MIRA INFORM REPORT

Report No. :	324860
Report Date :	18.06.2015

IDENTIFICATION DETAILS

Name :	MSP STEEL AND POWER LIMITED
Registered Office :	1, Crooked Lane, Kolkata – 700069, West Bengal
Tel. No.:	91-33-22483795 / 4138
Country :	India
Financials (as on) :	31.03.2015
Date of Incorporation :	18.11.1968
Com. Reg. No.:	21-027399
Capital Investment / Paid-up Capital :	Rs. 1088.940 Million
CIN No.: [Company Identification No.]	L27109WB1968PLC027399
IEC No.:	Not Available
TAN No.: [Tax Deduction & Collection Account No.]	CALM04906G
PAN No.: [Permanent Account No.]	AACCA2756N
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 manufacture and sale of Iron and Steel Products and Generation and Sale of Power.
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 17000000
Status :	Moderate
Payment Behaviour :	Slow but correct
Litigation :	Clear
Comments :	Subject is an established company having moderate track record. For the financial year ended 2015, company has reported moderate operational performance and it has incurred loss from its operational activities. The rating is constrained on account of company’s moderate financial risk profile marked by moderately high leverage liquidity position and recent corporate debt restructuring of the company. However, trade relations are fair. Business is active. Payments are reported to be slow but correct. The company can be considered for business dealing 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, 2015

Country Name	Previous Rating (31.12.2014)	Current Rating (31.03.2015)
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

Rating Agency Name	CARE
Rating	Long term bank facilities: “BBB” Suspended
Rating Explanation	Moderate degree of safety and moderate credit risk.
Date	06.10.2014

Rating Agency Name	CARE
Rating	Short term bank facilities: “A3+” Suspended
Rating Explanation	Moderate degree of safety and high credit risk.
Date	06.10.2014

Reason for suspension: Absence of requisite information.

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 31-03-2013.

INFORMATION DENIED BY

Name :	Mr. Pramod Singh
Designation :	Deputy Manager
Contact No.:	91-33-22483795/33-40057777
Date :	17.06.2015

LOCATIONS

Registered Office :	1, Crooked Lane, Kolkata – 700 069, West Bengal, India
Tel. No.:	91-33-22483795 / 4138
Fax No.:	91-33 22481738
E-Mail :	invertor.contact@mspsteel.com
Website :	http://www.mspsteel.com
Corporate Office :	16/ S, Block 'A' New Alipore, Kolkata - 700 053, West Bengal, India
Tel. No.:	91-33-24570038/ 24573940/ 40057777
Fax No.:	91-33-24582239/ 40057788
E-Mail :	contactus@mspsteel.com
Factory :	P.O. and Village Manuapali, Jamgaon, District – Raigarh, Chattishgarh, India
Tel. No.:	91-7762-2644-49/ 51/ 52/ 53
Fax No.:	91-7762-264450
E-Mail :	sambeet.das@mspsteel.com

DIRECTORS

As on: 31.03.2014

Name :	Mr. Puranmal Agrawal
Designation :	Chairman and Whole-time Director
Qualification:	B.com
Date of Birth/Age:	65 Years
Date of Appointment:	08.07.2012
Name :	Mr. Suresh Kumar Agrawal
Designation :	Managing Director
Qualification:	B.E. Mechanical
Date of Birth/Age:	59 Years
Date of Appointment:	08.07.2012
Name :	Mr. Manish Agrawal
Designation :	Non Executive Director
Name :	Mr. Saket Agrawal
Designation :	Non Executive Director
Qualification:	Commerce Graduate and MBA
Name :	Mr. Arvind Kumar Saraf
Designation :	Independent Director
Name :	Mr. Navneet Jagatramka
Designation :	Independent Director
Name :	Mr. Amit Mehta
Designation :	Independent Director
Name :	Mr. Ashok Kumar Soin
Designation :	Independent Director

