MIRA INFORM REPORT

 

 

Report Date :

19.11.2013

 

IDENTIFICATION DETAILS

 

Name :

VF BRANDS INDIA PRIVATE LIMITED (w.e.f. 05.01.2012)

 

 

Formerly Known As :

VF ARVIND BRANDS PRIVATE LIMITED

 

 

Registered Office :

Bagmane Laurel, Block "B", Level 9, 8th Floor, Bagmane Tech Park, CV Raman Nagar, Bangalore – 560093, Karnataka

 

 

Country :

India

 

 

Financials (as on) :

31.03.2012

 

 

Date of Incorporation :

05.04.2006

 

 

Com. Reg. No.:

08–067548

 

 

Capital Investment / Paid-up Capital :

Rs. 195.357 Millions

 

 

CIN No.:

[Company Identification No.]

U17110KA2006PTC067548

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

BLRV05705A

 

 

PAN No.:

[Permanent Account No.]

AACCV2727L

 

 

Legal Form :

Private Limited Liability Company

 

 

Line of Business :

Designing, Marketing and Distributor of various VF Brand Apparels to various Franchisees.

 

 

No. of Employees :

Information declined by the management

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba (50)

 

RATING

STATUS

 

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

 

Maximum Credit Limit :

USD 4030000

 

 

Status :

Satisfactory

 

 

Payment Behaviour :

Regular

 

 

Litigation :

Clear

 

 

Comments :

Subject is a joint venture between VF Mauritius Limited and Arvind Limited. It is a well-established company having satisfactory track record.

 

Management of the company has filed its latest financial with the government department but it is not available with us. As per previous year financials (i.e.2012), there seems some dip in the profits of the company. However, the company takes into consideration the brand image and the strong financial strength of the parent company VF Corp.

 

Trade relations are reported as fair. Business is active. Payments are reported to be regular and as per commitments.

 

The company can be considered normal for business dealings at usual trade terms and conditions. 

 

NOTES :

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

 

 

INDIAN ECONOMIC OVERVIEW

 

The current downturn provides an opportunity to push ahead with reforms to accelerate growth, says the latest India Development Update report released by the World Bank. The report says that the adverse effects of rupee depreciation are likely to be offset by the gains in the exports performance due to improved external competitiveness. Since May this year, the local currency has depreciated substantially and fell to a record level of Rs 68.85 to a dollar on August, 28.

 

A stagflation like situation appears to have arisen as inflation jumped to an eight month high of 6.46 % for the month of September. It is up from 6.10 % in August. Growth continues to be muted with factory output plunging to 0.6 % in August. Onion prices have risen nearly 300 % from last September. Vegetables cost nearly 90 % more than they did last year. Wake up to the economic contribution of slum dwellers. They contribute more than 7.5 % to the country’s gross domestic product, according to a recent study conducted in 50 top cities.

 

136000 estimated number of jobs created during the second quarter of the current financial year. 50000 estimated number of additional jobs in the field of corporate social responsibility in the coming years.

 

The International Finance Corporation expects to come out with its rupee linked bonds issue before the end of 2013 as a part of its plan to raise $ 1 billion. The Apple iPhone 5c (Rs 41900 for 16 GB variant) and 5s (Rs 53500 for 16GB variant) has been launched in India from 1st November.

 

The Land Acquisition Act to provide just and fair compensation to farmers will come into force from January 1 next year, said Rural Development Minister Jairam Ramesh. The Act replaces a 119 year old registration. The Securities and Exchange Board of India has approved the trading of currency futures on the Bombay Stock Exchange. The exchange plans to launch the currency futures platform with advanced trading technology by the end of November.

 

 

EXTERNAL AGENCY RATING

 

Rating Agency Name

CRISIL

Rating

Long term rating : AA+

Rating Explanation

Strong degree of safety it carry very low credit risk.

