MIRA INFORM REPORT

Report Date :

27.02.2007

IDENTIFICATION DETAILS

Name :	PRISM CEMENT LIMITED
Registered Office :	305, Laxmi Nivas Apartments, Ameerpet, Hyderabad – 500 016, Andhra Pradesh
Country :	India
Financials (as on) :	31.03.2006
Date of Incorporation :	26.03.1992
Com. Reg. No.:	01-14033
CIN No.: [Company Identification No.]	U26942AP1992PLC014033
TAN No.: [Tax Deduction & Collection Account No.]	MUMP04712B
PAN No.: [Permanent Account No.]	AAACP6224A
Legal Form :	Public limited liability company. The shares of the company are listed on the Stock Exchanges.
Line of Business :	Manufacturers of Portland Cement.

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 10000000
Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject is a well-established and reputed company and its financial position is improving. Directors are reported as experienced and respectable businessmen. Company’s profitability is improving. It is expected to wipe off its previous losses soon. Payments are reported as usually correct and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	305, Laxmi Nivas Apartments, Ameerpet, Hyderabad – 500 016, Andhra Pradesh, India
Tel. No.:	91-40-23319208 / 23396082
Fax No.:	91-40-23319135 / 26100179
E-Mail :	aneetakulkarni@prismcement.com
Website :	http://www.prismcement.com
Administrative/ Marketing Office :	16/1/6A, Tagore Town, J. N. Road, Allahabad – 211 002, Uttar Pradesh, India
Tel. No.:	91-532-2465228/ 332
Corporate Office :	Rahejas, Main Avenue, V. P. Road, Santacruz (West), Mumbai – 400 054, India
Tel. No.:	91-22-66754142/ 4143
Fax No.:	91-22-26001304
Factory 1 :	Village Mankahari/Bamhori, Satna – 485 111, Madhya Pradesh, India
Tel. No.:	91-7672-275301/2

DIRECTORS

Name :	Mr. Rajan B. Raheja
Designation :	Chairman
Name :	Mr. Manoj Chhabra
Designation :	Managing Director
Name :	Mr. Aziz H. Parpia
Designation :	Director
Name :	Mr. Rajesh G. Kapadia
Designation :	Director
Name :	Mr. Satish B. Raheja
Designation :	Director
Name :	Mr. Vijay Aggarwal
Designation :	Alternate to Mr. Satish Raheja
Name :	Mr. K. Swaminathan
Designation :	Nominee of ICICI Bank Limited

KEY EXECUTIVES

Name :	Mrs. Aneeta S. Kulkarni
Designation :	Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

Names of Shareholders	No. of Shares	Percentage of Holding
Promoters	184645821	61.91
Indian Public	76172330	25.54
FIIs/NRIs/OCBs	6235459	2.09
Bodies Corporate	18410471	6.17
Finanical Institutions/ Banks/ Mutual Funds	12785919	4.29
Total	298250000	100.00

BUSINESS DETAILS

Line of Business :

Manufacturers of Portland Cement.

Products :

Item Code No. (ITC CODE)	252392
Product Description	Portland Cement

PRODUCTION STATUS

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
Cement	Tonnes		2000000	2160066

GENERAL INFORMATION

Bankers :

v State Bank of India

v Vijaya Bank

v Bank of Baroda

Facilities :

Secured Loans (Rs. In millions ) :

Term Loans
Banks	915.149
Working Capital Demand Loans/ Cash Credits
Banks	87.505
Total	1002.654

Unsecured Loans :

Term Loan from Bank	76.618
Total	76.618

Banking Relations :	Satisfactory
Auditors :
Name :	N. M. Raiji & Company Chartered Accountants
Address :	Mumbai

