MIRA INFORM REPORT

Report Date :

29.03.2007

IDENTIFICATION DETAILS

Name :	DCM SHRIRAM INDUSTRIES LIMITED
Registered Office :	Kanchenjunga Building, 5^th Floor, 18, Barakhamba Road, New Delhi – 110 001, India
Country :	India
Financials (as on) :	31.03.2006
Date of Incorporation :	21.02.1989
Com. Reg. No.:	55-35140
CIN No.: [Company Identification No.]	U74899DL1989PLC035140
TAN No.: (Tax Deduction & Collection Account No.)	DELD06462B DELD06289D
PAN No.: (Permanent Account No.)	AAACD0204C AAACD0229M
Legal Form :	It is a public limited liability company. The company's shares are listed on the Stock Exchanges.
Line of Business :	Engaged in manufacturing of chemicals, sugar and textile products.

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 6000000
Status :	Satisfactory
Payment Behaviour :	Slow but Correct
Litigation :	Clear
Comments :	Subject is a well-established and reputed company having satisfactory track. The company is making satisfactory progress in its performance. Directors are experienced and resourceful industrialists. Trade relations are reported as fair. Payments are reported as slow but correct. The company can be considered normal for business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	Kanchenjunga Building, 5^th Floor, 18, Barakhamba Road, New Delhi – 110 001, India
Tel. No.:	91-11-2332 1413 (10 Lines)/ 91-11-23759300
Fax No.:	91-11-2331 0765 / 2331 5424
E-Mail :	dsil@dcmsr.com
Website :	http://www.dauralaorganics.com, http://www.dcmsr.com
Divisional offices:	Kanchenjunga Building, 18, Barakhamba Road, New Delhi - 110 001
Tel. No.:	91-11-2332 1413 (10 Lines)
Fax No.:	91-11-2335 0765 / 2331 5424
E-Mail :	sugarsud@dcmsr.com
Divisional offices:	1-89, Himalaya House, 23, Kasturba Gandhi Marg, New Delhi - 110 001
Tel. No.:	91-11-2331 8609
Fax No.:	91-11-2331 8605
E-Mail :	doldelhi@del2.vsnl.net.in
Divisional offices:	Akashdeep Building, 5^th Floor, 26A, Barakhamba Road, New Delhi - 110 001
Tel. No.:	91-11-2331 2267
Fax No.:	91-11-2331 3494
E-Mail :	shrirayn@del2.vsnl.net.in
Divisional offices:	204-205, Ashoka Estate Building, Barakhamba Road, New Delhi - 110 001
Tel. No.:	91-11-2373 9311
Fax No.:	91-11-2373 9316
Regional offices:	Sir Vithaldas Chambers, 6^th Floor, 16, Mumbai Samachar Marg, Mumbai - 400 023
Tel. No.:	91-22-22041455
Fax No.:	91-22-22041570
Regional offices:	26A, Watgunge Street, Kolkata - 700 023, West Bengal
Tel. No.:	91-33-22459574
Fax No.:	91-33-2459 0508
Corporate Office :	Kanchenjunga Building, 18, Barakhamba Road, New Delhi - 110 001, India
Tel. No.:	91-11-2332 1413 (10 Lines)
Fax No.:	91-11-2335 0765 / 331 5424
E-Mail :	dsil@dcmsr.com
Website :	http://www.dauralaorganics.com, http://www.dcmsr.com
Factory 1 :	DCM SHRIRAM TEXTILES HRM Premises, Dasna, Ghaziabad, Uttar Pradesh
Factory 2 :	DAURALA ORGANICS Daurala, Meerut District - 250221, Uttar Pradesh
Tel. No.:	91-121-2588096
Fax No.:	91-123-2788131
E-Mail :	http://www.dauralaorganics.com
Factory 3 :	SHRIRAM RAYONS Shriram Nagar, Kota, Rajasthan - 324 004
Tel. No.:	91-744-2424401
Fax No.:	91-744-2424403
E-Mail :	srryons@jp1.dot.net.in
Factory 4 :	INDITAL TINTORIA LIMITED Matsya Industrial Area, District Alwar, Rajasthan
Tel. No.:	91-144-2281053 / 2811053
Fax No.:	91-144-2281253
E-Mail :	srrayons@jp1.dot.net.in
Factory 5 :	DCM REMY LIMITED Daurala, Meerut District, Uttar Pradesh
Tel. No.:	91-121-2288533
Fax No.:	91-1237-288511
Factory 6 :	Daurala Sugar Works, Daurala, Meerut District - 250221, Uttar Pradesh
Tel. No.:	91-1237-288096 – 99
Fax No.:	91-1237-288131
E-Mail :	dsw@dcmsr.com

