MIRA
INFORM REPORT
|
Report Date : |
22.10.2011 |
IDENTIFICATION DETAILS
|
Name : |
JVL AGRO INDUSTRIES LIMITED |
|
|
|
|
Registered
Office : |
Jhunjhunwala Bhavan, Nati Imili Varanasi-221001, Uttar Pradesh |
|
|
|
|
Country : |
India |
|
|
|
|
Financials (as
on) : |
31.03.2011 |
|
|
|
|
Date of
Incorporation : |
17.11.1989 |
|
|
|
|
Com. Reg. No.: |
20-011396 |
|
|
|
|
Capital Investment
/ Paid-up Capital : |
Rs. 128.400 Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
L15140UP1989PLC011396 |
|
|
|
|
TAN No.: [Tax Deduction &
Collection Account No.] |
ALDJ00217A |
|
|
|
|
PAN No.: [Permanent Account No.] |
AAACJ5704B |
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|
|
|
Legal Form : |
Public Limited Liability Company. The Company Shares are Listed to the
Stock Exchange |
|
|
|
|
Line of Business
: |
Subject is engaged in the production of vanaspati, refined oil,
mustard oil, DOC and trading of goods. |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba (47) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
Maximum Credit Limit : |
USD 9600000 |
|
|
|
|
Status : |
Satisfactory |
|
|
|
|
Payment Behaviour : |
Usually Correct |
|
|
|
|
Litigation : |
Clear |
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|
|
|
Comments : |
Subject is an established company having satisfactory track. Trade relations
are reported as fair. Business is active. Payments are reported to be usually
correct and as per commitments. 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.
ECGC Country Risk Classification List – September 30, 2011
|
Country Name |
Previous Rating (30.06.2011) |
Current Rating (30.09.2011) |
|
India |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
LOCATIONS
|
Registered Office : |
Jhunjhunwala Bhavan, Nati Imili Varanasi-221001, Uttar Pradesh, India |
|
Tel. No.: |
91-542-2211312/13 |
|
Fax No.: |
91-542-2210480 |
|
E-Mail : |
|
|
Website : |
|
|
|
|
|
Factory 1 : |
Village Naupur, P.O. Thanagaddhihe, Kerakat, District Janupur, Uttar
Pradesh, India |
|
Tel. No.: |
91-542-2625332 |
|
Fax No.: |
91-542-2625332 |
|
|
|
|
Branch Office : |
Located At: ·
Kolkata ·
Mumbai ·
Delhi |
DIRECTORS
AS ON 31.03.2011
|
Name : |
Mr. D. N. Jhunjhunwala |
|
Designation : |
Chairman |
|
Date of Birth/Age : |
02.02.1936 |
|
Qualification : |
B. Sc (Industrial Chemistry) |
|
Experience : |
Industrialist • Mr. D. N.
Jhunjhunwala is the Chairman of the Company. He is a graduate in Industrial
Chemistry. He has 50 years of experience in various facets of management, out
of which 30 years were dedicated in various oil industries • Mr. D. N.
Jhunjhunwala promoted Jhunjhunwala Vanaspati Limited in 1989 and he was
President of Solvent Extractors Association, member of U.P. Oil Millers
Association, member of Vegetable Oil Refiners Association of India and he is
also involved with various philanthropic activities. He has written many
books on social and religious topics. |
|
Date of Appointment : |
17.11.1989 |
|
|
|
|
Name : |
Mr. S. N. Jhunjhunwala |
|
Designation : |
Managing Director |
|
Date of Birth/Age : |
24.04.1957 |
|
Qualification : |
B.Com |
|
Experience : |
Industrialist • Mr. S. N.
Jhunjhunwala is the Managing Director and is a Commerce graduate. He has 28
years of experience in solvent extraction, oil refining and vanaspati
manufacturing units. |
|
Date of Appointment : |
17.11.1989 |
|
|
|
|
Name : |
Mr. Adarsh Jhunjhunwala |
|
Designation : |
Wholetime Director |
|
Date of Birth/Age : |
05.07.1983 |
|
Qualification : |
Chartered Accountant and MBA (Finance). |
|
Experience : |
Commerce and Financial Accounting • Mr. Adarsh Jhunjhunwala is a Whole time Director of the Company. |
|
Date of Appointment : |
02.02.2007 |
|
|
|
|
Name : |
Mr. H. L. Agrawal |
|
Designation : |
Director |
|
Date of Birth/Age : |
01.08.1927 |
|
Qualification : |
BA, LLB |
|
Experience : |
Legal • Sri H. L.
