MIRA
INFORM REPORT
|
Report Date : |
13.06.2013 |
IDENTIFICATION DETAILS
|
Name : |
GAMMON INDIA LIMITED |
|
|
|
|
Registered
Office : |
Gammon House,
Veer Savarkar Marg, Prabhadevi, Mumbai – 400 025, |
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Country : |
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|
Financials (as
on) : |
31.03.2012 |
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|
|
|
Date of
Incorporation : |
15.06.1922 |
|
|
|
|
Com. Reg. No.: |
11-000997 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs. 275.000 Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
L74999MH1922PLC000997 |
|
|
|
|
TAN No.: [Tax Deduction &
Collection Account No.] |
MUMG07937G |
|
|
|
|
PAN No.: [Permanent Account No.] |
AAACG3821A |
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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
: |
The Company is engaged mainly in one reportable segment Construction and Engineering activity |
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|
|
|
No. of Employees
: |
3699 (Approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
B (36) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
Maximum Credit Limit : |
USD 90000000 |
|
|
|
|
Status : |
Moderate |
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|
|
|
Payment Behaviour : |
Slow but correct |
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|
|
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Litigation : |
Exists |
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|
|
Comments : |
Subject is an
established company having a moderate track record. There appears
drastic dip in the net profitability during 2012. External borrowings seems
to be increasing over previous year bearing high interest cost which acts as
a threat to the liquidity. More over, GIL
has decided to approach its bankers through the corporate debt restructuring
process for restructuring the company’s debt. However, trade
relations are fair. Business is active. Payment terms are reported as slow
but correct. The company can
be considered for business dealings with some caution. |
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 – March 31st, 2013
|
Country Name |
Previous Rating (31.12.2012) |
Current Rating (31.03.2013) |
|
India |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
EXTERNAL AGENCY RATING
|
Rating Agency Name |
CARE |
|
Rating |
Long Term Bank Facility = B |
|
Rating Explanation |
High risk of default |
|
Date |
20.03.2013 |
|
Rating Agency Name |
CARE |
|
Rating |
Short Term Bank Facilities = A4 |
|
Rating Explanation |
Minimal degree of safety and high credit risk. |
|
Date |
20.03.2013 |
RBI DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available RBI Defaulters’ list.
EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of
31-03-2012.
LOCATIONS
|
Registered/Head Office : |
Gammon House,
Veer Savarkar Marg, Prabhadevi, Mumbai – 400 025, Maharashtra, India |
|
Tel. No.: |
91-22-66614000 / 24306761 / 24301084 / 6744 4000 (Extn : 4050) |
|
Fax No.: |
91-22-24300529 / 24300221 / 66614025 |
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E-Mail : |
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|
Website : |
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Corporate Office : |
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|
|
|
|
Factory : |
v Parbati Hydro Electric Project, Village and
Post Office – Sainj, District Kullu, Himachal Pradesh, India v Teesta Head Race Tunnel, Makha Post
Singtam, District – East Sikkim – 737134, v Kaiga Nuclear Power Project, Unit 3 and 4 Kaiga,
District – Uttar Kannada - 581400, Karnataka, India v
Chennai Water Supply
Augmentation Project, Plot No. 32, Chandran Nagar, CLC Works Road, Chromepet,
Chennai – 600044, Tamilnadu, India v
Kalapakkam
Reactor Building, Salai Street, Meyyur, Sadras, Kalpakkam – 603 102,
Tamilnadu, India v
New
Brahmaputra Bridge, Ward No. 1, Sadilapur – 781 012, Guwahati, India v
Prabatri
H. E. Project – Stage – III, C/o. Bhagat Singh and Sons, VPO Larji, District
– Kullu, Himachal Pradesh, India v
Sewa
Hydroelectic Project Stage – II, Vill: Gatti, Po: Bani, Tehsil: Basoli,
District: Kathua (Jammu and Kashmir), India v
Anji
Khad Bridge Project, Post Granmore, Gita Nagar, District. Reasi – 182 311,
Jammu, India v
DMRC
Noida – BC 12 and BC 13, Adjacent to Noida Sarita Vihar Road, Plot No.4,
Sector 94, Noida, Uttar Pradesh, India v
Bihar
Corrindor – Phase II, Camp Madhubani, At Village and Post: Madhubani, (12 KM
From Pratapganj, Via Pratapganj), District Surpoul, Bihar, India |
DIRECTORS
As on 31.03.2012
|
Name : |
Mr. Peter Gammon |
|
Designation : |
Chairman Emeritus |
|
|
|
|
Name : |
Mr. Abhijit Rajan |
|
Designation : |
Chairman and Managing Director |
|
Qualification : |
B. Com L.S. E. |
|
Date of Appointment : |
17.05.1991 |
|
|
|
|
Name : |
Mr. Himanshu Parikh |
|
Designation : |
Executive Director /
Domestic Operations |
|
Qualification: |
B.com |
|
Date of Appointment: |
02.08.2004 |
|
|
|
|
Name : |
Mr. Rajul A Bhansali |
|
Designation : |
Executive Director /
International Operations |
|
Qualification: |
Graduate (Chartered Accountant) |
|
Date of Appointment: |
30.03.2003 |
|
|
|
|
Name : |
Mr. Digambar C. Bagde |
|
Designation : |
Executive Director / Deputy Managing Director / Transmission and Distribution Business |
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|
|
|
Name : |
Mr. Chandrahas C. Dayal |
|
Designation : |
Non- Executive Director |
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|
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|
Name : |
Mr. Atul Dayal |
|
Designation : |
Non- Executive Director |
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|
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|
Name : |
Mr. Jagdish C. Sheth |
|
Designation : |
Non- Executive Director |
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|
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|
Name : |
Mrs. Urvashi Saxena |
|
Designation : |
Non- Executive Director |
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|
|
|
Name: |
Mr. Atul Kumar shukla
|
|
Designation : |
Non- Executive Director |
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|
|
|
Name: |
Mr. Naval Cohudhary |
|
Designation : |
Non- Executive Director |
KEY EXECUTIVES
|
Name : |
Ms. Gita Bade |
|
Designation : |
Company Secretary and compliance |
|
Tel No.: |
91-22-66614050 |
|
E-Mail: |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 31.03.2013
|
Category of
Shareholder |
No. of Shares |
Percentage of
Holding |
|
(A) Shareholding of Promoter and Promoter Group |
|
|
|
|
|
|
|
|
1773164 |
1.30 |
|
|
43272555 |
31.70 |
|
|
45045719 |
33.00 |
|
|
|
|
|
|
3086435 |
2.26 |
|
|
3086435 |
2.26 |
|
Total shareholding of Promoter and Promoter Group (A) |
48132154 |
35.26 |
|
(B) Public Shareholding |
|
|
|
|
|
|
|
|
8769022 |
6.42 |
|
|
2679454 |
1.96 |
|
|
75000 |
0.05 |
|
|
31768089 |
23.27 |
|
|
43291565 |
31.72 |
|
|
|
|
|
|
17667230 |
12.94 |
|
|
|
|
|
|
12457855 |
9.13 |
|
|
2372527 |
1.74 |
|
|
12579137 |
9.22 |
|
|
168570 |
0.12 |
|
|
4684720 |
3.43 |
|
|
326520 |
0.24 |
|
|
5825045 |
4.27 |
|
|
969863 |
0.71 |
|
|
85253 |
0.06 |
|
|
519166 |
0.38 |
|
|
45076749 |
33.02 |
|
Total Public shareholding (B) |
88368314 |
64.74 |
|
Total (A)+(B) |
136500468 |
100.00 |
|
(C) Shares held by Custodians and against which Depository
Receipts have been issued |
0 |
0.00 |
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
Total (A)+(B)+(C) |
136500468 |
0.00 |
BUSINESS DETAILS
|
Line of Business : |
The Company is engaged mainly in one reportable segment
Construction and Engineering activity |
|
|
|
|
Products : |
·
Bridges ·
Tunnels ·
Dams |
PRODUCTION STATUS (As on 31.03.2011)
|
Particulars |
Units |
|
Conductors |
|
Installed Capacity |
MT |
110000 p.a. |
36000 p.a. |
|
Actual Production including job work |
MT |
102525 p.a. |
11916155 p.a. |
GENERAL INFORMATION
|
No. of Employees : |
3699 (Approximately) |
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Bankers : |
· Canara Bank · Punjab National Bank · Allahabad Bank · ICICI Bank · Syndicate Bank · IDBI Bank · Oriental Bank of Commerce · Bank of Baroda ·
DBS Bank Limited |
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Facilities : |
(Rs.
