MIRA INFORM REPORT

Report Date :

14.10.2014

IDENTIFICATION DETAILS

Name :	PETRON ENGINEERING CONSTRUCTION LIMITED PETROFAB (A DIVISION PETRON ENGINEERING CONSTRUCTION LIMITED)
Registered Office :	Swastik Chambers, 6^th Floor, Sion Trombay Road, Chembur, Mumbai – 400071, Maharashtra
Country :	India
Financials (as on) :	31.03.2014
Date of Incorporation :	19.07.1976
Com. Reg. No.:	11-019135
Capital Investment / Paid-up Capital :	Rs. 75.384 Millions
CIN No.: [Company Identification No.]	L45202MH1976PLC019135
TAN No.: [Tax Deduction & Collection Account No.]	MUMP00278F
PAN No.: [Permanent Account No.]	AACCP8775G
Legal Form :	A Public Limited Liability Company. The Company’s Shares are Listed on the Stock Exchanges.
Line of Business :	Subject is engaged in the business of engineering, procurement and construction of plants for oil and gas refineries, power, cement, petrochemical, fertiliser and other industries and also provides electrical and instrumentation services and insulation and refractory application/maintenance services to above industries.
No. of Employees :	Not Divulged

RATING & COMMENTS

MIRA’s Rating :

B (30)

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

Maximum Credit Limit :	USD 6450000
Status :	Moderate
Payment Behaviour :	Slow but correct
Litigation :	Exist
Comments :	Subject is an established company having moderate track record. The rating reflects moderate financial risk profile marked by continuous dip in the turnover and thin profit margin of the company. However, trade relations are reported as fair. Business is active. Payments terms are reported to be slow but correct. The company 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 – 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

Verdict Implications : Apex court order may alter coal import dynamics. Traders go slow on talks over coal supply contracts, uncertainty over cancellation of blocks weigh on stocks.

Recent arrest of the Chennai head of the Registrar of Companies, the ministry of corporate affairs arm that ensures that companies file all the information required by the Companies Act is the latest manifestation of a messy fight between a father and his adopted son for the control of Rs 40000 mn business empire. The Central Bureau of Investigation arrested Manumeethi Cholan after he accepted Rs 10 lakhs as bribe from M A M Ramaswamy, a CBI official said.

Central Bureau of Investigation books Electrotherm for cheating Central Bank of Rs 4360 mn.

Infosys maintains revenue guidance. COO Rao says attrition still an area of concern and it would take a few more quarters to bring down levels to 13-15 %.

DHL  to invest Euro 100 mn in India over next 2 years. The firm has chosen India to pilot its e-commerce business model for the Asia-Pacific region.

Blackstone may buy stake in BlueRidge SEZ in line with the fund’s real estate strategy in India.

Kingfisher Airlines Ltd grounded in October 2012 under the weight of heavy debt and accumulated losses, recently approached the Delhi high court for relief in two separate cases. The airline challenged a notice by Punjab & National Bank alleging that It had wilfully defaulted on Rs 7700 mn of loans and sought more time to comply with the requirements under the listing agreements with the Stock Exchanges.

OnMobile likely to sack another 300 employees. The lay-offs follow a spate of senior-level exits over the past two years, starting with of its founder. The overall lay-offs could number around 600 and are driven by the need to cut costs, says a former employee.

EXTERNAL AGENCY RATING

Rating Agency Name	CARE
Rating	Long term bank: “B-”
Rating Explanation	High risk of default.
Date	24.09.2014

Rating Agency Name	CARE
Rating	Short term bank: “A4”
Rating Explanation	Minimal degree of safety. It carry very high credit risk.
Date	24.09.2014

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 DECLINED

MANAGEMENT NON CO-OPERATIVE (Tel. No.: 91-22-40856200/ 40856400)

LOCATIONS

Registered / Corporate Office :	Swastik Chambers, 6^th Floor, Sion Trombay Road, Chembur, Mumbai – 400071, Maharashtra, India
Tel. No.:	91-22-40856200/ 40856400
Fax No.:	91-22-40856250/ 67973509/ 10
E-Mail :	savita@petronengineering.com sales@petronengineering.com dilipkumar@petronengineering.com nvshah@petronengineering.com
Website :	www.petronengineering.com
Area :	5000 Sq. ft. (Approx.)
Location :	Owned
Division :	Petron Mechanical Division Plot No. A – 328, TTC Industrial Area, MIDC, Mahape, Navi Mumbai – 400701, Maharashtra, India Petrofab Division Plot No 222-224, Village – Dabhasa, Vadodara – Jambusar Road, Taluka – Padra, Vadodara – 391440, Gujarat, India Tel. No.: 91-2662-244181 /244281 Fax No.: 91-2662-244181/ 244281 E-Mail: petrofab@petronengineering.com Rockwool Insulation Division Plot No. A – 307, TTC Industrial Area, Mahape, Thane – Belapur Road, Thane, Maharashtra, India E-Mail: rockwoolho@petronengineering.com

DIRECTORS

As on 31.03.2014

Name :	Mr. Ajay Hans
Designation :	Managing Director
Qualification :	Mechanical Engg. Graduate with Masters in Business Finance (MBF) and Masters in Business Administration ( MBA ) with specialization in Marketing
Name :	Mr. Ravi Keswani
Designation :	Non-Executive Director
Qualification :	Chartered Accountant as well as a Law Graduate
Name :	Mr. Sanjay Jain
Designation :	Non-Executive Director
Qualification :	Bachelor of Engineering (Metallurgy) from Regional Engineering College, Trichy, Tamilnadu
Name :	Mr. Sudhir Kumar Jain
Designation :	Non-Executive Director
Qualification :	B. Sc. Engg. (Prod. Engg) and ADPE from Punjab Engg. College, Chandigarh

