MIRA INFORM REPORT
|
Report Date : |
10.06.2014 |
IDENTIFICATION DETAILS
|
Name : |
MAHINDRA SANYO SPECIAL STEEL PRIVATE LIMITED (w.e.f. 18.09.2012) |
|
|
|
|
Formerly Known
As : |
NAVYUG SPECIAL STEEL PRIVATE LIMITED |
|
|
|
|
Registered
Office : |
74, Ganesh Apartment, L.J. Road, Opposite Sitaladevi Temple, Mahim
(West), Mumbai – 400016, Maharashtra |
|
|
|
|
Country : |
India |
|
|
|
|
Financials (as
on) : |
31.03.2013 |
|
|
|
|
Date of
Incorporation : |
08.11.2011 |
|
|
|
|
Com. Reg. No.: |
11-223696 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs.100.000 Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
U27310MH2011PTC223696 |
|
|
|
|
TAN No.: [Tax Deduction &
Collection Account No.] |
MUMN19358D |
|
|
|
|
PAN No.: [Permanent Account No.] |
AADCN7895E |
|
|
|
|
Legal Form : |
Private Limited Liability Company |
|
|
|
|
Line of Business
: |
Manufacturer and Exporter of Alloy Steel. |
|
|
|
|
No. of Employees
: |
Information denied by the management. |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba (48) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
Maximum Credit Limit : |
USD 12970000 |
|
|
|
|
Status : |
Satisfactory |
|
|
|
|
Payment Behaviour : |
Usually Correct |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is a part of “Mahindra and Mahindra Limited’. It is a relatively new company having satisfactory track. The company has
incurred loss from its first year of business operations during 2013.
However, the liquidity and financial profile has improved marked by net
equity infusion by the management. Trade relations are fair. Business is active. Payment terms are
reported as usually correct. In view of strong support from its group company and other affiliates,
the subject 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.
INDIAN ECONOMIC OVERVIEW
US investment bank
Goldman Sachs has upgraded its outlook on Indian markets as it expects
positive impact of the election cycle.
India’s economy may
grow 4.7 % in the current financial year, lower than the official estimate of
4.9 %, Fitch Rating said. The global rating agency expects the economy to pick
up in the next two financial years.
Global ratings
agency Standard & Poor said increasing focus by India Inc on lowering debt
is likely to improve their credit profiles.
Singapore (1.1
million Indian tourists in 2012), Thailand (one million), the United Arab
Emirates ().98 million) and Malaysia ().82 million) emerged as the preferred
holidays hotspots for Indians. The total figure is expected to increase to 1.93
million by 2017, according to the latest Eurmonitor international report.
There is a $29.34 bn
outward foreign direct investment by domestic companies between April and
January of 2013/14 which has seen some signs of recovery according to a Care
Ratings report.
There are 264 number
of new companies being set up every day on average during 2014. Most of them
are registered in Mumbai. India had 1.38 million registered companies at the
end of January, 2014.
Twitter like
messaging service Weibo Corporation has filed to raise $ 500 million via a US
initial public offering. Alibaba, which owns a stake in Weibo is expected to
raise about $ 15 billion New York this year in the highest profile Internet IPO
since Facebook’s in 2012.
Bharti Airtel has
raised Rs.2,453.2 crore (350 million Swiss Francs) by selling six-year bonds at
a coupon rate of three per cent and maturing in 2020. This is the largest ever
bond offering by an Indian company in Swiss Francs. Bharat Petroleum
Corporation raised 175 million Swiss Francs by selling five year bonds at 2.98
% coupon rate in February.
Indian Oil
Corporation plans to invest Rs 7650 crore in setting up a petrochemical complex
at its almost complete Paradip refinery in Odhisha in three to four years. The
company board is set to consider the setting up of a 700000 tonne per annum
polypropylene plant at an estimated cost at Rs.3150 crore.
Global chief information
officers at gathering in Bangalore in April to meet Indian startups at an event
called Tech50 Watchout for Little Eye Labs-Facebook type deals in the making.
