CORPORATE FINANCING WITH SPECIAL REFERENCE TO BANK OF INDIA, THANE (MAIN) BRANCH

Project Report

Title: CORPORATE FINANCING WITH SPECIAL REFERENCE TO BANK OF INDIA, THANE (MAIN) BRANCH

Company: BANK OF INDIA

Submitted by Name: SUNITA NAIR MMS / PGDM: PGDBA Specialisation : FINANCE (2006-08)

SIES COLLEGE OF MANAGEMENT STUDIES (SIESCOMS)

ACKNOWLEDGEMENT
No project of such a magnitude can be completed without the support of various people whom I would like to thank. I would like to thank Mr. Meena, Chief Manager, and Mrs. Githa Nagarajan, General Manager- Credit Dept., Bank of India, Thane (Main) Branch who took time off their busy schedule and answered all my queries on the topic. Their knowledge and experience has helped me a lot in the understanding of Corporate Finance as a subject and also as the practical aspect. Also, with a deep sense of gratitude, I owe my regards to the staff of Bank of India, Thane (Main) Branch for giving their valuable time and opportunity during the course of my project. I owe my sincere gratitude to my Professors, Mr. Radhakrishnen and Mr. V.N. Kulkarni who made me realize that I have the potential to work independently and gave me their valuable suggestions and support whenever required and ensured that I could do the best in the project. Last but not the least I would also like to thank the teaching and nonteaching staff, the librarian and all those people who have directly or indirectly contributed in making this project a dream come true.

Sunita Nair

TABLE OF CONTENTS
Sr. No. 1. Executive Summary Title Page No. 5

2.

Introduction

3.

Corporate Finance

10

4.

Bank of India

16

5.

Company Evaluations

26

6.

Instruments available for Corporates

52

7.

The Road ahead

58

References

60

EXECUTIVE SUMMARY

Until the early nineties, Corporate Financial Management in India was a relatively drab and placid activity. There were not many important financial decisions to be made for the simple reason that firms were given very little freedom in the choice of key financial policies. The government regulated the price at which firms could issue equity, the rate of interest which they could offer on their bonds, and the debt equity ratio that was permissible in different industries. Moreover, most of the debt and a significant part of the equity were provided by public sector institutions. Working capital management was even more constrained with detailed regulations on how much inventory the firms could carry or how much credit they could give to their customers. Working capital was financed almost entirely by banks at interest rates laid down by the central bank. From those days of limited choices and regulated supply, Corporate Financial Management has come a long way. The last six years of financial reforms have changed all this beyond recognition. Corporate finance managers today have to choose from an array of complex financial instruments; they can now price them more or less freely; and they have access (albeit limited) to global capital markets. On the other hand, they now have to deal with a whole new breed of aggressive financial intermediaries and institutional investors; they are exposed to the volatility of interest rates and exchange rates; they have to agonize over capital structure decisions and worry about their credit ratings. If they make mistakes, they face retribution from an increasingly competitive financial marketplace, and the retribution is often swift and brutal.

These developments have been accompanied by the remarkable change in the nature and role played by Banks in Corporate Financing. Commercial Banking has been undergoing a major transformation. Traditional banks have long been exposed to strong external pressures. These pressures have been brought about by the influence of worldwide globalization and unceasing technological development. As a result we find Banks becoming more customers focussed. This project entails a study of Corporate Finance from the bankers perspective. The study was done in Bank of India, Thane (Main) Branch over a period of two months. The project covers the study of What is corporate finance? Role of Banks in corporate lending? Corporate Financing in Bank of India, Thane ( Main) Branch Evaluation of financing pattern of few corporates

INTRODUCTION
Corporate sector faces a number of financial requirements ranging from Working Capital Needs to Long term Needs. The Indian financial system is characterized by a large network of commercial banks, financial institutions, stock exchanges, and a wide range of financial instruments to suffice these needs. Working Capital Needs Commercial banks and Cooperative banks generally cater to the working capital needs of the corporate sector. Since 1992-93, commercial banks have diversified into several new areas of business like merchant banking, mutual funds, leasing, venture capital, and other financial services. Commercial and cooperative banks hold around two-thirds of total assets of the Indian banks and other financial institutions taken together. Medium and Long Term Needs

Medium and long-term finance is largely provided by Development Financial Institutions (DFIs), Investment Institutions like LIC and GIC, and mutual funds, and State-level Financial Institutions. In addition there are around 12,500 Non-Banking Financial Companies in the private sector which cater to the financing needs of the corporate sector. Stock Exchanges also serve as an important and cheaper source of funds for the corporate sector. The securities markets constitute a critical component of Indian financial markets. Presently, there are twenty two stock exchanges in the country. The Mumbai (Bombay) Stock Exchange (BSE) is the countrys oldest exchange with a formal trading activity since 1875. The National Stock Exchange has been established as a model stock exchange in 1994 for introducing scripless and screen-based trading. Stock markets have two components, namely, Primary and Secondary stock markets. A company can mobilise resources from the stock market by the issue of new shares / debentures in the primary market or by trading in the secondary market. The decline in interest rates and high profitability in the recent years has led to significant changes in the pattern of funding of the corporate sector. Internal sources are a major source of funds, thereby reducing the dependence on borrowed funds. Concomitantly, the debt- equity ratio of corporates, which averaged about 69 per cent during 1998-2002, has declined sharply to around 53 per cent in 200405 (Chart C). At the same time, the share of bank borrowings in total borrowings shows an increasing trend, suggesting that corporates have undertaken a major debt restructuring exercise, including retiring high cost debt contracted earlier (Chart D).

Resource mobilisation from the primary market through public issues (excluding offers for sale) increased by 23.1 per cent to Rs.26, 940 crore during 2005-06. The increase in resource mobilisation during 2005-06 was entirely on account of private sector companies as resources raised by public sector companies were lower than a year 10

ago. Private sector companies continued to dominate the public issues market, mobilising 78.5 per cent of the total resource mobilisation during 2005-06 as compared with 61.6 per cent during 2004-05 During the last few years, the Private Placement Market has emerged as a major route for the raising of resources by the corporate firms. With the liberalization of the financial sector since 1992, funds are also raised by Indian companies through Global Depository Receipts (GDRs), off-shore funds and other means. Buoyant stock markets provided an opportunity to corporates to raise funds from international capital markets for their investment requirements. Resources raised by Indian corporates from international capital markets during 200506 increased substantially by 238.7 per cent to Rs.11, 358 crore. Out of these, Rs.9, 779 crore were mobilized in the form of Global Depository Receipts (GDRs), followed by American Depository Receipts (ADRs) (Rs.1, 573 crore) and Foreign Currency Convertible Bonds (FCCBs) (Rs.6 crore). Most of the Euro issues were made by private non-financial companies. During 2006-07(April-June), resources raised through Euro issues by Indian corporates at Rs.5, 786 crore were substantially higher than those of Rs.1, 834 crore during the corresponding period of 2005-06.

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CORPORATE FINANCE
Running an Industrial unit involves dealing in commodities, goods, cash and various money instruments. To acquire these, the corporates need to secure finance of different types. The requirements of the corporates being of two types, namely, short-term and long-term, the nature of finance required also is of same two types. Securing both types of funds required by the corporate and their utilisation to an optimal extent to ensure that the cost of such funds is minimized are the activities which together constitute Corporate Finance. Corporates are able to generate only a minor portion (25-35%) of these finances internally, the rest has to come from external sources, if a corporate has to grow and remain profitable. Corporate Sector, therefore, has to depend heavily on the market The sources. from the market are many and varied and the

instruments of raising funds

market segments where these are floated are as many. While the initial issues (first and subsequent) are floated in the issue market, old securities (issues floated earlier) are traded in the secondary market segment of the capital markets. Capital markets are therefore, the major sources of funds for the corporate sector. However, markets are tough taskmasters and only those corporates, which perform well, can hope to secure funds from the market. Markets use a variety of parameters and tools including
ratio analysis

to gauge the performance of

a corporate. Another equally important source of funds is the borrowing from financial intermediaries i.e. Financial Institution and Commercial Banks. The methods of raising funds may vary from unit to unit and industry to industry.

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Lending by Banks Corporate or Wholesale Banking normally supplies capital for business ventures and construction activities on a long- term basis. Wholesale banking is an umbrella term encompassing the products and services that a commercial bank provides to its corporate customers. Specific products fall into one of the categories: Commercial credit Noncredit fee- based services.