In Millions)
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Banking
Relations : |
-- |
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|
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Auditors : |
|
|
Name : |
Natvarlal Vepari and Company Chartered
Accountants |
|
Address : |
Oricon House, 4th Floor, 12, K. Dubash Marg, Mumbai – 400023, Maharashtra, India |
|
Tel. No.: |
91-22-67527100 |
|
Fax No.: |
91-22-67527101 |
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E-Mail : |
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Subsidiaries / Fellow
Subsidiaries: |
·
Andhra Expressway Limited ·
Ansaldocaldai Boilers India Private Limited ·
Aparna Infraenergy India Private Limited ·
ATSL BV, Netherland ·
ATSL Infrastructure Projects Limited ·
Associated Transrail Structures Limited, Nigeria ·
Campo Puma Oriente SA ·
Chitoor Infra Company Private Limited ·
Cochin Bridge Infrastructure Company Limited ·
Deepmala Infrastructure Private Limited ·
Dohan Renewable Energy Private Limited ·
Earthlink Infrastructure Projects Private Limited ·
Franco Tosi Hydro Private Limited ·
Franco Tosi Meccanica S.p.A. ·
Franco Tosi Turbines Private Limited ·
Gactel Turnkey Projects Limited ·
Gammon and Billimoria Limited ·
Gammon and Billimoria LLC ·
Gammon Holdings (Mauritius) Limited ·
Gammon Holdings BV ·
Gammon Infrastructure Projects Limited ·
Gammon International BV ·
Gammon International FZE ·
Gammon International LLC ·
Gammon Italy S.r.l. ·
Gammon Logistics Limited ·
Gammon Power Limited ·
Gammon Projects Developers Limited ·
Gammon Realty Limited ·
Gammon Renewable Energy Infrastructure Limited ·
Gammon Retail Infrastructure Private Limited ·
Gammon Road Infrastructure Limited ·
Gammon Seaport Infrastructure Limited ·
Ghaggar Renewable Energy Private Limited ·
Gorakhpur Infrastructure Company Limited ·
Haryana Biomass Power Limited ·
Indori Renewable Energy Private Limited ·
Jaguar Projects Developers Limited ·
Kasavati Renewable Energy Private Limited ·
Kosi Bridge Infrastructure Company Limited ·
Lilac Infrastructure Developers Limited ·
Marine Projects Services Limited ·
Markanda Renewable Energy Private Limited ·
Metropolitan Infrahousing Private Limited ·
Mumbai Nasik Expressway Limited ·
P.Van Eerd Beheersmaatschappaji BV ·
Pataliputra Highway Limited ·
Patna Buxar Highways Limited ·
Patna Highway Projects Limited ·
Pravara Renewable Energy Limited ·
Preeti Township Private Limited ·
Rajahmundry Expressway Limited ·
Rajahmundry Godavari Bridge Limited ·
Ras Cities And Townships Private Limited ·
SAE Powerlines S.r.l. ·
SAE Transmission India Limited ·
Satluj Renewable Energy Private Limited ·
Segue Infrastructure Projects Private Limited ·
Sikkim Hydro Power Ventures Limited ·
Sirsa Renewable Energy Private Limited ·
Tada Infra Development Company Limited ·
Tangri Renewable Energy Private Limited ·
Tidong Hydro Power Limited ·
Transrail Lighting Limited ·
Vijaywada Gundugolanu Road Projects Private
Limited ·
Vizag Seaport Private Limited ·
Yamuna Renewable Energy Private Limited ·
Youngthang Power Ventures Limited |
|
|
|
|
Associates and
Group Companies |
·
Eversun Sparkle Maritime Services Private Limited ·
Modern Toll Roads Limited ·
Finest S.p.A. Italy |
|
|
|
|
entities Where
Control exists |
·
Devyani Estate and Properties Private Limited ·
First Asian Capital Resources Private Limited ·
Masayor Enterprises Limited ·
Nikhita Estate Developers Private Limited ·
Pacific Energy Private Limited |
|
|
|
|
Joint Ventures : |
·
Afghanistan ATSL AEPC Consortium ·
BBJ Gammon ·
Bhutan Consortium Jyoti Structures Limited and
Gammon India Limited ·
Blue Water Iron Ore Terminal Private Limited ·
Consortium between SAE Powerlines S.r.l. and ATSL ·
Consortium SAE - GAMMON ·
Gammon - FCEP - Joint Venture - Nigeria ·
Gammon Al Matar JV ·
Gammon Ansaldo (Kakrapara BOT Pkg.I) |
CAPITAL STRUCTURE
As on 31.03.2012
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
355000000 |
Equity Shares |
Rs.2/- each |
Rs.710.000 Millions |
|
3000000 |
6% Optionally Convertible Preference Shares |
Rs.350/- each |
Rs.1050.000 Millions |
|
|
Total |
|
Rs.1760.000
Millions |
Issued Capital:
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
137355208 |
Equity Shares |
Rs.2/- each |
Rs.274.700
Millions |
|
|
|
|
|
Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
135774668 |
Equity Shares |
Rs.2/- each |
Rs.271.600
Millions |
|
Add : |
Share Forfeiture Account |
|
Rs. 3.400
millions |
|
|
(Money received in respect of 170948 Rights shares of Rs. 10/- each
forfeited ) |
|
|
|
|
Total |
|
Rs.275.000 Millions |
Issued Share Capital includes 725,800 shares of Rs.2/- each kept in abeyance.
Share Forfeiture account includes Rs.2.600 Millions of Share Premium collected on application in respect of forfeited shares.
Reconciliation of
number of shares outstanding
Rs. In Millions
|
Particulars |
As at 31-Mar-2012 |
|
|
|
No of Shares |
Amount |
|
As at the beginning of the year |
135,739,182 |
271.500 |
|
Add : Issued during the year - ESOP |
35,486 |
0.100 |
|
Issued during the year - Conversion of Warrants |
- |
- |
|
As at the end of the year |
135,774,668 |
271.600 |
Details of Shareholding
in excess of 5%
Rs. In Millions
|
Name of Shareholder |
As at 31-Mar-2012 |
|
|
|
No of Shares |
% |
|
Pacific Energy Private Limited |
18,013,015 |
13.20 |
|
Warhol Limited |
13,437,359 |
9.84 |
|
Devyani Estate and Properties Private Limited |
11,782,805 |
8.63 |
Aggregate number of
equity shares issued for consideration other than cash during five years
immediately preceding the reporting date
|
Particulars |
No of Shares |
|
Equity Shares issued as consideration on merger of Associated Transrail Structures Limited with the Company |
20,106,106 |
|
Total |
20,106,106 |
Shares reserved under
options to be given
43,580 (Previous Year 92,466) Equity shares have been reserved for issue as ESOP. Refer Note No. 33 for details of the ESOP Shares and Scheme.
Terms/rights attached
to equity shares
The Company has only one class of equity shares having a par value of Rs. 2/- each. Each holder of equity share is entitled to one vote per share. The distribution will be in proportion to the number of equity shares held by the shareholders.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the Company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by the shareholders.
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
|
31.03.2012 |
31.03.2011 |
|
I.
EQUITY
AND LIABILITIES |
|
|
|
|
(1)Shareholders' Funds |
|
|
|
|
(a) Share Capital |
|
275.000 |
274.900 |
|
(b) Reserves & Surplus |
|
22244.800 |
20893.100 |
|
(c) Money received against share warrants |
|
0.000 |
0.000 |
|
|
|
|
|
|
(2) Share Application money pending allotment |
|
0.000 |
0.000 |
|
|
|
|
|
|
(3) Non-current liabilities |
|
|
|
|
(a) long-term borrowings |
|
4691.700 |
4419.000 |
|
(b) Deferred tax liabilities (Net) |
|
671.900 |
814.300 |
|
(c) Other long term liabilities |
|
2924.800 |
3162.000 |
|
(d) long-term provisions |
|
132.700 |
44.200 |
|
|
|
|
|
|
(4) Current liabilities |
|
|
|
|
(a) Short term borrowings |
|
22370.600 |
16580.300 |
|
(b) Trade payables |
|
14652.800 |
11774.200 |
|
(c) Other current liabilities |
|
9299.100 |
8667.000 |
|
(d) Short-term provisions |
|
150.400 |
251.000 |
|
TOTAL |
|
77413.800 |
66880.000 |
|
|
|
|
|
|
II. ASSETS |
|
|
|
|
(1) Non-current assets |
|
|
|
|
(a) Fixed Assets |
|
|
|
|
(i) Tangible assets |
|
12885.300 |
13262.300 |
|
(ii) Intangible Assets |
|
64.100 |
37.400 |
|
(iii) Capital work-in-progress |
|
573.200 |
485.300 |
|
(iv) Intangible assets under development |
|
0.000 |
0.000 |
|
(b) Non-current Investments |
|
2041.900 |
1939.600 |
|
(c) Deferred tax assets (net) |
|
0.000 |
0.000 |
|
(d) Long-term Loan and Advances |
|
10781.400 |
9518.800 |
|
(e) Long Term Trade Receivable |
|
6524.400 |
6516.900 |
|
(f) Other Non-current assets |
|
293.700 |
185.700 |
|
|
|
|
|
|
(2) Current assets |
|
|
|
|
(a) Current investments |
|
45.300 |
53.400 |
|
(b) Inventories |
|
18085.200 |
14881.000 |
|
(c) Trade receivables |
|
13739.300 |
10477.900 |
|
(d) Cash and cash equivalents |
|
856.400 |
573.400 |
|
(e) Short-term loans and advances |
|
9198.000 |
4572.800 |
|
(f) Other current assets |
|
2325.600 |
4375.500 |
|
TOTAL |
|
77413.800 |
66880.000 |
|
SOURCES OF FUNDS |
|
|
31.03.2010 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
|
|
258.300 |
|
|
2] Share Application Money |
|
|
203.500 |
|
|
3] Reserves & Surplus |
|
|
18987.200 |
|
|
4] (Accumulated Losses) |
|
|
0.000 |
|
|
NETWORTH |
|
|
19449.000 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
|
|
4885.500 |
|
|
2] Unsecured Loans |
|
|
8060.100 |
|
|
TOTAL BORROWING |
|
|
12945.600 |
|
|
DEFERRED TAX LIABILITIES |
|
|
717.300 |
|
|
|
|
|
|
|
|
TOTAL |
|
|
33111.900 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
|
|
10843.500 |
|
|
Capital work-in-progress |
|
|
846.400 |
|
|
|
|
|
|
|
|
INVESTMENT |
|
|
1978.400 |
|
|
DEFERREX TAX ASSETS |
|
|
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
|
|
13091.500
|
|
|
Sundry Debtors |
|
|
17636.800
|
|
|
Cash & Bank Balances |
|
|
724.800
|
|
|
Other Current Assets |
|
|
434.200
|
|
|
Other Non-Current Assets |
|
|
0.000
|
|
|
Loans & Advances |
|
|
10655.500
|
|
Total
Current Assets |
|
|
42542.800 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
|
|
12489.600
|
|
|
Other Current Liabilities |
|
|
10307.800
|
|
|
Provisions |
|
|
301.800
|
|
Total
Current Liabilities |
|
|
23099.200 |
|
|
Net Current Assets |
|
|
19443.600
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
|
|
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
|
|
33111.900 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
|
|
SALES |
|
|
|
|
|
|
|
Revenue from Operations (Net) |
54732.300 |
|
44681.100 |
|
|
|
Other Operating Revenue |
598.900 |
718.100 |
|
|
|
|
Other Income |
1572.200 |
2808.200 |
580.900 |
|
|
|
TOTAL (A) |
56903.400 |
58387.900 |
45262.000 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of Material Consumed |
23955.200 |
|
|
|
|
|
Purchase of Stock in Trade |
1662.500 |
1616.200 |
|
|
|
|
Change in Inventory - WIP & FG |
(2954.100) |
(831.800) |
|
|
|
|
Subcontracting Expenses |
13882.100 |
15617.600 |
|
|
|
|
Employee Benefit Expenses |
5137.600 |
4587.300 |
41012.200 |
|
|
|
Foreign Exchange (Gain)/Loss |
(148.500) |
124.900 |
|
|
|
|
Other Expenses |
9158.500 |
8862.400 |
|
|
|
|
Exceptional Items |
40.200 |
27.200 |
|
|
|
|
TOTAL (B) |
50733.500 |
53370.300 |
41012.200 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
6169.900 |
5017.600 |
4249.800 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
3634.200 |
2336.500 |
1396.600 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
2535.700 |
2681.100 |
2853.200 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/ AMORTISATION (F) |
1019.900 |
917.100 |
740.600 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
1515.800 |
1764.000 |
2112.600 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
