MIRA INFORM REPORT

 

 

Report Date :

28.06.2011

 

IDENTIFICATION DETAILS

 

Name :

ELECON ENGINEERING COMPANY LIMITED

 

 

Registered Office :

Anand, Sujitra Road, Vallabh Vidyanagar – 388 120, Gujarat

 

 

Country :

India

 

 

Financials (as on) :

31.03.2010

 

 

Date of Incorporation :

11.01.1960

 

 

Com. Reg. No.:

04-001082

 

 

Capital Investment / Paid-up Capital :

Rs.185.723 millions

 

 

CIN No.:

[Company Identification No.]

L29259GJ1960PLC001082

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

BRDE00200E

 

 

PAN No.:

[Permanent Account No.]

AAACE4644D

 

 

Legal Form :

A Public Limited Liability Company.  The Company’s Shares are Listed on the Stock Exchanges.

 

 

Line of Business :

Manufacturer and Supplier of Material Handling Equipments and Reduction Gears.

 

 

No. of Employees :

2000 (Approximately)

 

 

RATING & COMMENTS

 

MIRA’s Rating :

A (66)

 

RATING

STATUS

 

PROPOSED CREDIT LINE

56-70

A

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

Fairly Large

 

Maximum Credit Limit :

USD 13044000

 

 

Status :

Good

 

 

Payment Behaviour :

Regular 

 

 

Litigation :

Clear

 

 

Comments :

Subject is a well established and reputed company having fine track. Financial positions of the company appears to be sound. However trade relations are reported as fair. Business is active. Payments are reported to be regular and as per commitments.

 

The company can be considered normal for business dealings at usual trade terms and conditions.

 

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

 

 

ECGC Country Risk Classification List – April 1, 2010

 

Country Name

Previous Rating

(31.12.2009)

Current Rating

(01.04.2010)

India

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

 

INFORMATION PARTED BY (General Details)

 

Name :

Mr. Chirag Darji

Designation :

Deputy Manager Accounts

Contact No.:

91-9909917052

Date :

22.06.2011

 

 

LOCATIONS

 

Registered Office :

Anand, Sujitra Road, Vallabh Vidyanagar – 388 120, Gujarat, India

Tel. No.:

91-2692-236469/ 236513/ 236516/ 236520/ 227113/ 227080/ 237016/ 236521/ 236590/ 227491/ 227960/ 230017

Mobile No.:

91-9909917052 (Mr. Chirag)

Fax No.:

91-2692-236527/ 236457/ 227020

E-Mail :

pmshukla@mhe.elecon.com

Website :

http://www.elecon.co.in

http://www.elecon.com

Area :

25000 Sq. Fts

Location :

Owned

 

 

Overseas Offices :

Elecon Singapore Pte. Limited

10 Anson Road, #19-13 International Plaza, Singapore – 079903.
Phone : +65-62278258/ 62278425

Fax     : +65-62278942

Contact: Mr. Keyur Parikh

E-mail: keyur@eleconsingapore.elecon.com

Mr. Vipul Shah

E-mail: v_shah@eleconsingapore.elecon.com

 

Elecon Australia Pty. Limited

6/398 The Boulevarde, P. O. Box 3065, Kirrawee DC, NSW 2232, Australia.

Tel: 2 9542 2955 (National)

      +61 2 9542 2955 (International)

Fax: +61 2 9542 2677

Contact: Mr. Terry Hall

E-mail: thall@aus.elecon.com

 

Elecon Africa Pty. Limited

P. O. Box 202, Florida Hills 1716, South Africa

Cell : +27 82900 6829

Telefax: +27 11 4771776

Contact: Mr. Graeme Ramsay

E-mail: gdramsay@mweb.co.za

Contact: Mr. J. N. Shah

E-mail: jnshah@gear.elecon.com

 

ELECON MIDDLE EAST FZCO

PO Box: - 54754, Dubai, UAE

Fax: +971 4 3510461

Phone: + 971 4 3510251 / 3510547

Contact: Mr. Pratap Bhugra: pratap@eleconmeelecon.com

              Mr. Rajen Kavani:  rajen@eleconme.elecon.com

 

 

 

 

Factory  :

Material Handling Division (MHE-Division)

Anand-Sojitra Road, Vallabh Vidyanagar-388120, Gujarat, India

 

Gear Division

Anand-Sojitra Road, Vallabh Vidyanagar- 388120, Gujarat, India

 

Wind Mill Division

Anand-Sojitra Road, Vallabh Vidyanagar- 388120, Gujarat, India

 

 

Branch Office :

Located at :

 

·         Kolkata

·         Burdwan

·         Dhanbad

·         Jamshedpur

·         Ahmedabad

·         Mumbai

·         Pune

·         Vallabh Vidyanagar

·         Vadodara

·         New Delhi

·         Chennai

·         Bangalore

·         Secunderabad

·         Nagpur

·         Bilaspur

·         Indore

 

 

DIRECTORS

 

AS ON 31.03.2010

 

Name :

Mr. Prayasvin B. Patel

Designation :

Chairman and Managing Director

Date of Birth/Age

01/07/1983

Qualification

B. E. (Mech.) M. B. A.

 

 

Name :

Mr. Pradip M. Patel

Designation :

Director

 

