MIRA INFORM REPORT

Report Date :

26.02.2013

IDENTIFICATION DETAILS

Name :	NALCO WATER INDIA LIMITED (w.e.f.10.10.2011)
Formerly Known As :	NLC NALCO INDIA LIMITED (w.e.f.10.11.2006) ONDEO NALCO INDIA LIMITED
Registered Office :	S. No 238/239, 3rd Floor, Quadra 1, Panchshil, Magarpatta Road, Sade Satra Nali, Pune – 411028, Maharashtra
Country :	India
Financials (as on) :	31.03.2012
Date of Incorporation :	16.12.1987
Com. Reg. No.:	11-140332
Capital Investment / Paid-up Capital :	Rs. 50.000 Millions
CIN No.: [Company Identification No.]	U22229PN1987PLC140332
PAN No.: [Permanent Account No.]	AAACO4994N
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturer and Exporter of Specialty Chemicals and Equipments.
No. of Employees :	Information declined by the management

RATING & COMMENTS

MIRA’s Rating :

Ba (45)

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

Maximum Credit Limit :	USD 1670000
Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject is a subsidiary of Nalco Company USA. It is a well established company having satisfactory track record. Profitability of the company appears to be low. However, 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

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 DECLINED BY

Name :	Mr. Vipin Raghvan
Designation :	Finance Manager
Contact No.:	91-20-39394380
Date :	23.02.2013

LOCATIONS

Registered Office/ Headquarters :	S. No 238/239, 3rd Floor, Quadra 1, Panchshil, Magarpatta Road, Sade Satra Nali, Pune – 411028, Maharashtra, India
Tel. No.:	91-20-39394000/ 39394380
Fax No.:	91-20-39394380
E-Mail :	sbhattachar2@nalco.com
Website :	www.nalco.com
Factory :	1, Lenin Sarani, P.O.IS. Gnnagar, District Hooghly - 712235, West Bengal, India
Tel. No.:	91-33-26740296/ 395/ 697/ 698
Fax No.:	91-33-26722287/ 26721775
Headquarters :	Located at: Ø Kolkata Ø Baroda Ø Chennai Ø Delhi Ø Jamshedpur Ø Konnagar Ø Pune

DIRECTORS

AS ON 22.08.2012

Name :	Mr. Mahesh Rao
Designation :	Managing director
Address :	1 Weifng Xilu, Shimao Riviera Grd, Build 2, Pudong, Shanghai, China 200120
Date of Birth/Age :	20.11.1960
Qualification :	Engineer
Date of Appointment :	22.03.2012
DIN No.:	05232013
Name :	Hin Hao Liaw
Designation :	Director
Address :	26 Choachukangst 64, 23-03, Singapore 689096
Date of Birth/Age :	28.05.1967
Qualification :	Finance
Date of Appointment :	19.02.2010
DIN No.:	02882248
Name :	Mr. Ritesh Nandan Sarkar
Designation :	Director
Address :	Bengal Ambuja Hsing Uditaft 303105/1, Kolkata – 700075, West Bengal, India
Date of Birth/Age :	12.08.1939
Qualification :	ACS,LLB
Date of Appointment :	20.04.2001
DIN No.:	00517760
Name :	Tapas Ranjan Majumdar
Designation :	Director
Address :	406/3, G Block, New Alipore, Kolkata – 700053, West Bengal, India
Date of Birth/Age :	01.07.1933
Qualification :	ACA
Date of Appointment :	20.04.2001
DIN No.:	00554739
Name :	David Martin Andrew Knowles
Designation :	Director
Address :	12 Boambillee, Avenue Vaucluse NSW Australia 2030
Date of Birth/Age :	28.08.1949
Qualification :	Engineer
Date of Appointment :	01.08.2007
DIN No.:	01772073
Name :	Eric Gordon Melin
Designation :	Director
Address :	Room 2101, Block 3, No. 168, Shunchangrd, Shanghai, China 200000
Date of Birth/Age :	07.01.1960
Qualification :	Engineer
Date of Appointment :	08.07.2009
DIN No.:	02657028
Name :	Peter Licovski
Designation :	Director
Address :	75 Hodge Street, Hurtsville, NSW Australia
Date of Birth/Age :	29.07.1961
Qualification :	Finance
Date of Appointment :	22.09.2010
DIN No.:	03166901
Name :	Karl Sohrab Munshi
Designation :	Director appointed in casual vacancy
Address :	Fariyas BI 143, August Kranti Marg, Mumbai, Maharashtra, India
Date of Birth/Age :	08.04.1954
Date of Appointment :	19.06.2012
DIN No.:	02323024

