MIRA INFORM REPORT
|
Report No. : |
336592 |
|
Report Date : |
12.08.2015 |
IDENTIFICATION DETAILS
|
Name : |
SWARAJ ENGINES LIMITED |
|
|
|
|
Registered
Office : |
Phase-IV, Industrial Area, S.A.S. Nagar (Mohali) -
160055, Punjab |
|
Tel. No.: |
91-172-2234941 |
|
|
|
|
Country : |
India |
|
|
|
|
Financials (as
on) : |
31.03.2015 |
|
|
|
|
Date of
Incorporation : |
24.09.1985 |
|
|
|
|
Com. Reg. No.: |
16-006473 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs. 124.198 Million |
|
|
|
|
CIN No.: [Company Identification
No.] |
L50210PB1985PLC006473 |
|
|
|
|
IEC No.: |
1288036558 |
|
|
|
|
TAN No.: [Tax Deduction &
Collection Account No.] |
Not Available |
|
|
|
|
PAN No.: [Permanent Account No.] |
AACCS2990N |
|
|
|
|
Legal Form : |
A Public Limited Liability Company. The Company’s Shares are Listed on
the Stock Exchanges. |
|
|
|
|
Line of Business
: |
Manufacturer of Tractor Engines |
|
|
|
|
No. of Employees
: |
470 (Approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
A (62) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Exist |
|
|
|
|
Comments : |
Subject was incorporated in 1985 and it is in the business of
supplying engines to the Swaraj Division of Mahindra and Mahindra Limited. It
has a good track record. For the financial year ended 2015, the company’s sales turnover has
been declined to Rs. 5397.000 Million as compared to the previous year record
of Rs. 6082.8000 Million which further led to dip in profit of the company
during a year under a review. However, the rating takes into account of company’s financial risk
profile marked by large net worth base and zero borrowings of the company. Trade relations are reported as decent. Business is active. Payment terms
are reported to be regular. The company can be considered for business dealings at usual trade
terms and conditions. |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – March 31, 2015
|
Country Name |
Previous Rating (31.12.2014) |
Current Rating (31.03.2015) |
|
India |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
EXTERNAL AGENCY RATING
|
Rating Agency Name |
Not Available |
|
Rating |
Not Available |
|
Rating Explanation |
Not Available |
|
Date |
Not Available |
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
31-03-2013.
INFORMATION PARTED BY (GENERAL DETAILS)
|
Name : |
Mr. Vinod Sharma |
|
Designation : |
Account Department |
|
Contact No.: |
91-172-2234941 |
|
Date : |
11.08.2015 |
LOCATIONS
|
Registered Office : |
Phase-IV, Industrial Area, S.A.S. Nagar (Mohali) -
160055, Punjab |
|
Tel. No.: |
91-172-2234941 |
|
Fax No.: |
Not Available |
|
E-Mail : |
|
|
Website : |
|
|
Location : |
Owned |
|
|
|
|
Head Office : |
Plot No. 2, Industrial Phase IX, S.A.S. Nagar
(Mohali) - 160055, Punjab |
DIRECTORS
As on 31.03.2015
|
Name : |
Dr.
Pawan Goenka |
|
Designation : |
Director |
|
|
|
|
Name : |
Dr.
T.N.Kapoor |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr.
R.R.Deshpande |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr.
Vijay Varma |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr.
Rajan Wadhera |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr.
Subramaniam .Durgashankar |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr.
