MIRA
INFORM REPORT
|
Report Date : |
18.08.2012 |
IDENTIFICATION DETAILS
|
Name : |
EMAMI PAPER MILLS LIMITED |
|
|
|
|
Registered
Office : |
687 Anandapur, Kasba Golpark, E M |
|
|
|
|
Country : |
|
|
|
|
|
Financials (as
on) : |
31.03.2012 |
|
|
|
|
Date of
Incorporation : |
26.09.1981 |
|
|
|
|
Com. Reg. No.: |
21-034161 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs.120.998 Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
L21019WB1981PLC034161 |
|
|
|
|
Legal Form : |
A Public Limited Liability company. The company’s Share are Listed on
the Stock Exchange. |
|
|
|
|
Line of Business
: |
Manufacturing of Paper |
|
|
|
|
No. of Employees
: |
Not Available |
RATING & COMMENTS
|
MIRA’s Rating : |
A (59) |
|
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 6900000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a well established and reputed company having fine track
record. There appears sharp dip in the profitability of the company. However,
networth of the company appears to be strong. Trade relations are reported as
fair. Business is active. Payments are reported to be regular and as per
commitments. The company can be considered normal for business dealings at usual
trade terms and condition. |
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 – June 30, 2012
|
Country Name |
Previous Rating (31.03.2012) |
Current Rating (30.06.2012) |
|
India |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
EXTERNAL AGENCY RATING
|
Rating Agency Name |
CRAE |
|
Rating |
Long term rating = A |
|
Rating Explanation |
Having adequate degree of safety regarding timely servicing of
financial obligation it carry low credit risk. |
|
Date |
Nov, 2011 |
|
Rating Agency Name |
CRAE |
|
Rating |
Short term rating = A1+ |
|
Rating Explanation |
Having very strong degree of safety regarding timely payment of
financial obligation it carry lowest credit risk. |
|
Date |
Nov, 2011 |
RBI DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter in
the publicly available RBI Defaulters’ list.
EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of
31-03-2012.
LOCATIONS
|
Registered Office / Investor Relations / Marketing Division : |
687 Anandapur, Kasba Golpark, E M |
|
Tel. No.: |
91-33-66136264/ 66136471 |
|
Fax No.: |
91-33-66136400 |
|
E-Mail : |
|
|
Website : |
|
|
|
|
|
Head Office : |
|
|
Tel. No.: |
91-33-248 9330 / 6035 / 4076 / 6029/ 25488654 |
|
Fax No.: |
91-33-248 9288 |
|
Telex : |
021-2337 MONO IN |
|
|
|
|
Factory 1 / Warehouse : |
Balgopalpur, Post
Rasulpur – 756 020, Balasore, |
|
Tel. No.: |
91-6782-75 723/755/756 |
|
Fax No.: |
91-6782-75 778 |
|
|
|
|
Factory 2 : |
|
DIRECTORS
As on 31.03.2012
|
Name : |
Mr. Radhe Shyam Goenka |
|
Designation : |
Executive Chairman |
|
Address : |
110 A, Southern Avenue,
Kolkata – 700029, West |
|
Date of Birth/Age : |
05.01.1947 |
|
Qualification : |
M.Com., LL.B |
|
Experience : |
42 Years |
|
Previous Employment
: |
Kemco Chemicals – Advisor |
|
Date of Appointment : |
23.10.2000 |
|
|
|
|
Name : |
Mr. Radhe Shyam Agarwal |
|
Designation : |
Director |
|
Address : |
118, Southern Avenue, Kolkata – 700029, West |
|
Date of Birth/Age : |
06.01.1946 |
|
Date of Appointment : |
26.03.1994 |
|
|
|
|
Name : |
Mr. Manish Goenka |
|
Designation : |
Whole Time Director |
|
Address : |
110 A, Southern Avenue, Kolkata – 700029, West |
|
Date of Birth/Age : |
07.02.1974 |
|
Qualification : |
M.B.A |
|
Date of Appointment : |
01.02.2000 |
|
Other Directorship
: |
· AMRI Hospitals Limited · Emami Group of Companies Private Limited · Bhanu Vyapaar Private Limited ·
