1. Summary Information
|
|
|
Country |
|
|
Company Name |
CARBORUNDUM
UNIVERSAL LIMITED |
Principal Name 1 |
Mr. M.M. Murugappan |
|
Status |
Good |
Principal Name 2 |
Mr. K. Srinivasan |
|
|
|
Registration # |
18-318 |
|
Street Address |
Parry House, |
||
|
Established Date |
21.04.1954 |
SIC Code |
-- |
|
Telephone# |
91-44-25211652 / 25306789 / 42216789 |
Business Style 1 |
Manufacturing and Selling of Abrasives Grinders Like Grinding Wheels
and Coated Abrasives etc. |
|
Fax # |
91-44-25230706 / 42216149 |
Business Style 2 |
-- |
|
Homepage |
Product Name 1 |
-- |
|
|
# of employees |
1584 |
Product Name 2 |
-- |
|
Paid up capital |
Rs.
186,714,000 |
Product Name 3 |
-- |
|
Shareholders |
Bodies Corporate (36.04%) |
Banking |
State Bank of Standard Chartered Bank |
|
Public Limited Corp. |
Yes |
Business Period |
57 years |
|
IPO |
- |
International Ins. |
- |
|
Public |
- |
Rating |
A (65) |
|
Related
Company |
|||
|
Relation
- Subsidiaries |
Country
|
Company
Name |
Sterling Abrasives Limited [ |
|
Note |
- |
||
2. Summary
Financial Statement
|
Balance Sheet as of |
31.03.2010 |
(Unit: Indian Rs.) |
|
|
Assets |
Liabilities |
||
|
Current Assets |
2,091,040,000 |
Current Liabilities |
1,246,510,000 |
|
Inventories |
1,191,540,000 |
Long-term Liabilities |
2,824,410,000 |
|
Fixed Assets |
3,457,220,000 |
Other Liabilities |
429,240,000 |
|
Deferred Assets |
--- |
Total Liabilities |
4,500,160,000 |
|
Invest& other Assets |
2,049,000,000 |
Retained Earnings |
4,101,930,000 |
|
|
|
Net Worth |
4,288,640,000 |
|
Total Assets |
8,788,800,000 |
Total Liab. & Equity |
8,788,800,000 |
|
Total Assets (Previous Year) |
8,862,690,000 |
|
|
|
P/L Statement as of |
31.03.2010 |
(Unit: Indian Rs.) |
|
|
Sales |
7,310,100,000 |
Net Profit |
580,130,000 |
|
Sales(Previous yr) |
6,519,000,000 |
Net Profit(Prev.yr) |
597,170,000 |
MIRA
INFORM REPORT
|
Report Date : |
26.02.2011 |
IDENTIFICATION DETAILS
|
Name : |
CARBORUNDUM UNIVERSAL LIMITED |
|
|
|
|
Registered Office : |
Parry House, |
|
|
|
|
Country : |
|
|
|
|
|
Financials (as on) : |
31.03.2010 |
|
|
|
|
Date of Incorporation : |
21.04.1954 |
|
|
|
|
Com. Reg. No.: |
18-318 |
|
|
|
|
CIN No.: [Company
Identification No.] |
L29224TN1954PLC000318 |
|
|
|
|
TAN No.: [Tax
Deduction & Collection Account No.] |
CHEC00173F |
|
|
|
|
PAN No.: [Permanent
Account No.] |
AAACC2474P |
|
|
|
|
Legal Form : |
Public Limited Liability Company.
The company’s shares are listed on the Stock Exchanges |
|
|
|
|
Line of Business : |
Manufacturing and Selling of Abrasives Grinders Like Grinding Wheels
and Coated Abrasives, Refractories such as Super Refractories (Fired) / (Castable),
Electrocast Refractories, Electrominerals such as white Aloxite Grains, Brown
Aloxite Grains, Silicon Carbide Grains, Calcined Bauxite, etc. |
RATING & COMMENTS
|
MIRA’s Rating : |
A (65) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
Maximum Credit Limit : |
USD 17150000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a well established and a reputed company having fine track.
Financial position of the company appears to be sound. Trade relations are
reported as fair. Business is active. Payments are reported to be regular and
as per commitments. The company can be considered normal for business dealings at usual
trade terms and conditions. |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – April 1, 2010
|
Country Name |
Previous Rating (31.12.2009) |
Current Rating (01.04.2010) |
|
|
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
LOCATIONS
|
Registered Office : |
Parry House, |
|
Tel. No.: |
91-44-25211652 / 25306789 / 42216789 |
|
Fax No.: |
91-44-25230706 / 42216149 |
|
E-Mail : |
mmm@cumiho.rpgms.ems.vsnl.net.in |
|
Website : |
|
|
|
|
|
Factory : |
Abrasives a. 655, Tel : 91-44-25733322 / 42211000 Fax : 91-44-25733499 / 25733280 / 25731027 b. Plot No.48, SIPCOT Industrial Complex, Hosur 635 126, Dharmapuri
District, Tel: 91-4344-276864 / 277059 / 276630 / 279855 / 279844 Fax: 91-4344-277060 c. Gopalpur Chandigarh, P.O. Ganga Nagar, Kolkata-700132, West Tel : 91-33-25384418 Fax : 91-33-25386331 d. C-4 and C-5, Kamarajar Salai, MMDA Industrial Complex, Maraimalai
Nagar 603 209, Kanchipuram District, Tel : +91-4114-253093 / 253195 Fax : +91-4114-253097 e. F-1/2, F2 - F5, SIPCOT Industrial Park, Pondur “A” Village,
Sriperumbudur - 602 105, Kanchipuram District, Tamilnadu, India Tel: 91-44-37100204 Fax : 91-4114-253097 f. K3, ASAHI Industrial Estate, Latherdeva Hoon, Mangalore Jhabrera
Road, PO Jhabrera, Tehsil Roorkee, Hardwar District, Uttranchal-247667,
India Tel: 91-1332, 275846 / 224064 Fax : 91-1332 224062 g. Power Tools Division, Plot No.77, Bommasandra, Jigani Link Road,
Jigani Industrial Area, Jigani, Bangalore-526106, Karnataka, India Tel: 91-80-27839041/42/43/44 Fax : 91-80-27839040 Ceramics a. Plot No.47, SIPCOT Industrial Complex, Hosur-635126, Dharmapuri
District, Tel : 91-4344-276027 / 276418 Fax : 91-4344-276028 b. Plot No A-7/2 MIDC Area, Chikalthana, Tel : 91-240-2482568 Fax : 91-240 2482003 c. Super Refractories Division, Plot No.102 and 103, SIPCOT Industrial
Complex (Phase II), Ranipet-632403, Tel : 91-4172-244582 / 244197 Fax : 91-4172-244982 d. Super Refractories Division – Plant 2, Vinnampalli Post, Katpadi Taluk,
Vellore District – 632516, Tel : 91- 4172 – 255397/ 646030 Fax :91- 4172 – 255395 e. Plot Nos. 35,37, 48-51, Adhartal Industrial Estate,
Jabalpur-482004, Madhya Pradesh, India Tel : 91-761-2680398 / 6539996 Fax: 91-761-2680678 Electrominerals a. PB No.1 Kalamassery,Development Plot P.O, Kalamassery-683109,
