MIRA INFORM REPORT

Report Date :

7^th April, 2007.

IDENTIFICATION DETAILS

Name :	SPICER INDIA LIMITED
Registered Office :	29, Milestone, Pune Nashik Highway, Village Kuruli Taluka Khed, Pune – 410501, Maharashtra, India.
Country :	India
Financials (as on) :	31/03/2004
Date of Incorporation :	29^th July, 1993.
Com. Reg. No.:	11-73227
TAN No.: (Tax Deduction & Collection Account No.)	PNES11424A
PAN No.: (Permanent Account No.)	AAECS1869C
Legal Form :	It is a closely held public limited liability company.
Line of Business :	Designing, Manufacturing, Assembling, Contract for Buying, Selling, Hiring, Exporting, Importing, Distributing and Dealing in all types of universal joints, axles, transfer cases, drive shafts and components thereof for automotive applications whether in finished or semi-finished forms.

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 3000000
Status :	Satisfactory
Payment Behaviour :	Regularly
Litigation :	Clear
Comments :	Subject is a well established company having fine track records. Available information indicates high financial responsibility of company. Their trade relations are fair. Payments are usually correct and as per commitment, The company can be considered good for any normal business dealing at usual trade terms and conditions. It can be regarded as a promising business partner in a medium to long-run.

LOCATIONS

Registered Office :	29, Milestone, Pune - Nashik Highway, Village Kuruli, Taluka Khed, Pune - 410 501, Maharashtra, India.
Tel. No.:	91-20-24102501/ 02 / 03/ 04 / 05
Fax No.:	91-2135-252229/24120516
E-Mail :	shrikantchoudhary@dana.com subhashgupta@dana.com
Website :	http://www.dana.com
Factories :	Ø Village, Jodalli, Taluka Kalghatgi, District Dharwad, Jodalli - 580 114, Karnataka Tel. No. 91-836-2310482/3 Fax. No. 91-836-2310481 Ø Plot 144, Sipcot Industrial Comples, Phase – I, Hosur -635126, Tamilnadu Tel. No. 91-4344-277026 Fax. No. 91-4344-277803 Ø Gat No. 74/A, Tulja Bhavani Industrial Estate, Near to Additional M. I. D. C. Karandwadi, Satara –415004, Maharashtra Tel. No. 91-2162-246503/4/6 Fax. No. 91-2162-246505 Ø 622-626, Kuruli - 410 501, Chakan, Pune, Maharashtra Tel. No. 91-2135-252228

