M/S Kumar Bros. Chemists Pvt. Ltd.

BO: Sec-22 B Chandigarh

CREDIT & REHABILITATION DEPTT.

CIRCLE OFFICE: SEC.17B, CHANDIGARH
Ph. 0172-2703075, 2706822
Date: 24-09-2014
Name of the Division:

Item No.:

Meeting Type: FGMCAC, Chandigarh.

Meeting Date:
Purpose: For Approval

Gist of the Proposal: The proposal falls under the powers of FGMCAC due to
enhancement of existing FBWC from Rs.27.00 crores to Rs 32.00 crores & NFB Rs. 0.50
Crores, Total Rs. 32.50 Crores in favour of M/s Kumar Brothers Chemists Pvt. Ltd.
1 Proposal Tracking No. / Date:

3248002014000080; Date:11.09.2014

2 CRR ABS (Mid corporate

Model) under internal rating
model signifying risk
3 External Rating
4 Activity
5 Group
6 Banking
7 Lead Bank ( if applicable)
8 PNB Share (if applicable)
9. Project Loan( if applicable)
Total cost of project:
Total Debt:
Our share:

B-1 (Score 54.72) ABS 31.03.14 signifying

Modest Safety
BB as per CARE Rating valid up to 11.09.2014
Retail & Wholesale trading of medicines
Kumar Group
Sole Banking
NA
100%
NA
NA
NA
NA

Name of the Account and BO/Controlling Office/FGMO: M/s Kumar Bros. Chemists Pvt Ltd.
BO: Sector-22-B, Chandigarh. CO: Chandigarh
EXECUTIVE SUMMARY

1) Borrower/Group/ Main Promoter/Since when dealing with PNB

M/s Kumar Bros. Chemists Pvt. Ltd.
- Main Promoters are Mr. Ashwani Kumar Singla and Mr. Parmod Kumar Singla
- Dealing with PNB since May 2010
2) Year of Establishment/ Location of Regd/Corporate Office/Plants.
- 12.05.1998 vide certificate of incorporation no. 53-21377 of 1998 issued by
office of the Registrar of Companies Jalandhar. Earlier, it was a partnership
concern since 19.09.80.
- SCO 7-8, Sector 11 D, Chandigarh which is owned by director/guarantors of
the company.
3) Risk Rating/ External Risk Rating.
Page 1 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

-

The internal risk rating of the company is B-1 with score 54.72 based on ABS
31.03.14 indicating Modest safety under Mid Corporate borrower rating model
and LB1 under facility rating model indicating moderate safety.
The external risk rating of the company is BB as per CARE report as per ABS
dt: 31.03.2013. The ERR is valid up to 11.09.14

4) Activity with Capacity, if any/Total Credit limits with Consortium/ No of

Bankers for WC/TL /Lead Bank /PNB Branch/CO and Limits.
- The company comprises of itself in 3 divisions i.e. Whole sale/retail trade of
medicines & surgical, cosmetics. The company is a leading chemist of the
entire region and supplier of medicines/surgical items to govt. and armed
forces hospitals in addition to local hospital and nursing home in Chandigarh,
Panchkula, Mohali and all other nearby areas. The Company is also leading
supplier of products used for cardiac surgery items i.e. stunts, heart valves,
balloons angiography, angioplasty equipments and high value injectables
particularly for cancer treatment.
- Sole banking with PNB and is enjoying CC (H) facility of Rs. 27.00 Crore and
NFB limit of Rs. 0.50 Crore.
5) Conduct of the Account ie Satisfactory Operations/ Servicing /Utilisation
levels of FB, NFB, sub limits/ irregularities, if any/ compliance of sanction
terms.
- Satisfactory conduct of Account, all Terms & Conditions of previous sanction
have been compiled with.
6) Turn Over/Export/Import Turn Over/TNW/Total Debt/Maintenance of Financial
Ratios.
-

The sale of the company is on the increasing side and is Rs 74.91 Crores as
per ABS as at 31.03.14 as compared to 63.72 Crores as per ABS 31.03.13.
TNW as on 31.03.2013 & 31.03.2014 being Rs.6.27 Crores and Rs.7.44
Crores respectively.
All other financial ratios & parameters being satisfactory.

7) Market/ Latest Web Report, if any, in brief. Satisfactory

8) Material adverse Report from Credit Bureaus, if any. Nil
9) Proposal in brief.
10)

Enhancement of FBWC limit from Rs 27 Crores to Rs 32 Crores.

Source/Timing of Promoter Contribution, with justification. NA

11) Status of physical progress/ Financial Tie up/ Sanction by other banks: NA
12) TEV Report Conclusion : NA
13) Status of other projects/ Adverse performance of group concerns, if any, in
brief.
- Kumar Group / Conduct of allied concerns is satisfactory.
14) Primary Security

in value for Consortium/PNB and percentage of coverage

Page 2 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

(wherever possible).
- Sole banking with us and100% coverage.
15) Collateral Security in value for consortium/PNB and percentage of coverage.
Efforts taken for improving coverage, wherever applicable, in brief.
- To the extent of Rs.27.55 Crores, against proposed exposure of Rs.33.16
crores including enhanced portion of FBWC limits of Rs 5 crore & 3 car loan
accounts sanctioned under BM power.
We recommend for considering enhancement of proposed facilities for sanction against
collateral cover of 84.76%.

16) Justification for lower pricing, if suggested. No concession is allowed.

17) ECGC /other Credit Insurance, if any and its coverage: N.A.
18) Usance period for Domestic/Import LCs/Buyers Credit etc: N.A.
19) Deviations from the Policy, if any: Nil
20) Extent of Unhedged exposure/Time gaps in natural hedges/ remedial
measures suggested: N.A.
21) Any other material facts: Nil
22) NGB approval date, with deviation if any. NA
23) Recommendation of the Circle Head: Recommended for enhancement of FBWC
limits from Rs 27.00 Crores to Rs 32.00 Crores but restricted to Rs. 30.00 Crores
up to 31.03.15.

Page 3 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

Name of the Account and BO/Controlling Office/FGMO: M/s Kumar Bros. Chemists Pvt Ltd.
BO: Sector-22-B, Chandigarh. CO: Chandigarh
(Rs. in Crore )
Subject: To consider
A. Sanction of Working Capital Limits
Existing
27.00
0.50
0.00
27.50

FB
NFB
Other
Total
B. (i) For Fresh Term Loan:

Proposed
32.00
0.50
0.00
32.50

NA

(ii) For Review of Term Loan (Limit Rs.-) with present O/S Rs. NA
C. Approval of ROI/ Service charges as under:(Rs in lac)
Facility Existing
Proposed
Applicable
rate
In terms of LA Cir No. 48/2014 as
applicable to IRR as B-1 and ERR
as BB
CC
BR+2.25 BR+2.75% - BR+2.75%
Rate of
(1.00%
%
i.e.13.00%
interest
i.e.12.50% Relaxation)
=12.00%
Processing
OD
NA
NA
NA
fee
BG
As per LA As per LA As per LA
Comm. on
Cir 39/14 Cir 39/14
Cir 39/14
NFB
CC
Other
charges, if
any

NA

Rs 400/per lacs
Max

Income Earned
Last year
Current year
31.03. 14
upto_31.08.14
Intt. Non-intt Intt.
Non-intt
328.45 NA
146.79 NA

-NA
NA

Rs 400/- per NA
lacs Max
Rs.25000/-

NA

NA

NA

0.02

NA

0.02

NA

NA

NA

Rs. 25000/-

D. Approval of other Issues, if any :

-

For sanction enhancement of proposed facilities against collateral cover of 85%.

Relaxation in ROI of 1.00% from card rate.

PART I
Enhancement of FBWC limits from Rs 27.00 Cr to 32.00 Cr
Whether fresh/
renewal/
enhancement
Asset Classification Standard, PMS rank 2
as on 31.08.2014
and last PMS score
dated 30.06.2014
Rating Date of Score
ABS Valid Up to Reasons
Credit Risk Rating

Page 4 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

by Bank

Rating

Present

B-1

30.07.1
4

54.7
2

31.03.1
4

Previou
s

A4

21.10.1
3

58.2
9

31.03.1
3

Present

LB1

Facility Rating

for
degradatio
n
30.09.15 *
30.09.14

01.08.1
31.03.1
30.09.15 NA
4
4
Previou
LA4
21.10.1
31.03.1
30.09.14 NA
3
3
s
*Decrease in subjective marks in management evaluation and
business industry evaluation.

