1. Summary Information

		Country	India
Company Name	KANSAI NEROLAC PAINTS LIMITED	Principal Name 1	Dr. Jamshed Jiji Irani
Status	Excellent	Principal Name 2	Mr. Devendra Motilal Kothari
		Registration #	11-000825
Street Address	Nerolac House, Ganpatrao Kadam Marg, Lower Parel, Mumbai - 400 013, Maharashtra, India
Established Date	02.09.1920	SIC Code	--
Telephone#	91-22-24934001/ 24992500 1	Business Style 1	Manufacturing
Fax #	91-22-24919439	Business Style 2	Marketing
Homepage	http://www.nerolac.com	Product Name 1	Paints
# of employees	2456 (Approximately)	Product Name 2	Varnishes
Paid up capital	Rs.538,920,000/-	Product Name 3	Enamels
Shareholders	Promoter and Promoter Group -69.27% Public shareholding -30.73%	Banking	Union Bank of India
Public Limited Corp.	YES	Business Period	93 Years
IPO	YES	International Ins.	-
Public Enterprise	YES	Rating	Aa (85)
Related Company
Relation	Country	Company Name	CEO
Holding Company	Japan	Kansai Paint Company Limited	--
Note	-

2. Summary Financial Statement

Balance Sheet as of	31.03.2013		(Unit: Indian Rs.)
Assets		Liabilities
Current Assets	5,820,930,000	Current Liabilities	5,541,710,000
Inventories	5,340,730,000	Long-term Liabilities	604,850,000
Fixed Assets	7,744,730,000	Other Liabilities	1,615,910,000
Deferred Assets	0,000	Total Liabilities	7,762,470,000
Invest& other Assets	1,715,880,000	Retained Earnings	12,320,880,000
		Net Worth	12,859,800,000
Total Assets	20,622,270,000	Total Liab. & Equity	20,622,270,000
Total Assets (Previous Year)	16,981,200,000
P/L Statement as of	31.03.2013		(Unit: Indian Rs.)
Sales	28,566,190,000	Net Profit	2,921,820,000
Sales(Previous yr)	26,005,720,000	Net Profit(Prev.yr)	2,158,850,000

MIRA INFORM REPORT

Report Date :

28.06.2013

IDENTIFICATION DETAILS

Name :	KANSAI NEROLAC PAINTS LIMITED (w.e.f. 11.07.2006)
Formerly Known As :	GOODLASS NEROLAC PAINTS LIMITED
Registered Office :	Nerolac House, Ganpatrao Kadam Marg, Lower Parel, Mumbai - 400013, Maharashtra
Country :	India
Financials (as on) :	31.03.2013
Date of Incorporation :	02.09.1920
Com. Reg. No.:	11-000825
Capital Investment / Paid-up Capital :	Rs.538.920 Millions
CIN No.: [Company Identification No.]	L24202MH1920PLC000825
TAN No.: [Tax Deduction & Collection Account No.]	MUMG00234D
PAN No.: [Permanent Account No.]	AAACG1376N
Legal Form :	A Public Limited Liability company. The Company’s Shares are Listed on the Stock Exchanges.
Line of Business :	Manufacturing and Marketing of Paints, Varnishes and Enamels, Oils and Synthetic Resins.
No. of Employees :	2456 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

Aa (85)

RATING		STATUS	PROPOSED CREDIT LINE
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

Maximum Credit Limit :	USD 54130000
Status :	Excellent
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is an old and well established company having an excellent track record. The financial performance of the company is excellent and the networth has also been growing over the year. Profits also show an increasing trend. Trade relations are reported as fair. Business is active. Payment terms are regular. The company can be considered for business dealings on safe and secured 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 – March 31^st, 2013

Country Name	Previous Rating (31.12.2012)	Current Rating (31.03.2013)
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	CRISIL
Rating	AAA (Long Term Rating)
Rating Explanation	Having highest degree of safety regarding timely servicing of financial obligation. It carry low credit risk.
Date	November 29, 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 :

Nerolac House, Ganpatrao Kadam Marg, Lower Parel, Mumbai - 400 013, Maharashtra, India

Tel. No.:

91-22-24934001/ 24992500/ 4992585

Fax No.:

91-22-24919439

E-Mail :

info@nerolac.com

gtqovindaraian@nerolac.com

Website :

http://www.qoodlassnerolac.com

http://www.nerolac.com

Factory 1 :

B1 , B2, Jainpur Industrial Estate, Kanpur Dehat, Kanpur, Uttar Pradesh, India

Factory 2 :

F/2, MIDC, Lote Parshuram, Taluka Khed, District Ratnagiri, Maharashtra, India

Factory 3 :

Bibi Talav Vatva, Ahmadabad, Gujarat, India

Factory 4 :

142, Tiruporur Road, Perungudi, Chennai, Tamilnadu, India

Factory 5 :

36, Sector-7, HSIDC IGS, Bawal, District Rewari, Haryana, India

Sales Depot :

B-19, Meerut Road, Industrial Area, Meerut Road, Ghaziabad - 201 003, Uttar Pradesh, India

Branch Office :

Located at:

