MIRA INFORM REPORT

Report Date :

11.01.2013

IDENTIFICATION DETAILS

Name :	T T LIMITED
Registered Office :	879, Master Prithvi Nath Marg, Karol Bagh, New Delhi – 110005, Delhi
Country :	India
Financials (as on) :	31.03.2012
Date of Incorporation :	29.09.1978
Com. Reg. No.:	009241
Capital Investment / Paid-up Capital :	Rs. 214.981 Millions
CIN No.: [Company Identification No.]	L18101DL1978PLC009241
TAN No.: [Tax Deduction & Collection Account No.]	DELT04227G
Legal Form :	A Public Limited Liability company. The company’s Share are Listed on the Stock Exchange.
Line of Business :	Manufacturer and Exporter of Cotton yarn, textile fibres, etc.
No. of Employees :	1500 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

B (36)

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

Maximum Credit Limit :	USD 3700000
Status :	Moderate
Payment Behaviour :	Slow but correct
Litigation :	Clear
Comments :	Subject is an established company having a moderate track record. There appears some accumulated loss during the current year recorded by the company. As per previous year’s record, the company has low debt servicing coverage. Increase in competitive pressure and volatility in raw material price affected the profitability. However, the company has experienced Promoter’s and well- established brand. Trade relations are reported to be fair. Business is active. Payments are slow but correct. The company can be considered for business dealings with some caution.

NOTES :

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

ECGC Country Risk Classification List – June 30, 2012

Country Name	Previous Rating (31.03.2012)	Current Rating (30.06.2012)
India	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

INDIAN ECONOMIC OVERVIEW

India is developing into an open-market economy, yet traces of its past autarkic policies remain. Economic liberalization, including industrial deregulation, privatization of state-owned enterprises, and reduced controls on foreign trade and investment, began in the early 1990s and has served to accelerate the country's growth, which has averaged more than 7% per year since 1997. India's diverse economy encompasses traditional village farming, modern agriculture, handicrafts, a wide range of modern industries, and a multitude of services. Slightly more than half of the work force is in agriculture, but services are the major source of economic growth, accounting for more than half of India's output, with only one-third of its labor force. India has capitalized on its large educated English-speaking population to become a major exporter of information technology services and software workers. In 2010, the Indian economy rebounded robustly from the global financial crisis - in large part because of strong domestic demand - and growth exceeded 8% year-on-year in real terms. However, India's economic growth in 2011 slowed because of persistently high inflation and interest rates and little progress on economic reforms. High international crude prices have exacerbated the government's fuel subsidy expenditures contributing to a higher fiscal deficit, and a worsening current account deficit. Little economic reform took place in 2011 largely due to corruption scandals that have slowed legislative work. India's medium-term growth outlook is positive due to a young population and corresponding low dependency ratio, healthy savings and investment rates, and increasing integration into the global economy. India has many long-term challenges that it has not yet fully addressed, including widespread poverty, inadequate physical and social infrastructure, limited non-agricultural employment opportunities, scarce access to quality basic and higher education, and accommodating rural-to-urban migration.

Source : CIA

EXTERNAL AGENCY RATING

Rating Agency Name	CARE
Rating	(CARE) BB+
Rating Explanation	Having Moderate risk of default regarding timely servicing of financial obligation.
Date	April 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. Sanjay Mishra
Designation :	Accounts Department
Contact No.:	91- 11- 45060708
Date :	05.01.2013

LOCATIONS

Registered Office :	879, Master Prithvi Nath Marg, Karol Bagh, New Delhi – 110005, Delhi, India
Tel. No.:	91- 11- 45060708
Mobile No.:	Not Available
Fax No.:	Not Available
E-Mail :	export@tttextiles.com
Website :	http://tttextiles.com
Location :	Owned
Mills/ Factory :	Ø Gajroula (Uttar Pradesh) Ø Avinashi, Distt. Tirupur (Tamil Nadu) Ø Rajula, (Pipavav Port, Gujarat)
Branches :	Ø Kolkata Ø Avinashi Ø Gajroula Ø Rajula

