MIRA INFORM REPORT
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Report No. : |
346180 |
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Report Date : |
20.10.2015 |
IDENTIFICATION DETAILS
|
Name : |
TATA CAPITAL FINANCIAL SERVICES LIMITED |
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Registered
Office : |
One Forbes, Dr. V. B. Gandhi Marg, Fort, Mumbai – 400001, Maharashtra |
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Tel. No.: |
91-22-66069000 |
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Country : |
India |
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Financials (as
on) : |
31.03.2014 |
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Date of
Incorporation : |
19.11.2010 |
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Com. Reg. No.: |
11-210201 |
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Capital
Investment / Paid-up Capital : |
Rs. 12975.500 Million |
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CIN No.: [Company Identification
No.] |
U67100MH2010PLC210201 |
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IEC No.: |
Not Available |
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TAN No.: [Tax Deduction &
Collection Account No.] |
MUMP08794C |
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PAN No.: [Permanent Account No.] |
AADCP9147C |
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Legal Form : |
A Closely Held Public Limited Liability Company |
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Line of Business
: |
Subject is a non-banking finance company which offers fund and fee-based financial services. |
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No. of Employees
: |
Information declined by the Management. |
RATING & COMMENTS
|
MIRA’s Rating : |
A (63) |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
56-70 |
A |
Financial & operational base are regarded healthy. General unfavorable
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums |
Fairly Large |
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Status : |
Good |
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Payment Behavior : |
Regular |
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Litigation : |
Exist |
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Comments : |
Tata Capital Financial Services Limited (“TCFSL”) is a subsidiary of
Tata Capital Limited. The company is registered with the Reserve Bank of
India as a Systemically Important Non Deposit Accepting Non-Banking Financial
Company (NBFC) and offers fund and fee-based financial services to its
customers, under the Tata Capital Brand.
Total revenue stood at Rs. 27831.200 Million as on March 31, 2014. In
FY14, net profit declined 38% to Rs. 1720.000 Million from Rs. 2760.000
Million for FY13. The rating reflect company’s strong parentage and brand equity
associated with the Tata Group, experienced management team drawn from parent
and strong financial flexibility enjoyed by company by virtue of being part
of Tata Group. However, rating is partially offsets due to high borrowings reported
by a company leading to moderate financial profile and moderate debt
protection metrics. Trade relations are reported as trustworthy. Payment terms are
reported to be regular and as per commitment. In view of strong brand image in the market and part of “Tata Group”,
the company can be considered good for business dealing 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.
EXTERNAL AGENCY RATING
|
Rating Agency Name |
CARE |
|
Rating |
Long term Bank Facilities : AA |
|
Rating Explanation |
High degree of safety and very low credit risk. |
|
Date |
February, 10, 2015 |
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
31-03-2015.
INFORMATION DENIED
MANAGEMENT NON-COOPERATIVE
Contact No: 91-22-67459000/91-22-61828282
LOCATIONS
|
Registered Office : |
One Forbes, Dr. V. B. Gandhi Marg, Fort, Mumbai – 400001, Maharashtra,
India |
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Tel. No.: |
91-22-66069000 |
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Fax No.: |
91-22-66106722 |
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E-Mail : |
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Website : |
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Branch Office 1/ Retail
Service Center 1 : |
TC No: 9, 2284 (3), Ground Floor, Cheruvilakom Buildings, Near NSS Karayogam, Sasthamangalam, Trivandrum – 695010, Kerala, India |
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Branch Office 2: |
Located at:
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Retail Service
Centers 2 : |
Located at:
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DIRECTORS
AS ON 30.06.2014
|
Name : |
Mr. Farokh Nariman Subedar |
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Designation : |
Director |
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Address : |
1, Wadia Building, 6 Babulnath Road, Mumbai – 400007, Maharashtra,
India |
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Date of Birth/Age : |
24.09.1955 |
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Date of Appointment : |
26.03.2011 |
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DIN No.: |
00028428 |
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Name : |
Mr. Praveen Purshottam Kadle |
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Designation : |
Managing Director |
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Address : |
224, NCPA Apartment, Nariman Point, Mumbai – 400021, Maharashtra,
India |
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Date of Birth/Age : |
21.01.1957 |
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Date of Appointment : |
19.11.2010 |
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DIN No.: |
00016814 |
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Name : |
Mrs. Janki Amarnath Ballabh |
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Designation : |
Director |
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Address : |
Flat No.605, Versova Vinayak CHS., Near Versova, Telephone Exchange,
Versova, Andheri (West), Mumbai – 400053, Maharashtra, India |
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Date of Birth/Age : |
24.10.1942 |
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Date of Appointment : |
26.03.2011 |
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DIN No.: |
00011206 |
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Name : |
Mr. Pranab Kumar Choudhury |
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Designation : |
Director |
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Address : |
Flat No.2, Souther Court, 64, Jodhpur Park, Kolkata - 700068, West Bengal, India |
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Date of Appointment : |
28.01.2015 |
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DIN No.: |
00015470 |
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Name : |
Mr. Mukund Sadashiv Dharmadhikari |
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Designation : |
Director |
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Address : |
A 43-02, Bellissimo, N M Joshi Marg, Mahalaxmi, Mumbai - 400011, Maharashtra, India |
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Date of Appointment : |
28.01.2015 |
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DIN No.: |
05003224 |
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Name : |
Ms. Anuradha Eknath Thakur |
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Designation : |
Director |
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Address : |
B-7, 3rd Floor, Bageshree Shankar Ghanekar Mrg, Prabhadevi, Mumbai - 400025, Maharashtra, India |
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Date of Appointment : |
28.01.2015 |
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DIN No.: |
06702919 |
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Name : |
Mr. Madhusudan Vasudevan Kannan |
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Designation : |
Additional Director |
