%20LIMITED%20-%20155418%2028-Sep-2011_files/image002.jpg){kind=small}
MIRA
INFORM REPORT
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Report Date : |
28.09.2011 |
IDENTIFICATION DETAILS
|
Name : |
INDO RAMA
SYNTHETICS ( |
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Registered Office : |
31-A, MIDC Industrial Area, Butibori – 441 122, |
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Country : |
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Financials (as on) : |
31.03.2011 |
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Date of Incorporation : |
28.04.1986 |
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Com. Reg. No.: |
11-166615 |
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Capital
Investment / Paid-up Capital : |
Rs.1518.222
Millions |
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CIN No.: [Company
Identification No.] |
L17124MH1986PLC166615 |
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TAN No.: [Tax
Deduction & Collection Account No.] |
BPLI00021A |
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PAN No.: [Permanent
Account No.] |
AAALI1530L |
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Legal Form : |
A public limited
liability company. The company’s
shares are listed on the Stock Exchanges |
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Line of Business : |
Manufacturing of
Cotton, Synthetic and Blended Yarn. |
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No. of Employees : |
800
(Approximately) |
RATING & COMMENTS
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MIRA’s Rating : |
Ba (50) |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Maximum Credit Limit : |
USD 24791600 |
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Status : |
Satisfactory |
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Payment Behaviour : |
Usually correct |
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Litigation : |
Clear |
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Comments : |
Subject is a well
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 – April 1, 2010
|
Country Name |
Previous Rating (31.12.2009) |
Current Rating (01.04.2010) |
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A1 |
A1 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
INFORMATION DECLINED BY
|
Name : |
Mr. Mahendra |
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Designation : |
Operator |
LOCATIONS
|
Registered Office / Manufacturing
Plant : |
31-A, MIDC Industrial Area, Butibori – 441 122, |
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Tel. No.: |
91-7104-663000 / 01 |
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Fax No.: |
91-7104-663200 |
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E-Mail : |
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Website : |
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Corporate
Office : |
20th
Floor, |
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Tel. No.: |
91-124-4997000 |
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Fax No.: |
91-124-4997070 |
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E-Mail : |
ranvirk.vij@indorama-ind.com |
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Marketing Offices: |
Bhilwara
Silvassa
Tirupur
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DIRECTORS
AS ON 31.03.2010
|
Name : |
Mr. M. L. Lohia |
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Designation : |
Chairman Emeritus |
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Name : |
Mr. O. P. Lohia |
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Designation : |
Chairman and
Managing Director |
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Name : |
Mr. O. P. Vaish |
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Designation : |
Director |
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Name : |
Mr. A. K. Ladha |
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Designation : |
Director |
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Name |
Mr. Vishal Lohia |
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Designation |
Whole Time Director |
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Qualification |
Bachelors Degree in Financial & |
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Date of
Appointment : |
28.06.2002 |
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Name |
Dr. Arvind Pandalai |
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Designation |
Director (w.e.f. 20.07.2009) |
KEY EXECUTIVES
|
Name : |
Mr.
Jayant Sood |
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Designation : |
Company
Secretary |
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CORPORATE
EXECUTIVES |
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Name : |
Mr.
Hemant Sharma |
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Designation : |
Business
Head (Polyester) |
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Name : |
Mr. Anant. Kishore |
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Designation : |
Chief Operating Officer (Polyester) |
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Qualification : |
B.Sc. Chem, Engineering, PGDB and IM |
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Date of Appointment
: |
07.07.1999 |
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|
|
|
Name : |
Mr. Roshan K Nair |
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Designation : |
Vice President (Polyester) |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 30.06.2011
|
Category of Shareholder |
No. of Shares |
Percentage of
Holding |
|
(A) Shareholding of Promoter and Promoter Group |
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52964958 |
37.42 |
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961724 |
0.68 |
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43288057 |
30.59 |
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(B) Public Shareholding |
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|
5941831 |
4.20 |
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|
2418843 |
1.71 |
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|
4006850 |
2.83 |
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13237794 |
9.35 |
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8942525 |
6.32 |
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3526284 |
2.49 |
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6242016 |
4.41 |
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(C) Shares held by Custodians and against which Depository Receipts
have been issued |
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- |
- |
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10291360 |
6.78 |
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Total |
151822242 |
100.000 |
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(1) Indian%20LIMITED%20-%20155418%2028-Sep-2011_files/image005.gif){kind=small}
Individuals / Hindu Undivided Family%20LIMITED%20-%20155418%2028-Sep-2011_files/image006.gif){kind=small}
Individual shareholders holding nominal
share capital up to Rs. 0.100 millionBUSINESS DETAILS
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Line of Business : |
Manufacturing of Cotton,
Synthetic and Blended Yarn. |
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Products : |
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Exports : |
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Countries : |
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PRODUCTION STATUS AS ON 31.03.2011
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Particulars |
Unit |
Installed
Capacity* |
Actual
Production |
|
Polyester Staple
Fibre |
TPA |
263550 |
185929 |
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Polyester
Filament Yarn |
TPA |
259000 |
176723 |
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Polyester
Texturised Yarn |
TPA |
43800 |
42304 |
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Polyester Clips |
TPA |
87500 |
11864 |
|
Electrical Power |
MWPH |
82.5 |
48.3 |
Notes:
- The Company manufactures varying denier/ qualities of fibers/ yarn, the above capacity is calculated based on a mix of product range as certified by the management and relied on by the auditors being a technical matter.
