MIRA INFORM REPORT
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Report Date : |
25.09.2008 |
IDENTIFICATION
DETAILS
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Name : |
JINDAL POLY FILMS LIMITED |
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Formerly Known
As : |
JINDAL POLYESTER LIMITED |
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Registered
Office : |
19th K.M., Hapur-Bulandshahr Road, P.O. Gulaothi, District
Bulandshahr, Uttar Pradesh |
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Country : |
India |
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Financials (as
on) : |
31.03.2008 |
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Date of
Incorporation : |
09.09.1974 |
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Com. Reg. No.: |
20-3979 |
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CIN No.: [Company Identification
No.] |
L17111UP1974PLC003979 |
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TAN No.: [Tax Deduction &
Collection Account No.] |
MRTJ00149C |
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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 Polyester Resin, Polyester Filament Yarn,
Polyester Chips and Biaxially Oriented Polyester Film. |
RATING &
COMMENTS
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MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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 |
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Maximum Credit Limit : |
USD 46000000 |
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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 a well-established and reputed company of
Jindal Organisation. Available information indicates high financial responsibility
of the company. Their trade relations are fair. Financial position is
satisfactory. Payments are reported as slow but correct. The company can be considered normal for business dealings
at usual trade terms and conditions. |
LOCATIONS
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Registered
Office : |
19th K.M., Hapur-Bulandshahr Road, P.O. Gulaothi, District
Bulandshahr, Uttar Pradesh, India |
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Tel. No.: |
91-5732-2312088 |
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Fax No.: |
91-5732-2311087 |
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E-Mail : |
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Website : |
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Head Office : |
"Jindal", 56, Hanuman Road, New Delhi-110 001, India |
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Tel. No.: |
91-11-23748201 – 05 / 23349270 / 23748245 / 8349 / 23349270 / 74 |
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Fax No.: |
91-11-23345918 / 23748246 / 23748209 |
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E-Mail : |
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Website : |
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Sales and
Administrative Office : |
Plot No 12, Sector B-1, Local Shopping Complex, Vasant
Kunj, New Delhi-110070, India |
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Tel No.: |
91-11 26139256-65 |
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Fax No.: |
91-11 26125739 |
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E-Mail: |
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Others Located at: · Mumbai, Surat and Kolkata · Also at USA |
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Factory 1 : |
resin
and yarn:
19th K.M.,
Hapur-Bulandshahr Road, P.O. Gulaothi, District Bulandshahr, Uttar Pradesh,
India |
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Tel. No.: |
91-122-2312088 / 2311087 91-5732-229143 / 229105 |
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Fax No.: |
91-122-2312244 |
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Factory 2: |
film
and resin:
28th K.M. Stone, Nashik-Igatpuri Road, NH – 3, Vill. Mundhegaon, Tal.
Igatpuri District, Nasik,
Maharashtra, India |
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Tel. No.: |
91-2553-285402 / 285405 |
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Fax No.: |
91-2553-285403 |
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Factory 3 : |
india
polyfilms Limited (film):
160/1/7, Amboli Road, Village Kala , Khanvel, Silvassa ( UT of D and N
) |
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Tel. No.: |
91-2638-247264 / 358 |
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Other Contact : |
Export Sales – BOPP
Films Export Sales – PET
Films Domestic Sales – PET
films Domestic Sales –
BOPP films |
DIRECTORS
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Name : |
Mr. P. Gupta |
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Designation : |
Director ( Films) |
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Name : |
Mr. Sameer Banerjee |
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Designation : |
Director (Marketing) |
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Name : |
Mr. S. Singhal |
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Designation : |
Chief Operating Officer |
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Date of Birth : |
26.08.1976 |
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Qualification
: |
Fca |
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Date of
Appointment : |
29.07.2006 |
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List of outside Directorship
: |
1) Jindal Photo Limited 2) Rishi Trading Company Limited |
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Name : |
Mr. A. C. Wadhawan |
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Designation : |
Director |
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Name : |
Mr. Rashid Jilani |
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Designation : |
Director |
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Name : |
Mr. S. J. Khaitan |
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Designation : |
Director |
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Date of Birth : |
09-02-1959 |
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Qualification
: |
B.A. Eco (H), L.L.B. |
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Date of
Appointment : |
26.07.1996 |
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List of outside Directorship : |
1) Hindustan Vidyut Products
Limited 2) Jindal Stainless Limited 3) Kpl International
Limited 4) Lumax Ind. Limited 5) Oriental Carbon and Chemicals Limited 6) Rameswara Transport Limited 7) Suman Khaitan Advisory Services Private Limited 8) Gopi Nursery Private Limited |
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Name : |
Mr. Jogesh Bansal |
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Designation : |
Director |
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Date of Birth : |
03.04.1952 |
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Qualification
: |
B.Com |
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Date of Appointment
: |
08.09.2006 |
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List of outside Directorship : |
1) International Technotex Private Limited 2) Sarthak India Limited 3) Southwest Probuild Private Limited 4) Hindustan Zinc Limited |
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Name : |
Mr. S. Bansal |
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Designation : |
Director |
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Date of Birth : |
28.12.1970 |
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Qualification
: |
Mba |
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Date of
Appointment : |
29.07.2006 |
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List of outside Directorship : |
Swastik Pipes Limited |
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Name : |
Mr. R. Chander |
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Designation : |
Director |
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Name : |
Mr. R. Adusumalli |
