MIRA INFORM REPORT

 

 

Report Date :

07.10.2011

 

 

IDENTIFICATION DETAILS

 

Name :

MAYUR UNIQUOTERS LIMITED

 

 

Registered Office :

Jaipur - Sikar Road, Village Jaitpura, Tehsil : Chomu, District Jaipur – 303 704, Rajasthan

 

 

Country :

India

 

 

Financials (as on) :

31.03.2011

 

 

Date of Incorporation :

14.09.1992

 

 

Com. Reg. No.:

17-006952

 

 

Capital Investment/ Paid-up Capital:

Rs. 54.132 Millions

 

 

CIN No.:

[Company Identification No.]

L18101RJ1992PLC006952

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

JPRM02564C

 

 

PAN No.:

[Permanent Account No.]

AABFM9592L

 

 

Legal Form :

It is a public limited liability company.  The company's shares are listed on the Stock Exchanges. 

 

 

Line of Business :

Manufacturer of synthetic leather

 

 

No. of Employees:

500 (Approximately) (In office + In Factory)

 

 

RATING & COMMENTS

 

MIRA’s Rating :

A (65)

 

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 2400000

 

 

Status :

Good

 

 

Payment Behaviour :

Regular

 

 

Litigation :

Clear

 

 

Comments :

Subject is an established company having fine track. Financial position of the company appears to be sound. Trade relations are reported as fair. Business is active. Payments are reported to be regular and as per commitments.

 

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

 

 

NOTES :

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

 

ECGC Country Risk Classification List – April 1, 2010

 

Country Name

Previous Rating

(31.12.2009)

Current Rating

(01.04.2010)

India

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

INFORMATION PARTED BY

 

Name :

Mr. Sumit

Designation :

Export Manager

Contact No.:

91-1423-224001 / 2

Date :

17.09.2011

 

 

LOCATIONS

 

Registered Office/Factory 1:

Jaipur - Sikar Road, Village Jaitpura, Tehsil : Chomu, District Jaipur – 303 704, Rajasthan, India

Tel. No.

91-1423-224418 / 224302 / 224314/ 224001

Fax No.:

91-1423-2244420

E-Mail :

musystem@sancharnet.in

mlp@mayurgroup.com 

mysystem@jp1.dot.net.in

ssarda@mayur.biz

Website :

http://www.mayuruniquoters.com

 

 

Correspondence Address :

28, 4 Floor, Laxmi Complex, M. I. Road, Jaipur – 302001, Rajasthan, India

Tel No.:

91-141-2361132

Fax No.:

91-141-2365423

E-Mail :

info@mayur.biz

 

 

Head Office :

Rotary Bhawan, Church Road, Jaipur - 302 001, Rajasthan, India

Tel. No.:

91-141-2361132/33

Fax No.:

91-141-2365423/ 2368005

 

 

Corporate Office :

315-316, Namdhari Chambers, 9/54, D. B. Gupta Road, Karol Bagh, New Delhi  - 110 005, India

 

 

Factory 2 :

28, IV Floor, Lakshmi Complex, M I Road, Jaipur – 302 001, Rajasthan, India

Tel. No.:

91-141-2361132 / 2361133 / 2364074 / 2365887 / 5105114

Fax No.:

91-141-2365423 / 2368005

E Mail:

info@mayur.biz

 

 

Branch office :

Shanta Industrial Estate, I. B. Patel Road, Goregaon, Mumbai - 400 063, Maharashtra, India

 

Also Located at

·         Kolkata

·         Delhi

·         Patna 

 

 

DIRECTORS

 

As on 31.03.2011

 

Name :

Mr. Suresh Kumar Poddar

Designation :

Chairman and Managing Director

Address :

81, Southern Avenue, Kolkata - 700 029, West Bengal, India

Qualification :

B. Sc.

Other Directorships

Mayur Leather Products Private Limited  - Chairman

 

 

Name :

Mr. Manav Poddar

Designation :

Whole Time Director

Qualification :

B. Com [Hon.]

 

 

Name :

Mr. Arun Kumar Bagaria

Designation :

Whole Time Director

 

 

Name :

Mr. Rameshwar Pareek

Designation :

Independent Director

Qualification :

B. Com [Hons.] and M.A. [Economics]

Date of Appointment :

30.03.2002

 

 

Name :

Mr. Kanwarjit Singh

Designation :

Independent and Non Executive Director

 

 

Name :

Mr. Ratan Kumar Roongta

Designation :

Independent and Non Executive Director

Date of Appointment:

29.05.2010

 

 

Name :

Mr. Priyavadan Raval

Designation :

Independent and Non Executive Director (upto 30th October 2010)

 

 

Name :