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Address : |
502, Suraj Prakash CHS, 86 S Ghanekar Marg, Prabhadevi, Mumbai - 400025, Maharashtra, India |
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Date of Appointment : |
28.01.2015 |
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DIN No.: |
02647756 |
KEY EXECUTIVES
|
Name : |
Mr. Puneet Mahendra Sharma |
|
Designation : |
Chief Financial Officer |
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Address : |
191, Centrum Towers A, Barkat Ali Road, Near Wadala Flyover, Wadala (East), Mumbai - 400037, Maharashtra, India |
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PAN No : |
AUFPS4394G |
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Date of Appointment : |
09.05.2014 |
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Name : |
Mr. Avan Kayomars Doomasia |
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Designation : |
Secretary |
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Address : |
602-C, Indu Villa, Lady Jehangir Road, Matunga (East), Mumbai - 400019, Maharashtra, India |
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PAN No : |
AAAPD3599F |
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Date of Appointment : |
27.03.2012 |
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Name : |
Amar Sinhji |
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Designation : |
Head - Human Resources |
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Name : |
Amit Joshi |
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Designation : |
Vice President - Risk ( Infrastructure Finance) |
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Name : |
Avijit Bhattacharya |
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Designation : |
Head-Cleantech Finance business |
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Name : |
Deepabh Jain |
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Designation : |
Head - Cards Business |
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Name : |
Deepak Shimpi |
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Designation : |
Head - Risk |
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Name : |
Devdatta Roy |
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Designation : |
Head - Infrastructure and Networking |
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Name : |
Gautam Mudbhatkal |
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Designation : |
Chief Information Officer - Information Technology |
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Name : |
Govind Sankaranarayanan |
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Designation : |
Chief Financial Officer and Chief Operating Officer - Corporate Affairs |
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Name : |
Jayakumar Ganesan |
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Designation : |
Head Collections - Infrastructure Finance |
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Name : |
Kamlesh Parekh |
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Designation : |
Head - Legal and Compliance |
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Name : |
Karnail Singh Kalra |
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Designation : |
Head - Tractor Finance (Tractor Business) |
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Name : |
Kashmira Mewawala |
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Designation : |
Head - Business Development |
MAJOR SHAREHOLDERS
AS ON 30.06.2014
|
Names of Shareholders |
No. of Shares |
|
Tata Capital Limited, India |
1297549994 |
|
Tata Capital Limited, India Jointly With Kadle Purushottam Praveen |
1 |
|
Tata Capital Limited, India Jointly With Rajadhyaksha Harishchandra
Shailesh |
1 |
|
Tata Capital Limited, India Jointly With Sankaranarayanan
Mambalikalath Govind |
1 |
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Tata Capital Limited, India Jointly With Joshi Krishna Kiran |
1 |
|
Tata Capital Limited, India Jointly With Doomasia Kayomars Avan |
1 |
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Tata Capital Limited, India Jointly With Bhatia Jagdish Rakesh |
1 |
|
Total |
1297550000 |
Equity Share Break up (Percentage of Total Equity)
AS ON 30.06.2014
|
Category |
Percentage |
|
Bodies corporate |
100.00 |
|
Total |
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Subject is a non-banking finance company which offers fund and fee-based financial services. |
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Services: |
Financial Services |
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Brand Names : |
Not Available |
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Agencies Held : |
Not Available |
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Exports : |
Not Divulged |
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Imports : |
Not Divulged |
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Terms : |
Not Divulged |
PRODUCTION STATUS: NOT AVAILABLE
GENERAL INFORMATION
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Suppliers : |
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Customers : |
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No. of Employees : |
Information declined by the Management |
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Bankers : |
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Facilities : |
NOTE Long-term
Borrowings Privately Placed
Non-Convertible Debentures are secured by pari passu charge on the specific
immovable property, specified receivables arising out of loan, lease, hire
purchase transactions and to the extent of shortfall in asset cover by a pari
passu charge on the current assets of the Company. Public issue of
Non-Convertible Debentures are secured by a pari passu charge on the specific
immovable property, receivables against unsecured loans, bills discounted and
trade advances and other current assets of the Company. Loans and advances from
banks are secured by pari passu charge on the current assets of the Company. Terms
of repayment of term loans and other loans: As per terms of
agreements, Loan from banks and others includes Rs. 46750.000 Million
(Previous Year: Rs. 40000.000 Million) repayable at maturity ranging between
12 and 36 months from the date of respective loan. Short-term
borrowings Terms of repayment of
term loans and other loans: – Loan from banks and
other includes Rs. 6500.000 Million (Previous Year: Rs. 4000.000 Million)
repayable on demand. Discount
on Commercial Paper varies between 7.94% to 12.00% |
|
Financial
Institutions |
IL and FS Trust Company Limited, Il & Fs Financial Centre, Plot No. C22, G Block Bandra Kurla Complex, Bandra (East), Mumbai – 400051, Maharashtra, India |
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Auditors : |
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Name : |
Delloite Haskins and Sells LLP Chartered Accountants |
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Address : |
Indiabulls Finance Centre, 32nd Floor, Tower 3, Senapati Bapat Marg,
Elphinstone (West), Mumbai – 400013, Maharashtra, India |
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PAN No.: |
AACFD4815A |
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Memberships : |
Not Available |
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Collaborators : |
Not Available |
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Ultimate Holding
Company: |
Tata Sons Limited |
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Holding Company : |
Tata Capital Limited [U65990MH1991PLC060670] |
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Fellow Subsidiaries
(with which the company had transactions) : |
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Subsidiaries of ultimate
holding company (with which the company had transactions) : |
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Associates : |
International Asset Reconstruction Company Private Limited (w.e.f. July 7, 2013) |
CAPITAL STRUCTURE
AFTER 30.06.2014
Authorised Capital : Rs.
