MIRA INFORM REPORT

Report Date :

19.08.2011

IDENTIFICATION DETAILS

Name :	BAJAJ ALLIANZ LIFE INSURANCE COMPANY LIMITED
Formerly Known As :	ALLIANZ BAJAJ LIFE INSURANCE COMPANY LIMITED
Registered Office :	GE Plaza, Airport Road, Yerawada, Pune – 411006, Maharashtra
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	12.03.2001
Com. Reg. No.:	11-15959
Capital Investment / Paid-up Capital :	Rs.1507.090 Millions
CIN No.: [Company Identification No.]	U6601PN2001PLC015959
TAN No.: [Tax Deduction & Collection Account No.]	PNEA03242B
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Providing Life Insurance Related Services
No. of Employees :	Not divulged by the Management

RATING & COMMENTS

MIRA’s Rating :

Ba (51)

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

Maximum Credit Limit :	USD 90000000
Status :	Satisfactory
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a Life Insurance Company and a Joint Venture between Allianz Group and Bajaj Auto. It is a well established company having satisfactory track. Directors are reported to be experienced and respectable businessmen. Trade relations are reported as fair. Business is active. Payments are regular and as per commitments. The Company can be considered good for normal 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. Sachin Satalkar
Designation :	Accounts Department for Banking
Date :	17.08.2011

LOCATIONS

Registered/ Head Office :	GE Plaza, Airport Road, Yerawada, Pune – 411006, Maharashtra, India
Tel. No.:	91-20-66026777/ 30587888/ 30305858
Fax No.:	91-20-66026789/ 40111502
E-Mail :	life@bajajallianz.co.in
Website :	www.bajajallianzlife.co.in
Customer Care Centre :	Located at: Rajasthan

DIRECTORS

AS ON 30.07.2010

Name :	Mr. Rahul K. Bajaj
Designation :	Chairman Cum Managing Director
Address :	Bajaj Auto Colony, Mumbai – Pune Road, Akurdi, Pune – 411035, Maharashtra, India
Date of Birth/Age :	10.06.1938
Date of Appointment :	12.03.2001
Name :	Mr. Sanjiv R Bajaj
Designation :	Director
Address :	Bajaj Auto Colony, Mumbai – Pune Road, Akurdi, Pune – 411035, Maharashtra, India
Date of Birth/Age :	02.11.1969
Date of Appointment :	12.03.2001
Name :	Mr. Ranjit K. Gupta
Designation :	Director
Address :	131/24, PCNTD, Nigdi, Pune – 411044, Maharashtra, India
Date of Birth/Age :	19.03.1943
Date of Appointment :	12.03.2001
Name :	Mr. Heinz H. Dollberg
Designation :	Director
Address :	Heilwigstrasse 7A 81825, Munich, Germany
Date of Birth/Age :	29.01.1949
Date of Appointment :	23.04.2001
Name :	Mr. Niraj R. Bajaj
Designation :	Director
Address :	Flat No. 97, Mount Unique, 13^th Floor, 62A, Mumbai – 400026, Maharashtra, India
Date of Birth/Age :	10.10.1954
Date of Appointment :	06.03.2008
Name :	Mr. Sanjay K. Asher
Designation :	Director
Address :	No. 32, Mody Street, Mumbai – 400001, Maharashtra, India
Date of Birth/Age :	26.11.1963
Date of Appointment :	06.06.2002
Name :	Mr. Suraj C. Mehta
Designation :	Director
Address :	No. 24, Sonarica 33A, Pedder Road, Mumbai – 400026, Maharashtra, India
Date of Birth/Age :	01.05.1944
Date of Appointment :	06.06.2002
Name :	Mr. Serajul H. Khan
Designation :	Director
Address :	181 Antariksha Apts, 95/96 Ameva 1210/8 K P Kulkarni Road, Shivaji Nagar, Pune – 411005, Maharashtra, India
Date of Birth/Age :	01.07.1938
Date of Appointment :	22.09.2006
Name :	Mr. Manu P. Tandon
Designation :	Director
Address :	16 Solitaire 4 Samadhi Road, Off. Pune Nagar Road, Pune – 400026, Maharashtra, India
Date of Birth/Age :	24.07.1943
Date of Appointment :	22.09.2007
Name :	Mr. Kamesh G. Goyal
Designation :	Alternate Director to Mr. Manuel Bauer)
Address :	244/254, Clover Water Garden Kalyani Nagar, Pune – 411006, Maharashtra, India
Date of Birth/Age :	25.05.1966
Date of Appointment :	06.03.2008
Name :	Mr. Sameer M. Bakshi
Designation :	Director
Address :	E-3, Konark Campus, Viman Nagar, Pune, Maharashtra, India
Date of Birth/Age :	20.04.1979
Date of Appointment :	12.02.2007
Name :	Mr. Manuel Bauer
Designation :	Director
Name :	Mr. V. Philip
Designation :	Managing Director and Chief Executive Officer

KEY EXECUTIVES

Name :	Mr. Sachin Satalkar
Designation :	Accounts Department for Banking
Name :	Mr. Rajesh Viswanathan
Designation :	Chief Financial Officer
Name :	Mr. Sameer Bakshi
Designation :	Company Secretary and Head Legal and Compliance.

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 30.07.2010

Names of Shareholders	No. of Shares
Bajaj Finserv Limited, India	111524060
Allianz Se, India	39184340
Bajaj Finserv Limited, India Jointly Rahul K. Bajaj	100
Bajaj Finserv Limited, India Jointly Mr. Niraj R. Bajaj	100
Bajaj Finserv Limited, India Jointly Mr. Sanjiv R. Bajaj	100
Bajaj Finserv Limited, India Jointly Mr. Ranjit K. Gupta	100
Bajaj Finserv Limited, India Jointly Mr. Kevin D Sa	100
Bajaj Finserv Limited, India Jointly Mr. Sridhar J	100
Total	150709000

AS ON 30.07.2010

Equity Shares break-up

Sr. No.	Category	Percentage
1.	Foreign holdings (Foreign institutional investor(s), Foreign comanie(s) Foreign financial institution(s), Non-resident indian(s) or overseas corporate bodies or others	26.00
2.	Bodies Corporate	74.00
	Total	100.00

BUSINESS DETAILS

Line of Business :

Providing Life Insurance Related Services

Products :

UNIT LINKED Regular Premium New UnitGain Super UnitGain Plus Gold New UnitGain Plus New UnitGain YoungCare YoungCare Plus New FamilyGain-R Single Premium New UnitGain Premier SP New UnitGain Plus SP PENSION Annuity Pension Guarantee Retirement Future Income Generator Swarna Vishranti New UnitGain Easy Pension Plus RP New UnitGain Easy Pension Plus SP Future Secure TRADITIONAL Endowment InvestGain SaveCare Economy SP Life Time Care Super Saver Money Back CashGain TERM PLANS Protector Term Care New Risk Care WOMEN INSURANCE Miss Confident Plans HEALTH Care First Health Care Family CareFirst CHILDREN PLAN ChildGain JUST LAUNCHED Family Assure Fortune Plus CenturyPlus II UnitGain Protection Plus Invest Plus Group Seva Plan GROUP Non Employer Employee Credit Shield Group Term Life(Non Employer Employee) Group Suraksha Swayam Shakti Suraksha Group Loan Protector Group Income Protection Employer Employee Group Term Life(Employer Employee) New Group Gratuity Care New Group Superannuation Care Group Save Plus Group Term Life in lieu of EDLI Group Leave Encashment Scheme Group Annuity Group Superannuation Gold Group Gratuity Gold MICRO INSURANCE Alp Nivesh Yojana Jana Vikas Yojana Saral Suraksha Yojana ADDITIONAL RIDER BENEFITS Unit Linked Additional Rider Benefits UL Waiver of Premium Benefit UL Family Income Benefit Non Unit Linked Additional Rider Benefits

GENERAL INFORMATION

No. of Employees :	Not divulged by the Management
Bankers :	Standard Chartered Bank Axis Bank Deutsche Bank HDFC Bank Syndicate Bank Citi Bank

Banking Relations :	--
Auditors :
Name :	Dalal and Shah Chartered Accountant
Address :	252. Veer Savarkar Marg, Shivaji Park, Dadar (West), Mumbai-400028, Maharashtra, India
Name :	BSR and Company Chartered Accountant
Holding Company :	Bajaj Finserv Limited L65923PN2007PLC130075
Group Companies :	· Bajaj Auto Limited · Bajaj Holding and Investment Limited · Bajaj Finance Limited (Earlier Know as Bajaj Auto Finance limited) · Bajaj Allianz General Insurances Company Limited · Bajaj Allianz Financial Distributors Limited · Allianz SE · Allianz Insurances Management Asia Pacific Pte. Limited · Allianz SE Reinsurance Branch Asia Pacific · Hind Musafir Agency Limited · IDS GmbH · Allianz Mena Holding Company SPC · Allianz Investment Management Singapore Pte. Limited · Bajaj Electricals Limited

CAPITAL STRUCTURE

AS ON 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
200000000	Equity Shares	Rs.10/- each	Rs.2000.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
150709000	Equity Shares	Rs.10/- each	Rs.1507.090 Millions

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	1507.090	1507.090	1507.090
2] Reserves & Surplus	20986.962	10599.550	10599.550
3] Credit / Debit Fair Value Change Account	0.005	0.000	0.000
NETWORTH	22494.057	12106.640	12106.640
BORROWINGS	0.000	0.000	0.000
POLICYHOLDER’S FUNDS
1) Credit / Debit Fair Value Change Account	37.544	28.433	7.014
2) Policy Liabilities
Participating :
Individual Assurance	21546.414	15240.119	11319.055
Individual Pension	437.321	376.166	350.390
Non – Participating
Individual Assurance	2590.574	1030.552	191.904
Individual Health	163.927	160.464	106.164
Individual Anniuty	312.114	183.950	101.389
Group Assurances	7581.846	4171.640	1222.238
Linked :
Individual Assurances	5526.929	8670.678	4501.717
Individual Pension	270.886	448.819	194.008
Group	16.664	11.016	11.342
Total	38446.675	30293.404	17998.207
3) Insurance Reserves	0.000	0.000	0.000
4) Provisions for Linked Liabilities
Linked Liabilities	285074.847	238974.031	159828.323
Fair Value Change	43766.858	45172.123	[19175.325]
Total	328841.705	284146.154	140652.998
Sub-Total (1+2+3+4)	367325.924	314467.991	158658.219
FUNDS FOR FUTURE APPROPRIATIONS
Participating :
Individual Assurance	1150.293	994.530	918.099
Individual Pension	33.404	29.134	1.860
Non – Participating
Individual Assurance	0.000	0.000	43.964
Individual Health	0.000	0.000	94.719
Individual Anniuty	0.000	0.000	2.708
Group Assurances	0.000	0.000	9.996
Linked :
Individual Assurances	0.000	0.000	0.000
Individual Pension	0.000	0.000	0.000
Group	0.000	0.000	0.641
Total	1183.697	1023.664	1071.987
Reserve For Lapsed Unit Linked Policies	2929.021	3874.569	3951.268
TOTAL	392749.002	330449.200	175788.114
APPLICATION OF FUNDS
INVESTMENTS
Shareholders’	23520.820	15453.830	7695.214
Policyholders’
Participating :
Individual Assurance	22395.698	16305.353	12244.503
Individual Pension	463.956	406.605	354.548
Non – Participating
Individual Assurance	2547.408	1036.320	238.972
Individual Health	163.427	254.354	201.337
Individual Anniuty	307.254	184.115	104.611
Group Assurances	7689.335	4428.070	1240.846
Linked :
Individual Assurances	7087.339	11522.213	8473.612
Individual Pension	264.331	453.016	337.669
Group	18.491	32.281	21.050
Total	40937.239	34622.327	23217.148
ASSETS HELD TO COVER LINKED LIABILITIES	328841.705	284146.154	140652.998
LOANS	147.078	130.275	76.970
FIXED ASSETS [NET BLOCK]	1559.693	1512.548	1219.585
CAPITAL WORK-IN PROGRESS	94.016	281.487	424.832
CURRENT ASSETS :
Cash and Bank Balances	4385.098	2186.908	3552.963
Advances and Other Assets	3832.457	3111.630	1828.423
Sub-total	8217.555	5298.538	5381.386
LESS: CURRENT LIABILITIES AND PROVISIONS
Sundry Creditors	3282.332	3451.467	3110.997
Other Current liability	6218.583	7067.244	4941.359
Provisions	1068.189	660.226	433.509
Sub-total	10569.104	11178.937	8485.865
Net Current Assets	(2351.549)	(5880.399)	(3104.479)
MISCELLANEOUS EXPENDITURE	0.000	0.000	0.000
DEBIT BALANCE IN PROFIT AND LOSS ACCOUNT	0.000	182.978	5605.846
TOTAL	392749.002	330449.200	175788.114

PROFIT & LOSS ACCOUNT

PARTICULARS	31.03.2011	31.03.2010	31.03.2009
Amounts Transferred from the Policyholder’s Account	9355.074	5244.762	41.548
INCOME FROM INVESTMENTS
a) Interest, Dividend and Rent – Gross	1759.051	983.412	846.251
b) Profit on sale / redemption of investments	96.140	106.342	79.971
c) loss on sale / redemption of investments	(31.364)	(5.378)	[19.473]
d) Transfer / Gain on revaluation / change in fair value	0.000	0.000	0.000
OTHER INCOME	0.000	0.000	0.000
TOTAL (A)	11178.901	6329.138	948.297
Expenses other than those directly related to the insurance business	45.534	64.732	15.943
Others
Provisions (Other than Taxation)	0.000	0.000	0.000
Contributions to the Policyholder’s Fund
Participating :
Individual Assurance	0.000	0.000	0.000
Individual Pension	0.000	0.000	0.000
Non – Participating
Individual Assurance	0.000	185.031	0.000
Individual Health	0.000	0.000	0.000
Individual Anniuty	11.874	0.000	0.000
Group Assurances	0.000	0.000	0.000
Linked :
Individual Assurances	0.000	0.000	1290.084
Individual Pension	304.846	509.432	348.191
Group Superannuation	0.000	0.000	0.000
Group Gratuity	0.000	0.000	0.806
Total	316.720	694.463	1639.081
TOTAL (B)	362.254	759.195	1655.024
Profit / Loss Before Tax	10816.647	5569.943	(706.727)
Provision for Taxation including Wealth Tax	246.257	147.075	0.085
Profit / Loss After Tax	10570.390	5422.868	(706.812)
Balance at the beginning of the year	(182.978)	(5605.846)	(4899.034)
Profit / Loss carried forward to Balance Sheet	10387.412	(182.978)	(5605.846)
Earning Per Share (Basic and Diluted)	70.14	35.98	(4.69)

LOCAL AGENCY FURTHER INFORMATION

DETAILS OF SUNDRY CREDITORS:

Particulars	31.03.2011	31.03.2010	31.03.2009
	(Rs. In Millions)
Sundry Creditors	3282.332	3451.467	3110.997

MARKET SCENARIO IN THE LIFE INSURANCE INDUSTRY:

Life Insurance industry that had seen rapid growth from the opening up of the sector in 2000-01 till 2009 –10, has witnessed a minor slowdown in the current financial year. During the year life insurance industry had a new business growth of 15.1% as against 25.5% in the year 2009-10. The 23 life insurers have mobilized a first year premium of Rs.1,258.2 billion in 2010-11 compared to Rs.1,092.9 billion in the previous year. The market share of LIC has increased from 64.9% to 68.7% while that of the private players has reduced from 35.1% to 31.3%. The Industry witnessed a negative growth of 9.66% in the second half over the corresponding period in the previous year. There has been a significant shift in the business mix, across the industry, mainly among Private Life companies, from individual regular premium business towards individual single premium business and group business. The life industry, in the second half of the year, saw a decline of 26.9% in individual regular premium business (43.5% for private companies).

A number of new regulations and amendments of earlier regulations for the insurance industry have been introduced by IRDA in the financial year 2010-11. The new changes are largely for the benefit of the policyholders which includes capping on charges and transparency in disclosures by the insurance companies. In addition to the capping of charges in the unit linked products, the lock-in period for all Unit Linked Products has been increased from three years to five years, including on the top-up premiums, to promote long term investment by the customer. Also, charges on ULIPs have been mandated to be evenly distributed during the lock in period, to eliminate high front ending of expenses. The Regulations on Treatment of Discontinued Linked Insurance Policies have also been issued wherein a policyholder would be entitled to exercise an option of either reviving the policy or completely withdrawing from the policy without any risk cover and the rates for discontinuance are also specified by the Authority. It has also been specified that all ULIP pension / annuity products shall offer a minimum guaranteed return of 3.5% on the maturity date, which has hugely impacted the sale of pension products by the insurers. These changes though welcome, pose tremendous challenge to the insurance industry in the short term.

The Authority has also issued guidelines pertaining to timeframes and uniform definitions and classifications with respect to grievance redressal by insurance companies. The distribution model for to referral tie-ups have been revised and earlier referral guidelines applicable to banks have been withdrawn. New regulations pertaining to sharing of database for distribution of insurance products have been issued. IRDA has also issued guidelines prescribing outsourcing of the core functions and rules for outsourcing of non-core functions.

SUMMARY OF OPERATIONS FOR THE YEAR:

BUSINESS PERFORMANCE

The Company is at the fourth position amongst the private life insurers on the basis of new business premium and second in terms of the number of policies issued, for the financial year 2010-11. It wrote new business of Rs.34.7 billion during 2010-11 compared to Rs44.5 billion in the previous year. The market share of the Company reduced to 2.8% compared to 4.1% in the previous year. The gross premium written for the financial year 2010-11 was Rs. 96 billion, as compared to Rs.114 billion in the previous year, registering a negative growth.

The Company earned a profit of Rs.9.6 billion during 2010-11, compared to Rs.4.2 billion in the previous year. This has been achieved by focusing on expense management, operational efficiency and acquisition expenses.

After distribution of current year's surplus of Rs.8.2 billion (previous year Rs.4 billion) and further transfer of Rs.1.1 billion (previous year Rs.1.2 billion) from Funds for Future Appropriation, the shareholders' profit after tax stands at Rs.10.5 billion (previous year Rs.5.4 billion). In 2010-11, all accumulated losses have been set off and as at 31 March 2011 the Company has accumulated profits of Rs.10.4 billion.

INVESTMENTS

The funds under management as on 31st March 2011 were Rs.393 billion comprising shareholder investments of Rs.23.52 billion; traditional policyholder investments of Rs.40.94 billion and Unit Linked investments of Rs.328.84 billion. The total investments under management of the Company have increased by 17.7% from Rs.334 billion in the previous year.

The traditional portfolios were managed keeping in mind the regulatory asset allocation requirements. The performance of the ULIP funds, for the year ended 31st March 2011 was among the top three players of the industry. The Company's cash funds delivered returns of 7% to 7.5%, outperforming the CRISIL Composite Liquid Index by 140 basis points while the bond funds outperformed the CRISIL Composite Bond Index by over 250 basis points, Debt Plus Pension Fund and Debt Plus Fund generated returns of 7.6% and 7.5% respectively without taking on undue credit or interest rate risks. The Company's diversified equity funds have delivered returns that are better than the benchmark Nifty Indices. The large cap equity funds have outperformed the NSE Nifty Index by over 5.5%, Equity Plus Pension Fund and Equity Growth Pension Fund delivering more than 16.5% returns. Mid cap equity funds have outperformed the Nifty Mid Cap 50 Index by over 15% with Accelerated Mid Cap Fund II and Equity Mid Cap Pension Fund generating returns of 8.4% and 7% respectively.

BACKGROUND

Bajaj Allianz Life Insurance Company Limited (“the Company”) was incorporated on 12th March 2001 as a Company under the Companies Act, 1956. The Company obtained a license from the Insurance Regulatory and Development Authority (“IRDA”) for carrying on the business of life insurance on 3rd August 2001.

The registration certificate granted by IRDA is valid and the same has been renewed for the year 2011-2012. The Company has a wide range of products in traditional and unit-linked insurance business.

CONTINGENT LIABILITIES

Particulars	31.03.2011	31.03.2010
Partly-paid up investments	Nil	Nil
Underwriting commitments outstanding	Nil	Nil
Claims, other than those under policies, not acknowledged as debts	37.167	0.955
Guarantees given by or on behalf of the Company	Nil	Nil
Statutory demands / liabilities in dispute, not provided for *	7.064	7.064
Reinsurance obligations to the extent not provided for in accounts	Nil	Nil
Claims, under policies, not acknowledged as debts	92.039	56.809

* The Service Tax department has issued an order on the Company for Rs.7.064 Millions (excluding interest), pertaining to the period August 2002 to 31st December 2004. The Company has filed an appeal against the order with the Customs, Excise and Service Tax Appellate Tribunal.

FIXED ASSETS:

· Computer Software

· Leasehold Improvement

· Buildings

· Electrical Fittings

· Furniture and Fittings

· Information Technology Equipment

· Air Conditions

· Vehicles

· Office Equipments

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.45.61
UK Pound	1	Rs.75.32
Euro	1	Rs.65.68

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	6
--RESERVES	1~10	5
--CREDIT LINES	1~10	6
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		51

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.