DIRECTORS

Name :	Shri Tilak Dhar
Designation :	Chairman & Managing Director
Name :	Shri Alok B. Shriram
Designation :	Dy. Managing Director
Name :	Shri S.D. Nigam
Designation :	Whole - Time Director
Name :	Shri Madhav B. Shriram
Designation :	Whole - Time Director
Name :	Shri Atam Parkash
Designation :	Directors
Name :	Shri P.R. Khanna
Designation :	Directors
Name :	Dr. V.L. Dutt
Designation :	Directors
Name :	Shri K.K. Mudgil
Designation :	UTI Nominee
Name :	Shri S. P. Arora
Designation :	IFCI Nominee

KEY EXECUTIVES

Name :	Shri B. P. Khandelwal
Designation :	Company Secretary
Name :	Shri D.C. Mittal
Designation :	President
Name :	Shri G. Kumar
Designation :	Chief Operating Officer (Sugar)
Name :	Shri Anil Gujral
Designation :	Chief Operating Officer (Chemicals & Alcohol)
Name :	Shri V.K-Jhingon
Designation :	Vice President and Resident Head (Rayons)
Name :	Shri N.K. Jain
Designation :	Chief Financial Officer
Name :	Mr. K N Rao
Designation :	Chief Operating Officer (Rayons)

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

Names of Shareholders	No. of Shares	Percentage of Holding
Promoters	43.53	28.46
FIs, Banks & Mutual Funds	32.01	20.92
Others (public)	77.44	50.62
TOTAL	152.98	100.00

BUSINESS DETAILS

Line of Business :

Engaged in manufacturing of chemicals, sugar and textile products.

Products :

ITC Code	17.01
Product Descriptions	Cane Sugar

ITC Code	59.02
Product Descriptions	Tyre Cord Fabric

ITC Code	22.08
Product Descriptions	Undenatured Ethyl Alcohol

ITC Code	2207.10
Product Descriptions	Ethyl Alcohol Rectified Spirit

Exports to :

Europe and USA.

PRODUCTION STATUS

Particulars	Unit	Installed Capacity	Actual Production
Sugar	Tonnes	8000	155156
Alcohol	K.L.	45000	30636
Fine Chemicals	Tonnes	13114	5784
Industrial Fibres	Tonnes	15700	7000
Carbon-di-sulphide	Tonnes	15	901
Anhydrous Sodium Sulphate	Tonnes	7700	6090
Textiles	Looms Nos.	--	--

GENERAL INFORMATION

Suppliers :

Ø Apex Enterprises

Ø Amit Offset Works

Ø Atul Rubbers Private Limited.

Ø Bhatia Metals

Ø Bright Enterprises

Ø DKB Engg. Works

Ø Dashmesh Auto Engineers

Ø Grover & Company

Ø Hind Soka Enterprises

Ø Hindustan Auto Electric Work

Ø Indana Rubber Industries

Ø JM Engg. Works

Ø Jugnu Electric Works

Ø Kota Electronics

Ø Kota Glass Works

Ø Mittal Industries

Ø Nacones Private Limited

Ø NK Paper Tube Industries

Ø New Shakti Rewinder

Ø NSP Tech Services

Ø Om Gases & Chemicals

Ø PL Engg. Works

Ø Punjab Electrical Industries

Ø Pentagon Turbines Private Limited

Ø Reliable Chemical Industries

Ø Universal Stores Supplying Co.

Ø Vikas Pumps & Projects

Ø CNV Engineering Private Limited.

