MIRA
INFORM REPORT
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Report Date : |
25.03.2011 |
IDENTIFICATION DETAILS
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Name : |
HDFC BANK LIMITED |
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Registered Office : |
HDFC Bank House, Senapati
Bapat Marg, Lower Parel, West, Mumbai – 400013, |
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Country : |
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Financials (as on) : |
31.03.2010 |
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Date of Incorporation : |
30.08.1994 |
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Com. Reg. No.: |
11 – 080618 |
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CIN No.: [Company
Identification No.] |
L65920MH1994PLC080618 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
MUMH03189E /
MUMH08037B |
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PAN No.: [Permanent
Account No.] |
AAACH2702H |
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Legal Form : |
It is a Public Limited
Liability Bank. The banks shares are
listed on the Stock Exchanges. |
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Line of Business : |
Corporate Banking Consisting of Working Capital Finance,
Trade Service and Cash Management Treasury. |
RATING & COMMENTS
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MIRA’s Rating : |
Aa (75) |
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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 : |
Large |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is an established and a highly successful commercial bank in the
private sector. Financial position of the bank is good. Fundamentals are
strong and healthy. Trade relations are fair. Payment are regular and as per
commitment. The bank can be considered for any normal business dealings under
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 DENIDED BY
Management non cooperative.
LOCATIONS
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Registered
Office : |
HDFC Bank House,
Senapati Bapat Marg, Lower Parel, Mumbai – 400013, |
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Tel. No.: |
91-22-66521000 |
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Fax No.: |
91-22-24960737 |
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E- Mail : |
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Website : |
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Branches : |
WESTERN ZONE
NORTH ZONE
SOUTH ZONE
EAST ZONE |
DIRECTORS
As On : 30.06.2010
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Name : |
Mr. Jagdish
Capoor |
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Designation : |
Chairman |
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Name : |
Mr. Aditya Puri |
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Designation : |
Managing Director
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Name : |
Mr. Keki Mistry |
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Designation : |
Director |
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Name : |
Mr. Paresh
Sukthankar |
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Designation : |
Executive
Director |
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Name : |
Mrs. Renu Kamad |
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Designation : |
Director |
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Name : |
Mr. Arvind Pande |
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Designation : |
Director |
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Name : |
Mr. Harish Engineer |
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Designation : |
Executive
Director |
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Name : |
Mr. Ashim Samanta |
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Designation : |
Director |
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Name : |
Mr. C M Vasudev |
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Designation : |
Director |
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Name : |
Mr. Gautam Divan |
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Designation : |
Director |
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Name : |
Mr. Pandit
Palande |
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Designation : |
Director |
KEY EXECUTIVES
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Name : |
Mr. Sanjay Dongre |
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Designation : |
Company Secretary |
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Senior Management Team: |
Mr. A Parthasathy Mr. A Rahan Mr. Abhay Aima Mr. Anil Jaggia Mr. Bharat Shah Mr. Bhavesh Zaveri Mr. G. Subramanian Mr. Jimmy Tata Mr. Kaizad Bharucha Mrs. Mandeep Maitra Mr. Navin Puri Mr. Pralay Mondal Mr. Rahul Bhagat Mr. Sashi Jagdishan |
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
Promoters and Promoters Group |
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1. Indian |
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(a) Bodies Corporate |
108643220 |
29.00 |
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(B) Public Shareholding |
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1. Institutions |
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(a) Mutual Funds
/ UTI |
17957910 |
4.69 |
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(b) Financial
Institutions / Banks |
300674 |
0.08 |
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(c) Insurance Companies |
32171589 |
8.40 |
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(d) Foreign Institutional Investors |
136392436 |
35.59 |
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2. Non-Institutions |
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(a) Bodies Corporate |
39500903 |
10.31 |
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(b) Individuals- |
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i. Individual shareholders holding nominal share capital upto Rs.0.100
million |
32819048 |
8.56 |
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ii. Individual shareholders holding nominal share capital upto
Rs.0.100 million |
9724794 |
2.54 |
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( c) Any Other (Specify) |
5690568 |
1.49 |
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Non Resident Indians |
1920985 |
0.50 |
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Overseas corporate Bodies |
92265 |
0.02 |
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Foreign Corporate Bodies |
3673809 |
0.96 |
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Foreign Nationals |
3509 |
-- |
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Shares held by custodians and against which depository receipts have been issued |
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(1) Promoter and Promoter Group |
-- |
-- |
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(2) Public |
81128819 |
17.47 |
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Total |
464329961 |
100.00 |
BUSINESS DETAILS
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Line of Business : |
Corporate Banking Consisting of Working Capital Finance,
Trade Service and Cash Management Treasury. |
GENERAL INFORMATION
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No. of Employees : |
14878 (Approximately) |
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Bankers : |
Reserve Bank of |
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Banking
Relations : |
-- |
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Auditors : |
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Name : |
Haribhakti and Company Chartered Accountant |
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Promoter : |
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Enterprises Under Common Control Of The Promoter : |
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Subsidiaries : |
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Associates : |
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CAPITAL STRUCTURE
As On : 31.03.2010
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
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550000000 |
Equity Shares |
Rs. 10/- each |
Rs. 5500.000 millions |
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Issued, Subscribed & Paid-up Capital :
