MIRA INFORM REPORT

Report Date :

14.03.2012

IDENTIFICATION DETAILS

Name :	ICICI SECURITIES PRIMARY DEALERSHIP LIMITED (w.e.f. 01.03.2007)
Formerly Known As :	ICICI SECURITIES AND FINANCE COMPANY LIMITED
Registered Office :	ICICI Centre, H. T. Parekh Marg, Churchgate, Mumbai – 400020, Maharashtra
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	22.02.1993
Com. Reg. No.:	11-131900
Capital Investment / Paid-up Capital :	Rs.1563.400 Millions
CIN No.: [Company Identification No.]	U72900MH1993PLC131900
TAN No.: [Tax Deduction & Collection Account No.]	MUMI01994G
PAN No.: [Permanent Account No.]	AAACI0995H
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Securities Investment and Trading Underwriting Portfolio Management Services
No. of Employees :	70 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

A (59)

RATING		STATUS	PROPOSED CREDIT LINE
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

Maximum Credit Limit :	USD 23400000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established and reputed company having fine track. General financial position is good. Director are reported as experienced and respectable businessman. 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 (GENERAL DETAILS)

Name :	Mr. Bhavya
Designation :	Account Department
Contact No.:	91-22-22882460
Date :	12.03.2012

LOCATIONS

Registered Office :	ICICI Centre, H. T. Parekh Marg, Churchgate, Mumbai – 400020, Maharashtra, India
Tel. No.:	91-22-22882460/70/ 22777600
Fax No.:	91-22-22845572
E-Mail :	prachiti_lalingkar@isecpd.com thomas_dsoza@isecltd.com vanessa_rajan@isecltd.com
Website :	www.icicisecuritiespd.com www.isecpd.com
Chennai Office :	ICICI Bank Towers, 2nd Floor, East Wing, Plot No. 24, South Phase I, Ambattur Industrial Estate, Chennai – 600058, Tamilnadu, India
Tel. No.:	91-44-3051 6612/6281/6613/6275, 3051 6614/6223
Fax No.:	91-44-3051 6280
New Delhi Office :	ICICI Bank Towers, 3rd floor, NBCC Place, North Tower, Pragati Vihar, Bisham Pitamah Marg, Lodi Road, New Delhi - 110 003, Delhi, India
Tel. No.:	91-11-24390000
Factory 1 :	2B, Gorky Terrace, Kolkatta, West Bengal - 700 017, India
Tel. No.:	91-33-22832209

DIRECTORS

As on 24.06.2011

Name :	Mr. Kannan Narayanan Srinivasa
Designation :	Director
Address :	Flat No.204, Kalpataru Horizon, S. K. Ahire Marg, Worli, Mumbai – 400018, Maharashtra, India
Date of Birth/Age :	30.06.1965
Date of Appointment :	01.05.2009
DIN No.:	00066009
Name :	Mr. Prasanna Balachander
Designation :	Managing director
Address :	1105, Tower B, Ashok Towers, Dr. S. S. Rao Road, Parel, Mumbai – 400012, Maharashtra, India
Date of Birth/Age :	06.06.1970
Date of Appointment :	28.06.2008
DIN No.:	02257744
Name :	Mr. Subir Sudhirchandra Saha
Designation :	Director
Address :	Flat No.C-401, Anmol Opp. Patel Auto, S.V. Road, Goregaon, Mumbai – 400062, Maharashtra, India
Date of Birth/Age :	15.11.1970
Date of Appointment :	17.07.2007
DIN No.:	00227049
Name :	Mr. Uday Madhav Chitale
Designation :	Director
Address :	167-C, Poonawadi Dr. Ambedkar Road, Dadar (East), Mumbai – 400014, Maharashtra, India
Date of Birth/Age :	20.10.1949
Date of Appointment :	11.10.2005
DIN No.:	00043268
Name :	Ms. Vishakha Vivek Mulye
Designation :	Director
Address :	A-303, Atria Akruti Niharika Complex, Prof. N S Phadke Marg, Andheri, Mumbai – 400069, Maharashtra, India
Date of Birth/Age :	04.02.1969
Date of Appointment :	07.09.2007
DIN No.:	00203578
Name :	Ms. Shilpa Naval Kumar
Designation :	Director
Address :	The Cliff Co-operative Housing Society, 2^nd Floor, 27 Pochkanwalla Road, Worli, Mumbai – 400025, Maharashtra, India
Date of Birth/Age :	12.09.1966
Date of Appointment :	23.06.2011
DIN No.:	02404667
Name :	Mr. Sundaram Gopalaiyer
Designation :	Director
Address :	Plot No.202, Royal Crest, Plot No.31, Shridhar Palace – A C H S Lokmanya Tilak Vasahat Road, Road No.3, Dadar (East), Mumbai – 400013, Maharashtra, India
Date of Birth/Age :	12.05.1965
Date of Appointment :	15.01.2009
DIN No.:	02516202

