MIRA INFORM REPORT
|
Report Date : |
22.08.2012 |
IDENTIFICATION DETAILS
|
Name : |
GAMMON INDIA LIMITED |
|
|
|
|
Registered
Office : |
Gammon House,
Veer Savarkar Marg, Prabhadevi, Mumbai – 400 025, |
|
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|
Country : |
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|
Financials (as
on) : |
31.03.2011 |
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|
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|
Date of
Incorporation : |
15.06.1922 |
|
|
|
|
Com. Reg. No.: |
11 – 000997 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs.274.900 Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
L74999MH1922PLC000997 |
|
|
|
|
TAN No.: [Tax Deduction &
Collection Account No.] |
MUMG07937G |
|
|
|
|
PAN No.: [Permanent Account No.] |
AAACG3821A |
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|
|
Legal Form : |
A Public Limited Liability company. The company’s Share are Listed on the
Stock Exchange. |
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|
Line of Business
: |
Construction
engineers, contractors and civil engineers |
|
|
|
|
No. of Employees
: |
6000 (Approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
A (60) |
|
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 84000000 |
|
|
|
|
Status : |
Good |
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|
|
|
Payment Behaviour : |
Regular |
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|
|
|
Litigation : |
Clear |
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|
Comments : |
Subject is a well
– established and a reputed company having good track. Directors are reported
to be experienced and respectable businessmen. But there appears continuous
dip in the profitability form last two years. However, network of the company
appears to be strong. Trade relations are fair. Business is active. Payments
are reported to be regular and as per commitments. The company can
be considered good for normal business dealing 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 |
ICRA |
|
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 |
April 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/Head Office : |
Gammon House,
Veer Savarkar Marg, Prabhadevi, Mumbai – 400 025, Maharashtra, India |
|
Tel. No.: |
91-22-66614000 / 24306761 / 24301084 / 6744 4000 (Extn : 4050) |
|
Fax No.: |
91-22-24300529 / 24300221 / 66614025 |
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E-Mail : |
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Website : |
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Corporate Office : |
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|
Factory : |
v
Parbati Hydro Electric
Project, Village and Post Office – Sainj, District Kullu, Himachal Pradesh,
India v
Teesta Head Race Tunnel, Makha
Post Singtam, District – East Sikkim – 737134, v
Kaiga Nuclear Power Project,
Unit 3 and 4 Kaiga, District – Uttar Kannada - 581400, Karnataka, India v
Chennai Water Supply
Augmentation Project, Plot No. 32, Chandran Nagar, CLC Works Road, Chromepet,
Chennai – 600044, Tamilnadu, India v
Kalapakkam
Reactor Building, Salai Street, Meyyur, Sadras, Kalpakkam – 603 102,
Tamilnadu, India v
New
Brahmaputra Bridge, Ward No. 1, Sadilapur – 781 012, Guwahati, India v
Prabatri
H. E. Project – Stage – III, C/o. Bhagat Singh and Sons, VPO Larji, District
– Kullu, Himachal Pradesh, India v
Sewa
Hydroelectic Project Stage – II, Vill: Gatti, Po: Bani, Tehsil: Basoli,
District: Kathua (Jammu and Kashmir), India v
Anji
Khad Bridge Project, Post Granmore, Gita Nagar, District. Reasi – 182 311,
Jammu, India v
DMRC
Noida – BC 12 and BC 13, Adjacent to Noida Sarita Vihar Road, Plot No.4,
Sector 94, Noida, Uttar Pradesh, India v
Bihar
Corrindor – Phase II, Camp Madhubani, At Village and Post: Madhubani, (12 KM
From Pratapganj, Via Pratapganj), District Surpoul, Bihar, India |
DIRECTORS
As on 31.03.2011
|
Name : |
Mr. Abhijit Rajan |
|
Designation : |
Chairman and Managing Director |
|
Date of Birth/Age : |
46 years |
|
Qualification : |
B. Com L.S. E. |
|
Experience : |
27 years |
|
Date of Appointment : |
17.05.1991 |
|
|
|
|
Name : |
Mr. Peter Gammon |
|
Designation : |
Chairman Emeritus |
|
|
|
|
Name : |
Mr. Rohit Modi |
|
Designation : |
Managing Director |
|
|
|
|
Name : |
Mr. Himanshu Parikh |
|
Designation : |
Executive Director |
|
Age: |
47 Years |
|
Qualification: |
B.com |
|
Experience: |
27 Years |
|
Date of Appointment: |
02.08.2004 |
|
|
|
|
Name : |
Mr. Rajul A Bhansali |
|
Designation : |
Executive Director |
|
Age: |
51 Years |
|
Qualification: |
Graduate (Chartered Accountant) |
|
Experience: |
29 Years |
|
Date of Appointment: |
30.03.2003 |
|
|
|
|
Name : |
Mr. Digambar C. Bagde |
|
Designation : |
Director and CEO (T and D Business) |
|
|
|
|
Name : |
Mr. Chandrahas C. Dayal |
|
Designation : |
Non - Executive Director |
|
|
|
|
Name : |
Mr. Atul Dayal |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Jagdish C. Sheth |
|
Designation : |
Additional Director |
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|
|
|
Name : |
Mrs. Urvashi Saxena |
|
Designation : |
Additional Director |
|
|
|
|
Name: |
Mr. Atul Kumar shukla
|
|
Designation : |
Additional Director
|
|
|
|
|
Name: |
Mr. Naval Cohudhary |
|
Designation : |
Additional Director
|
KEY EXECUTIVES
|
Name : |
Ms. Gita Bade |
|
Designation : |
Company Secretary and compliance |
|
Tel No.: |
91-22-66614050 |
|
E-Mail: |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 30.06.2012
|
Category of
Shareholder |
No. of Shares |
Percentage of
Holding |
|
(A) Shareholding of Promoter and Promoter Group |
|
|
|
|
|
|
|
|
1,773,164 |
1.30 |
|
|
42,872,555 |
31.41 |
|
|
44,645,719 |
32.71 |
|
|
|
|
|
|
|
|
|
|
3,086,435 |
2.26 |
|
|
3,086,435 |
2.26 |
|
Total shareholding
of Promoter and Promoter Group (A) |
47,732,154 |
34.97 |
|
|
|
|
|
(B) Public Shareholding |
|
|
|
|
|
|
|
|
10,131,469 |
7.42 |
|
|
3,383,454 |
2.48 |
|
Insurance Companies |
75,000 |
0.05 |
|
|
31,443,991 |
23.04 |
|
|
45,033,914 |
32.99 |
|
|
|
|
|
|
|
|
|
|
18,066,524 |
13.24 |
|
|
|
|
|
Individual shareholders holding nominal share
capital up to Rs. 0.100 million |
10,403,460 |
7.62 |
|
Individual shareholders holding nominal share
capital in excess of Rs. 0.100 million |
2,694,953 |
1.97 |
|
|
|
|
|
Any Others (Specify) |
12,569,463 |
9.21 |
|
|
168,570 |
0.12 |
|
|
4,684,720 |
3.43 |
|
|
538,378 |
0.39 |
|
|
5,825,045 |
4.27 |
|
|
818,972 |
0.60 |
|
|
89,189 |
0.07 |
|
|
444,589 |
0.33 |
|
|
43,734,400 |
32.04 |
|
Total Public shareholding (B) |
88,768,314 |
65.03 |
|
Total (A)+(B) |
136,500,468 |
100.00 |
|
|
|
|
|
C) Shares held by Custodians and against which Depository Receipts
have been issued |
|
|
|
|
-- |
-- |
|
|
-- |
-- |
|
|
-- |
-- |
|
Total (A)+(B)+(C) |
136,500,468 |
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Construction
engineers, contractors and civil engineers |
|
|
|
|
Products : |
|
PRODUCTION STATUS (As on 31.03.2011)
|
Particulars |
Units |
|
Conductors |
|
Installed Capacity |
MT |
110000 p.a. |
36000 p.a. |
|
Actual Production including job work |
MT |
102525 p.a. |
11916155 p.a. |
GENERAL INFORMATION
|
No. of Employees : |
6000 (Approximately) |
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Bankers : |
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Facilities : |
(Rs.
