MIRA INFORM REPORT

Report Date :

24.11.2012

IDENTIFICATION DETAILS

Name :	ANDHRA FERRO ALLOYS LIMITED
Registered Office :	7-5-5-33(17), Flat No. 501, Swagruha Coral, R K Beach, Visakhapatnam – 530003, Andhra Pradesh
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	20.03.1986
Com. Reg. No.:	01-006292
Capital Investment/ Paid-up Capital:	Rs.30.585 Millions
CIN No.: [Company Identification No.]	U27101AP1986PLC006292
TAN No.: [Tax Deduction & Collection Account No.]	VPNA00104G
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturer of high Carbon Ferro Chrome, Manganese etc.
No. of Employees:	500 [Approximately]

RATING & COMMENTS

MIRA’s Rating :

Ba (46)

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

Maximum Credit Limit :	USD 1149000
Status :	Satisfactory
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is an established company having satisfactory track. Trade relations are reported as fair. Business is active. Payments are reported to be usually correct 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.

ECGC Country Risk Classification List – June 30, 2012

Country Name	Previous Rating (31.03.2012)	Current Rating (30.06.2012)
India	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

INDIAN ECONOMIC OVERVIEW

India is developing into an open-market economy, yet traces of its past autarkic policies remain. Economic liberalization, including industrial deregulation, privatization of state-owned enterprises, and reduced controls on foreign trade and investment, began in the early 1990s and has served to accelerate the country's growth, which has averaged more than 7% per year since 1997. India's diverse economy encompasses traditional village farming, modern agriculture, handicrafts, a wide range of modern industries, and a multitude of services. Slightly more than half of the work force is in agriculture, but services are the major source of economic growth, accounting for more than half of India's output, with only one-third of its labor force. India has capitalized on its large educated English-speaking population to become a major exporter of information technology services and software workers. In 2010, the Indian economy rebounded robustly from the global financial crisis - in large part because of strong domestic demand - and growth exceeded 8% year-on-year in real terms. However, India's economic growth in 2011 slowed because of persistently high inflation and interest rates and little progress on economic reforms. High international crude prices have exacerbated the government's fuel subsidy expenditures contributing to a higher fiscal deficit, and a worsening current account deficit. Little economic reform took place in 2011 largely due to corruption scandals that have slowed legislative work. India's medium-term growth outlook is positive due to a young population and corresponding low dependency ratio, healthy savings and investment rates, and increasing integration into the global economy. India has many long-term challenges that it has not yet fully addressed, including widespread poverty, inadequate physical and social infrastructure, limited non-agricultural employment opportunities, scarce access to quality basic and higher education, and accommodating rural-to-urban migration.

Source : CIA

EXTERNAL AGENCY RATING

Rating Agency Name	CRISIL
Rating	BB+ (Long Term Rating)
Rating Explanation	Having moderate risk of default regarding timely servicing of financial obligation.
Date	October 2012

INFORMATION PARTED BY

Name :	Mr. Jagarao
Designation :	Deputy Manager
Contact No.:	91-8966-273311
Date :	27.06.2012

LOCATIONS

Registered Office :	7-5-5-33(17), Flat No. 501, Swagruha Coral, R K Beach, Visakhapatnam – 530003, Andhra Pradesh, India
Tel. No.:	91-8966-273311
Mobile No.:	91-9491058681(Mr.Jagaro)
Fax No.:	91-8966-273344
E-Mail :	andhraferro@rediffmail.com
Location :	Owned
Unit 1 :	Garbham, Merakamudidam Mandal, Vizianagaram District - Andhra Pradesh
Tel. No.:	91-8952-288344,288408
Unit 2 :	Srinivasanagar, Chinthalapalem (PO), Pendurthi (SO), Via Visakhapatnam, Vizianagaram District - Andhra Pradesh - 530 017
Tel. No.:	91-8966-273311,273289
Fax No.:	91-8966-273344
Head Office :	303, B.D.Chambers, 10/54, Desh Bandhu Gupta Road, Karol Bagh, New Delhi-110 005
Tel. No.:	91-011-23527544 / 23527545 / 27538714
Fax No.:	91-011-23680431,23557606

