MIRA INFORM REPORT

 

 

Report Date :

26.06.2012

 

IDENTIFICATION DETAILS

 

Name :

POLYSPIN EXPORTS LIMITED

 

 

Registered Office :

No. 351, P.A.C.R. Salai, Rajapalayam-626 117, Tamilnadu

 

 

Country :

India

 

 

Financials (as on) :

31.03.2011

 

 

Date of Incorporation :

29.03.1985

 

 

Com. Reg. No.:

011683

 

 

Capital Investment / Paid-up Capital :

Rs.40.000 Millions

 

 

CIN No.:

[Company Identification No.]

L51909TN1985PLC011683

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

MRIP00514D

 

 

PAN No.:

[Permanent Account No.]

AAACP9339C

 

 

Legal Form :

A Public Limited Liability company. The company’s Shares are Listed on the Stock Exchange.

 

 

Line of Business :

Manufacturer, Exporter and Supplier of PP Woven FIBC Bags

 

 

No. of Employees :

150 (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 320000

 

 

Status :

Satisfactory

 

 

Payment Behaviour :

Usually correct

 

 

Litigation :

Clear

 

 

Comments :

Subject is an established company having satisfactory track. Trade relations are reported to be fair. Business is active. Payments are reported to be usually correct and as per commitments.

The company can be considered normal for business dealing 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

 

 

 

 

 

 

 

 

 

 

 

 

 

LOCATIONS

 

Registered Office :

No. 351, P.A.C.R. Salai, Rajapalayam-626 117, Tamilnadu, India

Tel. No.:

91-4563-221554

Fax No.:

Not Available

E-Mail :

pelpack@bsnl.in

polyspin@vsnl.com

 

 

Factory and Administrative Office :

1, Railway Feeder Road, Cholapuram South – 626 139, Tamilnadu, India 

Tel. No.:

91-4563-284503 / 280503 / 284504

Fax No.:

91-4563-284505

E-Mail :

polyspin@vsnl.com

 

 

Corporate Office :

No.7/13, Opposite to Ramachandra Medical Centre, Bawa Road, Alwarpet, Chennai – 600 018, Tamilnadu, India

Tel. No.:

91-44-24996988

 

 

DIRECTORS

 

As on 31.03.2011

 

Name :

Mr. A. Rammohan Raja

Designation :

Managing Director

Date of Birth/Age:

67 Years

Qualification:

B.Sc.

Experience:

21 Years

Date of Appointment:

29.03.1985

 

 

Name :

Mr. K. Lakshmi Narayanan

Designation :

Director

 

 

Name :

Mr. S. R. Subramanian

Designation :

Director

 

 

Name :

Mr. P. K. Ramasubramanian

Designation :

Director

 

 

Name :

Mr. A. Thiruppathy Raja

Designation :

Director

 

 

Name :

Mr. S. Shankar

Designation :

Director

Date of Birth/Age:

54 Years

Qualification:

F.C.A.

Date of Appointment:

06.07.2001

 

 

Name :

Mr. S. V. Ravi

Designation :

Director

Date of Birth/Age:

52 Years

Qualification:

B.A.

Date of Appointment:

27.11.1992

 

 

Name :

Mr. R Ramji

Designation :

Joint Managing Director

 

 

KEY EXECUTIVES

 

Name :

Mr. P. S. Ramanathan

Designation :

Secretary

Qualification :

B.Com, B.L., A.C.S.

 

 

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

 

As on 31.03.2012

 

Names of Shareholders

No. of Shares

Percentage of Holding

(A) Shareholding of Promoter and Promoter Group

 

 

(1) Indian

 

 

Individuals / Hindu Undivided Family

1,002,428

25.06

Bodies Corporate

613,300

15.33

Sub Total

1,615,728

40.39

(2) Foreign

 

 

Total shareholding of Promoter and Promoter Group (A)

1,615,728

40.39

(B) Public Shareholding

 

 

(1) Institutions

 

 

(2) Non-Institutions

 

 

Bodies Corporate

63,426

1.59

Individuals

 

