MIRA
INFORM REPORT
|
Report Date : |
25.07.2011 |
IDENTIFICATION DETAILS
|
Name : |
VARROC ENGINEERING PRIVATE LIMITED (w.e.f. 24.01.2001) |
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Formerly Known
As : |
VARROC
ENGINEERING LIMITED |
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Registered
Office : |
E-4, MIDC, Waluj,
Aurangabad – 431136, Maharashtra |
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Country : |
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Financials (as
on) : |
31.03.2010 |
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Date of
Incorporation : |
11.05.1988 |
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Com. Reg. No.: |
11-47335 |
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Capital
Investment / Paid-up Capital : |
Rs.203.475
Millions |
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CIN No.: [Company Identification
No.] |
U28920MH1988PTC047335 |
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|
TAN No.: [Tax Deduction &
Collection Account No.] |
NSKV01528C |
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PAN No.: [Permanent Account No.] |
AAACV2420J |
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Legal Form : |
Private Limited Liability Company. |
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Line of Business
: |
Manufacturer and Supplier of
Automotive Parts and Accessories. |
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No. of Employees
: |
Above 1000 people (Approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
A (59) |
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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 |
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Maximum Credit Limit : |
USD 14000000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is an established 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 dealing 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.
INFORMATION PARTED BY
|
Name : |
Mr. Ajay Lekurwale |
|
Designation : |
Accounts Officer |
|
Date : |
23.07.2011 |
LOCATIONS
|
Registered/ Corporate Office/ Factory1 : |
E-4, MIDC, Waluj,
|
|
Tel. No.: |
91-240-2556227 /
28 / 2555441 / 2564540 |
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Fax No.: |
91-240-2564540 /
2555987 / 2554487 |
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E-Mail : |
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Website : |
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Factory 2: |
K-101/102, MIDC Industrial Area, Waluj, Aurangabad-431136, |
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Factory 3: |
B-24/25, MIDC Area, Chakan Taluka Khed, District Pune-410501, |
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Factory 4: |
M-138-141, MIDC Industrial Area, Waluj, Aurangabad-431136, |
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Factory 5: |
L-6/2, MIDC Industrial Area, Waluj, Aurangabad-431136, |
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Factory 6: |
Gut No. 390, Takve-BK, Taluka Maval, District Pune-412106, |
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Factory 7: |
L-4, MIDC Industrial Area, Waluj, Aurangabad-431136, |
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Factory 8: |
Plot No. 20, Sector 9, Integrated Industrial Estate, Pantnagar,
District Udham Singh Nagar, |
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Wind Power Project: |
·
Vankusvade Site, Village Kushi/ Kusawade, Taluka
Patan, District Satara, Maharashtra, India ·
Kovdya Dongar, Village Supa, District Ahmednagar,
·
Village Badabagh, District Jaisalmer, |
DIRECTORS
AS ON 23.08.2010
|
Name : |
Mr. Sanjiv Kumar |
|
Designation : |
Whole Time
Director |
|
Address : |
Flat No. 24, 6th
Floor, Sangam B Wing, Juhu, Versova Link Road, Andheri-400053, Maharashtra,
India |
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Date of Birth/Age : |
25.06.1960 |
|
Date of Appointment : |
23.08.2010 |
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DIN No.: |
00052573 |
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Name : |
Mr. Gautam Premnath Kahndelwal |
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Designation : |
Additional Director |
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Address : |
B 2, Alaknanda, 16A, |
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Date of Birth/Age : |
01.04.1962 |
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Date of Appointment : |
24.03.2011 |
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DIN No.: |
00270717 |
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Name : |
Mr. Naresh
Chandra |
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Designation : |
Director |
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Address : |
Bhagwati Bhavan,
31-B, M. L. Dahanukar Marg, Mumbai – 400 026, |
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Date of Birth/Age : |
11.02.1935 |
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Date of Appointment : |
26.08.1988 |
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DIN No.: |
00027696 |
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|
Name : |
Mr. Tarang N.
Jain |
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Designation : |
Managing Director |
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Address : |
Halcyon Gut No.
41 (P), Opp. Walmi, |
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Date of Birth/Age : |
21.03.1962 |
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Date of Appointment : |
11.05.1988 |
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DIN No.: |
00027505 |
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Name : |
Mr. Anurag Jain |
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Designation : |
Director |
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Address : |
Green Leaf Manor, Gut No. 41-3/B, Kanchanwadi, Opp. Walmi, Aurangabad
– Paithan Road, Aurangabad – 431 005, Maharashtra, India |
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Date of Birth/Age : |
21.03.1962 |
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Date of Appointment : |
11.05.1988 |
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Name : |
Mr. Narendra
Kumar Jain |
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Designation : |
Director |
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Address : |
Flat No. 82 B 8th
Floor, Meher Aplartments, |
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Date of Birth/Age : |
15.08.1939 |
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Date of Appointment : |
09.09.1992 |
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DIN No.: |
00027735 |
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Name : |
Mr. Rajiv Devinder Singh Sahney |
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Designation : |
Director |
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Address : |
50, Ushakiran, |
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Date of Birth/Age : |
06.09.1962 |
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Date of Appointment : |
30.09.2006 |
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DIN No.: |
00022896 |
|
Other Directorship : |
·
Sahney Kirkwood Private Limited CIN No.: U32109MH1966PTC013516 ·
Rave Technologies ( CIN No.: U31900MH1998PTC117068 ·
Sahney Commutators Private Limited CIN No.: U52190KA1987PTC008214 ·
