MIRA INFORM REPORT

Report Date :

25.06.2008

IDENTIFICATION DETAILS

Name :	FLAWLESS DIAMONDS INDIA LIMITED
Registered Office :	120, Prasad Chambers, Opera House, Mumbai - 400004, Maharashtra
Country :	India
Financials (as on) :	31.03.2008
Date of Incorporation :	02.05.1989
Com. Reg. No.:	51577
CIN No.: [Company Identification No.]	U36911MH1989PLC051577
IEC No.:	0389030163
PAN No.: [Permanent Account No.]	AAACF0778R
Legal Form :	A closely held public limited liability company
Line of Business :	Manufacturer, Retailers and Trader of Cut and Polished Diamonds and Diamond Jewellery

RATING & COMMENTS

MIRA’s Rating :

A

RATING		STATUS	PROPOSED CREDIT LINE
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

Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established and reputed company having fine track. Directors are reported as experienced, respectable and having satisfactory means of their own. Trade relations are fair. General financial position is good. Payments are reported as usually correct and as per commitments. The company can be considered good for normal business dealings at usual trade terms and conditions. It can be regarded as a promising business partner in a medium to long-run.

INFORMATION PARTED BY

Name :	Mr. Bhawar U. Jain
Designation :	Managing Director
Contact No.:	91-9819088199
Date :	24.06.2008

LOCATIONS

Registered Office :	120, Prasad Chambers, Opera House, Mumbai - 400004, Maharashtra, India
Tel. No.:	91-22-23002261 / 62 / 23637756 57
Fax No.:	91-22-23669308
E-Mail :	flawlessindia@yahoo.com info@flawlessdiamond.in info@aumjewellery.com
Website :	http://www.aumJewellery.com
Area :	290 sq. ft. [Rented]
Factory 1 :	G-53, UPSIDC, Industrial Area, Selaqui District, Dehradun - 248197
Tel. No.:	91-135-6454443
Fax No.:	91-135-2698736
E-Mail :	Flawless_ddn@yahoo.co.in
Area :	4777.44 sq. ft. [Owned]
Factory 2 :	401, Harsh Park, Kalapessess Street Nanpura, Surat – 395001
Area :	300 sq. ft. [Owned]
Bonded Warehouse :	4^th Floor, Novelty Chambers, M. S. Road, Grant Road, Mumbai - 400007

DIRECTORS

Name :	Mr. Kamal U. Jain
Designation :	Chairman
Address :	51, Kalpvraksh, 27, Ridge Road, Walkeshwar, Mumbai – 400006
Date of Birth/Age :	25.06.1960
Qualification :	Graduate
Experience :	18 Years
Date of Appointment :	02.05.1989
Expertise in Specific Functional Area :	A Visionary with great ideas and foresight has been behind the Company and nurtured it since it’s inception. He is very passionate about research and development which he feels is not just a step but a continuous process for innovation and enhancement of products line and brand equity. Knowledge and expertise across diverse industry disciplines viz; Project and Finance Management in reality and Jewellery industry has contributed to the multi-dimensional growth of the company.
List of Directorship :	Aaradhak Developers Private Limited Aum Realtors Private Limited Flawless Developers Private Limited Goodwill Theaters Private Limited Jalak Impex Private Limited Kanir Constructions Private Limited Karat Diamond Private Limited Safe Heaven Builders Private Limited Sanaudit Synthetic Private Limited Secure Builders Private Limited Ujjawal Developers Private Limited
Name :	Mr. Bhawar U. Jain
Designation :	Managing Director
Address :	51, Kalpvraksh, 27, Ridge Road, Walkeshwar, Mumbai – 400006
Date of Birth/Age :	08.10.1958
Qualification :	Graduate
Experience :	20 Years
Name :	Mr. Anil U. Jain
Designation :	Director
Address :	51, Kalpvraksh, 27, Ridge Road, Walkeshwar, Mumbai – 400006
Date of Birth/Age :	23.05.1964
Qualification :	Graduate
Experience :	15 Years
Date of Appointment :	24.09.2004
Name :	Mr. Gautam Banerjee
Designation :	Director
Address :	A/1406, Build No. 1, Dheeraj, Tower, Khatau Mill Compound, Borivali [East], Mumbai – 400066
Date of Birth/Age :	22.07.1967
Qualification :	Jewellery Designer
Experience :	20 Years
Date of Appointment :	09.11.2006
Expertise in Specific Functional Area :	A creative genius he lends lot of credibility to brand “AUM” with his design repertoire Fabulous design elements added to fascinating diamond Jewellery products, makes is truly flawless. An international design guru with exposure to Tiffany’s, Harry Winston, H. Ritani under his belt, he is a talent to reckon with. The lyrical passion and enigmatic brushstrokes of a poet and painter are vividly showcased in his designs. His design element executed exudes his art and craft.
List of Directorship :	Sumona Jewels Private Limited
Name :	Mr. Rajendra L. Jain
Designation :	Director
Address :	9^th Floor, Novelty Chambers, Grant Road, M. S. A. Road, Mumbai – 400007
Date of Birth/Age :	01.07.1955
Qualification :	Graduate
Experience :	20 Years
Date of Appointment :	07.03.2003
Expertise in Specific Functional Area :	He has vast experience in the Construction and Entertainment industry and his administrative ability will assist the company
List of Directorship :	Goodwill Theaters Private Limited Goodwill Traders Private Limited
Name :	Mr. Deepak K. Parekh
Designation :	Director
Address :	Sagar Darshan, Flat No. 2, 1^st Floor, 81/83 Bhulabhai Desai Road, Mumbai – 400026
Date of Birth/Age :	10.03.1959
Qualification :	C.A.
Experience :	20 Years
Date of Appointment :	19.09.2003
Name :	Mr. Rajeev Kamdar
Designation :	Director
Address :	Plot No. 15, Mysore Colony, Near R. C. F. Gate No. 2, Chembur, Mumbai – 400074
Date of Birth/Age :	16.11.1963
Qualification :	M.B.A.
Experience :	20 Years
Date of Appointment :	09.11.2006
Expertise in Specific Functional Area :	He is in the prime of his organizational life with a world of accolades in import – export and international business
Name :	Mr. Sanjay N. Kantawala
Designation :	Director
Address :	74, Dariya Mahal – II, 80, Nepean Sea Road, Mumbai – 400006
Date of Birth/Age :	07.04.1967
Qualification :	Advocate
Experience :	15 Years