Ø Flexibles, Flow Chem Industries

Ø GVT Engg. (I) Private Limited.

Ø Maharani Industrial Corporation

Ø Mono Industries, N.D. Enterprises

Ø Pap-Flon Engineering Co.

Ø Pap-Flon Enterprise Pawan Brothers

Ø Shefa Engineers Private Limited.

Ø Super Scientific Works Private Limited.

No. of Employees :

2689

Bankers :

Ø State Bank of India

Ø Punjab National Bank

Ø Oriental Bank of Commerce

Ø State Bank of Bikaner & Jaipur

Ø Punjab & Sind Bank

Ø The United Western Bank Limited

Ø The Hongkong and Shanghai Banking Corporation Limited

Ø Moradabad Zila Sahkari Bank Limited

Ø Meerut Zila Sahkari Bank Limited.

Ø Ghaziabad Zila Sahkari Bank Limited

Ø Saharanpur Zila Sahkari Bank Limited

Ø Karnataka Bank Limited

Ø Syndicate Bank

Facilities :

Secured Loans	31.03.2006
Debentures
Principal amount-Gross	209.212
Banks
Cash Credits	1183.351
Terms Loans	108.126
Others	381.172
Finance Lease Liabilities	9.334
Total	1891.195
Unsecured Loans
Deposits :-
Fixed	36.354
Others	19.939
Total	56.293
Grand Total	1947.488

SECURED

Debentures

5,00,000 (2004-05 - 5,00,000) privately placed 10% (as rescheduled) secured redeemable non convertible debentures of Rs.100 each allotted w.e.f. April 24,1992. Rs.33.333 Millions outstanding against the same was rescheduled for redemption at par in 6 quarterly installments commencing from June 30,2005. The installments due for redemption have been redeemed.

2,00,000 (2004-05 - 2,00,000) and 1,00,000 (2004-05 -1,00,000) privately placed 12.50% (as rescheduled) secured redeemable non convertible debentures of Rs.100 each allotted w.e.f. April 24,1992 and July 14,1992 respectively, were rescheduled for redemption at par in 28 equal quarterly installments commencing from October 15,2004. The installments due for redemption have been redeemed.

2,00,000 (2004-05 - 2,00,000) and 50,000 (2004-05 - 50,000) privately placed 12.5% (as rescheduled) secured redeemable non convertible debentures of Rs.100 each allotted w.e.f. April 24, 1992 and July 14, 1992 respectively, were rescheduled for redemption at par in 28 equal quarterly installments commencing from December 31,2005. The installments due for redemption have been redeemed.

8,98,000 (2004-05 - 8,98,000) privately placed 12.50% (as rescheduled) secured redeemable non convertible debentures of Rs. 100 each allotted w. e.f. June 18,2001, were rescheduled for redemption at par in 26 equal quarterly installments commencing from April 15,2005. The installments due for redemption have been redeemed.

These debentures are secured by a first mortgage over all the immovable properties and a first charge by way of hypothecation of all the movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, both present and future (save and except book debts), subject to prior charges created / to be created in favour of the Company's bankers for securing borrowings for working capital requirements, the charges ranking pari-passu with the mortgages and charges created / to be created in favour of existing first charge holders for their respective term loans /debentures. Debentures in (a)(iv) above are also secured / to be secured by second charge on current assets of the Company excluding those of Dajjrala Organics, a unit of the Company.

8,46,839 (2004-05 - 8,46,839) - Part-C of Rs.50 each, being the non convertible portion of 10% (as rescheduled) secured redeemable partly convertible debentures of Rs.135 each and 8,31,680 (2004-05 - 8,31,680) 10%

(as rescheduled) secured redeemable non convertible debentures of Rs.60 each allotted w.e.f. February 22, 1994, were rescheduled for redemption in 6 quarterly installments w.e.f. June 30,2005. The installments due for redemption nave been redeemed.