Isovolta ( CIN No.: U24110MH1982PTC026499 ·
Kanwaldeep Investments Company Private Limited CIN No.: U65990MH1978PTC020600 ·
Medusind Solutions India Private Limited CIN No.: U74140MH2001PTC133168 ·
N V Advisory Services Private Limited CIN No.: U74140MH2004PTC146033 |
KEY EXECUTIVES
|
Name : |
Mr. Sanjay Kumar Sachdev |
|
Designation : |
Secretary |
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Address : |
D-1 |
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Date of Birth/Age : |
29.12.1965 |
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Date of Appointment : |
01.04.2008 |
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PAN No: |
ABEPS8631G |
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|
|
|
Name : |
Mr. Ajay Lekurwale |
|
Designation : |
Accounts Officer |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
AS ON 23.08.2010
|
Names of Shareholders |
|
No. of Equity Shares |
|
Naresh Chandra |
|
76900 |
|
Tarang N. Jain |
|
140500 |
|
Suman N. Jain |
|
70000 |
|
Naresh Chandra
and Suman Jain |
|
15000 |
|
Tarang Jain and
Rochana Jain |
|
28100 |
|
Tarang Jain – HUF
|
|
500 |
|
Naresh Chandra –
HUF |
|
500 |
|
Varroc Polymers
Private Limited, , |
|
16000 |
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|
|
|
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Total |
|
347500 |
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||
|
Names of Shareholders |
|
No. of Preference
Shares |
|
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|
Varroc Polymers
Private Limited, |
|
20000000 |
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Total |
|
20000000 |
AS ON 07.02.2011
|
List of Allottees |
|
No. of Shares Allotted |
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Naresh Chandra |
|
1117200 |
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Tarang N. Jain |
|
4970000 |
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Suman Jain |
|
1960000 |
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Naresh Chadr and
Mrs. Suman Jain |
|
420000 |
|
Tarang Jain and
Mrs. Rochana Jain |
|
786800 |
|
Tarang Jain (HUF) |
|
14000 |
|
Naresh Chandra
(HUF) |
|
14000 |
|
Varroc Polymers
Private Limited, |
|
448000 |
|
|
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|
Total |
|
9730000 |
Equity share
breakup (percentage of total equity)
(As on
30.09.2010)
|
Category |
Percentage |
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|
|
Directors or relatives of directors |
95.40 |
|
Bodies corporate |
4.60 |
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|
|
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Total |
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer and Supplier of
Automotive Parts and Accessories. |
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Products : |
·
Magnetos ·
Coil Plates
Assembly ·
Rotors ·
C.D.I, Regular
Rectifiers and Coils ·
Rubber Items ·
Digital
Speedometers ·
Starter Motors ·
Starter Motor
Spares ·
Blinkers ·
Headlamps and Tall
Lamps ·
Rear View Mirrors ·
Air Filter Elements
and Oil Filters ·
Hoods and Acrylic
Side Sheets ·
Forging Components
(Gearsl, Shafts and Flanges) ·
Handle Bar and
Handlw Switches |
PRODUCTION STATUS AS ON (31.03.2010)
|
Particulars |
Unit |
Installed Capacity |
Actual Production |
|
Plastic Moulding Goods |
M.T |
7021 |
1782 |
|
Box Packing |
Nos. |
2152800 |
791344 |
|
Assembly and Packing |
Nos. |
4000000 |
3599315 |
|
Automobiles Seat Assembly |
Nos. |
1979120 |
578441 |
|
Tools (Moulds) |
Nos. |
-- |
0 |
|
Air Filter Assembly |
Nos. |
1925485 |
579112 |
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Fly Wheel Magneto Assembly |
Nos. |
5216700 |
3687548 |
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Capacitor Discharge Ignitions |
Nos. |
3845136 |
1918014 |
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Regulator Rectifiers |
Nos. |
4025136 |
2226356 |
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Starter Motor Assemblies |
Nos. |
1435000 |
737202 |
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Wiper Motor Assemblies |
Nos. |
462000 |
47578 |
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Handle Bar Assembly |
Nos. |
2712000 |
660181 |
|
Switches |
Nos. |
1200000 |
140279 |
|
Mirror Assembly |
Nos. |
3850971 |
581511 |
|
Exhaust Value |
Nos. |
5367149 |
3451893 |
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Inlet Valve |
Nos. |
4750000 |
3403574 |
|
Steel Forged Products |
Nos. |
21816 |
3182 |
|
Crank Pin |
Nos. |
1800000 |
1362413 |
|
Dash Board Assembly |
Nos. |
1500000 |
555838 |
|
Lamp Assembly |
Nos. |
19915000 |
5095145 |
|
Wind Power Generation |
Nos. |
18286500 |
11854261 |
Notes:
a)
The Company’s products are exempt form licensing
requirements under new industrial policy in terms of Notification No. S.O. 477
(E) Dated 25th July, 1991, hence licensed capacity not given.
b)
Installed capacity is as certified by the
Management and relied upon by the auditors, this being a technical matter.
c)
Production figures exclude production on account of
inter-unit transfers.
GENERAL INFORMATION
|
No. of Employees : |
Above 1000 people (Approximately) |
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Bankers : |
v
Citi Bank, City Group Center, C-61, Bandra Kurla Complex, Mumbai- 400 051,
Maharashtra, India v
HDFC
Bank Limited, HDFC Bank House, Senapati
Bapat Marg, Lower Parel (West), Mumbai-400 013, Maharashtra, India v
The
Saraswat Co-Operative Bank Limited, Plot No. X-23,
MIDC, Waluj, Aurangabad-431136, Maharashtra, India v
Citibank,
Parmar House,
2413, East Street, Camp, Pune – 411004, Maharashtra, India v
Corporation
Bank v
Punjab
National Bank v
IDBI
Bank Limited |
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Facilities : |
NOTES: 1. Rupee Term Loans
form Corporation Bank, Punjab National Bank and The Saraswat Cooperative Bank
Limited, FCNR (B) Loan form HDFC Bank and ECB form Citi Bank N.A., are
secured by first pari passu charge by way of hypothecation of movable fixed
assets of the company both present and future and Joint Mortgage of Immovable
Properties of the company located at Aurangabad, Pune and Uttaranchal, The
aforesaid credit facilities except faciclities form Punjab National Bank are
further secured by Corporate Guarantee of Varroc Polymers Private Limited. 2. Term Loans
from Indian Renewable Energy Development Agency Limited (IREDA Limited) are
secured by hypothecation of all specified movables including Plant and
Machinery of Wind Power projects and Equitable Mortgage of Immovable Properties
located at Vankusvade Site, Village Bhambe, Taluka Patan, District Satara,
and at Kovdya Dongar, Village Supa, District Ahmedabad and further personally
guaranteed by some of the Directors. 3. Working
capital facilities availed from Corporation Bank, Punjab National Bank, HDFC
Bank, Citi Bank and IDBI Bank Limited are secured by pari passu charge by way
of hypothecation of stock of Raw Materials, Stock in process, Finished Goods,
Consumables stores and spares, Packing Materials and Receivables of the
company both present and future situated at Aurangabad, Pune and Uttaranchal
Plant (s). 4. The creation
of some of the security at Sr. No. 1 above favouring the Banks for availing various
credit facilities was pending as at year end 31.03.2010 due to non receipt of
certain approval form statutory Authorities. However, the same have since
been created and registered after 31.03.2010.
