MIRA INFORM REPORT

Report Date :

29.02.2012

IDENTIFICATION DETAILS

Name :	RESONANCE LABORATORIES PRIVATE LIMITED
Registered Office :	No. 832, 37^th Cross, 22^nd Main, 4^th T Block, Jayanagar, Bangalore-560041, Karnataka, India.
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	10.10.1980
Com. Reg. No.:	08-045343
Capital Investment / Paid-up Capital :	Rs. 1.012 Millions
CIN No.: [Company Identification No.]	U24110KA1980PTC045343
TAN No.: [Tax Deduction & Collection Account No.]	BLRR00291E
PAN No.: [Permanent Account No.]	AAACR7005B
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacturer of Drugs and Medicines
No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

Ba (54)

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

Maximum Credit Limit :	USD 1000000
Status :	Satisfactory
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is an old and well established company having satisfactory track. Financial position of the company appears to be sound. Trade relations are reported as fair. Business is active. Payment are reported to be regular and as per commitments. The company can be considered good for normal 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 – 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

LOCATIONS

Registered Office :	No. 832, 37^th Cross, 22^nd Main, 4^th T Block, Jayanagar, Bangalore-560041, Karnataka, India.
Tel. No.:	91-80-2245 5849
Fax No.:	91-80-2245 5056
E-Mail :	office@resonance-labs.com
Overseas Office :	2001, Route 46, Suite 310, Parsippany, NJ 07054, USA.
Tel. No.:	+1 973 433 3365
Fax No.:	+1 973 433 3121

DIRECTORS

As on 19.08.2011

Name :

Mr. Kallyanpur Sanjivrao Mohanrao

Designation :

Director

Address :

64, Yugharma, off Link Road, Off Inorbit, Goregaon (West) -400104, Maharashtra, India.

Date of Birth/Age :

26.01.1938

Date of Appointment :

03.11.2010

DIN No.:

00188485

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	U01549KA1984PTC006073	ACE FOODS PRIVATE LIMITED	Director	18/03/1985	18/03/1985	-	Active	NO
2	U24110KA1980PTC045343	RESONANCE LABORATORIES PRIVATE LIMITED	Director	3/11/2010	3/11/2010	-	Active	NO

Name :

Mr. Subbaswami Nanjundiah Kumbale

Designation :

Director

Address :

1050, 36^th Cross, 28^th Main, 4^th T Block, Jayanagar, Bangalore, Karnataka- 560041, India.

Date of Birth/Age :

26.06.1939

Date of Appointment :

14.03.1985

DIN No.:

01358207

Name :

Mr. Tushar Balkrishna Gore

Designation :

Director

Address :

70 B 4, Alok Prabhat Road, Lane 15, Pune-411004, Maharashtra, India.

Date of Birth/Age :

17.10.1972

Date of Appointment :

26.02.2009

DIN No.:

02536575

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 19.08.2011

Names of Shareholders	No. of Shares
K N Subbaswami	2924
Ramya S Kumbale	1
K N Subbaswami and Ramya S Kumbale	7200
Total	10125

Equity Share Break up (Percentage of Total Equity)

As on : 19.08.2011

Category	Percentage
Directors or relatives of Directors	100.00
Total	100.00

BUSINESS DETAILS

Line of Business :	Manufacturer of Drugs and Medicines
Products :	· Pharmaceutical Drugs · Intermediates · Specialty Chemicals

PRODUCTION STATUS

As on 31.03.2011

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
API’s ( Pharmaceutical Drugs )	Kgs	-	-	1976
Intermediates	Kgs	-	-	2

GENERAL INFORMATION

Customers :	· Novartis · Apotex · Sanofi Aventis · Gsk · Ciba · Basf · Glopec
No. of Employees :	Not Available
Bankers :	Not Available

Banking Relations :	--
Auditors :
Name :	Kadur and Company Chartered Accountant
Address :	IV Floor, Chitrapur Bhavan, 8^th Main, 15^th Cross, Malleshwaram, Bangalore- 560055, Karnataka, India.
PAN.:	ABAPK4894K
Subsidiary Company :	Resonance Labs Inc, USA.

