MIRA INFORM REPORT

 

 

Report Date :

27.06.2014

 

IDENTIFICATION DETAILS

 

Name :

ESSAR STEEL INDIA LIMITED (w.e.f.18.01.2012)

 

 

Formerly Known As :

ESSAR STEEL LIMITED

 

 

Registered Office :

27Km., Surat Hazira Road, Hazira, Surat – 394 270, Gujarat

 

 

Country :

India

 

 

Financials (as on) :

31.03.2013

 

 

Date of Incorporation :

01.06.1976

 

 

Com. Reg. No.:

04-013787

 

 

Capital Investment / Paid-up Capital :

Rs.28418.000 Millions

 

 

CIN No.:

[Company Identification No.]

U27100GJ1976FLC013787

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

SRTE00025E

 

 

PAN No.:

[Permanent Account No.]

AAACE1741P

 

 

Legal Form :

A Closely Held Public Limited Liability Company

 

 

Line of Business :

Manufacturing and Selling of Steel Products.

 

 

No. of Employees :

Not Divulged

 

 

RATING & COMMENTS

 

MIRA’s Rating :

B (29)

 

RATING

STATUS

PROPOSED CREDIT LINE

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

Small

 

Status :

Moderate

 

 

Payment Behaviour :

Slow

 

 

Litigation :

Exist

 

 

Comments :

Subject is a part of “Essar Group”.

 

It is an established company having moderate track record.

 

The company possesses a weak financial profile marked by consecutive losses which has further deteriorated the position of reserves during 2013.

 

The rating take into consideration the liquidity pressures faced due to extraneous challenges impacting in running of steel plant. However, the infusion of funds from the part of promoters has slightly eased the liquidity position and in turn has nurtured the gradual improvement in its ongoing financing exercise.

 

Trade relations are fair. Business is active. Payment terms are reported as slow.

 

In view of support from its group company, the subject can be considered for business dealings with great caution.

 

NOTES:

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

 

 

INDIAN ECONOMIC OVERVIEW

 

N E W S

 

The economy grew 4.7 %in 2013/14, marking a second straight year of sub-5 % growth – the worst slowdown in more than a quarter of a century. The data was below an official estimate of 4.9 % annual growth and compared with 4.5 % in the last fiscal year. However, the current account deficit narrowed sharply to $ 32.4 billion at 1.7 % of gross domestic product, in 2013/14 from a record high of $ 98.8 billion or 4.7 %, the year before.A sharp fall in gold imports due to restrictions on overseas purchases and muted import of capital goods helped shrink the current account deficit.

 

Online retailer Flipkart has acquired fashion portal Myntra as it prepares to battle with the rapidly expanding India arm of the global e-commerce giant Amazon. The company raised $ 210 million from Russian Investment firm DST Global which has also invested in companies like Facebook, Twitter and Alibaba Group.

 

General Motors will start exporting vehicles from its Talegaon plant near Pune in the second half of 2014. GM was one of the few global carmakers that was using its India plant only for the domestic market.

 

Google has overtaken Apple as the world’s top brand in terms of value, according to global market research agency Millward Brown. Google’s brand value shot up 40 % in a year to $ 158.84 billion. The top 10 of the 100 slots were dominated by US companies.

 

Infosys lost another heavy weight when B G Srinivas, a board member put in his papers. He is the third CEO-hopeful to quit after Chairman N R Narayana Murthy’s return to the company – Ashok Vemuri and V Balakrishnan being the other two.While Vemuri went on to lead IGate, Balakrishnan joined politics.

 

Naresh Goyal – promoted Jet Airways posted biggest quarterly loss – Rs 2153.37 crore – in the three months ended March 31, mainly because it has been offering discounts to passengers to fill planes.

 

William S Pinckney – Chairman and CEO of Amway India was arrested by the Andhra Pradesh Police in connection with a complaint against the direct selling firm. This is the second time that he has been taken into custody. A year, ago the Kerala Police had arrested Pinckney and two company directors on charges of financial irregularities.

 

China has told its state-owned enterprises to sever links with American consulting firms after the United States charged five Chinese military officers wih hacking US companies. China’s action which targets consultancies like McKinsey & Co. and the Boston Consulting Group, sterns from fears that the first are providing trade secrets to the US governments.

 

India has emerged as a country with some of the highest unregistered businesses in the world. Indonesia has the maximum number of shadow businesses, says a study of 68 countries by Imperial College Business School in London.

 

Pfizer has abandoned its attempt to buy AstraZeneca for nearly $ 118 billion after the latter refused an offer of 55 pounds a share.

 

EXTERNAL AGENCY RATING

 

Rating Agency Name

CARE

Rating

Long Term Bank Facilities = C

Rating Explanation

Have very high risk of default.

Date

24.10.2013

 

 

RBI DEFAULTERS’ LIST STATUS

 

Subject’s name is not enlisted as a defaulter in the publicly available RBI Defaulters’ list.

 

 

EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS

 

Subject’s name is not enlisted as a defaulter in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of 31-03-2012.

 

 

INFORMATION DENIED

 

Management Non Co-operative (91-22-67335000)

 

 

LOCATIONS

 

Registered Office/ Plant 1  :

27Km., Surat Hazira Road, Hazira, Surat – 394270, Gujarat, India

Tel. No.:

91-261-2872400/ 6682400

Fax No.:

91-261-2872400/ 6682796/ 6685731

E-Mail :

rakesh.darji@essar.com

dilip.deokar@essar.com

promod.s@essar.com

steel@essar.com

webmaster@essar.com

Website :

www.essar.com

 

 

Corporate Office :

Essar House, 11, Keshavrao Khadye Marg, Mahalaxmi, Mumbai – 400034, Maharashtra, India

Tel. No.:

91-22-66601100 / 24950606

Fax No.:

91-22-24928896

 

 

Marketing and Sales Office :

6th Floor, Tower-2, Equinox Business Park (Peninsula Techno Park) Off Bandra Kurla Complex, LBS Marg, Kurla (West), Mumbai – 400070, Maharashtra, India

Tel. No.:

91-22-67335000

Fax No.:

91-22-67082189

E-Mail :

steel@essar.com

 

 

Plant 2 :

Vishakhapatnam

 

Scindia Road, Near Flyover, Visakhapatnam – 530004, Andhra Pradesh, India

Tel. No.:

91-891-2523213

Fax No.:

91-891-2559383/ 2556907

 

 

Processing and Distribution Facility Network :

Gat No - 437 and 442, Golechiwadi, Ambi-Nigade Road, MIDC-Talegaon, Pune - 410507, Maharashtra, India 

Tel. No.:

91-211-4661401

 

 

Overseas Offices [Plants] :

Located at

 

·         Canada

·         Indonesia

·         United Kingdom

·         United Arab Emirates

·         Germany

·         China

 

 

DIRECTORS

 

As on 31.03.2013

 

Name :

S. N. Ruia

Designation :

Chairman (upto 07.08.2013)

 

 

Name :

Jatinder Mehra

Designation :

Director

 

 

Name :

V. G. Raghavan

Designation :

Director

 

 

Name :

S. V. Venkatesan

Designation :

Director (upto 29.05.2013)

 

 

Name :

K. V. Krishnamurthy

Designation :

Director (upto 14.11.2012)

 

 

Name :

Jitender Balakrishnan

Designation :

Director (upto 29.05.2013)

 

 

Name :

Rana Som

Designation :

Director

 

 

Name :

S Santhanakrishnan

Designation :

Nominee Director (SBI) (w.e.f. 12.03.2013)

 

 

Name :

Arvind Pande (w.e.f. 29.05.2013)

Designation :

Director

 

 

Name :

S. S. Kohli (w.e.f. 29.05.2013)

Designation :

Director

 

 

Name :

S. R. Jain (w.e.f. 29.05.2013)

Designation :

Director

 

 

Name :

Alok Dhir (w.e.f. 29.05.2013)

Designation :

Director

 

 

Name :

Dilip Oommen

Designation :

Managing Director and CEO

 

 

Name :

Amit Agarwal

Designation :

Director (Finance) (up to 08.11.2012)

 

 

Name :

Alok Gupta

Designation :

Director (Marketing)

 

 

Name :

Ashutosh Agarwala

Designation :

Director (Finance) (w.e.f. 29.05.2013)

 

 

KEY EXECUTIVES

 

Name :

Rakesh Darji Company Secretary

Designation :

Company Secretary

 

 

SHAREHOLDING PATTERN

 

SHARE HOLDING PATTERN DETAILS ARE NOT AVAILABLE

 

BUSINESS DETAILS

 

Line of Business :

Manufacturing and Selling of Steel Products.