 

Name :

Mr. Upendra M. Patel

Designation :

Director

 

 

Name :

Mr. Chirayu R. Amin

Designation :

Director

 

 

Name :

Mr. Ashok J. Patel

Designation :

Director

 

 

Name :

Mr. Hasmukhlal S. Parikh

Designation :

Director

 

 

Name :

Dr. Amritlal C. Shah

Designation :

Director

 

 

Name :

Mr. Nanalal D. Shah

Designation :

ICICI Nominee

 

 

Name :

Mr. Prashant Amin 

Designation :

Director

 

 

KEY EXECUTIVES

 

Name :

Mr. Nayan M. Adhyaru

Designation :

Company Secretary

 

 

Name :

Mr. Hemendra C. Shah

Designation :

Chief Financial Officer

 

 

Name :

Mr. Chirag Darji

Designation :

Deputy Manager Accounts

 

 

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

 

AS ON 31.03.2011

 

Names of Shareholders

No. of Shares

Percentage of Holding

(A) Shareholding of Promoter and Promoter Group

 

 

(1) Indian

 

 

Individuals / Hindu Undivided Family

40368463

43.47

 

 

 

        Any Others

 

 

         Directors/Promoters and their Relatives and Friends 

2080775

2.24

 

 

 

(2) Foreign

 

 

 

 

 

(B) Public Shareholding

 

 

(1) Institutions

 

 

Mutual Funds / UTI

11024128

11.87

Financial Institutions / Banks

54825

0.06

Insurance Companies

278648

0.30

Foreign Institutional Investors

2227652

2.40

 

 

 

Any Others (Specify)

 

 

Foreign Mutual Fund

884210

0.95

 

 

 

(2) Non-Institutions

 

 

Bodies Corporate

6962893

7.50

 

 

 

Individuals

 

 

Individual shareholders holding nominal share capital up to Rs.0.100 Million

23717774

25.54

Individual shareholders holding nominal share capital in excess of Rs.0.100 Million

3498910

3.77

 

 

 

Any Others (Specify)

 

 

Clearing Members

254062

0.27

Market Maker

43414

0.05

Non Resident Indians

835264

0.90

Hindu Undivided Families

538688

0.58

Trusts

15112

0.02

            Directors and Relatives

73662

0.08

 

 

 

Total

92861510

100.00

 

 

BUSINESS DETAILS

 

Line of Business :

Manufacturer and Supplier of Material Handling Equipments and Reduction Gears.

 

 

Products :

Item Code No.

Product Description

 

843139.01

Elevators, Conveyors and Moving Machinery (Conveying Equipments)

842299.00

Gears (Reduction Gears)

847420.02

Crushers (Crushers, Screens, Feeders)

 

 

Terms :

 

Selling :

Depend

 

 

Purchasing :

Depend

 

 

PRODUCTION STATUS (AS ON 31.03.2009)

 

Particulars

Unit

Licensed Capacity *

Installed Capacity *

Actual Production +

Conveying Equipments

Tonnes

28000

15000

10699.39

Wagon Tippler and Dust Trapping Equipment

Nos.

16 sets each

16 sets each

11

Crushers, Screens and Feeders

Tonnes

1500

1000

530.03

Specialised Conveying Equipment, Stacker Reclaimers, Blender Reclaimers, Rotary Disc Loaders etc.

Tonnes

10000

3000

2333.84

Reduction Gears and Geared Motors

Nos.

55000

55000

32178

Wagon Marshalling Equipment

Tonnes

300

300

200.023

EOTCranes and Goliath Cranes

Nos.

230

100

--

Wind Turbine Generators

Nos.

2500

50

--

Axles**

Nos.

1500

1500

89

 

* As certified by the Management

 

+ As per DGTD return

 

** For Captive consumption

 

GENERAL INFORMATION

 

Suppliers :