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Banking
Relations : |
-- |
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Auditors : |
|
|
Name : |
Price Waterhouse and Company Chartered Accountant |
|
Address : |
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Subsidiaries : |
v Durovalves India Private Limited CIN No.: U34300MH1997PTC105518 v
Varroc
Exhaust Systems Private Limited CIN. No. U29100MH2005PTC151756 v
|
|
|
|
|
Step down Subsidiaries: |
v
Indudtria
Meccania E Stampaggio S.P. Zoo v
Indudtria
Meccania E Stampaggio S.P.A, |
|
|
|
|
Associates: |
v
Varroc
Polymers Private Limited v
Varroc
Trading Private Limited CIN. No. U67120MH1982PTC02669 v
Varroc
Elestomers Private Limited CIN. No. U29190MH2005PTC157474 v
Varroc
Exhaust Systems Private Limited CIN. No. U29100MH2005PTC151756 v
High
Technology Transmission System ( v
Endurance
Systems India Private Limited v
Bajaj
Omnium Varroc Private Limited v
Bajaj
Allianz General Insurance Company Limited v
Bajaj
Auto Limited v
Plastic
Ominium Varroc Private Limkited |
CAPITAL STRUCTURE
AFTER - 23.08.2010
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
1000000 |
Equity Shares |
Rs.10/- each |
Rs.10.000 Millions |
|
30000000 |
7% Redeemable Cumulative Optionally Convertible Preference Shares |
Rs.10/- each |
Rs.300.000 Millions |
|
|
|
|
|
|
|
Total |
|
Rs.310.000
Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
347500 |
Equity Shares |
Rs.10/- each |
Rs.3.475
Millions |
|
20000000 |
7% Redeemable Cumulative Optionally Convertible
Preference Shares |
Rs.10/- each |
Rs.200.000
Millions |
|
9730000 |
Equity Shares |
Rs.10/- each |
Rs.97.300
Millions |
|
|
|
|
|
|
|
Total |
|
Rs.300.775 Millions |
AS ON 31.03.2010
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
1000000 |
Equity Shares |
Rs.10/- each |
Rs.10.000 Millions |
|
30000000 |
7% Redeemable Cumulative Optionally Convertible Preference Shares |
Rs.10/- each |
Rs.300.000 Millions |
|
|
Total |
|
Rs.310.000
Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
347500 |
Equity Shares |
Rs.10/- each |
Rs.3.475
Millions |
|
20000000 |
7% Redeemable Cumulative Optionally Convertible
Preference Shares |
Rs.10/- each |
Rs.200.000
Millions |
|
20347500 |
|
|
|
|
|
Total |
|
Rs.203.475 Millions |
NOTE:
1)
Preference shares have been issued for consideration
other than cash. These are redeemable at par in three installments at the end
of 5th, 6th and 7th year respectively form
their date of allotment (December 31, 2008). Preferences shares are also
convertible at the option of allotted. The terms of conversion will be
finalized by the Board of Directors at the time of conversion.
2)
In the current year, the allotted has exercised the
option to convert 1 crore preference shares. These share were converted into
16000 equity shares on December 31, 2009 at a premium of Rs.6240/- per share as
determined by the
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 |
203.475 |
303.315 |
3.315 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
3221.262 |
1661.563 |
1461.971 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
3424.737 |
1964.878 |
1465.286 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
2330.590 |
2313.380 |
1938.895 |
|
|
2] Unsecured Loans |
342.450 |
483.497 |
338.347 |
|
|
TOTAL BORROWING |
2673.040 |
2796.877 |
2277.242 |
|
|
DEFERRED TAX LIABILITIES |
204.038 |
212.558 |
197.856 |
|
|
|
|
|
|
|
|
TOTAL |
6301.815 |
4974.313 |
3940.384 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
4026.258 |
2929.532 |
2733.925 |
|
|
Capital work-in-progress |
521.170 |
319.408 |
275.249 |
|
|
|
|
|
|
|
|
INVESTMENT |
129.200 |
1431.404 |
647.226 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
738.640
|
682.614
|
601.277 |
|
|
Sundry Debtors |
857.044
|
321.170
|
122.506 |
|
|
Cash & Bank Balances |
305.528
|
121.311
|
160.662 |
|
|
Other Current Assets |
0.000
|
0.000
|
0.000 |
|
|
Loans & Advances |
1278.211
|
575.468
|
1128.165 |
|
Total
Current Assets |
3179.423
|
1700.563 |
2012.610 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
1389.898
|
1303.791 |
1618.618 |
|
|
Other Current Liabilities |
77.064
|
46.816
|
51.214 |
|
|
Provisions |
87.274
|
55.987
|
58.794 |
|
Total
Current Liabilities |
1554.236
|
1406.594
|
1728.626 |
|
|
Net Current Assets |
1625.187
|
293.969
|
283.984 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
6301.815 |
4974.313 |
3940.384 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
|
6601.900 |
|
|
|
|
Other Income |
|
|
|
|
|
|
TOTAL (A) |
8772.700 |
6601.900 |
6456.600 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Office Expenses |
|
|
|
|
|
|
Administrative Expenses |
7490.900 |
5743.500 |
5615.300 |
|
|
|
Advertising Expenses |
|
|
|
|
|
|
TOTAL (B) |
7490.90 |
5743.500 |
5615.300 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
1281.800 |
858.400 |
841.300 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
230.400 |
257.600 |
229.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
1051.400 |
600.800 |
612.300 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
375.300 |
352.600 |
[75.900] |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
676.100 |
248.200 |
688.200 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
179.800 |
87.000 |
238.500 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
496.300 |
161.200 |
