MIRA INFORM REPORT

Report Date :

08.06.2012

IDENTIFICATION DETAILS

Name :	HERCULES PIGMENTS PRIVATE LIMITED
Registered Office :	402, Peninsula Heights, C D Barfiwala Marg, Juhu Lane, Andheri (West), Maharashtra
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	31.05.2007
Com. Reg. No.:	11-171238
Capital Investment / Paid-up Capital :	Rs.1.850 Millions
CIN No.: [Company Identification No.]	U24100MH2007PTC171238
TAN No.: [Tax Deduction & Collection Account No.]	MUMH10656C
PAN No.: [Permanent Account No.]	AABCH8689Q
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacturing and Marketing of Organic and Inorganic Pigments
No. of Employees :	30 (approximately)

RATING & COMMENTS

MIRA’s Rating :

Ba (43)

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

Maximum Credit Limit :	USD 150000
Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject is an established company having satisfactory track. The company is doing well. Trade relations are reported as fair. Business is active. Payments are reported to be usually correct. The company 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.

INFORMATION DECLINED BY

Name :	Mr. Sirosh Kumar
Designation :	Accounts Manager
Contact No.:	91-22-26248426
Date :	07.06.2012

LOCATIONS

Registered Office :	402, Peninsula Heights, C D Barfiwala Marg, Juhu Lane, Andheri (West), Mumbai – 400061, Maharashtra, India
Tel. No.:	91-22-26248426/ 26252235/ 42435353
Fax No.:	91-22-26249393
E-Mail :	info@herculespigment.com info.apdoshi@gmail.com sirash@herculespigment.com sales@herculespigment.com
Website :	www.@herculespigment.com
Area :	2000sq.fts
Location :	Owned
Factory :	Plot No.316-B, Phase 2, GIDC, Vapi – 396195, Maharashtra, India
Tel No.:	91-260-2421836
E-Mail :	kumarsirash@yaho.co.in

DIRECTORS

(AS ON 30.09.2011)

Name :	Ms. Swetal Narendra Desai
Designation :	Director
Address :	214/215, Ramzarukha, S V Road, Andheri (West), Mumbai – 400058, Maharashtra, India
Date of Birth/Age :	28.05.1978
Date of Appointment :	31.05.2007
DIN No.:	00260469
Name :	Mrs. Vatsala Narendra Desai
Designation :	Director
Address :	214/215, Ramzarukha, S V Road, Andheri (West), Mumbai – 400058, Maharashtra, India
Date of Birth/Age :	24.02.1950
Date of Appointment :	31.05.2007
DIN No.:	00260673
Name :	Mr. Anupam Babubhai Desai
Designation :	Director
Address :	Ramna Falia, Dhamdachha, Taluka Gandevi, District Navsari, Navsari – 396360, Gujarat, India
Date of Birth/Age :	13.10.1962
Date of Appointment :	31.05.2007
DIN No.:	02081417

KEY EXECUTIVES

Name :	Mr. Sirosh Kumar
Designation :	Accounts Manager

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

(AS ON 30.09.2011)

Names of Shareholders	No. of Shares
Swetal Narendra Desai	74500
Vatsala Narendra Desai	108500
Anupam Babubhai Desai	2000
Total	185000

(AS ON 30.09.2011)

Equity Shares Break – up

Category	Percentage
Directors or relatives of directors	59.73
Other top fifty shareholders	40.27
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturing and Marketing of Organic and Inorganic Pigments

PRODUCTION STATUS (AS ON 31.03.2011)

Particulars	Licensed Capacity	Installed Capacity	Actual Production
Pigments	Not Applicable	1200 m. tones p.a.	1,087,491

GENERAL INFORMATION

No. of Employees :

30 (Approximately)

Bankers :

· Bank of Baroda

Bhat Bazar Branch, Adamji Building, 1^st Floor, 413, Syed Mukri Street, Masji Bandar, Mumbai – 400009, Maharashtra, India

· Citi Bank N. A.

Trent House, 2nd Floor, G Block, Plot No.C-60, Bandra Kurla Complex, Bandra (East), Mumbai - 400051,Maharashtra, India

· ICICI Bank

Facilities :

Secured Loans	31.03.2011	31.03.2010
	(Rs. In Millions)
Bank of Baroda (Secured against hypothecation of Stock and Book Debts)	21.136	4.693
Bank of Baroda – Packing credit (Secured against hypothecation of letter of credit)	28.900	22.000
Bank of Baroda – Term Loan (Secured against hypothecation of land, building, plant and machineries)	9.503	13.103
Kotak Mahindra Prime Limited (Secured against hypothecation of car)	3.738	0.941
ICICI Bank (Secured against hypothecation of car)	0.395	--
TOTAL	63.672	40.737
Unsecured Loans	31.03.2011	31.03.2010
	(Rs. In Millions)
From Directors, Shareholders and their relatives	19.160	23.254
Inter-corporate Deposits	--	--
TOTAL	19.160	23.254

