MIRA INFORM REPORT

Report Date :

16.03.2011

IDENTIFICATION DETAILS

Name :	MORARJEE TEXTILES LIMITED
Registered Office :	Peninsula Spenta, Mathuradas Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai – 400013, Maharashtra
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	14.07.1995
Com. Reg. No.:	11-90643
CIN No.: [Company Identification No.]	L52322MH1995PLC090643
TAN No.: [Tax Deduction & Collection Account No.]	MUMM09765A
Legal Form :	Public Limited Liability Company. The Company’s Shares are Listed on the Stock Exchange.
Line of Business :	Manufacturer of Cotton Woven Fabrics

RATING & COMMENTS

MIRA’s Rating :

B (26)

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

Maximum Credit Limit :	USD 2468300
Status :	Moderate
Payment Behaviour :	Slow
Litigation :	Clear
Comments :	Subject is an established company having moderate track. There appears some accumulated losses recorded by the company. However trade relations are reported as fair. Business is active. Payments are reported to be slow. The company can be considered fro business dealings with some caution.

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 :	Peninsula Spenta, Mathuradas Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai – 400013, Maharashtra
Tel. No.:	91-22-66154651/52/53
Fax No.:	91-22-66154593
E-Mail :	hvala@ashokpiramalgroup.com
Website :	www.morarjeetextiles.com
Factory 1 :	G – 2, MIDC Industrial Estate, Post Salaidhaba, Butibori, Nagpur – 441108, Maharashtra, India
Tel. No.:	91-7104-265704/708/514/519
Fax No.:	91-7104-265703/508
Overseas Sales Office :	Corso Italia, 62-20025 Legnano (Mi) – Italy
Tel. No.:	39-331-455028
Fax No.:	39-331-545026
E-Mail :	morarjee@morarjeeinternational.com
Processing Unit:	Plot No. 101/102, 19^th Street, MIDC Area, Satpur, Nashik 422007, Maharashtra, India
Email:	amtrac_nsk@sancharnet.in
Mumbai Liasioning Office :	104, Bayside Mall, 35, C.M.M. Malviya Marg, Tardeo Road, Haji Ali, Mumbai 400 034, Maharashtra, India

