MIRA INFORM REPORT

 

 

Report Date :

29.12.2012

 

IDENTIFICATION DETAILS

 

Name :

SRF LIMITED

 

 

Registered Office :

C-8, Commercial Complex, Safdarjung Development Area, New Delhi – 110 016

 

 

Country :

India

 

 

Financials (as on) :

31.03.2012

 

 

Date of Incorporation :

09.01.1970

 

 

Com. Reg. No.:

55-005197

 

 

Capital Investment/ Paid-up Capital:

Rs.584.356 millions

 

 

CIN No.:

[Company Identification No.]

L18101DL1970PLC005197

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

DELS33266C

 

 

PAN No.:

[Permanent Account No.]

AAACS0206P

 

 

Legal Form :

Public Limited Liability Company. The Company’s Shares are Listed on the Stock Exchanges.

 

 

Line of Business :

Subject is engaged in the manufacturing and distribution of a wide range of products in Technical Textiles, Chemicals and Packing Films Industries. 

 

 

No. of Employees:

2500 (Approximately)

 

 

RATING & COMMENTS

 

MIRA’s Rating :

A (69)

 

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 73868000

 

 

Status :

Good

 

 

Payment Behaviour :

Regular

 

 

Litigation :

Clear

 

 

Comments :

Subject is a well-established company having good track record. There appears slight dip in profitability.

 

However, general financial position of the company appears to be good. Performance capacity seems to be high. Creditworthiness of the company seems to be strong. Trade relations are reported to be fair. Business is active. Payments are reported to be regular and as per commitment.

 

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

 

NOTES :

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

 

ECGC Country Risk Classification List – 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

 

 

INDIAN ECONOMIC OVERVIEW

 

India is developing into an open-market economy, yet traces of its past autarkic policies remain. Economic liberalization, including industrial deregulation, privatization of state-owned enterprises, and reduced controls on foreign trade and investment, began in the early 1990s and has served to accelerate the country's growth, which has averaged more than 7% per year since 1997. India's diverse economy encompasses traditional village farming, modern agriculture, handicrafts, a wide range of modern industries, and a multitude of services. Slightly more than half of the work force is in agriculture, but services are the major source of economic growth, accounting for more than half of India's output, with only one-third of its labor force. India has capitalized on its large educated English-speaking population to become a major exporter of information technology services and software workers. In 2010, the Indian economy rebounded robustly from the global financial crisis - in large part because of strong domestic demand - and growth exceeded 8% year-on-year in real terms. However, India's economic growth in 2011 slowed because of persistently high inflation and interest rates and little progress on economic reforms. High international crude prices have exacerbated the government's fuel subsidy expenditures contributing to a higher fiscal deficit, and a worsening current account deficit. Little economic reform took place in 2011 largely due to corruption scandals that have slowed legislative work. India's medium-term growth outlook is positive due to a young population and corresponding low dependency ratio, healthy savings and investment rates, and increasing integration into the global economy. India has many long-term challenges that it has not yet fully addressed, including widespread poverty, inadequate physical and social infrastructure, limited non-agricultural employment opportunities, scarce access to quality basic and higher education, and accommodating rural-to-urban migration.

Source : CIA

 

EXTERNAL AGENCY RATING

 

Rating Agency Name

FITCH

Rating

AA (Long Term Rating)

Rating Explanation

Having very low default risk it indicates very strong capacity for payment of financial commitments.

Date

September 15, 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 :

C-8, Commercial Complex, Safdarjung Development Area, New Delhi – 110 016, India

Tel. No.:

91-11-26857141

Fax No.:

91-11-26510428

E-Mail :

srf.corp@srf.sprintrpg.ems.vsnl.net.in

ajoshi@srf.com

rlakhanpal@srf.com

Website :

http://www.srf.com

 

 

Corporate Office :

Block – C, Sector – 45, Gurgaon -122 003, Haryana, India

Tel. No.:

91-124-4354400

Fax No.:

91-124-4354500 

E-Mail :

ajoshi@srf.com

 

 

Chemicals and Polymers Business :

 

Factory 1 :

Village and P.O. Jhiwana, Tehsil Tijara, District Alwar - 301 018, Rajasthan, India

Tel. No.:

91-1493-220288/ 517838/ 517839

Fax No.:

91-1493-221125/ 517837

 

 

Factory 2 :

Manali Industrial Area, Manali, Chennai – 600 068, Tamilnadu, India

Tel. No.:

91-44-25941073

Fax No.:

91-44-25943073

 

 

Factory 3 :

Plot No.14 C, Sector 9, IIE Pantnagar, District Udham Singh Nagar – 263 153, Uttarakhand, India

 

 

Factory 4 :

D II/I, GIDC, PCPIR, GIDC, Phase II, Taluka Vagra, Village Dahej, District Bharuch – 392 130, Gujarat, India

 

 

Technical Textiles Business :

 

Factory 5 :

Manali Industrial Area, Manali, Chennai – 600 068, Tamilnadu, India

Tel. No.:

91-44-25946000

Fax No.:

91-44-25941159

 

 

Factory 6 :

Industrial Area, Malanpur, District Bhind - 477116, Madhya Pradesh, India

Tel. No.:

91-7539-283164

Fax No.:

91-7539-283427

 

 

Factory 7 :

Plot No.1, SIPCOT Industrial Area Complex, Gummidipoondi, District Thiruvallur - 601 201, Tamilnadu, India

Tel. No.:

91-44-27923212 – 22

Fax No.:

91-44-27922718 / 27922888

 

 

Factory 8 :

Viralimalai, District Pudukottai - 621 316, Tamilnadu, India

Tel. No.:

91-4339-220808

Fax No.:

91-4339-220284

 

 

Factory 9 :

Plot No.12, Rampura, Ramnagar Road, Kashipur, District Udham Singh Nagar – 244 713, Uttarakhand, India

Tel. No.:

91-5947-275604/ 05

Fax No.:

91-5947-275606

 

 

Packaging Films Business

 

Factory 10 :

Plot No.12, Rampura, Ramnagar Road, Kashipur, Distt. Udham Singh Nagar – 244 713, Uttarakhand, India

 

 

Factory 11 :

Plot No. C 1-8, C 21-30, Sector 3, Indore Special Economic Zone, Pithampur, District Dhar – 454 775, Indore, Madhya Pradesh, India

Tel. No.:

91-7292-400526

Fax No.:

91-7292-401745

 

 

DIRECTORS

 

As on 31.03.2012

 

Name :

Mr. Arun Bharat Ram

 

Designation :

Chairman

 

Date of Birth/Age :

71 Years

 

Qualification :

B.SC (Indl. Engineering)

 

Experience :

45 Years

 

Date of Appointment :

01.05.1972

 

 

 

 

Name :

Mr. Ashish Bharat Ram

 

Designation :

Managing Director

 

Date of Birth/Age :

43 Years

 

Qualification :

MBA

 

Experience :

21 Years

 

Date of Appointment :

02.09.2002

 

 

 

 

Name :

Mr. Kartikeya Bharat Ram

 

Designation :

Deputy Managing Director

 

Date of Birth/Age :

41 Years

 

Qualification :

MBA

 

Experience :

18 Years

 

Date of Appointment :

05.07.1993

 

 

 

 

Name :

Mr. S.P. Agarwala

 

Designation :

Director

 

 

 

 

Name :

Mr. K. Ravichandra

 

Designation :

Director (Safety and Environment)

 

 

 

 

Name :

Mr. Vellayan Subbiah

Designation :

Director

 

 

Name :

Mr. Satish K. Kaura

Designation :

Director

 

 

Name :

Mr. Vinayak Chatterjee

Designation :

Director

 

 

Name :

Mr. Subodh Bharagava

Designation :

Director

 

 

Name :

Mr. L. Lakshman

Designation :

Director

 

 

Name :

Mr. Tejpreet S. Chopra

Designation :

Director

 

 

Name :

Mr. Piyush G. Mankad

Designation :

Director

 

 

KEY EXECUTIVES

 

Name :

Mr. Anoop K. Joshi

Designation :

Company Secretary

Qualification :

FCA, FCS

 

 

Name :

Mr. Roop Salotra

Designation :

President and Chief Executive Officer (CB and PFB)

Date of Birth/Age :

61 Years

Qualification :

B.E.

