MIRA INFORM REPORT

Report Date :

15^th June 2006

IDENTIFICATION DETAILS

Name :	KHANDELWAL LABORATORIES PRIVATE LIMITED
Registered Office :	79/87, D. Lad Path, Mumbai - 400 033, Maharashtra, INDIA
Country :	India
Financials (as on) :	31.03.2005
Date of Incorporation :	27.09.1945
Com. Reg. No.:	11-4554
CIN No.: [Company Identification No.]	U74999MH1945PTC004554
TAN No.: [Tax Deduction & Collection Account No.]	MUMK10828G
PAN No.: [Permanent Account No.]	AACK42245E
Legal Form :	Private limited liability company.
Line of Business :	Manufacturer and Seller of Pharmaceuticals, Medicinal Chemicals and Botanical products such as Tablets and Capsules, Injectables, Injection Sterile Powder, Orals including Anti-Biotics, Ointments, Granuals, Powders and Fine Chemicals.

RATING & COMMENTS

MIRA’s Rating :

Ba

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Maximum Credit Limit :	USD 750000
Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject is a well established company, controlled and financed by Khandelwal family. Directors are reported as respectable, experienced and resourceful industrialists. Their trade relations are reported as fair. Payments are reported as usually correct and as per commitments. General financial position is satisfactory. The company can be considered normal for business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	79/87, D. Lad Path, Mumbai - 400 033, Maharashtra, INDIA
Tel. No.:	91-22-23718238/46/ 22880156/22829327/23719665
Fax No.:	91-22-23739381/ 23771958
E-Mail :	klab@vsnl.com info@khandelwallab.com it@khandelwallab.com
Website :	http://www.khandelwallab.com
Factory 1 :	Plot B- 1/90, Wagle Industrial Estate, Thane-400 604, Maharashtra
Factory 2 :	Survey - 277/3/6, Dadra (Silvassa)- 396 230, Union Territory

DIRECTORS

Name :	Mr. Sanjeev Khandelwal
Designation :	Chairman
Address :	13, Prem, Niwas, Altamount Road, Mumbai – 400026, Maharashtra, India
Date of Birth/Age :	10/12/1963
Date of Appointment :	20/08/1993
Name :	Mr. Vijay Goel
Designation :	Chairman
Address :	E-348, Greater Kailash – II, New Delhi
Date of Birth/Age :	09/11/1940
Date of Appointment :	18/06/1993
Name :	Mr. R V S Mani
Designation :	Director
Address :	Progressive harmony, Flat No. 26, 2^nd Floor, Plot No- 11, Sector – 44, Kopar Khairane New Mumbai, Maharashtra – 400709, India
Date of Birth/Age :	31/10/1939
Date of Appointment :	25/06/2003

MAJOR SHAREHOLDERS

Names of Shareholders	No. of Shares
Mr. Sanjeev Khandelwal	1499910
Mrs. Sunita Khandelwal	1500000
Mr. Ravindra Khandelwal	90

BUSINESS DETAILS

Line of Business :

Manufacturer and Seller of Pharmaceuticals, Medicinal Chemicals and Botanical products such as Tablets and Capsules, Injectables, Injection Sterile Powder, Orals including Anti-Biotics, Ointments, Granuals, Powders and Fine Chemicals.

Products :

Item Code No.	Product Description
3003.10	Anafortan (Anti Spasmodic)
3003.10	Cefi (Antibiotics)
3003.10	Ofla (Antibiotics)

Export To :

Ethiopia, Myanmar, Nigeria, Philippines, Sri Lanka, Thailand, Trinidad & Tobago.

