MIRA INFORM REPORT

Report Date :

10.10.2008

IDENTIFICATION DETAILS

Name :	KORES (INDIA) LIMITED
Registered Office :	Kores House, Plot No. 10, Off Dr. E. Moses Road, Worli, Mumbai - 400 018, Maharashtra
Country :	India
Financials (as on) :	31.03.2007
Date of Incorporation :	26.05.1936
Com. Reg. No.:	11-2494
CIN No.: [Company Identification No.]	U21198MH1936PLC002494
TAN No.: [Tax Deduction & Collection Account No.]	PNEK05297F
PAN No.: [Permanent Account No.]	AAACK5069Q
Legal Form :	A Closely Held Public Limited Liability Company.
Line of Business :	Manufacturing and Trading in Carbon Paper, Stencils, Ribbons, Cloth, Yarn, Inks, Barium Carbonate/Granules, Sodium Sulphide, Photocopiers, Rock Roller Bits, Teleprinter and other M/c. Rolls, Duplicating papers, Drilling equipments, Cheque Encoders, PPO-2-5 Diphenyl Oxazole, Castings, Resistors, Theophlline, Caffeine, Victoria Blue and Etophylline.

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 3200000
Status :	Good
Payment Behaviour :	Slow but Correct
Litigation :	Clear
Comments :	Subject is a well established diversified company having satisfactory track. Trade relations are fair. Financial Position is satisfactory. The company is doing well. Its payments are reported as slow but correct. The company can be considered good for normal business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	Kores House, Plot No. 10, Off Dr. E. Moses Road, Worli, Mumbai 400 018, Maharashtra, India
Tel. No.:	91-22-2494 6555
Fax No.:	91-22-2495 0401
E-Mail :	info@kores-india.com legal@kores-india.com
Website :	http://www.kores-india.com
Area :	Leased
Factory :	Thane: 1^st Pokharan Road, Thane (West) – 400 606, Maharashtra, India [Area : Owned] Indore: Plot No. 6, Industrial Area No.1, Pithampur, Indore – 452 001, Madhya Pradesh, India Wankaner: Shri Amarsinhji Mills, Post Bag No.3, Wankaner – 363 621, Gujarat, India [Area : Owned] Pune: Plant No. I: E-14, 15 and 16, Bhosari Industrial Area, Pune – 411 026, Maharashtra, India Tel. No.: 91 20 7120741 / 7120511 Fax No.: 91 20 7120014 Area : Owned Plant No. II: Gat No. 149, Chakan, Talegaon Road, Chakan, Dist. Pune – 410 501, Maharashtra, India Area : Owned Roha: Plot No. 59A, 65B, 65C and 66A, MIDC, Industrial Area, Dhatav, Roha, Dist. Raigad, Maharashtra, India Area : Owned Rudrapur (Uttranchal): Plot No. 15, Sector 211 E, Panthnagar, Rudrapur – 263154, Uttranchal Area : Owned
Zonal and Branch Offices:	Located at : Ahmedabad Bangalore Baroda Bhopal Chandigarh Coimbatore Chennai (Zonal Office) Ernakulam Goa Hyderabad Indore Jaipur Kolkata (Zonal Office) Lucknow Mumbai (Zonal Office) New Delhi (Zonal Office) Nagpur Panchkula Patna Pune Vishakhapatnam
Corporate Office :	Pharmaceuticals and Chemical Division C – 7/ 1 – B, TTC Industrial Area, MIDC, Pawane, Navi Mumbai – 400 705, Maharashtra, India.
Tel. No.:	91-22-24946555
Fax No.:	91-22-24950401

DIRECTORS

Name :	Mr. S. K. Thirani
Designation :	Chairman and Whole Time Director
Date of Birth/Age :	77 Years
Qualification :	Inter Science
Experience :	51 years
Date of Appointment :	30.11.1956
Name :	Mr. A. K. Thirani
Designation :	Managing Director
Date of Birth/Age :	51 Years
Qualification :	B. Com.
Experience :	26 years
Date of Appointment :	29.05.1981
Name :	Mr. R. K. Saboo
Designation :	Executive Director
Date of Appointment :	01.03.2006
Name :	Mr. K. G. Menon
Designation :	Director
Date of Birth/Age :	76 Years
Qualification :	B. Sc., (Tech.), A.M.I.I. Chem. E., A.M.I. Indus.E. (Ind.)
Experience :	54 Years
Date of Appointment :	01.11.1968
Name :	Mr. J. P. Gupta
Designation :	Director
Name :	Mr. S. K. Patel
Designation :	Director
Name :	Mr. B. K. Binani
Designation :	Director (upto 27.05.2003)

