MIRA INFORM REPORT

Report Date :

24.07.2012

IDENTIFICATION DETAILS

Name :	TELCO CONSTRUCTION EQUIPMENT COMPANY LIMITED
Registered Office :	Jubilee Building, 45, Museum Road, Bangalore – 560 025, Karnataka
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	30.12.1998
Com. Reg. No.:	08-024588
Capital Investment / Paid-up Capital :	Rs.1000.000 millions
CIN No.: [Company Identification No.]	U85110KA1998PLC024588
TAN No.: [Tax Deduction & Collection Account No.]	BLRT02428G
PAN No.: [Permanent Account No.]	AAACT9077B
Legal Form :	It is a closely held public limited liability company.
Line of Business :	Manufacturing and Exporter of construction equipments and earth moving equipments.
No. of Employees :	1055 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

A (64)

RATING		STATUS	PROPOSED CREDIT LINE
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large

Maximum Credit Limit :	USD 28000000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Exist
Comments :	Subject is a well established and reputed company having fine track. There appears some dip in the profitability of the company. However, available information indicates high financial responsibility of the company. Trade relations are reported as fair. Business is active. Payments 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 – 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

EXTERNAL AGENCY RATING

Agency Name	Rating
ICRA	LAA

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 :	Jubilee Building, 45, Museum Road, Bangalore - 560025, Karnataka, India
Tel. No.:	91-80-25588026/25583345/46/53/ 66953301/02/03
Fax No.:	91-80-25583343/ 66953309
E-Mail :	telcon@telcon.co.in marketing.group@telcon.co.in
Website :	http://www.telcon.co.in
Area :	15000 sq. ft
Location :	Leased
Administrative office:	27^th Floor, Centre I, World Trade Centre, Cuffe Parade, Mumbai - 400005, Maharashtra
Tel. No.:	91-22-22160871
Fax No.:	91-22-22185747
Zonal offices :	Located at : Ahmedabad Aurangabad Bhubaneswar Bilaspur Chandigarh Chennai Cochin Dhanbad Goa Gulbarga Guwahati Hospet Indore Jaipur Jamshedpur Kolhapur Lucknow Nellore Pune Rajkot Salem Udaipur Vijaywada Vizag
Overseas office:	Nitol Motors Limited, Nitol Centre, 71 A, Mohakali Commercial Area, Dhaka, 1212, Bangladesh, India Tel. No. 00880-2-9887074/76 Fax. No. 00880-2-9883121/9887072 E-mail. nita@citechco.net Contact Person - Mr. Mohammad Aytollah / Mr. N. Ramchandran Access Tower, 278 Union Placa, Colombo, Colombo 02, Sri Lanka, India Tel. No. 0094-1-302302 Fax. No. 0094-1-302333/302346 E-mail. ajitten@access.lk/sumal@access.lk Contact Person - Mr. Sumal Perera Kathmandu, 999 999, Nepal, India Tel. No. 00977-1-520320/3/526357 Fax. No. 00977-1-26670 E-mail. paka@mos.com.np Contact Person - Mr. Badri Shreshtha
Factory :	C/O Tata Moters/ Telco Works, Jamshedpur-831010, Bihar, India KIADB, Block No : 2, Belur Industrial Estate, Mummigatti, Dharwad - 580007, Karnataka, India Email: ganapathi.mani@telcon.co.in
Area :	100 acre
Location :	Owned
Branch Office :	Located at : Bangalore Kolkata Hyderabad Mumbai New Delhi Nagpur

DIRECTORS

As on 27.06.2011

Name :	Mr. Ranaveer Sinha
Designation :	Managing Director
Address :	G5, Golmuri Road, Nildih, PO Golmuri, Jamshedpur – 831003, India
Date of Birth/Age :	09.07.1954
Qualification :	PGDBM, BE (IIT Kharagpur), MS (Aston University)
Date of Appointment :	01.01.2003
DIN No.:	00103398

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	U85110KA1998PLC024588	TELCO CONSTRUCTION EQUIPMENT COMPANY LIMITED	Managing director	1/1/2008	22/12/2002	-	Active	NO
2	U45203KA2003PTC032752	TELCON ECOROAD RESURFACES PRIVATE LIMITED	Nominee director	17/10/2003	17/10/2003	-	Active	NO
3	L74210JH1962PLC000700	TRF LIMITED	Director	18/03/2004	18/03/2004	-	Active	NO