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

Names of Shareholders	No. of Shares
Abhishek B. Jain	1000000
Anil U. Jain	77700
Bhawar U. Jain	92700
Jalak Impex Private Limited	283100
Jalak K. Jain	1000000
Kamal U. Jain	287600
Mainadevi U. Jain	131700
Malli B. Jain	77900
Sunita K. Jain	114900
Sunita A. Jain	133100
Uttamchand A. Jain	124500

BUSINESS DETAILS

Line of Business :

Manufacturer, Retailers and Trader of Cut and Polished Diamonds and Diamond Jewellery

Products :

Product Description	ITC Code No
Diamond	71-0239-01
Jewellery	71.13

Brand Names :

“AUM”

Exports :

Products	Countries
Cut and Polished Diamond	USA, UK, Hongkon and Dubai
Diamond Jewellery	USA, UK, Hongkong and Dubai

Imports :

Products	Countries
Routh Diamond	Belgium, Israel, Dubai and Hongkong
Cut and Polished Diamond	USA, UK, Hongkong, Dubai and Japan

Terms :

Selling :

Credit [90 days]

Purchasing :

Credit [90 days]

PRODUCTION STATUS [As on 31.03.2007]

Particulars	Unit	Actual Production
Cut and Polished Diamonds	Cts.	24462.46

GENERAL INFORMATION

Suppliers :

Name of the suppliers and their contact numbers	Location	Relationship [No. of years]	Credit Period Allowed
Anki Impex Limited Tel No. 23662245	Hong Kong	4 Years	180 Days
Jewelmax Company Tel No.: 25288508	Hong Kong	4 Years	180 Days
Diamond [M.E.] DMCC Tel No. : 009714/2952392	Dubai	4 Years	180 Days
HRP Diam B. V. B. A. Tel No.: 03-401.18.18.	Belgium	4 Years	180 Days
M. Rajesh B. V.B. A. Tel No. 3232320122	Belgium	4 Years	180 Days

Customers :

• Retailers
• End Users

Name of the customers and their contact numbers	Location	Relationship [No. of years]	Credit Period Allowed
Kowloon Trading Company Tel No.: 00852-2722-5540	Hong Kong	5 Years	180 Days
Brillian Thai Gems Limited Tel No.: [213] 891-1789	California	5 Years	180 Days
Real Thai Gems Limited Tel No.: 0062-234-2468	Bangkok	5 Years	180 Days
Hassan Gems L.L.C.	Dubai	5 Years	180 Days
AMG Company Limited	Bangkok	5 Years	180 Days

No. of Employees :

151 [In Office : 58; In Factory : 75; In Branch : 18]

Bankers :

The Bank of Rajasthan Limited

Mittal Tower, ‘C’ Wing, Overseas Branch, Nariman Point, Mumbai – 400021

Nature of Credit Facility	Sanctioned Loan Amount
Funded Non Funded	Rs. 440.000 Millions
Non Funded	Rs. 30.000 Millions

Punjab and Sind Bank

International Banking Division, Dilwara Society, 8, M K Road, Nariman Point, Mumbai – 400021

Credit Limit : Rs. 200.000 Millions

ING Vysya Bank Limited

Facilities :

Secured Loan	Rs. In Million [As on 31.03.2007]
Short term Loan from Bank of Rajasthan Limited [against Foreign Bills for collection]	146.022
Cash Credit	0.000
Car Finance	1.016
Total	147.038
Notes : The short term loan is against Foreign Bills for collection and cash credit loan from the Bank is secured by hypothecation of book debts, stock in trade and further secured by equitable mortgage of residential flats and office premises belonging to Directors and their sister concerns and guaranteed and Managing Directors and two other Directors in their personal capacity. Car finance is secured by hypothecation of vehicles owned by the Company.