449.700 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
242.500 |
113.100 |
171.200 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
55.500 |
20.000 |
500.000 |
|
|
|
Interim Dividend On Equity Shares |
8.200 |
7.700 |
0.000 |
|
|
|
Dividend on Preference Shares |
19.300 |
5.200 |
0.000 |
|
|
|
Proposed Dividend |
0.000 |
0.000 |
6.600 |
|
|
|
Dividend Tax |
0.000 |
[1.100] |
1.100 |
|
|
BALANCE CARRIED
TO THE B/S |
655.800 |
242.500 |
113.200 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Export Earnings |
572.590 |
308.911 |
224.440 |
|
|
TOTAL EARNINGS |
572.590 |
308.911 |
224.440 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
594.836 |
422.306 |
442.700 |
|
|
|
Stores & Spares |
2.772 |
2.537 |
4.691 |
|
|
|
Capital Goods |
173.325 |
103.639 |
264.425 |
|
|
TOTAL IMPORTS |
770.933 |
528.482 |
711.816 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
24.39 |
470.47 |
1373.15 |
|
KEY RATIOS
|
PARTICULARS |
|
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
PAT / Total Income |
(%) |
5.66
|
2.44
|
6.96 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
9.38
|
5.36
|
14.50 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.20
|
0.13
|
0.47 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
1.23
|
2.14
|
2.73 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
2.05
|
1.21
|
1.16 |
LOCAL AGENCY FURTHER INFORMATION
SUNDRY CREDITORS
DETAILS:
|
Particulars |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
|
(Rs. In Millions) |
||
|
|
|
||
|
Sundry Creditors |
|
|
|
|
- Micro and small enterprises |
-- |
-- |
-- |
|
- Others than Micro and Small Enterprises |
1389.898
|
1303.791 |
1618.618 |
|
|
|
|
|
|
Total |
1389.898
|
1303.791 |
1618.618 |
PERFORMANCE:
The Performance of the company during the year has been much better than
projected. This was due to exponential growth in the domestic demand. The results
of the principal customer of the company Bajaj Auto Limited Also executed all
expectations.
The Net Sales and Other Income were higher at Rs.8772.700 Millions
against Rs.6601.900 Millions of previous year, a jump of about 33%. The Profit
before Tax increased by more than 172% and stood at Rs.676.100 Millions against
Rs.248.200 Millions.
The company has ambitious plans to grow organically as well as
inorganically. Towards its plans for inorganic growth, the company is looking
for some strategic domestic acquisition in the fiels of components for LMV LCVl
and HCVs.
EUROPEAN
OPERATIONS:
As a part of capital re-structuring, the loan advanced by the company to
its WOS Varroc European Holding B.V. (“VEHBV”) was converted to Equity. VEHBV
issued 116770 Equity Shares of Euro 100 each to the company.
The European economy is experiencing severe recession and as such all
the business are adversely affected. The European subsidiaries are not
exception to it. In order to cope with the situation of falling demand, the
company has closed down the operations at IMES,
IMES,
FUTURE OUTLOOK:
The emerging economies including
Advance tax paid by
As far as the global scenario is concerned, worries are rampant about
the impact of potential double-dip recession as a result of problem in
However, as per the available reports, there is not risk of double-dip
recession and weaker euro would be goods for the euro-zone economy in the short
term since it would help exports and gradual ruse in the Chinese Yuan could be
good for economic growth.
As per published figures released by independent agencies, the sale of
two wheelers and passenger cars in the
past half year are showing a robust upward trend as most of the two wheeler and car manufacturer
have recorded a good growth in numbers over corresponding period in the last
year. Riding on the increasing domestic demand, the company is hopeful to
improve its performance considerably during the current year. The off take by
the principal customer also indicates positive trend in the ensuring period.
The company is fully equipped to meet the stringent demand of overseas
OEM’s in terms of infrastructure, quality assurance and timely deliveries and
is taking all possible steps to expand customer base to increase exports. The
company is also exploring the possibility of setting up Joint Venture/ WOS in
The company is committed to the improvement of environment, safety,
health and society and the same has been incorporated in the Company’s Mission
Statement and Quality Policy. By way of reinforcing its commitment, the company
is taking active steps to obtain ISO 14001/OSHAS 18001 Certification in the
near future for all its plants. In the vase of VEPL-V, ISO/TS16949 audit has
been completed in January, 2010 and the certificate is awaited.
BUSINESS
DESCRIPTION
Subject is a manufacturer and
supplier of automotive parts and accessories. The company develops a range of
rear view mirrors, digital regulators, headlights and indicators. It also
manufactures various gearboxes, engine valves and catalytic inverters.
Additionally, the company owns and manages an electrical division that
manufactures generators, motors and alternators. It operates a number of
production plants to manufacture its products. The company offers product
development, installation and maintenance services. In addition, it maintains a
stock of natural rubber compounds, including housings, sheets and mudflaps.