DIRECTORS

As on 30.09.2011

Name :

Mr. Brajendra Khandelwal

Designation :

Managing Director

Address :

Flat No. 401, Swagruha Coral, R.K. Beach, Visakhapatnam – 530003, Andhra Pradesh

Date of Birth/Age :

05.10.1953

Qualification :

Under Graduate

Experience :

31 Years

Date of Appointment :

01.04.1997

DIN :

00201689

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	U25209UP1984PTC006780	SHASHI (H.D.)POLYPROPLENE BAGS PRIVATE LIMITED	Director	08/12/1993	08/12/1993	-	Dormant	NO
2	U27101AP1986PLC006292	ANDHRA FERRO ALLOYS LIMITED	Managing director	01/04/1997	01/04/1997	-	Active	NO
3	U27109DL1989PLC036561	ACCORD ALLOYS LIMITED	Director	28/10/2004	28/10/2004	-	Active	YES
4	U27101DL1997PLC085107	HIMANI ALLOYS LIMITED	Director	11/12/2004	11/12/2004	-	Active	YES

Name :

Mr. Garvit Khandelwal

Designation :

Director

Address :

Flat No. 401, Swagruha Coral, R.K. Beach, PR Puram, Visakhapatnam – 530003, Andhra Pradesh

Date of Birth/Age :

27.11.1987

Date of Appointment :

01.04.2006

DIN :

00808053

Name :

Mrs. Manjubala Khandelwal

Designation :

Wholetime Director

Address :

Flat No. 401, Swagruha Coral, R.K. Beach, Visakhapatnam – 530003, Andhra Pradesh

Date of Birth/Age :

29.10.1954

Experience :

26 Years

Date of Appointment :

22.12.1999

DIN :

00201730

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	U27101AP1986PLC006292	ANDHRA FERRO ALLOYS LIMITED	Whole-time director	22/12/1999	22/12/1999	-	Active	NO
2	U27101DL1997PLC085107	HIMANI ALLOYS LIMITED	Director	27/11/2002	27/11/2002	-	Active	YES
3	U27109DL1989PLC036561	ACCORD ALLOYS LIMITED	Director	02/06/2003	02/06/2003	-	Active	YES

KEY EXECUTIVES

Name :	Mr. Jagarao
Designation :	Deputy Manager

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 30.09.2011

SHARE HOLDING DETAILS FILE ATTACHED

AS ON 05.07.2011

Names of Shareholders	No. of Shares
Brajendra Khandelwal	973493
Manjubala Khandelwal	767845
Garvit Khandelwal	268000
Babu Khandelwal	308023
Sangeeta Khandelwal	98136
Total	2415497

As on 30.09.2011

Category	Percentage
Directors or relatives of directors	99.29
Other top fifty shareholders	0.71
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer of high Carbon Ferro Chrome, Manganese etc.

Products :

ITC Code	Products Description
72022100	High Carbon Ferro Chrome
72023000	Silico manganese

Terms :

Selling :

Cash/Credit

Purchasing :

Cash/Credit

PRODUCTION STATUS AS ON 31.03.2011

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
High Carbon Ferro Chrome		NA	30000	23729.650
High Carbon Ferro Manganese		NA	23000	NA

GENERAL INFORMATION

Suppliers :

Orissa minig Corporation Limited

Customers :

Rashtriya Ispat Nigam Limited

No. of Employees :

500 [Approximately]

Bankers :

· State Bank of India, Commercial Branch, 43-29-5/8, Narona Road, Dondaparthy, Vihakapatnam -530016, Andhra Pradesh, India

· State Bank of India, Overseas Branch, 9-1-57, GNT Road, Visakhapatnam 530013, Andhra Pradesh, India

· IDBI Bank Limited, IDBI Tower T C Complex, Cuffe Parade, Mumbai 400005, Maharashtra, India

· HDFC Bank Limited

· ICICI Bank Limited

Facilities :

Rs. In Millions

SECURED LOAN	31.03.2011	31.03.2010
Foreign currency loans banks secured	19.885	35.013
Working capital loans banks secured	46.135	148.463
Loans taken for vehicles secured	1.268	1.459
	67.288	184.935