Jammu	Guwahati
Jalandhar	Varanasi
Ludhiana	Jamshedpur
Bhatinda	Kolkata
Patiala	Vishakhapatnam
New Delhi	Vijayawada
Mumbai	Trichy
Parwanoo	Madurai
Chandigarh	Trivandrum
Ambala	Thiruvalla
Dehradun	Cochin
Ghaziabad	Calicut
Sahibabad	Mangalore
Faridabad	Bangalore
Bareilly	Hubli
Agra	Tirupati
Lucknow	Panji
Kanpur	Gulbarga
Patna	Kolhapur
Siligari	Hyderabad
Pune	Chennai
Bhiwandi	Rajkot
Nagpur	Indore
Cuttack	Udaipur
Raipur	Gwalior
Jabalpur	Bhopal
Varanasi	Jaipur
Surat	Jodhpur
Baroda	Narol
Ahmedabad	Aurangabad

DIRECTORS

As on: 31.03.2013

Name :	Dr. Jamshed Jiji Irani
Designation :	Chairman
Address :	221, A-Wing, NCPA Apartment, Nariman Point, Mumbai - 400 021, Maharashtra, India
Date of Birth/Age :	02.06.1936
Date of Appointment :	29.10.2002
Name :	Mr. Devendra Motilal Kothari
Designation :	Vice Chairman
Address :	8-4, Seaface Park Co-Operative Housing Society, Bhulabhai Desai Road, Mumbai - 400 026, Maharashtra, India
Date of Birth/Age :	30.03.1930
Date of Appointment :	01.04.1973
Name :	Mr. Harishchandra M. Bharuka
Designation :	Managing Director
Address :	A-ll, Twin Towers Premises Co-Operative Housing Society Limited, Off V S Marg, Mumbai - 400 025, Maharashtra, India
Date of Birth/Age :	22.06.1960
Date of Appointment :	01.04.1999
Name :	Mr. Hiroshi Ishino
Designation :	Director
Address :	3-14-15, Ml Nani Meguro-HU, Tokyo, Japan
Date of Birth/Age :	10.04.1951
Date of Appointment :	19.01.2005
Name :	Mr. Pradip P. Shah
Designation :	Director
Address :	72-A, Embassy Apartment, 7th Floor, 46 Nepeansea Road, Mumbai - 400 036, Maharashtra, India
Date of Birth/Age :	07.01.1953
Date of Appointment :	30.01.2007
Name :	Mr. Noel Naval Tata
Designation :	Director
Address :	Windmere - 55, Cuffe Parade, Mumbai - 400 005, Maharashtra, India
Date of Birth/Age :	12.11.1956
Date of Appointment :	27.10.2007
Name :	Mr. Pravin D. Chaudhari
Designation :	Whole Time Director
Address :	12, Juhu Goldmist, JUPD Scheme, Mumbai -400 049, Maharashtra, India
Date of Birth/Age :	17.05.1968
Date of Appointment :	30.04.2008
Name :	Mr. Yoshikazu Takahashi
Designation :	Director
Address :	7-Chome 6-1-4, Okamoto Higashinada - KU, Kobe, Hyogo, Japan
Date of Birth/Age :	11.01.1953
Date of Appointment :	26.03.2010
Name :	Mr. Hitoshi Nishibayashi
Designation :	Director
Address :	7-Chome 6-1-4, Okamoto Higashinada - KU, Kobe, Hyogo 6580072, Japan
Date of Birth/Age :	31.05.1963
Date of Appointment :	30.07.2010
Name :	M. Tanaka
Designation :	Director

KEY EXECUTIVES

Name :	Mr. Gomatam Thirumalai Govindarajan
Designation :	Company Secretary
Address :	F-203, Lloyds Estate, VIT College Marg, Wadala (East), Mumbai – 400 037, Maharashtra, India
Date of Birth :	16.11.1964
Date of Appointment :	01.10.1993

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on: 31.03.2013

Category of Shareholder	No. of Shares	Percentage of holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
(2) Foreign
Bodies Corporate	37329760	69.27
Sub Total	37329760	69.27
Total shareholding of Promoter and Promoter Group (A)	37329760	69.27
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	1127444	2.09
Financial Institutions / Banks	4934	0.01
Insurance Companies	1834207	3.40
Foreign Institutional Investors	4993487	9.27
Sub Total	7960072	14.77
(2) Non-Institutions
Bodies Corporate	4068697	7.55
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 Million	3576580	6.64
Individual shareholders holding nominal share capital in excess of Rs. 0.100 Million	856089	1.59
Any Others (Specify)	100774	0.19
Non Resident Indians	61436	0.11
Trusts	5950	0.01
Any Other	33388	0.06
Sub Total	8602140	15.96
Total Public shareholding (B)	16562212	30.73
Total (A)+(B)	53891972	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)	53891972	0.00

BUSINESS DETAILS

Line of Business :

Manufacturing and Marketing of Paints, Varnishes and Enamels, Oils and Synthetic Resins.

Products :

Product Description	Item Code No.
Paints	320890.03

PRODUCTION STATUS (AS ON 31.03.2011)

Particulars	Unit	Installed Capacity	Actual Production
Paints, Varnishes and Enamels and Powder Coatings	MT	220800	190023
Synthetic Resins	MT	86500	44822
Pretreatment Chemicals	MT	2400*	--

NOTE:

* Used for processing goods on behalf of Nipa Chemicals Limited, an erstwhile associate company.