KEY EXECUTIVES

Name :	R. N. Pandey
Designation :	Chief Financial Officer
Name :	Naresh Shah
Designation :	Head - (Legal) and Company Secretary
SENIOR MANAGEMENT :
Name :	Gautam Sen
Address :	Head - Projects
Name :	G. S. Jain
Address :	Head - Projects
Name :	S. P. Mridha
Address :	Head - Projects
Name :	Manoj Verma
Address :	Head - Procurement and Logistics
Name :	Raghavan K.
Address :	Head – Proposals
Name :	Manish Jantikar
Address :	Head - B. D. and Planning

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 30.06.2014

Category of Shareholders	No. of Shares	Percentage of Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Bodies Corporate	3945393	52.34
Sub Total	3945393	52.34
(2) Foreign
Bodies Corporate	1517810	20.13
Sub Total	1517810	20.13
Total shareholding of Promoter and Promoter Group (A)	5463203	72.47
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	80437	1.07
Financial Institutions / Banks	250	0.00
Sub Total	80687	1.07
(2) Non-Institutions
Bodies Corporate	180161	2.39
Individuals
Individual shareholders holding nominal share capital up to Rs.0.100 Million	1259005	16.70
Individual shareholders holding nominal share capital in excess of Rs.0.100 Million	372800	4.95
Qualified Foreign Investor	182544	2.42
Sub Total	1994510	26.46
Total Public shareholding (B)	2075197	27.53
Total (A)+(B)	7538400	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued
(1) Promoter and Promoter Group	0	0.00
(2) Public	0	0.00
Sub Total	0	0.00
Total (A)+(B)+(C)	7538400	100.00

BUSINESS DETAILS

Line of Business :

Subject is engaged in the business of engineering, procurement and construction of plants for oil and gas refineries, power, cement, petrochemical, fertiliser and other industries and also provides electrical and instrumentation services and insulation and refractory application/maintenance services to above industries.

GENERAL INFORMATION

Customers :

· Adani Infra (India) Limited,Gujarat

· Associated Construction, Dubai

· Bharat Heavy Plate and Vessels Limited, Vizag

· Engineers India Limited, New Delhi

· Gas Authority of India Limited, Pata

· National Fertilisers Limited Guna

· Reliance Energy Limited, Mumbai

· Samsung Engineering Company Limited, Korea

· Madras Cements Limited, Tamilnadu

· Rajashree Cement, Gulbarga

· Indian Oil Corporation Limited, Vadodara

No. of Employees :

Not Divulged

Bankers :

· State Bank of India

· ICICI Bank Limited

· Indian Overseas Bank

· Axis Bank Limited

· IDBI Bank Limited

· ING Vysya Bank Limited

· Yes Bank Limited

Facilities :

SECURED LOANS	31.03.2014 (Rs. In Millions)	31.03.2013 (Rs. In Millions)
LONG TERM BORROWINGS
Term loans INR term loans from banks/financial institutions	275.713	407.881
SHORT TERM BORROWINGS
Cash credit from banks/Working capital demand loan	826.589	888.153
Buyer’s Credit	103.534	305.470
Total	1205.836	1601.504

NOTE

LONG TERM BORROWINGS

a. Term loan from bank amounting to Rs.Nil (Previous year : Rs.74.129 Millions) carried interest @ 12.35% p.a. The loan was repayable in 42 monthly installments along with interest (as per schedule laid down by bank), from the date of loan, viz., 01 January 2011. The loan has been completely repaid on 01 November 2013.The loan was secured by hypothecation of plant and machinery of the Company acquired out of the said loan.

b. Term loans from financial institution amounting to Rs.23.155 Millions (Previous year: Rs.35.413 Millions) was taken during the financial year 2010–11 and carries interest @ 10 % to 13.75% p.a. The loan is repayable in 60 monthly installments including interest (as per the repayment schedules). The loans are secured by primary security of the assets being funded, viz. Plant and Machinery, Motor car and Cranes.

c. Term loans from financial institution amounting to Rs.123.054 Millions (Previous year : Rs.176.590 Millions) has been taken during the financial year 2012–13 and carries interest @ 15.25% p.a. (floating). The loan is repayable in 48 monthly installments including interest (as per the repayment schedules). The loan is secured by Equitable Mortgage of factory freehold land and super structure thereon, located at Pen, Maharashtra and Corporate Guarantee of KSS Petron Private Limited

d. Term loans from bank amounting to Rs.260.000 Millions (Previous year : Rs.261.181 Millions) has been taken during the financial year 2012–13 and carries interest at Bank rate + 2%, which is currently 13% p.a. The loan is repayable in 16 quarterly installments after a moratorium period of 12 months (as per the repayment schedule). The loan is secured by collateral security on Land and Building at Mahape and certain plant and machinery. Also first paripassu charge on the fixed assets of the company excluding certain assets specifically charged to certain lenders, along with other working capital lenders and term lenders.

SHORT TERM BORROWINGS

a) Cash credit/Working capital demand loan and Buyer’s Credit facilities from banks are secured by way of:

I. Pari passu charge on whole of the current assets including stock of raw materials, stock-in-process, semifinished and finished goods, consumables, stores, spares, book debts and all other movables both present and future.

II. Collateral securities as follows:

i. Pari passu charge on the following assets of the Company:

a) Office Blocks at Swastik Chambers, Chembur, Mumbai

b) Factory land and building at Dabhasa,Gujarat

ii. Pari passu charge on entire heavy plant and machinery, fixtures and certain crawler cranes

iii. Corporate guarantee by the holding company – KSS Petron Private Limited

III. The Company has also offered the following security for project specific credit facilities from banks by way of ;

a) Exclusive charge on all current assets specific to the project contracts (including but not limited to rawmaterial, finished goods, work in progress, receivables and the contract receipts from the obligors)

b) Exclusive charge on all monies deposited/credited or caused to be deposited/credited into the project accounts

c) The cash credit / working capital demand loan is repayable on demand and carries interest in the range of 12.80% to 16.75%.

II] Inter corporate deposits

a) Inter corporate deposits carries interest in the range of 11.00% to 16.50% and are repayable on the expiry of the term for which it was taken. Inter corporate deposits include Rs.274.852 Millions (P.Y. Rs.134.988 Millions) taken from related parties.

