MIRA INFORM REPORT

Report Date :

31.01.2011

IDENTIFICATION DETAILS

Name :	PRAGATI OFFSET PRIVATE LIMITED
Registered Office :	17, Red Hills, Hyderabad - 500 004, Andhra Pradesh
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	17.02.1988
Com. Reg. No.:	01-008319
CIN No.: [Company Identification No.]	U24220AP1988PTC008319
TAN No.: [Tax Deduction & Collection Account No.]	HYDP00062G
Legal Form :	Private Limited Liability Company
Line of Business :	Subject is engaged in Printing of Stationery.

RATING & COMMENTS

MIRA’s Rating :

Ba (51)

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

Maximum Credit Limit :	USD 4200000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well-established and reputed company having satisfactory track. Financial position of the company appears to be 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

INFORMATION PARTED BY

Name :	Mr. Deepak
Designation :	Accounts Departments
Date :	28.01.2011

LOCATIONS

Registered Office/ Factory :	17, Red Hills, Hyderabad - 500 004, Andhra Pradesh, India
Tel. No.:	91-40-23304835
Fax No.:	91-40-23390230
E-Mail :	info@pragati.com
Website :	http://www.pragati.com
Area :	7000 Sq.ft. (Owned)
Branch 1 :	B-22 Royal Industrial Estate, Naigum X Roads, Wadala, Mumbai - 400 031, Maharashtra, India
Tel. No.:	91-22-24115711
Area :	26200 Sq.ft. (Owned)
Branches :	Located at : v Geetha Nilaya, No. 205, 3^rd Cross, Domiur Layout, Bangalore-560071 Tel. No. : 91-80-25356742 v P-54 And 55, Kasba Industrial Estate, Phase II, Kolkata-700107 Tel. No. :91-33-24431501 v B/22, Royal Industrial Estate, Naigaum X Road, Wadala, Mumbai -400031 Tel. No. :91-22-24115711/24115712 v 207-208, Rakesh Deep, 11 Yusuf Sarai Commercial Complex, New Delhi-110049 Tel. No. :91-11-41841661 v Flat No. 10, Vishnu Prasanna Heights, 36/2/1, Karve Nagar, Pune -411052 Tel. No. :91-20-25436634 v Empire State Building 350, Fifth Avenue, Suite 3304,New York 10118, USA Tel. No. : 212971313/6462506228

DIRECTORS

As on 29.09.2010

Name :	Mr. P. Hanumantha Rao
Designation :	Director
Address :	11-5-401, Hillview, Red Hills, Khairtabad, Hyderabad-500004, Andhra Pradesh, India
Date of Birth :	06.07.1925
Date of Appointment :	17.02.1988
Name :	Mr. Paruchuri Narendra
Designation :	CEO / Jt. Managing Director
Address :	11-5-401, Hillview, Red Hills, Khairtabad, Hyderabad - 500004
Date of Birth :	06.07.1925
Date of Appointment :	17.02.1988
Name :	Mr. Paruchuri Mahendra
Designation :	Managing Director
Address :	11-5-401, Hillview, Red Hills, Khairtabad, Hyderabad - 500004
Date of Birth :	16.06.1957
Date of Appointment :	17.02.1988
Name :	Paruchuri Harsha
Designation :	Executive Director
Address :	11-5-401, Hillview, Red Hills, Khairtabad, Hyderabad - 500004
Date of Birth :	24.02.1979
Date of Appointment :	01.09.2000
Name :	Ms. P. Sasikala
Designation :	Director
Address :	11-5-401, Hillview, Red Hills, Khairtabad, Hyderabad - 500004
Date of Birth :	24.04.1924
Date of Appointment :	17.02.1988
Name :	Mr. Nagendra Nadella Rao
Designation :	Director – Press Operations
Address :	F No.14/15, Maturu Apartments, A C Guards, Hyderabad-500004, Andhra Pradesh, India
Date of Birth/Age :	15.09.1959
Date of Appointment :	01.06.2004
Name :	Ms. Seetha Laxmi Paruchuri
Designation :	Director
Address :	11-5-401, Hill View, Red Hills, Hyderabad-500004, Andhra Pradesh, India
Date of Birth/Age :	24.04.1924
Date of Appointment :	17.02.1988
Name :	Mr. Ramakrishna Prasad Kodali
Designation :	Director – IT and Prepress
Address :	10-5-3/4, Flat No.303, KK Heights, Masabtank, Hyderabad-500028, Andhra Pradesh, India
Date of Birth/Age :	10.08.1964
Date of Appointment :	01.06.2004
Date of Ceasing :	03.07.2009