CONTINGENT
LIABILITIES NOT PROVIDED FOR IN RESPECT OF:
|
Particulars |
31.03.2010 Rs. in Millions |
|
|
|
|
Disputed Excise and Service Tax matters |
2.684 |
|
Bills Discounted |
-- |
|
Guarantees given in respect of loans taken by subsidiaries |
212.610 |
|
Income Tax Matters |
23.274 |
|
Sales Tax Matters |
25.357 |
|
Others |
2.957 |
|
|
|
|
i) The company has imported creation machinery under the Export Promotion
Capital Goods (EPCG) Scheme and accordingly, had an export obligation of USD
361.33 Lacs (Previous Year USD 166.74 Lacs). |
|
Bankers Charges
Report as per Registry:-
|
Corporate
identity number of the company |
U28920MH1988PTC047335 |
|
Name of the
company |
VARROC
ENGINEERING PRIVATE LIMITED |
|
Address of the
registered office or of the principal place of business in |
E-4, MIDC, Waluj,
|
|
This form is for |
Creation of
Charge |
|
Type of charge |
Movable Property |
|
Particular of
charge holder |
The Saraswat
Co-Operative Bank Limited, Plot No. X-23, MIDC, Waluj, Aurangabad-431136, |
|
Nature of
instrument creating charge |
Agreement of Hypothecation
of Movable Property (For L/C on D/A basis) |
|
Date of
instrument Creating the charge |
06.12.2010 |
|
Amount secured by
the charge |
Rs.226.800
Millions |
|
Brief of the
principal terms an conditions and extent and operation of the charge |
Rate of Interest As per Bank Rules Terms of
Repayment As per Bank Rules Margin Margin: 5% Extent and
Operation of the charge The borrower do
herby hypothecate to and in favour of the Bank on exclusive charge basis all
the machineries to be imported/ procured under L/C and lying and being at
Borrower’s place of business at M-191/3, MIDC, Waluj, Aurangabad |
|
Short particulars
of the property charged |
The borrower do
herby hypothecate to and in favour of the Bank on exclusive charge basis all the
machineries to be imported/ procured under L/C and lying and being at
Borrower’s place of business at M-191/3, MIDC, Waluj, Aurangabad |
|
Corporate
identity number of the company |
U28920MH1988PTC047335 |
|
Name of the
company |
VARROC ENGINEERING
PRIVATE LIMITED |
|
Address of the
registered office or of the principal place of business in |
E-4, MIDC, Waluj,
Aurangabad – 431136, Maharashtra, India |
|
This form is for |
Modification of
charge |
|
Charge
identification number of the modified |
90227052 |
|
Type of charge |
Movable Property |
|
Particular of
charge holder |
HDFC Bank
Limited, HDFC Bank House, Senapati Bapat Marg, Lower Parel (West), Mumbai-400
013, Maharashtra, India |
|
Nature of description
of the instrument creating or modifying the charge |
Second
Supplemental Common Deed of Hypothecation of Movable Fixed Assets |
|
Date of
instrument Creating the charge |
16.11.2009 |
|
Amount secured by
the charge |
Rs.390.000
millions |
|
Brief particulars
of the principal terms an conditions and extent and operation of the charge |
Rate of Interest ROI as may be
stipulated by the Bank from time to time Terms of
Repayment As per agreed
terms with the Bank Margin Margin as may be stipulated
by the Bank from time to time Extent and
Operation of the charge First ranking
Charge by way of Hypothecation of all the present and future movable fixed
assets of the Borrower on pari-passu basis alongwith other financing Banks
situated at Waluj - Aurangabad, Takve and Chakan in Pune Distt. and Pantnagar
- Uttaranchal. |
|
Short particulars
of the property charged |
Hypothecation of
all the present and future fixed assets including but not limited to present
and future movable plant and machineries, Tool Room Equipment, Electrical
Installations, Laboratory equipments, Spares and tools etc. and other assets
lying and being at Borrowers place of business at E-4, K-101-102, M-138 -
141, L-4, L- 6/2 MIDC, Waluj, Aurangabad, Gut No. 390, Takve Bk, Taluka
Maval, District Pune and Plot No. 20, Sector 9, IIE, Pantnagar, Uttaranchal
on pari-passu basis along with other financing banks. |
|
Date of latest
modification prior to the present modification |
16.03.2007 |
|
Particulars of the
present modification |
The Total Credit
Facilities of Rs.635.000 millions have
millions and the same are now secured as First ranking charge by way of
Hypothecation of all the present and future Movable Fixed Assets on
pari-passu basis along with other financing banks situated at Waluj -
Aurangabad, Chakan and Takve in Pune Distt. and Pantnagar- Uttaranchal. |
FIXED ASSETS:-
v
Lease hold land
v
Freehold land
v
v
v
Plant and Machinery
v
Factory and Equipment
v
Computers
v
Moulds and Dies
v
Vehicles
v
Electrical fittings
v
Office Equipments
v
Furniture Fixtures
v
Tools and Instruments
PRESS RELEASE
Bank
facilities of Durovalves (India) receive higher rating by CRISIL
Equity Bites: 20 January 2011
[What follows
is the full text of the news story.]
20 January 2011 - Indian rating agency CRISIL today upgraded
the ratings on bank facilities of Durovalves (India) Private Limited to BBB+/P2
from BBB-/P3.
The agency issued the following press release:
Rs.53.6 Million Long-Term Loan BBB+/Stable (Upgraded from '
BBB-/Stable')
Rs.100 Million Cash Credit BBB+/Stable (Upgraded from '
BBB-/Stable')
Rs.100 Million Purchase Bill Discounting BBB+/Stable
(Upgraded from ' BBB-/Stable')
Rs.22.5 Million Bank Guarantee P2 (Upgraded from 'P3')
Rs.200 Million Letter of Credit P2 (Upgraded from 'P3')
CRISIL has upgraded its rating on the long-term bank
facilities of Durovalves (ndiaI) Private Limited (Durovalves, part of the
Varroc group), to 'BBB+/Stable/P2' from 'BBB-/Stable/P3'.
The upgrade in rating is driven by an expectation of strong
revenue growth for the Varroc group, which, coupled with a stable operating
margin, will result in an improvement in the group's net worth and capital
structure. The group's revenues registered growth of 50 per cent in the first
half of 2010-11 (refers to April 1 to September 30) over the first half of
2009-10; its operating margin was stable, at 13 per cent. The growth in
revenues is driven by the healthy growth in the two-wheeler industry and
increase in Bajaj Auto Limited (BAL; rated 'AAA/Stable/P1+' by CRISIL) market
share; BAL accounts for around 70 to 75 per cent of the group's revenues. The
revenues of the group are expected to register growth of 40 to 45 per cent in
2010-11 (refers to financial year, April 1 to March 31). This, coupled with a
stable operating margin, is expected to result in high net profits. As a
result, the net worth of the group is expected to increase to around Rs.4.1
billion, as on March 31, 2011, from Rs.2.8 billion, as on March 31, 2010. The
growth in net worth, coupled with moderate capital expenditure plan, is
expected to result in an improvement in gearing to around 1.0 time as on March
31, 2011 from 1.3 times as on March 31, 2010.