KEY EXECUTIVES

Name :	Ms. Ruchi Garg
Designation :	Company Secretary
Name :	Mr. Amit Agarwal
Designation :	Finance and Senior Accounts Manager
Name :	Mr. Pramod Singh
Designation :	Deputy Manager

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on: 31.03.2015

Category of Shareholders	No. of Shares	Percentage of Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	2303240	2.61
Bodies Corporate	61040260	69.29
Sub Total	63343500	71.90
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	63343500	71.90
(B) Public Shareholding
(1) Institutions
Financial Institutions / Banks	254990	0.29
Sub Total	254990	0.29
(2) Non-Institutions
Bodies Corporate	17047806	19.35
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 Million	4858153	5.51
Individual shareholders holding nominal share capital in excess of Rs. 0.100 Million	2371539	2.69
Any Others (Specify)	224012	0.25
Non Resident Indians	212095	0.24
Clearing Members	11917	0.01
Sub Total	24501510	27.81
Total Public shareholding (B)	24756500	28.10
Total (A)+(B)	88100000	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	0	0.00
(1) Promoter and Promoter Group	0	0.00
(2) Public	0	0.00
Sub Total	0	0.00
Total (A)+(B)+(C)	88100000	0.00

BUSINESS DETAILS

Line of Business :	Subject is engaged in the manufacture and sale of Iron and Steel Products and Generation and Sale of Power.
Products :	Not Available
Brand Names :	Not Available
Agencies Held :	Not Available
Exports :	Not Divulged
Imports :	Not Divulged
Terms :
Selling :	Not Divulged
Purchasing :	Not Divulged

PRODUCTION STATUS NOT AVAILABLE

GENERAL INFORMATION

Suppliers :

Reference :	Not Divulged
Name of the Person :	Not Divulged
Contact No.:	Not Divulged
Since How Long Known :	Not Divulged
Experience :	Not Divulged
Maximum Limit Dealt :	Not Divulged

Customers :

Reference :	Not Divulged
Name of the Person :	Not Divulged
Contact No.:	Not Divulged
Since How Long Known :	Not Divulged
Experience :	Not Divulged
Maximum Limit Dealt :	Not Divulged

No. of Employees :

Not Divulged

Bankers :

• State Bank of India
• ING Vyasa Bank
• Syndicate Bank
• UCO Bank
• Indian Overseas Bank
• State Bank of Mysore
• Allahabad bank
• State Bank of Bikaner & Jaipur
• Corporation Bank
• DBS Bank Limited
• ICICI Bank Limited
• Union bank of India
• Dena Bank
• Oriental Bank of Commerce

Facilities :

(Rs. In Million)

Secured Loan	As on 31.03.2015	As on 31.03.2014
Long term borrowings
Rupee loan from banks
- Indian rupee loan		4390.520
- Foreign currency loan		373.626
Finance Lease Obligation
- From Banks		2.717
- From Body Corporate		1.028
Short term borrowings
Cash Credit Facility		3788.703
Cash Credit Facility from non consortium banks		50.000
Foreign Currency Loans from Banks		0.000
Total	NA	8606.594

Auditors :
Name :	Sunil Kumar Agrawal and Associates Chartered Accountants
Jointly Controlled Entity (As on 31.03.2014) :	· Madanpur South Coal Company Limited
Subsidiary Company(As on 31.03.2014) :	MSP Group International Singapore (PTE) Limited MSP Cement Limited AA ESS Tradelinks Private Limited
Enterprises over which Key Management Personnel and / or their Relatives have significant influence (As on 31.03.2014) :	Adhunik Gases Limited Ashirwad Steels and Industries Limited * B.S. Confin Private Limited Chaman Metallics Limited Danta Vyapaar Kendra Limited * Dexo Trading Private Limited Emerald Tradelink Private Limited High Time Holding Private Limited Howrah Gases Limited Ilex Private Limited K.C. Texofine Private Limited Larigo Investment Private Limited MSP Infotech Private Limited MSP Metallics Limited MSP Mines and Minerals Limited MSP Power Limited MSP Properties (India) Limited MSP Sponge Iron Limited MSP Energy Limited MSP Ferro & Power Limited Prateek Mines & Minerals Private Limited Raj Securities Limited Rajnath Vyapaar Private Limited Shree Khatupati Mercantiles Private Limited Sikhar Commotrade Private Limited