PRODUCTION STATUS

Particulars	Units	Installed Capacity	Actual Production
Tablets & Capsules	Millions	612	263.437
Injectables	Thousand Litres	26	38.113
Injection Sterile Powder	Thousand Kgs.	117	78.780
Orals Including Antibiotics	Thousand Kgs. /Litres	339	301.74
Granules	Tonnes	18	--
Powders	Tonnes	20	--
Fine Chemicals	Thousand Kgs.	--	1.288
Enzymes	Kgs./ Litres	--	--

GENERAL INFORMATION

No. of Employees :

600

Bankers :

Punjab National Bank

Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

Facilities :

Secured Loans	31.03.2005
Cash Credit Against hypothecation of stocks and book debts (Against equitable mortgage of fixed assets of the company and guaranted by the Directors)	72.929
From others :-
Against hypothecation of vehicles due within 12 months Rs. 0.781 million (Previous year Rs. 0.616 million)	2.060
Total	74.989
Unsecured Loans
From Shareholder’s and Directors	21.705
Total	21.705

Banking Relations :	Satisfactory
Auditors :	Warde & Shah Chartered Accountants Regent Chambers, 12^th Floor, Jamnalal Bajaj Marg, 208, Nariman Point, Mumbai – 400021
Tel. No.:	91-22-283334 / 4455
Fax No.:	91-22-2855336
E-Mail :	prachisa@bom5.vsnl.net.in
Associates/Subsidiaries :	Lumis Biotech Limited
Group Company :	Ø Pinnacle Remedies Private Limited Ø ITX. Com (India) Private Limited Ø Xytech Laboratories Private Limited Ø Radicure Remedies Private Limited Ø Navus Healthcare Private Limited Ø Medicross Healthcare Private Limited Ø Oncure Research Private Limited Ø Khandelwal Brothers Limited Ø Khandelwal Mining & Ores Private Limited Ø Deviprasad Kandelwal & Company Private Limited Ø Kandelwal Ferro Alloys Limited Ø Infinity Optimal Solutions Private Limited Ø Ravisum Agro Investment Private Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
50,00,000	Equity shares	Rs. 10/- each	Rs. 50.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
30,00,000	Equity shares	Rs. 10/- each	Rs. 30.000 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2005	31.03.2004	31.03.2003
SHAREHOLDERS FUNDS
1] Share Capital		30.00	30.000	30.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		159.607	144.106	131.232
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		189.607	174.106	161.232
LOAN FUNDS
1] Secured Loans		74.989	80.245	66.907
2] Unsecured Loans		21.705	10.090	2.355
TOTAL BORROWING		96.694	90.335	69.262
DEFERRED TAX LIABILITIES		7.560	13.404	16.845
TOTAL		293.861	277.845	247.339
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		92.343	95.754	101.720
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		0.124	0.106	1.505
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	140.738	99.651	61.137
	Sundry Debtors	139.021	117.428	130.989
	Cash & Bank Balances	5.865	8.231	6.256
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	69.164	63.396	28.085
Total Current Assets		354.788	288.706	226.467
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	154.298	102.339	90.420
	Provisions	12.139	12.403	1.922
Total Current Liabilities		166.437	114.742	92.342
Net Current Assets		188.351	173.964	134.125
MISCELLANEOUS EXPENSES		13.043	8.021	9.989
TOTAL		293.861	277.845	247.339

PROFIT & LOSS ACCOUNT

PARTICULARS	31.03.2005	31.03.2004	31.03.2003
Sales Turnover [including other income]	695.729	649.115	559.658
Profit/(Loss) Before Tax	25.925	34.825	1.730
Provision for Taxation	(3.744)	2.546	2.320
Profit/(Loss) After Tax	29.669	32.279	(0.590)
Export Value	26.336	13.471	5.299
Import Value	1.278	8.490	24.084
Total Expenditure	669.805	614.289	557.928

KEY RATIOS

PARTICULARS		31.03.2005	31.03.2004	31.03.2003
PAT / Total Income	(%)	4.26	4.94	0.10
Net Profit Margin (PBT/Sales)	(%)	3.72	5.36	0.30
Return on Total Assets (PBT/Total Assets}	(%)	5.74	9.05	0.52
Return on Investment (ROI) (PBT/Networth)		0.13	0.20	0.01
Debt Equity Ratio (Total Liability/Networth)		1.30	1.14	1.00
Current Ratio (Current Asset/Current Liability)		2.13	2.51	2.45

LOCAL AGENCY FURTHER INFORMATION

Fixed assets

Ø Land (freehold and leasehold)

Ø Building, plant and machinery

Ø Other machinery and equipment

Ø Furniture, fixtures and equipment

Ø Vehicles

History

The company was incorporated on 27^th September, 1945 at Mumbai in Maharashtra as a public limited liability company having Company Registration Number 4554.