Experience :

40 Years

Date of Appointment :

01.06.1989

 

 

Name :

Mr. Sushil Kapoor

Designation :

President and Chief Executive Officer (TTB)

Date of Birth/Age :

52 Years

Qualification :

B. Tech

Experience :

29 Years

Date of Appointment :

01.07.1982

 

 

Name :

Mr. Rajendra Prasad

Designation :

President and Chief Finance Officer

Date of Birth/Age :

54 Years

Qualification :

CA, DISA, CISA (USA)

Experience :

30 Years

Date of Appointment :

20.03.2006

 

 

Name :

Mr. Rajdeep Anand

Designation :

President (Projects and R&D)

Date of Birth/Age :

60 Years

Qualification :

B. Tech

Experience :

40 Years

Date of Appointment :

29.03.1993

 

 

Name :

Mr. Suresh Dutt Tripathi

Designation :

President (Corporate HR)

Date of Birth/Age :

51 Years

Qualification :

M. Sc, PGDSW

Experience :

29 Years

Date of Appointment :

11.02.2002

 

 

Name :

Mr. Suresh Kannan

Designation :

Vice President , Business Head (Belting and Coated Fabrics)

Date of Birth/Age :

44 Years

Qualification :

B. Tech

Experience :

23 Years

Date of Appointment :

05.06.1989

 

 

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

 

As on 30.09.2012

 

Category of Shareholders

No. of Shares

Percentage of Holding

(A) Shareholding of Promoter and Promoter Group

 

 

http://www.bseindia.com/include/images/clear.gif(1) Indian

 

 

http://www.bseindia.com/include/images/clear.gifBodies Corporate

29118634

50.71

http://www.bseindia.com/include/images/clear.gifSub Total

29118634

50.71

http://www.bseindia.com/include/images/clear.gif(2) Foreign

 

 

Total shareholding of Promoter and Promoter Group (A)

29118634

50.71

(B) Public Shareholding

 

 

http://www.bseindia.com/include/images/clear.gif(1) Institutions

 

 

http://www.bseindia.com/include/images/clear.gifMutual Funds / UTI

5016493

8.74

http://www.bseindia.com/include/images/clear.gifFinancial Institutions / Banks

595456

1.04

http://www.bseindia.com/include/images/clear.gifInsurance Companies

1734154

3.02

http://www.bseindia.com/include/images/clear.gifForeign Institutional Investors

4639421

8.08

http://www.bseindia.com/include/images/clear.gifSub Total

11985524

20.87

http://www.bseindia.com/include/images/clear.gif(2) Non-Institutions

 

 

http://www.bseindia.com/include/images/clear.gifBodies Corporate

2810017

4.89

http://www.bseindia.com/include/images/clear.gifIndividuals

 

 

http://www.bseindia.com/include/images/clear.gifIndividual shareholders holding nominal share capital up to Rs.0.100 million

11463290

19.96

http://www.bseindia.com/include/images/clear.gifIndividual shareholders holding nominal share capital in excess of Rs.0.100 million

1565874

2.73

http://www.bseindia.com/include/images/clear.gifAny Others (Specify)

477161

0.83

http://www.bseindia.com/include/images/clear.gifNon Resident Indians

434499

0.76

http://www.bseindia.com/include/images/clear.gifClearing Members

32339

0.06

http://www.bseindia.com/include/images/clear.gifTrusts

10273

0.02

http://www.bseindia.com/include/images/clear.gifOverseas Corporate Bodies

50

0.00

http://www.bseindia.com/include/images/clear.gifSub Total

16316342

28.42

Total Public shareholding (B)

28301866

49.29

Total (A)+(B)

57420500

100.00

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

0

0.00

http://www.bseindia.com/include/images/clear.gif(1) Promoter and Promoter Group

0

0.00

http://www.bseindia.com/include/images/clear.gif(2) Public

0

0.00

http://www.bseindia.com/include/images/clear.gifSub Total

0

0.00

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

57420500

0.00

 

 

BUSINESS DETAILS

 

Line of Business :

Subject is engaged in the manufacturing and distribution of a wide range of products in Technical Textiles, Chemicals and Packing Films Industries. 

 

 

Products :

Product Description

 

ITC Code

Tyre Cord Fabric

59.02

Polyster Films

39.20

Halogenated Derivatives of Hydrocarbons

29.03

 

PRODUCTION STATUS (AS ON 31.03.2012)

 

Particulars

 

Unit

Installed Capacity Per Annum

Synthetic Filament Yarn including Industrial Yarn / Tyre Cord / Twine

MT

68040

Nylon Tyre Cord Fabric / Industrial Yarn Fabric / Polyester Tyre Cord Fabric

MT

71384

Laminated Fabric

Lakhs SQM

480

Nylon / PBT / PC Compounding Chips

MT

14500

Fluorocarbon Refrigerant Gases

MT

25000

HFC 134a

MT

5000

Hydrofluoric Acid (Anhydrous)

MT

12000

Gypsum (By product)

MT

44550

Hydrochloric Acid (By Product)

MT

77220

Chloromethanes

MT

40000

Fluorospecialities Chemicals

MT

1800

Packaging Films

MT

59500

 

 

Particulars

 

Unit

Actual Production

Synthetic Filament Yarn including Industrial Yarn/Tyre Cord@/Twine@@

MT

11455.43

Nylon Tyre Cord Fabric/Industrial Yarn Fabric / Polyester Tyre Cord Fabric*

MT

50225.76

Laminated Fabric

Lakhs SQM

432.05

Nylon / PBT / PC Compounding Chips@@

MT

8634.60

Fluorocarbon Refrigerant Gases

MT

11311.67

HFC 134a

MT

3725.67

Hydrofluoric Acid (Anhydrous)@

MT

--

Gypsum (By Product)

MT

37514.30

Hydrochloric Acid (By Product)

MT

73023.20

Chloromethanes@

MT

21074.49

Fluorospecialities Chemicals

MT

1501.77

Packaging Films

MT

59816.66

 

Installed capacity is as certified by management

@ Excludes captive consumption

* Includes 1068.98 MT of nylon tyre cord fabric/industrial yarn fabric produced outside the Company by the

Company's conversion contractors

@@ Includes 106.55 MT of nylon compounding chips produced outside the Company by the Company's conversion contractors.

 

GENERAL INFORMATION

 

No. of Employees :

2500 (Approximately)

 

 

Bankers :

v  ICICI Bank Limited, New Delhi, India 

v  State Bank of India, New Delhi, India

v  State Bank of Patiala, New Delhi, India

v  The Hongkong and Shanghai Banking Corporation Limited, New Delhi, India

v  Citibank N.A., New Delhi, India

v  Punjab National Bank, New Delhi, India

v  Standard Chartered Bank

v  Yes Bank Limited

v  HDFC Bank Limited 

v  ABN Amro Bank N.V.

v  The Royal Bank of Scotland

 

 

Facilities :

Secured Loans

31.03.2012

(Rs. in Millions)

31.03.2011

(Rs. in Millions)

Long term borrowings

 

 

Nil (Previous Year – 1500), 13%, Listed, Secured Redeemable Non-Convertible Debentures of Rs.1.000 million each

0.000

1500.000

Term loans from banks

5497.954

5313.737

Less : Current maturities of long term borrowings

Term Loans from Banks

 

 

(1204.886)

 

 

(2466.533)

Short term borrowings

 

 

Cash credits from banks

90.358

35.124

Term loans from banks

946.405

222.950

Total

5329.831

4605.278

 

Unsecured Loans

31.03.2012

(Rs. in Millions)

31.03.2011

(Rs. in Millions)

Long term borrowings

 

 

1500 (Previous Year – Nil), 10.60%, Listed, Unsecured Redeemable Non-Convertible Debentures of Rs.1.000 million each

1500.000

0.000

Short term borrowings

 

 

Term loans from banks

1907.534

1049.858

Others*

0.000

0.000

Total

3407.534

1049.858

 

* Includes Nil (Previous Year - Nil) for Commercial Paper issued by the Company. The maximum amount due during the year is Nil (Previous Year – Rs.250.000 millions)

 

 

 

Banking Relations :

--

 

 

Auditors :

 

Name :

Deloitte Haskins and Sells

Chartered Accountants

Address :

