MIRA
INFORM REPORT
|
Report Date : |
06.05.2011 |
\
Note: The Company has been shifted from the above address.
IDENTIFICATION DETAILS
|
Name : |
AGC NETWORKS LIMITED (w.e.f 27.04.2010) |
|
|
|
|
Formerly Known As : |
AVAYA GLOBAL CONNECT LIMITED |
|
|
|
|
Registered Office : |
|
|
|
|
|
Country : |
|
|
|
|
|
Financials (as on) : |
30.09.2010 |
|
|
|
|
Date of Incorporation : |
19.08.1986 |
|
|
|
|
Com. Reg. No.: |
11-040652 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs. 142.332 Millions |
|
|
|
|
CIN No.: [Company
Identification No.] |
L32200MH1986PLC040652 |
|
|
|
|
TAN No.: [Tax
Deduction & Collection Account No.] |
AHMT00385A |
|
|
|
|
PAN No.: [Permanent
Account No.] |
AAACT3992M |
|
|
|
|
Legal Form : |
Public Limited Liability Company. Its shares are listed on the Stock Exchanges. |
|
|
|
|
Line of Business : |
Manufacturing of EPABX, Transmission Equipments, Telephone Instruments, Answering Machines and Cordless Telephones. |
|
|
|
|
No. of Employees
: |
542 (approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
A (66) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
Maximum Credit Limit : |
USD 10000000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a subsidiary of Avaya Inc., The company can be considered normal for business dealings at usual trade terms and conditions. |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
INFORMATION DENIED BY
|
Name : |
Mr. Prasad Subramaiam |
|
Designation : |
Divisional Manager – Finance and Accounts |
|
Contact No.: |
91-79-66712200 |
|
Date : |
06.05.2011 |
LOCATIONS
|
Registered Office : |
|
|
E-Mail : |
gambhir@gnr.ttl.sprintsmx.ems.vsnl.net.in |
|
Website : |
|
|
|
|
|
Corporate Office : |
|
|
Tel No.: |
91-124-4093333/ 25605000 |
|
Fax No.: |
91-124-2560619/ 20/ 21 |
|
|
|
|
Factory : |
E-1/1, Gandhinagar Electronics Estate, Gandhinagar - 382 044, |
|
Tel No.: |
91-79-66712200 |
|
Fax No.: |
91-79-66712287 |
|
|
|
|
Regional Offices : |
Located at:
|
|
|
|
|
Branches and Service Centres : |
Located At:
|
DIRECTORS
As On 30.09.2010
|
Name : |
Mr. S. Ramakrishnan |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Mr. Anil Nir |
|
Designation : |
Joint Managing Director and President |
|
|
|
|
Name : |
Mr. Anil Batra |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. S. K. Jha |
|
Designation : |
Managing Director and CEO |
|
|
|
|
Name : |
Mr. Anshuman Ruia |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Aparup Sengupta |
|
Designation : |
Director |
|
|
|
|
Name : |
Prof. Debashis Chatterjee |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Vikash Saraf |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Amarnath K. Pai |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. David Manganello |
|
Designation : |
Director |
|
|
|
|
Name : |
Ms. Pamela F. Craven |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Hoshang Noshirwan Sinor |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Christopher Formant |
|
Designation : |
Director |
KEY EXECUTIVES
|
Name : |
Mr. Vishal Kohli |
|
Designation : |
Company Secretary |
|
|
|
|
Name : |
Mr. Amal Thakore |
|
Designation : |
Vice President and Head (Finance) |
|
|
|
|
Audit Committee: |
|
|
|
|
|
Shareholders’/ Investors’ Grievance Committee: |
·
Mr.
Anil Bathra – Chairman ·
S. K.
Jha ·
Debashis
Chatterjee |
|
|
|
|
Ethics and Compliance Committee: |
·
Mr.