2,42,047 (2004-05 - 2,42,047) - Part-C of Rs.50 each, being the non convertible portion of 12.50%(as rescheduled) secured redeemable partly convertible debentures of Rs.135 each and 2,42,047 (2004-05 - 2,42,047) 12.50% (as rescheduled) secured redeemable non convertible debentures of Rs.60 each, allotted w.e.f. February 22, 1994 were rescheduled for redemption in 28 equal quarterly installments commencing from October 15,2004.

The installments due for redemption have been redeemed.

2,38,113 (2004-05 - 2,38,113) - Part-C of Rs.50 each, being the non convertible portion of 12.50% (as rescheduled) secured redeemable partly convertible debentures of Rs.135 each and 2,40,397 (2004-05 - 2,40,397) 12.50% (as rescheduled) secured redeemable non convertible debentures of Rs.60 each, allotted w.e.f. February 22, 1994, were rescheduled for redemption in 28equal quarterly installments commencing from December 31,2005.

The installments due for redemption have been redeemed.

These debentures are secured by way of second charge / mortgage in favour of the trustees on all or any of the immovable and/or movable properties of the Company excluding all assets of Daurala Organics a unit of the Company, both present and future, upon such terms and conditions and in such form and manner as the Board may determine

in consultation with the Trustees but specifically excluding the current assets, receivables, inventories, book debts (present and future) and such other specific items of machinery and equipments or any other assets as are specifically charged to any other lenders or authorities.

Banks

Cash credits are secured by hypothecation of stocks/stores, both present and future. Some of these are further secured by hypothecation of book debts/ receivables and also by way of second pari-passu mortgage and charge on the fixed assets, both present and future.

Rs.90.909 Millions (2004-05 - Rs.117.204 Millions) are secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans / debentures.

Rs.759.5 Millions (2004-05 - Rs. 12.658 Millions) are secured by a first mortgage and charge on all the immovable and movable properties (save and except book debts) of Daurala Organics a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans.

Rs.11.374 Millions (2004-05 - Rs. 11.480 Millions) are secured by hypothecation of the specific assets.

Others

Rs.220.973 Millions (2004-05 - Rs.288.343 Millions) from financial institutions secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans / debentures. Out of these Rs. 1541.89 Millions

(2004-05 - Nil) relating to a financial institution is further secured / to be secured by second charge on current assets of the Company excluding those of Daurala Organics, a unit of the Company.

Rs.2.252 Millions (2004-05 - Rs.11.262 Millions) from a financial institution is secured by first charge by way of mortgage on all the immovable and movable properties (save and except book debts) of Daurala Organics a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans.

Rs.30.000 Millions (2004-05 - Rs.31.700 Millions) from a financial institution is secured by first charge by way of equitable mortgage on all the immovable and movable properties (save and except book debts) and a floating charge on the current assets subservient to the charge on the current assets in favour of the banks of Daurala Organics a unit

of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans.

Rs.32.004 Millions (2004-05 - Rs.51.639 Millions) from a financial institution as interest free loan in lieu of trade tax deferment scheme. The loan is secured by second charge on pari-passu basis on immovable and moveable assets of Daurala Organics a unit of the Company including its stock of raw materials, stores, finished stocks, stock in process and all book debts, both present and future.

Nil (2004-05 - Rs.11.1 Millions) from a financial institution secured by first charge on immovable and movable assets (except book debts) of the Company's sugar and distillery units, subject to prior charges created/to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans / debentures.

Rs.48.918 Millions (2004-05 - Rs. 116.101 Millions) interest on debentures held by financial institutions / mutual fund converted into loans, secured by a mortgage on all the immovable properties and a first charge by way of hypothecation of all the movable properties of the Company excluding all assets of Daurala Organics a unit of the Company, both present

and future (save and except book debts), subject to prior charges created/to be created in favour of the Company's bankers for securing borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans/debentures.

Rs.43.233 ta@M2004-05 - Rs.141.971 Millions) interest on debentures held by financial institutions / mutual fund converted, secured by way of second charge / mortgage on all immovable and movable properties of the Company excluding the assets of Daurala Organics a unit of the Company, both present and future, upon such terms and conditions and in such form and manner as the Board may determine in consultation with the Trustees but specifically excluding the current assets, receivables, inventories, book debts (present and future) and such other specific items of machinery and equipment or any other assets as are specifically charged to any other lenders or authorities.

