MIRA INFORM REPORT

Report Date :

20.06.2012

IDENTIFICATION DETAILS

Name :	KRYFS POWER COMPONENTS LIMITED (w.e.f. June 2006)
Formerly Known As :	KRYFS LAMINATIONS PRIVATE LIMITED
Registered Office :	Aza House, 3^rd Floor, 24 Turner Road, Bandra (West), Mumbai – 400 050, Maharashtra
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	05.03.1991
Com. Reg. No.:	11-60602
Capital Investment / Paid-up Capital :	Rs.88.235 Millions
CIN No.: [Company Identification No.]	U25209MH1991PLC060602
TAN No.: [Tax Deduction & Collection Account No.]	MUMK10554F
PAN No.: [Permanent Account No.]	AAACK2791F
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturer and Exporter of Stacked Transformer Laminations, Cores, Lifting Slings etc.
No. of Employees :	600 (Approximately) ( In Office + In Factory)

RATING & COMMENTS

MIRA’s Rating :

Ba (52)

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

Maximum Credit Limit :	USD 6000000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is well established and a reputed company having fine track. Directors are reported to be experienced and respectable businessmen. 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 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 PARTED BY

Name :	Mr. Sameer Mogal
Designation :	Accounts Manager
Contact No.:	91-9619187237
Date :	19.06.2012

LOCATIONS

Registered Office / Corporate Office :	Aza House, 3^rd Floor, 24 Turner Road, Bandra (West), Mumbai – 400 050, Maharashtra, India
Tel. No.:	91- 22- 26443533 / 67859999 / 26443522
Mobile No.:	91-9619187237 (Mr. Sameer)
Fax No.:	91-22-67859999 / 26434462 / 67859988
E-Mail :	sales@kryfs.com abbas0854@yahoo.co.in saif.qureishi@kryfs.com sameer.mogal@kryfs.com
Website :	www.kryfs.com
Area :	1000 Sq. ft.
Location :	Owned
Factory 1 :	Kherdi Unit, Survey No. 211/1 and 193/1, Kherdi Main Road, Near HPCL, Kherdi Village, Silvassa -396230, Dadra and Nagar Haveli, Union Territory, India
Tel. No.:	91-260-2677312
Fax No.:	91-260-2677312
Area :	170000 Sq. ft.
Location :	Owned
Factory 2 :	Palghar, Plot 75, Diwan Industrial Estate, Bidco Road, Mahim Village, Palghar 401404, Maharashtra, India
Tel. No.:	91-9525-25254780
Area :	50000 Sq. ft.
Location :	Owned

DIRECTORS

As on 01.08.2011

Name :	Mr. Fakhruddin Bakirali Qureishi
Designation :	Chairman and Whole time Director
Address :	1101, DIAGO D, Sherly Rajan Road, Bandra (West), Mumbai – 400 050, Maharashtra, India
Date of Birth/Age :	19.09.1941
Date of Appointment :	05.03.1991
Qualification :	B.com
Election Commission Identity Card No.:	MT/08/036/196456
DIN No.:	00098982

Name :	Mr. Saifuddin Fakhruddin Qureishi
Designation :	Managing Director
Address :	1101, DIAGO D, Sherly Rajan Road, Bandra (West), Mumbai – 400 050, Maharashtra, India
Date of Birth/Age :	12.05.1964
Date of Appointment :	05.03.1991
Qualification :	B.Sc (Physics)
Election Commission Identity Card No.:	MT/08/036/195568
DIN No.:	00098955

Name :	Mr. Rauzat Saifuddin Qureishi
Designation :	Whole time Director
Address :	1101, DIAGO D, Sherly Rajan Road, Bandra (West), Mumbai – 400 050, Maharashtra, India
Date of Birth/Age :	01.03.1967
Date of Appointment :	19.06.2000
Qualification :	B.A.
Election Commission Identity Card No.:	MT/08/036/196459
DIN No.:	00098990