(a) Installed capacity has been certified by the Works Manager and accepted by the Auditors without verification, being a technical matter.

(b) Production does not include goods processed outside. Sales, opening stock and closing stock include goods processed and purchased from outside. The closing stock is after adjustments for obsolescence and shortages. Closing stock figures, if derived from opening stock plus production / purchases and less sales would therefore be different.

GENERAL INFORMATION

No. of Employees :

2456 (Approximately)

Bankers :

· Union Bank of India

· Standard Chartered Bank

· HDFC Bank Limited

· BNP Paribas

Facilities :

(Rs. In Millions)

Secured Loan	As on 31.03.2013	As on 31.03.2012
LONG TERM BORROWING
Secured Sales Tax Deferral Loan (Secured by a charge on the fixed assets of the factory at Jainpur)	9.000	29.630
Total	9.000	29.630
Notes: Package Scheme of Incentive allowed the Company to accumulate the sales tax collected from its customers in respect of goods produced at Jainpur factory. Sales tax collected each year is repayable after five years from the year of collection. Outstanding amount is repayable in two annual instalments from the reporting date. Sales Tax Deferral Loan is interest-free. [Current maturity of Sales Tax Deferral Loan of Rs. 20.640 Millions (2011-2012 Rs.10.100 Millions) is disclosed under ‘Other Current Liabilities'.

Banking Relations :	--
Auditors :
Name :	BSR and Company Chartered Accountants
Address :	Mumbai, Maharashtra, India
Solicitors :
Name :	Kanga and Company
Address :	Mumbai, Maharashtra, India
Holding Company :	Kansai Paints Nepal Private Limited (w.e.f. 01.10.2012)
Fellow Subsidiary :	· Kansai Paint Philippines Inc. · Kansai Resin (Thailand) Company Limited · Kansai Coatings Malaysia SDN. BHD.

CAPITAL STRUCTURE

As on: 31.03.2013

Authorised Capital :

No. of Shares	Type	Value	Amount
60000000	Equity Shares	Rs.10/- each	Rs.600.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
53891972	Equity Shares	Rs.10/- each	Rs.538.920 Millions

Details of Shareholders holding more than 5% of shares:

	%	No. of Shares
Holding Company:
Kansai Paint Company Limited, Japan	69.27	37329760
Others:
ICICI Prudential Life Insurance Company Limited	—	—
Aberdeen Asset Management Asia Limited	7.25	3905198

	No. of Shares
Aggregate number of bonus shares issued during the period of five years immediately preceding the reporting date by capitalisation of security premium reserve	26945986

The Company has issued one class of shares, i.e. equity shares, which enjoys similar rights in respect of voting, payment of dividend and repayment of capital. On winding up of the company, the holders of equity shares will be entitled to receive the residual assets of the company, remaining after distribution of all preferential amounts in proportionate number of equity shares held.

Reconciliation of the number of shares outstanding at the beginning and at the end of the reporting period:

	No. of Shares
Number of shares at the beginning of the year	53891972
Issued during the year	—
Number of shares at the end of the year	53891972

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.03.2013
I. EQUITY AND LIABILITIES
(1)Shareholders' Funds
(a) Share Capital	538.920
(b) Reserves & Surplus	12320.880
(c) Money received against share warrants	0.000
(2) Share Application money pending allotment	0.000
Total Shareholders’ Funds (1) + (2)	12859.800
(3) Non-Current Liabilities
(a) long-term borrowings	604.850
(b) Deferred tax liabilities (Net)	430.630
(c) Other long term liabilities	0.000
(d) long-term provisions	385.240
Total Non-current Liabilities (3)	1420.720
(4) Current Liabilities
(a) Short term borrowings	0.000
(b) Trade payables	3893.420
(c) Other current liabilities	1648.290
(d) Short-term provisions	800.040
Total Current Liabilities (4)	6341.750
TOTAL	20622.270
II. ASSETS
(1) Non-current assets
(a) Fixed Assets
(i) Tangible assets	7725.690
(ii) Intangible Assets	19.040
(iii) Capital work-in-progress	1234.900
(iv) Intangible assets under development	0.000
(b) Non-current Investments	480.980
(c) Deferred tax assets (net)	0.000
(d) Long-term Loan and Advances	442.350
(e) Other Non-current assets	0.000
Total Non-Current Assets	9902.960
(2) Current assets
(a) Current investments	125.040
(b) Inventories	5340.730
(c) Trade receivables	4199.890
(d) Cash and cash equivalents	600.660
(e) Short-term loans and advances	192.980
(f) Other current assets	260.010
Total Current Assets	10719.310
TOTAL	20622.270

