Electrosteel Steels Ltd - NSE

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Transcript of Electrosteel Steels Ltd - NSE

STAKEHOLDERS EMPOWERMENT SERVICES
SECTOR: STEEL REPORTING DATE: 1ST JUNE, 2016
ELECTROSTEEL STEELS LIMITED www.electrosteels.com
Electrosteel Steels Ltd 1st June, 2016 TABLE 1 - MARKET DATA (STANDALONE) (As on 31st May, 2016)
NSE Code - ESL NSE Market Price () 2.95 NSE Market Cap. (Cr.) 717.95
Sector - Steel Face Value () 10.00 Equity (Cr.) 2,409.24
52-week High/Low () 4.55/2.05 Net worth (Cr.) 1,092.84
Business Group-Indian Private TTM P/E N.A. Traded Volume (Shares) 2,74,721
Year of Incorporation - 2006 TTM P/BV 0.00 Traded Volume (lacs) 8.10
Source - Capitaline
Corporate Office: COMPANY BACKGROUND
801 Uma Shanthi Apartments, Electrosteel Integrated Ltd is a subsidiary company of Electrosteel Castings Ltd. The
company is pioneer in DI Pipes market. The company was set up as a part of backward
integration strategy by their promoter, which is in the manufacturing of DI and CI spun
pipes. The company was incorporated on 20th December, 2006 as a public limited company.
They commenced business on 5th January, 2007.
The company has made a tie up with Chinese Consultancy Agency for Technology transfer
based on successfully operating Integrated Steel Plant in various locations in China.
In May 2010, the company changed the name of the company from Electrosteel Integrated
Ltd to Electrosteel Steels Ltd. The main reason for the name change was that the new name
would convey the business of the company in a better manner, which would help the
company enjoy better market reputation and customer's reliance.
Kanke Road,
Trading Volume (Shares)
(yearly avg.) 11,09,733 9,47,666 4,35,724 17.10% 117.49% -
NSE Market Cap. (in Cr.) 710.72 975.74 1290.18 -27.16% -24.37% -25.78%
Source - Money Control
TABLE 3 - FINANCIALS
years 2015 vs 2014 2014 vs 2013
Net Worth 1,092.84 1,499.57 1,790.7 -27.12% -16.26% -21.88%
Current Assets 1,759.39 803.58 484.78 118.94% 65.76% 90.51%
Non-Current Assets 11,631.81 10,597.47 9,776.35 9.76% 8.40% 9.08%
Total Assets 13,391.2 11,401.05 10,261.14 17.46% 11.11% 14.24%
Investments 287.53 272.51 309.09 5.51% -11.83% -3.55%
Finance Cost 451.73 177.31 134.41 154.77% 31.92% 83.33%
Long Term Liabilities 8,902.27 8,331.1 6,116.17 6.86% 36.21% 20.65%
Current Liabilities 3,396.08 1,570.38 2,354.26 116.26% -33.30% 20.11%
Turnover 1,831.24 513.22 163.11 256.81% 214.65% 235.07%
Profit After Tax (PAT, Cr.) -624.04 -291.13 -280.01 N.A. N.A. N.A.
EPS () -3.00 -1.00 -1.00 N.A. N.A. N.A.
Source - Money Control/Annual Report
STAKEHOLDERS EMPOWERMENT SERVICES
SECTOR: STEEL REPORTING DATE: 1ST JUNE, 2016
ELECTROSTEEL STEELS LIMITED www.electrosteels.com
AUDIT QUALIFICATIONS
Audit Qualifications in last years: The Auditors have not raised qualifications in last three years. However, in the latest Annual
Report for FY 2014-15 they have emphasised on the following matters:
Without qualifying their opinion, they have drawn attention to Note 40 to the financial statements (Read more detail in Annual
report on page number 66), regarding the preparation of the same on a going concern basis. The Company incurred a net loss
of 624.04 crores during the year ended 31st March, 2015 and, as of that date, the Company's current liabilities exceeded its
current assets by 1,636.69 crores, further the Company's net worth has also been substantially eroded as at the balance
sheet date. However, in view of operationalisation of the other project facilities together with the increase in release of the
working capital limits and the committed infusion of funds, these financial statement have been prepared on a going concern
basis and no adjustment has been made to the carrying value of the assets and liabilities.
Response Comment
Frequency of Qualifications - Auditors have not made raised any qualification in last three
years.
TABLE 4: BOARD PROFILE (As on 31st March, 2015)
Regulatory Norms Company
% of Promoter Directors on the Board - 22.22%
Number of Women Directors on the Board At least 1 1
Classification of Chairman of the Board -
Non-Executive Independent
Director
Is the post of Chairman and MD/CEO held by the same person? - No
Average attendance of Directors in the Board meetings (%) - 81.25%
Source - Money Control/Annual Report
Composition of Board: As per Regulation 17(i)(b) of the Listing Regulations, 2015, the Company should have at least 33%
Independent Directors as the Chairman of the Board is a Non-Executive Director. The Company as on 31st march, 2015 has
44.45% of Independent Directors and hence, it meets the regulatory requirements.
Board Diversity: The Company has 9 directors out of which 8 are male and 1 is female.
STAKEHOLDERS EMPOWERMENT SERVICES
SECTOR: STEEL REPORTING DATE: 1ST JUNE, 2016
ELECTROSTEEL STEELS LIMITED www.electrosteels.com
TABLE 5 - FINANCIAL RATIOS
2015 vs 2014 2014 vs 2013
Tu rn
o ve
Fixed asset Turnover 0.16 0.05 0.02 225.08% 190.27%
Current Asset Turnover 1.04 0.64 0.34 62.97% 89.82%
R et
u rn
R at
io s Operating Profit Margin -34.08% -56.72% -170.25% N.A. N.A.
Net Profit Margin -34.08% -56.73% -171.67% N.A. N.A.
Return on Assets (ROA) -4.66% -2.55% -2.73% N.A. N.A.
Return on Equity (ROE) -57.10% -19.41% -15.64% N.A. N.A.
Return on Capital Employed (ROCE) N.A. N.A. N.A. N.A. N.A.
Li q
u id
it y
R at
io s
Working Capital Turnover ratio N.A. N.A. N.A. N.A. N.A.
So lv
en cy
R at
io s Debt to equity ratio 8.69 5.56 3.28 56.29% 69.35%
Interest Coverage Ratio N.A. N.A. N.A. N.A. N.A.
Tr ad
in g
R at
io s
Market Cap/ Net Worth 0.75 0.54 0.46 37.22% 19.41%
Market Cap/PAT N.A. N.A. N.A. N.A. N.A.
Market Cap/EBITDA 449.80 N.A. N.A. N.A. N.A.
Trading Volume (shares) (avg. of 1 year) 11,77,051 838,291 363,679 40.41% 130.50%
