MIRA INFORM REPORT
|
Report Date : |
23.02.2013 |
IDENTIFICATION DETAILS
|
Name : |
SUTLEJ TEXTILES AND INDUSTRIES LIMITED |
|
|
|
|
Registered
Office : |
Pachpahar Road, Bhawanimandi – 326502, Kota, Rajasthan |
|
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|
Country : |
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|
|
|
Financials (as
on) : |
31.03.2011 |
|
|
|
|
Date of
Incorporation : |
22.06.2005 |
|
|
|
|
Com. Reg. No.: |
17-020927 |
|
|
|
|
Capital Investment
/ Paid-up Capital : |
Rs. 109.219 Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
L17124RJ2005PLC020927 |
|
|
|
|
TAN No.: [Tax Deduction &
Collection Account No.] |
JDHS07078B |
|
|
|
|
PAN No.: [Permanent Account No.] |
AAJCS1850N |
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|
|
|
Legal Form : |
A Public Limited Liability Company. The Company’s Shares are Listed on
the Stock Exchanges. |
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|
|
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Line of Business
: |
Manufacturer of Synthetic Staple Fibres Yarn, Man made Fibres blended
yarn and Cotton Yarn and Fabrics. |
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|
|
|
No. of Employees
: |
11531 (Approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
A (61) |
|
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 10000000 |
|
|
|
|
Status : |
Good |
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|
|
|
Payment Behaviour : |
Regular |
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|
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Litigation : |
Clear |
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|
Comments : |
Subject is an established company having fine track. Financial
position of the company appears to be sound. Trade relations are reported as
fair. Business is active. Payments are reported to be regular and as per commitment. The company can be considered normal for business dealings at usual
trade firms 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 |
|
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 |
LOCATIONS
|
Registered Office : |
|
|
Tel. No.: |
91-7433-222052/222054/222056/222082/222090 |
|
Fax No.: |
91-7433-222354 |
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E-Mail : |
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|
Website: |
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Corporate Office : |
Solaris-1, D Wing, 4th Floor, opp L&T Gate No-6, Saki
Vihar Road, Powai, Andheri – (East), Mumbai – 400072, Maharashtra. India |
|
Tel. No.: |
91-22-42198800/42198824 |
|
Fax No.: |
91-42198830/31 |
|
E-Mail : |
|
|
|
|
|
Factory 1 : |
Chenab Textile Mills, Kathua – 184102, |
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|
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Factory 2 : |
Damanganga Home Textiles, Bhilad – 396105, |
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Factory 3 : |
Damanganga Garments, Bhilad – 396105, |
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Factory 4 : |
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Factory 5 : |
Rajasthan Textile Mills, Bhawanimandi – 326502, |
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Factory 6 : |
Rajasthan Textile Mills Pachpahar road Bhawanimandi – 326502, |
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Factory 7 : |
Chenab Textile Mills Kathua – 184102, Jammu and Kashmir - India |
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DIRECTORS
As on 31.03.2011
|
Name : |
Mr. C.S. Nopany |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Mr. J. S. Varshneya |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. S. M. Agarwal |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. U. K. Khaitan |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Amit Dalal |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Rajan A. Dalal |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Ashok Mittal |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Rajiv K. Podar |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Chaturbhuj Singhania |
|
Designation : |
Whole time Director and CFO |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 31.03.2012
|
Category of Shareholders |
No. of Shares |
Percentage of
Holding |
|
(A) Shareholding
of promoters and Promoter Group |
|
|
|
1. Indian |
|
|
|
Individuals / Hindu Undivided Family |
|
|
|
Bodies Corporate |
6974208 |
63.86 |
|
Sub Total (A)
(1) |
6974208 |
63.86 |
|
|
|
|
|
2. Foreign |
--- |
--- |
|
Total Shareholding
of promoters and Promoter Group (A) |
6974208 |
63.86 |
|
|
|
|
|
(B) Public
Shareholding |
|
|
|
1. Institutions |
|
|
|
Mutual Funds / UTI |
|
|
|
Financial Institutions / Banks |
2687 |
0.02 |
|
Central Government/State Government |
|
|
|
Insurance Companies |
179359 |
1.64 |
|
Foreign Institutional Investors |
1000 |
0.01 |
|
Sub Total (B)
(1) |
183046 |
1.68 |
|
|
|
|
|
2. Non
Institutions |
|
|
|
Bodies Corporate |
1898360 |
17.38 |
|
Individual shareholders holding nominal share capital up to Rs. 0.100
million |
1282291 |
11.74 |
|
Individual shareholders holding nominal share capital in excess of Rs.
