MIRA INFORM REPORT

Report Date :

09.05.2014

IDENTIFICATION DETAILS

Name :	KALANIKETAN SILKS PRIVATE LIMITED
Registered Office :	7-1-39, Flat No.604, 6^th Floor, Srinikethan Apartments, B K Guda, Ameerpet, Hyderabad – 500016, Andhra Pradesh
Country :	India
Financials (as on) :	31.03.2013
Date of Incorporation :	17.06.2005
Com. Reg. No.:	01-046575
Capital Investment / Paid-up Capital :	Rs.110.000 Millions
CIN No.: [Company Identification No.]	U18101AP2005PTC046575
TIN No.:	28490227546
TAN No.: [Tax Deduction & Collection Account No.]	HYDK03203E/ HYDK02966F
PAN No.: [Permanent Account No.]	AACCK6385P
Legal Form :	Private Limited Liability Company
Line of Business :	Subject is engaged in the retailing of Ready-Made Garments, Sarees etc.
No. of Employees :	1000 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

Ba (46)

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Satisfactory
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is an established company having satisfactory track. Trade relations are reported to be fair. Business is active. Payment are reported to be usually correct. The company can be considered 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.

ECGC Country Risk Classification List – March 31, 2014

Country Name	Previous Rating (31.12.2013)	Current Rating (31.03.2014)
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

US investment bank Goldman Sachs has upgraded its outlook on Indian markets as it expects positive impact of the election cycle.

India’s economy may grow 4.7 % in the current financial year, lower than the official estimate of 4.9 %, Fitch Rating said. The global rating agency expects the economy to pick up in the next two financial years.

Global ratings agency Standard & Poor said increasing focus by India Inc on lowering debt is likely to improve their credit profiles.

Singapore (1.1 million Indian tourists in 2012), Thailand (one million), the United Arab Emirates ().98 million) and Malaysia ().82 million) emerged as the preferred holidays hotspots for Indians. The total figure is expected to increase to 1.93 million by 2017, according to the latest Eurmonitor international report.

There is a $29.34 bn outward foreign direct investment by domestic companies between April and January of 2013/14 which has seen some signs of recovery according to a Care Ratings report.

There are 264 number of new companies being set up every day on average during 2014. Most of them are registered in Mumbai. India had 1.38 million registered companies at the end of January, 2014.

Twitter like messaging service Weibo Corporation has filed to raise $ 500 million via a US initial public offering. Alibaba, which owns a stake in Weibo is expected to raise about $ 15 billion New York this year in the highest profile Internet IPO since Facebook’s in 2012.

Bharti Airtel has raised Rs.2,453.2 crore (350 million Swiss Francs) by selling six-year bonds at a coupon rate of three per cent and maturing in 2020. This is the largest ever bond offering by an Indian company in Swiss Francs. Bharat Petroleum Corporation raised 175 million Swiss Francs by selling five year bonds at 2.98 % coupon rate in February.

Indian Oil Corporation plans to invest Rs.7650 crore in setting up a petrochemical complex at its almost complete Paradip refinery in Odhisha in three to four years. The company board is set to consider the setting up of a 700000 tonne per annum polypropylene plant at an estimated cost at Rs.3150 crore.

Global chief information officers at gathering in Bangalore in April to meet Indian startups at an event called Tech50 Watchout for Little Eye Labs-Facebook type deals in the making.

EXTERNAL AGENCY RATING

Rating Agency Name	CARE
Rating	Long Term Bank Facilities: BBB
Rating Explanation	Moderate degree of safety and moderate credit risk.
Date	03.06.2013

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 PARTED BY

Name :	Mr. Vijay
Designation :	EDP Head
Contact No.:	91-9246490023
Date :	06.05.2014

Name :	Mr. P. Srinivas
Designation :	Accounts Manager
Contact No.:	91-9246490007
Date :	06.05.2014

LOCATIONS

Registered Office :	7-1-39, Flat No.604, 6^th Floor, Srinikethan Apartments, B K Guda, Ameerpet, Hyderabad – 500016, Andhra Pradesh, India
Tel. No.:	Not Available
Mobile No.:	91-9246490023 (Mr. Vijay, EDP Head) 91-9246490007 (Mr. P. Srinivas, Accounts Manager)
Fax No.:	Not Available
E-Mail :	cvnath123@yahoo.com srinivas@kalanikethan.in
Website :	http://www.kalanikethan.in
Corporate Office :	#27-33-4,Gudavallivari Street, Governorpet, Vijayawada – 520002, Andhra Pradesh, India
Tel. No.:	91-866-2577881/ 82
Fax No.:	91-866-2577883
E-Mail :	chantikn@yahoo.com srinivas@kalanikethan.in
Area :	5000+ Sq. ft.
Location :	Leased

DIRECTORS

(AS ON 28.09.2013)

