MIRA INFORM REPORT

Report Date :

22.08.2013

IDENTIFICATION DETAILS

Name :	CARBORUNDUM UNIVERSAL LIMITED
Registered Office :	Parry House, 43 Moore Street, Chennai – 600001, Tamilnadu
Country :	India
Financials (as on) :	31.03.2013
Date of Incorporation :	21.04.1954
Com. Reg. No.:	18-000318
Capital Investment / Paid-up Capital :	Rs.187.470 Millions
CIN No.: [Company Identification No.]	L29224TN1954PLC000318
TAN No.: [Tax Deduction & Collection Account No.]	CHEC00173F
PAN No.: [Permanent Account No.]	AAACC2474P
Legal Form :	A Public Limited Liability company. The company’s Shares are Listed on the Stock Exchanges.
Line of Business :	Manufacturer and seller of mainly Abrasives, ceramics (industrial ceramics, refractories) and Electrominerals.
No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

A (65)

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 27300000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established and a reputed company having fine track record. Financial position of the company appears to be sound. Trade relations are reported as fair. Business is active. Payments are reported to be regular and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

NOTES :

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

ECGC Country Risk Classification List – March 31^st, 2013

Country Name	Previous Rating (31.12.2012)	Current Rating (31.03.2013)
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

We are living in a world where volatility and uncertainty have become the New Normal. We saw a change of government in countries like Tunisia, Egypt, Libya and Vietnam. Once powerful countries in Europe are now fighting for bankruptcy. We have taken growth in the developing part of the world for granted but economic growth in China and India has begun to slow. Companies that were synonymous with their product categories just a few years ago are now no longer in existence. Kodak, the inventor of the digital camera had to wind up its operations, HMV, the British entertainment retailing company and Borders, once the second largest bookstore have shut down due to their inability to evolve their business models with the changing time. Readers’ Digest, Thomson Register are no more !

There is another megatrend happening. The World order is changing as economic power shifts from West to East. According to McKinsey study, it took Britain more than 100 years to double its economic output per person during its industrial revolution and the US later took more than 50 years to do the same. More than a century later, China and India have doubled their GDP per capital in 12 and 18 years respectively. By 2020, emerging Asia will become the world’s largest consuming block, overtaking North America.

The years after the outbreak of the global financial crisis, the world economy continues to remain fragile. The Indian economy demonstrated remarkable resilience in the initial years of the contagion but finally lost ground last year. GDP growth slowed down. Currency has been weakening. There is a marked deceleration in agriculture, industry and services. Dampening sentiment led to a cut-back in investment as well as private consumption expenditure.  Inflation remained at high levels fuelled by the pressure from the food and fuel sectors. The large fiscal and current account deficit s continued to cause grave concern. It is imperative that India regains its growth trajectory of 8-9 % sooner than later. This is crucially important given the need to create gainful livelihood opportunities for the millions living in poverty as also the large contingent of young people joining the job market every year.

EXTERNAL AGENCY RATING

Rating Agency Name	CRISIL
Rating	AA+ (Long Term Rating)
Rating Explanation	High degree of safety and very low credit risk.
Date	January 08, 2013

Rating Agency Name	CRISIL
Rating	A1+ (Short Term Rating)
Rating Explanation	Very strong degree of safety and lowest credit risk.
Date	January 08, 2013

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

Management Non Co-Operative (91-44-25306789)

LOCATIONS

Registered Office :	Parry House, 43 Moore Street, Chennai - 600001, Tamilnadu, India
Tel. No.:	91-44-25211652/ 25306789/ 42216789/ 30006199
Fax No.:	91-44-25230706/ 42216149
E-Mail :	mmm@cumiho.rpgms.ems.vsnl.net.in cumiho@giasmd01.vsnl.net.in cumigeneral@ho.cumi.co.in dhanvanthkumarS@cumi.murugappa.com cumigeneral@cumi.murugppa.com investorservices@cumi.murugappa.com
Website :	http://www.cumi.co.in http://www.cumi-murugappa.com
Plant :	a) 655, Thiruvottiyur High Road, P B No.2272, Tiruvottiyur, Chennai – 600019, Tamilnadu, India b) Plot No.48, SIPCOT Industrial Complex, Hosur - 635126, Dharmapuri District, Tamilnadu, India c) Gopalpur Chandigarh, P.O. Ganga Nagar, Kolkata - 700132, West Bengal, India d) C-4 and C-5, Kamarajar Salai, MMDA Industrial Complex, Maraimalai Nagar Kancheepuram District - 603209, Tamilnadu, India e) F-1/2, F2 - F5, SIPCOT Industrial Park, Pondur “A” Village, Sriperumbudur - 602105. Kanchipuram District, Tamilnadu, India f) K3, ASAHI Industrial Estate, Latherdeva Hoon, Mangalore Jhabrera Road, PO Jhabrera Tehsil Roorkee, Hardwar District – 247667, Uttarkhand, India g) Plot No.77, Bommasandra, Jigani Link Road, Jigani Industrial Area, Jigani, Bengaluru - 526106, Karnataka, India h) PB No.1 Kalamassery, Development Plot P.O, Kalamassery, Ernakulam District - 683109, Kerala, India i) PB No. 3 Nalukettu, Koratty, Trichur District - 680308, Kerala, India j) Bhatia Mines, Bhatia Western Railway, Jamnagar District - 361315, Gujarat, India k) P.B No.2 Okha Port P.O., Jamnagar District - 361350, Gujarat, India l) Plot No.7 and 18, Cochin Special Economic Zone (CSEZ), Kakkanad, Kochi 682037, Kerala, India m) Maniyar Hydroelectric Works, Maniyar P.O. Vadasserikara, Pathanamthitta District - 689662, Kerala, India n) Plot No.47, SIPCOT Industrial Complex, Hosur, Dharmapuri District - 635126, Tamilnadu, India o) Super Refractories Division, Plot No.102 and 103, SIPCOT Industrial Complex (Phase II), Ranipet - 632403, Tamilnadu, India p) Super Refractories Division – Plant 2, Serkaddu Village, Vinnampalli Post, Katpadi Taluk, Vellore District – 632516, Tamilnadu, India q) Plot Nos. 35, 37, 48-51, Adhartal Industrial Estate, Jabalpur - 482004, Madhya Pradesh, India