Banking Relations :	--
Auditors :
Name :	S. R. Batiliboi and Company LLP Chartered Accountants
Address :	16^th Floor, The Ruby, Senapati Bapat Marg (Tulsi Pipe Road), Dadar (West), Mumbai – 400028, Maharashtra, India
Internal Auditors :
Name :	Lodha and Company Chartered Accountants
Address :	C – 1, Upasna, 1 Haily Road, CP, New Delhi – 110001, India
Name :	Lodha and Company Chartered Accountants
Address :	Mumbai, Maharashtra, India
Holding Company :	KSS Petron Private Limited (formerly known as KazStroyService Infrastructure India Private Limited)
Ultimate Holding Company :	KazStroyService Global B.V
Fellow Subsidiaries :	· Kazstroy Engineering India Private Limited · KazStroyService Management Services Pte. Limited · Petron Civil Engineering Private Limited (till March 31st 2013) · JSC OGCC KazStroyService

CAPITAL STRUCTURE

As on 31.03.2014

Authorised Capital :

No. of Shares	Type	Value	Amount
10000000	Equity Shares	Rs.10/- each	Rs.100.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
7538400	Equity Shares	Rs.10/- each	Rs.75.384 Millions

Statement of equity shares outstanding at the beginning and at the end of the reporting period:

PARTICULARS	31.03.2014
	Nos.	(Amount Rs. Millions)
At the beginning of the period	7,538,400	75.384
Outstanding at the end of the period	7,538,400	75.384

Terms/rights attached to equity shares

The Company has only one class of equity shares having par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended 31 March 2014, the amount of per share dividend recognized as distributions to equity shareholders was Rs. Nil (31 March 2013: Rs. Nil).

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets

of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of

equity shares held by the shareholders.

c) Shares held by holding/ultimate holding Company and/or their subsidiaries/associates

Out of equity shares issued by the Company, shares held by its holding Company, ultimate holding Company and

their subsidiaries/associates are as below:

PARTICULARS	31.03.2014 (Amount Rs. in Millions)
KSS Petron Private Limited (Holding company) * 3,945,393 equity shares of Rs.10 each fully paid	39.454
KazStroyService Global B.V. (Ultimate holding company) 1,507,680 equity shares of Rs.10 each fully paid	15.077
Sub subsidiaries of ultimate holding company:
KazStroyService Hungary KFT 10,130 equity shares of Rs.10 each fully paid	0.101

* Petron Investment Private Limited (PIPL), Amritha Sharanya Leasing and Investment Private Limited (ASLIPL), SRA Finance and Investments Private Limited (SRA) have been amalgamated/merged in KSS Petron Private Limited (formerly known as KazStroyService Infrastructure India Private Limited), as per Bombay High Court’s order dated 15^th February, 2013 received by the Company on 26^th March, 2013, effective from 01.04.2013. Hence w.e.f. 01.04.2013 KSS Petron Private Limited is the holding company of Petron Engineering Construction Limited.

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	75.384	75.384	75.384
(b) Reserves & Surplus	1538.224	1501.713	1502.258
(c) Money received against share warrants	0.000	0.000	0.000
(2) Share Application money pending allotment	0.000	0.000	0.000
Total Shareholders’ Funds (1) + (2)	1613.608	1577.097	1577.642
(3) Non-Current Liabilities
(a) long-term borrowings	275.713	407.881	95.887
(b) Deferred tax liabilities (Net)	6.462	22.098	28.213
(c) Other long term liabilities	493.236	131.219	464.457
(d) long-term provisions	11.734	14.509	14.235
Total Non-current Liabilities (3)	787.145	575.707	602.792
(4) Current Liabilities
(a) Short term borrowings	1172.623	1346.339	1256.313
(b) Trade payables	1021.433	1080.798	1208.125
(c) Other current liabilities	1494.522	953.398	1026.179
(d) Short-term provisions	27.141	73.370	69.869
Total Current Liabilities (4)	3715.719	3453.905	3560.486
TOTAL	6116.472	5606.709	5740.920
II. ASSETS
(1) Non-current assets
(a) Fixed Assets
(i) Tangible assets	788.528	936.189	1016.838
(ii) Intangible Assets	19.534	25.491	20.778
(iii) Capital work-in-progress	1.599	12.911	25.424
(iv) Intangible assets under development	0.000	0.000	0.000
(b) Non-current Investments	0.001	0.001	0.001
(c) Deferred tax assets (net)	0.000	0.000	0.000
(d) Long-term Loan and Advances	371.926	85.230	20.580
(e) Other Non-current assets	3.081	0.216	6.632
(d) Trade receivables - retentions	310.166	318.955	253.829
Total Non-Current Assets	1494.835	1378.993	1344.082
(2) Current assets
(a) Current investments	0.000	0.000	0.000
(b) Inventories	11.619	11.051	20.810
(c) Trade receivables	1102.303	1152.228	1678.629
(d) Cash and cash equivalents	113.269	89.417	103.589
(e) Short-term loans and advances	170.507	340.569	355.631
(f) Other current assets	3223.939	2634.451	2238.179
Total Current Assets	4621.637	4227.716	4396.838
TOTAL	6116.472	5606.709	5740.920