Name :	Mr. Kamalesh Chandra Dewan Wazirchand Mehra
Designation :	Non Executive Director
Address :	Flat # 11, Volkart House, 63 Westfield Lane, Bhulabai Desai Road, Mumbai – 400021, Maharashtra, India
Date of Birth/Age :	20.09.1939
Qualification :	Hon. Graduate in Arts
Date of Appointment :	29.09.1999
DIN No.:	00005685

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	L17110MH1919PLC000628	FORBES AND COMPANY LIMITED	Managing director	1/4/2007	1/4/1997	31/03/2008	Active	NO
2	L24202MH1920PLC000825	KANSAI NEROLAC PAINTS LIMITED	Director	12/6/1997	12/6/1997	30/01/2007	Active	NO
3	U85100MH1946GAP005082	BREACH CANDY HOSPITAL TRUST	Director	31/07/1997	31/07/1997	3/4/2008	Active	NO
4	U25209TZ1995PLC015238	NYPRO FORBES PRODUCTS LIMITED	Director	18/09/1997	18/09/1997	1/12/2008	Active	NO
5	U55100MH1977PLC019660	FORVOL INTERNATIONAL SERVICES LIMITED	Director	19/08/1998	19/08/1998	-	Active	NO
6	U27109WB1931PLC007010	EUREKA FORBES LIMITED	Director	28/05/1999	28/05/1999	25/06/2008	Active	NO
7	U85110KA1998PLC024588	TELCO CONSTRUCTION EQUIPMENT COMPANY LIMITED	Director	29/09/1999	29/09/1999	-	Active	NO
8	U67120MH1974PLC017434	FORBES CAMPBELL HOLDINGS LIMITED	Director	27/03/2001	27/03/2001	-	Amalgamated	NO
9	U70200MH2003PLC139672	NUEVO CONSULTANCY SERVICES LIMITED	Director	28/03/2003	28/03/2003	31/07/2007	Active	NO
10	L29130MH1961PLC011980	SKF INDIA LIMITED	Director	24/04/2003	24/04/2003	-	Active	NO
11	U24232PN2003PTC017981	SOVEREIGN PHARMA PRIVATE LIMITED	Director	28/05/2003	28/05/2003	12/2/2009	Active	NO
12	U63090MH1920PLC000808	VOLKART FLEMING SHIPPING AND SERVICES LIMITED	Director	27/02/2004	27/02/2004	31/03/2008	Active	NO
13	U22100MH2004PLC149173	NEXT GEN PUBLISHING LIMITED	Director	31/01/2005	31/01/2005	-	Active	NO
14	U29290MH1991PLC062425	FORBES TECHNOSYS LIMITED	Director	28/07/2005	28/07/2005	31/07/2007	Active	NO
15	U72900MH2005PLC157375	FORBES EDUMETRY LIMITED	Director	19/12/2005	19/12/2005	3/11/2008	Active	NO
16	U61100MH2006PLC163149	SCI FORBES LIMITED	Director	18/07/2006	18/07/2006	4/9/2007	Active	NO
17	L17116KA2006PLC038839	GOKAK TEXTILES LIMITED	Director	29/11/2006	29/11/2006	9/8/2007	Active	NO

Name :	Mr. Shoji Iino
Designation :	Nominee Director
Address :	4-1-33 Shibasakidai, Abiko-Shi, Chiba 2701176
Date of Birth/Age :	11.07.1957
Qualification :	Graduate in Science and Technology, Waseda University
Date of Appointment :	01.04.2011
DIN No.:	01680590

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	U85110KA1998PLC024588	TELCO CONSTRUCTION EQUIPMENT COMPANY LIMITED	Nominee director	1/4/2011	3/5/2005	-	Active	NO
2	U74991WB2011PTC161572	TORO PROCESSORS INDIA PRIVATE LIMITED	Director	29/08/2011	26/07/2011	-	Active	NO

Name :	Mr. Prakash Manjanath Telang
Designation :	Nomine Director
Address :	Flat # D – 211 Paradise Towers, Plot # 10 Baner Road, Pune – 411045, Maharashtra, India
Date of Birth/Age :	21.06.1947
Qualification :	BE (Mech.), MBA (IIM, Ahmedabad)
Date of Appointment :	30.06.2006
DIN No.:	00012562

