MIRA INFORM REPORT

Report No. :	484273
Report Date :	11.01.2018

IDENTIFICATION DETAILS

Name :	SHPS EUROASIAN STEELS
Registered Office :	Tsinamdzghvrishvili Street 110, Old Tbilisi District, 0112 Tbilisi
Country :	Georgia
Financials (as on) :	31.03.2017
Date of Incorporation :	01.04.2008
Com. Reg. No.:	B16169601
Legal Form :	Limited Liability Company
Line of Business :	Manufacturers and exporters of steel products, scrap-iron, armature and billets.
No. of Employees :	8 (plans to increase up to 400 staff by April 2018)

RATING & COMMENTS

(Mira Inform has adopted New Rating mechanism w.e.f. 23^rd January 2017)

MIRA’s Rating :

B

Credit Rating	Explanation	Rating Comments
B	Medium Risk	Business dealings permissible on a regular monitoring basis

Status :	Moderate
Payment Behaviour :	Slow but Correct
Litigation :	Clear

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

Country Name	Previous Rating (30.06.2017)	Current Rating (30.09.2017)
Georgia	C1	C1

Risk Category	ECGC Classification
Insignificant	A1
Low Risk	A2
Moderately Low Risk	B1
Moderate Risk	B2
Moderately High Risk	C1
High Risk	C2
Very High Risk	D

GEORGIA - ECONOMIC OVERVIEW

Georgia's main economic activities include cultivation of agricultural products such as grapes, citrus fruits, and hazelnuts; mining of manganese, copper, and gold; and producing alcoholic and nonalcoholic beverages, metals, machinery, and chemicals in small-scale industries. The country imports nearly all of its needed supplies of natural gas and oil products. It has sizeable hydropower capacity that now provides most of its energy needs.

Georgia has overcome the chronic energy shortages and gas supply interruptions of the past by renovating hydropower plants and by increasingly relying on natural gas imports from Azerbaijan instead of from Russia. Construction of the Baku-T'bilisi-Ceyhan oil pipeline, the South Caucasus gas pipeline, and the Kars-Akhalkalaki railroad are part of a strategy to capitalize on Georgia's strategic location between Europe and Asia and develop its role as a transit hub for gas, oil, and other goods.

Georgia's economy sustained GDP growth of more than 10% in 2006-07, based on strong inflows of foreign investment and robust government spending. However, GDP growth slowed following the August 2008 conflict with Russia, and sunk to negative 4% in 2009 as foreign direct investment and workers' remittances declined in the wake of the global financial crisis. The economy rebounded in the period 2010-16, but FDI inflows, the engine of Georgian economic growth prior to the 2008 conflict, have not recovered fully. Unemployment has also remained high.

The country is pinning its hopes for renewed growth on a continued effort to liberalize the economy by reducing regulation, taxes, and corruption in order to attract foreign investment, with a focus on hydropower, agriculture, tourism, and textiles production. Georgia has historically suffered from a chronic failure to collect tax revenues; however, since 2004 the government has simplified the tax code, increased tax enforcement, and cracked down on petty corruption, leading to higher revenues. Georgia plans to improve the domestic investment environment through a four-year economic plan targeting the tax system, educational standards, infrastructure, and governance. The government has received high marks from the World Bank for improvements in business transparency. Since 2012, the Georgian Dream-led government has continued the previous administration's low-regulation, low-tax, free market policies, while modestly increasing social spending, strengthening anti-trust policy, and amending the labor code to comply with International Labor Standards. In mid-2014, Georgia signed an association agreement with the EU, paving the way to free trade and visa-free travel. Georgia is also seeking to expand trade with China, concluding substantive negotiations on a trade agreement in October 2016.

Source : CIA

SUMMARY

COMPANY NAME	ShPS Euroasian Steels
ADDRESS	Building	Street			Area			PO Box
	N/A	Tsinamdzghvrishvili Street 110			Old Tbilisi District			0107 Tbilisi
TEL/FAX	Verified Phones: +(995 32) 295 5805 (temporarily out of service) / +(995 32) 295 8928 (temporarily out of service) / Mobile +(91 98) 3000 6101 (Navneet Manaksia) Fax: +(995 32) 296 0096
EMAIL	Email: navneet@manaksia.com / esl-info@internet.ge
ACTIVITY	NACE 2410 - Manufacture of basic iron and steel and of ferro-alloys;
PRINCIPAL	Navneet Manaksia					Workforce
	Chief Executive Officer					8
LEGAL INFO	Date Of Est.		Reg. No.	Legal Form			Status
	01/04/2008		ID Code: 204552108	Limited Liability Company			Active
CAPITAL	CURRENCY			AMOUNT
	LARI (GEL)			16,700,000