KEY EXECUTIVES

Name :	Mr. Prachiti Deepak Lalingkar
Designation :	Secretary
Address :	901, B Wing, Prathamesh Towers, MMGS Marg, Dadar (East), Mumbai – 400014, Maharashtra, India
Date of Birth/Age :	28.09.1984
Date of Appointment :	01.07.2010
PAN No.:	ACRPL2338M
Name :	Mr. Bhavya
Designation :	Account Department

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 24.06.2011

Names of Shareholders	No. of Shares
Sandeep Surajprakash Bakhshi	1
Subir Sudhirchandra Saha	1
Harikrishnan V.	1
ICICI Bank Limited, India	1
Prasanna Balachander	1
Sundaram Gopalaiyer	1
ICICI Securities Limited, India	1
ICICI Bank Limited, India	15627
Total	15634

Equity Share Break up (Percentage of Total Equity)

As on 24.06.2011

Category	Percentage
Nationalised or other banks	100.00
Total	100.00

BUSINESS DETAILS

Line of Business :	· Securities Investment and Trading · Underwriting · Portfolio Management Services
Terms :
Selling :	Depends
Purchasing :	Depends

GENERAL INFORMATION

No. of Employees :

70 (Approximately)

Bankers :

ICICI Bank, Mumbai, Maharashtra, India

Facilities :

Secured Loan	As on 31.03.2011 (Rs. in Millions)	As on 31.03.2010 (Rs. in Millions)
Borrowings under Liquidity Adjustment Facility (Secured by pledge of Government securities of Face Value Rs.3130.000 millions) (Previous year Rs. Nil)	2950.000	0.000
Collateralised Borrowings (Secured by pledge of Government securities of Face Value Rs.2407.400 millions) (Previous year Rs.5417.400 Millions)	1980.300	2073.650
Repo Borrowings (Secured by pledge of Government securities of Face Value Rs.22010.500 millions) (Previous year Rs. Nil)	21895.850	0.000
Total	26826.150	2073.650
Unsecured Loan	As on 31.03.2011 (Rs. in Millions)	As on 31.03.2010 (Rs. in Millions)
Subordinated Bonds issued as Tier II Capital (Due within one year Rs.2100.00 millions [Previous year Rs.100.00 millions])	2950.000	2200.000
Subordinated Bonds issued as Tier II Capital (Due within one year Rs. Nil [Previous year Rs. Nil])	500.000	500.000
Inter-Corporate Borrowings (Due within one year Rs.4050.000 millions [Previous year Rs.2500.00 million])	4050.000	2500.000
Money at Call, Short Notice and Term -From Banks	10550.000	5640.000
Commercial Paper Borrowings (Short Term)
-From Banks	998.180	597.940
-From Others	3331.310	11330.100
Total	22379.490	22768.040