Rating from External

Agency (The external
rating should be
mapped to the
internal rating)
Whether priority/non
priority sector as per
PS&LB
guidelines
(Latest
being
PS&LB
/LBC/
Codified
Circular
No.24
dated
02.07.2014)
Sub-sector may also
be mentioned.
Whether Agriculture/
Retail/ SME/Others
(Please specify)
a) Whether Sensitive
Sector
Real
Estate/ Capital
Market
b) Applicable Risk
weight
Consortium/Multiple
Banking
Lead Bank
PNBs Share %
Date of application
Date of receipt of
proposal -At BO
At CO:
Date of ack. given to
the party

Facility
rated

Rating

Date of
rating

Rating
Agency

Remarks

CC

BB

12.09.13

CARE

long Term
Short Term

NFB
A4
Mapped as B with our internal rating as per ABS 31.03.2014

Non Priority Sector

MSME( Trading)

NO

100%
NA
NA
Sole bankers
10.09.2014
10.09.2014
17.09.2014
---Page 5 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

Date of clarifications,
if any, received at
CO
Date of submission of
proposal
Date of the original
sanction
Date of last sanction
& authority/In
Principle Consent
Authority/In Principle
Consent/NBG
clearance sale with
date
Remarks
Customer ID No.
Activity code (as per
ladder)
2.
a.

NA
17.009.2014
05.05.2010
08.11.2013, FGMCAC, Chandigarh.

NA

NIL
EUX001987
4094

Borrowers Profile
Group Name

Kumar Group

b.

Address of Regd./Corporate Office (with e-mail

ID)

SCO 7-8 ,Sector 11 D, Chandigarh, in

the name of one of Director and other
family members and mortgage with
Religare Finvest Ltd against LAP loan of
Rs.8.30 crores.BM has confirmed that
Rent deed of 5 years held in bank record

c.

Name & Tel./Mob. No. of the CFO (with e-mail

ID)

Ashwani Kumar 9814113851 #32 sec 2

Chandigarh
kumarbrothers.chd@gmail.com

d.

Works/ Factory I

SCO 7-8 ,Sector 11 D, Chandigarh,

detail as above

e.

Pvt Ltd Co. & 34 as per ladder

f.
g.
h.

Constitution and constitution code as per CBS &

ladder
Date of incorporation/Establishment
Dealing with PNB since
Industry/Sector

i.

Business Activity (Product)/ Installed Capacity.

Retail & whole sale trading of medicines

and surgical equipments, general
merchandize and laboratory equipments
etc.

j.

Corporate Identity No. (CIN)

U51397CH1998PTC021377

12.05.1998
May 2010
Trading

Page 6 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

3. Directors (S/Shri)
Address/Mobile No./e-mail
Name & Designation address of Main Directors/
Guarantor Directors/Key
persons
1.Ashwani Kumar
Singla

9814113851 #32 sec 2

Chandigarh

Whether
Promoter/
Professional/
Nominee

DIN No.

PAN No.

Promoter

00464935

ACBPS1084P

Promoter

00464908

ABCPK2588C

kumarbrothers.chd@gmail.com
2.Parmod Kumar
Singla

#32 sec 2 Chandigarh

a) If any of them, in the list of Caution Advices No

circulated by the Bank from time to
time/RBI's/Willful defaulters' list/Caution List
of ECGC. If yes, action taken
b) If any one of them connected in the past with No
any NPA/OTS/ Compromise/unscrupulous
defaulters
c) If any of them, related to Directors/Senior No
Officers of PNB:
d) i) Management Change since last sanction, if Sh. Karan Singla previously
any
director/Guarantor has resigned

from
company on 10.02.2014 and the same
has already been got amended by the
company with ROC

e)

i) Confirmation that CRs have beenYes No adverse features

compiled/reviewed in terms of extant
guidelines (presently L&A Circular No. 33
dated 31.03.2011) and comments on adverse
features, if any.

Page 7 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

ii) Confirmation that CIRs have been drawn
from
CICs
data
base
(CIBIL/Equifax/Experian/ High Mark) and
comments on adverse features, if any:

Date
Of
CIR

Name

Name of
CIC

Adverse
feature
any
observed
Nil

16.06.14

Ashwani
Singla

Cibil/
Equifax

16.06.14

Parmod
Singla

Cibil/
Equifax

Nil

16.06.14

Vinod
Singla

Cibil/
Equifax

Nil

16.06.14

Sangeeta
Singla

Cibil/
Equifax

Nil

16.06.14

Jagat
Steels

Cibil/
Equifax

Nil

16.06.14

Kumar Bros
(Chem) Pvt
Ltd

Cibil/
Equifax

Nil

26.06.2014

M/s North
India
Surgical Co

Cibil

Nil

26.06.2014

Kumar
Enterprises

Cibil

Nil

26.06.2014

Kumar
Realtors
Pvt ltd

Cibil

Nil

iii) In case of Joint Lending/multipleNA

banking/consortium lending arrangement:
Confirmation that Due Diligence Report from a
professional
(i.e.
Company
Secretary/
Chartered Accountant/Cost Accountant) fromNot applicable as it is not a multiple financing /
banks approved CA/CS on prescribed formatconsortium advance.
(L&A Circular No. 31 dated 28.04.2012) have
been obtained.

If qualified, whether rectified?

Adverse features, if any, are discussed in
the proposal (copy to be enclosed with the
proposal)

Confirmation that Sharing of Information on

Details of other lenders:
prescribed format [L&A Circular No.31/2012 &
99/2012 (compulsory)] have been obtained from
all lenders and adverse features, if any, are
NIL
discussed* in the proposal (copy to be enclosed
with the proposal)
iv) Views/comments for the adverse report about
NIL
the
borrower/guarantor, if any, in the
public domain/media:

Page 8 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

f) Share Holding Pattern as on: 31.03.2014
Name of the Promoters/Major Share
holders

No. of Shares

Amt. in Crore

%Holding

Promoters Holding
FIs/Mutual Funds/UTI/Banks/FIIs

291802

0.29

25.97

Family members
Public
Total

831646

0.83

74.03

1123448

1.12

100.00

g)

Whether Shares pledged to any Bank/FI/others

No

If yes, Percentage of shares pledged

NA

Institution

NA

Purpose

NA

4.A Facilities Recommended :

Nature
Fund Based
CC(H)
WCDL
FOBP/FOUBP/FABC
Others
Fund Based Ceiling
Non Fund Based
ILC/FLC
ILG/ FLG
Non Fund Based Ceiling
Term Loan(O/s)-Car
Limit of credit exposure on
account of all derivative
products
TOTAL COMMITMENT

Existing

Proposed

27.00
0.00
0.00
0.00
27.00

32.00
0.00
0.00
0.00
32.00

0.00
0.50
0.50

0.00
0.50
0.50

0.70

0.66

0.00

0.00

28.20

33.16

(Rs. in Crores )
Secured/Unsecured along with
the basis thereof
(As per RBIs guidelines)
Secured

Car Loans account with BO: Sec 22B Chandigarh. Sanctioned with in
BM Powers.

4.B Our Commitment and Maximum Permissible Exposure Norms

Existin
g

Propose
d

%age of Banks Capital

Funds Rs 41272.67 crore as
at 31.03.14

Compan
y

27.50

33.16

Group

27.50

33.16

(Rs.in Crore )
As per Exposure Norms
Amount

(%age)

0.10%

4952

12%

0.10%

16509

40%

Page 9 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

4. C Short Term Loans/Adhoc Limits sanctioned by PNB in last 12 months, if any

Date
of
sanction
Amount
Period
ROI
Date of
Adjustment
11.06.2013

2.00

4 Months

04.02.2014

3.00

3 Months

06.05.2014

3.00

4 Months

2% over and above

applicable rates
2% over and above
applicable rates
2% over and above
applicable rates

10.10.2013

Roll
over
NA

03.05.2014

NA

04.09.2014

NA

1 The adhoc limit were being allowed to the company to meet with their urgent
requirements due to increased level of turnover/ inventory level and their
additional authorization with some of the Hospitals, the said adhoc was duly
approved by the competent authority and the same were adjusted by the
party on its due date.
4. D Details of facilities provided outside consortium including exposure on account
derivatives, if any
NA
Name of
Institution

the

Nature
facility

of

Security

O/s
as on

Purpose

of

Rate
Interest

of

a)
b)

5.A Facilities from PNB Subsidiaries/Exposure by way of investment in Equity/

Debentures/Derivatives/Foreign Exchange etc. :
NA
(Rs. in Crore)
Name
of
Institution

the Nature
facility

of

Security

O/s
as on

Purpose

Overdue,
any

if

a)
b)
5B. Detail of loans from other Banks/Financial Institutions/Other Institutions - (including WC
limits, Term Loans, Lease, ICDs, Corporate Loans, Debentures etc.)
Name of the Bank/FI
Religare Finvest
India Infoline Finance
Limited

