MIRA INFORM REPORT

Report Date :

03.10.2007

IDENTIFICATION DETAILS

Name :	H M PIPES PRIVATE LIMITED
Registered Office :	A – 95, Suraj Nagar (East), CIIL Lines, Jaipur 302 006, Rajasthan
Country :	India
Financials (as on) :	31.03.2006
Date of Incorporation :	21.06.2000
Com. Reg. No.:	17-16489
CIN No.: [Company Identification No.]	U25203RJ2000PTC016489
TAN No.: [Tax Deduction & Collection Account No.]	JPRH02325B
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacturer and Supplier of Poly Ethylene Pipes.

RATING & COMMENTS

MIRA’s Rating :

B

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average.	Small

Maximum Credit Limit :	USD 45144
Status :	Moderate
Payment Behaviour :	Slow by average 40 days
Litigation :	Clear
Comments :	Subject is an established company having moderate track. Trade relations are fair. General financial position is moderate. Payment are reported as slow but correct. The company can be considered for small to mediocre business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	A – 95, Suraj Nagar (East), CIIL Lines, Jaipur 302 006, Rajasthan, India
Mobile No.:	91-9414059336
E-Mail :	hmpipes@hotmail.com choudharychetan@indiatimes.com
Corporate Office :	F – 62, Kartarpura Industrial Area, Jaipur 302 006, Rajasthan, India
Tel. No.:	91-141-2210033
Fax No.:	91-141-2210033

DIRECTORS

Name :	Mrs. Kamla Singh
Designation :	Director
Address :	A – 59, Suraj Nagar, Civil Lines, Jaipur 302 006, Rajasthan, India
Date of Birth/Age :	01.01.1967
Date of Appointment :	21.06.2000
Name :	Mr. Vijay Narayan Katiyar
Designation :	Director
Address :	63, Patel Nagar, Jaipur 302 006, Rajasthan, India
Date of Birth/Age :	06.03.1937
Date of Appointment :	21.06.2000
Name :	Mr. Chetan Choudhary
Designation :	Director
Address :	A – 59, Suraj Nagar, Civil Lines, Jaipur 302 006, Rajasthan, India
Date of Birth/Age :	18.03.1972
Date of Appointment :	21.06.2000
Name :	Mrs. Anita Katiyar
Designation :	Director
Address :	63, Patel Nagar, Jaipur 302 006, Rajasthan, India
Date of Birth/Age :	11.04.1969
Date of Appointment :	21.06.2004

KEY EXECUTIVES

Name :	Godha Vinita and Associates Chartered Accountants
Designation :	Company Secretary
Address :	B-25, Chhatri Yojana, Vaishalli Nagar, Ajmer, Rajasthan, India
Date of Birth/Age :
Qualification :
Experience :
Date of Appointment :

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

Names of Shareholders	No. of Shares
Mrs. Kamla Singh	148600
Mr. Vijay Narayan Katiyar	22600
Mr. Chetan Choudhary	110800
Mrs. Anita Katiyar	4900
Mr. Vivek Katiyar	24423
Mr. Vimal Katiyar	15000
Mr. Major Mohan Singh	70000
Mr. Moti Ram	10500
Mr. Rajeshji Jakhad	10000
Mr. Manphoolji Godara	10000
Mr. Amarji Godara	10000
Mr. Rajendraji	10000
Mr. Mangalji Godara	10384
Mr. Jaswantji Jakhad	10000
Mr. Surendraji Godara	10000
Mr. Ram Pratapji	10000
Mr. Arunji	11325
Mr. S S Gurjar	10000
Mrs. Meera Choudhary	2500
Mr. Vishal Tilak	9668
Mr. Mahaveerji	5600
Mr. Kulveer	2000
Mr. Ram Niwasji	5000
Mr. Shiv Ramji	4000
Mr. Prakashji Latiyal	6300
Mr. Shobh Raj Latiyal	4500
Mr. Rajneeshji Jhakad	4500
Mr. Chaju Lal Kumawat	3000
Mr. Mohan Lal	10000
Mr. Vimal Katiyar	6000
Mr Khiyaran Ramji	3000
Mr. Mewa Ramji	3000
Total	580300

Equity share breakup (percentage of total equity)

S. No.	Category	Percentage
1	Directors or relatives of directors	56.00
2	Other top fifty (50) shareholders (other than listed above)	44.00
	Total	100.00

BUSINESS DETAILS

Line of Business :	Manufacturer and Supplier of Poly Ethylene Pipes.
Products :	Ø HDPE Pipes Ø PDPE Pipes Ø PPR Pipes Ø Sprinkler Systems Ø PLB HDPE Ducts Ø HDPE Pipes and Coils Ø HM Pipes for Gas Appliations Ø MDPE Pipes Ø PLB / PPR Pipes and Fittings Ø HDPE Sprinkler Systems