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Designation : |
Director |
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Name : |
Mr. Sumant Singhal |
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Designation : |
Director |
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Date of Birth : |
26.08.1976 |
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Qualification
: |
FCA |
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Date of
Appointment : |
29.07.2006 |
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List of outside Directorship
: |
· Rishi Trading Company Limited · Jindal Packaging Films Limited · Ritu Marketing Private Limited |
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Name : |
Mr. R K Pandey |
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Designation : |
Director |
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Date of Birth : |
20.01.1940 |
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Qualification
: |
M.Com, LLB, FCS |
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Date of
Appointment : |
31.01.2007 |
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List of outside Directorship
: |
1. PTC Industries Limited 2. Precise Lab Private Limited 3. Green Valley Product Private Limited 4. British Health Care Product Limited 5. Spice Mobile Limited 6. Welcure drugs and Pharma Limited 7. Shree Rajasthan Syntex Limited 8. Hanug Toys and Industries Limited 9. Amar Ujala Publications Limited 10. AK Lab Limited 11. Ricoh India Limited |
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Committee
Membership of other Companies : |
· Welcure Drugs and Pharma Limited Chairman – Audit Committee Remuneration Committee Investor Services Committee · Spice Mobile Limited Chairman – Investor Services Committee Member – Audit Committee and Remuneration Committee · Amar Ujala Publications Limited Member –Audit Committee Chairman – Remuneration Committee · Ricoh India Limited Member – Audit Committee and Remuneration Committee · Hanug Toys and Industries Limited Chairman – Audit Committee |
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Name : |
Dr. Sudhir Kapur |
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Designation : |
Director |
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Date of Birth : |
08.07.1945 |
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Qualification
: |
B.Tech, M S P.hd |
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Date of
Appointment : |
30.01.2007 |
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List of outside Directorship
: |
· Country Strategy Business Consultancies Private Limited · Country Strategy Engineering Private Limited · Stromag India Private Limited |
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Name : |
Mr. Sanjay Mittal |
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Designation : |
Director |
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Date of Birth : |
17.10.1964 |
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Qualification
: |
Accounts and Taxation |
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Date of
Appointment : |
B. Com, CA (Inter) |
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List of outside Directorship
: |
· Consolidated Finvest And Holdings Limited · Jindal Photo Investments Limited · Jesmine Investments Private Limited |
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Committee
Membership of other Companies : |
· Consolidated Finvest and Holdings Limited : Member – Audit Committee and Share Transfer Committee · Jindal Photo Investments Limited : Member – Audit Committee |
KEY EXECUTIVES
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Name : |
Mr. S. Aggarwal |
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Designation : |
Chief Financial Officer |
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Name : |
Mr. S. Maheshwari |
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Designation : |
Company Secretary |
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Name : |
Mr. L P Soni |
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Designation : |
Vice President (Finance) and Secretary |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
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Names of Shareholders (As on 30.06.2008) |
No. of Shares |
Percentage of
Holding |
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Shareholding of Promoter and Promoter Group |
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Individuals/Hindu Undivided Family |
446600 |
1.59%
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Bodies Corporate |
15062726 |
53.61% |
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Institutions |
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Financial Institutions/ Banks |
645000 |
2.30% |
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Insurance Companies |
2657936 |
9.46% |
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Foreign Institutional Investors |
1939784 |
6.90% |
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Non-institutions |
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Bodies Corporate |
1393840 |
4.96% |
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I. Individual shareholders holding nominal share capital
up to Rs. 0.100 Millions |
2369610 |
8.43% |
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II. Individual shareholders holding nominal share capital
in excess of Rs. 0.100 Millions |
236507 |
0.84% |
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Any Other- |
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Non resident Indians |
568331 |
2.02% |
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Trusts |
977 |
0.00% |
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Clearing Members |
2269 |
0.01% |
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OCB’s |
2772300 |
9.87% |
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Total
|
28095880 |
100.00 |
BUSINESS DETAILS
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Line of Business : |
Manufacturing of Polyester Resin, Polyester Filament Yarn,
Polyester Chips and Biaxially Oriented Polyester Film. |
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Products : |
· Pet Films · BOPP Films · Metalized Films · Poly Chips
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PRODUCTION STATUS
(As on
31.03.2008):-
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Particulars |
Unit |
Licensed
Capacity |
Installed
Capacity |
Actual
Production |
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Polyester
Filament Yarn |
MT |
54000 |
54000 |
---- |
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Polymer Chips |
MT |
131000 |
121175 |
79640.85 |
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Biaxially Oriented Polyester/ Polyproplyene Film |
MT |
176000 |
176000 |
158.706 |
GENERAL
INFORMATION
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No. of Employees : |
1000 |
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Bankers : |
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Facilities : |
NOTES:-
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name : |
Kanodia Sanyal and Associates Chartered Accountants |
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Associates : |
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Subsidiaries : |
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CAPITAL STRUCTURE
(As on
31.03.2008):-
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
30000000 |
Equity Shares |
Rs.10/- each |
Rs. 300.000 Millions |
|
175000000 |
Preference Shares |
Rs.10/- each |
Rs. 1750.000 Millions |
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Total
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Rs.
2050.000 Millions |
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Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
28095880 |
Equity Shares |
Rs.10/- each |
Rs. 280.959 Millions |
Notes on Share Capital:-
- 30000 Equity Shares were allotted as fully paid up pursuant to a contract
without payment being received in cash.
