8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 1
ODAWARI POWER AND ISPAT LTD BUY
dawari Power and Ispat Ltd (GPIL) the flagship company of the Hira Group of Industries based in
hattisgarh is a mid size steel manufacturer The company has a wide range of products from sponge
n billets wire rods and ferro alloys Besides this GPIL has presence in power sector with consolidated
wer generation capacity of 103MW
GPIL is in process of becoming fully integrated steel player In iron ore mining space it has got
mining lease of iron ore mines at Ari Dongri and Boria Tibu in Chhattisgarh with total capacity of
12mn tonnes Of these Ari Dongri mine is operational whereas for Boria Tibu the company has
received all regulatory clearance and is awaiting surface right from forest department It is expected
that the mine will be operational in FY14 and the total output from both the mines would reach
around 12mn tonnes and would meet 100 captive requirement
The company has pellet production capacity of 12mn tonnes (including 06mn tonnes capacity of
its 75 subsidiary Ardent Steel) For both the plants the operational issues has been cleared and is
expected to operate at higher capacity utilization leading to higher pellet production The company
is expected to register pellet production growth of 79 over FY12-14
The company is expected to improve its operating margin from the fall in key raw material prices
like iron ore and coal Currently the company meets its iron ore short-fall from spot market Post
commencement of operation at Boria Tibu mine it will meet its iron ore requirement captively and
will be insulated from the fluctuation of iron ore prices in the spot market
GPIL is implementing 50MW solar power plant under Jawaharlal Nehru National Solar Mission and
the project is expected to be completed by Q1FY14 Power generated will be sold at Rs 122 per unit
or 25 years to NTPC Vidyut Vyapar Nigam Limited (NVVN) Moreover the company is planning to set
up a 13GW of thermal power plant in Chhattisgarh through its 100 subsidiary Godawari Energy
Ltd (GEL)
sed on a consolidated FY14 PE multiple of 4 the fair value for the company works out
Rs 142
STOCK DATA
BSE NSE Code
Bloomberg Code
No of Shares (Mn)
Sensex Nifty
PRICE DATA
CMP Rs (06th June 12)
Beta
Market Cap (Rs mn)
52 Week High-low
Average Daily Volume
STOCK RETURN ()
30D 3M
Godawari Power and Ispat Ltd -1 10
Sensex -2 -4
Nifty -2 -4
SHARE HOLDING PATTERN ()
Promoter
Institutional
Non Institutional
Total
1 Year Price Performance (Rel to Sensex)
GOD
Projections (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Net Sales 8266 11274 20604 20145 21898
Y-o-Y Growth -24 36 83 -2 9
EBIDTA 1305 2323 2818 3099 3458
Y-o-Y Growth 6 78 21 10 12
Adjusted PAT 572 859 843 1032 1129
Y-o-Y Growth -8 50 -2 22 9
EPS Rs 18 27 27 33 36
BVPS Rs 160 215 243 276 311
EBIDTA 16 21 14 15 16
NPM 7 8 4 5 5
ROE 11 13 11 12 11
PER x 35 32
PB Ratio 04 04
Financial Snapshot
30
40
50
60
70
80
90
100
110
Sensex GPIL
Recommendations lt= 1 year 1 - 2 yrs
Strong Buy
Buy
Hold
Reduce
SellStrong Buy ndash Expected Returns gt 20 pa
Buy ndash Expected Returns from 10 to 20 pa
Hold ndash Expected Returns from 0 to 10 pa
Reduce ndash Expected Returns from 0 to 10 pa with possible down
Sell ndash Returns lt 0
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 28
June 08
wwfullertonsecuritiescoin Page | 2
Godawari Power amp Ispat Ltd (GPIL) formally Ispat Godawari Ltd (IGL) belonging to HIRA Group of Industries
pur was incorporated in 1999 to set up an integrated steel plant with captive power generation Today GPIL is an
egrated steel manufacturer and has dominant presence in the long product segment of the steel industry mainly into
d steel wire
GPIL is an end-to-end manufacturer of mild steel wires In the process the company manufactures sponge iron
ets ferro alloys captive power wires rods steel wires oxygen gas fly ash brick and pellets GPIL is also awarded rights for
al and iron ore mining for captive consumption as a result of which the company has managed to traverse the entire
ue chain (raw material to final product) in steel wires and is now a fully integrated manufacturer
In 2007 the company was allotted a coal mine in Chhattisgarh in JV with four other companies The total coal
erve is around 243mn tonnes of that GPILrsquos share is 26 (ie 63mn tonne) On iron ore mining front GPIL was awarded
ning lease in two iron ore mine with total reserves of 15mn tonnes For both GPIL has a mining license of 06MT having Fe
ntent of 62-64 and Lump to Fine ratio of 5050 Ari Dongri captive coal mine with reserve of 7mn tonnes is operational
ce Q1FY10 Another mine at Boria Tibu with reserve of 8mn tonnes is expected to be operational in FY13 Post
mmencement of operation at the Boria Tibu the company will meet its iron ore captively and will be insulated from the
ctuation of iron ore price in spot market Moreover due to mines located in the vicinity of the plant there will be
bstantial reduction in the cost of procurement These mines have lump concentration of 50 which will be used in the
nufacturing of sponge iron Before converting it into sponge iron lump mine is converted into pellet with the help of two
nts of 06mn tonnes each As a result of this process the landed cost of the ore for sponge production will be lower which
l increase the operating margin in the upcoming years
USINESS PROFILE
GPIL Pellets (mn Tonnes) 060
Ardent Steel Pellets (mn Tonnes) 060Sponge Iron (mn Tonnes) 050
Steel Billets (mn Tonnes) 040
HB Wire (mn Tonnes) 012
Ferro Alloys (mn Tonnes) 002
Iron ore Mine (mn Tonnes) 060
Power Capacity (MW) 10300
Current Production Capacity as on FY12
Hira Ferro Alloys Ltd (51 Subsidiary) 30
Thermal 20
Wind Mill 15
Bio Mass 85
GPIL 73
Thermal 11
Waste Heat recovery 42
Bio Mass 20
Consolidated Total 103
Electricity Capacity Portolio as on FY12
Resource Location Reserves (mn Tonnes) Capacity (mn Tonnes) Status
Iron Ore Ari Dongri Chhattisgarh 7 06 Operational
Iron Ore Boria Tibu Chhattisgarh 8 06Awaiting Surface Clearence from
Forest Ministry
Iron Ore 983107983144983144983137983156983156983145983155983143983137983154983144 100 -- Received Prospecting License
Coal Nakia (GPIampLs 26 stake) 243 --Waiting for Environment and Forest
Clearence
Mining Portfolio as on FY12
GPIL is the first comto utilize lump iron omanufacture sponge
GPIL has manufacturing capof 12mn tonnes
GPIL has pgeneration capacit73MW and is expectadd 50MW in FY14
From its subsidiaryAlloys Ltd it has pgeneration capacit30MW
The company has stfocusing on business from pbusiness due to volin merchant power r
Iron ore mine at Tibu is expected toperational by FY13
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 3
uctuation in prices of raw material amp fuel GPILrsquos major raw material is iron ore and coal On the iron ore front one of two
n captive mines commenced production The other mine ie Boria Tibu also received all regulatory clearances and should
rt production soon Hence GPIL will be insulated from the fluctuation of iron ore prices in the spot market However until
th the mines start production GPILrsquos operations will continue to be affected by fluctuation in the prices of iron ore to the
ent of dependence on market purchases
On the coal front GPIL is currently meeting its coal requirement through long-term linkages with Coal India
mited and imports The prices of imported coal depend upon the global market demand and supply and linkage prices as
termined by the Ministry of Coal The company shall be insulated from price fluctuations once captive mines startoduction GPIL awaits regulatory approvals from various departments for the coal blocks it has been allotted
anges in selling prices A specific feature of steel and mining industries is their liability to cyclical changes in steel prices
critical conditions where the selling prices were almost equal to the average cost of production of sponge iron
ofitability margins gets impacted So if prices of finished products fall to such a level margins cannot be maintained
edit interest and exchange fluctuation risk Financial crisis of the economy in 2008 has led to an interbank crisis of
st reducing the levels of interbank credits and liquidity of the financial system Simultaneously increased volatility and
certainties led to increased premium in the cost of external financing The increased cost of financing may negatively
ect GPILrsquos financial results and lead to lower profitability Fluctuation of interest rates may cause variation in the value ofsting foreign currency
The level of existing rupee debt as on March 31 2011 is Rs3bn and foreign currency term loans of USD 12mn out
which 10mn is un-hedged Hence change in interest rates may have significant impact on the financial results
USINESS PROFILE
pansions in steel business GPIL signed MoUs with the Government of Chhattisgarh to undertake
Setting up of a sponge iron plant of 06mn tonnes per annum (mtpa) pig iron of 02mtpa steel billets of 06mtpa steel
olled product of 05mtpa ferro alloys of 20ktpa calcinations plant of 01mtpa and iron ore pellet plant of 3mtpa
Setting up an iron ore pellet plant with an installed capacity of 12mtpa at the organizationrsquos existing plant location at
Siltara in Raipur
pansions in power business
GPIL is foraying into the renewable energy space by setting up 50MW Solar Thermal Power Project under the Jawaharlal
Nehru National Solar Mission (JNNSM) Scheme through its 100 subsidiary Godawari Green Energy Limited (GGEL)
The company is also planning a 13GW thermal power plant through its 100 subsidiary Godawari Energy Limited (GEL)
at Raigarh Chhattisgarh
SK amp CONCERNS
The company planning to increaspellet producapacity from 0tonnes to 12mn toat its existing plaRaipur
GPIL is also planni13GW of pcapacity in Chhattis
GPIL is exposed tvolatility in the spoore and coal pricesits captive mineoperational
The company is expto gain from the firon ore and coal pr
GPIL is expected taffected due to volin currency rates asexposure from fo
currency term loans
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
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NANCIAL PERFORMANCE In Q4FY12 the company reported 53 Y-o-Y jump in consolidated top-line and a decline of 1 Y-o-Y in bottom-
e Operating revenue and net profit for the quarter stood at Rs 7bn and Rs 03bn respectively Growth in top-line was
ed by higher saleable volume and realization across the product portfolio Steel billets ferro alloys and pellets sales
reased by 45 19 and 18 Y-o-Y respectively However sales of sponge iron and power units declined by 11 and 39
pectively On realization front there was double digit growth on Y-o-Y basis for all products expect ferro alloys On
quential basis top-line and bottom-line increased by 37 and 210
Operating margin (EBITDA) declined by 520bps Y-o-Y due to 63 Y-o-Y increase in operating expenditure
erating expenditure was higher due to 66 31 and 36 increase in raw material employee expenses and other
pense Other expense includes exchange loss of Rs 02bn on account of foreign currency transaction Thus leading to
TDA of Rs 1bn with EBITDA margin of 15 as against 20 in the same quarter last year Other income declined by 97
d stood at Rs 3mn Bottom-line reported profit of Rs 03bn due to 11 and 8 increase in interest and tax expenses
pectively Tax expenses increased by 200bps leading to an increase in effective tax rate to 22
During the quarter the company has decided to issue and allot 5mn equity warrants convertible into 5mn equity
ares of Rs 10- each on preferential basis to the promoters andor promoters group at a price of Rs 130 per equity
rrants The holders of the said equity warrants shall have an option to convert the same into equity of the company on or
fore the expiry of 18 months from the date of allotment The fund raised would be used for funding the CAPEX of the
mpany
826611274
20604 2014521898
16
21
1415
16
7 8
45 5
0
5
10
15
20
25
-
5000
10000
15000
20000
25000
FY10A FY11A FY12A FY13E FY14E
Yearly Operating Margins
Revenue (Rs Mn) EBIDTA Margin PAT Margin
4298
4940
42874810
6568
20
1512
1215
86 2 2 5
0
5
10
15
20
25
0
3500
7000
Q4FY11 Q1FY12 Q2FY12 Q3FY12 Q4FY12
Quarterly Operating Margins
Revenue (Rs mn) EBITDA Margins PAT Margins
61078383 8412 7814 7529
1424818281
2104616637 16592
30837
34437 37403 33761 3411250
35 29 35 35
00
10
20
30
40
50
0
10000
20000
30000
40000
FY10A FY11A FY12A FY13E FY14E
Yearly Operating Performance
Pellets Realization (Rs per Tonne) Sponge Iron Realization (Rs per Tonne)
HB Wire Realization (Rs per Tonne) Power Realization (Rs per Unit)
7924 7956 7930 8571 9190
19445 19404 1987321464
23441
34811
35855 36415
37818
39525
25
29 29
30
26
24
26
28
30
0
10000
20000
30000
40000
Q4FY11 Q1FY12 Q2FY12 Q3FY12 Q4FY12
Quarterly Operating Performance
Pellets Realization (Rs per Tonne) Sponge Iron Realization (Rs per Tonne)
HB Wire Realization (Rs per Tonne) Power Realization (Rs per Unit)
In Q4FY12 toincreased by 53bottom-line declineY-o-Y
Top-line growth aided by growth involume and hrealization acrossproduct profile
Bottom-line was affdue to higher inand effective tax ra
On sequential operating mincreased 272bps d
correction in keymaterial prices
On Y-o-Y basis prealization increase4 and declined byon sequential basis
Pellet production dQ4FY12 increased dimprovement in capacity utilization
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 5
GPILrsquos top-line bottom-line expected to groCAGR of 3 andrespectively FY12-14
sed on the conservative estimated given below we estimate that GPILrsquos operating revenue to grow at a CAGR of 3 over
2012-14E to Rs 22bn Furthermore due to benefits arising from the backward integration process and increased capacity
lization we further estimate that net profit would grow at a CAGR of 16 to Rs 1bn over the same period Based on a
nsolidated FY14 PE multiple of 4 the fair value for the company works out to Rs 142
er Comparison Adhunik Metaliks Ltd (AML) is a diversified player having presence across steel mining and power
ors Moreover it has presence in merchant mining business It is trading at higher multiple due to highly integrated
ness and exposure to merchant mining business However the current valuation cannot be sustained due to falling