CAPITAL STRUCTURE

As on: 31.03.2015

Authorised Capital : Not Available

Issued, Subscribed & Paid-up Capital : 1088.940 Million

As on: 31.03.2014

Authorised Capital :

No. of Shares	Type	Value	Amount
96,000,000	Equity Shares	Rs.10/- each	Rs. 960.000 Million
21,000,000	6% Non Cumulative Preference Shares	Rs.10/- each	Rs.210.000 Million
	Total		Rs. 1170.000 Million

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
88,100,000	Equity Shares	Rs.10/- each	Rs.881.000 Million
20,794,000	6% Non Cumulative Preference Shares	Rs.10/- each	Rs.207.940 Million
	Total		Rs.1088.940 Million

Reconciliation of the shares outstanding at the beginning and at the end of the year

Equity shares	No.	Rs. In million
At the beginning of the year	88,100,000	881.000
Outstanding at the end of the year	88,100,000	881.000

Preference shares	No.	Rs. In million
At the beginning of the year	8,794,000	87.940
Issued during the year	12,000,000	12.000
Outstanding at the end of the year	20,794,000	20.794

Terms/ rights attached to equity shares

The company has only one class of equity shares having a nominal value of ` 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.

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.

Terms/rights attached to preference shares

The company has only one class of preference shares (i.e. 6% non-cumulative redeemable preference shares) having a nominal value of Rs.10/- per share. The preference shareholders shall have the right to vote on any resolution of the Company directly affecting their rights. The company declares and pays preferential dividend in Indian rupees.

The preference share(s) of the Company are non-cumulative in nature and therefore in case the Company does not declare dividend in any particular year, dividend right gets lapsed and is not eligible for carry forward in future years.

During the year, the Company had issued 12,000,000 numbers of preference shares of Rs. 10/- each in the same class with a premium of Rs. 90/- per share. Preference shares are redeemable within 20 years from the date of allotment at a price to be decided by the Board of Directors at the time of redemption.

In the event of liquidation of the Company, the holders of preference shares will be entitled to receive assets of the company, before its distribution to equity shareholders. The distribution will be in proportion to the number of preference shares held by the preference shareholders.

Details of shareholders holding more than 5% shares in the company

Equity shares of Rs. 10/- each fully paid	No.	% holding in the class
Adhunik Gases Limited	55,54,000	6.30%
MSP Infotech Private Limited	7,229,760	8.21%
MSP Sponge Iron Limited	24,736,500	28.08%

Details of shareholders holding more than 5% shares in the company

Preference shares of Rs. 10/- each fully paid	No.	% holding in the class
B.S. Confin Private Limited	2,450,000	11.78%
Dexo Trading Private Limited	3,920,000	18.85%
Hightime Holdings Private Limited	2,450,000	11.78%
Ilex Private Limited	1,800,000	8.66%
Jaik Leasing and Commercial Investment Private Limited	1,540,000	7.41%
M.A. Hire Purchase Private Limited	1,105,000	5.31%
Sikhar Commotrade Private Limited	3,635,000	17.48%

