MIRA
INFORM REPORT
|
Report Date : |
13.07.2012 |
IDENTIFICATION DETAILS
|
Name : |
SHRIRAM EPC LIMITED |
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Registered
Office : |
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Country : |
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Financials (as
on) : |
31.03.2011 |
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Date of
Incorporation : |
12.06.2000 |
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Com. Reg. No.: |
18-45167 |
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Capital
Investment / Paid-up Capital : |
Rs.442.624
Millions |
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CIN No.: [Company Identification
No.] |
L74210TN2000PLC045167 |
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TAN No.: [Tax Deduction &
Collection Account No.] |
CHES20276E |
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PAN No.: [Permanent Account No.] |
AAFCS1410C |
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Legal Form : |
A Public Limited Liability Company. The Company’s Shares are Listed on
the Stock Exchange. |
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Line of Business
: |
Subject is a service provider of integrated design, engineering, procurement,
construction, and project management services geared towards the development
of renewable energy projects, process and metallurgy and municipal service
projects throughout India. |
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No. of Employees
: |
350 [Approximately] |
RATING & COMMENTS
|
MIRA’s Rating : |
A (62) |
|
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 19000000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a part of Shriram Group. It is an established company having fine track. Financial position of
the company appears to be sound. Trade relations are reported as fair. Business
is active. Payments are reported to regular and as per commitments. The company can be considered good 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 – September 30, 2011
|
Country Name |
Previous Rating (30.06.2011) |
Current Rating (30.09.2011) |
|
|
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
LOCATIONS
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Registered / Administrative Office : |
Sigappi Achi Building, 4th Floor, 18/3 Rukmini Lakshmipathi
Road, Egmore, Chennai – 600008, Tamilnadu, India |
|
Tel. No.: |
91-44-49015678/49005555 |
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Fax No.: |
91-44-49015655/49005599 |
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E-Mail : |
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Website : |
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Head Office : |
No.9, Vanagaram Road, Ayanambakkam, Chennai - 600095, Tamilnadu,
India |
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Tel. No.: |
91-44-26531592/3572/3313/3109 |
|
Fax No.: |
91-44-26532780 |
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Factory : |
LOCATED AT: ·
Puducherry ·
Chennai ·
Gummidipoondi ·
Umbergaon (Gujarat) |
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Branch Office : |
8 - IT Chambers, 8th Floor; Mani Square, 164/1 Maniktala Main Road, E M, Bypass, Kolkata - 700 054, West Bengal, India Tel : 91-33-30011800/1900 Fax : 91-33-30011942 Email : shriramepc_kol@vsnl.net Unit No.309-310-311, Tel : 91-124-4001341/42/43/44 Fax : 91-124-4001345 Email : shriramepc@airtelmail.in Located at Mumbai, |
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Overseas Office : |
Netherland’s Office Shriram EPC Europe BV, 's-Gravelandseweg, 3343125 BK, Schiedam Tel : +31(0)10-2350 900 Email : info@shriramepc.eu Website : www.shriram.eu Shriram EPC Add.: Room 2426E, 24th floor, Building B, Wantong New
World, No.2, Fuwai treet, Xicheng District, Tel : 0086-10-68024682 Email : shriramepc.bj@gmail.com |
DIRECTORS
As on 31.03.2011
|
Name : |
Mr. Arun Duggal |
|
Designation : |
Chairman |
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Name : |
Mr. T Shivaraman |
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Designation : |
Managing Director |
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Name : |
Mrs. Vathsala Ranganathan |
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Designation : |
Director |
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Name : |
Mr. S R Ramakrishnan |
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Designation : |
Director |
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Name : |
Mr. R Sundararajan |
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Designation : |
Director |
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Name : |
Mr. R S Chandra |
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Designation : |
Director |
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Name : |
Mr. Sunil Varma |
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Designation : |
Director |
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Name : |
Mr. S Krishnamurthy |
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Designation : |
Director |
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Name : |
Mr. K Madhava Sarma |
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Designation : |
Director |
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Name : |
Mr. Sunil K Kolangara |
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Designation : |
Director |
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Name : |
Mr. S Bapu |
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Designation : |
Director |
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Name : |
Mr. P D Karandikar |
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Designation : |
Director |
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Name : |
Mr. Amjad Shariff |
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Designation : |
Joint Managing Director |
KEY EXECUTIVES
|
Name : |
Mr. K. Suresh |
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Designation : |
Company Secretary |
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Name : |
Mr. R. Dharmarajan |
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Designation : |
Chief Financial Officer |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 30.06.2012
|
Category of
Shareholder |
Total No. of
Shares |
Total
Shareholding as a % of total No. of Shares |
|
(A) Shareholding of Promoter and Promoter Group |
|
|
|
|
|
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|
227217 |
0.51 |
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17048070 |
38.44 |
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|
17275287 |
38.96 |
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Total shareholding of Promoter and Promoter Group (A) |
17275287 |
38.96 |
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(B) Public Shareholding |
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|
1728407 |
3.90 |
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|
317646 |
0.72 |
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|
1365778 |
3.08 |
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|
3411831 |
7.69 |
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|
4236110 |
9.55 |
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|
1553494 |
3.50 |
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|
439378 |
0.99 |
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|
25716 |
0.06 |
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|
26340 |
0.06 |
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|
13481762 |
30.40 |
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|
73229 |
0.17 |
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|
36808 |
0.08 |
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|
3786779 |
8.54 |
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|
23659616 |
53.35 |
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Total Public shareholding (B) |
27071447 |
61.04 |
|
Total (A)+(B) |
44346734 |
100.00 |
|
(C) Shares held by Custodians and against which Depository Receipts
have been issued |
- |
- |
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- |
- |
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- |
- |
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- |
- |
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Total (A)+(B)+(C) |
44346734 |
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Subject is a service provider of integrated design, engineering,
procurement, construction, and project management services geared towards the
development of renewable energy projects, process and metallurgy and
municipal service projects throughout India. |
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Products : |
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PRODUCTION STATUS [AS ON 31.03.2011]
|
Particulars |
31.03.2011 Units Produced |
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In
Nos |
In
MWs |
|
Wind Turbine Generators – 250 KW |
112 |
32.80 |
NOTE: The installed capacities have not been
disclosed since they are variable subject to utilization of manufacturing
facilities given the nature of its operations.