Gurgaon, Haryana, India

 

 

Subsidiaries:

v  SRF Overseas Limited

v  SRF Transnational Holdings Limited

v  SRF Properties Limited

v  SRF Holiday Home Limited

v  SRF Energy Limited

v  SRF Fluorochemicals Limited

v  SRF Fluor Private Limited

v  SRF Global BV

v  SRF Tech Textile BV (upto August 31, 2011)

v  SRF Industries (Thailand) Limited (formerly SRF Technical Textiles (Thailand) Limited)

v  SRF Industex Belting (Pty) Limited

v  SRF Nitol Bangladesh Limited

v  SRF Flexipak (South Africa) (Pty) Limited

 

 

Joint Venture :

Jingde Yangtze-Ganga Fluorine Chemical Co. Limited (upto February 26, 2011)

 

 

Enterprises over which Key Management Personnel and their relatives have significant influence

v  KAMA Holdings Limited*

v  Bhairav Farms Private Limited*

v  Narmada Farms Private Limited*

v  SRF Polymers Investments Limited*

v  KAMA Realty (Delhi) Limited*

v  Shri Educare Limited

v  Shri Educare Maldives Private Limited

v  SRF Foundation

v  Karm Farms Private Limited*

v  Srishti Westend Greens Farms Private Limited*

 

* Pursuant to the Scheme of Arrangement between Narmada Farms Private Limited, Bhairav Farms Private Limited and SRF Polymers Investments Limited (“the transferor companies”) and Srishti Westend Greens Farms Private Limited, Karm Farms Private Limited, KAMA Realty (Delhi) Limited and KAMA Holdings Limited (“the transferee companies”) and their respective shareholders and creditors :-

a) real estate divisions of Narmada Farms Private Limited, Bhairav Farms Private Limited and SRF Polymers Investments Limited was transferred and vested in Srishti Westend Greens Farms Private Limited, Karm Farms Private Limited and KAMA Realty (Delhi) Limited respectively; and

b) investment divisions of Narmada Farms Private Limited, Bhairav Farms Private Limited and SRF Polymers Investments Limited were transferred and vested in KAMA Holdings Limited with effect from March 31, 2011.

 

The transferor companies had conducted their business in respect of their respective real estate divisions and investment divisions

in trust and on behalf of the respective transferee companies from the appointed date of the said Scheme - April 1, 2010

 

CAPITAL STRUCTURE

 

As on 31.03.2012

 

Authorised Capital :

No. of Shares

Type

Value

Amount

120000000

Equity Shares

Rs.10/- each

Rs.1200.000

millions

1000000

Preference Shares

Rs.100/- each

Rs.100.000

millions

1200000

Cumulative Convertible Preference Shares

Rs.50/- each

Rs.60.000 millions

20000000

Cumulative Preference Shares

Rs.100/- each

Rs.2000.000

Millions

 

Total

 

Rs.3360.000

millions

 

Issued Capital :

No. of Shares

Type

Value

Amount

61477255

Equity Shares

Rs.10/- each

Rs.614.773

millions

 

 

Subscribed & Paid-up Capital :

No. of Shares

Type

Value

Amount

57420500

Equity Shares

Rs.10/- each

Rs.574.205 millions

 

Add: Forfeited shares - Amount originally paid up

 

Rs.10.151 millions

 
Add: Share capital suspense*

 

--

 

Total

 

Rs.584.356 millions

 

* Share capital suspense represents Nil equity shares which were awaiting allotment to the erstwhile shareholders of Flowmore Polysters Limited (FPL) pending settlement of calls in arrears in respect of their shareholding in FPL, have been transferred to capital reserve during the year.

 

Reconciliation of equity shares

 

Particulars

Number of shares

Value

(Rs. in millions)

As at April 1, 2010

60503580

605.036

Add: Movement during the year

--

--

As at March 31, 2011

60503580

605.036

Less: Shares bought back during the year

3083080

30.831

As at March 31, 2012

57420500

574.205

 

Shareholders holding more than 5% shares in the Company

 

Name of the shareholder

As at March 31, 2012

(No. of shares)

% of total

KAMA Holdings Limited

28606962

49.82

 

The Company has bought back 10464505 equity shares in aggregate in the last five financial years.

 

Terms/ rights attached to equity shares

 

The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. The Board may from time to time pay to the members such interim dividends as appear to it to be justified by the profits of the Company.

 

During the year ended March 31, 2012, the amount of interim dividend recognized as distributions to equity shareholders was Rs.14 per share.

 

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

 

 

 

 

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

584.356

615.241

615.241

2] Share Application Money

0.000

0.000

0.000

3] Reserves & Surplus

17882.650

15784.812

12064.833

4] (Accumulated Losses)

0.000

0.000

0.000

NETWORTH

18467.006

16400.053

12680.074

LOAN FUNDS

 

 

 

1] Secured Loans

5329.831

4605.278

7501.936

2] Unsecured Loans

3407.534

1049.858

1891.438

TOTAL BORROWING

8737.365

5655.136

9393.374

DEFERRED TAX LIABILITIES

2170.930

2094.224

2059.114

 

 

 

 

TOTAL

29375.301

24149.413

24132.562

 

 

 

 

APPLICATION OF FUNDS

 

 

 

 

 

 

 

FIXED ASSETS [Net Block]

18607.816

18063.709

17717.393

Capital work-in-progress

4142.646

1130.706

1270.743

 

 

 

 

INVESTMENT

2186.999

2018.987

1646.167

DEFERRED TAX ASSETS

0.000

0.000

0.000

 

 

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

 

 

 

Inventories
4121.961
4387.299
2490.310

 

Sundry Debtors
4080.289
4417.849
3402.293

 

Cash & Bank Balances
1292.067
638.553
653.497

 

Other Current Assets
37.870
35.188
0.000

 

Loans & Advances
1773.439
1710.994
1672.976

Total Current Assets
11305.626
11189.883
8219.076

Less : CURRENT LIABILITIES & PROVISIONS
 
 

 

 

Sundry Creditors
4448.887
4840.403
2062.656

 

Other Current Liabilities
2180.807
3219.327
2411.275

 

Provisions
238.092
194.142
246.886

Total Current Liabilities
6867.786
8253.872
4720.817

Net Current Assets
4437.840
2936.011
3498.259

 

 

 

 

MISCELLANEOUS EXPENSES

0.000

0.000

0.000

 

 

 

 

TOTAL

29375.301

24149.413

24132.562

 

 

 

 

PROFIT & LOSS ACCOUNT

 

 

PARTICULARS

31.03.2012

31.03.2011

31.03.2010

 

SALES

 

 

 

 

 

Sale of products (net)

35127.275

29860.627

21810.776

 

 

Other Income

455.489

1205.877

681.592

 

 

TOTAL                                     (A)

35582.764

31066.504

22492.368

 

 

 

 

 

Less

EXPENSES

 

 

 

 

 

Cost of materials consumed

20211.628

16359.043

11271.065

 

 

Purchases of traded goods

64.016

146.391

364.166

 

 

(Increase)\Decrease in inventories of finished goods, stock-in-process and traded goods

(65.239)

(448.040)

(261.732)

 

 

Employee benefits expenses

1640.487

1506.242

1854.134

 

 

Other expenses

5415.499

4434.080

2723.843

 

 

TOTAL                                     (B)

27266.391

21997.716

15951.476

 

 

 

 

 

Less

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

8316.373

9068.788

6540.892

 

 

 

 

 

Less

FINANCIAL EXPENSES                                     (D)

1040.932

776.921

680.479

 

 

 

 

 

 

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

7275.441

8291.867

5860.413

 

 

 

 

 

Less/ Add

DEPRECIATION/ AMORTISATION                      (F)

1616.807

1517.081

1321.320

 

 

 

 

 

 

PROFIT BEFORE TAX (E-F)                              (G)

5658.634

6774.786

4539.093

 

 

 

 

 

Less

TAX                                                                 (H)

1784.834

1940.365

1444.891

 

 

 

 

 

 

PROFIT AFTER TAX (G-H)                                (I)

3873.800

4834.421

3094.202

 

 

 

 

 

Add

PREVIOUS YEARS’ BALANCE BROUGHT FORWARD

9315.563

6271.376

4820.680

 

