MIRA INFORM REPORT

Report Date :

28.04.2011

IDENTIFICATION DETAILS

Name :	SATKUL ENTERPRISES LIMITED
Registered Office :	M-21, New Madhavpura Market, Shahibaug Road, Ahmedabad-380004, Gujarat, India
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	26.02.1999
Com. Reg. No.:	04-35510
CIN No.: [Company Identification No.]	U27209GJ1999PLC035510
TAN No.: [Tax Deduction & Collection Account No.]	AHMS00901F
PAN No.: [Permanent Account No.]	AADCS0453K
Legal Form :	Closely Held Public Limited Liability Company
Line of Business :	Trading of Welding Items.

RATING & COMMENTS

MIRA’s Rating :

Ba (45)

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Maximum Credit Limit :	USD 120000
Status :	Satisfactory
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is an established company having satisfactory track. Trade relations are reported as fair. Business is active. Payments are reported to be usually correct and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – April 1, 2010

Country Name	Previous Rating (31.12.2009)	Current Rating (01.04.2010)
India	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

INFORMATION PARTED BY

Name :	Mr. Satbir
Designation :	Director
Date :	26.04.2011

LOCATIONS

Registered Office :	M-21, New Madhavpura Market, Shahibaug Road, Ahmedabad – 380 004, Gujarat, India
Tel. No.:	91-79-25620552 / 30914735 / 26747130
Fax No.:	91-79-25620558
E-Mail :	sales@satkulwelding.com gshethwala@yahoo.com info@satkulwelding.com
Website :	http://www.satkulwelding.com
Location :	Owned
Factory 1:	Plot No 708, GIDC, N H 8A, Near Bavla, Kerala – 382220, India
Tel. No.:	91-2714-268439
E-Mail :	falcon@satkulwelding.com

DIRECTORS

As on 30.09.2010

Name :	Mr. Satbir Mohansingh Bagga
Designation :	Director
Address :	146, Azad Society, Ambawadi, Ahmedabad – 380015, Gujarat, India
Date of Birth/Age :	21.12.1981
Date of Appointment :	01.01.2006
Name :	Mr. Kulbir Mohansingh Bagga
Designation :	Director
Address :	146, Azad Society, Ambawadi, Ahmedabad – 380015, Gujarat, India
Date of Birth/Age :	16.04.1983
Date of Appointment :	01.05.2001
Name :	Ms. Manpreetkaur M Bagga
Designation :	Director
Address :	146, Azad Society, Ambawadi, Ahmedabad – 380015, Gujarat, India
Date of Birth/Age :	11.06.1986
Date of Appointment :	01.09.2006
Name :	Mr. Bharat Dasharatlal Dave
Designation :	Director
Address :	7/A, Shruti Kung Society – 2, Maninagar, Ahmedabad – 380050, Gujarat, India
Date of Birth/Age :	06.11.1948
Date of Appointment :	01.10.2009
Date of Ceasing :	31.05.2010
Name :	Mr. Mohanjitsingh S. Bagga
Designation :	Director
Address :	146, Azad Society, Ambawadi, Ahmedabad – 380015, Gujarat, India
Date of Birth/Age :	23.01.1956
Date of Appointment :	17.11.2009

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 30.09.2010

Names of Shareholders	No. of Shares
Mohanjitsingh Suratsingh Bagga	117140
Amarjitkaur Mohanjitsingh Bagga	1810
Satbirsingh Mohanjitsingh Bagga	40510
Kulbirsingh Mohanjitsingh Bagga	40510
Dilipkumar Taraji Prajapati	10
Harsha G Shethwala	10
Manpreetkaur M Bagga	10
Total	200000

Equity share breakup (percentage of total equity)

As on 30.09.2010

Category	Percentage
Directors or relatives of directors	100.00

BUSINESS DETAILS

Line of Business :	Trader of welding items.
Products :	· Welding Consumables · Cables of Superior Performance · Gas Cutting and Welding Equipments · Welding Rubber Hose Pipe
Imports :
Product :	Welding Consumable
Country :	· USA · South Korea · Italy · China
Terms :
Selling :	Credit (30 days)
Purchasing :	Credit (60 days)

GENERAL INFORMATION

Suppliers :

Chosm Welding Company Limited - Korea

Customers :

· Wholesalers

· End Users

· S.R. Steel Limited

· ABG Shipyard Limited

No. of Employees :

15 (Approximately)

Bankers :

· Bank of Baroda

S M Road, situated at 42, Tapovan Society, Near Manek baug Hall, Ahmedabad – 380015, Gujarat, India

· State Bank of India

o Madam Cama Road, Mumbai – 400 021, Maharashtra, India

o Specialised Commercial Branch, Gandhidham, Ahmedabad – 380 006, Gujarat, India

· Axis Bank Limited

· HDFC Bank Limited

Facilities :

Secured Loans	(As on 31.03.2010) Rs. in millions	(As on 31.03.2009) Rs. in millions
State Bank of India Cash Credit Account (Secured against hypothecation of stocks, book debts, collateral security and personal guarantee of directors)	17.882	22.311
Term Loan Secured against Hypothecation of Car
State Bank of India	0.057	0.135
Axis Bank Limited	0.267	0.534
State Bank of India	0.357	0.000
HDFC Bank Limited	0.000	0.146
Total	18.565	23.126

Unsecured Loans	(As on 31.03.2010) Rs. in millions	(As on 31.03.2009) Rs. in millions
Cholamandlam DBS Finance Limited	0.000	0.343
Loans from directors	7.599	3.492
Loans from Shareholders	1.089	2.295
Total	8.689	6.130

Banking Relations :	--
Auditors :
Name :	S Gaurang and Associates Chartered Accountants
Address :	313, Advait, Near Sandesh Press, Vastrapur, Ahmedabad – 380 054, Gujarat, India
Tele. No.:	91-79-40030043
Mobile No.:	91-9898074280

CAPITAL STRUCTURE

As on 31.03.2010

Authorised Capital :

No. of Shares	Type	Value	Amount
300000	Equity Shares	Rs.10/- each	Rs.3.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
200000	Equity Shares	Rs.10/- each	Rs.2.000 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2010	31.03.2009	31.03.2008
SHAREHOLDERS FUNDS
1] Share Capital		2.000	0.901	0.901
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		27.655	21.300	17.655
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		29.655	22.201	18.556
LOAN FUNDS
1] Secured Loans		18.565	23.126	19.609
2] Unsecured Loans		8.689	6.130	8.874
TOTAL BORROWING		27.254	29.256	28.483
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		56.909	51.457	47.039
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		7.251	4.391	2.325
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		0.000	0.000	0.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	36.676	29.194	20.577
	Sundry Debtors	27.113	21.862	31.074
	Cash & Bank Balances	1.100	1.456	3.126
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	6.500	4.129	3.267
Total Current Assets		71.389	56.641	58.044
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	15.824	6.196	5.660
	Other Current Liabilities	2.434	1.204	2.979
	Provisions	3.473	2.175	4.691
Total Current Liabilities		21.731	9.575	13.330
Net Current Assets		49.658	47.066	44.714
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		56.909	51.457	47.039

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Sales Less Goods Return	122.854	99.102	125.098
		Other Income	4.512	3.099	2.425
		TOTAL (A)	127.366	102.201	127.523
Less	EXPENSES
		Purchases Less Goods Return	87.168	73.293	76.191
		Custom Duty	18.777	18.194	27.451
		Clearing and Forwarding Expenses	1.584	0.758	1.006
		Freight, Cartage, Octroi Expenses	1.091	0.696	1.209
		Material Testing Charges	0.000	0.002	0.000
		Electrode Sample Expenses	0.000	0.000	0.104
		Sales Tax of Preceding year	0.016	0.016	0.031
		Administrative and Selling Expense	11.608	7.762	11.879
		Income Tax	0.000	0.000	0.005
		Fringe Benefit Tax	0.001	0.051	0.081
		Increase/ Decrease in Stock	(7.482)	(8.617)	(6.393)
		TOTAL (B)	112.763	92.155	111.564
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		14.603	10.046	15.959
Less	FINANCIAL EXPENSES (D)		3.977	3.546	3.680
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		10.626	6.500	12.279
Less/ Add	DEPRECIATION/ AMORTISATION (F)		0.920	0.812	0.350
	PROFIT BEFORE TAX (E-F) (G)		9.706	5.688	11.929
Less	TAX (H)		3.352	2.043	4.609
	PROFIT AFTER TAX (G-H) (I)		6.354	3.645	7.320
	Earnings Per Share (Rs.)		31.77	40.47	--

Particulars	31.03.2011
Sales Turnover (Approximately)	130.000

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	4.98	3.57	5.74
Net Profit Margin (PBT/Sales)	(%)	2.96	5.74	9.54
Return on Total Assets (PBT/Total Assets}	(%)	12.34	9.32	19.76
Return on Investment (ROI) (PBT/Networth)		0.32	0.26	0.64
Debt Equity Ratio (Total Liability/Networth)		1.65	1.75	2.25
Current Ratio (Current Asset/Current Liability)		3.28	5.92	4.35

LOCAL AGENCY FURTHER INFORMATION

Note:

The Register Office of the company has been shifted from 146, Azad Soceity, Ambawadi, Ahmedabad-380015, Gujarat, India to present address.