FINANCIAL DATA

[all figures are in Rupees Million]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.03.2015	31.03.2014	31.03.2013
I.              EQUITY AND LIABILITIES
(1)Shareholders' Funds
(a) Share Capital	1088.940	1088.940	968.940
(b) Reserves & Surplus	4909.839	5937.249	4647.214
(c) Money received against share warrants	0.000	0.000	0.000
(2) Share Application money pending allotment	0.000	0.000	1290.000
Total Shareholders’ Funds (1) + (2)	5998.779	7026.189	6906.154
(3) Non-Current Liabilities
(a) long-term borrowings	8952.105	5722.127	5024.423
(b) Deferred tax liabilities (Net)	101.002	586.219	481.497
(c) Other long term liabilities	21.232	11.836	16.478
(d) long-term provisions	18.893	25.609	19.050
Total Non-current Liabilities (3)	9093.232	6345.791	5541.448
(4) Current Liabilities
(a) Short term borrowings	2331.464	3868.905	3832.497
(b) Trade payables	1149.955	1552.126	1492.133
(c) Other current liabilities	609.223	1452.446	1592.529
(d) Short-term provisions	0.000	58.893	133.193
Total Current Liabilities (4)	4090.642	6932.370	7050.352
TOTAL	19182.653	20304.350	19497.954
II.          ASSETS
(1) Non-current assets
(a) Fixed Assets
(i) Tangible assets	11367.599	9992.227	8857.963
(ii) Intangible Assets	0.000	0.000	0.000
(iii) Capital work-in-progress	489.959	1522.188	1649.672
(iv) Intangible assets under development	0.000	0.000	0.000
(b) Non-current Investments	326.281	327.815	325.092
(c) Deferred tax assets (net)	0.000	0.000	0.000
(d) Long-term Loan and Advances	435.974	607.268	675.557
(e) Other Non-current assets	39.022	117.974	205.429
Total Non-Current Assets	12658.835	12567.472	11713.713
(2) Current assets
(a) Current investments	0.000	0.000	0.000
(b) Inventories	3215.453	2955.322	3075.471
(c) Trade receivables	1020.348	1910.850	1263.307
(d) Cash and cash equivalents	194.709	208.726	70.778
(e) Short-term loans and advances	2025.067	2578.104	3316.715
(f) Other current assets	68.241	83.876	57.970
Total Current Assets	6523.818	7736.878	7784.241
TOTAL	19182.653	20304.350	19497.954

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2015	31.03.2014	31.03.2013
	SALES
		Revenue from operations (Net)	10920.781	11927.638	9215.618
		Other Income	54.635	362.951	59.399
		TOTAL (A)	10975.416	12290.589	9275.017
Less	EXPENSES
		Cost of raw material and components consumed	9040.984	7330.548	5261.213
		Purchase of traded goods	408.113	1295.819	840.281
		Changes in inventories of finished goods, work-in-progress and traded goods	(272.799)	160.756	(83.534)
		Employee benefits expenses	316.845	305.480	250.248
		Other expenses	1370.618	1245.155	1337.006
		TOTAL (B)	10863.761	10337.758	7605.214
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		111.655	1952.831	1669.803
Less	FINANCIAL EXPENSES (D)		1093.203	1087.526	905.063
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		(981.548)	865.305	764.740
Less/ Add	DEPRECIATION/ AMORTISATION (F)		529.382	547.961	462.792
	PROFIT BEFORE TAX (E-F) (G)		(1510.930)	317.344	301.948
Less	TAX (H)		(485.218)	107.310	100.696
	PROFIT AFTER TAX (G-H) (I)		(1025.712)	210.034	201.252
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		2560.230	2350.196	2097.269
Add	Income tax earlier year			0.000	54.583
Less	APPROPRIATIONS
	Dividend			0.000	2.502
	Dividend tax			0.000	0.406
	Dividend distribution tax			0.000	0.000
	Proposed Dividend on preference shares			0.000	0.000
	Dividend distribution tax on above			0.000	0.000
	Proposed final equity dividend			0.000	0.000
			NA	0.000	2.908
	BALANCE CARRIED TO THE B/S			2560.230	2350.196
	EARNINGS IN FOREIGN CURRENCY
		FOB Value of Exports		596.855	322.056
	TOTAL EARNINGS			596.855	322.056
	IMPORTS
		Raw Materials		958.445	567.756
		Stores & Spares		13.119	26.944
		Capital Goods		37.109	0.516
	TOTAL IMPORTS			1008.673	595.216
	Earnings Per Share (Rs.)		(11.64)	2.38	2.96