- 10378400 Equity Shares were issued as Bonus Shares by Capitalization
of Reserves.
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 |
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1] Share Capital |
280.959 |
280.959 |
280.959 |
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2] Share Application Money |
0.000 |
0.000 |
0.000 |
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3] Reserves & Surplus |
8847.669 |
7587.662 |
7005.562 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
9128.628 |
7868.621 |
7286.521 |
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LOAN FUNDS |
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1] Secured Loans |
1705.911 |
2371.102 |
2737.436 |
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2] Unsecured Loans |
2.121 |
2.176 |
7.936 |
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TOTAL BORROWING |
1708.032 |
2373.278 |
2745.372 |
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DEFERRED TAX LIABILITIES |
1298.491 |
1232.620 |
1106.915 |
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TOTAL |
12135.151 |
11474.519 |
11138.808 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
8330.320 |
8557.687 |
8023.876 |
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Capital work-in-progress |
949.649 |
452.982 |
499.458 |
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INVESTMENT |
1010.374 |
932.543 |
1656.881 |
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DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
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CURRENT ASSETS, LOANS & ADVANCES |
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Inventories |
1064.468
|
1062.198 |
1154.331
|
|
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Sundry Debtors |
925.433
|
872.521 |
538.883
|
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Cash & Bank Balances |
76.374
|
77.343 |
101.290
|
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Other Current Assets |
0.000
|
0.000 |
0.000
|
|
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Loans & Advances |
877.383
|
522.859 |
551.125
|
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Total
Current Assets |
2943.658
|
2534.921 |
2345.629 |
|
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Less : CURRENT
LIABILITIES & PROVISIONS |
|
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Current Liabilities |
982.148
|
886.121 |
1270.525
|
|
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Provisions |
116.751
|
117.589 |
116.657
|
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Total
Current Liabilities |
1098.899
|
1003.710 |
1387.182 |
|
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Net Current Assets |
1844.759
|
1531.211 |
958.447
|
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MISCELLANEOUS EXPENSES |
0.049 |
0.096 |
0.146 |
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TOTAL |
12135.151 |
11474.519 |
11138.808 |
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PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
|
Sales Turnover |
12592.854 |
10198.086 |
8589.276 |
|
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Other Income |
196.436 |
123.725 |
0.000 |
|
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Total Income |
12789.290 |
10321.811 |
8589.276 |
|
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Profit/(Loss) Before Tax |
1939.119 |
903.113 |
530.256 |
|
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Provision for Taxation |
613.371 |
253.405 |
63.229 |
|
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Profit/(Loss) After Tax |
1325.748 |
649.708 |
467.027 |
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Export Value |
3524.569 |
3522.207 |
2495.786 |
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Import Value |
1811.719 |
3274.964 |
2134.355 |
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Expenditures : |
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Manufacturing Expenses |
1476.359 |
1253.776 |
|
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Raw Material Consumed |
8032.206 |
6712.712 |
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Personnel Expenses |
137.059 |
122.975 |
|
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Excise on Increase/(Decrease) in stock |
[7.662] |
[5.868] |
|
|
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Accretion (Decretion) in Stock |
26.947 |
88.809 |
8059.020 |
|
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Selling and Distribution Expenses |
316.061 |
360.301 |
|
|
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Interest |
140.767 |
175.465 |
|
|
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Depreciation & Amortization |
625.648 |
605.552 |
|
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Total Expenditure |
10850.171 |
9418.698 |
8059.020 |
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QUARTERLY RESULTS
|
Year |
30.06.2008 |
|
Type
|
1st
Quarter |
|
Sales Turnover |
3918.900 |
|
Other Income |
44.600 |
|
Total Income |
3963.500 |
|
Total Expenditure |
3064.900 |
|
Operating Profit |
898.600 |
|
Interest |
38.100 |
|
Gross Profit |
860.500 |
|
Depreciation |
159.000 |
|
Tax |
134.200 |
|
Reported PAT |
508.200 |
KEY RATIOS
|
Year |
31.03.2008 |
31.03.2007 |
31.03.2006 |
|
Debt-Equity Ratio |
0.24 |
0.34 |
0.49 |
|
Long Term Debt-Equity Ratio |
0.17 |
0.26 |
0.35 |
|
Current Ratio |
0.95 |
0.83 |
0.69 |
|
TURNOVER RATIOS |
|||
|
Fixed Assets |
1.12 |
0.95 |
0.86 |
|
Inventory |
13.25 |
10.19 |
8.16 |
|
Debtors |
15.68 |
16.00 |
14.81 |
|
Interest Cover Ratio |
14.77 |
5.62 |
3.59 |
|
Operating Profit Margin(%) |
19.20 |
14.10 |
12.52 |
|
Profit Before Interest And Tax Margin(%) |
14.76 |
8.74 |
6.10 |
|
Cash Profit Margin(%) |
13.85 |
10.53 |
10.30 |
|
Adjusted Net Profit Margin(%) |
9.41 |
5.17 |
3.88 |
|
Return On Capital Employed(%) |
19.73 |
9.73 |
6.33 |
|
Return On Net Worth(%) |
15.60 |
7.70 |
6.17 |
LOCAL AGENCY
FURTHER INFORMATION
HISTORY
Subject incorporated as a public limited company in Sep.'74 in
the name of Hindustan Pipe Udyog, got its present name in Jan.'95. In 1974, the
company set up its first unit to manufacture ERW steel pipes and tubes, black
and galvanised, at Jindal Nagar (Ghaziabad district), UP. In Apr.'93, the steel
unit of the company was transferred to Jindal Pipes.
