MIRA INFORM REPORT

Report Date :

02.06.2011

NOTE: The correct name of the company is Otsuka Chemical (India) Private Limited

IDENTIFICATION DETAILS

Name :	OTSUKA CHEMICAL (INDIA) PRIVATE LIMITED (w.e.f. 11.03.2010)
Formerly Known As :	OTSUKA CHEMICAL (INDIA) LIMITED
Registered Office :	861-862, Joshi Road, Karol Bagh, New Delhi – 110005
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	02.01.2006
Com. Reg. No.:	55-144368
Capital Investment / Paid-up Capital :	Rs.256.016 Millions
CIN No.: [Company Identification No.]	U24239DL2006PTC144368
TAN No.: [Tax Deduction & Collection Account No.]	DEL002697C
Legal Form :	Private Limited Liability Company.
Line of Business :	Manufacturer and Distributor of Chemicals, Chemical Intermediates and Bulk Drugs.
No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

B (28)

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Maximum Credit Limit :	USD 3600000
Status :	Moderate
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is a subsidiary of Otsuka, Japan and a part of Otsuka Group. It is an established company having moderate 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 for business dealings with some cautions.

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 :	861-862, Joshi Road, Karol Bagh, New Delhi – 110005, India
Tel. No.:	91-124-4597980/ 4597979
Fax No.:	91-124-4597980
E-Mail :	accounts@otsukaindia.com secretarial@otsuikaindia.com
Website :	http://www.chemical.otsukac.co.jp http://www.otsukaindia.com
Head Office :	416, JMD Pacific Square, Sector 15, Part II, Near 32nd Mile Stone, Gurgaon, Haryana, India
Tel No.:	91-124-4597979
Fax No.:	91-124-4597980
Email :	info@otsukaindia.com
Factory:	SP-3, 10 And 11, RIICO Industrial Area, Keshwana Rajpoot, Jaipur – 303108, Rajasthan, India

DIRECTORS

(AS ON 26.07.2010)

Name :	Mr. Hiroyoshi Tosa
Designation :	Chairman cum Managing Director
Address :	6/11, 1^st Floor, Shanti Niketan, New Delhi-110021, India
Date of Birth/Age :	16.06.1966
Date of Appointment :	30.06.2007
DIN No.:	00264234
Name :	Mr. Ichiro Kawahara
Designation :	Whole Time Director
Address :	18-5, Itano-Gun, Aizumicyo, Yagsmaza, Ksugs, Tokudhims-7711252
Date of Birth/Age :	27.01.1954
Date of Appointment :	15.01.2007
Name :	Mr. Manish Dhanuka
Designation :	Director
Address :	Cottage No. 4, 31B, Rajpur Road, Civil Lines, Delhi-110054, India
Date of Birth/Age :	28.09.1967
Date of Appointment :	02.01.2006
DIN No.:	00238798
Name :	Mr. Mridul Dhanuka
Designation :	Director
Address :	Plot No. 95 B, E-2 Lane, Eastern Avenue, Sainik Farms, New Delhi-110062, India
Date of Birth/Age :	27.10.1980
Date of Appointment :	02.04.2006
DIN No.:	00199441
Name :	Mr. Arun Malhotra
Designation :	Director
Address :	43, Deshbandhu Appartment, Kalkaji, New Delhi – 110019, India
Date of Birth/Age :	14.06.1960
Date of Appointment :	26.07.2010
DIN No.:	03147644
Name :	Mr. Ryo Kikuchi
Designation :	Director
Address :	Flat No.21, X Block, Regency Park II, DLF City, Phase IV, Gurgaon – 122001, Haryana, India
Date of Appointment :	30.09.2009
DIN No.:	02780746
Name :	Mr. Yutaka Kameyama
Designation :	Additional Director
Address :	Tsurajima – Chuo, 2-4-29, Kurashiki – City, Okayama Pref 7128012, Japan
Date of Birth/Age :	03.02.1961
Date of Appointment :	26.07.2010
DIN No.:	03166619

KEY EXECUTIVES

Name :	Mr. Sudhanshu Shekhar Thakur
Designation :	Secretary
Address :	Gali No. 7, Patel Nagar, Near Choti Hanuman Mandir, Gugaon-122001, Haryana, India
Date of Birth/Age :	26.11.1975
Date of Appointment :	02.06.2008
PAN No.:	AFTPT3667E

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

(AS ON 26.07.2010)

Names of Shareholders	No. of Shares
Manish Dhanuka	50000
Mridul Dhanuka	50000
Dhanuika Laboratories Limited, India	1927248
Otsuka Chemical Company Limited, Japan	23566329
Yo Ichi Nishioka	2000
Ichiro Kawahara	2000
Hiroyoshi Tosa	2000
Keisuke Yasue	2000
Total	25601577

