MIRA
INFORM REPORT
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Report Date : |
05.03.2011 |
IDENTIFICATION DETAILS
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Name : |
HINDALCO INDUSTRIES LIMITED |
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Registered
Office : |
Century Bhavan, 3rd Floor, |
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Country : |
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Financials (as
on) : |
31.03.2010 |
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Date of
Incorporation : |
15.12.1958 |
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Com. Reg. No.: |
11-11238 |
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CIN No.: [Company Identification
No.] |
L27020MH1958PLC011238 |
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TAN No.: [Tax Deduction &
Collection Account No.] |
MUMI05060G |
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PAN No.: [Permanent Account No.] |
AAACH1201R |
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Legal Form : |
Public Limited
Liability Company. The Company’s
Shares are Listed on the Stock Exchanges |
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Line of Business
: |
Manufacturer of
Aluminium Products. |
RATING & COMMENTS
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MIRA’s Rating : |
Aa (74) |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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 |
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Maximum Credit Limit : |
USD 1116438800 |
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Status : |
Excellent |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a part of Aditya Birla Group. It is a well established and
a reputed company having fine track.
Financial position of the company appears to be sound. Fundamentals are
strong and healthy. 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 any 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
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Country Name |
Previous Rating (31.12.2009) |
Current Rating (01.04.2010) |
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A1 |
A1 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
INFORMATION PARTED BY
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Name : |
Mr. S. Talukdar |
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Designation : |
CFO |
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Date : |
04.03.2011 |
LOCATIONS
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Registered Office/ Marketing Head Office: |
Century Bhavan, 3rd
Floor, |
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Tel. No.: |
91-22-24308491 /
92 / 93 / 66626666 |
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Mobile No. : |
91-9964225222
(Mr. Manotosh Chakraborty) |
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Fax No.: |
91-22-24227586 /
24362516 |
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E-Mail : |
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Website : |
http://www.adityabirla.com/hindalco http://www.hindalco.com |
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Corporate
Office 1/ - Marketing Head
Office (Copper) : |
Aditya Birla Centre, III Floor, B Wing, S. K. Ahire Marg,
Worli, Mumbai – 400030, |
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Tel No.: |
91-22-66525000/ 24995000 |
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Fax No.: |
91-22-66525847/24995841 |
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Email : |
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Website: |
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Corporate
Office 2: |
Foil and Packaging Business, Kalwa Works, Thane
Belapur Road, Near Vitawa Village, Kalwa, Thane-400 605, Maharashtra, India |
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Tel. No.: |
91-22-25347151 |
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Fax No. : |
91-22-24227586 |
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Email : |
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Principal
office and Works / Renusagar Power Division |
District
Sonbhadra, P. O. Renukoot – 231217, Mirzapur, |
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Tel. No.: |
91-5446-252077-9/
272501-5 |
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Fax No.: |
91-5446-252107 /
252427/ 272382 |
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E-Mail : |
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Birla Copper
Division: |
P. O. Dahej,
Lakhigam, Dist. Bharuch - 392130, |
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Tel. No.: |
91-2641-256004-06/251009 |
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Fax No.: |
91-2641-251002-3 |
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E-Mail : |
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Foil and Wheels
Division: |
Village Khutli,
Khanvel, Silvassa – 396 230, |
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Tel. No.: |
91-260-2677021-4 |
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Fax No.: |
91-260-2677025 |
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Export Office: |
9/1, |
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Tel. No.: |
91-33-22480949 /
22200464 |
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Fax No.: |
91-33-22200214 |
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Email: |
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Regional
Office 1 (North) (Aluminium) : |
Vandana House, 5th
floor, 11 Tolstoy Marg, |
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Tel. No.: |
91-11-42200204/ 228/
230/ 271/ 200 |
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Fax No.: |
91-11-23721595 |
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Email: |
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Regional
Office 2 (East) (Aluminium) : |
Industry House, 9th
Floor, 10, |
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Tel. No.: |
91-33-22809710 |
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Fax No.: |
91-33-22886139 |
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Email: |
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Regional
Office 3 (South) (Aluminium): |
Industry House, 7th
Floor, 45, |
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Tel. No.: |
91-80-40416010/
21/ 22/ 00 |
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Email: |
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Regional
Office 4 (West) ((Aluminium: |
Ahura Centre, 1st
Floor, 82, |
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Tel. No.: |
91-22-66917031/
30/ 37/ 40/ 00 |
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Fax No.: |
91-80-22533086 |
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Email: |
Rajiv.parulekar@adityabirla.com |
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Factory : |
ALUMINIUM
AND POWER Renukoot
Plant P.O. Renukoot -231217, Dist Sonbhadra Uttar Pradesh, Tel : 91-5446-252077-9 Fax: 91-5446-252107 Renusagar
Power Division P. O. Renusagar, Dist. Sonbhadra Tel : 91-5446-272502-5 Fax: 91-5446272382 Alupuram
Smelter Alupuram P.B. No. 30, Kalamassery 683 104, Dist:
Ernakulam, Tel: 91-484-2532441 Fax: 91-484-2532468 Hirakud
Smelter Hirakud 768 016, Dist: Sambalpur, Tel: 91-663-2481307 Fax: 91-663-2481356 Hirakud
Power Post Box No.12, Hirakud 768 016, Dist: Sambalpur, Tel: 91-663-2481408 Fax: 91-663-2481342 Talabira
Mines Talabira-1, Qrs. No. A6/1, Saraswati Vihar, P.O. Sankarma,
Dist. Sambalpur, Tel: 91-663-2540426 Fax: 91-663-2540526 COPPER: Birla
Copper Division P.O. Dahej, Lakhigam Post, Dist. Bharuch – 392 130, Tel: 91-2641- 256004-06/ 251009 Fax: 91-2641- 251002-3 CHEMICALS: Muri
Alumina Post Chotamuri-835 101, Dist: Phone: 91-6522- 244396 Fax: 91-6522-244231 Village Yamanapur , Tel: 91-831-2472716 Fax: 91-831-2472728 Chandgad
Mines At Post: Chandgad 416509, Dist: Tel/Fax: (02320) 213342 Durgmanwadi
Mines At Post Radhanagri, Dist: Tel: 91-2321-260036 Fax: 91-2321-260037 Lohardaga
Mines Dist: Lohardaga 835 302, Jharkhand Tel/ Fax: 91-6526-224446 SHEET,
FOIL, WHEEL, PACKAGING AND EXTRUSIONS Foils and Wheels Division, Village Khutli, Khanvel,
Silvassa-396 230, U.T., Tel: 91-260-2677021 – 4 Fax: 91-260-2677025 Belur
Sheet 39, Tel: 91-33-2654 7210 Fax: 91-33-2654 9982 Taloja
Sheet Plot 2, MIDC Industrial Area, Taloja A.V., Dist : Raigad,
Navi Mumbai - 410 208, Tel: 91-22-2741 2261/ 66292929 Fax: 91-22-2741 2430 Kalwa
Foil Thane Tel: 91-22- 25347151/52 Fax: 91-22- 25348798 Alupuram
Extrusions Alupuram, P.B. No.30, Kalamassery - 683 104, Dist:
Ernakulam, Tel: 91-484-2532441 Fax: 91-484- 2532468 Mouda
Unit Village Dahali, Tel: 91-7115-660777/786 Kollur
Works Village- Kollur, Re Puram Mandal, Via Mutangi, Medak Dist,
Andhra Pradesh – 502 300, Tel: 91-8413- 234300/ 234204/05 Fax: 91-8455-288829 |
DIRECTORS
AS ON 03.09.2010
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Name : |
Mr. Kumar Mangalam
Birla |
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Designation : |
Chairman |
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Address : |
16-A, IL-Palazzo, Little |
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Date of Birth/Age : |
