MIRA INFORM REPORT

Report Date :

14.01.2011

IDENTIFICATION DETAILS

Name :	KARMA INDUSTRIES
Registered Office :	F-90/ 23, (First Floor), Okhla Industrial Area, Phase 1, New Delhi – 110 020
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	22.03.2006
IEC No.:	0506017796
CST No.:	SOL CST-10530 dated 07 August 2000
PAN No.: [Permanent Account No.]	AAHFK8818K
Legal Form :	Partnership concern with an unlimited liability of the partners
Line of Business :	Manufacturer, Trader and Importer of Electric Components like CFL Lamps.

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 180000
Status :	Satisfactory
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is an established partnership concern having satisfactory track. Trade relations are reported as fair. Business is active. Payments are reported to be usually correct and as per commitments. The concern 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 :	Mr. Kuldeep Asthana
Designation :	Manager
Contact No.:	91-9278341409
Date :	08.01.2011

Name :	Mr. Vipin Jolly
Designation :	Manager
Contact No.:	91-9810777755
Date :	08.01.2011

LOCATIONS

Registered Office :	F-90/ 23, (First Floor), Okhla Industrial Area, Phase 1, New Delhi – 110 020, India
Tel. No.:	91-11-40526504/ 40526505/ 41629764/ 41629759
Mobile No.:	91-9278341409 (Mr. Kuldeep Asthana)
Fax No.:	91-11-41629753
E-Mail :	jollytv@gmail.com ecoglolites@gmail.com
Website :	www.ecoglolites.com
Area :	1200 sq. ft.
Location :	Rented
Factory :	Village Thana, Tehsil Nalagarh, District Solan – 173 212, Himachal Pradesh, India
Area :	10000 sq. ft.
Location :	Owned
Branches :	41, Dhuleshwar Gargen, C Scheme, Jaipur, Rajasthan-302 001, India
Tel. No.:	91-141-5125773
Location :	Rented

PARTNERS

Name :	Mr. Virendra Jolly
Designation :	Partner
Address :	7, Civil Lines, Rampur, Uttar Pradesh, India
Date of Birth/Age :	55 Years
Qualification :	Graduate
Experience :	30 Years
Name :	Mr. Vipin Jolly
Designation :	Partner
Address :	B-345, New Friends Colony, New Delhi, India
Date of Birth/Age :	65 Years
Qualification :	Graduate
Experience :	40 Years
Name :	Mr. Kapil Jolly
Designation :	Partner
Address :	7, Civil Lines, Rampur, Uttar Pradesh, India
Date of Birth/Age :	30 Years
Qualification :	Graduate
Experience :	5 Years

KEY EXECUTIVES

Name :	Mr. Vipin Jolly
Designation :	Manager

BUSINESS DETAILS

Line of Business :	Manufacturer, Trader and Importer of Electric Components like CFL Lamps.
Products:	· CFL · Radios · Inverter
Brand Name:	Jolly
Exports :
Products :	Radios
Countries :	Ethiopia
Imports :
Products :	· Glass Tube · Phosphor Powder · Nickel Chrome Wire · Glass Tube · Electronic Components · Phosphor Powder
Countries :	China, Austria, Vietnam, Germany, Thailand, Japan
Terms :
Selling :	L/C, Cash and Credit (30 to 60 to 90 Days)
Purchasing :	L/C, Cash and Credit (30 to 60 to 90 Days)

GENERAL INFORMATION

Suppliers :

· L. Lighting Glass Company Limited

· Nichia Corporation

· Gebauer and Griler Metal Work

· Rang Dong Lighting Source

· Jilin Sino Microelectronics

· Yuyao Shaghao International

· Osram

· Electro India

· Noble Industries

· P. K. Industries

· Anand Paper Agency

· Astra Lighting Limited

· Deep Gases

· Hind Rubber Industries

· Metal Cap Industries

· Dee Pee Enterprises

· Himachal Gases

· Garg Electronics

Customers :

· Wholesalers

· Retailers

· OEM’s

· Glorious PLC, Ethiopia

No. of Employees :

150 (Office-10, Factory-135, Branch-5)

Bankers :

Punjab National Bank, Branch Naraina Vihar, New Delhi, India

Facilities :

Secured Loans :	As on 31.03.2010 Rs. in Millions	As on 31.03.2009 Rs. in Millions
From a Scheduled Bank
Term Loan Secured against Land, Building, Plant and Machinery and Other Assets	33.914	38.946
Working Capital Secured against Stock, and Book Debts	28.497	36.979
Total	62.411	75.925

Unsecured Loans :	As on 31.03.2010 Rs. in Millions	As on 31.03.2009 Rs. in Millions
From Other than partners	7.600	0.000
Total	7.600	0.000

