MIRA INFORM REPORT

Report Date :

12.12.2011

IDENTIFICATION DETAILS

Name :	SONA SOMIC LEMFORDER COMPONENTS LIMITED (w.e.f. 18.03.1999)
Formerly Known As :	SONA PRECISION PRODUCTS LIMITED
Registered Office :	UFG-6, Indra Prakash Building, 21, Barkhamba Road, New Delhi – 110 001
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	20.08.1993
Com. Reg. No.:	55-54930
Capital Investment / Paid-up Capital :	Rs.155.489 Millions
CIN No.: [Company Identification No.]	U74899DL1993PLC054930
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturer of ball joints for Steering Systems and Suspension Components.
No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

Ba (44)

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

Maximum Credit Limit :	USD 2400000
Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject is an established company having satisfactory track. Financial position of the company is improving. Trade relations are reported as fair. Business is active. Payments are reported to be usually correct. 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 – September 30, 2011

Country Name	Previous Rating (30.06.2011)	Current Rating (30.09.2011)
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 :	UFG-6, Indra Prakash Building, 21, Barkhamba Road, New Delhi – 110 001, India
Tel. No.:	91-11-23311924 / 23327205
E-Mail :	infossl@sonagroup.com raajesh.gupta@sonagroup.com
Website :	http://www.sonagroup.com
Corporate Office :	38/6, NH-8, Delhi-Jaipur Road, Gurgaon-122002, Haryana, India
Tel. No.:	91-124-4685000
Fax No.:	91-124-4104611/ 4104621
Factory :	Sona Enclave, Village Begumpur Khatola, Gurgaon - 122 001, Haryana, India
Tel. No.:	91-124-4746300, 4031271-73 / 410635-36
Fax No.:	91-124-4104637

DIRECTORS

As on 16.08.2011

Name :	Dr. Surinder Kapur
Designation :	Managing Director
Address :	No. 11, The Green, Rajokari, New Delhi – 110 038, India
Date of Birth/Age :	10.10.1943
Date of Appointment :	20.08.1993
DIN No.:	00062481

Other Directorship

S.No.	CIN	Name of the Company	Current designation of the director	Date of appointment at current designation	Original date of appointment	Date of cessation	Company Status	Defaulting status
1	L29113DL1984PLC018415	Sona Koyo Steering Systems Limited	Director	22-10-08	14-06-84	-	Active	NO
2	L26102DL1984PLC019542	Asahi India Glass Limited	Director	24-12-88	24-12-88	-	Active	NO
3	U74899DL1993PLC054930	Sona Somic Lemforder Components Limited	Managing director	11-04-07	20-08-93	-	Active	NO
4	U30007MH1994PLC081637	Mahindra Sona Limited	Director	30-09-94	30-09-94	-	Active	NO
5	U27300DL1995PLC073456	Sona Okegawa Precision Forgings Limited	Director	27-10-95	27-10-95	-	Active	NO
6	L92114DL1976PLC008355	Cosmo Films Limited	Director	21-10-00	21-10-00	-	Active	NO
7	U65993DL2001PTC110205	Sona Investment Private Limited	Director	28-03-01	28-03-01	-	Active	NO
8	L99999MH1922PLC000987	Greaves Cotton Limited	Director	27-10-03	27-10-03	18-02-09	Active	NO
9	U74140DL2005PTC138636	DRSK Management Services Private Limited	Director	13-07-05	13-07-05	-	Active	NO
10	U63040DL2005PLC143195	Sona Mobility Services Limited	Director	31-05-07	06-10-06	20-10-08	Active	NO
11	U74899DL1982PTC013139	Sona Autocomp Holding Private Limited	Director	10-07-07	31-01-07	-	Active	NO
12	U29268DL2007PLC165741	Jtekt Sona Automotive India Limited	Managing director	01-01-09	11-07-07	-	Active	NO
13	U35122DL2007PLC166496	Sona Fuji Kiko Automotive Limited	Director	01-08-07	01-08-07	-	Active	NO
14	U35122DL2007PLC166497	Koyo Sona Electronics Limited	Director	29-09-08	01-08-07	-	Active	NO
15	U29130PN2007FTC131036	AAM Pantnagar Axle Private Limited	Director	24-03-09	11-01-08	01-09-09	Active	NO
16	U45201DL2003PLC123512	Akme Projects Limited	Director	30-09-08	05-02-08	-	Active	NO
17	U67120MH1991PTC061336	Raghuvanshi Investment Private Limited	Director	29-09-09	24-12-08	-	Active	NO
18	U67120MH1991PTC060720	Sealand Investments Private Limited	Director	29-09-09	24-12-08	-	Active	NO
19	U74999HR2010PTC040529	Redi India Quality Services Private Limited	Director	01-11-11	13-05-10	-	Active	NO
20	U80302HR2010PTC040946	CQ WorkSkills Services Private Limited	Director	23-07-10	23-07-10	01-11-11	Active	NO
21	U51900DL2011PLC226008	Mandira Marketing Limited	Director	10-10-11	10-10-11	-	Active	NO

