MIRA
INFORM REPORT
|
Report Date : |
26.07.2012 |
IDENTIFICATION DETAILS
|
Name : |
ESSAR OIL LIMITED |
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Registered
Office : |
Khambhalia Post, Post Box No. 24, District |
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Country : |
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Financials (as
on) : |
31.03.2011 |
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Date of
Incorporation : |
12.09.1989 |
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Com. Reg. No.: |
04-032116 |
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Capital
Investment / Paid-up Capital : |
Rs.13656.700 Millions |
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CIN No.: [Company Identification
No.] |
L11100GJ1989PLC032116 |
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TAN No.: [Tax Deduction &
Collection Account No.] |
RKTE00150D |
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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
: |
Manufacturer and Exporter of Petrol, Diesel, Kerosene and Service Provider of thermal power generation. |
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No. of Employees
: |
1676 (Approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba (54) |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Maximum Credit Limit : |
USD 260000000 |
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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 Essar Group. It is a well established and a
reputed company having satisfactory track record. Financials company is performing
well. Trade relations are reported as fair. Business is active. Payments are
reported to be regular and as per commitments. The company can be considered normal for business dealings at usual
trade terms and conditions. |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – June 30, 2012
|
Country Name |
Previous Rating (31.03.2012) |
Current Rating (30.06.2012) |
|
India |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
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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 |
RBI DEFAILTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available RBI Defaulters’ list.
EPF (Employee Provident Fund) DEFAILTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter in
the publicly available EPF (Employee Provident Fund) Defaulters’ list as of
31-03-2012.
LOCATIONS
|
Registered
Office/ Factory 1 : |
Khambhalia Post,
Post Box No. 24, District |
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Tel. No.: |
91-2833-241444 |
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Fax No.: |
91-2833-662929 |
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E-Mail : |
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Website : |
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Corporate
Office : |
Essar House, P.
O. Box No. 7945, 11, Keshavrao Khadye Marg, Mahalaxmi, Mumbai – 400 034,
Maharashtra, India |
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Tel. No.: |
91-22-24950606/
66601100/ 50011100 |
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Fax No.: |
91-22-23544281/
23540450 |
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E-Mail : |
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Area : |
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Factory 2 : |
The company’s Oil
fields are located at Mehsana, |
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Regional
Office : |
Located at:
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Overseas
Office : |
Located at: |
DIRECTORS
As on 31.03.2011
|
Name : |
Mr. Shashi Ruia |
|
Designation : |
Chairman and
Promoter Director |
|
Brief: |
Mr. Shashi Ruia
is a first generation entrepreneur industrialist. With brother Ravi, Shashi
Ruia founded the Essar Group, which today is a multinational conglomerate with
operations in more than 20 countries, employing 70,000 people, and revenues
of US$15 billion. His career began in the family business in 1965 under the
guidance of his father, the late Nand Kishore Ruia. The Ruia brothers
pioneered sectors as diverse as shipping, marine construction, steel, power,
offshore engineering and refining & oil exploration. Shashi Ruia’s vision
saw the Essar Group gain a first mover advantage in many of these businesses. |
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Name : |
Mr. Prashant Ruia |
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Designation : |
Promoter Director |
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Brief: |
Chief Executive
of Essar Group Mr. Prashant Ruia is a prominent Indian industrialist. Mr. Prashant Ruia
has been involved with the Group’s operations and management since 1985 and is
a key member of Essar Group’s strategy think tank. He is actively involved in
the Group’s growth and diversification within India and internationally. He
is known for his project execution skills, financial expertise and people
management capabilities. |
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Name : |
Mr. Anshuman Ruia
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Designation : |
Promoter Director
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Brief: |
Mr Anshuman Ruia
is a board director of major companies in the Essar Group. He has over a
decade of experience in overseeing the Group’s major businesses. He currently
oversees Essar’s Shipping, Ports and Logistics, Telecom and BPO, and Power
businesses. He is responsible for the expansion and diversification of the
Power business into new, renewable energy sources and its entry into the
transmission and distribution segment. |
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Name : |
Mr. Naresh K.
Nayyar |
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Designation : |
Managing
Director and Chief Executive Officer |
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Brief: |
Mr. Naresh Nayyar
was appointed as Managing Director, of the Company on October 15, 2007. He is
a chartered accountant and an alumnus of the Indian Institute of Management,
Ahmedabad. He has more than 35 years’ experience in the oil and gas industry.
Prior to joining Essar Oil, Mr Nayyar was in ONGC Mittal Energy Limited where
he was instrumental in steering its growth through mergers and acquisitions.
Prior to that he served with Indian Oil Corporation. He held several key
assignments in planning and business strategy, finance, treasury and
international trade. |
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Name : |
Mr. P. Sampath |
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Designation : |
Director Finance |
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Brief: |
Mr. Sampath is
the Chief Financial Officer of Essar Energy Plc, UK. He joined Subject in
October, 2008 as its Chief Financial Officer, and joined the Board w.e
Limited. April 1, 2009 as Director - Finance. After taking over his present role,
he continues as non-Executive Director. He has a first class Bachelor of
Commerce degree from Madras University, is a Fellow of both the Institute of
Cost and Works Accountants of India and the Institute of Company Secretaries
of India. He has more than 30 years’ experience in various fields including
global corporate finance and treasury, mergers and acquisitions, corporate
business planning, investor relations, global HR strategy and financial and
management accounting. Prior to joining Essar Group, Mr. Sampath was Chief
Financial Officer for RPG Enterprises Limited and Managing Director of GHCL
Limited |
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Name : |
Mr. Dilip J.
Thakkar |
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Designation : |
Director and
Independent |
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Brief: |
Mr. Thakkar was appointed
to the board of directors on November 3, 1994. He is a Fellow of the
Institute of Chartered Accountants of India. He is a practicing chartered
accountant, with over 50 years’ experience in taxation and foreign exchange
regulations. He is associated with several public and private companies as a
director. |
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Name : |
Mr. K. N.
Venkatasubramanian |
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Designation : |
Director |
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Brief: |
Mr.
Venkatasubramanian was appointed to the board of directors on November 29, 2000.
He is a chemical engineer from A.C. College of Technology, Chennai and an
M.Tech from IIT, Kharagpur. He has over 50 years of experience in the
petrochemicals sector having worked for IPCL, IOCL and Gulf Oil Limited. He
has previously served as Director, Marketing and Director, Operations of
IPCL, Chairman and Managing Director of Engineers India Limited, Chairman and
Managing Director of IOC and as Chairman of Gulf Oil Limited He is currently
Chairman of Times Technoplast Limited |
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Name : |
Mr. K.V.
Krishnamurthy |
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Designation : |
Independent
Director |
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Brief: |
Mr. Krishnamurthy
was appointed to the board on January 22, 2010. He is a chartered accountant
and a fellow of the Indian Institute of Bankers, having previously served as a
member of its Governing Board. He has more than 33 years’ experience in
public sector banking. His expertise includes domestic and international
banking, treasury management, risk management, foreign exchange management
and human resource management. He is credited with the remarkable turnaround
of both Bank of India and Syndicate Bank, two leading nationalised banks. He
has been the chairman/director of nationalised banks including Bank of India,
Bank of Baroda, Syndicate Bank and other financial institutions including
Indo Hong Kong International Finance Company Ltd, Export Credit Guarantee
Corporation of India and Agricultural Finance Corporation of India Ltd. Mr.