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	U34101JH1993PLC005546	TATA CUMMINS LIMITED	Director	1/9/2000	1/9/2000	-	Active	NO
2	U29113PN1994FLC139153	CUMMINS TECHNOLOGIES INDIA LIMITED	Director	7/3/2001	7/3/2001	27/02/2007	Active	NO
3	L35911GA1980PLC000400	AUTOMOBILE CORPORATION OF GOA LIMITED	Director	30/07/2002	30/07/2002	-	Active	NO
4	U29100PN2000PLC130290	TAL MANUFACTURING SOLUTIONS LIMITED	Director	17/07/2006	26/04/2004	-	Active	NO
5	U85110KA1998PLC024588	TELCO CONSTRUCTION EQUIPMENT COMPANY LIMITED	Nominee director	25/01/2012	30/06/2006	-	Active	NO
6	U34101MH2006PLC164771	TATA MARCOPOLO MOTORS LIMITED	Nominee director	25/06/2007	20/09/2006	-	Active	NO
7	L28920MH1945PLC004520	TATA MOTORS LIMITED	Managing director	2/6/2009	18/05/2007	21/06/2012	Active	NO
8	U34100MH2000PLC124874	TML DRIVELINES LIMITED	Director	22/05/2008	22/08/2007	14/07/2009	Active	NO
9	U29130MH2000PLC124872	HV TRANSMISSIONS LIMITED	Director	22/05/2008	22/08/2007	15/07/2009	Amalgamated	NO
10	U28900PN1997PLC130940	FIAT INDIA AUTOMOBILES LIMITED	Director	20/12/2011	19/03/2008	-	Active	NO
11	U63000MH2008PLC180593	TML DISTRIBUTION COMPANY LIMITED	Director	25/08/2009	11/7/2008	-	Active	NO
12	U72900AP2006PLC077939	TATA ADVANCED SYSTEMS LIMITED	Director	16/09/2009	29/07/2009	-	Active	NO
13	L72300PN1990PLC056696	PERSISTENT SYSTEMS LIMITED	Director	18/07/2011	19/08/2010	-	Active	NO
14	U85300DL2008NPL181612	NATIONAL SKILL DEVELOPMENT CORPORATION	Director	26/09/2011	29/07/2011	-	Active	NO
15	U29268AP2010PLC077940	TATA LOCKHEED MARTIN AEROSTRUCTURES LIMITED	Director	20/09/2011	10/8/2011	-	Active	NO
16	U74990AP2008PLC077969	TARA AEROSPACE SYSTEMS LIMITED	Director	20/09/2011	1/9/2011	-	Active	NO

Name :	Mr. Hiroaki Isshiki
Designation :	Alternate Director
Address :	3-13-8 Izumi-Honcho Komae City, Tokyo – 2010003
Date of Birth/Age :	23.04.1958
Qualification :	Graduate- Foreign Studies, Osaka University
Date of Appointment :	30.03.2010
DIN No.:	02107087

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	U85110KA1998PLC024588	TELCO CONSTRUCTION EQUIPMENT COMPANY LIMITED	Alternate director	27/04/2012	24/03/2008	-	Active	NO
2	U45203KA2003PTC032752	TELCON ECOROAD RESURFACES PRIVATE LIMITED	Nominee director	7/8/2008	7/8/2008	-	Active	NO

Name :	Motohiro Narao
Designation :	Alternate director
Address :	1-39-7, Sakashita, Itabashi-ku, Tokyo, Japan
Date of Birth/Age :	18.11.1962
Date of Appointment :	18.10.2006
DIN No.:	01680806

Name :	Mr. Yoshimi Iwase
Designation :	Nominee Director
Address :	3251-3, Mitsukaidousuwa-cho, Jousou-city, Lbaraki, Japan
Date of Birth/Age :	12.03.1951
Qualification :	Science Graduate (University of Tokyo)
Date of Appointment :	30.03.2010
DIN No.:	03041650

KEY EXECUTIVES

Name :	Mr. Azhagesan Ayyamperumal
Designation :	Company Secretary
Address :	Tulip 002, Rakesh Fantasy garden 118, Kasturinagar, 2^nd Main Road, OMBR Layout, Banaswadi, Bangalore – 560 043
Date of Birth :	27.09.1963
Date of Appointment :	09.01.2001