Banking Relations :	--
Auditors :
Name :	S. R. Batliboi and Company Chartered Accountants
Address :	6^th Floor, Express Towers, Nariman Point, Mumbai – 400021, Maharashtra, India
PAN.:	AALFS0506L
Holding Company :	ICICI Bank Limited
Fellow Subsidiaries :	· ICICI Securities Limited · ICICI Lombard General · Insurance Company Limited · ICICI Prudential Life Insurance · Company Limited · ICICI Home Finance Limited · ICICI Venture Fund Management · Company Limited
Associates:	ICICI Foundation for Inclusive Growth

CAPITAL STRUCTURE

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
50000	Equity Shares	Rs.100000/- each	Rs.5000.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
15634	Equity Shares	Rs.100000/- each	Rs.1563.400 Millions

Notes:

Of the above, 15634 Equity Shares of Rs.100000/- each fully paid are held by ICICI Bank Limited (the Holding company) and its nominees.

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		1563.400	1563.400	1563.400
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		4284.590	4057.140	3701.230
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		5847.990	5620.540	5264.630
LOAN FUNDS
1] Secured Loans		26826.150	2073.650	5338.530
2] Unsecured Loans		22379.490	22768.040	17387.360
TOTAL BORROWING		49205.640	24841.690	22725.890
DEFERRED TAX LIABILITIES			0.000	0.000
TOTAL		55053.630	30462.230	27990.520
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		36.120	23.230	31.770
Capital work-in-progress		1.080	13.530	0.000
INVESTMENT		0.000	0.000	0.000
DEFERREX TAX ASSETS		24.220	23.060	31.770
CURRENT ASSETS, LOANS & ADVANCES
	Interest Accrued	192.830	176.700	234.350
	Securities held as stock in trade	51921.110	23312.850	24587.660
	Sundry Debtors	4165.660	10727.900	8249.860
	Cash & Bank Balances	2108.270	506.970	305.880
	Loans and Advances	2541.890	4354.860	1621.580
Total Current Assets		60929.760	39079.280	34999.330
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	39.870	35.700	63.710
	Other Current Liabilities	5756.200	8518.780	6876.630
	Provisions	141.480	122.390	131.130
Total Current Liabilities		5937.550	8676.870	7071.470
Net Current Assets		54992.210	30402.410	27927.860
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		55053.630	30462.230	27990.520

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Income from Services	185.970	212.620	283.250
		Interest income	3011.110	2448.070	3089.500
		Profit /(Loss) on Securities	356.170	242.390	3880.260
		Other Income	36.100	308.960	36.940
		TOTAL (A)	3589.350	3212.040	7289.950
Less	EXPENSES
		Financial Charges and Operating Expenses	2340.620	1428.240	2393.470
		Payments to and Provisions for Employees	324.220	484.510	534.620
		Establishment and Other Expenses	111.720	131.130	172.080
		TOTAL (B)	2776.560	2043.880	3100.170
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		812.790	1168.160	4189.780
Less	FINANCIAL EXPENSES (D)		0.000	0.000	0.000
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		812.790	1168.160	4189.780
Less/ Add	DEPRECIATION/ AMORTISATION (F)		9.130	9.560	13.090
	PROFIT BEFORE TAX (E-F) (G)		803.660	1158.600	4176.690
Less	TAX (H)		275.850	308.830	1455.450
	PROFIT AFTER TAX (G-H) (I)		527.810	849.770	2721.240
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		553.780	452.800	444.720
Less	APPROPRIATIONS
		Transfer to Special Reserve	105.560	169.950	544.250
		Transfer to General Reserve	52.780	84.980	272.120
		Transfer to Capital Reserve	9.860	0.000	0.000
		Proposed Dividend	62.540	54.720	54.720
		Utilised towards Buyback of Shares	0.000	0.000	311.250
		Interim Dividend	195.430	367.400	1300.500
		Corporate Dividend Tax	42.390	71.740	230.320
	BALANCE CARRIED TO THE B/S		613.030	553.780	452.800
	Earnings Per Share (Rs.)		33760.39	54353.97	170899.96