Agarwal is a Director and an ex-Administrative Judge of Honorable Patna High
Court and retired Chief Justice of Honorable Orissa High Court. He has
extensive experience in the field of legal matters. He looks after all the
legal affairs of the Company |
|
Date of Appointment : |
01.06.1992 |
|
|
|
|
Name : |
Dr. S. K. Dikshit |
|
Designation : |
Director |
|
Date of Birth/Age : |
01.07.1946 |
|
Experience : |
• Mr. S. K. Dikshit is a Director of the Company. He is a Doctor. • He has expertise in herbal products and medical science. |
|
Date of Appointment : |
10.07.2011 |
|
|
|
|
Name : |
Mr. Mahesh Kedia |
|
Designation : |
Director |
|
Date of Birth/Age : |
13.06.1963 |
|
Qualification : |
B. Sc (Statistics), C.A |
|
Experience : |
Commerce and Financial Accounting • Shri Mahesh Kedia is a Director, Chartered Accountant and a Science
graduate |
|
Date of Appointment : |
29.12.2003 |
|
|
|
|
Name : |
Mr. Kanhaiya Lal Goenka |
|
Designation : |
Director |
|
Date of Birth/Age : |
03.03.1979 |
|
Qualification : |
B. Com |
|
Experience : |
Experience in solvent extraction, oil refining and vanaspati
manufacturing units. |
|
Date of Appointment : |
27.02.2007 |
KEY EXECUTIVES
|
Name : |
Mr. Rohit Kumar Jaiswal |
|
Designation : |
Company Secretary |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
AS ON 30.09.2011
|
Category of
Shareholder |
Total No. of
Shares |
a % of total No.
of Shares |
|
|
|
|
|
|
|
(1) Indian |
|
|
|
|
|
23,184,000 |
18.05 |
|
|
Bodies Corporate |
40,406,900 |
31.46 |
|
|
Sub Total |
63,590,900 |
49.51 |
|
|
(2) Foreign |
|
|
|
|
|
63,590,900 |
49.51 |
|
|
(B) Public
Shareholding |
|
|
|
|
(1) Institutions |
|
|
|
|
Financial Institutions / Banks |
79,000 |
0.06 |
|
|
|
22,504,680 |
17.52 |
|
|
Sub Total |
22,583,680 |
17.58 |
|
|
(2)
Non-Institutions |
|
|
|
|
Bodies Corporate |
21,869,757 |
17.03 |
|
|
|
|
|
|
|
Individual shareholders holding nominal share capital up to Rs. 0.100
million |
15,302,391 |
11.91 |
|
|
Individual shareholders holding nominal share capital in excess of Rs.
0.100 million |
3,081,536 |
2.4 |
|
|
Any Others
(Specify) |
2,011,736 |
1.57 |
|
|
|
1,700,000 |
1.32 |
|
|
Non Resident Indians |
311,736 |
0.24 |
|
|
Sub Total |
42,265,420 |
32.91 |
|
|
Total Public
shareholding (B) |
64,849,100 |
50.49 |
|
|
Total (A)+(B) |
128,440,000 |
100 |
|
|
(C) Shares held by
Custodians and against which Depository Receipts have been issued |
- |
- |
|
|
(1) Promoter and Promoter Group |
- |
- |
|
|
(2) Public |
- |
- |
|
|
|
- |
- |
|
|
Total
(A)+(B)+(C) |
128,440,000 |
- |
BUSINESS DETAILS
|
Line of Business : |
Subject is engaged in the production of vanaspati, refined oil,
mustard oil, DOC and trading of goods. |
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|
Products : |
|
PRODUCTION STATUS AS ON 31.03.2011
|
Particulars |
Unit |
Installed
Capacity |
Actual
Production |
|
Vanaspati |
MT per annum |
84000 |
124570.52 |
|
Tins |
Pcs per annum |
42 Lac |
-- |
|
Deacidified Oil |
MT per annum |
132000 |
-- |
|
HDPE JARS |
Pcs per annum |
18 Lac |
-- |
|
Fatty Distillation |
MT per annum |
60000 |
-- |
|
Gasification |
NM3 per annum |
5328000 |
-- |
|
Red Palmolien and Enter Esterified |
MT per annum |
90000 |
-- |
|
Edible Oil (Alwar, Rajasthan) |
MT per annum |
81000 |
-- |
|
Refined Oils / Vanaspati (Pahleza, Bihar) |
MT per annum |
150000 |
125293.54 |
|
Fatty Acid Oil |
MT |
-- |
12823.15 |
|
Mustard Oil |
MT |
-- |
41483.70 |
|
DOC |
MT |
-- |
72321.70 |
Notes:
1)
Shortage, Damages and Discarded of Vanaspati during
the year 2.750 MT (3.036 MT) and Refined Oil 1.500 MT (2.530 MT) and Mustard Oil
1.100 MT (1.225 MT)
2)
Quantity including internal transfer of Ref Oil
798.309 MT (1471.50 MT) & Mustard 747.610 MT (798.831 MT)
GENERAL INFORMATION
|
Bankers : |
·
Bank of Baroda ·
Punjab National Bank ·
State Bank of India ·
State Bank of Bikaner and Jaipur ·
State Bank of Hyderabad ·
State Bank of Patiala ·
State Bank of Travancore ·
Vijaya Bank |
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Facilities : |
|
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Audit Committee : |
Mr. D. N. Jhunjhunwala Dr. S. K. Dikshit Mr. Mahesh Kedia |
|
|
|
|
Statutory
Auditors : |
Garg and Company Chartered Accountants |
|
Address : |
27A, Waterloo Street, Kolkata 700069, West Bengal, India |
|
|
|
|
Related Party : |
·
Jhunjhunwala Gases (Private) Limited ·
Jhunjhunwala Oil Mills Limited ·
Nilambar Trexim and credit Private Limited ·
