sr indus electro sys private limited smera mse 2 · smera mse 6 below-average credit worthiness in...
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SR Indus Electro Sys Private Limited Rating Valid Till August 26, 2017 Page 1 of 23
SMERA-D&B-NSIC MICRO & SMALL ENTERPRISES RATING
Rating and Site Visit Report
SR INDUS ELECTRO SYS PRIVATE LIMITED
SMERA MSE 2
Financial Strength: Good
Operating Performance: High
D-U-N-S® Number: 87-391-5812
Date of Report: August 27, 2016
Valid Till: August 26, 2017
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DISCLAIMER
SMERA Micro & Small Enterprises (MSE) Ratings (MSE Ratings) are based on the data and information (Data) provided by the MSE and obtained by SMERA from sources it considers reliable. Although reasonable care has been taken to verify the Data, SMERA, makes no representation or warranty, expressed or implied with respect to the accuracy, adequacy or completeness of any Data relied upon. SMERA is not responsible for any errors or omissions or for the results obtained from the use of the Rating or the Rating Report and especially states that it has no financial liability, whatsoever, for any direct, indirect or consequential loss of any kind arising from the use of its Ratings. A SMERA MSE Rating does not constitute an audit of the rated entity and should not be treated as a recommendation or opinion or a substitute for investor's independent assessment of whether to buy, sell or hold any security. The SMERA MSE Rating Report should not be distributed/published/reproduced in any form without SMERA’s prior written approval.
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SR Indus Electro Sys Private Limited Rating Valid Till August 26, 2017 Page 3 of 23
CONTENTS
Rating of SR Indus Electro Sys Private Limited ................................................................................ 4
SWOT – Strengths & Risk Factors .................................................................................................... 5
Company Fact Sheet ........................................................................................................................ 7
Business Profile ................................................................................................................................ 8
Ownership & Management ........................................................................................................... 11
Financial Profile .............................................................................................................................. 14
Banking Facilities ........................................................................................................................... 21
Site Visit Report ............................................................................................................................. 22
Benefits to the MSE ....................................................................................................................... 23
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Rating Symbol Definition
SMERA MSE 1 Highest credit worthiness in relation to other MSEs
SMERA MSE 2 High credit worthiness in relation to other MSEs
SMERA MSE 3 Good credit worthiness in relation to other MSEs
SMERA MSE 4 Above-average credit worthiness in relation to other MSEs
SMERA MSE 5 Average credit worthiness in relation to other MSEs
SMERA MSE 6 Below-average credit worthiness in relation to other MSEs
SMERA MSE 7 Weak credit worthiness in relation to other MSEs
SMERA MSE 8 Poor credit worthiness in relation to other MSEs
Financial Strength Categories
Highest
High
Good
Above Average
Average
Below Average
Weak
Poor
Operating Performance Categories
Highest
High
Average
Weak
Poor
Rating of SR Indus Electro Sys Private Limited
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Strengths
Experienced and qualified management.
Inventory holding days stands at 30 as on March 31, 2015.
Net Profit Margin stands at 4.40 in FY 2015.
Comfortable Debt Equity Ratio and stands at 0.55 as on March 31, 2015.
Interest Coverage Ratio stands at 8.26 as on March 31, 2015.
Current Ratio stands at 1.64 in FY 2015.
SWOT – Strengths & Risk Factors
Risk Factors
Negative Cash Flow from Operations.
As observed in the financials, company has payables to related parties of Rs. 65.28 (in
lacs) as on March 31, 2015. Further, as per telecom held with client about the nature,
same is director’s remuneration payable.