- Delicensed vide notification no. 477 (E) dated 27 July 1991 and press note No. 1 (1998 series) dated 8 June 1998.
- TPA-Tones per annum
- MWPH-Mega watt per hour
GENERAL INFORMATION
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No. of Employees : |
800
(Approximately) |
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Bankers : |
· Axis Bank Limited · Bank of India · HDFC Bank Limited · Oriental Bank of Commerce · Punjab National Bank · State Bank of India · State Bank of Travancore ·
Standard Chartered Bank |
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Institutions : |
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Facilities : |
Notes : Loans and advances
from banks: - cash/other credit facilities from banks amounting to Rs.905.700
Millions (Previous year Rs.1759.700 Millions) are secured by way of hypothecation
of stocks of raw materials, work-in-progress, finished goods, stores and
spares, packing material, goods at port/in transit/under shipment,
outstanding money, book debts, receivables and other current assets of the
Company, both present and future. These loans are further secured by a second
charge on all the immovable properties of the Company, both present and
future. 2. Rupee term loans from banks comprising: - amounts aggregating Rs.1425.000 Millions (Previous year Rs. 2137.100
Millions) are secured by equitable mortgage on all the immovable properties
(excluding land in the state of Gujarat) by way of deposit of title
deeds and hypothecation of movable assets of the Company (save and except
book debts and assets exclusively hypothecated to Banks and Bodies Corporate)
including movable machinery, machinery spares, tools and accessories, both
present and future, ranking pari-passu with the charges created/ to be
created in favour of Banks and Financial Institution for securing Rupee and
Foreign currency term loans. - amounts aggregating Rs.359.800 Millions (Previous year Rs.614.800 Millions) availed from bank is secured by first specific charge over the specific assets purchased under the loan agreement for thermal power project of the Company. - amounts aggregating ` Nil (Previous year Rs.37.500 Millions) are secured by way of subservient charge on the current and fixed assets of the Company. - amounts aggregating ` Nil (Previous year Rs.26.300 Millions) are secured by way of subservient charge on the movable fixed assets of the Company. - working capital term loans aggregating Rs.376.200 Millions (Previous year Rs.573.800 Millions) are secured by way of first charge on the Company’s entire fixed assets ranking pari-passu with other banks. - car loan from bank of Rs.1.700 Millions (Previous year ` Nil) is secured by way of hypothecation of specific vehicle. 3. Foreign currency term loans from banks comprising: - amounts aggregating ` Nil (Previous year Rs.61.500 Millions) are secured by equitable mortgage on all the immovable properties (excluding land in the state of Gujarat) by way of deposit of title deeds and hypothecation of movable assets of the Company (save and except book debts and assets exclusively hypothecated to Banks and Bodies Corporate) including movable machinery, machinery spares, tools and accessories, both present and future, ranking pari-passu with the charges created/to be created in favour of banks and financial institution for securing rupee and foreign currency term loans. - amounts aggregating Rs.2104.200 Millions (Previous year Rs.2399.100 Millions) availed from a bank are secured by first pari-passu specific charge on the equipment purchased under this agreement for the Company’s polyester expansion project and a first charge on the land situated at Mehsana, Gujarat. 4. Other loans
and advances: - rupee term loan from others of Rs.187.600 Millions (Previous year Rs.250.100 Millions) is secured by equitable mortgage on all the immovable properties (excluding land in the state of Gujarat) by way of deposit of title deeds and hypothecation of movable assets of the Company (save and except book debts and assets exclusively hypothecated to Banks and Bodies Corporate) including movable machinery, machinery spares, tools and accessories, both present and future, ranking pari-passu with the charges created/ to be created in favour of Banks and Financial Institution for securing rupee and foreign currency term loans. - foreign currency term loan from others of Rs.724.600 Millions (Previous year Rs. 778.000 Millions) are secured by equitable mortgage on all the immovable properties (excluding land in the state of Gujarat) by way of deposit of title deeds and hypothecation of movable assets of the Company (save and except book debts and assets exclusively hypothecated to Banks and Bodies Corporate) including movable machinery, machinery spares, tools and accessories, both present and future, ranking pari-passu with the charges created/to be created in favour of Banks and Financial Institution for securing rupee and foreign currency term loans. [Loans and advances from banks and others aggregating Rs.2304.200 Millions (Previous year Rs.2781.600 Millions) are payable within one year, after considering Reschedulement.
