MIRA INFORM REPORT

Report Date :

06.06.2007

IDENTIFICATION DETAILS

Name :	THE INDIAN CARD CLOTHING COMPANY LIMITED
Registered Office :	Mumbai-Pune Road, Pimpri, Pune-411018, Maharashtra
Country :	India
Financials (as on) :	31.03.2006
Date of Incorporation :	24.06.1955
Com. Reg. No.:	9579
CIN No.: [Company Identification No.]	L29261PN1955PLC009579
Legal Form :	Public Limited Liability Company. Company’s shares are listed on Stock Exchanges.
Line of Business :	Manufacturer and Marketing Card Clothing and also Servicing Card Clothing

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 2700000
Status :	Satisfactory
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well-established and reputed company having satisfactory track. Directors are reported as experienced and respectable businessmen. Trade relations are reported as fair. Business is active. Payments are usually correct and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office/ Factory :	Mumbai-Pune Road, Pimpri, Pune-411018, Maharashtra, India
Tel. No.:	91-20-2411145/27425390
Fax No.:	91-20-27477531
E-Mail :	accounts@cardindia.com
Website :	http://www.cardindia.com
Factory 1 :	Coimbatore 524, Avanashi Road, Peelamedu, Coimbatore – 641004
Tel. No.:	(422) 2561458, 2561459, 2567858
Fax No.:	(422) 2561459
E-Mail :	icccbe@cardindia.com
Factory 2 :	Madurai Alagamma Garden, 19, Sengolnagar, Vilangudi, Madurai - 625018
Tel. No.:	(452) 2668071, 2668330, 2668480
Fax No.:	(452) 2668480
E-Mail :	iccmdu@cardindia.com
Branches :	Located at : v Ahmedabad v Coimbatore v Hyderabad v Kolkata v Ludhiana v Madurai v Mumbai v New Delhi v Panipat v Salem
Tel. No.:
International Agents :	Located at : Australia Bangladesh Sri Lanka Hong Kong Taiwan Indonesia Iran Morocco Thailand Phillipines Vietnam Sri Lanka Syria Africa Egypt South Africa Portugal Bulgeria/ Poland/ Hungery Turkey USA Peru Brazil

DIRECTORS

Name :	Mr. K K Trivedi
Designation :	Chairman
Name :	Mr. Prashant K Trivedi
Designation :	Deputy Chairman
Name :	Mr. M K Trivedi
Designation :	Managing Director
Name :	Mr. H C Asher
Designation :	Director
Name :	Mr. M M Shah
Designation :	Director
Name :	Mr. J M Kothary
Designation :	Director
Name :	Mr. C M Maniar
Designation :	Director
Name :	Mr. Sudhir Merchant
Designation :	Director

KEY EXECUTIVES

Name :	Mr. A D Dahotre
Designation :	Vice President (Finance) and Company Secretary
Name :	Mr. U V Bhave
Designation :	Vice President (Human Resources)
Name :	Mr. N Jain
Designation :	Vice Presidetn (Sales and Marketing)
Name :	Mr. U S Borkar
Designation :	General Manager (Materials)
Name :	Mr. A B Pawar
Designation :	General Manager (Production)

SOLE PROPRIETOR/PARTNERS/DIRECTORS

Category of Share Holders	Total No. of Shares	Percentage of shareholding
Non Resident Individuals. Foreign nationals
Bodies Corporate	2610166	57.35
Institutions
Any Other (specify)
Sub-Total	2610166	57.35
Total holding of Promoter and Promoter Group	2610166	57.35
Public Shareholdings3
Institutions
Mutual Fund/UTI	1800	0.04
Financial Institutions/Banks	425	0.01
Insurance Companies	15050	0.33
Sub Total	17275	0.38
Non Institutions
Bodies Corporate	262900	5.78
Individuals
i) Holding nominal share capital upto Rs. 1 lakh	1500004	32.96
ii) Holding nominal share capital in excess of Rs. 1 lakh	134308	2.95
Any Other(specify)
i) Non Resident Individuals	26467	0.58
Sub Total	1923679	42.27
Total Public shareholding	1940954	42.65
Total	4551120	100.00
Shares held by Custodians and against which Depository Receipts have been issued	0	0.00
GRAND TOTAL	4551120	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer and Marketing Card Clothing and also Servicing Card Clothing