KEY EXECUTIVES

Name :	Mr. M. K. Iyer
Designation :	Company Secretary and Vice President - Legal
Name :	Mr. D. R. Ranawat
Designation :	Company Secretary
Name :	Mr. D.N. Mishra
Designation :	Director – Marketing and Sales
Date of Birth/Age :	64 Years
Qualification :	B.Sc.
Experience :	43 Years
Date of Appointment :	24.12.1964
Name :	Mr. R.V. Nagendra
Designation :	Chief Operating Officer
Date of Birth/Age :	61 Years
Qualification :	B.Sc., (Chem), PGDM
Experience :	38 Years
Date of Appointment :	16.10.2002
Name :	Mr. V.W. Mane
Designation :	Chief Operating Officer
Date of Birth/Age :	51 Years
Qualification :	B.Tech.
Experience :	27 Years
Date of Appointment :	02.11.1995

BUSINESS DETAILS

Line of Business :

Manufacturing and Trading in Carbon Paper, Stencils, Ribbons, Cloth, Yarn, Inks, Barium Carbonate/Granules, Sodium Sulphide, Photocopiers, Rock Roller Bits, Teleprinter and other M/c. Rolls, Duplicating papers, Drilling equipments, Cheque Encoders, PPO-2-5 Diphenyl Oxazole, Castings, Resistors, Theophlline, Caffeine, Victoria Blue and Etophylline.

Products :

Products	ITC Code No.
Ink Cartridge	07.06
Other Cast Articles of Iron and Steel	73.25
Carbon Paper	48.16

Exports :

Countries :

USA, UK, Germany, Switzerland, France, Canada and Japan

Imports :

Countries :

Europe and Far East

Terms :

Purchasing :

L/C and D/P terms

PRODUCTION STATUS(As on 31.03.2007)

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
Drilling Equipment etc.	Nos.	90	45	3
Yarn	Kgs.	25000 Spindles	20160	1351794
Castings	MT	35760	35760	15972
Bulk Drug and Drug Intermediates	Kgs.	NA	464000	404633
Speciality Chemical	MT	23	18	2536
Encoders/ Reader Sorter	Nos.	3600	3600	231
Photo Copier Machine	Nos.	NA	4000	-
Adhesive and Emulsion	MT	6000	4000	2200

GENERAL INFORMATION

Suppliers :

Ø Amruta Industries

Ø Kulswamini Enterprises

Ø Yogesh Enterprises

Ø Trimurti Engineering Works

Ø Asha Industries

Ø Triple Engineers

Ø Amar Industries and Fine Chemical

Ø S.B. Enterprises

Ø Aniket Felting Works

Ø Metaplast Engineering Works

Ø Vishal Fetting Works

Ø Mahalaxmi Industries

Ø Gurudatta Enterprises

Ø Pepega (IandP) Limited

Ø Techno Craft

Ø Soni Engineers

Ø Parmar Industries

Ø Akshya Enterprises

Ø Khushboo Enterprises

Ø Shree Ganesh Enterprises

Ø B. K. Industries

Ø Solar Packaging Private Limited

Ø Polar Chem Industries

Ø Lunar Motor Private Limited

No. of Employees :

2000

Bankers :

Ø Central Bank of India, M. G. Road, Mumbai - 400 023, Maharashtra

Ø Bank of Baroda, Bhadra Branch, Ahmedabad, Gujarat

Ø Dena Bank

Ø State Bank of Indore

Ø State Bank of India

Facilities :