IDENTIFICATION
CO. NAME	ShPS Euroasian Steels
ENQUIRED NAME	Euroasian Steels LLC
ALSO KNOWN NAME (S)	ShPS Evrazian Stils / Kutaiskiy Metallurgicheskiy Zavod Gerkules / Metallurgy Factory of Kutaisi Hercules
STREET	Tsinamdzghvrishvili Street 110
AREA	Old Tbilisi District
POSTAL ADDRESS	0107 Tbilisi
CITY	Tbilisi
COUNTRY	Georgia
TELEPHONE	+(995 32) 295 5805 (temporarily out of service) / +(995 32) 295 8928 (temporarily out of service) / Mobile +(91 98) 3000 6101 (Navneet Manaksia) / +(995 577) 209 102
FAX	+(995 32) 296 0096
VERIFIED EMAIL	navneet@manaksia.com / esl-info@internet.ge / chkhenkelip@gmail.com
WEBSITE	N/A
BUSINESS HOURS	DAYS	OFFICE HOURS	BREAK TIME
	Mon-Fri	10:00-18:00	13:00-14:00
REGISTERED ADDRESS	Tsinamdzghvrishvili Street 110, Old Tbilisi District, 0112 Tbilisi
FACTORY ADDRESS	Imereti Region, Kutaisi, Shevchenko Street 10

SENIOR PERSONNEL
MANAGEMENT	NAME	POSITION
	Navneet Manaksia Personal profile: Chemical Engineer from Manipal Institute of Technology and Management graduate from Wharton Business School, U.Penn, Mr. Manaksia looks after all the operations in India and Georgia.	Chief Executive Officer
	Paata Chkhenkeli Personal profile: He was born in 1959. In 1983 he graduated from Georgian Technical University (GTU), specializing in building-engineering. Between 1976 and 1989 he worked as a constructor-engineer in different construction companies. From 1989 to 2000 he was the Director of Iberia Construction Company, thereby working in Russia, UK and Georgia. In 2000-2003 Paata Chkhenkeli worked as a State Adviser to the Minister of Economy of Georgia.	Executive Director
WORKFORCE	NO. OF EMPLOYEES	PERIOD
	8 (plans to increase up to 400 staff by April 2018)	01.2018
	350	11.2015

FINANCIAL SUMMARY
REVENUE	31/03/2016	31/03/2015
	LARI 8,575,256.71	LARI 17,207,102.82
NET PROFIT / (LOSS)	31/03/2016	31/03/2015
	LARI (-25,754.24)	LARI 13,015.99
STOCK/INVENTORIES	LARI 2,227,914.19 as of 31/03/2017

LEGAL STATUS
INCORPORATION	01/04/2008
REGISTRATION NO.	C.R. NUMBER	ISSUED BY
	B16169601	Ministry of Justice
OTHER REGISTRATION NO.	204552108(Taxpayer Identification Number)
AUTHORISED CAPITAL	AMOUNT	CURRENCY
	16,700,000	LARI
PAID-UP CAPITAL	AMOUNT	CURRENCY
	16,700,000	LARI
LEGAL FORM	Limited Liability Company
BUSINESS HISTORY	The company was incorporated in Georgia on 1 April 2008, however its origins can be traced back to 2005. On 28 June 2011, subject acquired assets and operations of JSC Kutaisi Reinforced Concrete (ID Code: 212679519). On 9 November 2015, subject temporarily ceased its production due to decrease in steel prices globally. However, subject plans to resume its production by March/April 2018.
STATUS	Active
SHAREHOLDERS	NAME	PERCENTAGE
	1. Euroasian Ventures FZE PO Box 17707 JAFZA View 19 25th Floor, Office No. 07 Jebel Ali Free Zone Dubai UAE Tel: (+971 4) 886 5838 Fax: (+971 4) 886 5839 2. Paata Chkhenkeli (Personal ID No.: 01017000386)	87.5% 12.5%