DIRECTORS

As on: 31.03.2013

Name :	Mr. M.M. Murugappan
Designation :	Chairman
Date of Birth/Age :	57 Years
Name :	Mr. Subodh Kumar Bhargava
Designation :	Non-Executive Director
Date of Birth/Age :	71 Years
Name :	Mr. T.L. Palani Kumar
Designation :	Non-Executive Director
Date of Birth/Age :	63 Years
Name :	Mr. Sridhar Ganesh
Designation :	Non-Executive Director
Date of Birth/Age :	62 Years
Name :	Mr. Shobhan M. Thakore
Designation :	Non-Executive Director
Date of Birth/Age :	65 Years
Name :	Mr. M. Lakshminarayan
Designation :	Non-Executive Director
Date of Birth/Age :	66 Years
Name :	Mr. Sanjay Jayavarthanavelu
Designation :	Non-Executive Director
Date of Birth/Age :	44 Years
Name :	Mr. K Srinivasan
Designation :	Managing Director
Date of Birth/Age :	55 Years
MANAGEMENT COMMITTEE:
Name :	Mr. K. Srinivasan
Designation :	Managing Director
Name :	Mr. V. Ramesh
Designation :	President - Abrasives
Name :	Mr. P. L. Deepak Dorairaj
Designation :	Senior Vice President-International Business and Exports-Abrasives
Name :	Mr. Rajesh Khanna
Designation :	Senior Vice President - Ceramics
Name :	Mr. N Ananthaseshan
Designation :	Senior Vice President - Electro Minerals Division
Name :	Mr. R Rajagopalan
Designation :	Senior Vice President - Refractories and Prodorite
Name :	Mr. M Muthiah
Designation :	Senior Vice President - Human Resources
Name :	Mr. Sridharan Rangarajan
Designation :	Chief Financial Officer
Name :	Mr. S Dhanvanth Kumar
Designation :	Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on: 30.06.2013

Category of Shareholders	No. of Shares	Percentage
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	11929256	6.36
Bodies Corporate	67241364	35.86
Sub Total	79170620	42.23
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	79170620	42.23
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	11248329	6.00
Financial Institutions / Banks	40713	0.02
Insurance Companies	9227976	4.92
Foreign Institutional Investors	42617422	22.73
Sub Total	63134440	33.67
(2) Non-Institutions
Bodies Corporate	6621236	3.53
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 Million	26561829	14.17
Individual shareholders holding nominal share capital in excess of Rs. 0.100 Million	11020046	5.88
Any Others (Specify)	981319	0.52
Clearing Members	12749	0.01
Trusts	8261	0.00
Non Resident Indians	960309	0.51
Sub Total	45184430	24.10
Total Public shareholding (B)	108318870	57.77
Total (A)+(B)	187489490	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	0	0.00
(1) Promoter and Promoter Group	0	0.00
(2) Public	0	0.00
Sub Total	0	0.00
Total (A)+(B)+(C)	187489490	0.00

BUSINESS DETAILS

Line of Business :

Manufacturer and seller of mainly Abrasives, ceramics (industrial ceramics, refractories) and Electrominerals.

Products :

ITC Code	Product Description
680422.01 and 68.05	Abrasives-Bonded and Coated
28.18 and 28.49	Electrominerals
69.06 and 690600	Industrial Ceramics

PRODUCTION STATUS (AS ON 31.03.2010)

Particulars	Unit	Installed Capacity	Actual Production
Abrasives
Bonded	Tonne	19640	15328
Coated	In million sqm	17.86	9.04
Industrial Cloth	Metre	4500000	2451886
Ceramics
Industrial Ceramics	Tonne	5870	3598
Refractories	Tonne	36450	26057
Electrominerals
Grains	Tonne	25340	22706

GENERAL INFORMATION

No. of Employees :

Not Available

Bankers :

· State Bank of India

· Standard Chartered Bank

· Bank of America

· The Hongkong and Shanghai Banking Corporation Limited

· Royal Bank of Scotland

· BNP Paribas

Facilities :

(Rs. In Millions)

Secured Loan	As on 31.03.2013	As on 31.03.2012
LONG-TERM BORROWINGS
(a) Debentures
11.70% Secured Non-Convertible Redeemable debentures
500 debentures of Rs.1 million each issued for cash at par redeemable in 2 equal annual installments, second installment payable on 1st January 2014. (Secured by a pari-passu first charge on movable fixed assets of the Company, both present and future, and also a pari-passu first charge on the immovable properties, both present and future, relating to various manufacturing locations)	0.000	250.000
(b) Term Loan from banks
External commercial borrowings (ECB) Secured by a pari-passu first charge on movable fixed assets, both present and future	0.000	291.610
(c) Long term maturities of Finance lease obligations (Secured against assets purchased under the arrangement)	11.820	16.870
SHORT-TERM BORROWINGS
From Banks
Cash Credit (repayable on demand)	22.110	0.670
Other Borrowings (Secured by a pari-passu first charge on the current assets of the Company, both present and future and a pari-passu second charge on immovable properties, both present and future, relating to various manufacturing locations)	565.310	311.170
Total	599.240	870.320