EXTERNAL AGENCY RATING
|
Rating Agency Name |
India Ratings And Research |
|
Rating |
BBB [Long Term] |
|
Rating Explanation |
Moderate degree of safety and moderate
credit risk. |
|
Date |
21.02.2013 |
|
Rating Agency Name |
India Ratings And Research |
|
Rating |
A2 [Non Fund Based Working Capital Limits] |
|
Rating Explanation |
Strong degree of safety and low credit risk.
|
|
Date |
21.02.2013 |
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 DECLINED BY
|
Name : |
Mr. Sunil Shetty |
|
Designation : |
Finance Department |
|
Contact No.: |
91-2192-263070 |
|
Date : |
07.06.2014 |
LOCATIONS
|
Registered Office : |
74, Ganesh Apartment, L.J. Road, Opposite Sitaladevi Temple, Mahim
(West), Mumbai – 400016, Maharashtra, India |
|
Tel. No.: |
91-22-24444287 |
|
Fax No.: |
91-22-24458196 |
|
E-Mail : |
|
|
Website : |
|
|
|
|
|
Factory/ Administrative Office
: |
MUSCO, Jagdish Nagar, Khopoli, Raigad
- 410216, Maharashtra, India |
|
Tel. No.: |
91-2192-260500/ 528/ 263318/ 263347 |
|
Fax No.: |
91-2192-263076/ 263073 |
DIRECTORS
AS ON 22.07.2013
|
Name : |
Mr. Hemant Hansraj Luthra |
|
Designation : |
Chairman cum Managing Director |
|
Address : |
Flat No. 6, 68 Breach Candy Garden, Bhulabai Desai Road,
Mumbai-400026, Maharashtra, India |
|
Date of Birth/Age : |
18.04.1949 |
|
Date of Appointment : |
10.07.2012 |
|
Din No.: |
00231420 |
|
|
|
|
Name : |
Mr. Uday Subrata Gupta |
|
Designation : |
Managing Director |
|
Address : |
D-40, Terrace Duplex, The Woods Kale Wadi Road, Waked Aundh Annexe,
Pune-411057, Maharashtra, India |
|
Date of Birth/Age : |
13.11.1958 |
|
Date of Appointment : |
11.11.2011 |
|
Din No.: |
03514282 |
|
|
|
|
Name : |
Mr. Sanjay Vasant Joglekar |
|
Designation : |
Director |
|
Address : |
25, Shefale B-Makarand, Sahniwas Veer Savarkar Marg, Mahim (West),
Mumbai-400016, Maharashtra, India |
|
Date of Birth/Age : |
09.10.1955 |
|
Date of Appointment : |
11.11.2011 |
|
Din No.: |
00209394 |
|
|
|
|
Name : |
Mr. Daljit Lilaram Mirchandani |
|
Designation : |
Director |
|
Address : |
101, Sindhi Society Aundh, Pune-411007, Maharashtra, India |
|
Date of Birth/Age : |
26.10.1947 |
|
Date of Appointment : |
10.08.2012 |
|
Din No.: |
00022951 |
|
|
|
|
Name : |
Yutaka Takeshi Tsukamoto |
|
Designation : |
Director |
|
Address : |
3-25-5, Hakuchouda, Himeji-Shi, Hyogo, Pin Code 6712245, Japan |
|
Date of Birth/Age : |
25.02.1949 |
|
Date of Appointment : |
05.09.2012 |
|
Din No.: |
06367350 |
|
|
|
|
Name : |
Nobuyuki Takumi Tanaka |
|
Designation : |
Director |
|
Address : |
109, Sugoudani, Himeji-Shi, Hyogo, Pin Code 6712243, Japan |
|
Date of Birth/Age : |
08.10.1948 |
|
Date of Appointment : |
05.09.2012 |
|
Din No.: |
06367343 |
|
|
|
|
Name : |
Shinichi Takeo Hori |
|
Designation : |
Director |
|
Address : |
6-31-707, Akasaka 8, Chome, , Tokyo, Pin Code 1070052, Japan |