Facility
Sanctioned
8.30
3.30

Balance O/s
as on 30.06.14
7.07
3.08

Overdue, if any
Nil
Nil

(Rs. in Crore)
Rate of Interest
15.15%
15.00%

The Loan raised from Religare Finvest Ltd has been utilised for the business pupose
by the company and the same has strenghthen the liqudity position of the unit. The
said loan is repayable and interest being is secured by the Mortgaged of SCO 7-8
,Sector 11 D, Chandigarh, the name of individuals Sh Ashwani Singla, Vinod Singla and
Smt Sangeeta Singla and Religare Finvest Ltd is not having any charge on any of
Page 10 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

the assets of the company and no any such charge has been created/Regd with
ROC.The amount raised from Religare Finvest Ltd is
being shown as
loans/advances which is contributing toward Margin hence TOL/TNW is on higher
side but this amount has been raised on behalf of the Directors not against the
assets of the company.
(ii) Non-interest Income/Service Charges by other Banks:

NA

5.C
Credit
Rating
by
agencies
{CRISIL/ICRA/CARE/FITCH
Ratings)/SMERA/Brickwork} with purpose of such rating.
Agency

Rating

CARE Ratings

BB (FB)

Date of
Rating
12.09.13

Significance
Purpose
of Rating
Stable
BASEL II

(INDIA

Validity
Date
11.09.14

A4 (NFB)
ERR has due for renewal on 11.09.2014, so we may stipulate that BM to take
up with party that ERR be got done up to 11.12.2014 on the basis of ABS
31.03.2014, otherwise panel interest as per bank guidelines be charged.
5D. Details of Working Capital Limits from the Consortium/Multiple Banking
Name of the
Bank

Existing
FB
NFB

Share %
FB
NFB

Proposed
FB
NFB

(Rs. in Crore)
Share %
ROI
FB
NFB

6. Details of Group /Allied/Associate firms and the facilities sanctioned to them along with
conduct of these accounts with our Bank/ other Banks and comments on adverse
indicators, if any. Facilities to Group Companies:
The details are as per Appendix II
7.A(i) Financial Position of the Company as on close of last three financial years, estimated
for previous year and projected for the next year
(Rs. in Crores)
KEY FINANCIAL
FIGURES:-

31.03.12

31-03-13

31.03.14

31.03.14

31.03.15

31.03.16

M/s Kumar Brothers

Chemist Pvt. Ltd

AUDITED

AUDITED

AUDITED

Accepted
last year

Projected

Projected

GROSS SALES
Domestic
Exports
% growth
Excise Duty
Net sales (net of
excise duty etc.)

55.56
55.56

63.55
63.55

74.65
74.65

75.00
75.00

90.00
90.00

99.00
99.00

25.56

14.38

17.47

0.47

20.56

10.00

55.56

63.55

74.65

75.00

90.00

99.00

Other Income
Operating Profit
Profit Before Tax.
Profit After Tax
Depreciation /
Amortization of
expenses

0.09
0.91
1.00
0.68

0.16
1.17
1.33
0.89

0.26
1.53
1.79
1.19

0.17
1.49
1.66
1.12

0.30
2.03
2.33
1.57

0.35
2.24
2.59
1.75

0.11

0.12

0.12

0.11

0.12

0.11

Page 11 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

Cash Profit
EBIDTA/PBIDTA
Paid Up Capital
Reserves &
Surpluses excl.
revaluation reserves
Deferred Tax Liability
Revaluation Reserve
Misc. Exp. Not W/off
Accumulated Losses
Deferred Tax Assets
Tangible Net worth
Investments in allied
concerns and cross
holdings
Net Owned
Funds/Adjusted
TNW
Share Application
money

0.79
5.17
1.12

1.01
6.66
1.12

1.31
7.19
1.12

1.23
3.18
1.12

1.69
7.85
1.12

1.86
8.20
1.12

4.38
0.00
0.00
0.00
0.00
0.05
5.45

5.24
0.00
0.00
0.00
0.00
0.09
6.27

6.41
0.00
0.00
0.00
0.00
0.09
7.44

6.27
0.00
0.00
0.00
0.00
0.00
7.39

7.89
0.00
0.00
0.00
0.00
0.00
9.01

9.64
0.00
0.00
0.00
0.00
0.00
10.76

0.00

0.00

0.00

0.00

0.00

0.00

5.45

6.27

7.44

7.39

9.01

10.76

0.00

0.00

0.00

0.00

0.00

0.00

Total Borrowings
Secured Loans
Unsecured Loans
Investments
excluding investment
in sister concerns
Total Assets
Current Assets
Non Current Assets

33.16
33.16
0.00

35.13
35.13
0.00

40.26
40.26
0.00

37.66
37.66
0.00

42.31
42.31
0.00

41.71
41.71
0.00

0.23
40.80
39.77
0.98

0.24
48.29
47.17
1.03

0.24
55.76
54.44
1.23

0.24
50.19
49.06
1.13

0.24
62.13
61.02
1.11

0.24
63.42
62.42
1.00

0.44

0.47

0.67

0.57

0.55

0.44

Net Working Capital

Current Ratio
Debt Equity Ratio
Term
liability/Adjusted
TNW
TOL/Adjusted TNW
Operating
profit/Sales(%age)
Fund Flow:

13.74
1.53
1.70

16.52
1.54
1.80

17.12
1.46
1.47

16.92
1.53
1.44

18.21
1.43
1.14

19.47
1.45
0.90

1.70
6.49

1.80
6.70

1.47
6.50

1.44
5.79

1.14
5.90

0.90
4.89

1.64

1.84

2.05

1.99

2.26

2.26

Long Term sources

Long term Uses

14.77
1.03

17.64
1.12

18.44
1.32

18.05
1.13

19.32
1.11

20.47
1.00

Surplus/Deficit
Short Term Sources

13.74
26.03

16.52
30.65

17.12
37.32

16.92
32.14

18.21
42.81

19.47
42.95

39.77
-13.74
4.06

47.17
-16.52
5.21

54.44
-17.12
5.28

49.06
-16.92
1.41

61.02
-18.21
5.40

62.42
-19.47
5.50

Out of which Net

Fixed Assets

Short Term Uses

Surplus/Deficit
Interest

7A (ii) Peer Group Comparison: NA

Page 12 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

7A (iii) Key Financials up to last quarter (as per published Un-audited Results in case
of
listed companies):
(Rs. In Crore)
Period
Cumulative
Corresponding
%
Accepted
%age
Remarks
ended
position as on
position as on
change
for the
achievement
last quarter
quarter of last
current
upto latest
30.06.2014
year 30.06.2013
year
quarter/HY/Q3
Sales
17.38
16.29
6.33
90.00
19.32
satisfactory
Other
0.05
0.02
60.00
0.03
60.00
satisfactory
income
PBT
0.44
0.40
10.00
2.33
18.88
satisfactory
PAT

0.31

0.28

10.00

1.57

19.75

satisfactory

NWC

16.87

14.00

17.00

17.62

95.74

satisfactory

102.15

satisfactory

Current
1.42
1.47
5.00
1.39
Ratio
7A (iv) Details of ADRs/GDRs issued by the borrowing company:
7B.

