MIRA INFORM REPORT

Report Date :

10.02.2007

IDENTIFICATION DETAILS

Name :	MILAN LABORATORIES (INDIA) PRIVATE LIMITED
Formerly Known As :	MILAN LABORATORIES (INDIA)
Registered Office :	A-5, Mega Malhar, Gawand Path, Navpada, Thane – 400602, Maharashtra
Country :	India
Financials (as on) :	31.03.2006
Date of Incorporation :	26.03.2003
Com. Reg. No.:	11-139736
CIN No.: [Company Identification No.]	U24230MH2003PTC139736
TAN No.: [Tax Deduction & Collection Account No.]	PNEM08623G
PAN No.: [Permanent Account No.]	AADCMS148B
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacturer and Exporter of Pharmaceutical Formulations

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 15000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a successor to an established pharmaceutical concern. Directors are reported as experienced, respectable and resourceful businessmen. Their trade relations are fair. Payments are usually correct and as per commitments. The concern can be considered good for normal business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	A-5, Mega Malhar, Gawand Path, Navpada, Thane – 400602, Maharashtra, India
Tel. No.:	91-22-25447341/25390686
Fax No.:	91-22-25401744
E-Mail :	marketing@milanlabs.com milabs@vsnl.com
Website :	http://www.milanlabs.com
Status :	Owned
Factory :	Plot Nos. 63/67, Jawahar Co-operative Industrial Estate Limited, Kamothe, Panvel, Navi Mumbai
Tel. No.:	91-22-27421910/27420391
Fax No.:	91-22-27421010
Status :	Owned

DIRECTORS

Name :	Mr. Upendra Madan Deshpande
Designation :	Director
Address :	Flat No. 93, 9^th Floor, Rohini Building, Tarangan Towers, Kalpataru, Thane – 400607, Maharashtra, India
Date of Birth/Age :	30.04.1963
Qualification :	Graduate
Date of Appointment :	26.03.2003
Election Commission Identity Card No. :	MT/10/053/1039017
Name :	Mrs. Rohini Rajiv Dongre
Designation :	Director
Address :	14C-21, Brindavan Society, Majiwade, Thane – 400601, Maharashtra, India
Date of Birth/Age :	28.10.1959
Qualification :	M. Sc.
Date of Appointment :	26.03.2003
Election Commission Identity Card No. :	MT/10/054/0603343

MAJOR SHAREHOLDERS

Names of Shareholders	No. of Shares
Lalita Madan Deshpande Jointly with Madan Mahadeo Deshpande	3000
Mrs. Rohini Rajiv Dongre	3000
Mr. Upendra Madan Deshpande	3000
Ms. Megha Milind Hajimis	1000
Total	10000

BUSINESS DETAILS

Line of Business :

Manufacturer and Exporter of Pharmaceutical Formulations

Product :

Product Description	ITC Code No
Ibuprofen Tablet 200 mg	KD540
Amoxicillin Capsules 500 mg	KD380
Cotrimoxazole Tablet 80 x 480 mg	KD540

Exports to :

West Africa, East Africa, South East Asia, New Zealand

Imports from :

China and Spain

Terms :

Selling :

L/C, D/A terms

Purchasing :

L/C, Cash, D/P at sight and Credit

PRODUCTION STATUS

Particulars	Unit	Installed Capacity
Betalactum Capsules	Nos. in Lacs	7,500
Tablet	Nos. in Lacs	10,771
General Capsules	Nos. in Lacs	2,100
Ointment	Kgs.	162,000
Liquid	Ltrs.	1,152,000

GENERAL INFORMATION

Customers :	Wholesalers
No. of Employees :	200
Bankers :	· ICICI Bank Limited, Nariman Point, Mumbai-400021 · State Bank of India, Kamothe [Panvel] Branch, Panvel, Maharashtra, India

Banking Relations :	Satisfactory
Auditors :	R. P. Shah and Company Chartered Accountants 35, 3^rd Floor, Tardeo AC Market, Tardeo, Mumbai – 400037, Maharashtra, India

