MIRA INFORM REPORT

Report Date :

23.01.2013

IDENTIFICATION DETAILS

Name :	NAGREEKA EXPORTS LIMITED
Registered Office :	18, R.N. Mukherjee Road, 6^th Floor, Kolkata – 700001, West Bengal
Country :	India
Financials (as on) :	31.03.2012
Date of Incorporation :	06.03.1989
Com. Reg. No.:	21-0486387
Capital Investment / Paid-up Capital :	Rs.62.550 Millions
CIN No.: [Company Identification No.]	L1810WB1989PLC046387
TAN No.: [Tax Deduction & Collection Account No.]	CALN02503E
PAN No.: [Permanent Account No.]	AAACN9999A
Legal Form :	A Public Limited Liability Company. The Company’s shares are listed on Stock Exchange.
Line of Business :	Manufacturers, Exporters and Marketers of Cotton Yarn and Knitted Fabrics.
No. of Employees :	250 [Approximately]

RATING & COMMENTS

MIRA’s Rating :

Ba (42)

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

Maximum Credit Limit :	USD 3440000
Status :	Satisfactory
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is a well established company having satisfactory track record. There appears sharp dip in the profitability. However, net worth of the company seems to be satisfactory. Trade relations are reported to be fair. Business is active. Payments are reported to be usually correct and as per commitment. The company can be considered for normal business dealings at usual trade terms and conditions.

NOTES :

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

ECGC Country Risk Classification List – June 30, 2012

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

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

INDIAN ECONOMIC OVERVIEW

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

Source : CIA

EXTERNAL AGENCY RATING

Rating Agency Name	CARE
Rating	A3 (Short term bank facilities)
Rating Explanation	Moderate degree of safety. It carry moderate credit risk.
Date	28^th December 2012

Rating Agency Name	CARE
Rating	BBB- (Long term bank facilities)
Rating Explanation	Moderate degree of safety. It carry moderate credit risk.
Date	28^th December 2012

RBI DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available RBI Defaulters’ list.

EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of 31-03-2012.

LOCATIONS

Registered Office :	18, R.N. Mukherjee Road, 6th Floor, Kolkata – 700 001, West Bengal, India
Tel. No.:	91-33-22108828/22484922/4943
Fax No.:	91-33-22481693
E-Mail :	info@nagreeka.com sunil@nagreeka.com rathin@nagreeka.com knbansal@nagreeka.com
Website :	www.nagreeka.com
Corporate Office 1 :	7, Kala Bhavan 2, Mathew Road, Mumbai – 400004, Maharashtra, India
Tel. No.:	91-22-23670365/61447500
Fax No.:	91-22-23612579/23630475
E-Mail :	Info@nagreeka.com salea@nagreeka.com purchase@nagreeka.com
Corporate Office 2 :	21-22, Kala Bhavan, 3, Mathew Road, Mumbai – 400004, Maharashtra, India
Factory :	Village Yavluji, Taluka Panhala, District – Kolhapur, Maharashtra, India

DIRECTORS

AS ON 30.09.2012

Name :	Mr. Shushil Patwari
Designation :	Chairman and Managing Director
Date of Birth/Age :	20.08.1954
Qualification :	B. Com (H)
Date of Appointment :	06.03.1989
Other Directorship :	Rupa and Company Limited Reliance Processors Limited Nagreeka Capital and Infras-tructure Limited Jaidka Motor Company Limited
Name :	Mr. Sunil Patwani
Designation :	Vice Chairman and Managing Director

Name :	Mr. Kailash Chandra Purohit
Designation :	Whole – time Director
Date of Birth/Age :	18.06.1932
Qualification :	B. Tech
Date of Appointment :	30.06.2001

Name :	Mr. Mohan Kishen Ogra
Designation :	Director
Date of Birth/Age :	15.09.1930
Qualification :	Graduate (Maths and Stastic)
Date of Appointment :	30.06.2001
Other Directorship :	Nicco Financial Services Limited Nicco Engg. Services Limited Nicco Biotech Limited Nagreeka Capital and Infrastructure Limited

Name :	Mr. Bibhuti Charan Talukdar
Designation :	Director

Name :	Mr. Mahendra Patwari
Designation :	Whole-time Director
Date of Birth/Age :	15.03.1963
Qualification :	B. E. from IIT
Date of Appointment :	01.07.2004
Other Directorship :	Nagreeka Foils Limited

