1. Summary Information

		Country	India
Company Name	KURLON LIMITED	Principal Name 1	Mrs. Jaya S. Pai
Status	Good	Principal Name 2	Mr. Nitin Gajanan Rao Khot
		Registration #	08-001443
Street Address	N-301, IIIrd Floor, North Block, Front Wing, Manipal Centre, 47, Dickenson Road, Bangalore – 560042, Karnataka, India
Established Date	09.02.1962	SIC Code	--
Telephone#	91-80-25595367/25597168/25597262	Business Style 1	Manufacturer
Fax #	91-80-25587189	Business Style 2	Importer
Homepage	www.kurlon.com	Product Name 1	Rubberised Coir
# of employees	120 (Approximately)	Product Name 2	--
Paid up capital	Rs. 148728700/-	Product Name 3	--
Shareholders	Directors or relatives of directors - 1.56% Bodies Corporate - 92.50% Other top Fifty (50) Shareholders 3.89% Others - 2.05%	Banking	State Bank of India
Public Limited Corp.	NO	Business Period	48 Years
IPO	NO	International Ins.	--
Public Enterprise	NO	Rating	A (66)
Related Company
Relation	Country	Company Name	CEO
Subsidiaries	India	Kurlon Cesare Furniture Private Limited	--
Note	-

2. Summary Financial Statement

Balance Sheet as of	31.03.2010		(Unit: Indian Rs.)
Assets		Liabilities
Current Assets	1,277,984,000	Current Liabilities	1,056,080,000
Inventories	437,174,000	Long-term Liabilities	475,568,000
Fixed Assets	663,765,000	Other Liabilities	36,956,000
Deferred Assets	000	Total Liabilities	1,571,604,000
Invest& other Assets	28,764,000	Retained Earnings	526,945,000
		Net Worth	837,576,000
Total Assets	2,407,687,000	Total Liab. & Equity	2,407,119,000
Total Assets (Previous Year)	1,998,119,000
P/L Statement as of	31.03.2010		(Unit: Indian Rs.)
Sales	4,088,133,000	Net Profit	210,710,000
Sales(Previous yr)	3,672,506,000	Net Profit(Prev.yr)	142,735,000

MIRA INFORM REPORT

Report Date :

06.11.2011

IDENTIFICATION DETAILS

Name :	KURLON LIMITED
Registered Office :	N-301, IIIrd Floor, North Block, Front Wing, Manipal Centre, 47, Dickenson Road, Bangalore – 560042, Karnataka
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	09.02.1962
Com. Reg. No.:	08-001443
Capital Investment / Paid-up Capital :	Rs.148.729 millions
CIN No.: [Company Identification No.]	U17214KA1962PLC001443
Legal Form :	A Closely held Public Limited Liability Company.
Line of Business :	Manufacturer, Importer and Exporter of Rubberised Coir products (such as mattresses, beds, pillows etc.), plain/curled coir products (such as mats and spreads etc.) and polyurethan foam
No. of Employees :	120 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

A (66)

RATING		STATUS	PROPOSED CREDIT LINE
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

Maximum Credit Limit :	USD 2900000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established and reputed company having satisfactory track. ‘Kurl-on’ brand enjoys very favorable reputation in the industry. Financial position of the company is satisfactory. Payments are usually correct and as per commitments. The company 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 – September 30, 2011

Country Name	Previous Rating (30.06.2011)	Current Rating (30.09.2011)
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 :	N-301, IIIrd Floor, North Block, Front Wing, Manipal Centre, 47, Dickenson Road, Bangalore – 560042, Karnataka, India
Tel. No.:	91-80-25595367/25597168/25597262
Fax No.:	91-80-25587189
E-Mail :	md@kurlon.org
Website :	www.kurlon.com
Area :	5000 Sq. ft.
Location :	Leased
Zonal Office :	Located at Kolkata, Chennai, New Delhi, Kanpur and Mumbai.
Factories :	Factory-1: Jalahalli, Camp Road, Yeswanthpur, Bangalore – 560 022, Karnataka, Factory-2: Dobbespet, Off. Bangalore. Factory-3: Plot No.: 88, Chandaka, B-Sector, Industrial Estate, Bhubaneswar, Orissa, Factory-4: Hosur, Dharmapuri District, Tamilnadu Rubber Plantation: Amasebil Village, Kundapura Taluk, Dakshin Kannada District, Karnataka.
Area :	100000 Sq. ft.
Location :	Owned
Coir Division Office :	32/2451, A-2, Namaskar Buildings, S N Junction, Palarivattom, Cochin – 25.
Sales Offices :	Located at: v Ahmedabad, v Aurangabad, v Bangalore (No.3, 1^st Cross St Queens Road, Bangalore – 2, and At 29/26, J C Road, Bangalore, Karnataka, INDIA. v Baroda, v Bhopal, v Bhubaneshwar, v Mumbai, v Burdwan, v Calcutta, v Calicut, v Chandigard, v Cochin v Coimbatore, v Faridabad, v Ghaziabad, v Goa, v Guwahati, v Hoshiarpur, v Jabalpur, v Jodhpur, v Hubli, v Hyderabad, v Indore, v Jammu, v Jaipur, v Jalandhar, v Kanpur, v Chennai, v Madurai, v Mangalore, v Mysore, v Nagpur, v New Delhi v Patna, Pune v Raipur, v Rajkot, v Ranchi, v Rourkela, v Siliguri, v Surat, v Tirupati, v Visakhapatnam, v Varanasi.
Tel. No. :	91 – 80 – 22233212 (Bangalore)

