MIRA
INFORM REPORT
|
Report Date : |
18.09.2008 |
IDENTIFICATION
DETAILS
|
Name : |
ARVIND LIMITED |
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Formerly Known As : |
ARVIND MILLS LIMITED |
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Registered
Office : |
Railwaypura Post, Naroda Road, Ahmedabad –
380025, Gujarat |
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Country: |
India |
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Financials (as
on): |
31.03.2008 |
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Date of
Incorporation : |
01.06.1931 |
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Com. Reg. No.: |
04-93 |
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CIN No.: [Company Identification
No.] |
L17119GJ1931PLC000093 |
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TAN No.: [Tax Deduction & Collection Account No.] |
AHMT00462A |
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Legal Form : |
A Public Limited
Liability Company. The Company’s
Shares are Listed on the Stock Exchanges. |
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Line of
Business : |
Manufacturing and Marketing of Denim Fabric, Shirting
Fabric, Shirts, Knitted Fabric and Garments. |
RATING &
COMMENTS
|
MIRA’s Rating
: |
Aa |
RATING |
STATUS |
PROPOSED
CREDIT LINE |
|
|
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 74000000 |
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|
Status : |
Excellent |
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Payment
Behaviour : |
Usually Correct |
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Litigation : |
Clear |
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Comments : |
Subject is the
flagship company of the Lalbhai Group manufacturing marketing cloth, Grey
Knitted Fabrics Yarn. Directors are respectable
renowned industrialists. Trade relations are fair. Payments are correct as
per commitments. The company can
be considered normal for business dealings at usual trade terms conditions. |
LOCATIONS
|
Registered
Office : |
Railwaypura Post, Naroda Road, Ahmedabad –
380 025, Gujarat, India. |
|
Tel. No.: |
91-79-22121408 /
22203030 / 22200206 |
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Fax No.: |
91-79-22124314 /
22120267/ 22371396 / 22372342 / 22379184 / 22201608/ 22201270 |
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E-Mail : |
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Website : |
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Factory : |
Tel. No. 91-79-22121408/ 2377002 Fax No. 91-79-22124314/ 22120267/ 22371396/ 22372342/ 22379184
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Branch Office
: |
MUMBAI Neptune House, 2nd Floor, Opp. Bandra Talkies, SV Road,
Mumbai – 400050, Maharashtra, India DELHI 8 Community Centre, Saket, New Delhi– 110017, India BANGALORE Grace Mansion, 25 Infantry Road, Bangalore – 560001, Karnataka KOLKATA 100, Park Street, Laxmi Nivas, 2nd Floor, Kolkata , West
Bengal, India
USA Arvind Worldwide (USA) Inc., 130, West 42nd Street, Suite
No. 603, 6th floor, NY 10036, New York, USA SRI LANKA Sri Lanka Liason Office BANGLADESH C/o Sidko Limited.
Asoka Spintex Premises, Naroda Road,
Ahmedabad – 380025, Gujarat |
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Other Division
: |
Santej Road, Near Khatrej, Taluka Kalol, Dist Gandhinagar - 382721 Khakhi
Division Knits Division Santej Road, Near Khatrej, Taluka Kalol, Dist Gandhinagar - 382721 Ankur Textiles Arvind
Brands Limited Du Parc Trinity 8th Floor, 17, M. G. Road,Bangalore – 560001, Karnataka, India Tel: 91-80-22973131 Denim Division Tel: 91-79-22203030 |
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Garment Export
Division : |
10th Floor, Du Parc Trinity, 17 MG Road, Bangalore -560001, Karnataka,
India |
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Tel No.: |
91-80-251123900/5 |
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Fax No.: |
91-80-251123909 |
International Offices
DIRECTORS
|
Name: |
Mr. Arvind N. Lalbhai |
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Designation: |
Chairman |
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Age: |
84 Years |
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Qualification: |
Science Graduate |
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Date of
Joining: |
March, 1974 |
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Other Directorship: |
Ø Arvind Products Limited – Chairman Ø Atul Limited – Chairman Ø Birla VXL Limited – Director Ø JK Industries Limited – Director Ø Lokprakashan Limited – Director |
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Name: |
Mr. Sanjay S. Lalbhai
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Designation: |
Managing Director |
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Age: |
51 Years |
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Qualification: |
Science Graduate, Master’s Degree in Business Management |
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Date of
Joining: |
March, 1977 |
|
Other
Directorship: |
Ø
Arvind Spinning Limited, Mauritius Ø
Arvind Clothing Limited – Director Ø Arvind Fashions Limited – Director Ø Arvind Brands Limited – Director Ø Arvind Products Limited – Director Ø Amtrex Hitachi Appliances Limited – Chairman Ø Anagram Wellington Asset Management Company Limited – Director Ø Anagram Housing Finance Limited – Director Ø H. K. Finechem Limited – Director Ø Amol Dicalit Limited – Director Ø Gujarat Infrastructure Limited – Director Ø Mahindra Gujarat Tractor Limited - Chairman |
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Name: |
Mr. Jayesh K. Shah
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|
Designation: |
Director Chief Financial Officer |
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Age: |
44 years |
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Qualification: |
Commerce Graduate Chartered Accountant |
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Date of
Joining: |
01.07.1993 |
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Other Directorship: |
Ø Asman Investments Limited Ø Lifestyle Fabrics Limited Ø Arvind Spinning Limited, Mauritius Ø Arya Omnitalk Wireless Solutions Limited Ø Anagram Stockbroking Limited Ø Anagram Comtrade Limited Ø Anagram Securities Limited Ø Dropadi Finance Limited Ø e-Infochips Limited Ø Firenze Properties & Investments Private Limited Ø Arvind Murjani Brands Private Limited |
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|
Name: |
Mr. G. M. Yaswadkar