|
Date of Birth/Age : |
05.08.1963 |
|
Date of Appointment : |
02.05.2013 |
|
Din No.: |
06529863 |
KEY EXECUTIVES
|
Name : |
Mr. Pradeep Shekara Salian |
|
Designation : |
Secretary |
|
Address : |
N 6/7, Ganpati Nivas, Bangur Nagar, Goregaon (West), Mumbai-400090,
Maharashtra, India |
|
Date of Birth/Age : |
01.06.1964 |
|
Date of Appointment : |
03.08.2012 |
|
Pan No.: |
AHAPS0593F |
|
|
|
|
Name : |
Mr. Saurabh Mehta |
|
Designation : |
Finance Head Department |
|
|
|
|
Name : |
Mr. Sunil Shetty |
|
Designation : |
Finance Department |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
AS ON 22.07.2013
|
Names of Shareholders |
|
No. of Shares |
|
Mahindra Ugine Steel Company Limited, India |
|
5100000 |
|
Sanyo Special Steel Company Limited, Japan |
|
2900000 |
|
Mitsui and Company Limited, Japan |
|
2000000 |
|
|
|
|
|
TOTAL
|
|
10000000 |
AS ON 22.07.2013
|
Equity Share Breakup Category |
|
% of Holding |
|
Foreign holdings [Foreign institutional investors, Foreign Companies, Foreign Financial Institutions, Non-resident Indian or Overseas corporate bodies or others] |
|
49.00 |
|
Bodies
corporate |
|
51.00 |
|
TOTAL |
|
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer and Exporter of Alloy Steel. |
GENERAL INFORMATION
|
No. of Employees : |
Information denied by the management. |
||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||
|
Bankers : |
State Bank of India, Commercial Branch, N.G.N Vaidya Marg, Fort, Mumbai - 400023, Maharashtra, India |
||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||
|
Facilities : |
|
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
Deloitte, Haskins and Sells Chartered Accountants |
|
Address : |
12, Dr. Annie Beasant Road, Opposite Shiv Sagar Estate, Worli, Mumbai – 400018, Maharashtra, India |
|
PAN No: |
AACFD4815A |
|
|
|
|
Ultimate Holding Company : |
Mahindra And
Mahindra Limited [L65990MH1945PLC004558] |
|
|
|
|
Holding Company : |
Mahindra Ugine
Steel Company Limited [L99999MH1962PLC012542] |
|
|
|
|
Fellow Subsidiaries : |
·
Mahindra Forgings Limited [L27100MH1999PLC121285] ·
Mahindra Intertrade Limited
[U51900MH1978PLC020222] |
|
|
|
|
Other Related Parties : |
·
Sanyo Special Steel Company Limited ·
Mitsui and Company Limited ·
Mahindra Gears and Transmissions Private Limited ·
Mahindra Hinoday Industries Limited ·
Metal Castello S.P.A, Italy ·
Mahindra Logistics Limited
[U63000MH2007PLC173466] |
CAPITAL STRUCTURE
AS ON 31.03.2013
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
10000000 |
Equity Shares |
Rs.10/- each |
Rs.100.000 Millions |
|
|
|
|
|
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
10000000 |
Equity Shares |
Rs.10/- each |
Rs.100.000 Millions |
|
|
|
|
|
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES
OF FUNDS |
|
31.03.2013 |
31.03.2012 |
|
I.
