MIRA INFORM REPORT

Report Date :

20.09.2011

IDENTIFICATION DETAILS

Name :	SIMPSON AND COMPANY LIMITED
Registered Office :	861/862 Anna Salai, Tamil Nadu, Chennai-600002, India
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	03.02.1925
Com. Reg. No.:	18-002345
Capital Investment / Paid-up Capital :	75.000 Millions
CIN No.: [Company Identification No.]	U65991TN1925PLC002345
TAN No.: [Tax Deduction & Collection Account No.]	CHES00284E
Legal Form:	A closely held public limited liability company
Line of Business:	Subject is engaged in the business of Diesel engines and related components.
No. of Employees :	(Approximately)

RATING & COMMENTS

MIRA’s Rating :

A(65)

RATING		STATUS	PROPOSED CREDIT LINE
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large

Maximum Credit Limit :	USD 24000000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well – established company having fine 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 of 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

LOCATIONS

Registered Office :	861/862 Anna Salai, Tamil Nadu, Chennai-600002, India.
Tel. No.:	91-44-28584918
Telex.:	91-41-7038
Fax No.:	91-44-8584590
E-Mail :	marketing@simpson.co.in/ simpfin@md3.vsnl.net.in
Website:	http://www.simpsons.in
Regional Office :	Located at: · New Delhi · Mumbai · Kolkata
Branches :	Located at: · Bangalore · Hyderabad · Ooty · Tiruchirapalli

DIRECTORS

AS ON 29.09.2010

Name :

Mr. Anantharamakrishnan SivaSailam

Designation :

Director

Address :

Sudharma 128 Drradhakrishnan Salai, Mylapore, Chennai Tamil Nadu-600004

Date of Birth/Age :

24.08.1934

Date of Appointment :

17.05.1964

DIN No.:

00001592

Other Directorship:

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
U35999TN1938PTC000019	AMALGAMATIONS PRIVATE LIMITED	Director	06-05-64	06-05-64	12-01-11	Active	NO
U29129TN1960PLC004337	TRACTORS AND FARM EQUIPMENT LIMITED.	Managing director	13-05-10	13-05-64	12-01-11	Active	NO
U65991TN1925PLC002345	SIMPSON AND COMPANY LIMITED	Director	17-05-64	17-05-64	12-01-11	Active	NO
U31400TN1955PLC080755	AMCO BATTERIES LIMITED	Director	02-03-65	02-03-65	12-01-11	Active	NO
U35999TN1949PLC000951	INDIA PISTONS LIMITED	Director	09-09-66	09-09-66	12-01-11	Active	NO
L02421TZ1910PLC000221	T STANES AND COMPANY LIMITED	Director	22-11-66	22-11-66	12-01-11	Active	NO
L01132TZ1922PLC000234	THE UNITED NILGIRI TEA ESTATES COMPANY LIMITED	Director	24-12-66	24-12-66	12-01-11	Active	NO
U28939TN1914PLC000008	ADDISON & CO. LIMITED	Director	08-08-83	08-08-83	12-01-11	Active	NO
L28920TN1991PLC020232	IP RINGS LIMITED	Director	30-01-91	30-01-91	12-01-11	Active	NO
U15499TN1992PLC023544	TAFE ACCESS LIMITED	Director	28-09-92	28-09-92	12-01-11	Active	NO
U51909TN1994PLC026633	IP POWER CYLINDER SYSTEMS LIMITED	Director	12-12-94	12-12-94	-	Amalgamated	NO
U29130TN1997PTC037909	AMALGAMATIONS VALEO CLUTCH PRIVATE LIMITED	Director	07-04-97	07-04-97	12-01-11	Active	NO
U85110TN1997NPL037456	AHIMSAA RESEARCH FOUNDATION	Director	06-02-98	06-02-98	-	Active	NO
U65991TN1921NPL001337	CHENNAI WILLINGDON CORPORATE FOUNDATION	Director	06-09-99	06-09-99	12-01-11	Active	NO
U15491TZ2000PLC009309	STANES MJF TEAS LIMITED	Director	24-04-00	24-04-00	12-01-11	Active	NO
U34107TN2001PTC047925	STANADYNE AMALGAMATIONS PRIVATE LIMITED	Director	22-10-01	22-10-01	12-01-11	Active	NO
U34300TN2003PLC051919	TAL PRECISION PARTS LIMITED	Director	07-11-03	07-11-03	01-10-07	Active	NO
U85110KA1996PLC021517	AMCO SAFT INDIA LIMITED	Director	13-02-06	13-02-06	12-01-11	Active	NO
U29211TN2005PLC055476	TAFE MOTORS AND TRACTORS LIMITED	Director	11-09-06	11-09-06	12-01-11	Active	NO
U29130TN2007PLC064383	MAHLE IPL LIMITED	Director	04-08-07	04-08-07	12-01-11	Active	NO