KEY EXECUTIVES

Name :	Mr. Deepak
Designation :	Accounts Departments

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 29.09.2010

Names of Shareholders	No. of Shares
Paruchuri Mahendra	2632
Paruchuri Narendra	3557
P. Hanumantha Rao	2611
Seetha Laxmi Paruchuri	3650
Paruchuri Harsha	1575
P. Sasikala	2929
Nagendra Nadella Rao	1012
P. Alekhya	1575
P. Hemanth	1575
P. Swathi	1575
P. Hanumatha Rao - HUF	4440
P. Mahendra – HUF	5847
P. Narendra – HUF	4947
P. Nagaman	3307
Total	41232

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 :	Subject is engaged in Printing of Stationery.
Imports :
Products :	Raw Materials
Countries :	Japan Germany Netherlands US
Terms :
Selling :	Cash / Credit
Purchasing :	L/C / Cash / Credit

GENERAL INFORMATION

Customers :

OEM’s, Corporates

No. of Employees :

540 (In Office 440) (In Branches 100) (Approximately)

Bankers :

• ICICI Bank Limited, Himayat Nagar Branch, Hyderabad, Andhra Pradesh, India

Tel. No. 91-40-23227128

• The Bank of Nova Scotia, Banjara Hills, Hyderabad, Andhra Pradesh, India

Tel. No. 91-40-23372265

• Andhra Bank, Sultan Bazar, Koti, Hyderabad, Andhra Pradesh, India

Tel. No. 91-40-24757363

Facilities :

Secured Loan	As on 31.03.2010 (Rs. in Millions)	As on 31.03.2009 (Rs. in Millions)
From The Bank of Nova Scotia (Pledge against Fixed Deposit)	22.867	0.000
Total	22.867	0.000
Unsecured Loan
From Directors	19.980	17.012
From Others	0.501	1.663
Total	20.481	18.675

Banking Relations :	--
Auditors :
Name :	S. Daga and Company Chartered Accountant
Address :	403, Paigh Plaza, Basheerbagh, Hyderabad-500063, Andhra Pradesh, India
Tel. No.:	91-40-23231740
Associates/Subsidiaries :	Pragati Pack (India) Private Limited (U74990AP2001PTC036608) Pragati Flexo Private Limited (U74990AP2001PTC036609)
Group Companies:	Pragati Offset Pragati Pack Pragati Flexo Marins Lamas

CAPITAL STRUCTURE

As on 29.09.2010

Authorised Capital :

No. of Shares	Type	Value	Amount
50000	Equity Shares	Rs.100/- each	Rs.5.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
41232	Equity Shares	Rs.100/- each	Rs.4.123 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		4.123	4.123	4.123
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		1046.283	936.353	836.129
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		1050.406	940.476	840.252
LOAN FUNDS
1] Secured Loans		22.867	0.000	0.000
2] Unsecured Loans		20.481	18.675	47.137
TOTAL BORROWING		43.348	18.675	47.137
DEFERRED TAX LIABILITIES		17.838	18.370	22.973
TOTAL		1111.592	977.521	910.362
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		337.728	285.062	272.703
Capital work-in-progress		67.269	12.730	0.232
INVESTMENT		104.065	73.720	57.270
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	143.416	154.747	97.762
	Sundry Debtors	170.689	142.931	216.957
	Cash & Bank Balances	120.665	128.044	154.969
	Other Current Assets	3.393	2.185	1.236
	Loans & Advances	335.855	335.652	262.700
Total Current Assets		774.018	763.559	733.624
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	24.852	17.457	34.792
	Other Current Liabilities	87.165	77.905	52.133
	Provisions	59.471	62.188	66.542
Total Current Liabilities		171.488	157.550	153.467
Net Current Assets		602.530	606.009	580.157
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		1111.592	977.521	910.362

