MIRA INFORM REPORT

Report Date :

18.08.2011

IDENTIFICATION DETAILS

Name :	TORRENT CABLES LIMITED (w.e.f. 24.11.2008)
Formerly Known As :	TORRENT GUJARAT BIOTECH LIMITED
Registered Office :	Torrent House, Near Dinesh Hall, Ashram Road 9, Ahmedabad – 380009, Gujarat
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	22.03.1991
Com. Reg. No.:	015279
Paid-up Capital :	Rs. 85.984 Millions
CIN No.: [Company Identification No.]	L24230GJ1991PLC015279
TAN No.: [Tax Deduction & Collection Account No.]	BRDT00603B
PAN No.: [Permanent Account No.]	AAACT6739Q
Legal Form :	A Public Limited Liability company. The Company’s Shares are Listed on the Stock Exchange.
Line of Business :	Manufacturing and Marketing of XLPE Insulated PVC Sheathed Cables, PVC Insulated and PVC Sheathed Cables and Rubber Cables.
No. of Employees :	337 (approximately)

RATING & COMMENTS

MIRA’s Rating :

Ba (54)

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

Maximum Credit Limit :	USD 5400000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established company having fine track records. The company is progressing well. Trade relations are reported as fair. Business is active. Payments are reported to be 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.

INFORMATION DECLINED BY

Name :	Mr. Jay Mehta
Designation :	Accounts Executive
Date :	17.08.2011
Name :	Mr. Bahu Nair
Designation :	Accounts Executive
Date :	17.08.2011

LOCATIONS

Registered Office :	Torrent House, Near Dinesh Hall, Ashram Road 9, Ahmedabad – 380009, Gujarat, India
Tel. No.:	91-79-22405090/ 22527630
Fax No.:	91-79-22463484/ 22460048
E-Mail :	info@torrent-india.com tclho@torrentcables.com bkpatel@torrentcables.com
Website :	http://www.torrentpower.com http://www.torrentcables.com
Corporate Office 1:	Chanakya, 7^th Floor, Off Ashram Road, Ahmedabad – 380009, Gujarat, India
Head/ Corporate Office 2:	Pelican, 6^th Floor, GCCI Compound, Ashram Road, Ahmedabad – 380009, Gujarat, India
Tel No.:	91-79-26582573/30001067/68/69
Fax No.:	91-79-26583484/26582573
Factory :	Yogi Nagar, Mission Road, Nadiad – 387001, District Kheda, Gujarat, India
Tel No.:	91-268-2581959
Fax No.:	91-268-2581989
Email :	tclnadiad@torrentcables.com
Branch Office :	Located at: · Ahmedabad · Delhi · Nadiad · Bangalore · Baroda · Hyderabad · Mumbai · Chennai · Pune · Kolkata · Surat · Vizag

DIRECTORS

As On 31.03.2011

Name :	Mr. Rohit C Mehta
Designation :	Chairman
Name :	Mr. V S Parikh
Designation :	Director
Name :	Mr. Prafull Anubhai
Designation :	Director
Name :	Mr. V A Shah
Designation :	Director
Name :	Mr. Jagrut Vyas
Designation :	Director-in-Charge
Audit Committee :	Mr. V S Parikh Mr. Rohit C. Mehta Mr. Prafull Anubhai Mr. Jagrut Vyas

KEY EXECUTIVES

Name :	Mr. B K Patel
Designation :	Company Secretary
Name :	Mr. Jay Mehta
Designation :	Accounts Executive
Name :	Mr. Bahu Nair
Designation :	Accounts Executive

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As On 30.06.2011

Names of Shareholders	No. of Shares	Percentage
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Bodies Corporate	5,245,606	61.01
Sub Total	5,245,606	61.01
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	5,245,606	61.01
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	202	-
Financial Institutions / Banks	694	0.01
Sub Total	896	0.01
(2) Non-Institutions
Bodies Corporate	341,059	3.97
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 million	2,280,451	26.52
Individual shareholders holding nominal share capital in excess of Rs. 0.100 million	681,213	7.92
Any Others (Specify)	49,170	0.57
Non Resident Indians	49,170	0.57
Sub Total	3,351,893	38.98
Total Public shareholding (B)	3,352,789	38.99
Total (A)+(B)	8,598,395	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	-	-
(1) Promoter and Promoter Group	-	-
(2) Public	-	-
Sub Total	-	-
Total (A)+(B)+(C)	8,598,395	-

