MIRA INFORM REPORT

Report Date :

03.01.2007

IDENTIFICATION DETAILS

Name :	LUBRIZOL INDIA PRIVATE LIMITED
Registered Office :	VIP House, 2^nd Floor, 88-C, Old Prabhadevi Road, Mumbai – 400025, Maharashtra
Country :	India
Financials (as on) :	31.12.2004
Date of Incorporation :	20.07.1966
Com. Reg. No.:	11-13538
CIN No.: [Company Identification No.]	U23201MH1966PTC013538
TAN No.: [Tax Deduction & Collection Account No.]	MUML04740B
PAN No.: [Permanent Account No.]	AAACL0126H
Legal Form :	Subject is a Private Limited Liability Company
Line of Business :	Manufacturing, Developing and Marketing of Chemical Additives systems for automotive and industrial Lubricants and Fuels.

RATING & COMMENTS

MIRA’s Rating :

Aa

RATING		STATUS	PROPOSED CREDIT LINE
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

Maximum Credit Limit :	USD 8000000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	The company is no more a Government of India company due to disinvestment. Subject is a well-established company. Available information indicates high financial responsibility of the company. Payments are always correct and as per commitments. The company can be considered good for normal business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	VIP House, 2^nd Floor, 88-C, Old Prabhadevi Road, Mumbai – 400025, Maharashtra, India
Tel. No.:	91-22-24300672/0784/1856/2315/24222062
Fax No.:	91-22-24300251/24370994/24366097
E-Mail :	pvs@lubrizol.com
Website :	1. http://www.petroleum.nic.in/lil.htm 2. http://www.lubrizolindia.com
Regional Office :	524/525, 5^th Floor, Core - 6, Scope Complex, Lodhi Road, New Delhi – 110 003, India
Tel. No.:	91-11-24361317
Fax No.:	91-11-24362879 / 24361629
Factory 1 :	9/3, Thane Belapur Road, Turbhe, District Thane, Navi Mumbai – 400 705, Maharashtra, India
Tel. No.:	91-22-27672568
Fax No.:	91-22-27672155
Factory 2 :	T-6, MIDC, Industrial Area, Taloja, District Raigad, Maharashtra, India
Tel. No.:	91-22-27410813
Fax No.:	91-22-27410910
Branches :	Y Apeejay Business Center, Apeejay House, 12, Haddows Road, Nungambakkam, Chennai – 600 006 Tel: 91-44-28224949 Y Temple Tower, 2^nd Floor, Nandanam, 476, Anna Salai, Chennai – 600 035, Tamilnadu Tel. 91-44-24346451 Fax. 91-44-24330943 Y Room No. 7, 6^th Floor, Shantiniketan, 8, Carnac Street, Kolkata – 700 017, West Bengal Tel. 91-33-22824063 Fax. 91-33-22825782

