MIRA INFORM REPORT

Report Date :

20.10.2012

IDENTIFICATION DETAILS

Name :	TRANSFORMERS AND RECTIFIERS (INDIA) LIMITED
Registered Office :	Survey No. 344-350, Opposite PWD Store, Sarkhej Bavla Highway, Village Changodar, Taluka Sanand, District Ahmedabad – 382 210, Gujarat
Country :	India
Financials (as on) :	31.03.2012
Date of Incorporation :	11.07.1994
Com. Reg. No.:	04-22460
Capital Investment/ Paid-up Capital:	Rs. 129.236 Millions
CIN No.: [Company Identification No.]	L33121GJ1994PLC022460
TAN No.: [Tax Deduction & Collection Account No.]	AHMT00243F
PAN No.: [Permanent Account No.]	AAAFT9000B
Legal Form :	A Public Limited Liability Company. The Company’s Shares are Listed on the Stock Exchanges.
Line of Business :	Manufacturer of Transformers.
No. of Employees:	1000 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

A (57)

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 13140000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is well established and a reputed company. The Directors are experienced businessmen. In the current year their is sharp dip in profitability. However financial appears to be strong. Networth appears to be healthy. Creditworthiness appears strong. Trade relations are reported to be 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.

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	CARE
Rating	A+ (Long Term Bank Facilities)
Rating Explanation	Having adequate degrees of safety regarding timely servicing of financial obligation it carry low credit risk
Date	July 2012

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.

LOCATIONS

Registered Office/Factory :	Survey No. 344-350, Opposite PWD Store, Sarkhej Bavla Highway, Village Changodar, Taluka Sanand, District Ahmedabad – 382 210, Gujarat, India
Tel. No.:	91-2717-661661 (10 Lines)
Fax No.:	91-2717-661716
E-Mail :	tushar@transformerindia.com info@transformerindia.com
Website :	www.transformerindia.com
Factory 1:	Plot No.233, GVMSAV Limited, Odhav, Ahmedabad, Gujarat, India
Factory 2 :	Survey No.: 427/3/p, Village Moraiya, Ahmedabad, Gujarat, India
Factory 3:	Changodar Unit, Changodar, Ahmedabad, Gujarat, India
Factory 4:	Fabrication Unit, Odhav, Ahmedabad, Gujarat, India

DIRECTORS

As on 31.03.2012

Name :	Mr. Jitendra U. Mamtora,
Designation :	Chairman Cum Managing Director
Date of Appointment :	01.04.2007
Name :	Mr. Satyen J Mamtora
Designation :	Joint Managing Director
Date of Appointment :	01.04.2007
Name :	Mrs. Karuna J. Mamtora
Designation :	Executive Director
Date of Birth/Age:	61 Years
Qualification:	M.B.A
Date of Appointment :	01.04.2005
Expertise in specific functional areas:	Implementation and Formulation of Corporate Social Responsibility and General Administrative function and the Human Resource Development
List of Outside Company Directorship held:	Transpares Limited
Name :	Mr. Vinod Masson
Designation :	Executive Director
Date of Birth/Age:	65 Years
Qualification:	B.E. Electrical
Date of Appointment :	11.04.2012
Expertise in specific functional areas:	40 years of experience in the Power Sector in Indian & Global Markets
Name :	Mr. Bhaskar Sen
Designation :	Independent Director
Date of Appointment :	25.08.2005
Name :	Mr. Michael B. Homawalla
Designation :	Director
Name :	Mr. Rajendra S. Shah
Designation :	Director
Date of Appointment :	09.07.2007
Name :	Mr. Harish R. Rangwala
Designation :	Director
Name :	Mr. Sureshchandra Agarwal,
Designation :	Director
Date of Birth/Age:	62 Years
Qualification:	Mechanical Engineer
Date of Appointment :	13.08.2007
Expertise in specific functional areas:	Vast experience in the metal recovery and petroleum refining industry.
List of Outside Company Directorship held:	Mahagujarat Smelting Company Private Limited

KEY EXECUTIVES

Name :	Mr. Samkit Mehta
Designation :	Chief Financial Officers
Name :	Mr. Tushar Shah
Designation :	Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 30.06.2012

