MIRA INFORM REPORT

Report Date :

02.07.2012

IDENTIFICATION DETAILS

Name :	ISMT LIMITED
Registered Office :	Lunkad Towers, Viman Nagar, Pune – 411014, Maharashtra
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	01.09.1999
Com. Reg. No.:	25-016417
Paid Up Capital :	Rs.732.500 Millions
CIN No.: [Company Identification No.]	L27109PN1999LC016417
TAN No.: [Tax Deduction & Collection Account No.]	PNEI00099B
PAN No.: [Permanent Account No.]	AAACJ9917A
Legal Form :	It is a public limited liability company. The company’s shares are listed on the Stock Exchanges
Line of Business :	Manufacturer of Seamless Tubes
No. of Employees :	200 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

Ba (51)

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Maximum Credit Limit :	USD 24748000
Status :	Good
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is an established company having fine track. Trade relations are reported as fair. Business is active. Payments are reported to be usually correct and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

NOTES :

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

ECGC Country Risk Classification List – September 30, 2011

Country Name	Previous Rating (30.06.2011)	Current Rating (30.09.2011)
India	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

LOCATIONS

Registered Office :	Lunkad Towers, Viman Nagar, Pune – 411014, Maharashtra, India
Tel. No.:	91-20-66024901/ 66024905/ 41434100/ 41434101
Fax No.:	91-20-26630779
E-Mail :	legal@ismt.co.in dbhansali@ismt.co.in
Website :	http://www.ismt.co.in
Factory 1:	MIDC Industrial Area, Ahmednagar – 414111, Maharashtra, India
Tel. No.:	91-241-2777960/ 2777845/ 2777946
Fax No.:	91-241-2777363
Factory 2:	MIDC Industrial Area, Baramati – 413133, India
Tel. No.:	91-2112-243861/65
Fax No.:	91-2112-243873
Factory 3:	Jejuri – Morgaon Road, Jejuri – 412303, Maharashtra, India
Tel. No.:	91-2115-253335
Factory 4:	Structo Hydraulics AB Storfors, Stheydan

DIRECTORS

As on 31.03.2010

Name :	Mr. S C Gupta
Designation :	Chairman
Name :	Mr. A. K. Jain
Designation :	Director
Name :	Mr. J P Sureka
Designation :	Director
Name :	Mr. Gourishankar V
Designation :	Nominee Director (IDBI Nominee From 29.09.2009)
Name :	Mr. K. K. Rai
Designation :	Nominee Director (ICICI Nominee)
Name :	Mr. B R Taneja
Designation :	Director
Name :	Mr. Vinod Sethi
Designation :	Director

KEY EXECUTIVES

Name :	Mr. Jayan Nair
Designation :	Company Secretary
Name :	Mr. Salil Taneja
Designation :	Chief Executive Officer (From 01.04.2009)
Name :	Mr. Rajiv Goel
Designation :	Chief Financial Officer
Name :	Mr. Nirmal Chandra
Designation :	President (Projects and Product Development)
Name :	Mr. I A K Prakash
Designation :	Chief Operating Officer

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 31.03.2012

Category of Shareholder	Total No. of Shares	% of total No. of Shares
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	4385216	2.99
Bodies Corporate	71362158	48.71
Sub Total	75747374	51.70
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	75747374	51.70
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	12709464	8.68
Financial Institutions / Banks	1993848	1.36
Foreign Institutional Investors	6484388	4.43
Sub Total	21187700	14.46
(2) Non-Institutions
Bodies Corporate	5567720	3.80
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 million	28053579	19.15
Individual shareholders holding nominal share capital in excess of Rs. 0.100 million	5371880	3.67
Any Others (Specify)	10573130	7.22
Non Resident Indians	3865239	2.64
Trust	6707891	4.58
Sub Total	49566309	33.83
Total Public shareholding (B)	70754009	48.30
Total (A)+(B)	146501383	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	--	--
(1) Promoter and Promoter Group	--	--
(2) Public	--	--
Sub Total	--	--
Total (A)+(B)+(C)	146501383	--

BUSINESS DETAILS

Line of Business :

Manufacturer of Seamless Tubes

Products :