Banking Relations :	--
Statutory Auditors :
Name :	Deloitte Haskins and Sells Chartered Accountants
Address :	No:52, ASV N Ramana Towers, Venkatanarayana Road, T Nagar, Chennai – 600017, Tamilnadu, India
Cost Auditors :
Name :	S Mahadevan and Company Chartered Accountants
Address :	No.1 ‘Lakshmi Nivas’, K.V. Colony, Third Street West, Mambalam, Chennai - 600033, Tamilnadu, India
Subsidiaries :	· Net Access India Limited · Southern Energy Development Corporation Limited · Sterling Abrasives Limited · Sterling Abrasives Limited · Cellaris Refractories India Limited · CUMI International Limited
Holding through Subsidiary :	· Volzhsky Abrasives Works · Foskor Zirconia (Pty) Limited · CUMI America Inc · CUMI Middle East FZE · CUMI Canada Inc · CUMI Abrasives and Ceramics Company Limited · Thukela Refractories Isithebe Pty Limited
Joint Ventures :	· Murugappa Morgan Thermal Ceramics Limited · Ciria India Limited · Wendt (India) Limited
Associate :	Laserwords Pvt Limited [Ceased to be an associate w.e.f November 2011]

CAPITAL STRUCTURE

As on: 31.03.2013

Authorised Capital :

No. of Shares	Type	Value	Amount
250000000	Equity Shares	Rs.1/- each	Rs.250.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
187468344	Equity Shares	Rs.1/- each	Rs.187.470 Millions

a) Reconciliation of the shares outstanding at the beginning and at the end of the reporting period

Particulars	As at 31.03.2013
Equity shares with voting rights	No. of Shares	Value of Shares
Number of shares at the beginning of the year	187395562	187.400
Add : Shares issued against ESOP scheme during the year before “Share-split”	–	–
Total number of shares before “Share-split”	187395562	187.400
Number of shares consequent to “Share-split”	–	–
Add : Shares issued against ESOP scheme during the year after “Share-split”	72782	0.070
Total number of shares outstanding at the end of the year	187468344	187.47

b) Terms / Rights attached to Equity Shares

The Company has only one class of Equity shares having a par value of Re.1/- per share (The Company subdivided one equity share of Rs.2/- each into two equity shares of Re.1/- each on 20th September 2011 after obtaining shareholder’s approval).

Each holder of equity shares is entitled to one vote per share.

For the year ended March 31, 2013, Final dividend of Re.0.75 per share has been proposed by the Board of Directors (previous year Re.1 per share). An interim dividend of Re.0.5 per share was declared at the meeting of the Board of Directors held on February 5, 2013 and the same has been paid (previous year Re.1 per share).

The dividends proposed by the Board of Directors is subject to approval of the shareholders in the Annual General Meeting.

Repayment of capital will be in proportion to the number of equity shares held.

c) Details of shares held by shareholders holding more than 5% of the aggregate share in the Company

Name of Shareholder	As at 31.03.2013
	No. of Shares held	% of holding
Murugappa Holdings Limited	55432284	29.57%
Nalanda India Fund Limited	16793362	8.96%
Face value per share	Re.1

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.03.2013	31.03.2012
EQUITY AND LIABILITIES
(1)Shareholders' Funds
(a) Share Capital	187.470	187.400
(b) Reserves & Surplus	6657.940	6178.540
(c) Money received against share warrants	0.000	0.000
(2) Share Application money pending allotment	0.000	0.000
Total Shareholders’ Funds (1) + (2)	6845.410	6365.940
(3) Non-Current Liabilities
(a) long-term borrowings	11.820	558.480
(b) Deferred tax liabilities (Net)	490.320	425.300
(c) Other long term liabilities	0.000	0.000
(d) long-term provisions	0.000	0.000
Total Non-current Liabilities (3)	502.140	983.780
(4) Current Liabilities
(a) Short term borrowings	761.790	409.340
(b) Trade payables	913.890	791.300
(c) Other current liabilities	955.110	1171.660
(d) Short-term provisions	209.810	246.620
Total Current Liabilities (4)	2840.600	2618.920
TOTAL	10188.150	9968.640
ASSETS
(1) Non-current assets
(a) Fixed Assets
(i) Tangible assets	4102.900	3822.350
(ii) Intangible Assets	38.430	30.940
(iii) Capital work-in-progress	144.340	272.540
(iv) Intangible assets under development	0.000	0.000
(b) Non-current Investments	1246.180	1245.680
(c) Deferred tax assets (net)	0.000	0.000
(d) Long-term Loan and Advances	188.950	223.040
(e) Other Non-current assets	0.000	0.0000
Total Non-Current Assets	5720.800	5594.550
(2) Current assets
(a) Current investments	0.000	100.000
(b) Inventories	1799.570	1876.880
(c) Trade receivables	2023.650	1847.160
(d) Cash and cash equivalents	88.720	104.230
(e) Short-term loans and advances	555.410	445.820
(f) Other current assets	0.000	0.000
Total Current Assets	4467.350	4374.090
TOTAL	10188.150	9968.640