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 27.06.2011

Names of Shareholders	No. of Shares
Tata Motors Limited (India)	39749994
Tata Motors Limited jointly with Mr. C. Ramakrishnan	1
Tata Motors Limited jointly with Mr. Hoshang K. Sethna	1
Hitachi Construction Machinery Company Limited (India)	60000000
Sheba Properties Limited (India)	250000
Tata Motors Limited jointly with Mr. Ranaveer Sinha	1
Tata Motors Limited jointly with Mr. G. Mani	1
Tata Motors Limited jointly with Mr. Manav Kohli	1
Tata Motors Limited jointly with Mr. N. Venkatakrishnan	1
GreenARM Company Limited	8000
IVRCL Limited	4800
Total	100012800

As on 27.06.2011

Equity Share Break up (Percentage of Total Equity)

Category	Percentage
Foreign holdings (Foreign institutional investor (s), Foreign companie (s) Foreign financial institution (s), Non-resident Indian (s) or Overseas corporate bodies or Others)	60.00
Bodies Corporate	40.00
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturing and Exporter of construction equipments and earth moving equipments.

Products :

Product Description	Item Code No.
Excavators, Loaders, Mechanical Shovels and parts thereof	8429

• Hydraulic Excavators
• Crawler Cranes
• Wheel Loader
• Backhoe Loader
• Agency Products

PRODUCTION STATUS

As on 31.03.2010

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
Earthmoving Machinery including bull-dozers, dumpers, scrapers, loaders, shovels and draglines (excluding walking draglines	Nos.	NA	15388	5052

GENERAL INFORMATION

No. of Employees :

1055 (Approximately)

Bankers :

• State Bank of India, Corporate Accounts Group Branch, Express Towers, Nariman Point, Mumbai – 400021, Maharashtra, India
• Standard Chartered Bank, 26-27, Raheja Towers, M G Road, Bangalore – 560001, Karnataka, India
• Bank of Baroda, Bangalore, Karnataka, India
• Corporation Bank, Bangalore, Karnataka , India
• HDFC Bank Limited, Kasturba Road, Bangalore – 560001, Karnataka, India
• DBS Bank Limited, Salarpuria Windsor, No.3, Ulsoor Road, Bnagalore – 560 042, Karnataka, India
• The Bank of Tokyo Mitsubishi UFJ Limited, Mumbai Branch, Hoechst House, 15 Floor, 193, Vinay K Shah Marg, Nariman Point, Mumbai – 400 021, Maharashtra, India
• Citibank N.A., UB City, Canberra Block, #24, Vitthal Mallya Road, Bangalore – 560001, Karnataka, India
• Standard Chartered Bank, 26,27, Raheja Towers, M G Road, Bangalore - 560001, Karnataka, India
• Axis Bank Limited, No.9,M. G. Road, Bangalore – 560001, Karnataka, India

Facilities :

Secured Loans	31.03.2011 (Rs. in Millions)	31.03.2010 (Rs. in Millions)
Term loans from Banks	0.000	1000.000
Foreign Currency Loan from Banks	2990.900	324.800
Working Capital Loans and Cash Credit Account with Banks	1862.700	1682.300
Total	4853.600	3007.100
Unsecured Loans	31.03.2011 (Rs. in Millions)	31.03.2010 (Rs. in Millions)
Commercial Paper	0.000	1088.100
Working Capital Rupee Loan	241.800	0.000
Foreign Currency Loan from Banks	31.700	0.000
Total	273.500	1088.100

Notes :

Out of the above, buyer's credit facilities amounting to Rs. 1563.600 millions (Previous year Rs 1182.300 millions) and Working capital loan from Bank's for Rs. 299.100 millions (Previous year Rs.500.000 Millions) are secured by hypothecation of inventories and sundry debtors. Foreign Currency loan and Term Loan are secured by hypothecation of Fixed Assets.