Dileep Chiubhai Choksi |
|
Designation : |
Director |
|
|
|
|
Name : |
Neera
Saggi |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. M.N.Kaushal |
|
Designation : |
Whole-time
Director |
KEY EXECUTIVES
|
Name : |
M.S. Grewal |
|
Designation : |
Company Secretary |
|
|
|
|
Name : |
Mr. Sudhir Mankad |
|
Designation : |
Chairman |
|
|
|
|
Name : |
Mr. Vinod Sharma |
|
Designation : |
Account Department |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 30.06.2015
|
Category of Shareholder |
Total
No. of Shares |
As a % |
|
(A) Shareholding of
Promoter and Promoter Group |
||
|
|
|
|
|
|
6286417 |
50.62 |
|
|
6286417 |
50.62 |
|
|
|
|
|
Total shareholding
of Promoter and Promoter Group (A) |
6286417 |
50.62 |
|
(B) Public
Shareholding |
||
|
|
|
|
|
|
1101459 |
8.87 |
|
|
11203 |
0.09 |
|
|
9290 |
0.07 |
|
|
843417 |
6.79 |
|
|
1965369 |
15.83 |
|
|
|
|
|
|
569062 |
4.59 |
|
|
|
|
|
|
2345500 |
20.06 |
|
|
874640 |
7.31 |
|
|
198619 |
1.60 |
|
|
140669 |
1.13 |
|
|
600 |
0.00 |
|
|
57350 |
0.46 |
|
|
3987821 |
33.56 |
|
Total Public
shareholding (B) |
5953190 |
49.38 |
|
Total (A)+(B) |
12239607 |
100.00 |
|
(C) Shares held by Custodians
and against which Depository Receipts have been issued |
|
|
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
|
0 |
0.00 |
|
Total (A)+(B)+(C) |
12239607 |
0.00 |
BUSINESS DETAILS
|
Line of Business : |
Manufacturer of Tractor Engines |
|
|
|
|
Products : |
Not Available |
|
|
|
|
Brand Names : |
Not Available |
|
|
|
|
Agencies Held : |
Not Available |
|
|
|
|
Exports : |
Not Divulged |
|
|
|
|
Imports : |
|
|
Products : |
Machinery |
|
Countries : |
|
|
|
|
|
Terms : |
|
|
Selling : |
Cash, Cheque and Credit (30/60/90 Days) |
|
|
|
|
Purchasing : |
Cash, Cheque and Credit (30/60/90 Days) |
PRODUCTION STATUS NOT AVAILABLE
GENERAL INFORMATION
|
Suppliers : |
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Customers : |
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No. of Employees : |
470 (Approximately) |
||||||||||||||||||||||
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|
||||||||||||||||||||||
|
Bankers : |
|
||||||||||||||||||||||
|
|
|
|
Auditors : |
|
|
Name : |
Davinder
S. Jaaj and Company Chartered Accountants |
|
Address : |
Chandigarh – 160017, Punjab, India |
|
|
|
|
Memberships : |
-- |
|
|
|
|
Collaborators : |
-- |
|
|
|
|
Associates : |
Mahindra
and Mahindra Limited |
CAPITAL STRUCTURE
As on 31.03.2015
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
25000000 |
Equity Shares |
Rs.10/- each |
Rs.250.000 Million |
|
|
|
|
|
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
12419820 |
Equity Shares |
Rs.10/- each |
Rs. 124.198
Million |
|
|
|
|
|
The Company has issued only one class of shares referred to as Equity Shares having a par value of Rs.10/-. Each Equity Shareholder is entitled to one vote per share.
The Company declares and pays dividend in Indian Rupees. The Board of Directors, in their meeting held on 27th April, 2015 proposed a dividend of Rs. 33.00 per equity share (including Rs 18.00 per share as special dividend). Dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. The total dividend appropriation for the year ended 31st March, 2015 amounted to Rs. 493.291 Million (2014 - Rs.508.570 Million) including corporate dividend tax of Rs. 83.437 Million (2014 - Rs.73.876 Million)
Equity Shareholders holding more than 5%
shares :
|
Name |
31.03.2015 |
|
|
|
No. of Shares Held |
% of Shareholding |
|
Mahindra & Mahindra Limited (M&M) |
41,26,417 |
33.22% |
|
Kirloskar Industries Limited (KIL) |
21,60,000 |
17.39% |
Reconciliation of number of Equity Shares
outstanding and the amount of Share Capital :
|
Description |
31.03.2015 |
|
|
|
No. of Shares |
Share Capital |
|
Number of equity shares at the beginning |
1,24,19,820 |
124.198 |
|
Movement in equity during the year |
-- |
-- |
|
Number
of equity shares at the closing |
1,24,19,820 |
124.198 |
In the last 5 years,
the Company has not :
– allotted any shares as fully paid up pursuant to contract(s) without payment being received in cash,
– allotted any bonus shares,
– bought back its shares.