Name :

Mr. Nagabhushanam Vemuluri

Designation :

Managing Director

Address :

H. No. 8-2-248/A/512, Banjara Hills, Road No.03, Hyderabad – 500016, Andhra Pradesh, India

Date of Birth/Age :

11.03.1969

Qualification :

Graduate

Experience :

30 years

Date of Appointment :

17.01.2011

PAN No.:

ABIPV2941A

DIN No.:

01553113

Other Directorships :

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	Date of cessation	Company/ LLP Status	Defaulting status
1	U18101AP2003PTC041238	KALANIKETHAN TEXTILES AND JEWELS PRIVATE LIMITED	Director	26/06/2003	26/06/2003	02/07/2012	Active	NO
2	U01403AP2005PTC047875	JATIN NATURA FUELS PRIVATE LIMITED	Director	25/10/2005	25/10/2005	01/12/2009	Active	NO
3	U17299AP2005PTC048554	KALANIKETHAN FASHIONS PRIVATE LIMITED	Director	25/12/2005	25/12/2005	15/05/2011	Active	NO
4	U45200AP2005PTC045235	GRK CONSTRUCTIONS PRIVATE LIMITED	Director	10/05/2006	10/05/2006	-	Active	NO
5	U18101AP2005PTC046575	KALANIKETHAN SILKS PRIVATE LIMITED	Managing director	17/01/2011	20/05/2006	-	Active	NO
6	U74999AP2009PTC065560	B V DESIGNERS AND JEWELS INDIA PRIVATE LIMITED	Director	20/10/2009	20/10/2009	-	Strike off	NO
7	U52100AP2013PTC089845	DHANALAKSHMI TEXTRADE INDIA PRIVATE LIMITED	Director	04/09/2013	04/09/2013	-	Active

Name :

Mr. Suvarchala Vemuluri

Designation :

Director

Address :

H. No.33-10-16, srinivasa Rao Street, Seetharamapuram, Vijayawada, 520002, Andhra Pradesh, India

Date of Birth/Age :

05.06.1973

Qualification :

Graduate

Experience :

10 years

Date of Appointment :

16.07.2012

DIN No.:

05343376

Name :

Mr. Boyapati Ravikumar

Designation :

Director

Address :

40-7-2/B, Bonda Naga Mohan Street, Mogalraj Puram, Vijayawada – 520010, Andhra Pradesh, India

Date of Birth/Age :

01.05.1957

Qualification :

Graduate

Date of Appointment :

28.06.2012

DIN No.:

01237620

Other Directorships:

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	Date of cessation	Company/ LLP Status	Defaulting status
1	U45200AP1980PTC002629	KRISHNA ESTATES PVT LTD	Director	08/02/1980	08/02/1980	21/11/2012	Active	NO
2	U55102AP2006PTC049570	BVR MALLS PRIVATE LIMITED	Director	22/03/2006	22/03/2006	-	Active	NO
3	U74999AP2009PTC065560	B V DESIGNERS AND JEWELS INDIA PRIVATE LIMITED	Director	20/10/2009	20/10/2009	04/01/2013	Strike off	NO
4	U18101AP2005PTC046575	KALANIKETHAN SILKS PRIVATE LIMITED	Director	28/06/2012	28/06/2012	-	Active	NO

Name :

Mr. Penumtsa Srinivasa Raju

Designation :

Director

Address :

20-2-19, Ayodya Nagar, Vujayawada – 520007, Andhra Pradesh, India

Date of Birth/Age :

10.04.1964

Qualification :

Graduate

Date of Appointment :

15.09.2011

DIN No.:

03428744

Other Directorships:

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	Date of cessation	Company/ LLP Status	Defaulting status
1	U18101AP2005PTC046575	KALANIKETHAN SILKS PRIVATE LIMITED	Director	15/09/2011	15/02/2011	-	Active	NO

KEY EXECUTIVES

Name :	Mr. Vijay
Designation :	EDP Head
Name :	Mr. P. Srinivas
Designation :	Accounts Manager

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

(AS ON 28.09.2013)

Name of Shareholders	No of Shares
V Nagabhushanam	12662000
M. Padmaja W/o Kishore	150000
Srinivasa R. Tummalapenta and Nirmala R. Tummalapendra	254000
Indura Venkata Rama Reddy	101000
Indura Venkata Rama Reddy and Anupama	101000
Vemuluri Suvarchala	111500
P. Srinivasa Raju Guru	70000
Sighakolli Anasuya	100
Sighakolli Panduranga Rao	100
Sighakolli Panduranga Rao and Sons	100
Sighakolli Radha Krishna	100
Sighakolli Sundareswar	100
Total	13450000

(AS ON 30.09.2013)

Equity Shares Break – up

Category	Percentage
Directors or relatives of directors	94.97
Other top fifty shareholders	5.03
Total	100.00