CURRENT MATURITIES OF LONG TERM DEBT DETAILS

Particulars	31.03.2015	31.03.2014	31.03.2013
Current Maturities of Long term debt	NA	840.876	1072.897
Cash generated from operations	NA	2365.297	(1396.824)

KEY RATIOS

PARTICULARS		31.03.2015	31.03.2014	31.03.2013
Net Profit Margin (PAT/Sales)	(%)	(9.39)	1.76	2.18
Operating Profit Margin (PBITD/Sales)	(%)	1.02	16.37	18.12
Return on Total Assets (PBT/Total Assets}	(%)	(8.23)	1.72	1.72
Return on Investment (ROI) (PBT/Networth)		(0.25)	0.05	0.04
Debt Equity Ratio (Total Debt/Networth)		1.88	1.51	1.46
Current Ratio (Current Asset/Current Liability)		1.59	1.12	1.10

STOCK PRICES

Face Value	Rs.10.00
Market Value	Rs.12.301

FINANCIAL ANALYSIS

[all figures are in Rupees Million]

DEBT EQUITY RATIO

Particular	31.03.2013	31.03.2014	31.03.2015
	(Rs. In Million)	(Rs. In Million)	(Rs. In Million)
Share Capital	968.940	1088.940	1088.940
Reserves & Surplus	4647.214	5937.249	4909.839
Money received against share warrants	0.000	0.000	0.000
Share Application money pending allotment	1290.000	0.000	0.000
Net worth	6906.154	7026.189	5998.779
long-term borrowings	5024.423	5722.127	8952.105
Short term borrowings	3832.497	3868.905	2331.464
Total borrowings	10070.594	10619.560	11283.569
Debt/Equity ratio	1.458	1.511	1.881

YEAR-ON-YEAR GROWTH

Year on Year Growth	31.03.2013	31.03.2014	31.03.2015
	(Rs. In Million)	(Rs. In Million)	(Rs. In Million)
Sales	9215.618	11927.638	10920.781
		29.429	(8.441)

NET PROFIT MARGIN

Net Profit Margin	31.03.2013	31.03.2014	31.03.2015
	(Rs. In Million)	(Rs. In Million)	(Rs. In Million)
Sales	9215.618	11927.638	10920.781
Profit	201.252	210.034	(1025.712)
	2.18%	1.76%	(9.39%)

LOCAL AGENCY FURTHER INFORMATION

Sr. No.	Check List by Info Agents	Available in Report (Yes / No)
1]	Year of establishment	Yes
2]	Constitution of the entity -Incorporation details	Yes
3]	Locality of the entity	Yes
4]	Premises details	No
5]	Buyer visit details	--
6]	Contact numbers	Yes
7]	Name of the person contacted	Yes
8]	Designation of contact person	Yes
9]	Promoter’s background	Yes
10]	Date of Birth of Proprietor / Partners / Directors	Yes
11]	Pan Card No. of Proprietor / Partners	No
12]	Voter Id Card No. of Proprietor / Partners	No
13]	Type of business	Yes
14]	Line of Business	Yes
15]	Export/import details (if applicable)	No
16]	No. of employees	No
17]	Details of sister concerns	Yes
18]	Major suppliers	No
19]	Major customers	No
20]	Banking Details	Yes
21]	Banking facility details	Yes
22]	Conduct of the banking account	--
23]	Financials, if provided	Yes
24]	Capital in the business	Yes
25]	Last accounts filed at ROC, if applicable	Yes
26]	Turnover of firm for last three years	Yes
27]	Reasons for variation <> 20%	--
28]	Estimation for coming financial year	No
29]	Profitability for last three years	Yes
30]	Major shareholders, if available	Yes
31]	External Agency Rating, if available	Yes
32]	Litigations that the firm/promoter involved in	--
33]	Market information	--
34]	Payments terms	No
35]	Negative Reporting by Auditors in the Annual Report	No

UNSECURED LOAN

(Rs. In Million)