Anil Batra ·
Debashis
Chatterjee – Chairman |
|
|
|
|
Remuneration Committee: |
|
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
AS ON 31.03.2011
|
Category |
No. of Shares |
Percentage of
Holding |
|
(A) Shareholding of Promoter and Promoter Group |
|
|
|
|
|
|
|
|
2,846,647 |
20.00 |
|
|
2,846,647 |
20.00 |
|
|
|
|
|
|
8,415,988 |
59.13 |
|
|
8,415,988 |
59.13 |
|
Total shareholding of Promoter and Promoter Group (A) |
11,262,635 |
79.13 |
|
(B) Public Shareholding |
|
|
|
|
|
|
|
|
3,100 |
0.02 |
|
|
1,100 |
0.01 |
|
|
21,333 |
0.15 |
|
|
145,098 |
1.02 |
|
|
84,695 |
0.60 |
|
|
255,326 |
1.79 |
|
|
|
|
|
|
463,578 |
3.26 |
|
|
|
|
|
|
2,038,858 |
14.32 |
|
|
198,633 |
1.40 |
|
|
14,202 |
0.10 |
|
|
14,202 |
0.10 |
|
|
2,715,271 |
19.08 |
|
Total Public shareholding (B) |
2,970,597 |
20.87 |
|
Total (A)+(B) |
14,233,232 |
100.00 |
|
(C) Shares held by Custodians and against which Depository Receipts
have been issued |
- |
- |
|
|
- |
- |
|
|
- |
- |
|
|
- |
- |
|
Total (A)+(B)+(C) |
14,233,232 |
- |
(1) Indian
Bodies Corporate
Individual shareholders holding nominal share
capital up to Rs. 0.100 million
BUSINESS DETAILS
|
Line of Business : |
Manufacturing of EPABX, Transmission Equipments, Telephone Instruments, Answering Machines and Cordless Telephones. |
||||||
|
|
|
||||||
|
Products : |
|
||||||
|
|
|
PRODUCTION STATUS (AS ON 30.09.2010)
|
Class of Goods |
Unit |
Installed Capacity - on single shift basis |
Actual Production |
|
EPABX |
No. of ports |
250000 |
60944 |
Note: The installed capacity is as per certificate
given by Management, on which the auditors have relied being a technical
matter.
GENERAL INFORMATION
|
No. of Employees : |
542 (approximately) |
|
|
|
|
Bankers : |
|
|
|
|
|
Facilities : |
-- |
|
|
|
|
Banking Relations
: |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
Lovelock and Lewes Chartered Accountants |
|
|
|
|
Where Control Exists : |
Through its 100% subsidiaries - 1) Sierra Communication International LLC (formerly Avaya
International, 2) Avaya Mauritius Limited (upto 31.08.2010) |
|
|
|
|
Subsidiaries : |
|
|
|
|
|
Fellow Subsidiaries : |
|
CAPITAL STRUCTURE
AS ON 30.09.2010
Authorised Capital
|
No. of Shares |
Type |
Value |
Amount |
|
25000000 |
Equity Shares |
Rs. 10/- each |
Rs. 250.000
millions |
|
1000000 |
Cumulative Redeemable
Preference Shares |
Rs. 100/- each |
Rs. 100.000
millions |
|
|
TOTAL |
|
Rs.350.000 millions |
Issued, Subscribed
& Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
14233232 |
Equity Shares [84,15,988 and 28,46,647 shares held by Essar Services Holdings Limited and Essar Capital Finance Private Limited respectively (previous year 36,30,035 and 47,85,953 shares held by Sierra Communication International LLC (formerly Avaya International LLC) and Avaya Mauritius Limited respectively, subsidiaries of the ultimate holding company, Avaya Inc. USA)] |
Rs. 10/- each |
Rs. 142.332
millions |
Note:
1) Of the above, 4,26,692 equity shares have been allotted on amalgamation of the erstwhile Tata Keltron Limited without payment being received in cash.