Krishnamurthy is also a director on the board of various Indian public
limited companies. |
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|
Name : |
Mr. Melwyn Rego |
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Designation : |
Nominee of IDBI
Limited |
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Brief: |
Mr Melwyn Rego
was appointed to the board of directors on October 18, 2010. He joined IDBI
in February 1984. His assignments were in the areas of Rehabilitation Finance,
Project Finance and International Resources. He was deputed to Tata Home
Finance Limited in May 2003 when IDBI took over the company. The takeover was
effected in September 2003 and Melwyn Rego was appointed as Managing Director
and CEO of IDBI Homefinance Limited Mr. Rego continued as Managing Director
and CEO until December 2007 after which he returned to IDBI Bank Limited
(after its conversion to a commercial bank). He is currently Executive
Director at IDBI Bank Limited |
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Name : |
Mr. V. K. Sinha |
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Designation : |
Nominee of LIC of
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Brief: |
Mr. Sinha was
appointed to the board of directors on October 30, 2006. He holds a Bachelor
of Arts (Honours) degree. Prior to his retirement Mr. V.K. Sinha was the
zonal manager of the northern zone, Life Insurance Corporation of India (“LIC”) at New
Delhi where he headed the offices of LIC situated in 6 states: Delhi, Punjab,
Haryana, Rajasthan, Himachal Pradesh and Jammu & Kashmir. He previously
served as the Zonal Manager, north central zone, Kanpur for four years. He
started his career as a Direct Recruit Officer in 1977, and in a career
spanning more than 3 decades, he has held prominent positions as Sr.
Divisional Manager (in-charge) of Jamshedpur and Muzaffarpur for the LIC. |
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|
Name : |
Mr. Manju Jain |
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Designation : |
Nominee of IFCI
Limited |
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Brief: |
Mrs. Manju Jain
was appointed to the board of directors July 26, 2010. She is a chartered
accountant. She joined IFCI in 1995, as a Management Trainee, she has
subsequently worked in its credit department at head office, New Delhi and
Mumbai regional office. At present, she is Vice President in-charge of credit
at Head Office, Delhi. |
KEY EXECUTIVES
|
Name : |
Mr. Sheikh S
Shaffi |
|
Designation : |
Company Secretary
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MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 30.06.2012
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
|
(A) Shareholding
of Promoter and Promoter Group |
|
|
|
|
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|
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39,162,217 |
11.03 |
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|
39,162,217 |
11.03 |
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Bodies Corporate |
178,858,724 |
50.36 |
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Sub Total |
178,858,724 |
50.36 |
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Total
shareholding of Promoter and Promoter Group (A) |
218,020,941 |
15.96 |
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(B) Public
Shareholding |
|
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|
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|
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|
10,210,305 |
2.87 |
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|
11,328,132 |
3.19 |
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|
28,210,757 |
7.94 |
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49,749,194 |
14.01 |
|
|
|
|
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|
12,917,980 |
3.64 |
|
|
|
|
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66,710,276 |
18.78 |
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|
5,149,664 |
1.45 |
|
|
2,596,259 |
0.73 |
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|
2,596,259 |
0.73 |
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|
87,374,179 |
24.60 |
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Total Public
shareholding (B) |
137,123,373 |
38.61 |
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Total (A)+(B) |
355,144,314 |
100.00 |
|
(C) Shares held
by Custodians and against which Depository Receipts have been issued |
|
|
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1,010,522,772 |
-- |
|
|
-- |
-- |
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|
1,010,522,772 |
-- |
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Total
(A)+(B)+(C) |
1,365,667,086 |
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer and Exporter of Petrol, Diesel,
Kerosene and Service Provider of thermal power generation. |
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Products with ITC Code : |
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PRODUCTION STATUS (As on 31.03.2011)
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Licensed Capacity |
Not applicable since delicensed |
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Installed Capacity
(Million MT per annum) |
10.50 |
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Actual Throughput
(Million MT per annum) |
14.76 |
GENERAL INFORMATION
|
No. of Employees : |
1676 (Approximately) |
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Bankers : |
·
ICICI Bank Limited ·
State Bank of India ·
IDBI Bank Limited ·
Punjab National Bank ·
HDFC Bank Limited ·
Axis Bank Limited ·
Indian Overseas Bank ·
Oriental Bank of Commerce ·
Indian Bank ·
Central Bank of India ·
Bank of India ·
State Bank of Patiala ·
Allahabad Bank ·
Syndicate Bank ·
Bank of Baroda ·
State Bank of Mysore |
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Facilities : |
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Banking
Relations : |
-- |
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Auditors : |
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Name : |
Deloitte Haskins
and Sells Chartered Accountants |
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Address : |
Ahmadabad, Gujarat, India |
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Holding Companies: |
· Essar Global Limited - Caymen (Ultimate Holding Company) · Essar Energy Plc - U.K. (Holding Company of Vadinar Oil - Mauritius) · Vadinar Oil - Mauritius (Holding Company) |
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Associate: |
· Vadinar Power Company Limited (VPCL) |
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Fellow Subsidiaries: |
·
Aegis Limited (Merger of Essar Engineering
Services Limited ·
Aegis BPO Services (GURGAON) Limited with Aegis
Limited) (AEGIS) ·
Aegis Aspire Consultancy Services Limited (AACSL) ·
Bhandar Power Limited (BPOL) ·
Essar Bulk Terminal Limited (EBTL) ·
Essar Bulk Terminal (Salaya) Limited (EBTSL) ·
Essar Electrical Power Development Corporation
Limited (EEPDCL) ·
Essar Energy Overseas Limited (EEOL) ·
Essar Exploration and Production India Limited
(EEXPIL) ·
Essar Exploratio and Production Limited (EEXPL) ·
Essar Exploration and Production Southeast Asia
Limited (EEXPSEAL) ·
Essar Energy Holdings Limited - Mauritius (EEHL) ·
Essar Gujarat Petrochemicals Limited (EGPL) ·
Essar Logistics Limited (ELL) ·
Essar Offshore Subsea Limited (EOSL) ·
Essar Oilfield Services India ·
Limited (EOFSIL) ·
Essar Oilfield Services Limited (EOFSL) ·
Essar Oil UK Limited (EOLUK), Essar ·
Power Gujarat Limited (EPGL) ·
Essar Projects (India) Limited (EPIL) ·
Essar Project Management ·
Consultants Limited (EPMCL) ·
Essar Power Limited (EPOL) ·
Essar Steel Limited (Merger of Essar Steel Orissa
Limited ·
Essar Steel Hazira Limited ·
Hazira Pipe Mills Limited ·
Hazira Plates Limited ·
Essar SEZ Hazira Limited (ESHL-SEZ) ·
Essar Shipping and Logistics Limited (ESLL) ·
Essar Shipping Ports and Logistics Limited (ESL) ·
Vadinar Oil Terminal Limited (VOTL) ·
Vadinar Ports and Terminals Limited (VPTL). |
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Related Parties : |
· Arkay Holdings Limited (ARKAYHPL) · Asia Motor Works Limited (AMW) (Related Party upto March 31, 2010) · Essar Agrotech Limited (EATL) · Essar Energy Services Limited (EESL) · Essar Heavy Engineering Services Limited (EHESL) · Essar House Limited (EHL), Essar Investments Limited (EIL) · Essar Information Technology Limited (EITL) · Essar Infrastructure Services Limited (EISL) · Essar Properties Limited (EPL), Essar Steel (Jharkhand) Limited (ESTLR), Futura Travels Limited (FUTURA) · Ibrox Estates Private Limited (HILLPL) · India Securities Limited (ISL) · Kanak Communications Limited (KANAKCL) · Kartik Estates Private Limited (KEPL) · Neelkamal Traders Private Limited (NEELKAMAL) · New Ambi Trading and Investments Private Limited (NEWAMBITPL) · Paprika Media Limited · Sinter-Keramos and Composites Private Limited (SKCPL) · The Mobile Stores Limited (TMSL) ·
Teletech Investments (India) Ltd (TIL)
(Related party upto March 31,2010) ·
Vadinar Properties Limited (VPL) |
CAPITAL STRUCTURE
As on 31.03.2011
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
5000000000 |
Equity Shares |
Rs.10/- each |
Rs.50000.000 Millions |
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|
|
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Issued, Subscribed
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
1427593086 |
Equity Shares |
Rs.10/- each |
Rs.14275.930
millions |
|
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|
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|
Paid-up
Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
1365667086 |
Equity Shares |
Rs.10/- each |
Rs.13656.700
Millions |
|
61926000 |
Add: Forfeited shares |
Rs.10/- each |
Rs.166.000
Millions |
|
|
|
|
Rs.13822.700 millions |
Notes: - Of the above equity shares:
a) 65,370,000 (Previous year 65,370,000) equity shares were allotted as fully paid up equity shares pursuant to a contract for consideration other than cash during the financial year 1992-1993.