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2012	31.03.2011
SHAREHOLDERS FUNDS
1] Share Capital		538.920	538.920
2] Share Application Money		0.000	0.000
3] Reserves & Surplus		10092.620	8622.750
4] (Accumulated Losses)		0.000	0.000
NETWORTH		10631.540	9161.670
LOAN FUNDS
1] Secured Loans		29.630	81.141
2] Unsecured Loans		660.130	743.699
TOTAL BORROWING		689.760	824.840
DEFERRED TAX LIABILITIES		0.000	0.000
TOTAL		11321.300	9986.510
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		3963.230	2782.073
Capital work-in-progress		1614.870	751.647
Advance for capital expenditure		0.000	284.099
INVESTMENT		1835.050	3718.228
DEFERRED TAX ASSETS		102.210	134.130
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	4537.100	3541.025
	Sundry Debtors	3588.340	2602.599
	Cash & Bank Balances	591.770	396.906
	Other Current Assets	183.930	0.000
	Loans & Advances	564.700	502.315
Total Current Assets		9465.840	7042.845
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	3542.370	3512.502
	Other Current Liabilities	953.720	122.935
	Provisions	1163.810	1091.075
Total Current Liabilities		5659.900	4726.512
Net Current Assets		3805.940	2316.333
MISCELLANEOUS EXPENSES		0.000	0.000
TOTAL		11321.300	9986.510

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2013	31.03.2012	31.03.2011
	SALES
		Income	28566.190	26005.720	21387.302
		Other Income	163.170	242.660	234.609
		TOTAL (A)	28729.360	26248.380	21621.911
Less	EXPENSES
		Cost of Materials Consumed	18985.740	16968.980	14002.453
		Purchases of Stock-in-Trade	1022.830	917.500	--
		Employee Benefits Expense	1181.430	1069.440	916.420
		Other Expenses	4597.610	4159.140	3563.404
		Changes in Inventories	(582.400)	(482.350)	--
		Profit on Sale of Long Term Trade Investment	--	--	(253.665)
		Reversal of excess depreciation in respect of earlier years	(1149.250)	--	--
		TOTAL (B)	24055.960	22632.710	18228.612
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		4673.400	3615.670	3393.299
Less	FINANCIAL EXPENSES (D)		0.160	0.860	8.428
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		4673.240	3614.810	3384.871
Less/ Add	DEPRECIATION/ AMORTISATION (F)		471.070	563.530	493.548
	PROFIT BEFORE TAX (E-F) (G)		4202.170	3051.280	2891.323
Less	TAX (H)		1280.350	892.430	831.478
	PROFIT AFTER TAX (G-H) (I)		2921.820	2158.850	2059.845
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		6213.570	4959.587	3732.073
Less	APPROPRIATIONS
		Proposed Dividend	592.810	592.810	538.920
		Tax on Proposed Dividend	100.750	96.170	87.426
		Transfer to General Reserve	292.180	215.890	205.985
	BALANCE CARRIED TO THE B/S		8149.650	6213.570	4959.587
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	5.940	11.050	6.441
		Recovery of Freight, Insurance and Other Charges on Exports	0.250	0.560	0.295
	TOTAL EARNINGS		6.190	11.610	6.736
	IMPORTS
		Raw Materials	4914.890	4757.560	3526.492
		Components and Spare Parts	11.940	9.820	19.432
		Finished Products	249.590	285.970	206.176
		Capital Goods	108.030	69.060	13.090
	TOTAL IMPORTS		5284.450	5122.410	3765.190
	Earnings Per Share (Rs.)		39.80	40.06	38.22

KEY RATIOS

PARTICULARS		31.03.2013	31.03.2012	31.03.2011
PAT / Total Income	(%)	10.17	8.22	9.53
Net Profit Margin (PBT/Sales)	(%)	14.71	11.73	13.52
Return on Total Assets (PBT/Total Assets}	(%)	22.23	22.72	29.43
Return on Investment (ROI) (PBT/Networth)		0.33	0.29	0.32
Debt Equity Ratio (Total Debt/Networth)		0.05	0.06	0.09
Current Ratio (Current Asset/Current Liability)		1.69	1.67	1.49

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

UNSECURED LOAN

(Rs. In Millions)

Particular	As on 31.03.2013	As on 31.03.2012
Unsecured Sales Tax Deferral Loan	595.850	660.130
Total	595.850	660.130

Notes:

Package Scheme of Incentive allowed the Company to accumulate the sales tax collected from its customers in respect of goods produced at Lote factory. Sales tax collected each year is repayable in five equal yearly installments after ten years from the year of collection. Outstanding amount is repayable in eight annual installments from the reporting date.

Sales Tax Deferral Loan is interest-free. [Current maturity of Sales Tax Deferral Loan of Rs. 64.280 Millions (2011-2012 Rs. 45.750 Millions) is disclosed under ‘Other Current Liabilities’

MANAGEMENT DISCUSSION AND ANALYSIS

Subject, a subsidiary of Kansai Paint, Japan, is one of India’s leading paint companies.

Subject had its beginning as Gahagan Paints and Varnishes Company Limited in the year 1920. Over the 93 years of its existence the Company has built a strong brand and has gained a reputation for high quality, innovation and differentiated product offerings. Subject vision has been to leverage global technology and serve the customers with superior coatings systems and world class solutions.

The Company has 5 manufacturing facilities situated at Lote in Maharashtra, Bawal at Haryana, Jainpur in UP, Chennai and the latest state-of-the-art plant at Hosur in Tamilnadu. The strategic geographical set up of the plants has been advantageous in providing high service levels and supply chain efficiency, thus leading to customer satisfaction.