0.100 million |
565678 |
5.18 |
|
|
|
|
|
Any Others
(specify) |
|
|
|
Non Resident Indians |
18325 |
0.17 |
|
Sub Total (B)
(2) |
3764654 |
34.47 |
|
(B) = (B) (1) +
(B) (2) |
3947700 |
36.14 |
|
|
|
|
|
Shares
held by custodians and against which depository receipts have been
issued (C) |
--- |
--- |
|
|
|
|
|
Total (A) + (B) +(C) |
10921908 |
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer of Synthetic Staple Fibres Yarn, Man made Fibres blended
yarn and Cotton Yarn and Fabrics. |
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Products : |
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PRODUCTION STATUS
As on 31.03.2011
|
Particulars |
31.03.2011 |
|
|
Unit |
|
i) Licensed Capacity - Spindles (Nos.)
- Rotors (Nos.)
- Looms (Nos.) |
Delicensed vide Notification no.477 (E) Dated July 27, 1991 of the Ministry
of Industry |
|
Installed Capacity – (Certified by the
management) Bhawanimandi Unit:
|
82384 336 |
|
Kathua Unit:
|
170616 -- |
|
Daheli Unit: (a) Damanganga Fabrics
(b) Damanganga Garment #
(c) Damanganga Home Furnishing
|
60 20000000 527000 1976010 |
|
|
|
GENERAL INFORMATION
|
Customer: |
Raymonds, Harry’s
Collection, Digjam, Marks and Spencer, JC Penney, Next, ASDA, Grasim,
Donear, Siyaram’s, Arrow, Sears, Kohls, Arvind
and
John Miller, among others. |
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No. of Employees : |
11531 (Approximately) |
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Bankers : |
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(Rs.
In Millions) |
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Facilities : |
|
|
|
|
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Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
Singhi and Company Chartered Accountants |
|
Address : |
401 & 408, Pragati House 47- 48, Nehru Place, New Delhi – 110019,
India |
|
Branch Auditors : |
|
|
Name : |
S. R. Batliboi and Company Chartered Accountants |
|
Address : |
Golf View, Corporate Tower 3 Sector 43, Sector Road, Gurgaon – 122002,
Haryana, India |
|
|
|
CAPITAL STRUCTURE
As on 31.03.2011
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
25000000 |
Equity Shares |
Rs.10/- each |
Rs. 250.000 Millions |
|
5000000 |
Preference Shares |
Rs.10/- each |
Rs. 50.000 Millions |
|
|
|
|
|
|
|
Total |
|
Rs. 300.000
Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
10921908 |
Equity Shares |
Rs.10/- each |
Rs. 109.219
Millions |
|
|
|
|
|
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
109.219 |
109.219 |
109.219 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
2395.569 |
1347.351 |
1116.049 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
2504.788 |
1456.570 |
1225.268 |
|
|
|
|
|
|
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
7723.158 |
8510.315 |
7939.890 |
|
|
2] Unsecured Loans |
429.811 |
287.675 |
620.869 |
|
|
TOTAL BORROWING |
8152.969 |
8797.990 |
8560.759 |
|
|
DEFERRED TAX LIABILITIES |
498.996 |
196.685 |
174.823 |
|
|
Deferred
Government subsidies |
13.575 |
17.818 |
14.022 |
|
|
|
|
|
|
|
|
TOTAL |
11170.328 |
10469.063 |
9974.872 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
6054.128 |
6433.470 |
4653.516 |
|
|
Capital work-in-progress |
92.608 |
40.175 |
2172.400 |
|
|
|
|
|
|
|
|
INVESTMENT |
16.507 |
4.507 |
4.234 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
3420.107
|
2841.497
|
2017.383 |
|
|
Sundry Debtors |
1326.491
|
958.164
|
715.911 |
|
|
Cash & Bank Balances |
46.441
|
67.478
|
85.768 |
|
|
Other Current Assets |
571.638
|
545.729
|
562.809 |
|
|
Loans & Advances |
477.826
|
199.001
|
315.831 |
|
Total
Current Assets |
5842.503
|
4611.869 |
3697.702 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
