MIRA INFORM REPORT

Report Date :

09.02.2012

IDENTIFICATION DETAILS

Name :	FAZE-THREE LIMITED (w.e.f 15.07.2003)
Formerly Known As :	FAZE THREE EXPORTS LIMITED
Registered Office :	Survey No. 380/1, Khanvel Silvassa Road, Village Dapada, Dadra and Nagar Haveli – 396 191
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	09.01.1985
Com. Reg. No.:	54-000197
Capital Investment / Paid-up Capital :	Rs.121.888 Millions
CIN No.: [Company Identification No.]	L99999DN1985PLC000197
TAN No.: [Tax Deduction & Collection Account No.]	MUMM20088F
PAN No.: [Permanent Account No.]	AAACF2212N
Legal Form :	A Public Limited Liability Company. The Company’s Shares are Listed on the Stock Exchange.
Line of Business :	Manufacturing of Home Furnishing Items.
No. of Employees :	400 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

B (29)

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Maximum Credit Limit :	USD 2300000
Status :	Moderate
Payment Behaviour :	Slow
Litigation :	Clear
Comments :	Subject is an established company having moderate track. There appears a dip in the profitability of the company due to insolvency petition filed by the company’s wholly owned subsidiary in Germany namely Pana Textile GmbH. However, trade relations are reported as fair. Business is active. Payments are reported to be slow. The company can be considered for business dealings with some caution.

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 – September 30, 2011

Country Name	Previous Rating (30.06.2011)	Current Rating (30.09.2011)
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. Vinesh
Designation :	Account Executive
Contact No.:	91-22-24944854

LOCATIONS

Registered Office :	Survey No. 380/1, Khanvel Silvassa Road, Village Dapada, Dadra and Nagar Haveli – 396 191, India
Tel. No.:	91-260-2699323
Fax No.:	91-260-2699322
E-Mail :	secretarial@fazethree.com accounts@fazethree.com
Website :	http://www.fazethree.com
Location :	Owned
Head/ Corporate office :	1-2 Shiv Smriti Chambers, 49-A Dr Annie Besant Road, Worli, Mumbai- 400018, Maharashtra, India
Tel. No.:	91-22-24944854/66604600/24984176
Fax No.:	91-22-24936811
E-Mail :	info@fazethree.com investors@fazethree.com
Factory :	Hand Loom and Made –ups Plant · Jatal Road, Anand Nagar, Near Old CanalPanipat-132103, Haryana Weaving and Made – up Plants · Survey No. 380/1, Village Adapada, Unitary of Dadara and Nagar Havelli Bathmat Plant · Survey No. 356/1-2, Village Dadra, Unitary of Dadara and Nagar Havelli Dye House · Plot No. 71, GIDC, Vapi Industrial Area, Pardi, District Valsad, Gujarat, India

DIRECTORS

(AS ON 29.09.2011)

Name :

Mr. Ajay Brijlal Anand

Designation :

Chairman cum Managing Director

Address :

91,92, Ritu Apartment, 113, Dongershi Road, Walkeswar , Mumbai – 400006, Maharashtra, India

Date of Birth/Age :

16.10.1954

Date of Appointment :

09.01.1985

DIN No.:

00373248

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	L99999DN1985PLC000197	Faze-Three Limited	Managing director	01-10-10	09-01-85	-	Active	NO
2	U92100MH1954PTC009396	Joint Producers Private Limited	Director	25-03-91	25-03-91	-	Active	NO
3	U67120MH1991PTC060920	Instyle Investments Private Limited	Director	25-03-91	25-03-91	-	Active	NO
4	U67190MH1995PTC086260	Mamata Finvest Private Limited	Director	09-03-95	09-03-95	12-03-07	Active	NO
5	U99999MH1995PTC086281	Anadry Investments Private Limited	Director	13-03-95	13-03-95	12-03-07	Active	NO
6	U67120MH1995PTC086405	Hemambar Investments Private Limited	Director	15-03-95	15-03-95	12-03-07	Active	NO
7	L17120DN1997PLC000196	Aunde India Limited	Managing director	01-04-09	03-10-97	-	Active	NO
8	L51909MH1989PLC138292	V.R. Woodart Limited	Director	24-09-98	24-09-98	-	Active	NO
9	U51109WB1994PTC065109	NAC Travels Private Limited	Director	15-11-00	15-11-00	-	Active	NO
10	U92199MH2001PTC130974	Prana Studios Private Limited	Director	23-02-01	23-02-01	31-10-11	Active	NO
11	U51909MH2008PTC221482	Madhyam Vinimay Private Limited	Director	15-05-10	15-05-10	-	Active	NO