 

 

Products :

Item Code No.

 

Product Description

2601

Iron Ores and Concent Rates, Other than Roasted Iron Pyrites

7203

Ferrous Products Obtained by Direct Reduction of Iron Ore and Other Spongy Ferrous Products in Lumps, Pellets or Similar Forms

7208

Flat Rolled Products of Iron or Non Alloy Steel of a Width of 600 MM or More Hot Rolled, Not Clad, Plated or Coated

7210

Flat Rolled Products of Iron or Non Alloy Steel of a Width of 600 MM Clad Plated or Coated with Zinc

7211

Flat Rolled Products of Iron or Non Alloy Steel of a Width of Less than 600 MM Hot Rolled, Not Clad, Plated or Coated

7304

 

Pipes and Hollow Profile Seamless or Iron or Steel for Used in Oil and Gas Pipeline

 

 

 

 

PRODUCTION STATUS (AS ON 31.03.2011)

 

Licensed Capacity - *

 

Installed Capacity (as certified by the management) per annum

 

Particulars

Unit

31.03.2011

 

Iron Ore Pellet

MT

8000000

Hot Briquette Iron / Direct Reduced Iron (Trial Run 17,00,000 MT)

 

6700000

Hot Metal (Under Trial run)

MT

1730000

Hot Rolled Coil

MT

3600000

Cold Rolled Coil

MT

2110000

Colour Coating

MT

400000

Plates

MT

1500000

Pipes (Including Capacity of L-Saw Plant under Trial Run 325,000 MT)

MT

600000

 

 

PRODUCTION

 

Particulars

Unit

31.03.2011

 

Iron Ore Pellet**

MT

5081082

Hot Briquette Iron / Direct Reduced Iron (Including trial run production of 411,782 MT)

MT

4237809

Hot Metal (Under Trial Run)

MT

373354

Hot Rolled Coils/Cold Rolled Coils/ Plates

MT

3217932

Plates (Including trial run production of 77,910 MT)

MT

366606

Pipes (Including trial run production of L-Saw 24,503 MT)

MT

101803

 

* Not applicable in terms of Government of India's Notification No. S.O.477 (E) dated 25th July, 1991.

** Includes production of Pellets on Job Work Basis of 172882 MT

 

 

GENERAL INFORMATION

 

No. of Employees :

Not Divulged

 

 

Bankers :

·         Allahabad Bank

·         Axis Bank Limited

·         Bank of Baroda

·         Bank of India

·         Canara Bank

·         Central Bank of India

·         Corporation Bank

·         Export Import Bank of India

·         HDFC Bank Limited

·         ICICI Bank Limited

·         IDBI Bank Limited

·         Indian Overseas Bank

·         Punjab National Bank

·         State Bank of Bikaner and Jaipur

·         State Bank of Hyderabad

·         State Bank of India

·         State Bank of Mysore

·         State Bank of Patiala

·         Syndicate Bank

·         The Federal Bank Limited

·         The Jammu and Kashmir Bank Limited

·         UCO Bank

·         Union Bank of India

·         Yes Bank Limited

 

 

Facilities :

SECURED LOANS

 

As on 31.03.2013

Rs. in Millions

As on 31.03.2012

Rs. in Millions

LONG TERM BORROWINGS

 

 

13.4% Non-Convertible Debentures of Rs.1000000 each

5250.000

10000.000

Term Loans

 

 

--From Banks

199543.100

134379.000

--From Others

13983.900

4572.200

Buyers Credit for Capital Expenditure

6499.200

15338.300

SHORT TERM BORROWINGS

 

 

Short Term Loans

 

 

--From Banks

7000.000

22750.000

--From Others

0.000

10500.000

Working Capital Loans – From Banks

9674.200

12816.800

Buyer’s Credit for Operational Expenditure

14751.300

30433.200

Buyers Credit Capital Expenditure

160.700

114.000

Total

256862.400

240903.500

 

 

 

Banking Relations :

--

 

 

Auditors :

 

Name :

Deloitte Haskins and Sells,

Chartered Accountants

Address :

Heritage, 3rd Floor, Near Gujarat-Vidhyapith, Off Ashram Road, Ahmedabad – 380 014, Gujarat, India

 

 

Holding Company :

·         Essar Steel Asia Holdings Limited (FKA Essar Resources Mauritius Limited) Immediate Holding Company- (ESAHL) (w.e.f. 29.06.2012)

·         Essar Steel Mauritius Limited - Holding Company of Essar Steel Asia Holdings Limited - (ESML)

·         Essar Steel Limited - Mauritius - Immediate Holding Company (ESTLM) (upto 28.06.2012)

·         Essar Global Fund Limited (FKA Essar Global Limited)

 

 

Subsidiaries :

·         Essar Steel Middle East FZE (ESMEF)

·         Essar Steel Trading FZE (ESTF)

·         Essar Steel Offshore Limited. (ESOSL)

·         Essar Steel Overseas Limited. (ESOL) **

·         Trinity Coal Marketing LLC (EMA) *

·         Essar Minerals Limited (FKA Essar Mining Limited) *

·         Essar Mineral Cooperatief U.A. *

·         Essar Minerals Canada Limited *

·         Essar Minerals INC *

·         Trinity Parent Corporation *

·         Trinity Coal Corporation *

·         Trinity Coal Partners LLC *

·         Bear Fork Resources LLC *

·         Deep Water Resources LLC *

·         Levisa Fork Resources LLC *

·         North Springs Resources LLC *

·         Little Elk Mining Company LLC *

·         Banner Coal Terminal LLC *

·         Hughes Creek terminal LLC *

·         Frasure Creek Mining LLC *

·         Falcon Resources LLC *

·         Prater Branch Resources LLC *

·         Trinity RMG Holding LLC *

·         RMG INC *

 

*These companies are subsidiaries of a wholly owned subsidiary of the Company

** Liquidated w.e.f. 13.09.2012

 

 

Fellow Subsidiaries :

·        Aegis Limited (AEGIS)

·        Essar Power(Jharkhand)Limited.(EPJL)

·        Essar Africa Holdings Limited. (EAHL)

·        Essar Bulk Terminal Paradeep Limited. (EBTPL)

·        Essar Electric Power Development Corporation Limited (EEPDCL)

·        Essar Logistics Limited. (ELL)

·        EssarMineral Resources Limited. (EMRL)

·        EssarOffshore Subsea Limited. (EOSL)

·        Essar Oil Limited. (EOL)

·        Essar Port Limited (EPL)

·         EssarSteel Algomalnc.(ESA-INC)

·         Essar Steel Processing & Distribution UK Ltd. (ESPD UK)

·         PT Essarlndonesia(PTEI)

·         Vadinar Oil Terminals Limited. (VOTL)

