MIRA INFORM REPORT

Report Date :

06.01.2011

IDENTIFICATION DETAILS

Name :	PHOTON ENERGY SYSTEMS LIMITED
Registered Office :	Plot No.775-K, Road No.45, Jubilee Hills, Hyderabad – 500 033, Andhra Pradesh
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	08.05.1995
Com. Reg. No.:	01-36134
CIN No.: [Company Identification No.]	U32103AP1995PLC036134
TAN No.: [Tax Deduction & Collection Account No.]	HYDP02168F
PAN No.: [Permanent Account No.]	AABCP9113B
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturer and Exporter of SPV Lanterns, SPV Module, IOWP, SPV Street Lighting Systems.

RATING & COMMENTS

MIRA’s Rating :

Ba (49)

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

Maximum Credit Limit :	USD 690000
Status :	Satisfactory
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is an established company having satisfactory track. 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/ Corporate Office :	Plot No. 775-K, Road No. 45, Jubilee Hills, Hyderabad – 500033, Andhra Pradesh, India
Tel. No.:	91- 40-66661337/8/9/23331337/8/9
Fax No.:	91- 40-66661340
E-Mail :	contact@photonsolar.com info@photonsolar.com finance@photonsolar.in accounts@photonsolar.in
Website :	http://www.photonsolar.com
Area :	5000 sq. ft.
Location :	Rented
Head Office :	Unit 19, Mount View Enclave, Road no 12, Banjara Hills, Hyderabad - 500 034, Andhra Pradesh, India
Tel. No.:	91-40-23331337/ 1338/ 1339
Fax No.:	91-40-23331340
E-Mail :	Solar Water Heating System: swhs@photonsolar.in Solar PV Modules: solarpv@photonsolar.in Jobs : careers@photonsolar.in Material Suppliers : purchase@photonsolar.in General Queries: contact@photonsolar.in
Corporate Office :	H. No. 8-2-686/DB/19, Mount View Enclave, Road No.12, Banjara Hills, Hyderabad – 500034, India
Factory :	Plot No. 46, Anrich Industrial Estate, IDA, Bollarum, Medak District – 502 325, Andhra Pradesh, India
Tel. No.:	91-8458-279512/ 281/ 026
Fax No.:	91-8458-279842
Area :	25900 sq. ft.
Location :	Owned
Branch Office :	Located at: · Bangalore · Pune · Coimbatore · New Delhi
Overseas Office :	Africa Office Po Box 5245, Halfway House, Midrand, SA. 1685. Tel: +27 82 852 9891 Fax: +27 86 687 3769 Email Id: africa@photonsolar.in Website: www.photonsolar.com

DIRECTORS

As on 27.09.2010

Name :	Mr. Nalamada Purushotam Reddy
Designation :	Chairman and Managing Director
Address :	Plot No. 775-K, Road No. 45, Jubilee Hills, Hyderabad – 500 033, India
Date of Birth/Age :	11.07.1936
Date of Appointment :	18.09.2008
Name :	Mr. Nalamada Gautham Kumar
Designation :	Whole Time Director
Address :	Plot No. 775-K, Road No. 45, Jubilee Hills, Hyderabad – 500 033, India
Date of Birth/Age :	05.03.1968
Date of Appointment :	18.09.2008
Name :	Mr. Raghavan Krishna Murthy
Designation :	Director
Address :	Flat No.112, Door No.6-3-1102, Manjira Apartments, Raj Bhavan Road, Hyderabad – 500 082, Andhra Pradesh, India
Date of Birth/Age :	05.12.1932
Date of Appointment :	28.09.1996
Name :	Mr. Chandra Sekhar ReddyKancharla
Designation :	Director
Address :	8-2-293/82/J/111/565/4, Jubilee Hills, Hyderabad – 500 033, India
Date of Birth/Age :	10.03.1955
Date of Appointment :	17.06.2003
Name :	Mr. Vithalbhai C. Bhavsar
Designation :	Director
Address :	304, Yadav Paradise, M. G. Road, Secunderabad – 500 003, Andhra Pradesh, India
Date of Birth/Age :	13.07.1939
Date of Appointment :	01.10.2003
Name :	Mr. Goran Fajerson
Designation :	Director
Address :	VillaVells Brunnsp Arken 2 25654 Ramlosa Sweden
Date of Birth/Age :	11.09.1943
Date of Appointment :	25.01.2005
Name :	Mr. Bhaskar Reddy Pondla
Designation :	Additional Director
Address :	15-21-32/ 3, Balaji Nagar, Kukatpally, Rangareddy – 500 072, Andhra Pradesh, India
Date of Birth/Age :	18.06.1937
Date of Appointment :	24.12.2008

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 27.09.2010

Names of Shareholders	No. of Shares
N. Purushotam Reddy	303400
R.D. Reddy	59500
N. Ram Reddy	40000
N. Usha	70000
N. Uttam Kumar Reddy	454900
Gautham Kumar	227500
J. Krishna Deva Rao (HUF)	100000
Venkat Patla	8000
K. Babu	15000
Goran Faierson	50000
Zhang Xue Xiang	20000
Analysis Securities Private Limited, india	190000
Rakesh Kumar Garg	95000
Amita Garg	95000
Total	1728300

As on 27.09.2010

Category	Percentage
Foreign holdings [Foreign institutional investors, Foreign Companies, Foreign Financial Institutions, Non-resident Indian or Overseas corporate bodies or others]	4.00
Bodies corporate	11.00
Directors or relatives of directors	67.00
Others	18.00
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer and Exporter of SPV Lanterns, SPV Module, IOWP, SPV Street Lighting Systems.

Products :

Products Description	Item Code No.
SPV Module and System Devices	8541.40.11
Solar water Heater and Systems	8419.90.10

Exports :

Countries :

• Germany
• South Africa
• Asia
• Europe
• North America

Imports :

Countries :

· Germany

· USA

Terms :

Selling :

L/C, Cash and Credit upto 60 days basis

Purchasing :

L/C and Credit upto 60 days basis

PRODUCTION STATUS (As on 31.03.2010)

Particulars	Unit	Actual Production
SPV Modules	KWP	2868
Water Heating Systems and Collctions	Ltrs	1248600

GENERAL INFORMATION

Suppliers :

· S. V. Pach Tech

· Swamy Sai Industries

· Pragati Enterprises

· Metal Kraft Roll Forming Industries

· Sri Sai Teja Anodizers

· Vaishnavi Packagings Private Limited

· Sri Sai Venkateshwara Packaging

Customers :

End Users

No. of Employees :

280 (Approximately)

Bankers :

• Dena Bank, Dundoo Chambers, R. P. Road, Secunderabad – 500003, Andhra Pradesh, India

• ICICI Bank Limited

Facilities :

Secured Loans :	31.03.2010 (Rs. in Millions)	31.03.2009 (Rs. in Millions)
Loan from IREDA for SPV Water Pumps	2.959	4.327
Working Capital Limits from Dena Bank	15.086	19.379
GE Countrywide Consumer Financial Services I	0.000	0.088
ICICI Limited	0.00	0.057
HDFC Bank Limited	1.302	0.956
Dena Bank – Term Loan	2.000	4.139
Dena Bank – Vehicle Finance	0.000	0.160
Total	21.347	29.106

Note:

· Loan from IREDA is secured by a first charge on all Fixed Assets of the Company and second charge on stocks and book debts present and future and guaranteed by the promoters.

· CC- Stocks cum Book Debts and packing Credit- Preshipment cum FBP Limit from Dena Bank is secured by hypothecation of Raw material, Goods in Process, Finished Goods, Stores and Spares and receivable present and future and second Finished Goods, Stores and Spares and Receivables present and Future and Second charge on fixed asses of the company and guaranteed by the promoters and their associates.

· Loan from GE Countrywide Consumer Financial Services Limited, ICICI Limited and Dena Bank is secured against hypothecation of vehicles.

· Term Loan from Dena Bank is secured by a first charge on the assets acquired.

Financial Institution :	Andhra Pradesh Industrial Development Corporation Limited, Parisram Bhavanam, Fateh Maidan Road, Basheerbagh, Hederabad-500 004, Andhra Pradesh, India
Banking Relations :	-
Auditors :
Name :	P. Venkateswar Rao and Associates Chartered Accountants
Address :	6-3-850/ 1, 2^ND Floor, Sirisha Plaza, Ameerpet, Hyderabad - 500 016, Andhra Pradesh, India
Tel. No.:	91-40-23414313/ 39104588
Mobile No.:	91-9989024357
E-Mail :	venkateshwarrao_pappu@rediffmail.com

CAPITAL STRUCTURE

As on 27.09.2010

Authorised Capital :

No. of Shares	Type	Value	Amount
2500000	Equity Shares	Rs.10/- each	Rs.25.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
1728300	Equity Shares	Rs.10/- each	Rs.17.283 Millions

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		17.283	16.873	16.783
2] Share Application Money		0.118	14.449	0.118
3] Reserves & Surplus		156.137	139.641	130.148
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		173.538	170.873	147.049
LOAN FUNDS
1] Secured Loans		21.347	29.106	31.011
2] Unsecured Loans		14.470	7.579	15.273
TOTAL BORROWING		35.817	36.685	46.284
DEFERRED TAX LIABILITIES		25.172	24.899	22.527
Lease Rental Advances		1.481	2.489	3.699
TOTAL		236.008	234.946	219.559
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		96.589	96.534	91.588
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		0.000	0.000	0.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	82.963	170.671	252.706
	Sundry Debtors	172.959	45.854	49.751
	Cash & Bank Balances	2.759	29.567	86.812
	Other Current Assets	39.582	3.733	1.236
	Loans & Advances	15.957	4.375	10.046
Total Current Assets		314.220	254.200	400.551
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	152.356	57.837	258.078
	Other Current Liabilities	22.445	57.951	14.502
	Provisions	0.000	0.000	0.000
Total Current Liabilities		174.801	115.788	272.580
Net Current Assets		139.419	138.412	127.971
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		236.008	234.946	219.559