Category of Shareholders	No. of Shares	Percentage of Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	9928415	76.82
Sub Total	9928415	76.82
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	9928415	76.82
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	356442	2.76
Financial Institutions / Banks	21000	0.16
Foreign Institutional Investors	8613	0.07
Sub Total	386055	2.99
(2) Non-Institutions
Bodies Corporate	292751	2.27
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 Million	2164368	16.75
Individual shareholders holding nominal share capital in excess of Rs. 0.100 Million	24753	0.19
Any Others (Specify)	127269	0.98
Clearing Members	68516	0.53
Non Resident Indians	45778	0.35
Directors & their Relatives & Friends	8960	0.07
Trusts	4015	0.03
Sub Total	2609141	20.19
Total Public shareholding (B)	2995196	23.18
Total (A)+(B)	12923611	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	--	--
Total (A)+(B)+(C)	12923611	-

BUSINESS DETAILS

Line of Business :

Manufacturer of Transformers.

Products :

Item Code No. :	8504
Product Description :	Electric Transformer

PRODUCTION STATUS AS ON (31.03.20110

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
Electric Transformer	MVA	NA	23200	513 (Nos.)

GENERAL INFORMATION

No. of Employees :

1000 (Approximately)

Bankers :

• State Bank of India
• Bank of Baroda
• Axis Bank
• Standard Chartered Bank
• IDBI Bank

Facilities :

Secured Loans	As on 31.03.2012 Rs. in millions	As on 31.03.2011 Rs. in millions
SHORT TERM BORROWINGS
Cash credit and short term loan from banks	400.423	570.133
Foreign currency demand loan from banks	0.000	66.965
Total	400.423	637.098

Nature of Security:

The above cash credit and short term loan from banks are secured by hypothecation of current assets of the Company on paripassu basis and collaterally secured by residual value of net fixed assets of the Company excluding fixed assets of moraiya plant and also collaterally legal mortgage on paripassu basis on immovable properties situated at changodar, dhank and ahmedabad and in addition to above secured by pledge of 2,110,000 equity shares of promoter and personal guarantees of some of the directors

Banking Relations :	--
Auditors :
Name :	Deloitte Haskins and Sells Chartered Accountants
Address :	Heritage, Near Gujarat Vidhyapith, Ahmedabad – 380014, Gujarat, India
Subsidiaries:	Transweld Mechanical Engineering Works Limited Transpares Limited
Associates :	Savas Engineering Company Private Limited
Enterprise over which key Managerial Personnel is able to exercise significant Influence :	Benchmark HR Solutions (India) Private Limited Jitendra U. Mamtora (HUF) Transpower Skytrek Tours and Travels

CAPITAL STRUCTURE

As on 31.03.2012

Authorised Capital :

No. of Shares	Type	Value	Amount
15000000	Equity Shares	Rs.10/- each	Rs. 150.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
12923611	Equity Shares	Rs.10/- each	Rs. 129.236 Millions

(i) Reconciliation of the number of Equity Shares outstanding at the beginning and at the end of the reporting period

Particular	Shares
At the Beginning of the period	12923611
Outstanding at the end of the period	12923611

(ii) Details of shareholders holding more than 5% of equity shares

Particular	No. Shares	% Holding
Jitendra U. Mamtora	8858992	68.55
Jitendra U. Mamtora (HUF)	682931	5.28

(iii) Details of Equity Shares allotted as fully paid up by way of bonus shares, shares issued for consideration other than cash (During last 5 years immediately preceding reporting date)

Particular	Shares
Equity shares allotted as fully paid bonus shares	2,836,746

(iv) Rights of Equity Shares

The Company has one class of equity shares having a par value of Rs. 10 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to approval of the shareholders in ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity share holders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2012	31.03.2011	31.03.2010
SHAREHOLDERS FUNDS
1] Share Capital		129.236	129.236	129.236
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		3155.619	3063.789	3063.789
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		3284.855	3193.025	3193.025
LOAN FUNDS
1] Secured Loans		400.423	637.098	640.975
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		400.423	637.098	640.975
DEFERRED TAX LIABILITIES		73.641	63.530	63.530
TOTAL		3758.919	3893.653	3897.530
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		993.351	875.428	875.428
Capital work-in-progress		272.203	163.380	180.849
INVESTMENT		21.119	21.119	21.119
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	940.503	1063.636	1063.636
	Sundry Debtors	1741.423	2228.649	2314.910
	Cash & Bank Balances	779.802	541.991	555.160
	Other Current Assets	106.112	134.571	0.000
	Loans & Advances	342.465	249.270	266.942
Total Current Assets		3910.305	4218.117	4200.648
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	781.867	1011.393	964.479
	Other Current Liabilities	647.978	293.644	336.681
	Provisions	8.214	79.354	79.354
Total Current Liabilities		1438.059	1384.391	1380.514
Net Current Assets		2472.246	2833.726	2820.134
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		3758.919	3893.653	3897.530