DIRECTORS

Name :	Mr. Deepak Chand Anand
Designation :	Chairman
Address :	1, Sri Aurobindo Marg, Hauz Khas, New Delhi - 110 016
Date of Birth/Age :	26/08/1933
Date of Appointment :	29/07/1993
Name :	Mr. Chandrakant S. Patel
Designation :	Managing Director
Address :	A-1, Srirang Heavens, Pimplesh Saudagar Road, Anudh Camp, Pune - 411 027, Maharashtra
Date of Birth/Age :	1/09/1939
Date of Appointment :	20/01/2001
PROFILE	Mr. C. S. Patel has a MS in Industrial Engineering from University of Minnesola and a MBA from the University of Detroit. He served with Ford Motor Company, USA for a period of five years before returning to India. Mr. Patel has held several assignments of increasing responsibility in Anand Group since 1974 especially as President of Human Resources and Business Development. Mr. Patel has spearheaded the operations of Spicer India Limited as Managing Director and greenfielded Driveshaft factories and Axle Plant. Presently, he is Chief Operating Officer of Anand Group
Name :	Mr. Ismeal Jose Melgar
Designation :	Director
Address :	8917, Oak Valley Road, Holland, Ohio, USA - 43528
Date of Birth/Age :	12/07/1942
Date of Appointment :	29/06/2002
Name :	Mr. Mahindra Kumar Kukreja
Designation :	Director
Address :	9, Sadhana Enclave, New Delhi -110 017
Date of Birth/Age :	22/12/1931
Date of Appointment :	26/08/2001
Name :	Mr. Michael F. Greene
Designation :	Director
Address :	4500, Door Street, Toledo, Ohio, USA
Date of Birth/Age :	20/11/1948
Date of Appointment :	26/08/2001
Name :	Mr. Krishnamurthy Naga Subramainam
Designation :	Director
Address :	13-14, Anfilco Colony, 25.3 Km, Palam - Gurgaon Road, Dundhara, Gurgaon, Haryana - 122001
Date of Birth/Age :	15/07/1953
Date of Appointment :	05/06/2001
Name :	Mr. Karl Alfred Nitsch
Designation :	Director
Address :	Dena Europe, LA, Pierriere, CH-1029, Villars - STC - Croix
Date of Birth/Age :	15/01/1951
Date of Appointment :	29/06/2002
Name :	Mr. Joseph Stanley Sober
Designation :	Director
Address :	4536, Wind River Door, Sylvania, Ohio, USA - 43560
Date of Appointment :	05/06/2001
Name :	Mr. Dennis John Greenwald
Designation :	Director
Address :	3475, Shadywood Road, Lambert Ville, Michigan, USA - 48144
Date of Birth/Age :	31/01/1947
Date of Appointment :	05/06/2001
Name :	Mr. Deepak Chopra
Designation :	Director
Address :	Anfilco Colony, 25.3 Km, Palam - Gurgaon Road, Dundhara, Gurgaon, Haryana - 122001
Date of Birth/Age :	15/12/1954
Date of Appointment :	05/06/2001
Name :	Mr. Erine Johnson
Designation :	Director
Address :	Wingarte, Orchard, 25.3 Km. Palem – Gurgaon Road, Dundhara, Gurgaon, Haryana – 122001
Date of Birth/Age :	14/03/1952
Date of Appointment :	30/06/2003
Name :	Mr. Cornelia Langenstadt Vonkeunsberg
Designation :	Director
Address :	Avenue de la Care, 84B, 1022, Chavannes, Switzerland
Date of Birth/Age :	18/03/1965
Date of Appointment :	25/07/2003

KEY EXECUTIVES

Name :	Mr. Manish Kumar Baid
Designation :	Company Secretary
Address :	FF2, Gayatri Apartments, Sadar Bazar, Satara – 415002, Maharashtra
Date of Appointment :	30/06/2003

MAJOR SHAREHOLDERS

Category	% of shares
Foreign Holdings	74.90
Bodies Corporate	25.10

Break up is as under :

Name of Shareholders	No of Shares
Dana Corporation Door Street, Ohio, USA - 43697	81416300
Anand Technology Resource Park Private Limited 86/1, Kumbalgod Industrial Area, Phase - II, Bangalore, Karnataka - 560074	6133491
Asia Investments Limited 1, Sri Aurobindo Marg, Hauz Khas, New Delhi - 110016	10030205
Perfect Circle Victor Limited 20, MIDC Area, Satpur, Nashik - 422007, Maharashtra	11120000
Mr. Pravesh Kumar Srivastava 33, Beuna Monte, NCL chs, Pashan Road, Pune- 411 008, Maharashtra	1
Mr. Chandrakant S. Patel A-1, Srirang Heavens, Pimplesh Saudagar Road, Pune - 411021, Maharashtra	1
Mr. Subhash C. Gupta 47/1, Ramnagar Colony, Pashan Road, Pune - 411 021, Maharashtra	1
Mr. Deepak Chopra 1, Sri Aurobindo Marg, Hauz Khas, New Delhi - 110 016	1

BUSINESS DETAILS

Line of Business :

Designing, Manufacturing, Assembling, Contract for Buying, Selling, Hiring, Exporting, Importing, Distributing and Dealing in all types of universal joints, axles, transfer cases, drive shafts and components thereof for automotive applications whether in finished or semi-finished forms.