SOURCES OF FUNDS		31.03.2011
SHAREHOLDERS FUNDS
1] Share Capital		186.940
2] Share Application Money		0.000
3] Reserves & Surplus		5095.300
4] (Accumulated Losses)		0.000
NETWORTH		5282.240
LOAN FUNDS
1] Secured Loans		2184.560
2] Unsecured Loans		88.840
TOTAL BORROWING		2273.400
Long Term Lease Liability		14.250
DEFERRED TAX LIABILITIES		420.580
TOTAL		7990.470
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		3732.120
Capital work-in-progress		153.240
INVESTMENT		1640.560
DEFERREX TAX ASSETS		0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	1548.040
	Sundry Debtors	1772.180
	Cash & Bank Balances	78.160
	Other Current Assets	0.000
	Loans & Advances	508.930
Total Current Assets		3907.310
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	934.400
	Other Current Liabilities	405.060
	Provisions	103.300
Total Current Liabilities		1442.760
Net Current Assets		2464.550
MISCELLANEOUS EXPENSES		0.000
TOTAL		7990.470

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2013	31.03.2012	31.03.2011
	SALES
		Income	11008.920	11253.730	9125.660
		Other Income	183.150	154.880	71.490
		Income from Work Bills and Services	0.000	0.000	337.360
		TOTAL (A)	11192.070	11408.610	9534.510
Less	EXPENSES
		Cost of materials consumed	4171.120	4283.010
		Purchases of stock-in-trade	651.820	462.540
		Changes in inventories of finished goods, work-in-process and stock-in-trade	(9.900)	(165.380)
		Employee benefits expense	1121.990	1076.000
		Other expenses	3545.530	3398.660
		Transfer from Fixed assets revaluation reserve	(0.680)	(0.680)
		Profit on sale of Land and Buildings	0.000	(10.570)
		Profit on sale of Long term Investments (net)	0.000	(139.310)
		TOTAL (B)	9479.880	8904.270	7287.890
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		1712.190	2504.340	2246.620
Less	FINANCIAL EXPENSES (D)		163.750	174.200	203.380
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		1548.440	2330.140	2043.240
Less/ Add	DEPRECIATION/ AMORTISATION (F)		468.090	436.210	399.880
	PROFIT BEFORE TAX (E-F) (G)		1080.350	1893.930	1643.360
Less	TAX (H)		335.020	427.220	400.780
	PROFIT AFTER TAX (G-H) (I)		745.330	1466.710	1242.580
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		1850.260	1841.170	1640.260
Less	APPROPRIATIONS
		Transfer to General Reserve	250.000	1000.000	750.000
		Tax on Debenture Redemption Reserve	0.000	31.250	31.250
		Dividend Tax	35.300	51.490	0.00
		Dividend	234.330	374.770	260.450
		Final Dividend (previous year)*	0.020	0.110	0.000
	BALANCE CARRIED TO THE B/S		2075.940	1850.260	1841.170
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	2201.430	2414.030	1941.800
		Royalty	4.540	3.890	2.510
		Dividend and Interest	57.610	24.890	30.080
		Management Fees	16.290	40.870	29.780
	TOTAL EARNINGS		2279.870	2483.680	2004.170
	IMPORTS
		Raw Materials	1838.320	2156.370	1869.920
		Components and Spare Parts	55.130	49.950	19.220
		Capital Goods	150.590	128.150	171.980
	TOTAL IMPORTS		2044.040	2334.470	2061.120
	Earnings Per Share (Rs.)
	Basic		3.98	7.83	13.29
	Diluted		3.97	7.81	--

KEY RATIOS

PARTICULARS		31.03.2013	31.03.2012	31.03.2011
PAT / Total Income	(%)	6.66	12.85	13.03
Net Profit Margin (PBT/Sales)	(%)	9.81	16.83	18.01
Return on Total Assets (PBT/Total Assets}	(%)	12.28	22.41	21.51
Return on Investment (ROI) (PBT/Networth)		0.16	0.30	0.31
Debt Equity Ratio (Total Debt/Networth)		0.11	0.15	0.43
Current Ratio (Current Asset/Current Liability)		1.57	1.67	2.71

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	No
10]	Designation of contact person	No
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	No
33]	Voter ID No of Proprietor/Partner/Director, if available	No
34]	External Agency Rating, if available	Yes

UNSECURED LOAN

(Rs. In Millions)

Particular	As on 31.03.2013	As on 31.03.2012
SHORT-TERM BORROWINGS
Other loans	174.370	97.500
Total	174.370	97.500

ECONOMIC OVERVIEW AND COMPANY PERFORMANCE

ECONOMIC OVERVIEW

As per the reports of the International Monetary Fund, global economic growth decelerated to 3.2 per cent from 3.9 per cent in the previous year. While US economy and Japan showed improvement, the economic slowdown in the Euro area, emerging market and developing economies including China, India, Russia and Latin America in aggregate was significant enough to adversely impact world output. A multiplicity of developments have lead to this, some of them being the rising uncertainty about the viability of the European Economic and Monetary Union, policies in the major advanced economies not resulting in rebound in confidence, pre-crisis legacy issues, including high household debt constraining private consumption and escalation of financial stress in the euro area periphery which started reaching other economies in the region given the trade and financial linkages.

A significant part of the lower growth in emerging market and developing economies was related to domestic factors, notably constraints on the sustainability of the high pace of growth in these economies and building financial imbalances. Diminishing space for further policy easing, supply bottlenecks and policy uncertainty have also hampered growth in certain economies.

As per the Economic Survey of India published by the Government of India in February 2013, the Indian Economy slowed during 2012-13. The growth rate is estimated at 5 per cent as against the 6.2 per cent of the previous year. The moderation in growth is primarily attributable to weakness in industry (comprising the mining, quarrying, manufacturing, electricity and construction sectors).