Particulars	As on 31.03.2015	As on 31.03.2014
Long term borrowings
Inter Corporate Deposits		458.486
Loans and Advances from related parties		495.750
Short term borrowings
Inter Corporate Deposits		30.202
Total	NA	984.438

EXPANSION PROJECT (As on 31.03.2014)

The Management with a view to modernize and expand the existing facilities at its plant at Raigarh has decided to take up a new project which includes setting up of one new Induction Furnace, Brick Making Plant, Expansion of Rolling and Structural Rolling Mill, Setting up of hot billet charging system in Rolling & Structural Rolling Mill and some other modifications. With the above the capacity of rolling mill will add to the topline and margin of the company.

MANAGEMENT DISCUSSION AND ANALYSIS

INDIAN ECONOMIC SCENARIO

The global economy began its modest recovery in FY 2013-14 with improved demand from OECD economies in the second half of 2013. While the trend is expected to accelerate in the current year, the positive outlook is subdued by the potential consequences of tapering. Emerging market like India faced multiple challenges, capital outflows, intense exchange rate pressures and volatile current account movement. The financial year 2013-14 turned out to be a challenging one for the Indian economy. In the context where the International Monetary Fund (IMF) has predicted around 4% global growth for calendar years 2014-18, CRISIL’s 6.5% growth estimate for India appears pretty decent. Of the 188 countries that the IMF has forecasts for, 151 are expected to lag India over the next five years. However, the fiscal and monetary initiatives taken by the Indian Government and Reserve Bank of India helped stablise financial market conditions, but the domestic macro environment still remains challenging. An improvement in investment efficiency, which has fallen drastically over the last two years, is expected to kick in with faster project clearances, implementation of stalled infrastructure projects and resumption of mining activities. This, in turn, will support investment growth, especially when demand – both domestic and global – begins to rebound, improving capacity utilisation, thus laying the foundation for India’s entry into a phase of healthier growth. So the task before the new government is laid out clearly – the focus has to be on improving the efficiency of the economy by debottlenecking it. Prime Minister Narendra Modi, who took oath to office on May 26 with the strongest parliamentary majority in 30 years, has vowed to engineer a turnaround by stepping up investment and clearing regulatory hurdles for businesses. The new government is without doubt in a very strong position to push through reforms.

The performance of the economy has been mixed so far in F.Y 2014–15 with a stable rupee, strong stock market performance, rising inflation, stagnant industrial production and narrowing trade deficit. Further, there have been developments across the globe with signs of recovery in the US, continued stimulus by the ECB to foster growth in the Euro region and most recent Iraq crisis which triggered off a spike in oil prices.

GLOBAL STEEL INDUSTRY

Global growth picked up in the second half of 2013, averaging 3.67% from the 2.33% recorded during the previous six months partly driven by increases in inventory. This beings overall growth in 2013 to 3% for the global economy with advanced economies growing by 1.3% and emerging markets by 4.7%. Advanced economies accounted for much of the pickup, whereas growth in emerging markets increased only modestly.

The strengthening in activity was mirrored in global trade and industrial production. IMF suggests a slight moderation in global growth in the first half of 2014. Overall, global growth is projected to strengthen to 3.6% in 2014 and 3.9% in 2015. A major impulse to global growth came from USA where the economy grew at 3.25% in the second half of 2013. Some of this was due to strong export growth and temporary increases in inventory demand. This was also backed up by accommodative monetary conditions as well as the real estate sector, higher household wealth and easier bank lending conditions.

BUSINESS OVERVIEW

PERFORMANCE REVIEW OF THE COMPANY

The Company is engaged in steel business, which, in context of Accounting Standard (AS -17) issued by the Institute of the Chartered Accountants of India, is considered to be the only business segment. The Company’s overall operational performance has been satisfactory during the year.

