MIRA INFORM REPORT

Report Date :

18.10.2008

IDENTIFICATION DETAILS

Name :	AIRCEL CELLULAR LIMITED
Formerly Known As :	RPG CELLULAR SERVICES LIMITED
Registered Office :	5^th Floor, Spencer Plaza, 769 Anna Salai, Chennai-600 002, Tamilnadu
Country :	India
Financials (as on) :	31.12.2006
Date of Incorporation :	21.02.1992
Com. Reg. No.:	18-39395
CIN No.: [Company Identification No.]	U74999TN1992PLC039395
TAN No.: (Tax Deduction & Collection Account No.)	CHEM01710C
PAN No.: (Permanent Account No.)	AAACR5136R
Legal Form :	A closely held public limited liability Company.
Line of Business :	Service Provider of Cellular, Paging, V-SAT and E-Mail

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 9900000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	The company has improved it’s performance by wiping out it’s all previous losses. Directors are reported as experienced, respectable and resourceful businessmen. Their trade relations are fair. Financial position is good. Payments are usually correct and as per commitments. The company can be considered good for any normal business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	No. 301 (Old No.193), Poonamallee High Road, Kilpauk, Chennai - 600 010, Tamil Nadu, India
Tel. No.:	91-44-25324141
Fax No.:	91-44-25323131
Head Office :	5^th Floor, Spencer Plaza, 769 Anna Salai, Chennai-600 002, Tamilnadu, India
Tel. No.:	91-44-28490849
Fax No.:	91-44-28946769/28496769
E-Mail :	response@mobilefirst.org Vijay.krishna@aircel.co.in Ananthalakshmi.subramanian@aircel.co.in
Website :	http://www.rpgcellular.com http://www.aircel.co.in
Branch Office :	Located at : Coimbatore Madurai Pondicherry Salem Trichy

DIRECTORS

Name :	Mr. V Srinivasan
Designation :	Director
Address :	Flat 2-B, KG Central Court, 9-11. Jagadambal, Street, T. Nagar, Chennai, Tamilnadu 600017
Date of Birth/Age :	15.05.1957
Date of Appointment :	19.12.2003
Name :	Mr. KVP Baskaran
Designation :	Whole Time Director
Address :	Nathan Akshaya 37-D, Unnamalalii Amman Street, North USMAN Road, T. Nagar, Chennai, Tamilnadu: 600017
Date of Birth/Age :	21.07.1961
Date of Appointment :	19.12.2003
Name :	Mr. Sriram Chandrasekar
Designation :	Director
Address :	B-1, Sai Krupa Apartments, 2^nd Floor, No.5, Sundar Am Salai Ra, Puram Chennai Tamilnadu 600028
Date of Birth/Age :	05.06.1966
Date of Appointment :	19.01.2005
Name :	Mr. Rohit Chandra
Designation :	Director
Address :	3/10, Shanti Niketan, New Delhi 110021
Date of Birth/Age :	09.07.1964
Date of Appointment :	19.01.2005
Name :	Mr. Ashok Srinivasan
Designation :	Director
Address :	Sterling Tower, 327, Anna Salai, Teynampet Chennai Tamilnadu 600006
Date of Birth/Age :	21.07.1977
Date of Appointment :	19.12.2003
Name :	Mr. R Vijayakakri Shnan
Designation :	Secretary
Address :	66-C, Padmavathy Nagar Virugambakkam, Chennai, Tamilnadu 600092
Date of Birth/Age :	19.06.1976
Date of Appointment :	12.04.2004
Name :	Mr. Chin Chun Yean
Designation :	Director
Address :	30 Jalan Buluh, Perindu, Taman Sa, Bukit Damansara, Kuala Lumpur:59000
Date of Birth/Age :	07.01.1994
Date of Appointment :	02.09.2006
Other Directorship :	Aircel Limited U32201TN1994PLC029608 Dishnet Wireless Limited U74999TN1998PLC040075
Name :	Mr. KP Rangaraj
Designation :	Manager
Address :	8, Masilamani Colony, Mylapore, Chennai – 600004, Tamilnadu, India
Date of Birth/Age :	21.07.1965
Date of Appointment :	02.09.2006
Name :	Mr. Chan Chee Beng
Designation :	Director
Address :	3 JLN TR 6/1, Tropicana Golf and Country Club, Petaling Jaya 47410, Malaysia cbchan@ut.com.my
Date of Birth/Age :	23.08.1955
Date of Appointment :	06.01.2006

