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Final soft copy of D & B Report of Nomad Films Ltd

Final soft copy of D & B Report of Nomad Films Ltd

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  • 1. BUSINESS SCOPE REPORT NOMAD FILMS LIMITED D&B D-U-N-S® NUMBER: 65-049-4029 Dun & Bradstreet Information Services India Pvt. Ltd. ICC Chambers Saki Vihar Road Powai, Mumbai - 400072 Maharashtra India Tel: + 91-22-28574190 / 92 / 94 Fax: + 91-22-28572060 THIS REPORT MAY NOT BE REPRODUCED IN WHOLE OR IN PART IN ANY FORM OR MANNER WHATSOEVER. This report, furnished pursuant to contract for the exclusive use of the subscriber as one factor to consider in connection with credit, insurance, marketing or other business decisions, contains information compiled from sources which Dun & Bradstreet does not control and whose information, unless otherwise indicated in the report, has not been verified. Dun & Bradstreet in no way assumes any part of the user’s business risk, does not guarantee the accuracy, completeness, or timeliness of the information provided, and shall not be liable for any loss or injury whatsoever resulting from contingencies beyond its control or from negligence.
  • 2. BUSINESS SCOPE REPORT Scope of the Report • History and legal background • Existing operations • Management background • Bankers • Financial statements and analysis Information Sources • Annual reports • Company website Methodology Financial information from the audited annual reports of the Company was studied and analyzed for a three year period. Date: 29th September 2010. Nomad Films Limited 1
  • 3. BUSINESS SCOPE REPORT TABLE OF CONTENTS SUMMARY .............................................................................................................................................................. 4 LINE OF BUSINESS............................................................................................................................................... 5 CURRENT INVESTIGATION .............................................................................................................................. 6 COMPANY PROFILE............................................................................................................................................ 7 FINANCIAL SNAPSHOT ...................................................................................................................................... 8 PROVISIONAL FINANCIAL PERFORMANCE ............................................................................................... 9 REVENUE ............................................................................................................................................................. 10 CUSTOMERS ........................................................................................................................................................ 10 FOREIGN EXCHANGE TRANSACTIONS ...................................................................................................... 11 SUPPLIERS ........................................................................................................................................................... 11 EMPLOYEES ........................................................................................................................................................ 11 REGISTRATION DETAILS................................................................................................................................ 12 CAPITAL DETAILS ............................................................................................................................................. 12 SHAREHOLDING PATTERN ............................................................................................................................ 13 AUDITORS ............................................................................................................................................................ 13 CORPORATE DIRECTORS ............................................................................................................................... 14 EXECUTIVES ....................................................................................................................................................... 14 HEAD OFFICE LOCATION DETAILS ............................................................................................................ 16 PREVIOUS ADDRESS ......................................................................................................................................... 