Name :	Mr. Rakesh Madanlal Nanda
Designation :	Director
Address :	Navjivan Commercial Building, 3 ‘A’ Wing, 9^th Floor, Office No.20, Mumbai Central (East), Mumbai - 400 008, Maharashtra, India
Date of Birth/Age :	07.08.1962
Date of Appointment :	18.05.2006
Qualification :	C.A.
DIN No.:	00208359

Name :	Mr. Alok Shridhar Shukla
Designation :	Director
Address :	RH-1, Om Dwarka Nath Society, Plot 11, Sector 19-A, Nerul, Navi Mumbai - 400 076, Maharashtra, India
Date of Birth/Age :	09.05.1951
Date of Appointment :	18.05.2006
Qualification :	B.Sc., 3-year Diploma in Hotel Management and PG Diploma in Personnel Management
DIN No.:	00051622

Name :	Mr. Sanjay Khatau Asher
Designation :	Director
Address :	32, Modi Street, Next to GPO, Fort, Mumbai – 400 001, Maharashtra, India
Date of Birth/Age :	26.11.1964
Date of Appointment :	18.05.2006
Qualification :	SOLICITOR, LLB and C.A.
DIN No.:	00008221

Name :	Mr. Anand Mundra
Designation :	Nominee Director
Address :	Flat No. 301, 302, 3^rd Floor, Nirmal Building, Plot No. 453, At 110 Bhawani Shankar Road, Mumbai – 400 028, Maharashtra, India
Date of Birth/Age :	13.03.1971
Date of Appointment :	25.09.2010
Qualification :	C.A.
DIN No.:	03098196

KEY EXECUTIVES

Name :	Mr. Sameer Mogal
Designation :	Accounts Manager

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 01.08.2011

Names of Shareholders	No. of Shares
Saifuddin Fakhruddin Qureishi (Joint)	4236042
Fakhruddin Bakirali Qureishi (Joint)	2363882
Kulsum Fakhruddin Qureishi	675113
Rauzat Saifuddin Quereishi	204879
Yasmin Minhaz Karachiwala	20000
Minhaz Shabbir Karachiwala	84
Reliance India Power Fund, India	1323530
Total	8823530

As on 01.08.2011

Equity Share Breakup	Percentage of Holding
Category
Venture Capital	15.00
Directors or relatives of director	85.00
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer and Exporter of Stacked Transformer Laminations, Cores, Lifting Slings etc.

Products :

Products Description	Item Code No
CRGO Transformer Laminations	85049010
Alingset Polyester Round and Webbing Slings	56090090
· Electrical Laminations · Transformer Cores and Silicon Steel Strips / Coils · Power and Distribution Transformers · Polyester Round and Webbing Slings	85049010

Exports :

Products :

Lamination Cores

Countries :

· Middle East

· USA

· Gulf Countries

Imports :

Products :

Raw Materials

Countries :

· Russia

· Korea

· Japan

Terms :

Selling :

Cash and Credit

Purchasing :

Cash and Credit

PRODUCTION STATUS (As on 31.03.2011):

Particulars	Unit	Installed Capacity	Actual Production
Electrical Lamination, Strips and Cores (Excludes scrap)	M.T.	30000.00	*28000.817
Polyester Slings	Nos.	60000	36343
Transformers	KVA	1250000	153 Nos 808815 KVA

Notes:

*Includes production on job work basis 4045.397 M. T.