|
|
|
|
|
Other Current Liabilities |
633.687
|
527.494
|
475.755 |
|
|
Provisions |
201.731
|
93.464
|
77.225 |
|
Total
Current Liabilities |
835.418
|
620.958 |
552.980 |
|
|
Net Current Assets |
5007.085
|
3990.911
|
3144.722 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
11170.328 |
10469.063 |
9974.872 |
|
%2023-Feb-2013_files/image001.gif){kind=small}
PROFIT
& LOSS ACCOUNT
|
|
PARTICULARS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
15816.474 |
11469.149 |
8510.263 |
|
|
|
Other Income |
333.016 |
298.270 |
220.930 |
|
|
|
TOTAL (A) |
16149.490 |
11767.419 |
8731.193 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Raw materials consumed |
7792.488 |
5990.725 |
4749.939 |
|
|
|
Goods purchase for resale |
1958.184 |
896.149 |
158.175 |
|
|
|
Personnel expenses |
1073.899 |
982.329 |
739.123 |
|
|
|
Operating and other expenses |
2833.010 |
2547.662 |
2229.313 |
|
|
|
Increase/decrease in inventories |
(238.965) |
(191.520) |
297.630 |
|
|
|
Director’s Fees and Commission |
1.945 |
1.118 |
0.470 |
|
|
|
TOTAL (B) |
13420.561 |
10226.463 |
8174.650 |
|
|
|
|
|
|
|
|
Less |
PROFI/LOSS
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
2728.929 |
1540.956 |
556.543 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
572.265 |
528.651 |
431.980 |
|
|
|
|
|
|
|
|
|
|
PROFI/LOSS
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
2156.664 |
1012.305 |
124.563 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
678.620 |
669.094 |
543.365 |
|
|
|
|
|
|
|
|
|
|
PROFI/LOSS
BEFORE TAX (E-F) (G) |
1478.044 |
343.211 |
(418.802) |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
334.623 |
80.069 |
(117.347) |
|
|
|
|
|
|
|
|
|
|
PROFI/LOSS AFTER
TAX (G-H) (I) |
1143.421 |
263.142 |
(301.455) |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
442.145 |
240.843 |
555.076 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
120.000 |
30.000 |
0.000 |
|
|
|
Dividend |
81.914 |
27.305 |
10.922 |
|
|
|
Tax on Dividend |
13.289 |
4.535 |
1.856 |
|
|
BALANCE CARRIED
TO THE B/S |
1370.363 |
442.145 |
240.843 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
5130.132 |
3001.901 |
1694.177 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
173.399 |
126.385 |
88.831 |
|
|
|
Yarn Purchases |
9.031 |
0.000 |
0.000 |
|
|
|
Stores & Spares |
44.574 |
45.766 |
33.168 |
|
|
|
Capital Goods |
93.430 |
37.245 |
131.050 |
|
|
TOTAL IMPORTS |
320.434 |
209.396 |
253.049 |
|
|
|
|
|
|
|
|
|
|
Earnings/Loss
Per Share (Rs.) |
104.69 |
24.09 |
(27.60) |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2011 (1st Quarter) |
30.09.2011 (2nd Quarter) |
31.12.2011 (3rd Quarter) |
|
Net Sales |
4198.400 |
4202.700 |
3587.600 |
|
Total Expenditure |
3737.200 |
3816.800 |
3213.200 |
|
PBIDT (Excl OI) |
461.200 |
385.900 |
374.400 |
|
Other Income |
46.100 |
35.000 |
33.000 |
|
Operating Profit |
507.300 |
420.900 |
407.400 |
|
Interest |
175.300 |
164.600 |
156.300 |
|
Exceptional Items |
0.000 |
0.000 |
0.000 |
|
PBDT |
332.000 |
256.300 |
251.100 |
|
Depreciation |
171.400 |
174.000 |
173.500 |
|
Profit Before Tax |
160.600 |
82.300 |
77.600 |
|
Tax |
24.100 |
16.000 |
14.700 |
|
Provisions and contingencies |
0.000 |
0.000 |
0.000 |
|
Profit After Tax |
136.500 |
66.300 |
62.900 |
|
Extraordinary Items |
0.000 |
0.000 |
0.000 |
|
Prior Period Expenses |
0.000 |
0.000 |
0.000 |
|
Other Adjustments |
0.000 |
0.000 |
0.000 |
|
Net Profit |
136.500 |
66.300 |
62.900 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
PAT / Total Income |
(%) |
7.08
|
2.23 |
(3.45) |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
9.34
|
2.91 |
(4.79) |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
25.30
|
7.44 |
