MIRA INFORM REPORT

Report Date :

18.09.2007

IDENTIFICATION DETAILS

Name :	SHREE KRISHNA PAPER MILLS AND INDUSTRIES LIMITED
Registered Office :	16, India Exchange Place, Kolkata – 700 001, West Bengal
Country :	India
Financials (as on) :	31.03.2006
Date of Incorporation :	14.09.1972
Com. Reg. No.:	21-28518
CIN No.: [Company Identification No.]	U21012WB1972PTC028518
TAN No.: [Tax Deduction & Collection Account No.]	DELS07824F
PAN No.: [Permanent Account No.]	AADCS5248Q
Legal Form :	It is a public limited liability company. The company’s shares are listed on the Stock Exchanges.
Line of Business :	The company is engaged in manufacture of Coated Paper, Chromo / Art, Ivory Card, Enamel Paper, Thermal Sensitive Paper, Fax Paper, Art Board, Self Copy Paper, etc.

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 700000
Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject is a well-established and reputed company having satisfactory track. Directors are reported as experienced and respectable businessmen. Trade relations are reported as fair. Business is active. Payments are usually correct and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	16, India Exchange Place, Kolkata – 700 001, West Bengal, India
Tel. No.:	91-11-328 6987 / 6988/ 22203436, 22205219
Fax No.:	91-11-3266708 / 91-033-22104208
E-Mail :	skpm@vsnl.com info@skpmil.com skpmil@ricmail.com manish_co@hotmail.com
Website :	http://www.skpmil.com
Corporate Office / Head Office :	4830/24, Prahlad Street, Ansari Road, Darya Ganj, New Delhi – 110 002, India
Tel. No.:	91-11-3261728 / 7253, 91 11 23261728, 91 11 23267253
Fax No.:	91-11-3266708
Factory 1 :	T/4, Industrial Area, Bahadurgarh – 124 507, Haryana, India
Tel. No.:	91-1191-342585 / 343487 / 342489
Fax No.:	91-1191-343245
Sales office :	Delhi 4830/24, Prahlad Street, Ansari Road, Daryaganj, New Delhi - 110 002 Mumbai Nirman Kendra, Unit No. 104, 1^st Floor, Dr. E. Moses Road, Famous Studio Lane, Mahalaxmi, Mumbai - 400 011 Kolkata 16, India Exchange Place, Kolkata - 700 001
Branches :	Nirman Kendra, Unit No. 104, 1^st Floor, Dr. E. Moses Road, Famous Studio Lane, Mahalaxmi, Mumbai - 400 011
Tel. No.:	91-22-56603611/ 91-22-24970177
Fax No.:	91-22-56603610

DIRECTORS

Name :	Mr. N. K. Pasari
Designation :	Managing Director
Name :	Mr. B. N. Pasari
Designation :	Director
Name :	Mr. B. K. Pasari
Designation :	Director
Name :	Mr. Naynesh Pasari
Designation :	Director
Name :	Mr. Ajay Kumar Jhunjhunwala
Designation :	Director
Name :	Mr. D. R. Mehta
Designation :	Director
Name :	Mr. L C Sharma
Designation :	Director
Name :	Mr. Alok Sinha
Designation :	Director

KEY EXECUTIVES

Name :	Mr. M. P. Garg
Designation :	Company Secretary
Name :	Shri D K Chanda
Designation :	President (Coating Plant)
Name :	Shri A.K. Sharma
Designation :	Sr. Vice President (L&CA)
Name :	Shri S.K. Agarwal
Designation :	Chief General Manager (Paper Division
Name :	Shri J. Nagarajan
Designation :	Chief Manager (Project Coord.)
Name :	Wg. Cdr. K.C. Varma
Designation :	Senior Manager (HRD)
Name :	Shri S.C. Bhardwaj
Designation :	General Manager (Development)
Name :	Shri A.K. Raina
Designation :	Works Manager