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No. of Shares |
Type |
Value |
Amount |
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457743272 |
Equity Shares |
Rs. 10/- each |
Rs. 4577.433
millions |
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FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
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CAPITAL AND LIABILILITES |
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Capital |
4577.433 |
4253.841 |
3544.329 |
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Equity Share
Warrants |
0.000 |
4009.158 |
0.000 |
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Reserves and
surplus |
210618.369 |
142209.460 |
111428.076 |
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Employees Stock
Options (Grants) Outstanding |
29.135 |
54.870 |
0.000 |
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Deposits |
1674044.394 |
1428115.800 |
1007685.910 |
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Borrowing |
129156.925 |
91636.374 |
45949.235 |
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Other Liabilities & Provisions |
206159.441 |
162428.229 |
163158.482 |
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TOTAL |
2224585.697 |
1832707.732 |
1331766.032 |
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ASSETS |
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Cash & Balances with Reserve Bank of
|
154832.841 |
135272.112 |
125531.766 |
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Balances with Banks & money at Call
& Short Notice |
144591.147 |
39794.055 |
22251.622 |
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Investments |
586076.161 |
588175.488 |
493935.382 |
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Advances |
1258305.939 |
988830.473 |
634268.934 |
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Fixed Assets |
21228.114 |
17067.290 |
11750.917 |
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Other Assets |
59551.495 |
63568.314 |
44027.411 |
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TOTAL |
2224585.697 |
1832707.732 |
1331766.032 |
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Contingent Liabilities |
4790515.044 |
4059816.885 |
5930080.864 |
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Bills for Collection |
81248.646 |
85522.390 |
69207.148 |
PROFIT & LOSS
ACCOUNT
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|
PARTICULARS |
31.03.2010 |
31.03.2009 |
31.03.2008 |
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I. |
INCOME |
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Interest Earned |
161729.000 |
163322.611 |
101150.087 |
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Other Income |
38076.106 |
32906.035 |
22831.425 |
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TOTAL (A) |
199805.106 |
196228.646 |
123981.512 |
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II. |
EXPENSES |
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Interest Expended |
77862.988 |
89111.044 |
48871.146 |
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Operating Expenses |
57644.827 |
55328.058 |
37456.168 |
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Provisions and
Contingencies |
34810.282 |
29340.152 |
21752.268 |
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TOTAL (B) |
170318.097 |
173779.254 |
108079.582 |
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III. |
PROFIT
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Net Profit for
the Year |
29487.009 |
22449.392 |
15901.930 |
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Profit Brought
Forward |
34555.658 |
25746.345 |
19320.397 |
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IV. |
APPROPRIATIONS |
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Transfer to Statutory Reserve |
7371.752 |
5612.349 |
3975.483 |
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Proposed Dividend |
5492.919 |
4253.841 |
3012.680 |
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Tax on Dividend |
912.305 |
722.940 |
512.005 |
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Dividend Pertaining to Previous year paid
during the year |
9.343 |
5.900 |
0.621 |
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Transfer to General Reserve |
2948.701 |
2244.939 |
1590.193 |
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Transfer to Capital Reserve |
1994.599 |
938.660 |
0.000 |
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Transfer to Investment Reserve Account |
(14.900) |
(138.550) |
385.000 |
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BALANCE CARRIED
TO THE B/S |
45327.948 |
34555.658 |
35222.327 |
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Earnings Per
Share (Rs.) |
67.56 |
52.85 |
46.22 |
|
QUARTERLY RESULTS
(Rs.
In millions)
|
PARTICULARS |
30.06.2010 |
30.09.2010 |
31.12.2010 |
|
Type |
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
|
Interest Earned |
44201.500 |
48100.000 |
52299.600 |
|
Operating Expenses |
15923.100 |
16798.800 |
18318.200 |
|
Operating Profit Before Provision and Contingencies |
17487.100 |
18071.000 |
20726.900 |
|
Provisions and Contingencies |
5550.200 |
4544.800 |
4658.700 |
|
Depreciation |
0.000 |
0.000 |
0.000 |
|
Provision for Taxes |
3819.800 |
4404.800 |
5189.900 |
|
Fringe Benefit Tax |
0.000 |
0.000 |
0.000 |
|
Deferred Tax |
0.000 |
0.000 |
0.000 |
|
Net Profit |
8117.100 |
9121.400 |
10878.300 |
|
Extra –Ordinary Items |
0.000 |
0.000 |
0.000 |
|
Adjusted Profit After Extra-ordinary Items |
8117.100 |
9121.400 |
10878.300 |
LOCAL AGENCY FURTHER INFORMATION
CHANGE PURSUANT TO
RECLASSIFICATION
The Bank posted
total income and net profit of Rs. 199805.000 millions and Rs. 29487.000
millions respectively for the financial year ended March 31, 2010 as against
Rs. 196229.000 millions and Rs. 22450.000 millions respectively in the previous
year.
SUBSIDIARY
COMPANIES
The Bank has two
subsidiaries, HDFC Securities Limited (“HSL”) and HDB Financial Services
Limited (“HDBFS”). HSL is primarily in
the business of providing brokerage services through the internet and other
channels. HDBFS is a non-deposit taking non-bank finance company (“NBFC”), for
the establishment of which the Bank received Reserve Bank of India (“RBI”)
approval during the fiscal year ended March 31, 2008.
In terms of the
approval granted by the Government of India, the provisions contained under
Section 212(1) of the Companies Act, 1956 shall not apply in respect of the
Bank’s subsidiaries. Accordingly, a copy of the balance sheet, profit and loss
account, report of the Board of Directors and the report of the Auditors of HSL
and HDBFS have not been attached to the accounts of the Bank for the year ended
March 31, 2010.
Shareholders who
wish to have a copy of the annual accounts and detailed information on HSL and
HDBFS may write to the Bank for the same. Further, the said documents shall
also be available for inspection by shareholders at the registered offices of
the Bank, HSL and HDBFS.
MANAGEMENT’S
DISCUSSIONS AND ANALYSIS
Macro-economic and
Industry Developments
After witnessing a
significant slowdown in the fiscal year ended March 31, 2009, the Indian
economy bounced back impressively during the last financial year. The inherently
strong domestic consumption combined with both the monetary and fiscal stimuli
measures undertaken by the government and other policy authorities over the
past year helped the economy shrug off the overhang of weak exports and global
headwinds. GDP growth is estimated to be around 7.2% for the fiscal year ended
March 31, 2010 as against 6.7% for the year ended March 31, 2009. While a large
share of growth in the last financial year could be attributed to government
spending, private consumption and investment also picked up quite sharply,
which put to rest any concerns on the sustainability of the domestic recovery.
While government spending was likely to have grown by 8.2% last year, private
consumption growth is expected to have been at around 4.6 % from a low of 1.7%
exhibited in the quarter ended June 30, 2009. Private investment growth is also
expected to have recovered to 5.2% from 4% a year ago.
In terms of the
sectoral composition of growth, the industrial sector was the clear driver of
this recovery, growing by 10% in the last financial year from 2.8% a year ago.