Products :

Products	Item Code
Card Clothing	844831.00

PRODUCTION STATUS

Particulars	Unit	Installed Capacity	Actual Production
Flexible and Metallic Card Clothing	Sets	8000	5138
Woollen, Worsted, Cotton Waste and asbestos card clothing and raising fillets and sheets	Meters	450000	162588
Accura Fixed Flats	Nos.	28800	30159

GENERAL INFORMATION

Bankers :	Ø Corporation Bank Ø HDFC Bank Limited Ø ICICI Bank Limited
Facilities :	Secured Loans : Bank overdraft secured by pledge of fixed deposits : Rs.13.459 millions

Banking Relations :	Satisfactory
Auditors :
Name :	B. K. Khare and Company Chartered Accountant
Address :	706/708, Sharda Chambers, New Marine Lines, Mumbai-400002, Maharashtra, India
Associates/Subsidiaries :	Ø Acre Street Investments (Mauritius) Limited Ø ICC Investment and Finance Consultants Limited Ø ICC International Agencies Limited Ø Garnett Wire Limited Ø Kardhar Construction Limited Ø Multi Act Trade and Investments Private Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
5000000	Equity Shares	Rs.10/- each	Rs.50.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
4551120	Equity Shares	Rs.10/- each	Rs.45.511 millions

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		45.511	45.511	45.500
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		637.102	548.421	502.900
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		682.613	593.932	548.400
LOAN FUNDS
1] Secured Loans		13.459	12.411	8.300
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		13.459	12.411	8.300
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		696.072	606.343	556.700
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		82.871	91.507	93.600
Capital work-in-progress		210.135	57.850	1.200
INVESTMENT		205.337	327.421	378.600
DEFERREX TAX ASSETS		2.584	1.661	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	107.616	89.608	68.600
	Sundry Debtors	84.883	99.718	66.600
	Cash & Bank Balances	74.579	21.548	19.500
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	45.630	54.924	45.900
Total Current Assets		312.708	265.798	200.600
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	94.542	118.492	75.400
	Provisions	23.021	19.402	41.900
Total Current Liabilities		117.563	137.894	117.300
Net Current Assets		195.145	127.904	83.300
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		696.072	606.343	556.700

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2006	31.03.2005	31.03.2004
Sales Turnover		467.191	465.753	368.200
Other Income		147.508	83.396	69.300
Total Income		614.699	549.149	437.500
Profit/(Loss) Before Tax		186.736	141.583	116.500
Provision for Taxation				18.300
Profit/(Loss) After Tax		504.464	423.752	98.200
Earnings in Foreign Currency :
	Export Earnings	87.503	77.747	NA
	Other Earnings	1.903	1.531	NA
Total Earnings		89.406	79.278	NA
Imports :
	Raw Materials	27.247	27.722	NA
	Stores & Spares	1.406	2.257	NA
	Capital Goods	29.893	0.000	NA
	Others	1.688	0.981	NA
Total Imports		60.234	30.960
Expenditures :
	Manufacturing Expenses	NA	NA	24.100
	Administrative Expenses	NA	NA	41.500
	Raw Material Consumed	NA	NA	124.400
	Miscellaneous Expenses	NA	NA	17.100
	Salaries, Wages, Bonus, etc.	NA	NA	84.300
	Interest	0.093	0.132	0.100
	Power & Fuel	NA	NA	15.300
	Depreciation & Amortization	14.103	14.707	14.700
	Other Expenditure	413.767	392.727	(0.500)
Total Expenditure		427.963	407.566	835.529

