MIRA INFORM REPORT

Report Date :

28.09.2007

IDENTIFICATION DETAILS

Name :	SUZLON ENERGY LIMITED
Registered Office :	‘Suzlon House’, 5, Shrimali Society, Near Shree Krishna Complex, Navrangpura, Ahmedabad - 380009, Gujarat
Country :	India
Financials (as on) :	31.03.2007
Date of Incorporation :	10.04.1995
Com. Reg. No.:	04-25447
CIN No.: [Company Identification No.]	L40100GJ1995PLC025447
IEC No.:	2495002021
TAN No.: [Tax Deduction & Collection Account No.]	AMMS03088B
Legal Form :	Public Limited Liability Company. The company’s shares are listed on the stock exchanges.
Line of Business :	Manufacturer, Importer and Exporter of Wind Mills, Wind Turbines and Generators.

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 140000000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well-established and progressive company. The company is controlled, financed and managed by Tanti family whose resources are of good value. General financial position is satisfactory. 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 :	‘Suzlon House’, 5, Shrimali Society, Near Shri Krishna Complex, Navrangpura, Ahmedabad-380009, Gujarat, India
Tel. No.:	91-79-26471100
Fax No.:	91-79-26471200 / 26565540
E-Mail :	Khemal@suzlon.com /vkirti@suzlon.com
Website :	http://www.suzlon.com
Area :	361.33 Sq. Mtrs.
Premises :	Owned
Head / Corporate Office :	2^nd and 5^th Floor, Godrej Millennium, 9, Koregaon Park Road, Pune – 411001, Maharashtra, India
Tel. No.:	91-20-26202000 / 24022000 / 24015760 / 24022204 / 40122000
Fax No.:	91-20-24022100 / 40122100
E-Mail :	vkirti@suzlon.com
Area :	20137 sq. mtrs.
Location :	Owned
Factory 1 :	Plot No. 77/13, Opposite G.D.D.I.D.C. Office, Malala, Diu – 362520, Union Territory
Tel. No.:	91-2875-252541 / 5242
Fax No.:	91-2875-252281
Area :	3000 sq.mtrs
Factory 2 :	Survey No. 306/1 and 306/3, Opposite Carrier Aircomp Limited, Near Panchal Industrial Estate, Bhimpore, Nani Daman – 396210, Union Territory.
Area :	6,400 sq.mtrs
Factory 3 :	Plot No. H-24/25, Mahatma Gandhi Udhyog Nagar, Near Water Tank, Dabhel, Nani Daman – 396210, Union Territory
Tel No :	91-260-2253673/2253674
Factory 4 :	Plot No. 57/3, (2 and 3), Dunetha, Daman - 396 210
Factory 5 :	Survey No. 86/3-4, 87/1-3-4, 88/1-2-3, 89/1-2, Kadaiya, Daman - 396 210
Factory 6 :	Survey No. 588, Paddhar (Village),Taluka Bhuj, District Kutch, Gujrat-370105
Factory 7 :	Survey No: 282, Chhadvel (Korde), Sakri, Dhule-424305
Factory 8 :	Survey No. 42/ 2 and 3, 54, 1 to 8, Bhenslore Road, Dunetha, Daman-396 210, Union Territory
Factory 9 :	Block No. 93, National Highway No. 8, Varnama-Vadsala, Dist. Vadodara - 391 240
Factory 10 :	Survey No. 574, 59, Thiruvandarkoil, Thribhuvani Road, Pondicherry-605107
Branches :	Located at : Bangalore Indore New Delhi Chennai Jaipur Surat Coimbatore Kolkata Thiruvananthapuram Hyderabad Mumbai Vadodara

DIRECTORS

Name	Mr. Tulsibhai Ranchodbhai Tanti
Designation	Chairman and Managing Director
Address	C-501, Satellite Towers, Orion, Mundhwa, Pune-411036
Date of Birth	02.02.1958
Qualification	B.Com, Diploma in Mechanical Engineering
Date of Appointment	10.04.1995
Email	ttulsi@suzlon.com
Other Directorship	Group Chairman of Suzlon Group of Companies viz. Suzlon Developers Private Limited, Sarjan Fealities Private Limited, AE Rotor Holding BV, Suzlon Wind Energy Corporation, Suzlon Windfarm Services Private Limited, SNS Textiles Limited, Suzlon Energy GmbH, Suzlon Green Power Limited
Name	Mr. Girishbhai Ranchodbhai Tanti
Designation	Director (International Operation)
Address	C-401, Satellite Towers, Orion, Mundhwa, Pune-411036
Date of Birth	08.02.1970
Qualification	B. E. (Elec.), Management Graduate from Cardiff, U. K.
Experience	10 years
Name	Mr. Balrajsinh A. Parmar
Designation	Director (Projects)
Address	301, Samrajya, Near Manav Mandir, Ahmedabad – 380 052, Gujarat, India
Date of Birth	28.05.1957
Date of Appointment	04.12.1995
Name	Mr. Vinodbhai Ranchodbhai Tanti
Designation	Director (Operation)
Address	15, Amrakadamb, Ramdevnagar, Satellite, Ahmedabad - 380 054, Gujarat, India
Date of Birth	29.06.1952
Date of Appointment	10.04.1995
Name	Mr. Ajay Relan
Designation	Director (Nominee Citycorp International Finance Corporation Inc.)
Address	Citi Bank N. A. Jeevan Vihar, Sansad Marg, New Delhi-110001
Date of Birth/Age :	53 Years
Qualification	M B A from IIM-A; B. A. Honours (Economics) from St. Stephen’s College, Delhi
Name	Mr. Pradip Kumar Khaitan
Designation	Director
Address	B-103, Rai Enclave, 7/1A, Sunny Park, Kolkata-700019
Date of Birth/Age :	65 Years
Qualification	B. Com., L. L. B. Attorney-at-law
Name	Mr. Ashish Dhawan
Designation	Director (Nominee Chrys Capital III, LLC, Mauritius)
Address	55A, Jor Bagh, New Delhi-110001
Date of Birth	37 Years
Qualification	M. B. A. from Harvard University and dual bachelors degree (B.S./B.A.) in applied mathematics and economics
Name	Mr. Vidhyanathan Raghuraman
Designation	Director
Address	20, Kallol Apartments, I P Extension, Pratap Ganj, Delhi-110095
Date of Birth	63 years
Qualification	M. Tech (Chemical Engineering)