KEY EXECUTIVES

Name :	Mr. Vipin Raghvan
Designation :	Finance Manager
Name :	Sumitro Bhattacharya
Designation :	Secretary
Address :	Flat No. 17, 49 B Southern Avenue, Kolkata – 700029, West Bengal, India
Date of Birth/Age :	04.07.1976
Date of Appointment :	01.09.2010
PAN No.:	AIXPB8675P
Name :	Hari Reddy
Designation :	Head-R&D
Date of Birth/Age :	42 Years
Qualification :	Ph. D-Materials Engineering Services
Experience :	15 Years
Name :	Rory Macintyre
Designation :	Sales Manager
Date of Birth/Age :	43 Years
Qualification :	B. Sc-Chemical Engineering (Hons)
Experience :	20 Years
Name :	Amit G Patel
Designation :	Finance Manager
Date of Birth/Age :	30 Years
Qualification :	B. Sc -Finance
Experience :	8 Years
Name :	Sabyasachi Ghosh
Designation :	Sr. Procurement Manager
Date of Birth/Age :	32 Years
Qualification :	BE Chemical, Masters in Industrial Logistics
Experience :	9 Years

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

SHAREHOLDING DETAILS FILE ATTACHED

AS ON 22.08.2012

Equity Share Breakup	Percentage of Holding
Category
Foreign holdings [Foreign institutional investors, Foreign Companies, Foreign Financial Institutions, Non-resident Indian or Overseas corporate bodies or others]	98.38
Other top fifty shareholders	1.62
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer and Exporter of Specialty Chemicals and Equipments.

Products :

ITC Code	Product Descriptions
99999999	Water Treatment Chemicals

PRODUCTION STATUS (AS ON 31.03.2012)

Particulars	Unit	Installed Capacity	Actual Production
Water treatment chemicals	Tonnes	6,200	8,440
Industrial additives	Tonnes	2,000	2,966
Oilfield chemicals	Tonnes	4,000	1,752
De-mineralized Water	1000 Cubic Meter	2,957	1,598

GENERAL INFORMATION

No. of Employees :	Information declined by the management
Bankers :	Not Available

Banking Relations :	--
Auditors :
Name :	Price Waterhouse and Company Chartered Accountants
Address :	Muttha Towers, 5^th Floor, Suite No. 8, Airport Road, Yerwada, Pune – 411006, Maharashtra, India
Income-tax PAN of auditor or auditor's firm :	AADFP9359C
Holding company :	Nalco Company, USA
Ultimate Holding Company :	Ecolab Inc.
Fellow Subsidiary Company :	Ø Nalco IP Holder LLC Ø Nalco Pacific Pte Limited Ø Nalco Industrial Services (Suzhou) Company Limited Ø Nalco Industrial Services (Nanjing) China Ø Nalco Italia SRL Ø Nalco Europe SARL Ø Nalco Europe B.V. Ø Ecolab Food Safety and Hygiene Solutions Private Limited [U24132MH2007PTC197278] Ø Nalco Japan Company Limited Ø Nalco Korea Limited Ø Nalco Canada Company Ø Pt Nalco Indonesia Limited Ø Nalco Industrial Services Thailand Company Limited Ø Nalco Australia Pty Limited Ø Nalco Taiwan Company Limited Ø Nalco Limited, UK Ø Nalco Deutschland GmbH Ø Nalco Dubai

CAPITAL STRUCTURE

AS ON 31.03.2012

Authorised Capital :

No. of Shares	Type	Value	Amount
10,000,000	Equity Shares	Rs. 10/- each	Rs. 100.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
5,000,000	Equity Shares	Rs. 10/- each	Rs. 50.000 Millions

Notes:

1) Of the above equity shares, 4,918,767 (Previous year 4,918,767) shares of Rs 10 Each are held by holding company, Nalco Company, USA.