DIRECTORS

Name	Dr. John Battersby
Designation	Chairman & Managing Director
Date of Birth	11.03.1945
Name	Mr. John A. Thomas
Designation	Director
Date of Birth	02.07.1938
Name	Mr. Jawahar L. Zutshi
Designation	Director
Address	K -33, Green Park, New Delhi – 110016
Date of Birth	04.01.1937
Date of Appointment	31.03.2000
Name	Mr. James Hambrick
Designation	Director
Date of Birth	06.02.1955
Name	Mr. Ramchandra Seshamani
Designation	Director
Date of Birth	26.02.1945
Name	Mr. Banshi D. Soni
Designation	Whole Time Director
Address	A- 172, Twin Towers, Veer Savarkar Marg, Mumbai – 400025, Maharashtra, India
Date of Birth	26.06.1945
Date of Appointment	03.04.2001
Date of Ceasing	30.06.2005
Election Commission Identity Card No. :	DL/03/031/027011
Name	Mr. Dilip Ramchandra Teredesai
Designation	Managing Director
Address	301, Royal Accord, 15, Gokhale Road [North], Dadar, Mumbai – 400028, Maharashtra, India
Date of Birth	18.05.1947
Date of Appointment	01.04.2002
Name	Mr. Madhukar Ramniklal Jethalal Kumbhani
Designation	Whole Time Director
Address	Mumbai – 400049, Maharashtra, India
Date of Birth	04.02.1950
Date of Appointment	01.04.2002
Name	Mr. Darius C. Shroff
Designation	Director
Address	Moonlight, Flat No. 8, 158, M. Karve Road, Churchgate, Mumbai – 400020, Maharashtra, India
Date of Birth	08.08.1944
Date of Appointment	01.04.2002
Election Commission Identity Card No.	MT/04/019/261274
Name	Mr. Sugavanam Padmanabhan
Designation	Director
Address	C – 370, Defence Colony, New Delhi – 110026
Date of Birth	03.06.1945
Date of Appointment	08.04.2002
Name	Mr. Gregory R. Lewis
Designation	Director
Name	Mr. Nirmalendu Kshetra Mohon Biswas
Designation	Whole Time Director
Address	42, Vikas Finlay Tower, Lower Parel, Mumbai – 400033, Maharashtra, India
Date of Birth	14.02.1947
Date of Appointment	01.07.2005
Name	Mr. Narasimhan Varadarajan Serangulam
Designation	Director
Address	835, Asiad Village, New Delhi – 110016
Date of Birth	07.04.1951
Name	Mr. Brij Mohan Shyam Sunder Bansal
Designation	Director
Address	837, Asiad Village, New Delhi – 110049, India
Date of Birth	04.01.1951
Date of Appointment	25.10.2005
Name	Mr. David James Fries
Designation	Director
Address	The Lubrizol Corporation, 29400 Lakeland Boulevard Wickliffe, Ohio, U.S.A.
Date of Birth	14.02.1959
Date of Appointment	22.07.2004
Name	Mr. Biswas Kshetramohon Nirmalendu
Designation	Whole Time Director
Address	42, Vikas Finlay Tower, Lower Parel, Mumbai – 400033, Maharashtra, India
PAN No.	00237378
Name	Mr. Vinod Ram Sharma
Designation	Director
Address	Flat No. 7 [South Block], B. K. Apartment, B – 17 C, Nichols Road, Chetpet, Chennai – 600031, Tamilnadu, India
PAN No.	00399310

KEY EXECUTIVES

Name	Mr. R. T. Goel
Designation	Company Secretary
Name	Ms. Indulekha Nitin Godse
Designation	Secretary
Address	JN – 4/10/14, Blue Haven, Sector 10, Vashi, Navi Mumbai – 400703, Maharashtra, India
Date of Birth	02.09.1963
Date of Appointment	01.12.2004

MAJOR SHAREHOLDERS

Names of Shareholders	No. of Shares	Percentage of Holding
The Lubrizol Corporation	960000	50
Indian Oil Corporation Limited	960000	50
Total	1920000	100

BUSINESS DETAILS

Line of Business :	Manufacturing, Developing and Marketing of Chemical Additives systems for automotive and industrial Lubricants and Fuels.
Products :	· Engine Oil – Additives · Viscosity Index- Improvers and Pour Point Depressant · Industrial Oil – Additives Product Code No. 38.1100
Brand Names :	“ Lubrizol”

PRODUCTION STATUS

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual production
Chemical additives inclusive of : Dispersant Additives, Extreme	MTPA	47000	60000	31796
Raw materials (Isobutylene)	ML	3000	3000	--

GENERAL INFORMATION

No. of Employees :	Around 699
Bankers :	· State Bank of India Mumbai, Maharashtra · Bank of India Mumbai, Maharashtra · ICICI Bank Limited Mumbai, Maharashtra

Banking Relations :	Good
Auditors :	Deloitte Haskins & Sells Chartered Accountants Plot No. 12, Dr. Annie Besant Road, Opp Shivsagar Estate, Worli, Mumbai-400018, Maharashtra, India
Parent Company / Joint Venture:	Lubrizol Corporation, U.S.A. Indian Oil Corporation Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
19,20,000	Equity shares	Rs. 100/-	Rs. 192.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
19,20,000	Equity shares	Rs. 100/-	Rs. 192.000 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.12.2004 (12 Months)	31.12.2003 (9 Months)	31.03.2003 (12 Months)
SHAREHOLDERS FUNDS
1] Share Capital	192.000	192.000	192.000
2] Reserves & Surplus	1861.645	1836.613	1811.898
NETWORTH	2053.645	2028.613	2003.898
LOAN FUNDS
1] Secured Loans	0.000	0.000	0.000
2] Unsecured Loans	0.044	0.045	0.048
TOTAL BORROWING	0.044	0.045	0.048
DEFERRED TAX LIABILITIES	124.431	126.568	158.653
TOTAL	2178.120	2155.226	2162.599
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]	776.985	826.580	847.336
Capital work-in-progress	42.585	20.235	15.218
CURRENT ASSETS, LOANS & ADVANCES
Inventories	809.232	790.248	715.167
Sundry Debtors	481.996	321.620	385.073
Cash & Bank Balances	383.947	215.943	219.648
Loans & Advances	197.225	241.487	215.060
Total Current Assets	1872.400	1569.298	1534.948
Less: CURRENT LIABILITIES & PROVISIONS
Current Liabilities	295.669	226.669	196.395
Provisions	280.480	83.151	120.398
Total Current Liabilities	576.149	309.820	316.793
Net Current Assets	1296.251	1259.478	1218.155
MISCELLANEOUS EXPENSES	62.299	48.933	81.890
TOTAL	2178.120	2155.226	2162.599

