MIRA INFORM REPORT

Report Date :

01.12.2007

IDENTIFICATION DETAILS

Name :	GABRIEL INDIA LIMITED
Registered Office :	29^th Milestone, Pune-Nashik Highway, Village Kuruli, Taluka Khed, Pune – 410 501, Maharashtra
Country :	India
Financial as on :	31.03.2007
Date of Incorporation :	10.01.2001
Com. Reg. No.:	25-15735
CIN No.: [Company Identification No.]	L34101PN1961PLC015735
TAN No.: [Tax Deduction & Collection Account No.]	PNEG04598G
Legal Form :	Public Limited Liability Company. Company’s shares are listed on the Stock Exchanges.
Line of Business :	Manufacturer of Shock Absorbers, Struts, Front Forks and Engine Bearings. It is also the principal supplier to both the OE and Aftermarket segments with a sizeable presence in the overseas markets

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 5230000
Status :	Satisfactory
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well-established company having fine track. Directors are reported as experienced, respectable and resourceful industrialists. Their trade relations are reported as fair. Payments are correct and as per commitments. The company can be considered good for normal business dealings at usual trade terms and conditions

LOCATIONS

Registered Office :	29^th Milestone, Pune-Nashik Highway, Village kuruli, Taluka Khed, Pune – 410 501, Maharashtra, India
Tel. No.:	91-20-24101931 – 34 / 261091/098/012
Fax No.:	91-20-24101935 / 8018 / 561935
E-Mail :	secretarial@gabriel.co.in
Website :	http://www.anandgroupindia.com
Corporate Office :	Ø 1 Sri Aurobindo Marg, New Delhi – 110 016 Ø Magnet House, N. M. Marg, Ballard Estate, Mumbai – 400 038
Factory 1 :	RIDE CONTROL PRODUCTS Ø S-304, LBS Marg, Mulund (West), Mumbai – 400 080, Maharashtra Ø B-2, MIDC, Ambad Industrial Area, Nasik – 422 010, Maharashtra Ø B-193, Phase II, District Gautam Budh Nagar, Noida 201305, Uttar Pradesh Ø 29^th Milestone, Pune-Nasik Highway, Village Kuruli, Taluka Khed, Pune – 410 501, Maharashtra Ø Chander Nagar Industrial Area, Delhi-Jaipur Highway, Gurgaon – 122 001, Haryana Ø 5, Industrial Area No.3, Agra-Mumbai Road, Dewas - 455 001, Madhya Pradesh Ø 52-55, S. No. 102\3 – 106\(PT), Sipcot, Phase-II, Moranapalli Village, Hosur – 635 109, Tamilnadu ENGINE BEARINGS Ø Plot No. 5, Sector III, Parwanoo – 173 220, Himachal Pradesh

DIRECTORS

Name :	Mr. Arvind Walla
Designation :	Director
Name :	Mr. Deep C Anand
Designation :	Chairman
Name :	Mr. K N Subramaniam
Designation :	Managing Director
Name :	Mr. B L Ruddy
Designation :	Director
Name :	Russi Jal Taraporevala
Designation :	Director
Name :	Mr. C S Patel
Designation :	Director
Name :	Mr. H R Prasad
Designation :	Director
Name :	Mr. Jaithirth Rao
Designation :	Director
Name :	Mr. Ravi K Sinha
Designation :	Director
Name :	Mr. M S Sandhu
Designation :	Director
Name :	Padmini Khare Kaicker
Designation :	Director
Name :	Mr. K N Subramaniam
Designation :	Managing Director
Age :	49 Years
Qualification :	B. Tech., P.G.D.B.M. IIM, Ahmedabad
Experience :	24 Years
Date of Joining :	February, 2001

KEY EXECUTIVES

Name :	Mr. Manoj Tulsian
Designation :	Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