Date

June 7, 2013

 

 

Rating Agency Name

CRISIL

Rating

Short term rating : A1+

Rating Explanation

Highest degree of safety it carry lowest credit risk

Date

June 7, 2013

 

 

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 DECLINED

 

MANAGEMENT NON-COOPERATIVE

 

[CONTACT NO.: 91-79-22203030/ 2200267/ 91-80-30790100/ 200]

 

 

LOCATIONS

 

Registered Office :

Bagmane Laurel, Block "B", Level 9, 8th Floor, Bagmane Tech Park, CV Raman Nagar, Bangalore – 560093, Karnataka, India

Tel. No.:

91-80-30790100/ 200/ 201

Fax No.:

91-80-30790111

E-Mail :

swati_baidya@vfc.com

senthil_r@vfc.com

Website :

http://www.vfc.com

 

 

DIRECTORS

 

AS ON 14.08.2013

 

Name :

Kanchan Kumar Pant

Designation :

Managing director

Address :

Villa 143, Adarsh Vista Vighnananagar Main Road, Marathalli PO Bangalore – 560037, Karnataka, India

Date of Birth/Age :

01.09.1964

Qualification :

B. Tech, PGDM

Experience :

25 Years

Date of Appointment :

17.12.2007

PAN No.:

ABZPP2153K

DIN No.:

00219582

 

 

Name :

Aidan James O'meara

Designation :

Director

Address :

House No. 6, Stanley Court, 9, Stanley Mount Road, Stanley, Hong Kong

Date of Birth/Age :

28.12.1962

Date of Appointment :

04.10.2007

DIN No.:

00675215

 

 

Name :

Laura Catherine Meagher

Designation :

Director

Address :

12, Captains Point, Greensboro, NC Newyork USA 274553430

Date of Birth/Age :

24.03.1960

Date of Appointment :

30.04.2012

DIN No.:

05283251

 

 

Name :

Curtis Andrew Holtz

Designation :

Alternate director

Address :

Via Sassa 10, 6900 Lugano Switzerland

Date of Birth/Age :

17.08.1962

Date of Appointment :

03.01.2013

DIN No.:

06455824

 

 

Name :

Mr. Nitin Suresh Khanna

Designation :

Alternate director

Address :

A/1003, Paloma, Hiranandani Estate, Patlipada, G B Road, Thane – 400607, Maharashtra, India

Date of Birth/Age :

28.11.1972

Date of Appointment :

29.07.2013

DIN No.:

06642832

 

 

KEY EXECUTIVES

 

Name :

Ms. Swati Baidya

Designation :

Secretary

Address :

Flat # 406, Keerrthi Residency, 10th Main. 8th Cross, Maruthinagar, Malleshpalya, Bangalore – 560075, Karnataka, India

Date of Birth/Age :

21.03.1983

Date of Appointment :

14.03.2012

PAN No.:

AKYPB3036F

 

 

Name :

Chakor Jain

Designation :

Business Head - Lee

 

 

Name :

Colin Pereira

Designation :

Head – Supply Chain and Sourcing

 

 

Name :

Mr. Manish Jain

Designation :

Chief Financial Officer

 

 

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

 

AS ON 14.08.2013

 

Names of Shareholders

 

No. of Shares

 

VF Mauritius Limited,  Mauritius

 

19535690

International Securities Limited, Mauritius

 

1

 

 

 

Total

 

 

19535691

 

 

AS ON 14.08.2013

 

Equity Share Breakup

Percentage of Holding

Category

 

Foreign holdings [Foreign institutional investors, Foreign Companies, Foreign Financial Institutions, Non-resident Indian or Overseas corporate bodies or others]

100.00

 

 

Total

 

100.00

 

 

BUSINESS DETAILS

 

Line of Business :

Designing, Marketing and Distributor of various VF Brand Apparels to various Franchisees.

 

 

Products/ Services :

ITC Code No.