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2012	31.03.2011	31.03.2010
	SALES
		Income	5121.506	5368.410	5150.995
		Other Income	66.623	70.991	81.060
		TOTAL (A)	5188.129	5439.401	5232.055
Less	EXPENSES
		Cost of Raw Materials Consumed	4246.922	4441.658
		Manufacturing Expenses	232.739	195.108
		Employee Benefits Expense	165.428	160.748
		Other Expenses	271.746	280.069	4394.685
		(Increase)/Decrease in Stock of Finished Goods and Process Stock	(3.476)	(328.517)
		TOTAL (B)	4913.359	4749.066	4394.685
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		274.770	690.335	837.370
Less	FINANCIAL EXPENSES (D)		81.806	44.099	47.038
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		192.964	646.236	790.332
Less/ Add	DEPRECIATION/ AMORTISATION (F)		61.136	57.941	44.106
	PROFIT BEFORE TAX (E-F) (G)		131.828	588.295	746.226
Less	TAX (H)		39.998	187.191	251.138
	PROFIT AFTER TAX (G-H) (I)		91.830	401.104	495.088
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		1494.083	1217.435	847.203
Less	APPROPRIATIONS
		Proposed Dividend		64.618	64.618
		Tax on Dividend	NA	9.838	10.238
		Transferred to General Reserve		50.000	50.000
	BALANCE CARRIED TO THE B/S		NA	1494.083	1217.435
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	473.568	639.267	661.801
	TOTAL EARNINGS		473.568	639.267	661.801
	IMPORTS
		Raw Materials	282.392	365.901	385.504
		Capital Goods	30.350	14.858	23.570
	TOTAL IMPORTS		312.742	380.759	409.074
	Earnings Per Share (Rs.)		7.11	31.04	38.31

QUARTERLY RESULTS

PARTICULARS	30.06.2012
Net Sales	851.900
Total Expenditure	822.600
PBIDT (Excl OI)	29.300
Other Income	17.000
Operating Profit	46.300
Interest	18.700
Exceptional Items	0.000
PBDT	27.600
Depreciation	16.800
Profit Before Tax	10.800
Tax	3.600
Provisions and contingencies	0.000
Profit After Tax	7.200
Extraordinary Items	0.000
Prior Period Expenses	0.000
Other Adjustments	0.000
Net Profit	7.200

KEY RATIOS

PARTICULARS		31.03.2012	31.03.2011	31.03.2010
PAT / Total Income	(%)	1.77	7.37	9.46
Net Profit Margin (PBT/Sales)	(%)	2.57	10.95	14.49
Return on Total Assets (PBT/Total Assets}	(%)	2.69	11.55	14.70
Return on Investment (ROI) (PBT/Networth)		0.04	0.18	0.23
Debt Equity Ratio (Total Liability/Networth)		0.56	0.63	0.63
Current Ratio (Current Asset/Current Liability)		2.72	3.04	3.04

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	No
Designation of contact person	No
Turnover of firm for last three years	Yes
Profitability for last three years	Yes
Reasons for variation <> 20%	-
Estimation for coming financial year	No
Capital the business	Yes
Details of sister concerns	Yes
Major Suppliers	No
Major Customers	No
Payment Terms	No
Export / Import Details [If Applicable]	No
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

REVIEW OF OPERATIONS

For the year ended 31st March, 2012, the Company has reported standalone revenue and net profit after taxation of Rs. 5188.129 Millions and Rs. 91.830 Millions respectively. As compared to previous year’s revenue it has reduced by 4.60 % and net profit after taxation has reduced by 77.10 %.

