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 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



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.



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



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



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.



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



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

mailto:[email protected]




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




Business Profile



Customer 3

Name BFW

Address Line 1 Yeshawanthpura

Address Line 2 Tumkur Road

City Bengaluru

Office no* +91 8039821257





Supplier Profile

Supplier 1

Name Weidmuller (Germany)

Address Line 1 Union Street

Address Line 2 Off Infantry Road

City Bengaluru

Office no* +91 8022860028


Credit terms * Open credit account for 30 Days

Raw material procured * Electrical & Electronic Parts


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



Raw material procured * Encoders





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


Raw material procured * Industrial Connectors



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 - - -



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)



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



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



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



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



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



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.




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



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



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




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



Financial Ratios


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.




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



(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



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



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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sr indus electro sys private limited smera mse 2 · smera mse 6 below-average credit worthiness in...

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