INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO.

: 1

MIRA INFORM REPORT

Report Date : 26.06.2012

IDENTIFICATION DETAILS

Name : DCW LIMITED

Registered Office : No. 2, Guest House, Dhrangadhra – 363315, Gujarat

Country : India

Financials (as on) : 31.03.2010

Date of Incorporation : 28.01.1939

Com. Reg. No.: 04-000748

Capital Investment / Paid- Rs.392.309 Millions

up Capital :

CIN No.: L24110GJ1939PLC000748

[Company Identification No.]

TAN No.: AHMD02579D

[Tax Deduction & Collection
Account No.]

PAN No.: AAACD0559N

[Permanent Account No.]

Legal Form : Public Limited Liability Company. Company’s Shares are Listed on the Stock
Exchange

Line of Business : Manufactures of Soda Ash, Caustic Soda, PVC Resins, Soda Bicarbonates,
Trichloroethylene, Synthetic Rutile, Titox, Utox, Bromine, Bromide and a Few
Other Chemicals.

No. of Employees : 2283 (Approximately)

RATING & COMMENTS

MIRA’s Rating : A (70)

RATING STATUS PROPOSED

CREDIT LINE

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 2

56-70 A Financial & operational base are regarded healthy. General unfavourable Fairly Large
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums

Maximum Credit Limit : USD 15000000

Status : Good

Payment Behaviour : Regular

Litigation : Clear

Comments : Subject is a well established and a reputed company having good track.
Financial position of the company appears to be sound. Trade relations are
reported as fair. Business is active. Payments are reported to be regular and as
per commitments.

The company can be considered good for normal business dealing at usual
trade terms and conditions.

NOTES :
Any query related to this report can be made on e-mail : [email protected] while quoting report number,
name and date.

ECGC Country Risk Classification List – April 1, 2010

Country Name Previous Rating Current Rating

(31.12.2009) (01.04.2010)
India A1 A1

Risk Category ECGC

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

LOCATIONS

Registered Office/Factory : No. 2, Guest House, Dhrangadhra – 363315, Gujarat, India

Tel. No.: 91-2754-5719967 / 76 / 44
Fax No.: 91-2754-5755731 / 283245
E-Mail : [email protected]

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 3

[email protected]
office@[email protected]
Website : http://www.dcwltd.com
rd
Corporate/ Head Office : Nirmal, 3 Floor, Nariman Point, Mumbai – 400021, Maharashtra, India
Tel. No.: 91-22-22781914 / 2871916
Fax No.: 91-22-22048838
E-Mail : [email protected]
st
Branch Office : Indra Palace, 1 Floor, H – Block, Connaught Circus, New Delhi-110001, Delhi,
India

Located At :

Chennai

Factory 1 : Caustic Soda Division:

Arumuganeri P. O., Sahupuram-628202, Tamilnadu, India

Factory 2 : PVC Division:

Arumuganeri P. O., Sahupuram-628202, Tamilnadu, India

Factory 3 : Salt Works :

Kuda Gujarat, India

Factory 4 : Arumuganeri P. O., Sahupuram-628202, Tamilnadu, India

DIRECTORS

AS ON 31.03.2010

Name : Mr. Shashi Chand Jain

Designation : Chairman and Managing Director

Name : Mr. Bakul Jain

Designation : Managing Director

Name : Mr. Pramod Kumar Jain

Designation : Managing Director

Name : Mr. F. H. Tapia

Designation : Director

Name : Dr. V. H. Joshi

Designation : Director

Name : Mr. Yuvaraj Saheb

Designation : Director
Name : Mr. Sushil Kumar Jalan
Designation : Director

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 4

Name : Mr. R. V. Ruia

Designation : Director

Name : Mrs. Vandana Jain

Designation : Executive Director

Name : Mr. Sushil Kumar Jalan

Designation : Director

KEY EXECUTIVES

Name : Mr. Chital V. Shah

Designation : Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 31.03.2011

Names of Shareholders No. of Percentage of

Shares Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family 2956760 15.07
Bodies Corporate 47316783 24.12
Sub Total 76878543 39.75
(2) Foreign
Total shareholding of Promoter and Promoter Group (A) 76878543 39.75
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI 27955 0.01
Financial Institutions / Banks 254585 0.13
Insurance Companies 8900110 4.60
Foreign Institutional Investors 25247677 13.06
Any Others (Specify) 42225 0.02
Foreign Bank 42225 0.02
Sub Total
(2) Non-Institutions
Bodies Corporate 10228899 5.29
Individuals
Individual shareholders holding nominal share capital up to Rs.0.100 54223348 28.04
million
Individual shareholders holding nominal share capital in excess of 8342463 4.31
Rs.0.100 million
Any Others (Specify) 9235035 4.78
Clearing Members 288716 0.15
Non Resident Indians 3126956 1.62
Overseas Corporate Bodies 5786013 2.99

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 5

Trusts 33350 0.02

Sub Total 82029745 42.42
Total Public shareholding (B) 116502297 60.25

(C) Shares held by Custodians and against which Depository Receipts 2773750 1.41
have been issued
Total (A)+(B)+(C) 196154590 100.00

BUSINESS DETAILS

Line of Business : Manufactures of Soda Ash, Caustic Soda, PVC Resins, Soda Bicarbonates,
Trichloroethylene, Synthetic Rutile, Titox, Utox, Bromine, Bromide and a Few
Other Chemicals.

