MIRA INFORM REPORT

Report Date :

25.07.2011

IDENTIFICATION DETAILS

Name :	ESMECH EQUIPMENT PRIVATE LIMITED
Registered Office :	A-4, A-6, Gundecha Onclave, Kherani Road, Andheri (East), Mumbai - 400 072, Maharashtra
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	04.03.2008
Com. Reg. No.:	11-179671
Capital Investment / Paid-up Capital :	Rs.50.000 Millions
CIN No.: [Company Identification No.]	U29255MH2008PTC179671
TAN No.: [Tax Deduction & Collection Account No.]	MUME07800C
PAN No.: [Permanent Account No.]	AABCE9492J
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacturer of World Class Cold Rolling Mills and Strip Metal Process Line Equipments.
No. of Employees :	400 (Approximately)

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 2364000
Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject is a Joint Venture between SMS Siemay AG, Germany and HB Esmech Private Limited engaged in manufacturing of world class cold rolling mills and strip metal process line equipment. It is an established company having satisfactory track. Trade relations are fair. Business is active. Payments are reported to be usually correct and as per commitments. The company can be considered 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.

INFORMATION PARTED BY

Name :	Mr. Pramod
Designation :	Finance Controller
Date :	23.07.2011

LOCATIONS

Registered Office :	A-4, A-6, Gundecha Onclave, Kherani Road, Andheri (East), Mumbai - 400 072, Maharashtra , India
Tel. No.:	91-22-25821295
Fax No.:	91-22-25826560
E-Mail :	vjoshi@esmech.com esmech@esmech.com
Website :	http://www.esmech.com
Factory 1 :	Plot Nos.A-254-259 and A283, Road No.30A, Wagle Industrial Estate, Thane (West) – 400 604, Maharashtra, India
Tel. No.:	91-22-25821295, 25821733, 25823417
Fax No.:	91-22-25826550
Factory 2 :	Also Located at: v Wada

DIRECTORS

As on 30.09.2010

Name :	Mr. Suresh Laxman Joshi
Designation :	Chairman
Address :	Pitruvandana, Plot No.11, Kala Nagar, Bandra (East), Mumbai – 400 051, Maharashtra, India
Date of Birth/Age :	24.12.1940
Qualification :	B.E. (Mechanical)
Date of Appointment :	04.03.2008
DIN No.:	01934030
Name :	Mr. Vijay Suresh Joshi
Designation :	Managing Director
Address :	Pitruvandana, Plot No.11, Kala Nagar, Bandra (East), Mumbai – 400 051, Maharashtra, India
Date of Birth/Age :	08.03.1969
Qualification :	B.E. (Mechanical), PGDM (IIM Ahmadabad)
Date of Appointment :	04.03.2008
DIN No.:	01550964
Name :	Mr. Peter Joachim Piepers
Designation :	Director
Address :	10, Feldstrasse, Scheuerfeld-57584, Germany
Date of Birth/Age :	12.07.1953
Date of Appointment :	30.09.2010
DIN No.:	03025580
Name :	Mr. Ruediger Gerhard Holz
Designation :	Director
Address :	10, Tannenstrasse, Struthuetten, Neunkirchen-57290, Germany
Date of Birth/Age :	25.01.1960
Date of Appointment :	30.09.2010
DIN No.:	03025657
Name :	Mr. Franz Olaf Stalfort
Designation :	Director
Address :	111, Broicherdorfstrasse, Kaarst-41564, Germany
Date of Birth/Age :	18.07.1966
Date of Appointment :	30.09.2010
DIN No.:	03025762

KEY EXECUTIVES

Name :	Mr. Pramod
Designation :	Finance Controller

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 30.09.2010

Names of Shareholders	No. of Shares
Suresh Laxman Joshi	250000
Vijay Suresh Joshi	250000
HB Esmech Private Limited, India	1950000
SMS Siemag, Germany	2550000
Total	5000000

As on 30.09.2010

Equity Share Breakup	Percentage of Holding
Category
Foreign holdings [Foreign institutional investors, Foreign Companies, Foreign Financial Institutions, Non-resident Indian or Overseas corporate bodies or others]	51.00
Bodies corporate	39.00
Directors or relatives of directors	10.00
Total	100.00

