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Report Date : |
29.10.2012 |
IDENTIFICATION DETAILS
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Name : |
HABIB SUGAR MILLS LIMITED |
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Registered Office : |
4th Floor, |
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Country : |
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Financials (as on) : |
30.09.2011 |
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Year of Establishment : |
1968 |
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Com. Reg. No.: |
0002673 |
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Legal Form : |
Public
Limited Company |
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Line of Business : |
manufacturing and marketing of refined sugar, molasses, ethanol, liquid carbon dioxide, household textiles and providing bulk storage facilities |
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No. of Employees : |
600-700 employees |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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Payment Behaviour : |
No Complaints |
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Litigation : |
Clear |
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 30th, 2012
|
Country Name |
Previous Rating (31.03.2012) |
Current Rating (30.06.2012) |
|
Pakistan |
B2 |
B2 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
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Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
pakistan - ECONOMIC OVERVIEW
Decades of
internal political disputes and low levels of foreign investment have led to
slow growth and underdevelopment in Pakistan. Agriculture accounts for more
than one-fifth of output and two-fifths of employment. Textiles account for
most of Pakistan's export earnings, and Pakistan's failure to expand a viable
export base for other manufactures has left the country vulnerable to shifts in
world demand. Official unemployment is 6%, but this fails to capture the true
picture, because much of the economy is informal and underemployment remains
high. Over the past few years, low growth and high inflation, led by a spurt in
food prices, have increased the amount of poverty - the UN Human Development
Report estimated poverty in 2011 at almost 50% of the population. Inflation has
worsened the situation, climbing from 7.7% in 2007 to more than 13% for 2011,
before declining to 9.3% at year-end. As a result of political and economic
instability, the Pakistani rupee has depreciated more than 40% since 2007. The
government agreed to an International Monetary Fund Standby Arrangement in
November 2008 in response to a balance of payments crisis. Although the economy
has stabilized since the crisis, it has failed to recover. Foreign investment
has not returned, due to investor concerns related to governance, energy,
security, and a slow-down in the global economy. Remittances from overseas
workers, averaging about $1 billion a month since March 2011, remain a bright
spot for Pakistan. However, after a small current account surplus in fiscal
year 2011 (July 2010/June 2011), Pakistan's current account turned to deficit
in the second half of 2011, spurred by higher prices for imported oil and lower
prices for exported cotton. Pakistan remains stuck in a low-income, low-growth
trap, with growth averaging 2.9% per year from 2008 to 2011. Pakistan must
address long standing issues related to government revenues and energy
production in order to spur the amount of economic growth that will be
necessary to employ its growing population. Other long term challenges include
expanding investment in education and healthcare, and reducing dependence on
foreign donors.
|
Source : CIA |
HABIB SUGAR MILLS
LIMITED
|
Registered
Address |
|
4th Floor, Imperial Court, Dr.
Ziauddin Ahmed Road, Karachi, Pakistan |
|
Tel # |
92 (21) 35680036 |
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Fax # |
92 (21) 35684086 |
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Email |
Nawabshah, Sindh, Pakistan
|
a. |
Nature of Business |
The Company is engaged in the manufacturing
and marketing of refined sugar, molasses, ethanol, liquid carbon dioxide,
household textiles and providing bulk storage facilities. |
|
b. |
Year Established |
1968 |
|
c. |
Registration # |
0002673 |
Ernst & Young Ford Rhodes Sidat Hyder
(Chartered Accountants)
Habib Sugar Mills Limited is a public limited Company incorporated in
Pakistan, with its shares quoted on the Karachi and Lahore Stock Exchanges.
|
Names |
Designation |
|
Mr. Asghar D. Habib Mr. Raeesul Hasan Mr. Ali Raza D. Habib Mr. Muhammad Nawaz Tishna Mr. Murtaza H. Habib Mr. Farouq Habib Rahimtoola Mr. Amin Ali Abdul Hamid Mr. Imran A. Habib |
Chairman Chief Executive Director Director Director Director Director Director |
|
Categories |
Percentage |
|
Individuals Insurance Companies Joint Stock Companies Financial Institutions Modaraba Companies Charitable Trusts Societies Corporate Law Authority Properties Organisation |
34.07 7.41 28.17 21.80 0.44 7.73 0.35 --- 0.03 |
(1) Habib Insurance Company Limited, Pakistan.
(2) Habib Mercantile Company (Pvt) Limited, Pakistan.
(3) Habib & Sons (Pvt) Limited, Pakistan.
(4) Bank AL Habib Limited, Pakistan.