While the revival in industrial growth was led by a pick-up in consumer
durables, other industrial sectors such as basic goods, intermediate goods and
more importantly capital goods also gathered momentum, collectively pointing to
the broad-basing of industrial recovery.
Service sector
growth was dominated by community, social and personal services reflecting
increased government expenditure. However, private services such as trade,
transport and communication gathered pace and are likely to keep the service
sector growth strong through the next financial year. Overall, service sector
growth was estimated at 8.5% in the last fiscal year as against 9.7% a year ago
while private services are estimated to have recovered from a growth rate of
8.4% in the year ended March 31, 2009 to 8.9% in the last fiscal year.
Perhaps the most
visible dimension of the robustness of the ongoing recovery was the fact that
the economy successfully weathered a drought. While the agricultural output is
expected to have contracted by about 0.6% last year, non-agricultural GDP is
slated to have grown by 9% against 7.7% a year ago. Much of this decoupling
between the agricultural and industrial growth was attributable to a more
fundamental diversification of the rural economy away from farming activities
and the increasing role of small scale industry in broadening the rural income
base. Additionally, fiscal support measures such as the National Rural Employment
Guarantee Scheme (NREGS) also played a crucial role in providing a safety net
to small farmers and agricultural workers.
Apart from fiscal
stimulus efforts amounting to nearly 2% of GDP, an accommodative monetary policy
stance also played an important role in supporting economic recovery. Policy
rates were eased by an average of 275-400 basis points (one basis point =
0.01%) while average lending rates of banks fell by close to 275 basis points
since the onset of the crisis. Easy monetary conditions meant that short-term
rates fell sharply. After spiking up to a high of 20% in October 2008, the
overnight call money rates eased to 3-4%, indicating very comfortable domestic
liquidity conditions. Monetary accommodation was especially important in
helping the economy absorb a hefty government borrowing program during the last
fiscal year which ensured that pressure on government bond yields remained
muted.
Despite a decline
in effective lending rates, system credit growth remained subdued over the year
with some signs of a pick-up in the growth rates in the last quarter of the
year. After reaching a system loan growth rate of 17% in the financial year
ended March 31, 2009, credit growth plummeted to 10% in October 2009. Some
recovery in this growth was witnessed on the back of increased demand for term
lending and project financing which resulted in a pick up in credit growth to
16% as at March 2010. Infrastructure funding was a leading area of credit
demand, contributing close to 60% of the incremental credit growth in the last
financial year.
Inflation over the
past year was largely driven by supply-side pressures on account of the drought
and hence substantially confined to agricultural commodity prices. There were
however emerging signs that inflation is getting more broad-based with private
demand playing a role in pushing up prices of manufactured products. In
February 2010 headline WPI inflation moved 9.9% alongside a pick-up in
manufactured goods inflation to 7.4% from a low of -0.2% in July, 2009.
Both merchandise
exports and imports recovered sharply at the end of the third quarter of the
last fiscal year after the record slide seen over the two quarters prior to
that. After falling sharply by 28% in the first half of the fiscal year ended
March 31, 2009, export orders increased by 13% at the end of the third quarter
of the last financial year and by 34.8% in February 2010 driven by strong
demand from both the Chinese and US economies. Domestic imports also rose sharply
over the last few months driven by strong growth in the domestic industrial
sector. In fact, the sharp rebound in the industrial sector resulted in an
increase in non-oil imports, especially capital goods imports. More
importantly, the rise in oil prices in the latter half of the financial year
ended March 31, 2010 pushed up the total imports bill. The trade deficit in the
financial year ended March 31, 2010 is estimated to have widened to USD 129
billion as against USD 118 billion in the previous year.
Recent data
released by the RBI shows that the net invisibles component (software exports,
private transfers, etc.) came in much weaker than expectations in the first
three quarters of the financial year ended March 31, 2010. While private
transfers grew by a relatively sedate 12% in this period, a muted growth in
software exports and a decline in business services exports impacted net
invisibles. Net invisibles were USD 59 billion as compared to USD 70 billion
seen in the same period during the previous year. Going forward, although we do
not expect the weakness in the net invisibles component to persist, we expect
the current account deficit to widen driven primarily by the deterioration in
trade balance.
Even though the
current account deficit increased, the total balance of payments position
remained comfortably placed as capital flows were fairly strong as compared to
those in the prior year. Strong portfolio inflows due to the improvement in
global risk appetite were the major contributors to the strong balance of
payments position. Going forward, we expect the balance of payments position to
remain in surplus this year as fund flows continue to remain strong.
The Indian equity
markets rallied sharply during the last financial year due to the general
improvement in global risk appetite. Global investors went from pricing in a
severe recession to expecting a sharp rebound in the global economy and in the
process pushed most equity markets higher. India ranked amongst the fastest
growing economies in the world and benefited immensely during this phase.
Outlook
The Indian economy
is likely to continue to outperform its global counterparts in the year ahead,
growing by around 8% against an average world output growth of 3.9%. Investment
and capacity expansion will be a crucial link in driving the recovery forward;
buoyant domestic demand should help it absorb headwinds from rising interest
rates and inflation. With private capex and infrastructure spending likely to
gather ground, not only will the ongoing recovery sustain into the next
financial year but will also translate into greater buoyancy in credit growth
and stronger growth prospects for the banking sector in general. Focus on
investment in the next fiscal year is likely to render India an attractive
market that is well positioned to take advantage of both structural and
cyclical gains while its strong domestic base is likely to limit the impact of
external stress on growth dynamics and returns.
Mission and
Business Strategy
The Bank’s mission
is to be “a World Class Indian Bank”, benchmarking itself against international
standards and best practices in terms of product offerings, technology, service
levels, risk management and audit and compliance. The objective is to continue
building sound customer franchises across distinct businesses so as to be a
preferred provider of banking services for target retail and wholesale customer
segments, and to achieve a healthy growth in profitability, consistent with the
Bank’s risk appetite. The Bank is committed to do this while ensuring the
highest levels of ethical standards, professional integrity, corporate
governance and regulatory compliance.
