MIRA INFORM REPORT

Report Date :

29.10.2013

IDENTIFICATION DETAILS

Name :	MALU ELECTRODES PRIVATE LIMITED
Registered Office :	S-111, Ramkrishna Apartment, Schaprunagare, Square, Nagpur - 440008, Maharashtra
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	05.09.1990
Com. Reg. No.:	11-058024
Capital Investment / Paid-up Capital :	Rs. 105.000 millions
CIN No.: [Company Identification No.]	U31200MH1990PTC058024
IEC No.:	0395058091
TAN No.: [Tax Deduction & Collection Account No.]	NGPM00629G
PAN No.: [Permanent Account No.]	AABCM2306H
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacturer and Exporter of Electrical and M Flux Cored Wires, Mangalam Mig Wire and Welding Electrodes.
No. of Employees :	Not Divulged

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 1200000
Status :	Satisfactory
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established company having satisfactory track record. Financials after the year 2010 are not available. As per available financials (2010), the company seems normal for business dealings. Networth of the company appears to be good. Trade relations are reported as fair. Business is active. Payment are reported to be regular and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions. Note: The financials of 2013-14 are taken from indirect sources. i.e. Crisil.

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

INDIAN ECONOMIC OVERVIEW

India’s current account deficit or CAD in April-June widened to 4.9 % of gross domestic product. High imports of gold and oil led to a worsening of the trade deficit, resulting in CAD jumping to $ 21.8 billion to the latest quarter from $ 16.9 billion in the corresponding quarter of the previous financial year. The government aims to bring down CAD to 3.7 % or $ 70 billion, in 2013/14, from 4.8 % or $ 88.2 billion in 2012/13.

The finance ministry has started preparations for Budget 2014/15. With general elections scheduled to be held by May next year, there will only be an interim budget. The new government will present the fiscal Budget.

The Supreme Court has barred clinical trials for new drugs till a monitoring mechanism is put in place to protect the lives of people on which the drugs are tested.

Mumbai has been named the world’s second most honest city according to a survey on 15 cities worldwide by Readers’ Digest magazine. Finnish capital Helsinki bagged the top spot for the world’s most honest city while Lisbon, the capital of Portugal, proved to be the least honest.  The survey put hundreds of people to test in four continents to find out just how honest they were by dropping wallets and seeing how many would be returned.

3.7 % Growth of the core sector in August, a seven month high. This takes the overall growth in April-August this year to 2.3 % compared with 6.3 % in the corresponding period next financial year.

$19 million Estimated average spending by companies across the globe including India, on social media this year, according to a global study by information technology major Tata Consultancy Services. This will rise to $ 24 million in 2015.

Rising inflation, fewer employment avenues and dwindling earnings are taking a toll on the spending capacity in India. Over 72 % respondents from middle and lower middle income families would be forced to slash their Diwali expenditure by 40 % and on average spend nearly 25 % of their monthly salary on Diwali, according to a survey by Assochem.

Analysts believe the shutdown of the US government would have limited impact in sectors such as IT or tourism that are dependent on Visa clearances.

EXTERNAL AGENCY RATING

Rating Agency Name	CRISIL
Rating	Long term: “A –“
Rating Explanation	Adequate degree of safety and carry low credit risk.
Date	30.08.2013

Rating Agency Name	CRISIL
Rating	Short term: “A2 +“
Rating Explanation	Have strong degree of safety and carry low credit risk.
Date	30.08.2013

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

Tel. No.: 91-712-2730399

LOCATIONS

Registered Office :	S-111, Ramkrishna Apartment, Schaprunagare, Square, Nagpur - 440008, Maharashtra, India
Tel. No.:	91-712-2730399 / 2734895
Fax No.:	91-712-2761315 / 2730719
E-Mail :	pramalu@satym.net.in info@prmalugroup.com prmalu@satyam.net.in meploffice@vsnl.net
Website :	http://www.prmalugroup.com www.maluelectrodes.com
Area :	1000 sq. ft
Location :	Owned
Head Office :	Neelkamal, 1249, Central Avenue, Nagpur - 440 002, Maharashtra, India
Tel. No.:	91-712-2760873
Fax No.:	91-712 2761315
E-Mail :	info@prmalugroup.com
Factory 1 :	Plot No. S-3/S-4, MIDC Hingana, Nagpur - 440 016 Maharashtra, India
Tel. No.:	91-7104-236888

