power plants has emerged as a promising business
for the company; so did the retrofit and life extension services for boilers,
and increasingly for heaters. Energy audits for customers in process industries
continued.
During the year the company also introduced some product innovations to suit
the shifting trends of the market place to support customer efforts to tide
over essential resource crunch. A moving grate boiler in the packaged boiler
range was developed in response to the market requirement of keeping boiler
emissions low while benefiting from a shift to cheaper solid fuels. The company
also introduced several service products to improve energy efficiency at client
facilities.
The company is in trade terms with:
- Ashok Surfactants Private Limited
- Balaji Chemicals
- Davale Packing Contractors
- Gadia Industries
- Metal Arts
- National Engineers
- Chemi Flow Rubber Industries
- Arca Control Private Limited
- Annapurna Engineering and Manufacturing Private Limited
- Arem Engineering
- Arun Plast
- Autocon Engineering
- Blue Stone Enterprises
- Creative Mouldings
- Elcon Industries
- Elcon Instruments
- Elder Instruments
- Electro Fab
- Friends Engineers
- Guddi Plasticom
- Hercules Speciality
- Initiative Inc
- Jai Ganesh Enterprises
- K. J. Engineering Works
- K. K. Nag Limited
- Kalyani Marg
- Khandelwal Engineering
- Lebracs Rubber Lining
- Lokesh Auto
- Mangalam Enterprises
- Maruti Enterprises
The company has strategic alliances with the
following:
- Struthers
Wells, USA
- Kawasaki
Engineering, Japan
- Ecotec,
Canada
- Aqua-Chem,
USA
- Allied
Signals, USA
- Bloom Engineering, Germany
Fixed Assets
- Freehold Land
- Leasehold Land
- Buildings
- Plant and Machinery
- Machinery on Lease
- Electrical Installation
- Furniture
- Fixtures
- Computers
- Office Equipment
- Vehicles.
Website Details:
Profile:
Sustainable solutions in Energy and Environment
On this principle company has developed energy-efficient and
eco friendly solutions for industry and commerce. For over 3 decades, company
has been helping customers improve their processes, conserve energy, increase
their competitiveness and adhere to environmental norms.
Subject equipment helps several tens of thousands of
customers the world over enjoy increased profitability, and earn community
goodwill by:
- Maximizing energy efficiency and slashing operating costs
- Minimizing waste
- Recovering precious resource from waste
- Keeping pollutants out of the waters and the air
Compnay products and systems are in use in over 40 countries
over the world, supported through a network of subsidiaries, manufacturing
facilites and Sales and Service offices in 14 countries. Company main
operations are headquartered in India, with five manufacturing facilites, 12
sales and service offices and a widespread franchisee and dealer network.
Business Areas:
IN focus with the business mission; to provide Sustainable
solutions in Energy and Environment, company core business comprise 6 major
business areas.
- Boilers and Heaters
- Absorption Cooling
- Water and Waste Solutions
- Chemicals for Energy and Environment applications
- Power and Cogeneration systems
- Air Pollution and Purification
Company provides standard products in these 6 areas of
business. Drawing on decades of research and experience in process productivity
improvement and energy generation, Company also customizes integrated
sustainable solutions for the project requirements of a wide range of
industries.
Strategic Alliances
Company has sourced cutting-edge technologies for its
business operations through alliances with world technology majors, like
Babcock and Wilcox USA, Kawasaki Thermal Engineering Company, Japan; Eco Tech,
Canada; Honeywell, USA; Bloom Engineering, Germany; Struthers Wells and Ozone
Systems, USA.
BUSINESS
TCompnay is packaged boilers and
heaters, energy recovery systems and power boilers. This leadership position –
in India and overseas – has been acquired on the strength of their extensive
client base, deep experience, domain expertise and continuous innovation.
Company’s heating equipment serves industry in over 20 countries.
Compnay pioneered the vapour absorption
technology in India and continues to be the leader in this field. Vapour
absorption chillers fired on steam, hot water and oil/gas (direct) meet diverse
applications in industrial and commercial cooling. Company’s chillers are
exported to over 35 countries.
Chemicals:
Company offers resins and speciality chemicals that improve
processes and product performance. The range covers resins, polyelectrolytes,
oil well chemicals, boiler fireside cleaning compounds and cooling water
chemicals. Compnay exports resins to the US, Japan and other Asian countries.
Company has rich experience in
water/wastewater treatment and water recycles. The innovative and customised
solutions company offers have redefined conventional methods of treatment of
water and wastewater. It also addresses the safe disposal of toxic and
non-toxic wastes in liquid, solid and sludge form.
Company offers freedom from large power
stations through decentralised power solutions on a variety of fuels including biomass.
A EPC contractor, Company provides least cost, fast track and relevant captive
power and cogeneration solutions to industry.
Company is a key player in the field of
gaseous and particulate emission control. Keeping pace with international
trends, it offers turnkey solutions as well as pollution abatement products for
varied applications for a host of industries including power, steel, fertiliser
and chemicals.
PRESS RELEASE:
Q1
Results : Thermax net Rs.640.000 Millions
Pune:
May 21, 2008
Total
income crosses Rs.32000.000 Millions mark
Thermax Limited, a leader in energy and environment management, today presented
its audited financial results for fiscal 2007-08 announcing a 47 % increase in
income over the previous year to Rs.32460.000 Millions. Export income,
including deemed exports, showed an increase of 69 % to Rs.6780.000 Millions
(Rs.4010.000 Millions). The consolidated income of the group was 49 % higher at
Rs.35250.000 Millions compared Rs.23630.000 Millions in the previous year.
