MIRA
INFORM REPORT
|
Report Date : |
20.09.2012 |
IDENTIFICATION DETAILS
|
Name : |
PRAJ INDUSTRIES LIMITED |
|
|
|
|
Registered
Office : |
"PRAJ HOUSE",
Bavdhan,
Pune – 411021, |
|
|
|
|
Country : |
|
|
|
|
|
Financials (as
on) : |
31.03.2012 |
|
|
|
|
Date of
Incorporation : |
08.11.1985 |
|
|
|
|
Com. Reg. No.: |
11-038031 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs. 369.557
Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
L27101PN1985PLC038031 |
|
|
|
|
Legal Form : |
A Public Limited Liability Company. The Company’s Shares are Listed on
the Stock Exchanges. |
|
|
|
|
Line of Business
: |
Subject is
engaged in the business of Process and Project Engineering. |
|
|
|
|
No. of Employees
: |
800 (approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
A (64) |
|
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 22000000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a well 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 be correct and as per
commitments. The company can be considered normal for business dealings at usual
trade terms and conditions. |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – June 30, 2012
|
Country Name |
Previous Rating (31.03.2012) |
Current Rating (30.06.2012) |
|
|
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
INDIAN ECONOMIC OVERVIEW
India is developing into an open-market economy, yet traces
of its past autarkic policies remain. Economic liberalization, including
industrial deregulation, privatization of state-owned enterprises, and reduced controls
on foreign trade and investment, began in the early 1990s and has served to
accelerate the country's growth, which has averaged more than 7% per year since
1997. India's diverse economy encompasses traditional village farming, modern
agriculture, handicrafts, a wide range of modern industries, and a multitude of
services. Slightly more than half of the work force is in agriculture, but
services are the major source of economic growth, accounting for more than half
of India's output, with only one-third of its labor force. India has
capitalized on its large educated English-speaking population to become a major
exporter of information technology services and software workers. In 2010, the
Indian economy rebounded robustly from the global financial crisis - in large
part because of strong domestic demand - and growth exceeded 8% year-on-year in
real terms. However, India's economic growth in 2011 slowed because of
persistently high inflation and interest rates and little progress on economic
reforms. High international crude prices have exacerbated the government's fuel
subsidy expenditures contributing to a higher fiscal deficit, and a worsening
current account deficit. Little economic reform took place in 2011 largely due
to corruption scandals that have slowed legislative work. India's medium-term
growth outlook is positive due to a young population and corresponding low
dependency ratio, healthy savings and investment rates, and increasing
integration into the global economy. India has many long-term challenges that
it has not yet fully addressed, including widespread poverty, inadequate
physical and social infrastructure, limited non-agricultural employment
opportunities, scarce access to quality basic and higher education, and
accommodating rural-to-urban migration.
|
Source
: CIA |
EXTERNAL AGENCY RATING
|
Rating Agency Name |
CRISIL |
|
Rating |
Cash Credit : (CRISIL) AA |
|
Rating Explanation |
Having high degree of safety regarding timely
servicing of financial obligation carry very low credit risk. |
|
Date |
December 2010 |
RBI DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available RBI Defaulters’ list.
EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of
31-03-2012.