nganese ore prices Indian Metals and Ferro Alloys Ltd (IMFL) is one of the low cost producers of ferro alloys globally due to
tive mines and power units It is trading at higher PE multiple due to stable business model (earning stability as majority of
output is tied up for long term contracts) Major concern with IMFL is that it drives around 80 of the revenue from exportness and is subjected to risk related to subdued global demand and volatility in currency exchange rates GPIL is better
ced as compared to its peers because of the benefits arising from the integration process and improving capacity utilization
s plants
EER COMPARISION
ALUATION
Peer Group Comparison
CompaniesRevenue
(Rs mn)
EBIDTA
Margin ()
PAT
Margin ()ROE
PE
(x)
PB
(x)
CMP
(Rs)
FV
(Rs)
GODAWARI POWER amp ISPAT LTD 20604 14 41 109 4 05 113 10
ADHUNIK METALIKS LTD 19674 22 02 08 39 03 34 10
INDIAN METALS amp FERRO ALLOYS LTD 11927 19 52 76 12 09 280 10
FY12 Consolidated Figures
FY13E FY14E
Total Pellet Production (mn Tonnes) 079 116
Pellet realization (Rs per Tonne) 7814 7529
Sponge Iron Production (mn Tonnes) 037 040
Sponge Iron Realization (Rs per Tonne) 16637 16592
HB Wire Production (mn Tonnes) 010 010
HB Wire Realization (Rs per Tonne) 33761 34112
Steel Billet Production (mn Tonnes) 024 026
Steel Billet Realization (Rs per Tonne) 29060 29612
Ferro Alloy Production (mn Tonnes) 002 002
Ferro Alloy Realization (Rs per Tonne) 61861 63525
Power Generation Capacity (MW) 103 153
Merchant Power Realization (Rs per Unit) 350 350
Tax Rate () 20 20
Key Financial Assumptions
GPIL is expectebenefit from ongoing integrprocess and improplant cap
utilization
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 6
NANCIAL STATEMENTS AND RATIOS Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Net Sales 8266 11274 20604 20145 21898
Operating Expenditure 6960 8950 17787 17046 18440
Depreciation 342 554 677 731 813
EBIT 964 1769 2141 2368 2645
EBIT Margin () 12 16 10 12 12
Interest Expenses 337 731 1158 1099 1321
Profit Before Tax 666 1193 1096 1417 1507
Less Tax 106 198 220 283 301
Adjusted PAT 572 859 843 1032 1129
PAT Margin () 7 8 4 5 5
EPS (Rs) 18 27 27 33 36BVPS (Rs) 160 215 243 276 311
ROE 11 13 11 12 11
Valuation Ratios (x) FY13E FY14E
PER x 35 32
PB Ratio 04 04
Consolidated Profit amp Loss Statement
Particulars (Rs Mn) FY10A FY11A FY12E FY13E FY14E
Profit Before Tax 666 1193 1096 1417 1507
Depreciation 342 554 677 731 813
Other Adjustments 328 624 1158 1099 1321
Direct Tax Paid (103) (189) (220) (283) (301)
Change in Working Capital (226) (1738) 1338 (1979) (219)
Cash Flow from Operations 1008 445 4049 984 3121
Change in Fixed Assets (2499) (2458) (1637) (1878) (2131)
Other Adjustments 2 56 126 86 (5)
Cash Flow from Investment (2497) (2402) (1511) (1792) (2137)
Proceeds from Debt 1632 3429 940 4662 5158
Debt Repayment 0 0 (2613) (2848) (4785)
Interest Paid (337) (731) (1158) (1099) (1321)
Dividends Paid (82) (96) (79) (82) (76)
Others 35 522 0 0 0
Cash Flow from Financing 1248 3124 (2911) 633 (1024)
Net Cash Flows (242) 1166 (373) (175) (40)
Op bal of cash 438 196 1363 990 815
Transferred to BS 196 1363 990 815 775
Consolidated Cash Flow Statement
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 7
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Current Ratio 28 49 19 32 30
Cash Ratio 02 11 03 04 03
Interest Coverage Ratio 03 04 05 05 05
Debt Equity Ratio 10 13 12 12 11
ROCE 7 9 9 9 9
Ratio Analysis
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Application of Funds
Fixed Asset (Net) 6341 9709 13355 14503 15821
CWIP 1938 936 0 0 0
Investments 117 220 177 162 162
Other Non Current Assets 0 0 89 17 23
Inventories 1728 2872 3461 4135 4433
Sundry Debtors 372 674 959 947 993
Cash amp Bank Balance 196 1363 990 815 775
Loans amp Advances 587 1097 981 1247 1405
Other Current Assets 1 1 7 2 3
Total 11279 16872 20019 21828 23615
Sources of Funds
Share Capital 269 318 318 318 318
Reserves and Surplus 4713 5732 6463 7413 8466
Minority Interest 101 764 925 1026 1102
Total Debts 5181 8845 8998 10812 11186
Net Deferred Tax 9 (55) (67) (67) (67)
Sundry Creditors 354 727 1527 1131 1274
Other Current Liabilities 464 321 1588 796 933
Provisions 187 221 269 400 404
Total 11279 16872 20019 21828 23615
Consolidated Balance Sheet
NANCIAL STATEMENTS AND RATIOS
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 8
OARD OF DIRECTORS Director Name Current Position Description
Biswajit Choudhuri Non-Executive Independent Chairman of the Board
Shri Biswajit Choudhuri has been appointed as Non-Executive Independent Chairman of the Board of Godawari Power And Ispat Ltd effe
November 09 2011 He is a Mechanical Engineer from the Indian Institute of Technology Kharagpur and is a Fellow Member of the Institut
Cost and Works Accountants of India He is an honorary fellow member ot the Indian Institute of Banking and Finance He has over forty fo
experience in the fields of engineering management banking and finance He was the Chairman and Managing Director of the United Ban
from 1996 to 2001 He was associated with UCO Bank as an Executive Director on its board from 1992 to 1993 He has also been associated
British Oxygen Company from 1963 to 1972 as part of their management cadre He is currently on the boards of Bihar Caustic and Chemica
Orind Exports Limited Aekta Limited DIC India Limited Bengal Sunny Rock Estate Housing Development Company Limited Hindusthan E
and Industries Limited Shalzip Industries Limited and A V Investments and Dealers Limited He is not holding any shares in the Company
Dinesh GandhiNon-Independent Whole Time Director - Finance
Director
Shri Dinesh Kumar Gandhi is Non-Independent Whole Time Director - Finance Director of Godawari Power And Ispat Ltd He is a qualified
Accountant and Company secretary Mr Gandhi has more than 18 years of post qualification experience in different Industries particularly
industry in areas like Accounts Finance Project Planning and Financing He started his career at Mepco Metal Powders Ltd as Manager Fin
worked there for 4 years He then worked as an independent financial consultant to various industrial houses in Madhya Pradesh Subsequ
worked at Indore Steel amp Iron Mills Ltd and Shri Ishar Alloy Steels Ltd for a period of 7 years as Vice President (Finance ) He then joined Re
comm as Commercial Head Raipur cluster and worked there for 3 years before joining the Company
Bajrang AgrawalManaging Director Non-Independent Whole Time
Director
Shri Bajrang Lal Agrawal is Managing Director and Non-Independent Whole Time Director of Godawari Power And Ispat Ltd He is an Elect
Engineer from Pandit Ravi Shakar Shukla University Raipur While his family concentrated on setting up a tyre trading business he sought
more challenging vocation of industrial entrepreneurship He is Chairman of All India Sponge Iron Manufacturers Association (SIMA) He is
Chairman of Confederation of Indian Industries Chhattisgarh Chapter
Abhishek Agrawal Additional Non-Independent Executive Director Shri Abhishek Agrawal is serving as Additional Non-Independent Executive Director in the Board
Vinod Pillai Non-Independent Whole Time Director
Shri Vinod Pillai is Non-Independent Whole Time Director of Godawari Power And Ispat Ltd since June 1 2011 He is a Commerce Gradua
Ravi Shankar Shukla University Raipur He serves on the Board of Ms Hira Cement Limited He has experience in purchase sales liasionin
administration and logistics management He joined Ms Hira Cement Limited as Marketing Executive in the year 1989 to look after sales
administration and liasioning activities In the year 1997 he joined Ms Hira Steels Limited as Deputy General Manager (Marketing amp Liasio
was looking after the purchase of various steel items required for setting up of the project and after commissioning of the project he was
after purchase of raw materials sale of finished goods liasioning with suppliers government agencies local authorities etc He was also lo
the logistics In the year 2000 he joined Ms R R Ispat Limited as General Manager (Marketing amp Liasioning) and subsequently promoted t
President (Marketing amp Liasioning) and has been looking after similar activities like purchase of steel items required for the project sale of
goods logistics management and liasioning with various outside authorities Ms R R Ispat Limited has now been merged with the Comp
Dine sh Agra wa l No n-Ind epe nd ent Non-E xe cuti ve Dire ctor
Shri Dinesh Kumar Agrawal has been appointed as Non-Independent Non-Executive Director of Godawari Power And Ispat Ltd effective
09 2011 He is an Electronic Engineer from Pune University He is a promoter of the Company and has been associated with the technical a
Ferro Alloys Unit and the Steel Rolling Mills in the past He was the Managing Director of the Companyrsquos 100 subsidiary Ms R R Ispat Lim
has been merged with the Company He is currently involved with the day to day administration of the technical aspects of the various pro
company He has been associated with the Company since incorporation
Shashi Kumar Non-Executive Independent Director
Shri Shashi Kumar is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is a graduate from the Indian School of Min
Dhanbad and also holds an AISM Diploma in Mining He is a member of the Mining Geological and metallurgical Institute of India and the
Institute of Engineers He has around three decades of experience in the mining industry He was appointed as the technical director of Co
Limited (ldquoCILrdquo) in 2001 and from 2005 to 2006 he was appointed as CILrsquos the Chairman and Managing Director He is currently on the boar
Neyveli Lignite Corporation Limited Shyam DRI Power Limited Jessop and Company Limited and Rashmi Metahks Limited He is not hold
shares in the Company
Bhrigu Ojha Non-Executive Independent Director
Shri Bhrigu Nath Ojha is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is Bachelor of Electrical Engineering froSindri and also holds a diploma in Senior Management Program from Cranford School of Management UK He has over 40 years of exper
Power sector in building developing managing and directing Power sector organizations to success He is fully capable of and representi
organizations and undertaking high level roles and in matters related to power industry government issues commerce and media He wa
Chairman of CIGRE India High Voltage Equipment Technical Committee and a member of CIGRE International Council on Electric System
was also associated with National Thermal Power Corporation from 1996-2003
Board Of Directors
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 2
Godawari Power amp Ispat Ltd (GPIL) formally Ispat Godawari Ltd (IGL) belonging to HIRA Group of Industries
pur was incorporated in 1999 to set up an integrated steel plant with captive power generation Today GPIL is an
egrated steel manufacturer and has dominant presence in the long product segment of the steel industry mainly into
d steel wire
GPIL is an end-to-end manufacturer of mild steel wires In the process the company manufactures sponge iron
ets ferro alloys captive power wires rods steel wires oxygen gas fly ash brick and pellets GPIL is also awarded rights for
al and iron ore mining for captive consumption as a result of which the company has managed to traverse the entire
ue chain (raw material to final product) in steel wires and is now a fully integrated manufacturer
In 2007 the company was allotted a coal mine in Chhattisgarh in JV with four other companies The total coal
erve is around 243mn tonnes of that GPILrsquos share is 26 (ie 63mn tonne) On iron ore mining front GPIL was awarded
ning lease in two iron ore mine with total reserves of 15mn tonnes For both GPIL has a mining license of 06MT having Fe
ntent of 62-64 and Lump to Fine ratio of 5050 Ari Dongri captive coal mine with reserve of 7mn tonnes is operational
ce Q1FY10 Another mine at Boria Tibu with reserve of 8mn tonnes is expected to be operational in FY13 Post
mmencement of operation at the Boria Tibu the company will meet its iron ore captively and will be insulated from the
ctuation of iron ore price in spot market Moreover due to mines located in the vicinity of the plant there will be
bstantial reduction in the cost of procurement These mines have lump concentration of 50 which will be used in the
nufacturing of sponge iron Before converting it into sponge iron lump mine is converted into pellet with the help of two
nts of 06mn tonnes each As a result of this process the landed cost of the ore for sponge production will be lower which
l increase the operating margin in the upcoming years
USINESS PROFILE
GPIL Pellets (mn Tonnes) 060
Ardent Steel Pellets (mn Tonnes) 060Sponge Iron (mn Tonnes) 050
Steel Billets (mn Tonnes) 040
HB Wire (mn Tonnes) 012
Ferro Alloys (mn Tonnes) 002
Iron ore Mine (mn Tonnes) 060
Power Capacity (MW) 10300
Current Production Capacity as on FY12
Hira Ferro Alloys Ltd (51 Subsidiary) 30
Thermal 20
Wind Mill 15
Bio Mass 85
GPIL 73
Thermal 11
Waste Heat recovery 42
Bio Mass 20
Consolidated Total 103
Electricity Capacity Portolio as on FY12
Resource Location Reserves (mn Tonnes) Capacity (mn Tonnes) Status
Iron Ore Ari Dongri Chhattisgarh 7 06 Operational
Iron Ore Boria Tibu Chhattisgarh 8 06Awaiting Surface Clearence from
Forest Ministry
Iron Ore 983107983144983144983137983156983156983145983155983143983137983154983144 100 -- Received Prospecting License
Coal Nakia (GPIampLs 26 stake) 243 --Waiting for Environment and Forest
Clearence
Mining Portfolio as on FY12
GPIL is the first comto utilize lump iron omanufacture sponge
GPIL has manufacturing capof 12mn tonnes
GPIL has pgeneration capacit73MW and is expectadd 50MW in FY14
From its subsidiaryAlloys Ltd it has pgeneration capacit30MW
The company has stfocusing on business from pbusiness due to volin merchant power r
Iron ore mine at Tibu is expected toperational by FY13
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 38
June 08
wwfullertonsecuritiescoin Page | 3
uctuation in prices of raw material amp fuel GPILrsquos major raw material is iron ore and coal On the iron ore front one of two
n captive mines commenced production The other mine ie Boria Tibu also received all regulatory clearances and should