Jhunjhunwala Sewa Society ·
JVL Overseas Pte. Limited |
CAPITAL STRUCTURE
AS ON 31.03.2011
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
200000000 |
Equity Shares |
Rs.1/- each |
Rs. 200.000 Millions |
|
5000 |
10% Cumulative Redeemable
Preference Shares |
Rs. 100/- each |
Rs. 0.500 Million |
|
250000 |
Cumulative Redeemable
Preference Shares |
Rs. 100/- each |
Rs. 25.000 Millions |
|
|
Total |
|
Rs. 225.500
Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
128440000 |
Equity Shares |
Rs.1/- each |
Rs. 128.400
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 |
128.400 |
128.400 |
251.100 |
|
|
2] Preferential Warrant |
190.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
2102.100 |
1631.900 |
978.200 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
2420.500 |
1760.300 |
1229.300 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
1305.500 |
2953.800 |
2065.100 |
|
|
2] Unsecured Loans |
180.100 |
450.000 |
250.000 |
|
|
TOTAL BORROWING |
1485.600 |
3403.800 |
2315.100 |
|
|
DEFERRED TAX LIABILITIES |
199.700 |
183.000 |
149.100 |
|
|
|
|
|
|
|
|
TOTAL |
4105.800 |
5347.100 |
3693.500 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
1687.700 |
1384.800 |
1108.000 |
|
|
Capital work-in-progress |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
INVESTMENT |
197.200 |
90.900 |
82.000 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
3115.900
|
2239.300 |
1350.300 |
|
|
Sundry Debtors |
1208.000
|
994.000 |
735.000 |
|
|
Cash & Bank Balances |
3327.700
|
2978.800 |
2547.800 |
|
|
Other Current Assets |
0.000
|
0.000 |
0.000 |
|
|
Loans & Advances |
966.600
|
959.700 |
581.700 |
|
Total
Current Assets |
8618.200
|
7171.800 |
5214.800 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
6034.200
|
2937.200 |
2413.700 |
|
|
Other Current Liabilities |
168.700
|
173.400 |
175.200 |
|
|
Provisions |
194.400
|
189.800 |
122.400 |
|
Total
Current Liabilities |
6397.300
|
3300.400 |
2711.300 |
|
|
Net Current Assets |
2220.900
|
3871.400 |
2503.500 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
4105.800 |
5347.100 |
3693.500 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
|
SALES |
|
|
|
|
|
|
|
Sales |
21807.900 |
12341.400 |
13821.200 |
|
|
|
Other Income |
61.300 |
104.900 |
93.700 |
|
|
|
TOTAL (A) |
21869.200 |
12446.300 |
13914.900 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of Materials |
19841.200 |
10772.700 |
12462.400 |
|
|
|
Manufacturing Expenses |
1501.300 |
1049.500 |
950.600 |
|
|
|
Administrative Expenses |
48.900 |
36.200 |
41.500 |
|
|
|
Selling and Distribution Expenses |
77.000 |
47.200 |
94.600 |
|
|
|
Increased / Decrease in Stock |
(275.00) |
(90.500) |
(106.200) |
|
|
|
Withdrawn from Capital Reserve, Subsidy during the year |
(185.600) |
0.000 |
0.000 |
|
|
|
TOTAL (B) |
21007.800 |
11815.100 |
13442.900 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
861.400 |
631.200 |
472.000 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
175.000 |
181.700 |
82.100 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
686.400 |
449.500 |
389.900 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
86.100 |
65.100 |
39.300 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
600.300 |
384.400 |
350.600 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
100.100 |
92.200 |
92.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
500.200 |
292.200 |
258.600 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
1082.600 |
833.300 |
608.500 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
40.000 |
25.000 |
25.000 |
|
|
|
Transfer to Capital Reserve |
139.000 |
0.000 |
0.000 |
|
|
|
Provision for Final Dividend |
25.700 |
15.300 |
7.500 |
|
|
|
Tax on Dividend |
4.300 |
2.600 |
1.300 |
|
|
BALANCE CARRIED
TO THE B/S |
1373.800 |
1082.600 |
833.300 |
|
|
|
|
|
|
|
|
|
|
EXPORT VALUE |
0.000 |
34.800 |
114.000 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
16546.100 |
8527.700 |
10259.300 |
|
|
TOTAL IMPORTS |
16546.100 |
8527.700 |
10259.300 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
|
|
|
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2011 |
|
|
1st
Quarter |
|
Net Sales |
6122.500 |
|
Total Expenditure |
5880.000 |
|
PBIDT (Excl OI) |
242.500 |
|
Other Income |
6.000 |
|
Operating Profit |
248.500 |
|
Interest |
33.600 |
|
Exceptional Items |
0.000 |
|
PBDT |
214.900 |
|
Depreciation |
25.000 |
|
Profit Before Tax |
189.900 |
|
Tax |
28.500 |
|
Provisions and contingencies |
0.000 |