Mr. Ashok Kumar Kejriwal

Designation :

Independent and Non Executive Director (upto 29th May, 2010)

 

 

KEY EXECUTIVES

 

Name :

Mr. Nikhil Saxena

Designation :

Company Secretary  and Compliance Officer

 

 

Name :

Mr. Sumit

Designation :

Export Manager

 

 

Audit Committee:
  • Mr. Rameshwar Pareek (Chairman)
  • Mr. Kanwarjit Singh
  • Mr. Suresh Kumar Poddar
  • Mr. Ratan Kumar Roongta (w.e.f. 17th January, 2011)
  • Mr. Priyavadan Raval (upto 30th October, 2010)

 

 

Remuneration Committee:
  • Mr. Rameshwar Pareek (Chairman)
  • Mr. Kanwarjit Singh
  • Mr. Manav Poddar
  • Mr. Ratan Kumar Roogta (w.e.f. 29th Mary, 2010)
  • Mr. Ashok Kumar Kejriwal (Upto 29th May, 2010)

 

 

Shareholders’ / Investors’ Grievance Committee:
  • Mr. Rameshwar Pareek (Chairman)
  • Mr. Suresh Kumar Poddar
  • Mr. Manav Poddar

 

 

Name :

Mr. Prahalad Sahay Jangid

Designation :

Chief Financial Officer

 

 

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

 

(As on 30.06.2011) 

 

Category of Shareholder

Total No. of Shares

% of total No. of Shares

 

 

 

(A) Shareholding of Promoter and Promoter Group

 

 

(1) Indian

 

 

Individuals / Hindu Undivided Family

4,057,738

74.96

Sub Total

4,057,738

74.96

(2) Foreign

 

 

Total shareholding of Promoter and Promoter Group (A)

4,057,738

74.96

(B) Public Shareholding

 

 

(1) Institutions

 

 

Mutual Funds / UTI

7,900

0.15

Financial Institutions / Banks

2,600

0.05

Sub Total

10,500

0.19

(2) Non-Institutions

 

 

Bodies Corporate

103,398

1.91

Individuals

 

 

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

821,822

15.18

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

281,964

5.21

Any Others (Specify)

137,778

2.55

Clearing Members

2,205

0.04

Non Resident Indians

52,167

0.96

Hindu Undivided Families

83,406

1.54

Sub Total

1,344,962

24.85

Total Public shareholding (B)

1,355,462

25.04

Total (A)+(B)

5,413,200

100.00

(C) Shares held by Custodians and against which Depository Receipts have been issued

-

-

(1) Promoter and Promoter Group

-

-

(2) Public

-

-

Sub Total

-

-

Total (A)+(B)+(C)

5,413,200

100.00

 

 

BUSINESS DETAILS

 

Line of Business :

Manufacturer of synthetic leather

 

 

Products :

Product Description

ITC Code

PVC Bonded Foam

3926.90

Textiles Fabric Impregnated Coated Covered or Laminated with PVC

5903.10

Textile Fabric Impregnated Coated Covered or Laminanted with PU

5903.20

Non Woven Whether or not Impregnated Coated Covered or laminated

5603.00

PVC Sheet Flexible Plain

3920.12

 

·         Footwear

·         Automotive

·         Upholstery / Furnishing

·         Apparel / Garments

·         Luggage / Leather Goods

·         Sports Goods

 

 

Terms :

 

Selling :

L/C, Cash and Credit (30 Days and 60 Days)

 

 

Purchasing :

L/C, Cash and Credit (30 Days and 60 Days)

 

PRODUCTION STATUS

 

(As on 31.03.2011)

 

Unit

As on 31.03.2011

Installed Capacity

Mtrs. P.A.

15600000

Actual Production

Mtrs. P.A.

14126777.01

 

 

Particulars

Unit

Actual Production

Coated Cotton Fabric

Qty (L. Mtrs)

63354.00

Coated Man-Made Fabric

Qty (L. Mtrs)

11784686.21

Coated Non-Woven Fabric

Qty (L. Mtrs)

463972.80

Coated Both Side Fabric

Qty (L. Mtrs)

1680791.40

PVC/PU Sheet/ Paper Board

Qty (L. Mtrs)

133972.60

 

 

GENERAL INFORMATION

 

Customers:

·         Maruti Suzuki

·         Tata Motors

·         TS Tech

·         Honda

·         Bata

·         Chrysler

·         Magna

·         Fort

·         Foamex

·         Lear Corporation

·         Ningbo Jifeng Auto Parts

·         Taj Vinyl

·         Swaraj

·         BSL

·         Krishna Maruti

·         Sharda Motor

·         Sietz Technologies

·         Alpha Foam Limited

·         Mahindra Tractors

·         Sonalika

·         Piaggio

·         LML

·         Nissan

·         Hyundai

·         VKC

·         Liberty Footwear

·         Condor India Private Limited

·         Paragon

·         Lunar's

·         Odyssia

·         Saddles

·         Marvin

·         Carbon Footwear

·         Khadim's

·         Lehar

·         Autoworld

·         Bairathi Footwear

·         Dawar

·         Roadstar Footwear

·         Tulip Enterprises

·         Tej Shoe

·         SRN Enterprises

·         Poddar Footwear

·         Elegant

 

 

No. of Employees :

500 (Approximately) (In office + In Factory)

 

 

Bankers :

·         Canara Bank

·         Andhra Bank, Jaipur, Rajasthan, India

·         IDBI Bank

·         ABN Amro Bank

·         ICICI Bank Limited

·         Standard Chartered Bank

·         HDFC Bank Limited

 

 

Facilities:

Secured Loans

31.03.2011

Rs. in Millions

31.03.2010

Rs. in Millions

Term Loans from Banks

 

 

Canara Bank

38.267

23.608

Andhra Bank

7.125

16.565

IDBI Bank

16.477

0.000

Interest Accrued and Due on Term Loan

0.075

0.000

Working Capital Loans form Banks

 

 

Canara Bank

13.853

0.000

Andhra Bank

0.000

0.000

IDBI Bank

0.000

0.000

Other Loans

 

 

Kotak Mahindra Prime Limited

0.000

0.165

Maruti Udyog Limited, Gurgaon

0.000

1.484

HDFC Limited

1.985

2.400

Total

77.782

44.222

Note:

 

For Term Loans from Banks: Term Loan from banks are secured against mortgage of Land and Building situated at Village- Jaitapura, Jaipur and first charge  on movable and movable assets both present and future situated at Village-Jaitapura,m Jaipur with specific first charge of respective bank on fixed assets financed by them. The term loans are further secured by hypothecation of Raw Material, Work in process and finished goods and other current assets of the company on pari passu basis.

 

For Working Capital Loans: Working Capital Limits from Banks are secured against first charge on all immovable and movable assets of the company situated at Village- jaitapura, Jaipur and further secured by hypothecation of Raw Material, Work in process and finished goods and other current asset of the company on pari passu basis.

 

For other Loans: Term Loans form Banks and other are secured by way of hypothecation  of vehicles financed by them.

 

 

 

Banking Relations :

Satisfactory

 

 

Statutory Auditors :

Madhukar Garg and Company

Chartered Accountant

Address :

2A, Raj Apartment, Keshav Path, Ahinsa Circle, C-Scheme, Jaipur - 303 701, Rajasthan, India

 

 

Internal Auditors :

Kalkani and Associates

Chartered Accountant

Address :

5th Floor, Mile Stonell, Tonk Road, Jaipur-302015, Rajasthan, India

 

 

Associates/Subsidiaries :

AS on 31.03.2008

 

·         Mayur Interlinks (India) Private Limited

Incorporated on 7th December, 1993 at Delhi.  Subject was promoted by Mayur Group of Companies as an International Agency House representing the various foreign companies.

 

Directors

Mr. S. K. Poddar

Mr. R. V. Gupta

Mr. V. K. Aggrawal

Mr. Rajendra K. Poddar

 

·         Mayur Sales

Engaged in manufacturing of high frequency welded door panels for cars, PVC Tarpaulin covers, PVC floor mats, automobile seat covers, etc.

 

Some of its major customers are :

·         Maruti Udyog Limited

·         Telco

·         Bajaj Tempo Limited

·         DCM Toyota

·         Allwyn Nissan

·         Premier Automobiles Limited

·         Auto Interior Industries

 

Engaged in manufacturing of automobile accessories viz. floor mats, embossed velvet and perforated head roof lining for various automobile manufacturers.

 

·         Mayur Industries Limited

 

 

 

 

CAPITAL STRUCTURE

 

As on 31.03.2011

 

Authorised Capital :

 

No. of Shares

Type

Value

Amount

7000000

Equity Shares

Rs.10/- each

Rs.70.000 millions

 

 

Issued, Subscribed & Paid-up Capital :

 

No. of Shares

Type

Value

Amount

5413200

Equity Shares

Rs.10/- each

Rs. 54.132 Millions

 

 

FINANCIAL DATA

[all figures are in Rupees Millions]

 

ABRIDGED BALANCE SHEET

 

SOURCES OF FUNDS

 

31.03.2011

31.03.2010

31.03.2009

SHAREHOLDERS FUNDS

 

 

 

1] Share Capital

54.132

54.132

54.132

2] Share Application Money

0.000

0.000

0.000

3] Reserves & Surplus

555.977

366.392

235.518

4] (Accumulated Losses)

