MIRA INFORM REPORT

Report Date :

01.03.2012

IDENTIFICATION DETAILS

Name :	VXL INSTRUMENTS LIMITED
Registered Office :	House of Excellence No. 17, Electronics City, Hosur Road, Bangalore – 560 100, Karnataka
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	28.02.1986
Com. Reg. No.:	08-007492
Capital Investment / Paid-up Capital :	Rs.133.353 Millions
CIN No.: [Company Identification No.]	L85110KA1986PLC007492
TAN No.: [Tax Deduction & Collection Account No.]	BLRV00109E
PAN No.: [Permanent Account No.]	AAACV4734D
Legal Form :	Public Limited Liability Company. Company’s shares are listed on Stock Exchanges.
Line of Business :	Manufacturers and Providers of Thin Client Devices.
No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

B (28)

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Maximum Credit Limit :	USD 1400000
Status :	Moderate
Payment Behaviour :	Slow
Litigation :	Clear
Comments :	Subject is an established company having moderate track. There appears huge accumulated losses recorded by the company. However, trade relations are reported as fair. Business is active. Payments are reported to be slow. The company can be considered for business dealings with some caution.

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 / Factory 1 :	House of Excellence No. 17, Electronics City, Hosur Road, Bangalore-560100, Karnataka, India
Tel. No.:	91-80-28520046 / 36832705 / 28523252
Fax No.:	91-80-28520095
E-Mail :	narayanbhat@vsl.net
Website :	http://www.vxl.net
Branches:	Located At: Mumbai Bangalore Secunderabad Kochi New Delhi Lucknow Kolkata Chennai
Overseas Offices:	Located At: Manchester Germany Tomball Paris

DIRECTORS

AS ON 31.03.2011

Name :	Mr. Arun Kumar Bhuwania
Designation :	Chairman
Name :	Mr. D. S. Rao
Designation :	Vice Chairman
Name :	Mr. M. V. Nagaraj
Designation :	Managing Director
Name :	Mr. M. V. Shetty
Designation :	Whole Time Director
Name :	Mr. K. Prakash
Designation :	Director

KEY EXECUTIVES

Name :	Mr. Narayan Bhat
Designation :	Chide Finance Officer and Company Secretary
AUDIT COMMITTEE :	Mr. K Prakash-Chairman Mr. D S Rao-Member Mr. M V Nagaraj-Member
REMUNERATION COMMITTEE :	Mr. D S Rao-Chairman Mr. K Prakash-Member
INVESTORS' GRIEVANCES COMMITTEE :	Mr. K Prakash-Chairman Mr. M V Shetty-Member
SHARE TRANSFER COMMITTEE :	Mr. M V Shetty-Chairman Mr. M V Nagaraj-Member

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 31.12.2011

Category of Shareholders	No. of Shares	% of No. of Shares
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	1,421,020	10.67
Sub Total	1,421,020	10.67
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	1,421,020	10.67
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	3,000	0.02
Financial Institutions / Banks	900	0.01
Foreign Institutional Investors	48,150	0.36
Sub Total	52,050	0.39
(2) Non-Institutions
Bodies Corporate	1,681,497	12.62
Individuals
Individual shareholders holding nominal share capital up to Rs.0.100 Million	1,168,522	8.77
Individual shareholders holding nominal share capital in excess of Rs.0.100 Million	779,442	5.85
Any Others (Specify)	8,219,969	61.70
Clearing Members
Foreign Corporate Bodies	7,585,600	56.94
Foreign Nationals	437,600	3.28
Non Resident Indians	196,668	1.48
Sub Total	11,849,430	88.94
Total Public shareholding (B)	11,884,380	89.33
Total (A)+(B)	13,322,500	100.00

BUSINESS DETAILS

Line of Business :

Manufacturers and Providers of Thin Client Devices.

Products :

Product Description	Item Code
Data Processing Units	8471 50 00
Information Technology Software	8523 80 20

PRODUCTION STATUS (AS ON 31.03.2011)

Particulars	Unit	Installed Capacity	Actual Production
Data Processing Units	Nos.	120000	74095

Note:

* Certified by the Managing Director.