·         Vadinar Power Company Limited. (VPOCL)

·         AgcNetworksLimited (Formally Avaya Global) (AGCNL)

·         Equinox Business Parks Private Limited (EBPPL)

·         Essar Bulk Terminal (Salaya) Limited (EBTSL)

·         Essar Oilfields Services Limited (EOSPL)

·         Essar Power (M P) Limited. (EPMPL)

·         Essar Power Gujarat Limited. (EPGL)

·         Essar Project Management Consultant Limited. (EPMCL)

·         Essar Projects (India) Limited. (EPIL)

·         Essar Shipping Limited (ESL)

·         Essar Paradeep Terminals Limited (EPTL)

·         Navabharat Power Private Limited (NPPL)

·         Peak Trading Overseas Limited (PTOL)

·         Vadinar Ports and Terminals Limited (VPTL)

·         Essar Steel Limited - Mauritius (ESTLM) (w.e.f. 29.06.2012)

 

 

Associates :

·         Bhander Power Limited. (BPOL)

·         Essar Bulk Terminal Limited. (EBTL)

·         Essar Power (Orissa) Limited. (EPOL - Orissa)

·         Essar Power Hazira Limited (EPHL)

·         Essar Power Limited. (EPOL)

·         Essar Steel Processing FZCO (ESP-FZCO)

 

 

Companies in which Promoters had significant influence/ Control :

·         Essar Steel Chhattisgarh Limited. (ESCL)

·         Essar Steel Jharkhand Limited. (ESJL)

·         Essar Teleholding Limited. (ETHL)

·         Futura Travels Limited. (FTL)

·         Global Supplies (UAE) FZE (GS)

·         Imperial Consultants and Securities Private Limited (ICSL)

·         India Securities Limited. (ISL)

·         Kartik Estates Private Limited. (KEPL)

·         Kroner Investment Limited. (KIL)

·         NewAmbi Trading & Investments Private Limited (NATIPL)

·         Prajesh Investments Private Limited. (PIPL)

·         Prajesh Marketing Limited. (PML)

·         The Mobilestore Limited. (TML)

·         Tirunelveli Wind Farms Limited (TWFL)

·         Essar Procurement Services Limited (EPSL)

·         Essar Properties Limited. (EPRL)

·         Essar Agrotech Limited. (EAL)

·         Essar Education Limited (EEL)

·         Clickforsteel Services Limited (CFSL)

·         Downtown Securities Private Limited (DTSPL)

·         Bhargava Estates Private Limited (BEPL)

·         Essar House Limited. (EHL)

·         Essar Information Technology Limited. (EITL)

·         Essar Infrastructure Services Limited. (EISL)

·         Essar Investments Limited. (EIL)

·         Ajitesh Estates Private Limited (AEPL)

·         Arkay Holdings Limited. (AHL)

·         Arkay Sea Logistics Limited (ASLL)

·         Essar Services India Limited (ESIL)

·         Essar SEZ Hazira Limited (ESEZHL)

 

# These Companies ceased to be related party w.e.f. 01.04.2012 as the Promoters do not have any significant influence on the Company

 

 

 

CAPITAL STRUCTURE

 

AFTER 31.03.2013

 

Authorised Capital : Rs.72750.000 Millions

 

Issued, Subscribed & Paid-up Capital : Rs.28685.503 Millions

 

As on 31.03.2013

 

Authorised Capital :

No. of Shares

Type

Value

Amount

 

 

 

 

7175000000

Equity Shares

Rs.10/- each

Rs.71750.000 Millions

100000000

10% Cumulative Redeemable Preference Shares

Rs.10/- each

Rs.1000.000 Millions

 

Total

 

Rs.72750.000 Millions

 

Issued, Subscribed & Paid-up Capital :

No. of Shares

Type

Value

Amount

 

 

 

 

2797534656

Equity Shares

Rs.10/- each

Rs.27975.347 Millions

43598951

10% Cumulative Redeemable Preference Shares

Rs.10/- each

Rs.435.990 Millions

4520703

Add: Equity Shares Forfeited

 

Rs.6.700 Millions

 

Total

 

Rs.28418.037 Millions

 

 

a)     Reconciliation of number of shares and amount outstanding at the beginning and at the end of the Reporting period:

 

Particulars

Number

Rs. In Millions

Equity Shares

 

 

At the beginning of the year

2626837822

26268.378

Issued during the year

170696834

1706.968

Outstanding at the end of the year

2797534656

27975.346

Preference Shares

 

 

At the beginning of the year

43598951

435.990

Outstanding at the end of the year

43598951

435.990

 

 

b)    Rights, preferences and restrictions attached to shares Equity Shares

 

The Company has one class of Equity Shares having face value of Rs. 10 per share. Every shareholder is entitled to one vote for every one share held. In the event of liquidation, the equity share holders shall be entitled to receive remaining assets of the Company after distribution of all dues in proportion to their shareholdings.

 

Cumulative Redeemable Preference Shares (CRPS)

 

The Company has issued 43,598,951 10% CRPS of Rs. 10 each. Each CRPS is redeemable at par in 12 equal monthly installments commencing from 01st October, 2017 to 01st September, 2018. The Company shall have option to redeem the CRPS at par in one or more tranches from any or all of the existing holders, anytime after the date of allotment together with arrears of dividend if any and the Board shall give one month's notice for any such redemption to the registered holders of the CRPS.

 

c)     Shares held by Holding Company

 

Out of above equity shares, 1,976,845,435 equity shares are held by Essar Steel Asia Holdings Limited, Mauritius (Previous year 1,914,195,440 equity shares are held by Essar Steel Limited, Mauritius) the holding Company.

 

d)    Details of shareholders holding more than 5% shares in the Company

 

Particulars

Number

% of Holding

Equity Shares

 

 

Essar Steel Asia Holdings Limited1

1976845435

70.66

Essar Steel Limited, Mauritius1

118902096

4.25

Imperial Consultants & Securities Private Limited 1.2

421760954

15.08

Shares under Trust (Venkatraman Govind Raghavan)

191517500

6.85

 

2709025985

96.84

 

·         Number of shares includes 1,911,568,602 shares acquired from Essar Steel Limited, Mauritius and 10,855,257 shares from Imperial Consultants and Securities Private Limited, for which transfer of shares in demat account is pending and in respect of such shares Essar Steel Asia Holdings Limited (ESAHL) has made necessary declaration under Section 187C of the Companies Act, 1956 regarding beneficial ownership of such shares.

 

·         As per the Scheme of Arrangement (SOA) between Essar Investment Limited (EIL) and Imperial Consultants and Securities Private Limited (Imperial) sanctioned by the Hon'ble High Court at Mumbai vide order dated 20th January, 2012 and by Madras High Court vide order dated 5th March, 2012, Investment and Finance Division of EIL has been demerged into Imperial. In terms of said SOA, assets and liabilities of Investment Division of EIL stood transferred in the books of Imperial with effect from 30th March, 2012. However, pending completion of required formalities for transfer of shares, name of EIL is appearing in the register of members of the Company. Company has received a declaration from EIL and Imperial under section 187C of the Companies Act, 1956 regarding beneficial ownership of the said shares.

