MIRA INFORM REPORT

Report Date :

12.05.2008

IDENTIFICATION DETAILS

Name :	PARAMOUNT MINERALS AND CHEMICALS LIMITED
Registered Office :	33, Old Hanuman Lane, 1^st Cross Lane, Kalbadevi Road, Mumbai-400002, Maharashtra
Country :	India
Financials (as on) :	31.03.2007
Date of Incorporation :	14.02.1975
Com. Reg. No.:	18144
CIN No.: [Company Identification No.]	U24110MH1975PLC018144
TAN No.: [Tax Deduction & Collection Account No.]	MUMP16380A
PAN No.: [Permanent Account No.]	AAACP2721Q
Legal Form :	A closely held public limited liability company.
Line of Business :	Manufacturer of Spray Dried Optical Brightening Agents [OBAs] and Dye Intermediates.

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 320000
Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject is a well established company having satisfactory track. Trade relations are fair. General financial position is satisfactory. Payments are reported as slow but correct. The company can be considered normal for business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	33, Old Hanuman Lane, 1^st Cross Lane, Kalbadevi Road, Mumbai-400002, Maharashtra, India
Tel. No.:	91-22-40982500 / 22408562
Fax No.:	91-22-40982590 / 22414108 / 22403690
E-Mail :	info@pmclindia.com whitener@vsnl.com
Website :	http://www.pmclindia.com
Factory :	Plot No. C/6, MIDC Area, Chemical Zone, Ambernath, Maharashtra, India
Tel. No.:	91-22-22682190

DIRECTORS

Name :	Mr. Prabhas J. Sanghai
Designation :	Director
Address :	211, Neelambar, 37-A, Peddar Road, Mumbai-400026, Maharashtra, India
Date of Birth/Age :	14^th November, 1961
Date of Appointment :	19^th November, 1988
Name :	Mr. Brijkishore Tambi
Designation :	Director
Address :	205, Satyanarayan Bhuvan, R. G. Thandani Marg, Worli, Mumbai-400018, Maharashtra, India
Date of Birth/Age :	8^th October, 1942
Date of Appointment :	19^th November, 1988
Name :	Mr. Rahul Sanghai
Designation :	Director
Address :	211, Neelamber, 37A, Peddar Road, Mumbai-400026s, Maharashtra, India
Date of Birth/Age :	26^th November, 1973
Date of Appointment :	1^st January, 1997
Name :	Mr. Dharaprasad Ramrikhdas Poddar
Designation :	Director
Address :	85, Mount Unique, Peddar Road, Mumbai-400026, Maharashtra, India
Date of Birth/Age :	2^nd September, 1926
Date of Appointment :	25^th January, 2003

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 18.07.2005

Names of Shareholders	No. of Shares
S. P. Investrade India Limited	8000
Poddar Brothers Investment Private Limited	21220
Davesh P. Sanghai	8367
Anita Devi P Sanghai	5366
Viraj P. Sanghai	8367
Rahul Kumar N. Sanghai	12000
Nikhil P. Sanghai	5525
Udit P. Sanghai	12000
Punkaj Kumar J. Sanghai	12000
Sanchna Trading and Finance Limited	12000
Parul P. Sanghai	5000
Ushadevi N. Sanghai	5000
Manjula Devi P. Sanghai	4000
Pankajkumar Sanghai HUF	5100
Vasudha R. Sanghai	4000

AS ON 30.09.2007

Equity Share Breakup	Percentage of Holding
Category
Bodies corporate	18.65
Directors or relatives of directors	43.13
Other top fifty shareholders	38.22
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer of Spray Dried Optical Brightening Agents [OBAs] and Dye Intermediates.