2) During the year, pursuant to the share purchase agreement between the Sellers (Avaya Mauritius Limited and Sierra Communication International LLC) and Essar Services Holdings Limited and Essar Capital Finance Private Limited, Essar Services Holdings Limited acquired 59.13% shareholding in the Company from the Sellers. Further, Essar Capital Finance Private Limited acquired 20% shareholding in the Company vide the open offer made to the public shareholders of the Company under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997. The ultimate holding Company is Essar Global Limited.
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
30.09.2010 |
30.09.2009 |
30.09.2008 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
142.332 |
142.332 |
142.300 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
2473.740 |
2198.907 |
2103.500 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
2616.072 |
2341.239 |
2245.800 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
0.000 |
0.000 |
0.000 |
|
|
2] Unsecured Loans |
0.000 |
0.000 |
1.900 |
|
|
TOTAL BORROWING |
0.000 |
0.000 |
1.900 |
|
|
DEFERRED TAX LIABILITIES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
2616.072 |
2341.239 |
2247.700 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
178.833 |
184.703 |
228.400 |
|
|
Capital work-in-progress |
33.614 |
2.815 |
13.800 |
|
|
|
|
|
|
|
|
INVESTMENT |
145.000 |
150.000 |
150.900 |
|
|
DEFERREX TAX ASSETS |
122.069 |
122.103 |
143.100 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
455.908
|
488.185
|
666.100
|
|
|
Sundry Debtors |
1288.522
|
1263.775
|
1379.700
|
|
|
Cash & Bank Balances |
1432.659
|
1116.929
|
871.800
|
|
|
Other Current Assets |
0.000
|
0.000
|
0.000
|
|
|
Loans & Advances |
575.698
|
695.411
|
589.500
|
|
Total
Current Assets |
3752.787
|
3564.300
|
3507.100
|
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
871.428 |
949.508 |
907.300
|
|
|
Other Current Liabilities |
617.367
|
615.994
|
759.100
|
|
|
Provisions |
127.436
|
117.180
|
129.200
|
|
Total
Current Liabilities |
1616.231
|
1682.682
|
1795.600
|
|
|
Net Current Assets |
2136.556
|
1881.618
|
1711.500
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
2616.072 |
2341.239 |
2247.700 |
|
PROFIT & LOSS ACCOUNT
|
|
PARTICULARS |
30.09.2010 |
30.09.2009 |
30.09.2008 |
|
|
|
SALES |
|
|
|
|
|
|
|
Sales and Services |
4945.971 |
5114.499 |
5669.500 |
|
|
|
Other Income |
28.685 |
41.975 |
33.800 |
|
|
|
TOTAL (A) |
4974.656 |
5156.474 |
5703.300 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Raw materials and components consumed |
199.022 |
253.922 |
414.200 |
|
|
|
Purchase of traded items |
2575.744 |
2655.492 |
2923.300 |
|
|
|
Manufacturing and other expenses |
1631.734 |
1736.277 |
1841.200 |
|
|
|
Excise duty |
6.407 |
6.827 |
11.200 |
|
|
|
Decrease/(Increase) in stock of finished goods and work-in-progress |
30.383 |
177.263 |
169.000 |
|
|
|
Exception item |
(9.701) |
53.405 |
0.000 |
|
|
|
TOTAL (B) |
4433.589 |
4883.186 |
5358.900 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
541.067 |
273.288 |
344.400 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
(60.261) |
(42.031) |
(40.000) |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
601.328 |
315.319 |
384.400 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
74.380 |
84.848 |
101.600 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
526.948 |
230.471 |
282.800 |
|
|
|
|
|
|
|
|
|
Less |
TAX (I) |
177.427 |
76.799 |
110.700 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-I) (J) |
349.521 |
153.672 |
172.100 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
568.979 |
553.589 |
|