The company is the largest producer of flexible packaging films in the country.
The company also manufactures and sell POY and manufacture polyester chips for
captive consumption. Jindal France SAS, Rexor SAS and Hindustan Polyester
Limited are the subsidiaries of the company.
In 1985, subject diversified into the
manufacture of polypropylene filament yarn and polyester filament yarn at
Gulaothi, UP. It also modernised its POY plant in 1990 to update technology and
replace certain old and worn-out equipments/components. In 1992, it set up a
polycondensation plant with an installed capacity of 15000 tpa for captive
consumption.
During 1994-95, Northern Plastics Finance Company (NPFCL), engaged mainly in
investing and dealing in securities and finance, was amalgamated with the
company. Subject has also came out with
a public issue in Aug.'94 to part-finance the expansion scheme and to diversify
to manufacture bottle-grade chips.
During 1995-96, the company has set up a new project of bi-axially oriented
polyester film at Nasik as a 100% EOU with an installed capacity of 12000 tpa.
In Apr.'99, India Polyfilms and Patel Poly Products were merged with the
company and all the assets and liabilities of the merged companies were
transferred and vested in the company on 14th Mar. 2000.
Subject has expanded the capacity of
Polyester film plant 12000 tonnes to 36000 tonnes by commissioning a new thick
polyester film line in the month of December 2000. The commercial production of
BOPP with a annual capacity of 13000 TPA was commissioned in 2002-03. To meet
the future demand the company is planning to take some new projects like
Manufacture of BOPP film with total capacity of 45000 TPA, Metalizing of Bopet
Film with a capacity of 12000 TPA and to augment the Poly condensation with a
total capacity of 50000 tpa etc.
During 2004-05 the company has increased the installed capacity of Biaxially
Oriented Polyester/Polypropylene Film by 57000 MT and with this expansion the total
installed capacity of Biaxially Oriented Polyester/Polypropylene Film has
increased to 131000 MT.
During 2005 the company made a public offer by way of 100% Book Building by
issuance of 83,33,325 Equity Shares of face value of Rs.10 each at a premium of
Rs.350 per shares amounting to Rs.3000 Million.
During 2004-05 the company has commissioned an 8.2 metre wide, five-layer line
with the capacity to produce 32000 TPA of BOPP films at Nashik Maharashtra.
Further it also proposes to set up a 45000 TPA, 8.2 metre wide line to make
BOPP films at Nashik, Maharashtra by August 2006. The company has also
established an 8.7 metre wide thin film line at Nashik, Maharashtra. With the
implementation of this line the company now has a total capacity of 86000 tonnes
for Bopet film.
In August 2005 the company increased its metallising capacity by 14000 TPA to
26000 TPA at its plant in Nashik, Maharashtra. The company also proposes to
install two line of 7000 TPA by September 2006. The company has already commissioned
4500 TPA capacity to manufacture PVDC, Acrylic and LTS Coated films, at Nashik.
A second line with same capacity is likely to start by February 2006.
During March 2005 the name of the company was changed from Jindal Polyester
Limited to Jindal Poly Films Limited
BUSINESS
The company is also producing specialty polyester partially
oriented yarn like cationic bright triloble, bright triloble, bright cationic
dyeable and dope dyed (coloured) polyester partially oriented yarn. At present
the company is producing polyester partially oriented yarn from circular and
warp knitting in various shades and deniers.
The company is also specialised in the production of
specialty resin like bright, white opaque, milky white, cationic and other
additive loaded chips.
INDUSTRY
Good domestic demand, improved operating margins of the POY
manufacturers in last 2-3 years alongwith easy availability of cheap second
hand POY manufacturing equipments have attracted many down stream texturisers
to backward integrate into manufacturing POY. None of the large manufacturers
are likely to undertake any green field expansions. Existing domestic POY
manufacturers are going in for capacity additions, modernisation and
de-bottlenecking. The total addition in capacity is likely to be to the tune of
0.6 million tonnes in next 2 years.
The
domestic demand for PET films was good and all PET film producers produced at
higher than the rated capacities. Exports from India maintained a growth of
over 12% compared to the previous year and the current year should see growth
of over 20% with almost every PET film consuming country choosing to buy from
India.
Overview
Subject
is a leading producer of flexible packaging films. The Company operates the world's
largest single location facility for flexible packaging films at Nashik,
Maharashtra and employs modern technology to produce high quality products at
lower cost.
MANAGEMENT DISCUSSION
and ANALYSIS
Overview:
Subject is a leading producer of flexible packaging films. The Company
operates the world's largest single location facility for flexible packaging
films at Nashik, Maharashtra and employs modern technology to produce high
quality products.
Industry, Structure and
Developments
Flexible Packaging
Film:
Flexible packaging typically includes materials such as plastic films, paper and aluminium foil. Over the years, BOPET Film and BOPP Film (forms of plastic-based flexible packaging film) have become the preferred choice for packaging consumer articles including food and clothing. Besides such films, Jindal Poly Films also offers a range of metallised and coated film products to its customers.
Subject is the leading producer of flexible packaging films in the country. The
Company also maintains a strong presence as a key exporter to several
countries. Flexible packaging film follows a business-to-business model,
supplying base film to key converters/processors - who in turn sell the value
added product to customers.
