MIRA INFORM REPORT

Report No. :	317871
Report Date :	21.04.2015

IDENTIFICATION DETAILS

Name :		VNR ENTERPRISES
Registered Office :		C603, 6th Floor, Diamond World Centre, Mini Bazar, Near Mangadh Chowk, Varachha Road, Surat – 395006, Gujarat
Tel. No.:	91-261-2563900
Country :		India
Financials (as on) :		31.03.2014
Year of Establishment :		2005
Capital Investment :		Rs. 55.299 Million
PAN No.: [Permanent Account No.]		AAFFV1031P
Legal Form :		Partnership Concern with an Unlimited Liability of the Partners
Line of Business :		Manufacturer, Trader, Exporter and Importer of Diamonds.
No. of Employees :		400 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

Ba (47)

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

Status :	Satisfactory
Payment Behaviour :	Slow but correct
Litigation :	Clear
Comments :	Subject is an established partnership concern having satisfactory track record. Profitability of the concern seems to be low during 2014. However, general financial position of the concern seems to be decent. Trade relations are fair. Business is active. Payment terms are reported to be slow but correct. The concern 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 – December 31, 2014

Country Name	Previous Rating (30.09.2014)	Current Rating (31.12.2014)
India	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

EXTERNAL AGENCY RATING

NOT AVAILABLE

RBI DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available RBI Defaulters’ list.

EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of 31-03-2014.

INFORMATION PARTED BY

Name :	Mr. Jitesh Savaliya
Designation :	Accountant
Contact No.:	91-8238568426
Date :	16.04.2015

LOCATIONS

Registered/ Head Office/ Factory :	C603, 6th Floor, Diamond World Centre, Mini Bazar, Near Mangadh Chowk, Varachha Road, Surat – 395006, Gujarat, India
Tel. No.:	91-261-2563900
Mobile No.:	91-8238568426 (Mr. Jitesh Savaliya)
Fax No.:	Not Available
E-Mail :	info@vnrenterprise.net krunal@vnrenterprise.net
Website :	http://www.vnrenterprise.net
Location :	Owned
Branch Office :	DW-3160, Bharat Diamond Bourse, BKC, Bandra (East), Mumbai, Maharashtra, India
Tel. No.:	91-22-32206543

PARTNERS

Name :	Mr. Rameshbhai Asodaria
Designation :	Partner
Name :	Mr. Pravinbhai Alagiya
Designation :	Partner
Name :	Mr. Vinubhai Kakadiya
Designation :	Partner
Name :	Mr. Kalpeshbhai Kakadiya
Designation :	Partner
Name :	Mr. Mahendrabhai Kakadiya
Designation :	Partner

KEY EXECUTIVES

Name :	Mr. Jitesh Savaliya
Designation :	Accountant

BUSINESS DETAILS

Line of Business :	Manufacturer, Trader, Exporter and Importer of Diamonds.
Brand Names :	--
Agencies Held :	--
Exports :
Products :	Diamonds
Countries :	· Hong Kong · USA · Israel · Dubai
Imports :
Products :	Raw Material
Countries :	· Belgium · Dubai
Terms :
Selling :	Cash and Credit
Purchasing :	Cash and Credit

GENERAL INFORMATION

Suppliers :

Reference:	Not Divulged
Name of the Person (Designation):	Not Divulged
Contact Number:	Not Divulged
Since how long known:	Not Divulged
Maximum limit dealt:	Not Divulged
Experience:	Not Divulged
Remark	Not Divulged

· Sami Jain BVBA, Belgium

· Antwerp Diamonds

· MSD HK Limited

· Dianco BVBA

· Gem Blue BVBA

· Gyan Gems Private Limited

· Star Solitaire CRE

· Samir Gems

· Shah Imesport BVBA

Customers :

Reference:	Ding Diamond Private Limited, Surat
Name of the Person (Designation):	Mr. Chiragbhai (Manager)
Contact Number:	91-9930138527
Since how long known:	5 Years
Maximum limit dealt:	Rs. 30.000 Million
Experience:	Product Quality = Excellent Delivery Behaviour = Excellent Overall = Excellent
Remark	Mr. Chirag informed that they fully satisfied with their product quality and delivery behavior.