LOCATIONS
|
Registered/ Head Office : |
"PRAJ
HOUSE", Bavdhan, Pune 411
021, |
|
Tel. No.: |
91-20-22951511/ 22952214/ 39806666/ 22905000/ 39806314 |
|
Fax No.: |
91-20-22951718/ 22951515 |
|
E-Mail : |
|
|
Website : |
|
|
|
|
|
Regional Office: |
Located at:
|
|
|
|
|
Factory 1 : |
Sanaswadi Unit Gat No.748, Opposite Metacolour, Sanaswadi, Taluka Shirur, District Pune 412 207, Maharashtra, India (Unit 1, 2 and 3) |
|
Tel. No.: |
91-2137-252328/ 252913 |
|
Fax No.: |
91-2137-252911 |
|
|
|
|
Factory 2 : |
Gat No.745, Opposite Metacolour, Sanaswadi, Taluka Shirur, District Pune 412 207, Maharashtra, India |
|
|
|
|
Factory 4: |
Kandla SEZ Unit Plot No. 307 to 314, Kandla SEZ, Gandhidham, Kutch 370
230, Gujarat, |
|
Tel. No.: |
91-2836-253460/ 253461 |
|
Fax No.: |
91-2836-253462 |
|
|
|
|
Export Oriented Unit |
Kandla SEZ: Gandhidham, Kutch – 370230, |
|
|
|
|
R and D Centre |
Matrix - The |
|
Tel. No.: |
91-20-66754000/ 22922001 |
|
Fax No.: |
91-20-22922004 |
|
|
|
|
Branches: |
Located at
|
|
|
|
|
International
Office : |
Located at:
|
DIRECTORS
AS ON 31.03.2012
|
Name : |
Mr. Pramod Chaudhari |
|
Designation : |
Executive
Chairman |
|
|
|
|
Name : |
Mr. Gajanan Nabar |
|
Designation : |
Chief Executive Officer and Managing Director |
|
Date of Birth/Age : |
16.11.1963 |
|
Date of Appointment : |
15.11.2010 |
|
Qualification : |
Master’s degree
in Organic Chemistry and in Management from |
|
|
|
|
Name : |
Mr. Berjis Desai |
|
Designation : |
Director |
|
Date of Birth/Age : |
02.08.1956 |
|
Date of Appointment : |
27.08.1993 |
|
Qualification : |
LLB. Masters
degree in law from Cambridge University |
|
|
|
|
Name : |
Mr. Sivaramakrishnan
Iyer |
|
Designation : |
Director |
|
Date of Birth/Age : |
28.07.1967 |
|
Date of Appointment : |
17.04.2003 |
|
Qualification : |
Bachelor’s degree in Commerce and Chartered Accountant. |
|
|
|
|
Name : |
Mr. Parimal Chaudhari |
|
Designation : |
Director |
|
Date of Birth/Age : |
01.08.1956 |
|
Date of Appointment : |
21.07.2006 |
|
Qualification : |
Post Graduate
degree in Journalism and Communications from |
|
|
|
|
Name : |
Mr. Kishor Chaukar |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Utpal Sheth |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Rajiv Maliwal |