BOPET Film
BOPET Film is a versatile product broadly classified according to thickness of the film. Thick Films (50-350 microns in thickness) find application in photographic/X-ray, electronics, printing, textile, pre-press and office supplies, motor insulations and document lamination. Thin Films (10-36 microns in thickness) are used in metallic yarn, cables, transformers, capacitors, audio/video tape, hot stamping foils, release films, labels, decorative ribbons and labels.
Jindal Poly Films has a capacity to manufacture 86,000 TPA of BOPET Film.
BOPP Film
Better moisture retention properties render BOPP Film more suitable for food products like snack foods, biscuits, pasta, dried foods and meat.
Further, BOPP Film also finds application in wrapping cigarette cartons, ready-made garment bags, adhesive tapes and print lamination.
The market for BOPP Film in India, unlike the rest of the world is
underdeveloped. There exists a popular low quality, cheap alternative in the
form of TQPP (Tubular Quenched Polypropylene Film). Growing preference for
premium and sophisticated packaging however is driving growth in Asian
economies such as India and China with increased availability of BOPP, TQPP is
being fast replaced by BOPP.
The Company has presently three lines in operation for BOPP Film at Nashik,
Maharashtra:
* 13,000 TPA, 6.6-meter wide, three layer line
* 32,000 TPA, 8.2 meter wide, five-layer line
* 45,000 TPA, 8.2 meter wide, three-layer line
Metallised Films
Vacuum deposition of Aluminium on Pet and BOPP films increase the barrier properties of such films. Besides flexible packaging metallised Pet films is used for metallised yarn. Metallised BOPP is widely used for gift wrapping. The Company has a total metallising capacity of 40000 tpa. Two new Metallizers with a combined capacity of 14,000 tpa have been commissioned during the year.
Coated Films
PVDC coated BOPP and Pet films are used in the flexible packaging industry.
Subject is the only company in India to offer this product. The Company has a capacity of 4500 tpa to manufacture PVDC, Acrylic and LTS coated films.
Polyester Chips
Subject has the in-house ability to manufacture polyester (PET) chips as per the product requirement, for its BOPET Film business. The Company has installed capacity of 93,800 TPA at Nashik, Maharashtra to produce PET chips.Polyester Yarn
The Company has a Partially Oriented Yarn (POY) facility at Gulaothi, Uttar
Pradesh. This business has witnessed continued weakness in margins and the
operations has been suspended.
Opportunities and Threat
BOPET Film
A perceptible volume shift in the consumption of BOPET film has been noticed in the high consumption areas of USA, Europe and Japan. Converting operation from these high cost areas are shifting to Asia in general and China and India in particular. Whereas production capacities in the matured markets of USA, Europe and Japan are declining, large growths are being witnessed in Asia where capacity increase is continuing.
In the short term, growth of the business will be export driven with Asian
producers encashing on the declining capacities in the developed world.
However, the long term scenario would indicate that the domestic growths in Asia would dominate polyester film usage with major shift in converting operation to Asia.
BOPP Films
The global BOPP industry is dominated by China which accounts for nearly 40% of the global capacity and consumption. The capacity utilization in China has been around 70% forthe last few years. The Chinese market itself is growing at an average rate of around 8% p.a.
It is also observed that Chinese cost is increasing compared to previous years
largely due to reduction in subsidies. This has allowed prices of Subject 's
products to increase both in the domestic and international market.
The domestic market is enjoying good growth mainly driven by the fast
replacement of TQPP by BOPP and aided by the growth of the flexible
packaging.
Segment Performance
Flexible Packaging
Film
The flexible packaging business continues to expand with FY2008 segmental revenues of Rs. 14093.500 millions (Rs. 11212.600 millions last year). In value terms, the domestic sales grew by 25.7% .Demand visibility particularly in BOPET Films remains intact with prices demonstrating signs of increase.
Trends in the BOPP Film and High value added Film market also remain healthy.
OUTLOOK
Flexible Packaging Film
India continues to lag
the world in usage of flexible packaging film with one of the lowest per capita
consumption rates globally. Nevertheless, the momentum from applications in
packaging continues to be strong driving growth in both BOPET Film and BOPP
Film markets. The growth is also driven by an increase in the export of
flexible packaging laminates from India as converting operations are shifting
from Europe and USA to India.
BOPET Films
As much as 80% of the sales of BOPET Film can be attributed to applications in packaging. Rapid economic growth being witnessed in India and China is creating larger opportunities for the use of flexible packaging film in consumer products, hot stamping foils, metallic yarns, telecom and other electrical applications. The Asian region is expected to account for 60% of worldwide BOPET Film sales over the next two years expanding at a rate of 12%. Meanwhile, estimated growth for thin films in the global markets is at 7%.
BOPP Films
The BOPP Film market in India is increasing mainly on account of greater prevalence of modern format retailing and higher preference for hygienically packed, convenient forms of food articles amongst customers.
Moreover, the replacement of TQPP Film is expected to intensify with lowering of cost differentials with BOPP Film, better availability of superior quality BOPP Film and creation of novel application areas for BOPP Film. Growth in Indian demand for BOPP Film over the next few years is being projected at 20% compared to 7.5% globally.
Risks and
Concerns
Input costs
The largest component of
costs involved in making flexible packaging film is attributable to raw
materials. The PET chips used to make BOPET Film as well as the polymers that
go into producing BOPP Film are derived from petroleum.