KEY EXECUTIVES

Name :	Mr. Hemal A. Kanuga
Designation :	Company Secretary
Name :	Mr. Asit Badve
Designation :	Vice President (Human Resource and Administration)
Name :	Mr. P. C. Mehta
Designation :	General Manager (Purchase)
Name :	Mr. Kirit Vagadia
Designation :	General Manager (Finance)
Name :	Mr. B. N. Shah
Designation :	General Manager (Marketing)
Name :	Mr. VKR Kutty
Designation :	General Manager (Foreign Trade)
Name :	Mr. R. Sridharan
Designation :	General Manager (Works)

BUSINESS DETAILS

Line of Business :

Manufacturer, Importer and Exporter of Wind Mills, Wind Turbines and Generators.

Products :

v Wind Energy, Solar Energy System and Assembling

v Operation and Maintenance Contract

v Electricity Generators

Generic Names of Principal Products / Services of the company is as under :

Product Description	Item Code No.
Wind operated electricity generators	3601

Brand Names :

‘Suzlon’

Exports:

Countries:

USA, Italy, Australia, China, Germany and Middle East

Imports:

Countries:

Germany, Denmark and China

Terms :

Selling :

Cash and Credit

Purchasing :

Cash (30 days), Credit (30 days) and L/C

PRODUCTION STATUS

Product	Units	Actual Production
Wind Turbine Generators Upto 1 MW	Nos.	272
Wind Turbine Generators Above 1MW and Upto 2 MW	Nos.	674
Wind Turbine Generators Above 2 MW	Nos.	260
Blades	Nos.	3726

GENERAL INFORMATION

Suppliers :

· Sudwind GmbH, Germany

· L. M. Glassfibre, India

· Siemens, India

· Winoray, Germany

· Mita Tecknick, Germany

· Mukesh Engineers, India

Customers :

· Bajaj Auto Limited

· Tata Group

· Maharashtra Seamless Limited

· Manickchand Group

· Ajanta Group

· Dhariwala Group

· Ghodavat Group

· Verroc Group

No. of Employees :

11000

Bankers :

• State Bank of India

Specialized Commercial Branch, Neptune Tower Annexe, Gandhigram,

Asram Road, Ahmedabad.

• UTI Bank of India

Ground Floor, Sterling Plaza, 1262/B, J.M. Road, Pune

• IDBI Bank Limited (Cons. Leader)

Dyaneshwar Paduka Chowk, F.C. Road, Pune

• IndusInd Bank Limited

• Bank of Maharashtra

1183-A, Sadashiv Vilas, F.C. Road, Pune

• Standard Chartered Bank

90, M.G. Road, Fort, Mumbai

• Deustsche Bank AG.

DB House, Hazarimal Somani Marg, Fort, Mumbai

• State Bank of Bikaner and Jaipur

Laxmi Road, Pune

• ING Vysya Bank Limited

F.C. Road, Pune

• State Bank of Indore

Mittal Court, D Wing, Ground Floor, Nariman Point, Mumbai

• Punjab National Bank

International Banking Branch, DCM Building, 8th Floor, Barakhambha

Road, New Delhi

• Indian Overseas Bank

7, Wonderland Building, M. G. Road, Pune

• State Bank of Patiala

• Bank of Baroda

2, Moledina Road, Camp, Pune

• Citi Bank

Citibank N. A. Parmar House, 2413, East Street, Camp, Pune

• HDFC Bank Limited

• UTI Bank Limited

• The HSBC Limited

• ICICI Bank Limited

• State Bank of Indore

Facilities :

Particulars	As on 31.03.2007 [Rupees in Millions]
Secured Loans
Term Loans :
From Banks (Various loans secured by a first charge on certain immovable and/or movable fixed assets and second charge on current assets)	161.000
From Others (Secured by a first charge on certain immovable and movable fixed assets, specific security deposits, book-debts and second charge on current assets)	1061.800
Working Capital facilities from banks and financial institutions:
Rupee Loans	4015.800
Foreign currency loans (Secured by hypothecation of inventories, book-debts and other current assets of the Company, both present and future, first and second charge on certain immovable fixed assets)	2479.200
Unsecured Loans
Long-term
From other than banks	203.200
Short – term
From banks	3445.400

Banking Relations :

Satisfactory

Auditors :

Name :

· SNK and Company

Chartered Accountants

E-2-B, The Fifth Avenue, Dhole Patil Road, Near Regency Hotel,

Pune411001

· S.R. Batliboi and Company

Chartered Accountants

The Metropole, F-1, 1st Floor, Bund Garden Road, Pune - 411 001

Memberships :

Confederation of Indian Industry

Associates

· Suzlon Developers Private Limited

· Sarjan Realities Private Limited

· Suzlon Green Power Limited

· SNS Textiles Limited

· Suzlon Wind Farm Services Limited

· Godrej Millennium, 5^th Floor,9, Koreaon park Road, Pune-411001

· Providing Oand M services for ETGs

· Suzlon Structures Private Limited

· ‘Suzlon”5, Shrimali Society, near Shri Krishna Complex, Navarangpura, Ahmedabad-380009

· Manufacturing Tubular Tower

· Suzlon Generators Private Limited

· Godrej Millennium, 5^th Floor,9, Koreaon park Road, Pune-411001

· Manufacturing generators

· Sarjan Infrastructure Finance Limited

IL and FS Financial Centre, 6^th Floor, East Quadrant, Plot no 22, ‘G’ Block, Bandra-Kurla Complex, Bandra (East), Mumbai-400051

Financing infrastructure activities

· Suzlon Infrastructure Limited

Godrej Millennim, 5^th Floor, 9, Koregaon Park Road, Pune-411001

Civil work, erection, installation and commissioning of WTGs

· Sarjan Realities Limited

285/10, Koregaon Park, Behind Singh Motors, Near Hotel Gulmohar, Jupiter, Pune-411001

Acquiring land for setting up wind-farms

Subsidiaries :

· AE-Rotor Holding B.V., Netherlands

· AE-Totor Techniek B.V., Netherlands

· Suzlon Energy B.V., Netherlands

· Suzlon Wind Energy Corporation, U.S.A.