In Millions)
|
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
Natvarlal Vepari and Company Chartered
Accountants |
|
Address : |
Oricon House, 4th Floor, 12, K. Dubash Marg, Mumbai – 400023, Maharashtra, India |
|
Tel. No.: |
91-22-67527100 |
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Fax. No.: |
91-22-67527101 |
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Email : |
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|
|
|
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Subsidiaries /
Fellow Subsidiaries: : |
|
|
|
|
|
Joint Ventures : |
|
|
|
|
|
Associates &
Group Companies : |
|
|
|
|
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Entities where
control exists: |
|
CAPITAL STRUCTURE
As on 31.03.2011
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
355000000 |
Equity Shares |
Rs.2/- each |
Rs.710.000 Millions |
|
3000000 |
6% Optionally Convertible Preference Shares |
Rs.350/- each |
Rs.1050.000 Millions |
|
|
Total |
|
Rs.1760.000
Millions |
Issued:
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
137319722 |
Equity Shares |
Rs.2/- each |
Rs.274.600
Millions |
|
|
|
|
|
Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
135739182 |
Equity Shares |
Rs.2/- each |
Rs.271.500
Millions |
|
Add : |
Share Forfeiture Account |
|
Rs. 3.400
millions |
|
|
(Money received in respect of 170948 Rights shares of Rs. 10/- each
forfeited ) |
|
|
|
|
Total |
|
Rs.274.900 Millions |
|
|
|
|
|
Note:
Of the above 264,000 Shares are issued for consideration other than cash 5,806,700 Shares are issued as fully paid Bonus Shares by Capitalisation of Rs.7.000 Millions from Reserves and Rs.4.500 Millions from Security Premium Account 20,106,106 Shares are issued as consideration on merger of ATSL with the Company
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 |
274.900 |
258.300 |
1267.100 |
|
|
2] Share Application Money |
11.600 |
203.500 |
18.100 |
|
|
3] Reserves & Surplus |
20881.500 |
18987.200 |
14521.200 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
21168.000 |
19449.000 |
15806.400 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
7602.900 |
4885.500 |
3252.500 |
|
|
2] Unsecured Loans |
13658.600 |
8060.100 |
6470.200 |
|
|
TOTAL BORROWING |
21261.500 |
12945.600 |
9722.700 |
|
|
DEFERRED TAX LIABILITIES |
814.300 |
717.300 |
543.600 |
|
|
|
|
|
|
|
|
TOTAL |
43243.800 |
33111.900 |
26072.700 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
13299.700 |
10843.500 |
9480.300 |
|
|
Capital work-in-progress |
526.800 |
846.400 |
353.800 |
|
|
|
|
|
|
|
|
INVESTMENT |
2113.000 |
1978.400 |
2206.100 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
14881.000
|
13091.500
|
10111.000 |
|
|
Sundry Debtors |
18662.600
|
17636.800
|
13437.000 |
|
|
Cash & Bank Balances |
576.500
|
724.800
|
513.600 |
|
|
Other Current Assets |
2393.500
|
434.200
|
275.100 |
|
|
Loans & Advances |
13813.900
|
10655.500
|
8700.900 |
|
Total
Current Assets |
50327.500
|
42542.800
|
33037.600 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
12191.600
|
12489.600
|
9588.400
|
|
|
Other Current Liabilities |
10562.900
|
10307.800
|
9155.400
|
|
|
Provisions |
268.700
|
301.800
|
261.300
|
|
Total
Current Liabilities |
23023.200
|
23099.200
|
19005.100 |
|
|
Net Current Assets |
27304.300
|
19443.600
|
14032.500 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
43243.800 |
33111.900 |
26072.700 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
55515.800 |
44681.100 |
36359.600 |
|
|
|
Other Income |
374.400 |
580.900 |
634.400 |
|
|
|
TOTAL (A) |
55890.200 |
45262.000 |
36994.000 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Expenditure on Contracts |
51268.900 |
39602.800 |
32455.900 |
|
|
|
Establishment Expenses |
1716.000 |
1291.100 |
718.200 |
|
|
|
Depreciation withdrawn from Revaluation Reserves |
(31.300) |
(31.300) |
(31.300) |
|
|
|
Share in Loss of Joint Ventures |
98.300 |
149.600 |
40.900 |
|
|
|
TOTAL (B) |
53051.900 |
41012.200 |
33183.700 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
2838.300 |
4249.800 |
3810.300 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
123.100 |
1396.600 |
1052.600 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
2715.200 |
2853.200 |
2757.700 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
948.400 |
740.600 |
670.800 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
1766.800 |
2112.600 |
2086.900 |
|
|
|
|
|
|
|
|
|
Less |
TAX (I) |
582.300 |
855.500 |
682.100 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-I) (J) |
1184.500 |
1257.100 |
1404.800 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
2733.600 |
2314.300 |
1599.200 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
120.000 |
297.500 |
297.100 |
|
|
|
Amount Transferred to Debenture Redemption Reserve |
455.000 |
383.800 |
249.000 |
|
|
|
Amount Transferred from Debenture Redemption Reserve |
(191.500) |
0.000 |
0.000 |
|
|
|
Dividend from Own Shares |
(5.800) |
(3.500) |
(3.200) |
|
|
|
Interim and Proposed Dividend |
|
|
(2.900) |
|
|
|
– Equity Shares |
106.300 |
76.500 |
65.000 |
|
|
|
– Preference Shares |
0.000 |
60.700 |
63.000 |
|
|
|
Tax on Dividend |
17.400 |
22.800 |
21.700 |
|
|
BALANCE CARRIED
TO THE B/S |
3416.700 |
2733.600 |
2314.300 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Revenue from Overseas Project and receipts from World Bank aided projects in Foreign Currency |
326.600 |
461.400 |
279.300 |
|
|
|
Earnings in foreign currency – FOB |
1190.900 |
2538.700 |
1506.800 |
|
|
|
Others |
18.300 |
10.200 |
20.100 |
|
|
TOTAL EARNINGS |
1535.800 |
3010.300 |
1806.200 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
277.100 |
113.500 |
40.300 |
|
|
|
Stores & Spares |
84.500 |
96.200 |
49.300 |
|
|
|
Capital Goods |
760.900 |
570.000 |
422.200 |
|
|
TOTAL IMPORTS |
1122.500 |
779.700 |
511.800 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
9.10 |
10.26 |
12.35 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2011 |
31.12.2011 |
31.03.2012 |
30.06.2012 |
|
Type |
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
4th
Quarter |
|
Sales Turnover |
11017.300 |
11846.900 |
18622.100 |
12621.500 |
|
Total Expenditure |
10072.200 |
11029.500 |
17026.900 |
11926.900 |
|
PBIDT (Excl
OI) |
945.100 |
817.400 |
1595.200 |
694.600 |
|
Other Income |
10.500 |
23.000 |
417.400 |
342.000 |
|
Operating
Profit |
955.600 |
840.400 |
212.600 |
1036.600 |
|
Interest |
577.600 |
506.000 |
780.800 |
950.500 |
|
Exceptional
Items |
(47.00) |
0.000 |
0.000 |
0.000 |
|
PBDT |
331.000 |
334.400 |
1231.800 |
86.100 |
|
Depreciation |
252.600 |
248.000 |
264.100 |
263.700 |
|
Profit
Before Tax |
78.400 |
86.400 |
967.700 |
(177.600) |
|
Tax |
36.900 |
76.200 |
396.300 |
18.500 |
|
Reported PAT |
41.500 |
10.200 |
571.400 |
(196.100) |
|
Extraordinary Items |
0.000 |
0.000 |
0.000 |
0.000 |
|
Prior Period Expenses |
0.000 |
0.000 |
0.000 |
0.000 |
|
Other Adjustments |
0.000 |
0.000 |
0.000 |
0.000 |
|
Net Profit |
41.500 |
10.200 |
571.400 |
(196.100) |
KEY RATIOS
|
PARTICULARS |
|
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
PAT / Total Income |
(%) |
2.12
|
2.78 |
3.80 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
3.18
|
4.73 |
5.74 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
2.78
|
3.96 |
4.91 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.08
|
0.11 |
0.13 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
2.09
|
1.85 |
1.82 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
2.19
|
1.84 |
1.74 |
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 |
(Yes) |
|
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 |
(No) |
|
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 Turnover of the Company on a standalone basis stood at Rs.56370.000 Millions for the year ended 31st March, 2011. The annualised percentage increase in turnover over previous year amounted to 24.33%. The order book position of the Company as on 31st March, 2011 was approximately Rs.156000.000 Millions.
