MIRA INFORM REPORT
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Report Date : |
07.04.2014 |
IDENTIFICATION DETAILS
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Name : |
BHARAT FORGE LIMITED |
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Registered
Office : |
Mundhwa, Pune Cantonment, Pune – 411036, |
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Country : |
India |
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Financials (as
on) : |
31.03.2013 |
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Date of
Incorporation : |
19.06.1961 |
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Com. Reg. No.: |
11-012046 |
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Capital
Investment / Paid-up Capital : |
Rs.465.680 Millions |
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CIN No.: [Company Identification
No.] |
L25209PN1961PLC012046 |
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TAN No.: [Tax Deduction &
Collection Account No.] |
PNEB0272E |
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Legal Form : |
A Public Limited Liability company. The company’s Share are Listed on
the Stock Exchange. |
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Line of Business
: |
The Company is
engaged in the manufacturing and selling of forged components. |
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No. of Employees
: |
Not Divulged |
RATING & COMMENTS
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MIRA’s Rating : |
A (66) |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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 |
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Maximum Credit Limit : |
USD 92440000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a well-established and a reputed company having fine track
record. Financial position of the company is sound. Directors are reported to
be experienced and respectable businessmen. Trade relations are reported as
fair. Business is active. Payments are reported to be regular and as per
commitments. The company can be considered normal for business dealings at usual
trade terms and conditions. |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – December 1, 2013
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Country Name |
Previous Rating (30.09.2013) |
Current Rating (01.12.2013) |
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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
India’s current account deficit for the fiscal third quarter ended
September 2013 narrowed to $4.2 billion or 0.9 % of the gross domestic product
from $31.9 billion or 6.5 % of GDP a year earlier, thanks to a pick-up in exports
and moderation in gold imports. Manufacturing activity and new orders in India
showed their strongest growth in a year in February. The news comes as a relief
after data showed Asia’s third largest economy grew by a slower-than-expected
4.7 % annually in the three months through December. The HSBC Manufacturing
Purchasing Managers’ Index which gauges the business activity of India’s
factories but not its’ utilities, rose to 52.5 in February, its highest in a
year from 51.4 in January. Overall new orders for factory goods which rose to a
one-year high of 54.9 contributed to the surge. China has emerged as India’s
biggest trading partner in the current financial year replacing the United Arab
Emirates and pushing it to the third spot. India-China trade has reached $49.5
billion with a 8.7 % share in India’s total trade. The US comes second at $46
billion with 8.1 % share during the first nine months of the current financial
year.
The Reserve Bank of India has granted an additional nine months to the
public to exchange currency notes printed before 2005 including Rs 500 and Rs
1,000 denominations, pushing the deadline to January 1, 2015. A day before
dates for the Lok Sabha polls were announced, the government decided to hike
interest rates on fixed deposit schemes offered by post offices up to 0.2 per
cent. The new rates will be effective April, 1. The Supreme Court will resume
hearing on March, 11 Nokia’s appeal against a ruling over transferring
ownership of its local mobile phones plant which is the subject of a tax
dispute to Microsoft Corp.
In the last days of the current Government, another scam has surfaced.
The defence ministry has ordered a probe into Hindustan Aeronautics Limited’s contracts
from Britain’s Rolls-Royce Holdings worth at least $ 1.2 billion. The Central
Bureau of Investigation will look into allegations that over $80 million was
paid in kickbacks in a deal signed in 2011. India has asked Boeing Co. to
find a solution for problems with state-owned Air India’s 787 Dreamliners. The
aircraft has experienced a series of malfunctions since its debut in 2011.
EXTERNAL AGENCY RATING
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Rating Agency Name |
ICRA |
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Rating |
Long term loan AA- |
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Rating Explanation |
High degree of safety and very low credit
risk. |
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Date |
May 2013 |
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Rating Agency Name |
ICRA |
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Rating |
Commercial paper A1+ |
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Rating Explanation |
Very strong degree of safety and lowest
credit risk. |
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Date |
May 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 - CORPORATIVE (91-20-26702777)
LOCATIONS
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Registered Office/ Factory 1 : |
Mundhwa, Pune Cantonment, Pune – 411 036, Maharashtra, India |
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Tel. No.: |
91-20-26702777 / 26702476 / 26702544 |
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Fax No.: |
91-20-26822163 / 26822387 / 26820699 / 26824778 |
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E-Mail : |
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Website : |
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Area : |
5000 sq. ft. |
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Location : |
Owned |
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Factory 2 : |
Gat No. 635, Kuruli Village, Chakan, District Pune – 410 501,
Maharashtra, India |
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Factory 3 : |
Opposite Jarandeshwar Railway Station, Vadhuth, District Satara – 415
011, Maharashtra, India |
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Factory 4 : |
Kusumbe, Jalgaon-Ajantha Road, Jalgaon – 425 003, Maharashtra, India |
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Factory 5 : |
Tandulwadi and Wanjarwadi,
Taluka Baramati, District Pune – 413
206, Maharashtra, India |
DIRECTORS
As on: 31.03.2013
|
Name : |
Mr. Babasaheb Neelkanth Kalyani |
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Designation : |
Chairman and Managing Director |
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Qualification : |
B.E. (Mech.) (Hons.), M.S. (M.I.T.) |
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Date of Appointment : |
01.04.1972 |
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Name : |
Mr. G. K. Agarwal |
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Designation : |
Deputy Managing Director |
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Qualification : |
B.E. (Mech.), M.B.A. |
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Date of Appointment : |
1st November, 1976 |
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Name : |
Mr. S. M. Thakore |
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Designation : |
Director |
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Name : |
Mr. Sudhakar D. Kulkarni |
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Designation : |
Director |
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Name : |
Mr. Pratap G Pawar |
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Designation : |
Director |
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Name : |
Prof. Dr. Uwe Loos |
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Designation : |
Director |
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Name : |
Mr. Prakash Chandrashekhar Bhalerao |
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Designation : |
Executive Director |
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Qualification : |
B.E. (Elect.), M.B.A., D.T.M. |
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Date of Appointment : |
3rd March, 1987 |
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Name : |
Mrs. Lalita D Gupte |
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Designation : |
Director |
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Name : |
Mr. P. H. Ravikumar |
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Designation : |
ICICI Nominee Director |
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Name : |
Mr. Alan Spencer |
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Designation : |
Director |
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Name : |
Mr. Naresh Narad |
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Designation : |
Director |
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Name : |
Dr. T. Mukherjee |
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Designation : |
Director |
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Name : |
Mr. Amit B. Kalyani |
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Designation : |
Executive director |
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Name : |
Mr. B. P. Kalyani |
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Designation : |
Executive Director |
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Name : |
Mr. S. E. Tandale |
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Designation : |
Executive Director |
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Name : |
Mr. Sunil Chaturvedi |
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Designation : |
Executive Director |
KEY EXECUTIVES
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Name : |
Mr. Ajay Sharma |
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Designation : |
Company Secretary |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on: 31.12.2013
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Category of
Shareholder |
Total No. of
Shares |
% of Total No.