Banking Relations :	Satisfactory
Auditors :
Name :	Suresh Anchaliya and Company Chartered Accountants
Address :	1608, Pancharatna, Opera House, Mumbai – 400004
Tel. No.:	91-22-23666546 / 23666547
Fax No.:	91-22-23666546
E-Mail :	anchaliyaca@gmail.com
Associates/Subsidiaries :	Jalak Impex Private Limited Goodwill Theatres Private Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
20000000	Equity Shares	Rs. 10/- each	Rs. 200.000 Millions
250	Preference Shares	Rs. 100/- each	Rs. 0.025 Million
	Total		Rs. 200.025 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
16678000	Equity Shares	Rs. 10/- each	Rs. 166.780 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2008	31.03.2007	31.03.2006
SHAREHOLDERS FUNDS
1] Share Capital		166.780	57.900	52.900
2] Share Application Money		0.000	199.425	21.600
3] Reserves & Surplus		519.518	130.885	59.410
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		686.298	388.210	133.910
LOAN FUNDS
1] Secured Loans		650.021	147.039	67.666
2] Unsecured Loans		93.100	106.000	0.000
TOTAL BORROWING		743.121	253.039	67.666
DEFERRED TAX LIABILITIES		0.904	0.903	0.902
TOTAL		1430.323	642.152	202.478
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		23.981	9.941	7.197
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		0.000	0.000	0.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	696.170	436.979	159.594
	Sundry Debtors	1662.478	1404.051	1328.062
	Cash & Bank Balances	241.442	44.948	26.021
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	69.339	14.869	22.955
Total Current Assets		2669.429	1900.847	1536.632
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	1242.061	1252.570	1337.795
	Provisions	21.250	16.402	4.004
Total Current Liabilities		1263.311	1268.972	1341.799
Net Current Assets		1406.118	631.875	194.833
MISCELLANEOUS EXPENSES		0.224	0.336	0.448
TOTAL		1430.323	642.152	202.478

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2008	31.03.2007	31.03.2006
Sales Turnover		5623.685	3012.661	2953.747
Other Income		5.171	1.313	0.463
Exchange Difference		0.000	14.832	[25.557]
Total Income		5628.856	3028.806	2928.653
Profit/(Loss) Before Tax		272.613	89.051	9.235
Provision for Taxation		21.324	16.404	3.828
Profit/(Loss) After Tax		251.289	72.647	5.407
Earnings in Foreign Currency :
Total Earnings		NA	1471.364	2012.877
Imports :
Total Imports		242.383	1691.064	2057.466
Expenditures :
	Cost of Material and Purchased	5616.532	3173.811	2977.470
	Manufacturing and Import Expenses	3.813	4.036	0.942
	Payment to and provisions for employees	0.000	5.711	2.450
	Selling and Administrative Expenses	0.000	19.569	17.567
	Interest and Finance Charges	33.450	12.608	5.964
	Increase/(Decrease) in Finished Goods	[301.202]	[277.385]	[86.070]
	Depreciation & Amortization	3.650	1.290	0.982
	Other Expenditure	0.000	0.112	0.112
Total Expenditure		5356.243	2939.752	2919.417

KEY RATIOS

PARTICULARS		31.03.2008	31.03.2007	31.03.2006
PAT / Total Income	(%)	4.46	2.40	0.18
Net Profit Margin (PBT/Sales)	(%)	4.85	2.96	0.31
Return on Total Assets (PBT/Total Assets}	(%)	10.12	4.66	0.60
Return on Investment (ROI) (PBT/Networth)		0.40	0.23	0.07
Debt Equity Ratio (Total Liability/Networth)		2.92	3.92	10.53
Current Ratio (Current Asset/Current Liability)		2.11	1.50	1.15

LOCAL AGENCY FURTHER INFORMATION

INSURANCE DETAILS

Policy No. / Cover note	Validity	Sum Assured
021500/46/07/45/00000158	23/03/2008 to 22/03/2009	Rs. 600 Millions

MANAGEMENT DISCUSSION AND ANALYSIS REPORT: 