42 Years |
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Date of Appointment : |
16.11.1992 |
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Name : |
Mrs. Rajashree Birla |
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Designation : |
Non-Executive Director |
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Address : |
16-A, IL- Palazzo, Little |
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Date of Birth/Age : |
64 Years |
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Date of Appointment : |
15.03.1996 |
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Name : |
Mr. D. Bhattacharya |
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Designation : |
Managing Director |
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Address : |
14/A, Woodlands, |
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Date of Birth/Age : |
61 Years |
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Date of Appointment : |
30.04.2003 |
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Name : |
Mr. A.K. Agarwala |
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Designation : |
Non-Executive Director |
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Address : |
“Haveli”, Flat No.3, L.D. Ruparel Marg, Mumbai – 400
006, |
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Date of Birth/Age : |
76 Years |
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Date of Appointment : |
11.09.1998 |
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Name : |
Mr. C.M. Maniar |
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Designation : |
Non-Executive Director |
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Address : |
Garden House, 1st Floor, Dadyseth, 2nd |
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Date of Birth/Age : |
73 Years |
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Date of Appointment : |
08.03.1983 |
KEY EXECUTIVES
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Name : |
Mr. E.B. Desai |
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Designation : |
Non-Executive Director |
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Address : |
Sonarica, 81-A, |
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Date of Birth/Age : |
78 Years |
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Date of Appointment : |
05.04.1984 |
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Name : |
Mr. S.S. Kothari |
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Designation : |
Non-Executive Director |
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Address : |
87-B, Gaurav Nagar, Civil Lines, Jaipur - 302 006, |
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Date of Birth/Age : |
87 Years |
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Date of Appointment : |
22.12.1988 |
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Name : |
Mr. M. M. Bhagat |
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Designation : |
Non-Executive Director |
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Address : |
13, |
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Date of Birth/Age : |
76 Years |
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Date of Appointment : |
16.03.1996 |
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Name : |
Mr. K. N. Bhandari |
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Designation : |
Non-Executive Director |
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Address : |
5, New |
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Date of Birth/Age : |
67 Years |
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Name : |
Mr. N. J. Zhaveri |
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Designation : |
Non-Executive Director |
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Name : |
Mr. S. Talukdar |
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Designation : |
Group Executive President and Chief Financial Officer |
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Date of Birth/Age : |
57 Years |
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Qualification : |
B.Sc., A.C.A. |
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Experience : |
30Years |
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Date of Appointment : |
01.10.1986 |
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Name : |
Mr. R. Ram |
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Designation : |
Senior President and CFO |
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Name : |
Mr. Vinit Kaul |
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Designation : |
Chief People Officer |
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Name : |
Mr. R .K. Kasliwal |
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Designation : |
Group Executive President and Chief Financial Officer |
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Date of Birth/Age : |
64 Years |
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Qualification : |
B.Com, F.C.A. |
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Experience : |
41 Years |
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Date of Appointment : |
04.12.1967 |
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Name : |
Mr. S N Jena |
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Designation : |
Chief Operating Officer |
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Name : |
Mr. Shashi K. Maudgal |
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Designation : |
Chief Marketing Officer |
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Date of Birth/Age : |
55 Years |
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Qualification : |
B.Tech. (Chem. Engg.), P.G. Diploma (Marketing and
Finance) |
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Experience : |
30 Years |
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Date of Appointment : |
14.02.2001 |
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Name : |
Mr. R S Dhulkhed |
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Designation : |
Senior President (Operating) |
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Name : |
Mr. S. M. Bhatia |
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Designation : |
President (Foil and Wheel) |
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Date of Birth/Age : |
55 Years |
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Qualification : |
B.Sc. Engg. (Mech.) |
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Experience : |
34 Years |
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Date of Appointment : |
01.09.2004 |
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Name : |
Mr. Vinod Sood |
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Designation : |
Joint President (Chemical and International Trade) |
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Name : |
Mr. Anil Kumar Sinha |
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Designation : |
President (Human Resources) |
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Name : |
Mr. D.K. Kohly |
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Designation : |
Chief Operating Officer |
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Name : |
Mr. Ashok Machher |
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Designation : |
Joint President (F and C) |
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Name : |
Mr. S.N. Bontha |
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Designation : |
CEO |
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Name : |
Mr. S.N. Jena, |
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Designation : |
Chief Operating Officer |
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Name : |
Mr. Dilip Gaur, |
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Designation : |
Group Executive President |
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Name : |
Mr. Shambhu Sharma |
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Designation : |
President and Chief Operating Officer |
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Name : |
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Designation : |
Joint President (Finance and Commercial) |
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Name : |
Mr. J.P. Paliwal |
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Designation : |
Joint Executive President (Commercial) |
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Name : |
Mr. B.M. Sharma |
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Designation : |
Chief Marketing Officer |
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Name : |
Mr. Anil Malik |
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Designation : |
Company Secretary |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 31.12.2010
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Names of Shareholders |
No. of Shares |
Percentage of Holding |
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(A)
Shareholding of Promoter and Promoter Group |
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2,398,696 |
0.14 |
