MIRA INFORM REPORT

Report Date :

08.06.2013

IDENTIFICATION DETAILS

Name :	SMRUTHI ORGANICS LIMITED
Registered Office :	165-A Balaji Bhavan, 1^st Floor, Railway Lines, Solapur-413001, Maharashtra
Country :	India
Financials (as on) :	31.03.2012
Date of Incorporation :	11.07.1989
Com. Reg. No.:	11-052562
Capital Investment / Paid-up Capital :	Rs.38.154 Millions
CIN No.: [Company Identification No.]	L24119PN1989PLC052562
TAN No.: [Tax Deduction & Collection Account No.]	PNES10689A
PAN No.: [Permanent Account No.]	AACCS5562Q
Legal Form :	A public limited liability company. The company’s shares are listed on Stock Exchanges
Line of Business :	Manufacturing and selling Bulk Drugs and Intermediates, Fine chemicals (APls).
No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

Ba (47)

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

Maximum Credit Limit :	USD 1430000
Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject is an established company having a satisfactory track record. 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 condition.

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

EXTERNAL AGENCY RATING

Rating Agency Name	Term loan
Rating	BBB (CRISIL)
Rating Explanation	Having Moderate degree of safety regarding timely servicing of financial obligation. It carry moderate credit risk.
Date	August 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 :	165-A Balaji Bhavan, 1^st Floor, Railway Lines, Solapur-413001, Maharashtra, India
Tel. No.:	91-217-2310268 / 2620367 / 2310267
Fax No.:	91-217-2601112 / 2620268 / 2310268
E-Mail :	info@smruthiorganics.com spr-smruthi2@sancharnet.in
Website :	www.smruthiorganics.com
Head Office :	108, Shivshakti Apartments, B-Wing, G. D. Ambedkar Road, Mumbai – 400 012, Maharashtra
Tel. No.:	91-22-2412 9211 / 2412 9442
Fax No.:	91-22-2415 5452
E-Mail :	solbby@bom5.vsnl.net.in
Factory 1 :	Plot No. 273/274, M.I.D.C., Akkalkot Road, Solapur – 413 006, Maharashtra, India
Tel. No.:	91-217-2651264 / 2653016
Factory 2 :	Plot No. A-27, M.I.D.C. Area, Chincholi, Post Kondi, Taluka Mohol, District Solapur, Maharashtra, INDIA
Tel. No.:	91-217-2257491 /92 / 93 / 94

DIRECTORS

As on 31.03.2012

Name :	Mr. E. Purushotham
Designation :	Chairman and Managing Director
Date of Birth/Age :	55 Years
Qualification :	M.Sc (Org. Chem)
Experience :	9 Years
Name :	Mrs. E. Swapnil
Designation :	Director (Business Development)
Qualification :	B.S. Chemical Engineering
Name :	Mrs. E. Vaishnavi
Designation :	Director
Name :	Mr. Nagender Yerram
Designation :	Director
Name :	Dr. K. Rama Swamy
Designation :	Director
Date of Appointment :	09.05.2012
Name :	Mr. J. H. Ranade
Designation :	Director

SHAREHOLDING PATTERN

As on 31.03.2013

Names of Shareholders	No. of Shares	Percentage of Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	2,129,010	55.80
Bodies Corporate	82,000	2.15
Any Others (Specify)	240,581	6.31
Directors/Promoters & their Relatives & Friends	240,581	6.31
Sub Total	2,451,591	64.25
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	2,451,591	64.25
(B) Public Shareholding
(1) Institutions
(2) Non-Institutions
Bodies Corporate	171,125	4.49
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 million	797,880	20.91
Individual shareholders holding nominal share capital in excess of Rs. 0.100 million	323,089	8.47
Any Others (Specify)	71,745	1.88
Clearing Members	575	0.02
Non Resident Indians	71,170	1.87
Sub Total	1,363,839	35.75
Total Public shareholding (B)	1,363,839	34.75
Total (A)+(B)	3,815,430	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	0	0
(1) Promoter and Promoter Group	0	0
(2) Public	0	0
Sub Total	0	0
Total (A)+(B)+(C)	3,815,430	0

BUSINESS DETAILS

Line of Business :

Manufacturing and selling Bulk Drugs and Intermediates, Fine chemicals (APls).