of Shares |
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(A) Shareholding of Promoter and Promoter Group |
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808115 |
0.35 |
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108009805 |
46.40 |
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108817920 |
46.75 |
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Total shareholding of Promoter and Promoter Group (A) |
108817920 |
46.75 |
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(B) Public Shareholding |
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19192271 |
8.24 |
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15327270 |
6.58 |
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6239210 |
2.68 |
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31580466 |
13.57 |
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72339217 |
31.08 |
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17686108 |
7.60 |
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20425381 |
8.77 |
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12635991 |
5.43 |
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880499 |
0.38 |
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591353 |
0.25 |
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285080 |
0.12 |
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|
4066 |
0.00 |
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51627979 |
22.18 |
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Total Public shareholding (B) |
123967196 |
53.25 |
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Total (A)+(B) |
232785116 |
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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0 |
0.00 |
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|
9200 |
0.00 |
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|
9200 |
0.00 |
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Total (A)+(B)+(C) |
232794316 |
0.00 |
BUSINESS DETAILS
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Line of Business : |
The Company is
engaged in the manufacturing and selling of forged components. |
GENERAL INFORMATION
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No. of Employees : |
Information denied by the management
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Bankers : |
Ø
Bank of India Ø
Bank of Baroda Ø
Bank of Maharashtra Ø
Canara Bank Ø
State Bank of India Ø
HDFC Bank Limited Ø
ICICI Bank Limited Ø
Axis Bank Limited Ø
Citibank N.A. Ø
Standard Chartered Bank Ø
The Royal Bank of Scotland N V Ø Credit Agricole
CIB |
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Facilities : |
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NOTE: Long-term borrowings (a) Debentures The Company has issued the following secured redeemable
non-convertible debentures (i) 2,500 -
11.95 % Redeemable secured non-convertible debentures (Sixteenth series) of
Rs. 1,000,000/- each redeemable at par in three equal annual installments on
January 5, 2015; on January 5, 2016; on January 5, 2017 respectively. Above debentures
are secured by: (i) First pari-passu mortgage in favour of the Trustees, of
all rights and interest on the Company’s immovable properties situated at
Mundhwa, Satara, Jalgaon and Chakan with negative lien on properties situated
at Jejuri and Baramati; and (ii) First pari-passu charge in favour of the
Trustees by way of hypothecation of movable properties, present and future
both such as all plant and machinery, equipments, tools, furniture and
fixtures etc., as described in Debenture Trust-cum-Mortgage Deed dated April
30, 2009. (ii) 1,760 -
10.75% Redeemable secured non-convertible debentures (Eighteenth series) of `
1,000,000/- each redeemable at par in three annual installments @ 35.00% on
April 28, 2014; @ 35.00% on April 28, 2015; @
30.00% on April 28, 2016. Above debentures
are secured by: (i) First pari-passu mortgage in favour of Trustees, of all
rights and interest on the Company’s
immovable properties, present and future situated at Mundhwa, Chakan, Satara
and Jalgaon with negative lien on properties situated at Jejuri and Baramati
as described in schedule-I as per Debenture Trustcum- Mortgage Deed dated
June 28, 2010; and (ii) First pari-passu charge in favour of the Trustees on
moveable properties, present and future as described in Schedule-II as per
Debenture Trust-cum-Mortgage Deed dated June 28, 2010. (iii) 3,500 -
10.75% Redeemable secured non-convertible debentures (Seventeenth series) of
`1,000,000/- each redeemable at par in three installments @ 25.00% on March
22, 2014; @ 50.00% on September 22, 2014; @ 25.00% on March 22, 2015. Above debentures
are secured by: (i) First pari-passu mortgage in favour of the Trustees, of
all rights and interest on the Company’s
immovable properties situated at Mundhwa, Satara, Jalgaon and Chakan with
negative lien on properties
situated at Jejuri and Baramati; and (ii) First pari-passu charge in favour
of the Trustees by way of hypothecation of
movable properties, present and future both such as, all plant and machinery,
equipments, tools, furniture and fixtures etc., as described in Debenture Trust -
cum-Mortgage Deed dated December 14, 2009. (b) Foreign currency term loans (i) From Bank of India, London Balance outstanding USD Nil (March 31, 2012: USD 2.50 Million) Secured by: (i) First
charge by way of hypothecation of the whole of the movable properties
including its movable plant and
machinery, machinery spares, tools and accessories and other movables, both
present and future, whether installed or not and whether now lying loose or
in cases or now lying or stored in or about or shall from time to time during
the continuance of the security be brought into or upon or be stored or be in
or about all the factories, premises and godowns situated at Mundhwa,
District Pune; Chakan, District Pune ; Vaduth, District Satara; Village
Kusumbe, District Jalgaon, all in the State of Maharashtra or wherever else
the same may be or be held by any party to the order of disposition or in the
course of transit or on high seas or on order, or delivery, howsoever and
wheresoever in the possession and either by way of substitution or addition
except specific movable plant and machinery consisting of Wind Energy
Converter of 600 K.V. 7 Nos. at Village Boposhi, District Satara, exclusively
hypothecated to Standard Chartered Bank, as described under the Deed of
Hypothecation dated March 17, 2005 and; (ii) Equitable mortgage by deposit of
title deeds of immovable properties situated at Village Mundhwa, Pune;
Village Vaduth, Taluka and District Satara ; Village Kusumbe Khurd, Taluka
and District Jalgaon and Village Chakan, Pune all in the State of
Maharashtra, together with all buildings and structures thereon and all plant
and machinery attached to the earth or permanently fastened to anything
attached to the earth, as described under Memorandum of Entry dated March 17,
2005. The loan was
repayable in 6 equal yearly installments starting from September 30, 2007,
along with interest of 3M LIBOR + 350 bps per annum. The Final installment
was paid during the year ended on March 31, 2013 (ii) From Credit
Agricole Corporate and Investment Bank, Singapore Balance
outstanding USD 35 Million (March 31, 2012: USD 50 Million) Secured by first
pari-passu charge over present and future movable fixed assets viz. plant and
machinery, computers, furnitures and fixtures, whether installed or not and
whether now lying loose or in cases or otherwise or being on or upon or at
any time, hereafter being on or upon about the premises and godowns at
Mundhwa, Pune; Village Kuruli, Chakan; Taluka Khed, District Pune; Village
Vaduth, Taluka and District Satara and at Baramati, Pune or anywhere
else. Repayable in 3
yearly installments from the date of its origination, i.e. October 14, 2012,
along with interest of 6M Libor + 200 bps per annum. (iii) Foreign
currency term loans on syndicated basis Balance
outstanding USD 80 Million (March 31, 2012: USD 80 Million ) Repayable in 3
half yearly installments from date of its origination i.e. October 31, 2016,
along with interest of 6M Libor + 280 bps
per annum. (iv) Foreign
currency term loans on syndicated basis Balance
outstanding USD 40 Million (March 31, 2012: Nil) Repayable in 3
half yearly installments from the date of its origination i.e. October 31,
2016, along with interest of 6M Libor + 380 bps per annum. Rupee term loans From Axis Bank Balance
outstanding Nil (March 31, 2012: Rs.330.560 Million) Secured by: (i)
First pari-passu charge on the Company’s immovable properties, present and future
situated at Mundhwa, Chakan, Satara and Jalgaon with negative lien on
properties situated at Jejuri and Baramati; and (ii) First pari-passu charge
on moveable properties, present and future including land and building.