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595,082,362 |
34.11 |
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16,316,130 |
0.94 |
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16,316,130 |
0.94 |
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613,797,188 |
35.18 |
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Total
shareholding of Promoter and Promoter Group (A) |
613,797,188 |
35.18 |
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(B)
Public Shareholding |
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63,497,755 |
3.64 |
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5,290,889 |
0.30 |
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287,480 |
0.02 |
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205,893,352 |
11.80 |
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570,094,189 |
32.67 |
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845,063,665 |
48.43 |
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94,668,189 |
5.43 |
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131,024,676 |
7.51 |
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10,809,900 |
0.62 |
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49,486,209 |
2.84 |
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10,172,235 |
0.58 |
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3,949,458 |
0.23 |
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34,592,471 |
1.98 |
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772,045 |
0.04 |
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285,988,974 |
16.39 |
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Total
Public shareholding (B) |
1,131,052,639 |
64.82 |
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Total
(A)+(B) |
1,744,849,827 |
100.00 |
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(C)
Shares held by Custodians and against which Depository Receipts have been
issued |
- |
- |
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15,542,309 |
- |
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153,952,179 |
- |
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169,494,488 |
- |
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Total
(A)+(B)+(C) |
1,914,344,315 |
- |
(1) Indian
Individuals / Hindu Undivided Family
TrustsBUSINESS DETAILS
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Line of Business : |
Manufacturer of
Aluminium Products. |
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Products : |
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Exports : |
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Products : |
Aluminium Alloy Billets |
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Countries : |
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Imports : |
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Products : |
Raw Materials |
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Countries : |
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Terms : |
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Selling : |
L/C, Cash and Credit (30 / 60 / 90 days) |
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Purchasing : |
L/C, Cash and Credit (30 / 60 / 90 days) |
PRODUCTION STATUS AS ON (31.03.2010)
Particulars in respect of Goods manufactured: -
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Class of goods |
Installed Capacity |
Actual Production |
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Aluminium Metal |
500000* |
555404 |
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Rolled Products |
205000 |
205265 |
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Extruded Products |
31000 |
38909 |
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Conductor Redraw Rods |
56400 |
91903 |
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Aluminium Foil |
40000 |
16920 |
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Aluminium Wheel |
** Pcs |
1792 Pcs |
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Hydrate and Alumina |
1500000 |
1307323 |
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Electricity |
1109.2 MW |
9314 MU |
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Electricity (Co-generation) |
248.8*** MU |
1508 MU |
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Continuous Cast Copper Rods (CCR) |
142200**** |
147220 |
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Copper cathodes |
500000 |
333360 |
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Sulphuric Acid |
1670000 |
1042799 |
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Phosphoric Acid |
180000 |
85187 |
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DAP and complexes |
400000 |
182378 |
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Gold |
15 |
9.116 |
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Silver |
150 |
44.856 |
The Installed Capacity is as certified by the Management and license capacity is not given as licensing is not applicable.
* Installed capacity of Hirakud Smelter increased.
** Operation at Wheel Plant, Silvassa discontinued.
*** Installed capacity of Renukoot increased.
**** Installed capacity of Dahej increased.
# Includes 7 T (Previous Year 64 T) converted from outside party, 3,618 T (Previous year, 2,753 T) being production out of customers’ material and 21,461
(Previous year 30,438 T) transferred for captive consumption.
@ Include 1 T (Previous year 23 T) converted from outside party and 67 T (Previous year 81 T) transferred for captive consumption.
Alumina includes 1,053,571 T (1,017,211 T) transferred for own consumption/ further processing.
$ Includes 0 T (previous year 191 T ) being production out of customers material / transferred for own consumption/ further processing.
Production of CCR, Copper cathodes, Sulphuric acid, and Phosphoric acid include 1,182 T, 148,424 T, 251,654 T and 85,187 T (Previous year 178 T, 150,444 T, 260,448 T and 80,245 T) respectively which have been captively consumed / to be consumed.
During the year production and standardization loss of DAP & complexes is 302 T (Previous Year is 336 T).
Previous year figures have been regrouped / rearranged wherever necessary.
GENERAL INFORMATION
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Customers : |
End users and
OEM’s |
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No. of Employees : |
12000
(Approximately) (in office + in factory + in branches) |
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Bankers : |
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Facility: |
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Banking
Relations : |
Good |
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Auditors : |
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Name : |
Singhi and Company Chartered Accountant |
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Cost Auditors: |
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Name : |
R. Nanabhoy and Company Chartered Accountant |
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Address : |
Mumbai |
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Name : |
Mani and Company Chartered Accountant |
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Address : |
Kolkata |
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Joint
Ventures: |
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Group Companies
: |
Associates/Subsidiaries
: v Aditya Birla
Minerals Limited v Birla (Nifty)
Pty Limited v Birla
Maroochydore Pty Limited v Birla Mt Gordon
Pty Limited v Birla Resources
Pty Limited v v Aditya Birla
Chemicals ( v Hindalco - Almex
Aerospace Limited v Indal Exports
Limited v Lucknow Finance
Company Limited v Minerals and
Minerals Limited v Renuka
Investments and Finance Limited v Renukeshwar
Investments and Finance Limited v Suvas Holdings
Limited v Utkal Alumina
International Limited v East Coast
Bauxite Mining Company Private Limited v Tubed Coal Mines
Limited v A V Minerals ( v A V Metals Inc. v A V Aluminum
Inc. v HAAL ( v Novelis Inc. v Novelis Belgique
SA v Novelis Benelux
NV v Albrasilis -
Aluminio do Brasil Industria e Commercia Limited v Novelis do
Brasil Limited v 4260848 Canada
Inc. v 4260856 Canada
Inc. v Novelis Cast
House Technology Limited v Novelis No. 1
Limited Partnership v Novelis Foil v Novelis Lamines v Novelis PAE SAS v Novelis
Aluminium Beteiligungs GmbH v Novelis
Deutschland GmbH v Novelis
Aluminium Holding Company v Novelis Italia
SpA v Novelis
Luxembourg SA v Alcom Nikkei
Specialty Coatings Sdn Berhad v
40) Aluminium Company of v Al Dotcom Sdn
Berhad v Novelis ( v Novelis de
Mexico SA de CV v Novelis Korea
Limited v Novelis v Novelis AG v Novelis
Switzerland SA v Novelis
Technology AG v Novelis
Automotive UK Limited v Novelis Europe
Holdings Limited v Novelis UK
Limited v Aluminium
Upstream Holdings LLC ( v Eurofoil, Inc. ( v Logan Aluminium
Inc. ( v Novelis
Corporation ( v Novelis Brand
LLC ( v Novelis PAE Corp
( v Novelis South v Novelis Madeira,
Unipessoal, Limited v
Novelis Services Limited. |
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Trust of the
Company |
Trident Trust |
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Joint Ventures |
v
IDEA Cellular Limited.