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Banking
Relations : |
-- |
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Auditors : |
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Name : |
B
S.R. and Associates Chartered Accountant |
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Address: |
Gurgaon
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Associates/Subsidiaries : |
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CAPITAL STRUCTURE
As on 31.03.2011
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
185000000 |
Equity Shares |
Rs.10/- each |
Rs.1850.000 millions |
Issued and
Subscribed and Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
151822242 |
Equity Shares |
Rs.10/- each |
Rs.1518.222 Millions |
|
|
|
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|
Notes:
Of the above:
- 325,200 were issued as fully paid up otherwise than for cash, issued pursuant to a contract (Previous year 325,200 shares).
- 22,927,269 were allotted as fully paid up bonus shares by capitalisation of share premium account (Previous year 22,927,269 shares).
- 10,531,360 are outstanding against 1,316,420 Global Depository Receipts (GDR), each GDR comprising 8 underlying fully paid up equity shares of Rs.10 each (Previous year 10,531,360).
- 20,000,000 were issued during the year 2007-08 as fully paid up
shares to shareholders of erstwhile Indo Rama Petrochemicals Limited,
pursuant to a scheme of amalgamation, for consideration other than cash.
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 |
1518.200 |
1518.222 |
1518.222 |
|
|
2] Share Warrants |
203.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
4476.700 |
3568.771 |
3636.185 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
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NETWORTH |
6197.900 |
5086.993 |
5154.407 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
6115.600 |
8660.227 |
8758.787 |
|
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2] Unsecured Loans |
0.000 |
50.383 |
1375.173 |
|
|
TOTAL BORROWING |
6115.600 |
8710.610 |
10133.960 |
|
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DEFERRED TAX LIABILITIES |
2072.200 |
1394.699 |
1400.002 |
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|
|
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TOTAL |
14385.700 |
15192.302 |
16688.369 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
13223.400 |
14628.830 |
16625.700 |
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Capital work-in-progress |
198.400 |
67.453 |
33.755 |
|
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Foreign currency monetary item translations |
0.000 |
7.356 |
21.474 |
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INVESTMENT |
176.400 |
172.355 |
171.686 |
|
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DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
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CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
6820.100
|
2892.069
|
1691.590
|
|
|
Sundry Debtors |
1016.800
|
851.608
|
688.529
|
|
|
Cash & Bank Balances |
208.900
|
194.345
|
264.641
|
|
|
Other Current Assets |
0.000
|
0.000
|
0.000
|
|
|
Loans & Advances |
2357.400
|
2421.165
|
2845.455
|
|
Total Current Assets |
10403.200
|
6359.187
|
5490.235
|
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Less
: CURRENT LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry
Creditors |
6286.500
|
3514.101
|
2532.455
|
|
|
Current Liabilities |
2730.700
|
2376.395
|
2987.592
|
|
|
Provisions |
598.500
|
152.383
|
134.434
|
|
Total Current Liabilities |
9615.700
|
6042.879
|
5654.481
|
|
|
Net Current Assets |
787.500
|
316.308
|
(164.246)
|
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|
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MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
14385.700 |
15192.302 |
16688.369 |
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PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
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SALES |
|
|
|
|
|
|
|
Income |
27960.600 |
25260.484 |
24444.843 |
|
|
|
Other Income |
527.100 |
305.265 |
222.138 |