 

Product Descriptions

62114900

Readymade Garments

 

 

PRODUCTION STATUS (AS ON 31.03.2011)

 

Particulars

Unit

Licensed Capacity

Installed Capacity

Actual Production

Ready Made Garments - Tops

Numbers

NA

NA

13,299

Ready Made Garments - Bottoms

Numbers

NA

NA

674,232

 

Notes:

i) The Company is exempt from the licensing provisions of the Industries (Development Regulation) Act, 1951.

ii) As the company’s production activity is carried out by the job workers, installed capacity is not applicable. Company has discontinued the manufacturing operation since November 2010.

iii) Production quantity 687,531 (2010: 1,808,421) numbers produced through job workers.

 

 

GENERAL INFORMATION

 

No. of Employees :

Information declined by the management

 

 

Bankers :

·         Hong Kong and Shanghai Banking Corporation Bank

·         State Bank of India

·         ICICI Bank Limited

·         Citi Bank

 

 

 

 

Banking Relations :

--

 

 

Auditors :

 

Name :

Price Waterhouse

Chartered Accountants

Address :

The Millenia, 5th Floor, Tower D, 192 Murphy Road, Ulsoor - 560008, Bangalore, Karnataka, India

Income-tax PAN of auditor or auditor's firm :

AAEFP5579P

 

 

Ultimate Holding company :

VF Corporation USA

 

 

Holding company :

VF Mauritius Limited

 

 

Joint venture :

Arvind Limited [L17119GJ1931PLC000093]

 

 

Fellow Subsidiary company :

·         The H.D Lee Company, Inc

·         Wrangler Apparel Corp

·         VF Asia Limited

·         VF Europe BVBA

·         VF International SAGL

·         VF Services

·         VF Hong Kong Limited

·         Vans Inc

·         Arvind Polycot Limited [L99999GJ1968PLC000075]

·         Jansport Inc.

·         VF Sportwear Inc.

·         Arvind Products Limited

 

 

CAPITAL STRUCTURE

 

AS ON 31.03.2012

 

Authorised Capital :

No. of Shares

Type

Value

Amount

 

 

 

 

25,000,000

Equity Shares

Rs. 10/- each

Rs. 250.000 Millions

 

 

 

 

 

Issued, Subscribed & Paid-up Capital :

No. of Shares

Type

Value

Amount

 

 

 

 

19,535,691

Equity Shares

Rs. 10/- each

Rs. 195.357 Millions

 

 

 

 

 


 

FINANCIAL DATA

[all figures are in Rupees Millions]

 

ABRIDGED BALANCE SHEET

 

SOURCES OF FUNDS

 

 

31.03.2012

31.03.2011

I.              EQUITY AND LIABILITIES

 

 

 

(1)Shareholders' Funds

 

 

 

(a) Share Capital

 

195.357

136.667

(b) Reserves & Surplus

 

813.126

(187.511)

(c) Money received against share warrants

 

0.000

0.000

 

 

 

 

(2) Share Application money pending allotment

 

0.000

0.000

Total Shareholders’ Funds (1) + (2)

 

1008.483

(50.844)

 

 

 

 

(3) Non-Current Liabilities

 

 

 

(a) long-term borrowings

 

0.000

0.000

(b) Deferred tax liabilities (Net)

 

0.000

0.000

(c) Other long term liabilities

 

54.838

44.317

(d) long-term provisions

 

8.020

6.096

Total Non-current Liabilities (3)

 

62.858

50.413

 

 

 

 

(4) Current Liabilities

 

 

 

(a) Short term borrowings

 

0.000

1001.938

(b) Trade payables

 

814.743

580.480

(c) Other current liabilities

 

326.917

340.066

(d) Short-term provisions

 

83.008

95.735

Total Current Liabilities (4)

 

1224.668

2018.219

 

 

 

 

TOTAL

 

2296.009

2017.788

 

 

 

 

II.            ASSETS

 

 

 

(1) Non-current assets

 

 

 

(a) Fixed Assets

 

 

 

(i) Tangible assets

 

71.263

91.325

(ii) Intangible Assets

 

534.014

685.621

(iii) Capital work-in-progress

 

0.000

0.000

(iv) Intangible assets under development

 

0.000

0.000

(b) Non-current Investments

 

0.000

0.000

(c) Deferred tax assets (net)

 

0.000

0.000

(d)  Long-term Loan and Advances

 

