APPRAISAL MEMORANDUM FOR ENHANCEMENT OF WORKING CAPITAL LIMIT OF Rs.55.00LACS TO 120.

00LACS TO M/S SAI ANNAPURNA AGENCIES

EXECUTIVE SUMMARY S FORMAT: Section A

ZONE/REGION: THIRUPATHI/GUNTUR BRANCH: PIDUGURALLA COMPANY/UNIT: M/S SAI ANNAPURNA AGENCIES Section Contents 1 Borrower profile a. Name , Address, Manufacturing activity/Locations, Date of incorporation, Banking arrangement etc of b. Brief Background(Company/ Group/ Promoters/ Management including shareholding pattern ) c. Brief write up on Industry/Sector and Companys standing d. RMD Advisory/qualitative approach/Quantitative approach/Comments e. Indebtedness/Exposure & capital charge 2 Present Proposal a. Proposal : For sanction/approval/confirmation b. Credit limits (existing and proposed) c. Sharing pattern Performance Details a. Performance and Financial indicators b. Industry exposure as on c. Movement in TNW d. Synopsis of balance sheet Risk assessment : a. Credit Rating b. Risk and mitigating factors c. Warning signals/Major irregularities in Inspection Audit/Credit Audit/Other Reports d. Security e. Changes in Security if any, justification Pricing a. Conduct of account b. Income analysis c. Other Banks/FIs pricing d. Proposed pricing Loan Policy : Deviations & Compliance: a. Whether names of promoters, directors, company, group concern figure in defaulters/willful defaulters list b. Deviation in Loan policy c. Deviation in Take over norms and comments d. Directors of Borrowers company: status of relation with Board/ Sr Official of the bank etc a. b. c. d. a. b. Future plans & Business Potential including cross selling/retail marketing Environmental and sustainability implications Earlier terms of Sanction: Compliance status Statutory dues /Contingent Liabilities Justification for the Proposal Recommendations :

Pages 2 2 2 2 2 4 4 4 5 6 6 7 8 8 8 8 8 10 10 10 10

11 11 11 11 12 12 12 12 12 13 13

SBH, M/S Sai Annapurna Agencies

SECTION 1 Branch PIDUGURALLA ZONE/REGION: THIRUPATHI/GUNTUR Borrowers Profile a..Name , Address, Manufacturing activity/Locations, Date of incorporation, Banking arrangement etc of Company: M/S SAI ANNAPURNA AGENCIES Address: D.No:7-376/3,Guntur Road Regd Office:

Opp: Anjireddy Hospital Piduguralla, Guntur Dt,A.P 522413

Godown( Locations): Residence :

5/13, Sivalayam Street, Piduguralla. Mr.Vaddavalli.Sarath Babu(managing Partner), D.No:5-12,Market street,Piduguralla,Guntur Dt,A.P522413
Constitution: Partnership IRAC StatusExisting Advances : N.A Investments : N.A Whole sale Dealer in ITC Products 01.12.2009

Segment: SSI

Industry: Trading Date of incorporation:

Banking arrangement : Sole Banking Existing Connection : YES If yes, date of last sanction/renewal: New unit : NO If Take over, whether all norms complied with : (Yes/No) N.A

b) Brief Background (Company/ Group/ Promoters/ Management including shareholding pattern): The unit M/s .SAI ANNAPURNA AGENCIES , Piduguralla has been established as A Partnership Firm on 14th December 2009 and the VAT registration with tax authorities is (TIN) 28330585837 at Piduguralla on 7th January 2010.The Firm is Maintaining Current account with us on 13th January 2010 and conduct of account is Satisfactory. The Firm is dealing in the wholesale distribution/sales of cigarettes , Food items and cosmetics etc.,The partners profile and The products of ITC Limited. the oparting results shown below. S.L No Name(Sri/Smt) 1 2 3 4 5 6 Sarath Babu Vaddavalli Madhusudhana Rao Vaddavalli Venkayamma Vaddavalli Vaddavalli Rajendra Babu Ramani Vaddavalli Chandra Sekhar Vaddavalli Designation M.Partner Partner Partner Partner Partner Partner Age/D.O.B 28/16.11.81 54/16.06.56 43/30.12.66 31/ 06.07.79 27/ 18.08.83 26 NW/IP 32.06/46.70 32.06/75.00 32.06/120.00 32.06/65.00 32.06/10.00 32.06/Nil
Share infirm %

20 15 15 20 15 15

Year Sale Profit after Tax Net Profit/ Net Sales (%) TOL TNW TOL/TNW Current Ratio

2009-10

2010-11

(Rs. In lac) 2011-12(Prov)

310.74 1.98 0.64 3.18 56.38 0.06 18.32

1566.51 10.78 0.69 56.69 31.19 1.82 1.53

2210.00 19.29 0.87 121.15 56.45 2.15 1.45

i.