rt production soon Hence GPIL will be insulated from the fluctuation of iron ore prices in the spot market However until
th the mines start production GPILrsquos operations will continue to be affected by fluctuation in the prices of iron ore to the
ent of dependence on market purchases
On the coal front GPIL is currently meeting its coal requirement through long-term linkages with Coal India
mited and imports The prices of imported coal depend upon the global market demand and supply and linkage prices as
termined by the Ministry of Coal The company shall be insulated from price fluctuations once captive mines startoduction GPIL awaits regulatory approvals from various departments for the coal blocks it has been allotted
anges in selling prices A specific feature of steel and mining industries is their liability to cyclical changes in steel prices
critical conditions where the selling prices were almost equal to the average cost of production of sponge iron
ofitability margins gets impacted So if prices of finished products fall to such a level margins cannot be maintained
edit interest and exchange fluctuation risk Financial crisis of the economy in 2008 has led to an interbank crisis of
st reducing the levels of interbank credits and liquidity of the financial system Simultaneously increased volatility and
certainties led to increased premium in the cost of external financing The increased cost of financing may negatively
ect GPILrsquos financial results and lead to lower profitability Fluctuation of interest rates may cause variation in the value ofsting foreign currency
The level of existing rupee debt as on March 31 2011 is Rs3bn and foreign currency term loans of USD 12mn out
which 10mn is un-hedged Hence change in interest rates may have significant impact on the financial results
USINESS PROFILE
pansions in steel business GPIL signed MoUs with the Government of Chhattisgarh to undertake
Setting up of a sponge iron plant of 06mn tonnes per annum (mtpa) pig iron of 02mtpa steel billets of 06mtpa steel
olled product of 05mtpa ferro alloys of 20ktpa calcinations plant of 01mtpa and iron ore pellet plant of 3mtpa
Setting up an iron ore pellet plant with an installed capacity of 12mtpa at the organizationrsquos existing plant location at
Siltara in Raipur
pansions in power business
GPIL is foraying into the renewable energy space by setting up 50MW Solar Thermal Power Project under the Jawaharlal
Nehru National Solar Mission (JNNSM) Scheme through its 100 subsidiary Godawari Green Energy Limited (GGEL)
The company is also planning a 13GW thermal power plant through its 100 subsidiary Godawari Energy Limited (GEL)
at Raigarh Chhattisgarh
SK amp CONCERNS
The company planning to increaspellet producapacity from 0tonnes to 12mn toat its existing plaRaipur
GPIL is also planni13GW of pcapacity in Chhattis
GPIL is exposed tvolatility in the spoore and coal pricesits captive mineoperational
The company is expto gain from the firon ore and coal pr
GPIL is expected taffected due to volin currency rates asexposure from fo
currency term loans
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 4
NANCIAL PERFORMANCE In Q4FY12 the company reported 53 Y-o-Y jump in consolidated top-line and a decline of 1 Y-o-Y in bottom-
e Operating revenue and net profit for the quarter stood at Rs 7bn and Rs 03bn respectively Growth in top-line was
ed by higher saleable volume and realization across the product portfolio Steel billets ferro alloys and pellets sales
reased by 45 19 and 18 Y-o-Y respectively However sales of sponge iron and power units declined by 11 and 39
pectively On realization front there was double digit growth on Y-o-Y basis for all products expect ferro alloys On
quential basis top-line and bottom-line increased by 37 and 210
Operating margin (EBITDA) declined by 520bps Y-o-Y due to 63 Y-o-Y increase in operating expenditure
erating expenditure was higher due to 66 31 and 36 increase in raw material employee expenses and other
pense Other expense includes exchange loss of Rs 02bn on account of foreign currency transaction Thus leading to
TDA of Rs 1bn with EBITDA margin of 15 as against 20 in the same quarter last year Other income declined by 97
d stood at Rs 3mn Bottom-line reported profit of Rs 03bn due to 11 and 8 increase in interest and tax expenses
pectively Tax expenses increased by 200bps leading to an increase in effective tax rate to 22
During the quarter the company has decided to issue and allot 5mn equity warrants convertible into 5mn equity
ares of Rs 10- each on preferential basis to the promoters andor promoters group at a price of Rs 130 per equity
rrants The holders of the said equity warrants shall have an option to convert the same into equity of the company on or
fore the expiry of 18 months from the date of allotment The fund raised would be used for funding the CAPEX of the
mpany
826611274
20604 2014521898
16
21
1415
16
7 8
45 5
0
5
10
15
20
25
-
5000
10000
15000
20000
25000
FY10A FY11A FY12A FY13E FY14E
Yearly Operating Margins
Revenue (Rs Mn) EBIDTA Margin PAT Margin
4298
4940
42874810
6568
20
1512
1215
86 2 2 5
0
5
10
15
20
25
0
3500
7000
Q4FY11 Q1FY12 Q2FY12 Q3FY12 Q4FY12
Quarterly Operating Margins
Revenue (Rs mn) EBITDA Margins PAT Margins
61078383 8412 7814 7529
1424818281
2104616637 16592
30837
34437 37403 33761 3411250
35 29 35 35
00
10
20
30
40
50
0
10000
20000
30000
40000
FY10A FY11A FY12A FY13E FY14E
Yearly Operating Performance
Pellets Realization (Rs per Tonne) Sponge Iron Realization (Rs per Tonne)
HB Wire Realization (Rs per Tonne) Power Realization (Rs per Unit)
7924 7956 7930 8571 9190
19445 19404 1987321464
23441
34811
35855 36415
37818
39525
25
29 29
30
26
24
26
28
30
0
10000
20000
30000
40000
Q4FY11 Q1FY12 Q2FY12 Q3FY12 Q4FY12
Quarterly Operating Performance
Pellets Realization (Rs per Tonne) Sponge Iron Realization (Rs per Tonne)
HB Wire Realization (Rs per Tonne) Power Realization (Rs per Unit)
In Q4FY12 toincreased by 53bottom-line declineY-o-Y
Top-line growth aided by growth involume and hrealization acrossproduct profile
Bottom-line was affdue to higher inand effective tax ra
On sequential operating mincreased 272bps d
correction in keymaterial prices
On Y-o-Y basis prealization increase4 and declined byon sequential basis
Pellet production dQ4FY12 increased dimprovement in capacity utilization
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 5
GPILrsquos top-line bottom-line expected to groCAGR of 3 andrespectively FY12-14
sed on the conservative estimated given below we estimate that GPILrsquos operating revenue to grow at a CAGR of 3 over
2012-14E to Rs 22bn Furthermore due to benefits arising from the backward integration process and increased capacity
lization we further estimate that net profit would grow at a CAGR of 16 to Rs 1bn over the same period Based on a
nsolidated FY14 PE multiple of 4 the fair value for the company works out to Rs 142
er Comparison Adhunik Metaliks Ltd (AML) is a diversified player having presence across steel mining and power
ors Moreover it has presence in merchant mining business It is trading at higher multiple due to highly integrated
ness and exposure to merchant mining business However the current valuation cannot be sustained due to falling
nganese ore prices Indian Metals and Ferro Alloys Ltd (IMFL) is one of the low cost producers of ferro alloys globally due to
tive mines and power units It is trading at higher PE multiple due to stable business model (earning stability as majority of
output is tied up for long term contracts) Major concern with IMFL is that it drives around 80 of the revenue from exportness and is subjected to risk related to subdued global demand and volatility in currency exchange rates GPIL is better
ced as compared to its peers because of the benefits arising from the integration process and improving capacity utilization
s plants
EER COMPARISION
ALUATION
Peer Group Comparison
CompaniesRevenue
(Rs mn)
EBIDTA
Margin ()
PAT
Margin ()ROE
PE
(x)
PB
(x)
CMP
(Rs)
FV
(Rs)
GODAWARI POWER amp ISPAT LTD 20604 14 41 109 4 05 113 10
ADHUNIK METALIKS LTD 19674 22 02 08 39 03 34 10
INDIAN METALS amp FERRO ALLOYS LTD 11927 19 52 76 12 09 280 10
FY12 Consolidated Figures
FY13E FY14E
Total Pellet Production (mn Tonnes) 079 116
Pellet realization (Rs per Tonne) 7814 7529
Sponge Iron Production (mn Tonnes) 037 040
Sponge Iron Realization (Rs per Tonne) 16637 16592
HB Wire Production (mn Tonnes) 010 010
HB Wire Realization (Rs per Tonne) 33761 34112
Steel Billet Production (mn Tonnes) 024 026
Steel Billet Realization (Rs per Tonne) 29060 29612
Ferro Alloy Production (mn Tonnes) 002 002
Ferro Alloy Realization (Rs per Tonne) 61861 63525
Power Generation Capacity (MW) 103 153
Merchant Power Realization (Rs per Unit) 350 350
Tax Rate () 20 20
Key Financial Assumptions
GPIL is expectebenefit from ongoing integrprocess and improplant cap
utilization
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 6
NANCIAL STATEMENTS AND RATIOS Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Net Sales 8266 11274 20604 20145 21898
Operating Expenditure 6960 8950 17787 17046 18440
Depreciation 342 554 677 731 813
EBIT 964 1769 2141 2368 2645
EBIT Margin () 12 16 10 12 12
Interest Expenses 337 731 1158 1099 1321
Profit Before Tax 666 1193 1096 1417 1507
Less Tax 106 198 220 283 301
Adjusted PAT 572 859 843 1032 1129
PAT Margin () 7 8 4 5 5
EPS (Rs) 18 27 27 33 36BVPS (Rs) 160 215 243 276 311
ROE 11 13 11 12 11
Valuation Ratios (x) FY13E FY14E
PER x 35 32
PB Ratio 04 04
Consolidated Profit amp Loss Statement
Particulars (Rs Mn) FY10A FY11A FY12E FY13E FY14E
Profit Before Tax 666 1193 1096 1417 1507
Depreciation 342 554 677 731 813
Other Adjustments 328 624 1158 1099 1321
Direct Tax Paid (103) (189) (220) (283) (301)
Change in Working Capital (226) (1738) 1338 (1979) (219)
Cash Flow from Operations 1008 445 4049 984 3121
Change in Fixed Assets (2499) (2458) (1637) (1878) (2131)
Other Adjustments 2 56 126 86 (5)
Cash Flow from Investment (2497) (2402) (1511) (1792) (2137)
Proceeds from Debt 1632 3429 940 4662 5158
Debt Repayment 0 0 (2613) (2848) (4785)
Interest Paid (337) (731) (1158) (1099) (1321)
Dividends Paid (82) (96) (79) (82) (76)
Others 35 522 0 0 0
Cash Flow from Financing 1248 3124 (2911) 633 (1024)
Net Cash Flows (242) 1166 (373) (175) (40)
Op bal of cash 438 196 1363 990 815
Transferred to BS 196 1363 990 815 775
Consolidated Cash Flow Statement
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 7
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Current Ratio 28 49 19 32 30
Cash Ratio 02 11 03 04 03
Interest Coverage Ratio 03 04 05 05 05
Debt Equity Ratio 10 13 12 12 11
ROCE 7 9 9 9 9
Ratio Analysis
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Application of Funds
Fixed Asset (Net) 6341 9709 13355 14503 15821
CWIP 1938 936 0 0 0
Investments 117 220 177 162 162
Other Non Current Assets 0 0 89 17 23
Inventories 1728 2872 3461 4135 4433
Sundry Debtors 372 674 959 947 993
Cash amp Bank Balance 196 1363 990 815 775
Loans amp Advances 587 1097 981 1247 1405
Other Current Assets 1 1 7 2 3
Total 11279 16872 20019 21828 23615
Sources of Funds
Share Capital 269 318 318 318 318
Reserves and Surplus 4713 5732 6463 7413 8466
Minority Interest 101 764 925 1026 1102
Total Debts 5181 8845 8998 10812 11186
Net Deferred Tax 9 (55) (67) (67) (67)
Sundry Creditors 354 727 1527 1131 1274
Other Current Liabilities 464 321 1588 796 933
Provisions 187 221 269 400 404
Total 11279 16872 20019 21828 23615
Consolidated Balance Sheet
NANCIAL STATEMENTS AND RATIOS
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 8
OARD OF DIRECTORS Director Name Current Position Description
Biswajit Choudhuri Non-Executive Independent Chairman of the Board
Shri Biswajit Choudhuri has been appointed as Non-Executive Independent Chairman of the Board of Godawari Power And Ispat Ltd effe
November 09 2011 He is a Mechanical Engineer from the Indian Institute of Technology Kharagpur and is a Fellow Member of the Institut
Cost and Works Accountants of India He is an honorary fellow member ot the Indian Institute of Banking and Finance He has over forty fo
experience in the fields of engineering management banking and finance He was the Chairman and Managing Director of the United Ban
from 1996 to 2001 He was associated with UCO Bank as an Executive Director on its board from 1992 to 1993 He has also been associated
British Oxygen Company from 1963 to 1972 as part of their management cadre He is currently on the boards of Bihar Caustic and Chemica
Orind Exports Limited Aekta Limited DIC India Limited Bengal Sunny Rock Estate Housing Development Company Limited Hindusthan E
and Industries Limited Shalzip Industries Limited and A V Investments and Dealers Limited He is not holding any shares in the Company
Dinesh GandhiNon-Independent Whole Time Director - Finance
Director
Shri Dinesh Kumar Gandhi is Non-Independent Whole Time Director - Finance Director of Godawari Power And Ispat Ltd He is a qualified
Accountant and Company secretary Mr Gandhi has more than 18 years of post qualification experience in different Industries particularly
industry in areas like Accounts Finance Project Planning and Financing He started his career at Mepco Metal Powders Ltd as Manager Fin
worked there for 4 years He then worked as an independent financial consultant to various industrial houses in Madhya Pradesh Subsequ
worked at Indore Steel amp Iron Mills Ltd and Shri Ishar Alloy Steels Ltd for a period of 7 years as Vice President (Finance ) He then joined Re
comm as Commercial Head Raipur cluster and worked there for 3 years before joining the Company
Bajrang AgrawalManaging Director Non-Independent Whole Time
Director
Shri Bajrang Lal Agrawal is Managing Director and Non-Independent Whole Time Director of Godawari Power And Ispat Ltd He is an Elect
Engineer from Pandit Ravi Shakar Shukla University Raipur While his family concentrated on setting up a tyre trading business he sought
more challenging vocation of industrial entrepreneurship He is Chairman of All India Sponge Iron Manufacturers Association (SIMA) He is
Chairman of Confederation of Indian Industries Chhattisgarh Chapter