DIRECTORS

As on 31.03.2010

Name :	Ms. Urvi A Piramal
Designation :	Chairperson
Other Directorship held	Ashok Piramal Management Corporation Limited G. P. Electronics Limited Just Textiles Limited Peninsula Land Limited Peninsula Trustee Limited
Name :	Mr. Harshvardhan A Piramal
Designation :	Executive Vice Chairman
Other Directorship held	Ashok Piramal Management Corporation Limited Fabritex Exports Private Limited Integra Apparels & Textiles Private Limited Just Textiles Limited Peninsula Facility Management Services Private Limited Peninsula Mega Properties Private Limited Pranit Consultants Private Limited
Name :	Mr. Mahesh S Gupta
Designation :	Director
Date of Birth/Age:	30.06.1956
Date of Appointment :	19.01.2006
Qualification :	B.Com, Chartered Accoutant, Company Secretary and Law Graduate
Profile and Expertise	Mr. Gupta has over 3 decades of professional experience in business management and in all aspects of Corporate Finance such as treasury management, mergers and acquisitions, strategic planning, direct taxation, company law matters, etc. Mr Gupta was awarded the CFO of the Year Award (2001), Special Commendation for Financial Excellence (Mergers & Acquisitions Category) by IMA (formerly known as EIU), New Delhi. Shareholding in the Company Mr. Mahesh Gupta does not hold any equity shares of the Company. Directorship and committee memberships (excluding Morarjee Textiles Limited) Directorships Ashok Piramal Management Corporation Limited Arrow Webtex Limited Brabourne Enterprises Limited Ceat Limited City Parks Private Limited Champs Elysee Enterprises Private Limited Peninsula Land Limited Peninsula Investment Management Company Limited Peninsula Pharma Research Centre Private Limited RPG Life Sciences Limited Chairman of Board Committees RPG Life Sciences Limited - Investors Grievance Committee Brabourne Enterprises Limited – Investors Grievance Committee Member of Board Committees RPG Life Sciences Limited - Audit Committee Brabourne Enterprises Limited - Audit Committee Ceat Limited - Audit Committee Ceat Limited - Investors Grievance Committee Peninsula Investment Management Company Limited - Audit Committee
Name :	Mr. Pradipta Mohapatra
Designation :	Director
Other Directorship held	Spencer International Hotels Limited Saregama India Limited RPG Telephone Limited Basic Tele Services Limited Zensar Technologies Limited Brabourne Enterprises Limited Zensar OBT Technologies Limited Executive & Business Coaching Foundation India Limited
Name :	Mr. Aditya Mandaldas
Designation :	Director
Date of Birth/Age:	16.09.1963
Date of Appointment :	18.02.2005
Qualification :	Mechanical Engineer from L.D.College of Engineering, MBA from Babson College USA
Profile and Expertise:	Mr Aditya Mangaldas has professional expertise in finance and business strategy. He also has a wide experience in the Textile Industry. He has been the Chairman and Managing Director of The Victoria Mills Ltd. since October, 1999. Mr. Mangaldas is actively involved in organizations involved in housing and caring for children with serious chronic diseases. Shareholding in the Company. Mr. Aditya Mangaldas does not hold any equity shares of the Company. Directorship and committee memberships (excluding Morarjee Textiles Limited) Directorships The Victoria Mills Limited Arrow Webtex Limited Chairman of Board Committees Arrow Webtex Limited - Audit Committee
Name :	Mr. Ranjan Sanghi
Designation :	Director
Other Directorship held	Amzel Automotive Limited Bajaj Auto Finance Limited Borax Morarjee Limited HDFC Trustee Company Limited Kemp & Company Limited Bagalkot Cement & Industries Limited Suraj Sanghi Finance Limited
Name :	Mr. Shobhan Thakore
Designation :	Director
Other Directorship held	Alkyl Amines Chemicals Limited Bharat Forge Limited Cambridge Solutions Limited Camphor & Allied Products Limited Carraro PNH Components (India) Private Limited Uni Deritend Limited Uni Klinger Limited
Name	Mr. R.K. Rewari
Designation :	CEO and Executive Director

KEY EXECUTIVES

Name :	Mr. S C Kashimpuria
Designation :	Head Finance and Accounts and Company Secretary
Name :	Mr. Haresh Vala
Designation :	Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 01.10.2010

Names of Shareholders	No. of Shares	Percentage of Holding
A) Shareholding of Promoters and Promoters Group
Indian
Individuals / HUF	105529	0.29
Any others (Specify)	23102106	63.59
B) Public Shareholding
a) Mutual Finds/UTI	2711	0.01
b) Financial Institutions / Banks	3061	0.23
c) Insurances Companies	1938286	5.33
d) Foreign Institutional Investors	1135	0.00
2) Non Institutional
a) Bodies Corporate	2083415	4.58
b) Individuals
i) Individuals shareholders holding nominal share capital up to Rs. 0.100 Million	4701850	11.74
ii) Individuals shareholders holding nominal share capital in excess of Rs. 0.100 Million	4189389	13.64
Any Others (Specify)	204867	0.56
c) NRI’s	204867	0.57
Total Public Shareholding (B)	13124714	36.12
Grand Total	36332349	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer of Cotton Woven Fabrics

Products :

ITC CODE NO.	PRODUCT DESCRIPTIONS
520880	Cotton Woven Fabric

PRODUCTION STATUS AS ON 31.03.2010

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
Looms	Nos	---	248	---
Spindles	Nos.	---	31568	---
Commercial Production	Pcs.	--	2400000	---

GENERAL INFORMATION

Bankers :

• Allahabad Bank
• Export – Import Bank of India
• Axis Bank

Facilities :