Banking Relations :	--
Auditors :
Name :	Deloitte Haskins and Sells Chartered Accountants
Address:	Deloitte Haskings and Sells, Deloitte Centre, Anchorage II, 100/2 Richmond Road, Bangalore – 560 025, Karnataka, India
Pan No :	AAAFS7376P
Tel No :	91-80-66276000
Fax No :	91-80-66276011
Collaborators:	John Deere Industrial Equipment Company, USA Euclid Hitachi, USA
Fellow Subsidiaries Hitachi :	· Hitachi Sumitomo Heavy Industries Construction Crane (shanghai) Company Limited(HSS) · Hitachi Construction Machinery Asia and Pacific Pte. Limited(HMAP) · Hitachi Construction Machinery (Europe) N.V. (HCME) · Pt. Hitachi Construction Machinery Indonesia (HCMI) · Hitachi Construction Machinery (Australia) Pty., Limited (HCA) · Hitachi Construction Truck Manufacturing Limited(HTM) · Hitachi Construction Machinery Camino Company Limited · Hitachi Construction Machinery Trading Company Limited
Fellow Subsidiaries TML :	· Tal Manufacturing Solutions Limited · Tata Technologies Limited · HV Transmissions Limited · Sheeba Properties Limited · Tata Finance Limited · Tata Motors Financial Services Limited · HV Axles Limited · Concorde Motors India Limited
Subsidiaries:	Serviplem S.A. Comoplesa lebrero S.A. Tata Motors Limited
Associate :	· Telcon Eco Road Resurfaces Private Limited (TERPL) CIN No.: U45203KA2003PTC032752
Holding Company:	Hitachi Construction Machinery Company Limited

CAPITAL STRUCTURE

As on 27.06.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
100020800	Equity Shares	Rs.10/- each	Rs.1000.208 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
100020800	Equity Shares	Rs.10/- each	Rs.1000.208 Millions

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
100000000	Equity Shares	Rs.10/- each	Rs.1000.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
100000000	Equity Shares	Rs.10/- each	Rs.1000.000 millions

 Note :

Of the above 60000000 Ordinary Shares of Rs.10 each held by Hitachi Construction Machinery Limited, the holding company.

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		1000.000	1000.000	1000.000
2] Share Application Money		0.200	0.000	0.000
3] Reserves & Surplus		5943.300	6250.100	5679.800
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		6943.500	7250.100	6679.800
LOAN FUNDS
1] Secured Loans		4853.600	3007.100	4007.800
2] Unsecured Loans		273.500	1088.100	785.500
TOTAL BORROWING		5127.100	4095.200	4793.300
DEFERRED TAX LIABILITIES		323.600	249.500	125.200
TOTAL		12394.200	11594.800	11598.300
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		6740.800	5131.800	2747.500
Capital work-in-progress		1495.600	1832.100	2526.500
INVESTMENT		1788.700	2596.100	2581.700
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	5137.100	5179.500	7052.800
	Sundry Debtors	2757.400	2184.800	2469.700
	Cash & Bank Balances	792.200	423.300	2.100
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	7171.200	6044.700	5120.400
Total Current Assets		15857.900	13832.300	14645.000
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	4812.500	3966.000	3620.200
	Other Current Liabilities	3208.200	2730.500	3157.500
	Provisions	5468.100	5102.600	4148.200
Total Current Liabilities		13488.800	11799.100	10925.900
Net Current Assets		2369.100	2033.200	3719.100
MISCELLANEOUS EXPENSES		0.000	1.600	23.500
TOTAL		12394.200	11594.800	11598.300

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Income	24504.800	19515.300	19366.900
		Other Income	84.700	459.200	129.000
		TOTAL (A)	24589.500	19974.500	19495.900
Less	EXPENSES
		Consumption Materials Changes Inventories	18677.600	14913.000	17605.400
		Manufacturing Service Costs	723.600	566.500
		Contract Cost	51.200	0.000
		Employee Related Expenses	1261.000	1053.600
		Administrative Selling Other Expenses	1878.900	1295.700
		TOTAL (B)	22592.300	17828.800	17605.400
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		1997.200	2145.700	1890.500
Less	FINANCIAL EXPENSES (D)		262.900	308.500	286.400
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		1734.300	1837.200	1604.100
Less/ Add	DEPRECIATION/ AMORTISATION (F)		379.200	263.400	241.100
	PROFIT BEFORE TAX (E-F) (G)		1355.100	1573.800	1363.000
Less	TAX (I)		403.100	537.100	516.000
	PROFIT AFTER TAX (G-I) (J)		952.000	1036.700	847.000
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		4523.200	4057.400	3880.800
Less	APPROPRIATIONS
		Transfer to General Reserve	532.200	104.500	85.400
		Interim Dividend		0.000	500.000
		Tax on Interim Dividend		0.000	85.000
		Proposed Dividend		400.000	0.000
		Tax on Proposed Dividend		66.400	0.000
	BALANCE CARRIED TO THE B/S		4943.000	4523.200	4057.400
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	113.300	106.900	321.100
		Commission Earnings	32.000	17.000	22.500
		Other Earnings	13.200	5.100	1.500
	TOTAL EARNINGS		158.500	129.000	345.100
	IMPORTS
		Raw Materials and Components	6227.500	3647.900	5317.800
		Spares	1185.400	1121.800	953.200
		Capital Goods	94.500	127.400	195.900
		Machines	435.600	902.300	3063.100
	TOTAL IMPORTS		7943.000	5799.400	9530.000
	Earnings Per Share (Rs.)		9.52	10.37	8.47

