MIRA INFORM REPORT

Report Date :

21.09.2011

IDENTIFICATION DETAILS

Name :	CHERAN SPINNER LIMITED [w.e.f. 16.04.2001]
Formerly Known As :	CHERAN SPINNER PRIVATE LIMITED
Registered Office :	SF No. 477/1, Patharai, Anangur Main Road, Sowthapuram (Post) Erode-638008, Tamilnadu
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	21.07.1989
Com. Reg. No.:	18-002487
Capital Investment / Paid-up Capital :	Rs.18.483 Millions
CIN No.: [Company Identification No.]	U17111TZ1989PLC002487
Legal Form :	A closely held Public Limited Liability Company.
Line of Business :	Manufacturer and Exporter of Yarns.
No. of Employees :	800 [Approximately]

RATING & COMMENTS

MIRA’s Rating :

Ba (49)

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

Maximum Credit Limit :	USD 1400000
Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject is a well established company having satisfactory track records. 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 PARTED BY

Name :	Mr. Thangavel Palanisamy
Designation :	Director
Contact No.:	91-9842742102
Date :	20.09.2011

LOCATIONS

Registered Office / Factory:	SF No. 477/1, Patharai, Anangur Main Road, Sowthapuram (Post) Erode-638008, Tamilnadu, India
Tel. No.:	91-4288-278601 / 278604 / 240866 / 242104
Mobile No.:	91-9842742102 [Mr. Thangavel Palanisamy]
Fax No.:	91-4288-278605 / 240665
E-Mail :	office@tnramadossco.com
Area:	13 acres (Owned)

DIRECTORS

As on 30.09.2010

Name :

Mr. S. Muthusamy

Designation :

Director

Address :

Theartre Road, Gandhipuram, Pallipalayam, Erode-638006, Tamilnadu, India

Date of Birth/Age :

01.06.1951

Date of Appointment :

21.07.1989

Din No.:

00012110

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	U17111TZ1989PLC002487	CHERAN SPINNER LIMITED	Director	21-07-89	21-07-89	-	Active	NO
2	U17111TZ1995PLC005909	PALLAVA TEXTILE LIMITED	Director	10-03-95	10-03-95	03-11-10	Active	NO
3	U17111TZ2005PTC012324	CHERAN WEAVES INDIA PRIVATE LIMITED	Director	28-11-05	28-11-05	-	Active	YES
4	U17111TZ2006PLC012662	BEST CHERAN SPINTEX INDIA LIMITED	Director	20-03-06	20-03-06	-	Active	NO

Name :

Mr. V.S. Palanisamy

Designation :

Director

Address :

1-A-3 Sankari By-Pass Road, Pallipalayam, Namakkal-638006, Tamilnadu, India

Date of Birth/Age :

12.01.1948

Date of Appointment :

21.07.1989

Din No.:

01369156

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	U17111TZ1989PLC002487	CHERAN SPINNER LIMITED	Director	21-07-89	21-07-89	03-11-10	Active	NO
2	U17111TZ1995PLC005909	PALLAVA TEXTILE LIMITED	Director	10-03-95	10-03-95	-	Active	NO
3	U17111TZ2002PLC010398	V S M WEAVES INDIA LIMITED	Director	02-04-07	13-12-02	-	Active	NO
4	U18101DL2003PTC121197	R M D FABRICS PRIVATE LIMITED	Director	07-07-03	07-07-03	-	Active	NO
5	U17111TZ2005PLC011749	SHRI CHERAN SYNTHETICS INDIA LIMITED	Whole-time director	02-05-07	21-04-05	-	Active	NO
6	U17111TZ2005PTC011820	V S P INDUSTRIES PRIVATE LIMITED	Director	20-05-05	20-05-05	-	Active	NO

Name :

Mr. S. Muthusamy

Designation :

Director

Address :

1-A-3 Sankari By-Pass Road, Pallipalayam, Namakkal-638006, Tamilnadu, India

Date of Birth/Age :

09.01.1939

Date of Appointment :

21.07.1989

Din No.:

01369099

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	U17111TZ1989PLC002487	CHERAN SPINNER LIMITED	Director	21-07-89	21-07-89	03-11-10	Active	NO
2	U17111TZ1995PLC005909	PALLAVA TEXTILE LIMITED	Director	10-03-95	10-03-95	-	Active	NO
3	U17111TZ2002PLC010398	V S M WEAVES INDIA LIMITED	Director	13-12-02	13-12-02	-	Active	NO
4	U18101DL2003PTC121197	R M D FABRICS PRIVATE LIMITED	Director	07-07-03	07-07-03	-	Active	NO
5	U17111TZ2005PLC011749	SHRI CHERAN SYNTHETICS INDIA LIMITED	Director	21-04-05	21-04-05	-	Active	NO
6	U17111TZ2005PTC011820	V S P INDUSTRIES PRIVATE LIMITED	Director	20-05-05	20-05-05	-	Active	NO

Name :

Mr. G.M. Palanisamy

Designation :

Director

Address :

165, Paper Mill Road, Pallipalayam, Namakkal-638006, Tamilnadu, India

Date of Birth/Age :

19.11.1939

Date of Appointment :

21.07.1989

Name :

Mr. A.S. Palanisamy

Designation :

Director

Address :

Theartre Road, Gandhipuram, Pallipalayam, Erode-638006, Tamilnadu, India

Date of Birth/Age :

01.06.1946

Date of Appointment :

21.07.1989

Din No.:

00012155

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	U17111TZ1989PLC002487	CHERAN SPINNER LIMITED	Director	21-07-89	21-07-89	-	Active	NO
2	U17111TZ1995PLC005909	PALLAVA TEXTILE LIMITED	Director	10-03-95	10-03-95	03-11-10	Active	NO
3	U17111TZ2005PTC012324	CHERAN WEAVES INDIA PRIVATE LIMITED	Director	28-11-05	28-11-05	-	Active	YES
4	U17111TZ2006PLC012662	BEST CHERAN SPINTEX INDIA LIMITED	Director	20-03-06	20-03-06	-	Active	NO

Name :

Mr. P.D. Thangavel

Designation :

Director

Address :

79, R.P. Street, Sankari Bye Pass Road, Pallipalayam, Tiruchengode TK

Date of Birth/Age :

27.10.1973

Date of Appointment :

30.06.2010

Din No.:

00011246

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	U17111TZ1995PLC005909	PALLAVA TEXTILE LIMITED	Director	28-09-98	28-09-98	03-11-10	Active	NO
2	U17111TZ2006PLC012662	BEST CHERAN SPINTEX INDIA LIMITED	Director	20-03-06	20-03-06	-	Active	NO
3	U17111TZ1989PLC002487	CHERAN SPINNER LIMITED	Additional director	30-06-10	30-06-10	-	Active	NO

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 30.09.2010

Names of Shareholders	No. of Shares
R. Pongianna Gounder	13820
S. Muthusamy	12440
A.S. Palanisamy	12440
R. P. Duraisamy	40130
R. P. Desarnani	36868
P. Thangavel	13580
P. Saraswathi	10626
P. Poongodi	2100
P. Thangavel HUF	320
D. Logeshkurnar	4210
P.D. Thangavel	5370
D. Padrnalakshmi	3160
P. D. Balachandaran	3140
RPD Shanthi	4200
M. Rarnakrishnaprasad	22426
Total	184830

As on 30.09.2010

Equity Share Breakup	Percentage of Holding
Category
Directors or relatives of directors	100.00
Total	100.00

BUSINESS DETAILS

Line of Business :	Manufacturer and Exporter of Yarns.
Brand Names :	“CHERAN REDEFINING QUALITY”
Exports :
Countries :	South America Japan Egypt
Imports :
Products :	Fiber
Countries :	France
Terms :
Selling :	L/C / Credit
Purchasing :	L/C / Credit

GENERAL INFORMATION

No. of Employees :

800 [Approximately]

Bankers :

State Bank of India, Commercial Branch, CD Building, 78/79, Park Road, Erode-638003, Tamilnadu, India

Facilities :

