MIRA INFORM REPORT

Report Date :

31.05.2014

IDENTIFICATION DETAILS

Name :	EPSILON PHARMACEUTICALS PRIVATE LIMITED
Registered Office :	6-3-348, “MID TOWN” Complex, 6^th Floor, “B” Block, Road No.1, Banjara Hills, Hyderabad – 500034, Andhra Pradesh
Country :	India
Financials (as on) :	31.03.2012
Date of Incorporation :	10.11.1998
Com. Reg. No.:	01-030477
Capital Investment / Paid-up Capital :	Rs.200.000 Millions
CIN No.: [Company Identification No.]	U24230AP1998PTC030477
TAN No.: [Tax Deduction & Collection Account No.]	HYDE00320F
PAN No.: [Permanent Account No.]	AAACE9129K
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacturer of Oncology Formulations.
No. of Employees :	Not Divulged

RATING & COMMENTS

MIRA’s Rating :

B (27)

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

Maximum Credit Limit :	USD 75000
Status :	Moderate
Payment Behaviour :	Unknown
Litigation :	Clear
Comments :	Subject is a company having moderate track. As per Registrar of Companies the date of financial statements filed is shown as March 31, 2013 but the documents related to the same are not available from any source. Management remained non-cooperative in order to provide any information about the subject to us. As per available the company has not commenced its business operations as the management has witnessed a delay in the completion of the manufacturing facility, while the plant was expected to be commissioned in April 2013 but no further updates are available. The rating is also constrained by the exposure to fluctuations in foreign exchange rates as most of the sales for the company will be through exports. However, payment terms are unknown. In view of strong financial support from promoters, the subject can be considered for business dealings 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, 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	ICRA
Rating	Fund Based Limits “BB-”
Rating Explanation	Moderate risk of default regarding timely servicing of financial obligations.
Date	February 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 DENIED

Management is non co-operative, Tel No.91-7702022626.

LOCATIONS

Registered Office :	6-3-348, “MID TOWN” Complex, 6^th Floor, “B” Block, Road No.1, Banjara Hills, Hyderabad – 500034, Andhra Pradesh, India
Tel. No.:	91-40-44609020
Fax No.:	91-40-44609007
E-Mail :	legal@espilonpharma.com
Website :	http://www.epsilonpharma.com
Factory :	SEZ, Green Industrial Park, APIIC, Jadcherla, Mahaboobnagar District, Hyderabad, Andhra Pradesh, India

DIRECTORS

As on: 30.09.2013

Name :

Mr. Chillakuru Sanjay Reddy

Designation :

Director

Address :

8-2-322, Road No.3, Banjara Hills, Hyderabad – 500034, Andhra Pradesh, India

Date of Birth/Age :

29.06.1975

Date of Appointment :

16.01.2002

DIN No.:

01247277

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	Date of cessation	Company/ LLP Status	Defaulting status
1	U65993AP1985PTC005308	CHILLAKURU INVESTMENTS PRIVATE LIMITED	Director	20/10/1997	20/10/1997	-	Active	NO
2	U65993AP1985PTC005309	KAMIREDDY INVESTMENTS PRIVATE LIMITED	Director	20/10/1997	20/10/1997	-	Dormant	NO
3	U65993AP1983PTC003914	GIRIJA INVESTMENTS PRIVATE LIMITED	Director	20/10/1997	20/10/1997	-	Active	NO
4	U85110AP1984PLC004857	DEEPADITYA DEVELOPERS LIMITED	Director	30/08/2001	30/08/2001	-	Active	NO
5	U24230AP1998PTC030477	EPSILON PHARMACEUTICALS PRIVATE LIMITED	Director	16/01/2002	16/01/2002	-	Active	NO
6	U01100AP2005PTC045229	GREEN EARTH AGRI FOODS PRIVATE LIMITED	Director	02/02/2005	02/02/2005	-	Strike off	NO
7	U24230AP1995PLC021887	SH PHARMACEUTICALS LIMITED	Director	10/05/2005	10/05/2005	-	Active	NO
8	U24239AP2005PTC048130	JIVANTA LABORATORIES PRIVATE LIMITED	Director	22/11/2005	22/11/2005	-	Active	NO
9	U23201AP2007PTC053550	SYNGEN BIO FUELS PRIVATE LIMITED	Director	12/04/2007	12/04/2007	-	Active	NO
10	U24232AP2007PTC054924	CYMA LIFE SCIENCES PRIVATE LIMITED	Director	27/07/2007	27/07/2007	06/11/2008	Active	NO
11	U01500AP2010PTC066804	SYNGEN AGRI PRODUCTS PRIVATE LIMITED	Director	27/01/2010	27/01/2010	-	Active	NO