Name :

Mrs. Rashmi Ajay Anand

Designation :

Whole-time Director

Address :

91,92, Ritu Apartment, 113, Dongershi Road, Walkeswar , Mumbai – 400006, Maharashtra, India

Date of Birth/Age :

24.09.1958

Date of Appointment :

28.11.1996

DIN No.:

00366258

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	U92100MH1954PTC009396	Joint Producers Private Limited	Director	25-03-91	25-03-91	-	Active	NO
2	U67120MH1991PTC060920	Instyle Investments Private Limited	Director	25-03-91	25-03-91	-	Active	NO
3	U67190MH1995PTC086260	Mamata Finvest Private Limited	Director	09-03-95	09-03-95	12-11-07	Active	NO
4	U99999MH1995PTC086281	Anadry Investments Private Limited	Director	13-03-95	13-03-95	12-11-07	Active	NO
5	U67120MH1995PTC086405	Hemambar Investments Private Limited	Director	15-03-95	15-03-95	12-11-07	Active	NO
6	L99999DN1985PLC000197	Faze-Three Limited	Whole-time director	01-10-10	28-11-96	-	Active	NO
7	U51909MH2008PTC221482	Madhyam Vinimay Private Limited	Director	15-05-10	15-05-10	-	Active	NO

Name :

Mr. Sanjay Brijlal Anand

Designation :

Whole-time Director

Address :

Rishi Apartments, Bolck 4, Flat No. 6, 4 Battery Lane, Rajpur Road, Civil Lines, Delhi – 110054, India

Date of Birth/Age :

28.11.1961

Date of Appointment :

13.11.2001

DIN No.:

01367853

Other Directorship:

S.No.	CIN	Name of the Company	Current designation of the director	Date of appointment at current designation	Original date of appointment	Company Status	Defaulting status
1	L51909MH1989PLC138292	V.R. Woodart Limited	Director	24-09-98	24-09-98	Active	NO
2	L99999DN1985PLC000197	Faze-Three Limited	Whole-time director	01-12-09	13-11-01	Active	NO

Name :

Mr. Vasudeva Rao

Designation :

Director

Address :

Nachiketa 106, J.P. Road, Andheri (West), Mumbai – 400058, Maharashtra, India

Date of Birth/Age :

22.08.1939

Date of Appointment :

30.10.2002

DIN No.:

00465479

Name :

Mr. Rajiv Rai Sachdev

Designation :

Director

Address :

B 11, Commerce Centre, Tardeo, Mumbai – 400006, Maharashtra, India

Date of Birth/Age :

18.07.1955

Date of Appointment :

08.03.2004

DIN No.:

00910936

Other Directorship:

S.No.	CIN	Name of the Company	Current designation of the director	Date of appointment at current designation	Original date of appointment	Company Status	Defaulting status
1	U92110MH1969PTC014183	Trimurti Films Private Limited	Director	01-04-78	01-04-78	Active	NO
2	U32300MH1995PTC088540	Trimurti Sound Private Limited	Director	19-05-95	19-05-95	Strike off	NO
3	L99999DN1985PLC000197	Faze-Three Limited	Director	08-03-04	08-03-04	Active	NO