|
Designation : |
Non-Executive Director |
|
|
|
|
Name : |
Mr. Prakash Kulkarni |
|
Designation : |
Non-Executive Director |
|
Date of Birth/Age : |
09.06.1947 |
|
Date of Appointment : |
11.10.2010 |
|
Qualification : |
Graduate
Engineer from VJTI and an alumni of |
KEY EXECUTIVES
|
Name : |
Mr. Dattatraya
Nimbolkar |
|
Designation : |
Company Secretary |
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 |
|
|
|
|
|
|
|
|
51710400 |
29.14 |
|
|
51710400 |
29.14 |
|
|
|
|
|
Total shareholding of Promoter and Promoter Group (A) |
51710400 |
29.14 |
|
(B) Public Shareholding |
|
|
|
|
|
|
|
|
296500 |
0.17 |
|
|
7797127 |
4.39 |
|
|
28536547 |
16.08 |
|
|
36630174 |
20.64 |
|
|
|
|
|
|
22624859 |
12.75 |
|
|
|
|
|
|
32709762 |
18.43 |
|
|
26663782 |
15.02 |
|
|
7126102 |
4.02 |
|
|
1196460 |
0.67 |
|
|
4247392 |
2.39 |
|
|
60000 |
0.03 |
|
|
1622250 |
0.91 |
|
|
89124505 |
50.22 |
|
Total Public shareholding (B) |
125754679 |
70.86 |
|
Total (A)+(B) |
177465079 |
100.00 |
|
(C) Shares held by Custodians and against which Depository Receipts
have been issued |
0 |
0.00 |
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
Total (A)+(B)+(C) |
177465079 |
0.00 |
(1) Indian
Individuals / Hindu Undivided Family
Individual shareholders holding nominal share
capital up to Rs. 0.100 millionBUSINESS DETAILS
|
Line of Business : |
Subject is engaged
in the business of Process and Project Engineering. |
GENERAL INFORMATION
|
No. of Employees : |
800 (approximately) |
|
|
|
|
Bankers : |
·
Bank of Maharashtra ·
The Royal Bank of Scotland HSBC Limited |
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
B. K.
Khare and Company Chartered
Accountants |
|
Address : |
706/ 708, Sharda Chambers, New Marine
Lines, Mumbai - 400 020, Maharashtra, India |
|
Tel. No.: |
91-22-22000607/ 7318/ 6360/ 66315835/ 36 |
|
Fax No.: |
91-22-22003476 |
|
E-Mail : |
|
|
|
|
|
Internal
Auditors : |
Khare Deshmukh and Company Chartered Accountants |
|
|
|
|
Subsidiaries : |
·
Pacecon Engineering Projects Limited ·
Praj Far East Company Limited ·
BioCnergy Europa B.V. ·
Praj Jaragua Bioenergia S.A. ·
Praj Americas Inc. (from June 2009) ·
Praj Industries (Africa) Pty. Limited ·
Neela Systems Limited* * The Company has acquired 50.20% stake in the company as per
agreement dated 6th January, 2012 |
CAPITAL STRUCTURE
AS ON 31.03.2011
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
450,000,000 |
Equity Shares |
Rs. 2/- each |
Rs. 900.000 Millions |
|
|
|
|
|
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
179,548,000 |
Equity Share |
Rs. 2/- each |
Rs. 359.096
Millions |
|
|
|
|
|
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
359.096 |
369.557 |
369.477 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
5148.677 |
5219.931 |
4953.857 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
5507.773 |
5589.488 |
5323.334 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
0.000 |
0.000 |
0.000 |
|
|
2] Unsecured Loans |
0.000 |
0.000 |
0.000 |
|
|
TOTAL BORROWING |
0.000 |
0.000 |
0.000 |
|
|
DEFERRED TAX LIABILITIES |
131.903 |
143.167 |
153.421 |
|
|
|
|
|
|
|
|
TOTAL |
5639.676 |
5732.655 |
5476.755 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
1646.046 |
1418.863 |
1374.239 |
|
|
Capital work-in-progress |
98.086 |
139.054 |
67.013 |
|
|
|
|
|
|
|
|
INVESTMENT |
2249.341 |
2640.419 |
2771.124 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
Non- Current Assets |
100.020 |
100.015 |
|
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
740.835
|
628.542 |
282.948
|
|
|
Sundry Debtors |
2576.110
|
1987.232 |
1124.849
|
|
|
Cash & Bank Balances |
1171.762
|
1275.185 |
1261.064
|
|
|
Other Current Assets |
689.020
|
253.498 |
411.932
|
|
|
Loans & Advances |
1577.719
|
1243.632 |
1220.454
|
|
Total
Current Assets |
6755.446
|
5388.089 |
4301.247 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
1397.677
|
1282.650 |
662.691 |
|
|
Other Current Liabilities |
2178.675
|
1655.417 |
1544.133
|
|
|
Provisions |
1632.911
|
1015.718 |
830.044
|
|
Total
Current Liabilities |
5209.263
|
3953.785 |
3036.868 |
|
|
Net Current Assets |
1546.183
|
1434.304 |
1264.379 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
5639.676 |
5732.655 |
5476.755 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
8804.441 |
5529.310 |
6022.840 |
|
|
|
Other Income |
432.295 |
247.739 |
424.517 |
|
|
|