Secured Loans	31.03.2010 Rs. In Millions	31.03.2009 Rs. In Millions
Term Loan from Bank (Secured by a pari passu charge on the movable assets including its moveable plant and machinery, spare, tools and accessories secured by a pari passu equitable mortgage on Company’s immovable properties at Butibori, Nagpur in respect of Rs. 5,59.412 millions) (Previous year Rs. 664.414 millions ) Secured by first and exclusive charge on the present and future movable and immovable fixed assets at Bangalore (Karnataka) of the Company in respect of Rs. 194.472 millions.	753.884	664.414
Term Loan from Financial Institution (Secured by way of Equitable Mortgage on Company’s Immovable Properties at Butibori, Nagpur and by a charge created on Company’s moveable assets including its moveable plant and machinery spares, tools and accessories both present and future, subject to prior charge of Company’s Bankers)	6.250	12.500
Cash Credit / Packing Credit from Banks (Secured by way of hypothecation of Current Assets of the Co. viz.,Raw Materials, Stock- In - Process, Finished Goods, consuambles store and spares , book debts and other moveable both present and future and secured by pari passu second charge created on Go's moveable assets including its moveable plant and machinery, spares, tools and accessories both present and future.	778.308	644.151
Total	1538.442	1321.065
Unsecured Loans
Bodies Corporate	944.768	773.713
Banks	--	10.694
Others	7.852	--
Total	952.620	784.407

Banking Relations :	---
Auditors :
Name :	Shah and Company Chartered Accountant
Joint Ventures:	Morarjee Castiglioni (I) Private Limited Just Textiles Limited
Associates/ :	Peninsula Land Limited Ashok Piramal Management Corporation Limited Morarjee Goculdas Spg. and Wvg. Company Private Limited (Formerly Morarjee Legler Private Limited.) Peninsula Facility Management Services Private Limited
Subsidiaries:	Morarjee International s.r.l. Integra Apparels and Textiles Private Limited( up to 31.12.2009) Mens Club s.p.a.

CAPITAL STRUCTURE

As on 31.03.2010

Authorised Capital :

No. of Shares	Type	Value	Amount
43000000	Equity Shares	Rs. 10/- each	Rs.430.000 Millions
1000000	5% Redeemable Cumulative Non Convertible Preferences Shares	Rs. 100/- each	Rs.100.000 Millions
	Total		Rs.530.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
36332349	Equity Shares	Rs. 10/- each	Rs.363.324 Millions
	1,81,62,886 Equity Shares of Rs. 10/- each fully paid issued to Existing shareholder on Rights basis (Does not include 6577 Equity Shares kept in abeyance)
1000000	5% Redeemable Cumulative Non Convertible Preferences Shares	Rs. 100/- each	Rs.100.000 Millions
	(Redeemable anytime between 15th November, 2014 and 15^thNovember, 2019 at the option of the Company)
	Total		Rs.463.324 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		463.324	281.695	281.695
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		416.376	335.380	395.873
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		879.700	617.075	677.568
LOAN FUNDS
1] Secured Loans		1538.442	1321.065	1384.145
2] Unsecured Loans		952.620	784.407	597.271
TOTAL BORROWING		2491.062	2105.472	1981.416
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		3370.762	2722.547	2658.984
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		2359.049	1482.347	1526.538
Capital work-in-progress		0.930	6.750	35.798
INVESTMENT		86.592	255.356	312.317
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	583.159	471.890	523.231
	Sundry Debtors	403.526	426.388	313.994
	Cash & Bank Balances	12.734	13.824	76.738
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	354.106	288.485	290.807
Total Current Assets		1353.525	1200.587	1204.770
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	553.362	373.031	279.761
	Current Liabilities	147.438	169.687	140.678
	Provisions	26.305	0.000	0.000
Total Current Liabilities		727.105	542.718	420.439
Net Current Assets		626.420	657.869	784.331
MISCELLANEOUS EXPENSES		297.771	320.225	0.000
TOTAL		3370.762	2722.547	2658.984