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Rating Parameters Sensitivity Factors Impact
Business
Industry Risk
Highly fragmented and competitive industry. Unfavourable
There is an increasing demand in the industry due to favourable business environment
Favourable
Market Position
Geographically diversified customer base. Favourable
Operational track record of 05 years. Favourable
Reputed Customer base and Supplier base. Favourable
Operating Efficiency
Healthy Operating Profit Margins. Favourable
Efficient working capital management. Favourable
Current Ratio stands at 1.64 in FY 2015. Favourable
Financial
Financial & Accounting
Policies
Adheres to the accounting policies. Favourable
Financial Analysis
Comfortable Debt Equity Ratio in FY 2015. Favourable
High Interest Coverage Ratio in FY 2015. Favourable
Negative Cash Flow from Operations in FY 2015. Unfavourable
Healthy Net Profit Margins as on March 31, 2015. Favourable
Management Management
Risk
No instance of default. Favourable
Experienced and Qualified Management. Favourable
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Unit Name SR INDUS ELECTRO SYS PRIVATE LIMITED
Address Line 1 No 1116, Ground Floor
Address Line 2 10th Main, Vyalikaval
City Bengaluru
State Karnataka
PIN code 560003
Type of Organization Private Limited
Year of Establishment 2011
Commencement of operations May 20, 2011
Contact No (91) 9880699831
Email Id [email protected] [email protected]
UAM / EM No KR03A0013063
Number of employees
Permanent 07
Contractual 03
Website -
Statutory auditor Mr. Jayatheertha K B
Address Line 1 NO-337/1A, 18TH CROSS
Address Line 2 Upper Palace Orchards, Sadashivangar
City Bengaluru
State Karnataka
PIN code 560080
Adverse comment, if any, of the statutory auditor No
Comments on statutory compliance No
Registrations/Memberships/Certificates Registration/Membership/Consent No. Date of Expiry / Renewal
VAT/ GST No. - -
CST No - -
PAN No AAPCS7459F -
Aadhaar No 776436132137 -
Company Fact Sheet
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Business Description
Line of business Engaged in manufacturing of electrical equipment
Products/Services Profile Electrical Equipment
Industry Electrical and Engineering Goods
Industry Prospects Good
Sub-Industry Electrical and Engineering Goods
Degree Of Competition High
Future Project(s)
Taking New Products (Related)
Customer Profile
Customer 1
Name Titen Industries
Address Line 1 Sipcot Industrieal Area
Address Line 2 Area Phase I
City Hosur
Office no* +91- 434 4664841
Mobile Number* (91) 9488843388
Terms of credit * Open credit account for 30 Days
Length of relationship (years) * 04
Share of sales (percentage) * 09
Customer 2
Name BOSCH
Address Line 1 ATM 06 Adugodi
Address Line 2 Bannergatta Road
City Bengaluru & Goa
Office no* 080-41768059
Mobile Number* +91 984552910
Terms of credit * Open credit account for 30 Days
Length of relationship (years) * 10
Share of sales (percentage) * 05
Business Profile
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Customer 3
Name BFW
Address Line 1 Yeshawanthpura
Address Line 2 Tumkur Road
City Bengaluru
Office no* +91 8039821257
Mobile Number* (91) 7483215811
Terms of credit * Open credit account for 60 Days
Length of relationship (years) * 04
Share of sales (percentage) * 10
Supplier Profile
Supplier 1
Name Weidmuller (Germany)
Address Line 1 Union Street
Address Line 2 Off Infantry Road
City Bengaluru
Office no* +91 8022860028
Mobile Number* (91) 7829411132
Credit terms * Open credit account for 30 Days
Raw material procured * Electrical & Electronic Parts
Length of relationship (years) * 05
Share of purchase (percentage) * 60
Supplier 2
Name Hengstler
Address Line 1 Lalbaug Road
Address Line 2 Lalbaug
City Mumbai and Bengaluru
Office no* +91 22 42270308
Mobile Number* (91) 9620926600
Credit terms * Open credit account for 30 Days
Raw material procured * Encoders
Length of relationship (years) * 04