Secured Loan	As on 31.03.2007 (Rs. In Millions)
Cash Credit Account
- Central Bank of India	254.047
- Bank of Baroda	149.744
- State Bank of India	82.253
- Dena Bank	90.566
- State Bank of Indore	47.955
Term Loans From Banks:
For Voluntary Retirement Scheme
- Dena Bank	0.900
For Machinery and Equipment:
- Central Bank of India	162.746
- State Bank of India	31.750
- Dena Bank	0.375
For Premises
- ICICI Bank	6.000
Lease and Hire Purchase Instalments	16.785
Vehicle Loans	11.736
Foreign Exchange Risk Premium (Accrued but not due)	0.870
Total	855.727
Unsecured Loans:
SICOM Limited (Interest free loan under New Package Scheme of Incentives)	37.238
Short Term Loan from Bank	40.000
Intercorporate Deposits	61.900
Bill Discounting	30.013
Loan form Directors	2.400
Interest accrued and due	1.734
Fixed Deposits (Due with in one year Rs.2.058 Millions previous year Rs.1.890 Millions) (Includes Rs.8.749 Millions received in Foreign Currency Previous Year Rs.8.749 Millions)	15.149
Total	188.434

Banking Relations :	Satisfactory
Auditors :
Name :	Singhi and Company Chartered Accountants
Associates/Subsidiaries :	Ø Kores Services Limited (up to 31 -8-05) Ø Solar Packaging Private Limited Ø Shashi Finance Limited Ø Pepega (Insulation and Packaging) Limited Ø Quality Inks Limited Ø Amarsinhji Stationery Industries Limited Ø Kores Printer Technology Private Limited Ø Nandini Chemicals Private Limited Ø Futuristic Securities Limited Ø Jupitor Stationery Private Limited Ø Matrix Business Machines Private Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
7500000	Equity Shares	Rs. 10/- each	Rs. 75.000 Millions
250000	11% Redeemable Preference Shares	Rs. 100/- each	Rs. 25.000 Millions
	Total:		Rs. 100.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
5500000	Equity Shares	Rs. 10/- each	Rs. 55.000 Millions
200000	11% Redeemable Preference Shares	Rs. 100/- each	Rs. 20.000 Millions
	Total:		Rs. 75.000 Millions

Out of Above

2315302 Equity Shares are allotted as fully paid up Bonus Shares by way of Capitalization of General Reserve.

80604 Equity Shares allotted to the Shareholders of erstwhile Pefco Industries Limited on its merger with the company as per the order of B.I.F.R. dated 20.05.1991.

8105 Equity Sahres to the Shareholders of erstwhile Koron Business Systems Limited on its merger with the company as per the order B.I.F.R. dated 16.01.1995

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		75.000	75.000	75.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		559.857	443.571	329.364
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		634.857	518.571	404.364
LOAN FUNDS
1] Secured Loans		855.727	534.203	497.036
2] Unsecured Loans		188.434	330.588	142.318
TOTAL BORROWING		1044.161	864.791	639.354
DEFERRED TAX LIABILITIES		50.147	39.197	40.780
TOTAL		1729.165	1422.559	1084.498
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		771.884	509.820	420.183
Capital work-in-progress		38.358	46.816	22.113
INVESTMENT		24.103	12.272	0.713
DEFERREX TAX ASSETS		0.000	0.000	0.000
Technical Know-how		0.000	0.000	0.400
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	983.634	758.507	604.654
	Sundry Debtors	1169.799	869.684	581.693
	Cash & Bank Balances	199.388	130.253	64.866
	Other Current Assets	4.427	2.981	3.825
	Loans & Advances	423.193	362.219	305.279
Total Current Assets		2780.441	2123.644	1560.317
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	1843.687	1245.093	898.718
	Provisions	43.426	30.932	31.855
Total Current Liabilities		1887.113	1276.025	930.573
Net Current Assets		893.328	847.619	629.744
MISCELLANEOUS EXPENSES		1.492	6.032	11.345
TOTAL		1729.165	1422.559	1084.498