KEY EXECUTIVES

Name :	Mr. Ananthalakshmi Subramanian
Designation :	Secretary
Address :	Raman Apartment 4G, KG Srivatsa Garden, 9/6, South Avenue, Srinagar Colony, Saidapet, Chennai – 600015, Tamilnadu, India Ananthalakshmi.subramanian@aircel.co.in
Date of Birth/Age :	01.01.1982
Date of Appointment :	14.03.2007
Audit Committee Members:
Name :	Mr. V Srinivasan
Designation :	Chairman
Name :	Mr. KVP Baskaran
Designation :	Director
Name :	Mr. Sriram Chandrasekar
Designation :	Director
Name :	Mr. Rohit Chandra
Designation :	Director
Name :	Mr. R Vijayakrishnan
Designation :	Company Secretary

MAJOR SHAREHOLDERS

Names of Shareholders	No. of Equity Shares
Aircel Televentures Limited	48999940
Mr. V .Srinivasa	10
Mr. R .Narayan Kumar	10
Mr. M. Suresh	10
Mr. R. Mahesh	10
Mr. KVP Baskaran	10
Mr. V. Navneeth	10
TOTAL	49000000
Names of Shareholders	No. of Preference Shares
Infrastructure Leasing and Financial Service Limited	300
Equity Share Breakup
Category	Percentage of Holding
Bodies corporate	100.00

BUSINESS DETAILS

Line of Business :	Service Provider of Cellular, Paging, V-SAT and E-Mail
Products :	Provision of Cellular Mobile Telephone Services

GENERAL INFORMATION

Customers :	Retailers End Users
No. of Employees :	Around 2500
Bankers :	Punjab National Bank 17 Rajaji Salai, Chennai-600 001, Tamilnadu, India Development Credit Bank Limited Canara Bank, 781-785, Rayala Towers, Chennai – 600002, Tamilnadu, India Industrial Development Bank of India Limited IDBI Towertc Complex, Cuffe Parade, Mumbai – 400005, Maharashtra, India State Bank of India Leather and International Branch, MVJ Towers 177/1, Poonamelee high Road, Kilpauk, Chennai 600 010
Banking Relations :	Satisfactory
Auditors :
Name :	Price Waterhouse Chartered Accountant
Address :	32, Khader Nawaz Khan Road, Nungambakkam Chennai Tamilnadu – 600006
Associates :	Fresh and Honest Café Limited
Subsidiaries :	Aircel Limited U32201TN1994PLC029608 Dishnet Wireless Limited U74999TN1998PLC040075
Ultimate Holding Company :	Sterling Infotech Limited
Holding Company :	Aircel Televentures Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
50000000	Equity shares	Rs.10/- (each)	Rs.500.000 millions
600000	Redeemable Cumulative Preference Shares	Rs.100/- (each)	Rs.60.000 millions
	Total		Rs.560.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
49000000	Equity shares	Rs.10/-(each)	Rs.490.000 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.12.2006 [9Months]	31.03.2006 [12Months]	31.03.2005 [12Months]
SHAREHOLDERS FUNDS
1] Share Capital		490.000	490.000	490.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		1990.099	1270.378	545.700
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		2480.099	1760.378	1035.700
LOAN FUNDS
1] Secured Loans		1018.669	721.469	885.000
2] Unsecured Loans		0.000	0.000	100.000
TOTAL BORROWING		1018.669	721.469	985.000
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		3498.768	2481.847	2020.700
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		2156.491	1990.921	1980.500
Capital work-in-progress		1344.408	433.686	0.000
INVESTMENT		0.000	0.000	0.000
DEFERREX TAX ASSETS		33.917	75.571	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	8.112	6.054	3.400
	Sundry Debtors	284.359	207.520	166.900
	Cash & Bank Balances	1393.866	848.957	205.600
	Other Current Assets	20.348	10.783	2.583
	Loans & Advances	362.322	210.431	227.500
Total Current Assets		2069.007	1283.745	603.400
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	2052.453	1271.130	560.800
	Provisions	52.602	30.946	2.400
Total Current Liabilities		2105.055	1302.076	563.200
Net Current Assets		[36.048]	[18.331]	40.200
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		3498.768	2481.847	2020.700