645.400 |
579.500 |
855.500 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
870.400 |
1184.500 |
1257.100 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
3416.700 |
2733.600 |
2314.300 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
100.000 |
120.000 |
297.500 |
|
|
|
Amount Transferred to Debenture Redemption Reserve |
474.300 |
455.000 |
383.800 |
|
|
|
Amount Transferred from Debenture Redemption Reserve |
0.000 |
(191.500) |
0.000 |
|
|
|
Dividend from Own Shares |
(2.300) |
(5.800) |
(3.500) |
|
|
|
– Equity Shares |
27.300 |
106.300 |
76.500 |
|
|
|
– Preference Shares |
0.000 |
0.000 |
60.700 |
|
|
|
Tax on Dividend |
4.400 |
17.400 |
22.800 |
|
|
BALANCE CARRIED
TO THE B/S |
3683.400 |
3416.700 |
2733.600 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Revenue from Overseas Project and receipts from World Bank aided projects in Foreign Currency |
447.500 |
326.600 |
461.400 |
|
|
|
Earnings in foreign currency – FOB |
1530.400 |
1190.900 |
2538.700 |
|
|
|
Others |
0.000 |
0.000 |
10.200 |
|
|
|
Interest |
212.100 |
131.600 |
0.000 |
|
|
|
Tower Testing Charges |
164.800 |
6.200 |
0.000 |
|
|
TOTAL EARNINGS |
2354.800 |
1655.300 |
3010.300 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
533.500 |
277.100 |
113.500 |
|
|
|
Stores & Spares |
38.100 |
84.500 |
96.200 |
|
|
|
Capital Goods |
78.200 |
760.900 |
570.000 |
|
|
TOTAL IMPORTS |
649.800 |
1122.500 |
779.700 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
|
|
|
|
|
|
Basic EPS |
6.41 |
9.16 |
10.72 |
|
|
|
Diluted EPS |
6.38 |
9.10 |
10.26 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2012 |
30.09.2012 |
31.12.2012 |
31.03.2013 |
|
Type |
1st
Quarter |
2nd Quarter |
3rd Quarter |
4th Quarter |
|
|
|
10861.800 |
12164.700 |
16325.600 |
|
Sales Turnover |
12621.500 |
10258.900 |
13685.100 |
15277.200 |
|
Total Expenditure |
11926.900 |
602.900 |
(1520.400) |
1048.400 |
|
PBIDT (Excl
OI) |
694.600 |
339.000 |
400.300 |
286.500 |
|
Other Income |
342.000 |
941.900 |
(1120.100) |
1334.900 |
|
Operating
Profit |
1036.600 |
1044.200 |
1260.500 |
1178.900 |
|
Interest |
950.500 |
0.000 |
0.000 |
(1090.600) |
|
Exceptional
Items |
0.000 |
(102.300) |
(2380.600) |
(934.600) |
|
PBDT |
86.100 |
280.100 |
266.300 |
263.800 |
|
Depreciation |
263.700 |
(382.400) |
(2646.900) |
(1198.400) |
|
Profit
Before Tax |
(177.600) |
12.000 |
(30.500) |
51.400 |
|
Tax |
18.500 |
0.000 |
0.000 |
0.000 |
|
Reported PAT |
(196.100) |
(394.400) |
(2616.400) |
(1249.800) |
|
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 |
(196.100) |
(394.400) |
(2616.400) |
(1249.800) |
KEY RATIOS
|
PARTICULARS |
|
31.03.2012 |
31.03.2011 |
31.03.2010 |
|
PAT / Total Income |
(%) |
1.53
|
2.03 |
2.78 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
2.74
|
3.17 |
4.73 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
2.03
|
2.74 |
3.96 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.60
|
0.08 |
0.11 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Debt/Networth) |
|
10.74
|
0.99 |
1.85 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
0.95
|
0.94 |
1.84 |
LOCAL AGENCY FURTHER INFORMATION
|
Sr. No. |
Check List by Info
Agents |
Available in Report (Yes / No) |
|
1] |
Year of Establishment |
Yes |
|
2] |
Locality of the firm |
Yes |
|
3] |
Constitutions of the firm |
Yes |
|
4] |
Premises details |
No |
|
5] |
Type of Business |
Yes |
|
6] |
Line of Business |
Yes |
|
7] |
Promoter's background |
Yes |
|
8] |
No. of employees |
Yes |
|
9] |
Name of person contacted |
No |
|
10] |
Designation of contact person |
No |
|
11] |
Turnover of firm for last three years |
Yes |
|
12] |
Profitability for last three years |
Yes |
|
13] |
Reasons for variation <> 20% |
---------------------- |
|
14] |
Estimation for coming financial year |
No |
|
15] |
Capital in the business |
Yes |
|
16] |
Details of sister concerns |
Yes |
|
17] |
Major suppliers |
No |
|
18] |
Major customers |
No |
|
19] |
Payments terms |
No |
|
20] |
Export / Import details (if applicable) |
No |
|
21] |
Market information |
---------------------- |
|
22] |
Litigations that the firm / promoter involved in |
Yes |
|
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 |
Yes |
|
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 |
|
LITIGATION DETAILS |
||||||||
|
Bench:- Bombay |
|
|||||||
|
Stamp No:- |
CAFST/19448/2010 |
Failing Date:- |
30/07/2010 |
Reg. No.:- |
CAF/2886/2010 |
Reg. Date:- |
02/08/2010 |
|
|
|
||||||||
|
|
Main Matter |
|
||||||
|
Stamp No.:- |
FAST/14673/2006 |
Reg. No.:- |
FA/1520/2006 |
|
||||
|
Petitioner:- |
FRAMROC APRTMRNTS PRIVATE LIMITED |
Respondent:- |
GAMMON INDIA LIMITED |
|
||||
|
Petn. Adv.: |
MR. AMIN KHERADA |
Resp. Adv.: |
M/S. DESAI AND CHINOY |
|
||||
|
District:- |
BOMBAY |
|
||||||
|
|
||||||||
|
Bench:- |
SINGLE |
|
Category:- |
FOR DIRECTION |
|
|||
|
Status:- |
Pre-Admission |
Stage:- |
FOR ORDER |
|||||
|
Last Date:- |
05/08/2010 |
|
||||||
|
Last Coram:- |
REGISTRAR (JUDICIAL) |
|
||||||
|
|
|
|||||||
|
Act:- |
Order Act |
|||||||
UNSECURED LOAN
Rs.
In Millions
|
Particular |
As
on 31.03.2012 |
As
on 31.03.2011 |
|
Loans and Advances from Related Parties : |
49.800 |
0.000 |
|
Other Loans and
Advances: |
|
|
|
Buyers Credit |
604.500 |
673.900 |
|
Commercial Paper Maximum O/s during the year Rs.5500.000 Millions (Previous Year Rs.3400.000 Millions) |
2250.000 |
1450.000 |
|
Short Term Loans |
|
|
|
- From Banks |
14273.100 |
11332.200 |
|
- From Others |
0.000 |
202.100 |
|
Total |
17177.400 |
13658.200 |
FINANCIAL PERFORMANCE
AND OPERATIONS:
The year was a difficult period for the construction industry and for the Company. With fewer projects to bid for the order booking was sluggish. Competition continued to be intense due to low entry barriers resulting in smaller players underquoting to capture the projects. Further government inaction, delays in awarding projects, delays in clearances by various government agencies, bureaucratic apathy, rising inflation leading to an increase in prices of major construction raw materials such as steel, cement, bitumen leading to price escalation in contracts, squeeze on liquidity caused by higher interest costs, leading to delay in projects and delay in timely recoveries from clients all had a dampening effect on the overall performance of the Company. The impact led to pressures on the working capital and resulted in higher debt.
The Turnover of the Company on a Standalone basis stood at Rs.55330.000 Millions for the year ended 31st March, 2012 (Rs.55580.000 Millions previous year). Operating Profit (PBDIT) amounted to Rs.4600.000 Millions (Rs.2210.000 Millions previous year). After providing Rs.1020.000 Millions (Rs.920.000 Millions for the previous year) towards depreciation and Rs.650.000 Millions (Rs.580.000 Millions previous year) towards tax for current and deffered taxation, the net profit amounted to Rs.870.000 Millions (Rs.1180.000 Millions previous year). The annualized percentage decrease in turnover over previous year amounted to 0.04%. The order book position of the Company as on 31st March, 2012 stood at Rs.150780.000 Millions.
On a consolidated basis the turnover of the Gammon group stood at Rs.80380.000 Millions for the year ended 31st March, 2012. The annualized percentage decrease in turnover over previous year amounted to 8%. The group made a Loss of Rs.1051.400 Millions for the year ended 31st March, 2012 as compared to a Profit of Rs.1100.200 Millions in the previous year. This was mainly on account of increase in interest costs due to higher borrowings.
The recessionary trends in the infrastructure sector continues in the current financial year 2012-13. The Company has posted a Loss of Rs.196.100 Millions during the first quarter ended 30th June, 2012 . The Company has taken several critical steps for improving its funds flow, including strong austerity measures across the Company, the effects of which will be seen in the current financial year.
FINANCE:
During the year under review the Company did not raise any funds from the capital markets either by way of issue of equity/ADR/GDR The Company has obtained financial assistance from its consortium bankers to meet its short term working capital requirements.
During the year under review the Company did not raise any debt by way of issue of Secured Non-Convertible Debentures. The Company redeemed debentures aggregating to Rs.500.000 Millions. The total amount of outstanding Non-Convertible Debentures as on date is Rs.3240.000 Millions.
MANAGEMENT DISCUSSION AND ANALYSIS
OVERVIEW OF GAMMON
GROUP
Gammon India is amongst the largest infrastructure construction companies in India. Its track record spans significant landmark projects built over several decades, with a prominent presence across all sectors of civil engineering, design and construction. Besides its large scale of operations in the Construction and Infrastructure domain, Gammon has a dominant presence in energy business in which it operates in the hydro, nuclear and thermal power sectors. Gammon's projects cover businesses and projects involving highways, public utilities, environmental engineering and marine structures. Gammon's expertise also covers the design, financing, construction and operation of modern bridges, viaducts, and metro rail, both on a Build-Operate-Transfer (BOT) basis as well as contract execution. Gammon is also active in the Social Infrastructure sector through its operations in the realty project segment. Gammon overseas ventures includes a majority holding in Franco Tosi Meccanica, SAE Power lines and Sofinter group, Italy spanning the sectors of power and industrial boilers as well as waste and environment management systems.
ECONOMIC OVERVIEW,
INDUSTRY STRUCTURE AND DEVELOPMENT:
India's infrastructure sector continues to be a key driver of the nation's economic progress. In fact, infrastructure has emerged as a key driver for sustaining the robust growth of the economy and the government has been focusing on development of infrastructure. The Indian economy was estimated to grow by 6 % in 2011-12, after having grown at the rate of 8.4 % in each of the two preceding years. This indicates slowdown compared not just to the previous two years but 2003 to 2011 (except 2008-09). With agriculture and services continuing to perform well, India's slowdown can be attributed almost entirely to weakening industrial growth. Monetary policy was tightened by the Reserve Bank of India (RBI) during the year to control inflation and curb inflationary expectations. The global economic environment, which has been tenuous at best throughout the year, turned sharply adverse in September 2011 owing to the turmoil in the Eurozone, and questions about the outlook on the US economy provoked by rating agencies. There is no doubt that a part of India's slowdown is rooted in domestic causes. The persistent inflation that remained over 9 % for much of the year and needed to be tamed played a role.