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
10,000	Equity Shares	Rs. 10/- each	Rs. 0.100 million

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
10,000	Equity Shares	Rs. 10/- each	Rs. 0.100 million

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2006	31.03.2005	31.03.2004
SHAREHOLDERS FUNDS
1] Share Capital		0.100	0.100	0.100
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		4.179	8.796	9.294
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		4.279	8.896	9.394
LOAN FUNDS
1] Secured Loans		46.729	31.077	13.503
2] Unsecured Loans		89.357	84.978	76.418
TOTAL BORROWING		136.086	116.055	89.921
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		140.365	124.951	99.315
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		55.897	58.179	31.021
Capital work-in-progress		0.205	0.000	0.397
INVESTMENT		0.000	0.000	0.003
DEFERREX TAX ASSETS		1.429	2.564	3.674
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	19.203	26.316	60.252
	Sundry Debtors	94.564	65.544	38.669
	Cash & Bank Balances	13.136	10.573	15.916
	Other Current Assets	8.228	19.279	36.844
	Loans & Advances	8.223	5.483	5.383
Total Current Assets		143.354	127.195	157.064
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	60.059	63.004	92.863
	Provisions	0.476	0.000	92.863
Total Current Liabilities		60.535	63.004	92.863
Net Current Assets		82.819	64.191	64.201
MISCELLANEOUS EXPENSES		0.015	0.017	0.019
TOTAL		140.365	124.951	99.315

PROFIT & LOSS ACCOUNT

PARTICULARS	31.03.2004
Sales Turnover [including other income]	336.937
Profit/(Loss) Before Tax	10.621
Provision for Taxation	1.327
Profit/(Loss) After Tax	9.294
Export Value	286.869
Import Value	9.843
Total Expenditure	311.427

KEY RATIOS

PARTICULARS		31.03.2006	31.03.2005	31.03.2004
PAT / Total Income	(%)	NA	NA	2.75
Net Profit Margin (PBT/Sales)	(%)	NA	NA	3.15
Return on Total Assets (PBT/Total Assets}	(%)	NA	NA	5.64
Return on Investment (ROI) (PBT/Networth)		NA	NA	1.13
Debt Equity Ratio (Total Liability/Networth)		2.37	2.02	19.45
Current Ratio (Current Asset/Current Liability)		45.95	20.13	1.69

LOCAL AGENCY FURTHER INFORMATION

History

Subject originally established in year 1979 as a proprietory concern and converted into private limited company w.e.f. 26^th March 2003 having company registration number 139736

Business

To carry on the business of pharmaceuticals including manufacturing, wholesale, retail, locally and internationally, import and export, of tables, capsules, injections, liquids, packing and any other such products which are necessary in the field of pharmaceuticals.

Subject imports raw materials and exports pharmaceutical formulation.

FIXED ASSETS:

The company’s fixed assets of important value includes land, office premises, factory building, furniture and fixture, motor vehicles, plant and machinery, electrical installation, office equipments, computers and dies and punches.

Name of the company	MILAN LABORATORIES (INDIA) PRIVATE LIMITED
Presented By	State Bank of India, Kamothe, Panvel Branch, Panvel
1) Date and description of instrument creating the change	General agreement for the grant of Small Industrial Advances Against hypothecation of moveable, Book debts and other assets dated 30.01.2004 creating a single charge.
2) Amount secured by the charge/amount owing on the securities of charge	Rs. 58.500 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	All present and future goods, Book debts, movables and other assets such as outstanding moneys, receivables, claims, bills, invoices, documents, contracts, engagement, securities, investments and rights and present and all future machineries belonging to or in possession of the company or of the Bank or f third party whether in India or where throughout the world [Including all such goods, movables and other assets as may be in course of shipment / transit or delivery.]
4) Gist of the terms and conditions and extent and operation of the charge.	Interest : As determined by the Bank from time to time Margin : as prescribed by the bank from time to time.
5) Name and Address and description of the person entitled to the charge.	State Bank of India Kamothe [Panvel] Branch, Panvel, Maharashtra, India
6) Date and brief description of instrument modifying the charge	Agreement to Mortgage dated 30.01.2004
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 company agreed to create mortgage on its immovable properties comprising of Plots Nos. 63,67,35,36,64,65 & 87 in Jawahar co-operative Industrial Estate, Village Kamothe, Taluka Panvel, Raigad, admn in aggregate 4328.42 sq. maters together with buildings, structures an fixed plant and machineries thereon, to further secure the above charge of Rs. 58.500 Millions

