With an increase in working capital by 91.2 per cent last fiscal, the debt- equity ratio of CMC has increased from 0.29:1 to 0.42:1. Loan funds raised by the company as on March 31,2003 were Rs 51.33 crore as compared to Rs 26.85 crore in the previous year.
The company has a total outstanding loan portfolio of Rs 62.23 crore, of which secured loans consist of Rs 12.57 crore and unsecured loans of Rs49.66 crore. It spent an amount of Rs 2.35 crore on interest and finance charges last year.
The company's unsecured loans consist of Rs 5.49 crore interest free loan from the Government of India. Loans repayable within one year are Rs 37.96 crore as compared to Rs 8.75 crore in the previous year.
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Maximum amount outstanding on commercial paper during the year was Rs 20 crore, which was not there in the previous year.
Net current assets of the company were at Rs 115.73 crore compared with Rs 59.25 crore, mainly on account of increase in current assets from Rs 298 crore to Rs 402.6 crore and increase in current liabilities from Rs 238.8 crore to Rs 286.87 crore.
Increase in current assets was attributed to increase in inventory from Rs 11.66 crore to Rs 17.39 crore, increase in sundry debtors from Rs 150 crore to Rs 208 crore and increase in unbilled revenue to Rs 61.32 crore from Rs 41 crore.
The level of debtors in terms of number of days increased from 100 days sales to 125 days mainly on account of large year-end billings.
The unbilled revenue increased from 27 days sales to 37 days sales mainly on account of income accrued on some long term projects being executed by the company, where the billing milestones have not been reached.
The company, in a communication to the investors has warned that the debtor recovery cycle of the company is long due to dominance of government entity in its customer profile resulting in need to finance higher working capital.
The company is broad-basing its client profile in order to reduce the debtor's recovery cycle on one hand and to strengthen the collection efforts on the other hand. In the interim, it is confident to have adequate funding to finance its working capital requirements.