SUMMARISED RESULTS

PARTICULARS	31.03.2007 (Full year)
Sales Turnover	455.200
Other Income	182.200
Total Income	637.400
Total Expenditure	418.300
Operating Profit	219.100
Interest	0.100
Gross Profit	219.000
Depreciation	23.600
Tax	32.300
Reported PAT	163.100
Dividend (%)	1250.000

KEY RATIOS

PARTICULARS	31.03.2006	31.03.2005	31.03.2004
Debt-Equity Ratio	0.02	0.02	0.02
Long Term Debt-Equity Ratio	0.00	0.00	0.00
Current Ratio	2.06	1.69	1.69
TURNOVER RATIOS
Fixed Assets	1.71	1.68	1.14
Inventory	5.43	6.79	5.55
Debtors	5.80	6.46	5.34
Interest Cover Ratio	672.00	883.00	740.00
Operating Profit Margin(%)	15.18	19.17	24.09
Profit Before Interest And Tax Margin(%)	12.55	16.44	20.10
Cash Profit Margin(%)	12.10	15.19	20.94
Adjusted Net Profit Margin(%)	9.47	12.45	16.95
Return On Capital Employed(%)	10.32	15.18	13.86
Return On Net Worth(%)	7.94	11.71	11.89

STOCK PRICES

Face Value	Rs.10.00/-
High	Rs.169.25
Low	Rs.172.75

LOCAL AGENCY FURTHER INFORMATION

HISTORY

Subject was incorporated on 24^th June, 1955 at Pune in Maharashtra having Company Registration Number 74692.

Subject was incorporated in July, 1955 as a private limited company. it was converted into a public limited company in January, 1976. Subject was promoted as a joint venture between two British Companies- The English Card Clothing Company and the Carclo Engineering Group.

Subject manufactures card clothing suitable for all types of fibers requiring carding, ie. all the natural fibres and manmade fibres in staple form. It also has a 100% EOU at Ahmedabad. The company came out with a rights issue (Premium : Rs. 70) aggregating Rs. 104 millions in December, 1993., to provide for normal capital expenditure and participated in a joint venture with Spindelfabrik Suessen Schurr, Stahlecker & Grill, Germany, which it had undertook to manufacture of textile machinery equipment.

Due to recession in textile industries in the Domestic and Overseas market, subject diversified its project and participated in Joint Venture with Texmaticc India Limited and invested Rs. 2.500 millions. The Residential housing project of Nirvan Builders and Developers Limited in which company participated and received advance for sale of major part of its investment in project. Garnett Wire Limited, a U.K. company, in which ICCCL has 60% of issued share capital, this is second year of investment by the ICCCL.

Subject has maintained ISO 9002 recognition by Bureau Veritas Quality International for Metallic and flexible card clothing and R and D Centre begun to make a contribution to development of newer and improved products and processes.

Subject is planning to develop new products for carding applications and also improvement in the processes.

BUSINESS

Subject is engaged in the business of Manufacturing and Marketing of Card Clothing and also Servicing Card Clothing.

OPERATIONS-HIGHLIGHTS

The Company's Sales and Servicing Income for the year was Rs.471.699 millions as compared to Rs. 471.252 millions in 2004-05.

Sale of metallic card clothing registered growth of 11.25% during the year to Rs.296.435 millions from Rs.266.466 millions in the previous year as a result of higher demand for the Company's products. Sales of woollen card clothing decreased by 41.18% during the year to Rs.724.80 from Rs. 1232.23 millions in the previous year due to decreased demand from woollen sector. Exports increased by 12.55% to Rs.875.03 millions during the year from Rs.77.747 millions in the previous year.

Other Income includes Rs.298.18 millions of gain as a result of the acquisition of 9,225 square metres land by the Pimpri Chinchwad Municipal Corporation for road widening during the year 2005-06. Capital work in progress includes a commercial building under construction of Rs. 133.668 millions and the project for manufacture of card clothing in Himachai Pradesh of Rs.75.035 millions as at 31^st March, 2006.

