MIRA INFORM REPORT

Report Date :

07.10.2011

IDENTIFICATION DETAILS

Name :	SYNCOM HEALTHCARE LIMITED
Registered Office :	221, Vyapar Bhawan, P. D’mello Road, Mumbai – 400009, Maharashtra, India
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	29.07.2002
Com. Reg. No.:	11-136652
Capital Investment / Paid-up Capital :	Rs.400.000 Millions
CIN No.: [Company Identification No.]	L51397MH2002PLC136652
TAN No.: [Tax Deduction & Collection Account No.]	MUMS38639G
PAN No.: [Permanent Account No.]	AATFS5263J
Legal Form :	A Public Limited Liability company. The company’s Shares are Listed on the Stock Exchange.
Line of Business :	Manufacturer and trader of pharmaceuticals, medicine, drugs, etc.
No. of Employees :	412 [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 6860000
Status :	Satisfactory
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is an established company having satisfactory 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 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 – June 30, 2010

Country Name	Previous Rating (01.04.2010)	Current Rating (30.06.2010)
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 :	221, Vyapar Bhawan, P. D’mello Road, Mumbai – 400009, Maharashtra, India
Tel. No.:	91-22-23725193
E-Mail :	hrd@syncomhealthcare.com sanjaymehta.associates@gmail.com
Website :	http://www.syncomhealthcare.com
Head Office :	351, Saket Nagar, Indore – 452001, Madhya Pradesh, India
Corporate Office :	‘Syncom House’ 40, Niranjanpur, Dewas Naka, AB Road, Indore - 452010, Madhya Pradesh, India
Tel. No.:	91-731-2577471 to 73 / 2704381 / 3200888
Fax No.:	91-731-2577470 / 2704380
E-Mail :	shl@syncomhealthcare.com
Factory :	D – 42, UPSIDC Industrial Area, Selaqui, Dehradun - 248197, Uttarakhand, India
Tel. No.:	91-135-2699131 / 2699017
Fax No.:	91-135-2698220
E-Mail :	works@syncomhealthcare.com

DIRECTORS

As on 31.03.2011

Name :	Mr. Ajay Shankarlal Bankda
Designation :	Chairman cum Managing Director
Address :	‘Syncom House’ 293/1, Niranjanpur, Dewas Naka, AB Road, Indore - 452010, Madhya Pradesh, India
Date of Birth/Age :	26.09.1960
Date of Appointment :	29.07.2002
Name :	Mr. Jagdish Prasad Bagaria
Designation :	Director
Address :	221, Vyapar Bhawan, P. D’mello Road, Mumbai – 400009, Maharashtra, India
Date of Birth/Age :	06.10.1947
Date of Appointment :	29.07.2002
Name :	Mr. Bharat Kumar Doshi
Designation :	Director
Name :	Mr. Govind Das Pasari
Designation :	Director
Date of Birth/Age :	29.01.1955
Qualification :	B.Com
Experience :	He is having more than 30 years experience in the field of marketing of the pharmaceutical products. He is also working as C and F Agent of various leading pharmaceutical Companies
Date of Appointment :	28.05.2008
Other Directorship :	Neeta Medicos Private Limited
Name :	Mr. Avichal Kasliwal
Designation :	Director
Date of Birth/Age :	05.11.1958
Qualification :	B.Com. and LLB Hons.
Experience :	He is having more than 18 years of experience in the field of furnishing. He has promoted Beleza Furnishing Private Limited engaged in marketing of the furnishing materials.
Date of Appointment :	02.06.2008
Other Directorship :	Beleza Furnishing Private Limited

KEY EXECUTIVES

Name :	Mr. J. C. Paliwal
Designation :	Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 30.06.2011

Names of Shareholders	No. of Shares	Percentage of Holding
(A) Shareholding of promoters and Promoter Group
1. Indian
Individuals / Hindu Undivided Family	9676307	51.06
Any Other [specify]	323693	1.71
Any other	323693	1.71
Sub Total (A) (1)	10000000	52.77
(B) Public Shareholding
1. Institutions
Foreign Institutional Investors	54000	0.28
Sub Total (B) (1)	54000	0.28
2. Non Institutions
Bodies Corporate	2856046	15.07
Individual shareholders holding nominal share capital up to Rs. 0.100 million	4140300	21.85
Individual shareholders holding nominal share capital in excess of Rs. 0.100 million	1425581	7.52
Any other [specify]	474073	2.50
Clearing Members	391822	2.07
Non resident Indians	82251	0.43
Sub Total	8896000	46.94
(B) = (B) (1) + (B) (2)	8950000	47.23
Shares held by custodians and against which depository receipts have been issued (C)	-	-
Public	21050000	-
Total (A) + (B) +(C)	40000000	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer and trader of pharmaceuticals, medicine, drugs, etc.