KEY EXECUTIVES

Name :	Mr. Martin John Golla
Designation :	Senior Vice President – Legal and Company Secretary
Address :	1704, 17^th Floor, Raheja Tipco Heights Towers, Rani Sati Marg, Malad (East), Mumbai – 400097, Maharashtra, India
Date of Birth/Age :	12.04.1966
Date of Appointment :	29.11.1999
Pan No.:	AADPG0587B
Name :	Mr. Vinesh
Designation :	Account Executive
Corporate Management :	· Mr. Ajay Anand · Mrs. Rashmi Anand · Mr. Sanjay Anand

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

(AS ON 31.12.2011)

Category of Shareholder	No. of Shares	Percentage
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	4,127,619	33.86
Bodies Corporate	2,439,125	20.01
Sub Total	6,566,744	53.88
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	6,566,744	53.88
(B) Public Shareholding
(1) Institutions
Venture Capital Funds	250	-
Sub Total	250	-
(2) Non-Institutions
Bodies Corporate	3,450,916	28.31
Individuals
Individual shareholders holding nominal share capital up to Rs.0.100 Million	1,436,133	11.78
Individual shareholders holding nominal share capital in excess of Rs.0.100 Million	664,270	5.45
Any Others (Specify)	70,484	0.58
Clearing Members	10,579	0.09
Non Resident Indians	59,905	0.49
Sub Total	5,621,803	46.12
Total Public shareholding (B)	5,622,053	46.12
Total (A)+(B)	12,188,797	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	-	-
(1) Promoter and Promoter Group	-	-
(2) Public	-	-
Sub Total	-	-
Total (A)+(B)+(C)	12,188,797	100.00

BUSINESS DETAILS

Line of Business :

Manufacturing of Home Furnishing Items.

Products :

Item Code No	Products Description
5514/ 5209	Woven Fabrics
5703	Carpets and Floor Coverings

PRODUCTION STATUS

Particulars	As on 31.03.2011
Installed Capacity Mtrs *	3,000,000
Pcs	2,400,000
Actual Production Mtrs *	1,557,598
Pcs	855,695

GENERAL INFORMATION

No. of Employees :

400 Approximately

Bankers :

Ø Canara Bank,

Prime Corporate Branch – II, Varma Chambers, 2^nd Floor, Homji Street, Fort, Mumbai – 400001, Maharashtra, India

Ø Allahabad Bank

Facilities :

Secured Loans	31.03.2011	31.03.2010
	(Rs. In Millions)
Term Loan	267.275	232.394
Short Term Loan	--	17.300
Packing Credit	475.745	472.898
Cash Credit	0.922	2.032
Bill Discounting	77.340	59.930
Other Loans (secured against hypothecation of Vehicles)	1.950	3.312
Total	823.232	787.866
Unsecured Loans	31.03.2011	31.03.2010
	(Rs. In Millions)
8000 1.5% Foreign Currency Convertible Bonds of USD 1000 each totaling to USD 8 Millions	348.720	348.720
Short Term Loan and Advances
From Company / Firms/ Others	127.298	114.551
From Director	15.193	2.797
Total	491.211	466.068

Banking Relations :	--
Auditors :
Name :	Thakur Vaidyanath Aiyar and Company Chartered Accountants
Address :	11-B, Vatsa House, Janmabhoomi Marg, Fort, Mumbai – 400001, Maharashtra, India
PAN.:	AAAFT3096M
Solicitors :
Name :	Vikram Philip and Associates Chartered Accountants
Subsidiaries :	· Faze Three Netherlands B.V · Pana Textile GMBH
Associates :	· V R Woodart Limited · Aunde India Limited · Instyle Investments Private Limited · Joint Producers Private Limited · Trimurti Films Private Limited

CAPITAL STRUCTURE

(AS ON 31.03.2011)

Authorised Capital :

