MIRA INFORM REPORT

Report Date :

03.10.2007

IDENTIFICATION DETAILS

Name :	P I INDUSTRIES LIMITED
Registered Office :	Post Box No. 20, Udaisagar Road, Udaipur – 313001, Rajasthan
Country :	India
Financials (as on) :	31.03.2007
Date of Incorporation :	31.12.1946
Com. Reg. No.:	17-469
CIN No.: [Company Identification No.]	L24211RJ1946PLC000469
TAN No.: (Tax Deduction & Collection Account No.)	JDHP01697D
Legal Form :	Subject is a public limited liability company. The company's shares are listed on the Stock Exchanges.
Line of Business :	Manufacturing and Marketing of Pesticides, Industrial Chemicals and Polymers, etc.

RATING & COMMENTS

MIRA’s Rating :

Aa

RATING		STATUS	PROPOSED CREDIT LINE
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large

Maximum Credit Limit :	USD 2500000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well-established and reputed company whose profit margin is under severe pressure. General Financial position is satisfactory. Payments are reported as correct and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	Post Box No. 20, Udaisagar Road, Udaipur – 313001, Rajasthan, India
Tel. No.:	91-294-2492451-55
Fax No.:	91-294-2491946
E-Mail :	piind@piind.com
Website :	http://www.piind.com
Corporate Office :	4^th Floor, Tower – A, Millennium Plaza, Sector – 27, Gurgaon – 122 022, Haryana, India
Tel. No.:	91-124-5159000
Fax. No.:	91-124-5081247
Plants :	§ Post Box No. 20, Udaisagar Road, Udaipur – 313001, Rajasthan, India Tel. 91-294-2492451-55 Fax. 91-294-2491946 Telex. 0335-202-COMP IN § Plot No. 237, GIDC, Panoli, Ankleshwar, Gujarat, India Tel. No. 91-2646-272105/399 Fax. No.: 91-2646-272313
Regional Offices :	Located at :- Y Agra, Uttar Pradesh Y Kolkata, West Bengal Y Jalandhar, Punjab Y Vijayawada, Andhra Pradesh Y Coimbatore Y Ahmedabad, Gujarat
Branches :	Located at:- Y Cuttack, Orissa Y Patna, Bihar Y New Delhi

DIRECTORS

Name :	Mr. Salil Singhal
Designation :	Chairman and Managing Director
Address :	Lake House, P P Singhal Marg, Udaipur – 313 001, Rajasthan, India
E-Mail:	sls@piind.com
Date of Birth/Age :	21.08.1946
Date of Appointment :	03.12.1984
Name :	Mr. Mayank Singhal
Designation :	Joint Managing Director
Address :	P P Singhal Marg, Udaipur – 313 001, Rajasthan, India
E-Mail:	myk@piind.com
Date of Birth/Age :	03.04.1973
Date of Appointment :	28.09.1998
Name :	Mr. Gautam Ramanlal Divan
Designation :	Director
Address :	134, Mittal Towers, Nariman Point, Mumbai – 400 021, Maharashtra, India
Date of Birth/Age :	22.07.1940
Date of Appointment :	17.02.1998
Name :	Mr. Arvind Singhal
Designation :	Director
Address :	P P Singhal Marg, Udaipur – 313 001, Rajasthan, India
Date of Birth/Age :	29.11.1947
Date of Appointment :	03.12.1984
Name :	Mr. Pradhuman Natvarlal Shah
Designation :	Director
Address :	Maker Bhawan No. 2, 18 new Marine Lines, Mumbai – 400 020, Maharashtra, India
Date of Birth/Age :	01.01.1929
Date of Appointment :	07.09.1990
Name :	Mr. Amiya Kumar Mukherjee
Designation :	Director
Address :	Bunglow No. 20, Amrakadamb Co-operative Housing Society Limited, Ramdev Nagar, Satelite Road, Ahmedabad – 380 015, Gujarat, India
Date of Birth/Age :	11.02.1929
Date of Appointment :	12.03.1993
Date of Ceasing:	30.09.2005
Name :	Mr. Satya Prakash Vishnoi
Designation :	Director
Address :	C 9/9106 Vasant Kunj, New Delhi – 110 070, India
Date of Birth/Age :	23.11.1934
Date of Appointment :	29.01.2004
Name :	Mr. Anurag Surana
Designation :	Whole Time Director
Address :	Ameya Plot No. 1 & 2, B/H Sagar Darshan Apartment, Devali, Udaipur – 313 004, Rajasthan, India
E-Mail:	a.surana@piind.com
Date of Birth/Age :	22.01.1965
Date of Appointment :	30.09.1998
Name :	Mr. Yatin Ajitrai Mankad
Designation :	Nominee Director of IDBI Limited
Address :	IDBI Ahmedabad Branch, IDBI Complex, Near Lal Bungalow CGO Road, Ahmedabad – 380 006, Gujarat, India
Date of Birth/Age :	22.04.1957
Date of Appointment :	08.04.2004
Name :	Mr. G G Agarwal (Doctor)
Designation :	Director – Finance