Nil (2004-05 - Rs.101.00 Millions) are secured by pledge of investments in Omax Autos Limited.

Rs.0.743 Millions (2004-05 - Rs.1.335 Millions) are secured by hypothecation of the specific assets.

Finance Lease

Rs.9.334 Millions (2004-05 - Rs.2.504 Millions) are secured by hypothecation of the specific assets.

Banking Relations :	Satisfactory
Auditors :	A.F. Ferguson & Company Chartered Accountants New Delhi
Subsidiaries :	Ø Indital Tintoria Limited Ø DCM Shriram Leasing & Finance Limited Ø DCM Shriram International B V Ø Hindon River Mills Limited
Associates:	Ø DCM Hyundai Limited Ø Daurala Organics Limited Ø Daurala Foods & Beverages Private Limited
MEMBERSHIPS:	Confederation of Indian Industry

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
6,50,00,000	Equity shares	Rs. 10 each	Rs. 650.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
1,5298437	Equity shares	Rs. 10 each	Rs. 152.984 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2006 (12 Months)	31.03.2005 (12 Months)	31.03.2004 (18 Months)
SHAREHOLDERS FUNDS
1] Share Capital		152.984	137.302	137.302
2] Share Application Money		0.000	15.682	0.000
3] Reserves & Surplus		1671.644	1462.315	1463.855
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		1824.628	1615.299	1601.157
LOAN FUNDS
1] Secured Loans		1891.195	2514.280	2511.835
2] Unsecured Loans		56.293	68.860	61.061
TOTAL BORROWING		1947.488	2583.140	2572.896
DEFERRED TAX LIABILITIES		291.327	283.972	168.695
TOTAL		4063.443	4482.411	4342.748
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		2050.458	1951.903	1340.708
Capital work-in-progress		172.158	155.874	248.570
INVESTMENT		30.815	44.815	391.805
DEFERREX TAX ASSETS		38.661	152.094	127.050
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	1966.534	2301.389	2015.825
	Sundry Debtors	407.104	444.798	451.036
	Cash & Bank Balances	98.064	272.969	246.910
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	403.178	241.981	564.026
Total Current Assets		2874.88	3261.137	3277.797
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	980.327	976.037	941.786
	Provisions	128.954	117.157	114.669
Total Current Liabilities		1109.281	1093.194	1056.455
Net Current Assets		1765.599	2167.943	2221.342
MISCELLANEOUS EXPENSES		5.752	9.782	13.273
TOTAL		4063.443	4482.411	4342.748

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2006	31.03.2005	31.03.2004
Sales Turnover		6984.035	5333.158	6153.247
Other Income		208.776	216.485
Total Income		7192.811	5549.643	6153.247
Profit/(Loss) Before Tax		493.579	359.736	147.563
Provision for Taxation		202.662	111.345	116.170
Profit/(Loss) After Tax		290.917	248.391	31.393
Total Earnings		NA	NA	1627.006
Total Imports		NA	NA	490.921
Expenditures :
	Manufacturing Expenses	6342.904	4894.038
	Interest	215.306	243.778	5926.902
	Depreciation & Amortization	119.309	73.251
Total Expenditure		6677.519	5211.067	5926.902

QUARTERLY / SUMMARISED RESULTS

PARTICULARS	30.06.2006 (1^st Qtr.)	30.09.2006 (2^nd Qtr.)	31.12.2006 (3^rdQtr.)
Sales Turnover	1561.100	1414.100	1710.100
Other Income	8.800	07.300	66.400
Total Income	1569.900	1421.400	1776.500
Total Expenditure	1375.300	1301.700	1684.800
Operating Profit	194.600	119.700	91.700
Interest	51.100	39.000	40.600
Gross Profit	143.500	80.700	51.100
Depreciation	31.600	31.900	35.000
Tax	39.200	16.900	7.900
Reported PAT	72.700	31.900	8.200