EQUITY AND LIABILITIES |
|
|
|
|
(1)Shareholders' Funds |
|
|
|
|
(a) Share Capital |
|
100.000 |
0.100 |
|
(b) Reserves & Surplus |
|
3143.881 |
(0.057) |
|
(c) Money
received against share warrants |
|
0.000 |
0.000 |
|
|
|
|
|
|
(2)
Share Application money pending allotment |
|
0.000 |
0.000 |
|
Total Shareholders’ Funds (1) + (2) |
|
3243.881 |
0.043 |
|
|
|
|
|
|
(3)
Non-Current Liabilities |
|
|
|
|
(a)
long-term borrowings |
|
742.716 |
0.000 |
|
(b) Deferred tax
liabilities (Net) |
|
0.000 |
0.000 |
|
(c)
Other long term liabilities |
|
50.000 |
0.000 |
|
(d)
long-term provisions |
|
46.934 |
0.000 |
|
Total
Non-current Liabilities (3) |
|
839.650 |
0.000 |
|
|
|
|
|
|
(4) Current Liabilities |
|
|
|
|
(a)
Short term borrowings |
|
218.547 |
0.000 |
|
(b)
Trade payables |
|
1623.126 |
0.050 |
|
(c)
Other current liabilities |
|
149.865 |
0.017 |
|
(d)
Short-term provisions |
|
14.979 |
0.000 |
|
Total
Current Liabilities (4) |
|
2006.517 |
0.067 |
|
|
|
|
|
|
TOTAL |
|
6090.048 |
0.110 |
|
|
|
|
|
|
II.
ASSETS |
|
|
|
|
(1) Non-current assets |
|
|
|
|
(a)
Fixed Assets |
|
|
|
|
(i)
Tangible assets |
|
1979.065 |
0.000 |
|
(ii)
Intangible Assets |
|
0.000 |
0.000 |
|
(iii)
Capital work-in-progress |
|
18.683 |
0.000 |
|
(iv) Intangible assets under
development |
|
0.000 |
0.000 |
|
(b)
Non-current Investments |
|
140.000 |
0.000 |
|
(c)
Deferred tax assets (net) |
|
0.000 |
0.000 |
|
(d) Long-term Loan and Advances |
|
18.516 |
0.000 |
|
(e)
Other Non-current assets |
|
0.000 |
0.000 |
|
Total
Non-Current Assets |
|
2156.264 |
0.000 |
|
|
|
|
|
|
(2) Current assets |
|
|
|
|
(a)
Current investments |
|
0.000 |
0.000 |
|
(b)
Inventories |
|
1399.396 |
0.000 |
|
(c)
Trade receivables |
|
1634.545 |
0.000 |
|
(d)
Cash and cash equivalents |
|
767.811 |
0.110 |
|
(e)
Short-term loans and advances |
|
120.091 |
0.000 |
|
(f)
Other current assets |
|
11.941 |
0.000 |
|
Total
Current Assets |
|
3933.784 |
0.110 |
|
|
|
|
|
|
TOTAL |
|
6090.048 |
0.110 |
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
|
31.03.2013 |
31.03.2012 |
|
|
|
|
|
|
|
|
|
|
GROSS INCOME |
|
5911.883 |
0.000 |
|
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
TOTAL |
|
NA |
NA |
|
|
|
|
|
|
|
|
Less |
PROFIT
/ (LOSS) BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION |
|
(235.499) |
(0.057) |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES |
|
130.291 |
0.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT
/ (LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION |
|
(365.790) |
(0.057) |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION |
|
149.829 |
0.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT / (LOSS)
BEFORE TAX |
|
(515.619) |
(0.057) |
|
|
|
|
|
|
|
|
|
Less |
TAX |
|
(135.349) |
0.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT / (LOSS)
AFTER TAX |
|
(380.270) |
(0.057) |
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
|
0.000 |
0.000 |
|
|
|
|
|
|
|
|
|
|
BALANCE CARRIED
TO THE B/S |
|
(380.270) |
(0.057) |
|
|
|
|
|
|
|
|
|
|
Earnings /
(Loss) Per Share (Rs.) |
|
(38.03) |
(5.70) |
|
KEY RATIOS
|
PARTICULARS |
|
|
31.03.2013 |
31.03.2012 |
|
Return on Total Assets (PBT/Total Assets} |
(%) |
|
(8.69) |
(51.82) |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
|
(0.15) |
(1.33) |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Debt/Networth) |
|
|
0.30 |
0.00 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
|
1.96 |
1.64 |
FINANCIAL ANALYSIS
[all figures are
in Rupees Millions]
DEBT EQUITY RATIO
|
Particular |
|
31.03.2012 |
31.03.2013 |
|
|
|
Rs.