Abhishek Agrawal Additional Non-Independent Executive Director Shri Abhishek Agrawal is serving as Additional Non-Independent Executive Director in the Board
Vinod Pillai Non-Independent Whole Time Director
Shri Vinod Pillai is Non-Independent Whole Time Director of Godawari Power And Ispat Ltd since June 1 2011 He is a Commerce Gradua
Ravi Shankar Shukla University Raipur He serves on the Board of Ms Hira Cement Limited He has experience in purchase sales liasionin
administration and logistics management He joined Ms Hira Cement Limited as Marketing Executive in the year 1989 to look after sales
administration and liasioning activities In the year 1997 he joined Ms Hira Steels Limited as Deputy General Manager (Marketing amp Liasio
was looking after the purchase of various steel items required for setting up of the project and after commissioning of the project he was
after purchase of raw materials sale of finished goods liasioning with suppliers government agencies local authorities etc He was also lo
the logistics In the year 2000 he joined Ms R R Ispat Limited as General Manager (Marketing amp Liasioning) and subsequently promoted t
President (Marketing amp Liasioning) and has been looking after similar activities like purchase of steel items required for the project sale of
goods logistics management and liasioning with various outside authorities Ms R R Ispat Limited has now been merged with the Comp
Dine sh Agra wa l No n-Ind epe nd ent Non-E xe cuti ve Dire ctor
Shri Dinesh Kumar Agrawal has been appointed as Non-Independent Non-Executive Director of Godawari Power And Ispat Ltd effective
09 2011 He is an Electronic Engineer from Pune University He is a promoter of the Company and has been associated with the technical a
Ferro Alloys Unit and the Steel Rolling Mills in the past He was the Managing Director of the Companyrsquos 100 subsidiary Ms R R Ispat Lim
has been merged with the Company He is currently involved with the day to day administration of the technical aspects of the various pro
company He has been associated with the Company since incorporation
Shashi Kumar Non-Executive Independent Director
Shri Shashi Kumar is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is a graduate from the Indian School of Min
Dhanbad and also holds an AISM Diploma in Mining He is a member of the Mining Geological and metallurgical Institute of India and the
Institute of Engineers He has around three decades of experience in the mining industry He was appointed as the technical director of Co
Limited (ldquoCILrdquo) in 2001 and from 2005 to 2006 he was appointed as CILrsquos the Chairman and Managing Director He is currently on the boar
Neyveli Lignite Corporation Limited Shyam DRI Power Limited Jessop and Company Limited and Rashmi Metahks Limited He is not hold
shares in the Company
Bhrigu Ojha Non-Executive Independent Director
Shri Bhrigu Nath Ojha is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is Bachelor of Electrical Engineering froSindri and also holds a diploma in Senior Management Program from Cranford School of Management UK He has over 40 years of exper
Power sector in building developing managing and directing Power sector organizations to success He is fully capable of and representi
organizations and undertaking high level roles and in matters related to power industry government issues commerce and media He wa
Chairman of CIGRE India High Voltage Equipment Technical Committee and a member of CIGRE International Council on Electric System
was also associated with National Thermal Power Corporation from 1996-2003
Board Of Directors
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 38
June 08
wwfullertonsecuritiescoin Page | 3
uctuation in prices of raw material amp fuel GPILrsquos major raw material is iron ore and coal On the iron ore front one of two
n captive mines commenced production The other mine ie Boria Tibu also received all regulatory clearances and should
rt production soon Hence GPIL will be insulated from the fluctuation of iron ore prices in the spot market However until
th the mines start production GPILrsquos operations will continue to be affected by fluctuation in the prices of iron ore to the
ent of dependence on market purchases
On the coal front GPIL is currently meeting its coal requirement through long-term linkages with Coal India
mited and imports The prices of imported coal depend upon the global market demand and supply and linkage prices as
termined by the Ministry of Coal The company shall be insulated from price fluctuations once captive mines startoduction GPIL awaits regulatory approvals from various departments for the coal blocks it has been allotted
anges in selling prices A specific feature of steel and mining industries is their liability to cyclical changes in steel prices
critical conditions where the selling prices were almost equal to the average cost of production of sponge iron
ofitability margins gets impacted So if prices of finished products fall to such a level margins cannot be maintained
edit interest and exchange fluctuation risk Financial crisis of the economy in 2008 has led to an interbank crisis of
st reducing the levels of interbank credits and liquidity of the financial system Simultaneously increased volatility and
certainties led to increased premium in the cost of external financing The increased cost of financing may negatively
ect GPILrsquos financial results and lead to lower profitability Fluctuation of interest rates may cause variation in the value ofsting foreign currency
The level of existing rupee debt as on March 31 2011 is Rs3bn and foreign currency term loans of USD 12mn out
which 10mn is un-hedged Hence change in interest rates may have significant impact on the financial results
USINESS PROFILE
pansions in steel business GPIL signed MoUs with the Government of Chhattisgarh to undertake
Setting up of a sponge iron plant of 06mn tonnes per annum (mtpa) pig iron of 02mtpa steel billets of 06mtpa steel
olled product of 05mtpa ferro alloys of 20ktpa calcinations plant of 01mtpa and iron ore pellet plant of 3mtpa
Setting up an iron ore pellet plant with an installed capacity of 12mtpa at the organizationrsquos existing plant location at
Siltara in Raipur
pansions in power business
GPIL is foraying into the renewable energy space by setting up 50MW Solar Thermal Power Project under the Jawaharlal
Nehru National Solar Mission (JNNSM) Scheme through its 100 subsidiary Godawari Green Energy Limited (GGEL)
The company is also planning a 13GW thermal power plant through its 100 subsidiary Godawari Energy Limited (GEL)
at Raigarh Chhattisgarh
SK amp CONCERNS
The company planning to increaspellet producapacity from 0tonnes to 12mn toat its existing plaRaipur
GPIL is also planni13GW of pcapacity in Chhattis
GPIL is exposed tvolatility in the spoore and coal pricesits captive mineoperational
The company is expto gain from the firon ore and coal pr
GPIL is expected taffected due to volin currency rates asexposure from fo
currency term loans
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 48
June 08
wwfullertonsecuritiescoin Page | 4
NANCIAL PERFORMANCE In Q4FY12 the company reported 53 Y-o-Y jump in consolidated top-line and a decline of 1 Y-o-Y in bottom-
e Operating revenue and net profit for the quarter stood at Rs 7bn and Rs 03bn respectively Growth in top-line was
ed by higher saleable volume and realization across the product portfolio Steel billets ferro alloys and pellets sales
reased by 45 19 and 18 Y-o-Y respectively However sales of sponge iron and power units declined by 11 and 39
pectively On realization front there was double digit growth on Y-o-Y basis for all products expect ferro alloys On
quential basis top-line and bottom-line increased by 37 and 210
Operating margin (EBITDA) declined by 520bps Y-o-Y due to 63 Y-o-Y increase in operating expenditure
erating expenditure was higher due to 66 31 and 36 increase in raw material employee expenses and other
pense Other expense includes exchange loss of Rs 02bn on account of foreign currency transaction Thus leading to
TDA of Rs 1bn with EBITDA margin of 15 as against 20 in the same quarter last year Other income declined by 97
d stood at Rs 3mn Bottom-line reported profit of Rs 03bn due to 11 and 8 increase in interest and tax expenses
pectively Tax expenses increased by 200bps leading to an increase in effective tax rate to 22
During the quarter the company has decided to issue and allot 5mn equity warrants convertible into 5mn equity
ares of Rs 10- each on preferential basis to the promoters andor promoters group at a price of Rs 130 per equity
rrants The holders of the said equity warrants shall have an option to convert the same into equity of the company on or
fore the expiry of 18 months from the date of allotment The fund raised would be used for funding the CAPEX of the
mpany
826611274
20604 2014521898
16
21
1415
16
7 8
45 5
0
5
10
15
20
25
-
5000
10000
15000
20000
25000
FY10A FY11A FY12A FY13E FY14E
Yearly Operating Margins
Revenue (Rs Mn) EBIDTA Margin PAT Margin
4298
4940
42874810
6568
20
1512
1215
86 2 2 5
0
5
10
15
20
25
0
3500
7000
Q4FY11 Q1FY12 Q2FY12 Q3FY12 Q4FY12
Quarterly Operating Margins
Revenue (Rs mn) EBITDA Margins PAT Margins
61078383 8412 7814 7529
1424818281
2104616637 16592
30837
34437 37403 33761 3411250
35 29 35 35
00
10
20
30
40
50
0
10000
20000
30000
40000
FY10A FY11A FY12A FY13E FY14E
Yearly Operating Performance
Pellets Realization (Rs per Tonne) Sponge Iron Realization (Rs per Tonne)
HB Wire Realization (Rs per Tonne) Power Realization (Rs per Unit)
7924 7956 7930 8571 9190
19445 19404 1987321464
23441
34811
35855 36415
37818
39525
25
29 29
30
26
24
26
28
30
0
10000
20000
30000
40000
Q4FY11 Q1FY12 Q2FY12 Q3FY12 Q4FY12
Quarterly Operating Performance
Pellets Realization (Rs per Tonne) Sponge Iron Realization (Rs per Tonne)
HB Wire Realization (Rs per Tonne) Power Realization (Rs per Unit)
In Q4FY12 toincreased by 53bottom-line declineY-o-Y
Top-line growth aided by growth involume and hrealization acrossproduct profile
Bottom-line was affdue to higher inand effective tax ra
On sequential operating mincreased 272bps d
correction in keymaterial prices
On Y-o-Y basis prealization increase4 and declined byon sequential basis
Pellet production dQ4FY12 increased dimprovement in capacity utilization
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 58
June 08
wwfullertonsecuritiescoin Page | 5
GPILrsquos top-line bottom-line expected to groCAGR of 3 andrespectively FY12-14
sed on the conservative estimated given below we estimate that GPILrsquos operating revenue to grow at a CAGR of 3 over
2012-14E to Rs 22bn Furthermore due to benefits arising from the backward integration process and increased capacity
lization we further estimate that net profit would grow at a CAGR of 16 to Rs 1bn over the same period Based on a
nsolidated FY14 PE multiple of 4 the fair value for the company works out to Rs 142
er Comparison Adhunik Metaliks Ltd (AML) is a diversified player having presence across steel mining and power
ors Moreover it has presence in merchant mining business It is trading at higher multiple due to highly integrated
ness and exposure to merchant mining business However the current valuation cannot be sustained due to falling
nganese ore prices Indian Metals and Ferro Alloys Ltd (IMFL) is one of the low cost producers of ferro alloys globally due to
tive mines and power units It is trading at higher PE multiple due to stable business model (earning stability as majority of
output is tied up for long term contracts) Major concern with IMFL is that it drives around 80 of the revenue from exportness and is subjected to risk related to subdued global demand and volatility in currency exchange rates GPIL is better
ced as compared to its peers because of the benefits arising from the integration process and improving capacity utilization
s plants
EER COMPARISION
ALUATION
Peer Group Comparison
CompaniesRevenue
(Rs mn)
EBIDTA
Margin ()
PAT
Margin ()ROE
PE
(x)
PB
(x)
CMP
(Rs)
FV
(Rs)
GODAWARI POWER amp ISPAT LTD 20604 14 41 109 4 05 113 10
ADHUNIK METALIKS LTD 19674 22 02 08 39 03 34 10
INDIAN METALS amp FERRO ALLOYS LTD 11927 19 52 76 12 09 280 10
FY12 Consolidated Figures
FY13E FY14E
Total Pellet Production (mn Tonnes) 079 116
Pellet realization (Rs per Tonne) 7814 7529
Sponge Iron Production (mn Tonnes) 037 040
Sponge Iron Realization (Rs per Tonne) 16637 16592
HB Wire Production (mn Tonnes) 010 010
HB Wire Realization (Rs per Tonne) 33761 34112
Steel Billet Production (mn Tonnes) 024 026
Steel Billet Realization (Rs per Tonne) 29060 29612
Ferro Alloy Production (mn Tonnes) 002 002
Ferro Alloy Realization (Rs per Tonne) 61861 63525
Power Generation Capacity (MW) 103 153
Merchant Power Realization (Rs per Unit) 350 350
Tax Rate () 20 20
Key Financial Assumptions
GPIL is expectebenefit from ongoing integrprocess and improplant cap
utilization
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 68
June 08
wwfullertonsecuritiescoin Page | 6
NANCIAL STATEMENTS AND RATIOS Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Net Sales 8266 11274 20604 20145 21898
Operating Expenditure 6960 8950 17787 17046 18440
Depreciation 342 554 677 731 813
EBIT 964 1769 2141 2368 2645
EBIT Margin () 12 16 10 12 12
Interest Expenses 337 731 1158 1099 1321
Profit Before Tax 666 1193 1096 1417 1507
Less Tax 106 198 220 283 301
Adjusted PAT 572 859 843 1032 1129
PAT Margin () 7 8 4 5 5
EPS (Rs) 18 27 27 33 36BVPS (Rs) 160 215 243 276 311
ROE 11 13 11 12 11
Valuation Ratios (x) FY13E FY14E
PER x 35 32
PB Ratio 04 04
Consolidated Profit amp Loss Statement
Particulars (Rs Mn) FY10A FY11A FY12E FY13E FY14E
Profit Before Tax 666 1193 1096 1417 1507
Depreciation 342 554 677 731 813
Other Adjustments 328 624 1158 1099 1321
Direct Tax Paid (103) (189) (220) (283) (301)
Change in Working Capital (226) (1738) 1338 (1979) (219)
Cash Flow from Operations 1008 445 4049 984 3121
Change in Fixed Assets (2499) (2458) (1637) (1878) (2131)
Other Adjustments 2 56 126 86 (5)
Cash Flow from Investment (2497) (2402) (1511) (1792) (2137)
Proceeds from Debt 1632 3429 940 4662 5158
Debt Repayment 0 0 (2613) (2848) (4785)
Interest Paid (337) (731) (1158) (1099) (1321)
Dividends Paid (82) (96) (79) (82) (76)
Others 35 522 0 0 0
