MIRA
INFORM REPORT
|
Report Date : |
13.01.2011 |
IDENTIFICATION DETAILS
|
Name : |
FIRSTSOURCE SOLUTIONS LIMITED |
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|
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Registered
Office : |
6th Floor, Peninsula Chambers, Ganpatrao Kadam Marg, Lower Parel,
Mumbai-400013, |
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Country : |
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Financials (as
on) : |
31.03.2010 |
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Date of
Incorporation : |
06.12.2001 |
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Com. Reg. No.: |
11-134147 |
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CIN No.: [Company Identification
No.] |
L64202MH2001PLC134147 |
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|
TAN No.: [Tax Deduction &
Collection Account No.] |
MUM104720C |
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|
Legal Form : |
A Public Limited Liability Company. The company’s Shares are listed on
stock exchange. |
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Line of Business
: |
Providing IT enabled transaction processing services. |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba (45) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal commitments. |
Satisfactory |
|
Maximum Credit Limit : |
USD 44000000 |
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|
|
|
Status : |
Satisfactory |
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Payment Behaviour : |
Usually Correct |
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Litigation : |
Clear |
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Comments : |
Subject is an established company having satisfactory track. Trade
relations are reported as fair. Business is active. Payments are reported to
be usually correct 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 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
INFORMATION DECLINED BY
|
Name : |
Mr. Yogesh Chudasama |
|
Designation : |
Finance Executive |
|
Date : |
12.01.2011 |
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|
|
|
Name : |
Mr. Vishal Shukla |
|
Designation : |
Assistant Manager – Finance |
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Contact No.: |
91-22-66660888 |
|
Date : |
12.01.2011 |
LOCATIONS
|
Registered Office : |
6th Floor, Peninsula Chambers, Ganpatrao Kadam Marg, Lower
Parel, Mumbai-400013, |
|
Tel. No.: |
91-22-66414500/ 66660888 |
|
Fax No.: |
91-22-66414548/ 66660804 |
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E-Mail : |
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|
Website : |
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Overseas Offices : |
Located at: ·
·
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DIRECTORS
As on 16.09.2010
|
Name : |
Mr. Shailesh Jayantilal Mehta |
|
Designation : |
Chairman cum Managing Director |
|
Address : |
401, |
|
Date of Birth/Age : |
22.04.1949 |
|
Date of Appointment : |
21.01.2005 |
|
|
|
|
Name : |
Mr. Ananda Ranjitkumar Mukerji |
|
Designation : |
Director |
|
Address : |
RM 1901 and 1902, 19th
Floor, A Wing, Raheja Atlantis, G Kadam Marg, Worli, Mumbai-400018, |
|
Date of Birth/Age : |
27.11.1959 |
|
Date of Appointment : |
13.02.2002 |
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|
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|
Name : |
Mr. Alexander Matthew Vallance |
|
Designation : |
Managing Director |
|
Address : |
47, |
|
Date of Birth/Age : |
29.05.1968 |
|
Date of Appointment : |
25.01.2010 |
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|
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|
Name : |
Mr. Yezdi Hrji Malegam |
|
Designation : |
Director |
|
Address : |
Goolestan, 37, Cuffe Parade, Mumbai-400005, |
|
Date of Birth/Age : |
24.09.1933 |
|
Date of Appointment : |
27.07.2006 |
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|
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|
Name : |
Mr. William Charles Smith Miller |
|
Designation : |
Director |
|
Address : |
4A, |
|
Date of Birth/Age : |
07.11.1939 |
|
Date of Appointment : |
19.08.2002 |
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|
|
|
Name : |
Mr. Kanarath Payattiyath Balaraj |
|
Designation : |
Director |
|
Address : |
304, Embassy Eros, No. 7, |
|
Date of Birth/Age : |
18.01.1970 |
|
Date of Appointment : |
02.09.2003 |
|
|
|
|
Name : |
Mr. Ram V Chary |
|
Designation : |
Director |
|
Address : |
1854, |
|
Date of Birth/Age : |
22.03.1971 |
|
Date of Appointment : |
27.10.2009 |
|
|
|
|
Name : |
Mr. Mohit Nareshchandra Bhandari |
|
Designation : |
Director |
|
Address : |
A-42, Kavi Apartments, Worli, Mumbai-400018, |
|
Date of Birth/Age : |
12.02.1977 |
|
Date of Appointment : |
09.01.2009 |
|
|
|
|
Name : |
Mr. Donald JR William Layden |
|
Designation : |
Managing Director |
|
Address : |
6300, Washington Circle, Wauwatosa-53213, |
|
Date of Birth/Age : |
02.12.1957 |
|
Date of Appointment : |
20.04.2006 |
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|
|
|
Name : |
Mr. Pravir Balbir Vohra |
|
Designation : |
Director |
|
Address : |
701, ICICI Apartments, Near |
|
Date of Birth/Age : |
18.05.1954 |
|
Date of Appointment : |
27.07.2010 |
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|
|
|
Name : |
Mr. Ashok Sekhar Ganguly |
|
Designation : |
Chairman cum Managing Director |
|
Address : |
N6 Pemi No. |
|
Date of Birth/Age : |
28.07.1935 |
|
Date of Appointment : |
17.04.2002 |
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Date of Ceasing: |
27.07.2010 |
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|
|
|
Name : |
Mrs. Lalita Dileep Gupte |
|
Designation : |