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
35.000 |
80.000 |
NA |
|
|
|
Proposed Dividend |
64.050 |
49.816 |
|
|
|
|
Corporate Dividend Tax |
10.638 |
8.466 |
|
|
|
BALANCE CARRIED TO
THE B/S |
808.812 |
568.979 |
|
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Service/ Maintenance Income |
0.000 |
42.845 |
56.600 |
|
|
|
Reimbursement of Expenses |
15.045 |
30.488 |
57.900 |
|
|
|
Sales proceeds other than export |
1379.836 |
1399.084 |
1435.600 |
|
|
TOTAL EARNINGS |
1394.881 |
1472.417 |
1550.100 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials and components |
160.778 |
183.042 |
300.900 |
|
|
|
Traded Goods |
2162.819 |
2216.585 |
2391.900 |
|
|
|
Capital Goods |
47.118 |
2.846 |
36.500 |
|
|
TOTAL IMPORTS |
2370.715 |
2402.473 |
2729.300 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
24.56 |
10.80 |
12.09 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
|
|
31.12.2010 |
|
Type
|
|
|
|
1st Quarter |
|
Net Sales |
|
|
|
1250.780 |
|
Total Expenditure |
|
|
|
1142.710 |
|
PBIDT (Excl OI) |
|
|
|
108.070 |
|
Other Income |
|
|
|
13.510 |
|
Operating Profit |
|
|
|
121.580 |
|
Interest |
|
|
|
3.780 |
|
PBDT |
|
|
|
117.800 |
|
Depreciation |
|
|
|
18.640 |
|
Profit Before Tax |
|
|
|
99.160 |
|
Tax |
|
|
|
32.010 |
|
Profit After Tax |
|
|
|
67.150 |
|
Net Profit |
|
|
|
67.150 |
KEY RATIOS
|
PARTICULARS |
|
30.09.2010 |
30.09.2009 |
30.09.2008 |
|
PAT / Total Income |
(%) |
7.03
|
2.98
|
3.02 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
10.65
|
4.51
|
4.99 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
13.40
|
6.15
|
7.57 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.20
|
0.10
|
0.13 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.62
|
0.72
|
0.80 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
2.32
|
2.12
|
1.95 |
LOCAL AGENCY FURTHER INFORMATION
The Details of sundry
creditors:
Rs.
In Millions
|
Particulars |
30.09.2010 |
30.09.2009 |
30.09.2008 |
|
Sundry Creditors |
|
|
|
|
- Total outstanding dues to micro and small enterprises |
0.287 |
0.262 |
0.000 |
|
- Other dues |
871.141 |
949.246 |
907.300 |
|
Total |
871.428 |
949.508 |
907.300 |
HISTORY
Subject was
incorporated on 19.08.1986 at Mumbai in
The company was incorporated
as a private limited company under the Companies Act 1956. Subsequently the
company was converted into a Public Limited Liability Company.
Subject belongs to
Tatas and Avaya, formerly a division of Lucent Technologies, which had its
roots in AT and T. Currently, the Tatas and Avaya holds 25.5% each.
Subject floated a new company, Trans India Network System (TINS), in technical
and financial collaboration with Lucent Technologies Inc.,
In 1996, subject was accredited with ISO 9001 certifications by the STQC
Directorate, Department of Electronics, Government of India, certifying the
design, development, production, installation and servicing of range of
telecommunications equipment comprising of EPABX, Voice Processing Systems,
Transmission Systems and Network Access Systems. Subject had also been awarded
a certificate of registration by the British Standards Institute (BSI),
During the year 2000, the company launched Paradigm Plus with state-of-the-art
features like Virtual Telephony and ISDN; to its popular series of Paradigm
range from OKI. Tata Fone division also introduced new products including
Digital Answering machines and a range of feature phones.
In March 2001, the Board of the company approved a scheme of demerger of its
Tata Fone Division into a separate company. The company, ITel Industries
Private Limited, is promoted by Tata Industries Limited and will become its
100% subsidiary.
