Industry Insights – Probe42 – Probe Information Services

Company Secretary using Probe42 to increase efficiency

From RoC Search Reports to Company Valuations: How Company Secretaries Can Leverage Probe42

May 17, 2023

“Why does it take so much time to prepare an RoC search report?”

“Is there an easy way to monitor companies where I provide Secretarial services?”

“Can I access and evaluate a company’s detailed legal history at a glance?”

As a Company secretary, these are some questions that might arise on a daily basis. If these resonate with you, discover how Probe42 can increase process efficiency, and reduce turnaround time.

Key Tasks

One of the most time-consuming tasks for company secretaries is preparing an RoC search report. With Probe42, this can be done at the click of a button, reducing the time and cost required to do a search report.

Key tasks such as Valuation, transfer pricing, NCLT & high court cases, business development, insolvency, and monitoring & consulting, are all possible on a single platform.

Valuation is made easier with peer comparison, securities allotment, and financials on unlisted companies. Transfer pricing is streamlined with instant access to the financials of all private companies and standardized formats that are widely used by banks and acknowledged by the RBI.

Improve Business development with lead generation from newly incorporated companies and LLPs, identifying companies due for auditor rotation, and tracking auditor details, their clients, and remuneration.

Access the detailed legal history of a company with a detailed summary of NCLT & high court cases, including arbitration matters, corporate disputes, civil cases, criminal appeals, enforcement of orders, and taxation matters.

Insolvency proceedings of corporates can be overseen, cases filed by/against corporates can be explored, and preferential transaction audits can be conducted with Probe42.

Lastly, monitoring companies where you provide compliance services, assessing the compliance and financial risk of key customers & client suppliers, and 3rd party validation of information provided can all be done with Probe42.

About Probe42

Probe42 is an independent information services company that specializes in offering financial information on unlisted Indian companies.
Our platform has been widely utilized by banks and corporations to aid key processes like business development, credit analysis, KYC and competitor analysis.
Access over 28 Lakh companies, with 500+ Data points on each company, curated from 746 verified data sources on the Probe42 platform.

Probe42 Explainer – The MCA V3 Rollout

By: Probe Research

May 17, 2023

There has been a lot of conversation around the V2 to V3 migration by the Ministry of Corporate Affairs (MCA). We have created a brief explainer for you that provides an overview of the changes, as well as an associated timeline. We’ve also compiled a list of documents that are currently available on the V3.

The Ministry of Corporate Affairs is an Indian Government Ministry that is primarily responsible for enforcing the Companies Act 2013 and the erstwhile Companies Act 1956, the Limited Liability Partnership Act, 2008, and the Insolvency and Bankruptcy Code, 2016. It is in charge of regulating Indian enterprises in the industrial and service sectors.

What exactly are V2 and V3?

Companies in India file e-forms with the MCA for a variety of reasons, including Company Incorporation, Charge Creation/Modification, Directors/KMP’s Appointment/Resignation, address change, and so on. These e-forms were previously available as defined PDF forms that could be downloaded from the MCA website until Version 2 (V2). Users were required to download, fill out, and upload the appropriate e-forms to the MCA website.

In Version 3 (V3), webforms have replaced PDF-based e-forms. Users can choose their webforms and fill out the fields directly online, with added convenience, such as the ability to save a partially completed form and file it later.

While in V2, a “My Workspace” section with a list of notices from the MCA and circulars issued by them was available; in V3, there is a personalised “My Application” section which allows users to view all the forms filed by them, as well as the status of these forms such as – ‘Pending for DSC upload’, ‘Approved’, ‘Under Processing’, etc.

Also, login in the V3 is possible via email ID than just a user ID. This allows for an OTP to be sent to the user’s mobile and e-mail address for increased authenticity.

Current Status

All LLP forms and the 65 company forms listed above have been moved to the V3 system, and will be available as web forms.
Migration of filled-in forms from V2 to V3: The MCA announced that all documents from V2 will eventually move to V3, and V3 to VPD.