FINANCIAL DATA
[all figures are
in Rupees Million]
ABRIDGED
BALANCE SHEET
|
SOURCES
OF FUNDS |
31.03.2015 |
31.03.2014 |
31.03.2013 |
|
|
|
|
|
|
I.
EQUITY AND LIABILITIES |
|
|
|
|
(1)Shareholders' Funds |
|
|
|
|
(a) Share Capital |
124.198 |
124.198 |
124.198 |
|
(b) Reserves & Surplus |
1996.543 |
1974.558 |
1813.088 |
|
(c) Money received against
share warrants |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
(2) Share Application money
pending allotment |
0.000 |
0.000 |
0.000 |
|
Total
Shareholders’ Funds (1) + (2) |
2120.741 |
2098.756 |
1937.286 |
|
|
|
|
|
|
(3) Non-Current Liabilities |
|
|
|
|
(a) long-term borrowings |
0.000 |
0.000 |
0.000 |
|
(b) Deferred tax liabilities
(Net) |
63.153 |
69.410 |
63.335 |
|
(c) Other long term
liabilities |
0.000 |
0.000 |
0.000 |
|
(d) long-term provisions |
21.736 |
17.838 |
12.645 |
|
Total
Non-current Liabilities (3) |
84.889 |
87.248 |
75.980 |
|
|
|
|
|
|
(4) Current Liabilities |
|
|
|
|
(a) Short term borrowings |
0.000 |
0.000 |
0.000 |
|
(b) Trade payables |
481.761 |
592.240 |
439.381 |
|
(c) Other current liabilities |
48.268 |
37.940 |
60.855 |
|
(d) Short-term provisions |
517.691 |
524.962 |
495.592 |
|
Total
Current Liabilities (4) |
1047.720 |
1155.142 |
995.828 |
|
|
|
|
|
|
TOTAL |
3253.350 |
3341.146 |
3009.094 |
|
|
|
|
|
|
II.
ASSETS |
|
|
|
|
(1) Non-current assets |
|
|
|
|
(a) Fixed Assets |
|
|
|
|
(i) Tangible assets |
837.688 |
839.437 |
806.561 |
|
(ii) Intangible Assets |
0.803 |
1.205 |
0.663 |
|
(iii) Capital work-in-progress |
47.827 |
17.324 |
24.563 |
|
(iv) Intangible assets under
development |
0.000 |
0.000 |
0.000 |
|
(b) Non-current Investments |
0.000 |
0.000 |
0.000 |
|
(c) Deferred tax assets (net) |
0.000 |
0.000 |
0.000 |
|
(d) Long-term Loan and Advances |
58.032 |
37.734 |
40.337 |
|
(e) Other Non-current assets |
0.000 |
0.000 |
0.000 |
|
Total
Non-Current Assets |
944.350 |
895.700 |
872.124 |
|
|
|
|
|
|
(2) Current assets |
|
|
|
|
(a) Current investments |
420.385 |
721.892 |
741.508 |
|
(b) Inventories |
331.415 |
464.068 |
393.468 |
|
(c) Trade receivables |
68.676 |
78.473 |
92.501 |
|
(d) Cash and cash equivalents |
1398.568 |
1048.851 |
807.150 |
|
(e) Short-term loans and
advances |
55.591 |
46.481 |
102.343 |
|
(f) Other current assets |
34.365 |
85.681 |
0.000 |
|
Total
Current Assets |
2309.000 |
2445.446 |
2136.970 |
|
|
|
|
|
|
TOTAL |
3253.350 |
3341.146 |
3009.094 |
PROFIT
& LOSS ACCOUNT
|
|
PARTICULARS |
31.03.2015 |
31.03.2014 |
31.03.2013 |
|
|
SALES |
|
|
|
|
|
Income |
5396.960 |
6082.773 |
4790.341 |
|
|
Other Income |
163.155 |
174.867 |
153.138 |
|
|
TOTAL
(A) |
5560.115 |
6257.640 |
4943.479 |
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
Cost of Materials Consumed |
4047.605 |
4656.903 |
3670.520 |
|
|
Changes in inventories of
finished goods, work-in-progress and Stock-in-Trade |
43.215 |
(34.257) |
(26.468) |
|
|
Employees benefits expense |
308.294 |
276.868 |
221.288 |
|
|
Other expenses |
250.705 |
276.882 |