The company has won
the Forst and Sullivan Market Engineering Award 2002 for “Market Leadership in
Interaction CRM Market in
The company has also
bagged the Frost and Sullivan Marketing Strategy Award in Enterprise Voice
Equipment Market.
The name of the company
was changed to AVAYA GLOBAL CONNECT LIMITED during October 2004.
FINANCIAL
PERFORMANCE
The Company, for the year ended 30.09.2010 recorded a gross turnover of Rs. 4961.100 millions, as against Rs. 5144.000 millions for the year ended 30.09.2009. The profit before tax is Rs. 526.900 millions for the year ended 30.09.2010 as against Rs. 230.500 millions for the previous financial year. The profit after tax is Rs. 349.500 millions as against Rs. 153.700 millions for the previous financial year.
OPERATIONS
Over the review
period, global economy witnessed a measured revival. This resulted in a gradual
rise in exports and MNC investments. At the same time domestic consumption,
infrastructure building and government’s rurban (rural and semi-urban) focus provided
fillip to Indian economy.
The contact centre
market segment however did not reflect this growth as International BPOs
remained cautious and focused on sweating the already invested capital in
technology and people. The same held true for the Enterprise Telephony market
segment led by IT outsourcers and MNC companies. With the domestic sector
contributing a much larger pie towards both these market segments, the average
price realization continued to remain under pressure. Overall, the leading analysts
reported a near flat/negative growth for this industry during calendar year
2009. However in 2010, both IT and BPO companies have shown net employee
addition and volume growth in business backed by sustenance of economic
revival. This helped the industry and the Company arrest decline in business.
The Company’s
continued focus on delivering industry specific solutions, aimed at addressing
industry pain points proved to be a critical differentiator during these tough
times. The commitment to delivering business value and helping customers deploy
communication as a ‘business accelerator’ helped the Company in managing its
bottom line and repel competitive pressures. Going forward while the revenue
and price realization pressures are likely to ease, the Company will continue
to calibrate costs in order to remain profitable and make the investments
required to be future-ready. Having consistently delivered value to its
customers and stakeholders, the Company also focused on the third most
important aspect of its business i.e. employees, completing the ‘Triangle of
Equity’. It invested significantly on skill and capacity building for a
sustainable future. The Company also unveiled
The company also
held a stellar event to mark the fourth edition of ‘Customer Responsiveness’
awards that were fiercely contested across ten industry categories by
crčme-de-la-crčme of India Inc. The award ceremony was chaired by Mr. Ajay
Maken, Union Minister of State for Surface Transport, Government of India. The
grand success of this event underscored the importance of customer loyalty in
today’s day and age and the Company’s commitment towards the same.
The major factor
which differentiates AGC in the marketplace is its unique DNA characterized by:
- Cube Strategy : Value creation across
three axes – verticals, products and geographies.
- Triangle of Equity : Delivering real
value to customers, employees and stakeholders.
- Solution integration vs. System
integration.
- Solutions to business to resolve pain
points vs. selling platforms.
- Experiential selling vs. powerpoint
selling.
- Specification selling vs. brand
selling, wider solution span for customers
- Market tiering vs. a unified market
view.
- Profitable growth vs. commoditized
growth.
- Quality and standardization to minimize
invisible costs.
- Relentless focus on competency
building.
During the period,
GlobalConnect Australia Pty Limited (GCA), the wholly owned subsidiary of the
Company consolidated its position as solution integrator thanks to mid-market
focus and portfolio enhancement into Data and Wireless space. GCA having
already factored the market change and rationalized its cost-base is poised to
unlock profitable growth in times to come. GCA will continue to look for
profitable partnerships and geographic expansion in 2011.
BUSINESS OUTLOOK
The Indian
Communications Industry continues to log high volume growth albeit with increasing
margin pressure. The number of mobile subscribers has crossed 680 million. The
higher availability of telecommunication lines contributes directly to the
growth of enterprise telephony and other communication and collaboration needs.