GENERAL INFORMATION

Suppliers :

· POSCO-India

Customers :

Wholesalers, Retailers and OEM’s

· CROMPTON BHEI

· Finance Limited

· Bharat Bijlee Limited

· EMCO Transformers

· Kanohar Electricals Limited

· Indo Tech Transformers Private Limited

· ECE Industries Limited

· Voltamp Transformers Limited

· ABB

· Areva

· Bharat Heavy Electricals Limited

· Crompton Greaves Limited

· Kirloskar Power Equipments Limited

· Seimens

· TELK

· Vijai Electricals Limited

No. of Employees :

600 (Approximately) ( In Office + In Factory)

Bankers :

· Citibank, Fort Branch, Mumbai, Maharashtra, India

· Bank of India, Mumbai Large Corporate Banking Branch of India Building, 70/80, M G Road, Mumbai – 400 023, Maharashtra, India

· Standard Chartered Bank, Branch Fort, Mumbai, Maharashtra, India

· Kotak Mahindra Bank , Fort Branch, Mumbai, Maharashtra, India

Facilities :

Banker	Facilities	Rs. In Millions
Citibank	Overdraft / Letter on Credit	600.000
Standard Chartered Bank,	Overdraft	200.000
Bank of India	Letter on Credit	920.000
Bank of India	Cash Credit	100.000
Kotak Mahindra Bank	Cash Credit	200.000

Secured Loans	31.03.2011 Rs. In Millions	31.03.2010 Rs. In Millions
Loans Taken For Vehicles Secured	0.619	2.619
Total	0.619	2.619

Unsecured Loans	31.03.2011 Rs. In Millions	31.03.2010 Rs. In Millions
Deferred Sales Tax Loan Unsecured	2.256	2.256
Total	2.256	2.256

Banking Relations :

--

Auditors :

Name :

A.S. Kanchwalla and Associates

Chartered Accountants

Address :

203, Fine Mansion, R No.3, 3^rd Floor, Dr. D N Road, Fort, Mumbai – 400 001, Maharashtra, India

Tel. No.:

91-22-22622802

PAN No.:

AACPK1107A

Related Parties :

(As on 31.03.2010)

· Qureishi Enterprises

Address : 14, Evergreen Industrial Estate, Shanti Mills Compound, Mahalaxmi, Mumbai – 400011, Maharashtra, India

Line of Business: Trading in Mail handing equipment and cutlery items.

· Fairco Exports

Address : 101, Classic Corner, 133, Hill Road, Bandra (West), Mumbai – 400050, Maharashtra, India

Line of Business : Trading in Silicon Steel

· Tristar Manufacturing Company

· Shaali Estates (Private) Limited

· KRYFS Charitable Trust

CAPITAL STRUCTURE

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
15000000	Equity Shares	Rs.10/- each	Rs.150.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
8823530	Equity Shares	Rs.10/- each	Rs.88.235 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		88.235	88.235	88.235
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		1413.805	1176.280	1049.161
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		1502.040	1264.515	1137.396
LOAN FUNDS
1] Secured Loans		0.619	2.619	4.586
2] Unsecured Loans		2.256	2.256	2.786
TOTAL BORROWING		2.875	4.875	7.372
DEFERRED TAX LIABILITIES		50.034	42.977	31.333
TOTAL		1554.949	1312.367	1176.101
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		505.648	503.367	438.305
Capital work-in-progress		32.612	13.756	40.806
INVESTMENT		15.354	13.041	106.878
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	349.216	479.262	565.446
	Sundry Debtors	1243.066	723.633	745.990
	Cash & Bank Balances	59.489	51.088	27.590
	Other Current Assets	122.313	115.462	72.546
	Loans & Advances	33.555	45.006	45.810
Total Current Assets		1807.639	1414.451	1457.382
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	718.221	523.740	817.538
	Other Current Liabilities	64.797	64.505	28.627
	Provisions	23.286	44.003	21.105
Total Current Liabilities		806.304	632.248	867.270
Net Current Assets		1001.335	782.203	590.112
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		1554.949	1312.367	1176.101