The View Public Documents (VPD) service

The MCA allows you to view the public documents of all registered companies/ LLPs through its View Public Documents (VPD) service. Users can view the public documents of a company/ LLP on payment of a fee.

The documents filed in V2, are all available in the VPD.
However, none of the filed V3 documents are currently available for viewing in the VPD.

Annexure

46 company forms made available in V3

Additional Resources https://www.mca.gov.in/content/dam/mca/pdf/SPICEplus-and-linked-filings-FAQs-V3-20230122.pdf

5 Key Ratios for Commercial Loan Underwriting

By: Probe Research

December 28, 2022

Over time, financial ratios have been used to quickly evaluate the financial and operational health of a company. Ratios are precise, yet elaborate enough in their own way.

Most of these ratios can be calculated through financial statements and then compared with industry benchmarks to get a broader understanding. For bankers, the interpretation of the ratio is far more critical than the computation. Validation of solvency and performance are the two essential characteristics of such financial ratios.

Selection of critical ratios is essential for bankers to access asset management, capital management, liquidity, risk, and profitability.

To make it easier we have listed five key financial ratios required for commercial loan underwriting:

Profit Margin Ratio: This is a widely used profitability ratio, and it indicates the amount of profit generated over sales. This ratio measures the company’s ability to earn enough profit to sustain its business. Profit margins often vary from industry to industry, so, a prudent banker should always compare it with close competition and with the average industry standard.

Debt Ratio: This is a solvency ratio, which indicates the debt level of the borrower as a percentage of total assets. A lower debt ratio suggests more stable business and the higher is reverse. A ratio of 0.5 or less is considered as healthy, as this means the company has two times the assets as compared to liabilities. Anything more than 0.5 should be carefully examined before consideration.

Loan to Value (LTV) Ratio: This is a risk assessment coverage ratio that is very critical for mortgage underwriting. The LTV ratio ensures that the collateral is worth higher than the size of the loan. Higher the LTV ratio, more the risk involved.

Debt Service Coverage Ratio (DSCR): This is a liquidity ratio, which indicates the amount of cash generated by the business to service its debts (principal, interest, and leases). DSCR validates the borrower’s capacity to pay back the debt and keep running the business. DSCR between 1.25-1.5 is a relatively safe number to consider. However, it differs from business to business and depends on the risk aversion policies of the bank.

Net Worth to Loan Size Ratio: This ratio is used to compare the borrower’s net worth to the size of the requested loan. A high net worth indicates stable financial health, ultimately ensuring the repayment of the loan.

Ratio analysis is a proven technique to carry out quantitative analysis. However, financial ratios often vary across different industries and sectors, and comparisons between entirely different companies might not be advised.

So, it is advisable to examine industry peers through PEER COMPARISON to get more meaningful insights about the industry.

Use Probe42 to

Access key ratios by downloading financial statements in an excel format
Compare with peers in the same industry

The Probe Newsletter February 2021

By: Probe Research

February 23, 2021

Universe of Registered Companies

As of Jan-2021, there were 22,30,547 companies incorporated out of which 13,17,832 are active.
21.3% companies were incorporated after CY2018.
There are 7,941 active companies in Chandigarh city.
The chart does not include LLPs.

Company Classification

There are 11,295 active foreign companies in India.
269 companies in India has unlimited liabilities.
23,031 companies are not for profit company in India.

Probe New Company and LLP Incorporations Index

The Probe New Company and LLP Incorporations ( PNCLI) Index was constructed using Dec-00 as the base year.
In Jan-21, index value stood at 567 with 178,761 companies registered in the last 12 months.
88,472 companies were incorporated in last 6 months.

New Company Incorporations

In Jan-21, 10,924 companies were incorporated of which 10,681 are private and 243 are public.
During the month of Jan-21, 795 companies were registered in Karnataka state.
2,375 companies were registered under manufacturing business in Jan-21.

