Shri Ambica Proposal SBI

DATE CHARTPROPOSAL FOR CREDIT FACILITIES

NAME OF THE UNIT SHRI AMBICA INTERNATIONAL FOOD COMPANY PVT. LTD.

BRANCH TARAORISEGMENT SSI

(` in crores)

Nature of Facilities Existing* Proposed*Others SBI Total Others SBI Total

Fund Based 35.62 32.80 68.42 32.12 49.30 81.42Non Fund Based (1.50) (3.50) (5.00) (1.50) (3.50) (5.00)Total 35.62 32.80 68.42 32.12 49.30 81.42 *part in consortium & part on stand alone basis

Centralized Processing Cell (CPC)a. Date of receipt of the proposal at the CPC 29.01.11b. Date on which additional information/gaps were advised to the Branch for recasting the proposal/ providing the information.

31.01.11

c. Date of receipt of the amended proposal/ Information at CPC 15.03.11d. Date of putting up the proposal to CRA Validation Committee 15.03.11e. Date of validation by CRA Validation Committeee. Date of putting up proposal to CCC-I 15.03.11f. Date of query by CCC-I, if any g. Date of resubmission to CCC-Ih. Date of sanction by CCC-I

CIS Codes:PARTICULARS CODE PARTICULARS CODE 1. SEGMENT 5. FACILITYSSI SG 1 CASH CREDIT FC 1

TERM LOAN FC 32. ACTIVITY 6. SUB-FACILITYMfg. Of grain product (rice)

AC 15301 a) STOCKS & BOOK DEBTS

FA 116

b) TERM LOAN FA 300c) EPC FA 120

3. CONSTITUIONPvt. Ltd. Co. OR 32

7. SANCTIONING AUTHORITY

4. SCHEME- Others FS 1000 CCC-I SA 35

Credit Analyst (CPC) Team Leader (CPC)

(Pankaj Sood) (A. K. Raina)

CPC, A.O. HARYANA SHRI AMBICA INTL. FOOD CO. PVT. LTD. TARAORI 1

AGENDA ITEM FOR THE CIRCLE CREDIT COMMITTEE-I

S FORMAT: Section A EXECUTIVE SUMMARY CIRCLE/SBU: CHANDIGARHBRANCH: TARAORICOMPANY: SHRI AMBICA INTL. FOOD CO. PVT. LTD.Section Contents Pages1 Borrower profile

a. Name, Address, Manufacturing activity/Locations, Date of incorporation, Banking arrangement etc 3

b. Brief Background (Firm/ Group/ Promoters/ Management including shareholding pattern) 3

c. Brief write up on Industry/Sector and Firm’s standing 5

d. RMD Advisory/qualitative approach/Quantitative approach/Comments 6

e. Indebtedness/Exposure & capital charge 6

2 Present Proposala. Proposal: For sanction/approval/confirmation 7b. Credit limits (existing and proposed) 8c. Sharing pattern 8

3 Performance Detailsa. Performance and Financial indicators 9b. Industry exposure 9c. Movement in TNW 11

d. Synopsis of balance sheet 124 Risk assessment:

a. Credit Rating b. Rating by External Agencies 13c. Risk and mitigating factors 13d. Warning signals/Major irregularities in Inspection

Audit/Credit Audit/Other Reports 14e. Security 14

f. Changes in Security if any, justification 145 Pricing

a. Conduct of account 15b. Income analysis 15c. Other Bank’s/FIs pricing 15

d. Proposed pricing 166 Loan Policy: Deviations & Compliance:

a. Whether names of promoters, directors, firm, group concern figure in defaulters/willful defaulters list 18

b. Deviation in Loan policy 18c. Deviation in Take over norms and comments 19d. Directors of Borrowers firm: status of relation with: Board, Sr. officials of the bank etc 21e. Compliance with Sec 20 of the Banking Reg Act 21f. Other Issues 21

7 a. Future plans & Business Potential including cross selling/retail marketing 23

b. Environmental and sustainability implications 23c. Earlier terms of Sanction: Compliance status 23

d. Statutory dues /Contingent Liabilities 23

8 a. Justification for the Proposal & b. Recommendations: 24


SECTION 1

Circle/SBU: Chandigarh Branch: Taraori Borrower’s Profile:a. Name, Address, Manufacturing activity/Locations, Date of incorporation, Banking arrangement etc of Company: Shri Ambica International Food Co. Pvt. Ltd.CEO: Sh. Ishwar Chand Goel and Sh. Subhash Chand GoelRegd. Office: Nadana Road, Taraori, Karnal (Haryana)Mfg facility (Locations): 3949-B, Naya Bazar, New DelhiSegment: SSI Constitution:

Pvt. Ltd. Co.IRAC Status:Advances: Standard Asset as on 31.12.10Investments: NA

Industry: Food Processing (Rice) Activity: Rice Millers and ExportersDate of incorporation: 15.11.2006 Banking with us since: 23.10.2008Banking arrangement: part credit facilities in Consortium (with Canara Bank)Existing Connection: Yes.If yes, date of sanction of existing limits: 29.09.10 by CCC-II.