PROFIT & LOSS ACCOUNT

PARTICULARS	31.12.2004 (12 Months)	31.12.2003 (9 Months)	31.03.2003 (12 Months)
Sales Turnover [including other income]	2751.460	2325.476	3429.349
Profit/(Loss) Before Tax	380.105	262.865	638.495
Provision for Taxation	137.981	81.115	230.777
Profit/(Loss) After Tax	242.124	181.750	407.718
Export Value	130.244	73.938	282.557
Import Value	641.343	521.620	681.118
Total Expenditure	2371.355	2062.611	2790.854

KEY RATIOS

PARTICULARS		31.12.2004 [12 Months]	31.12.2003 (9 Months)	31.03.2003 (12 Months)
PAT / Total Income	(%)	8.79	7.82	11.88
Net Profit Margin (PBT/Sales)	(%)	13.81	11.30	18.62
Return on Total Assets (PBT/Total Assets}	(%)	14.34	10.97	26.63
Return on Investment (ROI) (PBT/Networth)		0.18	0.13	0.32
Debt Equity Ratio (Total Liability/Networth)		0.28	0.15	1.23
Current Ratio (Current Asset/Current Liability)		3.24	5.07	4.84

LOCAL AGENCY FURTHER INFORMATION

HISTORY

Subject was incorporated on 20^th July, 1966 at Mumbai in Maharashtra having Company Registration Number 13538.

The company started its operations in 1969 with a blending plant where imported intermediates were blended to manufacture finished additives. Over a period time of the company with active assistance and guidance of the Collaborators and the Government of India, the company set up manufacturing facilities for indigenous manufacture of all high volume additives.

Subject was incorporated in 1966 in collaboration with the Lubrizol Corporation, USA (LC) world leaders in additive business. 60% of the subscribed equity capital of the company was held by the Government of India and the balance 40% of by LC. In line with Government of India's decision to divest its entire equity of 60% in the company, the shares held by Government of India were transferred to Indian Oil Corporation Limited on 31^st March, 2000, who in turn transferred 10% of LC on the same day. Thus at the close of the financial year 1999-2000, the company become a joint venture between LOC and LC.

The company was awarded the Certificate of Merit by CHEMEXCIL (Basic Chemicals, Pharmaceuticals and Cosmetics Export Promotion Council) for outstanding Export performance during 1993-94.

The company was awarded the Oil Industry Safety Award for the years 1993-94 and 1994-95 for having achieved the best Overall Safety Performance amongst PSUs in the Petroleum Sector (Refinery Installation).

Recently, the company has become a private limited liability company.

FIXED ASSETS

Leasehold Land, Buildings, Plant and Machinery, Electrical Installations, Furniture and Fixtures, Office Appliance, canteen and other Equipment, vehicles

Profile

Additives are complex synthetic chemicals which are added to petroleum fuels and lubricants to achieve the desired end use applications. Present day automotive and industrial oils owe their performance mainly to the chemical additive system added to them. The additive packages have components which perform certain distinctive functions such as detergency, dispersancy, oxidation stability, anti wear property, rust and corrosion inhibition, viscosity index improvement, etc. For each of these basic functions, there are many different approaches requiring different chemicals or combination of chemicals that may provide the necessary performance characteristics. Chemical additives are also used for improving the flow characteristics of crude oil and petroleum products.

LIPL develops, manufactures and markets Additive Systems for Automotive and Industrial Lubricants and for the treatment of Fuels. LIPL's main production unit is situated at Trans Thane-Belapur Industrial Complex near Navi Mumbai. The manufacturing operations of the company have received ISO-9002 and ISO 9001-2000 Certification from the Bureau Veritas Quality International as well as ISO-14001 and accreditation by implementing a comprehensive Environmental Management System.