Name :

Mr. Ananthramakrishnan Krishnamoorthy

Designation :

Managing Director

Address :

Kalyani Mahal, Drradhakrishnan Salai, Mylapore, Chennai Tamil Nadu-600004

Date of Birth/Age :

26.09.1937

Date of Appointment :

24.06.1971

DIN No.:

00001778

Other Directorship:

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
U35990TN1960PLC004235	SHARDLOW INDIA LIMITED	Director	07-05-64	07-05-64	-	Active	NO
U22110TN1950PTC000036	ASSOCIATED PRINTERS (MADRAS) PRIVATE LIMITED	Director	28-04-67	28-04-67	-	Active	NO
U35999TN1967PLC005566	AMALGAMATIONS REPCO LIMITED	Director	08-02-68	08-02-68	-	Active	NO
L02421TZ1910PLC000221	T STANES AND COMPANY LIMITED	Director	16-09-68	16-09-68	-	Active	NO
L29130TN1961PLC004466	BIMETAL BEARINGS LIMITED	Managing director	10-05-10	26-06-70	-	Active	NO
U35999TN1938PTC000019	AMALGAMATIONS PRIVATE LIMITED	Director	25-09-70	25-09-70	-	Active	NO
U65991TN1925PLC002345	SIMPSON AND COMPANY LIMITED	Managing director	15-06-11	24-06-71	-	Active	NO
L01132TZ1946PLC000180	STANES AMALGAMATED ESTATES LIMITED	Director	31-12-73	31-12-73	-	Active	NO
U35999TN1949PLC000951	INDIA PISTONS LIMITED	Director	18-11-81	18-11-81	-	Active	NO
U29130TN1997PTC037909	AMALGAMATIONS VALEO CLUTCH PRIVATE LIMITED	Director	07-04-97	07-04-97	-	Active	NO
U22121TN1925PTC000003	ASSOCIATED PUBLISHERS (MADRAS) PRIVATE LIMITED	Director	24-09-98	24-09-98	-	Active	NO
U15491TZ2000PLC009309	STANES MJF TEAS LIMITED	Director	24-04-00	24-04-00	-	Active	NO
U34300TN2001PTC048109	BBL DAIDO PRIVATE LIMITED	Director	17-04-02	17-04-02	-	Active	NO
U29130TN2007PLC064383	MAHLE IPL LIMITED	Director	04-08-07	04-08-07	07-02-08	Active	NO
U28939TN1914PLC000008	ADDISON & CO. LIMITED	Director	29-01-11	29-01-11	-	Active	NO

Name :

Mr. Janardhana Iyer sankaran

Designation :

Director

Address :

5 First Cross Street, West CIT Nagar, Chennai Tamil Nadu-600035

Date of Birth/Age :

17.08.1919

Date of Appointment :

20.10.1987

DIN No.:

00001793

Other Directorship:

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
U65190TN1938PLC002355	SIMPSON & GENERAL FINANCE COMPANY LIMITED	Director	14-03-64	14-03-64	-	Active	NO
U29214TN1938PLC002346	SRI RAMA VILAS SERVICE LIMITED	Director	30-08-76	30-08-76	28-07-11	Active	NO
U28939TN1914PLC000008	ADDISON & CO. LIMITED	Director	29-08-86	29-08-86	29-07-11	Active	NO
U65991TN1925PLC002345	SIMPSON AND COMPANY LIMITED	Director	20-10-87	20-10-87	-	Active	NO