· Suzlon Wind Farm Services Limited, U.S.A.

· Cannon Ball Wind Energy Park – I, LLC, U.S.A.

· Suzlon Energy GmbH, Germany

· Suzlon Energy Australia Pty Limited, Australia

· Suzlon Energy A/S

· Suzlon Structures Private Limited

· Suzlon Towers and Structures Limited (Formerly Suzlon Green Power Limited)

· Suzlon Windkraft GmbH (Formerly Constellation GmbH)

· Suzlon Generators Private Limited

· Windpark Olsdorf WATT GmbH and Co KG

· Suzlon Windpark Management GmbH

· Suzlon Rotor Corporation

· Suzlon Power Infrastructure Private Limited

· Suzlon Energy (Tianjin) Limited

· SE Drive Techniek GmbH

· Suzlon Gujarat Wind Park Limited

· Suzlon Engitech Private Limited (Formerly Sarjan Engitech Private Limited)

· Suzlon Energy Limited, Mauritius

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
430000000	Equity Shares	Rs.10/- each	Rs.4300.000 millions
1500000	Preference shares	Rs.100/- each	Rs.150.000 millions
		Total	Rs.4450.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
287764780	Equity Shares	Rs.10/- each	Rs.2877.600 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

SOURCES OF FUNDS			31.03.2007	31.03.2006	31.03.2005
SHAREHOLDERS FUNDS
1] Share Capital			2877.600	3025.300	2019.23
2] Employee stock options			117.100	103.600	0.000
3] Shares application moneys pending allotment			0.200	0.000	0.000
4] Reserves & Surplus			34138.200	25093.600	7276.49
NETWORTH			37133.100	28222.500	9295.72
LOAN FUNDS
1] Secured Loans			7717.800	2766.100	2854.57
2] Unsecured Loans			3648.600	587.600	370.83
TOTAL BORROWING			11366.400	3353.700	3225.40
Deferred Tax Liabilities			0.000	0.000	0.000
TOTAL			48499.500	31576.200	12521.120
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]			3884.700	2956.800	1602.70
Capital work-in-progress			927.100	762.500	179.28
INVESTMENTS			8052.600	2927.400	1260.08
DEFERREX TAX ASSETS			708.800	580.000	276.06
CURRENT ASSETS, LOANS & ADVANCES
		Inventories	13752.500	11044.900	4945.87
		Sundry Debtors	19707.800	15839.100	6763.35
		Cash & Bank Balances	3513.900	3162.400	881.99
		Other Current Assets	0.000	0.000	0.000
		Loans & Advances	12971.900	6911.300	3759.82
		Total Current Assets	49946.100	36957.700	16351.030
Less :
Current Liabilities & Provisions
	Current Liabilities		11084.700	8583.200	5291.88
	Provisions		3935.100	4025.000	1856.15
Total Current Liabilities			15019.800	12608.200	7148.030
Net Current Assets			34926.300	24349.500	9203.000
MISCELLANEOUS EXPENSES			0.000	0.000	0.000
TOTAL			48499.500	31576.200	12521.120

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
Sales Turnover		53803.700	37884.600	19407.600
Other Income		881.000	692.800	0.000
Total Income		54684.700	38577.400	19407.600
Profit/(Loss) Before Tax		11195.800	9026.600	3924.500
Provision for Taxation		584.400	814.700	309.800
Profit/(Loss) After Tax		10611.400	8211.900	3614.700
Earnings in Foreign Currency :
	Export Earnings	17589.100	2115.300
	Interest on loans	75.700	13.000	279.600
	Other Earnings	110.600	0.000
Total Earnings		17775.400	2128.300	279.600
Imports :
	Raw Materials	18719.400	14637.900
	Stores & Spares	43.400	10.700	7297.280
	Capital Goods	178.400	281.700
Total Imports		18941.200	14930.300	7297.280
Expenditures :
	Cost of Goods Sold	32324.700	22822.100
	Operating and other expenses	8300.000	5094.800
	Employees’ remuneration and benefits	1114.600	629.600	15483.100
	Financial charges	1014.700	545.600
	Depreciation & Amortization	734.900	458.700
Total Expenditure		43488.900	29550.800	15483.100

QUARTERLY RESULTS

PARTICULARS	30.06.2007 (1^st Quarter)
Sales Turnover	8391.900
Other Income	237.100
Total Income	8629.000
Total Expenditure	7264.300
Operating Profit	1364.700
Interest	289.000
Gross Profit	1075.700
Depreciation	177.100
Tax	4.600
Reported PAT	894.000

KEY RATIOS

PARTICULARS	31.03.2007	31.03.2006	31.03.2005
Debt Equity Ratio	0.23	0.18	0.41
Long Term Debt Equity Ratio	0.05	0.09	0.18
Current Ratio	2.13	2.23	1.76
TURNOVER RATIOS
Fixed Assets	11.12	12.25	10.17
Inventory	4.34	4.74	5.51
Debtors	3.03	3.35	3.86
Interest Cover Ratio	12.03	17.54	10.50
Operating Profit Margin (%)	24.06	26.48	24.65
Profit Before Interest and Tax Margin (%)	22.69	25.27	22.62
Cash Profit Margin (%)	21.09	22.89	20.88
Adjusted Net Profit Margin (%)	19.72	21.68	18.85
Return on Capital Employed (%)	30.54	43.41	46.36
Return on Net Worth (%)	32.56	45.26	60.10

STOCK PRICES

Face Value	Rs.100.00
High	Rs.1268.85
Low	Rs.1187.10

LOCAL AGENCY FURTHER INFORMATION

NOTE:

The Company’s registered office situated at Sahajanand Building, Navrangpura, and Ahmedabad – 380009 has been shifted to the above address.