Repayable in 18 semi annual installments from date of its origination i.e.
March 20, 2012, along with interest of base rate + 200 bps per annum. (d) Foreign
currency convertible bonds (FCCB) The Company had
issued FCCB (Tranche B) of USD 39.90 Million, detailed in the table below, to
finance capital expenditure and global acquisitions. The said bonds are
optionally convertible into GDR/Equity shares to be exercised at any time
during the exercise period at a pre determined initial price subject to
adjustments upon occurrence of certain events. In case there is non
conversion of FCCBs, the amount will be repaid in full. However, the
Company has option to redeem the balance of the above Bonds if such balance
is less than 10% in aggregate of principal amount of such tranche of bonds
originally issued in respect of each tranche, during the redemption exercise
period in the manner specified in the offering circular at a premium so as to
provide a predetermined yield to the Bondholders. The Company also
has the option to call the Bondholders of Tranche B to mandatorily convert
the Bonds into equity shares if the market price on the specified date
provided the holder a gain of at least a 30% over the Early Redemption
amount. The following table sets out
the parameters associated with Tranche B of FCCB issued as discussed above.
(d) Foreign
currency convertible bonds (FCCB) : Tranche A of the
FCCBs amounting to USD 40.00 Million outstanding as at April 26, 2012 were
redeemed on April 27, 2012 along with the redemption premium amounting to USD
17.03 Million. The premium on redemption aggregating to Rs. 994.060 Million,
(including withholding tax amounting to Rs. 98.960 Million) since
crystallized has been adjusted to securities premium account, net of deferred
tax asset amounting to Rs. 322.520 Million, in terms of Section 78(2)(d) of
the Companies Act, 1956. Tranche B of the
above FCCBs amounting to USD 39.90 Million outstanding as at April 26, 2013
were redeemed on April 26, 2013 along with the redemption premium amounting
to USD 22.54 Million. The premium on redemption aggregating to Rs. 1322.820
Million, (including withholding Tax amounting to Rs. 98.670 Million) since
crystalised has been adjusted to securities premium account, net of deferred
tax asset amounting to Rs. 429.190 Million, in terms of Section 78(2)(d) of
the Companies Act, 1956. The Company has
been legally advised by an eminent law firm that the above mentioned FCCB’s
issued upon terms and conditions set out in the offering circular dated April
19, 2005, would be outside the purview of Section 117(C) of the Companies
Act, 1956 as regards creation of Debenture Redemption Reserve. Short-term borrowings (a) Cash credit
from banks and preshipment of packing credit is secured against hypothecation
of stocks of semi finished and finished goods, raw materials, finished dies
and die blocks, work-in-progress, consumable stores and spares, book debts
etc. Cash credit is repayable on demand and carries interest @ 10.50% to
13.25% per annum Preshipment packing credit is repayable within 180 days and
carries interest @ LIBOR + 100 bps to 200 bps per annum. (b) Buyers line of credit is repayable within 180 days to 360 days and
carries interest @ EURIBOR + 90 bps to 110 bps per annum. |
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Banking
Relations : |
-- |
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Auditors : |
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|
Name : |
S.R. Batliboi and Company LLP Chartered Accountants |
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Subsidiaries : |
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Step down subsidiaries : |
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Associates : |
Technica U.K.
Limited (Investment through wholly owned subsidiary) |
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Joint Ventures : |
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Step down joint venture : |
David Brown
Bharat Forge Gear Systems India Limited |
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Enterprises
owned or significantly influenced by key management personnel or their relation |
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CAPITAL STRUCTURE
As on: 31.03.2013
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
300000000 |
Equity Shares |
Rs.2/- each |
Rs.600.000 Millions |
|
43000000 |
Cumulative Preferences Shares |
Rs.10/- each |
Rs.430.000 Millions |
|
2000000 |
Unclassified Shares |
Rs.10/- each |
Rs.20.000 Millions |
|
|
Total |
|
Rs.1050.000
Millions |
Issued Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
232970666 |
Equity Shares |
Rs.2/- each |
Rs.465.940
Millions |
|
|
|
|
|
Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
232794316 |
Equity Shares |
Rs.2/- each |
Rs.465.590
Millions |
|
172840 |
Add: Forfeited Equity Shares |
|
Rs.0.090
Million |
|
|
Total
|
|
Rs.465.680 Millions |
- Reconciliation
of the shares outstanding at the beginning and at the end of the year:
|
Particular |
As on 31.03.2013 |
|
|
|
No. of Shares |
Rs. in Millions |
|
At the beginning of the year |
232794316 |
465.590 |
|
Issued during the year |
-- |
-- |
|
|
|
|
|
Outstanding at
the end of the year |
232794316 |
465.590 |
- Terms/rights attached to equity shares
The Company has only
one class of issued equity shares having a par value of Rs. 2/- per share. Each
holder of equity shares is entitled to one vote per share. The Company declares
and pays dividend in Indian rupees. The dividend proposed by the Board of
Directors is subject to the approval of the shareholders in the ensuing Annual
General Meeting.
During the year
ended March 31, 2013, the amount of per share interim dividend recognised as
distributions to equity shareholders was Rs. 1.00/- (March 31, 2012:
Rs.1.50/-).
During the year
ended March 31, 2013, the amount of per share proposed final dividend
recognised as distributions to equity shareholders was Rs. 2.40/- (March 31,
2012: Rs. 2.50/-).
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.
- Shares held by holding/ultimate holding company and/or their
subsidiaries/associates
The Company being
ultimate holding company there are no shares held by any other holding,
ultimate holding company and their subsidiaries/associates.
- Aggregate number of bonus shares issued, shares issued for consideration
other than cash and shares bought back during the period of five years
immediately preceding the reporting date
There are no bonus
shares issued, shares issued for consideration other than cash and shares
bought back during the period of five years immediately preceding reporting
date.
- Details
of shareholders holding more than 5% of the aggregate shares in the
Company:
|
Particular |
As on 31.03.2013 |
|
|
|
No. of Shares
Held |
% of Holding |
|
Kalyani Investment Company Limited |
31656095 |
13.60 |
|
KSL Holdings Private Limited |
23142870 |
9.94 |
|
Sundaram Trading and Investment Private Limited |
20986337 |
9.01 |
|
Life Insurance Corporation of India |
20358099 |
8.74 |
|
Reliance Capital Trustee Company Limited |
12151369 |
5.22 |
* The shareholding
information is based on legal ownership of shares and has been extracted from
the of the Company including register of shareholders/members.