KEY EXECUTIVES

AS ON 30.09.2010

Name :	Mr. SRIDHARAN SRINIVASARAGHAVAN
Designation :	Secretary
Address :	24, Veerasamy Street, West Mambalam, Chennai, Tamil Nadu-600033
Date of Birth/Age :	15.12.1950
Date of Appointment :	14.04.1997

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 30.09.2010

Names of Shareholders	No. of Shares
P.R. Shankar Kumar	2000
A. Sivasailam	34382
N. Sivasailam	2833
Purna Devi Gajapathi	1666
R. Saraswati	333
Zafar Abid Ebrahim	666
Lakshmi Narayan	17574
N. Sethu Venkataraman	2833
A.Krishnamoorthy	35653
Parvathi Madhavan	1000
New Ambadi Estates Private Limited, India	3333
Estate of Late, India	8333
R. Lakshmi	1333
United India Insurance Company Limited, India	20000
Sundharams Private Limited, India	1000
Sita Venkataramani	26438
The United Nilgiris Tea Estates Company, Coimbatore	26333
Sankara Krishnan	3333
A. Sivasailam	1500
Mallika Srinivasan	4276
Jayashree Venkatraman	2444

Equity Share Breakup

AS ON 30.09.2010

Category	Percentage
Government companies	0.27
Bodies corporate	97.10
Directors or relatives of Directors	1.75
Other top fifty shareholders	0.88
Total	100.00

BUSINESS DETAILS

Line of Business :

Subject is engaged in the business of Diesel engines and related components.

Products:

Product Description	ITC Code No.
Diesel Engine 15 to 250 HP	84.08

PRODUCTION STATUS AS ON 31.03.2010

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
Diesel Engines	Nos	1,44,000	1,26,000	1,09,750
Commercial Vehicles	Nos	12,000	--	--

Note: This includes 1858 nos(Prev Yr 1566 nos) of engines assembled on subcontract basis.

GENERAL INFORMATION

Bankers :

· Central Bank of India, Addison Building Branch, 803, Anna Salai, Chennai – 600 002.

Facilities :

Secured Loan	Rs. In Millions 31.03.2010	Rs. In Millions 31.03.2009
From Banks
Cash Credit	1.748	68.118
Working Capital Demand Loan	180.053	181.377
From Others
Deffered Payments Liabilities	4.111	4.856
Total	185.912	254.351
Notes: (1) Cash Credit and Working Capital Demand Loan are secured by equitable mortgage of lands and buildings ( with the exception of lands and buildings at Vishakapatnam, Kakinada, Poonamallee, Coimbatore, Mylapore and Velacherry) and hypothecation of other fixed assests, stocks, stores and book-debts except charge created on specific equipment reffered to in Note 2, and guaranteed bt the Holding Company. (2) Deffered Payment Liabilities are secured by specific equipment acquired under the respective loans.
Unsecured Loan	Rs. In Millions 31.03.2010	Rs. In Millions 31.03.2009
Holding Company	260.000	250.000
Public Deposits	160.165	137.226
Total	420.165	387.226

Banking Relations :	---
Auditors :
Name :	R.G.N. PRICE AND COMPANY Chartered Accountant
Address :	861 Anna Salai, Chennai-600002, India
PAN No:	AAAFR0651G
Holding co.:	AMALGAMATIONS PRIVATE LIMITED
CIN No.	U35999TN1938PTC000019
Subsidiaries :	Addison and company limited CIN No. U28939TN1914PL000008
	Addisons Paints and Chemicals Limited CIN No. U24222TN1948PLC000025
	Tafe Access Limlited CIN No. U15499TN1992PLC023544
	Wheel and Precision Forgings India Limited CIN No. U28910TN1951PLC003308
	Tal Precision Parts Limited CIN No. U34300TN2003PLC051919
	George Oakes Ltd. CIN No. U50300TN1956PLC000758
	India Pistons Limited CIN No. U35999TN194PLC000951
	IP Pins and Liners Limited CIN No. U35990TN1985PLC012333
	Shardlow India Limited CIN No. U35990TN1960PLC004235
	Simpson and General Finance Company Limited CIN No. U65190TN19S38PLC002355
	Sri Rama Vilas Service Limited CIN No. U29214TN1938PLC002346
	Tractors and Farm Equipment Limited CIN No. U29129TN1960PLC004337
Fellow Subsidiaries:	· Associated Printers (Madras) Private Limited · Associated Publishers (Madras) Private Limited · BBL Daido Private Limited · Speed-A-Way Private Limited · The Madras Advertising Company Private Limited
Associates:	· Amalgamations Valeo Cluch Private Limited · Mahle IPL Limited · The United Nilgiri Tea Estates Company Limited · Stanadyne Amalgamations Private Limited