BUSINESS DETAILS

Line of Business :	Subject is engaged in the retailing of Ready-Made Garments, Sarees etc.
Brand Names :	‘Kalanikethan’
Terms :
Selling :	Cash
Purchasing :	Cash

GENERAL INFORMATION

Customers :

Retailers

No. of Employees :

1000 (Approximately)

Bankers :

· HDFC Bank

HDFC Bank House Senapati Bapat Marg, Lower Parel (West), Mumbai – 400013, Maharashtra, India

· State Bank of India

SME BCH Ring Road, India

· Axis Bank Limited

59A 1-7, Matha Tower, Bishop’s House, Near Maris College, Benz Circle, Vijayawada – 520008, Andhra Pradesh, India

Facilities :

Credit Limit Rs.230.000 Millions from HDFC Bank

Credit Limit Rs.270.000 Millions from State Bank of India

Secured Loans	31.03.2013	31.03.2012
	(Rs. In Millions)
Long Term Borrowings
Rupee term loans from banks (Equitable Mortgage)	131.572	38.135
Short Term Borrowings
Working Capital Loans from Banks (Hypothecation o Inventory)	364.410	237.264
Loans repayable on demand from Banks (Secured by Bank Guarantee)	0.000	105.136
Total	495.982	380.535

Banking Relations :	--
Auditors :
Name :	T P Rao and Company Chartered Accountants
Address :	Plot No.32, Flat No.114, Huda Complex, Saroornagar, Hyderabad - 500035, Andhra Pradesh, India
PAN No.:	AAWPT7604F
Associates/Subsidiaries :	· K. N. Enterprises Brindavan Colony, Labbipet, Vijayawada, 520010, Andhra Pradesh, India Activity: Wholesale and Retails Business of Menswear.
Enterprises which are owned, or have significant influence of or are partners with Key management personnel and their relatives :	· Kalanikethan Textiles and Jewels Private Limited

CAPITAL STRUCTURE

(AS ON 28.09.2013)

Authorised Capital:

No. of Shares	Type	Value	Amount
20000000	Equity Shares	Rs.10/- each	Rs.200.000 Millions

Issued, Subscribed & Paid-up Capital:

No. of Shares	Type	Value	Amount
13450000	Equity Shares	Rs.10/- each	Rs.134.500 Millions

(AS ON 28.09.2013)

Authorised Capital:

No. of Shares	Type	Value	Amount
20000000	Equity Shares	Rs.10/- each	Rs.200.000 Millions

Issued, Subscribed & Paid-up Capital:

No. of Shares	Type	Value	Amount
11000000	Equity Shares	Rs.10/- each	Rs.110.000 Millions

FINANCIAL DATA

[All figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.03.2013	31.03.2012	31.03.2011
I. EQUITY AND LIABILITIES
(1)Shareholders' Funds
(a) Share Capital	110.000	110.000	60.000
(b) Reserves & Surplus	117.195	62.887	35.439
(c) Money received against share warrants	0.000	0.000	0.000
(2) Share Application money pending allotment	24.353	0.000	160.000
Total Shareholders’ Funds (1)+(2)	251.548	172.887	255.439
(3) Non-Current Liabilities
(a) long-term borrowings	322.482	184.049	37.503
(b) Deferred tax liabilities (Net)	12.545	9.364	7.480
(c) Other long term liabilities	0.000	0.000	0.000
(d) long-term provisions	0.000	0.000	0.000
Total Non-current Liabilities (3)	335.027	193.413	44.983
(4) Current Liabilities
(a) Short term borrowings	364.410	342.400	302.182
(b) Trade payables	318.525	89.289	12.684
(c) Other current liabilities	49.558	39.629	79.709
(d) Short-term provisions	23.500	11.600	0.326
Total Current Liabilities (4)	755.993	482.918	394.901
TOTAL	1,342.568	849.218	695.323
II. ASSETS
(1) Non-current assets
(a) Fixed Assets
(i) Tangible assets	334.520	192.629	148.276
(ii) Intangible Assets	0.000	0.000	0.000
(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	0.000	0.000	0.000
(e) Other Non-current assets	0.000	0.000	0.000
Total Non-Current Assets	334.520	192.629	148.276
(2) Current assets
(a) Current investments	0.000	0.000	0.000
(b) Inventories	775.891	495.420	369.097
(c) Trade receivables	0.987	3.354	3.117
(d) Cash and cash equivalents	32.347	64.069	59.665
(e) Short-term loans and advances	198.823	93.746	115.168
(f) Other current assets	0.000	0.000	0.000
Total Current Assets	1,008.048	656.589	547.047
TOTAL	1,342.568	849.218	695.323