 

Individual shareholders holding nominal share capital up to Rs. 0.100 million

1,902,514

47.56

Individual shareholders holding nominal share capital in excess of Rs. 0.100 million

416,196

10.40

Any Others (Specify)

2,136

0.05

Any Other

1,936

0.05

Clearing Members

200

0.01

Sub Total

2,384,272

59.61

Total Public shareholding (B)

2,384,272

59.61

Total (A)+(B)

4,000,000

100.00

(C) Shares held by Custodians and against which Depository Receipts have been issued

-

-

        (1) Promoter and Promoter Group

-

-

        (2) Public

-

-

  Sub Total

-

-

Total (A)+(B)+(C)

4,000,000

-

 

 

BUSINESS DETAILS

 

Line of Business :

Manufacturer, Exporter and Supplier of PP Woven FIBC Bags

 

 

Products :

Product Description

ITC Code

PP Woven FIBC Bags

3923

 

 

PRODUCTION STATUS AS ON 31.03.2011

 

 

 

Particulars

31.03.2011

31.03.2010

A.

Licensed Capacity

 

 

 

PP Woven FIBC Bags, Paper Bags, PP Woven Fabric and Yam

Licensing requirement is not applicable to the company

B.

Installed Capacity

 

 

 

PP Woven FIBC Bags, Paper Bags, PP Woven Fabric and Yam

5500 Tons

per annum

2400 Tons

per annum

 

C. Actual Production:

 

Production

Unit

31.03.2011

31.03.2010

PP Woven FIBC Bags

KGS

33,45,085

26,29,906

PP Woven fabrics

KGS

14,008

1,52,249

PP Yarn

KGS

6,41,251

4,31,335

Paper Bags

KGS

--

23,073

 

 

GENERAL INFORMATION

 

No. of Employees :

150 (Approximately)

 

 

Bankers :

City Union Bank Limited, Rajapalayam, Tamilnadu, India

 

 

Facilities :

Secured Loan

As on

31.03.2011

(Rs. in

Millions)

As on

31.03.2010

(Rs. in

Millions)

I) From City Union Bank

 

 

a) Term Loan

63.690

7.389

b) Export Packing Credit

33.627

34.015

c) Foreign Bills Discounted

22.255

24.842

d) Buyers Credit

39.787

0.000

e) Cash Credit on Raw Material and Book debts

14.850

4.011

II) Loan against Term Deposit from Axis Bank

0.000

0.867

III) Others

 

 

Hire Purchase Loan

0.334

0.711

Total

174.543

71.835

Note:

i)                     Rupee Term Loan and Working capital finance from Bank is secured by a First charge, by way of equitable mortgage, of specified land and hypothecation of specified assets under this loan.

ii)                   Working Capital Finance from Bank is further secured by hypothecation of all Current Assets of the company.

iii)                  The loans are additionally secured by Personal Guarantee of two Directors of the company.

iv)                  Hire Purchase Loan is secured by hypothecation of Specified Vehicle purchased under the scheme.

Unsecured Loan

As on

31.03.2011

(Rs. in

Millions)

As on

31.03.2010

(Rs. in

Millions)

Fixed Deposits

12.049

13.206

Total

12.049

13.206

 

 

 

 

Banking Relations :

--

 

 

Auditors :

 

Name :

M/s. Krishnan and Raman

Chartered Accountant

Address :

Rajapalayam, Tamilnadu, India

 

 

Associates Companies :

Ř       Ployspin Limited

Ř       Lankaspin Private Limited, Srilanka

Ř       Chola Packaging Limited

Ř       Ganesh Agro Pack Private Limited

Ř       Energyspin Private Limited

Ř       Ramona Filaments

Ř       Ramona Industries

 

 

Subsidiaries :

Polyspin USA Incorporation, USA

 

 

CAPITAL STRUCTURE

 

As on 31.03.2011

 

Authorised Capital :

No. of Shares

Type

Value

Amount

 

 

 

 

5000000

Equity Shares

Rs.10/- each

Rs.50.000 Millions

 

