MIRA INFORM REPORT

Report Date :

25.01.2013

IDENTIFICATION DETAILS

Name :	WELSPUN STEEL LIMITED (w.e.f.26.05.2010)
Formerly Known As :	WELSPUN POWER AND STEEL LIMITED
Registered Office :	S N 650 Village Varsamedi Taluka Anjar, District Kutch - 370110, Gujarat
Country :	India
Financials (as on) :	31.03.2012 (Profit and Loss Account)
Date of Incorporation :	03.06.2004
Com. Reg. No.:	04-044249
Capital Investment / Paid-up Capital :	Rs. 590.960 Millions (As on 30.09.2011)
CIN No.: [Company Identification No.]	U27109GJ2004PLC044249
TAN No.: [Tax Deduction & Collection Account No.]	RKTW00058C
PAN No.: [Permanent Account No.]	AAACW5308G
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturer of Sponge Iron, Ingots, Billets and TMT Bars.
No. of Employees :	Information Denied By Management

RATING & COMMENTS

MIRA’s Rating :

Ba (51)

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

Maximum Credit Limit :	USD 30000000
Status :	Regular
Payment Behaviour :	Clear
Litigation :	Clear
Comments :	Subject is an established company having good track record. Financial position of the company appears to be sound. Trade relations are reported as trustworthy. Business is active. Payments are reported to be regular and as per commitments. The company can be considered good for business dealings at usual trade terms and conditions. Subject has changed its accounting year. Latest financials are for the period from October 2011 to March 2012.

NOTES :

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

INDIAN ECONOMIC OVERVIEW

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

Source : CIA

EXTERNAL AGENCY RATING

Rating Agency Name	CARE
Rating	BBB (Long Terms NCD)
Rating Explanation	Moderate credit risk
Date	13.06.2012

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.

INFORMATION DENIED

Management Non Co-Operative (91-22-6613600)

LOCATIONS

Registered Office :	S N 650 Village Varsamedi Taluka Anjar, District Kutch - 370110, Gujarat
Tel. No.:	91-2836-279051/53/54/55/56
Fax No.:	91-2836-279050
E-Mail :	secretariallegal@welspun.com dilip_chokhra@welspun.com wpslanjar_gov@welspun.com rashmi_mamtura@welspun.com
Website :	www.welspunsteel.com
Corporate Office :	Welspun House, 7^th Floor, Kamala Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai-400013, Maharashtra, India.
Tel. No.:	91-22-66136000
Fax No.:	91-22-24908020
Branch 1 :	23 HIG, BDA Housing Complex, Gangadhar Meher Nagar, Jayadev Vihar, Bhubaneshwar-751013, Orissa, India
Tel. No.:	91-674-2300223
Fax No.:	91-674-2300224
Branch 2:	GIDC Industrial Estate, Valia Road, Jagadia, District Bharuch, Gujurat, India
Tel. No.:	91-2645-226305/6/7
Fax No.:	91-2645-220403

