MIRA INFORM REPORT

Report Date :

1.11.2008

IDENTIFICATION DETAILS

Name :	MUKAND LIMITED
Registered Office :	Bajaj Bhavan, Jamnalal Bajaj Marg, 226, Nariman Point, Mumbai – 400 021, Maharashtra, India.
Country :	India
Financials (as on) :	31.03.2008
Date of Incorporation :	25.12.1937
Com. Reg. No.:	11-2736
CIN No.: [Company Identification No.]	L99999MH1937PLC002726
TAN No.: [Tax Deduction & Collection Account No.]	MUMM19254E
PAN No.: [Permanent Account No.]	AAACM5008R
Legal Form :	It is a Public Limited Liability Company. The company's shares are listed on the Stock Exchanges.
Line of Business :	Manufacturing, Marketing and Exporting of iron and steel products

RATING & COMMENTS

MIRA’s Rating :

Ba

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

Maximum Credit Limit :	USD 38706500
Status :	Excellent
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well – established company having satisfactory track. Trade relations are fair. Financial position is satisfactory. Payments are usually correct and as per commitments. The company is doing well. It can be considered good for any normal business dealings at usual trade terms and conditions. The company can be regarded as a promising business partner in a medium to long – run.

LOCATIONS

Registered Office :	Bajaj Bhavan, Jamnalal Bajaj Marg, 226, Nariman Point, Mumbai – 400 021, Maharashtra, India.
Tel. No.:	91-22-22021060 / 2281 / 6524 / 3327 / 1025
Fax No.:	91-22-22021174
E-Mail :	mukandop@bom3.vsnl.net.in info@mukand.com co.secretary@mukand.com kjmallya@mukand.com
Website :	http://www.mukand.com
Corporate Office :	Bajaj Bhavan, Jamnalal Bajaj Marg, 226, Nariman Point, Mumbai -400 021, Maharashtra
Tel. No.:	91-22-22021060 / 2281 / 6524 / 3327 / 1025
Fax No.:	91-22-22021174
Factory 1 :	Ø Kurla, Mumbai - 400 070, Maharashtra. Ø Thane-Belapur Road, Dighe, P. O. Kalwe, District Thane - 400 605, Maharashtra. Tel. No. 91-22-25347373 / 25348181 Fax No. 91-22-2534 0291 E-Mail mukandop@bom3.vsnl.net.in Ginigera, Karnataka - 583 228.
Branches :	Located At : Kolkata, Delhi, Chennai, Bangalore and Vishakhapatnam.
Email :	Co.secretary@mukund.com
Website:	www.mukund.com

DIRECTORS

Name :	Mr. Rahul Bajaj
Designation :	Chairman
Name :	Mr. D. S. Mulla
Designation :	Director
Name :	Mr. Dhirajlal S. Mehta
Designation :	Director
Name :	Mr. N. P. Jain
Designation :	Director (IFS - Retd.)
Name :	Mr. Narendra J. Shah
Designation :	Director
Name :	Mr. P. Murari
Designation :	Director - IAS (Retd.) Nominee of ICICI
Name :	Mr. Shishir Bajaj
Designation :	Director
Name :	Mr. N.C. Sharma
Designation :	Director
Name :	Mr. Niraj Bajaj
Designation :	Managing Director
Date of Birth/Age :	46 years
Qualification :	B.Com., M.B.A. (Harvard Business School)
Experience :	20 years
Date of Appointment :	03.12.1990
Previous Employment:	Director (Com), Steel Authority of India Limited
Name :	Mr. Rajesh V. Shah
Designation :	Managing Director
Date of Birth/Age :	49 years
Qualification :	M.A. (Cambridge), M.B.A. (California), P. M. D. (Harvard Business School)
Experience :	25 years
Date of Appointment :	11.06.1977
Previous Employment:	Director - Virani Fasteners & Bolts Private Limited (1 year)
Name:	Mr. I. M. D’Costa
Designation:	Chief Executive
Name:	Mr. C.H.Sharma
Designation:	Chief of Technical Services
Name:	Mr. A.M.Kulkarni
Designation:	Chief of Maketing, Stainless Steel
Name:	Mr. Sidharth Shah
Designation:	Chief of Materials Management
Name:	Mr. Amit Ganguly
Designation:	Chief of R&D and TQM
Name:	Mr. N C Sharma
Designation:	Director
Name:	Mr. T Chattopadhyay
Designation:	Director

KEY EXECUTIVES

Name :	Mr. Suketu V. Shah
Designation :	President
Name :	Mr. Vinod S. Shah
Designation :	Joint President
Name :	Mr. P. C. Chhajlani
Designation :	Secretary
Name :	Mr. S. B. Jhaveri
Designation :	Vice Presidents – Finance
Name :	Lt. Gen. V. M. Patil
Designation :	Vice Presidents (Retd.) - Administration and Services
Name :	Mr. Rohit M. Bhatt
Designation :	General Manager - Finance & Taxation
Name :	Mr. I. M. D'Costa
Designation :	Vice Presidents - Steel Plant
Name :	Mr. C. H. Sharma
Designation :	Chief of Technical Services
Name :	Mr. A. M. Kulkarni
Designation :	Chief of Marketing, Stainless Steel
Name :	Mr. Sidharth Shah
Designation :	Chief of Material Management
Name :	V. M. Mashruwala
Designation :	Chief of Marketing – Special & Alloy Steels
Name :	Dr. Amit Ganguly
Designation :	Chief of R & D TQM
Name :	Mr. R. Jagannathan
Designation :	General Manager
Name :	Mr. S. K, Bansal
Designation :	Chief Executive
Name :	Mr. R. Sankaran
Designation :	General Manager
Name:	Mr. P.C.Chhajlani
Designation:	Vice President & Company Sectary
CORPORATE:	Rajesh V. Shah Managing Director Niraj Bajaj Managing Director Suketu V. Shah President Vinod S. Shah Advisor (Special Projects) S. B. Jhaveri Financial Advisor and Chief of Accounts Lt. Gen. V.M. Patil, (Retd.) Vice President (Administration & Services) P. C. Chhajlani Vice President (Secretarial & Legal) Rohit M. Bhatt Chief of Finance
STEEL DIVISION:	I. M. D'Costa Chief Executive C. H. Sharma Chief of Technical Services A. M. Kulkarni Chief of Marketing, Stainless Steel Sidharth Shah Chief of Materials Management SECRETARY: V. M. Mashruwala Chief of Marketing (Special & Alloy Steels) P. C. Chhajlani Dr. Amit Ganguly Chief of R&D & TQM
INDUSTRIAL MACHINERY DIVISION:	R. Jagannathan Chief Executive
ROAD CONSTRUCTION DIVISION:	S. K. Bansal Chief Executive R. Sankaran Chief Co-orcRnator

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 30.06.2008

Names of Shareholders	No. of Shares	Percentage of Holding
INDIAN
Individual/ HUF	9425560	12.89
Bodies Corporate	27722666	37.92
PUBLIC SHAREHOLDING
Institution
Mutual Funds/ UTI	2801224	3.83
Financial Institutions/ Banks	255062	0.35
Insurance Companies	7604184	10.40
Foreign Institutional Investor	5652410	7.73
Non- institutions
Bodies Corporate	6177894	8.45
Nominal share capital up to Rs.0.100 Millions	8502718	11.63
Nominal share capital up to Rs.0.100 Millions	4717857	6.45
Any other (clearing member)	94002	0.13
Any other (NRIs)	160552	0.22
TOTAL	69475694	100.00

PROMOTER AND PROMOTER GROUP

Names of Shareholders	No. of Shares	Percentage of Holding
Shri Rahul Bajaj	166792	0.23
Shri Niraj Bajaj	98200	0.13
Shri Rajesh V Shah	3648065	4.99
Shri Suketu V Shah	3647668	4.99
Smt. Savitridevi Bajaj	6018	0.01
Shri. Shishir Bajaj	42037	0.06
Shri. Shekhar Bajaj	128.911	0.18
Shri Madhur Bajaj	313.070	0.43
Smt. Ruparani Bajaj	100200	0.14
Smt. Minakshi Bajaj	4680	0.01
Shri. Apoorva Bajaj	4000	0.01
Shri. Anant Bajaj	9000	0.01
Smt. Suman Jain	1520	0.00
Smt. Sunaina Kejriwal	100	0.00
Shri. Viren J Shah	18352	0.03
Shri. Narendrakumar J Shah	99605	0.14
Kum Amita Virendrakumar Shah	3875	0.01
Smt. Anjana K Munsif	12282	0.02
Smt. Jyoti Shah	18117	0.02
Smt. Bansari Rajesh Shah	551186	0.75
Smt. Czaee Sukumar Shah	551882	0.75
Bachhraj and Company Private Limited	1360471	1.86
Jeewan Limited	3688336	5.04
Jamnalal Sons Private Limited	12981061	17.75
Bajaj Holdings and Investment limited	4012030	5.49
Niraj Holding Private Limited	500	0.000
Bachhraj Factories Limited	689084	0.94
Bajaj Sevashram Limited	80	0.000
Bajaj Hindustan Limited	9750	0.01
Baroda Industries Private Limited	956349	1.31
Akhil Investment and Trader Private Limited	260	0.00
Sidya Investments Limited	160000	0.22
Conquest Investments and Finance Limited	288320	0.39
Catalyst Finance Limited	647160	0.89
Econium Investments and Finance Limited	391760	0.54
Fusion Investments and Financial Services Limited	825680	1.13
Lineage Investments Limited	664000	0.91
Primus Investment and Finance Limited	366365	0.50
Mukund Engineers Limited	681200	0.93
Valiant Investments and Traders Private Limited	260	0.00
Total	37148226	50.81