Managing Director |
|
Address : |
153, MNhaskar Building, Opposite Ruia College, Sir Bhalchandra Road, Matunga,
Mumbai-400019, Maharashtra, India |
|
Date of Birth/Age : |
04.10.1948 |
|
Date of Appointment : |
14.08.2007 |
|
Date of Ceasing: |
27.07.2010 |
KEY EXECUTIVES
|
Name : |
Mr. Sanjay Gupta |
|
Designation : |
Secretary |
|
Address : |
D2, 10-5, Millennium Towers, Sector 9, Sanpada, Navi Mumbai,
Thane-400705, Maharashtra, India |
|
Date of Birth/Age : |
27.11.1964 |
|
Date of Appointment : |
01.04.2007 |
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|
Board Committee/ Audit Committee : |
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Compensation cum Board Governance Committee : |
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Investor Grievance Committee : |
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|
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|
Name : |
Ms. Vrinda Walavalkar |
|
Designation : |
Senior Vice President, Corporate Communication |
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|
Name : |
Mr. Sanjiv Dalal |
|
Designation : |
Chief Technology Officer |
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|
|
Name : |
Mr. Aashu Calapa |
|
Designation : |
President HR and Country |
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|
|
|
Name : |
Mr. Carl Saloanha |
|
Designation : |
Global Chief Financial Officer |
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|
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|
Name : |
Mr. Sanjeet Singha |
|
Designation : |
Head- BFSI |
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|
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|
Name : |
Mr. Tom Watters |
|
Designation : |
Head- Healthcare |
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|
Name : |
Mr. Chandra Iyer |
|
Designation : |
Head- Aisa Business Unit |
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|
Name : |
Mr. Chandeep Singh |
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Designation : |
EVP, Process Excellence |
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|
Name : |
Mr. Santanu Nandi |
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Designation : |
Head- Telecom and Media |
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|
Name : |
Mr. Mathew Vallance |
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Designation : |
Chief Executive Officer Designate |
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|
Name : |
Mr. Yogesh Chudasama |
|
Designation : |
Finance Executive |
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|
Name : |
Mr. Vishal Shukla |
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Designation : |
Assistant Manager – Finance |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 30.09.2010
|
Names of Shareholders |
No. of Shares |
Percentage |
|
(A) Shareholding of Promoter and Promoter Group |
|
|
|
|
|
|
|
|
7,585,705 |
1.76 |
|
|
83,649,599 |
19.45 |
|
|
91,235,304 |
21.21 |
|
|
|
|
|
Total shareholding of Promoter and Promoter Group (A) |
91,235,304 |
21.21 |
|
(B) Public Shareholding |
|
|
|
|
|
|
|
|
19,277,967 |
4.48 |
|
|
191,445 |
0.04 |
|
|
36,203,617 |
8.42 |
|
|
55,673,029 |
12.95 |
|
|
|
|
|
|
31,690,824 |
7.37 |
|
|
|
|
|
|
64,127,248 |
14.91 |
|
|
17,147,520 |
3.99 |
|
|
170,191,132 |
39.57 |
|
|
170,191,132 |
39.57 |
|
|
283,156,724 |
65.84 |
|
Total Public shareholding (B) |
338,829,753 |
78.79 |
|
Total (A)+(B) |
430,065,057 |
100.00 |
|
(C) Shares held by Custodians and against which Depository Receipts
have been issued |
- |
- |
|
Total (A)+(B)+(C) |
430,065,057 |
100.00 |
(1) Indian
Bodies Corporate
Individual shareholders holding nominal share
capital up to Rs. 0.100 MillionBUSINESS DETAILS
|
Line of Business : |
Providing IT enabled transaction processing services. |
GENERAL INFORMATION
|
No. of Employees : |
Approximately 24860 |
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Bankers : |
ABN Amro Bank N.A., Nariman Point, Mumbai, |
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Facilities : |
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Banking Relations
: |
-- |
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Auditors : |
|
|
Name : |
B S R and Company Chartered Accountant |
|
Address : |
5th Floor, Lodha Excelus, Apollo Mills Compound, N M Joshi
Marg, Mahalaxmi, Mumbai-400011, |
|
|
|
|
Parties with Substantial Interests : |
|
|
|
|
|
Subsidiaries : |
Rev IT Systems Private Limited U7230MH2002PTC162305 Pipal Research Analytics and Information Services India Private
Limited U73100DL2004PTC1227658 ·
Firstsource Group USA Inc ·
Firstsource Solutions UK Limited ·
Pipal Research Corporation ( ·
Medassist Holding Inc ( ·
Firstsource Business Process Services LLC ( ·
Firstsources Solutions S.A. ( ·
Medassist LLC ( ·
Firstsource Advantage LLC ( ·
Firstsource Financial Solutions LLC ( |
CAPITAL STRUCTURE
As on 31.03.2010
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
850000000 |
Equity Shares |
Rs. 10/- each |
Rs. 8500.000 Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
429209682 |
Equity Shares (During the year 1020000 (31 March 2009:
876718) options were allotted) |
Rs. 10/-
each |
Rs. 4292.097
Millions |
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 |
4292.097 |
4281.897 |
4273.130 |
|
|
2] Share Application Money |
3.450 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
6738.331 |
6290.008 |
2019.662 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
11033.878 |
10571.905 |
6292.792 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
1265.093 |
1342.434 |
103.991 |
|
|
2] Unsecured Loans |
10791.583 |
12084.993 |
11137.356 |
|
|
TOTAL BORROWING |