b) 1,010,522,772 (Previous year 846,385,290) equity shares are represented by 6,604,724 (Previous year 5,531,930) global depository shares (GDS).GDS issued during the year 1,072,794 (Previous year Nil) are represented by 164,137,482 (Previous year Nil) equity shares.
c) 4,761,000 Global Depository Shares (“GDSs”) represented by 728,433,000 (Previous year 4,761,000 GDSs represented by 728,433,000) underlying equity shares of Rs.10 each are held by Vadinar Oil, Mauritius, the holding Company pursuant to section 4(6) of the Companies Act, 1956.
d) 177,654,041 equity shares and 1,843,724 GDSs represented by underlying 282,089,772 equity shares (Previous year 74,729,437 equity shares and 770,930 GDSs represented by underlying 117,952,290 equity shares) of Rs.10 each are held by Essar Energy Holdings Ltd., Mauritius, subsidiary of the holding Company.
e) 100 (Previous year 100) equity shares of Rs.10 each are held by Hazira Steel 2, subsidiary of ultimate holding company, Essar Global Limited Cayman Islands.
f) Nil (Previous year 3,838,104) equity shares of Rs.10 each are held by Essar Shipping Ports & Logistics Limited, subsidiary of ultimate holding Company.
g) Nil (Previous year 211,000) equity shares of Rs.10 each are held by Essar Steel Limited, subsidiary of ultimate holding Company.
h) Teletech Investments India Limited was a subsidiary of ultimate holding Company during the previous year and held 100,080,083 equity shares of Rs.10 each as on March 31, 2010. During the year it has ceased to be subsidiary of the ultimate holding Company.
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
13822.700 |
12181.300 |
12181.300 |
|
|
2] Share Application Money |
0.000 |
0.000 |
910.300 |
|
|
3] Reserves & Surplus |
51556.300 |
28365.700 |
28075.600 |
|
|
4] (Accumulated Losses) |
0.0000 |
(5342.600) |
(5347.100) |
|
|
NETWORTH |
65379.000 |
35204.400 |
35820.100 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
122744.200 |
94705.900 |
94191.500 |
|
|
2] Unsecured Loans |
22725.100 |
8831.400 |
6125.600 |
|
|
TOTAL BORROWING |
145469.300 |
103537.300 |
100317.100 |
|
|
DEFERRED TAX LIABILITIES |
114.500 |
0.000 |
0.000 |
|
|
Advance towards issue of global depository shares |
0.000 |
11532.100 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
210962.800 |
155616.400 |
136137.200 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
117440.900 |
123093.500 |
126058.400 |
|
|
Capital work-in-progress |
84230.400 |
43187.500 |
19139.000 |
|
|
|
|
|
|
|
|
INVESTMENT |
1030.000 |
2030.000 |
1030.500 |
|
|
DEFERREX TAX ASSETS |
0.000 |
5.700 |
5.700 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
57491.400
|
39694.400 |
22509.300 |
|
|
Sundry Debtors |
23673.000
|
19574.200 |
11653.500 |
|
|
Cash & Bank Balances |
29586.600
|
13507.500 |
11746.300 |
|
|
Other Current Assets |
4978.400
|
4065.400 |
4199.200 |
|
|
Loans & Advances |
7378.800
|
7283.700 |
9122.700 |
|
Total
Current Assets |
123108.200
|
84125.200 |
59231.000 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
73616.900
|
84096.800 |
60331.900 |
|
|
Other Current Liabilities |
39260.000
|
17508.900 |
8742.100 |
|
|
Provisions |
1969.800
|
562.400 |
253.400 |
|
Total
Current Liabilities |
114846.700
|
102168.100 |
69327.400 |
|
|
Net Current Assets |
8261.500
|
(18042.900) |
(10096.400) |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
210962.800 |
155616.400 |
136137.200 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
469882.100 |
365046.100 |
375164.100 |
|
|
|
Other Income |
3540.000 |
8719.300 |
1837.400 |
|
|
|
TOTAL (A) |
473422.100 |
373765.400 |
377001.500 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Purchase of traded petroleum products |
19642.000 |
17057.400 |
6509.300 |
|
|
|
Consumption of raw materials |
421292.700 |
328559.800 |
325602.700 |
|
|
|
Increase)/Decrease in stock |
(11576.400) |
(3108.100) |
9917.500 |
|
|
|
Operating expenses |
7356.600 |
4135.200 |
3682.800 |
|
|
|
Employee costs |
1196.700 |
975.000 |
968.800 |
|
|
|
Selling and marketing expenses |
4091.400 |
3812.600 |
3547.700 |
|
|
|
General and administrative expenses |
3624.200 |
2955.300 |
14746.600 |
|
|
|
TOTAL (B) |
445627.200 |
354387.200 |
364975.400 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
27794.900 |
19378.200 |
12026.100 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
12202.400 |
11809.300 |
10914.800 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
15592.500 |
7568.900 |
1111.300 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
7308.600 |
7283.100 |
6548.500 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
8283.900 |
285.800 |
(5437.200) |
|
|
|
|
|
|
|
|
|
Less |
TAX (I) |
1745.100 |
(8.800) |
(302.100) |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-I) (J) |
6538.800 |
294.600 |
(5135.100) |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
(5565.100) |
(5569.600) |
(514.500) |
|
|
|
|
|
|
|
|
|
Add: |
Amount transferred
from foreign projects reserve |
0.000 |
4.500 |
80.000 |
|
|
|
|
|
|
|
|
|
Less: |
Amount transferred
to debenture redemption reserve |
603.300 |
294.600 |
0.000 |
|
|
|
|
|
|
|
|
|
|
BALANCE CARRIED
TO THE B/S |
370.400 |
(5565.100) |
(5569.600) |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Export Earnings |
155573.600 |
87695.100 |
109686.900 |
|
|
TOTAL EARNINGS |
155573.600 |
87695.100 |
109686.900 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
374753.900 |
337504.700 |
334484.300 |
|
|
|
Stores & Spares |
1508.100 |
790.000 |
1016.300 |
|
|
|
Capital Goods |
19509.200 |
3239.200 |
584.000 |
|
|
TOTAL IMPORTS |
395771.200 |
341533.900 |
336084.600 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
|
|
|
|
|
|
Basic |
4.85 |
0.25 |
(4.30) |
|
|
|
Diluted |
4.47 |
0.24 |
(4.30) |
|
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 |
150240.000 |
130260.000 |
129330.000 |
175430.000 |
|
Total Expenditure |
141580.000 |
128890.000 |
124510.00 |
172580.000 |
|
PBIDT (Excl OI) |
8660.000 |
1370.000 |
4820.000 |
2850.000 |
|
Other Income |
470.000 |
1220.000 |
80.000 |
1590.000 |
|
Operating Profit |
9130.000 |
2590.000 |
4900.000 |
4440.000 |
|
Interest |
2840.000 |
3170.000 |
3540.000 |
4550.000 |
|
Exceptional Items |
0.000 |
0.000 |
(40150.000) |
(2950.000) |
|
PBDT |
6290.000 |
(580.000) |
(38790.000) |
(3060.000) |
|
Depreciation |
1810.000 |
1830.000 |
1890.000 |
2090.000 |
|
Profit Before Tax |
4480.000 |
(2410.000) |
(40680.000) |
(5150.000) |
|
Tax |
(210.000) |
(750.000) |
(820.000) |
0.000 |
|
Profit After Tax |
4690.000 |
(1660.000) |
(39860.000) |
(5150.000) |
|
Net Profit |
4690.000 |
(1660.000) |
(39860.000) |
(5150.000) |
KEY RATIOS
|
PARTICULARS |
|
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
PAT / Total Income |
(%) |
1.38
|
0.08 |
(1.36) |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
1.76
|
0.08 |
(1.45) |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
3.44
|
0.14 |
(2.93) |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.13
|
0.01 |
(0.15) |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
3.98
|
5.84 |
4.74 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.07
|
0.82 |
0.85 |
LOCAL AGENCY FURTHER INFORMATION
|
Sr. No. |
Check List by Info Agents |
Available in
Report (Yes / No) |
|
1] |
Year of Establishment |
Yes |
|
2] |
Locality of the firm |
Yes |
|
3] |
Constitutions of the firm |
Yes |
|
4] |
Premises details |
No |
|
5] |
Type of Business |
Yes |
|
6] |
