MIRA INFORM REPORT

Report Date :

25.07.2012

IDENTIFICATION DETAILS

Name :	TAIKISHA ENGINEERING INDIA LIMITED (w.e.f. 01.07.1998)
Formerly Known As :	TAIKISHA ENGINEERING INDIA PRIVATE LIMITED
Registered Office :	14, Palam Marg, Vasant Vihar, New Delhi – 110057
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	24.02.1995
Com. Reg. No.:	55-065836
Capital Investment / Paid-up Capital :	Rs.6.000 Millions
CIN No.: [Company Identification No.]	U74999DL1995PLC065836
TAN No.: [Tax Deduction & Collection Account No.]	DELT01889G
PAN No.: [Permanent Account No.]	AAACT2634G
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturer and Exporter of Plant and Machinery for Automobile Industries.
No. of Employees :	450 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

Ba (51)

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

Maximum Credit Limit :	USD 2640000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is an established company having fine track. There appears some dip in the profitability of the company. However, general financial position of the company is good. Trade relations are reported as fair. Business is active. Payments are reported to be regular and as per commitments. The company can be considered normal for business dealings at usual trade term 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 DEFAILTERS’ LIST STATUS

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

EPF (Employee Provident Fund) DEFAILTERS’ 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 :	14, Palam Marg, Vasant Vihar, New Delhi – 110 057, India
Tel. No.:	91-11-26147101/ 26148671
Fax No.:	91-11-26148671
E-Mail :	s.pradeep@taikishaindia.com namakwana@taikishaindia.com
Website :	http://www.taikishaindia.com
Head Office/ Factory 1 :	Plot No. 404, Udyog Vihar, Phase-IV, Gurgaon -122 015, Haryana India
Tel. No.:	91-124-2348246/ 2455215/ 16
Fax No.:	91-124-2348246/ 2348247
E-Mail :	contact@taikishaindia.com
Factory 2 :	Sheet Metal Factory Gat No. 321/323, Village Kondapuri, Taluka-Shirur, District-Pune, Maharashtra, India
Tel. No.:	91-213-7270231
Factory 3 :	19, Sector III, IMT Manesar, Gurgaon – 122 051, Haryana, India
Tel. No.:	91-124-2290152/ 4669011
Fax No.:	91-124-2290153
Mumbai Office :	123-126, Building No.S-2, Vedant, Kores Road, Vartak Nagar, Thane – 400 606, Maharashtra, India
Tel. No.:	91-22-25885130/ 25885131/ 25885132
Fax No.:	91-22-25886133/ 25834793
E-Mail :	teimumbai@vsnl.net.in

DIRECTORS

(AS ON 14.09.2011)

Name :

Mr. Natwarlal Amrutlal Makwana

Designation :

Whole Time Director

Address :

“Astha”, Plot No.438, Sector 14, Gurgaon – 122 001, Haryana, India

Date of Birth/Age :

20.06.1940

Qualification :

BE Mechanical and Electrical

Date of Appointment :

24.02.1995

DIN No.:

00329059

Other Directorships :

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	Company/ LLP Status	Defaulting status
1	U27310GJ1980PTC003647	MULTI TECH ENGINEERING PRIVATE LIMITED	Director	15/04/1980	15/04/1980	Active	NO
2	U29100MH1983PTC031139	MARGO ENGINEERS PRIVATE LIMITED	Director	20/10/1983	20/10/1983	Active	NO
3	U74999DL1995PLC065836	TAIKISHA ENGINEERING INDIA LIMITED	Whole-time director	01/07/2010	24/02/1995	Active	NO
4	U34300PN1998PTC012837	SPECIALITY SINTERED PRODUCTS PRIVATE LIMITED	Director	03/09/1998	03/09/1998	Active	NO
5	U45205MH2000PTC128774	MES WATER MANAGEMENT PRIVATE LIMITED	Director	19/09/2000	19/09/2000	Active	NO
6	U74999MH2000PTC129254	MEMBRANE SYSTEM SPECIALISTS INDIA PRIVATE LIMITED	Director	19/10/2000	19/10/2000	Active	NO
7	U45200MH2007PTC167532	KAMALASHA INFRASTRUCTURE AND ENGINNERING PRIVATE LIMITED	Director	02/08/2010	19/11/2009	Active	NO