120.660

71.927

(e) Other Non-current assets

 

0.000

0.000

Total Non-Current Assets

 

725.937

848.873

 

 

 

 

(2) Current assets

 

 

 

(a) Current investments

 

0.000

0.000

(b) Inventories

 

586.636

498.101

(c) Trade receivables

 

823.846

630.684

(d) Cash and cash equivalents

 

137.394

14.270

(e) Short-term loans and advances

 

22.196

25.860

(f) Other current assets

 

0.000

0.000

Total Current Assets

 

1570.072

1168.915

 

 

 

 

TOTAL

 

2296.009

2017.788

 

 

SOURCES OF FUNDS

 

 

 

31.03.2010

SHAREHOLDERS FUNDS

 

 

 

1] Share Capital

 

 

136.667

2] Share Application Money

 

 

0.000

3] Reserves & Surplus

 

 

1449.860

4] (Accumulated Losses)

 

 

(1745.018)

NETWORTH

 

 

(158.491)

LOAN FUNDS

 

 

 

1] Secured Loans

 

 

4.986

2] Unsecured Loans

 

 

923.216

TOTAL BORROWING

 

 

928.202

DEFERRED TAX LIABILITIES

 

 

0.000

 

 

 

 

TOTAL

 

 

769.711

 

 

 

 

APPLICATION OF FUNDS

 

 

 

 

 

 

 

FIXED ASSETS [Net Block]

 

 

984.751

Capital work-in-progress

 

 

2.147

 

 

 

 

INVESTMENT

 

 

0.035

DEFERRED TAX ASSETS

 

 

0.000

 

 

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

 

 

 

Inventories

 

 

371.389

 

Sundry Debtors

 

 

483.769

 

Cash & Bank Balances

 

 

27.116

 

Other Current Assets

 

 

0.000

 

Loans & Advances

 

 

72.215

Total Current Assets

 

 

954.489

Less : CURRENT LIABILITIES & PROVISIONS

 

 

 

 

Sundry Creditors

 

 

1005.274

 

Other Current Liabilities

 

 

73.729

 

Provisions

 

 

92.708

Total Current Liabilities

 

 

1171.711

Net Current Assets

 

 

(217.222)

 

 

 

 

MISCELLANEOUS EXPENSES

 

 

0.000

 

 

 

 

TOTAL

 

 

769.711

 

 

PROFIT & LOSS ACCOUNT

 

 

PARTICULARS

31.03.2012

 

31.03.2011

31.03.2010

 

SALES

 

 

 

 

 

Income

3911.838

3012.782

1866.180

 

 

Other Income

25.071

49.857

105.899

 

 

TOTAL                                     (A)

3936.909

3062.639

1972.079

 

 

 

 

 

Less

EXPENSES

 

 

 

 

 

TOTAL                                     (B)

3610.322

2656.735

1670.728

 

 

 

 

 

Less

PROFIT/ (LOSS) BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B)     (C)

326.587

405.904

301.351

 

 

 

 

 

Less

FINANCIAL EXPENSES                                    (D)

84.025

79.550

149.539

 

 

 

 

 

 

PROFIT/ (LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D)                               (E)

242.562

326.354

151.812

 

 

 

 

 

Less/ Add

DEPRECIATION/ AMORTISATION                     (F)

192.705

218.712

236.858

 

 

 

 

 

 

PROFIT/ (LOSS) BEFORE TAX (E-F)                 (G)

49.857

107.642

(85.046)

 

 

 

 

 

Less

TAX                                                                  (H)

0.000

0.000

0.000

 

 

 

 

 

 

PROFIT/ (LOSS) AFTER TAX (G-H)                   (I)

49.857

107.642

(85.046)

 

 

 

 

 

 

EARNINGS IN FOREIGN CURRENCY

 

 

 

 

 

Export Earnings

13.000

4.348

3.071

 

 

 

 

 

 

Earnings/ (Loss) Per Share (Rs.)