16 GROUP ENTITY .................................................................................................................................................. 17 REGISTRATION .................................................................................................................................................. 18 MEMBERSHIPS ................................................................................................................................................... 18 AWARDS / CERTIFICATIONS.......................................................................................................................... 18 Nomad Films Limited 2
  • 4. BUSINESS SCOPE REPORT FINANCIAL ANALYSIS ..................................................................................................................................... 19 SWOT ..................................................................................................................................................................... 26 ANNEXURE I - CORPORATE DIRECTORS.................................................................................................. 28 ANNEXURE II - FINANCIAL STATEMENTS ................................................................................................ 30 Nomad Films Limited 3
  • 5. BUSINESS SCOPE REPORT SUMMARY ----------------------------------------------------------------------------------------------------------------------------- D&B D-U-N-S® NUMBER : 65-049-4029 COMPANY NAME : NOMAD FILMS LIMITED ADDRESS : A-301/302, Poseidon Tower Panch Marg, Off Yari Road Versova, Andheri West Mumbai - 400061 Maharashtra India TELEPHONE : (91) (022) (26302080) (91) (022) (26321649) FAX : (91) (022) (26321649) WEB PAGE : www.nomadfilmsindia.com EMAIL : info@nomadfilmsindia.com amitabh@nomadfilmsindia.com Junaid@nomadfilmsindia.com ----------------------------------------------------------------------------------------------------------------------------- D&B RATING: 2A2 CONDITION: GOOD ----------------------------------------------------------------------------------------------------------------------------- REGISTRATION NUMBER : 172984 START DATE : 4th April 2003 CONTROL DATE : 9th August 2007 HISTORY : Clear EMPLOYEES (TOTAL) : 15 EXPORTS : Yes REVENUE : INR 150,698 Thousand for the year ended 31st March 2010 TANGIBLE NETWORTH : INR 15,098 Thousand as on 31st March 2010 AUTHORIZED CAPITAL : INR 150,000 Thousand as on 31st March 2010 ISSUED CAPITAL : INR 2,125 Thousand as on 31st March 2010 PAID-UP CAPITAL : INR 2,125 Thousand as on 31st March 2010 ----------------------------------------------------------------------------------------------------------------------------- CHIEF EXECUTIVE : Junaid Abdulrazak Memon Director ----------------------------------------------------------------------------------------------------------------------------- Nomad Films Limited 4
  • 6. BUSINESS SCOPE REPORT LINE OF BUSINESS ----------------------------------------------------------------------------------------------------------------------------- The Company is engaged in advertising business. It is also engaged in production of television commercials, feature films and television serials. It recently started event management also. Standard Industrial Classification Code (SIC) 7812-9903 Produces commercials, television: tape or film 7812-0110 Engaged in television film production 7319-0000 Engaged in advertising RATING KEY --------------------------------------------------------------------------------------------------------------------------- D&B’s Rating consists of 2 parts, the Financial Strength and the Composite Appraisal / Condition. Financial Strength is an indication of the tangible networth (that is, the shareholder’s funds less any intangible assets). The Composite Appraisal / Condition is linked to the level of risk and is an overall evaluation of credit worthiness. It takes into account the financial condition and several factors such as trade reference history, legal structure, management experience and any adverse listings. D&B Indicative Risk Rating of 2A2 implies that the subject has a tangible networth between INR 12,919,000 and INR 64,594,999 as per latest available audited financial statements. Composite appraisal 2 indicates that the overall status of the subject is good. Risk Level of Risk Guide to Interpretation Indicator May proceed with transaction - offer extended 1 Minimal risk terms if required 2 Low risk May proceed with transaction 3 Slightly greater than average risk May proceed with transaction but monitor closely May take suitable assurance before extending 4 Significant level of risk credit - e.g. personal guarantees Insufficient information to assign a No public information or D&B proprietory - Rating information available to indicate trading activity Nomad Films Limited 5