Trading Volume (shares) (high in 1 year) 1,12,85,256 68,91,196 22,33,511 63.76% 208.54%
Trading Volume (shares) (low in 1 year) 1,11,505 71,133 28,975 56.76% 145.50%
Ratio - High/low trading volume 101.21 96.88 77.08 4.47% 25.68%
Ratio - High/average trading volume 9.59 8.22 6.14 16.63% 33.85%
Source - Money Control
STAKEHOLDERS EMPOWERMENT SERVICES
SECTOR: STEEL REPORTING DATE: 1ST JUNE, 2016
ELECTROSTEEL STEELS LIMITED www.electrosteels.com
Dec' 2015 Dec' 2014 Dec' 2013 Comments
Sh ar
eh o
ld in
g
Promoter shareholding 45.23% 45.23% 39.64% No new equity shares were issued
during the period from Dec’2014 to
Dec’2015. There was no change in
shareholding of promoters during the
said period. The shareholding of public
institution increased from 1.48% to
29.65% and that of public others
decreased from 53.29% to 25.12%
during the same period. The promoters
have pledged 79.53% of their
shareholding.
TABLE 6 (B): OWNERSHIP & MANAGEMENT RISKS
Market Activity of Promoters The promoters have not sold/bought any shares in last fiscal year.
Preferential issue to promoters
The Company issued 22, 25, 00 ,000 of face value 10 each to the promoters of
the Company in October 2014 through preferential offering, thus increasing the
shareholding of promoters 45.23%.
Preferential issue to others No preferential issue of shares was made to other shareholders in last fiscal year.
GDRs issued by the Company The Company did not issue and GDRs during last three years
Issue of ESOPs/Issue of shares other than
Preferential allotment The Company does not have any ESOP Scheme.
Source - Annual Report
STAKEHOLDERS EMPOWERMENT SERVICES
SECTOR: STEEL REPORTING DATE: 1ST JUNE, 2016
ELECTROSTEEL STEELS LIMITED www.electrosteels.com
Equity: The equity shares capital of the Company
Net Worth: The amount by which the Assets exceeds the liabilities excluding shareholders’ funds of the Company
Turnover: The revenue earned from the operations of the Company
EPS: Earning Per Share is net profit earned by the Company per share
= Profit After Tax
Number of outstanding shares
P/E ratio: It is the ratio of the Company’s share price to earnings per share of the Company
/ = Price of each share
Earnings per share
Current Assets: Cash and other assets that are expected to be converted to cash in one year
Fixed Assets: assets which are purchased for long-term use and are not likely to be converted quickly into cash, such as land,
buildings, and equipment
Total Assets: Current Assets + Fixed Assets
Investments: An investment is an asset or item that is purchased with the hope that it will generate income or appreciate in the
future.
Finance Cost: The Financing Cost (FC), also known as the Cost of Finances (COF), is the cost and interest and other charges
incurred during the year in relation to borrowed money.
Long Term Liabilities: Long-term liabilities are liabilities with a maturity period of over one year.
Current Liabilities: A company's debts or obligations that are due within one year.
Inventory Turnover ratio: Inventory Turnover is a ratio showing how many times a company's inventory is sold and replaced over
a period.
Inventory
Debtors Turnover: Accounts receivable turnover is an efficiency ratio or activity ratio that measures how many times a business
can turn its accounts receivable into cash during a period
= Sales Turnover
Accounts recievables
Fixed Asset Turnover: The fixed-asset turnover ratio is a financial ratio of net sales to fixed assets
= Sales Turnover
Fixed Assets
Current Asset Turnover: The current-asset turnover ratio is a financial ratio of net sales to fixed assets
= Sales Turnover
Current Assets
STAKEHOLDERS EMPOWERMENT SERVICES
SECTOR: STEEL REPORTING DATE: 1ST JUNE, 2016
ELECTROSTEEL STEELS LIMITED www.electrosteels.com
Operating Profit Margin: Operating margin is a measurement of what proportion of a Company’s revenue is left over after
paying for variable costs of production such as wages, raw materials etc. It can be calculated by dividing a Company’s operating
income (also known as “operating profit”) during a given period by its sales during the same period.
= Operating profit
Sales Turnover
Net Profit Margin: Net profit margin is the percentage of revenue left after all expenses have been deducted from sales
= Net profit
Sales Turnover
Return on Assets: ROA tells you what earnings were generated from invested capital (assets)
= Net profit
Total Assets
Return on equity/net worth: return on equity (ROE) is the amount of net income returned as a percentage of shareholders’
equity.
Net worth
Return on Capital Employed: Return on capital employed (ROCE) is a financial ratio that measures a company's profitability
and the efficiency with which its capital is employed.
= Net profit
Total Debt + Equity share capital
Current ratio: The current ratio is a financial ratio that measures whether or not a firm has enough resources to pay its debts
over the next 12 months. It compares a firm's current assets to its current liabilities.
= Current Assets
Current Liabilities
Quick ratio: The quick ratio is a measure of how well a Company can meet its short term financial liabilities.
= Current Assets − Inventories
Current Liabilities
Cash ratio: The ratio of the liquid assets of a Company to its current liabilities.
= Current Assets − Inventories − Account Recievables
Current Liabilities
Working Capital Turnover ratio: The working capital turnover ratio is also referred to as net sales to working capital. It indicates a
Company's effectiveness in using its working capital.
=
Current Assets − Current Liabilities
Debt to Equity ratio: The debt-to-equity ratio (D/E) is a financial ratio indicating the relative proportion of
shareholders' equity and debt used to finance a company's assets.
= +