THE RETAIL INDUSTRY 

The Indian Domestic Diamond Jewellery market is estimated at more than Rs.80000 Millions. A large part of the growth in the Gem & Jewellery Industry is fuelled by the branded segment, which hurtled northwards at an amazing growth rate of more than 35%. The branded Jewellery market in India is likely to touch USD 2.28 bn by 2010. Organized players still account for less than 5% of the total estimated market as traditionally Indians have relied on close relatives, friends or people known to them for procuring precious Jewellery. However, this equation is expected to change gradually in favour of the organized players. For retailing of branded Jewellery, the Company has geared itself for establishing a large and strong retail setup with a Pan India presence. The organized Jewellery market is growing rapidly and consumers are increasingly willing to visit branded Jewellery stores for even serious Jewellery shopping. The exports potentials too are enormous. The gems and Jewellery industry is the second largest net foreign exchange earners of India. India has several well-recognized strengths, which have made it a significant force in the global Gems & Jewellery business such as highly skilled, yet low cost labour, established manufacturing excellence in Jewellery and diamond polishing, India is the most technologically advanced diamond cutting centre in the world, opportunity to address one of the world's largest and fastest growing Gems and Jewellery markets, opportunity to leverage India's strengths to address the global market. 

In line with the Indian Government's Policy of making India a Global Hub for the Gems and Jewellery Business, the Company ventured into the business of designer diamond Jewellery, to be marketed Internationally as well as Locally by launching an International exclusive Designer Class Jewellery Brand namely "AUM". The Company unveiled thousands of exclusive designer diamond Jewellery, under its Brand AUM catering to different consumer segments and price points, both for the domestic and the international market, through various channels, both in the retail as well as wholesale space. Realigning the Company's focus towards retailing of Branded Jewellery in line with the changing demographic, socio-graphic and economic factors in the Indian Economy, for the domestic market, the Company chalked out aggressive plans for foraying into retailing of branded diamond Jewellery. To augment it's visibility in the retail space and position its brand favorably, the Company inaugurated its retail venture, "AUM GALLERIA", a chain store for retailing of branded Jewellery. The strategically located prestigious showroom covers approx. 5000 sq. ft. in the heart of South Mumbai. The Company finalized its retailing marketing strategies signing exclusive franchisee agreement with multi product retail outfits, having a Pan India presence. To support its retail initiatives, the Company created an extensive Design Bank to meets its current and future Jewellery design requirements. This Design Studio is considered to give sufficient strength to the brand AUM Jewellery for the local and overseas market. Also, the appointment of Mr. Gautam Banerjee, India's renowned Jewellery designer, on the Board of the Company, to design the entire collection of AUM Jewellery will further add to the Company's designing capabilities.

Extracts of the meeting of the board of directors of the company flawless diamond [India] Limited. Held on 12^th December, 2007 at it’s registered office at 120, Prasad Chambers, Opera House, Mumbai – 400004

Shri. Bhawar U. Jain informed to the Board about application with Corporation Bank, Earnest House, 1^st Floor, NCPA Marg, Mumbai – 400021 for credit facility for funded and non funded limit for Rs. 160 Millions and also act as a consortium Bank for credit facility and it is necessary to get the consent of the Board of Directors of the company for borrowing funds from the bank.

“RESOVED THAT Consent of Board of Directors of the company be and is hereby given to the company to accept the terms and conditions of the sanction letter of Corporation Bank, Earnest House, 1^st Floor, NCPA Marg, Nariman Point, Mumbai – 400021 for credit facilities of Rs. 160 Millions in consortium with Lead Banker.

TRADE REFERENCE

Classic Diamond [India] Limited

1002, Prasad Chambers, Opera House, Mumbai – 400004

Mr. Kumarbhai Chandrakant Bansali [Managing Director]

Tel No. : 91-22-40361000

Mobile No.: 91-9821013855

N. Kumar Diamond Export Private Limited

1511, Prasad Chambers, Opera House, Mumbai – 400004

Mr. Niranjanbhai Amratlal Shah

Tel No.: 91-22-40907900

Mobile No.: 91-9867326322

Dhanraj Dhadda Private Limited

1308, Pancharatna, Opera House, Mumbai – 400004

Mr. Nehalchand D. Dhadda

Tel No.: 91-22-23680072 / 23632603

Polar Star

247, Panchratna, Opera House, Mumbai – 400004

Mr. Anupnbhai Pravin Zaveri

Tel No.: 91-22-23666333 / 23666887

Mobile No.: 91-9821230482

FIXED ASSETS

• Air Conditioner
• Computer
• Motor Car
• Furniture and Fixtures
• Residential Flat
• Office Premises
• Office Equipments
• Factory Premises
• Fire Extinguisher
• Machinery
• Motor Cycle
• Television