·         A G System Controls

·         A Bond Strands, Chennai

·         Air Flow Engineers, Vallabh Vidyanagar

·         Akvim Industries, Mumbai

·         Amin Panels, Vallabh Vidyanagar

·         B. R. Electronic, Vallabh Vidyanagar

·         Baroda Cap Liners

·         Bhavik Enterprise, Vallabh Vidyanagar

·         Bright Bar Manufacturing Company Bharuch

·         Bright Steel Mac Fabrics

·         Control Equipments Manufacturing Company Vallabh Vidyanagar

·         Deep Engineering Works, Vallabh Vidyanagar

·         Delimon Protos (India) Private Limited, Mumbai

·         Dipco Engineering Company, Vallabh Vidyanagar

·         Forging India Iron and Steel Company

·         Gujarat Foundries, Ahmedabad

·         Gujarat Plug In Devices Private Limited

·         Heliflex Hydraulic and Engineering

·         Ind-Tech Engineers

·         JK Springs, Vallabh Vidyanagar

·         K. C. Industries

·         Kavil Engineering Works, Vallabh Vidyanagar

·         Mahavir Casting, Ahmedabad

·         Marigold Paints, Vallabh Vidyanagar

·         Max Engineering and Marketing Company

·         Maxwell Engineering Company Vallabh Vidyanagar

·         Megha Engineering, Vallabh Vidyanagar

·         Metal Treat Industries, Vallabh Vidyanagar

·         Microfine Products, Baroda

·         Monarch Rubber Industries, Vallabh Vidyanagar

·         Navin Engineering Works, Vallabh Vidyanagar

·         Nikko Industries Products Private Limited, Baroda

·         Osaka Electronics Private Limited

·         Packme Industries

·         Patt O Cast, Vallabh Vidyanagar

·         Positronics Controls Systems

·         Positronix Private Limited

·         Power Grip (India) Fasteners Private Limited

·         Quality Engineering Works, Vallabh Vidyanagar

·         Raj Engineering Works, Vallabh Vidyanagar

·         Rexspro Industries

·         Shreenathji Rubber Industries

·         Sunrise Engineering Company

·         Techni Aids, Ahmedabad

·         Vikrant Alloys and Forgings Private Limited

·         Vinod Industries, Vallabh Vidyanagar

·         Wl Heat Treaters and Consultants

·         Windston Springs Private Limited, Mumbai

·         WRC Engineering

 

 

Customers :

·         Industries

 

 

No. of Employees :

2000 (Approximately)

 

 

Bankers :

·         State Bank of India, CAG Branch

·         ICICI Bank Limited

·         Bank of Baroda, CFS Branch

·         HDFC Bank Limited, Ahmedabad Branch

·         Canara Bank, Ahmedabad Branch

·         ABN Amro Bank

·         EXIM Bank, Ahmedabad Branch

·         IDBI Limited

·         Axis Bank Limited

·         State Bank of Saurashtra

 

 

Facilities :

Secured Loans

31.03.2010

[Rs. in Millions]

31.03.2009

[Rs. in Millions]

Loans and Advances from State Bank of India/ Bank of Baroda/ State Bank of Saurashtra/ Exim Bank/ Axis Bank/ Citi Bank HDFC Bank

 

 

Cash Credit / Demand Loan

1887.032

3229.572

Term Loan

(Repayable within a year Rs.89.806 Millions)

1427.017

1996.287

Other Loans and Advances

 

 

HP from Other Banks

14.721

10.233

(Repayable within a year Rs.6.971 Millions)

 

 

Total

3328.770

5236.092

 

 

 

UNSECURED LOANS

31.03.2010

[Rs. in Millions]

31.03.2009

[Rs. in Millions]

Short Term Loan from Banks

 

 

From : Standard Chartered Bank

30.317

118.000

From : Vijaya Bank

299.826

0.000

From : Bank of Nova Scotia

399.995

0.000

Working Capital Demand Loan

 

 

From Indusind Bank

375.000

423.465

Loans and advances from others

38.006

143.087

Commercial Paper

743.669

0.000

Interest accrued and due on above

0.176

0.176

Total

1886.989

684.728

 

 

 

Banking Relations :

--

 

 

Financial Institution :

·         HDFC Trustee Company Limited

·         ICICI Prudential Fusion Fund Series

·         TATA AIG LIF3E Insurance Company Limited

·         UTI- Infrastructure Fund

 

 

Auditors :

 

Name :

Thakorebhai-Shirish Desai and Butala

(Division of Thacker Butala Desai)

Chartered Accountants

Address :

Navsari, Gujarat, India 

 

 

Associates and Joint Ventures :

·         Madhuban Prayas Resorts Limited

·         PWH Materials Handling Limited

·         Ringspann Elecon (I) Limited

·         Eimco Elecon (India) Limited

 

 

Associates :

·         Bipra Investments and Trusts Private Limited

·         Devkishan Investment Private Limited

·         K. B. Investments Private Limited

·         Elecon Information Technology Limited

·         Emtici Engineering Limited

·         Prayas Engineering Limited

·         Speciality Wood Pack Private Limited

·         Power Build Limited

·         Kirloskar Power Build Gears Limited

·         Akaaish Mechatronics Limited

·         Narmada Travels Limited

·         Elecon Australia Pty. Limited

·         Elecon Africa Pty. Limited

·         Elecon Singapore Pte. Limited

·         Elecon Middle East FZCO

·         Elecon Engineering (Suzhou) Company Limited, China

·         Wizard Fincap Limited

 

 

CAPITAL STRUCTURE

 

AS ON 31.03.2010

 

Authorised Capital :

No. of Shares

Type

Value

Amount

225000000

Equity Shares

Rs.2/- each

Rs.450.000 millions

25000000

Cumulative Redeemable Preferences Shares

Rs.2/- each

Rs.50.000 Millions

 

Total

 

Rs.500.000 Millions

 

Issued, Subscribed & Paid-up Capital :

No. of Shares

Type

Value

Amount

92861510

Equity Shares

Rs.2/- each

Rs.185.723 millions

 

 

 

 

 

NOTES:

 

Of the above

 

·         342100 equity shares of Rs.2/- each in above (originally allotted 68,420 equity Shares of Rs.10/- each) were issued as fully paid-up, pursuant to a contract without payment being received in cash.

 

·         17338890 equity shares of Rs.2/- each in above (originally allotted 34,67,778 equity Shares of Rs.10/- each) were issued as Bonus Shares by way of capitalisation of Share Premium and Reserves.

 

·         5498160 equity shares of Rs.2/- each in above (originally allotted 10,99,632 equity Shares of Rs.10/- each) were issued as fully paid-up equity shares on conversion of debentures.

