MIRA INFORM REPORT

Report Date :

16.08.2011

IDENTIFICATION DETAILS

Name :	VALLABHDAS KANJI LIMITED
Registered Office :	19/119, Beach Road, Alleppey – 688012, Kerala
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	26.10.1942
Com. Reg. No.:	09-1301
Capital Investment / Paid-up Capital :	Rs.690.574 Millions
CIN No.: [Company Identification No.]	U51109KL1942PLC001301
TAN No.: [Tax Deduction & Collection Account No.]	CHNV00527C
PAN No.: [Permanent Account No.]	AAACV656IE
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	The company is engaged in as Processor of Spice and Spice Ingredients.
No. of Employees :	700 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

B (35)

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Maximum Credit Limit :	USD 2400000
Status :	Moderate
Payment Behaviour :	Slow
Litigation :	Clear
Comments :	Subject is a well established company having moderate track. Profitability of the company is under pressure. There appears some accumulated losses recorded by the company. However, trade relations are reported as fair. Business is active. Payments are reported to be slow. The company can be considered for business dealings with some cautions.

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

LOCATIONS

Registered Office :	19/119, Beach Road, Alleppey – 688012, Kerala, India
Tel. No.:	91-477-3258561/ 2242233
Fax No.:	91-477-2243111
E-Mail :	sunil.sankar@vklspices.com contact@vklspices.com cs@vklspices.com
Website :	http://www.vklspices.com
Corporate Office :	Plot No.47, Bristow Road, W. Island, Kochi – 682003, Keral, India
Tel. No.:	91-484-3077777/ 78/ 79
Fax No.:	91-484-3077781
Factory :	9/102, Varikholi PO Puthencraz, Ernalulam, Kerala, India
Separate Products Segments :	VKL Spices and Seasonings XII/ 136A, Kundannoor - Maradu Road, Maradu P.O., Kochi-682304, Kerala, India. Tel : 91-484-3077777, 3077778, 3077779 Fax: 91-484-3077781 E-mail: seasonings@vklspices.com vkl@vklspices.com VKL Private Label XII/ 136A, Kundannoor - Maradu Road, Maradu P.O., Kochi-682304, Kerala, India. Tel : 91-484-3077777, 3077778, 3077779 Fax: 91-484-3077781 E-mail: seasonings@vklspices.com VKL Gift Business XII/136A, Kundannoor - Maradu Road, Maradu P.O. Kochi-682 304, Kerala, India. Tel : 91-484-3077777, 3077778, 3077779 Fax: 91-484-3077781 E-mail: seasonings@vklspices.com VKL Flavors and Fragrances A-401, TTC Industrial Area, Mahape MIDC, Thane-Belapur Road, Navi Mumbai - 400 705, Maharashtra, India Tel : 91-22-40764600/40764601 Fax: 91-22-40764605 E-mail: flavors@vklspices.com V. Spice Inc., USA Contact Person: Mr. Wouter Weening V.Spice Inc., 550 Mountain Avenue Gillette, NJ 07933, U.S.A. Tel: 001-908-903-9090 Fax: 001-908-464-5848 E-mail: vklusa@vklspices.com VKL Europe GmbH Contact Person: Mr. Uwe Scherbaum, VKL Europe GmbH, Am Pfaedlein 997702, Muennerstadt, Germany Tel: 0049 97 66 940 381 Fax: 0049 97 66 940 383 E-mail : vklgermany@vklspices.com

DIRECTORS

As on 30.09.2010

Name :	Mr. Ajay Jayasinh Mariwala
Designation :	Managing Director
Address :	Zaver Cochin Yatch Club Enclave 26/UA 592A, Thevara, Kochi, Ernakulam – 682013, Kerala, India
Date of Birth/Age :	24.10.1963
Date of Appointment :	01.03.1995
Name :	Mr. Jayasinh Vallabhdas Mariwala
Designation :	Director
Address :	Sudhakunj 3, Tardeo Road, Mumbai – 400034, Maharashtra, India
Date of Birth/Age :	09.07.1933
Date of Appointment :	19.06.1963
Name :	Mr. Sanjay Jayasinh Mariwala
Designation :	Director
Address :	XXVI/4515, E9, Willingdon Enclave, P K Road, Thevara, Kochi, Ernakulam – 682013, Kerala, India
Date of Birth/Age :	02.01.1960
Date of Appointment :	15.12.1993
Name :	Mr. Mohan Jayasinh Mariwala
Designation :	Director
Address :	Sudhakunj 3, Tardeo Road, Mumbai – 400034, Maharashtra, India
Date of Birth/Age :	08.08.1967
Date of Appointment :	28.09.2007
Name :	Mr. Sunil Kolangara Kumar
Designation :	Director
Address :	A-301, Kumaradhara, National Games Village, Bangalore – 560047, Karnataka, India
Date of Birth/Age :	23.09.1966
Date of Appointment :	19.09.2009
Nominee Company :	UTI Venture Funds Management Company Private Limited
Name :	Mr. Anil Kevin Khatod
Designation :	Director
Address :	8560 Saint Marlo, Fairway Drive, Duluth – 30097, Georgia
Date of Birth/Age :	18.07.1956
Date of Appointment :	28.01.2008