Name :	Mr. Rajendra Mahavirprasad Ruia
Designation :	Director

Name :	Mr. Mahabir Prasad Periwal
Designation :	Director
Date of Birth/Age :	12.08.1944
Qualification :	Graduate
Date of Appointment :	07.08.2008
Other Directorship :	Pinoreer Protec Limited Pioneer Plastic Industrial Limited Sarda Housing Developments Private Limited

KEY EXECUTIVES

Name :	Mr. J. Tiwari
Designation :	Company Secretary

SHAREHOLDING PATTERN

As on 30.09.2012

Category of Shareholder	Total No. of Shares	Total Shareholding as a % of total No. of Shares
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	4472300	35.78
Bodies Corporate	2105186	16.84
Sub Total	6577486	52.62
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	6577486	52.62
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	3300	0.03
Financial Institutions / Banks	300	0.00
Foreign Institutional Investors	300	0.00
Sub Total	3900	0.03
(2) Non-Institutions
Bodies Corporate	2343135	18.75
Individuals
Individual shareholders holding nominal share capital up to Rs.0.100 Million	10514	21.27
Individual shareholders holding nominal share capital in excess of Rs.0.100 Million	696456	5.57
Any Others (Specify)	220164	1.76
Non Resident Indians	217883	1.74
Trusts	800	0.01
Clearing Members	1481	0.01
Sub Total	5918314	47.35
Total Public shareholding (B)	5922214	47.38
Total (A)+(B)	12499700	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued
(1) Promoter and Promoter Group	0	0
(2) Public	0	0
Sub Total	0	0
Total (A)+(B)+(C)	12499700	100.00

BUSINESS DETAILS

Line of Business :

Manufacturers, Exporters and Marketers of Cotton Yarn and Knitted Fabrics.

Products :

ITC Code	Product Description
Cotton Yarn	52.05
Knitted Fabric	60.20

PRODUCTION STATUS [AS ON 31.03.2011]

Particulars	Unit	Licensed Capacity	Installed Capacity	Actual Production
Yarn	Spindle	56784	55440	--
Cotton Yarn	Kg.	--	--	9435626
Cloth Weaving	Mtr.	--	733000	877345
Cloth Processing	Mtr.	--	792000	846887
Knitted Fabrics	Kg.	--	--	126658

GENERAL INFORMATION

No. of Employees :

250 [Approximately]

Bankers :

· Canara Bank, Overseas Branch, Kolkata, Mumbai

· ING VYSYA Bank Limited, Overseas Branch, Mumbai

· Oriental Bank of Commerce, Overseas Branch, Kolkata

· State Bank of Patiala, Commercial Branch, Mumbai

· Allahabad Bank, Industrial Finance Branch, Kolkata

· ICICI Bank, R.N. Mukherjee Road Branch, Kolkata

Facilities :

Secured Loan	Rs. In Millions 31.03.2012	Rs. In Millions 31.03.2011
Term loan from bank	453.041	522.105
Working capital loans from bank	1048.788	1084.532
TOTAL	1501.829	1606.628

NOTES :

Term loan from bank

ii) Rupee Term loan from Canara Bank - Kolkata, Oriental Bank of Commerce – Kolkata and State Bank of Patiala – Mumbai is secured by (a) an equitable mortgage ranking pari passu inter-se by deposit of title deeds of all the immovable properties of the company both present and future, relating to its spinning unit premises at Village : Yavluj, District : Kolhapur, Maharashtra and

(b) by way of hypothecation ranking pari passu inter-se of all movable properties of the company both present and future including movable machineries, spares, tools & accessories (save & except book debts) subject to prior charges created

or to be created in favour of the Company’s Bankers, on its stock of Raw Materials, finished goods, consumable stores, book debts & such other movables as may be specifically permitted by the institutions in writing, to secure borrowings for working capital requirements and

(c) Personal guarantee of some of the Directors of the Company.

iii) Working Capital Term Loan from Canara Bank, Overseas Branch, Kolkata is secured by way of :

(a) hypothecation of stock of Raw materials, Work-in-process, finished goods and book debts relating to spinning unit at Village : Yavluj, District : Kolhapur, Maharashtra and stock-in-trade at trading unit Kolkata,

(b) Second charge on immovable properties of the company relating to above mentioned spinning unit, and

(c) Personal guarantee of some of the Directors of the Company.

iv) For the above loan a securitisation agreement entered in between the Company, AXIS Bank Limited and the above lenders.