Products : Products Description Item Code No

Poly Vinyl Chloride by Suspension 390042102
Caustic Soda 28151101
Soda Ash 28362009

PRODUCTION STATUS (31.03.2010)

Particulars Unit Licensed Installed Actual

Capacity Capacity Production
DHARANGADHRA UNIT:
Soda Ash MT 96000 96000 85740
Soda Bicarbonate MT 12000 12000 21047
Amonium Bicarbonate MT 5000 -- 722
Detergent - Green MT -- -- 12623
Detergent - Active MT -- -- 16863
SAHUPURAM UNIT:
Caustic Soda Lye MT 100000 100000 77612
Caustic Soda Solid MT -- -- 155
Caustic Soda Flakes MT -- -- 25910
Sodium Hypochlorine MT -- -- 4030
Hydrochloric Acid 100% MT 90000 66000 50156
Liquid Chlorine MT 36000 36000 18963
Trichloroethylene MT 7200 7200 4715
Upgraded llmenite MT 72000 48000 36384
Utox MT No Licence 600 1612
Required
Ferrie Chloride MT -- 10000 3005
Yellow Iron oxide MT -- -- 297
PVC Resin MT 90000 90000 85758
Caustic Soda Lye MT -- -- --
(Traded Goods)

NOTE

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 6

1. Licensed capacity is not applicable in view of the Company's products having been delicensed as per the new
liberalised licensing policy announced by the Government of India.

2. Ammonium Bicarbonate production is out of part of Soda ash plant

3. Self consumption quantity mentioned includes quantity lost in handling, lost in transit, was loss, samples, etc.

4. Previous year figures are given in bracket.

5. Lye sales quantity excludes 116 mt excess as per survey.

GENERAL INFORMATION

No. of Employees : 2283 (Approximately)

Bankers : • Punjab National Bank

• State Bank of India
• City Union Bank Limited
• ING Vysya Bank Limited

Facilities : Particulars As on As on
31.03.2010 31.03.2009
(Rs. In (Rs. In
Millions) Millions)
Secured Loans
Banks
Rupee Term loans 1581.039 1965.943
Foreign Currency Term Loan 897.998 1014.398
Short Term Loan - Bank -- 369.452
Working Capital Loans 136.306 240.518
Other Loans
Financial Institutions 512.312 585.500
Term Loans From NBFC 0.000 75.000

Total 3127.655 4250.811

NOTES

Loans Secured by

Banks- Working Capital facilities are secured by a first charge by way of

hypothecation and/or pledge of current assets, namely, stocks of materials, semi-
finished and finished goods, consumable stores and spares including machinery
spares not capitalized, bills receivable and book debts and further secured by a
second charge by way of hypothecation over all of movable plant and machinery
and by way of mortgage by deposit of title deeds over the immovable properties,
both present and future, such mortgage to rank second to the mortgages
created/to be created in favour of Term Loan Lenders viz., Banks/Financial
Institutions. Term Loans and External Commercial Barrowings from Banks are
secured by a pari-passu first charge by way of hypothecation of movable fixed

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 7

assets of the Company, including movable machinery spares, stores and further
secured by mortgage on all the immovable properties of the Company situated in
the states of Tamilnadu and Gujarat on first pari passu charge basis.

Other loans-Equipments Finance Loan from a Financial Institution and term loan
from NBFC are secured by creation of first pari-passu charge on all the movable
fixed assets, both present and future by way of hypothecation and further secured
by mortgage on all the immovable properties situated in the states of Tamilnadu
and Gujarat on first pari-passu charge basis.

Particulars As on As on
31.03.2010 31.03.2009
(Rs. In (Rs. In
Millions) Millions)
Unsecured Loans
Others
Deferred Sales Tax Credit 0.000 0.341

Total 0.000 0.341

NOTE

Due within one year Rs.0.341 millions (Previous Year Rs.0.134 millions)

Banking Relations : --

Auditors :
Name : V. Sankar Aiyar and Company
Chartered Accountant
Address : Mumbai, Maharashtra, India

Subsidiaries : DCW Pigments Limited

Associates : • Double Dot Finance Limited

• Crescent Finstock Limited
• Sahu Brothers Private Limited
• Dhrangadhra Trading Company Private Limited
• Kishco Limited
• Crescent Holdings Private Limited

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 8

CAPITAL STRUCTURE

AS ON 31.03.2010

Authorised Capital :
No. of Shares Type Value Amount

325000000 Equity Share Rs.2/- Each Rs.650.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares Type Value Amount

196154590 Equity Share Rs.2/- Each Rs.392.309 Millions

NOTES

Of the Equity Shares

1) The following Shares were allotted as fully paid-up without payment being received in cash:-

a) 5,25,000 Shares to Vendors

b) 4,550 Shares to Equity Shareholders of the erstwhile, PRC Limited, pursuant to the amalgamation with the
Company.

2) 3,74,50,985 Shares were allotted as fully paid up Bonus Shares by Capitalisation of Capital Redemption
Reserve, Share Premium Account and General Reserve.

3) 2,66,66,550 Shares were issued and allotted consequent to conversion of Part A of the 26,66,655 partly
convertible debentures allotted in April'1992.

4) 4,61,25,000 Shares were issued in 1994-95 against which Global Depository Receipts were issued by the
Depository viz.Citi Bank, USA.