The company was reconverted as a private limited liability company.

Performance Review

Deposit the competitive market environment, the company registered a growth in sales of 7 % during the year. this was possible due to the successful implementation of growth oriented strategies which helped the company improve its position in the market.

The company will continue its cost effectiveness measures and launch new products to reinforce its competitive edge. The company has also progress in the overseas markets and hopes to increase export by exploring new markets and sustained efforts.

Dividend

The Directors recommend a dividend of Rs. 3.00/- per share.

Name of the company

KHANDELWAL LABORATORIES LIMITED

Presented By

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

1) Date and description of instrument creating the change

28^th June 2004, Hypothecation of goods and Book-debts. Agreement for Bills.

(All the agreements constitute a single charges)

2) Amount secured by the charge/amount owing on the securities of charge

Rs. 85.000 Millions

3) Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

All movable plant and machinery and equipments of whatever nature belong to the borrowers, which shall be brought in the premises of the borrowers aforesaid or anywhere 3else (hereinafter referred to as “the hypothecated machinery”) and

Present and future book debts, outstanding decrees, claims, securities, government subsidies, investments, rights and other movables assets excluding bills purchased / discounts by bank and bills against which advance have been made (all of which are hereinafter referred to as “book debts”) which belong to them and which now or hereinafter from time to time during the continuance of this agreement may belong to them (the ‘said gods’ hypothecated machinery and book debts are hereinafter referred to as Hypothecated assets more fully described in schedule hereunder along with the applicable margins as security for payment of all the amount due and becoming due to the Bank by then towards and in respect of the said facilities including all interest and all other monies due hereunder amount costs, charges and expenses by the Bank under the terms of and for the preservation and protection of the securities created hereunder r under any other security document executed by the borrower in favour of the Bank)

Fund Based : A	Rs in Millions
CC (H) Cash credit	55.000
CC (BD)	(10.000)
FCNR (B)	(41.400)
Packing Credit	(4.500)
Documentary Bills	(7.500)
FOBP/FOUBNLC/FOBP /FOBNLC	(6.000)
Non Fund Based (B)
Inland Letter of credit (DP)	10.000
Foreign letter of credit (DA?DP)	17.000
Letter of guarantee	3.000
Total	30.000
Grand total (A+B)	85.000

4) Gist of the terms and conditions and extent and operation of the charge.

Interest @ 1 % OPLR of Bank / RBI rate subject to change form time to time with presently of 11.75 % p.a.

5) Name and Address and description of the person entitled to the charge.

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

6) Date and brief description of instrument modifying the charge

12^th April 2005

Supplemental deed of hypothecation of goods and Book debts to secure facilities.

7) Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

The cash credit limit is enhanced from Rs. 55.000 millions to Rs. 75.000 millions. The total fund based and Non fund based limit not exceed Rs. 105.000 millions.

Name of the company

KHANDELWAL LABORATORIES LIMITED

Presented By

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

1) Date and description of instrument creating the change

No instrument executed. Only a letter of intent dated 12^th April 2005 to create Equitable Mortgage of various immovable properties of the company (all previous mortgage charges, if any will constitutes a single charges)

2) Amount secured by the charge/amount owing on the securities of charge

Rs. 105.000 millions

Available by M/s Khandelwall Laboratories Private Limited and Rs. 29.500 millions availed by their concern M/s. Lumis Biotech Private Limited

3) Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

All the piece or land or ground bearing plot No. B-1 and B-90 at MIDC Wagle Industrial Estate, Thane together with factory / office building, factory shed etc. constructed thereon.