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Income	2546.742	2035.844	1712.934
		Other Income	0.085	0.371	0.100
		TOTAL (A)	2546.827	2036.215	1713.034
Less	EXPENSES
		Cost of Materials	930.477	600.124	668.933
		Manufacturing Expenses	845.916	723.383	641.668
		Salaries, Wages, Bonus, etc.		181.834	173.223
		Increase/(Decrease) in Finished Goods	(72.310)	42.371	(63.562)
		Administrative Expenses	305.718	319.389	284.459
		Other Expenses	220.712	178.683	(16.369)
		TOTAL (B)	2230.513	2045.784	1688.352
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		316.314	(9.569)	24.682
Less	FINANCIAL EXPENSES (D)		229.761	204.518	149.034
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		86.553	(214.087)	(124.352)
Less/ Add	DEPRECIATION/ AMORTISATION (F)		123.397	105.096	100.969
	Exceptional Items		--	58.725	0.000
	PROFIT BEFORE TAX (E-F) (G)		(36.844)	(377.908)	(225.321)
Less	TAX (H)		0.664	2.810	2.091
	PROFIT AFTER TAX (G-H) (I)		(37.508)	(380.718)	(227.412)
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		(470.867)	(90.149)	(90.149)
	BALANCE CARRIED TO THE B/S		(508.375)	(470.867)	(90.149)
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	1435.901	1249.546	1022.259
	IMPORTS
		Raw Materials	141.274	130.886	156.820
		Stores & Spares	43.470	0.000	0.000
		Capital Goods	5.267	10.936	6.160
		Others	0.000	25.348	18.480
	TOTAL IMPORTS		190.011	167.170	181.460
	Earnings Per Share (Rs.)		(1.67)	(18.04)	--

QUARTERLY / SUMMARISED RESULTS

PARTICULARS	30.06.2010	30.09.2010	31.12.2010
Type	1^st Quarter	2^nd Quarter	3^rd Quarter
Sales Turnover	837.100	903.400	677.300
Total Expenditure	758.500	776.400	576.700
PBIDT (Excl OI)	78.600	127.000	100.600
Other Income	29.200	14.500	0.000
Operating Profit	107.800	141.500	100.600
Interest	62.400	71.500	46.700
Exceptional Items	0.000	0.000	0.000
PBDT	45.400	70.000	53.900
Depreciation	34.500	46.000	28.400
Profit Before Tax	10.900	24.000	25.500
Tax	0.000	0.000	0.000
Reported PAT	10.900	24.000	25.500
Extraordinary Items	0.000	0.000	0.000
Prior Period Expenses	0.000	0.000	0.000
Other Adjustments	0.000	0.000	0.000
Net Profit	10.900	24.000	25.500

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	(1.47)	(18.69)	(13.27)
Net Profit Margin (PBT/Sales)	(%)	(1.44)	(18.56)	(13.15)
Return on Total Assets (PBT/Total Assets}	(%)	(0.99)	(14.08)	(8.25)
Return on Investment (ROI) (PBT/Networth)		0.04	(0.61)	(0.33)
Debt Equity Ratio (Total Liability/Networth)		3.65	4.29	3.54
Current Ratio (Current Asset/Current Liability)		1.86	2.21	2.86

LOCAL AGENCY FURTHER INFORMATION

Operations Highlights – Standalone

During the year, the total income increased 31.3% by Rs. 625.378 millions to Rs. 2619.222 millions from Rs. 1993.844 millions in the previous year. The year ended at a loss of Rs. 37.508 millions as against the loss of Rs. 380.718 millions in the previous year. There is a considerable reduction in the loss as compared to the previous year.

The financials of the Company for the year ended 31^st March, 2010 includes 3 months’ financials of Integra Apparels and Textiles Limited which has merged with the Company with effect from 1st January, 2010.

Awards

The Company has been awarded the prestigious Texprocil Silver Trophy for the second highest export of Fabrics – Category Bleached / Dyed / Yarn Dyed / Printed for the year 2009-2010.