(11.32) |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.59
|
0.23 |
(3.34) |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.33
|
0.42 |
0.45 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
6.99
|
7.42 |
6.68 |
LOCAL AGENCY FURTHER INFORMATION
|
Check List by Info Agents |
Available in Report (Yes / No) |
|
1) Year of Establishment |
Yes |
|
2) Locality of the firm |
Yes |
|
3) Constitutions of the firm |
Yes |
|
4) Premises details |
No |
|
5) Type of Business |
Yes |
|
6) Line of Business |
Yes |
|
7) Promoter’s background |
Yes |
|
8) No. of employees |
Yes |
|
9) Name of person contacted |
No |
|
10) Designation of contact person |
No |
|
11) Turnover of firm for last three years |
Yes |
|
12) Profitability for last three years |
Yes |
|
13) Reasons for variation <> 20% |
-- |
|
14) Estimation for coming financial year |
No |
|
15) Capital in the business |
Yes |
|
16) Details of sister concerns |
Yes |
|
17) Major suppliers |
No |
|
18) Major customers |
No |
|
19) Payments terms |
No |
|
20) Export / Import details (if applicable) |
No |
|
21) Market information |
-- |
|
22) Litigations that the firm / promoter |
-- |
|
23) Banking Details |
Yes |
|
24) Banking facility details |
Yes |
|
25) Conduct of the banking account |
-- |
|
26) Buyer visit details |
-- |
|
27) Financials, if provided |
Yes |
|
28) Incorporation details, if applicable |
Yes |
|
29) Last accounts filed at ROC |
Yes |
|
30) Major Shareholders, if available |
No |
NATURE OF OPERATIONS
The Company is a manufacturer
of Synthetic Staple Fibres Yarn, Man made Fibres blended yarn and Cotton Yarn
and Fabrics. It has two spinning units viz. Rajasthan Textile Mills,
Bhawanimandi (Raj) and Chenab Textile Mills,
Kathua (J and K), one weaving and processing unit viz. Damanganga
Fabrics, one Garments unit viz. Damanganga Garments and one Home Textiles unit
viz. Damanganga Home Textiles at Village Daheli, near Bhilad (Gujarat) .
CAPITAL PROJECTS
The Company invested Rs. 370.000 Millions during the year for capital
projects and intends to further invest Rs. 380.000 Millions in FY 2011-12 and
Rs. 500.000 Millions in FY 2012-13 for modernization, upgradation and balancing
capital equipments.
To reinforce its existing competitive edge, the Company is exploring
various opportunities for expansion and growth.
If undertaken, the expansion will be financed through internal accruals
as well as loans from Banks under TUF Scheme of the Ministry of Textiles,
Government of India, under which an interest subsidy of 4% is provided by the
government.
MANAGEMENT DISCUSSION AND ANALYSIS
BUSINESS OVERVIEW
Sutlej emerged as
an integrated player in the textiles industry with its value chain extending
from yarn to fabrics to garments to home textiles, enabling it to make its presence
in every segment.
|
Units |
Location |
Product |
Capacities |
|
Rajasthan Textile Mills (RTM) |
Bhawanimandi, Rajasthan |
Cotton yarns and man-made fibres yarns |
82384 spindles 336 rotors |
|
Chenab Textile Mills (CTM) |
Kathua, JandK |
Cotton yarns and man-made fibres yarns |
170616 spindles |
|
Damanganga Fabrics (DGF) |
Bhilad, Gujarat |
Fabrics Processed fabrics |
4.9 mn metres p.a. (60 looms) 20 mn metres p.a. |
|
Damanganga Garments |
Bhilad, Gujarat |
Garments |
1.60 mn trousers p.a. |
|
Damanganga Home Textiles |
Bhilad, Gujarat |
Home textile furnishings |
2 mn metres p.a. (24 shuttleless looms) |
GLOBAL ECONOMIC
SCENARIO
The global economy is on the path to growth supported by recovery in the
international and domestic financial flows and higher commodity prices. The
spare capacity in developing countries during the crisis has been reabsorbed
triggering the economic growth.