Products Description	Item Code No.
Hot Rolled Bars and Rods of Non Alloysteel	7214
Cast Rounds/ Hot Rolled	72247
Bars and Rods of Alloy Steel	7228
Seamless Tubes and Hollows	7304

PRODUCTION STATUS (As on 31.03.2011)

Particulars	Unit	Installed Capacity*	Actual Production
Seamless Hollows and Tubes	Tones	465000	167187**
Components and Spares, plugs and Dies Rolls and Nos. Mandrels	Nos.	10000	50720***
Cold Rolled Rings	Nos.	8000000	4021080
Steel Bars	Tones	350000	254070

Licensed capacities are not given, as the respective industries are de-licensed.

* The installed capacities as stated above are certified by the Management and relied upon by the Auditors.

** Captive consumption for the year 598 Tonnes (Previous Year 1000 Tonnes).

*** For Captive consumption within division.

GENERAL INFORMATION

No. of Employees :

200 (Approximately)

Bankers :

• Industrial Development Bank of India Limited
• ICICI Bank Limited
• Bank of Baroda
• Bank of India
• Bank of Maharashtra
• Indian Overseas Bank
• State Bank of India
• Andhra Bank
• IKB Deutsche Industrie Bank AG
• Handelsbanken- Stheyden

Facilities :

Secured Loans :	As on 31.03.2011 Rs. in Millions	As on 31.03.2010 Rs. in Millions
Term Loan from Banks
Rupee Loans	3273.100	2159.200
Foreign Currency Loans	4358.400	4561.600
Working Capital Borrowings from Banks
Rupee Loans	549.900	552.600
Foreign Currency Loans	569.400	532.400
Total	8750.800	7805.800

Unsecured Loans :	As on 31.03.2011 Rs. in Millions	As on 31.03.2010 Rs. in Millions
Short Term Loan from Bank	--	250.000
Others
Foreign Currency Convertible Bonds (FCCB)	893.000	902.800
Interest Free Incentive and sales Tax Loan	850.800	1036.600
Total	1743.800	2189.400

Financial Institutions :	IFCI Limited Life Insurance Corporation of India International Finance corporation (Washington)
Banking Relations :	-
Auditors :
Name :	P. G. Bhagwat Chartered Accountant
Name :	J. K. Shah and Company Chartered Accountant
Associates:	Indian Seamless Enterprises Limited Indian Seamless Incorporated, USA Taneja Aerospace and Aviation Limited
Subsidiaries:	ISMT Enterprises SA, Luxembiurg TRIDEN Port and potheyr Company Private Limited, India Structo Hydraulics AB (Stheyden) Structo (UK) Limited, Uk Structo Hydraulics India Limited (India) ISMT Europe AB (Stheyden) Nagapattinam Energy Private Limited, Japan PT ISMT Resources, Indonesia

CAPITAL STRUCTURE

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
17,50,00,000	Equity Shares	Rs.5/- Each	Rs.875.000 Millions
	Unclassified Shares		Rs. 710.000 Millions
	Total		Rs. 1585.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
14,65,01,383	Equity Shares	Rs.5/- Each	Rs.732.500 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2011	31.03.2010	31.03.2009
SHAREHOLDERS FUNDS
1] Share Capital		732.500	732.500	732.500
2] Equity Share Warrants		0.000	0.000	52.900
3] Reserves & Surplus		5454.500	5061.100	4531.100
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		6187.000	5793.600	5316.500
LOAN FUNDS
1] Secured Loans		8750.800	7805.800	7936.100
2] Unsecured Loans		1743.800	2189.400	2187.800
TOTAL BORROWING		10494.600	9995.200	10123.900
DEFERRED TAX LIABILITIES		752.200	416.900	152.900
TOTAL		17433.800	16205.700	15593.300
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		10898.700	6986.600	7165.400
Capital work-in-progress		2214.200	4886.100	4311.300
INVESTMENT		499.700	357.400	264.900
DEFERREX TAX ASSETS		0.000	0.000	0.000
Foreign Currency Monetary Item Translation Account		0.000	49.100	401.800
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	4486.000	3512.200	2785.400
	Sundry Debtors	4387.800	3388.900	2297.100
	Cash & Bank Balances	677.900	623.700	640.500
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	2863.000	2332.600	2267.100
Total Current Assets		12414.700	9857.400	7990.100
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	1690.100	1222.100	1076.100
	Other Current Liabilities	6621.500	4420.500	3222.200
	Provisions	292.600	306.400	268.700
Total Current Liabilities		8604.200	5949.000	4567.000
Net Current Assets		3810.500	3908.400	3423.100
MISCELLANEOUS EXPENSES		10.700	18.100	26.800
TOTAL		17433.800	16205.700	15593.300