GENERAL INFORMATION

No. of Employees :	About 100
Bankers :	Central Bank of India, Corporate Banking Finance Branch, M. G. Road, Fort, Mumbai-400023, Maharashtra, India The Zoroastrian Co-operative Bank Limited, Hanuman Circle, Fort, Mumbai, Maharashtra, India Export Import Bank of India, Central One Building, Floor 21, World Trade Centre Complex, Cuffe Parade, Mumbai – 400005, Maharashtra, India

Banking Relations :	Satisfactory
Auditors :
Name :	A. K. Sonthalia and Company Chartered Accountants
Address :	384 M, Kalbadevi Road, Mumbai – 400002, Maharashtra, India

CAPITAL STRUCTURE

AS ON 30.09.2007

Authorised Capital :

No. of Shares	Type	Value	Amount
221000	Equity Shares	Rs. 100/- each	Rs.22.100 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
221000	Equity Shares	Rs. 100/- each	Rs.22.100 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		22.100	22.100	22.100
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		57.540	28.611	20.371
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		79.640	50.711	42.471
LOAN FUNDS
1] Secured Loans		120.528	118.243	97.198
2] Unsecured Loans		79.065	92.529	94.368
TOTAL BORROWING		199.593	210.772	191.566
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		279.233	261.483	234.037
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		207.146	198.294	176.187
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		0.100	0.100	0.100
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	51.666	30.855	26.629
	Sundry Debtors	54.718	38.030	30.431
	Cash & Bank Balances	3.580	6.837	7.231
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	15.013	16.343	11.056
Total Current Assets		124.977	92.065	75.347
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	46.652	25.731	15.420
	Provisions	6.338	3.245	2.177
Total Current Liabilities		52.990	28.976	17.597
Net Current Assets		177.987	63.089	57.750
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		385.233	261.483	234.037

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
Sales Turnover		477.309	366.166	301.268
Other Income		1.340	1.406	3.020
Total Income		478.649	367.572	304.288
Profit/(Loss) Before Tax		33.571	9.815	8.589
Provision for Taxation		4.353	1.315	0.670
Profit/(Loss) After Tax		29.218	8.500	7.919
Expenditures :
	Raw Material Consumed	238.473	188.036	141.923
	Consumption of stores and spares parts	16.049	11.414	9.970
	Increase/(Decrease) in Finished Goods	1.238	[1.139]	8.751
	Salaries, Wages, Bonus, etc.	10.021	5.169	4.640
	Payment to Auditors	0.072	0.095	0.076
	Interest	19.490	19.368	18.417
	Insurance Expenses	2.675	2.898	1.968
	Power & Fuel	32.154	35.194	25.682
	Depreciation & Amortization	16.706	13.992	12.194
	Other Expenditure	108.201	82.730	72.079
Total Expenditure		445.079	357.757	295.700

KEY RATIOS

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
PAT / Total Income	(%)	6.10	2.31	2.60
Net Profit Margin (PBT/Sales)	(%)	7.03	2.68	2.85
Return on Total Assets (PBT/Total Assets}	(%)	10.11	3.38	3.41
Return on Investment (ROI) (PBT/Networth)		0.42	0.19	0.20
Debt Equity Ratio (Total Liability/Networth)		3.17	4.73	4.92
Current Ratio (Current Asset/Current Liability)		2.36	3.18	4.28

LOCAL AGENCY FURTHER INFORMATION

Bankers Charges Report as per Registry

Name of the company

PARAMOUNT MINERALS AND CHEMICALS LIMITED

Presented By

CENTRAL BANK OF INDIA AND PARAMOUNT MINERALS AND CHEMICALS LIMITED

1) Date and description of instrument creating the change

Dated 14^th June 1990

Agreement of Hypothecation

2) Amount secured by the charge/amount owing on the securities of charge

Rs. 1.100 Millions

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

All tangible movable property such as products, stock-in-trade and goods of the Borrowing which now or hereafter from time to time during the security shall brought in, stored or be in or about the premises, warehouses or where else or godowns of the Borrowers at C-6, MIDC Area, Chemicals Zone, Aambernath.

4) Gist of the terms and conditions and extent and operation of the charge.