Line of Business |
Yes |
|
7] |
Promoter's background |
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 involved in |
-- |
|
23] |
Banking Details |
Yes |
|
24] |
Banking facility details |
Yes |
|
25] |
Conduct of the banking
account |
-- |
|
26] |
Buyer visit details |
-- |
|
27] |
Financials, if provided |
Yes |
|
28] |
Incorporation details, if
applicable |
Yes |
|
29] |
Last accounts filed at
ROC |
Yes |
|
30] |
Major Shareholders, if
available |
No |
|
31] |
PAN of Proprietor/Partner/Director,
if available |
No |
|
32] |
Passport No of
Proprietor/Partner/Director, if available |
No |
|
33] |
Voter ID No of
Proprietor/Partner/Director, if available |
No |
FINANCIAL RESULTS
This financial year has been a year of significant importance since the
refinery started commercial production in 2008. During the year the Company
generated a strong revenue growth of 25% at Rs.531190.000 millions up from
Rs.424020.000 millions in the previous financial year. This growth can be
attributed both to increase in throughput and higher oil prices. The Current
Price Gross Refinery Margin (CP GRM) for the refinery business increased to US$
6.91 per barrel from US$ 3.7 per barrel for the previous financial year. The
EBIDTA grew by more than 43% to Rs.27790.000 millions from Rs.19380.000
millions for last financial year. Annual Profit after Tax (PAT) jumped to
Rs.6540.000 millions from Rs.290.000 millions in previous financial year, a
23-fold increase.
Considering the profits for the current financial year, carry forward of
losses of previous financial years and funds requirements for meeting expansion
plans of the Company, the Board has not recommended any dividend for the
financial year.
MANAGING DIRECTOR
AND CEO’S REPORT
Refining
The refinery achieved a throughput of 14.76 MMT in FY2010-11—a capacity
utilization of more than 140 per cent. This is the highest volume they have
ever achieved and makes us one of India’s largest single location refineries.
They have also improved their operational efficiency, achieving the
lowest fuel and loss of 5.83 per cent ever. Their fluidized catalytic cracking
(FCC) unit completed an outstanding 515 days of on-stream operations. The
Visbreaker Unit achieved its highest ever on-stream period of 182 days.
As of 31st March 2011, the refinery had completed 1,094 days of
operations without a Lost Time Incident. The refinery team deserves praise for
improving efficiency without compromising on safety.
They commissioned the natural gas pipeline to their refinery and have
partly replaced fuel oil with gas, resulting in cleaner emissions. The refinery
has also started processing Mangala crude from Cairn India’s Barmer oilfield in
Rajasthan. About 1.3 MMT of Mangala crude was processed during the year.
Mangala crude improves their crude supply security and allows us to benefit
from lower logistics costs and taxes. The refinery processed 65 per cent of
lower cost, heavy or ultra-heavy crudes this year, while 74 per cent of its
products were higher value light and middle distillates.
Refinery expansion
project
A large part of the procurement and construction work for the refinery
expansion project was completed this year. With an overall progress of 86 per
cent as of 31st March 2011, mechanical completion of the expansion
units will be achieved in the second and third quarters of this calendar year.
The optimisation project to further enhance the capacity to 20 MMTPA is on
track. The Phase 1 expansion and Optimization will not only increase production
but also enhance the refinery’s complexity from 6.1 to 11.8. This will help us
increase the proportion of lower cost, heavy and ultra-heavy crude that the
refinery processes, and produce a greater proportion of higher value middle and
light distillates.
Marketing
For their marketing business, this has been a mixed year. While petrol
pricing was deregulated in June 2010, high crude oil and product prices in the
latter part of the financial year made it difficult for retailers to match
international petrol prices. However, taking advantage of a level playing field
in petrol retailing earlier in the year, their retail team notched up 155 KT of
petrol sales. This is the highest petrol retail sales volume they have ever
achieved and they could have improved on this figure had market conditions not
slowed us down in the latter part of the year.
They continue to expand their retail network, though now at a slower
pace. They have 1,381 operational outlets, with another 254 in various stages
of construction. In a bid to provide their franchisees with additional revenue
sources, the company has forged alliances with alternative non-fuel retailers
in segments like financial services and food and beverages. They have also
partnered with auto-gas marketing companies and added CNG and Auto-LPG
dispensing stations in some outlets.
In total they sold 8.95 MMT of products—64 per cent (by volume) of total
sales—in the domestic market. This has
dropped from last year’s domestic sales of 9.55 MMT and reflects their
considered strategy of exporting diesel during the low-demand monsoon months.
The dip in domestic sales is also because of diminished demand for fuel oil in
the Indian market because of natural gas availability from the KG D-6 block.
International
supply and trade
They exported a record 5.11 MMT of products from the Vadinar refinery.
Once the refinery expands to 18 MMTPA later in this calendar year, exports will
play a key role in their sales mix.
Exploration and
Production
They took significant steps in their exploration and production (EandP)
business this year.
In the Raniganj block they are producing 35,000 standard cubic metres
per day of Coal Bed Methane (CBM) gas.
Sales have commenced through cascades and commercial sales will start
soon.
They have signed contracts for the four blocks awarded in the CBM-IV
round of bidding. They have applied for a
Petroleum Exploration License for these blocks. They have continued
production of crude in small quantities in the Mehsana block and are now
looking to augment the production by developing some of the proven wells in
this block.
Market outlook
India experienced sustained economic growth in FY2010-11 with GDP
growing around 8.5 per cent one of the highest rates among the world’s major
economies. With nominal GDP forecast at US$1.73 trillion, India will make the
transition from a low income to a middle income country as per capita income
passes US$1,200.
Seeing substantial growth opportunities, foreign institutional investors
(FIIs) injected around US$37 billion into the Indian market during the last 12
months. The Government has mandated Rs.2140000.000 Millions for infrastructure
development in 2011-12 a 23.3 per cent increase on the previous year. Exports
grew by 37.6 per cent and imports registered around 21.6 per cent growth from
FY2010-11. Food inflation reduced from 20 per cent to a more modest 12 per cent
by the fiscal year-end.
It is estimated that India’s total primary energy consumption will grow
by 39 per cent in the 20 year period from 1995 to 2015 and increase a further
55 per cent by 2035 (International Energy Outlook, 2010 – US Energy Information
Authority).This sustained growth of incomes, infrastructure, spending and vehicle
ownership positively impacts India’s energy demand growth; which correlates
with their strategy to focus on energy demand growth in India.