Although it continues to be involved in commercial loans, a wholesale bank is no longer just a credit provider, but a fee- based service intermediary for large, medium and small businesses. Long term Commercial Loans A loan that is structured and supported specifically by the operation and performance of a specific business or enterprise is called a commercial loan. These loans are based on the proven successful or projected performance of the business itself and are totally dependent on the historical profitability of the specific operation. The purposes for longer commercial loans vary greatly, from purchases of major equipment and plant facilities to business expansion or acquisition costs. Such a long term and big league financing is usually done through Consortium Financing, Multiple Banking Arrangement or Loan Syndication. Consortium Finance: If a single bank finances a huge loan it can be exposed to a high risk of default. The necessity of consortium/ participation lending arises when the amount involved is very large and beyond what a bank would like to risk under ordinary circumstances for a single borrower beyond the prudential exposure norms. Consortium is entered into for project financing (long term 13

and working capital requirement), deferred payment guarantees etc. This participation of banks enables them to apply uniform standards, similar terms and conditions and exchange information with regard to credit proposals. The participating banks acquire common interest and share the advance and securities in the predetermined proportions. Consortium finance is again popular because there is a legal restriction that prohibits any single bank to lend more than 15% of its paid up capital and reserves to a single borrower. Participation loans mean joint finance by more than one bank to the same party against a common security. All the participating banks have a pari passu charge (a charge ranking equally in priority) on the security. Consortium financing requires one of the participating banks to act as the Lead Bank. Multiple Banking Arrangements: In this case a borrower borrows from a number of banks under separate agreements and securities are charged to them separately. Borrowers can avail any credit facilities from any number of banks without a formal consortium arrangement. This method is adopted while extending working capital limits. Loan Syndication: Syndicated Loans are available for large

established public limited companies. Loan syndication can be used to raise project finance as is done in Eurodollar market and also for working capital needs. It offers good avenue to get the appropriate level of credit as determined by the requirements of the unit rather than policy posture and price determined by credit rating of the borrower. Banks engage in syndicated lending as they need to diversify their loan portfolio in respect of country, sector, etc, both as a matter of commercial prudence and to comply with regulatory Capital Adequacy requirements. 14

 Short Term Loans Like many other activities of the banks, method and quantum of shortterm finance that can be granted to a corporate was mandated by the Reserve Bank of India till 1994. This control was exercised on the lines suggested by the recommendations of a study group headed by Shri Prakash Tandon. The study group headed by Shri Prakash Tandon, the then Chairman of Punjab National Bank, was constituted by the RBI in July 1974 with eminent personalities drawn from leading banks, financial institutions and a wide cross-section of the Industry with a view to study the entire gamut of Bank's finance for working capital and suggest ways for optimum utilisation of Bank credit. This was the first elaborate attempt by the central bank to organize the Bank credit. The report of this group is widely known as Tandon Committee Report. Most banks in India even today continue to look at the needs of the corporates in the light of methodology recommended by the Group. As per the recommendations of Tandon Committee, the corporates should be discouraged from accumulating too much of stocks of current assets and should move towards very lean inventories and receivable levels. The committee even suggested the maximum levels of Raw Material, Stock-in-process and Finished Goods which a corporate operating in an industry should be allowed to accumulate. These levels were termed as inventory and receivable norms. Depending on the size of credit required, the funding of these current assets (working capital needs) of the corporates could be met by one of the following methods: Tandon Committee Methods of assessing MPBF 15

1)

Banks can work out the working capital gap, i.e. total current

assets less current liabilities other than bank borrowings (called Maximum Permissible Bank Finance or MPBF) and finance a maximum of 75 per cent of the gap; the balance to come out of longterm funds, i.e., owned funds and term borrowings. This approach was considered suitable only for very small borrowers i.e. where the requirements of credit were less than Rs.10 lacs 2) Under this method, it was thought that the borrower should provide for a minimum of 25% of total current assets out of longterm funds i.e., owned funds plus term borrowings. A certain level of credit for purchases and other current liabilities will be available to fund the build up of current assets and the bank will provide the balance (MPBF). Consequently, total current liabilities inclusive of bank borrowings could not exceed 75% of current assets. RBI stipulated that the working capital needs of all borrowers enjoying fund based credit facilities of more than Rs. 10 lacs should be appraised (calculated) under this method. 3) Under this method, the borrower's contribution from long term funds will be to the extent of the entire CORE CURRENT ASSETS, which has been defined by the Study Group as representing the absolute minimum level of raw materials, process stock, finished goods and stores which are in the pipeline to ensure continuity of production and a minimum of 25% of the balance current assets should be financed out of the long term funds plus term borrowings. (This method was not accepted for implementation and hence is of only academic interest). As can be seen above, the basic foundation of all banks' appraisal of the needs of creditors is the level of current assets. The classification of assets and balance sheet analysis, therefore, assumes a lot of importance. RBI has mandated a certain way of analysing the balance 16

sheets. The requirements of this break-up of assets and liabilities differs slightly from that mandated by the Company Law Board (CLB). The analysis of balance sheet in CMA data is said to give a more detailed and accurate picture of the affairs of a corporate. The corporates are required by all banks to analyze their balance sheet in this specific format called CMA data format and submit to banks. While most qualified accountants working with the firms are aware of the method of classification in this format, professional help is also available in the form of Chartered Accountants, Financial Analysts for this analysis. Committees: A study group headed by Shri Prakash Tandon, the then Chairman of Punjab National Bank, was constituted by the RBI in July 1974 with eminent personalities drawn from leading banks, financial institutions and a wide cross-section of the industry with a view to study the entire gamut of Bank's finance for working capital and suggest ways for optimum utilisation of Bank credit. This was the first elaborate attempt by the central bank to organise the Bank credit. Most banks in India even today continue to look at the needs of the corporates in the light of methodology recommended by the Group. The report of this group is widely known as Tandon Committee report. The weaknesses in the Cash Credit system have persisted with the non-implementation of one of the crucial recommendations of the Committee. In the background of credit expansion seen in 1977-79 and its ill effects on the economy, RBI appointed a working group to study and suggest i) modifications in the Cash Credit system to make it amenable to better management of funds by the Bankers and ii) alternate type of credit facilities to ensure better credit discipline and co relation between credit and production. The Group was headed by Sh. K.B. Chore of RBI and was named Chore Committee. 17

Another group headed by Sh. P.R. Nayak (Nayak Committee) was entrusted the job of looking into the difficulties faced by Small Scale Industries due to the sophisticated nature of Tandon & Chore Committee recommendations. His report is applicable to units with credit requirements of less than Rs.50 lacs. The recommendations made by Tandon Committee and reinforced by Chore Committee were implemented in all Banks and Bank Credit became much more organised. However, the recommendations were perceived as too strict by the industry and there has been a continuous clamour from the Industry for movement from mandatory control to a voluntary market related restraint. With recent liberalisation of economy and reforms in the financial sector, RBI has given the freedom to the Banks to work out their own norms for inventory and the earlier norms are now to be taken as guidelines and not a mandate. In fact, beginning with the slack season credit policy of 1997-98, RBI has also given full freedom to all the Banks to devise their own method of assessing the short term credit requirements of their clients and grant lines of credit accordingly. Most banks, however, continue to be guided by the principles enunciated in Tandon Committee report. Secured and Unsecured advance When the advance given by the bank has a personal security of any individual or borrower in the absence of any tangible security the loans are treated as unsecured. Secured advances on the other hand have impersonal security i.e. the security has to a tangible asset against which the loan is granted. Primary Security is an asset against which the loan is given and

18

Collateral Security is a security which is given in addition to the existing primary security. Security can either be in the form of: Hypothecation: under this arrangement the owner of the goods (hypothecator) borrows money against the security of movable property; usually inventories. The owner does not part with the possession of the property. The rights of the lender (hypothecatee) depend upon the agreement between the lender and the borrower. Should the buyer default in paying his dues, the lender can file a suit to realize his dues by selling the goods hypothecated. Pledge: In a pledge arrangement, the owner of the goods (pledgor) deposits the goods with the lender (pledge) as security for the borrowing. Transfer of possession of goods is a precondition for pledge. The lender is expected to take reasonable care of goods pledged with him.

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BANK OF INDIA
Bank of India was founded on 7th September, 1906 by a group of eminent businessmen from Mumbai. The Bank was under private ownership and control till July 1969 when it was nationalised along with 13 other banks. Beginning with one office in Mumbai, with a paid-up capital of Rs.50 lakh and 50 employees, the Bank has made a rapid growth over the years and blossomed into a mighty institution with a strong national presence and sizable international operations. In business volume, the Bank occupies a premier position among the nationalised banks. The Bank has 2644 branches in India spread over all states/ union territories including 263 specialised branches. These branches are controlled through 48 Zonal Offices. There are 24 branches/ offices (including three representative offices) abroad. The Bank came out with its maiden public issue in 1997. Total number of shareholders as on 30/09/2006 is 2, 25,704. In the year just gone-by, the Bank crossed an enviable milestone of 100 years of its purposeful existence on 7 September 2006. Bank of India and Corporate Financing The opportunities thrown open by the robust Indian Economy were fully exploited by the Bank. Total business of the Bank grew by 29% from Rs. 160594 crore to Rs. 206673 crore. The growth in advances outpaced the growth in deposits due to strong credit demands from corporate, retail and infrastructure segments. Profit surged by 60% from Rs. 701 crore in March 2006 to Rs. 1123 crore in March, 2007. 20

This was an all time high profit recorded by the Bank. Total

gross

credit of the Bank touched Rs.86,791 crore (growth 30.2%) with domestic credit recording a growth of 29.2% to reach the level of Rs.69,811crore. The growth has been made possible with continued increase in credit off-take by large and mid sized corporates coupled with increase in SME and retail segments. The component of other than Priority Sector credit as on 31.03.2006 was Rs.32700 crore. While continuing financing activities to borrowers in the core sector where the bank has a higher exposure, the bank expanded its share in retail and SME sectors during the year, at the same time continuing its thrust on bill finance and trade finance. In the areas of corporate finance and export finance, Banks thrust has been on selective mobilisation of new clientele while at the same time nurturing existing clientele by meeting all their credit requirements. Bank has started a new syndication desk to give focussed attention in servicing corporate customers. On the technology front enabling of ecorporate module facilitated the corporates to give LC applications on line for processing at corporate branches. Bank through its 123 specialized branches caters to the various specialized segments of borrowers in Corporate Credit, Exports & Imports, Small Scale Industries, High-tech Agricultural sector, Corporate finance and Commercial and Personal segments. Eleven Corporate banking branches of the bank continue to cater exclusively to the specialized credit requirements of the Corporate borrowers. 31.03.2006 32 7 21 31.03.2007 32 7

