MIRA INFORM REPORT

Report Date :

07.06.2012

IDENTIFICATION DETAILS

Name :	SIKKIM STATE CO-OPERATIVE SUPPLY AND MARKETING FEDERATION LIMITED
Registered Office :	Dr. Kotwal Building, Sonam Gyatso Marg, Opposite Hotel Sonam Delek, Gangtok – 737101, Sikkim
Country :	India
Financials (as on) :	31.03.2010
Year of Establishment :	1984
Capital Investment / Paid-up Capital :	Rs.17.795 Millions
Legal Form :	Co-operative Society
Line of Business :	Trader of Agro-Based Products
No. of Employees :	65 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

Ba (44)

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

Maximum Credit Limit :	USD 400000
Status :	Satisfactory
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is an established co-operative society having satisfactory track. Mr. Kailash (General Manager) has provided to us the general information and denied to disclose the financial details. Therefore, the report is based on the financial available in previous report. Trade relations are reported as fair. Business is active. Payments are reported to be usually correct and as per commitments. The society can be considered normal for 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

INFORMATION PARTED BY (General Details)

Name :	Mr. Kailash
Designation :	General Manager
Contact No.:	91-9832014342
Date :	25.05.2012

LOCATIONS

Registered Office :	Dr. Kotwal Building, Sonam Gyatso Marg, Opposite Hotel Sonam Delek, Gangtok – 737101, Sikkim, India
Tel. No.:	91-3592-203432/ 202429
Mobile No.:	91-9832014342 (Mr. Kailash)
Fax No.:	91-3592-203451
E-Mail :	bongdelkailash@yahoo.co.in brijendra_swaroo@rediffmail.com
Website :	www.simfed.in
Area :	2000 sq.ft
Location :	Rented
Branches / Units :	SIMFED Mangan Bazar, Mangan, North Sikkim 737116 Contact Person : Mr. D.B. Basnet Ph: 9475079191 SIMFED Wholesale Regulated Market, Rangpo, East Sikkim 737132 Contact person: Mr. Kumar Gurung Ph: 9434109856. SIMFED Jorethang bazar, South Sikkim 737121 Contact Person: Mr. Narman Subba Ph: 9434982347. SIMFED Yard no TA 3 Siliguri Regulated Market, Siliguri 734401 Contact Person: Mr. Arun Sharma Ph: 9832042253. SIMFED Namchi Bazar, Namchi, South Sikkim 737126 Contact Person: Mr. Ram Bali Ph: 9434357416.

MANAGEMENT

Name :	Mrs. N Yethenpa
Designation :	Secretary/ Cooperation
Contact:	91-3592-270796
Name :	Mr. Dorjee Dadul
Designation :	Addl Registrat
Contact:	91-3592-231878
Name :	Mr. Dilip Tamang
Designation :	Joint Registra (South )
Contact:	95-3595-263815
Name :	Mr. S Damdi
Designation :	Joint Register (HQ)
Contact:	91-3592-232007
Name :	Mr. C N Khanal
Designation :	Joint Register (HQ)
Contact:	91-3592-232007
Name :	Mr. J M Pradhan
Designation :	Joint Registrar (West)
Contact:	95-3595-250433
Name :	Mr. R K Gautam
Designation :	Joint Registrar (East)
Contact:	95-3592-232319
Name :	Mr. Binod Gurung
Designation :	Deputy Registrar (Rongli)
Contact:	91-9832096273
Name :	Mrs. Purnima Gurung
Designation :	Deputy Registrar (Pakyng)
Contact:	95-3592-253796
Name :	Mr. N T Denzongpa
Designation :	Deputy Registrar (Ravongla)
Contact:	91-9434143983
Name :	Mr. Brijendra Swaroop
Designation :	Indian Forest Officer
Name :	Mr. Kailash Rai
Designation :	Dy. General Manager
Mobile No.:	91-9832014342
Name :	Mr. Girish Chandrs Rai/ Mrs. S. K. Pradhan
Designation :	MLA Chairman / Managing Director
Address:	Kazi Road, Gangtok - 737101
Name :	Mr. Brijendra Saurup
Designation :	Managing Director