GENERAL INFORMATION
|
Customers : |
·
Ahemedabad Urban
Development Corporation ·
Birla White ·
Chennai Petroleum
Corporation Limited ·
Cochin Refineries
Limited ·
·
Kerala Feeds Limited ·
·
Metallurgical and
Engineering Consultants ( ·
Indo Rama Synthetics ( ·
Jindal Steel and Power
Limited ·
Laxmi Energy and Foods
Limited ·
Rashtriya Ispat Nigam
Limited ( ·
Sree Jayajothi Cements
Limited ·
Konkola Copper Mines
plc, ·
National Mineral
Development Corporation ·
Reliance Industries
Limited ·
Steel Authority of India
Limited ·
Karnataka Urban
Infrastructure Development and Finance Corporation ·
·
Orient Green Power
Company Limited ·
Tata Steel ·
Tamilnadu Water Supply
and Drainage Board ·
Vedanta Group ·
Prakash Industries
Limited |
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No. of Employees : |
350 [Approximately] |
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Bankers : |
·
The Hongkong And Shanghai Banking Corporation
Limited, 76, Cathedral Road, Chennai-600086, Tamilnadu, India ·
Indian Bank, Thousand Light Branch, Kannammai Building,
611, Anna Salai, Chennai - 600 006, Tamilnadu, India ·
Indusind Bank Limited ·
Punjab National Bank ·
Citi Bank Limited ·
State Bank of India |
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Facilities : |
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Banking
Relations : |
-- |
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Financial Institutions : |
L and T Infrastructure Finance Company Limited |
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Auditors : |
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Name : |
Deloitte Haskins and Sells Chartered Accountants |
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Subsidiaries : |
·
Shriram EPC (Singapore) Pte Ltd ·
Blackstone Group Technologies (Private) Limited ·
Chemprojects Consulting Private Limited |
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Associates: |
·
Haldia Coke and Chemicals Private Limited (with
effect from 29.06.2010) ·
Ennore Coke Limited (upto 21.06.2010) ·
Ennore Coke Limited (Subsidiary of Haldia Coke
and Chemicals Private Limited (with effect from 01.07.2010) ·
Shriram SEPL Composites Private Limited ·
Shriram Angerlehner Composites Private Limited |
|
|
|
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Jointly Controlled Entities: |
·
Hamon Shriram Cottrell Private Limited ·
Leitner Shriram Manufacturing Limited |
CAPITAL STRUCTURE
After 09.09.2011
Authorised Capital : Rs.850 Millions
Issued, Subscribed & Paid-up Capital : Rs. 443.467 millions
As on 31.03.2011
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
65000000 |
Equity Shares |
Rs.10/- each |
Rs.650.000 Millions |
|
20000000 |
Convertible Preferences Shares |
Rs.10/- each |
Rs.200.000 Millions |
|
|
Total |
|
Rs.850 Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
44262399 |
Equity Shares |
Rs.10/- each |
Rs.442.624
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 |
442.624 |
439.138 |
433.489 |
|
|
2] Share Application Money |
0.197 |
0.282 |
0.000 |
|
|
3] Reserves & Surplus |
4421.791 |
3761.910 |
3338.025 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
5] Employee Stock Option Outstanding |
15.046 |
12.642 |
23.872 |
|
|
NETWORTH |
4879.658 |
4213.972 |
3795.386 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
10697.560 |
5056.451 |
2401.520 |
|
|
2] Unsecured Loans |
1424.763 |
1252.761 |
252.867 |
|
|
TOTAL BORROWING |
12122.323 |
6309.212 |
2654.387 |
|
|
DEFERRED TAX LIABILITIES |
289.364 |
280.213 |
154.280 |
|
|
|
|
|
|
|
|
TOTAL |
17291.345 |
10803.397 |
6604.053 |
|
|
|
|
|
|
|
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APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
1360.049 |
1416.911 |
1030.169 |
|
|
Capital work-in-progress |
1.230 |
0.109 |
35.354 |
|
|
|
|
|
|
|
|
INVESTMENT |
2675.740 |
2106.428 |
1720.122 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
1575.734
|
1775.420 |
782.967 |
|
|
Sundry Debtors |
9242.552
|
8327.021 |
4921.776 |
|
|
Cash & Bank Balances |
4043.110
|
1784.480 |
345.282 |
|
|
Other Current Assets |
0.000
|
0.000 |
0.570 |
|
|
Loans & Advances |
4476.682
|
2348.582 |
2497.030 |
|
Total
Current Assets |
19338.078
|
14235.503 |
8547.625 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
3158.774
|
5986.661 |
4065.534 |
|
|
Other Current Liabilities |
2742.266
|
882.644 |
563.781 |
|
|
Provisions |
182.712
|
86.249 |
99.902 |
|
Total
Current Liabilities |
6083.752
|
6955.554 |
4729.217 |
|
|
Net Current Assets |
13254.326
|
7279.949 |
3818.408 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
17291.345 |
10803.397 |
6604.053 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
|
SALES |
|
|
|
|
|
|
|
Sales, Services and Work Bills |
12821.876 |
11105.176 |
9187.655 |
|
|
|
Other Operating Revenues |
198.863 |
0.000 |
0.000 |
|
|
|
Other Income |
231.570 |
120.247 |
51.887 |
|
|
|
TOTAL (A) |
13252.309 |
11225.423 |
9239.542 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Erection, Construction & Operation Expenses |
10830.305 |
10576.682 |
8082.322 |
|
|
|
Employee Costs |
237.479 |
179.428 |
202.156 |
|
|
|
Other Costs |
285.795 |
228.990 |
154.201 |
|
|
|
Exceptional items- Profit on Sale of Investments |
(233.628) |
0.000 |
0.000 |
|
|
|
Decrease/(Increase) in Stock |
206.850 |
(951.488) |
0.000 |
|
|
|
TOTAL (B) |
11326.801 |
10033.612 |
8438.679 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
1925.508 |
1191.811 |
800.863 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
857.174 |
417.162 |
108.533 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
1068.334 |
774.649 |
692.330 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
120.054 |
103.447 |
63.019 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
948.280 |
671.202 |
629.311 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
252.151 |
224.599 |
229.143 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
696.129 |
446.603 |
400.168 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
1285.672 |
911.782 |
582.484 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Proposed Dividend - 12% |
53.115 |
52.697 |
52.019 |
|
|
|
Provision of dividend-2009-10 inclusive Dividend Tax |
0.065 |
0.099 |
8.841 |
|
|
|
Dividend Tax |