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
325000000	Equity Shares	Rs.10/- each	Rs.3250.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
298250000	Equity Shares	Rs.10/- each	Rs.2982.500 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		30.06.2006	30.06.2005	30.06.2004
SHAREHOLDERS FUNDS
1] Share Capital		2982.500	2982.500	2982.500
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		0.000	0.000	(1328.100)
4] (Accumulated Losses)		(449.012)	(1069.843)	0.000
NETWORTH		2533.488	1912.657	1654.400
LOAN FUNDS
1] Secured Loans		1002.654	2057.809	2440.800
2] Unsecured Loans		76.618	278.036	421.500
TOTAL BORROWING		1079.272	2335.845	2862.300
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		3612.760	4248.502	4516.700
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		3484.833	3704.903	3840.700
Capital work-in-progress		79.597	104.183	40.500
INVESTMENT		0.000	0.000	0.000
DEFERREX TAX ASSETS		22.980	214.815	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	617.757	611.639	456.700
	Sundry Debtors	145.499	128.862	188.300
	Cash & Bank Balances	169.093	94.044	134.700
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	365.121	301.966	1284.400
Total Current Assets		1297.470	1136.511	2064.100
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	1165.699	924.863	1539.500
	Provisions	125.076	28.555	12.100
Total Current Liabilities		1290.775	953.418	1551.600
Net Current Assets		6.695	183.093	512.500
MISCELLANEOUS EXPENSES		18.655	41.508	123.000
TOTAL		3612.760	4248.502	4516.700

PROFIT & LOSS ACCOUNT

PARTICULARS		30.06.2006	30.06.2005	30.06.2004
Sales Turnover		6781.783	5294.320	4638.400
Other Income		22.687	21.182	75.700
Total Income		6804.470	5315.502	4714.100
Profit/(Loss) Before Tax		906.539	402.792	906.300
Provision for Taxation		285.708	144.576	503.600
Profit/(Loss) After Tax		620.831	258.216	402.700
Earnings in Foreign Currency :
	Export Earnings	12.359	14.866	NA
Total Earnings		12.359	14.866	NA
Imports :
	Stores & Spares	81.586	184.280	NA
Total Imports		81.586	184.280	NA
Expenditures :
	Cost of Goods Sold
	Manufacturing Expenses	4079.760	3225.608	327.200
	Administrative Expenses	1040.510	863.852	1313.700
	Raw Material Consumed	NA	NA	166.300
	Miscellaneous Expenses	NA	NA	101.200
	Salaries, Wages, Bonus, etc.	194.012	171.190	148.800
	Interest	188.428	208.385	252.500
	Power & Fuel	NA	NA	1208.400
	Depreciation & Amortization	330.192	343.579	288.100
	Other Expenditure	65.029	100.096	831.500
Total Expenditure		5897.931	4912.710	4637.700

QUARTERLY RESULTS

PARTICULARS	30.09.2006 (1^st Qtr.)	31.12.2006 (2^nd Qtr.)
Sales Turnover	1594.600	1900.100
Other Income	8.100	10.700
Total Income	1602.700	1910.800
Total Expenditure	1153.300	1059.500
Operating Profit	449.400	851.300
Interest	36.500	16.100
Gross Profit	412.900	835.200
Depreciation	78.200	79.000
Tax	38.100	85.600
Reported PAT	221.500	500.900

200609 Quarter 1

Notes:

EPS is Basic and Diluted 1.The Company is engaged only in cement business and there are no separate reportable segments as per AS-17. 2. The Company has incurred heavy expenditure on repairs of the plant the initial period of the accounting year. Such expenditure is prorated equally over the four quarters. Consequently, proportionate expenditure of Rs.25.021 millions has been charged off in the current quarter. 3. The Statutory Auditors have carried out the limited review of the results for the quarter ended September 30, 2006. 4. Figures of the previous periods have been regrouped wherever necessary. 5. There were no complaints pending at the beginning of the quarter ended September 30, 2006. During the said quarter, the company received 28 investor complaints, all of which have been redressed. 6. The above statement has been reviewed by the Audit Committee and taken on record by the Board of Directors at its meeting held on October 30, 2006. 7.For the company, revised AS-15 on 'Employee Benefits' issued by ICAI is applicable from the current quarter. A charged for the current quarter has been accounted on an estimated basis. Any additional obligation as at beginning of year i.e July 1, 2006 will be recognized during the year.