Products :

Product Description	ITC Code
Diloxanide Furoate	2942.00
Norfloxacin	2942.00
Ciprofloxacin	2942.00
Pefloxacin	2942.00
Metformin HCL	2942.00
Amlodipine	2942.00
Chlorhexidine Base	2942.00
Zidouvdine	2942.00
Carbidopa	2942.00
Enrofloxacin	2942.00
Phthaloyl Amlodipine	2942.00

GENERAL INFORMATION

No. of Employees :

Not Available

Bankers :

• State Bank of India - Industrial Finance Branch, World Trade Centre, Mumbai - 400 005, Maharashtra, India
• State Bank of India - Station Road Branch, Solapur - 413 001, Maharashtra, India
• Axis Bank Limited – Baner Branch, Pune, Maharashtra, India

Facilities :

Secured Loan	31.03.2012 (Rs. in Millions)	31.03.2011 (Rs. in Millions)
Axis Bank Term Loan	47.361	0.000
Deferral Sales Tax Loan PSI 1993 Scheme	32.237	39.375
Deferral Sales Tax Loan PSI 1993 Expansion	35.515	35.515
Axis Bank Limited- Car Loan	2.100	2.418
Working Capital Loan from S.B.I.,IFB Mumbai and Solapur	175.658	179.514
SBI Global Factors Limited, Mumbai	(0.097)	9.204
Total	292.774	266.026

Notes:

1st mortgage / hypothecation charge on pari-passu basis with Axis Bank on Land and building and Plant and Machinery owened by the Company situated at Plot No.273 and 274 MIDC,Akkalkot Road, Solapur 413006 and Plot No.A-27, MIDC Chincholi, Solapur- 413 255, First Mortgage Charge on Company 's - Flat No 5, Rahul Neha Apartment Solapur , Flat No T/1 , Balaji Apt. Solapur,Holiday Resaurt at Plot No 31, Nakoda Constr. at village. Pakani Solapur. First pari- passu charges on the above assest for Term Loan of Rs.157.500 Millions form Axis Bank Pune. The Term Loan of Axis Bank Rs 157.500 Millions is repayable in 60 months equal installment along with interest from 01.01.2013

Personal guarantee of Mr E Purushotham, Managing Director and Mrs. E Vaishnavi Director.

Deferred Sales Tax Loan is interest free and payable in yearly in 5 installment of each Financial years after completion of 10 years and the final installment will due on 01.05.2022

1st registered mortgage / hypothecation charge with State Bank of India on lease hold land and building and Plant and Machinery owened by the Company situated at Plot No.273 and 274 MIDC,Akkalkot Road, Solapur 413006 and Plot No.A-27, MIDC Chincholi, Solapur- 413 255 and Flat No 5, Rahul Neha Apt. Solapur , Flat No T/1 , Balaji Apt. Solapur,Holiday Resaurt at Plot No 31, Nakoda Constr. at village. Pakani Solapur. IInd charge on entire current assets of Company pari-passu basis to Axis Bank, Pune.

Banking Relations :	--
Auditors :
Name :	Ashok Madgundi and Company Chartered Accountant
Address :	210/ A/ 1, Sakhar Peth, Near Kanya Prashala, Solapur-413005, Maharashtra, India
Tel. No.:	91-217-626540 / 620403

CAPITAL STRUCTURE

As on 30.07.2012

Authorised Capital :

No. of Shares	Type	Value	Amount
5000000	Equity Shares	Rs.10/- each	Rs.50.000 Millions
5000000	Non-Convertible Cumulative Redeemable Preference Shares	Rs. 10/- each	Rs. 50.000 Millions
	Total		Rs.100.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
3815430	Equity Shares	Rs.10/- each	Rs.38.154 Millions