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

Names of Shareholders	No. of Shares	Percentage of Holding
Shareholding of Promoter and Promoter Group 2
Indian
Individuals/ Hindu Undivided Family	989600	12.29
Bodies Corporate	4740480	58.88
Non-Institutions
Bodies Corporate	1572822	19.53
Individuals –
Individual shareholders holding nominal share capital up to Rs. 0.100 Million	607674	7.55
Individual shareholders holding nominal share capital in excess of Rs. 0.100 Million	141104	1.75
TOTAL	8051680	100

BUSINESS DETAILS

Line of Business :

The company is engaged in manufacture of Coated Paper, Chromo / Art, Ivory Card, Enamel Paper, Thermal Sensitive Paper, Fax Paper, Art Board, Self Copy Paper, etc.

Products :

Item Code No.	Product Description
481011.02	Art Paper
481012.01	Art Board
481620.02	Self Copy Paper

PRODUCTION STATUS

Particulars	Unit	Installed Capacity
Coated Paper	Tons	12000
Thermal Sensitive Paper	Tons	2000
Waste Paper	Tons	--
Paper	Tons	--

GENERAL INFORMATION

Suppliers :	v A-One Hydraulics, Friends Cable Industries v Universal Engineering Corporation v Alfa Minerals & Chemicals v S. K. Beri & Bros v Gemco Controls Limited
No. of Employees :	524
Bankers :	v Bank of India v Punjab National Bank

Banking Relations :	Satisfactory
Auditors :
Name :	v Singal Brothers & Associates Chartered Accountants New Delhi, India v A. C. Bhuteria & Company Chartered Accountants Kolkata , West Bengal

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
15000000	Equity Shares	Rs. 10/- each	Rs. 150.000 Millions
500000	Equity Shares	Rs. 100/- each	Rs. 50.000 Millions
	Total		Rs. 200.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
8015680	Equity Shares	Rs. 10/- each	Rs. 80.517 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2006	31.03.2005	31.03.2004
SHAREHOLDERS FUNDS
1] Share Capital		80.500	80.516	80.516
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		95.300	93.951	81.635
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		175.800	174.467	162.151
LOAN FUNDS
1] Secured Loans		284.000	67.213	23.877
2] Unsecured Loans		53.700	52.939	49.117
TOTAL BORROWING		337.700	120.152	72.994
DEFERRED TAX LIABILITIES		0.000	22.730	19.850
TOTAL		513.500	317.349	254.995
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		446.000	217.540	110.503
Capital work-in-progress		16.800	78.013	112.655
INVESTMENT		0.200	0.173	0.173
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	51.200	28.549	30.123
	Sundry Debtors	21.100	25.320	23.458
	Cash & Bank Balances	21.700	12.531	20.998
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	69.400	15.325	9.684
Total Current Assets		163.400	81.725	84.263
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	112.900	59.833	53.451
	Provisions	0.400	1.361	1.527
Total Current Liabilities		113.300	61.194	54.978
Net Current Assets		50.100	20.531	29.285
MISCELLANEOUS EXPENSES		0.400	1.092	2.379
TOTAL		513.500	317.349	254.995

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2006	31.03.2005	31.03.2004
Sales Turnover		677.600	679.800	683.600
Other Income		1.300	0.900	1.300
Stock Adjustments		2.900	0.500	[2.300]
Total Income		681.800	681.200	682.600
Profit/(Loss) Before Tax		6.900	16.700	0.600
Provision for Taxation		5.700	4.300	0.300
Profit/(Loss) After Tax		1.200	12.400	0.300
Earnings in Foreign Currency :
Total Earnings		2.357	4.667	2.172
Imports :
Total Imports		NA	36.539	19.829
Expenditures :
	Raw Materials	464.500	461.300	445.100
	Excise Duty	0.000	0.000	0.000
	Power & Fuel Cost	38.200	37.300	35.100
	Other Manufacturing Expenses	15.300	18.700	16.600
	Employee Cost	33.900	29.000	27.700
	Selling and Administration Expenses	90.600	97.000	139.800
	Miscellaneous Expenses	2.800	3.500	3.700
	Interest & Financial Charges	9.500	4.900	5.100
	Depreciation	20.100	12.800	8.900
Total Expenditure		674.900	664.500	682.000