The rate of growth of the manufacturing sector was even lower at 1.9 per cent. Growth in agriculture has also been weak in 2012-13 following lowerthan-normal rainfall, especially in the initial phases of the south west monsoon. The growth rate of the services sector also declined to 6.6 per cent in 2012-13 from 8.2 per cent in 2011-12.

COMPANY PERFORMANCE

REVENUES

Despite the overall moderation in the economic activity across the globe including India, the Company’s worldwide revenues recorded only a marginal decline from last year’s levels. While revenue from India declined by 6 per cent, that from rest of the world increased by 4 per cent.

The Ceramics business registered a growth of about 9 per cent. This helped to substantially offset the decline in performance of the Abrasives and Electrominerals businesses.

Sluggish infrastructure investments, capex deferrals by industries, lower customer demand for user industries, competition from low price products, power crisis and tight credit position in trade resulted in weakened demand.

On a standalone basis, the operations which started on a subdued note during the first quarter, turned sharply negative during the third quarter. In the 4th quarter, there was a marginal pick up on a sequential basis. The year’s performance must also be viewed in the light of the fact, that in the previous two years, the Company’s sales recorded a cumulative increase of 50 per cent (from Rs.7381 million to Rs.11052 million) which is one of the highest growth rates witnessed in recent times.

MANUFACTURING

Production volumes were moderated to meet the requirements of customers. Cost reduction initiatives were initiated by use of alternate cost effective raw materials, improvement in raw material consumption and process improvements.

Capital expenditure during the year across all geographies was in the nature of capacity additions for certain product segments, automation, quality enhancement, line balancing and general infrastructure.

During the year, the Company’s wholly owned subsidiary, CUMI International Limited, Cyprus acquired a fused minerals and refractory manufacturing Company in Isithebe, South Africa. The Company has been rechristened as Thukela Refractories Isithebe Proprietory Limited, post acquisition. This acquisition has helped to widen the Company’s product portfolio in the refractory and minerals businesses and also enhanced manufacturing capacity.

ABRASIVES

BUSINESS PROFILE

On a consolidated basis, this business comprises the following major product groups viz. bonded abrasives, coated abrasives (including nonwovens), super abrasives and power tools. The operations are carried out through thirteen manufacturing facilities located in India, Russia, China, Canada and Thailand. The marketing entities located in North America and Middle East support this business in getting an extended customer reach. Abrasives are used in a wide spectrum of industries, the key among them being automobile, engineering, fabrication, wood working, construction, home maintenance and infrastructure.

The Company caters to customers located in over fifty countries through its network of manufacturing facilities and marketing establishments. It is one of the major players in India and Russia.

INDUSTRY SCENARIO

The global industry continues to be led by few players who have a complete portfolio of abrasive products. There are also a large number of players specializing in specific categories of abrasives.

The Indian abrasives industry is catered to by a few large players and also numerous smaller players specializing in select products. Imports, particularly from China, enjoy a sizeable portion of the market. Due to the soft market conditions in many advanced economies, India is becoming a focus market for major global players resulting in intense competition.

In the domestic Russian market there are three major players. The Company is a major player in vitrified bonded abrasives. Imports service a sizeable portion of the market.

There was no major change in the industry structure during the year.

SALES OVERVIEW

Due to the subdued sentiments in the user industries and segments, the Abrasives business recorded a marginal decline in revenues on a consolidated basis but maintained turnover at about last year’s levels on a standalone basis. Revenues for the year were Rs.8092 million on a consolidated basis and Rs. 6073 million on a standalone basis.

In India, the recessionary trends which commenced during the first quarter of the year, turned more acute as the year progressed resulting in dampened market sentiment. Consequently off-take from end user segments and trade channels was weak. The products addressing the channel segment was impacted further by the tight credit position. This was further exacerbated by the slow progress of various infrastructure and industrial expansion projects. However the initiatives in the market place for creating brand visibility, market segmentation and enlarged customer reach, helped the business to ensure that there was no major adverse impact on revenues.

In bonded abrasives, sales of both standard products and custom built products remained flat. However off take of coated abrasives and super abrasives recorded good growth as a result of the retail initiatives and a slew of new products. Sale of non woven abrasives products to large institutional customers was firmly established. The facility has reached peak utilization as a result of the strong order inflow. Sales of super abrasive and other products by Wendt India Limited (the Company’s joint venture) declined.

During the year, sales of power tools continued to grow well despite the weak market momentum and the precarious power situation in Tamilnadu. The product basket has been widened. It may be recalled that the Company had towards the end of last year entered into an arrangement with Metabowerke GmbH, Germany, for distribution of premium power tool products. The business focused efforts to put in place the required infrastructure in terms of warehousing, logistics, feet-on-street, building brand visibility and establishing customer connect for this new product category.

In Russia, performance of the abrasives business declined due to the decrease in off-take from the domestic market. The steady decline in mass manufacturing activity has lead to a gradual shrinkage in the abrasives requirement which has lead to tougher competition amongst various market players. Consequently there was a decline in sales volume. The business has however done well to shore up its market share in a shrinking market.

The operations in China, backed by a new management team recorded a growth of 33 per cent. The sales team has been rebuilt and focused efforts have been taken to address the requirements of original equipment suppliers, distributors and supplies to CUMI India.

MANUFACTURING

In India, one of the key initiatives of the year was on exhaustive implementation of the Total Productive Maintenance (TPM) program. Several abrasives facilities in India were brought under the TPM umbrella and the extent of coverage in each plant made good progress. The initiatives undertaken have helped to enhance overall

equipment effectiveness yielding benefits in terms of enhanced on-time delivery. In the Chinese operations, manpower was rationalized and productivity has been increased.