 

·         2716787 Equity Shares of Rs2/- were allotted as fully paid-up equity shares on conversion of FCCB of Series ‘A’ 9,000 nos. of $ 1,000 each.

 

·         61907673 Equity Shares of Rs.2/- each in above were issued as Bonus Shares by way of capitalisation of Share Premium and Reserves.

 

 

 

 

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

185.723

185.723

185.700

2] Share Application Money

0.000

0.000

0.000

3] Reserves & Surplus

3075.341

2568.277

2181.500

4] (Accumulated Losses)

0.000

0.000

0.000

NETWORTH

3261.064

2754.000

2367.200

LOAN FUNDS

 

 

 

1] Secured Loans

3328.770

5236.092

3329.400

2] Unsecured Loans

1886.989

684.728

763.200

TOTAL BORROWING

5215.759

5920.820

4092.600

DEFERRED TAX LIABILITIES

402.585

327.803

186.500

 

 

 

 

TOTAL

8879.408

9002.623

6646.300

 

 

 

 

APPLICATION OF FUNDS

 

 

 

 

 

 

 

FIXED ASSETS [Net Block]

3622.198

3110.193

1771.500

Capital work-in-progress

0.000

0.000

159.200

 

 

 

 

INVESTMENT

56.757

108.680

94.500

DEFERREX TAX ASSETS

0.000

0.000

15.400

DEFERRED EXPENDITURE

26.048

16.888

0.000

 

 

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

 

 

 

Inventories

3151.846

4007.466

2526.000

 

Sundry Debtors

5175.855

4717.358

4923.200

 

Cash & Bank Balances

388.126

610.587

75.300

 

Other Current Assets

0.000

0.000

               0.000

 

Loans & Advances

546.743

749.179

           571.900

Total Current Assets

9262.570

10084.590

8096.400

Less : CURRENT LIABILITIES & PROVISIONS

 

 

 

 

Sundry Creditors

2946.948

2816.781

3289.500

 

Other Current Liabilities

921.333

1269.924

 

 

Provisions

219.884

231.023

210.900

Total Current Liabilities

4088.165

4317.728

3500.400

Net Current Assets

5174.405

5766.862

4596.000

 

 

 

 

MISCELLANEOUS EXPENSES

0.000

0.000

9.700

 

 

 

 

TOTAL

8879.408

9002.623

6646.300

 

 

 

PROFIT & LOSS ACCOUNT

 

 

PARTICULARS

 

31.03.2010

31.03.2009

31.03.2008

 

SALES

 

 

 

 

 

Income

9719.848

7896.132

8252.000

 

 

Erection and other Charges

743.857

1654.516

0.000

 

 

Other Income

247.718

95.772

97.900

 

 

TOTAL                                     (A)

10711.423

9646.420

8349.900

 

 

 

 

 

Less

EXPENSES

 

 

 

 

 

Consumption of Materials, Sub Contracts, Erection and other charges

6937.692

7374.768

6886.300

 

 

Employees remuneration and benefits

435.185

438.322

 

 

 

Increase/ decrease in stock

346.651

(1054.964)

 

 

 

Administrative Expenses

1170.412

1231.550

 

 

 

Power and Fuel Cost

78.220

70.590

 

 

 

TOTAL                                     (B)

8968.160

8060.266

6886.300

 

 

 

 

 

Less

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

1743.263

1586.154

1463.600

 

 

 

 

 

Less

FINANCIAL EXPENSES                         (D)

508.890

483.680

334.800

 

 

 

 

 

 

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

1234.373

1102.474

1128.800

 

 

 

 

 

Less/ Add

DEPRECIATION/ AMORTISATION                     (F)

331.203

221.471

142.000

 

 

 

 

 

 

PROFIT BEFORE TAX (E-F)                               (G)

903.170

881.003

986.800

 

 

 

 

 

Less

TAX                                                                  (H)

241.417

306.491

314.749

 

 

 

 

 

 

PROFIT AFTER TAX (G-H)                                (I)

661.753

574.512

           672.051

 

 

 

 

 

Add/ Less

Adjustment of Prior period

7.738

(24.809)

0.000

Add

PREVIOUS YEARS’ BALANCE BROUGHT FORWARD

200.875

564.137

155.060

 

 

 

 

 

Less

APPROPRIATIONS

 

 

 

 

                         Transfer to General Reserve

500.000

750.000

100.000

 

 

Proposed Dividend

139.292

139.292

139.300

 

 

Tax on Proposed Dividend

23.135

23.673

23.673

 

BALANCE CARRIED TO THE B/S

207.939

200.875

564.138

 

 

 

 

 

 

EARNINGS IN FOREIGN CURRENCY

 

 

 

 

 

Reduction Gears

361.818

295.211

234.008

 

 

Conveying Equipments

274.674

111.287

136.322

 

 

Interest

0.000

1.543

0.775

 

TOTAL EARNINGS

636.492

408.041

371.105

 

 

 

 

 

 

IMPORTS

 

 

 

 

 

Raw Materials

481.586

1020.119

936.345

 

 

Stores & Spares

27.570

31.405

34.570

 

 

Capital Goods

477.596

850.072

367.864

 

 

Others

0.000

1901.596

1338.779

 

TOTAL IMPORTS

986.752

1901.596

1338.779

 

 

 

 

 

 

Earnings Per Share (Rs.)