|
Profit After Tax |
161.400 |
|
Extraordinary Items |
0.000 |
|
Prior Period Expenses |
0.000 |
|
Other Adjustments |
0.000 |
|
Net Profit |
161.400 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
PAT / Total Income |
(%) |
2.29
|
2.35 |
1.86 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
2.75
|
3.11 |
2.54 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
5.82
|
4.49 |
5.54 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.25
|
0.22 |
0.29 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
3.34
|
3.91 |
4.21 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.35
|
2.17 |
1.92 |
LOCAL AGENCY FURTHER INFORMATION
PERFORMANCE IN THE YEAR 2010-11
In the financial year
2010-11, the Company performed unexpectedly. The Company crossed its top line
target of
Rs. 18000.000
millions. The total revenue of the financial year 2010-11 is Rs.21807.900
millions which was Rs.12341.400 millions in the financial year 2009-10. There
is a growth of 77%. The revenue of all the four quarters of 2010-11 surpassed
the corresponding period of the last financial year 2009-10. As far as the
half-yearly trend is concerned, the turnover of the Company for the first half
year period ended as on September 30, 2010 almost touched the total turnover of
the financial year 2009-10. We can clearly see that the Company performed
tremendously in the financial year 2010-11. Profit after tax has also gone up
from Rs. 292.200 millions to Rs.500.200 millions from the year 2009-10 to
2010-11. EBIDTA for the year 2009-10 was Rs.631.200 millions and increased to
Rs.861.400 millions in year 2010-11 i.e. by 36%.
CURRENT PERFORMANCE
During the three-month
period ended June 30, 2011, the Company achieved a turnover of Rs.6122.500
millions as compared with Rs.4691.200 millions during the corresponding period
in the previous financial year, in percentage there is a growth of 31%. The PAT
increased by 47% while the EBIDTA increased by 33%. This has been its
historical performance. The Company is moving aggressively on its sales and
marketing efforts and reaching out to bigger population in line with its plan
to become a pan-India company by 2015. It continues to follow the policy of
perpetual technological up gradation. The Company is ISO 9001:2008-certified in
recognition of the organization’s quality system.
EXPANSION PLANS
The Company is
focusing on its 1,200 MT Haldia unit to get it started by the end of this year.
This project is expected to contribute and strengthen the position of the
Company in the national edible oil sector and enhance the presence of the
Company in the eastern, North-Eastern and central markets of India.
This will be the biggest
and technologically most advanced project of the company. The company already
has an existing network of sales and distribution in Eastern and Northeastern
market and will be able to leverage that in selling the output of the Haldia
unit under its brand.
The Company is
expanding its seed crushing capacity at Alwar, Rajasthan to meet growing demand
of its mustard oil and for lesser dependence on outside parties for solvent
extraction plant. This will also help in improvising on cost and bringing technology
up gradation, plant and machinery order are being placed and the company plans
to start the new plant before the next season of mustard crop in March, 2012.
The Company
acquired 500 acres of land in Bihar for further agro-related up gradation activities,
as part of its plan to enter into other commodities in which the Company can
leverage its existing sales and distribution network.
Central India
being the most thickly populated part of the country, the Company wants to be a
formidable force in the agro and related sectors along with its plan to grow in
the edible oil space.
MANAGEMENT DISCUSSION AND ANALYSIS
GLOBAL ECONOMY
The global economy
grew at a robust 4.8% in 2010 against -2.9% in 2009. Advanced economies sustained
their moderate growth owing to strongerthan-expected consumption in the US and
Japan. Private consumption, which fell sharply during the crisis, strengthened
in major advanced economies. Growth in emerging and developing economies
remained robust, buoyed by well-entrenched private demand, facilitative policy
stances and resurgent capital inflows. Going ahead, global GDP growth is
projected to increase by over 3% in 2011 with developing economies expanding
over 6%, more than twice the 2.4-2.7% growth expected for advanced economies.