The ratings reflect the Varroc group's established track
record in the automotive (auto) components business, diversified product
portfolio, and healthy financial risk profile marked by adequate debt
protection metrics. These rating strengths are partially offset by Varroc
group's exposure to risks related to high customer concentration in revenue
profile.
Analytical
Approach
For arriving at its ratings, CRISIL has combined the
business and financial risk profiles of Durovalves, Varroc Engineering Private
Limited (VEPL), Varroc Exhaust Systems Private Limited (VESPL), Varroc Polymers
Private Limited (VPPL) and Varroc Elastomers Private Limited (VELPL);
collectively referred as Varroc group, as all the companies are in the same
line of business and are owned by the same promoter. The financials of VEPL's
overseas subsidiary Varroc European Holding BV, Netherlands (VEHBV), and its
step-down subsidiary, IMES Italy, collectively referred to as IMES group, have
not been consolidated. This is because of the Varroc group management's
demonstrated action of letting IMES group go into debt restructuring; Varroc
group is not expected to infuse any additional funds in the IMES group. CRISIL
has deducted the value of investments made in the IMES group, at Rs.1.3 billion,
from the net worth of the Varroc group.
Outlook:
Stable
CRISIL believes that the Varroc group will maintain its
market position in the auto component business over the medium term, driven by
the strong growth prospects in its end-user industry and its established
relationship with BAL. The outlook may be revised to 'Positive' if the group
diversifies its customer profile or is able to generate higher-than-expected
cash accruals thereby resulting in a significant improvement in capital
structure. Conversely, the outlook may be revised to 'Negative' if the Varroc
group provides additional funding support to the IMES group, or if there is a
substantial decline in the operating margin or working capital requirements are
larger than expected, thereby deteriorating its financial risk profile.
About
the Group
The Varroc group commenced operations in 1988 with the
manufacture of plastic-injection-moulded components for supply to BAL in
Aurangabad (Maharashtra). The group has since diversified its product portfolio;
it now offers a variety of electrical, polymer-based engineering assemblies and
sub-assemblies. The group comprises five companies operating in India,
organised under two divisions - VEPL and its subsidiaries, VESPL, and
Durovalves, which are in the electrical and metallic components business; and
VPPL and its subsidiary, VELPL, which manufacture polymer-based components. The
group operates 18 plants in five locations across India.
In 2006-07, the group set up VEHBV, a special purpose
vehicle, which acquired a majority stake in the IMES group, which had two
plants in Europe, one each in Italy and Poland. The IMES group closed its plant
in Poland in 2009-10 and is in advanced stage of negotiations with buyers to
sell off the land for around Rs.600 million. Varroc group has written down the
investments of Rs.1.3 billion made in IMES group in 2009-10. Promoted by the
Jain family, the Varroc group is managed by Mr. Tarang Jain.
Varroc group reported net sales of Rs.15.0 billion for
2009-10, against net sales of Rs.11.6 billion for 2008-09.
------------------------------------------------------------------------------------------------------------------------------
Varroc
Engineering's loans get higher rating by CRISIL.
Equity Bites: 20 January 2011
[What follows is the full text of the news story.]
20 January 2011 - Indian rating agency CRISIL today upgraded the rating on two loans of Varroc Engineering Pvt Ltd to BBB+ from BBB-.
The agency issued the following press release:
Rs.1544.7 Million Long-Term Loan BBB+/Stable (Upgraded from ' BBB-/Stable')
Rs.727.5 Million Cash Credit BBB+/Stable (Upgraded from ' BBB-/Stable')
Rs.700.0 Million Purchase Bill Discounting P2 (Upgraded from 'P3')
Rs.1000.0 Million Letter of Credit P2 (Upgraded from 'P3')
Rs.320.0 Million Bank Guarantee P2 (Upgraded from 'P3')
CRISIL has upgraded its rating on the long-term bank facilities of Varroc Engineering Private Limited (VEPL, part of the Varroc group), to 'BBB+/Stable/P2' from 'BBB-/Stable/P3'.
The upgrade in rating is driven by an expectation of strong
revenue growth for the Varroc group, which, coupled with a stable operating
margin, will result in an improvement in the group's net worth and capital
structure. The group's revenues registered growth of 50 per cent in the first
half of 2010-11 (refers to April 1 to September 30) over the first half of
2009-10; its operating margin was stable, at 13 per cent. The growth in
revenues is driven by the healthy growth in the two-wheeler industry and
increase in Bajaj Auto Limited (BAL; rated 'AAA/Stable/P1+' by CRISIL) market
share; BAL accounts for around 70 to 75 per cent of the group's revenues. The
revenues of the group are expected to register growth of 40 to 45 per cent in
2010-11 (refers to financial year, April 1 to March 31). This, coupled with a
stable operating margin, is expected to result in high net profits. As a
result, the net worth of the group is expected to increase to around Rs.4.1
billion, as on March 31, 2011, from Rs.2.8 billion, as on March 31, 2010. The
growth in net worth, coupled with moderate capital expenditure plan, is
expected to result in an improvement in gearing to 1.0 time as on March 31,
2011 from 1.3 times as on March 31, 2010.
The ratings reflect the Varroc group's established track
record in the automotive (auto) components business, diversified product
portfolio, and healthy financial risk profile marked by adequate debt
protection metrics. These rating strengths are partially offset by Varroc
group's exposure to risks related to high customer concentration in revenue
profile.
Analytical
Approach
For arriving at its ratings, CRISIL has combined the
business and financial risk profiles of VEPL, Varroc Exhaust Systems Private
Limited (VESPL), Durovalves (India) Private Limited (Durovalves), Varroc
Polymers Private Limited (VPPL) and Varroc Elastomers Private Limited (VELPL);
collectively referred as Varroc group, as all the companies are in the same
line of business and are owned by the same promoter. The financials of VEPL's
overseas subsidiary Varroc European Holding BV, Netherlands (VEHBV), and its
step-down subsidiary, IMES Italy, collectively referred to as IMES group, have
not been consolidated. This is because of the Varroc group management's
demonstrated action of letting IMES group go into debt restructuring; Varroc
group is not expected to infuse any additional funds in the IMES group. CRISIL
has deducted the value of investments made in the IMES group, at Rs.1.3
billion, from the net worth of the Varroc group.