30000.000 Million
Issued, Subscribed & Paid-up Capital : Rs. 12975.500 Million
AS ON 30.06.2014
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
250,00,00,000 |
Equity Shares |
Rs.10/- each |
Rs. 25000.000 Million |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
129,75,50,000 |
Equity Shares |
Rs.10/- each |
Rs. 12975.500 Million |
FINANCIAL DATA
[all figures are
in Rupees Million]
ABRIDGED
BALANCE SHEET
|
SOURCES OF FUNDS |
31.03.2014 |
31.03.2013 |
31.03.2012 |
|
|
|
|
|
|
I.
EQUITY AND LIABILITIES |
|
|
|
|
(1)Shareholders' Funds |
|
|
|
|
(a) Share Capital |
12975.500 |
12975.500 |
12975.500 |
|
(b) Reserves &
Surplus |
18927.800 |
17965.600 |
15656.800 |
|
(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) |
31903.300 |
30941.100 |
28632.300 |
|
|
|
|
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(3) Non-Current
Liabilities |
|
|
|
|
(a) long-term borrowings |
79603.600 |
72694.100 |
84720.700 |
|
(b) Deferred tax
liabilities (Net) |
0.000 |
0.000 |
0.000 |
|
(c) Other long term
liabilities |
615.600 |
1258.600 |
1199.500 |
|
(d) long-term provisions |
295.900 |
285.800 |
253.000 |
|
Total Non-current
Liabilities (3) |
80515.100 |
74238.500 |
86173.200 |
|
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|
|
|
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(4) Current Liabilities |
|
|
|
|
(a) Short term borrowings |
63388.200 |
58001.200 |
49859.600 |
|
(b) Trade payables |
2437.100 |
2566.300 |
2648.600 |
|
(c) Other current
liabilities |
52995.500 |
49197.100 |
32736.100 |
|
(d) Short-term provisions |
1340.200 |
1272.900 |
466.300 |
|
Total Current Liabilities
(4) |
120161.000 |
111037.500 |
85710.600 |
|
|
|
|
|
|
TOTAL |
232579.400 |
216217.100 |
200516.100 |
|
|
|
|
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II.
ASSETS |
|
|
|
|
(1) Non-current assets |
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|
|
|
(a) Fixed Assets |
|
|
|
|
(i) Tangible assets |
3631.900 |
2511.800 |
2400.300 |
|
(ii) Intangible Assets |
801.500 |
780.800 |
782.500 |
|
(iii) Capital
work-in-progress |
8.800 |
15.200 |
80.700 |
|
(iv) Intangible assets
under development |
0.000 |
25.900 |
25.900 |
|
(b) Non-current
Investments |
9059.700 |
11244.700 |
13375.700 |
|
(c) Deferred tax assets
(net) |
756.000 |
523.100 |
406.400 |
|
(d) Long-term Loan and Advances - Financing
Activity |
91254.900 |
88288.900 |
81747.600 |
|
(e) Loan and Advances - Others |
1409.800 |
940.400 |
523.200 |
|
(f) Other Non-current
assets |
498.200 |
480.900 |
557.900 |
|
Total Non-Current Assets |
107420.800 |
104811.700 |
99900.200 |
|
|
|
|
|
|
(2) Current assets |
|
|
|
|
(a) Current investments |
6359.900 |
4563.600 |
6115.500 |
|
(b) Inventories |
0.000 |
0.000 |
0.000 |
|
(c) Trade receivables |
36.200 |
38.100 |
25.900 |
|
(d) Cash and cash
equivalents |
2601.300 |
2044.200 |
304.200 |
|
(e) Short-term loans and
advances - Financing Activity |
113832.800 |
102342.900 |
90941.100 |
|
(f) Loans and advances -
Others |
1370.700 |
1591.900 |
1893.200 |
|
(g) Other current assets |
957.700 |
824.700 |
1336.000 |
|
Total Current Assets |
125158.600 |
111405.400 |
100615.900 |
|
|
|
|
|
|
TOTAL |
232579.400 |
216217.100 |
200516.100 |
PROFIT
& LOSS ACCOUNT
|
|
PARTICULARS |
31.03.2014 |
31.03.2013 |
31.03.2012 |
|
|
SALES |
|
|
|
|
|
Income |
24871.200 |
23734.700 |
18858.900 |
|
|
Investment Income |
1838.700 |
2445.000 |
2445.400 |
|
|
Other Income |
1121.300 |
828.900 |
752.900 |
|
|
TOTAL |
27831.200 |
27008.600 |
22057.200 |
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
Employees benefits
expense |
1876.500 |
1677.200 |
1514.400 |
|
|
Amortisation expenses |
95.000 |
91.800 |
196.100 |
|
|
Other Operating expenses |
5559.300 |
4175.700 |
3406.100 |
|
|
TOTAL |
7530.800 |
5944.700 |
5116.600 |
|
|
|
|
|
|
|
|
PROFIT/ (LOSS) BEFORE INTEREST, TAX, DEPRECIATION AND
AMORTISATION |
20300.400 |
21063.900 |
16940.600 |
|
|
|
|
|
|
|
Less |
FINANCIAL EXPENSES |
16900.400 |
16400.900 |
13990.200 |
|
|
|
|
|
|
|
|
PROFIT / (LOSS) BEFORE
TAX, DEPRECIATION AND AMORTISATION |
3400.000 |
4663.000 |
2950.400 |
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION |
591.700 |
435.900 |
367.300 |
|
|
|
|
|
|
|
|
PROFIT/ (LOSS) BEFORE TAX |