210.063 |
|
|
Exceptional Item |
0.000 |
11.559 |
0.000 |
|
|
TOTAL
(B) |
4649.819 |
5187.955 |
4075.403 |
|
|
|
|
|
|
|
Less |
PROFIT/
(LOSS) BEFORE INTEREST, TAX,
DEPRECIATION AND AMORTISATION (C) |
910.296 |
1069.685 |
868.076 |
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
0.128 |
0.412 |
1.503 |
|
|
|
|
|
|
|
|
PROFIT
/ (LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
910.168 |
1069.273 |
866.573 |
|
|
|
|
|
|
|
Less/
Add |
DEPRECIATION/
AMORTISATION (F) |
131.992 |
91.158 |
71.558 |
|
|
|
|
|
|
|
|
PROFIT/ (LOSS)
BEFORE TAX (E-F) (G) |
778.176 |
978.115 |
795.015 |
|
|
|
|
|
|
|
Less |
TAX (H) |
259.760 |
308.075 |
241.000 |
|
|
|
|
|
|
|
|
PROFIT/ (LOSS)
AFTER TAX (G-H) (I) |
518.416 |
670.040 |
554.015 |
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD (K) |
369.900 |
281.515 |
267.000 |
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
Transfer to General Reserve |
0.000 |
70.000 |
60.000 |
|
|
Dividend |
83.400 |
73.800 |
409.900 |
|
|
Tax on Dividend |
409.900 |
434.700 |
69.600 |
|
|
Total
(M) |
493.300 |
578.500 |
539.500 |
|
|
|
|
|
|
|
|
Balance
Carried to the B/S (J+K+L-M) |
395.016 |
373.055 |
281.515 |
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
Raw Materials |
0.297 |
0.000 |
0.000 |
|
|
Components and Stores parts |
0.718 |
7.699 |
0.000 |
|
|
Capital Goods |
72.307 |
4.785 |
160.808 |
|
|
TOTAL
IMPORTS |
73.322 |
12.484 |
160.808 |
|
|
|
|
|
|
|
|
Earnings
/ (Loss) Per Share (Rs.) |
41.74 |
53.95 |
44.61 |
CURRENT MATURITIES OF LONG TERM DEBT DETAILS
|
Particulars |
31.03.2015 |
31.03.2014 |
31.03.2013 |
|
Current Maturities of Long term debt |
NA |
NA |
NA |
|
Cash generated from operations |
828.793 |
971.667 |
689.482 |
KEY
RATIOS
|
PARTICULARS |
|
31.03.2015 |
31.03.2014 |
31.03.2013 |
|
Net Profit Margin (PAT / Sales) |
(%) |
9.61 |
11.02 |
11.57 |
|
|
|
|
|
|
|
Operating Profit Margin (PBIDT/Sales) |
(%) |
16.87 |
17.59 |
18.12 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
24.28 |
29.43 |
26.64 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.37 |
0.47 |
0.41 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Debt /Networth) |
|
0.00 |
0.00 |
0.00 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
2.20 |
2.12 |
2.15 |
FINANCIAL ANALYSIS
[all figures are
in Rupees Million]
DEBT EQUITY RATIO
|
Particular |
31.03.2013 |
31.03.2014 |
31.03.2015 |
|
|
(Rs.
In Million) |
(Rs.
In Million) |
(Rs.
In Million) |
|
Share Capital |
124.198 |
124.198 |
124.198 |
|
Reserves & Surplus |
1813.088 |
1974.558 |
1996.543 |
|
Money received against share
warrants |
0.000 |
0.000 |
0.000 |
|
Share Application money pending allotment |
0.000 |
0.000 |
0.000 |
|
Net
worth |
1937.286 |
2098.756 |
2120.741 |
|
|
|
|
|
|
long-term borrowings |
0.000 |
0.000 |
0.000 |
|
Short term borrowings |
0.000 |
0.000 |
0.000 |
|
Total
borrowings |
0.000 |
0.000 |
0.000 |
|
Debt/Equity
ratio |
0.000 |
0.000 |
0.000 |
YEAR-ON-YEAR GROWTH
|
Year
on Year Growth |
31.03.2013 |
31.03.2014 |
31.03.2015 |
|
|
(Rs.