(up to 31st December, 2008) v
Hydromine Global
Minerals GMBH Limited v
Mahan Coal Limited |
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Associates of
the Company |
v Aditya Birla Science and Technology Company Limited v Consorcio Candonga v France Aluminium Recyclage SA v Aluminium Norf GmbH v Deutsche Aluminium Verpackung Recycling GmbH v
Mini MRF LLC ( v
IDEA Cellular Limited (w.e.f. 1st January,
2009) |
CAPITAL STRUCTURE
As on 31.03.2010
Authorised Capital:
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
2100000000 |
Equity Shares |
Re.1/- each |
Rs.2100.000
Millions |
|
25000000 |
Redeemable
Cumulative Preference Shares |
Re.2/-each |
Rs.50.000
Millions |
|
|
Total |
|
Rs.2150.000 Millions |
Issued Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
1914727460 |
Equity Shares of Re.1/- each |
Re.1/- each |
Rs.1914.700
Millions |
|
-- |
6% Redeemable Cumulative Preference Shares |
Re.2/- each |
-- |
|
|
Total |
|
Rs.1914.700
Millions |
Subscribed and Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
1914008691 |
Equity Shares fully paid up |
Re.1/- each |
Rs.1914.000
Millions |
|
546249 |
Less: Face Value of Shares Forfeited |
|
Rs.0.500 Million |
|
|
Add: Forfeited Shares Accountant |
|
Rs.0.200 Million |
|
|
Less: Calls – in – Arrears |
|
-- |
|
|
|
|
Rs.1913.700 Millions |
|
-- |
6% Redeemable Cumulative Preference Shares |
Re.2/-
each |
-- |
|
|
Total: |
|
Rs.1913.700
Millions |
Notes:
- Subscribed
and Paid-up Equity Share Capital include:
(i) 491,766,770 (Previous year 491,766,770) Equity Shares of Re. 1/- each fully paid-up allotted as fully paidup
Bonus Shares by Capitalisation of General Reserve and Capital Redemption Reserve.
(ii) 6,000,000 (Previous year 6,000,000) Equity Shares of Re. 1/- each fully paid-up allotted pursuant to a
contract for consideration other than cash.
(iii) 187,678,350 (Previous year 187,678,350) Equity Shares of Re. 1/- each fully paid-up allotted to the share
holders of erstwhile Indo Gulf Corporation Limited pursuant to the Scheme of Arrangement without payment
being received in cash.
(iv) 2,995,220 (Previous year 2,995,220) Equity Shares of Re. 1/- each fully paid-up allotted to the share holders
of erstwhile Indian Aluminium Company, Limited pursuant to the Scheme of Arrangement without payment
being received in cash.
(v) 376 (Previous year 376) Equity Shares of Re. 1/- each fully paid-up allotted to the share holders of erstwhile
Indian Aluminium Company, Limited pursuant to the Scheme of Amalgamation without payment being
received in cash.
2. Subscribed and Paid-up Preference Share Capital
includes:
(i) 2,032,734 6% Redeemable Cumulative Preference Shares of Rs. 2/- each fully paid-up allotted during last year to the share holders of erstwhile Indian Aluminium Company, Limited pursuant to the Scheme of Amalgamation without payment being received in cash has been redeemed on 1st April, 2009.
.
FINANCIAL DATA
[All figures are
in Rupees Millions]
Expected Sales (2010-2011) : Rs. 200000.000 Millions
ABRIDGED BALANCE SHEET
|
SOURCES OF FUNDS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
|
SHAREHOLDERS
FUNDS |
|
|
|
|
|
1] Share Capital |
1913.700 |
1704.600 |
1226.500 |
|
|
2] Share Warrants |
0.000 |
0.000 |
1391.000 |
|
|
3] Reserves & Surplus |
277156.100 |
235878.600 |
171715.300 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
5] Employee Stock Exchange |
39.900 |
0.000 |
21.300 |
|
|
6] Share Capital Suspense |
0.000 |
0.000 |
4.100 |
|
|
NETWORTH |
279109.700 |
237583.200 |
174358.200 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
51539.000 |
57132.300 |
62054.200 |
|
|
2] Unsecured
Loans |
12030.000 |
26110.600 |
21231.600 |
|
|
TOTAL BORROWING |
63569.000 |
83242.900 |
83285.800 |
|
|
DEFERRED TAX
LIABILITIES |
13664.400 |
14106.700 |
13236.700 |
|
|
|
|
|
|
|
|
TOTAL |
356343.100 |
334932.800 |
270880.700 |
|
|
|
|
|
|
|
|
APPLICATION
OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED
ASSETS [Net Block] |
77348.200 |
78869.700 |
78093.300 |
|
|
Capital
work-in-progress |
37027.900 |
13896.300 |
11198.700 |
|
|
|
|
|
|
|
|
INVESTMENT |
214808.300 |
191488.400 |
141079.900 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS,
LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
59214.100 |
40701.400 |
50979.100 |
|
|
Sundry
Debtors |
13118.700 |
12012.200 |
15650.200 |
|
|
Cash
& Bank Balances |
1402.100 |
8437.200 |
1469.800 |
|
|
Other
Current Assets |
534.300 |
517.800 |
623.000 |
|
|
Loans
& Advances |
14373.700 |
15730.500 |
9794.600 |
|
Total Current Assets |
88642.900 |
77399.100 |
78516.700 |
|
|
Less:
CURRENT LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry
Creditors |
29662.300 |
16139.800 |
20386.600 |
|
|
Other
Liabilities |
24607.000 |
2549.300 |
8561.200 |
|
|
Provisions |
7214.900 |
8031.600 |
9060.100 |
|
Total Current Liabilities |
61484.200 |
26720.700 |
38007.900 |
|
|
Net Current Assets |
27158.700 |
50678.400 |
40508.800 |
|
|
|
|
|
|
|
|
MISCELLANEOUS
EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
356343.100 |
334932.800 |
270880.700 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
195362.800 |
182196.500 |
192010.270 |
|
|
|
Other Income |
2598.500 |
6366.500 |
4929.370 |
|
|
|
TOTAL (A) |
197961.300 |
188563.000 |
196939.640 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
(Increase) / Decrease in Stocks |
(7552.500) |
5205.800 |
(1370.260) |
|
|
|
Goods
Purchased |
719.900 |
1130.400 |
925.180 |
|
|
|
Other Operating Expenses |
172696.200 |
145501.600 |
158444.270 |
|
|
|
Impairment |
(41.500) |
9.300 |
0.000 |
|
|
|
TOTAL (B) |
165822.100 |
151847.100 |
157999.190 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
32139.200 |
36715.900 |
38940.450 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
2780.000 |
3369.300 |
2806.300 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
29359.200 |
33346.600 |
36134.150 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
6713.600 |
6443.400 |
5878.090 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
22645.600 |
26903.200 |
30256.060 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
3489.300 |
4600.500 |
1646.670 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
19156.300 |
22302.700 |
28609.390 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
3000.000 |
3000.000 |
NA |
|
|
|
|
|
|
|
|
|
Add |
Transfer
from Debenture Redemption Reserve |
875.000 |
0.000 |
NA |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
17019.100 |
19562.300 |
NA |
|
|
|
Dividend |
429.000 |
390.200 |
NA |
|
|
|
Tax on Dividend |
2583.200 |
2295.800 |
NA |
|
|
|
Other Reserves |
0.000 |
54.300 |
NA |
|
|