Names of Shareholders	No. of Shares
Indian Promoter	28481350
Collaboration	14843980
Insurance Companies and banks	752683
Mutual Funds and UTI	5649616
FIIs and NRIs	659141
Domestic Companies	2485128
Resident Individuals	18950072
Total	71821970
Equity Share Break-up	Percentage of Holding
Foreign Holdings	60.00
Directors or relatives of Directors	28.49
Other	11.51
Total	100.00

BUSINESS DETAILS

Line of Business :	Manufacturer of Shock Absorbers, Struts, Front Forks and Engine Bearings. It is also the principal supplier to both the OE and Aftermarket segments with a sizeable presence in the overseas markets
Products :	Item Code No. Product Description 870880-00 Shock Absorbers Mcpherson Struts 8714991-00 Front Forks
Export to :	Ø China Ø Russia Ø Europe Ø Far East Ø Asia Pacific Ø Middle East Ø Africa

PRODUCTION STATUS

Particulars	Unit	Installed Capacity	Actual Production
Shock	Nos.	19016685	11289719
Front Forks	Nos.	2574557	1143746
Bimetal Strips	Tones	--	--
Bimetal	Nos.	---	--

GENERAL INFORMATION

No. of Employees :

1243

Bankers :

Ø Standard Chartered Grindlays Bank Limited

Ø Bank of India

Ø ICICI Bank Limited

Ø Punjab National Bank

Ø Citi Bank

Ø Indusind Bank

Facilities :

Particulars	As on 31.03.2007 [Rupees in Millions]
SECURED LOAN
Term Loans	75.000
Working Capital Facilities from Banks	329.210
Transferred on restructuring	124.200
Interest Accrued	0.550
UNSECURED LOAN
Sales Tax Deferral Loans	136.320
Short Term Loan and Advance	309.780
Interest Accrued and due	0.710
Others	9.120

Banking Relations :	Satisfactory
Auditors :
Name :	Price Waterhouse & Company Chartered Accountants
Solicitors :	Udwadia and Udeshi
Memberships :	Confederation of Indian Industry
Parent Company :	Ø Federal Mogul Corporation, United States of America Ø Gabriel Ride Control Products, United States of America
Associates/Subsidiaries :	Stallion Shox Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
140000000	Equity Shares	Re.1/- each	Rs. 140.000 Millions
100000	Cumulative Redeemable Preference Shares	Rs. 100/- each	Rs. 10.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
71821970	Equity Shares	Re. 1/- each	Rs. 71.821 Millions
	Share Forfeiture		Rs. 0.030 Million
	Total		Rs. 71.851 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2007	31.03.2006	31.03.2005
SHAREHOLDERS FUNDS
1] Share Capital		71.850	71.850	71.900
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		1236.310	922.920	891.800
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		1308.160	994.770	963.700
LOAN FUNDS
1] Secured Loans		280.560	475.210	473.000
2] Unsecured Loans		455.930	557.640	439.500
TOTAL BORROWING		736.490	1032.850	912.500
DEFERRED TAX LIABILITIES		105.550	194.790	0.000
TOTAL		2150.200	2222.410	1876.200
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		1020.020	1330.970	1323.200
Capital work-in-progress		160.780	45.960	22.100
INVESTMENT		9.770	9.770	09.800
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	380.310	469.160	411.400
	Sundry Debtors	598.490	681.440	499.300
	Cash & Bank Balances	195.590	162.580	157.100
	Loans & Advances	630.030	406.630	629.200
Total Current Assets		1804.420	1719.810	1697.000
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	658.340	787.780	864.400
	Provisions	186.450	96.320	311.500
Total Current Liabilities		844.790	884.100	1175.900
Net Current Assets		959.630	835.710	521.100
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		2150.200	2222.410	1876.200

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
Sales Turnover		5162.590	4852.430	4962.500
Other Income		918.860	6081.450
Total Income		6081.450	10933.880	4962.500
Profit/(Loss) Before Tax		981.480	152.900	263.200
Provision for Taxation		250.330	64.460	84.300
Profit/(Loss) After Tax		731.150	88.440	178.900
Expenditure in Foreign Currency		69.430	156.190	--
Value of Imports		362.3606	254.4106	--
Expenditures :
	Excise Duty	11.570	8.780
	Cost of Materials	3843.910	3469.370
	Personnel Expenses	408.00	383.130
	Interest	65.910	82.710
	Depreciation	126.630	157.990
	Other Expenditure	643.950	747.950
Total Expenditure		5099.970	4849.930	5114.800