SME branches Overseas Branches

Corporate Banking Branches Large corporate Banking Branches N.R.I Branches Capital Market Branches Agricultural hi-tech Finance Branches Recovery Branches Commercial and Personal Banking Branches Treasury Branches Housing and Personal Finance Branches Government and finance branches

9 6 2 4 13 35 1 9 1 119

9 2 6 1 4 13 36 1 11 1 123

Bank of India- Thane (Main) Branch Bank of India Thane (Main) branch has seen tremendous growth in its operation since its inception. Situated in a residential area, it attracts more deposits than lending rendering to its non- profit nature but is on among the top 125 branches of Bank of India in terms of its operations. Over the years this branch has seen its advances doubling up primarily by the bill discounting and term loans. Retail Lending forms 12% of the total lending. BoI- Thane (Main) branch has grown into a reliable name for the numerous corporates in and around Thane be it the large sized ones or the Small Scale Industries- BoI caters to the needs of all. In the areas of Corporate finance and export finance, Banks thrust has been on selective mobilisation of new clientele while at the same time nurturing existing clientele by meeting all their credit requirements. 22

The following gives a birds eye view on the performance of Bank of India (Thane Main Branch) over the last three years. March 2005 A) DEPOSITS S. B C.D TDR TOTAL Of which NRE B) ADVANCES S.S.I O.P.S Total Priority Sector C & I.C TOTAL C) NON- FUNDED BASED CREDITS Guarantee Letter of Credit TOTAL D) RETAIL BANKING Star Home Loan Star Mortgage loan Star Personal Loan Star Education Loan Star Auto fin Loan Star Holiday Loan Star Computer Loan TOTAL 446 214 660 412 70 24 60 01 01 568 474 128 602 601 108 28 80 18 01 836 396 585 981 863 179 23 125 52 02 1244 4718 1631 8225 14574 639 1210 505 1573 3288 March March

2006 2007 Rs. In Lakhs 5684 1092 11832 18608 779 1152 1030 2609 4791 5988 724 16050 22762 711 1189 1507 5161 7857

We observe a growth of 22% in the deposits while advances have recorded a growth of 62%.

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Corporate Lending in the Year Ended March 2007shows a remarkable growth of 98% over that lent in the Year ended March 2006. As we observe of the total lending done by the bank Retail contributes to 12%.

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Bank of India Thane Main branch caters to a number of Corporate Clients ranging from the large one to the Small Enterprises like those mentioned below. Medium Enterprise (Investment in P & M above Rs. 1. crore but upto Rs. 10 crores) Supreme Heattreaters (P) Ltd Vista Film & Packaging (P) Ltd Shajanand Microcoats (P) Ltd Bhatia Glass Tuffs (P) Ltd. Mid Corporation (credit Limit above Rs. 5 crores and upto Rs. 10 crore) Puranik builders Bharat Bijlee Ltd. Raymond Ltd. Escorts>> Other SME (credit limit upto Rs. 5 crores and Mortgage Loan for Business purposes) Rank Shipping Agency Saiswaroop Enterprises Kalpana Ganeshlal Jain Vijay Steel Corporation The various schemes available with Bank of India, Thane (Main) Branch are: Cash Credit: Under the cash credit system, the customer is permitted to borrow up to a pre- fixed amount called the cash credit limit. The bank charges some amount of fee for the account and interest as well. The security offered by the customer is in the nature of hypothecation or pledge. The account holder is also permitted to withdraw a certain 25

sum called limit or credit facility in excess of the amount deposited in the account. Term loans: Term loans are counterparts of fixed deposits in the bank. This type of loan is normally given to the borrowers for acquiring long-term assets, i.e. assets which will benefit the borrower over a long period. Purchases of plant and machinery, constructing building for factory, setting up new projects, financing for purchase of automobiles, consumer durables, real estate and creation of infrastructure fall in this category. Channel financing: Channel financing relates to ensuring that integrated financial and commercial solution is available to the entire chain of supply and distribution that could ensure the health of the firm, financed by the bank. In the channel financing the financing bank may have to find ways and means as to how the suppliers and buyers (dealers of the for product) all the can be financed through be various it the instruments/facilities. Hence, the channel financing adds value to the transaction parties concerned, manufacturer/trader, the supplier of the inputs or the dealer/buyer or the financing bank. The bank gains substantially from the process of channel financing which includes increased customer base, effective due diligence and smoothness of lending activity and loan origination process. Facility at BoI: Drawee bill finance for suppliers and Dealer finance. Both are trade bill oriented finance exclusively to be used for identified suppliers and Dealers of the sponsor corporate. Eligibility criteria: The suppliers and Dealers to be covered under the scheme would be identified by the sponsoring corporate. Further in the case of Dealers, they should be 26

acceptable to the Bank. For this purpose the sponsoring corporate would be required to give their opinion on the individual Dealer. Financial criteria: Should be having a satisfactory relationship with the corporate for a minimum period of three years during which time there should not be any financial delinquencies. Tenor of the facility: Maximum 90 days for both suppliers and dealers Corporate's responsibilities: In the case of Dealer finance, corporate does not have a financial responsibility to the bank. However, they should give a copy of the agreement with the dealer; should route all the business with dealers covered under the scheme only through this mechanism. The corporate should also execute a letter of comfort in favour of the bank agreeing inter-alia that they would assist the bank in recovering all the dues from the dealer declared a defaulter, stop supply to the dealer, shall pay to the bank all the dues of the dealer after adjusting their dues Bill finance: Bank of India offers finance against commercial bills in addition to collection services at competitive rates. Finance is available to all their existing customers as well as new customers. The finance is available against both demand and usance bills as well as secured and clean bills. With all important branches networked, the realization of the customers bills will be faster. If the bills are drawn under letters of Credit opened by Prime Banks, the interest rate would be much less. Corporates can avail this facility and improve their liquidity. Buyers Credit:

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Bank Guarantee: Bank of India, issues Bank Guarantees, on behalf of their customers, in favour of third parties like Government Departments, Public- Sector Organisations, etc. BoI issues both types of Guarantees viz. Performance Guarantee and Financial Guarantee. The type of Guarantee, track record of customers and their financial position are the guiding factors in deciding the Guarantee limit, security and margin. Discounting of lease rentals : This is a relatively new facility provided by Bank of India. The facility can be explained with an illustration. Supposing Individual A has property to be let out at lease, and Party B, which is a well known corporate/ bank wants it on lease. The deal is made and Party B agrees to pay the lease rental at the end of every month, Individual A can enter into an agreement with Bank of India which will discount the lease rentals. Hence Individual A gets the more in advance, bank earns the discounting charges, and Party B only has to pay the rentals to the bank. Star Mortgage Loan: A loan provided against a mortgage. The viability of such lending not only depends on the value of the mortgaged property but also on the repaying capacity of the borrower. Guided by the broad guidelines stipulated by RBI, BoI has managed to carve out a name for itself by venturing out into new and lucrative channels of financing for the corporates. A well planned out and well managed scheme always catches the attention of the corporates and hence we see the boom in the business. BoI believes in nurturing visionaries and hence ensures that no innovative and credible idea goes unimplemented because of lack of funds. Every proposal that reaches its doorstep is evaluated and scrutinized for its viability irrespective of the name and past of the borrower. Hence BoI today, 28

boosts of having formed a crucial part of many successes that were once just ideas in the minds of the promoter. As a result of which BoI has had crores of business from large corporates as well as the SMEs. Majority of their lending to the corporates have been through Bill Discounting and Term Loans. There is no resistance in lending to any particular sector, as long as the business proposal sounds good, the track record is satisfactory and the industry holds potential. These are the very factors evaluated before sanctioning of loans to the corporates, hence we see Bank of India (Thane Main Branch) restraining itself from lending to plastic business because of the environmental hazards posed by it, Real Estate business as it could lead to speculation, etc.. Among the various facilities on offer, Channel financing has given a good boost to the lending of the branch. Today technology is the key driver of the business. It not only acts as a facilitator, but also increases productivity and reduces transaction costs. As of March 2007, 1044 branches, covering about 85% business of the Bank, are on Core Banking Solution with plans of adding 500 more branches by the end of this fiscal. CBS helps banks branches to get connected within them. And hence is a great attraction for the corporates who have their business associates (dealers, suppliers) spread throughout. CBS helps in instant remittances of money without the use of drafts thereby ensuring convenience and speed. CBS has given a great boost to Bank of India in attracting the corporates. In todays competitive world with host of private and foreign banks flooding the Indian market, just having a number of innovative schemes is not all that sufficient. These very facilities need to be 29

presented marketing.

before

the

target

customers.

Hence,

the

need

for

The Bank has recognized marketing as a very important organizational function and strongly subscribes to the view that the purpose of Banks business is to create new customers, create conveniences for them and also put in place a set of customer centric processes for creating, communicating and enhancing value to customers. Hence an independent marketing department has been set up. The Bank has carved out a team of over 1000 proactive well-trained personnel for focussed marketing efforts and has placed them in strategic locations. The main focus is on garnering new Large and SME business and also encouragement of new schemes and facilities among the existing and new clients. Lending Procedure Application and Processing: A customer seeking an advance is required to submit an appropriate application form. The information furnished in the application form covers, inter alia, the following, the name and address of the borrower and his establishment; the details of the borrowers business; the nature and the amount of security offered. The application form has to be supported by various ancillary statements like the financial statements and the financial projections of the firm. The application is processed by the branch manager or his/ her field staff. This primarily involves examination of the following factors: (i) the ability, integrity and experience of the borrower of the particular business, (ii) general prospects of the borrowers business, (iii) purpose of advance, (iv) requirement of the borrower and its reasonableness, (v) adequacy of the margin, (vi) provision of security, and (vii) period of repayment.