Actual production excludes bought out items / components

GENERAL INFORMATION

No. of Employees :

Not Available

Bankers :

State Bank of India

Facilities :

Secured Loan	Rs. In Millions 31.03.2011	Rs. In Millions 31.03.2010
Working Capital from a Bank	87.760	91.913
Hire Finance from a Bank for purchase of Vehicles	0.437	0.769
Total	88.197	92.682
Notes: 1. Working Capital from a Bank is secured by hypothecation of Inventories, Receivables, Book-Debts and other Current Assets, Equitable Mortgage of Factory Land and Building and immovable property of the company and charge on unencumbered Plant and Machinery and personal guarantee of some of the Directors. 2. Installments of vehicle loan due within a year Rs. 0.371 Million (Rs. 0.331 Million)
Unsecured Loan	Rs. In Millions 31.03.2011	Rs. In Millions 31.03.2010
Fixed Deposits
From – Directors	2.135	2.835
From Companies	280.392	280.392
Total	282.527	283.227

Banking Relations :	--
Auditors :
Name :	Ishwar and Gopal Chartered Accountant
Address :	Bangalore, Karnataka, India
Wholly Owned Subsidiary :	XLnet Software Systems Limited
Subsidiaries :	VXL Instruments Limited (UK)
Associates :	VXL eTech Limited

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
13350000	Equity Shares	Rs.10/- each	Rs. 133.500 Millions
Less	Allotment and call money in arrears – other than directors		Rs. 0.147 Millions
	Total		Rs. 133.353 Millions

Notes:

Of the above,

a) 2,326,830 Equity Shares of Rs.10/- each allotted as bonus shares by Capitalisation of free reserves and Share Premium Account.

b) 273,360 Equity Shares of Rs.10/- each issued pursuant to a scheme of amalgamation without payment being received in cash.

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		133.353	133.353	66.747
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		451.087	377.627	375.385
4] (Accumulated Losses)		(216.562)	(247.450)	(251.110)
NETWORTH		367.878	263.530	191.022
LOAN FUNDS
1] Secured Loans		88.197	92.682	105.194
2] Unsecured Loans		282.527	283.227	368.711
TOTAL BORROWING		370.724	375.909	473.905
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		738.602	639.439	664.927
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		325.891	247.671	246.345
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		5.229	5.220	6.495
DEFERREX TAX ASSETS		100.405	106.268	112.019
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	243.686	209.140	172.287
	Sundry Debtors	263.658	290.525	373.711
	Cash & Bank Balances	16.919	24.842	22.472
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	13.315	13.046	14.651
Total Current Assets		537.578	537.553	583.121
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	84.581	108.648	127.547
	Other Current Liabilities	140.411	141.935	149.144
	Provisions	5.509	6.690	6.362
Total Current Liabilities		230.501	257.273	283.053
Net Current Assets		307.077	280.280	300.068
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		738.602	639.439	664.927

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Income	933.899	766.040	803.808
		Other Income	19.747	8.722	3.047
		TOTAL (A)	953.646	774.762	806.855
Less	EXPENSES
		Cost of Materials	762.829	653.759	664.575
		Employee Related Expenses	22.357	22.613	18.524
		Other Expenses	85.678	53.221	74.337
		TOTAL (B)	870.864	729.593	757.436
Less	PROFIT / (LOSS) BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		82.782	45.169	49.419
Less	FINANCIAL EXPENSES (D)		36.771	30.313	34.359
	PROFIT / (LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		46.011	14.856	15.060
Less/ Add	DEPRECIATION/ AMORTISATION (F)		14.849	11.482	11.865
	PROFIT / (LOSS) BEFORE TAX (E-F) (G)		31.162	3.374	3.195
Less	TAX (H)		0.000	0.000	23.726
	PROFIT / (LOSS) AFTER TAX (G-H) (I)		31.162	3.374	(20.531)
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		(247.450)	(251.109)	(230.578)
Less/ Add	EXCESS PROVISION FOR TAXATION WITHDRAWN		(0.274)	0.285	0.000
	BALANCE CARRIED TO THE B/S		(216.562)	(247.450)	(251.109)
	EARNINGS IN FOREIGN CURRENCY
		Direct Export	0.135	0.519	2.098
		Deemed Exports through others	840.586	676.399	704.262
	TOTAL EARNINGS		840.721	676.918	706.360
	IMPORTS
		Raw Materials	821.139	641.545	674.098
	TOTAL IMPORTS		821.139	641.545	674.098
	Earnings / (Loss) Per Share (Rs.)		2.34	0.28	(3.07)