The real global GDP growth rate in 2010 was 3.9%. Restructuring and right-sizing
in the banking and construction sectors, combined with necessary fiscal and
household consolidation, will continue to drag the economic growth in many high
income economies and developing Europe and Central Asian countries. Thus, the
GDP growth in 2011 is expected to be 3.3%. Here as in 2012 the global economy
would grow by 3.6% as the drag on restructuring activities in the high income
countries eases out. Most of the growth has been on account of strong growth of
domestic demand in the developing nations accounting for about 46% of the
global growth in 2010.
INDIAN ECONOMIC
SCENARIO
The Indian economy grew by 8.6% in 2010-11 as against a growth of 7.4%
during 2009-10. It is further estimated that its growth would bounce back to 9%
during 2011-12. In 2010-11 the manufacturing sector grew by 8.8% with
merchandise exports reaching USD 245 bn and imports being USD 362.3 bn. The
gross fiscal deficit that stood at 6.3% in 2009-10 reduced to around 5.2% in
2010-11 and it is further estimated to reduce to 4.8% in 2011-12.
The investment rate in the country is expected to be 37% in 2010-11 and
37.5% in 2011-12. Whereas the net domestic savings rate is likely to be around
34% in 2010-11 and 34.7% in 2011-12.
GLOBAL TEXTILE
INDUSTRY
OVERVIEW
The global
textiles and apparels trade increased from USD 510 bn in 2009 to USD 612 bn in
2010. There was some correction in this trade in 2008-09 due to the global
economic crisis. However the industry has recovered and is expected to grow
with US, Europe and Japan being the biggest consumers of apparel. It is
estimated that EU`s share is expected to come down to about 10% in next 8-10
years from present share of 30%. On account of lower material and labour costs
in countries such as India, China and other Asian countries.
The replacement of
the MFA (Multi-Fibre Agreement) with ATC (Agreement on Textile and Clothing) in
1995 led to the elimination of quotas over four-step transition phase in a
period of 10 years, post which the global production base shifted to developing
countries and the global trade increased at CAGR of 4.3% from 1995-2004. During
this period the global trade increased from USD 310 bn to USD 450 bn and is
expected to reach USD 805 bn by 2015. Before 1990s the textile production was
primarily from the developed countries likes US, Europe and
Japan. But, since
then the focus has shifted to Asian countries on account of economies of scale.
China accounts for about 30-35% share of the Asia’s textile market and about
25% market share of the global market compared to India’s very low share of
around 4.5% share. The recent currency appreciation in Chinese currency has
created huge opportunity for Indian textile industry.
OVERVIEW
The Indian textile
and apparel industry is estimated to be worth USD 70 bn in 2010 with almost 65%
of the total textile and apparel production being consumed domestically. It
accounts for about 14% of India's total industrial production and contributes
to nearly 10% of total exports. It provides direct employment to about 35 million
people and another 56 million are engaged in allied activities. It accounts for
nearly 4% of India’s GDP. The Indian textile industry is expected to expand
from USD 70 bn to USD 200 bn by 2020.
The industry holds
a significant position in India by catering to the most basic its needs –
clothing. The Indian textiles industry is integrated in terms of being
extensively engaged in the procurement of raw materials right up to the final
production of the actual textile product. The sector targets USD 6 billion
foreign direct investment (FDI) by 2015 to be invested in greenfield units in
textiles machinery, fabric and garment manufacturing, as well as technical
textiles.
The IIP covers
four textile groups –
- Cotton textiles
- Wool, silk and man-made fibre textiles
- Jute and other vegetable fibre textiles (except cotton)
- Textile products (including wearing apparel).
Cotton textiles
production grew by 10.3% during April-February 2010-11 as compared to 5.2%
during April-February 2009-10. Jute textiles productions have also recovered
and grew by 35.8% during April-February 2010-11 as compared to a decline of
23.3% during April-February 2009-10. Textile products grew by 4.9% during
April-February 2010-11 as compared to 9.4% during the corresponding months of
the previous year. In the wool, silk, and man-made fibres segment of textiles
growth has, however, dipped to mere 0.5% during April-February 2010-11 as
compared to 9.9% during April-February 2009-10.