The Bank’s
business strategy emphasizes the following:
- Increase its market share in India’s
expanding banking and financial services industry by following a
disciplined growth strategy focusing on balancing quality and volume
growth while delivering high quality customer service;
- Leverage its technology platform and
open scaleable systems to deliver more products to more customers and to
control operating costs;
- Maintain high standards for asset
quality through disciplined credit risk management;
- Develop innovative products and
services that attract its targeted customers and address inefficiencies in
the Indian financial sector;
- Continue to develop products and
services that reduce its cost of funds; and
- Focus on healthy earnings growth with
low volatility.
Financial
Performance:
The financial
performance during the fiscal year ended March 31, 2010 remained healthy with
total net revenues (net interest income plus other income) increasing by 14% to
Rs. 121942.000 millions from Rs. 107118.000 millions in the previous financial
year. Revenue growth was driven both by an increase in net interest income and
other income. Net interest income grew by 13% primarily due to an increase in
the average balance sheet size and an increase in full year net interest
margins by 13 basis points to 4.3%.
Other income
registered a growth of 15.7% over that in the previous year to Rs. 38076.000
millions in the financial year ended March 31, 2010. This growth was driven
primarily by an increase in fees and commissions earned and income from foreign
exchange and derivatives offset in part by lower bond gains than those in the
previous financial year. In the fiscal year ended March 31, 2010, commission
income increased by 15.2% to Rs. 28306.000 millions with the main drivers being
fees on debit and credit cards, transactional charges and fees on deposit
accounts and processing fees on retail assets. Commissions from the
distribution of third party insurance and mutual funds remained one of the
major components of fees and commissions. Whilst the regulatory changes
restricted the commissions payable to banks by mutual funds, the same was
offset by higher distribution volumes. The Bank made a profit on the sale /
revaluation of investments of Rs. 3451.000 millions during the year, almost 10%
lower than that in the previous year as yields started moving up since the
third quarter of the financial year ended March 31, 2010. Foreign exchange and
derivatives revenues grew from Rs. 4405.000 millions in the previous financial
year to Rs. 6232.000 millions in the fiscal year ended March 31, 2010.
Operating
(non-interest) expenses grew at a much lower pace than net revenues and
increased from Rs. 55328.000 millions in the previous financial year to Rs.
57645.000 millions in the year under consideration. During the year the Bank
opened over 300 new branches which resulted in higher infrastructure and
staffing expenses. Due to the efforts of the Bank in areas of cost management
and on improving overall productivity, coupled with revenue synergies with the
network of the erstwhile Centurion Bank of Punjab, the ratio of operating cost
to net revenues improved to 47.3%, from 51.7% in the previous year.
Loan loss
provisions for non-performing assets and provisions for standard assets
increased from Rs. 17263.000 millions to Rs. 19389.000 millions due to higher
NPA formations during the first half of the financial year ended March 31,
2010. The incremental NPA formations subsequently came down in the second half
of the year. The Bank’s provisioning policies for specific loan loss provisions
remained higher than regulatory requirements. The NPA coverage ratio based on
specific provisions was at 74.8% as on March 31, 2010. The Bank also provided
Rs. 2010.000 millions towards floating provisions, contingent provisions for
tax, legal and other contingencies. The Reserve Bank of India had reduced the general
provisioning requirements for certain asset classes in May 2008, this reduced
the requirements for general provisions for the Bank’s loan book. The Bank did
not write back any of these provisions and continued to maintain the general
provisions that were already created. As a result of the above, the requirement
for general assets provisions was lower than what the Bank held on its books as
on March 31, 2010 and the Bank did not have to may any additional general
provisions for the increase in its loan book.
Net profit
increased by 31% from Rs. 22450.000 millions in the previous financial year to
Rs. 29487.000 millions in the year ended March 31, 2010. Return on average net
worth was 16.8%. The Bank’s basic earning per share increased from Rs. 52.9 to
Rs. 67.6 per equity share.
As at March 31,
2010, the Bank’s total balance sheet increased by 21% to Rs. 2224590.000
millions as against Rs. 1832710.000 millions as at March 31, 2009. Total
Deposits increased 17% from Rs. 1428120.000 millions as on March 31, 2009 to
Rs. 1674040.000 millions as on March 31, 2010. With Savings account deposits at
Rs. 498770.000 millions and current account deposits at Rs. 372270.000
millions, demand (CASA) deposits were around 52% of total deposits as on March
31, 2010 higher than 44% at the end of the previous year. During the financial
year ended March 31, 2010, gross advances grew by 27% to Rs. 1272620.000
millions. This was driven by a growth of 41% in wholesale advances to Rs.
549910.000 millions, and an increase of 18% in retail advances to Rs.
722710.000 millions. The growth in advances of the Bank have been significantly
higher than the system credit growth which was approximately 17%.
Business Segments’
Update:
Consistent with
its performance in the past, in the last financial year, the Bank has achieved
healthy growth across various operating and financial parameters. This
performance reflected the strength and diversity of the Bank’s three primary
business franchises – retail banking, wholesale banking and treasury, and of
its disciplined approach to risk-reward management.
Retail Banking
The Bank caters to
various customer segments with a wide range of products and services. The Bank
is a one stop shop financial services provider of various deposit products, of
retail loans (auto loans, personal loans, commercial vehicle loans, mortgages,
business banking etc.), credit cards, debit cards, depository (custody
services), investment advisory, bill payments and several transactional
services. Apart from its own products, the Bank sells third party financial
products like mutual funds and insurance. The growth in your Bank’s retail
banking business was robust during the financial year ended March 31, 2010. The
Bank’s total retail deposits grew by over 14% to Rs. 1135270.000 millions in
the financial year ended March 31, 2010, driven by retail savings balances
which grew much faster at 44% during the same period. The Bank’s retail assets
grew by 18% to Rs. 722710.000 millions during the financial year ended March
31, 2010 driven primarily by a growth in auto loans, mortgages, business
banking and commercial vehicle loans.