The Company
largely operates in the Unified Communication (UC) space - Enterprise Telephony
(ET) and Contact Centres (CC). The Enterprise Telephony market is around Rs.
13500.000 Million and the Contact Centre Market is roughly around Rs. 5500.000
Million. The ET Market is slated to bounce back by the beginning of 2011. The
CC Market is expected to be driven largely by the domestic market consumption
and the projected CAGR for the market is about 14% until 2015. The Company is
slated to add new market segments – Information Security (IS) including IS
Software and Appliances and Data Networking (DN) in 2011. The DN opportunity is
twice the size of the UC space. There will be added focus on existing lines
that have been incubated in 2010 and have a high growth outlook like Board Room
AV Integration and IP Surveillance.
The year 2010 saw
the Company unveiling its new identity and announcing its rechristening as
Subject. The re-branding exercise enabled improved positioning in the
enterprise communication market. The Company is now positioned as Enterprise
Communications SI with abilities that offer diversity in technologies and
comprehensive solution suite. Besides consolidating its market leadership in
Unified Communication, Collaboration and Contact Centres in 2010, the Company
is now focusing on Data Networking, Board Room Integration, IP Surveillance,
Governance, Risk and Compliance as well as Information Storage and Security.
These capabilities along with the parent’s offering in the BPO/CLM domain,
presents the Company lots of opportunities available in global and domestic
market in Tech, IT and BPO space and become a significant player in the IT-ITeS
sector.
RECOGNITIONS
CONFERRED ON THE COMPANY
AGC won the award
for ‘Continuous Innovation in HR Strategy at Work’ at Asia’s Best Employer
Brand Award Forum in
The Company was
also conferred with the INFOCOM-CMAI national telecom award for “Excellence in
Unified Communication Solutions”, presented by Mr. Thiru A. Raja, Honorable
Minister for Communications and IT, Government of India.
Leading IT
publication, Voice and Data (V and D) bestowed AGC with the ‘Top Enterprise
Voice Solutions Company’ award for the 7th year in a row. This award was
presented by Mr. P. J. Thomas, Secretary, Department of Telecom, Government of
India.
MANAGEMENT
DISCUSSION AND ANALYSIS
Overview
The Company
aspires to be a world class solutions integrator in the Enterprise
Communication space. The Company’s solutions help organizations accelerate
revenue growth, increase market penetration, optimize operating costs and
improve employee productivity, by embedding communication in their business
processes. The Enterprise Telephony industry has shown a moderate decline in
the last fiscal due to cautious spend in 2009 and return of discretionary
spending in 2010. Most organizations focused on consolidating their technology
infrastructure and sweating the already invested capital. This meant that net
employee addition and corresponding volume growth in number of
ports/agent-seats remained near flat. This trend is expected to ease and
gradually reverse in the current fiscal with most organizations forecasting
increased hiring backed by volume growth in business. The Video Conferencing,
Board Room AV Integration and IP Surveillance markets have continued to grow
even in the last fiscal. The International Contact Centre Industry growth has
revved up in past few quarters and is likely to grow moderately in near term.
However, the domestic contact centre industry grew at a healthy rate with large
volumes at far lower per seat realizations.
The Company, as
indicated earlier in this report, intends addressing new market segments
adjacent to its current business i.e. Information Security, Appliances, Storage
and Data Networking. It also intends strengthening its base in Government, PSU
and Defense sectors in order to tap this growth segment and induct new GTM
models such as Managed Services and Business Transformation Services.
Industry
Structure and Development
The Telecommunications Industry can broadly be divided into the two segments viz.
(1) Service Provider - Basic Services,
(2) Solution Providers - Network Equipments, Enterprise Communication, Contact Centre equipment etc.