7.13

6.19

69.80

 

 

QUARTERLY RESULTS

 

PARTICULARS

 

30.06.2010

30.09.2010

30.09.2010

31.03.2011

Type

1st Quarter

2nd Quarter

3rd  Quarter

4th Quarter

 Sales Turnover

2471.740

2809.130

3023.910

3540.610

 Total Expenditure

2092.540

2409.460

2527.380

2977.540

 PBIDT (Excl OI)

379.200

399.670

496.530

563.070

 Other Income

0.05

4.000

205.460

1.500

 Operating Profit

379.250

403.650

701.990

564.570

 Interest

98.480

106.610

123.430

129.760

 Exceptional Items

0.000

0.000

0.000

0.000

 PBDT

280.770

297.040

578.560

434.810

 Depreciation

89.220

975.100

98.270

99.270

 Profit Before Tax

191.550

199.530

480.290

335.540

 Tax

58.350

57.400

112.060

99.880

 Reported PAT

133.200

142.120

368.230

235.660

Extraordinary Items       

0.000

0.000

0.000

0.000

Prior Period Expenses

0.000

0.000

0.000

0.000

Other Adjustments

0.000

0.000

0.000

0.000

Net Profit

133.200

142.120

368.230

235.660

 

KEY RATIOS

 

PARTICULARS

 

 

31.03.2010

31.03.2009

31.03.2008

PAT / Total Income

(%)
6.18

5.96

9.75

 

 
 

 

 

Net Profit Margin

(PBT/Sales)

(%)
9.29

11.16

11.95

 

 
 

 

 

Return on Total Assets

(PBT/Total Assets}

(%)
7.01

6.68

1.00

 

 
 

 

 

Return on Investment (ROI)

(PBT/Networth)

 
0.28

0.32

0.41

 

 
 

 

 

Debt Equity Ratio

(Total Liability/Networth)

 
2.85

3.72

1.47

 

 
 

 

 

Current Ratio

(Current Asset/Current Liability)

 
2.27

2.34

2.31

 

 

 

LOCAL AGENCY FURTHER INFORMATION

 

HISTORY

 

The company originally established in Mumbai in the year 1951. It shifted the manufacturing base to Vallabh Vidyanagar Near Anand, Gujarat, in 1962.  

 

The company received government approval for its diversification in the manufacture of 1000 hydraulic fluid couplings per annum within its licensed capacity of helical gears in 1984.

 

The company privately placed in 1990-91, 0.500 million 14% secured redeemable non-convertible debentures of Rs.100/- each, with the State Bank of India Capital Markets and Canara Bank in equal proportions to meet its long term working capital needs. These debentures are redeemable at a premium of 5% in three equal annual installments between 19 September 96 and 19 September 98.

 

The company's wholly owned subsidiary Elecon (Chennai) was amalgamated with the company with effect from 1st January, 1987.  In 1994-95, the company entered into technical collaboration with HMZ NV, Belgium for manufacture of windomaster wind energy generators.   In 1994-95 company obtained the ISO 9001 certification for its gear division.  It has executed orders worth Rs.1300.000 millions for Neyveli Lignite Corporation Limited for manufacture, erection and commissioning of 2400 MM drive heads on conveyors for its Mine-II

 

During 1997-98, the company floated a new company to manufacture geared motors and gear reducers with a wide range, in technical collaboration with a Japanese company of international repute.  The company has also formed a joint venture company which will initially undertake manufacturing of industrial freewheels overrunning clutches, spring assemblies, clutches and related parts and components used in power transmission and work holding technology.

 

During 1998-99, the company has launched Posired 2 Helical/ Beval Gears for which the company has entered into a technical collaboration with PIC Antried Werner Reimers GmbH and Company KG, Germany. The Company has simultaneously launched Super NU Universal Mounting Worm Gears which is newly designed and developed series.

 

To market its products in Australia the company has set up a wholly owned subsidiary company namely Elecon Australia Pte. Limited.  It is also in the process of setting up a subsidiary in South Africa.

 

 

REVIEW OF OPERATIONS:
 
For  the year ended on 31.03.2010, the Company has achieved  Turnover of  Rs.10463.705 Millions and Net Profit of Rs.669.410 Millions as  against  the Turnover  of  Rs.9550.648 Millions and  Net  Profit  of  Rs.574.512 Millions respectively during the previous year, representing increase in Turnover of 9.56% and increase in Net Profit by 15.19%.The Company holds un-executed orders worth Rs.12430.125  Millions Rs9965.325 Millions is for the MHE division and Rs2464.8 Millions is for the Gear Division as of  31.03.2010. This will help us to steer the Company in the profitable direction. The Company has ability to attend substantial live  enquiries with excellence. During the current financial year, the Company has begged orders worth Rs.3261.431Millions.

