MIRA INFORM REPORT

Report Date :

01.10.2012

IDENTIFICATION DETAILS

Name :	SEVENHILLS HEALTHCARE PRIVATE LIMITED (w.e.f. 08.12.2008)
Formerly Known As :	SEVENHILLS HEALTHCARE LIMITED
Registered Office :	11-4-4/A, Rockdale Layut, Waltaitr Main Road, Vishakhapatnam-530 002, Andhra Pradesh
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	13.04.2004
Com. Reg. No.:	01-043050
Capital Investment / Paid-up Capital :	Rs. 3509.535 millions
CIN No.: [Company Identification No.]	U85110AP2004PTC043050
PAN No.: [Permanent Account No.]	AAICS2229N
Legal Form :	Private Limited Liability Company
Line of Business :	Providing Hospital Services.
No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

B (32)

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

Maximum Credit Limit :	USD 12100000
Status :	Moderate
Payment Behaviour :	Slow but correct
Litigation :	Clear
Comments :	Subject is a well established and reputed hospital having moderate track. Even though there appears some hike in the income earned by the hospital during 2011, it has incurred heavy loss. It is in the effort of raising Rs. 3000.000 Millions by selling shares to fund its working capital requirement. Liquidity position of the hospital appears to be under pressure. However, trade relations are reported as fair. Business is active. Payments are reported to be slow but correct. The subject 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 – 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

RBI DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available RBI Defaulters’ list.

EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of 31-03-2012.

INFORMATION DENIED BY

Name :	Mr. Ram
Designation :	Finance Head
Contact No.:	91-22-67676767
Date :	26.09.2012

LOCATIONS

Registered Office :	11-4-4/A, Rockdale Layut, Waltaitr Main Road, Vishakhapatnam-530 002, Andhra Pradesh, India
Tel. No.:	91-22-67676767 / 891-2708090
Fax No.:	91-22-67676718 / 891-2565635
E-Mail :	info@sevenhillshospital.com
Corporate Office :	Marol – Maroshi Road, Andheri (East), Mumbai – 400 059, Maharashtra, India
Tel. No.:	91-22-29258961
Fax No.:	91-22-29254188
E-Mail :	shhl@sevenhillshospital.com

DIRECTORS

As on 30.09.2011

Name :

Tanmaya Misra

Designation :

Alternate Dirtector to Mr. S. Vijay Pattabhiraman

Address :

22, 2^nd Floor, Palm Crest, 191-192, St. Paul’s Road, Bandra (West), Mumbai – 400 050, Maharashtra, India

Date of Birth/Age :

03.05.1970

Date of Appointment :

30.06.2011

DIN No.:

02309166

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	U85110AP2004PTC043050	SEVENHILLS HEALTHCARE PRIVATE LIMITED	Nominee director	30/06/2012	18/11/2009	-	Active	NO
2	U40100TZ2006PTC013130	LEAP GREEN ENERGY PRIVATE LIMITED	Director	26/07/2011	21/10/2010	-	Active	NO
3	U40108TZ2011PTC016849	CLOVER ENERGY PRIVATE LIMITED	Director	11/03/2011	11/03/2011	-	Active	NO
4	U40108TZ2011PTC016873	OLIVE ECOPOWER PRIVATE LIMITED	Director	18/03/2011	18/03/2011	-	Active	NO
5	U40108TZ2011PTC017250	MAPLE RENEWABLE POWER PRIVATE LIMITED	Director	26/07/2011	26/07/2011	-	Active	NO
6	U45203AP2006PTC051015	SOMA TOLLWAYS PRIVATE LIMITED	Nominee director	22/08/2011	28/07/2011	-	Active	NO
7	U40108TZ2011PTC017271	LOTUS CLEAN POWER VENTURE PRIVATE LIMITED	Director	22/10/2011	22/10/2011	-	Active	NO

Name :

Dr. Jitendra Das Maganti

Designation :