OPERATING STATEMENT

Rs. In Millions

Particulars	Projected
	2009	2010
Gross Sales
Diamonds	4500.000	6500.000
Jewellery	3500.000	5500.000
Exchange Diff.	0.000	0.000
Net Sales	8000.000	12000.000
Cost of Sales
R M Purchase	7603.200	11280.000
Power and Fuel	8.612	10.000
Staff Salary	8.000	11.400
Productions Expenses	15.000	19.000
Depreciation	6.500	7.500
Rent Rates and Taxes	11.500	12.500
SUB-TOTAL	7652.812	11340.400
Add : Opening Stock	1364.500	1764.500
SUB TOTAL	9017.312	13104.900
Less : Closing Stock	1764.500	2164.500
SUB TOTAL COST OF SALES	7252.812	10940.400
GROSS PROFIT	747.188	1059.600
SELLING AND ADMINISTRATIVE EXPENSES	48.000	72.000
OPERATING PROFIT	699.188	987.600
INTEREST	125.220	125.220
OPERATING PROFIT AFTER INT.	573.968	862.380
Other Income and Expenses	0.000	0.000
Add : Income
Exchange Diff.	0.000	0.000
Int. Div. Sundry	1.500	1.500
Misc. Income	0.000	0.000
SUB TOTAL [INCOME]	1.500	1.500
Less Expenses
Exp. And Adjustments	0.000	0.000
Preliminary Expenses	0.112	0.112
Sub Total [Expense]	0.112	0.112
NET OF OTHER INCOME	1.388	1.388
Profit Before Tax
From Jewellery	400.000	685.000
From Diamonds	172.580	175.992
PROFIT BEFORE TAX	572.580	860.992
PROVISION FOR TAX	103.968	141.621
NET PROFIT AFTER TAX	468.612	719.371
PAT / Net Sales [%]	5.86 %	5.99 %
EBIDTA	704.300	993.712
REVENUE GROWTH	145.32 %	150.00 %
RETURN ON INVESTMENT	46.29 %	44.44 %
PROFIT EQUITY RATIO	2.81	4.31
COST TO INCOME RATIO
RETURN ON NET WORTH	37.89 %	37.13 %
EPS	28.10	43.13
% RISE [+] or fall [-]
Dividend	18.763	18.763
Retained Profit	449.850	700.609

ANALYSIS OF BALANCE SHEET

[Rs in Millions]

Particulars	Projected
	2009	2010
CURRENT LIABILITIES
01 Short – Term borrowings from banks [including bill purchased, discounted and excess borrowings placed on repayment basis]
I] From applicant Bank	1000.000	1000.000
Sub Total [A]	1000.000	1000.000
02 Short Term Borrowings from others	0.000	0.000
03 Sundry creditors [Trade]	1050.000	1050.000
04 Advance payments from customers  / Deposits from dealers	0.000	0.000
05 Provision for tax [net of Tax paid]	25.992	35.405
06 Dividend and Dividend Tax payable	0.000	0.000
07 other statutory liabilities [due within one year]	0.000	0.000
08 Deposits / Installments of term loans / DPGs / debentures, etc [due within one year]	0.200	0.200
09 Other current liabilities and provisions [due within one year]	2.500	2.500
Sub – Total [B]	1078.692	1088.105
10 TOTAL CURRENT LIABILITIES [Total of 1 to 9]	2078.692	2088.105
TERM LIABILITIES
11 Debentures [not maturing within one year]	0.000	0.000
12 Preference Shares [Redeemable after 1 year]	0.000	0.000
13 Term loans [excluding installments  payable within one year]	0.416	0.216
14 Deferred Sales Tax / Deferred Loan Deferred Payment Credit [Excluding installments due within one year]	0.000	0.000
15 Term deposit [repayable after one year]	0.000	0.000
16 other Term Liabilities	0.000	0.000
17 TOTAL TERM LIABILITIES [Total of 11 to 16]	0.416	0.216
18 TOTAL OUTSIDE LIABILITIES [10 + 17]	2079.108	2088.321
NET WORTH
19 Ordinary Share Capital	166.780	166.780
Share Application Money	0.000	0.000
Unsecured loans from Directors	106.000	106.000
20 General Reserve	0.000	0.000
21 Deferred Taxation	0.902	0.902
22 Other Reserves [Excluding provisions]	152.100	152.100
23 Surplus [+] or deficit [-] in Profit and Loss Account	811.107	1511.716
24 NET WORTH [19+23]	1236.889	1937.498
25 TOTAL LIABILITIES [18+24]	3315.997	4025.819
CURRENT ASSETS
26 Cash and Bank Balance	11.872	11.872
27 Investments [Other than long term investments] Government and other Trustee securities	0.000	0.000
I] Fixed deposit with bank	0.000	0.000
II] Share with Co-operative Bank	28.285	28.285
28 I] Receivables other than deferred and exports [Including bills purchased and discounted by banks]	730.888	926.892
II] Export receivables [Including bills purchased / discounted by banks]	575.000	655.000
29 Instalments of Deferred  receivables [due within one year]
30 Inventory
I] Raw materials [Including stores and other items used in the process of manufacture]
Imported	584.500	584.500
Indigenous
II] Stock – in – process
II] Finished Goods	1180.000	1580.000
IV] Other consumable spares	0.000	0.000
Imported
Indigenous
31 Advances recordable in Cash or kind
32 Advance payment of taxes [NET]	0.000	0.000
33 Excise and Sales Tax Refund	0.000	0.000
Other current assets	22.817	29.135
Deposits for showrooms	105.000	135.000
34 TOTAL CURRENT ASSETS [Total of 26 to 33]	3238.362	3950.684
FIXED ASSETS
35 Gross Block	103.204	108.204
36. Depreciation to date	25.794	33.294
37 NET BLOCK [35-36]	77.410	74.910
OTHER NON – CURRENT ASSETS
38 Investments / book / debts / advances / deposits which are not Current Assts	0.000	0.000
I] [a] Others Investments in Subsidiary	0.000	0.000
[b] Others companies / affiliates	0.000	0.000
II] Advances to suppliers of capital goods and contractors	0.000	0.000
III} Deferred receivables [maturity exceeding one year]	0.000	0.000
IV] Others	0.000	0.000
39 Non consumables Stores and Spares	0.000	0.000
40 Other non – current assets including dues from directors	0.000	0.000
41 TOTAL OTHER NON – CURRENT ASSETS [total of 38 to 40]	0.000	0.000
42 Intangible assets [Patents, goodwill, prelim, expenses, bad / doubtful debts Not provided for etc.]	0.225	0.225
43 TOTAL ASSETS [Total of 34, 37, 41 and 42]	3315.997	4025.819
44 TANGIBLE NET WORTH [24-22]	1236.664	1937.273
45 NET WORKING CAPITAL [17 + 24]-[37+41+42] to tally with [34-10]	1159.670	1862.579
46 Current Ratio  [Items 34/10]	1.56	1.89