8.833 |
8.752 |
0.000 |
|
|
|
Transfer to General reserve |
17.405 |
11.165 |
10.010 |
|
|
BALANCE CARRIED
TO THE B/S |
1902.383 |
1285.672 |
911.782 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Export Earnings |
166.117 |
0.000 |
48.943 |
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
99.593 |
21.612 |
0.000 |
|
|
|
Capital Goods |
34.653 |
0.000 |
3.807 |
|
|
|
Materials Consumed in Execution of Engineering Construction Contracts |
3206.666 |
1315.198 |
828.353 |
|
|
TOTAL IMPORTS |
3340.912 |
1336.810 |
832.160 |
|
|
|
|
|
|
|
|
|
|
Earnings Per Share
(Rs.) (Basic) |
15.80 |
10.26 |
9.25 |
|
|
|
Earnings Per
Share (Rs.) (Diluted) |
15.80 |
10.05 |
9.25 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2011 |
30.09.2011 |
31.12.2011 |
31.03.2012 |
|
Type |
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
4th
Quarter |
|
Net Sales |
2997.250 |
2221.570 |
2638.550 |
6037.620 |
|
Total Expenditure |
2715.250 |
1908.020 |
2308.880 |
5632.860 |
|
PBIDT (Excl OI) |
282.000 |
313.550 |
329.670 |
404.760 |
|
Other Income |
78.970 |
7.120 |
19.400 |
78.380 |
|
Operating Profit |
360.970 |
320.670 |
349.070 |
483.140 |
|
Interest |
210.790 |
194.400 |
217.880 |
377.930 |
|
PBDT |
150.180 |
126.270 |
131.180 |
105.210 |
|
Depreciation |
31.980 |
30.510 |
28.780 |
30.260 |
|
Profit Before Tax |
118.200 |
95.760 |
102.410 |
74.950 |
|
Tax |
39.310 |
32.890 |
34.230 |
29.830 |
|
Profit After Tax |
78.900 |
62.870 |
68.180 |
45.120 |
|
Net Profit |
78.900 |
62.870 |
68.180 |
45.120 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
PAT / Total Income |
(%) |
5.25
|
3.98 |
4.33 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
7.40
|
6.04 |
6.85 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
4.58
|
4.29 |
6.57 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.19
|
0.16 |
0.17 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
3.73
|
3.15 |
1.95 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
3.18
|
2.05 |
1.81 |
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 |
Yes |
|
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 |
Note: The registered office of the company has been shifted from 5 TV Street, Chennai, Tamilnadu, India to the present address.
OPERATING RESULTS
AND PERFORMANCE
During the year the company recorded a 18% growth in total income on a
standalone basis at Rs.13252.300 millions from Rs.11225.400 millions in the
previous year. Profit before tax and extraordinary items at Rs.714.700 millions
recorded a growth of 6.48% over the previous year (Rs.671.200 millions).
Profit after tax at Rs.696.100 millions recorded a growth of 56% over
the previous year’s figure of Rs.446.600 millions. Earnings per share (EPS)
grew from Rs.10.26 to Rs.15.80. The Company's order book was Rs.31913.000
millions as at March 31, 2011.
CAPITAL STRUCTURE
During the year,
the share capital of the Company was changed/ altered as follows:
Allotment of 3,48,622 Equity shares of Rs.10 each fully paid up under
ESOP 2006 and 2007 schemes.
BUSINESS
HIGHLIGHTS
During the year the Company was awarded several prestigious projects.
Some of these projects and other business initiatives taken by the Board to
position the Company in its growth path as a key player in the EPC business and
as a manufacturer of wind turbines are as under:
1. Multiple orders from Steel Authority of India Limited totaling to
Rs.1758.200 millions.
2. An order over Rs.1000.000 millions from Blue Diamond Australia Pty.
Limited, Australia. For setting up Tank Storage Facility in Queensland,
Australia.
3. Orders from
multiple Municipal services customers
totaling Rs.2370.000 millions.
4. An order from
Prakash Industries for a material handling project for Rs.602.400 millions.
5. An order from
Bharat Coal and Chemicals for relocation of Ammonia and Coal Gasification plant
Rs.2379.900 millions.
6. An order
Suryadev Alloys and Power P Limited For 80MW Captive Power Plant for
Rs.3540.000 millions.
7. An order GMR
Chhattisgarh Energy Private Limited Bangalore for Water Intake package for 2 x
685 MW Thermal Power Plant for Rs.646.200 millions.
The Company's
Joint venture, Hamon Shriram Cottrel Limited Order has a backlog as of 31 March
2011 of 454 millions.
The Company's
other Joint Venture, Leitner Shriram Manufacturing Limited has a back log as of
31 March 2011 of Rs.10540.000 millions.
The Company's
associate, Orient Green Power Company Limited (OGPL) raised money by way of IPO
in September 2010 for Rs.9000.000 millions to finance expansion of its
business.
BUSINESS OVERVIEW
The Company
operates in two main segments; turnkey contracts and wind turbines. A brief
review of the business in these segments is given below.
The turnkey
contracts segment represents the Company's engineering, procurement and
construction projects business, which include renewable energy projects like
biomass-based power plants, metallurgical and process plant projects and
municipal services projects like water and wastewater treatment plants, water
and sewer infrastructure and pipe rehabilitation.
The Standalone
order book was Rs.31913.000 millions (approx) on March 31, 2011 and the
Consolidated Order Book was Rs.54852.000 millions (approx) on the same date.
The Board of
Directors have recommended a dividend
of Rs.1.20 per share. This translates into a payout of Rs.61.900 millions
including an amount of Rs.8.800 millions as Dividend Distribution Tax.
Overall revenues
from turnkey contracts was Rs.9417.200 millions in FY 2011. The Company's wind
turbine business comprises of sale and services of 250 KW class wind turbine generators
to clients.
The wind turbine
business revenue was Rs.695.700 millions in FY 2010 as compared to Rs.1926.100
millions in FY 2011. The order book for the turnkey contracts as on March 31,
2011 is Rs.29746.500 millions.
SUBSIDIARY COMPANIES AND JOINT VENTURES
SUBSIDIARIES
SHRIRAM EPC (SINGAPORE) PTE. LIMITED
Shriram EPC
(Singapore) Pte Limited is a 100% subsidiary of the company.
BLACK STONE GROUP TECHNOLOGIES PRIVATE LIMITED
(BGT)
BGT which had been
set up as an engineering outsourcing outfit in Chennai in 1993 acts as
Engineering outfit of the Group with 200 strong technical staff.
The Company holds
55% in the equity stake of BGT.