Subsidiary Companies/ Consolidated Accounts

The Central Government has granted exemption under Section 212(8) of the Companies Act, 1956, from attaching to the Balance Sheet of the Company, the Accounts and other documents of its Subsidiary Companies. However, the Consolidated Financial Statements of the Company, which include the results of the said Subsidiary

Companies, are included in this Annual Report. Further, a statement containing the particulars prescribed under the terms of the said exemption for each of the Company’s subsidiaries being Morarjee International s.r.l. and Men’s Club s.p.a. are also enclosed. Copies of the audited annual accounts of the Company’s subsidiaries can also be sought by any investor of the Company or its subsidiaries on making a written request to the Company Secretary at the Registered Office of the Company in this regard. The annual accounts of the Subsidiary Companies are also available for inspection by any investor at the Company’s and / or the concerned subsidiaries’ registered office.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Indian Textiles: Holding steady

Indian textiles, and indeed the broader economy, faced one of its biggest challenges last year thanks to the continuing fallout of the global economic slowdown. However, despite the tough market conditions, India’s textile exports in 2009-10 increased by 1.9% as compared to the previous year.

Indian garment exports dropped by 2.6% to $10.64 billion in 2009-10, compared to $10.93 billion in the previous year. The last few months of 2009-10 saw a sharp increase in cotton and yarn prices, and this trend is only likely to intensify in the medium term.

Nevertheless, the future looks promising. The recent revival of demand in the EU and, particularly, the USA, holds promise for the India’s textile exports, which are forecast to grow up to $24 billion in 2010-11, up from an estimated $20 billion in the 2009-10. Apart from established markets, exporters are also actively evaluating new markets such as Africa and Latin America.

Morarjee Textiles: Recovery on track

Reacting swiftly to the slowdown, Morarjee Textiles has adopted a result-driven strategy. This has resulted in the

Company beating its previous year’s performance. The company registered growth, both in terms of turnover and increase in PBIDT.

On a consolidated basis, total revenue increased by 3.7% from Rs. 32780.000 millions to Rs. 3401.000 millions. The year ended with a loss of Rs. 67.700 millions as against a loss of Rs. 476.6 millions in 2008-09. On standalone basis, Morarjee Textiles Limited ended the year with a net loss of Rs. 37.500 millions as against a loss of Rs. 380.700 millions in 2008-09.

On standalone basis, Morarjee Textiles Limited ended the year with a net loss of Rs. 3.75 crores as against a loss of Rs. 38.07 crores in 2008-09. Total revenue increased by 31.3%, from Rs. 1994.000 millions to Rs. 2619.000 millions.

PBIDT stood at Rs. 316.000 millions as against Rs. 9.000 millions loss in 2008-09. There has been a significant improvement in the performance of the company. All our major export markets, such as the USA and Europe, registered a healthy increase in sales. They also entered several new markets such as Australia, Russia, Colombia and China for both the print and yarn dyed businesses.

On the other hand, focus on the domestic market has resulted in sales going up by 35% over the previous year. The company has particularly increased its focus on the Indian retail segment, where turnover grew by almost 48% over the previous year. The company also upgraded its product range by introducing a super premium shirting fabric collection.

Outlook:

During the economic recession of 2008-09, there was a significant shift of textile and garment manufacturing to newly emerging or low cost countries, such as Vietnam and Bangladesh. Both these countries have witnessed significant acceleration in their exports, with a CAGR of over 16% over the last five years.

However, with India’s strengths of an established cotton source and existing supply chain from spinning to garments, the outlook for the Indian textile and apparel industry remains cautiously optimistic.

UNAUDITED FINANCIAL RESULTS FOR THE NINE MONTH ENDED 31.12.2010

(Rs. In Millions)