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Income	790.011	1236.727	735.356
		Other Income	3.652	9.703	3.476
		TOTAL (A)	793.663	1246.430	738.832
Less	EXPENSES
		Consumption of materials and Increase/(Decrease) in Stocks	659.110	1130.256	621.006
		Payment and benefits to employees	25.668	24.099	18.837
		Manufacturing, Administrative, Selling and Other Expenses	77.481	68.510	40.478
		TOTAL (B)	762.259	1222.865	680.321
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		31.404	23.565	58.511
Less	FINANCIAL EXPENSES (D)		4.240	2.944	2.473
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		27.164	20.621	56.038
Less/ Add	DEPRECIATION/ AMORTISATION (F)		6.124	6.090	5.417
	PROFIT BEFORE TAX (E-F) (G)		21.040	14.531	50.621
Less	TAX (H)		6.970	2.667	6.474
	PROFIT AFTER TAX (G-H) (I)		14.070	11.864	44.147
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		90.401	80.908	40.563
	Deferred Tax liabilities – Assets		0.274	2.371	3.802
	BALANCE CARRIED TO THE B/S		14.070	90.401	80.908

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	1.77	0.95	5.98
Net Profit Margin (PBT/Sales)	(%)	2.66	1.17	6.88
Return on Total Assets (PBT/Total Assets}	(%)	5.12	4.14	10.29
Return on Investment (ROI) (PBT/Networth)		0.12	0.09	0.34
Debt Equity Ratio (Total Liability/Networth)		1.21	0.89	2.17
Current Ratio (Current Asset/Current Liability)		1.80	2.20	1.47

LOCAL AGENCY FURTHER INFORMATION

Review of Operations:

Turnover for the year ended 31.03.2010 was Rs.790.011 millions as against Rs.1236.727 millions in the previous year. The net profit for the year was Rs.14.070 millions a growth of 18.6% over the previous year. The company is expecting more business in the domestic market under Jawaharlal Nehru National Solar Mission for deployment of 20000 Mw of grid power and 2000 Mw of off- grid Solar applications and 20 million sq. m. solar thermal collateral are and solar lighting for 20 million households by the end of the 13the Five year plan in 2022.

Bankers Charges Report as per Registry

Corporate identity number of the company	U32103AP1995PLC036134
Name of the company	PHOTON ENERGY SYSTEMS LIMITED
Address of the registered office or of the principal place of business in India of the company	Plot No.775-K, Road No.45, Hyderabad – 500033, Andhra Pradesh, India
This form is for	Modification of charge
Charge identification number of the modified	90123965
Type of charge	Book Debts Movable Property
Particular of charge holder	Dena Bank, Dundoo Chambers, R. P. Road, Secunderabad – 500003, Andhra Pradesh, India
Nature of description of the instrument creating or modifying the charge	Agreement of Hypothecation
Date of instrument Creating the charge	19.10.2010
Amount secured by the charge	Rs.232.458 millions
Brief particulars of the principal terms an conditions and extent and operation of the charge	Rate of Interest CASH CREDIT - Base rate + 6.75% - 1.25% i.e.. 13.75% at present TERM LOAN - Base rate +6.75% + TP (0.50%) - 1.25% i.e.. 14.25% at present Terms of Repayment Cash Credit - On Demand Term Loan (Existing) Margin As per stated in agreement Extent and Operation of the charge As per stated in agreement
Short particulars of the property charged	Hypothecation Of Entire Book Debts, Raw Material, Semi Finished Goods, Finished Goods, Spares, Stock In Trade, Packing Materials Used To Manufacturing, Recievables And Other Current Assets Whole Movable Properties Of The Company Located At Plot No.46, Anrich Industrial Estate, I.D.A Bollaram, Medak District-502325
Particulars of the present modification	Under the present modification various credit facilities reduced to Rs 232.458 millions from Rs.418.088 millions

FIXED ASSETS:

· Land and Site Development

· Factory Buildings

· Plant and Machinery

· Computers

· Vehicles

· Furniture and Fixtures

· Office Equipments

· Electrical Equipments

· SPV Power Plant

· SPV Cell Cutting Machine

· SPV Water Pumps (Lease)

WEBSITE DETAILS:

PROFILE:

Subject established in 1995, is a leading manufacturer of

· Solar PV Modules

· PV Systems

· Solar Thermal Systems

The Quality Management Systems (QMS) at Photon are Certified by TÜV, to be in conformance with the ISO 9001:2000 Standards.

PV modules up to 220Wp are certified by TÜV, to be in conformance with IEC 61215 and IEC 61730 standards.

Company’s modern manufacturing facility is located near Hyderabad in the southern state of Andhra Pradesh in India.

Company’s Products are exported to a number of countries in Asia, Africa, Europe and North America.

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 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.45.20
UK Pound	1	Rs.70.27
Euro	1	Rs.59.99

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	5
--RESERVES	1~10	6
--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	YES
--AFFILIATION	YES/NO	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		49

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.