New unit: No

If Take over: NoWhether all norms complied with: NA

b) Brief Background (Firm/ Group/ Promoters/ Management including shareholding pattern):

The unit is engaged in the business of rice milling and exports since 1983 and previously operated as M/s Ambica Rice Mills, a proprietorship firm of Sh. Ishwar Chand Goel. On 15.11.2006, Sh. Goel incorporated Ambica Agrico Exports Pvt. Ltd. alongwith his son Sh. Subash Chand Goel, which took over existing running business/ assets /liabilities and client base of the firm M/s Ambica Rice Mills w.e.f. FY09. Subsequently, the company changed its name to Shri Ambica International Food Company Pvt. Ltd. w.e.f. 01.04.10 because of astrological reasons (approval for name change was accorded by CCC-II on 23.06.10).

After taking over of the business of the firm M/s Ambica Rice Mills, the company invested in advancement of technology and set up a completely integrated and imported rice milling unit along with sortex machines supplied by reputed suppliers (M/s Satake International). The project was funded by term loans of Rs. 15.00 crores from Canara Bank in 2008 & 2009. After implementation of the project, the company’s milling capacity expanded to 8 MT per hour and sorting/grading capacity to 6 MT per hour.

Subsequently, the company envisaged another project involving further expansion of sorting capacity by 12 MT per hour, and the same was funded by a term loan of Rs. 5.00 crores from our Bank (sanctioned in September 2010).

The company’s main customer base is in the Middle Eastern countries with over 90% sales to Saudi Arabia and remaining to other Gulf and European countries.

The company’s management is owner-driven, traditionally true for all rice milling units, but manages its affairs efficiently. The following directors are on board of the company:

Name Age Qualification Experience Share-holding1. Sh. Ishwar Chand Goel 69 Matric 40 years 66.25%2. Sh. Subhash Chand Goel 45 Matric 20 years 0.42%


Remaining 33% shares are held in equal share by M/s Parkland Projects & Infrastructure Pvt. Ltd. and M/s ARM Agro Products Pvt. Ltd. which are associate concerns of the company and have extended corporate guarantee to the Bank.

Further, the promoters are in talks with one of their overseas buyers to introduce it as an equity partner with 10% share-holding in the company. It is expected that the investment shall be made before 31.03.11.

The organizational set up of the company is considered satisfactory and it has appointed qualified & experienced technical persons to meet its day to day requirements.

Present Proposal:The present proposal involves enhancement of working capital limits from the existing level of Rs. 40.00 crores to Rs. 55.00 crores, renewal of stand-by limit at existing level of Rs. 5.00 crores under SBI Exporters’ Gold Card, renewal of forward contract limit of Rs. 15.00 crores (notional indebtedness Rs. 0.30 crore). The working capital facilities are proposed to be in consortium whereby our share shall be marginally raised from 69% to 70%, and the respective term loans with the Bank and Canara Bank will be on stand-alone basis.

c) Brief write-up on industry/sector and firm’s standing (domestic / international) in the industry including market share, future growth strategies, comments on recent newsreports, etc. (To mention / dovetail Premarketing Committee Presentation, if applicable)

India remains the second largest rice producer in the world after China. In the world trade of the commodity, volume wise, Thailand, USA and Vietnam account for 25%, 18% and 13% share respectively. India’s share is mere 5%. But, India along with Pakistan enjoys the distinction of producing long grain aromatic variety called Basmati and enjoys a premium in the world market because of characteristic aroma. Major destinations of Indian Basmati as also Non-Basmati (Parmal etc.) are Saudi Arabia, UAE, and other Middle East countries, U.K., Brazil etc. Indian rice trade suffers from handicaps of proper infrastructure like transport, material handling, warehousing storage facility, and at times, port congestion. Delay in shipments has, at times, led to cancellation of orders. The market abroad has been spoilt by unscrupulous traders known as fly-by-night operators who book orders at lower rates and not being able to deliver at the committed price, resort to mixing. Indian product is seen with suspicion and is subject to presort checks like in Saudi Arabia. The Government is taking some tangible steps to curb the activities of such unscrupulous operators. Exporter’s own reputation is what generally counts and repeat orders, non-return of bills, absence of quality disputes, growth in sales are some of the parameters to judge the exporters standing.Rice ProductionIndia remains the second largest rice producer in the world after China. In India, rice crop is cultivated in the Eastern region comprising of Orissa, Bihar, West Bengal, Assam, eastern UP, parts of MP and also in large parts of AP. However, basmati variety is concentrated in the northern belt in the districts of Karnal, Ambala and Kurukshetra in Haryana, Gurdaspur, Amritsar and Pathankot in Punjab and Dehradun in Uttrakhand, Saharanpur, Muzaffanagar and Nainital in UP. Haryana and Punjab together contribute about 90% of the Basmati Rice production in India. The variety of Basmati produced in India along with Pakistan enjoys the distinction due to its long grain and aroma. It commands a premium in the world market because of this characteristic aroma. Rice ExportsShare of Basmati Rice export from India is about 25% of total export of the commodity. The competition in Basmati is mainly from Pakistan and in other


varieties from Vietnam and Thailand. With the signing of the WTO, the prospects of exports of Indian agriculture products have improved. The Govt. has also identified Basmati Rice export as a thrust area for promotion and has abolished minimum export price on export of Basmati Rice, thereby providing flexibility to Rice exporters in pricing.

