MIRA
INFORM REPORT
|
Report Date : |
11.01.2013 |
IDENTIFICATION DETAILS
|
Name : |
GOOD LUCK STEEL TUBES LIMITED |
|
|
|
|
Registered
Office : |
5/102, Sikka Complex, 1st Floor, Community Centre, Preet
Vihar, Vikas Marg, |
|
|
|
|
Country : |
India |
|
|
|
|
Financials (as
on) : |
31.03.2012 |
|
|
|
|
Date of
Incorporation : |
06.11.1986 |
|
|
|
|
Com. Reg. No.: |
55-050910 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs. 37.443 millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
L74899DL1986PLC050910 |
|
|
|
|
TAN No.: [Tax Deduction &
Collection Account No.] |
MRTG00350A |
|
|
|
|
PAN No.: [Permanent Account No.] |
AAACG3204D |
|
|
|
|
Legal Form : |
A Public Limited Liability Company. The Company’s Shares are Listed on
the Stock Exchanges. |
|
|
|
|
Line of Business
: |
Manufacturing of Black and G.I. Pipe, C.R. Sheet / Coil, G.P.G.C.
Sheet / Coil, C.R.C.A. Sheet / Coil, Structures, Poles, Stainless / Mild / Alloy steel forgings and
flanges, ERW Tube and CDW Tube. |
|
|
|
|
No. of Employees
: |
Not Available |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba (51) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
Maximum Credit Limit : |
USD 3900000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a part of Good Luck Group. It is well established company
having a good track record. Performance capacity of the company seems to be
good. Trade relations are reported to be 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 |
|
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 |
ICRA |
|
Rating |
BBB |
|
Rating Explanation |
Having moderate degree of safety regarding timely servicing of
financial obligations. It carry moderate credit risk. |
|
Date |
December - 2011 |
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 Office : |
5/102, Sikka Complex, 1st Floor, Community Centre, Preet
Vihar, Vikas Marg, |
|
Tel. No.: |
91-11-22465439 |
|
Fax No.: |
91-11-22214254 |
|
E-Mail : |
|
|
Website : |
|
|
|
|
|
Corporate Office : |
II F 166-167, Good Luck House, Nehru Nagar, |
|
Tel. No.: |
91-120-4196600 / 4196700 |
|
Fax No.: |
91-120-4196666 / 4196777 |
|
Email: |
|
|
|
|
|
Factory 1 : |
A-42 and 45,
Industrial Area, Sikandrabad, District Bulandshahr - 203205 |
|
Tel. No.: |
91-5735-221969 / 221970 |
|
Fax No.: |
91-5735-222863 |
|
|
|
|
Factory 2 : |
A-51, Industrial Area, Sikandarabad, District
Bulandhahar-203205, |
|
Tel. No.: |
91-5735-221017 |
|
|
|
|
Factory 3 : |
Khsra No. 2839, Dhoom Manik Pur, G.T. Road, Gautam Budh
Nagar, Dadri, Uttar Pradesh, India |
|
Tel. No.: |
91-120-2666896 |
|
|
|
DIRECTORS
As on 31.03.2012
|
Name : |
Mr. Mahesh Chandra Garg |
|
Designation : |
Director |
|
Address : |
R-4/52, Raj Nagar, |
|
Date of Birth/Age : |
28.06.1946 |
|
Date of Appointment : |
06.11.1986 |
|
DIN : |
00292437 |
|
|
|
|
Name : |
Mr. Ramesh Chandra Garg |
|
Designation : |
Director |
|
Address : |
10/159, Raj Nagar, Sector - 10, |
|
Date of Birth/Age : |
15.07.1946 |
|
Date of Appointment : |
12.09.1988 |
|
DIN : |
00298129 |
|
|
|
|
Name : |
Mr. Vijender Kumar Tyagi |
|
Designation : |
Director |
|
Address : |
K 36 Hig, Niti Nagar, Sector - 23, |
|
Date of Birth/Age : |
05.10.1957 |
|
Date of Appointment : |
19.12.2006 |
|
DIN : |
01584278 |
|
|
|
|
Name : |
Mr. Rahul Goel |
|
Designation : |
Director |
|
Address : |
Ke 93, Kavi Nagar, |
|
Date of Birth/Age : |
14.09.1972 |
|
Date of Appointment : |
19.12.2006 |
|
DIN : |
02067212 |
|
|
|
|
Name : |
Mr. Anurag Agarwal |
|
Designation : |
Director |
|
Address : |
Om Kunj, Chiranji Colony, Dadri,Gautam Budha Nagar, |
|
Date of Birth/Age : |
12.02.1982 |
|
Date of Appointment : |
19.12.2006 |
|
DIN : |
01584222 |
|
|
|
|
Name : |
Mr. Nitin Garg |
|
Designation : |
Director |
|
Date of Birth/Age : |
31.05.1980 |
|
Date of Appointment : |
21.09.2012 |
KEY EXECUTIVES
|
Name : |
Mr. Abhishek Agrawal |
|
|
Designation : |
Secretary |
|
|
Address : |
66b, Dayanand Block, Shakarpur, |
|
|
Date of Birth/Age : |
01.12.1979 |
|
|
Date of Appointment : |
19.12.2006 |
|
|
PAN No.: |
AIQPA6773J |
|