KEY EXECUTIVES

Name :	Mr. Sanjay Kumar Tiwari
Designation :	Company Secretary
Address :	31C, CPWD Complex, Vasant Vihar, New Delhi – 110 057, India
E-Mail:	Sk.tiwari@piind.com
Date of Birth/Age :	11.09.1973
Date of Appointment :	20.12.2004
Name :	Mrs. Sujata Sharma
Designation :	Secretary
Address :	D – 650, Saraswati Vihar, New Delhi – 110 034, India
Date of Birth/Age :	22.05.1965
Date of Appointment :	24.04.2007

MAJOR SHAREHOLDERS

Names of Shareholders	No. of Shares	Percentage of Holding
Overseas Corporate Bodies	457400	12.91
Promoters	2657579	74.99
Others	428775	12.10
TOTAL	3543754	100.00

BUSINESS DETAILS

Line of Business :

Manufacturing and Marketing of Pesticides, Industrial Chemicals and Polymers, etc.

Products :

Products Description	ITC Code
Insecticides	380810.00
Meterin and Allied Products	902830.00
Polypropylene	390210.00

Exports to :

South Asia, Europe,Japan and Russia.

Imports from :

USA, China, Japan, Europe and Far East

Terms :

Purchasing :

L/C, D/A and D/P (90 days)

GENERAL INFORMATION

No. of Employees :

Around 800

Bankers :

Ø State Bank of India, Udaipur, Rajasthan, India

Ø State Bank of India, Commercial Branch, 6^th Floor, Palm Court, Near MDI, Gurgaon – 122002, Haryana , India

Ø State Bank of Bikaner & Jaipur, Udaipur, Rajasthan, India

Ø ICICI Bank Limited, 9 A, Phelphs Building, Connaught Place, New Delhi – 110001

Ø Canara Bank, New Delhi, India

Ø Canara Bank, Udaipur, Rajasthan, India

Ø Bank of Rajasthan Limited, Udaipur, Rajasthan, India

Ø UTI Bank Limited, 151-152, Chetak Marg, Udaipur – 313001

Facilities :

Secured Loan

(Rs. in millions)

	2005	2004
Term Loans from Financial Institutions/ Banks	395.477	258.883
Working Capital Borrowings	259.082	108.563

Note:

i) Equipment Loans, Vehicle Loans and Equipments purchased under Deferred Payment Guarantees arc; secured by exclusive charge by way of hypothecation of the specific assets purchased under the scheme.

ii) Other term loans are secured on pari passu basis by a joint equitable mortgage through deposit of Title Deeds on all in movable properties and first charge ranking pari passu by way of hypothecation of all movable properties present and future, subject to prior charge in favour of the Company's bankers over the book debts and stocks.

iii) Working Capital Loans are secured on pari passu basis by hypothecation of stocks of raw materials, finished and semi-finished goods, consumable stores and book debts and are additionally secured by a second charge on all the movable and immovable properties of the Company. All the above loans have been guaranteed by two directors of the Company.