Name :

Mr. Etsuo Kawahara

Designation :

Director

Address :

9-3-51, Zaimoku-Cho, Aichi Pref, Okazaki City, Japan

Date of Birth/Age :

09.03.1951

Date of Appointment :

10.06.2004

DIN No.:

01070868

Name :

Mr. Masaaki Saito

Designation :

Director

Address :

1-1040-7, Owada-Saitama-Shi, Saitam, Japan

Date of Birth/Age :

23.10.1948

Date of Appointment :

01.08.2005

DIN No.:

01070909

Name :

Mr. Hemant N. Makwana

Designation :

Whole Time Director

Address :

“Astha”, Plot No.438, Sector 14, Gurgaon – 122 001, Haryana, India

Date of Birth/Age :

11.07.1972

Date of Appointment :

10.06.2004

DIN No.:

00329094

Other Directorships :

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	Company/ LLP Status	Defaulting status
1	U74999DL1995PLC065836	TAIKISHA ENGINEERING INDIA LIMITED	Whole-time director	11/06/2009	10/06/2004	Active	NO

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

(AS ON 14.09.2011)

Names of Shareholders	No. of Shares
Taikisha Limited, Japan	329997
Sumitomo Corporation, Japan	30000
Margo Engineers Private Limited, India	239998
Satoru Kamiyama	1
Hashimoto Kazunori	1
Masaaki Saito	1
Hemant N. Makwana	1
P. Shivraj	1
Total	600000

(AS ON 30.09.2011)

Equity Shares Break – up

Category	Percentage
Foreign holdings [Foreign institutional investors, Foreign Companies, Foreign Financial Institutions, Non-resident Indian or Overseas corporate bodies or others]	60.00
Bodies corporate	40.00
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer and Exporter of Plant and Machinery for Automobile Industries.

PRODUCTION STATUS (AS ON 31.03.2011)

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
Control Panel and Parts for own projects	Nos.	N.A.	N.A.	81
Control Panel for others	Nos.	N.A.	N.A.	Nil
PU Process Materials	Nos.	N.A.	N.A.	4
Fabricated Parts	Nos.	N.A.	N.A.	21

GENERAL INFORMATION

No. of Employees :

450 (Approximately)

Bankers :

Union Bank of India, Gurgaon Branch

Facilities :

Secured Loans	31.03.2011	31.03.2010
	(Rs. In Millions)
Rupee term loans banks secured	218.038	47.369
Loans taken for fixed assets secured	3.441	3.057
Total	221.479	50.426

Banking Relations :	--
Auditors :
Name :	Gupta Thapar and Company Chartered Accountants
Address :	D-53, Anand Niketan, New Delhi – 110 021, India
Tel. No.:	91-11-24118176/ 41661979
E-Mail :	guptathapar@yahoo.com
PAN No.:	AAKPG8803F
Enterprises over which key management personnel and their relatives are able to exercise significant influence:	v Multi Engineering Services v Margo Engineer Private Limited v Taikisha Limited, Japan v Multi Tech Engineers Private Limited v Progressive Engineering Services v Advantech Engineering Private Limited v Multi Engineering Industries v Hemant Enterprises

CAPITAL STRUCTURE

(AS ON 14.09.2011)

Authorised Capital :

No. of Shares	Type	Value	Amount
1000000	Equity Shares	Rs.10/- each	Rs.10.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
600000	Equity Shares	Rs.10/- each	Rs.6.000 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		6.000	6.000	6.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		654.242	621.193	574.070
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		660.242	627.193	580.070
LOAN FUNDS
1] Secured Loans		221.479	50.426	113.636
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		221.479	50.426	113.636
DEFERRED TAX LIABILITIES		5.467	4.762	5.430
TOTAL		887.188	682.381	699.136
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		266.089	222.760	184.358
Capital work-in-progress		8.788	3.603	2.383
INVESTMENT		245.393	59.628	46.879
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	187.058	72.930	77.413
	Sundry Debtors	553.969	302.375	459.319
	Cash & Bank Balances	200.234	286.319	244.461
	Other Current Assets	1.732	10.539	1.299
	Loans & Advances	227.471	169.372	145.301
Total Current Assets		1170.464	841.535	927.793
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditor	334.727	262.553	241.841
	Other Current Liabilities	409.016	98.491	179.497
	Provisions	59.803	84.100	40.939
Total Current Liabilities		803.546	445.144	462.277
Net Current Assets		366.918	396.390	465.516
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		887.188	682.381	699.136