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	14.70	26.45	37.33
Net Profit Margin (PBT/Sales)	(%)	22.39	36.07	57.29
Return on Total Assets (PBT/Total Assets}	(%)	1.32	2.96	11.92
Return on Investment (ROI) (PBT/Networth)		0.14	0.21	0.79
Debt Equity Ratio (Total Liability/Networth)		9.43	5.96	5.66
Current Ratio (Current Asset/Current Liability)		10.26	4.50	4.95

LOCAL AGENCY FURTHER INFORMATION

Sundry Creditors Details:

(Rs. in Millions)

Particulars	31.03.2011	31.03.2010	31.03.2009
Sundry Creditors for Expenses	39.870	35.700	63.710
Total	39.870	35.700	63.710

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	Yes
5) Type of Business	Yes
6) Line of Business	Yes
7) Promoter’s background	--
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	No
12) Profitability for last three years	No
13) Reasons for variation <> 20%	--
14) Estimation for coming financial year	No
15) Capital in the business	No
16) Details of sister concerns	Yes
17) Major suppliers	No
18) Major customers	No
19) Payments terms	Yes
20) Export / Import details (if applicable)	No
21) Market information	--
22) Litigations that the firm / promoter	--
23) Banking Details	Yes
24) Banking facility details	--
25) Conduct of the banking account	--
26) Buyer visit details	--
27) Financials, if provided	No
28) Incorporation details, if applicable	--
29) Last accounts filed at ROC	--
30) Major Shareholders, if available	--

INDUSTRY OVERVIEW

India’s economy gained momentum in fiscal 2011 as buoyant consumption and external demand lifted economic activity across sectors. As per the Central Statistical Organisation’s advance estimates, the domestic economy grew at 8.6% in fiscal 2011 compared to 8% growth recorded in fiscal 2010. Output growth accelerated due to revival in agriculture and external sectors. While agriculture production benefited from above normal rains brought by south-west monsoon, a recovery, albeit partial and slow, in the global economy provided fillip to external trade. Industrial and services sectors clocked robust growth of 8.2% and 9.4% respectively which was accompanied by persistently high rate of inflation throughout the year. Encouraged by the swift pace of economic recovery and in order to curb build up of inflationary pressure, the central bank raised policy rates in calibrated steps of 25 basis points. Cumulatively, during fiscal 2011, Reserve Bank of India (RBI) hiked Repo and Reverse Repo rates by 175 basis points and 225 basis points respectively thereby narrowing the Liquidity Adjustment Facility corridor to 100 basis points. RBI also hiked the cash reserve ratio by 25 basis points at the beginning of fiscal. Another key macro economic development in fiscal 2011 was the improvement in government finances. The central government’s fiscal deficit declined to 5.1% of gross domestic product (GDP) (as against 5.5% budgeted) after government collected windfall revenue from telecom spectrum auctions. The payout on account of spectrum auction and the sharp rise in government cash surplus in June 2010 led to banking system liquidity falling into deficit mode for rest of the year.

During fiscal 2011, inflation was the single biggest concern as high food prices and rising fuel costs became increasingly generalised and spilled over to core inflation towards the end of financial year. As recovery firmed up in advanced economies, commodity prices rose sharply with the Reuters CRB index rising over 30% during fiscal 2011. The monthly inflation at the end of fiscal 2011 stood at 8.32%. Further, the inflation reading for the month of March 2011, which was announced in April 2011 went up to 8.98%. Notwithstanding an elevated level of inflation, domestic real consumption demand registered a healthy growth of 8.2%. Investment demand continued to benefit from inventory accumulation by firms even as investment in equipment and structures lagged expectations of a sharp rise. Manufacturing activity, as reflected by the Purchasing Manager Index survey, remained robust during entire fiscal 2011 to meet rising domestic and external demand. During the year, industrial production data turned unpredictable leaving policymakers to rely on other indicators to assess the state of industrial demand. Among other key indicators, non-food credit growth accelerated to 23% from 16.9%. The strength in credit off-take is noteworthy because the banking system was faced with slowdown in deposit mobilisation and tight liquidity for most of fiscal 2011. On external front, first half of fiscal 2011 began on a worrisome note with current account deficit reaching an all time high of 4.3% during Q2-2011. However, due to significant pick up in exports during Q3 2011, the current account deficit for first three quarters of the fiscal printed at a more comfortable 3.2% of GDP. Capital flows were broadly in line with the current account in first three quarters of the fiscal but the contribution of non volatile flows went down substantially.