GENERAL INFORMATION

No. of Employees :	50
Bankers :	Allahabad Bank, M I Road, Jaipur 302 001, Rajasthan, India

Banking Relations :	Satisfactory
Auditors :
Name :	Vishnu Khandelwal and Company Chartered Accountants
Address :	449, Bandri Ka Nasik, Jaipur 302 002, Rajasthan, India

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
1000000	Equity shares	Rs. 10/- each	Rs. 10.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
580300	Equity shares	Rs. 10/- each	Rs. 5.803 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2006	31.03.2005
SHAREHOLDERS FUNDS
1] Share Capital		5.803	5.803
2] Share Application Money		2.500	0.000
3] Reserves & Surplus		2.983	0.800
4] (Accumulated Losses)		0.000	0.000
NETWORTH		11.286	6.603
LOAN FUNDS
1] Secured Loans		22.886	14.625
2] Unsecured Loans		6.285	3.206
TOTAL BORROWING		29.171	17.831
DEFERRED TAX LIABILITIES		1.685	1.392
TOTAL		42.142	25.826
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		19.951	10.211
Capital work-in-progress		0.000	0.000
INVESTMENT		0.000	0.000
DEFERREX TAX ASSETS		0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	5.827	8.376
	Sundry Debtors	41.267	12.524
	Cash & Bank Balances	6.919	3.013
	Other Current Assets	0.000	0.000
	Loans & Advances	4.705	4.207
Total Current Assets		58.718	28.120
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	36.527	12.417
	Provisions	0.000	0.108
Total Current Liabilities		36.527	12.525
Net Current Assets		22.191	15.595
MISCELLANEOUS EXPENSES		0.000	0.020
TOTAL		42.142	25.826

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2006	31.03.2005
Sales Turnover		120.262	58.081
Total Income		120.262	58.081
Profit/(Loss) Before Tax		2.704	1.317
Provision for Taxation		0.521	0.712
Profit/(Loss) After Tax		2.183	0.605
Expenditures :
	Cost of Goods Sold
	Manufacturing Expenses
	Administrative Expenses
	Raw Material Consumed
	Purchases made for re-sale
	Consumption of stores and spares parts
	Increase/(Decrease) in Finished Goods
	Salaries, Wages, Bonus, etc.	117.558	56.764
	Managerial Remuneration
	Payment to Auditors
	Interest
	Insurance Expenses
	Power & Fuel
	Depreciation & Amortization
	Other Expenditure
Total Expenditure		117.558	56.764

KEY RATIOS

PARTICULARS		31.03.2006	31.03.2005
PAT / Total Income	(%)	1.81	1.04
Net Profit Margin (PBT/Sales)	(%)	2.24	2.26
Return on Total Assets (PBT/Total Assets}	(%)	3.43	3.43
Return on Investment (ROI) (PBT/Networth)		0.23	0.19
Debt Equity Ratio (Total Liability/Networth)		5.82	4.59
Current Ratio (Current Asset/Current Liability)		1.60	2.24

LOCAL AGENCY FURTHER INFORMATION

Corporation identity number or foreign company registrations number of the company	U25203RJ2000PTC016489
Name of the company	H M PIPES PRIVATE LIMITED
Address	A – 95, Suraj Nagar (East), CIIL Lines, Jaipur 302 006, Rajasthan, india
This Form is for	Modification of charge
Type of Charges	Immovable property, Book debts
Particular of the charge holder	Allahabad Bank, M I Road, Jaipur 302 001, Rajasthan, India ALBJPMAIN@SANCHARNET.IN
Nature or description of the instrument creating charge	General letter of hypothecation
Date of the instrument creating charge	25.01.2007
Amount Secure by the charge	Rs. 20.000 millions
Brief of the principal terms and conditions and extent and operation of the charge	a) Rate of Interest: 0.5% over PLR which is presently 12% with monthly rest b) Terms of Repayment: On demand c) Margin: 25% d) Extent and operation of the charge: As per agreement attached
Particulars of the Property charged	As per annexure a of sanction letter attached
Particulars of Present Modification	Limit has been enhanced to Rs. 20.000 millions

Name of the company

H M PIPES PRIVATE LIMITED

Presented By

DIRECTOR, H M PIPES PRIVATE LIMITED AND

ALLAHABAD BANK, M I ROAD BRANCH, JAIPUR

1) Date and description of instrument creating the change

1. General letter of Hypothecation dated 02.02.2005 for Rs. 11.250 millions

2. letter of Mortagage of condirmation deposit of title deeds.