0.000

0.000

0.000

NETWORTH

610.109

420.524

289.650

LOAN FUNDS

 

 

 

1] Secured Loans

77.782

44.222

78.531

2] Unsecured Loans

0.000

0.000

0.000

TOTAL BORROWING

77.782

44.222

78.531

DEFERRED TAX LIABILITIES

19.785

17.479

16.739

 

 

 

 

TOTAL

707.676

482.225

384.920

 

 

 

 

APPLICATION OF FUNDS

 

 

 

 

 

 

 

FIXED ASSETS [Net Block]

313.025

231.471

226.489

Capital work-in-progress

33.513

2.541

4.328

 

 

 

 

INVESTMENT

0.657

0.657

10.137

DEFERREX TAX ASSETS

0.000

0.000

0.000

 

 

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

 

 

 

Inventories
145.538

98.357

69.891

 

Sundry Debtors
315.930

256.273

215.622

 

Cash & Bank Balances
228.253

195.816

57.605

 

Other Current Assets
11.984

7.848

11.206

 

Loans & Advances
40.367

27.465

10.862

Total Current Assets
742.072

585.759

365.186

Less : CURRENT LIABILITIES & PROVISIONS
 

 

 

 

Sundry Creditors
283.289

257.206

173.083

 

Other Current Liabilities
66.973

45.441

29.893

 

Provisions
31.329

35.556

18.244

Total Current Liabilities
381.591

338.203

221.220

Net Current Assets
360.481

247.556

143.966

 

 

 

 

MISCELLANEOUS EXPENSES

0.000

0.000

0.000

 

 

 

 

TOTAL

707.676

482.225

384.920

 

 

 

PROFIT & LOSS ACCOUNT

 

 

PARTICULARS

31.03.2011

31.03.2010

31.03.2009

 

SALES

 

 

 

 

 

Income

2485.563

1647.328

1150.463

 

 

Other Income

21.323

21.918

3.901

 

 

TOTAL                                     (A)

2506.886

1669.246

1154.364

 

 

 

 

 

Less

EXPENSES

 

 

 

 

 

Raw Materials Consumed

1842.502

1201.858

852.996

 

 

Manufacturing Expenses

62.597

47.262

33.569

 

 

Payment to and Provision fro Employees

75.334

60.230

47.402

 

 

Administrative Expenses

43.808

32.912

61.410

 

 

Selling Expenses

75.862

45.897

20.068

 

 

Increase/ Decrease in Stock

[13.578]

[6.517]

15.487

 

 

TOTAL                                     (B)

2086.525

1381.642

1030.932

 

 

 

 

 

Less

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

420.361

287.604

123.432

 

 

 

 

 

Less

FINANCIAL EXPENSES                         (D)

18.638

13.395

12.990

 

 

 

 

 

 

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

401.723

274.209

110.442

 

 

 

 

 

Less/ Add

DEPRECIATION/ AMORTISATION                     (F)

26.741

21.816

15.854

 

 

 

 

 

 

PROFIT BEFORE TAX (E-F)                               (G)

374.982

252.393

94.588

 

 

 

 

 

Less

TAX                                                                  (H)

122.264

90.241

133.963

 

 

 

 

 

 

PROFIT AFTER TAX (G-H)                                (I)

252.718

162.152

60.625

 

 

 

 

 

Add

PREVIOUS YEARS’ BALANCE BROUGHT FORWARD

310.937

197.063

164.925

 

Excess provision for Earlier years

0.021

0.388

0.000

 

 

 

 

 

Less

APPROPRIATIONS

 

 

 

 

 

Transfer to General Reserve

25.100

17.000

6.100

 

 

Interim Dividend

29.773

10.826

8.120

 

 

Proposed dividend

24.359

16.240

10.826

 

 

Difference of dividend for previous year

0.000

0.0000

0.189

 

 

Dividend Distribution Tax

9.022

4.600

3.252

 

BALANCE CARRIED TO THE B/S

475.422

310.937

197.063

 

 

 

 

 

 

EARNINGS IN FOREIGN CURRENCY

 

 

 

 

 

Export Earnings

476.123

167.180

1213.391

 

TOTAL EARNINGS

476.123

167.180

1213.391

 

 

 

 

 

 

IMPORTS

 

 

 

 

 

Raw Materials

687.910

430.597

285.836

 

 

Capital Goods and Spares

74.929

4.337

8.626

 

TOTAL IMPORTS

762.839

434.934

294.462

 

 

 

 

 

 

Earnings Per Share (Rs.)