Share of purchase (percentage) * 10
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Supplier 3
Name Harting (Germany)
Address Line 1 4th 'T' Block
Address Line 2 Jayanagara
City Bengaluru
Office no* 080-41330555
Mobile Number* +91 9972583932
Credit terms * Open credit account for 10 Days
Raw material procured * Industrial Connectors
Length of relationship (years) * 10
Share of purchase (percentage) * 10
Manufacturing Facilities FY 2015
Capacity Installed per annum (numbers) -
Capacity Utilized per annum (numbers) -
Capacity expansion planned per annum (numbers)
-
Service Facilities FY 2013 FY 2014 FY 2015
Not applicable - - -
Not applicable - - -
Not applicable - - -
Market Composition FY2013 FY2014 FY2015
Domestic (%) 100 100 100
Exports (%) 0 0 0
Total (%) 100 100 100
Purchase Composition FY2013 FY2014 FY2015
Domestic (%) 25 24 20
Imports (%) 75 76 80
Total (%) 100 100 100
SMERA Observation(s)
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Details of the Proprietor/ Partner/ Director -1
Designation Director
Name Mr. Anil Kumar Shetty
Address Line 1 No 1116, Ground Floor,
Address Line 2 10th Main, Vyalikaval
City Bengaluru
Mobile Number (91) 9880699831
Year of birth 1975
Appointed to present position 2011
Employed with Unit since 2011
Highest Educational Qualification * Diploma
Specialization * Electronic Communication
Permanent Account Number* AAPCS7459F
Details of the Proprietor/ Partner/ Director -2
Designation Director
Name Mr. S.R Swami
Address Line 1 No.2 Old No.Y-145, 12th Main Road
Address Line 2 4th Division Vyalikaval
City Bengaluru
Mobile Number (91) 9343864887
Year of birth 1957
Appointed to present position 2011
Employed with Unit since 2011
Educational Qualification * B.E & MBA
Specialization * Mechanical & Marketing
Permanent Account Number* ABOPS9741F
Share Holding Pattern / Profit / Loss Sharing Ratio as on March 31, 2015
Name of Proprietor/ Partner / Shareholders
Relation With The Promoter Profit/Loss Sharing Ratio (%)
Mr. Anil Kumar Shetty Self -
Mr. S. R. Swami
Other
-
Mrs. Nanda Swami -
Mrs. Pragathi Shetty -
N S Engineers and Management Consultants
Group Company -
Total 100.00
Ownership & Management
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Details of Key Management Personnel -1
Designation Accountant
Name Mr. Madhu
Address Line 1 No 1116, Ground Floor
Address Line 2 10th Main Road
City Bangalore
State Karnataka
Mobile Number 9379977755
Year of birth 1984
Appointed to present position 2011
Employed with Unit since 2011
Highest Educational Qualification * B.com
Specialization * Cost accounting
Details of Key Management Personnel - 2
Designation Sales
Name Sathish
Address Line 1 No 1116, Ground Floor,
Address Line 2 10th Main Road
City Bangalore
State Karnataka
Mobile Number 9845439050
Year of birth 1976
Appointed to present position 2013
Employed with Unit since 2013
Highest Educational Qualification * B. Sc.
Specialization * PCM
Organization Structure, Control & Systems
Head of Organization S R Swami
Second Tier Management Mr. Anil Kumar Shetty, Finance and Marketing
Decision Making Powers Delegated to respective Departmental Head
Reporting System or MIS Talley ERP 9.0 version
Type of Reporting System OA, DCs, Invoices, Costing & Financial analysis
Frequency of MIS/ Reporting Daily
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Associates/ Group Companies
Associates/ Group Company - 1
Name N.S.Engineering & Managment Consultant
Address Line 1 No.2 Old No.Y-145, 12th Main Road
Address Line 2 4th Division Vyalikaval
City Bengaluru
Line of business Manufacturing Of Cable Assembly & Trading Of Machine Lamps & Harting Connecting
Sales (Rs in lacs last financial year) 50
Net profit (Rs in lacs last financial year) 04
Total Debt (RS in lacs last financial year) 0
Total net worth (Rs in lacs last financial year) 60
As informed by management, the group company is also a director of SR Indus Electro Sys Private Limited.