Company Incorporations – State-wise data

1,057 companies incorporated in Uttar Pradesh which accounted 9.7% of total incorporation.
In Jan-21, 1,343 companies were incorporated in RoC Mumbai.
During the month of Jan-21, 5.2% of total companies were registered in Haryana state.

LLP Incorporations State-wise data

During the month of Jan-21, 3,293 LLPs were incorporated in India.
Gujarat stood at the 2nd position with 359 new LLP incorporation.
638 LLP were incorporated under the trading business.

Nationwide Spread

There are 1,30,967 active companies which constituted 9.9% of total active companies.
4,159 active company in Delhi are not for profit company.
As of Jan-21, Tamil Nadu has 86,543 active companies.

Statewide Spread – Karnataka

As of Jan-21, there are 88,310 active companies in Karnataka out of which 81.0% incorporated in Bengaluru city.
2,665 companies are registered in Mysuru city.
There are 199 listed companies in Karnataka.

Paid Up Capital

7,03,814 companies has paid up capital of upto Rs 1 lac.
As of Jan-21, 382 companies in Pune has paid up capital of more than Rs 25 cr.
14% of the total active companies has paid up capital between Rs 1 – 5 lac.

Directorship Overview

As of Jan-21, there are 22,30,303 active directors
in India.
Till Jan-21, there are 59,629 active foreign directors in India.
Gujarat has 1,47,233 active directors which constituted 6.6% of total directors.

The Probe Newsletter December 2020

By: Probe Research

December 18, 2020

Universe of Registered Companies

As of Nov-20, there are 22,03,735 companies registered in India out of which 12,93,006 companies are active.
Currently, there are 24,051 active companies in the state of Andhra Pradesh.
19.7% of total active companies were incorporated after CY2018.
The chart does not include LLPs.

Company Classification

Presently, there are 11,62,689 private ltd companies in India.
741 companies are incorporated under the guarantee & association.
There are 2,002 government company in India.

Probe New Company and LLP Incorporations Index

The Probe New Company and LLP Incorporations (PNCLI) Index was constructed using Dec-00 as the base year.
In Nov-20, index value stood at 561 with 139,784 companies and 36,886 LLP registered in the last 12 months.
In the last 6 months, 90,631 companies were incorporated in India.

New Company Incorporations

In Nov-20, 13,453 companies were registered out of which 13,154 were private and 299 were public.
768 OPC (One Person Company) were incorporated in India in Nov-20.
During the month of Nov-20, 1,622 companies were incorporated under the trading business.

Company Incorporations – State-wise data

628 companies were incorporated in the state of Haryana in Nov-20.
In Nov-20, 477 companies were registered under the finance business.
In RoC Ahmedabad, 645 companies were registered in Nov-20.

LLP Incorporations State-wise data

During the month of Nov-20, 3,793 LLPs were incorporated in India.
New LLP registration witnessed decline by 22.5% when compare to Oct-20.
Gujarat with 428 registration stood at 2nd position in terms of LLP registration in Nov-20.

Nationwide Spread

Till Nov-20, there are 1,29,687 active companies in West Bengal which constituted 10.0% of total active companies.
69,580 companies are active in Gujarat state.
As of Nov-20, 6,813 companies are listed in India.

Statewide Spread – Uttar Pradesh

As of Nov-20, there are 89,861 active companies in Uttar Pradesh.
Noida has 13,559 active companies which accounted 15.1% of the total active companies in the state.
260 companies the Uttar Pradesh has paid up capital of more than Rs 2 cr.

Paid Up Capital

Currently, there are 6,85,367 active companies with upto Rs 1 lac paid up capital.
Mumbai has 2,313 companies with paid up capital more than Rs 2 cr.
9.0% active companies have paid up capital between Rs 15-50 lac.