  • 7. BUSINESS SCOPE REPORT CURRENT INVESTIGATION ----------------------------------------------------------------------------------------------------------------------------- On 20th April 2010, Mr. Junaid Abdulrazak Memon, Director, provided the relevant information. Additional information was provided during management discussion. Nomad Films Limited 6
  • 8. BUSINESS SCOPE REPORT COMPANY PROFILE ----------------------------------------------------------------------------------------------------------------------------- Nomad Films Limited (hereinafter referred to as “the Subject” or “the Company”) was established in the year 2002 as a partnership firm by Mr. Junaid Abdulrazak Memon and Mr. Amitabh Bhattacharya. On 9th August 2007, a private limited company was formed to take over the operations of the partnership firm and name changed to Nomad Films Private Limited. It was later converted to a public limited company on 29th September 2009. The Company is engaged in advertising business. It is also engaged in production of television commercials, feature films and television serials. It recently started event management also. It conceptualizes as well as executes the events. The Company earns major revenue from its advertising business. Some of the television commercials produced by the Company includes brands like MetLife-New York, P&G, Reliance ADAG, Henkel, Wrigleys, Coca Cola, Adani Group, Samsung, Pepsi, Volkswagen, Life Insurance Corporation, State Bank of India, etc. It works with following agencies: • Ogilvy and Mather, United States of America • James Walter Thompson, United States of America • Young and Rubicam, United States of America • TBWA Worldwide, United States of America • Mudra Communication Private Limited It represents many international production houses like Eallin Animation, Prague, Arithmetic in respective countries for relevant assignments. The Company is headquartered at Mumbai. The Company’s has sister concerns Guava Creative Solutions Private Limited, Nomad Events Private Limited, Nomad Telefilms Private Limited and Nomad Studios Private Limited are also engaged in the similar businesses. The Company plans to diversify into the production of TV programs and Documentary Films related to Government sector. It has already applied for this project. It is also planning to enter into broadcasting of non News Channel for which it has already applied for the broadcasting license. It will be funding all these projects through bank loans and private equity. It also has plans to expand the business to other foreign countries. The Company is expecting major revenue growth on execution of these projects. Nomad Films Limited 7
  • 9. BUSINESS SCOPE REPORT FINANCIAL SNAPSHOT Comparative Figures (INR in Thousand) FY 2008 FY 2009 FY 2010 Revenue 58,975 51,643 150,698 Net Profit after Tax 2,897 1,130 11,413 Current Assets 30,725 33,732 51,610 Current Liabilities 35,751 43,242 35,937 Working Capital (5,026) (9,510) 15,673 Other Tangible Assets 28,920 28,365 699 Non-Current Liabilities 21,293 15,479 1,274 Tangible Networth 2,601 3,376 15,098 Total Borrowings 23,254 16,508 1,250 Cash and Bank 579 4,647 11,971 Accounts Receivable 10,986 6,450 12,177 Fixed Assets 28,670 28,115 549 Accounts Payable 27,140 26,319 21,699 KEY RATIOS FY 2008 FY 2009 FY 2010 Gross Profit Margin (%) 30.84 17.83 24.95 Operating Profit Margin (%) 7.49 3.68 10.92 Return on Revenue (%) 4.91 2.19 7.57 Return on Networth (%) 111.38 33.47 75.59 Return on Capital Employed (%) 17.08 10.15 101.27 Total Debt Equity Ratio (Times) 8.94 4.89 0.08 Interest Coverage Ratio (Times) 2.91 2.27 - Nomad Films Limited 8
  • 10. BUSINESS SCOPE REPORT PROVISIONAL FINANCIAL PERFORMANCE -------------------------------------------------------------------------------------------------------------------------- As per unaudited financial statement revenue booked by company till September is 7.68 crores. Nomad Films Limited 9
