MIRA INFORM REPORT
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Report Date : |
13.09.2013 |
IDENTIFICATION DETAILS
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Name : |
ESSAR OIL LIMITED |
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Registered
Office : |
Khambhalia, Post Box No - 24, District Jamnagar - 361 305, Gujarat |
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Country : |
India |
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Financials (as
on) : |
31.03.2013 |
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Date of
Incorporation : |
12.09.1989 |
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Com. Reg. No.: |
04-032116 |
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Capital Investment
/ Paid-up Capital : |
Rs. 13822.700 Millions |
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CIN No.: [Company Identification
No.] |
L11100GJ1989PLC032116 |
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TAN No.: [Tax Deduction &
Collection Account No.] |
RKTE00150D |
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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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Line of Business
: |
Subject is primarily engaged in the business of refining and marketing
of petroleum products in domestic and overseas markets and also engaged in
the business of Exploration and Production. |
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No. of Employees
: |
Information denied by management |
RATING & COMMENTS
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MIRA’s Rating : |
B (36) |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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Maximum Credit Limit : |
USD 87220000 |
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Status : |
Moderate |
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Payment Behaviour : |
Slow |
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Litigation : |
Clear |
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Comments : |
Subject is a part of “Essar Group”. It is a well established company
having a moderate track record. There appears huge loss recorded by the company
during 2013. The external borrowing seems to be huge which act as a threat to
the liquidity position. However, trade relations are reported to be fair. Business is active.
Payments are reported to be slow. The company can be considered for business dealing with great 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
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Country Name |
Previous Rating (31.12.2012) |
Current Rating (31.03.2013) |
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India |
A1 |
A1 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
INDIAN ECONOMIC OVERVIEW
We are living in a
world where volatility and uncertainty have become the New Normal. We saw
a change of government in countries like Tunisia, Egypt, Libya and Vietnam. Once
powerful countries in Europe are now fighting for bankruptcy. We have
taken growth in the developing part of the world for granted but economic
growth in China and India has begun to slow. Companies that were synonymous
with their product categories just a few years ago are now no longer in
existence. Kodak, the inventor of the digital camera had to wind up its
operations, HMV, the British entertainment retailing company and Borders, once
the second largest bookstore have shut down due to their inability to evolve
their business models with the changing time. Readers’ Digest, Thomson Register
are no more !
There is another
megatrend happening. The World order is changing as economic power shifts from
West to East. According to McKinsey study, it took Britain more than 100 years
to double its economic output per person during its industrial revolution and
the US later took more than 50 years to do the same. More than a century later,
China and India have doubled their GDP per capital in 12 and 18 years respectively.
By 2020, emerging Asia will become the world’s largest consuming block,
overtaking North America.
The years after the
outbreak of the global financial crisis, the world economy continues to remain fragile.
The Indian economy demonstrated remarkable resilience in the initial years of
the contagion but finally lost ground last year. GDP growth slowed down.
Currency has been weakening. There is a marked deceleration in agriculture,
industry and services. Dampening sentiment led to a cut-back in investment as
well as private consumption expenditure. Inflation remained at high
levels fuelled by the pressure from the food and fuel sectors. The large fiscal
and current account deficit s continued to cause grave concern. It is
imperative that India regains its growth trajectory of 8-9 % sooner than later.
This is crucially important given the need to create gainful livelihood
opportunities for the millions living in poverty as also the large contingent
of young people joining the job market every year.
EXTERNAL AGENCY RATING
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Rating Agency Name |
FITCH RATING |
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Rating |
Long Term Issuer (FITCH) BBB+ |
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Rating Explanation |
The default risk is currently low. The capacity
for payment of financial commitments is considered adequate. |
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Date |
March 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.
INFORMATION DENIED
Management Non-Co-operative.(Tel No.91-2833-241444).
LOCATIONS
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Registered Office/ Factory 1 : |
Khambhalia Post,
Post Box No. 24, District Jamnagar – 361 305, Gujarat, India. |
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Tel. No.: |
91-2833-241444 |
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Fax No.: |
91-2833-662929 |
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E-Mail : |
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Website : |
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Corporate
Office 1 : |
Essar House, P. O.
Box No. 7945, 11, Keshavrao Khadye Marg, Mahalaxmi, Mumbai – 400 034,
Maharashtra, India |
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Tel. No.: |
91-22-24950606/66601100/ |
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Fax No.: |
91-22-23544281/
23540450 |
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E-Mail : |
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Website: |
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Factory 2 : |
The company’s Oil
fields are located at Mehsana, Gujarat. |
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Corporate
Office 2 : |
Located at:
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Overseas
Office : |
Located at:
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DIRECTORS
As on 31.03.2013
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Name : |
Mr. Prashant Ruia |
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Designation : |
Chairman |
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Name : |
Mr. Naresh K.
Nayyar |
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Designation : |
Deputy Chairman |
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Name : |
Mr. Lalit Kumar
Gupta |
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Designation : |
Managing Director
and Chief Executive Officer |
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Name : |
Mr. Chakrapany
Manoharan |
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Designation : |
Director
(Refinery) |
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Name : |
Mr. Philip S.
Aiken |
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Designation : |
Director |
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Name : |
Mr. Dilip J.
Thakkar |
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Designation : |
Director and
Independent |
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Name : |
Mr. K. N.