QUARTERLY RESULTS

PARTICULARS	30.06.2007	30.09.2007
Type	1^st Quarter	2^nd Quarter
Sales Turnover	1084.900	1129.800
Other Income	51.900	27.100
Total Income	1136.800	1156.900
Total Expenditure	1056.100	1085.700
Operating Profit	80.700	71.200
Interest	14.900	15.300
Gross Profit	65.800	55.90000
Depreciation	34.600	33.300
Tax	13.200	09.100
Reported PAT	19.400	12.500

KEY RATIOS

PARTICULARS	31.03.2007	31.03.2006	31.03.2005
Debt-Equity Ratio	0.77	0.99	1.04
Long Term Debt-Equity Ratio	0.26	0.47	0.70
Current Ratio	1.08	1.04	1.11
Fixed Assets	2.52	2.16	1.93
Inventory	14.15	12.76	13.14
Debtors	9.39	9.46	9.40
Interest Cover Ratio	4.59	2.78	4.60
Operating Profit Margin (%)	7.29	7.07	10.23
Profit Before Interest And Tax Margin (%)	5.18	4.25	7.04
Cash Profit Margin (%)	4.63	4.39	6.93
Adjusted Net Profit Margin (%)	2.53	1.57	3.74
Return On Capital Employed (%)	15.30	12.24	18.25
Return On Net Worth (%)	13.19	9.03	19.82

LOCAL AGENCY FURTHER INFORMATION

Performance:

The Indian Economy continued to maintain growth momentum and witnessed growth in GDP of 9.2% for the year, which was contributed by major growth in the service sector of 11.2%, industrial growth of 10.0% and marginal agriculture growth rate of 2.7%. Automotive industry continued to grow faster as compared to the GDP and registered a growth of 14.5% which is substantially higher than overall industry growth rate of 10%. This is mainly due to introduction of new models, continuous increase in demand and easy availability of financing options. Within the Automotive industry, motorcycle and two wheelers segment recorded a growth of 12% (previous year 16.4%), Passenger Cars segment grew by 19.7% against a growth of 7.5% in the previous year and the commercial vehicle business registered a growth of 32% (previous year 10.5%). 

The Company continues to grow in the OE segment and maintain its leadership in terms of customer base across all segments viz Passenger Cars, Commercial Vehicles and Two wheelers. Aftermarket volumes has not shown any significant growth but we still continue to maintain our leadership position in this segment.

The Company's sales at Rs.6011.2 million during the year recorded a growth of 7.0% over the previous year's sales at Rs.5617.4 million. However the previous year sales also included the sales value of Bearings which has been demerged into a separate Company (covered separately in the report).

However on a standalone basis Ride Control Business has registered an overall growth of 14%. This was achieved by new business developed during the year, increase in volumes from existing customer base and offering wider product range for Ride Control Products. During the year the raw material prices continued to maintain an upward trend especially aluminium, oil, rubber products and steel but the Company was able to partly mitigate the increase by alternate sourcing including new suppliers from China, import substitution and price increase from the customers. The Demerger of the Engine Bearings business has provided substantial improvement to the bottom line; as a result the Company posted a Profit before Tax Rs.981.5 million (also includes extraordinary income net of expenses of Rs.682.0 Million on account of sale / ceding development rights of land at Mulund) against Rs.152.9 million in the previous year thus registering a growth of 100% without considering the extraordinary income on account of land sale. After making provision for tax, which included capital gains on account of land sale, fringe benefit tax and one time extraordinary tax of Rs.32.8 million (on account of providing for superannuation liability as per the revised guidelines of AS15), the Company achieved Profit after Tax of Rs.731.2 million compared with Rs.88.4 million in the previous year. 

