MIRA INFORM REPORT

Report Date :

12.06.2008

IDENTIFICATION DETAILS

Name :	INDO BRINE INDUSTRIES LIMITED
Registered Office :	Survey No. 282, Salt City, N. H. 8A, Near Village Chopadva, Bhachau, Kachchh – 370201, Gujarat
Country :	India
Financials (as on) :	31.03.2007
Date of Incorporation :	20.11.1996
Com. Reg. No.:	04-31160
CIN No.: [Company Identification No.]	U51100GJ1996PLC031160
TAN No.: [Tax Deduction & Collection Account No.]	RKTI00186E
PAN No.: [Permanent Account No.]	AAACI4654H
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturers and Suppliers of Refined Free Flow Iodized Salt

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 180000
Status :	Satisfactory
Payment Behaviour :	Correct
Litigation :	Clear
Comments :	Subject is a well established company and has improved its performance. The company is expected to wire but remaining accumulated losses, soon. It’s trade record are fair. Payments are usually correct and as per commitments. The company can be considered normal for business dealings at normal trade terms and conditions.

INFORMATION PARTED BY

Name :	Mr. Ramesh Singhal
Designation :	Financial Controller
Date :	07.06.2008

LOCATIONS

Registered Office : / Factory Office	Survey No. 282, Salt City, N. H. 8A, Near Village Chopadva, Bhachau, Kachchh – 370201, Gujarat, India
Tel. No.:	91-2836-231295
Mobile No.:	91 – 9426730384 / 9426217225 / 9426730414
Fax No.:	91-2836-231586
E-Mail :	indobrine@agrawalgroup.in
Website :	http://www.kohinoorsalt.com
Corporate Office:	"Agrawal's House", Plot No-356, Ward 12-B, Gokul Park, Tagore Road, Gandhidham (Kutch) – 270301, Gujarat, India
Tel. No.:	91 – 2836 – 231295 / 231711 / 2837-282515 /
Fax No.:	91 – 2836 – 231586
Location :	Owned

DIRECTORS

Name :	Mr. Gupta Mahesh N
Designation :	Director
Address :	Plot No. 186, Sector 4, Gandhidham – 370201
Date of Appointment :	31.10.1996
Date of Ceasing :	25.08.2005
Name :	Mr. Agrawal Satyanarayan A
Designation :	Director
Address :	Plot No. 121, Sector 4, Gandhidham – 370201
Date of Birth/Age :	13.11.1955
Date of Appointment :	31.10.1996
Date of Ceasing :	22.07.2005
Name :	Mr. Jalavadia Jayantilal G
Designation :	Director
Address :	“Kalrav” Narmada Park, Amin Marg, Rajkot
Date of Appointment :	19.08.2002
Name :	Mr. Pranav N Agrawal
Designation :	Director
Address :	Plot No. 96, Sector 4, gandhidham – 370201
Date of Birth/Age :	01.08.1984
Date of Appointment :	11.07.2005
Name :	Mr. Sahil Subhash Garg
Designation :	Director
Address :	C/O Agarwal Roadlines Private Limited, 1203, GIDC Ranoli, Baroda
Date of Birth/Age :	12.08.1980
Date of Appointment :	22.07.2005
Name :	Mr. Jatin S Agarwal
Designation :	Director
Address :	Plot No. 121, Sector 4, Gandhidham – 370201
Date of Birth/Age :	11.05.1980
Date of Appointment :	22.07.2005
Name :	Mr. Dinesh M Agarwal
Designation :	Director
Address :	Plot No 115, Sector 4, Gandhidham – 370201
Date of Birth/Age :	03.09.1966
Date of Appointment :	22.07.2005
Name :	Ms. Veenaben S Agarwal
Designation :	Director
Address :	Plot No. 119, Sector 4, Gandhidham 370201
Date of Birth/Age :	01.10.1966
Date of Appointment :	22.07.2005

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

Names of Shareholders	No. of Shares
Satyanarayan Atmaram Agarwal	675200
Narsingh Atmaram Agarwal	195000
Rajesh Atmaram Agarwal	584000
Mahesh Nauratmal Gupta	561000
Vax Housing Finance Corporation Limited	150000
Sonal Cosmetics Exports Limited	400000
Kor India Engineering Company Limited	50000
Sheetal Securities Finance Limited	100000
Dinesh Motilal Agarwal	1000
Pranav Narsinghbhai Agrawal	25000
Anitaben Rajesh Agrawal	75000
Kavitaben Dinesh Agrawal	22800
Rajesh Atmaram Agarwal [Jointly With Veenaben S Agrawal]	61000