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	3.87	5.19	4.34
Net Profit Margin (PBT/Sales)	(%)	5.53	8.06	7.04
Return on Total Assets (PBT/Total Assets}	(%)	6.00	8.30	7.84
Return on Investment (ROI) (PBT/Networth)		0.20	0.22	0.20
Debt Equity Ratio (Total Liability/Networth)		2.68	2.19	2.35
Current Ratio (Current Asset/Current Liability)		1.18	1.17	1.34

LOCAL AGENCY FURTHER INFORMATION

Sr. No.	Check List by Info Agents	Available in Report (Yes / No)
1]	Year of Establishment	Yes
2]	Locality of the firm	Yes
3]	Constitutions of the firm	Yes
4]	Premises details	Yes
5]	Type of Business	Yes
6]	Line of Business	Yes
7]	Promoter's background	Yes
8]	No. of employees	Yes
9]	Name of person contacted	No
10]	Designation of contact person	No
11]	Turnover of firm for last three years	Yes
12]	Profitability for last three years	Yes
13]	Reasons for variation <> 20%	--
14]	Estimation for coming financial year	No
15]	Capital in the business	Yes
16]	Details of sister concerns	Yes
17]	Major suppliers	No
18]	Major customers	No
19]	Payments terms	No
20]	Export / Import details (if applicable)	No
21]	Market information	--
22]	Litigations that the firm / promoter involved in	Yes
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]	PAN of Director, if available	No
32]	Passport No of Director, if available	No
33]	Voter ID No of Director, if available	No

LITIGATION AGAINST SUBJECT

SEPTEMBER 29, 2008

1. 36 cases have been filed by various customers of subject in different District Consumer Forum, against Subject Limited, alleging defects in various products. The aggregate amount of the claims in these cases is Rs. 100.010 million. The matters are currently pending.

2. Seven cases have been filed by various customers in different State Consumer Commissions, against subject, alleging defects in various products. The customers have claimed compensation from subject. The aggregate amount of the claims in these cases is Rs. 142.340 million. The matters are currently pending.

3. Six cases have been filed by various customers before the MRTP, New Delhi, against subject, alleging defects in various products. The customers have claimed compensation from Subject Limited. The aggregate amount of the claims in these cases is Rs. 169.800 million. The matters are currently pending.

INDUSTRY OVERVIEW

The countrys economic growth story that began with a quick revival after the upheaval of 2008-09 continued this year with an estimated GDP growth of 8.6%. The flow of credit to the Construction Equipment (CE) Industry continued, though there were some calibrated rate increases announced by the Government to keep a check on inflation. The initiatives of the Government of India under Bharat Nirman infiltrated the CE Industry in terms of huge investment in rural roads, housing and water supply, continued to drive the demand in the industry. All these factors had resulted in high volumes for key product categories of the CE Industry, namely, Excavators, Backhoe Loaders and Wheel Loaders, assuring to surpass the market size seen in the pre-slowdown era. However, the Road Sector did not show any promising result in the year 2010-11, in the light of much publicized promise of 20KM a day. Also, mining output, especially coal production witnessed a relatively subdued growth, and this impacted the demand for large class Excavators and Dumpers.

The investment from around the Globe intensified the competition in India thereby leading into continuous expansion of the product range for local production. The continuous flow of foreign investment drove the demand for Construction Equipments in India resulting in a credible growth. Meanwhile the imports of fully built machines continued with marked contributions from Korean and Chinese manufacturers.

