MIRA
INFORM REPORT
|
Report Date : |
02.01.2014 |
IDENTIFICATION DETAILS
|
Name : |
SHANTHI GEARS LIMITED |
|
|
|
|
Registered
Office : |
304-A,
|
|
|
|
|
Country : |
|
|
|
|
|
Financials (as
on) : |
31.03.2013 |
|
|
|
|
Date of
Incorporation : |
01.07.1972 |
|
|
|
|
Com. Reg. No.: |
18-000649 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs.81.700 Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
L29130TZ1972PLC000649 |
|
|
|
|
IEC No.: |
0488030421 |
|
|
|
|
TAN No.: [Tax Deduction &
Collection Account No.] |
CMBS03147E |
|
|
|
|
PAN No.: [Permanent Account No.] |
AADCS06922 |
|
|
|
|
Legal Form : |
A Public Limited Liability Company. The Company’s Shares are Listed on
the Stock Exchanges. |
|
|
|
|
Line of Business
: |
Manufacturer of Gears and Gear Products. |
|
|
|
|
No. of Employees
: |
581 (Approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
A (63) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
Maximum Credit Limit : |
USD 10303000 |
|
|
|
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a well-established company having fine track record. There appears dip in the profitability of the company during the year
2013. However, the rating reflects, the company’s diversified client base
and its comfortable financial profile characterized by strong free cash flows
and large cash balances that support a healthy liquidity position. 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 for normal 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 – September 30, 2013
|
Country Name |
Previous Rating (30.06.2013) |
Current Rating (30.09.2013) |
|
India |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
INDIAN ECONOMIC OVERVIEW
India’s current account
deficit narrowed in the quarter ended September as government measures to curb
imports, especially gold, kicked in. The current account deficit, the
excess of a country’s imports of goods and services over exports, narrowed to $
5.2 billion from $ 21 billion in the year ago period, according to provisional
Reserve Bank of India data. Finance Minister P. Chidambaram said the CAD for
the year will be less than $ 60 billion or 3 per cent of GDP and the latest
data suggests the government may achieve the target.
India was ranked 94th
among the world’s most corrupt nations list. Denmark and New Zealand topped as
the cleanest while Somalia emerged as the most corrupt.
India’s services sector
activity witnessed a moderate improvement in November over the previous month,
even while indicating the fifth successive monthly contraction, according the
HSBC survey.
$53 million
estimated losses suffered by India due to phishing attacks during the third
quarter, according to a study by RSA. India ranks fourth in the list of nations
hit by phishing attacks. The US remained at the top of the charts. Phishing is
the process of acquiring information such as user names, passwords and credit
card details by sending e-mails disguised as official mails.
Rs.4080 million
worth of mobile-phone-based transactions by July 2013 compared to Rs.260
million in September, 2012, according to Deloitte report. The number of
transactions has shot up from 94000 to 701000.
India aims to earn
Rs.400000 million from the bandwidth auction set for January. The merger and
acquisition guidelines, cleared by a group of ministers, will be out before the
auction begins so that players can make informed decisions on the auctions.