The industry is presently passing through a phase when dependence on Govt Policy is being reduced. Export prospects are good. The unit is manufacturing Par Boiled rice, which has good export market in Gulf countries.

During the Year ended 31.03.09 due to increasing price of food items, government has imposed ban on export of non basmati rice, levied export duty of $180/MT and fixed minimum export price ranging from $1000 to $1200/- to improve availability of rice in Indian market. Later with easing out of the food position and rice exporters pressing demand to relax export of rice, ban on PUSA 1121 was lifted and export duty was waived. All these steps improved the rice export market and export of rice picked up during the previous year. India’s Basmati exports this year (FY10) are likely to hit a record 3 million tonnes despite subsidy withdrawal from Saudi Arabia, setbacks to exports in Iran and the Dubai financial crisis. Exports up to December 2009 stood at 2.3 million tonnes and could easily go up substantially, industry sources said, although the price of the top quality rice may have dropped in the export markets compared to last year. (Source: The Economic Times, 26th January 2010)

Basmati rice exports from Indian have been rising steadily in the last few years, largely after government classified PUSA 1121 variety into the basmati category. The demand has come largely from Middle East countries, with Iran contributing almost 50% to the demand. The Agricultural and Processed Food Products Export Development Authority (Apeda) analysis has pegged total basmati exports at 2.3 million tonne in 2009-10. According to the latest data compiled by Apeda, exports of the premium aromatic rice has increased by an impressive 44% to 2.3 million tonne in comparison to 1.6 million tonne reported during 2008-09. In value terms, export of basmati rice has crossed Rs 12,000 crores last fiscal against Rs 9,476 crore achieved during 2008-09. (Source: The Financial Express, 22th June 2010)


SECTION 2 PRESENT PROPOSAL:A)

Sanction for i) Renewal of FBWC limits with enhancement from Rs. 22.50 crores to Rs. 38.50 croresii) Renewal of Stand-by Limit with enhancement from Rs. 5.00 crores to Rs. 5.50 crores, under SBI Exporters’ Gold Card iii) Forward Contract Limit of Rs. 0.30 crore (being the conversion factor of 2% of forward contract limit of Rs. 15.00 crores)

Approval for

i) Interchangeability to the extent of 50% or Rs. 5.25 crores from CC Hyp to EPC.ii) Interchangeability between Demand Loan against Warehouse Receipts and CC (Hyp.) limit.iii) Continuation of waiver of ECGC cover on pre-shipment (IPCG) and post-shipment (IPSG) limits (only for medium-risk and above countries, and buyers with satisfactory D&B reports) (Post-shipment waiver not approved).iv) Continuation of waiver of insurance cover for stocks against risk of theft and burglary, and for stocks lying outside of 150 ft. of mill area against risk of firev) Swing of FBWC limits into FCNB-DL (12 months tenor) at Card rate as per borrower’s rating of SB-8 (applicable pricing L+6.50%), subject to funds angle clearancevi) Waiver of hedging requirements on FCNB loansvii) Continuation of competitive pricing of CC limit at 4.75% above Base Rate (BR), present effective rate 13.00% p.a. with monthly rests against applicable pricing to a unit rated SB-8 i.e. 6.75% above BR viii) 25% concession in Processing Charges, i.e. recovery of Rs. 0.133 crore against applicable charges of Rs. 0.1772 crore ix) 25% concession in charges on issuance of FLC/Letter of Comfort for Buyer’s Credit, i.e. recovery of Rs. 0.075 crore against applicable charges on Rs. 0.10 crore

b) Credit Limits (Existing and proposed): (` in crores) EXISTING PROPOSED CHANGE

LIMITS SBI % CB* CONS SBI % CB* CONS SBI CONSFund based C.C. (Hyp) 9.10 91 0.90 10.00 10.50 70 4.50 15.00 +1.40 +5.00C.C. (BD) (3.50) 88 (0.50) (4.00) (3.50) 70 (1.50) (5.00) -- (+1.00)EPC 13.40 54 11.60 25.00 28.00 70 12.00 40.00 +14.60 +15.00FBP (Non LC) (6.50) 65 (3.50) (10.00) (10.50) 70 (4.50) (15.00) (+4.00) (+5.00)Stand-by limit 5.00 100 -- 5.00 5.50 70 2.50 8.00 +0.50 +3.00DL WHR$ -- -- -- -- (10.50) 70 (4.50) (15.00) (+10.50) (+15.00)Total FBWC 27.50 69 12.50 40.00 44.00 70 19.00 63.00 +16.50 +23.00Term Loan-I -- -- 7.68 -- -- -- 7.68 -- -- --Term Loan-II -- -- 5.44 -- -- -- 5.44 -- -- --Term Loan-III 5.00 100 -- -- 5.00 100 -- -- -- --For. Contract# 0.30 100 -- -- 0.30 100 -- -- -- --TOTAL FBL 32.80 100 25.62 40.00 49.30 100 32.12 63.00 +16.50 +23.00Non Fund -- -- -- -- -- -- -- -- -- --FLC (one-time) -- 100 (1.50) -- -- -- (1.50) -- -- --FLC (one time) (3.50) 100 -- -- (3.50) 100 -- -- -- --TOTAL NFB (3.50) -- (1.50) -- (3.50) -- (1.50) -- -- --Total FB+NFB 32.80 25.62 40.00 49.30 32.12 63.00 +16.50 +23.00

IDBI IDBIDL-WHR@ -- -- 10.00 -- -- -- -- -- -10.00 --

*CB: Canara Bank


CC (BD) limit is within CC Hyp. FBP limit is within EPC limit. Besides, FBP (Non-LC) limit as above, Canara Bank has also sanctioned an FBP (LC) limit of Rs. 4.50 crores. #Forward Contract indebtedness of Rs. 0.30 crore being the conversion factor of 2% on the Forward Contract Limit of Rs. 15.00 crores. $Interchangeability between CC Hyp. and DL-WHR is proposed.

@The company has availed a demand loan against warehouse receipts of Rs. 10.00 crores in December 2010 from IDBI Bank Ltd. The same shall be liquidated upon availment of the enhanced facilities proposed in the present proposal.

c) SHARING PATTERN ` in croresFinancial Arrangement: Consortium

FB NFB TotalSBI 49.30 (3.50) 49.30Ass.Bks. -- -- --SBI Group 49.30 (3.50) 49.30Other Banks 32.12 (1.50) 32.12Total 81.42 (5.00) 81.42


SECTION 3

PERFORMANCE DETAILS

a. PERFORMANCE AND FINANCIAL INDICATORS: ` in crores 31STMARCHMARCHMARCHMARCHMARCH 2008 2009 2010 2011 2012 FINANCIAL RATIOS AUD. AUD. AUD. ESTI. PROJ. Domestic sales 10.41 11.66 51.62 95.00 80.00 (23.12) (60.00) Export sales 20.00 61.47 60.70 65.00 120.00 (92.00)(100.00) Oth. Income/Export Incentive -- 0.07 0.10 -- --

1Net sales 30.41 73.20 112.42 160.00 200.00 (115.12) (160.00)

2Operating profit 0.16 1.07 2.38 4.91 6.51 (1.69) (4.81)

3Profit before tax 0.16 1.12 2.48 5.16 6.76 (1.69) (5.06)

4PBT/Net sales 0.53% 1.53% 2.21% 3.23% 3.38% (1.47%) (3.16%)

5Profit after tax 0.11 0.81 2.07 4.23 5.48 (1.18) (4.13)

6Cash accruals 0.11 0.88 2.57 5.23 6.48 (2.18) (5.13)

7PBDIT 1.00 3.22 6.38 11.86 13.48 (6.87) (11.76)

8Paid up capital 0.16 0.24 0.29 1.80 1.80 (0.29) (1.00)

9Tangible net worth 4.31 10.14 17.22 28.45 33.93 (16.07) (26.15) 10Adjusted TNW 4.31 10.14 17.22 28.45 33.93

(16.07) (26.15) 11TOL/TNW 4.03 2.95 2.71 2.63 2.53

(2.82) (2.27) 12TOL/Adjusted TNW 4.03 2.95 2.71 2.63 2.53

(2.82) (2.27) 13Current ratio 1.07 1.18 1.15 1.33 1.38

(1.14) (1.29) 14NWC 1.16 4.29 5.50 18.63 25.47

(4.86) (12.93)The figures as on March 31, 2008 pertain to the erstwhile firm M/s Ambica Rice Mills.The figures as on March 31, 2009 & 2010 pertain to the company Ambica Agrico Exports Pvt. Ltd. (renamed Shri Ambica Intl. Food Co. Pvt. Ltd. in April 2010).

The figures in parenthesis in March 2010 column represent estimates taken by Canara Bank at previous sanction in August 2009. The figures in parenthesis in March 2011 column represent estimates taken by us at last sanction in September 2010.

CPC, A.O. HARYANA SHRI AMBICA INTL. FOOD CO. PVT. LTD. TARAORI

` in croresQTRLY results as on 31.12.09 31.12.10Sales (combined) 57.27 96.08(Exports) (53.21) (35.97)PAT NA NA

b. Industry Exposure as on 30.06.10 (` in crores)FBL 15,428.71NFBL 1,653.96Total 17,082.67Exposure of the Company as per prudential exposure normsTo Industry exposure 0.31%To total advances (Domestic) 0.009%