Venkatasubramanian |
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Designation : |
Director |
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Name : |
Mr. V.S. Jain |
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Designation : |
Director |
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Name : |
Mr. Rajiv Pal Singh |
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Designation : |
Nominee of State Bank of India |
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Name : |
Mr. Melwyn Rego |
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Designation : |
Nominee of IDBI
Limited |
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Name : |
Mr. Suneet Shukla |
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Designation : |
Nominee of IFCI
Limited |
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Name : |
Mr. R. Sudarsan |
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Designation : |
Nominee of LIC of India |
KEY EXECUTIVES
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Name : |
Mr. Sheikh S
Shaffi |
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Designation : |
Company Secretary
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MAJOR SHAREHOLDERS
As on 30.06.2013
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Category of
Shareholders |
No. of Shares |
Percentage of
Holding |
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(A) Shareholding of Promoter and Promoter Group |
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6215026 |
1.75 |
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6215026 |
1.75 |
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211805915 |
59.64 |
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211805915 |
59.64 |
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Total shareholding of Promoter and Promoter Group (A) |
218020941 |
61.39 |
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(B) Public Shareholding |
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10014006 |
2.82 |
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11270152 |
3.17 |
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32866675 |
9.25 |
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54150833 |
15.25 |
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17003945 |
4.79 |
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59279898 |
16.69 |
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4374610 |
1.23 |
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2314087 |
0.65 |
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2314087 |
0.65 |
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82972540 |
23.36 |
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Total Public shareholding (B) |
137123373 |
38.61 |
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Total (A)+(B) |
355144314 |
100.00 |
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(C) Shares held by Custodians and against which Depository Receipts
have been issued |
0 |
0.00 |
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1010522772 |
0.00 |
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0 |
0.00 |
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1010522772 |
0.00 |
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Total (A)+(B)+(C) |
1365667086 |
0.00 |
%2013-Sep-2013_files/image008.gif){kind=small}
%2013-Sep-2013_files/image009.gif){kind=small}
%2013-Sep-2013_files/image010.gif){kind=small}
BUSINESS DETAILS
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Line of Business : |
Subject is primarily engaged in the business of refining and marketing
of petroleum products in domestic and overseas markets and also engaged in
the business of Exploration and Production. |
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Products : |
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Export To : |
Not Divulged |
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Import From : |
Not Divulged |
GENERAL INFORMATION
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Suppliers : |
Not Divulged |
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Customers : |
Not Divulged |
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No. of Employees : |
Information denied by management |
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Bankers : |
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Facilities : |
Long term
borrowings: The
classification of loans between current liabilities and non-current
liabilities continues based on repayment schedule under respective agreements
as no loans have been recalled due to non-compliance of conditions under any
of the loan agreements. The non compliance of conditions under the loan
agreements are primarily arising out of the order of the Hon’ble Supreme
Court dated January 17, 2012 (refer note 36). This is in accordance with the
guidance issued by the Institute of Chartered Accountants of India on Revised
Schedule VI to the Companies Act, 1956. Security for
term loans and funded interest facilities from banks and financial
institutions and debentures: a)
Term loans and funded interest facilities of Rs.
6996.08 Millions (Previous year Rs. 9,3620.600 Millions) and debentures of
Rs. 1521.800 Millions (Previous year Rs. 1842.100 Millions) are secured / to
be secured by first ranking security interests (pari passu with loans for
refinery expansion, refinery optimisation, refinanced ECB Loan and Sales tax
/ General purpose term loan) on all immovable assets (except certain leased
out assets), all movable assets other than current assets and second ranking
security interests on current assets, present and future, security interest
on rights, title and interests under project documents, trust and retention
accounts, insurance policies all in relation to the refinery including
refinery expansion and refinery optimisation, by pledge of certain shares of
the Company held by promoters, personal guarantees of some of the promoters
and other collaterals being charge on pledge of certain shares of the Group
Company and charge by way of mortgage over a property of Group Company. Term
Lenders have agreed to release personal guarantees and collaterals thereto
and majority of the lenders have already released the same and other are in
process of releasing. A term loan of Rs. 607.800 Millions (Previous year Rs.
1098.200 Millions) {(including funded interest facilities of Rs. 213.700
Millions) (Previous year Rs. 441.200 Millions)} is also secured by a
corporate guarantee and certain assets of a Group Company. b)
Corporate term loan from a bank of Rs. 10000.000 Millions
(Previous year Rs. 5000.00 Millions) is secured by first charge on all
current assets (ranking pari passu with working capital facility) excluding
that of exploration and production division, second charge by way of mortgage
of land and building and plant and machinery and other assets excluding
certain category of assets, personal guarantees of some of the promoters and
corporate guarantee by a Group Company and other collaterals being second
charge on pledge of certain shares of the Company and that of a Group Company
held by promoters and second charge by way of mortgage over a property of
Group Company. c)
Sales tax / General purpose term loan from a bank
of Rs. 31430.000 Millions (Previous year Rs. Nil) is secured / to be secured
by first ranking security interests
(pari passu with loans for refinery, refinery expansion, Refinanced ECB Loan
and refinery optimisation) on all immovable assets (except certain leased out
assets), all movable assets other than current assets and second ranking
security interests on current assets, present and future, personal guarantees
of some of the promoters and certain undertakings provided from holding
companies. d)
Refinanced ECB Loan from bank of Rs. 14669.300
Millions (Previous year Rs. Nil) is secured/to be secured by first ranking
security interests (pari passu with loans for refinery, refinery expansion,
refinery optimisation and Sales tax / General purpose term loan) on all
immovable assets of Refinery Division, all movable assets of refinery
division other than current assets and second ranking security interests on
current assets, present and future, pledge of certain shares of the Company
held by promoters. e)
Term loans of Rs. 39904.300 Millions (Previous
year Rs. 45620.300 Millions) for the Refinery expansion are secured / to be
secured by first ranking security interests (pari passu with loans for
refinery, refinery optimisation, Refinanced ECB and Sales tax / General
purpose term loan) on all immovable assets, all movable assets other than
current assets and second ranking security interests on current assets,
present and future, charge over immovable properties leased to entities
implementing the terminal utility, power utility and township utility
(subject to prior charge in favour of the lenders financing the said
utilities), security interest on rights, title and interests under project
documents, trust and retention accounts, insurance policies in relation to
the refinery, including refinery expansion and further by pledge and non
disposal undertaking of certain shares/global depository shares of the
Company held by promoters / associates of promoters or of the Company,
personal guarantees of promoters of the Company together with collateral
securities and certain undertakings from holding and group companies and
residual charge on the company’s participating interest and cash flows
related to upstream oil and gas, coal bed methane fields and related assets
subject to certain approvals. f)
Term loans of Rs. 10134.500 Millions (Previous
year Rs. Nil) for the refinery optimisation are secured by first ranking
security interests (pari passu with loans for refinery, refinery expansion,
Refinanced ECB Loan and Sales tax / General purpose term loan) on all
immovable assets (except certain leased out assets), all movable assets other
than current assets and second ranking security interests on current assets,
present and future, security interest on rights, title and interests under
project documents, trust and retention accounts, insurance policies in
relation to the refinery, refinery expansion and refinery optimisation and
pledge of shares of the Company. g)
Term loans of Rs. 5340.700 Millions (Previous
year Rs. 3062.100 Millions) is secured by first charge on immovable assets
and movable assets (present and future), first charge over book debts,
operational cash flows, receivables, trust and retention account, Debt
Service Reserve account, participating interest under CBM contract, security
interest on rights, title and interests under the project documents, insurance
policies, clearances, rights under letter of credit, guarantee, performance
bond, corporate guarantee and bank guarantees, all in relation to a CBM
Project. h)
Term loan from a Bank of Rs. 12.000 Millions
(Previous year Rs. 60.000 Millions) is secured by hypothecation of current
assets of an oilfield, bank escrow accounts for certain receivables and
corporate guarantee by a Group Company. (ii) Repayment and other terms: a)
Secured redeemable non – convertible debentures
(“NCDs”) of Rs. 105/- each consists of: 13868,050 (Previous year 16918250) –
12.50% NCDs of Rs. 105/- each amounting to Rs. 1456.100 Millions (Previous
year Rs. 1776.400 Millions). 700000 (Previous year 700000) – 12.50% NCDs, of Rs. 100 each on
private placement basis partly paid up at Rs. 93.86 per debenture amounting
to Rs. 65.700 Millions (Previous year Rs. 65.700 Millions). During the year, the Company refinanced its rupee borrowings with one
of its existing lenders into an
External Commercial Borrowing (ECB). This resulted in conversion of
debentures having face value of Rs. 320.300 Millions also into the ECB loan.