An analysis of the creation of infrastructure in physical terms indicates that while the achievements in some sectors have been remarkable during the Eleventh Plan as compared to the previous Five-year Plans, there have been slippages in some sectors. The success in garnering private-sector investment in infrastructure through the public-private partnership (PPP) route during the Plan has laid solid foundation for a substantial step up in private-sector funding incoming years. PPPs are expected to augment resource availability as well as improve the efficiency of infrastructure service delivery.
REVEW OF OPERATIONS :
The year under review was a difficult period for the construction industry and for the Company. With fewer projects to bid for the order booking was sluggish. Competition continued to be intense due to low entry barriers resulting in smaller players underquoting to capture the projects. Further government inaction, delays in awarding projects, delays in clearances by various government agencies, bureaucratic apathy, rising inflation leading to an increase in prices of major construction raw materials such as steel, cement, bitumen leading to price escalation in contracts , squeeze on liquidity caused by higher interest costs, leading to delays in projects, and delays in timely recoveries from clients all had a dampening effect on the overall performance of the company. The impact led to pressures on the working capital and resulted in higher debt .
The turnover of the company on a standalone basis stood at Rs.55330.000 Millions for the year ended 31st March, 2012 Rs.55580.000 Millions previous year). Operating profit (PBDIT) amounted to Rs.4600.000 Millions (Rs.2210.000 Millions previous year). After providing Rs.1020.000 Millions (Rs.920.000 Millions for the previous year) towards depreciation and Rs.650.000 Millions (Rs.580.000 Millions previous year) towards tax for current and differed taxation, the net profit amounted to Rs.870.000 Millions (Rs.1180.000 Millions previous year). The annualized percentage decrease in turnover over previous year amounted to 0.04%.
On a consolidated basis the turnover of the Gammon group stood at Rs.80380.000 Millions for the year ended 31st March, 2012. The annualized percentage decrease in turnover over previous year amounted to 8%. The group made a loss of Rs.1051.400 Millions for the year ended 31st March, 2012 as compared to a Profit of Rs.1100.200 Millions. This was mainly on account of increase in interest costs due to higher borrowings.
The order book position of the company as on 31st March, 2012 stood at Rs.150780.000 Millions.
The recessionary trends in the infrastructure sector continues in the current financial year 2012-13. The company has posted a loss of Rs.196.100 Millions during the first quarter ended 30th June, 2012. The woes of the construction sector continue and have only been aggravated by recent directives issued by the Ministry of Finance to the banks prohibiting them from extending unsecured short term loans to corporates which were earlier easily available to the construction sector. This has severely affected the company's liquidity position and led to slowdown in execution of projects across most sites. The company has taken several critical steps for improving its funds flow, including several austerity measures across the company, the effects of which will be seen in the current financial year.
The company has approached its lenders for converting its short term unsecured borrowings to long term secured borrowings. In the process, the company is also looking towards divesting its non core assets and management is confident that before the end of the current financial year significant progress will be achieved to overcome the current situation.
SPECTRUM OF ACTIVITY AND REVIEW OF PERFORMANCE:
1. Transport Engineering:
The Company is engaged in the design and
construction of projects spanning roads, bridges, flyovers, metro railway
systems, marine structures, ports and airports.
(a) Roads:
India has one of the world's largest road
networks of 4.2 million km consisting of national highways, state highways,
major district roads and rural roads. National highways carry 40% of the total
traffic but constitute 2% of India's road network. State highways and rural and
urban roads, comprise the rest. About 65% of freight and 85% passenger traffic
is carried by the roads. About 22% of the total length of National Highways
(NHs) is single lane/ intermediate lane, about 53% is two lane standard, and
the balance 25% is four lane standard or more. In 2011-12, the achievement
under various phases of the NHDP up to December 2011 has been about 1,250 km
and projects have been awarded for a total length of about 4,374.9 km. Several
initiatives have been proposed by the Government to upgrade and strengthen
National Highways, to build expressways in high and dense traffic segments and
to improve the quality of roads. Foremost amongst such initiatives is the
National Highways Development Project (NHDP), covering a length over 55,000 km.
On the policy front, initiatives like pre-qualifications of bidders on an
annual basis rather than project-wise document submission have helped to
expedite the bidding process. All these initiatives have increased the scope of
work for the Company as an EPC Contractor. The Company is looking forward to
participating in these projects However progress in the roads and highways
sector has remained slow during the financial year ended 2012 mainly due to
delays in land acquisition and environmental and forest clearances, labour
issues and local law and order problems. Several initiatives have been taken
for resolving these issues and it is expected that during the Twelfth Plan road
construction work will pick up.
In the face of stiff competition the Company
secured the following projects during the year :
Improvement / Upgradation of Birpur - Balua -
Jadia - Meergunj - Murligunj - Udaikishangunj Road (SH - 91) length - 101.7 km,
Contract Package No. 4 of BSHP-II valued at Rs.3288.900 Millions. Upgradation of the Road from Davengere to Birur of SH-76 valued at Rs.
2025.700 Millions.
Four Laning of Patna - Buxar stretch of NH-30
from Km 0+000 to 124+850 (Existing Chainage Km 181+300 to Km 125+300 of NH-30
and ARA Bypass from Km 125+300 of NH-30 to Km 6+000 of NH-84 and Km 6+000 to Km
75+000 of NH-84) in the State of Bihar under NHDP Phase III valued at Rs.
10750.000 Millions.
During the year under review the Company
completed the Agra Makhanpur Road works project, the Nasik - Wadape Gonde 4
laning BOT Project, the Gajol Hilli Road Project in West Bengal and the Gaya
Rajauli Road works on SH-70.
The following works are under execution :
Design and Construction of four lane km 0.002
km 32.27 of Gorakhpur Bypass on NH-28 in the state of Uttar Pradesh on annuity
basis valued at Rs.5600.000 Millions.
Widening and strengthening to four-lane of
existing single / intermediate lane carriageway of National Highway No. 57
Section from Km. 230.00 to Km. 190.00 in the State of Bihar on East West
Corridor under NHDP, Phase -
II, Pkg. No. C-II/BR-3 valued at Rs.3565.100 Millions.
Arunachal Road Works (SEPPA ROAD) valued at
Rs.875.500 Millions.
Improvement/ Upgradation of
Dumuria-Imamganj-Sherghati-Karamain-Mathurapur-Guraru-Ahiyapur-Tikari-Mau-Kurtha-Kinjar-Paligunj-Ranitalab
Road (SH-69) length 153.00 km (Contract Package No.2) valued at Rs.3135.000 Millions.
Western Transport Corridor, TumkurHaveri
Section of NH4 Project-Rehabilitation and upgrading of Chitrdurga-Harihar
Section (Km 207 to 284) in the state of Karnataka Pkg.-4 and Harihar-Haveri
Section (Km 284 to 340) in the State of Karnataka Pkg.-5 balance Work valued at
Rs.4042.200 Millions.
Upgradation of Hajipur-Muzaffarpur Section of
the existing NH-77 to four lane dual carriageway. New bypass starting at km
46.300 and connecting NH-28 East-West corridor at km 515.045 valued at
Rs.7500.000 Millions.
(b) Bridges, Metro Viaducts and
Flyovers:
In India, urban population is expected to
increase by at least 300 million, equalizing to 100 more new cities. This
growing population in the urban cities has led to deterioration in the physical
environment and quality of life. Road space and public transport is inadequate
for the growing urban population. Traffic congestion has become the bane of
most metropolitan cities in India. The demand on urban infrastructure has
reached an unprecedented level. Government has decided to develop
infrastructure to meet the basic needs of growing urban population by giving a
boost to Bridges, Flyovers, Metro Rail and Mono Rail projects in almost all
metropolitan cities of the country. The Dedicated Freight Corridor Corporation
is a Special Purpose Vehicle set up under the administrative control of
Ministry of Railways of India and will offer new opportunities for bridges,
rail track laying, signaling and telecommunications approximately valued at
Rs.50000.000 Millions. Cities like Delhi, Kolkata and Bangalore
have already called for extension of Metro Rail Projects, where the company is
aggressively bidding for and securing Metro rail jobs. During the year under
review the Company secured a project for Construction of Viaduct of 5.27 km
length in "NEW GARIA-AIRPORT CORRIDOR OF KOLKATA METRO RAIL LINE" for
RVNL of value Rs.2249.700 Millions.
The following Projects were completed during
the year:
(1) Construction of Bridges at different locations on Gulbarga, Bidar,
Bellary, Raichur and Koppal Districts of Karnataka for KRDCL of value
Rs.505.000 Millions.
(2) Construction of Bridges at different locations on Mysore, Mandya,
Dakshinakannada, Chikkamaglur, Chamarajanagara, Kodagu, Udupi and Hassan
Districts of Karnataka for KRDCL of value Rs.575.000 Millions.
(3) Design, Construction, Development, Finance, Operation and Maintenance of
1.8 km long four lane Bridge across River Kosi with 8.2 km access roads and
bunds for flood protection on NH-57 in the Sapaul district of Bihar value
Rs.3470.000 Millions.
The following Projects currently under
execution are :
(1) Construction of Bridge and its approaches over river Yamuna Downstream of
existing bridge at Wazirabad, Delhi (Main bridge cable stayed) of value
Rs.6318.100 Millions.
(2) Construction of Bridge and its approaches over river Yamuna Downstream of
existing bridge at Wazirabad, Delhi (Construction of approaches) of value Rs.
3489.000 Millions.
(3) Cable Stayed Bridge across river Tapi in Surat of Gujarat State of value
Rs.1519.400 Millions.
(4) Design and Construction of Bridge over River Pawana, Flyover and ROB on
Kalewadi Phata to Dehu Alandi Road at Pune of value Rs.1039.100 Millions.
(5) Construction of Steel Superstructure and other ancillary Works of Rail
cum Road Bridge across river Ganga at Munger, Bihar of value Rs.3751.900 Millions.
(6) Design and Construction of Major Bridge across river Godavari of value
Rs.7000.000 Millions.
(7) Construction of New Brahmaputra Bridge near Guwahati on NH-31 in the
State of Assam of value Rs.3875.900 Millions.
(8) CMRL Design and Construction of underground stations at Government Estate
LIC Building, Thousands Lights and associated tunnels UG Package-2 and Gemini,
Tenoypet, Chamiers Road, Saidapet and associated tunnels UG Package-3 awarded
to Consortium of Gammon India Limited and OJSC Mosmetrostroy of value Rs.17476.100
Millions.