 

MANAGEMENT DISCUSSION AND ANALYSIS
 
INDUSTRY STRUCTURE AND DEVELOPMENT:
 
The year saw relative stability compared to the market turmoil that  were witnessed in the last quarter of 2008-09. The overall  situation was  better  than  we  had apprehended in the  aftermath  of  the  economic slowdown. Amidst the downturn of global economy and stagnation, the  Indian economy  grew  at close to 7%, largely due to low  dependence  on  external factors and a growing domestic demand. Though recessionary trends affected several of the customer segments, there was a noticeable improvement in economic conditions after the first half of 2009-10. Steel price softened significantly during 2009-10 with consequent reductions  in their selling prices and input costs.  However, demand-supply mismatches and inconsistent monsoons put the economy on  an  inflationary trend and the trend continues in the current year. The Company closed the year with stable performance and retained  its position  in  the  falling  market. The Company focused  on  cost  control measures and product mix enrichment to sustain growth and profitability  in the challenging year. In  any industry,  the  trend of demand and supply  is  dependent  on  the economic  growth and the economic environment of the country.  Increase in GDP encourages investment in the infrastructure industry which  ultimately results in modernization of existing facilities and repair and maintenance, of  the  same. This is directly beneficial to the Company as  both  of  the Material  Handling Equipment division and Gear division form  an  essential part of most manufacturing facilities.

 

SEGMENT-WISE PERFORMANCE:
 
During the financial year 2009-2010, the Company has achieved a Turnover of Rs.1065.730Millions as against Rs.9550.648Millions  in the previous year, which shows a growth of 9.56% over the previous year.
 
The  Turnover  of  Gear Division has increased to Rs.4259.205 Millions  from Rs.3943.960 Millions in the previous year, which shows an increase of 8%.The Turnover of MHE Division has increased to Rs.6204.500 Millions as  against Rs.5606.688 Millions in the previous year, which shows an increase of 10.66%.
 
The  Profit Before Tax has increased to Rs.903.100 Millions  from  Rs.881.00 millions in the previous year resulting into an increase of 2.52%.The  Profit  After Tax has increased to Rs.669.410 Millions from  Rs.599.260 Millions ,resulting into an increase of 15.19%, over the previous year.
 
 
OUTLOOK:
 
While  the  world  seems  to  have  returned  on  the  growth  path   after experiencing huge turmoil, the recovery is primarily driven by the stimulus by Central Bank and Governments across the world. India is not an exception to this. The sustainability of the recovery will only be known as and  when the  stimulus  is  withdrawn.  However, in India,  Central  Government  is expected to continue with its stimulus plans for some more time.
 
Global  economic  collapse,  together with  liquidity  squeeze  had  forced corporates  to either scale back their capex plans or at least defer  them. With revival in demand, increased availability of finance through both debt and  equity  route and improved business confidence, these  deferred  capex plans  will  gain traction and materialize, which in turn  will  result  in resumption of various projects by their big clients. Power  is likely to lead the infrastructure cycle. To contain  the  peaking shortages  and  to  meet the incremental demand,  the  Central  Electricity Authority  (CEA)  has targeted a capacity addition of 1,00,000  MW  in  the  XII th  Five  Year  Plan,  a  growth  of  27%.  Due  to  encouragement  from Government, private sector capex in power will improve in the coming years. The Company's MHE Div. supplies majority of its products to Power  Sector, this will help the Company to maintain its business. The  Indian  economy  will continue its growth trajectory on  the  back  of strong  domestic  demand and huge outlay on infrastructure planned  by  the Government. With the recovery in corporate capex cycle and Government's increased focus on  infrastructure, the sector will grow at a rapid pace in  coming years. This will definitely help the Company in developing its business in  this sector.

 

RISK AND CONCERNS:
 
MHE DIVISION:-
 
The  Company believes in quality and is committed to offer satisfaction  to its clients. This is helping the Company to have continuous flow of  orders and  enquiries,  which in turn helps the Company to grow  in  the  volatile  economic situation. The   Government  of  India  (GOI)  has  lot  to  do  for  development   of  infrastructure.  Material  Handling Equipment industry is catering  to  the growing  and  rapidly changing needs of the core industries such  as  Coal, Cement,  Power, Port, Mining, Fertilizers and steel plants. Due to  various  stimulus packages of GOI and global recovery, all these sectors are back on track of growth. However, delay in execution and poor execution of projects hampers the development of the economy and these sectors.

 

GEAR DIVISION:

 

The Company's reputed specialization, in this segment, is being recognised by its clients by providing good business. This results in an  opportunity to  look  for, find and make improvements as well as cost  savings  changes throughout its products. Catering to the needs of almost all sectors of industry helps the  Company  to  have  balanced  growth amidst unpredictable  economic  conditions.  The impact  of  fluctuation  in Steel and other raw material  prices  has  been mitigated to a great extent by using various tools of hedging

 

UNAUDITED FINANCIAL RESULT FOR THE QUARTER ENDED 30TH SEPTEMBER, 2010.