Products :

Products Description	ITC Code No.
Paracetamol - Formulations Thereof, In Tablets Etc.	30049061
Ceteirzine - Formulations Thereof, In Tablets Etc.	30049031
Antihistaminics Drugs	30049029

PRODUCTION STATUS As on 31.03.2011

Particulars	Unit	Installed Capacity	Unit	Actual Production
Tablet	Nos. (Crores)	150.00	Nos.	646041205
Capsule	Nos. (Crores)	10.00	Nos.	14005233
Liquid Oral	Ltrs. (Lacs)	15.00	Ltrs.	852755
Ointment	Kg (Lacs)	1.50	Kg	166062
Eye /Ear Drop [Vial/Drops]	Ltrs. (Lacs)	0.80	Ltrs.	37177
Dry Powder	Kg (Lacs)	6.00	Kg	148891

GENERAL INFORMATION

No. of Employees :

412 [Approximately]

Bankers :

• Bank of India, Khajrana Branch, 202, Saket, Indore – 452001, Madhya Pradesh, India
• ICICI Bank Limited
• State Bank of India

Facilities :

Secured Loan [Rs. in million]	31.03.2011	31.03.2010
Term Loan From Bank Of India secured against first charge in the form of mortgage of land and building and hypothecation of plant and machinery of the company's unit at selaqui near dehradoon (repayable within a year 13.573 millions)	13.573	35.242
Hdfc Car Loan (secured by first charge in the form of hypothecation of car . repayable with in one Year Rs.0.684 million)	0.871	1.460
Working Capital Facilities From Bank Of India
Cash Credit Facilities	86.819	117.905
Working Capital Demand Loan	0.000	16.664
(the working capital facilities are secured against first charge on current assets of the company)
Total	101.263	171.271
Unsecured Loan [Rs. in million]	31.03.2011	31.03.2010
From Directors And Relatives	14.841	33.337
Inter corporate Deposits	32.900	10.900
ICICI Bank	27.349	28.069
(an amount of Rs.0.819 million is payable within next twelve months previous year Rs.0.720 million
Total	75.090	72.306

Banking Relations :	--
Auditors :
Name :	Sanjay Mehta and Associates Chartered Accountants
Address :	204-206, Modi Tower, M. T. H. Compound, Indore – 452001, Madhya Pradesh, India
Subsidiaries :	Syncom Healthcare International Fze
Other Related Parties :	Sinorita Biotech Private Limited Ajay Jyoti Estate Private Limited Bankda Estate Private Limited Bankda Reality Private Limited Vimla Housing Private Limited Bankda Developers Private Limited Bankda Housing Private Limited Kedar Vijay Housing Private Limited Ajay Laxmi Housing Private Limited Ultratech Energy Private Limited Styler Textiles Private Limited

CAPITAL STRUCTURE

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
40,000,000	Equity Shares	Rs. 10/- each	Rs.400.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
40,000,000	Equity Shares	Rs. 10/- each	Rs.400.000 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

Particulars		31.03.2011	31.03.2010	31.03.2009
SHAREHOLDERS FUNDS
1] Share Capital		400.000	175.000	100.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		1317.462	588.818	117.388
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		1717.462	763.818	217.388
LOAN FUNDS
1] Secured Loans		101.263	171.271	199.588
2] Unsecured Loans		75.090	72.306	110.475
TOTAL BORROWING		176.353	243.577	310.063
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		1893.815	1007.395	527.451
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		173.246	135.133	146.289
Capital work-in-progress		0.000	34.524	0.000
INVESTMENT		40.210	40.210	0.038
DEFERREX TAX ASSETS		19.918	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	110.294	107.075	96.284
	Sundry Debtors	430.849	477.613	284.891
	Cash & Bank Balances	895.803	159.673	1.450
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	321.770	219.601	54.178
Total Current Assets		1758.716	963.962	436.803
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	88.368	150.234	45.735
	Other Current Liabilities	0.529	0.173	0.000
	Provisions	9.798	16.656	14.392
Total Current Liabilities		98.695	167.063	60.127
Net Current Assets		1660.021	796.899	376.676
MISCELLANEOUS EXPENSES		0.420	0.629	4.448
TOTAL		1893.815	1007.395	527.451