Issued, Subscribed & Paid-up Capital :

No. of Shares

Type

Value

Amount

 

 

 

 

4000000

Equity Shares

Rs.10/- each

Rs.40.000 Millions

 

 

FINANCIAL DATA

[all figures are in Rupees Millions]

 

ABRIDGED BALANCE SHEET

 

SOURCES OF FUNDS

 

31.03.2011

31.03.2010

31.03.2009

SHAREHOLDERS FUNDS

 

 

 

1] Share Capital

40.000

40.000

40.000

2] Share Application Money

0.000

0.000

0.000

3] Reserves & Surplus

42.409

32.145

26.838

4] (Accumulated Losses)

0.000

0.000

0.000

NETWORTH

82.409

72.145

66.838

LOAN FUNDS

 

 

 

1] Secured Loans

174.543

71.835

44.453

2] Unsecured Loans

12.049

13.206

14.826

TOTAL BORROWING

186.592

85.041

59.279

DEFERRED TAX LIABILITIES

6.392

0.942

1.197

 

 

 

 

TOTAL

275.393

158.128

127.314

 

 

 

 

APPLICATION OF FUNDS

 

 

 

 

 

 

 

FIXED ASSETS [Net Block]

136.841

71.772

68.322

Capital work-in-progress

0.000

0.000

0.000

 

 

 

 

INVESTMENT

6.063

6.063

5.965

DEFERREX TAX ASSETS

 

 

 

 

 

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

 

 

 

Inventories
82.731

38.882

31.451

 

Sundry Debtors
52.233

48.952

24.989

 

Cash & Bank Balances
22.616

16.419

14.168

 

Other Current Assets
0.000

0.000

0.000

 

Loans & Advances
34.692

27.720

20.475

Total Current Assets
192.272

131.973

91.083

Less : CURRENT LIABILITIES & PROVISIONS

 

 

Sundry Creditors
 

 

 

Other Current Liabilities
29.237

26.118

22.630

 

Provisions
30.546

25.562

15.426

Total Current Liabilities
59.783

51.680

38.056

Net Current Assets
132.489

80.293

53.027

 

 

 

 

MISCELLANEOUS EXPENSES

0.000

0.000

0.000

 

 

 

 

TOTAL

275.393

158.128

127.314

 

 

 

 

PROFIT & LOSS ACCOUNT

 

 

PARTICULARS

31.03.2011

31.03.2010

31.03.2009

 

SALES

 

 

 

 

 

Income

444.675

349.580

385.154

 

 

Other Income

5.094

2.161

1.171

 

 

TOTAL                                     (A)

449.769

351.741

386.325

 

 

 

 

 

Less

EXPENSES

 

 

 

 

 

Raw Material Consumed

301.372

217.562

241.901

 

 

Stores and Spares Consumed

15.522

8.858

9.713

 

 

Power and Fuel

24.565

13.123

11.290

 

 

Salaries and Wages

39.666

31.724

29.098

 

 

Other Manufacturing Expenses

13.248

11.481

12.336

 

 

Administrative, Selling and Other Overheads Expenses

35.099

37.614

39.387

 

 

(Increase) / Decrease in Stock

(32.495)

(0.977)

13.918

 

 

TOTAL                                     (B)

396.977

319.385

357.643

 

 

 

 

 

Less

PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B)      (C)

52.792

32.356

28.682

 

 

 

 

 

Less

FINANCIAL EXPENSES                         (D)

16.560

6.273

8.305

 

 

 

 

 

 

PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D)                                       (E)

36.232

26.083

20.377

 

 

 

 

 

Less/ Add

DEPRECIATION/ AMORTISATION                     (F)

11.141

7.151

7.737

 

 

 

 

 

 

PROFIT BEFORE TAX (E-F)                               (G)

25.091

18.932

12.640

 

 

 

 

 

Less

TAX                                                                  (I)

10.450

8.945

4.634

 

 

 

 

 

 

PROFIT AFTER TAX (G-I)                                  (J)

14.641

9.987

8.006

 