The service provider segment broadly caters to providing connectivity, mobile telephony and bandwidth to enterprises and consumers. Recently this industry has also been entering the solution provider space by providing end to end solutions of connectivity and equipments to enterprises. This sector is growing at break-neck speed with the subscriber base crossing the mark of 680 million. While the user and minutes of usage continue to rise, this sector is facing challenges of falling ARPU (Average Revenue Per User) and RPM (Revenue Per Minute) due to competitive pressures and price wars (e.g. Per-Second Billing Plans). This sector is also likely to play a pivotal role in shaping the Unified Communication market as more and more enterprise users start using mobile phones/smart phones.
Enterprise Communication market is estimated to be around Rs. 20000.000 Millions. and is likely to grow in single digit in next two to three years. The Company continues to maintain leadership position at approximately 25% market share as per leading analysts like Frost and Sullivan, IDC, etc.
Outlook
The Company
continues to be cautiously optimistic about its growth prospects in the new
financial year without compromising focus on profitability and investments for
sustainable growth.
Rs. In Millions
|
Contingent
liabilities in respect of disputed demands of: |
30.09.2010 |
30.09.2009 |
|
(a) Income tax authorities |
182.731 |
155.316 |
|
(b) Excise and Customs authorities |
93.863 |
159.492 |
|
(c) Sales tax matters |
8.744 |
7.898 |
|
(d) Bills Discounted |
0.714 |
39.768 |
UNAUDITED FINANCIAL RESULTS FOR THE QUARTER ENDED 31.12.2010
Rs. In Millions
|
Sr. No |
Particulars |
Standalone
quarter ended 31.12.2010 (Unaudited) |
|
|
|
|
|
1 |
Gross sales/Income from operations |
1250.386 |
|
2 |
Excise duty |
3.837 |
|
3 |
Net sales/Income from operations (1-2) |
1246.549 |
|
4 |
Other Operating Income |
4.233 |
|
5 |
Total Income (3+4) |
1250.782 |
|
6 |
Expenditure |
|
|
|
a) Decrease/(Increase) in stock in trade |
(63.304) |
|
|
b) Consumption of raw materials |
18.150 |
|
|
c) Purchase of traded goods |
741.170 |
|
|
d) Excise duty |
(0.168) |
|
|
e) Employees cost |
207.601 |
|
|
f) Depreciation |
18.636 |
|
|
g) Other expenditure |
239.276 |
|
|
Total expenditure |
1161.361 |
|
7 |
Profit from Operations before Other
income, Interest & Exceptional item (5-6) |
89.421 |
|
8 |
Other Income (Interest) |
13.511 |
|
9 |
Profit before Interest & Exceptional
item (7+8) |
102.932 |
|
10 |
Interest expense |
3.775 |
|
11 |
Profit after Interest but before
Exceptional item (9-10) |
99.157 |
|
12 |
Exceptional item (Note 3) |
- |
|
13 |
Profit (+)/ Loss (-) from Ordinary
Activities before tax (11-12) |
99.157 |
|
14 |
Tax expense |
32.010 |
|
15 |
Net Profit (+)/ Loss (-) from Ordinary
Activities after tax (13-14) |
67.147 |
|
16 |
Extraordinary Items (net of tax expenses) |
- |
|
17 |
Net Profit (+)/ Loss (-) for the period
(15-16) |
67.147 |
|
18 |
Paid-up equity share capital (face value
of Rs. 10 each) |
1423.32 |
|
19 |
Reserves excluding Revaluation Reserves as
per balance sheet of previous accounting year |
|
|
20 |
Basic and diluted EPS (Rs.) (not
annualised) |
4.72 |
|
21 |
Public shareholding : |
|
|
Number of shares |
2970597 |
|
|
Percentage of shareholding |
20.87 |
|
|
22 |
Promoters and promoter group shareholding
: |
|
|
a) Pledged/Encumbered |
|
|
|
Number of shares |
2840622 |
|
|
Percentage of shareholding (as a % of the
total shareholding of promoter and promoter group) |
25.22 |
|
|
Percentage of shareholding (as a % of the
total share capital of the company) |
19.96 |
|
|
b) Non-encumbered |
|
|
|
Number of shares |
8422013 |
|
|
Percentage of shareholding (as a % of the
total shareholding of promoter and promoter group) |
74.78 |
|
|
Percentage of shareholding (as a % of the
total share capital of the company) |
59.17 |
Notes:
1)
The results for the quarter ended 31.12.2010 have
been reviewed by the audit committee and approved by the Board of Directors at
its meeting held on 27.01.2011. These have been subjected to limited review by statutory
auditors of the Company.
