MIRA INFORM REPORT

Report Date :

18.10.2011

IDENTIFICATION DETAILS

Name :	VARDHMAN YARNS AND THREADS LIMITED
Registered Office :	Vardhman Premises, Chandigarh Road, Ludhiana – 141 010, Punjab
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	04.02.2005
Com. Reg. No.:	16-027936
Capital Investment / Paid-up Capital :	Rs.570.064 millions
CIN No.: [Company Identification No.]	U17230PB2005PLC027936
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Subject is engaged in the business of manufacturing and supply threads.
No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

Ba (51)

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Maximum Credit Limit :	USD 13022000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established and a reputed company having good track. Financial position of the company appears to be sound. Trade relations are reported as fair. Business is active. Payments are reported to be regular and as per commitments. The company can be considered good for normal business dealings at usual trade terms and conditions.

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

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 :	Vardhman Premises, Chandigarh Road, Ludhiana – 141 010, Punjab, India
Tel. No.:	91-161-2228943 - 48
Fax No.:	91-161-2601048/ 2602710
E-Mail :	sjindal@vardhman.com kwalia@vardhman.com
Website :	www.vardhman.in
Factory 1 :	Phagwara Road, Hoshiarpur, Punjab, India
Factory 2 :	Phase VIII, Focal Point, Ludhiana, Punjab, India
Factory 3 :	Plot No. E-13 and H-IO, SIPCOT Industrial Growth Centre, P.V. Palayam (P.O.), Perundurai, District Erode, Tamilnadu, India
Factory 4 :	Sai Road, Baddi, Tehsil Nalagarh, District Solan, Himachal Pradesh, India
Sales and Services :	Located at: Ahmedabad Bangalore Chennai Delhi Ernakulam Gurgaon Hyderabad Indore Jaipur Kanpur Kolkata Ludhiana Mumbai Noida Patna Pune Tirupur

SOLE PROPRIETOR/PARTNERS/DIRECTORS

As on 01.06.2011

Name :

Mr. Shri Paul Oswal

Designation :

Director

Address :

Auro Mirra Bhawan, 2722, Gurdev Nagar, Pakhowal Road, Ludhiana – 141 001, Punjab, India

Date of Birth/Age :

08.04.1942

Date of Appointment :

04.02.2005

DIN No.:

00121737

Other Directorship:

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	L17111PB1962PLC002463	Vardhman Holdings Limited	Director	12-04-71	12-04-71	-	Active	NO
2	L17111PB1973PLC003345	Vardhman Textiles Limited	Managing director	01-06-10	08-10-73	-	Active	NO
3	L33302CH1977PLC003719	Khanna Watches Limited	Director	26-07-77	26-07-77	16-03-09	Active	NO
4	L51491PB1990PLC019212	Vardhman Acrylics Limited	Director	24-12-90	24-12-90	-	Active	NO
5	L65921PB1982PLC024886	Santon Finance And Investment Company Limited	Director	20-04-93	20-04-93	-	Active	NO
6	L65921PB1982PLC024888	Flamingo Finance And Investment Company Limited	Director	20-04-93	20-04-93	-	Active	NO
7	U67120PB1980PTC022317	Devakar Investment And Trading Company Pvt Ltd	Director	20-04-93	20-04-93	-	Active	NO
8	U17117PB1990PLC014070	VMT Spinning Company Limited	Director	30-12-93	30-12-93	-	Active	NO
9	U17231PB1994PLC014256	VTL Investments Limited	Director	23-02-94	23-02-94	-	Active	NO
10	U67120PB1988PTC021770	Syracuse Investment And Trading Company Private Limited	Director	01-12-97	01-12-97	-	Active	NO
11	U67120PB1987PTC021772	Marshall Investment And Trading Company Private Limited	Director	15-12-97	15-12-97	-	Active	NO
12	U51494PB1987PTC007399	Pradeep Mercantile Company Private Limited	Director	16-12-97	16-12-97	-	Active	NO
13	U51909PB1987PTC007397	Plaza Trading Company Private Limited	Director	16-12-97	16-12-97	-	Active	NO
14	U67120PB1981PTC004749	Anklesh Investments Private Limited	Director	16-12-97	16-12-97	-	Active	NO
15	U45202PB1978PTC003831	Mahavir Spinning Mills Private Limited	Director	08-01-98	08-01-98	-	Active	NO
16	U67120PB1981PLC004492	Srestha Holdings Limited	Director	08-01-98	08-01-98	-	Active	NO
17	U67120PB1978ULT021891	Adinath Investment And Trading Company (Private Company With Unlimited Liability )	Director	23-10-98	23-10-98	-	Active	NO
18	L65921PB1983PLC024887	Ramaniya Finance And Investment Company Limited	Director	09-01-02	09-01-02	-	Active	NO
19	U00000PB2004PLC026873	Nimbua Greenfield (Punjab) Limited	Director	01-03-04	01-03-04	-	Active	NO
20	U17120MH1967PLC013669	Confederation Of Indian Textile Industry	Director	22-09-04	22-09-04	25-09-08	Active	NO
21	U17230PB2005PLC027936	Vardhman Yarns and Threads Limited	Director	07-04-08	04-02-05	-	Active	NO
22	U65991MH2002GOI137868	UTI Trustee Company Private Limited	Director	13-01-06	13-01-06	-	Active	NO
23	U17121PB2007PLC030853	Vardhman Spinning And General Mills Limited	Director	31-01-07	31-01-07	-	Active	NO
24	U18100PB2009PLC032764	Vardhman Nisshinbo Garments Company Limited	Director	17-04-09	17-04-09	20-08-09	Active	NO