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Net Sales	4053.412	3152.932	2715.761
		Other Income	18.592	31.829	14.579
		TOTAL (A)	4072.004	3184.761	2730.340
Less	EXPENSES
		Consumption Materials Changes Inventories	3344.307	2689.140	2572.432
		Manufacturing Service Costs	65.475	39.608
		Employee Related Expenses	80.655	52.196
		Administrative Selling Other Expenses	146.800	107.343
		TOTAL (B)	3637.237	2888.287	2572.432
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		434.767	296.474	157.908
Less	FINANCIAL EXPENSES (D)		26.795	16.441	43.553
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		407.972	280.033	114.355
Less/ Add	DEPRECIATION/ AMORTISATION (F)		40.713	34.946	18.829
	PROFIT BEFORE TAX (E-F) (G)		367.259	245.087	95.526
Less	TAX (H)		124.607	81.956	31.010
	PROFIT AFTER TAX (G-H) (I)		242.652	163.131	64.516
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		438.242	363.623	352.962
Less	APPROPRIATIONS
		Final Dividend	4.412	30.883	9.706
		Tax on Distributed Profits	0.716	5.129	1.649
		Transfer to General Reserve	68.000	52.500	42.500
	BALANCE CARRIED TO THE B/S		607.766	438.242	363.623
	EARNINGS IN FOREIGN CURRENCY
		FOB value of Exports	NA	254.936	385.640
	TOTAL EARNINGS		NA	254.936	385.640
	IMPORT VALUE		NA	1859.239	2005.044
	Earnings Per Share (Rs.)		27.50	18.49	7.31

Particulars	31.03.2012
Sales Turnover (Approximately)	5150.000

Expected Sales (2012-2013) : Rs.5500.000 millions

The above information has been parted by Mr. Sameer Mogal

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	5.96	5.12	2.36
Net Profit Margin (PBT/Sales)	(%)	9.06	7.77	3.52
Return on Total Assets (PBT/Total Assets}	(%)	15.88	12.78	5.04
Return on Investment (ROI) (PBT/Networth)		0.24	0.19	0.08
Debt Equity Ratio (Total Liability/Networth)		0.54	0.50	0.77
Current Ratio (Current Asset/Current Liability)		2.24	2.24	1.68

LOCAL AGENCY FURTHER INFORMATION

SUNDRY CREDITOR DETAILS

(Rs. In millions)

PARTICULARS	31.03.2011	31.03.2010	31.03.2009
Sundry Creditors
- Due Others	718.221	523.740	817.538

Sr. No.	Check List by Info Agents	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	YES
10.	Designation of contact person	YES
11.	Turnover of firm for last three years	YES
12.	Profitability for last three years	YES
13.	Reasons for variations <> 20%	--
14.	Estimation for coming financial year	YES
15.	Capital in the business	YES
16.	Details of sister concerns	YES
17.	Major Suppliers	YES
18.	Major Customers	YES
19.	Payment terms	YES
20.	Export / Import details (is applicable)	YES
21.	Market information	--
22.	Litigation that the firm / promoter involved in	--
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, is available	YES

change of address

The Registered Office of the company has been shifted from 101, Classic Corner, 133, Hill Road, Off St. Andrews Road, Bandra (West), Mumbai – 400 050, Maharashtra, India to the present address w.e.f. 01.11.2008.

operating results and business (As on 31.03.2010)

For the year ended 31^st March 2010, the Company earned total net income of Rs. 3184.760 millions (Gross income of Rs.3422.830 Millions) as compared to the previous year Rs.2730.340 millions (Gross Income of Rs.3008.570 Millions).

The EBITDA of the Company increased to Rs.296.470 Millions from Rs.157.910 Millions and net profit of the Company increased significantly to Rs.163.130 millions from the previous year Rs.64.520 millions.