Secured Loan	As on 31.03.2010 [Rs. in Millions]	As on 31.03.2009 [Rs. in Millions]
Term Loan:
State Bank of India	79.258	90.658
ING Vysya Bank Limited	0.000	2.116
Hire purchase Loan from ICICI Bank Limited	0.232	0.510
Working Capital Loans:
State Bank of India	84.647	88.488
ING Vysya Bank Limited	42.787	53.164
Total	206.924	234.936

Banking Relations :	--
Auditors :
Name :	T.N. Ramadoss and Company Chartered Accountant
Address :	No. 54, Town Railway Station Road, Salem-638001, Tamilnadu, India
Associates/Subsidiaries :	Best Cheran Spinner India Limited Address: S.F No. 198, Elanthakuttai Village, Erode, Tamilnadu, India Line of Business: Manufacturer and Exporter of Yarns.

CAPITAL STRUCTURE

As on 31.03.2010

Authorised Capital :

No. of Shares	Type	Value	Amount
185000	Equity Shares	Rs.100/- each	Rs.18.500 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
184830	Equity Shares	Rs.100/- each	Rs.18.483 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		18.483	18.483	18.483
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		336.950	299.434	314.254
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		355.433	317.917	332.737
LOAN FUNDS
1] Secured Loans		206.924	234.936	274.293
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		206.924	234.936	274.293
DEFERRED TAX LIABILITIES		45.731	48.084	62.576
TOTAL		608.088	600.937	669.606
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		272.964	292.666	317.002
Capital work-in-progress		1.452	2.692	10.240
INVESTMENT		25.000	25.000	25.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	124.663	89.338	148.583
	Sundry Debtors	169.240	98.999	70.696
	Cash & Bank Balances	14.914	19.454	13.152
	Other Current Assets	11.457	11.358	11.712
	Loans & Advances	165.205	192.984	204.891
Total Current Assets		485.479	412.133	449.034
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	166.931	125.793	126.271
	Other Current Liabilities	0.000	0.000	0.000
	Provisions	10.081	6.240	6.205
Total Current Liabilities		177.012	132.033	132.476
Net Current Assets		308.467	280.100	316.558
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
DEFERRED REVENUE EXPENDITURE		0.205	0.479	0.806
TOTAL		608.088	600.937	669.606

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Income	1053.893	801.190	917.099
		Other Income	188.472	113.452	96.851
		TOTAL (A)	1242.365	914.642	1013.950
Less	EXPENSES
		Consumption of Raw Materials	702.957	576.071	710.198
		Purchase of Yarn	107.367	14.203	3.634
		Manufacturing Expenses	210.460	115.498	106.271
		Administrative and Other Expenses	36.983	47.317	31.274
		Selling Expenses	72.545	62.973	73.075
		Wind Mill Expenses	4.462	2.925	32.399
		Material in Process on 01.04.2009	11.220	32.290	21.788
		Remission of Liability	0.000	0.000	46.054
		Material in Process on 31.03.2010	(18.470)	(11.220)	(32.290)
		Increase / Decrease in Stock of Finished Goods	(6.102)	18.568	(24.300)
		TOTAL (B)	1121.422	858.625	968.103
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		120.943	56.017	45.847
Less	FINANCIAL EXPENSES (D)		30.289	43.970	31.932
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		90.654	12.047	13.915
Less/ Add	DEPRECIATION/ AMORTISATION (F)		45.460	41.145	49.372
	PROFIT / LOSS BEFORE TAX (E-F) (G)		45.194	(29.098)	(35.457)
Less	TAX (H)		7.678	(14.279)	(12.191)
	PROFIT / LOSS AFTER TAX (G-H) (I)		37.516	(14.819)	(23.266)
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	NA	650.941	NA
	IMPORTS
		Raw Materials	NA	21.423	NA
		Stores & Spares	NA	0.941	NA
	TOTAL IMPORTS		NA	22.364	NA
	Earnings Per Share (Rs.)		202.98	(80.18)	--

Particulars	31.03.2011
Sales Turnover [Approximately]	1050.000

The above information has been parted by Mr. Thangavel Palanisamy.