DIRECTORS

As on: 29.09.2012

Name :	Mr. Sitaram Damodardas Somani
Designation :	Director
Address :	N-8/18 Ganpati Niwas, Bangur Niwas Building, Goregaon (West), Mumbai - 400090, Maharashtra, India.
Date of Birth/Age :	23.01.1948
Qualification :	C.A
Date of Appointment :	22.03.2006
DIN No.:	00005017
Name :	Mr. Rajesh Rameshkumar Mandawewala
Designation :	Director
Address :	161/171-B, Opposite Sidhivinayak Temple, Tanna Residency, Prabhadevi, Mumbai - 400025, Maharashtra, India
Date of Birth/Age :	05.05.1962
Qualification :	F.C.A
Date of Appointment :	01.09.2006
DIN No.:	00007179
Name :	Mr. Atul Manubhai Desai
Designation :	Director
Address :	C/62, Vellard View, 14, Tardeo Road, Haji Ali, Mumbai – 400034, Maharashtra, India
Date of Birth/Age :	21.01.1950
Date of Appointment :	29.09.2012
DIN No.:	00019443
Name :	Mr. Ram Gopal Sharma
Designation :	Director
Address :	E-707, Military Road, Off Marol Maroshi Road, Lok Sarita Building, Andheri (East), Mumbai - 400059, Maharashtra, India
Date of Birth/Age :	11.09.1940
Qualification :	B.com, M.A (Economics)
Date of Appointment :	10.05.2006
DIN No.:	00026514
Name :	Mr. Balkrishan Gopiram Goenka
Designation :	Director
Address :	Rocky Isle 46/C, Bhulabhai Desai Road, Breach Candy, Mumbai - 400026, Maharashtra, India
Date of Birth/Age :	15.08.1965
Qualification :	B. Com
Date of Appointment :	03.06.2004
DIN No.:	00270175
Name :	Mr. Vijay Singh Bapna
Designation :	Whole Time Director
Address :	5^th Floor, Room No. 503, Sir Pochkhanwala Road, Purna 68-A, Worli, Mumbai - 400025, Maharashtra, India
Date of Birth/Age :	28.08.1948
Qualification :	M.Com, C.A
Date of Appointment :	01.04.2011
DIN No.:	02599024
Name :	Mr. Anuj Burakia
Designation :	Director
Address :	B-108, NU-10B, Shakti Nagar, Gandhidham – 370201, Gujarat, India
Date of Birth/Age :	27.06.1979
Qualification :	C.A
Date of Appointment :	28.12.2011
DIN No.:	02840211

KEY EXECUTIVES

Name :	Ms. Rashmi Donesh Mamatura
Designation :	Secretary
Address :	B-2, Ekvira Niwas, Bhnadar Wada, Pannalal Ghosh Marg, Mumbai – 400064, Maharashtra, India
Date of Birth/Age :	23.01.1987
Date of Appointment :	31.10.2011

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on: 29.09.2012

Names of Shareholders	No. of Shares
Krishiraj Trading Limited	54350100
Welspun Finance Limited	10000
Welspun Mercantile Limited	6659600
Welspun Fintrade Limited	40950000
Welspun Wintex Limited	2120000
Goldenarch Estates Private Limited	1000000
Welspun Investments and Commercials	5000000
Welspun Zucchi Textiles Limited	100
Welspun Syntex Limited	100
Welspun India Limited	100
Total	110090000

Equity Share Break up (Percentage of Total Equity)

As on: 29.09.2012

Category	Percentage
Bodies corporate	100.00
Total	100.00

BUSINESS DETAILS

Line of Business :	Manufacturer of Sponge Iron, Ingots, Billets and TMT Bars.
Product:	ITC No.:	Product Description
	72-03	Sponge Iron
	72-13	Rolled Products
	72-06	Steel Ingots

GENERAL INFORMATION

No. of Employees :

Information Denied By Management

Bankers :

• Andhra Bank, 16b, 16th Floor, Earnest House, 194, NCPA Marg, Nariman Point, Mumbai - 400021, Maharashtra, India
• Punjab National Bank, IIIaco House, Sir P. M. Road, Fort, Mumbai - 400001, Maharashtra, India.

Facilities :

(Rs. In Millions)

Secured Loan	As on 31.03.2012 (6 Months)	As on 30.09.2011 (18 Months)
Rupee term loans banks secured		(A)2290.601
Foreign currency loans banks secured	NA	(B) 489.750
Working capital loans banks secured		(C) 95.654
Total	NA	2876.005
Note: (A) Including interest accrued and due Rs.0.601 Million (B) Term loans from banks are secured by way of mortgage (first charge) on all movable and immovable properties of the Company, both present and future, ranking pari passu, and are personally guaranteed by a promoter director. Further, the said loans are also secured by second charge on current assets subject to prior charge in favour of working capital facilities. (C) Secured by hypothecation of stocks and book debts of the Company and second charge on entire fixed assets of the Company and further secured by personal guarantee of a promoter director.