CAPITAL STRUCTURE

AS ON 30.09.21010

Authorised Capital :

No. of Shares	Type	Value	Amount
11000000	Equity Shares	Rs.10/- each	Rs.110.00 Millions
100000	Redeemable Preference Shares	Rs. 100/-each	Rs.10.00 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
7500000	Equity Shares	Rs.10/- each	Rs.75.00 Millions

Of the above

Rs. in Millions

Shares allotted as fully paid up pursuant to a

Contract without payment being received in cash 0.080

Shares allotted as fully paid up bonus shares

By capitalisation of reserves 7.420

7.500

[72,43,168 Shares(Previous Year 72,43,168 shares)

are held by the holding company-

Amalgamations Private Limited.]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2010	31.03.2009	31.03.2008
SHAREHOLDERS FUNDS
1] Share Capital		75.000	75.000	75.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		5894.929	5066.171	4580.863
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		5969.929.	5141.171	4655.863
LOAN FUNDS
1] Secured Loans		185.912	254.351	191.467
2] Unsecured Loans		420.165	387.226	391.364
TOTAL BORROWING		606.077	641.577	582.831
DEFERRED TAX LIABILITIES		80.966	73.921	68.134
TOTAL		6656.972	5856.669	5306.828
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		1010.698	1028.570	788.078
Capital work-in-progress		11.192	46.611	57.283
INVESTMENT		1823.958	1852.383	1391.053
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	499.705	476.242	458.793
	Sundry Debtors	1532.077	1535.324	1729.117
	Cash & Bank Balances	2165.276	1173.392	1189.670
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	1769.292	1786.295	1604.015
Total Current Assets		5966.350	4971.253	4981.595
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	83.766	51.568	613.211
	Other Current Liabilities	672.715	563.3108	114.282
	Provisions	1398.745	1427.269	1183.687
Total Current Liabilities		2155.226	2042.1478	1911.18
Net Current Assets		3811.124	2929.105	3070.414
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		6656.972	5856.669	5306.828

PROFIT & LOSS ACCOUNT

	PARTICULARS			31.03.2010	31.03.2009	31.03.2008
	SALES
			Income	6842.085	5800.660	5837.349
			Dividend	202.936	203.378	167.683
			Other Income	195.733	155.838	168.317
			TOTAL (A)	7240.754	6159.876	6173.349
Less	EXPENSES
			Materials	4997.030	4400.326	4375.475
			Employees remuneration and benefits	317.925	270.654	259.404
			Other Expenditure	444.545	522.907	453.369
			TOTAL (B)	5759.500	5193.887	5088.248
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)			1481.254	965.989	1085.101
Less	FINANCIAL EXPENSES (D)			56.881	61.435	56.629
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)			1424.373	904.554	1028.472
Less/ Add	DEPRECIATION/ AMORTISATION (F)			73.978	82.875	73.680
	PROFIT BEFORE TAX (E-F) (G)			1350.395	821.679	954.792
Less	TAX (I)			394.544	244.658	280.106
	PROFIT AFTER TAX (G-I) (J)			955.851	577.021	674.686
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD			76.172	50.863	51.005
Add/Less	Short/Excess provision relating to earlier years			4.236	(3.967)	2.918
Less	APPROPRIATIONS
			Interim Dividend (Prev.Yr.@40%)	37.500	0.000	45.000
			Proposed Final Dividend @ 100% (Prev. Yr@ 40%)	75.000	75.000	30.000
			Corporate Tax on Dividend	18.830	12.746	12.746
			Transfer to Contingency Reserve	0.000	0.000	50.000
			Transfer to General Reserve	810.000	460.000	540.000
	BALANCE CARRIED TO THE B/S			94.929	76.171	50.863
	EARNINGS IN FOREIGN CURRENCY
		Exports on F.O.B. basis		42.256	14.788	12.394
		Agency Commission		0.671	3.487	11.736
	TOTAL EARNINGS			42.927	18.275	24.130
	IMPORTS
		Component and Spares		0.3249	8.491	14.175
		Capital items		1.003	94.064	6.286
	TOTAL IMPORTS			1.3279	102.555	20.461
	Earnings Per Share (Rs.)			125.50	74.71	88.65