Equity share breakup (percentage of total equity)

As on 30.09.2007
Directors or relatives of directors	100.00
Total	100.00

BUSINESS DETAILS

Line of Business :	Manufacturers and Suppliers of Refined Free Flow Iodized Salt
Products :	Refined Free Flow Iodized Salt Various Grades of Industrial Salt
Brand Names :	“KOHINOOR”
Exports :
Products :	Salt
Countries :	· Srilanka · Nepal · Colombo
Terms :
Selling :	Credit (22 to 30 days)
Purchasing :	Credit (30 days)

GENERAL INFORMATION

Suppliers :	L. Ratola Surveyors Ashok Leyland Finance Limited BGH Exim Private Limited Gujarat Multi Gas Base Chemicals Private Limited Jignesh Industrial Corporation Kishan Tractor and Hydraulic Spares Maheshwari Enterprises Nirav Laboratories Private Limited Hiranandani and Company Guru Ashich Computer Mart Industrial Security and Investigation Jayesh Advertisers
Customers :	· Nirma Limited · Gujarat Heavy Chemicals Limited · Hindustan Lever Limited (Marketing under the Brand name “Annapurna & Captain Cook”) · Saboo Sodium Chloride Limited · Meghmani Organics · Aquagel Chemicals (Private) Limited · Bajaj Salt Private Limited · C. G. Traders · Chitra Traders · T. C. International · Sanjay Salt Suppliers · Wellbrines Chemicals Limited · Sallech Industries
No. of Employees :	100
Bankers :	· Mehsana Urban Co-operative Bank · Oriental Bank of Commerce · HDFC Bank · The Gandhidham Mercantile Co-operative Bank Limited · ICICI Bank Limited · State Bank of India · State Bank of Patiala Plot No. 20, Vrindavan Complex, Sector9, Gandhidham – 370 201, Gujarat, India
Facilities :	C/C Rs. 30.000 millions from S.B.P.

Banking Relations :	Satisfactory
Auditors :
Name :	Hiranandani and Company Chartered Accountants Banke Bihari, Plot No 16, Ward 12BC, Opposite IFFCO Main Gate, Gandhidham – 370201, Gujarat, India
Sister Concerns :	Agarwal Road Lines Private Limited Tagore Road Activities : Transport

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
4000000	Equity Shares	Rs. 10/- each	Rs. 40.000 Millions
	Total		Rs. 40.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
3950000	Equity Shares	Rs. 10/- each	Rs. 39.500 Millions
	Total		Rs. 39.500 Millions

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		39.500	39.500	27.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		0.000	0.000	0.000
4] (Accumulated Losses)		(3.378)	[19.666]	[27.660]
NETWORTH		36.122	19.834	[0.660]
LOAN FUNDS
1] Secured Loans		40.612	15.283	24.261
2] Unsecured Loans		59.781	22.768	17.296
TOTAL BORROWING		100.393	38.051	41.557
TOTAL		136.515	57.885	40.897
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		104.615	30.012	34.346
Capital work-in-progress		0.000	17.334	0.000
INVESTMENT		0.000	0.000	0.250
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	17.414	9.026	2.890
	Sundry Debtors	33.034	12.912	10.264
	Cash & Bank Balances	0.294	0.393	0.263
	Other Current Assets	2.313	0.921	0.742
	Loans & Advances	0.891	0.166	0.300
Total Current Assets		53.946	23.418	23.418
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	17.403	11.389	5.431
	Provisions	4.692	1.630	2.926
Total Current Liabilities		22.095	13.019	8.357
Net Current Assets		31.851	10.399	6.102
MISCELLANEOUS EXPENSES		0.049	0.140	0.199
TOTAL		136.515	57.885	40.897

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
Sales Turnover		129.069	77.284	35.718
Other Income		0.123	2.874	0.753
Total Income		129.192	80.158	36.471
Profit/(Loss) Before Tax		18.536	8.371	[3.862]
Provision for Taxation		2.080	0.344	--
Profit/(Loss) After Tax		16.456	8.027	[3.862]
Expenditures :
	Raw Material Consumed	49.243	25.893	14.999
	Purchases made for re-sale	7.362	11.250	0.000
	Consumption of stores and spare	2.817	0.000	0.000
	Increase/(Decrease) in Finished Goods	0.000	0.330	[0.541]
	Salaries, Wages, Bonus, etc.	1.827	1.748	1.742
	Payment to Auditors	0.076	0.065	0.052
	Interest	0.004	6.172	5.933
	Insurance Expenses	0.324	0.183	0.133
	Power & Fuel	12.505	0.695	0.027
	Depreciation & Amortization	7.828	4.366	3.466
	Other Expenditure	28.670	21.084	14.524
Total Expenditure		110.656	71.786	40.335