Working capital loans from bank

i) Working Capital Loan from Canara Bank, Overseas Branch, Kolkata & Mumbai , Oriental Bank of Commerce, Overseas Branch, Kolkata, Allahabad Bank, Industrial Finance Branch, Kolkata, State Bank of Patiala - Commercial Branch, Mumbai and ICICI Bank Limited, Kolkata are secured by way of :

(a) First charge by way of hypothecation of stock of Raw materials, Work-in-process, finished goods and book debts relating to spinning unit at Village : Yavluj, District : Kolhapur, Maharashtra and stock-in-trade at trading unit Kolkata, both present and future in a form and manner satisfactory to the bank, ranking pari pasu with each other participating working capital banks.

(b) Second charge on all the fixed assets of the company, both present and future ranking pari pasu with each other participating working capital banks.

(c) Personal guarantee of some of the Directors of the Company.

ii) Previous Year working Capital Loan includes working capital loan from ING Vysya Bank Limited, Overseas Branch, Mumbai was secured by way of :

(a) hypothecation of stock of raw materials, work in process, Finished goods, book debts relating to spinning unit at Village : Yavluj, District : Kolhapur, Maharashtra and

(b) second charge on immovable Properties of the Company relating to above mentioned spinning unit and

(c) Personal guarantee of some of the Directors of the Company.

Banking Relations :	--
Auditors :
Name :	Das and Prasad Chartered Accountant
Address :	4, Chowringhee Lane, Kolkata – 700001, West Bengal, India
Associates/Subsidiaries :	· Nagreeka Capital and Infrastructure Limited · Nagreeka Foils Limited · Nagreeka Synthetics Private Limited

CAPITAL STRUCTURE

AS ON 31.03.2012

Authorised Capital :

No. of Shares	Type	Value	Amount
30000000	Equity Shares	Rs.5/- each	Rs.150.000 Millions

Issued Capital :

No. of Shares	Type	Value	Amount
12510000	Equity Shares	Rs.5/- each	Rs.62.550 Millions

Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
12499700	Equity Shares	Rs.5/- each	Rs.62.498 Millions
	Add : 10300 Equity Forfeited Shares		Rs.0.052 Million
	TOTAL		Rs.62.550 Million

Reconciliation of number of Equity Shares and amount outstanding

Particulars	Numbers	Rs. In Millions
Shares Outstanding at April 1, 2011	12499700	62.498
Shares Outstanding at March 31, 2012	12499700	62.498

The details of Shareholders holding more than 5% shares

Name of the Share Holder	Numbers	Percentage
Agarwal Galvanishing Private Limited	675600	5.40%
Mala Patwari	891700	7.13%
Sunil Patwari	712000	5.70%
Nagreeka Synthetics Private Limited	940270	7.52%

The Company has one class of equity share having a par value of Rs. 5 per share. Each shareholder is eligible for one vote per share held.

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		62.550	62.550	62.550
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		798.123	776.393	722.117
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		860.673	838.943	784.667
LOAN FUNDS
1] Secured Loans		1501.829	1606.638	1258.379
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		1573.829	1606.638	1258.379
DEFERRED TAX LIABILITIES		149.776	153.012	132.096
TOTAL		2512.278	2598.593	2175.142
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		833.632	871.192	868.662
Capital work-in-progress		129.445	10.761	16.192
INVESTMENT		142.344	142.344	202.344
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	913.332	913.380	680.770
	Sundry Debtors	150.117	419.330	233.741
	Cash & Bank Balances	54.124	37.978	7.992
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	541.407	541.418	431.170
Total Current Assets		1658.980	1912.106	1353.673
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	126.599	170.918	93.608
	Other Current Liabilities	115.586	136.374	167.645
	Provisions	9.938	30.518	4.475
Total Current Liabilities		252.123	337.810	265.728
Net Current Assets		1406.857	1574.296	187.945
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		2512.278	2598.593	2175.142