5) 2,80,94,525 shares were issued and allotted pursuant to Rights issue made during 2000-01.

6) 2,36,10,000 Shares were issued and allotted on preferential basis to the Promoters of the Company and FM's
during 2007-08.

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 9

FINANCIAL DATA
[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS 31.03.2010 31.03.2009 31.03.2008

SHAREHOLDERS FUNDS
1] Share Capital 392.309 392.309 392.309
2] Share Application Money 0.000 0.000 0.000
3] Reserves & Surplus 3354.480 2763.723 2691.789
4] (Accumulated Losses) 0.000 0.000 0.000
NETWORTH 3746.789 3156.032 3084.098
LOAN FUNDS
1] Secured Loans 3127.655 4250.811 3773.513
2] Unsecured Loans 0.000 0.341 0.492
TOTAL BORROWING 3127.655 4251.152 3774.005
DEFERRED TAX LIABILITIES 834.490 786.990 734.490

TOTAL 7708.934 8194.174 7592.593

APPLICATION OF FUNDS

FIXED ASSETS [Net Block] 6421.142 6894.890 5596.223

Capital work-in-progress 898.000 661.280 1510.004
Machinery/ Spares for erection and replacement 0.000 3.741 6.348

INVESTMENT 8.115 3.234 127.827

DEFERREX TAX ASSETS 0.000 0.000 0.000

CURRENT ASSETS, LOANS & ADVANCES

Inventories 1499.940 1184.783 1246.674
Sundry Debtors 1017.260 972.498 666.071
Cash & Bank Balances 17.451 15.808 47.464
Other Current Assets 0.000 0.000 0.000
Loans & Advances 571.220 539.004 633.370
Total Current Assets 3105.871 2712.093 2593.579
Less : CURRENT LIABILITIES & PROVISIONS
Sundry Creditors 831.258 716.413 380.658
Other Current Liabilities 1719.094 1203.343 1703.368
Provisions 173.844 161.308 157.362
Total Current Liabilities 2724.196 2081.064 2241.388
Net Current Assets 381.677 631.029 352.191

MISCELLANEOUS EXPENSES 0.000 0.000 0.000

TOTAL 7708.934 8194.174 7592.593

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 10

PROFIT & LOSS ACCOUNT

PARTICULARS 31.03.2010 31.03.2009 31.03.2008

SALES
Income 10268.031 9070.320 7479.034
Other Income 23.402 302.544 41.185
TOTAL (A) 10291.433 9372.864 7520.219

Less EXPENSES
Manufacturing and Other Expenses 8470.524 8489.375 6575.800
TOTAL (B) 8470.524 8489.375 6575.800

Less PROFIT BEFORE INTEREST, TAX, 1820.909 883.489 944.419

DEPRECIATION AND AMORTISATION (A-B) (C)

Less FINANCIAL EXPENSES (D) 387.009 270.978 134.834

PROFIT BEFORE TAX, DEPRECIATION AND 1433.900 612.511 809.585

AMORTISATION (C-D) (E)

Less/ DEPRECIATION/ AMORTISATION (F) 489.271 412.328 300.285

Add

PROFIT BEFORE TAX (E-F) (G) 944.629 200.183 509.300

Less TAX (H) 268.325 57.722 151.373

PROFIT AFTER TAX (G-H) (I) 676.304 142.461 357.927

Add PREVIOUS YEARS’ BALANCE BROUGHT 206.746 333.131 244.053

FORWARD

Less APPROPRIATIONS
Transfer to General Reserve 400.000 200.000 200.000
Proposed Dividend on Equity 70.616 58.846 58.845
Shares
Tax on Dividend 12.001 10.001 10.000
BALANCE CARRIED TO THE B/S 482.617 206.745 333.131

EARNINGS IN FOREIGN CURRENCY

Export Earnings 943.703 1001.859 890.317
Other Earnings 1.330 1.573 1.282
TOTAL EARNINGS 945.033 1003.432 891.599

IMPORTS
Raw Materials 4409.018 3746.829 3038.541
Stores & Spares 42.738 15.512 24.834
Capital Goods 15.283 3.331 155.050

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 11

TOTAL IMPORTS 4467.039 3765.672 3218.425

Earnings Per Share (Rs.) 3.45 0.73 1.82

QUARTERLY / SUMMARISED RESULTS

PARTICULARS 30.06.2010 30.09.2010 31.12.2010 31.03.2011

st nd rd th
Type 1 Quarter 2 Quarter 3 Quarter 4 Quarter
Sales Turnover 2296.440 2835.700 2535.670 2957.630
Total Expenditure 2056.050 2557.820 2288.070 2740.570
PBIDT (Excl OI) 240.390 277.880 247.600 217.060
Other Income 1.990 1.390 0.600 (0.810)
Operating Profit 242.380 279.280 248.200 216.250
Interest 74.260 67.390 73.400 70.670
Exceptional Items 86.690 55.370 (15.480) 7.490
PBDT 254.810 267.250 159.330 153.070
Depreciation 117.530 114.980 121.350 121.720
Profit Before Tax 137.280 152.280 37.980 31.360
Tax 25.000 37.500 7.500 (0.220)
Reported PAT 112.280 114.780 30.480 31.580
Extraordinary Items 0.000 0.000 0.000 0.000
Prior Period Expenses 0.000 0.000 0.000 0.000
Other Adjustments 0.000 0.000 0.000 0.000
Net Profit 112.280 114.780 30.480 31.500