Unsecured Loans

(Rs. in millions)

	2005	2004
Loans Interest free Sales Tax Loan	12.527	7.716
Inter Corporate Deposits --From Wholly Owned Subsidiary of the Company --From Others	3.300 13.926	3.137 10.101
Deposits Directors Shareholders Dealers Security Deposits Others	13.922 16.352 34.271 33.883	16.359 15.678 29.741 31.758
Total	128.181	114.490

Banking Relations :

Satisfactory

Auditors :

Ø B. D. Gargieya and Company

Chartered Accountants,

Bank of Rajasthan Building, M I Road, Jaipur – 110065, Rajasthan, India

Ø S. S. Kothari and Company

Chartered Accountants

146 – 149, Tribhuvan Complex, Ishwar Nagar, Mathura Road, New Delhi – 110065, India

Cost Auditors

Ø K. G. Goyal and Company

Chartered Accountants, 8, Chitra Gupta Nagar, Jyoti Nagar Railway Crossing, Jaipur – 302 005, Rajasthan, India

Associates :

Ø Wolkem Limited

It exports Wolkastonite to USA, UK, Germany, Spain, Italy, Japan and South Korea.

Ø Secure Meters Limited

Manufacturer of highly sophisticated and accurate solid state electronic energy meters and energy management systems

Ø Samaya Investment and Trading Private Limited

Ø Parteek Finance and Investment Company Limited

Ø Lucrative Leasing Finance and Investment Company Limited

Ø Binarvi Holding Private Limited

Ø Nansjay Investment Private Limited

Ø Polymeters Response International Limited

Ø Lipi Data Systems

Manufacturers of large size heavy-duty line printers for

computers in technical collaboration with a USA company

Subsidiaries :

# Pill Finance and Investment Limited

Board of Director –

Mr. A K Mukherjee

Mr. Salil Singhal

Mr. Anurag Surana

Mr. R Srinivasan

Banker

ICICI Bank Limited

IDBI Limited

Auditors

Kishan M Mehta and Company

Chartered Accountant

Registered Office –

209, Himalaya Arcade, Near Bharat Petrol Pump, Vastrapur,

Ahmedabad – 380015

# PI Life Science Research Limited

Board of Directors

Dr. S P Vishnoi

Mr. Anurag Surana

Mr. R Srinivasan

Bankers:

UTI Bank Limited

Auditors

K S Mehta and Company

Chartered Accountant

Registered Office:

603 – C, Philips CGHS Limited, Plot No. 3,

Sector – 23, Dwarka, New Delhi - 110075

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
70,00,000	Equity Shares	Rs. 10/-	Rs. 70.000 millions
3,00,000	Preference Shares	Rs. 100/-	Rs. 30.000 millions
	Total		Rs. 100.000 millions

Issued Capital :

No. of Shares	Type	Value	Amount
35, 61, 4115	Equity Shares	Rs. 10/-	Rs. 35.614 millions

Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
35, 43,754	Equity Shares	Rs. 10/-	Rs. 35.438 millions

Note : Of the above Equity Shares : 9,34,749 Equity Shares of Rs.10/- each fully paid up and 122 fractional coupons of Rs. 5/- each fully paid up were allotted as Bonus shares by capitalization of reserves in earlier years.

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.03.2007	31.03.2006	31.03.2005
SHAREHOLDERS FUNDS
1] Share Capital	35.438	35.438	35.400
2] Reserves & Surplus	607.701	563.525	524.200
NETWORTH	643.139	598.963	559.600
LOAN FUNDS
1] Secured Loans	1459.948	952.645	654.600
2] Unsecured Loans	143.061	126.473	128.200
TOTAL BORROWING	1603.009	1079.118	782.800
Deferred Tax Liabilities (Net)	201.700	174.413	0.000
TOTAL	2447.848	1852.494	1342.400
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]	1476.538	1180.833	923.600
Capital work-in-progress	0.000	0.000	8.800
INVESTMENTS	27.141	25.281	13.300
CURRENT ASSETS, LOANS & ADVANCES
Inventories	692.359	596.407	587.500
Sundry Debtors	822.612	468.935	446.600
Cash & Bank Balances	29.911	22.993	25.200
Loans & Advances	238.184	154.757	90.200
Total Current Assets	1783.066	1243.092	1149.500
Less: CURRENT LIABILITIES & PROVISIONS
Current Liabilities	849.316	608.030	755.500
Provisions	0.674	5.330	2.600
Total Current Liabilities	849.990	613.360	758.100
Net Current Assets	933.076	629.732	391.400
MISCELLANEOUS EXPENSES	11.093	16.648	5.300
TOTAL	2447.848	1852.494	1342.400