2808.300 |
4227.100 |
2583.100 |
|
|
|
|
|
|
|
Less |
TAX |
1087.000 |
1465.900 |
895.800 |
|
|
|
|
|
|
|
|
PROFIT/ (LOSS) AFTER TAX
|
1721.300 |
2761.200 |
1687.300 |
|
|
|
|
|
|
|
Add |
PREVIOUS YEARS’ BALANCE
BROUGHT FORWARD |
1126.000 |
0.100 |
0.100 |
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
Transfer to General
Reserve |
0.000 |
0.000 |
0.000 |
|
|
Special Reserve Account |
350.000 |
552.300 |
337.300 |
|
|
Debenture Redemption
Reserve |
0.000 |
630.600 |
1350.000 |
|
|
Interim Dividend on
equity shares |
650.000 |
389.300 |
0.000 |
|
|
Dividend Distribution tax |
110.000 |
63.100 |
0.000 |
|
|
|
|
|
|
|
|
BALANCE CARRIED TO THE
B/S |
1737.300 |
1126.000 |
0.100 |
|
|
|
|
|
|
|
|
Earnings / (Loss) Per
Share (Rs.) |
1.33 |
2.13 |
1.69 |
CURRENT MATURITIES
OF LONG TERM DEBT DETAILS
|
Particulars |
31.03.2014 |
31.03.2013 |
31.03.2012 |
|
Current
Maturities of Long term debt |
|
|
|
|
(i)
Bonds/Debentures |
|
|
|
|
Privately Placed Non-Convertible Debentures [Net of unamortised discount of Rs. 45.800 Million (as at March 31, 2013: Rs. 167.100 Million)] |
27117.200 |
17961.900 |
6149.300 |
|
Public issue of Non-Convertible Debentures |
0.000 |
6050.200 |
9464.800 |
|
(ii) Term Loans |
|
|
|
|
From Banks – Secured |
18750.000 |
13500.000 |
13392.900 |
|
From Banks – Unsecured |
1000.000 |
6500.000 |
0.000 |
|
Total |
46867.200 |
44012.100 |
29007.000 |
|
Cash used in operations |
(8625.400) |
(8165.000) |
(43570.300) |
|
Net Cash Used In Operating Activities |
(10273.400) |
(9456.100) |
(44510.100) |
KEY
RATIOS
|
PARTICULARS |
|
31.03.2014 |
31.03.2013 |
31.03.2012 |
|
Net Profit Margin (PAT / Sales) |
(%) |
6.92 |
11.63 |
8.95 |
|
|
|
|
|
|
|
Operating Profit Margin (PBIDT/Sales) |
(%) |
81.62 |
88.75 |
89.83 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
1.27 |
2.08 |
1.39 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.09 |
0.14 |
0.09 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Debt /Networth) |
|
5.95 |
5.65 |
5.71 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.04 |
1.00 |
1.17 |
FINANCIAL ANALYSIS
[all figures are
in Rupees Million]
DEBT EQUITY RATIO
|
Particular |
31.03.2012 |
31.03.2013 |
31.03.2014 |
|
|
(Rs. In Million) |
(Rs. In Million) |
(Rs. In Million) |
|
Share Capital |
12975.500 |
12975.500 |
12975.500 |
|
Reserves & Surplus |
15656.800 |
17965.600 |
18927.800 |
|
Share Application money
pending allotment |
0.000 |
0.000 |
0.000 |
|
Net worth |
28632.300 |
30941.100 |
31903.300 |
|
|
|
|
|
|
long-term borrowings |
84720.700 |
72694.100 |
79603.600 |
|
Short term borrowings |
49859.600 |
58001.200 |
63388.200 |
|
Current Maturities of
Long Term Debt |
29007.000 |
44012.100 |
46867.200 |
|
Total borrowings |
163587.300 |
174707.400 |
189859.000 |
|
Debt/Equity ratio |
5.713 |
5.646 |
5.951 |
YEAR-ON-YEAR GROWTH
|
Year on Year Growth |
31.03.2012 |
31.03.2013 |
31.03.2014 |
|
|
(Rs. In Million) |
(Rs. In Million) |
(Rs. In Million) |
|
Sales |
18858.900 |
23734.700 |
24871.200 |
|
|
|
25.854 |
4.788 |
NET PROFIT MARGIN
|
Net Profit Margin |
31.03.2012 |
31.03.2013 |
31.03.2014 |
|
|
(Rs. In Million) |
(Rs. In Million) |
(Rs. In Million) |
|
Sales |
18858.900 |
23734.700 |
24871.200 |
|
Profit |
1687.300 |
2761.200 |
1721.300 |
|
|
8.95% |
11.63% |
6.92% |
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 |
No |
|
8 |
Designation of contact person |
No |
|
9 |
Promoter’s background |
No |
|
10 |
Date of Birth of Proprietor / Partners /
Directors |
Yes |
|
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 |
Yes |
|
15 |
Export/import details (if applicable) |
No |
|
16 |
No. of employees |
No |
|
17 |
Details of sister concerns |
Yes |
|
18 |
Major suppliers |
No |
|
19 |
Major customers |
No |
|
20 |
Banking Details |
No |
|
21 |
Banking facility details |
Yes |
|
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 |
Yes |
|
32 |
Litigations that the firm/promoter
involved in |
Yes |
|
33 |
Market information |
--- |
|
34 |
Payments terms |
No |
|
35 |
Negative Reporting by Auditors in the
Annual Report |
No |
LITIGATION
DETAILS:
|
LITIGATION DETAILS |
||||||
|
Bench:- Bombay |
||||||
|
Lodging No:- |
APPL/204/2015 |
Filing Date: |
18.02.2015 |
|||
|
|
Main Matter |
|||||