BGT along with its
subsidiary has reported a consolidated turnover of Rs.121.300 millions in the
year 2010-11 compared to Rs.92.800 millions in the previous year 2009-10. The
Company has identified newer business opportunities to increase its presence.
JOINT VENTURES
HAMON SHRIRAM COTTRELL PRIVATE LIMITED (HSC)
The Company's
joint venture Company, HSC in the field of heat exchangers, cooling towers and
air pollution control systems have reported significant growth. The turnover of
the Company has increased from Rs.1105.600 millions in 2009-10 to Rs.1580.000
millions for 2010-11. The profit before tax was Rs.105.000 millions for 2010-11
as compared to Rs.117.500 millions for 2009-10.
The major milestones achieved by the Company during
the year:
·
Major contracts worth Rs.3000.000 millions from
Reliance Infra (Sasan UMPP, Samalkot Gas Based and Krishnapatnam UMPP), World's
largest FRP Cooling Towers.
·
First Natural Draft Cooling Tower with Lanco
Infratech for Koradi 3 x 660MW.
·
First break through order with Hindalco for Aditya
Aluminium 6 x 150MW with civil for Rs.500.000 millions.
·
Successful performance testing of ESP for JSPL,
Barbil with emission of less than
·
30mg/m3.
·
In order to reflect the joint venture status of
HSC, the Company is consolidating HSC on a line by line basis as a JV and not
as a subsidiary.
LEITNER SHRIRAM MANUFACTURING LIMITED (LSML)
LSML set up an art
of facility at Gummidipoondi for the manufacture of wind turbines and the trial
production commenced in March 2009, and this year they have had a full year of
operation.
MAJOR ACHIEVEMENTS DURING THE YEAR
·
Manufactured and Dispatched 100 sets of Active
Parts
·
LSML awarded Star Export House status
·
Construction of substations at Koodangulam (50MW) and Gujarat (25MW)
·
Setting up of blade manufacturing facility
·
Prototype for LTW 80 1.8 MW WEG and 250KW H50
·
Installation of 1.5MW WEG in Thailand - First WEG
outside India
The Company's
order book position from various clients like PPS Enviro, TVH, Power Gen Lanka
and OGPL is approx Rs.10540.000 millions.
During the year,
LSML has reported a turnover of Rs.5460.000 millions as compared to Rs.3673.500
millions during the year 2009-10 with a profit of Rs.20.000 millions as
compared to a loss of Rs.35.000 millions during the year 2009-10.
ASSOCIATES
HALDIA COKE AND CHEMICALS PRIVATE LIMITED (HCCL)
During the year
the Company sold its entire investments in Ennore Coke Limited to HCCL. The
Company has a 48.48% equity stake in Haldia Coke and Chemicals Private Limited,
which in turn holds 60.86% equity stake in Ennore Coke Limited During the year,
HCCL has reported a consolidated turnover of Rs.8547.600 millions with a profit
after tax of Rs.209.200 millions.
SHRIRAM SEPL COMPOSITES LIMITED (SSEPL)
SSEPL is a joint venture
for manufacture of specialised GRP pipes and liners. SSEPL has had a mediocre
year in terms of turnover due to the new manufacturing set-up near Chennai,
which got operational only by the 3rd quarter of the current financial year.
MANAGEMENT DISCUSSION
AND ANALYSIS: FY 2010 – 11
COMPANY OVERVIEW
Subject is a
service provider of integrated design, engineering, procurement, construction,
and project management services geared towards the development of renewable
energy projects, process and metallurgy and municipal service projects
throughout India. The Company’s business centers around providing integrated
turnkey solutions for process and metallurgy plants (including thermal power
plants), biomass based power plants, water and waste- water treatment plants,
water and sewer infrastructure and pipe rehabilitation.
Through its
Subsidiaries and Associates the Company also manufactures / produces
·
Wind Turbine Generators (“WTG”) of multiple
capacities.
·
Cooling Towers and Air Pollution Control Systems.
·
GRP pipes and liners.
SEPC also holds interests in the following:
·
56.07% (direct and indirect) stake in Orient Green
Power Company Limited – Owner and Operator of Renewable Energy Power Generation
Projects.
·
48.48% stake in Haldia Coke and Chemicals Limited -
Manufacturer and marketer of Coking Coal products, including Met Coke.
·
55% in Blackstone Group Technologies Private
Limited, a Design and Engineering Firm.
SEPC is
headquartered in Chennai, Tamil Nadu and has offices in Mumbai, New Delhi, Kolkata,
Beijing and Rotterdam. It has factories in Puducherry and Chennai,
THE MACRO-ECONOMIC SCENARIO
The fiscal year
2010-11 began on an encouraging note, as developed economies picked up and displayed
signs of growth. The global economy begins to normalize post crisis as recovery
efforts have resulted in turnaround in the face of adverse circumstances.
According to Yale University Economists, Asia accounts for a greater share of
global revenue and financial clout. Emerging economies have shown tremendous
promise and have demonstrated steady performance at higher growth rates. While
haziness around unemployment and political polarization have left many
concerned about the outlook in developed economies in the West, emerging
economies have responded well to government intervention and policy.
However,
unseasonal weather patterns have led to global food shortages contributing to
diminished supply and fast-rising food prices, which coupled with rising demand
and speculation, have placed global food security in a precarious position.
Already, they have seen the effects of high inflation and political unrest in
Middle Eastern and North African countries such as Tunisia, Egypt, and Libya.
In the United States and other Western developed economies, relatively high
unemployment levels continue to remain as a critical issue. Financial Markets
have continued to fluctuate around global crises and the outlook remains
uncertain for the time being.
Regarding the
Indian economic outlook, the World Bank’s Development Prospects Group stated
that India’s growth will benefit from re-firming of external demand due to the
slow resumption of growth in advanced economies, representing over two-thirds
of India’s export markets. Although worries of high inflation persist,
Government policy initiatives provide some degree of comfort for lower levels
of inflation in the future. Furthermore, the overall business confidence of
managers of domestic and international Companies has continued to increase as
the ease of doing business in India increases.
Yet despite all
the challenges to growth in the global economy, International Monetary Fund
analysts expect global output to expand by 4.5% in 2011, reflecting
stronger-than-expected economic activity on the back of better performance in
the second half of 2010 and policy initiatives by the Government of the United
States. Growth in emerging markets, says the IMF remains robust buoyed by
strong private consumer demand, accommodative policy positions, and resurgent
capital inflows. They expect India will grow at 8.2% in the coming fiscal year.