Form : 8

Bankers Charges Report as per Registry

Name of the company	SATKUL ENTERPRISES LIMITED
Presented By	MR MOHANJITSINGH BAGGA
1) Date and description of instrument creating the change	Hypothecation agreement executed on 02.02.2005
2) Amount secured by the charge/amount owing on the securities of charge	Rs 4.000 Millions
3) Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given	Hypothecation of stocks including all kinds of welding consumables both present and future and book debts.
4) Gist of the terms and conditions and extent and operation of the charge.	The facility of Rs 4.000 Millions is given under Cash Credit Account repayable on demand. Margin on stocks is @ 30% and Book Debts is @ 50% The cash credit facility is secured by hypothecation of stocks, including all kinds of welding consumables, machine lying in the godown of the company and the book debts. Interest will be charged on loan @ 12.50 % p.a. on monthly basis. Penal Interest @ 2% shall be charged for default irregularity
5) Name and Address and description of the person entitled to the charge.	Bank of Baroda S M Road, situated at 42, Tapovan Society, Near Manek baug Hall, Ahmedabad – 380015
6) Date and brief description of instrument modifying the charge	NA
7) Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.	NA

Corporate identity number of the company	U27209GJ1999PLC035510
Name of the company	SATKUL ENTERPRISES LIMITED
Address of the registered office or of the principal place of business in India of the company	M-21, New Madhavpura Market, Shahibaug Road, Ahmadabad - 380004, Gujarat, India
This form is for	Modification of charge
Type of charge	Book debts Movable property (not being pledge) Floating charge
Particular of charge holder	State Bank of India, Laghu Udhyog Branch, Opp. Gandhgram Rly. Station, Ahmadabad – 380009 , Gujarat, INDIA
Nature of instrument creating charge	(a) Supplemental agreement of loan cum Hypothecation (SME-4),dated 16.09.2010 (b) Letter of arrangement (SME-1)
Date of instrument Creating the charge	16/09/2010
Amount secured by the charge	Rs. 36.800 millions
Brief of the principal terms an conditions and extent and operation of the charge	Rate of interest Interest @4.00% above base rate (BR=7.50% w.e.f.01.07.2010) with minimum of 11.50% p.a. Present effective rate is 11.50% p.a. calculated on daily products with monthly rests. Terms of repayment Repayable on demand. Margin Stock of trade - 25% Domestic receivables (cover period 90 days) - 40% Letters of credit - 15% Bank guarantee - 15% Extent and operation of the charge The existing credit facilities enhanced to Rs.36.800 millions secured by first charge by way of hypothecation of entire current assets including stock in trade, finished goods, Consumable stores and spares, Bills/Book debts/Receivables and other current assets of the company. Other terms and Conditions as per letter of arrangement enclosed herewith Other Individual limits within overall limit as under : (i) Cash credit (stocks and Book debts)-Rs.36.800 millions (ii) Letter of credit -Rs.(3.000) millions making overall aggregate total credit facilities of Rs. 36.800 millions
Short particulars of the property charged (Including location of the property)	Hypothecation of entire current assets including stock in trade, finished goods, Consumable stores and spares, Bills/Book debts/Receivables and other current assets of the company.
Particulars of the present modification	The original charge (ID No.10061927) created on dated 21.06.2007 for Rs.23.400 millions is now being modified by supplemental agreement of loan cum hypothecation executed on dated 16.09.2010 and enhanced to Rs.36.800 millions as under (i) Cash credit (stocks and Book debts)-Rs.36.800 millions (ii) Letter of credit -Rs.(3.000) millions Now, the amount of charge by way of hypothecation extend to aggregate of Rs.36.800 millions

Fixed Assets

· Motor Cars

· Office Equipments

· Office Building

· Trolley

· Water Purifier

· Computer

· Furniture and Fixtures

· Scooter and Bike

Web Details

Profile

Subject is a pioneer company in offering the best quality products in welding consumables since 1976. The company uses innovative combination of Quality and Service in its way to achieve position of par excellence in its path of progress. They identify the services customers value the most and their relative importance. The Goal is to focus from gaining a market share to a focus on building customer share. The group has represented almost all the reputed brands of India as a Distributor and since 1995 they are representing various Asian and European companies. The quality and reliability offered by the product has earned the company a great rapport.

With customer's support and increasing demand for the product in the market they are now marching ahead with an aim of high quality service to the valuable customers, taking the company to new heights of customer satisfaction.

Subject is adept at building customers not just products.

Marching ahead on the path of success and glory the manufacturing firm FALCON CABLES PRIVATE LIMITED is offering the industries the best quality Welding Cables since 1994.

To serve the quality product at the demand of the customer they under brand name FALCON have added relative products like welding hose pipes, torches and regulators in the manufacturing list which is qualitatively most welcomed by the valued customers.

They import and stock Nickel, Cobalt, Aluminum, Copper alloys, unalloyed, low alloy creep resistant, maintenance electrodes and wires of renowned brands.

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. 44.40
UK Pound	1	Rs. 73.26
Euro	1	Rs. 65.17

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
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	NO
--AFFILIATION	YES/NO	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		45

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	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
-	NB	New Business	-

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

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.