Banking Relations :	--
Auditors :
Name :	Suresh Surana and Associates Chartered Accountant Chartered Accountant
Address :	B-301 Mehvish Tower Patel Complex Mira Village Mira Road (East), District Thane Mira Road, Thane– 401104, Maharashtra, India
PAN.:	ABAPV2006L
Subsidiaries : (As on 30.09.2012)	Welspun Maxsteel Limited, India CIN No: U27100GJ2008PLC064145 Welspun Orissa Steel Private Limited, India CIN No: U45400DL2007PTC162485 Welspun Steel Resources Private Limited, India CIN No: U27109GJ2009PTC055893 PT. Batubara Energy Indonesia, Indonesia Welspun Natural Resources (Australia) Pty Limited, Australia
Associate: (As on 30.09.2012)	Remi Metals Gujarat Limited, India CIN No: L27100GJ1993PLC020358 Welspun Captive Power Generation Limited, India CIN No: U40100GJ2010PLC060502
Enterprises which are owned, or have significant influence of or are partners with Key management personnel and their relatives: (As on 30.09.2012)	Welspun India Limited, India CIN No: L17110GJ1985PLC033271 Welspun Corp Limited, India CIN No: L27100GJ1995PLC025609 Welspun Syntex Limited, India CIN No: L99999DN1983PLC000045 Welspun Fintrade Private Limited, India CIN No: U65910GJ1982PTC055383 Welspun Logistics Limited, India CIN No: U63012MH2006PLC165280 Welspun Solar AP Private Limited, India CIN No: U40109MH2008PTC178769 Krishiraj Trading Limited, India CIN No: U65990GJ1992PLC050965 Welspun Enterprises (Cyprus) Limited, Cyprus Red Lebondal Limited, Cyprus Welspun Projects Limited, India CIN No: L45201GJ1994PLC023920

CAPITAL STRUCTURE

As on: 29.09.2012

Authorised Capital :

No. of Shares	Type	Value	Amount
150000000	Equity Shares	Rs.10/- each	Rs. 1500.000 Millions

Issued, Subscribed

No. of Shares	Type	Value	Amount
125500000	Equity Shares	Rs.10/- each	Rs. 1255.000 Millions

Paid-up Capital :

No. of Shares	Type	Value	Amount
25100000	1 Equity Shares	Rs.10/- each	Rs. 251.000 Millions
84990000	2 Equity Shares	Rs.4/- each	Rs. 339.960 Millions
	Total		Rs. 590.960 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		30.09.2011 (18 Months)	31.03.2010 (12 Months)
SHAREHOLDERS FUNDS
1] Share Capital		590.960	251.000
2] Share Application Money		450.000	0.000
3] Reserves & Surplus		6693.669	1549.791
4] (Accumulated Losses)		0.000	0.000
NETWORTH		7734.629	1800.791
LOAN FUNDS
1] Secured Loans		2876.005	466.534
2] Unsecured Loans		0.000	3565.302
TOTAL BORROWING		2876.005	4031.836
DEFERRED TAX LIABILITIES		0.000	22.311
TOTAL		10610.634	5854.938
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		1262.666	1256.154
Capital work-in-progress		1061.158	111.852
INVESTMENT		330.954	3050.196
DEFERREX TAX ASSETS		21.982	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	841.624	584.465
	Sundry Debtors	251.027	277.563
	Cash & Bank Balances	87.222	585.517
	Other Current Assets	15.969	1.910
	Loans & Advances	8935.217	879.449
Total Current Assets		10131.059	2328.904
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	225.761	136.535
	Other Current Liabilities	533.361	574.266
	Provisions	1438.063	181.367
Total Current Liabilities		2197.185	892.168
Net Current Assets		7933.874	1436.736
MISCELLANEOUS EXPENSES		0.000	0.000
TOTAL		10610.634	5854.938

Note: Balance Sheet for the year 2012 is not available, only Profit and Loss Account is available.