NA

Brief discussion on Financial Indicators (Interpretation/inference drawn in respect of

Latest financial/ last FY indicators to be discussed)

Paid up capital/TNW
The Authorized capital of the firm is Rs 1.50 crore. The paid up capital of the company is Rs. 1.12
crore as per ABS as at 31.03.2014.
Reconciliation of TNW (Audited) as on 31.03.2014
(Rs. in crore )

TNW as on close of FY ended 31.3.2013

Add: PAT
Less: Inc in DTL
Less: Provisions
TNW as on close of FY ended 31.3.2014

6.27
1.19
0.00
0.02
7.44

Sales
The party has achieved the sales of Rs. 63.55 crore during 2012-13 with percentage growth of
14.38%.
The company had projected sales of Rs. 75.00 crore for the current financial year i.e. 2013-14. The
sales as at 31.03.2014 of the company are Rs. 74.65 crore which is 99.53% of the projected sales.
The progress of the party is satisfactory.
Other income
No other income as on 31.03.2014.The other income in 2012-13 is due to other receipts and
commission.
Profitability
The company is in profit for the last 4 years and with the increase in sales the profit is also showing
increase. The net profit during 2012-13 is Rs. 0.89 and during 2013-14 is Rs. 1.19 crores and is in line
with projections made for the same. The company has projected profit of Rs 1.57 Crores for the year
ending 31.03.2015.
Stock Turn over Ratio
Stock Turn Over ratio is 1.80 and 1.96 for 2012-13and 2013-14 respectively. Party has projected sale
Turn over ratio1.92 for 2014-15.The ratio is low due to the fact that the company has to keep all
sizes/brand of cardiac stunt, operative eye lens and orthopedic equipment, which are very costly in

Page 13 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

nature, resulting in the buildup of heavy inventory. Further company prefers to purchase drugs and
other operative equipment in lot on free product basis resulting in the buildup of heavy inventory, but
improve profitability substantially.
Investments
The company has invested Rs. 0.24 Crore in mutual fund as well as gold outside the business. The
same is accepted as the current ratio is more than benchmark level.
Diversion of funds
BM has informed that No such incidence has been noticed.
NWC/ Current Ratio
As per Balance Sheets, the current ratio of the company is 1.54 as at 31.03.13 and as per ABS
31.03.14 the CR is 1.46. The projected level of CR is 1.43 as at 31.03.15. The CR is above
benchmark level & is satisfactory. NWC is increasing every year and sufficient for proposed limit.
Debt-Equity Ratio-The DER is also within the benchmark.Overall financial position is satisfactory.
7C Capital Market Perception: NA, as the Co. is Pvt Ltd Co.
Listing
Face Value
Current Share Price as on
52 weeks High/Low
Market Capitalisation as on

BSE/NSE
-

7.D
Details of investment in Shares, Debentures, Units or investment of funds
business etc. (Along with comments in case of increase)

outside the

NIL
7.E

Details of Liabilities not accounted for/Contingent liabilities

NIL
Details of derivatives transactions

NIL

7.F

Position of assessment of income tax/sales tax/wealth tax of the borrowing

concern/partners/ proprietor/promoter directors/guarantors
The Company/ Directors have filled income tax for AY 2013-14 and VAT returns upto date
30.06.2014

7.G

Information on litigation initiated by other banks/FIs against the borrower as per latest
Audited Balance Sheet, if any
NA

7.H

Any other adverse features/qualifications in Notes of accounts as per latest Audited

Balance Sheet, if any
NIL

7.I

Overall likely impact of (7.C to 7.H) on the financial position of the borrowing unit
Nil
8. SECURITY
A. Primary
i) For working capital limits

Page 14 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

Hyp. Of stocks medicine, surgical items, equipments, cosmetics etc, Book
debts/receivables arising any of genuine trade transactions and other current assets
of the company.
ii) For Term Loan NA
B. Collateral (Information in respect of mortgage of IP to be given only in the
following format:
i)

Hypothecation/ Mortgage of Block Assets Immovable Properties

Security
Descriptio
n

(I) #32,
Sector -2,
Chandigar
h

Are
a in
Sq
m or
Sq
Ft
205
1 sq
yds

Ownershi
p

Value
Last
sanctio
n

M/s Jagat
Steels pvt
ltd

25.35
valuatio
n dt.
07.11.1
1

Presen
t book
value

Realisabl
e value

27.55

28.00

TOTAL

25.35

27.55
27.55

Basis for
valuation

Date

As per
valuation
report of
Sharma &
Associate
s
As per
valuation
report of
RD
Sharma
BM
Valuation

26.02.1
4

Amt in crore
Whethe
r
existing
/ fresh
Existing
for WC
facilities

22.02.1
4

26.02.1
4

The value of Collateral security is Rs 27.55 crores against exposure of Rs. 32.50 crores, which is
84.76% and in trading advances as per MSME Cir. 67/2014, FGM has power to relaxation in security
up to 50% within his vested power in case of renewal/enhancement. BM has informed that issue

was discussed with the party to provide some additional collateral security in view of
proposed enhancement but they explained that they are presently not in a position to
provide additional security.
BM has also inform that M/s Jagat Steels Pvt Ltd. Is only in existence as the IP mortgaged
as security is in the name of company.There is no other activity in this company.Sh. Parmod
Singla and Sh. Ashwani Singla are directors of the company.There is no change in financials
of the Companys IP ie H.no 32 Sector 2 Chd in the name of M/s Jagat Steels Pvt Ltd. is
already mortgaged with the bank and charge has been noted with ROC as well CERSAI.The
said IP is already mortgaged with us and the same is also proposed to cover the enhanced
WC limits and the same will be got extended. As per Law Cir 17/2014 the provisions of
Section 186 may not be having any impact on the security charged to the bank. However we
may stipulate that BM to ensure that extension of Mortgage on the IP of Company and
obtaining extension of Guarantee is legally enforceable as per New Company law 2013
before release of enhanced facility.
ii) First/Second/Third charge/Paripassu charge (tick mark the appropriate charge)
First charge on the entire block/current assets of the company to secure working capital limit.
iii)Personal/Corporate Guarantee

Page 15 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

Name of
Guarantor

Relationship
with borrower

Net Worth
Prev.
As at

Present
As at

Immovable
property
Prev.
Present
As at
As at

(Rs. In Crores)
Date of confidential
report
Prev.
Present

Vinod
Singla
Ashwani
Singla

Brother of
Director
Director

29.30

28.17

35.25

35.25

01.10.13

17.06.14

22.71

22.06

29.25

29.25

01.10.13

17.06.14

Parmod
Singla

Brother of
Director

15.25

15.45

15.45

15.45

01.10.13

17.06.14

Sangeeta
Singla

Sister in law

10.31

9.19

13.80

13.80

01.10.13

17.06.14

Jagat
Steels Pvt
Ltd(No
activity
now)

Allied
Company

0.53

No
change

0.79

No
change

21.10.201
3

31.03.201
3

As per CRs of the Directors/Guarantors net means shown less than value of IPs as they
have raised loans against their IPs from Fin Companies and it is shown as their liability in
CRs, thereby reducing their net worth as compared to value of IPs.
Guarantee of Sh. Karan Singla is not being proposed for the facilities existing as well as
proposed for enhancement as he has resigned on 10.02.2014.Equity of Sh. Karan Singla
has been taken by the existing Directors and there is no dilution in equity.
iv) Comments on changes, if any
- The Net means of Vinod Singla has decreased due to raising of loans for the personal
use.
- The NMs of Ashwani Singla has decreased due to increase in borrowings from other
bank/ financial insitituion.
- The NMs of Parmod Singla increased due to increased induction of funds.
- The NMs of Sangeeta Singla has decreased due to raising of loans for the personal use.
v)
Status of creation of charge:
BM has confirmed that the charge as per last sanction stand created on 04.02.2014. ROC
search report dated 18.06.2014 held on record.
vi) Status of verification of the IP

Name of the Officer,

who visited the site/IP
Ajay Kumar Kapoor

Designation

AGM

PF No.

79090

8. C Security Margin ( Fixed Asset Coverage Ratio for term loans)

NA
9. Position of Account as on 10.09.2014

Page 16 of 34

Date of Visit

06.06.2014

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

a) WC Limits
Nature
FB

Limit
27.00

VS
44.01

DP
27.00

Balance
26.65

Term Loan
Term Loan-Car-1
Term Loan-Car-2
Term Loan-Car-3
NFB
Total

0.13
0.28
0.28
0.50
28.19

0.14
0.33
0.33
0.08
44.81

0.13
0.28
0.28
0.50
28.19

0.12
0.27
0.27
0.08
27.31

b) Term Loan

(Rs. in Crore)
Irregularity
-

NA

10.A Conduct of the Account including in terms of restructuring done, if any, along with
details of terms & conditions not complied with. Comments on following should be given

Availment of limit, overdrawings, Routing of proportionate business in consortium,

routing of sale proceeds, honouring of commitment in non fund based
facilities(details of LC/LG devolved/invoked with amount), restructuring done, if any
and conduct thereof.
-The limit has been availed adequately and adhoc limit of Rs. 3.00 Cr was permitted on
06.05.14 for a period of 4 Months with in CH Powers stands adjusted on its due date
04.09.2014 .
-Against the sale of 74.56 Crore the credit summations are Rs 71.83 Crore during 201314. The rotation of sales through the account is satisfactory.
-No BG is being revoked.
No restructuring is done in the a/c.
Conduct of the a/c is satisfactory.
Regularity in submission of CMA data/ financial statement/QMS/Stock Statement.
The information regarding no. of cheques/bills returned with amount involved due
to financial reasons during the review period should be mentioned.
The party is regular in submission of CMA data/ financial statement/QMS/Stock
Statement. No such incidents have been observed regarding returning of cheques.
The amount/frequency of irregularity in the account during the review period along
with time taken in regularization thereof should be mentioned.
BM has confirmed that No such incidents have been observed.