KEY EXECUTIVES

Name :	Mr. Sunil Sankar P.
Designation :	Company Secretary
Address :	Chaithram, Canal Road, Tripunithura, Ernakulam – 682301, Kerala, India
Date of Birth/Age :	18.05.1979
Date of Appointment :	06.09.2007

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 30.09.2010

Names of Shareholders	No. of Shares (Equity)
Jayasinh Vallabhdas Mariwala	10000
Sanjay Jayasinh Mariwala	10000
Nandna S. Mariwala	10000
Anila J. Mariwala	10000
Ajay Jayasinh Mariwala	440244
Mohan Jayasinh Mariwala	10000
Anuja Mariwala	10000
Madhvi M. Mariwala	10000
SJM Finance and Investments Private Limited, India	3420000
Unit Trust of India Investments Advisory Services Limited, India – Ascent India Fund, India	100000
Naranjee Hirjee and Company LLC, Oman	291700
Argonaut Ventures, Mauritius	10000
ICP Holdings I, Mauritius	100
Ajay J Mariwala	3054535
Jayasinh V Mariwala	365465
Names of Shareholders	No. of Shares (Preference)
Unit Trust of India Investment Advisory Services Limited, India – Ascent India Fund, India	249000
Argonaut Ventures, Mauritius	298285
ICP Holdings I, Mauritius	99969
Total	647254

As on 30.09.2010

Equity Share Break up (Percentage of Total Equity)

Category	Percentage
Ventures Capital	2.31
Foreign holdings( Foreign institutional investor(s), Foreign companie(s) Foreign financial institution(s), Non-resident Indian(s) or Overseas Corporate bodies or Others	6.97
Bodies corporate	78.95
Directors or relatives of Directors	11.77
Total	100.00

BUSINESS DETAILS

Line of Business :

The company is engaged in as Processor of Spice and Spice Ingredients.

Products :

Products Description	Item Code No.
Bulk Spices	09105000
Seasonings	00002103
Food Ingredients	21069060

PRODUCTION STATUS (As on 31.03.2010)

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
Pepper	MT	NA	7500	3156.51
Chilly	MT	NA	7100	2599.00
Tumeric	MT	NA	3000	778.27
Ginger	MT	NA	800	341.19
Seasonings and Flavours	MT	NA	2300	2482.66
Others		NA	1500	737.40

GENERAL INFORMATION

No. of Employees :

700 (Approximately)

Bankers :

· Union Bank of India, Overseas Branch, M G Road, Ernakulam – 682035, Kerala, India

· The Federal Bank Limited, Mullakkal, alleppey, Kerala, India

· Axis Bank Limited

· Standard Chartered Bank

Facilities :

Secured Loan	As on 31.03.2010 (Rs. in Millions)	As on 31.03.2009 (Rs. in Millions)
From Bank
Term Loan	283.612	357.495
Interest accrued and due	1.852	3.035
Packing Credit	645.864	515.700
Bill Discounting	9.818	0.000
Working Capital Demand Loans	69.929	27.566
Interest accrued and due	0.000	0.297
Total	1011.075	904.093
Unsecured Loan	As on 31.03.2010 (Rs. in Millions)	As on 31.03.2009 (Rs. in Millions)
Industrial Development Bank of India (IDBI)	50.000	50.000
Inter corporate Deposit	2.500	50.000
Spicos Board, Government of India	8.000	0.000
Total	60.500	100.000

DETAILS OF SECURITY

• Term Loans from Union Bank of India, Federal Bank and Axis Bank are secured by First charge on all fixed assets of the company including mortgaged properties on paripassu basis, second charge on all current assets of the company on paripassu basis, Personal Guarantee of four directors and Corporate Guarantee of Meher Properties Private Limited.

• Working Capital Loans from Union Bank of India, Federal Bank, Axis Bank and Standard Chartered Bank are secured by First charge on paripasu basis on whole of the Current Assets of the borrower namely, stocks of Raw materials like chilly, pepper, turmeric, ginger, nutmeg, cumin, coriander, fennel, fenugreek, white pepper, cloves, cardamom, celery, Stock – in progress, semi finished and finished goods, stores and spares, Bills Receivable, Book Debts and all other movables, both present and future lying loose or stored in or be stored or be in or about of Company’s factories, premises and godowns situated at Alleppey in the state of Kerala or wherever the same may be or be held by any party to the order or disposition of the Company or in the course of transit or on high seas or on order or delivery, however and whosesoever in the possession of the Company and either by way of substitution or addition and Paripassu second charge on entire present and future fixed assets of the Company (except Vehicle) by way of collateral security.

• The liability on finance lease obligation is secured by way of hypothecation of assets bought under the scheme.
• Term Loans repayable within one year Rs.29.677 Millions.
• Unsecured loans repayable within one year: Rs.100.000 Millions

Banking Relations :	--
Auditors :
Name :	Deloitte Haskins and Sells Chartered Accountant
Address :	Willmont Park Busienss Center, First Floor, Warriam Road, Kochi – 682016, Kerala, India
PAN.:	AACFD3771D
Holding Company :	SJM Finance and Investments Private Limited, India U65929KL1995PTC008590
Subsidiaries :	· Malabar Spices Company Limited U15495KL1997PLC011704 · Red Peppers Limited U51225KL2000PLC014152 · Complete Spice Solutions India Limited U51225KL2003PLC016005 · V Spice Inc. · VKL Europe Gmbh · VKL Vietnam Limited
Fellow Subsidiary :	· AJM Finance and Investment Private Limited · Kancor Flavours and Extracts Limited

CAPITAL STRUCTURE

As on 30.09.2010

Authorised Capital :

No. of Shares	Type	Value	Amount
10000000	Equity Share	Rs.10/- each	Rs.100.000 Millions
650000	Preference Shares	Rs.1000/- each	Rs.650.000 Millions
	Total		Rs.750.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
4332044	Equity Share (Of the above 3,420,000 shares are held by SJM Finance and Investments (Private) Limited, the Holding Company)	Rs.10/- each	Rs.43.320 Millions
647254	Preference Shares	Rs.1000/- each	Rs.647.254 Millions
	Total		Rs.690.574 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		690.574	690.574	589.219
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		126.443	254.072	350.727
4] (Accumulated Losses)		(214.464)	0.000	0.000
NETWORTH		602.553	944.646	939.946
LOAN FUNDS
1] Secured Loans		1011.075	904.093	695.959
2] Unsecured Loans		60.500	100.000	30.050
TOTAL BORROWING		1071.575	1004.093	726.009
DEFERRED TAX LIABILITIES		0.000	0.000	33.667
Finance Lease Obligation		2.454	3.308	4.875
TOTAL		1676.582	1952.047	1704.497
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		514.692	513.642	398.027
Capital work-in-progress		6.600	31.484	53.523
INVESTMENT		83.524	62.382	62.383
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	926.699	938.702	867.860
	Sundry Debtors	139.874	198.867	228.400
	Cash & Bank Balances	171.069	231.026	247.728
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	390.342	504.733	328.295
Total Current Assets		1627.984	1873.328	1672.283
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditor	425.438	463.034	413.581
	Other Current Liabilities	119.998	34.798	24.589
	Provisions	10.782	30.957	43.549
Total Current Liabilities		556.218	528.789	481.719
Net Current Assets		1071.766	1344.539	1190.564
MISCELLANEOUS EXPENSES			0.000	0.000
		1676.582
TOTAL		1676.582	1952.047	1704.497

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Income	2028.833	2067.867	1601.001
		Other Income	2.013	3.967	16.469
		TOTAL (A)	2030.846	2071.834	1617.470
Less	EXPENSES
		Increase in finished Goods and Work in Process	(10.651)	(41.458)	(215.332)
		Manufacturing and Other Expenses	2190.303	1904.888	1706.722
		Exceptional Items	(19.378)	227.866	(55.850)
		TOTAL (B)	2160.274	2091.296	1435.540
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		(129.428)	(19.462)	181.931
Less	FINANCIAL EXPENSES (D)		154.143	101.990	72.799
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		(283.571)	(121.452)	109.132
Less/ Add	DEPRECIATION/ AMORTISATION (F)		48.343	42.165	38.410
	PROFIT BEFORE TAX (E-F) (G)		(331.914)	(163.617)	70.722
Less	TAX (H)		0.000	(32.862)	11.227
	PROFIT AFTER TAX (G-H) (I)		(331.914)	(130.755)	59.495
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		117.450	258.167	204.884
Less	Adjustment on adoption of Revised AS - 15		0.000	0.000	5.921
Less	APPROPRIATIONS
		Dividend on Preference Shares	0.000	0.249	0.249
		Tax on Preference Dividend	0.000	0.042	0.042
	BALANCE CARRIED TO THE B/S		(214.464)	127.121	258.167
	EARNINGS IN FOREIGN CURRENCY
		Bulk Spices and Food Ingredients	1401.129	1383.199	1268.312
		Others	0.000	0.000	10.719
	TOTAL EARNINGS		1401.129	1383.199	1279.031
	IMPORTS
		Raw Materials	677.843	539.441	587.889
		Stores & Spares	10.321	2.352	0.000
		Capital Goods	0.000	0.000	0.107
	TOTAL IMPORTS		688.164	541.793	587.996
	Earnings Per Share (Rs.)		76..62	(31.23)	15.64

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	(16.34)	(6.31)	3.68
Net Profit Margin (PBT/Sales)	(%)	(16.35)	(7.91)	4.42
Return on Total Assets (PBT/Total Assets}	(%)	(15.49)	(6.85)	3.42
Return on Investment (ROI) (PBT/Networth)		(0.55)	(0.17)	0.08
Debt Equity Ratio (Total Liability/Networth)		2.70	1.62	1.28
Current Ratio (Current Asset/Current Liability)		2.93	3.54	3.47

LOCAL AGENCY FURTHER INFORMATION

FORM 8:

Corporate identity number of the company	U51109KL1942PLC001301
Name of the company	Vallabhdas Kanji Limited
Address of the registered office or of the principal place of business in India of the company	19/119, Beach Road, Alleppey – 688012, Kerala, India
This form is for	Modification of charge
Charge identification (ID) number of the charge to be modified	10161823
Type of charge	Immovable property
Particular of charge holder	Union Bank of India, Overseas Branch, M G Road, Ernakulam – 682035, Kerala, India
Nature of instrument creating charge	Memorandum of Deposit of Title deeds dated 19 April 2010 issued by The Federal Bank Limited, Mullakkal Branch, Alleppey and Union Bank of India, Mullakkal Branch Alleppey. The Existing assistance from consortium banks consisting of Union Bank of India, Federal Bank, Axis Bank and Standard Chartered Bank was secured by extension of mortgage over the immovable properties of the company.
Date of instrument Creating the charge	19.04.2010
Amount secured by the charge	Rs.2201.000 Millions
Brief of the principal terms an conditions and extent and operation of the charge	Rate of Interests No Change in existing terms and Conditions. Terms of Repayment: No change in existing terms and conditions. Margin: No change in existing terms and conditions. Extent and Operation of the charge: Loan sanctioned along with interest is further secured by mortgage of immovable properties of the company. For term loans sanctioned - Paripassu First charge on Immovable properties mortgaged For Working Capital facility - Second charge on immovable properties mortgaged. Others: The Existing assistance from consortium banks as under was secured by extension of mortgage over the immovable properties of the company. Term Loan - sanctioned limit (Rs. in Millions) - Paripassu First charge 1. UBI -124.500 2. Federal Bank – 131.500 3. Axis Bank - 155.000 Working Capital Facilities - sanctioned limit (Rs. In Millions) - Paripassu Second Charge
Particulars of the property charged	· 193 cents of land in Sy.No.777/2B, 777/3A, 777/3B of Alpy (W) Village by Sale deed No 1664/42 dated 3.11.42 · 42.553 cents land in SyNo.108/3,109,108/2 and 1274 of Mattancherry Village by Sale deed No.1820/71 dated 27.5.71 · 60 cents of land with building SyNo.320/1, of Thiruvanyoor Village by Sale deed No. 4391/ 2002 dated 4/12/2002 · 4 acres 76.7 cents land in SyNo.320/1, 316/2,320/1,332/1 of Thiruvanyoor Village by Sale deed No. 4390/2002 dated 4/12/2002
Particulars of the present modification	The Existing assistance from consortium banks as under was secured by extension of mortgage over the immovable properties of the company. Term Loan - sanctioned limit (Rs. In Millions) - Paripassu First charge 1. UBI -124.500 2. Federal Bank – 131.500 3. Axis Bank - 155.000 Working Capital Facilities - sanctioned limit (Rs. In Millions) - Paripassu Second Charge