Dividend: 

The Directors had declared an interim dividend of Rs.0.30 per equity share of Rs. One each (Previous year Interim Dividend Rs.3.0 per equity share of Rs. Ten each). This dividend amounted to Rs.21.6 million (previous year Rs.21.6 Million). The same was distributed to the shareholders whose names appeared on the Register of Members as on October 27, 2006. A 2nd interim dividend of Rs.0.40 per equity share of Rs. One each (Previous year Nil) was declared. This dividend amounted to Rs.28.7 million (previous year Nil). The same was distributed to the shareholders whose names appeared on the Register of Members as on April 3, 2007. 

Thus the Company had declared a total of 70% by way of interim dividends.

The Directors have not recommended any further dividend and therefore the total dividend for the year is 70% (Previous year 70%)

Operations: 

Ride Control Products: 

The turnover of the Ride Control Products increased to Rs.6011.2 million from Rs.5273.1 million in the previous year reflecting an increase of 14% and correspondingly the production of Shock Absorbers, McPherson Struts and Front Forks reached a level of 12.4 million nos. as against 10.9 million nos. of the previous year. This has been possible because of the continuous thrust on strengthening and enhancing the OEM customer base by offering better quality products and development of new products to meet the requirements of various OEMs, for the entire range of Ride Control Products. Major efforts were directed to enhance design, product development and validation capabilities of Company's R&D Centre for four wheelers at Chakan. The Company continued to make investments during the year to upgrade the quality levels so as to deliver quality products to the customers. 

Engine Bearings: 

The Company during the year decided to Demerge the Engine Bearings Division of the Company having plants situated at Parwanoo and Khandsa with the Appointed Date as April 1, 2006. The same was approved by the share holders in the Court Convened meeting held on January 10, 2007. The Scheme was then filed with Hon'ble High Court of Bombay along with the report of the Court convened meeting and the other relevant documents. The Demerger Scheme was approved by the Hon'ble High Court of Bombay in the hearing dated March 16, 2007. The order for the same was issued on March 29, 2007 and the same was filed with the ROC on April 16, 2007 which is the Effective Date for the Demerger while the Appointed Date was April 1, 2006.

They, therefore, have not included the performance of Bearings business in this report for the year 2006-07. An agreement has been signed with Federal-Mogul, Corporation, USA for collaboration in Engine Bearing Business in the Resulting Company which will be an unlisted Company. The Shareholders of the Company will have the option to exit from the Resulting Company by allowing their shares to be bought by the Company under the exit route as specified in the Scheme of Arrangement and Restructuring. The Shareholders of the Resulting Company post record date will be given an option to remain as shareholders of the Resulting Company or sell the shares to the Company, in which case cheques will be sent to them for the entitled amount. This is to facilitate the shareholders to sell their shares in the unlisted Company. The Record date for issue of shares was initially fixed on June 1, 2007. However, approval to Federal-Mogul Corporation from Bankruptcy court in U.S.A. for investment in the Resulting Company is under process and it is likely to take some time. As requested by Federal-Mogul Corporation, the Record date has been shifted to August 24, 2007 and the Stock Exchanges have been notified accordingly.

They want to place on record their appreciation to the co-operation extended by Federal-Mogul Corporation, USA who have agreed to become a majority partner with 63.8% equity holding in the Resulting, unlisted Public Limited Company for Engine Bearings. 

Mulund Unit: 

The Company sold/ceded development rights of the property situated at Mulund during the year for a total consideration of Rs.850 Mill. This has helped the Company to repay some of the debts during the year and improve upon the Debt Equity ratio. The company also closed down its manufacturing facility started in 1961 and situated at the above property as a part of the consolidation process. These events will add value to the shareholders. 