Current account maintained with other bank other than Lenders, if any and steps
taken for closing the same.
NA
Specify the details of ECGC claim lodged, if any, during last 5 years: NA

10.B i) Value of the Account

Amt in Crore
Limit

Current year (2013-14)

Nature

Amoun
t

Working

24.00

Last year (2012-13)

Averag Interest/
e Avail Commissio
n
22.01
3.61

Yiel
d
(%)
15.0

Amoun
t

Averag
e Avail

27.00

26.78

Page 17 of 34

Interest/
Commissio
n
3.28

Yiel
d
(%)
12.1

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

capital (FB)
NFB
Term Loan
Bills
purchased/
collected
Any other
income
such as
Escrow
account
fee, etc.
Total

1.00
NA

0.08
NA

0.02
NA

3
0.02
NA

0.50
NA

0.08
NA

0.02
NA

5
NA
NA

NA

NA

NA

NA

NA

NA

NA

NA

NA

NA

NA

NA

NA

NA

NA

NA

25.00

22.09

3.63

15.0
5

27.50

26.86

3.30

12.6
7

10.B ii) Deposits with details

Amt in crore
Current year

Saving
Current
Term deposit
Total

No. of A/c
3248000100919841
3248000100921758
Nil
FD
Nil

Last year
Amount
0.01
0.03
Nil
0.07
Nil

Average
balance

O/S

0.01
0.10

0.01
0.10

Nil
0.07
Nil

0.07

10.B (iii) Value of group accounts-na

10.C

Review of the Account and Summary of irregularities under zero tolerance level and
fraud sensitive index pointed out by Banks Inspectors, Concurrent Auditors, Credit
Audit & Review Division (CA&RD), RBI Inspectors, Statutory Auditors, observations
of Stock Audit Report, Comment on Preventive Monitoring Score Trends, (and status
of rectification of these irregularities)
The details to be given here only as under:

1) Review of the Account

a.
Fund Based Limits
Period

Limit

2013-14

27.00

71.84

77.33

30.00*

23.41

(Rs. in Crore)
Sales
Variation
between sales &
credit
summations
74.82
2.99***

01.04.1431.08.14

27.00

31.99

32.49

29.99*

26.38

29.92

Credit
Debit
Maximum
summation summation Availment

Minimum
Availment

-2.07**

Comments on credit summations in relation to sales: Satisfactory

*Due to Adhoc allowed of Rs 3.00 Crore on 04.02.14 and adjusted on 03.05.14, Again adhoc was
allowed on 06.05.14 and adjusted on 04.09.2014.
**Due to realization of debtors.
*** The difference is due to the reason that the party has made sales on credit.

Page 18 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

b.

Non Fund Based Limits:

Limit
0.50

Issued (Nos.)
2

(Rs. in Crore)
Maximum availment
0.08

Amount
0.08

c. Details of overdue PC & Export Bills:

NA

2) Summary of outstanding irregularities under serious category, zero tolerance level,

fraud sensitive index, as the case may be, pointed out by and status of rectification
i)

Banks Inspectors : NIL

ii) Concurrent Auditors : NIL

iii) Credit Audit & Review Division (CA&RD) :
CARD Report dated 08.01.2014 for Q4 (13-14) (Reply already submitted )
Core Issues:
A.1- ROC search report not obtained before
Latest ROC Research Report dated
release of the enhanced facility.
17.06.2014 is held on record.Pl drop the

item
B) Regular Issues:

B1 -Undertaking that no commission be

paid by the borrower to the guarantors for
guaranteeing the credit facilities
sanctioned by the Bank not held.
B.2 - Before release of enhanced facilities,
the account of M/s Rameshwar Emporium
Pvt. Ltd not got regularized. A/c is running
irregular as on 31.12.2013
B.3- Conduct certificate from various
financial institutions in respect of loan
raised by the co. and guarantors not held
B.4-Vetting of loan documents after
execution of enhanced facility not got
done.
B.5-In narration regarding affixing of
common seal of the Company on loan
document PNB-1031, agreement of hyp.
name of Director in whose presence seal
affixed not mentioned. Resolution date is
also not mentioned
B.6-Resolution regarding who will execute
the documents & whose presence the
common seal will be affixed is not held
C) Other Issues:
C.1-Record of CIBIL reports
on borrower/guarantors needs to be
maintained in a
separate register in

The required undertaking is held on

record. Pl drop the item

The account of M/s Rameshwar

Emporium is closed. Pl drop the item.

The conduct of account with other

banks/FIs is obtained . Pl drop the item.
Vetting of documents has been got done.
Pl drop the item.
Needful has been done . Pl drop the item.

Needful has been done . Pl drop the item.

The desired information stand recorded.

Pl drop the item.

Page 19 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

terms of LA Cir. No. 7/08 along with
the recovery of charges.
C.2 - ROC search report be obtained and
held on record.

Latest ROC Research Report dated

17.06.2014 is held on record.Pl drop the
item

C.3 - Periodical visits to all mortgaged

The desired record is being maintained.PL
securities need to be made as per LA cir
drop the item.
no.7/09 and record thereof be kept in Unit
Inspection Register as per LA cir
No.158/08.
C.4-Certificate of company secretary
ABS as at 31.03.2014 with desired
regarding compliance of various statutory
confirmation is obtained. Pl drop the item
provisions in terms of LA Cir. No.197/08
needs to be obtained on prescribed format.
C.5-CA firm signing ABS needs to be
The necessary verification is done. Pl
ascertained/checked from website of ICAI
drop the item.
and
also confirmation from the auditor
in this regard be held on record as per LA
cir
no.42/09.
C.6-In terms of LA Cir. 33/12 dated
ABS as at 31.03.2014 with desired
21.05.12, a certificate on annual basis
confirmation is obtained. Pl drop the item
should be obtained from borrowers
auditors certifying that all statutory dues
including EPF dues have been paid by the
borrower.
C.7-BM needs to make counter checking
BM Valuation report held on record. Pl
of valuation given by the valuer as per
drop the item.
proforma given in Law Div. cir. No 13/2013
C.8- Branch should take care of the risk
The factors as per Risk Rating are being
factors as conveyed in the Risk Rating
taken care . Pl drop the item.
report approved by CRRD, CO,
Chandigarh on 09.02.2013.
C.9-Branch should ensure compliance of
The desired information has been
guidelines relating to Group codes and
incorporated. Pl drop the item.
rating in CCLD & TRAC in terms of CARD
Cir. No 6/11 & No 2/12.
C.10-Asset ID in respect of each EM while The desired information has been
filing particulars of mortgages with Central
incorporated. Pl drop the item.
Registry needs to be recorded in the Title
Deed Register by incorporating a column
at the top right hand side of the register.
(Ref LA Cir 17/12)
C.11-A certificate from the borrower on
The confirmation is obtained . Pl drop the
quarterly basis furnishing details of
item.
accounts opened with the other banks, if
any, along with the statement of accounts
needs to be obtained in terms of LA Cir
Page 20 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

99/11.
iv) RBI Inspectors : NIL
v)

Statutory Auditors : NIL

vi) Observations of Stock Audit Report : NIL

vii) Comment on Preventive Monitoring Score Trends : HEALTHY
10.D(i)

CONFIRMATION

1.

Compliance of last sanctioned terms

2.

Security documents are valid/duly vetted/enforceable

3.
4.
5.
6.
7.
8.
9.
10.

Yes

Proper charge on securities created

Confirm that company/directors are not under bank/RBI/ECGC/
CIBIL defaulters/caution list
Confirm that payment of statutory liabilities is not in arrears
Confirm that no litigation against/by the company is pending
Corporate governance practices are being followed as per Auditors
report
Confirm that no deviations are made from usual norms/policy guidelines
Confirm that Exposure is within banks internal ceilings/RBI
prudential norms
Confirm that Pre-Sanction Inspection has been carried out in terms of
L&A Cir No. 45 dated 17.04.2013 and report is held

Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes

10.D(ii) AUDIT/INSPECTION/MEETINGS
Particulars
Annual inspection
Stock audit
CARD audit
Consortium meeting
Closure of IR

a)
b)
c)
d)
e)

Last date
31.12.2013
22.11.2013
18.06.2014
NA
07.05.2014

Remarks/Observations/Steps taken
Report stands closed
No observation received from FGMO.
Reply submitted to HO

10.E

In case of audit conducted by RBI Whether commented/special mentioned account

PART II
11.A(i) Industry Rating as per IRMD
The company is in trading business and the industry has not been rated as per LA 106/2014
dt.04.09.2014 as such the same has been treated as neutral.
A.(ii) Detailed Industry Scenario and Comments on management, production and marketing
as well as Borrowers' diversification, expansion, modernisation programme
As per Appendix IV
12. Present Proposal:
Enhancement cum renewal of FBWC limits from Rs 27.00 Crores to Rs 32.00 Crores and
renewal of NFB facility of Rs. 0.50 crores.