In Millions |
Rs.
In Millions |
|
Share Capital |
|
0.100 |
100.000 |
|
Reserves & Surplus |
|
(0.057) |
3143.881 |
|
Net
worth |
|
0.043 |
3243.881 |
|
|
|
|
|
|
long-term borrowings |
|
0.000 |
742.716 |
|
Short term borrowings |
|
0.000 |
218.547 |
|
Total
borrowings |
|
0.000 |
961.263 |
|
Debt/Equity
ratio |
|
0.000 |
0.296 |
LOCAL AGENCY FURTHER INFORMATION
DETAILS OF CURRENT MATURITIES OF LONG TERM
DEBT:
|
Particulars |
31.03.2013 [Rs. in millions] |
31.03.2012 [Rs. in millions] |
|
|
|
|
|
Current
Maturities of Long Term Debt |
110.938 |
0.000 |
|
Sr. No. |
Check List by
Info Agents |
Available in
Report (Yes / No) |
|
1] |
Year of Establishment |
Yes |
|
2] |
Locality of the firm |
Yes |
|
3] |
Constitutions of the firm |
Yes |
|
4] |
Premises details |
No |
|
5] |
Type of Business |
Yes |
|
6] |
Line of Business |
Yes |
|
7] |
Promoter's background |
Yes |
|
8] |
No. of employees |
No |
|
9] |
Name of person contacted |
Yes |
|
10] |
Designation of contact person |
Yes |
|
11] |
Turnover of firm for last two years |
Yes |
|
12] |
Profitability for last two years |
Yes |
|
13] |
Reasons for variation <> 20% |
-- |
|
14] |
Estimation for coming financial year |
No |
|
15] |
Capital in the business |
Yes |
|
16] |
Details of sister concerns |
Yes |
|
17] |
Major suppliers |
No |
|
18] |
Major customers |
No |
|
19] |
Payments terms |
No |
|
20] |
Export / Import details (if applicable) |
No |
|
21] |
Market information |
-- |
|
22] |
Litigations that the firm / promoter involved in |
-- |
|
23] |
Banking Details |
Yes |
|
24] |
Banking facility details |
Yes |
|
25] |
Conduct of the banking account |
-- |
|
26] |
Buyer visit details |
-- |
|
27] |
Financials, if provided |
Yes |
|
28] |
Incorporation details, if applicable |
Yes |
|
29] |
Last accounts filed at ROC |
Yes |
|
30] |
Major Shareholders, if available |
Yes |
|
31] |
PAN of Proprietor/Partner/Director, if available |
No |
|
32] |
Date
of Birth of Proprietor/Partner/Director, if available |
Yes |
|
33] |
Voter ID No of Proprietor/Partner/Director, if available |
No |
|
34] |
External Agency Rating, if available |
Yes |
INDEX OF CHARGES:
|
S. No. |
Charge ID |
Date of Charge Creation/Modification |
Charge amount
secured |
Charge Holder |
Address |
Service Request
Number (SRN) |
|
1 |
10424103 |
05/07/2013 * |
3,729,800,000.00 |
State Bank of
India |
COMMERCIAL BRANCH,
N.G.N. VAIDYA MARG,, FORT, MUMBAI - 400001, MAHARASHTRA, INDIA |
B80723299 |
|
2 |
10400399 |
09/01/2013 |
179,800,000.00 |
DENA BANK |
INDUSTRIAL
FINANCE BRANCH, HORIMAN CIRCLE, FORT, MUMBAI - 400023, MAHARASHTRA, INDIA |
B66482878 |
|
3 |
10370111 |
16/08/2012 |
2,850,000,000.00 |
State Bank of
India |
COMMERCIAL BANK,
N.G.N.VAIDYA MARG, FORT, MUMBAI - 400023, MAHARASHTRA, INDIA |
B45533650 |
|
4 |
10368208 |
04/07/2012 |
700,000,000.00 |
BANK OF INDIA |
ANDHERI LARGE CORPORATE
BRANCH, M.D.I. BUILDING, |
B44743292 |
|
* Date of charge modification |
||||||
NOTE:
The Registered Office of the company has been shifted from 101-104, Banaji
House, First Floor, Flora Fountain, Fort, Mumbai – 400001, Maharashtra,
India to the present address w.e.f. 11.11.2011.