SMERA Observation(s)
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Profit & Loss Account (In Rupees Lacs)
Financial Year March 31, 2015 March 31, 2014 March 31, 2013
Months Covered By P/L 12 12 12
Income 467.86 372.98 272.96
Domestic Sales 467.86 372.98 272.96
Cost of Sales -391.99 -316.01 -238.22
Employee Cost -30.42 -9.39 -14.86
Rent / Repairs and
Maintenance -1.78 -1.80 -0.90
Electricity Cost -0.12 -0.09 -0.11
Job Work Charges 0.00 0.00 0.00
Other Direct Expenses -2.54 -2.38 -2.60
Raw Material Consumption
Cost -357.13 -302.35 -219.75
Gross Profit 75.87 56.97 34.74
Depreciation/Amortization -1.61 -0.46 -0.32
General Operating Expenses -49.66 -38.30 -19.99
Directors / Partners
Remuneration -31.23 -11.52 0.00
Other -18.43 -26.78 -19.99
Net Operating Profit After
Depreciation and Before
Interest 24.60 18.21 14.43
Non Operating Income 10.90 0.85 0.34
Finance Expenses -5.44 -4.88 -4.74
Interest to Third Parties -4.14 -3.84 -4.26
Commission & Charges -1.30 -1.04 -0.48
Net Profit Before Taxation &
After Extraordinary Items 30.06 14.18 10.03
Income Tax -9.49 -4.43 -3.27
Current Tax -9.07 -4.43 -3.27
Deferred Tax (Liability) / -0.42 0.00 0.00
Financial Profile
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Reversal
Net Profit After Tax 20.57 9.75 6.76
Less: Transfers to Reserves -20.57 -9.75 -6.76
Retained Earnings (Loss) C/F 0.00 0.00 0.00
The above financials are taken from the audited accounts of the company
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Balance Sheet (In Rupees Lacs)
Date March 31, 2015 March 31, 2014 March 31, 2013
Assets
Current Assets
Cash & Bank 19.05 19.71 13.82
Inventory / Work-in-Progress 37.97 24.21 20.39
Accounts Receivable 1.31 0.33 1.22
Receivables (upto 6 months) 102.17 69.96 50.62
Advance to suppliers 3.03 1.05 0.00
Other Current Assets 7.66 6.11 3.81
Total Current Assets 171.19 121.37 91.08
Fixed Assets 0.00 0.00 0.00
Other Fixed Assets 4.04 1.04 0.93
Total Fixed Assets 4.04 1.04 0.93
Other Assets (Non-Current) 0.00 0.00 0.00
Other Non-Current Assets 0.00 0.12 0.24
Total Other Assets 0.00 0.12 0.24
Total Assets 175.23 122.53 92.25
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Date March 31, 2015 March 31, 2014 March 31, 2013
Liabilities
Current Liabilities
Accounts Payable 23.81 30.25 25.24
Short term Secured Loans
from Banks / Financial
Institutions
3.40 1.99 0.00
Advances from Customers 0.09 0.02 0.13
Payables to Related Parties 65.28 33.29 24.73
Other Current Liabilities 11.69 7.01 7.23
Total Current Liabilities 104.27 72.56 57.33
Non-Current Liabilities
Total Long Term Debt
Loans from Directors /
Shareholders / Relatives /
Friends / Group Entities /
Related Entities
22.84 22.84 17.54
Deferred Tax Liability 0.42 0.00 0.00
Total Non-Current Liabilities 23.26 22.84 17.54
Equity
Capital 10.00 10.00 10.00
General Reserves 37.70 17.13 7.38
Total Equity 47.70 27.13 17.38
Total Liabilities 175.23 122.53 92.25
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Financial Ratios
Date March 31, 2015 March 31, 2014 March 31, 2013
Growth Ratios
Sales Growth (%) 25.44 36.64 -
Net Profit Growth (%) 110.97 44.23 -
Turnover Ratios
Collection Period (Days) 80.73 68.79 70.95
Account Payable (Days) 23.43 36.06 39.04
Inventory Holding period (Days) 29.62 23.69 27.27
Gross Working Capital (Related to operation) to sales (Days) 133.55 118.77 121.79
Sales to Net Working Capital (Times) 6.99 7.64 8.09
Assets to Sales (%) 37.45 32.85 33.80
Fixed Assets Turnover Ratio 115.81 358.63 293.51
Profitability Ratios
Gross Profit Margin (%) 16.22 15.27 12.73
Operating Profit Margin (%) 5.26 4.88 5.29
Net Profit Margin (%) 4.40 2.61 2.48
Return on Assets (%) 11.74 7.96 7.33
Return on Net Worth (Return on Equity) (%) 43.12 35.94 38.90
Return on Capital Employed (%) 34.98 28.16 32.93
Liquidity Ratios
Quick Ratio 1.28 1.34 1.23
Current Ratio 1.64 1.67 1.59
Gearing & Solvency Ratios
Fixed Assets to Tangible Net Worth (%) 8.47 3.83 5.35
Current Liabilities to Tangible Net Worth (%) 218.60 267.45 329.86
Total Liabilities to Tangible Net Worth (%) 267.36 351.64 430.78
Total Debt to Equity Ratio 0.55 0.92 1.01
Debt Equity Ratio 0.48 0.84 1.01
DSCR (If Applicable) - - -
Interest Coverage Ratio 8.26 4.69 3.35
As observed in the financials, company has payables to related parties of Rs. 65.28 (in lacs) as
on March 31, 2015. Further, as per telecom held with client about the nature, same is
director’s remuneration payable.