KEY RATIOS

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
PAT / Total Income	(%)	12.73	10.01	[10.59]
Net Profit Margin (PBT/Sales)	(%)	14.36	10.83	[10.81]
Return on Total Assets (PBT/Total Assets}	(%)	11.69	15.67	[7.91]
Return on Investment (ROI) (PBT/Networth)		0.51	0.42	[5.85]
Debt Equity Ratio (Total Liability/Networth)		3.39	2.57	[75.63]
Current Ratio (Current Asset/Current Liability)		2.44	1.80	1.73

LOCAL AGENCY FURTHER INFORMATION

Trade References

• Hindustan Unilever Limited
• Tata Chemicals Limited
• Bhaskar Venktesh

Fixed Assets

• Freehold Land
• Factory Building
• Plant and Machinery
• Furniture and Fixture
• Tractor and Tempo Trax

• Cycle
• Computers
• Office Equipments, Lab Equipments and other assets

Form No. 8

Name of the company	INDO BRINE INDUSTRIES LIMITED
Presented By	Compamy Secretary and Chief Adviser (legal) Gujarat Industrial Investment Corporation Limited
1) Date and description of instrument creating the change	21^st July 2001 Deed of Hypothecation executed by the Company in favour of Gujarat Industrial Investment Corporation Limited (GIIC) (hereinafter referred to as “the Lender”). A Certified copy of the said Deed of Hypothecation is enclosed.
2) Amount secured by the charge/amount owing on the securities of charge	The Term Loan Rs. 12.500 millions agreed to be lent and advanced by GIIC to the Company together with interest, additional interest, commitment charges, premium on payment or on redemption, costs, charges, expenses and all other moneys payable by the company to GIIC in terms of the Loan Agreement dated the 21^st day of July, 2001 executed between the Company of the One Part and the Lender of the Other Part.
3) Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given	The whole of the moveable properties of the Company including its movable plant and machinery, machinery spares, tools and accessories, dies, jigs, vehicles, equipments, furnitures and fixtures, electrical installations and fitting and all other movables, both present and future (save and expect book debts and current assets) pertaining to the Project situate at Survey No. 282, Salt City, Natioanal Highway, Dist: Kutch in the State Of Gujarat more particularly described as per annexure-A (hereinafter called the “said property) whether installed or not and whether now lying loose or in cases or whichare now lying or stored in or about or shall hereafter from time to time during the continuance of the security be brought into a upon or be stored or be in or about the Company’s factories, premises and godowns or wherever else the same may be or be held by any party to the order or disposition of the Company or in the course of transit or on high seas or on order or delivery, howsoever and wherever in the possession of the Company and either by way of substitution of addition.
4) Gist of the terms and conditions and extent and operation of the charge.	a) The charge operates as security, intealia, for the due repayment by the Company to GIIC of its Term Loan Rs. Together with interest, additional interest commitment charges, premia or prepayment or on redemption, costs charges, expense and all other moneys payable, by the Company to GIIC in terms of the said Loan Agreement. b) The charge in favour of GIIC under the said Deed of hypothecation is subject to tha charge(s) created and/or to be created by the Company in favour of its bankers on the Company’s stocks or raw materials, semi-finished and finished goods and consumables stores and book debts and such other movables as may be specifically permitted to secure its working capital requirements in the ordinary course of business. c) The company has undertaken to keep the goods hypothecated in marketable and good condition at its own costs and to insure the same in the joint names of the Company and the Lenders. d) All the goods hypothecated and all the realizations and insurance proceeds thereof and all documents in respect of the said security are to be keep distinguishable and held as the exclusive property of the Lenders. e) The security created under the said Deed of Hypothecation is to be a continuing security.
5) Name and Address and description of the person entitled to the charge.	Gujarat Industrial Investment Corporation Limited, 5^th Floor, Udyog Bhavan, Block No. 11 and 12, Sector – 11, Gandhinagar – 380 011.
6) Date and brief description of instrument modifying the charge	N.A.
7) Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.	N.A.