PUBLIC AND HOLDING OF MORE THEN 1% OF TOTAL NUMBER OF SHARE

Names of Shareholders	No. of Shares	Percentage of Holding
Life Insurance Corporation of India	7228076	9.89
Vinamran Universal Traders Private Limited	`2994909	4.10
ICICI Prudential Mutual Fund	2.795197	3.82
Goldman Sachs Investments (Mauritius) I Limited	1691670	2.31
Swiss Finance Corporation (Marutius) I Limited	1360659	1.86
Clsa (Marutius) Limited	1027279	1.41
JM Financial Service Private Limited	1000100	1.37
Union Investment : unxembourg S A A/c	800000	1.09
Bajaj Auto Employees Welfare Funds	784682	1.07
Total	19682572	26.92

BUSINESS DETAILS

Line of Business :

Manufacturing, Marketing and Exporting of iron and steel products

Products :

Product Description	Items Code No. (ITC Code)
Bars and rods, Hot rolled in irregularly wound coils of stainless steel.	7221.00
Bars and rods, Hot rolled in irregularly wound coils of alloy steel.	7227.00
Bars and Rods of alloy Steel	7228.00

PRODUCTION STATUS

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
Bars, Rods and Sections	Tonnes		335628	267353
E.O.T. Cranes, Portal Cranes.Metallurgical Equipment, Machinery for Crushers.Grinders, Processing and Handling of Bulk Material.	Tonnes		9410	7420
Castings of Alloy & Other Steel.	Tonnes		2400	1358
Electrical Energy	Tonnes		22.10 M.W.	93.98
Semi Finished Billets & Blooms	Tonnes		632500	431355

GENERAL INFORMATION

Suppliers :

· Amit Refractories Private Limited

· A-One Chemicals

· B.D. K. Engineers & Fabricators

· Chandrika Engineering Works

· DB Power Electronics Private Limited

· Excel Engfab (India) Private Limited

· Sansid Polbro Chemicals (India) Private Limited

· Satish Engineering Company Private Limited

· Ferro Insulation Private Limited

· Salzgitter Hydraulics Private Limited

· TIS Thermo Instruments

· Tuff Tools

· JSL Refractories Limited

· Maxworth Industries

· Moulds & Dies Private Limited

· Annapurna Lime Industries

Customers :

· Steel Authority of India Limited

· Bharat Heavy Electricals Limited

· Major Electricity Boards

· Nuclear Ppwer Corporation

· National Thermal Power Corporation Limited

· National Hydro Power Corporation Limited

· Indian Space Research Organisation

· Defence Research and Dvelopment Organisation

· Directorate General of Naval Projects

· Major Ports - KPT, BPT, VPT, MPT

· Ship Building Center

· Indian Navy

· Mazgaon Docks Limited

No. of Employees :

4,500

Bankers :

· Allahabad Bank

· ABN Amro Bank N.V.

· Bank of Baroda, Khand Bazar

Tel. No. 91-22-23422635

· Dena Bank

· HDFC Bank Limited

· Indian Overseas Bank

· ICICI Bank Limited

· Punjab National Bank

· State Bank of India

· Axis Bank Limited

Facilities :

Particulars	As on 31.03.2006 Rs in millions
Secured Loans
a) Debentures	0.847
b) Long Term
- Financial Institutions	2727.421
- Banks	4833.060
- A Company	293.071
- Housing Development Finance Corporation Limited	1.184
d) working capital loans from banks	393.493
Unsecured Loans
Fixed Deposits	286.207
Inter Corporation Deposits	162.500
Loan from Housing Development Finance Corporation Limited	1650.000
Sales Tax Deferment Loan	23.183
Hire Purchase Finance from Companies	49.318

Banking Relations :	Unknown
Auditors :	Dalal &Shah Chartered Accountants
Associates:	· Mukand Engineers Limited, Bajaj Bhawan (Third floor) Jamnalal Bajaj Marg, 226, Nariman Point, Mumbai 400 021. Tel. 91-22-2202 1060/1025 Fax: 91-22-2202 1174 · Mukand Vijayanagar Steel Limited · Mukand Industrial Machinery Limited · Mukand Soviet Engineering Limited · Bombay Forgings Limited · Stainless India Limited · Hospet Steels Limited Hospet Road, Ginigera, Dist.:Koppal Karnataka – 583 228 Tel.: 91-8539-86603/06 Fax: 91-8539- 286611 / 286662 · Kalyani Mukand Limited · Lineage Investments Limited · Catalyst Finance Limited · Econium Investments & Finance Limited · Fusion Investments & Financial Services Limited · Primus Investments & Finance Limited · Conquest Investments & Finance Limited · Jeewan Limited · Wolff Pipelines Limited · Wye Limited
Subsidiaries:	· Mukand Global Finance Limited · Mukand International Limited P.O. Box.17138 Jebel Ali, Dubai , United Arab Emirates Tel.: 971-4-883 8485 Fax: 971-4-883 8685 Email: Mukand@emirates.net.ae · Vidyavihar Containers Limited (Formerly Known as Nathani Steel Limited)
Parent company:	Mukand Holdings & Finance Limited
Memberships:	Confederation of Indian Industry

CAPITAL STRUCTURE

AS ON 31.03.2007

Authorised Capital :

No. of Shares	Type	Value	Amount
118000000	Equity Shares	Rs. 10/- each	Rs. 1180.000 millions
7000000	Preference Shares	Rs. 10/- each	Rs. 70.000 millions
	Total		Rs. 1250.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
5626320	0.01% Cumulative Redeemable Preference Shares	Rs. 10/- each	Rs. 56.263 millions
73159805	Equity Shares	Rs. 10/- each	Rs. 731.599 millions
	Total		Rs. 787.862 millions
	Subscribed & Paid-up Capital
5626320	0.01% Cumulative Redeemable Preference Shares	Rs. 10/- each	Rs. 56.263 millions
73114129	Equity Shares	Rs. 10/- each	Rs. 731.141 millions
	Add : Forfeited Shares	Rs. 10/- each	Rs. 0.116 million
			Rs. 787.520 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		787.500	787.500	787.500
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		6953.800	6528.900	5681.800
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		7741.300	7316.400	6469.300
LOAN FUNDS
1] Secured Loans		10987.500	9739.300	9095.900
2] Unsecured Loans		1958.900	805.300	2171.200
TOTAL BORROWING		12946.400	10544.600	11267.100
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		20687.700	17861.000	17736.400
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		6628.800	6519.700	6709.000
Capital work-in-progress		2421.100	568.900	247.600
INVESTMENT		1116.000	965.800	953.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	6960.800	4966.500	3865.300
	Sundry Debtors	5741.500	5420.500	4942.600
	Cash & Bank Balances	1392.200	995.400	1332.300
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	4868.500	4826.600	5117.700
Total Current Assets		18963.000	16209.000	15257.900
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	7757.700	5920.800	5308.700
	Provisions	739.600	584.300	323.400
Total Current Liabilities		8497.300	6505.100	5632.100
Net Current Assets		10465.700	9703.900	9625.800
MISCELLANEOUS EXPENSES		56.100	102.700	201.000
TOTAL		20687.700	17861.000	17736.400

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2008	31.03.2007	31.03.2006
Sales Turnover		22012.500	20816.300	18125.600
Other Income		748.800	676.200	1779.000
Total Income		22761.300	21492.500	19904.600
Profit/(Loss) Before Tax		828.400	1146.700	1219.300
Provision for Taxation		306.000	214.000	112.000
Profit/(Loss) After Tax		522.400	932.700	1107.300
Expenditures :
	Manufacturing Expenses	5437.000	5488.200	4586.200
	Raw Material Consumed	9955.700	7871.600	6708.100
	Excise Duty	2819.100	2702.800	2370.900
	Increase/(Decrease) in Finished Goods	(1534.900)	(873.000)	(506.400)
	Interest	1683.600	1420.000	1444.600
	Power & Fuel	1277.000	1280.300	1159.300
	Depreciation & Amortization	579.900	566.700	579.400
	Other Expenditure	1715.500	1889.200	2343.200
Total Expenditure		21932.900	20345.800	18685.300