CONTINGENT LIABILITIES:

Particulars	As on 31.03.2010 (Rs. in Millions)	As on 31.03.2009 (Rs. in Millions)
Bills Discounted	507.562	649.843
Counter Guarantees given by the company	301.951	186.769
Disputed Sales Tax Demands	1.122	0.000
Letter of Credits outstanding against which material not received	48.821	42.451
Dividend on Cumulative Preference Shares	0.249	0.000
Total	859.705	879.063

FIXED ASSETS:

· Goodwill

· Land

· Building

· Plant and Machinery

· Furniture and Fixture

· Computers

· Vehicles

WEBSITE DETAILS:

PROFILE:

Subject is Asia's largest processor of spice and spice ingredients, is located Kerala, India - the heartland of spices. Subject is the flagship company of the USD 100 Million Kanji Moorarji Group, which includes Kancor Flavours and Extracts Limited, and Autohangar (India) Private Limited. Kanji Moorarji is renown for benchmarking quality in the spice trade. Company commenced its operations in 1935 as a whole spice trader, with black pepper as its core product. Company has emerged as a technology based quality-driven supplier worldwide of a complete range of spice products. As India's largest, most diversified spice product exporter, Company commands an expanding market in over 40 countries throughout the Americas, Europe, Oceania, the Middle East and South East Asia.

Company is managed by the principals of value creation. They use their financial and human resources to add value to their customers' products, through

· Global Sourcing

· Backward Integration

· Low overheads and

· Economies of Scale.

With a 70-year leadership in the industry, Company has a competitive edge built on its knowledge base in farming, procurement, logistics, and the financial and commodity markets.

They ensure profitability for their shareholders and strive to increase Company’s market value. Finally, they act as a good citizen in their community. They believe in giving back. They encourage their people to play an active role in contributing to the society around them.

HISTORY:

Year 1935, in a sleepy little countryside on the southwest coast of India, a visionary was planning to change the food habits of the world. His astute mind saw that, through the western palates traditionally favoured bland food, they would welcome a little extra piquancy and flavour, if only someone was there to show them how.

That pioneering spirit belonged to Mr. Vallabhdas Vasanji Mariwala. Quick on the uptake, he installed a spice processing plant on the banks of Alleppey's palm-fringed backwaters, and became one of India's first exporters of black pepper.

Mr. Vallabhdas was every inch a man of spices - right down to his last name. In his native Gujarati language, "Mariwala" literally means "pepper-man". He helped in the formation of the Pepper Exchange in Cochin.

He also introduced the convention of naming spices after the port towns where they are originated - Cochin, Alleppey, Malabar and Tellicherry.

The Vallabhdas factory – Company - was as distinctive as the man himself. The massive wooden door that adorns the facia stands as a reminder of company’s entry as a pioneer and leader in every aspect of India's spice trade and industry.

India's oldest, largest and most diversified exporter of spices, company has emerged as a technology-based, quality-driven, customer-oriented multinational, with customers in over 40 countries. Company’s processing operations are divided between three ISO 9001:2000 certified and HACCP compliant plants, with a combined production capacity of 19,000 tonnes of ground spices and seasonings per annum. Company’s spices and blends are supplied to most leading food multinationals and fast-food chains in the USA, Europe, Middle East, Australia, Japan, New Zealand, Canada and Asia.

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.45.37
UK Pound	1	Rs.73.53
Euro	1	Rs.64.37

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	4
--PROFITABILIRY	1~10	2
--LIQUIDITY	1~10	4
--LEVERAGE	1~10	3
--RESERVES	1~10	3
--CREDIT LINES	1~10	3
--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		35

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.