30

Sanction, terms and Conditions: once the application is duly processed, it is put up for sanction to the appropriate authority. The sanctioning powers of various officials- like Branch Manager, Regional Manager, General Manager, etc. are defined by virtue of the position they occupy. If the sanction is given by the appropriate authority, along with the sanction of advance the bank specifies the terms and conditions applicable in advance. These usually cover the following: The amount of loan or the maximum limit of advance The nature of the advance The period for which the advance will be valid The rate of interest applicable to the advance The primary security to be charged The insurance of the security The details of the collateral security, if any, to be provided The margin to be maintained The restrictions or obligations on part of the borrower

And then the loan proposal is prepared.

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COMPANY ANALYSIS
ICI India Limited
ICI India manufactures and markets paints, specialty chemicals, adhesives & starch. The company, through its joint venture, also manufactures and markets fragrances and flavours. With employee strength of about 900, ICI India's manufacturing sites, business and sales offices and distribution network spans the length and breadth of the country ICI is a global leader in:

Paints Adhesives Food & Industrial Starches Synthetic Polymers Electronic & Engineering Materials Personal care Ingredients

Some of the famous brands belonging to ICI are Dulux Weathershield, Dulux Colour Futures, Dulux Supreme. Industry Outlook The Indian Paints Sector is valued at Rs 95 bn in value terms and is very fragmented. In volume terms, the sector posted a 15% YoY growth in FY06. The current demand is estimated to be around 650,000 tonnes per annum and is seasonal in nature. The per capita consumption of paints in India stands at 0.5 kg p.a. as compared to 1.6 kgs in China and 22 kgs in the developed economies. Hence, there 32

is immense potential in the country. The unorganised sector controls around 35% of the paint market, with the organised sector accounting for the balance. In the unorganised segment, there are about 2,000 units having small and medium sized paints manufacturing plants. Top organised players include Asian Paints (44% market share), Kansai Nerolac (20% market share), Berger Paints (17% market share) and ICI (12% market share). The organised sector has grown at a CAGR of 11.5% in the last five years. The performance highlights of the company are: Chang e 2006-07 2005-06 (Rs. In Crores) 954.3 907.8 164.9 121.9 -22.5 -21.8 -2.3 -3.6 140.1 446.1 586.2 -137.8 448.4 96.5 -11 85.5 -35.3 50.2 ( %) 5 37 46

Total Income Operating profit Depreciation Interest Profit before tax from operations Exceptional items Profit before tax Tax Profit after tax

586 793

Exceptional items consist of profit from divestment of Uniqema and Advanced Refinish Businesses and the sale of Company's shareholding in Quest International India Ltd. Sales and profit during 2006-07 recorded a strong growth of 21% and 43% respectively. Financial Analysis Ratios 33 2006-07 2005-06

Debt Equity Ratio Current Ratio Quick Ratio Gross Profit Ratio Net Profit Ratio Debtors turnover Ratio Average Collection Period Inventory Turnover Ratio Interest Coverage Ratio ROCE Working Capital Performance Ratio

0.00%-No debt 0.81 0.51 18.56% 50.47% 6.42 56.85 6.99 62.18 861% 0.86

0.00%-No debt 0.93 0.55 13.92% 5.72% 7.44 49.05 6.97 27.58 39% 0.63

Liquidity Position: Liquidity refers to the firms ability to meet its financial obligations in the short term which is less than a year. ICI seems not to be in a good liquidity position as can be understood from the lower Current and Quick ratios. Working Capital Performance Ratio refers to the sources through which debtors of a firm are financed. A ratio more than 2 indicates a better ability to meet ongoing and unexpected bill payments. ICI has a ratio less than 2 indicating that company may have difficulties meeting its short term commitments and that additional working capital is required. Turnover ratios: A low debtors turnover ratio indicates a poor receivables management but ICI seems to balance it out with a far stretched payable period.
CREDITORS RATIO DEBTORS RATIO BILLS PAYABLE+SUNDRY/TOTAL CREDIT PURCH.*365 BILLS RECEIVABLE+SUNDRY/TOTAL CREDIT SALES*365 118.775 8 56.8568 6

As we can see that though ICI India Ltd.s Liquidity position is not very good, it enjoys favorable credit terms with respect to their creditors and debtors. Hence we can conclude 34 that through proper

management of time buckets ICI India Ltd. manages to meet its obligations as short trade creditors are financed through the trade debtors. Profitability Position: The company as mentioned above is in a very profitable situation with its profitability increasing over the years. Return on Capital employed measures how well the long term funds of owners and creditors are used. The higher the ratio the more efficient the utilization of capital employed and this seems to be the situation in ICI India Ltd. Leverage Position: ICI India ltd is a debt free company. It has raised no debt since the last two years. Financing Bankers Central Bank of India Deutsche Bank AG Citibank NA Hongkong & Shanghai Banking Corporation Standard Chartered Bank ICI is a debt free company. It has not raised any loan in the last two years. The only debt on its balance sheet as a 31 st march 2007 is the deferred tax liability. one reason could be the well management of working capital requirements. Also ICI does not have any capital expenditure plan in the near future. ICI seems to be a company which believes in plouging back its profits into business as can be seen from the huge increase in the reserves and surplus (62%).

35

Also financial analysis shows a good servicing/ repayment capacity of the company which is on a rise. Future Prospects The outlook for 2007-08 appears positive for the business. The government's thrust on infrastructure and continuance of tax incentives on home loans and reduced custom duties on inputs will have a favorable impact on the paints industry. However rising crude prices, partly cushioned by a strong rupee, will impact input costs leading to pressure on margins. The increase in interest rates could adversely affect the housing and automobile sectors, which in turn may lead to a slow down in the demand for paints. ICI India Ltd. aims to find growth from volumes. Last year, they recorded a 20% growth in both the businesses and their aim is to continue to record the highest growth in the industry

36

The Paper Products Ltd.(PPL)

With consumer packaging sales revenue of Rs 3500 million in the year 2002, PPL is India's leading Consumer Packaging Company. Today PPL offers a wide portfolio of packaging solutions that include Flexible Packaging, Labelling Technologies and Specialised Cartons. And all this supported by the Packaging
Machine Division

to provide the customer

with Total packaging solutions. With three state of the art, fully integrated manufacturing facilities at Thane, Silvassa and Hyderabad; highly skilled and experienced staff, PPL is capable of working with the customer from product inception to the super market and with complete control and confidentiality. And this is reflected in the impressive client list that includes, Levers, Nestle, Cadbury, Britannia, Glaxo Smithkline, Coca Cola, Perfetti, Dabur, Marico, P&G In 1999, PPL became a member of the Huhtamaki Packaging Worldwide, a global leader in consumer packaging. Today PPL, is strategically located in six major Indian metros, and each of their five plants is technologically equipped to offer tailor made solutions from their very broad range of resources. PPLs addressable market is the upper end brands, who use premium packaging (Class A) and about half of the mid-end products of reputed companies (Class B). This segment is estimated to be growing at above 15% p.a. In the Class A market, their share is above 30%. Industry Outlook Indias consumer market is riding the crest of the countrys economic upswing, racing at an incredible pace. In the fast changing socioeconomic environment, the consumer is truly a moving target, on the radar of aggressive and ambitious retailers. Today the shopper is 37

faced with a plethora of choices in making a buying decision. This presents an enormous challenge to FMCGs to differentiate their products in the ever growing sea of products available in the market. The importance of packaging cannot be overemphasized. It is the high quality of packaging that protects the product through its distribution channel, ensuring that it reaches the retail shelf in pristine condition. It is also the first point of contact with the consumer with enormous play on visibility and the high quality talks volumes in terms of selling itself. Today more than ever before the challenge for FMCGs is to use the tools of branding and packaging, to attract the consumers attention. The Performance highlights of the company are: Chan ge 2006 2005 Rs. In Million 5795.7 4984.1 5012 4328.6 428.2 Items&but Flood 120.8 after 549 120.8 23.7 5.1 399.4 378.9 128.5 -29.7 3.4 276.7 45 -8 386.9 (%) 16 16 11

Gross Sales Net Sales Profit before Tax & Extraordinary Items Extraordinary

Insurance Claim Profit before Tax

Extraordinary Items Less: Provision for Tax Provision for Deferred tax Provision for Fringe Benefits Tax Profit after Tax

44

Net Sales increased by 16% to Rs. 5012 million surpassing the milestone of Rs. 500 crore while recording an increase of 11% in Profit before tax and extraordinary items. The operating Profit was Rs.431 Million and the Profit before Tax and extraordinary items was Rs. 428 38

