MIRA INFORM REPORT

Report Date :

18.11.2008

IDENTIFICATION DETAILS

Name :	LIFELINE INDUSTRIES LIMITED
Registered Office :	A Wing, 401, Master Mind III, Royal Palm Aarey Milk Colony, Goregaon (East), Mumbai - 400065, Maharashtra
Country :	India
Financials (as on) :	31.03.2007
Date of Incorporation :	24.03.1986
Com. Reg. No.:	11-39313
CIN No.: [Company Identification No.]	U24110MH1986PLC039313
TAN No.: [Tax Deduction & Collection Account No.]	MUMS34691G
PAN No.: [Permanent Account No.]	AACCS3496E
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturer of Bulk Drugs and Chemicals.

RATING & COMMENTS

MIRA’s Rating :

B

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average.	Small

Maximum Credit Limit :	USD 200000
Status :	Moderate
Payment Behaviour :	Slow but Correct
Litigation :	Clear
Comments :	Subject is an established company having moderate track. Payments are reported as slow but correct. Profit margin is under severe pressure. The company can be considered for small to mediocre business dealings at usual trade terms and conditions.

INFORMATION PARTED BY

Name :	Mr. Ravi Vishvakarma
Designation :	Finance Officer
Date :	15.11.2008

LOCATIONS

Registered Office :	A Wing, 401, Master Mind III, Royal Palm Aarey Milk Colony, Goregaon (East), Mumbai - 400065, Maharashtra, India
Tel. No.:	91-22-28794115
Mobile No.:	91-9322282875
E-Mail :	nikunjkanakia@lifelinepharma.in info@lifelinepharma.in
Website :	http://www.lifelinepharma.net
Area :	9000 sq. ft.
Location :	Owned
Corporate Office :	A – 25, Virwani Industrial Estate, Western Express Highway, Goregaon, Mumbai – 400063, Maharashtra, India
Tel. No.:
Fax No.:	91-22-28506465
Factory :	B -10, MIDC Akkalkot Road, Solapur, India
Tel. No.:	91-217-2652036
Area :	4000 sq. ft.
Location :	Leased

DIRECTORS

Name :	Mr. Kirtikumar M. Kanakia
Designation :	Director
Address :	Flat No.701/702, Quarter Deck Co-Op Housing Limited, 7 Bunglow J. P. Road, Andheri (West), Mumbai – 400058, Maharashtra, India
Date of Birth/Age :	11.11.1948
Date of Appointment :	02.05.2005
Email :	kirtibhai@prominent-travels.com
Name :	Mr. Prakash Raval
Designation :	Director
Address :	A – 16, 3^rd Floor, Chitralaya, Behind Hotel Contessa, K P Nagar, Boisar, Thane – 401501, Maharashtra, India
Date of Birth/Age :	01.11.1964
Date of Appointment :	18.11.2004
Name :	Mr. Nikunj Kanakia
Designation :	Director
Address :	Flat No.701/702, Quarter Deck Co-Op Housing Limited, 7 Bunglow J. P. Road, Andheri (West), Mumbai – 400058, Maharashtra, India
Date of Birth/Age :	22.06.1975
Date of Appointment :	02.05.2005

KEY EXECUTIVES

Name :	Mr. Navneet V. Bhalani
Designation :	Company Secretary
Address :	602 Shwetambari, N. S. Road, No.5 (Estansion) Juhu Scheme, Mumbai – 400049, Maharashtra, India
Date of Birth/Age :	15.10.1969
Date of Appointment :	01.03.2008
Email :	Navneet.bhalani@rediffmail.com

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

(As on 10.09.2007)

Names of Shareholders	No. of Shares
Nikunj Kanakia	1380640
Kirtikumar M. Kanakia	1449090
Heena Kanakia	10
Jayshree Kanakia	10
Inland Impex Private Limited	275550
Riviera Mercantile Private Limited	342000
Anil Jain	11750
Aditya Jain	139500
Tarachand Jain	60000
Sunil Jain	48000
Rajani Rahurikar	18000
Ashok Chawala	6500
Sarla Chawla	5950
Kishore Chawla	6000
Santosh Kotecha	1500
Manish Kotecha	1000
Surendra Kotecha	1000
Rajkumar Jain	2000
Nirmaladevi Jain	1500
Gunvantrai Changela	4000
Total	3754000

(As on 14.08.2008)

Names of Allottees	No. of Shares Allottes
Kirtikumar M. Kanakia	144600
Nikunj Kanakia	70840
Prakash Rawal	7
N. K. Exim Private Limited	61884
Lifeline Drugs Private Limited	85169
Total	362500

(As on 29.09.2007)

Category	Percentage
Bodies Corporate	16.45
Directors of relatives of directors	75.37
Other top fifty shareholders (Other than listed above)	8.18
Total	100.00