BALANCE CARRIED
TO THE B/S |
3000.000 |
3000.000 |
NA |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN FOREIGN
CURRENCY |
|
|
|
|
|
|
|
Export
of Goods on FOB |
NA |
51481.800 |
64342.600 |
|
|
|
Others |
NA |
62.200 |
07.400 |
|
|
TOTAL EARNINGS |
NA |
51544.000 |
64350.000 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw
Materials |
115214.200 |
79365.600 |
|
|
|
|
Coal |
1369.700 |
2280.400 |
1596.500 |
|
|
|
Components
and Spare Parts |
2423.600 |
640.500 |
1329.100 |
|
|
|
Capital
Goods |
890.100 |
788.300 |
1234.700 |
|
|
|
Trading
Goods |
719.900 |
1126.300 |
905.000 |
|
|
|
Furnace
Oil |
0.000 |
305.000 |
63.100 |
|
|
TOTAL IMPORTS |
120617.500 |
84506.100 |
5128.400 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
10.82 |
14.82 |
-- |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2010 (1st
Quarter) |
30.09.2010 (2nd
Quarter) |
31.12.2010 (3rd
Quarter) |
|
Net Sales |
51782.500 |
58599.400 |
59746.100 |
|
Total Expenditure |
43457.900 |
51615.900 |
52344.900 |
|
PBIDT (Excl OI) |
8324.600 |
6983.500 |
7401.200 |
|
Other Income |
689.200 |
821.000 |
606.100 |
|
Operating Profit |
9013.800 |
7804.500 |
8007.300 |
|
Interest |
593.300 |
526.300 |
516.000 |
|
Exceptional Items |
0.000 |
0.000 |
0.000 |
|
PBDT |
8420.500 |
7278.200 |
7491.300 |
|
Depreciation |
1690.900 |
1717.700 |
1706.500 |
|
Profit Before Tax |
6729.600 |
5560.500 |
5784.800 |
|
Tax |
1385.600 |
1222.400 |
1181.400 |
|
Provisions and contingencies |
0.000 |
0.000 |
0.000 |
|
Profit After Tax |
5344.000 |
4338.100 |
4603.400 |
|
Extraordinary Items |
0.000 |
0.000 |
0.000 |
|
Prior Period Expenses |
0.000 |
0.000 |
0.000 |
|
Other Adjustments |
0.000 |
0.000 |
0.000 |
|
Net Profit |
5344.000 |
4338.100 |
4603.400 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2010 |
31.03.2009 |
31.03.2008 |
|
PAT / Total Income |
(%) |
9.67
|
11.83
|
14.53 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
11.59
|
14.77
|
15.76 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
13.64
|
53.09
|
19.31 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.08
|
0.11
|
0.17 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.44
|
0.46
|
0.64 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.44
|
2.90
|
2.06 |
LOCAL AGENCY FURTHER INFORMATION
Sundry Creditors Details
|
Particulars |
31.03.2010 (Rs. In Millions) |
31.03.2009 (Rs. In Millions) |
31.03.2008 (Rs. In Millions) |
|
Sundry Creditors |
29662.300 |
16139.800 |
20386.600 |
HISTORY
The company the metals flagship company of the Aditya Birla Group, is an
industry leader in aluminium and copper. A metals powerhouse with a
consolidated turnover in excess of US$ 14 billion, Hindalco is the world's
largest aluminium rolling company and one of the biggest producers of primary
aluminium in
Established in 1958, the company commissioned its aluminium facility at
Renukoot in Eastern U.P. in 1962. Later acquisitions and mergers, with Indal,
Birla Copper and the Nifty and Mt.Gordon copper mines in
In 2007, the acquisition of Novelis Inc. a world leader in aluminium rolling
and can recycling, marked a significant milestone in the history of the
aluminium industry in
FINANCIAL PERFORMANCE
The Company’s Consolidated Revenue crossed USD 12.8 Billion mark during the year. The consolidated EBIDTA was at USD 2.1 Billion i.e. Rs.100690.000 Millions. Business Performance is amongst the best ever with highest net profit. Overall results of the Company clearly reflect derisked business portfolio in terms of geographic and roduct mix.
STANDALONE RESULTS
For the year ended 31 March 2010, net sales at Rs.195360.000 millions were higher by 7%. The highest ever metal volume, better product and geographic mix, despite subdued commodity prices helped improve the company’s performance. The superior operational performance in terms of highest ever metal production and substantial cost savings on improved efficiencies were negated by adverse macro-economic factors, which were pronounced in both the businesses.
In the Aluminium Business, lower Rupee-LME eroded profit by around Rs.7500.000 millions. Additionally, Rs.1000.000 millions was lost on account of the higher coal cost at Renusagar Power. Copper Business, which benefitted from higher contracted TcRc (Treatment charges and Refining charges), lost Rs.7500.000 millions on lower by-product credit, in terms of sulphuric acid realisation and lower fertiliser subsidy. Against this backdrop, the performance of both the Businesses was satisfactory. Other income at Rs.2600.000 millions was lower by Rs.3770.000 millions, on account of low treasury corpus, post repayment of bridge loan in November 2008, which was taken for Novelis acquisition and for higher project spending.
Abundant liquidity kept short-term rates low. This also affected yields on the company’s investments which are mostly in liquid plans. It also reduced the cost of working capital borrowing. As a result, the interest and financing
charges also reduced from Rs.3370.00 millions in FY09 to Rs.2780.000 millions in FY10.
Arising from the announcement of the Institute of Chartered Accountants of India dated 29th March, 2008 on Accounting for Derivatives, the Company has decided for early adoption of Accounting Standard (AS) 30 on Financial Instruments : Recognition and Measurement, in so far as it relates to derivative accounting, from 1st April, 2009. Accordingly, net loss arising on fair valuation of outstanding derivatives as on 01st April, 2009 amounting to Rs. 2305.800 millions (net of deferred tax of Rs. 1187.300 millions) has been adjusted against General Reserves following transitional provisions. Accounting for all derivatives from 1st April, 2009 have been done as prescribed under the AS. As a result, net gain / (loss) of Rs. (2361.20) millions and Rs. 1677.500 millions & Rs. 2460.900 millions for the year ended 31st March, 2010 have been included under Sales and Raw Materials Consumed & Other Expenses (in Manufacturing and Other Expenses), respectively, with consequential impact on profit for the year ended 31st March, 2010. The figures of the current year in respect of above items are, therefore, not comparable with those of the previous year.
BUSINESS OVERVIEW:
FY 10 was a remarkable year on various counts. Today, as one looks back at the strong recovery in the aftermath of an unprecedented sanguinary spell that befell us towards the second half of FY09, it appears to be a far better year than FY09. After reaching its nadir in March 09, the commodity prices have recovered and the situation appears to be far better han it was around the same time last year.