Million. These represent an increase of 9.9% respectively over financial year 2005

and

10.7%

39

Financial Analysis Ratios Debt Equity Ratio Current Ratio Quick Ratio Gross Profit Ratio Net Profit Ratio Debtors turnover Ratio Average Collection Period Inventory Turnover Ratio Interest Coverage Ratio ROCE Working Capital Performance Ratio PPL focuses on ploughing back its profits into the business as can be seen from the reserves and surplus and is less dependent on External borrowings/ debt. As we can the debt servicing capacity of the company is increasing. Liquidity Position: The liquidity position of the company seems to be in a good position as can be seen from the current and quick ratio. Working Capital Performance Ratio refers to the sources through which debtors of a firm are financed. A ratio more than 2 indicates a better ability to meet ongoing and unexpected bill payments. Though the ratio is less than 2 the Working Capital Performance is on a rise. Turnover Ratio: the inventory turnover reflects the efficiency of inventory management. The higher the ratio the more efficient the management of inventories and vice versa. PPL was able to bring down inventories to Rs. 467 million as at 31st Dec 06 as compared to the previous year level of Rs. 529 million. However the lower debtors turnover ratio indicates a poor credit management. This receivable 40 2006 0.15
1.71

2005 0.08
1.86

1.22
8.60% 7.90% 5.81 62.93 10.74 70.51

1.26
9.06% 6.40% 5.58 65.41 8.18 55.65

22%
1.51

14%
1.36

period (60 days) needs to be judged against the average payable period (60 days) in case of PPL the two periods are exactly the same highlighting a very risky position. The interest Coverage ratio has been increasing indicating that the firm can meet its interest burden even if profit before interest and taxes suffer a considerable decline.
CREDITORS RATIO DEBTORS RATIO BILLS PAYABLE+SUNDRY/TOTAL CREDIT CREDIT 60.65822 44 59.70386 16 PURCH.*365 BILLS RECEIVABLE+SUNDRY/TOTAL SALES*365

Profitability: PPL is going through a phase where increasing raw material prices and restrain in production capacity (due to floods that affected the Thane Plant) has affected its margins as can be seen in its declining profit margins. Return on Capital employed measures how well the long term funds of owners and creditors are used. The higher the ratio the more efficient the utilization of capital employed and this seems to be the situation in Paper Products Ltd. Financing Bankers BNB PARIBUS Bank of Rajasthan Ltd Punjab and Sindh Bank Standard Chartered Bank HSBC Union Bank of India The company has not taken any long term borrowing from banks. The long term borrowings increased to Rs. 339 million on 31 st Dec 06 from Rs. 163 million on 31st Dec 05, purely due to increase in interest free sales tax deferred loan (under sales tax deferment scheme 41

availed in the State of Andhra Pradesh) and co-acceptance facilities on imported machinery availed by the company to part finance the North India Greenfield and other capital expenditure projects. The short term borrowings for working capital for the current year also were NIL, as in the previous year. The company has had cash flows of Rs. 877 million towards capital expenditure. And has plans for another Rs. 636 million in the next year. The projects are being financed by a mix of internal accruals and debt. Future prospects: The good pace of growth in the economy, combined with the fast rising aspirations of the consumer, has created an exciting growth opportunity for the latest technology based world class packaging. On the other hand the firm raw material prices, increasing pressure from consumers on packaging material prices, and amply available capacity with the several players is putting downward pressure on the margins. Paper Products Ltd. has a number of plans in place that needs successful implementation The North India Uttarkhand Greenfield plants second line to be fully operational in Q207. The new project for specialized packaging formats, backed by a technology transfer agreement with a European leader in the technology, is also scheduled for commercial production by end Q2 07 A new project for new products in the Hyderabad plant will also be on stream by the end Q3, 07. The reconstruction activity in the Thane plant will add in new improved capacities by 2008.

42

Active participation in t he global synergy projects with Huhtamaki Group, will open opportunities for PPL in India.

Needle Roller Bearing Company Ltd. NRB was established in 1965 as an Indo French Joint Venture with financial and technical collaboration from Nadella. Nadella belongs to Timken a World leader in Taper Roller Bearings. NRB was incorporated in Mumbai under the name NEEDLE ROLLER BEARING COMPANY LIMITED; the first Company to manufacture Needle Roller Bearings in India. The company is in ball and roller bearing business and is the only manufacturer in India making all the broad types of bearings, needle/ cylindrical/spherical/tapered/ thrust roller bearings. The annual production of the domestic organized sector is estimated at Rs. 2375 crores for the year. NRB, today, is India's most diversified and specialized bearing manufacturer, producing needle roller bearings, spherical roller bearings, cylindrical roller bearings, tapered roller bearings, ball bearings, crank pins and wide inner ring bearings. The wide product range has enabled NRB Bearings, to meet the bearing requirements of the Indian industry in virtually every sector, for every conceivable application - A one-stop shop for almost all bearing requirements. Industry Outlook The bearing industry in India is dominated by 12 organized players accounting around 55% of industry sales. SKF Bearing is the major player in the Indian bearing industry. Some other players are National Engineering Industries, FAG Bearings India, Timken India, TISCO and 43

many more. The market is also been flooded by many small players and imports into the country. Financial Performance The Performance highlights of the company are: 31.03.200 31.03.200 Change (%) 19 19 23 25 6 5 Rs. In Lakhs 29325.64 24635.63 25464.15 21455.91 5266.33 1567.43 221.36 76 3401.54 4291.02 1675 -113.19 0 2729.21

Gross Sales Net Sales Profit before Tax & Extraordinary Items Less: Provision for Tax Provision for Deferred tax Provision for Fringe Benefits Tax Profit after Tax

The company posted its highest ever sales revenue and profits during the year. Net Sales for the year ended 31 st March 2006, were Rs. 25464 lacs as against Rs. 21456 lacs in the previous year, an increase of 18.7 %. Profit before tax was at Rs. 5266 lacs as compared to the Rs. 4291 lacs in 2004-05, outperforming the previous years all time high PBT. After providing for current and deferred taxes, the Profit after tax was Rs. 3402 lacs setting a new record from the previous years high. Financial Ratios Ratios Debt Equity Ratio Current Ratio Quick Ratio Operating Profit margin Net profit Margin Debtors turnover ratio 44 2006 0.55 3.29 1.96 21% 13% 4.77 2005 0.25 2.5 1.59 20% 12.70% 4.4

Average Collection Period Inventory Turnover ratio Interest Coverage Ratio Return on Capital Employed(ROCE) Return on Total assets(ROTA) Working Capital Performance Ratio

76.52 4.34 22.39 16.54% 15.35% 1.78

82.95 4.33 37.56 19.53% 18% 1.61

Liquidity Position: A very good liquidity position as can be seen from the current and quick ratio. This shows the company is in position to meet its short term obligations. Working Capital Performance Ratio refers to the sources through which debtors of a firm are financed. A ratio more than 2 indicates a better ability to meet ongoing and unexpected bill payments. Though the ratio is less than 2 in case of NRB Bearings the Working Capital Performance ratio is on a rise. Profitability ratio: As mentioned by the management the Company has recorded the highest profitability this year though the return earned seems to lesser (as understood by the ROCE and ROTA) Turnover ratios: the low turnover ratios indicate a poor inventory and credit management. Too much inventory blocks up the capital. The debtors turnover needs to be judged against the Payable period. The company seems to be managing its trade creditors with the debtors by proper balancing of the time buckets.

CREDITORS RATIO DEBTORS RATIO

BILLS PAYABLE+SUNDRY/TOTAL CREDIT PURCH.*365 BILLS RECEIVABLE+SUNDRY/TOTAL CREDIT SALES*365 93 days 73 days

45

The debt- equity ratio is rising and NRB has a very low interest coverage ratio. Financing Bankers BNP Paribus Citibank N.A Canara Bank Sources Of Funds Shareholders Funds Share Capital Reserves and Surplus Loan Funds Secured Loans Unsecured Loans Deferred Liability(net) Total Secured Loans Tax As at 31.03.2006 (Rs. In Lacs) 969.23 12747.04 13716.27 4803.07 2715.43 7518.50 918.54 22153.31 As at 31.03.2006 358.20 4444.87 4803.07 Unsecured loans Commercial Paper Other loans and advances From SICOM Limited Interest Free Sales tax Loan Total 1500.00 As at 31.03.2005 (Rs. In Lacs) 969.23 10726.96 11696.19 181.67 2584.44 2766.11 697.18 15159.48 31.03.2005 31.67 150 181.67 1500.00

From Banks Cash credit Term Loan in foreign Currency Term Loan (repayable within one year )

1215.43 2715.43 7518.50 46

1084.44 2584.44 2766.11

Future Prospects Road and infrastructure development programs are expected to continue and by 2010-11 there will be improved connectivity to ports, cities and villages through a network of highways and interconnectivity to ports, cities and villages through a network of highways and interconnecting roads. This will give impetus to a vibrant auto industry which inturn offer sizeable market opportunities for domestic bearings industry. India has developed into a manufacturing hub for auto components manufacturers. NRB is well positioned to benefit as over the past few years it has focussed on implementing best- in class production systems, technology development, slashing cost while upgrading quality and scaling up its manufacturing facilities. However NRB faces threats from Global Competition, and spurious/ counterfeit supplies.

Caprihans India Ltd. Caprihans India Limited is one of the largest manufacturers of PVC Films in India and has got expertise of more than 35 years in this field. It manufacturers a wide variety of PVC films both Flexible & Rigid and also Sheets/Boards made from other polymers like ABS, PP, HDPE and Rigid PVC. The films are calendared while the sheets/Boards are extruded. Caprihans India Limited is a Public Limited company and became a part of EVC group in 1997. EVC was acquired by the INEOS group in

47

2001. Caprihans India Limited is today a part of the INEOS Films Group worldwide. The company has 4 calendaring lines, 3 extruder lines, 2 lamination and coating lines as also printing and embossing lines at its production units at Thane and Nasik, near Mumbai. The Company is engaged mainly in the processing of plastic polymers and manufactures Rigid and Flexible PVC films by Calendering process and certain plastic products through extrusion process. Rigid PVC film is largely used for packaging in the Pharmaceutical, Food and FMCG industries. Flexible PVC film and plastic extruded products are used for a variety of industrial and consumer applications.