200606 Quarter 1

Notes

EPS is Basic & Diluted Status of Investor Complaints for the quarter ended June 30, 2006 Complaints Pending at the beginning of the quarter Nil Complaints Received during the quarter 01 Complaints disposed off during the quarter 01 Complaints unresolved at the end of the quarter Nil 1. Figures for the quarter ended June 30, 2006 and June 30, 2005 are not comparable as the figures for quarter ended June 30, 2005 do not reflect the effect of amalgamation of Daurala Organics Limited with the Company effective from January 1, 2005, which was pending approval of the High Court of Delhi at that time. 2. In accordance with the accounting policy consistently followed by the Company, the off-season expenditure aggregating Rs 97.50 million (corresponding previous quarter Rs 49.70 million) have been deferred for inclusion in cost of sugar to be produced in the remainder of the year. 3. Liabilities / benefits, if any, that may arise out of reorganisation arrangement of DCM Limited. are not determinable at this stage. 4. The revised Accounting Standard AS-15 on Employee Benefits, issued by the Institute of Chartered Accountants of India which became effective from April 1, 2006 has been complied with for the current quarter. The adjustment on account of transitional provisions will be dealt with in the revenue reserves at the year end. 5. Provision for taxation Includes Current, Deferred and Fringe Benefit Tax. 6. Previous period figures have been regrouped / recast, wherever necessary.

200609 Quarter 2

Notes:

EPS is Basic & Diluted 1. Consistent with the accounting policy followed by the Company, the off-season expenditure aggregating Rs.23.25 Cr (Corresponding previous six months Rs.166 millions) have been deferred for inclusion in cost of sugar to be produced in the remainder of the year. 2. Liabilities/benefits, if any, that may arise out of reorganisation arrangement of DCM Limited are not determinable at this stage. 3. No complaint was pending at the beginning or the end of the quarter and no complaint received during the quarter. 4. Previous period figures have been regrouped/recast, wherever necessary.

200612 Quarter 3

Notes

Expenditure Includes (Increase)/Decrease in Stock in Trade Rs (106.10) million Consumption of Raw Materials Rs 1138.60 million Goods purchased for resale Rs 71.90 million Personnel Cost Rs 146.90 million Stores, Spares & Components Rs 184.70 million Power & Fuel Rs 88.00 million Other Expenditure Rs 160.80 million Tax Indicates Provision for Tax(Current net of MAT credit entitlement, Deferred and Fringe Benefits) 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 4 Complaints disposed off during the quarter 4 Complaints unresolved at the end of the quarter Nil 1. With modernisation of Company Sugar Unit, cane crushing capacity of 11000 TCD has become operational during the current sugar season. Bearish sugar price and shut down of the Rayon Unit for maintenance had adverse impact on the profits for the quarter. 2. Consistent with the accounting policy followed by the Company, the off-season expenditure aggregating Rs 166.30 million (corresponding previous nine months Rs 106.40 million) have been deferred for inclusion in cost of sugar to be produced in the remainder of the year. Other income includes Rs 59.40 million excess provision for liabilities written back. 3. Liabilities / benefits, if any, that may arise out of reorganisation arrangement of DCM Limited are not determinable at this stage. 4. Previous period figures have been regrouped / recast, wherever necessary.

KEY RATIOS

PARTICULARS	31.03.2006	31.03.2005	31.03.2004
Debt-Equity Ratio	1.89	2.50	2.50
Long Term Debt-Equity Ratio	0.82	1.25	1.41
Current Ratio	1.18	1.31	1.46
TURNOVER RATIOS
Fixed Assets	2.49	2.51	2.62
Inventory	3.95	3.06	3.09
Debtors	19.78	14.74	12.08
Interest Cover Ratio	3.29	2.48	1.29
Operating Profit Margin(%)	9.83	10.25	10.01
Profit Before Interest And Tax Margin(%)	8.42	9.14	8.81
Cash Profit Margin(%)	4.87	4.87	1.62
Adjusted Net Profit Margin(%)	3.45	3.76	0.42
Return On Capital Employed(%)	20.51	16.78	12.75
Return On Net Worth(%)	24.41	24.31	2.07

