MIRA INFORM REPORT

Report Date :

26.02.2011

IDENTIFICATION DETAILS

Name :	K L STEELS PRIVATE LIMITED
Registered Office :	Z-18, Naraina, Delhi – 110 028
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	19.07.1984
Com. Reg. No.:	55-38783
CIN No.: [Company Identification No.]	u74899dl1984ptc038783
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacturer and Exporter of Ms and Galvanized Rolled Products

RATING & COMMENTS

MIRA’s Rating :

A (61)

RATING		STATUS	PROPOSED CREDIT LINE
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

Maximum Credit Limit :	USD 2900000
Status :	Good
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is an established company having fine track. Financial position of the company appears to be sound. Trade relations are reported as fair. Business is active. Payments are reported to be usually correct and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

NOTES :

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

ECGC Country Risk Classification List – April 1, 2010

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

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

LOCATIONS

Registered Office :	Z-18, Loha Mandi, Naraina, Delhi – 110 028
E-Mail :	fin.gm@klsons.in legal@klsons.in
Factory :	G.T B.S Road, Lal Quan, Ghaziabad – 201 009, Uttar Pradesh
Tel. No.:	91-120-4198401-405 / 4198442
Fax No.:	91-120-4198430

DIRECTORS

As On : 30.09.2010

Name :	Mr. Raj Bardeja
Designation :	Chairman
Address :	KD-42, Kavi Nagar, Ghaziabad – 201 001, Uttar Pradesh
Date of Birth/Age :	16.01.1962
Date of Appointment :	19.07.1984
DIN No :	00352019
Name :	Mr. Ramesh Kumar Bardeja
Designation :	Director
Address :	A-118 Central Avenue, Sainik Farms, New Delhi – 110 062
Date of Birth/Age :	27.10.1952
Date of Appointment :	19.07.1984
DIN No :	00352031
Name :	Mr. Om Prakash
Designation :	Whole Time Director
Address :	5/40 Raj Nagar, Ghaziabad – 201 001, Uttar Pradesh
Date of Birth/Age :	25.07.1958
Date of Appointment :	26.12.1984
DIN No :	00352029
Name :	Mr. Ashok Bardeja
Designation :	Whole Time Director
Address :	16-Chenader Alok, Handi Gobindgarh, Fatehgarh Sahib – 147 301, Punjab
Date of Birth/Age :	02.10.1958
Date of Appointment :	19.07.1984
DIN No :	00352026

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 30.09.2010

Names of Shareholders	No. of Shares
Mr. Raj Bardeja	5140
Mr. Ramesh Kumar Bardeja	2900
Mr. Om Prakash	4
Mr. Ashok Bardeja	4820
Mr. Kanhaya Lal	2000
Mr. Kelly Bardeja	2440
Mrs. Anuradha Raj Kumar Bardeja	1000
Mr. Nazuk Bardeja	4
Baby Siya Bardeja	2
Master Uvraj Bardeja	5
Mr. Kanhaya Lal Raj Kumar	1500
Mr. Ahok Kumar Kanhaya Lal (HUF)	1500
Mr. Raj Kumar (HUF)	1204
Mr. Ramesh Kumar (HUF)	2000
Total	24519

AS ON 30.09.2010

Equity Share Breakup		Percentage of Holding
Category
Directors or relatives of directors		100.00
	Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer and Exporter of Ms and Galvanized Rolled Products

Products :

Generic Names of principal Products of Company

Item Code No. (ITC Code)	Product Description
7216.50	Shapes and Sections
7207.19.20	Structure (Galvanised)

PRODUCTION STATUS (As on : 31.03.2010)

Particulars	Unit	Installed Capacity (On Single Shift Basis)	Actual Production
Steel Re-rolled Products (M.S Sections)	MT	96000	99043.565 (includes 25451.510 MT on Conversion for SAIL)

GENERAL INFORMATION

Customers :

· Steel Authority of India Limited (SAIL)

· DMRC (Delhi Metro Rail Construction)

· Ambuja Cement

· IOCL/HPCL

· NTPC

· L and T

· Indian Railways

· All Major PSUs and corporates.

No. of Employees :

150 (Approximatley)

Bankers :

State Bank of Patiala, 10, navyug Market, Ghaziabad – 201 001, Uttar Pradesh

Facilities :

SECURED LOAN	31.03.2010 Rs. In Millions	31.03.2009 Rs. In Millions
From State Bank of Patiala
(Against Hypothecation of Stocks and Book Debts)	233.913	5.779
Total	233.913	5.779
UNSECURED LOAN	31.03.2010 Rs. In Millions	31.03.2009 Rs. In Millions
(Other than fixed deposits)
From Directors	9.451	0.466
From Shareholders	22.347	7.366
Total	31.798	7.832

Banking Relations :	--
Auditors :
Name :	P Jain and Company Chartered Accountants
Address :	6, navyug Market, Ghaziabad – 201 001, Uttar Pradesh

CAPITAL STRUCTURE

As On : 31.03.2010

Authorised Capital :

No. of Shares	Type	Value	Amount
25000	Equity Shares	Rs. 100/- each	Rs. 2.500 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
24519	Equity Shares	Rs. 100/- each	Rs. 2.452 millions

Notes. (Included 12256 Equity Shares of Rs.100/- each issued as Bonus Shares by capitalization of profits.)

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2010	31.03.2009	31.03.2008
SHAREHOLDERS FUNDS
1] Share Capital		2.452	2.452	2.452
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		734.866	619.809	505.043
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		737.318	622.261	507.495
LOAN FUNDS
1] Secured Loans		233.913	5.779	170.416
2] Unsecured Loans		31.798	7.832	20.014
TOTAL BORROWING		265.711	13.611	190.430
DEFERRED TAX LIABILITIES		2.845	3.475	1.714
TOTAL		1005.874	639.347	699.639
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		141.467	134.289	77.348
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		0.000	2.000	2.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	703.009	332.344	522.448
	Sundry Debtors	108.073	114.469	127.137
	Cash & Bank Balances	30.081	27.273	11.345
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	169.058	99.371	85.876
Total Current Assets		1010.221	573.457	746.806
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	130.459	59.095	116.710
	Other Current Liabilities	11.796	7.716	4.926
	Provisions	3.559	3.588	4.879
Total Current Liabilities		145.814	70.399	126.515
Net Current Assets		864.407	503.058	620.291
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		1005.874	639.347	699.639

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Income	2171.700	2781.500	2700.900
		Other Income	128.148	162.728	49.927
		TOTAL (A)	2299.848	2944.228	2750.827
Less	EXPENSES
		Office Expenses
		Administrative Expenses
		Advertising Expenses
		TOTAL (B)	2117.302	2758.055	2547.667
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		182.546	186.173	203.160
Less/ Add	DEPRECIATION/ AMORTISATION (F)		8.463	7.753	7.450
	PROFIT BEFORE TAX (E-F) (G)		174.083	178.420	195.710
Less	TAX (H)		59.370	61.761	67.438
	PROFIT AFTER TAX (G-H) (I)		114.713	116.659	128.271
	Earnings Per Share (Rs.)		4693.00	4718.00	5231.49

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	4.99	3.96	4.65
Net Profit Margin (PBT/Sales)	(%)	8.02	6.41	7.25
Return on Total Assets (PBT/Total Assets}	(%)	15.12	25.21	23.68
Return on Investment (ROI) (PBT/Networth)		0.24	0.29	0.39
Debt Equity Ratio (Total Liability/Networth)		0.56	0.14	0.62
Current Ratio (Current Asset/Current Liability)		6.93	8.15	5.90