Name :

Mr. Sachit Jain

Designation :

Director

Address :

Auro Mirra Bhawan, 2722, Gurdev Nagar, Pakhowal Road, Ludhiana – 141 001, Punjab, India

Date of Birth/Age :

08.07.1966

Date of Appointment :

04.02.2005

DIN No.:

00746409

Other Directorship:

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	L17111PB1973PLC003345	Vardhman Textiles Limited	Whole-time director	30-03-10	13-06-94	-	Active	NO
2	L51491PB1990PLC019212	Vardhman Acrylics Limited	Director	30-12-95	30-12-95	-	Active	NO
3	U51494PB1987PTC007399	Pradeep Mercantile Company Private Limited	Director	16-12-97	16-12-97	-	Active	NO
4	U51909PB1987PTC007397	Plaza Trading Company Private Limited	Director	16-12-97	16-12-97	-	Active	NO
5	U67120PB1981PTC004749	Anklesh Investments Private Limited	Director	16-12-97	16-12-97	-	Active	NO
6	U45202PB1978PTC003831	Mahavir Spinning Mills Private Limited	Director	08-01-98	08-01-98	-	Active	NO
7	U67120PB1980PTC022317	Devakar Investment And Trading Company Private Limited	Director	08-01-98	08-01-98	-	Active	NO
8	U67120PB1978ULT021891	Adinath Investment And Trading Company (Private Company With Unlimited Liability )	Director	23-10-98	23-10-98	-	Active	NO
9	U67120PB1988PTC021770	Syracuse Investment And Trading Company Private limited	Director	19-04-02	19-04-02	-	Active	NO
10	U67120PB1987PTC021772	Marshall Investment And Trading Company Private Limited	Director	16-07-02	16-07-02	-	Active	NO
11	L65921PB1983PLC024887	Ramaniya Finance And Investment Company Limited	Director	30-09-02	30-09-02	-	Active	NO
12	U67120PB1981PLC004492	Srestha Holdings Limited	Director	30-09-02	30-09-02	-	Active	NO
13	L65921PB1982PLC024886	Santon Finance And Investment Company Limited	Director	30-09-02	30-09-02	-	Active	NO
14	L65921PB1982PLC024888	Flamingo Finance And Investment Company Limited	Director	30-09-02	30-09-02	-	Active	NO
15	U17117PB1990PLC014070	VMT Spinning Company Limited	Whole-time director	01-05-08	17-04-03	14-03-11	Active	NO
16	U18100PB2003PLC026315	Vardhman Apparels Limited	Director	28-08-03	28-08-03	-	Active	NO
17	U17230PB2005PLC027936	Vardhman Yarns and Threads Limited	Director	04-02-05	04-02-05	-	Active	NO
18	L17111PB1962PLC002463	Vardhman Holdings Limited	Director	30-03-05	30-03-05	-	Active	NO
19	L29211PB1970PLC002942	Punjab Tractors Limited	Additional director	19-10-06	19-10-06	10-05-07	Amalgamated	NO
20	U17121PB2007PLC030853	Vardhman Spinning And General Mills Limited	Director	31-01-07	31-01-07	-	Active	NO
21	U17231PB1994PLC014256	VTL Investments Limited	Director	06-09-08	05-07-08	-	Active	NO
22	U18100PB2009PLC032764	Vardhman Nisshinbo Garments Company Limited	Director	20-08-09	17-04-09	-	Active	NO
23	U65991MH2002GOI137867	UTI Asset Management Company Limited	Director	20-01-10	20-01-10	-	Active	NO
24	U27100PB2010PLC033930	Vardhman Special Steels Limited	Managing director	01-04-11	14-05-10	-	Active	NO