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
Sales Turnover		7453.412	5907.008	4679.806
Other Income		795.199	629.977	0.000
Total Income		8248.611	6536.985	4679.806
Profit/(Loss) Before Tax		188.278	163.827	80.460
Provision for Taxation		61.053	44.603	23.450
Profit/(Loss) After Tax		127.225	119.224	57.010
Earnings in Foreign Currency :
	Export Earnings	212.111	171.232
	Commission Earnings	0.580	0.531
Total Earnings		212.691	171.763	171.778
Imports :
	Raw Materials	95.239	74.944
	Stores & Spares	17.487	7.464
	Capital Goods	72.240	10.321
	Finished Goods	180.635	125.106
	Trading on Highseas	9.064	6.600
Total Imports		374.665	224.435	233.928
Expenditures :
	Opening Stock	583.753	458.558	NA
	Raw Material Consumed	914.490	793.983	NA
	Purchases of Finished Goods	4846.318	3636.229	NA
	Cost of Construction Project	100.634	62.483	NA
	Manufacturing & Other Expenses	783.570	666.166	NA
	Payments to & Provisions for Employees	378.792	335.048	NA
	Selling & Distribution Expenses	259.040	274.150	NA
	Interest & Finance Charges	110.254	83.249	NA
	Depreciation & Amortization	79.438	59.492	NA
	Other Expenditure	4.044	3.800	4575.550
Total Expenditure		8060.333	6373.158	4575.550

KEY RATIOS

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
PAT / Total Income	(%)	1.54	1.82	1.22
Net Profit Margin (PBT/Sales)	(%)	2.53	2.77	1.72
Return on Total Assets (PBT/Total Assets}	(%)	5.21	6.08	4.02
Return on Investment (ROI) (PBT/Networth)		0.30	0.32	0.20
Debt Equity Ratio (Total Liability/Networth)		4.62	4.13	3.88
Current Ratio (Current Asset/Current Liability)		1.47	1.66	1.68

LOCAL AGENCY FURTHER INFORMATION

OFFICE PRODUCTS DIVISION:

During the year, the Division has introduced many new products to suit the market/ customer demands resulted increase in sales and also better current assets management the bottom line has also improved. For the current year the division is doing fairly well.

I.T. DISTRIBUTION DIVISION:

Besides the activities of national channel partners of Hewlett (HP)’s I.T. peripherals, also engaged in dealing of Samsung Cartridges as addition to existing activity. Due to competition in the market high pressure is on margin and market share. For the current year expecting the reasonable growth in turnover however margins continued to be under pressure.

REAL ESTATE DIVISION:

During the year, four buildings of ‘Kores Nakshatra’ project have been completed and also acquired some land. In house marketing strategy in tune with consumers’ needs and favourable scenario in Real Estate Industry are likely to result into encouraging performance in the current year.

BUSINESS AND COMPUTER SYSTEM DIVISION:

During the year, the Division has introduced new model of Cheque Encoder and Digital Storage Device and Media. Turnover has increased by 11% compared to previous year. Also bottom line has been improved compared to previous year. For the current year, it is expected better turnover with a good margin.

PHARMACEUTICALS AND CHEMICALS DIVISION:

During the year, there is a substantial increase in turnover compared to previous year. But the profit margins were under pressure mainly due to increase in input cost.

For the current year, the out look of the Division is better because of operational efficiency and hopefully the margins will improve.

FOUNDRY DIVISION:

During the year, the Division has taken up the expansion of its Chakan Unit and the new production (Koyo Line) commenced in the month of April, 2007. The turnover of the Division during the year has increased, but the profitability were under pressure due to increase in the price of basic raw materials and due to sluggish market condition cost escalation could not be passed on to customers.

TEXTILE DIVISION:

During the year, the Division has fared well and the products of the Division are well accepted by the corporate clients also. The Division has taken up expansion plan which will be completed in the current year.

ENGINEERING DIVISION :

During the year, the division has shown better performance and the same is expected to continue for the current year also.

EXPORT:

Export during the year is Rs.212.100 Millions as compared to Rs.171.200 Millions in the previous year.

DIVIDEND:

The Directors recommend for consideration of the shareholders at the ensuring Annual General Meeting payment of a Dividend of Rs.0.50 per share (5%) on 5500000 equity shares for the year 2006-07 and @11% on 200000 Redeemable Preferences Shares for the Financial Years 2003-04 to 2006-07. The outflow of Dividend and the tax thereon aggregates to Rs.10.939 Millions.