EXTERNAL AGENCY RATING
|
Rating Agency Name |
ICRA |
|
Rating |
AA- (Fund Based Facilities) |
|
Rating Explanation |
High degree of safety and low credit
risk. |
|
Date |
March 2013 |
|
Rating Agency Name |
ICRA |
|
Rating |
A1+ (Non Fund Based Facilities) |
|
Rating Explanation |
Very strong degree of safety and lowest
credit risk. |
|
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 BY
|
Name : |
Mekala |
|
Designation : |
Accountant |
|
Contact No.: |
91-422-2273723 |
|
Date : |
30.12.2013 |
LOCATIONS
|
Registered Office / Factory 1 / Head Office: |
304-A,
Trichy Road, Singanallur, Coimbatore – 641005, Tamilnadu, India |
|
Tel. No.: |
91-422-2273722
to 34 |
|
Fax No.: |
91-422-2273884
and 85 |
|
E-Mail : |
|
|
Website : |
|
|
Area : |
31653
sq. ft. |
|
Location : |
Owned |
|
|
|
|
Factory 2 : |
B Unit 304-F, Trichy Road, Singallur, Coimbatore – 641005, Tamilnadu, India |
|
Tel. No.: |
91-422-2273722
to 34 |
|
Fax No.: |
91-422-2273886 |
|
Area : |
57524 sq. ft. |
|
|
|
|
Factory 3 : |
C Unit Engineering Division Avanashi Road,
Muthugoundenputhur, Coimbatore – 641406, Tamilnadu, India |
|
Tel. No.: |
91-422-2360687,
2360571, 2360253, 2360254, 2360987 |
|
Fax No.: |
91-422-2360987 |
|
Area : |
1069398
sq. ft. |
|
|
|
|
Factory 4 : |
D Unit S. F. No. 23, K. Krishnapuram, Kamanaickenpalayam,
Palladam , Coimbatore – 641658, Tamilnadu, India. |
|
Tel. No.: |
91-4255-266302,
266772, 266771, 266310 |
|
Area : |
3080782
sq. ft. |
|
|
|
|
Factory 5 : |
FOUNDRY DIVISION Kannampalayam, Sulur Via, Coimbatore-641402, Tamilnadu, India |
|
|
|
|
Regional Offices
and Branches : |
Located At : · New Delhi · Mumbai · Baroda · Bangalore · Madurai · Dindigul · Secunderabad · Chennai · Kolkatta |
DIRECTORS
As on: 31.03.2013
|
Name : |
Mr. M M Murugappan |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Mr. L Ramkumar |
|
Designation : |
Non-Executive Director |
|
|
|
|
Name : |
Mr. C R Swaminathan |
|
Designation : |
Non-Executive Director |
|
|
|
|
Name : |
Mr. J Balamurugan |
|
Designation : |
Non-Executive Director |
|
|
|
|
Name : |
Mr. V Venkiteswaran |
|
Designation : |
Non-Executive Director |
|
|
|
|
Name : |
Dr. Sreeram Srinivasan |
|
Designation : |
President and Executive Director |
KEY EXECUTIVES
|
Name : |
Mekala |
|
Designation : |
Accountant |
|
|
|
|
Name : |
C Subramaniam |
|
Designation : |
Company Secretary |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on: 30.09.2013
|
Category of Shareholders |
No. of Shares |
% of Holdings |
|
(A) Shareholding
of Promoter and Promoter Group |
|
|
|
|
|
|
|
|
57302913 |
70.12 |
|
|
57302913 |
70.12 |
|
|
|
|
|
Total shareholding
of Promoter and Promoter Group (A) |
57302913 |
70.12 |
|
(B) Public
Shareholding |
|
|
|
|
|
|
|
|
13505 |
0.02 |
|
|
6500 |
0.01 |
|
|
2614625 |
3.20 |
|
|
1552000 |
1.90 |
|
|
3000 |
0.00 |
|
|
3000 |
0.00 |
|
|
4189630 |
5.13 |
|
|
|
|
|
|
1193082 |
1.46 |
|
|
|
|
|
|
13495044 |
16.51 |
|
|
4148424 |
5.08 |
|
|
1386760 |
1.70 |
|
|
3000 |
0.00 |
|
|
10000 |
0.01 |
|
|
790342 |
0.97 |
|
|
62503 |
0.08 |
|
|
520122 |
0.64 |
|
|
793 |
0.00 |
|
|
20223310 |
24.75 |
|
Total Public
shareholding (B) |
24412940 |
29.88 |
|
Total (A)+(B) |
81715853 |
100.00 |
|
(C) Shares held by Custodians and against which Depository Receipts have been issued |
0 |
0.00 |
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
Total (A)+(B)+(C) |
81715853 |
0.00 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer of Gears and Gear Products. |
GENERAL INFORMATION
|
No. of Employees : |
581 (Approximately) |
|
|
|
|
Bankers : |
· State Bank of India · ICICI Bank Limited ·
Bank of Nova Scotia |
|
|
|
|
Facilities : |
-- |
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
S.