This growth should give an impetus to consumption, resulting in opportunities
for the edible oil sector.
INDIAN ECONOMY
India’s GDP grew
at a healthy 8.6% in 2010-11 (8% during 2009-10) primarily driven by a
significant rise in agricultural sector contribution.
The index for six
core industries (crude oil, petroleum refinery products, coal, electricity,
cement and finished carbon steel) with a combined weight of 26.68% in the Index
of Industrial Production (IIP) grew 5.6% during April- January 2010-11 compared
with a growth of 5.5% achieved during the corresponding period in 2009-10.
OUTLOOK
Given the strong
underlying economic momentum, outlook is encouraging towards a sustained services
sector growth, normalisation in agricultural output and strengthening private
consumption. Further, the substantial government thrust on infrastructure
projects and development is expected to witness sustained growth, propelling
industrial sector growth. The pace of economic activity is expected to rise
with GDP expected to grow at 8-8.5% in 2011-12 as private demand gathers
momentum and supports overall growth
INDIAN EDIBLE OIL INDUSTRY
Indian edible oil
demand grew steadily at 4.5% CAGR over the last decade and is projected at 16.2
mn MT for 2010-11. This growth was spearheaded by per capita consumption
improvement attributed to an increase in income levels and living standards.
However, India’s current per capita consumption level (14 kg/year for 2010-11
compared with 13.3 kg in 2009-10) is lower than the global average (24
kg/year). The Indian edible oils market continues to be under-penetrated but
positive macro and demographic fundamentals will support and enhance demand
growth.
Palm, soyabean and
mustard oil are the three most consumed Indian edible oils with respect to
volumes, having a
46%, 16% and 14%
share respectively in total oil consumed in 2010. Given the fact that Indian
consumers are price sensitive with different preferences, these oil varieties
are expected to continue to account for the country’s bulk edible oil
consumption.
There exists an
ever-widening gap between demand-supply of edible oil, owing to limited oil
seed availability and a shift in land use for growing other crops in India.
This gap was bridged by imports, accounting for around 45-50% of the total oil
consumed. However, in the first half of 2010-11, edible oil imports were at a
three-year low owing to an improvement in Indian oilseed production. Further, a
higher dependence on imported oil is projected due to domestic supply
constraints and the cost competitiveness of imported oil. Refined and crude
palm oil (CPO) accounted for a significant portion of Indian edible oil imports
owing to relatively low prices and sufficient availability. Palm oil is
expected to dominate imports in the near-to medium-term.
DEMAND SCENARIO
Indian edible oil
demand witnessed a 4.5% CAGR over the last decade and is projected at 16.2 mn
MT for 2010-11. India has an important role to play in the global edible oil
market, accounting for 10.2% of the consumption share, 7% of oilseed production
share, 5% of edible oil production share and 13.6% of global edible oil imports
share for oil year 2009-10. According to USDA estimates, India is the world’s
third-largest edible oil consumer (after China and the EU), expected to account
for 11% of the world’s demand for edible oil and 16% of global imports in
2010-11.
BRANDED OIL SALES
Owing to a large
number of unorganized participants in India’s edible oil market, the share of
branded product sales remained low, while low-income consumers opted for
cheaper grades of oil in loose form. According to industry data, 31% of urban
households and 9% of rural households consume branded edible oils compared with
a national average of 16%. Given the low branded oil market penetration, rising
affluence levels and Indian consumers becoming quality-conscious, there is
significant growth expected in the branded segment. Among the major edible oils
consumed, palm oil is still traded and sold mostly in loose form with packaged
sales contributing 15%-20% of total sales. On the other hand, sunflower and
soya oil have a high proportion of packaged sales at around 70% and 55% of
total sales respectively.
INDIA OPPORTUNITY
The Indian market
represents significant opportunity for edible oil players owing to a growing
population, income growth, low per capita consumption, low penetration and the
fact that edible oils are a necessary input in the diet for most Indian consumers.
Per capita consumption: The Indian annual
per capita consumption grew steadily from 4 kg in the 1970s to 10.2
kg in the late
1990s to 13.5-14 kg in 2010-11. However, it is still below the global average of
around 24 kg, signaling high growth industry potential.