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Income	755.908	668.515	605.647
		Other Income	32.040	4.479	0.103
		TOTAL (A)	787.948	672.994	605.750
Less	EXPENSES
		Material Consumed	183.628	161.182	116.663
		Finished Goods Purchased	379.106	332.577	299.180
		Manufacturing & Other Expenses	136.574	99.725	90.471
		Preliminary Expenses written off	0.209	0.209	0.209
		Increase /(Decrease) In Stock	1.608	[15.255]	0.101
		Deferred Revenue Expenditure W/Off	0.000	0.000	1.550
		TOTAL (B)	701.125	578.438	508.174
	PROFIT/LOSS BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		86.823	94.556	97.576
Less	FINANCIAL EXPENSES (D)		19.636	30.717	33.773
	PROFIT/LOSS BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		67.187	63.839	63.803
Less/ Add	DEPRECIATION/ AMORTISATION (F)		18.145	18.685	20.377
	Extra Ordinary Items		41.291	0.000	0.000
Add	Prior Period Expenses / (Incomes)		[0.081]	0.000	[0.328]
	PROFIT / LOSS BEFORE TAX (E-F) (G)		7.832	45.154	43.754
Less	TAX (H)		[18.452]	8.111	5.623
	PROFIT / LOSS AFTER TAX (G-H) (I)		26.284	37.043	38.131
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		143.939	106.896	68.765
	BALANCE CARRIED TO THE B/S		170.223	143.939	106.896
	EARNINGS IN FOREIGN CURRENCY		9.158	0.000	0.000
	Earnings Per Share (Rs.)		0.86	3.29	3.85

QUARTERLY RESULTS

PARTICULARS	30.06.2011
Type	1^st Quarter
Sales Turnover	184.730
Total Expenditure	172.790
PBIDT (Excl OI)	11.940
Other Income	6.420
Operating Profit	18.360
Interest	3.830
Exceptional Items	0.000
PBDT	14.530
Depreciation	5.330
Profit Before Tax	9.200
Tax	2.170
Reported PAT	7.030
Extraordinary Items	1.400
Prior Period Expenses	0.000
Other Adjustments	0.000
Net Profit	8.430

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	3.33	5.50	6.29
Net Profit Margin (PBT/Sales)	(%)	1.04	6.75	7.22
Return on Total Assets (PBT/Total Assets}	(%)	0.40	4.11	7.50
Return on Investment (ROI) (PBT/Networth)		0.00	0.06	0.20
Debt Equity Ratio (Total Liability/Networth)		0.16	0.54	1.70
Current Ratio (Current Asset/Current Liability)		17.82	5.77	7.26

LOCAL AGENCY FURTHER INFORMATION

REVIEW OF OPEATIONS:

During the year the Company has achieved a total income of Rs. 786.340 Millions as against the total income of Rs. 688.249 Millions in the previous year thereby registering an increase in turnover of 14%. The Company has earned a net profit of Rs. 49.042 Millions before tax and extra ordinary loss by way of foreign exchange currency fluctuation during the year as against the profit of Rs. 45.154 Millions in the previous year registering a marginal increase of profit. The loss on foreign exchange currency fluctuation represents the loss of exchange rates on the money lying in the Euram Bank, Austria raised against global depository receipts. These results could be achieved due to manufacture of a vide range branded quality of Ethical, OTC, Generic and Herbals products in its own Plant, contract manufacturing and other operations and marketing through an established distribution network. However, the operating profit was slightly lower due to increase in the prices of raw materials. The Company has carried out contract manufacturing for Rs. 170.000 Millions as against Rs. 100.000 Millions in the previous year from the well known Pharma players in the industry during the year . The Company intends to expand the contract manufacturing activities in near future.

FUTURE PLAN

The Company entered in the capital market at the end of January, 2010 through Initial Public Issue of 7500000 equity shares of Rs. 10/- each at an issue price of Rs. 75/- per equity shares aggregating Rs.562.500 Millions. The issue proceeds were proposed to be utilized for setting up a Unit for Pharmaceutical Formulation in SEZ at Pithampur for catering the needs of global requirement. The Company also planned to add additional equipments in the existing Plant at Dehradun in Uttarakhand for smoothening of the existing production facilities. The provision for meeting the working capital needs and general corporate use also envisaged.

The Company has completed up gradation in the existing unit at Dehradun. The SEZ authority has given a written confirmation for the allotment of the land of their choice but with the long follow up they expressed their inability to allot the desired land and instead asked to take alternate land at the remote area which is not convenient for us. In the last budget the Government brings in all the SEZ units within MAT tax cover. The proposed Direct Tax Code also brought in all the SEZ units within tax net and thus there is no benefit in putting any unit in SEZ. Thus, the Company is also considering shifting the plan of the Pithampur unit to Indore to have economic and better control. The Company has utilized up to 31.03.2011 Rs. 334.700 Millions on the project. The remaining amount was invested in short term advance (Rs. 183.300 Millions) and temporary invested in working capital (Rs. 44.500 Millions).

The Company has established a wholly owned subsidiary in the name and style of Syncom Healthcare International FZE in Ras Al Khaimah Free Trade Zone, Dubai with a nominal capital of AED 200000. All the facilities are procured from Ras Al Khaimah, Free Trade Zone in a Flexi rental Office in RAK. The office will be used for the trading purpose only. The General Trading License was given by the RAK Free Trade Zone Authority 27th April, 2011.