QUARTERLY

PARTICULARS	30.06.2008 1^st Quarter	30.09.2008 2^nd Quarter
Sales Turnover	5593.200	5827.500
Other Income	31.300	121.900
Total Income	5624.500	5949.400
Total Expenditure	5006.400	5455.900
Operating Profit	618.100	493.500
Interest	322.400	347.800
Gross Profit	295.700	145.700
Depreciation	141.100	148.100
Tax	2.900	2.600
Reported PAT	111.600	14.400

KEY RATIOS

PARTICULARS	31.03.2008	31.03.2007	31.03.2006
Debt Equity Ratio	1.88	1.94	2.70
Long Term Debt Equity Ratio	1.44	1.77	2.56
Current Ratio	1.72	2.25	2.21
TURNOVER RATIOS
Fixed Assets	2.09	2.07	1.83
Inventory	3.69	4.71	5.16
Debtors	3.94	4.02	3.86
Interest Cover Ratio	1.49	1.81	1.59
Operating Profit Margin (%)	14.05	15.05	15.84
Profit Before Interest and Tax Margin (%)	11.41	12.33	12.64
Cash Profit Margin (%)	5.01	7.20	7.42
Adjusted Net Profit Margin (%)	2.37	4.48	4.23
Return on Capital Employed (%)	14.01	15.67	15.07
Return on Net Worth(%)	8.42	16.74	17.92

LOCAL AGENCY FURTHER INFORMATION

HISTORY

Earlier known as Mukand Iron and Steel Works, Subject was incorporated in November, 1937. Founded by Lala Mukand Lal, it was later taken over by Jamanlal Bajaj and Jeewanlal Motichand Shah. It is a multi-product, multi-division company. The main divisions are the steel plant, steel foundry and real estate. The steel foundry and the stainless steel coils finishing division received certificates of approval under ISO 9002 from the Bureau Veritas Quality Internationale. 

A leading producer of stainless steel, Subject manufactures cold-headed quality steel, ball-bearing steel, carbon and alloy steel bars and wire rods, and, leaded steel bars. Its foundry produces a wide range of components from intricate tiny pieces weighing a few kilograms to large castings weighing over 80 tonnes.

As a leading special and alloy steel producer, Subject has been a pace setter for technological development in Electric Arc Furnace Steelmaking. In 1965, Subject became India's first steelmaker to install a continuous casting machine. Today, its entire steel production is through the continuous casting route.

In 1989, it set up a new company for engineering and project management services in collaboration with Dravo Wellman Company, US. The Company also issued Bonus shares in the ratio of 1:2. Beco Engineering Company was amalgamated with the Company in October 1992 in terms of the AAIFR order with effect from April 1991. 

In 2001, the company like other industries in manufacturing segment experienced liquidity crunch throughout the year resulting from excess production capacities and longer credits granted by competitors. The company has entered into co-operation agreements with JSC Centrodorstroy(CDS) a Russian based company to whom the Road construction contracts were awarded on early 2001. The total project value being Rs.5610.000 million and it involves four-laning and strengthening of the existing two-lane sections on the NH-2 in UP.

The Road Construction division has commenced execution of the four laning project in Uttar Pradesh during the year 2002-2003.The net worth of the company has eroded in excess of 50% of its peak net worth during the immediately preceding four financial years and the company has thus become Potentially Sick. On restructuring of company's debts,the revised proposal for restructuring has been finalised by ICICI Bank Limited and the same has been approved by Corporate Debt Restructuring Cell(CDR) set up RBI

POTENTIAL SICKNESS:

As at 31.03.2003, the Company became a 'Potentially Sick Industrial Company' under The Sick Industrial Companies (Special Provisions) Act, 1985, (SICA). With the reduction in unadjusted accumulated losses as at 31.03.2005, the Company now ceases to be a 'Potentially Sick Industrial Company' under SICA.

DIVIDEND: 

The Directors recommend a payment of dividend on 0.01% Cumulative Redeemable Preference Shares. In order to conserve resources that will help in reducing debt and financing capital expenditure, a modest dividend of Rupee 1/- per share on equity shares is being recommended. The dividend and tax thereon aggregate Rs.85.55 million for the year. 

OPERATIONS:

The sales and income from other operations increased to Rs.18.020 billion as against Rs. 16.730 billion in the previous year. 

Profit before Interest, Depreciation, Exceptional items, Waivers and Taxes (EBIDTA) increased to Rs. 2.490 billion as compared to Rs.1.520 billion in the previous year. The, improved market conditions and efficient operations of tare steel and industrial machinery businesses resulted in the better performance. 

The salient features of the performance of each segment and the prospects for the year in progress are discussed in the following paragraphs. 

STEEL DIVISION: 

The turnover of the division increased at Rs.19.02 billion compared to Rs.17.69 billion in the previous year. 

Value added steel and bright bars saw a surge in the sales, marking an increase of 17% over the previous year. 

The margins of the steel division were under severe pressure on account of the steep increase in the cost of major inputs such as coke, iron ore, scrap, ferro chrome, molybdenum, furnace oil, etc. 

The price of metallurgical coke marked an increase of 140% over the previous year, ferrochrome high carbon of over 200%, shredded scrap by over 50% and furnace oil by 40% during the year under review. Nickel prices softened after a record high in May 2007. 

Adapting to the changing market and to improve margins, the Company enhanced its product mix to high value items by increasing the production of bearing steel, duplex grade of stainless steel, bright bars, wires and heat treated steel. The Company progressively effected price increase in its products to mitigate the rise in input costs during the year but these could not be fully recovered from customers. 

To ensure raw material security, particularly of metallurgical coke, the Company is setting up a coke oven plant with a capacity of 120,000 tonnes per annum near its steel plant at Ginigera, Karnataka. The Company has acquired land for the project and appointed the Central Fuel Research Institute as technical advisor. 

The prices of iron ore too rose sharply in the domestic and international markets in the year under review. Although the Company has a long term exclusive agreement for raising its iron ore, the price of the iron ore is subject to periodic revisions. A claim towards the difference in price for FY 2006-07, over the contractual price, has been raised by the supplier in March 2007. The Company has been legally advised that the supplier cannot seek a price revision on an existing price contract. The issue has been referred to an arbitral~tribunal. Hence, no provision has been made in the accounts. Moreover the said supplier has also unilaterally increased the price of iron ore effective April 1, 2007. This issue too is to be settled by the above said arbitral tribunal. However, pending determination of the final price, the supplier has raised invoices at an interim, price on the marketing contractor who in turn has billed the Company at this price, and the liability is accounted accordingly.

The Company is also experiencing some constraints from the concerned authorities in the transportation of iron ore from the mines to the Ginigera, Karnataka facility. This has resulted in the Company having to procure iron ore at a higher price from the open market. 

The ongoing capital expenditure (capex) programme of the Company is progressing on schedule and will increase the Company's overall production capacity of rolled steel products by 80%. The entire capex programme at the existing facilities is underway without interrupting the production. 

The third Mini Blast Furnace (MBF) was ,commissioned in March 2008 at the Ginigera, Karnataka facility and the Steel Melt Shop has been geared to cast blooms for the additional liquid metal produced from the third MBF.

INDUSTRIAL MACHINERY DIVISION 

The division reported an increase of 23% in the divisional turnover of the Company at Rs.2.74 billion, as against Rs.2.23 billion in the previous year. The division has orders in hand aggregating to Rs. 5.8 billion at the end of the year under review. 

The division successfully exported cranes to Indonesia and Dubai and copper plant equipment to Zambia thereby expanding its markets to new geographical locations. 

The Indian economy continues to surge with investments in new process plants in the country. This has ensured a healthy order book for this division, as it is in the business of manufacturing heavy duty cranes and other equipment for process plants. 

The production of this division will further be enhanced with the completion of the capital expenditure programme. The Company has already installed additional capacity at Dighe, Thane and is now in the midst of putting up another facility at Sinnar, Nashik which together will take the  

Capacity of the division to Rs. 7 billion. Land for this facility has been allotted by MIDC and the preparatory work / detailed planning has commenced. 

ROAD CONSTRUCTION DIVISION 

The revenue from the division was lower for the year under review at Rs.584 million as compared to Rs.903 million in the previous year. As of March 31, 2008, the division completed 285 KM of two lanes of the main carriage way and 57 KM of service road which together amounts to 92% of the total business. 

Although the full financial outcome of the division's activity cannot be estimated with certainty at present, the management has provided for the losses currently expected till the close of the year keeping in mind the substantial large claims made by the Company for the incremental jobs executed, escalations and time-overruns. 

Finance:

The Company arranged from banks additional funded and non-funded working capital facilities of Rs.3.32 billion to fund the substantial increase in input costs and the changing product mix. The Company plans to reduce its long term borrowings from the funds that will be generated from operations which will accrue on the completion of the capital expenditure programme. 

