MIRA INFORM REPORT

Report Date :

10.02.2007

IDENTIFICATION DETAILS

Name :	AIRCEL DIGILINK INDIA LIMITED
Registered Office :	C-48, Okhla Industrial Area, Phase II, New Delhi – 110 020, India
Country :	India
Financials (as on) :	31.12.2005
Date of Incorporation :	20.06.1997
Com. Reg. No.:	55-88088
CIN No.: [Company Identification No.]	U64201DL1997PLC088088
TAN No.: [Tax Deduction & Collection Account No.]	DELA13321A
PAN No.: [Permanent Account No.]	AAACA3202D
Legal Form :	Closely held public limited liability company
Line of Business :	Dealers of mobile cellular phones, handsets and accessories.

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 :	Satisfactory
Payment Behaviour :	Slow by +30/45 days
Litigation :	Unknown
Comments :	Financial position of the company is moderate having substantial accumulated losses. The company is not doing well as most of the cellular companies in the world. The company was promoted by Essar Group of Mr. S. Ruia and Mr. R. Ruia. Payments to local suppliers are slow by +30/45 days. The company can be considered normal for business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office / Corporate Office :	C-48, Okhla Industrial Area, Phase II, New Delhi – 110 020, India
Tel. No.:	91-11-26828849
Fax No.:	91-11-9811144444/9811098113
E-Mail :	91-11-26828874
Website :	amitkhera@essarcellphone.net / s.venkatesh@hutchindia.com
Location :	Industrial
Head Office :	21, Feroze Gandhi Road, Lajpat Nagar III, New Delhi – 110 02
Tel. No.:	91-11-26842563 / 26849546
Fax No.:	91-11-26332282 / 26827870
E-Mail :	leased - Medium Size
Area :	Semi-commercial
Branches :	Ø 21, Feroz Gandhi Road, Lajpat Nagar III, New Delhi – 110 024 Ø Chennai, Tamilnadu Ø Mumbai

DIRECTORS

Name :	Mr. Shashi Nandkishore Ruia
Designation :	Chairman
Name :	Mr. Ravikant Nandkishore Ruia
Designation :	Director
Name :	Mr. Anshuman Shashi Ruia
Designation :	Director
Name :	Mr. Vikash Hariprasad Saraf
Designation :	Director
Name :	Mr. Prashant Shashi Ruia
Designation :	Director
Name :	Mr. Sanjeev Shriya
Designation :	Director
Name :	Mr. Ravi Nandkishore Ruia
Designation :	Director
Date of Birth :	29.07.1956
Date of Appointment :	31.01.2000
Name :	Mr. Anshuman Ruia
Designation :	Director
Date of Birth :	11.03.1971
Date of Appointment :	06.09.2002
Name :	Mr. Asim Ghosh
Designation :	Director
Date of Birth :	07.12.1947
Date of Appointment :	27.08.2003
Name :	Mr. F. John Christopher
Designation :	Director
Date of Birth :	16.08.1956
Date of Appointment :	27.08.2003
Name :	Mr. Geoffrey Carolan
Designation :	Director
Date of Birth :	13.03.1966
Date of Appointment :	27.08.2003

KEY EXECUTIVES

Name :	Mr. Thomas Melchior
Designation :	Chief Executive Officer
Name :	Mr. Srinivasan Venkateshan
Designation :	Company Secretary
Date of Birth :	27.01.1961
Date of Appointment :	16.04.2001
Name :	Nalin Tikkoo
Designation :	Chief Executive Officer
Name :	Mr Nishchint Khanna
Designation :	Manager
Address :	2/138, Vijay Khand, Gomti Nagar, Lucknow, Uttar Pradesh – 226010, India

MAJOR SHAREHOLDERS

Names of Shareholders	No. of Shares
M/s. Swiss Com Limited, Switzerland	10000
M/s. Hutchison Telecom East Limited	101089995
I P Sand Jointly with Hutchison Telecom East Limited	1
K Sankara Narayan Jointly with Hutchison Telecom East Limited	1
Rajiv Sawhney Jointly with Hutchison Telecom East Limited	1
Sundeep Kathuria Jointly with Hutchison Telecom East Limited	1
Neha Sharma Jointly with Hutchison Telecom East Limited	1
Total	101100000
Category of Shareholders	Percentage of Holding
Bodies Corporate	100.00
Total	100.00
Debentures (Value : Rs. 100 each)
M/s Essar Teleholdings Limited	25788000
M/s Karthik Financial Services Limited	100000
Total	25888000

BUSINESS DETAILS

Line of Business :

Dealers of mobile cellular phones, handsets and accessories.

Products :

Indian Trade Classification	Description of the product or services
85-25-20	Cellular mobile telephone services

Brand Names :

“ESSAR”.