Financial Performance The Performance highlights of the company are:

31.03.2 31.03.2 Change (%) 006 005 Rs. In Lakhs 13718.7 13889.1 Gross Sales Net Sales Profit before Extraordinary Items, interest and finance charges Add: Extraordinary Income/ (Expenses) Less: Interest and Finance Charges Less: Depreciation Profit before Tax Less: Provision for Current Tax Less: Provision for Deferred Tax Less: Provision for Fringe Benefit Tax Profit after Tax 5 11941.0 1 981.28 -6.3 0.36 266.14 708.48 125 108 15 460.48 8 12134.9 9 874.7 361.55 0.87 302.69 932.69 28.1 904.59

-1 -2 12

-24

-49

Sales for the year are Rs. 137 crores as compared to Rs. 139 crores during the previous year. Due to capacity constraints for the major products, the Company could not increase its volumes significantly. 48

Profit before tax and extraordinary items, was Rs. 715 lacs as compared to Rs. 571 lacs for the previous year. Due to steep rise in the crude oil prices, energy and transportation costs have risen significantly during the year. Profitability improved due to lower raw material cost through efficient purchasing and operational efficiencies. Financial Ratios Ratios Current Ratio Quick Ratio Operating Profit Margin Ratio Net Profit Margin Ratio Debtors turnover Ratio Average Collection Period Inventory Turnover Ratio Interest Coverage Ratio ROCE Working Capital Performance Ratio Liquidity Position: A good liquidity position as can be seen from the current and quick ratio. This shows the company is in position to meet its short term obligations. Working Capital Performance Ratio refers to the sources through which debtors of a firm are financed. A ratio more than 2 indicates a better ability to meet ongoing and unexpected bill payments. Caprihans has a favourable ratio which again reiterates the fact about its liquidity. Profitability ratio: As mentioned by the management the Company has recorded the highest profitability this year though the return earned seems to lesser. Turnover ratios: the low turnover ratios indicate a poor inventory and credit management. Too much inventory blocks up the capital. 49 2005-06 3.81 2.79 5.90% 3.86% 3.3 110.61 5.05 1986.5 5.34%/5.41% 1.97 2004-05 4.37 3.20 4.71% 7.45% 3.15 115.87 5.74 657.49 11.16%/6.7% 2.61

The debtors turnover needs to be judged against the Payable period. Liberal credit Policy has led to very low debtor turnover ratio however the company does not seem to be in the position to seek such liberal terms from its creditors as a result of which their seems to be a working capital requirement.
CREDITORS RATIO DEBTORS RATIO BILLS PAYABLE+SUNDRY/TOTAL CREDIT PURCH.*365 BILLS RECEIVABLE+SUNDRY/TOTAL CREDIT SALES*365

73.42169 114.3063

Financing Bankers Bank of Maharashtra State Bank of India HSBC Bank Ltd. The company has neither availed any loan from Financial Institutions / Bank nor raised any debentures. Bank of Maharashtra has sanctioned working capital facilities which are secured by hypothecation of stocks and book debts and by a second charge by way of an equitable mortgage by deposit of title deeds over the immovable properties of the Company: Future Prospects With continuing growth in demand for the products, there are opportunities to increase sales by enhancing capacity. The Company has initiated steps to increase its Rigid Film capacity by installing an additional Calender. Capacity for PVDC coated PVC films is also being enhanced. Both these projects are expected to be completed during the year 2007.

50

Additional capacity will also give an opportunity to increase exports and thereby reduce the dependence on the domestic market which presently accounts for nearly 90% of sales.

However, the Companys main raw material viz. PVC resin is subject to high price volatility in the international and domestic markets. For certain grades of resin, there is only one manufacturer in India. Hence any disruption of the suppliers plant operations can have an adverse effect on the availability of resin.

As mentioned above, fierce competition in the market for the companys products affects the companys ability to raise prices to compensate for the increase in the input costs.

Glaxo Smithline Ltd. GlaxoSmithKline is a leading, global, research-based healthcare and pharmaceutical company. In India, it is the Number One Pharmaceutical Company with a market share of 6.45 per cent. GSK commands the number one position in most of the therapeutic categories in which it operates. Other than pharmaceuticals, GSK has one business - Qualigens Fine Chemicals (QFC). The Companys Agrivet Farm Care (AFC) business was sold to Virbac India Private Limited in 2006. QFC has an estimated market share of 29 per cent in the laboratory chemicals market. It also has a significant presence in the Diagnostics business. GSK has two manufacturing units in India, located at Nashik and Thane. The 2000-strong field force of GSK, backed by a nation wide network of over 4000 stockists, ensures that the Companys products are 51

readily available across the nation. This combined with the quality of the products means that GSK is able to strengthen the hands of doctors by offering superior treatment and healthcare solutions. Industry Outlook Glaxo Smithline Ltd. commands a 6.4% market share in the Indian Pharmaceuticals Market (Source: Stockist Audit [ORG IMS] IIPA MAT December 2006 - this audit is representative of the Companys customer base covering stockists, sale to hospitals and vaccines purchases). The Company enjoys a leadership position in the Hospital segment (Source: [ORG IMS] Hospital Audit MAT December 2006) and in segments in which its products are represented. Financial Performance 31/12/2 31/12/2 Change( 006 005 %) Rs. In Lakhs 167756. 157588. 6 9 6 148530. 155292 2 5 47790.8 55595.4 5 16 19423.0 4 17162.4 36172.3 30628.4 6 5 18 18378.9 19579.8 7 5 54551.3 3 50208.3 9

Gross Sales Net Sales Profit before taxation and Exceptional Items Less: Provision for Taxation Profit after taxation and Before Exceptional Items Exceptional Items Net Profit After Tax

The Company divested the Agrivet Farm Care (AFC) Business as a going concern to Virbac Animal Health India Private Limited, a 100% subsidiary of Virbac S. A. France, on 31st July 2006 for a consideration of Rs.207.10 crores. The financial results for the year under review are 52

therefore not comparable. After excluding the AFC Business, the financial results for 2005 and 2006 of the continuing businesses of the Company are as follows: 31/12/2 31/12/2 006 005 Rs. In Lakhs 149006. 136389. 6 8 45379.1 54735.4 3 Chang e (%) 9 21

Net Sales Profit before Taxation and Exceptional Items

The Company had a satisfactory year, with Net Sales of the Companys continuing businesses (excluding the AFC Business) registering a growth of 9.3%. Profit before Tax and Exceptional Items of the Companys continuing businesses (excluding the AFC Business) grew by 20.6%. A double-digit growth in the priority products range, procurement and manufacturing efficiencies and tight expense control helped improve profits. Higher income from treasury operations and clinical research operations also contributed to the profit improvement. Cash generation from operations continued to be favorable during the year, driven by the strong business performance. Cash surpluses were deployed in safe instruments.

Financial Ratios Ratios Current Ratio Quick Ratio Operating Profit Margin Ratio Net Profit Margin Ratio Debtors turnover Ratio Average Collection Period Inventory Turnover Ratio 31/12/2006 0.9 0.47 37% 35% 25.69 14.20 6.44 53 31/12/2005 0.84 0.44 33% 34% 22.04 16.56 6.8

Interest Coverage Ratio ROCE Working Capital Performance Ratio

874.45 15% 0.26

287.20 47% 0.28

Liquidity Position: A very poor liquidity position as can be seen from the current and quick ratio. This shows the company is not in a position to meet its short term obligations. Working Capital Performance Ratio refers to the sources through which debtors of a firm are financed. A ratio more than 2 indicates a better ability to meet ongoing and unexpected bill payments. Glaxo Ltd has a very low Working Capital Performance Ratio. Profitability ratio: the company is in a good profitability position which is on a rise; however the Return on Capital employed shows a decline. Return on Capital employed measures how well the long term funds of owners and creditors are used. The lower the ratio the less efficient the utilization of capital employed. Turnover ratios: the company has a very good Debtors turnover ratio which indicates a very short term of credit lending. This policy on one hand seems to be good as it reduces the trade cycle but can also led to poor sales on the other hand. CREDITORS RATIO DEBTORS RATIO BILLS PAYABLE+SUNDRY/TOTAL CREDIT PURCH.*365 BILLS RECEIVABLE+SUNDRY/TOTAL CREDIT SALES*365 244.0064 15.02292

As can be seen they enjoy a very liberal credit terms from their creditors, which though is a non-interest bearing current liability, a reduction in the average payment period is likely to enhance the image of the company from its suppliers point of view. 54

Financing Bankers Citibank N.A HDFC Bank Ltd Hongkong and Shanghai Banking Corporation Limited Standard Chartered Bank State Bank of India. The company has not raised any loans (term or working capital) during the year. The only debt to its name is the Unsecured loan (Interest Free Sales Tax Loan from SICOM ltd.) to the extent of Rs. 553.71 Lakhs.

Future Prospect India's US$ 3.1 billion pharmaceutical industry is growing at the rate of 14 percent per year. It is one of the largest and most advanced among the developing countries. Indian pharmaceutical is making a mark on the global scene. The Indian pharmaceutical industry is also getting increasingly U.S. FDA compliant to harness the growth opportunities in areas of contract manufacturing and research. Glaxo Ltd. is in talks with some leading Japanese and American companies for new products in therapeutic areas like serious infections, cardiovascular and trauma care. After making a major entry in diabetes with the introduction of Windia and Windamet, the Company is also developing four new products in the Windia family. Plans are in hand to introduce new products in therapeutic areas like anti- like anti- inflammatory/analgesic, oral antibiotics, cardiovascular and anti-coagulants in 2007.