Branch Banking
This year the Bank
expanded its distribution network – from 1,412 branches in 528 cities as on
March 31, 2009 to
1,725 branches in 779
cities on March 31, 2010. The Bank’s ATMs increased from 3,295 to 4,232 during
the same period. The Bank’s branch network is deeply entrenched across the
country with significant density in areas conducive to the growth of its
businesses. The Bank’s focus on semi-urban and under banked markets continued,
with 68% of the Bank’s branches now outside the top nine Indian cities. The
Bank’s customer base grew in line with the growth in its network and increased
product penetration initiatives, this currently stands at over 19 million
customers. The average savings balance per account which is a good indicator of
the strength of the Bank’s retail
liability
franchise grew over 30%. The Bank continues to provide unique products and
services with customer centricity a key objective.
In order to
provide its customers increased choices, flexibility and convenience the Bank
continued to make significant headway in its multi channel servicing strategy.
The Bank offered its customers the use of ATMs, internet, phone and mobile
banking in addition to its expanded branch network to serve their banking
needs.
The increase in
the Bank’s debit card base this year coupled with a growth in its ATM network
translated to an increase in ATM transactions by 26%. The Bank also made strong
inroads in its internet banking channel with around 21% of its registered
customers now using net banking facilities for their banking requirements. The
bank now offers phone banking in 778 locations in addition to giving its
customers the convenience of accessing their bank accounts over their mobile
phones. The success of the Bank’s multi-channel strategy is evidenced in the
fact that almost 80% of customer initiated transactions are serviced through
the non-branch channels.
Retail Assets
The Bank continued
to grow at a healthy pace in almost all the retail loan products that it offers
and further consolidated its position amongst the top retail lenders in India.
The Bank grew its retail asset portfolio in a well balanced manner focusing on both
returns as well as risk. While the Bank’s auto finance business remained a key
business driver for its retail asset portfolio, other retail loan products
exhibited robust growth rates and asset quality.
The Bank continued
its focus on internal customers for its credit cards portfolio. Overall credit
cards remained a profitable business for the Bank with over 4 million cards in
force as at March 2010. As part of its strategy to drive usage of its credit
cards the Bank also has a significant presence in the “merchant acquiring”
business with the total number of point-of-sale (POS) terminals installed at
over 90,000.
In addition to the
above products the Bank does home loans in conjunction with HDFC Limited, under
this arrangement the Bank sells loans provided by HDFC Limited. HDFC Limited
approves and disburses the loans, which are booked in their books, the Bank is
paid a sourcing fee for these loans. HDFC Limited offers the Bank upto 70% of
the fully disbursed home loans sourced under this arrangement through either
the issue of mortgage backed pass through certificates (PTCs) or by a direct
assignment of loans; the balance is retained by HDFC Limited. Both the PTCs or
the loans thus assigned are credit enhanced by HDFC Limited upto a AAA level.
The Bank purchases these loans at the underlying home loan yields less a fee
paid to HDFC Limited for the administration and servicing of the loans.
The Bank
originated approximately an average Rs. 5000.000 millions of mortgages every
month in the financial year ended March 31, 2010, a significant increase from
the Rs. 4000.000 millions per month that the Bank originated in the previous
year. During the year the bank also purchased from HDFC Limited. under the
“loan assignment” route approximately Rs 48700.000 millions of AAA credit
enhanced home loans which qualified as priority sector advances.
The Bank also
distributes life and general insurance and mutual fund products through its
tie-ups with insurance companies and mutual fund houses. The income from these
businesses continued to demonstrate robust growth largely due to an expanded
branch network and the increased penetration of the Bank’s managed portfolio
despite the fact that during the year there were regulatory changes which in
some cases impacted the commission paid by the manufacturers of these products
to the Bank. The success in the distribution of the above products has been
demonstrated with the growth in the Bank’s fee income. The Bank’s data
warehouse, Customer Relationship Management (CRM) and analytics solutions have
helped it target existing and potential customers more effectively and cost
effectively and offer them products appropriate to their profile and needs.
Reduced costs of acquisition apart, this has also led to deepening of customer relationships
and greater efficiency in fraud control and collections resulting in lower
credit losses.
Wholesale Banking
The Bank provides
its corporate and institutional clients a wide range of commercial and
transactional banking products, backed by high quality service and relationship
management. The Bank’s commercial banking business covers not only the top end
of the corporate sector but also the emerging corporate segment and some small
and medium enterprises (SMEs). The Bank has a number of business groups
catering to various segments of its wholesale banking customers with a wide
range of banking services covering their working capital, term finance, trade
services, cash management, foreign exchange and electronic banking
requirements.
This business
registered a healthy growth in the financial year ended March 31, 2010. The
Bank’s wholesale deposits grew by around 24%, while wholesale advances showed a
strong growth of over 40% both of which were significantly faster than the
growth in the system during the same period. The Bank provides its customers
both working capital and term financing. The Bank witnessed an increase in the
proportion of its term lending even though working capital loans retained a
large share of its wholesale advances. While the duration of the Bank’s term
loans largely remained small to medium term, the Bank did witness an increase
in its longer duration term loans, and project lending, including loans to the
infrastructure segment.
During the financial
year ended March 31, 2010, growth in the wholesale banking business continued
to be driven by new customer acquisition and higher cross-sell with a focus on
optimizing yields and increasing product penetration. The Bank’s cash
management and vendor and distributor (supply chain) finance products continued
to be an important contributor to growth in the corporate banking business. The
Bank further consolidated its position as a leading player in the cash
management business (covering all outstation collection, disbursement and
electronic fund transfer products across the Bank’s various customer segments)
with volumes growing to over Rs. 25 trillion. The Bank also strengthened its
market leadership in cash settlement services for major stock exchanges and
commodity exchanges in the country. The Bank met the overall priority sector
lending requirement of 40% of net bank credit.
The Bank’s
financial institutions and government business group (FIG) offers commercial
and transaction banking
products to financial
institutions, mutual funds, public sector undertakings, central and state
government departments. The main focus for this segment remained offering
various deposit and transaction banking products to this segment besides
deepening these relationships by offering funded, non-funded treasury and
foreign exchange products.
International Operations
The Bank has a
wholesale banking branch in Bahrain and two representative offices in UAE and
Kenya. The branch offers the Bank’s suite of banking services including
treasury and trade finance products to its corporate clients. This branch has
built up an asset book over USD 400 million since its opening in October 2008.