Chairman cum Managing Director

Address :

House No.36, Balaji Baymount, Tarakarama Layout, Peda Rushikonda, Visakhapatnam – 530045, Andhra Pradesh, India

Date of Birth/Age :

22.08.1955

Date of Appointment :

13.04.2004 (As CMD w.e.f 15.04.2004)

DIN No.:

00085118

PAN No.:

ABYPM0767D

Other Directorship:

Name :

Mr. Maganti Renukarani

Designation :

Managing Director

Address :

House No.36, Balaji Baymount, Tarakarama Layout, Peda Rushikonda, Visakhapatnam – 530045, Andhra Pradesh, India

Date of Birth/Age :

12.03.1961

Date of Appointment :

01.04.2007

DIN No.:

00085209

PAN No.:

ABKPR3835M

Voter ID No.:

BGY3I25044

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	U45209AP1984PTC004713	PENINSULAR POWER VENTURES PRIVATE LIMITED	Director	16/05/1984	16/05/1984	-	Active	NO
2	U85110AP1984PTC004938	SEVEN HILLS HOSPITALS PRIVATE LTD	Managing director	01/04/2007	28/08/1984	-	Amalgamated	NO
3	U85110AP2004PTC043050	SEVENHILLS HEALTHCARE Private LIMITED	Managing director	13/04/2004	13/04/2004	-	Active	NO
4	U55101AP1984PTC004975	JITENDRA HOTELS PVT LTD	Director	29/09/2008	04/02/2008	-	Active	NO
5	U85110AP1990PTC011027	SEVEN HILLS HEALTH SERVICES PVT LTD	Director	29/09/2008	06/02/2008	-	Active	NO
6	U73100MH2010NPL204993	SevenHills Medical Foundation	Director	28/06/2010	28/06/2010	-	Active	NO
7	U72200AP2011PTC076414	SEVENHILLS e-HEALTH PRIVATE LIMITED	Director	09/09/2011	09/09/2011	-	Active	NO

Name :

Dr. Nandamuri Prabhakara Babu

Designation :

Whole-time director

Address :

401, Vietla Vantage, Vijayanagar Palace Layout, Peda Wattair Junction

Visakhapatnam – 530 017, Andhra Pradesh, India

Date of Birth/Age :

13 08.1952

Date of Appointment :

01.04.2007

DIN No.:

00085243

PAN No.:

ABQPN4224J

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	U85110AP1984PTC004938	SEVEN HILLS HOSPITALS PRIVATE LTD	Whole-time director	01/04/2007	01/11/1999	-	Amalgamated	NO
2	U85110AP2004PTC043050	SEVENHILLS HEALTHCARE Private LIMITED	Whole-time director	14/11/2009	13/04/2006	-	Active	NO
3	U73100MH2010NPL204993	SevenHills Medical Foundation	Director	28/06/2010	28/06/2010	-	Active	NO

Name :

Dr Kuchela Babu Venkineni

Designation :

Director

Address :

Flat No.9-17-28/5, Gitanjali Apartments, CBM Compound, Visakhapatnam – 530 003, Andhrapradesh, India

Date of Birth/Age :

05.03.1951

Date of Appointment :

06.09.2006

DIN No.:

00085187

PAN No.:

AAZPK8473A

Voter ID No.:

BGY6761217

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	U85110AP1984PTC004938	SEVEN HILLS HOSPITALS PRIVATE LTD	Director	01/11/1999	01/11/1999	-	Amalgamated	NO
2	U85110AP2004PTC043050	SEVENHILLS HEALTHCARE PRIVATE LIMITED	Director	06/09/2006	05/04/2006	-	Active	NO
3	U73100MH2010NPL204993	SEVENHILLS MEDICAL FOUNDATION	Director	28/06/2010	28/06/2010	23/07/2010	Active	NO

Name :

Subramanian Vijay Pattabhiraman

Designation :

Nominee Director

Address :