QUARTERLY RESULTS

PARTICULARS	30.06.2011	30.09.2011	31.12.2011
	1^st Quarter	2^nd Quarter	3^rd Quarter
Net Sales	254.200	214.600	157.900
Total Expenditure	233.700	204.900	146.800
PBIDT (Excl OI)	20.500	9.700	11.100
Other Income	4.900	4.900	0.100
Operating Profit	25.400	14.600	11.200
Interest	7.100	5.900	7.100
Exceptional Items	0.000	0.000	0.000
PBDT	18.300	8.700	4.100
Depreciation	3.000	3.000	3.000
Profit Before Tax	15.300	5.700	1.100
Tax	0.000	0.000	0.00
Provisions and contingencies	0.000	0.000	0.000
Profit After Tax	15.300	5.700	1.100
Extraordinary Items	0.000	0.000	0.000
Prior Period Expenses	0.000	0.000	0.000
Other Adjustments	0.000	0.000	0.000
Net Profit	15.300	5.700	1.100

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	3.27	0.44	(2.54)
Net Profit Margin (PBT/Sales)	(%)	3.34	0.44	0.40
Return on Total Assets (PBT/Total Assets}	(%)	3.23	0.38	0.39
Return on Investment (ROI) (PBT/Networth)		0.08	0.01	0.02
Debt Equity Ratio (Total Liability/Networth)		1.63	2.40	3.96
Current Ratio (Current Asset/Current Liability)		2.33	2.09	2.06

LOCAL AGENCY FURTHER INFORMATION

YEAR UNDER REVIEW

During the year, the Company achieved a net turnover of Rs. 953.600 Millions as compared to Rs. 774.700 Millions in the previous financial year. The Company has earned a profit after taxation of Rs. 30.900 Millions in the financial year as against Rs. 3.100 Millions profits in the previous year. Sales of thin clients have grown from 40,000 units during 2009-10 to 74,000 units during 2010-11, registering a growth of 85 %.

The company is confident that the improved export business would ensure a turnaround in the company’s operations.

OVERSEAS OPERATIONS

The Company continues the tie up with Priya Limited for providing support in Logistics and Distribution of its products in Europe and USA.

VXL-UK has been able to extend good support in terms of marketing of the Company’s products in Europe and especially in USA during the year.

Subject has been one of the first Indian Companies to venture into the export market and in spite of many obstacles and misconceptions about Indian progress as IT Hardware compared to Indian Software, Subject has established itself worldwide as a player of the long run.

FUTURE PROSPECTS

A. GENERAL

As has been informed to the shareholders in earlier years the Company keeping in mind its overall competitiveness in international markets has closed the unit at No. 86A and B, 4th Cross, Electronics City, Hosur Road, Bangalore – 560 100. This unit used to manufacture CRT Terminals (GVX) for which there is no demand over many years. The workforce had become surplus. Workmen raised certain objections on the closure of this unit which have been rejected by the Secretary, Department of Labour, Government of Karnataka.

B. EXPORT

With the introduction of new products carrying better features and with the strengthening and addition of better and more features in their complementing software products, the company expects a substantial jump in exports in the next financial year.

As per Global Industry Analysts Inc’s recent global report on Thin Clients market, the world market for Thin Clients is projected to reach 14.36 million units in sales by the year 2015. Growth will be primarily driven by the ability of thin clients to present exceptional environmental and cost benefits to the user. Desktop virtualization and growing need for anytime, anywhere accessibility to corporate and Internet networks are the other trends that augur well for thin clients market.

Growth in the worldwide thin clients market is also fashioned by a range of environmental benefits that thin clients offer, including efficient use of energy and less use of raw materials. Thin clients are also the growing phenomena across the corporate world, as companies increasingly opt for providing their employees, just the basic systems required for processing their assigned tasks. The much awaited revolution in enterprise computing is now close at

hand, thanks to the proliferation of cutting edge technologies, such as, virtualization, which is helping push thin clients into the mainstream enterprise business.

VXL Instruments UK (subsidiary of VXL Instruments Limited, India) had announced in 2010 an agreement with Lenovo who develop, manufacture and market high quality, secure and easy to use technology products and services world-wide.( Lenovo group had earlier acquired the IBM Personal Computing Division.)