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2014	31.03.2013	31.03.2012
	SALES
		Income	3758.717	5242.660	6715.639
		Other Income	35.493	133.821	13.423
		TOTAL (A)	3794.210	5376.481	6729.062
Less	EXPENSES
		Cost of Materials Consumed	1052.161	2069.674	2706.310
		Increases/ (Decrease) in project inventories	2.530	11.993	-12.849
		Employees benefits expense	894.141	1103.142	1097.929
		Other expenses	1417.579	1774.098	2173.520
		TOTAL (B)	3366.411	4958.907	5964.910
	PROFIT/ (LOSS) BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		427.799	417.574	764.152
Less	FINANCIAL EXPENSES (D)		243.657	223.620	127.260
	PROFIT / (LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		184.142	193.954	636.892
Less/ Add	DEPRECIATION/ AMORTISATION (F)		165.874	162.933	159.721
	PROFIT/ (LOSS) BEFORE TAX (E-F) (G)		18.268	31.021	477.171
Less	TAX (H)		(19.667)	30.142	157.156
	PROFIT/ (LOSS) AFTER TAX (G-H) (I)		37.935	0.879	320.015
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		1008.822	1007.943	740.451
Less	APPROPRIATIONS
		Transfer to General Reserve	0.000	0.000	35.000
		Proposed Dividend on Equity Shares	0.000	0.000	15.077
		Tax on Proposed Equity Dividend	0.000	0.000	2.446
	BALANCE CARRIED TO THE B/S		1046.757	1008.822	1007.943
	IMPORTS
		Capital Goods	0.000	1.291	89.619
		Raw Materials	52.706	315.872	247.873
	TOTAL IMPORTS		52.706	317.163	337.492
	Earnings / (Loss) Per Share (Rs.)		5.03	0.12	42.45

QUARTERLY RESULTS

PARTICULARS	30.06.2014
Net Sales	1^stQuarter
Total Expenditure	599.100
PBIDT (Excl OI)	685.300
Other Income	(86.200)
Operating Profit	5.000
Interest	(81.200)
Exceptional Items	69.300
PBDT	0.000
Depreciation	(150.500)
Profit Before Tax	27.0
Tax	(177.500)
Provisions and contingencies	(3.900)
Profit After Tax	0.000
Extraordinary Items	(173.600)
Prior Period Expenses	0.000
Other Adjustments	0.000
Net Profit	0.000
	(173.600)

KEY RATIOS

PARTICULARS		31.03.2014	31.03.2013	31.03.2012
PAT / Total Income	(%)	1.00	0.02	4.76
Net Profit Margin (PBT/Sales)	(%)	0.49	0.59	7.11
Return on Total Assets (PBT/Total Assets}	(%)	0.31	0.59	8.74
Return on Investment (ROI) (PBT/Networth)		0.01	0.02	0.30
Debt Equity Ratio (Total Debt/Networth)		0.90	1.11	0.86
Current Ratio (Current Asset/Current Liability)		1.24	1.22	1.23

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	75.384	75.384	75.384
Reserves & Surplus	1502.258	1501.713	1538.224
Net worth	1577.642	1577.097	1613.608
long-term borrowings	95.887	407.881	275.713
Short term borrowings	1256.313	1346.339	1172.623
Total borrowings	1352.200	1754.220	1448.336
Debt/Equity ratio	0.857	1.112	0.898

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	6715.639	5242.660	3758.717
		(21.934)	(28.305)

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	6715.639	5242.660	3758.717
Profit	320.015	0.879	37.935
	4.77%	0.02%	1.01%

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	Yes
19]	Payments terms	No
20]	Export / Import details (if applicable)	No
21]	Market information	-----
22]	Litigations that the firm / promoter involved in	Yes
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	No
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

LITIGATION DETAILS

HIGH COURT OF BOMBAY
CASE DETAILS
BENCH:- BOMBAY
PRESENTATION DATE:- 10/03/2014
STAMP NO:- ITXAL/647/2014		FILING DATE:- 10/03/2014		REG. NO.: ITXA/765/2014		REG. DATE: 08/04/2014
PETITIONER:-	COMMISSIONER OF INCOME TAX -10-		RESPONDENT:-		PETRON ENGINEERING CONSTRUCTION LIMITED
PETN.ADV:-	ARVIND PINTO (I583)
DISTRICT:-	MUMBAI
BENCH:-	DIVISION
STATUS:-	PRE-ADMISSION		CATEGORY:-		TAX APPEALS
LAST DATE:-	07/10/2014		STAGE:-
LAST CORAM:-	ACCODING TO SITTING LIST ACCODING TO SITTING LIST
ACT:-	INCOME TAX ACT, 1961
UNDER SECTION:-	260A

INDEX OF CHARGES

S.NO.	CHARGE ID	DATE OF CHARGE CREATION/MODIFICATION	CHARGE AMOUNT SECURED	CHARGE HOLDER	ADDRESS	SERVICE REQUEST NUMBER (SRN)
1	10413066	11/03/2013	500,000,000.00	THE KARUR VYSYA BANK LIMITED	CENTRAL LOAN PROCESSING CELL, 65/7, 1ST FLOOR, NEW ROHTAK ROAD, NEW DELHI, DELHI - 110005, INDIA	B71210850
2	10378144	07/09/2012	185,000,000.00	TATA CAPITAL FINANCIAL SERVICES LIMITED	ONE FORBES, DR. V. B. GANDHI MARG, FORT, MUMBAI, MAHARASHTRA - 400001, INDIA	B58752304
3	10360747	15/06/2012	5,484,076.00	SREI EQUIPMENT FINANCE PRIVATE LIMITED	'VISHWAKARMA', 86C, TOPSIA ROAD, KOLKATA, WEST BENGAL - 700046, INDIA	B41673310
4	10352805	04/05/2012	245,000,000.00	ICICI BANK LIMITED	LANDMARKRACE COURCE CIRCLE, ALKAPURI, BARODA, GUJARAT - 390015, INDIA	B38626032
5	10345077	15/03/2012	16,802,020.00	SREI EQUIPMENT FINANCE PRIVATE LIMITED	'VISHWAKARMA', 86C, TOPSIA ROAD, KOLKATA, WEST BENGAL - 700046, INDIA	B36105468
6	10252810	24/09/2010	410,000,000.00	AXIS BANK LIMITED	1ST FLOOR, KARUMUTTU NILAYAM,NO.192, ANNA SALAI, CHENNAI, TAMILNADU - 600002, INDIA	A97609226
7	10241707	19/08/2011 *	1,400,000,000.00	ICICI BANK LIMITED	LANDMARKRACE COURCE CIRCLE, ALKAPURI, BARODA, GUJARAT - 390015, INDIA	B19991504
8	10211635	22/03/2010	32,830,000.00	SREI EQUIPMENT FINANCE PRIVATE LIMITED	'VISHWAKARMA', 86C, TOPSIA ROAD, KOLKATA, WEST BENGAL - 700046, INDIA	A82928375
9	10145364	22/09/2010 *	3,700,000,000.00	STATE BANK OF INDIA	COMMERCIAL BRANCH, 118-121, SWASTIK CHAMBERS, SION TROMBAY ROAD, CHEMBUR, MUMBAI, MAHARASHTRA - 400071, INDIA	A95923892