12056.676 |
13427.427 |
11241.347 |
|
|
DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
230900.554 |
23999.332 |
17534.139 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
1110.177 |
1368.182 |
1087.200 |
|
|
Capital work-in-progress |
62.567 |
69.271 |
60.873 |
|
|
|
|
|
|
|
|
INVESTMENT |
11106.872 |
18647.006 |
17011.767 |
|
|
DEFERREX TAX ASSETS |
303.686 |
246.171 |
193.056 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
0.000
|
0.000 |
0.000 |
|
|
Sundry Debtors |
994.305
|
1436.739 |
1086.740 |
|
|
Cash & Bank Balances |
118.403
|
153.124 |
311.763 |
|
|
Other Current Assets |
326.977
|
319.972 |
195.073 |
|
|
Loans & Advances |
8833.638
|
1981.591 |
1504.266 |
|
Total
Current Assets |
10273.323
|
3891.426 |
3097.842 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
429.676
|
710.974 |
365.550 |
|
|
Other Current Liabilities |
141.328
|
450.859 |
206.590 |
|
|
Provisions |
331.788
|
197.612 |
4481.180 |
|
Total
Current Liabilities |
902.792
|
1359.445 |
5053.320 |
|
|
Net Current Assets |
9370.531
|
2531.981 |
[1955.478] |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
Amalgamation deficit adjustment account |
1136.721 |
1136.721 |
1136.721 |
|
|
|
|
|
|
|
|
TOTAL |
23090.554 |
2399.332 |
17534.139 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income from Services |
6521.492 |
5660.439 |
4896.378 |
|
|
|
Other Operating Income |
95.741 |
[125.455] |
42.708 |
|
|
|
Other Income |
214.789 |
445.258 |
107.794 |
|
|
|
TOTAL (A) |
6832.022 |
5980.242 |
5046.880 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Personnel Costs |
3302.090 |
2758.919 |
2363.322 |
|
|
|
Operating Costs |
2106.092 |
1890.571 |
1558.798 |
|
|
|
TOTAL (B) |
5408.182 |
4649.490 |
3922.120 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
1423.840 |
1330.752 |
1124.760 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
277.781 |
676.412 |
123.155 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
1146.059 |
654.340 |
1001.605 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
524.380 |
522.446 |
532.820 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
621.679 |
131.894 |
468.785 |
|
|
|
|
|
|
|
|
|
Less |
TAX (I) |
[51.649] |
[19.171] |
[107.646] |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-I) (J) |
673.328 |
151.065 |
576.431 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
1611.736 |
1460.671 |
884.240 |
|
|
|
|
|
|
|
|
|
|
BALANCE CARRIED
TO THE B/S |
2285.064 |
1611.736 |
1460.671 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
|
|
|
|
|
|
Basic |
1.57 |
0.35 |
1.35 |
|
|
|
Diluted |
1.51 |
0.35 |
1.24 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
30.06.2010 |
30.09.2010 |
|
Type |
|
1st
Quarter |
2nd
Quarter |
|
Net Sales |
|
1645.770 |
1753.550 |
|
Total Expenditure |
|
1443.770 |
1447.360 |
|
PBIDT (Excl OI) |
|
202.000 |
306.190 |
|
Other Income |
|
33.190 |
48.520 |
|
Operating Profit |
|
235.190 |
354.710 |
|
Interest |
|
[45.350] |
0.000 |
|
Exceptional Items |
|
0.000 |
0.000 |
|
PBDT |
|
280.540 |
354.710 |
|
Depreciation |
|
130.870 |
132.970 |
|
Profit Before Tax |
|
149.670 |
221.740 |
|
Tax |
|
16.040 |
9.780 |
|
Provisions and contingencies |
|
0.000 |
0.000 |
|
Profit After Tax |
|
133.630 |
211.960 |
|
Extraordinary Items |
|
0.000 |
0.000 |
|
Prior Period Expenses |
|
0.000 |
0.000 |
|
Other Adjustments |
|
0.000 |
0.000 |
|
Net Profit |
|
133.630 |
211.960 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
PAT / Total Income |
(%) |
9.86
|
2.53 |
11.42 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
9.53
|
2.33 |
9.57 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
5.46
|
2.51 |
11.20 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.06
|
0.01 |
0.07 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
1.17
|
1.40 |
2.59 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
11.38
|
2.86 |
0.61 |
LOCAL AGENCY FURTHER INFORMATION
DETAILS OF SUNDRY
CREDITORS
(Rs.
In Millions)
|
Particulars |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
Sundry Creditors |
|
|
|
|
Due to other than micro and small enterprises |
|
|
|
|
- For expenses |
373.363 |
561.836 |
255.796 |
|
- For capital goods |
56.313 |
149.138 |
109.754 |
|
Total |
429.676 |
710.974 |
365.550 |
RESULTS OF
OPERATIONS
The standalone total income
increased from Rs.5,980.2 Million to Rs.6,832 Million, a growth of 14.2% over
the previous financial year. The standalone Profit After Tax increased from
Rs.151.1 Million to Rs.673.3 Million, up by 345.6% over the previous financial
year. The Net Profit of the Company in the previous financial year was
negatively impacted on account of non-cash mark to market loss on Foreign
Currency Convertible Bonds (FCCBs) amounting to Rs.778.2 Million and mark to
market foreign exchange loss on undesignated derivative financial instruments
of Rs.236.2 Million. There was also a net gain of Rs.635 Million on account of
FCCBs buyback of USD 49.7 Million in financial year 2008-09 as compared to a
net gain of only Rs.73.9 Million in financial year 2009-10 on account of
buyback of FCCBs worth USD 12.9 Million. Besides the impact of the above
factors, the increase in net profits in the financial year 2009-10 was
primarily due to business growth in international business delivered offshore
and domestic business in
INCREASE IN SHARE
CAPITAL
During the year, the Company issued
1,020,000 equity shares of the face value of Rs.10 each on the exercise of stock
options under the Employee Stock Option Schemes of the Company. Consequently,
the outstanding, issued subscribed and paid-up equity share capital of the
Company increased from 428,189,682 shares to 429,209,682 shares of Rs.10 each
as of March 31, 2010.
