MIRA INFORM REPORT

Report No. :	350398
Report Date :	25.11.2015

IDENTIFICATION DETAILS

Name :	POPATLAL NATHALAL SHAH
Registered Office :	GW-7022, Bharat Diamond Bourse, Bandra Kurla Complex, Bandra (East), Mumbai – 400051, Maharashtra
Tel No.:	91-22-42491111 (40 lines)
Country :	India
Financials (as on) :	31.03.2015
Year of Establishment :	1956
Capital Investment / Paid-up Capital :	Rs.536.584 Million
IEC No.:	0388052635
TIN No.:	Not Available
TAN No.: [Tax Deduction & Collection Account No.]	MUMP04028D
PAN No.: [Permanent Account No.]	AAAFP0468K
Legal Form :	Partnership Concern with an unlimited liability of the partners
Line of Business :	Manufacturer, trader, exporter and Importer of Diamonds. Manufacturing done through job work
No. of Employees :	16 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

Ba (43)

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

Status :	Satisfactory
Payment Behaviour :	Usually correct
Litigation :	Clear
Comments :	Subject was set up as a proprietorship firm in 1956 by the late Mr. Popatlal Nathalal Shah. The firm was reconstituted as a partnership firm in 1990. The firm is engaged in cutting and polishing diamonds. It currently has three partners – Mr. Ajay P. Shah, Mrs. Priti Shah and Mr. Nirav Shah. The ratings reflect the extensive experience of PNS’s partners in the diamond industry and the firm’s established relationships with customers. The ratings also reflects its above-average financial risk profile marked by modest net worth average debt protection metrics. Rating strengths is partially offset by its large working capital requirements and the susceptibility of profitability margins to volatility in diamond prices and fluctuations in foreign exchange rates. Trade relations are reported as fair. Payment terms are reported to be usually correct. The concern can be considered for business dealings at usual trade terms and condition.

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	CRISIL
Rating	Long term rating : BB-
Rating Explanation	Inadequate-credit-quality and high credit risk.
Date	18.09.2015

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 31-03-2015.

INFORMATION PARTED BY

Name :	Mr. Jignesh Shah
Designation :	Accountant
Contact No.:	91-22-23611280
Date :	20.11.2015

LOCATIONS

Registered Office :	GW-7022, Bharat Diamond Bourse, Bandra Kurla Complex, Bandra (East), Mumbai – 400051, Maharashtra, India
Tel No.:	91-22-42491111 (40 lines)
Mobile No.:	91-9820978800 (Mr. Jignesh)
Fax No.:	91-22-42491100
E-Mail :	info@pnshah.com nirav@pnshah.com
Website :	www.pnshah.com
Area :	750 sq. ft.
Location :	Owned
Locality :	Commercial
Branch Office 1 :	1802, Panchratna, Opera House, Mumbai - 400004, Maharashtra, India
Tel. No.:	91-22-23611280/ 23693863/ 4782
Area :	2429 sq. ft.
Location :	Owned
Locality :	Commercial
Branch Office 2 :	Mahavir Chamber, Tartiya Hanuman Sheri, Surat, Gujarat, India
Area :	250 sq. ft.
Location :	Rented
Locality :	Commercial

PARTNERS

Name :	Mr. Ajay P. Shah
Designation :	Partner
Address :	Fionika, 1st Floor,  59/B, Walkeshwar Road, Mumbai-400006, Maharashtra, India
Name :	Mr. Priti Ajay Shah
Designation :	Partner
Address :	Fionika, 1st Floor,  59/B, Walkeshwar Road, Mumbai-400006, Maharashtra, India
Name :	Mr. Nirav Ajay Shah
Designation :	Partner
Address :	Fionika, 1st Floor,  59/B, Walkeshwar Road, Mumbai-400006, Maharashtra, India