· Excellent Diamonds, Hong Kong

· Kailash Export

· Max Rich Creation

· Nirgem HK Limited

· SIM Gems Limited Exports

· Abheek Exports

· Dihora Brothers

· Guru Krupa Exports

· Kaycee Diamonds

· P Manish Exports

· Rag Corporation

No. of Employees :

400 (Approximately)

Bankers :

Bank Name:	Corporation Bank
Branch:	Udhana Darwaja, Surat, Gujarat, India
Person Name (with Designation):	Not Divulged
Contact Number:	Not Divulged
Name of Account Holder:	Not Divulged
Account Number:	Not Divulged
Account Since (Date/ Year of A/c Opening):	Not Divulged
Average Balance Maintained (Optional):	Not Divulged
Credit Facilities Enjoyed (CC/OD/Term Loan):	CC = Rs. 80.000 Million
Account Operation:	Not Divulged
Remarks: Not Divulged

· Axis Bank Limited

Kutargam Branch, Surat, Gujarat, India

Facilities :

CC = Rs. 80.000 Million [From Corporation Bank]

SECURED LOANS	31.03.2014 Rs. In Million	31.03.2013 Rs. In Million
Corporation Bank Discount Loan	29.485	41.120
Corporation Bank PCFC-06	2.458	0.000
Corporation Bank PCFC-07	18.574	0.000
Corporation Bank PCFC-10	0.000	10.724
Corporation Bank PCFC-11	0.0000	4.527
Corporation Bank PCFC-12	14.073	0.000
Corporation Bank PCFC-13	0.000	4.071
Corporation Bank PCFC-17	0.000	4.303
Corporation Bank PCFC-19	0.000	15.378
Corporation Bank PCFC-84	4.515	0.000
Total	69.105	80.123

Auditors :
Name :	Ankit Shah and Company Chartered Accountants
Address :	301-302, Aadinath Building, Mahidharpura, Jadakhadi, Surat – 395003, Gujarat, India
PAN No.:	ALTPS2771C
Associates/Subsidiaries :	Not Available

CAPITAL STRUCTURE

AS ON 31.03.2014

PARTICULARS	RS. IN MILLION	RS. IN MILLION
MR. KALPESHBHAI KOKADIYA
Opening Balance		6.292
Partner interest	0.731
Partner salary	0.300
Net profit transfer from Profit and Loss A/C	0.947	1.978
		8.270
Less : Advance tax 2012-13	0.165
Advance tax 2013-14	0.150
Income Tax	0.074	0.389
Closing Balance		7.881
MR. MAHENDRABHAI KOKADIYA
Opening Balance		5.812
Partner interest	0.673
Partner salary	0.300
Net profit transfer from Profit and Loss A/C	0.946	1.919
		7.731
Less : Advance tax 2012-13	0.165
Advance tax 2013-14	0.150
Income Tax	0.077	0.392
Closing Balance		7.339
MR. PRAVINBHAI ALAGIYA
Opening Balance		7.834
Partner interest	0.878
Partner salary	0.300
Net profit transfer from Profit and Loss A/C	2.841	4.019
		11.853
Less : Advance tax 2012-13	0.495
Advance tax 2013-14	0.150
Income Tax	0.007	0.652
Closing Balance		11.201
MR. RAMESHBHAI ASODARIA
Opening Balance		12.103
Partner interest	1.387
Partner salary	0.300
Net profit transfer from Profit and Loss A/C	2.841	4.528
		16.631
Less : Advance tax 2012-13	0.495
Advance tax 2013-14	0.150
Income Tax	0.102	0.747
Closing Balance		15.884
MR. VINUBHAI KOKADIYA
Opening Balance		10.815
Partner interest	1.272
Partner salary	0.300
Net profit transfer from Profit and Loss A/C	1.033	2.605
		13.420
Less : Advance tax 2012-13	0.180
Advance tax 2013-14	0.150
Income Tax	0.017
Withdrawal	0.079	0.426
Closing Balance		12.994
Summery :
Mr. Kalpeshbhai Kokadiya		7.881
Mr. Mahendrabhai Kokadiya		7.339
Mr. Pravinbhai Alagiya		11.201
Mr. Rameshbhai Asodaria		15.884
Mr. Vinubhai Kokadiya		12.994
TOTAL		55.299

FINANCIAL DATA

[all figures are in Rupees Million]

Expected Sales (2014-2015): Rs.2000.000 Million [Due to Business Expansion]

The above information has been parted by Mr. Jitesh Savaliya (Accountant)

Note : Sole Proprietary and Partnership concerns are exempted from filing their financials with the Government Authorities or Registry.