[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		38.154	38.154	38.154
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		319.556	226.089	136.923
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		357.710	264.243	175.077
LOAN FUNDS
1] Secured Loans		292.774	266.026	189.571
2] Unsecured Loans		28.026	31.747	107.969
TOTAL BORROWING		320.800	297.773	297.540
DEFERRED TAX LIABILITIES		28.497	28.197	21.746
TOTAL		707.007	590.213	494.363
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		323.689	318.648	280.163
Capital work-in-progress		43.772	3.062	2.432
INVESTMENT		0.997	0.997	0.000
DEFERRED TAX ASSETS		0.000	0.840	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	317.321	310.290	315.842
	Sundry Debtors	368.085	238.197	159.899
	Cash & Bank Balances	21.086	17.045	23.255
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	103.902	93.574	64.999
Total Current Assets		810.394	659.106	563.995
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	367.481	309.273	306.075
	Other Current Liabilities	37.232	39.348	0.000
	Provisions	67.132	43.819	48.663
Total Current Liabilities		471.845	392.440	354.738
Net Current Assets		338.549	266.666	209.257
MISCELLANEOUS EXPENSES		0.000	0.000	2.511
TOTAL		707.007	590.213	494.363

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2012	31.03.2011	31.03.2010
	SALES
		Income	2051.581	1573.432
		Other Income	2.191	2.303
		TOTAL (A)	2053.772	1575.735	1269.782
Less	EXPENSES
		Cost of materials consumed	1537.094	1134.243
		Changes in inventories of finished goods, work-in-progress and Stock-in-Trade	3.502	32.940
		Employee benefits expenses	91.991	76.413
		Other expenses	161.443	111.953
		TOTAL (B)	1794.030	1355.549	1116.211
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		259.742	220.186	153.571
Less	FINANCIAL EXPENSES (D)		54.008	44.251	42.770
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		205.734	175.935	110.801
Less/ Add	DEPRECIATION/ AMORTISATION (F)		45.296	39.817	38.252
	PROFIT BEFORE TAX (E-F) (G)		160.438	136.118	72.549
Less	TAX (I)		54.040	39.110	17.058
	PROFIT AFTER TAX (G-I) (J)		106.399	97.008	55.491
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		188.740	109.274	68.259
Less	TRANSFER TO GENERAL RESERVE		10.640	9.700	5.549
Less	DIVIDEND AND TAX FOR THE YEAR		13.392	11.160	8.928
Less	INCOME TAX 09-10 AND 10-11		0.631	0.000	0.000
Add	INCOME-TAX REFUND AS PER COMPUTATION (AY 09-10)		0.916	1.170	0.000
Add	MAT SET-OFF (AY 09-10)		0.000	1.854	0.000
Add	EXCESS PROVISION		0.173	0.294	0.000
	BALANCE CARRIED TO THE B/S		271.565	188.740	109.273
	EARNINGS IN FOREIGN CURRENCY (EXPORT AT FOB VALUE)		461.820	290.648	257.394
	Earnings Per Share (Rs.)		27.89	25.43	14.60

QUARTERLY RESULTS

PARTICULARS	30.06.2012 (Unaudited)	30.09.2012 (Unaudited)	31.12.2012 (Unaudited)	31.03.2013 (Unaudited)
	1^st Quarter	2nd Quarter	3rd Quarter	4rd Quarter
Net sales	580.600	545.400	594.400	180.200
Total Expenditure	510.300	473.700	443.900	189.300
Profit before interest, depreciation and tax	70.200	71.700	50.500	(09.000)
Other income	6.400	0.000	4.000	0.100
Operating Profit	76.600	71.700	54.500	(8.900)
Interest	9.600	7.600	12.500	10.500
Profit before depreciation and tax	67.000	64.100	42.000	(19.400)
Depreciation	11.900	13.900	14.300	12.800
Profit before tax	55.100	50.300	27.700	(32.300)
Tax	15.600	20.800	11.500	(10.600)
Profit after tax	39.500	29.500	16.200	(21.700)
Extraordinary items	0.000	0.000	0.000	0.000
Prior period expenses	0.000	0.000	0.000	0.000
Other adjustments	0.000	0.000	0.000	0.000
Net Profit	39.500	29.500	16.200	(21.700)