 

 

 

 

Basic

46.69

29.95

11.94

 

Diluted

46.69

29.95

11.85

 

 

QUARTERLY RESULTS

 

PARTICULARS

30.06.2011

 

 

1st Quarter

Net Sales

695.780

Total Expenditure

599.940

PBIDT (Excl OI)

95.840

Other Income

4.730

Operating Profit

100.570

Interest

0.950

Exceptional Items

0.000

PBDT

99.620

Depreciation

7.610

Profit Before Tax

92.010

Tax

30.970

Provisions and contingencies

0.000

Profit After Tax

61.040

Extraordinary Items

0.000

Prior Period Expenses

0.000

Other Adjustments

0.000

Net Profit

61.040

 

 

KEY RATIOS

 

PARTICULARS

 

 

31.03.2011

31.03.2010

31.03.2009

PAT / Total Income

(%)
10.08

9.71
5.25

 

 
 

 
 

Net Profit Margin

(PBT/Sales)

(%)
15.09

15.32
8.22

 

 
 

 
 

Return on Total Assets

(PBT/Total Assets}

(%)
35.54

30.88
15.99

 

 
 

 
 

Return on Investment (ROI)

(PBT/Networth)

 
0.61

0.60
0.33

 

 
 

 
 

Debt Equity Ratio

(Total Liability/Networth)

 
0.75

0.91
1.03

 

 
 

 
 

Current Ratio

(Current Asset/Current Liability)

 
1.94

1.73
1.65

 

 

LOCAL AGENCY FURTHER INFORMATION

 

CONTINGENT LIABILITIES NOT PROVIDED FOR

 

 

As on 31.03.2011

Rs. in Millions

Letter of Credit

361.889

Demand under disputes Excise Duty

(The company has filed appeal against this demand)  

0.769

Service Tax Demand

2.296

Estimated amount of Contracts remaining to be executed on Capital Account (Net of Advances) 

65.423

 

TRADE REFERENCE

  • Alpha Foam Limited
  • Sharda Motor

 

Check List by Info Agents

Available in Report (Yes / No)

1) Year of Establishment

YES

2) Locality of the firm

YES

3) Constitutions of the firm

YES

4) Premises details

NO

5) Type of Business

YES

6) Line of Business•

YES

7) Promoter’s background

--

8) No. of employees

YES

9) Name of person contacted

YES

10) Designation of contact person

YES

11) Turnover of firm for last three years

YES

12) Profitability for last three years

NO

13) Reasons for variation <> 20%

NO

14) Estimation for coming financial year

NO

15) Capital in the business

YES

16) Details of sister concerns

NO

17) Major suppliers

NO

18) Major customers

YES

19) Payments terms

NO

20) Export / Import details (if applicable)

NO

21) Market information

--

22) Litigations that the firm / promoter

--

23) Banking Details

YES

24) Banking facility details

NO

25) Conduct of the banking account

--

26) Buyer visit details

--

27) Financials, if provided

NO

28) Incorporation details, if applicable

--

29) Last accounts filed at ROC

--

30) Major Shareholders, if available

--

 

 

HISTORY

 

Subject was incorporated as a public limited company in 1992. The company is promoted by the Mayur group with three manufacturing units at Jaipur and an established trading network in synthetic leather. In 1994, the company commenced commercial production of PU/PVC synthetic leather (inst. cap. : six mln linear mtr pa) at Jaitpura, Rajasthan. Its manufacturing unit has plant and machinery imported from Italy. It is also setting up a pilot plant from Italy for R and D development to upgrade finished products and to meet various requirements. The company's product finds application in shoes, garments, luggage, sports goods and upholstery, and is used as a substitute for real/natural leather. The company came out with a public issue in Jun.'94. During the year 1999-2000, the company has explored new markets viz. Sri Lanka, Mauritius and South Africa and has also focussed special efforts in automotive segments resulting in acceptance of company's products by some leading companies in the industry.

 

 

STATE OF COMPANY`S AFFAIRS:

 

After  the very challenging conditions of the fiscal year  2008-09  (FY09),  the domestic economy staged a positive turnaround during the second half of  the  fiscal year FY10 as the result of the targeted stimulus  packages  and  other  timely initiatives taken by the Government, thereby  justifying  the  faith  in  the inherent strengths and resilience of  Indian  economy,  even  though the improved growth trajectory has been accompanied by higher levels  of inflationary outlook.

 

Despite  the  gradual  withdrawal  of  the  stimulus  measures  which  were  introduced  in  fiscal year 2009, private consumption and  investment,  two  important  domestic  demand  drivers  recovered strongly  in  FY11  as  the  confidence of the customer and investor was restored.

 

Expectations  of  the  rapid economic recovery in FY11 were  by  and  large  fulfilled, resulting in the GDP growth of 8.5%.