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
Sales Turnover		3910.801	3269.735	2741.477
Other Income		23.886	20.647	0.000
Total Income		3934.687	3290.382	2741.477
Profit/ (Loss) Before Tax		89.712	72.587	138.404
Provision for Taxation		0.000	0.000	38.800
Profit/ (Loss) After Tax		89.712	72.587	99.604
Export Value		NA	NA	598.813
Import Value		NA	NA	562.097
Expenditures:
	Raw Material consumed	1755.523	1614.277
	Purchases made for re-sale	235.997	19.547
	Consumption of stores and spare parts	39.357	29.792
	Increase or decrease in finished goods, work-in-progress	(14.675)	(67.004)
	Salaries, wages and bonus	255.659	219.041
	Managerial Remuneration	10.597	8.549	2605.729
	Payment of auditors	0.485	0.425
	Interest	139.487	101.597
	Insurance Expenses	14.411	11.962
	Power and Fuel	96.000	89.960
	Depreciation and amortization	86.622	73.142
	Other Expenditure	1225.512	1116.507
Total Expenditure		3844.975	3217.795	2605.729

QUARTERLY RESULTS

PARTICULARS	30.06.2007 (1^st Quarter)
Sales Turnover	818.100
Other Income	2.000
Total Income	820.100
Total Expenditure	726.200
Operating Profit	93.900
Interest	44.800
Gross Profit	49.100
Depreciation	23.700
Tax	4.100
Reported PAT	18.000

KEY RATIOS

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
PAT / Total Income	(%)	2.28	2.21	3.63
Net Profit Margin (PBT/Sales)	(%)	2.29	2.22	5.05
Return on Total Assets (PBT/Total Assets}	(%)	2.75	2.99	6.68
Return on Investment (ROI) (PBT/Networth)		0.14	0.12	0.25
Debt Equity Ratio (Total Liability/Networth)		3.81	2.83	2.75
Current Ratio (Current Asset/Current Liability)		2.10	2.03	1.52

LOCAL AGENCY FURTHER INFORMATION

HISTORY

The company was incorporated on 31^st December, 1946 at Udaipur in Rajasthan under the name and style of Mew Oil & General Mills Limited having Company Registration Number 469. Subsequently, the name of the company was changed to Pesticides India Limited with effect from 01.01.1990.

Again, the name of the company was changed to present.

PILL Finance and Investment is a 100% subsidiary of the company. As a part of its diversification, it has set up a plant to manufacture polyurethane compounds used in the adhesive industry at a project cost of Rs. 23.000 millions and also put up a compounding unit for supplying plastic and polymer moulders.

In the year 1999, the expansion which was undertaken at the company’s plant at Panoli including state of art multi product plant for manufacturing of industrial chemical has been completed and is now fully operational.

The polymer business witnessed a revival and growth in business after a prolonged necessary situation with the industrial climate showing positive trends.

The company Manufactures Pesticides and Insecticides. The company is also engaged in other segments such as Minerals, Metering and Allied Products.

MANAGEMENT DISCUSSION & ANALYSIS:

Industry Structure & Developments: 

Indian Agriculture, which has been passing through a flat phase, has now become a focus area particularly for the Central Government. With the right policy initiatives, Indian Agriculture is capable of delivering a second Green Revolution. The Central Government is actively promoting market driven agriculture, diversification of crops and opening up of the markets. Horticulture (fruits and vegetables) and seeds continue to be future growth areas with adequate support from the government. A National Horticulture Board has also been established. 

With this focus at the policy front, the medium and long term prospects of agriculture are really sound. 

In the short term, the major dependence on monsoon and the poor infrastructure of material movements and markets do have a major impact on agricultural production. 

The monsoon in 2004 was by and large normal with some regional imbalances. Monsoon was particularly beneficial in the Southern part of the country, which reflected in the good agricultural production in the region. 

The seed industry continued its upward trend. Farmers are increasingly adopting hybrid seeds due to the higher yield and better quality of produce. Genetically modified cotton established itself in the market, with several new companies getting approvals, entering the field and expanding the market. However spread of illegal BT cotton seed is a matter of concern for the Industry. 

The patent legislation in line with WTO requirements was adopted with effect from 1^st January, 2005. Given the large number of generics in the market. The impact is expected to be limited during the next few years. However, in the long run Indian companies will need to have access to unique molecules. 