|
|
|
TOTAL (A) |
28487.700 |
25565.749 |
24666.981 |
|
|
|
|
|
|
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Less |
EXPENSES |
|
|
|
|
|
|
|
Raw materials consumed |
21548.700 |
19293.545 |
16069.685 |
|
|
|
Goods for trading |
43.100 |
224.231 |
188.310 |
|
|
|
Operating and other expenditure |
4486.000 |
4135.865 |
5108.225 |
|
|
|
(Increase)/decrease in finished goods and work in progress |
(2114.300) |
(482.600) |
2131.228 |
|
|
|
Increase/(decrease) in excise duty on stocks of finished
goods and waste |
245.200 |
56.646 |
(178.186) |
|
|
|
Other Expenses |
0.000 |
0.000 |
162.012 |
|
|
|
TOTAL (B) |
24208.700 |
23227.687 |
23481.274 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
4279.000 |
2338.062 |
1185.707 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
696.600 |
770.395 |
1137.898 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
3582.400 |
1567.667 |
47.809 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
1499.000 |
1491.469 |
1514.748 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
2083.400 |
76.198 |
(1466.939) |
|
|
|
|
|
|
|
|
|
Less |
TAX (I) |
689.300 |
4.873 |
326.583 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-I) (J) |
1394.100 |
71.325 |
(978.344) |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
863.600 |
780.214 |
1746.527 |
|
|
|
|
|
|
|
|
|
|
TRANSFER
FROM DEBENTURE REDEMPTION RESERVE |
0.000 |
12.029 |
12.031 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Interim dividend
|
151.800 |
0.000 |
0.000 |
|
|
|
Proposed
dividend |
151.800 |
0.000 |
0.000 |
|
|
|
Tax on dividend |
50.400 |
0.000 |
0.000 |
|
|
|
Transferred to general reserve |
200.000 |
0.000 |
0.000 |
|
|
BALANCE CARRIED
TO THE B/S |
1703.700 |
863.568 |
780.214 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN FOREIGN
CURRENCY |
|
|
|
|
|
|
|
Export Earnings |
7256.600 |
4936.024 |
3475.391 |
|
|
|
Other Earnings |
56.700 |
30.127 |
30.862 |
|
|
TOTAL EARNINGS |
7313.300 |
4966.151 |
3506.253 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
17441.300 |
9606.467 |
6431.097 |
|
|
|
Packing Material |
8.800 |
19.842 |
0.000 |
|
|
|
Stores & Spares |
41.600 |
108.445 |
86.454 |
|
|
|
Capital Goods |
43.000 |
12.864 |
2.151 |
|
|
TOTAL IMPORTS |
17534.700 |
9747.618 |
6519.702 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
9.18 |
0.47 |
(6.44) |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
|
30.06.2011 |
|
Type |
|
|
1st
Quarter |
|
Sales Turnover |
|
|
6254.400 |
|
Total Expenditure |
|
|
6147.900 |
|
PBIDT (Excl
OI) |
|
|
106.500 |
|
Other Income |
|
|
982.600 |
|
Operating
Profit |
|
|
1089.100 |
|
Interest |
|
|
169.800 |
|
Exceptional
Items |
|
|
0.000 |
|
PBDT |
|
|
919.300 |
|
Depreciation |
|
|
374.800 |
|
Profit
Before Tax |
|
|
544.500 |
|
Tax |
|
|
30.100 |
|
Reported PAT |
|
|
514.400 |
|
Extraordinary Items |
|
|
0.000 |
|
Prior Period Expenses |
|
|
0.000 |
|
Other Adjustments |
|
|
0.000 |
|
Net Profit |
|
|
514.400 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
PAT / Total Income |
(%) |
4.89
|
0.29
|
[3.97]
|
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
7.45
|
0.30
|
[6.00]
|
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
8.82
|
0.36
|
[6.63]
|
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.34
|
0.01
|
[0.28]
|
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
2.53
|
2.90
|
3.06
|
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.08
|
1.05
|
0.97
|
LOCAL AGENCY FURTHER INFORMATION
OPERATIONAL AND
FINANCIAL REVIEW
During the year, the Company recorded gross sales of
Rs.30,001.000 million as against Rs.26,594.000 million in previous year,
representing an increase of 12.81% which is considered satisfactory considering
the present market scenario. EBIDTA is up at ` 4,279 million as against
Rs.2,338.000 million last year representing an increase of 83%. Profit Before
Tax stood at ` 2,083 million against a `Rs.76.00 million for the previous year.
This year the net profit Stood at Rs.1,394.000 million as
against Rs.71.000 million last year. The turnaround in profits was possible due
to improvement in margins coupled with optimal utilization of resources and
reduction in interest cost.