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Designation: |
Director (Nominated by IDBI Bank Limited”) |
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Name: |
Mr. Mukesh Khanna |
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Designation: |
Non Executive and Independent Director |
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Qualification
: |
Chartered Accountant |
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Experience : |
21 years |
|
Other
Directorship: |
Ø
Anagram Securities Limited Ø
Indofil Organic Industries Limited Ø
Caption Investments & Trading Company Private
Limited |
|
Profile : |
Mr. Munesh Khanna is a
Non-executive & Independent Director of the Company. He is a Chartered Accountant
from ICAI. He has 21 years of experience in Investment Banking from across
the Industrial spectrum in India in the areas of M&A, Financial
Restructuring and Resource Raising. He has also an extensive experience in
the Energy, Utilities and Telecom Sectors. Prior to joining Halcyon Resources
& Mgt. Consulting Private Limited, he was the MD & Head of Investment
Banking in DSP Merrill Lynch. He was the Country Head and MD of Rothschild
India and Partner- Country Head of Arthur Andersen Corporate Finance. He has
advised Indian Lenders on the Restructuring of the Dabhol Power Project and
LNG facility for a total value of US$ 1.9 billion. AXA on its joint venture
with Bharati Group, Air Deccan on rising funds US$ 40m through Private
Equity, IPO and many other significant transactions. He was also a Member of
CII and a member of the Executive Committee of ‘FICCI’ and Co - Chairman of
the Finance & Capital Market committee of FICCI. |
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Name : |
Mr. K M Jayarao |
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Designation : |
Nominee by ICICI Bank Limited |
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|
Name : |
Mr. Sudhir Mehta |
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Designation : |
Director |
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|
Name : |
Mr. Tarun Sheth |
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Designation : |
Director |
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|
Name : |
Mr. S. R. Rao |
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Designation : |
Director (Nominee by Export Import Bank of India) |
KEY EXECUTIVES
|
Name : |
Mr. R V Bhimani |
|
Designation : |
Company Secretary |
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Address : |
Secretarial Department, Naroda Road, Ahmedabad – 380 025, Gujarat,
India |
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Tel. No.: |
91-79-22203030/ 22200206 |
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Fax No. : |
91-79-22201608 |
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Email : |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
(As on
30.06.2008)
|
Names
of Shareholders |
No. of Shares |
Percentage of Holding |
|
|
|
|
|
Shareholding
of Promoter Promoter Group |
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|
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Indian
|
|
|
|
Individuals / Hindu Undivided Family |
264788 |
0.12 |
|
Bodies Corporate |
76514780 |
34.94 |
|
Total |
76779568 |
35.06 |
|
|
|
|
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Public
shareholding |
|
|
|
Institutions |
|
|
|
Mutual
Funds / Axis |
12456220 |
5.69 |
|
Financial
Institutions/Banks |
1782785 |
0.81 |
|
Insurance
Companies |
19350071 |
8.84 |
|
Foreign
Institutional Investors |
14074336 |
6.43 |
|
Any
Other(specify)Foreign Banks/IFCW |
1213 |
0.00 |
|
Total
|
47664625 |
21.77 |
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|
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Non-Institutions |
|
|
|
Bodies
Corporate |
18205866 |
8.32 |
|
Individuals - |
0 |
0 |
|
Individual
shareholders holding nominal share capital up to Rs.0.100 million. |
61761446 |
28.20 |
|
Individual
shareholders holding nominal share capital in excess of Rs. 0.100 million. |
11962515 |
5.46 |
|
Any
Other (specify) NRIs/OCBs |
1852779 |
0.85 |
|
Total
|
93782606 |
42.83 |
|
|
|
|
|
Shares
held by Custodians against which Depository Receipts have been issued. |
750742 |
0.34 |
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|
|
|
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GROUND TOTAL |
218977541 |
100.00 |
BUSINESS DETAILS
|
Line of
Business : |
Manufacturing and Marketing of Denim Fabric, Shirting
Fabric, Shirts, Knitted Fabric and Garments. |
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Products : |
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|
Brand Name : |
v
Newport v
Flying Machine v
Excalibre v
Ruf & Tuf |
PRODUCTION STATUS
|
Particulars |
Unit |
Actual
Production (Quantity
in crores) |
|
Cloth |
Meters |
10.78 |
|
Cloth |
Kgs. |
0.15 |
|
Yarn |
Kgs. |
0.43 |
|
EPBAX |
Lines |
0.01 |
|
Garments |
Nos. |
1.34 |
|
Yarn @ |
Kgs. |
0.16 |
|
Grey @ |
Meters |
0.06 |
|
Grey @ |
Kgs. |
0.01 |
|
Particulars |
Installed
Capacity |
|
Spindles |
106776 |
|
Rotors |
7824 |
|
Stitching Machines |
678 |
|
Knitting Machines |
105 |
|
Looms |
1040 |
|
EPBAX / RAX System Lines |
200000 |
|
Garments (Pcs.) |
8620000 |
GENERAL
INFORMATION
|
No. of
Employees : |
Around 6000 |
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Bankers : |
v State Bank of Saurashtra, Ahmedabad, Gujarat v State Bank of India, Ahmedabad, Gujarat v Bank of Baroda, Ahmedabad, Gujarat v UCO Bank, Ahmedabad, Gujarat v State Bank of Patiala, Ahmedabad, Gujarat v Credit Lyonnais, Ahmedabad, Gujarat v Deutsche Bank, Ahmedabad, Gujarat v HDFC Bank, Ahmedabad, Gujarat v The Bank of Nova Scotia, Ahmedabad, Gujarat v Standard Chartered Grindlays Bank, Ahmedabad, Gujarat v Bank of America, Ahmedabad, Gujarat v ICICI Bank Limited, Ahmedabad, Gujarat v Calyon Bank v Export Import Bank of India v Axis Bank v ABN Amro Bank NV v State Bank of Hyderabad |
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Facilities : |
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Banking Relations : |
Satisfactory |
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Auditors : |
Sorab S. Engineer
Company Chartered
Accountants |
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Address : |
381, Dr. D. Naoroji
Road, Fort, Mumbai - 400 023, Maharashtra, India |
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|
|
|
Associates : |