The Bank offers wealth management products, remittance facilities and markets
deposits to the Non-resident Indian community from its representative offices.
Treasury
The treasury group
is responsible for compliance with reserve requirements and management of
liquidity and interest rate risk on the Bank’s balance sheet. On the foreign
exchange and derivatives front, revenues are driven primarily by spreads on
customer transactions based on trade flows and customers’ hedging needs. During
the financial year ended March 31, 2010, revenues from foreign exchange and
derivative transactions grew by 41.5% to Rs. 6230.000 millions. These revenues
were distributed across large corporate, emerging corporate, business banking
and retail customer segments for plain vanilla foreign exchange products and
across primarily large corporate and emerging corporate segments for
derivatives. The Bank offers Indian rupee and foreign exchange derivative
products to its customers, who use them to hedge their market risks. The Bank
enters into foreign exchange and derivative deals with counterparties after it
has set up appropriate counterparty credit limits based on its evaluation of
the ability of the counterparty to meet its obligations in the event of
crystallization of the exposure. Appropriate credit covenants may be stipulated
where required as trigger events to call for collaterals or terminate a
transaction and contain the risk. Where the Bank enters into foreign currency
derivative contracts with its customers it lays hem off in the inter-bank
market on a matched basis. For such foreign currency derivatives, the Bank does
not have any open positions or assume any market risks but carries only the
counterparty credit risk (where the customer has crystallized payables or
mark-to-market losses). The Bank also deals in Indian rupee derivatives on its
own account including for the purpose of its own balance sheet risk management.
The Bank recognizes changes in the market value of all rupee derivative
instruments (other than those designated as hedges) in the profit and loss
account in the period of change. Rupee derivative contracts classified as hedge
are recorded on an accrual basis.
Given the
regulatory requirement of holding government securities to meet the statutory
liquidity ratio (SLR) requirement, the Bank maintains a portfolio of government
securities. While a significant portion of these SLR securities are held in the
“Held-to-Maturity’ (HTM) category, some of these are held in the “Available for
Sale” (AFS) category. In the first two quarters of the last year the Bank
realized gains on its bond portfolio partly offset by the losses made in the
second and third quarters of the financial year ended March 31, 2010.
BACKGROUND
HDFC Bank Limited,
incorporated in Mumbai, India is a publicly held banking company engaged in
providing a wide range of banking and financial services including commercial
banking and treasury operations. HDFC Bank is a banking company governed by the
Banking Regulation Act, 1949. The Bank also has one overseas branch in Bahrain.
Unaudited financial results for the Quarter and Nine months ended
DECEMBER 31, 2010
(Rs. in millions)
|
Particulars |
31.12.2010 (Unaudited) |
31.12.2010 (Unaudited) |
|
Interest Earned |
52299.600 |
144601.100 |
|
Interest/discount on advances/bills |
39503.800 |
109340.800 |
|
Income on Investments |
12258.300 |
33793.100 |
|
Interest on balances with Reserve Bank of India and other inter bank
funds |
517.100 |
1294.400 |
|
Others |
20.400 |
172.800 |
|
Other Income |
11278.200 |
30789.400 |
|
TOTAL INCOME |
63577.800 |
175390.500 |
|
Interest Expended |
24532.700 |
67560.000 |
|
Operating Expenses |
18318.200 |
51545.500 |
|
Employee Cost |
7250.500 |
21026.900 |
|
Other Operating Expenses |
11067.700 |
30518.600 |
|
Total Expenditure |
42850.900 |
119105.500 |
|
Operating Profit before Provisions and Contingencies |
20726.900 |
56285.000 |
|
Provisions (Other than tax) and Contingencies |
4658.700 |
14753.700 |
|
Profit / (Loss) from ordinary activities before tax |
16068.200 |
41531.300 |
|
Tax Expenses |
5189.900 |
13414.500 |
|
Net Profit / (Loss) |
10878.300 |
28116.800 |
|
Paid- up
Equity Share Capital (Face value
of the share – Rs. 10) |
4643.300 |
4643.300 |
|
Reserves
excluding revaluation reserves (as per last audited balance sheet) |
---- |
---- |
|
Analytical Ratios |
|
|
|
Capital Adequacy Ratio |
16.3% |
16.3% |
|
Basic and
diluted Earnings per share for the period, for the year to date (not
annualized) and for the previous year – Rs. |
23.50 |
61.00 |
|
Diluted EPS before & after extraordinary items (net of tax
expense) - not annualized |
23.10 |
60.20 |
|
NPA Ratios |
|
|
|
(a) Gross NPAs |
17817.600 |
17817.600 |
|
(b) Net NPAs |
3306.700 |
3306.700 |
|
(c) % of Gross NPAs to Gross Advances |
1.11% |
1.11% |
|
(d) % of Net NPAs to Net Advances |
0.2% |
0.2% |
|
(v) Return on assets (average) - not annualized |
0.4% |
0.4% |
|
Public
shareholding |
|
|
|
Number of
Shares |
274557922 |
274557922 |
|
Percentage of Shareholding |
59.1% |
59.1% |
|
Shares underlying Depository Receipts ( ADS and GDR ) |
|
|
|
Number of
Shares |
81128819 |
81128819 |
|
Percentage of Shareholding |
17.5% |
17.5% |
|
Promoters and
promoter group shareholding |
|
|
|
Non -
encumbered Number of
Shares Percentage of
Shares (as a % of
the total shareholding of promoter and promoter
group) Percentage of
Shares (as a % of
the total share capital of the company) |
108643220 100.0% 23.4% |
108643220 100.0% 23.4% |
Segment information in accordance with the Accounting
Standard on Segment Reporting (AS 17) of the operating segments of the Bank is
as under :
(Rs. in millions)