No. of Shares	Type	Value	Amount
17000000	Equity Shares	Rs.10/- each	Rs.170.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
12188797	Equity Shares	Rs.10/- each	Rs.121.888 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		121.888	121.888	121.888
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		444.081	441.604	398.966
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		565.969	563.492	520.854
LOAN FUNDS
1] Secured Loans		823.232	787.866	707.691
2] Unsecured Loans		491.211	466.068	573.101
TOTAL BORROWING		1314.443	1253.934	1280.792
DEFERRED TAX LIABILITIES		102.368	102.368	102.368
TOTAL		1982.780	1919.794	1904.014
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		919.996	920.414	907.523
Capital work-in-progress		46.063	83.195	154.767
INVESTMENT		56.937	58.343	58.343
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	673.929	502.212	404.353
	Sundry Debtors	375.897	367.134	374.548
	Cash & Bank Balances	24.774	35.190	14.945
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	348.594	282.319	302.510
Total Current Assets		1423.194	1186.855	1096.356
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditor	343.289	233.874	239.499
	Other Current Liabilities	120.121	95.139	73.476
	Provisions	0.000	0.000	0.000
Total Current Liabilities		463.410	329.013	312.975
Net Current Assets		959.784	857.842	783.381
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		1982.780	1919.794	1904.014

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Sales	1232.396	1217.894	1391.162
		Other Income	283.510	162.688	117.340
		TOTAL (A)	1515.906	1380.582	1508.502
Less	EXPENSES
		Material Cost	695.506	636.119	689.420
		Employee Cost	149.563	129.313	123.554
		Operating Expenses	337.242	247.855	256.508
		Selling and Administration Expenses	239.330	220.793	226.985
		Foreign Exchange Fluctuation Loss	0.000	0.000	204.970
		Exceptional Items	42.047	0.000	0.000
		Increase/ (Decrease) in Stocks	(94.587)	(60.644)	36.925
		TOTAL (B)	1369.101	1173.436	1538.362
Less	PROFIT/LOSS BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		146.805	207.146	(29.860)
Less	FINANCIAL EXPENSES (D)		87.588	106.964	102.612
	PROFIT/LOSS BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		59.217	100.182	(132.472)
Less/ Add	DEPRECIATION/ AMORTISATION (F)		56.090	51.700	49.298
	PROFIT/LOSS BEFORE TAX (E-F) (G)		3.127	48.482	(181.770)
Less	TAX (H)		0.650	5.515	7.739
	PROFIT/LOSS AFTER TAX (G-H) (I)		2.477	42.967	(189.509)
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		42.967	0.000	25.645
Less	APPROPRIATIONS
		Transfer to General Reserve	0.000	0.000	(163.864)
	BALANCE CARRIED TO THE B/S		45.444	42.967	0.000
	EARNINGS IN FOREIGN CURRENCY		1180.543	1112.701	1279.429
	IMPORTS
		Raw Materials	0.000	49.855	81.239
		Stores & Spares	0.000	1.919	2.653
		Capital Goods	1.845	0.000	2.274
		Others	22.554	0.000	0.000
	TOTAL IMPORTS		24.399	51.774	86.166
	Earnings/loss Per Share (Rs.)		0.20	3.53	(15.55)

QUARTERLY RESULTS

PARTICULARS	30.06.2010	30.09.2010
Type	1^st Quarter	2^nd Quarter
Sales Turnover	555.060	461.850
Total Expenditure	489.170	409.790
PBIDT (Excl OI)	65.890	52.060
Other Income	0.000	0.000
Operating Profit	65.890	52.060
Interest	22.590	22.470
Exceptional Items	0.000	0.000
PBDT	43.300	29.590
Depreciation	15.840	10.770
Profit Before Tax	27.460	18.820
Tax	0.000	0.000
Reported PAT	27.460	18.820
Extraordinary Items	0.000	0.000
Prior Period Expenses	0.000	0.000
Other Adjustments	0.000	0.000
Net Profit	27.460	18.820