BLK 560, East Cost Road – 16-03, Singapore – 458970

Date of Birth/Age :

23.09.1966

Date of Appointment :

06.10.2008

DIN No.:

02329368

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	U85110AP2004PTC043050	SEVENHILLS HEALTHCARE PRIVATE LIMITED	Nominee director	06/10/2008	06/10/2008	30/06/2012	Active	NO
2	U40100TZ2006PTC013130	LEAP GREEN ENERGY PRIVATE LIMITED	Director	26/07/2011	21/10/2010	-	Active	NO
3	U85110KA2000PLC026939	NANDI ECONOMIC CORRIDOR ENTERPRISES LIMITED.	Director	07/04/2011	14/03/2011	-	Active	NO

KEY EXECUTIVES

Name :	Mrs. Chhaya Jain
Designation :	Secretary
Address :	32/415, Arjan Vihar, New Delhi – 110 010, India
Date of Birth/Age :	17.08.1976
Date of Appointment :	01.08.2008
PAN No.:	AFDPJ6238D

MAJOR SHAREHOLDERS

As on 30.09.2011

Names of Equity Shareholders	No. of Shares
Dr. Jitendra Das Maganati (IND)	615789
Renuka Rani Maganti	898786
Dr. Jitendra Das Maganati ad karta of maganati Jitendra Das (HUF)	49438925
AIRRO (Mauritius) Holdings I	01
TOTAL	50953501

As on 30.09.2011

Names of Preference Shareholders	No. of Shares
AIRRO (Mauritius) Holdings I	30000000
TOTAL	30000000

Equity Share Break up (Percentage of Total Equity)

Category	Percentage
Directors or relatives of Directors	100.00
Total	100.00

BUSINESS DETAILS

Line of Business :

Providing Hospital Services.

Products :

ITC Code	Product Descriptions
--	Healthcare Services

GENERAL INFORMATION

No. of Employees :

Not Available

Bankers :

v Allahabad Bank (Lead Bank), Industrial Finance Branch, 2^nd Floor, Allahabad Bank Building, 37 M.S. Marg, Fort, Mumbai – 400 023, Maharashtra, India

v Axis Bank

v Bank of Maharashtra

v Canara Bank

v Central Bank of India

v Punjab & Sind Bank

v State Bank of Hyderabad

v State Bank of Travancore

v State Bank of Mysore

v State Bank of Patiala

v UCO Bank

v Union Bank of India

Facilities :

Secured Loan	As on 31.03.2011 (Rs. in Millions)	As on 31.03.2010 (Rs. in Millions)
Rupee term loans banks secured Working capital loans banks secured	(A)6211.490 (B)510.774	4117.480 105.688
Total	6722.264	4223.168

NOTE:

(A) 2. Term loans are secured by first charge by way of equitable mortgage on all the present and future immovable assets of the Company, lease hold rights of the plot of land exclusively marked for the hospital, residential building and MASC project and first charge by way of hypothecation of all the present and future movable assets, all the present and future rights, titles and interests of the

Company from all contracts, insurances, documents which the Company is party, all present and future current assets including revenues, receivables and escrow account and are collaterally secured by personal guarantee of directors.

(B) 1. Short term working capital loans are secured by first charge by way of equitable mortgage on all the present and future immovable assets of the Company, lease hold rights of the plot of land exclusively marked for the hospital, residential building and MASC project and first charge by way of hypothecation of all the present and future movable assets, all the present and future rights, titles and interests of the Company from all contracts, insurances, documents which the Company is party, all present and future current assets including revenues, receivables and escrow account.