FINANCIAL MANAGEMENT

The senior management personnel periodically monitors the capital budgeting and subsequent progress of the under-implemented projects. The projects are funded by borrowing from a consortium of banks at competitive rates; the balance is covered by internal accruals and promoter contribution. During the year, the Company issued 12000000, 6% Non Cummulative Redeemable Preference shares of Rs. 10 each at a premium of Rs. 90 per share .

The Company’s well-trained and highly efficient professionals are responsible for overseeing factory operations as well as the functions of the accounting and finance department. The team ensures that the established organisational procedures laid down by the senior management at a strategic level are followed and translated even in financial results and periodic management reports. Regular audits are conducted to ensure that the proper controls are in place.

FINANCIAL PERFORMANCE

During 2013-14, the Company performed satisfactorily, commissioning its 117000 Mt of Steel Melting Shop, 25,000 Mt of Rolling Mill and 40,000 Mt of Light Structural Rolling Mill is under construction. Going forward, the Company expects that revenues from the newly commissioned projects to improve the overall margins and increase profitability. Besides, incremental capacity utilisations from other existing projects are also likely to help improve the revenues and EBITDA margins in the years to come.

INDEX OF CHARGES

S.No.	Charge ID	Date of Charge Creation/Modification	Charge amount secured	Charge Holder	Address	Service Request Number (SRN)
1	10482710	25/02/2014	260,000,000.00	ALLAHABAD BANK	STEPHEN HOUSE BRANCH, 4, B. B. D BAG (EAST), KOLKATA, West Bengal - 700001, INDIA	B98527609
2	10481832	24/02/2014	240,000,000.00	UNION BANK OF INDIA	Industrial Finance Branch, 1/1, Camac Street, 1st Floor, Kolkata, West Bengal - 700016, INDIA	B98197999
3	10464244	06/12/2013	350,000,000.00	ICICI BANK LIMITED	LANDMARKRACE COURCE CIRCLE, ALKAPURI, BARODA, Gujarat - 390015, INDIA	B91149534
4	10444842	16/07/2013	160,000,000.00	STATE BANK OF BIKANER AND JAIPUR	Ballygunge Branch,, 204, Rashbehari Avenue, Kolkata, West Bengal - 700029, INDIA	B82994112
5	10482159	01/07/2013	250,000,000.00	SYNDICATE BANK	BARABAZAR BRANCH, 132/1 M.G.ROAD, KOLKATA, West Bengal - 700007, INDIA	B85634988
6	10410324	01/03/2013	500,000,000.00	UNION BANK OF INDIA	INDUSTRIAL FINANCE BRANCH, 1/1, CAMAC STREET, 1ST  FLOOR, KOLKATA, West Bengal - 700016, INDIA	B70269584
7	10380159	11/09/2012	4,485,000.00	TATA CAPITAL FINANCIAL SERVICES LIMITED	One Forbes,, Dr. V. B. Gandhi Marg, Fort, Mumbai,  Maharashtra - 400001, INDIA	B59535740
8	10347495	10/04/2012	550,000,000.00	ORIENTAL BANK OF COMMERCE	Park Street Branch,, 107/1, Park Street (1st Floor), Kolkata, West Bengal - 700016, INDIA	B36950814
9	10345761	27/02/2012	200,000,000.00	DENA BANK	CORPORATE BUSINESS BRANCH, 238B, AJC BOSE ROAD, K  OLKATA, West Bengal - 700020, INDIA	B36374353
10	10338265	30/01/2012	100,000,000.00	ING VYSYA BANK LIMITED	4/1,MIDDLETON STREET, SIKKIM HOUSE, KOLKATA, West  Bengal - 700071, INDIA	B33271073

* Date of charge modification

FIXED ASSETS:

• Land
• Factory Buildings
• Non Factory Buildings
• Plant and Machinery
• Vehicles
• Furniture and Fixtures

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 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. 64.11
UK Pound	1	Rs. 100.32
Euro	1	Rs. 72.17

INFORMATION DETAILS

Information Gathered by :	KMN
Analysis Done by :	KAR
Report Prepared by :	JYTK

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	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	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.