Name of the company	MILAN LABORATORIES (INDIA) PRIVATE LIMITED
Presented By	State Bank of India, Kamothe, Panvel Branch, Panvel
1) Date and description of instrument creating the change	General agreement for the grant of Small Industrial Advances Against hypothecation of moveable, Book debts and other assets dated 30.01.2004 creating a single charge.
2) Amount secured by the charge/amount owing on the securities of charge	Rs. 58.500 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	All present and future goods, Book debts, movables and other assets such as outstanding moneys, receivables, claims, bills, invoices, documents, contracts, engagement, securities, investments and rights and present and all future machineries belonging to or in possession of the company or of the Bank or f third party whether in India or where throughout the world [Including all such goods, movables and other assets as may be in course of shipment / transit or delivery.]
4) Gist of the terms and conditions and extent and operation of the charge.	Interest : As determined by the Bank from time to time Margin : as prescribed by the bank from time to time.
5) Name and Address and description of the person entitled to the charge.	State Bank of India Kamothe [Panvel] Branch, Panvel, Maharashtra, India
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

AS PER WBSITE

Corporate Profile

Milân Laboratories (India) is a flourishing family enterprise which has been manufacturing and exporting pharmaceutical formulations for the last 27 years.

Founded in the year 1976 by Shri.M. M. Deshpande, the organization is growing multifold eversince , continually upgrading it's facilities , adding newer products and newer markets .

Their state of the art, WHO c GMP compliant manufacturing plant is situated at New Bombay and Head Office is at Thane.

Their company produces Tablets, General Capsules, Betalactam Capsules, Liquid orals, Ointments and Dry syrups in considerable quantities for the International Market. Injectables and soft gelatin Capsules are manufactured by them at different locations on loan licencee basis.

Their efficient Marketing set up has enabled them to penetrate the global market and the consistency in quality and timely deliveries have helped them to retain their esteemed international customers. Their products are registered in several countries. The organisation is a government recognized Export House .

They have absorbed competent, sincere and creative people in their organisation who continuously update their knowledge through seminars and technical forums.

Their Production and packaging departments boast of the latest technology and automation .Their Quality control laboratory is facilitated with sophisticated equipments.

Milân Laboratories (India) has always been regarded as an organization with a genuine attitude for Quality . Today they have several Quality certifications and awards to their credit.

The company on the whole is enthusiastic about moving ahead and they shall generate together, an excellent performance in the future too.

Accolades so far

Ø WHO cGMP certification

Ø SGS WHO cGMP certification (Belgium)

Ø ISO 9001 - 2000 certification (Orion USA)

Ø NAFDAC (Nigeria) approved

Ø FDB (Ghana) approved

Ø Export House Status

Ø Export Excellence award

Ø Rashtriya Udyog Award

Ø Udyog Ratan Award

Tablets

SR NO	COMPOSITION	SHELF LIFE (In Months)	PACKING
1.	Sulfamethoxazole BP 400 mg. , Trimethoprim BP 80 mg Tablet	36 / 48	10 X 10 BL 1 X 1000’C
2.	Ciprofloxacin Hydrochloride USP 500 Mg. Tablet	36	1 X 10 X 10’BL
3.	Chloroquine Phosphate USP 250 Mg Tablet	48	1 X 100’C
4.	Sulphamethoxazole B.P. 800 mg. Trimethoprim B.P. 160 mg Tablet	48	1 X 10 BL
5.	Ibuprofen B.P. 200 mg. Tablet	36	1 X 1000 C
6.	Sulphamethoxypyridazine 500 mg. , Pyrimethamine USP 25 mg. Tablet	36	1 X 2 X 25 S