 

 

 

 

Less

APPROPRIATIONS

 

 

 

 

 

Interim Dividend

812.300

847.050

847.050

 

 

Corporate Dividend Tax

131.800

140.684

143.956

 

 

Transfer to General Reserve

400.000

500.000

350.000

 

 

Debenture redemption reserve

750.000

302.500

302.500

 

 

Allowance Reserve

55.000

0.000

0.000

 

BALANCE CARRIED TO THE B/S

11040.263

9315.563

6271.376

 

 

 

 

 

 

EARNINGS IN FOREIGN CURRENCY

 

 

 

 

 

Export of goods calculated on FOB value

12203.695

7928.559

5622.444

 

 

Interest

1.264

0.092

14.914

 

 

Profit on sale of investment in subsidiary/others

4.284

28.515

0.000

 

 

Service fee including recovery of actual expenses incurred

32.611

28.180

0.000

 

TOTAL EARNINGS

12241.854

7985.346

5637.358

 

 

 

 

 

 

IMPORTS

 

 

 

 

 

Raw Materials

6431.004

6691.076

3688.991

 

 

Stores & Spares

214.827

164.048

79.933

 

 

Capital Goods

403.584

504.396

2088.572

 

TOTAL IMPORTS

7049.415

7359.520

5857.496

 

 

 

 

 

 

Earnings Per Share (Rs.)

65.55

79.90

51.14

 

 

QUARTERLY RESULTS

 

PARTICULARS

 

 

30.06.2012

(1st Quarter)

30.09.2012

(2nd Quarter)

Net Sales

 

8122.200

8037.400

Total Expenditure

 

7233.500

6923.900

PBIDT (Excl OI)

 

888.700

1113.500

Other Income

 

73.200

455.200

Operating Profit

 

961.900

1568.700

Interest

 

239.100

247.100

Exceptional Items

 

0.000

0.000

PBDT

 

722.800

1321.600

Depreciation

 

422.000

462.900

Profit Before Tax

 

300.800

858.700

Tax

 

80.600

105.100

Provisions and contingencies

 

0.000

0.000

Profit After Tax

 

220.200

753.600

Extraordinary Items

 

0.000

0.000

Prior Period Expenses

 

0.000

0.000

Other Adjustments

 

0.000

0.000

Net Profit

 

220.200

753.600

 

 

KEY RATIOS

 

PARTICULARS

 

 

31.03.2012

31.03.2011

31.03.2010

PAT / Total Income

(%)
10.89

15.56

13.76

 

 
 

 

 

Net Profit Margin

(PBT/Sales)

(%)
16.11

22.69

20.81

 

 
 

 

 

Return on Total Assets

(PBT/Total Assets}

(%)
18.92

23.16

17.50

 

 
 

 

 

Return on Investment (ROI)

(PBT/Networth)

 
0.31

0.41

0.36

 

 
 

 

 

Debt Equity Ratio

(Total Liability/Networth)

 
0.85

0.85

1.11

 

 
 

 

 

Current Ratio

(Current Asset/Current Liability)

 
1.65

1.36

1.74

 

 

LOCAL AGENCY FURTHER INFORMATION

 

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

Yes

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

 

 

 

OPERATIONS REVIEW

 

Net sales of the Company grew by 17.64 per cent from Rs.29860.600 millions in 2010-11 to Rs.35127.300 millions in 2011-12. Due to combined factors of higher input costs, higher energy costs and adverse demand-supply situation Profit before interest, depreciation and tax (PBIDT) including ‘other income’ decreased from Rs.9059.800 millions in 2010-11 to Rs.8296.200 millions in 2011-12.

 

Profit before tax (PBT) decreased by 16.48 per cent from Rs.6774.800 millions in 2010-11 to Rs.5658.600 millions in 2011-12. After accounting for the provision for taxation of Rs.1784.800 millions, which includes deferred tax charge and provision relating to earlier years, profit after tax (PAT) fell by 19.87 per cent from Rs.4834.400 millions in 2010-11 to Rs.3873.800 millions in 2011-12.

 

SUBSIDIARY COMPANIES

 

Restructuring of shareholding in international subsidiaries

 

SRF Global B.V.

 

In order to streamline the overseas holding structure and reduce administrative expenses, SRF Tech textile B.V., was merged into SRF Global B.V. SRF Global B.V. has reported a loss of US $ 8.24 lakhs during the year 2011-12 on account of administrative and interest expenses.

 

SRF Industries (Thailand) Limited

 

A wholly owned subsidiary of SRF Global B.V. is a company incorporated in Thailand and engaged in the manufacture and distribution of nylon tyre cord. The company is setting up a Greenfield project in Thailand to manufacture Biaxially Oriented Polyethylene Terephthalate film with a capacity of 28500 TPA. The project is expected to commence commercial production during 2013-14. For the year 2011-12, the turnover of the company was THB 2093.32 million and the company incurred a loss of THB 25.09 million.

 

SRF Industex Belting (Pty) Limited

 

A wholly owned subsidiary of SRF Global B.V. is a company incorporated in South Africa and engaged in the manufacture of belting fabrics. For the year 2011-12, the turnover of the company was ZAR 144.14 million and the company incurred a loss of ZAR 4.27 million.

 

SRF Overseas Limited

 

A wholly owned subsidiary of SRF Global B.V., is operating out of Dubai and is an arm of the Technical Textiles Business (TTB) targeted at the markets of Middle East, Europe and Africa. During the year 2011-12, turnover of the Company was AED 147.48 million and the company incurred a loss of AED 3.89 million.

 

SRF Flexipak (South Africa) (Pty) Limited

 

A wholly owned subsidiary of SRF Global B.V., has been incorporated during the year to set up a greenfield project to manufacture Biaxially Oriented Polypropylene film in South Africa with a capacity of 25500 TPA. The project is expected to commence commercial production during 2013-14. For the year 2011-12, the company had earned an income of ZAR 1.39 million mainly on account of foreign exchange profit of ZAR 1.24 million on the loans availed from the holding company for purchase of land and for other miscellaneous expenditure. The company earned a profit of ZAR 1 million.

 

Other Subsidiaries

 

SRF Transnational Holdings Limited earned a net profit (PAT) of Rs.8.937 millions during the year 2011-12.

 

SRF Properties Limited earned a net profit (PAT) of Rs.1.610 millions during the year 2011-12.

 

SRF Holiday Home Limited has incurred a loss of Rs.0.015 million during the year 2011-12.

 

SRF Fluorochemicals Limited, SRF Energy Limited, SRF Fluor Private Limited, and SRF Nitol (Bangladesh) Limited had not started any operations.

 

MANAGEMENT DISCUSSION AND ANALYSIS

 

The year 2011-12 was a year of two halves. While the first half was relatively stable, the second half was impacted by the woes of an unstable global economy. They had to deal with rising input costs, falling demand, foreign currency volatility, soaring inflation and high interest rates. The Indian economy after recording a GDP growth of 8.4 per cent during the previous year saw a decline to a level of 6.9 per cent during 2011-12. SRF, on its part, kept working at improving its internal efficiencies and charting its own growth path amidst the global turmoil.

 

Highlights of SRF’s financial performance

 

• net sales from operations up by 17.64 per cent from Rs.29860.600 millions in 2010-11 to Rs.35127.300 millions in 2011-12

• profit before depreciation, interest (net) and tax down by 9.20 per cent from Rs.9059.800 millions in 2010-11 to Rs.8296.200 millions in 2011-12

• profit before tax (PBT) down by 16.48 per cent from Rs.6774.800 millions in 2010-11 to Rs.5658.600 millions in 2011-12

• profit after tax (PAT) down by 19.87 per cent from 4834.400 millions in 2010-11 to Rs 3878.800 millions in 2011-12

• earnings per share down by 17.96 per cent from Rs.79.90 in 2010-11 to Rs 65.55 in 2011-12

 

Businesses

 

SRF has a portfolio of established businesses in industrial intermediates. It classifies its main businesses as: Technical Textiles Business (TTB), Chemicals and Polymers Business (CPB) and Packaging Films Business (PFB).

 

Technical Textiles Business

 

Reflecting 15.21 per cent year on year growth, from Rs.14452.900 millions in 2010 - 11 to Rs.16651.900 millions in 2011–12 Technical Textiles Business (TTB) continues to be SRF’s largest business segment, contributing over 47 per cent to the total sales of the Company.