Lakshminarayanan Associates Chartered Accountants |
|
|
|
|
Entity with
Significant Influence : |
Tube Investments of India Limited (between 3 September, 2012 and 19 November, 2012) |
|
|
|
|
Holding
Company : |
Tube Investments of India Ltd (with effect from 19 November, 2012) |
|
|
|
|
Fellow Subsidiaries
: |
· Cholamandalam MS General Insurance Company Limited · Cholamandalam Investment and Finance Company Limited · Cholamandalam Distribution Services Limited · Cholamandalam Factoring Limited · Cholamandalam Securities Limited · TI Financial Holdings Limited · TICI Motors (Wuxi) Company Limited · Sedis SAS · Societe De Commercialisation De Composants Industriels SARL · Sedis Company Limited |
CAPITAL STRUCTURE
As on: 31.03.2013
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
100000000 |
Equity Shares |
Rs.1/- each |
Rs.100.000 Millions |
|
|
|
|
|
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
81715853 |
Equity Shares |
Rs.1/- each |
Rs.81.700 Millions |
|
|
|
|
|
a) Reconciliation of
Share Capital:
a) Shares outstanding as at 1st April, 2012 and 31 March, 2013 – 81715853
b) Terms / Rights attached to class of shares
The Company has only one class of shares referred to as equity shares having a par value of Rs.1/-.
The holders of equity shares are entitled to one vote per share.
c) Details of Shareholder(s) holding more than 5 Percent of equity shares in the Company as on 31st March, 2013
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2013 |
31.03.2012 |
31.03.2011 |
|
EQUITY AND LIABILITIES |
|
|
|
|
(1)Shareholders' Funds |
|
|
|
|
(a) Share Capital |
81.700 |
81.700 |
81.716 |
|
(b) Reserves & Surplus |
2494.100 |
2396.700 |
2210.415 |
|
(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) |
2575.800 |
2478.400 |
2292.131 |
|
|
|
|
|
|
(3) Non-Current
Liabilities |
|
|
|
|
(a) long-term borrowings |
0.000 |
0.000 |
38.611 |
|
(b) Deferred tax liabilities (Net) |
68.800 |
107.300 |
142.572 |
|
(c) Other long term liabilities |
0.900 |
0.900 |
23.216 |
|
(d) long-term provisions |
1.000 |
3.000 |
3.000 |
|
Total Non-current
Liabilities (3) |
70.700 |
111.200 |
207.399 |
|
|
|
|
|
|
(4) Current Liabilities |
|
|
|
|
(a) Short term borrowings |
0.000 |
0.000 |
0.000 |
|
(b) Trade payables |
34.900 |
15.600 |
39.721 |
|
(c) Other current liabilities |
134.300 |
183.000 |
230.209 |
|
(d) Short-term provisions |
68.000 |
103.700 |
117.830 |
|
Total Current
Liabilities (4) |
237.200 |
302.300 |
387.760 |
|
|
|
|
|
|
TOTAL |
2883.700 |
2891.900 |
2887.290 |
|
|
|
|
|
|
ASSETS |
|
|
|
|
(1) Non-current
assets |
|
|
|
|
(a) Fixed Assets |
|
|
|
|
(i) Tangible assets |
1143.200 |
1376.900 |
1577.812 |
|
(ii) Intangible Assets |
14.300 |
5.200 |
1.348 |
|
(iii) Capital work-in-progress |
36.200 |
55.900 |
75.373 |
|
(iv) Intangible assets under development |
0.000 |
0.000 |
0.000 |
|
(b) Non-current Investments |
0.000 |
0.000 |
0.000 |
|
(c) Deferred tax assets (net) |
0.000 |
0.000 |
0.000 |
|
(d) Long-term Loan and Advances |
30.500 |
23.700 |
23.946 |
|
(e) Other Non-current assets |
0.000 |
0.000 |
0.000 |
|
Total Non-Current
Assets |
1224.200 |
1461.700 |
1678.479 |
|
|
|
|
|
|
(2) Current assets |
|
|
|
|
(a) Current investments |
379.900 |
0.000 |
0.000 |
|
(b) Inventories |
420.300 |
570.000 |
435.430 |
|
(c) Trade receivables |
251.600 |
238.700 |
258.688 |
|
(d) Cash and cash equivalents |
533.100 |
559.300 |
475.568 |
|
(e) Short-term loans and advances |
22.200 |
36.800 |
36.528 |
|
(f) Other current assets |
52.400 |
25.400 |
2.597 |
|
Total Current
Assets |
1659.500 |
1430.200 |
1208.811 |
|
|
|
|
|
|
TOTAL |
2883.700 |
2891.900 |
2887.290 |
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2013 |
31.03.2012 |
31.03.2011 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
1465.300 |
1729.900 |
1623.480 |
|
|
|
Other Income |
76.400 |
49.400 |
28.590 |
|
|
|
TOTAL (A) |
1541.700 |
1779.300 |