Given the continued hardening trend in crude oil and demand for polymers for
competing applications the pressure on input costs can be expected to continue.
Flexible packaging film makers have thus far been able to pass down these costs
to end consumers and are expected to do so in the foreseeable future.
Financial
Performance
Subject reported a 25%
increase in gross revenues from Rs.11293.100 millions to Rs. 14093.500 millions
driven exclusively by its flexible packaging films business. Other income
during the period was at Rs. 196.400 millions.
Sales in the domestic market improved 36.5% to Rs. 10451.800 millions. The
Company continues to develop the BOPP Film market. Exports during FY2008 were
at Rs. 3641.800 millions as against exports of Rs. 3639.400 millions in last
year.
Despite increase in the rate of interest in general, interest cost were lower
at Rs. 140.800 millions (Rs. 175.500 millions in FY 2007) due to better working
capital management. The Profit Before Tax stood at Rs. 1939.100 millions.
Subject had Net Profits of Rs. 1325.800 millions in FY2008 giving an EPS of Rs.
47.19.
Performance
Highlights:
- There is improvement in Operating Profit margins during the year to 21.48% from 16.51 % in the last year.
- Gross Sales increased to Rs. 14093.500 millions in the financial year 2007-08, up 24.8% from Rs. 11293.100 millions the year before.
- Exports for the year 2007-2008 stood at Rs. 3641.800 millions as compared to Rs. 3639.400 millions in the last year.
- The operating profit of the company was Rs. 2705.500 millions as against Rs.1684.100 millions last year - growth of 60.65%.
NEW PROJECTS:
The Company's 2 new wide width Metallizers with a combined capacity of 14,000 tpa have commenced commercial production from March, 2008. The total capacity of Metallizers is now 40,000 tpa. The implementation of 2 new BOPP Lines (Line 4 and 5) with capacity of 45000 tpa each is proceeding as per schedule and shall be operational during the current financial year i.e.
2008-09.
With the growing demand of BOPP, the Company has decided to further expand the
capacity of the BOPP by installing 1 (one) more new BOPP Line (Line 6) with a
total capacity of 40,000 tpa. The Company has also decided to install one more
Polyester Film line (BOPET) with a capacity of 25,000 tpa alongwith Mettalisers
and Coating Film Line. These expansion projects will have the capital outlay of
Rs. 5000 millions approx. which shall be financed by way of ECB, Term Loans and
internal accruals. After all the expansion plans are implemented, the Company
will have BOPP capacity of 2,20,000 tpa and Polyester Film (BOPET) capacity of
1,11,000 tpa. The expanded capacity will be operational in a phased manner in
next 2-3 years.
OTHER
DETAILS:-
- The Export
obligation undertaken by the
company import of capital equipments under EPCG/100% EOU scheme of the
central Government at the
Concessional or zero rate of custom
duty are in the opinion of the management expected to the fulfilled within their respective due dates / extended due dates.
- During the
year one 100% EOU unit of the company at Nasik was debonded and allowed to
operate as DTA unit under the EPCG scheme on fulfillment of the prescribed
conditions. The consequent financial implications have been duly accounted
for.
Segment
Reporting Policies:-
Primary
Segment:-
Business segment: The
Company’s operating business are organised and managed separately according to
the nature of products, with each segment representing a strategic business
unit that offers different products.
FIXED ASSETS
- Land
(Freehold)
- Factory
Buildings
- Other Buildings
- Plant and
Machinery
- Furniture and
Fixture
- Office
Equipments
- Computers
- Vehicles
WEBISTE DETAILS:-
History
1985 Commenced manufacturing of POY at Gulahoti,
Bulandshahar, U.P.
1992 Backward integration into manufacturing of
Polyester Chips for captive consumption
1996 Diversified into manufacturing BOPET films
at Nasik.
2000 Installed a new thick BOPET film
manufacturing facility
2003 Diversified into manufacturing BOPP and metallised films at
Nasik Acquired Rexor, France in November 2003 for Euro 8.5 million
2005 Started 2nd 8.7 mtrs width BOPET FILMS line
with a capacity of 25000 tpa.
Started 5 Layer 8.2 mtrs width BOPP
FILMS line with a capacity of 32000 tpa.
2006 Started 2nd 8.2 mtrs width BOPP FILMS with
a capacity of 45000 tpa.
2007 Started 3rd 8.2 mtrs width BOPP line with a
capacity of 45000 tpa.
Company Overview
Subject is a part of INR 30
billion B.C.Jindal group, a 50 year old industrial group offering a wide range
of products. The group has promoted a number of companies over the years and is
involved in diverse activities including manufacturing of Polyester Film,
Polypropylene film, Steel pipes and Photographic products. Subject is the
largest manufacturer of BOPET and BOPP films in India. They produce:
- BOPET film
- BOPP film
- Metallised BOPET film and BOPP film
- Coated BOPET and BOPP films.
Polyester chips (for
captive consumption in the BOPET film)
From being only a polyester yarn producer in 1985, Subject diversified in 1996 into BOPET film production. In 2003, Subject commenced production of BOPP film and metallised film. Subject plan to commence production of coated film products by July 2005. Subject capabilities were strengthened by acquisition in November 2003 of Rexor S.A.S, in France, which produces metallised and coated films as well as tear tape, stamping foil, security thread and other high-value products.