STOCK PRICES

Face Value	Rs.10/-
High	Rs.52.60/-
Low	Rs.48.00/-

LOCAL AGENCY FURTHER INFORMATION

FIXED ASSETS

Land, Buildings, Plant and machinery, Furniture and fixtures, Vehicles, Assets taken finance lease, Vehicles

FINANCIAL RESULTS

The turnover for the year including other income was Rs.7190 millions compared to Rs.5550 millions. in the previous year. The Gross Profit and the Net Profit were higher at Rs.630 millions. and Rs.290 millions. compared to Rs.410 millions. and Rs.250 millions respectively in the previous year. Exports of the Company at Rs.1860 millions against Rs.1390 millions in the previous year were an all time high.

After payment of dividend and transfer of Rs.60 millions to General Reserve (previous year - nil), the balance carried forward in the Profit & Loss Account will be Rs.610 millions which include Rs.320 millions brought forward from previous year and Rs.80 millions. Debenture Redemption Reserve written back.

OPERATIONS

Sugar

The overall performance of the business was better due to improved managerial inputs and market conditions.

The Country's sugar production and consumption during the year were more or less balanced. This coupled with exports resulted in lower inventories and sugar prices remaining firm. International sugar prices have also firmed up.

During the year, Daurala's cane crushing at 1.36 million MT and sugar production at 0.132 million MT were marginally lower than the previous year due to lower reservation of cane area as a result of establishment of new sugar factories around our plant. Due to early start of factories in the region and late rains, sugar recovery was lower than usual in Western U.P. as a whole and Daurala was no exception. Efforts are being made to improve cane availability this year.

The first phase of the project for expansion of cane crushing capacity and modernisation was implemented during the year by adding 2000 TCD capacity, taking the expanded crushing capacity to 10,000 TCD. The second phase of the project to add another 2000 TCD crushing capacity and modernisation of the sugar plant and the powerhouse is in progress. To provide further stability to the operations and achieve value addition, enhancing co-generation of power and other cost reduction measures are under active consideration.

Alcohols

Production and sale of alcohols were stable. Margins were under pressure due to reduced availability of molasses and resultant volatility in its price. Supplies of Anhydrous Alcohol to oil companies, which remained suspended through most part of the year due to unattractive prices offered by the oil companies, resumed in the last quarter on reaching an agreement with them. The prospects for the current year are encouraging. In case it is made mandatory for oil companies to admix 5% ethanol with petrol, demand could rise significantly.

Chemicals

During the first full year of operation of the chemical business after amalgamation of Daurala Organics, there was all round improvement. Year on year growth in income was higher and exports during the year also registered an increase over the previous year. In the phase of a continuing competitive market situation, the growth is indicative of better customer confidence in the Company and its products.

Efforts are on to improve efficiencies and increase the level of value addition, to counteract the increase in some raw material prices which are driven by rising global commodity prices.

Rayon

Rayon operations were upgraded with the addition of 500 TPA capacity and installation of state of the art

Airjet looms for improving the fabric quality.

Exports grew in spite of a weak Euro during the year. Operational margins, however, suffered during trie year on account of increased raw material prices, high energy costs and relatively weak Euro.

The Unit has installed a 3.2 MW back pressure turbine and is taking steps to install a high efficiency multi-fuel boiler. These steps are expected to reduce energy costs significantly and keep the Unit mere competitive in the international market. This Project will also promote "clean" fuel usage. Steps are also being taken to upgrade the dipping facility to meet value added products required by customers.

The Unit, for the 10th time since 1992-93, received the award for highest exports from Synthetics and Rayon Export Promotion Council for the year 2004-05.

Nylon

Nylon chafer market continued on a limited scale on account of availability of cheaper imported material.

PROMOTED COMPANIES

DCM Hyundai Limited.

The Company's efforts for diversification from traditional shipping containers to production and sale of special containers have achieved some break through. It is expected that the operations will improve further.

To supplement its efforts at arriving at a workable revival plan through the Hon'ble BIFR, the Promoter Company has taken over the debt of one of the two large creditors of the Company through a one time settlement. Efforts are being made to arrive at a settlement on the remaining issues, to be able to revive the Company.