Banking Relations :	--
Auditors :
Name :	Murthy Associates Chartered Accountants
Address :	Flat No. 102, Lakshmi Apartments, Facor Layout, Waltair Upland, Visakhapatnam – 530003, Andhra Pradesh, India
Pan No.:	AACFM0015F

CAPITAL STRUCTURE

As on 30.09.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
6000000	Equity Share	Rs.10/- each	Rs.60.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
5473987	Equity Share	Rs.10/- each	Rs.54.739 Millions

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
5000000	Equity Share	Rs.10/- each	Rs.50.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
3058490	Equity Share	Rs.10/- each	Rs.30.585 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		30.585	30.585	21.435
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		256.635	205.538	153.861
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		287.220	236.123	175.296
LOAN FUNDS
1] Secured Loans		67.288	184.935	133.245
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		67.288	184.935	133.245
DEFERRED TAX LIABILITIES		8.854	8.036	0.000
TOTAL		363.362	429.094	308.541
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		174.839	182.364	165.714
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		5.348	0.348	0.348
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	175.539	121.189	194.256
	Sundry Debtors	98.292	86.517	26.350
	Cash & Bank Balances	68.717	145.403	22.927
	Other Current Assets	0.000	0.000	0.763
	Loans & Advances	110.337	81.482	62.589
Total Current Assets		452.885	434.591	306.885
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditor	129.851	77.530	112.535
	Other Current Liabilities	114.450	80.874	36.485
	Provisions	25.409	29.805	15.386
Total Current Liabilities		269.710	188.209	164.406
Net Current Assets		183.175	246.382	142.479
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		363.362	429.094	308.541

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Income	1509.978	1179.994	1094.620
		Other Income	17.137	16.937	20.426
		TOTAL (A)	1527.115	1196.931	1115.046
Less	EXPENSES
		Consumption material changes inventories	971.695	699.895
		Manufacturing service cost	343.868	297.225
		Employee related expenses	11.148	8.105
		Administrative selling other Expenses	102.227	79.468
		TOTAL (B)	1428.938	1084.693	1058.434
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		98.177	112.238	56.512
Less	FINANCIAL EXPENSES (D)		6.298	15.507	13.508
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		91.879	96.731	43.104
Less/ Add	DEPRECIATION/ AMORTISATION (F)		14.554	13.498	12.753
	PROFIT BEFORE TAX (E-F) (G)		77.325	83.233	30.351
Less	TAX (H)		26.228	31.555	18.111
	PROFIT AFTER TAX (G-H) (I)		51.097	51.678	12.240
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		197.452	145.774	133.534
	BALANCE CARRIED TO THE B/S		248.549	197.452	145.774
	EARNINGS IN FOREIGN CURRENCY		836.865	822.351	932.498
	Earnings Per Share (Rs.)		16.71	16.89	14.16

Particulars	31.03.2012
Sales Turnover (Approximately)	1250.000

Expected Sales (2012-2013) : Rs. 1300.000 Millions

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	3.35	4.31	1.09
Net Profit Margin (PBT/Sales)	(%)	5.12	7.05	2.77
Return on Total Assets (PBT/Total Assets}	(%)	12.32	13.49	6.42
Return on Investment (ROI) (PBT/Networth)		0.27	0.35	0.17
Debt Equity Ratio (Total Liability/Networth)		1.17	1.58	1.70
Current Ratio (Current Asset/Current Liability)		1.68	2.30	1.87

LOCAL AGENCY FURTHER INFORMATION

Check List by Info Agents	Available in Report [Yes/No]
Year of Establishment	Yes
Locality of the Firm	Yes
Constitution of the firm	Yes
Premises details	No
Type of Business	Yes
Line of Business	Yes
Promoters background	Yes
No. of Employees	Yes
Name of Person Contacted	Yes
Designation of contact person	Yes
Turnover of firm for last three years	Yes
Profitability for last three years	Yes
Reasons for variation <> 20%	-
Estimation for coming financial year	Yes
Capital the business	Yes
Details of sister concerns	No
Major Suppliers	Yes
Major Customers	Yes
Payment Terms	Yes
Export / Import Details [If Applicable]	Yes
Market Information	-
Litigations that the firm / promoter involved in	-
Banking Details	Yes
Banking Facility Details	Yes
Conduct of the banking account	-
Buyer visit details	-
Financials, if provided	Yes
Incorporation details, if applicable	Yes
Last accounts filed at ROC	Yes
Major Shareholders, if applicable	Yes
Date of Birth of Proprietor/Partner/Director, if available	Yes
PAN of Proprietor/Partner/Director, if available	No
Voter ID No of Proprietor/Partner/Director, if available	No
External Agency Rating, if available	Yes