In Million) |
(Rs.
In Million) |
(Rs.
In Million) |
|
Sales |
4790.341 |
6082.773 |
5396.960 |
|
|
|
26.980 |
(11.275) |
NET PROFIT MARGIN
|
Net
Profit Margin |
31.03.2013 |
31.03.2014 |
31.03.2015 |
|
|
(Rs.
In Million) |
(Rs.
In Million) |
(Rs.
In Million) |
|
Sales |
4790.341 |
6082.773 |
5396.960 |
|
Profit |
554.015 |
670.040 |
518.416 |
|
|
11.57% |
11.02% |
9.61% |
LOCAL AGENCY FURTHER INFORMATION
|
Sr. No. |
Check list by
info agents |
Available in
Report (Yes/No) |
|
1 |
Year of establishment |
Yes |
|
2 |
Constitution of the entity -Incorporation
details |
Yes |
|
3 |
Locality of the entity |
Yes |
|
4 |
Premises details |
No |
|
5 |
Buyer visit details |
-- |
|
6 |
Contact numbers |
Yes |
|
7 |
Name of the person contacted |
Yes |
|
8 |
Designation of contact person |
Yes |
|
9 |
Promoter’s background |
No |
|
10 |
Date of Birth of Proprietor / Partners /
Directors |
No |
|
11 |
Pan Card No. of Proprietor / Partners |
No |
|
12 |
Voter Id Card No. of Proprietor / Partners |
No |
|
13 |
Type of business |
Yes |
|
14 |
Line of Business |
No |
|
15 |
Export/import details (if applicable) |
No |
|
16 |
No. of employees |
Yes |
|
17 |
Details of sister concerns |
Yes |
|
18 |
Major suppliers |
No |
|
19 |
Major customers |
No |
|
20 |
Banking Details |
Yes |
|
21 |
Banking facility details |
No |
|
22 |
Conduct of the banking account |
-- |
|
23 |
Financials, if provided |
Yes |
|
24 |
Capital in the business |
Yes |
|
25 |
Last accounts filed at ROC, if applicable |
Yes |
|
26 |
Turnover of firm for last three years |
Yes |
|
27 |
Reasons for variation <> 20% |
-- |
|
28 |
Estimation for coming financial year |
No |
|
29 |
Profitability for last three years |
Yes |
|
30 |
Major shareholders, if available |
Yes |
|
31 |
External Agency Rating, if available |
No |
|
32 |
Litigations that the firm/promoter
involved in |
Yes |
|
33 |
Market information |
-- |
|
34 |
Payments terms |
Yes |
|
35 |
Negative Reporting by Auditors in the
Annual Report |
No |
LITIGATION DETAIL:
|
HIGH COURT OF PUNJAB AND HARYANA |
|||||||
|
CASE DETAILS FOR CASE ITA-131-2004 |
|||||||
|
Dairy Number |
0 |
District |
UT-CHANDIGARH |
||||
|
Category |
96-STATUTORY APPEALS INCOME TAX |
Main Case Detail |
ITI-383-2004 |
||||
|
Party Detail |
THE COMMISSION OF INCOME RAX C/S M/S
SWARAJ ENGINES LIMITED |
||||||
|
Advocate Name |
A.S. TEWATIA |
LIST TYPE |
REGULAR |
||||
|
Status |
PENDING |
TAKENUP DATE |
- |
||||
|
MISCELLANEOUS APPLICATION |
|||||||
|
CM-16863CII-2005 |
IN ITA-131-2004 |
||||||
|
CM-16864-CII-2005 |
IN ITA-131-2004 |
||||||
|
|
|||||||
|
CASE LISTING DETAISL |
|||||||
|
CAUSE LIST DATE |
LIST TYPE SR. NO. |
BENCH |
ORDER LINK |
||||
|
02-Mar-2014 |
REGULAR:583 |
HON’BLE THE ACTING CHIEF JUSTICE:HON’BLE
MR. JUSTICE GURMEET SINGH SANDHAWALIA |
-- |
||||
|
08-AUG-2008 |
ORDINARY:202 |
HON’BLE MR. JUSTICE HEMANT GUPTA:HON’BLE
MR. JUSTICE RAJESHBINDAL |
-- |
||||
|
10-MAY-2005 |
ORDINARY:217 |
HON’BLE THE CHIEF JUSTICE:HON’BLE MR.