(c) PORTS
India has a 7,517 km long coastline with a
total of 13 major and 187 minor ports spread across nine maritime states. It
has one of the largest merchant shipping fleets and is ranked 16th amongst
maritime countries. In terms of volume, it carries about 95% of India's
overseas cargo and, in terms of value, it carries about 75% of the overseas
cargo. The Ministry of Shipping has set a target of awarding projects to create
244 MT of additional capacity at ports in 2012-13 to accommodate increasing
traffic. This will be spread across 42 projects at an estimated cost of
Rs.145000.000 Millions. The port sector has strong growth potential.
State Governments have played a huge role in encouraging domestic and foreign
private players to enter the sector by providing a favourable investment
climate and additional standard operating procedures. The private sector is
also encouraged to participate in port logistics services, in addition to the
development of ports and terminals.
The following jobs are currently under execution :
|
job description |
value (Rs. In Millions ) |
|
Design, Engineering, Procurement of Materials and Construction of Offshore Container Terminal (OCT) in Mumbai Harbour |
3974.900 |
|
Turnkey Engineering, Procurement and Construction (EPC) Contract for Civil, Structural, Architectural and allied works of the Sea Water Intake Outfall system along with all associated works for 2x520 (1040) MW Thermal Power Project at Vishakhapatnam (A.P) |
2670.000 |
POWER SECTOR- ECONOMIC SCENARIO
Availability and access to energy are
considered as catalysts for economic growth. India is the fifth largest
producer and consumer of electricity in the world after US, China, Japan and Russia.
Electricity production in India (excluding captive generation) stood at 877
billion units (bu) in 2011-12. Growing population, increasing penetration and
per capita usage has further provided the impetus, in addition to the expansion
in industrial activity, to boost electricity consumption. The National
Electricity Policy envisages "Power for all by 2012" and per capita
availability of power to be increased to over 1,000 units. With reference to
the Ministry of Power's reports the Working Group on Power has recommended a
plan size of about 82,200 MW for Twelfth Plan also. This would comprise hydro
projects totaling about 30,000 MW, thermal projects totaling 42,200 MW and
nuclear projects of about 10,000 MW capacities. Eying at the above said scenario,
there are good business opportunities to capitalize on the growth in the
industry.
(a)
Thermal power :
In the present situation thermal power
generation is 65% of the total power generation capacity. Government is
encouraging private players to be partners in the power sector development and
sector is de-licensed. The participation of private players in the thermal
power sector has made the sector more attractive to target and shown a growth
potential for the company.
Some of the thermal power projects currently
being executed by the company are as follows :
1. Civil Works and Structural Works for 3300 Mw TPP at Tiroda, Maharashtra
valued at Rs.3500.000 Millions.
2. Main Plant and Offsite Civil works Pkg. Vallur TPP, Tamilnadu valued at
Rs.4460.000 Millions.
3. Civil and Structural Steel Works for 2 X 600 MW TPP near Tuticorin in
Tamilnadu valued at Rs.4000.000 Millions.
4. GCW and Chimney for 2x600 MW TPP at Angul valued at Rs.2950.000 Millions.
The general outlook of the sector is positive
with availability of quality resources and competent human resource. The sector
is becoming highly competitive as the risks involved are minimal. Timely
delivery, quality, cost and safety are the essence to succeed in this sector.
At the same time it is a challenge to ensure availability of new contracts.
(b)
Hydro power :
India's energy portfolio today depends heavily on coal-based thermal energy, with hydropower accounting for only 26% of total power generation. Though government is emphasizing on the development of this renewable energy sector, there are many road blocks for conceiving any new Hydro electric project. The main reasons for the slow development are difficult and inaccessible potential sites, land acquisition and rehabilitation, environmental clearance, forest related issues, inter-state issues, geological surprises and contractual issues. A multi-pronged strategy has been adopted to harness the hydropotential resources in the country. Some of the policy measures and initiatives taken by the government are finalization of an investor-friendly New Hydro Policy 2008, a liberal National Rehabilitation and Resettlement Policy, and a 50,000 MW Hydroelectric Initiative and Mega Power Project Policy. All the provisions of Hydro Policy 2008 including merchant sale up to a maximum of 40% of the saleable energy is now applicable to all developers, i.e. private as well as public. Further cost plus tariff regime has been extended for public as well as private-sector hydro-power projects up to December 2015. During the year under review the Company secured two prestigious hydro project packages in Bhutan through international competitive bidding viz :
|
Project |
Scope |
Value (Rs. In Millions ) |
|
Bhutan HEP |
Punatsangchhu - II Hydroelectric Project (990 Mw) Contract Package C-2 Construction of Head Race Tunnel from Adit - I and Adit - II. |
3983.300 |
|
Mangadhechu HEP |
Construction of Headrace Tunnel including Construction of Adits (I, II, III, IV and V) and Associated Works of HRT Mangdechhu Hydroelectric Project Bhutan. |
3431.100 |
The Company is focusing on domestic as well as international market for exploiting opportunities available. Economic condition and overall liquidity crunch has forced private developers to defer their plan to go ahead with new hydro projects
Some of the Hydro Power Projects under execution are :
|
Project |
Scope |
Value (Rs. In Millions ) |
|
Parbati HE stage 2 |
Parbati Hydro Electric Project Stage-II Civil and Hydromechanical Works for Power House, Pressure Shaft, Surge Shaft and Part HRT (Lot-PB-3) for NHPC in Himachal Pradesh. |
6030.000 |
|
Koldam Hydro Electric Project |
Construction of Power House, Tail Race Channel, Service Building and Maintenance, Bay Work and Penstock Tunnel work including Design, Fabrication, Erection, testing, commissioning of four Penstock linear etc. including all labour, plant, equipment and material for execution of civil and structural works and associated miscellaneous works. |
2270.000 |
|
Parbati stage 3 |
Construction of Civil Works for Lot PB III, consisting of Head Works, Power Intake, Head Race Tunnel, Surge Shaft and Pressure Shaft, Waterways, Downstreams of Units, Power Station Civil Works, Cable Cum Ventilation Tunnel, Pothead Yard. |
3390.000 |
|
Rampur HEP |
Rampur Hydroelctric Project - Package 1.0 Construction of Civil Works for HRT Sta. 50.61m to 12900m including cut and cover section, River Diversion Works, Audits, Vehicular Gates etc. |
3824.400 |
|
Bhutan HEP |
Punatsangchhu-I Hydroelectric Project (1200 MW) Contract Package # MC at Construction of Headrace Tunnel from Adit-I and Adit-II. |
3999.400 |
|
Rangit-II |
Development of 66MW Rangit-II HEP at West Sikkim. |
1040.000 |
(c) Nuclear Power :
India has a flourishing and largely indigenous nuclear power program and expects to have 20,000 MW nuclear capacity on line by 2020 and 63,000 MW by 2032. It aims to supply 25% of electricity from nuclear power by 2050. Because India is outside the Nuclear Non-Proliferation Treaty, it was for34 years largely excluded from trade in nuclear plant or materials, which has hampered development of civil nuclear energy until 2009. Due to these trade bans and lack of indigenous uranium, India has uniquely been developing a nuclear fuel cycle to exploit its reserves of Thorium. Now, foreign technology and fuel are expected to boost India's nuclear power plans considerably. All plants will have high indigenous engineering content. India has a vision of becoming a world leader in nuclear technology due to its expertise in fast reactors and Thorium fuel cycle.
There are huge developments happening in recent years and Company already has the prequalification criteria to secure the new contracts. Gammon has completed the civil works of fast breeder reactor at Kalpakkam and other BOP structures.
The Company secured the following jobs in the nuclear power segment :
|
Project |
Value (Rs. In Millions ) |
|
Construction of Phase 11 Buildings for IGCAR. |
760.000 |
|
Turbine Building and Balance of Plants for 500MWe PFBR, Kalpakkam. |
810.000 |
(d) Industrial /Power Structures:
The Company has secured construction of industrial structure projects to the tune of X 408.5 crore. (excluding the job secured for civil works in Thermal Power industry). Industrial structure constructions are fast track jobs as the infrastructure is directly linked to planned production.
|
Project |
Value (Rs. In Millions ) |
|
General Civil works I (3 Units) for 3x660MW Sasan Ultra Mega Power. |
880.000 |
|
Raw water Intake system in Rihand Reservoir. |
227.800 |
|
Civil Structural and Architectural works of the Sea Water Intake Outfall system for 2x520 (1040)MW TPP at Vishakhapatnam. |
2670.000 |
|
Civil Works for CHP Expansion at 4x300MW Rosa Thermal Power Plant, Shahjahanpur UP. |
307.200 |
The company is also currently executing jobs for private players at Mundra, Jindal stainless steel factory construction at Duburi and civil works for JSW Steel Limited at Bellary
PIPELINE DIVISION:
During the year under review the Company completed the laying of 16" OD, 218km long Cross Country Petroleum Product Pipeline from Hile KBPL including Installation of Pipeline project valued at X 32.58 crore.
The following projects are under execution :
|
Project |
Value (Rs. In Millions ) |
|
Construction of 10" dia x 15km (approx) Steel Pipeline, Terminals and Associated Facilities for BahadurgarhTikrikalan Pipeline |
188.800 |
|
Laying of Pipeline and Associated facilities for Brahmaputra Petrochemical Complex of Brahmaputra Cracker and Polymer Limited, Lepetkata (Assam) |
505.700 |
However works valued at Rs.390.000 Millions balance is remaining to be completed.
WATER AND
ENVIRONMENT:
Urban population in India is projected to increase to 598 million in the year 2031 and the share of urban population is projected to increase from 31.2% in 2011 to about 40% in 2030. Continued demographic shift from rural to urban areas and rapid urbanization are posing a huge challenge in terms of creation and maintenance of minimum level of infrastructure and services. There is a need to upgrade urban infrastructure such as water supply, sewerage, solid waste management, urban roads, storm water drains etc.
Over the last five years, the Central and State Government has increased project investment in Water Supply Scheme at an annual rate of about 10%. Coastal cities, not supported by adequate natural potable water resources, are now looking at the option of Desalination of Sea Water. State Government of Maharashtra proposes to launch "Maharashtra Sujal and Nirmal Abhiyan (MSNA)" to ensure universal access to water supply and sanitation services.
During the year under review the Company under the JNNURM Scheme on DBO basis secured from BUIDCO the Project for Design, Construction, Installation, Commissioning, Management, Operation and Maintenance of Intake, RWPH, 220 MLD Water Treatment Plant and Water Supply Distribution Network in Patna (Bihar) aggregating to Rs.5488.300 Millions which will be executed through an SPV named 'Patna Water Supply Distribution Network Private Limited'.
