Shivvani

The company posted a set of very dismal numbers for Q1FY14. When its topline more than halved to Rs.160 crore, down 54% (YoY), and operating costs were 14% higher than the revenue, naturally, the company had to end the quarter in a loss. It posted a consolidated net loss at Rs.143 crore, against net profit of Rs.45 crore (YoY) though lower than the loss of Rs.39 crore in Q4.Its interest cost at Rs.120 crore in Q1 is 75% of its net revenue earned. The company has blamed the fall in turnover on seasonal factors, dehiring of rigs to complete contracts, CBM contract was abandoned and lower revenues from Egypt.

The company has been in the news for all the wrong reasons for some months now. First in Jan’13, there was news of the company evading about Rs.200 crore of service tax. Following the department's action, Shiv Vani gave post dated cheques of Rs 150 crore towards their past service tax liability. Then in Feb, came the news of ONGC banning business dealings with the company for 2 years. This was stated to be because the company failed to  to commence the services, of installation of compressors at Kankinada processing facility,  as per the terms and conditions stipulated by a tender awarded in August 2012. Delaying ONGC projects has been a routine with the company and ONGC has time and again imposed a fine on the company for the delay. Later in April, the company started its contract for gas compression at Kakinada, putting to rest all fears of ONGC banning the company.  Then in August first week, there were rumours of the company winding up as its foreign lenders had issued a  winding up notice to Shiv-Vani for defaulting on dues to the extent of $84.5 million (around Rs 524 crore). The company defaulted on foreign currency convertible bonds (FCCB) on July 16.    The company was quick to issue a clarification, refuting these as baseless rumours. The latest is that the company has now   initiated discussions with its lenders to restructure its debts through Corporate Debt Restructuring (CDR) Mechanism and accordingly have filed a Flash Report with CDR Cell, Mumbai on June 28, 2013.As at 31st March 2013, the company carried a debt of Rs.3,090 crore, on an equity of Rs,46.36 crore (Rs.10 face value). Promoters hold 51.29% stake in the company of which 84.15% is pledged.