The business witnessed erosion in margins across all geographies in which it operates. Prices of key input materials increased significantly. Efforts were taken to renegotiate prices of inputs with various suppliers. The steep appreciation in US Dollar, which took the industry by surprise since the first quarter, further compounded the underlying raw material cost increases in respect of the Indian operations. The precarious power situation in Tamilnadu, India impacted the operations of this business as a significant part of its manufacturing for India is being done in this State. Consequently operating profits was severely dented as a result of the overall cost push.

During the year, investments were done to increase capacity in certain mass market products and also certain categories of standard industrial products. This will help the business to address the increased market requirements for these products.

As a result of the lower revenues coupled with cost increases, the abrasives business recorded a decline in profit before interest and tax on a consolidated basis and on a standalone basis.

CERAMICS

BUSINESS PROFILE

As a consolidated entity, the ceramics business has three product groups viz. industrial ceramics, super refractories and anti corrosives. Industrial ceramics business offers alumina and zirconia products of technical ceramic grades addressing wear and corrosion protection, electrical insulation, thermal protection and ballistic protection applications. The super refractories product group supplies fired and monolithic super refractories, refractory fibre and also refractory design and installation services addressing the insulation / thermal resistance

requirements of industries. The refractory fibre and refractory design and installation businesses are addressed through Murugappa Morgan Thermal Ceramics Limited and Ciria India Limited. The anti-corrosives product group offers acid resistant cements, polymer concrete cells and various other products addressing the anticorrosion requirements of industries.

The key user industries for ceramics business are power generation and transmission, coal washeries, grain handling, sanitary tiles and sanitary ware, ballistic protection, cement, non ferrous metals, iron and steel industries, carbon black, insulators, furnace building, glass, petrochemical and construction industries.

The operations are carried out through eleven manufacturing facilities located in India, Australia, South Africa and Russia. The subsidiaries in North America, Middle East, China and South Africa also support this business in getting an extended customer reach. CUMI Australia also provides installation cum service facilities.

The Company is one of the major players in India, Australia and Russia in specific product groups. The Company caters to customers located in over thirty countries.

INDUSTRY SCENARIO

There has been no material change in the ceramics industry structure in India, which is catered to by a few major players. CUMI is a highly respected player in certain market segments.

In Australia, CUMI Australia is one of the major players in the lined equipment and industrial ceramic tiles industry. There are about a dozen players in the industry, most of whom market products that are imported from China and USA.

The refractory industry in Russia is a highly fragmented market with several players. The Company is a small player in the industry.

There was no major change in the industry structure during the year.

SALES OVERVIEW

Revenues of the ceramics business grew by 9 per cent, on a consolidated basis primarily driven by the growth in industrial ceramics. Revenues (excluding captive sales) for the year were Rs.4926.000 millions on a consolidated basis and Rs.3224.000 millions on a standalone basis.

In the Indian operations, industrial ceramics recorded good growth primarily driven by the increased sales of ceramic lined equipment and grinding media. Sales of metallised products and engineered ceramics was maintained at about last year’s levels despite the lower off take from customers in the Indian and overseas markets. To counter the effects of the slowdown and as a derisking approach, the business has started work on developing new customers. Over capacity and squeeze in margins aggravated the weak market trend. In Australia, sale of ceramic products increased by 12 per cent despite stiff competition.

Turnover of the refractories business in India declined due to lower off-take of fired products. The order inflow from the projects segment, particularly glass and ceramics industry, dropped sharply. Sales of anticorrosives registered good growth. This helped to partly offset the lower sales in the fired segment. Sales through channel partners helped to supplement the overall selling effort. Sales of refractory fibre by the Company’s joint venture, grew marginally despite the soft market conditions and the cost increases which hurt price competitiveness. The refractory design and installation services business, which is also addressed through a joint venture, recorded lower sales.

In Russia, nitride bonded silicon carbide refractories continued to perform well registering a good growth over the previous year. Given the encouraging response in the market, the manufacturing capacity has been expanded. Sales of refractories of the newly acquired South African subsidiary was lower than plan as the expected order inflow from a key customer did not materialize. However diligent marketing efforts have been undertaken to widen the customer portfolio and also increase the geographical spread of the customer base.

Sales of anti corrosion products also registered strong growth, particularly in the export markets. The efforts to establish new customer relationships and enter into new geographies, which were commenced last year, yielded good results.

MANUFACTURING

The Company has concluded a technology tie up with reputed refractory makers in Europe for manufacture of high end refractory solutions. The tie-up has helped the Company to widen its spectrum of product offerings and also address new end user segments which were hitherto untapped. Investment in capital equipment have been commenced to manufacture these new categories of refractories.

The new line for manufacture of fibre reinforced plastic (FRP) composites which was completed last year performed well and sales of these products has been very encouraging.

Additional investments in various machinery and equipment were made during the year addressing the needs for added capacity, enhancement in product configuration to meet customer expectation, line balancing, improvement in productivity and new products.

The industrial ceramics plant at Hosur, India and the super refractories plant at Ranipet, India have received the integrated management system certification during the year. TPM initiatives have been commenced in certain plants and would be taken forward during 2013.

Last year, the Company had entered into a joint venture with an international partner for manufacture of ceramic foam based refractory products. Construction of the pilot plant in Kerala, India is progressing and is expected to be completed in 2013-14.

As a result of the operating cost increases, the ceramics business recorded a decline in operating profit before interest and tax on a consolidated basis and on a standalone basis.