Prestige Vyapaar Limited |
|
|
|
|
Name : |
Mr. Aditya Vardhan Agarwal |
|
Designation : |
Director |
|
Address : |
118, Southern Avenue, Kolkata – 700029, West |
|
Date of Birth/Age : |
06.01.1975 |
|
Date of Appointment : |
23.10.2000 |
|
|
|
|
Name : |
Mr. P. S. Patwari |
|
Designation : |
Executive Director |
|
Address : |
58 B Block, D New Alipore, Kolkata – 700053, West |
|
Date of Birth/Age : |
126.03.1955 |
|
Experience : |
32 Years |
|
Previous Employment
: |
Commercial Executive, Hindustan Motors Limited |
|
Date of Appointment : |
28.11.1994 |
|
|
|
|
Name : |
Mr. Shrawan Kumar Todi |
|
Designation : |
Director |
|
Address : |
2 Queens Park, Kolkata – 700019, West |
|
Date of Birth/Age : |
15.08.1943 |
|
Date of Appointment : |
05.04.2003 |
|
|
|
|
Name : |
Mr. J.K. Khetawat |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. U. Gururaja Bhat |
|
Designation : |
Director |
|
Address : |
A3, Amaravatee Appartments, 2nd |
|
Date of Birth/Age : |
15.04.1938 |
|
Date of Appointment : |
26.09.2003 |
|
|
|
|
Name : |
Mr. Nandananadan Mishra |
|
Designation : |
Director |
|
Address : |
Flat No.D053, |
|
Date of Birth/Age : |
20.10.1942 |
|
Date of Appointment : |
22.03.2006 |
|
|
|
|
Name : |
Mr. H. M. Marda |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. J. N. Godbole |
|
Designation : |
Director |
|
Qualification : |
B.Tech (Hons), IIT Powai Certificate in Fin. Management |
|
Other Directorship
: |
· J. K. Cement Limited · Embio Limited · Gillander Arbuthnot and Company Limited · IMP Powers Limited · The Oudh Sugars Mills Limited · Madhya Bharat Papers Limited · Zuari Industries Limited · Saurashtra Cement Limited · Gujarat Alkalies and Chemicals Limited · Kesar Terminals and Infrastructure Limited · Midas Asset Reconstruction Company Private Limited · IDBI Asset Management Limited · Zuari Holdings Limited · Kesar Multimodal Logistic Limited |
|
|
|
|
Name : |
Mr. S. Balasubramanian |
|
Designation : |
Director |
KEY EXECUTIVES
|
Name : |
Mr. Ghanshyam Saraf |
|
Designation : |
Vice President (Finance)and Company Secretary |
|
Address : |
AE 397, |
|
Date of Birth/Age : |
01.01.1957 |
|
Date of Appointment : |
28.05.1994 |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 30.06.2012
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
|
(A) Shareholding of Promoter and Promoter Group |
|
|
|
|
|
|
|
|
5,301,050 |
8.76 |
|
|
39,912,087 |
65.97 |
|
|
45,213,137 |
74.73 |
|
|
|
|
|
|
125,000 |
0.21 |
|
|
125,000 |
0.21 |
|
Total shareholding of Promoter and Promoter Group (A) |
45,338,137 |
74.94 |
|
(B) Public Shareholding |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,047,899 |
13.50 |
|
|
|
|
|
|
2,340,383 |
3.87 |
|
|
4,635,000 |
7.66 |
|
|
16,631 |
0.03 |
|
|
16,500 |
0.03 |
|
|
131 |
-- |
|
|
15,160,913 |
25.06 |
|
Total Public shareholding (B) |
15,160,913 |
25.06 |
|
Total (A)+(B) |
60,499,050 |
100.00 |
|
(C) Shares held by Custodians and against which Depository Receipts
have been issued |
-- |
-- |
|
Total (A)+(B)+(C) |
60,499,050 |
100.00 |
(1) Indian
Individuals / Hindu Undivided Family
Individual shareholders holding nominal
share capital up to Rs.0.100 millionsBUSINESS DETAILS
|
Line of Business : |
Manufacturing of Paper |
||||||||
|
|
|
||||||||
|
Products : |
· Newsprint Paper ·
Writing and Printing Paper
|
||||||||
|
|
|
||||||||
|
Brand Names : |
“EMAMI”. |
GENERAL INFORMATION
|
No. of Employees : |
Not Available |
|||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||
|
Bankers : |
|
|||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||
|
Facilities : |
(Rs.