Ernakulam District, Tel : 91-484-2541058/ 2540309/2540525 Fax : 91-484-2532019 b. PB No. 3 Nalukettu, Koratty-680308, Trichur District, Tel : 91-480-2732313 /2732061 Fax : 91-480-2732821 c. Maniyar Hydroelectric Works, Maniyar P.O., Vadasserikara,
Pathanamthitta District, Kerala-689662, Tel : 91-4735-274223 Fax : 91-4735-274223 d. Bhatia Mines, Bhatia Western Railway, Jamnagar District,
Gujarat-361315, Tel : 91-2891-233464 e. P.B No.2 Tel : 91-2892-262063 / 262065 Fax : 91-2892-262061 |
DIRECTORS
AS ON 31.03.2010
|
Name : |
Mr. M.M. Murugappan |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Mr. K. Srinivasan |
|
Designation : |
Managing Director |
|
|
|
|
Name : |
Mr. Subodh Kumar Bhargava |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. T.L. Palani Kumar |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. K. Srinivasan |
|
Designation : |
Managing Director |
|
|
|
|
Name : |
Mr. Sridhar Ganesh |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Shobhan M. Thakore |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. M. Lakshminarayan |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Sanjay Jayavarthanavelu |
|
Designation : |
Director |
|
|
|
|
Management
Committee: |
|
|
Name : |
Mr. K. Srinivasan |
|
Designation : |
Managing Director |
|
|
|
|
Name : |
Mr. N. Kishore |
|
Designation : |
President - Abrasives and Technology |
|
|
|
|
Name : |
Mr. P.R. Ravi |
|
Designation : |
President – Industrial Ceramics |
|
|
|
|
Name : |
Mr. V. Ramesh |
|
Designation : |
Chief Financial Officer |
|
|
|
|
Name : |
Mr. M. Muthiah |
|
Designation : |
Senior Vice President – Human Resources |
|
|
|
|
Name : |
Mr. P. L. Deepak Dorairaj |
|
Designation : |
Senior Vice-President (Operations) - Abrasives |
|
|
|
|
Name : |
Mr. N. Ananthaseshan |
|
Designation : |
Senior Vice-President - Electro Minerals Division |
|
|
|
|
Name : |
Mr. R. Rajagopalan |
|
Designation : |
Senior Vice-President - Refractories and Prodorite |
KEY EXECUTIVES
|
Name : |
Mr. S. Dhanvanth Kumar |
|
Designation : |
Company Secretary |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
AS ON 31.12.2010
|
Category
of Shareholders |
No. of Shares |
Percentage |
|
(A) Shareholding of Promoter
and Promoter Group |
|
|
|
|
|
|
|
|
5821706 |
6.24 |
|
|
33647682 |
36.04 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(B) Public Shareholding |
|
|
|
|
|
|
|
|
8110504 |
8.69 |
|
|
24588 |
0.03 |
|
|
6869357 |
7.36 |
|
|
11320458 |
12.12 |
|
|
|
|
|
|
|
|
|
|
3491583 |
3.74 |
|
|
|
|
|
|
|
|
|
|
15280020 |
16.37 |
|
|
7855712 |
8.41 |
|
|
|
|
|
|
|
|
|
|
35178 |
0.04 |
|
|
4001 |
-- |
|
|
907443 |
0.97 |
|
|
|
|
|
Total |
93368232 |
100.00 |
(1) Indian
Individuals / Hindu Undivided Family
Individual shareholders holding nominal
share capital up to Rs.0.100 millions BUSINESS DETAILS
|
Line of Business : |
Manufacturing and Selling of Abrasives Grinders Like Grinding Wheels
and Coated Abrasives, Refractories such as Super Refractories (Fired) / (Castable),
Electrocast Refractories, Electrominerals such as white Aloxite Grains, Brown
Aloxite Grains, Silicon Carbide Grains, Calcined Bauxite, etc. |
||||||||
|
|
|
||||||||
|
Products : |
|
PRODUCTION STATUS (AS ON 31.03.2010)
|
Particulars |
Unit |
Installed
Capacity |
Actual
Production |
|
Abrasives |
|
|
|
|
Bonded |
Tonne |
19640 |
15328 |
|
Coated |
In million sqm |
17.86 |
9.04 |
|
Industrial
Cloth |
Metre |
4500000 |
2451886 |
|
Ceramics |
|
|
|
|
Industrial
Ceramics |
Tonne |
5870 |
3598 |
|
Refractories |
Tonne |
36450 |
26057 |
|
Electrominerals |
|
|
|
|
Grains |
Tonne |
25340 |
22706 |
GENERAL INFORMATION
|
No. of Employees : |
1584 |
||||||||||||||||||||
|
|
|
||||||||||||||||||||
|
Bankers : |
|
||||||||||||||||||||
|
|
|
||||||||||||||||||||
|
Facilities : |
# - includes amounts repayable within one year, Rs.346.290 millions
@ includes amount repayable within one year-Nil |
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
Deloitte Haskins and Sells Chartered Accountants |
|
Address : |
Chennai, |
|
|
|
|
Memberships : |
Confederation of Indian Industry |
|
|
|
|
Subsidiaries : |
|
|
|
|
|
Associates : |
Laserwords Private Limited [Laserwords] |
|
|
|
|
Joint Ventures : |
|
CAPITAL STRUCTURE
AS ON 31.03.2010
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
125,000,000 |
Equity Share |
Rs.2/- Each |
Rs.250.000 millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
107,193,000 |
Equity Share * |
Rs.2/- Each |
214.390 |
|
13,839,000 |
Less: Shares bought
back from the shareholders pursuant to the offer for buy-back of shares made
in 2000-01 |
Rs.2/- Each |
(27.680) |
|
2232 |
Add: 2232 shares allotted during the year under Employee Stock Option Scheme 2007 93,356,232 shares (previous year 93,354,000) of Rs.2 each
fully paid |
Rs.2/- Each |
0.004 |
|
|
Total |
|
186.714 |
NOTE
* Includes
- 893,565 shares of Rs.2 each allotted as fully paid up for consideration other than cash pursuant to contracts
- 2,339,295 shares of Rs.2 each allotted to shareholders of amalgamated companies
- 82,825,120 shares of Rs.2 each allotted as fully paid up
bonus shares by capitalisation of share premium and general reserve
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
186.710 |
186.710 |
186.710 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
4101.930 |
3721.850 |
3332.040 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
4288.640 |
3908.560 |
3518.750 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