v Anup Engineering Limited Engaged in manufacturing of equipments for chemical, petrochemical, pharmaceutical, fertilizer, dairy allied industries. v Lalbhai Realty Limited Engaged in real estate business v Amtrex Appliances Limited Engaged in manufacturing of room air conditioner. It has technical collaboration with Hitachi, Japan. v Arvind Intex Limited v Anagram Finance Limited v Arvind Polycot Limited v Atul Products Limited v Amtrex Appliances Limited v Lalbhai Exports Limited |
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|
|
|
Subsidiaries : |
v
Asman Investments Limited v
Arvind Products Limited v
Arvind Brands Limited v
Arvind Clothing Limited v
Arvind Fashions Limited v
Asman Investments Limited v
Lifestyle Fabrics Limited v
Omnitalk Wireless Solutions Limited v
Syntel Telecom Limited v
Arvind Worldwide Inc. USA v
Arvind Worldwide (M) Inc., Mauritius v
Arvind Overseas (M) Limited, Mauritius v
Big Mill Lauffenmuhle GmbH, Germany v Arvind Spinning Limited |
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Joint Ventures
: |
v Arya Omnitalk Wireless Solutions Limited v Arvind Murjani Brands Private Limited v VF Arvind Branda Private Limited v Diesel Fashion India Arvind Private Limited |
CAPITAL STRUCTURE
(As on 31.03.2008)
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
360000000 |
Equity Shares |
Rs.10/- each |
Rs.3600.000
Millions |
|
9000000 |
Preference Shares |
Rs.100/- each |
Rs.900.000
Millions |
|
|
|
|
|
|
|
Total |
|
Rs.4500.000 Millions |
Issued & Subscribed Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
218978441 |
Equity Shares |
Rs.10/- each |
Rs.2189.784 Millions |
|
6950000 |
Preference Shares |
Rs.100/- each |
Rs.695.000 Millions |
|
|
|
|
|
|
|
Total |
|
Rs.2884.784 Millions |
Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
218977541 |
Equity Shares |
Rs.10/- each |
Rs.2189.775 Millions |
|
41000000 |
Warrants |
Rs.5.2/- each |
Rs.213.200 Millions |
|
3300000 |
Preference Shares |
Rs.100/- each |
Rs.330.000 Millions |
|
|
|
|
|
|
|
Total |
|
Rs.2733.000 Millions |
FINANCIAL DATA
[all figures are in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES
OF FUNDS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
|
SHAREHOLDERS
FUNDS |
|
|
|
|
|
1] Share Capital |
2733.000 |
2555.800 |
2654.800 |
|
|
2] Reserves &
Surplus |
11970.500 |
11314.500 |
12664.700 |
|
NETWORTH
|
14703.500 |
13870.300 |
15319.500 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
17704.700 |
17670.700 |
16883.800 |
|
|
2] Unsecured
Loans |
975.200 |
1615.700 |
1529.900 |
|
TOTAL BORROWING
|
18679.900 |
19286.400 |
18413.700 |
|
|
DEFERRED TAX LIABILITIES |
128.200 |
128.200 |
0.000 |
|
Non Convertible Debentures
|
44.700 |
56.700 |
0.000 |
|
|
|
|
|
|
|
TOTAL
|
33556.300 |
33341.600 |
33733.200 |
|
|
|
|
|
|
|
APPLICATION OF FUNDS
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block]
|
20362.100 |
20448.900 |
13096.000 |
|
Capital work-in-progress
|
1161.400 |
714.500 |
795.900 |
|
|
|
|
|
|
|
INVESTMENT
|
1049.900 |
480.500 |
3481.000 |
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES
|
|
|
|
|
|
|
Inventories
|
5753.400
|
6450.100
|
4792.600
|
|
|
Sundry Debtors
|
2617.700
|
2048.500
|
3682.800
|
|
|
Cash & Bank Balances
|
163.200
|
223.100
|
95.900
|
|
|
Other Current Assets
|
732.600
|
549.500
|
0.000
|
|
|
Loans & Advances
|
5444.500
|
6959.800
|
12286.400
|
Total Current Assets
|
14711.400
|
16231.000
|
20857.700
|
|
Less : CURRENT LIABILITIES & PROVISIONS
|
|
|
|
|
|
|
Current Liabilities
|
3605.400
|
4089.900
|
4046.500
|
|
|
Provisions
|
218.100
|
443.400
|
450.900
|
Total Current Liabilities
|
3823.500
|
4533.300
|
4497.400
|
|
Net Current Assets
|
10887.900
|
11697.700
|
16360.300
|
|
|
|
|
|
|
|
TOTAL
|
33556.300 |
33341.600 |
33733.200 |
|
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
||
|
Sales Turnover |
22712.700 |
18449.100 |
15886.900 |
||
|
Other Income |
164.500 |
162.500 |
119.800 |
||
|
Total Income |
22877.200 |
18611.600 |
16006.700 |
||
|
|
|
|
|
||
Profit/(Loss) Before Tax
|
296.100 |
277.100 |
1363.800 |
||
Provision for Taxation
|
22.500 |
24.400 |
92.200 |
||
Profit/(Loss) After Tax
|
273.600 |
252.700 |
1271.600 |
||
|
|
|
|
|
||
|
Expenditures : |
|
|
|
||
|
|
Cost of Goods Sold |
5771.300 |
5719.300 |
|
|
|
|
Manufacturing Expenses |
5934.400 |
5292.400 |
|
|
|
|
Administrative Expenses |
1150.600 |
958.900 |
|
|
|
|
Purchases made for re-sale |
3055.400 |
369.700 |
|
|
|
|
Increase/(Decrease) in Finished Goods |
(94.900) |
(536.400) |
|
|
|
|
Salaries, Wages, Bonus, etc. |
2308.200 |
2014.700 |
14642.900 |
|
|
|
Managerial Remuneration |
25.800 |
28.600 |
|
|
|
|
Payment to Auditors |
12.300 |
9.700 |
|
|
|
|
Interest |
1314.000 |
1502.600 |
|
|
|
|
Depreciation & Amortization |
1366.400 |
1433.600 |
|
|
|
|
Other Expenditure |
1737.600 |
1541.400 |
|
|
Total Expenditure
|
22581.100 |
18334.500 |
14642.900 |
||
QUARTERLY RESULTS
|
PARTICULARS |
|
|
30.06.2008 |
|
Type
|
|
|
1st Quarter |
|
Sales Turnover |
|
|
5454.200 |
|
Other Income |
|
|
124.800 |
|
Total Income |
|
|
5579.000 |
|
Total Expenditure |
|
|
4921.600 |
|
Operating Profit |
|
|
657.400 |
|
Interest |
|
|
322.100 |
|
Gross Profit |
|
|
335.300 |
|
Depreciation |
|
|
294.300 |
|
Tax |
|
|
2.600 |
|
Reported PAT |
|
|
38.400 |
KEY RATIOS
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
Debt Equity Ratio |
1.37 |
1.30 |
1.25 |
|
Long Term Debt Equity Ratio |
0.92 |
0.48 |
0.84 |
|
Current Ratio |
1.45 |
1.13 |
1.94 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
0.76 |
0.88 |
0.75 |
|
Inventory |
3.58 |
3.28 |
3.28 |
|
Debtors |
9.36 |
6.44 |
4.72 |
|
Interest Cover Ratio |
1.20 |
1.18 |
2.02 |
|
Operating Profit Margin (%) |
16.03 |
17.42 |
26.18 |
|
Profit Before Interest Tax Margin (%) |
9.77 |
9.65 |
16.63 |
|
Cash Profit Margin (%) |
7.78 |
9.14 |
17.39 |
|
Adjusted Net Profit Margin (%) |
1.52 |
1.37 |
7.83 |
|
Return on Capital Employed (%) |
6.48 |
5.34 |
8.52 |
|
Return on Net Worth (%) |
2.26 |
1.81 |
9.17 |
LOCAL AGENCY FURTHER
INFORMATION
The company was
incorporated on 1st June, 1931 at Ahmedabad in Gujarat having
Company Registration Number 93.
Subject is the
flagship company of Lalbhai Group, which was incorporated to manufacture cotton
textiles.
Subject for long
has been one of the leading cotton manufacturing companies in the country
producing conventional suiting fabrics, shirting fabrics sarees had moved into
denim manufacturing in 1980's.
Subject has a wide
product range, which includes Suitings, Shirtings, Sarees Dress Materials has
diversified into Denim manufacture is the 5th largest denim
manufacturer in the world.
Subject has tie-ups
with H I Lee Cluett International, USA to manufacture denim jeans Arrow shirts
respectively.
