MIRA INFORM REPORT

Report Date :

12.04.2013

IDENTIFICATION DETAILS

Name :	FOURESS ENGINEERING (INDIA) LIMITED
Formerly Known As :	FOURESS ENGINEERING (INDIA) PRIVATE LIMITED
Registered Office :	Mahalaxmi Chambers, 8^th Floor, 22, Bhulabhai Desai Road, Mumbai – 400026, Maharashtra
Country :	India
Financials (as on) :	31.03.2012
Date of Incorporation :	25.06.1971
Com. Reg. No.:	11-015196
Capital Investment / Paid-up Capital :	Rs. 75.000 Millions
CIN No.: [Company Identification No.]	U74210MH1971PLC015196
TAN No.: [Tax Deduction & Collection Account No.]	MUMF00095E
PAN No.: [Permanent Account No.]	AAACF5897K
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturer and Exporter of Industrial Valve.
No. of Employees :	1500 (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 1090000
Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject is an established company having satisfactory track record. There appears some dip in the profitability of the company during the current year. However, networth appears to be satisfactory. 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 condition.

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

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	FITCH
Rating	BBB+ (Long Term Rating)
Rating Explanation	Indicate that expectation of default risk are currently low. The capacity for payment of financial commitment is considered adequate but adverse business or economic condition are more likely to impair this capacity
Date	October 2011

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 PARTED BY

Name :	Mr. Ravi
Designation :	Finance Office
Contact No.:	91-22-24964400
Date :	05.04.2013

LOCATIONS

Registered / Chairman Office :	Mahalaxmi Chambers, 8^th Floor, 22, Bhulabhai Desai Road, Mumbai – 400026, Maharashtra, India
Tel. No.:	91-22-24964400-05/ 06/ 23534400-05
Fax No.:	91-22-23517544/ 24937544
E-Mail :	imp@fouressindia.com svs@fouressindia.com hq@fouressindia.com
Website:	http://www.fouressengg.com http://www.fouressindia.com
Area :	4800 Sq. fts.
Location :	Owned
Factory 1 :	Plot No. A-324, Road No. 21, Wagle Industrial Estate, Thane - 400604, Maharashtra, India
Tel. No.:	91-22-25823755/ 25823602/ 25814613
Fax No.:	91-22-25823603
E-Mail :	byp@fouressindia.com
Area :	4 acres land and plant area 48000 Sq. fts
Location:	Owned
Factory 2 :	Peenya Industrial Estate, Plot No. 2, Phase II, Bangalore - 560058, Karnataka, India
Tel. No.:	91-80-28395734-8
Fax No.:	91-80-28395175-6
E-Mail :	info@fouressindia.com
Area :	4 acres land and plant area 48000 Sq. fts
Location:	Owned
Factory 3 :	C-2, MIDC Industrial Estate, Paithan, Aurangabad – 431148, Maharashtra, India
Tel. No.:	91-2431-232074/ 232376
Fax No.:	91-2431-232058
E-Mail :	ssk@fouressindia.com
Area :	4 acres land and plant area 48000 Sq. fts
Location:	Owned
Branch Office :	Located at Ø Mumbai Ø Baroda Ø Pune Ø Chennai Ø Hyderabad Ø Kolkata Ø Delhi Ø Bhubaneswar
Overseas Office :	14252 Culver Dr, Suite A-207, Irvine CA 92604, USA
Tel. No.:	1- 9499813981
E-Mail :	raous@fouressindia.com
City Office:	13, Sameer Apartment, Ahimsa Nagar, Opposite Akashwani, Aurangabad - 431005, India
Tell No.:	91-2431-232191/ 232191/ 232191/ 232376/ 232075/ 233385
Fax No.:	91-2431-232058
Regional Representatives :	Located at Ø Nagpur Ø Vizag

DIRECTORS

AS ON 30.09.2010

Name :	Mr. Sameer Sadanand Shetty
Designation :	Chairman cum Managing Director
Address :	11-D, IL Palazzo, Little Gibbs Road, Malabar Hill, Mumbai – 400006, Maharashtra, India
Date of Birth/Age :	24.06.1970
Qualification :	B.A (Physics), M.S (Operation and Research)
Date of Appointment :	26.10.1998
PAN No.:	AAIPS2479M
DIN No.:	01306426
Name :	Mrs. Smita Hari Prasad Shetty
Designation :	Managing director
Address :	777, 100 Feet Road, Hal II Stage, Indira Nagar, Bangalore – 560008, Karnataka, India
Date of Birth/Age :	01.12.1956
Qualification :	B.A
Date of Appointment :	26.10.1998
PAN No.:	AAEPS3694N
DIN No.:	01872542
Name :	Mrs. Sucharita Ramcrishna Hegde
Designation :	Director
Address :	4^th Floor, Suraiya Apartments, Pochkhanwala Road, Worli, Mumbai – 400025, Maharashtra, India
Date of Birth/Age :	16.09.1958
Qualification :	M.M.A (Finance)
Date of Appointment :	12.09.1998
PAN No.:	AAAPH4233L
DIN No.:	01284570
Name :	Farrokh Sorab Broacha
Designation :	Director
Address :	Skylark, 4^th Floor, Little Gibbs Road, Malabar Hill, Mumbai – 400006, Maharashtra, India
Date of Birth/Age :	14.06.1938
Date of Appointment :	30.03.1989
DIN No.:	00198990

