MIRA INFORM REPORT
|
Report Date : |
03.06.2013 |
IDENTIFICATION DETAILS
|
Name : |
J.K. CEMENT LIMITED |
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|
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Registered
Office : |
Kamla Tower, Kanpur – 208001, Uttar Pradesh, India |
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Country : |
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Financials (as
on) : |
31.03.2012 |
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Date of
Incorporation : |
24.11.1994 |
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Com. Reg. No.: |
017199 |
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Capital
Investment / Paid-up Capital : |
Rs. 699.272 Millions |
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CIN No.: [Company Identification
No.] |
L17229UP1994PLC017199 |
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|
|
Legal Form : |
A Public Limited Liability company. The company’s Share are Listed on
the Stock Exchange. |
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Line of Business
: |
Manufacturing of Cement |
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|
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|
No. of Employees
: |
2214 (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 61160000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is an established and a reputed company having a good track
record. There appear increases in the profitability of the company during
2013. Trade relations are fair. Business is active. Payments are recorded as
regular and as per commitments. The company can be considered good 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 |
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High |
B2 |
|
Very High |
C1 |
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Restricted |
C2 |
|
Off-credit |
D |
EXTERNAL AGENCY RATING
|
Rating Agency Name |
CARE |
|
Rating |
Long term bank facilities AA- |
|
Rating Explanation |
High degree of safety and very low credit
risk |
|
Date |
December 19, 2012 |
|
Rating Agency Name |
CARE |
|
Rating |
Short term bank facilities A1+ |
|
Rating Explanation |
Very strong degree of safety and lowest
credit risk. |
|
Date |
December 19, 2012 |
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 : |
Kamla Tower, Kanpur – 208001, Uttar Pradesh, India |
|
Tel. No.: |
91-512-2371478-81 |
|
Fax No.: |
91-512-2399854 |
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E-Mail : |
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Website : |
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Central Marketing Office : |
Padam Tower, 19, DDA Community Centre, Okhla, Phase-I, New
Delhi-110020, India |
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Plant : |
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Grey Cement Plants: |
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White Cement Plant: |
Gotan, District Nagaur, Rajasthan, India |
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Thermal Power Plants: |
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Waste Heat Recovery Power Plant (For captive consumption) |
Kailash Nagar, Nimbahera, District Chittorgarh, Rajasthan, India |
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Overseas: |
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Dual process White /Grey Cement Plant (under implementation) |
Plot No.7, Habhab, Tawian Fujairah, UAE |
DIRECTORS
As on 31.03.2012
|
Name : |
Dr. Gaur Hari Singhania, |
|
Designation : |
Chairman |
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|
Name : |
Yadupati Singhania, |
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Designation : |
Managing Director and CEO |
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|
Name : |
Achintya Karati |
|
Designation : |
Managing Director and CEO |
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|
Name : |
Ashok Sharma |
|
Designation : |
Managing Director and CEO |
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|
Name : |
Jayant Narayan Godbole |
|
Designation : |
Managing Director and CEO |
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|
Name : |
Jyoti Prasad Bajpai |
|
Designation : |
Managing Director and CEO |
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|
Name : |
Kailash Nath Khandelwal |
|
Designation : |
Managing Director and CEO |
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|
Name : |
Dr. K.B. Agarwal |
|
Designation : |
Managing Director and CEO |
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Name : |
Raj Kumar Lohia |
|
Designation : |
Managing Director and CEO |
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Name : |
Suparas Bhandari |
|
Designation : |
Managing Director and CEO |
KEY EXECUTIVES