SHRI BHAWAR U JAIN

CAPITAL ACCOUNT FOR THE YEAR ENDED 31.03.2007

Particulars	Amount	Particulars	Amount
To Advance Tax	0.005	By Opening Balance	0.374
To Bank Commission	0.001	By Dividend	0.093
To Birla Sun Life Insurance	0.058	By Income Tax Refund	0.036
To Drawings	0.092	By PPF Interest	0.025
To LIC	0.045	By Salary From Flawless Diamond	0.240
To Loss From Kamal and Company	0.098
To Mediclaim Insurance	0.009
To Skorydov Digital Signature	0.002
To TDS	0.024
To Wealth Tax	0.029
To Balance trf. To B/S	0.405	By Balance trf. To From Income and Expenses A/c
Total	0.768	Total	0.768

BALANCE SHEET AS ON 31.03.2007

Particulars	Amount	Particulars	Amount
Capital Account	0.405	Flawless Diamond [India] Limited	68.950
Blue Heavan Society	0.010	Ing Vysya Life Insurance A	0.700
Anil and Company	8.799	Jewellery	2.690
Harsh Diamonds	87.471	Asha Cine Equipments Private Limited	0.105
		Eminent Buld. Private Limited	0.100
		Goodwill Theatre Private Limited	0.665
		Sanyati Construction Private Limited	8.650
		PPF	0.338
		B. V. Corporation	0.267
		Jain Impex	0.040
		Kamal and Company Mumbai	7.055
		Poddar Moovies	0.324
		S. A. Enterprises	0.170
		S. A. Film Combine	0.673
		Sajani Traders	0.047
		Asha Cine Equipments Private Limited [Sh]	0.011
		Esoft Counst. Limited [Shares]	0.050
		Flawless Diamonds India Limited [Sh]	0.857
		Lasolitaire Jewels Private Limited	4.700
		Pentagon Global [Sh]	0.001
		Sri Sarita Synt. Limited [Sh]	0.134
		Cash –in – hand	0.051
		The Vysya Bank Limited C A/c	0.107
Total	96.685	Total	96.685

MR. KAMAL U JAIN

INCOME AND EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31.03.2007

Particulars	Amount	Particulars	Amount
To Bank Commission	0.005	By Long Term Capital Gain	5.201
To Short Term Capital Loss [111A]	0.009	By Brokerage	0.125
		By Interest from PPF	0.025
		By Dividend	0.405
		By Meeting Fees	0.006
		By F and O Profit	0.019
		By Interest on Kisan Vikas Patra	0.128
To Balance trf. To Capital A/c	5.911	By Profit from M/s Gopuram Developers	0.016
Total	5.925	Total	5.925

CAPITAL ACCOUNT FOR THE YEAR ENDED 31.03.2007

Particulars	Amount	Particulars	Amount
To Advance Tax	0.020	By Opening Balance	62.558
To Drawings	0.078
To LIP	0.180	By Profit trf. To From Income and Expenses A/c	5.911
To Mediclaim	0.010
To TDS	0.006
To Wealth Tax	0.031
To Digital Singnature Expenses	0.002
To Balance trf. To B/S	68.142
Total	68.469	Total	68.469