ELECTROMINERALS

BUSINESS PROFILE

As a consolidated entity, the major product groups of this business segment are fused alumina (comprising brown and white alumina), silicon carbide, fused zirconia, alumina zirconia and zirconia mullite. The company also manufactures a range of ‘specialities’ like semifriable, Azure-S and plasma powders for niche markets. The operations are carried out through seven manufacturing facilities located in India, Russia and South Africa. Products are sold to customers located in over 40 countries. Key user industries for this business are abrasives, refractories and steel. The business also has captive mines and a captive power plant.

INDUSTRY SCENARIO

In fused alumina, the company is largely a national player with customers based in India. The Indian market continues to be catered by two players. Apart from the domestic players, imported products have a visible share in the market.

In the global electrominerals business, the Company continues to retain its position as one of the reputed manufacturers of silicon carbide and fused zirconia. The silicon carbide industry has been impacted by the adverse developments in the solar power industry in Europe which was emerging as a lucrative segment for this business.

This could see some of the smaller players making an exit. Barring the changes that are happening from the above developments, there was no major change in the industry structure.

SALES OVERVIEW

The electrominerals business recorded revenues (excluding captive supplies) of Rs.6151.000 millions on a consolidated basis and Rs. 1503.000 millions on a standalone basis. The decline in revenues was a result of the difficult market conditions and also the setback in the solar wafering industry. Sluggishness in off-take was witnessed across all product segments.

Sales of silicon carbide by the Russian operations declined. While off-take from the domestic Russian markets improved, exports to the European and other markets declined. Revenues were also impacted by a shift in the product mix to low value products due to market conditions.

The Indian operations witnessed a marked drop in sales primarily on account of lower exports of silicon carbide products to the solar wafering industry and also the slowdown in the key user industries which impacted sales of brown fused alumina and silicon carbide. The business managed to retain its major customers who still continued wafering operations, on the back of highly consistent quality, supported by aggressive pricing. Efforts to identify alternative end uses for speciality silicon carbide products as a longer term initiative are being continued. Sales of ceramic grains has shown good growth. Price realization across product lines was stable during the year under review, except for the silicon carbide products.

Sales of fused zirconia from the South African operations was adversely impacted. Off-take from European customers was sluggish as a result of the financial crisis in the European Union. Increase in production costs leading to higher prices diminished sales opportunities. The initiatives commenced last year to widen customer base and make an entry into new geographies started yielding results. New customer accounts were opened during the year as a result of these efforts.

In the fused minerals operation in South Africa, which was acquired during the second quarter of the year, the process of integrating the operations with the overall Company was taken up. The business has started receiving schedule orders from a key customer. Trial supplies have been made to a few new customers and these have shown promise of maturing into regular orders. Price realization for minerals was low in the served markets.

MANUFACTURING

In Russia, the silicon carbide fusion facilities and the crushing and grading operations were operated to meet the product mix requirements of the market. The Company was able to take advantage of its inherent flexibility in its manufacturing process, to tune production to generate more metallurgical products instead of crystalline products which helped it to mitigate the impact of the market downturn.

The profitability of the Indian operations were significantly impacted by the lower power generation at the captive hydel power plant at Maniyar (Kerala, India). Lower rainfall in Kerala adversely impacted power generation and

consequently the profitability of this operation.

The silicon carbide plant at Koratty received OHSAS certification. Work has been done on increasing operating efficiencies in logistics and procurement.

In South Africa, production levels of the plant at Foskor Zirconia were moderated to adjust to the sluggish off-take from customers and also to reduce inventory levels. Construction of the new tilt furnace for manufacture of bubble zirconia, which was commenced last year, has taken longer than originally planned. The plant has been commissioned towards the end of the year. In the newly acquired fused minerals unit, the production is being streamlined and as such production volume was low.

Operating margins of the business were impacted on account of increase in prices of key inputs like power and calcined alumina. The difficult market situation did not allow price increases to be passed on to customers.

As a result of lower price realization, steep increase in cost of power and also the adverse product mix in the silicon carbide business, the electrominerals business recorded a steep drop in operating profit before interest and tax on a consolidated basis and on a standalone basis.

CONTINGENT LIABILITIES

(Rs. In Millions)

Particular	31.03.2013	31.03.2012
a. No provision is considered necessary for disputed income tax, sales tax, service tax, excise duty and customs duty demands which are under various stages of appeal proceedings as given below :
i. Income Tax Act, 1961	108.800	119.020
ii. Central Sales Tax Act,1956 and Local Sales Tax laws of various states	18.470	12.990
iii. Central Excise Act,1944	4.290	4.390
iv. Service Tax, 1994	2.860	2.860
v. Customs Act, 1962	-	1.660
b. Outstanding letters of comfort / guarantee given on behalf of subsidiaries	2640.130	2046.610
c. Outstanding letters of credit	170.190	175.280
d. Outstanding bills discounted	1.720	2.150
e. Claims against the Company not acknowledged as debts :
i. Urban Land Tax	3.090	3.500
ii. Stamp duty	1.900	1.900
iii. Electricity charges	-	12.600
iv. Claim filed by ship liner towards damages	14.000	14.000
v. Claim filed before Consumer Dispute Redressal Forum	1.000	1.000
vi. Mining Royalty	42.800	42.800
	62.790	75.800
f. Employees demands pending before Labour Courts - quantum not ascertainable at present
In respect of the above demands disputed by the company, appeals filed are pending before respective appellate authorities. Outflows, if any, arising out of these claims would depend on the outcome of the decision of the appellate authorities and the company's rights for future appeals. No reimbursements are expected.