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	0.16	3.11	(12.56)
Net Profit Margin (PBT/Sales)	(%)	0.25	3.98	(13.07)
Return on Total Assets (PBT/Total Assets}	(%)	0.13	2.30	(9.07)
Return on Investment (ROI) (PBT/Networth)		0.01	0.09	(0.35)
Debt Equity Ratio (Total Liability/Networth)		3.14	2.81	3.06
Current Ratio (Current Asset/Current Liability)		3.07	3.61	3.50

LOCAL AGENCY FURTHER INFORMATION

COMPANY OPERATIONS:

The company has recorded a turnover of Rs.1232.396 Millions as against Rs. 1217.894 Millions during the previous year. The revenue from other income stood at 283.510 Millions as against Rs.162.688 Millions during the previous year. During the year, the Company has earned a profit before exceptional item and tax of Rs. 45.174 Millions against previous year's profit of Rs. 48.482 Millions. The profit after exceptional item of Rs. 42.047 Millions and tax of Rs.0.650 Million was Rs.2.477 Millions as against profit of Rs. 42.967 Millions during the previous year. The current year's performance was adversely affected on account of insolvency petition filed by the Company's wholly owned subsidiary in Germany viz. Pana Textil GmbH. Due to financial crisis in Europe and unfavorable market conditions, the subsidiary company has suffered enormous losses. Analyzing the European market conditions and to mitigate the further losses, the Board of Directors decided to file an insolvency petition in the German court.

Further, the Company has written-off the investments made and advances given to its wholly owned subsidiary companies viz. Faze Three Netherlands B. V. and Pana Textile GmbH. In the opinion of the Board of Directors Rs.42.074 Millions has been considered as write-off which has affected the profits of the Company.

BUSINESS OUTLOOK

The crisis in European and US markets have adversely affected the turnover of the Company. Being an export oriented Company, the Company is looking for new international markets and is rigorously trying to expand its existing market base in US and UK. The Company is looking at Brazil as an upcoming market for the company's products. As a result, the company is able to cope with the current market crisis in US and European Markets and sustain its sales and profitability.

Further, the Company is planning to increase its manufacturing capacities by augmenting additional manufacturing facilities with improved technology. The Company has also taken initiatives to improve the efficiency of the operating plants by implementing various methods like restructuring of product and procedures, better quality inspection, achieving projected sales by which the company is able to optimize the utilization of production capacities and increase its profitability in the current year.

SUBSIDIARY COMPANY:

The Ministry of Corporate Affairs has issued direction under section 212 (8) of the Companies Act, 1956 vide general circular No. 2/ 2011 dated February 8, 2011 and in accordance with the same, the Balance Sheet, the Profit and Loss Account and other documents of the subsidiary companies are not being attached with the Balance Sheet of the Company.

The wholly owned subsidiary of the Company of M/s Pana Textil GmbH has filed an insolvency petition in German Court. The German Court has accepted the petition and Insolvency Administrator has been appointed. The insolvency proceedings are in progress.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

INDUSTRY OVERVIEW AND OUTLOOK

The textiles industry in India enjoys a distinctive position due to the pivotal role it plays by way of contribution to industrial output, employment generation and export earnings of the country. The industry currently contributes about 14 per cent to industrial production, 4 per cent to GDP, and 17 per cent to the country's export earnings, according to the Annual Report 2010-11 of the Ministry of Textiles. The industry accounts for nearly 12 per cent share of the country's total exports.

India is potentially one of the strongest emerging global destinations for not only cotton bath and accent rugs but also synthetic and woolen product. Large Indian manufacturers have realized the potential of influencing a shift in the USD 400 million bath rug business. With the anticipated global shift of rug manufacturing to the East, India is currently among the first countries to have perceived this shift and already has world class manufacturing units in place with capacities matching the requirement of global retailers.

FTL's key export markets are US and UK, which together constitutes 79% of the total exports. To expand the markets in US and UK, FTL has increased its manufacturing capacities by optimum utilization of existing plant and machinery.

With the Research and Development activities in design development, quality standardization and innovation in features of various products, the company is confident to create new markets to its products and to grab every new opportunity in the home textile segment.