DIRECTORS

As on 31.03.2012

Name :	Dr. Rikhab C Jain
Designation :	Chairman
Name :	Shri Sanjay Kumar Jain
Designation :	Managing Director
Name :	Smt. Jyoti Jain
Designation :	Jt. Managing Director
Name :	Shri. V. R. Mehta
Designation :	Director
Name :	Shri. Navratan Dugar
Designation :	Director
Name :	Dr. (Prof) V. K. Kothari
Designation :	Director

KEY EXECUTIVES

Name :	Shri Sunil Mahnot
Designation :	Vice President (Finance) and Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 30.09.2012

Names of Shareholders	No. of Shares	Percentage of Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	10289170	47.86
Any Others (Specify)	1462027	6.80
Trusts	1462027	6.80
Sub Total	11751197	54.66
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	11751197	54.66
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	800	0.00
Financial Institutions / Banks	700	0.00
Sub Total	1500	0.01
(2) Non-Institutions
Bodies Corporate	677251	3.15
Individuals
Individual shareholders holding nominal share capital up to Rs.0.100 Million	7059972	32.84
Individual shareholders holding nominal share capital in excess of Rs.0.100 Million	1533170	7.13
Any Others (Specify)	474960	2.21
Trusts	500	0.00
Non Resident Indians	40057	0.19
Clearing Members	12141	0.06
Hindu Undivided Families	422262	1.96
Sub Total	9745353	45.33
Total Public shareholding (B)	9746853	45.34
Total (A)+(B)	21498050	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)	21498050	0.00

BUSINESS DETAILS

Line of Business :	Manufacturer and Exporter of Cotton yarn, textile fibres, etc
Exports :
Products :	Textiles Fibres
Countries :	Ø China Ø UK Ø Pakistan Ø USA
Terms :
Selling :	L/ C, Cash and Credit (30 Days)
Purchasing :	Cash and Credit (30 Days/ 70 Days)

GENERAL INFORMATION

No. of Employees :

1500 (Approximately)

Bankers :

Consortium :

Ø Oriental Bank of Commerce, Punchkuiyan Road Branch, Delhi

Ø Punjab National Bank

Others :

Ø Indian Bank

Ø State Bank of Mysore

Ø State Bank of Hyderabad

Ø State Bank of India

Facilities :

Secured Loan	31.03.2012 (Rs. in Millions)	31.03.2011 (Rs. in Millions)
Term Loans
From Banks	1072.396
Loans repayable on demand
From Banks	1078.853
Term Loans
OBC		831.022
PNB		62.437
SBM		263.036
Working Capital Loan
From Banks		1042.257
Total	2151.249	2198.752
Unsecured Loan	31.03.2012 (Rs. in Millions)	31.03.2011 (Rs. in Millions)
Other Borrowings
Fixed Deposits	50.612	50.922
From Directors	130.631	48.417
From Others	78.167	47.800
Total	259.410	147.139

Banking Relations :	----
Auditors :
Statutory Auditors :	Doogar and Associates Chartered Accountants
Address :	Delhi, India
Internal Auditors :	R. S. Modi and Company Chartered Accountants

CAPITAL STRUCTURE

As on 31.03.2012

Authorised Capital :

No. of Shares	Type	Value	Amount
30000000	Equity Shares	Rs.10/- each	Rs. 300.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
21498050	Equity Shares	Rs.10/- each	Rs. 214.981 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		214.981	214.980	214.980
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		732.647	613.872	518.314
4] (Accumulated Losses)		0.000	0.000	(25.459)
NETWORTH		947.628	828.852	707.835
LOAN FUNDS
1] Secured Loans		2151.249	2198.752	2234.243
2] Unsecured Loans		259.410	147.139	169.876
TOTAL BORROWING		2410.659	2345.891	2404.119
DEFERRED TAX LIABILITIES		0.000	37.349	0.000
TOTAL		3358.287	3212.092	3111.954
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		2237.986	1987.296	2063.894
Capital work-in-progress		27.254	19.596	0.029
INVESTMENT		0.023	0.047	0.045
DEFERRED TAX ASSETS		51.249	0.000	44.409
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	641.808	678.195	491.007
	Sundry Debtors	338.073	339.993	287.210
	Cash & Bank Balances	18.715	37.463	16.585
	Other Current Assets	207.180	0.000	0.000
	Loans & Advances	168.588	343.598	405.466
Total Current Assets		1374.364	1399.249	1200.268
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	35.750	3.507	38.777
	Other Current Liabilities	292.818	119.456	146.891
	Provisions	4.021	71.133	11.023
Total Current Liabilities		332.589	194.096	196.691
Net Current Assets		1041.775	1205.153	1003.577
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		3358.287	3212.092	3111.954