Consumption of petroleum products grew by 2.9 per cent in the last year
to an estimated 141.8 MMTPA. Consumption of high speed diesel and motor spirit
showed year-on year growth of 6.7 per cent and 10.7 per cent respectively. The
number of commercial and passenger vehicles is estimated to grow at 18 per cent
and 23 per cent respectively and demand for fuels is expected to remain strong
in the current year. The price de-regulation of motor spirit in the domestic
market has led to prices becoming competitive, with greater earnings potential
for private sector marketers.
Current events in the Middle East and North Africa have a deep impact on
India, which imports around 80 – 85 per cent of its crude oil requirement. That
situation is expected to continue despite significant discoveries of oil and
gas in India in recent years. Subject’s E and P portfolio has 11 of its 17 oil
and gas and coal bed methane blocks located in India. Given the domestic demand
scenario, commercialisation of these assets represents a significant
opportunity for Subject. Once the acquisition of Stanlow refinery in the UK by
Essar Energy plc is completed, it will increase the sales options available for
the export of high value products produced at their Vadinar refinery.
REFINING:
The Vadinar refinery in Gujarat continues to operate well above its nameplate
capacity of 10.5 MMTPA. It processed a record 14.76 million tones of crude oil
(107.3 million barrels) during FY2010-11, 9 per cent higher than the 13.50
million tonnes of crude oil (98.4 million barrels) processed in FY2009-10. This
produced a CP GRM, inclusive of sales tax benefit, of US$6.91 per barrel for
FY2010-11 an 87 per cent improvement compared with a CP GRM of US$3.70 per
barrel in FY2009-10.
In June 2010, the refinery received its first supply of the low sulphur,
heavy and high pour Mangala crude through a dedicated heated and insulated
pipeline from Cairn India’s Barmer oil fields in Rajasthan. This is an
important new source of crude as it improves crude oil supply security and
offers the added benefits of lower logistics costs and taxes. The refinery
processed about 1.33 million tonnes of Mangala crude between June 2010 and
March 2011.
Phase 1 expansion of the Vadinar refinery is scheduled to reach
mechanical completion in phases in the second
and third quarters of calendar year 2011. The majority of increased
production from new units will commence in Q4 of calendar year 2011.
Completion of Phase 1 of the refinery expansion will increase production
to 375,000 barrels per stream day
(bpsd) from 300,000 bpsd and significantly increase the refinery
complexity from 6.1 to 11.8. With this, the refinery can increase the
proportion of heavy and ultra-heavy crude it processes, producing a higher
proportion of middle and light distillates. The result will have a positive
impact on GRM. While the construction costs of the Phase I refinery project are
within the overall budget, costs are estimated to increase by approximately
5000.000 million (US$111.6 million), or 6.4 per cent of the original project
cost, mainly due to an expected delay in commissioning and related interest
costs and pre-operative expenditure.
The Company plans to further increase the capacity of the refinery to 20
MMTPA, or 405,000 bpsd. This will be achieved through optimisation of some
refinery units at an estimated cost of 17000.000 millions (c. US$380 million).
The project is expected to be completed by September 2012.
Favourable crude
mix: The capacity expansion, complexity enhancement and subsequent
optimisation will give the Vadinar refinery the capability to process nearly 90
per cent ultra heavy crudes, which are cheaper than light or heavy crudes.
Favourable product
yield: In terms of product yield, the capacity expansion, complexity
enhancement and subsequent optimisation will give the Vadinar refinery higher
flexibility between light and middle distillates. This will enable the
conversion of the majority of their fuel oil production into higher value
products, including pet coke.
With a crude mix that can accommodate a higher quantity of cheaper,
heavier crudes and a product slate with a larger proportion of high value
products, the Vadinar refinery is set to become India’s second most efficient
refinery in terms of cost per barrel. This will result in a significant boost
in the Gross Refining Margin (GRM).
MARKETING
Subject operates a franchise-based retail model, with 1,381 outlets
across India selling petrol and diesel under the Essar brand. Another 254
outlets are under construction and are in various stages of completion.
In June 2010, the Government of India announced plans to fully
deregulate petrol prices and to gradually deregulate diesel prices as well.
This decision supported their plans to increase their retail fuel outlets to
1,700 by March 2011. However, increasing oil prices have put pressure on the
market price of diesel. This in turn has caused uncertainty regarding the
Government’s plans to deregulate retail prices of diesel. As a result, Subject
intends to slowdown its plans to increase retail outlets beyond 1,700 until
there is further clarity on diesel deregulation.
The Company is increasing non-fuel retailing activities in its current
portfolio of retail outlets to provide an additional source of revenue for its
franchisees. Alliances have been forged with alternative fuel and non-fuel
retailers in segments like auto gas, auto components, lubricants and services.
EOL has also setup points of sale at its outlets for retailers in the food and
beverages, agro products, telecom and banking/finance segments. The Company is
now focusing on introducing Auto LPG and CNG pumps in its outlets through
tie-ups with Aegis Logistics and GAIL India Limited respectively. The Company
is also sourcing auto gas for its outlets from other companies operating in
this space. Two CNG stations have been commissioned in Surat and Ahmedabad, in
association with Sabarmati Gas and Gujarat State Petroleum Corporation.
Sales performance
In FY 2010-11, Subject sold 7.19 MMT of diesel, petrol, LPG and kerosene
to Public Sector Oil Companies. This is slightly lower than the 7.30 MMT of
these products sold in FY 2009-10 to Public Sector Oil Companies, but this
performance is commendable because of the more intense competition from other
private sector refiners in this fiscal.
In total Subject sold 8.95 MMT of products - 64 per cent (by volume) or
68 per cent (by value) in the domestic market. This has dropped from last
year’s domestic sales of 9.55 MMT and reflects the Company’s considered
strategy of exporting diesel during the low-demand monsoon months. The dip in
domestic sales is also because of diminished demand for fuel oil in the Indian
market because of natural gas availability from the KG D-6 block.
Export outlook
The Company exported a record 5.11 MMT of products from the Vadinar
refinery this fiscal. Once the refinery expands to 18 MMTPA later in 2011,
exports will play a key role in Subject’s sales mix.
FINANCIAL
HIGHLIGHTS
·
The Company’s revenues increased by Rs.107170.000
millions representing a 25 per cent growth year on year, from Rs. 424020.000
millions in FY2009-10 to Rs.531190.000 millions in FY2010–11, primarily driven
by record refinery throughput and increased product prices Profit after tax increased by Rs.6250.000
millions representing a 23 fold growth from Rs.290.000 millions FY2009–10 to
Rs.6540.000 millions in FY2010-11
·
The above improvements resulted in earnings per
share for FY2010–11 improve to Rs.4.85 per share as a result of increased
profits against Rs.0.25 per share for FY2009-10
FIXED ASSETS:
· Land
· Building
· Plant and machinery
· Producing properties
· Furniture and fixtures
· Office equipment
· Vehicles
· Aircraft
· Softwares and licenses
PRESS RELEASE:
INDIA'S ESSAR OIL
LOSES $615 MLN INSURANCE CLAIM
FEBRUARY 28, 2012
Indian refiner Essar Oil said a tribunal had ruled against the company in a case relating to its 30.2 billion rupee ($615 million) insurance claim for damages sustained by its refinery during a cyclone in 1998.
"The verdict has no impact on their business since the claim amount has never been accounted for in Essar Oil's books," the company said in a statement on Tuesday.
Essar had drawn an insurance policy with state-run United India Insurance Co in 1996, the company said.
ESSAR OIL’S 3
ACCOUNTS FROZEN IN RS. 80000.000 MILLIONS CASES
JULY 10, 2012
The Gujarat government froze three bank accounts of Essar Oil Ltd of the Rs. 1.5-lakh-crore Essar Group on Monday, taking the first step to recover Rs. 84140.000 millions sales tax dues. The action comes two weeks after the Gujarat high court rejected a petition by Essar Oil to be allowed to pay Rs. 61690.000 millions in eight yearly instalments.