Name :

Mr. Darshan Lal Sharma

Designation :

Managing Director

Address :

B – XX – 770/ 2, Gurdev Nagar, Pakhowal Road, Ludhiana – 141 001, Punjab, India

Date of Birth/Age :

10.11.1948

Qualification :

M.B.A.

Experience :

37 Years

Date of Appointment :

24.02.2005

DIN No.:

00727581

Other Directorship:

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	L17111PB1973PLC003345	Vardhman Textiles Limited	Whole-time director	01-04-08	08-05-85	-	Active	NO
2	L51491PB1990PLC019212	Vardhman Acrylics Limited	Director	24-12-90	24-12-90	-	Active	NO
3	U17121PB1983PLC005432	Deluxe Fabrics Limited	Director	20-08-93	20-08-93	-	Active	YES
4	U17117PB1990PLC014070	VMT Spinning Company Limited	Director	30-12-93	30-12-93	-	Active	NO
5	U17231PB1994PLC014256	VTL Investments Limited	Director	23-02-94	23-02-94	-	Active	NO
6	U17121PB1996PTC017569	Sangam Weavers Private Limited	Director	06-12-97	06-12-97	-	Active	NO
7	U17230PB2005PLC027936	Vardhman Yarns and Threads Limited	Managing director	01-04-11	24-02-05	-	Active	NO
8	U85110CH2007PTC030750	Arcs India Dialysis Centers Private Limited	Director	23-03-07	23-03-07	-	Active	NO
9	U18100PB2009PLC032764	Vardhman Nisshinbo Garments Company Limited	Whole-time director	01-02-11	17-04-09	-	Active	NO

Name :

Mr. John Leslie Miller

Designation :

Director

Address :

3628, Raintree Drive, Gastonia NC 28058

Date of Birth/Age :

17.04.1954

Date of Appointment :

07.04.2008

DIN No.:

02133277

Name :

Mr. Craig George Stover

Designation :

Director

Address :

1261, Lochshire Lane, Gastonia NC 28054

Date of Birth/Age :

26.10.1957

Date of Appointment :

07.04.2008

DIN No.:

02133405

Name :

Mr. Freddy Alfred Jackson

Designation :

Director

Address :

3671, Sherwood Circle, Gastonia NC 28056

Date of Birth/Age :

07.12.1949

Date of Appointment :

07.04.2008

DIN No.:

02133432

KEY EXECUTIVES

Name :	Mr. Walia Kamal Karan
Designation :	Secretary
Address :	708/4, Punjab Mata Nagar, Pakhowal Road, Ludhiana - 141013, Punjab, India
Date of Birth/Age :	05.07.1987
Date of Appointment :	28.04.11

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 01.06.2011

Names of Shareholders	No. of Shares
Vardhman Textiles Limited, India	29072180
Shri Paul Oswal	10
Darshan Lal Sharma	10
Sachit Jain	10
Neeraj Jain	10
Rajeev Thapar	10
Mahesh Arora	10
Adinath Investment and Trading Company Limited, India	1000
American and Efird Inc., USA	27933114
Total	57006354

Equity Share Break up (Percentage of Total Equity) 01.06.2011

Category	Percentage
Foreign holdings( Foreign institutional investor(s), Foreign companie(s) Foreign financial institution(s), Non-resident Indian(s) or Overseas Corporate bodies or Others	49.00
Bodies corporate	51.00
Total	100.00

BUSINESS DETAILS

Line of Business :

Subject is engaged in the business of manufacturing and supply threads.