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2012	31.03.2011	31.03.2010
	SALES
		Income	3957.536	4879.383	3536.033
		Other Income	82.845	14.984	6.607
		TOTAL (A)	4040.381	4894.367	3542.640
Less	EXPENSES
		Cost of materials consumed	2983.861	3664.763
		Changes in inventories of finished goods, work- in- progress and stock- in- trade	41.893	(120.652)
		Employee benefits expense	143.729	125.186
		Other expenses	600.031	638.478
		TOTAL (B)	3769.514	4307.775	3195.869
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		270.867	586.592	346.771
Less	FINANCIAL EXPENSES (D)		269.278	234.076	190.897
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		1.589	352.516	155.874
Less/ Add	DEPRECIATION/ AMORTISATION (F)		111.340	112.814	95.558
	PROFIT/(LOSS) BEFORE TAX (E-F) (G)		(109.751)	239.702	60.316
Less	TAX (I)		(88.044)	81.757	(44.409)
	PROFIT/ (LOSS) AFTER TAX (G-I) (J)		(21.707)	157.945	104.725
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		37.418	(25.458)	(130.183)
Less	APPROPRIATIONS
		Transfer to General Reserve	0.000	70.000	0.000
		Dividend	0.000	21.498	0.000
		Tax on Dividend	0.000	3.571	0.000
	BALANCE CARRIED TO THE B/S		15.711	37.418	(25.458)
	EARNINGS IN FOREIGN CURRENCY		2.207	2.738	0.023
	IMPORTS
		Raw Materials	----	----	115.887
		Stores & Spares	0.069	0.138	5.568
		Capital Goods	59.710	----	0.000
	TOTAL IMPORTS		59.779	0.138	121.455
	Earnings Per Share (Rs.)
	Basic		(1.01)	7.35	4.87
	Diluted		(1.01)	7.35	4.87

QUARTERLY / SUMMARISED RESULTS

PARTICULARS	30.06.2012 1^st Quarter	30.09.2012 2^nd Quarter
Net Sales	1045.730	1220.050
Total Expenditure	924.420	1101.650
PBIDT (Excl OI)	121.310	118.400
Other Income	0.740	0.900
Operating Profit	122.050	119.300
Interest	74.300	72.080
PBDT	47.750	47.220
Depreciation	29.230	29.800
Profit Before Tax	18.520	17.420
Tax	11.690	(5.590)
Profit After Tax	6.830	23.010
Net Profit	6.830	23.010

KEY RATIOS

PARTICULARS		31.03.2012	31.03.2011	31.03.2010
PAT / Total Income	(%)	(0.54)	3.23	2.96
Net Profit Margin (PBT/Sales)	(%)	(2.77)	4.91	1.71
Return on Total Assets (PBT/Total Assets}	(%)	(3.04)	7.08	1.85
Return on Investment (ROI) (PBT/Networth)		(0.12)	0.29	0.09
Debt Equity Ratio (Total Liability/Networth)		2.89	3.06	3.67
Current Ratio (Current Asset/Current Liability)		4.13	7.21	6.10

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	No
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	No
15]	Capital in the business	Yes
16]	Details of sister concerns	No
17]	Major suppliers	No
18]	Major customers	No
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	No
31]	Date of Birth of Proprietor/Partner/Director, if available	No
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

REVIEW OF OPERATIONS

The year 2011-12 was one of the most difficult year not only for the Company but worldwide textile industry and in many ways even worse than 2008-09. Cotton and yarn prices after touching an all time high in March 2011, suddenly crashed worldwide by over 35% in a short period of two months leaving the whole industry dazed.