LIPL was initially incorporated as a 'Private Limited' Company. By virtue of Section 43-A of the Companies Act, it became a Deemed Public Limited Company with effect from 27^th December 1966. The Companies (Amendment) Act, 2000 (effective 13^th December 2000), abolished the concept of 'Deemed Public Company', and accordingly, LIPL reverted to a 'Private Limited Company' with effect from 13^th March 2001.

LIPL is one of the very few companies outside U.S.A. and Europe with comprehensive manufacturing infrastructure for the development and production of fuel and lubricant additives.

The management control of the company with The Lubrizol Corporation (NYSE:LZ) who is a global provider of speciality additives and fluid technologies. These high performance technologies focus on chemicals, systems and services for transportation and industry .The company's customers use its technology to enhance a wide variety of end use products, including engine lubricants and fuel; gear oil and other vehicle related fluids; haudralic fluids and emission control systems; greases and industrial fluids; personal care products and industrial cleaners; paints, coating and inks; and mining chemicals. Lubrizol was founded in 1928 and owns and operates 34 manufacturing plants in 15 countries. The Wickliffe, Ohio based company has 50 Sales and Technical offices and more than 5000 employees work-wide. Its three research centres are located in Wickliffe, Ohio, Hazelwood, England and Kinuuva, Japan.

The company manufactures different types of Metallic Antioxidants, Overbased Sulphonates of Calcium, Overbased Phenates of Calcium, Engine Oil Dispersants, Viscosity Index Improvers, Lube Pour Point Depressants, Magnesium Sulphonate Detergents, High Base Phenate Detergent and Extreme Pressure Additive Components for Gear Oil.

Subject is speciality chemical company serving the needs of the Petroleum Industry. The company develops, manufactures and markets additive systems for automotive and industrial lubricants and for treatment of fuels. The company is one of the handful of companies outside USA having technology for development, manufacture and engine evaluation of major engine lubricant oils. The company is actively participating in the Government’s of drive for reducing the consumption of petroleum, fuel and lubricants.

The company's efforts were well-directed towards consolidating the established ISO-9002 Quality Management System. Both the Manufacturing Units of the Company have received ISO-9002 Certification from the Bureau Veritas Quality International.

The company receives assistance from Oil Industry Development Board (OIDB) in the form of unsecured long-term loans as Extra Budgetary Support to finance its Plan Expenditure as approved by the Planning Commission.

The company’s additive packages to improve fuel economy and control deposits, sludge, varnish, rust, corrosion, wear, viscosity, oxidation an cold temperature flow in oils meeting industry and original equipment manufacturers specifications worldwide.

The company’s performance chemistry to control piston deposits, lacquer, soot, oxidation, sludge, wear and oil consumption in oils meeting industry and original equipment manufacturers specifications worldwide.

The company's product range includes:-

· Chemical Additives Packages for Motor Oil

· Commercial Diesel Engine Oil

· Railroad Oil

· Marine Diesel Oil

· Gear Oil

· 2-Stroke Engine Oil

· Passenger Car Motor Oils

· Marine Diesel Engine Oils

· Automotive & Industrial Gear Oils

· Fuel Products

· Heavy-Duty Engine Oils

· Stationary Gas Engine Oils

· Tractor Fluids

· Antiwear Hydraulic Fluids

· Two-Stroke Engine Oils

· Automatic Transmission Fluids

· Off-Highway Equipment

· Metalworking Fluids

Transmission Fluid and other Industrial Oils against laid down International Specifications, Additives for transportation and treatment of fuels.

The company's Research and Development Centre is recognized by the Department of Scientific and Industrial Research, Ministry of Science & Technology, Government of India.

The company has received the national award for in-house R & D Efforts for the year 1991 in Pharmaceutical, Biological and Chemical Industry sector from Department of Scientific and Industrial Research. The award was presented for the development of two polymeric additives, pour point depressant (PPD) and viscosity index improver (VII), which had been successfully commercialized by the company starting from laboratory development work, subsequent pilot plant studies and leading ultimately to setting up of the VII / PPD manufacturing plant.

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. 44.42
UK Pound	1	Rs. 86.61
Euro	1	Rs. 58.46

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	7
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	7
--LEVERAGE	1~10	7
--RESERVES	1~10	8
--CREDIT LINES	1~10	7
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	NO
--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		62

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