2)
Segment Reporting
The Company operates in
one primary business segment that is Business Communication Solutions.
3)
Exceptional item for the year ended 30.09.2010
pertains to profit of Rs. 9.701 millions on sale of land.
4)
During the current quarter, the Company has changed
its revenue recognition policy consistent with practice followed in the
Industry. Had the Company continued with the earlier policy, the Gross Sales/
Income from operations would have been lower by Rs. 128.005 millions and Profit
after Tax would have been lower Rs. 48.322 millions ( Standalone and
Consolidated)
5)
There was no investor complaint pending at the
beginning and at the end of the quarter. Two (2) complaints were received and
disposed of during the quarter.
FIXED ASSETS
·
·
·
Buildings
·
Plant
and Machinery
·
Electrical
Installation
·
Computers
·
Furniture
and Fixtures and Office Equipments
·
Technical Know-how
·
Computer
software
PRESS RELEASE:
AGC NETWORKS WINS AWARD FOR CONTINUOUS INNOVATION IN HR @WORK
AGC Networks Limited, one of
These awards are hosted by the Employer Branding Institute,
along with Stars of the Industry Group and World HRD Congress. The Employer
Branding Institute is a virtual organization which provides a platform for
senior leaders in HR to connect with each other, to share and celebrate the
best practices of organizations in ‘Talent Management, Talent Development and
Talent Innovation.’ The Awards, which originated in the last decade, have been
very active in Europe, parts of
Mr. B.N Jha, Director – HR AGC Networks, who spearheaded AGC’s efforts, received the award. Speaking on the occasion, Jha stated “AGC Networks is honored to receive this award for its ingenious HR practices and the continued commitment towards improvement. Our practices have aspired to get the best talent in the industry and give them what they truly deserve; an effort that was duly recognized and rewarded at this forum”.
This year’s award edition saw 24 countries represented with a total of about 5000 nominations received by the Employer Branding Institute. The many companies which finally won the award in 9 different categories were felicitated for their sustained approach towards HR in benchmarking talent management, deploying human resources best practices and continuous innovation in their respective organizations.
The award process which starts with a call for entries from interested organizations across Asia (for the Asia edition) is a rigorous process of screening the various practices of an organization, rounds of eliminations basis various criteria by the Academic/Professional Council. The final winners are decided by a jury which comprises the who’s who of HR across the world.
About AGC Networks
AGC Networks Limited is India’s leading enterprise communication solution integrator delivering customized business solutions that help organizations accelerate revenue growth, increase market penetration, optimize operating costs and improve employee productivity, by embedding communication in their business processes. With a vision of being a world class solution integrator of choice, AGC Networks Limited has always remained committed to providing clients with the best returns on their technology investments. It partners with global leaders like Avaya, NICE Systems, NEC, Polycom, Plantronics, Extreme Networks, HP and Sony.
CMT REPORT (Corruption, Money Laundering and 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.44.57 |
|
|
1 |
Rs.73.58 |
|
Euro |
1 |
Rs.66.23 |
SCORE and RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
8 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
66 |
This score serves as a reference to assess SC’s credit risk and
to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively below
average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
- |
NB |
New Business |
- |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.