All that piece or parcel of land or ground of Industrial Land premises bearing survey No. 277/2/6, Part of original survey No. 277 of village Dadra Dist and Sub dist Silvassa, Union Territory of Dadra and Nagarhavel

Factory building together with Non agricultural land for Industrial premises bearing S. No. 134/2 situate at Waghdara, Dist. Silvassa, Union Territory of Dadra and Nagarhavel

4) Gist of the terms and conditions and extent and operation of the charge.

Interest @ 1 % OPLR of Bank / RBI rate subject to change form time to time with presently of 11.75 % p.a.

5) Name and Address and description of the person entitled to the charge.

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

6) Date and brief description of instrument modifying the charge

Not Applicable

7) Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

Not Applicable

Name of the company

KHANDELWAL LABORATORIES LIMITED

Presented By

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

1) Date and description of instrument creating the change

28^th June 2004, Hypothecation of goods and Book-debts. Agreement for Bills.

(All the agreements constitute a single charges)

2) Amount secured by the charge/amount owing on the securities of charge

Rs. 85.000 Millions

3) Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

All movable plant and machinery and equipments of whatever nature belong to the borrowers, which shall be brought in the premises of the borrowers aforesaid or anywhere 3else (hereinafter referred to as “the hypothecated machinery”) and

Present and future book debts, outstanding decrees, claims, securities, government subsidies, investments, rights and other movables assets excluding bills purchased / discounts by bank and bills against which advance have been made (all of which are hereinafter referred to as “book debts”) which belong to them and which now or hereinafter from time to time during the continuance of this agreement may belong to them (the ‘said gods’ hypothecated machinery and book debts are hereinafter referred to as Hypothecated assets more fully described in schedule hereunder along with the applicable margins as security for payment of all the amount due and becoming due to the Bank by then towards and in respect of the said facilities including all interest and all other monies due hereunder amount costs, charges and expenses by the Bank under the terms of and for the preservation and protection of the securities created hereunder r under any other security document executed by the borrower in favour of the Bank)

Fund Based : A	Rs in Millions
CC (H) Cash credit	55.000
CC (BD)	(10.000)
FCNR (B)	(41.400)
Packing Credit	(4.500)
Documentary Bills	(7.500)
FOBP/FOUBNLC/FOBP /FOBNLC	(6.000)
Non Fund Based (B)
Inland Letter of credit (DP)	10.000
Foreign letter of credit (DA?DP)	17.000
Letter of guarantee	3.000
Total	30.000
Grand total (A+B)	85.000

4) Gist of the terms and conditions and extent and operation of the charge.

Interest @ 1 % OPLR of Bank / RBI rate subject to change form time to time with presently of 11.75 % p.a.

5) Name and Address and description of the person entitled to the charge.

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

6) Date and brief description of instrument modifying the charge

12^th April 2005

Supplemental deed of hypothecation of goods and Book debts to secure facilities.

7) Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

The cash credit limit is enhanced from Rs. 55.000 millions to Rs. 75.000 millions. The total fund based and Non fund based limit not exceed Rs. 105.000 millions.

Name of the company

KHANDELWAL LABORATORIES LIMITED

Presented By

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

1) Date and description of instrument creating the change

28^th June 2004, Hypothecation of goods and Book-debts. Agreement for Bills.