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Sale	1233.647	1014.195	1088.312
		Interest on FDR’s	16.509	14.658	12.762
		Other Income	21.780	9.271	16.560
		TOTAL	1271.936	1038.124	1117.634
Less	EXPENSES
		Cost of Goods Sold	803.877	598.527	701.846
		Work Expenses	43.190	29.489	15.448
		Royalty Expenses	12.232	29.327	31.597
		Payments to Employees	125.747	105.156	104.227
		Administrative Expenses	144.153	107.004	114.522
		TOTAL	1129.199	869.503	967.640
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION		142.737	168.621	149.994
Less	FINANCIAL EXPENSES		14.685	11.252	34.782
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION		128.052	157.369	115.212
Less/ Add	DEPRECIATION/ AMORTISATION		36.665	29.273	24.120
	PROFIT/ LOSS BEFORE TAX AND EXCEPTIONAL ITEMS		91.387	128.096	91.092
Less	PRIOR PERIOD ADJUSTMENT		0.529	(1.140)	4.795
Add	EXCESS PROVISION OF WRITTEN OFF		2.192	0.000	0.000
	PROFIT BEFORE TAX		93.942	129.236	86.297
Less	TAX		31.289	44.358	34.523
	PROFIT AFTER TAX & BEFORE EXCEPTIONAL ITEMS		62.653	84.878	51.774
Less	EXCEPTIONAL ITEMS		0.219	(1.556)	2.648
	NET PROFIT		62.434	86.434	49.126
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		510.272	471.792	434.598
Less	APPROPRIATIONS
		Proposed Dividend	25.200	33.600	6.000
		Corporate Dividend Tax	4.185	5.710	1.020
		General Reserve	6.243	8.644	4.912
	BALANCE CARRIED TO THE B/S		537.078	510.272	471.792
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	12.830	11.468	11.803
	TOTAL EARNINGS		12.830	11.468	11.803
	IMPORTS
		Raw Materials	61.003	30.280	25.943
		Stores & Spare Parts	0.000	0.000	0.000
		Capital Goods	31.061	2.016	28.284
	TOTAL IMPORTS		92.064	32.296	54.227
	Earnings Per Share (Rs.)		104.06	144.06	81.88

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	4.91	8.33	4.11
Net Profit Margin (PBT/Sales)	(%)	7.61	12.74	7.93
Return on Total Assets (PBT/Total Assets}	(%)	6.54	12.14	7.76
Return on Investment (ROI) (PBT/Networth)		0.14	0.21	0.15
Debt Equity Ratio (Total Liability/Networth)		1.55	0.79	0.99
Current Ratio (Current Asset/Current Liability)		1.46	1.89	2.01

LOCAL AGENCY FURTHER INFORMATION

Check list by info Agents	Available in Report (Yes/ No)
Year of Establishment	Yes
Locality of the Firm	Yes
Constitution of the Firm	Yes
Premises details	No
Type of Business	Yes
Line of Business	Yes
Promoter’s Background	Yes
No. of Employees	Yes
Name of Person Contacted	No
Designation of Contact person	No
Turnover of Firm for last three years	Yes
Profitability for last three years	Yes
Reasons for variation <> 20%	-----
Estimation for coming financial year	No
Capital in the business	Yes
Details of sister concerns	Yes
Major Suppliers	No
Major Customers	No
Payments Terms	No
Export/ Imports Details (If applicable)	No
Market Information	-----
Litigations that the firm/ Promoters Involved in	-----
Banking details	Yes
Banking Facility Details	Yes
Conduct of the Banking Account	-----
Buyer visit details	-----
Financials, if provided	Yes
Incorporation details is applicable	Yes
Last Accounts filed at ROC	Yes
Major Shareholders, if available	Yes
PAN of Proprietor/Partner/Director, if available	No
Passport No of Proprietor/Partner/Director, if available	No
Voter ID No of Proprietor/Partner/Director, if available	No

OPERATIONS:

The sales turnover increased from Rs.1014.200 Millions to Rs.1233.600 Millions depicting a growth of around 22%. However, it fell short of the rather ambitious target of Rs.2000.000 Millions largely due to increased competition and delays in implementing fresh capacity expansion by automobile companies.