DIRECTORS

As on : 29.09.2010

Name :

Mrs. Jaya S. Pai

Designation :

Managing Director

Date of Birth/Age :

23.08.1958

Date of Appointment :

11.03.2005

Din No.:

00030515

S.No.	CIN	Name of the Company	Current designation of the director	Date of appointment at current designation	Original date of appointment	Date of cessation	Company Status	Defaulting status
1	U65993KA1994PTC015958	MANIPAL HOLDINGS PRIVATE LIMITED	Director	31-07-01	31-07-01	-	Active	NO
2	U99999MH1997PTC111438	JITENDRA HARJIVANDAS SECURITIES PRIVATE LIMITED	Director	11-01-02	11-01-02	-	Active	NO
3	U67120KA1995PLC017705	MANIPAL STOCK AND SHARE BROKERS LIMITED	Director	05-11-02	05-11-02	-	Active	NO
4	U17214KA1962PLC001443	KURLON LIMITED	Director	15-06-07	11-03-05	-	Active	NO
5	U85110KA2006PTC038793	ANAMALLAIS HOSPITALITY PRIVATE LIMITED	Director	20-02-07	20-02-07	08-02-08	Active	YES
6	U51909KA2008PLC048067	KURLON TRADE AND INVESTMENT LIMITED	Director	21-10-08	21-10-08	-	Active	NO
7	U65910KA1984PLC005876	SEA ROCK INVESTMENT LIMITED	Director	25-07-09	25-07-09	-	Active	YES
8	U65910KA1983PLC005749	CHITRAKALA INVESTMENT TRADE AND BUSINESS FINANCE LIMITED	Director	25-07-09	25-07-09	-	Active	YES
9	U85110KA1989PTC010535	MANIPAL BUILDERS AND DEVELOPERS PRIVATE LIMITED	Director	25-07-09	25-07-09	-	Active	YES
10	U21014KA1982PTC004659	EFFICIENT MANAGEMENT SERVICES PRIVATE LIMITED	Director	25-07-09	25-07-09	-	Active	NO
11	U74999KA1993PTC014946	JAYAMAHAL TRADE AND INVESTMENTS PRIVATE LIMITED	Director	25-07-09	25-07-09	-	Active	YES
12	U85110KA1946PTC001122	JAIBHARAT MILLS PRIVATE LIMITED	Director	25-07-09	25-07-09	-	Active	YES
13	U67120KA1991PTC012022	ANIL SUNIL TRADE AND INVESTMENT PRIVATE LIMITED	Director	25-07-09	25-07-09	-	Active	NO
14	U65910KA1984PTC005874	RAJMAHAL TRADE AND INVESTMENTS PRIVATE LIMITED	Director	25-07-09	25-07-09	-	Active	YES
15	U34102KA1994PTC015899	MANJUNATH SUSPENSION PRODUCTS PRIVATE LIMITED	Director	27-07-09	27-07-09	27-08-09	Active	NO
16	U67120KA1940PLC001103	GENERAL INVESTMENT AND COMMERCIAL CORPORATION LIMITED	Director	27-07-09	27-07-09	-	Active	NO
17	U70102KA2011ULL056471	MANIPAL INFRASTRUCTURE LIMITED	Director	03-01-11	03-01-11	-	Active	NO
18	U36101MH2011PLC222657	KURLON ENTERPRISE LIMITED	Director	03-10-11	03-10-11	-	Active	NO

Name :