(5) Hasni Textiles (Pvt) Ltd, Pakistan.
The Company is engaged in the manufacturing and marketing of refined sugar, molasses, ethanol, liquid carbon dioxide, household textiles and providing bulk storage facilities.
600 - 700
2011 2010
Working Working
Quantity days Quantity
days
Sugar division
Crushing capacity 7,000
M.Tons Per Day 7,000 M.Tons Per Day
Capacity based on actual
working days 1,022,000 M.Tons 146 784,000 M.Tons 112
Actual crushing 800,636 M.Tons 146 681,623 M.Tons 112
Sucrose recovery 9.87
% 10.24
%
Sugar production 79,056
M.Tons 69,784
M.Tons
In addition to production of sugar from
sugarcane, 4,609 M. Tons of sugar has been produced from refining 4,885 M.Tons
of raw sugar.
Sugar unit operated below capacity due to
lesser availability of sugarcane.
Distillery division
a) Ethanol
Capacity 34,000 M.Tons 300 34,000 M.Tons 300
Actual production 29,303
M.Tons 338 26,210 M.Tons 323
Ethanol production was also below capacity
because lesser quantity of molasses was available and low recovery of ethanol.
b) Liquid Carbon Dioxide (CO2)
Capacity 6,000 M.Tons 300 6,000 M.Tons 300
Actual production 5,644
M.Tons 319 3,648 M.Tons 221
Textile division
Capacity 300,000
Kgs. 300 300,000
Kgs. 300
Actual production 484,885 Kgs.
300 352,490 Kgs.
300
The actual production of textile division was
higher than the capacity due to purchase of semi-finished goods.
Various Local
Allied Bank of Pakistan Limited, Pakistan.
Bank Al-Habib Limited, Pakistan.
Barclays Bank PLC, Pakistan.
Citibank N.A., Pakistan.
First Women Bank Limited, Pakistan.
Habib Bank Limited, Pakistan.
Habib Metropolitan Bank Limited, Pakistan.
MCB Bank Limited, Pakistan.
Meezan Bank Limited, Pakistan.
National Bank of Pakistan.
Standard Chartered
Bank, Pakistan.
United Bank Limited,
Pakistan.
Sound
The crushing season 2011-12 commenced on December 8, 2011 and upto
December 28, 2011 total crushing was 148,879 M.Tons with average sucrose
recovery of 9.7% and sugar production of 14,439 M.Tons including stock in
process. The Government of Sindh has issued a notification on October 25, 2011,
fixing the minimum sugarcane support price at Rs. 154 per 40 kgs for the
crushing season 2011-12. In addition, sugar mills in Sindh under the above
notification are also required to pay quality premium at the rate of paisas
fifty for every 0.1 percent recovery in excess of the benchmark of 8.7%.
However, in accordance with the said notification while the matter is still
pending with the Supreme Court of Pakistan and as per decisions of Federal Government
Steering Committee meeting, the quality premium shall remain suspended till the
decision of the Hon’ble Supreme Court or consensus on uniform formula is
developed by the Ministry of Food and Agriculture (MINFA). The domestic
increase of over 21% in the minimum sugarcane support price from Rs. 127 to Rs.
154 per 40 kgs will result in increase in the cost of production. On the other
hand, the sugar market is depressed and at the prevailing price the
profitability of the division may be adversely affected.
Upto December 28, 2011 the division has produced 2,851 M.Tons of ethanol
and 758 M.Tons of (CO2). The price of molasses continues to remain firm.
However, the price of ethanol in the international market has also improved
which is likely to have a favourable impact on the profitability of the
division. The liquid carbon dioxide (CO2) unit is expected to operate at
optimum levels and Inshallah the profitability of the unit is also likely to be
maintained.
The slump in the international market continues, however, the
installation of new high-tech looms, will, Inshallah, result in higher sale
volume and increased profitability of the division.
· All Pakistan Sugar Mills Association.(APSMA)
|
Currency |
Unit |
Pakistani Rupee |
|
US Dollar |
1 |
Rs. 95.50 |
|
UK Pound |
1 |
Rs. 152.00 |
|
Euro |
1 |
Rs. 122.30 |
Subject Company is well known and all the directors are resourceful and experienced businessmen. Trade relations are reported as fair. Payments to creditors etc are reported as normal. Company can be considered for normal business dealings at usual trade terms and conditions.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.53.63 |
|
UK Pound |
1 |
Rs.86.18 |
|
Euro |
1 |
Rs.69.75 |
INFORMATION DETAILS
|
Report Prepared
by : |
MNL |
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 |
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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 |
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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 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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.