 

Tyre Cord Reinforcement

 

The Nylon Tyre Cord Fabrics (NTCF) business segment has been a foundation business for SRF for several decades. In the year gone by whilst the first half of the year saw robust demand in the transportation sector reflecting the healthy growth of the Indian economy, the second half was relatively subdued. Apart from the sluggishness of the economy affecting the transportation sector in the second half of the year, the demand was also affected by the Supreme Court judgment in relation to the Mining Industry, which saw considerable population of the trucks becoming idle for a significant period. The business was also adversely affected on account of significantly higher commodity prices, particularly for chemicals and energy costs, which it was not in a position to pass on fully to its customers.

 

SRF invested in Polyester Tyre Cord Fabrics (PTCF) a few years back. This segment which caters to the radial tyre segment of passenger cars and light commercial vehicles, is beginning to find its feet both in the domestic and overseas markets.

 

It is believed that in times to come the foundation being built now could be used as a launching pad.

 

In addition, the company has initiated development of new products in the Polyester Industrial Yarn space, which would enable it to improve its profitability and widen its portfolio.

 

Belting Fabric

 

SRF has been a dominant player with over 60 per cent of the market share in the Belting Fabric segment in India and has a significant global presence, being the second largest manufacturer in the world. This business segment was also adversely affected in the second half of the year on account of the fall in mining activity in the country and freezing of key infrastructure and power projects.

 

In the overseas markets, the volumes were adversely affected in the last quarter with the slowing down of the world economy.

 

The company’s South African subsidiary, which posted excellent results in the previous year, had a difficult time during the year due to negative demand in the mining sector. This was largely because the customer industry had put their investments on hold for fear of nationalisation of mines in South Africa.

 

To offset the fall in demand in the domestic South African market, the company has made inroads into Latin America, a step which would help it to offset the risk in the longer term.

 

Coated and Laminated Fabrics

 

The Laminated Fabrics Business has started generating positive cash flows having commenced production in Q4’2009-10 and has established itself well in the signage market. Towards the end of the financial year, it had reached full capacity utilization and is now considering the expansion of the plant to build a strong position in the coming year.

 

The new state-of-the-art Coated Fabric line at Gummidipoondi with a capacity of 170 lakh square meter per annum has commenced production. The products have been well accepted by the market. This facility offers a wide range of products including lacquered tarpaulins, fabrics for tensile structures, awnings, auto-canopies, hangar covers etc. In addition, Poly Urethane (PU) Coated Fabrics have also been introduced for several applications. SRF which offers the widest range of products in this segment is poised to capture a major market share in India and the coming year would see increased efforts to build this segment significantly.

 

Industrial Yarn Business (IYB)

 

With the commissioning of the Polyester Industrial Yarn project a few years ago, SRF is able to offer a basket of Industrial yarns (nylon and polyester) for conveyor belts, transmission belts, hoses, ropes, geo-textile applications, fishing nets, stitching threads etc. SRF continues to enjoy a significant market share in the critical segments of the industry.

 

Outlook

 

The NTCF segment of Technical Textiles Business, the largest business of SRF, mainly caters to bias tyres for bus and truck segment. The current radialisation in this segment is 18 per cent only. It is estimated that radialisation would touch a level of around 30 per cent by 2013-14 and 50 per cent by 2017-18. It is projected to stabilise thereafter, as has been observed in other developing economies of the world.

 

With infrastructure and mining sectors expected to grow substantially in the coming years, tyres for ‘Off the Road’ (OTR) vehicles, which are already witnessing a high growth, are expected to grow in double digits on a sustainable basis for many years. These tyres consume large amount of NTCF per tyre, thus ensuring a reasonable growth rate.

 

It is, therefore, expected that in absolute quantity terms, the demand for NTCF would grow marginally over the next five years, though the application portfolio would show a shift from buses and trucks to two- wheelers, OTR tyres and tractor tyres.

 

The passenger car (PC) tyre radialisation in India has reached a mature level now (over 90 per cent), which predominantly uses Polyester Tyre Cord Fabric (PTCF) as carcass for reinforcement. The car industry is expected to grow substantially in the coming years and, therefore, offers an opportunity to SRF to provide PTCF fabrics for radial tyres.

 

Currently, SRF is the only company in India to produce PTCF and is well positioned to benefit from the opportunity. Leveraging its relationship with the global majors on account of its Nylon business, SRF has made progress in commercialising its products.

 

In Belting Fabrics, given the expectation of growth in the domestic mining industry and infrastructure, the outlook is positive in India. This augurs well for SRF, which has over 60 per cent share of this business in the domestic market. In addition, with the demand for commodities continuing to grow at a high rate globally, mining is expected to be on a growth path and this would offer opportunities to SRF.

 

Coated Fabrics and Laminated Fabrics through the investments made and being planned are expected to grow substantially over the next few years to become the second largest segment in SRF’s Technical Textiles Business. With changing lifestyles, urbanisation, and massive investments in infrastructure, it is expected that products such as signages, awnings and hangar covers would see a double digit growth. With the increasing usage of tensile structures with fabrics, as evidenced in stadiums, homes and exhibition centres, the high end products are expected to grow in double digits too.

 

SRF is one of the first large sector companies to foray into this area in a significant way and it is expected that the Company would be able to establish a leadership position in a short time. With state-of-the-art facility, it would also have the option of considering exports, in addition to servicing the domestic markets.

 

Chemicals and Polymers Business

 

The manufacturing operations of SRF’s Chemicals Business are located at Bhiwadi, in Rajasthan, about 70 kilometres from New Delhi. The business derives its revenue from the sale of fluorine-based refrigerants, chloromethanes, fast-growing specialty fluorochemicals and engineering plastics. It also includes receipts from the sale of CERs generated by destruction of the greenhouse gas Hydro uorocarbon-23 (HFC-23) under the Kyoto Protocol.

 

During the first half of 2011-12, the Chemicals Business posted record performance with YoY sales growing by 94 per cent and EBIDT by 147 percent. However, during the second half, performance was relatively muted, closing the year with an overall YoY sales growth of 70 per cent and EBIDT of 107 per cent. The business faced challenges from a slowdown in the pharmaceutical sector and startup of additional capacities in chloromethanes, which affected margins.

 

The Fluorospecialities Business continued to grow in line with strong market demand with sales growth of 48 per cent and EBIDT growth of 66 per cent in FY 2011-12. During the year, the business continue to extend its strategic tie-ups with global agro and pharma majors whilst meeting their product specification through technological innovation in the existing product portfolio.

 

Refrigerants

 

Refrigerants are primarily used as a cooling medium in the air-conditioning and refrigeration industry. SRF continues to be one of the larger and more credible players in the industry globally. It is the domestic market leader with about 40 per cent share. Exports of the business are spread across 60 countries worldwide, and account for over 60 per cent of the volumes produced.

 

SRF’s portfolio of refrigerants includes hydrochlorofluorocarbon-22 (HCFC-22), the new-generation refrigerant hydrofluorocarbon-134a (HFC-134a), and the refrigerant blend R404a.The company is proactively addressing the expected phase-out of HCFCs from 2013 onwards under the Montreal Protocol by investing in an HFC-134a/125 plant in Dahej, Gujarat.

 

The market for refrigerants is estimated to grow at about 10-15 per cent per annum. The outlook for refrigerant market augurs well for SRF which continues to be the market leader in a fast-growing, challenging and competitive landscape populated by global majors.

 

Chloromethanes

 

SRF's main products in the chloromethanes business are methylene chloride and chloroform. While chloroform is internally consumed for manufacturing HCFC-22, methylene chloride is sold primarily in the domestic market.

 

In 2011-12, the chloromethanes segment made a significant contribution to the business’ profitability, despite substantial fresh domestic production capacity. While the additional capacity is expected to substitute imports in the medium to longterm, it has resulted in dropping profitability during the second half of 2011-12, and cast a shadow over 2012-13 as well. A soft pharmaceutical industry (end-user for methylene chloride) was not in a position to pick up the additional quantities, putting pressure on margins. Despite these competitive pressures, the chloromethanes business has successfully remained profitable, and hopes to remain so through 2012-13 as well. Strong relationships with customers, high product quality, efficient production, and short delivery lead times continue to be key differentiators vis-à-vis imports.