CONTINGENT LIABILITY

Particulars	31.03.2011	31.03.2010	31.03.2009
	(Rs. In Millions)
Bills Discounting	40.314	59.930	94.048
Bang Guarantee	2.625	2.625	2.625
Foreign/ Inland Letter of Credit	15.475	42.016	13.325
Corporate Guarantee in respect of Loan of Euro 4 min granted by Canara Bank London to subsidiary Pana Textile Gmbh. The said guarantee has been invoked and liability if any will be crystallized on completion of insolvency proceedings of Pana Textile Gmbh	252.440	241.800	--

UNAUDITED FINANCIAL RESULT FOR THE QUARTER ENDED 30.09.2011

Rs. in Millions

Particular	Quarter Ended		Half Year Ended
	Un – Audited		Un – Audited
	31.09.2011	31.09.2010	31.09.2011	31.09.2010
Gross Sales/ Income From operation	461.850	348.863	1016.912	679.551
Other Operating Income	0.000	0.000	0.000	0.000
Expenditure	461.850	348.863	1016.912	679.551
(Increase) / Decrease in stock in trade and work in progress
Progress	7.940	(6.270)	56.331	(1.204)
Consumption of raw materials	209.825	168.986	432.563	321.140
Employee Cost	37.603	29.249	74.205	61.926
Depreciation	10.765	12.720	26.603	25.440
Other expenditure	161.579	114.800	335.876	215.675
Total	420.566	319.485	925.578	622.977
Profit from operations before other income, interest and exceptional Items	41.284	29.378	91.334	56.574
Other income	0.000	0.000	0.000	0.000
Profit before interest and exceptional Items	41.284	29.378	91.334	56.574
Interest	22.467	23.836	45.050	48.521
Profit after Interest but before Exceptional Items	18.817	5.542	46.284	8.053
Exceptional Items	0.000	0.000	0.000	0.000
Profit (+)/Loss(-) from Oridinary Activities before tax	18.817	5.542	46.284	8.053
Tax expense	0.000	1.150	0.000	1.450
Prior Period Expenses	0.000	0.000	0.000	0.000
Net Profit (+)/Loss(-) from Ordinary Activities after tax	18.817	4.392	46.284	6.603
Extraordinary items	0.000	0.000	0.000	0.000
Net Profit (+) / Loss (-) for the year period	18.817	4.392	46.284	6.603
Paid up equity share capital (Face value of Rs.10/- per share)	121.888	121.888	121.888	121.888
Reserves excluding revaluation reserves as per balance sheet of previous accounting year	-	-	-	444.081
Earning per share (EPS)
(a) Basic and diluted EPS before Extraordinary items for the period, for the year to date and for the previous year (not to be annualised)	1.54	0.36	3.80	0.54
(a) Basic and diluted EPS before Extraordinary items for the period, for the year to date and for the previous year (not to be annualised)	1.54	0.36	3.80	0.54
Public shareholding
Number of shares	6829963	6829963	6829963	6829963
Percentage of shareholding	56.03%	56.03%	56.03%	56.03%
Promoters and Promoters group Shareholding-
a) Pledged /Encumbered
Number of shares	5358834	5358834	5358834	5358834
Percentage of shares	-	-	-	-
b) Non Encumbered
Number of shares	5358834	5358834	5358834	5358834
Percentage of shares	43.97%	43.97%	43.97%	43.97%

Statement of Assets and Liabilities

(Rs. in millions)

Particulars	Un – Audited
	30.09.2011	30.09.2010
Shareholders’ Funds
(a) Capital	121.887	121.887
(b) Reserves and Surplus	490.366	448.209
Loan Funds	1345.568	1297.220
Deferred Tax Liabilities	102.368	102.368
Total	2060.189	1969.684
Fixed Assets	943.806	983.727
Investments	56.937	58.150
Current Assets, Loans and Advances
(a) Inventories	620.514	499.548
(b) Sundry Debtors	483.307	368.083
(C) Cash and Bank balances	16.738	13.154
(e) Loans and Advances	407.821	328.822
TOTAL	1528.380	1209.607
Less : Current Liabilities and Provisions
(a) Current Liabilities and Provisions	468.934	281.800
TOTAL	468.934	281.800
Net Current Assets	1059.446	927.807
Total	2060.189	1969.684

NOTES:

1 The above results were reviewed by the Audit committee and taken on record by the Board of Directors of the Company at their respecitve meetings held on 15th November 2011 .The Statutory Auditors of the Company have carried out a Limited Review of the above results.