On a consolidated basis the turnover of the Gammon group stood at Rs.88997.000 Millions for the year ended 31st March, 2011. The annualised percentage increase in turnover over previous year amounted to 25.11%.
FINANCE:
During the year the Company did not raise any funds from the capital markets either by way of issue of equity/ADRs/GDRs. The Company in its Board Meeting held on 9th July, 2009 had allotted 1,60,00,000 Equity Warrants convertible into Equity Shares (after receipt of 25% consideration as upfront payment at the time of allotment) to the Promoter Companies at a price of Rs.90.20/- per warrant. During the year under review, the Promoter Companies exercised their option for conversion of balance 82,50,000 Equity Warrants into Equity Shares by paying balance 75% of the consideration aggregating to Rs.558.100 Millions. These proceeds were utilized for meeting the working capital requirements, future expansion plans and CAPEX requirements.
The Company has also obtained financial assistance from its consortium bankers to meet its short term working capital requirements. During the year, the Company tied up Long term debt by way of issue of Secured Non-Convertible Debentures on private placement basis aggregating to Rs.1000.000 Millions. The total amount of outstanding Non-Convertible Debentures as on date is Rs.3775.000 Millions. The proceeds of debentures were utilized for the purposes for which they were raised.
MANAGEMENT DISCUSSION
AND ANALYSIS
OVERVIEW OF GAMMON
GROUP
Gammon India is amongst the largest physical infrastructure construction companies in India. Its track record spans significant landmark projects built over several decades, with a prominent presence across all sectors of civil engineering, design and construction. It has a track record of building landmark structures, some of which have become iconic. This includes ‘The Gateway of India’, the piling and civil foundation work which was successfully executed by Gammon as its maiden project way back in 1919.
Besides its large scale of operations in the Construction and Infrastructure domain, Gammon has a dominant presence in energy business in which it operates in the hydro, nuclear and thermal power sectors. In fact, Gammon’s association with the construction of nuclear power projects dates back to 1959 when it completed the Pre-Stresses Concrete (PSC) Ball Tank of India’s first Atomic Reactor Plant in Trombay. Gammon’s projects cover businesses and projects involving highways, public utilities, environmental engineering and marine structures. Gammon’s expertise also covers the design, financing, construction and operation of modern bridges, viaducts, and metro rail, both on a Built-Operate–Transfer (BOT) basis as well as contract execution. An example is the upcoming ‘Signature Bridge’ project in Wazirabad in North-West Delhi. This project would significantly help in the efficient flow and management of traffic in the region. Gammon is also active in the Social Infrastructure sector through its operations in the realty project segment. Examples include residential complexes such as Pebble Bay and Godrej WoodsMan Estate in Bangalore, Godrej Kalyan in Mumbai, RNA Exotica, Mumbai; Hotel complexes such as Hotel Leela Palace, Chennai and G Staad, Bangalore besides commercial complexes such as Galleria Mall (INXS) in Bangalore. Gammon is also currently undertaking a major project for ISKON at Sri Mayapur in West Bengal involving the construction of a temple complex and a modern cultural centre.
I. ECONOMIC OVERVIEW,
INDUSTRY STRUCTURE AND DEVELOPMENT:
The construction industry under the infrastructure domain has in the recent past received a significant trust thanks to an acknowledgment of its importance by the Government and policy makers as a key Owner of economic growth. Despite this the fiscal year 2010-11 did not witness the unbundling of the full potential of the sector. This was due to factors both internal and external to the industry and the country. Externally the impact of global slowdown and consequent limitations of funding through the FII and the FDI route was a dampener for accelerated economic growth on the sector. Internally, factors of inflation combined with rising interest rates posed challenges to mobilization of resources, a key requirement for large scale projects, covering civil, industrial structures, power transportation and related infrastructure linked areas. The encouraging signals, of course, are the governments’ commitment to infrastructure as a prime driver of the nation’s economic growth agenda. This would necessarily have to adopt the proven Public Private Partnership (PPP) Model. This will involve the private sector as a key stake holder so as to ensure that the plans translate to visible and time bound actions at the ground level. Indeed, the success of the PPP model in the modernisation of the country’s major airports and some key national highway projects are encouraging. The involvement of the private sector would also hopefully focus on the critical aspect of improving operational efficiencies by adopting relevant and modern techniques in the information technology domain. The Company has consciously decided to focus on these areas to remain competitive and capable to tap encouraging market opportunities in the construction sector which despite, very many challenges, is expected to clock a healthy 9% annual growth, against a global average growth of just over 5% for the sector. The global slowdown thus presents an opportunity for attracting large investment into the country at a time when the emerging economies with India as a key player are increasingly becoming the focus of financial and industrial activity.
II. SPECTRUM
OF ACTIVITY AND REVIEW OF PERFORMANCE:
Besides the range of executed projects, the order-book position becomes a lead indicator of a Company’s growth trends. Given the scale, size and lead times in the construction and civil engineering projects, this does help in assessing the Company’s potential for consolidating and sustaining its growth. The Company’s Order-book position, as of March 31, 2011, stood at Rs.156000.000 Millions.
Transportation
Engineering:
The Company is engaged in the design and construction of projects spanning roads, bridges, flyovers, metro railway systems, marine structures, ports and airports.
(a) Roads:
The Indian road network has grown tremendously since 1950. The total road length has increased from 0.4 million km (1950) to 3.32 million km (2010), making India the third largest road network in the world after USA and China. Indian road network comprises of national highways and expressways, state highways, major district roads (MDRs), other district roads (ODRs), village and rural roads.
The Empowered groups of ministers (EGoM) for roads and highways have given an in-principle approval for converting 10,000 km. of state highway into national highways. Although approval was given in March 2010, the exact stretches are yet to be identified. The Company would be participating in this development on a major scale.
The Company is looking forward to participating in a wide range of Public private partnership projects. States such as Madhya Pradesh, Andhra Pradesh and Maharashtra have encouraging number of PPP based state highway projects under implementation. Meanwhile, over a dozen states have also set up their PPP cells and are drafting their respective PPP policies. All these bode well for the sector and the Company’s future.
In the near future, Gammon India would also be actively participating in the mega highways and expressway development programmes launched by NHAI. The authority has planned 10 mega highway projects of each around 500 km. and worth Rs.45-50 billion. NHAI also plans to develop 10,000 km. of expressways under phase VI of the National Highway Development Programme. Besides the MoRTH has approved development of 18,637 km. of greenfield expressways across the country. All these projects will be taken up on a build-operate-transfer (BOT) toll basis and are expected to be completed by 2022.
Some of the Current
Projects in progress are:
- Agra Makhanpur Road Works valued at Rs.3284.900 Millions.
- Gajol - Hilli Road Project valued at Rs.2230.000 Millions.
- Gorakhpur Bypass (BOT) valued at Rs.5600.000 Millions.
- Nasik Road Works valued at Rs.6210.000 Millions.
- Bihar Road Works BR3 valued at Rs.3565.100 Millions.
- Arunachal Road Works (SEPPA ROAD) valued at Rs.875.500 Millions.
- Patna Hazipur-Muzaffarpur Road (PATNA HAZIPUR -
MUZAFFARPUR BYPASS ROAD) valued at Rs.7500.000 Millions
- Dumuria Ranitalab Road Works (SH-69) (DUMURIA RANITALAO
ROAD) valued at Rs.3135.000 Millions.
- Gaya Rajauli Road Works (SH-70) valued at Rs.1055.100 Millions.