MANAGEMENT DISCUSSION AND ANALYSIS:

Industry Structure and Developments:

The global pharmaceutical market was estimated at US$ 875 billion, of which the US market, the largest, accounted for roughly 38%. According to IMS Health, the global pharmaceutical market is expected to grow 5-7% in 2011, compared to 4-5% in 2010. Grow will be driven by low-cost factors, increasing prevalence of diseases and rising per capita income. The global generics market was worth about US$ 89 BILLION IN 2009-10 and is expected to reach US$ 135 billion by 2015, growing at a10% CAGR.

India’s pharmaceutical market overview: The Indian pharmaceutical industry ranks third by drug volume (10% of global share) and fourteenth by value – about US$ 24.8 billion (3% of global sales). The industry is growing at around 1.5-1.6 times the country’s GDP growth (Source: The Financial Express). Industry growth is propelled primarily by exports, expanding 18.7% CAGR to US$ 9 billion in 2009 – 10 (2005 – 2010). During the same period, the domestic market grew at 13.5% CAGR to US$ 13.8 billion. The Indian pharmaceutical market growth continues to be driven by formulations for chronic therapies; acute therapies are expected to be largely driven by Tier-III cities and rural penetration.

Demand drivers: India’s low per capita expenditure on health is expected to correct to the global average, owing to steady economic growth, increasing disposable incomes and growing health awareness. Per capita income in rural areas is expected to increase from Rs.0.019 million at present to Rs.0.024 million by 2015, resulting in increased Pharma spending. Indian drug prices increased by only 1-2% annually over the last decade according to the IMS; per capita income of the average Indian accelerated 16.7% between 2006-07 and 2010-11, making healthcare more affordable. Indian government spending on healthcare increased 20% CAGR over the last four years (US$ 6.7 billion in 2005-06 to US$ 11.7 billion in 2008-09). The Government of India plans to cover 45% of India’s population by 2020. The government plans to establish a Rs.20 billion venture capital fund to promote drug discovery and strengthen infrastructure in the pharma sector to boose local innovation.

However it is worth noting that within such an adverse overall economic scenario, Indian Pharmaceutical Market has remained almost insulated from the global financial crisis.

Two key primary focus area of the Government, as many will agree, should be education and health of its citizen. The current National Health Policy has planned an overall increase in health spending of the Country as 6% of GDP by 2010. However, in 2008, India spent both public and private sector put together, around 5% of GDP on health.

India has 16% of the world’s population, 18% of its mortality, 20% of morbidity, yet the country’s healthcare expenditure is a miniscule, just 1% of global expenditure. As one of the fastest growing economies, India cannot continue to be ranked 171 out of the 175 countries surveyed by WHO based on percentage of GDP spent on public sector healthcare.

If they look at only the spending by the Government of India towards healthcare, it is just 1.2% of GDP, against 2% of GDP in China and 1.6% of GDP in Sri Lanka, as reported in the World Health Report 2006. It is therefore high time for India to give the necessary impetus to grow for the healthcare sector.

Strong GDP growth and significant cost advantages have resulted in the Indian Pharmaceutical industry growing significantly by 20% from around US $ 6.9 Bn in 2002-03 to around US $ 17 Bn in 2007-08. Indian participation in the international pharmaceutical market has increased and with more products going generic in the developed economies, the country’s domestic formulations and bulk drug exports have grown significantly. In addition, increasing cost pressures on global innovator companies has resulted in appreciable growth in Contract Research and Manufacturing Services (CRAMS) business in India. Driven by all these factors, Indian Pharmaceutical exports have grown at a CAGR of 27% in last six years to reach US $ 8.6 Bn in 2007-08

Outlook:

The company has invested in manpower in sales and marketing to consolidate and accelerate its growth. While keeping its focus on achieving a higher sales growth, the company continues to work on generating cost related efficiency in areas of Supply Chain, administrating expenses, selling expenses and Manufacturing expenses.

The company’s strategies for enhancement in key areas have presented an optimistic growth path to look forward. To create a sharper focus on market share expansion globally, the company is in process of establishing a pharmaceutical formulation unit in SEZ. On the growth front, they express cautions optimism against the backdrop of an unsatisfactory and progressively adverse economic environment.

Contingent Liabilities [As on 31.03.2011]

Following Contingent Liabilities were not provided in the books.