Overall, the
production of textile fabrics has increased by 1.9% during April-October 2010-
11. This is a moderate performance when compared with the robust increase of
8.8% during 2009- 10. The decline in textile fabrics/cloth during the current
financial year has been on account of comparatively lower growth rates in the
production of mill, power loom and hosiery segments.
OUTLOOK
GLOBAL
According to the Clothing Industry Training Authority (CITA) resources
would continue to be the keyword for 2011 in the textile and clothing industry.
Resource implies the hefty challenges with raw materials and manpower. Since
2010, the prices of raw materials, especially cotton, have been surging to an
uncontrollable level. The uncertainty of the raw material issue will linger to
2011 until we have come up with ways to sort it out. Shortage of labor will
also be a challenge for 2011 for some Asian countries.
In 2011, emerging Asian countries, namely India, Bangladesh, Vietnam,
Cambodia, and Pakistan are believed to steal the spotlight of the global
textile industry. According to CITA, the emerging Asian countries will be
playing more significant part in the industry in 2011. Their
price-competitiveness explains it all. Their governments have given their
textile industries enormous support. The historically strong countries like
India and Pakistan also grow natural fibers in quantity that can be compared
with China (for example cotton).
The global textiles fibre and spun yarn market is expected to reach 93
million tonnes and 47.3 million tonnes respectively by 2015 on account of
increasing global textile trade following the expiry of restrictive agreements,
continuing shift in production to low cost countries, restoration of consumer
confidence, recovery in demand for textiles, and rising market potential in
developing regions.
The global per capita fibre consumption is expected to grow steadily in
the long-term up to 11-12 kg per capita by 2025, which means additional fibre
consumption of about 20 million tonnes would be required. It is expected that
the global textiles and apparels industry would grow at a CAGR of 6.3% over the
next 8-10 years to reach USD 1 trillion by 2020.
INDIA
The Indian textile
and clothing industry has tremendous potential to scale new heights in
international as well as domestic markets. A McKinsey Report states that the
Indian textile sector will more than triple from USD 70 bn now to USD 220 bn by
2020, recording an annual growth of about 11%. Experts believe that the golden
era of the Chinese textiles and clothing exports is over and the production
base is gradually shifting from China to India and other low-cost destinations.
Besides, India has burgeoning domestic market. Increase in per capita and
disposable income coupled with favourable demographics provides huge opportunities
to the Indian textiles sector. Thus, there is every reason to be confident
about longterm prospects of the Indian textiles industry.
REVIEW OF
OPERATIONS
During the year the
Company improved its capacity utilisation in the yarns division from 94% in
2009-10 to 95% in 2010-11.
During the year
under report, though raw material prices increased significantly, the Company
was able to augment its topline and margins, through an efficient cost-push to
the end user. The Company’s sales increased 38% from Rs. 11480.000 Millions in
2009-10 to Rs. 15850.000 Millions in 2010-11 with exports constituting 35% of
the total sales. The Company’s gross profit margin also improved from 8.83% in
2009-10 to 13.64% in 2010-11. The Company managed to increase production
volumes and entered into newer regions along with growing presence in the
domestic markets. The Company managed to achieve a spectacular performance
through various initiatives like quality improvement, upgradation to modern
technology, capacity expansion, identifying the right product mix, identifying
the right market and various cost reduction initiatives.