The short-term outlook for Asia continues to look positive, with growth
expected to settle at sustained levels and remain particularly strong in demand
driven economies like India.
All in all, India
has come out a leader in the recovery post the global economic crisis,
positioning the country to enjoy the benefits of low-cost production and high
profitability going forward.
INDUSTRY STRUCTURE AND DEVELOPMENTS
INDEX OF INDUSTRIAL PRODUCTION
India’s industrial
sector contributes significantly to GDP and industrial trends have had an
overarching effect on the progress of the domestic economy. According to the
Economic Survey, the IIP grew by 9.5% as opposed to 7.4% in the previous
corresponding year.
Manufacturing
demonstrated robust performance throughout the year, growing upwards to 12.7%
and 9.7% respectively during the first two quarters of the current fiscal year
(Source: Economic Survey Chapter 1 p.11).
By early January,
India’s core infrastructure industries regained robust growth at 7.1%,
strengthening perceptions of overall outlook. Output for the six key industries
– crude, oil, electricity, petroleum refining, steel, cement, and coal – grew
in the period. The industries currently have a combined weight of close to
26.7% in the IIP. During the period from April 2010 to January 2011, the six
core industries registered a growth of 5.6 % (provisional) against 5.5 % during
the corresponding period of the previous year. Crude Oil and Finished Steel
grew significantly at 11.9% and 5.7% respectively.
CEMENT AND STEEL
India continues to
rank among the world’s top producers of Cement, ranking second only after
China. Total Cement production for the first half of the fiscal year reach
81.54 MT as compared to 77.22 MT in the same period in the corresponding year,
according to an IBEF Report. An additional capacity of 92.3 MT is expected to
be added to the sector by 2013.
According to the
“Indian Cement Industry Forecast to 2012” released by RNCOS, the cement
industry is projected to increase at a CAGR of 10.5% from FY2011-2014 on the
back of massive infrastructure projects and increased demand from manufacturers
to increase production capacities.
India was ranked
the fourth largest producer of crude steel in the world in 2010, and the
country has been the world’s largest sponge iron producer since 2002, according
to the Economic Survey. Production of domestic crude steel has grown by a CAGR of
8.4% from 2006-07 to 2009-10 largely on the back of expansion in capacity and
higher utilization rates as India’s industrial sector develops. The Minister of
State for Steel said in late February that with a targeted production of around
120 MT by 2012, India is set to become the second largest steel producing
country.
The steel industry
has continued to diversify its product mix and has delivered sophisticated
value-added steel in several sectors, particularly for automobiles, heavy
machinery, and physical infrastructure. The steel industry continues to suffer
from supply side issues in metallurgical coal which have been exacerbated by
the flooding in Queensland, Australia. Raw material security has thus become an
important issue and has emerged as a significant bottleneck against capacity
expansion.
INFRASTRUCTURE
With a vision
towards creating sustainable and robust economic growth, the Government of
India has focused on enhancing infrastructure around the country, particularly
for transportation and urban development. As the country consolidates its
position as one of the fastest growing economies across the globe, a high class
infrastructure which facilitates greater efficiency for businesses is
imperative.
With India aiming
to allocate over USD 1 trillion into infrastructure, half of which will come
from the private sector, the outlook for the sector looks bright and the
potential looks strong.
GLOBAL SCENARIO
Currently, the
total capacity of wind power globally comes to around 157,889 MW, of which
Europe accounts for around 48%. Over the last decade, the utilization of wind
power has more than quadrupled, with 81% of installations in the U.S. and in
Europe. China is another established leader in wind power, with wind power
accounting for over 41.8 GW of electricity generating capacity.
According to the
Global Wind Energy Council, the market growth of wind energy is driven by
several key factors, including the gap between supply and demand for energy,
rising importance of environmental issues, and technological advances for
capturing more wind movement. Global security of supply and economic
/environmental considerations demand the Government’s immediate attention in
wind energy.
As modern wind
turbines continue to improve in their power rating, reliability, and
efficiency, the demand to utilize wind energy has significantly increased. The
Global Wind Energy Council stated that over the past ten years, wind energy has
grown at a cumulative average of 30% with over 120 GW of power generated solely
from wind. This capacity of power will put a cap on carbon dioxide and decrease
carbon emissions into the upper atmosphere.
INDIAN SCENARIO
Today, India is
emerging as one of the world’s producers of wind turbines for Asia. By the end
of 2010, India had installed wind generation capacity of 13,065 MW with a
growth rate of 16% meeting 3% of the overall energy demand in the country,
which had a robust year in terms of adding new capacity and wind energy
installations, with 2,139 MW of added capacity. Currently, global institutes,
various industry associations, and the World Institute for Sustainable Energy
cite the wind energy potential in India at 65-100 GW.
Having utilized
only 13,065 MW thus far, the prospect of developing facilities in wind energy
is boundless.
The global wind
energy industry was significantly affected by the adverse impacts of the global
recession. The Indian annual wind power market, however, was reasonably well
insulated.
The Ministry of
New and Renewable Energy, in December 2009, offered new incentive schemes for
businesses aiming to enter the renewable energy space. The Generation Based
Incentive (GBI) offers an incentive tariff of Rs.0.50/kWh for eligible projects
for a period of ten years, valid for wind farms established before March 2012.
In addition, 18 of the 25 State Electricity Regulatory Commissions (SERCs) have
currently issued feed in tariffs for wind power. According to the GWEC, 17 of
these commissions have mandated state- wide Renewable Purchase Obligations
(RPOs), which has won investor confidence. Other policy measures have included
concessional import duties on specified wind turbine parts, excise duty
reliefs, and income tax holidays applicable to wind energy projects.
OUTLOOK
Their vision is to
continue to generate strong financial returns and create a world-class
Engineering, Procurement and Construction Company. The Company has a focus on
renewable energy and also strives to be a developer and manufacturer of
technologically advanced WTGs. SEPC continues to enhance its service offerings
through technology tie ups with leading global institutions such as Envirotherm
of Germany, NWEPDI of China and Roberts and Schaefer of USA. They will continue
to pursue opportunities by expanding and enhancing their presence throughout
India and abroad. They will look to capitalize on their strengths, local
experience and familiarity with local working conditions and ever strengthening
relationships with their clients and strategic partners in order to establish and
maintain a leading position in the industry. They further intend to target
specific project segments and industries where they believe there is high
potential for growth and can enjoy competitive advantages. Given the businesses
they are in, the conducive operating environment, their competencies, skills
and growth plans, they remain fairly confident of achieving sustained growth in
the future.
