MIRA INFORM REPORT

Report Date :

07.09.2011

IDENTIFICATION DETAILS

Name :	MALU ELECTRODES PRIVATE LIMITED
Registered Office :	S-111, Ramkrishna Apartment, Schaprunagare, Square, Nagpur-440008, Maharashtra
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	05.09.1990
Com. Reg. No.:	11-58024
Capital Investment / Paid-up Capital :	Rs.105.000 Millions
CIN No.: [Company Identification No.]	U31200MH1990PTC058024
IEC No.:	0395058091
TAN No.: [Tax Deduction & Collection Account No.]	NGPM00629G
PAN No.: [Permanent Account No.]	AABCM2306H
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacturer of Welding Electrodes.
No. of Employees :	133 Approximately

RATING & COMMENTS

MIRA’s Rating :

Ba (48)

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

Maximum Credit Limit :	USD 1206668
Status :	Satisfactory
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is a well 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 – April 1, 2010

Country Name	Previous Rating (31.12.2009)	Current Rating (01.04.2010)
India	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

INFORMATION DECLINED BY

Name :	Mr. Sanjay Dhame
Designation :	Chief General Manager
Contact No.:	91-9881732172

LOCATIONS

Registered Office :	S-111, Ramkrishna Apartment, Schaprunagare, Square, Nagpur-440008, Maharashtra, India
Tel. No.:	91-712-2760873/ 2767121/ 2778931
Fax No.:	91-712-2761315
E-Mail :	pramalu@satym.net.in , info@prmalugroup.com
Website :	http://www.prmalugroup.com
Area :	1000 sq. ft ( Owned)
Corporate Office :	Neelkamal, 1249 Central Avenue, Nagpur – 440002, Maharashtra
Tel. No.:	91-712-2767121
Fax No.:	91-712-2761315
E-Mail :	info@prmalugroup.com
Website :	http://www.prmalugroup.com
Factory :	S/4, MIDC, Industrial Area, Hingan Road, Nagpur-440008, Mahararshtra, India
Area :	10000 sq. ft ( Owned)

DIRECTORS

AS ON 30.09.2010

Name :	Mr. Punamchand Ramlal Malu
Designation :	Director
Address :	1249, Neelkamal, Central Avenue, Nagpur – 440002, Maharashtra
Date of Birth/Age :	13.03.1952
Qualification :	B.Com
Date of Appointment :	09.09.1990
Date of Cessation:	01.07.2010
Name :	Mr. Shravan Ramlal Malu
Designation :	Director
Address :	1249, Neelkamal, Central Avenue, Nagpur – 440002, Maharashtra
Date of Birth/Age :	18.01.1960
Qualification :	B.Com
Name :	Mr. Raheshyam Malu
Designation :	Director
Address :	1249, Neelkamal, Central Avenue, Nagpur – 440002, Maharashtra
Date of Birth/Age :	23 Years
Qualification :	M.B.A
Name :	Mr. Venugopal Malu
Designation :	Director
Date of Birth/Age :	25.10.1980
Date of Appointment :	01.07.2010

KEY EXECUTIVES

Name :	Mr. Sanjay Dhame
Designation :	Chief General Manager

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 30.09.2010

Name of Shareholders	No. of Shares
Shrawankumar Ramlal Malu	875000
Punamchand Ramlal Malu	910000
Kaushalya Punamchand Malu	770000
Sushila Purshottam Malu	812000
Anita Shrawankumar Malu	745500
Pushpa Damodarlal Malu	805000
Ganpati Malu	17500
Damoderlal Malu	910000
Purshottam Ramlal Malu	945000
Purshottam Ramlal Malu - HUF	59500
Shrawankumar Ramlal Malu - HUF	59500
Punamchand Malu	56000
Damoderlal Malu - HUF	56000
Marigold Farms Private Limited, Nagpur, Maharashtra	910000
Venugopal Punamchand Malu	700000
Radhyeshyam P Malu	770000
Bharat S Malu	689500
Shalini V Malu	409500
Total	10500000

Equity Share Breakup (Percentage of Total Equity)

AS ON 30.09.2010

Category	Percentage
Bodies or relatives of directros	9.09
Directors or relatives of directors	90.91
Total	100.00

BUSINESS DETAILS

Line of Business :	Manufacturer of Welding Electrodes.
Exports :
Countries :	Ø Africa Ø North America Ø Gulf Countries Ø Europe
Imports :
Products :	Wire Rodes
Countries :	Ø Korea Ø China Ø Australia
Terms :
Selling :	L/C, Cash, Credit ( 15-45 Days) and T.T
Purchasing :	L/C, Cash , Credit (15 Days) and T.T

GENERAL INFORMATION

No. of Employees :

133 Approximately

Bankers :

Ø State Bank of India, Hingna

Ø Punjab National Bank

Ø Bank of Maharashtra

Ø ICICI Bank

Ø State Bank of India Central Avenue Road, [Nagpur] Branch.