Page 21 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

a) Justification for Fund Based Working Capital Limits:
As per PBF calculation as per annexure V.
b) Justification for Non Fund based limits
The existing WC limits i.e. NFB Rs 0.50 Crores was sanctioned on 08.11.2013 under the
vested powers of FGMCAC. Party requested to continue the same.
c) Justification for term loan/FLC/ILC (Capex) : NA
D) Review of existing term loan with present outstanding of Rs. NA
13. Pricing

Rate of interest
Comm. on NFB
Other charges, if any

Facility Existing
Proposed
Applicable rate
In terms of LA Cir No. 48/2014 as applicable to IRR as B-1 and
ERR as BB
CC
BR+2.25%
BR+2.75% -1.00%
BR+2.75%
-i.e.12.50%
(relaxation) i.e.12.00%
i.e.13.00%
BG
As per LA Cir 39/14 As per LA Cir 39/14
As per LA Cir 39/14
CC
NA
Rs 400/- per lacs Max
Rs 400/- per lacs
Rs. 25000/Max Rs.25000/-

ROI/other charges stipulated by other participating banks, if applicable: NA

(a)

Projected income value: NA

14. Other Issues not discussed elsewhere :
1. Relaxation in ROI of 1.00% from Card rate.
The Company is dealing since May2010 and conduct is satisfactory. The proposed facility is
to be collaterally secured by EM of IP worth Rs. 27.55 crore (85% of loan amount). No other
concession ie processing fees etc is being proposed. Company has requested us for
concession in ROI as some banks are after the company to take over the accounts at lower
rate.
Keeping in view the value of account, long association of party, SME category of the unit,
availability of adequate collateral security and satisfactory conduct of account, we
recommend 1.00%relaxation in ROI from Card rate.
15. Strengths & Weakness with mitigants, if any :
Strengths:
1. The company belongs to reputed group trading in Medicines/ surgical items and is
leaders in this part of the country.
2. The financial means of the promoters are very sound.
3. The company is running the activity from the showrooms owned by the promoter
which is near to main hospitals of Chandigarh.
4. All the promoters are from one family.
WEAKNESSES:
1. Many competitors in the same line are in the area.
MITIGANTS:

Page 22 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

1. However the party belongs to reputed group trading in Medicines/Surgical items and
is leaders in this part of the country.
OPPORTUNITIES:
1. The company has potential to add new products used in surgery and other medical
equipments used in the hospitals to increase the sales.
2. The company has received orders from Army.
THREATS:
1. The company has usual threat from the similar units in and around Chandigarh and
nearby areas.
16.A Deviations in the proposal observed by the recommending authority: No deviation is
observed.
16.B

Recommendations :

Keeping in view of the above and PBF calculated as per Annexure-V, we may recommend

Enhancement of FBWC limit from Rs, 27.00 Crores to Rs. 32.00 Crores and Renewal of BG
limit of Rs. 0.50 crores and stipulate that FBWC limit be allowed up to 30.00 Crores for
2014-15 and further availment is to be allowed after looking in to sale level achieved by the
company as on 31.03.2015 on Terms & Conditions as per Annexure-A.

MANAGER (Credit)

CHIEF MANNAGER/AGM

CIRCLE HEAD

Annexure-A
Detailed Terms and Conditions of Sanction-Account M/s Kumar Bros Chemists Pvt Ltd BO:
Sector-22 B, Chandigarh
FACILITY NO I
Nature
Limit
Margin
Interest
Security

Period
FACILITY NO 2 (Existing)
Nature
Limit
Margin
Charges

Cash Credit (Hypothecation of Stocks & BD)

Enhancement of FBWC limits from Rs 27.00 Cr (Rupees Twenty
Seven Crore Only) to Rs 32.00 Cr (Rupees Thirty Two Crore Only) but
limit be restricted to Rs 30.00 crores up to 31.03.2015.
30% for stock and 40% for Book debts
BR+2.75% -1.00% (relaxation) i.e. 12.00% in terms of L& A 48/2014
subject to changes as per bank/ RBI guidelines as applicable to B-1
CRR aligned with BB ERR at monthly rests.
Hypothecation of stocks of medicines surgical equipments cosmetics
general merchandize etc. and Book Debts/ receivables arising out of
genuine trade transactions and other current assets of the company
present and future.
12 months
BG
Rs 50.00 Cr (Rupees Fifty Lac Only) Existing Same
10%
As applicable, however any concession approved by authorities

Page 23 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

specifically be allowed.
Security

Charge on entire current assets of the company and counter indemnity

from the company.
Maximum 3 Years.
PGI, Govt bodies Defence Hospitals and other business related parties

Period
Beneficiary

Other Terms & Conditions:

Charge
Processing/
Documentation
charges

Banks charge is to be registered with ROC.

Processing fees and documentation charges as applicable

COLLATERAL:
i) Mortgage of Block assets immovable Properties (Rs in Crores)
Security
Descriptio
n

(I) 32,
Sector -2,
Chandigar
h

Are
a in
Sq
m or
Sq
Ft
205
1 sq
yds

Ownershi
p

Value
Last
sanctio
n

M/s Jagat
Steels pvt
ltd

25.35

Presen
t book
value

Realisabl
e value

27.55

28.00

27.55
TOTAL

25.35

27.55

Page 24 of 34

Basis for
valuation

Date

Whethe
r
existing
/ fresh

As per
valuation
report of
Sharma &
Associate
s
As per
valuation
report of
RD
Sharma
BM
Valuation

26.02.1
4

Existing
for WC
facilities

22.02.1
4

26.02.1
4

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

ii) First charge on the entire block/current assets of the company to secure working capital limit.
iii) Personal /Corporate guarantee:
Name of
Guarantor

Relationship
with borrower

(Rs Crores)

Net Worth
Prev.
As at

Present
As at

Immovable
property
Prev.
Present
As at
As at

Date of confidential
report
Prev.
Present

Vinod
Singla
Ashwani
Singla

Brother of
Director
Director

29.30

28.17

35.25

35.25

01.10.13

17.06.14

22.71

22.06

29.25

29.25

01.10.13

17.06.14

Parmod
Singla

Brother of
Director

15.25

15.45

15.45

15.45

01.10.13

17.06.14

Sangeeta
Singla

Sister in law

10.31

9.19

13.80

13.80

01.10.13

17.06.14

Jagat
Steels Pvt
Ltd

Allied
Company

0.53

No
change

0.79

No
change

21.10.201
3

31.03.13

1. No commission is to be paid by the borrower to the guarantors for guaranteeing the credit
facilities sanctioned by the bank to the borrower. An undertaking to this effect to be obtained
from the borrower as well as guarantors.
2. The borrower to furnish to the branch the required financial information on the prescribed
Performa within 10 days /or within the specified period, as specifically permitted to enable the
branch to submit quarterly PMS to the banks higher authority.
3. The borrower shall not undertake expansion /diversification /modernization (except those
investment accepted in CMA data) without obtaining prior permission of the bank and without
proper tie-up of funds. Similarly, no investment shall be made in associate/allied group
concerns without prior bank permission.
4. Friends/relatives from whom the unsecured long term loans have been raised shall provide
an undertaking that they shall not withdraw these loans during the currency of the bank loan
and the borrower shall undertake not to allow their withdrawal without prior permission of the
bank.
5. Monies brought in by principal borrower will not be allowed to be withdrawn without the
Banks permission.
6. The Bank or its authorized officials or other representatives will have the right to carry out
periodical inspection or examine the books of accounts of the borrower and to have their
factories/office/assets inspected from time to time by officers of the Bank and/ outside
consultants and the expenses incurred by the Bank in this regard will be borne by the
borrower.
7. The Bank shall have the right to withdraw or modify all/any of the sanctioned conditions or
stipulate fresh conditions, under intimation to the borrower, Borrower shall undertake to give
their acceptance to these stipulations.
8. Stocks Audit will be conducted by the Banks approved Chartered Accountants, on annual
basis. All expenses in connection with the stock audit shall be borne by the borrowers.
9. In case the party commits default in the repayment of loan/advance or in the payment of
interest thereon or any of the agreed installments of the loan on due date the bank, CIBIL
and/or Reserve Bank of India will have an unqualified right to disclose or publish the names

Page 25 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

10.