- Karnataka Road Works - Package 4/5 (TUMKUR HAVERI ROAD
PROJECT NH-4) valued at Rs.4042.200 Millions
(b) Bridges, Metro
Viaducts and Flyovers:
In spite of its prominent role in Indian economy, urban India faces serious problems due to population pressure, deterioration in the physical environment and quality of life. Traffic congestion has assumed critical dimensions in many metropolitan cities due to massive increase in the number of personal vehicles, inadequate road space and lack of public transport. Government has accorded highest priority to improving urban infrastructure by giving a boost to Metro Rail in almost all metropolitan cities of the country. The dedicated Freight Corridor Corporation of India will offer new opportunities for bridges, Rail track laying, signaling and Telecommunications approximately valued at Rs.50000.000 Millions. The Delhi, Chennai, Kolkata and Bangalore Metro Rail Projects offer new opportunities for Metro Construction and Metro viaduct. The Company has secured contract valued at Rs.19473.000 Millions for Execution of Contract UAA-02 and Contract UAA-03, of the Chennai Metro Project.
Projects secured
during the year are:
(1) Surat Cable Stayed Bridge, valued at Rs.1436.500 Millions.
(2) Pune Flyover at Kalewadi Phata, valued at Rs.994.200 Millions.
(3) Development of Rail Infrastructure from Lapanga Station to Hindalco Alumina Plant Site of M/s Aditya Aluminium, valued at Rs.402.000 Millions.
48
The
Company completed the following Projects during the year:
(1) Elevated Road Project at Amritsar valued at Rs.2160.000 Millions for Design and Construction of 2-Lane Elevated Road from G.T. Road to Golden Temple and 4-Lane Elevated Road on G.T. Road from Maqbulpura Chowk to Bhandari Pul.
(2) Contract No. BC 25, 27, 28, 29 and 30R of Delhi Metro Rail Corporation, valued at Rs.3150.000 Millions.
(3) DDA Flyover at Bund Road, Near Commonwealth Games Village completed ahead of schedule and opened to traffic before Commonwealth Games.
(4) Elevated Viaduct for Bangalore Metro Rail.
Some of the projects
under execution are:
(1) Signature Bridge Project, valued at Rs.6320.000 Millions for Construction of Main Cable Stayed Bridge over Yamuna River at Wazirabad, Delhi. The bridge will have a dual carriage way of 4-Lanes each. Length of main bridge is 575 mts. with extension of 112 meters. The height of the pylon is 151 mts. Above the deck level.
(2) Bongaigaon TT Foundation, valued at Rs.630.000 Millions for Construction of Pile and Well Foundation Package for River Crossing Location for 440 KV D/C Byrnihat-Bongaigaon Section of Palatana- Bongaigaon Transmission Line Associated with 726.6 MW Gas Based Power Plant at Palatana, Tripura.
(3) Munger Bridge, valued at Rs.3630.000 Millions for Construction of Steel Super Structure and Other Ancillary Works of Rail-cum-Road Bridge across River Ganga at Munger.
(4) Bogibheel Bridge, valued at Rs.3630.000 Millions across River Brahmaputra Near Dibrugarh.
(5) Kosi Bridge, valued at approximately Rs.3680.000 Millions for design, construction, finance, operation and maintenance of four lane Bridge across River Kosi including its approaches on NH-57 on Annuity Basis.
(6) Godavari Bridge at Rajahmundry, valued at Rs.7000.000 Millions Design, Construction, Finance, Operation and Maintenance of major Bridge across River Godavari on Rajahmundry side.
(7) Contract from Kolkata Metro Rail Corporation (valued at Rs.2120.000 Millions) for Design and Construction of 4.725 km. viaduct and portals for junction arrangement for future link to airport (elevated section) of East West Corridor of Kolkata Metro excluding viaduct at stations namely salt lake stadium, Bengal Chemical, City centre, Central park, Karunamoyee and Salt lake sector-V each of length 140 mts., on Subhash Sarobar to Salt lake Sector-V.
(8) Wazirabad Bridge Project at Delhi, valued at Rs.3600.000 Millions for Construction of major bridge and its approaches cross River Yamuna downstream of existing bridge at Wazirabad-Delhi.
(c) Ports:
The Indian coastline is dotted with 12 major ports and 187 minor ports. India has one of the largest merchant shipping fleet and is ranked 16th among the maritime countries. Indian shipbuilding industry currently accounts for about One per cent of the global shipbuilding market and is targeting a world share of 5 per cent by 2017. The Company is currently executing the project for design, engineering, procurement and construction of Offshore Terminal for Mumbai Port Trust, valued at Rs.4360.000 Millions.
2. Power sector –
Economic Scenario:
Availability and access to energy are considered as catalysts for economic growth. The envisaged growth of the economy at 9% in the Eleventh Plan cannot be achieved without a commensurate increase in the availability of energy. At the end of 10th year plan there was 13% deficit in the peak load demand of electricity. The National Electricity Policy envisages “Power for all by 2012” and per capita availability of power to be increased to over 1,000 units.. With reference to the Ministry of Power’s reports the Working Group on Power has recommended a plan size of about 82,200 MW for 12th Plan also. This would comprise hydro projects totaling about 30,000 MW, thermal projects totaling 42,200 MW and nuclear projects of about 10,000 MW capacities.
Industrial/Power
Structure and Development:
Gammon has consolidated its position in this sector on account of the growth. The increase in demand of electricity and time bound implementations of various projects have helped in realising better output for the resources deployed. This is becoming one of the most important sector in the Company’s growth agenda.
(a) Thermal power:
In the present situation thermal power generation is 65% of the total power generation capacity. Government is encouraging private players to be partner in the power sector development and the sector is de-licensed. This augurs well for the Company.
Projects under execution by the Company are
|
Sr. No. |
Scope |
Value (Rs. in Millions) |
|
1. |
Civil Works and Structural Works For 3300 Mw TPP at Tiroda, Maharashtra |
3500.000 |
|
2. |
Main Plant and Offsite Civil works Pkg. for 3 x 500 Mw Vallur TPP, Tamil Nadu |
4460.000 |
|
3. |
Civil and Structural Steel Works for 2 x 600 Mw TPP Near Tuticorin in Tamil Nadu |
4000.000 |
The general outlook of the sector is positive with availability of quality resources and competent human resource. The sector is becoming highly competitive as the risks involved are minimal.
(b) Hydro power:
India's energy portfolio today depends heavily on coal-based thermal energy, with hydropower accounting for only 26 percent of total power generation. The Government of India has set the target for India's optimum power system mix at 40 percent from hydropower and 60 percent from other sources. Though the government is emphasizing on the development of this renewable energy sector, there are many road blocks for conceiving any new Hydro Electric project. The main reasons for the slow development are difficult and inaccessible potential sites, land acquisition and rehabilitation, environmental clearance and political and local agitation. Government has amended its Hydro policy to reduce the gestation period of the project and encouraging the private players to be partner in the development of the sector. Some of the Hydro Power projects being executed by the Company are as follows:
|
Project |
Scope |
Job Value Rs. in Millions |
|
Parbati HE Stage 2 |
Construction Civil Works for LOT PB-3 containing HRT 6.638 km. long, Adit of total length 905 mts., Surge Shaft, Pressure Shaft, Valve Gallery, Pothead Yard, Tail Race Works and Hydro Mechanical Works of Surge Shaft, Tail Race, Penstock steel liner and inspection gates. |
7990.000 |
|
Sewa HEP |
Construction of Civil Works for Lot SW.1 of SEWA H.E. Project, Stage - II, Jammu and Kashmir, consisting of Diversion Tunnel, Coffer Dams, Concrete Gravity Dam, Desilting Chamber, HRT and Associated Works |
1960.000 |
|
Koldam HE Project |
Construction of Power House, Tail Race Channel, Service Building and Maintenance, Bay Work and Penstock Tunnel work including Design, Fabrication, Erection, testing, commissioning of four Penstock linear etc, including all labour, plant, equipment and material for execution of civil and structural works and associated miscellaneous works. |
2190.000 |
|
Parbati stage 3 |
Construction of Civil Works for Lot PB III, consisting of Head Works, Power Intake , Head Race Tunnel, Surge Shaft and Pressure Shaft, Waterways, Down streams of Units, Power Station Civil Works, Cable Cum Ventilation Tunnel, Pothead Yard |
2910.000 |
|
Rampur HEP |
Construction of Civil Works for HRT from Station 15.61 mts. to Station 12,900 mts. including Cut and Cover section, River Diversion works, Adits, Vehicular Gates etc for PKG-I of Rampur HE Project. |
6830.000 |
|
Bhutan HEP |
Construction of Head Race Tunnel 10 mts. finished Dia of about 7.5 km. length and two Adits cumulative length of about 657 mts. |
4000.000 |
(c) Nuclear Power:
Nuclear projects totaling to 3,380 MW have been proposed for during 11th plan. Out of this, 220 MW (Kaiga U-3) has already been commissioned and the remaining projects are under construction which includes India's first fast breeder reactor project at Kalpakkam. Gammon has completed the civil works of this fast bread reactor and other BOP structures. Company has also secured the job of construction of administrative building package from IGCAR near Kalpakkam.
