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Company Information

Home » Market » Company Information

Alkyl Amines Chemicals Ltd.

Jan 25
3418.35 +101.70 (+ 3.07 %)
VOLUME : 10932
Prev. Close 3316.65
Open Price 3250.00
Bid PRICE (QTY.) 0.00 (0)
Offer PRICE (Qty.) 0.00 (0)
Jan 25
3416.90 +102.45 (+ 3.09 %)
VOLUME : 59896
Prev. Close 3314.45
Open Price 3314.45
Bid PRICE (QTY.) 0.00 (0)
Offer PRICE (Qty.) 0.00 (0)
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Market Cap. ( ₹ ) 17450.94 Cr. P/BV 22.10 Book Value ( ₹ ) 154.61
52 Week High/Low ( ₹ ) 4749/1870 FV/ML 2/1 P/E(X) 59.09
Bookclosure 20/07/2021 TTM EPS ( ₹ ) 60.64 Div Yield (%) 0.29
You can view the entire text of Notes to accounts of the company for the latest year
Year End :2021-03 

Plant, Machinery and Equipment include ' 4.61 lakhs (previous year - ' 17.16 lakhs) being value of machinery installed at third party premises of Job Contractor and Capital Work-In- Progress includes '4.69 lakhs (previous year - NIL), being under construction at third party premises of Job Contractor, duly confirmed by them.

Other Adjustments under Intangible Assets pertains to the grant received during the current year towards the Reach Registration capitalized in the previous year 2019-20.

Capital Expenditure includes NIL (previous year - '17.43 lakhs) and addition to Depreciation includes '16.39 lakhs (previous year- '16.67 lakhs) towards Research & Development activities (Refer Note 28)

On all the above items of Property, Plant and Equipment first charge is created except on Freehold Land, Leasehold Improvements, Buildings at Vashi, Worli,Plot no.D-6/2 at Kurkumbh, all Residential Quarters and Vehicles.

The Company declares and pays dividend in Indian rupees. Final dividend of ' 6/- per share for face value of ' 2/-each (revised due to split of shares dated 12 May 2021), proposed by the Board of Directors is subject to the approval of the shareholders at the ensuing Annual General Meeting.

During the year ended March 31, 2021, the amount per share of final dividend pertaining to the year ended March 31, 2020, distributed to equity shareholders was ' 10/- per share for a face value of ' 5/- each. The dividend appropriation for the year ended March 31, 2021, amounts to '2,039.64 lakhs. During the year ended March 31, 2021, the amount per share of interim dividend pertaining to the year ended March 31, 2021, distributed to equity share holders was ' 10/- per share for a face value of ' 5/- each. The interim dividend appropriation for the year ended March 31, 2021, amounts to '2,041.27 lakhs.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Foreign Currency Term Loans to part finance Company’s normal capital expenditure, which are secured by creation of a pari passu charge on the Company’s immovable properties situated at Plot No. A-7, A-7 (part) and A-25 at Patalganga and Plot no. D-6/1 at Kurkumbh, Maharashtra and also a second pari passu charge by way of hypothecation of Inventories, Book Debts, Movable Machineries which was fully satisfied in December, 2020, for;

Foreign Currency Term Loans to part finance Company’s Dahej Project are secured by creation of a pari passu charge on the Company’s immovable properties situated at Plot No. A-7, A-7 (part) and A-25 at Patalganga, Maharashtra, Plot no. D-6/1 at Kurkumbh, Maharashtra and Plot No. D-2/CH/149/2 at Dahej, Gujarat and also a second pari passu charge by way of hypothecation of Inventories, Book Debts, Movable Machineries, both present and future, for;

The sensitivity analysis have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting year, while holding all other assumptions constant.

The sensitivity analysis presented above may not be representative of the actual change in the projected benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the projected benefit obligation has been calculated using the Projected Unit Credit Method at the end of the reporting year, which is the same method as applied in calculating the projected benefit obligation as recognized in the balance sheet.

There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.

During the Previous year, on November 18, 2019, the Company has disposed of its entire shareholding in its associate, Diamines and Chemicals Limited at a consideration of '3,428.27 Lakhs and earned a profit of '3,284.16 Lakhs. Consequently, with effect from November 18, 2019, Diamines and Chemicals Limited has ceased to be an Associate of the Company. The said profit on sale of investment of '3,284.16 Lakhs has been shown as an Exceptional Item.

Financial and Other Derivative Instruments

Refer Note No. 1 (m), (n) and (o) for accounting policies on Financial Instruments.

1 Capital Management

The Company manages its capital to ensure that it will be able to continue as a Going Concern while maximizing the return to stakeholders through optimization of the Debt and Equity Balance.

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to determine fair value of an instrument are observable, the instrument is included in Level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

ii) Valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

-The fair value of forward foreign exchange contracts is determined using forward exchange rates at the Balance Sheet date.

-The fair value of receivables is considered to be the same as its carrying value due to its short term nature.

-The fair value of current investment in mutual fund Units is based on Net Asset value (NAV), as per The statement provided by The issuer of these mutual fund as at the Balance Sheet date.

iii) Valuation process

The finance department of the Company includes a team that performs the valuations of assets and liabilities required for financial reporting purposes, including level 3 fair values.

iv) Fair value of financial assets and liabilities measured at amortized cost

The carrying amounts of trade receivables, security deposits, cash and cash equivalents, interest accrued on fixed deposits, trade payables and borrowings are considered to be the same as their fair values, due to their short-term nature. The non-current borrowings are at market interest rate and are assumed to be equivalent to its fair value.

v) Fair value of financial assets and liabilities measured at fair value through profit and loss

The carrying amount of current Investments in Mutual Fund are measured at fair value through profit and loss.