Others

During the year Daurala Foods & Beverages Pvt. Limited. continued to earn a small operating profit. DCM Shriram Leasing & Finance Limited continued its efforts in recovering its dues as last year. However, recoveries have slowed down due to lengthy legal processes.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Company's business comprises of sugar, alcohols, chemicals and rayon with manufacturing facilities at Daurala (U.R) and Kota (Rajasthan). The performance of each segment during the year and the financials have been covered in the Directors' Report. The year 2005-06 was significant for the Company for achieving highest ever turnover and profits, after merger of Daurala Organics with the Company.

Industry structure and competitive scenario for various products are given below:

Sugar

The operations of the Company's sugar unit during the period were satisfactory and well managed. Despite a significant drop in the reserved cane area, the unit managed to crush 13.6 lap MT of cane by increasing procurement from its own area and from other assigned areas. In view of the increased crushing capacity we could have done better had full cane been available.

The new incentive scheme of the UP Government for creation of new capacity in the State is strongly biased towards new capacity, at the cost of the existing capacity and has significant barriers of entry for small groups and existing plants.

Various new sugar plants have come up in the area on the strength of the incentive scheme. On the other hand the State Government has so far been unable to evolve an equitable policy for allocation of sugarcane area amongst factories. These factories together have had an adverse impact on the operations of the existing sugar factories including ours. Efforts are continuing at various levels to evolve an equitable methodology for reservation of cane area on factory wise basis, in the overall interest of the industry.

After the decision of Supreme Court empowering the State Govt. to fix cane price, the State Govt. has yet to evolve a methodology for arriving at a fair price on a year to year basis which would take care of the various aspects, including sugar prices, for keeping the Industry healthy.

Domestic sugar production for the season more or less balanced with demand. This coupled with exports resulted in firming of sugar prices.

With the developed countries starting to withdraw subsidies and many sugar producing countries diverting sugar cane towards alcohol production, for mixing with petrol, the prices of sugar in the international market have firmed up. This will have a positive implication for the domestic sugar industry as a whole, as regards export avenues as also sugar price stability.

Alcohols

With the increasing trend of sugar production molasses and alcohol production is also expected to increase in the future.

The availability of free molasses would need to be closely monitored keeping its cyclic nature as also new distillation capacity coming up at the sugar factories in mind.

The Government of India is keen that the admixing of ethanol with petrol increases rapidly, in light of India's growing fuel demand and the surge in the global pricing. Keeping this and the normal growth in the Chemical and Potable sectors, the demand for alcohol is expected to remain strong in the future.

Fine Chemicals

While our fine chemicals business improved over the previous year, such business in general are operating under pressure.

Increase in cost of raw materials, many of which are linked to global and commodity price, has affected margins adversely.

The Company is pursuing a market led strategy to meet the situation, expanding the production and market share with a thrust on exports on one hand and improving process efficiencies and diversifying portfolio on the other.

Rayon

The Unit being a manufacturer of high tenacity rayon products for the tyre industry caters to major tyre producers in the international market. Presently tyre companies are sourcing yarn and fabric from us and getting it processed for their usage.

They are keen to directly source the processed fabric instead and for this purpose the Unit is taking steps to upgrade its dipping facilities so that it can effectively meet the demand for value added products.

Being a very specialised business with limited raw material supplies and a relatively small number of customers, cost competitiveness and quality consciousness are of utmost importance.

The Unit is taking cost reduction measures and making continuous improvements in processes and equipment to ease the pressure on the margins due to increase in prices of inputs as well as energy. The implementation of Total Quality Management is expected to optimize the processes, equipment utilization and reduce wastage.

The dependence on State Electricity Board for additional power is being significantly reduced with the installation of 3.2 MW back pressure turbine for co-generation of power as a by-product from the steam used in the process. In order to further reduce usage of coal and promote "clean" fuel usage, a high pressure multi fuel Fluidized Bed Combustion Boiler is proposed to be installed.

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. 43.59
UK Pound	1	Rs. 85.53
Euro	1	Rs. 58.14

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	8
--PROFITABILIRY	1~10	4
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	7
--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	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		52

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