2.55

7.88

(6.22)

 

 

KEY RATIOS

 

PARTICULARS

 

 

31.03.2012

31.03.2011

31.03.2010

PAT / Total Income

(%)

1.27

3.51

(4.31)

 

 

 

 

 

Net Profit Margin

(PBT/Sales)

(%)

1.27

3.57

(4.56)

 

 

 

 

 

Return on Total Assets

(PBT/Total Assets}

(%)

2.17

5.33

(4.39)

 

 

 

 

 

Return on Investment (ROI)

(PBT/Networth)

 

0.05

(2.12)

0.54

 

 

 

 

 

Debt Equity Ratio

(Total Debt/Networth)

 

0.00

(19.71)

(5.86)

 

 

 

 

 

Current Ratio

(Current Asset/Current Liability)

 

1.28

0.58

0.81

 

 

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

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

No

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

No

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

Yes

33]

Voter ID No of Proprietor/Partner/Director, if available

No

34]

External Agency Rating, if available

Yes

 

 

CURRENT MATURITIES OF LONG TERM DEBT: NOT AVAILABLE

 

 

INDEX OF CHARGES: NO CHARGES EXIST FOR COMPANY

 

 

UNSECURED LOANS

 

UNSECURED LOANS

31.03.2012

(Rs. In Millions)

31.03.2011

(Rs. In Millions)

SHORT TERM BORROWINGS

 

 

Loans repayable on demand from banks

0.000

1001.938

 

 

 

Total

 

0.000

1001.938

 

 

GENERAL INFORMATION

 

During the year 2006, VF Corporation, USA and Arvind Limited (formerly Arvind Brands Limited) entered into a 60:40 Joint Venture (JV) to form VF Brands India Private Limited (formerly VF Arvind Brands Private Limited). The Company was formed based on the approval from Foreign Investment Promotion Board, Department of Economic Affairs, Ministry of Finance. The Company designs, markets and distributes various VF brand apparels to various franchisees and distributors across India.

 

During the year, Arvind Limited has sold its shares and have exited the JV with effect from November 2, 2011. Thus the Company has become a wholly owned subsidiary of VF Mauritius Limited. The Company has its registered office at Ahmedabad and Corporate office at Bangalore.

 

 

OPERATIONS

 

The Company has completed an impressive year of performance showing continued growth in earning in the financial year.

 

Net Sales during the financial year was Rs. 3911.838 Millions (FY 2010-11: Rs. 3012.782 Millions), an increase of 30% over the previous year.

 

The operating profit before interest and depreciation stands at Rs. 326.587 Millions as against the previous year figure of operating profit before interest and depreciation of Rs. 405.905 Millions.

 

The entire portfolio of Company’s brands namely Lee and Wrangler showed growths both in terms of volume as well as value. The Company also showed growth on its new brand, ie, Vans, both in terms of revenue and distribution.

 

 

FIXED ASSETS:

 

·         Furniture and fixtures

·         Vehicles

·         Motor vehicles

·         Office equipment

·         Computer equipments

·         Other equipments

·         Leasehold improvements

·         Goodwill

·         Know-how

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. 62.63

UK Pound

1

Rs. 101.06

Euro

1

Rs. 84.56

 

 

INFORMATION DETAILS

 

Information Gathered by :

PLK

 

 

Report Prepared by :

BVA

 


 

SCORE & RATING EXPLANATIONS

 

SCORE FACTORS

 

RANGE

POINTS

HISTORY

1~10

5

PAID-UP CAPITAL

1~10

5

OPERATING SCALE

1~10

6

FINANCIAL CONDITION

 

 

--BUSINESS SCALE

1~10

7

--PROFITABILIRY

1~10

5

--LIQUIDITY

1~10

5

--LEVERAGE

1~10

6

--RESERVES

1~10

6

--CREDIT LINES

1~10

5

--MARGINS

-5~5

--

DEMERIT POINTS

 

 

--BANK CHARGES

YES/NO

NO

--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

DEFAULTERS 

 

 

--RBI

YES/NO

NO

--EPF

YES/NO

NO

TOTAL

 

50

 

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.