SUMMARISED RESULTS

PARTICULARS	31.03.2007
Type	Full Year
Sales Turnover	802.300
Other Income	2.000
Total Income	804.300
Total Expenditure	776.900
Operating Profit	27.400
Interest	43.300
Gross Profit	[15.900]
Depreciation	45.000
Tax	0.700
Reported PAT	[63.800]
Dividend (%)	0.000

QUARTERLY RESULTS

PARTICULARS	30.06.2007
Type	1st Qtr
Sales Turnover	215.800
Other Income	0.400
Total Income	216.200
Total Expenditure	204.100
Operating Profit	12.100
Interest	14.400
Gross Profit	[2.300]
Depreciation	11.700
Tax	0.100
Reported PAT	[14.100]

200706 Quarter 1 –

Expenditure Includes (Increase) / Decrease in Stock in Trade Rs (17.491) million Consumption of Raw Materials Rs 163.862 million Staff Cost Rs 15.876 million Other Expenditure Rs 41.761 million Tax Indicates Provision for Current Tax including FBT Status of Investor Complaints for the quarter ended June 30, 2007 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. The above Financial Results were reviewed by the Audit Committee and approved by the Board of Directors at their meeting held on July 30, 2007. 2. The above results are subject to 'Limited Review' by the Statutory Auditors of the company as per the listing agreement with the Stock Exchange. 3. Provision for Deferred fax Liability / Assets will be made at the end of the year. 4. Previous period figures have been re-grouped/rearranged wherever necessary.

KEY RATIOS

PARTICULARS	31.03.2006	31.03.2005	31.03.2004
Debt-Equity Ratio	1.31	0.57	0.43
Long Term Debt-Equity Ratio	1.14	0.45	0.26
Current Ratio	0.96	0.82	0.84
TURNOVER RATIOS
Fixed Assets	1.41	2.29	2.87
Inventory	17.00	23.20	22.52
Debtors	29.21	27.86	30.25
Interest Cover Ratio	1.73	4.41	1.18
Operating Profit Margin(%)	5.39	5.06	2.18
Profit Before Interest And Tax Margin(%)	2.42	3.18	0.88
Cash Profit Margin(%)	3.14	3.71	1.26
Adjusted Net Profit Margin(%)	0.18	1.82	-0.04
Return On Capital Employed(%)	4.07	8.21	2.73
Return On Net Worth(%)	0.69	7.37	-0.19

STOCK PRICES

Face Value	Rs.10.00/-
High	Rs.[0.01]
Low	Rs.[0.01]

LOCAL AGENCY FURTHER INFORMATION

HISTORY

Shree Krishna Paper Mills & Industries, established in 1972 turned public from private in 1986. Till Oct '86, the company functioned in it's original incorporated name Shree Krishna Paper Products Private Limited The company manufactures Paper, Coated paper, Thermal Sensitive paper. The company manufactures various types of coated papers which include chromo paper and art paper. It sells its products under the Senso Cote and Silver Cote brand names. 

In 1974, the company took over a paper unit located at Bahadurgarh from Bansal Paper Mills. The company then undertook a major modernisation programme. Over the years, the company has increased its capacity to 12,000 tpa.  

The company, in 1989, acquired Bhargava Papers Private Limited which has a unit at Ghaziabad, Uttar Pradesh. This manufacturing unit is non-operational at present. The company decided to acquire this unit to expand its existing activities but, at a later date, an additional plot of land adjacent to the existing plant at Bahadurgarh, Haryana, was purchased by it. Since it was not logical to have two sets of similar organisations and manufacturing facilities in two different places, it decided to dispose off this unit to concentrate on the diversification and expansion plans at the Bahadurgarh unit.  