The fine chemical business ail over the world has come under a huge cost pressure due to very large increase in petroleum prices leading to increase in downstream petrochemical product prices. On the other hand, due to a general situation of over supply the selling prices have remained constant leading to erosion in profit margins in most of the chemical companies. The problem in India is compounded due to poor export realizations caused by the strengthening Rupee. 

 On the other hand. Opportunities are always available due to large number of pharmaceutical products coming off patent in the U.S. as also by pursuing right market opportunities. 

Due to changing global consumption trends in the areas of electronics, photography etc. there is a large potential business possibility from companies looking to outsource such performance chemicals like electronic chemicals, photographic chemicals etc. 

The major customer segments of engineering plastic compounds, auto components and the electrical & electronics industry are going through a remarkable growth phase. 

However, most OEMs are demanding lower prices at a time when the prices of steel and other raw materials are soaring. Therefore, compounders must compete with cheaper economies and lower margins. 

Performance: 

The Company continued its growth trend and posted better results, as already indicated. Expansion of geographical reach especially in high growth areas has started showing results. The Company has now established itself in the plantation sector in Southern and Eastern parts of the Country. The plant nutrient segment recorded an impressive growth during the year. 

Major activity was undertaken to enhance training of field staff and improve the distribution network to enlarge the reach of the Company's products. A huge amount has been spent on carrying out extension services and product demonstrations. As a part of their corporate commitment and philosophy the training on safe use of pesticides has been made an integral part of these programmes. 

The Fine Chemical business witnessed a delay in commissioning of the new manufacturing plant which led to the deferment of part of the sales to the next year. 

A significant achievement in the year under review was diversification of the business portfolio of contract manufacturing from mainly agro chemicals to pharmaceutical intermediates and performance chemicals like photographic chemicals, electroplating chemicals etc. 

The company has been successful in contacting several new customers and has generated several inquiries from such customers. The company is very hopeful that these enquiries will result in long term business contracts. The establishing of the company's Japan office has been timely, and business volumes are expected to grow to significant levels in the next three years. 

The Polymer Division clocked sales growth of about 57% in financial year 2004-05 over the previous year. However profit margins continue to be under pressure due to intense competition. 

Outlook: 

The onset of monsoon in 2005 though delayed has been widespread and adequate in most parts of the country. Given the growth strategies, better systems, and new initiatives taken by the company, continued improved performance is expected in the current year.

In light of the new patent regime it is proposed to source new technologies and commercialize them in a phased manner. This will secure the Company's future. 

Further, due to the various initiatives taken, the company expects to finalize new contract manufacturing businesses during the current year. 

Polymer business is targeted to grow by about 30% for the financial year 2005-06 over the previous year of 2004-05. 

To augment its supply chain, it has made toll manufacturing arrangement with one of the leading toll manufacturer near its manufacturing facility at Panoli (Gujarat). It shall also strengthen its marketing team to achieve its budgeted sales targets. 

Given these growth strategies and new initiatives, all round improved performance is expected in the current year. 

SUBSIDIARIES: 

PILL Finance & Investment Ltd. (PILL-F): 

The Company posted a profit of Rs.0.765 millions during the year. 

PI Life Science Research Ltd. (PILSR):

To achieve a better focus in R&D activities, a new subsidiary was established during the year. PILSR has established a state of the art R&D Laboratory and commenced activities during the current year: 

Pursuant to section 212 of the Companies Act, 1956, the Directors' Report and Accounts of the company's subsidiaries, as required, are appended. 

The company's fixed assets of important value include freehold and leasehold land, building, plant and machinery, furniture, fixture and office equipments, vehicles, library, tools and equipments and R & D equipments.

The company is in trade terms with:-

· Kaiser Industries Limited, Delhi

· Mipak Plastics Private Limited, Mumbai

· Maldar Barrels Private Limited, Mumbai

· Paper Plast Industries (India) Private Limited

· Vimal Chemicals, Udaipur, Rajasthan

· Ameeja Enterprises, Mumbai

· Akry Organics (Private) Limited, Mumbai

· Ajay Packaging, Daman

· Jalaram Box Makers Private Limited, Ankleshwar

· Krishna Organics (Private) Limited, Vadodara, Gujarat

· Mineral and Matel Industries, Bhavnagar

· Maharashtra Metal Works Private Limited, Mumbai

· Neogen Chemicals Limited, Thane, Maharashtra

The company's important overseas trading partners are Mitsubishi and Marubeni of Japan.