During the financial year the production of CRGO Cores/Laminations increased in quantity terms by 36.72% from 14483.200 MT (previous year) to 19801.090 MT. The utilization of raw material has improved marginally from 93.98% to 94.10% (i.e. for every 1 MT of input of CRGO in FY 2009-10 the output was 0.941 MT of Finished goods and in FY 2008-09 the output was 0.939 MT of finished goods.

a) Foreign Exchange Gain:

During the year the company has made gain of Rs.20.800 millions compared to previous years exchange loss of Rs.93.140 millions.

b) Job Work of customer’s material:

During the financial year job working (I.e. processing of the customers material on labour basis) for customers Increased to 4516.375 MT compared to 2847.502 MT in the previous year (increase of 60.19%). Although job working does not add to the top line nor add significantly to the bottom line of the company, it is in the strategic interest of the company to do so to retain customer base and market share. Thus the company’s sales turnover has not increased in proportion to the increase in production.

CONTINGENT LIABILITIES (As on 31.03.2011)

Guarantees provided by the bank Rs.39.916 Millions, Previous year (Rs. 33.715 Millions).

Contingent Liability in respect of outstanding Letter of Credit opened by the Bank is Rs. 455.895 Millions (Previous year Rs. 441.812 Millions).

Suit filed against company not acknowledged as debt Rs. 9.575 Millions (Previous Year 9.575 Millions).

Contingent Liability in respect of bills discounted with banks which are against confirmed letter of credits received from customers Rs. 70.478 Millions (previous year 38.082 Millions)

Estimated amounts of contracts remaining to be executed in capital account and not provided for Rs.16.178 Millions (Previous year- 3.960 Millions).

Summary of disputed statutory demands not accepted by the Company is given below:

Particulars	As on 31.03.2011 Rs. in millions	As on 31.03.2010 Rs. in millions
Income Tax	35.126	6.283
Wealth Tax	0.000	0.034
Fringe Benefit Tax	0.000	0.073
Total	35.126	6.390

BANKERS CHARGES REPORT AS PER REGISTRY

Corporate identity number of the company	U25209MH1991PLC060602
Name of the company	KRYFS POWER COMPONENTS LIMITED
Address of the registered office or of the principal place of business in India of the company	Aza House, 3^rd Floor, 24 Turner Road, Bandra (West), Mumbai – 400050, Maharashtra, India E-Mail: saif.qureishi@kryfs.com
This form is for	Modification of charge
Charge identification number of the modified	10040414
Type of charge	Immovable Property
Particular of charge holder	Bank of India, Mumbai Large Corporate Banking Branch, 70/80, M G Road, Fort, Mumbai - 400023, Maharashtra, India E-Mail: Mumbai.Lcbb@bankofindia.co.in
Nature of description of the instrument creating or modifying the charge	Memorandum of entry for extension of mortgaged charged by deposit of title deed dated 7^th June, 2010 for enhanced finance facility from 1070.000 millions to 1400.000 millions.
Date of instrument Creating the charge	07/06/2010
Amount secured by the charge	Rs.1400.000 millions
Brief particulars of the principal terms an conditions and extent and operation of the charge	Rate of Interest: Interest shall be charged on the outstanding in the said Accounts(s) at such rate or rate as may be determined by the Bank form time to time. Terms of Repayment: on demand Margin: The Company shall maintain such security margin as may be stipulated by the Bank Extent and Operation of the charge: Extension of existing mortgage details as per (A) (B) and (C) given in Para No. 3 in Memorandum of Entry dated 7th June 2010. Others: The charge created/to be created by the Company on the land and building shall rank pari passu inter se the banks for all purpose and to all intents without any priority over the other or others. This security shall be a continuing security for the balance time to time due to the said banks and each of them under the said Account(s).
Short particulars of the property charged	All that piece or parcel of the non agriculture land admeasuring about 1 hectare and 52 are equivalent to 15200 sq mtrs. bearing S.No. 211/1 at Village Kherdi in the UT of Dadra and Nagar Haveli Plot No. 63 Admeasuring about 800 Sq.Yard S.No.411/1 (Part), 433/3 (Part), 433/4 (Part) At Mouje Village Taluka Mahim District Palghar Thane Plot No. 75 Admeasuring about 800 Sq.Yard S.No.411/1 (Part), 433/3 (Part), 433/4 (Part) Mouje Village Taluka Mahim District Palghar Thane S.No. 231/1 Admeasuring about 9500 Sq. Mtrs at Village Kherdi in the U T Of Dadra and Nagar Haveli. S.No.231/3, 231/2/1 Admeausuring about 0 Hectare and 60 are equivalent to 5590 Sq.Mtrs at Village Kherdi in the Ut of Dadara and Nagar Haveli S.No.193/1/1/2 Admeasuring about 7000 Sq.Mtrs at Village Kherdi in the UT of Dadra and Nagar Haveli. Premises No 302, 3rd Floor, with 2 Car Parking Space in Building known as 'Turner Road Commercial' (Aza House), Turner Road, Bandra (West), Mumbai-400 050
Date of latest modification prior to the present modification	23/09/2008
Particulars of the present modification	Additional Security by Memorandum of Entry in respect of Deposit of Title Deeds so as to cover the increased finance facility from Rs.1070.000 millions to 1400.000 millions.