PERFORMANCE:
Pursuant to the
Business Transfer Agreement entered into by the Company with Mahindra Ugine
Steel Company Limited (MUSCO), the Steel including Ring business has been
acquired by the Company on slump sale basis as a going concern with effect from
closing hours of 9th July, 2012. The manufacturing activity by the Company has
been started with effect from 10th July, 2012.
Sanyo Special
Steel Company Limited, (Sanyo) and Mitsui and Company Limited (Mitsui), have
invested in the equity of the Company. The Company expects to receive the
technical expertise from the Sanyo and marketing expertise and support from
Mitsui. The details on this matter is mentioned elsewhere below in this Report.
MUSCO, Sanyo, Mitsui will utilize their respective brands, technologies and
networks in order to meet the customer’s needs, of the Steel Business, through
the joint venture.
During the year,
the Steel business felt the impact of slowdown in the overall economy of India
and continuing margin contraction led by price pressure from customers coupled
with increase in input cost. Due to slide in alloy steel demand there was intense
competitive pressure on pricing in special alloy steel market. Pursuant to the
power supply agreement with Wardha Power Company Limited (WPCL), the Company
started receiving lower cost power from WPCL and the saving in the cost of
power was around 10-12%. Management will continue to undertake initiatives for
increasing margin by way of further improvements in operating efficiencies and
increase coverage of metallic surcharge mechanism with customers for mitigating
input price volatility. The Company also foresees significant increase in sales
mainly in the value added segments as process/quality audits by many global
MNCs are expected to fructify into sales in the near future.
During the year,
the Company sold 78,706 tonnes of alloy steel products from the date of
starting the operation i.e. with effect from 10th July, 2012. The Company
registered sales revenue of Alloy and Steel products aggregating Rs.5451.223
Millions for the year. The Company has incurred a loss of Rs. 380.270 Millions
during the year. The Company also registered sales of 2547 tonnes of Ring
(Bearing Races) products for a value of Rs. 3,571.00 lakhs during the year.
PRESS RELEASE
MAHINDRA UGINE FORMS VENTURE WITH SANYO STEEL
MUMBAI, SEPT. 6:
Mahindra Ugine Steel
Company Ltd (MUSCO) has formed a new joint venture company, Mahindra Sanyo
Special Steel Private Ltd, following the financial closure of its joint
venture.
The company has completed
the financial closure of the 51:49 joint venture with Sanyo Special Steel Co
Ltd and Mitsui & Co Ltd.
PROFITABLE VENTURE
“This new venture will
help the company emerge as one of the most profitable, high quality speciality
steel producers in the coming years,” said Anand Mahindra, Chairman and
Managing Director, Mahindra Group.
MUSCO had approved the
slump sale of its steel business into its 100 per cent owned subsidiary Navyug
Special Steel Private Ltd (Navyug Steel) in November last year.
Sanyo has infused about Rs
129 crore for its 29 per cent stake, while Mitsui paid about Rs 89 crore for
its 20 per cent stake in Navyug Steel, the joint venture company. MUSCO holds
the balance 51 per cent of equity in the joint venture.
With financial, technical
and operational inputs from Sanyo Special Steel and Mitsui, the joint venture
expects to enhance its current production from the existing level of 120,000
tonnes a year.
VALUE CHAIN
“Over the last 18 months
working with Mitsui and Sanyo, we have developed a common vision of the future
of our joint venture that leverages the strengths of all three partners. It
gives us the opportunity to move up the value chain while addressing the
growing needs of the Indian market for speciality steels,” said Hemant Luthra,
Chairman, Mahindra Sanyo Special Steel.