Banking Relations :	--
Auditors :
Name :	B S R R and Company Chartered Accountants
Address :	Reliance Humsafar, IV Floor, Banjara Hills, Road No. 11, Hyderabad – 500 034, India
PAN No.:	AAKFB1884H
Enterprises where key management personnel have control or significant influence (“Significant interest entities”):	v SevenHills Foundation v SevenHills Medical Foundation [CIN No.: U73100MH2010NPL204993] v SevenHills Health Services Private Limited [CIN No.: U85110AP1990PTC011027] v Maganti Trust v Maganti Jitendra Das (HUF)
Others:	v AIRRO(Mauritius) Holdings I, MAURITIUS

CAPITAL STRUCTURE

As on 30.09.2011

Authorized Capital:

No. of Shares	Type	Value	Amount
101000000	Equity Shares	Rs. 10/- each	Rs. 1010.000 millions
30000000	Preference Shares	Rs. 100/- each	Rs. 3000.000 millions
	TOTAL		Rs. 4010.000 millions

Issued, Subscribed & Paid-up Capital:

No. of Shares	Type	Value	Amount
50953501	Equity Shares	Rs. 10/- each	(A)Rs. 509.535 millions
30000000	Preference Shares	Rs. 100/- each	(B)Rs. 3000.000 millions
	TOTAL		Rs. 3509.535 millions

NOTE:

(A) 1.Includes 31,462,500 (previous year: 31,462,500) shares of Rs.10/- each were allotted pursuant to a scheme

of amalgamation.

(B) 2.The compulsorily convertible preference shares of Rs.100/- each has an option to convert the whole or part of the 0.01% compulsorily convertible preference shares ("CCPS") into equity shares at any time after the expiry of thirty months from the first closing date. Notwithstanding the aforementioned option the CCPS shall be compulsorily convertible at the earlier of the last permissible date for conversion under the applicable law in connection with the Initial Public Offer, fifth anniversary of the first closing date or in the event of winding up of the company. The conversion price is higher of Rs.10 or a price which upon conversion will give the preference shareholder a 35% stake in the Company if conversion is carried out before the expiry of fifth anniversary of the issue or minimum shareholding percentage defined as 26.5% or 24.1% depending on achievement of EBIDTA incase the conversion occurs on expiry of the fifth anniversary.

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		3509.535	3509.535	2694.910
2] Share Application Money		10.000	10.000	314.625
3] Reserves & Surplus		(487.855)	107.897	74.798
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		3031.680	3627.432	3084.333
LOAN FUNDS
1] Secured Loans		6722.264	4223.168	2668.407
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		6722.264	4223.168	2668.407
DEFERRED TAX LIABILITIES		0.000	82.043	64.267
TOTAL		9753.944	7932.643	5817.007
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		4849.273	3725.293	313.320
Capital work-in-progress		4434.859	3800.698	4275.320
INVESTMENT		0.009	0.009	0.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	53.070	70.166	75.386
	Sundry Debtors	78.461	124.989	138.205
	Cash & Bank Balances	418.955	371.433	1095.922
	Other Current Assets	21.492	9.465	0.000
	Loans & Advances	290.877	129.429	64.583
Total Current Assets		862.855	705.482	1374.096
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	196.009	176.410	106.235
	Other Current Liabilities	187.633	129.611	40.121
	Provisions	9.410	6.788	0.000
Total Current Liabilities		393.052	312.809	146.356
Net Current Assets		469.803	392.673	1227.740
MISCELLANEOUS EXPENSES		0.000	13.970	0.627
TOTAL		9753.944	7932.643	5817.007

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
Gross Income		811.010	604.120	548.920
EXPENSES		NA	NA	NA
PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION		(136.610)	156.250	171.460
FINANCIAL EXPENSES		351.730	42.820	31.840
PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION		(488.340)	113.430	139.620
DEPRECIATION/ AMORTISATION		189.200	28.620	21.440
PROFIT BEFORE TAX		(677.540)	84.810	118.180
TAX		(81.790)	38.120	42.260
PROFIT AFTER TAX		(595.750)	46.690	75.920
Prior period items		0.000	13.590	1.120
PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		107.890	74.790	0.000
BALANCE CARRIED TO THE B/S		(487.860)	107.890	74.800
IMPORTS
	Capital Goods	256.916	470.000	38.790
TOTAL IMPORTS
Earnings Per Share (Rs.)		(11.69)	0.65	--