KEY EXECUTIVES

Name :	Mr. Ravi
Designation :	Finance Office
Name :	Mr. Subhash Vithal Satam
Designation :	Secretary
Address :	B 05, Sohini Apartments, Datta Mandir Road, Vakola, Santacruz (East), Mumbai – 400055, Maharashtra, India
Date of Birth/Age :	24.04.1957
Date of Appointment :	07.06.1982
PAN No.:	ABBPS3043B

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 30.09.2010

Names of Shareholders	No. of Shares
Soumyalatha S. Shetty	393900
Smita H. Shetty	88392
Sucharita R. Hegde	88392
Sameer S. Shetty	129132
Shreeram H. Shetty	18780
Priyadarshini H. Shetty	6300
Rithvik R. Hegde	18780
Tanushree R. Hegde	6300
Fouress Marketing ITL Private Limited, India	24
Total	750000

AS ON 30.09.2010

Equity Share Breakup	Percentage of Holding
Category
Directors or relatives of directors	100.00
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer and Exporter of Industrial Valve.

Products :

ITC Code	Product Descriptions
84800000	Industrial Valve

Exports :

Products :

Industrial Valve

Countries :

Ø Europe

Ø Asian Country

Ø Middle East

Imports :

Products :

Raw Materials

Countries :

Ø Israel

Ø China

Ø Korea

Terms :

Selling :

Cash and Credit

Purchasing :

Cash and Credit

GENERAL INFORMATION

Customers :

End Users

Ø Adani

Ø BHEL

Ø Bharat Petroleum

Ø CGPL -10

Ø EIL

Ø ESSAR

Ø Gammon

Ø HP

Ø Indian Oil

Ø Jindal Steel and Power Limited

Ø NTPC

Ø Reliance Industries Limited

Ø TATA Steel

Ø JSW

No. of Employees :

1500 (Approximately)

Bankers :

Ø State Bank of India, Industrial Finance Branch, The Arcade 2^nd Floor, World Trade Centre, Cuffe Parade, Mumbai – 400005, Maharashtra, India

Ø Corporation Bank

Ø Bank of Baroda

Ø HDFC Bank Limited

Ø ICICI Bank Limited

Ø State Bank of Hyderabad

Ø State Bank of Mysore

Ø State Bank of Travancore

Ø Kotak Mahindra Bank Limited

Facilities :

Working Capital : Rs. 110.000 Millions (From State Bank of India)

Secured Loans	31.03.2012	31.03.2011
	(Rs. In Millions)
Term loans from banks	55.109	10.101
Deferred payment liabilities	5.873	2.448
Loans repayable on demand from banks	85.037	87.069
Total	146.019	99.618

Banking Relations :	--
Auditors :
Name :	J.R. Jain and Company Chartered Accountants
Address :	Sheel Chambers, 10 Cawasji Patel Street Fort, Mumbai, Maharashtra, India
Income-tax PAN of auditor or auditor's firm :	AAAPJ8951D
Related Parties :	Ø Boving Fouress Limited Ø Bombay Engineering Industries
Enterprises which are owned, or have significant influence of or are partners with Key management personnel and their relatives :	Ø B Fouress Private Limited Ø Sadanand Family Benefit Trust Ø Fouress Marketing (International) Private Limited Ø Petrochemical Engineering Enterprises Ø Rubber Products Limited

CAPITAL STRUCTURE

AS ON 31.03.2012

Authorised Capital :

No. of Shares	Type	Value	Amount
1,000,000	Equity Shares	Rs. 100/- each	Rs. 100.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
750,000	Equity Shares	Rs. 100/- each	Rs. 75.000 Millions

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		75.000	75.000	75.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		197.512	170.270	89.656
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		272.512	245.270	164.656
LOAN FUNDS
1] Secured Loans		146.019	99.618	134.258
2] Unsecured Loans		23.033	9.009	9.009
TOTAL BORROWING		169.052	108.627	143.267
DEFERRED TAX LIABILITIES		7.826	8.037	8.312
TOTAL		449.390	361.934	316.235
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		214.128	130.885	132.208
Capital work-in-progress		11.465	16.167	7.741
INVESTMENT		7.149	17.555	0.189
DEFERRED TAX ASSETS		2.027	0.547	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	463.015	364.537	321.657
	Sundry Debtors	433.907	354.281	260.099
	Cash & Bank Balances	32.918	11.312	29.263
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	93.795	85.594	202.885
Total Current Assets		1023.635	815.724	813.904
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	435.459	335.224	296.163
	Other Current Liabilities	350.977	236.450	200.769
	Provisions	22.578	47.270	145.648
Total Current Liabilities		809.014	618.944	642.580
Net Current Assets		214.621	196.780	171.324
MISCELLANEOUS EXPENSES		0.000	0.000	4.773
TOTAL		449.390	361.934	316.235