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Income	16113.600	11932.700	13002.500
		Other Income	385.600	114.000	141.300
		TOTAL (A)	16499.200	12046.700	13143.800
Less	EXPENSES
		Material Consumed	8743.600	6126.700	7230.600
		Energy	2809.800	2147.100	1705.300
		Direct Manufacturing	569.300	349.600	344.000
		Selling and Distribution	484.600	269.400	432.200
		Personnel	946.900	815.300	774.800
		Overheads	166.600	160.500	144.800
		Foreign Exchange (Gain)/ Loss	57.200	(85.200)	569.500
		TOTAL (B)	13778.000	9783.400	11201.200
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		2721.200	2263.300	1942.600
Less	FINANCIAL EXPENSES (D)		905.600	786.600	824.600
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		1815.600	1476.700	1118.000
Less/ Add	DEPRECIATION/ AMORTISATION (F)		855.400	564.400	558.200
	PROFIT BEFORE TAX (E-F) (G)		960.200	912.300	559.800
Less	TAX (H)		206.600	166.200	(2.500)
	PROFIT AFTER TAX (G-H) (I)		753.600	746.100	562.300
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		548.300	473.000	582.100
Less	APPROPRIATIONS
		Interim Dividend	0.000	0.000	73.300
		Proposed Dividend	183.100	146.500	73.300
		Tax on Interim Dividend	0.000	0.000	12.400
		Tax on Proposed Dividend	29.700	24.300	12.400
		General Reserve	500.000	500.000	500.000
	BALANCE CARRIED TO THE B/S		589.100	548.300	473.000
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	3049.500	1660.400	3227.000
		Freight on Export	235.100	95.400	247.700
	TOTAL EARNINGS		3284.600	1755.800	3474.700
	IMPORTS
		Raw Materials	3571.100	169.200	450.100
		Stores & Spares	492.000	419.300	229.500
		Capital Goods	81.900	169.200	450.100
	TOTAL IMPORTS		4145.000	757.700	1129.700
	Earnings Per Share (Rs.)		5.14	5.09	3.84

QUARTERLY RESULTS

PARTICULARS	30.06.2011	30.09.2011	31.12.2011
	1^st Quarter	2^nd Quarter	3^rd Quarter
Net Sales	4791.700	5220.900	4719.300
Total Expenditure	4118.600	4652.100	4252.200
PBIDT (Excl OI)	673.100	568.800	467.100
Other Income	54.900	35.500	42.700
Operating Profit	728.000	604.300	509.800
Interest	266.000	250.000	312.500
Exceptional Items	0.000	0.000	0.000
PBDT	462.000	354.300	197.300
Depreciation	202.400	207.300	224.300
Profit Before Tax	259.600	147.000	(27.000)
Tax	74.000	42.100	(44.700)
Provisions and contingencies	0.000	0.000	0.000
Profit After Tax	185.600	104.900	17.700
Extraordinary Items	0.000	0.000	0.000
Prior Period Expenses	0.000	0.000	0.000
Other Adjustments	0.000	0.000	0.000
Net Profit	185.600	104.900	17.700

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	4.56	6.19	4.28
Net Profit Margin (PBT/Sales)	(%)	5.95	7.65	4.31
Return on Total Assets (PBT/Total Assets}	(%)	4.11	5.42	3.69
Return on Investment (ROI) (PBT/Networth)		0.15	0.16	0.11
Debt Equity Ratio (Total Liability/Networth)		3.08	2.67	2.76
Current Ratio (Current Asset/Current Liability)		1.44	1.66	1.75

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	No
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	--
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

OPERATIONS

While incremental capacity became available during the year leading to higher production at Baramati plant, the volumes at Ahmednagar plant theyre flat. Expansion of both, the size range and the product mix was targeted and achieved during the year.