|
Lodging No:- |
ARBPL/1885/2013 |
Reg No:- |
ARBP/632/2014 |
|||
|
Petitioner:- |
JAI HIND PROJECTS LIMITED AND 2 ORS |
Respondent:- |
TATA CAPITAL FINANCIAL SERVICES LIMITED |
|||
|
Petn.Adv:- |
PRAKASH M KUMAR (I10468) |
Resp. Adv.: |
----- |
|||
|
District:- |
MUMBAI |
|||||
|
Bench:- |
DIVISION |
Category:- |
APPEAL (FINAL JUDGMENT/DEGREE-ARBP/ARBAP) |
|||
|
Status:- |
Pre-Admission |
Stage:- |
TRANSFERRED TO CITYCIVIL COURT, BOMBAY |
|||
|
Last Date:- |
25.02.2015 |
|||||
|
Last Coram:- |
REGISTRAR(OS)/PROTHONOTARY AND SR. MASTER |
|||||
|
|
|
|||||
|
Act : |
Arbitration and Conciliation Act 1996 |
Under Section : |
9 |
|||
UNSECURED LOAN
|
PARTICULARS |
31.03.2014 (Rs.
in Million) |
31.03.2013 (Rs.
in Million) |
|
Long-term
Borrowings |
|
|
|
"Non-Convertible
Subordinated Debentures [Net
of unamortised discount of Rs. 240.600 Million (as at March 31, 2013
: Rs. 271.000 Million)] |
8813.900 |
8783.500 |
|
Non-Convertible
Perpetual Debentures |
1000.000 |
64.500 |
|
Term
loans |
|
|
|
From
Banks |
3000.000 |
1000.000 |
|
Deposits |
|
|
|
Inter
Corporate Deposit from Related Parties |
800.000 |
0.000 |
|
Short-term
borrowings |
|
|
|
Loans
repayable on demand |
|
|
|
Working
capital loan repayable on demand |
220.000 |
0.000 |
|
Bank
Overdraft |
0.000 |
2000.000 |
|
Other
loans and advances |
|
|
|
Term
Loans From Banks |
2000.000 |
1000.000 |
|
Commercial paper [Net of unamortised
discount of Rs. 725.700 Million (as at March 31, 2013 : Rs. 457.000 Million)] |
26559.800 |
26423.000 |
|
Inter
Corporate Deposits from Related Parties |
3309.000 |
20.000 |
|
Inter
Corporate Deposits from Others |
71.500 |
71.500 |
|
Total |
45774.200 |
39362.500 |
BACKGROUND
Subject is a wholly owned subsidiary of Tata Capital Limited (“TCL”) and a Systemically Important Non Deposit Accepting Non Banking Finance Company (“NBFC”), holding a Certificate of Registration from the Reserve Bank of India (“RBI”) received on November 4, 2011.
TCFSL is headquartered in Mumbai and has a wide network of approximately 115 offices across India.
INDUSTRY AND ECONOMIC
SCENARIO
India is in transition and if it desires to regain its position as a leading emerging market investment destination, clarity and consistency of policy action is paramount. The election results hold the key. In anticipation, the equity markets have created an all time high and currency markets are buoyant. However, investors, private and foreign, will wait for stability of governance and policy action before committing long term capital to the country. At its core, India is facing a difficult economic situation on the growth, asset quality, inflation and fiscal deficit fronts. Growth is estimated to have bottomed, but recovery is predicated upon clarity of policy matters and decision making by the Government, both factors out of the control of private enterprise. Slower growth has translated into asset quality issues for the banking sector. Gross non performing loans have risen to 3.6% in FY 2013-14 from 2.5% in FY 2012-13, which may have been acceptable, given the capital requirements of Indian banks. However, if one includes restructured assets currently at 9.4%, the asset quality issue is a real concern. Inflation may have peaked out, but structural factors, especially on the food front, need to be adequately tackled. Monsoons will clearly be a variable in FY 2014-15, given the various predictions of a below par monsoon. Lastly, on the fiscal deficit, targets have been met, but many constituents continue to question the quality and means of this achievement.
The RBI and the Government have taken notable steps in FY 2013-14 to address the economic headwinds. The Government formed the Project Management Group to facilitate large projects, undertook actions on power tariffs, gas price and continued diesel price increases. The RBI initiated efforts at recognizing and cleaning up Non-Performing Assets (“NPA”). On the policy front, it introduced a shift in focus to Consumer Price Inflation (CPI) from Wholesale Price Inflation (WPI), and a move towards inflation targeting. If implemented correctly and in a time bound manner, these collectively have the ability to create a meaningful impact on the economy.