SHAREHOLDING PATTERN
As on 30.09.2012
|
Category of Shareholder |
No. of Shares |
Percentage of
Holding |
|
|
|
|
|
(A) Shareholding of Promoter and Promoter Group |
|
|
|
|
|
|
|
|
13173128 |
70.36 |
|
|
13173128 |
70.36 |
|
|
|
|
|
Total shareholding of Promoter and Promoter Group (A) |
13173128 |
70.36 |
|
(B) Public Shareholding |
|
|
|
|
|
|
|
|
835680 |
4.46 |
|
|
835680 |
4.46 |
|
|
|
|
|
|
1031443 |
5.51 |
|
|
|
|
|
|
3140009 |
16.77 |
|
|
139667 |
0.75 |
|
|
401323 |
2.14 |
|
|
196807 |
1.05 |
|
|
204516 |
1.09 |
|
|
4712442 |
25.17 |
|
Total Public shareholding (B) |
5548122 |
29.64 |
|
Total (A)+(B) |
18721250 |
100.00 |
|
(C) Shares held by Custodians and against which Depository Receipts
have been issued |
000 |
0.00 |
|
(1)
Promoter and Promoter Group |
000 |
0.00 |
|
(2)Public |
000 |
0.00 |
|
Sub Total |
000 |
0.00 |
|
Total (A)+(B)+(C) |
18721250 |
100.00 |
(1) Indian
Individuals / Hindu Undivided Family
Individual shareholders holding nominal
share capital up to Rs. 0.100 MillionBUSINESS DETAILS
|
Line of Business : |
Manufacturing of Black & G.I. Pipe, C.R. Sheet / Coil, G.P.G.C.
Sheet / Coil, C.R.C.A. Sheet / Coil, Structures, Poles, Stainless / Mild / Alloy steel forgings
& flanges, ERW Tube & CDW Tube.
|
GENERAL INFORMATION
|
No. of Employees : |
Not Available |
||||||||||||||||||||||||||||||||||||
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Bankers : |
|
||||||||||||||||||||||||||||||||||||
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|
||||||||||||||||||||||||||||||||||||
|
Facilities : |
· Term loan are secured by way of first charge on entire fixed assets of the company located at A-45, A-42 and A-51 Industrial Area, Secunderabad, District Bulandshahr and Plot No. 2839 Dhoom Manikpur, Dadri. Term loan are further secured by way of second charge on entire current assets of the company , both present & future and personal guarantee of the directors of the company · Working capital limits are secured by first charge on entire current assets of the company including stocks of raw-materials, work-in-progress, stock lying in godown and ports, finished goods and book debts both present and future. Working capital limits are further secured by way of second charge on entire fixed assets of the company, equitable mortgage of two immovable properties belonging to the directors of the company and their relatives, situated at Plot No. II -F - 166 and II - F-167 , Nehru Nagar, Ambedkar Road , Ghaziabad and personal guarantee of the directors of the company. |
|
|
|
|
Banking
Relations : |
----- |
|
|
|
|
Auditors : |
|
|
Name : |
Sanjeev Anand and Associates Chartered Accountants |
|
Address : |
77, Navyug Market, |
|
PAN No.: |
AAPFS7604B |
|
|
|
|
Associates : |
Saini Guarders and Alloys Private Limited |
CAPITAL STRUCTURE
As on 31.03.2012
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
50000000 |
Equity Shares |
Rs.2/- each |
Rs.100.000
millions |
|
|
|
|
|
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
18721250 |
Equity Shares |
Rs.2/- each |
Rs.37.443
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 |
37.443 |
37.443 |
37.442 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
940.698 |
750.104 |
608.951 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
978.141 |
786.547 |
646.393 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
2125.444 |
1422.776 |
1498.526 |
|
|
2] Unsecured Loans |
149.808 |
87.153 |
134.366 |
|
|
TOTAL BORROWING |
2275.252 |
1509.929 |
1632.892 |
|
|
DEFERRED TAX LIABILITIES |
82.806 |
66.326 |
60.382 |
|
|
|
|
|
|
|
|
TOTAL |
3336.199 |
2363.802 |
2339.667 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
799.016 |
632.660 |
530.998 |
|
|
Capital work-in-progress |
167.962 |
5.083 |
5.398 |
|
|
|
|
|
|
|
|
INVESTMENT |
0.000 |
0.515 |
0.000 |
|
|
DEFERRED TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
1024.516
|
670.276 |
598.161
|
|
|
Sundry Debtors |
1315.757
|
951.644 |
995.565
|
|
|
Cash & Bank Balances |
56.904
|
88.696 |
82.892
|
|
|
Other Current Assets |
0.000
|
0.000 |