LOCAL AGENCY FURTHER INFORMATION

FINANCIAL

The company has made a net profit of Rs.174.083 millions (Previous year Rs.178.420 millions) for the year ended 31-03-2010 after depreciation of Rs.8.462 millions (Previous year Rs.7.752 millions), out of which an amount of Rs.59.370 millions (Previous year Rs.61.761 millions) has been provided for Income tax i.e, current tax Rs.60.000 millions plus deferred tax Rs.(0.630 million) (Previous year current tax Rs.60.000 millions plus deferred tax Rs.1.761 millions). A sum of Rs Nil (Previous year Rs. 0.300 million) has been provided for Fringe Benefit Tax. A sum of Rs.0.103 million (Previous year Rs.0.669 million) has been paid against Income tax/Wealth tax for previous years. Keeping in view financial needs of the company, no provision for dividend has been made (previous year nil).

After taking into account the balance profit for the last year Rs.587.099 millions, Profit and Loss Account for the year ended 31-03-10 shows a net surplus of Rs.702.156 millions which has been carried forward to Balance Sheet. The Company has made a sale of Rs.2171.700 millions as compared to Rs.2781.500 millions for the last year. The company expects increase in sales as well as in production in the next year.

form 8:-

Corporate identity number of the company

U74899DL1984PTC038783

Name of the company

K L STEELS PRIVATE LIMITED

Address of the registered office or of the principal place of business in India of the company

Z-18, Naraina, Delhi – 110 028, India

This form is for

Modification of charge

Type of charge

· Immovable property

· Book debts

· Movable property (not being pledge)

Particular of charge holder

Name :	State bank of Patiala
Address :	10, navyug Market, Ghaziabad – 201 001, Uttar Pradesh
E-Mail :	klsteels@sify.com

Nature of instrument creating charge

· Agreement of Hypothecation of goods and assets dated 08.06.2009.

· Agreement of Pledge of goods and assets dated 08.06.2009.

· Agreement of Loan for overall limit dated 08.06.2009.

· Letter regarding the grant of individual limits within the overall limit dated 08.06.2009.

· Confirmation of Equitable Mortgage dated 08.06.2009.

· Deed of Guarantee for overall limit dated 08.06.2009.

Date of instrument Creating the charge

08.06.2009

Amount secured by the charge

Rs. 290.000 millions

Brief of the principal terms an conditions and extent and operation of the charge

Rate of Interest:

Interest- 1% below BPRL rising and falling therewith a minimum of 12.75% p.a. with monthly rests.

Terms of Repayments:

One Year

Margin:

25% on Raw Materials

25% on Semi-Finished goods

25% on Finished goods

50% on Book-debts

25% on Bank Guarantee

Extent and operation of the charge:

Rs. 290 millions only, which comprises of cash credit of Rs. 240 millions and bank guarantee of Rs. 50 millions.

Others:

Monthly stock statements, QIS data, Insurance of stock at Company's cost.

Short particulars of the property charged (Including location of the property)

Hypothecation of Raw materials, Finished goods, Consumable stores, Book debts, Machinery and other assets and equitable mortgage of Land and building.

Date of instrument modifying the charge

11.03.2008

Particulars of the present modification

Amount secured increased from Rs. 215 millions to Rs. 290 millions (Cash credit limit Rs. 240 millions and B.G. limit Rs. 50 millions.) Condition-

(1) Interest-- 1% below BPRL rising and falling therewith a minimum of 12.75% p.a. with monthly rests.

(2) Margin--50% on Book Debts, 25% on stocks and 25% on bank Guarantee (Rest conditions same as earlier)

Fixed assets:

· Leasehold Land

· Freehold Land

· Building

· Furniture and Fixtures

· Plant, Machinery and Equipments

· Miscellaneous Equipments

· 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] 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.73.25
Euro	1	Rs.62.68

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	7
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	8
--RESERVES	1~10	8
--CREDIT LINES	1~10	7
--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	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		61

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.