|
Name : |
Shambhu Singh |
|
Designation : |
Company Secretary |
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|
Name : |
A.K. Saraogi |
|
Designation : |
President (Corporate Affairs) and CFO |
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|
Name : |
Ashok Ghosh |
|
Designation : |
President (H.R.) and New Initiatives |
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Name : |
B.K. Arora, |
|
Designation : |
President(Works)-White Cement |
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Name : |
D. Ravishanker |
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Designation : |
President (Projects) |
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Name : |
M.P. Rawal |
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Designation : |
President (T and MS) |
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Name : |
R.C. Shukla |
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Designation : |
President (Marketing)-Grey Cement |
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Name : |
K.K. Jalori |
|
Designation : |
Unit Head-Grey Cement-North |
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|
Name : |
Shabbir Khan |
|
Designation : |
Unit Head-Grey Cement-South |
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|
Name : |
Mohan Sharma |
|
Designation : |
Head (Marketing) White Cement |
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|
Name : |
Dr. Kaustubh Dadhich |
|
Designation : |
Head (Marketing) –Grey Cement-South |
BUSINESS DETAILS
|
Line of Business : |
Manufacturing of Cement |
GENERAL INFORMATION
|
No. of Employees : |
2214 (Approximately) |
|
|
|
|
Bankers : |
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Facilities : |
Non Convertible
Debentures (Ncds): ` 40000.00 Lacs( ` 40000.00 Lacs) Secured by first
mortgage on the Company’s flat at Ahmedabad and also against first pari-passu
charge on the assets specified below Term Loans
related to Cement Plants at Rajasthan a) From
Consortium of Banks : Nil (Rs.669.262 millions) b) From other
Banks : Rs.1352.261 millions (RS.1321.451 millions) Secured by first
pari-passu charge by way of equitable mortgage of all the immovable assets
and hypothecation of all the movable assets of the Company both present and
future save and except inventories , book debts, cash and bank balances and
all assets pertaining to J.K. Cement Works, Gotan, J.K. Cement Works,
Muddapur, Karnataka and properties having exclusive charge of other lenders. c) From Canara
Bank : Rs. 242.453 millions (Rs.306.783 millions) Secured by
equitable mortgage of immovable properties and hypothecation of movable
assets pertaining to undertaking of J.K. Cement Works, Gotan except current
assets and vehicles. Term Loans
related to Cement Plant at Karnataka From Consortium of
Banks: Rs. 4304.221 millions (Rs. 4965.890 millions) Secured by First
Pari-passu charge by way of equitable mortgage of all the immovable assets
and hypothecation of all movable assets , present and future (save and except
book debts) pertaining to J.K. Cement Works, Muddapur, Karnataka subject to
prior charges in favour of working capital lenders on inventories and other
current assets. Term Loans
related to the Properties: Rs. 558.507 millions (Rs. 5071.49 millions) Secured by
exclusive charge by way of equitable mortgage over the immovable assets and
hypothecation of movable assets pertaining to the specified properties. Maturity
profile: Non Convertible
Debentures
Term Loans from
Banks
Vehicle
Loans: Rs.61.665
millions (Rs.51.979 millions) Secured by
hypothecation of vehicles Maturity profile
of Vehicle Loan:
VAT
Loan(Interest free) from Govt. of Karnataka: Rs.149.121 millions Secured by second
Pari Passu charge by way of equitable mortgage of land building and plant and
machinery pertaining to J.K. Cement Works, Muddapur, Karnataka and bank
guarantee. Second charge on assets is yet to be created. Maturity
profile: Payable after 2017 onwards. Deffered Sales
Tax Liability: Rs. 680.023 millions (Rs.769.880 millions) 8% Unsecured
Loan Rs.183.906 millions (Rs.329.198 millions) granted by Government of
Rajasthan payable in equitable monthly installments upto July,2013. 52.063 millions (Rs.64.524
millions) Interest free deferred sales tax liability payable in quarterly
equitable installment in next 5 years. Rs. 48.932
millions (Rs.48.932 millions) Interest free deferred sales tax liability
payable in quarterly equitable installment in 5 years from July,2013 onwards.
The installment amount is Rs.2.47 millions. Rs. 395.122
millions (Rs.327.226 millions): Interest free deferred sales-tax liability.
The availment of said scheme is still continued. The payment after
accumulation of said scheme will start w.e.f. July,2014 in quarterly