Mr. Nitin Gajanan Rao Khot

Designation :

Director

Address :

B.C. 27, Fort, Belgaum – 590016, Karnataka, India

Date of Birth/Age :

10.09.1948

Date of Appointment :

22.10.1994

Din No.:

00030613

S.No.	CIN	Name of the Company	Current designation of the director	Date of appointment at current designation	Original date of appointment	Date of cessation	Company Status	Defaulting status
1	U17214KA1962PLC001443	KURLON LIMITED	Director	22-10-94	22-10-94	-	Active	NO
2	U36101MH2011PLC222657	KURLON ENTERPRISE LIMITED	Director	03-10-11	03-10-11	-	Active	NO

Name :

Mr. S Ananthanarayanan

Designation :

Director

Date of Birth/Age :

22.06.1935

Date of Appointment :

16.06.2006

Din No.:

00025505

S.No.	CIN	Name of the Company	Current designation of the director	Date of appointment at current designation	Original date of appointment	Date of cessation	Company Status	Defaulting status
1	U31109KA1989PTC010074	DHRUVA ENERGY SYSTEMS PRIVATE LIMITED	Director	26-09-01	26-09-01	26-12-07	Strike off	NO
2	U17214KA1962PLC001443	KURLON LIMITED	Director	16-06-06	16-06-06	-	Active	NO
3	U36101MH2011PLC222657	KURLON ENTERPRISE LIMITED	Director	03-10-11	03-10-11	-	Active	NO

Name :

Mr. Kumble Taranath Bhagath

Designation :

Director

Date of Birth/Age :

24.07.1927

Date of Appointment :

13.09.1984

Din No.:

00057971

S.No.	CIN	Name of the Company	Current designation of the director	Date of appointment at current designation	Original date of appointment	Date of cessation	Company Status	Defaulting status
1	U17214KA1962PLC001443	KURLON LIMITED	Director	13-09-84	13-09-84	-	Active	NO
2	U01132KA1988PTC009737	K.T. PLANTATIONS PRIVATE LIMITED	Managing director	21-05-90	21-05-90	-	Active	NO

Name :

Mr. Sudhakar Pai Tonse

Designation :

Managing Director

Address :

No.5, Chitrakala, Anathnagar, Manipal, Udupi – 576119, Karnataka, India

Date of Birth/Age :

26.04.1953

Date of Appointment :

15.06.2007

Name :

Mrs. Shital Darak Mandhana

Designation :

Secretary

Address :

462A, 7^th B Cross, 5th Main, Jagadeesh Nagar, New, Thippasandra Post, Bangalore-560075, Karnataka, India

Date of Birth/Age :

25.12.1984

Date of Appointment :

22.03.2010

Name :

Mr. Kumble Taranath Bhagath

Designation :

Director

Address :

Flat No-1, Prestige Dafodiles, Langford Town, BG-25, No-6, Berile Street, Bangalore, 560025, Karnataka, India

Date of Birth/Age :

24.07.1929

Date of Appointment :

13.09.1984

KEY EXECUTIVES

Name :	Mr. Madhwesh K
Designation :	Company Secretary
Address :	637, No. 118, 21^st Cross, Jayanagar 4^th block, Bangalore, Karnataka, India.
Date of Birth/Age :	19.02.1981
Date of Appointment :	19.03.2008
Name :	Mrs. Shital Darak Mandhana
Designation :	Secretary
Address :	462A, 7th B Cross, 5th Main, Jagadeesh Nagar, New, Thippasandra Post, Bangalore-560075, Karnataka, India
Date of Birth/Age :	25.12.1984
Date of Appointment :	22.03.2010

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 30.09.2010

Names of Shareholders	No. of Shares
Jaya S Pai	12002
Nitin Gajanan Rao Khot	83016
Tonse Sudhakar Pai	30000

AS ON

Equity Shares Break Up	Percentage
Bodies Corporate	92.50
Directors or relatives of directors	1.56
Other top Fifty (50) Shareholders	3.89
Others	2.05
Total	100.00

Subject, until about 2001, was a subsidiary of Maharashtra Apex Corporation Limited, which held 4,765,320 shares.

Subsequently, from about 2002, subject has ceased to become a subsidiary of Maharashtra Apex Corp. Limited.

BUSINESS DETAILS

Line of Business :	Manufacturer, Importer and Exporter of Rubberised Coir products (such as mattresses, beds, pillows etc.), plain/curled coir products (such as mats and spreads etc.) and polyurethan foam
Products :	Home and Sleep Comfort Products.
Brand Names :	“Kurlon”, “Kurlo-Mat”, “Comforel”.