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
Return on Total Assets (PBT/Total Assets}	(%)	(11.86)	1.91	7.00
Return on Investment (ROI) (PBT/Networth)		(0.22)	0.02	0.03
Debt Equity Ratio (Total Liability/Networth)		2.34	1.25	0.91
Current Ratio (Current Asset/Current Liability)		2.19	2.25	9.38

LOCAL AGENCY FURTHER INFORMATION

Sr. No.	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	Yes
8]	No. of employees	No
9]	Name of person contacted	Yes
10]	Designation of contact person	Yes
11]	Turnover of firm for last three years	Yes
12]	Profitability for last three years	Yes
13]	Reasons for 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)	No
21]	Market information	----
22]	Litigations that the firm / promoter involved in	----
23]	Banking Details	Yes
24]	Banking facility details	Yes
25]	Conduct of the banking account	----
26]	Buyer visit details	----
27]	Financials, if provided	Yes
28]	Incorporation details, if applicable	Yes
29]	Last accounts filed at ROC	Yes
30]	Major Shareholders, if available	Yes
31]	Date of Birth of Proprietor/Partner/Director, if available	Yes
32]	PAN of Proprietor/Partner/Director, if available	Yes
33]	Voter ID No of Proprietor/Partner/Director, if available	Yes
34]	External Agency Rating, if available	No

Background

SevenHills Healthcare Private Limited (‘the Company’) was originally incorporated on 13 April 2004 as a public limited company and subsequently converted in to a private limited company on 8 December 2008. The Company is primarily engaged in business of rendering medical and healthcare services at Visakhapatnam and Mumbai.

REVIEW OF OPERATION:

During the year the Company has recorded an income of Rs 811.010 Millions in aggregate from Vizag and Mumbai units which is higher by 34% to the previous year’s income of 604.110 Millions. The Company has incurred an expenditure of Rs.1488.560 Millions during the year in comparison to Rs. 519.310 Millions incurred during last year. The Company has incurred a loss of Rs.677.540 Millions during the reporting year as compared to the profit before tax of Rs. 84.800 Millions for the last year.

HEALTHCARE INDUSTRY OUTLOOK & SCENARIO:

The Indian healthcare market is one of the prominent contributors to the country’s gross domestic product ( GDP) having attracted a large number of players - domestic as well as international during the past few years. Highly qualified doctors and scientists, state-of-the-art technology and low costs have helped India to become an attractive global destination for medical tourism, clinical studies, and research and development (R&D) programs. The sector offers massive growth potential and a chance to capitalise on its expansion.

CRISIL Research has estimated the market size for healthcare delivery (hospitals) to be 3.1 billion treatments in FY10, which translates into Rs. 1,816 billion in value terms. Of this total market, the share of in-patients and out-patients is 63 per cent and 37 per cent in value terms respectively.

CRISIL Research expects the market to grow at a CAGR of 12 per cent over the next 5 years growing from Rs. 1,816 billion in FY10 to Rs. 3,500 billion by FY15. The growth will be mainly driven by a number of factors including a shift in demographics, increasing health awareness and improving health coverage. Expansions being made by major private players are expected to be skewed towards the treatment of in-patient department (IPD) related illness. The share of the IPD by value is expected to increase from 63 to 66 per cent by FY15.

Growth in the healthcare delivery market will be driven by a combination of demographic and economic factors:

Change in demographics: India ’s population is expected to grow from around 1.1 billion in 2009-10 to over 1.4 billion by 2026. The number of treatments required is therefore expected to increase in tandem. As current healthcare delivery systems remain woefully inadequate, there is tremendous opportunity for growth.