KEY RATIOS

PARTICULARS 31.03.2010 31.03.2009 31.03.2008

PAT / Total Income (%) 6.57 1.52 4.76

Net Profit Margin (%) 9.19 2.21 6.81

(PBT/Sales)

Return on Total Assets (%) 9.91 2.08 6.22

(PBT/Total Assets}

Return on Investment (ROI) 0.25 0.06 0.17

(PBT/Networth)

Debt Equity Ratio 1.56 2.01 1.95

(Total Liability/Networth)

Current Ratio 1.14 1.30 1.16

(Current Asset/Current Liability)

LOCAL AGENCY FURTHER INFORMATION

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 12

HISTORY

Incorporated in 1939, subject was taken over by the present promoters under the late Sahu Shriyans Prasad Jain.
The company manufactures soda ash, caustic soda, PVC resins, soda bicarbonates, trichloroethylene, synthetic
rutile, titox, utox, bromine, bromide and a few other chemicals. The company has also introduced a range of home
products like packaged spices, flour and iodised salt. The Company is one of the six major producers of PVC and
accounts nearly 10% of total market share in India. In Caustic Soda it is having 15% market share in South India.
In Apr.'93, Pantape Magnetics was amalgamated with the company. It came out with a rights issue and a GDR
issue in 1994, to install 30-MW power plant and expand the PVC plant by increasing the capacity from 42,000 tpa
to 60,000 tpa. The expansion of the PVC plant was completed in 1994-95. It entered into an agreement with Lego
Overseas, Denmark, to market their educational toys in India.

The project to set up a 30-MW captive power plant at its factory in Sahupuram, is under implementation. In 1995-
96, four out of 5 generators of 6 MW each were commissioned. In 1996-97, it proposes to set up a facility for
recovering Ferrite Grade Iron Oxide from the effluent of the beneficiated ilmenite plant, In the process
Hydrochloric Acid of the required concentration will be regenerated for use in the beneficiated ilmenite plant. It
has entered into technical collaboration with International Steel Services Inc, USA. who have lot of experience in
the manufacture of this product but the project is kept on hold as the plant with similar technology supplied to
another Indian company is yet to be satisfactorily commissioned.

A Scheme of Arrangement between the Company and Crescent Fin stock Private Limited was approved by the
shareholders at the Court convened meeting held on 4th August, 1997. CFPL has been converted into a Public
Limited Company and steps are being initiated to issue Equity Shares of Crescent Fin stock Limited to the
shareholders of the Company in the ratio of 1:4 as per the Scheme already approved. The performance of Soda
Ash Division during the year 2001 was very low due to high labour strength and excess supply position is a major
cause of concern since it adversely affects other divisions in general and the company in particular. De-
bottlenecking of Beneficiated Illmenite, Caustic Soda and pvc plants project was taken up by the company at a
cost of Rs.330.000 Millions and this has been sanctioned by IDBI.

The subsidiary company has been amalgamated with the subject from 1st April, 2000. The Company is in the
process of replacing 33 old Carbonators with 3 Carbonation towers which is expected to be completed by August
2004. This will increase the production of Soda Ash by 7000 MT per annum and also the Company has increased
the production of detergent to 8000 tonnes.

OPERATIONS

Sales during the year were Rs. 10957.600 millions as compared to Rs. 10119.300 millions recorded in the
previous year, registering an increase of 8%. The Gross Profit for the year(before depreciation) is Rs.143.39
millions against Rs. 612.500 millions in previous year. The profit before tax amounted to Rs. 944.600 millions as
against Rs. 200.200 millions in the previous year. After providing Rs. 2200.800 millions for current taxes, the
profit before deferred tax is Rs.723.800 millions , as against Rs. 195.000 millions . The profit after provision of
deferred tax is Rs. 676.300 millions against previous year's Rs. 142.500 millions registering an increase of
372%. Deferred Tax is only a provision as per accounting guidelines and is not an outflow.

The Company achieved record profits during the financial year on account of improved workings of all Divisions of
the company as compared to previous year during which the working of the company suffered due to global slow
down.

EXPORTS

The Company's exports were Rs.969.200 millions as compared to Rs. 1021.200 millions in the previous year.
The 5% decrease in exports was on account of lower export of Beneficiated laminate coupled with lower price

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 13

realization due to global recession in the user industries. However the prices of the product have since improved
and the Company is hopeful of achieving increased exports in the current year.

DIVISIONWISE PERFORMANCE

a) PVC Division:
The turnover of the division was Rs. 4566.600 millions as compared to Rs. 4901.500 millions , registering a
decrease of 7%. This decrease in sales was due to decrease in quantity sold of PVC compared to previous year.
The company sold 85311 MT of PVC resin compared to 90656 MT in the previous year. The sales during
previous year has been higher due to higher opening carryover stocks which were sold in the previous year. All
major user segments are recording good demand and PVC industry continues to show positive growth. The
Government has identified irrigation, power and infrastructure as thrust areas and increased activity in these
sectors are likely to boost demand of PVC Resin

b) Caustic Soda Division:

The turnover of the division was Rs. 4388.400 millions as compared to Rs. 3058.000 millions in the previous
year, registering an increase of 44% in the sales. This increase in turnover was due to better price realization on
Caustic Soda and also due to sale of surplus power generated in the Company's Captive Power Plants at
Sahupuram in Tamilnadu. The Company sold 75611 MT of Caustic Soda during the year as compared to 77807
MT in the previous year..

c) Soda Ash Division:

The turnover of the division was Rs. 1928.700 millions as compared to Rs. 209.38 millions in the previous year
registering a decrease of 8%. The decrease in turnover is mainly due to lower realization on Soda Ash and Soda
Bicarbonate compared to previous year. The Company sold 80186 MT of Soda Ash, 23741 MT of Soda
Bicarbonate and 29721 MT of Detergent during the year as compared to 65426 MT of Soda Ash, 1 7542 MT of
Soda Bicarbonate and 39222 MT of Detergent, in the previous year.