Banking Relations :	-
Auditors :
Name :	Sapra and Associates Chartered Accountants
Address :	23, Prakash Apartments, 5, Ansari Road, Daryaganj, Delhi
Tel. No.:	91-41563112/13/14
Mobile No.:	91-9810035236
E-Mail :	sapra.kalra@yahoo.co.uk
Associates/Subsidiaries :	Jolly Videotronics Address: Rampur, Uttar Pradesh, India

CAPITAL STRUCTURE

PARTNERS CAPITAL ACCOUNT

Particulars	31.03.2010 (Rs. In Millions)
As per Balance Sheet	4.061
Additional During the year	6.366
	10.427
Withdrawals During the year	0.000
	10.427
Less: Share of Loss	2.842
	7.585
SH VIPIN JOLLY
As per Balance Sheet	18.806
Additional During the year	6.367
	25.173
Withdrawals During the year	0.000
	25.173
Less: Share of Loss	2.842
	22.331
SH VIRENDRA JOLLY
As per Balance Sheet	10.406
Additional During the year	6.367
	16.773
Withdrawals During the year	0.000
	16.773
Less: Share of Loss	2.842
	13.931
Total	43.847

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2010	31.03.2009
SHAREHOLDERS FUNDS
1] Partners Capital		43.848	33.274
2] Share Application Money		0.000	0.000
3] Reserves & Surplus		0.000	0.000
4] (Accumulated Losses)		0.000	0.000
NETWORTH		43.848	33.274
LOAN FUNDS
1] Secured Loans		62.411	75.925
2] Unsecured Loans		7.600	0.000
TOTAL BORROWING		70.011	75.925
DEFERRED TAX LIABILITIES		0.000	0.000
TOTAL		113.859	109.199
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		79.673	87.453
Capital work-in-progress		0.000	0.000
INVESTMENT		0.000	0.000
DEFERREX TAX ASSETS		0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	55.299	54.889
	Sundry Debtors	9.341	10.041
	Cash & Bank Balances	0.218	0.073
	Other Current Assets	0.000	0.000
	Loans & Advances	5.449	6.298
Total Current Assets		70.307	71.301
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	32.771	45.735
	Other Current Liabilities	3.350	3.820
	Provisions	0.000	0.000
Total Current Liabilities		36.121	49.555
Net Current Assets		34.186	21.746
MISCELLANEOUS EXPENSES		0.000	0.000
TOTAL		113.859	109.199

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009
	SALES
		Income	197.996	122.680
		Other Income	0.791	0.184
		TOTAL (A)	198.787	122.864
Less	EXPENSES
		Expenses on Trading Account	168.801	102.802
		Personnel	12.671	5.941
		Administrative , Selling, Distribution	5.574	7.480
		TOTAL (B)	187.046	116.223
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		11.741	6.641
Less	FINANCIAL EXPENSES (D)		8.770	8.105
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		2.971	(1.464)
Less/ Add	DEPRECIATION/ AMORTISATION (F)		11.497	12.984
	NET LOSS		(8.526)	(14.448)

Expected Sales (2010-2011) : Rs.220.000 millions

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009
PAT / Total Income	(%)	(4.29)	(11.76)
Net Profit Margin (PBT/Sales)	(%)	(4.31)	(11.78)
Return on Total Assets (PBT/Total Assets}	(%)	(5.68)	(43.42)
Return on Investment (ROI) (PBT/Networth)		(0.19)	(0.43)
Debt Equity Ratio (Total Liability/Networth)		2.42	3.77
Current Ratio (Current Asset/Current Liability)		1.95	1.44

LOCAL AGENCY FURTHER INFORMATION

Trade reference:

· Indoasian, New Delhi

· Khaitan Electrical, New Delhi

Fixed Assets:

· Land

· Building

· Diesel Generating Set

· Vehicle

· Lab Equipment and Instruments

· Refrigerator and Cooling Equipments

· Tolls and Implement

· Furniture and Fixture

· Intangible Assets

Website Details:

They are a prominent manufacturer, supplier and exporter of consumer products and have sculpted a significant position in the Indian Lighting Industry. In sync with the present market requirements- They offer a comprehensive range of luminaries like compact fluorescent light bulbs, energy saving lamps etc.

They are capable of successfully catering to both the small as well as bulk requirements of the market. With their strong logistics support and wide distribution network, they are capable to deliver their orders within time to their customers. Stringent quality control measures at different stages of production ensure conformance of their products to international quality standards.

By achieving excellence in quality and offering zero-defect, high performance products have won the trust of discerning customers the world across.

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.45.13
UK Pound	1	Rs.71.05
Euro	1	Rs.59.10

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	NO
--AFFILIATION	YES/NO	YES
--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.