200612 Quarter 2

Notes

EPS is Basic & Diluted Status of Investor Complaints for the quarter ended December 31, 2006 Complaints Pending at the beginning of the quarter Nil Complaints Received during the quarter 64 Complaints disposed off during the quarter 64 Complaints unresolved at the end of the quarter Nil 1.The Company is engaged only in cement business and there are no separate reportable segments as per AS-17. 2. The Company has incurred heavy expenditure on repairs of the plant during the initial period of the accounting year. Such expenditure is prorated equally over the four quarters. Consequently, proportionate expenditure of Rs 20.50 million has been charged off in the current quarter. The amount for the six month period is Rs 41.00 million. 3. For the Company, revised AS-15 on 'Employee Benefits' issued by ICAI is applicable from the current year. A charge for the current period has been accounted on an estimated basis. Any additional obligation as at the beginning of the year i.e. July 01, 2006 will be recognized during the year. 4. Figures of the previous periods have been regrouped wherever necessary. 5. The Statutory Auditors have carried out the limited review of the results for the quarter and half year ended December 31, 2006. 6.The above statement has been reviewed by the Audit Committee and taken on record by the Board of Directors at its meeting held on January 16, 2007.

KEY RATIOS

PARTICULARS	31.06.2006	31.06.2005	31.06.2004
Debt-Equity Ratio	0.77	1.46	1.80
Long Term Debt-Equity Ratio	0.67	1.28	1.60
Current Ratio	1.00	1.07	1.11
TURNOVER RATIOS
Fixed Assets	1.13	0.90	0.80
Inventory	11.03	9.91	10.60
Debtors	49.43	33.38	20.33
Interest Cover Ratio	5.81	2.93	1.30
Operating Profit Margin (%)	20.67	17.22	13.31
Profit Before Interest And Tax Margin (%)	16.14	11.54	7.10
Cash Profit Margin (%)	13.69	10.55	4.93
Adjusted Net Profit Margin (%)	9.15	4.88	(1.28)
Return On Capital Employed (%)	23.49	12.64	0.00
Return On Net Worth (%)	20.81	11.14	0.00

STOCK PRICES

Face Value	Rs.10.00/-
High	Rs.38.35/-
Low	Rs.37.30/-

LOCAL AGENCY FURTHER INFORMATION

HISTORY

Subject was incorporated on 26.03.1992 at Hyderabad in Andhra Pradesh having company registration number 14033.

Subject was originally incorporated under the name and style Karan Cement Limited. The original promoter was Dr. B. V. Raju and his associates. Later the company was taken over by Rajan Raheja, a real estate developer. Raheja’s representatives joined PCL’s Board in 1992 and he himself joined it in the year 1994. The company’s name changed to present in the year 1994. The company has two more promoters – F. L. Smidth, Denmark, one of the world’s leading cement machinery manufacturers and the Industrialization Fund for Developing Countries, Denmark.

The company has proposed to raise equity between Rs. 3000.00 millions to Rs. 4000.00 millions and issue equity to the promoter group by private placement or preferential allotment. Any equity infusion involving the promoters could assume importance in the wake of the ongoing consolidation wherein smaller players are bought out by domestic majors as well as MNC’s. The possibility of the company raising further equity may not have a negative influence on the stock price as cutting debt may improve the fundamentals. More so since the industry scenario is not all that good in terms of volume growth and profitability.

A joint venture agreement was executed between Rajan B. Raheja, F. L. Smidth and Company, Denmark and the Industrialization Fund of Developing Countries, Denmark for setting up of a cement plant with latest technology. One of the main promoters for this project, F. L. Smidth and Company, Denmark, is a world leader in two key aspects of the cement industry development of technology and manufacturer of machinery.

The Satna Plant (in Madhya Pradesh) of the company with an installed capacity of 2 million tonne is with latest technology and has special features like a six-stage low-pressure drop pre heater, bucket elevators for silo and kiln feeding, roller presses for cement grinding and electronic packers for cement. Sophisticated pollution control equipment is being used to ensure dust emission levels, which will conform, to World Bank Standards. The company has installed imported latest technology HEXADUR Rollers from Germany in one of the Roller Presses in January 2002. This technology, first of its kind used in India will increase production capability and reduce power consumption. The company has also owns an captive power plant to meet its power requirements.

In December, 2000 Rajan Raheja (the promoter) has increased the equity stake in the company from 13.27% to 17.16%. The company has converted loans worth over Rs. 411.400 millions taken from Raheja into equity shares.