BUSINESS DETAILS

Line of Business :	Manufacturer of World Class Cold Rolling Mills and Strip Metal Process Line Equipments.
Products :	v Coil Processing Lines v Cold Rolling Mills / Skin Pass Mills v Pickling Lines v Cut-to-Length Lines v Slitting Lines v Tension Levelling Lines v Coating Lines v Rewinding and Trimming Lines v Blanking Line v Electrolytic Cleaning Line v Special Purpose Lines
Terms :
Selling :	Cash and Credit (30/ 60 days)
Purchasing :	Cash and Credit (30/ 60 days)

PRODUCTION STATUS (AS ON 31.03.2010)

Particulars	Licensed Capacity	Installed Capacity *	Actual Production *
Coil Processing equipments and spares	Not applicable	--	--

* Note: The Company manufactures custom designed coil processing equipment and spares thereof, hence the concept of "Installed Capacity" and "Actual Production" is difficult to quantify.

This being technical matter, is as certified by the Management and relied upon by Auditors.

GENERAL INFORMATION

Customers :

Manufacturer

No. of Employees :

400 (Approximately)

Bankers :

Canara Bank, Bhandup Branch

Facilities :

Secured Loan	As on 31.03.2010 (Rs. in Millions)	As on 31.03.2009 (Rs. in Millions)
Can Mobile	0.653	0.000
TML Financial Services Limited (The above loans are secured by hypothecation of vehicles)	0.392	0.000
Total	1.045	0.000
Unsecured Loan
From Directors [Repayable within one year Rs.0.027 millions (previous year Rs. Nil)]	0.027	0.027
Total	0.027	0.027

Banking Relations :	--
Auditors :
Name :	Haribhakti and Company Chartered Accountants
Address :	42, Free Press House, 4^th Floor, 125, Nariman Point, Mumbai – 400 021, Maharashtra, India
Tel. No.:	91-22-61326999
Fax No.:	91-22-22856237
Website :	www.bdoindia.co.in
Income-tax PAN of auditor or auditor's firm :	AAAFH2010F
Holding Company :	SMS Siemag AG (SMS) Address: Eduard-Schloeman-Strabe 4, D-40237, Dusseldoorf, Germany
Subsidiary Company :	Pitel Engineering Private Limited (PEPL)
Enterprises over which Key Management Personnel and Relatives of such personnel exercise significant influence :	v Esmech Rolling Machinery Private Limited (ERMPL) v HB Esmech Private Limited (HBEPL) v Kennovation Software Services Private Limited (KSSPL) v Retailnet India Private Limited (RIPL)

CAPITAL STRUCTURE

As on 31.03.2010

Authorised Capital :

No. of Shares	Type	Value	Amount
5000000	Equity Shares	Rs.10/- each	Rs.50.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
5000000	Equity Shares	Rs.10/- each	Rs.50.000 Millions

(Of the above shares 2550000 held by SMS Siemag AG, Germany)

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2010	31.03.2009
SHAREHOLDERS FUNDS
1] Share Capital		50.000	0.100
2] Share Application Money		0.000	0.000
3] Reserves & Surplus		541.001	0.000
4] (Accumulated Losses)		0.000	(0.021)
NETWORTH		591.001	0.079
LOAN FUNDS
1] Secured Loans		1.045	0.000
2] Unsecured Loans		0.027	0.027
TOTAL BORROWING		1.072	0.027
DEFERRED TAX LIABILITIES		0.933	0.000
TOTAL		593.006	0.106
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		199.176	0.000
Capital work-in-progress		31.409	0.000
INVESTMENT		5.865	0.000
DEFERREX TAX ASSETS		0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	224.503	0.000
	Sundry Debtors	396.907	0.000
	Cash & Bank Balances	51.776	0.058
	Other Current Assets	0.000	0.000
	Loans & Advances	58.965	0.025
Total Current Assets		732.151	0.083
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	203.755	0.007
	Other Current Liabilities	143.019	0.000
	Provisions	28.821	0.000
Total Current Liabilities		375.595	0.007
Net Current Assets		356.556	0.076
MISCELLANEOUS EXPENSES		0.000	0.030
TOTAL		593.006	0.106