PRODUCTION STATUS (As on 31.03.2010):-

Particulars	Unit	Installed Capacity	Actual Production
Rubberized Coir*	M.T.	15000	18089
Polyurethane Foam**	M.T.	675	1232
Polyurethane Foam***	M.T.	6100	5046
Polyurethane Foam***	M.T.	Nil	367

Note :

* Before adjustment of Moisture loss / rejection.

** In house consumption for Coir mattresses production

*** For commercial production including pillow division.

**** Produced at Roorkey Factory ( Uttaranchal State) Commercial Production started from 11.03.2010

GENERAL INFORMATION

No. of Employees :

120 (Approximately)

Bankers :

v State Bank of India, Industrial Finance Branch, Residency Road, Bangalore- 560025, Karnataka

v Bank of Baroda, Corporate Banking Branch, Richmond Road, Bangalor-560025, Karnataka

v Abu Dhabi Commercial Bank, Infantary Road, Bangalore - 560001

Facilities :

Particulars	31.03.2010 (Rs. In Millions)	31.03.2009 (Rs. In Millions)
Cash Credit (Secured by Hypothecation of Inventories, Book Debts and by first and second charge on specific Fixed Assets, and by the personal guarantee of Managing Director)	234.203	227.922
Bill Discounting (Secured by first charge on specific fixed assets and by the personal guarantee of Managing Director)	0.000	17.717
Term Loan* (Secured by first charge on specific fixed assets and by the personal guarantee of Managing Director)	232.055	168.091
Term Loan* (Secured by first charge on specific fixed assets)	0.000	16.013
From Financial Institutions :
Bill Discounting	0.000	3.399
(Secured by second charge on specific fixed assets and by the personal guarantee of Managing Director)
Hire Purchase from financial institutions / others* (Secured by Hypothecation of specific Vehicles)	5.309	3.585
Total Secured Loans	471.568	436.729
Unsecured Loans: Interoperate Deposit	4.000
Total Unsecured Loans	4.000	4.000
* Includes due within one year
Total	4.000	4.000

Banking Relations :

Satisfactory

Auditors :

Name :

Deloitte, Haskins and Sells,

Chartered Accountants

Address :

Deloitte Centre, Anchorage ll, 100/2 Richmond Road, Bangalore – 560 025, Karnataka

Tel. No. :

91-80-66276000

Fax No. :

91-80-66276011

Subsidiaries :

· Kurlon Cesare Furniture Private Limited

Associates :

· Maharashtra Apex Corporation Limited

· Commercial Corporation of India Limited

· Kurlon International General Trading LLC (upto March 24,2009)

Related Parties :

· General Investments and Commercial Corporation Limited

· Manipal Stock and Share Brokers Limited

· Manipal Holdings Private Limited

· Manipal Ecommerce Limited

· Manipal Home Finance Limited

· Jayamahal Trade and Investments Private Limited

CAPITAL STRUCTURE

as on 27.09.2008

Authorised Capital :

No. of Shares	Type	Value	Amount
25000000	Equity Shares	Rs. 10/- each	Rs. 250.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
14872870	Equity Shares	Rs. 10/- each	Rs.148.729 millions

Of The Above:

· 845836 Equity Shares of Rs.10/- each (Py8458360 Equity Shares of Rs.1/- each) were allotted by way of fully paid-up bonus shares in earlier years by capitalization of reserves.

· 345810 Equity Shares of Rs.10/- each (py 345810 Equity Shares of Rs.1/- each) were allotted for consideration received other than cash to the share holders of Brstwhile DKL Trading Company limited in the ratio of 1 38 as per the scheme of amalgamation sanctioned by Honorable High Court of Karnataka.

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		148.728	148.728	148.729
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		688.848	526.945	418.561
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		837.576	675.673	567.300
LOAN FUNDS
1] Secured Loans		471.568	436.729	462.604
2] Unsecured Loans		4.000	4.000	4.203
TOTAL BORROWING		475.568	440.729	466.807
DEFERRED TAX LIABILITIES		36.956	30.607	12.007
Others		1.507	2.122	2.741
TOTAL		1351.607	1149.131	1048.845
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		663.765	529.201	546.306
Capital work-in-progress		8.362	6.402	0.000
INVESTMENT		20.402	25.002	7.804
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	437.174	459.650	534.353
	Sundry Debtors	570.268	551.704	481.499
	Cash & Bank Balances	241.666	134.070	90.968
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	466.050	292.641	337.645
Total Current Assets		1715.158	1438.065	1444.465
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	384.064	306.467	395.383
	Current Liabilities	288.891	267.454	215.389
	Provisions	383.125	276.067	338.958
Total Current Liabilities		1056.080	849.988	949.730
Net Current Assets		659.078	588.077	494.735
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		1351.607	1148.131	1048.845