Particulars	Quarter Ended	Nine Months Ended
Income from Operations	837.100	2557.500
Total Expenditure
Increase /Decrease in stock	(63.600)	(76.800)
Material Consumed	412.900	1112.800
Dues and Chemicals	52.900	168.300
Staff Cost	88.800	284.500
Power and Fuel	82.100	223.900
Depreciation	34.500	115.500
Forex Loss / Gain	(28.800)	(38.100)
Other expenditure	185.400	533.200
Total Expenditure	764.200	2323.200
Profit before other income, Interest	72.900	234.200
Other Income	0.400	0.400
Profit before Interest	73.300	234.600
Interest	62.400	193.600
Profit after interest but before Exceptional item and Taxation	10.900	41.000
Exceptional Item	--	--
Profit / Loss after exceptional item but before Tax	10.900	41.000
Provision for Taxation	--	--
Net Profit / (Loss) before Minority Interest	10.900	41.000
Shares of Minority Interest	--	--
Total Profit / (Loss) after Minority Interest	--	--
Paid-up Equity Share Capital (face value of equity shares Rs. 10/- each )	3633	3633
Reserves excluding revaluation reserves	--	--
Basic and diluted EPS	0.23	0.97
Aggregate of Public Shareholding
Number of shares	13124714	13124714
Percentage of share holding	36.12%	36.12%
Promoters and Promoters Group
Pledged / Encumbered
Number of Shares	Nil	Nil
Percentage of Shares (as a % of total shareholding of promoter and promoter group)	Nil	Nil
Percentage of Shares (as a % of total share capital)	Nil	Nil
Non – Encumbered
Number of Shares	23207635	23207635
Percentage of Shares (as a % of total shareholding of promoter and promoter group)	100.00%	100.00%
Percentage of Shares (as a % of total share capital)	63.88%	63.88%

Note :

1. The above results have been reviewed by the audit committee and approved by the Board of Directors respectively at there meeting held on 17^th January, 2011
2. The company has only one reportable segment – Textile Product.
3. The Hon,ble High Court of Karnataka at Bangalore vide its order dated 27'Auguest sanctioned the scheme of Amalgamation of Integra Apparels and textile limited (integra a 100% subsidiary of the Company engaged in the business of manufacturing of garments with the Company. The appointment date of Scheme of Amalgamation was 1 Jan 2101 ' Accordingly the result for the quarter and Nine month ended 31December 2010 includes the financial of Integra are not comparable with figures of the previous period
4. The Company has filed a petition with the Hon’ble Bombay High Court under section 100-103 read with section 78 of the companies Act 1956 for setting off the debit balance of the Profit and Loss Account to the extent and against the balance lying to the credit of securities Premium Account Pending the approval of the petition by Hon’ble Bombay High Court, no Impact has been considered in the Results of the company.
5. The two complaints received during the quarter have been resolved. No. Complaints is lying unresolved at end of the quarter
6. Corresponding figures of the previous period / year have been regrouped wherever necessary.

Fixed Assets :

• Land - Leasehold
• Building
• Plant & Machinery
• Computer
• Furniture, Fixture
• Office Equipments
• Motor Vehicles
• Designs & Archives
• Computer Software

Website Details:

Profile:

Subject is a successful member of the diversified Ashok Piramal Group (APG). Carrying forward the legacy of the erstwhile Morarjee Goculdas Spinning and Weaving Company Limited since 1871, MTL is among the oldest textile units in the country and was the Ashok Piramal Group's first industrial enterprise when they took over in 1934.

Subject is a leading player in the premium shirting fabric business and high fashion printed fabric business for global markets. It has completely integrated manufacturing plants with spinning, weaving, printing, processing and packing facilities. Its products are in the high value niche segment. MTL has two divisions - the shirting division and the printed fabric division.

Subject’s competitive advantage lies in its innovative design, product development and flexible service offering. It makes premium voiles and high fashion printed fabrics for the Middle East, Far East, North African and European markets.

Its customer base is spread across 20 countries around the globe and is growing fast. Today it offers premium cotton shirting fabrics to most of the leading Indian and International brands. MTL also has a 49% stake in Just Textiles Limited which is currently engaged in the business of processing various textile fabrics with modern machinery installed at its factory in Ambernath, Mumbai. To ensure growth and provide value to its stakeholders, MTL has recently entered the garments business in mid 2004 by establishing a subsidiary company - Integra Apparels and Textiles Private Limited The business already has an impressive client list and is growing rapidly.

Men's Club s.p.a. a premium men’s shirting brand is the Group's latest acquisition.

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. 45.27
UK Pound	1	Rs. 72.94
Euro	1	Rs.63.08

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	3
OPERATING SCALE	1~10	3
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	2
--PROFITABILIRY	1~10	2
--LIQUIDITY	1~10	3
--LEVERAGE	1~10	3
--RESERVES	1~10	2
--CREDIT LINES	1~10	3
--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	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		26

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.