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	13.20	9.37	10.93
Net Profit Margin (PBT/Sales)	(%)	19.74	14.16	16.35
Return on Total Assets (PBT/Total Assets}	(%)	19.35	730.19	16.54
Return on Investment (ROI) (PBT/Networth)		0.22	0.15	0.20
Debt Equity Ratio (Total Liability/Networth)		0.46	0.52	0.53
Current Ratio (Current Asset/Current Liability)		2.76	2.43	2.60

LOCAL AGENCY FURTHER INFORMATION

FORM 8

Name of the company	SIMPSON AND COMPANY LIMITED
Presented By	Mr. S. Srinivasaraghavan, Executive Director(Finance) and Secretary
1) Date and description of instrument creating the change	20.12.1972 –Deed of Hypothecation
2) Amount secured by the charge/amount owing on the securities of charge	Rs. 45.750 Millions
3) Short particular of the property charged. If the property acquired is subject to charge, date of the acquired of the property should be given	As detailed in item 1 above
4) Gist of the terms and conditions and extent and operation of the charge.	As per the letter of Hypothecation and Supplemental letter of Hypothecation already registered from time to time.
5) Name and Address and description of the person entitled to the charge.	Central Bank of India, Addison Building Branch, 803, Anna Salai, Chennai – 600 002.
6) Date and brief description of instrument modifying the charge	01.06.2001 Supplemental Letter of Hypothecation dated 01.06.2001 in favour of Central Bank of India, Addison Buildings Branch, 803 Anna Salai, Chennai – 600 002 for the following revised credit facilities. Credit Limi8t has been enhanced from Rs. 343.750 Millions to Rs.348.750 Millions.
Rate of Interest	12.5%
Copy of Supplemental Letter of Hypothecation and also a copy of letter No.AB/ADV:42/2000-2001:1250 dated 30.03.2001 received from Central Bank of India, Addison Building Branch, Chennai – 600 002, sanctioning the above facilities are enclosed.
7) Particulars of modifications specifying the terms and conditions or the extent of operations of the charge in which modification is made and the details of the modification.	Consequent to the modifications now made, the amount secured is as under: Credit limit has been enhanced from Rs.343.750 Millions to Rs. 348.750 Millions.

OPERATIONS:

During 2009-10 the Company was able to achieve higher levels of sales turnover, due to increase in sales to tractor segment. The turnover was Rs.68.421 Millions as against Rs. 58.006 Millions achieved in 2008-09. The production was higher at 109750 diesel engines (2008-09: 90,637 Nos.). Cost control and effective steps taken to rationalize the operations over the period resulted in improving the operational profitability. New product development and up-gradation of existing engines continued during the year to meet competitive and regulatory requirement.

OUTLOOK FOR THE CURRENT YEAR:

The Industries they are serving, particularly the Tractor segment, has registered significant growth which is projected to continue in the current year, enabling them to offer more engines including the upgraded and newly introduced engines. However the availability of certain critical requirements like Castings due to Power limitations is impacting the production.

The After Market Sales is expected to show further improvement over last year.

Fixed Assets

· Land Freehold

· Buildings

· Plant and Machinery

· Electrical installation

· Furniture and fixtures

· Office equipments

· Vehicles

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.47.79
UK Pound	1	Rs.75.05
Euro	1	Rs.65.35

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	8
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	8
--PROFITABILIRY	1~10	8
--LIQUIDITY	1~10	7
--LEVERAGE	1~10	7
--RESERVES	1~10	8
--CREDIT LINES	1~10	6
--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		65

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	-

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