RMD Advisory

N.A

ii. iii. iv.

Qualitative approach : N.A Quantitative approach: Comments: The proposal merits consideration as there is enough gap and the promoter has strong back up support on professional, managerial, social and Financial levels. Proposed to be changed to read as Moderately Positive Threshold for additional exposure Enhancement SB 10 and above New SB 8 and above

Name of the extant Advisory Grow Selectively comments

In the proposed proposal the CRA rating is SB-5 againast the threshold SB-8 for additional exposure and hence within the acceptable Band.

e) Indebtedness / Exposure & Capital Charge: Indebtedness Fund based Non fund based TOTAL (Indebtedness) Investment Leasing TOTAL (Exposure) Company Existing Proposed 57.15 0.00 57.15 0.00 0.00 57.15 121.15 0.00 121.15 0.00 0.00 121.15 Group Existing Proposed NA NA NA NA NA NA NA NA NA NA NA NA Proposed exposure Credit Risk conversi weight on factor NA as no 100% as NFB Limit company proposed account . is unrated.

Capital charge for Total exposure N.A

SECTION 2 PRESENT PROPOSAL: Proposal: a. For sanction of : i. Enhancement of Limit Rs.55 lakhs to Rs120.00 Lakhs For Working Capital Requirement ii . b. Approval of:

c. Confirmation of

SECTION 3

The proposal falls within the powers of Assistant General Manager as FB / NFB / Total indebtedness is Rs.121.15 lacs, Non-Corporate (ii) Involves policy level deviations: N.A (iii) is a director in Bank. N.A

Limits

E xi SBI

Proposed % Total Cons/ MBA. N.A N.A N.A N.A N.A N.A N.A N.A SBI % Total Cons/ MBA. N.A N.A N.A N.A N.A N.A N.A N.A

Change SBI Total Cons / MBA. N.A N.A N.A N.A N.A N.A N.A N.A

C/C (Stocks) C/C (Book Debts) Total FBWC TLs Total FB LC BG Total NFB Total FB+NFB

55.00 55.00 2.15 57.15 0 0.00 0.00 57.15

N.A 100 N.A 100 N.A N.A N.A 100

120 120 1.15

100 100 100

120 120 1.15 121.15 0 0.00 0.00 121.15

121.1 100 5 0 N.A 0.00 0.00 N.A N.A

121.1 100 5

b.Credit Limits (Existing and Proposed) : (Rs. in lacs) c. SHARING PATTERN: Not Applicable (Sole Banking) Financial Arrangement: Sole Banking/Consortium/ Multiple Banking Lead Bank: FB NFB Total SBH 121.15 0.00 121.15 Ass.Bks. 0 0 0 SBI Group 0 0 0 Other Banks 0 0 0 Total 121.15 0.00 121.15

Performance Details a. PERFORMANCE AND FINANCIAL INDICATORS: (Rs. in lac)

Parameters Domestic Sales(Gross) Export Sales Net Sales % rise/fall (-) in net sales Profit Before tax PBT/ Sales (%) Profit After Tax PBDIT/Interest (times) Cash Accrual Paid Up Capital TNW TOL/TNW (times) Adjusted TNW Adjusted TOL/TNW NWC Current Ratio