Shree Krishna Paper Mills came out with a Rs 43.700 Millions public issue in 1995 to part-finance a project to manufacture thermal sensitive paper (fax paper). The company has a technical agreement with Hansol Paper, South Korea, to manufacture fax paper. This project was delayed due to delay in the machinery imported, however the production was commenced during 1996-97 for the project. 

The company is setting up a new unit with a capacity of 20000 TPA for manufacturing of paper at an semi developed land acquired from RIICO at Kotputli, Rajasthan. The company has also decided to produce Inkjet papers.

FINANCIAL RESULTS

During the year under review, the Company has registered marginal growth in sales. The net sales of the Company has been increased to Rs.606.014 Millions in 200506 from Rs. 599.002 Millions in 2004-05. The profit before tax was Rs.6.910 Millions as compared to Rs. 16.665 Millions in the previous year. 

STATES OF NEW PAPER UNIT 

The Company is in the process of further refinement to improve the quality and quantity of paper. With the start of regular quality production, there would be better sales realization and considerable growth of the Company. 

CURRENT OUTLOOK

The paper industry is showing very positive trends. The prices are moving upward and there are signs of buoyancy in international paper markets. The Company will continue to focus on further improvement in all areas of operations. 

Keeping in view of the present market conditions, the Company foresees sustained growth on the basis of its quality of products. The improved quality production of new unit will also add to its growth during the current year. The Directors foresee better performance during the current year. 

MANAGEMENT DISCUSSION AND ANALYSIS 

Industry Structure and Developments: 

The Indian economy has continued its rapid growth during the fiscal year 2005-06 and witnessed one of the fastest growing economies of the world. The GDP growth was more than 8% during the year and economic outlook for 2006-07 is quite positive. The manufacturing sector should continue to propel the overall growth of the economy. 

The paper industry is influenced by literacy and economic growth. The growth in paper industry is more than 6% per annum. The demand of paper has increased globally with printing industry. They will continue to capture new markets and provide better products for their sustained growth. 

Outlook: 

The paper industry is showing very positive trends. The prices are moving upward and there are signs of buoyancy in international paper markets. The Company will continue to focus on further improvement in all areas of operations. 

Keeping in view of the present market conditions, the Company foresee sustained growth on the basis of its quality of products. The new unit production will also add to its growth during the current year. The Directors foresee better performance during the year. 

Financial Performance with respect to Operational Performance: 

The financial performance for 2005-06 depicted that the Company has registered marginal growth in sales. The turnover of the Company has increased from Rs. 599.002 Millions to Rs. 606.014 Millions due to stable market conditions. The profit before tax has declined from Rs. 16.665 Millions to Rs.6.910 Millions. The Overall operational performance has been satisfactory during the year.

The capacity utilisation of the plant was 97% for coated

BUSINESS

Enterprises where Key Management Personnel has significant influence :

M/s. Laxmi Traders

Amer Hotels Limited

Bishwanath Traders & Investments Limited

M/s. Pradeep Agencies

Bishwanath Industries Limited

SKCS Finvest Private Limited

The company has technical collaboration with Hansol Paper Company Limited, South Korea.

The company is in trade terms with :

v Malvern Instrument, UK

v Nagase & Company Limited, Japan

v Mistrail, New Delhi

FIXED ASSETS

• Land
• Leasehold Plot
• Building
• Plant and Machinery
• Furniture and Fixtures
• Office Equipments
• Computers
• Motor Car
• Other Vehicles

AS PER WEBSITE

Subject popularly known as “Silver Cote” was established in the year 1974 by well known Pasari Group by acquisition of Bansal Paper Mills at Bahadurgarh (Haryana). The landmark has been achieved due to the efforts of its visionary Managing Director Mr. N.K.Pasari, ably supported by his dedicated team.