India has a flourishing and largely indigenous nuclear power program and expects to have 20,000 MW nuclear capacities on line by 2020 and 63,000 Mw by 2032. It aims to supply 25% of electricity from nuclear power by 2050. There are huge developments happening in recent years and the company already has the prequalification criteria to secure the new contracts. Due to huge capital investments and long gestation period and clearance from various statutory bodies, there is delay in start up of these projects.
Projects secured in the current financial year are as below:
|
Sr. No. |
Project |
Value Rs. in Millions |
|
1. |
Construction of Phase-11 Buildings for IGCAR |
760.000 |
|
2. |
Turbine Bldg and Balance of Plants for 500 MWe PFBR, Kalpakkam |
810.000 |
3. Pipeline Division:
The Pipeline Division of the Company has been performing as a single point service provider in the Cross Country Pipeline Sector. The division is capable of executing both item rate and lump sum contracts in India and overseas.
During the financial year 2010-11, this division has successfully completed the following projects worth Rs.1640.000 Millions.
- Duliajan Numaligarh Pipeline Project of M/s. DNP Limited, Assam.
- Composite Works for Raman Mandi Pumping Station of M/s. Hindustan Petroleum Corp. Limited
- Raman Mandi Bhatinda Bahadurgarh Pipeline Project of M/s. Hindustan Petroleum Corp. Limited
- Kandla Samakhaili Pipeline Project of M/s. GAIL India Limited.
Some of the Projects
under execution include:
- Brahmaputra Pipeline Project of M/s. Brahmaputra Crackers and Polymers Limited.
- Bahadurgarh Tikrikalan Pipeline Project of M/s. Hindustan Petroleum Corp. Limited
After the successive completion of composite works at Raman Mandi Pumping Station, Gammon India is now qualified for the handling of Refinery Piping and Equipment Erection of major pipeline Projects.
4. Water and Environment:
The Infrastructure Industry in the country is witnessing a growing demand in the water and environment sector which has tremendous opportunities. The Central Public Health and Environmental Engineering Organization Estimates an investment requirement of Rs.1.73 trillion for meeting 100% coverage of safe water supply and sanitation services by 2021 in the country. The Jawaharlal Nehru National Urban and Rural Management (JNNURM) allocations for water related projects are the highest. Water related projects form 63% of the total number of approved projects and 74% of the total approved cost.
With the growing priority of the government to this sector, Gammon India will be an active participant and has targeted projects valued at Rs.13000.000 Millions in this sector.
- Currently, only 75% of the rural population and 85% of the urban population have access to public water supplies. However, municipal agencies in many Indian towns and cities are unable to increase their water supply capacities to match population growth, especially in the urban areas. The water requirement for industrial use alone is expected to quadruple from the current 30 billion cubic meters to 120 billion cubic meters, by 2025.
- The Central Public Health and Environmental Engineering estimates an Investment requirement of ? 1.73 trillion for meeting 100% coverage of safe water supply and sanitation services by 2021.
About 55% of the resources are likely to be mobilised through Programmes of the Union Government, 28% through State Outlays, 8% through institutional financing, 8% through assistance from external agencies, and the remaining 1% through PPPs.
• Growing urbanization has also resulted in large scale increase in pollution in cities all over the country which has led to growth of Treatment Plants for abatement of growing pollution in the river water sources. This is another area of opportunity for the company. Newer technologies like Membrane Technology, Reverse Osmosis are emerging trends which progressive companies engaged in the sector will bring to the table.
Some of the Projects under execution include:
|
Sr. No |
Name of the Project |
Estimated Cost (Rs. in Millions) |
|
1. |
Design Build Contract with Operation and Maintenance for 3 yeas for Distribution MS/DI/PVC/HDPE Pipeline U/g. sumps ESRs, Staff quarters, compound wall and Pump House, Pumping Machineries with OandM for 3 years integrated Water Supply Scheme Phase-II, Part-II Based on Sardar Sarovar Canal Based. |
1074.500 |
|
2. |
Design Construction of a complete new 107 MLD capacity Potable Water Supply Infrastructure project on Turnkey Basis for Guwahati City. |
3497.000 |
|
3. |
Procurement of works (Item rate) for Supply, Installation, Construction and Commissioning of Rising and Transmission Main (Gravity Mains, Pressure Mains) Reservoirs for South Central Zone. |
1757.100 |
|
4. |
Bangalore Water Supply and Sewerage Project - Procurement, Fabrication and Laying of Clear Water Trunk main from Vajarahalli to HBR on the east of Bangalore. |
3094.600 |
|
5. |
Design, Engineering, Supply, Erection and Commissioning of Raw Water Intake project at Brahamana Gaon near Marthapur on Turnkey Basis. |
337.500 |
|
6. |
Design Build Operate Contract for Distribution Network for Narmada Canal Wankaner Group Water Supply Scheme of Wankaner, Rajkot District. |
1082.800 |
|
7. |
EPC Contract of Jindal Intake Well at Brahmani River. |
435.000 |
5. Chimneys and
Cooling Towers:
Chimneys:
Gammon has completed projects like Bellary TPS, Jhajjar Unit -1, Simhadri Unit-3, Jaigad TPS Chimneys, Seepco Jharsuguda in the last financial year. During the same period, the Company has also secured good number of orders from our valued clients like, Indiabulls Power, Nasik and Amravati Chimneys, GMR Tilda Power Project NDCT and Chimneys, JITPL Angul Civil Works and Chimneys, Aditya Birla Group Sambalpur Chimneys, Sasan Civil and Dredging works and IGCAR Buildings.
Cooling Towers:
Gactel Turnkey Projects Limited (GTPL) (formerly Gammon Cooling Towers Limited) is a subsidiary of Gammon India and has been created to focus on Domestic and International markets for Cooling Towers and Cooling Systems. GTPL, in fact, is a sustained effort by Gammon to accumulate Experts from Cooling Towers Industry under a single roof.
GTPL's gamut of activities includes Concrete Cooling Towers, Pultruded FRP Cooling Towers, Conversion of Existing Timber Cooling Towers to Pultruded FRP Cooling Towers, Air Cooled Steam Condensers, Air Cooled Heat Exchangers and Customer services such as Refurbishment, Thermal and Structural upgradation and so on. GTPL is playing a major role in the process industry with its customized cooling solutions.
GTPL is well equipped to meet the customized requirements of the clients with an in-house team of more than 100 engineers from various disciplines dedicated to deliver solutions in Thermal, Mechanical, Electrical, Hydraulic, Instrumentation and Civil Engineering.
In FY 2010-11, GTPL has recorded an order book of approx Rs.1700.000 Millions by winning Cooling Tower projects from many prestigious clients such as Hindustan Petroleum Corporation Limited, Adani Infra India Limited, Lanco Infratech Limited, Vandana Vidhyut Limited, Jindal Steel and Power Limited, ONGC Petro Additions Limited, Mangalore Refinery and Petrochemicals Limited and many others.
The value of work executed during the year 2010-11 was Rs.5190.000 Millions and the value of work in hand as on April 1, 2011 was Rs.18940.000 Millions.
