MIRA INFORM REPORT

Report Date :

22.12.2012

IDENTIFICATION DETAILS

Name :	SPECIALTY POLYFILMS (INDIA) PRIVATE LIMITED

Registered Office :	F-89, M.I.D.C. Area, Waluj, Aurangabad – 431 136, Maharashtra

Country :	India

Financials (as on) :	31.03.2012

Date of Incorporation :	23.03.2000

Com. Reg. No.:	11-125209

Capital Investment / Paid-up Capital :	Rs.29.000 Millions

CIN No.: [Company Identification No.]	U25209MH2000PTC125209

TAN No.: [Tax Deduction & Collection Account No.]	NSKS04309E/ NSKS04348B/ NSKS07046E

Legal Form :	Private Limited Liability Company

Line of Business :	Manufacturing of LLDPE Stretch Cling Films.

No. of Employees :	200 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

B (30)

RATING

STATUS

PROPOSED CREDIT LINE

26-40

Capability to overcome financial difficulties seems comparatively below average.

Small

Maximum Credit Limit :	USD 229000

Status :	Moderate

Payment Behaviour :	Slow but correct

Litigation :	Clear

Comments :	Subject is an established company having moderate track record. There appears a huge external borrowing recorded by the company which acts as a threat for the company’s liquidity. However, trade relations are reported as fair. Business is active. Payments are reported to be slow but correct. The company can be considered for business dealings with some cautions. Note: Mr. Pathak, Assistant Manager (State Bank of India) has reported that the subject maintains proper and satisfactory banking relation.

NOTES :

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

INDIAN ECONOMIC OVERVIEW

India is developing into an open-market economy, yet traces of its past autarkic policies remain. Economic liberalization, including industrial deregulation, privatization of state-owned enterprises, and reduced controls on foreign trade and investment, began in the early 1990s and has served to accelerate the country's growth, which has averaged more than 7% per year since 1997. India's diverse economy encompasses traditional village farming, modern agriculture, handicrafts, a wide range of modern industries, and a multitude of services. Slightly more than half of the work force is in agriculture, but services are the major source of economic growth, accounting for more than half of India's output, with only one-third of its labor force. India has capitalized on its large educated English-speaking population to become a major exporter of information technology services and software workers. In 2010, the Indian economy rebounded robustly from the global financial crisis - in large part because of strong domestic demand - and growth exceeded 8% year-on-year in real terms. However, India's economic growth in 2011 slowed because of persistently high inflation and interest rates and little progress on economic reforms. High international crude prices have exacerbated the government's fuel subsidy expenditures contributing to a higher fiscal deficit, and a worsening current account deficit. Little economic reform took place in 2011 largely due to corruption scandals that have slowed legislative work. India's medium-term growth outlook is positive due to a young population and corresponding low dependency ratio, healthy savings and investment rates, and increasing integration into the global economy. India has many long-term challenges that it has not yet fully addressed, including widespread poverty, inadequate physical and social infrastructure, limited non-agricultural employment opportunities, scarce access to quality basic and higher education, and accommodating rural-to-urban migration.

Source : CIA

EXTERNAL AGENCY RATING

Rating Agency Name	CRISIL
Rating	B+ (Long Term Rating)
Rating Explanation	High risk of default
Date	November 01, 2012

Rating Agency Name	CRISIL
Rating	A4 (Short Term Rating)
Rating Explanation	Minimal degree of safety and very high credit risk
Date	November 01, 2012

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.

INFORMATION PARTED BY

Name :	Mr. Vinod
Designation :	Accounts Manager
Contact No.:	91-240-2554046
Date :	21.12.2012

LOCATIONS

Registered Office/ Factory :	F-89, M.I.D.C. Area, Waluj, Aurangabad – 431 136, Maharashtra, India
Tel. No.:	91-240-2554046/ 2551015/ 2554045
Fax No.:	91-240-2554046
E-Mail :	specialty@satyam.net.in marketing@specialty-films.com export@specialty-films.com asha@specialty-films.com shantanu@specialty-films.com
Website :	http://www.specialty-films.com
Location :	Owned