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009
	SALES
		Income	389.765	0.000
		Other Income
		TOTAL	389.765	0.000
Less	EXPENSES
		Office Expenses	262.057	0.021
		Administrative Expenses
		Advertising Expenses
		TOTAL	262.057	0.021
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION		127.708	(0.021)
Less/ Add	DEPRECIATION/ AMORTISATION		5.377	0.000
	PROFIT BEFORE TAX		122.331	(0.021)
Less	TAX		43.957	0.000
	PROFIT AFTER TAX		78.374	(0.021)
Less	LOSS OF EARLIER YEARS		0.021	0.000
	BALANCE CARRIED TO THE B/S		78.353	(0.021)
	EARNINGS IN FOREIGN CURRENCY
		Value of Exports	117.528	0.000
	TOTAL EARNINGS		117.528	0.000
	IMPORTS
		Raw Material	16.271	0.000
	TOTAL IMPORTS		16.271	0.000
	Earnings Per Share (Rs.)		617.85	(0.21)

Particulars	31.03.2011 (Approximately)
Sales Turnover	1070.000

The above information has been parted by Mr. Pramod (Finance Controller).

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009
PAT / Total Income	(%)	20.11	(0.00)
Return on Total Assets (PBT/Total Assets}	(%)	13.13	(25.30)
Return on Investment (ROI) (PBT/Networth)		0.21	(0.26)
Debt Equity Ratio (Total Liability/Networth)		0.64	0.42
Current Ratio (Current Asset/Current Liability)		1.95	11.86

LOCAL AGENCY FURTHER INFORMATION

Details of Sundry Creditors:

Particulars	31.03.2010 (Rs. in millions)	31.03.2009 (Rs. in millions)
Sundry Creditors:
- Dues to Micro, Small and Medium Enterprises	--	--
- Dues to Other than Micro, Small and Medium Enterprises	203.755	0.007

Note:

The registered office of the company has been shifted from A254-259 and A 283, Road No.30A, Wagle Industrial Estate, Thane – 400 604, Maharashtra, India to the present address w.e.f. 05.03.2008.

FORMATION OF JOINT VENTURES:

Under a joint venture agreement reached between the company, the company the promoter directors of the company and SMS Siemag AG (Germany), the business of HB Esmech Private Limited has been transferred as a going concern (with the exception of certain assets) to the company w.e.f. 07.01.2010. Prior to this date the company has not undertaken any sale or purchase transaction during the year.

NATURE OF BUSINESS:

The Company is the strip metal process line equipment, Cold Rolling Mills and Skin Pass Mills manufacturer and manufacturing a wide range of products including Acid Pickling Lines, Slitting Lines, Cut-to-Length Lines, Galvanising Lines, Colour Coating Lines, Tension Levelling Lines, In-line Skin Pass Mills Recoiling Lines, Degreasing Lines and a number of other special purpose lines.

ACQUISITION OF THE RUNNING BUSINESS OF HB ESMECH PRIVATE LIMITED AS A GOING CONCERN ON 07 JANUARY 2010:

The company has acquired the running business of HB Esmech Private Limited on a going concern basis by virtue of a slump sale as per the terms and conditions of the Indenture of Business Transfer executed between the company and HB Esmech Private Limited on 7.1.2010. All the necessary approvals statutory and government authorities have obtained.

The Esmech Equipment Private Limited does not carry any business prior to the acquisition of business of HB Esmech Private Limited. The financial statements for the year therefore pertain primarily to the period of 07 January 2010 to 31 March 2010.

CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF: (AS ON 31.03.2010)

v Bank Guarantees Rs.3.610 millions.

v Letter of Credit provided to customers Rs.10.457 millions.

FIXED ASSETS:

Tangible Assets:

v Plant and Machinery

v Furniture, Fixture and Fittings

v Electrical Installation

v Vehicles

v Office Equipments

v Computer

v Air Conditioner

v Factory Building

v Factor Shed

v Land

Intangible Assets:

v Goodwill

v Software

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.44.37
UK Pound	1	Rs.72.34
Euro	1	Rs.63.87

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.