MIRA INFORM REPORT

Report Date :

13^th May, 2006

IDENTIFICATION DETAILS

Name :	BAERLOCHER INDIA ADDITIVES PRIVATE LIMITED
Registered Office :	Godrej Industries Complex, Pirojshanagar, Vikhroli (East), Mumbai – 400079, Maharashtra
Country :	India
Financials (as on) :	31.03.2005
Date of Incorporation :	21^st March, 2002
CIN No.:	U74999MH2002PTC112261
Com. Reg. No.:	11-22161
TAN No.: (Tax Deduction & Collection Account No.)	MUMB07662E
PAN No.: (Permanent Account No.)	AAACB6493M
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacturer of Compound Stabilisers for Resins and Plastics

RATING & COMMENTS

MIRA’s Rating :

B

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small

Maximum Credit Limit :
Status :	Moderate
Payment Behaviour :	Slow but Correct
Litigation :	Clear
Comments :	Subject is a subsidiary of an Italian company having moderate track. Directors are reported as experienced and respectable businessmen. Trade relations are reported as fair. Company’s profitability is under severe pressure. It has some accumulated losses. Payments are reported as slow but correct. The company can be considered for small business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	Godrej Industries Complex, Pirojshanagar, Vikhroli (East), Mumbai – 400079, Maharashtra
Tel. No.:	91-22-55974151/52
Fax No.:	91-22-25188703
E-Mail :	admin@baerlocherindia.com
Website :	http://www.baerlocher.de/de
Factory 1 :	Industrial Area No. 3, A B Road, Dewas (Madhya Pradesh) – 455001
Tel. No.:	91-72-72509700
Fax No.:	91-72-72509727

DIRECTORS

Name :	Mr. Ahluwalia S Surinder
Designation :	Manger
Address :	Flat No. 12, LE Chateau, 15^th Road, Bandra (West), Mumbai – 400050
Date of Birth/Age :	22^nd April, 1941
Date of Appointment :	4^th December, 19997
Name :	Mr. Grasnueck C Rainer
Designation :	Director
Address :	Vilale Placenza Lodi - 5026900, Italy
Date of Birth/Age :	5^th May, 1957
Date of Appointment :	10^th December, 19997
Name :	Mr. Comini Emilio Andrea
Designation :	Director
Address :	Viale Sardegna, Pavia – 9827100, Italy
Date of Birth/Age :	31^st October, 1950
Date of Appointment :	30^th March, 1999
Name :	Mr. Dehh Dieter Klavs
Designation :	Director
Address :	Kazairstrasse, Munich – 43-80339, Germany
Date of Birth/Age :	5^th November, 1955
Date of Appointment :	23^rd March, 2005
Name :	Mr. Fischer R Bernhard
Designation :	Director
Address :	Waldpro Menade, Munich – 1382131, Germany
Date of Birth/Age :	30^th January, 1949
Date of Appointment :	4^th December, 1997

Name :	Mr. Cheng K Malpaso
Designation :	Director
Address :	332 Upper East Coast Road, The Tlopics Garden, Singapore
Date of Birth/Age :	24^th January, 1949
Date of Appointment :	4^th December, 1997
Name :	Mr. Ausserbauer Valentin
Designation :	Director
Address :	Tiefer Weg, Lingen – 49808, Germany
Date of Birth/Age :	19^th September, 1939
Date of Appointment :	10^th December, 1997
Name :	Mr. Patnaik Kumar Sankar
Designation :	Director
Address :	Flat No. 1, ‘B’ Block, Shiv Shankar Aqart, Jui Nagar, Navi Mumbai – 400706
Date of Birth/Age :	29^th May, 1971
Date of Appointment :	18^th November, 2002

MAJOR SHAREHOLDERS

Names of Shareholders	No. of Shares
Baerlocher Italia SPA	22031959
Baerlocher GMBH	1

BUSINESS DETAILS

Line of Business :	Manufacturer of Compound Stabilisers for Resins and Plastics
Products :	Compound Stabilisers for Resins and Plastics – 3812.00

PRODUCTION STATUS

Particulars	Unit	Installed Capacity	Actual Production
Compound Stabilisers for Resins and Plastics	M.T.	11500 Per Annum	4097

GENERAL INFORMATION

Bankers :	Bank of Baroda, Bhatkopar (West) Branch, Mumbai – 400086
Facilities :	Unsecured Loan From Bank Short Term Loan from Calyon Bank – 70.000 Millions Cash Credit Facility from IDBI Bank – 5.797 Millions Interest Accured & Due on loans – Rs. 0.025 Milions Total – Rs. 75.823 Millions

Banking Relations :	Satisfactory
Auditors :	C C Chokshi & Company Chartered Accountant
Address:	13, Dr. Annie Besant Road, Opposite Shiv Sagar Estate, Worli, Mumbai – 400018
Tel. No.:	91-22-56679000
Fax No.:	91-22-56679025
Associates/Subsidiaries :	v Baerlocher GmbH v Baerlocher Italia v Baerlocher Fareast Private Limited v Baerlocher UK

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
25,000,000	Equity Shares	Rs. 10/- Each	Rs. 25.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
22,031,960	Equity Shares	Rs. 10/- Each	Rs. 220.319 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		220.319	220.319	220.319
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		0.000	0.000	0.000
4] (Accumulated Losses)		(87.783)	(88.367)	(79.198)
NETWORTH		132.536	131.952	141.121
LOAN FUNDS
1] Secured Loans		0.000	0.000	0.000
2] Unsecured Loans		75.823	88.068	76.706
TOTAL BORROWING		75.823	88.068	76.706
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		208.359	220.020	217.827
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		96.236	105.946	123.722
Capital work-in-progress		0.000	0.096	0.000
INVESTMENT
DEFERREX TAX ASSETS
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	59.682	63.232	46.013
	Sundry Debtors	62.758	60.844	52.201
	Cash & Bank Balances	2.395	1.061	2.531
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	15.894	13.666	11.100
Total Current Assets		140.729	138.803	111.845
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	27.479	23.802	16.748
	Provisions	1.127	1.023	0.992
Total Current Liabilities		28.606	24.825	17.740
Net Current Assets		112.123	113.978	94.105
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		208.359	220.020	217.827

PROFIT & LOSS ACCOUNT

PARTICULARS	31.03.2005	31.03.2004	31.03.2003
Sales Turnover [including other income]	278.026	288.490	235.989
Profit/(Loss) Before Tax	0.585	(9.169)	(27.586)
Provision for Taxation	0.000	0.000	0.000
Profit/(Loss) After Tax	0.585	(9.169)	(27.586)
Export Value	2.606	0.841	NA
Import Value	8.996	12.599	NA
Total Expenditure	277.441	297.658	263.575

KEY RATIOS

PARTICULARS		31.03.2005	31.03.2004	31.03.2003
PAT / Total Income	(%)	0.21	(3.17)	(11.68)
Net Profit Margin (PBT/Sales)	(%)	0.21	(3.17)	(11.68)
Return on Total Assets (PBT/Total Assets}	(%)	0.24	(3.74)	(11.71)
Return on Investment (ROI) (PBT/Networth)		--	(0.06)	(0.19)
Debt Equity Ratio (Total Liability/Networth)		0.78	0.85	0.66
Current Ratio (Current Asset/Current Liability)		4.91	5.59	6.30

LOCAL AGENCY FURTHER INFORMATION

Review Operation

During the year the company sold 4.145 MT of plastic stabilizers as compared to previous year sales of 5.000 M.T. The production during the year is 4.097 MT of plastic stabilizers as compared to 5,088 MT in pervious year. However due to improved margine realized during the year. The company has for first time earned a net profit after tax of Rs. 0.585 Millions the director expect further improvement in such margin during the current year.

Research and Development [R & D]

The company has no plans to undertake separate Research and Development in India as these facilities are available with group companies and the benefits of any relevant new development will be available to the company

Technology Absorption, Adaptation and Innovation

New grades like 1102,6020,7060 and UBZ 670 were developed as per market requirement

Fixed Assets:

v Leasehold Land

v Factory Building

v Plant & Machinery

v Office Equipment

v Computer

v Furniture & Fixture

v Motor

Use of Estimates

The preparetion of financial statement in conformity with the generally accepted accounting principal requires estimates and assumption to be made that affect the reported amount of assts and liability. Actual results may differ from the estimates used in preparing the accompanying

Retirement Benefits

Contribution made to provide fund and superannuating fund are charged to revenue

Gratuity is charged to revenue on the basis of actuarial valution under Group

Leave encashment benefit to eligible employees is provide on the basis of the balance unveiled leave to the credit of employs

Treatment of Contingent Liability

Contingent liabilities if any disclosed by way of notes in the balance sheet. Provision is made in account for those liabilities which are likely to materializes after the year end and having effect on the position stated in the balance sheet as the year ended

Name of the company	BAERLOCHER INDIA ADDITIVES PRIVATE LIMITED
Presented By	Bank of Baroda
1) Date and description of instrument creating the change	Hypothecation agreement dated 23td February, 2001
2) Amount secured by the charge/amount owing on the securities of charge	Rs. 60.000 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	The whole of the borrowers stocks both present and future and including but without prejudice to the generality of the foregoing words all stocks of raw materials, work in progress, semi finished goods such as load stearic acid, cadimium oxide, MTO, PVC Stabilizers etc, Packing materials and stores etc. Whatsoever situed and in transite whether now belonging to or that may at any time during the continuance of this security All the present and future book – debts outstanding monies receivable, claims, bills, contact engagement and securities which are now due and owing or which may at any time the borrower in the course of its business by any person, firm company or body. State Government or Indian Railway or Office or any Municipal or local or public or semi government or given on hire purchase basis
4) Gist of the terms and conditions and extent and operation of the charge.	The charge is created to secure following credit facilities together with interest and margin as stated below Cash Credit – 1% Over PLR 25% (hypothecation of 12% Stock & Book – Effective rate – Rs. 45.000 Millions of Interest 13% with quarterly Inland Import - 25% L/C (D/P, D/A upto 90 days) Rs. 5.000 Millions Bank Grantee – 25% Rs. 10.000 Millions
5) Name and Address and description of the person entitled to the charge.	Bank of Baroda, Bhatkopar (West) Branch, Mumbai – 400086
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	BAERLOCHER INDIA ADDITIVES PRIVATE LIMITED
Presented By	Bank of Baroda
1) Date and description of instrument creating the change	Hypothecation agreement dated 23td February, 2001
2) Amount secured by the charge/amount owing on the securities of charge	Rs. 60.000 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	The whole of the borrowers stocks both present and future and including but without prejudice to the generality of the foregoing words all stocks of raw materials, work in progress, semi finished goods such as load stearic acid, cadimium oxide, MTO, PVC Stabilizers etc, Packing materials and stores etc. Whatsoever situed and in transite whether now belonging to or that may at any time during the continuance of this security All the present and future book – debts outstanding monies receivable, claims, bills, contact engagement and securities which are now due and owing or which may at any time the borrower in the course of its business by any person, firm company or body. State Government or Indian Railway or Office or any Municipal or local or public or semi government or given on hire purchase basis
4) Gist of the terms and conditions and extent and operation of the charge.	The charge is created to secure following credit facilities together with interest and margin as stated below Cash Credit – 1% Over PLR 25% (hypothecation of 12% Stock & Book – Effective rate – Rs. 45.000 Millions of Interest 13% with quarterly Inland Import - 25% L/C (D/P, D/A upto 90 days) Rs. 5.000 Millions Bank Grantee – 25% Rs. 10.000 Millions
5) Name and Address and description of the person entitled to the charge.	Bank of Baroda, Bhatkopar (West) Branch, Mumbai – 400086
6) Date and brief description of instrument modifying the charge	Hypothecation agreement dated 27^th March, 2001
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 charged is increased from Rs. 60.000 Millions to Rs. 70.000 Millions the cash credit facility is increased from Rs. 45.000 Millions to Rs. 70.000 Millions

As per Website Details:

About Us

Global partner for additives

The Baerlocher group of companies is one of the world's leading additive suppliers, drawing on its experience from more than 175 years of company history. Their expertise in the production and use of plastic additives is closely linked to the success story of plastic materials. Their global presence and more than 800 employees around the world make sure they stay close to their customers. 13 production sites in Germany, Italy, France, Great Britain, the United States, Brazil, Argentina, Peru, India, Korea and Malaysia as well as a sales network covering more than 40 countries make us a strong partner.

Vision

Plastics create new solutions for the future. Additives play a crucial role in determining processing properties and product quality.  By developing and manufacturing high-quality, innovative plastic additives, Baerlocher supports the plastics industry all over the world and thus contributes to the success of its customers.

Sustainability

Responsible care
People are part of an environment that has to safeguard ecosystems for future generations and provide smart technologies and products. A task they can only carry out together: an awareness of and sense of responsibility for sustained development therefore play an important role in all decision-making processes.

Environmental protection and safety
They are committed to the principles of responsible care: sustainable development, safe and environmentally friendly production processes as well as protection of people and the environment are therefore key corporate goals. Their quality management system with ISO 9001 certification and their environmental management system with ISO 14001 certification encourage all employees to act responsibly in order to achieve joint success with their customers. They also provide proactive support for voluntary industry commitments such as Vinyl 2010 and the replacement of Pb stabilizers.

Research and Development

Comprehensive know-how about the production and use of plastics additives and the development of new additive systems are what make Baerlocher stand out as a research-orientated enterprise with strong creative potential. Continuous investment in research and development and a large number of research scientists and technical experts are the source of their innovative skills. Baerlocher has R&D sites in Germany (München-Unterschleissheim), France (Marseille), Italy (Lodi), the United States (Dover, Ohio) and India (Mumbai).

Organization

Global Management Committee (GMC)	Responsibility
Dr. Felix K. Meyer	Chief Executive Officer MD Baerlocher GmbH
Klaus Walter	MD Baerlocher GmbH
Arne Schulle	Chief Financial Officer
Hans Jürgen Sander	Head of Business Unit PVC Solid Additives
Rainer Grasmück	Head of Business Unit PVC Liquid Addititves
Andreas Holzner	Head of Business Unit Special Addititves
Bernhard Fischer	General Counsel

History - more than 175 years

2004

• Dr. Michael Rosenthal, Majority Shareholder of Baerlocher, retires
  from operations and becomes Chairman of the Board.
• Dr. Felix Meyer takes over operational management of the Baerlocher
  Group of companies as Chief Executive Officer.

1998

• Headquarters move from Munich to Unterschleissheim
• Inauguration Plastics Additive Museum in Lingen
• 175 year anniversary

1980

Dr. Michael Rosenthal takes over direction of the business

1947

Takeover of plants by Dr. Christian Rosenthal Products

Products
Baeropan®		customer-specific additive one-packs for PVC
Baerostab®		high performance PVC stabilizers
Baerolub®		lubricants
Baerorapid®		processing aids on acrylate basis
Baerodur®		impact modifiers on acrylate basis
Baeropol®		customer specific additive blends for Polyolefins, Polystyrene, engineering plastics and rubbers
Baerophob®		Hydrophobic agents
Baerocid®		Stearic acid
Baerocin®		Glycerine
Zincum®, Ceasit®		Calcium-, Zinc-, Aluminium-, Lithium-, Sodium-, Magnesium- stearates and oleates
Alugel®		Thixotropic agents

Industries + Applications

The Baerlocher group of companies has an outsatnding reputation in the plastic and especially PVC industriy. Thanks to the distinct sense for innovation, Baerlocher provides its customers around the world with tailor-made stabilisers and additives for plastics processing.

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.45.39
UK Pound	1	Rs.85.88
Euro	1	Rs.58.55

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	3
PAID-UP CAPITAL	1~10	4
OPERATING SCALE	1~10	3
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	5
--PROFITABILIRY	1~10	2
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	3
--CREDIT LINES	1~10	3
--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		33

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		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