Subject as a Company is committed to the purpose of touching and improving the lives of consumers. It does so by expanding its reach and providing consumers with greater product choices to meet evolving customer demands.

The Company’s strategic investments are in line with its purpose-inspired growth strategy to drive long-term value for customers and all stakeholders. The Company also regularly benchmarks itself across sectors and identifies numerous strategic initiatives that it should undertake. These initiatives form part of the Company’s Mission document.

The Company is a leader in the Industrial paint market. The full system supply capability in tandem with the technological advanced products introduced over the years has been instrumental in sustaining the leadership for the industrial business segment. KNPL has always launched a slew of products for customer across various market segments which are innovative and technologically superior.

The Company has always viewed IT as strategic and capable of creating competitive differentiation. Over the years it has successfully implemented a variety of IT solutions in various operational areas.

The organization has been felicitated with several awards in all functional areas of Products, Services and Governance.

INDUSTRY PROGRESS

The financial year 2012-13 has been challenging. For a greater part of the year the industry witnessed high interest rates and significant inflation in addition to uncertainty in the global scenario.

The Company has taken this operating environment as a challenge and focused on sustainable growth. While practicing caution, it has leveraged its capacity enhancements, operational controls, product innovations, customer reach and infrastructural support.

As a result, Kansai Nerolac has been able to consolidate its leadership in the industrial, automotive and powder coating business and focus on the decorative business through the unique healthy home products proposition.

As on March 2013, the industry size for paints is estimated at around Rs. 285000.000 Millions. The organized sector accounts for 79%. The Decorative paints segment accounts for around Rs. 200000.000 Millions while industrial accounts for Rs. 85000.000 Millions of the total paint market.

In the long term the paints industry is expected to grow at 12-13% which is roughly 1.5 to 2 times the GDP.

MARKETING INITIATIVES

OUTLOOK

Subject has continued its efforts to touch the homes of Indian consumers by providing ‘Healthy Home Paints’. The Company has reached out to consumers through its brand ambassador Shah Rukh Khan. The Company’s media message has been a reflection of its Healthy Home Paints theme and has included the promotion of environment friendly, low VOC and lead free products.

A series of campaigns have been initiated to showcase the wide range of products for the consumers. One of them has been “NO VOC NO GADBAD” campaign, launched to create awareness amongst masses about ‘Painting a Greener Tomorrow’. Subject has aired campaigns of Impressions Eco Clean on all leading channels. Several activities were carried out on World Environment Day on different media platforms so as to leverage their “Healthy Home and Eco Friendly” positioning.

During the year the Company launched a unique initiative ‘Paint the Change’. Paint the change is the Company’s

endeavour to create a platform to empower consumers to make the change around them, thereby helping them to invest in a greener future. Consumers can contact their nearest collection centers volunteered by the Company’s dealers who would collect unused paint from them or drop the unused paint at Company depots or showrooms.

After extensive research on the existing models a new version of NEROLAC COLOR STYLERS- NCS (Version 4) was launched this year. The key features of this version includes Touch Screen interface, discussion counter, Vastu book and all shades ranging from Plain finishes to Metallics, Disney and Ideaz with its USP.

The Company believes that it is important to reach out to the influencers as well. It has collaborated with the architects and interior decorators with initiatives likeRangashala – a new initiative to help painters learn and grow with Nerolac.

Nerolac’s endeavour to engage with the Generation Next audiences by leveraging the online space has entered a new phase with its Social Media Campaigns – Kuch Change Karein, Chalo Tune Badlein – Personalise the Nerolac Jingle and “They love all their fans” activity. The Company is now enhancing its relationship with the consumers through social networking tools like Facebook and has achieved a huge fan base in the paint industry. It is serving as a good platform for communicating all campaigns and events and getting consumer insights. Having received a great response from consumers on Nerolac’s Facebook page, Nerolac has gone ahead and established an Official YouTube Channel of Nerolac Paints, India.

Kansai Nerolac is the Market Leader in the automotive coating segment in India with a dominant market share. It has built a strong credibility by creating customer service objectives with the OEMs and monitoring the progress together. These aspects have helped to attain business of the existing customers and get access to new auto European manufacturers and others. Multiple OEM lines have been awarded to the Company for future business prospect.

Subject has grown and maintained its position in Industrial Coatings segment with a wide range of products in the Automotive, Powder, General Industrial and High performance Coatings space. The Company believes that customer relationship, profitability and operational efficiency are vital for business and continued growth. This goes hand in hand with the right mix of products, high quality and on time delivery. Subject in partnership with Kansai, Japan has been able to leverage the competitive advantage to ensure a strong market presence. The industrial marketing team has participated in a series of color and product presentations, seminars, vendor meets, customer satisfaction surveys and exhibitions. This has given brand visibility to the Company and further strengthened the Company’s presence in the industry.

This year, the Company has focused on the augmentation of auto refinish business by working on comparative market study, understanding needs of customers, product innovations and brand visibility. The Company introduced Retan PG ECO Hybrid Refinishing System in body shops in India which is Japan’s leading Auto refinishing system.

There has been similar focus on Performance Coatings business division of powders and liquids. Several marketing initiatives have been taken forward to sustain leadership status for Powder coatings. The customer requirements are well analyzed and the products developed to cater to them.