2648.060 |
2872.760 |
2267.270 |
|
|
2] Unsecured Loans |
176.350 |
593.410 |
726.930 |
|
|
TOTAL BORROWING |
2824.410 |
3466.170 |
2994.200 |
|
|
Long Term Lease
Liability |
13.940 |
13.550 |
15.840 |
|
|
DEFERRED TAX
LIABILITIES |
415.300 |
368.230 |
282.610 |
|
|
|
|
|
|
|
|
TOTAL |
7542.290 |
7756.510 |
6811.400 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
3457.220 |
3500.870 |
2640.410 |
|
|
Capital work-in-progress |
330.640 |
208.660 |
605.900 |
|
|
|
|
|
|
|
|
INVESTMENT |
1718.360 |
1721.710 |
1697.680 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
1191.540
|
1165.470 |
945.570 |
|
|
Sundry Debtors |
1600.220
|
1529.640
|
1322.860
|
|
|
Cash & Bank Balances |
61.320
|
343.210
|
169.710
|
|
|
Other Current Assets |
0.000
|
0.000
|
0.000
|
|
|
Loans & Advances |
429.500
|
393.130
|
460.170
|
|
Total
Current Assets |
3282.580
|
3431.450 |
2898.310 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
720.690
|
587.600 |
|
|
|
Other Current Liabilities |
315.150
|
305.030
|
815.710
|
|
|
Provisions |
210.670
|
213.550
|
215.190
|
|
Total
Current Liabilities |
1246.510
|
1106.180 |
1030.900 |
|
|
Net Current Assets |
2036.070
|
2325.270
|
1867.410
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
7542.290 |
7756.510 |
6811.400 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
7310.100 |
6519.000 |
5830.100 |
|
|
|
Income from Work Bills and Services |
71.060 |
59.140 |
38.220 |
|
|
|
Profit on |
5.240 |
291.400 |
567.520 |
|
|
|
Other Income |
236.000 |
62.110 |
279.000 |
|
|
|
TOTAL (A) |
7622.400 |
6931.650 |
6714.840 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Raw Material Consumed |
3141.370 |
2699.710 |
2265.230 |
|
|
|
Employee Cost |
807.690 |
764.840 |
692.990 |
|
|
|
Other Costs |
2287.420 |
2130.780 |
2026.690 |
|
|
|
Accretion to Stock |
(47.890) |
(94.140) |
(63.040) |
|
|
|
TOTAL (B) |
6188.590 |
5501.190 |
4921.870 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
1433.810 |
1430.460 |
1792.970 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
238.690 |
271.880 |
169.060 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
1195.120 |
1158.580 |
1623.910 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
353.420 |
297.780 |
252.070 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
841.700 |
860.800 |
1371.840 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
261.570 |
263.630 |
400.140 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
580.130 |
597.170 |
971.700 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
1602.080 |
1309.430 |
650.090 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
300.000 |
59.720 |
67.170 |
|
|
|
Tax on Debenture Redemption Reserve |
31.250 |
31.250 |
0.000 |
|
|
|
Dividend |
210.670 |
213.550 |
125.190 |
|
|
BALANCE CARRIED
TO THE B/S |
1640.290 |
1602.080 |
1309.430 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Export Earnings |
1338.120 |
1345.750 |
848.030 |
|
|
|
Royalty |
2.370 |
1.830 |
1.440 |
|
|
|
Dividend and Interest |
30.520 |
20.670 |
12.720 |
|
\ |
|
Management Fees |
22.470 |
17.370 |
0.000 |
|
|
TOTAL EARNINGS |
1393.480 |
1385.620 |
862.190 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
1362.110 |
1286.850 |
1015.860 |
|
|
|
Components and Spare Parts |
21.840 |
13.390 |
14.070 |
|
|
|
Capital Goods |
130.980 |
153.120 |
226.480 |
|
|
TOTAL IMPORTS |
1514.930 |
1453.360 |
1256.410 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
6.21 |
6.40 |
10.41 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2010 |
30.09.2010 |
31.12.2010 |
|
Type |
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
|
Sales Turnover |
1960.600 |
2381.500 |
2430.200 |
|
Total Expenditure |
1632.000 |
1893.400 |
1954.500 |
|
PBIDT (Excl
OI) |
328.600 |
488.100 |
475.700 |
|
Other Income |
71.400 |
31.900 |
0.400 |
|
Operating
Profit |
400.000 |
520.000 |
476.100 |
|
Interest |
52.300 |
47.000 |
49.500 |
|
Exceptional
Items |
234.900 |
8.100 |
0.000 |
|
PBDT |
582.600 |
481.100 |
426.600 |
|
Depreciation |
99.400 |
101.000 |
103.300 |
|
Profit
Before Tax |
483.200 |
380.100 |
323.300 |
|
Tax |
125.800 |
111.600 |
87.100 |
|
Reported PAT |
357.400 |
268.500 |
236.200 |
|
Extraordinary Items |
0.000 |
0.000 |
0.000 |
|
Prior Period Expenses |
0.000 |
0.000 |
0.000 |
|
Other Adjustments |
0.000 |
0.000 |
0.000 |
|
Net Profit |
357.400 |
268.500 |
236.200 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
PAT / Total Income |
(%) |
7.61 |
8.62 |
14.47 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
11.51 |
13.20 |
23.53 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
12.49 |
12.42 |
24.78 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.20 |
0.22 |
0.39 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.95 |
1.17 |
1.14 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
2.63 |
3.10 |
2.81 |
LOCAL AGENCY FURTHER INFORMATION
HISTORY
Subject is a largest high alumina ceramic manufacturing company
in
ECONOMIC OVERVIEW
The year 2009-10 began on a difficult note. There was a significant slowdown in the economic growth rate in the second half of 2008-09, following the financial crisis that began in the advanced economies in 2007-08 which spread to the real economy across the world. The world witnessed the deepest global downturn in recent history and there was apprehension that the deceleration in the economy would persist for some time, as the full impact of the economic slowdown worked through the system of the developing economies.