 

Overall,  the economy finished the year ending 31st March, 2011 on a  solid  footing,  still  one  of the fastest growing economies  globally  and  well  positioned  to attain the high growth trajectory. These factors  helped  in  increasing the household income resulting in higher consumption.

 

Subject being a leader in the synthetic leather  industry  has  been  able  to leverage the emerging  opportunities  in  the  evolving  scenario  of  revival  and renewed growth. The Company  has  delivered  the  exemplary performance in the FY11 with the growth of nearly 51% compared to  the previous year with the net sales of Rs. 2485.563 Millions.

 

The  Company  is leveraging upon lower labour cost as  compared  to  other  competitors in the developed countries and this unleashes an opportunity to  enter  into  high quality conscious European and American markets.  They  are  proud  to  mention here that they have marked the presence in  the  developed  European and American markets.

 

They  are  confident  enough  that with the  low  labour  capital  ratio  and  continuous research and development activities, the Company will  continue  to  increase  the  market share in European and  American  markets  thereby  increasing the profitability.

 

The Company is committed to offer products at the most competitive  prices  while  fulfilling  overall  parameters  defined  by  the  customers.   The  Directors  perceive  that  the business of the Company stands  on  a  sound  platform and is running well. MUL`s business is supported by a strong back- end   in  procurement,  manufacturing,  product  development,   information  technology and human resource Management.

 

 

MANAGEMENT DISCUSSION AND ANALYSIS

 

ECONOMIC OVERVIEW

 

For Indian synthetic leather industry, the Financial Year 2010-2011 (FYI 1) was a year full of opportunities as well as challenges.

 

The economy grew at 8.5 % during FY11, as against 7.4 % during the previous year. Increase in household income resulted in higher consumption and larger investment in the capital market. Still, there are some challenges ahead. Rising inflation has been a cause of serious concern.

 

To keep inflation under control, the RBI has been hawkish on interest front and increased the interest rates on several occasions.

 

It is widely admitted that the country is getting the global recognition as an emerging economic power and a preferred investment destination for the global players. Corporate giants have made sizable overseas acquisitions. Moreover, the visit of the world leaders to India in the short span of time endorses to the above recognition. Further, all visits were supported by the common agenda of closer bilateral trade and cementing business relations. That has made them to believe that there are strong reasons for the spurt of growth in the economy along with enormous opportunities ahead. Indian economy has recovered much faster than other economies of the world. It is expected to gather more momentum in due course, putting the economy back to high growth trajectory.

 

Indian Industry is gearing up to leverage its strengths towards maximizing benefits.

 

OPERATIONAL REVIEW 

 

Though uncertainty prevailed in global market during FY11, however, MUL managed to post one of the best performances as compared to the previous years.

 

MUL is one of the largest manufacturers of Synthetic Leather in India with a capacity of 1.3 million linear meters per month. Export was 17.94% of its total turnover in FY 11. They expect revenue from exports to move up steadily other the next few years and it would largely be driven by sales to overseas automobile OEMs. The Company has started supplying to US auto majors i.e. Ford and Chrysler and is expected to supply to QM and Toyota. Approval process is on with BMW and Mercedes Benz. MUL claims to be one of the first companies from India to develop such products for these auto majors. Besides auto OEMs, general exports would continue to grow to region and countries such as Middle East, UK, Russia, Sri Lanka, Bangladesh, Nepal, China, Mexico , Kuwait.

 

The domestic automobile sector, especially the passenger vehicles, continues to grow very strongly. The strong auto sales growth continues to drive MUL’s sales growth. In automotive OEM space, MUL supplies to companies like Maruti, Honda Motorcycles and Scooters India (P) Limited, Hero Honda, Eicher Motors, MandM, Tata Motors etc.

 

The production during FY11 was 14.13 million linear meters as against 11.98 million linear meters in the previous year. The Company has achieved a turnover of Rs.2691.447 Millions in FYI I against a turnover of Rs. 1761.469 Millions in the year 2009-10(FY1O).

 

Earnings before interest, depreciation and taxes increased to Rs.408.579 Millions in FYI 1 from Rs.280.186 Millions in FY10.

 

Profit after Tax (PAT) went up to Rs. 252.718 Millions in 2010-11 from Rs. 162.152 Millions  in 2009-10.

 

Earning per share (EPS) went up to Rs. 46.69 in 2010-11 from Rs. 29.95 in 2009-10.

 

The strength of the Company’s business strategies and competence has been demonstrated by its spectacular performance during FYI 1.

 

The Turnover of the company has increased by 52.80% from Rs. 1761.469 Millions to Rs. 2691.447 Millions and the production has increased by 17.95 % from 11.98 million linear meter to 14.13 million linear meter . The reason for the high percentage growth in turnover in comparison to production was higher input cost, better price realization, value additions etc.