REPURCHASE OF
FOREIGN CURRENCY CONVERTIBLE BONDS
The Company had issued Zero Coupon
Foreign Currency Convertible Bonds (FCCBs) of USD 275 Million in December 2007.
The FCCBs have a maturity period of 5 years and 1 day. The FCCBs are listed on
Singapore Exchange Securities Trading Limited. During the financial year
2009-10, the Company repurchased and cancelled its FCCBs of the nominal amount
of USD 12.9 Million to avail the benefits of the prevailing discount in the
rates of FCCBs. Upto March 31, 2010, the Company had repurchased and cancelled
its FCCBs of the nominal amount of USD 62.6 Million. The repurchase was made at
an average discount of 46% and was funded out of External Commercial Borrowings
(ECB) from ICICI Bank,
GLOBAL DELIVERY
FOOTPRINT
The Company, on a consolidated basis
had 42 global delivery centers as of March 31, 2010. The centers are located
across
During the year, the Company
incurred capital expenditure of Rs.480.1 Million mainly towards refurbishment and
maintenance of delivery centers and creation of additional capacity in
AWARDS AND
ACCOLADES
The Company received the following
awards and accolades during the year:
• Winner of the UK Trade and
Investment's (UKTI) Investor of the Year award at the UK-India Business Awards.
• Recognised amongst the top 25
companies in
• Ranked amongst Top 100 companies in
the world for innovative use of IT by CIO Magazine.
• National Outsourcing Association
(NOA), UK Awards: Best Telecom, Utilities and Hi-Tech outsourcing project,
2009.
• Winner in the ‘Deployment Leader of
the Year’ category at International Quality and Productivity Center (IQPC) Six
Sigma Excellence Awards, Orlando.
• Winner in the ‘Best Process
Improvement in Service and Transaction Project’ category at IQPC Six Sigma
Excellence Awards, Orlando.
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
INDUSTRY
STRUCTURE, DEVELOPMENTS AND OUTLOOK
By the end of FY09, the global
economy was reeling under pressures emanated from the economic crisis and the
prospects for economic growth in FY10 were expected to remain muted. A year
after what many define as global economy’s worst crisis of confidence, there
seems to be growing evidence that the various strategies put in place to tide
over the economic crisis are paying off. The acute phase of the financial
crisis seems to have passed and a global economic recovery is under way.
The world economy is on the mend
with increasing number of countries having registered positive quarterly growth
of gross domestic product (GDP), along with a notable recovery in international
trade and global industrial production. World equity markets have also
rebounded and risk premiums on borrowing have fallen.
In an indication that the global
economy is recovering faster than expected, the International Monetary Fund
(IMF) has raised its calendar year 2010 world growth forecast to 4.6% in July
2010 compared to April 2010 estimate of 4.1%. IMF has indicated that the
numbers for economic activity have come in strong and a global “double dip,” or
relapse into recession, is “very unlikely”. However, growth in calendar year
2011 is expected to moderate, fueling concern that recovery is fading.
The recovery has been uneven and
conditions for sustained growth remain a bit fragile. Much of the rebound in
the real economy has been due to the strong fiscal stimulus provided by
Governments in a large number of developed and developing countries and to the
restocking of inventories by industries worldwide. Credit conditions are still
tight in major developed economies, where many major financial institutions
need to continue the process of deleveraging and cleansing their balance
sheets.
Consumption and investment demand
has remained weak and unemployment and underemployment rates continue to remain
high in most developed countries.
The overall strength of the recovery
and its durability will depend on the extent to which household and
business-sector demand strengthens over the next few quarters. The recovery is
vulnerable to slow down as the growth impact of fiscal and monetary measures
wane and the current inventory cycle runs its course. As a consequence, it will
take more time and greater efforts to make up for the significant setbacks in
the world economy.
Overall, Asian economies are
expected to recover strongly, driven by buoyant exports and stronger domestic
demand. The IMF estimate of the Asian region’s growth in calendar year 2010 is
7.5% with
The global business process
outsourcing industry is large and growing rapidly. Companies globally are
outsourcing a growing proportion of their business processes to streamline
their operations, reduce costs, create flexibility, and improve their processes
to create shareholder value. More significantly, many of these companies are
outsourcing to offshore locations such as
According to the 2010 Strategic
Review published by NASSCOM in February 2010, or the NASSCOM 2010 Strategic
Review, the global business process outsourcing (BPO) market was estimated at
USD 112.2 billion in 2009 and is projected to grow at a 7.1% compound annual
growth rate from 2009 through 2013 to USD 147.7 billion.
Overall, the Indian BPO industry has
managed to hold itself together reasonably well and has emerged stronger and
better positioned; it is still the fastest growing segment of Indian IT-ITES
industry.
There were also challenges that the
industry faced during the year, including protectionism and currency
fluctuations. As an industry that relies on exports including outsourcing and
offshoring, the sector was seriously concerned about the restrictions on trade
imposed by Western nations and currency volatility.