Banking Relations :

--

Financial Institution :

Kotak Mahindra Prime Limited

Auditors :

Name :

A. P. Doshi and Company

Chartered Accountant

Address :

201, Bhaveshwar Complex, Vidyavihar (West), Mumbai – 400086, Maharashtra, India

Tel No.:

91-22-25146854/ 55

Email :

amit@apdoshi.com

Tel. No.:

AACPD3476H

Related Parties :

Name of Parties	Nature of Controls
Hercules Exports	Proprietory concern of a Director
Hercules Exports Private Limited	Concern where director has substantial interest
Koel Pharma Private Limited	Firm where director has substantial interest
Nitsu Chemicals Private Limited	Associate Company under the same management
Staybrite Colors Private Limited	Associate Company
Nutech Colors Private Limited	Associate Company under the same management

CAPITAL STRUCTURE

(AS ON 30.09.2011)

Authorised Capital :

No. of Shares	Type	Value	Amount
250000	Equity Shares	Rs.10/- each	Rs.2.500 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
185000	Equity Shares	Rs. 10/- each	Rs.1.850 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		1.850	1.850	1.850
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		34.479	25.802	15.768
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		36.329	27.652	17.618
LOAN FUNDS
1] Secured Loans		63.672	40.737	26.594
2] Unsecured Loans		19.160	23.254	24.661
TOTAL BORROWING		82.832	63.991	51.255
DEFERRED TAX LIABILITIES		1.842	1.886	1.503
TOTAL		121.003	93.529	70.376
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		63.549	57.712	51.158
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		0.000	0.000	0.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	25.840	20.512	19.437
	Sundry Debtors	59.632	60.073	21.453
	Cash & Bank Balances	1.978	4.051	0.267
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	33.732	17.801	9.670
Total Current Assets		121.182	102.437	50.827
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditor	52.992	60.254	31.237
	Other Current Liabilities	3.640	1.737	0.415
	Provisions	7.125	4.673	0.016
Total Current Liabilities		63.757	66.664	31.668
Net Current Assets		57.425	35.773	19.159
MISCELLANEOUS EXPENSES		0.029	0.044	0.059
TOTAL		121.003	93.529	70.376

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	GROSS RECEIPTS		373.755	318.277	117.232
Less	EXPENDITURE FOR THE YEAR		354.134	301.491	115.680
	PROFIT BEFORE TAX		19.621	16.786	1.552
Less	PRELIMINARY EXPENSES WRITTEN OFF		0.015	0.015	0.015
Less	TAX		6.600	4.574	1.519
	PROFIT AFTER TAX		13.006	12.197	0.018
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		10.051	0.018	0.000
Less	APPROPRIATIONS
		Proposed Dividend	4.328	2.164	0.000
	BALANCE CARRIED TO THE B/S		18.729	10.051	0.018
	Earnings Per Share (Rs.)		70.30	65.93	0.10

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
Return on Total Assets (PBT/Total Assets}	(%)	10.62	10.48	1.52
Return on Investment (ROI) (PBT/Networth)		0.54	0.61	0.08
Debt Equity Ratio (Total Liability/Networth)		4.04	4.72	4.70
Current Ratio (Current Asset/Current Liability)		1.90	1.54	1.60

LOCAL AGENCY FURTHER INFORMATION

SUNDRY CREDITORS DETAILS:

Particulars	31.03.2011	31.03.2010	31.03.2009
	(Rs. In Millions)
Sundry Creditors
- Creditor for Expenses	15.831	14.177	4.564
- Other Creditors	37.161	46.077	26.673
Total	52.992	60.254	31.237

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	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	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

NOTE:

The registered address of the company has been shifted from C-3, Ratandeep, 140/141, S V Road, Andheri (West), Mumbai – 400 058, Maharashtra, India to present w.e.f. 01.04.2010.