It was also a year of reckoning for the policymakers across the globe, who had taken a calculated risk in providing substantial fiscal stimulus to counter the negative fallout of the global slowdown.
As a result of the fiscal measures taken, global production
and trade started recovering in the second half of 2009. Confidence rebounded
on both the financial and real fronts, as extraordinary policy support
forestalled another Great Depression. In advanced economies, the beginning of a
turn in the inventory cycle contributed to positive developments. Finally
domestic demand was strong in key emerging and developing economies, although
the turn in the inventory cycle and the normalization of global trade also
played an important role. World output registered a drop of 0.6% with all major
regions showing a decline - US at (2.4%), Euro zone at (4.1%) and
The continued recession in the developed world, for the better part of 2009-10, meant a sluggish export recovery and a slowdown in financial flows into the domestic economy. Yet, over the span of the year, the Indian economy posted a remarkable recovery. The real turnaround came in the second quarter of 2009-10 when the economy grew by 7.9%. As per the advance estimates of GDP for 2009-10, released by the Central Statistical Organisation (CSO), the economy is estimated to have grown at 7.2% in 2009-10, with the industrial and the service sectors growing at 8.2% and 8.7% respectively. One of the highlights of the recovery was the renewed momentum in the manufacturing sector, which had seen continuous decline in the growth rate for almost eight quarters since 2007-08. Manufacturing sector growth had more than doubled from 3.2% in 2008-09 to 8.9% in 2009-10. Further the recovery in GDP growth for 2009-10, was broad based. Seven out of eight sectors/ sub-sectors showed a growth rate of 6.5% or higher.
COMPANY PERFORMANCE OVERVIEW
Net Sales grew by 12% with domestic sales registering an increase of 15%. Exports were at last year’s levels.
The recessionary trends that engulfed the world in 2008 had its debilitating impact on the Company’s sales growth during the first two quarters of the year both in the domestic and international markets. Despite the weak sentiment, the Company managed to register a growth of 3% in its turnover for the first six months compared to prior year levels. The Company, however, registered quarter on quarter growth commencing from the fourth quarter of 2008-09.
From October onwards, the mood became upbeat and confidence returned steadily to the markets. Growth was primarily driven by the domestic markets with the buoyancy in the Indian economy resulting in stepped up consumption in several sectors of the economy. There was good off-take from several user industry segments including auto, auto components, bearing, steel and general engineering. However project orders were not so encouraging as several major projects got postponed, particularly for Super Refractories. As a result, sales for the second half of the year registered a growth of 21% compared to the corresponding period of 2008-09.
Export sales however continued to be subdued due to the sluggish demand from European and North American markets which continued to be impacted by the recession. The export competitiveness was also gradually being eroded by the steady appreciation of the Indian rupee during the year. However a few of the Asian markets offered some relief. Further some of the export product lines, catering to select industry sectors, remained relatively less impacted by the downturn. Despite the weak markets overseas and the appreciating rupee, exports sales were maintained at last year levels of Rs.1359 million.
Aided by the buoyancy in the second half of the year, all business segments registered double digit growth rates for the full year.
There were largely no steep upward movements in the prices and availability of inputs. However since the economy was just returning to normalcy, pricing was under pressure, with all players trying to capture the shrinking pie.
Capital expenditure during the year was about Rs.442 million, with investment primarily in establishment of the facility for manufacture of Silicon Carbide microgrits, which was at an advanced stage of completion in the Cochin Special Economic Zone, as of the year end. The Anti corrosives project in Katpadi Taluk, Tamil Nadu, which was executed in a phased manner, has been fully completed. Apart from the new investments, the Company made considerable progress in getting the desired benefits from the various capital expenditure projects commissioned in the past few years.
Operating Earnings before interest, depreciation and tax (EBITDA) margins increased by 25% primarily due to 12% top line growth coupled with control on fixed costs and prudent foreign exchange hedging policy. Depreciation was higher by Rs.56 million as a result of the full year effect of capital expenditure projects completed in 2008-09. Interest costs were lower by 12% (i.e. Rs.239 million versus Rs.272 million) as a result of the soft interest rate regime and efficient working capital management. Profit on sale of fixed assets was lower at Rs.5 million during the year as compared to the previous year (Rs.291 million). Consequently, profit before tax was lower at Rs.842 million, as compared to Rs.861 million during the previous year.
FINANCIAL POSITION
Shareholders funds as on 31st March 2010 was Rs.4289 million. Addition for the year (excluding proposed dividend) was Rs.380 million.
Year end debt levels (Rs.2838 million) comprises long term borrowings of Rs.2152 million and short term borrowings of Rs.686 million. Borrowings have reduced by Rs.641 million during the year. As a result the debt-to-equity ratio has improved to a comfortable 0.66 (from 0.89 last year).
Net fixed assets were at Rs.3788 million (previous year Rs.3710 million). The total capital expenditure for the year was Rs.442 million which exceeded the depreciation of Rs.353 million for the year. Investments (which are mainly into the Company’s subsidiaries and joint ventures) were at Rs.1718 million (at about last year levels). The focus on working capital management paid rich dividends with net current assets (excluding bank balances and dividend provisions) marginally declining from Rs.2196 million to Rs.2185 million despite a Rs.803 million increase in sales.
PERFORMANCE OF BUSINESS SEGMENTS
MARKET SCENARIO
Abrasives business started the year on a challenging note with a negative growth of 2% in sales during the first half of the year. The global slowdown in major user segments adversely impacted export sales. Despite a moderate and patchy recovery in second half of the year, the Company with its complete range of products has been able to service a wider clientele and was able to enhance domestic market share in industries like construction, fabrication, bearing, wood working, agriculture, surgical instruments etc., with niche products and enlarging product offerings in the mass markets. The division ended the year with a sales growth of 11% over last year. However export sales were lower than last year because of the subdued European and North American markets.