Operational

Operational risk relates to the rising crude oil prices and other raw material costs, increase in labour cost, power shortage and power costs, transportation, demand generation, environmental hazards which may hamper the business cycle. Therefore, the Company is ready with action plans to allay the risks. Efficient manufacturing, strong supply chain, high quality raw materials, timely reach to the customers, working capital management, productivity enhancement, right inventory levels, talent retention, adherence to standard operating procedures are the cutting edge to overcome the risks and face the competitive environment.

Financial

Financial risk relates to the Company’s ability to meet financial obligations and mitigate credit risk, volatility in foreign currency exchange rates and interest rates and commodity prices. They face credit risk in their businesses, but proper planning has helped Subject to maintain its position in the market.

INFORMATION TECHNOLOGY

IT investments and initiatives have played a pivotal role in bringing business value to Subject. During the year greater emphasis was given to bring greater maturity in the usage and adoption of new IT technologies introduced in the previous years in the areas of Customer Relationship Management (CRM), Business Communication Manager (BCM), Business Intelligence and Business Objects (BI-BO), Advanced Planner and Optimizer (APO) amongst others.

The CRM initiative which was rolled out in the last year is being taken to the next level in terms making the frontline sales force equipped with key information which will ensure higher visibility and focus on servicing the customer. The Call center initiative is being leveraged upon to stay connected with their customers. New functionalities were rolled out in APO (Advanced Planner and Optimizer) for solving supply chain process challenges resulting in business benefits like cost optimization, reduction in planning time, improved optimization of production plan.

Solution Manager was implemented to gain technical excellence in various IT processes. This will also act as an interface in aligning Subject with global best practices. It will also enable Subject to take advantage of innovations in IT. In continuation of last year, various actionable dashboards were implemented covering all business domains, with the objective of providing faster and result oriented actionable MIS.

AWARDS AND RECOGNITION

AWARDS BY EXTERNAL AGENCIES:

· Green Believer Plant Award for Subject – Bawal plant by Frost and Sullivan for FY 2011.

· “The Best innovative idea” award for barrel cleaning machine at the Manufacturing Innovation Conclave – 2012, organized by Industry 2.0 magazine.

· A “Certificate of Merit” for achieving Zero Accident Frequency Rate to Subject – Lote Plant by National Safety Council – Maharashtra Chapter.

· A merit certificate at the ICE (In-House Communication Excellence) Awards 2012, an initiative of Shailaja Nair Foundation.

· “Best HR team” Award (in the western region) at the Human Capital Awards 2012 organized by Indira Group, Pune, in association with the Centre for Change Management, Mumbai.

· KNPL was awarded for the Best business HR case study by Hindustan Times Shine HR Summit 2012.

AWARDS BY CUSTOMERS:

· Green Vendor Developer Program Award from Hero Motocorp Limited, for outstanding contribution.

· Award for Capacity Enhancement from the Maruti Suzuki India Limited for Subject contributions.

· Toyota Boshoko Automotive Limited presented “Appreciation Award” for outstanding support in terms of shorter lead time for development and supplies.

FIXED ASSETS

Tangible Assets

• Freehold Land

• Leasehold Land

• Buildings

• Plant and Equipment

• Furniture and Fixtures

• Vehicles

• Office Equipment

• Assets for Scientific Research

Intangible Assets

• Computer Software

AS PER WEBSITE DETAILS

PRESS RELEASE

KANSAI NEROLAC LAUNCHES ITS FIRST FLAGSHIP SHOPPE IN MUMBAI

~ Nerolac Impression Shoppe incorporates New Technology that enables customized colour previews of your homes ~

12th February 2013,- Mumbai: Kansai Nerolac, one of India's leading players in the paint industry has launched its first Nerolac Impression Shoppe in - Jogeshwari West, Mumbai. The store offers you -

• Latest colour trends with wide variety

• Unique Designer Finishes

• Spellbound Experience

• Expert Consultancy

The USP of the Impression shoppe is the All in one Touch Screen. It provides assistance on:

• Painting Guide,

• Designer Finishes (both Interior and Exterior),

• Product Application,

• Ready templates for previews,

• Customized previews as per consumer homes.

Since painting today is a high ticket item for a consumer, he desires value for his money and does a comprehensive research before finalizing the brand, product and service. To help consumers make an informed choice - Kansai Nerolac Paints Limited has started a Shop in Shop retail model called Nerolac Impression Shoppe. These stores have a welcoming ambience for consumers and their family unlike other paint and hardware stores. This provides a complete assistance to consumers in making a correct choice on the brand and product through various elements like touch and feel panels, product information and color tools.

Kansai Nerolac is experimenting with the touch panel, bigger retail format for the first time with the launch of the new Nerolac Impression Shoppe in Central Paints- Jogeshwari West, Mumbai. Speaking on this occasion Mr. Sukhpreet Singh, Vice President of Marketing and Sales (Decorative) - Kansai Nerolac said "Consumers are buying finishes on their wall and not just paint cans. They need to be very sure of what the finish will be like, how the color will look under different light conditions, what product is suitable for which surface, which shade should be chosen. With these stores, we are trying to engage the consumers by assisting them in making a correct choice". Mr. Shaji Thomas, General Manager-Sales (Decorative) was also present at the inauguration.