Ø Axis Bank Limited, M G House, Rabindranath Tagore Road, Besides Board Office, Civil Lines, Nagapur-440001, Maharashtra, India

Facilities :

Particulars	Rs. In Millions 31.03.2010	Rs. In Millions 31.03.2009
Secured Loan
HDFC Bank Limited (Against Car)	3.253	0.724
Axis Bank Limited (Term Loan) (Against Pant and Machinery)	24.344	35.596
Axis Bank Limited (Cash Credit A/C) Secured against hypothecation of raw material, First Charge of Building and Machinery	114.263	133.643
Total	141.860	169.963
Unsecured Loan
Shareholders and Relatives	13.660	38.600
Total	13.660	38.600

Banking Relations :	--
Auditors :
Name :	Demble Ramani and Company Chartered Accountants
Address :	201, M G House, Civil Lines, Nagpur – 440001, Maharashtra, India
Tel. No.:	91-712-3918630 / 3918631
E-Mail :	deraco_nag@sancharnet.in
Associates/Subsidiaries :	Nil

CAPITAL STRUCTURE

AS ON 30.09.2010

Authorised Capital :

No. of Shares	Type	Value	Amount
15000000	Equity Shares	Rs.10/- each	Rs.150.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
10500000	Equity Shares	Rs.10/- each	Rs.105.000 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		105.000	14.300	14.300
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		196.667	95.293	45.767
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		301.667	109.593	60.067
LOAN FUNDS
1] Secured Loans		141.860	169.963	103.902
2] Unsecured Loans		13.660	38.600	19.560
TOTAL BORROWING		155.520	208.563	123.462
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		457.187	318.156	183.529
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		135.853	113.268	71.730
Capital work-in-progress		0.551	0.000	6.632
INVESTMENT		167.937	8.888	0.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	353.178	38.776	40.015
	Sundry Debtors	230.380	155.771	72.507
	Cash & Bank Balances	8.775	25.492	10.088
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	77.515	39.565	17.852
Total Current Assets		669.848	259.604	140.462
Less : CURRENT LIABILITIES & PROVISIONS
		481.264	53.395	20.563
	Current Liabilities	11.737	1.018	14.732
	Provisions	24.408	9.733	0.000
0.Total Current Liabilities		517.409	64.146	35.295
Net Current Assets		152.439	195.458	105.167
MISCELLANEOUS EXPENSES		0.407	0.544	0.000
TOTAL		457.187	318.156	183.529

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Sales	1898.317	1023.680	614.477
		Other Income	0.000	(0.174)	0.318
		TOTAL (A)	1898.317	1023.506	614.795
Less	EXPENSES
		Cost of Materials	1524.741	901.181	546.257
		Selling and Distribution Expenses	0.000	20.063	10.593
		Administrative Expenses	82.149	10.240	8.123
		TOTAL (B)	1606.890	931.484	564.973
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		291.427	92.022	49.822
Less	FINANCIAL EXPENSES (D)		23.909	22.162	15.627
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		267.518	69.860	34.195
Less/ Add	DEPRECIATION/ AMORTISATION (F)		6.211	4.389	3.861
	PROFIT BEFORE TAX (E-F) (G)		261.307	65.471	30.334
Less	TAX (H)		69.934	15.945	9.710
	PROFIT AFTER TAX (G-H) (I)		191.373	49.526	20.624
	Earnings Per Share (Rs.)		18.22	--	--

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	10.08	4.83	3.35
Net Profit Margin (PBT/Sales)	(%)	13.76	6.39	4.93
Return on Total Assets (PBT/Total Assets}	(%)	23.75	13.28	9.71
Return on Investment (ROI) (PBT/Networth)		0.86	0.59	0.50
Debt Equity Ratio (Total Liability/Networth)		2.23	2.48	2.64
Current Ratio (Current Asset/Current Liability)		1.29	4.04	3.97

LOCAL AGENCY FURTHER INFORMATION

Fixed Assets:

• Computers
• Electrical Equipments
• Furniture
• Land
• Machinery and plant
• Car
• Buildings

Trade References:

Ø K. K. Welding Limited, Mumbai

Ø Chandrakant Enterprises, Kolhapur, Maharashtra, India

Ø Arihant Industris Supply, Solapur, Maharashtra, India

Ø Redsea General Trading, Angola

Ø W.P.T. Wide Action Jay Limited, Hong Kong

Bankers Charges Report as per Registry

Corporate identity number of the company	U31200MH1990PTC058024
Name of the company	MALU ELECTRODES PRIVATE LIMITED
Address of the registered office or of the principal place of business in India of the company	S-111, Ramkrishna Apartment, Schaprunagare, Square, Nagpur-440008, Maharashtra, India
This form is for	Modification of charge
Type of charge	Movable property (not being pledge)
Particular of charge holder	Axis Bank Limited, M G House, Rabindranath Tagore Road, Besides Board Office, Civil Lines, Nagapur-440001, Maharashtra, India Email: sanjivkumar@axisbank.com
Nature of instrument creating charge	Supplemental Deed of Hypothecation Dated 23/10/2010
Date of instrument Creating the charge	23.10.2010
Amount secured by the charge	Rs. 606.100 millions
Brief of the principal terms an conditions and extent and operation of the charge	Rate of interest As Per The Terms And Conditions Of Vide Supplemental Deed Of Hypothecation Dated 23/10/2010 Terms of repayment As Per The Terms And Conditions Of Vide Supplemental Deed Of Hypothecation Dated 23/10/2010 Margin As Per The Terms And Conditions Of Vide Supplemental Deed Of Hypothecation Dated 23/10/2010 Extent and operation of the charge First And Exclusive Charge Over The Properties Hypothecated Vide Supplemental Deed Of Hypothecation Dated 23/10/2010
Short particulars of the property charged (Including location of the property)	Hypothecation Of Entire Current Assets And Movable Fixed Assets Of The Company Both Present and Future
Date of instrument modifying the charge	23.03.2010
Particulars of the present modification	By Way Of This Modification Additional Letter Of Credit Facility Of Rs. 150 millions Has Been Sanctioned Thus The Total Credit Facility Stand Modified To Rs. 606.100 millions

CMT REPORT (Corruption, Money Laundering and 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.46.12
UK Pound	1	Rs.74.18
Euro	1	Rs.64.87

SCORE and RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	5
--PROFITABILIRY	1~10	6
--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	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		48

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 and 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.