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2014	31.03.2013
SHAREHOLDERS FUNDS
1] Partners Capital		55.299	42.858
2] Share Application Money		0.000	0.000
3] Profit and Loss Account		0.000	0.000
4] (Accumulated Losses)		0.000	0.000
NETWORTH		55.299	42.858
LOAN FUNDS
1] Secured Loans		69.105	80.123
2] Unsecured Loans		3.239	4.892
TOTAL BORROWING		72.344	85.015
DEFERRED TAX LIABILITIES		0.000	0.000
TOTAL		127.643	127.873
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		5.029	4.161
Capital work-in-progress		0.000	0.000
INVESTMENT		5.542	5.072
DEFERRED TAX ASSETS		0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	506.096	298.894
	Sundry Debtors	146.203	116.368
	Cash & Bank Balances	7.692	3.521
	Other Current Assets	0.000	0.000
	Loans & Advances	6.830	6.596
Total Current Assets		666.821	425.379
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	538.882	305.579
	Other Current Liabilities	0.000	0.000
	Provisions	10.867	1.160
Total Current Liabilities		549.749	306.739
Net Current Assets		117.072	118.640
MISCELLANEOUS EXPENSES		0.000	0.000
TOTAL		127.643	127.873

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2014	31.03.2013
	SALES
		Income	1,055.089	547.068
		Other Income	3.675	2.891
		TOTAL	1,058.764	549.959
Less	EXPENSES
		Cost of Materials Consumed	942.539	506.296
		Purchase of Stock-in-trade	60.288	20.797
		Other Expenses	38.160	13.662
		TOTAL	1,040.987	540.755
	PROFIT/(LOSS) BEFORE INTEREST, DEPRECIATION AND AMORTISATION		17.777	9.204
Less	FINANCIAL EXPENSES		8.137	3.550
	PROFIT/(LOSS) BEFORE DEPRECIATION AND AMORTISATION		9.640	5.654
Less	DEPRECIATION/ AMORTISATION		1.031	0.891
	PROFIT/(LOSS) FOR THE YEAR		8.609	4.763

KEY RATIOS

PARTICULARS		31.03.2014	31.03.2013
Net Profit Margin (PAT/Sales)	(%)	0.82	0.87
Operating Profit Margin (PBDIT/Sales)	(%)	1.68	1.68
Return on Total Assets (PBT/Total Assets}	(%)	1.28	1.11
Return on Investment (ROI) (PBT/Networth)		0.16	0.11
Debt Equity Ratio (Total Debt /Networth)		1.31	1.98
Current Ratio (Current Asset/Current Liability)		1.21	1.39

FINANCIAL ANALYSIS

[all figures are in Rupees Million]

DEBT EQUITY RATIO

Particulars	31.03.2013	31.03.2014
	Rs. In Million	Rs. In Million
Partners Capital	42.858	55.299
Profit and Loss Account	0.000	0.000
Net worth	42.858	55.299
Secured Loans	80.123	69.105
Unsecured Loans	4.892	3.239
Total borrowings	85.015	72.344
Debt/Equity ratio	1.984	1.308

YEAR-ON-YEAR GROWTH

Year on Year Growth	31.03.2013	31.03.2014
	Rs. In Million	Rs. In Million
Sales	547.068	1,055.089
		92.862

NET PROFIT MARGIN

Net Profit Margin	31.03.2013	31.03.2014
	Rs. In Million	Rs. In Million
Sales	547.068	1,055.089
Profit	4.763	8.609
	0.87%	0.82%