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Income	4088.133	3672.506	3265.209
		Transfer for Investment Fluctuation Reserves	0.050	0.000	0.000
		Other Income	13.339	5.713	6.403
		TOTAL (A)	4101.522	3678.219	3271.612
Less	EXPENSES
		Manufacturing and Selling Expenses	3663.135	3343.915	3004.993
		Increase / (Decrease) in inventory	14.676	(11.786)	19.160
		Prior period adjustments	0.000	0.000	21.887
		TOTAL (B)	3677.811	3332.129	3046.040
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		423.711	346.090	225.572
Less	FINANCIAL EXPENSES (D)		46.116	65.161	47.578
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		377.595	280.929	177.994
Less/ Add	DEPRECIATION/ AMORTISATION (F)		41.385	36.833	26.937
	PROFIT BEFORE TAX (E-F) (G)		336.210	244.096	151.057
Less	TAX (I)		125.500	101.362	62.283
	PROFIT AFTER TAX (G-I) (J)		210.710	142.735	88.774
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		232.163	138.502	93.407
Less	APPROPRIATIONS
		Transfer to General Reserve	21.071	14.273	8.877
		Dividend	37.182	29.745	29.745
		Tax on Dividend	6.175	5.055	5.055
	BALANCE CARRIED TO THE B/S		378.445	232.163	138.502
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	11.190	16.308	15.284
	TOTAL EARNINGS		11.190	16.308	15.284
	IMPORTS
		Raw Materials	215.424	170.324	133.266
		Stores & Spares	3.631	3.011	0.000
		Capital Goods	28.947	4.009	32.286
		Others	16.606	33.478	26.864
	TOTAL IMPORTS		264.608	210.822	192.416
	Earnings Per Share (Rs.)		14.17	9.60	5.97

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	5.13	3.88	3.50
Net Profit Margin (PBT/Sales)	(%)	8.22	6.64	4.63
Return on Total Assets (PBT/Total Assets}	(%)	14.13	12.40	7.59
Return on Investment (ROI) (PBT/Networth)		0.40	0.36	0.26
Debt Equity Ratio (Total Liability/Networth)		1.82	1.91	2.50
Current Ratio (Current Asset/Current Liability)		1.62	1.69	1.52

LOCAL AGENCY FURTHER INFORMATION

HISTORY

Subject was incorporated on 9^th February 1962 at Manipal in Karnataka having Company Registration No. 08-1443.

The company was originally incorporated with the name and style of “Karnataka Consumer Products Limited”. The name of the company has been changed as “KURLON LIMITED” w.e.f. 14^th March, 1996.

PERFORMANCE

During the year the Company has achieved a 11% increase in total income at Rs. 4088.133 millions compared to Rs.3672.506 millions of previous year. The Profit before tax is 336.210 millions in the current year compared to Rs.244.096 millions of the previous year. The profit after tax is increased from Rs. 142.735 millions to Rs. 210.711 millions during the year..

OPERATIONS

This fiscal year has remained a challenging year for the company. Widening our product range by introducing many innovative and ’first time' products, your company continued to penetrate into tier 2 and 3 markets and added new dealer counters with an aim to enlarge the market share. In addition to that, all our marketing activities this year were entirely focused on customer service especially on improvement in commitment of deliveries.

Introduction of new products enabled your company to get in to different segments of the market and improve the offerings to the dealer segment as well as varied choice for the end users. Kurlon became one of the very few manufacturers offering range of products not only in mattresses but also in bedlinen, furniture, pillows and furnishings giving opportunities for the trading segment to get variety of products from one source like Kurlon. We also noticed the change in behavior of the consumers using health care products and involve in purchase of mattresses where they spend 1/3rd of their life time. There was improvement in sales of spring mattresses where the No turn technology gets an edge over competition and your company plans to expand this market and put up manufacturing units for becoming a major player in this segment too. The innovative mattresses, Valentino, Triazo and other luxury Healthcare mattresses are being welcomed by the dealers as well as customers in the marketplace. It was yet another successful year for Kurlon Kare Klub members, with their continued patronage; it gives us great confidence to enter newer markets. Extraordinary growth resulted from this segment of dealers.