The channel dynamics changed during the year, with tighter
supply-replenish flow and also flattening of margins as most of the global
players have been entering into high growth economies like
The Company continued to pursue a “Grow their Market” strategy by addressing all tiers of the market at their respective price points by an appropriate combination of brand and product. Long term market power was enhanced by strengthening the core segments and near adjacencies.
Generic product development especially in the areas of speciality resinoid products has given the lead over competition in terms of performance price parity. Growth in super abrasives and thin wheels was encouraging with the supply and development of a slew of new products. Technological differentiation continued to remain hallmarks of the Company’s competitive strategy for the future.
The Indian abrasives industry continues to be largely
catered by the two leading players but many global abrasive manufactures have
entered the Indian market, due to slowdown in the
MANUFACTURING
Manufacturing capability was established for a new range of products viz. rice polishing wheels, ultra thin sleek wheels and cup wheels to meet the emerging market requirements for these products.
The Thiruvottiyur bonded abrasives facility functioned well to cater to the volume requirements of the market, from the second quarter onwards. With the pace of industrial activity picking up in the latter part of the year, the plant rendered good support to service the orders for non standard bonded abrasive products from various user industries. The plant won the first place at the TPM competition conducted by ABK-AOTS. The plant also has been recertified as per the revised ISO standard i.e. ISO 9001:2008 version.
The Hosur bonded abrasives plant achieved “self certification status” from a major customer. The plant received the certification under the revised standard ISO 9001:2008. One man and one machine was implemented in a module to improve productivity.
The Uttarkhand abrasives facility is progressing well to become a full fledged manufacturing hub by increasing its product spread. A facility for manufacture of individual coated discs has been commissioned and the coated conversion facilities set up in the previous year have stabilized operations.
The Sriperumbudur coated abrasives facility optimised operations and improved plant efficiency by 4%. Coated abrasives Jumbo Production was increased by 10% and conversion by 14%. Reduction in specific energy consumption and fuel consumption was achieved. The plant was re-certified for new ISO 9001:2008 quality system.
Cost increases for certain inputs were witnessed for brief periods as a result of strengthening of the Euro currency and demand-supply mismatch. Barring this there were no major increases in cost of inputs during the year. However there was difficulty in implementing the price increases which were initiated to cover the cost push which had taken place during the end of the previous financial year. With competitors competing on price and consequently the product mix tilting more towards the lower margin economy range products, operating margins showed a decline.
Due to supply constraints, power cut was imposed on industries in Tamil Nadu during the year. The adverse impact was minimized to some extent, using the captive power procured from the power plant operated by the Company’s subsidiary. The restrictions imposed for a few months, resulted in the division having to resort to higher cost alternatives.
To sustain market growth in the face of stiff challenges in the market place and cost push of input materials the business strived to reduce the impact on operating profits by tight working capital management apart from focused cash management and operational excellence.
POWER TOOLS
In Power tools division, it was a year of internal consolidation and realigning the business strategy based on an understanding of the market gained during the first 18 months of operations. Product lines were critically reviewed and rationalized both based on the market response and also an assessment of CUMI’s strengths in various segments. Marketing efforts were also focused on specific areas and markets rather than dispersing efforts over a wider area. As a result of this approach, sales for the year (at Rs.71 million), registered 14% increase over the previous year (Rs.62 million).
As a result of the product and customer rationalization, inventory and receivable levels declined and consequently cash generation was healthy.
CERAMICS
The Ceramic Division operates in three niche segments i.e. high alumina ceramics, super refractories (fired and monolithics) and anti corrosive products.
HIGH ALUMINA CERAMICS
MARKET SCENARIO
Industrial Ceramics offers Alumina and Zirconia products of technical ceramic grades addressing wear protection, electrical resistance, thermal protection and ballistic protection requirements.
Despite experiencing the global downturn from the third quarter of 2008-09, high alumina Ceramics business achieved an overall growth of 23%. The domestic business grew by 13% and 31% growth was achieved in exports.
In domestic business, all major projects in targeted segments were deferred owing to economic slow down. However the focused approach to servicing repair and maintenance requirements of customers helped growth of domestic business. The repair and maintenance segment saw a growth of 51%. Also focus on coal washery segment in offering end to end wear protection solutions for coal washing saw a 200% growth in this segment.
Growth in exports business was mainly in metallised cylinders. The process of seeking product approvals which began in 2008-09 paid rich dividends and orders were secured from major global manufacturers of vacuum interrupters. Focused approach on timely delivery coupled with reliable products helped the division to win best new supplier award from a global leader in vacuum interrupters.
The wear protection business to Europe and
MANUFACTURING
The automated wear resistant liner plant in Hosur (near
Robust processes helped deliver consistent products to
customers. New products in varying geometries were manufactured to meet
customers’ requirement. The flexible manufacturing process helped in addressing
various dimensional requirements in different markets (imperial scale for
Six sigma quality initiatives introduced in 2008-09 were stabilized during the year and these helped to deliver Six sigma compliant wear resistant liners to customers.
The state-of-the-art metallised ceramics plant that was commissioned in September 2008 to address the requirements of the power transmission industry has fully stabilized and is operating to its capacity. Processes have been put in place to ensure delivery of consistent and reliable metallised cylinders to customers.
The division received ISO 14000 certification during the year. Its environmental management system has been certified by TUV NORD.
During the year new products were developed to address corrosion and wear protection applications in mining and high thermal shock applications in casting operations.
SUPER REFRACTORIES AND ANTI-CORROSIVE PRODUCTS
MARKET SCENARIO
The Super Refractory segment grew by 4%. The growth was largely driven by off-take from iron and steel, cement, carbon black and non ferrous segments. Demand from ceramics, glass and chemical process Industry continued to be subdued. HT insulator industry continued to be affected by lower capacity utilization because of recessionary conditions. The glass industry projects were shelved or postponed in view of the sluggish off-take from their customers, particularly in the early part of the year. Competition from imports intensified in a few product categories.
Anti Corrosives registered a 9% growth. The growth mainly came from increase in sales of acid resistant cement products and polymer concrete cells.
MANUFACTURING
The new Super Refractories plant in Katpadi Taluk, Tamilnadu which was commissioned last year has gone into full fledged operation. The plant incorporates advanced production processes and equipments which are designed to deliver cost advantage and high quality products. The plant, with its capability to fire products at 18000C, would supplement the operations of the existing Fired Refractories plant in Ranipet.