 

 

 

 

Add

Excess Depreciation Withdrawn relevant to Previous Year

0.287

0.000

0.000

 

 

 

 

 

Add

PREVIOUS YEARS’ BALANCE BROUGHT FORWARD

2.045

0.738

0.476

 

 

 

 

 

Less

APPROPRIATIONS

 

 

 

 

 

Transfer to General Reserve

10.000

4.000

4.000

 

 

Dividend

4.000

4.000

3.200

 

 

Tax on Dividend

0.664

0.680

0.544

 

BALANCE CARRIED TO THE B/S

2.309

2.045

0.738

 

 

 

 

 

 

EARNINGS IN FOREIGN CURRENCY

 

 

 

 

 

Export Earnings

406.075

311.082

352.262

 

TOTAL EARNINGS

406.075

311.082

663.344

 

 

 

 

 

 

IMPORTS

 

 

 

 

 

Raw Materials and Consumable Stores

244.525

141.335

93.078

 

 

Capital Goods

0.871

0.000

0.303

 

TOTAL IMPORTS

245.396

141.335

93.381

 

 

 

 

 

 

Earnings Per Share (Rs.)

3.66

2.50

2.00

 

 

QUARTERLY / SUMMARISED RESULTS

 

PARTICULARS

 

30.06.2011

30.09.2011

31.12.2011

31.03.2012

Net Sales

171.730

165.280

138.720

101.610

Total Expenditure

154.610

150.210

122.990

91.520

PBIDT (Excl OI)

17.120

15.070

15.730

10.090

Other Income

0.380

0.490

0.760

0.740

Operating Profit

17.500

15.560

16.490

10.830

Interest

5.100

5.360

5.320

5.280

PBDT

12.400

10.200

11.170

5.550

Depreciation

3.680

3.900

3.790

4.150

Profit Before Tax

8.720

6.310

7.380

1.400

Tax

2.680

2.170

2.560

0.480

Profit After Tax

6.040

4.140

4.820

0.920

Net Profit

6.040

4.140

4.820

0.920

 

 

KEY RATIOS

 

PARTICULARS

 

 

31.03.2011

31.03.2010

31.03.2009

PAT / Total Income

(%)

3.25

2.84

2.07

 

 

 

 

 

Net Profit Margin

(PBT/Sales)

(%)

5.64

5.41

3.28

 

 

 

 

 

Return on Total Assets

(PBT/Total Assets}

(%)

7.62

9.29

7.93

 

 

 

 

 

Return on Investment (ROI)

(PBT/Networth)

 

0.30

0.26

0.19

 

 

 

 

 

Debt Equity Ratio

(Total Liability/Networth)

 

2.99

3.01

1.46

 

 
 

 

 

Current Ratio

(Current Asset/Current Liability)

 

3.22

1.64

2.39

 

 

LOCAL AGENCY FURTHER INFORMATION

 

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

No

5) Type of Business

Yes

6) Line of Business•

Yes

7) Promoter’s background

--

8) No. of employees

Yes

9) Name of person contacted

No

10) Designation of contact person

No

11) Turnover of firm for last two years

Yes

12) Profitability for last two 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)

Yes

21) Market information

--

22) Litigations that the firm / promoter

--

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

No

 

 

COMPANY HISTORY:

 

Sunject is an India-based company. The Company is engaged in the manufacturing of polypropylene (PP) woven flexible intermediate bulk container (FIBC) bags. These bags are air permeable and are widely used in developed countries for packing vegetables. The company is a 100% export-oriented unit (EOU). Presently, the company is engaged in the manufacture of HDPE/PP woven, circular, flat and label bags and HDPE/PP polyknit bags. The plant of the company is located at Rajapalayam, Tamil Nadu. It has an installed capacity to manufacture 2,400 tons of PP woven FIBC bags. Polyspin Exports was incorporated as a private limited company on March 29, 1985. It was converted into a public limited company January 19, 1993. During the fiscal year ended March 31, 2010 (fiscal 2010), the Company had a production of 26, 29,906 kilograms of PP woven FIBC bags. Polyspin USA Inc. is the Company is wholly owned subsidiary. As of March 31, 2010, the Company had an installed capacity of 2,400 per annum of PP woven FIBC bags, paper bags, PP woven fabrics and yarn.