KEY EXECUTIVES

Name :	Mr. Jignesh Shah
Designation :	Accountant

BUSINESS DETAILS

Line of Business :	Manufacturer, trader, exporter and Importer of Diamonds. Manufacturing done through job work
Products :	Diamonds
Brand Names :	---
Agencies Held :	---
Exports :
Products :	Finished goods
Countries :	· Hong Kong · United States of America · Canada · Belgium
Imports :
Products :	Raw Material
Countries :	· Israel · Duabi · Belgium
Terms :
Selling :	Cash, L/C, Credit
Purchasing :	Cash, L/C, Credit

GENERAL INFORMATION

Suppliers :

Reference :	Blue Star, Mumbai
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 :

Wholesalers, Retailers and Manufacturer

Reference :	Pam Star Exports, Mumbai
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 :

16 (Approximately)

Bankers :

Banker Name :	Indusind Bank Limited
Branch Address :	BKC, Bandra (East), Mumbai-400051, Maharashtra, India
Person Name :	Not Available
Contact No.:	91-22-26754141 (Ringing)
Name of Account Holder	Not Available
Account Number	Not Available
Account Since (Date/Year of Account Opening)	Not Available
Average Balance Maintained (If Possible)	Not Available
Credit Facilities Enjoyed (If any)	Not Available
Account Operation	Not Available
Remarks (If any)	Not Available

Facilities :

SECURED LOANS	31.03.2015 (Rs. In Million)	31.03.2014 (Rs. In Million)
Loan and Borrowings From Bank
The Royal bank of Scotland N.V. (Post Shipment)		52.784
The Royal bank of Scotland N.V. (Packing Credit)		452.131
Antwerp Diamond Bank N.V. (Post Shipment)		143.101
Antwerp Diamond Bank N.V. (Packing Credit)		0.000
State Bank of India (Packing Credit)		0.023
State Bank of India (Packing Credit)		38.599
State Bank of India (Post Shipment)		25.265
Add: Borrowing Translation Control A/C		(3.152)
Total	NA	708.751

Auditors :
Name :	Sampat Mehta and Associates Chartered Accountants
Address :	Mumbai, Maharashtra, India
Memberships :	--
Collaborators :	--
Related Parties :	· Nirjay Diamond · Paras Gems NV

CAPITAL STRUCTURE

As on: 31.03.2015

Capital Investment :
Owned :	Rs.536.584 Million
Borrowed :	--
Total :	Rs.536.584 Million

FINANCIAL DATA

[all figures are in Rupees Million]

Expected Sales (2015-2016): Rs. 2800.000 Million

The above information has been parted by Mr. Jignesh Shah (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		31.03.2015	31.03.2014	31.03.2013
SHAREHOLDERS FUNDS
1] Partners Capital		536.584	509.599	459.173
2] Share Application Money		0.000	0.000	0.000
3] Profit and Loss Account		0.000	0.000	0.000
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		536.584	509.599	459.173
LOAN FUNDS
1] Secured Loans		866.446	708.751	703.413
2] Unsecured Loans		22.089	6.898	1.355
TOTAL BORROWING		888.535	715.649	704.768
DEFERRED TAX LIABILITIES		1.845	2.370	1.901
TOTAL		1426.964	1227.618	1165.842
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		185.189	188.505	185.093
Capital work-in-progress		0.000	0.000	0.000
INVESTMENT		0.000	0.000	0.000
DEFERRED TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	834.406	815.765	708.989
	Sundry Debtors	417.488	394.950	725.594
	Cash & Bank Balances	27.154	16.888	15.882
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	48.898	22.654	27.449
Total Current Assets		1327.946	1250.257	1477.914
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	86.171	211.144	497.165
	Other Current Liabilities	0.000	0.000	0.000
	Provisions	0.000	0.000	0.000
Total Current Liabilities		86.171	211.144	497.165
Net Current Assets		1241.775	1039.113	980.749
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		1426.964	1227.618	1165.842