TOTAL (A) |
9236.736 |
5777.049 |
6447.357 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of materials consumed |
5487.553 |
3314.988 |
|
|
|
|
(Increase)/Decrease in inventories of Finished Goods and
Work-in-Progress |
(30.151) |
(106.089) |
|
|
|
|
Employee Benefit Expenses |
884.587 |
718.858 |
|
|
|
|
Other Expenses |
1632.340 |
1138.457 |
|
|
|
|
TOTAL (B) |
7974.329 |
5066.214 |
5108.294 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
1262.407 |
710.835 |
1339.063 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
1.448 |
0.059 |
3.300 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
1260.959 |
710.776 |
1335.763 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
141.730 |
111.356 |
105.110 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
1119.229 |
599.420 |
1230.653 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
460.984 |
64.695 |
91.806 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
658.245 |
534.725 |
1138.847 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
3462.571 |
3251.936 |
2538.234 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
|
53.500 |
114.000 |
|
|
|
Dividend |
|
232.821 |
265.947 |
|
|
|
Tax on Dividend |
|
37.769 |
45.198 |
|
|
BALANCE CARRIED TO
THE B/S |
N.A. |
3462.571 |
3251.936 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
FOB value of Export |
3513.562 |
1625.624 |
2403.867 |
|
|
|
Design and engineering services, software
and consultancy |
119.986 |
212.428 |
272.069 |
|
|
TOTAL EARNINGS |
3633.548 |
1838.052 |
2675.936 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
409.559 |
316.621 |
166.906 |
|
|
|
Capital Goods |
82.705 |
50.904 |
5.617 |
|
|
|
Components and spares parts |
754.056 |
284.035 |
326.721 |
|
|
TOTAL IMPORTS |
1246.320 |
651.560 |
499.244 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
|
|
|
|
|
|
Basic
|
3.58 |
2.89 |
6.18 |
|
|
|
Diluted
|
3.57 |
2.89 |
6.16 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2012 |
|
|
1st Quarter |
|
Sales Turnover |
1639.300 |
|
Total Expenditure |
1512.900 |
|
PBIDT (Excl
OI) |
126.400 |
|
Other Income |
60.100 |
|
Operating
Profit |
186.500 |
|
Interest |
3.300 |
|
Exceptional
Items |
0.000 |
|
PBDT |
183.200 |
|
Depreciation |
33.000 |
|
Profit
Before Tax |
150.200 |
|
Tax |
29.600 |
|
Provisions and contingencies |
0.000 |
|
Reported PAT |
120.600 |
|
Extraordinary Items |
0.000 |
|
Prior Period Expenses |
0.000 |
|
Other Adjustments |
0.000 |
|
Net Profit |
120.600 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
PAT / Total Income |
(%) |
7.13 |
9.26 |
17.66 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
12.71 |
10.84 |
20.43 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
13.32 |
8.81 |
21.68 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.20 |
0.11 |
0.23 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.95 |
0.71 |
0.57 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.30 |
1.36 |
1.42 |
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 |
Yes |
|
8] |
No. of employees |
Yes |
|
9] |
Name of person contacted |
No |
|
10] |
Designation of contact
person |
No |
|
11] |
Turnover of firm for last
three years |
Yes |
|
12] |
Profitability for last
three years |
Yes |
|
13] |
Reasons for variation
<> 20% |
-- |
|
14] |
Estimation for coming
financial year |
No |
|
15] |
Capital in the business |
Yes |
|
16] |
Details of sister
concerns |
Yes |
|
17] |
Major suppliers |
No |
|
18] |
Major customers |
No |
|
19] |
Payments terms |
No |
|
20] |
Export / Import details
(if applicable) |
No |
|
21] |
Market information |
-- |
|
22] |
Litigations that the firm
/ promoter involved in |
-- |
|
23] |
Banking Details |
Yes |
|
24] |
Banking facility details |
No |
|
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] |
Date of Birth of
Proprietor/Partner/Director, if available |
Yes |
|
32] |
PAN of
Proprietor/Partner/Director, if available |
No |
|
33] |
Voter ID No of
Proprietor/Partner/Director, if available |
No |
|
34] |
External Agency Rating,
if available |
Yes |
NATURE OF BUSINESS
Subject is a public company domiciled in India
and incorporated under the provisions of the Companies Act, 1956. The Company is
engaged in the business of Process and project Engineering. The Company caters
to both domestic and International markets. Further, the Company also provides
design and engineering services.