 

 

Particulars

31.03.2013

 

Number

% of Holding

Preference Shares

 

 

IFCI Limited

22116599

50.73

Imperial Consultants and Securities Private Limited

16940180

38.85

ICICI Bank Limited

--

--

 

39056779

89.58

 

e)     Aggregate number of Bonus Shares issued, shares issued for consideration other than cash and shares bought back during the period of five years :

 

Particulars

31.03.2013

Equity  Shares allotted as fully paidup pursuant to scheme of Amalgamation

1073249784

 

 

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

 

28418.000

26711.100

(b) Reserves & Surplus

 

42617.100

63823.500

(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)

 

71035.100

90534.600

 

 

 

 

(3) Non-Current Liabilities

 

 

 

(a) long-term borrowings

 

228179.200

166645.400

(b) Deferred tax liabilities (Net)

 

0.000

0.000

(c) Other long term liabilities

 

1622.900

1909.900

(d) long-term provisions

 

6559.400

4581.400

Total Non-current Liabilities (3)

 

236361.500

173136.700

 

 

 

 

(4) Current Liabilities

 

 

 

(a) Short term borrowings

 

42871.000

76614.000

(b) Trade payables

 

76458.300

43870.500

(c) Other current liabilities

 

50425.000

39178.200

(d) Short-term provisions

 

731.800

4258.700

Total Current Liabilities (4)

 

170486.100

163921.400

 

 

 

 

TOTAL

 

477882.700

427592.700

 

 

 

 

II.            ASSETS

 

 

 

(1) Non-current assets

 

 

 

(a) Fixed Assets

 

 

 

(i) Tangible assets

 

287660.800

205879.400

(ii) Intangible Assets

 

190.500

222.100

(iii) Capital work-in-progress

 

60047.700

112951.700

(iv) Intangible assets under development

 

0.000

0.000

(b) Non-current Investments

 

10333.100

5398.700

(c) Deferred tax assets (net)

 

17526.600

3237.700

(d) Long-term Loan and Advances

 

6851.900

8777.200

(e) Other Non-current assets

 

10333.100

9589.700

Total Non-Current Assets

 

392943.700

346056.500

 

 

 

 

(2) Current assets

 

 

 

(a) Current investments

 

0.000

0.000

(b) Inventories

 

38475.200

40446.400

(c) Trade receivables

 

6812.700

5896.600

(d) Cash and cash equivalents

 

6231.100

6509.600

(e) Short-term loans and advances

 

28409.200

22502.900

(f) Other current assets

 

5010.800

6180.700

Total Current Assets

 

84939.000

81536.200

 

 

 

 

TOTAL

 

477882.700

427592.700

 

 

SOURCES OF FUNDS

 

 

 

31.03.2011

SHAREHOLDERS FUNDS

 

 

 

1] Share Capital

 

 

25710.000

2] Share Application Money (Pending Allotment)

 

 

2482.400

3] Reserves & Surplus

 

 

77329.800

4] (Accumulated Losses)

 

 

0.000

NETWORTH

 

 

105522.200

LOAN FUNDS

 

 

 

1] Secured Loans

 

 

216732.300

2] Unsecured Loans

 

 

7111.600

TOTAL BORROWING

 

 

223843.900

DEFERRED TAX LIABILITIES

 

 

607.800

 

 

 

 

TOTAL

 

 

329973.900

 

 

 

 

APPLICATION OF FUNDS

 

 

 

 

 

 

 

FIXED ASSETS [Net Block]

 

 

102544.300

Capital work-in-progress

 

 

175083.900

 

 

 

 

INVESTMENT

 

 

3970.200

DEFERRED TAX ASSETS

 

 

638.700

 

 

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

 

 

 

Inventories
 
 
52225.000

 

Sundry Debtors
 
 
5147.600

 

Cash & Bank Balances
 
 
9210.000

 

Other Current Assets
 
 
11296.000

 

Loans & Advances
 
 
30251.100

Total Current Assets
 

 
108129.700

Less : CURRENT LIABILITIES & PROVISIONS
 

 
 

 

Sundry Creditors
 
 
24331.500

 

Other Current Liabilities
 
 
33101.200

 

Provisions
 
 
2960.200

Total Current Liabilities
 

 
60392.900

Net Current Assets
 

 
47736.800

 

 

 

 

MISCELLANEOUS EXPENSES

 

 

0.000

 

 

 

 

TOTAL

 

 

329973.900

 

 

PROFIT & LOSS ACCOUNT

 

 

PARTICULARS

31.03.2013

31.03.2012

31.03.2011

 

SALES

 

 

 

 

 

Income

150384.500

162738.700

123015.000

 

 

Other Income

3011.600

5367.900

5260.900

 

 

TOTAL                                     (A)

153396.100

168106.600

128275.900

 

 

 

 

 

Less

EXPENSES

 

 

 

 

 

Cost of Materials Consumed

89941.100

89340.700

 

 

Purchase of Traded Goods

2055.900

1670.300

 

 

 

Energy Cost

28223.400

30466.800

 

 

 

Changes in Inventories of Finished Goods, Work in Progress and Stock in Trade

(270.700)

9692.700

 

 

 

Employee Benefits Expenses

3117.400

3899.800

110948.900

 

 

Manufacturing and Asset Maintenance

4457.500

4415.800

 

 

 

Administrative Expenses

2287.700

3562.600

 

 

 

Selling & Distribution Expenses

5360.700

5683.100

 

 

 

Exchange Variation and Derivative Losses (net)

6589.000

3723.000

 

 

 

Exceptional Item

13465.500

0.000

 

 

 

TOTAL                                     (B)

155227.500

152454.800

110948.900

 

 

 

 

 

Less

PROFIT/(LOSS) BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B)     (C)

(1831.400)

15651.800

17327.000

 

 

 

 

 

Less

FINANCIAL EXPENSES                                    (D)

24809.800

18629.900

12187.400

 

 

 

 

 

 

PROFIT/(LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D)                                (E)

(26641.200)

(2978.100)

5139.600

 

 

 

 

 

Less

DEPRECIATION/ AMORTISATION                     (F)

15622.100

9863.700

8914.600

 

 

 

 

 

 

PROFIT/(LOSS) BEFORE TAX (E-F)                  (G)     

(42263.300)

(12841.800)

(3775.000)

 

 

 

 

 

Less

TAX                                                                  (H)

14413.900

(326.200)

2112.300

 

 

 

 

 

 

PROFIT/(LOSS) AFTER TAX (G-H)                    (I)

(27849.400)

(12515.600)

(1662.700)

 

 

 

 

 

 

EARNINGS IN FOREIGN CURRENCY

 

 

 

 

 

FOB Value of Exports

36927.900

41557.500

20227.600

 

 

Others

2472.900

1872.600

1622.200

 

TOTAL EARNINGS

39400.800

43430.100

21849.800

 

 

 

 

 

 

IMPORTS

 

 

 

 

 

Raw Materials

33809.200

32993.200

8835.600

 

 

Production Consumables, Stores and Spares and Fuel

6540.200

9387.800

28469.100

 

 

Capital Goods

3315.500

3762.700

11199.600

 

 

Traded Goods

0.000

17.300

358.300

 

TOTAL IMPORTS

43664.900

46161.100

48862.600

 

 

 

 

 

 

Earnings Per Share (Rs.)