Cash Flow from Financing 1248 3124 (2911) 633 (1024)
Net Cash Flows (242) 1166 (373) (175) (40)
Op bal of cash 438 196 1363 990 815
Transferred to BS 196 1363 990 815 775
Consolidated Cash Flow Statement
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 7
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Current Ratio 28 49 19 32 30
Cash Ratio 02 11 03 04 03
Interest Coverage Ratio 03 04 05 05 05
Debt Equity Ratio 10 13 12 12 11
ROCE 7 9 9 9 9
Ratio Analysis
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Application of Funds
Fixed Asset (Net) 6341 9709 13355 14503 15821
CWIP 1938 936 0 0 0
Investments 117 220 177 162 162
Other Non Current Assets 0 0 89 17 23
Inventories 1728 2872 3461 4135 4433
Sundry Debtors 372 674 959 947 993
Cash amp Bank Balance 196 1363 990 815 775
Loans amp Advances 587 1097 981 1247 1405
Other Current Assets 1 1 7 2 3
Total 11279 16872 20019 21828 23615
Sources of Funds
Share Capital 269 318 318 318 318
Reserves and Surplus 4713 5732 6463 7413 8466
Minority Interest 101 764 925 1026 1102
Total Debts 5181 8845 8998 10812 11186
Net Deferred Tax 9 (55) (67) (67) (67)
Sundry Creditors 354 727 1527 1131 1274
Other Current Liabilities 464 321 1588 796 933
Provisions 187 221 269 400 404
Total 11279 16872 20019 21828 23615
Consolidated Balance Sheet
NANCIAL STATEMENTS AND RATIOS
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 8
OARD OF DIRECTORS Director Name Current Position Description
Biswajit Choudhuri Non-Executive Independent Chairman of the Board
Shri Biswajit Choudhuri has been appointed as Non-Executive Independent Chairman of the Board of Godawari Power And Ispat Ltd effe
November 09 2011 He is a Mechanical Engineer from the Indian Institute of Technology Kharagpur and is a Fellow Member of the Institut
Cost and Works Accountants of India He is an honorary fellow member ot the Indian Institute of Banking and Finance He has over forty fo
experience in the fields of engineering management banking and finance He was the Chairman and Managing Director of the United Ban
from 1996 to 2001 He was associated with UCO Bank as an Executive Director on its board from 1992 to 1993 He has also been associated
British Oxygen Company from 1963 to 1972 as part of their management cadre He is currently on the boards of Bihar Caustic and Chemica
Orind Exports Limited Aekta Limited DIC India Limited Bengal Sunny Rock Estate Housing Development Company Limited Hindusthan E
and Industries Limited Shalzip Industries Limited and A V Investments and Dealers Limited He is not holding any shares in the Company
Dinesh GandhiNon-Independent Whole Time Director - Finance
Director
Shri Dinesh Kumar Gandhi is Non-Independent Whole Time Director - Finance Director of Godawari Power And Ispat Ltd He is a qualified
Accountant and Company secretary Mr Gandhi has more than 18 years of post qualification experience in different Industries particularly
industry in areas like Accounts Finance Project Planning and Financing He started his career at Mepco Metal Powders Ltd as Manager Fin
worked there for 4 years He then worked as an independent financial consultant to various industrial houses in Madhya Pradesh Subsequ
worked at Indore Steel amp Iron Mills Ltd and Shri Ishar Alloy Steels Ltd for a period of 7 years as Vice President (Finance ) He then joined Re
comm as Commercial Head Raipur cluster and worked there for 3 years before joining the Company
Bajrang AgrawalManaging Director Non-Independent Whole Time
Director
Shri Bajrang Lal Agrawal is Managing Director and Non-Independent Whole Time Director of Godawari Power And Ispat Ltd He is an Elect
Engineer from Pandit Ravi Shakar Shukla University Raipur While his family concentrated on setting up a tyre trading business he sought
more challenging vocation of industrial entrepreneurship He is Chairman of All India Sponge Iron Manufacturers Association (SIMA) He is
Chairman of Confederation of Indian Industries Chhattisgarh Chapter
Abhishek Agrawal Additional Non-Independent Executive Director Shri Abhishek Agrawal is serving as Additional Non-Independent Executive Director in the Board
Vinod Pillai Non-Independent Whole Time Director
Shri Vinod Pillai is Non-Independent Whole Time Director of Godawari Power And Ispat Ltd since June 1 2011 He is a Commerce Gradua
Ravi Shankar Shukla University Raipur He serves on the Board of Ms Hira Cement Limited He has experience in purchase sales liasionin
administration and logistics management He joined Ms Hira Cement Limited as Marketing Executive in the year 1989 to look after sales
administration and liasioning activities In the year 1997 he joined Ms Hira Steels Limited as Deputy General Manager (Marketing amp Liasio
was looking after the purchase of various steel items required for setting up of the project and after commissioning of the project he was
after purchase of raw materials sale of finished goods liasioning with suppliers government agencies local authorities etc He was also lo
the logistics In the year 2000 he joined Ms R R Ispat Limited as General Manager (Marketing amp Liasioning) and subsequently promoted t
President (Marketing amp Liasioning) and has been looking after similar activities like purchase of steel items required for the project sale of
goods logistics management and liasioning with various outside authorities Ms R R Ispat Limited has now been merged with the Comp
Dine sh Agra wa l No n-Ind epe nd ent Non-E xe cuti ve Dire ctor
Shri Dinesh Kumar Agrawal has been appointed as Non-Independent Non-Executive Director of Godawari Power And Ispat Ltd effective
09 2011 He is an Electronic Engineer from Pune University He is a promoter of the Company and has been associated with the technical a
Ferro Alloys Unit and the Steel Rolling Mills in the past He was the Managing Director of the Companyrsquos 100 subsidiary Ms R R Ispat Lim
has been merged with the Company He is currently involved with the day to day administration of the technical aspects of the various pro
company He has been associated with the Company since incorporation
Shashi Kumar Non-Executive Independent Director
Shri Shashi Kumar is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is a graduate from the Indian School of Min
Dhanbad and also holds an AISM Diploma in Mining He is a member of the Mining Geological and metallurgical Institute of India and the
Institute of Engineers He has around three decades of experience in the mining industry He was appointed as the technical director of Co
Limited (ldquoCILrdquo) in 2001 and from 2005 to 2006 he was appointed as CILrsquos the Chairman and Managing Director He is currently on the boar
Neyveli Lignite Corporation Limited Shyam DRI Power Limited Jessop and Company Limited and Rashmi Metahks Limited He is not hold
shares in the Company
Bhrigu Ojha Non-Executive Independent Director
Shri Bhrigu Nath Ojha is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is Bachelor of Electrical Engineering froSindri and also holds a diploma in Senior Management Program from Cranford School of Management UK He has over 40 years of exper
Power sector in building developing managing and directing Power sector organizations to success He is fully capable of and representi
organizations and undertaking high level roles and in matters related to power industry government issues commerce and media He wa
Chairman of CIGRE India High Voltage Equipment Technical Committee and a member of CIGRE International Council on Electric System
was also associated with National Thermal Power Corporation from 1996-2003
Board Of Directors
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 4
NANCIAL PERFORMANCE In Q4FY12 the company reported 53 Y-o-Y jump in consolidated top-line and a decline of 1 Y-o-Y in bottom-
e Operating revenue and net profit for the quarter stood at Rs 7bn and Rs 03bn respectively Growth in top-line was
ed by higher saleable volume and realization across the product portfolio Steel billets ferro alloys and pellets sales
reased by 45 19 and 18 Y-o-Y respectively However sales of sponge iron and power units declined by 11 and 39
pectively On realization front there was double digit growth on Y-o-Y basis for all products expect ferro alloys On
quential basis top-line and bottom-line increased by 37 and 210
Operating margin (EBITDA) declined by 520bps Y-o-Y due to 63 Y-o-Y increase in operating expenditure
erating expenditure was higher due to 66 31 and 36 increase in raw material employee expenses and other
pense Other expense includes exchange loss of Rs 02bn on account of foreign currency transaction Thus leading to
TDA of Rs 1bn with EBITDA margin of 15 as against 20 in the same quarter last year Other income declined by 97
d stood at Rs 3mn Bottom-line reported profit of Rs 03bn due to 11 and 8 increase in interest and tax expenses
pectively Tax expenses increased by 200bps leading to an increase in effective tax rate to 22
During the quarter the company has decided to issue and allot 5mn equity warrants convertible into 5mn equity
ares of Rs 10- each on preferential basis to the promoters andor promoters group at a price of Rs 130 per equity
rrants The holders of the said equity warrants shall have an option to convert the same into equity of the company on or
fore the expiry of 18 months from the date of allotment The fund raised would be used for funding the CAPEX of the
mpany
826611274
20604 2014521898
16
21
1415
16
7 8
45 5
0
5
10
15
20
25
-
5000
10000
15000
20000
25000
FY10A FY11A FY12A FY13E FY14E
Yearly Operating Margins
Revenue (Rs Mn) EBIDTA Margin PAT Margin
4298
4940
42874810
6568
20
1512
1215
86 2 2 5
0
5
10
15
20
25
0
3500
7000
Q4FY11 Q1FY12 Q2FY12 Q3FY12 Q4FY12
Quarterly Operating Margins
Revenue (Rs mn) EBITDA Margins PAT Margins
61078383 8412 7814 7529
1424818281
2104616637 16592
30837
34437 37403 33761 3411250
35 29 35 35
00
10
20
30
40
50
0
10000
20000
30000
40000
FY10A FY11A FY12A FY13E FY14E
Yearly Operating Performance
Pellets Realization (Rs per Tonne) Sponge Iron Realization (Rs per Tonne)
HB Wire Realization (Rs per Tonne) Power Realization (Rs per Unit)
7924 7956 7930 8571 9190
19445 19404 1987321464
23441
34811
35855 36415
37818
39525
25
29 29
30
26
24
26
28
30
0
10000
20000
30000
40000
Q4FY11 Q1FY12 Q2FY12 Q3FY12 Q4FY12
Quarterly Operating Performance
Pellets Realization (Rs per Tonne) Sponge Iron Realization (Rs per Tonne)
HB Wire Realization (Rs per Tonne) Power Realization (Rs per Unit)
In Q4FY12 toincreased by 53bottom-line declineY-o-Y
Top-line growth aided by growth involume and hrealization acrossproduct profile
Bottom-line was affdue to higher inand effective tax ra
On sequential operating mincreased 272bps d
correction in keymaterial prices
On Y-o-Y basis prealization increase4 and declined byon sequential basis
Pellet production dQ4FY12 increased dimprovement in capacity utilization
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 58
June 08
wwfullertonsecuritiescoin Page | 5
GPILrsquos top-line bottom-line expected to groCAGR of 3 andrespectively FY12-14
sed on the conservative estimated given below we estimate that GPILrsquos operating revenue to grow at a CAGR of 3 over
2012-14E to Rs 22bn Furthermore due to benefits arising from the backward integration process and increased capacity
lization we further estimate that net profit would grow at a CAGR of 16 to Rs 1bn over the same period Based on a
nsolidated FY14 PE multiple of 4 the fair value for the company works out to Rs 142
er Comparison Adhunik Metaliks Ltd (AML) is a diversified player having presence across steel mining and power
ors Moreover it has presence in merchant mining business It is trading at higher multiple due to highly integrated
ness and exposure to merchant mining business However the current valuation cannot be sustained due to falling
nganese ore prices Indian Metals and Ferro Alloys Ltd (IMFL) is one of the low cost producers of ferro alloys globally due to
tive mines and power units It is trading at higher PE multiple due to stable business model (earning stability as majority of
output is tied up for long term contracts) Major concern with IMFL is that it drives around 80 of the revenue from exportness and is subjected to risk related to subdued global demand and volatility in currency exchange rates GPIL is better
ced as compared to its peers because of the benefits arising from the integration process and improving capacity utilization
s plants
EER COMPARISION
ALUATION
Peer Group Comparison
CompaniesRevenue
(Rs mn)
EBIDTA
Margin ()
PAT
Margin ()ROE
PE
(x)
PB
(x)
CMP
(Rs)
FV
(Rs)
GODAWARI POWER amp ISPAT LTD 20604 14 41 109 4 05 113 10
ADHUNIK METALIKS LTD 19674 22 02 08 39 03 34 10
INDIAN METALS amp FERRO ALLOYS LTD 11927 19 52 76 12 09 280 10
FY12 Consolidated Figures
FY13E FY14E
Total Pellet Production (mn Tonnes) 079 116
Pellet realization (Rs per Tonne) 7814 7529
Sponge Iron Production (mn Tonnes) 037 040
Sponge Iron Realization (Rs per Tonne) 16637 16592
HB Wire Production (mn Tonnes) 010 010
HB Wire Realization (Rs per Tonne) 33761 34112
Steel Billet Production (mn Tonnes) 024 026
Steel Billet Realization (Rs per Tonne) 29060 29612
Ferro Alloy Production (mn Tonnes) 002 002
Ferro Alloy Realization (Rs per Tonne) 61861 63525
Power Generation Capacity (MW) 103 153
Merchant Power Realization (Rs per Unit) 350 350
Tax Rate () 20 20
Key Financial Assumptions
GPIL is expectebenefit from ongoing integrprocess and improplant cap
utilization
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 68
June 08
wwfullertonsecuritiescoin Page | 6
NANCIAL STATEMENTS AND RATIOS Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Net Sales 8266 11274 20604 20145 21898
Operating Expenditure 6960 8950 17787 17046 18440
Depreciation 342 554 677 731 813
EBIT 964 1769 2141 2368 2645
EBIT Margin () 12 16 10 12 12
Interest Expenses 337 731 1158 1099 1321
Profit Before Tax 666 1193 1096 1417 1507
Less Tax 106 198 220 283 301
Adjusted PAT 572 859 843 1032 1129
PAT Margin () 7 8 4 5 5
EPS (Rs) 18 27 27 33 36BVPS (Rs) 160 215 243 276 311
ROE 11 13 11 12 11
Valuation Ratios (x) FY13E FY14E
PER x 35 32
PB Ratio 04 04
Consolidated Profit amp Loss Statement
Particulars (Rs Mn) FY10A FY11A FY12E FY13E FY14E
Profit Before Tax 666 1193 1096 1417 1507