FINANCE

There were frequent increases in the bank rates on account of higher inflation. Hotheyver by optimizing the foreign currency borrowings, where the libor rates continued to be low, the Company could limit the adverse impact and finance cost which came down from 6.6% to 5.6% of the sales. With over 30% of Export Sales in Euro denomination, the Company has started borrowing in Euro to create a natural hedge.

MANAGEMENT DISCUSSION AND ANALYSIS

OVERVIEW

2010-11 marked an Historical year for ISMT Limited. The Company recorded Highest ever;

Net Sales : Rs. 16113.600 Millions

Operating Profit (EBIDTA) : Rs. 2778.400 millions

Tube Production : 167,187 MT

Tube Exports : 44,171 MT

Steel Production : 254,070 MT

External Steel Sales : 107,357 MT

With the commencement of commercial production of Seamless Tube Expansion Project at Baramati plant, ISMT now has the largest Seamless Tube manufacturing capacity of 465,000 tpa in India. The Company is now ready to take advantage of the growing demand of Seamless Tubes both domestically and internationally across the core sectors of the Industry.

The Steel Capacity during the year was also increased from 250,000 tpa to 350,000 tpa. Their renetheyd focus on the Steel segment, and in particular, their strategy to increase steel sales while outsourcing commodity steel billets for in house Tube manufacturing resulted in an increase in external steel sales by 14% in volume terms.

With gradual ramp up of new Expanded Capacities planned, no major fresh capital expenditure is anticipated in the immediate future.

The 40 MW Captive Potheyr Plant Project undertaken to address the second biggest cost element of the company after Raw material i.e Energy Cost, is now nearing completion. The Project is expected to result in assured and continuous potheyr availability apart from reduction in Energy cost.

Another remarkable achievement during the year was turnaround of Structo Hydraulics AB, Company's subsidiary in Stheyden. While Europe crisis still persists, Structo has turned the corner within a short span of two years, benefiting from aggressive cost rationalization exercise undertaken.

The Company ended the year with Net Sales of Rs. 16113.600 millions while Net Profit and Earning Per Share stood at Rs. 753.600 millions and Rs. 5.14 per share respectively.

Domestic Tube and Steel Sales grew by 24% and 31% respectively. Exports grew by over 87% on back of a lotheyr base of last year.

(Rs. In millions)

2010-11 2009-10 % Change

Net Sales 16110.000 11850.000 36%

Domestic

-Tube 7510.000 6050.000 24%

-Steel 5320.000 4050.000 31%

Exports 3280.000 1760.000 87%

While Operating profit (EBIDTA) in absolute terms during the year was higher at Rs. 2778.400 millions, an increase by 28% over previous year, the Raw material price volatility continue to impact margins. The same, hotheyver is partially offset by holding higher raw material inventory.

On the operational front, the integration of the new Seamless Tube line with the existing line at Baramati remained the focus area. This process took longer time than estimated on account of quality related issues, with consequential adverse impact on the profit margins of the Company. Apart from streamlining the enhanced capacities, the focus during the year remained on adding new customers and sales intermediaries across major geographies and developing new products.

Absence of any decisive step by the Indian Government on imposing anti dumping duty on Chinese producers continue to impact domestic margins in some sectors.

OUTLOOK

The overall outlook for the Company remains positive with new internal capacities now going on stream. Sales which had stagnated over the last few years, largely due to capacity constraints, grew steeply as compared to the previous years. ISMT's strategy is to fill up the capacity initially with commodity products and then gradually, over time, to shift the product mix in favour of specialized, higher value added products.

As they move ahead they expect economies of scale to kick in which would benefit us across the value chain right from bulk sourcing, to progressive reduction in unit consumption of energy, to productivity improvements, and increases in sales values per customer.