DIRECTORS

As on: 29.09.2012

Name :	Mr. Venugopal Punamchand Malu
Designation :	Director
Address :	1249, Neelkamal, Central Avenue, Nagpur – 440002, Maharashtra, India
Date of Birth/Age :	25.10.1980
Date of Appointment :	01.07.2010
DIN No.:	00301177
Name :	Mr. Shrawankumar Ramlal Malu
Designation :	Director
Address :	1249, Neelkamal, Central Avenue, Nagpur – 440002, Maharashtra, India
Date of Birth/Age :	18.01.1960
Date of Appointment :	09.09.1990
DIN No.:	00301141

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on: 29.09.2012

Names of Shareholders	No. of Shares
Shawankumar Malu	875000
Punamchand Malu	910000
Kaushalya Malu	770000
Sushila Malu	812000
Anita Malu	745500
Pushpa .D. Malu	805000
Ganpati Malu	17500
Damodharlal Malu	910000
Purushottam Malu	945000
Purushottam Malu, HUF	59500
Shrawankumar Malu HUF	59500
Punamchand Malu HUF	56000
Damodharlal Malu HUF	56000
Marigold Farms Private Limited, India	910000
Venu Gopal Malu	700000
Radheshyam P Malu	770000
Bharat S. Malu	689500
Shalini V. Malu	409500
TOTAL	10500000

Equity Share Break up (Percentage of Total Equity)

As on: 29.09.2012

Category	Percentage
Bodies corporate	8.67
Directors or relatives of directors	91.33
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer and Exporter of Electrical and M Flux Cored Wires, Mangalam Mig Wire and Welding Electrodes.

GENERAL INFORMATION

No. of Employees :

Not Divulged

Bankers :

· Axis Bank Limited, M G House, Rabindranath Tagore Road, Beside Board Office, Civil Lines, Nagpur - 440001, Maharashtra, India

· HDFC Bank Limited

Facilities :

(Rs. In Millions)

Secured Loan	As on 31.03.2010	As on 31.03.2009
HDFC Bank Limited (Against Car)	3.253	0.724
Axis Bank Limited (Term Loan) (Against Pant and Machinery)	24.344	35.596
Axis Bank Limited (Cash Credit A/C) Secured against hypothecation of raw material, First Charge of Building and Machinery	114.263	133.643
Total	141.860	169.963

Banking Relations :	--
Auditors :
Name :	Demble Ramani and Company Chartered Accountants
Address :	201, M. G. House, Civil Lines, Nagpur – 440 001, Maharashtra, India
Tel. No.:	91-712-3918630 / 3918631
E-Mail :	deraco_nag@sancharnet.in deraco@nagpur.dot.net.in
PAN No.:	AABFD9880A
Enterprises owned / Managed by Key Managerial Personnel:	Ø Shree Sales Corporation Private Limited, India Ø Sunflame Fuels Private Limited, India Ø Marigold Farms Private Limited, India Ø Frontline Commercial Private Limited, India Ø Malu Paper Mills Limited, India Ø Salasar Steel and Alloys Private Limited, India

CAPITAL STRUCTURE

As on: 29.09.2012

Authorized Capital:

No. of Shares	Type	Value	Amount
15000000	Equity Shares	Rs. 10/- each	Rs. 150.000 millions

Issued, Subscribed & Paid-up Capital:

No. of Shares	Type	Value	Amount
10500000	Equity Shares	Rs. 10/- each	Rs. 105.000 millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2010	31.03.2009	31.03.2008
SHAREHOLDERS FUNDS
1] Share Capital		105.000	14.300	14.300
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		196.667	95.293	45.767
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		301.667	109.593	60.067
LOAN FUNDS
1] Secured Loans		141.860	169.963	103.902
2] Unsecured Loans		13.660	38.600	19.560
TOTAL BORROWING		155.520	208.563	123.462
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		457.187	318.156	183.529
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		135.853	113.268	71.730
Capital work-in-progress		0.551	0.000	6.632
INVESTMENT		167.937	8.888	0.000
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	353.178	38.776	40.015
	Sundry Debtors	230.380	155.771	72.507
	Cash & Bank Balances	8.775	25.492	10.088
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	77.515	39.565	17.852
Total Current Assets		669.848	259.604	140.462
Less : CURRENT LIABILITIES & PROVISIONS
		481.264	53.395	20.563
	Current Liabilities	11.737	1.018	14.732
	Provisions	24.408	9.733	0.000
0.Total Current Liabilities		517.409	64.146	35.295
Net Current Assets		152.439	195.458	105.167
MISCELLANEOUS EXPENSES		0.407	0.544	0.000
TOTAL		457.187	318.156	183.529

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		Sales	1898.317	1023.680	614.477
		Other Income	0.000	(0.174)	0.318
		TOTAL (A)	1898.317	1023.506	614.795
Less	EXPENSES
		Cost of Materials	1524.741	901.181	546.257
		Selling and Distribution Expenses	0.000	20.063	10.593
		Administrative Expenses	82.149	10.240	8.123
		TOTAL (B)	1606.890	931.484	564.973
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		291.427	92.022	49.822
Less	FINANCIAL EXPENSES (D)		23.909	22.162	15.627
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		267.518	69.860	34.195
Less/ Add	DEPRECIATION/ AMORTISATION (F)		6.211	4.389	3.861
	PROFIT BEFORE TAX (E-F) (G)		261.307	65.471	30.334
Less	TAX (H)		69.934	15.945	9.710
	PROFIT AFTER TAX (G-H) (I)		191.373	49.526	20.624
	Earnings Per Share (Rs.)		18.22	--	--

Particulars	First quarter of 2013-14
Sales Turnover (Approximately)	987.000 (million)

Expected Sales (2013-14): Rs. 4 Billion

Note: The financials of 2013-14 are taken from indirect sources. i.e. Crisil.

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	10.08	4.83	3.35
Net Profit Margin (PBT/Sales)	(%)	13.76	6.39	4.93
Return on Total Assets (PBT/Total Assets}	(%)	23.75	13.28	9.71
Return on Investment (ROI) (PBT/Networth)		0.86	0.59	0.50
Debt Equity Ratio (Total debt/Networth)		0.51	1.90	2.06
Current Ratio (Current Asset/Current Liability)		1.29	4.04	3.97

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

UNSECURED LOAN

(Rs. in Millions)

Particulars	As on 31.03.2010	As on 31.03.2009
Shareholders and Relatives	13.660	38.600
Total	13.660	38.600

INDEX OF CHARGES

S.No.	Charge ID	Date of Charge Creation/Modification	Charge amount secured	Charge Holder	Address	Service Request Number (SRN)
1	10117690	03/05/2012 *	712,132,000.00	AXIS BANK LIMITED	TRISHUL 3RD FLOOR OPP SAMARTHESHWAR TEMPLE, LAW GARDEN ELLISBRIDGE, AHMEDABAD, GUJARAT - 380006, INDIA	B39190178
2	10005642	23/02/2013 *	712,132,000.00	AXIS BANK LIMITED	M G HOUSE, RABINDRANATH TAGORE ROAD, BESIDE BOARD OFFICE, CIVIL LINES, NAGPUR, MAHARASHTRA - 440001  , INDIA	B68960921

* Date of charge modification

Fixed Assets:

Ø Computers

Ø Electrical Equipments

Ø Furniture and Fit

Ø Land

Ø Machinery and plant

Ø Car

Ø Buildings

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. 61.50
UK Pound	1	Rs. 99.49
Euro	1	Rs. 84.88

INFORMATION DETAILS

Information Gathered by :	PDT
Report Prepared by :	DPH

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	6
--PROFITABILIRY	1~10	6
--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	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTER
--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.