Depreciation 342 554 677 731 813
Other Adjustments 328 624 1158 1099 1321
Direct Tax Paid (103) (189) (220) (283) (301)
Change in Working Capital (226) (1738) 1338 (1979) (219)
Cash Flow from Operations 1008 445 4049 984 3121
Change in Fixed Assets (2499) (2458) (1637) (1878) (2131)
Other Adjustments 2 56 126 86 (5)
Cash Flow from Investment (2497) (2402) (1511) (1792) (2137)
Proceeds from Debt 1632 3429 940 4662 5158
Debt Repayment 0 0 (2613) (2848) (4785)
Interest Paid (337) (731) (1158) (1099) (1321)
Dividends Paid (82) (96) (79) (82) (76)
Others 35 522 0 0 0
Cash Flow from Financing 1248 3124 (2911) 633 (1024)
Net Cash Flows (242) 1166 (373) (175) (40)
Op bal of cash 438 196 1363 990 815
Transferred to BS 196 1363 990 815 775
Consolidated Cash Flow Statement
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 7
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Current Ratio 28 49 19 32 30
Cash Ratio 02 11 03 04 03
Interest Coverage Ratio 03 04 05 05 05
Debt Equity Ratio 10 13 12 12 11
ROCE 7 9 9 9 9
Ratio Analysis
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Application of Funds
Fixed Asset (Net) 6341 9709 13355 14503 15821
CWIP 1938 936 0 0 0
Investments 117 220 177 162 162
Other Non Current Assets 0 0 89 17 23
Inventories 1728 2872 3461 4135 4433
Sundry Debtors 372 674 959 947 993
Cash amp Bank Balance 196 1363 990 815 775
Loans amp Advances 587 1097 981 1247 1405
Other Current Assets 1 1 7 2 3
Total 11279 16872 20019 21828 23615
Sources of Funds
Share Capital 269 318 318 318 318
Reserves and Surplus 4713 5732 6463 7413 8466
Minority Interest 101 764 925 1026 1102
Total Debts 5181 8845 8998 10812 11186
Net Deferred Tax 9 (55) (67) (67) (67)
Sundry Creditors 354 727 1527 1131 1274
Other Current Liabilities 464 321 1588 796 933
Provisions 187 221 269 400 404
Total 11279 16872 20019 21828 23615
Consolidated Balance Sheet
NANCIAL STATEMENTS AND RATIOS
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 88
June 08
wwfullertonsecuritiescoin Page | 8
OARD OF DIRECTORS Director Name Current Position Description
Biswajit Choudhuri Non-Executive Independent Chairman of the Board
Shri Biswajit Choudhuri has been appointed as Non-Executive Independent Chairman of the Board of Godawari Power And Ispat Ltd effe
November 09 2011 He is a Mechanical Engineer from the Indian Institute of Technology Kharagpur and is a Fellow Member of the Institut
Cost and Works Accountants of India He is an honorary fellow member ot the Indian Institute of Banking and Finance He has over forty fo
experience in the fields of engineering management banking and finance He was the Chairman and Managing Director of the United Ban
from 1996 to 2001 He was associated with UCO Bank as an Executive Director on its board from 1992 to 1993 He has also been associated
British Oxygen Company from 1963 to 1972 as part of their management cadre He is currently on the boards of Bihar Caustic and Chemica
Orind Exports Limited Aekta Limited DIC India Limited Bengal Sunny Rock Estate Housing Development Company Limited Hindusthan E
and Industries Limited Shalzip Industries Limited and A V Investments and Dealers Limited He is not holding any shares in the Company
Dinesh GandhiNon-Independent Whole Time Director - Finance
Director
Shri Dinesh Kumar Gandhi is Non-Independent Whole Time Director - Finance Director of Godawari Power And Ispat Ltd He is a qualified
Accountant and Company secretary Mr Gandhi has more than 18 years of post qualification experience in different Industries particularly
industry in areas like Accounts Finance Project Planning and Financing He started his career at Mepco Metal Powders Ltd as Manager Fin
worked there for 4 years He then worked as an independent financial consultant to various industrial houses in Madhya Pradesh Subsequ
worked at Indore Steel amp Iron Mills Ltd and Shri Ishar Alloy Steels Ltd for a period of 7 years as Vice President (Finance ) He then joined Re
comm as Commercial Head Raipur cluster and worked there for 3 years before joining the Company
Bajrang AgrawalManaging Director Non-Independent Whole Time
Director
Shri Bajrang Lal Agrawal is Managing Director and Non-Independent Whole Time Director of Godawari Power And Ispat Ltd He is an Elect
Engineer from Pandit Ravi Shakar Shukla University Raipur While his family concentrated on setting up a tyre trading business he sought
more challenging vocation of industrial entrepreneurship He is Chairman of All India Sponge Iron Manufacturers Association (SIMA) He is
Chairman of Confederation of Indian Industries Chhattisgarh Chapter
Abhishek Agrawal Additional Non-Independent Executive Director Shri Abhishek Agrawal is serving as Additional Non-Independent Executive Director in the Board
Vinod Pillai Non-Independent Whole Time Director
Shri Vinod Pillai is Non-Independent Whole Time Director of Godawari Power And Ispat Ltd since June 1 2011 He is a Commerce Gradua
Ravi Shankar Shukla University Raipur He serves on the Board of Ms Hira Cement Limited He has experience in purchase sales liasionin
administration and logistics management He joined Ms Hira Cement Limited as Marketing Executive in the year 1989 to look after sales
administration and liasioning activities In the year 1997 he joined Ms Hira Steels Limited as Deputy General Manager (Marketing amp Liasio
was looking after the purchase of various steel items required for setting up of the project and after commissioning of the project he was
after purchase of raw materials sale of finished goods liasioning with suppliers government agencies local authorities etc He was also lo
the logistics In the year 2000 he joined Ms R R Ispat Limited as General Manager (Marketing amp Liasioning) and subsequently promoted t
President (Marketing amp Liasioning) and has been looking after similar activities like purchase of steel items required for the project sale of
goods logistics management and liasioning with various outside authorities Ms R R Ispat Limited has now been merged with the Comp
Dine sh Agra wa l No n-Ind epe nd ent Non-E xe cuti ve Dire ctor
Shri Dinesh Kumar Agrawal has been appointed as Non-Independent Non-Executive Director of Godawari Power And Ispat Ltd effective
09 2011 He is an Electronic Engineer from Pune University He is a promoter of the Company and has been associated with the technical a
Ferro Alloys Unit and the Steel Rolling Mills in the past He was the Managing Director of the Companyrsquos 100 subsidiary Ms R R Ispat Lim
has been merged with the Company He is currently involved with the day to day administration of the technical aspects of the various pro
company He has been associated with the Company since incorporation
Shashi Kumar Non-Executive Independent Director
Shri Shashi Kumar is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is a graduate from the Indian School of Min
Dhanbad and also holds an AISM Diploma in Mining He is a member of the Mining Geological and metallurgical Institute of India and the
Institute of Engineers He has around three decades of experience in the mining industry He was appointed as the technical director of Co
Limited (ldquoCILrdquo) in 2001 and from 2005 to 2006 he was appointed as CILrsquos the Chairman and Managing Director He is currently on the boar
Neyveli Lignite Corporation Limited Shyam DRI Power Limited Jessop and Company Limited and Rashmi Metahks Limited He is not hold
shares in the Company
Bhrigu Ojha Non-Executive Independent Director
Shri Bhrigu Nath Ojha is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is Bachelor of Electrical Engineering froSindri and also holds a diploma in Senior Management Program from Cranford School of Management UK He has over 40 years of exper
Power sector in building developing managing and directing Power sector organizations to success He is fully capable of and representi
organizations and undertaking high level roles and in matters related to power industry government issues commerce and media He wa
Chairman of CIGRE India High Voltage Equipment Technical Committee and a member of CIGRE International Council on Electric System
was also associated with National Thermal Power Corporation from 1996-2003
Board Of Directors
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 58
June 08
wwfullertonsecuritiescoin Page | 5
GPILrsquos top-line bottom-line expected to groCAGR of 3 andrespectively FY12-14
sed on the conservative estimated given below we estimate that GPILrsquos operating revenue to grow at a CAGR of 3 over
2012-14E to Rs 22bn Furthermore due to benefits arising from the backward integration process and increased capacity
lization we further estimate that net profit would grow at a CAGR of 16 to Rs 1bn over the same period Based on a
nsolidated FY14 PE multiple of 4 the fair value for the company works out to Rs 142
er Comparison Adhunik Metaliks Ltd (AML) is a diversified player having presence across steel mining and power
ors Moreover it has presence in merchant mining business It is trading at higher multiple due to highly integrated
ness and exposure to merchant mining business However the current valuation cannot be sustained due to falling
nganese ore prices Indian Metals and Ferro Alloys Ltd (IMFL) is one of the low cost producers of ferro alloys globally due to
tive mines and power units It is trading at higher PE multiple due to stable business model (earning stability as majority of
output is tied up for long term contracts) Major concern with IMFL is that it drives around 80 of the revenue from exportness and is subjected to risk related to subdued global demand and volatility in currency exchange rates GPIL is better
ced as compared to its peers because of the benefits arising from the integration process and improving capacity utilization
s plants
EER COMPARISION
ALUATION
Peer Group Comparison
CompaniesRevenue
(Rs mn)
EBIDTA
Margin ()
PAT
Margin ()ROE
PE
(x)
PB
(x)
CMP
(Rs)
FV
(Rs)
GODAWARI POWER amp ISPAT LTD 20604 14 41 109 4 05 113 10
ADHUNIK METALIKS LTD 19674 22 02 08 39 03 34 10
INDIAN METALS amp FERRO ALLOYS LTD 11927 19 52 76 12 09 280 10
FY12 Consolidated Figures
FY13E FY14E
Total Pellet Production (mn Tonnes) 079 116
Pellet realization (Rs per Tonne) 7814 7529
Sponge Iron Production (mn Tonnes) 037 040
Sponge Iron Realization (Rs per Tonne) 16637 16592
HB Wire Production (mn Tonnes) 010 010
HB Wire Realization (Rs per Tonne) 33761 34112
Steel Billet Production (mn Tonnes) 024 026
Steel Billet Realization (Rs per Tonne) 29060 29612
Ferro Alloy Production (mn Tonnes) 002 002
Ferro Alloy Realization (Rs per Tonne) 61861 63525
Power Generation Capacity (MW) 103 153
Merchant Power Realization (Rs per Unit) 350 350
Tax Rate () 20 20
Key Financial Assumptions
GPIL is expectebenefit from ongoing integrprocess and improplant cap
utilization
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 68
June 08
wwfullertonsecuritiescoin Page | 6
NANCIAL STATEMENTS AND RATIOS Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Net Sales 8266 11274 20604 20145 21898
Operating Expenditure 6960 8950 17787 17046 18440
Depreciation 342 554 677 731 813
EBIT 964 1769 2141 2368 2645
EBIT Margin () 12 16 10 12 12
Interest Expenses 337 731 1158 1099 1321
Profit Before Tax 666 1193 1096 1417 1507
Less Tax 106 198 220 283 301
Adjusted PAT 572 859 843 1032 1129
PAT Margin () 7 8 4 5 5
EPS (Rs) 18 27 27 33 36BVPS (Rs) 160 215 243 276 311
ROE 11 13 11 12 11
Valuation Ratios (x) FY13E FY14E
PER x 35 32
PB Ratio 04 04
Consolidated Profit amp Loss Statement
Particulars (Rs Mn) FY10A FY11A FY12E FY13E FY14E
Profit Before Tax 666 1193 1096 1417 1507
Depreciation 342 554 677 731 813
Other Adjustments 328 624 1158 1099 1321
Direct Tax Paid (103) (189) (220) (283) (301)
Change in Working Capital (226) (1738) 1338 (1979) (219)
Cash Flow from Operations 1008 445 4049 984 3121
Change in Fixed Assets (2499) (2458) (1637) (1878) (2131)
Other Adjustments 2 56 126 86 (5)
Cash Flow from Investment (2497) (2402) (1511) (1792) (2137)
Proceeds from Debt 1632 3429 940 4662 5158
Debt Repayment 0 0 (2613) (2848) (4785)
Interest Paid (337) (731) (1158) (1099) (1321)
Dividends Paid (82) (96) (79) (82) (76)
Others 35 522 0 0 0
Cash Flow from Financing 1248 3124 (2911) 633 (1024)
Net Cash Flows (242) 1166 (373) (175) (40)
Op bal of cash 438 196 1363 990 815
Transferred to BS 196 1363 990 815 775
Consolidated Cash Flow Statement
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 7
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Current Ratio 28 49 19 32 30
Cash Ratio 02 11 03 04 03
Interest Coverage Ratio 03 04 05 05 05
Debt Equity Ratio 10 13 12 12 11
ROCE 7 9 9 9 9
Ratio Analysis
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Application of Funds
Fixed Asset (Net) 6341 9709 13355 14503 15821
CWIP 1938 936 0 0 0
Investments 117 220 177 162 162
Other Non Current Assets 0 0 89 17 23
Inventories 1728 2872 3461 4135 4433
Sundry Debtors 372 674 959 947 993
Cash amp Bank Balance 196 1363 990 815 775
Loans amp Advances 587 1097 981 1247 1405
Other Current Assets 1 1 7 2 3
Total 11279 16872 20019 21828 23615
Sources of Funds
Share Capital 269 318 318 318 318
Reserves and Surplus 4713 5732 6463 7413 8466
Minority Interest 101 764 925 1026 1102
Total Debts 5181 8845 8998 10812 11186
Net Deferred Tax 9 (55) (67) (67) (67)
Sundry Creditors 354 727 1527 1131 1274
Other Current Liabilities 464 321 1588 796 933
Provisions 187 221 269 400 404
Total 11279 16872 20019 21828 23615
Consolidated Balance Sheet
NANCIAL STATEMENTS AND RATIOS
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
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June 08
wwfullertonsecuritiescoin Page | 8
OARD OF DIRECTORS Director Name Current Position Description
Biswajit Choudhuri Non-Executive Independent Chairman of the Board
Shri Biswajit Choudhuri has been appointed as Non-Executive Independent Chairman of the Board of Godawari Power And Ispat Ltd effe
November 09 2011 He is a Mechanical Engineer from the Indian Institute of Technology Kharagpur and is a Fellow Member of the Institut
Cost and Works Accountants of India He is an honorary fellow member ot the Indian Institute of Banking and Finance He has over forty fo
experience in the fields of engineering management banking and finance He was the Chairman and Managing Director of the United Ban