1. Legal suits filed by past employees towards salary claims with total Financial impact Rs.0.589 million. (Previous year Rs. 0.589 million)

2. A legal suit filed against the company for ownership of certain trademark where an ex-parte decree has been passed against the company for Rs. 0.500 million. The company has deposited the demand under protest as security money and has filed an appeal against the captioned order.(Previous year Rs. 0.500 million)

3. There is an Export Obligation of Rs. 0.750 million on the company for towards exemption of Custom Duty availed by the company on import of machinery under the EPCG Scheme of the government. (Previous year Rs.0.750 million).

4. There is demand of Rs. 0.581 million raised by Assistant Commissioner of Provident Fund against which company has filed appeal. (Previous Year Nil)

5. Bank Guarantee of Rs. 1.000 million have been given by the company to Health Department of Government of Punjab for tender business. (Previous Year Nil)

6. There is demand of Rs. 0.854 million raised by Income Tax Department for A.Y. 2005-06. Company has filed appeal against this demand and deposited Fifty percent of such demand.

FIXED ASSETS :

• Land
• Building
• Plant and Machinery
• Furniture and Fixtures
• Computer
• Office Equipments
• Electrical Installations
• Vehicles

AS PER WEBSITE :

Business Description

Syncom Healthcare Limited is an India-based pharmaceutical company. The Company is engaged in the business of manufacturing, marketing and distribution of pharmaceutical formulations under its own brands. The Company also undertakes contract manufacturing for various multinationals. The products of the Company are sold in over the counter (OTC), generic, ethical and herbal segments of domestic formulations market. As of March 31, 2010, the Company was selling its formulations through marketing network spread over 26 states through a chain of 50 distributors. Its plant is located at Dehradun in Uttarakhand. The Company’s products include tablet, capsules, dry powder, liquid orals, ointment and vial/drops. During the fiscal year ended March 31, 2010 (fiscal 2010), the Company produced 398,437,910 numbers of tablets; 24,764,590 numbers of capsules; 2,39,825 kilograms of dry powder; 1,51,794 kilograms of ointment, and 34,139 liters of vial/drops. For the nine months ended 31 December 2010, Subject’s revenues totaled RS581M. Net income totaled RS30.6M. Results are not comparable as the company has not reported its prior quarter figures. Syncom Healthcare limited is an India-based company. It is engaged in the manufacturing, marketing and Trading of pharmaceuticals formulations, wide range of ethical, over the counter, generic and herbals products.

Press Release

SYNCOM HEALTHCARE LIMITED TO SET UP SUBSIDIARY UNIT IN RAK FREE TRADE ZONE, DUBAI

Feb 07, 2011

Syncom Healthcare Limited announced that it is proposing to set up a subsidiary unit in RAK Free Trade Zone, Dubai as a free zone establishment for the purpose of trading of the pharmaceutical products and other commodities. For this, Company is proposing to have a flexi office for the time being and then to move for a standard office with the increase in the trading activities.

INDIA,UNITED ARAB EMIRATES : SYNCOM HEALTHCARE LTD SETS UP A SUBSIDIARY UNIT OF THE COMPANY IN RAK FREE TRADE ZONE, DUBAI

07 February 2011

Syncom Healthcare Limited* has informed BSE that the Company is proposing to set up a subsidiary unit in RAK Free Trade Zone, Dubai as a free zone establishment for the purpose of trading of the pharmaceutical products and other commodities.

For this, Company is proposing to have a flexi office for the time being and then to move for a standard office with the increase in the trading activities.

* Syncom Healthcare Limited is in the business of Healthcare since 45 years with the prime objective to mitigate human ailments.

Syncom Healthcare Limited was incorporated with an objective to manufacture and market pharmaceutical formulations. The Company is promoted by Shri Ajay S. Bankda, a renowned Indore based young entrepreneur.

He started his career with retailing of formulations and later on established a nationwide marketing chain with marketing of own brands like CTZ, FASTAC, Q-CORIL and many more. Capitalizing on the boom in pharmaceutical industry and with the aim to benefit from the tax incentives, a WHO - GMP compliant manufacturing facility in various dosage forms has been setup at Selaqui, near Dehradun in area measuring 4397 sq. mt. The facility is situated on Dehradun Chandigarh highway in the state of Uttaranchal. This region is absolutely free from noise, air and water pollution.