0.000 |
|
|
Loans & Advances |
433.645
|
324.768 |
340.055
|
|
Total
Current Assets |
2830.822
|
2035.384 |
2016.673 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
202.466
|
46.805 |
34.769
|
|
|
Other Current Liabilities |
159.392
|
184.663 |
106.763
|
|
|
Provisions |
99.743
|
79.372 |
72.250
|
|
Total
Current Liabilities |
461.601
|
310.840 |
213.782 |
|
|
Net Current Assets |
2369.221
|
1725.544 |
1802.891
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.380 |
|
|
|
|
|
|
|
|
TOTAL |
3336.199 |
2363.802 |
2339.667 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
6790.480 |
5608.190 |
4775.079 |
|
|
|
Other Income |
144.361 |
121.984 |
128.078 |
|
|
|
TOTAL (A) |
6934.841 |
5730.174 |
4903.157 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of raw materials consumed |
5398.826 |
4416.454 |
|
|
|
|
Purchase |
3.201 |
5.940 |
|
|
|
|
Changes in Inventories |
(129.897) |
(19.872) |
3724.205 |
|
|
|
Employee Benefit Expenses |
232.994 |
180.582 |
139.596 |
|
|
|
Other Expenses |
898.625 |
738.854 |
637.530 |
|
|
|
Prior period adjustment |
5.949 |
17.492 |
6.417 |
|
|
|
TOTAL (B) |
6409.698 |
5339.450 |
4507.748 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
525.143 |
390.724 |
395.409 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
192.125 |
126.676 |
137.607 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
333.018 |
264.048 |
257.802 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
52.143 |
40.733 |
35.202 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
280.875 |
223.315 |
222.600 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
79.751 |
75.808 |
68.483 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
201.124 |
147.507 |
154.117 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
581.700 |
470.693 |
353.125 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
40.000 |
30.000 |
30.000 |
|
|
|
Dividend |
7.400 |
5.600 |
5.616 |
|
|
|
Tax on Dividend |
1.200 |
0.900 |
0.933 |
|
|
BALANCE CARRIED
TO THE B/S |
734.224 |
581.700 |
470.693 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
FOB Value of Export |
1834.265 |
1590.775 |
1333.632 |
|
|
TOTAL EARNINGS |
1834.265 |
1590.775 |
1333.632 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
4.147 |
81.409 |
116.414 |
|
|
|
Stores & Spares |
0.083 |
0.355 |
0.058 |
|
|
|
Capital Goods |
1.754 |
1.002 |
1.369 |
|
|
|
Others |
0.000 |
0.000 |
23.480 |
|
|
TOTAL IMPORTS |
5.984 |
82.766 |
141.321 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
10.74 |
7.88 |
8.25 |
|
QUARTERLY RESULTS
|
PARTICULARS |
1st
Quarter As on30.06.2012 |
2nd
Quarter As on30.09.2012 |
|
Net sales |
2600.530 |
2316.240 |
|
Total expenditure |
2431.970 |
2111.550 |
|
PBDIT |
168.560 |
204.690 |
|
Other income |
10.210 |
2.360 |
|
Operating profit |
178.770 |
207.050 |
|
Interest |
69.960 |
92.850 |
|
Exceptional items |
0.000 |
0.000 |
|
PBDT |
108.810 |
114.200 |
|
Depreciation |
14.390 |
17.450 |
|
Profit before tax |
94.420 |
96.750 |
|
Tax |
25.100 |
28.000 |
|
Provision and contingencies |
0.000 |
0.000 |
|
Profit after tax |
69.320 |
68.750 |
|
Extraordinary items |
0.000 |
0.000 |
|
Prior period expenses |
(0.020) |
2.010 |
|
Other adjustment |
0.000 |
0.000 |
|
Net profit |
69.300 |
70.760 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
PAT / Total Income |
(%) |
2.90
|
2.57 |
3.14 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
4.14
|
3.98 |
4.66 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
7.74
|
8.37 |
8.74 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.29
|
0.28 |
0.34 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
2.80
|
2.31 |
2.86
|
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
6.13
|
6.55 |
9.43
|
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 |
No |
|
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% |
----- |
|
Yes |
Estimation for coming
financial year |
No |
|
Yes |
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] |
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 |
|
Unsecured Loan |
31.03.2012 (Rs.
