Gestetner (India) Ltd.

• Commercial Paper Programme- Rs. 60 million Rating : P1 (Reaffirmed)

A 'P1' (pronounced P one) rating assigned to the Rs 60.0 million commercial paper programme of Gestetner (India) Limited (GIL) has been reaffirmed. The rating factors in GIL's strong market position in copy printers and duplicators, its favourable capital structure and support from the parents viz. Gestetner Holdings, UK and Ricoh Company, Japan, in terms of management support and products. These factors are however offset to a certain extent by the small size of the company, relatively high level of dependence on trading activities (which comprise mainly domestic sales of imported products) and low margins in manufacturing operations.

GIL is engaged in the manufacture and sale of stencil duplicating machines and accessories. The company is also involved in trading of copy printers, digital photocopiers and consumables (ink, masters, stencils, paper, etc). For the year ending December 31, 1998, the company reported a net sales turnover of Rs 614.4 million and a profit after tax of Rs 32.2 million.

GIL is a subsidiary of Gestetner Holdings Plc, UK (GHL), which has a 51% stake in GIL. However, GHL is a fully owned subsidiary of Ricoh Company, Japan (RICOH); consequently RICOH is the ultimate parent of GIL. RICOH has been rated "A- (positive outlook)" by Standard & Poors' and manufactures office automation products like copiers, copy printers, faxes, printers etc. The company also manufactures other products like compact disc re-writeable and recordable products, and cameras. For the year ended March 31, 1999, the total sales of RICOH was 1425.99 billion Yen and the profit after tax was 30.66 billion Yen. RICOH/ GHL has been consistently providing support to GIL in the form of managerial inputs, introduction of new products and low cost credit for import of products.