PROJECTS IMPLEMENTED AND UNDER IMPLEMENTATION

1. Additional 8.27 MW Turbine In Thermal Power Plant

The Company has successfully completed and commissioned its Captive Thermal Co-generation Power Plant for
generating 50MW of power and 85 TPH steam during previous year at Sahupuram unit in Tamilnadu. This
Thermal Co-Generation Power plant has been established keeping in view of future expansion plans of the
Company. The Power and Steam at present generated by this Thermal Co- Generation Power Plant is not totally
consumed Captivity and excess power is sold to TNEB and Third Parties in the State of Tamil Nadu. The
additional Steam generated will however, be consumed only after the company starts its future projects. Keeping
this in view and to run the Thermal Co-Generation Power Plant to its full capacity, Company is establishing an
Injection Turbine to generate additional Power to the extent of 8.27 MW from the excess Steam available in this.
Thermal Co-generation Power Plant, which can be sold to third parties. This turbine will be commissioned by end
May, 2010 and will help in reducing the cost of energy thus improving the bottom line.

2. Solway Towers at Dhrangadhra Unit

Solway towers installed at the Soda Ash Unit are still to be commissioned. An assignment has been given to Akzo
Noble, Neatherlands, to do basic engineering to utilize the towers to its optimum efficiency and thereby to
increase Soda Ash Production. Akzo Noble has already submitted Basic Engineering report and detailed
Engineering is under final stages of preparation and the modification necessary for utilizing this towers to its
optimum efficiency and the commissioning of the towers is expected to commence soon

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3. Calcium Chloride Plant

The Calcium Chloride project at Company's Soda Ash unit has also been assessed by Akzo Noble, Netherlands
and they have suggested improvements in the unit to make it commercially operational. The company has
completed detailed Engineering work as per the Basic Engineering package submitted by Akzo Noble,
Netherlands. Orders have already been placed for necessary additional equipments required for carrying out the
modifications for this project and it is expected to commence commercial production by fourth quarter of 2010-11

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

OUTLOOK:

The Company has a diversified operation with three business segments viz. PVC, Chloro Alkali and Soda Ash. It
is thus reasonably protected from the vagaries of individual business cycles of these products.

PVC Division

The Company, one of the country's five producers of the PVC resin, has maintained its market share of nearly
10%. Against demand of 17.500 Million Tons, the domestic production capacity is12.500 Million Tons thereby
leaving shortfall of over 5.000 Million Tons of which is met by imports. Also PVC demand is growing at a CAGR of
above 10%, with increased government spending towards infrastructure, agriculture and water management. The
Company is exploring the possibility of increasing PVC Production, to cater to this demand supply gap.

Caustic Soda Division:

The Company continues to be a major player in South India with a market share of approximately 15%. The
demand for caustic soda. is expected to grow at a steady rate of 4% to 5% over the next 3 years, specially with
increased demand from alumina manufacturers. Due to international downtrend in caustic soda demand there is
pressure on realization. The company is able to fully use its HCL and Chlorine to maintain Caustic Production at
reasonable level. There is sustainable demand for Caustic and Chlorine and the situation is expected to improve
during the year.

The conversion from Mercury Cell to Membrane Cell technology has not only resulted in substantial capacity
addition but also has brought down the consumption of power which has helped in improving the bottom-line.
Soda Ash Division: The Soda Ash Industry continues to grow at a compounded rate of 4% to 5% per annum and
this trend is expected to continue due to strong demand from end user industries with better sales realization.
Plans are being made to marginally increase Soda Ash production by utilizing the Solway Towers and installation
of other equipments like Co2 compressors. Sale of Surplus Power: The Company's Captive Thermal Co-
Generation Plant established as part of its Caustic Soda Division has gone on stream in previous year. This
power plant has been established to meet company's present and future energy requirements keeping in view of
the company's future expansion plans. This Thermal Co-generation plant at present has additional un-utilised
capacity. With the demand of power going up due to power shortfall in the country, the company has started
selling this excess power to Tamil Nadu Electricity Board and also to third parties in the State of Tamil Nadu.
Selling this excess power available from its Thermal Co- Generation Power Plant till it starts utilizing total power
generated from the power plant, captively, will augment the company's bottom line

Proposed Projects:

Iron Oxide Pigment The company with the technical know-how developed by its in house R & D Department has
established Pilot Plant for Manufacturing Yellow Iron Oxide Pigment from the waste generated in its Synthetic
Rutile Plant. Your company has commercialized this product and is at present manufacturing about 500 TPA of

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Iron Oxide Pigment from the Pilot Plant, which is being sold in local as well as international market and the
product has been well accepted. Company is working to establish a Iron Oxide Pigment Plant. With establishment
of this project the Company will be generating a value added product from waste and it will be reducing cost of
neutralising the waste generated from its Synthetic Rutile Plant thereby improving its bottom line.