Exports: 

The Company exported Ride Control Products valued at Rs.69.4 million in the year as against Rs.96.0 million (Rs.156.2 million including Engine Bearings) during the previous year and this included exports to several developed markets. During the year, the Company continued to export Shock absorbers to SOQI Hydraulic Systems, Japan, which has had excellent relations with the Company for the last several years as a provider of technology for two wheeler products. The sales dropped compared to the previous year because one of their major customers in Japan ended up having huge inventories. The Company also commenced supplies to Arvin Meritor Inc., USA during the year. The same has been taking time as it involves major validation and product approvals from their OEM in commercial vehicle segment (CVS). However the prospects look very good in the upcoming years once the sample approval testing and validation is complete. 

The Company will continue its efforts to secure new markets for entire range of products, particularly in North America and Western Europe through Arvin Meritor Inc., USA. 

Fixed Assets :

Ø Freehold and leasehold land

Ø Buildings

Ø Plant and machinery

Ø Vehicles

Ø Furniture’s and fixtures

Ø Technical Know-how 

Ø Computer Software

Company is in trade terms with :

Ø Spark Spring Industries Private Limited

Ø Dani Auto Private Limited

Ø Sagar Springs Private Limited

Ø Flexible Packaging Industries

Ø Imanes Private Limited

Ø Nasik Auto Tech Private Limited

Ø Vaishnavi Auto (Private) Limited

Ø Narasipur Precision Private Limited

Ø Devki Auto Industries Private Limited

Ø Logwell Forge Limited

Ø Marpol Chemical Limited

Ø Pooja Forge Private Limited

Ø Paco Rubber Industries (Private) Limited

Ø Dyna-K Automotive Stamping (Private) Limited

Ø Innova Rubbers Private Limited

Ø Jayshree Polymer Private Limited

Ø Karishma Polymers Private Limited

AS PER WEBSITE DETAILS

Subject is a leading name in the Indian auto component industry, manufactures Ride Control Products and Engine Bearings.

Established in 1961 in Mumbai for the manufacture of shock absorbers, Gabriel is the market leader for Ride Control Products in India. It is the flagship company of the USD 410 million Anand Automotive Systems - a leading manufacturer and supplier of the widest range of automotive components and systems in India. Gabriel India, with a turnover of over USD 110 million is a major supplier to all segments of the market - OE, Aftermarket and Exports. The Company is in collaboration with ArvinMeritor Inc. and Federal-Mogul of USA.

Gabriel India has nine plants located across six states of the country and was the first Company in India to be accredited with ISO 9002 Certification as far back as 1993 for shock absorbers, struts and front forks. Today, almost all facilities of the company have ISO 9002 / 9001 / 14001, QS 9000, OHSAS 18001 and ISO / TS 16949 certifications.

Profiles
Subject has the widest range of Ride Control Products in India and enjoys a leadership position in the market. It has seven plants with a total manufacturing capacity of over 10 million shock absorbers, struts and front forks. The Company caters to the requirements of all segments - Original Equipment, Replacement Market and Exports for application in two, three and four wheelers as well as for the Indian Railways.

Manufacturing facility

Subject has seven Ride Control facilities located in Mumbai, Nashik, Pune, Hosur, Dewas, Gurgaon and Noida, with a combined manufacturing capacity of over 10 million units per annum.

To ensure JIT supplies, the Company’s state-of-the-art facilities are strategically located in close proximity to those of its OE Customers.

Products, as per designs most suited for end use application, are manufactured in the various locations of Gabriel India.

Certifications

ISO 9002 - Nashik, Hosur, Noida

ISO 9001 - Mulund

ISO 14001 - Hosur, Dewas, Pune

QS 9000 - Noida, Hosur, Dewas, Nashik

ISO/TS 16949 - Hosur, Pune, Dewas

OHSAS 18001 - Hosur, Dewas, Pune

Products

Shock Absorbers for Two-wheelers

Mono Tube and Twin Tube

Hydraulic and Gas

Shock Absorbers, McPherson Struts and Cartridges for Four-Wheelers

Hydraulic and Gas-charged

Twin Tube Type

Hydraulic Front Forks

Type Ceriani Type Hydraulic

Slider Tube Dia 30 mm

Tube Finish Hard Chrome – Bright

Outer Tube Aluminium Die Cast

Railway Shock Absorbers

Ø Cylinder Bore upto 52 mm

Research and Developments

Subject has two state-of-the-art R&D Centres, located at Pune and Hosur, equipped with ultra-modern facilities to cater to the requirements of its customers.