Globally, the central banks in G3 economies maintained accommodative monetary stance for the entire year even while recovery strengthened and commodity prices moved up.

In government bond market, turbulence in global markets due to the European sovereign debt crisis saw a brief rally in mid Q1-2011 which proved to be unsustainable due to the backdrop of high inflation, rising policy rates and tight liquidity. These factors also led to gradual uptrend in bond yields during fiscal 2011. The yield on benchmark 10 year reached a peak of 8.27% in February 2011 before declining to 8.08% in end March 2011 as primary supply dried up. The demand supply dynamic turned favourable in the second half of fiscal 2011 as government issued Rs.200000.000 millions less bonds than budgeted and also due to RBI’s purchase of Rs.670000.000 millions of government securities through open market operations. The reduced supply and RBI’s timely intervention through purchase of bonds prevented bond yields from spiking. On other points of yield curve, most notable move was seen in short end rates with 1 year treasury bill rising by over 200 basis points through fiscal 2011 leading to a substantial flattening of the yield curve.

Overall, the year was characterised with rising rates, constrained liquidity and increasing inflation expectations, with RBI seeking to manage a large borrowing programme through timely and need based balance sheet support. The limitation of movements in yields constrained the performance of the Company’s proprietary book while rising funding rates and tight liquidity resulted in a reduction of net interest income.

FINANCIAL HIGHLIGHTS

Profit after tax for the year ended March 31, 2011 was Rs.527.800 millions (previous year: Rs.849.800 millions). After taking into account the balance of Rs.553.800 millions (previous year: Rs.452.800 millions) brought forward from the previous year, the profit available for appropriation is Rs.1081.600 millions (previous year: Rs.1302.600 millions), of which Rs.52.800 millions (previous year: Rs.85.000 millions) and Rs.105.600 millions (previous year: Rs.169.900 millions) have been transferred to General Reserve and Special Reserve respectively.

OPERATIONAL REVIEW

Fixed Income

During the past year, the Company strived to maintain its leadership in the fixed income market despite a difficult interest rate environment. Inflation remained at high levels and liquidity conditions turned unfavourable and tight. The supply of government securities in primary markets was large and regular, resulting in few trading opportunities. Globally, commodity prices soared on back of accommodative policies in developed market. The consequent rise in inflation expectations led to central banks in emerging economies tightening monetary policy. The Company traded cautiously in uncertain and choppy conditions in the government securities market. The primary dealership book was successful in using the intermittent short rallies to generate trading gains and used derivatives appropriately to profit from upward movement in rates. The Company successfully met its underwriting and bidding commitments in the primary market and traded actively in the secondary market to achieve an overall turnover in excess of Rs.2921.800 billion.

In the corporate bond market, fiscal 2011 saw short term rates surging on back of hikes by RBI and persistent liquidity deficit to an extent that the yield curve inverted towards the later part of the year. The 1 year certificate of deposits level increased from 6.50% to above 10%, a sharp increase of over 350 basis points through the year. The yield on 10 year AA bonds increased from 8.84% to 9.15%. The trading environment was difficult given the secular increase in rates across the curve and persistent strain on funding. During the year, single borrower limits and group borrower limits were instituted in respect of stand alone primary dealers which resulted in reduced turnover and margins for the Company.

On the positive side, RBI allowed repo transactions with corporate bonds as underlying during fiscal 2011. The Company maintained its commitment to the development of the bond market and executed the first deal in corporate bond repo. RBI also released the draft guidelines for Credit Default Swaps, a derivative which would facilitate trading on credit spreads. They expect the product to be launched in early fiscal 2012.