- Shares reserved for issue under options
|
Particulars |
31.03.2013 |
|
Warrants issued
with option to subscribe |
6500000 |
|
The issue of
Foreign Currency Convertible Bonds optionally convertible at an initial price
specified in offering circular. As the initial price is subject to adjustments
specified in the offering circular and hence inability to assess the
proportion of conversion, no amounts have been shown under issued equity
share capital, in respect of equity shares reserved for issued on exercise of
conversion by bondholders |
-- |
|
2,340 equity
shares of Rs. 2/- each out of the previous issue of equity shares on a right
basis together with 234 detachable warrants entitled to subscription of 1,170
equity shares of Rs. 2/- each, have been kept in abeyance and reserve for
issue pending adjudication of title to the pre right holding |
3510 |
- Terms of securities convertible into equity shares
- The Company had issued and allotted to Qualified Institutional
Buyers, 10,000,000 equity shares of Rs. 2/- each at a price of Rs. 272/-
per share aggregating to Rs. 2720.000 Million on April 28, 2010,
simultaneous with the issue of 1,760 10.75% Non Convertible Debentures
(NCD) of a face value of Rs. 1,000,000/- at par, together with 6,500,000
warrants at a price of Rs. 2/- each entitling the holder of each warrant
to subscribe for 1 equity share of Rs. 2/- each at a price of Rs. 272/- at
any time within 3 years from the date of allotment. The subscription money
received on issue of warrants has been credited to capital reserve as the
same is not refundable/adjustable. Out of the funds raised, Rs. 2365.000
Million had been temporarily deployed in fixed deposits with banks and in
mutual funds and the balance has been utilized towards the object of the
issue. The Warrant holders were entitled to exercise their right to
exchange the warrants into corresponding number of equity shares, upto
April 28, 2013. As no warrant have been exercised on or before the said
warrant exercised period, the warrants have lapsed and ceased to be valid.
- Regarding Foreign Currency Convertible Bonds.
- Global depository receipts
The Company had
issued 3,636,500 equity shares of Rs.10/- each (later sub-divided into
18,182,500 equity shares of Rs. 2/- each) in April and May 2005 represented by 3,636,500
Global Depository Receipts (GDR) (on sub division 18,182,500 GDRs) evidencing
“Master GDR Certificates” at a price of USD 27.50 per GDR (including premium).
GDRs outstanding at the close of the year are 9,200 (March 31, 2012: 9,200).
The funds raised has been utilised towards the object of the issue.
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 |
465.680 |
465.680 |
465.680 |
|
(b) Reserves & Surplus |
22645.640 |
20965.270 |
19488.180 |
|
(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) |
23111.320 |
21430.950 |
19953.860 |
|
|
|
|
|
|
(3)
Non-Current Liabilities |
|
|
|
|
(a) long-term borrowings |
14489.800 |
16003.980 |
13941.370 |
|
(b) Deferred tax liabilities (Net) |
1364.300 |
1271.520 |
1556.190 |
|
(c) Other long term
liabilities |
7.400 |
7.150 |
5.880 |
|
(d) long-term
provisions |
332.920 |
327.900 |
274.900 |
|
Total Non-current
Liabilities (3) |
16194.420 |
17610.550 |
15778.340 |
|
|
|
|
|
|
(4) Current Liabilities |
|
|
|
|
(a) Short term
borrowings |
390.110 |
840.980 |
661.300 |
|
(b) Trade payables |
4541.150 |
6656.180 |
6164.330 |
|
(c) Other current
liabilities |
6282.110 |
5375.780 |
875.950 |
|
(d) Short-term
provisions |
908.040 |
1367.260 |
1206.930 |
|
Total Current
Liabilities (4) |
12121.410 |
14240.200 |
8908.510 |
|
|
|
|
|
|
TOTAL |
51427.150 |
53281.700 |
44640.710 |
|
|
|
|
|
|
II.
ASSETS |
|
|
|
|
(1) Non-current assets |
|
|
|
|
(a) Fixed Assets |
|
|
|
|
(i) Tangible assets |
19988.080 |
17961.990 |
17632.570 |
|
(ii) Intangible Assets |
0.000 |
0.000 |
0.000 |
|
(iii) Capital
work-in-progress |
2228.060 |
2887.570 |
784.380 |
|
(iv)
Intangible assets under development |
0.000 |
0.000 |
0.000 |
|
(b) Non-current Investments |
5453.460 |
5115.520 |
5716.260 |
|
(c) Deferred tax assets (net) |
0.000 |
0.000 |
0.000 |
|
(d) Long-term Loan and Advances |
3863.350 |
4036.890 |
3442.210 |
|
(e) Other
Non-current assets |
423.890 |
588.050 |
417.350 |
|
Total Non-Current
Assets |
31956.840 |
30590.020 |
27992.770 |
|
|
|
|
|
|
(2) Current assets |
|
|
|
|
(a) Current investments |
3852.990 |
4246.970 |
2427.250 |
|
(b) Inventories |
4757.010 |
5031.340 |
4684.340 |
|
(c) Trade receivables |
4742.320 |
4911.750 |
4313.210 |
|
(d) Cash and cash
equivalents |
2790.780 |
5005.940 |
2320.400 |
|
(e) Short-term loans
and advances |
2570.550 |
2702.420 |
2124.750 |
|
(f) Other current
assets |
756.660 |
793.260 |
777.990 |
|
Total Current Assets |
19470.310 |
22691.680 |
16647.940 |
|
|
|
|
|
|
TOTAL |
51427.150 |
53281.700 |
44640.710 |
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2013 |
31.03.2012 |
31.03.2011 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
31512.270 |
36859.740 |
29470.040 |
|
|
|
Other Income |
916.250 |
675.700 |
465.430 |
|
|
|
TOTAL |
32428.520 |
37535.440 |
29935.470 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of raw material and components consumed |
13430.860 |
16496.200 |
13661.520 |
|
|
|
Decrease/(increase) in inventories of finished goods and
work-in-progress |
141.460 |
(162.120) |
(358.320) |
|
|
|
Employee benefits expense |
2573.880 |
2549.640 |
2104.770 |
|
|
|
Other expenses |
8210.320 |
8823.000 |
6906.820 |
|
|
|
TOTAL |
24356.520 |
27706.720 |
22314.790 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION |
8072.000 |
9828.720 |
7620.680 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES |
1533.590 |
1504.650 |
1214.420 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION |
6538.410 |
8324.070 |
6406.260 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/ AMORTISATION |
2239.330 |
2149.330 |