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2012	31.03.2011	31.03.2010
	SALES
		Revenue from operations	1679.261	1531.590	1372.213
		Other Income	15.771	13.141	31.728
		TOTAL	1695.032	1544.731	1403.941
Less	EXPENSES
		Cost of materials consumed	1110.675	924.249
		Changes in inventories of finished goods, work-in-progress and stock-in-trade	(65.213)	(19.981)
		Employee benefit expense	248.033	219.274
		Other expenses	316.091	269.536
		TOTAL	1609.586	1393.078	1284.396
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION		85.446	151.653	119.545
Less	FINANCIAL EXPENSES		23.860	21.388	24.427
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION		61.586	130.265	95.118
Less/ Add	DEPRECIATION/ AMORTISATION		23.061	19.312	18.388
	EXCEPTIONAL ITEMS BEFORE TAX		(1.274)	(1.274)	0.000
	PROFIT BEFORE TAX		37.251	109.679	76.730
Less	TAX		10.009	29.064	37.100
	PROFIT AFTER TAX		27.242	80.615	39.630
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	73.221	368.524	281.665
	IMPORTS
		Raw Materials			83.499
		Spares and Consumables			4.610
	TOTAL IMPORTS		0.000	0.000	88.109
	Earnings Per Share (Rs.)		36.32	107.48	52.84

Expected Sales (2012-2013): Rs. 1850.000 Millions

The above information has been parted by Mr. Ravi (Finance Office)

KEY RATIOS

PARTICULARS		31.03.2012	31.03.2011	31.03.2010
PAT / Total Income	(%)	1.61	5.22	2.82
Net Profit Margin (PBT/Sales)	(%)	2.22	7.16	5.59
Return on Total Assets (PBT/Total Assets}	(%)	3.01	11.59	8.04
Return on Investment (ROI) (PBT/Networth)		0.14	0.45	0.47
Debt Equity Ratio (Total Debt/Networth)		0.62	0.44	0.87
Current Ratio (Current Asset/Current Liability)		1.27	1.32	1.27

LOCAL AGENCY FURTHER INFORMATION

SUNDRY CREDITORS DETAILS:

Particulars	31.03.2012	31.03.2011	31.03.2010
	(Rs. In Millions)
Sundry Creditors
Other	435.459	335.224	296.163

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	Yes
5]	Type of Business	Yes
6]	Line of Business	Yes
7]	Promoter's background	Yes
8]	No. of employees	Yes
9]	Name of person contacted	Yes
10]	Designation of contact person	Yes
11]	Turnover of firm for last three years	Yes
12]	Profitability for last three years	Yes
13]	Reasons for variation <> 20%	--
14]	Estimation for coming financial year	Yes
15]	Capital in the business	Yes
16]	Details of sister concerns	Yes
17]	Major suppliers	No
18]	Major customers	Yes
19]	Payments terms	Yes
20]	Export / Import details (if applicable)	Yes
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	No
34]	External Agency Rating, if available	Yes

UNSECURED LOANS

Unsecured Loans	31.03.2012	31.03.2011
	(Rs. In Millions)
Other loans and advances	2.379	2.379
Loans repayable on demand from banks	7.254	0.000
Loans and advances from related parties	13.400	6.630
Total	23.033	9.009

OPERATIONS

The Company’s Sales turnover showed an increase of 9.65% over the previous year i.e. from of Rs. 1531.600 Millions to Rs.1679.300 Millions in the current year.

There was an overall improvement in the performance of all the plants. The order book position continued to be good especially from Water, Gas and Power sectors.

The increase in the cost of steel and other raw material affected the Company’s profitability and inspite of the growth in the sales the net profit came down.

PROSPECTS

With the signs of revival in the domestic economy the Company expects to continue its growth in the coming years also. The pending order position as on 31.07.2012 was more than Rs.2200.000 Millions which can be considered healthy. The Company is confident of executing all these orders as per the need dates of the customers and expects to continue doing well during the current year.

FIXED ASSETS:

Ø Land

Ø Residential building

Ø Factory building

Ø Plant and equipment

Ø Factory equipments

Ø Furniture and fixtures

Ø Vehicles

Ø Motor vehicles

Ø Office equipment

Ø Other equipments

Ø Computer equipments

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. 54.53
UK Pound	1	Rs. 83.60
Euro	1	Rs. 71.33

INFORMATION DETAILS

Information Gathered by :	SVA
Report Prepared by :	BVA

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	6
--PROFITABILIRY	1~10	4
--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	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTERS
--RBI	YES/NO	NO
--EPF	YES/NO	NO
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.