AWARDS

The Company has received “Best Equipment Supplier” Award from Gujarat Energy Transmission Company Limited (GETCO) for the FOURTH consecutive year. It indicates that they are very much on track with respect to their endeavor to satisfy the stakeholders by providing the timely deliveries and prompt after sales service in growing and profitable environment.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

ECONOMIC OUTLOOK

Currently India’s GDP stands at $ 1.6 Trillion. As of January 2012, the % share of GDP stood at: Services-57%, Manufacturing-28%, Agriculture-15%. For the last 5 years, services sector has clocked growth rate of 10%, which gives ‘floor’ GDP growth rate of 6%. If Industrial growth can be sustained at 8%, it can add incremental 2% GDP growth, taking overall ‘floor’ GDP growth rate to 8%, even if agricultural growth is flat. Unfortunately, cumulative industrial growth for the period April 2011 - February 2012 was 3.5% against 8.1% a year earlier, indicating the economy was far from experiencing an upturn. It was intended to increase the share of industrial pie to create better employment opportunities to a growing mass of young labor force, which should yield demographic dividend to India’s economy. According to Central Statistical Institute, GDP is projected to grow 6.9% for the year 2011-12. Whereas, to some extent, the crisis in Europe and not too encouraging demand recovery in the US have adversely impacted the GDP growth, internal factors had far more damaging impact. Due to a virtual policy paralysis attributed to coalition compulsions by the government, uncontrolled inflation, much higher subsidies over the budget estimates, huge rise in the government spending, much lower sell off receipts, lower net tax revenue etc. had pulled down the growth rate. It is believed the non-inflationary growth rate (maximum rate of growth that the Indian economy can achieve without fanning inflationary pressures) for 2012-13 can be

sustained at 7%.

UNION BUDGET (FY 2012-13)

It appears to be a status quo budget, which bears an average impact on the economy. It has failed to cheer the power sector. This sector, which has been grossly mismanaged during last six decades, does not appear to have a solution in the budget to attain optimum levels of generation, transmission and distribution. Most surprisingly containment of AT and C losses has been missed out. The budget is disappointing for the domestic power equipment manufacturing companies. The much expected increase on import duty for power generation equipments did not come through to provide level playing field. Hopes were also belied as government did not make it mandatory for upcoming UMPPs with domestic fuel linkages to source equipments locally. Perhaps, the finance minister did not want to burden the power generators by increasing import duties, as they are already in a tight spot due to the rising price of fuel and the uncertainties associated with its availability. The imposition of additional import duty would have been counter productive to the government’s agenda to accelerate capacity addition. Whereas, generation has received some attention, the T and D sector has been largely ignored. Moreover, the hike in excise duty and service tax rates are expected to further adversely impact the top and the bottom lines of electrical equipment manufacturers, and consequently their commercial viability.

SCORE SHEET - XITH PLAN (2007-12)

The XIth five year plan perhaps the most influential phase in India’s power sector ended on 31st March, 2012. When one reflects on the sector’s performance in these five years, one is inspired, though not sufficiently enough, to give due credit. When compared with the Xth five year plan (2002-07), the performance in the XIth plan period has much to cheer about. The Xth plan can best be described as a phase where power sector was groping in the dark with targets in hand, but hardly any means to realise it. In terms of new generation capacity, the Xth plan saw a meager 21,180 mw getting added. This was a far cry even from the repeated downwardly revised target. Also, the plan lacked vision in terms of other aspects, such as, reforms/regulations etc.

In contrast, XIth plan has been a rejuvenating episode. The country could add 54,000 mw with a significant contribution from the private sector. In FY 2012 alone, as much as 19,459 mw was added that is close to the achievement of the entire Xth plan. Power producers both government and private most certainly deserve some kudos.

XIITH PLAN (2012-17) AN OVERVIEW

1. Generation Target : 75,785 mw from conventional power, 18,500 mw from renewable and 13,000 mw from captives.

2. Transmission Target : 109,440 Ckt km of line length and 270,000 MVA of substation capacity. 27,000 Ckt km lines will be at 765 kV voltage level. Hvdc capacity is planned to increase to 26,500 mw from 13,500 mw. The interregional transfer capacity addition target is 37,800 mw, which would take the total transfer capacity to 63,450 mw.

3. Distribution Target : 1.73 Million Ckt km of new lines at 33 kV lower voltages; 5900 new substations at 33 kV and 11 kV levels with transformation capacity of 118,000 MVA.

4. Energy Efficiency Target : 60.17 Billion units, which translates into an avoided capacity addition of 12,350 mw.

5. Fund Requirements : Rs. 13,726 billion, 33% higher than the previous plan period’s original outlay. Overall shortfall in funds is estimated at Rs. 2,017 billion.