42.3 Financial Risk Management Policies and Objectives

The Company, in the course of its business, is exposed to a variety of financial risks, viz. market risk, credit risk and liquidity risk, which can adversely impact the financial performance. The Company’s endeavour is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. The Company has a risk management policy that not only covers the foreign exchange risk but also other risks such as interest rate risk and credit

risk which are associated with financial assets and liabilities. The risk management policy of the Company is approved by its board of directors. The risk management framework focuses on actively securing the Company’s short to medium term cash flows by minimizing the exposure to financial markets.

Presented below is a description of our risks (market risk, credit risk and liquidity risk) together with a sensitivity analysis, performed annually, of each of these risks, based on selected changes in market rates and prices. These analysis reflect the management’s view of changes which are reasonably possible to occur over a one year period. In the event of crisis caused due to external factor such as caused by recent pendemic “”COVID-19””, the management assesses the recoverability of its assets, maturity of its liabilities to factor it in cash low forecast to ensure there is enough liquidity in these situations through internal and external source of funds. These forecast and assumption are reviewed by board of directors.

Market risk

Market risk is the risk of any loss in future earnings, in realizable fair values or in future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates, equity price fluctuations, liquidity and other market changes. Future specific market movements cannot be normally predicted with reasonable accuracy.

Foreign currency exchange rate risk:

The fluctuation in foreign currency exchange rates may have a potential impact on the Statement of Profit and Loss and Equity. This arises from transactions entered into in foreign currency and assets/liabilities which are denominated in a currency other than the functional currency of the Company.

A majority of the Company’s foreign currency transactions are denominated in US Dollars. Other foreign currency transactions entered into by the Company are in EURO. However, the size of these transactions is relatively small in comparison to the US dollar transactions. Thus, the foreign currency sensitivity analysis has only been performed in relation to the US Dollar (USD).

The Company evaluates the impact of foreign exchange rate fluctuations by assessing its exposure to exchange rate risks. Further, in accordance with its risk management policy, the Company hedges its risks by using derivative financial instruments. The use of these instruments facilitates the management of transactional exposures to exchange rate fluctuations because the gains or losses incurred on the derivative instruments will offset, in whole or in part, losses or gains on the underlying foreign currency exposure.

Interest rate risk

Interest rate risk is measured by using the cash flow sensitivity for changes in variable interest rates. Any movement in the Reference rates could have an impact on the Company’s cash flows as well as costs.

The Company has borrowed through a number of financial instruments such as ECBs and working capital demand loans. The Company is subject to variable interest rates on some of these interest bearing liabilities.

The risk estimates provided assume a parallel shift of 50 basis points interest rate across all yield curves. This calculation also assumes that the change occurs at the Balance Sheet date and has been calculated based on risk exposures outstanding as at that date. The year end balances are not necessarily representative of the average debt outstanding during the year.

Interest rate sensitivity

For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. Based on the composition of net debt, a 50 basis points increase / decrease in interest rates over the 12 month period would increase/ decrease the Company’s net finance expense explained as below:

Investment risk

The Company is mainly exposed to the price risk due to its investment in mutual funds. The price risk arises due to uncertainties about the future market values of these investments.

In order to manage its price risk arising from investments in mutual funds, the Company diversifies its portfolio in accordance with the limits set by the risk management policies.

Credit risk

Credit risk is the risk of financial loss arising from counterparty failure to repay or service debt according to the contractual terms or obligations. Credit risk encompasses both the direct risk of default and the risk of deterioration of creditworthiness as well as concentration risks.

Financial instruments that are subject to concentration of credit risk, principally consist of Trade Receivables and Loans.

The Company continuously monitors defaults of customers and other counterparties and incorporates this information into its credit risk controls. The Company’s policy is to deal only with creditworthy counterparties. The Company management considers that all the Financial Assets that are not impaired for each of the reporting dates under review, are of good credit quality, including those that are past due.

In respect of Receivables other than Trade Receivables, the Company’s exposure to any significant credit risk exposure to any single counter party or any groups of counter parties having similar characteristics is considered to be negligible. The credit risk for liquid funds and other short-term Financial Assets is considered negligible, since the counter parties are reputed banks with high quality external credit ratings.

The Company’s exposure to credit risk is limited to the carrying amount of Financial Assets recognized at the Balance Sheet date

The Company evaluate the concentration of risk with respect to trade receivable as low,as its customer are located in several jurisdiction and industries and operate in largely independent market.

Liquidity risk

Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The objective of liquidity risk management is to maintain sufficient liquidity and ensure that funds are available for use as per requirements.

The Company has obtained fund and non-fund based working capital lines from various banks. The Company invests its surplus funds in bank fixed deposits which carry no mark to market risk.

The Company maintains the lines of credit. Nil (PY ' 3.87 Lakhs) Working capital loans that is secured. Interest would be payable at the rate ranging from 4.20% of 9.50%.

The following tables detail the remaining contractual maturities at the end of the reporting period of the Company, which are based on contractual and undiscounted cash flows and the earliest date the Company can be required to pay. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities.

The Company also monitors the level of expected cash inflows on trade and other receivables together with expected cash outflows on trade and other payables

This excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.

43 In view of the restrictions on economic activities due to the second wave of COVID-19 pandemic across the country from midMarch, 2021 and subsequent lockdown in April, 2021, the offices and technical center are kept closed from March and those employees have been working from home, wherever possible.

The Company is in a comfortable financial position to meet its commitments and will be able to meet all its debts obligations as they come up. Internal financial reporting and control are adequate and operating effectively. Although there are uncertainties due to the pandemic, the Company expects that the demand for its products from the pharmaceuticals sector will continue.

44 Previous Year’s figures, wherever necessary, have been regrouped/ reclassified to conform to the current year’s presentation. Figures in brackets, unless specified, represent previous year’s figures.