2009-10 AUD
310.74

2010-11 AUD
1566.51

2011-12 PROJ
2210.00

2012-13 PROJ
2400.00

0.00
310.74

0.00
1566.51
404.12

0.00
2210.00
41.07

0.00
2400.00
8.60

2.00 0.64 1.98 0.00 2.06 56.38

11.31 0.72 11.28 5.28 12.06 31.67

19.33 0.87 19.29 6.56 19.90 56.45

21.66 0.90 21.61 2.88 22.12 65.55 65.55 1.84 65.55 1.84 34.6 1.53

56.38
0.06

31.19
1.79

56.45
2.15

56.38
0.06 94.51 18.21

31.19
1.79 34.94 1.54

56.45
2.15 31.19 1.45

Comments only on adverse movements in the above: (Not to exceed 5-6 lines) FINANCIAL KEY FACTORS:Sales / Gross Receipt: 1) During the year 2010-11, the unit has recorded a sales of Rs.1566.51 Lakhs throughout the year, and has estimated sales Rs.2210.00Lakhs for the Financial year 2011-12, as against the estimated sales , the firm has achieved around Rs.1950 Lakhs as per VAT returns. in view of the Past performance the estimated sales are treated reasonable and accepted the same. Raw Materials & Consumables:
The Borrower is Trader, Hence No Raw material required

PBT/Net Sales: 1) The firm achieved Profit of Rs.10.78 Lakhs in the financial year 2010-11, the profits are in tune with the sales estimated by the Firm.

TNW: 1) The Firm has Started with a capital of Rs. 55.00 lakhs, the TNW of the Firm is estimated at Rs.56.45 Lakhs. The firm proposed to retain its Profits in the Business and thereby increasing its net worth year by year. . TOL/TNW: The gearing ratio(TOL/TNW) of the firm is 1.82 as on 31.03.2011, and It will be increased due to present proposal in F.Y: 2011-12 Current Ratio: The current ratio is more than acceptable level 1.33 during the year under consideration. The Present current ratio is 1.45 in the year 2011-12, i s m o r e t h a n a c c e p t a b l e l e v e l .

b.Industry Exposure as on FBL NFBL TOTAL

Whole Bank Level (Rs. in crores)

Q/HY results as on 31.01.2012 Net Sales Exports PAT

Prev. year (2010-11)

Current Year (2011-12)

1174.88 0.00 9.02

1952.00 0.00 16.06

Exposure of the company as per Prudential Exposure Norms (%) To Industry Exposure - (%) To Total Advances (Domestic) - (%) Comments only on adverse movements in the above: (Not to exceed 5-6 lines): -----------------------------NIL---------------------- c) Movement in TNW (projection) 2009-10 Actual Opening TNW 54.46 Add PAT 1.98 Add. Increase in equity / premium Add./Subtract change in assets Adjust prior year expenses Deduct Withdrawals Closing TNW Comments:intangible %

2010-11 Estimated 56.38 11.28

2011-12 Projected 31.67 19.29

0.00
--0.06 56.38

0.00
--35.99 31.67

8.49 -3.00

56.45

d) Synopsis of Balance Sheet: Actuals 2010-11 Sources of funds Share Capital Reserves and Surplus Secured Loans : short term : long term Unsecured Loans Deferred Tax Liability Total Application of Funds Fixed Assets (Gross Block) Less Depreciation Net Block Capital Work in Progress Investments Other Non Current Assets Inventories Sundry debtors Cash & bank balances Other Current Assets Loans & advances to subsidiaries and group companies Loans & advances to others ( Less : Current liabilities ) (Less : Provisions ) Net Current Assets Misc. Expenditure (To the extent not written off or adjusted ) Total 31.67 ---1.66 0.00 33.33 3.92 0.16 3.76 Estimates 2011-12 56.45

0.00 57.60 3.94 0.75 3.19

1.15

33.76 5.28 44.62 0.97 0.00 0.00 55.00 0.06 29.57 -33.33

45.00 32.00 96.45 1.00 0.00 0.00 120.0 0 0.06 54.39 3.7 -57.60

Comments only on adverse movements in the above: (Not to exceed 5-6 lines)

RISK ASSESMENT a. CREDIT RATING Borrower rating WC Exist: Prop CRA NA

SB-4(82.50/100)

SECTION 4 Facility rating TL Exist: Prop SB-4 SB - 4 Facilities Existing Proposed Hurdle rate SB10 CC+TL NA NA

Marks CRISIL ICRA Others (Marks scored in borrower rating / facility rating to be mentioned). The CRA of the unit is based on projected balance Sheet as on 31.03.2012. The unit has completed only for 1 year. Validated on: No validation committee at this centre. b. Risks and mitigating factors: Critical risks perceived Mitigating factors The promoter is not able to arrange NO margin required to complete the proposl.

Proposed technology & machines N.A would not full fill requirement.

Change in Technology Tough competition from other players

Limited technology Required, Firm Has Adequate technology. The ITC Ltd Directly Sell the products to our Firm, The firm acting s a Monopolistic Nature In Our Locality.