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2012	31.03.2011	31.03.2010
	SALES
		Income	4956.705	5583.502	4145.543
		Other Income	18.620	9.661	4.833
		TOTAL (A)	4975.325	5593.163	4150.376
Less	EXPENSES
		Cost of Material Consumed	1489.645	1406.250
		Purchase of Traded Goods	2856.136	3401.410
		Change in inventories of Finished Goods,	(279.053)	(214.480)
		Stock in Process and Stock in Trade	109.901	94.223
		Employees Benefit Expenses	543.159	606.810
		Other Expenses
		TOTAL (B)	4719.788	5294.213	3952.460
Less	PROFIT / (LOSS) BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		255.537	298.949	197.916
Less	FINANCIAL EXPENSES (D)		174.303	122.232	111.342
	PROFIT / (LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		81.234	176.718	86.574
Less/ Add	DEPRECIATION/ AMORTISATION (F)		69.236	66.535	65.637
	PROFIT / (LOSS) BEFORE TAX (E-F) (G)		11.998	110.183	20.937
Add	TAX (H)		9.732	48.620	1.542
	PROFIT / (LOSS) AFTER TAX (G-H) (I)		21.730	61.563	19.395
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		79.926	25.651	6.256
Less	APPROPRIATIONS
		Proposed Dividend	0.000	6.250	0.000
		Distribution Tax thereon	0.000	1.038	0.000
	BALANCE CARRIED TO THE B/S		101.656	79.926	25.651
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	4172.508	4574.745	3196.352
	IMPORTS
		Stores & Spares	N.A	1.964	5.988
			N.A	40.046	7.872
	TOTAL IMPORTS		N.A	42.010	13.860
	Earnings Per Share (Rs.)		1.74	4.93	1.55

QUARTERLY RESULTS

PARTICULARS	30.06.2012	30.09.2012
	1^st Quarter	2^nd Quarter
Net Sales	1672.960	1158.86
Total Expenditure	1575.840	1081.400
PBIDT (Excl OI)	97.120	77.460
Other Income	0.490	1.170
Operating Profit	97.610	78.630
Interest	64.04	44.670
Exceptional Items	0.000	0.000
PBDT	33.570	33.960
Depreciation	17.330	17.430
Profit Before Tax	16.240	16.530
Tax	0.000	0.000
Provisions and contingencies	0.000	0.000
Profit After Tax	16.240	16.530
Extraordinary Items	0.000	0.000
Prior Period Expenses	0.000	0.000
Other Adjustments	0.000	0.000
Net Profit	16.240	16.530

KEY RATIOS

PARTICULARS		31.03.2012	31.03.2011	31.03.2010
PAT / Total Income	(%)	0.44	1.10	0.47
Net Profit Margin (PBT/Sales)	(%)	0.24	1.97	0.51
Return on Total Assets (PBT/Total Assets}	(%)	0.48	3.96	0.94
Return on Investment (ROI) (PBT/Networth)		0.01	0.13	0.03
Debt Equity Ratio (Total Liability/Networth)		2.12	2.32	1.94
Current Ratio (Current Asset/Current Liability)		6.58	5.66	5.09

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	Yes
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

COMPANY OVERVIEW:

The company was incorporated on 6th March,1989 under the laws of republic of India and has its registered office at Kolkata, West Bengal. The company is engaged in manufacturing and export of cotton yarn and other various merchandise. The shares of the company are listed in National stock exchange and Bombay stock exchange. Company has set up 100%export oriented unit with the state of art, Plant with export capacity of 55440 spindles at Kolhapur in Maharashtra. The Company was also awarded International standard organization certificate for export performance. The Company’s marketing network is spread over in various countries. The Company also doing trading in export of cotton yarn and various commodities. The Company is merchant exporter also. The Company has taken up for setting of yarn dyeing and cotton bleaching plant at Kolhapur.

REVIEW OF OPERATIONS:

During the financial year the company has achieved turnover of Rs 4956.705 million against Rs.5583.502 millions for the previous year. The profit after tax is also lower at Rs.21.730millions against profit after tax of Rs. 61.563 millions in the previous year. The changes in government, policy with regard to export of cotton and cotton yarn which occurred between January-March 2011 had tremendous effect on the entire cotton yarn spinning industry. The ban on export of cotton yam between January -March, 2011, resulted in increase of cotton yarn inventory with spinners. Simultaneously the effect of fluctuating policy for export of raw cotton resulted in prices of raw cotton shooting up between January - March 2011 and thereafter crashing within a very short time in the month of April and May, 2011 by nearly 50% of peak levels. This crash of raw material prices resulted in huge value loss on the inventory on raw material with spinners. This drop in prices together with the rush to liquidate stock of cotton yarn during April - May,2011 also brought down prices of cotton yarn by approx. 30-40%resulting in huge loss in finished goods inventors. This double whammy on raw material and finished goods significantly eroded the capital of the spinning industry. Your company also suffered on account of these events.

Additionally the economic crisis in the euro zone resulted in a recession in demand in Europe for textile products. The Global event also increased volatility in commodity markets and currency markets which was reflected in wide fluctuations in USD / INR exchange rates.