The denim project went
on stream in 1991.
Subject's recent
tie-ups include its technical marketing alliance with F M Hammerie
Von-Ogensever Waltungs, Australia, the USA based Alamac Knit Fabrics Spinners
Webexi Dict Turt, Switzerland. Other
brportfolio are Flying Machine, Ruggers, Newport, Ruf-and-Tuf, Excalibur, etc.
During 1985 the
company diversified into electronics by setting up a plant to manufacture
electronic telephone exchanges (EPABX). It also entered into marketing
pharmaceutical products B&W colour television sets under the name
Pyramid. Rohit Mills, a sick textile
unit was merged with the company with effect from 1st November, 1996
renamed Asoka Cotsyn division. The
company now proposes to merge Arvind Intex, a subsidiary company engaged in cotton
spinning activities, in which it holds a stake of 49.89%.
The company had
also ventured into production of video magnetic tape of VHS Standards in
1988. In this regard, the company had
signed an agreement with Victor Company of Japan for technical assistance
licence for production marketing of videotapes.
The company has
taken over the management of Nagri Mills Company Limited proposed to modernize
the existing capacity.
The green field
textile project at village Santej with a capacity of processing 34 million
meters per annum had commenced commercial production with effect from 1st
April, 1999. It also started operating two captive Co-generation Power plants
after test runs in the 2nd 3rd quarter of 1998-99.
The company commissioned
its' shirtings facility at Santej during the first quarter of 2000 the Knits
facility was commissioned in the third quarter of 2000.
The company was
also planning a rights issue sale of non-core assets if lenders agree to the
restructuring proposal prepared by KSA Techno Pak, an Indo-US consultant
Jardine Fleming, now Chase Jardine Fleming.
It intends to raise
Rs.1000 millions through the rights issue Rs.750 millions through sale of
assets, mostly real estate. The money would be used to buy back debt. The
restructuring proposal is strictly subject to the lenders agreeing to sell back
a minimum of Rs.5500 millions debt the company would raise new debt to
part-finance the buyback.
HISTORY
Subject is the largest cotton textiles manufacturer and
exporter in India. They are the leading player in the branded garments in the
domestic market. The company's principal business consists of manufacturing and
marketing of Denim Fabric, Shirting Fabric, Shrits, Knitted Fabric and
Garments. The company having the rights to market international brands such as
Lee, wrangler, Arrow and Tommy Hilfiger in India. The company has also owns
popular brands such as Newport, Flying Machine, Excalibre and Ruf & Tuf.
They are having their production facilities at Ahmedabad, Mehsana, Gandhinagar
in Gujarat, Pune in Maharashtra and Bangalore in Karnataka.
Subject was incorporated in the year 1931 as Arvind Mills Ltd by three brothers
Kasturbhai, Narottambhai and Chimanbhai. In the year 1934, they established themselves
amongst the foremost textile units in the country. They are first company to
bring globally accepted fabrics such as Denim, yarn dyed shriting fabrics &
wrinkle free gaberdines to India in the year 1986.
In the year 1987, they started retail outlets for 'Arrow' brand and became the
first company to bring international shrit brand 'Arrow' to India. The company
joint venture includes their technical and marketing alliance with F M Hammerie
Von-Ogensver Waltungs, Austria, the US based Alamac Knit Fabrics & Spinners
and Webexi Dict Turt, Switzerland. Company in 1985 has diversified into
electronics by setting up a plant to manufacture electronic telephone exchanges
(EPABX). They also entered into marketing pharmaceutical products and B&W
and colour television sets under the name Pyramid.
During the year 2001-02, the compnay increased the number of Spindles and
Stitching Machines by 2036 Nos and 38 Nos respectively. In the next year, they
further increased the number of Stitching machines by 7 Nos. During the year
2003-04, the company expanded their shirts manufacturing capacity from 2.4
million pieces to 4.8 million pieces per annum. During the same year, their
subsidiary company, Arvind Spinning Limited commenced their operation.
In March 2005, the company commenced their operations of producing Jeans Pant
in Bangalore with the installed capacity of 4 million Pcs per annum. During the
year 2005-06, new Denim collection was launched which was aimed at the Super
Premium brands of the USA, Europe, Japan & Korea. The response to this
collection was good and they have opened new venues for the Denim
division.
The company demerged and transfered the Garments Business Division of their
100% subsidiary company, Arvind Brands Limited and amalgamate Arvind Fashions
Ltd, a 100% subsidiary of Arvind Brands Limited with them with effect from
April 1, 2006. Also The Company has a joint venture company namely Arvind
Murjani Brand Private Limited, through which they hold license to sell Tommy
Hilfiger brand apparel in India.
The operations of Arvind Brands Limited and their subsidiaries were merged with
the Company with effect from April 1, 2006. The wholesale branded apparel
business of Arvind Fashions Limited has been sold to VF Arvind Brands Private
Limited with effect from August 31, 2006.
In March 2008, the company signed a exclusive license agreement with The
Philips-Van Heusen Corporation for designing, distribution and reatiling of
IZOD brand apparels in India. From May 2008, the company name was changed from
Arvind Mills Limited to Company.
OPERATIONS
The Directors are pleased to inform that the company has been able steer through financial year 2007-08, which was another challenging year, The company continues to operate the denim capacities at lower utilization level and has In fact shut down one of the manufacturing units and also had to face the rapidly rising energy cost as the gas supply agreement ended in November 2007. The impact of the factors is visible in the results. Even though the turnover went up by 23%, the operational earnings increased merely by 7%.
The company has registered a Net Profit after Extra-ordinary Items of
Rs.270.000 Millions compared to 1200.000 Millions in the previous financial
year, a drop of 77%.
A detailed analysis of the financial results is given in the Management
Discussion and Analysis Report which forms part of this report.
The company during the year laid out the strategy of transforming itself from
being a fabrics and apparel solutions company to a diversified business group
with focus on branded apparels aid retailing. Over the last eight decades,
ability of the company to understand change and willingness to evolve has
helped it to change the face of fashion itself. Today, as they enter an exciting
new world of opportunities, the company has gone through a new phase in its
evolution to address the aspirations of its stakeholders. To reflect the new
focus the company has changed its name from 'The Arvind Mills Limited' to
'Arvind Limited' and launched a new brand identity.
FINANCE
During the year, the company has repaid the installments of Term Loans amounting to Rs.1650.000 Millions falling due during the current year. The Company has also made fresh borrowings of Rs.810.000 Millions for funding capital expenditure and other requirements. Long Term Debt including lease of the company stands to Rs.11720.000 Millions as on 31st March, 2008.
SUBSIDIARIES
A detailed discussion on subsidiary companies and their performance during the year is contained In the Management Discussion and Analysis Report which forms part of this Report.