6. Industrial
Structures:
The Company has secured industrial structure projects to the tune of Rs.2340.000 Millions (excluding the job secured for civil works in thermal power industry). Industrial structure constructions are fast track jobs as the infrastructure is directly linked to the planned production. Some of the projects under execution are:
|
Sr. No. |
Project |
Value Rs. In Millions) |
|
1 |
Civil works for Beneficiation Plant #2 Phase II |
110.000 |
|
2 |
Sea Water Intake and Out fall system - civil works for Coastal Energen (2X600 MW) TPP at Tuticorin |
350.000 |
|
3 |
Dahej - Piling works |
950.000 |
|
4 |
Civil works for CW works for Nevyeli Lignite Corporation Limited |
230.000 |
|
5 |
CDQ and CRM-II (Part-2) Plant civil /Structural works Bellary |
630.000 |
7. Transmission and
Distribution Business:
The Transmission and Distribution (T and D) business of the Company operates on Engineering Procurement Construction (EPC) basis in power transmission and distribution sector. With its execution capacities, large manufacturing capabilities for Transmission Tower and Conductor and Customer focus the Company is recognised as a leading player in India.
The Company has also been expanding its footings into overseas countries and executing EPC contracts in Algeria, Kenya, Afghanistan and also supplying towers to Nigeria, Ethiopia, Ghana, Sri Lanka, Oman, etc. With the thrust on privatization of Transmission Lines involving large investments in BOOT / BOO basis, the division is well positioned to capture the business opportunity having large manufacturing capacity for towers as well as conductors.
To cater to the ever growing power consumption, rapid industrialization and huge energy deficit, the Government of India had planned to make large capital expenditure in the 11th Five Year Plan in the Power Generation, Transmission and Distribution segments and set a target of adding about 78,000 MW of additional capacity. This will enable the Company to cater to the ever growing demand of power transmission and distribution.
Government had initiated several Schemes including Accelerated Power Development and Reforms Programme (APDRP) and the Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) for bringing about qualitative improvements of the power distribution systems and electrification of all rural households and villages in India. The electrical energy requirement is expected to grow about 8% per annum.
The Company is also looking for international opportunities in transmission and distribution business in Africa, Middle East and Central Asia.
With the addition of third tower manufacturing plant at Deoli, Wardha district, the capacity has been enhanced to 110,000 MT per annum. In addition to this, state of the art Tower Testing Station (R and D Centre) to test towers up to 1,200 kv has been set up at Deoli.
During the year, the Company successfully commissioned seven projects covering more than 748 kms transmission lines of 765 and 400 kv and 2,441 km of distribution lines. The Company also tested 735 kv towers for Canada and 400 kv Towers for Indian clients.
During the year, the Company was successful in securing transmission line orders for more than 1,375 kms in various voltage classes from domestic and overseas markets.
The Company has also forayed into manufacturing of high mast poles with the setting up of its subsidiary, Transrail Lighting Limited (TLL) which was commissioned in September 2010. The Company has in-house design, pole manufacturing capacity of 30,000 MT per annum which are required for Street Lights, Telecom, Stadiums, power transmission and distribution etc.
In India the transmission business of the Company mainly comes from Central utilities, State utilities and Private Sector clients.
The Company sees immense opportunities in the emerging markets such as Africa and Middle East on account of need for better power transmission network, funding support from multilateral agencies, power generation plans and spending by oil producing countries. The Company has adopted the route of forming subsidiaries and JV overseas to enter into newer markets with its subsidiary SAE Power Lines S.r.l., Italy which has been the global player in T and D sector.
With large Engineering set up, modern testing station and large manufacturing capabilities, the Company is looking for Tower and Conductor supply opportunities in the United States and Canada.
8. International Business:
Going forward, the organisation's strategy would be to expand its span and presence across its business especially in respect to the Energy and Real Estate space. Towards this, the Company is gearing its competitiveness so as to be a one-stop EPC resource entity and a total surplus provide across the energy value chain. The partnership with Brookfield Multiplex, Canada for strengthening resource and execution competencies in the real estate space is an example of the Company's focus on broad-basing its international presence and capabilities across its various business functions.
Sofinter Group:
Group Sofinter entered into a new Loan Agreement with the Italian banking system on 1st December 2009 but the actual financing under this document commenced in second quarter of 2010. Thereafter the two main revenue generating companies of the Group i.e. Sofinter S.p.A. and Ansaldo Caldaie S.p.A. were able to begin to return to the international markets for undertaking new orders.
The turnover of the Group was therefore considerably restricted mainly to the delivery of backlog orders which also in some cases were delayed due to the above delay in opening of banks lines. The economic crisis internationally, including in different parts of Europe, added to the general overall problems within the Group, especially in Ansaldo Caldaie which operates in the utility power plant segment, and is therefore more susceptible to economic trends.
Notwithstanding the above constraint, the consolidated turnover of Sofinter for the year 2010 closed with revenues of approximately 300.48 million Euro (previous year 446.40 million Euro), EBITDA of Euro 16.3 million (previous year 26.83 million Euro) and a Net Result of - 3.9 million Euros (previous year Euro - 411.588). These results were after providing an additional amount of Euro 9 million for contract risks provision, compared to the previous accounting year. Further a loss of approximately 4 million Euro relating to the operations of the resurge oriented company ITEA has been recognized during this period. A large part of this improvement in working result arose on account of tighter control of costs across all operations and continuous streamlining of procedures and processes across the company.
Sofinter (Macchi Division and SWS Division), Ansaldo Caldaie S.p.A and ITEA are the principal companies of the Sofinter Group.
Sofinter S.p.A.
(Macchi Division and SWS Division),
The Macchi Division principally operates in the Oil and Gas industry and the major Oil producing nations are its principle markets. The projects of Macchi are principally accessed through global EPC contractors. In 2010 Macchi considerably consolidated its market position and its leadership position in the industrial boiler segment continues to remain and grow. As a further business opportunity, Macchi is expanding its service business by creating the necessary support centers at different location across its principle markets.
The SWS division operates in parallel with the Macchi division and is in the segment of water treatment with particular emphasis on desalination plants.
Sofinter S.p.A. recorded a turnover of 118 million Euro (previous year 156 million Euro), EBITDA of Euro 7.08 million (previous year Euro 19 million) and a net result of Euro 1.9 million (previous year 6.5 million Euro). The closing order book of Sofinter S.p.A. as of 31st December, 2010 was approximately Euro 160 millions.
Ansaldo Caldaie
S.p.A.
Ansaldo Caldaie S.p.A. is in the utility power plant segment. Apart from the European market, the traditional market for the company has been in the Middle-East, which is witnessing varied degrees of political instability. This factor, coupled with the economic slow-down and delay in opening of bank lines, impacted the order booking of the company during 2010 and also resulted in a slow-down on the execution of some of the principle orders. The entry of its affiliate company Ansaldo Caldaie Boilers India Private Limited into the supercritical boilers segment has got further delayed due to the pending litigation with NTPC in the Supreme Court of India. This delay has further affected the business plan of the company but it is hopeful that the favorable outcome in respect of the litigation at the level of the High Court would further get up held by the honorable Supreme Court in the days to come. Notwithstanding this setback with NTPC, the Company is offering jointly with Ansaldo Caldaie Boilers India Private Limited into several other Indian clients and it is expected that it would meet with success in this respect during the current year 2011.
Ansaldo Caldaie closed the financial year 2010 with revenues of Euro 128 million (previous year Euro 222 million) EBITDA of Euro 9.65 million (Previous year Euro 4.936 million) and net result of Euro 0.4 million (previous year Euro 4.9 million).
In order to stabilize its operations and further improve its performance, including its chances of winning orders in low cost countries, the company has embarked on a global procurement strategy which would allow it to source components and services from suppliers in low cost areas. Additionally the company has further strengthened its service activities by localizing the same through dedicated entities in different markets, which is already beginning to show results.
In order to further exploit the Indian market in the mid-size segment, the Company is also jointly offering with Gammon Group company Franco Tosi Meccanica S.p.A. for complete BTF Packages in this segment.
The portfolio of the company as at 31st December 2010 was approximately of Euro 165 million. However the company has a robust backlog of offers of over 1.5 billion Euro, many of which are expected to have a high rate of success.
ITEA S.p.A.
This company is dedicated to research activities in generation of clean power using coal, waste and biomass. While the company has completed most of the technical intervention necessary to optimize the performance of the plant using waste, it is still occupied with the development phase of the ISOTHERM PWR® plant for oxy combustion in the coal sector.