CONTINGENT
LIABILITIES:
|
Particulars |
31.03.2011 (Rs. in millions) |
31.03.2010 (Rs. in millions) |
|
Letters of Guarantee issued by the Banks |
2221.983 |
2545.850 |
|
Letters of Credit issued by the Banks |
2018.170 |
4904.967 |
|
Bills discounted |
2271.000 |
0.000 |
|
Corporate Guarantees issued |
340.000 |
950.000 |
|
Claims against
the Company not acknowledged as debts |
90.580 |
120.511 |
|
Disputed Income
Tax demands contested in Appeals not provided for Civil Cases. * * Management is of the opinion that the Appeals preferred by the
Company will be decided in its favour. |
105.286 |
98.274 |
|
Assessment year
Appeal pending before 2000-01 Appellate Tribunal |
4.808 |
5.594 |
|
2001-02 Appellate Tribunal |
0.000 |
2.159 |
|
2002-03 Appellate Tribunal |
4.915 |
5.190 |
|
2003-04 Appellate Tribunal |
155.533 |
16.325 |
|
2004-05 Commissioner of Income Tax (Appeals) |
2.624 |
3.058 |
|
2005-06 Commissioner of Income Tax (Appeals) |
29.848 |
34.053 |
|
2006-07 Commissioner of Income Tax (Appeals) |
21.968 |
31.895 |
|
2007-08 Commissioner of Income Tax (Appeals) |
19.224 |
0.000 |
|
2008-09 Commissioner of Income Tax (Appeals) |
6.356 |
0.000 |
|
Total |
7292.295 |
8717.876 |
AUDITED
FINANCIAL RESULTS FOR THE QUARTER YEAR ENDED 31.03.2012
|
Particulars |
31.03.2012 |
31.12.2011 |
31.03.2012 |
|
|
Quarter Ended (Audited) |
Quarter Ended (Unaudited) |
Year Ended (Audited) |
|
a) Net Sales/Income from Operations |
6034.332 |
2619.700 |
13750.722 |
|
b) Other operating Income |
3.291 |
13.915 |
71.281 |
|
Total Income
from Operations |
6037.623 |
2633.622 |
13822.003 |
|
Expenses |
|
|
|
|
a) Election, Construction and Operation Expenses |
4200.893 |
2603.418 |
12349.195 |
|
b) Purchase of Stock in Trade |
622.523 |
73.831 |
696.354 |
|
c) Change in Inventories of finished goods and work in progress |
487.644 |
(490.263) |
(1153.507) |
|
d) Employees benefits Expenses |
32.986 |
58.484 |
196.945 |
|
e) Depreciation and amortisation Expenses |
30.263 |
28.778 |
121.532 |
|
f) Other expenditure |
288.809 |
63.413 |
476.011 |
|
Total Expenses |
5663.118 |
2337.661 |
12686.530 |
|
|
|
|
|
|
Profit from Operations before Other Income, Interest and Exceptional
items (1-2) |
374.505 |
295.961 |
1135.473 |
|
Other Income |
78.377 |
24.326 |
256.856 |
|
Profit / (Loss)
from Ordinary Activities before Finance Costs |
|
|
|
|
& Exceptional
Hems (3+4) |
452.882 |
320.287 |
1392.329 |
|
Finance Costs |
377.931 |
217.881 |
1000.998 |
|
Profit before
Exceptional Items (5-6) |
74.951 |
102.406 |
391.331 |
|
Exceptional Items - Profit on Sale of investments |
-- |
-- |
-- |
|
Profit from
Ordinary activities before tax (7+8) |
74.951 |
102.406 |
391.331 |
|
Provision for Tax Expenses |
29.828 |
34.227 |
136.257 |
|
Net Profit After
Tax (9-10) |
45.123 |
68.179 |
255.074 |
|
Extraordinary items (net of Tax) |
-- |
-- |
-- |
|
Net Profit and
Loss Period (11-12) |
45.123 |
68.179 |
255.074 |
|
Share of Profit /(Loss) of Associates |
-- |
-- |
-- |
|
Minority Interest |
-- |
-- |
-- |
|
Net profit /(loss)
after taxes, minority Interest and Share of Profit/loss |
-- |
-- |
-- |
|
Paid-Up Equity Share Capital |
-- |
|
|
|
(Face Value of Rs.10/- each) |
|
|
|
|
Reserves excluding Revaluation Reserve as per Balance Sheet of previous
Accounting Year |
-- |
|
|
|
Earning Per Share (EPS) (not annualised) |
-- |
|
|
|
i) Basic (Rs) |
1.02 |
1.54 |
5.75 |
|
ii) Diluted (Rs) |
1.02 |
1.54 |
5.75 |
|
Particulars of
share holdings |
|
|
|
|
- Number of shares * |
26898211 |
26876166 |
26898211 |
|
- Percentage of
shareholding |
60.66 |
60.61 |
60.66 |
|
Promoters and
Promoter Group shareholding |
|
|
|
|
a) Pledged/ Encumbered |
|
|
|
|
- Number of shares |
2511080 |
4995580 |
2511080 |
|
- Percentage of share (as %
of the total shareholding of Promoter group) |
14.39 |
28.61 |
14.39 |
|
- Percentage of share (as
% of the total share capital of the Company) |
5.66 |
11.27 |
5.66 |
|
b)
Non-Encumbered |
|
|
|
|
- Number of shares |
14934993 |
12466538 |
14934993 |
|
- Percentage of share (as
% of the total shareholding of Promoter group) |
85.61 |
71.39 |
85.61 |
|
- Percentage of share (as
% of the total share capital of the Company) |
33.68 |
28.12 |
33.68 |
NOTE:
1. The standalone and consolidated results for Quarter / year ended March 31,2012 were reviewed and recommended by the Audit Committee and approved by the Board of Directors at their respective meetings held on May 30,2012.
2. The Company had executed an EPC contract for Sree Jayajothi Cements Limited and had total receivables of 73047.261 millions (Net of Cheques in Transit of 73016.400 millions) as of March 31, 2012, which have been outstanding for a considerable period of time in addition to investment of 150.000 millions in Equity Shares. The Company had received Shareholders' approval through postal ballot in March 2012 for conversion of part of the receivables into Equity. The Company has completed the conversion as envisaged in the Shareholders' approval during April 2012. This matter has been referred to in the Auditors' Report.