MANAGEMENT DISCUSSION AND ANALYSIS
OVERVIEW
During the fiscal, the emerging economies have shown resilience in the face of a challenging global environment. While there was some intermittent improvement in the US economy evident from the reported statistics a complete recovery is yet to take shape. The intensification of the debt crisis in Europe has had a far reaching impact across all of the Eurozone. The world economy can only reach its true potential if USA and EU nations are able to reverse their downslide.
The Company has a strong presence in the emerging economies. This is reflected in the Company`s performance with a 150% increase in overseas revenues. The Company has references in more than 60 countries around the world.
Against this, the domestic market has witnessed a number of policy and fiscal issues which have started slowing down the pace of investments.
The Company has diversified into synergistic businesses wherein it serves a multitude of industries. This not only de-risks the organization, but also provides wider experience base for future expansion in new business areas. This is in line with the Company`s stated objectives of 25% of its revenues (to be gradually stepped up further) coming from non-ethanol businesses by 2013.
FINANCIAL REVIEW:
The Company delivered the highest top-line performance ever during the fiscal. The Company achieved Rs. 8,805 Mn revenue in terms of stand-alone financials with consolidated turnover at Rs. 10,031 Mn. The growth in standalone sales revenues was 60% over previous fiscal. This increase was due to higher income from overseas business and additional revenue stream from non-ethanol businesses. EBIDTA (excluding other income) improved 79% over the previous fiscal at Rs. 830 Mn (Rs. 463 Mn). PBT was Rs. 1,119 Mn and PAT at Rs. 658 Mn. The Company remains debt free and cash positive. EPS for the fiscal has grown from Rs. 2.89 to Rs. 3.58. Net Capex for the year was Rs. 360 Mn.
INDUSTRY STRUCTURE:
ALCOHOL/ETHANOL
INDUSTRY:
The year 2011-12 has been a watershed year in the history of ethanol business, especially in the US. The expiration of Volumetric Ethanol Excise Tax Credit or VEETC ($0.45 per gallon) and abolishment of import duties on fuel ethanol into the USA has a far reaching implication, one of them being the fast tracking of second generation ethanol process and scale up. Over the last year, they have seen announcements of new partnership, scale up of capacities and other activities around this.
The Company also has aspirations to be a significant technology player in this space. With in-principle consent of the Board for stepping up the efforts towards commercial scale demo plant for lignocellulosic biomass to ethanol plant, we expect to create a significant position for ourselves in advanced biofuels.
The past year has also seen global ethanol capacities being utilized to a larger extent. This gives a sense that new capacities should start scaling around the world. Some of the regions of interest are likely to be South East Asia and South Central America with country specific mandates in Philippines, Vietnam, Australia, Colombia, Argentina and Peru. In the case of first generation ethanol, it is apparent that the center of gravity has shifted away from the USA.
India continues to present a strong beverage alcohol plants opportunities with a growth rate of 10-12% (5 Year CAGR). The Company has over 70% market share in India (on installed base).
BREWERY/BEER
INDUSTRY:
Currently, the Company serves the market for brewery plants in India. Practically, every major beer producer has set up operations in India. With annual per capita beer consumption at two liters, the Indian beer industry is growing at the rate of 11-12% CAGR for the past five years. Growing disposable income, improvements in the quality of beer, steadily growing beer-consuming population base, changing climatic factors and evolving life style are the factors that have an impact on the growth of the beer industry.
The Company has been investing into serving the changing expectations of beer producers.
Recently, the Company commissioned the largest brewery in India with the brew length of 300 hectoliter and total capacity of one million hectoliter per year.