55

 CEAT Tyres Limited The oldest company of the RPG Enterprises, CEAT Tyres was established in 1958. Today, they are one of Indias leading tyre manufacturers, with an annual turnover of Rs 1,952 crores (US $434 million). Their solid brand equity has empowered them to establish a strong presence in both, domestic and international markets. Their tyres, tubes and flaps are renowned for their superior quality and durability, and are recognised as being born tough. They offer the widest range of tyres to all user segments, and manufacture world-class radials for all Indian vehicles including: Heavy-duty Trucks and Buses, Light Commercial Vehicles, Earthmovers, Forklifts, Tractors, Trailers, Cars, Motorcycles and Scooters, Auto-rickshaws. Industry Outlook A double digit growth in automobile sales and improved economic activity has helped the Indian tyre industry register a healthy revenue growth during the year under review. However, the management of input costs was a very challenging task due to unprecedented increase in prices of natural rubber and petroleum based raw materials. Natural rubber prices touched record levels whereas crude oil continued to remain high thereby leading to higher prices of carbon black and nylon, key ingredients for tyre business. A significant part of the rise in costs had to be absorbed within operating margins due to the highly competitive market scenario, leading to an increased pressure on overall profitability. Financial Performance
Change(%) 31/03/2006 31/03/2005 Rs. In Crores 1951.99 1780.3

Gross Sales

10

56

Net Sales Profit before taxation and Exceptional Items Less: Provision for Taxation Net Profit After Tax

1747.42 5.22 4.7 0.52

1527.99 -2.87 1 -1.87

14 282 128

CEATs sales performance was generally in line with that of the industry. The Company registered a revenue growth of 14 % during the year under review. The key driver of this growth was exports, which registered a healthy growth of 52 %. CEAT sustained its focus on market development, particularly new markets in Europe and Australia and a commitment to total quality management across the organization has improved operating cost efficiencies. Consequently, operating profit of the company increased from Rs. 78.52 crore in the previous year to Rs.91.22 crore in the year under review, despite the steep rise in input costs. Financial Ratios Ratios Debt Equity Ratio Current Ratio Quick ratio Operating Profit margin Net Profit Ratio Debtors turnover ratio Average Collection Period Inventory Turnover ratio Interest Coverage Ratio Return on Capital Employed Working Capital Performance Ratio 2006 1.2 0.88 0.58 2.62 % 0.02% 6.9 52.89 9.53 28.77 0.07% 0.96 2005 0.72 1.6 1.32 3.97% (0.12%) 6.46 56.5 9.08 25.53 (1.00%) 0.82

Liquidity Position: A very poor liquidity position as can be seen from the current and quick ratio. This shows the company is not in a position to meet its short term obligations. Working Capital Performance Ratio refers to the sources through which debtors of a 57

firm are financed. A ratio more than 2 indicates a better ability to meet ongoing and unexpected bill payments. CEAT Ltd has a very low Working Capital Performance Ratio. Profitability ratio: the company is not in a good profitability position, although it has recovered from the loss of the last years. The Return on Capital employed is also very low. Return on Capital employed measures how well the long term funds of owners and creditors are used. The lower the ratio the less efficient the utilization of capital employed. Turnover ratios: The turnover ratios indicate the inventory and credit management. Too much inventory blocks up the capital. The debtors turnover needs to be judged against the Payable period. Liberal credit Policy aids in increasing the sales and CEAT manages to balance the receivable and payable period.

CREDITORS RATIO DEBTORS RATIO

BILLS PAYABLE+SUNDRY/TOTAL CREDIT PURCH.*365 BILLS RECEIVABLE+SUNDRY/TOTAL CREDIT SALES*365

81 days 51 days

Financing Bankers Bank of India Bank of Baroda Indian Bank State Bank of India UCO Bank Vijaya Bank Corporation Bank State Bank of Travancore The Dhanalakshmi Bank Ltd. ICICI Bank Limited The Karnataka Bank Ltd. The United Western Bank Ltd. 58

Export-Import Bank of India SOURCES OF FUNDS SHAREHOLDERS FUNDS Share Capital Reserves and Surplus 45,67.99 303,32.44 349,00.43 LOAN FUNDS Secured Loans Unsecured Loans 291,22.27 126,41.88 417,64.15 1.20 2005-06 (Rs in lakhs) 2,14.28 35,09.81 595,03.97 630,13.78 338,85.34 111,78.32 450,63.66 0.72(on a rise) 2004-05 (Rs in lakhs) 357.20 2005-06 (Rs in lakhs) 2004-05 (Rs in lakhs)

Debt Equity Ratio SECURED LOANS Debentures:13.50 % Secured Redeemable NonConvertible Debentures issued to ICICI BANK Loans from Financial Institutions \ Banks : IFCI Limited (Note 2) ICICI Bank Limited (Note 2) IDBI Limited (Note 2 & 3) The Federal Bank Limited (Note 2) Indian Bank (Note 4) Working Capital Term Loan (Note 5) Bank Borrowings : (Note 6) Working Capital Demand Loan

2,14.30 10,00.00 22,16.00 5,62.32 54,78.95 33,17.11

6,42.90 18,00.00 20,32.00 8,12.42 68,83.00 -

5,20.41

17,02.33

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FCNR - B Loan Cash Credit Facilities Export Packing Credit Vehicle loan (Note 7) Interest accrued and due Unsecured Loans Term Loan IL & FS Limited Banks Public deposits Inter-corporate Deposits Commercial Paper Interest Free Sales tax Loan Defered Sales Tax Loan State Industrial and Investment Corporation of Maharashtra Ltd (SICOM)

--22,51.20 131,74.93 1,72.77 291,22.27

33,16.58 55,56.43 106,77.21 1,00.56 4.71 338,85.34

3,50.00 27,59.49 60,06.03 9,88.00 2,78.51 22,59.85

3,50.00 5,00.00 69,72.87 6,26.31 5,00.00 4,06.66 18,22.48

126,41.88 Future Prospects

111,78.32

Tyre industry is expected to maintain its robust growth buoyed by the increase in demand for automobiles and encouraging growth in key sectors of the Indian economy. The Central Governments continued thrust on road and infrastructure projects will give a much anticipated boost to the overall movement of goods and vehicles across the important trading and consumer destinations of the country leading to an increase in demand for tyres. The recent legislation 60

imposing load restrictions and safety standards has also led to an improved discipline in usage and replacement of tyres and also strengthened demand in the domestic market. CEAT has ensured a balanced product portfolio in order to tap the opportunities presented by these developments. CEATs business plan for financial year 200607 takes into account a focus on greater value addition to its product portfolio and expansion of its car radial capacity, which together should reflect in improved margins in the coming year.

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OTHER INSTRUMENTS AVAILABLE FOR THE CORPORATES

Long Term Sources of Finance 1) Equity: Equity Capital represents ownership capital, as equity shareholders collectively own the company. They enjoy the rewards and bear the risks of ownership. However their liability, unlike the liability of the owner in a proprietary firm and the partners in a partnership concern is limited to their capital contribution. It offers permanent capital to the issuing company with out any fixed obligation to pay dividend to Share holders 2) Preference Capital: Preference Capital represents a hybrid form of financing- it partakes some characteristics of equity and some attributes of debentures. It resembles equity in the following ways; (i) preference dividend is payable only out distributable profits; (ii) preference dividend is not obligatory payment (the payment of preference dividend is entirely within the discretion of directors); and (iii) preference dividend is not tax- deductible payment. Preference Capital is similar to debentures in several ways, i) the dividend rate of preference capital is fixed; (ii) preference capital is redeemable in nature; and (iii) preference shareholders do not normally enjoy the right to vote. 3) Internal accruals: Capital Reserve, revaluation reserve, Share premium Account, Retained Earnings (carried from the Profit and Loss A/c)

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4) Debentures: A Debenture is a marketable legal contract whereby the company undertakes to pay its owner a specified rate of interest for a defined period and to repay the principal on the maturity date. Debenture holders are the creditors of company. The obligation of a company toward its debenture holders is similar to that of a borrower who promises to pay interest and principal at specified times. Debentures often provide more flexibility than term loans as they offer greater variety of choices with respect to maturity, interest rate, security, repayment and special features. 5) Long term borrowings/ Loans: Historically, term loans given by financial institutions and banks have been the primary source of longterm debt for private firms and most public firms. Term loans also referred to as term finance; represent a source of debt finance which is generally repayable in les than 10 years. Features of term loans Currency: financial institutions (and banks) give rupee loans as well as foreign currency term loans. Rupee term loans are given directly to industrial concerns for setting up new projects as well as for expansion, modernization and renovation projects. These funds are provided for incurring expenditure for land, building, plant and machinery, technical know-how, miscellaneous fixed assets, preliminary expenses, preoperative expenses, and margin money for working capital. Financial institutions provide foreign currency term loans for meeting the foreign currency expenditure towards import of plant, machinery and equipment, and payment of foreign technical know how fees. Short Term 1) Working Capital Demand Loan: To avoid the drawbacks of CC (mainly with the uncertainty for the bank about cash inflows/ outflows 63

and the interest income) RBI had in April, 1995 introduced the loan system of delivery of credit for borrowers with working capital (fund based) limit of Rs. 10 crore. Since it is a short term loan, which has a maturity period of 15 days, it is known as Working Capital Demand Loan (WCDL). The WCDL can be rolled over. There is an annual renewal of working capital facilities. In order to ensure that there will be need based credit facility, the disbursement of WCDL is made based on the projected cash budget statements and the Quarterly Information System (QIS/ QOS).