(10.59)

(4.84)

(0.72)

 

 

KEY RATIOS

 

PARTICULARS

 

 

31.03.2013

31.03.2012

31.03.2011

PAT / Total Income

(%)
(18.16)

(7.45)

(1.30)

 

 
 

 

 

Net Profit Margin

(PBT/Sales)

(%)
(28.10)

(7.89)

(3.07)

 

 
 

 

 

Return on Total Assets

(PBT/Total Assets}

(%)
(11.34)
(4.46)
(1.79)

 

 
 

 

 

Return on Investment (ROI)

(PBT/Networth)

 
(0.59)
(0.14)
(0.04)

 

 
 

 

 

Debt Equity Ratio

(Total Debt /Networth)

 
3.82

2.69

2.12

 

 
 

 

 

Current Ratio

(Current Asset/Current Liability)

 
0.50

0.50

1.79

 

 

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

 

26711.100

28418.000

Reserves & Surplus

 

63823.500

42617.100

Net worth

 

90534.600

71035.100

 

 

 

 

long-term borrowings

 

166645.400

228179.200

Short term borrowings

 

76614.000

42871.000

Total borrowings

 

243259.400

271050.200

Debt/Equity ratio

 

2.687

3.816

 

 

 

 

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

123,015.000

162,738.700

150,384.500

 

 

32.292

-7.591

 

 

 

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

123015.000

162738.700

150384.500

Profit

         (1662.700)

(12515.600)

(27849.400)

 

(1.35%)

(7.69%)

(18.52%)

 

 

 

LOCAL AGENCY FURTHER INFORMATION

 

CURRENT MATURITIES OF LONG-TERM DEBT

Rs. In Millions

Particular

31.03.2013

31.03.2012

31.03.2011

 

 

 

 

Current maturities of long-term debt

25443.000

24206.400

13810.900

 

 

 

 

 

Sr. No.

Check List by Info Agents

Available in Report (Yes / No)

1]

Year of Establishment

Yes

2]

Locality of the firm

Yes

3]

Constitutions of the firm

Yes

4]

Premises details

No

5]

Type of Business

Yes

6]

Line of Business

Yes

7]

Promoter's background

No

8]

No. of employees

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

No

31]

Date of Birth of Proprietor/Partner/Director, if available

No

32]

PAN of Proprietor/Partner/Director, if available

No

33]

Voter ID No of Proprietor/Partner/Director, if available

No

34]

External Agency Rating, if available

Yes

 

 

LITIGATION DETAILS

 

HIGH COURT OF GUJARAT

 

SPECIAL CIVIL APPLICATION No. 2859 of 2014

 

Status : PENDING

( Converted from : C/ST/2708/2014 )

CCIN No : 001021201402859

 

Last Listing Date: 28/04/2014

 

Coram

HONOURABLE MR.JUSTICE A.J.DESAI

Not Before :

HONOURABLE MR.JUSTICE KSHITIJ R.VYAS

HONOURABLE MR.JUSTICE N.G.NANDI

HONOURABLE MR.JUSTICE P.B.MAJMUDAR

HONOURABLE MR.JUSTICE Y.B.BHATT

 

S.NO.

Name of the Petitioner

Advocate On Record

1

DAKSHIN GUJARAT VIJ COMPANY LIMITED

MS LILU K BHAYA for: Petitioner(s) http://gujarathc-casestatus.nic.in/gujarathc/images/arrow1.png1

 

 

S.NO.

Name of the Respondant

Advocate On Record

1

ESSAR STEEL INDIA LIITED

NANAVATI ASSOCIATES for :Respondent(s) http://gujarathc-casestatus.nic.in/gujarathc/images/arrow1.png1

2

APPELLATE AUTHORITY

 

 

 

Presented On

: 19/02/2014

Registered On

: 19/02/2014

Bench Category

: -

District

: SURAT

Case Originated From

: THROUGH ADVOCATE

Listed

: 8 times

 

StageName

ADMISSION (ADJOUNRED MATTERS)

Classification

SJ - NON-SERVICE - ELECTRICITY ACT, 2003 - DISPUTE WITH RESPECT TO ELECTRICITY BILL

Act

ELECTRICUTY ACT, 1910

Other Forums

S.No.

CASEDETAILS

TRIBUNAL REFERRENCE

ORDER PASSED BY

JUDGEMENT DATE

PLACE

1

CEI/INS/APPL/ESIL/

11380/2013

OFFICE OF CHIEF ELECTRICAL INSPECTOR, GANDHINAGAR 

APPELLATE AUTHORITY

01/11/2013

SURAT

Office Details

S. No.

Filing Date

Document Name

Advocate Name

Court Fee on Document

Document Details

1

19/02/2014

VAKALATNAMA

MS LILU K BHAYA ADVOCATE
for PETITIONER(s) http://gujarathc-casestatus.nic.in/gujarathc/images/arrow1.png1

5

MS LILU K BHAYA(1705) for P:1

2

19/02/2014

MEMO OF APPEAL/PETITION/SUIT

MS LILU K BHAYA ADVOCATE
for PETITIONER(s) http://gujarathc-casestatus.nic.in/gujarathc/images/arrow1.png1

100

MS LILU K BHAYA(1705), for P:1

3

20/03/2014

AFFIDAVIT IN REPLY

NANAVATI ASSOCIATES ADVOCATE
for RESPONDENT(s) http://gujarathc-casestatus.nic.in/gujarathc/images/arrow1.png1

0

NANAVATI ASSOCIATES(1375) for R:1

Court Proceedings

S. No.

Notified Date

Court

Code

Board Sr. No.

Stage

Action

Coram

1

20/02/2014

18

3

ADMISSION (FRESH MATTERS)

NEXT DATE

HONOURABLE MR.JUSTICE A.J.DESAI

2

11/03/2014

18

33

URGENT ADMISSION (ADJOUNRED MATTERS)

NEXT DATE

HONOURABLE MR.JUSTICE A.J.DESAI

3

25/03/2014

18

30

URGENT ADMISSION (ADJOUNRED MATTERS)

NEXT DATE

HONOURABLE MR.JUSTICE A.J.DESAI

4

31/03/2014

18

21

URGENT ADMISSION (ADJOUNRED MATTERS)

NEXT DATE

HONOURABLE MR.JUSTICE A.J.DESAI

5

01/04/2014

18

64

NOTICE & ADJOURNED MATTERS

NEXT DATE

HONOURABLE MR.JUSTICE A.J.DESAI

            Available Orders

S. No.

Case Details

Judge Name

Order Date

CAV

Judgement

Questions

1

SPECIAL CIVIL APPLICATION/5621/2014

HONOURABLE MR.JUSTICE A.J.DESAI

21/04/2014

N

ORDER

-

 

 

UNSECURED LOAN:

 

Particulars

 

As on 31.03.2013

Rs. in Millions

As on 31.03.2012

Rs. in Millions

LONG TERM BORROWINGS

 

 

Dollar / Rupee Notes

 

 

--From Banks

1974.500

1942.700

--From others

29.700

37.900

Buyers Credit for Capital Expenditure

0.000

6.900

Sales Tax Deferral Loan

338.800

338.800

Long Term maturities of Finance Lease obligations

18.300

29.600

Inter Corporate Deposits

 

 

--From Others

541.700

0.000

SHORT TERM BORROWINGS

2903.000

 

Inter corporate Deposits from related parties

11284.800

0.000

Total

14187.800

2355.900

 

 

INDEX OF CHARGE:

 

Sr. No.