Subject has proven to be one of the most stable economic contributors. Technological advances, an ability to adapt, and quality management have carried the industry through periods of economic challenges and business transitions.

Shree Krishna's success was due in part to the quality products its new equipment put out, but the company was able to find buyers for its products largely because its new owners had considerable marketing skill.

Environmental concerns also made recycled papers increasingly popular, and Shree Krishna introduced a new line of recycled printing and writing papers under the Silver Shine Brand Label.

Mile Stones-

1966 - Established as Bansal Paper Mills.

1974 - Acquisition by Pasari Group.

1979 - Came in full production.

1982 – Introduction of Silver Cote Brand.

1986 - Name changed to Shree Krishna Paper Mills & Industries Limited.

Incorporated oil heating through Thermic fluid heating system in boilers.

Introduction of Senso Cote Brand.

1990 - Introduction of Super Senso quality.

1993 - Signing of Collaboration Agreement with Hansol Paper Company Limited, South Korea.

1997 - Commercial production of Senso Hansol Thermal Sensitive Paper.

2003 - Cast Coated Machine Installed.

2004 - ISO 9001:2000

2005 - BSI Certificate

2006 - Keshwana Unit started for W & P,LWC

The management of subejct is committed to quality, by initiating quality policies that will lead to "Building Partnerships in Excellence" with their customers. These initiatives will enable them to develop a prosperous future side by side with their partners. This commitment is reflected in their company's mission statement and in the following objectives.

1. Provide exceptional quality products and services by striving to exceed their customers' expectations.
2. Maintain a formal quality system meeting all ISO 9002 standards.
3. Foster an atmosphere of continuous process improvement and problem prevention.
4. Empower employees so that they can help improve the systems that affect their work.
5. Provide education and training to all employees to support their health, welfare and safety as a top priority.
6. Communicate their mission and quality objectives to all employees.
7. Develop relationships with their suppliers that emphasize continuous improvement in product quality, service and support.
8. Provide an environment that supports teamwork.
9. Incorporate the most efficient and cost effective production methods.
10. Develop competitive pricing for products and services.

COATING DIVISION

Established as Bansal Paper Mills in the year 1966 and taken over by well known Pasari Group in the year 1974. SKPM is a leading Coated paper & Board Company with operations based at Bahadurgarh near New Delhi.

It is the second largest manufacturer of coated paper varieties and Thermal Sensitive Paper with an installed capacity of 15000 TPA coated paper , 2000 TPA Thermal Sensitive Paper and 1200 TPA of cast coated paper. Their products that spell excellence include "Senso-Hansol" - Thermal Sensitive Paper, 'Silver Cote & Senso Cote' coated paper & board, Inkjet Paper; Fluorescent Paper & board' and "Siver Graphic" Cast Coated Paper, Card & Board for every day needs.

MAJOR TECHNICAL TIE UP

The company entered into exclusive technology transfer licensing agreement with M/S HANSOL PAPER COMPANY LIMITED of South Korea in the August 1993 for manufacturing of Thermal Sensitive Paper and for sale in India, Pakistan, Bangladesh, Sri Lanka, Burma, Maldives, Nepal & Bhutan.

Shree Krishna is exporting Thermal Sensitive Paper to the neighbouring countries, and SAARC countries.

Licencer	Nationality	Item of Technology	Use	Capacity
Hansol Paper Company Limited	South Korea	Thermal Sensitive Paper	For fax Machines/ATM machines/ Medical use.	2000 TPA

The technical assistance agreement envisages transfer of know how and technical information which includes:

All manufacturing knowledge
Process parameters, sequencing, color formulations, specifications and consumption norms of chemicals and other raw materials.
Specifications of equipment's needed.
General description including documents, specifications and standardization sheets.
Procuring source of different chemicals, equipment's and other raw materials.