In Millions)
|
|||||||||||||||||||||||||||
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
S. K. Agrawal and Company Chartered Accountants |
|
Address : |
4-A, Council House Street, Kolkata – 700001, West Bengal,
India |
|
|
|
|
Unit Auditors (Kolkata Works) : |
|
|
Name : |
Salarpuria Jajodia and Company Chartered Accountants |
|
Address : |
7 C R Avenue, Kolkata – 700072, West Bengal, India |
|
|
|
|
Enterprise over
which persons described in (a) above are able to exercise significant
Influence : |
· Emami Limited · Emami Biotech Limited · Emami Cement Limited · Emami Foundation · Oriental Sales Agencies (India) Private Limited · Suntrack Commerce Private Limited |
CAPITAL STRUCTURE
As on 31.03.2011
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
62500000 |
Equity Shares |
Rs.2/- each |
Rs.125.000 Millions |
|
10000 |
6% Redeemable Non Cumulative Preference Shares |
Rs.10/- each |
Rs.1.000 Millions |
|
|
Total |
|
Rs.126.000
Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
60499050 |
Equity Shares |
Rs.2/- each |
Rs.120.998 Millions |
|
|
|
|
|
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
120.998 |
120.998 |
120.998 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
1608.958 |
1573.830 |
1483.969 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
1729.956 |
1694.828 |
1604.967 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
3360.359 |
3171.500 |
3945.210 |
|
|
2] Unsecured Loans |
704.000 |
0.000 |
271.740 |
|
|
TOTAL BORROWING |
4064.359 |
3171.500 |
4216.950 |
|
|
DEFERRED TAX LIABILITIES |
368.907 |
345.728 |
303.655 |
|
|
|
|
|
|
|
|
TOTAL |
6163.222 |
5212.056 |
6125.572 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
4417.264 |
3861.012 |
4059.125 |
|
|
Capital work-in-progress |
696.746 |
102.654 |
52.534 |
|
|
|
|
|
|
|
|
INVESTMENT |
5.765 |
5.765 |
30.040 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
781.425
|
764.604 |
698.726
|
|
|
Sundry Debtors |
504.572
|
712.560 |
754.128
|
|
|
Cash & Bank Balances |
228.507
|
40.988 |
62.913
|
|
|
Other Current Assets |
0.000
|
0.000 |
0.000
|
|
|
Loans & Advances |
791.240
|
603.439 |
671.073
|
|
Total
Current Assets |
2305.744
|
2121.591 |
2186.840 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
90.822
|
79.731 |
22.707
|
|
|
Other Current Liabilities |
1123.012
|
751.967 |
137.791
|
|
|
Provisions |
48.463
|
47.268 |
42.469
|
|
Total
Current Liabilities |
1262.297
|
878.966 |
202.967 |
|
|
Net Current Assets |
1043.447
|
1242.625 |
1983.873 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
6163.222 |
5212.056 |
6125.572 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
|
|
SALES |
|
|
|
|
|
|
|
Net Revenue from Operations |
4896.900 |
4298.401 |
3978.942 |
|
|
|
Other Income |
58.949 |
69.639 |
20.088 |
|
|
|
TOTAL (A) |
4955.849 |
4368.040 |
3999.030 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of materials consumed |
2800.387 |
2628.283 |
2132.998 |
|
|
|
(Increase) / Decrease in inventories of Finished Goods & Work-in-Progress |
62.430 |
(96.622) |
139.995 |
|
|
|
Employee benefits expense |
297.411 |
279.217 |
252.240 |
|
|
|
Other expenses |
1101.314 |
836.394 |
822.577 |
|
|
|
TOTAL (B) |
4261.542 |
3647.272 |
3347.810 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
694.307 |
720.768 |
651.220 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
306.585 |
274.035 |
239.345 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
387.722 |
446.733 |
411.875 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
271.622 |
265.759 |
294.090 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
116.100 |
180.974 |