Further, as per the Common Loan Agreement (“the CLA”) entered with lenders
post exit from the Corporate Debt Restructuring (CDR) Scheme, the Company has
agreed to pay interest on a monthly/quarterly basis, on debentures held by
the erstwhile CDR lenders at a floating rate linked to the base rate of the
respective bank prevailing on August 8, 2012, with effect from January 1,
2012, resulting in the interest rates ranging from 12.32% p.a. to 12.75% p.a.
The Company is also in the process of sending offer letters to the remaining
debenture holders (i.e. other than lenders) giving them, inter alia, an
option for prepayment of debentures along with accumulated interest in full. The
principal amount of debentures is otherwise payable from December 2014 to
June 2018 and accumulated interest from December 2014 to March 2027, with an
option to prepay certain portion of interest at a discounted rate. As an
alternative, these debenture holders can opt for revising the terms and
conditions applicable to debentures in line with the terms contained in the
CLA93 The Hon’ble High Court of Gujarat has, in response to the Company’s petition,
ruled vide its orders dated August 04, 2006 and August 11, 2006 that the
interest on certain categories of debentures should be accounted on cash
basis. In accordance with the said petition / order, funded / accrued
interest liabilities amounting to Rs. 4177.200 Millions (Previous year Rs.
4282.400Millions) as at March 31, 2013 have not been accounted for. This
amount carries interest rate ranging from fixed rate of 5% to a floating rate
of 12.75% and is repayable from December 2014 to March 2027. b)
The Interest rates for Common Loan Agreement
(“the CLA”) (earlier Master Restructuring Agreement (“the MRA”)) loans from
Banks and Financial institutions amounting to Rs. 54592.000 Millions
(Previous year Rs. 70700.400 Millions) will based on their prime lending rate
/ base rate LIBOR plus margin (margin ranges from 2.12% to 3.00%) with
different repayment installments starting from December 2009 to March 2026. c)
During the year, the Company exited Corporate
Debt Restructuring Scheme resulting in termination of the MRA dated December
17, 2004 and entered into a CLA dated March 25, 2013 with the lenders for the
loan facilities which were hitherto being governed by the MRA. The MRA gave
an option, subject to consent of lenders, to the Company to prepay certain
funded interest loans (the FS loans) of Rs. 24716.300 Millions on or before
April 24, 2012 without interest. The FS loan has not been prepaid before
April 24, 2012 and is now governed by the CLA. In order to give accounting effect to reflect substance of the
transaction, the FS loan was, since inception, measured by the Company in
accordance with the principles of IAS 39, Financial Instruments, Recognition
and Measurement, in absence of specific guidance in Indian GAAP to cover the
specific situation. In continuance of the above said principle and applying
the principle of Accounting Standard AS 30, Financial Instruments,
Recognition and Measurement, the FS loan has, upon signing of the CLA, been
re-measured since inception, considering present value of cash flows
inclusive of interest. Accordingly, the gross liability of Rs. 31638.400
Millions of the FS loans and funded interest thereon as at March 31, 2013
(comprising of Rs. 21263.600 Millions to the banks and Rs. 1,037.48 Millions
to the financial institutions) have been measured at Rs. 18338.400 Millions
(comprising of Rs. 12343.400 Millions to the banks and Rs. 5995.000 Millions
to the financial institutions). Consequently, borrowing cost of Rs. 5367.100
Millions attributable to construction of the Refinery Project based on such
re-measurement has been capitalised as part of cost of Fixed Assets and
balance borrowing cost of Rs. 1109.400 has been recognised in the statement
of profit and loss. The FS Loans of Rs. 24716.300 Millions is repayable in various
installments from March 2021 to March 2026 and the Funded Interest thereon as
at March 31, 2013 amounting to Rs. 6921.900 Millions is repayable in 40 equal
quarterly installments beginning June 30, 2015. A funded interest loan of Rs.
2068.800 Millions (Previous year Rs. 2068.800 Millions) is payable in a
single bullet payment in 2031 and is continued to be measured in accordance
with the aforementioned principles at Rs. 349.500 Millions (Previous year Rs.
316.700 Millions). d)
Terms Loans amounting to Rs. 45639.700 Millions
(Previous year Rs. 40719.000 Millions) carry interest rate linked with
respective banks’ prime lending rate / base rate / LIBOR plus margin /
liquidity premium and are repayable in installments starting from December
2012 ending in March 2020. Out of above Rs. 9484.500 Millions (Previous year
Rs. 17076.100 Millions) pertains to Buyers’ Credit which will be ultimately
converted into Term Loan. e)
Term loans amounting to Rs. 5340.700 Millions
(Previous year Rs. 3062.100 Millions) carry interest rate linked with
respective banks prime lending rate/ base rate/LIBOR plus margin and are
repayable in installments starting from March 2014 and ending in June 2021.
Out of above Rs. 676.200Millions (Previous year Rs. 324.700 Millions)
pertains to Buyers’ credit which will be ultimately converted into term loan. f)
Term loans amounting to Rs. 12.000 Millions
(Previous year Rs. 60.000 Millions) carry 12.80% interest rate with
repayments ending in April 2013. g)
ECB Loan amounting to Rs. 4399.000 Millions (Previous
year Rs. 4901.300 Millions) carry interest rate of LIBOR + 2.75% are
repayable in installments ending in October 2018. h)
ECB Loan
amounting to Rs. 14669.300 Millions (Previous year Rs. Nil) carry interest
rate of 6 months LIBOR + 5.00% are repayable in installments starting from
March 2015 ending in March 2023. i)
Corporate term loan amounting to Rs. 10000.000
Millions (Previous year Rs. 5000.00 Millions) carry interest rate at banks’
prime lending rate / base rate plus 3.75% (margin / liquidity premium) and is
repayable in installments from June 2014 to March 2017. j)
General purpose term loan amounting to Rs.