OPERATING RESULTS

Despite the intense competition, the Company was able to register a growth of 26% in the year 2010-11 over the previous year, and sold 6807 machines (5405 in 2009-10). During the year, it retained the market leadership in the Excavators segment, and also launched new models. The profitability for the year had however suffered a marginal decline from the previous year owing to the impact of exchange rate fluctuation, as accounted in compliance with AS-11.

INFRASTRUCTURE AND FACILITIES

At Jamshedpur: In order to ameliorate the quality, new machinery were installed at the Companys plant at Jamshedpur, namely, a Liebherr Gear Hobbing Machine, O-M Vertical Turn Mill Centre and a Cone Rolling Machine for the Transit Mixers. Further, some fixtures were installed for manufacturing Transit Mixers and Larger Excavators. A 4000-CFM compressor was installed to cater air supply at the plant. The RandD setup was substantiated with a Cylinder Testing Facility and a Salt Spray Chamber.

At Dharwad: The plant at Dharwad increased its capability by installing a new bay in the 110KV Switchyard and substation #05 for new paint shop. A NAS Value testing shed was commissioned for testing the quality of Hydraulic oil used in the Excavators. The Company extended its dispatch area and added loading ramps. Also an A-2 spindle nut runner was installed in the Transmission Assembly. In order to increase storage space, it has also installed a High rise racking system for vertical storing of the materials. A sewage treatment plant was setup for treatment of domestic waste as an initiative towards environment and climate-change.

At Kharagpur: The plant at Kharagpur augmented its infrastructure and facilities to move towards a world class facility. Fabrication and Heavy Machine shop for Excavators, Assembly shop for Wheel Loaders and Frame Paint shops were made operational during 2010-11. It also set up a third substation of 2000KVA. Its commitment towards environment was reiterated with the installation and commissioning of a water treatment plant, a sewage treatment plant and a small effluent treatment plant. Also, new offices were inaugurated for Excavator Fabrication

Shop and Supply Chain Management

OPERATIONS

During the year, the Company increased its operations, in line with its strategic plans and thereby achieving quality standards. The production of finished machines for the year 2010-11 was at 6838 units (5053 in 2009-10). Dharwad plant produced maximum volumes of 5324 units, which included the mini and mid-sized excavators and backhoe loaders, as against 4129 units in the previous year. Jamshedpur produced 658 (729 in 2009-10) large class machines, besides the aggregates manufactured for assembly at Dharwad and Kharagpur. During the year, some of the models earlier produced in Jamshedpur were migrated to Kharagpur plant. Kharagpur plant produced 856 units (195 in 2009-10) of Excavators and Dumpers in the second year of its operations. In 2010-11, 3 prototypes of X3 Compactors were made in Jamshedpur and a prototype of 5T Backhoe Loader in Dharwad plant. During the year, the production of Transit Mixers was increased to 115 units, as against 12 units in 2009-10.

OUTLOOK

The countrys GDP growth for 2011-12 is budgeted to be over 8.5%, which is driven largely by the continued focus on infrastructure, especially in roads and urban /rural projects. The last budget provided for a hike in allocation for infrastructure by 23% over the previous year, in the form of tax free bonds, port development projects, railways projects and credit disbursal through IIFCL. All Metro projects at Delhi (for extension), Chennai, Bengaluru and Mumbai have been taken up on priority. This would provide a fillip to the CE business in the country, with an upsurge in demand for Mini and Midi Excavators and Wheeled Products as well.

Mining, one of the key sectors which drive the demand for Large Excavators, is likely to increase the demand primarily for Coal Industry. It is critical for the Company to meet the demand in the Power Sector, in which new capacities are already being created. After a subdued growth in 2010-11, Minings growth is likely to rise with the issuance of a number of project clearances. Apart from large class Excavators, this is likely to increase the demand for Dumpers and Wheel Loaders too.

During the year, the Companys Sales and Marketing Organization was restructured with the creation of new industry verticals, in order to exploit the above opportunities and provide a focused approach in realizing them. Also, dedicated personnel were added in the Concrete and Crane verticals. While the CE Industry is poised for a steady growth, it is likely to be restrained by issues like delay in awarding projects, inhibition of environmental clearances, worries of Inflation, increasing interest rates and persisting global uncertainties. However, the Company has adequately factored these issues into its future plans and is geared up to capitalize on the growth opportunities.