  • 11. BUSINESS SCOPE REPORT REVENUE ----------------------------------------------------------------------------------------------------------------------------- LOCAL : 94% INTERNATIONAL : 6% SELLING TERMS LOCAL TERMS Open Account : 90 days EXPORT TERMS Open Account : 30 days CUSTOMERS ----------------------------------------------------------------------------------------------------------------------------- MAJOR CUSTOMER TYPES Advertising Agencies Television Channels Corporate Companies Government bodies MAJOR CUSTOMER NAMES Length of % Total Name of Customer Country Relationship Revenue (Year) Ogilvy and Mather Private Limited India 21 5 Volkswagen Group Sales India Private India 12 1 Limited Contract Advertising (India) Private India 10 3 Limited Reliance India 8 2 Nomad Films Limited 10
  • 12. BUSINESS SCOPE REPORT FOREIGN EXCHANGE TRANSACTIONS ----------------------------------------------------------------------------------------------------------------------------- (INR in Thousand) Particulars FY 2008 FY 2009 FY 2010 Imports (CIF Value): 2,418 18,175 3,479 Exports (FOB Value): 7,253 - 8,710 SUPPLIERS ----------------------------------------------------------------------------------------------------------------------------- Length of % Share Name of Supplier Country Relationship in Purchase (Year) Set Square India 5 4 Prime Focus Limited India 3 4 Century Communications Private limited India 3 4 Adwertajzing Polland 3 1 VHQ Post (S) Pte Limited Singapore 1 5 EMPLOYEES ----------------------------------------------------------------------------------------------------------------------------- Employees (Head Office location) : 15 Total Current Employees : 15 Nomad Films Limited 11
  • 13. BUSINESS SCOPE REPORT REGISTRATION DETAILS ----------------------------------------------------------------------------------------------------------------------------- LEGAL STRUCTURE : Public Limited Company INCORPORATED : 9th August 2007 REGISTRATION BODY : Registrar of Companies REGISTRATION NUMBER : 172984 Mumbai, Maharashtra India REGISTERED OFFICE : A-301/302, Poseidon Tower Panch Marg, Off Yari Road Versova, Andheri West Mumbai - 400061 Maharashtra India LAST AGM DATE : 23rd September 2009 LAST ANNUAL RETURN DATE : 29th September 2009 LAST FINANCIAL STATEMENT DATE : 31st March 2010 CAPITAL DETAILS ----------------------------------------------------------------------------------------------------------------------------- AUTHORIZED CAPITAL : INR 150,000,000 as on 31st March 2010 ISSUED CAPITAL : INR 2,125,000 as on 31st March 2010 PAID-UP CAPITAL : INR 2,125,000 as on 31st March 2010 ORDINARY SHARES : 212,500 Equity shares at par value of INR 10 each Nomad Films Limited 12
  • 14. BUSINESS SCOPE REPORT SHAREHOLDING PATTERN ----------------------------------------------------------------------------------------------------------------------------- Name of Shareholders Location Shares Held % Held Junaid Abdulrazak Memon India 55,000 25.88 Amitabh Bhattacharya India 27,500 12.94 Sona Bose Bhattacharya India 27,500 12.94 Others India 102,500 48.24 Total 212,500 100.00 Total number of Shareholders :7 Shareholding as on : 31st March 2010 Source: As provided by the Management AUDITORS ----------------------------------------------------------------------------------------------------------------------------- Vijay G. Vaghela & Co 13 Siddhi Sai Prasad CHSL Sai Wadi Dr N S Phadke Marg Andheri East Mumbai – 400069 Maharashtra India Nomad Films Limited 13
  • 15. BUSINESS SCOPE REPORT CORPORATE DIRECTORS ----------------------------------------------------------------------------------------------------------------------------- Name of Directors Current Title Junaid Abdulrazak Memon Director Amitabh Bhattacharya Director Sona Bhattacharya Director Refer Annexure I for details EXECUTIVES ----------------------------------------------------------------------------------------------------------------------------- Name of Executives Current Title Riyaz Memon Head of Production (TV Commercial) Joshua Uppaturu Producer (TV Commercial) Abhijit Aranke Head (Advertising Agency) Roopa Das Creative Head (TV programs) Ashwin Nathane Financial Controller Aroona Bhat Head (Events) Nomad Films Limited 14
  • 16. BUSINESS SCOPE REPORT BANK ----------------------------------------------------------------------------------------------------------------------------- NAME : Citibank NA BRANCH : Parel Branch The Company deals with the Citibank NA since 9th October 2007. Nomad Films Limited 15
  • 17. BUSINESS SCOPE REPORT HEAD OFFICE LOCATION DETAILS ----------------------------------------------------------------------------------------------------------------------------- SIZE OF PREMISE : 2,500 Square feet TYPE OF OCCUPATION : Owned PREMISES USED AS : Administration Office PREVIOUS ADDRESS ----------------------------------------------------------------------------------------------------------------------------- D-71, Shalaka Appartment, D. N. Nagar Behind Ymca Andheri West Mumbai - 400 053 Maharashtra India Date of Change: 25th January 2008 Nomad Films Limited 16