(All the agreements constitute a single charges)

2) Amount secured by the charge/amount owing on the securities of charge

Rs. 85.000 Millions

3) Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

All movable plant and machinery and equipments of whatever nature belong to the borrowers, which shall be brought in the premises of the borrowers aforesaid or anywhere 3else (hereinafter referred to as “the hypothecated machinery”) and

Present and future book debts, outstanding decrees, claims, securities, government subsidies, investments, rights and other movables assets excluding bills purchased / discounts by bank and bills against which advance have been made (all of which are hereinafter referred to as “book debts”) which belong to them and which now or hereinafter from time to time during the continuance of this agreement may belong to them (the ‘said gods’ hypothecated machinery and book debts are hereinafter referred to as Hypothecated assets more fully described in schedule hereunder along with the applicable margins as security for payment of all the amount due and becoming due to the Bank by then towards and in respect of the said facilities including all interest and all other monies due hereunder amount costs, charges and expenses by the Bank under the terms of and for the preservation and protection of the securities created hereunder under any other security document executed by the borrower in favour of the Bank)

Fund Based : A	Rs in Millions
CC (H) Cash credit	55.000
CC (BD)	(10.000)
FCNR (B)	(41.400)
Packing Credit	(4.500)
Documentary Bills	(7.500)
FOBP/FOUBNLC/FOBP /FOBNLC	(6.000)
Non Fund Based (B)
Inland Letter of credit (DP)	10.000
Foreign letter of credit (DA?DP)	17.000
Letter of guarantee	3.000
Total	30.000
Grand total (A+B)	85.000

4) Gist of the terms and conditions and extent and operation of the charge.

Interest @ 1 % OPLR of Bank / RBI rate subject to change form time to time with presently of 11.75 % p.a.

5) Name and Address and description of the person entitled to the charge.

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

6) Date and brief description of instrument modifying the charge

Dated 9^th July, 2005

Hypothecation of goods and book dents and block assets as security to secure all credit facilities

Term loan agreement

(Both the agreements constitute a single charges)

7) Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

Original charges created on 28^th June 2004 for Rs. 85.000 millions

First modification dated 12^th April 2005 by which the cash credit limit is enhanced from Rs. 55.000 millions to Rs. 75.000 millions, thereby raising total charge from Rs. 85.000 millions to Rs. 105.000 millions which is registered on 9^th May, 2005 by the present modification the charges on stock, book debts bills, movable plant and machinery situated at

Plot no. B-1 MIDC Thane adm. 2575 Lacs.

At Dadra s. no. 277/3/6

At Wagahdra S. No. 134/2

At Pantnagar, Uttaranchal is enhanced form Rs. 105.000 millions to Rs. 165.000 millions by an additional limit of Rs. 60.000 millions as under:

Fund Based : A	Rs in Millions
Cash credit	75.000
FCNR (B)	(41.400)
Book Debts	(10.000)
Bill discount	(5.000)
Packing Credit	(4.500)
Documentary Bills	(7.500)
FOBP/FOUBNLC/FOBP /FOBNLC	--
Non Fund Based (B)
Inland Letter of credit (DP)	10.000
Foreign letter of credit (DA?DP)	17.000
Letter of guarantee	3.000
Total	30.000
Grand total (A+B)	165.000

Name of the company

KHANDELWAL LABORATORIES LIMITED

Presented By

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

1) Date and description of instrument creating the change

No instrument executed. Only a letter of intent dated 12^th April 2005 to create Equitable Mortgage of various immovable properties of the company (all previous mortgage charges, if any will constitutes a single charges)

2) Amount secured by the charge/amount owing on the securities of charge

Rs. 105.000 millions

Available by M/s Khandelwall Laboratories Private Limited and Rs. 29.500 millions availed by their concern M/s. Lumis Biotech Private Limited

3) Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

All the piece or land or ground bearing plot No. B-1 and B-90 at MIDC Wagle Industrial Estate, Thane together with factory / office building, factory shed etc. constructed thereon.

All that piece or parcel of land or ground of Industrial Land premises bearing survey No. 277/2/6, Part of original survey No. 277 of village Dadra Dist and Sub dist Silvassa, Union Territory of Dadra and Nagarhaveli

Factory building together with Non agricultural land for Industrial premises bearing S. No. 134/2 situate at Waghdara, Dist. Silvassa, Union Territory of Dadra and Nagarhaveli

4) Gist of the terms and conditions and extent and operation of the charge.

Interest @ 1 % OPLR of Bank / RBI rate subject to change form time to time with presently of 11.75 % p.a.