The cost of power has been continuously increasing during the year. The cost has increased by nearly 15%. Interest rates in the Indian economy have also been going up and during this year there was an increase ofapprox.1.25% per annum in the base rate. The cost of working capital borrowing also increased significantly. Rising inflation also resulted in increase of other inputs and costs.

The company has taken on all challenges and after putting in best efforts we have been able to mitigate the effects of these negative developments to achieve results mentioned above.

FUTURE PROSPECT

The future prospects of the company are closely linked with the fortunes of the cotton textile industry. The consumption of cotton textile within India will still grow, although at a slower rate in view of the reduced growth rate of GDP (6.5%). The depreciation of Indian rupee has also improved India's competitiveness in the export market vis-a-vis China, Bangladesh etc. Further as and when the situation of US & Europe improves there should be also increase in business from these countries.

The fortunes of the cotton textile industry depends lot on the availability of quality cotton at competitive prices. The current state of the rnonsoon in India has created some uncertainty on this account and the actual effect will be known only when the new cotton season starts during October/November, 2012.

The restructured TUF Scheme has been announced with greater focus on technical textile while maintaining incentives for traditional sector Additionally, the Maharashtra Government has announced new textile policy offering interest subsidy and capital subsidy in some location in addition to TUF.

The company is in advanced stage of implementing the cotton yarn dyeing and bleaching project at Kagal, Kolhapur at a project cost of Rs.0.730 millions. The project will be operational during quarter January to March 2013. Further, the company is working on projects to increase spinning capacity and enter into weaving activity.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

INDUSTRY STRUCTURE AND DEVELOPMENT:

The textile industry contributes 4% to GDP, 14% to industrial production and 11% to exports of Indian in addition to employing350.000 Millions people directly. India is 2nd largest producer and exporter of raw cotton in the world and the largest producer and largest exporter of cotton yarn in the world. The importance of the textile industry in the Indian economy is thus clear.

The Govt. of India has promoted capacity creation and modernization in the industry vide the TUF. Different incentives are offered to different segments from cotton ginning, spinning ,weaving, processing, garmenting etc. Now, special focus is on Technical Textiles. The economic growth is also boosting the per capita consumption

of textiles in India.

The performance and fortunes of the cotton textile industry are very dependent on the availability of adequate cotton of good quality at competitive prices.

OUTLOOK :

There are dark clouds in form of crisis in Euro Zone and US, slow down in China and India. But, these must give way to a new dawn and this is the hope for the industry and economy.

CONTINGENT LIABILITIES (As on 31.03.2012)

Contingent Liabilities not provided for in respect of

I Bills discounted with Banks Rs. 419.976 millions (Previous Year Rs. 591.849 millions)

II Bank Guarantees of Rs. 37.137 millions (Previous Year Rs. 34.170 millions) issued in favour of Custom, Central Excise and Other Government Authorities.

III Disputed Statutory Dues :-

a) The Income Tax Assessment of the Company have been completed up to Assessment Year 2009-2010. Disputed Income Tax Liabilities for which appeal is pending before different appellate authorities for Assessment Year 2000-2001, 2005-2006, 2006-2007 and 2008-2009 are Rs. 32.878 millions.

b)Disputed Central Excise liability for which appeal is pending before different excise authorities relating to financial year from 2005-2006 is Rs. 2.713 millions.

c ) Disputed Central Service Tax liability for which appeal is pending before different Service Tax authorities relating to financial year from 2004-2005, 2005-2006 and 2009-2010 is Rs. 2.515 millions.

Based on the decision of the Appellate authorities and the interpretations of the other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made

FIXED ASSETS

· Land and Site Development

· Land (Leasehold)

· Office Premises

· Factory Building

· Godown

· Plant and Machinery

· Furniture and Fixtures

· Air Conditioner

· Vehicles

· Computer

· Office Equipments

· Non Factory Building

· Refrigerator

· Old Machine in Hand

CMT REPORT (Corruption, Money Laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

6] Records on Int’l Anti-Money Laundering Laws/Standards :

Charges or investigation registered against subject: None

7] Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

8] Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

9] Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

CONTRAVENTION

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.53.51
UK Pound	1	Rs.84.85
Euro	1	Rs.71.43

INFORMATION DETAILS

Report Prepared by :

HET

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	4
PAID-UP CAPITAL	1~10	4
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	5
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	5
--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	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		42

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.