2 None of the Subsidiaries have been considered in the above results

3 During the quarter the Company’s transaction has been only in the segment of manufacturing viz Home Furnishing

4 Current Tax and Deferred Tax for the current period would be considered in the audited accounts at the end of the year.

5 The current market price of the company’s equity shares being less than the conversion price in respect of the FCCB, the option embedded in the said bonds to convert them into equity shares is, at present taken to be anti-dilutive.

6 Complaints at the beginning of the quarter: NIL, received during the quarter & disposed off during the quarter: 2 and lying unresolved at the end of the quarter: NIL

7 The figures have been re-grouped/ re-classified wherever necessary.

FORM 8

Corporate identity number of the company	L99999DN1985PLC000197
Name of the company	FAZE-THREE LTD
Address of the registered office or of the principal place of business in India of the company	Survey No. 380/1, Khanvel Silvassa Road, Village Dapada, Dadra and Nagar Haveli – 396 191, India Email : secretarial@fazethree.com
This form is for	Modification of charge
Charge identification (ID) number of the charge to be modified	90234419
Type of charge	Book Debts Movable Property (not being pledge)
Particular of charge holder	Canara Bank, Prime Corporate Branch – II, Varma Chambers, 2^nd Floor, Homji Street, Fort, Mumbai – 400001, Maharashtra, India Email : managermcity02309@canbank.co.in
Nature of instrument creating charge	Supplement Joint deed of hypothecation
Date of instrument Creating the charge	02.09.2011
Amount secured by the charge	Rs. 1246.200 Millions
Brief of the principal terms an conditions and extent and operation of the charge	Rate of Interest: As stipulated by the consortium member banks in their sanction letter(s) and as advised from time to time plus service charges as are applicable to the credit facilities from time to time. Terms of Repayment: As stipulated by the consortium member banks in their sanction letter(s) and as advised from time to time plus service charges as are applicable to the credit facilities from time to time. Margin: As stipulated by the consortium member banks in their sanction letter(s) and as advised from time to time plus service charges as are applicable to the credit facilities from time to time. Extent and operation of charge: 1/ Charge over current assets shall rank on 1st pari passu basis in fevour of Canara Bank Consortium jointly and to each of them severally for the due repayment and discharge on demand of the working capital facilities (WCF) to the member banks t/w interest, costs, charges, expenses etc. 2/ Charge over entire movable fixed assets (excl. those of Worli Property, exclusively available to Canara Bank to the extent of Rs.622.500 millions) shall rank on 2nd pari passu basis for the WCF granted by the Canara Bank Consortium. Others : 1/ Canara Bank is designated and recognised as the Lead Bank of the Canara Bank Consortium, while Allahabad Bank is designated and recognised as the member bank of the Canara bank Consortium. 2/ Security created in respect of the fund based and non fund based credit facilites: - Granted by Canara Bank Rs.622.500 millions - Granted by Allahabad Bank Rs. 75.000 millions Total... Rs. 697.500 Millions
Short particulars of the property or asset(s) charged (including complete address and location of the property)	The whole of the current assets namely stocks of raw materials, stock in process, semi finished and finished goods, stores and spares not relating to plant and machinery (consumable stores and spares), bills receivable and book debts all other movables (excluding such movables as are permitted by the said Banks from time to time), but including documents of title to goods and other assets, such as outstanding moneys, receivables, claims, bills, invoice, documents, contracts, engagements, securities, investments and rights, both present and future of the company at Mumbai / Silvassa / Dadra / Dapada / Panipat and where so ever in India being and lying in the company's premises or godowns or or rented and whether lying loose or in cases or otherwise used in the business of the company at the said site or in transit not belonging to or that may at any time, belong to the company or that may be held by any party to the order or disposition of the company or in the course of transit or on high seas or on order or delivery, howsoever and where so ever in the possession of the company and either by way of substitution or addition. Entire movable fixed assets (excluding those of worli property, exclusively available in favour of Canara Bank)
Date of instrument modifying the charge	10.01.2011
Particulars of the present modification	(i) Total amount secured now stands reduced frm Rs.740.000 millions to Rs.697.500 millions granted under Working Capital Consortium on 1st pari passu basis against current assets and 2nd pari passu basis against movable fixed assets (excluding those of worli property, exclusively available to Canara Bank) b/w Canara Bank and Allahabad Bank for Rs.622.500 millions and Rs.75.000 millions respectively (ii) However, the charge over properties (excluding Worli Property) continue to remain unchanged at Rs.1246.200 millions and more particularly.