31430.000 Millions (Previous year Rs. Nil) carry interest rate at banks’
prime lending rate / base rate plus 3.00% (margin / liquidity premium) and is
repayable in installments from December 2012 to September 2018. k)
The pilot project for coal bed methane gas was
partially financed by a conditional grant of USD 0.89 million (Previous year USD
0.89 million) and Rs. 23.100 Millions (Previous year Rs. 23.100 Millions)
received from a bank. The conditional grant, in terms of the agreement, will
be repayable in the event the Company puts the project to commercial use, and
repayments to the bank will be based on gross annual sales derived from the
commercial exploitation of the project, subject to a maximum repayment of
200% of the conditional grant. Commercial exploitation of the project is
dependent upon getting necessary approvals from the Government of India. l)
Unsecured loans from related parties includes Rs.
Nil (Previous year Rs. 11090.000 Millions) carrying interest rate 9.5% and
Rupee loan amounting to Rs. 457.500 Millions (Previous year Rs. 702.000
Millions) carrying interest rate 10.25% repayable by April 25, 2014 in
various installments. Security for short term borrowing:
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Banking
Relations : |
-- |
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Auditors : |
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Name : |
Deloitte Haskins
and Sells Chartered Accountants |
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Address : |
Ahmadabad, Gujarat, India |
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Holding
Companies: |
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Subsidiaries: |
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Associate: |
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Fellow Subsidiaries |
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Companies in which promoters have significant
influence/control : |
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CAPITAL STRUCTURE
As on 31.03.2013
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
5000000000 |
Equity Shares |
Rs. 10/- each |
Rs. 50000.000 Millions |
Issued, Subscribed Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
1427593086 |
Equity Shares |
Rs. 10/- each |
Rs. 14275.900 Millions |
Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
1365667086 |
Equity Shares |
Rs. 10/- each |
Rs. 13656.700 Millions |
|
61926000 |
Add : Forfeited shares - Equity shares of Rs.10/- each |
|
Rs. 166.000 Millions |
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Total |
|
Rs. 13822.700 Millions |
a)
Reconciliation of
the number of shares outstanding at the beginning and at the end of the
reporting period
|
Equity Shares |
No.
of Shares |
Rs.
In Millions |
|
Shares outstanding at the beginning of the year |
1365667086 |
13656.700 |
|
Add : Equity Shares issued during the year |
- |
- |
|
Shares outstanding at the end of the year |
1365667086 |
13656.700 |
b)
Terms / rights
attached to the equity Shares / Global depository shares (GDS)
The company has only
one class of equity shares having a par value of Rs. 10 per share. Each holder
of equity share is entitled to one vote per share.
In the event of
liquidation of the company, the holders of equity shares will be entitled to
receive remaining assets of the company, after distribution of all preferential
amounts. The distribution will be in proportion to the number of equity shares
held by the shareholders.
Holders of GDS
will be entitled to receive dividends, subject to the terms of the Deposit
Agreement, to the same extent as the holders of shares, less the fees and
expenses payable under such Deposit Agreement and any Indian tax applicable to
such dividends. Holders of GDS will not have voting rights with respect to the
Deposited Shares.
c)
Shares held by
holding / ultimate holding company and / or their subsidiaries / associates
|
Particulars |
No.
of Shares |
Rs.
In Millions |
|
4,761,000 GDS
(Previous year 4,761,000 GDS) held by Essar Oil and Gas Limited (formerly known
as Vadinar Oil), Mauritius, the holding Company pursuant to section 4(6) of
the Companies Act, 1956 |
728433000 |
7284.300 |
|
1,843,724 GDS
(Previous year 1,843,724 GDS) held by Essar Energy Holdings Limited., Mauritius,
subsidiary of the holding company |
282089772 |
2820.900 |
|
Equity shares
held by Essar Energy Holdings Limited., Mauritius, subsidiary of the holding
company |
178858624 |
1788.600 |
|
Equity Shares held
by Essar Power Hazira Holdings Limited (name changed from Hazira Steel 2),
subsidiary of ultimate holding company, Essar Global Fund Limited |
100 |
0.000* |
* Amount less than Rs. 0.100 Million
d)
Stock Options
On December 2,
2011, the Company approved grant of 3211391 options (convertible at the option
of the eligible employees into equivalent number of equity shares of Rs. 10/-
each of the Company, in three equal installments i.e. at the end of 3rd / 4th /
5th year from the grant date) to the eligible employees and Executive Directors
of the Company pursuant to Essar Oil Employee Stock Option Scheme 2011 approved
by the members at the 21st Annual General Meeting held on August 12, 2011. The
exercise period for the options is 7 years from the date of vesting.
These stock
options have been granted at an option value of Rs. 69.05 per equity share of
face value of Rs. 10/- each (i.e. the closing price of the equity shares of the
Company on December 01, 2011 at the National Stock Exchange of India Limited,
being the exchange having the higher quantity of trading of Company’s shares).
2,519,058 options
(Previous year 2,910,749) were outstanding as on March 31, 2013. The
Remuneration Committee of the Board of Directors has noted the forfeiture of
391,691 stock options on May 10, 2013.
e)
Details of
shareholders (including GDS holders) holding more than 5% shares in the Company
|
Particulars |
No.
of Shares |
%
of Shares |
|
4,761,000 held by Essar Oil and Gas Limited (formerly known as Vadinar
Oil) Mauritius, the holding Company pursuant to section 4(6) of the Companies
Act, 1956 |
728433000 |
53.34 |
|
1,843,724 GDSs held by Essar Energy Holdings Limited., Mauritius,
subsidiary of the holding company. |
282089772 |
20.66 |
|
Equity shares held by Essar Energy Holdings Limited., Mauritius,
subsidiary of the Holding Company. |
178858624 |
13.10 |
LISTING DETAILS:
|
Subject Stock
Code : |
BSE : 500134 NSE : ESSAROIL |
|
Stock Exchange Place : |
|
|
Listing Date : |
02.08.1995 |
FINANCIAL DATA
[all figures are in
Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2013 |
31.03.2012 |
31.03.2011 |
|
I.