Charge ID

Date of Charge Creation/Modification

Charge amount secured

Charge Holder

Address

Service Request Number (SRN)

1

10450965

28/09/2013

60,000,000,000.00

SBICAP Trustee Company Limited

202, Maker Tower, 'E', Cuffe Parade, Colaba, Mumbai – 400 005, Maharashtra, India

B85701035

2

10452159

26/09/2013

866,933,200.00

SBICAP Trustee Company Limited

202, Maker Tower, 'E', Cuffe Parade, Colaba, Mumbai – 400 005, Maharashtra, India

B86276730

3

10449813

24/09/2013

2,506,340,000.00

SBICAP Trustee Company Limited

202, Maker Tower, 'E', Cuffe Parade, Colaba, Mumbai – 400 005, Maharashtra, India

B85302016

4

10452157

13/09/2013

3,250,000,000.00

INDIAN OVERSEAS BANK

229, Bakhtawar, Ground Floor, Nariman Point, Mumbai – 400 021, Maharashtra, India

B86275625

5

10448499

10/08/2013

7,000,000,000.00

YES BANK LIMITED

Nehru Centre, 9th Floor, Discovery Of India, Dr. A B Road. Worli, Mumbai – 400018, Maharashtra, India

B84760941

6

10441614

29/07/2013

5,384,700,000.00

SBICAP Trustee Company Limited

202, Maker Tower, 'E', Cuffe Parade, Colaba, Mumbai – 400 005, Maharashtra, India

B81456519

7

10433365

26/06/2013

1,320,000,000.00

SBICAP Trustee Company Limited

202, Maker Tower, 'E', Cuffe Parade, Colaba, Mumbai – 400 005, Maharashtra, India

B78096948

8

10433227

05/06/2013

5,000,000,000.00

SBICAP Trustee Company Limited

202, Maker Tower, 'E', Cuffe Parade, Colaba, Mumbai – 400 005, Maharashtra, India

B78043742

9

10423211

02/05/2013

500,000,000.00

SBICAP Trustee Company Limited

202, Maker Tower, 'E', Cuffe Parade, Colaba, Mumbai – 400 005, Maharashtra, India

B74225921

10

10418593

12/04/2013

816,637,500.00

SBICAP Trustee Company Limited

202, Maker Tower, 'E', Cuffe Parade, Colaba, Mumbai – 400 005, Maharashtra, India

B72850175

 

 

NATURE OF OPERATION:

 

Subject owns and operates an integrated steel manufacturing unit for manufacturing of fiat rolled products at Hazira - District Surat, a Precoated facility at Pune, a Beneficiation Plant at Kirandul, Slurry Pipeline, Peptization Plant at Vizag and at Paradeep. The Company is also in the process of setting up a Beneficiation Plant at Dabuna (Odisha) and another Peptization Plant at Paradeep. The Company also operates Processing and Distribution centres, Hypermarts and Express Marts at various locations across India.

 

 

OPERATIONS:

 

Year 2012 was a gloomy year for world economy as the recessionary trends continued globally. With Eurozone crisis and China slowdown, industries observed much weaker growth. Indian steel industry took a major hit due to a slower global and ban on iron ore mining in Karnataka as well as Coal scam issues.

 

Post expansion to 10 MTPA Steel Complex, your Company become the largest single location fiat steel producer in the country and the fourth largest such producer globally. With Blast Furnace and Corex joining the previous DRI (Direct Reduced Iron) technology, your company has now greater flexibility in usage of raw materials. Additionally, the by-product gases generated by these two new units can suitably replace natural gas at several places in your integrated steel complex, thereby reducing dependence on expensive natural gas sources from external providers. Your Company is now able to offer the entire range of fiat products - from thin strips to pipes as well as cold rolled and coated products.

 

 

GLOBAL OVERVIEW:

 

FY 2013 remained a sluggish year for the global steel industry. Overall, it grew by a mere 0.72% during 2012 as per the latest World Steel Association estimates -total crude steel production in 2012 was 1,547 million MT vis-a-vis 1,536 million MT in 2011.

 

Country-wise performance largely reflected disparities linked to macro-economic environment and operating dynamics in respective economies. China continued to maintain its dominance with a 46.3% share in total crude steel production exhibiting a 2.1% growth over 2011 – linked mainly to domestic demand. Japanese (2nd largest producer) steel output contracted by 0.4% despite heavy support for exports from a devalued currency. United States, India and Russia - the other top producers - grew by 2.7%, 5.6% and 2.2% respectively in terms of crude steel production. Economic recession in Europe implied contraction in local steel demand. There were scattered opportunities in other geographies.

 

Capacity utilization rates remained below 80% -exhibiting a serious challenge facing the industry. Correction in prices of primary raw materials - i.e., Iron Ore and Coking Coal - lagged the ability of the industry to sustain revenue realization. This created margin pressure and compounded financial problems for the steel industry. Consequently, capacity outages, particularly in Europe, became inevitable due to prevailing lackluster demand and high operating cost. Overall, industry performance hinged upon the ability of producers to extend competitive prices to customers often sub-optimal to operating cost.

 

The outlook for FY 2014 is even more difficult than FY2013. Global steel production is expected to remain fiat to moderate growth. China is expected to maintain its momentum in steel production - a core sector offering large-scale employment. All other regions of the world are expected to be saddled with over-capacity and are expected to curtail production in order to remain market-relevant. Global steel consumption is likely to remain fiat to decline as Fixed Asset Investment and steel intensity decline during the FY 2014.

 

 

DOMESTIC OVERVIEW:

 

India's overall steel consumption grew by only 3.2% in 2012 to around 72 million MT due to subdued demand from across consuming sectors like infrastructure and construction. The domestic crude steel production grew by 5.6% in 2012 to 78 million MT.

 

Many producers in India commissioned additional capacity during the year. Further capacity addition, in both public as well as private sector, is planned during FY2014 due to anticipated future demand, particularly considering that India's per capita consumption low. India's per capita steel consumption is still too low (59 kg compared to 1157 kg in South Korea, 507 kg in Japan, 460 kg in China and 235 kg in the North America).

 

However, in the short to medium term, this will lead to excess domestic capacity and is likely to create additional margin pressure for the Indian steel industry already saddled with high costs and cheap imports especially from Japan and South Korea, which enjoy a preferential import duty.

 

 

AWARDS AND ACCOLADES:

 

·         National Safety Award from JCSSI "ISPAT SURAKSHA PURASKAR 2013" for the year 2011 and 2012 from Joint Committee on Safety, Health & Environment (JCSSI) under various categories for Outstanding Performance in the field of HSE.

·         HSE topped at India Manufacturing Excellence Award (IMEA) assessment audit with a score of 77.7 and has set a benchmark among all Industries & Topped Metal Sectors across India in a survey conducted by The Economic Times - India Manufacturing Excellence Awards in Partnership with Frost & Sullivan.

·         Gujarat Safety Council in association with Directorate of Industrial Safety & Health Awarded Dr. Anil Jain, "Safety Man of the Year 2012". The Award was presented by Shri. Saurabh Patel, Hon'ble Minister, Gujarat State Govt. at 34th Annual Safety Conference organized at Ahmedabad.

·         "Safety Innovation Award-2012" from the Institution of Engineers (India). Award presented by Dr. Narendra Jadhav - Member Planning Commission at inaugural function of "Safety Convention 2012: Safety in Sustainable Development".

·         Runners up for "Excellence in Safety - Large Enterprises" Manufacturing Today Awards 2012.

·         Green Rating Project, Three Leaves Award, the Highest among Indian Steel Plants Awarded by Center for Science and Environment (CSE). This is a very prestigious award and the Company is rated 2nd amongst 22 steel plants were evaluated. The award was presented by Shri. Montek Singh Ahluwalia, Dy. Chairperson, Planning Commission and Smt. Jayanthi Natarajan, Union Minister of State for Environment & Forests in

·         4th June 2012.

·         Green Environmental Contest awarded by Baroda Productive Council for the year 2011­12 and Essar Steel stood first amongst all the industries of Gujarat.

·         Gold Safety Award 2012 for excellent achievements in Safety management system from Greentech Foundation, New Delhi.

·         Silver Environment Award 2012 for excellent achievements in Environment Management system from Greentech Foundation, New Delhi

·         Best Safety Practices Award 2012 from Deccan Chamber of Commerce, Industries and Agriculture , Pune.

·         "Gold Award - Metals Sector, Mega Large Business" by Indian Manufacturing Excellence Awards-2012 sponsored by The Economic Times.

·         Quality Circle Forum Of India (QCFI) - Baroda (Gold Award & Sarvashetha Puraskar Award).