FUTURE OUTLOOK

As an established player in the mattress industry the Company envisage enough opportunity and potential for growth in the future. On the basis of potential for growth in foam industry, the Company has established a new manufacturing plant in Uttaranchal, which is expected to grow and stabilize production during the current year. As per the Company’s strategic initiative, ample of opportunities are available in the segment of home-comfort business in India. As Indian economy is growing with high velocity, it is expected that furniture and furnishing industry will also grow with the same rate thereby giving an opportunity of growth in this segment to Kurlon in future. Export business for mattress and furniture is being looked in to by the Company. During the year, the Company was able to further expand its export business to Middle East Countries. To supervise, control and systematically operate distribution network which is already established in Middle East countries, the Company incorporated its wholly owned subsidiary named Kurlon International Trade (FZE) in a Free Trade Zone Area of Sharjah- UAE.

JOINT VENTURE

The Joint Venture between Kurlon and Cesare’s has terminated during the year due to unavoidable continuous losses. Joint- Venture Company ‘Kurlon Cesare Furniture Private Limited.’, remains a subsidiary Company of Kurlon Limited and continues to carry on its business under Kurlon supervision and banner.

SUBSIDIARY COMPANIES

As per requirement of Section 212 of the Companies Act, 1956 the Profit and Loss Account for the year ended 31st March 2010 and the Balance Sheet as on that date and the reports of Directors and Auditors of M/s. Kurlon Cesare Furniture Private Limited, statement of the holding company’s interest in the subsidiary companies is attached to the Balance Sheet of the Company. Another wholly owned subsidiary Company M/s. Kurlon International Trade (FZE) has been recently incorporated in the financial year 2010-11, is yet to start its business and earn significant revenue.

MANAGEMENT DISCUSSION AND ANALYSIS

INDIAN ECONOMY AND GLOBAL FINANCIAL MARKETS:

The year 2009 began with a very high degree of uncertainty and volatility in India as well as the global economy. Global Financial Markets have recovered strongly in 2009 since their troughs in aftermath of the collapse of Lehman Brothers in middle of 2008. This recovery was spurred by improving economic fundamentals and sustained policy support. Risk appetite has returned, equity markets have improved and capital markets have reopened. After three continuous years of over 9% growth, shrinking global demand and associated fall in business confidence had reduced India’s annual GDP growth rate to 6.7% in 2008-09. The sluggishness continued in the beginning of 2009-10 especially leading up to the general election. With the election throwing up a stable Government, there was renewed confidence among investors in India. Thereafter, we have witnessed a steady pick-up in economic and investing activity, especially since the middle of the second quarter. The estimate from CSO ( Central Statistical Organization) suggests that GDP growth for 2009-10 will be 7.2%. whatever the number, it is clear that India has recovered and is poised to be back on its 8% plus annual growth trajectory.

As per the quick estimates of Index of Industrial Production and Use-based Index for the month of April, 2010, the Sectoral growth rates in April 2010 over April 2009 are 8.8% in Basic goods, 72.8% in Capital goods and 10.8% in Intermediate goods. The Consumer durables and Consumer non-durables have recorded growth of 37.0% and 6.6% respectively, with the overall growth in Consumer goods being 14.5%.

INDUSTRY STRUCTURE AND DEVELOPMENT:

The Company is not only in industry of rubberized coir mattresses, foam mattresses and spring mattresses but also in furniture and furnishing industry. Among mattresses, rubberized coir and foam mattresses have the larger share of the market. Currently, the global annual production of coir fiber is about 350,000 metric tons (MT) out of which 90% is produced in India and Srilanka though underutilized. Traditional uses for the resilient and durable coir fiber include rope and twine, brooms and brushes, doormats, rugs, mattresses and other upholstery, often in the form of rubberized coir pads. In the 1980s and 90s, global exports of coir fiber fell by almost half, as Western consumers shifted to synthetic foam and fibers. The exports from this industry are around Rs. 700.000 millions. Coconut husk is the basic raw material for coir products. Around 50 per cent of the available coir husk is used to produce coir products. Hence, there is scope for growth of coir industry vis-a-vis rubberized coir mattresses. As regards, foam mattresses, the most important ingredient for the production of the same is POLYOL + ISOCYANATE + CATALYSTS + SURFACTANTS + BLOWING AGENTS = POLYURETHANE FOAM. This chemicals are being imported and easily available in the market. Depending on the type of polyol and isocyanine used the generated foam exhibits different properties vis-à-vis different types of mattresses. India will consume 1 kg of polyurethane (PU) per capita by 2020 at 1200,000 tpa, as per a conservative estimate by the Chairman of the Indian Polyurethane Association (IPUA). Current per capita PU consumption in India is about 200 grams. The 1 kg per capita target will be possible, depending mainly on easing bureaucracy by the government that will speed up some of the processes and make it easy to set up factories and help to build infrastructure, as well as initiatives by the industry. At annual consumption levels of 180,000 tons of Polyurethane (PU) in 2007, India has just about 1.5% share of the global PU consumption of 11.25 min tons. In the last few years PU has grown at over 15% pa, and is expected to continue to be robust at an average rate of 15%. PU consumption in 2012 could reach more than 350,000 tons and could possibly touch 400,000 tons. India has a population of over one billion people, of which it is estimated less than 10% sleeps on a foam-based mattress. Hence there exists a good growth potential growth for PU foam in India. However, the dominance of natural bedding products, at times subsidized or protected by import duties on substitute materials, has also hindered the market penetration of PU foams at times. The Indian bedding market is substantial and dominated by low cost coir (coconut fiber), latex and cotton mattresses, but people are increasingly looking to upgrade to higher quality products made from or incorporating PU foam.

OUTLOOK

The Company has set up manufacturing facilities for foam in Uttaranchal and a unit for sofa manufacturing in Bangalore during the current year. Kurlon is one of the very few branded manufacturing unit in India. Kurlon expects to emerge as a major player in this segment. There are huge opportunities for exports in European market as well. As expected Kurlon crossed a Turnover of Rs. 4000.000 millions during the year and maintained leadership position in mattress segment. Kurlon, has positioned itself a supplier of varied range of mattresses and introduced healthcare products which was welcomed by dealers as well as consumers.

CONTINGENT AND CONTINGENT LIABILITIES

(Rs. In Millions)

Particulars	31.03.2010 (Rs. In Millions)
Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances)	10.600
Corporate Guarantee given on behalf of other companies.	52.000
Disputed demands under appeal not provided
For Sales Tax [appeal deposits of Rs. 6.066 millions (Previous year Rs. 4.801 millions)]	126.459
Advance License for clearance of Import	1.130

Fixed Assets:

Tangible Assets

v Land

v Building

v Plant and Machinery

v Computers

v Furniture and Fittings

v Office Equipments

v Vehicles

Intangible Assets

v Software

Form 8:-

Corporate identity number of the company	U17214KA1962PLC001443
Name of the company	Kurlon Limited
This form is for	Modification of charge
Address of the registered office or of the principal place of business in India of the company	N-301, IIIrd Floor, North Block, Front Wing, Manipal Centre, 47, Dickenson Road, Bangalore – 560042, Karnataka, India
Type of charge	Book Debts Movable Property Floating Charge
Particular of charge holder	IDBI Bank Limited Bangalore Main Branch IDBI House No.58, Mission Road. Bangalore-560027, Karnataka-KA, India.
Nature of description of the instrument creating or modifying the charge	Joint Deed Of Hypothecation.
Date of instrument Creating the charge	09.07.2011
Amount secured by the charge	Rs.514.700 millions
Brief particulars of the principal terms an conditions and extent and operation of the charge	Rate of Interest Rate of interest for IDBI Bank Limited (Exclusive of Interest Tax other Levies/Duties) BPLR-1.25 bps (Presently BPLR is @13.25% p.a.) Payable Monthly. (Subject to minimum of 12% p.a.) Penal Interest for Non-Compliance of terms of sanction : Max2% p.a. over the normal rate. Prepayment Penalty as per terms of sanction for other Banks in the Consortium as per terms of sanction by respective Banks. Terms of Repayment WLC- On Demand. Advance is for a period of 12 months and subject to review as per sanction Margin 20% of current Assets for IDBI Bank as per terms of sanction by the respective Banks in the consortium Extent and Operation of the charge (a) The charge operates as security, inter alia, for the due repayment by Co to IDBI consortium (comprising of IDBI Bank Limited, SBI, BOB and AXIS Bank Limited) of its aggrt wlc facilities of Rs. 514.700 millions sanctioned together with interest, additional interest, liquidated damages, premia on redemption, costs, charges, expenses and all other money payable by the Company to IDVI Consortium in terms of WCL Consortium Agr date 09.07.2008 and shall rank pari-passu. Others Members of the IDBI consortium. (b) The Company has undertaken to keep the goods hypothecated in marketable and good condition at its own costs and to insure the same in the joint names of the Company and the members of the IDBI consortium. (c) All goods hypothecated and all realizations and insurance proceeds thereof and all documents in respect of the said security are to be kept distinguishable and held as the exclusive prop of the members IDBI Consortium.
Short particulars of the property charged	The whole of the Current Assets of the company namely, stocks of raw materials. Stocks in Process, Semi-finished and finished Goods, Stores and Spares (consumable Stores and Spares), Bill Receivable and Book Debts and all other movables, both present and future and more particularly described in the Schedule to the Joint Deed of Hypothecation attached hereto.
Particulars of the present modification	The amount secured stands increased from Rs.320.000 millions to Rs.514.700 millions The consortium is IDBI Bank Limited and the consortium is now known as IDBI Consortium the securities described in col no.14 is available for enhanced limit IDBI Bank Limited entered the consortium all other terms and conditions remain unchanged