117.785 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
33.030 |
42.322 |
48.891 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
83.070 |
138.652 |
68.894 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
103.276 |
56.813 |
79.388 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
50.000 |
50.000 |
50.000 |
|
|
|
Dividend |
36.300 |
36.300 |
36.300 |
|
|
|
Tax on Dividend |
5.888 |
5.889 |
6.169 |
|
|
BALANCE CARRIED
TO THE B/S |
94.158 |
103.276 |
56.813 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
21.387 |
55.897 |
14.921 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
488.703 |
628.547 |
555.399 |
|
|
|
Stores & Spares |
49.441 |
33.001 |
39.228 |
|
|
|
Capital Goods |
324.903 |
12.449 |
2.844 |
|
|
TOTAL IMPORTS |
863.047 |
673.997 |
597.471 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
1.37 |
2.29 |
1.16 |
|
QUARTERLY RESULTS
|
PARTICULARS |
|
|
30.06.2012 1st
Quarter |
|
Net Sales |
|
|
1133.600 |
|
Total Expenditure |
|
|
971.500 |
|
PBIDT (Excl OI) |
|
|
162.100 |
|
Other Income |
|
|
28.800 |
|
Operating Profit |
|
|
190.90 |
|
Interest |
|
|
180.400 |
|
PBDT |
|
|
82.500 |
|
Depreciation |
|
|
72.700 |
|
Profit Before Tax |
|
|
9.800 |
|
Tax |
|
|
2.900 |
|
Profit After Tax |
|
|
6.900 |
|
Net Profit |
|
|
6.900 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
PAT / Total Income |
(%) |
1.68
|
3.17 |
1.72 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
2.37
|
4.21 |
2.96 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
1.73
|
3.03 |
1.89 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.07
|
0.11 |
0.07 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
3.08
|
2.39 |
2.75 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.83
|
2.41 |
10.77 |
LOCAL AGENCY FURTHER INFORMATION
|
Sr. No. |
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 |
(Yes) |
|
8] |
No. of employees |
(No) |
|
9] |
Name of person contacted |
(No) |
|
10] |
Designation of contact person |
(No) |
|
11] |
Turnover of firm for last three years |
(Yes) |
|
12] |
Profitability for last three years |
(Yes) |
|
13] |
Reasons for variation <> 20% |
---------------------- |
|
14] |
Estimation for coming financial year |
(No) |
|
15] |
Capital in the business |
(Yes) |
|
16] |
Details of sister concerns |
(Yes) |
|
17] |
Major suppliers |
(No) |
|
18] |
Major customers |
(No) |
|
19] |
Payments terms |
(No) |
|
20] |
Export / Import details (if applicable) |
(No) |
|
21] |
Market information |
---------------------- |
|
22] |
Litigations that the firm / promoter involved in |
---------------------- |
|
23] |
Banking Details |
(Yes) |
|
24] |
Banking facility details |
(Yes) |
|
25] |
Conduct of the banking account |
---------------------- |
|
26] |
Buyer visit details |
---------------------- |
|
27] |
Financials, if provided |
(Yes) |
|
28] |
Incorporation details, if applicable |
(Yes) |
|
29] |
Last accounts filed at ROC |
(Yes) |
|
30] |
Major Shareholders, if available |
(No) |
|
31] |
Date of Birth of Proprietor/Partner/Director, if available |
(Yes) |
|
32] |
PAN of Proprietor/Partner/Director, if available |
(No) |
|
33] |
Voter ID No of Proprietor/Partner/Director, if available |
(No) |
|
34] |
External Agency Rating, if available |
(Yes) |
FINANCIAL PERFORMANCE
The Company strengthened its leadership in the newsprint segment and continued to be the lowest cost manufacturer in the country. The Company’s commitment in delivering high quality products to customers has been a major reason for maintaining prestigious position in the industry and allowed the Company to achieve better sales realization against the stiff competition with imported newsprint.