* Date of charge modification

UNSECURED LOANS

PARTICULAR	31.03.2014 (Rs. In Millions)	31.03.2013 (Rs. In Millions)
SHORT TERM BORROWINGS
Inter-corporate deposits	242.500	152.716
Total	242.500	152.716

CORPORATE INFORMATION

The Company is a public Company domiciled in India and incorporated on 19th July, 1976 under the provisions of the Companies Act, 1956 read with the General Circular 08/2014 dated 04 April 2014 issued by the Ministry of Corporate Affairs. The Company is primarily engaged in the business of engineering, procurement and construction of plants for oil and gas refineries, power, cement, petrochemical, fertiliser and other industries. Its shares are listed on two stock exchanges in India. The Company has mechanical fabrication and manufacturing facilities in Maharashtra and Gujarat regions. The Company also provides electrical and instrumentation services and insulation and refractory application/maintenance services to above industries.

FINANCIAL RESULTS

During the year, the Income from Operations / Sales have declined to Rs.3758.700 Millions as compared to Rs.5242.700 Millions in the previous year (down by 28.31%). The Other Income has also decreased to Rs.35.500 Millions in the current year from Rs.134.000 Millions in the previous year. The Profit before Interest, Depreciation and Tax has improved to Rs.427.800 Millions in the current year as compared to Rs.417.600 Millions in the previous year. However, the Finance Cost has increased to Rs.243.700 Millions in the current year as compared to Rs.223.600 Millions in the previous year. The profit before Depreciation and Tax is Rs.184.100 Millions in the current year as compared to Rs.194.000 Millions in the previous year.

The profit after providing for Depreciation but before Tax is Rs.18.300 Millions in the current year as compared to Rs.31.000 Millions in the previous year. However, after providing tax expenses for the current year and writing back of earlier years, the profit for the year is Rs.37.900 Millions as compared to Rs.0.900 Million in the previous year.

MANAGEMENT DISCUSSION AND ANALYSIS

INDUSTRY TRENDS AND DEVELOPMENTS

For the first time since 1984, the New Government will be free of Coalition Politics. This means a lot for the Industry as the new Government is expected to usher in new policies and incentives to revive the economy in turn leading to impetus across all industries. There is an need for enhanced Infrastructure development. Infrastructure Industry in India is poised for Growth. Petron is optimistic in meeting its share of Engineering Construction business.

Power, Cement and Refineries are considered as major sectors for further business growth for Petron. More investment for the growth of the aforesaid sector is expected in coming days, with the change in the Government. It is anticipated that with the functioning of New Government more infrastructure projects are expected to be cleared which wil open doors of opportunities for the company to grow.

Thus, Petron is geared up to align to participate for such Projects to achieve a sustainable business growth in challenging time.

DIVISION WISE PERFORMANCE

ENGINEERING AND CONSTRUCTION

During the year, the following contract was successfully completed:

Erection and associated works of Boiler and Auxiliaries and TG Auxiliaries of Unit No. 01 and 03 for 3 x 660 MW Tiroda Thermal Power Project of Adani Power Maharashtra Limited at Tiroda, Dist. Gondia, Maharashtra.

The work on the following projects substantially progressed during the year:

a) Mechanical, Electrical and Instrumentation, Fabrication and Erection works for the proposed cement Grinding Unit at Anakapalli, Visakhapatnam of Madras Cements Limited, Chennai, Tamilnadu.

b) Erection, Testing, Commissioning, Performance and Guarantee Tests for Boiler and Auxiliaries Packages for Power Project (2x 660MW) Unit I and Unit II of NCC Limited at Nellore, Andhra Pradesh.

c) Engineering, Procurement, Construction and Commissioning Assistance (EPCC) of Fired Heaters for VGO- HDT unit of Paradip Refinery Project, for Indian Oil Corporation Limited at Paradip, Orissa.

d) Engineering, Procurement, Construction and Commissioning Assistance (EPCC) of AVU Fired Heaters of Paradip Refinery Project for Indian Oil Corporation Limited at Paradip, Orissa.

e) Engineering, Procurement, Construction and Commissioning Assistance (EPCC) of NHT/CCR Fired Heaters for Paradip Refinery Project at Paradip, Orissa for Indian Oil Corporation Limited, Paradip.

f) Erection of Boiler Island, Boiler BOP for SEPCO Electric Power Construction Corporation in 3 x 600MW Power

Plant at Nariyara, Champa, Chattisgarh.

g) Mechanical Erection and Electrical Installation at Chittaurgarh Cement Plant Project, Rajasthan of Lafarge India

Private Limited., Chittaurgarh, Rajasthan.

h) Erection, testing, Commissioning, trial operations and handing over 2 x 600 MW Boilers for Damodar Valley Corporation Power Project as Sub-contractors to Utility Energytech and Engineers Private Limited, Raghunathpur, West Bengal.

i) Composite works for Gas Processing Unit for Petrochemical Complex –II of GAIL (India) Limited at Pata, Uttar

Pradesh.

j) Composite works for Gas Cracker Unit for Petrochemical Complex –II of GAIL (India) Limited at Pata, Uttar Pradesh.

k) Cracker Furnace Package for Petrochemical Complex –II of GAIL (India) Limited, at Pata, Uttar Pradesh

l) Erection, Testing, Commissioning and Performance Guarantee (PG) Tests of Boiler and its Auxiliaries alongwith Critical Piping for Unit 1 and 2 of 1320 MW (Phase-I, 2 x 660MW) Kawai Thermal Power Project, for Adani Infra (India) Limited, at Kawai, Rajasthan.