·         Gold Award in State Level 5'S' competition organized by QCFI Baroda.

·         Diamond Award in Lean Six Sigma Presentation organized by Concept Business Excellence.

·         Commendation award in QCI-DL Shah National Award for Quality.

·         Steel Hazira bagged FICCI Water Efficiency Award at the Water Awards 2012 presented by FICCI (Federation of Indian Chambers of Commerce & Industry), in association with

HSBC.

·         The Company has been certified with a PLATINUM AWARD second time in a row by Caterpillar worldwide. Last year we had got the Platinum Award and it was a quite a challenge to retain the Platinum Award this time.

·         SAP Awards for Customer Excellence (ACE) 2012 recognized the Company for being the "Best Run Manufacturing Organization" at a ceremony in Mumbai on 19th October, 2012.

 

 

CERTIFICATE AND RECOGNITION:

 

·         Gujarat Safety Council in association with Directorate of Industrial Safety and Health Govt. of Gujarat awarded Essar Steel India Ltd., Safety Honour and Merit Certificates for the year 2011:

·         HRC Division: Certificate of Honour - for achieving more than 3 Million Accident Free Man Hours.

·         HBI Division: Certificate of Merit - for achieving more than 2 Million Accident Free Man Hours.

·         Pipe Division: Certificate of Merit - for achieving more than 2 Million Accident Free Man Hours.

·         National Safety Council of India recognized Essar Steel India Ltd., Hazira for Landmark Safety Achievement of 35.55 Million LTI Free Man hours.

·         41st National Safety Day Celebrations of Essar Steel India Ltd. recognized by National Safety Council of India by publishing clips in Front Cover Page of Industrial Safety Chronicle (Vol. No. XLIII April-June 2012).

·         Essar Steel India Limited Hazira received recognition from WSA regarding participation in their CO2 data collection program.

·         Certificate of Appreciation for Commendable Fire Fighting Operation at IOCL Terminal, Hazira, from Shri. D. C. Chaudhari, Director-Directorate of Industrial Safety & Health Gujarat on the occasion of Shram Awards, State Level Prize Distribution Ceremony held at Surat, Gujarat. For Commendable Fire Fighting Operation by Essar Steel Team at IOCL Terminal Fire, Hazira, Mr. Rakesh Chaturvedi (Sr. Manager-Fire Services EStIL) & Mr. Narendra Doot (Asst. Manager-Fire Services, EStIL) received Certificates for their valiant Heroism from Shri. Ganpat Vasava, Hon'ble Cabinet Minister, Govt. of Gujarat on the eve of National Republic Day at Surat.

·        The Company presented 3 Projects on Environment Improvement at Vibrant Gujarat Summit held at Gandhinagar by Govt. of Gujarat. The initiatives were well appreciated by Gujarat State Environment Minister, Gujarat Pollution Control Board (GPCB) Chairman & Member Secretary.

·         Company's Carbon Management Practices were lauded at the International Carbon Disclosure Project (CDP), a recent event held at the Bombay Stock Exchange (BSE) at Mumbai. Under Carbon Disclosure Leadership Index (CDLI) Essar Steel scored 80 out of 100.

·         Recognition of three Essar Steel Employees under various categories in Safety Competition organized by Gujarat Safety Council. The Awards were presented to them in 34th Annual Safety Conference organized by Gujarat Safety council in association with Directorate of Industrial Safety and Health at Ahmedabad.

·         Recognition of two Essar Steel Employees' Poster, in Annual JCSSI Calendar Competition 2013. These posters were published in the Annual JCSSI Calendar for the year 2013.

·         The Company participated in Workshop "Strategic Development towards Best Safety Practices and Human Interface" Organized by Essar Power Vadinar in Coordination with Directorate of Industrial Safety and Health, Govt. of Gujarat.

·         The Company participated in Conference organized on "Safety for Sustainable Manufacturing Growth" by Federation of Indian Chambers of Commerce & Industry (FICCI) inaugurated by Shri. Mallikarjun Kharge, Union Minister for Labour and Employment.

·         Tata Steel Executives visited our Hazira Complex to witness our Benchmark HSE Practices & Initiatives. Quote, "We are thankful to you for providing us the opportunity of getting exposed to the best of safety practices embedded in Essar Culture", Unquote.

·         As part of Confederation of Indian Industry (CII) Mission on Best Practices in Safety, Health & Environment (SHE) to Hazira, Essar Steel promoted Best HSE Practices across the State of Gujarat.

 

 

FIXED ASSETS:

 

Tangible Assets

           

·         Freehold Land

·         Leasehold Land

·         Buildings

·         Plant and Machinery

·         Furniture and Fixtures

·         Office Equipment

·         Computers

·         Vehicles

·         Ships and Vessels

·         Railway Sidings and Wagons

·         Aircraft

·         Software

 

 

PRESS RELEASES

 

ESSAR STEEL TO RAISE RS 22410.000 MILLIONS BY SELLING 3 NON-CORE ASSETS

 

Essar Steel aims to raise a minimum of Rs 22410.000 Millions by selling three non-core assets for paring some of its $4 billion (around Rs 244000.000 Millions) debt and reducing the strain on its balance sheet.

 

The Ruias-promoted leading steelmaker has convened an extraordinary shareholders' meeting on August 24, seeking their approval.

 

The move was necessitated due to 2.22 times rise in Essar's standalone net loss in the last financial year to Rs 27850.000 Millions. Its interest payments had also risen by nearly 41 per cent to Rs 31400.000 Millions, while total expenditure, at Rs 150790.000 Millions, had overshot its total income, at Rs 150380.000 Millions.

 

"In order to improve liquidity, reduce debt burden and to focus on the core business area, a financing plan has been worked out. Under this plan it is proposed to sell out or otherwise transfer some of the undertakings/assets/projects to strategic investor/SPV company, ongoing concern basis," the company said in its notice for the EGM.

 

Simultaneously, the company will sign long term supply/ service agreement with the buyer to ensure smooth functioning of operations.

 

According to the plan, Essar is in advanced stage of negotiations with Inox Air Products to sell one its undertaking which is in the business of production of oxygen, nitrogen and argon etc for captive supply of company's needs at its Hazira plant "for not less than Rs 800 crore".

 

It is also planning to sell 1.53 million tonnes per annum under construction coke oven plant project and 253 km long Odisha slurry pipeline project between Dabuna and Paradeep for "not being lower than (their) book value".

 

The book values of coke oven plant and slurry pipeline are Rs 642.05 crore and Rs 799.82 crore, respectively.

 

A company spokesperson said that "these are none core assets to steel making and forms insignificant part of the total assets of the company. Essar Steel proposes to outsource these assets since it can be operated more efficiently by the company's specialising in these activities."

 

Early this month, the company had said it will be raising $2 billion through pre-export finance to retire rupee-denominated debt. The move is aimed at freeing Essar's balance sheet from fluctuation in currency rates and ensuring at least Rs 850 crore annual savings on interest payments.

 

The company already has RBI permission to raise upto $2 billion through export securitisation and is aiming to complete it during the current fiscal. In June, the company had raised $1 billion through External Commercial Borrowing (ECB), which will result in Rs 450 crore savings annually.

 

Essar has invested about Rs 37,000 crore to increase its steel making capacity to 10 MTPA from 4.6 MTPA. The new capacity was envisaged as an integrated facility with dedicated iron ore pellet supplies from a pellet plant in Odisha, a dedicated port, coal based power plant and a 400 kva transmission line.

 

 

ESSAR STEEL HOPES TO RAISE $2 BN FY14 END TO PARE RE DEBT

 

Mumbai: Essar Steel has said it hopes to raise USD 2 billion through pre-export finance by the end of the current financial year to retire part of its rupee debt, a company official has said.