UNAUDITED FINANCIAL RESULTS
FOR THE QUARTER ENDED AND NINE MONTHS ENDED 30th JUNE, 2011
(Rs. in millions)
|
Particulars |
Three Months
Ended 30.06.2011 (Unaudited) |
|
1. a. Sales/Income from Operations |
4149.800 |
|
Less: Excise Duty |
12.200 |
|
Net Sales/Income from Operations |
4137.600 |
|
b. Other Operating income |
60.800 |
|
Total Income
(a+b) |
4198.400 |
|
2. Expenditure |
|
|
a. (Increase)/decrease in stock in trade and work in progress |
(226.600) |
|
b. Consumption of raw material and components |
2542.100 |
|
c. Purchase of traded goods |
452.600 |
|
d. Employee cost |
277.500 |
|
e. Depreciation |
171.400 |
|
f. Other expenditure |
691.600 |
|
g. Total |
3908.600 |
|
3. Profit from Operations before Other income , Interest and
Exceptional Items (1-2) |
289.800 |
|
4. Other Income |
46.100 |
|
5. Profit before Interest and Exceptional Items (3+4) |
335.900 |
|
6. Interest |
175.300 |
|
7. Profit after interest but before Exceptional items (5-6) |
160.600 |
|
8. Exceptional Items |
-- |
|
9. Profit from Ordinary Activities before tax (7+8) |
160.600 |
|
10. Tax expense (Note 2) |
|
|
38.200 |
|
-- |
|
(0.500) |
|
(13.600) |
|
11. Net Profit from Ordinary Activities after tax (9-10) |
136.500 |
|
12. Extraordinary items (net of tax expenses) |
-- |
|
13. Net Profit/(Loss) for the period |
136.500 |
|
14. Paid-up equity share capital ( Face Value Rs. 2 each ) |
-- |
|
15. Reserves excluding Revaluation Reserves as per balance sheet of previous
accounting year |
-- |
|
16. Earnings Per Share ( EPS ) |
|
|
a) Basic and Diluted EPS before Extraordinary items for the period /
year (Not annualized) (Rs.) |
12.50 |
|
b) Basic and Diluted EPS after Extraordinary items for the period /
year (Not annualized) (Rs.) |
-- |
|
17. Public shareholding |
|
|
Number of shares |
3950673 |
|
Percentage of shareholding |
36.17 |
|
18. Promoters and Promoter Group Shareholding |
|
|
a. Pledged / Encumbered |
|
|
Number of shares |
2030000 |
|
Percentage of shares (as a % of the total Shareholding of Promoter and
Promoter group) |
29.12 |
|
Percentage of shares (as a % of the total Share Capital of the
Company) |
18.59 |
|
b. Non-encumbered |
|
|
Number of shares |
4941235 |
|
Percentage of shares (as a % of the total Shareholding of Promoter and
Promoter group) |
70.88 |
|
Percentage of shares (as a % of the total Share Capital of the
Company) |
45.24 |
SEGMENT WISE
REVENUE, RESULTS AND CAPITAL EMPLOYED
(Rs. in millions)
|
Particulars |
Three Months
Ended 30.06.2011 (Unaudited) |
|
1. Segment
Revenue : |
|
|
a)
Yarn |
4045.500 |
|
b)
Fabrics and Apparels |
236.300 |
|
Total |
4281.800 |
|
Less: Inter
Segment Revenue |
83.400 |
|
|
|
|
Total Income
from Operations |
4198.400 |
|
|
|
|
2. Segment
Results : |
|
|
Profit(+)/Loss(-) before interest and tax |
|
|
a)
Yarn |
295.200 |
|
b)
Fabrics and Apparels |
(4.700) |
|
Total |
290.500 |
|
|
|
|
Less : Interest |
175.300 |
|
|
|
|
Add : Other un - allocable income net of un – allocable expenditure |
45.400 |
|
|
|
|
Total
Profit/(Loss) Before Tax |
160.600 |
|
|
|
|
3. Capital
Employed : (segment assets - segment liabilities) |
|
|
a)
Yarn |
8959.200 |
|
b)
Fabrics and Apparels |
1135.900 |
|
Un – allocable Corporate Assets/ (Liabilities) (Net) |
692.300 |
|
Total |
10787.400 |
Note:
1)
The Figures of the previous period / years have
been re-grouped/rearranged and/or recast wherever found necessary.
2)
During the quarter ended 30th june, 2011,
no investor complaint / letter was received. No complaint was pending at the
beginning or at the end of the quarter.
3)
The above results have been subjected to limited
review by the Statutory Auditors; have been reviewed BY THE Audit Committee and
taken on record by the Board of Directors at its meeting held on 27th
July, 2011.
FIXED
ASSETS
- Tangible Assets
- Land
- Buildings
- Plant and Machinery
- Vehicles
- Furniture and Office Equipments
- Intangible Assets
- Designing Rights
- Software
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 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.54.43 |
|
|
1 |
Rs.83.20 |
|
Euro |
1 |
Rs.71.91 |
INFORMATION DETAILS
|
Report Prepared
by : |
MRI |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
6 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
8 |
|
--LIQUIDITY |
1~10 |
6 |
|
--LEVERAGE |
1~10 |
6 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
6 |
|
--MARGINS |
-5~5 |
|
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
61 |
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.