IMPORTS
Indian edible oil
imports witnessed a sizeable 21% y-o-y reduction in the second half of 2010-11
(November 2010-April 2011) on account of a relatively higher domestic oilseed
availability (29-30 mn MT expected for 2011 compared with 24.9 mn MT for 2010),
leading to higher domestic oil production. An increase in CPO prices (trading
almost at par with soya during December 2010-February 2011), following concerns
over Malaysian production estimates, resulted in lower imports. A subsequent
improvement in palm oil production estimates led to a correction in prices,
which coupled with the upcoming festive demand, is expected to revive import
volumes in the second half of 2011.
Taking into
account the current domestic edible oil supply of 8-8.5 mn MT per annum and
normal growth of 2- 3% (through moderate expansion in cultivated area and yield
improvements) in supply, a significant gap between domestic demand and supply
is likely to persist, which will result in continued import dependence for at
least 45% of consumption requirements, in addition to a dip in imports seen in
the first half of 2011.
CONSUMPTION
Indian edible oil
consumption is varied in preference across regions, owing to taste and availability.
Going by volumes, palm, soyabean and mustard/rapeseed are India’s three major
edible oils and cumulatively account for 75% of the total demand. While India
produces mustard oil almost entirely, soyabean oil is imported in significant
quantities (about 45-50%). Palm oil is imported entirely in its crude form for
port-based refineries, while a certain quantity is also imported in its refined
form.
Owing to consumer
cost economics and taste preferences, these three edible oil varieties are
expected to dominate the consumption mix. Therefore, companies with an exposure
to these oil types stand to benefit. Given the inherent price volatility,
participants with a diverse presence in all edible oil categories will benefit
than participants focused on a single oil variety, owing to flexibility in
modifying product portfolios in line with market realities.
As per industry
data, about 31% of urban households and about 9% of rural households consume
branded edible oils with the national average at around 16%. This represents a
significant untapped opportunity with a potential to grow to USD 13.5 bn by
2015.
PRICING
India’s edible oil
prices are directly linked to imported palm and soyabean oil prices, owing to
large dependence on imports among various oil types. Due to highly volatile
global edible oil prices, Indian participants are at various risks like
unexpected squeeze on margins owing to price differences in raw material
(linked to domestic factors) and final product prices (affected by global factors).
Edible oil prices
witnessed recovery owing to crude oil price increases in 2010-11 owing to
expected increases in bio-fuel demand, shortage of CPO production in
Malaysia/Indonesia and increasing demand. With the probability of sustained
high crude oil prices in the near-term, edible oil prices will continue to
remain firm, going forward.
It is expected
that anticipated demand growth will outstrip supply growth in 2010-11 and
2011-12. This widening gap is likely to result in firm pricing and revenue growth
for most edible oil companies. Companies with a larger portfolio of branded
products and higher capacity will probably benefit from higher average volumes
and sales prices.
IMPORT DUTY
The current duties
on crude palm oil is nil and refined palm oil is 7.5% (7.7% including education
cess), with the difference in net duty at 7.5% to protect the domestic
industry. Going forward, reducing the difference in import duties will remain a
key regulatory risk for the industry.
GROWTH DRIVERS
Population: India’s population increased to 1.21 bn at
the end of March 2011, from 1.17 bn in March 2010. Uttar Pradesh is the most
populous state with 199 mn people.
Rural market attractiveness: The Union Budget
2011-12 proposed a 12% increase in the rural development department’s plan
outlay from Rs.661000.000 millions in 2010-11 to Rs.741000.000 millions for
2011-12. The government increased the allocation for the Mahatma Gandhi
National Rural Employment Guarantee Act (NREGA) by Rs.100000.000 millions to
Rs.580000.000 millions. From January 2011, wages under the scheme were linked
to consumer price index for agricultural workers, which increased wage payout
by about Rs.4,000 crore. The government increased allocation for the Department
of Rural Development by over 300% from 2005-06 levels. The literacy rate
increased from 64.83% in 2001 to 74.04% in 2011, an increase of 921 bps.
Per capita income: India’s per
capita income grew 17.9% to Rs.54,835 in 2010- 11 from Rs.46,492 in 2009-10.
Middle-class: The Indian middle-class is expected to grow to 267 mn over five
years; the percentage of the country’s
Middle-class is expected to increase from 13.1% in
2009-10 to 20.3% by 2015-16 and 37.2% by 2025-26.
Changing demographics: India is expected
to be the largest contributor to the global workforce over 20 years with
working-age population expected to swell from 749 mn in 2010 to 962 mn by 2030.
GOVERNMENT INITIATIVES
• The Budget
2011-12 states that India will set up 15 more mega food parks and that the
states should reform the
Agriculture
Produce Marketing Act (APMC) to improve the supply chain
• The Budget also
allocated USD 135 mn to the Food Processing Ministry from the existing USD 90
mn
• As a measure to
boost investment in agriculture, viability gap funding for public private
partnerships was extended for setting up modern storage facilities besides
giving infrastructure status to cold chain
• According to
industry experts, with the upcoming mega parks, there will be an increase in
processing perishable products in India from the existing 6% to 20%. Moreover,
there will also be an increase in India’s share in global food trade from 1.5
to 3% by 2015.
