Annual Report FY 2009-10 - Welspun

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th15 Annual Report 2009-10The debentures together with interest are secured by first charge ranking pari passu by way of mortgage/hypothecationof entire immovable and movable fixed assets of the Company, both present and future and also secured bysecond/floating charge on current assets, subject to prior charge in favour of banks for working capital facilities.(ii) Non Convertible BondsNon Convertible Bonds of Rs. 456.25 million (Rs. 532.19 million) issued by the City of Little Rock / State of Arkansas aresecured by property, plant and equipment of a subsidiary.b) Term Loan from BanksI. In case of parent company Term Loans of Rs. 3,181.13 million (Rs. 10,606.32 million) are secured by first charge rankingpari passu by way of mortgage / hypothecation of entire immovable and movable fixed assets of the Company bothpresent and future and also secured by second / floating charge on current assets subject to prior charge in favour ofbanks for working capital facilities.II.III.In case of subsidiaries, Term Loan aggregating to Rs. 3,364.13 million (Rs. 4,076.01 million) is secured by property, plantand equipment, secured by pledge of secured bonds issued by the city of Little Rocks in the name of the borrower andfurther secured by corporate guarantee of the Parent Company.In case of Joint Ventures, Term Loan aggregating to Rs. 1,048.76 million (Rs. 182 million) is secured by hypothecation ofinventories, other exploration equipment, current assets etc and further secured by corporate guarantee of the ParentCompany and other venturer.c) External Commercial Borrowings (ECB)ECB of Rs. 6,789.99 million (Rs. 7,623.87 million) is secured by first charge ranking pari passu by way ofmortgage/hypothecation on entire immovable and movable fixed assets of the Company both present and future. Furtherthe ECB is secured by exclusive charge by way of hypothecation of Debt Service Reserve Account.d) Working Capital facilitiesWorking Capital facilities from banks are secured by first charge by way of hypothecation of raw materials, finished goods andgoods in process, stores & spares and book debts of the Company and second charge on entire immovable and movable fixedassets of the Company both present and future of the Company.e) Finance LeaseIn case of subsidiaries, finance Lease is secured by way of charge on equipment.21. a) Contingent Liabilities not provided forParticulars 31 March 2010(Rs. in million)31 March 2009Performance Guarantees /Bid Bond given by banks to company’s customers /government authorities etc.Corporate Guarantees givenLetters of Credit outstanding (net of liability provided) for company’s sourcingClaims against the Company not acknowledged as debtsCustom duty on pending export obligation against import of Raw Materials andMachineriesDisputed service tax /sales tax/ excise duty liabilities15,697.133,021.1415,840.2813.46561.3675.7513,648.352,822.854,769.1811.631,011.7692.37b) During the previous year one of the customer reported defect in the pipes supplied alleging grade of steel used did not meetthe specifications, the company replaced the defective pipes and also provided for the expected loss on this account. Duringthe year the said customer initiated legal action against the company in the United States of America claiming loss / damagesof $ 66 million on account of defects in the pipes supplied, consequently the company also initiated legal action against thesteel supplier claiming corresponding loss / damages it may suffer on account of this claim of the customer. Hence thecompany does not expect any liability on account of the claim against it.c) Estimated amount of contracts remaining to be executed on Capital account and not provided for Rs. 3,423.08 (Rs. 739.06million), net of advances.d) The details of Preoperative Expenses are as under:ParticularsExpenditure upto previous yearAdd : Expenditure incurred during the yearJob ChargesPower, Fuel and Water ChargesMaterial Handling and Transport ChargesSalaries, Wages and Allowances(Rs. in million)31 March 2010 31 March 2009586.60 692.220.67 -0.67 0.78- 6.6331.45 381.42100
C rp Ltd(Rs. in million)ParticularsStaff Welfare ExpensesRentRates and TaxesRepairs and Maintenance ExpenseTravelling and Conveyance Expenses (Directors Rs. NIL million (Rs. 4.50 million))Communication Expenses31 March 2010 31 March 20090.29 0.5617.12 23.533.43 0.550.32 1.541.73 28.600.17 7.46Professional and Consultancy Fees320.72 45.51Insurance5.14 13.59Vehicle Expenses0.54 1.48Security Expenses1.25 8.65Miscellaneous Expenses37.37 36.69Depreciation22.10 11.97Finance Expenses82.60 572.60Provision for Income Tax0.22 0.18Sub Total1,112.39 1,833.96Trial Run ExpensesRaw Material consumed54.75 -Stores and Spares consumed0.24 127.89Power, Fuel and Water Charges6.13 -Salary, Wages and Allowances0.41 -Selling and Distribution Expenses1.39 -Trial Run RecoveriesNet Sales(18.44) (0.54)Finished goods transferred to operation(40.05) -Net Loss4.43 127.35Less : IncomeInterest on Fixed Deposits(0.59) (0.92)Dividend received on units in mutual funds (Gross)(1.57) (0.68)Foreign Exchange Difference(3.12) (0.10)Miscellaneous Income(0.01) -Total1,111.53 1,959.61Less: Transfered on disposal of Subsidiary0.07 -Less : Amount allocated to Assets Capitalized during the year488.98 1,373.01Balance Carried to Balance Sheet 622.48 586.6022. Segment Reportingi) The Company is engaged in the business of steel products which in the opinion of the management is considered the onlybusiness segment in the context of Accounting Standard 17 on “Segment Reporting”.ii)Information about Secondary-Geographical SegmentsExternal SaleCarrying Amount ofSegment AssetsCapital Expenditure* includes deemed export Sales of Rs. 21,957.22 million (Rs. 26,655.73 million)Notes:India2009-10Outside India42,856.86* 30,645.8769,387.39 22,012.513,271.70 695.84a) Segment revenue in the geographical segments considered for disclosure is as follows:- Revenue within India includes sales to customers located within India and earnings in India.- Revenue outside India includes sales to customers located outside India, earnings outside India.b) Segment revenue, results, assets and liabilities include the respective amounts identified to eachof the segments and amounts allocated on a reasonable basis.2008-09Total India Outside India73,502.73 42,536.05 * 14,859.2291,399.90 62,804.89 20,987.953,967.54 6,675.56 5,087.51(Rs. in million)Total57,395.2783,792.8811,763.07101
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15 thAnnual Report2009-10C rp LtdFo
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C rp LtdFINANCIALS AT A GLANCEParti
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C rp LtdFinancial ScorecardAn excep
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...the journey continuesInfrastruct
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C rp Ltd• Spiral Pipe (API Grade)
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C rp LtdPARTICULARS OF EMPLOYEESAs
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01 Specific areas in which R&D is c
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WELSPUNSupplier of....Deepest Pipel
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C rp LtdCORPORATE GOVERNANCE REPORT
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) Number of Shareholders complaints
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C rp Ltd6. Stock Market price data,
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C rp Ltd16. Plant locationsi) Villa
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C rp Ltd...To global reachFROM LOCA
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C rp Ltdeconomic crisis but also sa
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C rp LtdIndian Steel Pipe Demand ov
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C rp LtdSWOT Analysis of the Indian
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C rp LtdWelspun - A SWOT analysisSt
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C rp LtdForex fluctuationsWith more
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C rp Ltd• Succession Planning pro
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C rp LtdCost of goods sold as a per
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C rp Ltdreserve account and Foreign
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C rp LtdExplanation for b) in respe
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...IT STRENGTHENS ITCHANGE DOES NOT
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Page 85 and 86: C rp LtdBALANCE SHEET ABSTRACT AND
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Annual Report FY 2009-10 - Welspun

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