The Company is considered to be an integrated brewery plant supplier and is also working towards forging partnerships in this space to bring the best of the brewery experience to its customers in India and other emerging markets.
WATER AND WASTEWATER
TREATMENT:
Water scarcity, environmental concerns and challenges in manufacturing processes in various industries and pressure on municipal services are the key drivers for this business. Over a period of time, with increasing industrial activities across certain regions, the need for reduction, recycle and reuse of treated wastewater and zero liquid discharge will clearly enhance technology play in the water space.
The Company introduced this business line a year ago and has already demonstrated its capabilities by offering critical technologies and systems for wastewater treatment to a number of industries including the Zero Liquid Discharge System for textile effluent at Thirupur textile belt. This plant is successfully commissioned.
Also, the Company plans to build sizable overseas opportunities and has identified regions of interest beyond India wherein it can offer value added services.
With the acquisition of Neela Systems, the Company can now be looked upon as a significant player in niche segments like pharmaceuticals, food and beverages, biotech and cosmetics.
CRITICAL PROCESS
EQUIPMENT:
With more and more sourcing of process equipment from India, they are seeing an uptick in the demand for critical equipments and systems that adhere to specific standards required in oil and gas, chemicals, fertilizers and several other industries.
The Company has been certified for ASME U, U2 and H stamp and CE marked equipments. The Company also has the capability to handle various metals and global design specifications and has moved up the value chain to offer bundled solutions which go beyond mere fabrication. It now serves customers in South East Asia and Middle East with possible future expansion into South and North America.
The Company has set up another manufacturing unit at Kandla (SEZ Unit II) which can fabricate high thickness vessels for industries with such requirement. This has augmented the Company`s position as a competitive supplier in the international market.
BIOTECH PRODUCTS:
This business was introduced for its potential to deliver recurring revenue. Currently, the Company is supplying biotech based consumables like `fermentation performance enhancers` for the distillery industry.
A GMP based manufacturing facility has been commissioned for this purpose. Located near Pune, this facility will look to scale up with other biotech products that will expand the portfolio and can serve industries outside the ethanol and sugar sector. The Company has identified Animal Feed Additives including amino acids and probiotics as an area of interest and is in the process of charting out a marketing plan.
Apart from this, the Company`s R and D Center, Praj Matrix, is also working on other biotech products which can either be manufactured and marketed by the Company or licensed for production to the industry. The biotech production unit will be aligned for these product lines as well.
In time to come, they expect a bouquet of bio-based products for various applications.
ORGANIZATIONAL
INITIATIVES:
Bringing back the level of profits in line with earlier periods is being pursued aggressively. The Company has undertaken several programs which include the flagship Lean Management Program at the manufacturing facility. This will not only ensure cost reduction but also efficiency improvement and value enhancement for customers. It is expected to make the Company more competitive. The Company has set up two Centers of Excellence - one for Innovation and Applied Technology and another for Engineering - in line with the objectives of the Company to enhance its competitive edge.
IT AND
INFRASTRUCTURE:
The physical operations are supported by a robust IT infrastructure and an in-house data centre. The company is making continuous investments in Business Process Automation and Information Technology. Plans are underway to implement and leverage current technology services this year to enhance existing infrastructure capacity, data security, data centralization and business process controls. This will help the company improve its efficiency in order to gain in the market, sustain growth and secure its operations. Specifically, the Company has undertaken the following:
1) Server Virtualization: Consolidates and reduces server footprint and help IT team do more with same team.
2) Internally developed Business Process automation on Intranet, private cloud: Improves operational efficiencies and optimizes infrastructure cost.
3) Public Cloud service adoption for payroll has also ushered better efficiencies and control.
The Company will increasingly use virtual environment for servers and desktops which will have multiple benefits of hardware optimization, scalability, standardization and efficient administration. All this will also assist with better decision support systems.
