MIRA INFORM REPORT

Report Date :

06.01.2011

IDENTIFICATION DETAILS

Name :	BHARAT SANCHAR NIGAM LIMITED
Registered Office :	Bharat Sanchar Bhawan, Harish Chandra Mathur Lane, Janpath, New Delhi – 110001
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	15.09.2000
Com. Reg. No.:	55-107739
CIN No.: [Company Identification No.]	U74899DL2000GOI107739
TAN No.: [Tax Deduction & Collection Account No.]	DELB07684F / DELB07358B / DELB04661G / DELB04650C
PAN No.: [Permanent Account No.]	AABCB5576G
Legal Form :	A Closely Held Public Limited Liability Company.
Line of Business :	Providing comprehensive range of telegraph and telecom services throughout the country.

RATING & COMMENTS

MIRA’s Rating :

Aa (75)

RATING		STATUS	PROPOSED CREDIT LINE
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

Maximum Credit Limit :	USD 3500000000
Status :	Excellent
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is the largest telecom company in the public sector. Financial position of the company is sound. Trade relations are reported as fair. Business is active. Payments are reported to be 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.

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 :	Bharat Sanchar Bhawan, Harish Chandra Mathur Lane, Janpath, New Delhi – 110001, Delhi, India
Tel. No.:	91-11-23353395
Fax No.:	91-11-23353389
E-Mail :	csgml@bsnl.com hcpant@bsnl.co.in
Website :	http://www.bsnl.co.in
Corporate Office :	10th Floor, Statesman House, B-148, Barakhamba Road, New Delhi - 110001, Delhi, India
Tel. No.:	91-11-23357760
Fax No.:	91-11-23737760
E-Mail :	dirtf@bol.net.in adgtfp@sancharnet.in
Website :	http://www.bsnl.co.in
Location :	Owned
Head Office :	5th Floor, Sanchar Bhawan, 20, Ashoka Road, New Delhi - 110001, Delhi, India
Tel. No.:	91-11-23718698 / 23032980 / 23711209
Fax No.:	91-11-23730392
E-Mail :	dirtf@bol.net.in adgtfp@sancharnet.in
Website :	http://www.bsnl.co.in
Location :	Owned
Branches :	Located at: Mumbai, Maharashtra, India Kolkata, West Bengal, India Jabalpur, Uttar Pradesh, India Richhai, Bhilai Kharagpur

DIRECTORS

As on 28.09.2010

Name :	Mr. Rajesh Wadhwa
Designation :	Whole Time Director
Address :	C-1/65, Bapa Nagar, Dr. Zakir Hussain Marg, New Delhi – 110003, Delhi, India
Date of Birth/Age :	25.05.1952
Date of Appointment :	01.08.2008
Name :	Mr. Gopal Das
Designation :	Whole Time Director
Address :	34-A, Dr. Rajendra Prasad Road, New Delhi – 110001, Delhi, India
Date of Birth/Age :	08.02.1951
Date of Appointment :	04.10.2007
Name :	Mr. Rakesh Kumar Agarwal
Designation :	Whole Time Director
Address :	T-33, Atul Grove Road, New Delhi – 110001, Delhi, India
Date of Birth/Age :	10.04.1953
Date of Appointment :	11.04.2008
Name :	Mr. Shiban Kishen Kak
Designation :	Director
Address :	Old F-9, Hyderabad Colony, Bhu, Varanasi, Uttar Pradesh, India
Date of Birth/Age :	18.04.1947
Date of Appointment :	20.02.2008
Name :	Mr. Mahesh Shah
Designation :	Director
Address :	8/1, Monica building, 9-B, Lord, Sinha Road, Kolkata – 700071, West Bengal, India
Date of Birth/Age :	25.12.1952
Date of Appointment :	20.02.2008
Name :	Mr. Sanjiv Gupta
Designation :	Director
Address :	Apartment No. 515-B, Aralias, DlF Golf and Country Club, Gurgaon, Haryana, India
Date of Birth/Age :	17.09.1961
Date of Appointment :	05.09.2008
Name :	Mr. Rabindra Kumar Mittal
Designation :	Director
Address :	B-6/3, M. S. Flat, New Delhi-110 001, Delhi, India
Date of Birth/Age :	11.08.1956
Date of Appointment :	12.02.2010
Name :	Mr. Ashish Kumar Guha
Designation :	Director
Address :	23, Poorvi Marg, 1^st Floor, Vasant Vihar, New Delhi-110 057, Delhi, India
Date of Birth/Age :	18.11.1956
Date of Appointment :	21.05.2010