Capsules Betalactam

1.	Ampicillin Capsules BP 250 mg.	36	1 X 10 X 10 BL
2.	Ampicillin Capsules BP 500 mg.	36	1 X 10 X 10 BL
3.	Amoxycillin Capsules BP 500 mg.	36	10 X 10 BL / 1 X 500 C
4.	Amoxycillin Capsule BP 250 mg	36	10 X 10 BL / 1X1000 C
5.	Cloxacillin Capsules BP 500 mg.	36	10 X 10 BL / 1 X 500 C
6.	Ampicillin Cloxacillin Capsules 500 Mg	36	10 X 10 BL

Capsules General

1.	Acetaminophen Capsules U.S.P. 500 Mg	36	10 X 10 BL
2.	MultiVitamin & Mineral Capsules Vitamin A Acetate USP 2000 I.U. , Thiamine HCL BP 10 mg., Riboflavin BP 3 mg , Pyridoxine HCL BP 6 mg. , Cyanocobalamine BP 10 mcg , Chloecalciferol BP 400 I.U. Ascorbic Acid BP 50 mg. , Nicotinamide BP 15 mg , Calcium Pantothenate BP 3 mg. , Folic Acid BP 0.6 mg. Vitamin E BP 10 mg Lysine HCL USP 50 mg Ferrous Fumarate BP 60 mg Calcium Lactate Pentahydrate BP 250 mg , Cupric Sulphate BP 0.3 mg , Zinc Sulphate BP 0.5 mg , Iodine BP 15 mg, Magnesium Sulphate BP 3.5 mg Manganese Chloride BP 0.5 mg Sodium Fluoride BP 0.5 mg.	24	1 X 3 X 10 S
3.	Ibuprofen BP 200 mg. , ParacetamolBP 325 mg. , Caffeine (anhydrous) BP 30 mg. Capsules	36	1 X 10 X 25 BL
4.	Tetracyclin Hydracloride BP 250mg Capsules	24	10 X 10 BL
5.	Piroxicam Capsules B.P. 20 mg.	36	10 X 10 BL

Oral liquids

1.	Pediatric Cotrimoxazole Oral Suspension B.P.	36	60 ML / 100 ML
2.	Amoxycillin Suspension BP 125 mg. / 5 ml	24	100 ML
3.	Ampicillin Dry Syrup BP 125 mg. / 5 ml	24	100 ML
4.	Metronidazole Benzoate B.P. 60/100 mg. , Furazolidone B.P. 30 mg. Suspension	36	60 ML
5.	Dried Aluminium Hydroxide B.P. 200 mg. , Magnesium Hydroxide B.P. 200 mg. , Simethicone BPC 25 mg. Suspension	36	200 ML

Lozenges

1.

Cough Lozenges Menthol B.P. 0.34 % w/w , Eucalytus BP 0.24 % w/w , Sucrose IP 73.1 % w/w , Methyl Paraben IP 0.09 % w/w

36

6 T x 2 x 10 x 50 BL

Ointments

1.	Clotrimazole Cream USP 1 % w/w	48	20 GM
2.	Precipitated Sulphur USP 10 % w/w, Mineral Oil USP 10 % w/w , White Ointment USP 80 % w/w Ointment	48	25 GM
3.	Methyl Salicylate BP 12.80 % w/w , Menthol BP 5.91 % w/w , Eucalyptus oil BP 1.97 % W/W , Turpentine oil BP 1.47 % Ointment	48	30 GM
4.	Diclofenac Diethylamine BP equi. to Diclofnac Sodium 1.00 % w/w	48	30 GM

Injectables

1.	Gentamycin	Gentamycin Injection USP 2 ml	36	50 X 2ML
2.	Vitamin B- Complex	Vitamin B- Complex Injection BP 10 ml	36	100 X 10ML

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	6
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	6
--RESERVES	1~10	6
--CREDIT LINES	1~10	6
--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	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		54

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