AWARDS, CERTIFICATIONS
AND RECOGNITION:
The manufacturing operations of the Company are recognized for its quality delivery alongwith safety compliance. In recognition,
* The Company received re-certification for its Sanaswadi manufacturing facility for U and H stamps. Certification for the new Kandla manufacturing facility for U and U2 stamps is in process. The ISO 9001-2008 certificate was also renewed in the FY 2011-12. The Company has also been awarded ISO 9001-14000 and OHSAS for Safety and Environment.
* Kandla Special Economic Zone, India conferred the Highest Exports Award in the category of Engineering and Metallurgical Products to the Kandla manufacturing unit.
* Praj has won the Export Promotion Council for EOU and SEZ (EPCES) Export Award or outstanding export performance from the Category-II Product Specific SEZ - MSME.
The Company is a leading player in the industrial biotechnology and renewable energy field. In recognition of the Company`s contributions;
* The Association of Biotechnology Led Enterprises (ABLE) elected Mr. Pramod Chaudhari as a member of the association for another three years term. Praj Matrix actively participates in the forum.
* Mr. Pramod Chaudhari has been elected as the Member of the World Council of Industrial Biotechnology (WCIB) recently. The WCIB is established to share experts` opinions to promote appropriate policies, research and business directions on industrial biotechnology. World Economic Forum (WEF, Geneva, Switzerland) is a founding member of this organization.
* Mr. Pramod Chaudhari is re-nominated as Co-Chairman of the CII National Renewable Energy Committee.
* Government of Karnataka conferred The Bio-Excellence Award for the year 2012 on your Company in recognition of the outstanding contribution to the BioIndustrial Sector.
* Praj Matrix - The Innovation Centre won the "Green Innovation Award" for Outstanding Research in the field of Green Chemistry and Engineering in the category of the Most Promising Technologies.
* CRISIL has reaffirmed its rating on the Company. The Cash Credit Facility has been assigned AA/Stable rating; Letter of Credit and Bank Guarantee facility has been assigned CRISIL A1 + rating and Proposed Long Term Bank Facility is assigned AA/Stable rating.
FUTURE OUTLOOK:
The Company`s growth plans are based on leveraging its process engineering experience and venturing into other synergistic businesses. The focus in the near term will be on progressing the technology for second generation biofuels to commercial scale and scaling the non-ethanol businesses.
The Company has also embarked upon developing a blue print for medium term strategic plan which will not only focus on how to scale up the current businesses but also examine adjacent spaces for diversification opportunities. This exercise is expected to be completed by end of fiscal 2012-13.
STANDALONE
UNAUDITED FINANCIAL RESULTS FOR THE QUARTER ENDED ON 30TH JUNE 2012
(Rs. in millions)
|
Particular |
Quarter Ended on |
|
|
30.06.2012 (Unaudited) |
|
Income from Operations |
|
|
Net Sales/Income from Operations |
1639.300 |
|
Other Operating Income |
-- |
|
Total Income from
operations (net) |
1639.300 |
|
|
|
|
Expenses |
|
|
(a) Cost of material consumed |
891.800 |
|
(b) Purchase of stock in trade |
-- |
|
(c) Changes in inventories of Finished Goods, Work in progress and Stock in trade |
7.300 |
|
(d) Employee benefit expenses |
244.000 |
|
(e) Depreciation and amortization expenses |
33.000 |
|
(f) Exchange (gain)/ loss |
(19.500) |
|
(g) Other Expenses |
369.800 |
|
Total Expenses |
1526.400 |
|
Profit from Operations
before Other Income, Finance costs and Exceptional item |
112.900 |
|
Other Income |
40.600 |
|
Profit/ Loss from
Ordinary Activities before Finance costs and Exceptional item |
153.500 |
|
Finance costs |
3.300 |
|
Profit/ Loss from
Ordinary Activities after Finance costs but Exceptional item |