Under the agreement;-

– Subject thin clients will be made available through standard Lenovo Channels.

– Subject will also be selling Lenovo’s ThinkPad PCs.

Through this agreement Subject expects to increase its global and national reach through Lenovo’s widely spread sales channels.

SUBSIDIARY COMPANIES

VXL, UK has managed to earn a profit of USD 30,376 during the year.

The wholly owned Indian subsidiary, XL Net Software Systems Limited has been wound up with effect from 8th October 2010. It did not engage in any active business operations in the past few years.

Fixed Assets:

• Own Assets Land
• Building
• Plant and Machinery
• Plastic Mould
• Electrical Installation
• Office Equipment
• Air Conditioner
• Furniture and Fittings
• Vehicles

UNAUDITED FINANCIAL RESULTS FOR THE QUARTER AND NINE MONTHS ENDED 31^ST DECEMBER, 2011

Rs. in Millions

Particular	Three Months Ended	Three Months Ended	Figures for current period ended
	31.12.2011	30.09.2011	31.12.2011
	Unaudited	Unaudited	Unaudited
(a) Net Sales / Income from operations	157.900	214.600	626.700
(b) Other Operating Income	--	--	--
Total Income	157.900	214.600	626.700
Expenditure
a) (Increase) / Decrease in stock in trade and work in progress	2.400	20.000	33.700
b) Consumption of raw materials	121.000	158.000	471.400
c) Employees cost	10.000	9.000	28.100
d) Depreciation	3.000	3.000	9.000
e) Other expenditure	13.400	17.900	52.200
Total	149.800	207.900	594.400
Profit from operations before other income, interest and exceptional Items	8.100	6.700	32.300
Other income	0.100	4.900	9.900
Profit before interest and exceptional Items	8.200	11.600	42.200
Interest	7.100	5.900	20.100
Profit after Interest but before Exceptional Items	1.100	5.700	22.100
Exceptional Items income	--	--	--
Profit (+)/Loss(-) from Ordinary Activities before tax	1.100	5.700	22.100
Deferred tax credit / reversal	--	--	--
Net Profit (+)/Loss(-) from Ordinary Activities after tax	1.100	5.700	22.100
Extra ordinary items (net of tax expenses)	--	--	--
Net Profit (+) / Loss (-) for the year period	1.100	5.700	22.100
Paid up equity share capital (Face value of Rs.10/- per share)	133.400	133.400	133.400
Reserves excluding revaluation reserves as per balance sheet of previous accounting year	--	--	--
Accumulated Loss	--	--	--
Earning per share (EPS)
(a) Basic and diluted EPS before Extraordinary items for the period, for the year to date and for the previous year (not to be annualised)	0.08	0.43	1.66
Segment Reporting
Segment Revenue
Domestic Segment	40.200	38.400	100.800
Export Segment	117.700	176.200	525.900
Net revenue form operations	157.900	214.600	626.700
Segment Results
Profit / Loss before tax and interest
Domestic market	7.00	5.200	15.800
Export market	21.400	22.000	75.200
Total	28.400	27.200	91.000
Less: Interest	7.100	5.900	20.100
Less: Other Unallocable expenditure / income	20.200	15.600	48.800
Total Profit / Loss before tax	1.100	5.700	22.100
Add: Deferred tax credit / reversal	--	--	--
Net profit after tax	1.100	5.700	22.100
Public shareholding
Number of shares	11928980	11928980	11928980
Percentage of shareholding	89.36	89.36	89.36
Promoters and Promoters group Shareholding-
a) Pledged /Encumbered
Number of shares	--	--	--
Percentage of shares (as a % of total shareholding of the promoter and promoter group)	--	--	--
Percentage of shares (as a % of total share capital of the company)	--	--	--
b) Non Encumbered
Number of shares	1421020	1421020	1421020
Percentage of shares (as a % of total shareholding of the promoter and promoter group)	100	100	100
Percentage of shares (as a % of total share capital of the company)	10.64	10.64	10.64

Notes

1. The above results, reviewed by the Audit Committee, were approved by the Board at its meeting held on 08.02.2012 and the Auditors have carried out a limited review of the above results.

2. Segmentwise reporting is based on geographical regions. Since fixed assets are used in the Company’s business interchangeably, segment wise disclosure on capital employed has not been furnished.