BUSINESS DETAILS

Line of Business :	Manufacturer of Bulk Drugs and Chemicals.
Exports :
Countries :	Middle East
Imports :
Countries :	China
Terms :
Selling :	Depends
Purchasing :	Depends

GENERAL INFORMATION

Customers :

• End Users
• Trader

No. of Employees :

100 (Office – 30 and Factory – 70) (Contract Workers – 40)

Bankers :

• Canara Bank

Khar (West) Branch, P D Hinduja Marg, Khar West, Mumbai – 400052, Maharashtra, India

Facilities :

Secured Loans	31.03.2007 (Rs. In Millions)
Canara Bank Term Loan I	28.273
Canara Bank Term Loan II	12.900
Canara Bank Working Capital Loan	126.097
Canara Bank DPN Loan	5.000
Motor Car Loans from Banks and Institutions	2.061
Total	174.331
Unsecured Loans	31.03.2007 (Rs. In Millions)
From Members, Directors and Other relatives	113.308
Sales Tax Deferred Loan Payable	15.103
Total	128.411

Banking Relations :	Satisfactory
Auditors :
Name :	Atul C. Shah and Associates Chartered Accountant
Address :	A/ 101, Sharda Gram, Mathuradas Road, Kandivli (West), Mumbai – 400067, Maharashtra, India

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
3750000	Equity Shares	Rs.10/- each	Rs.37.500 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
3750000	Equity Shares	Rs.10/- each	Rs.37.500 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2007	31.03.2006	31.03.2005
SHAREHOLDERS FUNDS
1] Share Capital		37.500	15.135	15.135
2] Share Application Money		0.000	20.050	6.050
3] Reserves & Surplus		8.462	3.158	3.158
4] (Accumulated Losses)		0.000	(19.171)	(22.687)
NETWORTH		45.962	19.172	1.656
LOAN FUNDS
1] Secured Loans		174.331	75.299	26.673
2] Unsecured Loans		128.411	79.697	16.132
TOTAL BORROWING		302.742	154.996	42.805
DEFERRED TAX LIABILITIES		10.928	7.212	0.000
TOTAL		359.632	200.550	44.461
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		114.361	41.813	41.861
Capital work-in-progress		0.000	17.348	0.000
INVESTMENT		0.420	0.420	0.420
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	115.649	108.291	3.309
	Sundry Debtors	115.506	26.933	0.599
	Cash & Bank Balances	3.737	3.122	0.243
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	47.264	19.835	10.242
Total Current Assets		282.156	158.181	14.393
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	36.059	35.248	12.213
	Provisions	1.246	1.134	0.000
Total Current Liabilities		37.305	36.382	12.213
Net Current Assets		244.851	121.799	2.180
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		359.632	200.550	44.461

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
Sales Turnover		773.302	248.474	11.036
Other Income		0.256	3.232	27.263
Total Income		773.558	251.706	38.299
Profit/(Loss) Before Tax		28.405	11.823	11.129
Provision for Taxation		3.929	8.307	0.000
Profit/(Loss) After Tax		24.476	3.516	11.129
Export Value		54.679	NA	NA
Expenditures :
	Raw Material Consumed	693.860	265.982	8.511
	Manufacturing Expenses	15.564	11.024	9.830
	Administrative Expenses	11.629	5.430	3.306
	Financial Charges	18.491	8.121	1.192
	Depreciation & Amortization	5.609	4.105	2.526
	Increase/(Decrease) in Finished Goods	0.000	(54.779)	1.805
Total Expenditure		745.153	239.883	27.170

KEY RATIOS

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
PAT / Total Income	(%)	3.16	1.40	29.06
Net Profit Margin (PBT/Sales)	(%)	3.67	4.76	100.84
Return on Total Assets (PBT/Total Assets}	(%)	7.16	5.91	19.78
Return on Investment (ROI) (PBT/Networth)		0.62	0.62	6.72
Debt Equity Ratio (Total Liability/Networth)		7.40	9.98	33.22
Current Ratio (Current Asset/Current Liability)		7.56	4.35	1.18

LOCAL AGENCY FURTHER INFORMATION

Note:

The Registered Office of the company has been shifted from No.8, New Tejpal Industrial Estate, Andheri Kurla Road, Sakinaka, Mumbai – 400072, Maharashtra, India, to the present address w.e.f. 01.06.2007.

They had 3 Sister Companies but they are going to merge into Lifeline Industries Limited

Trade Reference:

• Sun Pharma
• Divis Lab – Hyderabad

Fixed Assets:

• Land
• Factory Building
• Office Building
• Plant and Machinery
• Furniture and Fixtures
• Computers Systems
• Vehicles

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.49.46
UK Pound	1	Rs.73.17
Euro	1	Rs.62.96

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	4
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	4
--PROFITABILIRY	1~10	2
--LIQUIDITY	1~10	4
--LEVERAGE	1~10	4
--RESERVES	1~10	4
--CREDIT LINES	1~10	4
--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		37

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