MIRA INFORM REPORT

Report Date :

28.08.2012

IDENTIFICATION DETAILS

Name :	K H LEATHER INDUSTRIES PRIVATE LIMITED
Registered Office :	829/1, Periyar EVR High Road, Kipauk, Chennai-600010, Tamilnadu
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	06.08.1976
Com. Reg. No.:	18-007182
Capital Investment / Paid-up Capital :	Rs. 2.496 millions
CIN No.: [Company Identification No.]	U19119TN1976PTC007182
TAN No.: [Tax Deduction & Collection Account No.]	CHEK00528D
PAN No.: [Permanent Account No.]	AAACK1425C
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacture and sale of Leather Shoes and Leather Shoe Uppers.
No. of Employees :	500 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

A (58)

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 1800000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established and a reputed company having fine track. Financial position of the company appears to be sound. Directors are reported to be experienced and respectable businessmen. Trade relations are reported as fair. Business is active. Payments are reported to be usually correct and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

NOTES :

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

ECGC Country Risk Classification List – June 30, 2012

Country Name	Previous Rating (31.03.2012)	Current Rating (30.06.2012)
India	A1	A1

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

RBI DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available RBI Defaulters’ list.

EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of 31-03-2012.

LOCATIONS

Registered Office :	829/1, Periyar EVR High Road, Kipauk, Chennai-600010, Tamilnadu
Tel. No.:	91-44-26412708 / 26412433 / 26427529 / 26427531
Fax No.:	91-44-26423237 / 26427528
E-Mail :	headoffice@ahindia.com khgroup@vsnl.com khizaria@md2.vsnl.net.in ahgroup@vsnl.com
Factory :	No.18, Krishnagiri Bypass Road, Ranipet, Vellore District – 632 401, Tamilnadu, India
Tel. No.:	91-4172-270945 / 46
Fax No.:	91-4172 – 272574

DIRECTORS

As on 30.09.2011

Name :

Mr. Akber Hussian Malack

Designation :

Director

Address :

Old No. 829/1, New No. 266, Periyar EVR High Road, Chennai – 600 010, Tamilnadu, India

Date of Birth/Age :

13.10.1970

Qualification :

L Tech

Date of Appointment :

27.10.1988

DIN No.:

00972614

Other Directorship:

S.NO.	CIN/LLPIN	NAME OF THE COMPANY/ LLP	CURRENT DESIGNATION OF THE DIRECTOR/ DESIGNATED PARTNER	DATE OF APPOINTMENT AT CURRENT DESIGNATION	ORIGINAL DATE OF APPOINTMENT	DATE OF CESSATION	COMPANY/ LLP STATUS	DEFAULTING STATUS
1	U19119TN1976PTC007182	K H LEATHER INDUSTRIES PRIVATE LIMITED	Director	27/10/1988	27/10/1988	-	Active	NO
2	U73100TN1991NPL021372	K.H.FOUNDATION	Director	06/09/1992	06/09/1992	-	Active	NO
3	U29309TN1989PLC017370	RANIPET TANNERY EFFLUENT TREATMENT COMPANY LIMITED	Director	29/09/2001	29/09/2001	-	Active	NO
4	U19112TN2004PTC054760	SOLAR SOLES PRIVATE LIMITED	Director	30/11/2004	30/11/2004	-	Active	NO
5	U52601TN2009PTC073193	H M RETAIL OUTLET PRIVATE LIMITED	Director	14/10/2009	14/10/2009	-	Active	NO
6	U51900TN2009PTC073802	RITEBRAND RETAIL PRIVATE LIMITED	Director	08/12/2009	08/12/2009	-	Active	NO

Name :

Mr. Akther Hussain Malack

Designation :

Director

Address :

Old No. 829/1, New No. 266, Periyar EVR High Road, Chennai – 600 010, Tamilnadu, India

Date of Birth/Age :

03.03.1973

Qualification :

F Tech

Date of Appointment :

15.03.1991

DIN No.:

00972693

Other Directorship:

S.NO.	CIN/LLPIN	NAME OF THE COMPANY/ LLP	CURRENT DESIGNATION OF THE DIRECTOR/ DESIGNATED PARTNER	DATE OF APPOINTMENT AT CURRENT DESIGNATION	ORIGINAL DATE OF APPOINTMENT	DATE OF CESSATION	COMPANY/ LLP STATUS	DEFAULTING STATUS
1	U19119TN1976PTC007182	K H LEATHER INDUSTRIES PRIVATE LIMITED	Director	15/03/1991	15/03/1991	-	Active	NO
2	U73100TN1991NPL021372	K.H.FOUNDATION	Director	06/09/1992	06/09/1992	-	Active	NO
3	U19112TN2004PTC054760	SOLAR SOLES PRIVATE LIMITED	Director	30/11/2004	30/11/2004	-	Active	NO
4	U52601TN2009PTC073193	H M RETAIL OUTLET PRIVATE LIMITED	Director	14/10/2009	14/10/2009	-	Active	NO
5	U51900TN2009PTC073802	RITEBRAND RETAIL PRIVATE LIMITED	Director	08/12/2009	08/12/2009	-	Active	NO

MAJOR SHAREHOLDERS

As on 30.09.2011

Names of Shareholders	No. of Shares
Akber Hussain Malack	11832
Mohsina Begum	1750
Akther Hussain Malack	11383
Total	24965

Equity Share Break up (Percentage of Total Equity)

Category	Percentage
Directors or relatives of Directors	100.00
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacture and sale of Leather Shoes and Leather Shoe Uppers.

Products :

ITEM CODE NO.	PRODUCT DESCRIPTION
64035101	Leather Shoes
64051000	Leather Shoe Uppers

PRODUCTION STATUS [AS ON 31.03.2010]

Particulars	Unit	Installed Capacity	Actual Production
Footwear	Pairs	200000	704631
Shoe Uppers	Pairs	450000	--

GENERAL INFORMATION

No. of Employees :	500 [Approximately]
Bankers :	Indian Bank, Park Town Branch, Chennai - 600 003, Tamilnadu, India State Bank of India, International Leather Division, 177/1, Poonawala High Road, Kilpauk, Chennai – 600 010, Tamilnadu, India

Banking Relations :	--
Auditors :
Name :	D. Sampathkumar and Company Chartered Accountants
Address :	New No. 5 (Old No. 3), South Boag Road, T. Nagar, Chennai – 600 017, Tamilnadu, India
Tel. No.:	91-44-24341189
PAN Mo.:	AAAFD2288D
Associates :	Solar Soles Private Limited
Others (Firms) :	Sara Leather Industries Sara Shoes Khizaria Leathers

CAPITAL STRUCTURE

As on 30.09.2011

Authorized Capital:

No. of Shares	Type	Value	Amount
50000	Equity Shares	Rs. 100/- each	Rs. 5.000 millions

Issued, Subscribed & Paid-up Capital:

No. of Shares	Type	Value	Amount
24965	Equity Shares	Rs. 100/- each	Rs. 2.496 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2011	31.03.2010	31.03.2009
SHAREHOLDERS FUNDS
1] Share Capital		2.496	2.496	2.496
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		457.069	439.781	427.152
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		459.565	442.277	429.648
LOAN FUNDS
1] Secured Loans		0.000	0.000	0.000
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		0.000	0.000	0.000
DEFERRED TAX LIABILITIES		2.163	0.247	2.847
TOTAL		461.728	442.524	432.495
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		155.056	169.378	153.775
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		13.535	0.000	4.204
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	90.816	60.002	23.506
	Sundry Debtors	244.443	216.928	209.336
	Cash & Bank Balances	28.948	23.484	111.016
	Other Current Assets	31.065	0.000	0.000
	Loans & Advances	73.184	85.286	44.561
Total Current Assets		468.456	385.700	388.419
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	168.941	107.916	99.072
	Other Current Liabilities	6.378	4.638	14.831
	Provisions	0.000	0.000	0.000
Total Current Liabilities		175.319	112.554	113.903
Net Current Assets		293.137	273.146	274.516
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		461.728	442.524	432.495