Joint Venture: 

The Company set up a 50 : 50 joint venture with NV Bekaert SA, of Belgium which is the largest manufacturer of steel wires in the world. The new Company Mukand Bekaert Wire Industries Private Limited will produce stainless steel wires from a facility in Lonand, Dist. Satara, Maharashtra for which 25 acres of land has been acquired from MIDC. The new Company will commission a capacity of 6,000 tonnes per annum by the end of the year in progress. An additional capacity of 6,000 tonnes per annum shall be commissioned in FY 2009-10. Both the partners have so far subscribed Rs. 60 million each in Equity shares of this JV Company. 

At Ginigera, Karnataka, the Company contributed to the infrastructural support for five schools and a college in the villages around its facility.

It conducted free eye camps, wherein villagers from the surrounding villages participated. Support by way of a primary health centre and medical assistance were also provided. Street lights were installed and maintained in the villages around the Ginigera, Karnataka facility. An annual cricket tournament is hosted at the Company's facility for teams from the neighbouring towns of Hospet, Bellary, Koppal, Gadag and Hubli.

MANAGEMENT DISCUSSION AND ANALYSIS 

The Indian Growth Story 

The Indian economy continues to surge ahead as a result of the substantial industrial and manufacturing growth backed by sustained domestic consumption. Although the financial year 2007- 2008 experienced a slight decline in the rate at which the economy is growing, fortunately there appears to be no respite in the surge in investments. This is an indicator not only of a healthy economy but continued hope in the future potential of the country. 

In the year that has gone by, the country focused on generating knowledge, acquiring technology and establishing global benchmarks in procedures and systems that will take this growth ahead. The Company too focused on these activities to ensure that it maintained its position as the leading supplier of speciality steel long products to global brands and also remained the leading manufacturer of heavy duty cranes. 

Steel 

The steel industry witnessed a radical change in input costs in the year under review. Increase in the input costs of metallurgical coke, iron ore, scrap and other materials increased the cost of making steel substantially, during the year under review. This put tremendous pressure on steel companies who were thus forced to increase their selling price to mitigate the massive increase in their costs. Nickel was the only input that softened after a record high in May 2007, thus resulting in a decrease in the selling price of nickel-intensive stainless steel grades. 

 The Company progressively effected price increases to mitigate the rising input costs during the year under review. Raw material security is an imperative for long term sustainability. Focused efforts are therefore being made by the Company to achieve higher levels of raw material security especially of iron ore and metcoke to meet the increased needs in line with its further growth aspirations. The Company has already acquired land near its Ginigera, Karnataka facility to put up a 120,000 tonne per annurn metallurgical coke oven. The Company has appointed the Central Fuel Research Institute as the technical advisor for this project. 

 Contributing to the efforts to keep the environment pollution free, the Company plans to utilise the flue gases from the third Mini Blast Furnace at the Ginigera, Karnataka facility to generate power by setting up a 15 MW captive power plant. This will ensure continuous availability of power and reduce costs as the Company will be eligible for carbon credit 

The Company continues to further enrich and benchmark its operations and capabilities with the best in the world. The Dighe, Thane facility qualified through the first stage audits for the certification of ISO-TS-16949 standards by the global certification company - Bureau Veritas. The final audits will be held during the year in progress. The Ginigera, Karnataka facility received the TPM Excellence Award from the Japan Institute of Plant Maintenance. The re-certification audit for TS 16949:2002 atthe Ginigera, Karnataka facility has been completed and the OHSAS 18001:1999 - certification awarded during the year under report. 

Superior operations and people's capabilities are powered by technology. In the year under review, the Company acquired state of the art technology at both its facilities which will augment the manufacture of superior quality products. The Company's products have enjoyed a leadership position of quality in the markets it operates and it hopes to continue holding this position in the new globalised markets. 

Getting set to grow, the Company has undertaken a capital expenditure programme which will increase the steel making, rolling and finishing facilities at both the Dighe, Thane and Ginigera, Karnataka facilities. 

At Dighe, Thane: 

* The modernisation programme of the Wire Rod Mill (WRM) is progressing as per schedule and commercial production is expected to commence in the second quarter of the year in progress. This will result in the coil weight increasing to 1,500 kgs., as per international standards, from the present 650 kgs. The modernised mill will also have a cooling bed that will increase the range of the sections to be rolled and have the flexibility to roll in straight lengths. The overall capacity of rolling at the mills will stand increased by 120,000 tonnes per annum.

* Two state-of-the-art Bell Furnaces have commenced commercial production which will enhance the capacity of value added products. 

Various testing equipment, hot bar measuring system and other balancing equipment, etc. have been commissioned. These facilities will facilitate increase in production whilst ensuring international quality standards as per the requirements of global customers. 

Two spheroidised annealing furnaces for bars are under erection while the third shot blasting machine for coils too is under commissioning. 

At Ginigera, Karnataka: 

The third mini blast furnace of 350 cubic meter capacity was commissioned at Ginigera, Karnataka on March 29, 2008 and has stabilised in record time. 

The steel melt shop upgradation is being completed to cater to the enhanced production resulting from the installation of the third mini blast furnace. 

Modernisation of the rolling mill is also in progress and will start commercial production in the second half of the year in progress. 

The above increased facilities will be shared by the strategic alliance partners and the Company's share will be at 58.62%. 

The Company has the flexibility to constantly adapt to changes in the market by modifying its product mix. In the year under review, the Company increased its production of bearing steel and will continue in this direction in the year in progress. The Company developed a specialised grade of steel to suit the stringent requirements of the global customers for use in fuel injection pumps, common rail diesel injection pumps, etc..

The Company also successfully 

developed a duplex grade of stainless steel that is highly corrosion resistant and of higher strength. This grade will act as an import substitution product and has a potential market in oil, gas and marine applications. The Company increased its production of spring steel which can be used in applications across industries. Large size peeling, reeling and polishing machines capable of producing bright bars upto 150 mm dia. have been installed which will automatically give the Company a strong foothold in the extrusion industry for products which hitherto were imported. 

The Company continues its leadership position in the supply of steel for critical applications to global leaders in the automobile component sector while India continues to consolidate its position as the automobile hub for export of vehicles as well as components. The auto component exports industry grew at around 20% during the year under review. The demand for automobiles will go up with the reduction of Excise Duty on small cars from 14% to 12% in the recent budget. New investments of around Rs. 300 billion have been planned by leading global and Indian automobile manufacturers in India in the next three years. , 

The Company showcased its product capability and technological prowess at the 9th Auto Expo held in New Delhi from January 10 -17, 2008 and also at the world's largest wire exhibition held from March 31 - April 4, 2008 at Dusseldorf, Germany. 

Industrial Machinery Division: 

This division is a leader in the country in the design and ,manufacture of heavy duty cranes and other sophisticated steel plant equipment. The design capabilities of the division have been acclaimed by global customers. 

The reliability of the division in the manufacture of cranes for critical applications such as hot metal handling cranes for the metallurgical industry is without parallel. The division also imparts after sales service for the maintenance of the equipment manufactured by it, thereby adding more value to its customers. The Company is the only indigenous, reliable and economical source of supply for such products. 

The division is able to capture a large share of the market due to its ability to manufacture these highly technical products which require specialised know how and a great deal of customisation to meet specific customer end use. 

The Industrial Machinery division continues to grow at an accelerated pace.

The division has been under constant pressure to increase its capacity to enable it to unleash its true potential. During the year under review, the Company commenced operations from the additional facility that it commissioned next to the Dighe, Thane facility. The Company is further enhancing, manufacturing capacity through the acquisition of land at Sinnar, Nashik from MIDC which will be operational in the financial year 2009 -2010. Gradually over the next three years, this division is expected to grow its capacity to Rs. 7 billion. 

In the year that has gone by, the division not only grew at an accelerated pace but successfully commissioned and erected equipment that it hitherto had not ventured into. Some of these firsts were: 

1) 500 tonne Electric Overhead Traveling (EOT) crane for Larsen and Toubro 

2) 30 tonne Electrical Level Luffing (ELL) crane for Defense department 

3) 100 tonne Hammer Head crane for the Defense department  

4) Copper Plant equipment for copper mines in Zambia 

Work is in progress on the following prestigious orders: 

1) 250 tonne Electric Overhead Traveling (EOT) crane with a lifting beam of 500 tonne for the power sector  

2) 350 tonne Ladle crane for a steel plant 

3) Four girder double trolley 500 tonne EOT crane that will be made for the first time in India 

4) 40 tonne and 60 tonne Electric Level Luffing cranes with 55 metre radius  The 500 tonne Electric Overhead Traveling crane is the first of such a large capacity and the Company has received a repeat order for the same.

The Electric Level Luffing cranes are being executed with assistance from Obe Machinery Co. of Japan. These specifications are being manufactured indigenously for the first time. This will enable the division to bid for abnormal size cranes and machinery which is a niche market. 