11.
12.
a)
b)
c)
d)
e)
f)
13.

14.
15.
16.
17.
18.
19.
20.

21.
22.
23.

of the company and its directors as defaulters in such manner and through such medium as
the ban/RBI in their absolute discretion may think fit. (Consent of borrower and guarantors in
terms of LA Cir. No 100/2002 be obtained).
During the currency of banks credit facilities, the borrower shall not, without the prior
approval of the Bank in writing
a. Declare dividends or any year, if the accounts of the borrower with the Bank is/are
running irregular or if any of the terms and conditions of the sanction remain uncomplied with bay the borrower.
b. Permit any transfer of the controlling interest or make any drastic change in the
management set up.
c. Divert/utilize Banks funds to other sister/associate/group concerns or for purposes
other than these for which the credit facilities have been sanctioned.
d. Issue Bonus shares and disposes of share holding of promoters wherever specifically
stipulated. Permit any transfer of the controlling interest or make any drastic change
in the management set up.
Margins/rates of interest are subject to revision from time to time at the sole discretion of the
bank.
The Bank shall charge penal interest under the following circumstances:
Irregularities/over drawings in cash credit accounts.
None-submission/delayed submission of Stock statements after the 10 th of the following
months.
None submission/delayed submission of quarterly review sheet information after 10 days
from the close of the quarter concerned.
Non/delayed submission of renewal proposal with audited Balance Sheet, CMA data and
statement of assets and liabilities of the guarantors after 10 months from the date of sanction.
Default in observance of borrowing covenants/terms and conditions of the sanction.
Any other eventuality/situation to be decided by the Bank.
Borrowers to submit QMS form-1 as per prescribed proforma within six weeks from the close
of every quarter and QMS Form II without 2 months from the close of half year failing which
penal interest, as prescribed by the bank from time to time, will be charged for delayed/none
submission of follow up forms. The company to also submit QIS form 1 as per bank
guidelines.
Branch to ensure compliance of instructions in terms of LA Cir. No. 87/2002 regarding Legal
Compliance Certificate to be submitted to ZO.
Borrower shall give acceptance of terms and conditions as per letter of sanction which will
form part of documentation and be placed on bank records.
Processing, documentation, Inspection charges & commitment charges/prepayment charges
and other service charges to be recovered as per banks guidelines or in terms of sanction.
Concession, if any, to be allowed after approval from competent authority.
Party not to go for expansion/diversification without banks prior permission, Bank reserves
the right to change the existing terms of sanction or stipulate any fresh condition,
That the bank will always be at liberty to stop making further advance or cancel the credit
facility at any time without previous notice and without assigning any reason even though the
said limit/credit facility has not been fully availed of (LA 142/07).
It should be ensured that the company has necessary borrowing powers.
An undertaking to be obtained from the promoters not to off/load their share holding during
currency of banks loan. In addition to the undertaking a declaration from the promoters be
also obtained every year that they continue to hold the shares are co0ntinued to be held in
the name of the promoters.
The company to undertake to maintain the minimum level of Current Ratio 1.33:1 at all times.
Charge to be got registered with ROC within prescribed time and report to be obtained and
held on record.
All other terms and conditions applicable to such type of advances and as conveyed by HO
from time to time are adhered to strictly.

24. BM to ensure that extension of Mortgage on the IP of Company and obtaining

extension of Guarantee is legally enforceable as per New Company law 2013
before release of enhanced facility.
25. BM to take up with party that ERR be got done up to 11.12.2014 on the basis of ABS

Page 26 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

31.03.2014, otherwise panel interest as per bank guidelines be charged.

MANAGER(Credit)

CHIEF MANAGER/AGM

APPENDIX II
(a) Details of Associate/ Allied/ Group concerns and the facilities sanctioned to them (Item No.
6 of the Note).
(Rs in Crore)
Name
of the
Compa
ny

Activity

Financials (Last 3 years)

Page 27 of 34

Dealing
Bank

Faciliti
es
Nature
&
Amou
nt

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

M/s
North
India
surgical
co
partners
hip
concern

Whole
sale
Trading
of
Medicin
e,
surgical
s

Period
Partners
Capital
Add
Reserve
s&
Surplus
Less
Acc.
Losses
&
Intangibl
e Assets
TNW
PBT
Sales

31.03.11
0.11

31.03.12
0.11

31.03.13
0.33

0.72

0.74

0.00

31.03.14 Karur
Vyasa
0.41
Bank
0.00

0.00

0.00

0.00

0.00

0.83
0.03
13.54

0.84
0.03
7.18

0.33
0.17
15.89

0.41
0.08
21.74

31.03.11
0.37

31.03.12
0.53

31.03.13
0.54

0.00

0.00

0.00

31.03.14 CA with
PSB
0.55
Chandig
arh
0.00

0.00

0.00

0.00

0.00

0.37
0.01
1.60

0.53
0.01
1.94

0.54
0.01
1.90

0.55
0.006
2.00

Kumar
Enterpri
ses
Partners
hip :
Parmod
Singla,
Ashwani
Singla,
Dr.
Kewal
Krishan
& Paras
Kumar

Dealers
in
medicin
e and
surgical
items
SCO
355 Sec
32,
Govt
Medical
College
&
Hospital
sec 32
Chd

Period
Partners
Capital
Add
Reserve
s&
Surplus
Less
Acc.
Losses
&
Intangibl
e Assets
TNW
PBT
Sales

Kumar
Realtors
Pvt Ltd
Director
s

Real
estate
develop
ers

Period

31.03.11

31.03.12

31.03.13

Share
capital
Add
reserves
and
surpluse
Less Acc. &
losses &
intangible
assets
TNW
PBT
Sales

0.11

4.33

4.33

31.0CA with
3.14SBI
0.44

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.11
0.00
0.00

4.33
0.00
0.00

4.33
0.00
0.00

0.44
0.00
0.00

FBWC
Rs
7.00
Crores
NFB
Rs
1.00
Crores

No
limit

No
limit

As per family settelment, M/s Rameshwara Emporium and M/s Kumar Mega Mall
Pvt.Ltd are now with the other brothers of Directors Mr. Ashwani Singla and
Sh.Parmod Singla and the said units are not the Allied or Associate concerns of the
company and these units also not availing any credit facilities from our branch/Bank.
M/s Kumar Enterprises is also not availing any credit facility from any bank. The
Page 28 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

conduct of account of Ms North India Surgical Co is satisfactory with their Bank ie

Karur Vysya Bank.
M/s Jagat Steels Pvt Ltd. Is only in existence as the IP mortgaged as security is in
the name of company.There is no other activity in this company.Sh. Parmod Singla
and Sh. Ashwani Singla are directors of the company.
Bm has confirm that company has no other allied/group concern.
Comments on conduct of these accounts with our bank/other banks: The conducts of the
accounts are satisfactory, with the respective banks.
(b)
Comments on adverse Financial Indicators, if any: NA

Manager(credit)

Chief Manager/AGM

Page 29 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

APPENDIX IV
A Detailed Industry Scenario (As per latest updates of the rating agency approved by
the bank for advising the industry rating)
The company is in the trading business of medicines Surgicals etc. The Company is the
biggest chemist in the city. In view of the fact that with the increase in number of ailments
of different types the pharmaceutical companies are coming out daily with new medicines
and the sales trend is increasing. Since the activity is trading and has not been rated by
any rating agency, the industry rating is neutral
B
i

Comments on :Management
The co. is being managed by the Directors who are closely related. The present
management is running the activity successfully and efficiently.
Quality of Management (Including Corporate Governance)
The company is a Pvt Ltd closely held company managed by directors from the same
family. The directors are well versed in the line of activity & the unit is well managed by
the present management and the sales are increasing year by year.

vi

ii

Succession Planning
There is no such planning at present

iii

Production
NA

iv

Marketing
The company is having monopoly in some of the products sold by it in the area and it
has to make fewer efforts for their sale .However the company has employed
professionals to procure tenders from Defence as well as PGI/ Govt Hospitals. The
marketing people are successfully handling their corporate/Govt clients.
General (details such as qualification/experience of directors/ promoters, main
products, capacity, major brands, geographical market for products and major
buyers expertise like technology, brand, marketing, etc.)The promoter / directors
are well experienced in the line of medicine /pharmaceuticals and surgicals which is
their core area.
(C) Borrowers' diversification, expansion, modernisation programme
No such plan at present

Manager (Credit)

Chief Manager /AGM

Appendix-V

Page 30 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

a) Justification for working capital sanction
-

FGMO has sanctioned FBWC limit of Rs. 27.00 crore on 08.11.2013 based
upon estimated sales of RS.75 Cr for 2013-14 and projected level of sales
Rs.80 Crores for 2014-15.In august 2014 party has submitted CMA data
and requested enhancement in FBWC limits from Rs.27 Crores to Rs.32
Crores and OD limit against tangible of Rs. 10.00 crore based upon
estimated sale of Rs. 90.00 crore for 2014-15 and projected sale of Rs.
99.00 crore for 2015-16. BM has recommended the same and proposal
was submitted to HO with our recommendation by accepting the sales
level for 2014-15 as Rs.90 Crores and for 2015-16 as Rs.99 Crores. but
HO vide their letter dated 05.09.2014 has delisted the proposal and
submitted that FGMO may consider the enhancement if any based on
achievement of turnover projected/accepted of 2014-15 of Rs. 80.00 crores
on merits.
Now BM has again recommended for enhancement in FBWC limit from Rs.
27.00 crore to Rs. 32.00 crores by accepting estimated sale of RS. 90.00
crore for 2014-15 and Rs. 99.00 crore for 2015-16 and justify the same as
under.