PRODUCTION STATUS

Particulars	Installed Capacity (in nos. per annum)	Actual Production (in nos.)
Yokes	600000	651544
Companion Flange	18000	80739
V J Kits	600000	171560
Propeller Shaft Assembly	120000	316194
Axles	100000	36744

GENERAL INFORMATION

Suppliers :

Ø Naveen Engineering

Ø Amba Engineering Work

Ø Vijaylaxmi Gears

Ø Shardha Tools & Dies

Ø Avi Auto Riders Private Limited

Ø Mantri Metalics Limited

Ø Phoenix Sheet Converters

Ø Siddhi Forge Limited

Ø Water Treatment Services

Ø Surnedra Forgings Limited

Ø Wire Rings

Ø Akshay Pressings

No. of Employees :

2000

Bankers :

Bankers	Facility	Limit enjoyed in millions
Deutshe Bank	Term Loan (Hypothecation of Plant and machinery and other movable assets)	210.00
	Overdraft/Short Term Loan (Hypothecation of inventory, book debts and other movable assets at all locations)	80.00
	Export Bill Purchased	30.00
	Letter of Credit	40.00
	Custom / Excise Guarantee	30.00
Bank of Nova Scotia Mittal Towers, 'B' Wing, Nariman Point, Mumbai - 400 021, Maharashtra	Over Draft (pari-passue charge on stock and book - debts)	50.00
Standard Charted Grindlays Bank Limited	Term Loan	1000.00
	Over Draft	50.00

Banking Relations :	Satisfactory
Auditors :	Price Waterhouse Chartered Accountants
Address:	1102/1107, Raheja Chambers, Nariman Point, Mumbai - 400 021, Maharashtra
Tel. No.:	91-22-22825242/22834646
Fax No.:	91-22-22045592/22824022
Associates/Subsidiaries :	Ø ROC Keeper, Taiwan Ø Dana Global Logistics Limited Ø Dana Spicer (Thailand) Limited Ø Dana Italia SPA Ø Dana Spicer Europe Limited Ø Dana Spicer Axle Carden SA Ø Dana India Private Limited Ø Spicer UK Ø Spicer France Ø Spicer Australia Ø Spicer Italy

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
10900000	Equity Shares	Rs. 100 each	Rs. 1090.000 millions
100000	Redeemable Preference Shares	Rs. 100 each	Rs. 10.000 millions
		Total	Rs. 1100.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
108700000	Equity Shares	Rs.10 each	Rs. 1087.000 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2004	31.03.2003	31.03.2002
SHAREHOLDERS FUNDS
1] Share Capital		1087.000	1087.000	1087.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		(291.300)	2.797	2.797
4] (Accumulated Losses)		0.000	(806.739)	(946.306)
NETWORTH		795.700	283.058	143.491
LOAN FUNDS
1] Secured Loans		00.600	0.976	18.392
2] Unsecured Loans		360.900	1223.666	1324.920
TOTAL BORROWING		361.500	1224.642	1343.312
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		1157.200	1507.700	1486.803
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		739.400	798.783	875.973
Capital work-in-progress		0.000	2.202	33.509
Incidental Expenditure pending capitalisation		0.000	0.000	5.048
INVESTMENT		0.000	0.013	0.013
DEFERREX TAX ASSETS		0.000	171.181	171.181
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	159.000	106.013	129.436
	Sundry Debtors	334.200	231.787	350.384
	Cash & Bank Balances	311.400	445.602	261.506
	Other Current Assets	0.000	9.819	1.201
	Loans & Advances	255.400	76.907	78.958
Total Current Assets		1060.000	870.128	821.485
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	615.800	336.456	422.854
	Provisions	27.800	0.000	0.000
Total Current Liabilities		643.600	336.456	422.854
Net Current Assets		416.400	533.672	398.631
MISCELLANEOUS EXPENSES		01.400	1.849	2.448
TOTAL		1157.200	1507.700	1486.803

PROFIT & LOSS ACCOUNT

PARTICULARS	31.03.2004	31.03.2003	31.03.2002
Sales Turnover [including other income]	2699.600	1447.091	1477.946
Profit/(Loss) Before Tax	566.100	139.577	34.712
Provision for Taxation	53.400	0.010	5.081
Profit/(Loss) After Tax	512.700	139.567	29.631
Export Value	0.000	425.231	288.010
Import Value	0.000	69.924	148.852
Total Expenditure	4934.300	1313.244	1514.521