 

Pre-export funds are borrowed against confirmed orders from foreign buyers.

 

"At present, we are in talks with financial institutions. We hope to raise the money by the end of the financial year," an Essar Steel official said.

 

Earlier, the company had said it planned to raise USD 2 billion through pre-export finance to retire rupee-denominated debt, which will ensure at least Rs 8500.000 millions of annual savings through lesser interest outgo.

 

The company has around 20,000 crore debt on its books and a significant portion of it is rupee-loans.

 

The official said that recent rupee fluctuation will not impact its future fund raising plans in dollar terms as it has natural hedge against the forex fluctuation.

 

When a company exports and imports, it is said to have natural hedge as any rise in import price due to fall in the rupee gets compensated through gain in exports.

 

According to the firm, interest cost will come down through refinancing of debt from around 12.5 percent to 6-7 percent.

 

"Not only the interest cost will come down, this will also help us increase the tenor of these loans," the official said.

 

The firm had already raised USD 1 billion through external commercial borrowings (ECB) in June with an annual cost saving of Rs 4500.000 milions

 

Essar Steel has a capacity of 14 million tonne per annum with presence in India, Canada, the US, the West Asia and Asia.

 

 

ESSAR STEEL PROMOTERS TO INFUSE UP TO RS 10000.000 MILLIONS EQUITY

 

Promoters of Essar Steel will infuse an additional equity of up to Rs 1.0000.000 millions into the loss making steelmaker by acquiring its shares on a preferential basis. The move is aimed at meeting the company's capex and operational requirements as well as strengthening the capital base, Essar said in its Annual General Meeting notice, while seeking shareholders approval. The AGM is scheduled to be held tomorrow in Hazira, Gujarat.

The capital infusion by the promoters will also help the company in reducing strain on its balance sheet as its consolidated net loss had widened by over 2.5 times in the last fiscal to Rs 51050.0000 millions. Its interest payments had also risen by over 32 percent to Rs 29550.000 millions, while the current liabilities (Rs 214984.800 millions) have exceeded its current assets (Rs. 95930.190 millions) by Rs. 119052.900 millions in 2012-13.

The unlisted leading steelmaker has proposed to make the preferential allotment in next 12 months to the promoters. Following this, promoters' stake in the company will increase marginally by 0.18 percent to 97.45 percent.

"Resolved that...consent of the company be and is hereby accorded to the Board of Directors of the company to issue and allot...on preferential basis such number of equity shares...for an amount not exceeding Rs 10000.000 millions to Essar Steel Asia Holdings Ltd, Mauritius/Essar Steel Ltd, Mauritius...," the company said in the AGM notice.

The Ruia family, led by Shashi and Ravi Ruia, are the promoters of the company through Essar Steel Asia Holdings Ltd, Mauritius. According to the Annual Report of Essar, its promoters infused Rs.7648.600 millions equity into the company between November, 2012 and June, 2013 by acquiring over Rs. 168.100 Millions shares.

As of March 2013, the company's paid up equity capital was Rs 2,7982.000 millions "In order to raise balance funds and to meet fund requirements, enabling resolution is required as proposed at item no 10 of the (AGM) notice," the company said.

The company said it has approached a Chartered Accountant for valuation of shares and number of shares to be allotted would be decided accordingly. Last month, the company had taken shareholders approval to raise a minimum of Rs. 22410.000 Millions by selling three non-core assets for paring some of its USD 4 billion (around Rs. 260000.000 millions) debt and reducing the strain on its balance sheet.

Essar also has plans to raise USD 2 billion through pre-export finance to retire majority of its rupee-denominated debt and is aiming to complete its during the current fiscal. The move would help the company in reducing interest costs by about Rs. 8500.000 millions, enhancing loan tenure and negating the impact of fluctuation in currency rates. The company, which has invested Rs 370000.000 millions to increase its capacity to 10 MTPA, has already secured Reserve Bank's permission for raising dollar loans

 

ESSAR STEEL MAY RAISE PRICES BY RS 1,000/TN NEXT MONTH

 

Mumbai February 26, 2014

 

Private steel firm Essar Steel is likely to raise product prices by around Rs 1,000 per tonne next month on the back of rise in input costs and demand uptick during the past two months among others.

 

"Essar Steel is likely to raise product prices by around Rs 1,000 per tonne next month. This is primarily cost push along with some demand uptick in the fourth quarter," according to a source.

 

The steel firm has also seen rise in demand for exports in recent months and expects the momentum to continue, the source said.

 

"If you see the steel prices in the global market, they have firmed up by around USD 20-30 in recent time. So, that will reflect in the domestic prices soon," the source said.

 

The company officials could not be contacted.

 

Earlier, JSW Steel said it had raised product prices up to Rs 750 per tonne to absorb the rising cost.

 

While steel companies have increased prices three times in the past few months, industry experts are sceptical about its complete absorption by the market.

 

"Given the weakness in the steel consumption, it remains to be seen whether such price hike is sustainable," Jayanta Roy, senior vice-president and co-head, corporate sector ratings at Icra, said.

 

Essar Steel, which is fully integrated flat steel manufacturer, has a capacity of 14 million tonne per annum with presence in India, Canada, the US, West Asia and Asia.

 

 

ESSAR STEEL PREPAYS RS 2050.000 MILLIONS LOAN TAKEN FROM AXIS BANK

 

NEW DELHI, MARCH 10:  Ruias-promoted Essar Steel today said it prepaid Rs 2050.000 Millions of loans taken from Axis Bank.

 

The company had issued secured redeemable non-convertible debentures of Rs 1.000 Million each aggregating Rs 2050.000 Millions to the private sector lender.

 

The coupon rate on the securities had been revised to 16.5 per cent from 13.4 per cent originally.

 

The company has prepaid 2,050 debentures of Rs 1.000 Million each held by Axis Bank, the sole holder, after taking its consent and approval, the steel maker said in a BSE filing.

 

Essar Steel has a capacity of 14 million tonnes per annum with presence in India, Canada, the US, West Asia and Asia.

 

 

 

CMT REPORT (Corruption, Money Laundering & Terrorism]

 

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

 

1]         INFORMATION ON DESIGNATED PARTY

No records 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.60.16

UK Pound

1

Rs.102.23

Euro

1

Rs.82.04

 

 

INFORMATION DETAILS

 

Information Gathered by :

HNA

 

 

Analysis Done by :

SUB

 

 

Report Prepared by :

NTH

 

SCORE & RATING EXPLANATIONS

 

SCORE FACTORS

 

RANGE

POINTS

HISTORY

1~10

4

PAID-UP CAPITAL

1~10

4

OPERATING SCALE

1~10

3

FINANCIAL CONDITION

 

 

--BUSINESS SCALE

1~10

3

--PROFITABILIRY

1~10

3

--LIQUIDITY

1~10

3

--LEVERAGE

1~10

3

--RESERVES

1~10

3

--CREDIT LINES

1~10

3

--MARGINS

-5~5

--

DEMERIT POINTS

 

 

--BANK CHARGES

YES/NO

YES

--LITIGATION

YES/NO

YES

--OTHER ADVERSE INFORMATION

YES/NO

NO

MERIT POINTS

 

 

--SOLE DISTRIBUTORSHIP

YES/NO

NO

--EXPORT ACTIVITIES

YES/NO

NO

--AFFILIATION

YES/NO

YES

--LISTED

YES/NO

NO

--OTHER MERIT FACTORS

YES/NO

YES

DEFAULTER

 

 

--RBI

YES/NO

NO

--EPF

YES/NO

NO

 

 

 

TOTAL

 

29

 

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

 

 

 

 

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.