Products :

Product Description	Item Code No.
Cotton Thread	52041140
Polyester Thread	55081000
Nylon/ Syn. Filament/ Core Spun Thread	54011000
Man Made Filaments of Polyester (Braid Thread)	54026200

PRODUCTION STATUS (AS ON 31.03.2010)

Particulars	Unit	Installed Capacity
Threads	MT	12000

Particulars	Unit	Actual Production
Sewing Thread	MT	10402

GENERAL INFORMATION

No. of Employees :

Not Available

Bankers :

• State Bank of Patiala, Commercial Branch, Ludhiana – 141 003, Punjab, India
• ICICI Bank Limited, Landmark Race Cource Circle, Alkapuri, Baroda – 390015, Gujarat, India
• Corporation Bank, SCO – 34, Feroze Gandhi Market, Ludhiana – 141001, Punjab, India

Facilities :

Secured Loans	31.03.2010 Rs. In Millions	31.03.2009 Rs. In Millions
Loans and advances from Banks - Term loans *	696.305	641.762
- Working Capital Borrowings **	10.276	36.625
Total	706.581	678.387

* The term loans from banks are secured by mortgage created or to be created on all immovable assets of the Company , both present and future; and hypothecation of all the movable assets both present and future (except book debts), subject to charges created or to be created in favour of the bankers for securing the working capital limits.

* Includes Rs.78.814 millions (previous year Rs.70.457 millions) filling due for payment within one year

** Working capital borrowings from banks are secured by hypothecation of entire present and future movable assets of the Company

Banking Relations :	--
Auditors :
Name :	Walker, Chandiok and Company Chartered Accountants
Address :	L 41, Connaught Circus, New Delhi – 110 001, India
Tel. No.:	91-11-42787070
Fax No.:	91-11-42787071
E-Mail :	NEWDELHI@wcgt.in
PAN.:	AAAFW4298E
Holding Company :	Vardhman Textiles Limited, India CIN No.: L17111PB1973PLC003345
Company which exercise significant influence :	American and Efird Inc., USA
Fellow Subsidiary Companies :	v Vardhman Acrylics Limited v VMT Spinning Company Limited

CAPITAL STRUCTURE

As on 30.09.2011

Authorised Capital:

No. of Shares	Type	Value	Amount
60000000	Equity Shares	Rs.10/- each	Rs.600.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
57006354	Equity Shares	Rs.10/- each	Rs.570.064 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		570.064	570.064	0.510
2] Equity Share Capital pending allotments pursuant to the Scheme of ‘Arrangement and Demerger’		0.000	0.000	40.000
3] Reserves & Surplus		2685.375	2400.363	157.918
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		3255.439	2970.427	198.428
LOAN FUNDS
1] Secured Loans		706.581	678.387	87.935
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		706.581	678.387	87.935
DEFERRED TAX LIABILITIES		37.409	26.266	6.777
TOTAL		3999.429	3675.080	293.140
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		1794.396	1766.280	97.563
Capital work-in-progress (including capital advances)		18.056	51.864	0.522
Intangible Assets		225.977	254.224	0.000
INVESTMENT		8.471	8.471	0.010
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	986.979	741.564	43.213
	Sundry Debtors	685.397	637.579	48.651
	Cash & Bank Balances	340.797	122.701	40.822
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	443.152	520.086	77.532
Total Current Assets		2456.325	2021.930	210.218
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	321.369	263.836	11.196
	Other Current Liabilities	31.704	45.075	2.807
	Provisions	150.723	118.778	1.170
Total Current Liabilities		503.796	427.689	15.173
Net Current Assets		1952.529	1594.241	195.045
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		3999.429	3675.080	293.140