PROFIT & LOSS ACCOUNT

PARTICULARS		31.12.2006 [9Months]	31.03.2006 [12Months]	31.03.2005 [12Months]
Sales Turnover		2807.189	2876.606	2158.091
Other Income		53.905	27.322	0.840
Total Income		2861.094	2903.928	2158.931
Profit/(Loss) Before Tax		865.327	828.770	241.067
Provision for Taxation		144.508	104.080	0.000
Profit/(Loss) After Tax		720.819	724.690	241.067
Earnings in Foreign Currency :
	Export Earnings	NA	116.388	NA
Total Earnings		NA	116.388	NA
Expenditures :
	Purchases made for re-sale	14.471	20.432	25.548
	Salaries, Wages, Bonus, etc.	57.109	47.935	43.458
	Payment to Auditors	3.802	0.903	0.400
	Interest	105.894	114.077	112.720
	Insurance Expenses	1.069	1.511	3.252
	Power & Fuel	66.638	70.543	54.782
	Depreciation & Amortization	290.974	309.010	380.220
	Other Expenditure	1455.810	1510.747	1297.484
Total Expenditure		1995.767	2075.158	1917.864

KEY RATIOS

PARTICULARS		31.12.2006 [9Months]	31.03.2006 [12Months]	31.03.2005 [12Months]
PAT / Total Income	(%)	25.19	24.96	11.17
Net Profit Margin (PBT/Sales)	(%)	30.83	28.81	11.17
Return on Total Assets (PBT/Total Assets}	(%)	20.48	25.31	9.33
Return on Investment (ROI) (PBT/Networth)		0.35	0.47	0.23
Debt Equity Ratio (Total Liability/Networth)		1.26	1.15	1.49
Current Ratio (Current Asset/Current Liability)		0.98	0.99	1.07

LOCAL AGENCY FURTHER INFORMATION

FORM 8:-

Name of the company	AIRCEL CELLULAR LIMITED
Presented By	R Vijaykrishnan, Company Secretary
1) Date and description of instrument creating the change	17^th October 2005 Deed of Hypothecation executed by the Company in favour of State Bank of India (SBI) [a certificate copy of the said Deeds of Hypothecation is enclosed]
2) Amount secured by the charge/amount owing on the securities of charge	Corporate Loan facility of Rs.700.000 Millions Agreed to be granted by SBI to the Company together with interest, discount, commission, charges and costs and by SBI in terms of the said Agreement, both dated the Seventeenth day of October 2005 between the Company of the one part and SBI of the other part.
3) Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given	The whole of the movable properties of the Company including charge on all movable plant and machinery, both present and future belonging to or in the possessions or under the control of the Borrower, wherever lying, stored and kept and whether in the possession of the Borrower or of the Bank or of any third party, whether in India or elsewhere throughout the world (including all such goods, other, movable assets as may be in course of shipments, transit or delivery). However and wheresover in the possession of the Borrower and either by way of Substitution or addition.
4) Gist of the terms and conditions and extent and operation of the charge.	(A) the Charge operates as security, inter alia, for repayment of the Corporate Loan Facility of Rs. 700.000 Millions, agreed to be granted by SBI to the Company together with interest discount, commission, charges and costs and expenses, if any, payable by the Company to SBI in terms of the said Hypothecation and the facility Agreement both dated the Seventeenth day of October 2005 between the Company of the one part and SBI of the other part. (B) The Company has undertaken to keep the goods hypothecated in marketable and goods hypothecated in marketable and goods condition at its own cost and to insure the same in the joint names(along with other pari-passu lenders) of the Company and SBI. (C) The security created under the said Deed of Hypothecation is to be a continuing security. (D) The Charge shall rank pari-passu with the charge created to/ be created by the Company in favour of all existing first charge (pari-passu) holders of the Company. (E) The Charge shall also be exclusive of the charge held by canara Bank for their USD 3.22 million Letter of Credit facility for which Canara Bank hold exclusive first charge on the assets to procured under the said facilities.
5) Name and Address and description of the person entitled to the charge.	State Bank of India Leather and international Branch MVJ Towers 177/1, Poonamelee high Road Kilpauk, Chennai 600 010