Name :

Mr. Kamireddy Amarendra Reddy

Designation :

Director

Address :

Flat No. G-2, Amrutha Hills, Saphire Building, Panjagutta, Hyderabad – 500082, Andhra Pradesh, India

Date of Birth/Age :

16.06.1966

Date of Appointment :

05.04.2001

DIN No.:

01247268

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	Date of cessation	Company/ LLP Status	Defaulting status
1	U24230AP1998PTC030477	EPSILON PHARMACEUTICALS PRIVATE LIMITED	Director	05/04/2001	05/04/2001	-	Active	NO
2	U65993AP1983PTC003914	GIRIJA INVESTMENTS PRIVATE LIMITED	Director	15/08/2006	15/08/2006	-	Active	NO
3	U23201AP2007PTC053550	SYNGEN BIO FUELS PRIVATE LIMITED	Director	12/04/2007	12/04/2007	30/11/2011	Active	NO
4	U24232AP2007PTC054924	CYMA LIFE SCIENCES PRIVATE LIMITED	Director	27/07/2007	27/07/2007	11/06/2008	Active	NO
5	U65993AP1985PTC005308	CHILLAKURU INVESTMENTS PRIVATE LIMITED	Director	13/09/2007	13/09/2007	-	Active	NO
6	U24239AP2005PTC048130	JIVANTA LABORATORIES PRIVATE LIMITED	Additional director	19/09/2012	18/12/2010	-	Active	NO

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on: 30.09.2013

Names of Shareholders	No. of Shares
C. Sanjay Reddy	4140264
K. Amarendra Reddy	3100
C. G. Reddy	220830
Shah Dhawal Rajesh	1
Shah Dhawani Rajesh	1
Shah Lalita	1
Shah Nisha Rajesh	1
Doshi Bhakti Arvind	1
Doshi Pooja Pankaj	1
Chillakuru Ivenetment (P) Limited, India	4945600
Jivanta Laboratories (P) Limited, India	8631500
Deepaditya Developers Limited, India	2058700
Total	20000000

Equity Share Break up (Percentage of Total Equity)

As on: 30.09.2013

Category	Percentage
Bodies corporate	78.00
Directors or relatives of directors	28.00
Total	100.00

BUSINESS DETAILS

Line of Business :	Manufacturer of Oncology Formulations.
Products :	· Gemcitabine HCl for Injection · Oxaliplatin Injection · Docetaxel Injection Concentrate · Cyclophosphamide for Injection · Oxaliplatin for Injection etc.

GENERAL INFORMATION

No. of Employees :

Not Divulged

Bankers :

· Vijaya Bank (Lead Bank), Narayana Guda Branch, Hyderabad – 500029, Andhra Pradesh, India

· Indian Overseas Bank

Facilities :

(Rs. In Millions)

Secured Loan	As on 31.03.2012	As on 31.03.2011
Long Term Borrowings
Term Loan from Vijaya Bank	104.216	0.000
Term Loan from Indian Overseas Bank	102.081	0.000
Amounts due under hire purchase agreements for purchase of assets	0.710	1.200
Total	207.007	1.200

Banking Relations :

--

Auditors :

Name :

J. B. Reddy and Company

Chartered Accountants

Address :

MIG 11, Block No.1, Flat No.12, Baghlingampally, Hyderabad – 500044, Andhra Pradesh, India

Tel. No.:

91-40-23736593 / 23746229

Fax No.:

91-40-23746259

E-Mail :

jbreddyco@rediffmail.com

reddyav2007@gmail.com

PAN No.:

AANPJ4431B

CAPITAL STRUCTURE

As on: 30.09.2013

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
20000000	Equity Shares	Rs.10/- each	Rs.200.000 Millions

As on: 31.03.2013

Issued, Subscribed & Paid-up Capital:

No. of Shares	Type	Value	Amount
2000000	Equity Shares	Rs.10/- each	Rs.20.000 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	20.000	0.142
(b) Reserves & Surplus	(1.128)	(1.128)
(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)	18.872	(0.986)
(3) Non-Current Liabilities
(a) long-term borrowings	210.207	3.571
(b) Deferred tax liabilities (Net)	0.000	0.000
(c) Other long term liabilities	0.000	0.000
(d) long-term provisions	0.153	0.153
Total Non-current Liabilities (3)	210.360	3.724
(4) Current Liabilities
(a) Short term borrowings	0.000	0.000
(b) Trade payables	0.000	0.000
(c) Other current liabilities	152.891	104.274
(d) Short-term provisions	0.000	0.000
Total Current Liabilities (4)	152.891	104.274
TOTAL	382.123	107.012
II. ASSETS
(1) Non-current assets
(a) Fixed Assets
(i) Tangible assets	35.300	14.795
(ii) Intangible Assets	0.000	0.000
(iii) Capital work-in-progress	234.018	75.871
(iv) Intangible assets under development	0.000	0.000
(b) Non-current Investments	0.000	0.000
(c) Deferred tax assets (net)	0.993	0.993
(d) Long-term Loan and Advances	89.490	13.682
(e) Other Non-current assets	0.000	0.000
Total Non-Current Assets	359.801	105.341
(2) Current assets
(a) Current investments	0.000	0.000
(b) Inventories	7.439	0.000
(c) Trade receivables	0.000	0.000
(d) Cash and cash equivalents	13.440	0.398
(e) Short-term loans and advances	1.443	1.273
(f) Other current assets	0.000	0.000
Total Current Assets	22.322	1.671
TOTAL	382.123	107.012

SOURCES OF FUNDS		31.03.2010
SHAREHOLDERS FUNDS
1] Share Capital		0.142
2] Share Application Money		6.032
3] Reserves & Surplus		0.000
4] (Accumulated Losses)		(1.128)
NETWORTH		5.046
LOAN FUNDS
1] Secured Loans		1.953
2] Unsecured Loans		0.000
TOTAL BORROWING		1.953
DEFERRED TAX LIABILITIES		0.000
TOTAL		6.999
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		5.907
Capital work-in-progress		22.108
INVESTMENT		0.000
DEFERREX TAX ASSETS		0.993
CURRENT ASSETS, LOANS & ADVANCES
	Inventories
	Sundry Debtors
	Cash & Bank Balances
	Other Current Assets
	Loans & Advances
Total Current Assets		1.179
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors
	Other Current Liabilities
	Provisions
Total Current Liabilities		23.188
Net Current Assets		(22.009)
MISCELLANEOUS EXPENSES		0.000
TOTAL		6.999

KEY RATIOS

PARTICULARS	31.03.2012	31.03.2011	31.03.2010
Debt Equity Ratio (Total Debt/Networth)	11.14	(3.78)	0.39
Current Ratio (Current Asset/Current Liability)	0.15	0.02	0.05

FINANCIAL ANALYSIS

[All figures are in Rupees Millions]

DEBT EQUITY RATIO

Particular	31.03.2011	31.03.2012
	(Rs. In Millions)	(Rs. In Millions)
Share Capital	0.142	20.000
Reserves & Surplus	(1.128)	(1.128)
Net worth	(0.986)	18.872
long-term borrowings	3.571	210.207
Short term borrowings	0.000	0.000
Total borrowings	3.571	210.207
Debt/Equity ratio	(3.622)	11.139

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	No
12]	Profitability for last three years	No
13]	Reasons for variation <> 20%	--
14]	Estimation for coming financial year	No
15]	Capital in the business	Yes
16]	Details of sister concerns	No
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

Particulars	As on 31.03.2012	As on 31.03.2011
Long Term Borrowings
Loans from Shareholders	3.200	2.371
Total	3.200	2.371

INDEX OF CHARGES

S.No.	Charge ID	Date of Charge Creation/Modification	Charge amount secured	Charge Holder	Address	Service Request Number (SRN)
1	10324740	12/06/2013 *	582,100,000.00	VIJAYA BANK (LEAD BANK)	NARAYANA GUDA BRANCH, HYDERABAD - 500029, ANDHRA PRADESH, INDIA	B78863933
2	10269972	24/02/2011	1,090,000.00	VIJAYA BANK	NARAYANGUDA BRANCH, NARAYANGUDA, HYDERABAD - 500029, ANDHRA PRADESH, INDIA	B07560584

* Date of charge modification

FIXED ASSETS

· Furniture and Fixtures

· Office Equipments

· Vehicles

· Lease Hold Land

· Computers – Lab

· Plant and Machinery – Pilot Plant

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 records 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.59.03
UK Pound	1	Rs.98.91
Euro	1	Rs.80.34

INFORMATION DETAILS

Information Gathered by :	HTL
Analysis Done by :	SUB
Report Prepared by :	VNK

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	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	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTER
--RBI	YES/NO	NO
--EPF	YES/NO	NO
TOTAL		27

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.