COMPANY OVERVIEW
Firstsource (“The Company”) is a
leading global provider of BPO services and is among
Firstsource’s Global Delivery or
“Rightshoring” methodology supports clients through over 42 service facilities
spread over
telecom companies, two of the Top 5
mobile service providers in the U.K., largest pay TV operator in the U.K.,
largest pay TV operator in Australia, three of the Top 5 mobile service
providers in India, five of the Top 10 health insurers and managed care
companies in the U.S. and over 800 hospitals in the U.S. Based on the annual
rankings by NASSCOM, the company was sixth largest BPO provider in India in
fiscal 2009 in terms of revenues. The Black Book of Outsourcing ranks
Firstsource in Top 10 for 2009 Top Cross-Industry Business Process Outsourcing
Vendors.
The Company provides a comprehensive
range of services to clients across the customer life cycle in each of its
focus industries. The Company has in-depth domain knowledge in these industries
with proven expertise in transferring business operations from its clients to
its delivery centers and in administering, managing and further improving these
processes for its clients.
OPPORTUNITES AND
THREATS
The Industry Structure, Development
and Outlook section has described the potential of the BPO industry. It is
important to note that the BPO industry is still in its early stages of
evolution with less than 5% of the total addressable market being captured.
Key growth drivers and opportunities
for the company for profitable growth include:
• Cost and regulatory pressures in
current economic environment
• Strong growth in global BPO spend
generating continuing demand for its services
• Increasing number of organizations
globally are outsourcing business processes in an effort to simplify their
organization, create flexibility and increase efficiencies
• Increasing focus on customer
service, creating new and innovative products and services and reduce
time-to-market their products and services.
• Increasing focus on accuracy and
timeliness of processing thereby reducing transaction costs The Company
believes the following business strengths would allow it to compete and grow
successfully in the BPO industry:
• In-depth understanding of industry
domain is critical for a BPO service provider to be able to offer any
meaningful value proposition to its clients. The Company’s industry vertical
aligned structure has further strengthened its domain expertise in its chosen
verticals. The Company believes that this will continue to be a key market
differentiator for its services.
• Clients are more comfortable
partnering with large players with scale and operational expertise with a
continuous focus on quality of service delivery, ability to manage aggressive
growth and stringent security norms. The Company’s believes its BPO market
leadership is key to help it tap the growth potential of the industry. The
Company’s diversified business model with established relationships with large
global companies, including over 20 “Fortune Global 500”, “Fortune 500” and
“FTSE 100” companies also puts it at a competitive advantage compared to other
offshore BPO providers.
• In order to successfully leverage
the global BPO opportunity, flexibility in geographical delivery is an
important factor. Some processes can’t be offshored due to process complexities
and regulatory requirements. Clients increasingly look for business partners
who can deliver services across different geographies. The Company’s
established global delivery footprint enables it to deliver a wide range of
services and deepen relationships with existing customers.
• As per the NASSCOM-Perspective
2020 study, Banking and Financial services, Insurance and Telecommunications
industries are expected to be approximately 50% of the total addressable export
opportunity of USD 340–360 billion. The above again is aside from the domestic
BPO opportunity from India of USD 60-65 billion and the Healthcare provider
addressable market outside of India of USD 50-55 billion, both of which the
company operates in. The Company’s strategic positioning and scale in its
target industry sectors of BFSI, telecommunications and media, healthcare and
specific focus on
Fixed Assets:
·
Domain Name
·
Software
·
Computers
·
Networking
Services Equipments
·
Furniture
and Fixtures and Office Equipments
·
Leasehold
Improvements
·
Vehicles
AS PER WEBSITE
Profile:
Firstsource is a leading global provider of business process outsourcing
(BPO) services offering a wide range of services across banking and financial
services, telecommunications and media and the healthcare industry. Firstsource
provides services throughout the customer lifecycle, including customer
acquisition, customer care, billing and collections, transaction processing and
business research and analytics.
Firstsource leverages its Rightshoring approach that is best suited to
clients’ business. They offer the benefit of the global delivery model across
42 world class centers and over 24,000 employees across
Founded in 2001, Firstsource has quickly risen to the top of the BPO and
contact center industry and built a reputation for high quality service and
proven results. Firstsource has been ranked by NASSCOM amongst top 10 ITES-BPO
companies in
Firstsource is listed on
Firstsource provides Business Process
Outsourcing (BPO) services across the customer life cycle that cover:
· Customer Acquisition
·
Customer Care
·
Transaction Processing
·
Accounts Receivable Management / Collections
They offer customized business process management solutions across key
industries:
- Banking
Financial Services and Insurance
- Healthcare
- Telecommunications
and Media
Firstsource has leading global clients including 35 Fortune 2000
companies. The Clients include:
·
Twenty Fortune 500 companies
·
Eight FTSE 100 Companies
·
Three of the 5 largest
·
Nine of the 10 largest
·
One of the top 5
·
Two of the largest Indian banks
·
Two of the world’s top 10 telecom companies
·
Three leading Indian mobile services providers
·
FTSE 100 media company
·
Five of top 10
·
Two of the largest Blue Cross Blue Shield companies
·
Over 1000 leading hospitals in the
BOARD OF
DIRECTORS:
Dr. Shailesh Mehta
Dr. Shailesh J. Mehta, has been on the Firstsource board since 2005 as
non-executive independent director. He is a founder and managing general
partner of Granite Hill Capital Partners, an India-focused private equity fund.
He is former Chairman and CEO of Providian Financial Corp. Dr. Mehta joined the
founding team of Providian Financial and successfully built it to a Fortune 300
company with over US$30 billion in assets and over 18 million customers. He has
also been general partner with Invesco funds and operating general partner of
Sequoia
Ananda Mukerji is the Vice Chairman of Board of Directors of
Firstsource. He has over 23 years experience, working in a number of areas
including project finance, corporate finance and investment banking. His
association with the ICICI Group spans over a decade during which he set up and/or
managed a number of new businesses for the group including the infrastructure,
structured finance and advisory businesses. He has also been CFO of Enron India
Limited and Group CFO of BPL Communications Limited
Ananda has a Post Graduate Diploma in Management (PGDM) from the Indian
Institute of Management (IIM),
Matthew Vallance is Managing Director and CEO of Firstsource Solutions Limited.
Since March 2009, he has been responsible for the company’s Telecoms and Media
and BFSI businesses globally, prior to which he was responsible for
establishing the company’s presence in the
Prior to joining CustomerAsset, he founded an offshoring advisory
business, before which he held various leadership positions in the area of
technology marketing and communications, including two years as head of the
Indian subsidiary of Text 100 Plc.
Matthew holds a Diploma in Marketing from the Chartered Institute of
Marketing and a Bachelor of Arts (Honours) degree in European Business Studies
from
Mohit Bhandari is a Director at Temasek Holdings Advisors India Private Limited
("THAIPL") where he is part of the direct investment advisory team
providing consultancy services to Temasek Holdings in
Prior to joining Temasek Holdings Advisors India Private Limited in
March 2008, Mohit was with DSP Merrill Lynch as part of the Investment
Banking/MandA team for 8 years. Mohit holds Computer Engineering degree from
Mr. Ram Chary leads FIS' Global Commercial Services. In his role, he manages
businesses important to Company growth and profitability related to global
contact center operations off-shore resource and technology opportunities and
Global supply chain operations. Mr. Chary joined FIS in 2007 from the
acquisition of eFunds, where he led the Company's Professional Services
Organization. Prior to eFunds, he had a 13 year career at IBM Global Services
in both Infrastructure outsourcing and technology consulting and served in a
number of leadership roles in global operations and finance and sales. He
received his undergraduate degree in Economics from the
Pravir Vohra
Mr. Pravir Vohra, is a Certified Associate of the Indian Institute of Bankers
and a postgraduate in Economics from St. Stephen’s College,
He is the recipient of The Asian Banker Achievement Award for Technology
and Operations in 2006 and the Symantec Asia South Visionary 2008. He has also
featured on the Information Week's Global CIO 50 List for 2009. He is also a
Non Executive Director on the Board of ICICI Securities Limited.
Y.H Malegam is a Chartered Accountant from
Mr. Malegam was Chairman of the Committee appointed by the Securities
Exchange Board of India (SEBI) to review disclosure requirement in the Offer
Documents (The Malegam Committee). He was also a member of the Study Group
appointed by SEBI on accounting policies, net asset values and pricing of
mutual funds and a member of the Kumar Mangalam Birla Committee appointed by
SEBI on corporate governance. He is currently the Chairman of SEBI’s accounting
standard committee. He is also a member of the Central Board of the Reserve
Bank of
Donald W. Layden, Jr. currently serves as an advisor to Warburg Pincus,
LLC, a leading global equity firm, for its payments and transaction processing
investments. He is also a partner at Quarles and Brady, LLP, a Milwaukee,
WI-based law firm, with a focus on corporate law and complex corporate
transactions. In addition, Layden serves as a Director of Online Resources
Corporation (ORCC:NASDAQ), a
Charles Miller Smith is a senior advisor to Warburg Pincus International LLC
and is the Chairman of Scottish Power Plc. Formerly he was the Chairman of
Imperial Chemical Industries (ICI), where he joined as Chief Executive in 1994.
Prior to that, he was a Director at Unilever, where he held financial and
general management positions in the
K.P. Balaraj is a Managing Director with Sequoia Capital India. Sequoia
Capital India was formed with WestBridge Capital Partners which he co-founded
in 2000. Sequoia
Mr. Balaraj received an MBA from
AUDITED
CONSOLIDATED FINANCIAL RESULTS FOR THE QUARTER AND SIX MONTHS ENDED SEPTEMBER
30, 2010
(Rs.
In Millions)
|
Particulars |
Quarter
ended September
30, 2010 |
Six
months ended September
30 2010 |
|
|
(Audited) |
(Audited) |
|
Income from services |
4900.134 |
9658.896 |
|
Other operating income |
135.558 |
40.691 |
|
Total income
from operations |
5035.692 |
9942.733 |
|
Total expenditure |
|
|
|
Personnel costs |
3092.465 |
6090.914 |
|
Operating costs |
1237.919 |
2465.826 |
|
Depreciation and amortisation |
212.976 |
425.881 |
|
|
|
|
|
Profit before other income, finance charges, taxation and minority
interest |
492.332 |
960.112 |
|
Other income |
8.787 |
32.309 |
|
Gain on FCCB buyback, net |
-- |
-- |
|
Profit before finance charges, taxation and minority interest |
501.119 |
992.421 |
|
Finance charges, net |
85.686 |
170.389 |
|
Profit before taxation and minority interest |
415.433 |
822.032 |
|
Provision for taxation |
|
|
|
a) Current tax expense (Incl. foreign tax) |
48.348 |
161.543 |
|
b) Deferred tax charge |
63.833 |
49.262 |
|
c) Minimum alternate tax credit entitlement |
[33.085] |
[52.037] |
|
Profit after taxation and before minority interest |
336.337 |
663.264 |
|
Minority Interest |
4.198 |
10.399 |
|
Profit after taxation and minority interest |
332.139 |
652.865 |
|
Paid-up Equity Share Capital (Face Value of Share Rs.10) |
-- |
4300.651 |
|
Reserves excluding revaluation reserve |
-- |
9748.147 |
|
Earning Per Share (Rs.) (Not Annualized) : |
|
|
|
-Basic |
0.77 |
1.52 |
|
-Diluted |
0.70 |
1.37 |
|
Aggregate of non-promoter shareholding (unaudited) |
|
|
|
- Number of shares of Rs. 10 |
338829753 |
338829753 |
|
- Percentage of shareholding |
78.79% |
78.79% |
|
Promoters and promoter group shareholding |
|
|
|
a) Pledged/ Encumbered |
|
|
|
- Number of shares |
-- |
-- |
|
- Percentage of shares (as a % of the total shareholding of promoter
and promoter group) |
-- |
-- |
|
- Percentage of shares (as a % of the total share capital of the
company) |
-- |
-- |
|
b) Non-encumbered |
|
|
|
- Number of shares |
91235304 |
91235304 |
|
- Percentage of shares (as a % of the total shareholding of promoter
and promoter group) |
100.00 % |
100.00 % |
|
- Percentage of shares (as a % of the total share capital of the
company) |
21.21% |
21.21% |
|
Notes to
financials results : 1.The above results were reviewed by the Audit Committee on October 26,
2010 and adopted by Board of Directors at their meeting held on October 27,
2010. The standalone financial results for the quarter and six months ended
September 30, 2010 are available on the Company’s website
(www.firstsource.com) and the websites of BSE (www.bseindia.com) and NSE (www.nseindia.com). 2. The financial statements of the Parent Company and its subsidiaries
have been consolidated on a line-by-line basis by adding together the book
values of like items of assets, liabilities, income and expenses, after
eliminating intra-group balances/ transactions and resulting unrealised
profits in full. Unrealised losses resulting from intra-group transactions
have also been eliminated unless cost cannot be recovered. Minority
interest’s share of profits or losses is adjusted against income to arrive at
the net income attributable to the Company’s shareholders. 3. Effective year ended March 31, 2009, the company has early adopted
Accounting Standard AS-30 "Financial instruments: Recognition and
Measurement", pursuant to announcement made by the Institute of
Chartered Accountants of India (ICAI). 4. Standalone information (Audited) |
||
|
Particulars |
Quarter
ended September
30, 2010 |
Six
months ended September
30 2010 |
|
|
(Audited) |
(Audited) |
|
Total income from operations |
1753.542 |
3399.312 |
|
Profit before taxation |
221.739 |
371.410 |
|
Profit after taxation |
211.961 |
345.592 |
|
5. During the quarter, 300,000 equity shares were issued pursuant to exercise
of stock options under the Employee Stock Option Scheme of the Company 6. During the quarter, 5 complaints were received from investors which
were resolved. There were no complaints pending at the beginning and at the
end of the quarter 7. On September 22, 2010, the Company has signed an agreement for
selling the business and assets of its subsidiary “Pipal Research
Corporation”. As per the terms of the agreement, the sale is contingent upon
fulfillment of certain conditions which is in process as at September 30,
2010 8. Figures for the prior periods have been regrouped and / or
reclassified wherever considered necessary. |
||
STATEMENT
OF ASSETS AND LIABILITIES (CONSOLIDATED - AUDITED)
(Rs.
In Millions)
|
Particulars |
As
at September 30 2010 |
|
Shareholders’
funds |
|
|
Share capital |
4300.651 |
|
Share application money |
-- |
|
Reserves and surplus |
9748.147 |
|
Minority interest |
60.071 |
|
Loan funds |
14022.303 |
|
|
28131.172 |
|
Goodwill on consolidation |
20687.485 |
|
Fixed assets |
1571.418 |
|
Investments |
1208.557 |
|
Deferred tax assets, net |
7.250 |
|
Current Assets, loans and advances |
|
|
Sundry debtors |
3067.909 |
|
Unbilled receivables |
768.239 |
|
Cash and bank balances |
1310.659 |
|
Loans and advances |
2036.294 |
|
Less: Current liabilities and provisions |
|
|
Current liabilities |
1679.195 |
|
Provisions |
847.454 |
|
Net current assets |
4656.452 |
|
|
28131.172 |
SEGMENT
REPORTING
(Rs.