Gammon has successfully executed challenging jobs and is hence able to meet stringent requirements in this segment for future jobs. An order booking target of Rs.5000.000 Millions is set accordingly for this sector, with a targeted turnover of around Rs.3500.000 Millions for FY 2012-13.
|
Project |
Value (Rs. In Millions ) |
|
Distribution systems for Mangalore South (West) Contract Package 1012-C. |
958.000 |
|
Distribution systems for Mangalore South (Central) Contract Package 1012-C. |
770.000 |
|
Distribution systems for Mangalore South (East) Contract Package 1012-C. |
785.000 |
|
EPC Contract of Jindal Intake Well at Brahmani River and related works for project at Duburi, Orissa. |
435.000 |
The following Jobs are currently under execution :
|
Project |
Value (Rs. In Millions ) |
|
Design Build Contract with Operation and Maintenance for three years for Distribution MS/DI/PVC/HDPE Pipeline U/G Sumps, ESRS, Staff quarters, Compound wall and Pump House, Pumping machineries with OandM for three years for Integrated Water Supply Scheme Phase II, Part II based on Sardar Sarovar Canal based Dist.- Surendranagar. |
1074.500 |
|
Design and Construction of a complete new 107 MLD capacity, Portable water supply Infrastructure project on turnkey basis for Guwahati City (South Guwahati Part). |
3497.000 |
|
Procurement of works for Supply, Installation, Construction and Commissioning of Rising and Transmission Main (Gravity Mains, pressure Mains) Reservoirs for South Central Zone. |
1757.200 |
|
Bangalore Water Supply and Sewerage Project- Contract Wise Procurement, Fabrication and Laying of Clear water Trunk main from Vajarahalli to HBR on the east of Bangalore. |
3094.600 |
|
Design, Engineering, Supply, Erection and Commissioning of Raw Water Intake project at Brahamana Gaon near Marthapur on Turnkey Basis. |
337.500 |
|
Design Build Operate Contract for Distribution Network for Narmada Canal based on Wankaner Group Water Supply Scheme of Wankaner, Morbi, Tankara taluka of Rajkot District. |
1082.800 |
CHIMNEYS AND COOLING
TOWERS:
Construction of Cooling towers and chimneys are high technology driven jobs and highly specialized activity. These structures are an integral part of the various industrial infrastructures like Power plants, Petroleum, Steel, Chemical, Sugar plants etc. Gammon is the leader in the construction of cooling towers and chimneys. The Company has in house technical capability and has a competent execution team who can build these highly specialized structures within time and budget maintaining highest quality and safety standards. Gactel Turnkey Projects Limited (GTPL) a wholly own subsidiary of Gammon India Limited has established itself as a complete solution provider for cooling tower constructions. The R and D department at GTPL is continuously working to improve the efficiency of the structures being created by Gammon. The value of work executed during the current year is X 762 crore and as on 1st April 2012 the value of work in hand is Rs. 13900.000 Millions.
TRANSMISSION AND
DISTRIBUTION BUSINESS:
The Eleventh Five Year Plan emphasised the need for removing infrastructure bottlenecks for sustained growth. The Government has proposed an investment of US $500 billion in infrastructure sectors through a mix of public and private sectors to reduce deficits in identified infrastructure sectors. The private sector is expected to be contributing nearly 36% of this investment. To cater to the ever growing power consumption, rapid industrialisation and huge energy deficit, the Government of India has planned to make large capital expenditure in the Eleventh Five Year Plan in the Power Generation, Transmission and Distribution segments and set a target of adding about 78000 MW of additional capacity of power generation in the Eleventh Five Year Plan and about 82000 MW capabilities of power generation in the Twelfth Five Year Plan. This will enable the Company to cater to the ever growing demand of power transmission and distribution.
The power sector in India has an estimated capacity addition of more than 1,60,000 MW during the period 2012-17. In order to provide availability of over 1,000 units of per capita electricity by the year 2012, the fund requirement for transmission system development and related schemes during Eleventh Five Year Plan period has been estimated as follows :
|
Sector |
Value (Rs. In Millions ) |
|
Central |
750000.000 |
|
State |
650000.000 |
|
Total |
1400000.000 |
The Planning Commission, in its approach paper has projected an investment of over Rs.45 Lakh crore during the Twelfth Plan (2012-17). It is projected that atleast 50% of this investment will come from the private sector against the 36% anticipated in Eleventh Plan and public sector investment will need to increase to over Rs. 22.5 lakh crore as against an expenditure of Rs.13.1 lakh crore during the Eleventh Plan. Financing infrastructure will, therefore, be a big challenge in the coming years and will require some innovative ideas and new models of financing. This entails expansion of transmission networks, strengthening of regional grids, building of more inter-related links and addition of inter-regional capacities of 23,600 MW, at 220 KV and above level. Opportunities also exist for the company in Build-Own-Operate-Transfer (BOT) projects for setting up transmission line.
Distribution:
R-APDRP and RGGVY schemes are expected to accelerate investment in the power distribution sector. The Government has set aside Rs.20800.000 Millions in the current budget under the APDRP Scheme as compared to Rs.8000.000 Millions for last year for bringing about improvement in the urban power distribution sector. The RGGVY scheme aims to bring about access to electricity to all rural households by the year 2012.
The T and D business of the Company mainly works with Powergrid, SEBs and Private sector clients on EPC basis.
The Company has set up a world class Tower Testing Station at Deoli and Wardha, Maharashtra capable of testing towers up to 1200 kv. The Tower Testing station has been acclaimed by domestic as well as international clients from the United States of America, Canada, Malaysia, Mexico etc. and the Company has successfully tested towers up to 765 kv. R and D Centre set up at Deoli and Wardha is duly recognised by Department of Science and Technology, Government of India as Research and Development Centre.
The Company has also been expanding to overseas countries such as the United States of America, Canada, Algeria, Kenya, Afghanistan, Ethiopia, Bhutan, Nigeria, Ghana, Sri Lanka, Oman, Rwanda, Botswana, Tanzania, Mozambique etc. and has been successful in penetrating Canadian markets with tower supply orders.
During the year 2011-12, projects worth X 975 crore, which includes 248 km of 765 Transmission lines, 670 kms of 400 kv lines of Powergird Corporation of India and 151 km of 220 kv Transmission lines for State Electricity Board were completed.
The Company has ISO 9001: 2008, ISO 14000:2004 and ISO 18001:2007 certifications for "Design, Development, Manufacture, Supply and Construction of Overhead Transmission Line for Turnkey Projects including Sub-station Structures, Microwave Towers and Similar structures" by an internationally reputed certification agency viz. Det Norske Veritas (DNV), Netherlands.
The ISO Certifications have enabled the Company to project a better image and inspire greater confidence amongst its clients. The certification continues to be authenticated by DNV through their audits every year.
INTERNATIONAL BUSINESS
:
Sofinter group
The consolidated Financial Statements of Sofinter Group as of 31st December 2011 showed a loss of Euro 1.9 million and would have been positive but for the one-time extra-ordinary charges of Euro 2.4 million.
In this difficult moment, with an unfavorable economic situation in which both industrial and financial markets are showing clear signs of downturn, the Sofinter Group has succeeded in achieving turn-around. The Group's debt situation improved drastically, as the careful management of projects allowed for a substantial recovery of current assets invested.
The Management implemented an internal restructuring plan, by way of cost reduction and rationalization of operational structure. A new partner B.T. Global Investors Limited subscribed shares in Sofinter S.p.A. bringing in Euro 18 million in cash. In November, 2011 the Group entered into an agreement to modify the Interbank Agreement originally signed in 2009, which facilitated the Group with incremental credit lines of € 50 million and opened up earlier closed lines sufficient to carry out the Industrial Plan for the period 2012-14.
Sofinter - Macchi and
SWS Division
Operating value of production increased from € 108 million to € 126 million demonstrating the recovery of sales achieved by the Macchi Division of Sofinter.
The business activity in 2011 led to a substantial consolidation of market position, with significant acquisitions from important global customers including Petrobras-Brasile and Sembcorp-Singapore.
Today, the Macchi Division's leadership in the
large-scale industrial boilers sector is recognized and consolidated at the
international level.
Continuous attention is also dedicated by the Company
to post-sales service, understood as both a service for the customer and also a
business opportunity.
The SWS Division is dedicated to the business
of water treatment for industrial use. This business includes plants for
Alteration, demineralization, degassing and principally desalination of sea
water with MED technology.
Sales activities in 2011 were principally
directed to providing various offers to international EPC contractors.
Currently, the business areas showing the greatest interest are the Middle East
and South America, areas in which commercial negotiations are underway with
good prospects for success.
The project portfolio as of 31st December 2011
for Macchi and SWS Division amounts to approximately € 168 million.
Ansaldo Caldaie S.p.A.
The Financial Statements as of 31st December
2011 show a production value of € 110 million, with a loss of € 1.3 million.
Despite difficult market and global financial
difficulties, Ansaldo Caldaie S.p.A. has continued with its intense sales
activities, and its backlog of offers awaiting awards has reached a significant
level. Production activities continued regularly, both at the factory and at
worksites, and the Company reached the production levels set by the contractual
milestones. As regards the profitability of projects, the levels were
maintained and in some cases also exceeded the anticipated levels.
This year the Company achieved its planned
EBITDA due to positive performance on its existing contracts, good performance
of its service and business and careful management of overhead costs. The
future looks promising with high demand expected as the Global Financial and
Political situation improves. Steps were taken to solidify the Company's
infrastructure to position it to address the market in the medium to long term.
The Company's reputation in the market for
having a strong, sound, technology base and good delivery capability remains
very positive. This will help secure future orders. In India the Company faced
a minor setback when the Supreme Court reversed the High Court's decision on
its qualification for NTPC projects based on a technicality. In 2012 the
Company will work together with NTPC to overcome this issue and be in a
position to bid for their future projects.
The area of growth has been in the order
intake of Service business which has grown by approximately 2.5 times from a
year ago. The spare parts business is almost the same year on year. The area of
growth has been in foreign markets with the share in the Italian market
declining with regard to the previous year.
The project portfolio as of 31st December 2011
amounts to approximately € 116 million.
Europower
Production value as of 31st December 2011 was
approximately € 14.7 million, a decrease of approximately € 2.6 million compared
to the previous year 2011 closed with a profit of € 0.8 million. The 2011
accounting period saw the Company involved in the development of its own
activities in the O and M sector, in Italy and abroad, and consolidating the
position already obtained in recent years despite the negative international
economic situation.
ITEA
Production value for the year 2011, of € 3.3
million, was lower than in 2010 and also takes account of € 1.1 million of
capitalization relating to research activities. The 2011 accounting period
closed with a significant loss of € 2.7 million. The shareholders Ansaldo
Caldaie S.p.A. and Sofinter S.p.A. made capital contributions to cover losses,
respectively, for the amounts of € 180,000 and € 1,320,000.
In the year 2011, the Company essentially
performed five main activities :
- It completed the start-up and test operations of the Itro plant in
Singapore , where the test was performed in the month of August;
- It continued the execution of the FEED (Front End Engineering Design) for
the ENEL plant;
- It developed and consolidated the relationship with ENI through the
execution of orders relating to studies and test campaigns in the Gioia del
Colle plant;
- It continued the development activities; and
- It continued and developed sales activities.