The Work on the following recently awarded projects have commenced:

a) Supply and erection Contract for Inland transportation, Insurance, Installation, testing, commissioning and conducting Guarantee tests under Electrical equipment supply and erection Package for Vindhyachal Super Thermal Power Project, Stage V ( 1 x 500MW) for NTPC Limited.

b) Supply and erection Contract for Inland transportation, Insurance, Installation, testing and commissioning of “Electrical equipment supply and erection Package” for Kudgi STPP, stage I ( 3x800 MW) for NTPC Limited.

c) Design, Engineering, Manufacturing including Fabrication, Painting, Inspection, Testing, Packing and supply of the Platformer-3 New Convection Bank (F-9601 and E-9602) alongwith the associated ducting and supporting arrangement in two parts, Part-A and Part B (both included) for Essar Oil (UK) Limited, Stanlow, United Kingdom.

d) Heater Package for VGO-HDT Unit for Integrated Refinery Expansion Project (IREP) of Bharat Petroleum Corporation Limited, Kochi Refinery, Kerala.

e) Heater Package of FCCU for Integrated Refinery Expansion Project (IREP) of Bharat Petroleum Corporation Limited, Kochi Refinery, Kerala.

f) Supply of cement, Structural Steel and Reinforcement Steel and Civil and Structural Works for 1x600 MW + 1x660 MW, Visa Raigarh Super Thermal Power Project near Village Deveri and Dumarpali, for Visa Power Limited, District Raigarh, Chhattisgarh.

g) Composite works comprising Civil, Structural, Underground Piping, Buildings, Mechanical Piping, Insulation, Painting, Electrical and Instrumentation works for JBF PTA OSBL Project for JBF Petrochemicals Limited, Mangalore, Karnataka.

h) Composite Mechanical works of Process Units - FCCU for Integrated Refinery Expansion Project (IREP) of Bharat Petroleum Corporation Limited, Kochi Refinery, Kerala.

i) Civil Contract at Nagpur Cement Works for UltraTech Cement Limited, Village Tarsa, Tehsil - Mauda, Dist. Nagpur, Maharashtra.

ELECTRICAL AND INSTRUMENTATION

During the year following contract has been completed:

a) Supply of Electrical Equipment Package (Part – I – Cabling, Earthing and Lightning Protection, Part-II – Electrical Equipment and Part – III – Illumination system) for 2 x 371 MW combined cycle power plant – Stage III at Lanco Infratech Limited, Kondapalli, IDA, Dist. Krishna, Andhra Pradesh.

b) Erection, testing and commissioning of Electrical Erection Package (Part- I – Cabling, Earthing and Lightning Protection, Part – II – Electrical Equipment and Part – III – Illumination System) for 2 x 371 MW Combined Cycle Power Plant – Stage III at Lanco Infratech Limited, Kondapalli IDA, Dist Krishna, Andhra Pradesh.

Presently, the following Orders of the Division are under execution:

a) Contract for Supply of Electrical Equipment, Installation, Testing, Commissioning and conducting Guarantee

Tests for Super Thermal Power Project, Stage IV (2x500) MW of National Thermal Power Corporation Limited,

Vindhyachal, Madhya Pradesh.

b) Contract for Supply of Electrical Equipment, Installation, Testing, Commissioning and conducting Guarantee tests for Super Thermal Power Project, Stage III (2x500 MW) of National Thermal Power Corporation Limited, Rihand, Uttar Pradesh

c) Electrical works for INDMAX(FCC) and PRU of Paradip Refinery Project, for Indian Oil Corporation Limited, Paradip, Orissa

d) Electrical works for off-sites and utilities at Indian Oil Corporation Limited, Paradip Refinery for KazStroyService

Infrastructure India Private Limited, Gurgaon, Haryana.

e) Supply and Erection of Electrical Equipment Package for CCR Projects for Bharat Petroleum Corporation Limited at Mahul, Chembur, Mumbai, Maharashtra.

f) Electrical Installation Work forPurified Terepthalic Acid Plants- PTA- 5 and PTA-6 at Reliance Industries Limited,

Dahej Manufacturing Complex, Gujarat.

g) Design, Engineering, Procurement, Manufacture, Supply, Inspection and Transportation, Insurance, Erection, Testing and commissioning of Electrical Installation work ( Group 2and3 i.e. Boiler and Mill Areas and Common areas respectively) package for Prayagraj Thermal Power Project (3 x 660 MW) at Tehsil – Bara, Allahabad, Uttar

Pradesh.

h) Contract for Supply of Electrical Equipment, Installation, Testing, Commissioning and conducting Gua rantee Tests for Super Thermal Power Project, Stage V (1x500) MW of NTPC Limited., Vindhyachal, Madhya Pradesh.

i) Contract for Supply of Electrical Equipment, Installation, Testing, Commissioning and conducting Guarantee tests for Kudgi Super Thermal Power Project, Stage- I (3x500 MW) of National Thermal Power Corporation Limited, Kudgi, Karnataka.

ROCKWOOL INSULATION AND REFRACTORY:

During the year, the division has successfully executed the following contracts:

a) Application of Refractory and Insulation work for Lafarge Cement Plant – Chittorgarh, Rajasthan.

b) Application of Hot Insulation job for Piping/Equipment for PFY Project, at Reliance Industries Limited, Silvasa Union

Territory

c) Supply and Application of Wrapping and Coating material UG Pipes for Reliance Industries Limited, Dahej, Gujarat.

d) Installation of Refractories for 10000 TPD Cement Plant for ABG Cement Limited, Thumdi, Kutch, Gujarat.

e) Supply and application of Hot Insulation for Turbines of 3 x 800 MW Ultra Mega Power Project of Coastal Gujarat Power Limited (CGPL), Tata Power, Mundra, Gujarat.

f) Refractory and Insulation Jobs at Reliance Industries Limited, Jamnagar and Hazira, Gujarat.

g) Refractory and Insulation Jobs at Essar Oil Limited, Jamnagar, Gujarat.

h) Application of Refractories in Pallet Plant of BMM Ispat Limited, Bellary, Karnataka.

i) Wrapping and Coating of UG Pipelines at Reliance Industries Limited, Silvasa, Union Territory.