Name :	Mr. Masahiro Ishikawa
Designation :	Director
Address :	210, East Wing, Choo 213-17, Hamamatsu-Shi, Shizuoka, Japan 4300929
Date of Birth/Age :	05.02.1962
Date of Appointment :	16.08.2011
DIN No.:	01827932

Other Directorship

S.No.	CIN	Name of the Company	Current designation of the director	Date of appointment at current designation	Original date of appointment	Company Status	Defaulting status
1	U74899DL1993PLC054930	Sona Somic Lemforder Components Limited	Director	16-08-11	14-09-07	Active	NO

Name :	Mr. Jieming Zhu
Designation :	Director
Address :	38 Xiang Hua, Qiao Road, Appartment 4-1201, Shanghai, China 200052
Date of Birth/Age :	19.06.1961
Date of Appointment :	15.03.2005
DIN No.:	01059052
Name :	Mr. Kazumasa Suzuki
Designation :	Director
Address :	53-15 Kou Nodai Iwata-Shi, Shizuoka-Ken, Japan 4380077
Date of Birth/Age :	08.01.1958
Date of Appointment :	09.09.2009
DIN No.:	02786692
Name :	Mr. Hisao Nuki
Designation :	Whole Time Director
Address :	1403-8, Takatsuka-CHO, Hamamatsu Shi-4328065
Date of Birth/Age :	06.03.1963
Date of Appointment :	01.01.2010
DIN No.:	02786698

Other Directorship

S.No.	CIN	Name of the Company	Current designation of the director	Date of appointment at current designation	Original date of appointment	Company Status	Defaulting status
1	U74899DL1993PLC054930	Sona Somic Lemforder Components Limited	Whole-time director	01-04-11	01-01-10	Active	NO

Name :	Dr. Franz Kleiner
Designation :	Director
Address :	Haldemer Strabe, 2, Lemforde 49448
Date of Birth/Age :	16.10.1959
Date of Appointment :	15.09.2010
DIN No.:	03173611

Other Directorship

S.No.	CIN	Name of the Company	Current designation of the director	Date of appointment at current designation	Original date of appointment	Company Status	Defaulting status
1	U65993DL2001PTC110205	Sona Investment Private Limited	Director	27-08-10	30-06-10	Active	NO
2	U74899DL1993PLC054930	Sona Somic Lemforder Components Limited	Director	30-09-10	15-09-10	Active	NO

KEY EXECUTIVES

Name :	Piyali Choudhury
Designation :	Secretary
Address :	M-121, Second Floor, Blossom – II, Sector – 51, Gurgaon – 122 001, Haryana, India
Date of Birth/Age :	17.02.1976
Date of Appointment :	06.01.2011
PAN No.:	AJEPD2213R

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 16.08.2011

Names of Shareholders	No. of Shares
Surinder Kapur	1
Tapash Kumar Pal	1
P. V. Prabhu Parriker	1
Kiran Deshmukh	1
Rani Kapur	1
Somic Engineering Inc., Japan	4287215
ZF India Private Limited, India	3481419
Sudhir Chopra	1
Sona Investment Private Limited, India	4293029
Dinesh Agarwal	1
Somic Ishikawa Inc., Japan	3487232
Total	15548902

As on 16.08.2011

Equity Share Breakup	Percentage of Holding
Category
Foreign holdings [Foreign institutional investors, Foreign Companies, Foreign Financial Institutions, Non-resident Indian or Overseas corporate bodies or others]	50.00
Bodies corporate	50.00
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer of ball joints for Steering Systems and Suspension Components.