In addition, as a result of increasing life expectancy, the proportion of people above 60 years is also expected to increase to over 12 per cent from current levels of around 8 per cent. As the requirement for healthcare delivery amongst the senior citizens is high, this shift in demographics signals the need for greater coverage of healthcare in the coming years.

Rising income levels: Though healthcare may be considered a non-discretionary expense, high-quality healthcare facilities are unaffordable for a large percentage of the population. As income levels across the population rise, the purchasing power increases, making higher-quality healthcare affordable for a larger section of the population and thereby providing an impetus for demand growth.

Over the next 5 years, the share of households in the lowest income bracket (below Rs 1 lakh per annum), is expected to decline from current levels of 55 per cent to as low as 38 per cent by 2014-15. On the other hand, the share of households in the above 2 lakhs per annum bracket is expected to increase from 14 per cent to 26 per cent, indicating a strong increase in the disposable incomes of households.

Rising health awareness: With the rise in literacy levels across the country, greater percentage of the population recognises the need for quality preventive and curative healthcare. This is likely to result in an increased demand for healthcare delivery services as the hospitalisation rate (percentage of people who actually visit a hospital when unwell) will increase.

Changing disease profile: As a result of changing demographics (a greater percentage share of the population in the 30-60 age group), and rising incomes (a greater percentage of households earning more than 2 lakhs per annum), amongst whom the incidence of lifestyle related diseases such as diabetes and hypertension is highest; the disease profile of the country is expected to change. The prevalence of lifestyle related diseases is expected to increase; consequently, the demand for healthcare services pertaining to ailments such as diagnostic facilities and OPD centres for regular checkups is expected to increase.

Health insurance coverage: Over 95 per cent of India ’s private healthcare expenditure currently takes place in the form of out-of-pocket expenditure as health insurance coverage is under 5 per cent. As the penetration of health insurance increases, healthcare is likely to become more affordable for a larger percentage of the population. As a result, hospitalisation rates (the percentage of times an individual actually visits a hospital when he/she needs to) is expected to increase. In addition, health checkups, which form a mandatory part of health insurance coverage, are also expected to increase, boosting the demand for an adequate healthcare delivery system.

Medical tourism: Medical tourism has gained momentum over the years and India is fast emerging as a major medical tourist destination. As governments across the globe and patients worldwide struggle with soaring healthcare costs, the relatively low cost of surgery and critical care in India is drawing the attention of global healthcare providers. These private healthcare players are collaborating with Indian tourism to tap the potential of this burgeoning industry.

India is extremely competitive in healthcare costs vis-à-vis the developed countries and other nations in Asia. The fact that India offers advanced medical facilities in critical areas such as cardiology, joint replacement, urology, ophthalmology organ transplants and orthopaedics adds to its competitive advantage. The presence of large private hospital chains, whose hospitals are globally renowned, enhances India ’s status as an attractive destination for medical tourism.

A Micro Market Analysis- Mumbai Healthcare scenario and outlook:

Mumbai has about 17 municipal hospitals which can be afforded by the urban poor who make up 50% of the population. Mumbai’s geographic location makes it a very accessible hub for people coming from overseas. It has one of the busiest international airports. Mumbai has a number of excellent hospitals and specialty centres, which have seen an increased influx of patients from abroad.

It has been estimated that while the city as a whole may be close to the WHO norms of 3 beds per 1,000 population, the entire primary service area for the Mumbai hospital has a significantly lower bed availability at an average of just 1.2 beds per 1,000 population (based on extrapolation of the census of 2001). There is acute deficit of about 3,800 beds in the primary service area for the hospital comprising of Kurla, Andheri (East), Khar and Santa Cruz.

Despite this present capacity and future capacity additions in the healthcare delivery market in Mumbai, our hospital enjoys major competitive strengths from the following aspects:

High density of population with a large demand and supply gap Efficient capital costs Fully integrated business model Wide spread target market Advanced diagnostic, procedural and surgical equipments State-of-the-art infrastructure & facilities The future of healthcare industry is no doubt promising and impressive. With the personal disposable income rising by more than 70 per cent and overall income of the population rising, the demand for better quality in healthcare is bound to exponentially rise. With the country's healthcare industry poised to grow to USD 125 billion in the next five years, and only two major listed companies with a market cap of more than a billion dollars, there is huge potential for many other players to gain market share and grow.