This form is for	Modification of charge
Charge identification number of the charge to be modified	80008544
Corporate identity number of the company	U74999TN1997PLC039395
Name of the company	AIRCEL CELLULAR LIMITED
Address of the registered office or of the principal place of business in India of the company	769, Anna Salai Chennai – 600002, Tamilnadu, India
Type of charge	Immovable Property Book Debts Movable Property Floating charge
Particular of charge holder	Industrial Development Bank of India Limited IDBI Tower WTC Complex Cuffe Parade, Mumbai – 400005, Maharashtra, India r.ganesh@idbi.co.in
Nature of description of the instrument creating or modifying the charge	Indenture of Mortgage dated 27.07.2006. Mortgage created in respect of the company’s immovable freehold property situated in 3^rd floor and 5^th floor of Spencer Plaza, Anna Salai, Chennai, State of Tamilnadu, India
Date of instrument Creating the charge	27.07.2006
Amount secured by the charge	Rs. 850.000 Millions
Brief particulars of the principal terms an conditions and extent and operation of the charge	Rate of Interest Not applicable. Usance Interest of credit facility would be payable to the vendor directly. However in case of availment of stand-by Demand Loan forming part of the overall facility, the interest would be IDBI Minimum Term Lending rate prevailing at the time of disbursement + 300 bps. Terms of repayment As described in the loan agreement entered into between the company and Industrial Development Bank of India Limited. Margin Usance Interest : to be paid quarterly in advance Principal Amount 10 % on or before opening of the letter of credit Additional 15 % at the end of 12^th, 18^th, 24^th, 30^th month and 30 % at the end of 35^th month from the date of opening of the letters of credit.
Date of latest modification prior to the present modification	25.07.2006

Fixed Assets

• Land
• Building
• Plant and Machinery
• Furniture and Fixture
• Office and Other Equipments
• Vehicles
• License fees

AS PER WEBSITE

Company Profile

Subject is now a proud part of Maxis, an international conglomerate and the leading cellular service provider in Malaysia with over 7 million subscribers and a firm commitment to providing seamless connectivity and superior technology to every customer. A recipient of multiple accolades, Maxis has been deemed as the brand of the year 2006 in Malaysia.

Subject is rapidly spreading across the state of Tamilnadu with connectivity in 1000 towns and 11,000 villages, serving over 50 lakh happy subscribers. Known for its superior tariff offering and cutting-edge technology, Subject has recently been honoured as the No.1 operator across all metro circles for customer satisfaction by Voice and Data magazine’s survey in 2006. Currently, Subject has a marked presence in the North and North East circles of the country including Rest of West Bengal, Orissa, Sikkim, Manipur, Jammu and Kashmir, Himachal Pradesh and Bihar. With 13 new circles to be operational soon, Subject will be a Pan-India operator very shortly.

Putting customers first, subject offers exclusive Customer Service teams and corporate Account Managers that work round- the-clock to provide the finest service and the best mobile experience ever.

The Aircel Group is a joint venture between Maxis Communications Berhad of Malaysia and Apollo Hospital Enterprise Ltd of India, with Maxis Communications holding a majority stake of 74%.

Subject commenced operations in 1999 and became the leading mobile operator in Tamil Nadu within 18 months. In December 2003, it launched commercially in Chennai and quickly established itself as a market leader – a position it has held since.

Subject began its outward expansion in 2005 and met with unprecedented success in the Eastern frontier circles. It emerged a market leader in Assam and in the North Eastern provinces within 18 months of operations. During this period, the company gained a foothold in 9 circles including Chennai, Tamil Nadu, Assam, North East, Orissa, Bihar, Jammu and Kashmir, Himachal Pradesh and West Bengal.

The Company has currently gained a momentum in the space of telecom in India post the allocation of additional spectrum by the Department of Telecom, Govt. of India for 13 new circles across India. These include Delhi (Metro), Mumbai (Metro), Andhra Pradesh, Gujarat, Haryana, Karnataka, Kerala, Madhya Pradesh, Maharashtra and Goa, Rajasthan, Punjab, UP (West) and UP (East).

Subject has won many awards and recognitions. Voice and Data gave Subject the highest rating for overall customer satisfaction and network quality in 2006. Subject emerged as the top mid-size utility company in Businessworld’s ‘List of Best Mid-Size Companies’ in 2007. Additionally, Tele.net recognised Subject as the best regional operator in 2008.

With over 10 million customers in the country, Subject is the fastest growing telecom company in India, has revved up plans to become a full-fledged national operator by 2009.

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 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.48.68
UK Pound	1	Rs.84.37
Euro	1	Rs.65.70

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	5
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	5
--CREDIT LINES	1~10	5
--MARGINS	-5~5
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		46

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

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