Pursuant to Accounting Standard AS-21 Issued by the Institute of Chartered
Accountants of India the Company has prepared Consolidated Financial Statements
of the Company and its subsidiaries are included in the Annual Report.
In view of die closure of business and disposal of the business undertaking,
the accounts of Arvind Overseas (Mauritius) limited, Arvind Spinning Limited
and Lifestyle Fabrics Limited, have not been prepared on the going on concern
basis. Aakar Foundationwear Limited and Arvind Textile Mills Limited have not
commenced their businesses; hence, the accounts of these subsidiary companies
have not been consolidated with accounts of the company as per the provisions
of the Accounting Standard 21 relating to consolidation of accounts.
CORPORATE GOVERNANCE
The Company is committed to the tenets of good Corporate Governance and has
taken adequate steps to ensure that the requirements of Corporate Governance as
laid down in Clause 49 of the Listing Agreement are complied with.
A separate report on Corporate Governance and a Management Discussion and
Analysis Report are being published as a part of the Annual Report of the
Company.
The Auditors of the Company have certified that conditions of Corporate
Governance as stipulated under Clause 49 of the Listing Agreement are complied
by the Company and their Certificate is annexed to the Report on Corporate
Governance.
UNCLAIMED
DIVIDEND
Pursuant to Section 205A of the Companies Act, 1956,
unclaimed dividends upto and including the financial years 1993-1994 have been
transferred to the General Revenue Account of the Central Government.
Shareholders who have not encashed their dividend warrants relating to any
financial year upto 1993-1994 are requested to claim the amounts from the
Registrar of Companies, Gujarat, ROC Bhavan, Near Ankur Bus Stand, Naranpura,
Ahmedabad 380 013 in the prescribed form. Investors may write to the Secretarial
Department of the Company or the Registrars and Transfer Agents for a copy of
the form.
Pursuant to the provisions of Section 205(5) of the
Companies Act, 1956, dividends on equity shares for the financial years 1994-95
to 1997-98 which were remained unclaimed for a period of 7 years from their due
dates have been transferred by the Company to the Investor Education and
Protection Fund (IEPF) established by the Central Government pursuant to
Section 205C of the Companies Act, 1956. Shareholders are requested to note
that no claims shall lie against the said Fund or the Company in respect of any
amounts which were unclaimed and unpaid for a period of seven years from the
dates that they first became due for payment and no payment shall be made in
respect of any such claims.
The Company did not declare any dividends on equity shares
for the financial years 1998-99 to 2003-04.
MANAGEMENT
DISCUSSION & ANALYSIS:
OVERVIEW:
2007-2008 has been a year of mixed bag for the company. While the company
achieved significant part of the goals set out for the year, macro economic
factors have continued to affect the business adversely.
The company continues to focus on the strategic efforts initiated in the
previous financial year towards long term stability. In the current year
company has made rapid strides in the branded apparel business and retail
business of the company. The year also saw strategic cutback in the fabric
manufacturing capacities.
Reflecting the shift in the company focus from traditional business of textile
to diversified value added player the company changed its name from 'The Arvind
Mills Limited' to 'Arvind Limited' and launched a new brand identity and
logo.
OPERATING
ENVIRONMENT:
The Company operates across multiple products and businesses in diverse markets
and environments. These include the Indian retail market for its branded
apparel business as well as value retail operations under 'Mega Mart' umbrella,
the Indian intermediary market for fabrics, Indian brands and third party
converters for its fabrics and apparels and the global market for the fabrics
and apparel business.
INDIAN
INTERMEDIARY MARKET:
The demand in the domestic market continues to grow at robust pace on back of
growing economy. However there exist substantial excess capacity across product
groups due to huge capacity creation in anticipation of growth, with the export
market weakening, the players are also diverting production meant for export to
Indian markets. The situation is acute in the denim and Khakis product group
with almost 100% over capacity and with quite a few new capacities coming up in
the current year shirting fabric will also soon face the supply glut.
The company in response to this situation has strategically reduced capacity
producing commodity products and thus reducing the fixed operating cost. The
company is focused on delivering value added products and services where the
margins are better. The company is focusing on building unique product and
delivery capabilities to maintain distinctive competitive advantage and current
year would see launch of such initiatives.
EXPORT
MARKET:
Global trade in apparel and textile for 2006 was estimated to be at US$ 311
billion and growing at pace of 12% up from 6.5% from the previous financial
year. The growth figure for 2007 is estimated to be lower. The value of US
imports in apparel and textile space was US$ 96 billion of which apparel alone
contributed US$74 billion. In the global apparel and textile s export market
65% share is controlled by China alone and with India coming a distant 8th
position. Interestingly India occupies a safe second position at 15% of global
textile and apparel production behind 50% share of China, indicating a very
robust domestic market. Despite reports of an economic slowdown and a
'Hesitation Holiday,' the U.S. apparel market posted growth this past year.
According to The NPD Group, Inc., leading provider of consumer and retail
information, 2007 dollar volume sales were $195.6 billion, up 3% over the prior
year. The 2008 though has not begun on positive note with the total import into
USA in the first three months of 2008 has fallen by 4% with Mexico bearing the
maximum brunt followed by Sri Lanka, Philippines and China. Indian and
Bangladesh imports have relatively done well and in fact have grown by about
4.5% and 5% respectively. Vietnam is fast emerging as a credible sourcing
destination and has grown its exports into US by astounding 29%.
Cotton fabrics and apparel is the primary space in which the company operates
and the one of the best ways to track the growth could be to track the global
consumption of cotton. The cotton consumption for the year is estimated to
remain flat at 26.70 Million Metric tons. A possible inter pretation could be
that globally the cotton apparel and textile markets could see a flat growth in
volumes and possibly some improvements in the value. In spite of this situation
the cotton prices are at five year highs on back of rapid rise in the global
commodity prices. A direct impact of this is being reflected in the global
trade. US import of cotton apparel though has fallen by 4% in line with the
trend but volumes from China which is a net importer of cotton has fallen by
sharper 11% and the value of imports from Mexico has dropped by 14%. India in
spite of being surplus on cotton has not been able to capitalize on the
situation and has grown business merely by 3%.
According to the statistics from China Customs, China's textile and apparel
exports for 2007 totaled US$171 billion, an increase of 19% as compared with
the corresponding period of last year. Among such exports, textiles and
apparels exports amounted to US$56 billion and US$115 billion respectively,
grew by 15% and 21% as compared with the corresponding period of last year. In
2007, China's exports to 4 markets (the EU, the US, Japan and Hong Kong)
amounted to US$91 billion in aggregate, accounting for 53% of the total textile
export value, among which exports to the EU amounted to US$28 billion with a
decrease of 2%, exports to the US amounted to US$25 billion with a growth of
14%, exports to Japan amounted to US$20 billion with an increase of 4%, and
exports to Hong Kong amounted to US$18 billion with a growth of 1%.