5) Name and Address and description of the person entitled to the charge.

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

6) Date and brief description of instrument modifying the charge

No instrument

Bank letter dated 9^th July 2005

(for equitable mortgage)

7) Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

Original charges created on 12^th April, 2005 for Rs. 105.000 millions

By the present modification the charges for Equitable Mortgage has been extended form Rs. 105.000 millions to Rs. 165.000 millions in respect following immovable properties.

All the piece or land or ground bearing plot No. B-1 and B-90 at MIDC Wagle Industrial Estate, Thane together with factory / office building, factory shed etc. constructed thereon.

All that piece or parcel of land or ground of Industrial Land premises bearing survey No. 277/2/6, Part of original survey No. 277 of village Dadra Dist and Sub dist Silvassa, Union Territory of Dadra and Nagarhaveli

Factory building together with Non agricultural land for Industrial premises bearing S. No. 134/2 situate at Waghdara, Dist. Silvassa, Union Territory of Dadra and Nagarhaveli

All the piece or parcel of land or ground bearing plot No. B-1 and B-90 at MIDC Wagle Industrial Estate, Thane adm. 2575 sq. mtrs. together with factory / office building, factory shed etc. constructed thereon.

Name of the company

KHANDELWAL LABORATORIES LIMITED

Presented By

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

1) Date and description of instrument creating the change

28^th June 2004, Hypothecation of goods and Book-debts. Agreement for Bills.

(All the agreements constitute a single charges)

2) Amount secured by the charge/amount owing on the securities of charge

Rs. 85.000 Millions

3) Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

All movable plant and machinery and equipments of whatever nature belong to the borrowers, which shall be brought in the premises of the borrowers aforesaid or anywhere 3else (hereinafter referred to as “the hypothecated machinery”) and

Present and future book debts, outstanding decrees, claims, securities, government subsidies, investments, rights and other movables assets excluding bills purchased / discounts by bank and bills against which advance have been made (all of which are hereinafter referred to as “book debts”) which belong to them and which now or hereinafter from time to time during the continuance of this agreement may belong to them (the ‘said gods’ hypothecated machinery and book debts are hereinafter referred to as Hypothecated assets more fully described in schedule hereunder along with the applicable margins as security for payment of all the amount due and becoming due to the Bank by then towards and in respect of the said facilities including all interest and all other monies due hereunder amount costs, charges and expenses by the Bank under the terms of and for the preservation and protection of the securities created hereunder under any other security document executed by the borrower in favour of the Bank)

Fund Based : A	Rs in Millions
CC (H) Cash credit	55.000
CC (BD)	(10.000)
FCNR (B)	(41.400)
Packing Credit	(4.500)
Documentary Bills	(7.500)
FOBP/FOUBNLC/FOBP /FOBNLC	(6.000)
Non Fund Based (B)
Inland Letter of credit (DP)	10.000
Foreign letter of credit (DA?DP)	17.000
Letter of guarantee	3.000
Total	30.000
Grand total (A+B)	85.000

4) Gist of the terms and conditions and extent and operation of the charge.

Interest @ 1 % OPLR of Bank / RBI rate subject to change form time to time with presently of 11.75 % p.a.

5) Name and Address and description of the person entitled to the charge.

Punjab National Bank, Foreshore Road, 102, Raheja Chambers, Nariman Point, Mumbai - 400 021

6) Date and brief description of instrument modifying the charge

Not Applicable

7) Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

Not Applicable

As per website

Khandelwal Laboratories

Pvt. Limited (KLab)

Khandelwal Laboratories Pvt. Limited (KLab) was founded in 1945 and is in the business of manufacturing and marketing of speciality pharmaceutical formulations, niche APIs, chiral intermediates, Novel Drug Delivery Systems and Research.  KLab is a pioneer and leader in Oncology and pain and spasm management.

Klab was the first company in India to launch the following products :

* Camylofin Dihydrochloride (an antispasmodic),
   Cyclophosphamide, Ifosfamide and Mesna
   under collaboration with M/s. Asta Medica,
   Germany.