However the results so far achieved and the unexpected development in the energy segment as a result of the nuclear accident in Japan will have a positive impact on the future of ITEA technology and the company is already witnessing a greater keenness being shown by utility companies in developed nations to commercially exploit this technology locally. Negotiations have already commenced in this respect with major utility companies in the United States of America.
For the year 2010 ITEA closed with a significant loss of approximately Euro 4 millions (previous year loss of approximately Euro 5 millions).
Group Sofinter is expected to clock revenues of Euro 278.1 million during 2011, with a net result of approximately Euro 0.1 million. The Group is in an advanced stage of further enhancing credit lines with the Banks to meet its Plans up to December 2014, against further capital infusion of Euro 18 million, for which the participation of a new investor with a minority stake in Sofinter is under implementation.
Franco Tosi Meccanica
S.p.A:
The Company in the financial year 2010 has further consolidated its position in the market as a quality manufacturer of power generation equipment. New orders were booked during the year amounting to Euro 197,9 million in comparison to Euro 181,4 million of the preceding year and almost tripled in comparison to Euro 68,4 million in 2008 when the Gammon Group acquired the Company. Two of the most important orders bagged by the company in FY 2010 were from Petrobas (Brazil) for the supply of 3 steam turbo-generators amounting to Euro 36,2 million and from Enel Nicaragua for the rehabilitation of 2 power plants amounting to Euro 39.7 million, which confirmed the good positioning of the Company in the fast growing Latin-American market. The Company has been strongly impacted with the cancellation by the customer "Hydrogen Energy International Limited" and "Future Abu Dhabi Energy Company" of the contract for the supply of 1 x 260 MW steam turbine amounting to Euro 43,7 million for temporary lack of financial coverage, due to the persistent credit freeze by the banking system. Despite the cancellation of the orders the company has maintained a very interesting backlog of over Euro 310 million. As mentioned above the difficulty in obtaining timely credit facilities from the Italian banking system and the delay in tying up for support from banks outside Italy led to a lower volume of production and consequently a lower turnover of Euro 68.26 million (Euro 92.03 million in 2009).
The operative margin for financial year 2010 is comparable to 2009 if the impact of Port Sudan Project is not considered. Also a substantial reduction of overall risk funds for Euro 4.2 million has been a significant achievement of Project Management in 2010. The year also started with streamlined global procurement activity and its full benefit will be in the years to come. The financial year 2010 closed with a negative result of Euro 15.583K in comparison to a positive result of Euro 176K of 2009.
The implementation of the plan involving activities to improve performance of production is in progress, with the aim to (i) Reduce costs, (ii) Improve Quality and (iii) Improve the service granted to the Client. Continuous reduction in costs is being pursued through optimization of the high value activities carried out in the shops, the continuous analysis of production activities the adoption of a lean manufacturing organization and layout revision.
SAE Power Lines
S.r.L.:
The activities of the Company relating to the fabrication and erection of transmission towers and lines continues to be steady with adequate and promising prospects as they look ahead. This is despite the pressure on liquidity in the global markets which would also have an impact in the emerging markets. However the prospects of good opportunities over the medium to long-term especially in markets in North East and West Africa are encouraging as also in the emerging markets including India, Brazil and the Middle East. The Company is continuing its focus on good market opportunities in the United States of America as well as Mexico for the future for all its products and services.
During the calendar year 2010, the Company recorded a turnover of Euro 32.02 million, an EBITDA of Euro 1.96 million and PAT of Euro 4.60 million.
Further, the year end order book was Euro 56 million. Additionally the company is well positioned on its bids which are approximately in the range of Euro 55 million.
Oil and Gas - Campo
Puma Oriente S.A.:
The Puma Block is located in Ecuador's Oriente Basin, 50 km south of Puerto Francisco de Orellana approximately 400 Km east of Quito awarded to Pegaso Consortium (Gammon India Limited through Campo Puma Oriente S.A. has a share of 66.4% in the consortium). The contract was originally established as a Production Sharing Contract, which entitled the contractor to a share on the incremental production above an established base production output. After a reform on the Hydrocarbon Law on 2010, all operators in Ecuador had to undergo a contract renegotiation process to migrate to the newly established Service Contract model. The revised Puma Block contract was signed and registered on February 1st, 2011 for an 18 year term. The primary objective of the project is the exploration, development, and production of hydrocarbons in the Puma Block through a Service Contract signed with the Ecuadorian government. From the beginning of the Block's development in late 2008, 90% of all production facilities have been built and are currently in operation; 7 wells have been drilled and are currently producing with a 100% success rate on development well drilling. Puma Block is currently producing an average of 1,800 barrels of oil per day. 15 km. of 2D seismic were surveyed during late 2010, which will provide for valuable information regarding the reservoir currently in production. Based on this information, 2 additional development wells will be drilled between late 2011, and early 2012 to increase production.
The total investment plan for the initial stage of Puma Block's exploration and development (2008 - 2015) is USD 100.6 million Out of the total project cost described in the previous section, the Consortium has invested USD 49.9 million as of December 31st, 2010.
The estimated production output for the Puma Block's current developed and producing field is 1,800 barrels per day for the remaining contractual term (2011 - 2028), is a total recovery of 11 million barrels. This implies a 20% recovery factor over a total 50 million barrels estimated Original Oil in Place. This development considers 9 currently drilled wells plus 2 additional development wells. At a Service Fee of $21.1/barrel, as established in the new Service Contract, the total resource pool created by the project is $232 million.
9. Real Estate Business:
Real estate, a "sunshine industry" in India, is flourishing rapidly, propelled by strong demand drivers and significant transformations such as deregulation of the sector, increasing transparency and professionalism, improved product quality and service standards etc.
Further, the housing sector has been growing at an average of 34% annually, while the hospitality industry witnessed a growth of 10-15% last year. Apart from the huge demand, India also scores on the construction front. The importance of the Real Estate sector, as an engine of the nation's growth, can be gauged from the fact that it is the second largest employer next only to agriculture.
Gammon Realty Limited which principally functions as the Real Estate arm of Gammon India Limited has forayed in to varied Real Estate developments in the past few years with strategic decisions being taken to increase land bank thereby positioning itself to become a major Real Estate player in the coming years.
OUTLOOK:
The Company is well placed to continue to lead the Real Estate industry in India and has multiple opportunities for growth and diversification across all lines of business.
Key priorities going forward include focusing on execution of current and planned projects, building a pan-Indian presence, expanding into new consumer segments, pursuing new business opportunities and achieving the highest standards of professionalism, ethics and customer service. Investment in property is believed to be the smartest move as chances of loss is negligible. The growth graph of the Real Estate Sector is observed to be escalating day by day.
There has been a substantial increase in the Company's Land Bank with a development potential of more than 3 million square feet, of which a major portion is in the Metro and Super Metro regions. This transformation has been made possible through a series of bold and far-sighted decisions aimed at enhancing their internal corporate efficiency and upgrading their capabilities for project implementation and delivery in tune with global standards.
The Company has over the years through its subsidiaries acquired substantial presence in the Real Estate Sector across India. The following subsidiaries of Gammon are active in this segment:
- Metropolitan Infra-housing Private Limited: Acquired 180 Acres of Land in auction within the limits of Municipal Corporation of Kalyan and Dombivali. The land was acquired at total cost of Rs.7260.000 Millions. The land belonged to the erstwhile Pal Peugeot Limited, and is proposed to be developed as a Township Project.
- Deepmala Infrastructure Private Limited: A subsidiary of the Company was incorporated as a Special Purpose Vehicle for execution of Central Business District at Bhopal. The project involves Procurement, Finance, Construction, and Development of 15 Acres of prime area in South TT Nagar Bhopal. It is a PPP project with lease period of 30 years extendable thereafter for another 30 years at no additional costs.
- Preeti Townships Private Limited: Another subsidiary is holding 15 Acres of Land within the limits of Municipal Corporation of Kalyan and Dombivali.