The Company registered a considerable growth of 13.92% in the turnover from Rs.4298.400 Millions in 2010 - 11 to Rs.4896.900 Millions during the year. The Company achieved another landmark by registering a record production of 144920 MT for the year. Operating profit (PBDIT) was marginally lower at Rs.694.300 Millions as against Rs.720.800 Millions last year despite sharp increase in the cost of raw material, coal and financing charges. Directors are pleased to inform that in spite of turbulent business environment, the company, based on its intrinsic strength, has maintained its performance and outperformed the industry.
With the increased focus on the literacy by the Government and allocation of large funds for education and print media sector, demand of the company’s products is expected to be very promising. Therefore, overall performance of the Company is expected to be improved substantially in the coming years.
ENVIRONMENT
MANAGEMENT
The Company continued with its commitment towards ensuring a safe and healthy workplace for all employees, guests and visitors, by maintaining the highest levels of safety and occupational health standards. Manufacturing units of the Company have best-in-class infrastructure, competent resources and state-of-art protection measures. The Environment, Occupational Health and Safety Management Systems conform to the best international standards.
Subject has adopted one of the best Integrated Management Systems (IMS), duly certified by M/s DNV, through their Surveillance and Recertification Audits, covering the following:
• ISO 9001:2008 - Quality Management System
• ISO 14001:2004 - Environment Management System
• OHSAS 18001:2007 - Occupational Health and Safety Management System.
EPM committed to its responsible manufacturing practices and has implemented several environment-friendly processes under its well-defined Environment Policy. The occupational health and safety process is implemented through periodic safety audit, safety observation and environment audit. EPM always makes constant efforts to better the stipulated standards, ensuring sufficient energy conservation with higher waste recycling. EPM has implemented its policies as under:
• Complying with all relevant legislative requirements
• Reducing pollution load in terms of liquid discharge, air emission and land conservation
• Saving energy and preserving natural resources like water, raw material, fuels
• Generating awareness on environment, safety and health
• Minimizing unsafe acts and working conditions
• Promoting comprehensive programmes to propagate health and environmental safety
• Adoption of superior technology and equipment with respect to resource conservation, energy and eco-friendliness.
The Company is well-renowned for its environmental management practices. It possesses:
• State-of-art effluent treatment plant
• Sludge dewatering system
• Feeding of ETP sludge to FBC boiler for power generation
• Recharging cum Rainwater harvesting system
• Development of green belt.
The aforesaid steps have resulted in declining water and energy consumption, reflected in the data submitted for energy conservation in this report.
AWARDS
The Company received the following awards during the year:
Energy Award:
2011- ‘National Award for Excellence in Energy Management- 2011’ by CII – GBC Hyderabad. This prestigious award was received from Dr. Ajay Mathur, Director General, and Bureau of Energy Efficiency in 10th Energy Efficiency Summit 2011.
For Energy Management, Emami has also received the First Prize for “NATIONAL ENERGY CONSERVATION AWARD” for the Pulp and Paper Sector from the Ministry of Power, Government of India for the year 2009-10
Excellence Award:
2011- Silver Certificate of Merit of The Economic Times India Manufacturing Excellence Award 2011 for the efforts taken by the Plant and its personnel in enhancing manufacturing and supply chain excellence. This award is jointly hosted by The Economic Times in collaboration with Frost and Sullivan.
MANAGEMENTS
DISCUSSIONS AND ANALYSIS
GLOBAL ECONOMY
The global economy rebounds in 2010, improves marginally in 2011 led by demand revival in key global economies. In Asia and Middle East, Europe and Latin America, demand grew by over 7 per cent during the year on the back of a revival in the macroeconomic environment. Growing domestic demand has encouraged large capacity additions in Asia where around 41 million tonnes of paper and board capacity are likely to be added over the next 5 years. Of this, China alone is expected to add around 30 million tonnes of capacity while India would add 4 to 5 million tonnes.