* Methocarbamol (muscle relaxant),
   Glycopyrrolate (anti-cholinergic)  and
   Doxapram (respiratory stimulant) under
   collaboration with M/s. A.H. Robins, USA.

* Bleomycin, Etoposide, Cisplatinum under
   collaboration with M/s. Nippon Kayaku, Japan.

* Iron Polymaltose under collaboration with
   M/s. Hausman Laboratories, Switzerland.

* Cefixime OD (Once a day) they have an
   Indian Patent.

Klab has now developed and is marketing 40 chiral intermediates.

Klab has recently started focusing on exports and is now having products which are registered and under registration in the African Continent, Middle East, South-East Asia, Latin America and the Caribbean.

Proposed new Facility In Uttaranchal As Per Latest USFDA Guidelines

The production is likely to start by Dec 2005. In this Unit they are planing for only Tablet section 1) General tablet and 2) Cephalosphorin tablets. The install capacity for General tablet is 45.0Lac tablet for 10 hr. and Cephalosphorin section is 8.0Lac tablet per 10hrs.
They have dedicated 50% capacity for P2P and Loan license products. If you are interested to utilize for the voluminous products they can dedicate some capacity for you.

PRESCRIPTION MEDICINES

Their Pharmaceutical product line includes:
Antispasmodic,
Skeletal Muscle Relaxants,
Nsaids,
Anti-Hypertensives,
Anti-Ulcerants,
Antimalarials,
Anti-Virals, Anti-Allergics,
Anthelmentics,
Biphosphonates,
Anti-Impotence,
Anti-Cholinergic,
Respiratory Stimulants,
Antibacterials (N.D.D.S), 
Antiasthamatics & Antitussives

CHIRAL Intermediates

Their Chiral Intermediates range Includes:
Monosaccharides
    Derivatives,
1,2-Amino Alcohols,
Aminoacids
Tartaric Acid
    Derivatives,
Resolving Agents,
Oxazolidinones

APi 's

Cisplatin IP/BP/USP
Cyclophosphamide
    IP/BP/USP
    (Sterile & Tablet Grade)
Doxapram Hydrochloride
    IP/BP/USP
Glycopyrrolate Usp
Tamoxifene Citrate
    IP/BP/USP
Carboplatin IP/BP/USP
Flurouracil IP/BP/USP
Gemcitabine IP/BP/USP
Hydroxy urea IP/BP/USP
Letrazole IP/BP/USP
Methotrexate IP/BP/USP

Clinical Research Services in Oncology.

Formulation Development.

Lead identification in Oncology.

NDDS technologies and NDDS
   development.

Technology for manufacture of Oncology
   formulations and APIs.

Product Dossiers for Registration of 
   Formulations and APIs.

Promotional materials like Visual Aids /
   Technical Literature.

In depth training of Sales Persons in 
   Marketing and Medical areas.

Arranging Seminars by top level doctors.

CONTRACT RESEARCH

Clinical trials and research in the field of Oncology.
NCE lead identification in the field of Oncology.

Development of NDDS formulations.

Development of Chiral Intermediates.

Development of Generic Formulations

NICHE MARKETING

Focus on Oncology Doctors and Institutions.
Focus on Unique Products
Focus on NDDS formulation Marketing
Since they deal with unique products they have to build markets by convincing the doctors technically about their product benefits.

Their multi-disciplinary team of high caliber scientists, technologists and academics are supported by a state-of-the-art infrastructure. Their unique cross-fertilization of ideas, across disciplines and corporate hierarchies, has evolved a process of cutting edge integration.

This integrated mindset assimilates both in-house and freelance research expertise, private & governmental, so allowing us to continually and swiftly innovate new technologies. This innovation defines their ethos and economic efficiency, it influences every aspect of their corporate structure.

Chiral intermediates developed

Monosacharide Derivatives / Glycols

Tartaric Acid Derivatives

1,2,Amino Alcohols

Oxazolidones

Resolving Agents.