SMERA Observation(s)
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Cash Flow Statement From Operations (Rs. In Lacs)
CASH FLOW FOR THE YEAR ENDED March 31, 2015 March 31, 2014
MONTHS 12 12
NET PROFIT BEFORE TAX AND
EXTRAORDINARY ITEMS 30.06 14.18
Adjustments for:
Depreciation 1.61 0.46
Non-Operating Income (10.90) (0.85)
Interest Expense 5.44 4.88
Subtotal (3.85) 4.49
Operating Profit Before Working Capital
Changes 26.21 18.67
Adjustment for:
Accounts Receivables (33.19) (17.23)
Other Receivables (Inclusive of Taxes) (12.60) (7.78)
Inventories (13.76) (3.82)
Trade Payables (6.44) 5.01
Net Cash from Operating Activities (A) (3.04) 3.08
CASH FLOW STATEMENT FROM
INVESTING ACTIVITIES
Proceeds From/ Expenditure on Fixed
Assets (NET) (4.61) (0.57)
Cash Flow from Purchase/ Sale of
Investments 0.12 0.12
Non-Operating Income (INVESTING
ACTIVITIES) 10.90 0.85
Cash Generated from Investing
Activities (B) 6.41 0.40
CASH FLOW STATEMENT FROM
FINANCING ACTIVITIES
Proceeds from Short Term Borrowings
(Net of Repayments) 1.41 1.99
Proceeds from Long Term Borrowings 0 5.30
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(Net of Repayments)
Interest Paid (5.44) (4.88)
Cash Generated from Financing
Activities (C) (4.03) 2.41
Net Increase in cash & cash equivalents
(A+B+C) ()
Cash & Cash equivalents (opening
balance) 19.71 13.82
Cash & Cash equivalents (closing
balance) 19.05 19.71
Difference 0 0
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Bank 1
Name Bank Of Maharashtra
Branch Malleshwaram
IFSC MAHB0000344
Address Line 1 East Park Road, 8th Cross,
Address Line 2 Malleshwaram,
City Bengaluru
PIN code 560003
Contact Number (Office) (91) 9163296256 / 080-23568413
E-Mail ID * [email protected]
Term Loan (in lacs) -
Interest Rate (%) -
Working Capital Loan (in lacs) 20
Interest Rate (%) 18%
Non Fund Based Limits (in lacs) NA
Banker's feedback Not Available
Banking Facilities
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Address line 1 No 1116, Ground Floor
Address line 2 10th Main, Vyalikaval
City Bengaluru
State Karnataka
PIN code 560003
Date of Site Visit August 11th, 2016
Name of Site Visit Officer Mr. Thyagaraj
Unit's official contacted
Name Mr. Madhu
Designation Accountant
Mobile No (91) 9379977755
Email id [email protected]
Size of Premises 800 sq. feet
Site Details/Type Stores 500 sq. feet
No of floors in the building 03
Fire extinguisher No
Power installed (KW/ HP) 4 KW
Power Back-Up Yes
Signage/Name Plate Yes
Environmental clearance Not Applicable
If Yes, provide Certificate/Registration Number -
Site Lay Out Moderate
Installed capacity No
Utilized Capacity No
Name of the Raw material being used Machinery parts, Electrical parts, Electronic parts
Source of raw material Imports
Kind of Building RCC Construction
On Floor Ground floor
Total Floors in the Building Ground floor +2
Type of Occupation Rented
Owner’s Name Mr. Guru T.G
Site Visit Report
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