STATEMENT OF AUDITED FINANCIAL RESULTS FOR THE QUARTER AND YEAR ENDED 31st MARCH, 2012

(Rs. In Millions)

Sr. No.	Particulars	31.03.2012	31.12.2011	31.03.2012
		Quarter Ended	Quarter Ended	Year Ended
		Standalone
		Unaudited	Unaudited	Audited
1	Gross Sales/ Income from Operations	7426.600	7231.100	29806.000
	Less : Inter Segment Transfers	2288.400	1892.500	7927.200
	Inter Division Transfers	309.300	384.000	1648.400
	Subsidiary Company Transfers	--	--	--
	Excise Duty	357.300	363.500	1436.200
	(a) Net Sales/ Income from Operations	4471.600	4591.100	18794.200
	(b) Other Operating Income	220.900	141.700	650.100
	Total Income from Operations (a+b)	4692.500	4732.800	19444.300
2	Expenses
	(a) Consumption of Raw Materials	2277.500	2506.800	10000.700
	(b) Purchase of stock-in-trade	-	-	-
	(c) Changes in inventories of finished goods, work-in-progress and stock-in-trade	27.900	-118.000	-392.600
	(d) Employee benefit expenses	293.500	286.600	1134.700
	(e) Depreciation and Amortisation Expense	211.000	224.300	845.000
	(f) Other Expenses :
	(i) Energy	859.900	859.000	3436.300
	(ii)Other Direct Expenditure	664.300	614.600	2651.800
	(iii) Other Expenditure	60.200	47.900	203.100
	Total Expenses	4394.300	4421.200	17879.000
3	Profit from Operations before other income, finance costs	298.200	311.600	1565.300
	and exceptional items (1-2)
4	Other Income	111.300	42.700	244.400
5	Profit from ordinary activities before finance costs and	409.500	354.300	1809.700
	exceptional items ( 3+4)
6	Finance Costs	369.600	322.200	1207.900
7	Profit from ordinary activities after finance costs but before	39.900	32.100	601.800
	exceptional items and foreign exchange( Gain)/ Loss( 5-6)
8	Exceptional items	-	-	-
9	Foreign Exchange (Gain)/ Loss	122.800	69.000	315.200
10	Profit/ (Loss) from ordinary activities before tax (7- 8-9)	-82.900	-36.900	286.600
11	Tax Expenses : Current Tax ( including P.Y. Rs. 83.200 Millions)	-15.200	77.800	144.000
	Add : MAT Credit Entitlement ( including P.Y. Rs. 826.000 Millions)	-15.700	77.800	143.400
	Less : Deferred Tax Charge /(Credit)	-61.200	-54.600	00.100
12	Net Profit/ (Loss) from ordinary activities after tax (10-11)	-22.200	17.700	285.900
13	Extraordinary items	-	-	-
14	Net Profit/ (Loss) for the period (12-13)	-22.200	17.700	285.900
15	Share of Minority Interest	-	-	-
16	Net Profit/ (Loss) after tax and Minority Interest (14-15)	-22.200	17.700	285.900
17	Paid-up Equity Share Capital (Face Value of Rs.5/- per share)	732.500	732.500	732.500
18	Reserves excluding Revaluation Reserves as per	-	-	5141.000
	Balance Sheet of previous accounting year.
19	Earnings per share before extraordinary items
	Basic and Diluted Earnings per share of Rs.5/- each (Rs) ( not annualised)	-0.15	0.12	1.95
20	Earnings per share after extraordinary items
	Basic and Diluted Earnings per share of Rs.5/- each (Rs) ( not annualised)	-0.15	0.12	1.95
PART-II
A	SELECT INFORMATION FOR THE QUARTER AND YEAR ENDED 31st MARCH, 2012.
	PARTICULARS OF SHAREHOLDING
1	Public Shareholding
	Number of Shares	70754009	70759176	70754009
	Percentage of Shareholding	48.30%	48.30%	48.30%
2	Promoters and promoter group shareholding
	(a) Pledged / Encumbered
	Number of Shares	NIL	NIL	NIL
	Percentage of Shares ( as a % of the total shareholding of promoter and promoter group )	-	-	-
	Percentage of Shares ( as a % of the total share capital of the company )	-	-	-
	(b) Non - Encumbered
	Number of Shares	75747374	75742207	75747374
	Percentage of Shares ( as a % of the total shareholding of promoter	100.00%	100.00%	100.00%
	and promoter group )
	Percentage of Shares ( as a % of the total share capital of the company )	51.70%	51.70%	51.70%
B	INVESTOR COMPLAINTS
	Pending at the beginning of the quarter	NIL
	Received during the quarter	8
	Disposed of during the quarter	8
	Remaining unresolved at the end of the quarter	NIL