(AS ON 10.03.2011)

Names of Allottees	No. of Shares Allotted
Otsuka Chemical Company Limited, Japan	5454545
Total	5454545

(AS ON 30.09.2010)

Category	Percentage
Foreign holdings (Foreign institutional investor(s), Foreign companies(s) Foreign financial institution(s), Non-resident Indian(s) or Overseas corporate bodies or others)	92.05
Bodies corporate (not mentioned above)	7.53
Directors or relatives of directors	0.40
Others	0.02
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer and Distributor of Chemicals, Chemical Intermediates and Bulk drugs

Products :

Product Description	ITC Code
Intermediate Bulk Drug	30042019

· Advanced Material Products

· Hydrazine Derivatives Products

· Hydrazine Related Products

· Fine Intermediate Products

· Inorganic Products

GENERAL INFORMATION

No. of Employees :

Not Available

Bankers :

· Bank of Tokoyo

· ECB Miziho Bank

Facilities :

Secured Loans	31.03.2010	31.03.2009
	(Rs. In Millions)
Term Loans From Banks
Loans in Foreign Currency*	828.324	1016.652
Working Capital Loans from Banks
Loans in INR*	100.070	204.000
Total	928.394	1220.652

NOTE:

These Loans are Secured against letter of Guarantee of Otsuka chemicals company Limited, Japan.

Banking Relations :	--
Auditors :
Name :	Dinesh Mehta and Company Chartered Accountant
Address :	21, Dayanand Marg, Darya Ganj, New Delhi-110002, India
Tel. No.:	91-11-23272623/ 23272168
Fax No.:	91-11-23286562
E-Mail :	anupamehta@dmc.ca.net dmc@dmc.ca.net
Holding Company :	Otsuka Chemical Company Limited
Group Companies (As on 31.03.2008) :	· Otsuka Pharmaceutical Company Limited · Otsuka Pharmaceutical Factory, Inc. · Taiho Pharmaceutical Company Limited · Otsuka Warehouse Company Limited · Earth Chemical Company, Limited · Otsuka Beverage Company Limited · Japan Immunoresearch Laboratories Company Limited · Otsuka Electronics Company Limited · Otsuka Ohmi Ceramics Company Limited · Otsuka Packing Industries Company Limited · Otsuka Techno Corporation · Okayama Taiho Pharmaceutical Company Limited · Earth Environmental Service Company Limited · Earth Biochemical Company Limited · Kitasato Otsuka Biomedical Assay Laboratories Company Limited · EN Otsuka Pharmaceutical Company Limited · The Otsuka Museum of Art.

CAPITAL STRUCTURE

(AS ON 26.07.2010)

Authorised Capital : Rs.320.000 Millions

Issued, Subscribed & Paid-up Capital : Rs.310.561 Millions

(AS ON 31.03.2010)

Authorised Capital :

No. of Shares	Type	Value	Amount
26500000	Equity Shares	Rs.10/- each	Rs.265.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
25601577	Equity Shares	Rs.10/- each	Rs.256.016 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		256.016	202.725	105.353
2] Share Application Money		0.000	0.000	511.993
3] Reserves & Surplus		645.516	325.947	394.118
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		901.532	528.672	1011.464
LOAN FUNDS
1] Secured Loans		928.394	1220.652	640.800
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		928.394	1220.652	640.800
DEFERRED TAX LIABILITIES		0.000	0.000	1.884
TOTAL		1829.926	1749.324	1654.148
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		1279.245	1401.892	1455.050
Capital work-in-progress		0.000	0.000	35.961
INVESTMENT		0.000	0.000	0.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	184.744	106.293	19.563
	Sundry Debtors	331.517	171.926	0.764
	Cash & Bank Balances	2.662	16.754	76.183
	Other Current Assets	10.329	6.461	0.208
	Loans & Advances	189.072	179.957	161.997
Total Current Assets		718.324	481.391	258.715
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditor	139.033	113.551	34.001
	Other Current Liabilities	26.024	16.387	57.852
	Provisions	3.099	4.329	3.789
Total Current Liabilities		168.156	134.267	95.642
Net Current Assets		550.168	347.123	163.073
MISCELLANEOUS EXPENSES		0.513	0.309	0.064
TOTAL		1829.926	1749.324	1654.148