CONTINGENT LIABILITIES NOT PROVIDED FOR

(Rs. In Millions)
A. CONTINGENT LIABILITIES NOT PROVIDED FOR: As at 31.03.2009
1. Disputed Sales Tax Demands 110.401
2. Disputed Excise Demands 29.725
3. Disputed Customs Demands 3.126
4. Disputed Income Tax Demand (A. Y. 2005-06 and 2006-07) 27.002
5. Company's contribution to ESI not made pursuant to petitions for exemption 8.604
pending before ESI Court
6. Lease Rent, Local Cess, Interest on Lime Stone, Surcharge, Stamp Duty, Octroi 223.724
and Water and Electricity charges
7. Disputed Industrial relations matters 35.978
TOTAL 438.560
B. GUARANTEE AS A MEMBER OF THE ALKALI MFRS. ASSN.
(A Company Limited by Guarantee) 0.001
st
AUDITED FINANCIAL RESULTS FOR THE YEAR ENDED MARCH 31 , 2011

(Rs. In millions)
Particulars Quarter Accounting
Ended Year Ended
31.03.2011 31.03.2011
Audited Audited
1. Net Sales /Income from Operations 2939.364 10576.543
2. Other Operating Income 18.270 48.905
Total Income 2957.634 10625.448
3. Total Expenditure :
a) (Increase)/decrease in Stock in Trade and Work in Progress 267.987 56.209
b) Consumption of Raw Materials 1777.613 7028.498
c) Purchase of Traded Goods 0.000 9.384
d) Power and Fuel 212.402 870.758
e) Staff Cost 98.841 498.913
f) Depreciation 121.722 475.578
g) Other Expenditure 383.725 1178.744
Total 2862.290 10118.084
4. Profit from Operations before Other Income, Interest and Exceptional Items 95.344 507.364
5. Other Income (0.810) (3.171)
6. Profit before Interest and Exceptional Items 94.534 510.535
7. Interest (Net) 70.667 285.712
8. Exceptional Items 7.490 134.065
9. Profit from Ordinary Activities before tax 31.357 69.782
10. Tax expense
- Current Tax
-Fringe Benefit Tax 0.000 0.000

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-MAT Credit Available 0.000 0.000

-Tax Adjustment of Previous Year 0.000 0.000

11. Profit from Ordinary Activities after current tax 31.357 358.888
Deferred Tax (0.218) (69.782)
Extraordinary Items -- --
12. Net Profit / (Loss) 31.575 289.106
13. Paid-up equity capital (Face Value - Re.2/- each) 392.309 392.309
14. Reserves excluding Revaluation Reserve as per balance sheet of previous
accounting year
15. Earnings Per Share (EPS)
(a) Basic and Diluted EPS before extraordinary items 0.16 1.47
(b) Basic and Diluted EPS after extraordinary items 0.16 1.47
16. Public shareholding
- Number of shares 119276047 119276047
- Percentage of Shareholding 60.81% 60.81%
17. Promoters and promoter group Shareholding :
a) Pledged/Encumbered
- Number of shares Nil Nil
-Percentage of shares (as a % of the total shareholding of promoter and Nil Nil
promoter group)
-Percentage of shares (as a % of the total share capital of the company) Nil Nil
b) Non-encumbered
- Number of Shares 76878543 76878543
-Percentage of shares (as a % of the total shareholding of promoter and 100% 100%
promoter group)
- Percentage of shares (as a % of the total share capital of the company) 39.19% 39.19%

SEGMENT REVENUE, RESULTS AND CAPITAL EMPLOYED

(Rs. In millions)
Particulars Quarter Accounting
Ended Year Ended
31.03.2011 31.03.2011
(Audited) (Audited)
I) Segment Revenue: (Net Income)
a. Soda Ash 461.101 1685.071
b. Caustic Soda 1263.821 4199.253
c. PVC 1212.448 4682.335
d. Others 1.994 9.884
Net Sales from operation 2939.364 10576.543
ii. Segment Results: (Profit before Interest and Tax)
a. Soda Ash 61.703 137.891
b. Caustic Soda 43.784 248.150
c. PVC (11.810) 114.430
d. Others 0.587 10.064
Total: 94.534 510.535
Less: Interest 70.667 285.712
Exceptional Items 7.490 134.065
TOTAL PROFIT BEFORE TAX 31.357 358.888

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iii. Capital Employed (Segment assets -Segment Liabilities)

a. SodaAsh 1506.950 1506.950
b. Caustic Soda 5868.016 5868.016
c. PVC (819.841) (819.841)
d. Others 1553.816 1553.816
Total: 8108.941 8108.942

STATEMENT OF ASSETS AND LIABILITIES-AUDITED

Particulars Year Ended

31.03.2011
1. Shareholders' Funds
a. Capital 392.309
b. Reserve and Surplus 364.102
Loan Funds 3307.338
Deferred Tax Liability (Net) 768.272
Total 8108.941

Fixed Assets 7849.510

Investments 3.239
Current Assets, Loans and Advances
a. Inventories 1272.561
b. Sundry Debtors 1046.967
c. Cash and Bank Balances 19.360
d. Loans and Advances 747.512
3086.400
Less: Current Liabilities and Provisions
a. Liabilities 2746.493
b. Provisions 83.715