Novel Drug Delivery System developed and Patent applied for

Liposomal Doxorubicin

Cefixime OD

Alendronate (special coating)

Prenoxdiazine HCl.

Patents applied for over forty formulations.

Lead Identifications

Identification of new chemical entities in

the field of cancer treatment.

APIs developed

Cyclophosphamide

Tamoxifen HCl.

Cisplatin

Carboplatin*

Gemcitabine*

Methotrexate

Hydroxyurea

*under development

INTERNATIONAL NETWORK

Klab has to its credit 38 registrations s in 8 countries and 380 registration files are under registration in 29 countries.

Countries where their products are registered

ETHIOPIA, MYANMAR, NIGERIA, PHILIPPINES, SRI LANKA, THAILAND, TRINIDAD & TOBAGO, HONG KONG, HAITI, DOMINICAN REPUBLIC, GEORGIA, VIETNAM, HONG KONG

Countries where their products are under registration

BRAZIL, CAMBODIA, COSTA RICA, ECUADOR, ETHIOPIA, GHANA, GUATEMALA, KENYA, MALI, NIGERIA, TRINIDAD & TOBAGO, UKRAINE, UGANDA, TANZANIA, MOZAMBIQUE. YEMEN, OMAN, JORDAN, SYRIA, IRAQ, CHILE, VENEZUELA, MALDIVES,

IN INDIA

Klab has 1100 medical sales representatives with 195 first line managers and 51 second line managers.

This sales team meets 125,000 doctors and 75,000 pharmacies physically every month. Special focus is on Gastroenterologists, General Physicians, General Surgeons, Gynaecologists, Orthopedic Surgeons and Pediatricians. Klab s products are distributed nationally through 30 distributors, 1,000 stockiest and 75,000 pharmacies

Oncology Sales Force

Klab has 24 Specialty Sales Representatives who are only focusing on all the oncologists and oncology institutions within India

They have recently started focusing on the markets outside India.

They are exporting formulations to Ethiopia, Myanmar, Nigeria, Philippines, Sri Lanka, Thailand and Trinidad & Tobago.

Their products are under registration in Brazil, Cambodia, Costa Rica, Ecuador, Ethiopia, Dominican Republic, Georgia, Ghana, Guatemala, Haiti, Hong Kong, Kenya, Mali, Myanmar, Nigeria, Philippines, Sri Lanka, Thailand, Trinidad & Tobago, Ukraine, Vietnam, Yemen and Zambia.

They have supplies their Turnkey API Technology along with documentation to USA and Europe and are also supplying intermediates.

They are focusing on exporting Glycopyrrolate, Doxapram and Cyclophosphamide.

They are under negotiation with US Companies for conducting Clinical Trials in the field of Oncology in India.

They are supplying their niche Oncology Products to several countries as also are under negotiation to manufacture for overseas companies.

They have out licensed their Unique formulation NDDS products

namely :
Cefixime OD (once a day).
Oflaxacin OD (once a day).
Liposomal Doxorubicin (under negotiation)
Alendronate (once a week).
Methocarbamol Injection.
Anti-cancer range of products.

They are also negotiating New Chemical Entity Contract Research in Oncology. They are negotiating new arrangements for their new NDDS formulations for which they have applied for Product Patents.

Exports

PH     : (91) (22) 23724214
Email : export@khandelwallab.com

Human Resource

Email : hrd@khandelwallab.com

Marketing Domestic

Email : mktg@khandelwallab.com

CMT REPORT [Corruption, Money laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

6] Records on Int’l Anti-Money Laundering Laws/Standards :

Charges or investigation registered against subject: None

7] Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

8] Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

9] Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

CONTRAVENTION

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs. 45.92
UK Pound	1	Rs. 85.11
Euro	1	Rs. 58.08

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	5
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	5
--CREDIT LINES	1~10	5
--MARGINS	-5~5	-
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		46

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions