MIRA INFORM REPORT

Report Date :

13.01.2011

IDENTIFICATION DETAILS

Name :	R. S. ELECTRONICS LIMITED
Registered Office :	69/A, 1^st Phase Electronics City, Hosur Road, Banglore-560001, Karnataka.
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	11.07.1989
Com. Reg. No.:	11-010233
CIN No.: [Company Identification No.]	U85110KA1989PLC010233
Legal Form :	A Closely Held Public Limited Liability Company.
Line of Business :	Manufacturer of Automobile Components.

RATING & COMMENTS

MIRA’s Rating :

Ba (45)

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

Maximum Credit Limit :	USD 130000
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

INFORMATION PARTED BY

Name :	Mrs. Abhirami
Designation :	Accounts Department
Date :	12.01.2011

LOCATIONS

Registered Office/ Factory :	69/A, 1^st Phase Electronics City, Hosur Road, Banglore-560001, Karnataka, India
Tel. No.:	91-80-28520477/ 28521475
Fax No.:	91-80-28520020
E-Mail :	rsel@vsnl.com
Website :	www.rselectronicsltd.com
Area :	½ acres
Location :	Owned

DIRECTORS

As On : 29.09.2010

Name :	Mr Kondappa Shivaram Reddy
Designation :	Managing Director
Address :	Devarachikkanahalli, Bilakahalli Post, Banglore-560076, Karnataka, India
Date of Birth/Age :	18.05.1952
Date of Appointment :	11.07.1989
DIN No :	01865171
Name :	Mrs. Shivarama Reddy Savitha
Designation :	Director
Address :	Devarachikkanahalli, Bilakahalli Post, Banglore-560076, Karnataka, India
Date of Birth/Age :	18.06.1977
Date of Appointment :	31.07.1999
DIN No :	01865158
Name :	Mrs. Shivarama Reddy Sandhya
Designation :	Director
Address :	Devarachikkanahalli, Bilakahalli Post, Banglore-560076, Karnataka, India
Date of Birth/Age :	02.08.1978
Date of Appointment :	31.07.1999
DIN No :	01865139
Name :	Mr. Shivarama Reddy Rajalakshmi
Designation :	Director
Address :	Devarachikkanahalli, Bilakahalli Post, Banglore-560076, Karnataka, India
Date of Birth/Age :	15.12.1982
Date of Appointment :	27.09.2004
DIN No :	01865123
Name :	Mr. Chinniappa Sarasa
Designation :	Alternate Director to Ms. Sandhya
Address :	Devarachikkanahalli, Bilakahalli Post, Banglore-560076, Karnataka, India
Date of Birth/Age :	01.07.1954
Date of Appointment :	27.09.2004
DIN No :	01865144
Name :	Mr. G Gundappa
Designation :	Director
Address :	810, 35^th Cross, 9^th Main, 4^th Block Jayanagar, Banglore, Karnataka, India
Date of Appointment :	11.07.1999

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 29.09.2010

Names of Shareholders	No. of Shares
Kondappa Shivaram Reddy	26200
K Raghu Rama Reddy	3000
G Gundappa	250
Sarasa Shivarama Reddy	2050
G. Rupa	3050
K. V. Shankar	1020
B. R. Savithramma	1200
K. S. Venkatesh	1200
Anitha Venkatesh	1200
B. K. Anantharam	1200
K. S. Srilakshmi	1200
S. Shakunthala	350
A. C. Shamala	100
M. Jayaraj	100
R. Chikkegowda	100
N. Ganesh	100
Y. N. Nataraju	100
A. R, Rukmani	100
Gayathri Devi	100
T R Prabhudev	50
Meenashivalingaiah	100
R Mavarappa	100
Malathi B L	100
Roopa B L	100
Amarendra	100
A C Prasanna	100
K Hemalatha	100
K N Seetharam	100
Shankar Narayana Shetty	100
Savitha	2000
Sandhya	2000
Rajalakshmi	2000
Total	49570

AS ON 29.09.2010

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

BUSINESS DETAILS

Line of Business :	Manufacturer of Automobile Components.
Products :	Stainless Steel Nickel Alloy Brass Copper Aluminum Mild Steel
Exports :
Products :	Automobile Components
Countries :	United Kingdom
Imports :
Products :	Raw Materials
Countries :	United Kingdom
Terms :
Selling :	L/C, Cash, Credit
Purchasing :	L/C, Cash, Credit

GENERAL INFORMATION

Customers :

Wholesalers

No. of Employees :

39 (In Office-11 and In Factory -28) (Approximately)

Bankers :

State Bank of India

Overseas Branch No 65, ST. Marks Road, Banglore-560001, Karnataka, India

Facilities :

SECURED LOAN	31.03.2010 Rs. In Millions	31.03.2009 Rs. In Millions
Bank Loans (Secured by immovable property, Fixed Assets, Inventories and Receivables besides secured by personal guarantees of Directors)
State Bank of India Overseas Branch	4.467	3.096
Total	4.467	3.096
UNSECURED LOAN	31.03.2010 Rs. In Millions	31.03.2009 Rs. In Millions
From Directors	5.170	5.728
Total	5.170	5.728

OD Limit : Rs. 7.000 millions

LC Limit : Rs. 3.000 millions

Banking Relations :	--
Auditors :
Name :	MNS and Company Chartered Accountant
Address :	L-89, 15^th cross, VI Sector, HSR Layout, Banglore-560102, Karnataka, India.

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
100000	Equity Shares	Rs. 100/- each	Rs. 10.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
49570	Equity Shares	Rs. 100/- each	Rs. 4.957 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		4.957	4.957	4.957
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		29.331	26.373	27.312
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		34.288	31.330	32.269
LOAN FUNDS
1] Secured Loans		4.467	3.096	3.951
2] Unsecured Loans		5.170	5.728	5.199
TOTAL BORROWING		9.637	8.824	9.150
DEFERRED TAX LIABILITIES		0.267	0.465	1.023
TOTAL		44.192	40.619	42.442
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		22.180	23.205	27.232
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	10.667	9.750	9.641
	Sundry Debtors	15.064	7.315	6.109
	Cash & Bank Balances	0.803	0.161	0.223
	Other Current Assets	0.300	0.300	0.300
	Loans & Advances	3.412	1.976	2.984
Total Current Assets		30.246	19.502	19.257
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	6.894	1.925	2.749
	Other Current Liabilities	1.330	0.163	1.296
	Provisions	0.000	0.000	0.000
Total Current Liabilities		8.234	2.088	4.045
Net Current Assets		22.012	17.414	15.210
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		44.192	40.619	42.442

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Income	38.625	25.205	27.105
		Other Income	0.337	0.564	0.382
		TOTAL	38.962	25.769	27.487
Less	EXPENSES
		Cost of Materials	17.080	11.900	11.606
		Manufacturing Expenses	1.770	1.243	1.565
		Employees Remuneration	6.516	6.678	6.132
		Increase/(Decrease) in Finished Goods	3.396	(0.862)	0.007
		Selling and Distribution Expenses	1.899	2.333	2.144
		TOTAL	30.661	21.293	21.454
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION		8.301	4.476	6.033
Less	FINANCIAL EXPENSES		1.078	1.360	1.208
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION		7.223	3.116	4.825
Less/ Add	DEPRECIATION/ AMORTISATION		2.997	4.378	4.205
	PROFIT BEFORE TAX		4.226	(1.262)	0.620
Less	TAX		1.267	(0.323)	0.257
	PROFIT AFTER TAX		2.959	(0.939)	0.363
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		24.373	25.312	24.947
	BALANCE CARRIED TO THE B/S		27.332	24.373	25.310
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	2.092	NA	NA
	TOTAL EARNINGS		2.092	NA	NA
	IMPORTS VALUE		1.964	3.416	3.641
	Earnings Per Share (Rs.)		0.0005967	(0.0001895)	0.0000735

Expected Sales (2010 -2011) : Rs. 55.000 millions

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	7.59	(3.64)	1.32
Net Profit Margin (PBT/Sales)	(%)	10.94	(5.01)	2.29
Return on Total Assets (PBT/Total Assets}	(%)	8.06	(2.96)	1.33
Return on Investment (ROI) (PBT/Networth)		0.12	(0.04)	0.02
Debt Equity Ratio (Total Liability/Networth)		0.53	0.36	0.44
Current Ratio (Current Asset/Current Liability)		3.67	9.34	4.76

LOCAL AGENCY FURTHER INFORMATION

SUNDRY CREDITORS DETAILS

(Rs. In Millions)

PARTICULARS	31.03.2010	31.03.2009	31.03.2008
For Purchases	5.817	1.111	1.966
For Expenses	1.077	0.814	0.783
Total	6.894	1.925	2.749

FORM 8

Corporate identity number of the company	U29299KA1989PLC010233
Name of the company	R. S. ELECTRONICS LIMITED
Address of the registered office or of the principal place of business in India of the company	69/A, 1^st Phase Electronics City, Hosur Road, Banglore-560001, Karnataka, India
This form is for	Modification of charge
Type of charge	Immovable property Book debts Movable property (not being pledge) Floating charge
Particular of charge holder	State Bank of India Overseas Branch No 65, ST. Marks Road, Banglore-560001, Karnataka, India
Nature of instrument creating charge	Agreement of loan cum hypothecation form SME-2 and link letter SME-12 letter confirmation for creation of mortgage by deposit of titile deeds
Date of instrument Creating the charge	07.01.2008
Amount secured by the charge	Rs.13.100 millions
Brief of the principal terms an conditions and extent and operation of the charge	Rate of interest Rate : 1) wcl-at 1% above sbar with a minimum of 13.75% p.a. rising or falling there with on daily products with montely rests present effective rate13.75% per annum. 2) Penal interest for non compliance of terms of sanction : max 2% per annum over the normal rate. Prepayment penalty as per terms of sanction Terms of repayment Wcl - on demand. Advance is for a period of 12 months and subject to review as per Sanction. Margin Rm - imported 10% Rm - indigenous /domestic receivables -25% Lc/bg - 10% Finishedgoods - 33.33%, Semifinished goods -50%, Extent and operation of the charge Exclusive first charge on the assets of the company and to the full extent. Other Cash credit (stocks) rs.4.000 millions, cash credit (receivables)rs.3.000 millions, letter of credit Rs. 6.000 millions, bank gaurantee rs. 0.100 millions total limit of rs. 13.100 millions
Short particulars of the property charged (Including location of the property)	Hypothecation of company’s present and future movable assets and current assets like stocks, raw materials, semi finished and finished goods, book debts, receivables, outstanding monies, bills, right, stores, components, furniture and fittings; other movables, plant and machinery, vehicles and assets to be purchased out of bank finance Equitable mortgage immovable property of situate at no 69/A, 1^st Phase, Electronic City, Hosur Road, Bangalore.
Charge identification number of the charge to be modified	90193725
Particulars of the present modification	The amount secured by the charge stands reduced from Rs. 14.100 millions The securities described and detailed in Col No 14 here in above continue for the revised limit. All other terms and conditions remain uncharged.

TRADE REFERANCE :

Highline Pens Private Limited

FIXED ASSTES :

• Factory – Building
• Office – Building
• Borewell
• Furniture and Fixtures
• Plant and Machinery
• Imported- Machine
• Indigenous – Machine
• Electrical Fittings
• Measuring Equipment
• Office Equipments
• Air Conditioner
• Office Appliance
• Vehicle
• Computer

WEB SITE DETAILS :

PROFILE

R S Electronics Limited is located at Electronic City Bangalore, well known Silicon City started in the year 1989 to manufacture High Precision Deep Drawn Pressed Metal Parts for Electron Gun of B/W Television. Later on the services were extended to other applications like metal Parts for Electron gun of Colour Television, Pens, Thermistors Automotives, General Electricals. 

R S Electronics Limited is a leading manufacturer of High Precision Deep Drawn Components with a vision to provide Quality, Value and Services to their Customers.

PRODUCTS

R S Electronics produces products of highest quality. They can supply the metal parts as per customer's design.

They can manufacture components from different materials mainly Stainless Steel, Mild Steel, Nickel Alloy, Brass, Copper and Aluminium. The components can be produced with a thickness range of 0.075mm to 1.0 mm and length of deep draw up to 63 mm.

All their products are subjected to stringent quality measures as per the ISO Standards.

FACILITIES

They have High Speed Transfer Presses Ranging from 1 Ton to 6 Tons and having 10 to 13 Workstations. Apart from these they have Power Presses of Capacity from 5 to 30 Tons.

Hydro Pneumatic Presses, Thread Forming Machine, and Spot weld machines.

They are equipped with In-house Tool Design and In-house Tool Manufacturing of required tooling which has enabled them to serve as the reliable source for High Precision Deep Drawn Metal parts and Metal Stampings/Pressed Components.

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.45.16
UK Pound	1	Rs.70.64
Euro	1	Rs.58.68

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	5
--PROFITABILIRY	1~10	5
--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	YES
--AFFILIATION	YES/NO	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		45

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.