Net current Assets 256.192

Total 8108.941

NOTE

1. The audited results for the year ended 31.03.2011 were reviewed by the audit committee and approved
by the board of directors at their meeting held on 16.05.11
2. board has recommended 18% i.e. Rs.0.36 per equity share as divided for the financial year ended
31.03.2011
3. The guidance on implementing AS15, employee benefits (Revised 2005) issued by the accounting
standards board (ASB) states that provident funds set up by the employers, which require interest
shortfall to be met by the employer, are defined benefit plans. Having regard to the assets of the fund and
thee return on investments the company does not expect any deficiency in the foreseeable future.
4. Previous periods figures have been regrouped/rearranged wherever necessary
5. Exception item includes profit on sale of Wondmills Rs. 110.081 millions.
6. Not investor complaints were pending at the beginning of the quarter, 9 complaints were received during
the quarter and all were resolved before end of the quarter.

FIXED ASSETS

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 18

• Land
• Building
• Plant and Machinery
• Furniture and Fittings
• Vehicles

AS PER WEBSITE DETAILS

PROFILE

Subject is a diversified manufacturer of basic chemicals, such as:

• Caustic Soda
• Liquid Chlorine and Chlorine based products such as Trichloroethylene and HCL
• Upgraded Ilmenite or Synthetic Rutile
• Yellow Iron Oxide
• PVC Resin
• Soda Ash
• Ammonium bi-carbonate
• Liquid Bromine and Bromide.

Subject is an industry pioneer with a long track record in its markets and has a successful record in developing
downstream and related products.

Its competitive position is enhanced by the diversity of its products.

Subject has focused on development of value-added and export-oriented products like Upgraded Ilmenite and
Pigment grade Yellow Iron Oxide.

Subject has embarked on an ambitious project for the manufacture of Ferrite Grade Iron Oxide with a capital
expenditure of around Rs.1 billion.

THE BEGINNINGS

The subject story goes back to 1925 when the foundation stone of India's first Soda Ash factory at Dhrangadhra --
a small principality in Gujarat in West India -- was laid. The plant was taken over in 1939 and run under the name
Dhrangadhra Chemical Works. To wish the venture luck, the company adopted the horse shoe as their corporate
logo, which stands till today, and is widely recognised as a symbol of excellence.

It is said that every oak begins as an acorn. The process of growth received a major impetus in 1959 with the
commissioning of the chlor-alkali plant at Sahupuram in the southern state of Tamilnadu. At that time, the area
was completely barren. Today this complex has made its mark on the chemical map of India as well as the world.

Growth at the chlor-alkali complex was rapid as between 1965 and 1970 three plants were erected that turned the
co-product chlorine into a money spinner; a liquid chlorine plant in 1965, the country's first tri-chloroethylene plant
(left) in 1968 and an integrated PVC resin plant in 1970-making the company one of the first in the nascent
petrochemicals field.

In the same year, 1970, the company set up a plant to manufacture upgraded ilmenite, the first of its kind in Asia,
and even today, one of the few of its kind in the world. In 1986, to reflect the expanded activity spectrum, and its
emergence as a multi-product and multi-locational company, the corporate name was changed simply to subject.

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Subject has certainly come a long way since its small beginnings and is one of India's soundest and most
respected chemical companies.

THE DIFFERENT DIVISIONS

THE SODA ASH DIVISION

Subject pioneered the manufacture of Soda Ash in India. The original capacity of 60 tonnes per day has been
increased in stages to the present day capacity of 300 TPD and new products have been added to bring diversity
to the product portfolio.

A major modernisation programme, aimed at energy conservation was completed in 1993. Based on the "total
energy utilisation" concept, the energy consumption per tonne of soda ash was reduced from 6.59 million K Cal to
3.55 million K Cal - almost half. There has been a total revamp of plant and machinery that has improved
operating efficiency.

The product range of the Soda Ash division now reads an impressive 96,000 TPA of Soda Ash, Ammonium
Bicarbonate 5000 TPA, Soda Bicarbonate 12,000 TPA, Liquid Bromine 300 TPA; Isopropyl Bromide 120 TPA;
Ethyl Bromide 40 TPA; Butyl Bromide 8 TPA. Calcium Chloride is also produced but its production is seasonal.
Salt, the major raw material is produced at the company's own salt works - just 22 kms away.

The products of this division cater to a wide range of end user industries such as detergents, sodium silicate, dye
intermediates, brine purification, ore refining, bakeries, cooling agents, pesticides, drug intermediaries, paper,
chemicals, glass etc.

Subject has a range of loyal customers including blue chip names such as Hindustan Lever, Atul Products,
Gujarat Alkalies, Grasim Industries etc.

THE CAUSTIC SODA DIVISION

Subject commissioned a plant for the production of Caustic Soda in 1959. The output of Caustic Soda has been
increased in stages from 28,000 TPA to 80,000 TPA, making subject one of the leading producers of this basic
chemical in India. Modernisation has been an ongoing activity to improve productivity and efficiencies in the
electrolysis of Caustic Soda, Replacement of old equipment and installation of continuous salt saturators have
resulted in substantial energy savings.

The by-product, chlorine, is fully used to add value in-house. With increasing demand for liquid chlorine, the plant
capacity has been increased from 60 TPD to 80 TPD. Process improvement, in terms of medium pressure
liquefaction has will resulted in more productivity, less consumption of electrical energy and refrigerant.