The division also bagged an order for the expansion programme of SAIL's IISCO Steel Plant at Burnpur as part of the consortium led by SMS Meer GmbH of Germany. The Company's billing for the order will be at Rs.l.5 billion which will be executed along with its group Company, Mukand Engineers Limited

The scope of work, scheduled to be completed within two years, covers engineering and supply of auxiliary systems for the mill including electrical, Electric Overhead Traveling cranes with rotating trolleys and also site management of the entire mill including erection and commissioning work. 

Road Construction Division: 

The division is executing two projects for the construction of the main carriage way and service road as part of National Highway Project in the State of Uttar Pradesh at Varanasi and Kanpur. As of March 31, 2008, 92% of the entire project has been completed. 

Finance: 

The Company arranged from banks additional funded and non-funded working capital facilities of Rs. 3.32 billion to fund the high increase in input costs and the changing product mix. During the year, the Company paid off Rs. 0.80 billion of its long term loans. In view of the deployment of additional funds, interest charge for the year under report was higher at Rs.1.13 billion as cornpared to Rs.1.00 billion in the previous year. 

The financial restructuring package approved by the Corporate Debt Restructuring (CDR) cell has been implemented fully; except for the conversion of debt to the extent of Rs.118 million into equity by the existing lenders, where the CDR cell has waived the condition of conversion on the Company repaying debt alongwith interest @ 18% per annum compounded on quarterly basis from April 1, 2002. The Company, over the years, has been accounting and paying interest Q 10.50% per annum on a quarterly basis. The difference which has been accounted for and is payable amounts to Rs. 92.11 million. All other conditions laid-down by the CDR are being fulfilled and the interest and installment payments are being made regularly.  

STANDALONE UNAUDITED FINANCIAL RESULTS FOR THE HALF YEAR ENDED30.09.2008

		Quarter ended	Six months ended
	Particulars	30.09.2008 (Rs. In Millions)	30.09.2008 (Rs. In Millions)
1.	INCOME
	Net sales and Other Operating Income
a.	Gross Sales	6612.350	12941.463
	Less: Excise Duty Recovered	784.850	1520.736
	Net Sales	5827.500	11420.727
b.	Other Operating Income	114.903	131.249
	Net Sales and Other Operating Income	5942.400	11551.976
2.	EXPENDITURE
a	(Increase)/Decrease in stock in Trade	(736.215)	(876.370)
b	Consumption of Raw Materials	3430.907	6224.571
c	Purchase of Goods for Trade	122.520	161.032
d	Stores, Spares, Components, Tools, etc. consumed	981.570	1800.000
e	Staff Costs	227.210	451.254
f	Power and Fuel	466.090	858.624
g	Other Expenditure	890.940	1776.899
h	Depreciation	148.100	289.237
i	Expenditure Capitalised	(18.638)	(78.399)
	Total Expenditure	5512.510	10606.848
3.	Profit from Operations before /Loss (Gain) on Variation in Foreign Exchange Rates(net), Other Income, Interest and Exceptional Items (1-2)	429.880	945.128
4.	Loss/(Gain) on Variation in Foreign exchange rates (net)	76.443	121.224
5.	Profit from Operatins before Other Income, Interest and Exceptional Items (3-4)	353.440	823.904
6.	Other Income	7.007	13.267
7.	Profit before Interest and Exceptional Items (5+6)	360.440	837.171
8.	Finance and Lease Charges	347.810	670.233
9.	Profit after interest but before Exceptional Items (7-8)	12.630	166.938
10.	Exceptional Items (Net Income)
11.	Profit from ordinary activities before Tax (9+10)	12.630	166.938
12.	Less: Provision For Taxation
	Fringe Benefit Tax	2.690	5.561
	Wealth Tax	0.000	0.000
	Current Tax (MAT)	0.000	17.184
	Deferred Tax	(19.409)	20.689
	MAT Credit entitlement	0.000	(17.184)
13.	Profit from ordinary activities after Tax	29.349	140.688
14.	Prior Period Adjustments (net)	(14.961)	(14.730)
15.	Excess/ (Short) Provision for tax for earlier years (net)	0.000	0.000
16.	Net Profit for the Period	14.388	125.958
17.	Paid-up Equity Share Capital(Face Value Rs.10/- per share)	731.250	731.257
18.	Reserves (excluding Revaluation Reserve)	0.000	0.000
19.	Earnings per Share (EPS)	0.020	0.172
20.	Public Shareholding	0.000	0.000
	Number of Shares	35194.532	35194.532
	Percentage of Shareholding	48.14%	48.14%

SEGMENT WISE REVENUE, RESULTS AND CAPITAL EMPLOYED FOR THE QUARTER AND YEAR

31.09.2008

		Quarter ended	Six months ended
	SEGMENT REVENUE	30.09.2008 (Rs. In Millions)	30.09.2008 (Rs. In Millions)
1.	Steel	5791.921	11292.890
2.	Industrial Machinery	777.819	1500.184
3.	Road Construction	63.312	232.075
4.	Other Products	9.564	26.058
	Sub total	6642.616	13051.207
	Less: Inter Segment Revenue	(30.265)	(109.744)
	Total Segment Revenue	6612.351	12941.463
	Less: Excise Duty	(784.850)	(1520.736)
	Total Segment Revunue (net of excise duty)	5827.501	11420.727
	SEGMENT RESULT
1.	Steel	204.047	550.100
2.	Industrial Machinery	203.386	395.674
3.	Road Construction	(33.250)	(71.817)
4.	Other Products	(1.317)	2.495
	Less: Inter Segment Margin	(3.236)	(14.660)
	Total Segment Result	369.655	861.492
	Add/(Less):
	Other un-allocable expenditure net of un-allocable income	(24.167)	(39.051)
	Profit before interest and exceptional items	345.488	822.441
	Add/(Less):
	Finance/Lease Charges (net)	(347.819)	(670.233)
	Exceptional Items-net income	0.000	0.000
	Profit after Prior period adjustments and before tax	(2.331)	152.208
	Capital Employed as on:
1.	Steel		16346.536
2.	Industrial Machinery		697.485
3.	Road Construction		2242.712
4.	Other Products		(6.911)
5.	Unallocable		3101.908
	Total Capital Employed		22381.730

Note:

1. Industrial Machinery Division marked an order book growth of 76% on a YOY basis for the first six months of current year. The division expects to maintain its 25% growth till March 2010, with a current order book worth Rs.6580.000 Millions

2. The margins of the Steel Division continued to remain under pressure during the quarter due to increase in the cost of major inputs and strengthening of US Dollar vis-à-vis Indian Rupee.  The prices of major inputs such as, metallurgical coke, nickel, ferro-alloys, fuel oil, etc. now reflect a downward trend and therefore, the margin should improve in the last quarter of the year.

3. The dispute in connection with revision in prices of calibrated iron ore sought by a supplier is yet not settled as Arbitration proceedings continue. However, pending determination of the final price, the supplier has raised invoices at an interim price on the marketing contractor who in turn, has billed the Company at this price and the liability is accordingly accounted for.

4. Prior period adjustments shown above mainly includes, provision of depreciation of earlier years on

reclassification of certain assets.

5. Company signed a Joint Venture Agreement during September 2008 with Vini Iron & Steel Udyog

Limited (VISUL) for mining of coal in the State of Jharkhand in terms of Letter of Allocation of Coal

Block issued by Government of India, Ministry of Coal.  The Joint Venture Company is to carry-out

coal mining operations and share production in the proportion of 58.81 : 41.19 to the Company and

VISUL respectively.

6. Government of India, Ministry of Coal has also conveyed its intention to allocate, alongwith other

Steel companies a share in a coking coal block in the state of Madhya Pradesh to the Company.  The Company’s tentative share in this coking coal reserve is around 13.82 Million Tonnes.

7. Company’s Wholly Owned Subsidiary, Mukand International Limited has invested an amount of US $

2,72,500/- during September 2008 in its wholly owned subsidiary, Mukand International FZE for

setting-up a free zone establishment at Jebel Ali Free Zone, Dubai.

8. Management’s response to the qualifications of the auditors on the financial  statements for the year

ended 31.3.2008

· The Company continues to rely upon market value of unencumbered assets and the earnings from ongoing business of Stainless India Limited and Bombay Forgings Limited. As regards exposure of investments and other dues from its two wholly owned subsidiaries, it relies upon the unsecured financial assets of Vidyavihar Containers Limited and the realization from the financial assets of Mukand Global Finance Limited

· Regarding recoverability of loans from Companies whose net-worth have eroded, the Company continues to rely upon the amounts  likely to be realized from the unsecured financial assets of these companies in a time bound schedule given by these companies for re-payment of loans

· In view of the substantially large claims by the Company for incremental jobs executed, escalations and time-overruns for Road Construction Division, losses currently expected till date are recognized as per the judgment of the Management

9. Figures in respect of previous quarter / year have been regrouped / recast wherever necessary

10. No complaints of investors were pending at the beginning of the quarter as well as at the end of the

Quarter The Company received one complaint during the quarter, which has been resolved.