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	No
8]	No. of employees	Yes
9]	Name of person contacted	Yes
10]	Designation of contact person	Yes
11]	Turnover of firm for last two years	Yes
12]	Profitability for last two years	Yes
13]	Reasons for variation <> 20%	Yes
14]	Estimation for coming financial year	Yes
15]	Capital in the business	Yes
16]	Details of sister concerns	No
17]	Major suppliers	Yes
18]	Major customers	Yes
19]	Payments terms	Yes
20]	Export / Import details (if applicable)	Yes
21]	Market information	--
22]	Litigations that the firm / promoter involved in	--
23]	Banking Details	Yes
24]	Banking facility details	Yes
25]	Conduct of the banking account	--
26]	Buyer visit details	--
27]	Financials, if provided	Yes
28]	Incorporation details, if applicable	No
29]	Last accounts filed at ROC	Yes
30]	Major Shareholders, if available	No
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	No

UNSECURED LOANS:

Particulars	31.03.2014 Rs. In Million	31.03.2013 Rs. In Million
Arvindbhai Nagjibhai Kathiriya	0.457	0.413
Aashish Ashokbhai Sorthiya	0.385	0.347
Ashokbhai Vaghjibhai Sorthiya	0.069	0.062
Jayantibhai Kanjibhai	0.085	0.076
Kanjibhai Dhabjibahi Coddoria	0.690	0.622
Pareshbhai Bhupatbhai Panchani	0.000	2.502
Rameshbhai M. Asodariya HUF	0.136	0.123
Rohit Ashokbhai Sothiya	0.385	0.399
Vijay D. Kanani	1.032	0.348
Total	3.239	4.892

DIAMOND INDUSTRY – INDIA

- From time immemorial, India is well known in the world as the birthplace for diamonds.  It is difficult to trace the origin of diamonds but history says that in the remote past, diamonds were mined only in India. Diamond production in India can be traced back to almost 8^th Century B.C.  India, in fact, remained undisputed leader till 18^th Century when Brazilian fields were discovered in 1725 followed by emergence of S. Africa, Russia and Australia.

- The achievement of the Indian diamond industry was possible only due to combination of the manufacturing skills of the Indian workforce and the untiring and unflagging efforts of the Indian diamantaires, supported by progressive Government policies.

- The area of study of family owned diamond businesses derives its importance from the huge conglomerate of family run organizations which operate in the diamond industry since many generations.

- Some of the basic traits of family run business enterprises include spirit of entrepreneurship, mutual trust lowers transaction costs, small, nimble and quick to react, information as a source of advantage and philanthropy.

- Family owned diamond businesses need to improve on many fronts including higher standard of corporate governance, long-term performance – focused strategies, modern management and technology.

- Utmost caution is to be exercised while dealing with some medium and large diamond traders which are usually engaged in fictitious import – export, inter-company transactions, financially assisted by banks. In the process, several public sector banks lost several hundred million rupees. They mostly diverted borrowed money for diamond business into real estate and capital markets.

- Excerpts from Times of India dated 30^th October 2010 is as under –

- Gem & Jewellery Export Promotion Council in its statistical data has shown the export of polished diamonds to have increase by 28 % in February 2013. Compared to $ 1.4 bn worth of polished diamond export in February, 2012, India exported $ 1.84 billion worth of polished diamonds in February 2013. A senior executive of GJEPC said, “Export of cut and polished diamonds started falling month-wise after the imposition of 2 % of import duty on the polished diamonds. But February, 2013 has given a new ray of hope to the industry as the export of polished diamonds has actually increased by 28 %. It means the industry  is on the track of recovery and round tripping of diamonds has stopped completely.” Demand has started coming from the US, the UK, Japan and China. India’s polished diamond export is expected to cross $ 21 bn in 2013-14.

- The banking sector has started exercising restraint while following prudent risk management norms when lending money to gems and jewellery sector. This follows the implementation of Basel III accord – a global voluntary regulatory standard on bank capital adequacy, stress testing and market liquidity.

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. 62.92
UK Pound	1	Rs. 93.57
Euro	1	Rs. 67.34

INFORMATION DETAILS

Information Gathered by :	PRT
Analysis Done by :	RAS
Report Prepared by :	BVA

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	5
--PROFITABILITY	1~10	6
--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	YES
--AFFILIATION	YES/NO	NO
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTER
--RBI	YES/NO	NO
--EPF	YES/NO	NO
TOTAL		47

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.