Presently, the following orders of the Division are under execution:

a) VGO, AVU, NHT / CCR Heaters and Insulation work for Indian Oil Corporation Limited, Paradeep, Orissa.

b) Design, Engineering, Supply and Application of Refractories for 3 Nos. Ethylene Gas Crackers at GAIL (India) Limited, Pata, Uttar Pradesh.

c) Insulation for Composite Works – GCU and GPU for GAIL (India) Limited, Pata, Uttar Pradesh.

d) Insulation jobs ( ARC) at Reliance Industries Limited, Jamnagar, SEZ and Hazira, Gujarat.

e) Insulation jobs (ARC) at Essar Oil Limited, Jamnagar, Gujarat.

f) Wrapping and Coating for UG Pipelines at IDC for Reliance Industries Limited, Jamnagar, Gujarat.

g) Supply and Application of Insulation and Refractory material along with all ancillaries for BTG and its auxiliaries for 660 MW Unit of Adani Infra Power Project, Kawai Thermal Power Project, Kawai, Rajasthan. (expected to close by June’14 end.)

PETROFAB DIVISION

During the year, this Division has successfully completed the below mentioned projects:

a) Manufacturing and Supply of Air Grid Distributor for Regenerator for Indian Oil Corporation Limited, Vadodara,

Gujarat.

b) Manufacturing, Supply and Painting of Stack with Supporting Structures for Sterling and Wilson Co-Gen Solutions Private Limited, Mumbai.

c) Design, Manufacturing and Supply of 2 T Capacity, 19.5 M Span Overhead Crane for JSC “OGC KazStroy Services”, Kazakhstan.

d) Fabrication, Testing , Painting and Assembly of Piping Spools and Structures for Daniel Measurement Solutions Private Limited, Vadodara, Gujarat.

e) Supply and Fabrication of Convection Modules for Heurtey Petrochem India Private Limited , Mumbai for their Essar Oil Limited, Vadinar project.

Presently, the following orders of the Division are under Execution:

a) Manufacturing and Supply of Air Pre-heater for Thermax Limited, Pune for their Reliance Industries Limited, Dahej project.

b) Design, Manufacturing and Supply of Convection Modules and Ducts for Essar Oil (UK) Limited, Stanlow, United Kingdom.

c) Fabrication of Radiant Sections for Steam Super Heater Unit (For DTA) for Linde Engineering India Private Limited, Vadodara for the J3 Coal Gasification Project of Reliance Industries Limited, Jamnagar, Gujarat.

d) Fabrication of Radiant Sections for Steam Super Heater Unit (For SEZ) for Linde Engineering India Private Limited, Vadodara for J3 Coal Gasification Project of Reliance Industries Limited, at Jamnagar, Gujarat.

e) Fabrication and Modularization of 2 Convection Bundles for Steam Super Heater unit ( For DTA ) for Linde Engineering India Private Limited, Vadodara for the J3 Coal Gasification Project of Reliance Industries Limited, at Jamnagar, Gujarat.

f) Fabrication and Modularization of 3 Convection Bundles for Steam Super Heater Unit ( For SEZ ) for Linde Engineering India Private Limited, Vadodara for the J3 Coal Gasification Project of Reliance Industries Limited, at Jamnagar, Gujarat.

ACHIEVEMENTS

a) The Company has successfully completed 5.02 Million Safe Manhours at Lafarge site at Chittorgarh for Construction of 5000 TPD Cement Plant.

b) The Company has successfully completed 3.73 Million Safe Manhours at Indian Oil Corporation Limited, Paradip Refinery Project.

c) The Company has been certified for the Integrated Management System – combining both QMS ISO 9001:2008, OHSAS 18001:2007 and ISO 14001:2004

d) The Company has received recognition from client Nagarjuna Construction Company Power Projects Limited for the best contractor among all contractors at site.

e) The Company has successfully completed the fabrication and erection works for Line 2 for Madras Cements Limited, at Ariyalur.

f) Mechanical Completion Certificates have been received for Adani Thermal Power Plant at Tiroda and from Indian Oil Corporation Limited (IOCL) Paradip for VGO Project.

CONTINGENT LIABILITIES:

PARTICULARS	31.03.2014 (Rs. In Millions)	31.03.2013 (Rs. In Millions)
a) Claims against the Company not acknowledged as debts, comprises of;
Sales tax matters in appeal (Sales tax matters in appeal mainly comprises of demands made on account of non submission of C& E forms, disallowances on assessments,additional tax levied,late filing of returns, non submission of original documents etc).	41.562	54.936
Excise duty matters in appeal (Excise matters in appeal mainly comprises of demands made on duty paid imported goods & diffrence in scheduled rates).	0.849	0.741
Service tax mattes in appeal (Service tax matters in appeal mainly comprises of demands made on disallowance of input credit, disallowing the abatement scheme adopted by the company and penalty for late payment etc).	61.417	56.498
Income-tax matters (Income-tax matters comprises of demand of tax and interest on short deduction of tax deducted at source).	954.481	954.034
Labour matters and other litigations (Labour matters comprises of demand made for labour welfare cess).	35.092	3.970
Total	1093.401	1070.179
b) The Company is contesting the above demands and does not expect any material liability in respect of above contingent items, the effect of which, if any, will be taken as and when these are settled. c) Bank guarantees and Inland/Foreign letters of credit issued by the banks on behalf of the Company of Rs.3327.930 Millions (31st March 2013: Rs.2994.647 Millions) and Rs.177.902 Millions (Rs.544.251 Millions) respectively. d) In respect of certain contracts where the contractual completion dates have already been expired, the Company is in the \ process of getting extention of contractual completion dates. Company is of the view that no liquidated damages for delay will be levied as delays are mainly on part of customers obligations. The ultimate outcome of the same will be known only after the completion of the contracts.