Subject plant at Nasik, Maharashtra is the world’s largest single location
plant for the manufacture of BOPET and BOPP films.
Current
Capacity
-
86,000 tpa of BOPET films.
-
90,000 tpa of BOPP films.
-
46,000 tpa of metallised films.
-
100000 tpa of polyester chips.
-
9000 tpa of coating capacity.
Expansion
Plans
a. Two
8.7 mtrs wide 90000 tpa capacity BOPP FILMS in July and Sep 2008.
b. One
8.7 mtrs wide 25000 tpa capacity BOPET FILM by June 2009.
c. Two
8.7 mtrs wide with a capacity of 60000 tpa BOPP FILMS by 2009-10.
d. Two
expansion coating lines with a capacity of 9000 MT in mid 2009.
e. Two
more metalizer with a capacity of 20000 tpa in 2010. .
They are the World's 5th largest BOPET Film manufacturers in the World. They will be in the TOP 5 Producers of BOPP Films in the world after Expansion.
Rexor makes and sells a broad range of metallised and coated BOPET films for preserving food products and is a market leading producer of “tear tape” for easy opening of cheese portions and laminated films used in the packaging of luxury products, such as cosmetics and perfumes. Rexor is the leading independent producer of security threads for bank notes. Rexor also produces film for decoration, insulation, aeronautics and sun protection. Rexor holds proprietary technologies for laser demetallisation of security threads and other bank note security applications and for slitting films into widths as short as 0.20 milli meters.
Promoter Group
· Project execution
· Investment in the latest technology
· Market opportunity identification
· Prudent financial management
· Working capital management e.g. cash and carry
· Overhead costs minimizations
Rexor
Subject concluded the acquisition
of REXOR SA France through a subsidiary company Jindal France SAS. Founded in
1954, REXOR SA has emerged as a major European player in flexible and luxury
packaging films for special applications. The European leader in tear strips
and film wrap reports an annual capacity of 4000 tons, along with a revenue
about Euro 30ml.
ISO 9002 certified since 1996,
REXOR SA, decided to improve the quality of its products and services even
more. In respect to that, today, REXOR SA possesses high-performance
environmentally friendly manufacturing equipment and has mastery over complex
polyester/BOPP film coating technologies besides expertise in metallisation,
demetallisation and cutting of such films. Besides, it considers the customer
relationship as an integral part of the quality chain and works closely with
its customers to ensure the optimization and further development of their
expertise.
The highly qualified engineers at REXOR SA provide technical assistance on
every innovative project, through their participation in the research and
development of customized products.
Features of REXOR SA today are:
· Their present turnover is Euro 30 million.
· Enjoys good brand name and technological strength for Coated Films.
· Only independent producer of security threads for bank notes to combat counterfeiting
· Only French producer of hot stamping foils and European leader in lamination films.
· Largest producer of Tear Tape and Film Warp in Europe
Management
Subject has a professional management
team with substantial experience in the industry that has helped the company
ride several business cycles successfully.
The company promotes strong
customer bonds and long-term relationship with a focus on partnership approach.
The Group is all set to take on the most difficult global challenges, with a
keen eye on the latest innovations in both the Polyester Film and Photo Film
industry.
As a matter of fact, the existence
of a core strategy team has led to identifying new initiatives for maintaining
strong competitive positioning and cost leadership. Primary functions
centralised at the Head Office include marketing, exports, imports, purchasing
and HR. Other functions are delegated to the highly motivated corporate team.
The team consists of people who are experts in their own areas.
Subject has always worked with an
objective to provide a sustainable social environment to move human society
towards a sustainable future. In addition, its deep understanding and
commitment to responsibilities, has enabled Subject to ensure constant improvement upon its delivery systems,
innovate action and endeavors to exceed the expectations of its customers,
employees, shareholders and all partners.
Quality Policy
They at the company shall endeavor
to develop, manufacture and supply Products and Services of unmatched quality
on time through Speed, Innovation, Teamwork, Flexibility and Empowered
employees so as not only to meet but exceed customer expectations globally.
They are an ISO 9001:2000 certified company.
The Quality Objectives are:
· Enhance customer satisfaction by providing consistency in quality.
· Improve Business performance through effective quality management systems.
· Improve product and resource utilization.
· Developing a competent team through training
Pet Films
Polyester film commonly known as
PET film is a versatile film, which has a vast range of applications. The film
provides a strong barrier to moisture, odour and gases making it suitable for
use in flexible packaging. It’s high tensile strength, thermal and chemical
stability makes it suitable for a multitude of applications in electric
insulation, office supplies, graphic arts, magnetic media imaging, metallic
yarn and industrial applications.
BOPP Films
Polypropylene film commonly known
as BOPP is widely used for food packaging, textile bags, overwraps for
cigarette and personal products, adhesive tapes and labels. BOPP film possesses
dimensional stability, high tensile strength, good stiffness, high clarity,
excellent printability and most importantly, heat sealability.
Metalized Films
Subject has four wide width
metallizers with Plasma treatment facilities for enhanced shelf life and
barrier properties. Two more metallizers of 2850 mm width are being installed
by Jan and March 2008.