THE PRODUCT RANGE INCLUDES THE FOLLOWING:

Ø Typewriter Carbons

Ø Pencil Carbons

Ø Duplicating Stencils

Ø Duplicating Inks

Ø Typewriter Ribbons

Ø MICR Ribbons

Ø Eraz-ex-Fluid

Ø Art Materials

Ø Fax Rolls

Ø Tracing Papers

Ø Glue Sticks

Ø Staple Pins and Stapling Machines

FIXED ASSETS:

Land, Building – (On Leasehold and Freehold land), Plant and Machinery, Furniture and Fixtures, Office Equipments, Motor Car and Vehicles, Bore-Wells and Water Connections etc.

NOTES FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 31.03.2007

1. Contingent Liabilities not provided for in respect of:

	31.03.2007 (Rs. In Million)
(i) Letter of Credit outstanding	33.684
(ii) L.C. Margin Money with Bank	10.635
(iii) Bank Guarantee outstanding	88.990
(iv)Claims against the company not acknowledged as debts	1.394
(v) Corporate Guarantees given	68.950
Liability contested and not provided for:
- Excise / Custom demands under appeal	27.138
- Income Tax Demand under Appeal	1.519
- Sales-tax / Purchase tax/ Entry tax demand Amount paid under protest Rs.3.983 millions (P.Y. Rs.3.763 Millions)	13.243
- Provident Fund / E.S.I.C. demand	1.553
- Local Authorities demand	7.517
- Stamp duty demand under appeal	5.027
(vi) Uncalled liability on partly Paid up shares	0.075
(vii) Arrears of Dividend on 11% Redeemable Preference Shares	--

(viii) Warranty Claims and Performance Guarantees, wherever given, for the products of the Company, amount is not ascertainable.

(ix) Future liability if any, arising for non- fulfillment of export obligation on or before 31.03.2010 under Export Promotion Capital Goods Scheme; however there is no default to date.

 2. Estimated amount of Contracts remaining to be executed on Capital Account and not provided for Rs.130.976 Millions (Previous Year Rs.180.120 millions) (Net of advances)

3. There are Excise Refund Claims filed by the Company but not accepted by the Central Excise Authorities. The company has preferred appeals with the Central Excise Appellate Authorities and Hon’ble Mumbai High Court. In view of uncertainty of the claims, refunds will be accounted for on final decision by the Authorities/ Courts.

4. Custom duty on raw materials and finished goods in Bonded Warehouse amounting to Rs.6.249 Millions (Previous Year Rs.7.228 Millions) along with interest if any, has not been provided in the books of Accounts as the same is payable only at the time of clearance of the goods. The liability of the said amount not affect the profitability as well as the net current assets of the company.

5. (i) The future liability of gratuity payable in accordance with the Payment of Gratuity Act and the Company’s rules is estimated on Actuarial Valuation at Rs.49.242 Millions (Previous Year Rs.46.952 Millions) against which the company has an approved Gratuity Fund for its employees other than the employees of Textile Division, Engineering Division, Chemical Division, Speciality Chemical Division and Foundry Division where the liability to the extent of Rs.27.835 Millions (Previous year Rs.25.976 Millions). Shortfall in Gratuity Fund Account will be made good by the Company.

(ii) The future liabilities of gratuity payable in respect of employees of the Textile Division is estimated on Actuarial Valuation at Rs.15.449 Millions (Previous Year Rs.13.908 Millions) against which incremental gratuity liability of Rs.10.711 Millions (Previous Year 9.170 Millions) on accrual basis has been provided. However no provision has been made for the liability up to 30.06.1988 amounting Rs.4.738 Millions (Previous Year Rs.4.738 Millions) and will be accounted for as and when paid.

(iii) Provision for gratuity liability in respect of employees of the Pefco Foundry Division is covered under the Employees Group Gratuity Scheme of the Life Insurance Corporation of India. Payment in excess of the amount covered under the scheme is accounted for on due basis.