And yet, if one compares full year FY10 with FY09, in FY09 average commodity prices were almost the same or were higher than FY10 averages, a fact overlooked by many. This also explains the velocity of decline and recovery, of commodity prices; a truly amazing phenomenon.
Equally intriguing was the sharp fall in demand and subsequent demand recovery initially in the wake of Government’s stimulus measures and later on account of general improvement in the global demand, primarily led by the emerging markets.
Consolidated sales were Rs.607220.000 millions in FY10 as compared with Rs.659630.000 millions in FY09. Revenues were lower mainly due to lower aluminium prices and softness in the Company’s end-markets in the first half of the year, especially for Novelis. Further, change in the status of Idea Cellular Ltd. from Joint Venture to Associatew.e.f from 1 st Jan 2009 for the purpose of consolidation, also resulted in proportionate revenue from Idea not being included in the consolidated revenue.The PBIDTA stood at Rs.100690.000 Millions as compared with Rs.36610.000 Millions in the previous year. This includes USD 578 million of unrealized gains consisting of USD 504 million reversal of previously recognized losses upon settlement of derivatives and USD 74 million of unrealized gains relating to mark to market adjustments on metal and currency derivatives at Novelis.
Aluminium business revenue fell by 11% to Rs.480910.000 millions mainly due to lower LME; and lower demand in first half of the year. Earning before Interest turned around from a loss of Rs.4250.000 millions to a profit of Rs.59980.000millions. This is significantly attributable to the remarkable results of Novelis.
The performance of the Aluminium business segment of standalone Hindalco during FY10 was impacted due to lower average LME.
Average LME was lower by around 16% than the previous year. The demand for downstream value added products improved smartly in the second half and the sales volumes for the year were higher by 21% compared to previous year.
OPERATIONAL
HIGHLIGHTS:
1. Highest ever aluminium production.
2. Highest ever downstream value added production leading to improved product mix.
3. Significantly higher sales in more lucrative domestic market.
4. Continuous reduction in conversion cost despite rising input cost pressures.
They continued producing more metal both through asset sweating and brownfield expansion of the Hirakud smelter and de-bottlenecking at Renukoot. They produced 555 KT of hot metal against 523 KT in the previous year. The Company recorded highest ever primary aluminium production in this year . The turnover in the aluminium business declined by 8% to Rs. 70010.000 millions vis-à-vis Rs. 76040.000 millions in the corresponding period in the previous year with decline in LME, even though the decline was partly offset through higher volumes.
To mitigate the impact of sharp fall in realizations several cost control initiatives were successfully adopted. The increased proportion of Hirakud metal in the basket also enabled us to reduce blended cost of production.
The EBIT margin of the Aluminium business is amongst the highest relative to domestic and global peers which underlines the strategic thrust and commitment to combine cost leadership and portfolio de-risking. As a result, the EBIT margin is relatively less impacted by LME compared to pure play aluminium companies.
FY10 was perhaps one of the most challenging years for Copper smelters worldwide. The business witnessed extreme price volatility in the aftermath of the economic meltdown, compounded by acute tightness in the concentrate market and unviable spot TCRC levels. While the benchmark TCRC’s were a healthy 75/7.5, the spot TCRC’s plummeted from a high of 90/9 in Jan, 09 to near zero by Q310 and remained well below the cash costs of most smelters for significant part of the year.
The Copper business significantly improved its underlying operating performance despite tightness in the concentrate market and escalating input costs. Copper business revenue increased by 18% to Rs. 125420.000 millions and EBIT doubled from Rs. 3790.000 millions to Rs. 6600.000 millions.
NOVELIS
Novelis witnessed a tremendous turnaround in the midst of challenging circumstances. In an economy that was still emerging from recession Novelis reported record results. Record adjusted EBITDA, record liquidity and record free cash flow. Novelis achieved these record results despite a 2% decrease in shipments Y-o-Y driven by soft market conditions in the first half of the year. Novelis’ sales declined due to decrease in the average LME prices and 2% lower shipments.
Adjusted EBITDA increased by 55% Y-o-Y, reaching USD 754 Million. This was achieved on the back of price increases negotiated in specific contracts across all regions and costout and restructuring initiatives that the company identified and implemented throughout the year.
The Company also saw a dramatic improvement in liquidity over the past year, liquidity surpassed USD 1 Billion driven by strong operational cash flow, the bond issuance and increased gross borrowing capacity under theABL. Free cash flow went from a negative USD 352 Million in FY09 to a positive USD 355 Million in FY10. This was a direct result of stronger performance, working capital management and controlled capex levels.
The IT subsidiary of Novelis in Pune, Novelis India Infotech Limited is now up and running. It is now catering to some of the IT and ERP requirements of Novelis globally.
Effective, 1 st January, 2010, Novelis is no longer impacted by can price ceilings. In terms of continued cost savings, Novelis is taking a series of steps to streamline and optimise the manufacturing operations in mature markets.
In response to the growing demand for its products in South
America, the company is undertaking a major expansion in
ADITYA BIRLA MINERALS
Aditya Birla Minerals Limited, the Company’s Australian Subsidiary, reported Profit after Tax of AUD 61.4 Million as against a loss of AUD 76.0 Million in the previous year. Sustained cost management resulted in turnaround in
financial performance. The production was however; lower
mainly due to loss of production of Copper in Concentrate at
increase in Nifty’s production of Copper in Concentrate.
PROJECTS
The projects continue to follow the strategic plan which
they have set for ourselves. The benefits of brownfield expansions and earlier
inorganic acquisitions have been the major factors which helped us tide over
the challenging environment in FY10. They are working on five
BUSINESS
RECONSTRUCTION RESERVE
Last year the Company formulated a scheme of financial restructuring to deal with various extraordinary costs associated with its organic and inorganic growth plan. The recent economic downturn particularly in the commodity space is also expected to result in impairment / diminution in value of certain assets/ investments.
Accordingly, as per a Scheme of Arrangement under Sections
391 to 394 of the Companies Act 1956 (“the Scheme”) between the Company and its
equity shareholders approved by the High Court of judicature of Bombay, a
separate reserve account titled as Business Reconstruction Reserve (“BRR”) has
been created by transferring balance standing to the credit of Securities
Premium Account of the Company for adjustment of certain expenses as prescribed
therein. This year no adjustment was made pertaining to standalone accounts in
this reserve and Rs. 3040.000 millions relating to interest and finance charges
on loan taken by AV Minerals (
CORPORATE
The standalone basic and diluted Earning per Share was at Rs.10.8 per share FY10 as compared with Rs.14.8 per share in FY09.