STATEMENT OF UNAUDITED RESULTS FOR THE QUARTER ENDED 30th JUNE, 2014

(Rs. in Millions)

Particulars	Quarter Ended
	30th June 2014 (Unaudited)
1 Income from Operations (a) Net Sales/Income from Operations (net of service tax, sales tax & excise duty) (b) Other Operating Income	599.100 -
Total Income Operations (Net)	599.100
2 Expenditure (a) Cost of Materials Consumed (b) Changes in Project inventories (c) Sub-contracting expenses (d) Employees Benefits Expense (e) Depreciation and Amortisation Expense (f) (f) Other expenditure	188.400 (13.200) 210.400 195.900 27.000 103.800
Total	712.300
3. Profit/(Loss) from Operations before Other income, Finance cost and Exceptional items 4. Other Income 5. Profit/(loss) from ordinary activities before Finance Cost and Exceptional items 6. Finance Cost 7. Profit/(Loss) from ordinary activities after Finance costs but before Exceptional items 8. Exceptional items 9. Net Profit / (Loss) from ordinary activities before tax 10.Tax Expenses (deferred tax includes Rs. 1.311 Millions for prior period, P.Y. Rs.NIL ) 11. Net Profit/ (Loss) from ordinary activities after tax 12. Extraordinary items (net of taxes Rs. Nil) 13. Net Profit/ (Loss) for the period 14. Paid-up equity share capital (Face Value: Rs.10/- per equity share) 15. Reserve excluding Revaluation Reserves as per balance sheet of previous year 16. Earnings per Share (EPS) (of Rs 10/- each) (not annualised) (a) Basic and diluted EPS before Extraordinary items (b) Basic and diluted EPS after Extraordinary items (A) PARTICULARS OF SHAREHOLDING 1. Public shareholding Number of Shares Percentage of shareholding 2. Promoters & Promoter Group Shareholding (a) Pledge / Encumbered No of Shares '- % of Shares (as a % of the total shareholding of promoter & promoter group) -% of Shares (as a % of the total share capital of the Company) (b) Non encumbered No of Shares '- % of Shares (as a % of the total shareholding of promoter & promoter group) -% of Shares (as a % of the total share capital of the Company)	(113.200) 5.000 (108.200) 69.300 (177.500) - (177.500) (3.900) (173.600) - (173.600) 75.400 -- (23.03) (23.03) 2,075,197 27.53% Nil Nil Nil 5,463,203 100% 72.47%
Particulars	Three months ended 30th June 2014
(B) INVESTOR COMPLAINTS (No.) Pending at the beginning of the Quarter	Nil
Received during the Quarter	Nil
Disposed of During the Quarter	Nil
Remaining unresolved at the end of Quarter	Nil

NOTE

1. The above audited financial results have been reviewed by the Audit Committee and then approved by the Board of Directors at their respective meetings held on the 14th August, 2014

2. The Company is primarily engaged in the business of '‘Engineering, Procurement and Construction'' and operates in a single business segment based on the nature of the products and services, the risks and returns etc. Accordingly, these financial results have been prepared for this single segment.

3. During the quarter, the company has revised the depreciation rate on certain fixed assets as per the useful life specified in the Companies Act, 2013 or reassessed by the Company. Based on the current estimates, carrying amount of Rs. 8.657 Millions in respect of assets whose useful life is already exhausted as on April 1, 2014 (net of deferred tax of Rs. 2.943 Millions thereon), have been adjusted to retained earnings. Had there not been any change in the useful life of assets, depreciation for the quarter would have been higher by Rs. 4.549 Millions.

4. The previous period / year figures have been regrouped/reclassified to make them comparable with the current period / year figures wherever necessary.

5. A Vendor had filed winding-up petition against the Company for non-payment of debt due after having raised demand of Rs.127.700 Millions on the Company to clear its dues.

6. The Division Bench of Hon’ble High Court of Bombay has passed an Order on June 26, 2014 and directed the Company to pay Rs. 75.000 Millions (in 10 equal installments) w.e.f. August, 2014. This has been challenged in Supreme Court by filing Special Leave petition, the hearing of which is yet to take place.

7. However, considering the merits of the case in regular hearing and based on legal opinion obtained by the management, no further liability will accrue on the Company in the books of accounts as on June 30, 2014.

8. The Company is facing liquidity issue as some of the on going contracts have very high back-ended billing and payment terms, release of which is linked to contracts achieving certain milestones and getting approvals of respective clients.

9. To mitigate the above factor, the Company has received support from the Parent Company for Rs. 4,930 lacs as at June 30, 2014. It is also working to achieve contracted milestones in ongoing projects thereby releasing crucial working capital which the company's management expects to achieve by December 2014. The Ultimate Parent Company has given an unconditional support letter upto June 30, 2015 to bridge the gap of working capital, if any.

10. The figures for the quarter ended March 31,2014 are the balancing figures between audited figures of the full financial year ended March 31,2014 and the unaudited published year to date figures upto December 31, 2013 being the end of the third quarter of financial year (which were subject to limited review by the statutory auditors.

FIXED ASSETS

Tangible Assets

· Land Freehold

· Land Leasehold

· Buildings

· Plant and Equipment

· Furniture and Fixtures

· Vehicles

Intangible Assets

· Computer Software

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.61.25
UK Pound	1	Rs.98.68
Euro	1	Rs.77.60

INFORMATION DETAILS

Information Gathered by :	DIP
Analysis Done by :	DIV
Report Prepared by :	MRI

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	4
PAID-UP CAPITAL	1~10	3
OPERATING SCALE	1~10	4
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	4
--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	YES
--OTHER ADVERSE INFORMATION	YES/NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTER
--RBI	YES/NO	NO
--EPF	YES/NO	NO
TOTAL		30

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.