1932.680 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE EXCEPTIONAL ITEMS AND TAX |
4299.080 |
6174.740 |
4473.580 |
|
|
|
|
|
|
|
|
|
Add |
EXCEPTIONAL ITEMS AND TAX |
105.690 |
(704.160) |
0.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX |
4404.770 |
5470.580 |
4473.580 |
|
|
|
|
|
|
|
|
|
Less |
TAX |
1348.840 |
1849.850 |
1365.330 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX |
3055.930 |
3620.730 |
3108.250 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
10051.890 |
8284.100 |
6833.230 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Interim Dividend on Equity Shares |
232.790 |
349.190 |
0.000 |
|
|
|
Tax on above dividend |
37.760 |
56.650 |
0.000 |
|
|
|
Proposed Final Dividend on Equity Shares |
558.710 |
581.990 |
814.780 |
|
|
|
Tax on above dividend |
94.950 |
94.410 |
132.180 |
|
|
|
Debenture Redemption Reserve |
408.600 |
408.600 |
399.420 |
|
|
|
Transfer to General Reserve |
305.600 |
362.100 |
311.000 |
|
|
BALANCE CARRIED
TO THE B/S |
11469.410 |
10051.890 |
8284.100 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
F.O.B. value of exports |
15613.350 |
17309.920 |
12110.340 |
|
|
|
Insurance and freight on Exports |
189.200 |
457.280 |
347.620 |
|
|
|
Tooling Charges |
252.950 |
37.170 |
84.750 |
|
|
|
Sale of Certified Emission Reduction Units |
-- |
-- |
3.450 |
|
|
|
Interest received on Fixed Deposits / Others |
0.090 |
0.020 |
0.700 |
|
|
|
Interest on Loan to Subsidiary |
29.560 |
33.360 |
22.050 |
|
|
|
Guarantee commission |
4.590 |
4.480 |
0.000 |
|
|
TOTAL EARNINGS |
16089.740 |
17842.230 |
12568.910 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
661.380 |
472.120 |
448.180 |
|
|
|
Die Blocks, Die Steel, Tool Steel & Spares |
718.260 |
715.260 |
498.540 |
|
|
|
Capital Goods |
865.890 |
1311.160 |
448.980 |
|
|
TOTAL IMPORTS |
2245.530 |
2498.540 |
1395.700 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
|
|
|
|
|
|
Basic |
13.13 |
15.55 |
13.39 |
|
|
|
Diluted |
13.13 |
15.53 |
13.11 |
|
QUARTERLY /
SUMMARISED RESULTS
|
PARTICULARS |
30.06.2013 1st
Quarter |
30.09.2013 2nd
Quarter |
31.12.3013 3rd
Quarter |
|
Audited / UnAudited |
UnAudited |
UnAudited |
UnAudited |
|
Net Sales |
7915.600 |
8451.100 |
8320.800 |
|
Total Expenditure |
5954.600 |
6223.300 |
6176.000 |
|
PBIDT (Excl OI) |
1961.000 |
2227.800 |
2144.800 |
|
Other Income |
354.200 |
212.900 |
253.900 |
|
Operating Profit |
2315.200 |
2440.700 |
2398.700 |
|
Interest |
354.300 |
393.500 |
399.400 |
|
Exceptional Items |
0.000 |
0.000 |
0.000 |
|
PBDT |
1960.900 |
2047.200 |
1999.300 |
|
Depreciation |
610.700 |
627.700 |
616.600 |
|
Profit Before Tax |
1350.200 |
1419.500 |
1382.700 |
|
Tax |
444.200 |
455.700 |
443.000 |
|
Provisions and contingencies |
0.000 |
0.000 |
0.000 |
|
Profit After Tax |
906.000 |
963.800 |
939.700 |
|
Extraordinary Items |
0.000 |
0.000 |
0.000 |
|
Prior Period Expenses |
0.000 |
0.000 |
0.000 |
|
Other Adjustments |
0.000 |
0.000 |
0.000 |
|
Net Profit |
906.000 |
963.800 |
939.700 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2013 |
31.03.2012 |
31.03.2011 |
|
PAT / Total Income |
(%) |
9.42
|
9.65 |
10.38 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
13.98
|
14.84 |
15.18 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
10.07
|
12.08 |
11.73 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.19
|
0.25 |
0.22 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Debt /Networth) |
|
0.64
|
0.79 |
0.73 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.61
|
1.59 |
1.87 |
FINANCIAL ANALYSIS
[all figures are
in Rupees Millions]
DEBT EQUITY RATIO
|
Particular |
31.03.2011 |
31.03.2012 |
31.03.2013 |
|
|
(Rs.
In Millions) |
(Rs.
In Millions) |
(Rs.
In Millions) |
|
Share Capital |
465.680 |
465.680 |
465.680 |
|
Reserves & Surplus |
19488.180 |
20965.270 |
22645.640 |
|
Net
worth |
19953.860 |
21430.950 |
23111.320 |
|
|
|
|
|
|
long-term borrowings |
13941.370 |
16003.980 |
14489.800 |
|
Short term borrowings |
661.300 |
840.980 |
390.110 |
|
Total
borrowings |
14602.670 |
16844.960 |
14879.910 |
|
Debt/Equity
ratio |
0.732 |
0.786 |
0.644 |
YEAR-ON-YEAR GROWTH
|
Year
on Year Growth |
31.03.2011 |
31.03.2012 |
31.03.2013 |
|
|
(Rs.
In Millions) |
(Rs.
In Millions) |
(Rs.
In Millions) |
|
Sales |
29470.040 |
36859.740 |
31512.270 |
|
|
|
25.075 |
(14.508) |
NET PROFIT MARGIN
|
Net
Profit Margin |
31.03.2011 |
31.03.2012 |
31.03.2013 |
|
|
(Rs.
In Millions) |
(Rs.
In Millions) |
(Rs.
In Millions) |
|
Sales |
29470.040 |
36859.740 |
31512.270 |
|
Profit |
3108.250 |
3620.730 |
3055.930 |
|
|
10.55% |
9.82% |
9.70% |
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 |
Yes |
|
5] |
Type of Business |
Yes |
|
6] |
Line of Business |
Yes |
|
7] |
Promoter's background |
Yes |
|
8] |
No. of employees |
No |
|
9] |
Name of person contacted |
No |
|
10] |
Designation of contact
person |
No |
|
11] |
Turnover of firm for last
three years |
Yes |
|
12] |
Profitability for last
three years |
Yes |
|
13] |
Reasons for variation
<> 20% |
---------------------- |
|
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 |
Yes |
|
32] |
PAN of
Proprietor/Partner/Director, if available |
No |
|
33] |
Voter ID No of
Proprietor/Partner/Director, if available |
No |
|
34] |
External Agency Rating,
if available |
Yes |
LITIGATION DETAILS
|
HIGH COURT OF
BOMBAY |
|
CASE DETAILS BENCH: BOMBAY |
|
Lodging No: ITXAL/1607/2011 Filing Date:
23.12.2011 Reg. No.: ITXA/179/2012 Reg. Date: 15.10.2012 |
|
Petitioner: THE COMMISSIONER OF INCOME TAX -
Respondent: BHARAT FORGE LIMITED Petn. Adv : VIMAL GUPTA (0) District: PUNE |
|
Bench: DIVISION Status: Admitted (Unready) Category:
TAX APPEALS Last Date:
26.03.2013
Stage: FOR ADMISSION – FRESH Last Coram: HON’BLE SHRI JUSTICE J.P. DEADHAR HON’BLE SHRI JUSTICE
M.S. SANKLECHA |
|
Act: Income Tax Act, 1961 UNDER SECTION: 260A |
UNSECURED LOAN:
|
Particulars |
31.03.2013 [Rs.
in Millions] |
31.03.2012 [Rs.
