MIRA INFORM REPORT

Report Date :

08.06.2011

Note: Correct name of the company is Insulators and Electricals Company (Division of Hindusthan Vidyut Products Limited)

IDENTIFICATION DETAILS

Name :	HINDUSTHAN VIDYUT PRODUCTS LIMITED INSULATORS AND ELECTRICALS COMPANY (DIVISION OF HINDUSTHAN VIDYUT PRODUCTS LIMITED)

Registered Office :	Kanchenjunga Seventh Floor, 18, Barakhamba Road, New Delhi-110001

Country :	India

Financials (as on) :	31.03.2010

Date of Incorporation :	17.10.1959

Com. Reg. No.:	55-003141

Capital Investment / Paid-up Capital :	Rs.14.430 Millions

CIN No.: [Company Identification No.]	L31300DL1959PLC003141

IEC No.:	0588001236

Tin No.:	23684000405

PAN No.: [Permanent Account No.]	AAACT2345J

Legal Form :	Public Limited Liability Company. The company’s shares are listed on the Stock Exchanges.

Line of Business :	Manufacturer, Exporter, Trader and Importer of Overhead Conductors, Electric Cables and Insulators.

No. of Employees :	1200 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

A (67)

RATING

STATUS

PROPOSED CREDIT LINE

56-70

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

Fairly Large

Maximum Credit Limit :	USD 8600000

Status :	Good

Payment Behaviour :	Regular

Litigation :	Clear

Comments :	Subject is a well established and reputed company having fine track. Financial position of the company appears to be sound. Trade relations are reported as fair. Business is active. Payments are reported to be regular and as per commitments. The company can be considered good for normal 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)

India

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

INFORMATION PARTED BY

Name :	Mr. Gorav Khandalwal
Designation :	Accountant
Contact No.:	91-7480-407900
Date :	01.06.2011

LOCATIONS

Registered Office/ Factory :	Kanchenjunga Seventh Floor, 18, Barakhamba Road, New Delhi-110001, India
Tel. No.:	91-7480-407900/901/902/903/904/905/11-23310001
Mobile No.:	91-7480-407900 (Mr. Gorav Khandalwal)
Fax No.:	91-7480-233329/407908/11-23313707
E-Mail :	sales@iec_insulators.com hvplndl@hindusthanvidyut.com
Website :	www.insulatorsindia.com
Area :	Owned

Branch Office:	1-8, New Industrial Area, P B No. 1, Mandideep-462046, Madhya Pradesh, India

Branches :	Also Located At: Chennai Mumbai Faridabad Gwalior Guwahati

DIRECTORS

As on 17.07.2010

Name :	Mr. Rajendra Prasad Mody
Designation :	Director
Address :	14 B, Judges Court Road, Kolkata-700027, West Bengal, India
Date of Birth/Age :	18.06.1937
Date of Appointment :	31.03.1973
Din No.:	00140503

Name :	Mr. Vikram Aditya Mody
Designation :	Director
Address :	14 B, Judges Court Road, Kolkata-700027, West Bengal, India
Date of Birth/Age :	16.11.1961
Date of Appointment :	02.04.2003
Din No.:	00193192

Name :	Mr. Om Prakash Shroff
Designation :	Director
Address :	705 Nilgiri Apartment, 9 Barakhamba Raod, New Delhi-110001, India
Date of Birth/Age :	05.10.1940
Date of Appointment :	28.07.2002
Din No.:	00286927

Name :	Suman Jyoti Khaitan
Designation :	Director
Address :	W-13, Greater Kailash, Part II, New Delhi-110048, India
Date of Birth/Age :	09.02.1959
Date of Appointment :	30.10.2002
Din No.:	00023370

Name :	Mr. Rajesh Tripathi
Designation :	Director
Address :	N-108, South Avenue, South Avenue, Sanik Farms, New Delhi-110062, India
Date of Birth/Age :	31.08.1952
Date of Appointment :	30.01.2002
Din No.:	00441738

Name :	Mr. Subhash Madan
Designation :	Director
Address :	BF-37, Tagore Garden, New Delhi-110027, NCT of Delhi, India
Date of Birth/Age :	02.09.1942
Date of Appointment :	26.07.2002
Din No.:	00166052

Name :	Mr. Shyam Sunder Bhuwania
Designation :	Director
Address :	S-247, Greater Kailash, Part II, New Delhi-110048, India
Date of Birth/Age :	06.04.1944
Date of Appointment :	04.02.1975
Din No.:	00107171