150.200 |
|
Exceptional
item |
-- |
|
Profit/ Loss from Ordinary Activities
before tax |
150.200 |
|
Tax Expenses |
29.600 |
|
Net Profit/ Loss from Ordinary Activities
after tax |
120.600 |
|
Extraordinary
Items |
-- |
|
Net Profit for the period |
120.600 |
|
Paid- up
Equity Share Capital (Face value
of the share – Rs. 10) |
354.900 |
|
Reserves
excluding revaluation reserves as per balance sheet of Previous Accounting
Year |
|
|
Earnings per
share (before extraordinary items) (of Rs. 10/-
each) (not annualized) -
Basic |
0.68 |
|
- Diluted |
0.68 |
|
Earnings per share
(after extraordinary items) (of Rs. 10/-
each) (not annualized) - Basic |
0.68 |
|
- Diluted |
0.68 |
|
|
|
|
PARTICULARS OF SHAREHOLDING |
|
|
1. Public
shareholding |
|
|
Number of
Shares |
125754679 |
|
Percentage of Shareholding |
70.86% |
|
2. Promoters
and promoter group shareholding |
|
|
a)
Pledged/Encumbered |
|
|
- Number of Shares |
Nil |
|
- Percentage of Shares (as a % of the Total Shareholding
of promoter and promoter group) |
Nil |
|
- Percentage of Shares (as a % of the Total Share Capital
of the Company) |
Nil |
|
|
|
|
Non - encumbered |
|
|
- Number of
Shares |
51710400 |
|
- Percentage
of Shares (as a % of
the total shareholding of promoter and promoter
group) |
100% |
|
- Percentage
of Shares (as a % of
the total share capital of the company) |
29.14% |
|
|
Particulars |
Quarter Ended 31st
March 2012 |
|
B |
Investor
complaints |
|
|
|
Pending at the beginning of the quarter |
Nil |
|
|
Received during the quarter |
2 |
|
|
Disposed of during the quarter |
2 |
|
|
Remaining unresolved at the end of the quarter |
Nil |
Notes:
1. The above results were reviewed by the Audit Committee and approved by
the Board of Directors at its meeting held on 20th July 2012. The
prior year comparitives are regrouped / reclassified wherever necessary to
conform to current period presentation.
2. The statutory Auditors have carried out a limited review of the above
financial results.
3. In the previous quarter ended March 2012 the Company made a prudential
provision for estimated liability arising out of proceedings conducted by the
Income Tax Department under Section 132 of the Income Tax Act, 1961 on the
basis of information and facts available with the Company and applicable legal
provisions.
The proceedings thereafter have commenced but no order/demand has till
date received by the Company in the current
quarter and therefore no adjustment has been made to the amount provided for
tax. The company has however paid an amount of Rs. 25.000 Million still date
against a likely demand.
4. The company announced a buy-back of equity shares with effect from 26th
December 2011 as per section 77A of the Companies Act, 1956 which was completed
on 24th April 2012.
CONTINGENT LIABILITIES
(Rs. in millions)
|
Particulars |
31.03.2012 |
31.03.2010 |
|
Claims against Company not acknowledged as debts (primarily relating
to performance related claims filed by customers) |
35.679 |
141.128 |
|
Disputed demands in appeal towards income tax, Service tax and Sales
tax |
1.191 |
39.090 |
|
Guarantee issued in respect of obligations of a subsidiary |
181.773 |
Nil |
|
Unfulfilled Export Obligations under EPCG scheme to be fulfilled over
8 years |
129.711 |
292.064 |
FIXED
ASSETS
·
Technical
Knowhow
·
Software’s
·
Praj Brand
·
Land
(freehold)
·
Buildings
·
Plant and
machinery
·
Computers and
office equipment
·
Vehicles
·
Furniture and
fixtures
5.
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. 54.26 |
|
|
1 |
Rs. 88.15 |
|
Euro |
1 |
Rs. 71.03 |
INFORMATION DETAILS
|
Report Prepared
by : |
BVA |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
8 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
NO |
|
--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 |
|
64 |
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 |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.