Our newly constructed formulations manufacturing facility is based on ultra Modern STATE OF ART TECHNOLOGY and has been designed by India s leading consultants Doshi Consultants Private Limited

BENCHMARKS PARE GAINS; SENSEX ABOVE 17,000 MARK

10 August 2011

India, Aug. 10 -- Indian equity indices are trading firm in a narrow rage but paring off some gains amid reports of fresh geo-political tensions fuming between South Korea and North Korea and owing to partial weakness in the European markets, but investors are not showing any kind of kneejerk reaction to the reports and are only focusing on hunting undervalued but fundamentally strong bargains. Market participant were seen piling up the positions in Auto, Realty and Consumer Durables while selling was witnessed in Oil and Gas and FMCG sector. Stocks like Warren Tea, Residency Project, Hindoostan Mills, Inventure Growth and Securities and Nitin Fire Protection hit new high while stocks like Cambridge Solutions, Euro Ceramics, Infinite Computers, Syncom Healthcare, Parle Software, GeeCee Ventures and SAL Steel hit new low. NTPC is trading firm after reports that the company is confident of achieving its target for the 12th Year Plan. NTPC has a capacity addition programme to get to about 66,000-70,000 MW by the end of 12th Year Plan. Fertilizers stocks were seen in action on expectation of some positive announcement. Stocks of fertilizers company like Chambal Fertilizers, National Fertilizers, RCF, Coromandel International and Gujarat State Fertilizers were seen trading firm. Last week there were reports that GoM approved draft policy on urea price decontrol. The Group of Ministers (GoM) on fertilizers headed by Finance Minister Pranab Mukherjee approved the draft policy which allows companies to increase the retail prices urea on the bases of market dynamics. The government on August 05 approved the decontrol of urea prices and allowed fertilizer companies to increase the rate of the important agriculture input prices by up to 10% in the first year of policy. Heavy activity was seen in counters of Manali Petrochemicals and Bharti Shipyard with heavy volumes due to fund based activity as of yesterday. Sidd Life Sciences bought 11,446,053 shares of Manali Petrochemicals while Southern Petrochemical Industries Corporation. Birla Sunlife Insurance Company sold 159,500 shares of Bharati Shipyard. Shares in Indian wind turbine maker Suzlon Energy were firm after the company received orders worth $107 million while Bharat Forge rose after it delivered an impressive June-quarter result. On the global front, Asian markets are trading in green barring Straits Times while the European markets were trading in mix on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 5,100 and 17,000 levels, respectively. The market breadth on the BSE was positive in the ratio of 2140:655 while, 79 scrips remained unchanged.The BSE Sensex is currently trading at 17,053.91 up by 196.00 points or 1.16% after trading as high as 17,256.46 and as low as 17,022.25. There were 23 stocks advancing against 7 declines on the index.The broader indices were trading on an optimistic note; the BSE Mid cap index surged 1.77% while Small cap jumped 2.23% respectively.� On the BSE sectoral space, Auto up 3.29%, Realty up 2.23%, Consumer Durables up 2.10%, Bankex up 2.02% and Capital Goods up 1.70% were the major gainers while Oil and Gas down by 0.57% and FMCG down 0.52% was the only loser on the index.Tata Motors up 5.51%, Maruti Suzuki up 4.32%, M and M up 3.94%, NTPC up 3.34% and DLF up 3.14% were major gainers on the Sensex, while ONGC down by 2.17%, HUL down 1.08%, Bharti Airtel down 0.96%, ITC down 0.78% and Sun Pharma down 0.65% were the major losers on the index.Meanwhile, the Ministry of Food Processing Industries (MFPI) has finalized its Vision 2015 Document, which is expected to reduce the wastage quotient in the processing of the perishable and it also aims to increase the size of the food processing sector by three times. The Minister of State, MFPI, Charan Das Mahant, said, the document envisage increasing the level of processing of perishables from 6% to 20%, value addition from 20% to 35% and share in global food trade from 1.5% to 3% by 2015.To minimize the wastage of fruit and vegetables, MFPI is encouraging the creation of cold chain facilities through a scheme for Cold Chain, Value Addition and Preservation Infrastructure coined in the 11th Five Year Plan. This was to give finance help to project proposals received from public and private organizations for cold chain infrastructure development. Charan Das Mahant said, the scheme envisaged financial assistance in the form of grant-in-aid at the rate of 50% of the total cost of plant and machinery and technical civil works in general areas and 75% for North Eastern Region and difficult areas subject to a maximum of Rs 10 crore. However, the minister did not provide any information on the effectiveness of the scheme. The private sector has been criticizing government for not having a clear policy or scheme for exponentially increasing the cold storage infrastructure in the country. The contribution of agriculture to India's GDP at the time of Independence was 70% and it accounted for 85% of total employment. The share of agriculture in the country's GDP has been gradually declining since then. At present, the contribution of agriculture to GDP is about 25%, but it still engages about 70% of the population. The annual average rate of growth of agricultural GDP has also declined from around 3.5% during mid-eighties to mere 1.5 % during 2006-07. It is estimated that if the country has to maintain a GDP growth rate of over 8%, the agricultural sector has to grow at the rate of at least 4%. The country has a huge potential for growth in agriculture with about 160 million hectares of arable land and diverse agro climatic conditions, suitable for cultivation of a wide variety of crops.India currently produces about 50 million tonnes of fruits, which is about 9% of the world's production of fruits and 90 million tonnes of vegetables, which accounts for 11% of the world's vegetable production. Though India has a strong raw material base, it has been unable to tap the potential for processing and value addition in perishables like fruits and vegetables. Only about 2% of the fruits and vegetables in India are processed, which is much lower when compared to countries like USA (65 %), Philippines (78%) and China (23%).� The SandP CNX Nifty is currently trading at 5,132.40, higher by 59.55 points or 1.17% after trading as high as 5,197.95 and as low as 5,132.40. There were 37 stocks advancing against 13 declines on the index.The top gainers of the Nifty were Tata Motors up 5.66%, MandM up by 4.17%, Maruti Suzuki up 3.88%, NTPC up 3.58% and DLF up 3.34%.Grasim down 2.10%, ONGC down 1.93%, Cairn down 1.65%, Bharti Airtel down 1.10% and HUL down 1.03% were the major losers on the index.Asian markets traded on a positive note, Shanghai Composite added 0.91%, Hang Seng surged 2.34%, Jakarta Composite soared 3.05%, KLSE Composite rose 0.57%, Nikkei 225 gained 1.05%, Seoul Composite rose 0.27% and Taiwan Weighted rallied 3.25%. On the other hand, Straits Times sank 1.69%. The European markets were trading in mix with, France's CAC 40 down 0.02%, Germany's DAX gained 1.15% and London'sFTSE rose 0.21%. Published by HT Syndication with permission from Accord Fintech.