The biggest opportunity that could lie ahead is the relative weakening of
Chinese competition. Chinese government has adjusted the tax rebates policy for
exports which lowered the rebate rate for textile exports from 13% to 11% of
2442 items have been put on trade exports restriction list including textile.
It is expected that the Chinese government will further accelerate the change
in the components of foreign trade in 2008, with an aim to redress the
imbalance of the balance of payments. Measures to be taken include tough
restrictions on the export of energy-consuming and highly polluted resource
products. After six interest rises in 2007, the one-year loan interest rate of
China has already rose to 7.47%, leading to the continuous increase in finance cost
of Chinese enterprises.
INDIAN RETAIL MARKET:
The estimated size of Indian retail market is about US$280 billion of which
apparel forms about 7% of this market estimated at US$19 billion. Whereas the
organized retail which is the customer and market space the company operates in
is only a miniscule US$14 billion or 5%. Within the apparel market space the
share of menswear which is the largest customer base of the company both as
customers for fabrics as well as end consumers of branded apparel is estimated
to be about US$7.92 billion. Compared to overall average, the organized retail
penetration in apparel is relatively higher at almost 12%. The organized retail
penetration though high in the urban area is still at nascent stage in the Tier
II and III cities. If we breakdown the organized retail, apparel forms the
largest chunk at 39% of the total market and the next nearest being electronics
at 10%.
Whereas the overall apparel retail market is growing at an estimated rate of
13% the pie of organized retail is expected to grow at over 25%-30% per annum.
Organized retail is likely to account for 25% to 30% of the total retail
markets in next ten years. The prospering economy in the last decade has
increased the number of upper middle class and middle class households by 158%
and 62.5% respectively, increasing the overall purchasing power
considerably.
The retail revolution is also being aided by the rapid growth in availability
of quality retails space. The year under review has seen astronomical growth in
the mall space from 5.4 Million sq. ft. to 8.8 Million sq. ft. in one year.
Even this rate of growth has not been in commensurate with the requirement and
rentals had headed north steeply. With the supply finally catching up with
demand and the rentals returning to reasonable rates the organized retail is
expected to grow even faster.
The unorganized sector is continuously being squeezed by the value conscious
branded apparel and the private labels. Branded apparel companies exploit the
brand equity of their products coupled with scale of operations and deliver a
better product to the end consumer and managing better margins at the same
time. Around 125 key brands have collectively grown at 35% to 40% while many
smaller players have suffered negative growth.
The future demand for the branded apparel and resultant growth for apparel
retail players is expected to be robust due to varied factors but important
among them being:
- Shift in demographic profile
- Exponential growth in organized retail
- Clothing still holding lion's share of organized retail pie
In summary even though there may be some growth dampening in the coming
financial year due to rapidly rising inflation and a general recession in the
developed world, the growth story remains intact and the fundamentals of the
market is likely keep the wagon wheels of organized apparel retail moving
faster.
RESULT
REVIEW:
Revenue of the Company, for the year ended 31st March 2008, was Rs.22710.000 Millions.
This represents an increase of 23% over the revenue of Rs.18480.000 Millions
for the previous financial year. The operating profit for the year ended 31st
March 2007 stood at Rs.3040.000 Millions as against Rs.3210.000 Millions in the
previous financial year, representing a drop of 5%. There is an exceptional
item of loss as the company based on principle of prudence & in conformity
with the announcement made by the Institute of Chartered Accountants of India,
has provided for the loss of Rs.125.600 Millions on the foreign exchange
derivatives entered into by the Company and outstanding on the balance sheet
date, on account of marking these derivatives to market (MTM). Also during the
year the Company has introduced Voluntary Retirement Scheme for certain
category of employees and the expenses incurred on account of this has been
amortized up to 31st March 2010 & recognized as exceptional items in
accordance with Accounting Standard 15 (Revised). The exceptional item also
includes an income on account of provision no longer required of Rs.81.000
Millions. The profit after tax and extra ordinary items stood at Rs.270.000
Millions compared to Rs.1200.000 Millions in the previous financial year,
representing a drop of 77%.
SALES & OPERATING INCOME:
Business revenue from the fabric business is unchanged compared to previous
year primarily due to lower denim volumes. Revenues from the apparel exports
business grew by 40% on account of full year operation numbers of the Jeans
plant. The revenue of Arvind Brands for the year ended 31st March 2008 was at
Rs.4850.000 Millions up by 39%. The turnover also includes Rs.1060.000 Millions
from cotton trading activity which was not present in previous financial
year.
The Sale mix pie would clearly reflects forward strategy laid out by the
company where the fabrics business has gone below 50% of the total
turnover.
Denim at one point of time used to constitute more than two thirds of the
company's turnover has gradually declined and today accounts for only 32% of
the turnover with shirting forming 13% and knits fabrics business forming the
remaining 2%. Previous financial year denim had formed 41% of the
turnover.
RAW MATERIALS:
The increase in raw material consumption is mainly because of substantially
higher cotton prices in the last quarter of the financial year. The prices for
the cotton used in denim remained low for first nine months as the company had
bought cotton at bargain prices at the opening of the previous season hence the
increase in price is steeper. The cotton and yarn prices for other products
were slightly higher as compared to the previous year.
BUSINESS
REVIEW & DEVELOPMENTS:
DENIM:
The denim realization and volume which had improved in first few quarters
slipped back on account of downturn in both US and EU order positions in the
third quarter but has subsequently regained lost ground at least on account of
volume. The sales mix in spite of efforts from the company is skewed in favour
of exports as the domestic market continues to be in oversupply, suffered
severe setbacks. While the reinforced sales tem in the US and EU were supposed
to bring in volumes to offset the cost incurred on them, the altered market
condition and worsening currency scenario has pushed the plans further back.
The below par performance of retailers in the current holiday season and
continued trouble at one of the major customers has further depressed the order
book. The company as a long term strategy is reducing capacity of its denim
operations in the country and as informed in the past shut down the 20 Million
meters per annum Khatrej unit. The company intends to focus only on the premium
and mid premium product segments and for regular market is exploring
possibilities of moving manufacturing capacities to logical locations.
The company has almost completed the process of voluntary separation of workers
at its Khatraj unit and is currently exploring alternative uses for the
location.
BRANDED APPAREL RETAIL
The branded
apparel and retail business of the company continues to perform exceptionally
well. The sales for the year at Rs.4830.000 Millions have grown by 39% over
previous financial year. The current year saw 100% growth in sales volume of
Flying Machine brand which was re-launched with new look and Mr. Abhishek
Bacchan as Brand Ambassador.