2) Amount secured by the charge/amount owing on the securities of charge

Particulars	(Rs. In Millions)
Cash Credit (Hypothecation)	8.250
Bank Guarantee	3.000
Total	11.250

3) Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given

a) First charge by way of hypothecation of all stock of raw material, work in progress, semi – finished goods and finished goods such as HDPE Granules and HDPE pipes spares etc. whatsoever situated and or in transit whether now belonging to or that may at any time during the continues of these securities belong to the company or that may be held by any party anywhere to the order or and disposition of the company.

b) All the present and future Book Debts, outstanding moneys, receivables, claims, bills, invoice, documents, contracts, engagement, securities, investments, rights hypothecation to the bank.

c) Equitable Mortgage on all immovable properties and fixed assets of the company both present and future comprising factory land and building situated at G-47 and 48, RIICO Industrial Area, Bagru Extension, and District Jaipur.

d) The Entire limit is further secured by personal guarantee of all directors.

4) Gist of the terms and conditions and extent and operation of the charge.

Interest on present limit @ PLR plus 2.00 % p. a. with monthly rest with the minimum of 13% p. a.

Margin

Stock – 25%

Book debts (up to 90 days) 25%

Repayable on demand

Interest on Bank Guarantee @ 2% p. a. on performance guarantee and 3% on financial guarantee

Cash Margin 25% on Bank Guarantee

5) Name and Address and description of the person entitled to the charge.

Allahabad Bank

M I Road Branch, Jaipur

6) Date and brief description of instrument modifying the charge

Hypothecation Agreement dated 21.09.2005

7) Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.

The existing limits are further enhanced, the details of which are as under

	(Rs. In Millions)
Particular	Present	Enhanced
Cash credit (hypothecation)	8.250	13.750
	3.000	7.500
Total	11.250	21.250

Other terms and conditions are as under

a) First charge by way of hypothecation of all stock of raw material, work in progress, semi – finished goods and finished goods such as HDPE Granules and HDPE pipes spares etc. whatsoever situated and or in transit whether now belonging to or that may at any time during the continues of these securities belong to the company or that may be held by any party anywhere to the order or and disposition of the company.

b) All the present and future book debts, outstanding moneys, receivables, claims, bill, invoice, documents, contrast, engagement, securities, investments, rights hypothecation to the bank.

c) Equitable Mortgage on all Immovable properties and Fixed Assets of the company both present and future comprising factory land and building situated at G -47 and 48, RIICO Industrial Area, Bagru Extension, District Jaipur

d) The entire limit is further secured by personal guarantee of al directors.

e) Interest on present limit @ PLR plus 0.50% p. a. with monthly rest with the minimum of 11.50% p. a.

Margin

Stock 25%

Book debts (upto 90 days)25%

Repayable on Demand

Interest on Bank Guarantee @ 2% p. a. on performance guarantee and 3% on financial guarantee.

Cash margin 25% on Bank Guarantee

As Per Web Details:

About Them

Subject is an ISO 9001: 2000 certified company, catering to the domestic market as a manufacturer and supplier. Established in the year 2000, they have carved a niche in the arena of  poly ethylene pipes. They are committed with the objective to manufacture products of the highest standards and to build a long-term relationship with their elite customers. Their range of products includes poly ethylene pipes including HDPE pipes, PDPE pipes, PPR pipes, and sprinkler systems. All their pipes have wide application in various industries, and their sprinkler systems are used for irrigation purposes.

 The company's factory is situated at RIICO Bagru Industrial Area, Phase II, Jaipur. They are equipped with the most modern pipe extrusion plant supplied by brands like Kolsite (in collaboration with Battenfeld of Germany) and Windsor (in collaboration with DGP). All the products manufactured at their unit are certified as per the various IS Standards laid down by the Bureau of Indian Standard.

Quality Assurance

Quality is the hallmark at subject Stringent quality assurance at all levels right from the incoming raw materials to the manufacture of the finished products has helped them in maintaining the highest standards of qualitative products and customer satisfaction. A team of qualified professionals monitors the entire manufacturing process to guarantee flawless output. The list of their increasing number of valued clients speaks volumes about the standards being maintained in all respects.

Environmental Concern

The company is committed to keeping the environment clean. The plant is equipped to ensure that the environment is not harmed in any manner. Besides the environment-friendly production facilities, the company manufactures leak free piping systems, all aimed towards keeping the environment safe and clean.

Their Strength

Subject has gained a competitive edge in the market owing to various factors, few of which are as

follows:

Ø A sound infrastructure armored with advanced and innovative technology

Ø Continual improvements in the quality of their line of products

Ø Adherence to the industrial norms and international quality standards

Ø Best products in the market meant to provide maximum utility to the end user   

Ø Sound business practices and customer centric approach

Ø Successful execution of small as well as bulk orders

Ø Affordable prices and timely delivery, leaving no room for customer grievances.

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.39.56
UK Pound	1	Rs.80.30
Euro	1	Rs.55.76

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	3
--PROFITABILIRY	1~10	3
--LIQUIDITY	1~10	4
--LEVERAGE	1~10	4
--RESERVES	1~10	4
--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	NO
--AFFILIATION	YES/NO	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	NO
TOTAL		37

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.	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