1652.070 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Cost of Materials Consumed |
437.100 |
567.700 |
513.156 |
|
|
|
Change in Inventories of Finished Goods and Work in Process |
65.500 |
(47.900) |
11.422 |
|
|
|
Other Direct Manufacturing Expenses |
111.600 |
124.700 |
82.889 |
|
|
|
Employee Benefits Expense |
261.100 |
234.700 |
162.459 |
|
|
|
Other Expenses |
157.100 |
206.900 |
165.764 |
|
|
|
TOTAL (B) |
1032.400 |
1086.100 |
935.690 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
509.300 |
693.200 |
716.380 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
2.900 |
6.200 |
10.309 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
506.400 |
687.000 |
706.071 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
285.700 |
271.000 |
268.461 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
220.700 |
416.000 |
437.610 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
66.000 |
134.700 |
158.995 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
154.700 |
281.300 |
278.615 |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
103.600 |
92.300 |
83.645 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
50.000 |
175.000 |
175.000 |
|
|
|
Dividend |
49.000 |
81.700 |
81.715 |
|
|
|
Tax on Dividend |
8.300 |
13.300 |
13.256 |
|
|
BALANCE CARRIED
TO THE B/S |
151.000 |
103.600 |
92.289 |
|
|
|
|
|
|
|
|
|
|
EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
FOB value of exports |
108.500 |
200.600 |
105.165 |
|
|
TOTAL EARNINGS |
108.500 |
200.600 |
105.165 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Plant & Machinery |
0.000 |
0.000 |
102.687 |
|
|
|
Raw Materials |
5.400 |
8.800 |
4.549 |
|
|
|
Consumable Stores & Tools |
1.900 |
10.600 |
3.510 |
|
|
|
Machinery Spares |
0.900 |
4.800 |
1.862 |
|
|
|
Electrical Spares |
0.000 |
0.000 |
0.082 |
|
|
|
Capital Goods |
0.000 |
1.400 |
0.000 |
|
|
TOTAL IMPORTS |
8.200 |
25.600 |
112.690 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
1.89 |
3.44 |
3.41 |
|
KEY RATIOS
|
PARTICULARS |
|
31.03.2013 |
31.03.2012 |
31.03.2011 |
|
PAT / Total Income |
(%) |
10.03 |
15.81
|
16.86 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
15.06 |
24.04
|
26.96 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
7.75 |
14.67
|
15.56 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.09 |
0.17
|
0.19 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Debt/Networth) |
|
0.00 |
0.00
|
0.02 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
7.00 |
4.73
|
3.12 |
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 |
No |
|
8] |
No. of employees |
Yes |
|
9] |
Name of person contacted |
Yes |
|
10] |
Designation of contact person |
Yes |
|
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 |
No |
|
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 |
DIRECTORS’ PROFILE
Mr. M M Murugappan
Chairman
Mr. M M Murugappan (57 years) holds a Masters degree in Chemical Engineering from the University of Michigan, USA. He is currently the Chairman of Tube Investments of India Limited. He is also on the Board of various companies including Mahindra and Mahindra Limited and Wendt (India) Limited.
Mr. V Venkiteswaran
Non-Executive Director
Mr. V Venkiteswaran (66 years) has business experience of over 40 years in diverse areas of operations. He is a Mechanical Engineer from theUniversity of Madras and worked over 36 years with Tata Tea Limited and retired as Executive Director of Tata Tea Limited.
Mr. C R Swaminathan
Non-Executive Director
Mr. C R Swaminathan (65 years) holds a graduate degree in Agriculture and a Masters degree in Business Administration. He had been associated with the PSG group of institutions as its Chief Executive Officer. Mr. C R Swaminathan is well experienced in the Foundry Industry and is the Past President of the Institute of Indian Foundrymen. He is also the Past President of the Confederation of Indian Industry (Southern Region).