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2012 (6 Months)
	SALES
		Income	3034.169
		Other Income	100.615
		TOTAL (A)	3134.784
Less	EXPENSES
		Cost of materials consumed	2257.477
		Changes in inventories of finished goods, work-in-progress and stock-in-trade	127.786
		Employee related expenses	67.049
		Other Expenses	278.531
		TOTAL (B)	2730.843
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		403.941
Less	FINANCIAL EXPENSES (D)		216.272
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		187.669
Less/ Add	DEPRECIATION/ AMORTISATION (F)		53.937
	PROFIT BEFORE TAX (E-F) (G)		133.732
Less	TAX (H)		38.175
	PROFIT AFTER TAX (G-H) (I)		95.557
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		6693.669
	BALANCE CARRIED TO THE B/S		6789.226
	Earnings Per Share (Rs.)		1.62

	PARTICULARS		30.09.2011 (18 Months)	31.03.2010 (12 Months)
	SALES
		Income	5631.355	3216.910
		Other Income	6853.834	202.786
		TOTAL (A)	12485.189	3419.696
Less	EXPENSES
		Consumption materials changes inventories	4574.938	2605.102
		Manufacturing service costs	229.730	98.835
		Contract cost	21.851	12.961
		Employee related expenses	128.806	61.461
		Administrative selling other expenses	767.535	92.301
		TOTAL (B)	5722.860	2870.660
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		6762.329	549.036
Less	FINANCIAL EXPENSES (D)		368.085	212.559
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		6394.244	336.477
Less/ Add	DEPRECIATION/ AMORTISATION (F)		117.627	75.260
	PROFIT BEFORE TAX (E-F) (G)		6276.617	261.217
Less	TAX (H)		1132.739	30.490
	PROFIT AFTER TAX (G-H) (I)		5143.878	230.727
Add	PRIOR PERIOD INCOME / EXPENSES		0.000	0.069
	MAT CREDIT ENTITLEMENT PERTAINING TO EARLIER YEAR		0.000	0.000
	PRIOR YEAR TAX ADJUSTMENT		0.000	0.421
	DEFERRED TAX ASSETS RECOGNIZED RELATING TO EARLIER YEARS		0.000	0.000
				0.000
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		1549.791	1318.574
	BALANCE CARRIED TO THE B/S		6693.669	1549.791
	Earnings Per Share (Rs.)		88.50	4.64

KEY RATIOS

PARTICULARS		31.03.2012 (6 Months)	30.09.2011 (18 Months)	31.03.2010 (12 Months)
PAT / Total Income	(%)	3.05	41.20	6.74
Net Profit Margin (PBT/Sales)	(%)	4.41	111.46	8.12
Return on Total Assets (PBT/Total Assets}	(%)	NA	61.95	11.22
Return on Investment (ROI) (PBT/Networth)		NA	0.81	0.15
Debt Equity Ratio (Total Liability/Networth)		NA	0.66	2.73
Current Ratio (Current Asset/Current Liability)		NA	4.61	2.61

LOCAL AGENCY FURTHER INFORMATION

Sundry Creditors Details:

Rs. In Millions

Particulars	31.03.2012 (6 Months)	30.09.2011 (18 Months)	31.03.2010 (12 Months)
Sundry Creditors
Micro, Small and Medium Enterprise and others	NA	0.000	0.000
Others	NA	225.761	136.535
Total	NA	225.761	136.535

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]	PAN of Proprietor/Partner/Director, if available	No
32]	Date of Birth of Proprietor/Partner/Director, if available	Yes
33]	Voter ID No of Proprietor/Partner/Director, if available	No
34]	External Agency Rating, if available	Yes

BUSINESS OPERATIONS

The stake holders about the successful installation and operation of their new Electric Induction Furnace (40 Tons per heat capacity) and the Continuous Casting machine in Phase I of the project undertaken during the period under review and the resultant direct and indirect benefits the company could get due to its successful commissioning:

In house production of Steel Billets has given the self reliance of the base Raw material required for the production of quality end product i.e. thermo-mechanically treated reinforcement re-bars. It does away with the dependency on varied quality outside supply of billets from external sources.