JUSTIVE HEMANT GUPTA |
-- |
||||
|
10-MAY-2005 |
ORDINARY:273 |
HON’BLE MR. JUSTICE NK.SUD;HON’BLE MR.
JUSTICE AJAY KUMAR MITTAL |
-- |
||||
REVIEW OF OPERATIONS
During the financial year 2014-15, the Company's engines sale stood at 64,595 units as against 74,062 units sold during the previous year. As the Company is supplying engines for the fitment in tractors, the business of the Company has been directly impacted by the significant drop witnessed in the domestic tractor industry during the second half of the fiscal 2015.
As a result of lower engines off takes, the net operating revenue for the year under review restricted to Rs. 5397.000 Million as compared to last year's Rs. 6082.800 million. While due focus on cost front has helped to restrict the overall costs but lower absorption of fixed expenses due to drop in volume coupled with higher depreciation and CSR expenses mandated by the provisions of the Companies Act, 2013, the profit before tax stood at Rs. 778.200 million (previous year Rs. 978.100 million). Profit After Tax of Rs. 518.400 million (previous year Rs. 670.000 million) translates into an Earning Per Share of Rs. 417.400 (previous year Rs. 539.500).
Taking note of the overall slowdown in tractor industry and its current scenario, the Company, by following a prudent approach, has decided to go little slow towards capacity enhancement project to increase the annual capacity to 1,05,000 units announced in January 2014, which is now expected to complete by end of second quarter of current fiscal instead of initial plan of first quarter of financial year 2015-16.
MANAGEMENT DISCUSSION
AND ANALYSIS
COMPANY PROFILE
Subject is manufacturing engines for fitment into "Swaraj" tractors being manufactured by Mahindra and Mahindra Limited (M&M) at its Swaraj Division. SEL is also supplying hi-tech engine components to SML Isuzu Limited., for assembly of commercial vehicle engines. Since start of commercial operations in 1989-90, SEL has supplied around 6,56,000 engines for fitment into "Swaraj" tractors.
INDUSTRY STRUCTURE
AND DEVELOPMENTS
Since the Company's principal business is to supply engines for tractors being manufactured by M&M-Swaraj Division, it would be appropriate to take note of developments in the tractor industry.
Indian tractor industry is one of the largest markets in the world in terms of sales volume despite having the low level of tractor penetration level compared to the world standards. Further, the penetration levels are also not uniform throughout the country and vary at state level. The domestic tractor market is traditionally segmented by horsepower - the low horsepower 20 HP – 30 HP segment, the mid segment of 30 HP - 40 HP and the higher segment of above 40 HP. Most of the major players cater to all the three segments. However, their relative strengths and market positions differ from segment to segment. The medium and higher HP segments are the most popular and fastest growing segments in the country. Further, to increase the tractor penetration in the lower segment of the market and to provide cost effective product, some of the industry players have also taken keen interest in below 20 HP category tractors.
The domestic tractor industry after registering a good growth of 20% during fiscal 2014 somehow lost its growth momentum during fiscal 2015. Subdued market conditions hit the tractor industry during FY 2014-15. While in the first half, it barely managed to sustain last year's volume, in the second half it witnessed a sharp decline of around 25% over same period of last year. Consequently, the year ended with overall degrowth of 13%. Lower crop output / yield, unseasonal rains and weak crop prices etc. had negatively impacted farm income and sentiments during the year. In addition, non-agri demand for tractors also remained sluggish during the year due to slow pick-up in infrastructure related activities.
OUTLOOK AND
OPPORTUNITIES
On the basis of current market trends, it is expected that the domestic tractor industry may register moderate growth in near term, however having regard to current penetration level, government's continuous thrust towards rural development, agrimechanization, generating rural employment opportunities through various schemes, scarcity of farm labour especially during the sowing season, shortened replacement cycle, healthy credit availability, expected higher momentum of infrastructural projects etc. would be the positive drivers for tractor industry in long term. In view of the optimistic industry outlook for the Company's prime customer, SEL's business prospects appear to remain positive.