The company, however, said in a press release: “Essar Oil has
already agreed to pay Rs. 10000.000 millions within 30 days to the Gujarat
government towards the sales tax liability.”
The company also wrote to the state, asking for a committee to
jointly discuss the modalities of paying the balance principal amount and
consider waiver of interest payments.
The high court had rejected the company’s appeal for waiver of
penalty and interest payments. In January, the Supreme Court rejected the
company’s plea for sales tax deferment benefits under a special state
government programme to attract investments.
The company lost the eligibility for tax deferment incentive as
it failed to begin operations at its Vadinar oil refinery by April 2003.
Although the project went on stream in 2006, the company utilised the benefits,
which the state government now wants it to repay.
On the Bombay Stock Exchange, the Essar Oil share went down by 2.34% to Rs. 56.35 from Rs. 57.70.
GOVERNMENT ATTACHES
FIVE BANK ACCOUNTS OF ESSAR OIL IN SALES TAX DEFERRAL CASE
JULY 10, 2012
Gujarat government's sales tax department on Monday attached five bank accounts of Essar Oil Ltd (EOL) in Jamnagar district and recovered about Rs 40.000 millions as a part of pending sales tax recovery of close to Rs 88000.000 millions
"They have attached a total of five bank accounts of Essar Oil Limited and recovered about Rs 40.000 millions from these accounts. The action was taken on Monday as a part of the pending recovery of 88000.000 millions from the company on the sales tax deferral case," said a senior official at office of assistant commissioner of sales tax at Jam Khambhaliya in Jamnagar district. "Since 2008, the company has already availed the benefits under the state government's scheme, but has not produced the certificate to have obtained the deferral on sales tax. This has prompted us to attache the bank accounts of the company," the official explained.
RELATED STORIES
· Essar Oil secures Rs 50000.000 millions credit from 12 banks
· Essar Oil borrows Rs 50000.000 millions to meet sales tax dues
· Essar Oil set to invest another Rs 20000.000 millions in Ranigunj block
· Sales tax officials attach 5 bank accounts of Essar Oil
· Essar Oil dips on rejection of sales tax recovery plea
Of the sealed accounts, two accounts are held with each HDFC bank and State Bank of India (SBI), while one account is with ICICI bank, the official sources revealed. Two accounts were located in Jamnagar city, while one each was located at Vadinar, Moti khavdi and khavdi area near the refinery of the company.
"Essar Oil is surprised and disappointed by the Gujarat government's unexpected step of attaching the bank accounts of Essar Oil despite the company clearly stating its intent to pay the sales tax due to the state. As a statement of its bonafide intent, Essar Oil has already agreed to pay Rs 10000.000 millions within 30 days to the Gujarat government towards the sales tax liability. Essar Oil has written to the state government requesting that a committee be formed which can jointly discuss the modalities of the payment of the balance principal amount of Rs 51690.000 millions and consider a remission of the past interest of Rs 19320.000 millions" the company said in an official statement.
"Essar Oil is clearly the aggrieved party on this matter despite making investments of over Rs 250000.000 millions in the refinery and a total of Rs 1000000.000 millions of investments in the set up in the state of Gujarat," the company further added.
It may be mentioned here that the Gujarat High Court on June 25 had directed the state government to expedite recovery of the over Rs 80000.000 millions due as sales tax deferral liability from the company.
"Considering the totality of the facts and circumstances, this is not the case where they would like to restrain the state from recovering the amount on the ground that the company and appealed to the state government to consider relief under section 41 and 42 of the Gujarat Value Added Tax Act (GVATA)," the court had observed. In May, the company had also sought exemption from payment of interest and also sought directions for the state government to allow them to make repayment in form of eight annual instalments from April 2013 under the section 41 and 42 of GVATA respectively. It had also challenged the order of the state government rejecting similar reliefs. Later on in June, the company altered its petition and offered that it was ready to pay in six installments starting from this fiscal.
Following Supreme Court's decision early this year, the tax authorities of Gujarat Government had slapped a demand notice to Essar Oil for repayment of sales tax deferment benefits utilised by the company to the tune of Rs 63000.000 millions with payable interest. Under the state government's scheme, 'Capital Incentive to Premier and Prestigious Unit Scheme 1995-2000', Essar was given a provisional 'premier' registration for setting up an integrated greenfield refinery at Vadinar near Jamnagar with an investment of over Rs 55000.000 millions
The planned capacity of the refinery was put at 9 million tonnes of crude processing per annum. As per the terms of said scheme, the state government said that the sales tax which actually accrues to the companies investing under this scheme for nearly 17 years can be paid after 17 years in six equal installments.
This would mean, that the company could retain the sales tax for 17 years and can use the same as cash flow. And then it has to pay back without any interest after 17 years.
ESSAR OIL LIMITED:
RESULTS FOR THE QUARTER AND YEAR ENDED 31ST MARCH 2012
REFINERY EXPANSION
PROJECT COMPLETED; CO MOVES UP THE VALUE CHAIN
MAY 12, 2012
Key Highlights
Overall
· Refinery expansion project to increase capacity to 18 MMTPA and complexity to 11.8 completed, leading to significant upside in refinery value chain.
· Optimisation project to further increase capacity to 20 MMTPA on track; completion expected by September 2012
· FCCBs of $262 million issued to Essar Energy PLC made compulsorily convertible; giving boost to net worth impacted due to one time sale tax reversal
· Writ petition seeking direction on the repayment instalments and interest in relation to its sales tax deferral liability admitted by Honourable Gujarat High Court.
· CDR exit proposal expected to be approved shortly
Financial Highlights
· Gross revenues for Q4FY12 up 29% to Rs 191600.000 millions compared to Rs 148460.000 millions reported in Q4 FY11. Revenues for FY12 were up 19% Rs 633400.000 Millions compared to Rs 531190.000 Millions in FY11.
· Q4FY12 EBITDA at Rs 4440.000 millions down 51% against Rs 9110.000 millions in Q4 FY11.EBITDA for FY12 stood at Rs 21060.000 millions, down 24% from Rs 27790.000 millions for FY11 mainly due to sales tax incentive not available in Q4FY12 and lower throughput due to planned shutdown.
· CP GRM for Q4FY12 stood at US$ 4.60 /bbl compared to US$ 5.29 /bb in Q4FY11. For FY12, it was US$ 4.23 /bbl compared to US$ 4.53 /bbl in FY11.
Refining
· Throughput of Q4FY12 up 10.4% at 4.03 MMT against 3.65 MMT in Q4FY11, due to increase in the refinery capacity. Throughput for the FY12 stood at 13.49MMT against 14.76MMT FY11;lower due to 35-day planned shutdown undertaken in September/October 2011.
· Substantial quantity of ultra heavy crude, required for expanded, high complexity refinery, tied up from both domestic and international resources.
· Refinery maintains its excellent safety track record with 1460LTI free days as Mar 31st March, 2012.
Exploration and
Production
· Producing 25,000 scmd of CBM gas from 15 to 20 wells in Ranigunj, supply to end customers through pipeline and cascades continuing.
· Environmental Clearance for Phase – I (15 test wells) and phase-II (58 wells) received. Final environmental approval from MoEF for Phase III, expected by Sept ’12
· Proven and probable reserves at Raniganj CBM block significantly increased to 113 bcf while best estimate contingent resources are at 445bcf gross and best estimate prospective resources are at 297 bcf.
Mumbai, 12th May
2012:
Fourth quarter performance: Subject today reported gross revenues of Rs.191600.000 millions for the Q4FY12, compared to Rs 148460.000 millions in Q4FY11.
EOL’s quarterly EBITDA was at Rs 444.000 millions compared to Rs 9110.000 millions in the corresponding period last fiscal mainly due to sales tax incentive not recognized in Q4FY12.