11. The above results have been reviewed by the Audit Committee and approved by the Board of

Directors at its meeting held on 21st October, 2008.  Statutory Auditors have carried out the “Limited

Review” of the Financial Results shown above.

FIXED ASSETS:

Freehold Land, Leasehold Land, Buildings and Roads, Plant and Machinery, Furniture, Fixtures, etc, Vehicles, Plant and Machinery, Vehicles

The company is in trade terms with :-

Ø A. N. Instruments Private Limited

Ø A. S. Industries

Ø Aeroflex Industries Private Limited

Ø Aero-Tech Ducon Systems Private Limited

Ø Alliance Engineering Company

Ø Allied Instruments and Thermocouples,

Ø Hindustan Technocraft Industries

Ø National Engineering Corporation

Ø Navjeevan Engineering Works

Ø Pallave Chemical Industries

Ø Kumar Industries

Ø S. N. Engineering Works

Ø Pipe Supports India Private Limited

Ø Universal Oil Seals Manufacturers Company Private Limited

Ø Vimtex Machinery

Ø Vinil Process Controls Private Limited

Ø Windston Springs Private Limited

The company has Joint Venture with Mukand International Limited, UK.

AS PER WEBSITE

Subject is part of the Bajaj Groups of companies, one of the most dynamic business groups in India, Bajaj Auto Ltd being the flagship company of the group. The group has substantial manufacturing and marketing interests in diverse fields including scooters, motorcycles and three-wheeler vehicles, electrical appliances etc.

Besides group affiliations, Subject has direct and substantial ownership/management interests in the associate companies listed below.

MUKUND ENGINEERING LIMITED

Specialist in engineering construction

Mukand Engineers Limited has substantial expertise, built up over the years, in all areas of engineering construction including feasibility studies, planning, construction, erection and commissioning of projects. The company is equipped with a whole range of mobile facilities including, mobile cranes, gantry cranes, tower crane etc. It has served industries such as oil exploration and refineries, petro-chemicals, fertilizers, steel plants, thermal and nuclear power plants

Engineering Construction Services

Mukand Engineers Limited undertakes:

· Engineering procurement and construction contracts

· Civil work including architechtural works.

· Structural fabrication and erection

· Piping work

· Mechanical work

· Electrical and instrumentation work

· Testing and commissioning services

· Revamping and shut-down jobs

· Fired heaters and furnaces

· Connected refractory, insulation and painting works

BUSINESS PROFILE

· EPC Contracts

· Engineering Construction

· Revamping and Shutdown Jobs

· Fired Heaters packages

Civil Works

WORKS EXECUTED

· 3,50,000 M ³ of RCC and 4,000 no. of piles

Major Jobs

· Approach Bridges Up To 10 Mtr Width

· Under Ground Cable / Water Tunnel - Over 2 Km

· Over Head Water Tank of Max. 1,000 M³ and Upto +52 Mtr Ht

· Coal Tower of 3,000 M³ Cap. at a Ht of +23 Mtr to + 49mtrs

· Wagon Tippler Foundation Starting from a depth Of 18 Mtr

· Scale Pit Foundation from a depth of 18 Mtr

· HDPE Film Lined Open Reservoir of Capacity 6,00,000 M³

· Track Hopper Foundation For 2 X 500 Mw Power Plant

· Industrial Buildings of Area 35,000 Sqm

Structural Work

75,000 MT of Structures up to Height of +78.5 MTR and 10,000 MT of Technological Structures.

Major Jobs

· Jackets and decks for offshore platforms

· Equip support structures and platforms for Hydro Carbon Industry

· Converter Bay, Mixer Bay, Slag Yard for 1.44 Mn MTPA SMS

· Total Structural Work for 0.3 Mn MTPA Integrated Steel Plant

· Structural Work for Raw Material Handling Plant of 1.0 Million MTPA Integrated Steel Plant

· Technological Structures Including 50,000 M³ Capacity LD Gas Holder

· Pollution Control System Structures, Pig Casting Machine Stand, Billet And Bloom Bay Structures.

· Power plant structures

Fired Heaters

· Total experience of 42 Heaters Upto Heat Duty of 41.12 MMKcal/hr

Piping Works

· More than 2 million Inch-mtr. of Piping of different types of Materials

Major Jobs

· Piping work carried out for LP, HP unit, underground, coated, cement lined, glass reinforced epoxy lined, offsites and jacketed

· Maximum pipe thickness welded - upto 63 mm

Various pipe materials welded

· Carbon Steel - Non-IBR, IBR, NACE

· Stainless Steel -304, 304L, 308, 310, 316, 316L, 347H, 410

· Duplex Stainless Steel

· Cupro – Nickel

· Alloy Steel - P1, P5, P9, P11, P21, P22

· Incolloy – 800

· Titanium

· Aluminium

Electrical and Instrumentation Work

· Over 1,500 km of Cable Laying

· Power Distribution Systems

· Thyristor Drives, Instrumentation and Automation

· Telecommunication , Fire Detection and Alarm Systems

· Lighting

· Earthing and Lightning Protection Systems

Mechanical Works

· Tall columns, internals, heat exchangers and rotary equipment in Refineries

· Fired Heater and heat related packages for Refineries

· Basic Oxygen Furnace shop equipment of Capacity 1.44 mn MTPA

· Medium Merchant Mill of 1 million mtpa

· Converter, Mixer, Desulphurisation plant, Energy Optimising Furnace, Bloom and Billet Caster

· Single piece of 267 MT

· Aluminium strip caster and rolling mills

· Equipment modifications

PROJECTS FOR STEEL INDUSTRY

Steel Authority of India Ltd

· Basic oxygen furnace shop for Rourkela Steel Plant

· Restoration of existing 50,000 M³ Capacity Gas Holder

Hospet Steels, Karnataka

· Civil and Structural work for Integrated Steel Plant

Ispat Industries

· Erection of Twin shell and Ladle furnace for Hot strip mill

Rashtriya Ispat Nigam Ltd

· Assembly, erection and commissioning of Medium Merchant and Structural Mill

· Continuous Casting machines for Steel Melt Shop

PROJECTS FOR HYDROCARBON INDUSTRY

Bharat Petroleum Corporation Ltd

· Fired heaters with APH System

· Piping and mechanical works

· Revamps and shutdowns

Kochi Refineries Ltd

· Piping, Equipment erection, structural work

· Shutdown work

Haldia Petro Chemicals Ltd

· Cold section piping

· Construction of 600,000 cubic mtr capacity Pond

Hindustan Petroleum Corporation Ltd

Fired heaters with APH System

Hindustan Organic Chemicals Ltd

Heaters on turnkey basis

Piping and Equipment erection

Indian Petro Chemicals Ltd

Incinerator

Piping, Structural, Equipment Erection

Oil and Natural Gas Commissions

Regeneration Gas Heater

Piping, Structural, Equipment Erection

PETROFILS

Piping and equipment erection

Piping, Structural, Equipment Erection

Gas Authority of India Ltd

Composite works for LPG Recovery Plant

Indian Oil Cprporation Ltd

Composite works

Revamps and shutdowns

PROJECTS FOR NON-FERROUS INDUSTRY

Bharat Aluminium Company Ltd

Erection, testing and commissioning of hot and cold rolling mill equipment mainly imported from Russia, Germany and partly indigenous - 7400 Tons, and piping - 40,000" M

Erection of Caster and Cold Rolling Mill thru FATA Hunter Italy

WORK DONE JOINTLY WITH SUBJECT

ROURKELA STEEL PLANT - BASIC OXYGEN FURNACE SHOP

Largest Order ever placed on a Private Company in India

Subject / MEL in association with Tyazpromexport, Russia

Order Value : Rs. 6300 Million (1992-1997)

Subject/MEL Share - 85 %

Supply of Equipments

2 X 150 T LD Converter

2 X 1300 T Mixer

13 Nos EOT Cranes including 4 Nos., 250 T Ladle Handling Cranes

Gas Cleaning Plant

Gas Recovery Equipment

Desulphurisation Plant

Electrics, Instrumentation, Process Computerisation

Utilities

HOSPET STEELS

A joint venture of strategic alliance between Subject and Kalyani Group, Pune with the plants located at Ginigera, Karnataka for manufacture of steel from iron ore using mini blast furnace.

Products

Billets/blooms, rolled products.

Facilities and processes

The state-of-the art manufacturingt facilities include :

Mini blast furnace, energy optimizing furnace, ladle furnaces, vacuum degassing, bloom caster, billet caster, blooming mill.

STAINLESS INDIA LIMITED

The company has its plant and facilities at Jodhpur, Rajastan and is in the business of manufacturing and marketing stainless steel flat products

MUKAND INTERNATIONAL LIMITED

The company is engaged in the business of trading in metals and steels products.