 

Fluorospecialities

 

Building on its presence in the fluorine chemistry industry for almost two decades, the Company had entered the space of specialty fluorine chemistry in 2003-04. The focus has been to leverage the Company’s expertise to produce intermediates and advanced intermediates, which are used to manufacture Active Pharmaceutical Ingredients (APIs) and agrochemicals by its customers. Fluorine-based specialty chemicals are finding increasing usage in the fields of agrochemicals, pharmaceuticals and performance products.

 

To take on the process development for new molecules at the scale necessary to support the business’ growth plans, the strength of R&D and process engineering have been significantly augmented, in terms of people, infrastructure and management. Today, a number of projects are in various stages of construction. The business is closely engaged with buyers for most of these products.

 

Engineering Plastics

 

Engineering Plastics, a group of polymers comprising polyamides (N6 and N66), poly butylenethalate (PBT) and poly carbonates (PC) continues to build its volume and share. Except for the four-wheel segment all other segments showed robust growth. The margins, however, remained under pressure due to a competitive market situation and exchange rate impact.

 

SRF had started a dedicated product development centre last year which helped it complete some key product development projects and complete its product range. The business continued to enhance its skills in R&D and new product development, thereby reducing the cost of processing and developing high end grades. The Company’s development Centre also received recognition by the Department of Scientific and Industrial Research (DSIR) during the year.

 

Outlook

 

The Chemicals Business has been on the growth path over the past few years mainly driven by strong commodity upswing and R&D led innovations in speciality products. The commodity business mainly consisting of refrigerants has sustained its domestic market leadership while fluorospeciality business expanded its overseas presence by adding more volumes to existing customer base. Going forward the focus on new generation refrigerants along with a bouquet of specialty products driven by leading edge in-house R&D technology will continue.

 

During 2012-13, the business is expected to derive value from new products manufactured at its Dahej facility. In addition, the investment in a new R-134a/125 plant in Dahej will come up at the end of 2013-14.

 

The upcoming plant will be backward integrated with a global size HF plant to meet the production need.

 

In Fluorospecialities, the business is expected to improve its profitability from commercialisation of a range of speciality products coming out of Dahej. There is a sizable market available for these products and the business is continuing to build on its reputation and credibility with the global agrochemical and pharmaceutical majors. These niche product offerings are expected to establish the Fluorospeciality business as a key value driver for the future growth of the Chemicals Business.

 

Packaging Films Business

 

In financial year 2011-12, the market demand-supply was far worse than what the industry had forecast in the beginning of the year. The shrinking of domestic market by around 30 per cent due to a ban on plastic laminates in Gutka packaging, coupled with start-up of many new capacities, both in India and abroad, resulted in an oversupply situation. This led to crashing of prices resulting in significant erosion in margins and business profitability. Overall, the business EBIT fell from Rs.3476.000 millions in 2010-11 to Rs.160.000 millions.

 

To hedge against this volatility they increased their exports sales by around 18 per cent and ventured into value-added product variants. They also won the prestigious EPCES Export Award for Best non SSI SEZ unit for Plastic Products for the 5th consecutive year. Operationally, all the plants operated well, with the Indore plant setting global benchmarks both in production and line speed whilst Kashipur enhanced its capability as a swing plant. On the growth front, work on the two international projects at Thailand and South Africa started. Both the units are scheduled to be commissioned during 2013-14.

 

Outlook

 

They expect the global demand for polyester films to continue growing at around 6 per cent. However, this will not be sufficient to make up for the disproportionate capacity additions in China and India which have created an oversupply situation. They expect this situation to continue in 2012-13 leading to continued pressure on margins. Low margins would discourage new investments, which should balance the demand supply situation from 2013–2014.

 

They believe that in the coming year, companies with low cost and global reach will have advantage over the competition. Thus, SRF’s strategy for the year will be to focus on increasing exports, enhance product offerings to include value added products and to work towards timely and cost effective global expansions. Although they witness cyclicality in this business, they believe that the long term prospects are encouraging.

 

CONTINGENT LIABILITIES NOT PROVIDED FOR

 

a) Claims against the Company not acknowledged as debts:

 

Particulars

31.03.2012

(Rs. in millions)

31.03.2011

(Rs. in millions)

Excise duty, customs duty and service tax* @

592.408

586.544

Sales tax** @

122.528

92.542

Income tax

35.682

97.637

Stamp duty****

288.155

288.155

Others ***

47.433

9.443

 

* Amount deposited Rs.31.592 millions (Previous year – Rs.31.592 millions)

** Amount deposited Rs.0.716 million (Previous Year – Rs.0.716 millions)

*** Amount deposited Rs.0.800 million (Previous Year – Rs.0.800 million)

**** In the matter of acquisition of the Tyrecord Division at Malanpur from Ceat Limited the Collector of Stamps, Bhind (Madhya Pradesh) has by his order dated 07.11.2001 assessed the value of the subject matter of the Deed of Conveyance dated 13.06.1996 at Rs.3030.000 millions and levied a stamp duty of Rs.237.250 millions and imposed a penalty of Rs.50.905 millions. The said demand was challenged before the High Court of Madhya Pradesh Bench at Gwalior. The High Court accepted the case of the Company that the subject matter of the Deed of Conveyance dated 13.06.1996 is only the superstructures valued at Rs 277.618 millions and not the entire undertaking valued at Rs.3030.000 millions as claimed by the State. Consequently, the High Court of Madhya Pradesh quashed the order and demands issued by the Collector of Stamps, Bhind (Madhya Pradesh) and allowed the writ petition by an order dated 29th November 2004. Against the said order, the State of Madhya Pradesh preferred a Special Leave Petition before the Hon'ble Supreme Court which the State of Madhya Pradesh has withdrawn to enable it to approach the Hon'ble High Court of Madhya Pradesh at Gwalior in view of the change in law in the State of Madhya Pradesh relating to Letters Patent Appeal.

@ As per Business Transfer Agreement with KAMA Holdings Limited, the liabilities of Rs.179.381 millions (Previous Year – Rs.179.381 millions) and Rs.3.800 millions (Previous Year – Rs.3.800 millions) respectively towards Excise Duty and Sales tax are covered under Representations and Warranties.

 

All the above matters are subject to legal proceedings in the ordinary course of business. In the opinion of the management, the legal proceedings, when ultimately concluded, will not have a material effect on the results of the operations or financial position of the Company.

 

b) Liability on account of Bank Guarantees Rs.126.026 millions (Previous Year – Rs.113.753 millions)

 

c) Guarantees given to banks for repayment of financial facilities availed by wholly owned subsidiaries:

(i) USD 20.00 million (Previous Year – USD 20.00 million). Outstanding amount as at the year-end is USD 20.00 million (Previous Year – USD 20.00 million)

(ii) Nil (Previous Year – AED 10.35 million) and Nil (Previous Year – Euro 0.20 million). Outstanding amount as at the year-end is Nil (Previous Year – Nil)

(iii) USD 15.00 million (Previous Year – Nil). Outstanding amount as at the year-end is USD 13.00 million (Previous Year – Nil).

(iv) USD 16.00 million (Previous Year – Nil). Outstanding amount as at year end is EURO 11.25 million (Previous Year – Nil).

(v) EURO 3.50 million (Previous Year – Nil). Outstanding amount as at year end is EURO 3.50 million (Previous Year – Nil)

 

d) Guarantees given to banks for repayment of financial facilities availed by others – Rs.25.000 millions (Previous Year – Nil). Outstanding amount as at the year-end is Nil (Previous Year – Nil).

 

e) The Company has been served with show cause notices regarding certain transactions as to why additional customs / excise duty amounting to Rs.7.224 millions (Previous year – Rs.7.604 millions) should not be levied. The Company has been advised that the contention of the department is not tenable and hence the show cause notice may not be sustainable.

 

UNAUDITED FINANCIAL RESULTS FOR THE QUARTER / HALF YEAR ENDED 30TH SEPTEMBER 2012

(Rs. in millions)

Sl. No.