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Net Sales	3771.510	3365.398	238.440
		Other Income	43.270	26.329	56.478
		TOTAL (A)	3814.780	3391.727	294.918
Less	EXPENSES
		Raw Material Consumed	1130.145	961.130	114.383
		Manufacturing Expenses	1159.355	980.042	57.354
		Personnel Expenses	390.574	358.713	21.766
		Administrative and Other Expenses	154.592	144.398	11.462
		Selling and Distribution Expenses	190.637	162.347	7.949
		(Increase)/ Decrease in Work in process Finished Goods	(39.318)	64.510	3.556
		TOTAL (B)	2985.985	2671.140	216.470
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		828.795	720.587	78.448
Less	INTEREST & FINANCIAL EXPENSES (D)		27.211	36.100	2.166
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		801.584	684.487	76.282
Less/ Add	DEPRECIATION/ AMORTISATION (F)		195.492	201.804	10.916
	PROFIT BEFORE TAX (E-F) (G)		606.092	482.683	65.366
Less	TAX (H)		192.503	145.465	2.238
	PROFIT AFTER TAX (G-H) (I)		413.589	337.218	63.128
Less	Prior period items		0.282	0.366	0.736
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		172.371	62.230	(0.162)
Less	APPROPRIATIONS
		Proposed Dividend
		- On Equity Shares	110.022	91.210	0.000
		- Corporate dividend tax thereon	18.273	15.501	0.000
		Transferred to General Reserve	150.000	120.000	0.000
	BALANCE CARRIED TO THE B/S		307.383	172.371	62.230
	EARNINGS IN FOREIGN CURRENCY
		FOB amount of Exports	178.351	159.926	20.688
	TOTAL EARNINGS		178.351	159.926	20.688
	IMPORTS
		Raw Materials	132.022	65.995	17.494
		Components and Spare Parts	40.856	18.677	2.395
		Capital Goods	50.843	17.297	2.816
	TOTAL IMPORTS		223.721	101.969	22.705
	Earnings Per Share (Rs.)		7.25	6.02	15.40

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	10.84	9.94	21.41
Net Profit Margin (PBT/Sales)	(%)	16.07	14.34	27.41
Return on Total Assets (PBT/Total Assets}	(%)	14.26	12.74	21.24
Return on Investment (ROI) (PBT/Networth)		0.19	0.16	0.33
Debt Equity Ratio (Total Liability/Networth)		0.97	0.37	0.52
Current Ratio (Current Asset/Current Liability)		4.88	4.73	13.85

LOCAL AGENCY FURTHER INFORMATION

BACKGROUND AND NATURE OF OPERATIONS

The Company incorporated in February 2005, under the Companies Act 1956 is engaged in the business of manufacturing and supply threads. Currently, the Company has four manufacturing facilities, at Ludhiana (Punjab)-thread manufacturing, Hoshiarpur (Punjab)-spinning and thread manufacturing, Baddi (Himachal Pradesh) thread manufacturing and Perundurai (Tamilnadu) thread manufacturing.

FINANCIAL RESULTS:

During the year, the gross sales of the Company were Rs.3771.626 millions as against Rs.3365.516 millions in the previous year, registering an increase of 12.07 percent. The net profit increased from Rs.337.218 millions in the previous year to Rs.413.589 millions during the year, showing an increase of 22.65 percent. The production of sewing thread during the year was 10,679 MT as compared to 9,759 MT in the previous year. The FOB value of exports of the Company during the year was Rs.178.351 millions as against Rs.159.926 millions in the previous year, registering an increase of 11.52 percent.

BUSINESS SCENARIO:

The economic situation started showing signs of improvement in the second half of the last fiscal year which resulted in the improvement of the growth rate of the manufacturing sector. The textile industry also witnessed surge in the capacity utilization across the entire value chain.

The export performance of the clothing’s, home textiles and leather goods witnessed growth trends in line with the improved retail off-take in the US and European Markets. Consumer demand in the domestic market also improved and supported the positive growth in the company's sales revenue in both industrial and consumer segments.

The business outlook is expected to be positive with opportunities for growth due to expectation of higher consumer demand, both in the domestic and international markets. In addition, the international buyers prefer to source high value added merchandises in small lots requiring quick changes in fashion with embellishments etc. from India as the Apparel manufacturers have developed special skills and capabilities to meet such requirements.