This followed by uncertainty in the global market due to European crisis and the imposition of excise duty on garments lead to exceptionally difficult year for all segments of the textile business.

The extreme volatility in the currency in the second half of the year further worsened matters. Last but not the least Policies changes regarding exports of raw cotton and yarn, and reduction of export incentives remained the biggest culprit for the extreme volatility in global textile market.

The year saw the turnover of the Company plunge from Rs. 4850.000 Millions to Rs. 3820.000 Millions i.e. a 21% fall due to poor demand and basic selling prices coming down. Due to the reasons mentioned above, the Company booked a loss of Rs. 21.700 Millions after taxes.

Over the last 2 years, the company has been paying more emphasis on its branded knitwear business. The contribution of this segment increased to 20% of turnover compared to 17% last year. This was despite the fact that due to excise, we lost almost 3 months sales. The turnover of all other divisions reduced due to both lower volumes and prices.

As a part of its strategy to slowly exit the cotton fibre business, the Company sold its ginning factory at Gondal, Gujarat for Rs. 187.500 Millions. The Company also plans to sell its ginning factory at Rajula, Gujarat and exit the volatile cotton commodity business fully and focus on the stable value added business. This crop year, Rajula Ginning Factory was not operated, otherwise it would have further worsened the scenario.

The Company has almost completed its Rs 200.000 Millions garment expansion project in Avinashi. Further it has introduced many new products in its casual wear segment.

This year has broadly been a year of caution and fire fighting. It was difficult to implement new initiatives and push for growth. Losses during the year has occurred mainly due to worldwide fall in cotton value chain since April, 2011, currency volatilities, increase in interest rates, Power rates and withdrawal of export subsidies and increase in taxes.

33r

Annual Report

FUTURE OUTLOOK

The worst is almost over and the company is expected to cover up the set back in the first half of the current year itself. The depreciating rupee, falling cotton prices with low production of yarn across the country due to labour and power issues has created a favourable situation for cotton yarn. However with the global uncertainty so high, non clarity of Government policies – its difficult to predict precisely. We hope for the best.

The Government TUF scheme for textiles has expired in March 2012, and all are waiting for the new policy announcement. However the Company has no major expansion plans for this year, though the Rs 1000.000 Millions spinning expansion project at Rajula (Gujarat) is going on and is expected to be completed by March 2013. TUF sanctions for this project had already been confirmed in time.

The Company during the preceding year, due to slow demand and excise issues, had to go slow on its knitwear business. However this year once again the Company is looking for 50% growth in this segment. It is planning to go for a totally new ad campaign and put extra thrust on electronic and press media. The Company is also planning to focus on setting up exclusive shops in a big way, e-commerce and digital marketing through social media.

The Company plans to leverage its strong brand equity and expand over markets and products with strong designing, advertisement and merchandising.

The yarn and fabric segments are expected to grow at 20% per annum, however margins are expected to be much better than last year.

They are confident that the Company will be back on the growth path after a watershed year.Their emphasis on high margin business and focus on stable business portfolio can be expected to show positive results for the Company and its stake holders.

The Company intends to install Solar Power Plants offline for localized captive consumption within each Spinning Mills. They hope by 2016 all our mills and manufacturing units will be running 100% on clean Solar / Wind Power. This move is to promote eco-sustainability and will certainly be our bit of efforts to “save earth” and to “save trees”

AWARDS AND RECOGNITION

During the year Brand “T.T.” has been awarded with MASTER BRAND STATUS BY CMO ASIA (AFFILIATED OF CMO COUNCIL, USA).