According to an
industry body and E and Y study on the Indian food industry titled ‘Flavours of
Incredible India – Opportunities in the Food Industry’, published in October
2009, investment opportunities in the Indian food industry are set to surge
from USD 181 bn in 2015 to USD 318 bn by 2020.
WEB SITE DETAILS
BUSINESS DESCRIPTION
Subject is an India-based
vegetable oil solution company. The Company is engaged in the production of
vanaspati, refined oil, mustard oil, DOC and trading of goods. The Company’s
Jhoola brand is available in 17 Indian states and two Union territories. The
Company manufactures the packaging for all its products. As of March 31, 2010,
its manufacturing capacity consists of 18,00,000 high density polyethylene
(HDPE) jars per annum and 42,00,000 tins per annum. The Company exports
animal/poultry feed raw material to countries, such as Vietnam, Bangladesh,
Thailand, China, Indonesia, South Korea and other Far East countries. The
Company’s products and services include hydrogenated vegetable oils, refined
oil, deacidified oil, tin plate containers, plastic containers, fatty distillation,
enter esterified and gasification. Its wholly owned subsidiary includes JVL
Overseas Pte Limited, Singapore. For the six months ended 30 September 2010,
Subject revenues increased 91% to RS10.2B. Net income increased 68% to
RS241.5M. Revenues reflect an increase in income from operations. Net income
was partially offset by an increase in consumption of raw materials, a raise in
purchase of traded goods, increased employee costs, higher depreciation
expenses and an increase in other expenditure.
COMPANY PROFILE
Incorporated as a modest
manufacturer of hydrogenated vegetable oil or vanaspati ghee at 25
tonnes per day, Subject has grown to be the largest single unit
manufacturer of vanaspati in India. They use a modern mechanical physical
process technique instead of a chemical synthesis technique to bring their
customers the best and healthiest quality of branded hydrogenated vegetable and
refined oil. This stringent attention to quality, hygiene, safety and customer
satisfaction brought them an ISO 9001-2000 accreditation,
making them one of the first organizations in this industry to receive this
certification.
They are headquartered in Varanasi
with satellite offices in Alwar, Kolkata, Mumbai, Delhi and Singapore. Their
vanaspati manufacturing unit in Jaunpur (Uttar Pradesh) and Pahleja (Bihar),
along with their mustard oil manufacturing unit in Alwar (Rajasthan) constitute
their domestic and international presence.
MANAGEMENT
S. N. JHUNJHUNWALA - EXECUTIVE DIRECTOR
Shri. S.N.
Jhunjhunwala is Managing Director, Compliance Officer, Non-Independent
Executive Director of JVL Agro Industries Limited. Mr. S. N. Jhunjhunwala is
the Wholetime Director of the Company and is a Commerce Graduate. He has 28
years of experience in Solvent Extraction, Oil Refining and Vanaspati
Manufacturing units. He holds B.Com.
H. L. AGRAWAL - INDEPENDENT NON-EXECUTIVE DIRECTOR
Mr. H. L. Agrawal
is Independent Non-Executive Director of JVL Agro Industries Limited. He is a
Director and an ex-Administrative Judge of Honorable Patna High Court and
retired Chief Justice of Honorable Orissa High Court. He has experience in the
field of legal matters. He looks after all the legal affairs of the Company. He
holds BA, LLB.
S. K. DIKSHIT - INDEPENDENT NON-EXECUTIVE DIRECTOR
Dr. S.K. Dikshit
is Independent Non-Executive Director of JVL Agro Industries Limited. He is is
a Doctor. He has experience in herbal products and medical science.
KANHAIYA LAL GOENKA - INDEPENDENT NON-EXECUTIVE
DIRECTOR
Mr. Kanhaiya Lal
Goenka is Independent Non-Executive Director of JVL Agro Industries Limited. He
is experienced in solvent extraction, oil refining and vanaspati manufacturing
units. He holds B.Com.
ADARSH JHUNJHUNWALA - WHOLE-TIME DIRECTOR
Shri. Adarsh Jhunjhunwala
is Whole-time Director of JVL Agro Industries Limited. He is experienced in
Commerce and Financial Accounting. He holds Chartered Accountant and MBA
(Finance).
MAHESH KEDIA - INDEPENDENT NON-EXECUTIVE DIRECTOR
Mr. Mahesh Kedia
is Independent Non-Executive Director of JVL Agro Industries Limited. He is
experienced in Commerce and Financial Accounting. He is Chartered Accountant,
Science Graduate. He holds B. Sc (Statistics), C.A.