BENCHMARKS DRIFT LOWER; NIFTY BELOW 5,400 MARK

04 August 2011

[What follows is the full text of the news story.]

India, Aug. 04 -- Indian equity indices drifted lower hovering around the lowest point of the day trading weak with a negative bias amid deepening concerns over the domestic market outlook at a time when financial markets across the globe have shunned the pessimism. Investors turned cautious and started booking profit on the frontline counters after the weekly inflation data released by the commerce ministry which shows that India's wholesale food prices rose by 8.04% year-on-year in the week ended July 23, 2011, faster than the 7.33% year-on-year inflation recorded in the week ended July 16. Market participants were seen selling in Auto, Realty and Metal sectors. Stocks like Warren Tea, Som Distillery, Gujarat Pipavav, Aanjaneya Lifecare and PFL Infotech hit new high while stocks like FCS Software, Cambridge Solutions, Anus Lab, Syncom Healthcare, DEN Networks, Indosolar, Cantabil Retail and Surana Venture hit new low. Also shares of Jet Airways and Godrej Properties were trading firm on news that Jet has concluded the much-awaited deal with Godrej Properties (GPL) to jointly develop a 2.5 acre land at Bandra-Kurla-Complex that Jet owns. The biggest private airlines will get Rs 500 crore in addition to 30,000 sq ft of built-up space in the development planned by Godrej Properties. Heavy activity was seen in counters of Henkel India, IVRCL, Vardhman Textiles, Greaves Cotton, Dalmia Bharat Sugar and Industries and ABG Shipyard with heavy volumes due to fund based activity as of yesterday. LRSD Global Holdings bought 598,082 shares of Henkel India, Barclays Capital Mauritius bought 1,405,806 shares of IVRCL, Reliance Mutual Fund sold 1,692,421 shares of Vardhman Textiles however, SBI Mutual Fund bought 1,679,376 shares, SBI MF-Scheme144 sold 3,260,684 shares of Greaves Cotton, Dharti Investment and Holdings sold 1,696,000 shares of Dalmia Bharat Sugar and Industries and Aashirwad Vincom bought 500,000 shares of ABG Shipyard. On the global front, Asian markets are trading in red barring Shanghai Composite, KLSE Composite and Nikkei 225 while the European markets too were trading mix. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 5,400 and 17,800 levels, respectively. The market breadth on the BSE was negative in the ratio of 1271:1433 while, 117 scrips remained unchanged.Moreover, B L Kashyap and Sons were seen trading at the lower circuit on reports that the Employees' Provident Fund Organisation has asked the company to pay Rs 593 crore in provident fund dues and penalty by 15 August 2011. According to reports, B L Kashyap and Sons has been charged with carrying out the country's biggest provident fund (PF) evasion. The Employees' Provident Fund Organisation (EPFO) has reportedly warned that if the company fails to pay up Rs 593 crore in provident fund dues and penalty by 15 August 2011, recovery proceedings will be initiated against it for evasion of workers' PF payments from April 2005 to December 2010. Further, reports suggested that the country's retirement fund regulator has also filed a police complaint against top officials of the company for forging employee muster rolls and submitting fake records, after a forensic analysis revealed the same thumb impression had been put against the records of several employees while shares of GTL and GTL Infrastructure were trading firm on reports that the company is planning to sell assets amid a proposal to revamp their debt.The BSE Sensex is currently trading at 17,762.02 down by 178.53 points or 1.00% after trading as high as 18,032.55 and as low as 17,756.54. There were 5 stocks advancing against 25 declines on the index.The broader indices were trading on negative note; the BSE Mid cap index lost 0.39% while Small cap was down by 0.07% respectively.