Profit after tax for 2007-08 was up 50 % at Rs.2810.000
Millions. Consolidated profit after tax for the year also rose 50 % to
Rs.2910.000 Millions. Consolidated earning per Rs.2/- share was
Rs.24.40 compared to Rs.16.26 in the previous year.
The company has announced a dividend of 400 % compared to 300 % in the previous
year.
In Q4 of 2007-08 income rose by 12 % to Rs.9350.000 Millions. Profit after tax
for the quarter was Rs.810.000 Millions, up 16 %. Consolidated income for the
quarter was Rs.10310.000 Millions
(Rs.8690.000 Millions) and consolidated net profit for the quarter was
Rs.830.000 Millions
(Rs.610.000 Millions).
The Thermax group order book stands at Rs.26370.000 Millions as on March 31,
2008 compared to Rs.31000.000 Millions in the previous year. Based on the
current order book scenario the company currently expects a lower rate of
growth in fiscal 2008-09.
About Thermax Limited
Thermax Limited, the Rs.32460.000 Millions (USD 809 million) leader in energy
and environment management, is one of the few companies in the world that
offers integrated, innovative solutions in the areas of trigeneration (heating,
cooling, power), water & waste management, air pollution control and
chemicals. The sustainable solutions Thermax develops for client companies are
environment-friendly and enable efficient deployment of energy and waster
sources. For more information visit www.thermaxindia.com
Thermax signs license agreement with Babcock & Wilcox for utility
boilers
Mumbai:
February 12, 2008
Thermax Limited and Babcock & Wilcox Power Generation Group, Inc. (B&W
PGG), USA, have recently signed a technical transfer license agreement that
grants Thermax the right to engineer, manufacture and sell subcritical B&W
Radiant utility boilers in India. The agreement was signed by Mr. M. S.
Unnikrishnan, Managing Director, Thermax Limited, and Mr. Brandon C. Bethards,
President & Chief Operating Officer, B&W PGG.
The boilers will be used to generate steam in thermal power plants, primarily
owned by independent power producers. The units can be designed to fire a
variety of fossil fuels including pulverized coal, fuel oil, natural gas and synthesis
gases such as blast furnace gas and coke oven gas. Through this agreement,
which covers a period of 15 years and boilers up to 800 MW in size, Thermax can
begin engineering and production of the units at its new manufacturing facility
in Gujarat.
Thermax and Babcock & Wilcox have had a business relationship for 20 years,
including a successful joint venture for industrial boilers and heat recovery
steam generators. The latest agreement will give Thermax the right to use
B&W PGG’s proven technology to make a significant impact in the private and
public power generation sector where an estimated 80,000 MW of capacity will be
added in the next five years.
“We are very happy to source this technology from the original Babcock &
Wilcox,” said Mr. Unnikrishnan. “The Babcock & Wilcox name stands for
quality and reliability. These are critical factors in India, and we are proud
to work closely with this global leader.”
“Babcock & Wilcox technology is backed by more than 140 years of
experience, and we have designed and supplied some of the largest, most
efficient steam generating systems in the world,” said Mr. Bethards. “We are
pleased to bring our leading technology to India through this agreement and we
look forward to continuing our strong relationship with Thermax to help meet
the country’s power needs.”
B&W utility boilers installed worldwide generate more than 300,000 MW of
electric power.
Thermax has 40 years of experience in designing and manufacturing a wide range
of boilers, heaters and heat recovery steam generating systems on a variety of
solid, liquid and gaseous fuels including biomass and wet distillery sludge. It
is also a leading EPC (engineer-procure-construct) supplier of captive power
and cogeneration plants in India.
About Thermax Limited
Thermax Limited, a leading company in energy and environment
management, is one of the few companies in the world that offers integrated,
innovative solutions in the areas of heating, cooling, power, water and waste
management, air pollution control and chemicals. The sustainable solutions
Thermax develops for client companies are environment-friendly and enable
efficient deployment of energy and water resources. For more information visit:
www.thermaxindia.com
About the Babcock & Wilcox Power
Generation Group, Inc.
The Babcock & Wilcox Power
Generation Group, Inc. (B&W PGG) is a major operating unit of The Babcock
& Wilcox Company, a wholly owned subsidiary of McDermott International,
Inc. B&W PGG is a world leader in the power generation industry and
designs, engineers, manufactures, services and constructs steam generating and
environmental equipment for utilities and industries worldwide. It is located
on the Internet at www.babcock.com.
For further information contact:
Ahmed Bunglowala
Email: abunglow@thermaxindia.com
Tel: 9823291825
Genesis Burson-Marsteller
Urvashi Kadam
Email: urvashi.kadam@bm.com
Tel: 9989590387
Anu Soman – 7
Email: anu.soman@bm.com
Tel: 9850837393
CMT REPORT
(Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources including
but not limited to: The Courts, India Prisons Service, Interpol, etc.
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist organization
or whom notice had been received that all financial transactions involving
their assets have been blocked or convicted, found guilty or against whom a
judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE
GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE
RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.45.44 |
|
UK Pound |
1 |
Rs.79.62 |
|
Euro |
1 |
Rs.63.48 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
8 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
8 |
|
--PROFITABILIRY |
1~10 |
8 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
8 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
72 |
This score serves as a reference to assess SC’s credit risk and
to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING
EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit transaction.
It has above average (strong) capability for payment of interest and
principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit consideration.
Capability to overcome financial difficulties seems comparatively below
average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
|