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	3.02	(1.62)	(2.29)
Net Profit Margin (PBT/Sales)	(%)	4.29	(3.63)	(3.87)
Return on Total Assets (PBT/Total Assets}	(%)	5.96	(4.13)	(4.63)
Return on Investment (ROI) (PBT/Networth)		0.13	(0.09)	(0.11)
Debt Equity Ratio (Total Liability/Networth)		1.08	1.15	1.22
Current Ratio (Current Asset/Current Liability)		2.74	3.12	3.39

LOCAL AGENCY FURTHER INFORMATION

Note: The registered office of the company has been shifted from 1-A/3, Sankiri Bypass Road, Pallipalayam, Erode, Tamilnadu, India to the present address w.e.f. 20.12.2007.

PERFORMANCE:

During the year the performance of the Company was good. In the Current year, turnover of the company has been increased from Rs.801.190 Millions to Rs.1053.893 Millions with a rise of 31.54 %. The production of the Company has been increased from 54.00 Lakhs Kgs to 59.15 Lakhs Kgs. Due to overall optimum capacity utilization, better product mix, increase in realization price of yarn and a radical increase in conversion receipts, the profit before depreciation and interest has been remarkably increased to tune of 115.90% as compared to previous year. On account of DEPB, Drawback receipts and Forex transactions, the company able to increase its revenue by Rs.32.181 Millions as compare to previous year. Resultantly the Company was able to earn profit before tax of Rs.45.194 Millions as against the loss before tax of Rs.29.098 Millions in the previous year. During the year the company earned cash profit of Rs.82.976 Millions as against Rs.26.326 Millions in the previous year.

Bankers Charges Report as per Registry

This form is for	Modification of charge
Charge identification number of the modified	10065964
Corporate identity number of the company	U17111TZ1989PLC002487
Name of the company	CHERAN SPINNER LIMITED
Address of the registered office or of the principal place of business in India of the company	SF No. 477/1, Patharai, Anangur Main Road, Sowthapuram (Post) Erode-638008, Tamilnadu, India
Type of charge	Book Debts Movable Property (not being pledge) Immovable Property
Particular of charge holder	State Bank of India, Commercial Branch, CD Building, 78/79, Park Road, Erode-638003, Tamilnadu, India
Email	thirumurugan.s@sbi.co.in
Nature of description of the instrument creating or modifying the charge	Creation of EM by deposit of Title Deeds as per EM confirmation letter.
Date of instrument Creating the charge	02.05.2011
Amount secured by the charge	Rs.598.500 Millions
Brief particulars of the principal terms an conditions and extent and operation of the charge	Rate of Interest No change in the interest rates for WC and TL Terms of Repayment No change in the existing TL repayment schedule Margin No change in the margin Extent and Operation of the charge CC and EPC - First Charge on RM, SIP, FG, Stores, consumables, stores, receivables and other current assets of the company on pari passu basis with ING Vysya Bank Limited LC - Merchandise covered under LC and Extension of charge over Current Assets BG - Counter Guarantee of the Company and Extension of charge over Current Assets Extension of EM over properties as per annexure attached in addition to the properties created on 19-07-2010.
Short particulars of the property charged	I) SF No.375/3,Jangalpatti Village, Theni Taluka, Theni Dt - 2 Acres II) SF No.412/1 to 4,Jangalpatti Village, Theni Taluka, Theni Dt - 1.89 Acres III) SF No.458/1,459/1,460/1,2,Vavipalayam Village, Tirupur Tk, Tirupur Dt. - 20 Acres
Date of latest modification prior to the present modification	19.07.2010
Particulars of the present modification	There is no change in the credit facilities extended by State Bank of India, Commercial Branch, Erode

TRADE REFERENCES:

• Ikea, Turkey
• Ilicat, Italy

FIXED ASSETS:

• Land
• Building
• Plant and Machinery
• Electrical Installations
• Weighing Machinery
• Electronic Weighing
• Fire Extinguisher
• Testing Equipments
• Furniture and Fittings
• Office Equipments
• Heavy Commercial Vehicles
• Other Vehicles
• Computer
• Humidification Plant
• Motor Cycle

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] 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.48.22
UK Pound	1	Rs.75.63
Euro	1	Rs.65.65

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--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		49

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.