In order to combat the competitive price pressures, the division worked on reducing cost through in-process improvements and alternate sourcing of raw material and supplies.
The
The new facility in Katpadi Taluk, Tamil Nadu for
manufacture of 10,000 tonnes of anti-corrosive products viz. acid resistant
products, construction chemicals and polymer concrete cells has become fully
operational. The plant obtained EIL’s approved vendor status for all anti
corrosive products and played a pivotal role in bolstering the revenues of the
business. A new acid resistant product was developed and established to
international standards during the year. TPM initiatives were intensively
implemented. ISO 9001-2008 certification was received by both the new facility
and Ranipet plant. There has been no material change in the ceramics industry
structure in
ELECTROMINERALS
MARKET SCENARIO
The domestic business environment was very positive with good demand for the regular products like fused alumina and silicon carbide for abrasives, refractories and blasting applications. The momentum was driven by the strong off-take from end user industries like engineering, auto, fabrication and steel, particularly from the third quarter.
In the export markets, the division made an entry into new
markets in North America, Middle East, Far East and
carbide microgrits and by developing processes to yield shape specific powders for meeting market requirements.
All product segments registered growth with the exception of the silicon carbide microgrits for the photovoltaic industry which was sluggish in the last two quarters of the year.
The market structure remained largely unchanged in
MANUFACTURING
To meet the demand, volumes were increased at all locations by increasing throughputs from existing processes.
There was some increase in raw material costs, though not very major. To counter this, cost reduction efforts in the form of alternative sourcing of raw materials and services and reduction in freight charges were undertaken yielding substantial savings. Inventory levels of raw materials increased due to higher feedstock of Silicon Carbide arising from delay in commissioning of the new Silicon Carbide Mircogrit facility.
The Koratty plant of the division received ISO 14000
certification during the year. The plant was placed in
The first phase of the Silicon Carbide Microgrit facility at Cochin Special Economic Zone has been completed and has commenced commercial production in April 2010. Subsequent phases would be implemented based on market conditions.
FINANCE
The crisis in the global financial sector which erupted in
the second half of 2008-09 with impact spread across both the developed and emerging
markets eased considerably in 2009-10. The interest rates which shot up in the
second half of 2008-09, started steadily declining from second quarter of
current year. The demand for credit was subdued in the developed countries,
while in
The Company’s focus on cash generation along with lower capital expenditure resulted in a strong liquidity position throughout the year. One tranche of the external commercial borrowing repayment of Rs.364 million was made as per schedule. During the year, the Company relied on short term foreign currency loans which were, on an average, about 1.5% cheaper compared to rupee loans. Overall, the borrowings reduced by Rs.641 million during the year.
All foreign currency borrowings, except an amount of USD 5 million, have been fully hedged against exchange fluctuation and interest rate risks.
Due to lower borrowing levels, soft interest rate regime and optimal sourcing of funds, interest costs showed a declining trend, quarter on quarter.
The appreciating rupee during the year impacted export realisations. The Company followed a disciplined and conservative approach to foreign exchange hedging which resulted in a net gain of Rs.8 million.
The Company continued to retain its strong credit ratings viz. ‘P1+’ for short term borrowings and ‘AA+ Stable’ for long term borrowings, both from CRISIL. All debt obligations were serviced on time.
INTERNAL CONTROL
CUMI has put in place extensive internal controls to mitigate operational risks. The internal audit team periodically evaluates the adequacy and effectiveness of these internal controls, recommends improvements and also reviews adherence to policies and corrective action taken to address any gaps.
Capital and revenue expenditure are monitored and controlled with reference to approved budgets.
Investment decisions are subject to formal detailed evaluation and approval according to schedule of authority in place in the Company. Review of capital expenditure undertaken with reference to benefits forecasted is done. Physical verification of assets is periodically undertaken.
BUSINESS OUTLOOK
In 2010, world output is expected to rise by about 4.25%, following a 0.6% contraction in 2009. The global recovery has evolved better than expected, with activity recovering at varying speeds - tepidly in many advanced economies but solidly in most emerging and developing economies. Economies that are off to a strong start are likely to remain in the lead, as growth in others is held back by lasting damage to financial sectors and household balance sheets. Money markets have stabilized. Corporate bond and equity markets have rebounded. In advanced economies, the tightening of bank lending standards is ending, and the credit crisis appears to be bottoming out.
Activity remains dependent on highly accommodative macroeconomic policies and is subject to downside risks, as fiscal fragilities have come to the fore. Many emerging economies are again growing rapidly and a number have begun to moderate their accommodative macroeconomic policies in the face of high capital inflows. Given prospects for relatively weak growth in the advanced economies, the challenge for emerging economies is to absorb rising inflows and nurture domestic demand without triggering a new boom-bust cycle.
The Company would strive to ride the wave of growth in the
domestic market by leveraging its existing well oiled manufacturing infrastructure. The continuing appreciation
of the Indian Rupee would increase the competitive pressure and profitability
on export sales. Concerted action to improve profit margins are underway by
reorienting product mix, acquiring capability for manufacturing value added
products, increasing market penetration and getting efficiencies up and driving
down costs. With Asia leading the global economic recovery and
With these efforts the Company is confident of continuing to ride the growth trajectory.
AS PER WEBSITE
DETAILS
CORPORATE GROUP
MURUGAPPA GROUP
Headquartered in Chennai, the Rs.159070 millions (USD 3.14
billion) Murugappa Group is one of
The business has its origins in 1900, when Dewan Bahadur A M Murugappa
Chettiar established a money-lending and banking business in
Some of the country's best-known brands like BSA and Hercules in
bicycles, Parrys Spirulina and Parrys Beta Carotene in nutraceuticals, Parrys
Pure in sugar, Carborundum and Ajax in abrasives, Gromor and Paramfos in
fertilisers, and many more come from the Murugappa Group. Focussing on its
research and development innovations, it has registered 43 international
patents.
The group has grown consistently through its decisive and visionary
response to changing times. Its pioneering efforts, steadfast commitment to
ethical business practices and its dogged pursuit of new areas to extend its
business acumen have brought in its wake several prestigious national and
international awards. Social commitment has always been the cornerstone of the
group's ethos and it has been at the forefront of eco-conservation, public
health, and education in the communities where its companies operate. It runs
several educational and health care institutions on charitable lines. Besides,
the group runs a research and development centre for rural development, the Sri
AMM Murugappa Chettiar Research Centre (MCRC), which has been designing simple,
cost-effective technologies for local artisans.