BALANCE SHEET AS ON 31.03.2007

Particulars	Amount	Particulars	Amount
Capital Account	68.142	Diamond and Gold Jewellery	1.730
Kunjalata Traders	0.212	Flat	2.744
Sanyati Exports	104.404	Furniture	0.125
Harsh Diamonds	0.018	Silver Articles	0.024
		Investment in Shares	15.265
		Capital with Abhishek Corporation	19.874
		Capital with Anil and Company	16.344
		Acharya Shree Nanesh Samta Trust	0.303
		Gopuram Developers	49.693
		Jalak Impex Private Limited	0.170
		Kanir Constructions Private Limited	0.325
		Karat Diamond Private Limited	0.010
		Lalji Bhai Solanki	0.100
		PPF	0.338
		Sanyati Constructions Private Limited	5.265
		Secure Builders Private Limited	0.410
		Ing Vysya Life Insurance	0.400
		Cash in Hand	0.010
		Bank of Rajasthan	0.003
		Ing Vysya Bank Limited [C/A]	0.030
		Kishan Vikas Patra [Post Office]	2.000
		Goodwill Theatre Private Limited	2.935
		Flawless Diamond India Limited	37.050
		Karma Infrastructure and Developers	17.500
		KVP Accrued Interest	0.128
Total	172.776	Total	172.776

MR. ANIL U. JAIN

CAPITAL ACCOUNT FOR THE YEAR ENDED 31.03.2007

Particulars	Amount	Particulars	Amount
To Advance Tax	0.010	By Opening Balance	75.259
To Drawings	0.094	By interest from PPF	0.025
To Income Tax	0.106	By Dividend	0.086
To LIP	0.037	By Meeting Fees	0.005
To Mediclaim	0.008	By Brokerage	0.175
To Wealth Tax	0.051
To Bank Commission	0.005
To Short Term Capital Loss	0.216
To TDS	0.009
To Legal Fees	0.028
To Digital Signature	0.002
To Loss fro Khushboo Gems	0.001
To Closing Balance trf to BS	74.983
Total	75.550	Total	75.550

BALANCE SHEET AS ON 31.03.2007

Particulars	Amount	Particulars	Amount
Capital Account	74.983	Jewellery	1.721
Sanaudit Synthetics Private Limited	0.025	Silver Articles	0.022
Sanyati A. Jain	0.085	Television	0.010
		Khushboo Gems	70.069
		V. B. Exports	0.003
		PPF	0.338
		Gandhinagar Court Deposit	0.400
		Cash in Hand	0.021
		ING Vysya Bank Limited [C/A]	0.052
		Investment in Shares	2.446
		Sanyati Exports	0.011
Total	75.093	Total	75.093

MR. KHUSHBOO GEMS

TRADING AND PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31.03.2007

Particulars	Amount	Particulars	Amount
To Purchases		By Sales	0.000
Polished Diamond	70.047	By Closing Stock
To Bank Commission	0.000	Polished Diamond	70.047
To Import and Export Code Expenses	0.001	By Net Loss Trf. To Cap A/c	0.001
Total	70.048	Total	70.048

BALANCE SHEET AS AT 31.03.2007

Particulars	Amount	Particulars	Amount
Capital Account	70.069	Cash in Hand	0.012
		ING Vysya Bank Limited	0.011
		Inventory	0
		Polished Diamond	70.046
Total	70.069	Total	70.069

Ms. MALLI B. JAIN

INCOME AND EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31.03.2007

Particulars	Amount	Particulars	Amount
To Bank Commission	0.003	By Short Term Capital Gain	0.221
To Share Expenses	0.010	By Interest on Loan	0.248
	0	By Interest of PPF	0.016
To balance trf. To B/S	0.642	By Interest on Bank and FDR	0.001
		By Dividend	0.169
Total	0.655	Total	0.655

CAPITAL ACCOUNT FOR THE YEAR ENDED 31.03.2007

Particulars	Amount	Particulars	Amount
To Advance Tax	0.010	By Opening Balance	40.520
To Drawings	0.071	By Balance trf. To From Income and Expenses A/c	0.642
To Electric Expenses	0.065
To Income Tax	0.003
To LIP	0.066
To Digital Signature Expenses	0.002
To PPF	0.015
To Society Maintenances	0.061
To Wealth Tax	0.011
To Balance trf. To B/S	40.858
Total	41.162	Total	41.162