Company Operations:

There is remarkable progress and tremendous growth in the business activities and operations of the company. During the financial year 2010-11, the company has achieved production of 23729.650 MT of high carbon ferro chrome and silicon manganese and out of this exported 13026.000 MT to different countries. In terms of Rupee value, the export is of Rs.853.02 millions and this way the company has contributed foreign currency to the ex-chequer.

The company has achieved a turnover of Rs.1574.51 millions which comprises of both domestic and export turnover this as against Rs.1179.90 millions turnover achieved in the immediate preceding financial year.

The net profit achieved by the company is of Rs.773.24 millions as against Rs.832.32 millions(before tax and after depreciation), a sizable growth in the profit earning of the company.

In the ensuring years, taking overall economy growth and upward trends in all spheres, the directors are confident that there would be huge market for alloys steel, stainless and special steel which would inturn potentially increase the demand for ferro chrome and silicon manganese. Keeping these factors in mind and also the future market the directors are proposing for installing 11 MVA ORC with 132 KV dedicated line feeder at Kothavalasa, unit-1 and proposing for installing 11 MVA ORC furnace at Garbham, unit-2. These plans are subject to various clearances from different statutory authorities.

The company and its quality product is patternized in the international market and this is evident from the continuous orders it has been

receiving from different countries like South Korea, China, Thailand, Malaysia, Japan, Vietnam, South Africa, some European Countries and US. The directors are making every effort by keeping good relations with the customers in these countries.

The directors are inform that having been maintaining high standards of quality production, the company has been awarded ISO 9001-2008 certificate. Besides this, the company has also received export Excellency award for the year 2008-09 instituted by Engineering Export Promotion Council.