TRADE REFERENCES

· POSCO-India

· Bharat Bijlee Limited

FIXED ASSETS

· Land

· Buildings

· Furniture and Fixtures

· Plant and Machinery

· Electrical Installations

· Vehicles

PRESS RELEASES:

'Future bright for transformer lamination industry'

November, 2007

A leading player in transformer core manufacture, KRYFS Power Components Limited foresees huge demand for transformer lamination in the next five years. In an interview with K Subash, the company's Managing Director Saif Qureishi says though the outlook for the lamination industry is bright, he expects some hiccups along the way, but will make the journey more enjoyable and challenging for him. He aims to retain his leading position in the transformer lamination industry, and also add a few more higher value-added products in the near future. Excerpts:

You claim to have two modern plants for manufacturing transformer core. Are you in an advantageous position than others in this field? If yes then how?

It has been an interesting journey from when we started KRYFS Laminations (Private) Limited in December 1992, producing 10 MT per month. The major player in this industry then was Guest Keen Williams (GKW), and there were also many other players in the field who were mainly from the unorganised sector. By the end of this year, we shall have a capacity to produce 24,000 MT per annum, which is a huge leap forward. Maximum production will be achieved with imported CNC Georg (German) cut to length lines. Today, we are the only manufacturer of transformer core in the country to have 4 CNC Georg cut to length lines, 1 Georg slitting machine and 2 SDRI imported slitting machines. In addition, in December 2007, we will have a Brock-haus Magnetic steel testing laboratory at our works. Georg, Germany, is the world leader in transformer lamination CNC lines and Brockhaus, Germany, is the world leader in magnetic material testing technology. Obviously, having the best equipment in the world coupled with an enabling working culture ensures better processes and therefore better products. CRGO is a very sensitive steel and is also called the "glass steel". If the material is handled too often, the losses of the material increase and therefore it was a con-scious decision to go in for automation.

Being a company into the manufacture of CRGO strips what are the grades of CRGO you use?

We use all grades of CRGO from almost all suppliers in the world. We use the conventional grades of material like M3, M4, M5 and M6, and also use all Hi-B Domain refined grades of POSCO, TKES, Nippon Steel and A.K.Steel. In fact, we are the only lamination manufacturer in India to receive material from Posco's India Processing Centre for conversion into Laminations. All other POSCO material available in India from any other source is through the non-POSCO-approved route or the unofficial route. It is an established fact that H1B grade is considered to be the best among the

CRGO grades. What have you to say about this?