BOMBAY FORGINGS LIMITED

The company has modern manufacturing facilities at Aurangabad, Maharashtra for manufacture of closed die forgings

PRODUCTS, PROJECTS AND SERVICES

Products

Alloy, special and stainless steel long products in a variety of grades and sections, to international specifications like Japanese (JIS), German (DIN) American (AISI/SAE) and Indian standards (BIS).

Range

Carbon and alloy steel, free-cutting steel, semi free-cutting steel, leaded free-cutting steel, cold heading quality steel including boron steel, austenitic, ferritic and martensitic stainless steel, spring steel including chrome vanadium steel, high carbon steel, electrode quality steel, boiler quality steel

Condition of supply

As rolled, normalized/soft-annealed, spheroidised-annealed, machine-straightened, peeled/smooth turned/and centreless ground, cold drawn/and centreless ground or in any combination thereof

Size range

Products	Dimensions in mm
Blooms as cast	160 / 200 / 250 mm sq. 240 x 280 mm rectangle
Billets as cast	125 square
Rolled products
Wire rods	5.5,   6,   6.5,   7,   7.5,   8,   8.5,   9,   10, 11,   12,   13,   14,   15,   16.3,   17.5, 18.3,   19,   20,   21,   22,   23,   24,   26,   28.6
Round bars	24,   25,   26,   27.5,   28.5,   30.5,   32,   34,   36, 38,   40,   42,   45,   48,   50,   53,   56,   60,   63,   65, 70,   75,   80,   83,   90,   95,   100,   105,   110, 115,   125,   130,   140,   150
Hexagons (mm A/F)	22.5,   23.5,   25.5,   27.5,   28.5,   30.5, 33.5,   38,   43,   48
Round corner squares	63,   75,   80,   90,   95,   100,   110,   120,   125, 130,   140,   150,   160,   182
Bright bars	3mm to 137mm
Cold finished wires	3.4 to 22mm
*Sizes between 10 and 23 mm dia. rolled in wire rods can be supplied in straightened condition.

End Uses

Subject's steel is not just another product. It is a product that thousands of other products are made of. A random, incomplete listing of end uses :

Kitchen-ware, umbrella ribs, spectacle frames and hairpins, surgical instruments, stainless steel for industrial applications, axle shafts for passenger cars, rear axles in commercial vehicles, coiled springs for passenger cars, hi-tensile fasteners for critical applications in automotive and engineering industry, gears, pinions and forgings for automobile applications, high precision cold forged components for automobile/engineering industry, seamless tubes, races and rings for bearings, springs for railway freight cars, components for textile machinery, components for military hardware.

 MACHINE BUILDING

Products

Electric Overhead Travelling (EOT) cranes, Electrical Level Luffing crane, Gantry crane, container handling crane. Bulk Material Handling

Equipment, Process Plant equipment.

Steel Plant equipment.

Equipment for mining, space exploration and research, defence applications.

Product Profile

Work shop crane

· Crane

· Bulk Material Handling Systems

· Specialised Equipment for

· Steel Plant

· Cement Plant

· Aluminum Plant

· Copper Plant

· Power Plant

Mill body

· Large Fabrication, Machining and Assembly Jobs

· Heavy Steel Casting

· Revamping of Equipment

STEEL PLANT CRANES

· Slag Piercing Crane

· Two/Four Girder Ladle Cranes upto 250 TCapacity

· Rotating Trolley Cranes

· Charging Cranes

Rotating Trolley Crane

· Scrap Handling Cranes with Magnets / Grab

· Billet Handling Cranes

· Special Purpose Cranes

EQUIPMENT FOR STEEL INDUSTRY

Ultra High Power Furnace

· Converter

· Converter relining machine

· Hot Metal Mixers

· Electric Arc Furnaces

1300 T Mixer

· Ladle Furnaces

· Ultra High Power Furnace

· Equipment for Vacuum degassing, vacuum, oxygen Decarburisation

· Rotary Kiln

Ladle

· Cooler for Sponge Iron Plant

· Blast Furnace Shell

· Bell and Hopper

· Pig Casting Machine

Sintering Machine

· Ladles, Slag Pots, Scrap Boxes

· Bloom and Billet Casters

· Sintering Machine

· Door Extractor

Transfer Cars

· Pay off reel

· Moving and Hot Saw

· Transfer Cars

· Hydraulic Scale Breaker for IHI Japan

Rolling mill equipment

Mill Stand Assembly

· Mill Stand

· Roller Table

· Cooling Bed

· Chain Transfer

· Charging and Discharging Equipment

· Cooling Bed

· Jaw and Shear

· Pinch Roll Assembly

· Hydraulic Scale Breakers

· Entry/Del. Side Guides

Steel Plant Casting

· Slag Pots

· Ladles

· Side Guards

· Big Bell / Hopper

· Mill Housings

· Chocks

· Cluster Rolls

· Rolling Mill Housings

EQUIPMENT FOR NON-FERROUS INDUSTRY

· Anode Refining Furnace

· Supplied to Birla Copper

· Ladle Handling Cranes

· Rotary Holding Furnace

· Slag Granulation Plant

· Ladles and Bail Assemblies

· Anode Mould Boxes

· Copper Converter

· Ball Mills

· Rotary Kilns/ Dryers

· Copper Converters

· Anode Refining Furnaces

· Lance / Lance handling Systems

EQUIPMENT FOR POWER PLANT

· 250 T Power House Crane at Koyna

· High Capacity Power House Cranes

· E- Mills

· Various critical machined fabricated components/assemblies 

· E - Mills Mitsui Babcock

Turbine Equipment

· 7FA Turbine base for gas turnine geps USA

· Front standard for steam turbine geps, USA

Power Plant Casting:

· Anode Refining Furnace Supplied to Birla Copper

· Grinding Ring and Ball - Mitsui Babcock Technology

· Stay Ring

· Runner Body

· Butterfly Valve Door

· Spherical Valve Door

· Upstream/Downstream Body

· Cheek / Trunnion

EQUIPMENT FOR CEMENT INDUSTRY

Cement Plant Equipment:

· Grinding Table

· Mill Body

· Pre-heaters

· Pre-Calcinators

· Rotary Kilns

· Grate Coolers

· Cyclones

1300 T Mixer

· Planetary Coolers

· Dryers

· Ball Mills

· Vertical Roller Mills

· Dynamic Air Separators

· Grit - Separators

Handling Equipment:

Mill Head

· Kiln Tyres

· Support Rollers

· Mill Heads

· Girth Gears

Grinding Table

· Slide Rings

· Grinding Tables

· Bearing Blocks

EQUIPMENT FOR PORTS

Port Cranes

· 6T x 23 M. DLL Crane for Andaman

· Electrically Operated Level Luffing Cranes

· Diesel Operated Level Luffing Cranes

· 12T and 16T ELL Cranes at Kandla Port

· Structures for Container Handling Cranes (RMG/RTG)

Bulk Material Handling Equipments

Grab Type Barge Unloader For Essar

· Ship/Barge Unloaders

· Ship Loaders

· Continuous Barge Unloaders

· Coal Handling Stackers

· Bucket Wheel Reclaimers

2,200 MT/Hr. Ship Loader for NALCO

DEFENCE

· Specialized EOT Cranes for DRDO

· Transport Equipments for SBC

· Mechanical Parts for warships for MDL

SPACE RESEARCH

40 - metre high mobile service structure for assembly of augmented satellite launching vehicle (ASLV)

Major clients in India

Government / Public Sector:

· Steel Authority of India Limited

· Bharat Heavy Electricals Limited

· Major Electricity Boards

· Nuclear Ppwer Corporation

· National Thermal Power Corporation Limited

· National Hydro Power Corporation Limited

· Indian Space Research Organisation

· Defence Research and Dvelopment Organisation

· Directorate General of Naval Projects

· Major Ports - KPT, BPT, VPT, MPT

· Ship Building Center

· Indian Navy

· Mazgaon Docks Limited

Private Sector:

· TATA Group Companies

· Larson and Toubro Limited

· Hindustan Aluminum

· National Aluminium Company Limited

· Sterlite/Balco

· Loesche India

· Ispat Industries

· Essar Group

· Birla Copper

Major clients abroad

· General Electric, USA

· Alstom

· Hyundai

· Mitsui

· P.T. Ispat

Turnkey Projects 

150 T Converters

250 T Ladle crane

A 40 – metre high mobile service structure for assembly of augmented satellite launching vehicle (ASLV) for Indian Space Research Organization (ISRO). This is essentially a facility to assemble rockets in an enclosed, controlled environment : virtually, a workshop that moves on wheels.

An anode handling and rodding plant, jointly with Syprim SA (France) for National Aluminium Company Limited., where over 70 material handling and processing stations were integrated into a single automatic system through programmable logic controls.