INDIAN ECONOMIC
OVERVIEW
The Indian Economy is estimated to grow over 7 per cent during 2012 and it is further expected that the growth momentum is likely to continue over the next few years.
With the increasing per capita income, growing emphasis on inclusive growth and faster development of infrastructure, education and health sector, India is well poised for major leap forward. Twelfth Five Year Plan in India is expected to further boost up the aforesaid sectors resulting in the great demand for cultural grade and industrial grade paper required for education, media and industrial sectors. But rising costs and inflation is a matter of concern. They do hope that effective steps will be taken to curb this trend without sacrificing the current growth momentum.
INDIAN PAPER INDUSTRY
Consumption of paper and paper board is closely linked to the economic development of a country. In India, though the per capita consumption of paper is low, it is gradually improving with buoyant economic growth. Industrial production, expenditure incurred on the print media, government spending on education, population growth and literacy levels are other contributing factors. With stable economic growth in the country, domestic demand for paper (including newsprint) has been steadily increasing over the years. It has grown at a 4-year CAGR of around 7 per cent to reach around 11.6 million tonnes in 2011-12 and expected to reach around 17 – 17.5 million tonnes in 2016-17.
The paper industry’s market size (including newsprint) in 2010-11 has been estimated at Rs.445000.000 Millions. It has grown at a CAGR of 8.7 per cent over the last 4 years from around Rs.320000.000 Millions in 2006-07. Of all the segments, paperboard has been the highest value segment in 2010-11 accounting for a share of around 42 per cent of the total market size. This was followed by W and P paper at about 37 per cent and newsprint at about 13 per cent. Specialty paper segment accounted for about 8 percent in 2010-11.
Around 215,000 new educational institutions are expected to be established in the country between 2010- 11 and 2015-16, as an outcome of the Indian government’s Right to Education Act (RTE) initiative. In 2009, the government had passed the RTE to stimulate the spread of education in the country. Correspondingly, the Gross Enrolment Ratio is expected to increase to 90 per cent by 2015 from 71 per cent in 2008. Additionally, initiatives like Rashtriya Madhyamik Shiksha Abhiyan and Sarva Shiksha Abhiyan have boosted demand for W and P paper.
The paperboard segment caters to the packaging of manufactured goods. It can be further classified into tertiary packaging, which includes kraft paper and consumer packaging, which includes greyback paperboard, whiteback board, folding box board (FBB) and solid bleached board (SBB). Demand for paperboard is closely linked to the level of industrial activity in the country.
Out of total industrial demand in 2010-11, kraft paper accounted for nearly 60 per cent, recycled boards like greyback / whiteback accounted for 31 per cent and virgin boards like FBB / SBB accounted for 9 per cent. Demand for paperboard has increased at a CAGR of 6.9 per cent to an estimated 5.0 million tonnes in 2010-11 from around 3.9 million tonnes in 2006-07.
The business environment in the sector is quite challenging and the companies producing high quality product and pricing at competitive rates alone can sustain and flourish in the domestic and international markets.
Paper industry has been granted a status of a priority sector for foreign collaboration and foreign equity participation upto 100% and is entitled to receive automatic approval from the Reserve Bank of India. More foreign players are expected to join the industry in the coming years.
Demand for paper and paperboard closely follow the economic growth of a country and have a positive orrelation to the prevailing economic trends. In India, the demand drivers and growth triggers have come from a combination of factors:
• The rising level of national income;
• The growing per capita disposable income;
• Rising aspiration levels of the people;
• increasing size of the population;
• spread of education and literacy throughout the country;
• Government’s several initiatives that focus on education; and
• Higher level of industrial activity and corporate spending.
Consistent economic growth in India is expected to result in the robust demand for paper, which has grown on an average 8% for past few years. During the past 5 years, newsprint has registered a growth of 13% while writing and printing paper registered growth of 7 ˝%. The Company operates in these sectors.