from 1996 to 2001 He was associated with UCO Bank as an Executive Director on its board from 1992 to 1993 He has also been associated
British Oxygen Company from 1963 to 1972 as part of their management cadre He is currently on the boards of Bihar Caustic and Chemica
Orind Exports Limited Aekta Limited DIC India Limited Bengal Sunny Rock Estate Housing Development Company Limited Hindusthan E
and Industries Limited Shalzip Industries Limited and A V Investments and Dealers Limited He is not holding any shares in the Company
Dinesh GandhiNon-Independent Whole Time Director - Finance
Director
Shri Dinesh Kumar Gandhi is Non-Independent Whole Time Director - Finance Director of Godawari Power And Ispat Ltd He is a qualified
Accountant and Company secretary Mr Gandhi has more than 18 years of post qualification experience in different Industries particularly
industry in areas like Accounts Finance Project Planning and Financing He started his career at Mepco Metal Powders Ltd as Manager Fin
worked there for 4 years He then worked as an independent financial consultant to various industrial houses in Madhya Pradesh Subsequ
worked at Indore Steel amp Iron Mills Ltd and Shri Ishar Alloy Steels Ltd for a period of 7 years as Vice President (Finance ) He then joined Re
comm as Commercial Head Raipur cluster and worked there for 3 years before joining the Company
Bajrang AgrawalManaging Director Non-Independent Whole Time
Director
Shri Bajrang Lal Agrawal is Managing Director and Non-Independent Whole Time Director of Godawari Power And Ispat Ltd He is an Elect
Engineer from Pandit Ravi Shakar Shukla University Raipur While his family concentrated on setting up a tyre trading business he sought
more challenging vocation of industrial entrepreneurship He is Chairman of All India Sponge Iron Manufacturers Association (SIMA) He is
Chairman of Confederation of Indian Industries Chhattisgarh Chapter
Abhishek Agrawal Additional Non-Independent Executive Director Shri Abhishek Agrawal is serving as Additional Non-Independent Executive Director in the Board
Vinod Pillai Non-Independent Whole Time Director
Shri Vinod Pillai is Non-Independent Whole Time Director of Godawari Power And Ispat Ltd since June 1 2011 He is a Commerce Gradua
Ravi Shankar Shukla University Raipur He serves on the Board of Ms Hira Cement Limited He has experience in purchase sales liasionin
administration and logistics management He joined Ms Hira Cement Limited as Marketing Executive in the year 1989 to look after sales
administration and liasioning activities In the year 1997 he joined Ms Hira Steels Limited as Deputy General Manager (Marketing amp Liasio
was looking after the purchase of various steel items required for setting up of the project and after commissioning of the project he was
after purchase of raw materials sale of finished goods liasioning with suppliers government agencies local authorities etc He was also lo
the logistics In the year 2000 he joined Ms R R Ispat Limited as General Manager (Marketing amp Liasioning) and subsequently promoted t
President (Marketing amp Liasioning) and has been looking after similar activities like purchase of steel items required for the project sale of
goods logistics management and liasioning with various outside authorities Ms R R Ispat Limited has now been merged with the Comp
Dine sh Agra wa l No n-Ind epe nd ent Non-E xe cuti ve Dire ctor
Shri Dinesh Kumar Agrawal has been appointed as Non-Independent Non-Executive Director of Godawari Power And Ispat Ltd effective
09 2011 He is an Electronic Engineer from Pune University He is a promoter of the Company and has been associated with the technical a
Ferro Alloys Unit and the Steel Rolling Mills in the past He was the Managing Director of the Companyrsquos 100 subsidiary Ms R R Ispat Lim
has been merged with the Company He is currently involved with the day to day administration of the technical aspects of the various pro
company He has been associated with the Company since incorporation
Shashi Kumar Non-Executive Independent Director
Shri Shashi Kumar is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is a graduate from the Indian School of Min
Dhanbad and also holds an AISM Diploma in Mining He is a member of the Mining Geological and metallurgical Institute of India and the
Institute of Engineers He has around three decades of experience in the mining industry He was appointed as the technical director of Co
Limited (ldquoCILrdquo) in 2001 and from 2005 to 2006 he was appointed as CILrsquos the Chairman and Managing Director He is currently on the boar
Neyveli Lignite Corporation Limited Shyam DRI Power Limited Jessop and Company Limited and Rashmi Metahks Limited He is not hold
shares in the Company
Bhrigu Ojha Non-Executive Independent Director
Shri Bhrigu Nath Ojha is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is Bachelor of Electrical Engineering froSindri and also holds a diploma in Senior Management Program from Cranford School of Management UK He has over 40 years of exper
Power sector in building developing managing and directing Power sector organizations to success He is fully capable of and representi
organizations and undertaking high level roles and in matters related to power industry government issues commerce and media He wa
Chairman of CIGRE India High Voltage Equipment Technical Committee and a member of CIGRE International Council on Electric System
was also associated with National Thermal Power Corporation from 1996-2003
Board Of Directors
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 68
June 08
wwfullertonsecuritiescoin Page | 6
NANCIAL STATEMENTS AND RATIOS Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Net Sales 8266 11274 20604 20145 21898
Operating Expenditure 6960 8950 17787 17046 18440
Depreciation 342 554 677 731 813
EBIT 964 1769 2141 2368 2645
EBIT Margin () 12 16 10 12 12
Interest Expenses 337 731 1158 1099 1321
Profit Before Tax 666 1193 1096 1417 1507
Less Tax 106 198 220 283 301
Adjusted PAT 572 859 843 1032 1129
PAT Margin () 7 8 4 5 5
EPS (Rs) 18 27 27 33 36BVPS (Rs) 160 215 243 276 311
ROE 11 13 11 12 11
Valuation Ratios (x) FY13E FY14E
PER x 35 32
PB Ratio 04 04
Consolidated Profit amp Loss Statement
Particulars (Rs Mn) FY10A FY11A FY12E FY13E FY14E
Profit Before Tax 666 1193 1096 1417 1507
Depreciation 342 554 677 731 813
Other Adjustments 328 624 1158 1099 1321
Direct Tax Paid (103) (189) (220) (283) (301)
Change in Working Capital (226) (1738) 1338 (1979) (219)
Cash Flow from Operations 1008 445 4049 984 3121
Change in Fixed Assets (2499) (2458) (1637) (1878) (2131)
Other Adjustments 2 56 126 86 (5)
Cash Flow from Investment (2497) (2402) (1511) (1792) (2137)
Proceeds from Debt 1632 3429 940 4662 5158
Debt Repayment 0 0 (2613) (2848) (4785)
Interest Paid (337) (731) (1158) (1099) (1321)
Dividends Paid (82) (96) (79) (82) (76)
Others 35 522 0 0 0
Cash Flow from Financing 1248 3124 (2911) 633 (1024)
Net Cash Flows (242) 1166 (373) (175) (40)
Op bal of cash 438 196 1363 990 815
Transferred to BS 196 1363 990 815 775
Consolidated Cash Flow Statement
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 78
June 08
wwfullertonsecuritiescoin Page | 7
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Current Ratio 28 49 19 32 30
Cash Ratio 02 11 03 04 03
Interest Coverage Ratio 03 04 05 05 05
Debt Equity Ratio 10 13 12 12 11
ROCE 7 9 9 9 9
Ratio Analysis
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Application of Funds
Fixed Asset (Net) 6341 9709 13355 14503 15821
CWIP 1938 936 0 0 0
Investments 117 220 177 162 162
Other Non Current Assets 0 0 89 17 23
Inventories 1728 2872 3461 4135 4433
Sundry Debtors 372 674 959 947 993
Cash amp Bank Balance 196 1363 990 815 775
Loans amp Advances 587 1097 981 1247 1405
Other Current Assets 1 1 7 2 3
Total 11279 16872 20019 21828 23615
Sources of Funds
Share Capital 269 318 318 318 318
Reserves and Surplus 4713 5732 6463 7413 8466
Minority Interest 101 764 925 1026 1102
Total Debts 5181 8845 8998 10812 11186
Net Deferred Tax 9 (55) (67) (67) (67)
Sundry Creditors 354 727 1527 1131 1274
Other Current Liabilities 464 321 1588 796 933
Provisions 187 221 269 400 404
Total 11279 16872 20019 21828 23615
Consolidated Balance Sheet
NANCIAL STATEMENTS AND RATIOS
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 88
June 08
wwfullertonsecuritiescoin Page | 8
OARD OF DIRECTORS Director Name Current Position Description
Biswajit Choudhuri Non-Executive Independent Chairman of the Board
Shri Biswajit Choudhuri has been appointed as Non-Executive Independent Chairman of the Board of Godawari Power And Ispat Ltd effe
November 09 2011 He is a Mechanical Engineer from the Indian Institute of Technology Kharagpur and is a Fellow Member of the Institut
Cost and Works Accountants of India He is an honorary fellow member ot the Indian Institute of Banking and Finance He has over forty fo
experience in the fields of engineering management banking and finance He was the Chairman and Managing Director of the United Ban
from 1996 to 2001 He was associated with UCO Bank as an Executive Director on its board from 1992 to 1993 He has also been associated
British Oxygen Company from 1963 to 1972 as part of their management cadre He is currently on the boards of Bihar Caustic and Chemica
Orind Exports Limited Aekta Limited DIC India Limited Bengal Sunny Rock Estate Housing Development Company Limited Hindusthan E
and Industries Limited Shalzip Industries Limited and A V Investments and Dealers Limited He is not holding any shares in the Company
Dinesh GandhiNon-Independent Whole Time Director - Finance
Director
Shri Dinesh Kumar Gandhi is Non-Independent Whole Time Director - Finance Director of Godawari Power And Ispat Ltd He is a qualified
Accountant and Company secretary Mr Gandhi has more than 18 years of post qualification experience in different Industries particularly
industry in areas like Accounts Finance Project Planning and Financing He started his career at Mepco Metal Powders Ltd as Manager Fin
worked there for 4 years He then worked as an independent financial consultant to various industrial houses in Madhya Pradesh Subsequ
worked at Indore Steel amp Iron Mills Ltd and Shri Ishar Alloy Steels Ltd for a period of 7 years as Vice President (Finance ) He then joined Re
comm as Commercial Head Raipur cluster and worked there for 3 years before joining the Company
Bajrang AgrawalManaging Director Non-Independent Whole Time
Director
Shri Bajrang Lal Agrawal is Managing Director and Non-Independent Whole Time Director of Godawari Power And Ispat Ltd He is an Elect
Engineer from Pandit Ravi Shakar Shukla University Raipur While his family concentrated on setting up a tyre trading business he sought
more challenging vocation of industrial entrepreneurship He is Chairman of All India Sponge Iron Manufacturers Association (SIMA) He is
Chairman of Confederation of Indian Industries Chhattisgarh Chapter
Abhishek Agrawal Additional Non-Independent Executive Director Shri Abhishek Agrawal is serving as Additional Non-Independent Executive Director in the Board
Vinod Pillai Non-Independent Whole Time Director
Shri Vinod Pillai is Non-Independent Whole Time Director of Godawari Power And Ispat Ltd since June 1 2011 He is a Commerce Gradua
Ravi Shankar Shukla University Raipur He serves on the Board of Ms Hira Cement Limited He has experience in purchase sales liasionin
administration and logistics management He joined Ms Hira Cement Limited as Marketing Executive in the year 1989 to look after sales
administration and liasioning activities In the year 1997 he joined Ms Hira Steels Limited as Deputy General Manager (Marketing amp Liasio
was looking after the purchase of various steel items required for setting up of the project and after commissioning of the project he was
after purchase of raw materials sale of finished goods liasioning with suppliers government agencies local authorities etc He was also lo
the logistics In the year 2000 he joined Ms R R Ispat Limited as General Manager (Marketing amp Liasioning) and subsequently promoted t
President (Marketing amp Liasioning) and has been looking after similar activities like purchase of steel items required for the project sale of
goods logistics management and liasioning with various outside authorities Ms R R Ispat Limited has now been merged with the Comp
Dine sh Agra wa l No n-Ind epe nd ent Non-E xe cuti ve Dire ctor
Shri Dinesh Kumar Agrawal has been appointed as Non-Independent Non-Executive Director of Godawari Power And Ispat Ltd effective
09 2011 He is an Electronic Engineer from Pune University He is a promoter of the Company and has been associated with the technical a
Ferro Alloys Unit and the Steel Rolling Mills in the past He was the Managing Director of the Companyrsquos 100 subsidiary Ms R R Ispat Lim
has been merged with the Company He is currently involved with the day to day administration of the technical aspects of the various pro
company He has been associated with the Company since incorporation
Shashi Kumar Non-Executive Independent Director
Shri Shashi Kumar is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is a graduate from the Indian School of Min
Dhanbad and also holds an AISM Diploma in Mining He is a member of the Mining Geological and metallurgical Institute of India and the
Institute of Engineers He has around three decades of experience in the mining industry He was appointed as the technical director of Co
Limited (ldquoCILrdquo) in 2001 and from 2005 to 2006 he was appointed as CILrsquos the Chairman and Managing Director He is currently on the boar
Neyveli Lignite Corporation Limited Shyam DRI Power Limited Jessop and Company Limited and Rashmi Metahks Limited He is not hold
shares in the Company
Bhrigu Ojha Non-Executive Independent Director
Shri Bhrigu Nath Ojha is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is Bachelor of Electrical Engineering froSindri and also holds a diploma in Senior Management Program from Cranford School of Management UK He has over 40 years of exper
Power sector in building developing managing and directing Power sector organizations to success He is fully capable of and representi