 

(Rs. in millions)

Particulars

Quarter Ended 30th Sept. 2010

(Unaudited)

Half Year Ended

30th Sept. 2010

(Unaudited)

 

 

 

(a) Net Sales / Income from operations

3001.845

5637.516

Less: Excise Duty

206.897

382.100

a. Net Sales/ Income from Operations

2794.948

5255.416

b. Other Operating Income

14.176

25.452

Total Income

2809.124

5280.868

 

 

 

Expenditure

 

 

a) (Increase) / Decrease in stock in trade and work in progress

(6.667)

(65.077)

b) Consumption of raw materials

1880.734

3831.107

c) Purchase of traded goods

--

--

d) Employees cost

156.306

275.921

e) Depreciation

97.611

186.725

f) Other Expenditure

379.097

660.095

Total

2506.981

4688.771

 

 

 

Profit from operations before other income, interest and exceptional Items

302.143

592.097

 

 

 

Other income

3.996

4.045

 

 

 

Profit before interest and exceptional Items

306.139

596.142

 

 

 

Interest

106.614

205.069

 

 

 

Profit after Interest but before Exceptional Items

199.525

391.073

 

 

 

Exceptional Items

--

--

 

 

 

Profit (+)/Loss(-) from Ordinary Activities before tax

199.525

391.073

 

 

 

Tax expense

 

 

 

 

 

 - Current

52.374

107.300

 

 

 

 - Deferred

5.030

8.457

 

 

 

Net Profit (+)/Loss(-) from Ordinary Activities after

tax

142.121

275.316

 

 

 

Net Profit (+) / Loss (-) for the year period

142.121

275.316

 

 

 

Paid up equity share capital (Face value of Rs.10/- per share)

1857.23

1857.23

 

 

 

Reserves excluding revaluation reserves as per balance sheet of previous accounting year

33506.59

33506.59

 

 

 

Earning per share (EPS)

 

 

 (a) Basic and diluted EPS before Extraordinary items

for the period, for the year to date and for the

previous year (not to be annualised)

1.53

2.96

(a) Basic and diluted EPS before Extraordinary items

for the period, for the year to date and for the

previous year (not to be annualised)

1.53

2.96

 

 

 

Public shareholding

 

 

          Number of shares

50416272

50416272

          Percentage of shareholding

54.29%

54.29%

 

 

 

Promoters and Promoters group Shareholding-

 

 

a) Pledged /Encumbered

 

 

Number of shares

8249850

8249850

Percentage of shares (as a % of total shareholding of the promoter and promoter group)

19.44%

19.44%

Percentage of shares (as a % of total share capital of the company)

8.89%

8.89%

 

 

 

b) Non  Encumbered

 

 

Number of shares

34195388

34195388

Percentage of shares (as a % of total shareholding of the promoter and promoter group)

80.56%

80.56%

Percentage of shares (as a % of total share capital of the company)

36.82%

36.82%

 

NOTE:

 

1) The aforesaid financial results ware placed before the Audit Committee and reviewed by it at its meeting held on October 27, 2010 and taken on record by the Board of Directors in their Meeting held on the same date.

 

2) The Statutory Auditors have carried out a ‘Limited Review’ of the above financial results of the Company.

 

3) Information on investor complaints for quarter ended September 30, 2010 is as under.

 

- Complaints pending as on July 1, 2010 – Nil

- Complaints received during the quarter – 06

- Complaints solved during the quarter – 06

- Complaints pending as on September 30. 2010 – Nil

 

4) @ Other Expenditure for the quarter ended September 30, 2010 includes Loss on foreign Exchange of Rs.10.977 Millions (corresponding quarter ended September 30, 2009 include Loss on foreign exchange of Rs.12.006 Millions) and Half year ended September 30, 2010 includes Loss on foreign exchange of Rs.4.055 Millions (corresponding Half year ended September 30, 2009 includes Loss on foreign exchange of Rs.23.781 Millions)

 

5) Disclosure of assets and liabilities as per clause 41(l) (ea) of Listing Agreement for the half year ended September 30, 2010 is attached.

 

6) During the Quarter, CARE Limited has retained credit rating of the company as “PR 1 + (the highest rating) for short term borrowings and “CARE AA-” (2nd highest rating) for long term borrowings.

 

7) The Company through its SPVs has decided to acquire the Benzlor- Radieon group of businesses from David Brown Gear Systems Group. The Company has already intimated the same to BSE and NSE on October 25, 2010.

 

8) The previous period figures have been regrouped/ recast wherever necessary to make it appropriate for comparison purpose.

 

DISCLOSURE OF ASSETS AND LIABILITIES AS PER CLAUSE 41 (I) (EA) OF THE LISTING AGREEMENT FOR THE HALF YEAR ENDED SEPTEMBER 30, 2010

 

(Rs. in millions)

Particulars

Half Year Ended

30th Sept. 2010

(Unaudited)

 

 

SHAREHOLDERS FUNDS

 

Share Capital

185.723

Reserves & Surplus

3350.659

Total

3536.382

 

 

LOAN FUNDS

5220.609

 

 

DEFERRED TAX LIABILITIES

411.042

 

 

TOTAL

 

9168.032

 

 

FIXED ASSETS

3628.576

 

 

INVESTMENT

61.357

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

Inventories

3261.683

Sundry Debtors

5447.836

Cash & Bank Balances

329.240

Other Current Assets

0.000

Loans & Advances

473.001

 

9511.760

 

 

Less : CURRENT LIABILITIES & PROVISIONS

 

Other Current Liabilities

3996.203

Provisions

60.199

 

4056.402

 

 

Net Current Assets

5455.358

 

 

Miscellaneous Expenditure (Not written off or Adjusted)

22.740

 

 

TOTAL

9168.032

 

TRADE REFERENCES:

 

·         B.R. Electronic, Vallabh Vidyanagar

·         Akvim Industries, Mumbai

·         Kavil Engineering Works, Vallabh Vidyanagar

 

CONTINGENT LIABILITIES (AS ON 31.03.2009)

 

No provision has been made in the accounts in respect of the following:

 

a) Disputed Excise Duty Rs.22.970 Millions (previous year Rs.24.685 Millions), against demand notices received so far.