SUBSIDIARY COMPANIES

ICC International Agencies Ltd. recorded an increase in income of 42.71% from Rs.33.593 millions in the previous year to Rs.47.940 millions in the current year. The subsidiary company recorded profit after tax of Rs.16.801 millions in the current year against previous year's profit after tax of Rs.46.87 millions. The higher profit after tax was mainly on account of higher commission income and marginal improvement in income from traded goods. ICC International Agencies Limited paid a dividend of 40% (previous year 15%).

Garnett Wire Ltd.(GWL), a U.K. Company, in which the Company has 60% of the issued share capital, reported higher turnover and consequently improved profit after tax of PDS 68,2451- against PDS 12,520/- in the previous year. GWL declared dividend of 11.43%. Higher sale of card clothing to US market and increased servicing activity in UK contributed to improved profitability of GWL.

Industry Structure and Development

Although the global card clothing industry remains fragmented the pace of consolidation has increased somewhat. Following the sale by Carclo pic of its card clothing interests worldwide to N.V. Bekaert S.A. last year, N.V. Bekaert S.A. within the last 12 months also acquired Damgaard GmbH, another manufacturer of card clothing for woollen, worsted and non-woven applications. Whilst, Graf + Cie AG, the leading manufacturer of card clothing based in Switzerland was sold to Reiter AG, a Swiss manufacturer of textile machinery, including carding

machines. Patentes Plait S.A. a Spanish manufacturer of metallic card clothing ceased operations in 2005 and the Company acquired some of the assets with a view to setting up an additional plant in Himachal Pradesh.

As a result of the consolidation in the last two years, two manufacturers of carding machines, Trutzschler GmbH and Reiter A.G. now own two major manufacturers of card clothing, Hollingsworth GmbH and Graf+ CieAG respectively.

Within India, there are still only two major manufacturers of card clothing for short staple application viz., the Company and Lakshmi Card Clothing Company Limited. N.V. Bekaert S.A. through its acquisition of the assets of English Card Clothing Co. Limited, a subsidiary of Carclo pic has a small tops manufacturing plant in Pune, and Trutzschler GmbH has a small facility to manufacture flexible card clothing for cotton application, inAhmedabad. Trutzschler GmbH has not yet commenced commercial production at its Ahmedabad plant.

Chinese Textile machinery manufacturers have set up sales offices in India and Chinese card clothing manufacturers have appointed agents at various locations in India with a view to exploiting the buoyant Indian textile industry.

Cotton Textile mills in the private sector are continuing to show robust growth in sales of yarn and fabric and a planning to increase capacity in spinning. The process is likely to continue for at least 3 to 5 years.

The woollen textile industry in India involved in the processing of regenerated fibre continues to be dominated by small scale manufacturers. Over the last 8 months it has experienced a significant downturn in demand following 18 months of significant growth. The demand for both yarn from regenerated fibres and virgin wool has shown a significant dip.

Opportunities

Growth:

Production of cotton yarn for the year 2005-06 at 2472 million kgs. has shown an increase of 8.8% over the previous year's production of 2271 million kgs. Whilst production of blended yarn for the year 2005-06 at 582 million kgs. has remained flat over the previous year's production of 584 million kgs. Increased consumption of staple fibre has a positive co-relation with the demand for card clothing.

The textile industry in India is in the process of capacity expansion to cater for the increased demand from overseas markets, particularly the United States of America and the European Union. The industry is expected to invest in additional spinning capacity. It is estimated that 3 million spindles will added per annum for the next five years, which will increase the demand for card clothing.

Exports

In addition to growth in the Indian textile industry, the Company is concentrating its sales and service effort in those overseas markets, which have benefited or are expected to benefit from the liberalised trading regime in textiles. The Company is competing with European manufacturers on cost competitiveness and after sales service and with Chinese on the basis of better technology.

Brand

Efforts are continuous to ensure that the positive "ICC" brand image is reinforced.