SEGMENT WISE AUDITED FINANCIAL RESULTS FOR THE QUARTER AND YEAR ENDED 31^ST MARCH, 2012

(Rs. In Millions)

Sr. No.	Particulars	31.03.2012	31.12.2011	31.03.2012
		Quarter Ended	Quarter Ended	Year Ended
		Standalone
		Unaudited	Unaudited	Audited
1	Segment Revenue
	a) Gross Sales – Tube	3684.500	3811.000	15498.000
	Less: Inter Division	309.300	384.000	1648.400
	Sales to Subsidiary Company Excise Duty	--	--	--
	Sub Total	3160.700	220.700	832.000
	.
	b) Gross Sales – Steel	3742.100	3420.100	14308.000
	Less: Inter Segment	2288.400	1892.500	7927.200
	Excise Duty	142.800	142.800	604.200
	Sub Total	1310.900	1384.800	5776.600
	.
	Total Net Sales/Income from Operations	4471.600	4591.100	18794.200
	.
2	Segment Results
	(profit after Deprecation and before finance costs Foreign Exchange (Gain) / Loss, Unallocable Income (net)
	a) Tube	199.500	249.500	1065.600
	b) Steel	111.600	74.200	547.200
	Total	311.100	323.700	1512.800
	Less: Finance Costs	369.600	322.200	1207.900
	Foreign Exchange (Gain) / Loss	122.800	69.0000	315.200
	Add: Unallocable Income (Net of Unallocable Expenses)	98.400	30.600	196.900
	Total Profit Before Tax	(82.900)	(36.900)	286.600
	Less: Current Tax (Including P. Y. Rs.83.200 Millions	(15.200)	77.800	144.000
	Add: MAT Credit Entitlement (Including P.Y. Rs.82.600 Millions)	(15.700)	77.800	143.400
	Less: Deferred Tax Charge / (Credit)	(61.200)	(54.600)	0.100
	Total Profit After Tax	(22.200)	17.700	285.900
	Less: Share of Minority Interest	--	--	--
	Profit After Minority Interest	(22.200)	17.700	285.900
	.
3	Capital Employed (Segment Assets – Segment Liabilities)
	a) Tube	13248.100	13955.900	13248.100
	b) Steel	1604.700	1701.200	1604.700
	c) Unallocable	(8979.400)	(9983.300)	(8979.400)

STATEMENT OF ASSETS AND LIABILITIES

(Rs. In Millions)

Particulars	Standalone
	31.03.2012
	Audited
A EQUITY AND LIABILITIES
1 Shareholders Funds
a) Share capital	732.500
b) Reserve and Surplus	5141.000
Sub-Total Shareholders Funds	5873.500
.
2 Minority Interest	--
.
3 Non-Current Liabilities
a) Long Term Borrowings	8693.900
b) Deferred Tax Liabilities (Net)	752.300
c) Long Term Provision	53.000
Sub-Total-Non Current Liabilities	9499.200
.
4 Current Liabilities
a) Short Term Borrowings	1150.800
b) Trade Payables	5917.500
c) Other Current Liabilities	5884.700
d) Short Term provisions	166.600
Sub-Total-Current Liabilities	13119.600
.
TOTAL EQUITY AND LIABILITIES	28492.300
.
B ASSETS
1 Non-Current Assets
a) Fixed Assets	14265.900
b) Goodwill on Consolidation	0.000
c) Non-Current Investment	484.700
d) Long Term Loans and Advances	145.500
e) Other Non Current Assets	981.500
Sub-Total-Non-Current Assets	15877.600
.
2 Foreign Currency Monetary Item Translation difference Account	50.200
.
3 Current Assets
a) Current Investment	15.000
b) Inventories	4916.300
c) Trade Receivables	4117.500
d) Cash and Bank Balances	899.800
e) Short Term Loans and Advances	1403.300
f) Other Current Assets	1212.600
Sub-Total-Current Assets	12564.500
.
TOTAL ASSETS	28492.300