2) Rights, preferences and restrictions attached to shares

The company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all referential amounts, in proportional 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		50.000	50.000	50.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		367.900	347.400	679.238
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		417.900	397.400	729.238
LOAN FUNDS
1] Secured Loans		0.000	0.000	41.609
2] Unsecured Loans		1235.000	567.100	0.000
TOTAL BORROWING		1235.000	567.100	41.609
DEFERRED TAX LIABILITIES		1.400	1.600	0.000
TOTAL		1654.300	966.100	770.847
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		721.000	657.700	331.697
Capital work-in-progress		62.000	94.200	101.093
INVESTMENT		0.000	0.000	0.000
DEFERRED TAX ASSETS		0.000	0.000	11.539
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	453.000	396.300	472.285
	Sundry Debtors	783.300	650.500	479.620
	Cash & Bank Balances	68.200	128.000	39.697
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	313.600	352.600	221.053
Total Current Assets		1618.100	1527.400	1212.655
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	478.400	498.700	816.050
	Other Current Liabilities	244.300	783.600	47.020
	Provisions	24.100	30.900	23.067
Total Current Liabilities		746.800	1313.200	886.137
Net Current Assets		871.300	214.200	326.518
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		1654.300	966.100	770.847

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2012	31.03.2011	31.03.2010
	SALES
		Revenue from operations	2967.300	2542.800	1943.377
		Other Income	3.300	14.000	53.228
		TOTAL	2970.600	2556.800	1996.605
Less	EXPENSES
		Cost of materials consumed	1071.400	831.800
		Purchases of stock-in-trade	260.100	287.900
		Changes in inventories of finished goods, work-in-progress and stock-in-trade	(60.900)	51.600
		Employee benefit expense	506.800	409.800
		Other expenses	1566.900	1194.700
		TOTAL	3344.300	2775.800	1846.289
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION		(373.700)	(219.000)	150.316
Less	FINANCIAL EXPENSES		131.700	36.000	8.510
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION		(505.400)	(255.000)	141.806
Less/ Add	DEPRECIATION/ AMORTISATION		126.200	87.500	62.741
Add	PRIOR PERIOD ITEMS BEFORE TAX		0.000	9.600	0.000
Add	EXCEPTIONAL ITEMS BEFORE TAX		651.900	0.000	0.000
	PROFIT BEFORE TAX		20.300	(332.900)	79.065
Less	TAX		(0.200)	(1.100)	13.219
	PROFIT AFTER TAX		20.500	(331.800)	65.846
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		235.333	567.133	501.287
	BALANCE CARRIED TO THE B/S		255.833	235.333	567.133
	EARNINGS IN FOREIGN CURRENCY
		FOB Value of exports	33.800	8.400
		One time subsidy from Nalco Company, USA, the Holding Company	651.900	0.000
		Export of Services	418.100	203.000
	TOTAL EARNINGS		1103.800	211.400	N.A.
	IMPORTS
		Raw Materials	663.600	549.300
		Stores & Spares	9.600	8.800
		Capital Goods	9.100	113.900
	TOTAL IMPORTS		682.300	672.000	N.A.
	Earnings Per Share (Rs.)		4.10	(66.36)	13.17

KEY RATIOS

PARTICULARS		31.03.2012	31.03.2011	31.03.2010
PAT / Total Income	(%)	0.69	(12.98)	3.30
Net Profit Margin (PBT/Sales)	(%)	0.68	(13.09)	4.07
Return on Total Assets (PBT/Total Assets}	(%)	0.87	(15.24)	5.12
Return on Investment (ROI) (PBT/Networth)		0.05	(0.84)	0.11
Debt Equity Ratio (Total Debt/Networth)		2.96	1.43	17.53
Current Ratio (Current Asset/Current Liability)		2.17	1.16	1.37

LOCAL AGENCY FURTHER INFORMATION

SUNDRY CREDITORS DETAILS:

Particulars	31.03.2012	31.03.2011	31.03.2010
	(Rs. In Millions)
Trade Payable	478.400	498.700	816.050

Sr. No.	Check List by Info Agents	Available in Report (Yes / No)
1]	Year of Establishment	Yes
2]	Locality of the firm	Yes
3]	Constitutions of the firm	Yes
4]	Premises details	No
5]	Type of Business	Yes
6]	Line of Business	Yes
7]	Promoter's background	Yes
8]	No. of employees	No
9]	Name of person contacted	Yes
10]	Designation of contact person	Yes
11]	Turnover of firm for last three years	Yes
12]	Profitability for last three years	Yes
13]	Reasons for variation <> 20%	--
14]	Estimation for coming financial year	No
15]	Capital in the business	Yes
16]	Details of sister concerns	Yes
17]	Major suppliers	No
18]	Major customers	No
19]	Payments terms	No
20]	Export / Import details (if applicable)	No
21]	Market information	--
22]	Litigations that the firm / promoter involved in	--
23]	Banking Details	No
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	No

UNSECURED LOANS

Unsecured Loans	31.03.2012	31.03.2011
	(Rs. In Millions)
Term Loans from Banks	252.800	217.000
Working Capital Loan repayable on demand from banks	960.000	350.100
Cash Credit Accounts	22.200	0.000
Total	1235.000	567.100

Note:

The above term loan is secured by Corporate Guarantee from Nalco Company, USA, the Holding Company, and is repayable in 18 equal quarterly installments starting from March 31, 2012 along with interest rate of 12% p.a.