BANKERS CHARGES REPORT AS PER REGISTRY

Corporate identity number of the company	U85110AP2004PTC043050
Name of the company	SEVENHILLS HEALTHCARE PRIVATE LIMITED
Address of the registered office or of the principal place of business in India of the company	11-4-4/A, Rockdale Layut, Waltair Main Road, Visakhapatnam, Andhra Pradesh – 530002, India e-mail: info@sevenhillshospital.com
This form is for	Modification of charge
Charge identification number of the modified	10009626
Type of charge	Immovable Property Book Debts Movable Property Present and future Fixed Assets
Particular of charge holder	Allahabad Bank (Lead Bank), Industrial Finance Branch, 2^nd Floor, Allahabad Bank Building, 37 M.S. Marg, Fort, Mumbai – 400 023, Maharashtra, India e-mail: br.mumifb@allahabadbank.in
Nature of description of the instrument creating or modifying the charge	1. Third Supplemental Joint Deed of Hypothecation dated 10.10.2011 2. Deed of Mortgage dated 10.10.2011
Date of instrument Creating the charge	10.10.2011
Amount secured by the charge	Rs. 6620.000 millions
Brief particulars of the principal terms an conditions and extent and operation of the charge	Margin Bank Guarantee: 5% Extent and Operation of the charge Mortgage of Leasehold 'Hospital Site' being all the piece and parcel of land ad measuring 57209 Sq. mtrs together hospital bldg, such other bldg, structures and constructions thereon. Present and future fixed assets (all movable and immovable assets) of the hospital, generated from and out of the total investment in the hospital incl. the investment made by the Borrower. 2nd pari passu charge on al its present and future current assets/ receivables/ book debts of the Company.
Short particulars of the property charged	All piece and parcel of land bearing Survey Nos. 155 (prt),156 (prt),162 (prt) to168 (prt) 208 (prt), admsg 57209 sq. mtrs or thereabout situate within Muncipal "K(East)" at Marol-Maroshi, Andheri (E) Mumbai Present and future fixed assets (all movable and immovable assets) of the hospital, generated from and out of the total investment in the hospital incl. the investment made by the Borrower 2nd pari passu charge on al its present and future current assets/ receivables/ book debts of the Company.
Date of latest modification prior to the present modification	20.01.2010
Particulars of the present modification	The term loan amounting to Rs. 4294.900 Crs sanctioned by Allahabad Bank consortium has been enhanced to Rs. 6520.200 Millions, by sanctioning of term Loan of Rs. 2225.300 Millions by Axis Bank Limited and Non fund based BG facility of Rs. 100.000 Millions (in lieu of State Bank of Hyderabad's BG facility of similar amount).

COMMITMENTS AND CONTINGENT LIABILITIES

(Rs. in millions)

Particulars	31.03.2011
Guarantees issued by banks	101.027
Estimated amount of contracts remaining to be executed on capital account and not provided for	387.338
Claims against the Company not acknowledged as debts in respect of: Sales tax matter in dispute Claim by employee Amounts disputed by supplier	0.412 0.000 0.219
Medical claims
Income tax matters in dispute:- The department had disallowed certain interest on borrowed funds during the assessment years 1992-93 and 1993-94. Aggrieved by the order, the Company preferred an appeal to Tribunal and won the case. However, the department subsequently filed an appeal against the judgment of Tribunal in High Court. The matter has not come up for hearing so far and the Company currently does not have the relevant documents in hand to determine quantum involved.
Custom duty on account of Export Promotion Capital Goods Scheme Rs. 98,148,554. The Company believes that it would be able to meet its export obligation and accordingly has made no provision in the books.