WEBSITE DETAILS ATTACHED:

Subject is into the business of pure comfort. A head start in the business in 1962 by Mr. Ramesh Pai, the chairman, it is now looking into an extensive brand extension, and a complete makeover - from sleep comfort, to home comfort.

To give its expanding activities a definite direction and a wider dimension, Subject is repositioning itself as a major player in the comfort industry rather than a leader in just the mattress business. Thus operating on a larger canvas, the company will have more room to grow, and will manufacture a whole wide range of trusted quality products for its customers.

Subject is a Manipal Group Company came into existence in 1962. The Company was then called 'Karnataka Consumer Products Ltd' and on the 8^th of December, 1995 the Company was renamed as Subject .

Subject is part of the 2,000 crore Manipal Group of companies founded by the Pai's of Manipal which is a major financial and industrial group in India. The Group has its activities spread over Financial Services, Manufacturing, Education, Electronic Commerce, Software Services, Share Broking, etc. The Group is headed by Mr. T. Ramesh U. Pai who is the Chairman of the Group. Mr. Pai is on the Boards of several well-known Industrial, Commercial and Educational Enterprises.

Subject was conceived when Mr. Pai was in Germany in 1959. He found that car seat cushions were manufactured of rubberised coir. The manufacturer was importing curled coir from Sri Lanka.In India, the coir industry has developed very well, mostly in Kerala where they produce 'Retted Fibre'. Green husks of coconut are immersed in the salty backwaters for 10 to 12 months and the retted husk is supplied to various homes to make Mats and Matting rolls after producing the yarn from this fibre. This has created employment to many women in the State.

Austrian technology was available to extract fibre from the dried coconut husk and curl it into ropes and keep it in that state for minimum 3 months. When uncurled, curled coir becomes tiny springs. The cars manufactured in India in 60s were very few in numbers. It was uneconomical to start the moulded product out of the rubberised coir to manufacture car seat cushions. After a lot of experiments and quality control steps, Mr.Ramesh Pai thought of entering into Rubberised Coir mattress manufacturing. Thus, Subject was born. became one of the most popular mattresses providing restful sleep to Indian consumers.

Today Subject has created direct employment over 1000 people and indirect employment to lakhs of coir workers across the sub-continent. Subject's success is built on a solid infrastructure and its powerful marketing strength. The Company has 44 Sales Offices, which are profit centers, strategically located all over the country. All the centers are working on and trade terms. The Company products are exported to West Asia viz; U.A.E., Qatar, Oman, Bahrain, UK, Europe, South and East of Africa, Indian Ocean rim, SAARC, South East and Far East countries.

Subject is the brand leader in the industry and has acquired major market share in the branded mattresses segment. Taking advantage of the market potential, Subject strongly believes in giving the customers quality products of a wide range at competitive prices, which will result in customer satisfaction.

Kurlon Nest

Kurlon has been dedicated to the comfort and convenience of its customers for years. With their convenience in mind, Kurlon has conceptualized a chain of outlets to bring the whole range of comfort products, under one roof.

Kurlon Nest offers you the entire range of home and sleep comfort products arranged in an exquisitely arranged platter, in the form of its showrooms. It encompasses the feel of a home, with an excellently, trained customer support group for assistance. Currently functioning in Delhi, and Bangalore, prospects of opening more outlets of Kurlon Nest across India will materialize in the near future.

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. 49.08
UK Pound	1	Rs. 78.65
Euro	1	Rs. 67.79

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	8
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	8
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	8
--LEVERAGE	1~10	8
--RESERVES	1~10	7
--CREDIT LINES	1~10	7
--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		66

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.