The company is in trade terms with:

· Indo-Chem Industries Limited

· Shanghvi Engineering

· Pioneer Industries

The company’s manufacturing facilities are based at Satna, Madhya Pradesh and caters to the markets in the States of Uttar Pradesh, Bihar and Madhya Pradesh. It has an installed capacity of 2.00 million tonnes per annum. Capacity utilization during FY2000 went up to 87% from 78% in the previous year.

The company’s fixed assets include Freehold and Leasehold land, Mining lease, Mines development, Railway siding, Buildings, Plant and Machinery, Furniture, fixtures and office equipments and vehicles.

OPERATIONS

Production of clinker and cement registered a growth of 8% and 10% respectively for the year under review.

The Company produced 2.202 millions tonnes of clinker and 2.160 millions tonnes of cement during the year ended June 30, 2006, as against 20.41 millions tonnes of clinker and 1.968 million tonnes of cement produced during the year ended June 30, 2005.

As a result of the above, there was a 50% rise in operating profit from Rs. 1017.200 millions in the previous year to Rs. 1529.800 millions in the year under review. After providing for taxes, the Company earned a net profit of Rs. 6,208 millions during the year as against Rs. 258.200 millions for the previous year.

FINANCE

Growth in volumes, higher cement prices, optimizing realizations and a consistent check on costs enabled the Company to improve its margins and consequently reduce its debt. The Company repaid high-cost debt of about Rs. 1291.600 millions during the year under review.

Despite, firming up of interest rates, efficient management of funds resulted in the reduction of finance charges from Rs. 308.500 millions for the year ended 30.6.2005 to Rs. 253.500 'millions during the year ended 30.6.2006.

Highlights : 2005-06

During the year, the Company achieved a sale of cement and clinker of 2.706 million tonnes as compared to 2.398 million tonnes in the previous year, registering a growth of 13%. Stable plant operations, strong brand image and consistent good quality were key factors in registering significant growth in volumes. Despite rise in input and logistics costs, efficient realization management, cost controls and tight fund management resulted in reduction of finance costs and overall improvement in margins. As an outcome, EBDITA for the year increased by Rs. 435.300 millions (increase by 41%). Profit before tax for the year stood at Rs. 906.500 millions as compared to Rs. 402.800 millions in the previous year, registering a growth of 125%.

Business Environment

The Indian economy continued on its growth path with investment in infrastructure by the Government as well as private sector catching up. This has increased the demand for cement. As a result of this, the industry witnessed a healthy growth in the last year with capacity utilization increasing from 84% in the previous year to 90% for the year 2005-06. Cement production registered an increase of about 11%, from 127.57 Million. T. for the year 2004-05 to 141.81 Million T. for the year 2005-06.

With sustained Government impetus on infrastructure and housing, the outlook for the Indian cement industry remains positive and the current year 2006-07 should witness a continuation of the trends of the past year. However, the high oil prices and rising interest rates remain high risk factors having potential to affect economic growth and thereby demand for cement.

Review of Operations and Future Outlook

Buoyed by higher product prices and sales volume, the Company's net profit surged from Rs. 258.200 millions for the year ended June'30, 2005 to Rs. 620.800 millions for the year ended June 30, 2006. Sales for the year under review were Rs. 6781.800 millions as against Rs. 5294.300 millions for the previous year. While rate of growth in sales was 28%, the rate of growth in net profit was 140%. The management took several initiatives during the year to achieve this performance.

Improvement in production accompanied by significant improvement in energy consumption resulted in savings in cost of production. Specific power consumption improved to 76 kWh/ tonne of cement from 79 kWh/tonne of cement in the previous year.

The thrust on saving, in logistics cost has continued during the year and despite a sharp increase in the price of HSD, economy in freight cost was achieved due to efficient management of logistics.

The Company saved a considerable amount on interest cost due to repayment of high cost debt and renegotiating

interest rates on other borrowings. The overall interest burden of the Company was reduced by about 18%, over and above the 26% achieved last year.

Reorientation of marketing strategy continued with a strong focus on the Company's natural markets. The Company's brand name "Champion" became the preferred choice of customers due to its superior quality and the Company's transparency in dealings with its dealers and stockists. The Company has further widened its customer base and geographical spread.