HISTORY

The company was incorporated on 10^th April 1995 at Ahmedabad in Gujarat having Company Registration Number 25447.

Subject belongs to Suzlon Group of Companies promoted by Mr. Tulsibhai R. Tanti, a qualified and technocrat entrepreneur along with his family members.

The company has developed in house technology through their own Research and Development centers in Germany and Nederland and has developed largest Wind Farm with 201MW capacity at Satara, Maharashtra, which is the largest Wind farm of Single make in Asia.

Subject integrates consultancy, design, manufacturing, operation and maintenance services to provide customers with total wind power solutions 

Subject is one of the fastest growing Wind Energy companies in the world. The key to company’s meteoric growth has been company’s vision of creating world-class products by adopting the best of everything from around the globe. Subject has a subsidiary in Germany for technology development, an R and D facility in the Netherlands for rotor blade molding and tooling, and Wind Turbine and rotor blade manufacturing facilities in India. All this is backed up by stringent international quality control and assurance systems like ISO 9001:2000 and Type certification. 

The Company was incorporated in 1995 by Tulsi Tanti. Tulsi Tanti was primarily in the textile business and was introduced to wind energy through a wind power project that he had commissioned for his textile factory. The first subscribers to the Memorandum were the family members and friends of Tulsi Tanti. 

The Company entered into a technical collaboration agreement in 1995 with a German company, Sudwind GmbH Windkrafttanlagen to source the latest technology for the production of WTGs in India. Sudwind GmbH Windkrafttanlagen was subsequently taken over by Sudwind Energiesysteme GmbH ('Sudwind'). The parties entered into a fresh agreement dated September 30, 1996, under which Sudwind proposed to share technical know-how relating to 0.27 MW, 0.30 MW, 0.35 MW, 0.60 MW and 0.75 MW WTGs in consideration for royalty to be paid on the basis of each WTG sold over the course of five years from the date of this agreement. The Company obtained the official non-exclusive, non-transferable license for the manufacturing, marketing, dealing and servicing of APX-60 type blades from the trustee of Aerpac B.V. upon its liquidation, for consideration of Euro 200,000 vide an agreement that was entered into between the trustee of Aerpac B.V. and the Company dated 04.06.2001. This license is valid for an indefinite period. The Company entered into an agreement dated April 10, 2001 with Enron Wind Rotor Production B.V. for the acquisition of the moulds and the production line and technical support and assistance for the production of the rotor blade type APX 60-P in India for total consideration of Euro 500,000. Enron has granted these rights for the manufacturing, marketing and dealing with the products for an indefinite period. 

The Company introduced the concept of total solutions wherein, in addition to the supplies of equipments, the client is offered project execution work comprising land acquisition, site development, erection and commissioning, foundation and other civil work and O and M services. These services are offered in conjunction with the Associate Companies. SWSL, a subsidiary of the Company, was incorporated in 1998 with the objective of providing O and M for wind power projects set up by the Company. The Company has also set up technological development centers in Germany and The Netherlands through wholly-owned subsidiaries. SEG, incorporated in 2001 and earlier known as AX 215 Verwaltungsgesellschaft mbH became a wholly-owned subsidiary of the Company in 2002. AERT, a wholly owned subsidiary of AERH, which in turn is a wholly owned subsidiary of the Company, was incorporated in 2001 to engage in the development of technology for rotor blades, a key component of WTGs. Further, Suzlon Energy A/S, a wholly-owned subsidiary of the Company was incorporated in August, 2004 to supervise the international marketing activities of the Company. It is proposed that the entire non-India marketing activities of the Company shall be coordinated through Suzlon Energy A/S. SWECO, now a wholly-owned subsidiary of the Suzlon Energy A/S, was incorporated in 2001 to market, the WTGs manufactured by the Company in U.S.A. Further, Suzlon Energy A/S has another wholly-owned subsidiary, Suzlon Energy Australia Pty Limited, which was incorporated in 2004 to access the wind energy market in Australia. Suzlon Energy B.V. earlier known as AE-Rotor B.V., The Netherlands, a wholly-owned subsidiary of AERH, which is a wholly-owned subsidiary of the Company, was incorporated in 2001 to market the rotor blades manufactured by the Company. Cannon Ball Wind Energy Park-I, LLC ('Cannon Ball') was incorporated as a limited liability company in July, 2002 for the purpose of setting up a wind power project in North Dakota, USA. Cannon Ball is a wholly-owned subsidiary of SWECO which is a subsidiary of Suzlon Energy A/S. Further, a representative office of the Company was also set up in China in 2003 to explore the Chinese market.

Subject has taken a step further for establishing its presence in China by commencing the establishment of a wind turbine generator manufacturing facility in China through its wholly owned subsidiary Suzlon Energy (Tianjin Limited, The said manufacturing facility which is scheduled to commence its commercial operations by about Second quarter of financial year 2006-2007 would cater to the energy needs of China. 

The companies product range includes 0.35 MW, 0.60 MW, 0.95 MW, 1.00 MW, 1.25 MW and 2.00 MW WTGs 

Subject also has the distinction of introducing the concept of large wind parks in Asia and has gone on to build some of the largest wind parks in Asia including the world's largest wind park of its kind. 