Imports from :

USA, Singapore and Switzerland

Terms :

Selling :

Cash or Credit (7 to 30 days) terms

Purchasing :

Cash, Contract, L/C or other terms

GENERAL INFORMATION

Customers :	Wholesalers and corporates
No. of Employees :	150
Bankers :	Ø Deutsche Bank AG, Tolstoy Marg, New Delhi Ø Vysya Bank Limited, Dr. A. B. Road, Worli, Mumbai – 400 018 Ø Global Trust Bank, Nariman Point, Mumbai – 400 021 Ø HSBC
Banking Relations :	Unknown
Auditors :	Price Water House Chartered Accountants
Address :	PWC House, P-1, Aditya Vihar, Saidulajab, D Block, Saket, Mehrauli Badar Pur Road, New Delhi – 110030, India
Associates :	Ø Essar Oil Limited Ø Essar Steel Limited Ø Essar Investment Limited Ø Essar Shipping Limited Ø Sterling Computers Limited Ø Syscom Technologies Limited Ø Hutchison Essar Telecom Limited Ø Hutchison Max Telecom Private Limited Ø Hutchison Essar South Limited Ø Cellular Mobile Telephone Services
Holding Company :	Hutchison Telecom East Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
101,200,000	Equity Shares	Rs. 10 each	Rs. 1012.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
101,100,000	Equity Shares	Rs. 10 each	Rs. 1011.000 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.12.2005 [12 months]		31.12.2004 [12 months]		31.12.2003 [9 months]
SHAREHOLDERS FUNDS
1] Share Capital	1011.000		1011.000		1011.000
2] Reserves & Surplus	0.000		(3378.200)		(3213.403)
3] (Accumulated Losses)	(2753.930)		0.000		0.000
NETWORTH	(1742.930)		(2367.200)		(2202.403)
LOAN FUNDS
1] Secured Loans	3520.490		3495.700		1050.869
2] Unsecured Loans	5371.080		3941.100		3953.350
TOTAL BORROWING	8891.570		7436.800		5004.219
TOTAL	7148.640		5069.600		2801.816
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]	7240.010		5340.400		2635.815
Capital work-in-progress	1390.660		0.000		837.684
INVESTMENTS	0.000		0.000		0.000
DEFERREX TAX ASSETS		250.320		0.000		0.000
CURRENT ASSETS, LOANS & ADVANCES
Inventories	0.000		0.000		0.000
Sundry Debtors	371.810		414.100		167.414
Cash & Bank Balances	1132.970		296.400		237.917
Other current assets	190.210		0.000		0.000
Loans & Advances	825.740		1422.400		786.002
Total Current Assets	2520.730		2132.900		1191.333
Less : Current Liabilities & Provisions
Current Liabilities	4039.830		2389.900		1863.016
Provisions	213.250		13.800		0.000
Total Current Liabilities	4253.080		2403.700		1863.016
Net Current Assets	(1732.350)		(270.800)		(671.683)
MISCELLANEOUS EXPENSES	0.000		0.000		0.000
TOTAL	7148.640		5069.600		2801.816

PROFIT & LOSS ACCOUNT

PARTICULARS	31.12.2005 [12 months]	31.12.2004 [12 months]	31.12.2003 [9 months]
Sales Turnover [including other income]	6759.674	4069.800	1136.322
Profit/(Loss) Before Tax	443.704	(164.800)	92.264
Provision for Taxation	624.229	0.000
Profit/(Loss) After Tax	(180.525)	(164.800)	1581.605
Total Expenditure	6315.971	4197.909	744.326

KEY RATIOS

PARTICULARS		31.12.2005 [12 months]	31.12.2004 [12 months]	31.12.2003 [9 months]
PAT / Total Income	(%)	(2.67)	(4.04)	139.19
Net Profit Margin (PBT/Sales)	(%)	6.56	(4.04)	--
Return on Total Assets (PBT/Total Assets}	(%)	4.54	(2.20)	1.17
Return on Investment (ROI) (PBT/Networth)		(0.25)	(6.96)	(0.09)
Debt Equity Ratio (Total Liability/Networth)		(7.54)	(4.15)	(6.79)
Current Ratio (Current Asset/Current Liability)		0.59	0.88	0.64

LOCAL AGENCY FURTHER INFORMATION

Subject import communication equipments, Handsets and Accessories.

History

Subsequently, the Registered Office of the company was shifted to Delhi with effect from 12.05.1997 and new Company Registration Number 88088 of Delhi ROC was obtained.

It acts as distributors for Essar Cellophone Wirefree-communication Service.

The company was awarded licenses for operating cellular mobile telephone services in the states of Haryana, Rajasthan and Uttar Pradesh by the Department of Telecommunications.