NOTES:

1. The company has during the current quarter utilized an amount of Rs. 39.700 Millions and for the year ended as on 31st March, 2012 has utilised Rs.127.200 Millions out of the proceeds from Foreign Currency Convertible Bonds towards object of the issue.

2. The Board of Directors at their meeting held on 28th May,2012 has recommended a dividend of Rs.0.75 each per equity share for the financial year 2011-12.

3. The Company has changed its accounting policy with regard to recognition of exchange differences arising on translation of foreign currency borrowings by following an appropriate hedge accounting policy and applying the principles set out in AS – 30 Financial Instruments : Recognition and Measurement. The Company has w.e.f. 1st April, 2011 designated borrowings in foreign currency, other than those utilised for capital expenditure, as hedge instrument to hedge its foreign currency risks of highly probable forecast transactions (of revenue streams)to be accounted as cash flow hedge. As at 31st March 2012 the net exchange difference loss on foreign currency borrowings amounting to Rs. 310.900 Millions has been recognised in Hedge Reserve Account. During the current quarter Rs. 365.800 Millions has been credited to Hedge Reserve Account.

Pursuant to the notification dated 29th December, 2011 issued by the Ministry of Corporate Affairs amending the Accounting Standard 11, the Company has exercised the option as per Para 46 A inserted in the standard for long term monetary liabilities. Consequently, on long term Monetary Liabilities, other than covered under Hedge accounting and utilised for capital expenditure, an amount of Rs.50.200 Millions is carried forward in the Foreign Currency Monetary Item Translation Difference Account (FCMITDA) as on 31st March 2012 and the same will be amortized over the life of the monetary liabilities. . During the current quarter Rs. 19.500 Millions has been credited to FCMITDA.

Due to above changes, Loss (net of tax) for the current quarter is overstated by Rs.260.300 Millions and Profit (net of tax) for the year ended 31st March 2012 is overstated by Rs.243.900 Millions.

4. Based on the advice on treatment of Amalgamation Reserve created in terms of the Scheme of Arrangement, sanctioned by the Hon'ble High Court, Bombay, the Company has adjusted depreciation of Rs.16.900 Millions and Rs.67.200 Millions during current quarter and for the year ended 31st March, 2012 respectively against the Amalgamation Reserve.

5. The insurance claim lodged during the quarter ended 30th September, 2011 has been accounted on accrual basis and a note to this effect was given in the previous quarterly results. The preceding quarter’s limited review report has been qualified with respect to the said note and the Company expects that the said claim to be settled by the insurance Company without any material deviation.

6. Considering the certainty of refund against Regulatory Liability Charges to be received from Maharashtra State Electricity Distribution Company Limited (MSEDCL), the company has recognized the balance amount of refund Rs.98.800 Millions.

7. The figures of the last quarter of year ended 31st March, 2012 are the balancing figures between audited figures in respect of the full financial year and the published year to date figures up to the third quarter of the current financial year.

8. The consolidated financial statements have been prepared in accordance with Accounting Standard (AS) 21.

9. The comparative figures are regrouped and reclassified to meet the current quarter's classification.

FIXED ASSETS:

• Leasehold Land
• Freehold Land
• Building
• Plant and Machinery
• Furniture and Fixture
• Office Equipment
• Vehicles
• Technical Know – How
• Software Development

WEBSITE DETAILS:

SEAMLESS GROWTH

Subject is one of the producers of seamless tubes in India and the only domestic player to be backward integrated. Though the company faces demand slowdown in the medium term, both locally and globally, as well as higher competition, the recent commissioning of the premium quality finishing (PQF) mill and the upcoming power plant are expected to improve its profitability. They initiate coverage on ISMT with a fundamental grade of 3/5, indicating that its fundamentals are good relative to other listed securities in India.

