MIRA INFORM REPORT

Report Date :

03.09.2013

IDENTIFICATION DETAILS

Name :	STERLING STONEX PRIVATE LIMITED
Registered Office :	2-98/3, 10-B, Kakatiya Nagar, Habsiguda, Hyderabad – 500 007, Andhra Pradesh
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	04.09.1995
Com. Reg. No.:	01-021590
Capital Investment / Paid-up Capital :	Rs.7.500 Millions
CIN No.: [Company Identification No.]	U14101AP1995PTC021590
Legal Form :	Private Limited Liability Company
Line of Business :	Subject is engaged in the business of mining and export of dimensional colour granites blocks and processing of monuments and memorials for export.
No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

B (29)

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Maximum Credit Limit :	USD 322000
Status :	Moderate
Payment Behaviour :	Unknown
Litigation :	Clear
Comments :	Subject is an established company having moderate track record. Management of the company has failed to file its latest financial with Government Department. As per financials of 2011, performance of the company appears to be satisfactory. Trade relations are fair. Business is active. Payments are unknown due to absence of latest financial. The company can be considered for business dealing with some caution.

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

We are living in a world where volatility and uncertainty have become the New Normal. We saw a change of government in countries like Tunisia, Egypt, Libya and Vietnam. Once powerful countries in Europe are now fighting for bankruptcy. We have taken growth in the developing part of the world for granted but economic growth in China and India has begun to slow. Companies that were synonymous with their product categories just a few years ago are now no longer in existence. Kodak, the inventor of the digital camera had to wind up its operations, HMV, the British entertainment retailing company and Borders, once the second largest bookstore have shut down due to their inability to evolve their business models with the changing time. Readers’ Digest, Thomson Register are no more !

There is another megatrend happening. The World order is changing as economic power shifts from West to East. According to McKinsey study, it took Britain more than 100 years to double its economic output per person during its industrial revolution and the US later took more than 50 years to do the same. More than a century later, China and India have doubled their GDP per capital in 12 and 18 years respectively. By 2020, emerging Asia will become the world’s largest consuming block, overtaking North America.

The years after the outbreak of the global financial crisis, the world economy continues to remain fragile. The Indian economy demonstrated remarkable resilience in the initial years of the contagion but finally lost ground last year. GDP growth slowed down. Currency has been weakening. There is a marked deceleration in agriculture, industry and services. Dampening sentiment led to a cut-back in investment as well as private consumption expenditure.  Inflation remained at high levels fuelled by the pressure from the food and fuel sectors. The large fiscal and current account deficit s continued to cause grave concern. It is imperative that India regains its growth trajectory of 8-9 % sooner than later. This is crucially important given the need to create gainful livelihood opportunities for the millions living in poverty as also the large contingent of young people joining the job market every year.

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 :	2-98/3, 10-B, Kakatiya Nagar, Habsiguda, Hyderabad – 500 007, Andhra Pradesh, India
Tel. No.:	91-40-27153096/ 27155201
Fax No.:	91-40-27172188
E-Mail :	info@sterlingstonex.com n_muneyya@rediffmail.com sspl@ksrgroup.in
Website :	www.sterlingstonex.com
Location :	Owned
Factory :	Located at: · Kondamadugu, Andhra Pradesh

DIRECTORS

AS ON 30.09.2011

Name :

Mr. Koneru Venkateswara Rao

Designation :

Managing Director

Address :

2-98/3, 10-B, Block-B, Kakatiya Nagar, Habsiguda, Hyderabad - 500 007, Andhra Pradesh, India

Date of Birth/Age :

15.08.1962

Date of Appointment :

04.09.1995

DIN No.:

00623241

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Company/ LLP Status	Defaulting status
1	U14101AP1995PTC021590	STERLING STONEX PRIVATE LIMITED	Managing director	04-09-95	04-09-95	Active	NO
2	U45203AP2004PTC043273	KSR INFRACON PRIVATE LIMITED	Managing director	19-05-04	19-05-04	Active	NO
3	U74120MH2011PTC225593	MAX FERECOV PRIVATE LIMITED	Managing director	30-12-11	30-12-11	Active	NO