The Government’s first GDP estimate for FY 2013-14 estimates growth at 4.9%, largely in line with market expectations. The Interim budget which was the last budget of the UPA-II Government was “not” biased towards populist measures but focused on growth measures, like reduction in excise duties on capital and consumer goods and maintaining the fiscal deficit target within limits. The key to a higher growth would be reviving investments (initially by revival of stalled projects), especially in the private sector and higher domestic savings, especially financial savings, by containing inflation and positive real return.
Debt in the private sector has risen despite India’s total debt (private and public) remaining at approximately 139% of GDP, in line with the last 10 years’ average. Rising private-sector debt coupled with repayments to the tune of approximately US$20 bn annually make the economy vulnerable to international capital flows. Though the real economy is largely domestic oriented, given its dependence on capital flows, India is open to exchange volatility and its related pitfalls.
On the global front, the Federal Reserve reduced its monthly asset purchases with the last reduction for FY 2013 14 being made in February 2014. The monthly purchases are down to US$ 65bn (US$ 35 bn Treasury + US$ 30 bn Mortgage Backed Securities). Global observers expect the tapering to continue in the coming months, leading to a complete wind down by end of Q2 2014-15.
The year ahead will be challenging on the interest rate and credit quality front, however, if India votes a stable Government, we could see an improvement in asset quality and return growth.
BUSINESS SEGMENT
The Company’s reportable segments consist of Financing Activity and Others. The Financing Activity segment consists of asset financing, term loans (corporate and retail), channel financing and bill discounting. Others segment primarily includes corporate investments, treasury activities, advisory services, wealth management, distribution of financial products.
FINANCIAL RESULTS
During the year, the Company’s average book size increased by 6% from Rs. 187860.000 Million in FY 2012-13 to Rs. 197340.000 Million in FY 2013-14. Gross Income increased from Rs. 27010.000 Million in the Previous Year to Rs. 27830.000 Million recording an increase of 3%.The Company’s Profit Before Tax was Rs. 2810.000 Million (Previous Year: Rs. 4230.000 Million) and the Profit After Tax for FY 2013-14 decreased by 38%, due to non recurring investment impairment and credit costs and, stood at Rs. 1720.000 Million (Previous Year: Rs. 2760.000 Million).
The Gross and Net NPAs were 4.52% and 3.68% in FY 2013-14, respectively as compared to 2.31% and 1.72%, in FY 2012-13. As at March 31, 2014, the Company had Fee to Income Ratio of 23% (Previous Year: 21%) and Cost to Income Ratio of 47.8% (Previous Year: 45%). The Return on Asset and Return on Equity ratio as at March 31, 2014, was at 0.9% and 5.4%, respectively as against 1.4% and 9.2%, as at March 31, 2013.
During FY 2013-14, no amount was required to be transferred to the Company’s Debenture Redemption Reserve (“DRR”) since, as at March 31, 2014, the DRR balance stood at Rs. 3000.000 Million, which was in excess of the limits prescribed under the Companies Act, 1956, for maintaining DRR by NBFCs on its debentures issued to the Public.
A provision of Rs. 31.600 Million (Previous Year: Rs. 49.500 Million), at the rate of 0.25% of standard assets was made in FY 2013-14, pursuant to RBI’s Circular dated January 17, 2011 which requires a Provision of 0.25% to be made for standard assets of NBFCs.
An amount of Rs. 344.300 Million (Previous Year: Rs. 552.300 Million), being 20% of the profits, was transferred to Special Reserve Account as required under Section 45 IC of the Reserve Bank of India Act, 1934.
REVIEW OF OPERATIONS
OF THE COMPANY
Corporate Finance
The Corporate Finance Division (“CFD”) has three broad business segments viz. Commercial Finance, Infrastructure Finance and Leasing Finance. The Closing Book stood at Rs. 148940.000 Million (FY 2012-13: Rs. 141890.000 Million), comprising Commercial Finance of Rs. 89740.000 Million (60.2%), Infrastructure Finance of Rs. 57170.000 Million (38.4%) and Leasing Finance of Rs. 2030.000 Million (1.4%).
Commercial Finance:
The Commercial Finance Division specializes in product offerings ranging from vanilla term loans, working capital term loans, channel finance, bill discounting, equipment financing, lease rental discounting and promoter funding through structured products. The Division has a strong focus on debt syndications and direct lending through its four business verticals viz. large corporates, mid-size corporates, supply chain finance and emerging markets including equipment finance. Despite low credit growth due to the very challenging business environment, the Division ended FY 2013-14 with a book of Rs. 89740.000 Million as compared to Rs. 80850.000 Million at the end of FY 2012-13. This Division has disbursed fresh loans of Rs. 264910.000 Million during FY 2013-14 (FY 2012-13: Rs. 237250.000 Million) through more than eight product offerings and earned a total fee income of Rs. 657.000 Million. The four verticals of the Division viz. large corporates, mid -size corporates, supply chain, trade finance and small and emerging markets including equipment finance, catering to all customer segments, contributed to 30.4%, 21.5%, 44.7% and 3.4% of the total book, respectively. The Division is committed towards providing complete financial solutions to corporates, through different innovative products which give value to its customers and simultaneously grow a quality asset portfolio.
Infrastructure
Finance:
The Infrastructure Finance Division has three main lines of business viz. Construction Equipment Finance, Project Finance and Equipment Rentals.
In view of the subdued macroeconomic environment, the companies operating in the Infrastructure space faced a difficult situation. The Infrastructure segment, as a whole, was also adversely affected by regulatory issues and delayed payment from government bodies. These challenges also had an impact on the Company, resulting in reduced disbursement levels as compared to FY 2012-13 and stress on the portfolio quality. Considering these challenges, the Company has been more cautious in its disbursements and has been trying to maintain the asset quality.