EQUITY AND LIABILITIES |
|
|
|
|
(1)Shareholders'
Funds |
|
|
|
|
(a) Share Capital |
13822.700 |
13822.700 |
13822.700 |
|
(b) Reserves & Surplus |
(2754.400) |
7984.700 |
21494.600 |
|
(c) Money received against share warrants |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
(2) Share
Application money pending allotment |
0.000 |
0.000 |
0.000 |
|
Total
Shareholders’ Funds (1) + (2) |
11068.300 |
21807.400 |
35317.300 |
|
|
|
|
|
|
Foreign
Currency Compulsory Convertible Bonds |
13400.000 |
13400.000 |
0.000 |
|
|
|
|
|
|
(3) Non-Current Liabilities |
|
|
|
|
(a) long-term borrowings |
145387.300 |
122028.000 |
116183.300 |
|
(b) Deferred tax liabilities (Net) |
0.000 |
0.000 |
0.000 |
|
(c)
Other long term liabilities |
22160.700 |
47955.500 |
64269.900 |
|
(d)
long-term provisions |
51.400 |
10.000 |
10.000 |
|
Total
Non-current Liabilities (3) |
167599.400 |
169993.500 |
180463.200 |
|
|
|
|
|
|
(4)
Current Liabilities |
|
|
|
|
(a)
Short term borrowings |
78402.100 |
38183.700 |
23312.500 |
|
(b)
Trade payables |
113561.000 |
108100.400 |
64948.500 |
|
(c)
Other current liabilities |
91227.100 |
49124.900 |
33556.400 |
|
(d)
Short-term provisions |
400.600 |
306.300 |
295.800 |
|
Total
Current Liabilities (4) |
283590.800 |
195715.300 |
122113.200 |
|
|
|
|
|
|
TOTAL |
475658.500 |
400916.200 |
337893.700 |
|
|
|
|
|
|
II.
ASSETS |
|
|
|
|
(1)
Non-current assets |
|
|
|
|
(a)
Fixed Assets |
|
|
|
|
(i)
Tangible assets |
212561.300 |
212999.000 |
117299.600 |
|
(ii)
Intangible Assets |
180.200 |
200.200 |
141.300 |
|
(iii)
Capital work-in-progress |
26103.800 |
17604.700 |
81766.700 |
|
(iv) Intangible assets under development |
0.000 |
0.000 |
0.000 |
|
(b) Non-current
Investments |
1030.000 |
1030.000 |
1030.000 |
|
(c) Deferred tax assets
(net) |
0.000 |
0.000 |
0.000 |
|
(d) Long-term Loan
and Advances |
11381.400 |
4109.300 |
4860.100 |
|
(e)
Other Non-current assets |
13345.300 |
18096.400 |
17033.800 |
|
Total
Non-Current Assets |
264602.000 |
254039.600 |
222131.500 |
|
|
|
|
|
|
(2)
Current assets |
|
|
|
|
(a)
Current investments |
0.000 |
0.000 |
0.000 |
|
(b)
Inventories |
105883.700 |
76816.700 |
57491.400 |
|
(c)
Trade receivables |
47164.900 |
39969.300 |
24236.400 |
|
(d)
Cash and cash equivalents |
24306.600 |
20609.400 |
29379.900 |
|
(e)
Short-term loans and advances |
12762.900 |
2280.200 |
3211.700 |
|
(f)
Other current assets |
20938.400 |
7201.000 |
1442.800 |
|
Total
Current Assets |
211056.500 |
146876.600 |
115762.200 |
|
|
|
|
|
|
TOTAL |
475658.500 |
400916.200 |
337893.700 |
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2013 |
31.03.2012 |
31.03.2011 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
885781.200 |
583366.300 |
470609.200 |
|
|
|
Other Income |
6087.800 |
4247.600 |
2812.900 |
|
|
|
TOTAL |
891869.000 |
587613.900 |
473422.100 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of Materials Consumed |
813339.800 |
528948.500 |
421292.700 |
|
|
|
Purchases of traded goods |
8667.200 |
19571.600 |
19642.000 |
|
|
|
Changes in inventory of finished goods and work-in-progress |
(2368.800) |
-9881.000 |
(11576.400) |
|
|
|
Employee Benefits Expenses |
1856.600 |
1345.600 |
1196.700 |
|
|
|
Other expenses |
33867.400 |
26621.600 |
15072.200 |
|
|
|
TOTAL |
855362.200 |
566606.300 |
445627.200 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION |
36506.800 |
21007.600 |
27794.900 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES |
34235.800 |
13868.400 |
12202.400 |
|
|
|
|
|
|
|
|
|
|
PROFIT/(LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION |
2271.000 |
7139.200 |
15592.500 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION |
12960.600 |
7619.400 |
7308.600 |
|
|
|
|
|
|
|
|
|
|
PROFIT/(LOSS)
BEFORE EXCEPTIONAL ITEMS AND TAX |
(10689.600) |
(480.200) |
8283.900 |
|
|
|
|
|
|
|
|
|
Less |
EXCEPTIONAL
ITEMS |
1114.800 |
12374.600 |
10834.300 |
|
|
|
|
|
|
|
|
|
|
PROFIT/(LOSS) BEFORE TAX |
(11804.400) |
(12854.800) |
(2550.400) |
|
|
|
|
|
|
|
|
|
Less |
TAX |
0.000 |
0.000 |
(33.500) |
|
|
|
|
|
|
|
|
|
|
PROFIT/(LOSS) AFTER TAX |
(11804.400) |
(12854.800) |
(2516.900) |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
(41648.200) |
(28793.400) |
(26276.500) |
|
|
|
|
|
|
|
|
|
|
BALANCE CARRIED
TO THE B/S |
(53452.600) |
(41648.200) |
(28793.400) |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Interest |
6.800 |
0.000 |
0.400 |
|
|
|
FOB value of exports |
306402.900 |
199153.300 |
150060.200 |
|
|
|
Overseas trading of crude / Petroleum
products |
0.000 |
12555.100 |
5513.400 |
|
|
|
On commodity hedging |
12520.100 |
3435.100 |
1829.400 |
|
|
|
Income from technical services |
222.900 |
147.300 |
117.800 |
|
|
|
Income from sale of participating interest
in an E&P block |
0.000 |
0.000 |
51.300 |
|
|
|
Others |
65.300 |
72.00 |
0.900 |
|
|
TOTAL EARNINGS |
319218.000 |
215362.800 |
157573.400 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
681393.600 |
473612.200 |
374753.900 |
|
|
|
Stores & Spares |
4591.900 |
1128.100 |
1508.100 |
|
|
|
Capital Goods |
1123.200 |
6624.600 |
19509.200 |
|
|
TOTAL IMPORTS |
687108.700 |
481364.900 |
395771.200 |
|
|
|
|
|
|
|
|
|
|
Earnings/(Loss) Per
Share (Rs.) |
|
|
|
|
|
|
Basic |
(8.64) |
(9.41) |
(1.87) |
|
|
|
Diluted |
(8.64) |
