MIRA INFORM REPORT

Report Date :

23^rd June, 2006.

IDENTIFICATION DETAILS

Name :	TOTALFINAELF INDIA LIMITED
Formerly known as	ELF LUBRICANTS INDIA LIMITED
Registered Office :	3^rd Floor, The Leela Galleria, Andheri – Kurla Road, Andheri (East), Mumbai – 400 059, maharashtra, India
Country :	India
Financials (as on) :	31.03.2004
Date of Incorporation :	15.01.1993
Com. Reg. No.:	11-70410
CIN No.: [Company Identification No.]	U23201MH1993PTC070410
TAN No.: [Tax Deduction & Collection Account No.]	MUME01812G
PAN No.: [Permanent Account No.]	AAACE1877C
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturers, Importers and Exporters of Lubricants, Greases and related products using company’s technology and under company’s trademarks.

RATING & COMMENTS

MIRA’s Rating :

A

RATING		STATUS	PROPOSED CREDIT LINE
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

Maximum Credit Limit :	USD 1500000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Available information indicates high financial responsibility of the company. Trade relations are fair. Payments are correct and as per commitments. The company is expected to produce good results in days to come. It can be considered good for any normal business dealings.

LOCATIONS

Registered Office :	3^rd Floor, The Leela Galleria, Andheri – Kurla Road, Andheri (East), Mumbai – 400 059, maharashtra, India
Tel. No.:	91-22-56407700
Fax No.:	91-22-56407720
E-Mail :	mktho@elf.co.in
Website :	http://www.elf.co.in
Head Office :	1-02, Apple Heritage, 54-C, Sir M. V. Road, Andheri (West), Mumbai – 400093, Maharashtra, India
Tel. No.:	91-22-28311500/4
Fax No.:	91-22-28311520
E-Mail :	mktho@elf.co.in
Website :	http://www.elf.co.in
Area :	Owned
Factory 1 :	Plot No. 26, TTC Industrial Area, MIDC, Mahape, Navi Mumbai – 400 709, Maharashtra
Tel. No.:	91-22-27780673
Fax No.:	91-22-27780871

DIRECTORS

Name :	Mr. Nicholas J. Wellman
Designation :	Managing Director & Chief Executive Officer
Date of Birth:	01.06.1946
Date of Appointment:	01.10.2000
Address :	Malabar Court, 3^rd Floor, Ridge Road, Malabar Hill, Mumbai – 400006, Maharashtra, India
Name :	Mr. Anna Whitehouse
Designation :	Director (Foreign)
Address:	Singapore
Date of Birth:	22.02.1964
Date of Appointment:	28.09.2000
Name :	Mr. Nisel Pennington, British
Designation :	Director
Date of Birth:	27.12.1946
Date of Appointment:	28.09.2000
Ceasing Date:	24.09.2002
Address:	19, Bovlevard Pereire – 75017, Paris, France
Name :	Mr. Jean-Claude Breton
Designation :	Director
Date of Birth:	15.06.1943
Date of Appointment:	28.09.2000
Address:	5-B, Sunita Building, 5^th Floor, Ridge Road, Malabar Hill, Mumbai – 400 006, Maharashtra
Name :	Mr. Eudes Charpentier, Singapore
Designation :	Director
Date of Birth:	05.05.1967
Date of Appointment:	28.09.2000
Name :	Mr. Pierre – Yves Loisean
Designation :	Director
Date of Birth:	26.08.1959
Date of Appointment:	19.12.2001
Address	25, Rochalie Drive, Singapore – 248256
Name :	Mr. Maharydra B. Brahme
Designation :	Secretary
Date of Birth:	31.07.1962
Date of Appointment:	24.11.1994
Address:	Malad (West), Mumbai – 400064, Maharashtra, India
Name :	Mr. Christine Souchef
Designation :	Director
Date of Appointment:	24.09.2002
Address:	58, Avenue De Roule, 92 200 Nevilly 5/Seine, France
Name :	Herve Bourguignon, France
Designation :	Director
Date of Appointment:	21.07.1997
Date of Resignation:	28.09.2000
Name :	Mr. Eric Tersen, France
Designation :	Director
Date of Appointment	23.06.1999
Date of Resignation	28.09.2000
Name :	Mr. Philippe Mazenod
Designation :	Director (Foreign)
Address :	155, 4^th Main, Indiranagar, Bangalore, Karnataka
Date of Birth:	31.05.1965
Date of Appointment:	05.04.2002
Name :	Mr. Christine Souchet
Designation :	Director (Foreign)
Address :	58, Avenue Du Roule 92 200 Nevilly 5 Zeine, France
Date of Birth:	10.11.1959
Date of Appointment:	24.11.1994
Address :	France
Name :	Mr. Mahendra B Brahme, Mumbai
Designation :	Vice President – Finance & Company Secretary
Date of Birth :	31.07.1962
Date of Appointment:	24.11.1994
Name :	Mr. Eric Painvin, France
Designation :	Director
Date of Appointment:	15.01.1993
Date of Resignation:	28.09.2000
Name :	Mr. Homi Patel
Designation :	Vice Chairman
Name :	Mr. Thierry Gautier
Designation :	Chief Executive Officer and Managing Director
Date of Birth :	15.06.1963
Date of Appointment:	11.07.2003
Address :	Mumbai – 400 018, Maharashtra, India
Name :	Mr. Dilip Vaswani
Designation :	Executive Director
Name :	Pascal Renard
Designation :	Director
Name :	Boman Mirza
Designation :	Director

MAJOR SHAREHOLDERS

Names of Shareholders	No. of Shares
Total Fina Elf France (France)	16260673
Total Fina Elf France (Nominee M. B. Brahme)	1
Total Fina Elf France (Nominee Christine Souchet)	1
Total Fina Elf France (Nominee Anna Whitehouse)	1
Total Fina Elf France (Nominee Jacaques)	1
Total Fina Elf France (Nominee Phillippne Mazenod)	1
Total Fina Elf France (Nominee Thierry-Jean Gautier)	1

BUSINESS DETAILS

Line of Business :	Manufacturers, Importers and Exporters of Lubricants, Greases and related products using company’s technology and under company’s trademarks.
Products :	Ø Lubricating Oils Ø Grease Ø Traded Items

PRODUCTION STATUS

Particulars	Unit	Actual Production
Lubricants Oils of various grades - Processed at its own plant - Processed by third party	MT	30803 5473
Greases of various grades - Processed by third party	MT	3114

GENERAL INFORMATION

No. of Employees :	250
Bankers :	Ø Credit Agricole Indosuez Ø State Bank of India, Fort Branch, Mumbai – 400 001, Maharashtra Ø Societe Generale, Mumbai – 400 021, Maharashtra Ø HSBC Ø Bank of Baroda Ø Banque Indo Suez
Banking Relations :	Good
Auditors :	Bharat S. Raut & Company Chartered Accountants KMPG House, Kamala Mills Compound, 448, Senapati Bapat Marg, Lower Parel, Mumbai – 400 013, Maharashtra
Tel. No.:	91-22-24913030
Sister concern :	Ø Raysif India Limited, Mumbai. Ø REPL Engineering Limited
Subsidiaries :	Ø Total Fina Elf Lubricants S.A. Ø Total Raffinage Distribution S.A. Ø Atofina Ø ELF Oil Belgium S.A. Ø Total Lubricants Japan Ø Total Belgium S.A. Ø Total Lubricants Taiwan Limited Ø Total France Ø Total Lubricants International Ø Total Cambodia Ø Total ISY Oil Company Limited Ø ELF Lubricants (Guangzheu) Company Limited Ø G. I. E. Ø Total Petroleum India Private Limited
Holding Companies :	Total France Ultimate Holding Company Total S.A.

CAPITAL STRUCTURE

Authorised Capital:

No. of Shares	Type	Value	Amount
2,00,00,000	Equity Shares	Rs.10/- each	Rs.200.000 millions

Issued, Subscribed & Paid-up Capital:

No. of Shares	Type	Value	Amount
1,62,60,679	Equity Shares	Rs.10/- each	Rs.162.606 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.12.2004	31.12.2003	31.12.2002
SHAREHOLDERS FUNDS
1] Share Capital	162.606	162.606	162.607
2] Reserves & Surplus	248.547	187.648	131.292
NETWORTH	411.153	350.254	293.899
LOAN FUNDS
1] Secured Loans	21.884	5.287	80.252
2] Unsecured Loans	11.987	156.983	160.562
TOTAL BORROWING	33.871	162.270	240.814
TOTAL	445.024	512.524	534.713
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]	127.282	144.455	160.105
Capital work-in-progress	5.481	8.186	0.225
INVESTMENTS	0.000	0.000	0.000
DEFERRED TAX ASSETS	17.909	17.730	0.000
CURRENT ASSETS, LOANS & ADVANCES
Inventories	569.655	375.957	380.801
Sundry Debtors	128.954	92.464	158.021
Cash & Bank Balances	106.950	116.680	198.290
Other Current Assets	0.000	0.000	0.000
Loans & Advances	100.364	75.153	110.899
Total Current Assets	905.923	660.254	848.011
Less: CURRENT LIABILITIES & PROVISIONS
Current Liabilities & Provisions	611.571	318.101	473.640
Total Current Liabilities	611.571	318.101	473.640
Net Current Assets	294.352	342.153	374.371
MISCELLANEOUS EXPENSES	0.000	0.000	0.012
TOTAL	445.024	512.524	534.713

PROFIT & LOSS ACCOUNT

PARTICULARS	31.12.2004	31.12.2003	31.12.2002
Sales Turnover [including other income]	2275.408	1966.220	1799.923
Profit/(Loss) Before Tax	200.874	138.580	59.587
Provision for Taxation	75.625	51.756	0.432
Profit/(Loss) After Tax	125.249	86.824	59.155
Export Value	28.117	NA	NA
Import Value	988.432	688.871	540.600
Total Expenditure	2093.388	1827.640	1830.829

KEY RATIOS

PARTICULARS		31.12.2004	31.12.2003	31.12.2002
PAT / Total Income	(%)	5.50	4.41	3.28
Net Profit Margin (PBT/Sales)	(%)	8.83	7.05	3.31
Return on Total Assets (PBT/Total Assets}	(%)	19.01	16.68	5.90
Return on Investment (ROI) (PBT/Networth)		0.49	0.39	0.20
Debt Equity Ratio (Total Liability/Networth)		2.57	2.37	2.43
Current Ratio (Current Asset/Current Liability)		1.48	2.07	1.79

LOCAL AGENCY FURTHER INFORMATION

The company operates in collaboration with ELF Lubricants S.A.

The company’s fixed assets of important value include leasehold improvements, building and leasehold land, plant and machinery, furniture and fixtures, computers, office equipment and vehicles.

History

The company was a 51:49 Joint Venture between ELF Lubricants S.A, France and company incorporated in France and Raysif India Limited. In 1999 the company became a 100% subsidiary of ELF, France. During the year ELF, France sold its investment in the company to DAJA 20, till 20^th December 2002, which was a subsidiary of Total Fina ELF, S.A. France on 20^th December 2002, Daja 20 sold its stake in the company to Total Fina ELF, France. Total Fina Elf, France is a wholly owned subsidiary of Total Fina Elf, USA, the ultimate holding company.

Consequent to the worldwide merger of Totalfina S.A., France & ELF Aquitaine S.A., France the local management has decided to demerge the lubricating oils and grease business of Total Petroleum India Private Limited into the company.

The company changed its name to the present w.e.f. 1^st January, 2003.

Press clippings

Kochi (Kerala) April 20, 2004

Total Fina Elf India, one of the leading companies in the lubricants segment in the country, has adopted an approach of focus and penetration to increase its share in the market.

The target is to achieve a 25% growth with an aim to increase the market share to three per cent from the present 1.4% by 2006.

The company will be focussing primarily on the commercial vehicle and tractor segment in the bazaar trade, Mr R. Ramesh, Assistant Vice-President (South), Lubricants Division, said at a press conference.

As far as Kerala is concerned, the company is aiming to achieve a growth of 30 per cent in volumes and 20 per cent in the secondary network this year, he added.

Mr. Ramesh was here in connection with the change of company’s logo in compliance with the global strategy. The new logo has been designed keeping in mind the company’s global strengths and its vision, he said.

It is déjà vu for the Indian oil industry. Ten years ago, the skyline was crowded with such names as Caltex, Mobil, Gulf, Shell and Idemitsu flashing their lubricants and engine oil brands. India had welcomed the world, albeit with the doors half-open.

The story of Elf Lubricants India Ltd began then. A decade later the doors of the Indian oil sector seemed to open a little more. However, the enthusiasm has turned to cautious scepticism as many of the 35-odd players who had plunged into the Indian lubes market vanished.

The world's fourth largest oil company is also watching the goings-on with caution and hope. The company made a quiet entry into the Indian market with its offering of lubricants, LPG and chemicals in 1992-93. The company, which has maintained a low profile in India, recently completed a successful international merger.

Business Line spoke to two of the company's top officials — Mr P. K. Mittal, Vice-President (Sales) and Mr Sanjoy K. Guha, Assistant Vice-President (Marketing), about TotalFinaElf's lubes business and future plans.

"After the recent global merger of TotalFina and Elf, the company's Elf and Total brands together hold about 9% in the bazaar segment of India's lubes market," says Mr Guha.

Thanks to India's closed market, the presence of non-public sector oil companies has so far been restricted to the `bazaar' or unorganised sector comprising of spare part shops, hardware dealers and garages.

TotalFina, like its other private sector competitors, has learnt that a strong dealer network parallel to the PSU retail outlets is essential for survival in the Indian lubes market.

According to the officials, the company has set up a combined network of Total and Elf lubes and grease oils comprising over 70 depots with 500 distributors and 21,000 dealers across five distribution zones in the country.

"They had set targets of establishing at least one dealer in every important town and city in every state," says Mr Mittal.

Adds Mr. Guha, "This strategy was unlike that of other oil companies which have traditionally focussed on `high value' areas such as the urban market. But we decided to follow a strategy of slow and quiet building of the Elf brand through smaller towns and interior parts of the country."

The company seems to have worked against the tide by ignoring most of the established protocols in the lubes business. Targeting rural customers was one such divergence.

The result — Elf is a popular name with most tractor and pumpset owners with brands such as Elf Super HD5 and Elf Tractor HDC being introduced in the rural and semi-urban markets.

"They were the first to supply lubricants for wet brakes in tractors," says Mr Mittal. "Today most tractor owners prefer oils."

The company has original equipment manufacturing contracts with Mahindra and Mahindra Ltd which accounts for two-thirds of India's tractor sales. Another alliance is with the multinational tractor manufacturer New Holland, which recently entered the Indian market. While most lubes companies have chosen to enter numerous OEM contracts, Elf claims to have chosen the "few but the best" of the lot.

The company has alliances with General Motors for its Opel brand of luxury cars while Volvo is the chosen partner in the trucks segment. "We were among the first to introduce Elf Moto 4, a special engine oil for four-stroke motorcycles in the Indian market. Others only followed suit later," says Mr Guha. The product was endorsed by bike manufacturers that included Hero Honda, Kawasaki Bajaj and Enfield.

Another broken convention has been the lack of hype surrounding the brand.

Compared to brands such as Indian Oil Corporation's Servo, Hindustan Petroleum, Bharat Petroleum and private sector major Castrol which are competing for the viewer's attention, Elf has chosen to shy away from making claiming its place on TV prime time or in-the-face highway hoardings despite deep pockets of the mother company.

However, both officials agree that the long drawn, and complex, process of the international merger of company and Elf has been one of the reasons for the low public profile.

"They had been going about our business without succumbing to the pressure of building hype around name. Besides, there was little logic in spending unreasonably large sums on advertising. We chose to spend the effort on speaking directly to our customers... although we must admit we are making an effort to improve our visibility," says Mr Mittal.

And the future is bright. Both officials nod their heads in complete agreement. "We are here to stay. After the completion of the merger, we have a lot to build on," says Mr Guha.

Although there is a certain degree of scepticism about the speed of reforms, the focus on improving the lubes business is as sharp as ever.

And what happens to the market after the recent opening up of the retail sector?

"Well, a few more competitors in the lubes basket," says a matter-of-fact Mr Guha. He is quick to remind one of how the Indian lubes market saw enough competition in 1992-93, when the Indian consumer saw more than 30 brands from every corner of the globe competing for his attention. Nine years on, that number has dropped to less than half.

But decontrol reforms could result in another fallout. "Prices of lubricants and oils may improve," according to Mr Mittal.

"With new players entering retail, the assured returns to PSUs from diesel and petrol sales may come down. This would mean `real' competition in the lubes market bringing `real' prices in the open. The incidence of curbing competition through price undercutting may reduce as players will be unable to subsidise lubes products with profits on other retail products," says Mr Mittal.

Mr. Guha concurred: "Competition will be tougher. With most Government reforms aiming at improving the life of vehicles and research churning out longer-lasting oils, sales could dip. But the renewed highway development plans will also mean more vehicles on the roads."

The only other worry is the slow pace of growth of the Indian lubricants market. The market has remained stagnant at one million tonnes.

"Yes, the market does increase mildly to 1.2 million tonnes sometimes, but the growth in a market such as India deserves to be much higher. The year 2000 even saw a negative growth rate," says a concerned Mr Mittal. But there is hope.

"They find this market interesting, complex and highly competitive. And yes, we are here for a long time to come," he says with a smile.

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 records 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.46.20
UK Pound	1	Rs.84.57
Euro	1	Rs.58.12

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