Outlook:
Stable
CRISIL believes that the Varroc group will maintain its
market position in the auto component business over the medium term, driven by
the strong growth prospects in its end-user industry and its established
relationship with BAL. The outlook may be revised to 'Positive' if the group
diversifies its customer profile or is able to generate higher-than-expected
cash accruals thereby resulting in a significant improvement in capital
structure. Conversely, the outlook may be revised to 'Negative' if the Varroc
group provides additional funding support to the IMES group, or if there is a
substantial decline in the operating margin or working capital requirements are
larger than expected, thereby deteriorating its financial risk profile.
About
the Group
The Varroc group commenced operations in 1988 with the
manufacture of plastic-injection-moulded components for supply to BAL in
Aurangabad (Maharashtra). The group has since diversified its product
portfolio; it now offers a variety of electrical, polymer-based engineering
assemblies and sub-assemblies. The group comprises five companies operating in
India, organised under two divisions - VEPL and its subsidiaries, VESPL, and
Durovalves, which are in the electrical and metallic components business; and
VPPL and its subsidiary, VELPL, which manufacture polymer-based components. The
group operates 18 plants in five locations across India.
In 2006-07, the group set up VEHBV, a special purpose vehicle,
which acquired a majority stake in the IMES group, which had two plants in
Europe, one each in Italy and Poland. The IMES group closed its plant in Poland
in 2009-10 and is in advanced stage of negotiations with buyers to sell off the
land for around Rs.600 million. Varroc group has written down the investments
of Rs.1.3 billion made in IMES group in 2009-10. Promoted by the Jain family,
the Varroc group is managed by Mr. Tarang Jain.
Varroc group reported net sales of Rs.15.0 billion for
2009-10, against net sales of Rs.11.6 billion for 2008-09.
------------------------------------------------------------------------------------------------------------------------------
CRISIL upgrades
Varroc Exhaust Systems bank facilities
Aii Data Processing Ltd: 20 January 2011
[What follows is
the full text of the news story.]
(ADP news) - Jan 20, 2011 - Indian rating agency CRISIL today raised the
rating on bank facilities of Varroc Exhaust Systems Private Limited to
BBB+/"stable" from BBB-/"stable".
The agency issued the following press release:
Rs.50 Million Cash Credit BBB+/Stable (Upgraded from 'BBB-/Stable')
Rs.62.7 Million Proposed Long Term Bank Loan Facility BBB+/Stable
(Upgraded from 'BBB-/Stable')
CRISIL has upgraded its rating on the long-term bank facilities of
Varroc Exhaust Systems Private Limited (VESPL, part of the Varroc group), to
BBB+/Stable from BBB-/Stable.
The upgrade in rating is driven by an expectation of strong revenue
growth for the Varroc group, which, coupled with a stable operating margin,
will result in an improvement in the group net worth and capital structure. The
group revenues registered growth of 50 per cent in the first half of 2010-11
(refers to April 1 to September 30) over the first half of 2009-10; its
operating margin was stable, at 13 percent. The growth in revenues is driven by
the healthy growth in the two-wheeler industry and increase in Bajaj Auto
Limited (BAL; rated AAA/Stable/P1+ by CRISIL) market share; BAL accounts for
around 70 to 75 per cent of the group revenues. The revenues of the group are
expected to register growth of 40 to 45 per cent in 2010-11 (refers to
financial year, April 1 to March 31). This, coupled with a stable operating
margin, is expected to result in high net profits. As a result, the net worth
of the group is expected to increase to around Rs.4.1 billion, as on March 31,
2011, from Rs.2.8 billion, as on March 31, 2010. The growth in net worth,
coupled with moderate capital expenditure plan, is expected to result in an
improvement in gearing to 1.0 time as on March 31, 2011 from 1.3 times as on
March 31, 2010.
The ratings reflect the Varroc group established track record in the
automotive (auto) components business, diversified product portfolio, and
healthy financial risk profile marked by adequate debt protection metrics.
These rating strengths are partially offset by Varroc group exposure to risks
related to high customer concentration in revenue profile.
Analytical
Approach
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of VESPL, Varroc Engineering Private Limited (VEPL),
Durovalves (India) Private Limited (Durovalves), Varroc Polymers Private
Limited (VPPL) and Varroc Elastomers Private Limited (VELPL); collectively
referred as Varroc group, as all the companies are in the same line of business
and are owned by the same promoter. The financials of VEPL overseas subsidiary
Varroc European Holding BV, Netherlands (VEHBV), and its step-down subsidiary,
IMES Italy, collectively referred to as IMES group, have not been consolidated.
This is because of the Varroc group management demonstrated action of letting
IMES group go into debt restructuring; Varroc group is not expected to infuse
any additional funds in the IMES group. CRISIL has deducted the value of
investments made in the IMES group, at Rs.1.3 billion, from the net worth of
the Varroc group.
Outlook: Stable
CRISIL believes that the Varroc group will maintain its market position in
the auto component business over the medium term, driven by the strong growth
prospects in its end-user industry and its established relationship with BAL.
The outlook may be revised to Positive if the group diversifies its customer
profile or is able to generate higher-than-expected cash accruals thereby
resulting in a significant improvement in capital structure. Conversely, the
outlook may be revised to Negative if the Varroc group provides additional
funding support to the IMES group, or if there is a substantial decline in the
operating margin or working capital requirements are larger than expected,
thereby deteriorating its financial risk profile.
About the Group
The Varroc group commenced operations in 1988 with the manufacture of
plastic-injection-moulded components for supply to BAL in Aurangabad
(Maharashtra). The group has since diversified its product portfolio; it now
offers a variety of electrical, polymer-based engineering assemblies and
sub-assemblies. The group comprises five companies operating in India,
organised under two divisions - VEPL and its subsidiaries, VESPL, and
Durovalves, which are in the electrical and metallic components business; and
VPPL and its subsidiary, VELPL, which manufacture polymer-based components. The
group operates 18 plants in five locations across India.