Consumer Involvement in paints is increasing with their growing involvement in the Home decor / Improvement space. With the advent of technology and social networking, consumers are now more aware than they ever were on different kinds of paints and finishes. This is also evident from the fact that more and more consumers are visiting our website and Facebook page to know more about Kansai Nerolac.

About Kansai Nerolac Paints Limited:

Kansai Nerolac Paints has been at the forefront of paint manufacturing for more than 90 years pioneering a wide spectrum of quality paints. Kansai Nerolac is the second largest paint company in India and is the leader in Industrial segment, having a turnover of Rs.30200.000 Millions. The company has five strategically located manufacturing units all over India and a strong dealer network across the country. The company manufactures a diversified range of products ranging from decorative paints coatings for homes, offices, hospitals and hotels to sophisticated industrial coatings for most of the industries.

KANSAI NEROLAC PAINTS LIMITED ANNOUNCES Q4 RESULTS FY 2011-2012

Net Sales up by 28 % and Operating Profit up by 26.8 %

Mumbai, May 02, 2012: Kansai Nerolac Paints Limited (KNPL), one of the leading Paint companies in India, today at the Board meeting announced its unaudited results for the fourth quarter of financial year 2011-12. For the quarter, the company declared net sales of Rs.6670.000 Millions, marking a growth of 28% over the same quarter of the previous year. Operating profit was Rs. 567.000 Millions a growth of 26.8% over the same quarter of the previous year. For the year, Net sales were at Rs. 26010.000 Millions a growth of 21.4% over the same period last year and Net profit was at Rs. 2160.000 Millions a growth of 5 % over the same period last year.

For the year, Gross Sales and Operating Income was at Rs.30200.000 Millions an increase of 21 % over the same period last year. The bottom-line results are not strictly comparable due to extraordinary items in the previous year. For the year Operating profit was up at Rs.2810.000 Millions a growth of 16.4 % over same period last year.

Commenting on the announcement, Mr. H. M. Bharuka, Managing Director, Kansai Nerolac Paints Limited said, "FY12 has been a challenging year both in terms of demand and cost pressures. In the light of this, KNP has been able to maintain good momentum both in terms of growth and profit. During the quarter inflationary pressures continued as well as there was volatility in the exchange rates. This has had an impact on raw material prices. To counter inflation, KNPL has been able to partly pass on this increase to the market. The outlook for FY13 is challenging in terms of top-line and bottom line. The company has taken initiatives to ensure growth over the coming quarters. On the cost side, interest rates, volatility in exchange rates and inflationary pressures on input costs coupled with un-certainty in the global economy create pressures. A further depreciation of the rupee will add to the cost pressures. The short-term out-look thus continues to remain cautious. Overall, however the picture of paint demand remains very positive over the long term."

Outlook of Indian Paint Industry:

The size of domestic paint industry is estimated at Rs.240000.000 Millions as of Mar 2011. The good growth in infrastructure, core sector as well as automobile and real estate is likely to have a positive effect on the overall demand of paint for the industry.

About Kansai Nerolac Paints Limited:

Kansai Nerolac Paints has been at the forefront of paint manufacturing for more than 90 years pioneering a wide spectrum of quality paints. Kansai Nerolac is the second largest paint company in India and is the leader in Industrial segment, having a turnover of Rs.30200.00 Millions. The company has five strategically located manufacturing units all over India and a strong dealer network across the country. The company manufactures a diversified range of products ranging from decorative paints coatings for homes, offices, hospitals and hotels to sophisticated industrial coatings for most of the industries.

KANSAI NEROLAC PAINTS LIMITED ANNOUNCES Q3 RESULTS FY 2011-2012

Net Sales up by 18.8% and Net Profit up by 26.7%

Mumbai, January 30, 2012: Kansai Nerolac Paints Limited (KNPL), one of the leading Paint companies in India, today at the Board meeting announced its unaudited results for the third quarter of financial year 2011-12. For the quarter, the company declared net sales of Rs. 6655.200 Millions, marking a growth of 18.8 % over the same quarter of the previous year. Net profit was Rs. 526.800 Millions a growth of 26.7 % over the same quarter of the previous year. For the nine months ending December 30th 2011, Net sales were at Rs. 19328.200 Millions a growth of 19.4 % over the same period last year and Net profit was at Rs. 1710.200 Millions a growth of 16.2 % over the same period last year.

Commenting on the announcement, Mr. H. M. Bharuka, Managing Director, Kansai Nerolac Paints Limited said, "KNP results have been good in light of the conditions prevailing. During the quarter momentum in terms of growth and profit has been maintained. Demand has been sub-dued especially in the industrial segment. The company has taken many initiatives to ensure growth over the coming quarters. The quarter witnessed sharp increases in Raw material prices as well as un-favorable exchange rates which impacted raw material prices. To counter inflation, KNPL has been able to partly pass on this increase to the market. The immediate future appears challenging on account of the high interest rates, volatility in exchange rates and input costs coupled with uncertainty in the global economy. The short-term out-look thus remains cautious. Overall, however the picture of paint demand remains very positive over the long term."