MITSUI AND SANYO STEEL BUY 49% IN MAHINDRA UGINE’S STEEL BUSINESS
Sep 7, 2012
MUMBAI: Mitsui and Sanyo Special
Steel have together bought
49% in Mahindra Ugine Steel Company's (MUSCO) wholly-owned steel business for
Rs 218 crore. This is likely to be the first step towards a larger alliance
involving Mitsui and Mahindra Systech, the holding firm for the slew of 16
component businesses in Mahindra & Mahindra Group.
In the transaction on Thursday,
Sanyo invested Rs 129 crore for its 29% stake, while Mitsui paid approximately
Rs 89 crore for its 20% stake in Navyug Steel,
the MUSCO subsidiary.
MUSCO will hold the balance 51%
in the JV. The new joint venture company will be called Mahindra Sanyo Special
Steel. MUSCO has been scouting for a technology partner for about four years
now.
The talks with Severstal, the
Russian steelmaker, initially and later with French steelmaker Ascometal did
not yield anything. That's when the Japanese duo came into the picture last
year.
Sanyo Steel is said to have had
reservations on the stamping business, which they didn't want in the special
steel's joint venture. MUSCO, therefore, decided to approve the slump sale of
its steel business into its 100%-owned subsidiary, Navyug Special Steel (Navyug Steel) in November 2011, in
which the Japanese duo picked up stake.
Mahindra Systech is said to be in talks with a leading European
component maker and it is likely that they will be joined by Mitsui, the global
trading giant. Hemant Luthra, chairman, Mahindra Sanyo declined to comment, but
said: "If any opportunity comes, we'll make the first call to
Mitsui."
"This JV will create a
strong value proposition and enable MUSCO to leverage on Sanyo's technical
expertise and Mitsui's international footprint. This new venture will help the
company to emerge as one of the most profitable, high-quality specialty steel
producers in the coming years," said Anand Mahindra,
chairman and managing director, Mahindra Group.
"We would try our best to
make Mahindra Sanyo Special Steel a successful entity by unlocking the value of
this company ," said Y Takeda, president and representative director,
Sanyo Special Steel.
"With this additional
platform, I am confident our relations will flourish and we will continue to
seek new areas of co-operation," said M Takahashi, executive managing
officer, Iron & Steel Products Business Unit, Mitsui & Co.
Mitsui tasted success in India
when it exited from Sesa Goa in favour of Vedanta Resources and making windfall returns in the
process. Luthra, who also heads Mahindra Systech, had late last year told ET of
the intent, based on the feedback from both customers and investors, and
subject to board approval to create one Systech by merging all companies into
Mahindra Forgings, which is a listed entity.
"We have put teams together.
We are talking to respective private equity players (of component firms) to get
their consent to exchange their stakes in different entities for a stake in
Systech," Luthra had said then. Ernst & Young has been hired by the
firm to value the businesses.
Systech, since its inception in
2004, has made substantial acquisitions across Germany, which includes
component firms such as GSA, Jeco, Falkenroth, Schoneweiss, Stokes in UK,
Metalcastello in Italy and Hinoday, Amforge and SAR Transmissions in India. It
has 24 manufacturing plants in Europe and India with around 12,000 employees.
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 records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals have
been formally charged or convicted by a competent governmental authority for
any financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.59.06 |
|
|
1 |
Rs.99.35 |
|
Euro |
1 |
Rs.80.62 |
INFORMATION DETAILS
|
Information
Gathered by : |
PRT |
|
|
|
|
Analysis Done by
: |
SUB |
|
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Report Prepared
by : |
NKT |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
5 |
|
PAID-UP CAPITAL |
1~10 |
6 |
|
OPERATING SCALE |
1~10 |
5 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
6 |
|
--PROFITABILIRY |
1~10 |
4 |
|
--LIQUIDITY |
1~10 |
6 |
|
--LEVERAGE |
1~10 |
5 |
|
--RESERVES |
1~10 |
6 |
|
--CREDIT LINES |
1~10 |
5 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
NO |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
NO |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
--RBI |
YES/NO |
NO |
|
--EPF |
YES/NO |
NO |
|
|
|
|
|
TOTAL |
|
48 |
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.