This is being done by new product introductions, improvements in service levels and continuous improvements in quality.

Threats

The ability of two of the major carding machine manufacturers to provide card clothing in the re-clothing market poses a threat that the Company will have to counter by providing better quality products at competitive prices and efficient aftersales service.

The inability of suppliers of components of Accura and other service machinery to make timely deliveries poses an additional threat, which the Company is countering by developing more vendors.

Operations

The Company's main business is the manufacture and marketing of card clothing.

In light of the improved conditions in the cotton textile industry, the Company recorded an increase in turnover of 11.25 percent in cotton card clothing but registered a decline in woollen card clothing of 41 per cent resulting in a decrease in gross profit from operations by 45 percent.

Demand for cotton card clothing was in the higher end of the market, resulting in increased unit price realisation. Demand for better quality yarn required textile mills to invest in card upgradation products like Accura Carding elements and Accura Beater segment and the need to maintain the card clothing at optimum levels of performance meant that many quality conscious mills invested in the Company's Sharprite, wire sharpening device and Sharprite Tops, its tops resharpening and cleaning device.

In view of increased demand for cotton card clothing, efforts have been initiated to enhance operating efficiency, including re-training manpower and introducing flexibility in manning depending on skills.

The above efforts are expected to result in supply of better quality products.

A decline in demand for woollen card clothing was principally due to a fall in the number of new woollen carding machines installed during the fiscal year 2005- 2006. In addition, the entry of Chinese card clothing in a few woollen mills also affected the demand for the Company's products.

To counter the decrease in new installations of woollen carding machines, the Company has introduced a new retrofit product capable of being installed on every woollen card to improve the life and efficiency of the card clothing.

Outlook

The growth and profitability of care clothing business is highly dependent on the performance of the textile industry and yarn, being a global commodity, depends on market forces and the overall global economic outlook. The Company hopes to further improve its operations by:

(a) making further improvements in the quality of its products;

(b) continuing to introduce new products which will increase the product portfolio of the Company and meet the requirements of the Company's existing and potential customers;

(c) improving productivity in the manufacturing processes and,

(d) reducing costs.

The manufacturing plant of the Company has ISO 9001 certification and this is

renewed from time to time.

Sale of metallic card clothing for the cotton textile industry has registered increase of 11.2%. Trading conditions in the cotton textile industry have shown improved recovery. The Company's products of better quality were received with higher demand during the year.

The sale of Accura Fixed Flats increased due to higher sale of Accura assemblies. An Accura assembly is a retrofit device placed on a carding machine and is a "one time" sale.

Increased sale of Sharprite, Sharprite Tops and Accura Beater Segments for blow rooms resulted in an improvement in the sales shown under "Others".

Exports have shown growth on account of higher demand in overseas market.

The company’s fixed assets of important values include Land, Buildings, Plant and Machinery, Electrical Installations, Air Conditioning, Plant and Machinery, Furniture and Fitting, Office Equipments and Computers and Vehicles.

Particulars	31.03.2006	31.03.2005
i) Claims against the Company not acknowledged as debts	7.760	9.830
ii) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances)	7.436	70.135
iii) Contingent liability in respect of taxation matters in appeal by the Department	1.674	1.674

Subject was incorporated in Jul.'55 as a private limited company. It was converted into a public limited company in Jan.'76. The company was promoted as a joint venture between two British companies -- The English Card Clothing Company and the Carclo Engineering group.  

Subject manufactures card clothing suitable for all types of fibres requiring carding, ie, all the natural fibres and manmade fibres in staple form. It also has a 100% EOU at Ahmedabad. The company came out with a rights issue (premium : Rs 70) aggregating Rs 10.4 cr in Dec.'93, to provide for normal capital expenditure and participated in a joint venture with Spindelfabrik Suessen Schurr, Stahlecker & Grill, Germany, which it had undertook to manufacture of textile machinery equipment.  