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Income		284.119	0.648
		Other Income		3.493	11.653
		TOTAL (A)		287.612	12.301
Less	EXPENSES
		Increase/(Decrease) in Finished Goods/ Work in Process		(64.251)	(0.062)
		Raw Material Consumed	NA	278.993	3.922
		Manufacturing Expenses		102.624	0.488
		Personnel Expenses		49.988	1.162
		Selling, General and Administrative Expenses		11.823	0.404
		Foreign Exchange Fluctuation Loss/ (Gain)		187.126	(7.360)
		TOTAL (B)		566.303	(1.446)
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		285.210	(278.691)	13.747
Less	FINANCIAL EXPENSES (D)		19.508	32.345	0.223
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		265.702	(311.036)	13.524
Less/ Add	DEPRECIATION/ AMORTISATION (F)		185.953	196.943	5.033
	PROFIT BEFORE TAX (E-F) (G)		79.749	(507.979)	8.491
Less	TAX (H)		(0.011)	(1.633)	3.632
	PROFIT AFTER TAX (G-H) (I)		79.760	(506.346)	4.859
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		NA	10.027	5.168
	BALANCE CARRIED TO THE B/S		NA	(496.319)	10.027
	Earnings Per Share (Rs.)		3.12	(29.39)	0.46

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	NA	(176.05)	39.50
Net Profit Margin (PBT/Sales)	(%)	NA	(178.79)	1310.34
Return on Total Assets (PBT/Total Assets}	(%)	3.99	(26.97)	0.50
Return on Investment (ROI) (PBT/Networth)		0.09	(0.96)	0.01
Debt Equity Ratio (Total Liability/Networth)		1.22	2.56	0.73
Current Ratio (Current Asset/Current Liability)		4.27	3.59	2.71

LOCAL AGENCY FURTHER INFORMATION

FIXED ASSETS:

· Land

· Building

· Plant and Machinery, Electrical

· Furniture and Fixture

· Computer

· Vehicles

· Software

AS PER WEBSITE

PROFILE:

Subject was incorporated in 2006 with an object to produce Advance Cephalosporin Drug Intermediate namely “GCLE”. Since Indian Pharmaceutical Industry is the largest consumer of GCLE across the world, and they wanted to be close to the customers, Otsuka decided to set up GCLE manufacturing facility in India.

With the above aim, the company set up a fully automatic DCS controlled plant at Kotputli, in Rajasthan, India. The plant has come into full operations since May 2008.

GCLE is a major raw material to produce some vital Cephalopodan antibiotics such as, Cefixime, Cefdinir, Cefprozil and Cefpodoxime, They are well supported by world class research facilities and having world class manufacturing facility in India. The focus is to provide the best services to our customers, vendors and associate partners. Company is committed to energy conservation, environment and water resources.

COMPANY PROFILE:

The Otsuka Pharmaceutical Group originated in 1921, with the establishment of Otsuka Pharmaceutical Factory. In the early days, the company was engaged in the manufacture and sale of industrial and pharmaceutical chemicals, and entered into intravenous solutions business in 1946.

In 2008 Otsuka Holdings took over all Otsuka subsidiary companies under it’s control. Today there are 153 companies under the banner of Otsuka Holdings. The “Otsuka Chemical India Limited” is one of the group company of Otsuka Holdings.

The first step towards development of this Key technology for the manufacture of GCLE was laid between 1980 to 1982. They started with electrochemical en e-type chlorination of the N-substitute (3-methyl-3-butenoate) of the azetidinones, followed by construction of the cephem framework by ammonia-promoted recyclization. The phenylsulfonyl moiety worked effectively for trapping the in situ generated sufenic acid in the first step, as a protecting group in the en e-type chlorination, and as a good leaving group in the final recyclization step.

They continued our efforts and made improvements in each of the sequential processes up to a level, feasible for industrial production of GCLE

In 1984 we constructed lab scale plant in Japan and started production GCLH and GCLE. In 1988, we succeeded in producing 18mt GCLE in a year. They decided to produce GCLE as their original product and established first commercial plant in 1990 with an installed capacity of 150 mt / year.

The Japanese plant is producing more than 220 mt GCLE / year. The efforts to improve GCLE manufacturing technology is continuing even today. Over a period of years, their customer base has also expanded not only in Japan but also in Italy, USA, China, Korea and India.

They have decided to establish a second plant, the first in India, in 2006. This State of the art, fully automatic plant started producing GCLE in 2008, and today Otsuka Chemical group is the largest producer of GCLE in the world.

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.44.89
UK Pound	1	Rs.73.85
Euro	1	Rs.64.76

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	3
PAID-UP CAPITAL	1~10	4
OPERATING SCALE	1~10	3
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	3
--PROFITABILIRY	1~10	4
--LIQUIDITY	1~10	3
--LEVERAGE	1~10	3
--RESERVES	1~10	3
--CREDIT LINES	1~10	2
--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	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		28

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.