8

c) Movement in TNW: Rs. in croresAs on 31/03 2008 2009 2010 2011 2012

Aud Aud Aud Esti ProjOpening TNW 0.16 4.33 10.14 17.22 28.45Add PAT 0.10 0.77 0.71 3.76 4.62Increase in capital -- 0.08 0.05 0.21 --Share Application Money 1.19 -1.00 0.01 -0.20 --Share Premium 2.85 5.92 4.95 6.99 --Deferred Tax Liabilities 0.03 0.04 1.36 0.47 0.86Add / subtract change in intangible assets -- -- -- -- --Adjust prior year expenses -- -- -- -- --Less Dividend/withdrawal -- -- -- -- --Closing TNW 4.33 10.14 17.22 28.45 33.93

d) Synopsis of Balance Sheet: Rs. in crores

Previous Year Last YearParticulars 2009 2010Source of FundsShare capital 0.24 0.29Reserves & surplus 9.83 15.50Secured loans : Short term 18.97 32.96 : Long term 7.11 11.75Unsecured loans 0.34 0.33Deferred tax liability 0.07 1.43Other liabilities -- --Total 36.56 62.26Uses of FundsFixed assets (Gross Block) 4.22 20.81Less depreciation 0.45 0.95Net block 3.77 19.86Capital work in progress 8.62 Other Non-Current Assets 0.09 1.10Inventories 14.60 25.78Sundry debtors 11.19 15.07Cash & Bank balances 1.15 1.59Loans & advances to subsidiaries & group companies -- --Loans & advances to others 0.64 0.56(Less current liabilities) (3.29) (1.53)(Less provisions) (0.21) (0.17)Net current assets 24.17 42.40Misc. expenditure (to the extent not written off or adjusted -- -- Total 36.56 62.26


SECTION 5 PRICINGa) CONDUCT OF ACCOUNT: (FY11)

No. of occasions

Average period for regularization Irregularity report last submitted on

Irregularity in WC:

5 i) 02.03.10 to 27.03.10: 26 days

ii) 14.04.10 to 31.05.10: 47 days

iii) 03.06.10 to 30.06.10: 27 days

iv) 01.12.10 to 02.02.11: 62 days

v) 03.02.11 till date

i) Irregularity since confirmed.ii) Irregularity since confirmed.iii) Irregularity since confirmed. iv) Irregularity report yet to be submitted.

Comments: -- Overdrawings were permitted by the branch/Circle management to enable execution of fresh export orders on account of delayed realization of export receivables.

Irregularity in TL:

Nil NA --

Comments: -- -- --Utilization of limits:FB Limits Average

utilization %

100%

NFB Limits

Average utilization %

NA

b) INCOME ANALYSIS: (Rs. in crores) SBI

From Estimated (FY10) Actual (FY10) Estimates (FY11) Projections (FY12)WC Int. 0.60 0.26 1.60 3.95TL Int. -- -- 0.10 0.40LC -- -- -- --BG -- -- -- --Bill -- -- -- --Forex 0.04 0.02 0.10 0.12Others 0.20 0.11 0.18 0.18Total 0.84 0.39 1.80 4.65

Interest & Other Charges as per Balance Sheet dated 31.03.10

SBI Share Amount Percentage

Interest: Rs. 2.98 croresCharges: Rs. 0.41 crore

Rs. 0.37 croreRs. 0.04 crore

12.42%10%

c. Other Bank’s/FIs pricing: The unit’s existing CC credit limits with Canara Bank is priced at 13.50% p.a. (Base Rate + 4%, Base Rate being 9.50%).


d) PROPOSED PRICING:Existing

(31.03.2010)*Proposed

(31.03.2010)*CRA PRICING CRA PRICING

Cash Credit

SB-8 (62)FR-9 (39)

2.75% above BR, minimum floor rate being 10.25% p.a., present effective rate being 11.00% (for a period of one year)

SB-8 (62)FR-9 (40)

4.75% above Base Rate (BR), present effective rate being 13.00% p.a.

Term Loan III

SB-8 (62)FR-9 (40)


SB-8 (62)FR-9 (42)

No Change.(Existing pricing to continue for 1 one year from approval and shall be reset thereafter).

*based on audited financials.For export finance as per Bank’s/RBI’s extant instructions.


SECTION C

CIRCLE CHANDIGARHBRANCH TARAORICOMPANY SHRI AMBICA INTL. FOOD CO. PVT. LTD.

Assessment of WC facilities:

a. Inventory & receivable levels: (Months/Days)

31.03.08(Actual)

31.03.09(Actual)

31.03.10(Actual)

31.03.11(Estimated at last sanction)

31.03.11(Estimated)

31.03.12(Estimated)

1 R.M. (a) Imported ----- Amount -- -- -- -- -- -- Months' consumption -- -- -- -- -- --(b) Indigenous-- Amount 3.02 5.29 16.43 23.70 34.00 41.30 Months' consumption (8.09) (1.02) (2.00) (2.00) (2.75) (2.75)

2 Finished goods Amount 7.71 9.31 9.35 12.00 18.00 22.65 Months' cost of sales (13.59) (1.82) (1.11) (1.00) (1.50) (1.50)

3 Receivables (a) Domestic Amount 0.66 2.26 7.54 7.48 7.50 10.00 Months' domestic sales (4.21) (2.33) (1.75) (1.50) (1.50) (1.50)

(b) Export Amount 5.80 8.93 7.53 12.50 12.50 15.00 Months' export sales (12.17) (1.74) (1.49) (1.50) (1.50) (1.50)

5 Creditors Amount 1.35 2.09 0.23 6.30 6.90 7.90 Months' purchase (3.62) (0.39) (0.03) (0.50) (0.50) (0.50)

b) Assessed Bank Finance (ABF): 31ST MARCH MARCH MARCH MARCH MARCH 2008 2009 2010 2011 2012 ASSESSED BANK FINANCE AUD. AUD. AUD. ESTI. PROJ.

