Annual Report FY 2009-10 - Welspun

C rp Ltd12. Who are customers that the company has got accreditations from?The Company has got accreditations from over 50 Oil and Gas majors world wide. To list, some of them are:COMPANY NAMECOMPANY NAMECOMPANY NAMEAGIP GASCO, ABUDHABI QATAR PETROLEUMBECHTELGASCO, EGYPTRELIANCE INDUSTRIES LIMITEDBRITISH GASGAZPROM (STROYTRANSGAZ)SAIPEM, SNAMBRITISH PETROLEUMKINDER MORGANSAUDI ARAMCO (Framework Agreement)CHINA NATIONAL PETROLEUM CORPORATION MOGE, MYANMARSHELLCPMEC, CHINAN.A.O.C. - NIGERIASTOLT OFFSHORE – AcergyCHEVRON (Frame Agreement)NPCC, ABU DHABISONATRACHDOWNTPCTECHNIPRUBY (ELPASO)ONGCTOTALEGYPTIAN GENERAL PETROLEUM CORPORATION PETRO CHINATRANSCANADA (Long term contract)ENTERPRISEPETRONAS, MALAYSIA (PETROJET)UNOCALGOLDEN PASS PIPELINE LP (EXXON-MOBILE) PETROLEUM DEVELOPMENT OMAN LLC PERU LNG S.R.L. (HUNT OIL)GAILPGN, INDONESIAVIETSOPETRODebt / Inventory Position13. What is the net debt to networth ratio for the company?The Net Debt to Networth ratio for the company for FY 10 stands at 0.29 :1. This is calculated as [Gross Debt (-) Cash ]Shareholder's Equity (Share Capital + Reserves)].[Total14. What is the current gross and net debt position as at 31st March 2010?The Gross Debt (Secured & Unsecured) is Rs. 25,476 mn as at 31st March 2010. The Net Debt Position for the company is Rs. 8,448mn.15. What are the Inventory level of the Company? What is the Inventory turnover for the company during the year ?The Inventory as at 31st March 2010 stands at Rs. 20,322 mn which is lesser by Rs. 5,791 mn as compared to the previous yeardespite increase in scale of operations, reflecting lower steel prices as compared with the previous year and better inventorymanagement. The Inventory turnover ratio stands at 101 days of Net sales during the year.Others16. What is the Outlook for future in terms of business opportunity?Welspun has firmly established itself as a credible supplier in the international market. It has set up its Plants at such strategiclocations in the coastal belt of the country from where the transportation cost of the manufactured pipes to the desireddestination is low. It has also proved its capability in venturing out of India with its new pipe mill at the Little Rock Arkansas US, witha Spiral Pipe capacity of 350 K MT and also has coating, double jointing and bending facilities. This provides a one stopsolutions to its customers locally in US and the neighboring areas. Welspun is also setting up the new LSAW pipe facilities in India of350 K MT in Anjar and 200 K MT in other parts of India to cater to demands in domestic as well as international market.17. What was the Equity dilution during the year on account of fund raising activities done by the company during the year? Howmuch fund was raised and what is the planned use of proceeds by the company?The Company has raised US $ 250 mn during the year with US $ 150 mn through FCCB (Foreign Currency Convertible Bonds)redeemable after 5 years and are convertible into equity shares at a conversion price of Rs. 300 per share and US$ 100 mn throughQIP (Qualified Institutional Placements). The Equity dilution is 16.69 mn shares added during the year on account of QIP taking thetotal outstanding shares to 204.32 mn as at 31st March 2010. These funds are being used for growth initiatives of the company.18. What is the planned CAPEX for the company for the further expansion plans?The Capex planned is about Rs. 700 crores for the new capacities in Anjar of 350 K MTPA LSAW plant, HSAW 100 K MTPA atMandya, near Bangalore and another HSAW plant of 100 K MTPA in Central India by end of FY 11.19. What are the strategic initiatives taken by the company?The Company has forayed into the Infrastructure Sector and Pipe laying for oil, gas and water by way of investment in MSK ProjectsIndia Ltd., through Welspun Infratech Ltd., a 100% subsidiary of Welspun Corp. Ltd. Also it has initialed agreements for investmentin a Middle East facility with HSAW capacity of 0.27 mn tonnes.109