Multiple brand portfolio at multiple price points strategy is yielding desired
results with rapid rise in the turnover. Focusing on value through Megamart
chain is expanding on the projected rate and currently stand at 83 small format
and 1 Large Format store. License agreement for Cherokee, US Polo Association,
IZOD, Pierre Cardin, Hart Shaffner Marx and Sansabelt were concluded during the
year. Your Company now has one of the strongest portfolio of brands in the
country and is in unique position to take leadership position across customer
segments. MegaMart opened its first Outlet Centre in Chennai on the 23rd
January, 2008 and plans to have 30 such Megamart Outlet Centers in top 20
cities over the next 4 years.
The company's focus on supply chain has resulted in clearance in the old season inventory and general compression in the
working capital cycle. The business had delivered positive PBDIT for three quarters
as well as for the whole year and the portfolio of mature brands continue to
return their best ever performances.
GARMENT OPERATIONS
Shirts product group volume has grown
by 27% compared to previous financial year. The Shirts business is also the
only business in the group which has been relatively insulated from the rapid
slide in Dollar as most of the sales are to EU customers and denominated in
Euro. The company is looking for leasehold facility to increase the volume and
is likely to add volumes in the first quarter of next financial year. Both the
operation parameters and earnings levels are at all time high at the shirts
business. Knits product group grew by 41% by volume and 32% by value compared
to previous financial year. The company strategy of focusing only on the value
added segment has yielded very positive results and reflected in the earnings.
The company is in a position to offer unique offerings to discerning customers
at value price due to its efforts in installing both facilities and process
like panel printing, overall printing, and certification for Organic and Fair
Trade products.
Jeans product group had its first full year of operation. The washing plant
operations are streamlined and the company has been able to establish possibly
the best denim laundry in the country. The projections provided by the key
customers for the on coming season look very encouraging.
SHIRTING
With new focused management and operations team in place the operational
parameters are at all time high and the product group has returned their best
ever earnings performance in last three years. The order book which had
suffered in the past due to lack of fresh placement from Indian exporters has
been bolstered by rapid growth in orders by Indian brands and retail companies.
Here again the focus on delivering unique products at value has positioned the
company for long term sustainable growth in this segment.
SUBSIDIARIES
ARVIND PRODUCTS LIMITED
The company returned profits for second year in row but lower by 59% compared
to previous financial year. The performance of the company has been affected by
two factors, reduction in volumes at Arvind Intex which is a captive spinning
unit for Denim business reflecting in the reduction capacity utilization. Khakis
division which was doing extremely well in the previous financial year and the
first half of the current financial year has suffered some downturn due to
sudden drop in volumes in the exports market.
ANUP ENGINEERING LIMITED:
A group company engaged in Engineering and fabrication business listed on
Ahmedabad Stock Exchange. The company was referred to BIFR in 2001 based on
March 2001 balance sheet. BIFR order passed in 19th July 2007 had converted the
Rs.20.000 Millions advanced by Arvind into Equity and with this conversion
Arvind will control 59% of the expanded equity making it a subsidiary of the
company. The company has done remarkable turnaround in last three years and
business has been growing at a rapid pace and already booked for most of next
financial year. The company had a turnover of about Rs.630.000 Millions and
profit after tax of Rs.80.000 Millions for 2007-08.
OUTLOOK
Denim
performance is expected to remain at the current levels and any incremental volume
and realization will be impacted by the exchange rate of Rs.40 to US$ at which
the company is hedged for 2008-09. The company expects no significant increase
in interest rates from the current level but expects reduction in debt level.
Fabrics as product group is expected to maintain the current level of
operations and improvement in earnings over the last quarter of 2007-08 is
likely to come way of better product mix and process efficiencies. Turnover
increase will primarily come from the Brand and Retail business and Jeans
factory utilization. Power situation will remain under stress for major part of
the year and the possibility of relief by way of fresh gas supply is at best
possible only in second half of the year. In spite of going through the lowest
phase in its existence denim is still the largest revenue earnings product and
Shirting which has long been performing below potential is showing sighs of
maturing and the drop in denim earnings have to an extent being cushioned by
shirting. The new generation business of Megamart and Brands are contributing
to turnover but not yet a significant contributor to earnings.
In light of the above outlook company had embarked on a strategy of moving away
from focus on fabrics and focus on lifestyle brands, retailing and value-added
fabric and garmenting solutions. The strategic action plan focuses on following
pillars:
- Profitable fabrics and
apparel business in India
- Fastest growing Brand
and Retail business
- Unlock value in non
strategic assets
- Use the cash flows to
de-leverage the balance sheet
The new brand identity and name change of the company was to reflect the
strategic focus. They believe the impact of new and focused strategy will be
seen in the coming financial year.
CONTINGENT
LIABILITIES
(a) Bills discounted Rs.869.000 Millions
(b) Claims against the Company not acknowledged as Debt
Rs.103.400 Millions
(c) Guarantees given by the Banks on behalf of the Company
Rs.33.800 Millions
(d) Guarantees given by the Company on behalf of the
subsidiary/ joint venture companies Rs.611.500 Millions
(e) Excise/Custom demands, Sales Tax demands, Income Tax
demands and Service Tax demand in dispute Rs.33.600 Millions, Rs.160.100
Millions Rs.04.100 Millions and Rs.05.300 Millions respectively.
(f) Dividend on Redeemable Cumulative Non Convertible
Preference Shares Rs.07.400 Millions
(g) Liability for Recompense Payment Rs.729.200 Millions.
The payment and the rate at which Recompense Payment is payable is contingent
on the repayment of the Total Outstanding to the Restructured Lenders in terms
of the Scheme of Restructuring approved by the High Court of Gujarat.
COMPANY’S SHARE IN:
(i) Contingent Liability in respect of guarantee given by Bank Rs.6.300 Millions
(ii) Excise Duty Demand in Dispute Rs.0.300 Millions
(iii) Capital commitments Rs.25.800 Millions
(iv) Counter Guarantee given to ultimate holding company Rs.520.000 Millions
(c) Financial Interest in Diesel India Fashions Arvind Private Limited has not been disclosed as the said Joint Venture has not commenced any business.
Factory Building is taken on lease period of 20 years with the no option of renewal, no sub lease of the building and having an escalation clause for increase in lease rental by 15% after every 3 years.
Plant and Machineries are taken on operating lease for a period of 3 to 60 months with the option of renewal.
The Particulars of these leases are as follows: (Rs. In
Millions)
|
Particulars |
31.03.2008 |
|
|
|
|
Future Minimum lease payments obligation on non-cancellable operating leases : |
247.700 |
|
Not later than one year |
47.300 |
|
Later than one year and not later than Five years |
178.100 |
|
Later than five years |
22.300 |
|
Lease Payment recognised in Profit and Loss Account |
83.700 |
Trade Reference:
v Atul Enterprises
v Albaj Engineering Corporation
v B. Trikamlal and Company
v Climax Marketing Private Limited
v Fourwent Engineering Company
v Geekay Corporation
v Chamunda Fabrication
v Chipko Bonding Systems
v Siddhi Polymers Private Limited
v Archem Industries
v Arjyot Chemicals Private Limited
v Synergy Chlorinations Private Limited
v Bhagat Engineering Works
v Bhavik Industries
v Shree Laxmi Engineering
v Gemini Polyplast Industries
v Sun Industries
v Khodiyar Industries
v R-Tex Enterprise
Fixed Assets:
- Freehold leasehold
- Buildings
- Machinery
- Machinery given on lease
- Motor vehicles office machinery dead
stock
As Per Web Details
Profile
The
Subjectwas set up with the pioneering effort of the Lalbhai brothers in 1931.