Outlook of Indian Paint Industry:

The size of domestic paint industry is estimated at Rs.240000.000 Millions as of Mar 2011. The good growth in infrastructure, core sector as well as automobile and real estate is likely to have a positive effect on the overall demand of paint for the industry.

KANSAI NEROLAC PAINTS LIMITED ANNOUNCES Q2 RESULTS FY 2012-2013

Net Sales up by 10.7%

Mumbai, October 26, 2012 Kansai Nerolac Paints Limited (KNPL), one of the leading Paint companies in India, today at the Board meeting announced its unaudited results for the second quarter of financial year 2012-13. For the quarter, the company declared net sales of Rs. 6823.000 Millions, marking a growth of 10.7% over the same quarter of the previous year. EBITA was lower at Rs.789.00 Millions reflecting de-growth of 14.9 % over the same quarter of the previous year.

Commenting on the announcement, Mr. H. M. Bharuka, Managing Director, Kansai Nerolac Paints Limited said, "Demand for the paint has improved as the quarter progressed. The inflationary pressure on input costs has continued and has ensured that costs have not come down. KNPL has been able to partly pass on this increase to the market. The recent upswing in sentiment due to reforms and a near normal monsoon has resulted in better consumer sentiment and should augur well in the coming quarters. The immediate scenario still appears challenging both in terms of top-line and profitability and the out-look for the short term remains cautious Overall, however the picture of paint demand remains very positive over the long term."

Outlook of Indian Paint Industry:

The size of domestic-paint industry is estimated at Rs.291000.000 Millions as of Mar 2012. The good growth in infrastructure, core sector as well as automobile and real estate is likely to have a positive effect on the overall demand of paint for the industry.

KANSAI NEROLAC PAINTS LIMITED ANNOUNCES Q1 RESULTS FY 2012-2013

Net Sales up by 11 % and Net Profit up by 3.4 %

Mumbai, July 30, 2012: Kansai Nerolac Paints Limited (KNPL), one of the leading Paint companies in India, today at the Board meeting announced its unaudited results for the first quarter of financial year 2012-13. For the quarter, the company declared net sales of Rs. 7235.000 Millions, marking a growth of 11% over the same quarter of the previous year. EBITA was Rs. 969.000 Millions a growth of 6.4 % over the same quarter of the previous year.

Commenting on the announcement, Mr. H. M. Bharuka, Managing Director, Kansai Nerolac Paints Limited said, "Demand for the paint has been moderate during the quarter which is reflected in KNP numbers. The inflationary pressures witnessed in earlier quarters have reduced, however the fall in the rupee has ensured that input costs have not come down. KNPL has been able to partly pass on this increase to the market. Going forward uncertainty in the economy, concern on the monsoon, depreciation of the rupee keeping input costs high, all make the immediate future very challenging both in terms of top-line and profitability. We will have to wait and watch as to how these factors will play out and hence the out-look for the short term remains cautious Overall, however the picture of paint demand remains very positive over the long term:"

Outlook of Indian Paint Industry:

The size of domestic paint industry is estimated at Rs.291000.000 Millions as of Mar 2012. The good growth in infrastructure, core sector as well as automobile and real estate is likely to have a positive effect on the overall demand of paint for the industry.

Kansai Nerolac to enter JV with Nepal Shalimar, to acquire 68% stake in Nepalese paint major

- Proposed acquisition will cost Nerolac approx 7.55 Cr in investment -

- Acquisition expected to consolidate 10% market share for Kansai Nerolac in Nepal –

20th June, 2012 - Owing to Nepal's progressive economy, Kansai Nerolac Paints Limited (KNPL) has shown significant business interest in its neighboring country. The company is in the process of finalizing its 68% stake in one of the leading paint manufacturers in Nepal, Nepal Shalimar Private Limited (NSPL).

The investment to be made by Kansai Nerolac towards this proposed acquisition shall be about NPR 12.58 crores (around Rs. 75.500 Millions). Further, the company would be giving a loan of NPR 10.20 crores (around Rs. 61.200 Millions) to fund the working capital requirement of NSPL.

Considered in the top 5 bracket of Nepal, Nepal Shalimar currently commands a market share of 8% in its country. It had a turnover of NPR 20.57 crores (Rs. 123.400 Millions) in 2010-11.

Identifying the synergy between the companies, Mr. HM Bharuka, MD, Kansai Nerolac, commented, "With KNPL's entry in the Himalayan state, our consolidated profit would improve and in turn increase EPS which will benefit our shareholders."

KNPL will be utilizing the manufacturing set up of Nepal Shalimar and manufacturing the Nerolac range of products that are currently exported to Nepal. This investment by the Company in NSPL is subject to the approval from the concerned authorities in India and Nepal.

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 records 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] 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.60.59
UK Pound	1	Rs.92.92
Euro	1	Rs.78.94

INFORMATION DETAILS

Report Prepared by :

VRN

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	10
PAID-UP CAPITAL	1~10	10
OPERATING SCALE	1~10	9
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	9
--PROFITABILIRY	1~10	9
--LIQUIDITY	1~10	10
--LEVERAGE	1~10	9
--RESERVES	1~10	9
--CREDIT LINES	1~10	10
--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	YES
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTER
--RBI	YES/NO	NO
--EPF	YES/NO	NO
TOTAL		85

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.