Further, Subject's status as a force to reckon with in the wind energy industry came with the World Wind Energy Association's award for the year 2003, recognizing its contribution in disseminating wind energy worldwide.

BUSINESS

The status of wind energy industry, across the major markets of the world where Suzlon operates, is as follows:

India

• According to the Central Electricity Authority, India, in FY 2006-07, demand for electricity in India exceeded supply by an estimated 9.6 % (8.4 % in FY 2005-06) in terms of total requirements and 13.8 % (12.3% in FY 2005-06) in terms of peak demand requirements. Further, the Indian Government in its mission 'Power for all by 2012', estimated that Indian installed generation capacity should be 200,000MW by the end of its Eleventh Five Year Plan in 2012 compared to 132,329MWas of March 31, 2007.

• The wind energy market in India has been growing steadily over the last 3-4 years. According to the World Market Update 2006, in CY 2006 India was the third largest country in the world in terms of annual capacity addition, with 1,840 MW in new capacity. India surpassed Spain in terms of annual capacity addition, and Denmark in terms of cumulative capacity.

• The cumulative installed MW capacity for wind power in India is expected to grow from 6,228 MW in CY 2006 to 18,028 MW in CY 2011, representing a CAGR of 24%. The Indian Government, through the Ministry of New and Renewable Energy ('MNRE'), continues to encourage state governments to implement national policy guidelines set for wind power projects. Several new initiatives are being undertaken by the MNRE to reassess India's gross wind power potential.

China

• China added 1334MWinstallations in CY 2006, a growth of 106% compared to last year making it the 5 largest wind market in CY 2006 and more than doubling its cumulative installed capacity to around 2600 MW. The rapid built up of wind capacity still represents just 1.3% of the massive 105GWof new generating capacity the country has brought online last year.

• China renewable energy law which came into effect on January 1, 2006 aims for 16% of the country's energy needs to come from renewable energy by CY 2020.

• Targets for wind energy are set at 5,000MWby CY 2010 and 30,000MWby CY 2020. The estimates looks conservative judging by the current growth. All indications are that China may displace Denmark from fifth place in the global wind power market shortly.

The Americas

• The Americas' market performed very well during the year with around 3,515 MW wind installations. In terms of cumulative installations it was 13,577 MW at the end of CY 2006 (Source: BTM Consult ApS, World Market Update 2006).

• In the USA, the growth in the market in CY 2006 as in previous active years was fuelled due to Production Tax Credit System (PTC) and state-based renewable policies. More and more states in the United States have introduced the 'Renewable Portfolio Standard' which mandates that renewable energy sources contribute a specified minimum percentage of total electricity supply.

• Total installations in Canada reached 1,166 MW with 584 MW being added in CY 2006. In Latin America, Brazil continued to lead the way with 208MW installations.

Europe

• Europe has maintained its leadership in wind industry in terms of new installations in CY 2006, and is by far the largest market in cumulative terms. Europe still accounts for nearly two-thirds of global wind energy generation capacity and reached a cumulative 48,627MW, up 7,682MWduring the year.

• Germany with 2233 MW and Spain with 1587 MW installations were key performers in CY 2006. Apart from these the growth markets, notable were France (100% growth), the UK ( 46%), Portugal (68%), Poland (252%) and Greece (30%) in Western Europe, with Turkey (168%) leading up the new markets in the East.

• Recent European Union (EU) Directives stipulate the need to help double the share of non-fossil renewable energy sources, such as wind, from 6% to 12% of gross energy consumption in Europe by CY 2010. The incremental installations in Europe are expected to total 46,650 MW by CY 2010, nearly doubling current cumulative capacity.

• Europe also offers a most promising offshore wind market, with 877MWalready installed. UK and Sweden are the most promising offshore market, with Germany, Denmark, the Netherlands and Belgium also having some projects in pipeline. New offshore installations are expected to increase significantly over the coming years with over 6,700MWof new offshore installations expected by CY 2011.

Australia

• With the additional installation of about 146 MW in CY 2006 the cumulative installations in Australia reached 966MW.

• State governments in Australia announced independent renewable energy targets. The process was started by Victoria state government which announced it sown mandatory renewable energy target for10%of its power to come from renewable energy by CY 2016 up from 4% previously. Other states followed with New South Wales confirming its mandatory target for10%byCY 2010 and15%byCY 2020.

Potential of the wind energy industry

• The International Energy Agency (IEA) in its World Energy Outlook 2006, estimates that the world electricity demand is projected to double by CY 2030. Globally, the power sector is required to add an estimated 5,087 GWof capacity to meet the projected increase in electricity demand and to replace ageing infrastructure.

• The IEA estimates that this would require cumulative investment of approximately US $20 trillion between CY 2005andCY 2030andmorethanhalfofthisenergyinvestmentwillberequiredbydevelopingcountriesalone.

• Wind power installations are heavily concentrated in Europe, the United States, India and China, which accounted for about 93%of cumulative installed capacity, as of CY 2006.

• The cumulative installed capacity for wind power is expected to grow from 74,306MWin CY 2006 to 203,151 MWby CY 2011, representing an average growth rate for cumulative installation of 22.3%p.a. (Source: BTM Consult ApS: World Market Update 2006)

• The penetration of wind power in worldwide generation of electricity is expected to increase from 0.82 % in CY 2006 to 4.04%inCY 2016. (Source: BTMConsult ApS: World Market Update 2006)

• Share of the Americas (including the United States) is expected to increase from 18%in CY 2006 to 23%by CY 2011. OECD Pacific countries such as Australia, New Zealand, Japan and South Korea are estimated to increase their share of the cumulative installed capacity from 3.5%inCY 2006 to 4.0%by CY 2011. South Asia and East Asia are expected to have significant growth rates in the next five years, particularly due to countries like India and China. Its share of the cumulative installations is expected to increase from 12%in CY 2006 to 18%by CY 2011. Europe's share in cumulative installations is expected to be around 53%byCY 2011.