Emami Paper mill is the largest newsprint manufacturer in India and producing world class product and selling the same against stiff competition with the imported newsprint. With the constant high demand of its product, EPM expects strong financial performance in the coming years.
INDIAN NEWSPRINT
INDUSTRY
The newsprint market in India is characterized with voluminous demand and high growth rate. However capacity of Indian paper mills is insufficient to meet the demand and almost 62% of the demand is met by way of import of newsprint. Thus this market is still very much open to absorb further expansions by the Indian Players, provided quality newsprint as per customer requirements are supplied at a competitive price.
CRISIL Research estimates demand for newsprint to grow by 9-10 per cent CAGR from 2.1 million tones in 2011-12 to 3.4 million tonnes in 2016-17, faster than the growth in circulation of print media. The sharper rise is also attributed to the expected rise in the number of pages per newspaper, mainly driven by rise in advertising spends of corporate. Rising literacy levels in the country have been driving the growth of print media in the country.
The National Youth Readership study in 2009 discloses following interesting facts those have major bearing over the Indian newsprint market.
• Nearly 24% of the household have newspaper subscription.
• Four out of every seven households of graduates and three of every eight urban households with literates buy a newspaper.
• Despite television being the most popular source of information (78%), followed by newspapers (53%), the later cored over television for news and current affairs information source.
• Literacy increased from 64.83% in 2001 to 74.04% in 2011, as per census 2011.
India has more daily newspaper than any other nation and out of world’s 100 largest newspapers 20 are Indian.
Manufacturing newsprint through the waste paper is prevalent in India. Since India does not have a developed waste paper collection system, raw material availability is low and prices are high. Consequently, imports of waste paper accounts for 55-60% of the total waste paper consumed (mostly from the US, the world’s largest waste paper market).
CONTINGENT
LIABILITIES NOT PROVIDED FOR IN RESPECT OF: (As on 31.03.2012)
(i) Outstanding guarantees and letters of credit furnished by the bankers on behalf of the Company secured by hypothecation of current assets – Rs.56.374 Millions (Rs.251.260 Millions).
(ii) Sales tax / VAT / Entry Tax / Central Excise duties / Service tax / ESI Contribution and other taxes under appeal / review (net of advances) – Rs.67.577 Millions (Rs.4.687 Millions)
(iii) Bonds / Undertakings given under EPCG scheme to Custom Authority – Rs.84.166 Millions (Rs.57.874 Millions)
(iv) Withdrawal of incentive tariff of electricity by NESCO (net of advance) – Rs.4.626 Millions (Rs.4.626 Millions)
STATEMENT OF UNAUDITED FINANCIAL RESULTS FOR THE QUARTER ENDED 30TH
JUNE, 2012
Rs. In Millions
|
SL. NO. |
PARTICULARS |
3 Months ended 30.06.2012 (Unaudited) |
|
|
|
|
|
1 |
Income from operations |
1133.600 |
|
|
Total |
1133.600 |
|
2 |
Expenses |
|
|
|
a. Cost of Material Consumed |
724.200 |
|
|
b. Changes in inventories of finished goods and work-in-progress |
(39.000) |
|
|
c. Employee benefits expense |
81.200 |
|
|
d. Power & fuel |
138.600 |
|
|
e. Depreciation |
72.700 |
|
|
f. Other Expenses |
66.500 |
|
|
Total Expenses |
1044.200 |
|
3 |
Profit / (Loss)
from Operations before other Income and |
|
|
|
finance costs(1-2) |
89.400 |
|
4 |
Other Income |
28.800 |
|
5 |
Profitf(Loss) before
finance costs (3+4) |
118.200 |
|
6 |
Finance Costs |
108.400 |
|
7 |
Profit Before Tax
(5-6) |
9.800 |
|
8 |
Tax Expense |
2.900 |
|
9 |
Net Profit After
tax for the period |
6.900 |
|
10 |
Paid - up Equity Share Capital (Face Value Rs. 2/-each) |
121.000 |
|
11 |
Reserves Excluding Revaluation Reserve |
- |
|
12 |
Earnings Per Share (not annualised) |
|
|
|
(a) Basic |
0.11 |
|
|
(b) Diluted |
0.11 |
|
|
|
|
|
A |
PARTICULARS OF
SHAREHOLDING |
|
|
1 |
Public Share
Holding |
|
|
|
-Number of Shares |
15160913 |
|
|
- Percentage of Shareholding |
25.06% |
|
2 |