KEY RATIOS

PARTICULARS		31.03.2012	31.03.2011	31.03.2010
PAT / Total Income	(%)	5.18	6.16	4.37
Net Profit Margin (PBT/Sales)	(%)	7.82	8.65	NA
Return on Total Assets (PBT/Total Assets}	(%)	14.15	13.92	21.02
Return on Investment (ROI) (PBT/Networth)		0.45	0.52	0.41
Debt Equity Ratio (Total Debts/Networth)		0.90	1.13	1.70
Current Ratio (Current Asset/Current Liability)		1.72	1.68	1.59

LOCAL AGENCY FURTHER INFORMATION

Sr. No.	Check List by Info Agents	Available in Report (Yes / No)
1]	Year of Establishment	Yes
2]	Locality of the firm	Yes
3]	Constitutions of the firm	Yes
4]	Premises details	No
5]	Type of Business	Yes
6]	Line of Business	Yes
7]	Promoter's background	Yes
8]	No. of employees	No
9]	Name of person contacted	No
10]	Designation of contact person	No
11]	Turnover of firm for last three years	Yes
12]	Profitability for last three years	Yes
13]	Reasons for variation <> 20%	----
14]	Estimation for coming financial year	No
15]	Capital in the business	Yes
16]	Details of sister concerns	No
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	No

UNSECURED LOAN:

Particulars	31.03.2011 (Rs. in Millions)	31.03.2010 (Rs. in Millions)
Directors	28.026	29.297
Inter Corporate Deposit	0.000	2.450
Total	28.026	31.747

CORPORATE INFORMATION:

Smruthi Organics Limited is a public Company domiciled in Indian and incorporate under the provisions of the Companies Act, 1956. It' s shares are listed on Stock Exchange of Pune, Hyderabad, Ahmedabad and Mumbai as permitted by security in India. The Company is engaged in the manufacturing and selling Bulk Drugs and Intermediates, Fine chemicals (APIs). The Company caters to both domestic and international market.

FUTURE OUTLOOK:

In the short to medium term, the Company will focus on expanding sales of its existing products. The commencement of operations of new Metformin Hydrochloride facility this August will allow the Company increases its sales for the second half of the fiscal year. The total capacity of Metformin Hydrochloride will be 5000 MT per annum. The Company is in advanced stage of securing business to sell its entire capacity with several new customers overseas. In addition, the Company is also looking to expand its footprint in existing markets such as EU and USA, while adding new markets such as Latin America and South East Asia in order to increase sales. The Company is in various stages of business development towards achieving these goals.

The Company has posted excellent results showing all round increase in sales turnover, production and profitability.

a) Sales: - The Gross Sales for the year amounted to Rs. 2106.200 Millions as against Rs. 1622.900 Millions for

the previous year, showing increase of 30%. The production quantity for the year showing increase of 1938 MTs as against 1437 MTs in the previous year showing increase of 35% .

b) Exports: Exports for the year stood at Rs.461.800 Millions as compared to Rs. 290.600 Millions for the year ended on 31st March 2011. The Company has registered an increase of 59% compared to the previous year.

c) Profits :- Despite increase in Raw material cost and other overheads, Company could register growth of 17.87 % and 9.68% in Profit before and after tax respectively over the previous year. Directors hope that with ongoing expansion project expected to be commissioned by July 2012, Company shall be able to register substantial growth in production, turnover and profits. Additional capacity shall considerably go to reduce the lead time for delivering new products and also supply the existing products on much larger scale.

FIXED ASSETS:

• Factory Land
• Agricultural Land
• Building
• Ownership Flats
• Plant and Machinery
• Electrical Installation/ Equipments
• Vehicles
• Office Equipments
• Computer
• Furniture and Fixture
• Laboratory Equipments
• Other Factory Equipments

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.56.74
UK Pound	1	Rs.88.53
Euro	1	Rs.75.20

INFORMATION DETAILS

Report Prepared by :

AHN

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	5
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	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	Yes
--AFFILIATION	YES/NO	Yes
--LISTED	YES/NO	Yes
--OTHER MERIT FACTORS	YES/NO	Yes
DEFAULTER
--RBI	YES/NO	No
--EPF	YES/NO	No
TOTAL		47

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.