The Company is witnessing an improved business environment
marked by a combination of rising raw material prices and improvement in demand
for finished goods. There has also been growing interest from relatively new
segments like technical and home textiles, which in turn is contributing to the
demand. Despite the multifarious business challenges of 2010, we have been able
to achieve motivating results. It is encouraging to see that both domestic as
well as export segments are registering increase in demand across all our
products.
Polyester demand is expected to further rise on back of
high prices of cotton and other alternate fibres. Cotton prices have already
reached a record high, and are continuously rising because of short supply.
Moreover, no further capacities are being further added going forward in near
term, in existing polyester fibre capacities. The demand for polyester products
is expected to rise at faster pace in coming years because of widening price
gap between cotton and polyester products. All these will augur well for us in
the coming years.
In financial year 2010-11, we have gone ahead with several value addition projects like replacing Furnace Oil (FO) based heat treatment media (HTM) with coal based plant, expansion in high capacity Draw Texturised Yarn
(DTY) machines which will convert more POY into value added DTY products and also setting up Stream turbine generator of 11MW capacity. All these projects shall be operational in the current financial year. On completion, these initiatives will significantly contribute to our operational efficiency and reduction in cost and thereby increasing our profits.
MANAGEMENT DISCUSSION
AND ANALYSIS
The Indian Economy
India is the world’s largest democracy and the 12th largest economy of the world. The GDP growth
plummeted to 6.8% in 2008-09 (due to global meltdown), recovered to 8% in
2009-10 and finally touched 8.5% in 2010-11. This is owing to India’s robust
regulatory mechanism and timely stimulus by the government. The country’s GDP
growth is expected to be around 8-8.5% in 2010-11, aided by increasing domestic
consumption, low credit leverage, low debt exposure and a growing thrust on
infrastructure creation.
Key Growth Drivers
Rising population: India’s population is estimated to be Rs.1.21 billion in 2011 and growing at 1.3%. The country’s ‘young’ comprises over 50% people, who are below 25 years. This group is expected to drive the sale of lifestyle products.
Surging per capita income: Per capita income was Rs.46,492 Millions in 2009-10, and it is expected to grow by 17.3% and reach Rs 54,527 in 2010-11.
Expanding middle class: The middle class comprises 22% of the total population and by 2010 this class is expected to grow to about 32% of the total population.
Urbanization: Only 28% of India’s population today lives in urban areas, and is expected to reach 40% by 2020, signalling a significant consumer, infrastructure and retail expenditure.
Global Trade Scenario
Global trade is all set to register a turnaround with an
estimated growth rate of 14.5% for 2010, compared to -12.2% in 2009. The
volumes increased faster than the expected recovery in global trade.
Merchandise exports of the developed economies are predicted to expand by 11.5%
in volume, vis-ŕ-vis 16.5% for the rest of the world (including developing CIS
countries). The strong recovery in trade indicates improved economic activity
worldwide. India’s share in world trade is close to 2%, which is estimated US$
500 billion.
Textile Industry
Scenario
Global Textile
The global textile and clothing trade is expected to
witness a smart recovery from US$ 527 billion in 2009 to estimated US$ 600
billion in 2010. Although this figure is still short of from US$ 612 billion in
2008, a 14% growth
is robust, considering that Q1 2010 still was under the
clouds of recession.
China is expected to claim a lion’s share of the global
textile and clothing trade with estimated US$ 206 billion and India is expected
to cross US$ 25 billion in 2010. The
global trade in textiles and clothing will increase owing
to production centres steadily shifting from Western
countries to Asia and the Middle East. Simultaneously, there is an increase in
the consumption in USA and European region. The trade is likely to increase
from US$ 600 billion to US$800 billion by 2015 and US$1,000 by 2020.
Changing Focus
The global market for textile and apparel is expected to
expand significantly on account of consumption in new markets, global expansion
of modern retail business, boom of air and sea shipments, growth of textile and
related production in Eastern Europe, CIS, Turkey, the Middle East, South East
Asia, India, China and South America.
In 2011, emerging Asian countries, namely Bangladesh,
India, Vietnam and Cambodia are believed to steal the spotlight of the global
textile industry. These countries will be playing a significant role, owing to
their low-cost advantage.
Indian Textile Industry
The Indian Textile industry is expected to register an
overall growth of 7% in 2010.