The Furnace and Caster have thrown open the opportunity to develop newer grades of steel billets which will help in creating new product range and better anticipated returns on investment.

In house Sponge Iron while meets the basic raw material requirement of new Steel Melting Shop (SMS) facility also means desirable utilization of Direct Reduced Iron (DRI) plant for in-house consumption. This ensures better value addition as compared to marketing this basic material in highly volatile market conditions.

Back to back better utilization of in house products and the control on the quality of intermediate products also gives an edge on not only the overall quality of the end products but also opens up the avenue for trials and development of newer end-product range in times to come.

CONTINGENT LIABILITIES

(Rs.In Millions)

Particulars	30.09.2011
Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances)	92.254
Export obligation for duty free imports Rs. Nil (as at 31.03.2010 Rs.34.617 Millions) to be fulfilled during the period of six years (as at 31.03.2010 eight years) from the date of EPCG licenses, failing which the differential custom duty together with interest and penalties, if any levied, may have to be paid	0.000
Bills discounted with bank	282.339
Bank guarantee given to customs authorities for EPCG license	2.306
Bank guarantee given to The Paschim Gujarat Vij Company Limited towards security deposit for electricity supply.	38.378
Corporate guarantee given to a bank for term loan and working capital loan availed by Remi Metals Gujarat Limited, a associates company	3850.000
Corporate guarantee given to a bank for term loan and working capital loan availed by Welspun Maxsteel Limited	16000.000
Corporate guarantee given to a bank for term loan and working capital loan availed by Welspun Captive Power Generation Limited, a associate company	1500.000
Corporate guarantee given to a bank for term loan availed by PT. Batubara Energy Indonesia, a subsidiary company (USD 39.480 Millions)	1933.500
Disputed stamp duty liability	1.050
Disputed sales tax liability	24.002

BANKERS CHARGES REPORT AS PER REGISTRY

Corporate identity number of the company	U27109GJ2004PLC044249
Name of the company	WELSPUN STEEL LIMITED
Address of the registered office or of the principal place of business in India of the company	S N 650 Village Varsamedi Taluka Anjar, District Kutch-370110, Gujarat, India rashmi_mamtura@welspun.com
This form is for	Creation of charge
Type of charge	Book debts Movable property (not being pledge) Floating charge Others
Particular of charge holder	Andhra Bank, 16b, 16th Floor, Earnest House, 194, NCPA Marg, Nariman Point, Mumbai - 400021, Maharashtra, India bmmum1128@andhrabank.co.in
Nature of instrument creating charge	Composite Agreement Executed on 15.12.2012 In Favour of Andhra Bank.
Date of instrument Creating the charge	15.12.2012
Amount secured by the charge	Rs 1050.000 Millions
Brief of the principal terms an conditions and extent and operation of the charge	Rate of interest Base rate (presently 10.50%) +3.25% presently 13.75% p.a. Margin RM/WIP/FG/stores, sares and consumables-25% book debts not older than 90 days- 25% export sales - 10% export receivables - 5% LC- 10% cash margin GB- 10% cash margin Extent and Operation of the charge Hypothecation by way of pari passu first charge over all the borrower's stocks/goods, stores and spares, book debts and all other movable assets
Short particulars of the property or asset(s) charged (including complete address and location of the property)	Entire stock of raw materials, work in progress, finished goods, goods purchased under letter of credits, stores and spares, receivables and all other movable assets

FIXED ASSETS:

• Freehold Land
• Lease Hold Improvement
• Building
• Plant and Machinery
• Officer Equipments
• Furniture and Fixtures
• Vehicle
• Power Plant

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. 53.85
UK Pound	1	Rs. 85.26
Euro	1	Rs. 71.72

INFORMATION DETAILS

Information Gathered by :	PDT
Report Prepared by :	UDS

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	4
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	7
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	6
--CREDIT LINES	1~10	6
--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
TOTAL		51

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.