Hypothecation of Assets described in Co. 3 to secure a Cash Credit of Rs. 1.100 Millions repayable on demand at a compound rate of interest at 16.5 % p.a.

5) Name and Address and description of the person entitled to the charge.

Central Bank of India, Corporate Banking Finance Branch, M. G. Road, Fort, Mumbai-400023, Maharashtra, India

6) Date and brief description of instrument modifying the charge

Dated 23^rd July 2005

No instrument but equitable mortgage created by way of deposit of title deeds in respect company’s immovable properties as security.

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.

Past Modifications :

The original charge created on 14.06.1998 for Rs. 1.100 Millions was modified on 16.04.1993 and 12.02.1999 for Rs. 3.300 Millions and Rs. 32.000 Millions respectively.

Further modified on 17.04.2001 for Rs. 79.900 Millions

Present Modification :

The company gave and accorded its consent to the Central Bank of India to retain and continue to hold the title deeds in respect of all that piece or parcel of land known as Plot No. C – 6 in the Ambernath Industrial Area, within the Village limits of Kansai Taluka and Registration Sub-District Ulhasnagar District and Registration District Than containing by admeasurements 6348 sq. mtrs. With building and structures and fixed plant and machinery thereon both present and future, as security for following advances :

Rs. In Millions

Central Bank of India :
Fund Based	50.000
Working Capital Limits including DPG
Non Fund Based	25.000
LC [DA/DP] Bank Guarantee
Total	75.000
Exim Bank
Term Loan	40.000
Term Loan [One Million US $]	44.000
PCFC[0.45 Million US $]	19.800
Total	103.800

Together with interest, costs, damages, liquidated damages and all the amounts payable by the Company’s Accounts with the Bank.

This form is for	Modification of charge
Charge identification number of the modified	90187100
Corporate identity number of the company	U24110MH1975PLC018144
Name of the company	PARAMOUNT MINERALS AND CHEMICALS LIMITED
Address of the registered office or of the principal place of business in India of the company	33, Old Hanuman Lane, 1^st Cross Lane, 2^nd Floor, Kalbadevi Road, Mumbai – 400002, Maharashtra, India
Type of charge	Book Debts Movable Property Floating Charge
Particular of charge holder	Export Import Bank of India, Central One Building, Floor 21, World Trade Centre Complex, Cuffe Parade, Mumbai – 400005, Maharashtra, India agrigroup@eximbankindia.in
Nature of description of the instrument creating or modifying the charge	Second supplemental deed of hypothecation dated 24.08.2007 executed by Paramount Minerals and Chemicals Limited
Date of instrument Creating the charge	24.08.2007
Amount secured by the charge	Rs. 43.000 Millions
Brief particulars of the principal terms an conditions and extent and operation of the charge	Rate of Interest 125 Basis points above Libor [ as defined in the principal dollar loan agreement dated 15.10.2004 executed between the borrower and Exim Bank] inclusive of withholding Tax, payable with quarterly rests. Terms of Repayment Each advance relating to Preshipment shall be repaid by the borrower within 180 days from the date such advance or out of relative export proceeds or equiv advance from post shipment credit whichever is earlier. Each advance relating to postshipment credit shall be repaid by the borrower within 180 days from the date of such advance or out of relative export proceeds, whichever is earlier. Margin 15 % Extent and Operation of the charge The charge created by the borrower shall operate as a continuing security by way of a first pari passu charge over the borrower’s movable fixed assets and current assets including receivables and immovable assets until the dollar loan upto the increased revolving limit of US $ 1 MN shall be repaid by the borrower the Exim Bank.
Short particulars of the property charged	Book Debts, Receivables, Outstanding Moneys, Claims, Demands, Bills, Contracts, Engagements and securities. Stocks of raw materials, finished and semi finished goods, goods in process, and consumable stores. Movable plant and machinery, equipment, appliances, furniture, vehicles, machinery spares and stores, tools and accessories. Related moveable in transit or delivery.
Date of latest modification prior to the present modification	18.05.2006