The export performance of Indian textiles and apparel has
gained momentum and year 2010-11 is expected to witness an estimated 11% growth
at US$ 26 billion. However, India trails substantially behind China, both in
rate of growth in exports as well as overall share in world textile exports as
China has an estimated 34% share, while India lags behind with 4.3%.
Most developed countries will continue to witness a
decline in exports of textiles and apparel, due to higher cost of production.
This should create fresh opportunity for India to increase its share in world
textile and apparel exports. India may stand to gain from China as it may yield
some export opportunity due to rising demand within China and rising cost of
production. According to Technopak, India has the capability and opportunity to
reach US$ 80 billion exports by 2020. It can enhance the share from the current
4.3% to 8%. There is a significant potential for India to almost double the
global export share.
About Subject
Indo Rama Synthetics (India) Ltd. (Indo Rama) is a polyester manufacturing company operating its business through two segments, namely polyester division and power division.
The Company offers a wide range of polyester products, which include Polyester Staple Fibre (PSF), Partially Oriented Yarn (POY), Draw Texturised Yarn (DTY), Fully Drawn Yarn (FDY) and Polyester Chips. Equipped with
a state-of-the-art integrated manufacturing complex at Butibori near Nagpur in Maharashtra, Indo Rama also has
several technical collaborations with various technology leaders in Japan, Germany and the USA. A customer focused organization, Indo Rama stands for high quality standards and innovative business practices.
Marketing Strategy
In 2010-11, the Company consolidated sales in its entire products category. The thrust on developing new customers with aggressive marketing intelligence paid rich dividends. A renewed focus on developing sales of PSF in non-woven segment yielded rich dividends.
Moreover, Indo Rama is looking to enhance the market share through right placement of products in domestic markets and also looking at diversifying its product base. The Company also strengthened its customer base in export geographies through competitive pricing and quality offerings.
Raw Material Procurement
The scenario in polyester has changed drastically this year, due to the shortage of cotton. The rising prices of cotton and shortage resulted in a swift demand for polyester products like PSF, POY, film and texturised yarn. The price scenario for these products has touched the highest levels. This triggered an unexpected demand of Purified Terephthalic Acid (PTA) and Monoethylene Glycol (MEG) - the key raw materials to make polyester resulting into price increase. From the present situation it seems that PTA and MEG demands will remain stiff due to increase in polyester capacities.
Purified Terephthalic
Acid (PTA)
In the beginning of 2010-11, PTA was expected to be easily available and prices were declining but after the floods hit China and Pakistan there has been a shortage of cotton crop. This impacted the prices, which had been
going down started moving up from July onwards and went up to unexpected heights. Only one new PTA plant came up in China during the end of the year and all other commissioning of plants were delayed, which further fuelled the demand for PTA.
In India imports have gone up from 30,000 MT per month to 70,000 MT per month due to frequent plant outages of local PTA producers.
Analyzing the current situation the demand and supply position, PTA is likely to remain tight due to few new PTA
capacities additions and higher utilization of polyester capacities.
Monoethylene Glycol
(MEG)
MEG witnessed an increasing trend from June/July due to unexpected demand in polyester. Further MEG expected growth rate was lower than demand growth rate resulting into higher operating rates of MEG plants globally. The trend is expected to continue due to limited MEG Capacities worldwide until new capacities come up by 2013-14. Due to expected polyester capacity utilization the position of MEG in general is likely to remain tight in the next year as no new capacity is likely to come in 2011-12.
Power Business
11 MW STG Project was initiated to generate additional power to reduce captive power cost in 2010-11. This project was initiated to produce additional 11 MW coal based (thermal) power from the surplus steam of CPP boilers as a substitute for costly DG Power. After project commissioning, the overall captive power cost of polyester production shall reduce. Upon 11 MW STG project commissioning, the installed capacity of power generation in the complex shall be 93.5 MW. The capacity comprises 52.5 MW DG sets, based on furnace oil and 41 MW STG facilities based on coal.
Indo Rama has availed of maximum power for captive consumption through coal based power plants by restricting DG operations to the lowest and imported power from state grid as a cheaper option, whenever necessary.
HR Policy
The basic principles of Human Resources policies include:
Recruitment based solely on merit by following welldefined and systematic selection procedures without discrimination; sustain motivated and quality work force through appropriate and fair performance evaluation, reward and recognition systems; identify training needs within the organisation and design and implement those
need based training programmes resulting in continuous upgradation of knowledge, skills and attitudes of the employees; maintain a quality Human Resource Management System to meet the international ISO standards; plan, design, train, equip and motivate the department staff to meet this standard of expectation.