KEY EXECUTIVES

Name :	Mr. Murari Lal Biamiwala
Designation :	Secretary
Address :	1-10491A, Mohan, Mohan Park, New Delhi-110032, India
Date of Birth/Age :	07.05.1950
Date of Appointment :	07.08.1982

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 17.07.2010

Names of Shareholders		No. of Shares
Maharani Gita Devi of Kapurthala		4200
Nutan Prashant Parekh		1100
Hindusthan Consultancy and Services Limited , India		708825
Arundhati Balkrishna		2120
Hindusthan Business Corporation Limited , India		47000
Pradyumnna Steels Limited , India		70000
Dolly Behram Aryana		12320
Suresh Amritlal Kotak		2470
Dharmishta Jayesh Barot		2000
Nita M Patel		30000
Sanjay Kumar Loiwal		10656
Mahendra Girdharilal		16460
Lata Bhanshali		4300
The Oriental Insurance Company Limited, India		5000
Capital Services Limited, India		25945
Pinakin Chimanlal Shah		20000
Nirmala Bhuwania		2050
Bhagubhai Madhav Patel		17000
Promain Limited, India		137900
Carbo Industrial Holdings Limited, India		132820

BUSINESS DETAILS

Line of Business :

Manufacturer, Exporter, Trader and Importer of Overhead Conductors, Electric Cables and Insulators.

Products :

Product Description	Item Code
Electrical Conductors	854460
Insulated Electrical Wires, Cables	854419
Porcelain Bushings Above 22 KV	854710.40

Terms :

Selling :

Cash and Credit

Purchasing :

Cash and Credit

PRODUCTION STATUS (AS ON 31.03.2010)

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
Electrical Cables, Wires	MT	15000	70200	19282
Conductors, Strips, High Tension	Kms.	3150	2700	--
Insulators	MT	16400	15379	10082

GENERAL INFORMATION

Customers :

Asea Brown Boveri Limited (ABB)
Alstom Limited, USA
BHEL
Crompton Greaves Limited
ELPRO Limited
ENEL, Italy
Indian Railways
Passoni and Villa SpA, Italy
Schneider Electric, Italy
Power Grid Corporation
SIEMENS (India) Limited
Electrical Kerala Limited (TELK)
Areva T and D India Limited

No. of Employees :

1200 (Approximately)

Bankers :

Canara Bank, 74, Janpath, New Delhi-110001, India
State Bank of India, Commercial Branch, Hoshangabad Road, Bhopal-462011, Madhya Pradesh, India
Dena Bank, M-36, Connaught Circus, New Delhi, India

Facilities :

Secured Loan	As on 31.03.2010 (Rs. in Millions)	As on 31.03.2009 (Rs. in Millions)
Term Loan from a bank	850.441	690.789
Working capital facilities from banks	326.436	300.931
Total	1176.877	991.720

Unsecured Loan
Others	27.134	30.397
Total	27.134	30.397

Note:

(i) Term loan of Rs.610.539 millions from a bank is secured by way first charge on the Fixed Assets financed out of Term Loan including existing land of Insulator Division. Falling due within one year Rs.138.900 millions (Previous year Rs.74.500 millions) and Term loan of Rs.239.901 millions from a bank is secured by first charge on the Assets created out of the 4 No. Wind Turbine Generator at Rajasthan, charge of the land at WTG site is yet to be created. Falling due within one year Rs.8.036 millions (Previous Year Rs. Nil)

(ii) Working Capital Facilities from a Bank for the Cable and Conductor Division are secured against hypothecation of stocks, book debts, equitable mortagage of land and building and hypothecation of plant and machinery, both present and future, at Faridabad and Gwalior. Working Capital Facilities from a Bank for the Insulator Division are Secured against hypothecation of stocks and book debts of Insulator Division and second charge on Fixed Assets of that Division against which drawing is Rs.326.436 (Previous year Rs.300.931 millions.)

(iii) Unsecured Loan from others represent interest free loan against Sales Tax deferment Scheme, Falling due within one year Rs. NIL (Previous Year Rs. NIL).