organizations and undertaking high level roles and in matters related to power industry government issues commerce and media He wa
Chairman of CIGRE India High Voltage Equipment Technical Committee and a member of CIGRE International Council on Electric System
was also associated with National Thermal Power Corporation from 1996-2003
Board Of Directors
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 78
June 08
wwfullertonsecuritiescoin Page | 7
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Current Ratio 28 49 19 32 30
Cash Ratio 02 11 03 04 03
Interest Coverage Ratio 03 04 05 05 05
Debt Equity Ratio 10 13 12 12 11
ROCE 7 9 9 9 9
Ratio Analysis
Particulars (Rs Mn) FY10A FY11A FY12A FY13E FY14E
Application of Funds
Fixed Asset (Net) 6341 9709 13355 14503 15821
CWIP 1938 936 0 0 0
Investments 117 220 177 162 162
Other Non Current Assets 0 0 89 17 23
Inventories 1728 2872 3461 4135 4433
Sundry Debtors 372 674 959 947 993
Cash amp Bank Balance 196 1363 990 815 775
Loans amp Advances 587 1097 981 1247 1405
Other Current Assets 1 1 7 2 3
Total 11279 16872 20019 21828 23615
Sources of Funds
Share Capital 269 318 318 318 318
Reserves and Surplus 4713 5732 6463 7413 8466
Minority Interest 101 764 925 1026 1102
Total Debts 5181 8845 8998 10812 11186
Net Deferred Tax 9 (55) (67) (67) (67)
Sundry Creditors 354 727 1527 1131 1274
Other Current Liabilities 464 321 1588 796 933
Provisions 187 221 269 400 404
Total 11279 16872 20019 21828 23615
Consolidated Balance Sheet
NANCIAL STATEMENTS AND RATIOS
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 88
June 08
wwfullertonsecuritiescoin Page | 8
OARD OF DIRECTORS Director Name Current Position Description
Biswajit Choudhuri Non-Executive Independent Chairman of the Board
Shri Biswajit Choudhuri has been appointed as Non-Executive Independent Chairman of the Board of Godawari Power And Ispat Ltd effe
November 09 2011 He is a Mechanical Engineer from the Indian Institute of Technology Kharagpur and is a Fellow Member of the Institut
Cost and Works Accountants of India He is an honorary fellow member ot the Indian Institute of Banking and Finance He has over forty fo
experience in the fields of engineering management banking and finance He was the Chairman and Managing Director of the United Ban
from 1996 to 2001 He was associated with UCO Bank as an Executive Director on its board from 1992 to 1993 He has also been associated
British Oxygen Company from 1963 to 1972 as part of their management cadre He is currently on the boards of Bihar Caustic and Chemica
Orind Exports Limited Aekta Limited DIC India Limited Bengal Sunny Rock Estate Housing Development Company Limited Hindusthan E
and Industries Limited Shalzip Industries Limited and A V Investments and Dealers Limited He is not holding any shares in the Company
Dinesh GandhiNon-Independent Whole Time Director - Finance
Director
Shri Dinesh Kumar Gandhi is Non-Independent Whole Time Director - Finance Director of Godawari Power And Ispat Ltd He is a qualified
Accountant and Company secretary Mr Gandhi has more than 18 years of post qualification experience in different Industries particularly
industry in areas like Accounts Finance Project Planning and Financing He started his career at Mepco Metal Powders Ltd as Manager Fin
worked there for 4 years He then worked as an independent financial consultant to various industrial houses in Madhya Pradesh Subsequ
worked at Indore Steel amp Iron Mills Ltd and Shri Ishar Alloy Steels Ltd for a period of 7 years as Vice President (Finance ) He then joined Re
comm as Commercial Head Raipur cluster and worked there for 3 years before joining the Company
Bajrang AgrawalManaging Director Non-Independent Whole Time
Director
Shri Bajrang Lal Agrawal is Managing Director and Non-Independent Whole Time Director of Godawari Power And Ispat Ltd He is an Elect
Engineer from Pandit Ravi Shakar Shukla University Raipur While his family concentrated on setting up a tyre trading business he sought
more challenging vocation of industrial entrepreneurship He is Chairman of All India Sponge Iron Manufacturers Association (SIMA) He is
Chairman of Confederation of Indian Industries Chhattisgarh Chapter
Abhishek Agrawal Additional Non-Independent Executive Director Shri Abhishek Agrawal is serving as Additional Non-Independent Executive Director in the Board
Vinod Pillai Non-Independent Whole Time Director
Shri Vinod Pillai is Non-Independent Whole Time Director of Godawari Power And Ispat Ltd since June 1 2011 He is a Commerce Gradua
Ravi Shankar Shukla University Raipur He serves on the Board of Ms Hira Cement Limited He has experience in purchase sales liasionin
administration and logistics management He joined Ms Hira Cement Limited as Marketing Executive in the year 1989 to look after sales
administration and liasioning activities In the year 1997 he joined Ms Hira Steels Limited as Deputy General Manager (Marketing amp Liasio
was looking after the purchase of various steel items required for setting up of the project and after commissioning of the project he was
after purchase of raw materials sale of finished goods liasioning with suppliers government agencies local authorities etc He was also lo
the logistics In the year 2000 he joined Ms R R Ispat Limited as General Manager (Marketing amp Liasioning) and subsequently promoted t
President (Marketing amp Liasioning) and has been looking after similar activities like purchase of steel items required for the project sale of
goods logistics management and liasioning with various outside authorities Ms R R Ispat Limited has now been merged with the Comp
Dine sh Agra wa l No n-Ind epe nd ent Non-E xe cuti ve Dire ctor
Shri Dinesh Kumar Agrawal has been appointed as Non-Independent Non-Executive Director of Godawari Power And Ispat Ltd effective
09 2011 He is an Electronic Engineer from Pune University He is a promoter of the Company and has been associated with the technical a
Ferro Alloys Unit and the Steel Rolling Mills in the past He was the Managing Director of the Companyrsquos 100 subsidiary Ms R R Ispat Lim
has been merged with the Company He is currently involved with the day to day administration of the technical aspects of the various pro
company He has been associated with the Company since incorporation
Shashi Kumar Non-Executive Independent Director
Shri Shashi Kumar is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is a graduate from the Indian School of Min
Dhanbad and also holds an AISM Diploma in Mining He is a member of the Mining Geological and metallurgical Institute of India and the
Institute of Engineers He has around three decades of experience in the mining industry He was appointed as the technical director of Co
Limited (ldquoCILrdquo) in 2001 and from 2005 to 2006 he was appointed as CILrsquos the Chairman and Managing Director He is currently on the boar
Neyveli Lignite Corporation Limited Shyam DRI Power Limited Jessop and Company Limited and Rashmi Metahks Limited He is not hold
shares in the Company
Bhrigu Ojha Non-Executive Independent Director
Shri Bhrigu Nath Ojha is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is Bachelor of Electrical Engineering froSindri and also holds a diploma in Senior Management Program from Cranford School of Management UK He has over 40 years of exper
Power sector in building developing managing and directing Power sector organizations to success He is fully capable of and representi
organizations and undertaking high level roles and in matters related to power industry government issues commerce and media He wa
Chairman of CIGRE India High Voltage Equipment Technical Committee and a member of CIGRE International Council on Electric System
was also associated with National Thermal Power Corporation from 1996-2003
Board Of Directors
8132019 1_0_09062012Fullerton GPI Ltd 08th June 2012
httpslidepdfcomreaderfull1009062012fullerton-gpi-ltd-08th-june-2012 88
June 08
wwfullertonsecuritiescoin Page | 8
OARD OF DIRECTORS Director Name Current Position Description
Biswajit Choudhuri Non-Executive Independent Chairman of the Board
Shri Biswajit Choudhuri has been appointed as Non-Executive Independent Chairman of the Board of Godawari Power And Ispat Ltd effe
November 09 2011 He is a Mechanical Engineer from the Indian Institute of Technology Kharagpur and is a Fellow Member of the Institut
Cost and Works Accountants of India He is an honorary fellow member ot the Indian Institute of Banking and Finance He has over forty fo
experience in the fields of engineering management banking and finance He was the Chairman and Managing Director of the United Ban
from 1996 to 2001 He was associated with UCO Bank as an Executive Director on its board from 1992 to 1993 He has also been associated
British Oxygen Company from 1963 to 1972 as part of their management cadre He is currently on the boards of Bihar Caustic and Chemica
Orind Exports Limited Aekta Limited DIC India Limited Bengal Sunny Rock Estate Housing Development Company Limited Hindusthan E
and Industries Limited Shalzip Industries Limited and A V Investments and Dealers Limited He is not holding any shares in the Company
Dinesh GandhiNon-Independent Whole Time Director - Finance
Director
Shri Dinesh Kumar Gandhi is Non-Independent Whole Time Director - Finance Director of Godawari Power And Ispat Ltd He is a qualified
Accountant and Company secretary Mr Gandhi has more than 18 years of post qualification experience in different Industries particularly
industry in areas like Accounts Finance Project Planning and Financing He started his career at Mepco Metal Powders Ltd as Manager Fin
worked there for 4 years He then worked as an independent financial consultant to various industrial houses in Madhya Pradesh Subsequ
worked at Indore Steel amp Iron Mills Ltd and Shri Ishar Alloy Steels Ltd for a period of 7 years as Vice President (Finance ) He then joined Re
comm as Commercial Head Raipur cluster and worked there for 3 years before joining the Company
Bajrang AgrawalManaging Director Non-Independent Whole Time
Director
Shri Bajrang Lal Agrawal is Managing Director and Non-Independent Whole Time Director of Godawari Power And Ispat Ltd He is an Elect
Engineer from Pandit Ravi Shakar Shukla University Raipur While his family concentrated on setting up a tyre trading business he sought
more challenging vocation of industrial entrepreneurship He is Chairman of All India Sponge Iron Manufacturers Association (SIMA) He is
Chairman of Confederation of Indian Industries Chhattisgarh Chapter
Abhishek Agrawal Additional Non-Independent Executive Director Shri Abhishek Agrawal is serving as Additional Non-Independent Executive Director in the Board
Vinod Pillai Non-Independent Whole Time Director
Shri Vinod Pillai is Non-Independent Whole Time Director of Godawari Power And Ispat Ltd since June 1 2011 He is a Commerce Gradua
Ravi Shankar Shukla University Raipur He serves on the Board of Ms Hira Cement Limited He has experience in purchase sales liasionin
administration and logistics management He joined Ms Hira Cement Limited as Marketing Executive in the year 1989 to look after sales
administration and liasioning activities In the year 1997 he joined Ms Hira Steels Limited as Deputy General Manager (Marketing amp Liasio
was looking after the purchase of various steel items required for setting up of the project and after commissioning of the project he was
after purchase of raw materials sale of finished goods liasioning with suppliers government agencies local authorities etc He was also lo
the logistics In the year 2000 he joined Ms R R Ispat Limited as General Manager (Marketing amp Liasioning) and subsequently promoted t
President (Marketing amp Liasioning) and has been looking after similar activities like purchase of steel items required for the project sale of
goods logistics management and liasioning with various outside authorities Ms R R Ispat Limited has now been merged with the Comp
Dine sh Agra wa l No n-Ind epe nd ent Non-E xe cuti ve Dire ctor
Shri Dinesh Kumar Agrawal has been appointed as Non-Independent Non-Executive Director of Godawari Power And Ispat Ltd effective
09 2011 He is an Electronic Engineer from Pune University He is a promoter of the Company and has been associated with the technical a
Ferro Alloys Unit and the Steel Rolling Mills in the past He was the Managing Director of the Companyrsquos 100 subsidiary Ms R R Ispat Lim
has been merged with the Company He is currently involved with the day to day administration of the technical aspects of the various pro
company He has been associated with the Company since incorporation
Shashi Kumar Non-Executive Independent Director
Shri Shashi Kumar is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is a graduate from the Indian School of Min
Dhanbad and also holds an AISM Diploma in Mining He is a member of the Mining Geological and metallurgical Institute of India and the
Institute of Engineers He has around three decades of experience in the mining industry He was appointed as the technical director of Co
Limited (ldquoCILrdquo) in 2001 and from 2005 to 2006 he was appointed as CILrsquos the Chairman and Managing Director He is currently on the boar
Neyveli Lignite Corporation Limited Shyam DRI Power Limited Jessop and Company Limited and Rashmi Metahks Limited He is not hold
shares in the Company
Bhrigu Ojha Non-Executive Independent Director
Shri Bhrigu Nath Ojha is Non-Executive Independent Director of Godawari Power And Ispat Ltd He is Bachelor of Electrical Engineering froSindri and also holds a diploma in Senior Management Program from Cranford School of Management UK He has over 40 years of exper
Power sector in building developing managing and directing Power sector organizations to success He is fully capable of and representi
organizations and undertaking high level roles and in matters related to power industry government issues commerce and media He wa
Chairman of CIGRE India High Voltage Equipment Technical Committee and a member of CIGRE International Council on Electric System
was also associated with National Thermal Power Corporation from 1996-2003
Board Of Directors
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