equitable installments in 5 years. Cash Credit
Account: Rs.828.271 millions (Rs.599.046 millions) Cash credit
accounts are secured by first charge on current assets of the Company namely
inventories, book debts, etc. and second charge on fixed assets of the
Company except the fixed assets pertaining to J.K. Cement Works, Gotan and
the assets having exclusive charge of other lenders.(Second charge on
immovable assets related to J.K. Cement Works, Muddapur, Karnataka is yet to
be created). |
|
Banking
Relations : |
-- |
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|
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Auditors : |
|
|
Name : |
P.L. Tandon and Company Chartered Accountants |
|
Address : |
Westcott Building, The Mall, Kanpur-208001 Uttar Pradesh, India |
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Control/Significant Influence Exists |
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Subsidiary Companies : |
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Joint Venture : |
Bander Coal Company (P) Limited |
CAPITAL STRUCTURE
As on 31.03.2012
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
80000000 |
Equity Shares |
Rs.10/- each |
Rs. 800.000 Millions |
|
|
|
|
|
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
69927250 |
Equity Shares |
Rs.10/- each |
Rs. 699.272
Millions |
|
|
|
|
|
Details of share holding more than 5% shares in the company
|
Name of the
shareholder |
No. of Shares |
% of holding in the class |
|
Yadu
International Ltd |
22655100 |
32.40 |
|
Yadupati
Singhania |
13246086 |
18.94 |
|
Juggilal
Kamlapat Holding Ltd. |
6950000 |
9.94 |
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 |
699.272 |
699.272 |
699.272 |
|
|
2] Share Application Money |
0.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
14590.798 |
13291.134 |
12838.226 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
15290.070 |
13990.406 |
13537.498 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
10247.681 |
10570.524 |
9376.121 |
|
|
2] Unsecured Loans |
545.758 |
612.128 |
1361.082 |
|
|
TOTAL BORROWING |
10793.439 |
11182.652 |
10737.203 |
|
|
DEFERRED TAX LIABILITIES |
2291.100 |
2109.000 |
1858.000 |
|
|
|
|
|
|
|
|
TOTAL |
28374.609 |
27282.058 |
26132.701 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
23158.189 |
22964.761 |
20522.082 |
|
|
Capital work-in-progress |
850.456 |
984.440 |
2252.806 |
|
|
|
|
|
|
|
|
INVESTMENT |
108.419 |
58.419 |
59.880 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
3628.296
|
3210.196 |
2376.233 |
|
|
Sundry Debtors |
837.228
|
607.613 |
818.731 |
|
|
Cash & Bank Balances |
4324.899
|
3210.792 |
1316.707 |
|
|
Other Current Assets |
115.355
|
136.833 |
17.940 |
|
|
Loans & Advances |
2780.632
|
2853.479 |
2318.308 |
|
Total
Current Assets |
11686.410
|
10018.913 |
6847.919 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
2279.266
|
1752.375 |
1434.515 |
|
|
Other Current Liabilities |
4522.568
|
4558.282 |
1857.018 |
|
|
Provisions |
627.031
|
433.818 |
285.394 |
|
Total
Current Liabilities |
7428.865
|
6744.475 |
3576.927 |
|
|
Net Current Assets |
4257.545
|
3274.438 |
3270.992 |
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
DEFFERED REVENUE EXPENDITURE |
0.000 |
0.000 |
26.941 |
|
|
|
|
|
|
|
|
TOTAL |
28374.609 |
27282.058 |
26132.701 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
25467.883 |
20943.485 |
18267.847 |
|
|
|
Other Income |
468.285 |
299.133 |
192.912 |
|
|
|
TOTAL (A) |
25936.168 |
21242.618 |
18460.759 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of materials consumed |
3121.657 |
2771.530 |
|
|
|
|
Purchase of stock in trade |
5.003 |
4.608 |
|
|
|
|
Changes in inventories of finished goods.
work in progress. Stock in trade |
(68.837) |
(168.406) |
|
|
|
|
Employee benefit expense |
1404.431 |
1274.820 |
|
|
|
|
Other Expenses |
15839.267 |
14283.339 |
|
|
|
|
TOTAL (B) |
20301.521 |
18165.891 |
13876.757 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
5634.647 |
3076.727 |
4584.002 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL EXPENSES (D) |
1442.805 |
1185.094 |
616.322 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
4191.842 |
1891.633 |
3967.680 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
1255.791 |
1127.334 |
855.094 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
EXCEPTIONAL ITEM AND TAX |
2936.051 |
764.299 |
0.000 |
|
|
|
|
|
|
|
|
|
Less |
EXCEPTIONAL ITEM |
78.190 |
(72.472) |
0.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
2857.861 |
836.771 |
3112.586 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
1084.520 |
196.321 |
852.600 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
1773.341 |
640.450 |
2259.986 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
2017.833 |
1718.176 |
NA
|