The company is having its business establishment near to PGI and they
are also supplying Medicines to PGI, the costumers visiting PGI prefer to
go their outlet as they can meet with there every requirement instead of
moving here and there. Most of the costly items relating to Anti Cancer,
Cardiac Stunts, Eyes Lenses, Hepatitis Injections and orthopedic surgical
items are available in market and to be used by the patents needed in
different sizes, Make. They have to keep stocks for all such items to meet
with requirements and in case of emergency. The normal stock holding
also remains on higher side as they have to pick the stocks under Lot
Rate/Free Products Schemes. This going to give a boost to profitability.
The company is not having risk of expiry of Medicines as their supplier
gets returned their products even after the date of expiry.
During current year they have also obtained License for wholesale
trading of Medicines (on 25.06.2014) and also taken on Rent a Godown
in Khudda Lahora in Chandigarh. They also got authorization from Army
Hospitals Commend Hospitals , Army Hospital (RR) Delhi Cantt, These
additions in their business during current year is going to give a boost to
sales level.
The sales achieved by the company up to 31.08.2014 are Rs.30.10 Crs
as against previous year up to 31.08.2013 of Rs.27.00 Crs and the above
additions have been made in Aug2014.
Keeping in view of the past performance of company and observation of
HO vide letter dated 05.09.2014 and justification provided by the Branch
as mentioned above, we are of the opinion that party shall be in a position
to achieve sales of Rs 85.00 crore by 31.03.2015 and Rs.90.00 crore by
31.03.2016 and hence accepted for assessment of PBF.

Page 31 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

i)

Assessment of Fund Based Limits

Sale:

Gross Sales
Domestic
Export
%age

(Rs in crores)
Actual
2011-12
55.56
55.56
0.00
25.56

Actual
2012-13
63.55
63.55
0.00
14.38

Actual
2013-14
74.65
74.65
0.00
17.47

Basic Data per month:

Gross Sales
Domestic
Export
Cost of Sales
Raw Material Consumed
Imported

accepted
2014-15
85.00
85.00
0.00
13.86

Accepted
2015-16
90.00
90.00
0.00
5.88

(Rs in Crores)
Actual
2011-12
55.56
55.56
0.00
48.21

Actual
2012-13
63.55
63.55
0.00
54.65

Actual
2013-14
74.65
74.65
0.00
64.22

accepted
2014-15
85.00
85.00
0.00
72.79

Accepted
2015-16
90.00
90.00
0.00
77.07

0.00

0.00

0.00

0.00

0.00

Basic Data Per Month

Gross Sales
Domestic
Export
Cost of Sales

Actual
2011-12
4.63
4.63
0.00
4.02

Actual
2012-13
5.30
5.30
0.00
4.55

Actual
2013-14
6.22
6.22
0.00
5.35

Accepted
2014-15
7.08
7.08
0.00
6.07

Accepted
2015-16
7.50
7.50
0.00
6.42

Actual
2011-12
0.00
0.00
8.51
0.71
0.33

actual
2012-13
0.00
0.00
8.01
1.06
0.73

Actual
2013-14
0.00
0.00
7.37
1.86
0.82

accepted
2014-15
0.00
0.00
7.62
1.24
0.93

Accepted
2015-16
0.00
0.00
7.62
1.24
0.93

Holding Period in Months

Raw Materials
Stock in Process
Finished Goods
Domestic Receivables
Creditors

Inventory: The party has projected inventory level of 7.62 months against last years
actual of 7.37 months for 2013-14. The Inventory holding is high due to the fact that the
company has to keep all sizes/brand of cardiac stunt, operative eye lens and orthopedic
equipment, which are very costly in nature, resulting in the buildup of heavy inventory. Further
company prefers to purchase drugs and other operative equipment in lot on free product basis
resulting in the buildup of heavy inventory, but improve profitability substantially. P rojected

holding level is in line with the projections and is lower than the last 3 years average
actual holding level of 7.96 months and is justified.

Page 32 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

Receivables: The average credit in this type of activity is 1 to 2 months depending
upon the nature of buyers i.e. Govt hospitals, Defence, general medicines traders. The
last actual holding level is 1.86 months against which the party has now projected level
of 1.24 months for 2014-15 respectively and is justified.
S. Creditors: The Holding level of sundry creditors as at 31.03.2014 is 0.82 months
and the party has projected the holding level at 0.93 months for the current year to
achieve the targets sometimes the pharmaceutical companies supply in bulk at the
year end due to which the level can increase.
OCA:
Particulars

Cash & Bank Balance

Advance to customers
Advance Income Tax
Other assets
Total other Current
Assets

2011-12

2012-13

2013-14

Audited

Audited

Audited

1.90
0.00
0.29
0.12
2.31

3.24
0.00
0.36
0.12
3.72

(Rs in crore)
201516

2014-15
Accepted

Accepte
d

1.58
0.00
0.71
0.05
2.34

1.67
0.00
0.75
0.05
2.47

2.79
0.00
0.50
0.15
3.44

The OCA mainly consists of cash in hand and advance tax / VAT and the amount is
reasonable in view of the last years actual trends.
Other Current Liabilities
Particulars
Sundry Creditors
Advance from customers
Provision for taxation
Others
Total Current Liabilities

201112
Audited
1.53
0.01
0.32
0.28
2.14

2012-13

2013-14

2014-15

Audited
3.47
0.01
0.47
2.85
6.80

Audited
4.56
0.15
0.60
2.66
7.97

6.37
0.19
0.81
2.83
10.20

(Rs in crore)
2015-16

Accepted

Accepted

6.75
0.20
0.86
3.00
10.81

The others Current Liabilities is taken as actual and as per last trend.
NWC:
The available NWC of the party as on date i.e. 31.03.2014 is Rs.16.62 Crore against
which the party has projected NWC of Rs.18.21 Crore as on 31.03.15. The available
NWC is sufficient.

Page 33 of 34

M/S Kumar Bros. Chemists Pvt. Ltd. BO: Sec-22 B Chandigarh

Chargeable Current Assets

Particulars
Raw Materials
Stock in Process
Finished Goods
Domestic Receivables
CCA
Other Current Assets
Total Current Assets (TCA)
Other Current Liabilities

Holding
Period

2014-15
Rate
per
Month

0.00
0.00
7.62
1.24

0.00
0.00
6.07
7.08

2015-16
Amount
(Rs. In
lac)
0.00
0.00
46.25
8.78
55.03

Holding
Period

Rate
per
Month

Amount
(Rs. In
lac)

0.00
0.00
7.62
1.24

0.00
0.00
6.42
7.50

0.00
0.00
48.92
9.30
58.22

2.33

2.47

57.36

60.69

10.20

10.81

Working Capital Gap

47.16

49.88

Minimum Stipulated Margin

(25% of TCA less export
receivable)

14.34

15.18

NWC Projected

17.20

18.21

MPBF
Say

29.96
30.00

31.67
32.00

For calculating PBF for 2014-15,the other Current assets , Other Current Liabilities
and NWC is taken on prorate basis accepting sale of Rs 85.00 Crores instead of Rs.
90.00 Crores projected by the party. Thus we may recommend Enhancement of
FBWC limit from Rs, 27.00 Crores to Rs. 32.00 Crores and stipulate that FBWC limit
be allowed up to 30.00 Crores for 2014-15 as calculated above.

Manager(Credit)

Chief Manager/AGM

Page 34 of 34