in Millions) |
31.03.2011 (Rs.
in Millions) |
|
From Shareholders |
101.203 |
80.653 |
|
From Body Corporate |
48.605 |
6.500 |
|
Total |
149.808 |
87.153 |
MANAGEMENT
DISCUSSION AND ANALYSIS
INDUSTRY OVERVIEW
Overall the global steel industry witnessed stagnant growth during 2012. The global steel demand was driven by demand from key steel end-user industries including infrastructure, construction and automotive, especially in the emerging markets; in spite of financial turbulence in the Eurozone, weak private demand in the United States and events in Japan and the Middle East.
The Indian steel industry has also missed its 2011/2012 production target by a whooping 40%, thanks to land acquisition troubles which have left multiple projects just words on paper. India had targeted 124 Million Tonnes of steel production for 2011/2012 but could only achieve 72 Million Tonnes overall, a more than 41% deviation from the set standard. The Indian government has now moved the 124 MT target to 2016-2017.
India's steel consumption growth has also been weakening. As per initial estimates, Indian steel consumption grew by a mere 5.5% in 2011/2012 and may moderate to 4-5% in the current fiscal. Due to policy paralysis in Indian and bad health of world economy, all the major projects has been stopped or slowed down having adverse impact on the growth of the steel industry along with other industries. The auto mobile sector, one of major consumer of steel forged item, was growing with a mopping growth rate in first half of the year 20111-12 has also shy away in the second half of the year 2012.
For 2012 as a whole, global steel demand is forecast to grow by a further 4% to reach 1,422 million tonnes. China, India and other emerging markets will continue to drive demand but recent market developments suggest likely slackening of demand.
ECONOMY
There is a dark mood in the advanced economies, especially in Europe, between 2008-2011, the US and the Eurozone economies have virtually stagnated- even in nominal terms. The US economy is certainly picking up, but the recovery is weaker that had been expected. European countries are facing financial turmoil because they could not reach a consensus on restructuring their economies, debt and budgetary outlays in the face of public protests. Public unrest swelled in some oilproducing countries resulting in uncertainties in oil production/ price. Rising international prices of crude oil have affected the global economies badly. Japan was struck by the devastating earthquake and tsunami affecting, in particular, developing economies.
The IMF continues to emphasize the downside risks that can emerge, primarily from the Eurozone. The Eurozone problems are likely to continue to be a problem for some years to come and further from time to time, bad news out of the Eurozone can have- even if temporarydisproportionately large negative effects on the global financial world and ultimately on investor and business confidence. Conditions in the EU have impacted, and will continue to negatively impacted Eurozone bank financing, which has been significant for Indian private sector infrastructure projects. This is likely to influence badly the demand of steel tubes and pipe and other steel products.
Asia will be under pressure for the most part because of pressure on its final export markets in the west, and also from domestic factors including demand for higher wages and the rising of energy costs. China has slowed somewhat and there may be continued difficulties in its path, as adjustments have to be made for rising wage costs and higher expectations. However, economic growth in China projected at 8.0 and 8.5 percent in 2012 and 2013 respectively, and that for the rest of developing East and South East Asia, as well as that in Africa, suggests that developing economy demand will remain reasonably buoyant. This may be seen from the IMF growth projections for the developing Asia, excluding China and India, for 2012 and 2013 which are 5.0 and 5.7 per cent respectively, while that for sub-Saharan Africa are around 5.4 percent. Keeping in view of the present world Economy scenario and Indian economic and political scenario, it is very difficult to have a concrete opinion over the growth of Indian economy, but still the Indian government is eying for a growth at 6.7 per cent in 2012/13. Manufacturing sector is also projected to grow at 4.5 per cent. Electricity, automotive, steel and cement sector have shown improvement in the period of April-June. Because of the benefits of the low base, manufacturing sector will show improved performance in the second half of this year.