Promoter and
Promoter Group Shareholding |
|
|
|
a) Pledged / Encumbered |
|
|
|
-Number of Shares |
NIL |
|
|
- Percentage of Shareholding (as a % of the total shareholding |
NIL |
|
|
of promoter and promoter group) |
|
|
|
- Percentage of Shares (as a % of total share capital of the |
NIL |
|
|
Company) |
|
|
|
b) Non - Pledged / Encumbered |
|
|
|
-Number of Shares |
45338137 |
|
|
- Percentage of Shares (as a % of the total shareholding |
|
|
|
of promoter and promoters group) |
100.00% |
|
|
- Percentage of Shares (as a % of total share capital of the |
|
|
|
Company) |
74.94% |
|
|
|
|
|
B |
Investor Complaints |
|
|
|
Pending at the beginning of the quarter |
Nil |
|
|
Received during the quarter |
Nil |
|
|
Disposed off during the quarter |
Nil |
|
|
Remaining unresolved at the end of the quarter |
Nil |
Note:
1. The above financial results have been reviewed by the Audit Committee, and taken on record by the Board of Directors at its meeting held on 13th day of August, 2012. The limited review has been carried out by the Auditors.
2. Lower production due to annual maintenance shut of both the units in April, 2012 and adverse movement of foreign currencies have impacted profitability of the Company during the quarter.
3. Considering present volatility in foreign exchange rates, effects of foreign exchange fluctuation on outstanding loans including rollover will be recognised at the year end.
4. The Company operates in a single business segment i.e. paper. Mence segment reporting as per AS 17 is not applicable.
5. Comparative figures of the previous period have been regrouped / rearranged wherever necessary.
Fixed Assets:
- Free
- Building
- Plant and
Machinery
- Furniture and
Fittings
- Vehicles
WEBSITE DETAILS:
PROFILE:
Subject enjoys operating efficiencies which has been further enhanced on successful commissioning of its New paper Machine.
It manufactures newsprint from waste paper, which is not just
environment-friendly but will increasingly insulate the Company from a growing
scarcity in virgin fibre, a major concern among India's paper players.
There is a relatively lower need to invest significantly in countering effluent
discharges, making the business profitable and sustainable.
It has invested reasonably for environmental protection for the waste-paper
based industry, making the business profitable as well as sustainable.
As a result, even at a nil rate of customs duty on newsprint subject will be
able to thrive amidst international and national competition, leading to
profitably sustainable growth over the coming years
Responsibility
With a billion in population, India is the largest democracy in the world.
With over 22,000 newspapers, of which 1800 are dailies, its media market is the
second largest in the world.
The symbiotic relationship between the access to information and the freedom of
choice has not only established the robustness of India's democracy, It has
made domestic newsprint manufacturers integral to the country's democratic
process
.
At Emami Paper, one of the five largest newsprint manufacturers, they are
playing a responsible role.
By increasing their installed capacity in line with a growing national
appetite.
By widening their product range to accommodate evolving consumer needs.
By pricing their product affordably so that their customers can widen their
readership and entrench the democratic tradition deeper.
By ensuring on-time delivery to their clients, for whom timely newspaper
delivery is critical to success.
These factors make then a significant player in Easten India, servicing
consistently the needs of some of India's largest publishing houses.
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 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 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.55.70 |
|
|
1 |
Rs.87.55 |
|
Euro |
1 |
Rs.68.85 |
INFORMATION DETAILS
|
Report Prepared
by : |
NTH |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
6 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
6 |
|
--LEVERAGE |
1~10 |
6 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
59 |
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.