BUSINESS DETAILS

Line of Business :	Trader of Agro-Based Products.
Products :	Ø Cut flowers Ø Fresh vegetables Ø Zinger Ø Large cardamom Ø Cymbidium cut flowers
Terms :
Selling :	Cash and Credit
Purchasing :	Cash and Credit

GENERAL INFORMATION

Customers :

End Users

No. of Employees :

65 (Approximately)

Bankers :

Ø State Bank of Sikkim, Branch Gangtok

Ø Axis Bank, Branch Gangtok

Ø SISCO Bank

Facilities :

Loans Funds	31.03.2010 (Rs. In Millions)
Overdrafts with bank
Axis Bank	0.422
Vehicle Loan SISCO Bank	0.662
Total	1.084
Consumer Business
Overdraft with citizens Bank	2.017
Total	3.101

Banking Relations :	--
Auditors :
Name :	S. Das and Company Chartered Accountant
Membership:	Ø Akash Ganga Co-operative Society Ø Namchimult Purpose Co-operative Society Ø Gayzing Multi Purpose Co-operative Society

CAPITAL STRUCTURE

(AS ON 31.03.2010)

Authorised Capital :

No. of Shares	Type	Value	Amount
300000	Equity Shares	Rs.100/- each	Rs. 30.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
154750	Equity Shares	Rs.100/- each	Rs.15.475 Millions
20297	Equity Shares	Rs.100/- each	Rs. 2.320 Millions
	Total		Rs.17.795 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2010	31.03.2009	31.03.2008
SHAREHOLDERS FUNDS
1] Share Capital		17.795	17.505	16.918
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		49.945	45.688	30.867
4] Profit and Loss Account		30.608	20.729	13.221
NETWORTH		98.348	83.922	61.006
LOAN FUNDS
1] Secured Loans
2] Unsecured Loans
TOTAL BORROWING		3.101	0.000	4.715
Grants and Subsidy		0.000	10.000	11.038
TOTAL		101.449	93.922	76.759
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		4.505	2.906	2.364
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		0.491	0.141	0.140
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	2.746	2.373	1.874
	Sundry Debtors	340.581	201.231	225.373
	Cash & Bank Balances	67.750	77.679	103.514
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	36.250	43.742	4.972
Total Current Assets		447.327	325.025	335.733
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	223.503	121.530	162.114
	Other Current Liabilities	116.314	104.377	96.768
	Provisions	11.057	8.243	2.596
Total Current Liabilities		350.874	234.150	261.478
Net Current Assets		96.453	90.875	74.255
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		101.449	93.922	76.759

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Income	508.820	544.202	502.938
		Other Income	17.915	20.437	17.101
		TOTAL (A)	526.735	564.639	520.039
Less	EXPENSES
		Purchases	497.766	521.535	499.476
		Employees remuneration and benefits	11.575	12.468	7.277
		Administrative expenses	3.858	3.722	2.522
		Marketing expenses	2.129	1.898	0.416
		Variation in stock	(0.374)	0.306	1.876
		TOTAL (B)	514.954	539.929	511.567
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		11.781	24.710	8.472
Less	FINANCIAL EXPENSES (D)		0.383	0.019	0.026
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		11.398	24.691	8.446
Less/ Add	DEPRECIATION/ AMORTISATION (F)		0.828	0.596	0.708
	PROFIT BEFORE TAX (E-F) (G)		10.570	24.095	7.738
Less	TAX (H)		5.544	6.020	0.000
	PROFIT AFTER TAX (G-H) (I)		5.026	18.075	7.738
	UNUSUAL ITEMS		10.000	4.071	0.000
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		20.729	13.221	11.094
Less	APPROPRIATIONS
		Statutory Reserve	3.756	4.513	1.935
		Building Reserve Fund	0.000	1.000	1.500
		Consumer Business Reserve Fund	0.000	1.750	0.500
		Agri. Business Reserve Fund Horticulture and Floriculture Business	0.000	3.000	1.000
		Reserve Fund	0.000	3.000	0.000
		Training and Education Fund	0.250	0.250	0.000
		Reserve Employees Benevolent Reserve Fund	0.250	0.250	0.000
		Proposed Dividend	0.890	0.875	0.676
	BALANCE CARRIED TO THE B/S		30.609	20.729	13.221
	Earnings Per Share (Rs.)		32.48	NA	NA