DIVERSIFICATION PROVIDES BETTER INDUSTRY POSITIONING

ISMT produces tubes of varying outer diameters (ODs) up to 273 mm which enables it to cater to the varied industries, securing a diversified revenue portfolio. The diversified industry mix helps it to negotiate the vagaries of end-user industries better than its peers. However, ODs above 273 mm not produced by the company have better margins though the end-user market is mainly Oil and Gas. ISMT’s current capacity utilisation is low at ~40% due to significant expansion by the company in FY11 and also overcapacity in the industry. They expect utilisation to improve to 47% in FY14 supported by growth in underlying industries.

CAPTIVE POWER PLANT + PROCESS IMPROVEMENT ⇒ MARGIN EXPANSION

The commissioning of its captive power plant (CPP) coupled with the improved capacity utilisation of the PQF mill will result in margin expansion from an expected 14.1% (down from 16.3% in FY11 due to demand slowdown and increased competition) in FY12 to 15.3% in FY14. The newly added PQF mill will also expand its addressable market and enable cost savings for the company due to higher efficiency leading to improvement in margins.

SUSCEPTIBLE TO INDUSTRIAL CYCLICALITIES AND CHINESE DUMPING

ISMT is exposed to cyclicality of the end-user industries. Also, raw material being a significant part of the cost structure, any upward price movement is bound to result in margin erosion for the company. Aggressive imports of seamless tubes from China have lowered profitability for domestic manufacturers. Countries like the US and Europe has already levied anti- dumping duty on Chinese imports; a similar move in India will benefit the industry.

EXPECT THREE-YEAR REVENUE CAGR OF 12.3% AND MARGINS OF ~15%

They expect revenues to grow at a CAGR of 12.3% to Rs 24.7 bn in FY14 driven by 9.3% volume CAGR. They believe that-despite challenges in the industry-CPP commissioning and process improvement will result in margin expansion (though it would be lower compared to its past performance) over next two years. Adjusted PAT is estimated grow at 12% over the same period.

VALUATIONS: CURRENT MARKET PRICE HAS STRONG UPSIDE

CRISIL Research has assigned price to earnings (P/E) of 5x on FY14E EPS of Rs 8.1 to arrive at a fair value of Rs 40 per share.

PRESS RELEASE:

ISMT COMMENCES PRODUCTION AT ITS 40 MW CAPTIVE POWER PLANT

THE PLANT AIMS TO CATER TO OVER 80% OF ISMT’S POWER REQUIREMENT

29th May 2012

ISMT Limited has officially commissioned its 40 MW, thermal, coal based, captive Power Plant. Located at Chandrapur district (Maharashtra), the Power Plant was conceived to address the rising energy costs of the company. The plant commenced commercial production from 28th May 2012. The Power generated is wheeled using the state electricity grid to all three manufacturing plants located at Ahmednagar, Baramati and Jejuri. 

The captive plant will cater to over 80% of the company's power requirement, thereby helping the Company to substantially reduce its variable costs.

Elaborating on the benefits of the plant, ISMT’s CEO, Mr. Salil Taneja said “the commissioning of this plant significantly de-risks the operations of the company by hedging against the possibility of future increases in power cost by the Govt. of Maharashtra” 

CRISIL'S INDEPENDENT EQUITY RESEARCH RATES ISMT AS A COMPANY WITH 'GOOD FUNDAMENTALS' AND 'STRONG UPSIDE'

4th April 2012

CRISIL Research has assigned a CRISIL IER 5/5 on valuation grade indicating that the company has a very strong upside. The report also gives fundamental grade of 3/5 to ISMT Limited - indicating that the company's fundamentals are 'good' relative to other listed equity securities in India.

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 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 theyre 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 bettheyen 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.56.31
UK Pound	1	Rs.88.06
Euro	1	Rs.70.91

INFORMATION DETAILS

Report Prepared by :

BSN

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	5
--RESERVES	1~10	6
--CREDIT LINES	1~10	5
--MARGINS	-5~5	---
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		51

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 theyighted scores obtained from each of the major sections of this report. The assessed factors and their relative theyights (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	--

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