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2015	31.03.2014	31.03.2013
	SALES
		Income	2820.725	2749.674	2175.112
		Other Income	8.339	6.115	12.053
		TOTAL	2829.064	2755.789	2187.165
Less	EXPENSES
		Cost of Goods Sold	2540.822	2487.814	2002.464
		Labour Charges	52.792	47.765	36.838
		Salaries	4.496	3.607	1.328
		Foreign Tour Expenses	1.907	1.483	2.144
		Printing and Stationery	0.165	0.182	0.133
		Telephone Expenses	0.450	0.601	0.572
		Internet Expenses	0.181	0.107	0.028
		Electricity Expenses	0.694	0.699	0.491
		Export Clearing Charges	0.657	0.632	0.405
		Exports Freight	3.482	2.994	2.000
		Import License Fees	0.000	0.000	0.005
		Office Repairs and Maintenance	1.419	1.509	1.379
		Bank Charges	10.215	16.297	14.789
		Loan Rating Charges	0.103	0.120	0.101
		Motor Car Expenses	0.864	1.149	0.955
		Audit Fees	0.342	0.337	0.337
		Other Expenses	161.392	145.012	91.823
		TOTAL	2779.981	2710.308	2155.792
	PROFIT / (LOSS) BEFORE DEPRECIATION AND AMORTISATION		49.083	45.481	31.373
Less	DEPRECIATION/ AMORTISATION		9.253	5.694	3.970
	NET PROFIT/ (LOSS)		39.830	39.787	27.403

KEY RATIOS

PARTICULARS		31.03.2015	31.03.2014	31.03.2013
Net Profit Margin (PAT / Sales)	(%)	1.41	1.45	1.26
Return on Total Assets (PBT/Total Assets}	(%)	2.63	2.77	1.65
Return on Investment (ROI) (PBT/Networth)		0.07	0.08	0.06
Debt Equity Ratio (Total Debt /Networth)		1.66	1.40	1.53
Current Ratio (Current Asset/Current Liability)		12.27	5.73	2.96

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)
Partner’s Capital	459.173	509.599	536.584
Reserves & Surplus	0.000	0.000	0.000
Net worth	459.173	509.599	536.584
Secured Loans	703.413	708.751	866.446
Unsecured Loans	1.355	6.898	22.089
Total borrowings	704.768	715.649	888.535
Debt/Equity ratio	1.535	1.404	1.656

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	2175.112	2749.674	2820.725
		26.415	2.584

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	2175.112	2749.674	2820.725
Profit	27.403	39.787	39.830
	1.26%	1.45%	1.41%

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	Yes
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	No
10	Date of Birth of Proprietor / Partners / Directors	No
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)	Yes
16	No. of employees	Yes
17	Details of sister concerns	Yes
18	Major suppliers	Yes
19	Major customers	Yes
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	No
26	Turnover of firm for last three years	Yes
27	Reasons for variation <> 20%	--
28	Estimation for coming financial year	Yes
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	Yes
35	Negative Reporting by Auditors in the Annual Report	No

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 and 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.

UNSECURED LOAN

PARTICULAR	31.03.2015 (Rs. In Million)	31.03.2014 (Rs. In Million)
Loan and Borrowings From Others
Paruben N. Shah Estate A/C		0.024
Popatlal N. Shah Estate A/C		1.330
Nirjay Diamond		5.544
Total	NA	6.898

FIXED ASSETS

· Air Condition

· Computer and Software

· Electric Scale

· Godrej Safe

· Machinery

· Office Furniture

· Office Premises

· Safeguard

· Telephone System

· CCTV Camera

· Office Furniture

· Honda Motor Car

· Computers

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.66.38
UK Pound	1	Rs.100.45
Euro	1	Rs.70.55

INFORMATION DETAILS

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

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	5
--PROFITABILITY	1~10	5
--LIQUIDITY	1~10	5
--LEVERAGE	1~10	4
--RESERVES	1~10	5
--CREDIT LINES	1~10	4
--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	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTER
--RBI	YES/NO	NO
--EPF	YES/NO	NO
TOTAL		43

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.