ITEA, together with Thermoenergy U.S.A. has
established a joint venture company in the United States to promote the ITEA
technology and obtain financing in the United States, including Government
funds, for the construction of a 50 MWe pilot plant, and in this context, is
preparing the documentation necessary for participation in the program recently
announced by the U.S. Department of Energy. This is a major step for ITEA
technology, the benefits of which will be known in the near future.
Franco Tosi Meccanica S.p.A. (FTM)
Despite the poor macroeconomic scenario, the
year 2011 has shown an increased value of production by 12.4% from € 68.3
million in the previous year to € 76.8 million. Despite best efforts FTM missed
revenue of atleast € 30 million due to continued lack of working capital credit
lines. The operating margin (EBIT) for the financial year 2011 shows a
significant improvement compared to the previous year, going from a negative
result of € 9.7 million to a positive value of € 3.7 million.
The company in 2011, has continued to confirm
its role as a quality manufacturer of power generation equipment as well as
consolidated its presence in the rehabilitation of existing plants,
particularly in the markets of Central Africa and South/Central America.
Overall the financial results of 2011 marks a
significant improvement over the previous year and has set the company firmly
back on course to recovery. The effective order back log is € 139 million.
While the recession has delayed the investments
and subdued the macro economic dynamics, the global outlook for the energy
market does not vary far from the preceding forecasts in the longer run. It is
expected that the burgeoning population in Central and South African countries,
would eventually leverage their vast natural resources and will fuel the growth
of power sector. Mature markets are expected to resort to life extension and
rehabilitation investments in their ageing power plants in the short and medium
term.
The implementation of the internal plan
involving activities to improve performance of production is in progress, with
the aim to :
-
Reduce costs
-
Improve Quality
-
Improve the service
granted to the Client.
During the year the positive impacts of the
said plan could be perceived, despite a still difficult market situation
SAE Power Lines S.r.L.
The Company in 2011, recorded a turnover of €
43.72 million, an EBITDA of € 0.3 million and PAT of € (1.65 million). Further,
the order book at the end of the financial year was € 55 million. Additionally
the company is well positioned on its bids which are approximately in the range
of € 100 million.
The activities of the Company relating to the
fabrication and erection of transmission towers and lines showed modest growth.
This is despite the pressure on liquidity and turmoil in the global markets.
However the prospects over the medium to long-term especially in markets in
North East and West Africa are encouraging as also in the emerging markets
including India, Brazil and the Middle East. The Company is also continuing its
focus on opportunities in the United States of America as well as Mexico.
Campo Puma Oriente S.A.
The Puma Block Contract signed in March 2008 for
a 20 year term, originally established as a Production Sharing Contract
underwent a contract renegotiation process to migrate to the newly established
Service Contract model implemented by the Hydrocarbon Ministry in Ecuador in
2010. The new contractual framework entitles the contractor to a
dollar-per-barrel fee which is adjusted on a yearly basis based on the
production price index, as reported by the U.S. Bureau of Labor Statistics.
Minimum Work Program obligations of the operator under the service contract,
however, remain unchanged.
The Puma Block Service Contract was signed and
registered on 1st Feb, 2011 for a 18 year term.
As at the end of financial year 2011 a
cumulative amount of USD 61 Million has been invested by both partners in the
development of the Puma Field. The Development activities included drilling of
seven new wells, installation of production facilities, and work-over
operations. The Puma Field is producing an average of 2,000 barrels of oil per
day (2012 average). The Puma Field has Proved Reserves of 8.2 million barrels,
probable reserves in the order of 1.46 million barrels, and 4 exploratory
prospects with excellent potential.
After a process that lasted 15 months, on
February 2011 Consorcio Pegaso was awarded the ISO 14001 environmental
certification by BUREAU-VERITAS™. These efforts have strengthened the
relationship with environmental authorities and is a major accreditation
accorded to very few Companies in the region.
REAL ESTATE BUSINESS :
Real estate plays a critical role in the
development of the Indian economy. It is the second largest employer after
agriculture. Over the next decade, the real estate sector is expected to grow
by 30%. The sector is divided into four sub-sectors: housing, retail,
hospitality, and commercial. The housing sub-sector contributes 5-6% to the
country's gross domestic product (GDP). Meanwhile, retail, hospitality and
commercial real estate are also growing significantly, catering to India's
growing needs of infrastructure. The construction industry ranks third among
the 14 major sectors in terms of direct, indirect and induced effects in all
sectors of the economy, according to a study done by ICRA. A unit increase in
expenditure in this sector has a multiplier effect and the capacity to generate
income as high as five times. The positive effects of growth in real estate
sector are spread over more than 250 ancillary industries. The Indian real
estate market size is expected to touch USD 180 billion by 2020.
Recent growth in the Indian economy has
stimulated demand for land and developed real estate across industries. Demand
for residential, commercial and retail real estate is rising throughout India,
accompanied by increased demand for hotel accommodation and improved social
infrastructure. Further, presence of a large number of Fortune 500 and other
reputed companies will attract more companies to initiate their operational
bases in India thus, creating more demand for corporate space. This sector is
today witnessing development in all areas such as - residential, retail and
commercial. Easier access to bank loans and higher earnings by the ultimate
user are some of the pivotal reasons behind the growing Indian real estate
sector
In this sector the Company undertakes contracts for construction of buildings. Most contractors in this are regional by nature and this a challenge for Gammon to compete on the price and delivery. Contracting is generally trade specific as it is more tax efficient and the emergence of new tax laws shall give newer opportunities for general contracting with increased responsibility and trade volume. Gammon India Limited has during the year secured projects in the buildings sector valued at Rs.15000.000 Millions spread across Mumbai and Bangalore region. The major clients include Runwal Group, Iskcon, Sattva Group and Godrej to name a few.
Some of the major projects under execution include :
Ø Iskcon temple project at Mayapur Kolkata.
Ø Runwal Greens, a high-rise residential development in the central suburb at Mulund, Mumbai.
Ø Salarpuria Gold one of the tallest Residential Tower of Sattva group at Bangalore.
Ø Runwal Elegant, a high-rise residential development at Andheri, Mumbai.
Ø Godrej Platinum, Bangalore a turnkey development of high end residential complex for Godrej Buildwell Private Limited.
Despite high inflation, rising interest rates and near absence of institutional funding. It still remains a high growth opportunity.
The Company through its subsidiaries has acquired substantial presence in the Real Estate Sector across India as follows :
1. Metropolitan Infra-housing Private Limited acquired 180 acres of Land in auction within the limits of Municipal Corporation of Kalyan and dombivali at a total cost of Rs.7260.000 Millions. The land belonged to the erstwhile Pal Peugeot Limited, and is proposed to be developed as a Township Project. In recent times this area is witnessing development with several real estate projects by reputed developers being undertaken there. As a result the market price has increased over the past few months. There are expected changes in the development rules for the area and a higher FSI is anticipated.
2. Deepmala Infrastructure Private Limited a subsidiary of the Company was incorporated as a Special Purpose Vehicle for execution of Central Business district at Bhopal. The project involves Procurement, Finance, Construction and development of 15 acres of prime area in South TT Nagar Bhopal. It is a PPP Project with a lease period of 30 years extendable thereafter for another 30 years at no additional costs. The project is named as Shristi CBd Bhopal. Project comprises of approx 2.3 m sft of mixed use development. Permissions have been obtained for shopping arcade and high street shopping, The construction work has been undertaken by the company and progressing well. The Company is in the process of obtaining approvals for the residential and office blocks.
3. Preeti Townships Private Limited, another subsidiary is holding 15 acres of Land within the limits of Municipal Corporation of Kalyan and dombivali.
4. The Company has also entered into a joint venture with Multiplex Constructions India Private Limited, an Indian arm of Brookfield Multiplex for construction of High Rise structure both residential and commercial. The innovations at Brookfield and quality standards of the Company complement each other for a sustained relationship in the field of Real Estate.