BANKERS CHARGES REPORT AS PER REGISTRY

Corporate identity number of the company	U85110KA1998PLC024588
Name of the company	TELCO CONSTRUCTION EQUIPMENT COMPANY LIMITED
Address of the registered office or of the principal place of business in India of the company	Jubilee Building, 45, Museum Road, Bangalore - 560025, Karnataka, India E-mail id: telcon@telcon.co.in
This form is for	Creation of charge
Type of charge	Others (Plant and machinery)
Particular of charge holder	Citibank N.A., UB City, Canberra Block, #24, Vitthal Mallya Road, Bangalore – 560001, Karnataka, India E-mail id : abhijit.menon@citi.com
Nature of instrument creating charge	Deed of Hypothecation executed in favour of Citibank on 25.04.2012 with respect to the FCNR (US$) loan of Rs.520.000 Millions, which was sanctioned vide Loan Agreement dated 24.01.2012
Date of instrument Creating the charge	25.04.2012
Amount secured by the charge	Rs.520.000 Millions
Brief of the principal terms an conditions and extent and operation of the charge	Rate of interest : Such rates as agreed at the time of each draw down (On 2nd Feb'12, the loan amount was drawn in single tranche at an agreed interest rate of 7.20% p.a.). Terms of repayment : The Loan shall be repaid by the Borrower in a single tranche at the expiry of thirty six (36) months from the date of draw down. Margin Not provided in the Loan Agreement or in the Deed of Hypothecation. Extent and operation of the charge : First pari passu charge ranking pari passu with other lenders over all the Company's plant and machinery wherever located at all the Company's plants.
Short Particulars of the property charged	All the Company's plant and machinery wherever located at all the Company's plants at Jamshedpur (Jharkhand), Dharwad (Karnataka) and Kharagpur (West Bengal)

FIXED ASSETS:

• Building
• Leasehold Land
• Leasehold Improvement
• Plant
• Machinery
• Equipment
• Water systems and sanitation
• Furniture,
• Fixtures
• Office appliances
• Vehicles
• Transport

 WEBSITE DETAILS:

Profile:

Subject (Telcon) is India's leading provider of equipment and services in the construction and earth-moving industries. Set up in 1961 as a division of Tata Motors, it is now a 60:40 joint venture between Tata Motors and Hitachi Construction Machinery Company of Japan.

Apart from supplying to the Indian market, Telcon also exports construction equipment to African, Asian and Middle Eastern countries.

Areas of business

Telcon supplies a wide range of construction equipment, including hydraulic excavators, mining shovels, dumpers, backhoe loaders, wheel loaders, vibratory compactors, motor graders, crawler cranes, asphalt plants and multi-utility loaders. The company also offers a wide range of value-added services.

Joint ventures, subsidiaries, associates

· Telcon Eco Road Resurfaces (a joint venture with IVRCL, India, and Hitachi and Green Arm, Japan)

· Hitachi Construction, Japan (hydraulic excavators and cranes) 

· Lebrero, Spain (compactors)

· CESAN, Turkey (asphalt plants)

· Hitachi Truck Manufacturing, USA (dumpers)

· Tadano, Japan (tyre-mounted cranes)

· Hitachi-Sumitomo, Japan (crawler cranes)

· Berco (undercarriages)

· Serviplem, Spain (concrete mixers and dry bulk tanks)

Location

Based in Bengaluru, the company has manufacturing plants in Jamshedpur and Dharwad, with a third one coming up in Kharagpur (all locations in India). It has a sales and service customer network of over 100 offices across India.

CMT REPORT (Corruption, Money Laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No records exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

6] Records on Int’l Anti-Money Laundering Laws/Standards :

Charges or investigation registered against subject: None

7] Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

8] Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

9] Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

CONTRAVENTION

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.55.76
UK Pound	1	Rs.86.80
Euro	1	Rs.67.43

INFORMATION DETAILS

Report Prepared by :

BSN

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	8
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	7
--LIQUIDITY	1~10	7
--LEVERAGE	1~10	7
--RESERVES	1~10	8
--CREDIT LINES	1~10	6
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	YES
--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		64

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.