FORM 8

Corporate identity number of the company	U27101AP1986PLC006292
Name of the company	ANDHRA FERRO ALLOYS LIMITED
Address of the registered office or of the principal place of business in India of the company	7-5-5-33(17), Flat No. 501, Swagruha Coral, R K Beach, Visakhapatnam – 530003, Andhra Pradesh, India Email: andhraferro@rediffmail.com
This form is for	Modification of charge
Charge identification (ID) number of the charge to be modified	90127627
Type of charge	Book debts Movable property (not being pledge)
Particular of charge holder	State Bank of India, Commercial Branch, 43-29-5/8, Narona Road, Dondaparthy, Vihakapatnam -530016, Andhra Pradesh, India Email: rc.kolluru@sbi.co.in
Nature of instrument creating charge	1) Supplemental Agreement of Loan for increase in the Overall Limit (Form C.1-A) 2) Supplemental Agreement of Hypothecation of Goods and Assets for increase in the Overall Limit (Form C.2-A) 3) Letter regarding the grant of individual limits within the Overall Limit (Form C.5)
Date of instrument Creating the charge	25.04.2012
Amount secured by the charge	Rs.920.000 millions
Brief of the principal terms an conditions and extent and operation of the charge	Rate of interest CC (Hyp) : @ 6% above BR present effective rate being 16.50 p.a. Term Loan - II : @ 7% above BR present effective rate being 17% p.a. EPC : As applicable to SBI Exporters' Gold Card Terms of repayment Working Capital shall be repayable on demand Term Loan - II of Rs.170.000 Millions is repayable in 66 monthly Installments commencing from April, 2013 Margin Cash Credit : RM & FG : 25% EPC : 10% Receivables (Cover : 90 days) : 50% LC : 10% BG : 10% Term Loan : 39% Extent and operation of the charge It is a continuous charge until repayment of entire dues. For Cash Credit : Paripassu 1st Charge on Current Assets of the Company along with IDBI Bank. Extension of Charge on Fixed Assets of the Company exclusively for SBI. For Term Loan : 1st Charge on Fixed Assets of the Company including EM of Land and Structures and hypothecation of Plant and Machinery. 2nd Charge on Current Assets of the Company. Others: Nature of Facilities : Cash Credit Facility of Rs.200.000 Millions (with Sub-Limit of EPC Facility of Rs.200.000 Millions and DDP (Cheques) Facility of Rs.05.000 Millions), Stand by Line of Credit Facility of Rs.50.000 Millions, LC Limit of Rs.270.000 Millions, BG Limit of Rs.50.000 Millions, Forward Contract Limit of Rs.20.000 Millions, Term Loan 1 of Rs.160.000 Millions and Term Loan II of Rs.170.000 Millions.
Short particulars of the property charged (Including location of the property)	Hypothecation of all stocks of Raw Materials, Finished Goods and Book-debts of the Company (Both present and future). For CC : Paripassu 1st Charge on Current Assets of the Company alongwith IDBI Bank. Extension of Charge on Fixed Assets of the Company exclusively for SBI. For Term Loan : 1st Charge on Fixed Assets of the Company including EM of Land and Structures and hypothecation of Plant and Machinery. 2nd Charge on Current Assets of the Company.
Date of last modification prior to the present modification	07.02.2011
Particulars of the present modification	The existing CC (Hyp) Facility of Rs.190.000 Millions is enhanced to Rs.200.000 Millions, LC Facility of Rs.200.000 Millions is enhanced to Rs.270.000 Millions, Forward Contract Limit of Rs.12.000 Millions is enhanced to Rs.20.000 Millions, and Fresh Term Loan-2 Facility of Rs.17. There is no Change in Stand by Line of Credit Facility of Rs.50.000 Millions and BG Facility of Rs.50.000 Millions, Term Loan 1 of Rs.160.000 Millions in continuing and The TL Facility of Rs.40.000 Millions. has been closed. Now, the Overall Limits are Rs.920.000 Millions only.

FIXED ASSETS

Land

Buildings

• Factory
• Factory - (Unit-2)
• Non Factory
• Roads
• Compound Wall

Plant & Machinery

• Plant and Machinery
• Brequeting Plant (unit-2)
• Plant and Machinery (UNIT-2)
• Electrical Installations
• Electrical Installations(Unit-2)
• Sewage and Water Supply
• Mollases Tank
• Material Handling Equipment
• Lab Equipment
• Pollution Control Equipment
• Belt Conveyor
• Cooling Tower
• Weigh Bridge
• Weigh Bridge (UNIT-2)

AS PER WEB SITE DETAILS

PRESS RELEASE

Subject expands alloy plant at Chinthalapalem in Kothavalasa in Vizianagaram district of Andhra Pradesh. The project involves expanding Ferro Alloy Plant (High Carbon Ferro Chrome, 5,610 TPA to 14,850 TPA) by upgradation of existing Arc Furnace (3.6 MVA to 11 MVA) alongwith a Briquetting Plant (15 TPH). The expansion will be carried out at its existing premises of 7.6 acres of land. The project will entail an investment of Rs.85 million. Address : M/s Subject Srinivasa Nagar, Chinthalapalem, Kothavalasa, Vizianagaram,

Latest News

Andhra Ferro Alloys is planning to expand the Ferro Alloy Plant at Srinivasa Nagar in Chinthalapalem in Mandal Kothavalasa in Vizianagaram district of Andhra Pradesh. The proposal is to exapnd the ferro alloy plant (High Carbon Ferro Chrome, 5,610 TPA to 14,850 TPA) by upgradation of existing Arc Furnace (3.6 MVA to 11 MVA) alongwith a Briquetting Plant (15 TPH). The project is estimated to cost Rs.85 million.

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 exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

6] Records on Int’l Anti-Money Laundering Laws/Standards :

Charges or investigation registered against subject: None

7] Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

8] Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

9] Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

CONTRAVENTION

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.55.34
UK Pound	1	Rs.88.30
Euro	1	Rs.71.37

INFORMATION DETAILS

Information Gathered by :	PJA
Report Prepared by :	BYI

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
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	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		46

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.