FORM 8:

This form is for	Modification of charge
Charge identification number of the modified	10329883
Corporate identity number of the company	U24100MH2007PTC171238
Name of the company	Hercules Pigments Private Limited
Address of the registered office or of the principal place of business in India of the company	402,Peninsula Heights, C. D. Barfiwala Marg, Juhu Lane, Andheri West, Mumbai – 400058, Maharashtra, India info.apdoshi@gmail.com
Type of charge	Immovable property
Particular of charge holder	Citi Bank N. A. Trent House, 2nd Floor, G Block, Plot No.C-60, Bandra Kurla Complex, Bandra (East), Mumbai – 400051, Maharashtra, India vlaxman@vsnl.com
Nature of description of the instrument creating or modifying the charge	Memorandum Recording extension of equitable mortgage to cover credit facilities sanctioned by Citi bank.
Date of instrument Creating the charge	28/03/2012
Amount secured by the charge	Rs.40.000 Millions
Brief particulars of the principal terms and conditions and extent and operation of the charge	Rate of Interest Interest to be charged at such rate/s as may be determined by the Bank from time to time. Terms of Repayment On Demand. Margin As may be stipulated by the Bank from time to time. Extent and Operation of the charge The Company accorded and gave oral consent to Bank of Baroda (BOB) and BOB acting for itself as well as agent of Citibank N.A to continue to hold and retain the title deeds (by way of Constructive delivery) in respect of its immovable properties as stated in Item No.15 as security for repayment of Rs.40.000 Millions by the Company to Citibank, with interest, costs, charges and expenses and all other money whatsoever due and payable thereon. Others The charge created/to be created on Company's immovable property in favour of Bank of Baroda for its Credit facility/ies shall rank on first pari passu basis in favour of Citibank NA without any priority of one over the other for all purposes and to all intents.
Short particulars of the property charged	Immovable property being all that Industrial Plot bearing No.316/B admeasuring 5049 sq.mtrs., in Vapi Notified Industrial Estate, bearing Revenue Survey No.621/P, 622/P, 623/P and 625/P situated lying and being at GIDC Vapi, Taluka Pardi Dist. Valsad, Gujarat State together with building and structures constructed/ being constructed thereon along with fixed plant and machinery erected/to be erected (present and future).
Particulars of the present modification	The Company created a mortgage by deposit of title deeds in respect of its immovable property being lying and situated at GIDC, Valsad (Gujarat) as further security for repayment of monies due and payable under credit facilities of Rs.40.000 Millions sanctioned by Citibank to the Company.

FIXED ASSETS:

· Leasehold Land

· Air Conditioner

· Factory Building

· Electrical Installation

· Motor car

· Scooter

· Office Equipment

· Furniture and Fixture

· Plant and Machinery

· Computer

NEWS:

FEBRUARY 18, 2011, MUMBAI

CRISIL ‘BB+’ AND ‘P4+’ FOR HERCULES PIGMENTS’ BANK FACILITIES

Rs.55.0 Million Working Capital Demand Loan*	BB+/Stable (Assigned)
Rs.10.0 Million Long-Term Loan	BB+/Stable (Assigned)
Rs.30.0 Million Letter of Credit	P4+ (Assigned)
Rs.5.0 Million Bank Guarantee	P4+ (Assigned)

* includes sub limits of cash credit to the extent of Rs.20.0 Million and packing credit to the extent of Rs.33.0 Million

CRISIL has assigned its ‘BB+/Stable/P4+’ ratings to the bank facilities of Hercules Pigments Private Limited (HPPL), part of the Hercules group. The ratings reflect the Hercules group’s exposure to risks related to a small net worth, a leveraged capital structure, and intense industry competition. These rating weaknesses are partially offset by the Hercules group’s moderate financial risk profile, marked by healthy debt protection metrics, and established presence in the pigments manufacturing business.

For arriving at its ratings, CRISIL has combined the financial risk profiles of HPPL and Hercules Pigment Industries (HPI). This is because both these entities, together referred to as the Hercules group, are in a similar line of business, with similar product and customer profiles, and owned and managed by the Desai family. Moreover, the group’s management plans to merge HPPL with HPI in the coming months.

Outlook: Stable

CRISIL believes that the Hercules group will maintain its moderate business risk profile over the medium term, backed by an established clientele and sufficient cash accruals. The outlook may be revised to ‘Positive’ if the group achieves greater-than-expected revenue growth and improves its profitability, without deteriorating its existing capital structure. Conversely, the outlook may be revised to ‘Negative’ if the Hercules group’s debt protection metrics, or capital structure, deteriorate in case of any large debt-funded capital expenditure.

About the Group

Set up in 2007 by the Desai family, the Hercules group manufactures organic yellow pigments and trades in green and blue pigments. Manufacturing activities contribute to about 85 per cent of the business, while trading activities make up the rest.

HPPL reported a profit after tax (PAT) of Rs.12.2 million on net sales of Rs.313.4 million for 2009-10 (refers to financial year, April 1 to March 31), against a PAT of Rs.0.02 million on net sales of Rs.114.6 million for 2008-09.

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.55.15
UK Pound	1	Rs.85.22
Euro	1	Rs.69.24

INFORMATION DETAILS

Information Gathered by :	SBA
Report Prepared by :	NIT

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	4
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	5
--PROFITABILIRY	1~10	4
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	5
--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		43

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.