  • 18. BUSINESS SCOPE REPORT GROUP ENTITY ----------------------------------------------------------------------------------------------------------------------------- Name of the Legal Structure Line of Business Entity Guava Creative Private Limited Solutions Advertising Agency Company Private Limited Nomad Events Private Limited Event Management Private Limited Company Nomad Private Limited Production of TV Telefilms Company programs Private Limited Distributor, Marketing and Nomad Studios Private Limited motion pictures and Private Limited Company ownership of IP rights of Motion Pictures Nomad Films Limited 17
  • 19. BUSINESS SCOPE REPORT REGISTRATION ----------------------------------------------------------------------------------------------------------------------------- Permanent Account Number : AACCN7844G Service Tax Registration Number : AACCM7844GST001 Importer exporter code : 0309083150 MEMBERSHIPS ----------------------------------------------------------------------------------------------------------------------------- Association of Motion Pictures and TV Program Producers Indian Motion Pictures Producers Association IQ, Switzerland AWARDS / CERTIFICATIONS ----------------------------------------------------------------------------------------------------------------------------- Goa Fest 2007, Bronze for VFX (TV Commercial for Moser Baer) Nomad Films Limited 18
  • 20. BUSINESS SCOPE REPORT FINANCIAL ANALYSIS ----------------------------------------------------------------------------------------------------------------------------- Revenue and Net Profit Revenue Net Profit 200,000 16,000 INR (In '000) 150,698 11,413 INR (In '000) 150,000 12,000 100,000 8,000 58,975 51,643 2,897 50,000 4,000 1,130 0 0 2008 2009 2010 2008 2009 2010 Revenue Net Profit NOTE: Financials for FY 2008 and FY 2009 pertain to the partnership firm Nomad Films, whereas, the financials for FY 2010 pertain to the public limited company Nomad Films Limited REVENUE The Company is engaged in advertising business. It is also engaged in production of television commercials, feature films and television serials. It recently started event management also. Revenue of the Company declined marginally by 12.43% in FY 2009. However in FY 2010 there was a substantial increase in revenue. Revenue and Net Profit Growth Margins 1200.00 40.00 910.00 30.00 800.00 Percentage 20.00 % 400.00 191.81 10.00 0.00 -12.43 -60.99 0.00 (400.00) 2008 2009 2010 2009 2010 Gross Profit Margin Operating Profit Margin Revenue Growth Net Profit Growth Net Profit Margin Nomad Films Limited 19
  • 21. BUSINESS SCOPE REPORT PROFIT Gross Profit Margin The gross profit margin of the Company declined from 30.84% in FY 2008 to 17.83% in FY 2009 mainly on account of increase in production expenses and cost of technical services in proportion of revenue. The gross profit margin increased to 24.95% in FY 2010 on account of decline in direct expenses in proportion of revenue. Operating Profit Margin Despite a decline in general and administration expenses in proportion to revenue from 20.28% in FY 2008 to 13.51% in FY 2009, operating profit margin declined from 7.49% in FY 2008 to 3.68% in FY 2009 mainly on account of decline in gross profit margin. Operating profit margin increased to 10.92% in FY 2010 mainly on account of increase in gross profit margin. Net Profit Margin The net profit margin declined from 4.91% in FY 2008 to 2.19% in FY 2009 mainly on account of decline in operating profit margin. However, the net profit margin of Company increased to 7.57% in FY 2010 mainly on account of increase in operating profit margin. Nomad Films Limited 20
  • 22. BUSINESS SCOPE REPORT Tangible Networth and Capital Employed Tangible Networth Capital Employed 20,000 36,000 INR (In '000) 15,098 25,855 INR (In '000) 15,000 27,000 19,884 16,348 10,000 18,000 3,376 5,000 9,000 2,601 0 0 2008 2009 2010 2008 2009 2010 Tangible Networth Capital Employed Tangible networth includes equity capital, reserves and surplus less intangible assets, miscellaneous expenditure and accumulated losses, if any. It increased in FY 2009 on account of retention of profit. It increased substantially in FY 2010 as the Company issued shares at a premium and profit retained by Company increased substantially. Capital employed comprises of tangible networth and total debt. It decreased in FY 2009 mainly on account of decline in short and long term loan taken from banks and financials institutions. It further declined in FY 2010 as the company repaid its loans from banks and financials institutions. Composition of Sources of Funds (In Percentage) Particulars FY 2008 FY 2009 FY 2010 Tangible Networth 10.06 16.98 92.35 Total Debt 89.94 83.02 7.65 Capital Employed 100.00 100.00 100.00 Composition of Borrowed Funds (In Percentage) Particulars FY 2008 FY 2009 FY 2010 Short Term Loans 8.43 6.23 - Long Term Loans 91.57 93.77 100.00 Total Debt 100.00 100.00 100.00 Nomad Films Limited 21