3. Though the Company had obtained its Shareholders' approval through Postal Ballot on 21stAugust, 2008, for transfer of 250 KW Wind Turbine Business to its Joint Venture, Leitner Shriram Manufacturing Limited (LSML) with effect from 1stApril,2008, the Company would continue to sell the 250 KW Wind Turbines till the time LSM Lobtains all statutory approvals to manufacture and sell the same. Consequently, the Company has not recognised the Loss / Profit in the standalone results for the Quarter and Year ended March 31, 2012.
4. The Company operates in three segments i.e. Contracts, Windmill and Trading.
5. Under ESOP Schemes 2006 and 2007, 81,885 options were exercised and shares allotted to the eligible employees during the year ended March 31, 2012.
6. During the first quarter of the previous year, the company had sold its entire investment in Ennore Coke Ltd. to Haldia Coke and Chemicals Private Limited (HCCL). The profit on this sale (Rs.7233.628 millions)is disclosed as an exceptional item.
7. During the year the Company has made the following investments
|
Particulars |
Relationship |
Amount |
|
Hamon Shriram Cottrell Private Limited |
Jointly Controlled Entity |
20.000 |
|
Leitner Shriram Manufacturing Limited |
Jointly Controlled Entity |
1.34.919 |
|
Shriram SEPL Composites Private Limited |
Associate |
67.500 |
8. The Consolidated Financial Results have been prepared in accordance with Accounting Standard -21 on Consolidated Financial Statements and Accounting Standard 23 on "Accounting for Investments in Associates" and Accounting Standard 27 on "Accounting for Jointly Controlled Entities" notified by Central Government of India under Companies (Accounting Standards) Rules 2006.
9. The Board of Directors have recommended a dividend of? 1.20 per share on face value of 10 per share for the financial year 2011-12, subject to shareholders' approval at the ensuing Annual General Meeting.
10. The Consolidated Financial Results includes the share of profit of an associate which is based on unaudited management accounts.
11. Figures for the quarter ended March 31,2012 are the balancing figure between audited figures for the full financial year and the year to date figures up to the third quarter of the current financial year after regrouping.
12. The figures
of the earlier periods have been regrouped to be in conformity with the new
format prescribed, under Clause 41 of the Listing Agreement.
Segment Reporting
under Clause 41 of the Listing Agreement with Stock Exchange for the Year ended
March 31, 2012.
|
|
31.03.2012 |
31.12.2011 |
31.03.2012 |
|
|
Quarter Ended (Audited) |
Quarter Ended (Unaudited) |
Year Ended (Audited) |
|
Segment Revenue (Net Sales/Income
from each Segment Gross of Excise) |
|
|
|
|
a) Contracts |
5537.870 |
2139.898 |
12606.069 |
|
b) Windmill |
498.289 |
411.266 |
1132.012 |
|
c) Trading |
1.464 |
82.458 |
83.922 |
|
Sub-total |
6037.623 |
2633.622 |
13822.003 |
|
Less : Inter segment revenue |
-- |
-- |
-- |
|
Net Sales / Income
From Operations |
6037.623 |
2633.622 |
13822.003 |
|
2. Segment Results |
|
|
|
|
(Profit and Loss before tax and interest from each segment) |
|
|
|
|
a) Contracts |
778.675 |
429.354 |
1979.667 |
|
b) Windmill |
(50.803) |
8.655 |
(56.996) |
|
c) Trading |
(1.337) |
8.627 |
7.290 |
|
Total |
726.535 |
446.636 |
1929.961 |
|
a) Interest income net off expense |
377.931 |
217.881 |
1000.998 |
|
b) Other un-allocable income net off un-allocable
expenditure |
273.653 |
126.349 |
537.632 |
|
Total Profit Before Tax |
74.951 |
102.406 |
391.331 |
|
3. Capital employed |
|
|
|
|
(Segment assets – Segment Liabilities) |
|
|
|
|
a) Contracts |
2304.278 |
188.623 |
2304.278 |
|
b) Windmill |
796.321 |
452.705 |
796.321 |
|
c) Trading |
122.198 |
1230.062 |
122.198 |
|
Unallocated assets less Unallocated Liabilities |
1852.080 |
3220.051 |
1852.080 |
|
Total Employed |
5074.877 |
5091.441 |
5074.877 |
STATEMENT OF ASSETS AND LIABILITIES
|
S. N. |
Particulars
|
31.03.2012 |
|
|
Standalone |
|||
|
Audited Standalone for the year ended |
|||
|
|
|
|
|
|
A |
EQUITY AND LIABILITIES |
|
|
|
1 |
Shareholders’ Funds |
|
|
|
|
a) |
Share Capital |
443.443 |
|
|
b) |
Reserves & Surplus |
4631.434 |
|
|
Sub-total- Shareholders' funds |
5074.877 |
|
|
4 |
Non- Current Liabilities |
|
|
|
|
a) |
Long-term borrowings |
293.392 |
|
|
b) |
Deferred Tax-liabilities (net) |
307.333 |
|
|
c) |
Other long-term liabilities |
1.339 |
|
|
d) |
Long-term provisions |
17.423 |
|
|
Sub-total-Non-current liabilities |
619.487 |
|
|
5 |
Current liabilities |
|
|
|
|
a) |
Short-term borrowings |
17615.580 |
|
|
b) |
Trade payables |
5327.083 |
|
|
c) |
Other current liabilities |
3931.996 |
|
|
d) |
Short-term provisions |
74.908 |
|
|
Sub-total-current liabilities |
26949.567 |
|
|
|
|
|
|
|
|
TOTAL-EQUITY AND LIABILITIES |
32643.931 |
|
|
B |
ASSETS |
|
|
|
3. |
Non-current assets |
|
|
|
|
a) |
Fixed assets |
1262.515 |
|
|
|
Goodwill on consolidation |
-- |
|
|
b) |
Non-current investments |
2898.159 |
|
|
|
Differed tax Assets |
-- |
|
|
c) |
Long-term loans and advances |
179.511 |
|
|
d) |
Other non-current assets |
926.120 |
|
|
Sub-total-Non-current assets |
5266.305 |
|
|
4. |
Current Assets |
|
|
|
|
a) |
Current investments |
-- |
|
|
b) |
Inventories |
2780.204 |
|
|
c) |
Trade receivables |
12325.957 |
|
|
d) |
Cash and cash equivalents |
3628.000 |
|
|
e) |
Short-term loans and advances |
4415.889 |
|
|
f) |
Other current assets |
4227.576 |
|
|
Sub-total-current
assets |
27377.626 |
|
|
|
TOTAL-ASSETS |
32643.931 |
|
FIXED ASSETS
Tangible Assets
·
·
Buildings
·
Leasehold Improvements
·
Plant and Machinery
·
Furniture and Fittings
·
Office Equipment
·
Computers and Software
·
Vehicles
Intangible Assets
·
Technical know-how
·
ERP Software
·
Leasehold land right to use
PRESS RELEASES:
SEPC WINS KERALA
WATER BODY ORDER
Special Correspondent
CHENNAI: Subject (SEPC) a provider of integrated design, engineering, procurement, construction and project management services has been awarded two contracts by the Kerala Water Authority for creating a water distribution network for the city of Kozhikode and its adjoining villages.