Regular and sustained training and growth programmes are at the core of all Indo Rama functions and operations, and the year 2010-11 saw several initiatives being undertaken by the Company in this regard. The Company follows a strict training policy for its employees after identifying the needs of the individual. Cultural and
sports activities are not only organised for the employees and their family members but also for the entire industrial area to maintain a cordial and healthy relations. Effective cost-saving measures have become a major part of the employees’ work profile. The sincere efforts put in by the employees over the past years have resulted in major savings in administrative expenses.
Work culture
emphasises:
· Freedom to experiment
· Continuous learning and training
· Transparency
· Quality in all aspects of work
·
Rewards based on performance and potential
FIXED ASSETS:
- Land (Freehold and
Leasehold)
- Roads and Buildings
- Plant and Machinery
- Furniture and Office
Equipments
- Vehicles
- Software
PRESS RELEASE:
Indo
Rama Synthetics announces Q1 FY1112 results
Net
Profit at Rs 514.400 Millions vs. loss of Rs 125.300 Millions
Gross Sales
up at Rs 6672.800 Millions vs. Rs 6221.900 Millions
Gurgaon, July 18, 2011: Indo Rama Synthetics (India)
Limited, India’s largest dedicated polyester manufacturer, today announced its
unaudited results for Q1 ended June 30, 2011.
Gross sales for the quarter stood at Rs 6672.800 Millions,
an increase of 7.2% as compared to Rs.6221.900 Millions in the corresponding
quarter of the previous year. Company recorded a Profit after Tax of Rs 514.400
Millions over a Loss of Rs 125.300 Millions in the corresponding period of the
prior year.
The company managed an impressive sales performance despite
a difficult quarter for the Textile industry. The demand remained depressed due
to sharp fall in cotton prices and downward movement in the prices of Viscose
and Acrylic fibres. Polyester fibre prices too moved southwards with wide
inventory build up in the industry.
The company expects some recovery to take off from the
second quarter with clearing of old inventory and improvement in prices.
Meanwhile company continued its focus on operation efficiency projects to
maximize gains when the volumes come back in the balance of the year.
The company is in the process of expanding the production
capacity for its value added product Draw Texturized Yarn (DTY) from existing
64,800 Tonnes to 84,000 Tonnes by installation of 8 new machines.
To improve cost efficiency the company had planned to
replace existing heat treatment media based on furnace oil to coal at a project
cost of Rs 730.000 Millions. The project is on track and is to be commissioned
in the later part of this month.
The project to add 11MW of Power to utilize the spare boiler capacity
for captive consumption will be commissioned by Q3 FY 12.
Commenting on the
results, O P Lohia, Chairman and Managing Director said:
“Despite a challenging quarter we could
achieve sales growth. Delivering on important cost reduction projects has
helped company arrest the decline in margins in a soft demand phase of the
business cycle. We remain buoyant on the prospects of the Polyester business
with newer and increased applications of the fibre taking place globally.”
About Subject
Subject is India’s largest
dedicated polyester manufacturer with an Integrated Manufacturing Complex at
Butibori near Nagpur in Maharashtra, with capacity of 6,10,050 tonnes per annum
of Polyester Staple Fibre, Filament Yarn, Draw Texturized Yarn, Fully Drawn
Yarn and Textile grade Chips.
FY 2010 Net Sales
up 3% to Rs.25260.500 millions
EBITDA up 97% to
Rs.2235.400 millions
Gurgaon,
27.05.2010: Indo Rama Synthetics (
During FY 2010 Net
sales stood at Rs.25260.5 million as against Rs.24444.8 million in FY 2009.
EBITDA increased to Rs.2235.4 million from Rs.1133.9 million, a growth of 97%.
Profit after Tax for FY 2010 is Rs.71.33 million, as compared to a loss of
Rs.978.3 million in the previous year.
During the period
the total exports of the Company also improved significantly to Rs.5087.9
million as against Rs.3663.1 million in the last year.
The company is
witnessing an improved business environment marked by a combination of relative
stability in raw material prices and improvement in demand for finished goods.
Increased
capacities of PTA and MEG have enabled better availability and stability in raw
material prices. With regard to finished goods, widening interest from
relatively new segments like home and technical textiles is contributing to the
demand. Concurrently, continuing firm cotton prices despite a ban on exports is
shoring up demand for polyester.
All these
developments are expected to have a compounding positive effect on the
polyester manufacturing sector in the coming quarters.