Key drivers to the growth of the wind energy industry

Following are some of the key drivers stimulating the growth of the wind energy industry:

• Increasing cost competitiveness: A continuous focus on improving the cost efficiency of WTGs has resulted in wind power becoming increasingly cost competitive compared to traditional sources of energy. Some of the factors that contribute to reduced costs are increasing economies of scale from large project sandhigher capacity wind turbine generators(WTGs),as well as improved ability to obtain financing for wind power projects.

• Environmental awareness and governmental initiatives: Growing concern towards global warming has drawn attention of several governments across the globe towards renewable energy sources. As such, many countries, such as India, the United Kingdom, the United States and Germany, have provided fiscal incentives and schemes to encourage the growth of renewable energy sources. These incentives and schemes range from preferential tariffs or tax credits for renewable energy projects, and framing taxing schemes for those who contribute to emission of carbon dioxide. Approximately 141 countries have shown their support by adopting Kyoto Protocol, which became effective in February 2005. The participating countries have agreed to a long-term reduction of their carbon dioxide emissions by an average of 5.2%per annum compared to the level of emissions for CY 1990, by CY 2012.

• Repowering: Repowering involves the replacement of old WTGs with new and more cost efficient WTGs. It is expected to become one of the growth drivers in relation to the future market for wind power, particularly for countries in Europe that have a large number of ageing WTGs installations with relatively low capacity and outmoded technology.

• Offshore market: The offshore WTGs market presents a new opportunity for wind power, especially in Europe. Several offshore projects have commenced operations, with Denmark accounting for a majority of them. The cumulative offshore installed capacity stood at 877 MW at the end of CY 2006. With the introduction of larger WTGs targeted at the offshore market, significant developments are expected in the offshore market in the future. New offshore installations are expected to increase significantly over the coming years with cumulative offshore installations expected to reach 7,607MWby CY 2011.

• Renewable energy policies: Based on the various stages of their development, different regions/countries have used different policy instruments to promote renewable energy sources in general, and wind energy in particular, specific emphasis has been placed on the following:

(a) Feed-in tariffs or fixed tariff regimes: Major countries following feed-in tariff / fixed tariff regimes include Germany and Spain.

(b) Renewable Portfolio Standards (RPS)/Renewable Energy Credits (RECs): Over 30 countries have mandated certain percentages including the European Union, China and Australia. More than 11 states in India have also enacted RPS regulations.

(c) Tendering Schemes: Major countries following tendering schemes include Ireland, France and China.

(d) Other Incentive Instruments: Some of the other complementary initiatives are fiscal measures such as investment tax credit, production tax credit, low interest loans, loan guarantees and investment subsidies. Major countries following tax credit schemes include US, Canada (Production Tax Credit) and India.

Suzlon competitive strengths

Suzlon has in the past demonstrated its ability to capitalize on its strengths and grow in a highly competitive market dominated by established players. Some of the Company's key strengths are as follows:

• Strong management team: To support Suzlon's ambitious growth plans, the Company has undertaken several steps to strengthen its Management, bringing on board senior leaders with expertise in various business domains and global management experience. The Company has also located its Global Management Center (GMC) in Amsterdam, to leverage on its central location with respect to global markets and Suzlon's global operations. The GMC is responsible for direction and driving the group's aggressive growth. To meet its phenomenal growth plans Suzlon currently employs around 10,000 employees, spread across geographies and it promotes a work environment that encourages innovation and enhances work satisfaction among its employees.

• Global production platform and access to an integrated manufacturing base:With production facilities in India, China, the United States and Belgium (Hansen Transmissions), Suzlon has created a global production platform for supplying to the key growth markets. Growing in a supply restricted environment, the Company has established a vertically integrated supply chain with the capability to manufacture all key components such as rotor blades, gear boxes, generators, control panels and towers in-house. The Company is also furthering its backward integration strategy by establishing facilities for forging and foundry components used in WTGs and its components.

• Delivering enhanced value chain in wind energy markets: Suzlon's business model has evolved to an “integrated solutions” package for wind energy projects. Suzlon's key activities include: (a) designing, developing and manufacturing WTGs; (b) wind resource mapping; (c) identifying suitable sites for wind farms; (d) co-ordinating with its associate companies in acquisition and development of these sites (e) installation of WTGs; and (f) providing after-sales OandM services. This business model allows Suzlon's customers to benefit from the cost-efficiencies and economies of scale wind farms can offer. Suzlon's expertise in OandM has also added value in enhancing the performance of WTGs under operational conditions. Suzlon gathers real-time data relating to the WTGs enabling on-line turbine performance management even for remote locations. Suzlon's RandD teams leverage the operational data gathered to constantly improve upon the current WTGs models.

• In-house technology and design capabilities : Suzlon has driven a sophisticated RandD programme to develop a comprehensive product portfolio, ranging from sub-MW to multi-MW turbines. The Company as followed a 'best of all worlds' strategy to technology development, harnessing Europe's expertise in turbine and component research, aerodynamics development, and leveraging expertise in India for process engineering. Suzlon currently drives its RandD programme out of centers in Belgium, India, the Netherland and Germany harnessing processes and technologies to develop wind power solutions customized to meet the needs of the world'swind markets.

• Market leader in India and significant presence in several other high growth markets: For the last nine fiscal years, Suzlon has been the leading WTGs manufacturer in India with a market share of 52.3%of the total capacity installed in India in CY 2006, in spite of India being the third largest wind power market in terms of annual installed capacity during the same period (Source: BTM Consult ApS: World Market Update 2006). Suzlon has over the last four years established a significant presence in key wind markets such as China, Europe and the United States; with the USA forming the largest market for the Company outside India.