Mr. J Balamurugan
Non-Executive Director
Mr. J Balamurugan (52 years) is an Electronics Engineer from Regional Engineering College, Trichy. He has also done the Management Programme for Entrepreneurial Firms in Indian Institute of Management, Bangalore. He has managing experience in the businesses of IT infrastructure, online services and aftermarket automotive enhancements and others. He was the past Chairman of Confederation of Indian Industry, Coimbatore Zone.
Mr. L Ramkumar
Non-Executive Director
Mr. L Ramkumar (57 years) is a Cost Accountant and has a Post Graduate Diploma in Management from Indian Institute of Management, Ahmedabad. He is currently the Managing Director of Tube Investments of India Limited He has over 33 years of rich and varied experience in management including 21 years in Tube Investments of India Limited
Dr. Sreeram
Srinivasan
President and Executive Director
Dr. Sreeram Srinivasan (50 Years) holds a B.Tech. degree from IIT, Madras and also holds a MS and Ph.D from NC State University, Raleigh, USA. He has over two and a half decades of rich and varied experience, having worked for several leading multinational and Indian companies.
REVIEW OF OPERATIONS
During the year, the Company achieved a turnover of Rs. 1460.000 Millions as against Rs. 1720.000 Millions in the previous year, a decline of 15%. The year 2012-13 was challenging in many respects. The economic growth levels witnessed by the country in the previous years declined and the business sentiment remained largely negative. Poor monsoons, high interest rates, low growth, slowdown in infrastructure projects and overall drop in consumer confidence impacted the economy as a whole and consequently the sales of the Company as well. The Profit Before Tax was at Rs. 220.700 Millions. against Rs. 416.000 Millions. in the previous year. The decline in profit was due to the lower turnover, impact of input cost increases and higher fixed costs. The Company is focusing on enhancing customer base, improving its operational efficiencies and cost management to mitigate the effect of these factors. The benefit of these initiatives is expected to accrue in the current year.
MANAGEMENT DISCUSSION
AND ANALYSIS
Review of business
Industry scenario
The Company is in the business of design, manufacture, supply and servicing of gears and gear boxes. The market size for these products is estimated to be around Rs. 30000.000 Millions. The industry is growing at a rate of about 6% per annum and is expected to touch about Rs. 40000.000 Millions. in the next five years. Within the industry, there are certain segments growing at a faster rate while a few are flat or declining. In the National Market, Steel, Cement, Sugar, Mining, Paper, Marine make up the conventional part of this Industry while off-highway (Construction), Windmill and Metro Rail constitute the relatively newer segments. The Metro and Off-highway segments are expected to grow at almost twice the average of the industry growth while the Windmill segment is not expected to register any growth at all in the next few years. There are five major players and a few regional players in the National market while a significant portion of gearboxes for critical applications are met through imports. Exports presents an opportunity for the Company but is limited at present due to the global economic scenario.
The National gearbox industry also constitutes two major segments, viz., standard and non-standard. Standard gearboxes constitute about 35% of the market and growing approximately at over 10% CAGR while the non-standard (customised) gear boxes constitute over 33% and growing below the Industry average. The remainder of the industry is made up of loose gears and are growing at the Industry level. The industry is witnessing a greater drive towards standardization thanks to the entry of multi-national players.
Industrial growth in general and infrastructure growth in particular present the opportunity for growth of the gears and gearbox industry. Thus, import substitution by local players and overall economic growth would be the drivers for growth in the gear and gearbox industry. The former would however entail acquisition or development of technology from established players in the field. Skilled resources and state of the art facilities are critical success factors in this industry.
REVIEW OF PERFORMANCE
The Company has three focus areas: supply of internals and spares (loose gears), customized non-standard gearboxes and servicing of any make of gearbox. The Company reported a revenue of Rs. 1460.000 Millions. in the year against Rs. 1720.000 Millions. in the previous year. The decline was largely due to the lower demand for gearboxes, predominantly in the infrastructure related industries, significantly lower exports, and lower servicing revenue. The Profit before Tax for the year was also lower at Rs. 220.700 Millions. against Rs. 416.000 Millions. due to the lower turnover, higher input costs mainly on power which could not be recovered from customers and intense competition in the various segments. During the year there were also one-time charges to the Profit & Loss Account due to review and changes of certain accounting policies. This was consequent to the change in the management. The Company has embarked on a program of improving its operational efficiencies and also improving its cost base. These factors helped the Company partly mitigate the impact of the increased costs on the bottom line.