With the best of technology business acumen, Arvind has become a true Indian
multinational, having chosen to invest strategically, where demhas been high
quality required has been superlative. Today, The Subject is the flagship
company of Rs.20 billion (US$ 500 million) Lalbhai Group.
Subjecthas
set the pace for changing global customer demands for textiles has focused its
attention on select core products. Such a focus has enabled the company to play
a dominant role in the global textile arena. With its presence across the
textile value chain, the company endeavors to be a one-stop shop for leading
garment brands.
Forevision
Technology has brought Arvind to be one of the top three producers of Denim in
the world, on its way becoming the Global Textile Conglomerate. Arvind is
already making its presence felt in Shirting’s, Knits Khakhis fabrics apart
from being all set to create ripples in the ready to wear Garments world over.
BOARD OF
DIRECTORS:
CHAIRMAN
AND MANAGING DIRECTOR
Mr.
Sanjay S. Lalbhai
He is a Chairman and Managing Director of the Company. He is
a Science Graduate with a Master's degree in Business Management. He has been
associated with the Company for more than 28 years. He also holds directorships
in Arvind Spinning Limited, Mauritius, Amol Decalite Limited, Mahindra Gujarat
Tractor Limited, Torrent Pharmaceuticals Limited, Arvind Worldwide Inc., USA,
Arvind Worldwide (M) Inc. and Arvind Overseas (M) Limited.
DIRECTOR AND CHIEF FINANCIAL OFFICER
Mr.
Jayesh K. Shah
He is a Wholetime Director with designation of Director and
Chief Financial Officer of the Company. He is a Commerce Graduate and Chartered
Accountant and has been with the company for more than 22 years. He has a
distinguished academic career and extensive administrative, financial,
regulatory and managerial expertise. He also holds directorships in various
companies.
OTHER
DIRECTORS
Mr. S.
R. Rao (Nominee of EXIM Bank)
He is a Nominee Director of EXIM Bank. He is a graduate from
The Indian Institute Of Technology, Bombay. He is the Chief General Manager of
EXIM Bank of India. He is also on the Board of Global Procurement Consultants
Limited, Global Trade Finance Limited, and Nagarjuna Oil Corporation Limited
Mr.
K.M. Jayarao (Nominee of ICICI Bank)
He is a Nominee Director of ICICI Bank Limited, He is a B.E.
(Mechanical) and a Senior General Manager of ICICI Bank Limited. He is also on
the Board of Ispat Industries Limited, Nagarjuna Fertilizers and Chemicals
Limited, Share Microfin Limited, and Aban Loyd Chiles offshore Limited.
Mr.
Sudhir Mehta
He is a Non-executive and Independent Director of the
Company. He is a Science Graduate from Gujarat University He was instrumental
in the growth and progress of Torrent Pharmaceuticals Limited, the flagship
Company of the Torrent Group. He systematically expanded the power business of
Torrent Group by acquiring significant stakes in the Torrent Power AEC Limited,
and Torrent Power SEC Limited, and Torrent Power Generation Limited now merged
with Torrent Power Limited and one among the few successful independent power
projects in India. He has managed strategic alliance with leading international
giants from U.K., Germany, France and USA. He is an Executive Chairman of
Torrent Power Limited, Chairman of Torrent Pharmaceuticals Limited and Torrent
Private Limited and a Director of The Torrent Power Transmission Private
Limited,
Mr. Tarun Seth
He is a Non-executive and Independent Director of the Company.
He has a master's degree in Arts (Sociology) from M.S University and ITP
Harvard Business School, USA. He is a Management Consultant. He was a President
of Bombay Management Association and a member of professional bodies like
Indian Society for Applied Behavioral Science, Indian Society for Training and
Development and Bombay Management Association. He is on Board of various
Companies. He is a former faculty member of Motorola University and has trained
Motoral managers in the US, Europe, Australia, China, Taiwan, Singapore and
India. He is an independent and a non-executive Director of the Company.
Mr.
Munesh Khanna
He is a Non-executive and Independent Director of the
Company. He is a Chartered Accountant from Institute of Chartered Accountants of
India. He has 21 years of experience in Investment Banking from across the
Industrial spectrum in India in the areas of M&A, Financial Restructuring
and Resource Raising. In addition, he has also an extensive experience in the
Energy, Utilities and Telecom sectors.
Prior to joining Halcyon Resources & Management
Consulting Private Limited, he was the Managing Director and Head of Investment
Banking in DSP Merrill Lynch. Prior to this he was the Country Head and
Managing Director of Rothschild India and Partner- Country Head of Arthur
Andersen Corporate Finance. He has advised Indian Lenders on the Restructuring
of the Dabhol Power Project and LNG facility for a total value of US$ 1.9
billion. AXA on its joint venture with Bharati Group, Air Deccan on raising
funds US$ 40m through Private Equity and IPO and many other significant
transactions.
He is a member of the Young President Organisation (YPO). He
was also a Member of CII and a member of the Executive Committee of Federation
of Indian Chambers of Commerce and Industry ('FICCI') and Co - Chairman of the
Finance & Capital Market committee of FICCI.
Mr.
G.M.Yadwadkar (Nominee of IDBI)
He is a Nominee Director of IDBI. He is a General Manager of
IDBI, Ahmedabad. He is also on the board of Ecoboard Inds. Limited, Pune, SJK
Steel Plant Limited, Hyderabad, Gujarat Alkalies & Chemicals Limited, Vadodara and Gujarat Industrial and
Technical Consultancy Organization Limited,
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.46.34 |
|
UK Pound |
1 |
Rs.82.96 |
|
Euro |
1 |
Rs.65.82 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
9 |
|
PAID-UP CAPITAL |
1~10 |
9 |
|
OPERATING SCALE |
1~10 |
9 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
10 |
|
--PROFITABILIRY |
1~10 |
8 |
|
--LIQUIDITY |
1~10 |
9 |
|
--LEVERAGE |
1~10 |
9 |
|
--RESERVES |
1~10 |
9 |
|
--CREDIT LINES |
1~10 |
9 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
81 |
This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a
composite of weighted scores obtained from each of the major sections of this
report. The assessed factors and their relative weights (as indicated through
%) are as follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING
EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit transaction.
It has above average (strong) capability for payment of interest and
principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit consideration.
Capability to overcome financial difficulties seems comparatively below
average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
|