OPERATION
BANKERS	1. JSC TBC Bank 7 Marjanishvili Street 0102 Tbilisi Georgia Telephone: (+995 32) 227 2727 Fax : (+995 32) 277 2774 Acc. No. : GE72TB7599036180100001 (GEL) 2. JSC Cartu Bank I. Chavchavadze Avenue 39a 0162 Tbilisi Georgia Telephone: (+995 32) 200 8080 Fax : (+995 32) 291 2279 Acc. No. : 1563606 (GEL) Acc. No. : 1563616 (USD
AUDITORS	Georgian Business Consulting Group Ltd (TaxInfo Group) Kostava I Lane, B. 5, R. 1 Telephone: (+995 558) 929 929 E-Mail: contact@taxinfo.ge ID Code: 404379203
ACTIVITY CODE (NACE)	2410 - Manufacture of basic iron and steel and of ferro-alloys;
LINE OF BUSINESS	Manufacturers and exporters of steel products, scrap-iron, armature and billets. Annual production capacity: 96,000 tonnes of armature.
IMPORT FROM	LIST OF COUNTRIES	PAYMENT TERMS
	1. UAE (Dubai) 2. India	Bill of exchange Bill of exchange
EXPORT TO	Iran, India and Sri Lanka.
FACILITIES	Rented premises comprising administrative offices located at the heading address as well as owned 100,000 sq. m. manufacturing unit with warehousing facilities located at Shevchenko Street 10, Kutaisi city, Imereti Region.
RELATED COMPANIES	Subject is a member of Manaksia multi-division and multi-location conglomerate, which also includes the following companies: Associates 1. Manaksia Limited Kolkata 700 001 India Tel: (+91 33) 2231 0050/51/52 2. Manaksia Industries Limited Kolkata 700 001 India Tel: (+91 33) 2231 0050/51/52 3. Manaksia Steels Limited Kolkata 700 001 India Tel: (+91 33) 2231 0050/51/52 4. Manaksia Aluminium Company Limited Kolkata 700 001 India Tel: (+91 33) 2231 0050/51/52 5. Manaksia Coated Metals & Industries Ltd Kolkata 700 001 India Tel: (+91 33) 2231 0050/51/52 6. Dynatech Industries Ghana Limited Plot No. 138, Batsonaa, Accra-Terna Motorway Industrial Area Spintes Road Accra Ghana Tel: (+233) 218 1547 Fax: (+233) 218 1549 Email: dynatech@idngh.com 7. MINL Limited 21/23, Abimbola Street, Isolo Industrial Estate Isolo Lagos Nigeria Tel: (+23 41) 452 9135/37 Fax: (+23 41) 452 9136 Email: minl-ltd@multilink.com 8. Technomet International FZE Jebel Ali Free Zone Dubai United Arab Emirates 9. BKM Industries Limited Kolkata 700 001 India Tel: (+91 33) 2231 0050/51/52 10.Jiwanjyoti Vanijya Pvt. Ltd 11.Glitter Agencies Pvt. Ltd. 12.BK Manaksia Nigeria Ltd 13.Arena Machineries Ltd. Affiliated companies of Mr. Paata Chkhenkeli in Georgia: 1. ShPS Solar Led Tevdore Mghvdlis Street 31 Tbilisi Email: solarledltd@gmail.com Est.: 29/10/2015 ID Code: 402022994 2. ShPS Inter Produkti Tsinamdzghvrishvili Street 110 Tbilisi Email: natinati__86@mail.ru Est.: 24/09/2014 ID Code: 432542402 3. ShPS Metro Vake Saburtalo District Tbilisi Email: chkhenkelip@gmail.com Est.: 22/11/2016 ID Code: 405177320 4. ShPS Geo-Konstrakshen Tsinamdzghvrishvili Street 110 Tbilisi Email: chkhenkelip@gmail.com Est.: 24/08/2015 ID Code: 402019374 5. ShPS Chela Tevdore Mghvdlis Street 31 Tbilisi Email: aleksankandelaki@hotmail.com Est.: 22/04/2015 ID Code: 404492116 6. ShPS Jorjia Metaliks Limited Tsinamdzghvrishvili Street 110 Tbilisi Email: chkhenkelip@gmail.com Est.: 24/03/2004 ID Code: 205024855 7. ShPS Mialpa Marin Servisi Melikishvili Street 14 Batumi Est.: 20/09/2013 ID Code: 445431685 8. ShPS Kartul- ranguli Saganmanatleblo Tsentri Kostava Street 75a Tbilisi Email: dolidze83@yahoo.com Est.: 28/01/2011 ID Code: 404885781 9. ShPS Asteria Chavchavadze Avenue 74 Tbilisi Est.: 05/10/2001 ID Code: 204886409