FIXED ASSETS

• Leasehold Land
• Factory Building
• Plant and Machinery
• Tanks
• Lab Equipments
• Furniture and Fixtures
• Motor Car
• Office Equipments
• Computer
• Peripherals

AS PER WEBSITE

PROFILE

Paramount Minerals And Chemicals Limited belonging to the Rajkamal Group has been manufacturing Optical Brighteners for close to two decades now and has played a pioneering role in developing a comprehensive range of products encompassing the entire Optical Brightener needs of the Detergent, Paper and Textile Industries. Having made a humble beginning they have made several strides since then and are happy to have been serving their global customers for over a decade.

Their project for upgradation of manufacturing technology and increasing their production capacity has recently been completed with a significant capital investment running in to millions of US dollars. This has further enhanced their ability to meet the requirements of their customers to their optimum satisfaction with a particular emphasis on stringent quality standards. Their plant has been designed to give them the flexibility to rapidly expand the production capacity further.

Their intensified marketing efforts have been very successful and their products are now marketed to Multinational Detergent producers, Paper mills and Textile industries globally.

With the commissioning of their DASDA (a vital input in the manufacture of Optical Brighteners) plant, the policy of having their own manufacturing facilities for their major Raw Material have now been adopted and implemented.

Their ultimate commitment to consistently provide their customers with world quality products, and in view of the changing global quality scenario, the Company has successfully adopted the ISO 9001 : 2000 Quality Management System. Stressing on continuous Research and Development program, they have been at the forefront of developing new products of high light fastness and best quality to fulfill the growing needs of their customers coupled with extremely competitive prices

Their clientele boasts of leading multinational and national giants of supreme repute. It is their constant endeavor to offer their valued customers qualitative products at the most competitive prices, and to be constantly available through their Agents and Associates worldwide. They thank their valued customers for their trust and support over the decade, which has helped them to grow with them. Together they are confident of reaching the top echelons of the world.

ACTIVITIES

Paramount Minerals and Chemicals Limited manufactures and markets in the Domestic and International markets - Optical Brightening Agents.

The Parawhite range of Optical Brighteners are largely used in the three industrial segments viz.' Textile, Paper and Detergents while DASDA is used in Dyestuff manufacturing.

Their manufacturing plant is located in the Chemical Zone of the Maharashtra Industrial Development Corporation in Ambarnath, which is one of the largest and rapidly growing Industrial Zones of India. The plant lies in close proximity to the Mumbai Sea Port as well as the International airport ensuring that the finished goods are shipped promptly once they leave their plant.

In August 2004 their manufacturing capacity for Optical Brightening Agents (OBA) has increased from 6,000 Metric Tons to 9,000 Metric Tons and 600 Metric Tons for DASDA per annum. There is good potential to increase the production capacity to 24,000 Metric Tons and 1,500 Metric Tons of OBA and DASDA Plants respectively. Plans are also underway to enhance the product range by manufacturing other Dye Intermediate like Metanilic Acid to meet the growing demand for their quality products.

Their group encompasses a wide spectrum of manufacturing activities from spinning of yarn, processing of fabrics, manufacturing ready made garments and suitings and shirtings. The products from there activities are also being exported to most of the countries in Europe as well as the U.S. and Gulf.

PRODUCTS

Paramount Minerals and Chemicals Limited manufactures a wide range of Low, Medium and High affinity Stilbene based Optical Brightening Agents for the Cotton, Textile, Paper and Detergent Industries. Their products are available in both the powder and liquid forms. They also manufacture Dye Intermediates like Di-amino Stilbene Di-Sulphonic Acid (DASDA), a vital input to production of OBA's

Moreover, for companies having processing facilities they can also offer concentrated crude powders in the free acid form for some of their products which can be neutralised in to liquid by simple neutralisation procedure laid down by us. This facilitates savings in terms of freight costs.

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.41.38
UK Pound	1	Rs.63.89
Euro	1	Rs.80.76

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	5
--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	YES
TOTAL		49

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