  • 23. BUSINESS SCOPE REPORT Short term loans comprised of working capital borrowings from Barclays Bank. Whereas, the long term loans mainly comprised of term loans from banks and financial institution and unsecured loans. Composition of Borrowed Funds (In Percentage) Particulars FY 2008 FY 2009 FY 2010 Secured Loan 91.31 90.94 0 Unsecured Loan 8.69 9.06 100.00 Total Debt 100.00 100.00 100.00 Nomad Films Limited 22
  • 24. BUSINESS SCOPE REPORT Return on Networth and Return on Capital Employed Return on Networth Return on Capital Employed 160.00 120.00 101.27 111.38 Percentage 120.00 Percentage 90.00 80.00 60.00 75.59 40.00 30.00 17.08 33.47 10.15 0.00 0.00 2008 2009 2010 2008 2009 2010 Return on Networth Return on Capital Employed Return on networth declined sharply in FY 2009 on account of increase in tangible networth coupled with decline in profit. However, it increased in FY 2010 on account of growth in profit being more than increase in tangible networth. (In Percentage) Particulars FY 2009 FY 2010 Growth/(Decline) in Profit (60.99) 910.00 Increase in Tangible Networth 29.80 347.22 Return on capital employed declined marginally in FY 2009 on account of decline in EBIT being more than decrease in capital employed. However, it increased in FY 2010 on account of growth in EBIT coupled with a decrease in capital employed. (In Percentage) Particulars FY 2009 FY 2010 Growth/(Decline) in EBIT (54.29) 720.42 Increase/(Decrease) in Capital Employed (23.09) (17.78) Particulars FY 2008 FY 2009 FY 2010 Interest Expenses (INR in Thousand) 1,518 888 0 Average Total Debt (INR in Thousand) - 19,881 8,879 Average Cost of Borrowed Funds (%) - 4.47 - Return on Capital Employed (%) 17.08 10.15 101.27 Return on capital employed was more than average cost of borrowed funds in FY 2009. Nomad Films Limited 23
  • 25. BUSINESS SCOPE REPORT Total Debt Equity Ratio and Interest Coverage Ratio Total Debt Equity Ratio Interest Coverage Ratio 10.00 4.00 8.94 7.50 3.00 2.91 Times Times 2.27 5.00 2.00 4.89 2.50 1.00 0.08 0.00 0.00 0.00 2008 2009 2010 2008 2009 2010 Total Debt Equity Ratio Interest Coverage Ratio Total debt equity ratio is calculated as total debt divided by tangible networth. Total debt equity ratio declined in FY 2009 and FY 2010 on account of increase in networth coupled with a decline in total debt. (In Percentage) Particulars FY 2009 FY 2010 Increase in Tangible Networth 29.80 347.22 Growth/(Decline) in Total Debt (29.01) (92.43) Interest coverage ratio indicates the adequacy of EBIT of the Company to cover its interest obligations. (In Percentage) Particulars FY 2009 FY 2010 Decline in Interest Expenses (41.50) - Growth/(Decline) in EBIT (54.29) 720.42 It decreased in FY 2009 on account of decline in EBIT being more than decline in interest expenses. Nomad Films Limited 24
  • 26. BUSINESS SCOPE REPORT Liquidity Ratios Liquidity Change in Current Assets & Current Liabilities 2.00 120% 1.44 1.50 y-o-y growth 1.44 80% 53% Times 1.00 0.86 0.78 40% 0.86 0.78 10% 21% 0.50 0% 0.00 -17% -40% 2008 2009 2010 2009 2010 Current Ratio Quick Ratio Current Assets Current Liabilities Composition of Current Assets (In Percentage) Particulars FY 2008 FY 2009 FY 2010 Other Loans & Advances 48.03 35.12 47.95 Accounts Receivable 35.76 19.12 23.59 Cash and Bank 1.88 13.78 23.20 Tax Deduced at Source and Advance Tax 13.32 31.06 4.59 Other Deposits 1.01 0.92 0.67 Total 100.00 100.00 100.00 Composition of Current Liabilities (In Percentage) Particulars FY 2008 FY 2009 FY 2010 Accounts Payable 75.91 60.86 60.38 Provision for Fringe Benefit Tax - - 21.68 Provision for Income Tax - - 14.25 Due to Customers - 12.91 2.84 Duties and Taxes Payable 18.11 23.41 - Bank Loan 5.49 2.38 - Other Current Liabilities 0.49 0.44 0.85 Total 100.00 100.00 100.00 Nomad Films Limited 25