Banking Relations :	--

Auditors :
Name :	Singhi and Company Chartered Accountant
Address :	401-408, Pragati House, 47-48, Nehru Place, New Delhi-110019, India

CAPITAL STRUCTURE

As on 31.03.2010

Authorised Capital :

No. of Shares	Type	Value	Amount
2500000	Equity Shares	Rs.10/- each	Rs.25.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
1443000	Equity Shares	Rs.10/- each	Rs.14.430 Millions

Note:

Out of the above 10,000 Equity Shares have been allotted as fully paid up pursuant to a contract without payment having been received in cash and 4,00,000 Equity Shares have been allotted as fully paid up by way of Bonus Shares by Capitalisation of reserves. 2,00,000 Equity Shares have been allotted to erstwhile Shareholders of Gwalior Cables and Conductors Limited as fully paid up pursuant to a Scheme of Amalgamation.

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2010	31.03.2009
SHAREHOLDERS FUNDS
1] Share Capital		14.429	14.429
2] Share Application Money		0.000	0.000
3] Reserves & Surplus		2155.677	1907.284
4] (Accumulated Losses)		0.000	0.000
NETWORTH		2170.106	1921.713
LOAN FUNDS
1] Secured Loans		1176.877	991.720
2] Unsecured Loans		27.134	30.397
TOTAL BORROWING		1204.011	1022.117
DEFERRED TAX LIABILITIES		170.884	120.468

TOTAL		3545.001	3064.298

APPLICATION OF FUNDS

FIXED ASSETS [Net Block]		1462.953	1349.401
Capital work-in-progress		235.177	4.226

INVESTMENT		19.344	19.343
DEFERREX TAX ASSETS		0.000	0.000

CURRENT ASSETS, LOANS & ADVANCES
	Inventories	886.938	564.478
	Sundry Debtors	988.308	914.031
	Cash & Bank Balances	512.089	648.851
	Other Current Assets	26.772	28.421
	Loans & Advances	472.056	376.321
Total Current Assets		2886.163	2532.102
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	810.585	363.624
	Other Current Liabilities	161.906	418.359
	Provisions	86.145	58.791
Total Current Liabilities		1058.636	840.774
Net Current Assets		1827.527	1691.328

MISCELLANEOUS EXPENSES		0.000	0.000

TOTAL		3545.001	3064.298

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009
	SALES
		Income	5008.117	2860.938
		Other Income	146.571	105.940
		TOTAL (A)	5154.688	2966.878

Less	EXPENSES
		Manufacturing and Other Expenses	4523.421	2564.737
		TOTAL (B)	4523.421	2564.737

Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		631.267	402.141

Less	FINANCIAL EXPENSES (D)		168.716	130.611

	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		462.551	271.530

Less/ Add	DEPRECIATION/ AMORTISATION (F)		88.877	76.852

	PROFIT BEFORE TAX (E-F) (G)		373.674	194.678

Less	TAX (H)		121.904	71.740

	PROFIT AFTER TAX (G-H) (I)		251.770	122.938

Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		8.770	8.210

Less	APPROPRIATIONS
		Transfer to General Reserve	248.015	119.002
		Proposed Dividend	2.886	2.886
		Tax on Dividend	0.490	0.490
	BALANCE CARRIED TO THE B/S		9.149	8.770

	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	175.205	382.757
		Freight and Insurance on Export	2.270	13.065
		Earning by Sale under Global Tender in India	227.829	62.297
		Interest Received	0.371	0.000
	TOTAL EARNINGS		405.675	458.119

	IMPORTS
		Raw Materials	729.476	325.784
		Stores & Spares	9.965	14.448
		Capital Goods	19.013	1.311
	TOTAL IMPORTS		758.454	341.543

	Earnings Per Share (Rs.)		174.49	85.20

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009
PAT / Total Income	(%)	4.88	4.14

Net Profit Margin (PBT/Sales)	(%)	7.46	6.80

Return on Total Assets (PBT/Total Assets}	(%)	8.59	5.02

Return on Investment (ROI) (PBT/Networth)		0.17	0.10

Debt Equity Ratio (Total Liability/Networth)		1.04	0.97

Current Ratio (Current Asset/Current Liability)		2.73	3.01

LOCAL AGENCY FURTHER INFORMATION

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

INDUSTRY STRUCTURE AND DEVELOPMENTS

India has the third largest Transmission and Distribution network in the world. With the Government of India planning to attain installed generation capacity of at least 2,00,000 M.W by 2012 as against 1,57,230 M.W. as on 28.02.2010, a massive expansion in the transmission network will be required. As against capacity addition target of 78,700 MW during 11th five year plan, 21,211 MW capacity addition has been achieved by 31.03.2010. It is hoped that there will be acceleration in the capacity addition programme in the remaining two years. All these developments will create additional demand for our products.