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
500.000 |
65.000 |
1500.000 |
|
|
|
Transfer to Debenture Redemption Reserve |
113.250 |
113.250 |
0.000 |
|
|
|
Dividend on Equity Shares (including tax
thereon) |
406.356 |
162.543 |
489.922 |
|
|
BALANCE CARRIED
TO THE B/S |
2771.568 |
2017.833 |
1718.176 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Export of Goods Calculated on FOB Value |
273.484 |
189.931 |
203.528 |
|
|
TOTAL EARNINGS |
273.484 |
189.931 |
203.528 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
622.632 |
490.084 |
296.461 |
|
|
|
Components, Stores & Spare Parts and Packing
Material |
663.455 |
246.337 |
466.498 |
|
|
|
Capital Goods |
0.000 |
53.789 |
64.238 |
|
|
TOTAL IMPORTS |
1286.087 |
790.210 |
827.197 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
25.36 |
9.16 |
32.32 |
|
QUARTERLY /
SUMMARISED RESULTS
|
PARTICULARS |
30.06.2012 1st Quarter |
30.09.2012 2nd Quarter |
31.12.2012 3rd Quarter |
31.03.2013 4th Quarter |
|
Type |
UnAudited |
UnAudited |
UnAudited |
UnAudited |
|
Sales Turnover |
7374.600 |
7148.800 |
6880.800 |
7715.500 |
|
Total Expenditure |
5790.700 |
5831.900 |
5531.900 |
6364.800 |
|
PBIDT (Excl
OI) |
1583.900 |
1316.800 |
1348.900 |
1350.700 |
|
Other Income |
124.000 |
122.400 |
154.600 |
85.800 |
|
Operating
Profit |
1707.900 |
1439.200 |
1503.500 |
1436.400 |
|
Interest |
374.500 |
290.300 |
410.000 |
323.400 |
|
Exceptional
Items |
0.000 |
0.000 |
0.000 |
0.000 |
|
PBDT |
1333.400 |
1149.000 |
1093.500 |
1113.000 |
|
Depreciation |
313.900 |
318.800 |
317.900 |
332.000 |
|
Profit
Before Tax |
1019.500 |
830.200 |
775.600 |
781.000 |
|
Tax |
330.800 |
289.200 |
231.800 |
219.100 |
|
Provisions and contingencies |
0.000 |
0.000 |
0.000 |
0.000 |
|
Profit After Tax |
688.700 |
540.900 |
543.800 |
562.000 |
|
Extraordinary Items |
0.000 |
0.000 |
0.000 |
0.000 |
|
Prior Period Expenses |
0.000 |
0.000 |
0.000 |
0.000 |
|
Other Adjustments |
0.000 |
0.000 |
0.000 |
0.000 |
|
Net Profit |
688.700 |
540.900 |
543.800 |
562.000 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
PAT / Total Income |
(%) |
6.84
|
3.01 |
12.24 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
11.22
|
3.99 |
17.04 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
8.20
|
2.54 |
11.37 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.19
|
0.06 |
0.23 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Debt /Networth) |
|
0.70
|
0.80 |
0.79 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.57
|
1.48 |
1.91 |
LOCAL AGENCY FURTHER INFORMATION
|
Sr. No. |
Check List by Info
Agents |
Available in Report (Yes / No) |
|
1] |
Year of Establishment |
Yes |
|
2] |
Locality of the firm |
Yes |
|
3] |
Constitutions of the firm |
Yes |
|
4] |
Premises details |
No |
|
5] |
Type of Business |
Yes |
|
6] |
Line of Business |
Yes |
|
7] |
Promoter's background |
No |
|
8] |
No. of employees |
Yes |
|
9] |
Name of person contacted |
No |
|
10] |
Designation of contact person |
No |
|
11] |
Turnover of firm for last three years |
Yes |
|
12] |
Profitability for last three years |
Yes |
|
13] |
Reasons for variation <> 20% |
---------------------- |
|
14] |
Estimation for coming financial year |
No |
|
15] |
Capital in the business |
Yes |
|
16] |
Details of sister concerns |
Yes |
|
17] |
Major suppliers |
no |
|
18] |
Major customers |
No |
|
19] |
Payments terms |
No |
|
20] |
Export / Import details (if applicable) |
No |
|
21] |
Market information |
---------------------- |
|
22] |
Litigations that the firm / promoter involved in |
---------------------- |
|
23] |
Banking Details |
Yes |
|
24] |
Banking facility details |
Yes |
|
25] |
Conduct of the banking account |
---------------------- |
|
26] |
Buyer visit details |
---------------------- |
|
27] |
Financials, if provided |
Yes |
|
28] |
Incorporation details, if applicable |
Yes |
|
29] |
Last accounts filed at ROC |
Yes |
|
30] |
Major Shareholders, if available |
No |
|
31] |
Date of Birth of Proprietor/Partner/Director, if available |
No |
|
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:
|
Particulars |
31.03.2012 |
31.03.2011 |
|
Deferred Sales Tax Liability |
545.758 |
612.128 |
|
|
|
|
|
Total |
545.758 |
612.128 |
MANAGEMENT DISCUSSION
AND ANALYSIS REPORT
ECONOMIC REVIEW
INDIAN ECONOMY
The Indian economy has undergone a tough phase in the year 2011-12. The growth was impacted by both the deteriorating global economy and various domestic issues like high interest rates, inflation, infrastructure constraints, lack of political consensus and liquidity crunch among others. Besides, a fragile external account has caused depreciation of rupee in the backdrop of volatile global risk sentiment. Indian GDP growth is restricted to 6.5% (at factor costs) in financial year 2011-12.