Particulars	31.03.2011
Sales Turnover (Approximately)	580.000

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	0.95	3.20	1.49
Net Profit Margin (PBT/Sales)	(%)	2.08	4.43	1.54
Return on Total Assets (PBT/Total Assets}	(%)	2.34	7.35	2.29
Return on Investment (ROI) (PBT/Networth)		0.11	0.29	0.13
Debt Equity Ratio (Total Liability/Networth)		3.60	2.79	4.36
Current Ratio (Current Asset/Current Liability)		1.27	1.39	1.28

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	Yes
Type of Business	Yes
Line of Business	Yes
Promoter’s Background	No
No. of Employees	Yes
Name of Person Contacted	Yes
Designation of Contact person	Yes
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	No
Major Suppliers	No
Major Customers	No
Payments Terms	Yes
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	No
Last Accounts filed at ROC	No
Major Shareholders, if available	No

RESERVES AND RESULTS OF OPERATIONS (AS ON 31.03.2010)

Total reserve increased from Rs.45.688 Millions in the previous year to Rs. 49.294 Millions during 2009-10 registering a growth rate of 7.89%. The operating profit decreased by 45.41% i.e. the operating profit decreased from Rs. 24.095 Millions during 2008-09 to Rs. 16.570 Millions during 2009-10.

PROFIT

The net profit of the Federation is Rs. 16.570 Millions during the year 2009-10.

DISTRIBUTION OF PROFIT

In terms of Sikkim Cooperative Societies Act 1978 read with Bye Laws No. 44 the net profit has been appropriated as per the consideration and approval of the 52nd Board of Directors Meeting.

SURPLUS AGRICULTURAL MARKETING

Marketing of Surplus agriculture produces like Ginger, Hill Broom and Local oranges of various MPCS were marketed by SIMFED during the year 2009-10 . The total value of the Agriculture Surplus produces marketed by SIMFED during 2009-10 was Rs. 6.055 millions against the total value of Rs. 3.631 millions during the year 2008-09. This is an increase by 66.75%.

ACHIEVEMENTS AND NEW INITIATIVES

Emphasis is being given for marketing of Surplus Agricultural Produces including cut-flower and bulbs. Like informed earlier during the financial year 2009-10 marketing of Agriculture and Horticulture Surplus produce worth Rs. 6.055 millions was done as compared to Rs. 3.631 millions during the last financial year.

In addition to it, cut flowers namely cymbidium orchids, Oriental and Asiatic Lilium, Gentadesia, Gerbera, Roses etc. worth Rs. 5.339 millions were also marketed to Delhi, Guwahati and Kolkata markets as compared to Rs. 0.440 million during the last financial year. Contractual farming in lilium has been a success and the farmers have been paid remunerative prices.

Further, SIMFED in order to stabilize the prevailing market price of Consumer Household is continuing with the operation of the retail outlets in Namchi and Jorethang in addition to the retail outlet at Super Market Complex. The Federation has been successful in regularizing the market price of the commodity and they have achieved in doing these business, hence fulfilling the mandate given under our Bye Laws.

In order to fufill the visions of the Hon’ble Chief Minister of Sikkim and to support the Sikkim Organic Mission 2015, SIMFED has recently taken over the Sikkim Organics retail outlet in GK1, New Delhi. SIMFED will be marketing the floriculture produce and the organic produces of the state from this retail outlet under the brand name of SIKKIM ORGANICS.