Name :

Mr. Koneru Srinivas Rao

Designation :

Director

Address :

2-98/3, 10-B, Block-B, Kakatiya Nagar, Habsiguda, Hyderabad - 500 007, Andhra Pradesh, India

Date of Birth/Age :

19.06.1963

Date of Appointment :

04.09.1995

DIN No.:

00623243

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Company/ LLP Status	Defaulting status
1	U14101AP1995PTC021590	STERLING STONEX PRIVATE LIMITED	Director	04-09-95	04-09-95	Active	NO
2	U45203AP2004PTC043273	KSR INFRACON PRIVATE LIMITED	Director	19-05-04	19-05-04	Active	NO

Name :

Mr. Koneru Tirumala Rao

Designation :

Director

Address :

2-98/3, 10-B, Block-B, Kakatiya Nagar, Habsiguda, Hyderabad - 500 007, Andhra Pradesh, India

Date of Birth/Age :

28.11.1970

Date of Appointment :

04.09.1995

DIN No.:

00623247

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Company/ LLP Status	Defaulting status
1	U14101AP1995PTC021590	STERLING STONEX PRIVATE LIMITED	Director	04-09-95	04-09-95	Active	NO
2	U45203AP2004PTC043273	KSR INFRACON PRIVATE LIMITED	Director	19-05-04	19-05-04	Active	NO

MAJOR SHAREHOLDERS

AS ON 30.09.2011

Names of Shareholders	No. of Shares
Koneru Venkateswara Rao	200000
Koneru Srinivas Rao	175000
Koneru Tirumala Rao	175000
Koneru Padmaja	50000
Koneru Madhavi	50000
Koneru Vasundhara	50000
Koneru Prameela Devi	50000
Total	750000

Equity Share Break up (Percentage of Total Equity)

AS ON 30.09.2011

Category	Percentage
Directors or relatives of Directors	100.00
Total	100.00

BUSINESS DETAILS

Line of Business :	Subject is engaged in the business of mining and export of dimensional colour granites blocks and processing of monuments and memorials for export.
Products/ Services :	· Monuments and memorials in Granite · Mining of dimensional color granite blocks

GENERAL INFORMATION

No. of Employees :

Not Available

Bankers :

· State Bank of India, Nacharam SME Branch, Hyderabad – 500 076, Andhra Pradesh, India

· Allahabad Bank, Industrial Finance Branch, 115 Park Lane, Secunderabad – 500 003, Andhra Pradesh, India

· HDFC Bank Limited, HDFC Bank House, Senapati Bapat Marg, Lower Parel (West), Mumbai - 400 013, Maharashtra, India

Facilities :

SECURED LOANS	31.03.2011 (Rs. in millions)	31.03.2010 (Rs. in millions)
LONG TERM BORROWINGS
Loans and Advances from Banks
- Term Loans (Secured by the machinery purchased under the loan)	1.252	1.621
-Working Capital Loans (Secured by all the current assets of the company)	27.732	22.820
Other Loans and Advances (HP Loans- Secured by the assets acquired under the loan)	35.630	12.171
Total	64.614	36.612

Banking Relations :	--
Auditors :
Name :	Ratnam Dhaveji and Company Chartered Accountants
Address :	A-6, Durgabai Deshmukh Colony, OU Road, Hyderabad – 500 007, Andhra Pradesh, India
PAN No.:	AAEFR4217Q
Enterprise in which KMP have significant influence or control :	K. Seshagiri Rao and Company KSR Infracon Private Limited Sterling Granites Sterling Crane Hirers Sterling Metals