(9.41) |
(1.91) |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2013 1st
Quarter |
|
Net Sales |
224610.000 |
|
Total Expenditure |
222770.000 |
|
PBIDT (Excl OI) |
1840.000 |
|
Other Income |
2310.000 |
|
Operating Profit |
4150.000 |
|
Interest |
9460.000 |
|
Exceptional Items |
0.000 |
|
PBDT |
(5310.000) |
|
Depreciation |
3320.000 |
|
Profit Before Tax |
(8630.000) |
|
Tax |
0.000 |
|
Provisions and contingencies |
0.000 |
|
Profit After Tax |
(8630.000) |
|
Extraordinary Items |
0.000 |
|
Prior Period Expenses |
0.000 |
|
Other Adjustments |
0.000 |
|
Net Profit |
(8630.000) |
KEY RATIOS
|
PARTICULARS |
|
31.03.2013 |
31.03.2012 |
31.03.2011 |
|
PAT / Total Income |
(%) |
(1.32)
|
(2.19)
|
(0.53) |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
(1.33)
|
(2.20)
|
(0.54) |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
(5.01)
|
(7.60)
|
(1.85) |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
(1.06)
|
(0.59)
|
(0.07) |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Debt /Networth) |
|
20.22
|
7.35
|
3.95 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
0.74
|
0.45
|
0.95 |
LOCAL AGENCY FURTHER INFORMATION
|
Sr. No. |
Check List by Info Agents |
Available in Report (Yes
/ No) |
|
1] |
Year of Establishment |
Yes |
|
2] |
Locality of the firm |
Yes |
|
3] |
Constitutions of the firm |
Yes |
|
4] |
Premises details |
No |
|
5] |
Type of Business |
Yes |
|
6] |
Line of Business |
Yes |
|
7] |
Promoter's background |
No |
|
8] |
No. of employees |
Yes |
|
9] |
Name of person contacted |
No |
|
10] |
Designation of contact person |
No |
|
11] |
Turnover of firm for last three years |
Yes |
|
12] |
Profitability for last three years |
Yes |
|
13] |
Reasons for variation <> 20% |
----------- |
|
14] |
Estimation for coming financial year |
No |
|
15] |
Capital in the business |
Yes |
|
16] |
Details of sister concerns |
Yes |
|
17] |
Major suppliers |
No |
|
18] |
Major customers |
No |
|
19] |
Payments terms |
No |
|
20] |
Export / Import details (if applicable) |
No |
|
21] |
Market information |
---------- |
|
22] |
Litigations that the firm / promoter
involved in |
---------- |
|
23] |
Banking Details |
Yes |
|
24] |
Banking facility details |
Yes |
|
25] |
Conduct of the banking account |
---------- |
|
26] |
Buyer visit details |
---------- |
|
27] |
Financials, if provided |
Yes |
|
28] |
Incorporation details, if applicable |
Yes |
|
29] |
Last accounts filed at ROC |
Yes |
|
30] |
Major Shareholders, if available |
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 |
UNSECURED LOANS:
|
Particulars |
31.03.2012 Rs. In Millions |
31.03.2011 Rs. In Millions |
|
Long Term
Borrowings |
|
|
|
Finance lease obligation |
|
|
|
From related parties |
446.900 |
451.100 |
|
From others |
11.900 |
12.300 |
|
Other loans |
|
|
|
Conditional grant from a bank |
71.400 |
68.500 |
|
From related parties |
131.700 |
11512.800 |
|
Total |
661.900 |
12044.700 |
INDEX OF CHARGE:
|
Sr .No |
Charge ID |
Date of Charge Creation/Modification |
Charge amount secured |
Charge Holder |
Address |
Service Request Number (SRN) |
|
1 |
10433008 |
10/06/2013 |
5,400,000,000.00
|
IDBI TRUSTEESHIP
SERVICES LIMITED |
Asian Building, Ground Floor, 17, R.Kamani
Marg, Ballard Estate, MUMBAI, Maharashtra - 400001, INDIA |
B77947000 |
|
2 |
10423132 |
01/04/2013 * |
50,000,000,000.00
|
IDBI TRUSTEESHIP
SERVICES LIMITED |
Asian Bldg., Ground Floor, 17, R.Kamani
Marg, Ballard Estate,, MUMBAI, Maharashtra - 400001, INDIA |
B74604042 |
|
3 |
10420270 |
26/03/2013 |
14,893,725,000.00
|
IDBI Bank
Limited |
IDBI TOWERWTC COMPLEX, CUFFE PARADE, MUMBAI,
Maharashtra - 400005, INDIA |
B73342115 |
|
4 |
10419333 |
20/03/2013 |
5,000,000,000.00
|
YES BANK LIMITED
|
9TH FLOOR, NEHRU CENTRE, DISCOVERY OF
INDIA, DR. ANNIE BESANT ROAD, WORLI, MUMBAI, Maharashtra - 400018, INDIA |
B73062960 |
|
5 |
10402887 |
31/01/2013 |
2,000,000,000.00
|
Central Bank of
India |
1st Floor, MMO Building, Fort, Mumbai,
Mumbai, Ma |
B68038629 |
|
6 |
10393843 |
06/12/2012 |
1,550,000,000.00
|
IDBI Bank
Limited |
IDBI TOWER WTC COMPLEX, CUFFE PARADE,
MUMBAI, Maharashtra - 400005, INDIA |
B64825672 |
|
7 |
10374025 |
21/03/2013 * |
5,733,300,000.00
|
IDBI TRUSTEESHIP
SERVICES LIMITED |
Asian Building, Ground Floor, 17, R.Kamani
Marg, Ballard Estate, MUMBAI, Maharashtra - 400001, INDIA |
B73119083 |
|
8 |
10372403 |
31/07/2012 |
11,330,000,000.00
|
IDBI TRUSTEESHIP
SERVICES LIMITED |
Asian Building, Ground Floor, 17, R.Kamani
Marg, Ballard Estate, MUMBAI, Maharashtra - 400001, INDIA |
B56340177 |
|
9 |
10273767 |
30/07/2012 * |
10,000,000,000.00
|
IDBI TRUSTEESHIP
SERVICES LIMITED |
Asian Building, Ground Floor, 17, R.Kamani
Marg, Ballard Estate, MUMBAI, Maharashtra - 400001, INDIA |
B44704351 |
|
10 |
10267235 |
20/01/2011 |
5,000,000,000.00
|
ICICI BANK
LIMITED |
LANDMARKRACE COURCE CIRCLE, ALKAPURI,
BARODA, Gujarat - 390015, INDIA |
B05111711 |
* Date of charge modification
CORPORATE
INFORMATION:
The Company is a
public limited company domiciled in India and incorporated under the provisions
of the Companies Act, 1956. It is primarily engaged in the business of refining
and marketing of petroleum products in domestic and overseas markets. It is
also engaged in the business of Exploration and Production.