In Millions)
|
Particulars |
Quarter
ended September
30, 2010 |
Six
months ended September
30 2010 |
|
|
(Audited) |
(Audited) |
|
Segment Revenue |
|
|
|
a) |
1408.674 |
2681.578 |
|
b) |
2878.175 |
5808.862 |
|
c) |
561.301 |
1066.397 |
|
d) Rest of the world |
51.984 |
102.059 |
|
Total |
4900.134 |
9658.896 |
|
Less: Inter Segment Revenue |
-- |
-- |
|
Net Segment
Revenue |
4900.134 |
9658.896 |
|
Segment results before taxation and finance charges |
|
|
|
a) |
428.902 |
838.326 |
|
b) |
303.027 |
709.140 |
|
c) |
64.501 |
87.906 |
|
d) Rest of the world |
23.741 |
42.423 |
|
Total |
820.171 |
1677.795 |
|
i) Finance charges, net |
[85.686] |
[170.389] |
|
ii) Other unallocable expenditure net of unallocable Income |
[319.052] |
[685.374] |
|
Profit before taxation and minority interest |
415.433 |
822.032 |
|
|
|
|
|
Capital Employed |
|
|
|
a) |
-- |
1617.233 |
|
b) |
-- |
1579.230 |
|
c) |
-- |
585.056 |
|
d) Rest of the world |
-- |
54.629 |
|
|
|
3836.148 |
|
Notes on segment
information Primary Segments The Primary segment of the Group is geography, identified on the basis
of the location of the customer which in the opinion of management, is the
predominant source of risk and rewards. The business of the Group is organized into four key geographic
segments comprising Capital Employed Capital employed comprises of debtors and unbilled receivables,
classified by reportable segments. As the fixed assets and services are used
interchangeably between the segments by the Group's businesses and liabilities
contracted have not been identified to any of the reportable segments, the
Group believes that it is currently not practicable to provide segment
disclosures relating to these assets and liabilities. |
||
Press Release:
FOR IMMEDIATE
RELEASE
Firstsource
reports second quarter fiscal 2011 revenues of ` 5,036 million Q-o-Q growth of
2.6%, Y-o-Y growth of 3.0%
Operating EBIT of
` 492 million
Q-o-Q growth of
5.2%, Y-o-Y growth of 0.4%
PAT (profit after
tax) of ` 332 million
Q-o-Q growth of
3.6%, Y-o-Y growth of 14.0%
Mumbai, October 28, 2010: Firstsource Solutions Limited (NSE:FSL,
BSE:532809), among India’s leading pure-play BPO companies reported its
consolidated financial results for the quarter ended September 2010 according
to Indian GAAP.
Highlights for the
Quarter ended September 30, 2010
• Revenues of ` 5,036 million, up 2.6% Q-o-Q compared to ` 4,907 million
for the quarter ended June 2010 and up 3.0% Y-o-Y compared to ` 4,887 million
for the quarter ended September 2009.
• Operating EBIT (earnings before interest and tax) of ` 492 million, up
5.2% Q-o-Q compared to ` 468 million for the quarter ended June 2010 and up
0.4% Y-o-Y compared to ` 490 million for the quarter ended September 2009.
• PAT (profit after tax) of ` 332 million, up 3.6% Q-o-Q compared to `
321 million for the quarter ended June 2010 and up 14.0% Y-o-Y compared to `
291 million for the quarter ended September 2009.
• Employee strength at 24,909 as of September 30, 2010 added 212 employees
in the quarter.
• Q2 annualized attrition (post 180 days) :
·
Offshore (
·
Onshore (US and
·
Domestic – 94.2% compared to 94.9% in Q1 FY2011
• As of September 30, 2010 Firstsource derived 59% revenues from the
• As of September 30, 2010 Firstsource derived 39% revenues from Telecom
and Media,36% from Healthcare, 23% from BFSI and 2% from others.
• Key new business wins during the quarter:
·
·
Axis
Other Highlights
• During the quarter Firstsource signed an agreement to sell its 51%
holding in Pipal Research Corporation (Pipal) to CRISIL. The transaction is
expected to close in the third quarter of FY 2011.
• Firstsource inducted Sanjay Venkataraman into the Management Team as
Head of Asia Business Unit. Venkataraman takes over from Chandra Iyer who will
be leaving the company to pursue other opportunities.
Venkataraman joins from Mahindra Satyam where he was Head,
Highlights for
half-year ended September 2010
• Revenues at ` 9,943 million for the half year ended September 2010 a
growth of 2.2% over corresponding period previous year.
• Operating EBIT of ` 960 million for the half year ended September 2010
down 0.1% over corresponding period previous year.
• Profit after tax ` 653 million for the half year ended September 2010
compared to ` 671 million for corresponding period previous year.
Commenting on the performance Matthew Vallance, MD and CEO, said, “It
has been a quarter of steady performance. While the business environment
continues to improve, we have seen some delays in expected ramps and some
lengthening of the sales cycle. Under the circumstances, we are pleased that we
have closed two landmark deals during the quarter and the pipeline continues to
build up.”
Carl Saldanha, Global CFO, said, “Our operating margins expanded by 30
bps during the quarter primarily driven by improvement in domestic business
performance. Currency volatility continues to be a challenge however our
prudent hedging strategy stands us in good stead for next few quarters.”
About Firstsource
Firstsource (NSE: FSL, BSE: 532809, Reuters: FISO.BO, Bloomberg:
FSOL@IN) is a leading global provider of customized BPO services to the
Healthcare, Telecom and Media and Banking and Financial Services industries.
Its clients include Fortune 500, FTSE 100 and Nifty 50 companies. Firstsource
has a “rightshore” delivery model with operations in
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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.45.16 |
|
|
1 |
Rs.70.64 |
|
Euro |
1 |
Rs.58.68 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
5 |
|
PAID-UP CAPITAL |
1~10 |
5 |
|
OPERATING SCALE |
1~10 |
5 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
5 |
|
--PROFITABILIRY |
1~10 |
5 |
|
--LIQUIDITY |
1~10 |
5 |
|
--LEVERAGE |
1~10 |
5 |
|
--RESERVES |
1~10 |
5 |
|
--CREDIT LINES |
1~10 |
5 |
|
--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 |
|
45 |
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.