1 Total current assets 18.01 27.58 43.00 75.57 93.112 Other current liabilities 2.36 4.32 4.54 11.94 12.643 Working capital gap 15.65 23.26 38.46 63.63 80.474 Net working capital(actual/proj.) 1.06 4.29 5.50 18.63 25.475 Assessed Bank Finance 14.59 18.97 32.96 45.00 55.006 NWC to Total current assets 5.89% 15.55% 12.79% 24.65% 27.35%7 Bank Finance to Total C.A. 81.01% 68.78% 76.65% 59.55% 59.07%8 Sundry creditors to Total C.A. 7.50% 7.58% 0.53% 9.13% 8.48%9 Other CL to Total C.A. 5.60% 8.08% 10.03% 6.67% 5.10%

10 Inventories to Net sales(Days) 511 73 84 119 11711 Receiv. to Gross sales(Days) 310 56 49 46 4612 S.Creditors to Purchases(Days) 170 12 1 15 15

c) Assessment as per Nayak Committee (for illustrative purposes):

1. Estimated turnover of the firm (FY12) Rs. 200.00 crores2. Working Capital Requirement@ 25% of estimated turnover Rs. 50.00 crores3. Borrower’s contribution to working capital@ 20% of

working capital requirementRs. 10.00 crores

4. Estimated NWC as on 31.03.11 Rs. 18.63 crores5. Assessed Bank Finance (lower of 2-3 and 2-4) Rs. 31.37 crores


d) Assessment of Individual Limits (FY12):

Assessment of Cash Credit (hyp.) Limit Amount in Crores Tot. Value Margin % Margin amt. Net value1 Raw material – Imp. -- -- -- -- 2 Raw material – Indig. 41.30 25.00% 10.33 30.973 Stocks-in-process -- 25.00% -- -- 4 Finished Goods 22.65 25.00% 5.66 16.995 Consumable spares -- Imp. -- -- -- --6 Consumable spares -- Ind. -- -- -- -- SUB-TOTAL 63.95 15.99 47.96 Assessment of Cash Credit (book debts) Limit Tot. Value Margin % Margin amt. Net value1 Receivables -- Domestic 10.00 40.00% 4.00 6.00 SUB-TOTAL 10.00 4.00 6.00 Assessment of Export Bills Purchase Limit Tot. Value Margin % Amount Net value1 Receivables -- Export 15.00 -- -- 15.00 SUB-TOTAL 15.00 -- 15.00

TOTAL 88.95 19.99 68.96

Against Permissible Bank finance of Rs. 68.96 crores, the following individual limits have been proposed in consortium subject to availability of Drawing Power:

Rs. in crores Sr. No. Nature of limit Totali) Cash Credit (Hyp.) 15.00ii) Cash Credit (BD) within CC Hyp. (5.00)iii) EPC 40.00iv) FBP (Non LC) within EPC (15.00)v) DL-WHR within CC Hyp. (15.00)

TOTAL 55.00

EPC limits under Exporter Gold Card Scheme (Rs. 40.00 crores):

Standby limit under Exporters’ Gold Card Scheme: Rs. 8.00 crores:

FBP (Non-LC) limit of Rs. 15.00 crores (within EPC limit):


SECTION D

CIRCLE CHANDIGARHBRANCH TARAORIFIRM SHRI AMBICA INTL. FOOD CO. PVT. LTD.

TERMS & CONDITIONS

Security:

(i) PRIMARY NatureWorking Capital 1st pari-passu charge (with other banks of the consortium) by way of

hypothecation of entire current assets of the company including raw material, stocks-in-process and finished goods lying at the premises of the company and lying anywhere else represented by documents of title to goods or by any other means and finished goods in transit represented by documents of title to goods or by any other means and book debts/receivables etc.

Term Loan i) 1st exclusive charge on fixed assets purchased out of the proposed term loan-III (to the extent of amount of the term loan as on 31.03.11 i.e. `5.00 crores), andii) 1st pari-passu charge (with other banks of the consortium) by way of equitable mortgage of factory land and building with estimated WDV of `7.42 crores as on 31.03.11) with the following details:Factory land and building measuring 53 Kanals 14 marlas, comprising three title deeds: i) 18 K-17 M comprised in khewat no. 12/9 min., khatouni no. 17 min. rect. no. 13, kh. no. 1 (8-0), rect. no. 14, kh. no. 5 (2-18), 17 (1-0), 14 (6-19),ii) 10 K-04 M comprised in khewat no. 9 min., kahtouni no. 14 min., rect. no. 9, kh. no. 9 min. (2-4), 10 (8-0), andiii) 24 K-13 M comprised in khewat no. 9 min., khatouni no. 14 min., rect. no. 13, kh. no. 11 (7-18), 20/2 (0-14), 14/6 (6-14), 15 (8-0), 16/1 (1-7) situated at Rakba village Sekhanpura, Nadana Road, Taraori (Not SARFAESI compliant)The above property is held in name of M/s Ambica Rice Mills (erstwhile firm of the promoters)^ and has realizable value of `12.60 crores vide valuation report dated 18.07.10.