The working capital loan is secured by Corporate Guarantee from Nalco Company, USA, the Holding Company.

NATURE OF OPERATIONS

The company operates in the Chemical Industry and its products are mainly used for Industrial purpose having a wide range of application in various Industries.

ECONOMY AND THE COMPANY’S BUSINESS

During the year, the global economic environment, which remained tenuous throughout the year, turned sharply adverse in the month of August-September 2011 owing to the turmoil in the Eurozone, and questions about the outlook on the US economy provoked by rating agencies which indirectly told upon the Indian economy as well. At the same time, sight must not be lost of the fact that, by any cross country comparison, India remains among the front-runners. However, political instability, stiff inflationary pressures, interest rate and foreign exchange rate fluctuations, fluctuating oil prices and weak manufacturing activity have led to loss of revenue and a consequent cash crunch in the economy.

The Company witnessed an increase in sales volumes by 17% during the year under consideration in comparison to last year which supported recovery of the loss of previous year marginally. In addition to this, the Company received a onetime subsidy of Rs.651.900 Millions from Nalco Company USA, its holding company towards meeting administrative expenses incurred by the Company for relocation of its operations and also for materializing the investment plans that the Company has drawn for sustainable growth. But the above mentioned macroeconomic factors coupled with rising cost of capital, raw material cost, steep increase in administrative and miscellaneous expenses had a negative impact on the revenue earnings of the Company. Challenges were in managing cash to cash cycle (payment for procurement to collection for sales) which needs continuous fund infusion and consequently increases the capital requirements. This risk is especially relevant for growth oriented Company like and the kind of business the Company operates in. Efforts to rejuvenate the bottom line through careful management of the expenses, consolidation of services, savings linked performance incentive schemes, price hike of products and sales volume increase remains unabated.

Nalco Holding Company, the parent company of Nalco Company USA, (holding Company of The Company) got merged with Ecolab Inc., the global leader in cleaning, sanitizing, food safety and infection prevention products and services and delivers its services in more than 160 countries. Thus Ecolab, Inc. happens to be the ultimate parent company of the Company as a consequence of this merger. Apart from the same, the above merger had no legal implication on the legal status of the Company.

BUSINESS PROSPECTS

The business environment will continue to remain challenging characterized by intense competition, margin pressures and regulatory interventions. These changes pose many challenges and opportunities to companies operating in this environment. Their goal is to leverage their strengths to continue to expand their capacities in each of their respective business lines and expand. This growth requires a large pool of trained sales people on continuous basis for implementation of the system and also requires a dedicated dealer network. They are using advanced automation technologies and chemistries to manage water effectively and economically in both municipal and industry space which in turn will resolve the issue of insufficient water for sustainable development.

The growing water scarcity across the Country is a significant challenge and their water purification, recycle and reuse initiatives will play an important role in the time to come.

CONTINGENT LIABILITIES NOT PROVIDED FOR

(Rs. in millions)

Particulars	31.03.2012	31.03.2011
Income Tax matters	142.100	120.900
Sales Tax matters	73.200	58.600
Excise Duty / Service Tax matters	18.200	79.200
Other third party claims against loss on commissioning of water treatment and effluent treatment plants not acknowledged as debt and under litigation (excluding interest)	168.400	168.400
Claim filed by an individual pending with the Hon'ble High Court of Kolkata (excluding interest)	17.600	17.600
Total	419.500	444.700

FIXED ASSETS:

TANGIBLE ASSETS

Ø Freehold Land

Ø Buildings on leasehold land

Ø Plant and Machinery

Ø Computers

Ø Vehicles

Ø Furniture and Fixtures

Ø Leasehold Improvements

INTANGIBLE ASSETS

Ø Goodwill

Ø Trademarks

Ø Technical know-how

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. 54.04
UK Pound	1	Rs. 81.80
Euro	1	Rs. 71.41

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	5
--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	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTERS
--RBI	YES/NO	NO
--EPF	YES/NO	NO
TOTAL		45

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.