DIRECTORS

As on 27.09.2012

Name :	Mr. Shantanu Manohar Deshpande
Designation :	Chairman cum Managing Director
Address :	18, Sahyog Nagar, Ulkanagar, Garkheda, Aurangabad – 431 005, Maharashtra, India
Date of Birth/Age :	21.09.1969
Qualification :	B E Computer Science
Experience :	23 Years experience in Manufacturing of Wrapping Films.
Date of Appointment :	23.03.2000
DIN No. :	00388944

Name :	Mrs. Asha Shantanu Deshpande
Designation :	Director
Address :	18, Sahyog Nagar, Ulkanagar, Garkheda, Aurangabad – 431 005, Maharashtra, India
Date of Birth/Age :	02.12.1972
Date of Appointment :	01.04.2005
DIN No. :	00389026

KEY EXECUTIVES

Name :	Mr. Vinod
Designation :	Accounts Manager

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 09.09.2011

Names of Shareholders		No. of Shares
Shantanu Manohar Deshpande		1765468
Asha Shantanu Deshpande		800837
Shashank Manohar Deshpande		271645
Madhavi Manohar Deshpande		53550
Priya Manohar Deshpande		8500
Total		2900000

As on 27.09.2012

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

BUSINESS DETAILS

Line of Business :	Manufacturing of LLDPE Stretch Cling Films.

Exports :
Products :	LLDPE Stretch Cling Films
Countries :	v UK v Vietnam

Imports :
Products :	Raw Materials
Countries :	Singapore

Terms :
Selling :	Cash and Credit

Purchasing :	Cash and Credit

GENERAL INFORMATION

Suppliers :	v Dow Chemical Company

Customers :	Wholesalers ad Retailers v The Procter and Gamble Company v Hindustan Coca-Cola Beverages Private Limited

No. of Employees :	200 (Approximately)

Bankers :	v Janata Sahakari Bank Limited, Pune Branch, Aurangabad, Maharashtra, India v State Bank of India, Industrial Finance Branch, Jaggi’s Building, Kranti Chowk, Jalna Road, Aurangabad – 431 005, Maharashtra, India (Mr. Suraj – Chief Manager, Contact No.: 91-240-2321264) v Janata Sahakari Bank Limited, Mumbai, Maharashtra, India v Janata Sahakari Bank Limited, Pune, Maharashtra, India v HDFC Bank Limited, Aurangabad, Maharashtra, India v ICICI Bank Limited, Aurangabad, Maharashtra, India v IDBI Bank Limited, Aurangabad, Maharashtra, India v United Western Bank Limited, Aurangabad, Maharashtra, India

Facilities :	Term Loan and Cash Credit – Rs.100.000 millions (From State Bank of India)


Banking Relations :	--

Auditors :
Name :	Ashok Patil and Associates Charted Accountants
Address :	"A.P. Heights", Behind Gopal Cultural Hall, New Osmanpura, Aurangabad – 431 005, Maharashtra, India
Income-tax PAN of auditor or auditor's firm :	ABFPP1555R

CAPITAL STRUCTURE

As on 27.09.2012

Authorised Capital :

No. of Shares	Type	Value	Amount
3000000	Equity Shares	Rs.10/- each	Rs.30.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
2900000	Equity Shares	Rs.10/- each	Rs.29.000 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2012	31.03.2011	31.03.2010
SHAREHOLDERS FUNDS
1] Share Capital		29.000	29.000	29.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		28.144	21.275	11.900
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		57.144	50.275	40.900
LOAN FUNDS
1] Long-Term Borrowings		53.833	54.965	136.917
2] Short-Term Borrowings		81.574	54.414
TOTAL BORROWING		135.407	109.379	136.917
DEFERRED TAX LIABILITIES		4.664	5.129	5.783

TOTAL		197.215	164.783	183.600

APPLICATION OF FUNDS

FIXED ASSETS [Net Block]		82.816	87.620	97.093
Capital work-in-progress		13.390	3.554	0.339