OUTLOOK
The Union Budget 2012-13 has announced measures to augment the supply side response of the economy to maintain price stability and growth. The service sector comprising 57% of GDP is expected to come down from 9.4% in 2011-12 to 8.7% in 2012-13 on account slackening demand from hotels, transportation, and communication, community, social and personal services. The industrial segment on the other hand is expected to improve from 4.5% in 2011-12 to 5.6% in 2012-13 on account of expected money easing by RBI. The agricultural sector is expected to clock in a flat growth of 3% in 2012-13 in the event of normal monsoon. Considering these domestic factors and a mild improvement in global macro-economic scenario, the GDP growth is expected to return back to the levels of 7% in 2012-13
CEMENT INDUSTRY STRUCTURE AND DEVELOPMENT
OVERVIEW
India is the second largest cement market after China, accounting for 7-8% of the total global production with an installed capacity of over 300 Mntpa by the end of 2011-12. Cement being a cyclical commodity, has a high correlation with GDP, accounting for around 1.2x of nominal GDP. Over the years housing sector has been the pillar of cement consumption in India constituting 64% of the total consumption, followed by infrastructure (17%), Commercial and Institutional (13%) and rest by Industrial segment (6%).
CEMENT CONSUMPTION PATTERN
The year 2011-12 witnessed India’s cement production reported growth of 6.2% mainly owing to slowdown in construction activities, prolonged monsoon, delay in infrastructural projects caused by environmental clearances hurdle and overall downturn in the economy. Resultant capacity utilisation levels also declined to 73.7% in 2011 12 as against 74.4% in 2010-11 owing to higher capacity additions as against incremental demand.
OUTLOOK
GREY CEMENT
The long term drivers for the cement demand remain intact in the form of higher infrastructure spending, strong growth in rural housing, peaking interest rates and normal growth in urban housing. All these factors would trigger cement demand and bring back the momentum on track. Given the slowing pace of capacity additions, the installed capacity is expected to have 6.7% CAGR across India till 2015. Investments planned by the government under various sub-sectors of infrastructure and US$ 1 trillion allocated to infra development in the country during the XIIth five year Plan period would require an overall cement capacity of around 480 million tonnes.
WHITE CEMENT
Growing product awareness and its long-term advantages has led to spurt in demand in YoY demand of white cement and wall putty especially from middle and high income group. While white cement is used as base work for interior and exterior applications for residential and commercial segments, wall putty finds its application as water resistant and provides a sub coating surface for decorative paints. With increasing wall putty applications for interiors, the demand is expected to grow 25% annually.
GROWTH DRIVERS
HUGE INVESTMENTS IN INFRASTRUCTURE BY GOVERNMENT
The government has intended to expend US$ 1 trillion on infrastructure in the XIIth five year plan period (2012 17), against an investment of US$ 514 billion in the XIth five year plan period. The sustained focus of the government on infrastructure development especially in power, road, and irrigation would boost up the demand for the cement sector. The government in its budget has increased allocation to various schemes like PMGSY, AIBP in the range of 13% to 20% for the benefit of the construction sector. All this would augur the growth of cement.
STRONG DEMAND FROM THE HOUSING SECTOR
Around 64% of the total cement demand is contributed from the housing segment. It also accounts for 80% of the total real estate developments in the country. Increased urbanisation and rising income levels would drive the demand of this sector. Housing demand is expected to be robust backed by various measures adopted in the budget like continued interest subvention up to Rs. 1.500 millions, exemption from service tax for low costhousing construction, and increase in investment-linked deduction of capital expenditure on low-cost housing to 150% from 100%. The strong housing demand would in turn fuel the demand for cement.
REGIONAL SPREAD OF THE CEMENT INDUSTRY
The cement industry is split up into five geographic regions, south, north, west, central and east. The Southern region of India has a total installed capacity of 120.1 mtpa (38.7% of total India’s cement capacity) and dominates the cement space, followed by North with 67.3 mtpa (21.7% of total India’s cement capacity). Whereas, the Western region has a total capacity of 44.7 (14.4% of total India’s cement capacity), Central India has a total capacity of 40.2 mtpa (13.0% of total India’s cement capacity) and Eastern India has a total installed capacity of 37.6 mtpa (12.1% of total India’s cement capacity).
PERFORMANCE DURING THE YEAR
Grey Cement- the Company recorded 3% increase in cement production volume over last year. Capacity utilisation of Karnataka unit is likely to improve further which may contribute additionally during current fiscal. White Cement-White cement has achieved 7% increase in volume and Wall Putty has achieved 27% increase in volume over last year. The Company expects that white cement and wall putty consumption will increase around 10% and 25 % respectively in the current fiscal. Company is already geared up to meet this increased demand.