KEY EXECUTIVES

Name :	Mr. Hem Chandra Pant
Designation :	Company Secretary
Date of Birth/Age :	05.01.1961
Date of Appointment :	28.11.2000

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 28.09.2010

Names of Shareholders (Equity Shares)	No. of Shares
Shukla K V	1000
Brajesh Mishra	100
Anuradha Joshi Durgapal	100
President of India	4999998400
Mishra C. S.	1000
n k Joshi	100
Sanjeev Gupta	100
A K Das	100
R N Jha	100
Mathur K. Shikha	100
S. S. singh	100

Names of Shareholders (Preference Shares)	No. of Shares
President of India	7500000000
Total	7500000000

As on 28.09.2010

Equity Share Breakup	Percentage of Holding
Category
Government (Central and State)	100.00
Total	100.00

BUSINESS DETAILS

Line of Business :	Providing comprehensive range of telegraph and telecom services throughout the country.
Products :	v Telecom Services v Telex, Telegraph, Circuits, Value Added Services v Sale of Directories, Forms and Waste Paper

GENERAL INFORMATION

No. of Employees :	363000 (Approximately)
Bankers :	v State Bank of India v Punjab National Bank v Corporation Bank v ICICI Bank v Indian Bank

Banking Relations :	-
Auditors :
Name :	Sharma Goel and Company Chartered Accountants
Address :	Y-59, Hauz, Khas, New Deklhi-110 016, Delhi, India

CAPITAL STRUCTURE

As on 28.09.2010

Authorised Capital :

No. of Shares	Type	Value	Amount
10000000000	Equity Shares	Rs.10/- each	Rs.100000.000 Millions
7500000000	Preference Shares	Rs.10/- each	Rs.75000.000 Millions
	Total		Rs.175000.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
5000000000	Equity Shares	Rs.10/- each	Rs.50000.000 Millions
7500000000	9% Non-Cumulative Preferences Shares	Rs.10/- each	Rs.75000.000 Millions
	Total		Rs.125000.000 Millions

Note:

Out of the above equity shares 4999998400 Equity Shares of Rs.10/- each and 7500000000 preference shares of Rs.10/- each were allotted as fully paid up for consideration other than cash

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		125000.000	125000.000	125000.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		739756.600	761335.800	756282.500
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		864756.600	886335.800	881282.500
LOAN FUNDS
1] Secured Loans		0.000	0.000	0.000
2] Unsecured Loans		15337.000	34138.400	33888.700
TOTAL BORROWING		15337.000	34138.400	33888.700
DEFERRED TAX LIABILITIES		1238.400	6448.400	13105.300
TOTAL		881332.000	926922.600	928276.500
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		738803.200	543208.800	546984.900
Capital work-in-progress		59652.300	49286.400	26656.200
Decommissioned Assets + Intra/ Inter Circle Remittances		14683.000	11599.300	6662.000
			604094.5
INVESTMENT		2000.000	2000.000	2000.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	50583.300	45725.800	32200.600
	Sundry Debtors	47445.700	47205.400	54655.100
	Cash & Bank Balances	303434.000	381343.000	405515.800
	Other Current Assets	8552.100	8723.900	13768.700
	Loans & Advances	139702.800	94488.000	74444.100
Total Current Assets		549717.900	577486.100	580584.300
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors
	Other Current Liabilities	427764.200	207270.200	173978.800
	Provisions	55760.200	49387.800	60632.100
Total Current Liabilities		483524.400	256658.000	234610.900
Net Current Assets		66193.500	320828.100	345973.400
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		88133.200	926922.600	928276.500

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Income	279134.400	302685.700	323595.300
		Other Income	41319.700	55433.500	56938.700
		TOTAL (A)	320454.100	358119.200	380534.000
Less	EXPENSES
		Salaries, Wages, Bonus, etc.	134541.600	113622.200	88084.700
		Managerial Remuneration	8.800	10.100	4.400
		Payment to Auditors	20.000	19.300	18.600
		Insurance Expenses	73.900	108.200	25.100
		Power & Fuel	20305.700	17799.700	16066.100
		Other Expenditure	91994.900	124176.800	126233.200
		TOTAL (B)	246944.900	255736.300	230432.100
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		73509.200	102382.900	150101.900
Less	FINANCIAL EXPENSES (D)		3516.100	4432.500	8625.400
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		69993.100	97950.400	141476.500
Less/ Add	DEPRECIATION/ AMORTISATION (F)		91967.900	85234.100	96961.000
	PROFIT BEFORE TAX (E-F) (G)		(21974.800)	12716.300	44515.500
Less	TAX (H)		(3748.300)	6967.800	14421.600
	PROFIT AFTER TAX (G-H) (I)		(18226.500)	5748.500	30093.900
	EARNINGS IN FOREIGN CURRENCY		NA	1716.600	1346.000
	IMPORTS		NA	8635.000	2451.700
	Earnings Per Share (Rs.)		(3.65)	1.15	4.44

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	(5.69)	3.55	7.91
Net Profit Margin (PBT/Sales)	(%)	(8.87)	4.20	13.76
Return on Total Assets (PBT/Total Assets}	(%)	(1.71)	1.13	3.95
Return on Investment (ROI) (PBT/Networth)		(2.54)	0.01	0.05
Debt Equity Ratio (Total Liability/Networth)		0.58	0.33	0.30
Current Ratio (Current Asset/Current Liability)		1.14	2.30	2.47

LOCAL AGENCY FURTHER INFORMATION

NOTE

The situation of the registered office of the company was changed from 10^th Floor, Statesman Hose, B – 148, Barakhama Road, New Delhi – 110001 to the present address w.e.f. 01.08.2007.

fixed assets

· land

· Buildings

· Cables

· Motor Vehicles

· Electrical Fittings

· Office machinery and Equipments

· Computer

· Furniture and Fixtures

· Software

AS PER WEBSITE DETAILS

PROFILE

Subject formed in October, 2000, is World's 7th largest Telecommunications Company providing comprehensive range of telecom services in India: Wireline, CDMA mobile, GSM Mobile, Internet, Broadband, Carrier service, MPLS-VPN, VSAT, VoIP services, IN Services etc. Presently it is one of the largest and leading public sector unit in India.

Subject has installed Quality Telecom Network in the country and now focusing on improving it, expanding the network, introducing new telecom services with ICT applications in villages and wining customer's confidence. Today, it has about 46 million line basic telephone capacity, 8 million WLL capacity, 52 Million GSM Capacity, more than 38302 fixed exchanges, 46565 BTS, 3895 Node B ( 3G BTS), 287 Satellite Stations, 614755 Rkm of OFC Cable, 50430 Rkm of Microwave Network connecting 602 Districts, 7330 cities/towns and 0.056 millions villages.

Subject is the only service provider, making focused efforts and planned initiatives to bridge the Rural-Urban Digital Divide ICT sector. In fact there is no telecom operator in the country to beat its reach with its wide network giving services in every nook and corner of country and operates across India except Delhi and Mumbai. Whether it is inaccessible areas of Siachen glacier and North-eastern region of the country. Subject serves its customers with its wide bouquet of telecom services.

Subject is numero uno operator of India in all services in its license area. The company offers vide ranging and most transparent tariff schemes designed to suite every customer. Subject cellular service, CellOne, has 55,140,282 2G cellular customers and 88,493 3G customers as on 30.11.2009. In basic services, Subject is miles ahead of its rivals, with 35.1 million Basic Phone subscribers i.e. 85 per cent share of the subscriber base and 92 percent share in revenue terms.

Subject has more than 2.5 million WLL subscribers and 2.5 million Internet Customers who access Internet through various modes viz. Dial-up, Leased Line, DIAS, Account Less Internet(CLI). Subject has been adjudged as the NUMBER ONE ISP in the country.

Subject has set up a world class multi-gigabit, multi-protocol convergent IP infrastructure that provides convergent services like voice, data and video through the same Backbone and Broadband Access Network. At present there are 0.6 million Data One broadband customers. The company has vast experience in Planning, Installation, network integration and Maintenance of Switching and Transmission Networks and also has a world class ISO 9000 certified Telecom Training Institute.

Scaling new heights of success, the present turnover of subject is more than Rs.351,820 million (US $ 8 billion) with net profit to the tune of Rs.99,390 million (US $ 2.26 billion) for last financial year. The infrastructure asset on telephone alone is worth about Rs.630,000 million (US $ 14.37 billion).

The turnover, nationwide coverage, reach, comprehensive range of telecom services and the desire to excel has made subject the No. 1 Telecom Company of India.

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	6
PAID-UP CAPITAL	1~10	8
OPERATING SCALE	1~10	8
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	9
--PROFITABILIRY	1~10	9
--LIQUIDITY	1~10	9
--LEVERAGE	1~10	8
--RESERVES	1~10	9
--CREDIT LINES	1~10	9
--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	NO
--LISTED	YES/NO	No
--OTHER MERIT FACTORS	YES/NO	Yes
TOTAL		75

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.