 

b) Disputed Sales Tax/ Works Contract Tax Rs.34.755 Millions (previous year Rs.56.385 Millions).

 

c) In respect of disputed Income Tax demands:

 

(i) Disputed by Company Rs.8.767 Millions (previous year Rs.99.912 Millions)

 

(ii) Disputed by Income Tax Authorities Rs. NIL (previous year Rs. NIL)

 

d) Guarantees issued by the Company’s Bankers Rs.4173.085 Millions (previous year Rs.3042.967 Millions)

 

e) Liability for export obligation under Export Promotion Credit Guarantee Rs.1298.521 Millions (previous year

Rs.1322.868 Millions).

 

f) Sales Bills discounted under LC with Banks Rs.243.566 Millions (previous year Rs.184.138 Millions).

 

g) Corporate Guarantees given on account of advance received from customers Rs.65.614 Millions (Previous Year Rs.73.357 Millions) and on account of performance Rs.234.283 Millions (Previous Year Rs.99.899 Millions)

 

FIXED ASSETS

 

·         Land

·         Building

·         Plant and Machinery

·         Electrical Installations

·         Electrical Fittings

·         Office Equipments

·         Air Conditioning Plant

·         Sundry Equipments

·         Furniture and Fixture

·         Vehicles

·         Site Office Equipments

 

WEBSITE DETAILS:

 

PRESS RELEASES:

 

ELECON ENGINEERING WINS PRESTIGIOUS ORDER WORTH RS. 405.100 MILLIONS.

 

Mumbai 20th December, 2010: Elecon Engineering Company Limited, India’s largest Material Handling Equipments, Industrial Gears and Transmission Products manufacturer today announced that their Material Handling Equipment (MHE) division has received prestigious orders worth Rs.405.100 Millions from Energo Engineering Projects Limited.


INFORMATION OF ORDER RECEIVED

 

 Name of Client

 Energo Engineering Projects Limited  

 Place

 Okhla Industrial Area, New Delhi

 Type of Order

 Design, Engineering, Manufacturing, Assembly, Inspection and Testing, Erection and Commissioning of complete COAL HANDLING PACKAGE with mandatory spares.

 Quantity

 1 Reversible Bucket Wheel Stacker Reclaimer, Rota Side Gear Drive Wagon Tippler, Side Arm Charger and Apron Feeder including mandatory spares, auxiliaries and ancillaries.

 Total Value of Order 

 

 405.100 Millions

 

Mr. Prayasvin Patel, Chairman and Managing Director, Elecon Engineering said, “We are delighted to have procured prestigious order worth Rs.405.100 Millions. Elecon Engineering has always been in the forefront of innovations and technology in the manufacturing and engineering sector. It is a big achievement for all at Elecon and gives us a good momentum to

 

 

About Elecon Engineering Company Limited


Established in 1951, Elecon Engineering Company Limited of Vallabh Vidyanagar, Gujarat, India, pioneered the manufacture of material handling equipments http://www.elecon.com. For over five decades, Elecon has designed and implemented several landmark projects in India as well as abroad. From a modest start of design and manufacture of Elevators and Conveyors from which incidentally, the company derives its corporate identity. viz. "Elecon". It has grown over the years to be known as a pioneer of the concept of mechanized way of Bulk Material Handling Equipments in India. During this span, Elecon has encompassed all the major core sectors through its supplies of highly sophisticated equipment bearing ample testimony of the symbolic mark of Elecon's unbeatable technology. Elecon has thus, made its presence felt through consistent and satisfactory performance of its equipment in such core sectors as fertilizer, cement, coal/power generation, chemical, steel plant and port mechanization etc., across the country.

 

 

 

 

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.45.10

UK Pound

1

Rs.71.88

Euro

1

Rs.63.75

 

 

SCORE & RATING EXPLANATIONS

 

SCORE FACTORS

 

RANGE

POINTS

HISTORY

1~10

6

PAID-UP CAPITAL

1~10

7

OPERATING SCALE

1~10

7

FINANCIAL CONDITION

 

 

--BUSINESS SCALE

1~10

8

--PROFITABILIRY

1~10

8

--LIQUIDITY

1~10

8

--LEVERAGE

1~10

7

--RESERVES

1~10

8

--CREDIT LINES

1~10

7

--MARGINS

-5~5

-

DEMERIT POINTS

 

 

--BANK CHARGES

YES/NO

YES

--LITIGATION

YES/NO

NO

--OTHER ADVERSE INFORMATION

YES/NO

NO

MERIT POINTS

 

 

--SOLE DISTRIBUTORSHIP

YES/NO

NO

--EXPORT ACTIVITIES

YES/NO

YES

--AFFILIATION

YES/NO

YES

--LISTED

YES/NO

YES

--OTHER MERIT FACTORS

YES/NO

YES

TOTAL

 

66

 

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.