OVERALL PERFORMANCE
The Company’s performance during the year under report has improved in terms of production, sales quantity as well as turnover and profitability. The Company’s turnover increased to Rs. 25470.000 Millions during the year compared to Rs. 20940.000 Millions in previous year. Profit before Depreciation and Tax achieved at Rs. 4110.000 millions compared to Rs. 1960.000 Millions.
OPERATIONS
GREY CEMENT
During the year under report, in respect of grey cement plants in Rajasthan and Karnataka production increased by 3.2% at 5.32 Million Tons (compared to 5.15 Million Tons last year), despatches by 3.64% at 5.33 Million Tons (compared to 5.14 Million Tons last year) and sales by 4.17% at 5.33 Million Tons (compared to 5.11 Million Tons last year). The contribution during the year was comparatively higher.
WHITE CEMENT
Production of White Cement increased by 7.31% at 3.77 Lacs tonne during the year compared to 3.51 Lacs tonne while value added products registered increase of 26.68%. Sale was also in tandem with production. Increase in volume of white cement and value added products (wall putty) and other cost cutting measures resulted in higher contribution during the year as compared to previous year.
PROJECTS OF THE COMPANY
EXPANSION INITIATIVES
The Company is revisiting the size of proposed expansion plan at Mangrol, Rajasthan from earlier envisaged 3.5 Million Tons to around 2.5 Million Tons, on account of delay in allotment of new mining area to the Company. Viability study for 2.5 Million Tons capacity plant is under preparation and a final decision will be taken during the course of the year.
FINANCE
During the year under report the Company has completed repayment of the final instalment of Term Loan of Rs. 4625.000 Millions availed in 2004 consequent upon which the personal guarantees extended and shares pledged by the Promoters for availing such loan has been released by the lenders. The Company, during the year, has availed additional term loan of Rs. 499.600 Millions and repaid Rs. 1821.700 Millions. On Company’s endeavour the lenders of Karnataka Term Loan reduced the rate of interest by 0.5% and for Cash credit limits also the interest rate has been reduced by 0.5%. Considering the size of operation the Working Capital limit has been increased by Rs. 1000.000 Millions by the lenders.
CONTINGENT LIABILITIES:
|
Particulars |
31.03.2012 |
31.03.2011 |
|
|
|
|
|
I.
In respect of claims excluding indeterminate
claims of
employees against the Company not acknowledged as debts |
273.745 |
341.416 |
|
II.
In respect of disputed demands for which Appeals are
pending with Appellate Authorities/Courts – no provision has been considered necessary by the
Management |
|
|
|
a)
Excise duty b)
Custom duty c)
Sales tax d)
Service tax e) Income tax |
133.495 17.628 415.310 89.017 -- |
122.967 17.628 227.755 108.542 167.970 |
|
III.
In respect of
interest on “Cement Retention Price” realised
in earlier years |
112.916 |
110.878 |
|
|
|
|
|
IV. In respect of
Corporate Guarantee given in favour of
Joint Venture Company and others |
95.289 |
95.289 |
AUDITED FINANCIAL RESULTS FOR THE QUARTER & YEAR ENDED 31 ST MARCH,
2013
|
Particulars |
Quarter Ended 31.03.2013 |
Quarter Ended 31.12.2012 |
Year Ended 31.03.2013 |
|
|
|
Audited |
Unaudited |
Audited |
|
|
|
|
|
|
|
|
Income from operations: |
8847.487 |
7914.841 |
33425.829 |
|
|
Gross Sales |
7688.109 |
6869.065 |
29040.373 |
|
|
a) Net sales /Income from operations |
27.392 |
11.745 |
79.304 |
|
|
b) Other operating Income |
7715.501 |
6880.810 |
29119.677 |
|
|
Total Income from operations (Net) |
|
|
|
|
|
Expenses |
|
|
|
|
|
a) Cost of materials consumed |
1050.482 |
1054.011 |
3978.376 |
|
|
b) Purchase of stock in trade |
1.701 |
2.016 |
5.312 |
|
|
c) Changes in inventories of finished
goods.work in progress. Stock in trade d) Employee benefit expense |
115.834 349.462 |
(318.116) 409.537 |
(367.487) 1578.867 |
|
|
e) Depreciation |
331.963 |
317.897 |
1282.559 |
|
|
f) Power & Fuel |
1769.451 |
1712.488 |
7139.946 |
|
|
g) Stores & Spares |
602.735 |
533.926 |
2284.347 |
|
|
h) Freight & Handling outwards |