The company is in trade terms with the following :

Ø Essar Cel

Ø Essen Communication GmbH, Germany

AS PER WEBSITE

New Clippings

Source : Time News Network (Dated: January 21, 2002)

30% Hutch Max stake valued at Rs 1700 Millions

JAMES MATHEW

TIMES NEWS NETWORK[ MONDAY, JANUARY 21, 2002 01:21:56 AM]

NRI Special Offer!

new delhi: the essar group is close to acquiring 30 per cent stake each in hutchison-controlled cellular ventures in kolkata (usha martin telekom) and mumbai (hutchison max) circles. According to sources close to the deal, the ruias and hutchison brass are currently in advanced stage of negotiations and the deals are expected to be wrapped up in 2-3 months. while essar group and hutch are learnt to have arrived at a valuation of about $35 million (close to rs 1700 Millions) for the 30 per cent stake in usha martin telekom, which was acquired by hutchison in 2000, the two are still in the process of thrashing out the valuation issue for the mumbai circle. sources said essar group's stake acquisition plans in the two hutch-controlled cellular ventures is a precursor to the two finally merging all their cellular operations into a new company. when contacted, essar teleholding ceo vikas saraf confirmed to et the stake acquisition plans in the two hutch-controlled cellular ventures. "Company has an agreement with hutchison on acquiring 30 per cent stake of them in these two circles and currently company is in talks with them for finalising the deals. company expect the deals to be completed in 2-3 months," saraf said. despite repeated attempts, hutchison's india operations managing director mr asim ghosh could not be contacted for his comments. messages left on his voice mail elicited no response. sources said in both the circles, essar will be acquiring the stake from the hutchison-kotak jvs. hutchison directly holds 49 per cent stake in usha martin telekom, while it reportedly holds another 46 per cent through a jv with kotak in the venture. five per cent stake is with the jhawars, the original promoters of umtl. in the mumbai cellular venture, hutchison telecommunications holds 49 per cent directly and another 41 per cent through telecom investment india ltd, an spv floated with kotak. max group and aig also hold 6 per cent and 4 per cent stake respectively in the mumbai venture, which provides the orange mobile network. under the roadmap finalised by the two groups, the proposed merger will be completed in two phases, with an initial public offer (ipo) by the combined entity separating the two phases. in the first phase which is expected to be kicked off in the next three months, essar's stake in two of its jvs with hutchison — sterling cellular (the 49:49 jv between the two for the delhi cellular circle) and hutchison essar south (originally barakhamba sales and services which has the fourth cellular licenses in ap, karnataka and chennai) will be merged with hutch's other cellular companies in mumbai, calcutta and gujarat to form a new company. this merged entity will then go for an initial public offering mid 2003 and within six months of the public offer, essar group's other two telecom ventures — evergrowth telecom and aircell digilink india, which holds cellular licenses for punjab, haryana, rajasthan and up (east), respectively, will also be merged with the company "at a valuation to be decided by an independent valuer" to form the final consolidated entity.

This form is for	Creation of Charges
Corporate identity number of the company	U64201DL1997PLC088088
Name of the company	AIRCLE DIGILINK INDIA LIMITED
Address of the registered office or of the principal place of business in India of the company	C-48, Okhla Industrial Area, Phase – II, New Delhi – 110020, India
Type of charge	Plant and Machinery Furniture and Fixtures Stock in Trade Book Debts Vehicles Fixed Deposits Intangible Assets
Particular of charge holder	IL And FS Trust Company Limited IL And FS Centre, Plot No C-22, G Block, Bandra Kurla Complex, Bandra East, Mumbai – 400051, Maharashtra, India
Nature of description of the instrument creating or modifying the charge	Deed of Hypothecation dated 21.0.2006, executed by the company in favor of IL and FS Trust Company Limited as security-details in annexure 1
Date of instrument Creating the charge	21.02.2006
Amount secured by the charge	Rs.67100.000 Millions

CMT REPORT [Corruption, Money laundering & Terrorism]

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

1] INFORMATION ON DESIGNATED PARTY

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

2] Court Declaration :

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

3] Asset Declaration :

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

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

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

Charges or investigation registered against subject: None

7] Criminal Records

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

8] Affiliation with Government :

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

9] Compensation Package :

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

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

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

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

CONTRAVENTION

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

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.44.06
UK Pound	1	Rs.86.34
Euro	1	Rs.57.46

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	4
PAID-UP CAPITAL	1~10	4
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	4
--PROFITABILIRY	1~10	0
--LIQUIDITY	1~10	2
--LEVERAGE	1~10	3
--RESERVES	1~10	2
--CREDIT LINES	1~10	5
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		29

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

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

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

RATING EXPLANATIONS

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

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