 

Particulars

3 Months Ended 30th September 2012

3 Months Ended 30th June 2012

Half Year Ended 30th September 2012

Unaudited

Unaudited

Unaudited

 

PART I

 

 

 

1

Income from operations

a)         Net sales/ Income from Operations (net of excise duty)

8011.900

8095.200

 

16107.100

 

 

b)         Other Operating Income

25.500

27.000

52.500

 

Total Income from operations (net)

8037.400

8122.200

16159.600

2

Expenditure

 

 

 

 

a.         Cost of materials consumed

4936.700

4997.800

9934.500

 

b.         Purchase of stock-in-trade

1.000

17.100

18.100

 

c.         Changes in inventories of finished goods, work-in-progress and
stock in trade

(27.100)

(96.200)

(123.300)

 

d.         Employee benefits expense

524.600

441.900

966.500

 

e.         Depreciation and amortisation expense

462.900

422.000

884.900

 

f.          Power and Fuel

842.400

812.700

1655.100

 

g.         Other Expenditure

646.300

603.000

1249.300

 

Total Expenditure

7386.800

7198.300

14585.100

3

Profit from Operations before Other Income, Finance Costs, Exchange Currency Fluctuation and Exceptional Items (1-2)

650.600

923.900

1574.500

4

Other Income

39.800

73.200

113.000

5

Profit from ordinary activities before Finance Costs, Exchange Currency Fluctuation and Exceptional Items (3+4)

690.400

997.100

1687.500

6

Finance Costs

247.100

239.100

486.200

7

Profit from ordinary activities after Finance Costs but before Exchange Currency Fluctuation and Exceptional Items (5-6)

443.300

758.000

1201.300

8

Exchange Currency Fluctuation Loss / (Gain)

(415.400)

457.200

41.800

9

Exceptional Items

--

--

--

10

Profit from Ordinary Activities before Tax (7-8-9)

858.700

300.800

1159.500

11

Provision for Tax

 

 

 

 

-           Current Tax

152.500

106.500

259.000

 

-           Deferred Tax

100.600

(25.900)

74.700

 

-           Provision for Tax Relating to Earlier Years

(148.000)

--

(148.000)

12

Net Profit from Ordinary Activities after Tax (10-11)

753.600

220.200

973.800

13

Extraordinary Items (Net of Tax Expense)

--

--

--

14

Net Profit for the Period (12-13)

753.600

220.200

973.800

15

Paid Up Equity Share Capital (Rs.10 each fully paid up)

574.200

574.200

574.200

16

Paid Up Debt Capital*

--

--

1500.000

17

Reserves excluding Revaluation Reserves as per balance sheet of

previous accounting year

--

--

--

18

Debenture Redemption Reserve (included above)

--

--

750.000

19

Basic EPS for the Period (Not annualised)

13.12

3.83

16.96

20

Diluted EPS for the Period (Not annualised)

13.12

3.83

16.96

21

Debt Equity Ratio**

--

--

0.55

22

Debt Service Coverage Ratio***

--

--

2.16

23

Interest Service Coverage Ratio****

--

--

6.49

 

 

 

 

 

 

PART II

 

 

 

A

PARTICULARS OF SHAREHOLDING

 

 

 

1

Public Shareholding

 

 

 

 

-           Percentage of Shareholding

28301866

28738006

28301866

 

-           Number of Shares

49.29%

50.05%

49.29%

2

Promoters and Promoter Group Shareholding

 

 

 

(a)

Pledged/Encumbered

 

 

 

 

-           Number of shares

1050000

--

1050000

 

-           Percentage of shares (as a % of the total shareholding of promoter and promoter group)

3.61%

--

3.61%

 

-           Percentage of shares (as a % of the total shareholding of the total share capital of the Company)

1.83%

--

1.83%

(b)

Non-Encumbered

 

 

 

 

-           Number of shares

28068634

28682494

28068634

 

-           Percentage of shares (as a % of the total shareholding of promoter and promoter group)

96.39%

 

100.00%

 

96.39%

 

 

-           Percentage of shares (as a % of the total shareholding of the total share capital of the Company)

48.88%

49.95%

48.88%

 

 

Particulars

3 months ended 30th September 2012

B

INVESTOR COMPLAINTS

 

 

-           Pending at the beginning of the quarter

--

 

-           Received during the quarter

63

 

-           Disposed of during the quarter

63

 

-           Remaining unresolved at the end of the quarter

--

 

* Paid up Debt Capital comprises of listed Debentures only ** Debt Equity Ratio = Total Debt / Equity

*** Debt Service Coverage Ratio (DSCR) = (EBDIT - Current Tax) / (Gross Interest + Scheduled Principal Repayment of Long Term Debts) **** Interest Service Coverage Ratio (ISCR) = (EBDIT - Current Tax) / Gross Interest

 

SEGMENT WISE REVENUE, RESULTS AND CAPITAL EMPLOYED UNDER CLAUSE 41 OF THE LISTING AGREEMENT FOR THE QUARTER / HALF YEAR ENDED 30TH SEPTEMBER 2012

(Rs. in millions)

Particulars

3 Months Ended

30th September 2012

3 Months Ended

30th June 2012

Half Year Ended

30th September 2012

 

Unaudited

Unaudited

Unaudited

Segment Revenue

 

 

 

a) Technical Textiles Business (TTB)

4345.400

4291.200

8636.600

b) Chemicals and Polymers Business (CPB)

2063.100

2135.200

4198.300

c) Packaging Film Business (PFB)

1637.400

1698.700

3336.100

Total Segment Revenue

8045.900

8125.100

16171.000

Less: Inter Segment Revenue

8.500

2.900

11.400

Net Sales / Income from Operations

8037.400

8122.200

16159.600

Segment Results

(Profit before Interest and Tax from each Segment)

 

 

 

a) Technical Textiles Business (TTB)

326.000

347.000

673.000

b) Chemicals and Polymers Business (CPB)

420.700

645.200

1065.900

c) Packaging Film Business (PFB)

57.200

44.300

101.500

Total Segment Results

803.900

1036.500

1840.400

Less/(Add): i) Finance Costs

247.100

239.100

486.200

ii) Other Unallocable Expenses Net of Income

(301.900)

496.600

194.700

Total Profit Before Tax

858.700

300.800

1159.500

Capital Employed (Segment Assets Less Segment Liabilities)

 

 

 

a) Technical Textiles Business (TTB)

(Including Capital Work In Progress Rs.98.800 millions as at 30th September 12)

12049.700

12050.100

12049.700

b) Chemicals and Polymers Business (CPB)

(Including Capital Work In Progress Rs.3176.600 millions as at 30th September 12)

12611.200

11482.500

12611.200

c) Packaging Film Business (PFB)

(Including Capital Work In Progress Rs.16.200 millions as at 30th September 12)

4211.400

4294.800

4211.400

Total Capital Employed

28872.300

27827.400

28872.300

Add : Unallocable Assets Less Liabilities

2622.400

2618.600

2622.400

Total Capital Employed In the Company

31494.700

30446.000

31494.700

 

STATEMENT OF ASSETS AND LIABILITIES AS AT SEPTEMBER 30, 2012

(Rs. in millions)

 

Particulars

 

As at 30th September 2012

Unaudited

EQUITY AND LIABILITIES

 

Shareholders' Funds

 

(a) Share capital

584.400

(b) Reserves and surplus

18866.800

Sub-total - Shareholders' funds

19451.200

Non-current liabilities

 

(a) Long-term borrowings

5238.600

(b) Deferred tax liabilities (net)

2246.900

(c) Long-term provisions

152.700

Sub-total - Non-current liabilities

7638.200

Current liabilities

 

(a) Short-term borrowings

3861.600

(b) Trade Payables

4408.800

(c) Other current liabilities

2232.600

(d) Short-term provisions

30.600

Sub-total - Current liabilities

10533.600

 

 

TOTAL - EQUITY AND LIABILITIES

37623.000

ASSETS

 

Non-current assets

 

(a) Fixed assets

23898.200

(b) Non-current investments

923.000

(c) Long-term loans and advances

1108.300

(d) Other non-current assets

26.700

Sub-total - Non-current assets

25956.200

Current assets

 

(a) Current investments

627.200

(b) Inventories

4562.400

(c) Trade receivables

4735.500

(d) Cash and cash equivalents

784.300

(e) Short-term loans and advances

940.900

(f) Other current assets

16.500

Sub-total - Current assets

11666.800

 

 

TOTAL - ASSETS

37623.000

 

Notes:

 

1. The above results were reviewed by the Audit Committee and taken on record by the Board of Directors at its meeting held on 2nd November 2012.