^Formalities regarding change of title in favour of the company are under-way and are likely to be completed by 31.03.11.

(ii) COLLATERAL:1st pari-passu charge (with other banks of the consortium) on the following properties:

` in croresDescription Title holder Real.

ValueDate of valuation

Property mortgaged with Canara Bank:1. Equitable mortgage of commercial shop on plot area 149.33 sq. yards (14’ by 96’) covered area 1344 sq. ft. located at Grain Market, Taraori, Teh. Nilokheri (vide Regd. Sale Deed no. 189/1 dated 24.05.82.

M/s Ishwar Chand Goel & Co., prop. Sh. Ishwar Chand Goel S/o Sh. Sita Ram

0.41(0.41)

20.07.10(18.07.10)

2. Equitable mortgage of commercial shop no. 40 (single storey) measuring 189 sq. yards (20’ by 85’) covered area 1344 sq. ft. located at New Grain Market, Taraori, Teh. Nilokheri (vide Conv. Sale Deed no. 640/1

Smt. Darshana Devi W/o Sh. Ishwar Chand Goel

0.54(0.90)

20.07.10(15.07.10)


dated 06.08.07). 3. Equitable mortgage of agricultural land measuring 4K-16M comprised in khewat no. 16 min. khatouni no. 21, rect. no. 13, kh. no. 9/1 (4-16), situated at village Sekhanpur, Teh. Nilokheri(Not SARFAESI compliant)

Sh. Ishwar Chand Goel S/o Sh. Sita Ram

0.46(0.46)

20.07.10(18.07.10)

4. Equitable mortgage of residential-cum-commercial plot of land measuring 14 marla (423.44 sq. yards) comprising 2 title deeds:i) 6 marla (181.44 sq. yards or 1633 sq. ft.) situated at ward no. 9, kasba Taraori, Teh. Nilokheri, vide regd. sale deed no. 657/1 dated 10.07.90ii) 8 marla (242 sq. yards) comprised in khewat no. 16, khatouni no. 27, rect. no. 90, kh. no. 21/1/1 & 2/2 situated at Taraori, The. Nilokheri, vide regd. gift deed no. 1283/1 dated 24.11.06(While title deed (i) is already mortgaged with Canara Bank, title deed (ii) has been offered as additional collateral security. Since the land is contiguous, valuation has been carried out as one).


0.90(1.81)

20.07.10(18.07.10)

SUB-TOTAL 2.31Collateral Security mortgaged with the Bank:5. Equitable mortgage of residential plot of land measuring 5 marla comprised in khewat no. 109 min., khatouni no. 123 min., rect. no. 89. kh. no. 25/2/1 min (0-5) situated at Taraori, Teh. Nilokheri


0.26(0.26)

20.07.10(18.07.10)

6. Equitable mortgage of commercial shop on plot area 1 marla (or 30 sq. yards) as 1/37th share of 1K-17M comprised in khewat no. 321, khatouni no. 504 min., rect. no. 126, kh. no. 3 min. (1-17), situated in village Padhana, Teh.. Nilokheri. (on Nilokheri – Karnal G.T. Road near Hafed Godowns).

Sh. Parveen Kumar S/o Sh. Ishwar Chand Goel

0.15(0.15)

20.07.10(18.07.10)

7. Equitable mortgage of residential plot of land measuring 15 marla comprised in khewat no. 152, khatouni no. 172, rect. no. 89, kh. no. 25/2/1/2/2 (0-15) situated at Taraori, Teh. Nilokheri


0.77(0.77)

20.07.10(18.07.10)

SUB-TOTAL 1.18Additional Collateral Security8. Equitable mortgage of residential house built on plots with following details:i) measuring 6 marla comprised in khewat no. 8 min., khasra no. 21//2/1 min, Sonkara Road, Taraori, Teh. Nilokheriii) measuring 4 kanal – 14 marla comprised in khewat no. 2 min. & 61, khatouni no. 2 min. & 77 min., khasra no. 90-89//21/1 (2-18), 25/2 (1-16), Sonkara Road, Taraori. Teh. Nilokheri


1.90 20.12.10


GRAND TOTAL 5.39COLLATERAL COVERAGE 8.55%1st pari-passu charge (with other banks of the consortium) by way extension of charge on factory land and building

12.60120.07.10(18.07.10)

2nd charge on fixed assets (present and future) created out of other bank’s term loans, excluding value of land & building

4.21* WDV esti. as on 31.03.11

TOTAL SECURITY 22.20TOTAL SECURITY COVERAGE 27%

*Est. WDV as on 31.03.11 of FA (excluding land and building):`19.63 croresLess 1st charge on value of assets created by term loan-III: ` 5.00 croresLess value of assets on which Canara Bank has 1st charge(assets created out of it’s term loans): `10.42 croresResidual value of fixed assets: ` 4.21 crores(Although 2nd charge will be created on entire fixed assets created out of other bank’s term loans, only residual value has been reckoned for the purpose of arriving at security coverage.)