In 2006-07, the group set up VEHBV, a special purpose vehicle, which
acquired a majority stake in the IMES group, which had two plants in Europe,
one each in Italy and Poland. The IMES group closed its plant in Poland in
2009-10 and is in advanced stage of negotiations with buyers to sell off the
land for around Rs.600 million. Varroc group has written down the investments
of Rs.1.3 billion made in IMES group in 2009-10. Promoted by the Jain family,
the Varroc group is managed by Mr. Tarang Jain.
Varroc group reported net sales of Rs.15.0 billion for 2009-10, against
net sales of Rs.11.6 billion for 2008-09.
(INR 100 = USD 2.194/EUR 1.628)
------------------------------------------------------------------------------------------------------------------------------
CRISIL hikes
ratings on Varroc Polymers bank facilities
Aii Data Processing Ltd: 20 January 2011
[What follows is
the full text of the news story.]
(ADP news) - Jan 20, 2011 - Indian rating agency CRISIL today upgraded
the ratings on three loans and a purchase-discounting facility of Varroc
Polymers Private Limited to
BBB+/"stable" from BBB-/"stable".
The agency issued the following press release:
Rs.329 Million Long Term Loan BBB+/Stable (Upgraded from ' BBB-/Stable')
Rs.500 Million Cash Credit BBB+/Stable (Upgraded from ' BBB-/Stable')
Rs.50 Million Cash Credit * BBB+/Stable (Upgraded from ' BBB-/Stable')
Rs.400 Million Bill Purchase-Discounting Facility BBB+/Stable (Upgraded from
' BBB-/Stable’)
Rs.40 Million Bank Guarantee P2 (Upgraded from P3)
Rs.50 Million Letter of Credit P2 (Upgraded from P3)
Rs.500 Million Letter of Credit # P2 (Upgraded from P3)
* Interchangeable with ULC/SLC/BG/BC/WCDL
# Fully Interchangeable with Buyers Credit
CRISIL has upgraded its rating on the long-term bank facilities of
Varroc Polymers Private Limited (VPPL, part of the Varroc group), to
BBB+/Stable/P2 from BBB-/Stable/P3.
The upgrade in rating is driven by an expectation of strong revenue
growth for the Varroc group, which, coupled with a stable operating margin,
will result in an improvement in the group’s net worth and capital structure.
The groups revenues registered growth of 50 per cent in the first half of
2010-11 (refers to April 1 to September 30) over the first half of 2009-10; its
operating margin was stable, at 13 per cent. The growth in revenues is driven
by the healthy growth in the two-wheeler industry and increase in Bajaj Auto
Limited (BAL; rated AAA/Stable/P1+ by CRISIL) market share; BAL accounts for
around 70 to 75 per cent of the groups revenues. The revenues of the group are
expected to register growth of 40 to 45 per cent in 2010-11 (refers to
financial year, April 1 to March 31). This, coupled with a stable operating margin,
is expected to result in high net profits. As a result, the net worth of the
group is expected to increase to around Rs.4.1 billion, as on March 31, 2011,
from Rs.2.8 billion, as on March 31, 2010. The growth in net worth, coupled
with moderate capital expenditure plan, is expected to result in an improvement
in gearing to 1.0 time as on March 31, 2011 from 1.3 times as on March 31,
2010.
The ratings reflect the Varroc groups established track record in the
automotive (auto) components business, diversified product portfolio, and
healthy financial risk profile marked by adequate debt protection metrics.
These rating strengths are partially offset by Varroc groups exposure to risks
related to high customer concentration in revenue profile.
Analytical
Approach
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of VPPL, Varroc Engineering Private Limited (VEPL),
Varroc Exhaust Systems Private Limited (VESPL), Durovalves (India) Private
Limited (Durovalves), and Varroc Elastomers Private Limited (VELPL);
collectively referred as Varroc group, as all the companies are in the same
line of business and are owned by the same promoter. The financials of VEPLs
overseas subsidiary Varroc European Holding BV, Netherlands (VEHBV), and its
step-down subsidiary, IMES Italy, collectively referred to as IMES group, have
not been consolidated. This is because of the Varroc group managements
demonstrated action of letting IMES group go into debt restructuring; Varroc
group is not expected to infuse any additional funds in the IMES group. CRISIL
has deducted the value of investments made in the IMES group, at Rs.1.3
billion, from the net worth of the Varroc group.
Outlook: Stable
CRISIL believes that the Varroc group will maintain its market position
in the auto component business over the medium term, driven by the strong
growth prospects in its end-user industry and its established relationship with
BAL. The outlook may be revised to Positive if the group diversifies its
customer profile or is able to generate higher-than-expected cash accruals
thereby resulting in a significant improvement in capital structure.
Conversely, the outlook may be revised to Negative if the Varroc group provides
additional funding support to the IMES group, or if there is a substantial
decline in the operating margin or working capital requirements are larger than
expected, thereby deteriorating its financial risk profile.
About the Group
The Varroc group commenced operations in 1988 with the manufacture of
plastic-injection-moulded components for supply to BAL in Aurangabad
(Maharashtra). The group has since diversified its product portfolio; it now
offers a variety of electrical, polymer-based engineering assemblies and
sub-assemblies. The group comprises five companies operating in India,
organised under two divisions - VEPL and its subsidiaries, VESPL, and
Durovalves, which are in the electrical and metallic components business; and
VPPL and its subsidiary, VELPL, which manufacture polymer-based components. The
group operates 18 plants in five locations across India.
In 2006-07, the group set up VEHBV, a special purpose vehicle, which
acquired a majority stake in the IMES group, which had two plants in Europe,
one each in Italy and Poland. The IMES group closed its plant in Poland in
2009-10 and is in advanced stage of negotiations with buyers to sell off the
land for around Rs.600 million. Varroc group has written down the investments of
Rs.1.3 billion made in IMES group in 2009-10. Promoted by the Jain family, the
Varroc group is managed by Mr. Tarang Jain.
Varroc group reported net sales of Rs.15.0 billion for 2009-10, against
net sales of Rs.11.6 billion for 2008-09.
(INR 100 = USD 2.194/EUR 1.628)
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.44.38 |
|
|
1 |
Rs.72.34 |
|
Euro |
1 |
Rs.63.87 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
6 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
6 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
6 |
|
--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 |
NO |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
59 |
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.