2. During the quarter ended 30th September 2012, KAMA Holdings Limited's ("a promoter group company") shareholding has increased in the Company from 49.82% to 50.58%. Consequently, the Company has become a subsidiary of KAMA Holdings Limited.

3. During the quarter, Chemicals Business has won the prestigious Deming Prize.

4. The Board of Directors have approved the payment of an interim dividend @ 50% i.e. Rs.5/- on each equity share of the nominal value of Rs.10/­-

5. Previous period figures have been regrouped wherever necessary to conform to current quarter classifications.

 

Limited Review:

 

The Limited Review for the quarter and half year ended September 30, 2012 as required under Clause 41 of Listing Agreement has been completed by the Statutory Auditors.

 

FIXED ASSETS

Tangible Assets

v  Freehold Land

v  Leasehold Land

v  Roads

v  Buildings

v  Plant and Machinery

v  Furniture and Fixtures

v  Office Equipment

v  Vehicles

Intangible Assets

v  Goodwill

v  Trade Marks

v  Technical Knowhow

v  Software

 

WEBSITE DETAILS:

 

PRESS RELEASES

 

SRF Q2 PAT INCREASES TO RS.750.000 MILLIONS OVER Q1 PAT OF RS.220.000 MILLIONS

 

v  Q2 revenue at Rs.8040.000 millions, a fall of 12%, as compared to the CPLY

v  Q2 PAT, a reduction of Rs.320.000 millions, as compared to the CPLY

v  Board approves interim dividend of Rs.5 per share

 

Q2 Financials

Gurgaon, 2nd November 2012: SRF Limited, a multi-business entity engaged in the manufacture of chemical based industrial intermediates, reported a net profit after tax (PAT) of Rs.750.000 millions during the second quarter of 2012-13 against Rs.220.000 millions recorded during the previous quarter ended June 2012. Impacted by the prevailing economic slowdown, the company’s Q2 PAT this year, however, dropped by 30 per cent over the corresponding period last year (CPLY) when it had posted a PAT of Rs.1070.000 millions. SRF’s revenue declined from Rs.9140.000 millions to Rs.8040.000 millions, a fall of 12 per cent during the same period year-on-year. The unaudited financial results of SRF were taken on record by SRF’s Board in a meeting held today.

 

As in the previous years, the Board approved an interim dividend at the rate of 50 per cent amounting to Rs. 5 per share.

 

Reflecting on the financial performance of the company, Mr. Ashish Bharat Ram, Managing

 

Director, SRF Limited, commented: “As I had mentioned before, the economic slowdown continues to hamper both volumes and margins and the situation does not appear to be improving any time soon. We are, however, optimistic about our long-term strategies and our ability to withstand the pressure on the margin through continuous improvements in internal efficiencies.”

 

While the segment revenue for the Technical Textiles Business grew by 4% from Rs.4200.000 millions to Rs.4350.000 millions, its operating profit increased by 10% from Rs.300.000 millions to 330.000 millions during the quarter ended September 2012. The Packaging Films Businesses recorded a decline of 45% in its operating profit at Rs.60.000 millions at revenue of Rs.1640.000 millions. The operating profit of the Chemicals and Polymers Business reduced by 77% from Rs.1860.000 millions to Rs.420.000 millions. The segment revenue of the Chemicals and Polymers Business declined by 38% to 2060.000 millions during July-September 2012.

 

H1 Financials

In the first six months of 2012-13, the net profit after tax (PAT) of SRF declined by 49% at Rs.970.000 millions over CPLY. The company’s revenue at Rs.16160.000 millions decreased by 8% over Rs.17530.000 millions recorded during the same period last year. The company’s PBT at Rs.1160.000 millions fell by 58% during the first half of the current financial year over CPLY.

 

Deming Prize

The Chemicals Business of SRF became the second unit of the company to win the prestigious Deming Prize during the period. Earlier in 2004, SRF’s Tyre Cord Business became the first tyre cord company outside Japan to win the honour.

 

About SRF

Established in 1973, SRF as a group has today grown into a global entity with operations in 4 countries. Apart from Technical Textiles Business, in which it enjoys a global leadership position, SRF is a domestic leader in Refrigerants, Engineering Plastics and Industrial Yarns as well. The company also enjoys a significant presence among the key domestic manufacturers of Polyester Films and Fluorospecialities. Building on its in-house R&D facilities for Chemicals Business and Technical Textiles Business, the company strives to stay ahead in business through innovations in operations and product development. A winner of the prestigious Deming Application Prize for two of its businesses namely Tyre Cord and Chemicals, SRF continues to redefine its work and corporate culture with the TQM as its management way.

 

CHEMICALS BUSINESS OF SRF WINS THE PRESTIGIOUS DEMING PRIZE

 

Gurgaon, 9th October 2012: The Chemicals Business of SRF has joined a select group of organisations globally to win the coveted Deming Prize. Awarded by the Union of Japanese Scientists and Engineers (JUSE), the Deming Prize award is considered the Nobel Prize equivalent in the world of quality. The winners were declared by the Deming Prize Committee in Tokyo, today. Earlier in 2004, SRF had earned the distinction of becoming the first tyre cord company outside Japan to win the award.

 

Ashish Bharat Ram, Managing Director, SRF said, “We are proud to have been bestowed this recognition for the second time in SRF. The award reaffirms our commitment to continue to serve our customers efficiently. I wholeheartedly commend the untiring efforts of my colleagues who have been continuously learning and applying the principles and methods of quality management to achieve all round business success.”

 

SRF’s Chemicals Business is engaged in the manufacture of refrigerants, chloromethanes and fluorine based specialty chemicals. The business employs over 600 people, with the manufacturing plant located at Bhiwadi in Rajasthan.

 

Named after Dr. Deming, the man who taught the Japanese about quality, the Deming Prize is highly valued as recognition of outstanding practice of TQM (Total Quality Management) in the pursuit of the strategic objectives of a company. The Deming Prize is awarded through a rigorous process. A diagnosis is carried out in the year prior to the application for the prize. Detailed documents of the company, including improvements made over many years, are examined by Japanese counselors. A business that qualifies at this stage is subjected to a rigorous on-site examination by a group of TQM experts from Japan.

 

CMT REPORT (Corruption, Money Laundering & Terrorism]

 

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

 

1]         INFORMATION ON DESIGNATED PARTY

No 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.54.85

UK Pound

1

Rs.88.40

Euro

1

Rs.72.63  

 

 

INFORMATION DETAILS

 

Report Prepared by :

SMN

 

 

SCORE & RATING EXPLANATIONS

 

SCORE FACTORS

 

RANGE

POINTS

HISTORY

1~10

8

PAID-UP CAPITAL

1~10

8

OPERATING SCALE

1~10

7

FINANCIAL CONDITION

 

 

--BUSINESS SCALE

1~10

8

--PROFITABILIRY

1~10

8

--LIQUIDITY

1~10

7

--LEVERAGE

1~10

7

--RESERVES

1~10

8

--CREDIT LINES

1~10

8

--MARGINS

-5~5

--

DEMERIT POINTS

 

 

--BANK CHARGES

YES/NO

YES

--LITIGATION

YES/NO

NO

--OTHER ADVERSE INFORMATION

YES/NO

NO

MERIT POINTS

 

 

--SOLE DISTRIBUTORSHIP

YES/NO

NO

--EXPORT ACTIVITIES

YES/NO

NO

--AFFILIATION

YES/NO

YES

--LISTED

YES/NO

YES

--OTHER MERIT FACTORS

YES/NO

YES

TOTAL

 

69

 

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

 

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

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

 

 

RATING EXPLANATIONS

 

 

RATING

STATUS

 

 

PROPOSED CREDIT LINE

>86

Aaa

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

 

Unlimited

71-85

Aa

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

 

Large

56-70

A

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

 

Fairly Large

41-55

Ba

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

 

Satisfactory

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

 

Small

11-25

Ca

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

 

Limited with full security

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

 

Credit not recommended

-

NB

                                       New Business

-

 

 

 

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

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