Due to recession in textile industries in the Domestic and Overseas market, the company diversified its project and participate in a Joint Venture with Texmaticc India Ltd, and invested Rs 2.5 Millions. The Residential housing Project of Nirvan Builders and Developers Ltd. in which company particiapted & received advance for sale of major part of its investment in project. Garnett Wire Ltd, a U.K. Company, in which ICCCL has 60% of issued share capital, this is second year of investment by the subject.

The company has maintained ISO 9002 recognition by Bureau Veritas Quality International for Metallic and flexible card clothing & R & D Centre begun to make a contribution to development of newer and improved products and processes. 

The company is planning to develop new products for carding applications and also improvement in the processes.

Website Details :

Subject has mastered change to keep its position as a leader. With products developed to handle the evolving needs of increased rate of outputs – going as high as 150 kg/hour. And to meet more exacting quality standards worldwide. Innovation has become an ongoing process at subject. A state-of-the-mind instilled in every employee, in every department, in every stage of the production process.

The result. A wide range of wires, tops and flexible card clothing. To suit every requirement, depending on the type of fibre being processed and the quality parameters desired. In fact, subject is one of the few companies in the world that manufactures card clothing to process every fibre. Natural or man made. On every type of carding machine, be it conventional cards or super high production cards.

The R&D Cell at subject is constantly tuned to market needs. Experimenting with fresh ideas and technologies. Making significant breakthroughs in tooth geometry, surface treatment, etc, Recent developments include special alloy steel wires in the Tenace series, a new generation of Triumph Tops and specially developed AeroDoffer Wires for better doffing.

Thanks to team efforts, ICC now has a line of Card Upgrade Products which aim at adding carding efficiency to older cards. Subject's Web Catcher and Accura Carding Elements have added significantly to the returns at hundreds of mills, where they have been installed in the last couple of years. More such innovations are on the testing line.

News :

Issue Two :

ICC and Garnett Wire celebrate decade of Carding Innovation

Enduring Performance and Reliability- Introducing The Endura Range

ITME 2000 Success

Essential Fancy Design

Soma relies on ICC for Consistent Quality

Carding the World-Great Export Success

Issue One

A Global Force In Carding -ICC and Garnett Wire form worldwide partnership

Global Communication-Launch of ICC website

Breathing New Life Into Old Cards-Accura enchances Carding efficiency

ITME2000- See ICC's product showcase

Increased Production Rates-Enchanced quality with Tenace wires

In-House Quality Assurance-Focus on ICC Tool Room

ICC Around The World- Spotlight on new export markets

Outstanding Commitment To Quality- Profiles of ICC and Quality Control Division

Trumac Machinery Manufacturer - ICC and Trumac partnership

They can also supply from their sister concern M/S Garnett Wire Ltd, UK who manufacture interlocking wires as well as metallic wires in heavier cross section commonly used in blow room lines, woollen, nonwoven & worsted machineries.

The ICC stamp of quality, recognised the world over, is further endorsed by the ISO 9001 Certification from BVQI. ICC has satisfied clients in virtually every part of the globe-the Far East. South East Asia, Africa, Europe and the Americas.

Customer Support

One of the biggest advantages of buying an ICC product is that it comes complete with ICC Customer Care, the support services that set the standard for quality and reliability. From the minute you purchase any ICC product, have their commitment to helping you get the most from it. They’re always close by to provide product support, or just to answer the questions, whenever and wherever you need us.

Only trust the repair or service of the ICC product by an authorized technician. Their support technicians are trained to assist you for repair of ICC products.

In order to provide full assistance of servicing they have service stations situated in both Coimbatore & Madurai Branch. They conduct all types of mounting of metallic wire, clipping & grinding of tops in their service station. On request their trained technicians also conduct mounting work in mills at a nominal service charge

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.40.63
UK Pound	1	Rs.81.01
Euro	1	Rs.54.89

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	9
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	6
--RESERVES	1~10	5
--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	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--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 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

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