The group is also the first business group in Asia to have been awarded
the 'IMD Distinguished Family Business Award' by the internationally renowned
Management Development Institute located in
Management
BOARD OF DIRECTORS
Mr. M M
Murugappan, Chairman
Masters in
Chemical Engineering
Past Positions - Managing Director, CUMI, President,Parry Agro Industries
Limited,
Currently - Chairman of Tube Investments of India Limited,
Director of Mahindra and Mahindra Limited, Infotech Enterprises Limited, etc.
Mr. Subodh Kumar
BhargavaNon Executive Director
Graduate in
Mechanical Engineering
Past Positions -Chairman and Chief Executive of the Eicher Group.
Currently - Chairman of VSNL and Wartsila
Mr. T L Palani
KumarNon Executive Director
Graduate in Chemical
Engineering, post-graduate diploma in business administration.
Past Positions - Chief Executive of New
Currently - Country Head -
Mr. A VellayanNon Executive Director
Masters degree in
business studies
Past Positions - Managing Director of Tube Investments of India Limited, TI
Diamond Chain Limited
Currently - Vice Chairman, Murugappa Corporate Board, Chairman of E.I.D Parry
India Limited, Coromandel Fertilisers Limited,
Mr. Sridhar GaneshNon Executive Director
Alumni of the
Indian Institute of Management,
Past Positions - Learning and Devt. Director, Cadbury Schweppes plc,
Director - HR, Cadbury India Limited, General Manager - HR, Berger Paints
Limited
Currently - Director - HR, Murugappa Group
Mr. Shobhan
ThakoreNon Executive Director
Bachelor of Arts
(Politics) and Bachelor of Law from
Solicitor High Court, Mumbai and Solicitor Supreme Court of
Past Positions - Partner of Bhaishanker Kanga and Girdharlal, Advocates and
Solicitors
Currently - Partner, Talwar, Thakore and Associates., Director of Alkyl Amines
Chemicals Limited, Bharat Forge Limited, Carraro India Limited, and Morarjee
Textiles Limited,
Mr. M
LakshminarayanNon Executive Director
Master of
Technology in Mechanical Engineering with distinction from Indian Institute of
Technology (IIT)
Past Positions - Joint Managing Director of Bosch Limited
Currently - Director of Rane (Madras) Limited, and Pricol Limited
Mr. K SrinivasanManaging Director
Graduate in
Mechanical Engineering
Past positions - Vice President of Wendt India Limited and CUMI
Currently-CEO of the Company since January 2005.
MANAGEMENT COMMITTEE
CUMI’s Management Committee, steers the organisation to meet overall
objectives within the boundaries set by the Board of Directors. The
Committee comprises: K Srinivasan (50) - Managing Director,
A post graduate in engineering from IIT, Chennai, has over 30 years of
experience in the industry. He has been with CUMI since 1995.
P R RaviPresident
– Ceramics and EMD
A cost accountant and a post graduate in management from the
V Ramesh Chief Financial
Officer
A Cost Accountant and alumni of Indian Institute of Management,
M Muthiah Vice President – HR
An alumni of the
Madurai Institute of Social Work, Madurai and a Masters in Business
Administration with over 25 years of experience in the industry. He has been
with CUMI for over 12 years.
PRESS RELEASE
CUMI Standalone
top line up by 3% and PBT up by 15% Consolidated PAT up by 6%
Chennai, October
30, 2009: The Board of Directors met today and approved the unaudited financial
results for the quarter ended 30th September 2009.
Q2 Financial Overview
With the Indian economy showing signs of recovery, sales for the quarter at
Rs.1840 millions were 3% higher over the corresponding quarter of previous year. In the
export markets, the Company benefited from the niche market approach adopted in
certain product lines, which helped it to maintain export sales at the same
level as the previous year, despite the impact of the recession continuing to
linger in the overseas markets. On a sequential basis, a sale for Q2 was 13%
higher than Q1 of 2009-10.
Operating EBITDA grew by 14% (Rs.350 millions vs Rs.308 millions). EBITDA margins
also improved to 19% from 17.3%. Depreciation was higher by Rs.17 millions (Rs.91 millions versus Rs.74 millions) as a result of
the capital expenditure undertaken during the previous year. Interest cost was
lower at Rs.59 millions (previous year Rs.66 millions) as a result of
the soft interest rates prevailing in the economy.
Profit before tax grew by 15% over the corresponding quarter of last year
(Rs.222 millions vs Rs.193 millions). Net profit grew by 11% (Rs.149 millions vs 134 millions).
PERFORMANCE OF BUSINESS SEGMENTS
With the Indian economy showing early signs of recovery, the Abrasives business
performed well in meeting the peak sales performance of last year. In the
direct customer segment, all major user industry segments registered good
off-take. Sales for the quarter at Rs.1090 millions was at last year
levels. While off-take was good in the domestic market, the international sales
continued to be lack-lustre, with sluggish demand from the European and North
American customers.
The Ceramics business registered a 5% growth in sales (Rs.460 millions versus Rs.440 millions), aided by the
strong performance of the Industrial Ceramics business (particularly Metallised
Cylinders). Metallised Cylinders business has gathered good momentum with
capacity utilization nearing peak levels. The products have gained good
acceptance with several reputed customers. Sales of other Industrial Ceramics
products was lower as there was a mixed performance from major user industries.
While demand from power generation / distribution, cement and coal washery segments
were good, order incoming from other market segments was lower. Efforts to
address price sensitive market segments are yielding results. Sales of Super
Refractories (including anti-corrosives business) was at last year levels. The
new Super Refractories plant near Ranipet has stabilized production. Order
incoming for fired products was lacklustre, as several customers were operating
well below their peak capacities and also because of postponement of capital
investments by some user industries.
The Electro-Minerals business continued its strong performance, with a 11%
growth in sales over Q2 of last year (Rs.400 millions vs Rs.360 millions). Market for
Brown Fused Alumina is positive with both abrasive and refractory customers
commencing purchases. In Silicon Carbide microgrits, the addressable market
segments were impacted by regulatory changes, inventory reductions at customer
end and competition from substitute products. The project for establishment of
a Silicon Carbide microgrit facility in the Cochin SEZ is progressing well.
Given the current market conditions, it has been decided to implement the
project in four phases. The first phase will be commissioned in November 2009.