MILESTONES
1990
- Commenced production with a 25-TPD capacity
1995
- Switched Vanaspati processing technology from chemical processing
to modern mechanical technique
1997
- Started importing Crude Palmolein Oil (CPO), the basic raw material
in edible oil manufacture
1999
- Installed a 60-tpd unit for refined oil at Jaunpur, introducing
crude soybean and palmolein oil to the product mix
2000
- Increased Vanaspati production capacity to 200 TPD
2005
- Introduced a fractionation unit of 200 TPD capacity
2006
- Acquired a refining plant in Alwar (Rajasthan) for mustard oil. Investment
in Adamjee Extraction Private Limited, Sri Lanka for import of Vanaspati
ghee under the Jhoola brand
2007
- Emerged as the first Vanaspati manufacturer in Uttar Pradesh to
commission a 3-MW turbine; formed a wholly-owned subsidiary in Singapore under
the name of JVL Overseas Pte. Limited.
2008
- Started the work of putting an edible oil refinery/ Vanaspati unit
at Pahleja, Bihar.
- Commenced the production of refined bleach and deodrised oils.
- Started the export of de-oiled cakes.
- Received government notification for a multi-utility SEZ at
Chandauli, Varanasi.
2009
- Commercial production of the Pahleza unit for Haydrogenated fats
and Oiline had taken off with flying colors.
NEWS
JVL
AGRO INDUSTRIES EYEING TURNOVER OF RS 50000.000 MILLIONS BY 2015
28 September 2011
India, Sept. 28 --
JVL Agro Industries, largest manufacturing company of hydrogenated vegetable
oil in India, is eyeing to increase its turnover more than double to Rs
50000.000 millions by calendar year 2015. For the fiscal 2010-11, the company
had achieved a turnover of Rs 21800.000 millions and had earned a profit after
tax of Rs 500.000 millions. Recently, the company had started the work on
expanding capacity at its mustard seed crushing plant in Rajasthan in a bid to
meet its growing demand of mustard oil in the Central and Eastern India and
wants to be ready with enhanced capacity before the next season of mustard seed
arrives.JVL Agro Industries is engaged in the production and trading of
hydrogenated vegetable oil (vanaspati) and refined oil in India. The company's
products include saturated fats, refined palmolein and soybean oil, kachi ghani
mustard oil, and de-oiled cake.
JVL
AGRO INDUSTRIES BOARD RECOMMENDS DIVIDEND
05 September 2011
India, Sept. 05 --
JVL Agro Industries has informed that the board of directors of the company at
its meeting held on September 03, 2011, has recommended the dividend of 20% for
approval of members for the year ending on March 31, 2011, subject to the
approval of members at the annual general meeting of the company to be held on
September 30, 2011.The above information is part of company's filing submitted
to the BSE.
BOARD
RECOMMENDS DIVIDEND
05 September 2011
India, Sept. 05 --
JVL Agro Industries Limited has informed BSE that the Board of Directors of the
Company at its meeting held on September 03, 2011, inter alia, has recommended
the dividend @ 20% for approval of members for the year ending on March 31,
2011, subject to the approval of members at the Annual General Meeting of the
Company to be held on September 30, 2011.
JVL
AGRO INDUSTRIES DIRECTOR RESIGNS
30 August 2011
India, Aug. 30 --
JVL Agro Industries has informed that Shyam Poddar, Independent Director of the
company has resigned from the board of directors of the company. His
resignation was accepted with effect from August 06, 2011.The above information
is part of the company's filing submitted to the BSE.
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners, controlling
shareholders or senior officers as terrorist or terrorist organization or whom
notice had been received that all financial transactions involving their assets
have been blocked or convicted, found guilty or against whom a judgement or
order had been entered in a proceedings for violating money-laundering,
anti-corruption or bribery or international economic or anti-terrorism sanction
laws or whose assets were seized, blocked, frozen or ordered forfeited for
violation of money laundering or international anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper payments
to government officials for engaging in prohibited transactions or with
designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority for
any financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market survey
revealed that the amount of compensation sought by the subject is fair and
reasonable and comparable to compensation paid to others for similar services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs. 50.06 |
|
|
1 |
Rs. 79.15 |
|
Euro |
1 |
Rs. 69.03 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
5 |
|
OPERATING SCALE |
1~10 |
6 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
5 |
|
--PROFITABILIRY |
1~10 |
5 |
|
--LIQUIDITY |
1~10 |
5 |
|
--LEVERAGE |
1~10 |
5 |
|
--RESERVES |
1~10 |
5 |
|
--CREDIT LINES |
1~10 |
5 |
|
--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 |
NO |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
47 |
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.