FINANCIAL INFORMATION
CURRENCY	LARI (GEL)
PERIOD	31/03/2016	31/03/2015
CURRENT ASSETS	10,919,430.16	11,636,596.79
STOCK/INVENTORIES	2,227,914.19	4,002,506.53
NON-CURRENT ASSETS	30,081,516.31	33,352,054.82
CURRENT LIABILITIES	2,589,799.39	6,551,750.30
NON-CURRENT LIABILITIES	33,531,440.39	33,531,440.39
EQUITY	4,879,706.68	4,905,460.92
BALANCE TOTAL	41,000,946.47	44,988,651.61
REVENUE	8,575,256.71	17,207,102.82
NET PROFIT / LOSS	(-25,754.24)	13,015.99
CURRENT RATIO	4.2	1.8
NOTES	Balance sheets as at 31 March 2017 showed : 31/03/2017 31/03/2016 (in LARI) EQUITY AND LIABILITIES Shareholder’s Funds Share Capital 16,700,000 16,700,000 Reserves and Surplus (11,837,760) (11,820,293) 4,862,239 4,879,706 Non-Current Liabilities Long-Term Borrowings 33,531,440 33,531,440 33,531,440 33,531,440 Current Liabilities Trade Payables 1,125,125 1,125,125 Other Current Liabilities 1,464,674 1,464,674 2,589,799 2,589,799 TOTAL 40,983,479 41,000,946 ASSETS Non-Current Assets Fixed Assets Tangible Assets 27,431,080 27,431,080 Intangible Assets 18,602 18,602 Capital work-in- Progress 2,631,833 2,631,833 30,081,516 30,081,516 Current Assets Inventories 2,227,914 2,227,914 Trade Receivables 6,444,502 6,444,502 Cash and Bank Equivalents 142,588 160,055 Short-Term Loans and Advances 2,086,957 2,086,957 10,901,963 10,919,430 TOTAL 40,983,479 41,000,946 PROFIT AND LOSS ACCOUNT Revenue - 8,575,256 Expenses: Cost of Materials Consumed - 3,737,310 Changes inventories of finished Goods, work-in-progress and Stock-in-Trade - 37,282 Employee Benefits Expenses 14,035 748,099 Depreciation and Amortization Expense - 3,270,538 Other Expenses 3,432 807,780 Total Expenses 17,467 8,601,010 Profit(Loss) for the Period (17,467) (25,754) The following balance sheets as at 31 March 2017 applies to subject’s parent company, Euroasian Ventures FZE: 31/03/2017 31/03/2016 (in AED) ASSETS Non-current assets Investments 34,406,250 34,406,250 Total non-current assets 34,406,250 34,406,250 Current assets Due from related parties 95,182,339 95,447,906 Trade receivables 2,190,201 1,712,422 Other current assets 10,566,619 10,385,545 Cash and cash equivalents 44,583 33,277 Total current assets 107,983,742 107,579,150 TOTAL ASSETS 142,389,992 141,985,400 EQUITY & LIABILITIES Equity Share capital 25,000,000 25,000,000 Share application money 47,750 47,750 Retained earnings 79,793,158 68,220,473 Total equity 104,840,908 93,268,223 Non-current liabilities: Long-term liabilities 212,740 190,685 Total non-current Liabilities 212,740 190,685 Current liabilities Trade & other payables 19,918,450 30,158,613 Accrued expenses 5,000 23,254 Due to related parties 17,412,894 18,344,625 Total current liabilities 37,336,344 48,526,492 Total liabilities 37,549,084 48,717,177 TOTAL EQUITY & LIABILITIES 142,389,992 141,985,400 INCOME STATEMENT Revenue 3,204,938 17,638,717 Direct expenses (2,471,745) (12,903,882) Gross profit 733,193 4,734,835 Other income 11,573,912 9,151,186 Operating expenses Administrative expenses 504,607 945,273 Finance charges 229,813 202,943 Total operating expenses (734,420) (1,148,216) Profit from continuing Operations 11,572,685 12,737,805 Net profit for the year 11,572,685 12,737,805

PAYMENT
CREDIT OPINION	We consider it is acceptable to deal with subject for MEDIUM amounts.
FINANCIAL STRENGTH	Normal
EMPLOYEE RANGE	ER7

SPECIAL REMARKS
INTERVIEWED	Navneet Manaksia (Chief Executive Officer).
COMMENTS	Euroasian Steels LLC. Please note that this name applies to an English translation of the subject’s name. Subject’s correct registered name is as per heading.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	INR 63.83
UK Pound	1	INR 86.28
Euro	1	INR 76.13
GEL	1	INR 24.80

Note : Above are approximate rates obtained from sources believed to be correct

INFORMATION DETAILS

Analysis Done by :	PRI
Report Prepared by :	TRU

RATING EXPLANATIONS

Credit Rating	Explanation	Rating Comments
A++	Minimum Risk	Business dealings permissible with minimum risk of default
A+	Low Risk	Business dealings permissible with low risk of default
A	Acceptable Risk	Business dealings permissible with moderate risk of default
B	Medium Risk	Business dealings permissible on a regular monitoring basis
C	Medium High Risk	Business dealings permissible preferably on secured basis
D	High Risk	Business dealing not recommended or on secured terms only
NB	New Business	No recommendation can be done due to business in infancy stage
NT	No Trace	No recommendation can be done as the business is not traceable

NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.

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 are as follows:

· Financial condition covering various ratios

· Company background and operations size

· Promoters / Management background

· Payment record

· Litigation against the subject

· Industry scenario / competitor analysis

· Supplier / Customer / Banker review (wherever available)

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