MIRA INFORM REPORT

Report Date :

28.08.2014

IDENTIFICATION DETAILS

Name :	JR METAL CHENNAI LIMITED
Registered Office :	No.3, Manali High Road, TKS Nagar, Tiruvottiyur, Chennai - 600019, Tamilnadu
Country :	India
Financials (as on) :	31.03.2014
Date of Incorporation :	26.11.2008
Com. Reg. No.:	18-069998
Capital Investment / Paid-up Capital :	Rs. 461.259 Millions
CIN No.: [Company Identification No.]	U27310TN2008PLC069998
PAN No.: [Permanent Account No.]	AACCJ0990P
Legal Form :	A Closely Held Public Limited Liability Company
Line of Business :	Manufacturer of TMT Bars, MS Angles, Mild Steel Billets, CRS Re-Bars, etc.
No. of Employees :	325 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

B (28)

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

Status :	Moderate
Payment Behaviour :	Slow
Litigation :	Clear
Comments :	Subject was setup in 2008 but commenced commercial production only in April 2011. It is a company having moderate track as a result of limited operational history during the year under review. The company possesses a moderate financial profile marked by adequate networth comprising of low reserves which is further mitigated by infusion of funds from the promoters. Management has witnesses dip in its sales volume as well as has reported a low profit margin during FY14. However, trade relations seem to be fair. Business is active. Payment terms are reported as slow. In view of infancy, the company can be considered for business dealing with great 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 – June 1, 2014

Country Name	Previous Rating (31.03.2014)	Current Rating (01.06.2014)
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

N E W S

As per the latest IMF study, the total weigh of emerging markets in the GDP of the world on a purchasing power parity basis has seen a sizeable shift. It highlights how as against 51 % in 2005, the emerging economies now account for close to 56 % of the global purchasing power GDP as per the latest survey. And with the emerging economies growing at a faster rate than their developed counterparts, there are every possibility that the their share goes up further in the coming years.  China may surpass the US over the next few years.

Politics and economics are very intricately connected. They tend to influence each other in ways that could be very complex and far-reaching. The prospects of the India’s economy have been seriously compromised due to political corruption. High inflation, poor standard of living are to a great extent a result of rampant corruption in the country. China on the other hand, seems to be facing diametrically opposite challenge. American hedge fund manager Jim Chanos has been keenly following the political and economic development in the dragon economy and has figured out something that is quite worrying. He is of the view that the Chinese economy could be heading toward trouble on account of new Chinese President Xi Jingping’s very aggressive anti-corruption drive. Chanos believes tat many things such as apartment sales, luxury products, etc. were largely bought with dirty money. And it is now beginning to impact consumption. This may indeed be bad news for an economy that is struggling to transition from an investment-driven export-oriented economy to a domestic consumption-driven economy.

A study published by Firstpost has revealed that asset classes like real estate and equities were the biggest beneficiaries of the liberalization policies.  A firm called Ciane Analytics studied returns from assets including equities, gold, fixed deposits, G-Secs and real estate since 1991. Real estate outperformed every other asset classes during the 23-year period with an annualized return of 20 % ! Equities came in second with annualized return of 15.5 % ! However, while these returns may seem mouthwatering, the fact is that the return from equities adjusted for inflation came down to just 7.1 %.

Some brief news are as under

. R-Power to buy Jaypee’s hydro assets

. Investors await justice in NSEL case

. India seeks MFN status from Pakistan ahead of meeting

. Ukrain’s clashes with rebels hinder MH17 crash investigation

. India exploring merger of state-owned hydro PSUs

..Higher costs weigh down profit growth to slowest in 9 quarters

..Wal-Mart to expand wholesale business in India

. GMR group moves to strengthen balance sheet

. Central Bank to sell 4 % stake to Life Insurance Corporation

. Tata Chemicals plans to raise up to Rs 10000 mn.

EXTERNAL AGENCY RATING

Rating Agency Name	CRISIL
Rating	Long Term Rating “D” (Suspended)
Rating Explanation	Lowest credit quality and very low prospects of recovery
Date	01.11.2013

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 31-03-2014.

INFORMATION PARTED BY

Name :	Mr. Subhash Sharma
Designation :	Account Manager
Contact No.:	91-9444079705
Date :	27.08.2014

LOCATIONS

Registered Office :	No.3, Manali High Road, TKS Nagar, Tiruvottiyur, Chennai - 600019, Tamilnadu, India
Tel. No.:	91-44-25741116 / 25741216 / 25741316 /  25741416 / 25740305
Mobile No.:	91-9444079705 (Mr. Subhash Sharma)
Fax No.:	Not Available
E-Mail :	info@jrmetalchennai.com sales@jrmetalchennai.com kumaran@vsnl.in
Website :	http://www.jrmetalchennai.com
Factory :	Periyapuliyur Village, Poovalambedu Post, Gummidipoondi, Thiruvallur, Chennai – 601206, Tamilnadu, India
Tel. No.:	91-44-25741965

DIRECTORS

As on 28.09.2013

Name :	Mr. Narayan Singh Ram Chander Singh
Designation :	Director
Address :	85/1, T H Road, Kalapet Chennai – 600019, Tamilnadu, Indian
Date of Birth/Age :	21.01.1971
Date of Appointment :	26.11.2008
DIN No.:	02039316
PAN No.:	ACAPN1404D
Name :	Mr. Ramachandran Ranganathan
Designation :	Additional Director
Address :	204, Lake View Road, West Mambalam, Chennai – 600033, Tamilnadu, Indian
Date of Birth/Age :	05.05.1956
Date of Appointment :	06.04.2012
DIN No.:	05339166
PAN No.:	AIZPR2875F
Name :	Mr. Shailendra Nath Mishra
Designation :	Additional Director
Address :	No1. Vivekananthar Street, 4^th street Old Gummudipoondi, Thiruvallur, Chennai – 601201, Tamilnadu, India
Date of Birth/Age :	02.04.1964
Date of Appointment :	06.04.2012
DIN No.:	05339168
PAN No.:	CAWPS3471D

KEY EXECUTIVES

Name :	Mr. Subhash Sharma
Designation :	Account Manager

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 28.09.2013

SHAREHOLDING DETAILS FILE ATTACHED

As on 28.09.2013

Equity Share Break up (Percentage of Total Equity)

Category	Percentage
Bodies corporate	19.70
Directors or relatives of Directors	58.20
Other top fifty shareholders	9.00
Others	13.10
Total	100.00

BUSINESS DETAILS

Line of Business :

Manufacturer of TMT Bars, MS Angles, Mild Steel Billets, CRS Re-Bars, etc.

Products :

Description of product or service	ITC code
Bars and Rods of Lead Bearing Steel	72283021

Imports :

Products :

Raw Material

Countries :

· South Africa

· Singapore

· UK

Terms :

Selling :

Cash / Advance Payment

Purchasing :

Cash / Advance Payment

GENERAL INFORMATION

Customers :

Wholesalers

No. of Employees :

325 (Approximately)

Bankers :

· HDFC Bank Limited, HDFC Bank Housesenapati Bapat Marg, Lower Parel West, Mumbai - 400013, Maharashtra, India

· Oriental Bank of Commerce, Teyment peth, Chennai, Tamilnadu, India

· UCO Bank, Chennai Main Branch

Facilities :

Term Loan = 75.000 Millions, Cash Credit = 25.000 Millions and LC = Rs.150.000 Millions (From Oriental Bank of Commerce)

Term Loan = 75.000 Millions, Cash Credit = 25.000 Millions and LC = Rs.150.000 Millions (From UCO Bank)

(Rs. In Millions)

Secured Loan	As on 31.03.2014	As on 31.03.2013
Long-term borrowings
Rupee term loans from banks	NA	86.077
Loans taken for vehicles	NA	4.347
Short-term borrowings
Rupee term loans from banks	NA	52.785
Total	NA	143.209

Banking Relations :	---
Auditors :
Name :	V Narayanan and Company Chartered Accountants
Address :	No 23, Cv Raman Road, Alwarpet
PAN No.:	AADFV3471F
Enterprises which are owned, or have significant influence of or are partners with Key management personnel and their relatives : (As on 31.03.2013)	· Janaki Ram Steel and Power Private Limited · Indo Steel Re Rollers · Narayan Industries · Sri Vadivudai Amman Steel Company · JRS Container Terminal Private Limited · Sri Kamaran Wind Energy Private Limited

CAPITAL STRUCTURE

As on 31.03.2014

Authorised Capital : Not Available

Issued, Subscribed & Paid-up Capital : Rs.461.259 Millions

As on 28.09.2013

Authorised Capital :

No. of Shares	Type	Value	Amount
50000000	Equity Shares	Rs.10/- each	Rs.500.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
39675286	Equity Shares	Rs.10/- each	Rs.396.753 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.03.2014	31.03.2013	31.03.2012
I. EQUITY AND LIABILITIES
(1)Shareholders' Funds
(a) Share Capital	461.259	396.753	396.753
(b) Reserves & Surplus	45.541	24.399	10.813
(c) Money received against share warrants	0.000	0.000	0.000
(2) Share Application money pending allotment	0.072	51.828	0.000
Total Shareholders’ Funds (1) + (2)	506.872	472.980	407.566
(3) Non-Current Liabilities
(a) long-term borrowings	116.918	90.424	104.518
(b) Deferred tax liabilities (Net)	5.960	5.960	5.554
(c) Other long term liabilities	0.000	0.000	0.000
(d) long-term provisions	0.408	0.407	0.144
Total Non-current Liabilities (3)	123.286	96.791	110.216
(4) Current Liabilities
(a) Short term borrowings	48.128	52.785	60.816
(b) Trade payables	436.835	572.566	586.545
(c) Other current liabilities	140.400	77.128	65.953
(d) Short-term provisions	6.563	0.001	0.000
Total Current Liabilities (4)	631.926	702.480	713.314
TOTAL	1262.084	1272.251	1231.096
II. ASSETS
(1) Non-current assets
(a) Fixed Assets
(i) Tangible assets	318.896	347.831	372.179
(ii) Intangible Assets	0.374	0.623	0.735
(iii) Capital work-in-progress	0.000	0.000	0.000
(iv) Intangible assets under development	0.000	0.000	0.000
(b) Non-current Investments	0.000	0.000	0.000
(c) Deferred tax assets (net)	0.000	0.000	0.000
(d) Long-term Loan and Advances	60.191	57.090	22.524
(e) Other Non-current assets	0.091	0.091	0.182
Total Non-Current Assets	379.552	405.635	395.620
(2) Current assets
(a) Current investments	0.000	0.000	0.000
(b) Inventories	302.907	310.747	183.911
(c) Trade receivables	462.957	444.889	481.539
(d) Cash and cash equivalents	45.546	43.659	77.450
(e) Short-term loans and advances	10.473	12.710	32.194
(f) Other current assets	60.649	54.611	60.382
Total Current Assets	882.532	866.616	835.476
TOTAL	1262.084	1272.251	1231.096

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2014	31.03.2013	31.03.2012
	SALES
		Income	2515.876	3148.550	2478.746
		Other Income	40.006	87.741	4.976
		TOTAL (A)	2555.882	3236.291	2483.722
Less	EXPENSES
		Cost of Materials Consumed	1046.948	1471.819	1009.634
		Purchases of Stock-in-Trade	491.063	832.749	715.316
		Changes in inventories of finished goods, work-in-progress and Stock-in-Trade	(28.567)	(103.824)	16.401
		Direct Expenses	886.969	875.150	0.000
		Employees benefits expense	8.286	5.437	3.910
		Directors Remuneration	1.200	2.580	0.000
		Other expenses	21.453	25.831	602.078
		Prior Period Items	0.000	0.000	(0.626)
		TOTAL (B)	2427.352	3109.742	2346.713
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		128.530	126.549	137.009
Less	FINANCIAL EXPENSES (D)		43.191	47.496	52.967
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		85.339	79.053	84.042
Less/ Add	DEPRECIATION/ AMORTISATION (F)		53.670	58.734	65.373
	PROFIT BEFORE TAX (E-F) (G)		31.669	20.319	18.669
Less	TAX (H)		10.527	6.734	6.073
	PROFIT AFTER TAX (G-H) (I)		21.142	13.585	12.596
	Earnings Per Share (Rs.)		0.05	0.34	0.73

KEY RATIOS

PARTICULARS		31.03.2014	31.03.2013	31.03.2012
PAT / Total Income	(%)	0.83	0.42	0.51
Net Profit Margin (PBT/Sales)	(%)	1.26	0.65	0.75
Return on Total Assets (PBT/Total Assets}	(%)	2.51	1.60	1.52
Return on Investment (ROI) (PBT/Networth)		0.06	0.04	0.05
Debt Equity Ratio (Total Debt /Networth)		0.33	0.30	0.41
Current Ratio (Current Asset/Current Liability)		1.40	1.23	1.17

FINANCIAL ANALYSIS

[all figures are in Rupees Millions]

DEBT EQUITY RATIO

Particular	31.03.2012	31.03.2013	31.03.2014
	(Rs. In Millions)	(Rs. In Millions)	(Rs. In Millions)
Share Capital	396.753	396.753	461.259
Reserves & Surplus	10.813	24.399	45.541
Share Application money pending allotment	0.000	51.828	0.072
Net worth	407.566	472.980	506.872
long-term borrowings	104.518	90.424	116.918
Short term borrowings	60.816	52.785	48.128
Total borrowings	165.334	143.209	165.046
Debt/Equity ratio	0.406	0.303	0.326

YEAR-ON-YEAR GROWTH

Year on Year Growth	31.03.2012	31.03.2013	31.03.2014
	(Rs. In Millions)	(Rs. In Millions)	(Rs. In Millions)
Sales	2478.746	3148.550	2515.876
		27.022	-20.094

NET PROFIT MARGIN

Net Profit Margin	31.03.2012	31.03.2013	31.03.2014
	(Rs. In Millions)	(Rs. In Millions)	(Rs. In Millions)
Sales	2478.746	3148.550	2515.876
Profit	12.596	13.585	21.142
	0.51%	0.43%	0.84%

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	Yes
10]	Designation of contact person	Yes
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	Yes
20]	Export / Import details (if applicable)	Yes
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	Yes
33]	Voter ID No of Proprietor/Partner/Director, if available	No
34]	External Agency Rating, if available	Yes

CORPORATE INFORMATION

Subject is a public company domiciled in India and incorporated on 26th day of November, 2008, under the provisions of the Companies Act, 1956 with registrar of companies, Tamilnadu vide CIN No. U27310TN2008PLC069998. Its shares are not listed in stock exchanges in India. The company is engaged in the manufacture and trading of TMT Rebars and Billets.

INDEX OF CHARGES

S.No.	Charge ID	Date of Charge Creation/Modification	Charge amount secured	Charge Holder	Address	Service Request Number (SRN)
1	10262290	06/12/2010	4,250,000.00	HDFC BANK LIMITED	HDFC BANK HOUSESENAPATI BAPAT MARG, LOWER PAREL W, MUMBAI, MAHARASHTRA - 400013, INDIA	B04423489
2	10254035	20/10/2010	1,900,000.00	HDFC BANK LIMITED	HDFC BANK HOUSESENAPATI BAPAT MARG, LOWER PAREL W, MUMBAI, MAHARASHTRA - 400013, INDIA	B00865501
3	10204922	14/06/2010 *	490,000,000.00	ORIENTAL BANK OF COMMERCE (OVERSEAS BRANCH) AND UC  O BANK MID CORPORATE BRANCH CHENNAI 600001	OVERSEAS BRANCH, PADMA COMPLEX, 467, ANNA SALAI,  TEYNAMPET, CHENNAI, TAMILNADU - 600018, INDIA	A89015366
4	10176579	02/09/2009	600,000.00	HDFC BANK LIMITED	HDFC BANK HOUSESENAPATI BAPAT MARG, LOWER PAREL W, MUMBAI, MAHARASHTRA - 400013, INDIA	A70166236
5	10149052	03/03/2009	700,000.00	HDFC BANK LIMITED	HDFC BANK HOUSESENAPATI BAPAT MARG, LOWER PAREL W, MUMBAI, MAHARASHTRA - 400013, INDIA	A58650961

* Date of charge modification

FIXED ASSETS

· Buildings

· Plant and equipment

· Furniture and fixtures

· Vehicles

· Office equipment

· Computer equipments

· Other equipments

CMT REPORT (Corruption, Money Laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No 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] 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.60.47
UK Pound	1	Rs.100.15
Euro	1	Rs.79.65

INFORMATION DETAILS

Information Gathered by :	SVA
Analysis Done by :	SUB
Report Prepared by :	NTH

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	3
PAID-UP CAPITAL	1~10	4
OPERATING SCALE	1~10	3
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	3
--PROFITABILIRY	1~10	3
--LIQUIDITY	1~10	3
--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		28

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.