OPPORTUNITY
India has been a net importer of steel especially at the high value-added end product portfolio and is likely to continue to do so. The steel demand in India will continue to grow given the significant need for infrastructure growth and the increasing urbanization of the population. The industrial machines, railways, oil and gas, power plants, chemical plants, and automotive industry are the major end user of our products. The government is also working on clearing of infrastructure projects on fast track mode. The available data on output for the first quarter month in the automotive sector shows that production of passenger vehicles was higher by 9.4 % while two wheeler increased by 9.7 %. Output of steel and cement in the April to June also were higher of 3.6 and 9.9 % respectively, which is not suggestive of extended stagnation. The impact of positive policy developments in the course of the year is expected to benefit the economy, in particular the investment environment, and result in significantly improved output levels in the manufacturing sector.
THREAT
Raw material prices are one of the determinants of global steel price but not the only one. Various factors combine to determine steel price; such as underlying demand and the competitive advantage of local steel manufacturers. Global raw material dynamics should be read in conjunction with changes taking place within the Indian steel scene. Curtailment of iron ore production due to reduced exports, increase in price of ore due to e-auction, reduced coal availability due to its diversion for power generation coupled with increased power and
freight costs has led to declining profitability of the Indian steel makers.
PERFORMANCE
The Company continued to lay more emphasis on value added productswhich are able to add bottom line more significantly and having comparatively lesser contribution for top line. The result of the policy is shown in the year 2012. During the year, the Company's total production (quantity wise) increased by merely 6 % while the total revenue grown by 21 % in comparison of last year and the profit for the year 2012 jumped by 36%.
The company has also shown a commendable performance in its export market. Where, while all the world economy is shrinking, the company has registered a growth of 17% in its international business. The Book value of the shares of the company has reached to Rs. 52 per share in the year 2012, while it was Rs. 42 per share in last year.
This year, according to the nature of products and services, the management has recognized three segments and has reported segment wise performance also. The Engineering goods segment has registered tremendous growth and during the year, the profit before interest and tax from this segment has galloped to Rs.139.200 Millions which was only Rs.74.300 Millions in the last year. It means there is a growth of 87%. Further, an Auto tube segment has also performed impressively and has shown a growth of 57 % over the last year.
OUTLOOK
Demand for finished steel products is expected to remain robust during the country's 12th plan period running from 2012- 2016. Firm demand will be from the infrastructure, on the backdrop of government's target of investing $1.5 trillion for developing the country's infrastructure sector up from $500 billion during the previous 11th plan period (2007- 2012). According to the Planning Commission of India, infrastructure and real estate construction has been the sectors in the economy fuelling the demand of finished steel products during recent plan
Periods Rolled coil manufacturer of India are likely to keep their domestic base prices for the HR coil same as was in 2011. As domestic demand is slow, the sustained depreciation of the rupee against the dollar delivers import of coils unviable, helping local mills keep their prices firm.
CONTINGENT
LIABILITIES:
(Rs. in millions)
|
PARTICULARS |
31.03.2012 |
|
Outstanding bank guarantees issued by the banks Counter
guaranteed by the Company |
1193.53 |
|
Commitments : |
|
|
i) Estimated amount of contracts remaining to be
executed on Capital Account and not provided for |
360.41 |
ii)
The Income Tax assessments of the Company have been completed upto Assessment
Year 2009-10. The disputed demand outstanding upto the said Assessment Year is
Rs. 253.400 millions (Previous Year Rs. 185.800millions). Based on the
decisions of the Appellate authorities and the interpretations of other
relevant provisions, the Company has been legally advised that the demand is
likely to be either deleted or substantially reduced and accordingly no
provision has been made
FIXED
ASSETS
- Land
- Furniture and Fixture
- Plant and Machinery
- Office Equipments
- Electrical Installation
- Vehicles
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 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.54.96 |
|
|
1 |
Rs.88.23 |
|
Euro |
1 |
Rs.71.92 |
INFORMATION DETAILS
|
Report Prepared
by : |
SPN |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
5 |
|
PAID-UP CAPITAL |
1~10 |
5 |
|
OPERATING SCALE |
1~10 |
6 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
6 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
5 |
|
--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 |
|
51 |
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.