CAPITAL STRUCTURE

AS ON 30.09.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
750000	Equity Shares	Rs.10/- each	Rs.7.500 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
750000	Equity Shares	Rs.10/- each	Rs.7.500 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2011	31.03.2010	31.03.2009
SHAREHOLDERS FUNDS
1] Share Capital		7.500	7.500	3.000
2] Share Application Money		0.700	0.700	0.144
3] Reserves & Surplus		72.449	68.933	63.118
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		80.649	77.133	66.262
LOAN FUNDS
1] Secured Loans		64.614	36.612	40.882
2] Unsecured Loans		2.044	1.423	2.057
TOTAL BORROWING		66.658	38.035	42.939
DEFERRED TAX LIABILITIES		6.020	4.739	4.024
TOTAL		153.327	119.907	113.225
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		104.313	71.149	65.305
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		0.000	0.000	0.000
DEFERRED TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	24.909	17.920	31.898
	Sundry Debtors	29.897	26.338	23.791
	Cash & Bank Balances	2.765	3.957	0.305
	Other Current Assets	41.626	26.095	17.138
	Loans & Advances	0.078	0.270	4.650
Total Current Assets		99.275	74.580	77.782
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	32.797	11.004	18.282
	Other Current Liabilities	1.090	0.771	0.262
	Provisions	16.374	14.047	11.318
Total Current Liabilities		50.261	25.822	29.862
Net Current Assets		49.014	48.758	47.920
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		153.327	119.907	113.225

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Gross Receipts
		Other Income
		TOTAL (A)	103.001	121.508	112.848
Less	EXPENSES
		Office Expenses
		Administrative Expenses
		Advertising Expenses
		TOTAL (B)	82.531	101.464	93.599
Less	PROFIT/(LOSS) BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		20.470	20.044	19.249
Less	FINANCIAL EXPENSES (D)		6.345	5.317	6.839
	PROFIT/(LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		14.125	14.727	12.410
Less/ Add	DEPRECIATION/ AMORTISATION (F)		5.579	4.592	4.276
	PROFIT/(LOSS) BEFORE TAX (E-F) (G)		8.546	10.135	8.134
Less	TAX (H)		2.866	3.440	0.886
	PROFIT/(LOSS) AFTER TAX (G-H) (I)		5.680	6.695	7.248
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		19.565	18.863	17.427
Less	APPROPRIATIONS
		Transfer to General Reserve	6.071	5.112	4.935
		Dividend	1.875	0.753	0.750
		Tax on Dividend	0.290	0.128	0.127
	BALANCE CARRIED TO THE B/S		17.009	19.565	18.863
	Earnings Per Share (Rs.)		7.57	22.23	24.16

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	5.51	5.50	6.42
Return on Total Assets (PBT/Total Assets}	(%)	4.20	6.95	5.68
Return on Investment (ROI) (PBT/Networth)		0.11	0.13	0.12
Debt Equity Ratio (Total Debt /Networth)		0.83	0.49	0.65
Current Ratio (Current Asset/Current Liability)		1.98	2.89	2.60

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	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	No

UNSECURED LOANS:

PARTICULARS	31.03.2011 (Rs. In Millions)	31.03.2010 (Rs. In Millions)
SHORT TERM BORROWINGS
Sort Term Loans and Advances
-From Banks	0.009	0.009
-From Directors	1.043	0.421
-From Others	0.992	0.993
Total	2.044	1.423

INDEX OF CHARGE:

Sr .No.	Charge ID	Date of Charge Creation/Modification	Charge amount secured	Charge Holder	Address	Service Request Number (SRN)
1	10380299	18/09/2012	547,200.00	AXIS BANK LIMITED	ASC CENTER, 5-2-183/184, LLL FLOOR, R.P ROAD, SECUNDERABAD - 500 003, ANDHRA PRADESH, INDIA	B59554964
2	10374027	17/07/2012	4,800,000.00	MAGMA FINCORP LIMITED	MAGMA HOUSE, 24 PARK STREET, KOLKATA - 700 016, WEST BENGAL, INDIA	B57064230
3	10262606	05/01/2011	17,600,000.00	SREI EQUIPMENT FINANCE PRIVATE LIMITED	'VISHWAKARMA', 86C, TOPSIA ROAD, KOLKATA - 700 046, WEST BENGAL, INDIA	B03735719
4	10254049	31/10/2010	10,151,722.00	TATA CAPITAL LIMITED	ONE FORBES, DR V B GANDHI MARG,FORT, MUMBAI - 400 001, MAHARASHTRA, INDIA	B00586651
5	10250729	29/09/2010	2,640,000.00	HDFC BANK LIMITED	HDFC BANK HOUSESENAPATI BAPAT MARG, LOWER PAREL WEST, MUMBAI - 400013, MAHARASHTRA, INDIA	A99170805
6	10093488	18/03/2008	5,603,200.00	GE CAPITAL TRANSPORTATION FINANCIAL SERVICES LTD	AIFACS BUILDING,, 1, RAFI MARG, , NEW DELHI, DELHI - 110001, INDIA	A34463034
7	10034373	19/12/2012 *	49,000,000.00	STATE BANK OF INDIA	NACHARAM SME BRANCH, NACHARAM, HYDERABAD - 500076, ANDHRA PRADESH, INDIA	B68035567
8	90118008	20/12/2004	260,000.00	HDFC BANK HOUSE	SENAPATI BAPAT MARG;LOWER PAREL (WEST), MUMBAI - 400013, MAHARASHTRA, INDIA	-
9	90116442	02/12/2004	3,410,775.00	ABN AMRO BANK N.V	DLF CENTRE;SANSAD MARG, SOMAJIGUDA, NEW DELHI, DELHI - 11000, INDIA	-
10	90116411	31/07/2004	2,500,000.00	ABN AMRO BANK N.V	DLF CENTRE;SANSAD MARG, SOMAJIGUDA, NEW DELHI, DELHI - 11000, INDIA	-

* Date of charge modification.

CORPORATE INFORMATION AND NATURE OF OPERATIONS:

The Company is a part of KSR Group of Hyderabad, India with varied interests in granite mining and processing and specialty contracts in the infrastructure space.

Subject is engaged in the business of mining and export of dimensional colour granites blocks and processing of monuments and memorials for export.

PERFORMANCE, OPERATIONS AND FUTURE OUTLOOK:

During the period the Company has received good orders from various clients and has executed the orders to their satisfaction. The Company has been receiving enquiries and repetitive orders from various clients for its products. The Directors are hopeful of achieving growth in turnover in the current fiscal year.

The year in retrospect witnessed signs of slump in the economy and overall recessionary trend across the globe. However due to the very nature of the activities of the company, there is no much impact on the operations. During the year the company registered turnover and other income of Rs.103.001 Millions as against Rs.121.508 Millions, in the previous year. While the profit Before Tax has improved from Rs.20.044 Millions in 2009-10 to Rs.20.470 Millions in 2010-11, the profit After Tax, in comparison, has decreased from Rs.6.696 Millions to Rs.5.680 Millions Mainly due to higher depreciation charge and financial expenses.

The Company is contemplating increase in capacity as the plant load factor has reached almost 85% and in view of possible orders from new clients across Europe. The marketing efforts of the company are now bearing fruit and will yield good results once the expansion takes place. The Director are working on the expansion plans during the current fiscal year. The Directors are hopeful that, barring unforeseen circumstances, the Company will post better growth in the current year.

FIXED ASSETS:

· Land and Development

· Factory Building

· Plant and Machinery

· Electrical Equipment

· Office Equipment

· Vehicles

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.65.86
UK Pound	1	Rs.102.52
Euro	1	Rs.87.06

INFORMATION DETAILS

Report Prepared by :

NKT

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	3
PAID-UP CAPITAL	1~10	3
OPERATING SCALE	1~10	3
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	3
--PROFITABILIRY	1~10	4
--LIQUIDITY	1~10	4
--LEVERAGE	1~10	3
--RESERVES	1~10	3
--CREDIT LINES	1~10	3
--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		29

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.