KEY RATIOS

PARTICULARS	31.03.2004	31.03.2003
Debt Equity Ratio	1.47	4.33
Long Term Debt Equity Ratio	1.47	4.33
Current Ratio	2.14	3.10
TURNOVER RATIOS
Fixed Assets	1.68	1.13
Inventory	16.85	13.97
Debtors	7.89	6.39
Interest Cover Ratio	54.91	9.03
Operating Profit Margin (%)	30.83	18.83
Profit Before Interest and Tax Margin (%)	25.83	11.84
Cash Profit Margin (%)	27.97	17.52
Adjusted Net Profit Margin (%)	22.97	10.52
Return on Capital Employed (%)	43.33	11.63
Return on Net Worth (%)	95.05	55.03

LOCAL AGENCY FURTHER INFORMATION

BUSINESS

Subject is engaged in the business as designing, manufacturing, assembling, buying, selling, hiring, exporting, importing, distributing and dealing in all types of universal joints, axles, transfer cases, drive shafts and components thereof for automotive applications whether in finished or semi-finished forms.

Dana, USA is the world leader in Auto component manufacturing. The company in 1904 invented the Universal Joint. Since then Dana is leading the technology in propeller shafts worldwide. Dana is having around 500 facilities in 33 countries.

Anand Group, the Indian partner, is a leading manufacturer of a wide range of automotive components in India. The Group was established in 1961, and consists of 19 multi-location Companies, employing 4,000 people. The Group is a supplier of components to virtually every vehicle and engine manufacturer in India. The relationship of Dana with Anand is built over last 40 years and they are partners in India on many products including Brakes, Piston Rings and Gaskets.

The company was founded in 1993 to manufacture Drive shafts and Axles in India. During 2000, Company's Sales was nearly $35 Million. Company has two Divisions. Axle Division and Drive shaft Division.

Axle Division is located at Chakan in Pune, Maharashtra State, where Axle components are manufactured, assembled into Axles and supplied to the OE customers for vehicle fitment.

Drive shaft Division has 2 Operating Plants. Jodalli Plant near Hubli in Karnataka State manufactures components and Satara Plant, in Maharashtra State assembles the components into Drive shafts and supplies to the OE customers for vehicle fitment. The Division Office as well as the Corporate Office is located at Chakan, Maharashtra, along with the Axle Division office and Axle Plant.

Driveshaft Component Plant at Jodalli, Karnataka, meets the entire requirement of components both for domestic as well as for export. More than 50% of production capacity of this plant is currently exported to Dana plants in USA, UK, France, Australia, Mexico and Canada.
The company’s globally standard parts are common for Domestic and Export. It provides us opportunity to serve its domestic customers with the same products, which get fitted on Ford and GM trucks.

All facilities of the company have QS-9000 Certification. The company has also secured ISO 14001 Certification for environment protection system and OHSAS 18001 certification for health and safety assurance system. The company may be the first Auto component manufacturing company in India, securing all above certificates

Product Features for drive shaft

Superior features of Spicer Propeller Shafts include :

Ø Glidecoated Tube Shaft to reduce friction and increase wear life of Slip Joint and Centre Bearing.

Ø Better balanced and lightweight shafts with Half Round End Yoke design, which also reduce assembly / dismantling time and increase servicing efficiency in Field.

Ø Superior Universal Joint, having metal backed seals, cold formed bearing cups with crowning, radius - ground trunnions for enhanced life and better seal fitting.

Ø Centre Bearings specially designed for Propeller Shaft application and greased for life at factory. Design incorporates double race bearing, land-riding seals for improved grease retention and honeycomb rubber design to reduce vibrations and noise transmission.

Product Performance

The company are the self-certified supplier to Telco and Ashok Leyland. Itsr products go directly to the Customer's Assembly lines on JIT basis.

The company have been manufacturing Propeller Shafts for the last 5 years, and have supplied more than 275,000 vehicle sets to Telco, and 25,000 vehicle sets to Ashok Leyland. The company also supply Propeller Shafts to other OE Customers including Bajaj Tempo, Mahindra & Mahindra and Tatra Udyog.

Telco have approved Spicer Propeller Shafts for fitment on various Trucks and Bus Models including LP 1510/52, LPO 1510/55, LP 1512 TC/52, and LP1512 TC/59 and LPO 1512TC/55.