Products :

Product Description	ITC Code
End Components Steering Tie Rod	870884-00 For 800CC
Tie Rod Components Steering	870894-00 For 800 CC
Tie Rod Component Steering	870894-00 For Zen

PRODUCTION STATUS (As on 31.03.2010)

Particulars	Unit	Installed Capacity
Inner ball joint	Nos.	6780000
Outer ball joint	Nos.	10870000
Forgings	No of Strokes	27000000

Particular	Actual Production
IBJ	1770292
OBJ	1783756
BSSRS	492172
BSSPS	492172
SUSPN	1487161
FORGINGS	4820705
OTHERS	1456457

GENERAL INFORMATION

Customers :

· Maruti Suzuki (SKSSL)

· Maruti Suzuki

· Honda Siel Cars (India)

· Mahindra and Mahindra

· Toyota – India

· Toyota- India (SKSLL)

· Maval Manufacturing Today

· General Motors – India

· Mitsubishi

· General Motors – India

· HM (SKSLL)

· ThyseenKrupp JMB- India (Ford)

· Mahindra and Mahindra

· Hyundai(SKSSL)

· Hond-Siel Cars India (New City)

· Tata Auto Comp (Lotus Cars)

· Tata Motors Limited

· Ashoka Leyland

No. of Employees :

Not Available

Bankers :

· Kotak Mahindra Bank Limited, 7^th Floor, Ambadeep Building, Kasturba Gandhi Marg, New Delhi – 110 001, India

· State Bank of Hyderabad, Narsinghpur Branch, Carrier Aircon Complex, Gurgaon – 122 002, Haryana, India

· Bank of Tokyo, Jeevan Vihar Building, 3, Parliament Street, New Delhi 110001.

Facilities :

Secured Loans	As on 31.03.2011 Rs. in millions	As on 31.03.2010 Rs. in millions
Rupee term loans banks secured	132.335	83.975
Rupee term loans others secured	0.000	149.201
Loans taken for other fixed assets secured	81.043	122.800
Total	213.378	355.976

Unsecured Loans	As on 31.03.2011 Rs. in millions	As on 31.03.2010 Rs. in millions
Rupee term loans others unsecured	80.000	80.000
Total	80.000	80.000

Banking Relations :	--
Auditors :
Name :	S.P. Puyri and Company Chartered Accountant
Address :	4/18, Asaf Ali Road, New Delhi-110002, India
Tel. No.:	91-11-23274888/ 23277410
Fax No.:	91-11-23272805
E-Mail :	sppori@vsnl.com
The entity exercising control over the Company :	· Somic Engineering Inc. · ZF Lemforder Gmbh, Germany · Somic Ishikawa Inc., Japan (Holding Company of Somic Engineering Inc., Japan)

CAPITAL STRUCTURE

As on 16.08.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
16500000	Equity Shares	Rs.10/- each	Rs.165.000 Millions
1000000	Preferences Shares	Rs.100/- each	Rs.100.000 Millions
	Total		Rs.265.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
15548902	Equity Shares	Rs.10/- each	Rs.155.489 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		155.489	120.617	120.617
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		452.695	260.888	240.151
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		608.184	381.505	360.768
LOAN FUNDS
1] Secured Loans		213.378	355.976	403.384
2] Unsecured Loans		80.000	80.000	80.000
TOTAL BORROWING		293.378	435.976	483.384
DEFERRED TAX LIABILITIES		40.362	33.384	36.187
TOTAL		941.924	850.864	880.339
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		688.074	718.408	507.654
Capital work-in-progress		11.319	8.331	193.377
INVESTMENT		0.000	0.000	0.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	208.839	165.266	152.363
	Sundry Debtors	264.812	184.898	217.802
	Cash & Bank Balances	19.010	11.620	10.680
	Other Current Assets	1.704	6.825	8.401
	Loans & Advances	89.204	66.186	71.919
Total Current Assets		583.569	434.795	461.165
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	266.180	241.124	213.545
	Other Current Liabilities	47.693	48.206	57.363
	Provisions	27.165	21.340	10.949
Total Current Liabilities		341.038	310.670	281.857
Net Current Assets		242.531	124.125	179.308
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		941.924	850.864	880.339