BALANCE SHEET AS ON 31.03.2007

Particulars	Amount	Particulars	Amount
Capital Account	40.859	Flat at Kalpvarksha	2.745
Harsh Diamonds	34.698	Flat Deposit	16.820
		Furniture	0.116
		Diamond and Gold Jewellery	0.861
		Gopuram Developers	9.500
		PPF	0.236
		Suchek Jain	1.633
		Sucheta Jain	1.390
		Upper Crust Builders Private Limited	22.385
		Aashtha Broad [Share]	0.057
		Asrta Micro [Share]	1.959
		Bank of Maharashtra [Share]	0.002
		Birla Cap. [Shares]	0.058
		Enpee Sug Ch. [Shares]	0.065
		Finance Tech [Shares]	0.613
		Flawless Diamonds India Limited [Sh]	0.820
		Goodwill Theaters Private Limited	10.125
		Hind Zinc [Sh]	0.059
		IBP Company Limited	0.027
		ONGC [Sh]	0.050
		Safe Heavan Build Private Limited [Sh]	0.094
		Sanaudit Synt. Private Limited [Sh]	0.044
		Sanyati Cons. Private Limited	0.098
		Secure Build Private Limited [Sh]	0.001
		Sofcom Systems Limited [Sh]	0.004
		Sterlite in [Sh]	0.427
		Tata Consultancy [Sh]	0.014
		Upper Crust Builders Private Limited	0.096
		Vakrangee [Sh]	4.613
		Vjil Conslti [Sh]	0.107
		Cash- in – hand	0.071
		HSBC Bank	0.100
		The Vysya Bank Limited N. P.	0.367
Total	75.557	Total	75.557

MR. ABHISHEK B. JAIN

INCOME AND EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31.03.2007

Particulars	Amount	Particulars	Amount
To Bank Commission	0.001	By Dividend	0.005
To Share Expenses	0.004	By Interest From Bank and FDR	0.013
	0	By Interest From PPF	0.009
To balance trf. To B/S	0.420	By Salary From Flawless Diamonds	0.039
		By Salary From Manoj Diamonds	0.040
		By Salary From Megha Jewels	0.035
		By Short Term Capital Gain	0.284
Total	0.425	Total	0.425

CAPITAL ACCOUNT FOR THE YEAR ENDED 31.03.2007

Particulars	Amount	Particulars	Amount
To Advance Tax	0.005	By Opening Balance	17.434
To Birla Sun Life Insurance	0.056	By Income Tax Refund	0.013
To Drawings	0.036	By Balance trf. To From Income and Expenses A/c	0.419
To LIP	0.083
To LIP	0.001
To Wealth Tax	0.013
To Balance trf. To B/S	17.672
Total	17.866	Total	17.866

BALANCE SHEET AS ON 31.03.2007

Particulars	Amount	Particulars	Amount
Capital Account	17.672	Diamond and Gold Jewellery	1.878
Harsh Diamonds	5.701	Flat	0.230
		Asha Cine Equipments Limited [Sh]	0.068
		Eminent Build Private Limited [Sh]	0.006
		Goodwill Traders Private Limited [Sh]	0.090
		IVL [Insurance]	0.100
		Jalak Impex Private Limited [Share]	0.105
		Karat Diamond Private Limited [Sh]	0.100
		Post Office R. D.	0.450
		PPF	0.140
		Sanaudit Synt. Private Limited [Sh]	0.015
		Flawless Diamond India Limited	20.000
		Gandhinagar Court Deposit	0.050
		Cash – in – Hand	0.037
		The Vysya Bank [Current A/c]	0.069
		The Vysya Bank Limited N. P.	0.035
Total	23.373	Total	23.373

MS. SUNITA K. JAIN

INCOME AND EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31.03.2007

Particulars	Amount	Particulars	Amount
To Bank Charges	0.004	By Interest on PPF	0.019
	0	By Interest from Bank and FDR	0.002
	0	By Dividend	0.197
To balance trf. To B/S	3.349	By Profit from Gopuram Developers	0.016
		By Short Term Capital Gain on Shares	3.119
Total	3.353	Total	3.353

CAPITAL ACCOUNT FOR THE YEAR ENDED 31.03.2007

Particulars	Amount	Particulars	Amount
To Advance Tax	0.020	By Opening Balance	48.700
To Drawings	0.040
To LIP	0.130	By Balance trf. To From Income and Expenses A/c	3.349
To Wealth Tax	0.035
To PPF [Harsh K. Jain]	0.015
To Digital Signature	0.002
To Stamp Duty	0.014
	0
To Balance trf. To B/S	51.793
Total	52.049	Total	52.049

BALANCE SHEET AS ON 31.03.2007

Particulars	Amount	Particulars	Amount
Capital Account	51.792	Flat	0.622
		Jewellery	2.521
		Investment in Shares	16.622
		Sanyati Exports	26.524
		P. G. Conductor	0.002
		PPF	0.287
		Cash in Hand	0.019
		Ing Vysya Bank Limited [Current]	0.010
		Ing Vysya Bank Limited [Saving]	0.003
		Goodwill Theaters Private Limited	1.425
		Gopuram Developers [P’ship Firm]	0.008
		Guru Share Brokers Private Limited	3.749
Total	51.792	Total	51.792

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.42.94
UK Pound	1	Rs.84.52
Euro	1	Rs.66.73

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	7
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	8
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	7
--LEVERAGE	1~10	7
--RESERVES	1~10	7
--CREDIT LINES	1~10	7
--MARGINS	-5~5	-
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		63

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

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

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

RATING 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