CONTINGENT
LIABILITIES
Rs. In Millions
|
Particular |
31.03.2012 |
31.03.2011 |
|
1. Liability on contracts remaining to be executed on Capital Accounts |
239.000 |
125.900 |
|
2. Counter Guarantees given to Bankers for Guarantees given by them and Corporate Guarantees, on behalf of subsidiary, erstwhile subsidiary, associate Companies stand at |
74439.500 |
65319.600 |
|
3. Corporate Guarantees and Counter Guarantees given to Bankers towards Company’s share in the Joint Ventures for guarantees given by them to the Joint Venture Project Clients |
5420.600 |
5563.100 |
|
4. Disputed Sales Tax liability for which the Company has gone into Appeal is |
297.100 |
246.600 |
|
5. Claims against the Company not acknowledged as debts |
561.100 |
472.600 |
|
6. Disputed Excise Duty Liability |
0.300 |
0.300 |
|
7. Disputed Customs Duty Liability |
-- |
3.200 |
|
8. Disputed Service Tax Liability |
211.300 |
186.100 |
|
9 Against bill discounting |
222.000 |
|
|
Since Realised |
(88.100) |
|
|
10 On partly paid shares |
-- |
|
|
11 In respect of Income Tax Matters |
197.000 |
|
|
12 Commitment towards capital contribution in subsidiary under contractual obligation |
473.600 |
|
|
13 Disputed stamp duty liability for assets acquired during amalgamation with erstwhile Associated Transrail Structures Limited |
49.300 |
|
14 There is a disputed Demand of UCO Bank pending since 1986, of US$ 436251 i.e. Rs.17.200 Millions. Against this, UCO Bank has unilaterally adjusted the Company’s Fixed Deposit of US$ 30584 i.e. Rs.1.200 Millions, which adjustment has not been accepted by the Company
15 The Company had deposited customs duty of Rs.22.000 Millions under protest in respect of certain machineries imported for the project in Sikkim. The Company contends that the import of machinery is duty free as per the Project Import regulations prevailing then. The Company has preferred an appeal against the levy of Custom Duty. Pending outcome of the appeal, the said amount is carried under Advances recoverable in cash or in kind
16 In respect of Joint Venture and operations in Oman, Gammon India Limited-AL Matar JV
17 Counter claims in arbitration matters referred by the Company – liability unascertainable
AUDITED FINANCIAL
RESULTS FOR THE QUARTER AND YEAR ENDED 31 MAR 2013
Rs. In Millions
|
S.No. |
|
Quarter Ended |
Year Ended |
|
|
|
Particulars |
31 Mar 2013 |
31 Dec 2012 |
31 Mar 2013 |
|
1 |
Income from
Operations |
|
|
|
|
|
Net Sales / Income from Operations |
16325.600 |
12164.700 |
5,1973.600 |
|
2 |
Expenses |
|
|
|
|
|
Cost of Material Consumed |
8004.500 |
6720.700 |
2,6213.600 |
|
|
Purchases of Stock-in-trade 1 |
910.900 |
360.800 |
2250.200 |
|
|
Change in inventory of WIP and FG |
(1087.400) |
315.400 |
(2650.900) |
|
|
Subcontracting Expenses |
3675.500 |
2678.300 |
1,1548.400 |
|
|
Employee Benefits Expenses |
1381.800 |
1213.800 |
5187.600 |
|
|
Depreciation and Amortisation |
263.800 |
266.300 |
1073.900 |
|
|
Other Expenses |
2391.900 |
2392.600 |
8575.900 |
|
|
Total Expenses |
15541.000 |
13947.900 |
5,2198.700 |
|
3 |
Profit/(Loss) from
Operations Before Other Income, Finance Costs |
784.600 |
(1783.200) |
(225.100) |
|
4 |
Interest & Other Income |
286.500 |
370.500 |
1324.200 |
|
5 |
Profit/(Loss) from Ordinary
Activities Before Finance Costs and Forex Fluctuation |
1071.100 |
(1412.700) |
1099.100 |
|
6 |
Finance Cost |
1178.900 |
1260.500 |
4434.100 |
|
7 |
Forex Fluctuation (Gain) / Loss |
24.200 |
(29.800) |
(2.200) |
|
8 |
Exceptional / Prior Period Items |
1066.400 |
- |
1066.400 |
|
9 |
Profit Before Tax |
(1198.400) |
(2643.400) |
(43,9.200) |
|
10 |
Tax Expenses |
51.400 |
(27.000) |
57.500 |
|
11 |
Net Profit/(Loss)
for the period |
(1249.800) |
(2616.400) |
(44,6.700) |
|
12 |
Paid-up Equity Share Capital (Face Value Rs.2/- per Equity Share) |
275.000 |
275.000 |
275.000 |
|
13 |
Reserves, excluding Revaluation Reserve as per Audited Balance Sheet |
|
|
1,5737.200 |
|
14 |
Earning Per Share (Rupees) |
|
|
|
|
|
Basic |
(9.20) |
(19.27) |
(32.82) |
|
|
Diluted # |
(9.23) |
(19.27) |
(32.82) |
|
15 |
Ratio Debt Service Coverage Ratio(DSCR)* |
|
|
(1-57) |
|
|
Interest Service Coverage Ratio (ISCR)** |
|
|
0.24 |
|
A |
Particulars of Shareholding |
|
|
|
|
1 |
Public Shareholding |
|
|
|
|
|
- Number of Shares |
8,83,68,314 |
8,83,68,314 |
8,83,68,314 |
|
|
- Percentage of Shareholding |
64.74% |
64.74% |
64.74% |
|
2 |
Promoters & Promoter Group Shareholding |
|
|
|
|
|
Pledge/ Encumbered |
|
|
|
|
|
- Number of Shares |
1,15,75,000 |
1,16,45,000 |
1,15,75,000 |
|
|
- Percentage of Shares (as a % of total Shareholding of Promoter & Promoter group) |
24.05% |
24.19% |
24.05% |
|
|
(as a % of total Share Capital of the Company) |
8.48% |
8.53% |
8.48% |
|
|
Non-encumbered |
|
|
|
|
|
- Number of Shares |
3,65,57,154 |
3,64,87,154 |
3,65,57,154 |
|
|
- Percentage of Shareholding (as a % of total Shareholding of Promoter & Promoter group) |
75.95% |
75.81% |
75.95% |
|
|
(as a % of total Share Capital of the Company) |
26.78% |
26.73% |
26.78% |
|
B |
Investor Complaints |
|
|
|
|
|
Pending at the beginning of the quarter |
0 |
|
|
|
|
Received during the quarter |
11 |
|
|
|
|
Disposed of during the quarter |
11 |
|
|
|
|
Remaining unresolved at the end of the quarter |
0 |
|
|
STATEMENT OF
STANDALONE ASSETS AND LIABILITIES
Rs. In Millions
|
S.No. |
Particulars |
As At 31 Mar 2013 |
|
A |
EQUITY AND
LIABILITIES |
|
|
1 |
Shareholders' Funds |
|
|
|
Share Capital |
275.000 |
|
|
Reserves and Surplus |
16871.200 |
|
|
|
17146.200 |
|
2 |
Non-Current
Liabilities |
|
|
|
Long Term Borrowings |
9091.200 |
|
|
Deferred Tax Liabilities (Net) |
703.500 |
|
|
Other Long Term Liabilities |
3652.800 |
|
|
Long Term Provisions |
125.800 |
|
|
|
13573.300 |
|
3 |
Current Liabilities |
|
|
|
Short Term Borrowings |
23913.200 |
|
|
Trade Payables |
18116.000 |
|
|
Other Current Liabilities |
11675.200 |
|
|
Short Term Provisions |
88.700 |
|
|
|
53793.100 |
|
|
|
|
|
|
Total Equity and
Liabilities |
84512.600 |
|
B |
ASSETS |
|
|
1 |
Non-Current Assets |
|
|
|
Fixed Assets (Net) |
11620.400 |
|
|
Non-Current Investments |
2191.500 |
|
|
Long Term Loans and Advances |
19448.600 |
|
|
Long Term Trade Receivble |
8124.800 |
|
|
Other Non-Current Assets |
722.300 |
|
|
|
42107.600 |
|
2 |
Current Assets |
|
|
|
Current Investments |
22.100 |
|
|
Inventories |
20019.800 |
|
|
1 Trade Receivables |
14786.600 |
|
|
Cash and Cash Equivalents |
780.100 |
|
|
Short Term Loan and Advances |
3110.000 |
|
|
Other Current Assets |
3686.400 |
|
|
|
42405.000 |
|
|
|
|
|
|
Total Assets |
84512.600 |
Notes:
1. The Financial Results were reviewed by the Audit Committee and taken on record by the Board of Directors of the Company at its meeting held on 30 May 2013.
2. Audited Consolidated financial statement of the Company will be published on receipt of audited results of overseas subsidiaries / Joint Venture.
3. During the year, the Company has recognized revenue to the extent of Rs.410.000 Millions being the award from the arbitral tribunal received for its projects. The same along with the existing amounts of Rs.1090.900 Millions are recognized under trade receivables where the Company has received arbitration awards in its favor. The Company had also recognised revenue of Rs.580.000 Millions in respect of one of the project based on advanced negotiation and discussion with the client and is confident of realising the same, pending the final revision in contract value.
4. The board of directors in its meeting had decided to approach the banks through the corporate debt restructuring (CDR) process for restructuring of the company's debt. The CDR empowered group in its meeting held on 25 March 2013 has admitted the Company's proposal under the CDR which is under consideration.
5. Exceptional item includes provision made by the Company on a prudent basis, considering current economic scenario in Europe, in connection with investments / advances of Rs.952.900 Millions.
Further, the Company has during the year suspended its operations at Oman JV and its branch office and has provided towards all receivables and assets in connection therewith amount to Rs.113.500 Millions. The Company has also suspended recognition of the results of the Joint Venture in its financials and does not expect any liabilities in connection therewith.
6. The Company is engaged mainly in "Construction and Engineering" segment. During the year, the Company has started Real Estate Business which is a different segment of "Real Estate Development" and additionally the company has revenue from Windmills. Revenue from such activities is not significant and accounts for less than 10% of the total revenue and total assets of the Company. Therefore no disclosure of separate segment reporting as required in terms of Accounting Standard AS -17 is done.
7. The figures for the quarter ended 31 March 2013 and 31 March 2012 are the balancing figure between the audited figures in respect of full financial year ended 31 March 2013 and 31 March 2012 respectively and the unaudited published figures up to 31 Dec 2012 and 31 Dec 2011 respectively, being the end of the third quarter of the respective financial year, which were subject to a limited review by the auditors of the Company.
8. Corresponding figures of the previous period have been regrouped / rearranged wherever necessary.
FIXED ASSETS
· Leasehold Land
· Freehold Property
· Plant And Machinery
· Motor Vehicles
· Office Equipments
· Electrical Installation
· Windmills
AS PER WEBSITE
PRESS RELEASE
February 21, 2011
Mumbai
GAMMON BAGS CHENNAI
METRO RAIL CONTRACTS
Gammon – OJSC Mosmetrostroy has been awarded two prestigious contracts of Design and construction of underground stations and associated tunnels for Chennai Metro Rail Limited (CMRL) amounting to Rs.19470.000 Millions.
These contracts are part of the five tender packages(UAA-01 to UAA-05) floated by the CMRL for design and construction of underground stations and associated tunnels covering a total length of 18 km and 19 underground stations.
Out of the above, Gammon India Limited has been awarded package UAA-02 and UAA-03.The two project contracts have a value of Rs 9328.800 Millions and Rs10144.200 Millions.
The scope of work for both packages involve construction of seven underground stations at Government Estate, LIC building, Thousand light, Gemini, Teynampet, Chamiers road and Saidapet along with twin bored tunnels covering a total length of over 6.4 KM (6474 metres).
Gammon will be executing the job along with its JV partner OJSC ‘Mosmetrostroy’, who have the technological knowhow and expertise in underground tunneling. OJSC "Mosmetrostroy" is a versatile multifunctional construction company involved in metro development for the last 80 years in Moscow. Over the time they have constructed 177 stations and laid more than 300km of Railway lines.
Chennai Metropolis has been growing rapidly and the traffic volumes on the roads have also been increasing enormously. Hence the need for a new rail based rapid transport system has been felt. This project aims at providing the people of Chennai with a fast, reliable, convenient, efficient, modern and economical mode of public transport. This in turn will help in its efficient and proper integration with other forms of public and private transport
including buses, sub-urban trains and MRTS. Overall the project will significantly help in the effective traffic management of the metropolis and provide much needed relief and convenience to the commuters in the city and the public at large.
Gammon India today has a strong talent base of over 3,500 employees on its own rolls apart from 10,000 officers and staff working under its aegis at various project sites. It further engages more than 200,000 labour/staff on a daily wage basis. Its stand-alone turnover in the financial year 2009-10 was close to Rs.45000.000 Millions with the Group’s turnover in excess of Rs.68000.000 Millions.
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.58.27 |
|
|
1 |
Rs.91.16 |
|
Euro |
1 |
Rs.77.50 |
INFORMATION DETAILS
|
Report Prepared
by : |
NTH |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
5 |
|
PAID-UP CAPITAL |
1~10 |
4 |
|
OPERATING SCALE |
1~10 |
5 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
4 |
|
--PROFITABILIRY |
1~10 |
3 |
|
--LIQUIDITY |
1~10 |
4 |
|
--LEVERAGE |
1~10 |
4 |
|
--RESERVES |
1~10 |
4 |
|
--CREDIT LINES |
1~10 |
3 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
YES |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
NO |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
DEFAULTER |
|
|
|
--RBI |
YES/NO |
NO |
|
--EPF |
YES/NO |
NO |
|
TOTAL |
|
36 |
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.