However, the market conditions remain difficult due to intense competition and increasing inflation rate and its consequences on the interest rates. The prices of major raw materials like cotton and polyester and other input costs have witnessed significant increases. The manufacturing cost relating to energy and wages are expected to go up because of the inflationary tendencies.

The stimulant packages extended by the Government to counter the slow down during the last year are being withdrawn gradually resulting into further cost push. As a result, the operating margins have come under pressure due to increasing factor costs and competitive business environment. The company shall continue to focus in the direction of improving resource productivity and offering quality products by meeting the ever-increasing challenges of on - time deliveries and superior customer’s services.

EXPANSION:

During the year, the expansion in the spindlage capacity of the unit at Hoshiarpur was completed by addition of 10,080 spindles. The Company is also taking steps to rationalize its capacities to meet the future challenges of growth in demand and product-mix.

The Scheme of Arrangement, Re-organization and Demerger (the Scheme) filed under Section 391-394 of the Companies Act, 1956 amongst the Company and Vardhman Textiles Limited (VTXL), Vardhman Threads Limited

(VTL) and their respective shareholders and creditors was approved by the Hon'ble High Court of Haryana and Punjab vide order dated January 24, 2008; the effect of which has been taken by the Company in the previous year financials.

Notes:

The scheme of arrangement re-organizations and Demerger filed under Section 391 -394 of the Companies Act, 1956 amongst the company and Vardhman Textiles Limited, Vardhman Threads Limited and their respective shareholder and creditors was approved by the Hon’ble High Court of Haryana and Punjab vide order dated January 24, 2008 the effect of which has been taken by the company in the previous year financial.

FORM 8:

Corporate identity number of the company	U17230PB2005PLC027936
Name of the company	VARDHMAN YARNS AND THREADS LIMITED
Address of the registered office or of the principal place of business in India of the company	Vardhman Premises, Chandigarh Road, Ludhiana – 141 010, Punjab, India Email : kwalia@vardhman.com
This form is for	Creation of charge
Type of charge	Immovable Property Book Debts Movable Property (not being pledge)
Particular of charge holder	State Bank of Patiala, Commercial Branch, Ludhiana – 141001, Punjab, India Email: sbop50463@gmail.com
Nature of instrument creating charge	1) First Pari Passu charge on the entire Fixed Assets of the Company, present as well as future with other term lenders. 2) Second Pari Passu charge on the entire Current Assets of the Company with other term lenders. (present and future)
Date of instrument Creating the charge	20.09.2011
Amount secured by the charge	Rs. 450.000 Millions
Brief of the principal terms an conditions and extent and operation of the charge	Rate of Interest : 2 % Above Basis Rate (FLOATING) p.a. with reset every 2 years from the date of sanction. Terms of Repayment: 20 graded quarterly installments commencing after two years from the date of first disbursement i.e. 31st July, 2013. -First 4 Installments of Rs. 2.000 millions each -Next 4 Installments of Rs. 4.000 millions each -Next 4 Installments of Rs 6.000 millions each. -Next 4 Installments of Rs. 8.000 millions each. -Last 4 Installments of Rs. 92.500 millions each. Margin: 33% Extent and operation of charge: 100%
Short particulars of the property or asset(s) charged (including complete address and location of the property)	All the piece and parcel of land admeasuring 278 kanal 03 marlas (approx) together with all the building and structures thereon, fixtures, fittings and all plant and machinery attached to the earth. Second Pari Passu charge on the entire Current Assets of the Company with other term lenders

CONTINGENCIES AND COMMITMENTS ARE AS FOLLOWS:
 

Particulars	31.03.2010 (Rs. in millions)
a. Bank guarantees given by the company	4.027
b. Claims against the Company not acknowledged as debts.	9.601

FIXED ASSETS:

Tangible Assets

v Freehold Land

v Leasehold Land

v Buildings

v Plant and Machinery

v Furniture and Fittings

v Vehicles

Intangible Assets

v Brands

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.48.89
UK Pound	1	Rs.77.31
Euro	1	Rs.67.79

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	4
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	6
--RESERVES	1~10	6
--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	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		51

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.