The Current Price Gross Refinery Margin (see Appendix for explanation of CP GRM) for the Refinery business in Q4 FY 2011-12 was US$ 4.60 per barrel, compared to US$ 5.29 per barrel in Q4 FY 2010-11.
Full year financial performance: Gross revenues for FY12were Rs 633400.000 millions compared to Rs 531190.000 millions for FY11.
EBITDA for FY12 stood at Rs 2106 millions, as against Rs 27790.000 millions in FY11.
CP GRM for FY12 was US$ 4.23 /bbl, compared to US$ 4.53 /bbl for FY11.
LK Gupta, EOL’s Managing Director and CEO said:”They have completed a very challenging yet satisfying year at Essar Oil. During the year, they completed their refinery expansion programme, making us the second largest single location refinery in India and one of the most complex refineries in the world. This has opened up new markets for their products and provides flexibility for sourcing of crudes. With their optimization programme now nearing completion, they have reached the closure of their major capexprogramme. With this they have significantly moved up in the refining value chain and are now fully focused on delivering the value of their investments to their stakeholders.”
Suresh Jain, Chief Financial Officer, EOL, said, “With their capex funding requirement coming to an end, ensuing CDR exit, and benefits of higher capacity and complexity will soon be visible in terms of incremental operational cash flows, which will be utilised to deleverage the balance sheet and boost their valuation.“
(Rs. In millions)
|
Particulars |
Q4 FY11-12 |
Q3 FY11-12 |
Q4 FY10-11 |
FY 11-12 |
FY10-11 |
|
Revenue (gross) |
191600.000 |
138970.000 |
148460.000 |
633400.000 |
531190.000 |
|
0EBITDA |
4440.000 |
4900.000 |
9110.000 |
21060.000 |
27790.000 |
|
Profit Before Tax |
(5150.000) |
(40680.000) |
4160.000 |
(43770.000) |
8280.000 |
|
Profit After Tax |
(5150.000) |
(39860.000) |
3210.000 |
(41990.000) |
6540.000 |
(Rs. In millions)
|
Particulars |
As on Mar 12 |
As on Mar 11 |
|
Property, Plant and Equipment (Gross) |
260390.000 |
221510.000 |
|
Debt (long-term) |
133690.000 |
124270.000 |
|
FCCB |
-- |
11710.000 |
|
Net Worth |
36130.000 |
65380.000 |
Net worth includes FCCBs of US$ 262 million as of 31st Mar, 2012, equivalent to Rs 13400.000 millions issued to EOL’s parent company pursuant to FCCBs made compulsory convertible during Q4FY12.
Long-term debt includes project debt and -of Rs 53910.000 millions (Rs 42060.000 millions in the corresponding previous year) mainly related to project debt.
Company seeks court’s
direction on sales tax repayments
Post rejection of its review petition by the honorable Supreme Court in relation to repayment of deferred sales tax, the company had made representation to Gujarat government for allowing it to pay the sales tax deferral dues in installments and remission of interest. As the issues could not be resolved amicably with the government, Essar Oil filed a writ petition in honorable Gujarat High Court to seek direction on the repayment installments and interest of its sales tax deferral liability to the Government of Gujarat. The honorable High Court has admitted its petition and has fixed the next hearing on June 22nd, 2012.
The Company has already provided Rs 40150.000 millions as an exceptional item in its book as reversal of sales tax incentive income in Q3FY12 and considering the net accretion of Rs 530.000 millions in Q4FY12 on account of defeasement, the net reversal for the year is Rs.39620.000 millions
Operational
Highlights
Refining Business
Throughput
Throughput for Q4FY12 quarter was up 10.4% to 4.03 MMT due to increase in capacity .
Throughput for the FY12 stood at 13. March 2011; lower due to 35-day planned shutdown undertaken in September/October 2011.
Crude Mix
The refinery processed over 30 types of crudes in the year, including ultra heavy and tough crudes like Maya (Mexico), Altimira (Mexico), and Castellan (Columbia). At 75%, the proportion of ultra heavy & heavy crude processed in the quarter was significantly higher than the 63% recorded in the corresponding quarter last fiscal.
Product Mix
In terms of product yield, Essar Oil now has the flexibility to produce higher value, high-quality products. Close to 80% of its production will now be of valuable light and middle distillates; and over 50% of the production of Gasoil (diesel) and Gasoline specifications.
Despite the
increase in heavy and ultra heavy crude diet, the refinery continued to
optimise production of higher margin middle and light distillates. Owing to
availability of healthier margins from fuel oil during the quarter, heavy
distillate production was hiked to 28% of the total production during the
quarter, against 25% in the previous quarter
Sales and
Marketing
PSU/Bulk Sales: In terms of sales value, the company sold 63% of its products in the domestic market while 37% of the products were exported during the quarter. In comparison, exports in the corresponding quarter in the last fiscal were around 33% of total sales. Out of the 63% of products sold in the domestic market, 58% were sold to oil and gas PSUs (Public Sector Undertaking) and the balance sold through bulk/direct sales and their retail network.
In spite of the new refining capacity added in FY12 (Bhatinda, Bina, MRPL), EOL is expected to retain the sales volumes it markets to PSUs and in the domestic market due to healthy petro product demand growth in India. In addition, its capability to supply BS IV grade products, which the expansion has helped achieve, will also give it a competitive edge. This will translate to better product margins for EOL compared to exports. However, the proportion of export sales may increase in the near term because of new refining capacity added by PSU refineries. Export volumes will come down in the medium term with India once again likely to become deficient in refined petroleum products, particularly diesel, in the next three to four years.
EOL is prepared to capitalise on this growth through long-term product
and infrastructure sharing contracts with oil PSUs (IOC, BPC,HPC) and Shell. It
also entitles EOL to purchase products from them and gives the companies the
option of sharing each other’s distribution infrastructure.
Retail: As on 31st March 2012, EOL had about 1600 retail outlets selling
petrol and diesel under the Essar brand. These include 1400 operational
outlets, while the rest are in various stages of construction.
Sales through EOL’s countrywide network of dealer owned dealer operated
outlets went down in the quarter because of the anomaly between retail product
prices and prevailing international crude prices. PSU oil marketing companies
are able to sell fuel at subsidised rates because the government compensates
them for their under-recoveries. With no such incentive, EOL has to price the
products sold through retail outlets in tandem with the fluctuations in
international crude prices.
As part of its multi fuel option for the customers, Essar Oil has inked
an agreement with Indraprastha Gas during the quarter to put up latter’s CNG
pumping facilities at EOL outlets in the National Capital Region. The company
added seven new CNG stations in the quarter to its network of retail outlets,
taking its total of Auto LPG and CNG stations in the network to 17.
Safety track record and recognition: As on 31st March 2012, the Vadinar
refinery has recorded 1460 days of operations without a Lost Time Injury (LTI),
1045 major fire free days, and 11.30 million hours of safe operations. This goes
to show that the refinery personnel have consistently delivered a high
production rate without making any compromises on safety standards.
The Vadinar Refinery received several awards during the quarter. Most notable among them are
· Certificate of Appreciation for Lowest Disability Injury Index (DII) and Certificate of honor for completing more than 3 Million Man hours without any reportable injury by Government of Gujarat, Gujarat Safety Council for the year 2010
· 2nd Prize for performance in Energy Optimization and Hydrocarbon Loss Management by CHT (under MOPNG) for Jawaharlal Nehru Centenary Awards-2011
· 3rd Prize for managing Steam Leaks by CHT (under MOPNG) during Oil and Gas Conservation Fortnight (OGCF-2011) survey Refinery Expansion Project set to deliver Significant Value:
Refinery Expansion
Project set to deliver Significant Value:
Vadinar Refinery is second largest single site refinery in India and amongst the most complex globally for a refinery of this scale. The refinery has been built with one of the lowest capital cost of $12,746 per barrel, against world average of $23,000 per barrel.