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Turnover	854.568	780.471	882.198
Less	EXPENSES
		Office Expenses
		Administrative Expenses
		Advertising Expenses
		TOTAL	NA	NA	NA
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION		213.427	207.951	202.923
Less/ Add	DEPRECIATION/ AMORTISATION		51.951	53.979	60.783
	PROFIT BEFORE TAX		161.476	153.972	142.140
Less	TAX		51.546	53.749	49.788
	PROFIT AFTER TAX		109.930	100.223	92.352
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		636.698	576.475	524.123
Less	APPROPRIATIONS
		Transfer to General Reserve	40.000	40.000	40.000
	BALANCE CARRIED TO THE B/S		706.628	636.698	576.475
	EARNINGS IN FOREIGN CURRENCY		50.803	53.514	57.292
	IMPORTS
		Raw Materials	18.941	13.827	15.910
		Consumables Stores, Spares and Binding Material	0.355	6.614	15.951
		Capital Goods	55.535	5.841	6.952
		Royalty	2.288	0.191	0.734
		Traveling Expenses	1.154	0.849	4.591
	TOTAL IMPORTS		78.273	27.322	44.138
	Earnings Per Share (Rs.)		2666	2431	2239

Expected Sales (2010-2011) : Rs.950.000 Millions

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
Net Profit Margin (PBT/Sales)	(%)	18.90	19.73	16.11
Return on Total Assets (PBT/Total Assets}	(%)	14.52	14.68	14.12
Return on Investment (ROI) (PBT/Networth)		0.15	0.16	0.17
Debt Equity Ratio (Total Liability/Networth)		0.20	0.19	0.23
Current Ratio (Current Asset/Current Liability)		4.51	4.85	4.78

LOCAL AGENCY FURTHER INFORMATION

Details of Sundry Creditors:

Particulars	31.03.2010 (Rs. in millions)	31.03.2009 (Rs. in millions)	31.03.2008 (Rs. in millions)
Sundry Creditors	23.463	17.105	29.344
Creditors for Capital Goods	1.389	0.352	5.448
Total	24.852	17.457	34.792

Review of Operations:

The turnover of the company showed an increase of 9% over the previous year. They have not touched the highs of 2007-08 but nearly there. The global markets are still choppy. The domestic markets while being good, customers are holding back on spending and also cutting back on expenditures. This is affecting the business. Also the numbers of new printing companies are increasing at a much higher rate than the growth of print business. The same pie is being cut into smaller pieces.

Pragati has always been serving the high end printing needs of the customers. Luckily our major clients such as Asian Paints, ITC, Dr. Reddys’ have done well and that is reflecting in our books too.

The major outflows during the year have been for the infrastructure development at Balanagar and also at the head office. These will translate into more efficient operations in the coming years and will have a positive effect on the turnovers in the coming times.

Fixed Assets:

• Land
• Factory Building
• Other Buildings
• Plant And Machinery
• Furniture And Fixtures
• Vehicles
• Office Equipment
• Computers
• Electrical Equipments

Trade References:

• Inyosys Technologies Limited, Bangalore
• Dr. Reddy’s Laboratories Limited

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.45.74
UK Pound	1	Rs.72.73
Euro	1	Rs.62.73

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
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	6
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	NO
--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		51

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.