For 4-wheelers at Chakan, near Pune

This R&D Centre provides valuable inputs to all plants of the Company in several areas including noise measurement, value engineering, improving product build quality by analysis of root causes of customer claims as well as cost reduction through localisation efforts.

Testing & Validation Facilities

Ø MTS Servo Hydraulic Test System - 4 nos

Ø Endurance Testing Machines for Shock Absorbers and Components

Ø Oil Testing

Ø Environmental Chamber

Ø Sample Fabrication Machine Tools and Equipment

Ø Salt Spray Test

For 2-wheelers at Hosur
For two wheelers, Gabriel India has a dedicated R&D team based at its Hosur facility. To provide complete suspension solutions for better ride comfort, the R&D team works closely with its customers to ensure 100% participation right from inception to production.

Testing & Validation Facilities

Ø BISS Servo Hydraulic Test System - 1no.

Ø Coil Spring Endurance

Ø Cam Drum, Bump Test for Shock Absorbers, Front Forks & Components

Ø Endurance Test Machine For Shock Absorbers & Components

Ø Salt Spray Test

Ø Oil & Rubber Testing

Ø Microstructure-checking Facility

Ø Sample Fabrication Machine Tools & Equipment

Technical Capabilities

Ø Developing all types of Shock Absorbers, McPherson Struts & Front Forks

Ø Product Design as per customer requirement

Ø Product Testing & Validation

Ø Ride tuning support to customers

Design Capabilities

Ø 6 CAD Stations

Ø Solid modeling software

Ø FEA (ANSYS)

Ø IDEAS (Planned)

Access to External Test Facilities

Ø Structural fatigue tests at ARAI, Pune

Ø Rubber tests at IRMRA, Mumbai

Ø Rubber durability tests at suppliers’ factory

Ø Material test labs at Pune, Gurgaon & Bangalore

Ø Indian Institute of Science, Bangalore

Ø Welding Research Institute, Trichy

Ø Central Electro Chemical Research Institute, Karaikudi

Ø Central Machine Tools Institute, Bangalore

Collaborators

Financial & Technical	ArvinMeritor Inc, USA, a global provider of integrated automotive systems, modules and components for OEMs and Aftermarkets with annual sales turnover of about US $ 7 billion.
Technical Assistance Agreements	- Kayaba, Japan - APA Kayaba, Spain - SOQI (100% subsidiary of Yamaha), Japan

Cars and Utility Vehicles

Ø Suzuki

Ø Ford

Ø Hyundai

Ø Toyota

Ø Mitsubishi

Ø Tata

Ø Mahindra & Mahindra

Ø Fiat

Ø Hindustan Motors

Ø Bajaj Tempo

2-3 Wheelers

Ø TVS (Scooters & Motorcycles)

Ø Bajaj (Scooters & Motorcycles)

Ø Yamaha (Motorcycles)

Ø LML (Scooters)

Ø Kinetic Motors

Ø Kinetic Engineering (Motorcycles)

Ø Enfield (Motorcycles)

Ø Honda Motor Cycles & Scooters India (Scooters)

LCVs / HCVs

Ø Mahindra & Mahindra

Ø Eicher Motors

Ø Swaraj Mazda

Ø Telco

Ø Bajaj Tempo

Ø Ashok Leyland

Ø Hindustan Motors

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. 39.67
UK Pound	1	Rs. 81.78
Euro	1	Rs. 58.46

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	4
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	9
--PROFITABILIRY	1~10	4
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	6
--RESERVES	1~10	8
--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	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		55

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.	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
NR		In view of the lack of information, we have no basis upon which to recommend credit dealings	No Rating

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