CONSOLIDATED PERFORMANCE
Consolidated Sales (incl. that of Joint Ventures) were Rs.3250 millions (Rs.3360 millions for Q2 of 08-09).
While Electro-Minerals sales were maintained at last year levels (Rs.1200 millions vs. Rs.1180 millions), the abrasives
segment registered lower sales (Rs.1310 millions vs Rs.1530 millions) with the Russian
and North American industrial sector showing no signs of recovery. Sales
performance of the overall Ceramics segment was flat (Rs.570 millions vs. Rs.590 millions) compared to the
previous period. Strong performance in the Australian market helped offset the
lower sales in the North American markets.
Volzhsky Abrasive Works,
EBITDA was at Rs.610 millions (previous year Rs.570 millions), with EBITDA
margins increasing from 17% to 19%. As a result of the improved EBITDA margins
and the benefit of lower interest costs, profit before tax increased by 13%
(Rs.450 millions vs Rs.400 millions). Consolidated PAT grew by 6% (Rs.265 millions versus Rs.250 millions).
OUTLOOK
While there are strong indications both from the government and industry that
the Indian economy is emerging out of economic slowdown, the global market place
is yet to experience signs of an economic revival. In
Carborundum
Universal's Consolidated Q3 PAT up 56%
Chennai, 27th January 2011: The Board of Directors met today and approved the results for the quarter ended 31* December 2010.
Consolidated Q 3
financial Performance
Consolidated Net Sales grew by 25% to Rs.4080.000 Millions from Rs.3270.000 Millions. Growth was largely driven by abrasives, which grew by 62%. Ceramics registered a growth rate of around 11%. About 53% of Company's consolidated sales continue to accrue from exports & overseas operations.
EBITDA (excl other I exceptional income) grew by 20% from Rs.620.000 Millions to Rs.740.000 Millions. PBlT grew by 22% from Rs.510.000 Millions to Rs.620.000Millions.
Profit before tax was Rs.550.000 Millions - an increase of 23% over the previous year figure of Rs.450.000 Millions. Consequently profit after tax grew by 56% to Rs.370.000 Millions (previous year Rs.240.000 Millions).
Consolidated YTD
Financial Performance
Consolidated Net Sales during the 9 months of 2010-11 were at Rs.11680.000 Millions (26% growth over the same period for previous year). Profits after tax (including exceptional item of income of Rs.180.000 Millions post tax) was Rs.1214.000 Millions as against Rs.693.000 Millions for the previous year.
Consolidated
Oaeratina Performance
Abrasives
CUMl's consolidated abrasives sales registered an increase of 62% for the quarter. Sales for the quarter were Rs.1850.000 Millions (Rs.1140.000 Millions for the corresponding period of last year). The strong growth, particularly in the Indian and Russian markets, made this possible.
CUM1 Standalone abrasives registered a growth of 25% in sales driven by the buoyancy in the Indian markets. Both bonded abrasives and coated abrasives witnessed double growth rates. Strong off-take was witnessed for non standard products, both from the dealer segment and the direct customer segment. Presence in non urban markets was increased through intensified retail initiatives. The marketing efforts were complemented by strong support from the manufacturing teams. Efforts were continued to improve raw material consumption efficiencies.
Sterling Abrasives, which caters to certain select segments
of the bonded abrasives market, registered a 17% growth in sales. Wendt
In
CUM1 China registered a 42% sequential growth over 02 of current year. Apart from servicing the requirements of thin wheels and other abrasive products for the Indian and Russian operations, the Company has made good progress in developing prospective customers in other overseas markets.
Both the North American subsidiaries viz. CUM1 America and CUM1 Canada staged smart recovery in sales following improved off-take from various customer segments.
Aided by the strong growth in turnover, control on fixed costs, initiatives taken to improve raw material consumption efficiencies and also price corrections done in the market, profitability (PBIT) of the abrasives segment witnessed a steep three fold growth i.e. from Rs.90.000 Millions to Rs.285.000 Millions.
Electro Minerals
Electrominerals maintained sales at about last year levels. Sales for the quarter were Rs.1450.000 Millions (previous year Rs.1460.000 Millions). The domestic and international market for all ranges of fused minerals was positive driving on the growth trend registered by the user industries.
Silicon carbide sales of Volzhsky Abrasive Works,
In
In
Profit before interest and tax of the consolidated electro minerals business, was Rs.230.000 Millions (previous year Rs.320.000 Millions).
Ceramics
The ceramics business recorded a 11% increase in sales (Rs.850.000 Millions vs. Rs.770.000 Millions).
In
Sales of metalized cylinders registered a sequential growth of 20%. The commissioning of some balancing equipment was completed towards the end of the quarter which will yield benefits in terms of higher supply capability in the forthcoming quarters.
Exports of wear resistant tiles to the
The Company's joint ventures, in the refractory business, viz. Murugappa Morgan Thermal Ceramics Limited. and Ciria lndia Limited continued to perform well registering a 8% growth in turnover.
Profit before interest and tax of the Ceramics business segment, was lower at Rs.144.000 Millions (previous year Rs.170.000 Millions) primarily because of the drop in profitability of the Australian operations and also to some extent pricing pressures, increase in input costs, product mix issues in the Indian refractory business.
Outlook
With the mood in the domestic economy being positive and the served global market showing momentum, the Company expects the buoyancy in revenues to continue during the 4d quarter. The main challenge however will be in form of spiraling raw material prices which will be addressed through price corrections and improved efficiencies.
FIXED ASSETS
- Land
- Building
- Plant and machinery
- Vehicles
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners, controlling
shareholders or senior officers as terrorist or terrorist organization or whom
notice had been received that all financial transactions involving their assets
have been blocked or convicted, found guilty or against whom a judgement or
order had been entered in a proceedings for violating money-laundering,
anti-corruption or bribery or international economic or anti-terrorism sanction
laws or whose assets were seized, blocked, frozen or ordered forfeited for
violation of money laundering or international anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper payments
to government officials for engaging in prohibited transactions or with
designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l Anti-Money
Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
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.45.37 |
|
|
1 |
Rs.73.24 |
|
Euro |
1 |
Rs.62.68 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
6 |
|
OPERATING SCALE |
1~10 |
6 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
8 |
|
--PROFITABILIRY |
1~10 |
8 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
NO |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
65 |
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 |
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 |
|
- |
NB |
New Business |
- |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.