The Power
division’s contribution to sales during the year continues to be stable with a
total sales amounting to Rs.2658.0 million as against Rs.2531.4 million in FY
2009.
Financial Results Communication
Indo Rama
Synthetics (
Highlights:
Q3 ended December 31, 2009
• Net sales up 15%
to Rs.6133.300 millions
• Operating EBITDA
increases to Rs. 494.5 millions, a growth of 474%
Nine months ended December 31, 2009
• Net sales up at
Rs.18979.4 millions
• Operating EBITDA
increases to Rs.1607.600 millions, up from Rs.31.700 millions
• PAT up at
Rs.21.000 millions, as against loss of Rs.1186.500 millions
Gurgaon, 23
January, 2010: Indo Rama Synthetics (
In the quarter
ended December 31, 2009, Net Sales was recorded at Rs.6133.300 millions, an
increase of 15% over Rs.5361.400 millions in the corresponding period last
year. EBIDTA was up 474% at Rs.494.500 millions as compared to Rs.86.100
millions in the corresponding quarter. Profit Before Tax for the quarter stood
at Rs.1.400 millions as against Loss of Rs.544.300 millions last year.
Interest cost was
brought down by 48% on account of low cost borrowings availed by the company
during the quarter.
Commenting on the
results, Mr. O. P. Lohia, Chairman and Managing Director, IRSL said, “During the
quarter we witnessed continuing higher prices of our key inputs namely PTA and
MEG on the back of a rise in crude oil prices. Considering the signs of
improvement being seen in market conditions, the resultant increase in cost
will be passed on further down the value chain.”
Press Release
Indo Rama Synthetics (
Three months Profit After Tax
at Rs. 470.800 millions from Rs. 0.900 million
Nine months Profit After Tax up
at Rs.387.300 millions from Rs. 21.000 millions
Gurgaon, 14.02.2011:
Indo Rama Synthetics (
Net sales for the
quarter stood at Rs. 6518.800 millions, an increase of 6.2% as compared to Rs.
6133.300 millions in the corresponding quarter. EBIDTA for the quarter has been
Rs.1210.300 millions as compared to Rs. 506.600 millions in the same period
last year, a marked increase of 139%. During the quarter, the Profit after Tax
was Rs.470.800 millions as against Rs. 0.900 million in the corresponding
period.
In the 9 months
ended 31.12.2010 while the net sales has been Rs.19414.500 millions as against
Rs.18979.400 millions in the previous year, the Profit after Tax for the period
has jumped to Rs.387.300 millions from Rs.21.000 millions in the corresponding
period.
The performance of
polyester business continues to be robust during the quarter with increased
demand both in the domestic and overseas markets. On the back of strong demand
growth, steep cotton prices and no further expansions in the polyester
capacities, the company could garner higher margins in its product lines and
the company is hopeful that this trend is going to continue in coming quarters
also. The concerted efforts towards cost management have further contributed to
better margins during the quarter.
The Company is
already in process of expanding its production capacity for its value added
product Draw Texturized Yarn (DTY). In this connection the company has
installed 8 new DTY machines to take its DTY capacity from the existing 43800
Tonnes Per Annum, to 64,800 Tonnes Per Annum. Further, 8 more DTY machines will
be added which will be operational in phases from July 2011 onwards and
complete by end of the year, and will take the total DTY capacity to 84000
Tonnes Per Annum.
To achieve better
cost efficiency, the company is replacing the existing heat treatment media
based on Furnace oil to coal based with project cost of Rs. 730.000 millions.
The payback period of this capex is only 2.2 years. The company is also adding
11 MW of Power to utilize the spare boiler capacity.
Keeping in view the
good performance of the company, The Board has recommended an Interim dividend
of 10% to its shareholders.
Commenting on the
Results, O P Lohia, Chairman and Managing Director, said:
“The quarter has been quite encouraging, with the market continuing to be
buoyant and textile sector set for further growth. The Cotton prices will
continue to remain firm in foreseeable future which will lead to higher PSF
demand with equally remunerative prices. Our thrust on value added products and
optimization of inventory levels have contributed to our good performance.
Because of good results of the Company and bright future prospects, we have
declared an Interim dividend of 10% to all our shareholders.”
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.49.17 |
|
|
1 |
Rs.76.65 |
|
Euro |
1 |
Rs.66.63 |
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 |
6 |
|
--LEVERAGE |
1~10 |
6 |
|
--RESERVES |
1~10 |
6 |
|
--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 |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
50 |
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.