CAPITAL STRUCTURE

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
23000	Equity Shares	Rs.100/- each	Rs. 2.300 Millions
2000	Unclassified shares	Rs.100/- each	Rs. 0.200 Millions
	Total		Rs. 2.500 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
10125	Equity Shares	Rs.100/- each	Rs. 1.012 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		1.012	1.012	1.012
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		264.181	261.698	246.015
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		265.193	262.710	247.027
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		2.294	2.873	3.189
TOTAL		267.487	265.583	250.216
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		35.580	39.275	38.436
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		5.022	5.022	0.005
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	7.210	3.657	39.172
	Sundry Debtors	1.342	4.345	24.664
	Cash & Bank Balances	206.413	194.437	162.742
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	15.824	25.144	25.272
Total Current Assets		230.789	227.583	251.850
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	1.202	3.349	35.543
	Other Current Liabilities	2.319	2.731	4.448
	Provisions	0.383	0.217	0.084
Total Current Liabilities		3.904	6.297	40.075
Net Current Assets		226.885	221.286	211.775
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		267.487	265.583	250.216

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Income
		Other Income
		TOTAL	59.230	122.731	128.277
Less	EXPENSES
		Office Expenses
		Administrative Expenses
		Advertising Expenses
		TOTAL	55.878	99.056	97.549
	PROFIT BEFORE TAX		3.352	23.675	30.728
Less	TAX		0.810	7.823	9.277
	PROFIT AFTER TAX		2.542	15.852	21.451
	EARNINGS IN FOREIGN CURRENCY
		Direct	11.460	84.180	78.332
		Freight	0.170	0.607	0.540
	TOTAL EARNINGS		11.630	84.787	78.872
	IMPORTS
		Raw Materials	Nil	0.834	59.322
	TOTAL IMPORTS		Nil	0.834	59.322
	Earnings Per Share (Rs.)		245.28	1548.90	2293.39

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	4.29	12.91	16.72
Return on Total Assets (PBT/Total Assets}	(%)	1.26	8.87	10.60
Return on Investment (ROI) (PBT/Networth)		0.01	0.09	0.12
Debt Equity Ratio (Total Liability/Networth)		0.01	0.02	0.16
Current Ratio (Current Asset/Current Liability)		59.12	36.14	6.28

LOCAL AGENCY FURTHER INFORMATION

NOTE:

The registered Office of the company has been shifted from 73, Alaknanda Gulmohar Cross RD. No 10, J.V.P.D Vile Parle (w), Mumbai-400049, Maharashtra, India to the present address w.e.f 30.01.2008.

FINANCIAL RESULTS:

The Turnover for the year was Rs. 48.287 Millions as compared to Rs. 110.177 Millions during the previous year. The overall activities during the year resulted in Net Profit of Rs.2.541 Millions (previous year Rs.15.582 Millions) after charging for depreciation and taxes of Rs.4.106 Millions and Rs,1.389 Millions (previous year Rs.4.105 millions & Rs.8.407 Millions) respectively.

OPERATIONS:

The year 2009 - 2010 in the bulk drug and specialty chemicals industry remained highly turbulent The competition within the country and from exports turned the bulk drug business lack luster- Global regulatory enforcement, consequent documentation as also the global economic downturn has put great pressure on the working of the industry. Resonance is a part of this effect.

The Company's operations and consequently the operating results suffered because of continuing regulatory issues to Novartis Animal Health product. Not withstanding this, considering the nature and GMP requirements of the industry, plant maintenance received due attention. While this gives a temporary respite to GMP demands, the Company has to consider setting up newer facilities, to fulfill the needs of the industry that Resonance is in. The Company's performance suffered also because of the closure of business with Ciba Specialty Chemicals Inc. Switzerland, consequent upon the acquisition of Ciba by BASF, Germany. Ciba no longer exists.

The company remained focused in the operations in high tech areas with continued efforts in R & D, process and business development. Expansion to R & D activities is receiving management attention.

Subsidiary Company:

Resonance Labs Inc established in New Jersey, USA is functioning well and is working towards opening up further export opportunities.

Fixed Assets:

· Free Hold Land

· Lease Hold Land

· Free Hold buildings

· Plant and Machinery

· Motor Vehicles

· Motor Car

· Furniture and fixtures

· Office Equipments

· Electrical Installations

· Typewriters

· 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] 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.49.14
UK Pound	1	Rs.77.86
Euro	1	Rs.66.06

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	7
--LEVERAGE	1~10	7
--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	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		54

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.