Website details attached:

PI Industries Ltd is in the business of –Agri inputs, Fine Chemicals (CRAMS - Contract Research and Manufacturing Services), Polymers and Engineering Services.

Founded in 1947 in the city of lakes - Udaipur, Rajasthan (India), it was named PI Industries Ltd in 1993 to reflect its new diversified businesses.

PI is committed to growth, driven by its corporate philosophy, and aims to achieve the highest standards in all its endeavors.

PI’s strength lies in:

More than 30 years of strong business associations with large number of leading multinationals across the globe.

One of the oldest, largest and most credible distribution networks in rural India with some of the leading brands in agri-input sector.

Strong management capabilities, research & development and world class manufacturing infrastructure.

One of the leading companies in Contract Research and Manufacturing Services (CRAMS), having long term tie-ups with leading chemical companies across the globe for newly invented products.

Amongst the top 5 and fastest growing companies in polymer compounding by providing innovative solutions.

News and Events

PI CAP is their quarterly releasing newsletter aiming at providing updation in development, innovation, Opportunities and growth in the company. They have closed the financial year 2006-07 with reasonably good performance. I congratulate every member of PI family for his commitment to the organization. None of this could have happened without the dedication and hard work. As I have said many times, a company is only as good as the people who represent it. It is the commitment to excellence that makes the PI brand shine brighter. Now it's time to look forward. The New Fiscal Year offers excitement, optimism and new opportunities. They have great challenges ahead. In the rapidly changing business environment, they need to keep theirselves abreast of the latest developments happening around us. Globally, the whole world is looking at India for the immense opportunities it offers and locally big corporate are moving into rural areas. They need to create, identify and work on these opportunities. The challenges of the coming year would definitely be much bigger than of yesteryears. What they all require is clarity in objectives, the right attitude and teamwork. Today's challenges will be the stepping stones for tomorrow. And they are growing as a team. I see many new faces with a mix of young blood and vast experienced talent pool of varied backgrounds. I trust that with this energetic talent pool, they will be able to establish the new benchmarks in corporate excellence. In addition to show good business performance and corporate governance, it is also important to be aware about the social purpose of being in business. They must keep educating their farmers on the safe and judicious use of agrochemicals as a part & parcel of their corporate social responsibility. It is important that they continue with these initiatives. They should also be available to fulfill their social responsibilities. The reverse count for the year is on! I hope, by the time you will receive my message you would have started delivering towards new heights. Once again, I wish you a great and successful New Financial Year on both the personal and the professional front.

National Energy Conservation Award-2006

It was a proud moment for PI family on December 14, 2006, when their Panoli Team comprising of Vivek Srivastava, Vipul Parikh, D. Bhowmik and R.K. Tiwari, led by D. K. Ray, received the prestigious National Energy Conservation Award from Shri. Sushil Kumar Shinde, Union Minister of Power, Government of India, in a ceremony held at Vigyan Bhavan, New Delhi. Awards were distributed on the occasion of National Energy Conservation Day to the companies who have implemented best practices for Energy Conservation, continuously for the past three years, resulting in substantial returns in terms of energy conservation.

PI received this prestigious award in recognition of consistent and continual improvement in the area of power, fuel and resource utilization. With this award, their company has come into the list of energy efficient companies of the country.