1711.901 |
1415.165 |
5996.888 |
|
|
i) Other Expenditure |
763.284 |
722.898 |
2903.180 |
|
|
Total (a to i) |
6696.813 |
5849.822 |
24801.988 |
|
|
Profit from operations before other Income,
finance cost & |
1018.688 |
1030.988 |
4317.689 |
|
|
exceptional Items (1-2) |
85.753 |
154.564 |
486.735 |
|
|
Other Income |
|
|
|
|
|
Profit from ordinary activities before
finance cost and |
1104.441 |
1185.552 |
4804.424 |
|
|
exceptional Items (3+4) |
323.438 |
409.953 |
1398.151 |
|
|
Finance Costs |
|
|
|
|
|
Profit from ordinary activities after
finance cost but before |
781.003 |
775.599 |
3406.273 |
|
|
exceptional Items (5-6) |
- |
- |
- |
|
|
Exceptional Items |
781.003 |
775.599 |
3406.273 |
|
|
Profit from Ordinary activities before tax
(7-8) |
219.048 |
231.769 |
1070.817 |
|
|
Tax Expense (Including deferred tax and tax
adjustment of earlier years) |
561.955 |
543.830 |
2335.456 |
|
|
Net Profit from ordinary activities after
tax (9-10) |
- |
- |
- |
|
|
Extraordinary items (net of tax expense) |
561.955 |
543.830 |
2335.456 |
|
|
Net Profit for the period (11-12) |
|
|
|
|
|
Share of Profit/(Loss) of associates |
|
|
|
|
|
Minority Interest |
|
|
|
|
|
Net Profit after taxes, minority interest
and share of profit/(loss)of associates (13+14+15) |
561.955 |
543.830 |
2335.456 |
|
|
Paid-up Equity Share Capital (Face value of
Rs. 10/- per share) |
699.272 |
699.272 |
699.272 |
|
|
Reserves (Excluding Revaluation
Reserve) |
- |
- |
14001.956 |
|
|
Basic and diluted earnings per share (Not Annualized) (Rs.) |
|
|
|
|
|
Before extraordinary items |
8.04 |
7.78 |
33.40 |
|
|
After extraordinary items |
8.04 |
7.78 |
33.40 |
|
|
|
|
|
|
|
|
PART II |
|
|
|
|
|
Particulars of Shareholding: |
|
|
|
|
|
Public
Shareholding: Number of shares |
23278609 |
23280109 |
23278609 |
|
|
Percentage
of share holding |
33.29% |
33.29% |
33.29% |
|
|
Promoters & Promoter group
shareholding a) Pledged/Encumbered Number of shares Percentage of shares (as a % of total shareholdings |
Nil |
Nil |
Nil |
|
|
of
promoter & promoter group) |
Nil |
Nil |
Nil |
|
|
Percentage
of shares (as a % of total share capital |
|
|
|
|
|
of the Company) |
Nil |
Nil |
Nil |
|
|
b)
Non-encumbered |
|
|
|
|
|
Number
of shares |
46648641 |
46647141 |
46648641 |
|
|
Percentage of shares (as a %
of total shareholdings of promoter & promoter group) |
100.00% |
100.00% |
100.00% |
|
|
Percentage
of shares (as a % of total share capital |
|
|
|
|
|
of the
Company) |
66.71% |
66.71% |
66.71% |
|
|
|
||||
|
B. INVESTOR
COMPLAINTS |
Quarter
Ended 31.03.2013 |
|
||
|
Pending at the beginning of the quarter |
Nil |
|
||
|
Received during the quarter |
6 |
|
||
|
Disposed of during the quarter |
6 |
|
||
|
Remaining unresolved at the end of the quarter |
Nil |
|
||
STATEMENT OF ASSETS & LIABILITIES
|
Particulars |
|
|
31.03.2013 |
|
|
|
|
Audited |
|
Shareholder's funds: |
|
|
|
|
(a) Share Capital |
|
|
699.272 |
|
(b) Reserves & Surplus |
|
|
16274.593 |
|
Sub Total: Shareholder's funds |
|
|
16973.865 |
|
Share application money pending allotment: |
|
|
0.000 |
|
Minority Interest |
|
|
0.000 |
|
Non Current Liabilities: |
|
|
|
|
(a) Long-term borrowings |
|
|
9531.401 |
|
(b) Deferred tax liabilities (net) |
|
|
2490.400 |
|
(c) Other Long Term Liabilities |
|
|
871.079 |
|
(d) Long term provisions |
|
|
142.211 |
|
Sub Total: Non Current Liabilities |
|
|
13035.091 |
|
Current Liabilities: |
|
|
|
|
(a) Short Term borrowings |
|
|
1886.543 |
|
(b) Trade payables |
|
|
1965.166 |
|
(c) Other Current Liabilities |
|
|
4509.128 |
|
(d) Short term provisions |
|
|
649.566 |
|
Sub Total: Current Liabilities |
|
|
9010.403 |
|
TOTAL-EQUITY AND LIABILITIES: |
|
|
39019.359 |
|
ASSETS |
|
|
|
|
Non Current Assets: (a) Fixed Assets |
|
|
|
|
Tangible Assets |
|
|
23618.022 |
|
Intangible Assets |
|
|
24.812 |
|
Capital Work in Progress |
|
|
1075.074 |
|
Intangible Assets under development |
|
|
0.000 |
|
(b) Non Current investments |
|
|
1692.988 |
|
(c) Long term loans and advances |
|
|
2283.518 |
|
Sub Total: Non Current Assets |
|
|
28694.414 |
|
Current Assets: |
|
|
|
|
(a) Inventories |
|
|
4613.763 |
|