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Income	1390.962	966.700	1050.400
		Other Income	60.831	12.300	13.600
		TOTAL	1451.793	979.000	1064.000
Less	EXPENSES
		Office Expenses
		Administrative Expenses	1404.370	947.500	1000.800
		Advertising Expenses
		TOTAL	1404.370	947.500	1000.800
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION		47.423	31.500	63.200
Less/ Add	DEPRECIATION/ AMORTISATION		17.898	19.500	16.000
	PROFIT BEFORE TAX		29.525	12.000	47.200
Less	TAX		12.237	(0.600)	6.200
	PROFIT AFTER TAX		17.288	12.600	41.000
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		433.626	421.000	380.000
	BALANCE CARRIED TO THE B/S		450.914	433.600	421.000
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	1348.987	951.203	1031.844
	TOTAL EARNINGS		1348.987	951.203	1031.844
	IMPORTS
		Raw Materials		117.090	0.000
		Stores & Spares	144.883	13.523	11.230
		Capital Goods		21.812	18.546
	TOTAL IMPORTS		144.883	152.425	29.776
	Earnings Per Share (Rs.)		693	506	1646

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	1.19	1.29	3.85
Net Profit Margin (PBT/Sales)	(%)	2.12	1.24	4.49
Return on Total Assets (PBT/Total Assets}	(%)	4.73	2.16	8.71
Return on Investment (ROI) (PBT/Networth)		0.06	0.03	0.11
Debt Equity Ratio (Total Liability/Networth)		0.38	0.25	0.27
Current Ratio (Current Asset/Current Liability)		2.67	3.43	3.41

LOCAL AGENCY FURTHER INFORMATION

Sr. No.	Check List by Info Agents	Available in Report (Yes / No)
1]	Year of Establishment	Yes
2]	Locality of the firm	Yes
3]	Constitutions of the firm	Yes
4]	Premises details	No
5]	Type of Business	Yes
6]	Line of Business	Yes
7]	Promoter's background	Yes
8]	No. of employees	Yes
9]	Name of person contacted	No
10]	Designation of contact person	No
11]	Turnover of firm for last three years	Yes
12]	Profitability for last three years	Yes
13]	Reasons for variation <> 20%	----
14]	Estimation for coming financial year	No
15]	Capital in the business	Yes
16]	Details of sister concerns	Yes
17]	Major suppliers	No
18]	Major customers	No
19]	Payments terms	No
20]	Export / Import details (if applicable)	No
21]	Market information	----
22]	Litigations that the firm / promoter involved in	----
23]	Banking Details	Yes
24]	Banking facility details	No
25]	Conduct of the banking account	----
26]	Buyer visit details	----
27]	Financials, if provided	Yes
28]	Incorporation details, if applicable	Yes
29]	Last accounts filed at ROC	Yes
30]	Major Shareholders, if available	Yes
31]	Date of Birth of Proprietor/Partner/Director, if available	Yes
32]	PAN of Proprietor/Partner/Director, if available	No
33]	Voter ID No of Proprietor/Partner/Director, if available	No
34]	External Agency Rating, if available	No

OPERATIONS:

During the year ended 31st March, 2011, the Company had achieved a turnover of Rs.1390.962 Millions as against Rs.966.766 millions in the preceding year. The Company had earned a net profit before tax of Rs.29.524 millions as against Rs.12.078 millions in the preceding year recording a growth in net profit by 144.44% as compare to the previous year. Your directors are expecting to achieve increased turnover and profitability in

the ensuing financial year.

FIXED ASSETS

· Land and Land Improvements

· Building

· Factory Building

· Plant and Machinery

· Computer Equipments

· Furniture and Fixtures

· Motor 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.55.59
UK Pound	1	Rs.87.87
Euro	1	Rs.69.49

INFORMATION DETAILS

Report Prepared by :

NID

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	7
--LIQUIDITY	1~10	7
--LEVERAGE	1~10	6
--RESERVES	1~10	7
--CREDIT LINES	1~10	6
--MARGINS	-5~5	-
DEMERIT POINTS
--BANK CHARGES	YES/NO	NO
--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	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		58

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.