INVESTMENT		0.110	0.110	0.110
DEFERRED TAX ASSETS		0.000	0.000	0.000

CURRENT ASSETS, LOANS & ADVANCES
	Inventories	75.851	52.728	51.831
	Sundry Debtors	62.299	48.727	34.710
	Cash & Bank Balances	3.550	2.419	0.414
	Other Current Assets	6.270	8.434	10.617
	Loans & Advances	4.117	3.033	2.903
Total Current Assets		152.087	115.341	100.475
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	24.672	21.041	12.060
	Other Current Liabilities	20.155	16.227
	Provisions	6.361	4.574	4.299
Total Current Liabilities		51.188	41.842	16.359
Net Current Assets		100.899	73.499	84.116

MISCELLANEOUS EXPENSES		0.000	0.000	1.942

TOTAL		197.215	164.783	183.600

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2012	31.03.2011	31.03.2010
	SALES
		Revenue from Operations	330.781	288.883	190.654
		Other Income	0.185	0.096	0.209
		TOTAL (A)	330.966	288.979	190.863

Less	EXPENSES
		Cost of materials consumed	221.176	188.216	163.942
		Changes in inventories of finished goods, work in progress and stock-in-trade	(10.630)	4.178
		Employee Benefits Expenses	29.571	22.656
		Other Expenses	47.675	38.560
		TOTAL (B)	287.792	253.610	163.942

Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		43.174	35.369	26.921

Less	FINANCIAL EXPENSES (D)		19.982	13.698	12.264

	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		23.192	21.671	14.657

Less/ Add	DEPRECIATION/ AMORTISATION (F)		12.954	12.904	8.093

	PROFIT BEFORE TAX (E-F) (G)		10.238	8.767	6.564

Less	TAX (H)		3.369	(0.608)	6.384

	PROFIT AFTER TAX (G-H) (I)		6.869	9.375	0.180

	EARNINGS IN FOREIGN CURRENCY
		Export Sales	73.178	64.645	38.273
	TOTAL EARNINGS		73.178	64.645	38.273

	Earnings Per Share (Rs.)		2.37	3.23	0.06

Expected Sales (2012-2013): Rs.450.000 millions

The above information has been parted by Mr. Vinod (Accounts Manager).

KEY RATIOS

PARTICULARS		31.03.2012	31.03.2011	31.03.2010
PAT / Total Income	(%)	2.08	3.24	0.09

Net Profit Margin (PBT/Sales)	(%)	3.10	3.03	3.44

Return on Total Assets (PBT/Total Assets}	(%)	4.36	4.32	3.32

Return on Investment (ROI) (PBT/Networth)		0.18	0.17	0.16

Debt Equity Ratio (Total Liability/Networth)		3.27	3.01	3.75

Current Ratio (Current Asset/Current Liability)		2.97	2.76	6.14

LOCAL AGENCY FURTHER INFORMATION

Details of Sundry Creditors:

Particulars

31.03.2012

(Rs. in millions)

31.03.2011

(Rs. in millions)

31.03.2010

(Rs. in millions)

Sundry Creditors

24.672

21.041

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	Yes
10) Designation of contact person	Yes
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	Yes
15) Capital in the business	Yes
16) Details of sister concerns	No
17) Major suppliers	Yes
18) Major customers	Yes
19) Payments terms	Yes
20) Export / Import details (if applicable)	Yes
21) Market information	--
22) Litigations that the firm / promoter involved in	--
23) Banking Details	Yes
24) Banking facility details	Yes
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	Yes

PERFORMANCE:

During the year, the company has achieved gross turnover of Rs.330.781 millions as compared to the gross turnover of Rs.288.880 millions of last year at a growth rate of 14.5% and has earned Cash Profit of Rs.23.178 millions during this year as compared to Cash Profit of Rs.21.656 millions of proceeding year.