- The Company has entered into Joint Venture Agreement with Multiplex Constructions India Private Limited, an Indian arm of Brookfield Multiplex for construction of High Rise structures both residential and commercial. The innovations at Brookfield and quality standards of Gammon complement each other for a sustained relationship in the field of Real Estate.
- Gammon Realty Limited has in the recent past also quoted some Re-development tenders and is well placed in acquiring some of these jobs which will mark a foray of Gammon Realty in to the field of redevelopment.
CONTINGENT LIABILITIES:
Rs. In Millions
|
Particular |
31.03.2011 |
31.03.2010 |
|
1. Liability on contracts remaining to be executed on Capital Accounts |
125.900 |
738.300 |
|
2. Counter Guarantees given to Bankers for Guarantees given by them and Corporate Guarantees, on behalf of subsidiary, erstwhile subsidiary, associate Companies stand at |
65319.600 |
54364.100 |
|
3. Corporate Guarantees and Counter Guarantees given to Bankers towards Company’s share in the Joint Ventures for guarantees given by them to the Joint Venture Project Clients |
5563.100 |
4633.600 |
|
4. Disputed Sales Tax liability for which the Company has gone into Appeal is |
246.600 |
238.800 |
|
5. Claims against the Company not acknowledged as debts |
472.600 |
477.600 |
|
6. Disputed Excise Duty Liability |
0.300 |
0.300 |
|
7. Disputed Customs Duty Liability |
3.200 |
3.200 |
|
8. Disputed Service Tax Liability |
186.100 |
292.100 |
|
9. Contingent Liability on partly paid shares |
-- |
-- |
10. There is a disputed demand of UCO Bank pending since 1986, of US$ 436,251 i.e. Rs.17.200 Millions. Against this, UCO Bank has unilaterally adjusted the Company’s Fixed Deposit of US$ 30,584 i.e. Rs.1.200 Millions, which adjustment has not been accepted by the Company.
11. The Company had deposited customs duty of Rs.22.000 Millions under protest in respect of certain machineries imported for the project in Sikkim. The Company contends that the import of machinery is duty free as per the Project Import regulations prevailing then. The Company has preferred an appeal against the levy of Custom Duty. Pending outcome of the appeal, the said amount is carried under Advances recoverable in cash or in kind.
12. In respect of Joint Venture and operations in Oman, Gammon India Limited – AL Matar JV, refer note no. 37.
13. Counter claims in arbitration matters referred by the Company – liability unascertainable.
STATEMENT OF STANDALONE UNAUDITED RESULTS FOR THE QUARTER ENDED
30/06/2012
Rs. In Millions
|
S.No. |
Particulars |
3 Month ended 30/06/2012 (Unaudited) |
Preceding 3 Month ended 31/03/2012 (Unaudited) |
Previous Accounting Year ended 31.03.2012 (Audited) |
|
1 |
Income from
Operations |
|
|
|
|
|
Net Sales / Income from Operations |
12621.500 |
18587.200 |
55331.200 |
|
2 |
Expenses |
|
|
|
|
|
Cost of Material Consumed |
6859.500 |
7773.100 |
2,3955.200 |
|
|
Purchases of Stock-in-trade |
5,40.200 |
636.500 |
1662.500 |
|
|
Change in inventory of WIP and FG |
(964.900) |
275.600 |
(2954.100) |
|
|
Subcontracting Expenses |
2372.000 |
4192.000 |
13882.100 |
|
|
Employee Benefits Expenses |
1253.200 |
1352.200 |
5137.600 |
|
|
Depreciation and Amortisation |
263.700 |
263.800 |
1019.900 |
|
|
Other Expenses |
1866.900 |
2904.500 |
9158.500 |
|
|
Total Expenses |
1,2190.600 |
17397.700 |
51861.700 |
|
3 |
Profit/(Loss) from
Operations Before Other Income, Finance Costs |
430.900 |
1189.500 |
3469.500 |
|
4 |
Interest and Other Income |
328.200 |
507.000 |
1572.200 |
|
5 |
Profit/(Loss) from Ordinary
Activities Before Finance Costs and Forex Fluctuation |
759.100 |
1696.500 |
5041.700 |
|
6 |
Finance Cost |
950.500 |
1098.300 |
3634.200 |
|
7 |
Forex Fluctuation (Gain) / Loss |
(13.800) |
(295.600) |
(148.500) |
|
8 |
Exceptional / Prior Period Items |
|
(6.800) |
40.200 |
|
9 |
Profit Before Tax |
(177.600) |
900.600 |
1515.800 |
|
10 |
Tax Expenses |
18.500 |
371.100 |
645.400 |
|
11 |
Net Profit/(Loss) for the period |
(196.100) |
529.500 |
870.400 |
|
12 |
Paid-up Equity Share Capital (Face Value Rs.2/- per Equity Share) |
275.000 |
275.000 |
275.000 |
|
13 |
Reserves, excluding Revaluation Reserve as per Audited Balance Sheet |
|
|
19883.100 |
|
14 |
Earning Per Share
(Rupees) |
|
|
|
|
|
Basic |
(1.44) |
4.01 |
6.52 |
|
|
Diluted |
(1.44) |
3.98 |
6.48 |
|
|
|
|
|
|
|
A |
Particulars of
Shareholding |
|
|
|
|
1 |
Public Shareholding |
|
|
|
|
|
- Number of Shares |
8,87,68,314 |
8,91,43,314 |
8,91,43,314 |
|
|
- Percentage of Shareholding |
65.03% |
65.31% |
65.31% |
|
2 |
Promoters and
Promoter Group Shareholding |
|
|
|
|
|
Pledge/ Encumbered |
|
|
|
|
|
- Number of Shares |
1,15,75,000 |
1,15,75,000 |
1,15,75,000 |
|
|
- Percentage of Shareholding |
8.48% |
8.48% |
8.48% |
|
|
Non-encumbered |
|
|
|
|
|
- Number of Shares |
3,61,57,154 |
3,57,82,154 |
3,57,82,154 |
|
|
- Percentage of Shareholding |
26.49% |
26.21% |
26.21% |
|
|
|
|
|
|
|
B |
Investor Complaints |
|
|
|
|
|
Pending at the beginning of the quarter |
2 |
|
|
|
|
Received during the quarter |
12 |
|
|
|
|
Disposed of during the quarter |
14 |
|
|
|
|
Remaining unresolved at the end of the quarter |
0 |
|
|
Notes:
- The Financial Results were reviewed by the Audit Committee and taken on record by the Board of Directors of the Company at its meeting held on 14th August, 2012 and have been subjected to limited review by the Statutory Auditors of the Company as required by Clause 41 of the listing agreement.
- The above Financial results include share of Profit/(Loss) from the Company's Joint Venture in Oman. For the quarter, the profit/loss of the Joint Venture in Oman is as determined by the management which is relied upon by the auditors and has not been reviewed.
- During the quarter the Company has incorporated 'Patna Water Supply Distribution Network Private Limited' with 74% shareholding. In addition through its subsidiary Gammon Infrastructure projects Limited, the Company has incorporated as 100% subsidiary Birmitrapur Barkote Highway Private Limited, Sidhi Singrauli Road Projects Limited and Yamunanagar Punchkula Highway Private Limited.
- For the year ended March 2012 and for the quarter ended June 2012, The statutory auditors of the Company have qualified their report on account of certain contingent liabilities of a joint venture amounting to Rs. 82.600 Millions which in the opinion of the auditors of the Joint venture is more likely than not that Joint venture and consequently the company would be liable to incur the expenses. The management has filed an appeal in the higher courts and is confident that the contingent liability would not result in an obligation on the company since the Joint venture is very confident of the positive outcome of the same.
- The Company's operations constitute a single business and geographical segment of "Construction and Engineering" as per Accounting Standard AS-17.
- Corresponding figures of the previous period have been regrouped / rearranged wherever necessary.
FIXED ASSETS
- Leasehold Land
- Freehold Property
- Plant And Machinery
- Motor Vehicles
- Office Equipments
- Electrical Installation
- Windmills
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.55.54 |
|
|
1 |
Rs.87.39 |
|
Euro |
1 |
Rs.68.72 |
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 |
7 |
|
--LEVERAGE |
1~10 |
6 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
NO |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
NO |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
60 |
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.