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2013	31.03.2012	31.03.2011
	SALES
		Revenue from Operations	1925.216	1888.540	1624.340
		Other Income	0.000	0.000	0.000
		TOTAL (A)	1925.216	1888.540	1624.340
Less	EXPENSES
		Purchases of Stock-in-Trade	1756.905	1717.339	1427.058
		Changes in inventories of finished goods, work-in-progress and Stock-in-Trade	(280.471)	(126.324)	(24.302)
		Employees benefits expense	102.294	64.227	49.140
		Other expenses	207.816	143.340	105.170
		TOTAL (B)	1786.544	1798.582	1557.066
Less	PROFIT/(LOSS) BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		138.672	89.958	67.274
Less	FINANCIAL EXPENSES (D)		41.408	37.721	32.430
	PROFIT/(LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		97.264	52.237	34.844
Less/ Add	DEPRECIATION/ AMORTISATION (F)		16.363	11.305	14.117
	PROFIT/(LOSS) BEFORE TAX (E-F) (G)		80.901	40.932	20.727
Less	TAX (H)		26.593	13.484	8.042
	PROFIT/(LOSS) AFTER TAX (G-H) (I)		54.308	27.448	12.685
	Earnings Per Share (Rs.)		4.94	4.66	2.11

KEY RATIOS

PARTICULARS		31.03.2013	31.03.2012	31.03.2011
PAT / Total Income	(%)	2.82	1.45	0.78
Net Profit Margin (PBT/Sales)	(%)	4.20	2.17	1.28
Return on Total Assets (PBT/Total Assets}	(%)	6.03	4.82	2.98
Return on Investment (ROI) (PBT/Networth)		0.32	0.24	0.08
Debt Equity Ratio (Total Debt/Networth)		2.73	3.05	1.33
Current Ratio (Current Asset/Current Liability)		1.33	1.36	1.39

FINANCIAL ANALYSIS

[All figures are in Rupees Millions]

DEBT EQUITY RATIO

Particular	31.03.2011	31.03.2012	31.03.2013
	(INR in Mlns.)	(INR in Mlns.)	(INR in Mlns.)
Share Capital	60.000	110.000	110.000
Reserves & Surplus	35.439	62.887	117.195
Share Application money pending allotment	160.000	0.000	24.353
Net worth	255.439	172.887	251.548
long-term borrowings	37.503	184.049	322.482
Short term borrowings	302.182	342.400	364.410
Total borrowings	339.685	526.449	686.892
Debt/Equity ratio	1.330	3.045	2.731

YEAR-ON-YEAR GROWTH

Year on Year Growth	31.03.2011	31.03.2012	31.03.2013
	(INR in Mlns)	(INR in Mlns)	(INR in Mlns)
Revenue from Operations	1,624.340	1,888.540	1,925.216
		16.265	1.942

NET PROFIT MARGIN

Net Profit Margin	31.03.2011	31.03.2012	31.03.2013
	(INR)	(INR)	(INR)
Revenue from Operations	1,624.340	1,888.540	1,925.216
Profit	12.685	27.448	54.308
	0.78%	1.45%	2.82%

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

UNSECURED LOANS

PARTICULARS	31.03.2013	31.03.2012
	(Rs. In Millions)
Long Term Borrowings
Loans and Advance from Directors	5.910	5.915
Loans and Advance from Others	185.000	140.000
Total	190.910	145.915

BUSIENSS ACTIVITY

During the year, company expanded its business to various core areas in view of this it purchased more assets and also increased the stock limit and the company is able to achieve a profit of Rs.80.900 Millions (Previous year profit is Rs.40.900 Millions) and also establish well in consumers mind. The management is hopeful to achieve good results in upcoming year also.

INDEX OF CHARGES:

S. No.	Charge ID	Date of Charge Creation/Modification	Charge amount secured	Charge Holder	Address	Service Request Number (SRN)
1	10453499	26/08/2013	310,000,000.00	STATE BANK OF INDIA	D.NO 48-10-20, VEERAMACHANENI RESIDENCY, NEAR NTR HEALTH UNIVERSITY CAMPUS, VIJAYAWADA, ANDHRA PRADESH - 520004, INDIA	B86856986
2	10191473	07/12/2013 *	415,000,000.00	HDFC BANK LIMITED	HDFC BANK HOUSESENAPATI BAPAT MARG, LOWER PAREL W, MUMBAI, MAHARASHTRA - 400013, INDIA	B92528066

* Date of charge modification

FIXED ASSETS:

· Buildings

· Office Building

· Furniture and Fixtures

· Vehicles

· Motor Vehicles

· Office Equipment

· Computer

· 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.60.047
UK Pound	1	Rs.101.97
Euro	1	Rs.83.58

INFORMATION DETAILS

Information Gathered by :	SVA
Analysis Done by :	SUM
Report Prepared by :	NIT

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	5
--RESERVES	1~10	5
--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		46

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	--

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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.