"Promoter and Promoter Group"
Sl. No.	Name of the Shareholder	Total Shares held		Shares pledged or otherwise encumbered
		Number	As a % of grand total (A)+(B)+(C)	Number	% of Total shares held	As a % of grand total (A)+(B)+(C)
1	Torrent Private Limited	5,245,606	61.01	-	-	-
	Total	5,245,606	61.01	-	-	-

BUSINESS DETAILS

Line of Business :

Manufacturing and marketing of XLPE insulated PVC Sheathed Cables, PVC Insulated and PVC Sheathed Cables and Rubber Cables.

Products :

Item Code No. (ITC Code)	85442012
Product Description	Power Cables
Item Code No. (ITC Code)	85442029
Product Description	Insulated Cables

PRODUCTION STATUS (As On 31.03.2011)

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
XLPE Cables (H.T.)	Core Kms	2000	9900	3738.2
XLPE Cables (L.T.)	Core Kms	2000	4800	5563.1
PVC Cables	Core Kms	21.95 (*)	15000	12092.0

(*) million (24 million core yards) on 3 shift basis

Notes: a) The installed capacities are as certified by the Management and is on three shifts working basis and is subject to product-mix planned by the Company.

b) The actual production has exceeded the installed capacity in certain cases. This has been possible by using the spare capacities of other lines.

c) The licenced capacity of 2000 Core Kms. for XLPE Cables (H.T.) also covers XLPE Cables (L.T.).

d) XLPE Cables (H.T.) installed capacity has been increased by expansion. For the year 2009-10 capacity was available only for one month and accordingly core kilometer installed capacity has been shown above.

GENERAL INFORMATION

No. of Employees :

337 (approximately)

Bankers :

· Bank of Baroda

· Union Bank of India

· Axis Bank Limited

Facilities :

Secured Loans	31.03.2011 (Rs. In Millions)	31.03.2010 (Rs. In Millions)
From Banks
Term Loan	89.180	104.633
Cash Credit Accounts	17.576	0.000
Total	106.756	104.633

NOTE:

1. Term loan from a Bank is in the form of Suppliers' Line of Credit against hypothecation of Specific Machinery.

2. Banks have extended the facility in the form of Cash Credit Accounts. This facility is secured by hypothecation of stock-in-trade, stores, spares and book debts and further secured by a second charge on fixed assets excluding office building, furniture and fixtures and vehicles.

Banking Relations :	--
Auditors :
Name :	C C Chokshi and Company Chartered Accountants
Address :	Ahmedabad, Gujarat, India
Associates/Subsidiaries :	· Torrent Pharmaceuticals Limited · Torrent Power Limited · Gujarat Lease Financing Limited · Torrent Financiers · Torrent Energy Limited · Torrent Power Services Private Limited · AEC Cements and Construction Limited
Holding Company :	· Torrent Private Limited

CAPITAL STRUCTURE

As On 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
70000000	Equity Shares	Rs.10/- each	Rs. 700.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
45000011	Equity Shares	Rs.10/- each	Rs. 450.000 Millions

Subscribed:

No. of Shares	Type	Value	Amount
8598395	Equity Shares	Rs.10/- each	Rs. 85.984 Millions

Paid-up Capital :

No. of Shares	Type	Value	Amount
8598395	Equity Shares	Rs.10/- each	Rs. 85.984 Millions

NOTE:

· 7479762 Equity Shares of Rs.10/- fully paid have been issued pursuant to the scheme of amalgamation without payment being received in cash to the shareholders of merged company – Torrent Cables Limited

· 5245606 Equity Shares are held by the holding company – Torrent Private Limited

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2011	31.03.2010	31.03.2009
SHAREHOLDERS FUNDS
1] Share Capital		85.984	85.984	85.984
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		1267.993	1224.228	1149.299
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		1353.977	1310.212	1235.283
LOAN FUNDS
1] Secured Loans		106.756	104.633	100.376
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		106.756	104.633	100.376
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		1460.733	1414.845	1335.659
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		667.060	699.960	151.270
Capital work-in-progress		0.000	5.438	300.923
INVESTMENT		0.350	0.350	0.350
DEFERREX TAX ASSETS		0.000	0.000	6.317
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	329.179	279.828	271.052
	Sundry Debtors	549.359	495.011	435.003
	Cash & Bank Balances	58.892	73.552	238.675
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	191.896	157.732	179.963
Total Current Assets		1129.326	1006.123	1124.693
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	198.524	164.390	95.763
	Other Current Liabilities	90.157	77.356	111.030
	Provisions	47.322	55.280	41.101
Total Current Liabilities		336.003	297.026	247.894
Net Current Assets		793.323	709.097	876.799
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		1460.733	1414.845	1335.659

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Income	2453.292	1671.685	1327.331
		Other Income	74.892	77.071	36.755
		TOTAL (A)	2528.184	1748.756	1364.086
Less	EXPENSES
		Material Cost and other consumptions	2140.130	1394.434	1137.835
		Employees’ Remuneration	90.876	80.763	49.440
		Other Expenses	149.083	128.310	82.261
		Provision for doubtful debts	0.000	0.000	6.324
		Increase/(Decrease) in Finished Goods	(33.619)	21.928	(45.924)
		TOTAL (B)	2346.470	1625.435	1229.936
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		181.714	123.321	134.150
Less	FINANCIAL EXPENSES (D)		20.587	6.423	0.482
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		161.127	116.898	133.668
Less/ Add	DEPRECIATION/ AMORTISATION (F)		77.419	23.108	21.013
	PROFIT BEFORE TAX (E-F) (G)		83.708	93.790	112.655
Less	TAX (I)		14.960	(11.217)	11.954
	PROFIT AFTER TAX (G-I) (J)		68.748	105.007	100.701
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		266.769	261.841	251.319
Less	APPROPRIATIONS
		Transfer to General Reserve	40.000	70.000	60.000
		Proposed Dividend	21.496	25.795	25.795
		Distribution Tax on Proposed Dividend	3.487	4.284	4.384
	BALANCE CARRIED TO THE B/S		270.534	266.769	261.841
	EARNINGS IN FOREIGN CURRENCY
		Value of Deemed Exports	13.258	18.847	29.186
	TOTAL EARNINGS		13.258	18.847	29.186
	IMPORTS
		Raw Materials	286.645	175.873	141.833
		Plant and machinery	20.914	44.480	139.336
	TOTAL IMPORTS		307.559	220.353	281.169
	Earnings Per Share (Rs.)		7.99	12.21	11.71

QUARTERLY RESULTS

PARTICULARS	30.06.2011
Type	1^st Quarter
Net Sales	825.720
Total Expenditure	737.510
PBIDT (Excl OI)	88.210
Other Income	2.330
Operating Profit	90.540
Interest	3.250
PBDT	87.290
Depreciation	18.850
Profit Before Tax	68.440
Tax	15.000
Profit After Tax	53.440
Net Profit	53.440

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	2.72	6.00	7.38
Net Profit Margin (PBT/Sales)	(%)	3.41	5.61	8.49
Return on Total Assets (PBT/Total Assets}	(%)	4.66	5.76	8.83
Return on Investment (ROI) (PBT/Networth)		0.06	0.07	0.09
Debt Equity Ratio (Total Liability/Networth)		0.33	0.30	0.28
Current Ratio (Current Asset/Current Liability)		3.36	3.25	4.54

LOCAL AGENCY FURTHER INFORMATION

The Details of Sundry Creditors:

Rs. In Millions

Particulars	31.03.2011	31.03.2010	31.03.2009
Sundry Creditors
Micro Enterprises and Small Enterprises	0.289	0.024	0.055
Others	198.235	164.366	95.708
Total	198.524	164.390	95.763

HISTORY:

Torrent Gujarat Biotech was incorporated on 22 Mar.'91 to manufacture 1000 mmu pa of penicillin-G. The company was jointly promoted by Torrent Pharmaceuticals, Torrent Exports and the Gujarat Industrial Investment Corporation.

The Torrent group has 40% equity stake while GIIC controls around 11% in the company. Commercial production of penicillin-G commenced in Jun.'95. Taking advantage of the liberalised policy, the company has decided to enhance its capacity to 1500 mmu pa. Subsequently, it decided to set up production facilities to manufacture 180 tpa of semi-synthetic penicillin (SSP), 70 tpa of semi-synthetic cephalosporin (SSC) and drug intermediates -- 6-APA and 7-ADCA -- as a measure of forward integration.

The project was part-financed by a rights issue in Sep.'95. The company has joined the consortium of leading international manufacturers of penicillin-G by becoming a member of Panlabs, US. It has entered into an agreement with Panlab to supply cultures, information on fermentation conditions and yields obtained in shake flasks, covering a period of 5 years between 1994 and 1998.

During 1999-2000, the company has been declared as a Sick Industrial Company by BIFR on September 24, 1999 and appoints IFCI Limited as operating agency. IFCI had submitted an revival scheme and BIFR asked IFCI to resubmit the modified scheme as per it's direction. The company has successfully received Sanction of the Rehabilitation Scheme on 10th March 2003 from BIFR.

Operations

The gross sales for the year ended on 31.03.2011 was Rs. 2760.000 millions compared to last year’s Rs. 1870.000 millions. The Company has earned Profit Before Tax (PBT) of Rs. 83.700 millions.

The increase in sales is on account of New HT XLPE Production Line operational for the full year.

The Cash Profit for the year is Rs. 161.100 millions compared to last year’s Rs. 116.900 millions. However, the Profit Before Tax has been affected due to Depreciation. In the year, the Depreciation charged is higher at Rs. 77.400 millions, which was Rs. 23.100 millions last year. The higher depreciation is on account of the New HT Production Line commissioned in March, 2010.

The margins have been affected on account of increasing trend of Raw Material prices. The normal business practice is the firm price orders and hence the increase in input prices has to be absorbed by the Company. Due to excess production capacity in the industry, there is severe competition which also affects the price realization.

Future Prospects and Plans

The power sector has not achieved the targeted capacity addition. For the year 2009-10, the target was 14507 MW against which the actual capacity addition was 9585 MW. For the period April, 2010 to December, 2010 the target was 20359 MW against which actual addition is 9730 MW.

This slower pace capacity addition has its impact on the transmission and distribution investments. As the Indian Economy prepares for sustained growth of 8 – 9%, the importance of power sector should continue to increase. The power sector demand is expected to grow at 7.5% - 8% CAGR till 2017. The Government’s focus on attaining “power for all” has accelerated capacity addition in the country. For the next few years there is the possibility for huge investment in the power sector.

The above suggests that power related business will have good prospects.

MANAGEMENT DISCUSSION AND ANALYSIS

Power Cable Industry Outlook:

The Central Plan Outlay for Power Sector has been enhanced from Rs. 660970.000 Millions in the Budget 2010-11 to Rs. 727540.000 Millions in the Budget 2011-12. The GDP growth at 8.6% in real terms in the year 2010-11 and expectations of 9% in the current financial year are encouraging. The strong emphasis on infrastructure is clearly visible in the budget with an increased allocation in infrastructural sector.

The power sector in the country is poised for record capacity addition of 15000 MW during the present financial year. The total installed power capacity rose to 170469 MW by December, 2010 compared to 123901 MW in December, 2006.

This factor suggests that demand in power sector should grow. Utilities have to be efficient by reducing transmission and distribution loss and conversion of overhead lines to underground cabling particularly in cities should help the cable industry to sustain the growth.

Company Outlook:

The new HT XLPE line was fully operational during the year. The major refurbishing and renovating the old HT XLPE line in the current year should help to maintain the production level.