3. The auditors have qualified their report with regard to non-provision in respect of the Company’s investments in and receivables from the subsidiary and accounting of deferred tax credits. In view of the long term prospects and steps taken to recover these receivables the management feels that no provision need be made in Accounts. Against the old receivables, Rs. 6.900 Millions has been received during the first and second quarter.

4. Investor’s complaints pending as on September 30, 2011 was Nil. The company has not received any investor’s complaint during the quarter ended December 31, 2011, leaving Nil Balance of complaint unresolved.

WEB SITE DETAILS

PROFILE

Established in 1976, Subject is a global leader in thin client and server-based computing technologies and has been manufacturing world-class thin client devices for over three decades providing a high quality range of high-specification, value for money models that are made to the most exacting standards.

This single-minded focus on thin clients and commitment to product quality is at the core of what Subject represents today together with a passion to support companies around the world to successfully build efficient IT infrastructures that are flexible, secure, manageable and affordable.

A Citrix OEM partner since 1996 and lately a Microsoft OEM and VMware Technology Alliance partners, Subject world-renowned ‘Itona’ brand of thin clients continues to go from strength to strength, with Subject on course to achieve its strategic goal of 25% market share of the global thin client market by the end of 2011.

Available in a variety of operating systems (Gio Linux, Sylph-OS, Windows CE, XP-Embedded, Windows Embedded Standard (WES 2009) and WES 7-E, VXL’s comprehensive product portfolio, includes Entry-Level, Mid-Range and High- Performance Desktops, Xtona Zero Clients,  touch screen Integrated models and the very latest, co-branded, Lenovo notebooks. Furthermore, Subject own innovative ‘XLmanage’ device management software also provides administrators with the ability to effectively manage devices remotely across a network.

Subject corporate head quarters and main manufacturing is based in Bangalore, India’s ‘Silicon Valley’, while the Americas Group HQ is located in Houston, Texas and the European HQ and Logistics centre in Manchester, UK. Dedicated Sales and Technical Support offices are also based in key strategic markets including Germany, France and Singapore, together with distribution partners in many other countries - for further contact information see Locations.

Subject mission statement, as a global leader in thin client and server-based computing technology, is to ensure its customers receive a higher return on their investment combined with a lower total cost of ownership.

NEWS

VXL COMMITS TO THE NEW CITRIX HDX™ READY SYSTEM-ON-CHIP (SOC) INITIATIVE

14/11/2011 – Following the recent announcement at Citrix Synergy™ 2011 Barcelona regarding the new Citrix HDX™ System-on-Chip (SoC) initiative, global thin client provider, VXL Instruments, extends its support and commitment to this innovative and exciting new breakthrough.

Designed to enable an entirely new generation of high definition thin client devices, the Citrix HDX™ Ready SoC technology will totally transform the end user experience of cloud based virtual desktops, providing excellent value for money without sacrificing performance. Being one of the first organizations to take part in the Citrix Ready® program since its inception, VXL today remains at the forefront of thin client desktop virtualisation developments.

Frank Noon, Vice President of Worldwide Sales at VXL commented; “VXL is both delighted and enthusiastic about this new initiative from Citrix and we and our customers fully appreciate the real benefits from this association and the new standards this sets for all involved”.

“The new Citrix HDX™ ready System-on-Chip will dramatically change the landscape of cloud based virtual thin and zero client desktops delivering a powerful solution combined with low power consumption plus excellent cost benefits” Noon added.

VXL will announce the availability of its new range of next generation, high definition (HDX) desktop devices at a later date.

ENDS

About VXL

VXL is one of the world’s largest suppliers of thin client hardware and offers the widest range of thin client devices including desktops, all-in-one devices, zero clients and co-branded, Lenovo, notebooks. A Citrix OEM partner since 1996, VXL employs over 300 employees globally. The worldwide company HQ is based in Bangalore, India, with its European HQ located in Manchester, UK, Americas Group US HQ in Houston, Texas and further worldwide operations in India, Singapore, Germany and France.

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. 48.94
UK Pound	1	Rs. 77.95
Euro	1	Rs. 65.93

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	4
OPERATING SCALE	1~10	4
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	3
--PROFITABILIRY	1~10	2
--LIQUIDITY	1~10	3
--LEVERAGE	1~10	2
--RESERVES	1~10	3
--CREDIT LINES	1~10	2
--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	NO
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		28

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	-

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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.