Vadinar refinery will benefit from fully integrated infrastructure developed including power plant, port, pipeline, and tankages with multi product multi modal despatch facilities. Capacity addition, complexity impact, and coal fired power plant to collectively add significant uplift to EBITDA in the coming years.
Crude Sourcing: The Company will require around 85-90 million barrels of ultra heavy crude for the expanded refinery. The company has already entered into long-term crude sourcing contract with global and domestic suppliers, including several national oil companies from Latin America. Essar Oil would be sourcing 15-20% of its crude requirement from the domestic market, 35-40% from the Latin American sources, and 30-40% from West Asia.
Export strategy: EOL sells one third of its products in the exports market, mainly Gasoline and Fuel Oil. Post expansion, main export products would be Gasoline, Gasoil, and VGO.
EOL is planning to leverage the presence of its parent company, Essar Energy, in product deficit markets and sharing of streams, like moving VGO to Stanlow, amongst refineries. EOL is targeting Australia, New Zealand and north-west Europe for exporting high quality fuels.
Optimisation project
Significant progress has been made in the implementation of the optimisation project for the Vadinar Refinery, with 90% of the project completed (as on Mar 31st, 2012). As part of this project, the VBU (Visbreaker Unit) which has become redundant post the completion of the Phase I expansion is being converted into an additional CDU of 2 MMTPA capacity.
By September 2012, when the optimisation project is expected to be completed, the refinery capacity will further increase to 20 MMTPA, or 405,000 bpsd.
Exploration and Production
Essar's exploration and production business has 2.1 billion barrels of oil equivalent of reserves and resources. The independently verified proven and probable reserves and best estimate 2C contingent gas resources at its Raniganj Coal Bed Methane (CBM) block in West Bengal have been significantly increased recently, following the latest report from NSAI (Netherland Sewell and Associate).
The total proven and probable reserves (2P) at Raniganj, evaluated as on 1 September 2011, are 113 billion cubic feet (bcf) gross, or 18.8 million barrels of oil equivalent (mmboe). Best estimate contingent resources (2C) are 445bcf gross, or 74.1 mmboe, and best estimate prospective reserves are 297 bcf or 49.5 mmboe. NSAI has upgraded the quality of reserves from 201 in 2P/2C earlier to 558 bcf under the new certification. It is important to note that calorific value of CBM gas has also been improved to 9,660 in the latest certification compared to 8,500 in the earlier report.
EOL has drilled 73 wells at Ranigunj, producing about 25,000 scmd from 15 to 20 wells, which is supplied to end customer through pipeline. Environmental Clearance for Phase - I (15 test wells) and phase-II (58 wells) has been received and pilot well drilling completed and applied for moving to Phase-III (Development Phase). Final approval from MOEF expected by Sept '12.
The Company is a leading CBM player in the country with 2,733 sq km of acreage and more than 10 tcf of reserves and resources in place across five blocks (see table below). It has a presence in key markets that are deficient in natural gas supplies.
|
CBM Blocks |
Place |
Certified |
Acreage (km2) |
2P/2C resources (bcf) |
Prospective
Resources (bcf) |
In place Unnsked
Resource (bcf) |
|
Raniganj |
West Bengal |
NSAI r Jan 12 |
500 |
558 |
297 |
|
|
Rajmahal |
Jharkhand |
CPR,ARI |
1128 |
|
4,723 |
|
|
Sohagpur |
M.P. and Chhattisgarh |
DGH |
339 |
|
|
600 |
|
Talcher |
Orissa |
DGH |
557 |
|
|
2,600 |
|
IB Valley |
Orissa |
DGH |
209 |
|
|
1,200 |
|
Total |
|
|
2733 |
558 |
5,020 |
4,400 |
Financial Review
Gross revenues: Gross Revenue for the Q4FY12 increased to Rs 191600.000 millions as compared to Rs 148460.000 millions in Q4FY11 mainly due to higher throughput and increase in product prices
Gross revenue increased to Rs 633400.000 millions in FY12 from Rs 531190.000 millions in FY11. The rise was primarily driven by increased product prices, which was partly offset by decrease in sales quantity on account of the planned refinery shutdown.
EBITDA: For Q4FY12, EBIDTA has declined to Rs 4440.000 millions as compared to Rs. 9110.000 millions for Q4FY11, due to decline in gross refinery margin, and sales tax incentive not available in the fourth quarter post Supreme Court order.
For FY12, EBIDTA was Rs 21060.000 millions compared to Rs. 27790.000 millions in FY11. This is lower mainly on account of decrease in refinery throughput due to planned shutdown, decline in gross refinery margin, MTM provision for forex loss, shutdown expenditures, and sales tax incentive not available post Supreme Court order for Q412.
Profit / (Loss) before and after Tax : For the quarter and financial year ended March, 2012, the profit before and after tax declined due to lower EBITDA as explained above, reversal of sales tax benefits and provision of Rs.3220.000 millions for CDR exit proposal.
For reasons above, the company reported negative PAT (after exceptional items) for Q4FY12 and FY12 at Rs (5150.000 millions) and Rs (41990.000 millions) respectively against profit of Rs.3210.000 millions and Rs.6540.000 millions for corresponding periods of FY11.
Gross Property, Plant and Equipment: The gross value of Plant and Machinery has increased by 18% to Rs 260390.000 millions. This increase is mainly on account of Expansion and Optimization Projects.
Gross Long Term Debt: Gross Debt has increased by Rs.9420.000 millions to Rs.133690.000 millions as on 31st March 2012, compared to Rs 124270.000 millions as on 31st March 2011. This is also on account of the ongoing Expansion / Optimization Projects.
Net worth: The net worth for the year ending March 31, 2012 is Rs 36130.000 millions against Rs 65380.000 millions in March 31, 2011. The decrease in net worth is due to sales tax reversal of Rs 3962 millions, which was partly offset by conversion of Foreign Currency Conversion Bond (FCCB) of Rs 13400.000 millions held by holding company in to Foreign Currency Compulsory Conversion Bond (FCCCB) resulting in the improvement of net worth of the Company which had taken an impact on account of sales tax reversal of Rs.39620.000 millions in FY12.
CDR Update: Essar Oil's Corporate Debt Restructuring exit proposal has been approved by majority of its lenders at CDR - EG and the matter has now been referred to the Core Group for final approval. The process is expected to be completed during the current quarter. CDR exit would provide operational flexibility and an opportunity to reduce cost of debt.
About Essar Oil
Essar Oil is a fully integrated oil and gas company of international scale with strong presence across the hydrocarbon value chain from exploration and production to refining and oil retail. It has a global portfolio of onshore and offshore oil and gas blocks, with about 2.1 billion barrels of oil equivalent in reserves and resources. Essar Oil now has over 360,000 bpsd (barrels per stream-day) of crude refining capacity that is being expanded to 405,000 bpsd. There are more than 1,600 Essar-branded oil retail outlets in various parts of India.
About Essar Group The Essar Group is a multinational conglomerate and a leading player in the sectors of Steel, Energy, Infrastructure and Services. With operations in more than 25 countries across five continents, the Group employs 75,000 people, with revenues of US$ 17 billion.
FIXED ASSETS
·
Tangible assets
·
Land
·
Building
·
Plant and machinery
·
Producing properties
·
Furniture and fixtures
·
Office equipment
·
Vehicles
·
Aircraft
·
Intangible assets
·
Software and licenses
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.56.38 |
|
|
1 |
Rs.87.44 |
|
Euro |
1 |
Rs.68.05 |
INFORMATION DETAILS
|
Report Prepared
by : |
BSN |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
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 |
6 |
|
--RESERVES |
1~10 |
6 |
|
--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 |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
54 |
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.