During FY 2013-14, the Construction Equipment Finance Division continued to be amongst the top five players in the industry. While Project Finance business worked with caution in view of the slowdown, the Division’s equipment rental business has now stabilized. During FY 2013-14, the Division disbursed fresh loans of Rs. 24250.000 Million (FY 2012-13: Rs. 34030.000 Million) and closed the financial year with a book of Rs. 57170.000 Million as against (Rs. 61050.000 Million in FY 2012-13), a decrease in the book size by 6%.
The Division has now started considering funding opportunities in the non renewable energy segment and other infrastructure projects where the construction period risk is over. In the case of Construction Equipment Finance, focus is on Rural and Semi Urban markets. Considering the tough economic environment, collections and credit monitoring activities have been strengthened.
Leasing Finance:
During the last quarter of FY 2012-13, the Company forayed into the leasing business and has successfully made inroads into equipment leasing, through strategic Vendor Programs, with some leading and prominent players in the Information Technology, Transportation and Capital Goods Manufacturing sectors. The Division also sources its leads through the Commercial and Infrastructure Finance Divisions. The Leasing Division sanctioned facilities of over Rs. 2300.000 Million and as at March 31, 2014, its Book stood at approximately Rs. 2030.000 Million, comprising reputed clientele from multinationals and large and mid-size corporate segments.
Leasing is one of the most dynamic products in the Asset Finance business and largely appeals to corporates which are conscious of asset life cycle and total cost of usage of assets. With its comprehensive solutions approach, the Leasing Division is expected to be one of the key business units of CFD.
Consumer Finance
Through the Consumer Finance and Advisory Business (“CFAB”), the Company offers a wide range of consumer loans such as Auto Loans (Car and Two Wheeler), Commercial Vehicle Loans, Business Loans, Personal Loans, Consumer Durables Loan, Loans against Property, Loans against Securities and Tractor Loans.
Disbursements in FY 2013-14 aggregated Rs. 42140.000 Million as compared to Rs. 38240.000 Million in FY 2012-13. CFAB continued to focus on margin expansion during the year. Net Interest Margin increased from 4.50% in FY 2012-13 to 4.89% in FY 2013-14 and Cost to Income ratio reduced from 65.33% in FY 2012-13 to 62.90% in FY 2013-14.
Auto Loans continued to constitute the major share of disbursements at Rs. 18420.000 Million, in FY 2013-14. Tractor Finance business was further scaled up during the year, with disbursals increasing to Rs. 5590.000 Million from Rs. 2580.000 Million in the previous financial year, reflecting a year on year increase of 116%. The Direct Business Verticals continued to work on CFAB’s core strategy of becoming a ‘customer-centric’ company and building customer proximity, by offering a single - point interface to customers for all their financial needs.
The Closing Book stood at Rs. 69000.000 Million (FY 2012-13: Rs. 60660.000 Million), comprising Auto Loans of Rs. 31490.000 Million (46%), Business Loans and Personal Loans of Rs. 10940.000 Million (17%), Loans against Property of Rs. 17460.000 Million (27%), Tractor Finance & Other Products of Rs. 9110.000 Million (13%). As at March 31, 2014, CFAB’s Gross NPA was at 1.39% and Net NPA, at 1.07% as compared to Gross NPA of 0.57% and Net NPA, of 0.39% as at March 31, 2013. The increase in NPA was on account of the subdued economic environment.
Going forward, CFAB plans to grow its business through ramping up its existing products, improving profitability by balancing its product mix, controlling operating costs, improving recoveries and collection efficiencies and enhancing risk management.
Tata Cards
Tata Card is a White Label Credit Card issued and operated by SBI Cards, a Joint Venture between SBI and GE Capital. TCFSL manages the marketing and alliances with the Tata Group entities, while sales, customer service, other back end operations and the credit risk are with SBI Cards.
Tata Cards had a base of 0.140 Million customers as of March 31, 2014, up from 1.16 lakh last year, registering a growth of 19%. The total customer spends for FY 2013-14 was Rs. 8180.000 Million, up from Rs. 5300.000 Million in FY 2013, resulting in a growth of 54% in spends, while the industry grew only by 30%.
The Tata Card is backed by its flagship loyalty program called ‘Empower’ and it is the most rewarding program in the industry. The card allows the customer to earn points on every spend and redeem instantly across 200 stores of Tata Group companies such as Croma, Westside, Titan and Star Bazaar.
FINANCE
Resources
During FY 2013-14, the Company met its funding requirements through a combination of short term debt (comprising Commercial Paper, ICDs and Bank Loans) and long term debt (comprising Non Convertible Debentures (“NCDs”) and Bank Loans). During FY 2013-14, the Company issued Unsecured Debentures by way of Perpetual Debt of Rs. 935.500 Million and Secured Redeemable NCDs of an aggregating face value of Rs. 30154.000 Million through private placements, with tenors ranging from 13 months to 60 months, which helped in Asset Liability Management and strengthened the long term resource base of the Company.
The aggregate debt outstanding as at March 31, 2014 was Rs. 189860.000 Million (of which, Rs. 110260.000 Million was payable within one year).
The Debt/Equity ratio as on March 31, 2014 was 5.9:1.
The Company has been regular in servicing all of its debt obligations.