OVERVIEW OF INDIAN TEXTILE INDUSTRY

The Indian Textile Industry is proud to be the second biggest in the world. It was predominantly unorganized industry until a few decades back. However, the scenario started changing on after the economic liberation of Indian economy since 1991. The opening up of the economy gave the much-needed thrust to the Indian Textile industry. It has now successfully become modern, high technology run and has the potential of becoming the largest one overtaking the presently number one Chinese Textiles. Indian textile industry largely depends upon the textile manufacturing and export. It also plays a major role in the economy of the country. India earns about 12 per cent of its total foreign exchange through textile exports. Further, the textile industry of India also contributes nearly 14% of the total industrial production of the country. It also contributes around 4% to the GDP of the Country. Indian textile industry is also the largest in the country in terms of employment generation. It not only generates jobs in its own industry, but also opens up scope for the other ancillary sectors. Indian textile industry currently generates employment to more than 35 million people.

TRENDS IN WORLD TRADE

World Trade recorded its largest ever annual increase in 2010 as merchandise exports surged 14.5 per cent, buoyed by a 3.6 per cent recovery in global output as measured by gross domestic product (GDP). Both trade and output grew faster in developing economies than in developed ones. Exports in volume terms were up 13 per cent in developed economies while the increase for developing economies was nearly 17 per cent.

TRADE SCENARIO IN INDIA

Indian domestic consumption of textiles is growing at a fast pace of 15-20% annually. Hence the importance of this segment is growing and there is great potential for Companies with good domestic distribution network and brand equity. Hence in future companies need to have more balanced presence in both exports and domestic market to reduce uncertainties and have balanced growth. From Raw material to finished goods, vertically and horizontally an integrated textile value chain exists. Indian textile sector holds a unique blend of tradition and technology with flexible production system and strong entrepreneurial skills. As they all know, Asia in the recent past witnessed a recovery that has matured as both exports and domestic demand have fuelled rapid economic growth, which reached 8.3 per cent in 2010. Growth is expected to be led by China and India, whose economies are projected to expand by 8.2 per cent and 7.2 per cent, respectively, in the next two years.

GLOBAL TRADE IN TEXTILES AND CLOTHING

The World trade in Textiles and Clothing is estimated to grow by 10.82 per cent for the year 2010, playing a significant role in total merchandise trade with a share of around 4 per cent. The trade is estimated at a level of USD 584 billion in the year 2010 marking growth of 10.82% over the previous year’s level of USD 527 billion. In EU (27), the combined imports of Textiles and Clothing grew by 6.62 per cent. While Textile trade grew by 19.53 per cents, Clothing grew by 2.64, per cent during 2010.

COTTON YARN EXPORTS

Within the textile basket, exports of cotton yarn reached a level of 720 Million Kgs. as compared to 586.76 Million Kgs. in 2009-10. In volume terms the growth increased by 22 per cent and in dollar terms the growth was 62 per cent rising from USD 1614.76 Million (Rs. 75912.88 Million) in 2009-10 to USD 2619.16 Million (Rs. 118936.06 Million) in 2010-11. It is to be noted that in spite of quantitative restrictions cotton yarn exports recorded the highest growth in the garment of textiles products. Yarn export has since been brought under OGL with from April, 2011. Prices in the world market have started to moderate and the down stream industry in various textile economies is looking forward to stability in policies and prices. As the largest supplier of Cotton Yarn to the world in value terms as well as quantity terms, India needs to be cautious of its external obligations as Policy interventions imposing supply side restrictions have a significant bearing on international trade. This fact was repeatedly brought to the notice of the Council by many Overseas Textile Associations and Federations during interactions at various Fairs/Exhibitions and meets.

33rd Annual Report

FIXED ASSETS

• Freehold Land
• Leasehold Land
• Building
• Plant and Machinery
• Furniture and Fixture
• Electric Installation
• Office Equipment
• Vehicles
• Wind Mill

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. 55.33
UK Pound	1	Rs. 89.05
Euro	1	Rs. 72.57

INFORMATION DETAILS

Information Gathered by :	PDT
Report Prepared by :	RJT

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	4
PAID-UP CAPITAL	1~10	4
OPERATING SCALE	1~10	4
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	4
--PROFITABILIRY	1~10	4
--LIQUIDITY	1~10	4
--LEVERAGE	1~10	4
--RESERVES	1~10	4
--CREDIT LINES	1~10	4
--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	NO
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		36

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

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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.