Interest Coverage ratio: The Interest coverage ratio is a debt ratio and profitability ratio used to determine how easily a
Company can pay interest on outstanding debt.
=

STAKEHOLDERS EMPOWERMENT SERVICES
SECTOR: STEEL REPORTING DATE: 1ST JUNE, 2016
ELECTROSTEEL STEELS LIMITED www.electrosteels.com
Market Cap/Sales ratio: Market Cap/sales ratio, Price–sales ratio, P/S ratio, or PSR, is a valuation metric for stocks. It is calculated
by dividing the company's market cap by the revenue in the most recent year; or, equivalently, divide the per-share stock price by
the per-share revenue.

Market Cap/ Net Worth ratio: It is a valuation ratio calculated by dividing Company’s market cap to net worth.
/ =

Market Cap/ PAT ratio: It is a valuation ratio calculated by dividing Company’s market cap to net profit.
/ =

Market Cap/ EBITDA ratio: It is a valuation ratio calculated by dividing Company’s market cap to EBITDA.
/ =

Trading Volume (shares) (avg. of 1 year): Average number of shares/day traded in 1 year
Trading volume (shares) (high in 1 year): Highest number of shares/day traded in 1 year
Trading volume (shares) (minimum in 1 year): Lowest number of shares traded on any one day in 1 year
STAKEHOLDERS EMPOWERMENT SERVICES
SECTOR: STEEL REPORTING DATE: 1ST JUNE, 2016
ELECTROSTEEL STEELS LIMITED www.electrosteels.com
Sources Company Information
Only publicly available data has been used while making the factsheet. Our
data sources include: BSE, NSE, SEBI, Capitaline, Moneycontrol, Businessweek,
Reuters, Annual Reports, IPO Documents and Company Website.
Analyst Certification
The analysts involved in development of this factsheet certify that no part of
any of the research analyst’s compensation was, is, or will be directly or
indirectly related to the contents of this factsheet.
Disclaimer
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