Founder's Day 2007

Once again all Group Companies joined their hands together on February 13th in commemoration of Founder’s Day. The celebrations were carried out at various locations across India. In Udaipur, the day begun with puja and abhishek of the statue of their founder, Late Shri. P. P. Singhal. The program was followed by sports activities and fun games. The employees of group companies – Secure Meters and Wolkem India also participated in the activities with great enthusiasm. All the sports activities and fun games were held at company premises. All groups of employees irrespective of their cadre, age took part in the various activities and enjoyed their participation. In evening, a grand cultural show was organized in Bhartiya Lok Kala Mandal. The program started with the address of their CMD, Mr. Salil Singhal. During the program employees were felicitated by mementos and certificates for their long association with the company by their Chairman Mr. Salil Singhal and Mr. Arvind Singhal (MD, Wolkem India Ltd.). The highlight of the Cultural Show was a Drama named “Kashmkash” performed by the artists of IPTA, Mumbai likes of Anjan Srivastava, Avtar Gill and Sulbha Arya which was well appreciated by all. The Program ended with Vote of Thanks by Mr. Sanjay Singhal (MD, Secure Meters Ltd.) In the same line of celebrations, the Founder's day was celebrated at Panoli, Jammu and Gurgaon. In Gurgaon, employees with their family members participated in the celebration marked by fun and Games. The event was organized at Unitech Country Club, Gurgaon. In Panoli, cultural and sports activities were organized in company's premises to mark the day. Jammu employees also showed enthusiasm in celebrating the Founder's day by having a cultural trip.

Mr. Salil Singhal Elected as Deputy Chairman, CII (Northern Region)

Their CMD, Mr. Salil Singhal has been elected as Deputy Chairman of Confederation of Indian Industry (Northern Region). He was the member of the Rajasthan State Council of CII for two years and has been the member of Northern Region Council for the past ten years. CII is a non-government, not-for-profit, industry led and industry managed organisation, playing a proactive role in India's development process. Founded over 111 years ago, it is India's premier business association, with a direct membership of over 6300 organisations from the private as well as public sectors, including SMEs and MNCs, and an indirect membership of over 90,000 companies from around 336 national and regional sectoral associations.

The Northern Region (CII) comprises of the states of J&K, Himachal Pradesh, Punjab, Haryana, Delhi, UP, Uttarakhand and Rajasthan.

CMD Visits Japan as a Part of Prime Minister’s Delegation

Their CMD, Mr. Salil Singhal was invited to accompany their Hon'ble Prime Minister Shri. Man Mohan Singh as part of his delegation on his official visit to Japan from 14- 16th December, 2006. Visit was part of the increasing Eastern orientation of India's foreign policy exploring potential of convergence of both countries' long-term political, economic and strategic interests. Being part of the businessmen’s delegation, their CMD met with many Japanese businessmen and exchanged views to further their business interests.

Activities at PI Udaipur

PI Industries Udaipur is making regular efforts not only towards achieving the professional target but also getting attached with the hearts of employees by organizing various activities. The major activities conducted during the last quarter at Udaipur were Christmas celebration, New year eve celebration, Participation in ”Run For IIT” rally. Besides there is monthly celebration of birthdays of the employees having a cake cutting ceremony followed by Hi-tea programme.

Christmas Celebration: The celebration of “Christmas”, which turned out to be very merry and bright one! Moti Singh (Security Guard) in the Santa dress looked awesome!! Absolute copy of Santa……..Santa distributed Sweets and his blessings to all the team members of PI and spread warmth in the cold winter!!

New Year Eve Celebration: On New Year eve, PI Udaipur held two celebrations one was New Year's celebration and other was December month Birthdays Celebration. Mr. Anurag Surana, Director addressed the team on this occasion and extended his best wishes to all team member for prosperous, happier and healthier New Year. He also welcomed the new joinees on this occasion and asked everyone to take a resolution for a better tomorrow and commitment to make their Company ‘The Best Place’.

PI Fine Chem - A Trusted Name In Japanese Chemical companies

India is getting increasing attention from Japan for custom manufacturing of agrochemicals & its' intermediates, API's & pharmaceutical intermediates, specialty chemicals and fine chemicals. PI Fine Chem is also getting more inquiries due to the excellent reputation it has built over the years. PI Fine Chem successfully made on-time and good quality commercial supplies of a new product in the last quarter to Europe. This project was completed in a record time. Due to the performance PI Fine Chem is getting overwhelming response from across the globe. It is already working on a number of projects in collaboration with some of the very large European, Japanese and American companies, where it is becoming increasingly popular.