Corporate identity number of the company	U51100GJ1996PLC031160
Name of the company	INDO BRINE INDUSTRIES LIMITED
Address of the registered office or of the principal place of business in India of the company	Survey No. 282, Salt City, N. H. 8A, Near Village Chopadva, Bhachau, Kachchh – 370201, Gujarat
This form is for	Creation of charge
Type of charge	· Immovable property · Book debts · Others
Particular of charge holder	State Bank of Patiala Plot No. 20, Vrindavan Complex, Sector9, Gandhidham – 370 201, Gujarat, India
Nature of instrument creating charge	Agreement of loan overall limit Agreement of Hypothecation of goods and assets Memorandum of deposit of title deeds for creation of charge for overall limit.
Date of instrument Creating the charge	31.012008
Amount secured by the charge	Rs. 30.000 Millions
Brief particulars of the principal terms and conditions and extent and operation of the charge	Rate of Interest At BPLR i.e. 13% p.a. floating on monthly basis subject to change from time to time. Terms of repayment Cash Credit repayable on demand. Margin Finished Goods : 25% Receivables (upto 90 days) : 35% Extent and operation of the charge The charge on the properties of the company shall operate as first and exclusive charge in favor of State Bank of Patiala, Gandhidham to secure the principal amount together with interest, additional interest, expenses and other moneys payable by the company to the State Bank of Patiala, Gandhidham.
Short particulars of the property charged (including location of the property)	First charge by way of hypothecation of all the stocks of goods, and current assets including book debts. First charge by way of Equitable Mortgage of Residential Plot No. 242, situated at Sector 4, Gandhidham-Kutch admeasuring 1101.64 sq. yards i.e. 920.97 Sq. Mtrs. Standing in the name of Shri Jatin Satyanarayan Agrawal and Smt. Shyamaben Atmaram Agrawal.

AS PER WEBSITE

Profile

Salt is the basic ingredient of food, and modern salt undergoes a complete refining process. They are a distinguished manufacturer, exporter and supplier of Refined Free Flow Iodized Salt and various grades of Industrial Salt under the brand name of KOHINOOR. The salt produced by them contains NaCl to the extent of 99.50%. Strategically located at the village salt city of Chopadava near Gandhidham, Kutchh, the company caters to the worldwide market with quality, purity and fast service as the basic parameters.

Their motto at Indo Brine Industries Limited remains to evolve the best practices in the field of management and technology and thereby, provide the best quality products and services to their esteemed customers. Indo Brine Industries Limited is a sister concern of Agrawals Group of Companies. The group has automobile dealership of two wheelers and four wheelers and is also engaged in diverse sectors like automobile finance, transportation, export-and-shipping, liquid storage tank farms and salt refining.

Infrastructure

They are equipped with a state of the art infrastructure with all the stainless steel equipments and machinery. Their sound infrastructure and adherence to strict quality control enables them to cater to the market demands successfully. The list of machinery at their disposal includes specially designed Wash/Clarifier Tanks, other washing & drying plants, 4 fully automatic Mico Bosch FFS Packing Machines, etc. Their manufacturing unit has been designed, engineered, erected and commissioned by SSP Limited of Faridabad. They have a covered & dust-proof packing division where the salt is packed under highly hygienic conditions. At present, the existing installed capacity of the plant is 300MT to 500MT/day.

The manufacturing process involves preparing of brine from the raw salt and multiple washing stages. The slurry then undergoes centrifugation process for filtration that results in the production of salt cakes that are free from impurities like iron and other insolubles including calcium and magnesium. These salt cakes are dried in the fluidized bed dryer and after iodization, sieved for proper granular size and mixed with free flowing agent. Thereafter, the pure final product is obtained.

Location

The manufacturing facility is located at village Salt city at Chopadava, survey no. 282 on the National Highway No. 8 A. This is at a distance of 26 Kms from Gandhidham, the city which houses administrative offices of Kandla Port Trust, all Governmental offices, Port and Customs, clearing, stevedoring and forwarding companies. The plant is situated in center of the major Quality salt harvesting areas. The city possesses all modern communication facilities and is very easily accessible by Rail, Road as well as Airways.

Should there be any requirement for catering the foreign market, their plant is strategically located near the Kandla Port, one of the major ports of India, to make the exports convenient and economical.

Subject is a sister concern of Agrawals Group of companies.

Promoters

The group has interests in well-diversified areas like Automobile dealership of two wheeler and four wheelers and automobile finance, Transportation, Export-and-shipping, liquid storage tank farms and salt refining. The promoters of the company are very sound, reputed and experienced businessmen with their total turnover running into several Million Dollars . The promoters enjoy a very good market reputation and major portion of market in their respective business activities.

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.42.89
UK Pound	1	Rs.83.80
Euro	1	Rs.66.45

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	4
--LIQUIDITY	1~10	4
--LEVERAGE	1~10	6
--RESERVES	1~10	3
--CREDIT LINES	1~10	5
--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	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	NO
TOTAL		44

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

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

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

RATING EXPLANATIONS

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

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