The Company plans for investments in the range of Rs. 50.000 to 80.000 millions to overcome the imbalances and thereby increase the output of the new HT XLPE line by nearly 15%. However, this is expected to be operational in the last quarter of the year.

FINANCIAL PERFORMANCE V/S. OPERATIONAL PERFORMANCE:

During the year, Company has earned the Cash Profit of Rs. 160.000 millions compared to Rs. 120.000 millions in the previous year.

The increasing trend import prices since 2nd quarter of the year has affected the margins, particularly in the 3rd and 4^th quarter.

The proper financial planning with focus on views of internal accruals and lesser dependency on borrowed funds has helped to control the interest cost.

Forward planning on continuous basis, reputation with the raw material suppliers, conservative and efficient procurement strategy, overheads control have helped the Company to control the cost.

Contingent liabilities not provided for:		[Rs. in millions]
			As at	As at
			31.03.2011	31.03.2010
a)	Guarantees and Undertakings		134.102	121.293
b)	Outstanding Letters of Credit		85.080	86.139
c)	Claims against the Company not Acknowledged as debts		3.117	2.403
d)	Disputed Sales Tax matters for the year 2002-03 and 2003-04		42.875	42.875

AUDITED FINANCIAL RESULTS FOR THE THREE MONTHS ENDED 30.06.2011

Rs. In Millions

1	(a) Net Sales / lncome from Operations	8.15.125
	(b) Other Operating Income	10.593
2	Expenditure
	a. (Increase)/Decrease in stock in trade and work in progress	(12.641)
	b. Consumption of raw & packing materials	672.803
	c. Purchase of traded goods
	d. Employees cost	24.147
	e. Depreciation	18.847
	f. Other expenditure	53.202
	g. Total	756.358
3	Profit from Operations before Other Income, Interest and Exceptional Items (1-2)	69.360
4	Other Income	2.332
5	Profit before Interest and Exceptional items (3+4)	71.692
6	Interest	3.250
7	Profit after Interest but before Exceptional Items (5-6)	68.442
8	Exceptional items
9	Profit from Ordinary Activities before tax (7+8)	68.442
10	Less: Tax expense	15.000
11	Net Profit from Ordinary Activities after tax (9-10)	53.442
12	Extraordinary Items
13	Net Profit for the period (I 1-12)	53.442
14	Paid-up equity share capital (Face Value Rs. 101-)	85.984
15	Reserves excluding Revaluation Reserves
16	Earnings Per Share (EPS) (Not annualised)
	a) Basic and diluted EPS before Extraordinary items	6.21
	b) Basic and diluted EPS after Extraordinary items	6.21
17	Public Shareholding
	-No. of shares	3352789
	-Percentage of shareholding	38.99
18	Promoters and promoter group Shareholding
	a) Pledged Encumbered
	Number of Shares	--
	Percentage of shares (as a % of the total shareholding of promoter and promoter group)	--
	Percentage of shares (as a % of the total share capital of the Company)	--
	b) Non-encumbered
	No. of Shares	5245606
	Percentage of Shares (as a% of the total shareholding of promoter and promoter group)	100.00
	Percentage of shares (as a % of the total share capital of the company	61.01

Notes:

1) The Company has only one Revenue segment - Power cables. Hence no separate segment wise information of Revenue, Results, Capital employed etc. is given as required by Accounting Standard (AS-17) "Segment Reporting".

2) During the quarter ended 30.06.2011, the Company has received and disposed off two Investor's complaints. There was no investors' complaints pending at the beginning and at the end of the quarter.

3) The statement of financial results has bean prepared by applying the same Accounting Policies as were applied in the preparation of annual financial statements for the previous year.

4) The above results were reviewed by the Audit Committee and approved by the Board of Directors on 27.07.2011.

FIXED ASSETS:

· Land

· Building Factory

· Building Others

· Plant and Machinery

· Electrical Installation

· Furniture and Fixture and Office Equipment

· Vehicles

CMT REPORT (Corruption, Money Laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No records exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] 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.74.56
Euro	1	Rs.65.34

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	6
--RESERVES	1~10	6
--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	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		53

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.