This has resulted in increase in the share of blended cement from 56% of the total production in the previous year to 72% during the year under review.

Having embarked on its turnaround path, Prism now looks forward to stability and improved financial performance. The Company's focus in the coming years will be on increasing its capacity, both at existing and other locations and on consolidating for future growth.

Website Details :

CEMENTING THE FUTURE

With an objective of being an active participant - in the dynamics of future - of the Nation's march towards total industrialization, subject has set up a state-of-the-art cement plant near Satna, in Madhya Pradesh.

The 2.51 million tonnes capacity ultra-modern cement plant of subject is one of the most advanced cement producers in the world. With machinery and technology imported from the world leaders, and state-of-art processes that lend it a futurist environment. The company has set up a packing unit at Allahabad to cater to the requirement of customers in Eastern/Central U.P.

The Company is jointly promoted by Rajan Raheja Group of Mumbai, F. L. Smidth & Co. A/S, Denmark(FLS), World leaders in cement technology and Industrialization Fund for Developing Countries, Denmark(IFU).

A team of experienced engineers and a dedicated workforce, rich deposits of high quality limestone, a high level of automation and sophisticated quality control systems with unbeatable facilities, Prism has truly taken cement production to global standards.

Subject’s achievements have been made possible by their people - People with vision, united by shared values and their commitment to excellence in the world of construction.

Code of Conduct for Directors

Introduction

The reputation and integrity of Prism Cement Limited are the valuable assets that are vital to the Company’s success. Subject's commitment to ethical and lawful business conduct is a fundamental shared value of the Board of Directors, management and employees and critical to the Company's success. Subject’s standards for business conduct focus the Board and each Director on areas of ethical and legal standards vigorously as financial objectives are pursued, and help foster a culture of honesty, integrity and accountability. Consistent with these principles, Prism's Board has adopted this Code of Conduct as a guide to the high ethical and legal standards expected of its members. Each Director must comply with the letter and spirit of this Code.

No code or policy can anticipate every situation that may arise. Accordingly, this Code is intended to serve as a source of guiding principles for Directors.

This Code requires certain disclosure to be made to the Company which will be considered privileged and will not be disclosed except under any legal requirement.

Guidelines

v In performing their Board and Board Committee functions, Directors will -Act diligently, openly, honestly and in good faith.

v Provide leadership in advancing the Company's Vision, Values and Guiding Principles.

v Discharge their duties, as members of the Board and of any Board Committees on which they serve, in accordance with their good faith business judgment and in the best interests of the Company and its stakeholders.

v Become and remain familiar with Prism's business and the economic and competitive environment in which the Company operates and understand Prism's principal business plans, strategies and objectives; operations, results and financial condition; and relative marketplace position.

v Commit the time necessary to prepare for, attend (in person or telephonically, as appropriate) and actively participate in regular and special meetings of the Board and of the Board Committees on which they serve.

v Submit requisite declarations as stipulated under the Companies Act, 1956 and applicable statutes, if any, to the Board / Company. Annually, and as when changes take place, inform the Chairman of the Board and the Company of their employment, other Board positions, details of and relationships with other business (including shareholdings) charitable, and governmental entities, and other events, circumstances or conditions that may interfere with their ability to perform their Board or Board Committee duties or impact the Board's assessment of whether they meet the independence requirements of the Stock Exchanges and the Securities and Exchange Board of India.

v Not enter into, without the prior approval of the disinterested members of the Board, any transaction or relationship with Prism in which they will have a financial or personal interest (either directly or indirectly, such as through a family member or other person or organization with which they are associated), or any transaction or situation which otherwise involves a conflict of interest, except as may be permitted under the Companies Act, 1956 or any amendments thereto.

v Maintain the confidentiality of all material non-public information about Prism, its business and affairs.

v Abide by all applicable laws and regulations and Prism's Code of Internal Procedures and Conduct for Prevention of Insider Trading.

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.44.28
UK Pound	1	Rs.86.62
Euro	1	Rs.58.32

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	9
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	6
--RESERVES	1~10	5
--CREDIT LINES	1~10	4
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		55

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

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

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

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/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