PI at CPhI Tokyo

PI Fine Chem participated in the CPhI Japan held at Tokyo Big Site from April 18 to 20, 2007. This was their fifth participation in a row at CPhI Tokyo.This year India was the focus country at CPhI Tokyo and there was a special India pavilion where 44 Indian companies were present as exhibitors. This number is next only to Japan (168 exhibitors) and China (84 exhibitors). The number of visitors to the CPhI in three days was 13,374. The number of visitors to their booth was considerably higher than previous years. Many of their existing customers visited their booth to discuss about ongoing projects as well as new inquiries. Some new customers also visited their booth and showed keen interest in PI Fine Chem and wanted to know more about their custom manufacturing capabilities and strengths. Some of them gave us new inquiries for custom manufacturing. They have since initiated work on these new inquiries in their R & D.

Mr. Toshiaki Hashimoto, President PI Fine Chem Japan, also made a detailed presentation titled, “Creation and Practice of Contract Research and Manufacturing Model for Japanese Customers”. During the presentation Mr. Hashimoto emphasized upon the various advantages offered by PI Fine Chem, particularly in the field of Custom Synthesis and Contract Manufacturing. The presentation was attended by more than 120 senior persons representing prominent chemical industries of Japan.

Japanese Business Delegation visits Panoli FC Facility

Chemical Daily, a major news paper dedicated to chemical industry in Japan, organized visit of a large Japanese business delegation to their Panoli works on 29th November 2006. The delegation was in India to attend “CPhI India”, held at Mumbai in December 2006. The delegation comprised of representatives of leading Chemical Companies in Japan. The delegation was impressed to see the infrastructure & capabilities, high safety standards, quality systems and their documentation, good house keeping practice and discipline among the employees.

Latest Developments in Fine Chem Business

During the quarter that ended on March 2007, they received 16 new inquiries out of which 14 were found worth investigating and work is in progress at various stages. Their process development team at kilo lab, Udaipur, has worked on the scale up study and synthesis of 5 new molecules which shall be commercialized within 2007-08. Apart from these, one new product was commercially produced and supplied in the quarter ended March 2007. High level business delegations from large multinational companies from Japan, Europe & USA visited their R&D center at Udaipur and commercial manufacturing facility at Panoli.

22/12/2006 - PI at CPhI Worldwide - Paris 2006

PI at CPhI Worldwide - Paris 2006

PI Fine Chem had yet another successful participation in CPhI Worldwide this year. CPhI is the world's largest international convention on pharmaceutical ingredients and intermediates held every year. This year it was held at Nord Villepinte, Paris from 3rd - 5th October 2006. This was their fourth consecutive participation in CPhI world wide. In the previous years they had participated in CPhI held at Madrid, London and Frankfurt. Two allied exhibitions - ICSE - the International Contract Services Expo and P-MEC - the Pharmaceutical Machinery and Equipment Congress were also set up as a part of the mega event. This tripartite of events allowed visitors to indulge in the complete one-stop -shopping experience for every part of their pharmaceutical manufacturing business.

The overall participation this year was much better than last year. This year over 1,500 exhibitors of API's, intermediates, excipients and other fine and specialty chemicals participated in the fair. A large number of visitors, to the tune of 21000, visited the fair.

This event had a number of specialist pavilions, to enable attendees to meet company representatives from specific countries specializing in specific products of their interest. In addition there were a number of geographically targeted pavilions from Brazil, China, France, Japan, Korea, Argentina, India, USA, and Portugal. A special area for biopharmaceutical manufacturing sector, BioTech HotSpot, exhibited some of the world's leading suppliers in this burgeoning market. During the course of CPhI Worldwide 2006 there was a comprehensive programme of showcases from many of the exhibitors. These free sessions presented an opportunity to find out more from many of the leading practitioners in the pharmaceutical manufacturing industry. The third edition of CPhI Innovation Awards gave the visitors an opportunity to listen to the final presentations by the short listed nominees in advance of the judges deliberations. The winners were announced at a special reception on the evening of 3rd October.

Eminent people from different countries like Brazil, China, France, Germany, Japan, Switzerland, Korea, Argentina, India, USA etc visited their booth and showed keen interest in PI Fine Chem. Their participation in the coveted event helped us in highlighting their presence in the international Fine chemicals market, in building new business contacts and in strengthening the old ones. In Addition to this it also gave us valuable insight into the ongoing advanced developments in fine chemicals sector.

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

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	7
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	7
--LIQUIDITY	1~10	7
--LEVERAGE	1~10	7
--RESERVES	1~10	7
--CREDIT LINES	1~10	7
--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		63

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

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

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

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions