MIRA INFORM REPORT

 

 

Report Date :

25.02.2011

 

IDENTIFICATION DETAILS

 

Name :

THE UGAR SUGAR WORKS LIMITED

 

 

Registered Office :

Mahavir Nagar, Sangli-416 416, Maharashtra

 

 

Country :

India

 

 

Financials (as on) :

31.03.2010

 

 

Date of Incorporation :

11.09.1939

 

 

Com. Reg. No.:

11-6738

 

 

CIN No.:

[Company Identification No.]

L15421PN1939PLC006738

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

KLPT01896GM

 

 

Legal Form :

Public Limited Liability company. The company’s shares are listed on the Stock Exchanges

 

 

Line of Business :

Manufacturer of Sugar

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba (47)

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Maximum Credit Limit :

USD 3300000

 

 

Status :

Satisfactory

 

 

Payment Behaviour :

Usually Correct

 

 

Litigation :

Clear

 

 

Comments :

Subject is an established company having satisfactory track. There appears some losses being incurred by the company in current year i.e. 2009- 2010. However, networth appears to be satisfactory. 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 – 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

 

 

INFORMATION DECLINED BY

 

Name :

Mr. B. G. Kulkarni

Designation :

Finance controller

Contact No.:

91-8339-272230

Date :

23.02.2011

 

 

LOCATIONS

 

Registered Office :

Mahavir Nagar, Sangli-416 416, Maharashtra, India

Tel. No.:

91-233-2373717/2323716

Fax No.:

91-233-2323617

E-Mail :

helpdesk@ugarsugar.com

Website :

www.ugarsugar.com

 

 

Administrative Office: /Factory 1 :

Ugar Khurd, Dist :Belgaum-591 316, Karnataka, India

Tel. No.:

91-8339-272230 (5 Lines)

Fax No.:

91-8339-272232

 

 

Factory 2 :

Jewargi Unit

 

Dist: Gulbarga , Karnataka

 

 

Factory 3 :

Fragies EOU


Ugar Khurd, Dist : Belgaum, Karnataka, India

 

 

Factory 4 :

Ugar Quality Packaging

 

G-1/1, M.I.D.C., Mirjole, Ratnagiri, Maharashtra, India

Tel. No.:

91-2352-228720

Fax No.:

91-2352-228689

 

 

Branches:

Located At:

 

·         Mumbai

·         Bangalore

·         Belgaum

·         Kolhapur

 

 

DIRECTORS

 

As on 31.03.2010

Name :

Mr. R.V.Shirgaokar

Designation :

Chairman and Mentor

 

 

Name :

Mr. A. B.Kage

Designation :

Director

 

 

Name :

Mr. V. Balasubramanian (I.A.S. Retired)

Designation :

Director

 

 

Name :

Dr. M. R. Desai

Designation :

Director

 

 

Name :

Mr. S. N. Inamdar

Designation :

Director

 

 

Name :

Mr. M.G.Joshi

Designation :

Director

 

 

Name :

Mr. D.B. Shah

Designation :

Director

 

 

Name :

Mr. Sanat K. Shirgaokar

Designation :

Director

 

 

Name :

Mr. P.V. Shirgaokar

Designation :

Managing Director

 

 

Name :

Mr. Shishir S. Shirgaokar

Designation :

Executive Director

 

 

KEY EXECUTIVES

 

Name :

Shri. B. G. Kulkarni

Designation :

Company Secretary and Compliance Officer

Address :

Ugarkhurd 591 316 (Dist- Belgaum)

Tel. No.:

91-8339-272230

Fax No.:

91-8339-272232

E-Mail :

bg.kulkarni@ugarsugar.com

 

 

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

 

As on 31.12.2010

Names of Shareholders

No. of Shares

Percentage of Holding

(A) Shareholding of Promoter and Promoter Group

 

 

(1) Indian

 

 

Individuals / Hindu Undivided Family

15,682,923

13.94

Bodies Corporate

36,794,883

32.71

Sub Total

52,477,806

46.65

(2) Foreign

 

 

Total shareholding of Promoter and Promoter Group (A)

52,477,806

46.65

(B) Public Shareholding

 

 

(1) Institutions

 

 

Financial Institutions / Banks

2,880

-

Insurance Companies

554,808

0.49

Sub Total

557,688

0.50

(2) Non-Institutions

 

 

Bodies Corporate

8,967,214

7.97

Individuals

 

 

Individual shareholders holding nominal share capital up to Rs.0.100 million

47,569,913

42.28

Individual shareholders holding nominal share capital in excess of Rs.0.100 million

2,480,679

2.21

Any Others (Specify)

446,700

0.40

Non Resident Indians

335,104

0.30

Clearing Members

105,877

0.09

Trusts

5,719

0.01

Sub Total

59,464,506

52.86

Total Public shareholding (B)

60,022,194

53.35

Total (A)+(B)

112,500,000

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)

112,500,000

100.00

 

BUSINESS DETAILS

 

Line of Business :

Manufacturer of Sugar

 

 

Products :

Item Code No. (ITC Code)

170199.02

Product Description

Cane Sugar Refined

Item Code No. (ITC Code)

220720.00

Product Description

Industrial Alcohol

Potable Alcohol

Electricity

 

PRODUCTION STATUS (As on 31.03.2010)

 

Particulars

Unit

Licensed Capacity

Installed Capacity

Actual Production

Sugar

TCF

@

12500

1786430

Rectified Spirit

BL Per year

**

24369000

8593550

Denatured Spirit

BL Per year

**

Na

1695330

Potable Alcohol

BL Per year

**

9600000

8225107

Electricity

KW per day

1416000

1416000

135860687

 

"Installed Capacities - As certified by the Managing Director and accepted by the Auditors

** Licence from licensing authority (State Excise) obtained, but quantity to be produced is not restricted.

@ Licence Not Required

 

 

GENERAL INFORMATION

 

No. of Employees :

1,786 people (including Jewargi unit) comprising of 1,285 permanent, 494 seasonal and 7 badali workers. (Approximately)

 

 

Bankers :
  • Central Bank of India
  • Bank of Baroda
  • IDBI Limited
  • Bank of India
  • Axis Bank Limited
  • Union Bank of India
  • ICICI Bank Limited

 

 

 

Facilities :

Secured Loans :

 

As on 31.03.2010

Rs. in Millions

As on 31.03.2009

Rs. in Millions

From Bankers secured by hypothecation of Stores and Spares and Stock in Trade

6.039

7.825

From Bankers secured by pledge of stock of sugar

1828.367

1384.940

From Industrial Development Bank of India Limited

For Working Capital, secured by subsequent charge on Fixed Assets of the Company

293.271

300.000

From Sugar Technology Mission and Technology Development Board

 

For setting up Effluent Treatment Plant, secured by hypothecation of the said plant

9.000

12.120

From Axis Bank Limited

For financing part of the working capital and for refinancing the long term debts, secured by first pari passu charge on all movable and immovable fixed assets excluding Effluent Treatment Plant, exclusive first charge on receivables generated from sale of power

0.000

20.000

From Bank of Baroda

419.540

444.910

From Central Bank of India

For setting up a sugar factory with co-generation of power at Jewargi, secured by hypothecation of Plant and Machinery and Stores and Spares for the said project

198.644

202.118

From Axis Bank Limited Corporate Loan

For funding long term requirements for project expansion, normal capital expenditure, augmenting long term working capital and general corporate purpose, secured by first pari passu charge on all fixed assets of the Company

23.076

138.461

From Rabo International, Singapore

(Cooperative Centrale Raiffeisen Boerenleenbank B. A.)

For purchase of Sugar Ships Manufacturing Machinery, secured by hypothecation of the said machinery

24.264

80.952

From Central Bank of India

For installation of sugar machinery, secured by hypothecation of the said machinery

81.968

0.000

From Sugar Development Fund

For Modernisation and Rehabilitation

34.253

45.671

For Cane Development

Secured by exclusive second charge on all movable assets of the Company

25.000

0.000

From Central Bank of India

As Bridge Loan against Loan from SDF for Jewargi Unit to be received, secured by second charge on assets of the Jewargi Unit

201.871

0.000

Total

3145.293

2636.997

 

 

 

Banking Relations :

 

 

 

Auditors :

 

Name :

P. G. Bhagwat

Chartered Accountants

Address :

Manoj Arcade, Tilakwadi, Belgaum: 590006

 

 

Associates/Subsidiaries :

·         Ugar Consultancy Limited

·         Ugar Theatres Private Limited

·         Ugar Quality Packaging Private Limited

·         Sadashiva Sugars Limited

 

 

CAPITAL STRUCTURE

 

As on 31.03.2010

Authorised Capital :

No. of Shares

Type

Value

Amount

200000000

Equity Shares

Rs.1/- Each

Rs.200.000 Millions

 

Issued, Subscribed & Paid-up Capital :

No. of Shares

Type

Value

Amount

112500000

Equity Shares

Rs.1/- Each

Rs.112.500 Millions

 

 

The above includes

 

i. 4,97,44,200 Equity Shares of Re. 1 each allotted as fully paid bonus shares and

ii. 13,26,000 Equity Shares of Re. 1 each allotted at the time of conversion of 340 Preference "A" Shares

by capitalisation of Reserves.]

 

 

 

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

112.500

112.500

90.000

2] Share Application Money

0.000

0.000

0.000

3] Reserves & Surplus

724.303

924.667

651.381

4] (Accumulated Losses)

0.000

0.000

0.000

NETWORTH

836.803

1037.167

741.381

LOAN FUNDS

 

 

 

1] Secured Loans

3145.293

2636.997

2827.911

2] Unsecured Loans

339.906

204.063

293.794

TOTAL BORROWING

3485.199

2841.060

3121.705

DEFERRED TAX LIABILITIES

78.237

158.682

46.474

 

 

 

 

TOTAL

4400.239

4036.909

3909.560

 

 

 

 

APPLICATION OF FUNDS

 

 

 

 

 

 

 

FIXED ASSETS [Net Block]

1961.501

2158.140

2124.175

Capital work-in-progress

8.223

10.717

0.076

 

 

 

 

INVESTMENT

13.853

237.082

187.807

DEFERREX TAX ASSETS

0.000

0.000

0.000

 

 

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

 

 

 

Inventories
3202.225

1917.139

1931.145

 

Sundry Debtors
295.847

299.954

359.266

 

Cash & Bank Balances
266.518

192.808

282.638

 

Other Current Assets
206.728

335.053

279.039

 

Loans & Advances
163.238

155.832

118.556

Total Current Assets
4134.556

2900.786

2970.644

Less : CURRENT LIABILITIES & PROVISIONS
 

 

 

 

Sundry Creditors
1614.421

1112.082

1187.970

 

Other Current Liabilities
16.124

9.546

77.851

 

Provisions
87.349

148.188

107.321

Total Current Liabilities
1717.894

1269.816

1373.142

Net Current Assets
2416.662

1630.970

1597.502

 

 

 

 

MISCELLANEOUS EXPENSES

0.000

0.000

0.000

 

 

 

 

TOTAL

4400.239

4036.909

3909.560

 

 

 

 

PROFIT & LOSS ACCOUNT

 

 

PARTICULARS

31.03.2010

31.03.2009

31.03.2008

 

SALES

 

 

 

 

 

Income

4446.320

3940.998

4131.359

 

 

Other Income

42.480

129.486

221.982

 

 

TOTAL                                     (A)

4488.800

4070.484

4353.341

 

 

 

 

 

Less

EXPENSES

 

 

 

 

 

Cost of Raw Material Consumed

and Purchase of Trading Goods

4288.774

2495.432

2278.525

 

 

Manufacturing, Selling and Administration Expenses

1075.697

1007.659

1031.585

 

 

Increase/ (Decrease) in Stocks

(1176.345)

(85.188)

527.567

 

 

TOTAL                                     (B)

4188.126

3417.903

3837.677

 

 

 

 

 

Less

PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B)      (C)

300.674

652.581

515.664

 

 

 

 

 

Less

FINANCIAL EXPENSES                         (D)

237.063

185.260

231.044

 

 

 

 

 

 

PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D)                                       (E)

63.611

467.321

284.620

 

 

 

 

 

Less/ Add

DEPRECIATION/ AMORTISATION                     (F)

344.245

169.040

140.138

 

 

 

 

 

 

PROFIT BEFORE TAX (E-F)                               (G)

(280.634)

298.281

144.482

 

 

 

 

 

Less

TAX                                                                  (H)

(80.270)

149.590

0.540

 

 

 

 

 

 

PROFIT AFTER TAX (G-H)                                (I)

(200.364)

148.691

143.942

 

 

 

 

 

Add

PREVIOUS YEARS’ BALANCE BROUGHT FORWARD

60.493

64.707

41.824

 

 

 

 

 

Less

APPROPRIATIONS

 

 

 

 

 

General Reserve

0.000

1200.000

100.000

 

 

Dividend

0.000

28.125

18.000

 

 

Corporate Dividend Tax

0.000

4.780

3.059

 

BALANCE CARRIED TO THE B/S

(139.871)

60.493

64.707

 

 

 

 

 

 

EARNINGS IN FOREIGN CURRENCY

19.366

5.887

NA

 

 

 

 

 

 

IMPORTS

0.196

0.364

NA

 

 

Raw Materials

 

 

 

 

 

 

 

 

 

Earnings Per Share (Rs.)

(1.78)

1.54

NA

 

 

QUARTERLY RESULTS

 

PARTICULARS

 

30.06.2010

(1st Quarter)

30.09.2010

(2nd Quarter)

31.12.2010

(3rd Quarter)

Net Sales

1492.400

1050.720

1483.420

Total Expenditure

1328.130

1304.590

1419.690

PBIDT (Excl OI)

164.270

(253.870)

63.730

Other Income

25.350

7.000

10.270

Operating Profit

189.620

(246.870)

74.000

Interest

81.260

68.900

56.140

Exceptional Items

0.000

0.000

0.000

PBDT

108.360

(315.770)

17.860

Depreciation

70.970

69.750

69.940

Profit Before Tax

37.390

(385.520)

(52.080)

Tax

28.230

(145.070)

(23.030)

Provisions and contingencies

0.000

0.000

0.000

Profit After Tax

9.150

(240.450)

(29.050)

Extraordinary Items

0.000

0.000

0.000

Prior Period Expenses

0.000

0.000

0.000

Other Adjustments

0.000

0.000

0.000

Net Profit

9.150

(240.450)

(29.050)

 

KEY RATIOS

 

PARTICULARS

 

 

31.03.2010

31.03.2009

31.03.2008

PAT / Total Income

(%)
(4.46)

3.65

3.31

 

 
 

 

 

Net Profit Margin

(PBT/Sales)

(%)
(6.31)

7.57

3.50

 

 
 

 

 

Return on Total Assets

(PBT/Total Assets}

(%)
(4.60)

5.90

2.84

 

 
 

 

 

Return on Investment (ROI)

(PBT/Networth)

 
(0.34)

0.29

0.19

 

 
 

 

 

Debt Equity Ratio

(Total Liability/Networth)

 
6.22

3.96

6.06

 

 
 

 

 

Current Ratio

(Current Asset/Current Liability)

 
2.41

2.28

2.16

 

 

 

 

 

 

 

LOCAL AGENCY FURTHER INFORMATION

 

Details of Sundry Creditors:

 

Particulars

 

31.03.2010

(Rs. in millions)

31.03.2009

(Rs. in millions)

31.03.2009

(Rs. in millions)

Sundry Creditors
1614.421

1112.082

1187.970

GENERAL:

 

The Financial Year and Sugar Season 2009-10 was very dramatic for the entire sugar industry. As per the Agriculture Ministry's Report, during the crushing season 2009-10 the production was expected only upto 145 Lakh MT initially which lead to huge spurt in sugar prices upto January, 2010. Further Sugar Imports were allowed

duty free and sugar export was banned. Government increased the Levy Sugar Ratio from 10% to 20% to improve the quantity of sugar for public distribution and to ease the sugar prices. The price of Levy Sugar remained unchanged at Rs. 1,345 per Qtl., till 31s'' March 2010. But suddenly the scenario changed as the production estimates were changed due to late rains and the sugar production was expected around 185 Lakh MT due to which sugar prices tumbled. The cane area is expected to increase during Sugar Season 2010-11 and  the production is expected to be around 210 Lakh MT.

 

Ourtotal crushing at Ugar and Jewargi, during the season 2009-10 was 16.29 Lakh MT of sugar cane with bagging of 18.64 Lakh Qtls. of sugar with a recovery of 11.54% and 10.09% respectively. The ratio of Levy to Free has been changed to 20% Levy and 80% Free sale.

 

REASONS FOR LOSS FORTHE FY2009-10

 

The Company has suffered a loss of Rs.139.871 millions during the Financial Year 2009-10.

 

The Ugar Sugar Works Limited

 

Forward profits for previous year as compared to profit of Rs.213.398 millions during last year due to following

reasons:

 

a) The Company has paid additional cane price of Rs. 300/- (total Rs.0.002 millions) amounting to Rs.343.636 millions for the season 2008-09.

b) The average rate of Electricity exported has come down from Rs.7.48 per unit in the previous year to Rs.3.36 per Unit in current year.

c) Depreciation provided on the assets pertaining to Jewargi Unit amounted to Rs.215.522 millions and interest on Term Loans pertaining to Jewargi Unit amounted to Rs. 76.617 millions aggregating to Rs.292.139 millions i.e. depreciation and interest on Jewargi Unit during Financial Year 2009-10.

d) Higher payment of Harvesting and Transport charges amounting to Rs. 83.480 millions has increased the cost of production at Jewargi Unit and further substantial fall in ex-factory sugar prices from Rs. 3,900 per Qtl. to Rs. 2,600 per Qtl. has resulted into loss at Jewargi Unit being production cost more than the market price.