THE COMPANY IS IN TRADE TERMS WITH :

Ø Akshay Enterprises

Ø Khushboo Enterprises

Ø S. B. Engineers

Ø Durgman Engineering Company

Ø Quality Tubes and Cones Company

Ø Shree Ganesh Enterprises

Ø Om Engineers

Ø Amar Industries and Fine Chem

Ø Snam Alloys

Ø Amruta Industries

Ø Ahura Flux

Ø Ashwini Industries

Ø Shiv Shakti Engineers

Ø Mahalaxmi Enterprises

Ø Khushbu Enterprises

Ø Roltex Comp. Industries

Ø Pepega (IandP) Limited

Ø Quality Tubes and Cones Company

Ø Techno Craft

Ø Harish Enterprises

Ø Mrityunjay Engineering Works

Ø Amar Industries and Fine Chemical

Ø Soni Engineers

AS PER WEBSITE DETAILS:

KORES was established in the year 1932 in collaboration with an Austrian company.

They have branches all over India. Diversified in various fields such as

Ø Office Products

Ø Foundry

Ø Business Machines and Systems

Ø Office Automation

Ø Engineering

Ø Chemical

Ø Textile and Wires

The Annual Sales Turnover was @US $ 55 Million in 1996-97.

Ø KORES has collaborations with

Ø Mita Corporation, Japan

Ø Kliendienst Darentechnic GmbH, Germany

Ø George E. Faling CO., USA,

Ø Amox Division,

Ø Vbm Corporation, USA

Ø Generon Systems, USA

They cater to major Automobile, Refrigeration, Pumps, Valves, Locomotive and Construction industries in India and abroad.

CENTRIFUGAL CASTINGS:

Equipped with horizontal centrifugal casting machines from OD 200 mm to 500 mm and length upto 2.2 mtrs in Grey Iron, Alloy and Ductile Iron, Stainless steel and HR grades. Cylinder liners to any international standards or as per customer's specifications supplied duly - Chrome Plated, - Phosphated, or Nitrated. Pefco is first in India to indigenously develop locomotive cylinder liners to the specification of ALCO, USA with whom Indian Railways had collaboration.

DUCTILE IRON CASTINGS:

Produced to any international specifications catering to major automobile, refrigeration, compressor and engineering industries with weight ranging from 200 gms to 60 Kgs. each. Produced by Green sand, CO2 and Shell moulding facilities and supported by well equipped sand and metal laboratories. The present Product Range of Ductile Iron Castings are Steering Gear Box Housings, Suspension elements and Brackets,Brake Caliper and Carrier, Wheel Hubs for LCVs, MCVs and HCVs, Refrigeration Crank Shafts and Crank cases. These and many more engineering and automotive castings Supplied in Raw cast condition , proof and or fully machined condition on case to case basis.

VALVE TAPPETS:

Valve Tappets are made in 'Chilled' Cast Iron in shell moulds. They are ground finished to within 2 microns. Close tolerances on chilled depth are maintained. Tappets chilled on both cam as well as push rod side are also produced.

VALVE SEAT INSERTS:

Valve seat insert rings produced by centrifugal process to obtain closed grain dense structure assuring homogenous and sound castings. Rings conforming to customer specifications in various metal compositions are manufactured. Pefco is the first in India to indigenously develop valve seat inserts and valve tappets to the specification of Daimler Benz, Germany with whom M/s Telco had technical collaboration.

An ISO - 9002 company crepitated by Bureau Veritas Quality International. (Preparation for QS- 9000 accreditation undertaken)

A division of KORES (INDIA) Limited . Established in 1969. Situated in Pune, at the Bhosari Industrial Estate All the leading Automobile manufacturers, Railways and other Engineering Equipment manufactures are the customers of Pefco Foundry.

This Foundry is a front liner in centrifugal, shell and conventional castings in S G Iron, Cast Iron and Various Alloy Steels .

Capacity Per Annum

Ductile Iron castings - 6,000 Tons
Cylinder liners-10,000 Nos
Valve Seat Inserts- 12,00,000 Nos
Valve Tappets - 12,00,000 Nos

Enough Spare Capacity available

QUALITY POLICY : They at PEFCO Foundry are totally committed to manufacture products as per mutually agreed customer's specifications and maximise customer satisfaction.

An ISO - 9002 company a crepitated by Bureau Veritas Quality International.
( Preparation for QS- 9000 accreditation undertaken )

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.48.74
UK Pound	1	Rs.85.19
Euro	1	Rs.66.12

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	7
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	5
--RESERVES	1~10	5
--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	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		52

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

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

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

RATING EXPLANATIONS

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

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