Bankers Charges Report as per Registry

Corporate identity number of the company	U25209MH2000PTC125209
Name of the company	SPECIALTY POLYFILMS (INDIA) PRIVATE LIMITED
Address of the registered office or of the principal place of business in India of the company	F-89, M.I.D.C. Area, Waluj, Aurangabad – 431 136, Maharashtra, India E-Mail: shantanu@specialty-films.com
This form is for	Modification of charge
Charge identification number of the modified	10008301
Type of charge	Immovable Property Book Debts Movable Property (not being pledge) Floating Charge Others (Personal Guarantee of Directors and Others)
Particular of charge holder	State Bank of India, Industrial Finance Branch, Jaggi’s Building, Kranti Chowk, Jalna Road, Aurangabad – 431 005, Maharashtra, India E-Mail: chopade.sbi.co.in@gmail.com
Nature of description of the instrument creating or modifying the charge	1. Supplemental Agreement of Loan Cum Hypothecation 2. Letter of Arrangement 3. Guarantee Agreement 4. Memorandum for recording extension of mortgage by deposit of title deeds
Date of instrument Creating the charge	24.10.2011
Amount secured by the charge	Rs.154.900 millions
Brief particulars of the principal terms an conditions and extent and operation of the charge	Rate of Interest: CC - Interest @ 5.50% above base rate which is presently 10.00% p.a. PER 15.50% with monthly rests TL I - PER-16.25%, TL II- 16.25%, TL -III-17.25% p.a. with monthly rests Terms of Repayment: CC - Repayable on Demand TL III - 57 installments : repayment in 57 monthly installments repayment in 6 monthly installments of Rs.0.200 million plus applicable interest repayment in 12 monthly installments of Rs.0.250 million plus applicable interest repayment in 12 monthly installments of Rs.0.300 million plus applicable interest repayment in 20 monthly installments of Rs.0.450 million plus applicable interest last installment of Rs.0.700 million Margin: Raw Materials : Raw Materials Imported and Indigenous - 25%, SFG - 35%, Finished Good - 30%, Domestic receivables - 30% Term Loan - 33%, LC - 25%, Bank Guarantees - 25% Extent and Operation of the charge: Exclusive first charge on fixed and current assets of the Company Others: 1. Personal guarantees of Mr. Shantanu Manohar Deshpande, Mrs. Asha Shantanu Deshpande, Mr. Shashank Manohar Deshpande 2. Assignment of LIC Policies (Surrender value of Rs .13 crores) in the name of Shri Shantanu Deshpande and Shashank Deshpande 3. Lien on STDR No 31115444936 for Rs.1.000 million issued at Industrial Finance Branch Aurangabad
Short particulars of the property charged	Hypothecation charge on stock of raw materials, goods in process, consumables, finished goods and book debts and all current assets Hypothecation of existing plant and machinery and plant and machinery purchased out of Term Loans sanctioned to the Company Extension of Equitable mortgage of all the piece and parcel of factory land and building bearing Plot No F-89, MIDC Waluj Aurangabad adm 1800 sq mtrs owned by Company Extension of Equitable mortgage of Plot No F-102, Waluj Industrial Area, Adm 5000 Sq mtrs Extension of Equitable mortgage of Independent Bungalow No 44 Kasliwal Marvel West Gut No 75/1, Beed By pass Road, Village Satara, Aurangabad Adm with built up area 1376 sq ft
Whether any of the property or interest therein under reference is not registered in the name of the company If yes, in whose name it is registered	Yes Properties in the name of Director
Date of latest modification prior to the present modification	10.03.2010
Particulars of the present modification	Enhancement in Overall Limit from Rs.122.400 millions to Rs.154.900 millions by increase in Cash Credit Limit of Rs.30.000 millions (Within CC Limit EPC of Rs.20.000 millions and Export Bill Discounting Limit of Rs.10.000 millions) and increase in LC Limit of Rs.1.500 millions and increase in Bank Guarantee Limit of Rs.1.000 million

TRADE REFERENCES:

v The Procter and Gamble Company

v Hindustan Coca-Cola
Beverages Private Limited

v Dow Chemical Company

FIXED ASSETS:

v Land

v Buildings

v Goodwill

v Electrical Installation

v Furniture and Fixtures

v Storage Racks

v Office Equipments

v Vehicles

v Plant and Machinery

v Computers etc.

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 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.55.09
UK Pound	1	Rs.89.54
Euro	1	Rs.72.77

INFORMATION DETAILS

Information Gathered by :	PJA

Report Prepared by :	SMN

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	3
PAID-UP CAPITAL	1~10	4
OPERATING SCALE	1~10	4
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	4
--PROFITABILIRY	1~10	3
--LIQUIDITY	1~10	3
--LEVERAGE	1~10	3
--RESERVES	1~10	3
--CREDIT LINES	1~10	3
--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	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		30

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.