BUSINESS PERFORMANCE
REVIEW:
ALUMINIUM BUSINESS
ALUMINIUM INDUSTRY
REVIEW
Global economies recovered after an unprecedented sharp fall in FY09. The recovery was equally spectacular but fraught with uncertainty and the average aluminium prices remained lower than the FY09 averages. The Indian economy showed its resilience in FY09 and staged a sharp recovery albeit on the back of generous stimulus packages by the Government. In the aftermath of FY09 meltdown and in the midst of uncertainty surrounding this
recovery, many global majors were forced to adapt to the dynamic conditions in an ad hoc manner and resorted to reactive actions in response to the challenges faced such as curtailing production, closing facilities and then
re-starting some of these facilities when the situation improved.
The company on the other hand approached these adversities
in a much steadier and controlled manner and was able to weather the storm much
better. Not only did it perform redibly on the operational front but also
nsured smooth and steady progress on the arious
DEMAND AND MARKET:
In CY 2009, the world aluminium consumption stood at around 34 Mn tonnes, a sharp decline of over 8% from around 37.5 Mn tones consumption in CY 2008. The CY09 production stood at 37.7 Mn tonnes against production of 40 Mn tonnes in CY 08.
After an abysmal first quarter, the growth rebounded in FY10 reaching around 36.3 Mn tonnes, a growth of around 2.5%.
In FY10 LME aluminium prices staged a remarkable recovery to around USD 2,000 levels after touching lows of sub USD1400 in March 2009.
The depreciating rupee helped domestic aluminium producers partially as the prices are dollar denominated. The prices continued to rise even as inventory levels remained at their historic highs. This was the result of tightness in the physical market, with most inventories tied up at various ware houses under financing deals.
Aluminium continued to remain in contango taking more and more aluminium outside the physical market as borrowing costs remain low and warehouses rent continued to be attractive.
Globally, Aluminium production increased as the producers
restarted their capacities with the smart recovery in the aluminium LME. As a
result the global markets continued to be in surplus and global inventory
increased to historical peaks. The primary aluminium production for the year
was around 40 Mn tonnes.
The cost of production of aluminium increased as input costs such as alumina and power surged. Alumina costs increased as the aluminium prices recovered and bauxite quality deteriorated. For most producers power costs
increased with sharp rise in coal/energy prices. The cost of other inputs such as CPC coke and anodes also increased in line with recovery in the crude prices.
OPERATIONAL REVIEW
On this backdrop, the Company’s performance was commendable and its performance was amongst the best erformance in the industry. The aluminium business operational performance was indeed exceptional and recorded highest ever production of aluminium metal surpassing the record it achieved last year.
ALUMINA
They increased alumina production by 6% to 1.3 Mn tonnes primarily through production ramp up post expansion at Muri. They increased the higher paying domestic sale of specials by 4%. Overall alumina sales volumes however, were almost flat on account of higher captive consumption.
PRIMARY METAL
Primary aluminium production increased to 555,404 MT up 6% over the previous year. This increase in production growth was possible through brownfield expansion of Hirakud smelter facility that led to 16% production growth from 134,301 Mt to 156,206 Mt and through continued efforts to debottleneck the Renukoot capacity, which yielded around 10,000 tonnes of incremental production. Aluminium sales volumes increased in line with the production increase. However it was sales of value added products such as FRP and Extrusions that improved sharply.
WIRE RODS
Wire rods production grew by over 23% from 74,968 MT in FY
09 to 91,903
VALUE ADDED PRODUCTS
(VAP)
This remains the key focus area of the company to enhance profitability. This segment saw a sharp rebound with improved economic scenario. The VAP (i.e. flat rolled products, extrusions and foils) volumes in tonnage improved significantly compared to that of last year. The overall revenue though remained depressed on account of lower aluminium LME. The markup in the down stream business has shown a continuous improvement over the years with continuous improvement in product mix as well as geographical mix.
FLAT ROLLED PRODUCTS
The FRP production increased to 205,265 MT, in line with the increasing domestic demand, an increase of 13% over previous years. The export demand though remained subdued.
EXTRUSIONS
Extrusion segment demand also improved as the economy recovered. An improvement in the fortunes of housing and automobile sectors resulted in a demand increase for extruded products. Extrusion production was higher at38,909 MT in FY10 as compared with 35,895 MT in FY09. Extrusions sales volume increased 9% in FY10.
FINANCIAL PERFORMANCE
The turnover of the aluminium domestic business declined by 8% to Rs. 70010.000 Millions vis-à-vis Rs. 76040.000 millions in the previous year, inspite of the highest ever metal volumes, as average LME for the year was 16% lower than the previous year.
Earnings before interest and taxes (EBIT) declined by 18% to Rs. 17670.000 Millions due to pressure on realizations and the cost push. The costs push, was the result of increase in crude prices leading to some increase in crude derivative prices such as CP coke and fuel oil. Coal prices also increased sharply. Aluminium producers acrossthe globe experienced pressure on EBIT margins The decline in the case of the Company was amongst the lowest in the industry. This was possible primarily on account of higher production, sales volumes and superior product and geographic mix as discussed earlier.
The other cost management measures that helped in containing the fall in EBIT were :
- Improvement in operational efficiency in Power consumption, Carbon consumption etc.
- Cost effective sourcing of key Raw materials.
The sustainability of the company’s profitability is reflected in healthy EBIT margins of 25% despite all the adversities.
ALUMINIUM OUTLOOK
In 2010, the global aluminium demand is expected to recover back to almost 39 Mn tonnes an improvement of almost 13% over 2009. The Chinese demand is expected to rise by almost 18% after a relatively modest increase
in 2009. The
Over the medium term, thrust on power sector spending will spur the aluminium demand. Aluminium production is expected to increase in line with the demand. The market surplus is going to continue for a while. With unprecedented demand destruction towards later part of FY2009, the prices of aluminium had declined very sharply by over 50% in less than 4 months. The recovery has also been strong. As a result, many smelters that had curtailed production are again back in action. In addition some new smelters are on the verge of delivering. The cost push has been felt in the recent times with rise in crude prices from the recent highs. Most input costs such as fuel oil, coal tar pitch have increased along with the freight costs.
The prices are expected to continue to stay range bound over the short term with a large inventory overhang. Aluminium inventories across the globe are near all time high. But most of these inventories are reportedly bound in financing deals and are not expected to flood the market. The long term fundamentals are strong and the surplus is expected to reduce significantly by FY 10 end.
BUSINESS OUTLOOK
The Company has demonstrated its mettle in the wake of severe macroeconomic adversities. The ferocity and the velocity of the turmoil surprised the industry. But by leveraging its fundamental strengths and through robust business model the Company has emerged stronger from the meltdown.
The Company has adopted a consistent strategy to achieve
global size and scale through the acquisition of Novelis. The de-risked
business model of Novelis, where LME is a pass through, its robust product
portfolio with over 50% going into manufacture of beverage cans and strong
presence in emerging markets has shown its strength in possibly worst of the
times. This business complements the Company’s ongoing brownfield and
PROGRESS.