in Millions] |
|
Long Term
Borrowing |
|
|
|
On syndication basis |
4345.600 |
4071.200 |
|
On syndication basis |
2172.800 |
0.000 |
|
|
|
|
|
Foreign currency convertible bonds (FCCB ) |
|
|
|
USD 40.0 Million
(March 31, 2012: USD 40.0 Million) 0% Tranche A FCCBs (Redeemed on April 28, 2012) |
0.000 |
0.000 |
|
USD 39.9 Million
(March 31, 2012: USD 39.9 Million) 0% Tranche B FCCBs (Redeemable on April 28, 2013) |
0.000 |
2030.510 |
|
|
|
|
|
Sales tax deferral liability |
|
|
|
Under Government
of Maharashtra Package Scheme of Incentives |
0.000 |
69.440 |
|
|
|
|
|
Short Term
Borrowing |
|
|
|
Buyers line of credit for import of goods from banks |
291.890 |
77.260 |
|
|
|
|
|
Total |
6810.290 |
6248.410 |
CORPORATE
INFORMATION
The Company is a
public company domiciled in India and incorporated under the provisions of the Companies
Act, 1956. Its shares are listed on two stock exchanges in India. The Company
is engaged in the manufacturing and selling of forged components. The Company
caters to both domestic and international markets.
GLOBAL AND INDIAN
ECONOMIC OVERVIEW
The world economy
continued to struggle in CY 2012 with a visible slowdown in the emerging market
and developing economies, a reflection of the sharp decline in demand from
economies like USA and Eurozone Area, domestic policy tightening, and the end
of investment booms in some of the major emerging markets. Developing economies
are still the main driver of global growth, but their output has slowed
compared with the pre-crisis period.
Over the past few
months, two of the biggest threats to global recovery have been temporarily
averted, a Euro area breakup and a sharp fiscal contraction in the United
States from the “fiscal cliff.”
Overall global
growth for the year came in at 3.2 percent in 2012 as against 4.0 percent in CY
2011 and is expected to grow by 4.0 percent in CY13. (Source: IMF)
India faced its
own share of problems driven by protracted weakness in industrial activity and
slowdown in the services sector. India’s quarterly GDP growth declined for the
seven consecutive quarters in October – December 2012, hitting a nine-year low
of 4.7 percent. (Source: RBI). GDP% for the January – March 2013 quarter
registered 4.8 percent and for the year GDP% came in at 5.0 percent as against
6.2 percent in the previous fiscal.
GLOBAL AUTOMOBILE
INDUSTRY
The global
automobile industry is highly concentrated, in USA, Europe, Japan, China,
Brazil, India and Korea, covering a major share of the pie. Global vehicle
production reached a record 84.1 Million in numbers in 2012 (Source: OICA), up
5 percent over the previous year.
Most of the global
automotive markets witnessed a concurrent demand decline for both mass market
passenger cars and commercial vehicles (CVs), impacted by a weak demand
environment. The demand was dampened due to low levels of economic activities
across regions. There was a subsequent demand decline across all the major
regions except North America, where the passenger car sales continue to surge.
Automotive Sales in the Eurozone auto industry remained depressed due to the
challenging economic conditions, and this downtrend is expected to continue for
some time. However, CV sales in Western Europe are likely to remain stable to
slightly positive as compared to previous year.
China and India
witnessed weak automotive demand on back of slackening economic demand. In
2012, Indian automotive market witnessed one of its most challenging periods
while china witnessed a slump demand which is estimated to report auto sales of
19 Million, growing at single digit rate, one of the lowest in many years
(Source: Global Auto Report -Scotia Bank, 2012).
EXPORTS
BFL is a major
supplier of safety and critical components for the automotive (passenger and
CV) and industrial sector. These components provided to passenger and CVs are
critical, safety and high value-added. BFL enjoys the privilege of strong
relationship with global OEMs spread across automotive and industrial sectors.
The Company has
successfully expanded its relationships across various geographies, notably in
Brazil and Japan. This has been achieved on the back of BFL’s deep engagement
with global OEMs and its ability to by supply critical and technologically
differentiated products.
The Company has
transformed its industrial business from serving just one or two product
categories to limited customers, to a separate business vertical with a dynamic
product offering across customers, geographies and segments.
Similar to the
domestic business, BFL has a limited exposure to the passenger vehicles through
exports. However, with the industry moving towards better fuel efficiency and
stringent emission norms through the use of lighter engines, they will require
high-performance parts. BFL is making significant progress with substantial
efforts aimed towards this space. It is confident of achieving success in
increasing its exposure to this segment in the coming years.
SUBSIDIARIES
Global subsidiaries
BFL’s global
subsidiaries help contribute to the development of the entire Group. These
subsidiaries allow the Company to:
- Increase customer penetration and proximity to the customer,
- Cross fertilisation of best practices and exchange of technology,
- Enhance the ability to cater to the customers through a dual-shore
based model which will reduce the customer’s dependency on the no. of
suppliers for different components.
Following a good
year in CY 2011, all the global subsidiaries of the Company focused on cost
reductions, right sizing of organisation and new market development. However,
global markets have been extremely volatile in second half of CY 2012 resulting
in lackluster performance of the subsidiaries.
Europe: Performance of European subsidiaries was
adversely affected in CY 2012 on backdrop of lower demand in the underlying
markets. The subsidiaries have focused on improvement in productivity, lean
organisation and cost reduction. As a result of these initiatives, European
subsidiaries have been able to achieve profitability during these uncertain
market conditions. These companies
continue to develop new products, increasing share of business with
Customers and focus of improvement in operational performance
USA: In November 2012, US subsidiary of the
Company – Bharat Forge America Inc. (BFA) closed its manufacturing operations
due to sustained losses. Most of the existing business of BFA was transferred
to India thereby protecting the business within the Group. Subsequently all
assets of BFA were sold in US in May 2013 for $ 11.25 Million. Loss for CY 2012
due to such discontinued business was Rs.168.000 Million.
China: Performance of Joint Venture in China was
adversely affected by drop in underlying market in China. The drop in market
was severe especially in commercial vehicle market (drop of 30 percent over
last year) and construction market (drop of 70 percent over last year). As a
result, the capacity utilisation of Joint Venture Company was far below
break-even level resulting in higher losses in CY 2012.
Indian subsidiaries
BFL has been
foraying into the capital goods and infrastructure business segments (both
offer major growth opportunities) through investments in JVs and subsidiaries.
Alstom Bharat Forge Power Limited (ABFPL) and
Kalyani Alstom Power Limited (KAPL)
India’s Planning
Commission projects that the country needs at least 35-40 GW of additional
generation capacity annually to reach the necessary installed capacity of 800
GW by 2030. Alstom Bharat Forge Power Limited (ABFPL) and Kalyani Alstom Power
Limited (KAPL) are two JV companies of BFL with Alstom. These JVs design,
engineer and manufacture state-of the- art power equipment, including turbines,
generators, heat exchangers range for power plant units of 300 MW to 800 MW.
ABFPL has been awarded two prestigious orders by NTPC Limited. The first one, a
2X660 MW supercritical Turbine Generator Islands is set to be installed at
Solapur in Maharashtra, while a 3X660 MW supercritical turbine generator
islands is going to be installed at Nabinagar in Bihar. Both of these projects,
together constituting robust orders of Rs.38000.000 Million, are being
implemented and all key design and engineering milestones for these have been
met.
BF Infrastructure Limited (BFIL)
BFL’s wholly-owned
subsidiary, BFIL, endeavors to be a key contributor in India’s infrastructure growth
through a niche and dominant role in a few important segments including power.
The Company possesses a host of key enablers, including a talent pool with
nearly 1,500 man-years of proven project experience. It is currently setting up
a 450 MW (3X150 MW) coal based thermal power plant at Haldia, West Bengal, for
India Power Corporation (Haldia) Limited on EPC basis at a cost of Rs.18850.000
Million. After suffering from initial delays due to land related problems, the
project is under implementation now. It is expected to be completed with all
the three turbines proposed to be commissioned in the next financial year.
BF-NTPC Energy Systems
BFL’s JV with
NTPC, namely BF-NTPC Energy Systems Limited, has identified critical shortages
in the domestic availability of products, such as high-pressure piping, special
castings, valves and pumps, which retard timely completion of the country’s
power plants. Due to current depressed market conditions in the power sector,
BF-NTPC Energy Systems Limited has decided to put the project on hold and
revisit it once demand in the sector revives.
David Brown Bharat Forge Gear Systems India Limited
David Brown Bharat
Forge Gear Systems India Limited is a JV company located in Pune and serves
India’s industrial market. It supplies both newly build gearboxes and
comprehensive aftermarket services to sectors, such as power, mining, defense,
wind, rail and steel. In the first phase, the JV has established service centre
in Hosur, Karnataka and will set up a manufacturing facility in the second
phase once the demand in the capital goods/power sector revives.
FINANCIAL REVIEW
Total income FY13
witnessed a decline in total income by about 13.5 percent from Rs. 37474.000
Million in FY12 to Rs. 32429.000 Million in FY13. The decline was largely due
to a continued slump in automotive demand and drop in component sales to the
industrial sectors both in India and overseas markets.
The demand for
India’s industrial segment was impacted by global slowdown across markets. In
India, the industrial sales were primarily impacted due to weak investment
sentiments and a slowdown in industrial activities. Rest of the markets faced
declining demand from various infrastructural activities.
Income
Domestic sales
decreased by 18.9 percent on the back of 27 percent decline in volumes in the
MandHCV segment and order declines in the industrial sector in India.
Export sales
declined by 8.5 percent on back of slump in demand across auto and industrial
segments across all major geographies. Export realisation improved during the
year on back of rupee depreciation against major currencies and also increase
in supply of machined components.
Other Operating
income (Export Incentive) declined during the year due to reduction in
incentive rates. Other income increased 49.2 percent from Rs.614.000 Million to
Rs. 916.000 Million. Overall, total income reduced 13.54 percent from
Rs.37474.000 Million to Rs. 32429.000 Million.
Expenditure
Raw Material as percent
of total income decreased from 43.6 percent in FY12 to 41.9 percent in FY13 on
improved
Machining and
higher realisation per tonne. Manufacturing cost as percent of total income
increased from 17.2 percent to 18.4 percent due to increase in Power cost which
increased from Rs.6.76 per Kwh in FY12 to Rs. 7.74 Kwh in FY13.
Salary cost
increased from 6.8 percent to 7.9 percent on primarily on account of sudden
drop in demand which had an impact on total income. Other expenditure remained
more or less flat at 6.4 percent on a YoY basis.
EBITDA %
marginally declined by 60 bps from 26.1 percent to 25.5 percent despite a more
than a 10 percent decline in top line on back of measures taken towards the end
of the fiscal to reduce cost in line with the lower demand environment.
Depreciation and
Interest Cost increased from 9.2 percent to 11.6 percent on back of new
machining lines getting commissioned in the fiscal and replacement of US$ 39.9
Million Zero Coupons FCCB with an ECB of similar amount.
OUTLOOK
Economic
uncertainties, along with a decline in automotive and industrial sectors in its
primary markets, namely India, the US and the Eurozone nations, adversely
impacted BFL’s performance in FY13. Despite the Company’s recovery initiatives
through cost control and increased productivity, the domestic as well as export
outlook for the first two quarters of FY14 remain sluggish.
STATEMENT OF STANDALONE UNAUDITED FINANCIAL RESULTS FOR THE
QUARTER AND NINE MONTHS ENDED 31ST DECEMBER, 2013
|
|
|
Quarter Ended |
Nine Months Ended |
|
|
|
|
31.12.2013 |
30.09.2013 |
31.12.2013 |
|
1 |
Income from operations |
|
|
|
|
|
- Domestic |
3619.800 |
3952.300 |
11718.500 |
|
|
-
F.O.B. value of exports and
corresponding income |
4797.300 |
4633.800 |
13403.300 |
|
|
Total sales |
8417.100 |
8586.100 |
25121.800 |
|
|
Less : Excise duty |
330.900 |
372.300 |
1105.300 |
|
|
Total net sales (net of excise duty) |
8086.200 |
8213.800 |
24016.500 |
|
|
b) Other operating income |
234.600 |
237.300 |
671.000 |
|
|
Total income from operations (net) (a + b) |
8320.800 |
8451.100 |
24687.500 |
|
2 |
Expenses: |
|
|
|
|
|
Cost of materials consumed |
3401.400 |
3266.600 |
10015.100 |
|
|
Changes in inventories of finished goods, work-in-progress and stock-in-trade |
(205.700) |
170.400 |
(130.400) |
|
|
Employee benefits expense |
697.100 |
694.800 |
2098.900 |
|
|
Depreciation, amortisation and obsolescence1991.700 |
616.600 |
627.700 |
1855.000 |
|
|
Manufacturing expenses |
1600.900 |
1419.900 |
4405.600 |
|
|
Other expenses |
682.300 |
671.600 |
1964.700 |
|
|
Total expenses |
6792.600 |
6851.000 |
20208.900 |
|
3 |
Profit from operations before other income, finance costs and exceptional items (1-2) |
1528.200 |
1600.100 |
4478.600 |
|
4 |
Other income |
253.900 |
212.900 |
821.000 |
|
5 |
Profit from ordinary activities before finance costs and exceptional items (3+4) |
1782.100 |
1813.000 |
5299.600 |
|
6 |
Finance costs |
399.400 |
393.500 |
1147.200 |
|
7 |
Profit from ordinary activities after finance costs but before exceptional items (5-6) |
1382.700 |
1419.500 |
4152.400 |
|
8 |
Exceptional items |
-- |
-- |
-- |
|
9 |
Profit from
ordinary activities before tax (7+8) |
1382.700 |
1419.500 |
4152.400 |
|
10 |
Taxes expenses |
443.000 |
455.700 |