 

RESEARCH AND DEVELOPMENT

 

MUL lays strong emphasis on the research and development activities and is continuously improving its business by a high quality research and development (R AND D). The Company has laid oit training programs to improve and upgrade skills of its employees to keep pace with the changing market scenario. MUL has continued its focus on its in-house research and development. The R AND D division continues to pay more attention on developing the products to suit customer’s requirements. They have developed special products for automotive OEMs in Europe and USA, which fulfill the world-class quality standards criteria for synthetic leather. The analytical labs and special designed plant and machinery enable them to develop the synthetic leather for General Motors, Chrysler, Ford, Mercedes Benz and BMW in the European and US markets. Continual infusion of new technologies need research activities during its absorption and usage. The Company takes every measure to adopt newer methodologies to develop the new products.

 

In FY lithe R AND D has been made to develop the environment friendly finishes for global OEM market requirements, which will replace conventional solvent based finishes; eliminating the use of chemicals, restricted in the European and US markets. It will ensure replacing with the environment friendly chemicals; developing the new formulations as a measure of cost control and better raw material management. These efforts of the R and D wing have lead them far ahead of its competitors and increased its supplies to the US Automotive OEM Market.

 

The dominance of MUL as a brand in PU/PVC synthetic leather market is likely to increase in the coming years, supported by the buoyancy in domestic as well as global sales, in view of the sustained resilience of sales and

profitability and the ongoing improvement in R AND D.

 

BUSINESS OUTLOOK

 

Consumption growth in India has been outstanding over the last five years across product categories. They expect consumption surge to continue going forward, driven by rising disposable income and improved standard of living. The footwear sector is the largest user industry for MUL’s synthetic leather. Footwear is a large industry and continues to witness significant growth year after year. With ever increasing number of premium brands in footwear, demand for premium synthetic leather is rising faster. MUL supplies to footwear makers like Bata, Action, Liberty, Paragon, VKC group and others. The south Indian footwear makers are also major customers of MUL. Moreover, with the rise in the disposable income of the consumer and due to rapid urbanization, the demand of the footwear industry is increasing which in turn will continue to drive MULs growth.

 

The whole gamut of fashion products including garments, bags and furnishings are not only driving growth but also facilitating margin expansion, as these products require more customization and better quality.

 

Auto replacement market is another significant market segment for the Company. Unlike cyclicality of auto OEM market, the replacement market is a stable market and displays characteristics of a consumer market. Moreover, the consumer of automobile sector in India uses the vehicle for the period of approximately 15 years or so and therefore, creating a great demand in the replacement market. Domestic automobile sector, especially the passenger vehicles, continues to grow strongly and have not shown much cyclicality. The strong auto sales performance will also act as an engine for MUL’s growth.

 

As such, the business outlook seems to be promising. The same can also be seen from the performance of the company in the highly uncertain global market. Apart from increase in domestic sales, the exports have increased by 188.80% from Rs.167.180 Millions in FY10 to Rs.482.802 Millions in FY11. In the current fiscal also, they expect the exports to increase significantly, in view of the successful supplier evaluation and product approval by leading Auto OEMs of the world.

 

FIXED ASSETS

 

·         Land and Site Development

·         Building and Premises

·         Plant and Machinery (Imported)

·         Plant and Machinery (Indigenous)

·         Diesel Generator Set

·         Computers and Peripherals

·         Office and Other Equipments

·         Furniture and Fixtures

·         Vehicles

 

 

AS PER WEBSITE

 

Profile:

 

They were established and started operations in the year 1994 with an installed capacity of 400,000 Linear Meters per month.  The guiding principle of the organization has always been fulfilment of customer requirement and progressive thinking.  With constant human and technological development, the company today stands profitably with an installed capacity of 1.4 Million Linear Meters per month which is fully utilized. They have placed the order for the 4th Coating Line which will increase the capacity, further, to 1.9 Million Linear Meters per month from September 2011.


They have a full range of machinery to fulfill the Printing, Embossing, Lacquering, Sueding and Laminating needs.  The company possesses fully equipped Physical, Chemical and Product Development Laboratories capable of testing nearly all the properties of Artificial Leather for different segments and applications.

Enterprise Resource Planning (ERP) / IT is now a part and parcel of all functions in the company and with constant persistence, the organization has understood and also finds it a better way to stay organized, improve productivity, communicate faster within the organization and ensure product and process traceability from start to end. They have been certified with ISO 9001:2008 (Quality Management System) which is demonstrative of the commitment towards continual improvement.