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Operating Revenue	1930.492	1582.853	1134.131
		Other Income	30.523	24.004	42.655
		TOTAL (A)	1961.015	1606.857	1176.786
Less	EXPENSES
		Consumption materials changes inventories	1425.168	1163.662	1093.836
		Manufacturing service costs	121.107	92.481
		Employee related expenses	192.239	157.885
		Administrative selling other expenses	53.850	48.431
		TOTAL (B)	1792.364	1462.459	1093.836
Less	PROFIT/(LOSS) BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		168.651	144.398	82.950
Less	INTEREST FINANCIAL CHARGES (D)		41.797	49.900	31.075
	PROFIT/(LOSS)BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		126.854	94.498	51.875
Less/ Add	DEPRECIATION/ AMORTISATION (F)		75.733	70.569	59.895
	PROFIT/(LOSS) BEFORE TAX (E-F) (G)		51.121	23.929	(8.020)
Less	TAX (H)		18.324	(2.786)	8.942
	PROFIT/(LOSS) AFTER TAX (G-H) (I)		32.797	26.715	(16.962)
	EARNINGS IN FOREIGN CURRENCY		9.462	4.280	18.880
	IMPORTS
		Components and Spares	178.460	166.515	119.876
		Capital Goods	1.317	1.143	22.922
	TOTAL IMPORTS		179.777	167.658	142.798
	Earnings/(Loss) Per Share (Rs.)		2.28	2.21	(1.41)

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	1.67	1.66	(1.44)
Net Profit Margin (PBT/Sales)	(%)	2.65	1.51	(0.71)
Return on Total Assets (PBT/Total Assets}	(%)	4.02	2.08	(0.83)
Return on Investment (ROI) (PBT/Networth)		0.08	0.06	(0.02)
Debt Equity Ratio (Total Liability/Networth)		1.04	1.96	2.12
Current Ratio (Current Asset/Current Liability)		1.71	1.40	1.64

LOCAL AGENCY FURTHER INFORMATION

FORM 8

Corporate identity number of the company	U74899DL1993PLC054930
Name of the company	SONA SOMIC LEMFORDER COMPONENTS LIMITED
Address of the registered office or of the principal place of business in India of the company	UFG-6, Indra Prakash Building, 21, Barkhamba Road, New Delhi – 110 001, India
This form is for	Modification of charge
Charge identification (ID) number of the charge to be modified	80000721
Type of charge	· Immovable property · Book debts · Movable property (not being pledge)
Particular of charge holder	State Bank of Hyderabad Narsinghpur Branch, Carrier Aircon Complex, Gurgaon – 122 001, Haryana, India E-Mail : narsingpur@sbhyd.co.in
Nature of instrument creating charge	Memorandum of deposit, supplemental agreement of loan for increase in the overall limit and supplemental agreement of hypothecation of goods and assets for increase in the overall limit
Date of instrument Creating the charge	29.09.2011
Amount secured by the charge	Rs.87.500 millions
Brief of the principal terms an conditions and extent and operation of the charge	Rate of Interest 14.50% p.a. (floating) Terms of Repayment on demand Margin cash credit: raw materials: 25% stock in progress - 25% stores and spares - 25% finished goods - 25% receivables - 50% letter of credit: margin - nil Extent and Operation of the charge working capital limits upto Rs.87.500 millions
Short particulars of the property or asset(s) charged (including complete address and location of the property)	As per terms of agreement
Particulars of the present modification	Increase of letter of credit limit facility from Ten Millions to Twenty Millions.

FIXED ASSETS

· Land

· Building

· Plant and Machinery

· Gauges and Templates

· Electrical Installation

· Furniture and Fixtures

· Office Equipments

· Computers

· Vehicles

WEB DETAILS

Company Profile

The company was initially set up as Sona Somic Components Limited in the year 1995, a joint venture with Somic Ishikawa of Japan. In 1998, Lemforder Metallwaren picked up an equity stake in this company and the company became Sona_Somic_Lemforder Components Limited (SSL). This tie-up has expanded the footprint of this company as it can now caters to both the Japanese as well as the European markets.  

Subject is a manufacturer of ball joints for steering systems and suspension components in the country. Its products are used in passenger cars, jeeps and light commercial vehicles. The company's major customers are Sona Koyo Steering, Maruti -Suzuki, Honda, Toyota and M and M.

The subject plant has the latest state-of-the-art equipment and its production method is based on the lean production system known as 'Toyota Production System' (TPS), learnt from its Japanese partner. Highly effective elements of TPS, like Just-In-Time, Kaizen, one piece at a time and Participative Management are being utilized to maximise effectiveness and efficiency. The company is using a combination of the latest technology along with a well-planned, well-executed production system to manufacture products of the highest quality for existing customers as well as to target other major entrants in the automotive sector.

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.52.23
UK Pound	1	Rs.81.55
Euro	1	Rs.69.60

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	5
--PROFITABILIRY	1~10	4
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	4
--CREDIT LINES	1~10	4
--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		44

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	-

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