MANAGEMENT
DISCUSSION AND ANALYSIS
Global Economic and Market Overview
The global economy
is expected to improve gradually with improvement in US economic environment,
moderate growth of other emerging market economies like India, China and Brazil
and revival in Euro zone and Japan. As per the International Monetary Fund’s
(IMF) ‘World Economic Outlook’ published in April 2013, global economic growth
is progressing to 3.3% in 2013 compared to 3% in 2012. However, the stability
and growth prospectus of US economy resulted in flow of money from emerging
markets to US and other developed markets which led to sharp depreciation of
emerging market’s currencies against USD particularly India which largely
depends on import of crude. This has made managing current account deficit a
challenge for policy makers.
The global
economic environment and delay in implementation of key policy decisions by the
Government of India (Government) moderated Indian economic growth to 5% during
FY 2012-13 from 6.2% in the previous year. While India continues to be one of
the fastest growing major economies in the world, in order to sustain a healthy
growth rate in the future, the Government needs to quickly address key
infrastructural bottlenecks, huge current account deficit and uncertainty with
regard to policy and regulatory matters. The economy growth is expected to be
back on track in coming year on account of new reforms announced and measures
undertaken by the Government to contain current account deficit, high inflation
and bring about overall improvement in fiscal consolidation.
Oil and natural
gas will remain key sources of fuel in the global energy basket in the
foreseeable future in spite of global thrust on increasing the share of renewal
energy. There will be gradual increase of green / renewal energy and bio-fuels
in overall basket of energy mix. However, this is not expected to significantly
impact the oil demand. As per International Energy Agency (IEA), oil &
natural gas is expected to be around 53% of total energy consumption by year
2030. Hence, the global strategic focus on hydrocarbon fuels will be a key
issue for policy makers across the world.
World oil demand
is expected to grow at around 1 million barrel of oil equivalent per year
between 2013 and 2017 with Asia accounting for 55% of the incremental demand
growth. The focus of global energy
demand growth has decisively shifted from developed markets to Asian region.
Global markets continue to witness closures of refining capacities due to high
operating cost, declining growth due to tough economic environment, high
maintenance cost to maintain high quality products (Euro V), inability to
process heavy and ultra heavy crudes due to environmental restrictions etc. In
the last 4 years an average o\f more than 1 mmbbl of refining capacities have
been shut down each year. New refinery capacities are being added in Asia and
Middle East where demand is expected to grow at a healthy rate; the refineries
in this region also have structural cost competitiveness compared to their west
counterparts. On net basis, refinery capacity additions in next 2-3 years are
expected to be more or less equal to incremental demand which is expected to
support the refinery margins.
OPERATIONAL PERFORMANCE
The Refinery
registered an impressive 46% growth in crude processing at 19.77 million metric
tones (MMT) compared to 13.50 MMT during the previous financial year. All the
new units completed under Train I expansion project were fully stabilized
within two to three months of commissioning and the Optimisation project which
took our refining capacity from 18 million metric tones per annum (MMTPA) to 20
MMTPA was also completed four months ahead of schedule in June 2012. The
Refinery has operated successfully at the enhanced capacity of 20 MMTPA from
July 2012 onwards. Detailed information on the operational performance for the
financial year is given in the Management Discussion and Analysis which is
annexed to the Directors’ Report.
FINANCIAL PERFORMANCE
During the year,
with increase in refining capacity, the Company recorded a strong revenue
growth of 53% at ` 970680.000 Millions up from Rs. 634280.000 Millions in the
previous financial year. The Current Price Gross Refining Margin (CPGRM) for
the refinery business also registered a quantum jump at USD7.96 per barrel
compared to USD4.23 per barrel for the previous financial year. The Earning
before Interest, Depreciation, Tax and Amortization (EBIDTA) for the current
financial year increased by 74% to Rs. 36510.000 Millions From ` 21010.000
Millions for previous financial year. This is mainly on account of increase in
the sales volume arising due to expansion of Refining capacity from 10.5 MMTPA
to 20 MMTPA, higher gross refining margins, increase in other operating income
which is partially offset by MTM provision on commodity hedging. Further in the
previous year, even though the income arising out of defeasement of sales tax
incentive amounting to Rs. 778.25 was part of EBITDA, this was reversed and
shown as exceptional item. For the financial year ended March 31, 2013, the
loss after tax decreased marginally due to higher EBITDA as explained above
offset by increase in interest and depreciation expenses post completion of
Refinery expansion, which was treated as part of expenditure during
construction in the previous year. Exceptional items for the previous year
mainly represents reversal of sales tax incentive income post litigation of
this matter and provision for impact towards exit from Corporate Debt
Restructuring mechanism (CDR exit) whereas in the current year it only
represents the additional impact on CDR exit. The Company reported net loss
after tax (after exceptional items) for current financial year at Rs. 11800.000
Millions as against previous year figure of Rs. 12850.000 Millions. In the
absence of profits during the financial year, the Board has not recommended any
dividend for the year.
The Sales tax
matter has been resolved and concluded with the final judgment of Supreme Court
on September 13, 2012. The Company is required to pay balance sales tax
liability in two years with 10% interest. The Company has successfully tied up
for term loan facility with a Bank to mitigate the liquidity risk of payment of
sales tax liability.
The Company’s exit
from CDR mechanism is another crucial landmark achieved by the Company towards
the end of the financial year.
FIXED ASSETS:
- Land
- Building
- Plant and machinery
- Producing properties
- Furniture and fixtures
- Office equipment
- Vehicles
- Aircraft
- Software and licenses
PRESS RELEASE
ONGC,
ESSAR OIL SHORTLISTED TO BID FOR IRAQ'S NASSIRIYA FIELD
September
03, 2013
Two firms were among 5 companies that Iraq added to previously
shortlisted 7 global energy giants for the development of the Nassiriya oil
field
State-owned
Oil and Natural Gas Corp (ONGC) and Essar Oil have been shortlisted to bid for
development of Iraq's $4.4 billion Nassiriya oil field and the construction of
a new 300,000 barrels per day refinery.