|
Sl. No. |
|
Particulars |
Quarter Ended |
Quarter Ended |
|
|
31.12.2010 |
31.12.2010 |
||
|
|
(Un-audited) |
(Un-audited) |
||
|
1 |
|
Segment Revenue |
|
|
|
|
|
|
|
|
|
|
|
a) Treasury |
14173.600 |
37683.700 |
|
|
|
b) Retail Banking |
51305.100 |
139136.800 |
|
|
|
c) Wholesale
Banking |
32071.400 |
84776.200 |
|
|
|
d) Other banking
operations |
6069.400 |
17803.000 |
|
|
|
Total |
103619.500 |
279399.700 |
|
|
|
|
|
|
|
|
|
Less : Inter Segment Revenue (Net of Excise) |
40041.700 |
104009.200 |
|
|
|
|
|
|
|
|
|
Income from
Operation |
63577.800 |
175390.500 |
|
|
|
|
|
|
|
2 |
|
Segment Results |
|
|
|
|
|
|
|
|
|
|
|
a) Treasury |
(52.100) |
(77.800) |
|
|
|
b) Retail Banking |
7573.700 |
21193.700 |
|
|
|
c) Wholesale
Banking |
7816.900 |
18980.500 |
|
|
|
d) Other banking
operations |
2368.400 |
6748.200 |
|
|
|
e)
Unallocated |
(1638.700) |
(5313.300) |
|
|
|
Total Profit Before
Tax |
16068.200 |
41531.300 |
|
|
|
|
|
|
|
3 |
|
Capital Employed
(Segment Assets - Segment Liabilities) |
|
|
|
|
|
|
|
|
|
|
|
a) Treasury |
607405.300 |
607405.300 |
|
|
|
b) Retail Banking |
(550543.400) |
(550543.400) |
|
|
|
c) Wholesale
Banking |
229418.400 |
229418.400 |
|
|
|
d) Other banking
operations |
44654.700 |
44654.700 |
|
|
|
e)
Unallocated |
(80438.800) |
(80438.800) |
|
|
|
Total |
250496.200 |
250496.200 |
Notes :
- Statement of Assets and Liabilities
as on December 31, 2010 is given below.
|
4. STATEMENT OF ASSETS AND LIABILITIES
(Rs. In Millions) |
31.12.2010
UNAUDITED |
|
CAPITAL AND
LIABILITIES |
|
|
Capital |
4643.300 |
|
Reserves and
surplus |
245852.900 |
|
Employees Stock
Options (Grants) Outstanding |
29.100 |
|
Deposits |
1922015.600 |
|
Borrowing |
134356.000 |
|
Other Liabilities & Provisions |
191303.300 |
|
|
|
|
Total
|
2498200.200 |
|
|
|
|
ASSETS |
|
|
Cash & Balances with Reserve Bank of
|
159946.600 |
|
Balances with Banks & money at Call
& Short Notice |
25436.300 |
|
Investments |
630136.600 |
|
Advances |
1591836.300 |
|
Fixed Assets |
21327.100 |
|
Other Assets |
69517.300 |
|
|
|
|
Total
|
2498200.200 |
- The above results have been approved
by the Board of Directors at its meeting held on January 27, 2011.
- These results for the quarter and nine
months ended December 31, 2010, have been subject to a "Limited
Review" by the Statutory Auditors of the Bank.
- During the quarter and nine months
ended December 31, 2010, the Bank allotted 1725111 and 6586689 shares
pursuant to the exercise of stock options by certain employees.
- Other income relates to income from
non-fund based banking activities including commission, fees, foreign
exchange earnings, earnings from derivative transactions and profit and
loss (including revaluation) from investments.
- Effective April 1, 2010, the Bank has
classified fees paid relating to transactions done by the bank’s
customers on other banks’ ATMs, which hitherto were netted from fees and
commissions, under operating expenses. Figures for the previous periods
have been regrouped / reclassified to conform to current period's
classification.
- Floating provisions have been
classified as Tier 2 capital and reflected under Other Liabilities with
effect from the current financial year. These provisions were hitherto
netted from Advances and from Gross NPAs in arriving at Net NPAs.
- In accordance with RBI guidelines
under reference RBI/2009-2010/356 IDMD/4135/11.08.43/2009-10 dated March
23, 2010, effective April 1, 2010, Report and Reverse Repo transactions
in government securities and corporate debt securities (excluding
transactions conducted under Liquidity Adjustment Facility with RBI) are
reflected as borrowing and lending transactions respectively. These
transactions were hitherto recorded under investments as sales and
purchases respectively.
- As on December 31, 2010, the total
number of branches (including extension counters) and the ATM network
stood at 1780 branches and 5121 ATMs respectively.
- Information on investor complaints pursuant
to Clause 41 of the listing agreement for the quarter ended December 31,
2010: Opening : Nil ; Additions : 217 ; Disposals : 217 ; Closing
position : Nil.
- Figures of the previous period have
been regrouped / reclassified wherever necessary to conform to current
period's classification.
NEWS RELEASE
HDFC BANK LIMITED - FINANCIAL RESULTS (INDIAN GAAP) FOR
THE QUARTER AND NINE MONTHS ENDED DECEMBER 31, 2010
The Board of
Directors of HDFC Bank Limited approved the Bank’s (Indian GAAP) accounts for the
quarter and nine months ended December 31, 2010 at its meeting held in Mumbai
on Thursday, January 27, 2011. The accounts have been subject to a
"Limited Review" by the Statutory Auditors of the Bank.
FINANCIAL RESULTS:
Profit and Loss
Account: Quarter ended December 31, 2010
The Bank’s total
income for the quarter ended December 31, 2010 was Rs. 6,357.8 crores as
against Rs. 4,933.9 crores for the quarter ended December 31, 2009. Net
revenues (net interest income plus other income) were Rs. 3,904.5 crores for
the quarter ended December 31, 2010, an increase of 25.0% over Rs.3,123.0
crores for the corresponding quarter of the previous year. Interest earned (net
of loan origination costs and amortization of premia on investments held in the
Held to Maturity (HTM) category) increased from Rs. 4,034.8 crores in the
quarter ended December 31, 2009 to Rs. 5,230.0 crores in the quarter ended
December 31, 2010. Net interest income (interest earned less interest expended)
for the quarter ended December 31, 2010 grew by 24.9% to Rs. 2,776.7 crores,
driven by asset growth and a net interest margin (NIM) of 4.2% for the quarter
ended December 31, 2010 which remained stable on a sequential basis.