 

Management's view on future operations :

 

Although there is a loss at Jewargi Unit, the unit has performed well during the season 2009-10. They were able to crush around 2.02 Lakh MT of sugar cane and production was 2.08 Lakh Qtls of sugar at a recovery of 10.09%. The harvesting cost will be reduced in the coming season by bringing more cane from nearby area and improvement in the recovery by procuring better quality cane. Management is confident of turning the table during the coming years by improving the performance of Jewargi as well as all other units and to show profits during the coming year.

 

 

MANAGEMENT DISCUSSION AND ANALYSIS

Industrial Structure and Development:

 

Currently the sugar industry in India is covered by public, co-operative and private sector companies. Co-operative Sector accounts for nearly 55% in terms of number of factories, installed capacity and production. India is the largest consumer and the second largest producer of sugar in the world. There are over 148 sugar factories of various capacities operated this year. The ownership of sugar industry is a combination of public, private and

co-operative sectors. Sugar is produced in almost all the major Indian States. Maharashtra and UP. Contribute 70% of the country's total production. Tamilnadu, Karnataka, Andhra Pradesh, Bihar and Gujarat are the other major sugar producing States. The sugar prices are very sensitive from the common man's point of view. The Sector is therefore, highly regulated both by the Central and State Governments. The Government has increased

levy and free sale sugar ratio @ 20:80 percent during the financial year.

 

The sugar production in the country during the year will be around 185 Lakh tonne compared to 146 Lakh tonne in the previous year. The sugar production is likely to increase during the year 2010-11.

 

Opportunities and Threats:

Opportunities:

Increased plantation area:

 

The increase in plantation will enable us to improve their capacity utilisation they expect to crush around 20 Lakh tonnes (including Jewargi) of sugarcane.

 

IML Marketing:

There is a scope for improving the marketing of IML Products. Their new brand "Sand Piper Whisky" was well received by the market, which has helped in improvement of existing sales. With the streamline of sales efforts,   their sales have improved substantially in Karnataka. They have also arrangements for sale of IML in Kerala state. Recently, they have also entered into an agreement for bottling of their products at Chamundi Distillery and Winery, Bangalore. They are also looking up for entering into Andhra Pradesh and Delhi liquor market.

 

Demand for Electricity:

 

With the ever increase in demand for electricity for next 5 years, they see an opportunity of generating more electricity. At their Jewargi Unit, they have multi-fuel boiler which they can run through out the year on coal. They are also converting one bagasse based boiler into multi-fuel boiler at Ugarto take advantage of electricity demand.

 

Segment wise Performance:

Sugar

 

During the current year the Company has crushed 15.75 Lakh MT (Previous Year 13.19 Lakh MT) including Jewargi and producing 17.86 Lakh Qtls. (Previous Year 14.68 Lakh Qtls.) including Jewargi at a recovery of \ 1.54 % and 10.09 % at Ugar and Jewargi respectively.

 

Industrial and Potable Alcohol:

 

The Company has produced Industrial and Potable Alcohol during the year 185.13 Lakh BLS (Previous Year 191.07 Lakh BLS). The sale of Potable Alcohol in Karnataka has increased due to the sales efforts put in by their sales team. The newly introduced Sandpiper Whisky was well received by the market and has helped in improving the sales. Sale of Potable Alcohol in Kerala through K.S. and Kaycee Distilleries is also satisfactory and they are also planning to enter in the Andhra Pradesh and Delhi liquor market.

 

Co-generation:

 

The generation during this year at Ugar and Jewargi was 1,358.60 Lakh KW (Previous Year 1,247.71 Lakh KW) and export 772.57 Lakh KW (Previous year 697.11 Lakh KW). The performance was affected due lower power rates at the beginning of season, which has forced us to produce and export less quantity of electricity. The realization started improving during April,2010, however the Government of Karnataka invoked section 11 compelling supply of power to them only. They have supplied power through open access to M/s Tata Power   Trading Company Limited, upto 30'" April, 2010, there after to HESCOM.

 

Fixed Assets:

 

·         Land

·         Building

·         Machinery

·         Furniture and Fixture

·         Vehicle

 

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.73.54

Euro

1

Rs.62.39

 

 

SCORE & RATING EXPLANATIONS

 

SCORE FACTORS

 

RANGE

POINTS

HISTORY

1~10

7

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

5

--CREDIT LINES

1~10

5

--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

YES

--OTHER MERIT FACTORS

YES/NO

YES

TOTAL

 

47

 

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.