MIRA INFORM REPORT

Report Date :

24.05.2011

IDENTIFICATION DETAILS

Name :	SIEMENS (PAKISTAN) ENGINEERING COMPANY LTD

Registered Office :	B-72, Estate Avenue, Sindh Industrial Trading Estate, Karachi - 75700

Country :	Pakistan

Financials (as on) :	30.09.2010

Year of Establishment :	1953

Com. Reg. No.:	0000617

Legal Form :	Public Limited Company

Line of Business :	execution of projects under contracts and in the manufacture, installation and sale of electronic and electrical capital goods

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Good

Payment Behaviour :	No Complaints

Litigation :	Clear

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 – March 31^st, 2011

Country Name

Previous Rating

(31.12.2010)

Current Rating

(31.03.2011)

Pakistan

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

Business Name

SIEMENS (PAKISTAN) ENGINEERING COMPANY LTD

Full Address

Registered Address

B-72, Estate Avenue, Sindh Industrial Trading Estate, Karachi - 75700, Pakistan

Tel #	92 (21) 32574910 - 19 (9 Lines)
Fax #	92 (21) 32566218
Website	www.siemens.com.pk

Short Description Of Business

a.	Nature of Business	Company is principally engaged in execution of projects under contracts and in the manufacture, installation and sale of electronic and electrical capital goods.
b.	Year Established	1953
c.	Registration #	0000617

Regional Offices

In Karachi, Lahore, Islamabad, Quetta & Peshawar.

Legal Status

The Company is incorporated in Pakistan as a public limited company and its shares are quoted on the Karachi, Islamabad and Lahore Stock Exchanges.

Auditors

Ernst & Young Ford Rhodes Sidat Hyder

(Chartered Accountants)

Details of Chairman / Directors

Names

Designation

Mr. Syed Babar Ali

Mr. Sohail Wajahat H. Siddiqui

Mr. Joerg Steinhaeuser

Mr. Dietmar Siersdorfer

Mr. Bahauddin Khan

Mr. Christian Knie

Dr. Udo Niehage

Chairman

Chief Executive Officer

Director

Categories of Shareholders

Categories

Percentage (%)

Directors, Chief Executive Officer and their spouse and minor children

Associated Companies, Undertakings and Related parties

NIT & ICP

Banks, Development Financial Institutions & Non Banking Financial Institutions, Modarbas and Mutual Funds

Insurance Companies

Public Sector Companies & Corporations

Individuals

Others

0.01

66.10

12.64

14.82

2.93

0.08

2.67

0.75

Associated Companies

(1) Siemens AG, Germany.

Note:

Siemens AGs other investments in Pakistan are as under :

· Telephone Industries of Pakistan (Pvt.) Limited, Haripur.

· Carrier Telephone Industries (Pvt.) Limited, Islamabad.

· Rousch (Pakistan) Power Limited, Abdul Hakim

Products/Services

Manufacture & Marketing of Communication Equipments, Dental Equipment & Instruments, Electric Circuit Breakers All Sorts, Electric Motor Controls, Electric Motors, Electric Power Transmission, Electric Switchboards, Electric Transformers, Electric Panels & Distribution Boards, Electrical Switchgears, Hospital Equipment & Supplies, Industrial Instrumentation, Telecommunication Systems, Ultrasound Equipments, Uninterruptible Power Supply UPS, Mobile Phone Mfrs./Distributors, Solar Power Equipment, Traffic Control Systems.

Number of Employees

1,480

Plant Capacity & Actual Production

Products	Capacity	Actual Production 2010	Actual Production 2009
Electric Motors & Alternators	150,000 HP	116,044 HP	80,845 HP
Motors control gears and control boards	1,000 Nos.	33 Nos.	51 Nos.
Electric transformers	3,000 MVA	2,608 MVA	2,585 MVA
Generating sets	95,000 KVA	10,000 KVA	123,537 KVA
Switchgears and distribution boards	4,500 Nos.	3,613 Nos.	5,228 Nos.

Note:

The under utilisation of capacity is mainly attributed to reduced demand owing to imports by private and public sectors. Due to increased demand, the production of Electric transformers and Generating sets, is above their normal capacity, which was achieved through extra shift working.

Annual Sales Volume

Years

In Pak Rupees

2009

2010

36,149,390,000/-

26,248,842,000/-

Customers

(Local)

(1) ICI Polyester Ltd.

(2) Packages Limited.

(3) Shakarganj Sugar Mills Limited.

(4) United Sugar Mills Ltd.

(5) Dandot Cement Ltd.

(6) Century Paper Mills Ltd.

(7) Pakistan Petroleum Ltd.

(8) Lever Brothers Limited.

(9) Japan Power Generation Ltd.

(10) Lasmo Oil.

(11) Engro NPK Fertilizers.

(12) ICI Power Generation.

(13) Southern Electric Power Co Ltd.

(14) Fecto Cement Company Limited.

(15) Squibb Pharmaceutical Company.

(16) KAPCO.

(17) Dawood Hercules Limited.

(18) Bosicor Pakistan Limited.

(19) Karachi Electric Supply Corporation.

Bankers

· The Royal Bank of Scotland, Pakistan.

· Citibank N.A., Pakistan.

· Deutsche Bank AG, Pakistan.

· Habib Bank Limited, Pakistan.

· HSBC Bank Middle East Limited, Pakistan.

· Meezan Bank Limited, Pakistan.

· MCB Bank Limited, Pakistan.

· Standard Chartered Bank, Pakistan.

National Economy

The national economy experienced further deterioration in comparison to the corresponding year. The stress on macroeconomic stability mainly emanated from unsustainable balance of payment position and the falling value of rupee, escalating food and non-food inflation, and structural problems like power shortages resulting in perceptible slowdown in economic activity. The domestic and regional socio political upheavals and rapidly changing global economic environment added to multifaceted problems. The wide spread devastation of flood would lead to missing this year’s GDP target of 4.5% and the government’s already depleted coffers may be further strained by the crisis. Initial estimates state that the fiscal deficit may rise to as much as 8% of the GDP. The floods have destroyed crops worth around $1 billion including much of the country’s main exports like rice, cotton and sugarcane. Nature’s fury may also add to Pakistan’s inflationary woes. Consumer prices eased a bit in July, rising 12.34% year-on-year compared to 12.69% in June, but the worst may be yet to come. The government has cut down massively in development funds and capital expenditure and we expect that it would have impact on the Company’s business in the years to come.

Contribution to National Exchequer

The company has contributed Rs 2,137 million to the National Exchequer during the period in the form of taxes, duties and other contributions. These contributions form 8% of Company’s turnover.

Foreign Exchange Rates

Currency	Unit	Pakistani Rupees
US Dollar	1	Rs. 86.00
UK Pound	1	Rs. 139.30
Euro	1	Rs. 121.20

Financial Position

Extremely sound

Comments

Subject Company enjoys excellent credibility in Pakistan as well as in abroad. Chairman & directors of the company are resourceful and experienced businessmen. Payments are reported as correct. Company can be considered good for normal business dealings at usual trade terms and conditions.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.45.28
UK Pound	1	Rs.73.30
Euro	1	Rs.63.61

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 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%)

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