DIRECTOR REPORTS

Operating Results And Business: 

 On a standalone basis, your Company achieved a turnover of Rs 53803.700 millions as compared to Rs 37884.600 millions in the previous year registering a growth of 42.02%. The net profit after tax stood at Rs 10611.400 millions compared to Rs 8211.900 millions in the previous year registering a growth of 29.22%.

 On consolidated basis, the turnover is Rs 79857.300 (including Rs.18560.700 millions on account of gear box business) as compared to Rs 38410.300 millions in the previous year registering a growth of 107.91%. The net profit after tax and minority interest is Rs 8640.300 millions compared to Rs 7595.000 millions in the previous year.

The past year has been an eventful one for the Company and all its stakeholders. The Company has grown from strength to strength, and taken challenges on the global stage in its strategic drive to reach all key wind markets of the world, and demonstrated its delivery across global markets.

In the current financial year export accounted for 38.62% of total MW sold by the Company, thereby demonstrating the global acceptance of the Company's products. 

During the year Suzlon expanded its presence to 14 countries across five continents, reaching Australia, Belgium, Brazil, China, Denmark, Germany, Greece, Holland, India, Italy, New Zealand, Portugal, South Korea and the United States. The Company maintained its ranking as the fifth leading wind turbine manufacturer worldwide, while increasing its previous market share by over 28%, to capture 7.7% of the global market in calendar year 2006.

The Company also maintained market leadership in India for the ninth consecutive year with around 50% of market share. (Source: BTM Consult ApS:World Market Update 2006).

CHANGE IN CAPITAL STRUCTURE: 

 Paid-up share capital: 

 During the year under review, the Company allotted 233,400 equity shares of Rs 10 each pursuant to exercise of options granted under the employee stock option plan-2005. 

 Restructuring of authorised share capital: 

 During the year under review, the authorised share capital of the Company was restructured by reclassifying the existing 1,15,00,000 preference shares of Rs 100/- each in the authorised share capital of the Company to 15,00,000 preference shares of Rs 100/- each and 10,00,00,000 equity shares of Rs 10/- each. The authorised share capital of the Company after the aforesaid restructuring comprises of 43,00,00,000 equity shares of Rs 10/- each and 15,00,000 preference shares of Rs 100/- each. 

SUBSIDIARY COMPANIES:

 The existing domestic and international subsidiaries continued to perform satisfactorily during the year under review. Apart from its existing subsidiaries the Company also promoted / acquired a few more subsidiaries for furthering its business objectives. 

Domestic subsidiaries incorporated during the year: 

 SE Forge Limited, a wholly-owned subsidiary of the Company, was incorporated on June 26, 2006 in the state of Gujarat. It is engaged in the business of forging and foundry. 

 Suzlon Wind International Limited, a wholly-owned subsidiary of the Company, was incorporated on December 12, 2006 in the state of Karnataka.

It has been incorporated to engage in the business of manufacturing wind turbine generators (WTGs). 

 Suzlon Rotor International Limited, a wholly owned subsidiary of the Company, was incorporated on December 12, 2006 in the state of Karnataka.

It has been incorporated to engage in the business of manufacturing rotor blades. 

 Suzlon Towers International Limited, a wholly-owned subsidiary of the Company, was incorporated on December 12, 2006 in the state of Karnataka.

It has been incorporated to engage in the business of manufacturing tubular towers. 

 Overseas subsidiaries incorporated/acquired during the year: 

 Suzlon Wind Energy Limited was incorporated in the United Kingdom, on April 7, 2006 as a wholly-owned subsidiary of Suzlon Energy Limited, Mauritius, and further holds investment in certain subsidiaries.

  On May 9, 2006, AE - Rotor Holding B.V., (a wholly-owned subsidiary) acquired Eve Holding N.V., Belgium, holding company of Hansen Transmissions International N.V. (Hansen). Hansen is engaged in the business of design, development, manufacturing and supply of industrial and wind gear boxes.

Hansen Transmissions Limited, Hansen Transmissions South Africa Pty Ltd, Hansen Transmissions Pty Ltd, Hansen Transmissions Inc., Hansen Transmissioes Mechanicas Ltda, Hansen Transmissions Tianjin Industrial Gearbox Co. Ltd, are subsidiaries of Hansen Transmissions. 

 Suzlon Wind Energy A/S, Denmark, is a wholly-owned subsidiary of Suzlon Energy A/S, Denmark. It was incorporated in June 2006, in order to carry out marketing activities in Europe and Latin America. It also acts as a holding company to the companies in the European and Latin American regions, engaged in marketing and selling WTGs in their respective countries. Suzlon Energy Italy Srl incorporated in November 2006 in Italy, Suzlon Energy Portugal Energia Eolica Unipressol Lda incorporated in September 2006 in Portugal, Suzlon Energia Eolica do Brasil Ltda incorporated in September 2006 in Brazil, Suzlon Energy Korea Co., Ltd., incorporated in September 2006 in Korea, in order to undertake marketing, sales and project related activities in respective countries, are wholly owned subsidiaries of the Company.

 During the year SE Drive Technik GmbH, a wholly-owned subsidiary, has acquired its 75% stake in Suzlon Windenergie GmbH, which was incorporated as an investment company.

OUTLOOK AND STRATEGIC FOCUS

Suzlon is now at an inflection point in its changing business landscape. The international component of Suzlon's business has increased significantly over the past few years, and is poised to exceed the domestic business in FY 2007-08. To manage the changing business scenario, Suzlon has embarked on a transformation programme, taking several steps to make it more competitive and create better value for all its stakeholders.

• Global talent management: Being a global Company Suzlon needs to hire the best in class, internalize new cultures and implement global management practices. Hence one of the strategic initiatives undertaken by Suzlon focuses on global talent management to cater to the requirements of an increasingly diverse milieu of multi-cultural professionals. The global headquarters have been set up in Amsterdam, the Netherland and Suzlon has rolled out global organization structure with key people in charge of specific functions and markets. Suzlon is taking on the challenge to scale up operations and replicate the success achieved in India across the world, and sustaining the business model in a broader global marketplace.