  • 27. BUSINESS SCOPE REPORT SWOT ----------------------------------------------------------------------------------------------------------------------------- STRENGTHS Reputed customer base The Company enjoys good relationship with reputed customers and top advertising agencies like Ogilvy and Mather Private Limited, Reliance, Contract Advertising Private Limited, James Walter Thompson etc. which has facilitated repeat orders from them. It is associated with Ogilvy and Mather since 5 years and Contract advertising Private Limited since 3 years. Creative Team Company is currently led by Mr. Junaid Memon, director and Mr. Amitabh Bhattacharya, director. Mr. Junaid Memon has 13 years of experience in related field. Mr. Amitabh Bhattacharya has prior work experience of working with top advertising agencies like James Walter Thompson, Mudra and Leo Burnett. Their relevant experience and creativity helps in driving the business of Company. Moreover, as informed it hires young people which help the Company to have fresh and creative talent. Less reliance on external funds indicating adequate scope to raise additional leverage to fund the expansion plan Debt equity showed a decreasing trend. It decreased to 0.08 in FY 2010. This indicates the Company has scope to fund its future plans through additional leverage. Adequate immediate solvency as indicated by quick and current ratio The Current ratio and quick ratio of the Company were 1.44 in FY 2010 indicating sufficient current assets to pay off its current liabilities. Current and quick ratio of the Company stood at 0.78 in FY 2009. This indicates that the liquidity of Company has improved to make short term payment. Nomad Films Limited 26
  • 28. BUSINESS SCOPE REPORT WEAKNESSES Uneven Gross and Operating profit margin Company had uneven trend in gross profit and operating profit margin throughout the period under study. Both declined in FY 2009. However they increased in FY 2010, they were 24.95 and 10.92 respectively. Net profit margin was 7.57% in FY 2010. Inspite of increase Company has low operating and net profit margins and it needs to improve on its profit margins. Dependence on advertising business As informed, Company earns major revenue from advertising business. It has four major customers which contribute around 51% of total revenue. Moreover, 21% of revenue is earned from Oligvy and Mather Private Limited. This may lead to customer concentration risk. OPPORTUNITIES Scope of expansion to international market Currently revenue from international projects is only 6%. Company has scope of expanding to international market. As informed it has plans to take up some more international projects which will increase the topline of Company. Business growth will help this Industry As the Indian economy is coming out of slowdown, the business growth is back. The inclination of Corporates to spend more on advertisement will help the Company to grow. Expansion in broadcasting business The Company is having expansion plans to launch a non news channel and to undertake government projects. Thus, subject to successful execution of said plan, Company can expect an increase in its topline. THREATS Competition The industry is highly fragmented and therefore exposed to intense competition. Stiff competition may affect the margins of Company. Creative industry As the Company operates in the industry where creativity plays a crucial role, any attrition in the creative team may affect the performance of the Company. Nomad Films Limited 27
  • 29. BUSINESS SCOPE REPORT ANNEXURE I - CORPORATE DIRECTORS ----------------------------------------------------------------------------------------------------------------------------- Name : Junaid Abdulrazak Memon Address : 115/922, Motilal Nagar No 1 Goregaon West Mumbai - 400104 Maharashtra India Date of Birth : 2nd July 1971 Permanent Account Number : ACJPM4289J Director Identification Number : 01295578 Current Title : Director Started with Subject : 4th April 2003 Appointed to present position : 9th August 2007 Education : Diploma in Film making Related Experience since : 1997 Active in daily operations : Yes Name : Amitabh Bhattacharya Address : A-1105-06, hill grange Hiranandani estate G. B. Rd patlipada Thane, 400607 Maharashtra India Date of Birth : 1st March 1968 Permanent Account Number : E3428500 Director Identification Number : 01654859 Current Title : Director Started with Subject : 4th April 2003 Appointed to present position : 9th August 2007 Education : Diploma in Film Making Related Experience since : 1992 Active in daily operations : Yes Nomad Films Limited 28