SIMFED in order to expand its business has been concentrating on contractual farming and marketing of the medicinal plants of the state of Sikkim. With the approval of the State government a MOU has been signed with the Himalaya Drug Company, Bangalore to market the medicinal plants and herbs of Sikkim. MOUs have also been signed with other organic companies like the M/s. International Pannecae Limted and M/s. Morarka Foundation.

FIXED ASSETS:

· Furniture and Fixture

· Weights and Measure

· Office Equipment

· Super Bazaar Counter-Furniture’s

· Computer

· Sony Digital Camera

· EPABX Systems

· Inverter and UPS

· Packaging Machines

· Vehicles

· Electronic Weighing Machines

AS PER WEBSITE DETAILS

Aims and Objectives

The objectives of SIMFED are as follows:

• To arrange for the sale of agricultural produce and other allied products of the members of the affiliated societies and others members to their best advantages.
• To purchase and sell Agricultural Produce and the supply of Agricultural Inputs such as seed, fertilizer etc as required by farmers.
• To act as an agent of members societies for the disposal of produce.
• To act on behalf of the state Government as agent for receiving, stocking and selling fertilizer dispatched to the state Government account from the central pool.
• To carry on trading in agricultural produce and other essential commodities as agent of the state Government and distribution of controlled non-controlled commodities procured from outside the state in suitable circumstances or on behalf of the affiliated societies and other cooperatives.
• To do such business with non members as may be conducive to the promotion of the economic interest of members under conditions as may be directed upon from time to time by the board of Directors by a resolution in writing provided that the registrar does not direct otherwise.
• To undertake procurement, processing, grading and marketing of agricultural produce, fruits and vegetables handled by the Federation as and when necessary and to establish and run manufacturing and processing units for the production of consumer goods in collaboration with other co-operative or directly by itself.
• To encourage general thrift, self-help and cooperation among the members.

Future Plans of SIMFED

• Enhanced focus on marketing of agricultural and horticulture surplus through MPCSs by establishing proper chain of supply, developing associated infrastructure, manpower development etc.
• Increasing business of consumer items to provide goods at very competitive prices to common people of Sikkim with the help of various retail outlets of SIMFED as well as MPCSs.
• Expanding business regarding supplies of various materials required by other institutions like various power developers, GOI institutions etc. to generate funds for strengthening of the co-operative sector.
• Developing specific BDPs for various MPCSs in consultation with other institutions and leading them to become viable business organizations at grass root level.
• Capacity building of various officials and staff of SIMFED in modern business environment.
• Modernization of SIMFED to meet the challenges of new era and equipping it with modern business tools like website creation, faster communication network to bring transparent environment etc.

Business of SIMFED

Presently SIMFED is involved in the following businesses:

• Procurement of Surplus Agriculture and Horticulture produce and disposal of the same through SIMFED’s yard at the regulated market, Siliguri.
• Procurement and supply of seeds, fertilizer, agricultural tools and Implements, organic manure, pesticides etc. to the Food Security and Agriculture Development Department and the Horticulture and Cash Crops Development Department.
• Procurement of all consumer items from the nearest whole sale market at Siliguri and supply of the same to the MPCS and CCS.
• Procurement and Supply of various construction materials viz. TMT Bars, cement, and other hardware items to various govt. departments.
• Procurement and supply of office stationeries, exercise book, furnitures, computers etc.
• Supply of uniforms to class IV staffs of the Government departments including Police Department.
• Supply of various miscellaneous items required by the Govt. departments.

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.55.50
UK Pound	1	Rs.85.58
Euro	1	Rs.69.30

INFORMATION DETAILS

Information Gathered by :	PJA
Report Prepared by :	NIT

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	4
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	5
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	4
--CREDIT LINES	1~10	5
--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	NO
--AFFILIATION	YES/NO	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		44

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.