Of course, Hi-B grade of material has the lowest core loss and since the development of CRGO in the mid-1900s all producing mills have made significant improvements in the manufacturing technology of CRGO, leading to materials with lower losses. Hi-B materials not only offer lower no-load losses to the designer but are also designed to operate at a much higher flux density, therefore reducing the overall size of the transformer. However, the Hi-B material availability and pricing are an issue. As it is a closely-held technology, only four countries and five mills in the world make this Hi-B Domain refined material namely A.K. Steel (USA), POSCO (Korea), Nippon and Kawasaki (Japan) and TKES (Germany). Therefore, the price is high and many transformer manufacturers and utilities are rethinking the cost benefit analysis of paying higher capital costs versus bearing the cost of higher no-load losses during the life of the transformer. In my view, where a transformer is going to be continuously loaded for 50 per cent or more times like in distribution transformers, Hi-B material may not be economical to use. However, for Power transformers in rural areas, which may not be loaded intermittently or less than 50 per cent of the time, Hi-B material may make economic sense.

Are the manufacturers still facing problems in sourcing Hl-B grade CRGO? Do you use this grade?

Yes, Hi-B CRGO is still in short supply in the world due to the high demand for this grade of material. We regularly use this material as most of our customers are the top power transformer manufacturers in India and abroad, and have a regular need for this grade of material.

You had been honoured with export awards twice. What are the products you export and which are your prospective markets?

KRYFS had been honoured with the EEPC Export Excellence award for outstanding export performance in 2004-'05 and the EEPC All-India Star Performer Award for export excellence in 2005-'06. We export our products to more than 30 countries all over the world including USA, China, Far East, Middle East and African countries.

Reliance India Power Fund had bought 15 per cent stake in your company. In what way did it help?

Well, the first thing it did was to boost our confidence. When a prestigious fund like the Reliance India Power Fund, which is held in equal measure by two of the most respected financial Powerhouses like Reliance Capital and Temasek, choose to invest in our company, it is a vote of confidence in your operations and your company's ability to compete in the market place. The investment in KRYFS was also one of the fastest investments made by the Reliance India Power fund in the sense that from the first meeting to the signing of the agreement, including the due diligence, took just 90 days.

Second, it has given us the capital to grow our business aggressively and also modernise our business by installing the latest machinery. Third, it has also made us a more responsible corporate citizen by bringing in better systems and transparency in our operations.

With the government setting a target of 78,500 MW capacity addition in the Eleventh Five-Year Plan how do you foresee the prospects for your business?

Let us put it this way - If the Indian economy has to grow at around 8 to 9 per cent per annum, the Power sector has to grow at around 13 to 15 per cent (to make up for the existing deficit plus new demand). If the Power sector has to grow at this rate, transformers have to be installed at a rate, which are higher than the rate of installation of generation capacity. As a thumb rule, 1 MW of generation capacity will require an addition of 7 MVA of transformers in the system. If transformers have to be manufactured, core has to be produced as that is the heart of the transformer. 1 MVA of transformer typically requires 1 MT of CRGO transformer lamination. Therefore, for a 78,500 MW addition in the generation capacity in the 11th Five-Year Plan, the new transformer requirement will be of the order of 549,500 MVA, and the requirement over a five-year period for transformer laminations will be around 550,000 MT. This is in addition to the replacement demand of existing transformers. So the future does look bright, however, we expect some hiccups along the way too, but that should only make the journey more enjoyable and challenging.

What are your future plans for the company?

We plan to get into related products in the Power sector and grow our company organically and inorganically. We hope to retain our leading position in the transformer lamination industry and also add a couple of higher value-added products by forward integration in the near future.

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.56.01
UK Pound	1	Rs.87.85
Euro	1	Rs.70.54

INFORMATION DETAILS

Information Gathered by :	SVA
Report Prepared by :	BSN

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	5
--RESERVES	1~10	6
--CREDIT LINES	1~10	6
--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	Yes
--AFFILIATION	YES/NO	Yes
--LISTED	YES/NO	No
--OTHER MERIT FACTORS	YES/NO	Yes
TOTAL		52

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.