Poly Chips
JINDAL GROUP stands for the
highest Polyester Films, Polyester chips and resins production facilities, with
plants located at Nasik to cater to captive consumption.
press releases
ISSUE OPEN FROM 9TH
JUNE 2005
Jindal Poly Films Limited (the
“Company”), a part of the Rs. 15000 million B.C. Jindal Group, manufactures
flexible packaging films namely BOPET films (polyester films), BOPP films
(polypropylene films) and metallised films. It also manufactures and sells POY
and makes polyester chips for captive consumption. The films are used in
labels, adhesive tapes, food packaging, consumer products and textile products.
Jindal Poly Films is launching its follow-on public issue
aggregating upto Rs.3000 million through the book building route to fund its
expansion plans, details of which are set out in the red herring prospectus
dated May 25, 2005 filed by the Company with the RoC (the “Red Herring
Prospectus”). The issue opens on June 9, 2005 and closes on June 15, 2005. The
price band for the Issue shall be decided by the Company, in consultation with
the BRLMs atleast one day prior to the issue opening date and shall be
advertised in Business Standard (all editions), Jansatta and Amar Ujala (Kanpur
Edition). Bid cum Application Forms shall be available from the Company, BRLMs,
the Syndicate Members and the Sub-Syndicate Members.
Jindal Poly Films acquired Rexor S.A.S, a French company, in
November 2003 to gain access to a broad range of advanced metallised and coated
film production technologies, which can be used in Jindal Poly Films’
cost-efficient production facilities in India.Additionally, the acquisition has
strengthened the Company’s European distribution network.
DEG – Deutsche Investitions-und Entwichlungesgesellschaft,
one of Europe’s largest development finance institutions, has recently invested
in the Company and currently holds approximately 9.5% of the equity share
capital.
In fiscal 2004, the Company had unconsolidated net sales of
Rs. 5422 million and unconsolidated net profit before taxes of Rs. 801 million.
The Company’s focus is on being an integrated packaging
films solution company. It is competitively positioned and offers a full range
of thin and thick BOPET film and BOPP film products required by large flexible
packaging converters (who buy and process the Company’s products for
distribution to end-users).
From being a producer of only polyester yarn in 1985, the
company diversified into BOPET film production in 1996. In 2003, the company
commenced production of BOPP films and metallised films and now plans to
commence production of coated films, at its plant at Nasik by July 2005. The
capabilities to produce value added products have been strengthened by the
acquisition of Rexor which produces metallised and coated films for
applications such as tear tapes, hot stamping foils, security threads and other
high-value products for specialized technical applications.
The
Company’s plant at Nasik, Maharashtra is the largest single location plant in
India for the manufacture of flexible packaging films and, it believes, amongst
the largest in the world. Following the installation of the new BOPET film line
in March 2005, the Company is stated to have the fifth largest BOPET film manufacturing
capacity in the world.
Jindal
Poly uses the latest state-of-the-art wide-width BOPET film and BOPP film
manufacturing lines. Its 8.2 mtr wide 5-layer BOPP film line, installed in
February 2005, is capable of producing speciality films which command higher
margins.
Jindal
Poly Films is one of India’s largest exporters of BOPET films with exports of
more than Rs. 1,800 million during the nine month period ended December 31,
2004. The Company accounted for a majority of the total BOPET film exports from
India to the EU during such period. The Company is currently not subject to
anti-dumping duties on BOPET film exports to the EU.
Jindal
Poly Films is currently undertaking further expansion of its BOPET and BOPP
film production capacities and are installing additional coating and
metallising lines for producing high value added products. It expects the first
phase of the expansion plans to be completed by December 2005, with additional
expansion planned in 2006.
|
Locations |
BOPET Film |
BOPP Film |
Metalliser Plant |
Polyester Chips |
POY Coating
Plant |
|
|
Gulaothi, UP |
--- |
--- |
--- |
27375 |
54000 |
--- |
|
Nasik,
Maharashtra |
36000 |
13000 |
5000 |
43800 |
--- |
--- |
|
Expansions at
Nashik in 2004-March 2005 |
50000 |
32000 |
7000 |
50000 |
--- |
--- |
|
Total Existing
Capacity |
86000 |
45000 |
12000 |
121175 |
54000 |
---- |
|
Expansions to be
competed In April –
December 2005 |
--- |
--- |
14000 |
--- |
--- |
9000 |
|
Total Expected
Capacity in December 2005 |
86000 |
45000 |
26000 |
121175 |
54000 |
9000 |
|
Proposed
expansions to be completed by September 2006 |
25000 |
45000 |
14000 |
50000 |
--- |
9000 |
|
Total Expected
Capacity in September 2006 |
111000 |
90000 |
40000 |
171175 |
54000 |
18000 |
Please
note that the above information about the Company is necessarily incomplete in
nature and for relevant details and for risk factors relating to the operations
of the Company please see the Red Herring Prospectus dated May 25, 2005, filed
by the Company with the RoC.
This
press release is not an offer to sell securities of Jindal Poly Films Limited
to potential investors in India or in any other jurisdiction, including the
United States. Potential investors are advised to read the detailed terms and conditions
of the Red Herring Prospectus.
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.45.83 |
|
UK Pound |
1 |
Rs.84.90 |
|
Euro |
1 |
Rs.67.26 |
SCORE & RATING
EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
--- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
YES |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
68 |
This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a
composite of weighted scores obtained from each of the major sections of this
report. The assessed factors and their relative weights (as indicated through
%) are as follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING
EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit transaction.
It has above average (strong) capability for payment of interest and
principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit consideration.
Capability to overcome financial difficulties seems comparatively below
average/normal. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
|