The depreciation and administrative expenses have gone up significantly due to the installation of the Pune laser cutting facility. The administrative expense increased from Rs.107.000 Millions to Rs.144.000 Millions resulting into lower profitability.

This year the Company has booked the Daimler project and the work of fabrication of the equipment has just started. The acquisition of the project involved lot of travelling for Chennai site and Germany resulting in high acquisition expenses. However, in order to develop relations with the European client and to penetrate new market, the Company decided to go all out for the project despite very stiff competition.

During the current financial year, the Company has booked good business and the expected turnover for FY 2011-12 is Rs.2500.000 Millions with a projected profit of Rs.300.000 Millions. The year gone by saw the company fighting tough competition from its competitors like Durr. The Company also lost one of the key orders of Tata Motors Dharwad project similar to Tata UTT project. Although we had submitted their best offer but finally project was awarded to Durr. Tata Motors communicated that the order had been allotted to Durr because of higher technology and knowhow.

The Company and the holding company, Taikisha, Japan. In order to avoid similar situation in future, the Company is required to have good R&D facility and fine-tune its sales strategy.

TEI PUNE FACTORY

The Company is making serious efforts to diversify from the paint shop to the allied line and they have already started laser cutting fabrication, etc. at Pune. We are also contemplating expansion of the Pune factory and at the same time also setting up a new factory at Vadodra, Gujarat, near Bombardier Company. This shall help us to cater to Bombardier as also other potential clients in and around that area. A piece of land of about 3 acres has already been purchased and the construction is likely to start very soon. The factory will start into two phases, first phase from April 2012 and the second phase from April 2013.

Once the Company has successfully completed both these Phases (I & II), not only this shall be a significant achievement but shall result into more stability for the Company’s operations. Presently, the Company is solely dependent upon paint shop business, which is not a very healthy position due to global and local uncertainties. Therefore, diversification is need of the hour for the Company.

TKS – GEICO ALLIANCE

Recently Taikisha, Japan and Geico has entered in international agreement where Taikisha Japan holding 51% and Geico hold 49%. This joint venture shall help to develop the business in India and also globally. The Company will be benefited and they shall get the opportunity to work with Geico. They believe that the Company will get additional new clients in India and show higher business growth, which is a very healthy positive development for them.

BUSINESS DIVERSIFICATION

Electrical Control Panel and Power Plant Installation – This business is very rapidly growing in India and they are studying and making continuous efforts for exploring suitable opportunities to proceed. The Company is also considering export business of electrical control panels and is taking very aggressive initiatives in this respect and also looking to develop proper channels for international marketing.

The Company has expertise in manufacturing and it is a very good time to encash the same. Presently they are using the Pune factory and after the start of work at the Vadodra factory, post December 2011, the Board shall focus on this subject in detail.

Delhi JNPT Freight Corridor Project – They have already made application for registration of their name since this is a big and prestigious project. There are many opportunities for the Company for works relating to air ventilation, piping, electrical control panel, power plant, etc. The Company has a good chance to bag business since the project has about 60% finance from the Japanese government and the remaining 40% from the Indian government agencies. Accordingly, Indo-Japanese joint ventures and companies with Japanese technology and backing, e.g., Taikisha India have good prospects in this new business opportunity.

CONTINGENT LIABILITIES NOT PROVIDED FOR:

Particulars	31.03.2011 (R. In Millions)	31.03.2010 (Rs. in millions)
Bank guarantees outstanding	614.148	47.229
Customer Claims	212.570	NIL

FIXED ASSETS:

· Land

· Building

· Furniture and Fixture

· Office Equipments

· Computer

· Plant and Machinery

· Tools

· Vehicles

· Temp Structure

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.56.02
UK Pound	1	Rs.86.89
Euro	1	Rs.67.84

INFORMATION DETAILS

Report Prepared by :

NIT

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	6
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	7
--CREDIT LINES	1~10	5
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		51

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	-

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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.