OPPORTUNITIES

Massive expansion of power generating capacity of Power Sector, rural electrification and faster implementation of ultra mega power projects by Government will lead to increased opportunities for the products of your Company. Increased acceptance of Polymer Composite Insulators in place of Ceramic Insulators by SEB’s, Powergrid and Railways is a potential threat to Insulator division. Competition from Chinese manufacturers is an additional threat to Insulator Division.

FUTURE OUTLOOK

The demand for products of your Company is likely to increase in view of massive expansion undertaken by the Government in transmission network. Sustained service level to our existing customers is being maintained to get repeat orders. Insulators with 245 K.V, 400 K.V. and 765 K.V. for circuit Breakers have been developed in order to have additional business from Circuit Breaker manufacturers.

CONTINGENT LIABILITIES NOT PROVIDED FOR:

Particular	As on 31.03.2010 (Rs. in Millions)	As on 31.03.2009 (Rs. in Millions)
Income Tax deemed under appeal	0.117	0.000
Outstanding Bank Guarantees (Net of Margin Money)	1776.860	1669.374
Guarantees/Securities given on behalf of third parties	13.073	13.073
Excise Duty show cause notices/demands under appeal	42.935	6.183
Claims against the Company for Sales Tax etc .under litigation	51.963	46.309
Surety Bond given to Custom and Excise/JDFT	552.069	529.779
Total	2437.017	2264.718

BANKERS CHARGES REPORT AS PER REGISTRY

This form is for	Modification of charge
Charge identification number of the modified	80003631
Corporate identity number of the company	L31300DL1959PLC003141
Name of the company	HINDUSTHAN VIDYUT PRODUCTS LIMITED
Address of the registered office or of the principal place of business in India of the company	Kanchenjunga Seventh Floor, 18, Barakhamba Road, New Delhi-110001, India
Type of charge	Book Debts Others
Particular of charge holder	State Bank of India, Commercial Branch, Hoshangabad Road, Bhopal-462011, Madhya Pradesh, India
Email	sbi.01920@sbi.co.in
Nature of description of the instrument creating or modifying the charge	Form C-5 letter regarding the grant of individual limits within the overall limit dated 04.11.2010
Date of instrument Creating the charge	04.11.2010
Amount secured by the charge	Rs.665.500 Millions
Brief particulars of the principal terms an conditions and extent and operation of the charge	Rate of Interest For cash credit base rate +4%i.e. 11.60% p.a. with monthly rests and as per RBI bank rules Terms of Repayment Payable on demand Margin Raw material (imported) 25%, raw material (indigenous) 25%, stock in process 35%, finished goods 30%, book debts (cover period 90 days), 40% LC (cash marging) 5% bank guarantee (cash margin)5%. Extent and Operation of the charge Hypothecation of the entire stock of raw material, finished goods, stock in process, consumable, stores and spares, packing material, book-debts, outstanding monies, receivables, claims and bills etc. relation to Insulators unit at Mandideep, District Raisen (Madhya Pradesh) Others 1) Stock statement to be submitted in monthly intervals. 2) No drawings will be permitted against unpaid stocks procured under letter of credit.
Short particulars of the property charged	I) Hypothecation of the stock of the stocks of raw materials, stores, stock in process and finished goods, presents and future including documents of title to the goods and other assets, such as book debts. II) Outstanding moneys, receivable including receivables by way of cash assistance and / or cash incentives under cash incentives scheme, guarantees, engagements. III) And rights of the company unit insulators and Electrical Company at Mandideep, District Raisen (Madhya Pradesh)
Date of latest modification prior to the present modification	06.01.2010
Particulars of the present modification	The amount secured by charge in favour of State Bank of India, Bhopal being renewed and enhanced from Rs.512.500 millions to Rs.665.500 millions vide from C-5 dated 04.11.2010.

FIXED ASSETS:

Freehold Land
Leasehold Land
Buildings
Plant and Machinery
Furniture and Fixtures
Vehicles
Software Licence

CMT REPORT (Corruption, Money Laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No 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.44.74
UK Pound	1	Rs.73.25
Euro	1	Rs.65.48

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	8
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	8
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	7
--LIQUIDITY	1~10	8
--LEVERAGE	1~10	7
--RESERVES	1~10	8
--CREDIT LINES	1~10	7
--MARGINS	-5~5	-
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	NO
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		67

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	-

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.

MIRA INFORM REPORT

886.938

988.308

512.089

26.772

472.056

2886.163

810.585

161.906

86.145

1058.636

1827.527

Unit