� On the BSE sectoral space, there were no gainers while Auto down 1.62%, Realty down 1.51%, Metal down 1.47%, FMCG down 1.17% and Power down 1.16% were the top losers on the index.The top gainers on the Sensex were Reliance Infra up 1.86%, RCOM up 1.32%, Hero Honda up 0.31%, Infosys up 0.11% and HDFC up 0.04%.On the flip side, MandM down by 3.57%, NTPC down 2.70%, ITC down 2.40%, Hindaclo down 2.17% and Bajaj Auto down 1.80% were the major losers on the index.Meanwhile, after three week's successive fall in India's food inflation measured by Wholesale Price Index (WPI) has surged to 8.04% for the week ended July 23 from 7.33% in the last week. The food inflation for week ended July 16 had touched its 20 month low level. This surge in weekly food inflation is due to the increase in prices of food items such as vegetables, wheat, rice, onion, fruits milk and cereals. However, prices of pulses and potato saw moderation compared to last week. According to data released by ministry of commerce and industry, the index for 'Food Articles' group, which accounts for 14.34% of WPI, declined by 0.6% to 192.2 (Provisional) from 193.3 (Provisional) for the previous week due to lower prices of fish-marine, poultry chicken and urad (3% each), fruits and vegetables (2%) and egg, condiments and spices, arhar and pork (1% each).� However, the prices of fish-inland, moong and jowar (2% each) and gram, maize, tea, barley and bajra (1% each) moved up. However, the index for 'Non-Food Articles' group, which accounts for 4.26% of WPI, declined by 0.9% to 174.9 (Provisional) from 176.4 (Provisional) for the previous week due to lower prices of flowers (18%), raw cotton, niger seed and gingelly seed (3% each) and soyabean (1%).� However, the prices of gaur seed (11%), raw silk (6 %), copra (3%), castor seed and cotton seed (2% each) and groundnut seed, rape and mustard seed and sunflower (1% each) moved up. Therefore, the index for Primary Articles group, which accounts for 20.12% WPI, declined by 0.6% to 196.9 (Provisional) from 198.0 (Provisional) for the previous week. The annual rate of inflation, calculated on point to point basis, stood at 10.99% (Provisional) for the week ended July 23 as compared to 10.49% (Provisional) for the previous week July 16. Meanwhile, the index for fuel and power group, which accounts for 14.91% of WPI, remained unchanged at their previous week's level of 165.6 (Provisional). The annual rate of inflation, calculated on point to point basis, stood at 12.12% (Provisional) for the week ended July 23.Recently, the government removed ban over the export of non-basmati rice and wheat, this announcement has affected the domestic prices of these food grains. The RBI in its Economic Outlook for 2011-12 released earlier this week, the Prime Minister's Economic Advisory Council projected headline inflation to remain high at around 9% till October. The rate of price rise will ease from November, declining to around 6.5% by March 2012, it said. The report also said that while pressure from food inflation has fallen in recent months, the rate of price rice still remained quite high with the possibility of further surge in the coming months. The recent surge in the food inflation comes in line with the government's expectation, which on the other hand is facing charges from the opposition over the issue of food inflation.The SandP CNX Nifty is currently trading at 5,350.40, lower by 54.40 points or 1.01% after trading as high as 5,434.50 and as low as 5,349.70. There were 5 stocks advancing against 45 declines on the index.The top gainers of the Nifty were BPCL up 3.04%, Reliance Infra up by 1.97%, GAIL up 1.68%, RCOM up 0.96% and Hero Honda up 0.50%. On the flip side, MandM down 3.27%, Reliance Capital down 2.93%, NTPC down 2.81%, ITC down 2.71% and Sun Pharma down 2.58% were the major losers on the index.Asian markets traded on a mixed note, Shanghai Composite added 0.21%, KLSE Composite rose 0.12% and Nikkei 225 gained 0.23%. On the other hand, Hang Seng declined 0.49%, Jakarta Composite shed 0.71%, Straits Times sank 0.74%, Seoul Composite got clobbered by 2.31% and Taiwan Weighted plummeted 1.65%.The European markets were too trading in mix with, France's CAC 40 surged 0.49%, Germany's DAX soared 0.78% and London'sFTSE declined 0.11%. Published by HT Syndication with permission from Accord Fintech

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. 49.22
UK Pound	1	Rs. 76.06
Euro	1	Rs. 65.06

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	NO
--LISTED	YES/NO	YES
--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.