2) Inter- Corporate Deposits: Inter-Corporate Deposit (ICDs) is essentially a short term assistance provided by one corporate with surplus funds to another in need of funds. ICDs are usually unsecured lending but, at times, may be structured as collateralized lending for weaker companies to get the benefit of credit enhancement. The main disadvantage to the lender is that the money is locked in for the specified period. Types Normally, ICDs are placed at a fixed rate for a fixed tenure. However, ICDs may also have the following structures:

Fixed rate ICD with a put/call option Floating rate ICD with a Put/Call option, wherein the rates are linked to a benchmark such as MIBOR.

Issuer Corporates having short term funds lend to corporates in need of funds.

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Rating ICD is a non-public instrument. Hence, it is not rated. Coupon terms The interest rate is normally fixed and payable on maturity. The range of interest varies, depending upon the quantum, tenor, and the credit rating of the borrower. Day count convention for interest payments Interest to be calculated on an actual/365-day year basis. Maturity Typical maturity period for ICDs varies from 90 days to 180 days. Market Participants The major participants are cash rich corporates, Public Sector Undertakings, Non Banking Finance Companies and Financial Institutions. The market is between participants who are known to each other. Brokers play an important role in procuring/placing of funds. Minimum denomination and transaction size There is no fixed denomination or transaction size. However, the overall amount to be placed is guided by section 372 of the Companies Act, 1956.

Risks

Credit risk: this being a major risk, it is preferable to invest with a highly rated corporate which is known to the investor.

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Liquidity risk (in some maturity segments) since only the surplus amounts during a particular period are lent, liquidity risk is minimal. However in the event of a default by the corporate, it can lead t a considerable loss..

Operational

risk:

Since

the

transaction

is

prearranged,

operational risk is minimal 3) Commercial Paper: CP is an unsecured money market instrument issued in the form of a promissory note and transferable by endorsement and delivery. Commercial Paper was introduced in India in 1990 with a view to enabling highly rated corporate borrowers to diversify their sources of short-term borrowings as also to provide an additional instrument to investors. Issue of CP is governed by the Non-banking Companies (Acceptance of deposits through Commercial Paper) Directions 1989. It has been brought within the overall purview of the Directions issued by the Reserve Bank of India under Section 45K of the RBI Act, 1934. Under these Directions, CP can be issued only for raising working capital finance. The aggregate amount to be raised by issuance of CP cannot exceed the working capital (fundbased) limit sanctioned by bank/s to an issuer company and to the extent of CP issued; a corresponding reduction has to be made in the working capital limit. The maturity period of commercial paper usually ranges from 90 days to 360 days. Commercial paper is sold at a discount from its face value and redeemed at its face value. Hence the implicit interest rate is a function of the size of the discount and the period of maturity. Commercial paper is either directly placed with investors who intend holding it till its maturity. Hence there is no well developed secondary market for commercial paper.

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There are certain regulations stipulated by the RBI to ensure that only financially strong companies can issue commercial paper. The company has a net worth of at least Rs. 50 million Its sanctioned fund based limit for bank finance is at least Rs. 100 million The face value of commercial paper issued by it does not exceed its working capital limit Its equity is listed on a stock exchange Its commercial paper receives a minimum rating of P1 from CRISIL, A-2 from ICRA, etc. It has a minimum current ratio of 1.33 It enjoys health code No. 1 status The minimum size of each commercial paper issue is Rs. 2.5 million and the denomination of each commercial paper note is half a million rupees minimum. 4) Public deposits: Many firms, large and small have solicited deposits from the public in recent years, mainly to finance their working capital requirements. Companies typically offer an interest rate of 8-9 per cent for one year deposits, 9-10 per cent for two year deposits and 10-11 per cent for three year deposits. Regulation: The companies (Acceptance of deposits) amendment Rules 1978 governs fixed deposits. The important features of this regulation are: PDs cannot exceed 25 per cent of share capital and free reserves. The maximum maturity period allowed for public deposits is 3 years and the minimum is 6 months. A company inviting deposits from public is required to disclose certain facts about its financial performance and position. 67

SICOM LTD Since its inception in 1966, SICOM has dedicated itself to

providing entrepreneurs with a range of fund-based and non fundbased products and services. For more than 3 decades SICOM has been responsible for catalyzing the development of infrastructure and industry in the State of Maharashtra. After 1994 SICOM has been offering its services for projects located anywhere in India. SICOM has 5 regional offices at Delhi, Nagpur, Pune , Aurangabad and Nashik. SICOMs belief in continuously upgrading it's products and providing a wide range of financial and advisory services to Indian and international investors is reflected in its vision. SICOM provides the following services. Finances service oriented projects like software development, hospitals, hotels, etc. provides promoter funding finances a project anywhere in India funds infrastructure projects participates in consortium finance provides loan against shares

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THE ROAD AHEAD

The last six years of financial reforms have changed all this beyond recognition. Corporate finance managers today have to choose from an array of complex financial instruments; they can now price them more or less freely; and they have access (albeit limited) to global capital markets.

Corporates are slowly making changes in their relationships with bankers. From a scenario where they borrowed from several banks banded into consortiums, they are now reducing the numbers-both for convenience and business reasons, giving oldstyle consortium banking a hard knock. A big change has come through, and that is, consortiums are no more moribund or restrictive. A corporate can enjoy flexibility without disbanding it". Today Corporates are becoming more demanding. They enjoy the powers of wanting well priced loans and services resulting in banks going into overdrive wooing the company.

Several factors have led to the increasing attractiveness of offshore borrowings. Some attribute it to the lack of depth in the local money markets. Local per client exposure norms also creates demand for offshore route. The rupee borrowing cost is still higher. Even with the cost of hedging, borrowing from the overseas markets works out cheaper. It is difficult for top corporates today to borrow at below 10 per cent from the domestic market. 69

The amounts that can be raised are huge. Also, the recent and hikes in the cash reserve ratio (CRR) by the Reserve Bank of India (RBI) has altered the local interest rate scenario significantly. More so, as it comes on the heels of slack deposit growth at 20 per cent and burgeoning credit off take topping 30 per cent and a tad more.

With a growing economy and many problem loans behind them, bankers are aggressively marketing loans to small and medium sized business.

Commercial banks are faced with competition similar to that of full- line retailers. Just the way superstores by offering office supplies, building materials, books, pet supplies, and sporting goods under one roof have captured a significant market share at the expense of the conventional retailers; the money market funds, mutual fund families, specialty credit card companies, and a variety of asset based lenders are invading into the territory of commercial banks at the latters expense. In addition to the competitive marketing techniques, operating efficiencies. They also face fewer regulatory and geographic constraints compared to commercial banks that offer the same services. Commercial banks in response to this challenge are offering a
Areas for in Corporate Banking wide range ofSuccess fee- based services.
8%

Global Geographic Reach

Integrated cash management delivery Study shows that success in Corporate Banking revolves around
12%

delivery-14% internet based and electronic Internetbased based channels as 26%

Ability to provide a full range of products and services Electronic distribution (non- intenet)

compliments to the traditional channels distribution to allow access to

18% 22%

70

multiple services through the same point of contact. The banks that do not provide a complete range of product and services will be at a disadvantage. As corporations operate on multiple time zones the need for 24*7 delivery and access also intensifies. The areas for success in corporate banking are highlighted in the following figure.

Bank of India's Executive Director S. Gopalakrishnan observes, "There is a polarized situation today.at one end of the spectrum are the multinationals and bigger local companies. Every bank wants to do business with them, but the rest of the lot, are perennially on the lookout for funds. And these are the ones BoI targets as it believes Good Ideas Come in Small Packages.

Vendor financing/ Channel financing takes care of supply chain management, but one crucial link missing there is the transporters. Thane has a number of manufacturing units sourcing/ selling their materials all over India. Bank of India 71

could come up with a product designed to finance the truck operators who are dedicated in servicing to a company. The truck operators are typically small players and hence have limited sources for raising funds. It is likely that the vehicles used by them have been financed at a high cost which they would indirectly be passed on to the company in the form of increased freight rates. A financing facility could be set up for the truck operators, which could be used for refinancing their existing vehicles or could be used for expansion of their fleet in line with the company's growth requirements. BoI can provide a line of credit for funding the truck operators. The company could recommend truck operators for financing under this facility after satisfying itself of the satisfactory performance of the operator in the past. BoI could perform its own evaluation of the truck operator based on the recommendation.

The use IT as a strategic business tool for competitive advantage to achieve superior standards of customer service in a cost-effective manner would certainly help to stand out in the clutter.

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REFERENCES

Text Books 1) Commercial Banking- ICFAI University 2) Principles of Banking- Indian Institute of Banking and Finance 3) Bank Financial Management- Indian Institute of Banking and Finance 4) Financial Management- Prasanna Chandra Journal/ Articles 5) Report on Capital Market Development, Corporate financing Pattern and Economic Growth in India. By R. N Agarwal Website 6) www.icicidirect.com 7) www.rbi.org.in 8) www.bankofindia.org 9) www.banknetindia.com 10) 11) 12) 13) 14) 15) www.caprihansindia.com www.nrbbearings.com www.pplpack.com www.iciindia.com www.financeindia.org www.gsk-india.com

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