There was also a strong focus on reduction of resources employed in the business both on working capital and on fixed assets. This exercise helped in achieving a significant reduction in inventory holding. The Company generated cash of Rs. 600.000 Millions. from operations and remains debt free. Investments in essential capital expenditure towards enhanced productivity are ongoing.
The Company is focusing on developing a new range of products in the standard segment. These products are expected to provide greater value to customers while enhancing our competitiveness in this segment. Efforts are also on to enhance the range of planetary gear boxes. These gear boxes have made a positive impact on customers and the demand for such products is set to increase.
The Company remains confident that the future is positive given the confidence of its customers on the Company’s products and service and the fact that the government is seized of the need to stimulate growth. Prospects of a better monsoon, lower inflation and reduction in interest rates could spur economic growth during the current financial year.
UNAUDITED FINANCIAL RESULTS FOR THE QUARTER AND HALF YEAR ENDED 30th
SEPTEMBER 2013
(Rs. In Millions)
|
Sr. No. |
Particular |
Quarter Ended |
Six Months Ended |
|
|
|
|
30.09.2013 (Unaudited) |
30.06.2013 (Unaudited) |
30.09.2013 (Unaudited) |
|
1. |
Net Sales/Income
from Operations |
406.400 |
331.900 |
738.300 |
|
|
Other operating
income |
10.500 |
10.900 |
21.400 |
|
|
Total Income |
416.900 |
342.800 |
759.700 |
|
2. |
Expenditure |
|
|
|
|
|
Cost
of materials consumed |
164.700 |
106.100 |
270.800 |
|
|
Purchase
of stock in trade |
0.000 |
0.000 |
0.000 |
|
|
Changes
in inventories of finished goods, work in progress and stock in trade |
(31.400) |
10.300 |
(21.100) |
|
|
Employee
benefits expenses |
87.500 |
74.600 |
162.100 |
|
|
Depreciation
and amortization expenses |
63.700 |
64.000 |
127.700 |
|
|
Other
expenses |
68.700 |
63.000 |
131.700 |
|
|
Total Expenses |
353.200 |
318.000 |
671.200 |
|
3. |
Profit From Operations before
Other Income, Interest and Exceptional Items (1-2) |
63.700 |
24.800 |
88.500 |
|
4. |
Other
Income |
24.400 |
22.600 |
47.000 |
|
5. |
Profit Before Interest and
Exceptional Items (3+4) |
88.100 |
47.400 |
135.500 |
|
6. |
Finance
Costs |
0.000 |
0.000 |
0.000 |
|
7. |
Profit/ (Loss) from
ordinary activities after Finance costs but before Exceptional Items (5-6) |
88.100 |
47.400 |
135.500 |
|
8. |
Exceptional
Items |
- |
- |
- |
|
9. |
Profit from Ordinary
Activities before Tax (7+8) |
88.100 |
47.400 |
135.500 |
|
10. |
Tax
Expense |
20.800 |
13.800 |
34.600 |
|
11. |
Net Profit from Ordinary Activities
after Tax (9-10) |
67.300 |
33.600 |
100.900 |
|
12. |
Extraordinary
Item (net of expense) |
- |
- |
- |
|
13. |
Net Profit for the period
(11-12) |
67.300 |
33.600 |
100.900 |
|
14. |
Paid-up
Equity Share Capital (Face Value of Re. 1/- Each) |
81.700 |
81.700 |
81.700 |
|
15. |
Reserves
Excluding Revaluation Reserve |
|
|
|
|
16. |
Basic and Diluted Earning Per
Share (EPS) (Rs.)-Not Annualised |
|
|
|
|
|
a)
Basic and diluted EPS before extraordinary items |
0.82 |
0.41 |
1.23 |
|
|
b) Basic
and diluted EPS after extraordinary items |
0.82 |
0.41 |
1.23 |
|
|
|
|
|
|
|
17. |
Public Shareholding |
|
|
|
|
|
-Number
of Shares |
24412940 |
24412940 |
24412940 |
|
|
-
Percentage of Shareholding |
29.88% |
29.88% |
29.88% |
|
|
|
|
|
|
|
18. |
Promoters and Promoter Group
Shareholding |
|
|
|
|
|
a) Pledged/Encumbered |
|
|
|
|
|
-
Number of Shares |
NIL |
NIL |
NIL |