FIXED ASSETS:

v Lease hold land

v Office building

v Plant machinery

v Office equipments

v Computer equipments

v Furniture fixtures

v Motor vehicles

v Leasehold properties

v Computer software

PRESS RELEASE

Seven Hills Healthcare in talks for equity funding

Mumbai: Seven Hills Healthcare Pvt. Ltd which operates Asia’s largest private hospital in Mumbai, is looking to raise as much as Rs.3000.000 millions by selling shares to fund its working capital requirements.

“The company is looking to raise Rs.2500.000 millions to Rs.3000.000 millions in equity funding in exchange for a significant minority stake,” said a person who declined to be named as he is directly involved in the matter.

The 17-acre Seven Hills Hospital in Andheri, a Mumbai suburb, hosts 1,500 beds and 36 operation theatres. It grabbed headlines last year when Hindi film actress Aishwarya Rai delivered a baby there.

“Since the Mumbai facility is one of the largest projects within the company, it requires large investments in various phases,” a company official said, requesting anonymity. “We have been exploring various finance options to part-fund the next phase of expansion.” He declined to name the investment banker running the firm’s mandate of raising money. Seven Hills declined to comment. The company has also asked key lenders to recast its debts that total Rs.8000.000 millions. “The proposal (for corporate debt restructuring or CDR) is not yet admitted as all lenders are not supporting the proposal,” said a banker involved with the CDR process.

Axis Bank Ltd, which has lent more than half the amount to Seven Hills, is yet to agree to the recast proposal, the banker said.

“Banks are yet to agree for the CDR as they do not have full clarity from the company regarding certain clearances,” an Axis Bank official said on condition of anonymity, citing the sensitivity of the issue. “Once that clarity comes, banks may agree for the loan restructuring in due course.”

Banks typically ease terms or stretch repayment periods if there is a possibility of loans turning bad.

India’s healthcare sector has seen some activity this year in terms of mergers and acquisitions and private equity investment. Pharmaceuticals and manufacturing are the two most promising segments in both domestic and cross-border deal activity this year, according to an annual survey released in February by Grant Thornton, an advisory.

Private equity investment in healthcare till mid-August more than tripled in value compared with the year-ago period. Till 15 August, there were 30 such deals worth $727.15 million, compared with 19 deals worth $180.71 million a year ago.

Some of the prominent transactions in healthcare include Advent International Corp.’s $110 million investment in Hyderabad-based hospital chain Care Hospitals Pvt. Ltd. Others include Government of Singapore Investment Corp. Pte Ltd’s $100 million investment in March in Vasan Healthcare Pvt. Ltd, which operates eye hospitals.

Investment bankers say equity firms’ interest in healthcare will continue across segments as not only is this sector insulated from global economic slowdown but also because investments in such firms have offered positive exits to the investors with high returns.

“Investors have made good returns in the last four years, be it Olympus Capital’s DM Healthcare, which offered a part exit to India Value Fund, or IDFC Project Equity’s investment Sahyadri Hospitals Ltd, which gave an exit to ICICI Venture,” said C. Venkat Subramanyam, founder director of Veda Corporate Advisors Pvt. Ltd, an investment bank.

“There are macro-economic factors impacting the healthcare sector positively, including penetration of medical insurance products, aspirations to go for specialized chains even if one pays a bit more,” said Sujay Kotak, associate vice-president at Singhi Advisors Ltd, a Mumbai-based investment bank.

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.52.70
UK Pound	1	Rs.85.71
Euro	1	Rs.68.15

INFORMATION DETAILS

Information Gathered by :	PJA
Report Prepared by :	NID

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	3
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	5
--PROFITABILIRY	1~10	-
--LIQUIDITY	1~10	3
--LEVERAGE	1~10	3
--RESERVES	1~10	3
--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	NO
--AFFILIATION	YES/NO	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		32

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.