SEEING THROUGH THE PLANS

In the XIIth plan, while the primary focus would still be on new generation capacity-the foundation of the power chain-there are several other areas that are crying for attention. Power T and D will need a serious look. While power transmission is still manageable the distribution sector is in complete morass. The sinking financial health of the power distribution utilities is a matter of serious concern. The collective losses are estimated at a colossal Rs. 1 trillion. A complete overhaul of the distribution sector, or at least an inspiring start is more warranted in the XIIth plan. Strong political will is needed to pursue privatization of distribution circles, wherever feasible. Only growing privatization can bring about financial stability to the power sector. Fuel security for thermal power plants will also be critical. The sharp rises in the cost of imported coal puts enough responsibility on the coal ministry/coal India to increase the mining rate, and on the railways to carry the desired volumes to power plants, and thus to ensure sufficient stocks for uninterrupted generation. The recent presidential decree, almost coercing India’s national coal company is a poor example of government coordination in such critical issues. To sum up, for the power sector, it is not just about seeing through the five year plans, it is more about seeing the plans through.

ELECTRICAL EQUIPMENT INDUSTRY- KEY ISSUES/CHALLENGES

1. Poor Capacity Utilization: During 2011, the estimated utilisation of domestic capacity stood as follows: HT Switchgear - 66%, Power Cables - 47%, Capacitors - 84%, Power Transformers - 75%, Transmission Line Towers - 67%, Conductors - 68% (Source - IEEMA).

2. Imports and Exports : Imports - Rs. 217640.000 Millions, Exports - Rs. 138400.000 Millions (Source-IEEMA)

3. Growth in Industry Size : The Industry has grown from Rs. 389200.000 Millions in FY 2007 to Rs. 60,1050.000 Millions (Source-IEEMA). To sustain not just growth, but healthy growth consistent with operational viability, the industry needs level playing field through policy interventions, abolition/ modification of archaic procurement policies of the state electricity boards, availability of key inputs at internationally competitive prices, timely payments, cut in interest rates. It will also be important for the boards to try and even out their procurements to avoid lean phass to the extent feasible.

4. Demand : The encouraging addition of generation capacity during the XIth plan must finally reflect in escalated demands so as to utilize huge capacities that have been created by the industry based on power sector promises made by the government over the Xth and XIth plans. Only increased demands can result in better realisation to sustain viability.

MAJOR DEVELOPMENTS IN HUMAN RESOURCES /INDUSTRIAL RELATIONS FRONT

Human Resources Management has came at center stage of their business strategies. Linking with the strategic goal and objectives, HR functions focus on organizational development and Interventions that foster innovation and flexibility. They continue to assess and improve their internal systems and processes to meet their ongoing objectives of attracting, retaining and motivating talented staff, developing and enhancing employees’ skill sets, and monitoring costs associated with running programs that contribute to their success.

STANDALONE BASIS

Total income of the Company has stepped down from Rs. 5439.401 Millions in FY 2011 to Rs. 5188.129 in FY 2012, thus there is a decrease of 4.62% in the total income of the Company. Due to increase in Raw Material and other costs, Profit before taxation has decreased from Rs. 588.295 Millions during FY 2011 to Rs. 131.828 Millions during FY 2012. Profit after tax for FY 2012 stood at Rs. 91.830 Millions compared to Rs. 401.104 Millions during FY 2011

CONTINGENT LIABILITIES IN RESPECT OF

Particulars	31.03.2012 Rs. In Millions	31.03.2011 Rs. In Millions
a) Disputed demand of Central Excise Department/ Income Tax Department	30.561	41.708
b) Guarantee given by bankers on behalf of Company	2729.743	2107.842
c) Corporate Guarantee of Rs. 288.900 Millions given by Company for loan taken by a subsidiary company	122.470	115.620
d) Performance Guarantees given by Company	3.147	3.347
e) Bills Discounted with Banks	226.439	329.635
f) Import duty benefit towards duty free import of raw materials made in respect of which report obligations are yet to be discharged	0.349	1.612
g) Claims against company not acknowledged ad debts	Amount not ascertained.	Amount not ascertained.

FIXED ASSETS:

• Goodwill
• Land
• Building
• Plant and Machinery
• Electrification
• Furniture and Fixture
• Office Equipments
• Computer and Accessories
• Computer Software
• Vehicles

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 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.53.72
UK Pound	1	Rs.86.14
Euro	1	Rs.70.17

INFORMATION DETAILS

Report Prepared by :

BYI

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	6
--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	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		57

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.