FIXED ASSETS

Tangible Assets

· Land

· Buildings

· Plant and Equipment

· Furniture and Fixtures

· Vehicles

· Vehicles taken on lease

Intangible Assets

· Goodwill

· Trade Marks

· Technical Knowhow

· Software

AS PER WEBSITE DETAILS

Press Release

CARBORUNDUM UNIVERSALIS CONSOLIDATED QL NET SALES SEQUENTIALLY UP BY 5%

Consolidated Operating PBT sequentially up by 79%

Chennai, 30th July 2013: The Board of Directors met today and approved the results for the quarter ended 30th June 2013.

Consolidated Ql financial performance

Consolidated net sales increase by 5% to Rs.5010.000 Millions from Rs.4780.000 Millions, on a sequential basis. PBIT (excluding exceptional income) increased by 62% from Rs.330.000 Millions in sequential quarter to Rs.540.000 Millions in the current quarter. On a quarter on quarter basis, sales grew by 1% and PBIT dropped by 15%.

The increase in sales on sequential basis and quarter on quarter basis was largely due to better performance by Electro minerals division. The division witnessed increase in volumes in silicon carbide business in Russia and Aluminas business in India. South African subsidiary reported higher volumes compared to the earlier quarter. Sales also grew for Abrasives segment for both the periods. Ceramic sales however de grew for the same periods.

Profitability of Electro minerals business improved both on a sequential and quarter on quarter basis. Profitability of Abrasives and Ceramics business improved on a sequential basis but dropped on a quarter on quarter basis. The company improved standalone debt equity, which is at its lowest.

Earnings before interest, depreciation and amortization (EBITDA) recorded an increase of 39% (i.e. from Rs.530.000 Millions in sequential quarter to Rs.740.000 Millions in current quarter) without considering exceptional income of last year. On a quarter on quarter basis, that was a decrease of 6%.

Profit before tax and exceptional income was Rs.470.000 Millions - a gain of 79% over the sequential quarter amount of Rs.260.000 Millions. The profit after tax increased from Rs.120.000 Millions to Rs.280.000 Millions. On a quarter on quarter basis, Profit before tax and exceptional income, dropped by 17% and profit after tax dropped by 23%.

Consolidated Segmental Operating Performance

Abrasives

Sales of the abrasives business on a consolidated basis registered a increase of 3% in a sequential basis. Sales for the quarter was Rs.2060.000 Millions (Rs.2000.000 Millions for the sequential quarter). On a quarter on quarter basis, this was an increase of 2%.

Profit before interest and tax on a consolidated basis recorded an increase of 3% i.e. from Rs.196.000 Millions to Rs.203.000 Millions, on a sequential basis. On a quarter on quarter basis, this was a drop of 5%.

The broader business performance of the Abrasives' user industries continues to be moderate. The manufacturing industries continued to have sub optimum levels of production.

Electro Minerals

At a consolidated level, the net sales for Ql were higher at Rs. 195.000 Millions versus Rs. 1670.000 Millions for the sequential quarter. This is a growth of 16%. On a quarter on quarter basis, this was an increase of 6%.

Profit before interest and tax on a consolidated basis recorded a gain from a loss of Rs.71.000 Millions to a profit of Rs. 259.000 Millions, on a sequential basis. On a quarter on quarter basis, the gain was 29%. This was largely due to higher volumes in Silicon carbide business in Russia, lower losses in South African subsidiary and increased Aluminas business in India.

Ceramics

The ceramics segment recorded a 13% drop in sales on a sequential basis (Rs.lll Millions vs. Rs.1280.000 Millions last year). On a quarter on quarter basis, this was a drop of 6%.

Alumina Ceramics business from India, had challenges from market due to project postponements. Refractories sales were lower owing to delayed project orders from user industries. Australian entity registered a lower sales growth.

Profit before interest and tax of the ceramics business on a consolidated basis recorded a drop of 3% from Rs.158.000 Millions to Rs. 153.000 Millions, on a sequential basis. On a quarter on quarter basis, the drop was 38%.

About the Murugappa Group

Founded in 1900, the INR 225 Billion Murugappa Group is one of India's leading business conglomerates. The Group has 28 businesses including eleven listed Companies traded in NSE & BSE. Headquartered in Chennai, the major Companies of the Group include Carborundum Universal Limited, Cholamandalam Investment and Finance Company Limited, Cholamandalam MS General Insurance Company Limited, Coromandel International Limited, Coromandel Engineering Company Limited, E.I.D. Parry (India) Limited, Parry Agro Industries Limited, Sabero Organics Limited, Shanthi Gears Limited, Tube Investments of India Limited, and Wendt (India) Limited.

Market leaders in served segments including Abrasives, Auto Components, Cycles, Sugar, Farm Inputs, Fertilizers, Plantations, Bio-products and Nutraceuticals, the Group has forged strong alliances with leading international companies like Groupe Chimique Tunisien, Foskor, Mitsui Sumitomo, Morgan Crucible and Sociedad Quimica y Minera de Chile (SQM). The Group has a wide geographical presence spanning 13 states in India and 5 continents.

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.63.46
UK Pound	1	Rs.99.42
Euro	1	Rs.85.12

INFORMATION DETAILS

Information Gathered by :	SVA
Report Prepared by :	VRN

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	7
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	8
--PROFITABILIRY	1~10	8
--LIQUIDITY	1~10	8
--LEVERAGE	1~10	7
--RESERVES	1~10	8
--CREDIT LINES	1~10	7
--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	YES
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTER
--RBI	YES/NO	NO
--EPF	YES/NO	NO
TOTAL		65

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.