A medium merchant structural mill with an annual capacity of 850,000 tonnes for Visakhapatanam Steel Plant – a Government of India enterprise – jointly with Skodaexport (Czech Republic). The total configuration, including 11,000 tonnes of mechanical equipment manufactured by Subject, weighing over 17,500 tonnes was erected by Subject.

A basic oxygen furnace shop for the Rourkela Steel Plant of the Steel Authority of India Limited., with a capacity of 1.5 million tonnes per annum, in a consortium lead by, and jointly with, Tyazhpromexport (Russia). The scope of the work covered design, manufacture, supply, execution of related civil and structural work, erection and commissioning of facilities including : two 150 - tonne LD converters, two 1300 - tonne mixers, thirteen EOT cranes including four 250 – tonne ladle handling cranes, gas cleaning plant, gas recovery equipment, desulphurisation plant, electricals, instrumentation, process computerization and utilities.

Civil, structural and mechanical work for steel plant at Hospet, with a capacity of 0.3 million tonnes per annum. The scope of the work covered : civil and structural work, mechanical equipment such as converters, energy optimizing furnace, mixer, vacuum degassing units, bloom casters, material handling equipment such as EOT cranes, electricals, instrumentation and utilities.

Infrastructure : Highway Construction

Projects

Two highway construction projects funded by by the World Bank, for which the contaracts were won through international competitive bidding by Centrodorstoy, a leading Russian company with proven expertise in the field in associatin with Subject, are under execution. The projects are part of the ' Golden Quadrilateral ' announced by the Prime Minister of India. Subject responsibility covers supply of material, machinery and manpower as well as other services incidental to the execution of the projects.

Salient Features

Two packages –

 Construction of 77 KM four-lane highway consisting of 94 KM of two-lane concrete pavement and 60 KM of two-lane asphalt pavement for the Ashapur-Khaga stretch of NH-2.

 Construction of 72 KM four-lane highway consisting of 56 KMs of two-lane concrete pavement and 88 KM of two-lane asphalt pavement in Handia-Rajatalao stretch of NH-2.

The work includes the following –

Ashapur-Khaga Handia-Rajatalao

Minor bridges 6 8

Culverts 116 35

Under Passes/Subways 3 4

Concrete pavement 273,000 cu.m 156,000 cu.m

Asphalt pavement 120,000 cu.m 160,000 cu.m

Earthwork 1,760,000 cu.m 2,500,000 cu.m

FACILITIES AND PROCESSESS

Steel

· Ultra High Power Electric Arc Furnace at Kalwe

· Ladle Refining Furnace at Kalwe

· Vacuum Degassing at Kalwe

· Fully Automatic Wire Rod Mill at Kalwe

· Mini Blast Furnace at Hospet

· Energy Optimizing Furnace at Hospet

· Continuous Casting at Kalwe

· Easy Draw Continous Cooling System for wire rods at Kalwe

Steel Plant of Subject at Kalwe near Mumbai, Maharashtra is India's most modern electric arc furnace complex. It is equipped with a state-of-the-art ultra high power furnace, with computerized process controls, scrap pre-heating arrangements operating on a heat recovery system with facilities for eccentric bottom tapping, oxy-fuel burners and ladle refining furnace.

The bar mill, with its walking beam type cooling bed is the state-of-the-art type and so is the fully automatic wire rod mill and so is the eight-strand, no-twist block mill.

Subject steel plant uses ‘easy draw continuous cooling' system for wire rods. Blooming mill facilities include a walking beam furnace, automatic screw down system and computerised process controls. The bright bar unit is equipped with modern facilities including heat treatment furnaces for bars and coils and facilities for spheroidised annealing for coils.

Steel Plant at Hospet, Karnataka makes steel using mini blast furnace technology, with iron ore and metallurgical coke as major inputs. Hot metal from mini blast furnace is converted into steel using energy optimizing furnace technology. The plant is equipped with bloom and billet caster (10/18 and 9/16 m radius respectively), with modern process controls including auto mould level control and electro magnetic stirrer.

SOME OF THE MAJOR CUSTOMERS SERVED

Original equipment manufacturers (OEMs) like -

Motor Industries Co. Limited Hi-Tech Gears Limited

SKF India Limited Sundram Fasteners Limited

Maruti Udyog Limited Hero Honda Motors Limited

Dephi Automotive Systems Limited

Bajaj Auto Limited

Sona Koyo Stearing Systems Limited

Honda Motor Cycle and Scooter India Private Limited

MACHINE BUILDING and TURNKEY PROJECTS

Government sector in India Non - government sector in India

Steel Authority of India Limited Tata Group of companies

National Aluminium Company Limited Larsen and Toubro Limited

Bharat Heavy Electricals Limited Hindustan Aluminium Limited

State Electricity Boards Sterlite/Bharat Aluminium Company Limited

Nuclear Power Corporation Limited Loesche India

National Thermal Power Corporation Limited Ispat Industries

National Hydro Power Corporation Limited Essar Group

Indian Space Research Organisation Birla Copper

Defence Research and Development Organisation

Directorate General of Naval Projects

Port Trusts

Indian Navy

Ship Building Centre

Mazgaon Docks Limited

General Electric

Alstom

Hyundai

Mitsui

P.T. Ispat

Infrastructure : Highway construction

Customers in India

National Highways Authority of India

ANNUAL REPORT 2007- 2008

MUKAND LIMITED 

ANNUAL REPORT 2007-2008 

PRESS RELEASE

Press note

29 July 2008

Mukand turnover up

The turnover of the company for the quarter ended June 30, 2008 increased by 27% at Rs. 6330.000 millions as compared to Rs. 4980.000 millions in the corresponding period of the previous year. The margins of the steel division were under pressure during the quarter due to the sharp increase in the cost of major inputs such as metallurgical coke, ferro alloys, fuel, etc.. The selling price is periodically being revised for new orders to absorb the increase in input costs.

The net profit of the company during the first quarter stood at Rs. 111.300 Millions.

The revenues from the steel division increased to Rs 5500.00 Millions during the first quarter of the financial year 2008 -09 as compared to Rs. 4300.000 Millions  during the same period previous year. The revenues from the industrial machinery division increased to Rs. 720.000 Millions during the first quarter compared to Rs. 570.000 Millions of the same period in the previous year.

The capex programme at the Company is nearing completion and the third mini blast furnace has been commissioned and installed at the Ginigera facility taking the company’s steel making capacity to half a million ton per annum. Installation of additional rolling and finishing capacities to meet this enhanced steel making capacity is also nearing g completion. This will also enhance the product mix currently offered by the company and enable it to cater to the global markets. 

The orders on hand with the Industrial Machinery division stood at Rs. 6060.000 Millions as at the end of the first quarter. To uncork the bottle neck which was in terms of space, the division has acquired land from MIDC at Sinnar near Nasik.

For further information please contact,

Ms Anna Abraham, Mukand Ltd.

98201403332

May 20th, 2008

Mukand’s Industrial Machinery Division continues to grow at 17.5%

The Turnover and other income forthe year 2007-08 rose by6% at Rs.22220.000 Millions as against Rs.21000.000 Millions in the previous year. The company is in the last phase of the expansion and modernisation programme which will take the company’s annual steel making capacity in excess of half a million tonnes of speciality steel long products. This programme is being undertaken at both the company’s facilities at Dighe, Thane and Ginigera, Karnataka while maintaining the regular production schedules of the company.

The profit before tax for the year stood at Rs.900.000 Millions as against Rs.1150.000 Millions in the previous year. This dip is mainly due to the steep increase in the costs of major steel making inputs, such as coke, iron ore, scrap, fuel oil, ferro-alloys etc. Although the company did increase selling prices of its products, the time lag in effecting this price rise has affected the margins of the company.

The company’s products are being sought by some of the best global brands resulting in a 27% increase in the export revenues at Rs.1750.000 Millions in the year under review. The company plans to continue expanding its markets.

The Company is setting-up a 15 MW captive power plant at Ginigera, Karnataka which is expected to be commissioned in the 3rd Quarter of the year in progress.

The Industrial Machinery division of the company continues its growth trend marking a 17.5% increase in its turnover in the year under review at Rs. 2740.000 Millions as against Rs. 2230.000 Millions in the previous year.

The division has orders worth Rs. 5800.000 Millions at the close of the year for the manufacture of heavy duty cranes and process plant equipment. The company is now in the midst of putting up another facility at Sinnar, Nasik which, on completion will enhance the capacity of the division taking the annual revenues to Rs.7000.000 Millions.

Mukand has proposed a modest dividend of Re. 1 per share in order to conserve resources to finance capital expenditure and reduce debt.

For further communication, please contact

Anna Abraham, Mukand Ltd.

9820140332

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. 49.25
UK Pound	1	Rs. 80.36
Euro	1	Rs. 62.84

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	6
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	6
--RESERVES	1~10	6
--CREDIT LINES	1~10	6
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		54

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		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

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