• Organic growth through expansion in high growthmarkets worldwide: In order to increase its share of the world market for wind energy, Suzlon plans to continue to grow its overseas operations. Suzlon considers its key markets to be China, India, North America, and key growth markets in Europe, including France, Portugal, Italy, Spain and the United Kingdom, which have the potential for further development and investment in renewable energy, and wind power in particular.

• Inorganic growth through strategic acquisitions and alliances: Suzlon will evaluate on a case-by-case basis potential acquisition targets and alliance partners that offer an opportunity to grow its business and/or expand its capabilities on global front. Suzlon intends only to pursue those transactions that complement its key strengths, are synergistic and, in its assessment, have manageable integration risks. In line with this strategy, Suzlon has acquired Hansen Transmissions of Belgium, and has made a bid to acquire REpower Systems AG of Germany.

• Customer-centric focus: Suzlon believes that each customer is unique. Increase in the variety of customers and new business models have prompted Suzlon to focus on each customer class individually to serve their unique needs in the best possible manner. Thus another such initiative focuses solely on Customer Centricity so that customer facing processes are managed to create long-term partnerships with key customers and build sustainable relationships.

• Transforming, manufacturing and supply chain: Suzlon is in the process of constructing additional manufacturing facilities in India for WTGs and key components. Suzlon has adopted a strategy to support high growth markets with dedicated manufacturing capacity – as in the case of the USA and China. Suzlon also intends to expand its manufacturing capacity for gearboxes in Belgium to meet growing demand in a supply restricted environment.

With the increasing scale of operations, new initiatives are underway to get the best out of the manufacturing and the logistics processes. In order to unlock the value of its three key components of the wind turbine, Suzlon is moving to segregate its manufacturing into three verticals – Nacelle, Composites and Tower – to make them more accountable, profitable and scalable. Suzlon is also introducing lean manufacturing processes to build world class supply chain and manufacturing capabilities and generate synergies through effective co-ordination across businesses.

• Product and technology leadership: Suzlon intends to leverage the WTGs design and development capabilities it has developed through its RandD programme to enhance its existing WTGs models and develop new models, particularly in the MWand multi-MW categories. Suzlon aims to take advantage of its vertically integrated organization to combine WTGs research with component level development to design and develop advanced WTGs offering greater cost efficiency and reliability. To give shape to this vision, Suzlon plans to set up technology centers, innovation centers and engineering centers at various locations across the world.

• Internal collaboration: Suzlon's cross-border expansion of business requires all functions of the organization to be at the peak of their performance curve and continuous innovation in its processes to deliver the best to its customers. Suzlon has launched an initiative around internal collaboration to smoothly integrate new members in Suzlon family and to ensure seamless workflows across business units, companies, time zones and geographies to deliver value to all stakeholders.

Further, in order to ensure that the vision and strategies developed for the sustainability of its business is translated into reality, Suzlon has chosen the 'Balance Scorecard' approach. This approach enables Suzlon to keep track of four main perspectives – learning and growth, business processes, customer and markets and financial, and to take timely action to ensure that execution of its strategy is not compromised.

Suzlon believes that the long-term vision of an organization can be converted into reality only if all the stakeholders are aligned and committed to 'Sustain' excellence in business leadership, 'Innovate' to improve the products and processes and 'Deliver' on promise. It is Suzlon's belief that these execution focused programme will create long-term sustainable leadership for Suzlon on the global marketplace by building the right processes, systems, practices, competencies and mindsets.

Fixed Assets

· Freehold Land

· Leasehold Land

· Buildings

· Plant and Machinery

· Computers

· Office Equipments

· Furniture and Fixtures

· Vehicles

TRADE REFERENCE:

· Flender, Germany

· ASVG, Germany

· L. M. Glasfibre

· Siemens

NEWS :

2005

Subject opens its International operations head quarters at Aarhus Denmark

Subject, Asia’s largest integrated wind power company opened office of their wholly owned subsidiary, Suzlon Energy A/S in the Aarhus Denmark, which is known as a hub for wind energy.

A small but graceful function for the formal opening was organized at the office itself. The function was attended by about hundred persons from the wind industry. Amongst the invitees were customers, bankers, vendors, stakeholders and well wishers of Suzlon. Indian Ambassador in Denmark Mr. Harsh Bhasin graced the function by his presence.

In his opening speech, CEO of Suzlon Energy A/S, Mr. Per Pedersen, welcomed the guests and formally announced opening of the office. He also highlighted various activities that would be carried out from this office, namely management of Subject’s global business initiatives. Mr. Tulsi Tanti Chairman of Suzlon in his brief address explained why Subject chose Denmark for its global head quarter over other destinations and reiterated Subject’s commitment to wind energy. India’s ambassador to Denmark Mr. Bhasin hailed Subject’s achievements in wind industry over past few years and mentioned that in the times of outsourcing of jobs from Europe to India, Subject has created a history by reversing the trend by generating employment opportunity in Denmark. Mr. Dipak Rostogi, head of CVC international Citi group, in his colourful speech explained why Citi group chose to participate in Subject as equity investor.

Subject reception generated lot of excitement amongst local media, local press and TV acknowledged Subject’s entry in Denmark and carried short stories on the subject.

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.39.74
UK Pound	1	Rs.80.34
Euro	1	Rs.56.30

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	8
PAID-UP CAPITAL	1~10	8
OPERATING SCALE	1~10	8
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	9
--PROFITABILIRY	1~10	7
--LIQUIDITY	1~10	8
--LEVERAGE	1~10	8
--RESERVES	1~10	8
--CREDIT LINES	1~10	8
--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		72

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