|
|
-
Percentage of Shares (as a % of the Total Shareholding of promoter and
promoter group) |
NIL |
NIL |
NIL |
|
|
-
Percentage of Shares (as a % of the Total Share Capital of the Company) |
NIL |
NIL |
NIL |
|
|
|
|
|
|
|
|
b) Non Encumbered |
|
|
|
|
|
-
Number of Shares |
57302913 |
57302913 |
57302913 |
|
|
- Percentage
of Shares (as a % of the Total Shareholding of Promoter and Promoter Group) |
100% |
100% |
100% |
|
|
-
Percentage of Shares (as a % of the Total Share Capital of the Company) |
70.12% |
70.12% |
70.12% |
|
Particulars |
Quarter Ended 30.09.2013 |
|
Pending at the beginning of the quarter |
NIL |
|
Received during the quarter |
1 |
|
Disposed of during the quarter |
1 |
|
Remaining unresolved at the end of the
quarter |
NIL |
STANDALONE STATEMENT
OF ASSETS AND LIABILITIES
(Rs. In Millions)
|
PARTICULARS |
30.09.2012 Unaudited |
|
Equity and liabilities |
|
|
Shareholders' fund |
|
|
Share capital |
81.700 |
|
Reserve & surplus |
2595.000 |
|
Sub-total
- Shareholders' funds |
2676.700 |
|
Non - current liabilities |
|
|
Long term borrowings |
0.000 |
|
Deferred tax liability (net) |
45.700 |
|
Other long term liabilities |
0.900 |
|
Long Term Provision |
1.000 |
|
Sub-total
– Non-current liabilities |
47.600 |
|
Current liabilities |
|
|
Short term borrowings |
0.000 |
|
Trade payables |
75.000 |
|
Other current liabilities |
206.000 |
|
Short term provisions |
9.400 |
|
Sub-total
– Current liabilities |
290.400 |
|
|
|
|
Total –
Equity & Liabilities |
3014.700 |
|
|
|
|
Assets |
|
|
Non-current assets |
|
|
Fixed assets |
1074.500 |
|
Long term loans & advances |
38.500 |
|
Sub-total
– Non-current Assets |
1113.000 |
|
Current
assets |
|
|
Current Investment |
600.400 |
|
Inventories |
432.000 |
|
Trade receivables |
251.500 |
|
Cash & bank balances |
545.000 |
|
Short term loans & advances |
30.200 |
|
Other Current Assets |
42.600 |
|
Sub-total
- Current Assets |
1901.700 |
|
|
|
|
Total –
Assets |
3014.700 |
Notes
1 The above Financial Results were reviewed by the Audit Committee and approved by the Board of Directors of the Company at the meeting held on 23rd October, 2013.
2 The Statutory Auditors of the Company have carried out a Limited Review of the above Financial Results.
3 The Company's main business is "Manufacture of Gears and Gear Products "There are no separate reportable segments as per Accounting Standard 17 (AS17)
4 The above financial results are also available on our website www.shanthigears.corn
5 Previous period figures have been regrouped, wherever necessary
FIXED ASSETS
Tangible Assets
· Land
· Buildings
· Plant and Machinery
· Furniture and Fittings
· Office Equipments
· Vehicles
Intangible Assets
· Computer Software
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No exist to suggest that subject is or was
the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No available
information exist that suggest that subject or any of its principals have been
formally charged or convicted by a competent governmental authority for any
financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on Corporate
Governance to identify management and governance. These factors often have been
predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.61.93 |
|
|
1 |
Rs.102.39 |
|
Euro |
1 |
Rs.85.12 |
INFORMATION DETAILS
|
Information Gathered
by : |
HTL |
|
|
|
|
Report Prepared
by : |
VRN |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
NO |
|
--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 |
|
63 |
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.