THREATS, RISKS &
CONCERNS
As a supplier to M&M and SML Isuzu, SEL would be directly affected by factors impacting tractor industry and commercial vehicle industry. These would include issues like the rain-dependent nature of our agriculture, Government policy on procurement, credit availability, auto regulations, commodity price trends etc.
INDEX OF CHARGES:
|
S.No. |
Charge ID |
Date of Charge
Creation/Modification |
Charge amount
secured |
Charge Holder |
Address |
Service Request
Number (SRN) |
|
1 |
90177941 |
28/09/1998 |
9,000,000.00 |
CANARA BANK |
SECTOR 35-B, CHANDIGARH', Chandigarh, INDIA |
- |
|
2 |
90177940 |
04/05/1989 * |
4,700,000.00 |
THE INDUSTRIAL CREDIT & INVESTMENT CORPORATION
OF |
163; BACKBAY RECLAMATION, BOMBAY, Maharashtra - 40 |
- |
|
3 |
90177531 |
19/05/2003 * |
4,500,000.00 |
CANARA BANK |
SECTOR- 35-B, CHANDIGARH, CHANDIGARH, Chandigarh, |
- |
|
4 |
90177258 |
31/08/2000 * |
6,000,000.00 |
CANARA BANK |
SECTOR- 35-B, CHANDIGARH, CHANDIGARH, Chandigarh, |
- |
|
5 |
90181663 |
19/05/2003 * |
15,000,000.00 |
CANARA BANK |
SECTOR- 35-B, CHANDIGARH, CHANDIGARH, Chandigarh, |
- |
|
6 |
80025485 |
05/02/2007 * |
64,000,000.00 |
CANARA BANK |
SC0 :311-312, SECTOR 35-B, CHANDIGARH, Chandigarh |
- |
|
7 |
90177073 |
04/05/1989 * |
3,750,000.00 |
CANARA BANK |
SECTOR 35-B, CHANDIGARH', Chandigarh, INDIA |
- |
|
8 |
90177069 |
04/05/1989 * |
3,750,000.00 |
INDIAN BANK |
SECTOR 40, CHANDIGARH, Chandigarh, INDIA |
- |
|
9 |
90177039 |
04/05/1989 * |
12,500,000.00 |
INDUSTRIAL FINANCE CORPORATION OF INDIA |
BANK OF BARODA BUILDING, 16; SANSAD MARG, NEW DELHI, Delhi - 110001, INDIA |
- |
|
10 |
90177012 |
20/06/1988 |
6,750,000.00 |
INDUSTRIAL FINANCE CORPORATION OF INDIA LTD. |
BANK OF BARODA BUILDING, 16; SANSAD MARG, NEW DELHI, Delhi - 110001, INDIA |
- |
*Date of charge modification
CONTINGENT
LIABILITIES:
(Rs. in million)
|
PARTICULARS |
31.03.2015 |
31.03.2014 |
|
Claim
against the Company not acknowledged as debt |
|
|
|
Excise
matters in dispute |
10.159 |
12.761 |
|
Income
Tax matters in dispute |
22.839 |
24.365 |
|
Others |
24.167 |
24.167 |
FIXED ASSETS
- Land
- Buildings
- Electrical Installations
- Plant and Machinery
- Furniture and Fixtures
- Office Equipments
- Vehicles
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No exist to suggest that subject is or was
the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No available
information exist that suggest that subject or any of its principals have been
formally charged or convicted by a competent governmental authority for any
financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms and
conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.64.17 |
|
|
1 |
Rs.99.85 |
|
Euro |
1 |
Rs.70.36 |
INFORMATION DETAILS
|
Information Gathered
by : |
MNJ |
|
|
|
|
Analysis Done by
: |
HNA |
|
|
|
|
Report Prepared
by : |
ART |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
8 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILITY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
6 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
NO |
|
--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 |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
DEFAULTER |
|
|
|
--RBI |
YES/NO |
NO |
|
--EPF |
YES/NO |
NO |
|
TOTAL |
|
62 |
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.