FBP (LC) limit of Rs. 4.50 crores sanctioned by Canara Bank on stand alone basis not reckoned in indebtedness for the purpose of arriving at security coverage.

Valuation reports have been obtained from Er. Ved Parkash Gupta, Ambala City, approved valuer on Bank’s panel. Realizable values have been reckoned at the level considered reasonable by the branch vide certificate dated 20.07.10, while value in parentheses mentioned below the same are those arrived at by the valuer. Lower of the two are being reckoned by us for the purpose of arriving at collateral coverage.

TIRs dated 15.07.10 in respect of all above properties have been obtained from Sh. S. K. Malhotra, Distt. Courts, Karnal, Advocate on Bank’s panel.

The branch has confirmed that the properties are SARFAESI compliant (except in case on properties mentioned at Sr. No. 1 & 4), have been physically verified by branch officials and valuations thereof have also been verified from independent sources and found to be in order.

Properties mentioned at Sr. nos. 1 to 4 continue to be mortgaged with Canara Bank, although our Bank has stepped-in as Leader of the consortium. Although the Branch is following up with Canara Bank for early release of the property, till such time the same is mortgaged with us, the Branch shall be advised to obtain a Letter of Comfort from Canara Bank. C) Directors’ Personal/Third Party Guarantees: (` in crores)

S.No. Name of the guarantors Net means as on 18.01.111. Ishwar Chand Goel 0.202. Subhash Chand Goel 0.153. Parveen Kumar Goel 0.244. Smt. Darshana Devi 0.25

Total 0.84As per opinion reports dated 05.03.11 compiled by Credit Analyst. Net Means does not include value of properties owned by the directors/guarantors and mortgaged to the Bank, and value of the directors’ investments in associate/family concerns, if any.


Corporate Guarantees of associate concerns:i) Parkland Projects & Infrastructure Pvt. Ltd. TNW `3.87 crore as on

31.03.10ii) ARM Agro Products Pvt. Ltd. TNW ` 3.42 crore as on

31.03.10

D) ECGC COVER: (Post-shipment waiver not approved)The company already enjoys waiver of ECGC cover on pre and post shipment limits being availed from Canara Bank as well as from our Bank. It has requested for continuation of the same.

It is proposed that waiver of ECGC cover on pre-shipment and post shipment limits be approved, subject to:

i) Satisfactory credit report on overseas buyers to be obtained from Dun & Bradstreet, which should be updated every 12 months, and

ii) The country of shipment/repatriation should not be a listed country according to ECGC and should enjoy Medium Risk and above status assigned by the Bank (FD, Kolkata).

E) MARGINS: (FOR EACH FACILITY AS APPLICABLE)

Existing ProposedCash Credit limit:RM 25% 25%SIP -- --FG 25% 25%Receivables domestic (cover period – 90 days) 40% 40%Receivables - Export Nil NilTerm Loan-III 37.50% --

F) RATE OF INTEREST: Existing

(31.03.2010)*Proposed

(31.03.2010)*CRA PRICING CRA PRICING

Cash Credit

SB-8 (62)FR-9 (39)


SB-8 (62)FR-9 (40)

4.75% above Base Rate (BR), present effective rate being 13.00% p.a.

Term Loan III

SB-8 (62)FR-9 (40)


SB-8 (62)FR-9 (42)

No Change.(Existing pricing to continue for 1 one year from approval).

*based on audited financials.For export finance as per Bank’s/RBI’s extant instructions.

G. OTHER TERMS & CONDITIONS: 1. Documents As per documents applicable to SSI advances2. Period of sanction WC: 12 months from the date of sanction.3. Validity of sanction WC : 3 months from the date of sanction

TL : 1 year from the date of sanction (in view of company’s request to arrange Buyer’s Credit)Improvement in pricing and concession in service charges: 1 month from the date of sanction

4. Basis of valuation Cost price, controlled price, invoice price or market


price whichever is lower.5. Cover period for book

debts90 days.

6. Repayment WC: Repayable on demand.TL-III: As per original repayment schedule (repayable in 19 quarterly instalments (first 11 quarterly intstalments of Rs. 0.20 crore each and next 8 quarterly instalments of Rs. 0.35 crore each) commencing from 30th September 2011. Last instalment payable on 31st March 2016).Interest will be recoverable as and when applied.

7. Inspections Once in a month at irregular intervals by field officer of Taraori branch and once in a quarter by CM/BM.

8. Insurance Current/fixed assets including Building, Machinery, Miscellaneous fixed assets, other movable assets etc. will be insured against the risks of flood, fire, theft, earthquake, SRCC, other natural calamities and transit risk etc. jointly in the name of the bank and the company at the latter’s cost and policy to be retained by the bank except for waiver of insurance as stipulated in the proposal. Insurance to be got done as per Bank’s tie up arrangement, through New India Assurance Co. using the Corporate Agency Code No 900042.

9. Service, Processing Charges/ Commission/ Other Charges

To be recovered as per the Bank’s extant instructions or as proposed in the present proposal, subject to approval by the competent authority.

10. Prepayment charges 2% of pre-paid amount of Term Loan facilities, and as per Bank’s instructions from time to time.