Shree Krishna has exclusive rights with Hansol for Thermal Sensitive Paper in India and also shall have first right of negotiations if Hansol plans to start any other business in India.

PAPER DIVISION

The company is setting up a new Paper Plant near Jaipur with State of the Art Technology having an installed capacity of 20000 TPA for manufacturing of high quality paper. Civil work, installation/ erection of the plant and machinery is in full swing. The plant is likely to commence production in a year

QUALITY POLICY

It is the policy of SHREE KRISHNA PAPER MILLS & INDUSTRIES LIMITED to consistently manufacture Coated Paper Products of International quality/Standards and market its products meeting customer's requirements at an optimum cost. Customers and Share holders satisfaction is their motto. .

To attain this, they are committed to:-

•  Continuous improvement in their products and services,
•  Minimize waste in all areas,
•  Upgrade all their resources,
•  Respond to changing market requirements.

MISSION / VISION

The fundamental mission of their Company is to strengthen India’s industrial base through increased productivity, effective utilization of manpower and material resources and continued application of modern scientific managerial methods as well as through systematic growth in keeping with national aspirations.

The Company recognizes that while –

- Honesty and
- Integrity are the essential ingredients of a strong and stable enterprise.
- Profitability provides the main spark for economic identity.

VISION

Their aspiration is to become a leading manufacturer of Paper and Board and Specialty Papers. To achieve this, the Company is poised to energize :

- Their people with innovative ideas.
- Management skills for future growth.
- R & D for more effectively in creating new business opportunities.

RESPONSIBILITIES

Guided by its basic philosophy, the Company believes in discharging its responsibility towards:- 

1. Stake Holders

By protecting and safeguarding the investment of Stake Holders.

2. Employees

By providing adequate wages, good working conditions, job security, suitable opportunities for promotion and self-development.

By promoting feelings of trust and loyalty and creating a sense of belongingness and Team-spirit through their closer association with Management at various levels.

3. Customers

By products of proven quality at a fair price.

By bearing their counting confidence in its products ability and its technical competence to keep improving the quality of its products.

4. Community

By respecting the dignity of the individual and acting   according to the ideas of social Gestures.

By encouraging talent and promoting civic sense among members of the community.

CUSTOMER PROFILE

I ) COATED VARIETIES :

The Coated varieties i.e. Chromo (C1S), Art (C2S), Cast Coated (C1S) are used for various purposes like labels, printing, packaging, sales promotion, entertainment etc. The major industries where the coated varieties find applications are:-

· Pharmaceutical Industry

· Food Processing Industry

· Tea Industry

· Soap Wrappers

· Shoe Manufacturers

· Breweries

· Battery Manufacturers

· Oil Industry

· Tourism

· Woollen

· Magazine

· Greeting Cards/Wedding Cards

· Publishers

· Religious Trust

· Electronic/Music/Cassettes

II.  SENSO:HANSOL

THERMAL SENSITIVE PAPER

This quality is being manufactured under technical collaboration with M/s.HANSOL PAPER COMPANYLIMITED, SOUTH KOREA. Thermal Paper, which was initially started for using in facsimile machine, is becoming very popular to be used in may fields of their life now. Amazingly, it has grown for the different applications as under:-.

FACSIMILE ROLLS:

· MEDICAL ROLLS/CHARTS

· POS/CASH REGISTER ROLLS

· ATMs

· TICKETS FOR CINEMA, ROAD TRANSPORT, RAILWAYS, HORSE RACING, ENTERTAINMENT

· BAR CODE/TAGS

· BOARDING PASS

· ON-LINE LOTTERY TICKETS

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.39.91
UK Pound	1	Rs.79.88
Euro	1	Rs.55.88

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	7
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	6
--RESERVES	1~10	6
--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	NO
--AFFILIATION	YES/NO	NO
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		55

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

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

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

RATING EXPLANATIONS

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

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