Telco have supplied more than 5000 buses fitted with Spicer Propeller Shafts to various STU's including UPSRTC, APSRTC, KSRTC, GSRTC, MPSRTC, RSRTC, Himachal SRTC, MTC, as well as many non - STU Operators.

The company have been monitoring performance of Spicer Propeller Shafts at 7 depots of APSRTC and KSRTC. Out of 40 Telco buses surveyed, 32 buses have already completed more than 200,000 kms, and are working satisfactorily. In fact, 9 Buses have already crossed more than 400,000 kms.

Spicer shafts have also been fitted on some of Ashok Leyland buses. The company have been closely monitoring performance of Ashok Leyland buses fitted with Spicer Propeller Shafts at TPTC, Villupuram and Metro Transport Corporation, Chennai. One bus has already completed 0.650 million kms so far and all the fitted sets are working satisfactorily

The company is in trade terms with :

Ø ROC Keeper, Twain

Ø Dana Global Logistics, USA

Ø Albarus Inc, USA

Ø Dana Italia, USA

Ø Dana India Private Limited

Ø Spicer, UK

Ø Spicer, France

Ø Spicer, Australia

Ø Spicer, Italy

The company has developed various new applications for several existing and new vehicles including Telco' 407 & 709 LCVs, SPL 90 range for Ashok Leyland's multi-axle vehicles, Tata's on-off highway truck and Bajaj Tempo's new range of LCVs.

Export Details

The company identified export opportunities with Traction Technology Group (TTG), USA for export of components such as companion flanges, different cases and clutch shaft etc. the company completed the process of product development testing of parts, PPAP, etc

Torque Management Group (Drive shaft Business)

The drive shaft business has seen a significant improvement in operations and profitability during the year. However the management takes serious note of setback in Telco's medium commercial vehicles business due to Telco's design to start using in-house drive shafts in view of failure of end yoke design meeting customers expectations.

Consolidation and Productivity Improvement

Commercial vehicle market in India has been facing recessionary conditions for over two years, although multi utility vehicle market showed some improvement. This got compounded by the economic slowdown in USA, which started in year 2000 and further aggravated after September 11, 2001 incident.

Factory of large size is owned by the company.

Parent company

Dana Corporation

P. O. Box 1000, Toledo, OH 43697, USA

Tel. No. 419 535 4500

Subject is one of the world's largest suppliers of components, modules and complete systems to global vehicle manufacturers and their related after markets. Founded in 1904 and based in Tolledo, Ohio, subject operates some 300 major facilities in 35 countries and employs more than 75000 people. It reported sales of US $ 12.3 billions in the year 2000.

PERFORMANCE ANALYSIS 

 The year under report has been an exceptionally good year in terms of buoyancy in auto industry and overall growth of the economy in general. The country witnessed an unprecedented growth in vehicle production by automobile industry. The multi-utility vehicle market grew by 25% and commercial vehicle market grew by more than 35% during the year. Consequently the auto ancillaries also had significant growth opportunities. 

 During the year under review, the Company recorded net sales of Rs. 2000million, reflecting a steep increase of 49% compared to the previous year. The significant surge in Company's sales is essentially contributed by growth in domestic market, recording an increase of about 63% over previous year. 

 The unprecedented increase in vehicle production and all segments including multi-utility and commercial vehicles and more particularly substantial increase in vehicle production by Tata Motors have helped the Company to achieve such a strong growth. Besides, steep growth in domestic market, the Company could also achieve 21 % higher export sales, compared to previous year without making any major investment in the production capacity. However, in the last one year, the Company has taken various initiatives to grow the export sales which will be reflected as unprecedented growth in the next two years sales. 

The directors are pleased to inform that overall increase in the Company sales and some of the new initiatives undertaken by the Company have helped the Company to substantially improve the financial performance and now the company can expect to recoup all past losses in a year's time. This will give a major satisfaction considering the challenge involved in surmounting this difficult task. 

 The Company has recorded a Profit before Tax of Rs. 566.000 millions in the year under report, compared to Rs. 140.000 millions in the previous year, an increase of more than 300%. Part of this improvement has been contributed by surplus of Rs.366 million generated by pre-payment of sales tax deferral liability at a discount under the scheme announced by State Government of Maharashtra. Even without considering the surplus, the Company earned an operating profit before tax of Rs. 200.000 millions thus maintaining its return on sales at 10% despite absorbing the start-up cost of End Yoke Project at Hosur and adverse impact due to significant increase in steel prices. 

 The improved operations and efficient working capital management helped the Company to achieve negative working capital. This also led to generation of significant cash that was partially utilized during the year for pre-paying$8 million of Dana's foreign currency loan. 

 OPERATIONS 

 Domestic Business 

 The year witnessed a major growth in domestic sales by 62% compared to the previous year, mainly due to significant increase in volumes of Tata Motors and Ashok Leyland, both in multi-utility and heavy commercial vehicle segments. The Company continued to increase its market share both for axle and drive shaft for existing as well as new vehicles. 

The directors are happy to record that the Company has won most of the new applications for rear axle in last few years. Some of the major achievements are summarized as under. 

 * Launch of 'Endeavour' sports utility vehicle by Ford India with Spicer axle and drive shaft. 

 * Successful development of Spicer axle and drive shaft for General Motors India's 'Chevrolet Tavera' launched recently. 

 * Won axle and drive shaft business for Tata Motors' Cub vehicle, planned for launch in early 2005. 

 * Supplied rear axle prototypes to International Car and Motors for up coming multi-utility vehicle. 

 The Company expects a significant growth in heavy commercial vehicles market due to rapid expansion of road infrastructure across the country. The company is actively working with Dana drive shaft Europe to develop required capabilities and designs to meet the challenging requirement of this segment. 

 Exports Business 

 Continued cost pressure in developed countries and insistence by global OEMs for cost reductions is leading major automotive system suppliers to source parts from lower cost countries, resulting in India emerging as a major manufacturing hub. Your Company, as a result, is experience in genormous growth opportunities and is working on many projects on relocation of manufacturing equipment from Dana's various plants at USA and Europe. The Company has set up 100% Export Oriented Units (EOU) at Pune for differential cases and companion flanges, Jodalli (Dharwad) for end yokesand flanges and Hosur for light duty end yokes. These projects will help the Company to avail the benefits of duty free imports for raw material and equipment and tax free profits till March 2009. 

 * Phase I of relocating manufacturing of Light Duty End Yoke from USA has been completed at Hosur EOU and equipment shifting for Phase II is underway, facilitating capacity enhancement to 180,000 pieces a month. 

 * Most of the differential case equipment has arrived at Pune EOU from UK and production will be at full swing in next couple of months to meet the requirement of Land Rover T5 program. 

 * Building expansion work in Jodalli is under progress to receive equipment from UK for end yokes and flanges to commence production is third quarter of the current year. 

 TOTAL QUALITY MANAGEMENT (TQM) 

 The Company continues to improve the manufacturing quality systems an drelated business processes as a major enabler towards its effort to become a quality leader. All the facilities continue to remain certified for ISO/TS 16949 (Quality Management System), ISO 14001 (Environment Management System) and OHSAS 18001 (Occupational Health and Safety Management System). Hosur facility was certified for QS 9000 in November 2003, within two months of start of commercial production. These initiatives have helped the Company to improve working environment and encouraging people involvement as a team. 

 Your directors consider manufacturing improvements by way of Excellence in Manufacturing (EIM) and 'Best-in-Class' approach for comparison by benchmarking with global practices as key business processes. Towards this objectives, the Company continues to work on various initiatives like Dana Quality Leadership Process (DQLP), Dana Production System (DPS), Six Sigma and TPM, Quality-Cost-Delivery-Growth-Productivity (QCDGP) as part of 'Anand Performance Flywheel'. While the Company has been making reasonable progress in implementing these initiatives, a lot more still need to be done to make them robust and sustainable processes. 

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.44.93
UK Pound	1	Rs.78.60
Euro	1	Rs.54.58

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	7
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	7
--LIQUIDITY	1~10	7
--LEVERAGE	1~10	7
--RESERVES	1~10	7
--CREDIT LINES	1~10	7
--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		63

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

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