The Rs.1650.000 millions-order involves supplying and laying bf pipes totalling more than 1,000 km in length.
T. Shivaraman, Managing Director and Chief Executive Officer of Shriram EPC, said in a release that the company's diversified business model had helped it carry a fairly strong order book, which stood at Rs.31940.000 millions The prospects for the businesses catering to water and wastewater management and distribution systems and municipal services remained healthy; the release quoted him as further saying.
Shriram dreams big for its nonfinancial business, engineers’ new
ownership structure
V Balasubramanian and Sanjay Vijayakumar, ET Bureau May 2, 2012, 01.48PM IST
CHENNAI: The Chennai-based Shriram group, known primarily for its strengths in the financial services space, is all set to give a big push to its non-finance businesses, whose growth it had to curtail more than a decade back because of regulatory concerns.
To start with, Shriram's non-finance businesses - represented by about 10 companies that make everything from flexible packaging materials to guitars, and from supply chain management solutions to buildings – will come under a new ownership and management Trust. Together, these companies generate about Rs 40000.000 millions in revenues per year.
“The non-financial services should grow like the financial services business," said R Thyagarajan, founder chairman of the group.
After almost four decades of operations, Shriram's financial services businesses manage assets of over Rs 40000.000 millions and services 6.5 million clients. They operate in areas such as truck finance, SME finance, insurance, broking and chit funds. More significantly, they have attracted a slew of top-notch private equity players.
"The focus will be on EPC (the group's interests are in Shriram EPC), IT (Take Solutions) and properties (Shriram Properties)," said HR Srinivasan, Vice Chairman and Vision Holder, Take Solutions. For example, he said, "the technology business is Rs 700-800 crore in size and they could take it to Rs 40000.000 millions -50000.000 millions in the next five years. The EPC business is now Rs 14000.000 millions they can take it to Rs 150000.000-200000.000 millions."
Shriram Properties MD M Murali said he sees a huge scale-up in the coming years. In the last 12 years, he said, the company has delivered 7 million sq ft. In the next two-and-a-half years, it is targeting 9 million sq ft.
The new non-finance business Trust, named the Shriram Enterprises Trust, is a consequence of the Shriram Ownership Trust, set up in 2006 to recognise as owners all the top officials who built the numerous financial businesses of the group.
The Trust structure is handy in that more partners can be added at a later date and it is also free from tax and regulatory issues. Group director S Natarajan, the architect of this uncommon ownership model, said that there are 36 members in the Shriram Ownership Trust. Each is in the level of an MD, CEO, ED or President. While the senior-most members have been given a 2.5% stake, the others have a 1% stake.
The total comes to 55%. Until they retire at the age of 60, the Trust doesn't yield them anything. They just have to draw remuneration from their respective companies. Once they turn 60, they immediately get a 20% return on what they are eligible for. The remaining flows to them over eight years.
That still left 45% of the Trust stake unallocated. It was therefore decided to allocate 20% for future leaders. It was the remaining 25% that was transferred to Shriram Enterprises Trust. In this, the top brass of Shriram's non-finance businesses are eligible to join.
The group has also separated both Trusts, so that those in the ownership Trust can stay unaffected from the fortunes of the enterprise Trust if they want to. That's because the nature of business and therefore the risk is different. However, those such as Thyagarajan and Natarajan have opted to be part of the enterprise Trust as well.
Also, the group is in the process of creating a holding company for the non-finance business, much in the same vein Shriram Capital for its finance businesses.
Srinivasan said, "The non-financial services business is not new to the group. What is new is the orientation they are giving now." He said the idea is to build them as entrepreneurial initiatives. "They will provide the required capital and management bandwidth to support their growth, as they want to push them to the next orbit."
It was in the early '90s, nearly two decades after starting out, that the Shriram group decided to foray into the industrial sector. Thyagarajan had two reasons for such a foray. One, even if the financial services were generating a return of 19%, shareholder value was being eroded because of high inflation of 12%. So, a cushion was needed. Two, assets in the industrial sector usually create value in 7-8 years.
So, "They set apart 10-15% of the resources, including deposits, to set up industrial ventures," said Thyagarajan. "It did not involve risk for the finance companies as they had only given loan to the ventures with the equity coming from promoters."
But many of the non-business forays didn't last long. "The diversification was strongly disapproved by the RBI, as they thought they are siphoning off money. They were under tremendous pressure to move out of the businesses."
The group eventually had to exit businesses such as Sembawang Shriram Integrated Logistics, Hi Tech Arai and Medicorp Technologies between 1999 and 2001.
The group, however, managed to retain interest in some small businesses such as Victory Laminations (into flexible packaging materials) and Rambal (auto parts). Also retained were a cooling tower business and an engineering services business, which were merged to form Shriram EPC in 2005. It is led by Thyagarajan's son T Shivaraman.
Shriram Properties was started in 1995. Take Solutions was started in 2000. Both property and EPC businesses have attracted PE interest. Shriram Properties has investments by TPG, Walton Street Capital and Starwood while Shriram EPC has investments by ChrysCapital, UTI Ventures and Bessemer.
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist organization
or whom notice had been received that all financial transactions involving
their assets have been blocked or convicted, found guilty or against whom a
judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on Corporate
Governance to identify management and governance. These factors often have been
predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.55.70 |
|
|
1 |
Rs.86.28 |
|
Euro |
1 |
Rs.68.15 |
INFORMATION DETAILS
|
Report Prepared
by : |
DPK |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
6 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
8 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
6 |
|
--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 |
|
62 |
This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a
composite of weighted scores obtained from each of the major sections of this
report. The assessed factors and their relative weights (as indicated through
%) are as follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit transaction.
It has above average (strong) capability for payment of interest and
principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General unfavourable
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with full
security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
- |
NB |
New Business |
- |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.