With a capacity of 5,400 TPA, Company was India's first producer of tri-chloroethylene, an important degreasing
agent. Company is one of only few who make this solvent in India, and has exported this commodity as well. The
Hydrochloric Acid plant capacity has been increased to 46,000 TPA with new graphite furnaces and company has
been one of the first to export this product.

SYNTHETIC RUTILE

High on the list of significant landmarks in company’s history was the implementation of the project to
manufacture upgraded ilmenite, also known as synthetic rutile, for the first time in Asia in 1970. The raw material,
ilmenite ore, found in the black sands of Tamil Nadu and Kerala, is chemically upgraded to form synthetic rutile of
over 95% Titanium dioxide content and is used as an alternative to natural rutile required for manufacture of

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Titanium dioxide and Titanium metal. The Plant was commissioned with almost entirely indigenous know-how and
is presently one of the few of its kind in the world. The present capacity is 20,000 TPA.

Besides being one of the highest purity synthetic rutiles in the market, Company’s product also has very low
levels of radioactive content, making it a top quality material. Company has consistently exported synthetic rutile
to the USA, Japan and other demanding markets.

Subject has also developed in-house, a new special "weld grade" synthetic rutile which caters to the requirements
of welding and electrode manufacturers by being a substitute for natural rutile. Also through in-house R and D and
constant experimentation, a superior product called "UTOX" was developed as a partial substitute for white
pigment. The product is manufactured with stringent production and quality controls to ensure consistent particle
size and colour. The product finds application in the paint, plastic and rubber industries in India and abroad.

FERRITE GRADE IRON OXIDE

Subject is now installing a facility for the manufacture of Ferrite grade Iron Oxide from the effluent of ilmenite
plant. The quality of the Iron Oxide will enable it to be used in the manufacture of Soft Ferrites which have wide
applications in the Electronic Industry. The technology employed is the Solvent extraction process, which ensures
a high level of purity of the final product.

SYNTHETIC YELLOW IRON OXIDE

It is manufactured by the precipitation process using leach liquor - a waste from the Ilmenite plant. The quality of
the product matches international standards. It finds application in cement paints, Stainers, Paper, Industrial
enamels and construction material.

THE PVC RESIN DIVISION

Petrochemicals have been the new buzzword of Indian industry in recent years. In 1970, company became one of
the first in India to enter this growing field by setting up a PVC resin plant at Sahupuram in Tamil Nadu in
Southern India.

Subject was the first, and is currently the only Indian producer to handle and store imported VCM, a volatile gas. It
successfully erected a total storage capacity of 5,600 MT at Tuticorin port (a distance of 30 km from the plant) -
including a huge 5000 M3 sphere. This installation is one of the few of its kind in South East Asia and gives the
company a competitive edge in meeting its import requirements.

Constant in-house R and D with modifications in process recipes, resulted in continuous increase in production
with very little additional investment. The production crossed 20,000 TPA in 1985-86 after a technical tie up with
Atochem, France which also assisted DCW in improving efficiency.

With installation of stainless steel reactors, a new energy efficient fluid bed dryer and state of the art vapour
absorption refrigeration, the production capacity has now reached 60,000 TPA.

An important spin off has been the improvement in product quality, production of food grade PVC, and significant
consumption efficiencies, comparable with the best in the world.

PVC Resin is a thrust area for company. Having established its excellence in polymer manufacture and
marketing, company is making efforts to develop new PVC applications. PVC is already the most widely used
thermoplastic in India, with a growth rate of over 15%. It finds application in rigid pipes, heavy power cables,
footwear, luggage, bottles, flooring and sidings, window profiles, automotive parts, etc.

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 22

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 records 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.

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 23

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.56.53
UK Pound 1 Rs.88.09
Euro 1 Rs.70.83

INFORMATION DETAILS

Report Prepared by : SDA

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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 24

SCORE & RATING EXPLANATIONS

SCORE FACTORS RANGE POINTS

HISTORY 1~10 8
PAID-UP CAPITAL 1~10 8
OPERATING SCALE 1~10 8
FINANCIAL CONDITION
--BUSINESS SCALE 1~10 8
--PROFITABILIRY 1~10 8
--LIQUIDITY 1~10 8
--LEVERAGE 1~10 7
--RESERVES 1~10 8
--CREDIT LINES 1~10 7
--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 YES
--OTHER MERIT FACTORS YES/NO YES
TOTAL 70

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%)

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.
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INDIA@DCW_LIMITED_-_185370_-_PRELIMINARY_REPORT_26-JUN-2012 PAGE NO. : 25

RATING EXPLANATIONS

RATING STATUS PROPOSED

CREDIT LINE
>86 Aaa Possesses an extremely sound financial base with the strongest Unlimited
capability for timely payment of interest and principal sums
71-85 Aa Possesses adequate working capital. No caution needed for credit Large
transaction. It has above average (strong) capability for payment of
interest and principal sums
56-70 A Financial & operational base are regarded healthy. General unfavourable Fairly Large
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums
41-55 Ba Overall operation is considered normal. Capable to meet normal Satisfactory
commitments.
26-40 B Capability to overcome financial difficulties seems comparatively below Small
average.
11-25 Ca Adverse factors are apparent. Repayment of interest and principal sums Limited with full
in default or expected to be in default upon maturity 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.

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.
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