UTKAL ALUMINA
PROJECT:
Construction of 1.5 Mio TPA Alumina refinery along with a 90 MW captive cogen plant is in full swing. The output from Utkal would be sufficient to feed alumina to the Mahan and the Aditya smelters. Engineering for Refinery and captive cogen plant is nearing completion. Contractors are working at site for civil & structural work and have mobilized more than 5000 people at site. Piling is 85% complete, fabrication and concreting are around 35% complete. Major equipment like Boilers, Evaporators & Turbines have started arriving at site. The erection and structural work for various equipments is in progress. Orders for all the long delivery equipments placed. Around 82% of the project cost has already been committed.
The project team has estimated a total cost of Rs.56000.000 millions without financing cost. The project commissioning is projected in Q2 FY12.
Sanctioned credit approvals from a consortium of banks for the entire debt requirement of the project have been obtained. The Common loan agreement was signed in July, 2010 and the drawdown is expected soon.
MAHAN ALUMINIUM
PROJECT:
An 359 ktpa, Aluminium Smelter of capacity along with a 900 MW captive power plant is coming up in Bargwan, Madhya Pradesh.
All major approvals are in place and site activities are on track. Major contractors have mobilized about 10,000 people at site. Three out of the six boilers & electrostatic precipitator foundations are complete. The powerhouse foundation work is in progress. Two chimney rafts are complete. The erection of the engineering structure for boilers is in progress. Around 82% of the total project cost has been committed. The project team has estimated a
total cost of Rs.92000.000 millions without financing cost. The project is expected to be commissioned in Q2FY12.
The Aditya Aluminium project: A 359 ktpa, Aluminium smelter along with a 900 MW captive power plant, identical to the Mahan Project, is coming up in Orissa.
All major approvals are in place. Critical equipment orders have been placed for both the smelter and the power plant. The site activities like area grading and boundary wall are on.
Around 59% of the total project cost has been committed. The project team has estimated a total cost of Rs.92000.000 millions without the financing cost. The project commissioning is slated in Q3 FY12.
The Aditya Refinery
Project:
A 1.5 Mio TPA Alumina Refinery along with a 90 MW cogen plant, replica of the Utkal Alumina refinery is coming up in Orissa. The cost estimate in the order of magnitude is Rs. 60000.000 millions without financing cost. It is planned for commissioning in Q1 FY14.
THE JHARKHAND
ALUMINIUM PROJECT:
359 ktpa, Aluminium smelter along with a 900 MW captive power plant is coming up in Sonahatu, Jharkhand. The land acquisition process has already begun. The process for obtaining environmental clearance has begun. To that effect, a presentation has been made to the MOEF expert committee. The Tubed Coal Mine has been allotted to the project jointly with Tata Power.
This project seeks to replicate the Aditya / Mahan smelter. The cost estimate in the order of magnitude is Rs.100000.000 millions without financing cost. It is planned for commissioning in Q1 FY14.
The blueprint for a suitable financing plan for the projects is in place. These projects will significantly enhance the scale of operations of the company. These will further improve the cost competitiveness of the Company and will firmly establish it as one of the lowest cost global alumina and aluminium producers.
To debottleneck and increase capacity, primarily in South
America and
The expansion is expected to be completed by late 2012.
COPPER BUSINESS
REVIEW
INDUSTRY REVIEW
Global refined copper consumption declined second year on the trot in CY 2009. In last 2 years, the decline has been from 18 Mn tones (CY 2007) to 16.7 Mn tonnes (CY 2009). The decline in CY 09 though was much lower than earlier anticipated. The production however, continued to remain reasonably strong declining to only 18 Mn tonnes resulting into a surplus.
However,
days due to increased risk aversion.
FY10 was perhaps one of the most challenging years for Copper smelters worldwide. The business witnessed extreme price volatility in the aftermath of the economic meltdown, compounded by acute tightness in the concentrate market and unviable spot TcRclevels. While the benchmark TcRc was a healthy 75/7.5, the spot TcRc’s plummeted from a high of 90/9 in Jan, 09 to near zero by Q3,09 and remained well below the cash costs of smelters for most part of the year. The situation got further aggravated by precipitous fall in sulphuric acid prices from a peak of $350/t in 2008 to - $25/t fob in FH- 2009 and sharp drop in fertilizer subsidies.
COMPANY PERFORMANCE:
The Copper business performed well despite adverse macroeconomic environment. The company recorded creditable production performance notwithstanding bi-annual shutdowns. The Company also managed its market mix well to improve overall copper realizations despite lower volumes. Globally many Smelters were forced to cut back their output on account of Sulphuric acid evacuation problems. Global smelter capacity utilization, as a result, dropped by 7-8% during the year, whereas the capacity utilization increased by 9% during the same period.
The Company proactively seized a larger share of the shrinking pie of sulphuric acid demand through innovative supply chain interventions & aggressive pricing, thus not letting the Smelters suffer on this count.
During the year significant improvements were achieved in operating performance. The Company delivered highest ever production of cathode-improvement of 12% over the previous year. DAP volumes too were 7% higher than the pervious year.
The high point of operational performance was dramatic reduction in cost of production through improvement in operational efficiencies and innovative optimization of input energy cost through use of alternative fuels (LNG and
Petcoke). In FY10, the Company delivered 30% reduction in cost of production over the previous year. Today Dahej ranks in top quartile of the Global cost competitiveness.
COPPER OUTLOOK:
The global refined copper demand is expected to increase by
around 5.5% in CY2010. Marginal recovery in western world consumption, with
strong demand from emerging economies notably Asia and
The long term Tc Rc contracts for the year were significantly lower than CY2009 due to constrained mine supply and strong demand for refined copper. The Spot Tc Rcs declined to historical lows driven by tight concentrate availability on account of delays in the expected new mine capacities, rising project costs and associated risk / sociopolitical factors. Higher capital costs, decliningore grades and labour related issues in some of the major copper producing countries are expected to restrict the availability of concentrate and put further pressure on spot Tc Rcs.
Indian refined copper consumption is expected to increase
sharply after a brief pause last year. The annual consumption growth is
expected to be around 9% with strong growth in power, automobile and
manufacturing sector. The long term fundamentals are strong and the copper
consumption is expected to increase with renewed thrust on power sector reforms
and urban housing. The copper consumption in
BUSINESS OUTLOOK
The Company has continued to perform creditably in the challenging times. It continues to make steady progress on the planned growth track. The Company will continue to strive to improve operating efficiencies and reduce conversion costs. The Company’s production flexibility with respect to various value added byproducts will increase the available options for profit and cash flow improvements.
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.44.99 |
|
|
1 |
Rs.73.23 |
|
Euro |
1 |
Rs.62.80 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
8 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
9 |
|
--LIQUIDITY |
1~10 |
9 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
9 |
|
--CREDIT LINES |
1~10 |
8 |
|
--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 |
|
75 |
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.