(b) Trade Receivables |
|
|
1152.703 |
|
(c) Cash and cash equivalents |
|
|
3324.573 |
|
(d) Short term loans and advances |
|
|
1167.058 |
|
(e) Other current assets |
|
|
66.848 |
|
Sub Total: Current Assets |
|
|
10324.945 |
|
TOTAL-ASSETS |
|
|
39019.359 |
Notes:
- The Board of Directors have recommended a Dividend of Rs. 6.50 per
share for the year 2012-13.
- The Competition Commission of India (CCI) has upheld the complaint
of Builders Association of India, alleging cartelisation by some cement
manufacturing companies including us and imposed a penalty of Rs. 1285.400
millions on the company. Based on expert legal Advice Company believes
that it has fair chances before the Competition Appellate Tribunal (COM
PAT) and has filed an appeal against the order before COMPAT. Accordingly
no provision has been made in accounts.
- The Company is engaged in only one business segment that is.
Cementitious Materials.
- Previous periods figures have been regrouped and recasted wherever
necessary.
- The above results have been reviewed by the Audit Committee and
approved by the Board of Directors at their meeting held on 11th
May, 2013.
PRESS REALEASE:
COMPAT DIRECTS CEMENT COS TO
PAY 10% OF RS 6,307CR PENALTY
The penalty was imposed on
the companies by fair trade regulator CCI for forming cartel in the sector.
May 17, 2013
The Competition Appellate Tribunal today directed
cement companies to pay 10 percent of an Rs 63070.000 millions penalty imposed
on them by fair trade regulator CCI for forming cartel in the sector.
Passing an interim order, a COMPAT bench headed by its Chairman Justice V S
Sirpurkar asked 11 cement producers along with their lobby group Cement
Manufacturer's Association (CMA) to pay around Rs 6300.000 millons within a
month.
The
tribunal also clarified that if the cement firms fail to deposit the amount
within a 30 days time-frame, their petition would be dismissed.
The
matter would now come up for final hearing in August. COMPAT had reserved its
order over a batch of petitions filed by various cement producers and CMA on
March 18 this year after hearing them on interim plea.
In the petitions, the cement producers had challenged Rs 63070.000 millions
penalty imposed on them by the Competition Commission of India (CCI) and the Rs
7.300 millions fine imposed on the CMA.
The cement companies charged with cartelisation include Lafarge India, India Cement , JP Associates , Binani Cement , Ambuja Cement , Madras Cement and J K Cement .
"The act and conduct of the cement companies establish that they are a
cartel. The Commission holds that the cement companies acting together have
limited, controlled and also attempted to control the production and price in
the market in India," CCI had said in its 258-page order.
CCI had found "cement manufacturers in violation of the provisions of the
Competition Act, 2002 which deals with anti-competitive agreements, including
cartels". The order was passed following probe by CCI Director General
(Investigation) on a complaint filed by Builders Association.
FIXED ASSETS:
- Goodwill
- Freehold Land
- Leasehold Land
- Buildings
- Plant & Machinery
- Railway Sidings
- Rolling Stock
- Furniture, Fixtures and Office
- Equipments
- Vehicles
- Computer 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 exist to suggest that subject is or was
the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper payments
to government officials for engaging in prohibited transactions or with
designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l Anti-Money
Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws, regulations
or policies that prohibit, restrict or otherwise affect the terms and
conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.56.49 |
|
|
1 |
Rs.86.00 |
|
Euro |
1 |
Rs.73.68 |
INFORMATION DETAILS
|
Report Prepared
by : |
ANK |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
5 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--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 |
|
DEFAULTER |
|
|
|
--RBI |
YES/NO |
NO |
|
--EPF |
YES/NO |
NO |
|
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.