The
two firms were among five companies that Iraq added to previously shortlisted 7
global energy giants for the development of the Nassiriya oil field and the
construction of a dedicated export refinery as one package.
Besides ONGC and Essar, the new bidders added are Russia's Rosneft, Maurel and
Prom of France, and South Korea's GS Engineering and Construction, according to
Iraq's Oil Ministry.
Iraq
had in March shortlised seven firms including Reliance Industries to bid for
the project. Others shortlisted then included French energy giant Total,
Russia's Lukoil, CNPC of China and American firm Brown Energy.
Russia's
Zarubezhneft and JGC and Tonen General of Japan were the other two shortlisted
in March from 14 companies that expressed interest in taking up the
multi-billion dollar project.
All
the 12 qualified firms will now be invited to review data packages and discuss
contract terms. Iraq intends to award the project by year end.
The
OPEC nation has three main refineries - Baiji, Daura and Basra -- with a total
capacity of around 567,000 barrels per day (bpd). It wants to increase the
refining capacity to 750,000 bpd through improvements in existing plants.
It also plans four new refineries in Karbala, Kirkuk, Missan and in Nassiriya.
"The
Al-Nasiriya Integrated Project contemplates the development of the 4-plus
billion barrel Nasiriya oil field in Thi-Qar province together with the
construction and operation of a new 300,000 bpd refinery," Iraq's
Petroleum Contracts and Licensing Directorate (PCLD), part of the Ministry of
Oil, said.
The
international engineering and construction firm Foster Wheeler recently
completed a Front End Engineering and Design (FEED) study for the refinery.
The
Nasiriya project marks re-entry of RIL into Iraq.
The
company's Dubai-based arm Reliance Exploration and Production DMCC had in 2007
taken a 100 per cent stake in the Rovi and Sarta blocks in Kurdistan.
Baghdad
termed the award of exploration contract to RIL and other firms by the
autonomous Kurdistan region as illegal and threatened to blacklist any firm
that dealt with the Kurds.
A
year after the blacklisting threat, RIL did not apply for being shortlisted for
development of oil fields in Iraq.
Thereafter,
it did not figure in the list of companies applying to bid for successive
licensing rounds of Iraq.
RIL
finally got rid of the Kurd blocks in July last year when it sold its stake to
Chevron Corp for an undisclosed sum.
ESSAR OIL IN RED ON RUPEE
VOLATILITY
August 15, 2013
Board appoints Prashant Ruia as Non-Executive Chairman
Negative forex fluctuations arising out of 10% rupee depreciation during the first quarter of this fiscal has lead to Essar Oil reporting a net loss of Rs 8630.000 Millions.
Net loss has however, narrowed 43% as compared to the first quarter last fiscal when Essar Oil reported a net loss of Rs 15180.000 Millions. The company had reported net profit of Rs 2000.000 Millions during the fourth quarter of last fiscal.
“The quarter was marked by rupee volatility, which has impacted our profitability due to mark-to-market provisions. Due to prudent risk management policy followed by us, there are no cash losses," said Suresh Jain, CFO, Essar Oil.
A press statement from the company said it follows a very prudent risk management policy to hedge all its risks against currency fluctuations. As a result, the forex variations are mostly of mark-to-market nature, which is recoverable through sales or gross refining margin (GRM) in next quarters and hence have cash and earning neutral impact during the full financial year.
Essar Oil posted a 12% increase in revenue at Rs 247210.000 Millions against Rs 221090.000 Millions during in the correspoding previous quarter. The company's GRM for the quarter stood at $7 per barrel against $4.69 per barrel during April-June quarter of 2012.
For the quarter, the refinery processed 5.14 metric million tonnes (MMT) of crude, up 15% against the corresponding last quarter. The refinery continues to function at over its nameplate capacity of 20 MMTPA for the last four consecutive quarters with all units stabilized. During the quarter, the refinery operated at 103% of its capacity. Share of ultra heavy crude in refinery’s crude diet rose to 56% in the reporting quarter from 48% in the same period last year.
“The refinery has demonstrated excellent operating performance with a very strong focus on safety and has consistently outperformed the targeted benchmark IEA margins. Going forward, we are looking to further strengthen our retail business as the deregulation of diesel is eventually in sight based on regular increase in the retail prices," said LK Gupta, Managing Director and CEO, Essar Oil.
"We continue on our path to dollarize our debt and have converted rupee term loans into equivalent foreign currency debt of $340 million through ECBs /Swaps, taking our total dollarized debt to $821 million, in line with RBI approval. Besides providing interest saving, this also enhances our liquidity position,” Jain added.
ESSAR OIL SHOWS INTEREST IN SETTING UP PROJECT IN BENGAL
has shown interest in setting up its third coal-bed methane (CBM) project in the Asansol-Ranigunj belt in West Bengal, state's industry minister Partha Chatterjee said today. The company would invest Rs 5,2000.000 Millions for the project, Chatterjee told reporters here.
He asked company representatives who met him to furnish a proposal and submit it to the government. Chatterjee said Saroj Poddar of Texmaco had also called on him during the day for a food processing unit at Sankrail in Howrah. He said cement major ACC was ready with its plant in the state and it was expected to be inaugurated during the month.
SUPREME COURT DECIDES ON ESSAR OIL GUJARAT SALES TAX MATTER
Honourable Supreme Court passed a judgement in the Gujarat Sales Tax case, directing Essar Oil to pay the balance sales tax dues in installments over two years. The balance dues of Rs 51650.000 Millions are now payable in eight quarterly installments beginning January 2, 2013.
CMT REPORT (Corruption, Money Laundering
& Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts, India Prisons Service,
Interpol, etc.
1] INFORMATION ON
DESIGNATED PARTY
No exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or investigation
registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs. 63.67 |
|
UK Pound |
1 |
Rs. 100.71 |
|
Euro |
1 |
Rs. 84.72 |
INFORMATION DETAILS
|
Report Prepared
by : |
VNT |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
4 |
|
PAID-UP CAPITAL |
1~10 |
4 |
|
OPERATING SCALE |
1~10 |
4 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
4 |
|
--PROFITABILIRY |
1~10 |
4 |
|
--LIQUIDITY |
1~10 |
4 |
|
--LEVERAGE |
1~10 |
4 |
|
--RESERVES |
1~10 |
4 |
|
--CREDIT LINES |
1~10 |
4 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
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.