 

MANAGEMENT DISCUSSION AND ANALYSIS:

 

REVIEW OF THE OPERATION:

 

PRODUCTION AND SALES:

 

The Production and Sale of the company’s products, PP Woven FIBC bags were as follows:

 

Particulars

31.03.2011

31.03.2010

Production (KGS)

33,45,085

26,29,906

Sales (KGS)

32,73,274

26,69,711

 

The Global economy continues to recover but with minor setback. The recovery is also uneven. In spite of the fact that the growth rate is higher in India  and other developing countries and low in Europe and  USA,  The company was able to achieve a better performance in the export market.
 
This is mainly due to the adoption of certain strategy  in  the  Export  market.  Constant up gradation of quality and effecting timely supplies  has  made  the  company  to  perform well even against  the  existence  of  many hurdles. 
 
The company remains cautiously optimistic and constantly adopting positive approaches. The commodity inflation particularly oil, the source of raw material for the company`s products remains a cause of concern. 
 
EXPANSION:
 
The expansion of the existing production facilities has been completely implemented. The full effect will be reflected in the financial year 2011- 2012. The capacity has been increased from 2400 tons per annum to 5500 tons per annum. 
 
OVERSEAS OPERATIONS - POLYSPIN USA INC., USA.
 
Performance of the Company`s Wholly Owned USA Subsidiary during the year, recorded improvements in terms of sales. 
The Net sales were USD 249,539/- (Rs. 11.229 Millions) as against USD 54,361/- (Rs.2.446 Millions) during the corresponding previous year. 
 
The Company expects the substantial improvements in terms of Sales and Profitability during the Current year. 
 
DIVERSIFICATION:
 
After  a very careful in depth study of the market conditions of "Open  End  Spinning  yarn", both domestic and overseas, the company has  started  the  establishment of a new unit to manufacture Open End Spinning yarn under the  name  and  style "PEL TEXTILES" (A division of Polyspin Exports  Limited)  The  presence  of the company in about 15 countries around the world is  crucial  advantage.  Necessary infrastructure facilities are being created for producing 1800 tons per year at total cost of Rs.100.000 millions. The entire project cost will be financed by internal accruals and Bank finance. 
 
Except for unforeseen circumstances, the project will be implemented before the end of this financial year. The impact is likely to reflect partially in this financial year and fully in the financial year 2012-13.

 

 

 

SUBSIDIARIES:
 
The Ministry of Corporate Affairs, Government of India, vide their General Circular No. 2/2011 dated 08.02.2011 has granted exemption u/s 212 (8) of the  Companies  Act, from attaching the full text of Financial Statement of  the  Subsidiaries subject to certain conditions being fulfilled. 
 
The Annual  accounts of the Subsidiary Company Polyspin USA Inc.  and  the  related  information  shall be made available to the  shareholders  of  the  holding  and subsidiary companies seeking such information at any point  of  time.  
 
The Annual accounts of the Subsidiary Company are also kept for inspection by any shareholders at the Registered Office of the Holding company.

 

CONTINGENT LIABILITIES NOT PROVIDED FOR:

 

 

PARTICULARS

31.03.2011

(Rs. in Millions)

i)

Unexpired Letter of credit

6.859

ii)

Bank Guarantee

1.000

 

Total

7.859

 

 

FIXED ASSETS:

 

·         Land

·         Building

·         Plant and Machinery

·         Furniture and Fittings

·         Vehicles

·         Office Equipment

·         Library

 

 

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.56.53

UK Pound

1

Rs.88.09

Euro

1

Rs.70.83

 

 

INFORMATION DETAILS

 

Report Prepared by :

DPTP

 

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

5

--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

YES

--AFFILIATION

YES/NO

YES

--LISTED

YES/NO

YES

--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.