Other income
(non-interest revenue) for the quarter ended December 31, 2010 was at Rs.
1,127.8 crores, primarily contributed by fees and commissions of Rs. 942.8
crores, up 22.5% over Rs. 769.7 crores during the quarter ended December 31,
2009. The other two components of other income were foreign exchange and
derivative revenues of Rs. 216.8 crores (Rs. 154.3 crores for the corresponding
quarter ended December 31, 2009) and a loss on sale / revaluation of
investments of Rs. 30.7 crores (loss of Rs. 26.5 crores for the corresponding
quarter of the previous year).
Operating expenses,
for the quarter ended December 31, 2010 were up 22.2% to Rs. 1,831.8 crores.
The core cost to income ratio was at 46.5% as against 47.6% for the quarter
ended December 31, 2009. Provisions and contingences increased by 4.1% from Rs.
447.7 crores (including loan loss provisions of Rs. 437.9 crores) for the
quarter ended December 31, 2009 to Rs. 465.9 crores (including loan loss
provisions of Rs. 292.9 crores) for the quarter ended December 31, 2010. Profit
before tax for the quarter ended December 31, 2010 increased by 36.6% over the
corresponding quarter ended December 31, 2009 to ` 1,606.8 crores. After
providing Rs. 519.0 crores for taxes, the Bank earned a Net Profit of Rs.
1,087.8 crores, an increase of 32.9% over the corresponding quarter ended
December 31, 2009.
Balance Sheet: As
of December 31, 2010
The Bank’s total
balance sheet size increased by 22.1% to Rs. 249,820 crores as of December 31,
2010. Total deposits were Rs. 192,202 crores, up by 24.2% over December 31,
2009. The CASA mix at 50.5% of total deposits as at December 31, 2010 was
primarily driven by a 30.7% growth in savings deposits to Rs. 61,038 crores as
at December 31, 2010. Gross advances grew by 32.7% over December 31, 2009 to
Rs. 160,619 crores.
Nine Months ended
December 31, 2010
For the nine
months ended December 31, 2010, the Bank earned total income of Rs. 17,539.1
crores as against Rs. 15,152.0 crores in the corresponding period of the
previous year. Net revenues (net interest income plus other income) for the
nine months ended December 31, 2010 increased by Rs.1,715.6 crores to Rs.
10,783.1 crores. Net Profit for the nine months ended December 31, 2010 was Rs.
2,811.7 crores, up by 33.1% over the corresponding nine months ended December
31, 2009.
Capital Adequacy:
The Bank’s total
Capital Adequacy Ratio (CAR) as at December 31, 2010 (computed as per Basel 2
guidelines) remained strong at 16.3%, against the regulatory minimum of 9%.
Tier-I CAR was 12.1% as of December 31, 2010.
DISTRIBUTION
NETWORK :
As of December 31,
2010, the Bank’s distribution network was 1,780 branches and 5,121 ATMs in 833
cities as against 1,725 branches and 3,898 ATMs in 771 cities as of December
31, 2009.
ASSET QUALITY :
Portfolio quality
as of December 31, 2010 remained healthy with gross nonperforming assets (NPAs)
at 1.1% of gross advances and net non-performing assets at 0.2% of net advances
(as against 1.6% gross NPA and 0.5% net NPA ratios as of December 31, 2009).
The Bank’s provisioning policies for specific loan loss provisions remained
higher than regulatory requirements. The NPA provision coverage ratio
(excluding write-offs, technical or otherwise) was at 81% as of December 31,
2010 as compared to 72% as of December 31, 2009. Total restructured assets were
0.3% of the bank’s gross advances as of December 31, 2010.
Note:
` = Indian Rupees
1 crore = 10
million
All figures and
ratios are in accordance with Indian GAAP.
Certain statements are included in this release which contain words or
phrases such as “will,” “aim,” “will likely result,” “believe,” “expect,” “will
continue,” “anticipate,” “estimate,” “intend,” “plan,” “contemplate,” “seek
to,” “future,” “objective,” “goal,” “project,” “should,” “will pursue” and
similar expressions or variations of these expressions that are
“forward-looking statements.” Actual results may differ materially from those
suggested by the forward-looking statements due to certain risks or
uncertainties associated with our expectations with respect to, but not limited
to, our ability to implement our strategy successfully, the market acceptance
of and demand for various banking services, future levels of our nonperforming
loans, our growth and expansion, the adequacy of our allowance for credit and
investment losses, technological changes, volatility in investment income, our
ability to market new products, cash flow projections, the outcome of any
legal, tax or regulatory proceedings in India and in other jurisdictions we are
or become a party to, the future impact of new accounting standards, our
ability to pay dividends, the impact of changes in banking regulation and other
regulatory changes in India and other jurisdictions on us, our ability to roll
over our short-term funding sources and our exposure to market and operational
risks. By their nature, certain of the market risk disclosures are only
estimates and could be materially different from what may actually occur in the
future. As a result, actual future gains, losses or impact on net income could
materially differ from those that have been estimated. In addition, other
factors that could cause actual results to differ materially from those
estimated by the forward-looking statements contained in this document include,
but are not limited to: general economic and political conditions, instability
or uncertainty in India and the other countries which have an impact on our
business activities or investments, caused by any factor including terrorists
attacks in India or elsewhere, anti-terrorist or other attacks by any country,
military armament or social unrest in any part of India; the monetary and
interest rate policies of the government of India; natural calamities,
inflation, deflation, unanticipated turbulence in interest rates, foreign
exchange rates, equity prices or other rates or prices; the performance of the
financial markets in India and globally; changes in Indian and foreign laws and regulations, including
tax, accounting and banking regulations; changes in competition and the pricing
environment in India; and regional or general changes in asset valuations.
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 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.44.77 |
|
|
1 |
Rs.72.66 |
|
Euro |
1 |
Rs.63.06 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
9 |
|
OPERATING SCALE |
1~10 |
9 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
8 |
|
--LIQUIDITY |
1~10 |
9 |
|
--LEVERAGE |
1~10 |
9 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
8 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
NO |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
NO |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
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.