In the Interest Rate Swaps market, improving liquidity from fiscal 2010 continued into fiscal 2011. Market volumes improved considerably and the Company’s volumes in Overnight Indexed Swaps almost doubled compared to the previous fiscal. Swaps were actively used to hedge bond positions and trading positions in an environment of hardening interest rates and tight liquidity. Efficient utilisation of capital remained a key focus.

The Company saw yet another year of excellent growth in volumes in the corporate bond primary placement market. The total deal volumes touched Rs.620.000 billion, enabling the Company to be the only non-bank entity in the top three in PRIME league tables.

The Company’s significant deals as sole arranger included placement of Rs.10.00 billion of 15 year HDFC bond (which is the longest maturity bond issued by a housing finance company), Rs.13.65 billion of Tata Son Limited’s long term unsecured unlisted bonds and Rs.10.00 billion issuance by National Bank for Agriculture and Rural Development. The Company also diversified into other issuer segments including state level undertakings with the largest state guaranteed bond issue for the year by Andhra Pradesh Power Finance Corporation Limited for Rs.10.00 billion.

Portfolio Management Services

The Company has been managing the funds belonging to the Coal Mines Provident Fund Organisation (CMPFO), under the Ministry of Coal on a discretionary basis since December 2006. During fiscal 2011, the fund management agreement with CMPFO was extended for a period of six months.

The Company was appointed as advisors to the Rajasthan Rajya Vidyut Karamchari Superannuation and Gratuity Fund Trusts.

The Company was also re-appointed as Advisors to Hindustan Instruments Limited and CESC Limited for their provident fund and to the West Bengal State Electricity Distribution Company Limited for its pension and gratuity funds.

Overall, gross Assets under Management on a discretionary basis were at Rs.458.00 billion at March 31, 2011. The Company is proactively targeting new clients to increase its presence in this line of business.

OUTLOOK

In the year ahead, coping with extremely high inflationary pressures, the source of which has recently shifted from food to manufacturing, in the face of elevated levels of crude and other commodity prices will be the key challenge for policy makers and the Indian economy. Growth is expected to moderate from fiscal 2011 on account of higher interest rates and fiscal consolidation. The high level of crude prices may pose challenges on multiple fronts – inflation, government finances and external accounts. In consequence, headline wholesale price index inflation may continue to rule at elevated levels in the first half of fiscal 2012 before moderating due to lagged effects of monetary policy and a likely fall in crude prices. The stickiness of headline inflation is likely to result in further increase in policy rates. On the external front, capital flows are expected to pick up during the year leading to a surplus situation on the Balance of Payments despite a widening of the current account deficit. Liquidity conditions are expected to remain in deficit on an average during the year. However, liquidity conditions are seen as being more predictable and remaining within RBI’s comfort zone in contrast to last year. The bond market is set to face another challenging year in the backdrop of high inflation, deficit liquidity conditions and further rate hikes. While the demand supply dynamic in bond market is likely to be favourable in the first half of fiscal 2012, the situation may turn adverse in the second half should there be a slippage in fiscal deficit estimates. Globally, the Fed is expected to maintain status quo after completing its ongoing bond purchase programme while the ECB may hike rates further in calendar year 2011.

Contingent liabilities (As on 31.03.2011):

(a) Income tax and service tax matters disputed by the Company Rs.171.320 millions

(b) Estimated amount of contracts to be executed on capital account as at March 31, 2011 are Rs.1.120 millions

FIXED ASSETS

· Plant and Machinery/ Electrical Installation

· Office Equipment

· Computers

· Furniture and Fixtures

· Vehicles

· Software

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.49.85
UK Pound	1	Rs.77.97
Euro	1	Rs.65.62

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	7
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	7
--LEVERAGE	1~10	7
--RESERVES	1~10	7
--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	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		59

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.