FIXED ASSETS

Ø Land – Freehold

Ø Land – Leasehold

Ø Building

Ø Plant and Machinery

Ø Furniture and Fixtures

Ø Office Equipments

Ø Electrical Installations

Ø Vehicles

Ø Computers

BUSINESS DESCRIPTION

Subject is an India-based company. The Company is engaged in manufacturing of home furnishing items. The Company offers its products in two categories: home furnishings and automotive textiles. It exports its merchandise to stores outlets in Australia, Belgium, Canada, France, Japan, Germany, North Ireland, Mexico, New Zealand, Sweden, the United Arab Emirates, the United Kingdom, and the United States. The home furnishings include bathmats, blankets and throws, floor coverings, carpets, cushions, curtains, tablemats and placemats. The Company offers a range of throws woven in cotton and cotton blends, chenille, boucle yarns, and other fancy yarns. It designs and manufactures a range of floor coverings, such as rugs and durries woven in cotton, chenille, jute and grass. The Company's carpet division manufactures hand stuffed and woven carpets. The wholly owned subsidiary of the Company is Faze Three Netherlands B.V. For the fiscal year ended 31 March 2009, Faze Three Ltd revenues increased 21% to RS1.51B. Net loss totaled RS190.3M, vs income of RS50M. Revenues reflect an increase in income from operations. Net income was offset by an increase in consumption of raw materials, higher employees costs, an increase in depreciation expenses, increased interest expenses, higher operating expenditures and an increase Administrative expenses.

BOARD OF DIRECTOR

KISHORE MADHAV MAHIMKAR - NON-EXECUTIVE INDEPENDENT DIRECTOR

Mr. Kishore Madhav Mahimkar serves as Non-Executive Independent Director of Subject. He is a Solicitor by profession and has been associated with the Company for quite a long time and has been highly instrumental in advising on Corporate Law affairs of the Company.

VASUDEVA RAO NON-EXECUTIVE INDEPENDENT DIRECTOR

Mr. Vasudeva Rao serves as Non-Executive Independent Director of subject. He is a well-known Chartered Accountant having experience in the Finance Sector. He helped the Company in advising on corporate and tax matters.

RAJIV RAI SACHDEV - NON-EXECUTIVE INDEPENDENT DIRECTOR

Mr. Rajiv Rai Sachdev serves as Non-Executive Independent Director of Subject. He is a B.A. Graduate. He has Experience in Entertainment and Advertising Industry.

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.48.68
UK Pound	1	Rs.76.75
Euro	1	Rs.63.57

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	4
PAID-UP CAPITAL	1~10	3
OPERATING SCALE	1~10	3
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	3
--PROFITABILIRY	1~10	3
--LIQUIDITY	1~10	3
--LEVERAGE	1~10	3
--RESERVES	1~10	4
--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	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		29

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.