  • 30. BUSINESS SCOPE REPORT Name : Sona Bhattacharya Address : 1105/06-A, Hill Grange Hiranandani Estate Ghodbunder Road Thane – (W) Thane- 400607 Maharashtra India Date of Birth : 17th July 1969 Permanent Account Number : AJIPB5879K Director Identification Number : 01656550 Current Title : Director Started with Subject : 9th August 2007 Appointed to present position : 9th August 2007 Education : Diploma in Fashion Designing Related Experience since : 1992 Active in daily operations : No Nomad Films Limited 29
  • 31. BUSINESS SCOPE REPORT ANNEXURE II - FINANCIAL STATEMENTS ---------------------------------------------------------------------------------------------------------------------------- Fiscal Balance Sheet as on 31st March 2010 (INR in Thousand) Cash and Bank 11,971 Accounts Payable 21,699 Deposit-Short Term 346 Due to Customers 1,019 Accounts Receivable 12,177 Other Payables / Accruals 308 Loans and Advances 24,747 Prov. Income Tax 12,911 Tax Deducted at Source and 2,369 Advance Tax Total Current Assets 51,610 Total Current Liabilities 35,937 Furniture, Fixtures & Fitting 172 Deferred Taxation 24 Office Equipment 83 Due to Directors / Shareholders 1,250 Computers Servers 294 Total Fixed Assets 549 Total Non-Current Liabilities 1,274 Investment in Affiliates 75 Capital 2,125 Shares 75 Share Premium 2,500 Retained Earnings 11,413 Total Investments 150 Total Equity 16,038 Other Intangibles 940 Total Intangibles 940 TOTAL LIABILITIES AND TOTAL ASSETS 53,249 53,249 EQUITY Nomad Films Limited 30
  • 32. BUSINESS SCOPE REPORT Profit and Loss Account (INR in Thousand) For the year ended 31-Mar-08 31-Mar-09 31-Mar-10 Number of months 12 12 12 Fiscal Fiscal Fiscal Revenue 58,975 51,643 150,698 Less: Cost of revenue (40,786) (42,434) (113,102) Gross Profit 18,189 9,209 37,596 Other Operating Income - 1,084 - General Operating Expenses (12,491) (7,312) (21,059) Depreciation (1,283) (1,082) (78) Net Operating Profit after Depreciation 4,415 1,899 16,459 and before Interest Other Non-Operating Income - 119 97 Total Interest Expenses (1,518) (888) - Net Profit before Tax 2,897 1,130 16,556 Income Tax - - (5,143) Net Profit after Tax 2,897 1,130 11,413 Plus Retained Earnings B/F - - - Retained Earnings C/F 2,897 1,130 11,413 Accounts are audited by Vijay G. Vaghela & Co. Nomad Films Limited 31
  • 33. BUSINESS SCOPE REPORT KEY RATIOS FY 2008 FY 2009 FY 2010 GROWTH TREND Revenue Growth (%) - (12.43) 191.81 Net Profit Growth (%) - (60.99) 910.00 LIQUIDITY Quick Ratio (Times) 0.86 0.78 1.44 Current Ratio (Times) 0.86 0.78 1.44 SOLVENCY Interest Coverage Ratio (Times) 2.91 2.27 - Current Liabilities to Networth (%) 1,374.51 1,280.86 238.02 LEVERAGE Total Debt Equity Ratio (Times) 8.94 4.89 0.08 Total Liabilities to Networth (%) 2,193.16 1,739.37 246.46 Fixed Assets to Networth (%) 1,102.27 832.79 3.64 EFFICIENCY Collection Period (Days) 68 46 29 Revenue to Inventory (Times) - - - Assets to Revenue (%) 101.14 120.24 34.71 Revenue to Net Working Capital (Times) (11.73) (5.43) 9.62 PROFITABILITY Gross Profit Margin (%) 30.84 17.83 24.95 Operating Profit Ratio (%) 7.49 3.68 10.92 Return on Revenue (%) 4.91 2.19 7.57 Return on Assets (%) 4.86 1.82 21.82 Return on Networth (%) 111.38 33.47 75.59 Return on Capital Employed (%) 17.08 10.15 101.27 Nomad Films Limited 32
  • 34. BUSINESS SCOPE REPORT CURRENCY: All amounts in this report are in local currency unless otherwise stated. ----------------------------------------------------------------------------------------------------------------------------- COPYRIGHT (2010) WITH DUN & BRADSTREET THIS REPORT MAY NOT BE REPRODUCED IN WHOLE OR IN PART IN ANY FORM OR MANNER WHATSOEVER. ALL RIGHTS RESERVED. ----------------------------------------------------------------------------------------------------------------------------- This report is forwarded to the Subscriber in strict confidence for the use by the Subscriber as one factor to consider in connection with credit and other business decisions. This report contains information compiled from information which Dun & Bradstreet does not control and which has not been verified unless otherwise indicated in this report. Dun & Bradstreet therefore cannot accept responsibility for the accuracy, completeness or timeliness of the report. Dun & Bradstreet disclaims all liability for any loss or damage arising out of or in anyway related to the contents of this report. This material is confidential and proprietary to Dun & Bradstreet and/or third parties and may not be reproduced, published or disclosed to others without the express authorization of Dun & Bradstreet or the General Counsel of Dun & Bradstreet. -- End of Report -- Nomad Films Limited 33