1342.900 |
|
11 |
Net profit after tax from ordinary activities (9-10) |
939.700 |
963.800 |
2809.500 |
|
12 |
Extraordinary items |
-- |
-- |
-- |
|
13 |
Net profit after
tax for the period (11+12) |
939.700 |
963.800 |
2809.500 |
|
14 |
Paid-up equity share capital (face value of share: Rs. 2 each) |
465.700 |
465.700 |
465.700 |
|
15 |
Reserves excluding revaluation reserve Earnings per share (Not annualised): |
|
|
|
|
16 |
Basic EPS before extraordinary items (Rs.) |
4.04 |
4.14 |
12.07 |
|
|
Diluted EPS before extraordinary items (Rs.) |
4.04 |
4.14 |
12.07 |
|
|
Additional Information : |
|
|
|
|
|
Profit before tax, before exchange gain / (loss) & exceptional items |
1412.500 |
1426.700 |
4014.700 |
SELECT INFORMATION FOR THE QUARTER AND NINE MONTHS ENDED
31ST DECEMBER, 2013
|
A |
PARTICULARS OF
SHAREHOLDING |
|
|
|
|
|
1 |
Public shareholding |
|
|
|
|
|
|
a. |
Number of shares |
123967196 |
123967196 |
123967196 |
|
|
b. |
Percentage of shareholding |
53.25% |
53.25% |
53.25% |
|
2 |
Promoters and promoter group shareholding |
|
|
|
|
|
|
a. |
Pledged/Encumbered |
|
|
|
|
|
Number of shares |
0 |
0 |
0 |
|
|
|
|
Percentage of shares (as a % of the total shareholding of promoter and
promoter group) |
0 |
0 |
0 |
|
|
|
Percentage of shares (as a % of the total share capital of the
Company) |
0 |
0 |
0 |
|
|
b. |
Non-encumbered |
|
|
|
|
|
Number of shares |
108817920 |
108817920 |
108817920 |
|
|
|
|
Percentage of shares (as a % of the total shareholding of promoter and
promoter group) |
100.00% |
100.00% |
100.00% |
|
|
|
Percentage of shares (as a % of the total share capital of the
Company) |
46.74% |
46.74% |
46.74% |
|
B |
INVESTOR COMPLAINTS |
3 months ended 31.12.2013 |
|
|
Pending at the beginning of the quarter |
Nil |
|
|
Received during the quarter |
2 |
|
|
Disposed of during the quarter |
2 |
|
|
Remaining unresolved at the end of the quarter |
Nil |
NOTE:
- The above results
have been reviewed by the Audit Committee and approved by the Board of
Directors of the Company at their respective meetings held on February 04,
2014. The Statutory Auditors of the Company have carried out a
"Limited Review" of the results for the Quarter ended December
31, 2013.
- Earnings per share
have been computed in accordance with the principles laid down by
Accounting Standard (AS) 20
- During the quarter
the company's indirect overseas subsidiary has divested its 51.85% stake
in its Chinese JV operations (FAW Bharat Forge (Changchun) Company
Limited) to its Joint Venture partner, China FAW Corporation Limited, for
US$ 28.208 million (` 175
Crores) ending its 8 years old Joint Venture in China. The effective date
for divestment was October 31, 2013
- The
Board has declared an interim dividend for the financial year 2013-14 at
the rate of Rs. 2/- per share (100% on the face value of Rs.2/- each). The
record date for the same has been fixed as February 14, 2014 and the
dividend shall be paid on February 28, 2014.
- Previous
year/ period's figures are regrouped/ restated wherever necessary to make
them comparable with those of the current period.
STANDALONE SEGMENT WISE REVENUE, RESULTS AND CAPITAL EMPLOYED FOR THE QUARTER AND NINE MONTHS ENDED 31ST
DECEMBER, 2013
|
Particulars |
Quarter Ended |
Nine Months Ended |
|
|
|
31.12.2013 |
30.09.2013 |
31.12.2013 |
|
Segment Revenue: |
|
|
|
|
Steel Forging |
8287.900 |
8407.900 |
24580.500 |
|
Others |
60.000 |
78.600 |
199.800 |
|
Total |
8347.900 |
8486.500 |
24780.300 |
|
Less: Inter
Segment Revenue |
27.100 |
35.400 |
92.800 |
|
Net Sales / Income
from Operations |
8320.800 |
8451.100 |
24687.500 |
|
Segment Results: Profit/(Loss) (before tax and finance costs from each
segment) |
|
|
|
|
Steel Forging |
2179.900 |
2139.400 |
6139.200 |
|
Others |
1.800 |
42.900 |
76.500 |
|
Total |
2181.700 |
2182.300 |
6215.700 |
|
Less: (i) Finance
costs |
399.400 |
393.500 |
1147.200 |
|
(ii) Other Un-allocable expenditure net off Un-allocable income |
399.600 |
369.300 |
916.100 |
|
Total Profit
before tax and exceptional items |
1382.700 |
1419.500 |
4152.400 |
|
Exceptional items Total Profit Before tax |
-- |
-- |
-- |
|
Capital Employed (Segment assets -Segment Liabilities) |
|
|
|
|
Steel Forging - |
27899.400 |
27708.600 |
27899.400 |
|
Others |
1408.100 |
1470.600 |
1408.100 |
|
Unallocable Assets
less Liabilities |
|
|
|
|
-Investments in Subsidiaries/Joint Ventures |
5244.700 |
5187.200 |
5244.700 |
|
others |
13373.300 |
13769.100 |
13373.300 |
|
Total |
47925.500 |
48135.500 |
47925.500 |
|
Secondary information
in respect of Geographical segment on the basis of location of customers |
|
|
|
|
Segment Revenue: |
|
|
|
|
(a) Within India |
3523.500 |
3817.300 |
11284.200 |
|
(b)Outside India |
4797.300 |
4633.800 |
13403.300 |
|
Total |
8320.800 |
8451.100 |
24687.500 |
The Company has identified its business segment as
its primary reporting segment which comprises of "Steel forgings" and
"others". Secondary information is reported geographically.
The "Steel forging" segment produces and sells
steel forging products comprising of steel forgings, finished machined
crankshafts, front axle assembly and components and ring rolling etc. The
"Others" segment includes general engineering and windmill operations
etc.
The Company on standalone basis operated through a
single geographic segment where all assets are located in India. Secondary
segment disclosures have been made accordingly
FIXED ASSETS:
œ
Land, Free hold
œ
Land, lease hold
œ
Buildings
œ
Plant and Machinery
œ
Railway Sidings
œ
Electrical Installations
œ
Factory Equipments
œ
Engineering Instruments
œ
Furniture and Fittings
œ
Office Equipments
œ
Vehicles and Aircrafts
œ
Leased assets ( Plant and Machinery)
œ
Leased assets (Power line)
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.60.32 |
|
|
1 |
Rs.100.04 |
|
Euro |
1 |
Rs.82.65 |
INFORMATION DETAILS
|
Information
Gathered by : |
NYA |
|
|
|
|
Analysis Done by
: |
SUM |
|
|
|
|
Report Prepared
by : |
ANK |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
6 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
8 |
|
--PROFITABILIRY |
1~10 |
8 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
7 |
|
--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 |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
DEFAULTER |
|
|
|
--RBI |
YES/NO |
NO |
|
--EPF |
YES/NO |
NO |
|
TOTAL |
|
66 |
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.