 

 

BOARD OF DIRECTORS:

 

Mr. Suresh Kumar Poddar ( Age – 64 )

Chairman and Managing Director.

 

A B.Sc, Science Graduate, he promoted the company in 1994 and has marvelous entreprenual skills and is a veteran in the field of Artificial Leather / PVC Vinyl. Before starting his own manufacturing he was a trader of Artificial Leather in the Kolkatta for 25 years and has brought into the company his rich experience. Under his leadership the company has gone from strength to strength and today is the leading Vinyl supplier in the country.

 

 

Mr. Manav Poddar ( Age – 36 )

Excecutive Director.

 

A B.Com Hons, Commerce Graduate, he is the son of Mr. Suresh Kumar Poddar. He joined the company on the 1st of November, 2002, and has to his credit 16 years of experience in General Management. For the first couple of years of his career he worked in various group companies of Mayur and gained hands - on experience in all functions of an organization. Today his focus is mainly on TQM (Total Quality Management) and wants to see the company go the Japanese way for Quality, Productivity and overall Management.

 

Mr. Arun Kumar Bagaria ( Age – 38 )

Excecutive Director.

 

A MBA in Marketing from U.K, he is the son – in – law of Mr. Suresh Kumar Poddar. He joined the company in 2007 and has 11 years of experience mainly in commercial activities and general management also.

 

Mr. Kanwarjit Singh (Age – 70)

Independent and Non – Excecutive Director.

 

A Masters in Mathematics and Physical Studies from U.K, he is a well known Tax and Financial Adviser. He was appointed as an Independent Director in the company in 2007. He is a veteran in the field of Taxation and has rendered his services to the Government of India as Chief Commissioner of Income Tax, however, retired currently. He has served at very senior positions in Public Sector Banks and Public Sector Trading Houses and has considerable experience in Auditing and Law Departments. He doesn’t hold any shares in the company.

 

Mr. Rameshwar Pareek ( Age – 66 )

Independent and Non – Excecutive Director.

 

A B.Com Hons., Commerce Graduate and M.A in Economics he retired as General Manager in Rajasthan Finance Corporation. He holds rich industrial exposure as he worked in the Bureau of Industrial Promotion also. He is, therefore, fully conversant with the working of Govt. Departments and the Industry. He doesn’t hold any shares in the company.

 

Mr. Ratan Kumar Roongta ( Age – 62 )

Independent and Non – Executive Director.

 

A Masters in Commerce ( Financial Management ) and a JAIIB (Junior Associate of Indian Institute of Banking and Finance). He has handled diverse assignments in various leading banks in the country at very senior positions like Regional and Zonal Head. His expertise and experience lies in the areas of Banking, Finance, Risk Assessment, Corporate Governance and Information Technology. He doesn’t hold any shares in the company

 

 

 

CMT REPORT (Corruption, Money Laundering & Terrorism]

 

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

 

1]         INFORMATION ON DESIGNATED PARTY

No records exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

 

2]         Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

 

3]         Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

 

4]         Record on Financial Crime :

            Charges or conviction registered against subject:                                                              None

 

5]         Records on Violation of Anti-Corruption Laws :

            Charges or investigation registered against subject:                                                          None

 

6]         Records on Int’l Anti-Money Laundering Laws/Standards :

            Charges or investigation registered against subject:                                                          None

 

7]         Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

 

8]         Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

 

9]         Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

 

10]        Press Report :

            No press reports / filings exists on the subject.

 

 

CORPORATE GOVERNANCE

 

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

 

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

 

 

CONTRAVENTION

 

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.49.19

UK Pound

1

Rs.75.92

Euro

1

Rs.65.44

 

 

SCORE & RATING EXPLANATIONS

 

SCORE FACTORS

 

RANGE

POINTS

HISTORY

1~10

8

PAID-UP CAPITAL

1~10

7

OPERATING SCALE

1~10

6

FINANCIAL CONDITION

 

 

--BUSINESS SCALE

1~10

8

--PROFITABILIRY

1~10

8

--LIQUIDITY

1~10

7

--LEVERAGE

1~10

7

--RESERVES

1~10

8

--CREDIT LINES

1~10

6

--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

NO

--AFFILIATION

YES/NO

YES

--LISTED

YES/NO

YES

--OTHER MERIT FACTORS

YES/NO

YES

TOTAL

 

65

 

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                 Payment record (10%)

Credit history (10%)                    Market trend (10%)                                Operational size (10%)

 

 

RATING EXPLANATIONS

 

 

RATING

STATUS

 

 

PROPOSED CREDIT LINE

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

 

Large

56-70

A

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

 

Fairly Large

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

 

Small

11-25

Ca

Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity

 

Limited with full security

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

 

Credit not recommended

-

NB

                                       New Business

-

 

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.