Secured Redeemable
NCDs issued to the Public
Pursuant to the approval of the holders of the Secured Redeemable Non Convertible Debentures issued to the Public (“Public NCDs”), in February 2014, accorded by way of a Postal Ballot and individual consents received thereafter, a part of the NCDs were continued for a further period of five years i.e. upto March 5, 2019, at the existing coupon rate. Accordingly, out of an outstanding aggregate amount of Public NCDs of Rs. 6050.200 Million (post the modification/variation of the terms of the Public NCDs in 2012), Public NCDs aggregating Rs. 3168.400 Million (52.47%) were redeemed on March 5, 2014 and Public NCDs aggregating Rs. 2881.800 Million (47.6%) were continued for a further period of five years.
INDEX OF CHARGES
|
S.NO. |
CHARGE ID |
DATE OF CHARGE
CREATION/MODIFICATION |
CHARGE AMOUNT
SECURED |
CHARGE HOLDER |
ADDRESS |
SERVICE REQUEST
NUMBER (SRN) |
|
1 |
10590187 |
14/08/2015 |
10,000,000,000.00 |
IL & FS TRUST COMPANY LIMITED |
IL & FS FINANCIAL CENTREPLOT NO C22 G BLOCK
BANDRA |
C62628201 |
|
2 |
10576297 |
03/06/2015 |
20,000,000,000.00 |
IL & FS TRUST COMPANY LIMITED |
IL & FS FINANCIAL CENTREPLOT NO C22 G BLOCK
BANDRA |
C56528722 |
|
3 |
10554302 |
09/02/2015 |
30,000,000,000.00 |
IL & FS TRUST COMPANY LIMITED |
IL & FS FINANCIAL CENTREPLOT NO C22 G BLOCK
BANDRA |
C45088648 |
|
4 |
10533391 |
10/11/2014 |
20,000,000,000.00 |
IL & FS TRUST COMPANY LIMITED |
IL & FS FINANCIAL CENTREPLOT NO C22 G BLOCK
BANDRA |
C34117754 |
|
5 |
10508919 |
13/06/2014 |
20,000,000,000.00 |
IL & FS TRUST COMPANY LIMITED |
IL & FS FINANCIAL CENTREPLOT NO C22 G BLOCK
BANDRA |
C09857335 |
|
6 |
10443505 |
13/06/2014 * |
20,000,000,000.00 |
IL & FS TRUST COMPANY LIMITED |
IL & FS FINANCIAL CENTREPLOT NO C22 G BLOCK BANDRA |
C09859216 |
|
7 |
10415220 |
05/03/2013 |
20,000,000,000.00 |
IL & FS TRUST COMPANY LIMITED |
IL & FS FINANCIAL CENTREPLOT NO C22 G BLOCK
BANDRA |
B71374565 |
|
8 |
10369493 |
13/07/2012 |
30,000,000,000.00 |
IL & FS TRUST COMPANY LIMITED |
IL & FS FINANCIAL CENTREPLOT NO C22 G BLOCK
BANDRA |
B45162377 |
|
9 |
10423876 |
27/03/2012 |
150,000,000,000.00 |
IL & FS TRUST COMPANY LIMITED |
IL & FS FINANCIAL CENTREPLOT NO C22 G BLOCK
BANDRA |
B66926866 |
|
10 |
10420577 |
27/03/2012 |
10,000,000,000.00 |
IL & FS TRUST COMPANY LIMITED |
IL & FS FINANCIAL CENTREPLOT NO C22 G BLOCK
BANDRA |
B67558700 |
* Date of charge modification
FIXED ASSETS
Tangible Assets
- Buildings
- Leasehold Improvements
- Furniture and Fixtures
- Computer
- Office Equipment
- Plant and Machinery
- Vehicles
Assets given under operating Lease/rental
- Construction Equipment
- Vehicles
- Plant and Machinery
- Computer Equipment
- Furniture and Fixtures
Intangible Assets
- Goodwill
- Software
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No exist designating subject or any of its beneficial owners, controlling
shareholders or senior officers as terrorist or terrorist organization or whom
notice had been received that all financial transactions involving their assets
have been blocked or convicted, found guilty or against whom a judgement or
order had been entered in a proceedings for violating money-laundering,
anti-corruption or bribery or international economic or anti-terrorism sanction
laws or whose assets were seized, blocked, frozen or ordered forfeited for
violation of money laundering or international anti-terrorism laws.
2] Court Declaration :
No exist to suggest that subject is or was
the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper payments
to government officials for engaging in prohibited transactions or with
designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l Anti-Money
Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report : No press reports / filings exists on the
subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws, regulations
or policies that prohibit, restrict or otherwise affect the terms and
conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.64.82 |
|
|
1 |
Rs.100.12 |
|
Euro |
1 |
Rs.73.75 |
INFORMATION DETAILS
|
Information
Gathered by : |
KMN |
|
|
|
|
Analysis Done by
: |
KAS |
|
|
|
|
Report Prepared
by : |
SANS |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL
CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
7 |
|
--PROFITABILITY |
1~10 |
7 |
|
--LIQUIDITY |
1~10 |
7 |
|
--LEVERAGE |
1~10 |
7 |
|
--RESERVES |
1~10 |
7 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
---- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
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 |
|
63 |
This score serves as a reference to assess SC’s
credit risk and to set the amount of credit to be extended. It is calculated
from a composite of weighted scores obtained from each of the major sections of
this report. The assessed factors and their relative weights (as indicated
through %) are as follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend (10%) Operational size
(10%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively below
average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
-- |
NB |
New Business |
-- |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or
its officials.