Succession Plan Raw Material Failure of Power Supply

All the Partners are Family members, Mutual Cooperation is very well among the partners. .N.A

N.A

M/S SAI ANNAPURNA AGENCIES

10

c. Warning signals / Major irregularities in Inspection report / Credit Audit:/Other reports Credit Audit Reports NIL EXISTING UNIT Other Audit Reports NIL Qualification if any, in Auditors report NIL d. SECURITY Primary Security Details Value and basis of valuation Date of valuation /opinion report

Hypothecation of

185 Lakhs

20.03.2012

inventory of the Firm

For others

N.A

Collateral security Details :

Name of the owner of the property Description of the property Sites situated at D.No: 296/B Opp: Sri Chaitanya Techno School Piduguralla, Guntur Dt A.P-522413 Residential Building Shri .Sarath Babu Vaddavalli (Managing Partner of the Firm) D.No: 5-13 Sivalayam street,Nearvegetable Market, Piduguralla, Guntur Dt A.P-522413 Rs.46,70,000.00 Value (Rs)

Shri .Sarath Babu Vaddavalli (Managing Partner of the Firm)

532.40Sq.Yards Rs.1,06,48,000.00

Guarantators details

Personal Guarantee of all Partners

Name(Sri/Smt) Sarath Babu Vaddavalli Madhusudhana Rao Vaddavalli Designation M.Partner M.Partner Age/D.O.B 28/16.11.81 54/16.06.56 NW/IP 32.06/46.70 32.06/75.00

S.L No 1 2

M/S SAI ANNAPURNA AGENCIES

11

3 4 5 6

Venkayamma Vaddavalli Vaddavalli Rajendra Babu Ramani Vaddavalli Chandra Sekhar

Partner Partner Partner Partner

43/30.12.66 31/ 06.07.79 27/ 18.08.83 26

32.06/120.00 32.06/65.00 32.06/10.00 32.06/Nil

M/S SAI ANNAPURNA AGENCIES

12

PRICING: As per CRA rating SB -4, For CC Base Rate + 4.5% on Monthly Rests. . For TL Base Rate + 5.00% on Mothly Rests a) CONDUCT OF ACCOUNT: No. of occasions Comments: Irregularity in TL Comment NIL s: Utilisation of limits: FB Limits Average % NFB Limits Average % b) INCOME ANALYSIS: From WC Int. & Charges TL Int. LC BG Bill Forex Others(Charges ) Interest & Other Charges Interest Other Charges c. Other Banks/FIs Pricing Existing Term Loan NA Working Cap[ital NA

SECTION 5

New connection (last year) Average period Irregularity report last submitted on for regularization

NIL
utilisation NA utilization NA

( Rs. in lacs) competition SBI Estimated Actual (last year) (last year)

2.50 0.32
NA NA NA NA NA

2.50
0.22 NA NA NA NA NA

Estimates (current year) 3.36 0.11 NA NA NA NA 0.60

SBI Share Amount and percentage 100% 100%

Proposed NA NA

d. PROPOSED PRICING: ITEM Existing Rate Card rate Proposed rate Int. on WC NA 13.75%(SB-5) 13.75%(SB-5) Int. on TL NA 14.25%(SB-5) 14.25%(SB-5) Justification for concessions already extended / proposed: (mention about cost benefit): No concession is proposed. M/S SAI ANNAPURNA AGENCIES

13

LOAN POLICY: DEVIATIONS AND COMPLIANCE SECTION - 6 a. Whether names of promoters, directors, company, group concerns figure in defaulter/willful defaulters list: RBI defaulters list dated : Name of the director : Yes/No Remarks

Default in connection with: (Name of the company)

N.A Justification for considering N.A continuation / enhancement in facilities) Wilful defaulters list dated : : Yes/No ** Name of the director Remarks Default in connection with: (Name of the company N.A Justification for considering N.A continuation / enhancement in facilities) ECGC caution list N.A CIBIL ** **Internet is not working at our outfit, hence search report has not been enclosed. However as per the CBS report available at our outfit, no any account is NPA as on date. b. Deviations in Loan Policy: Parameters 1. 2. 3. 4. 5. 6. 7. 8. Indicative Min/Max level as per loan policy 1.33 3:1 1.75 2:1 20% of Equity N.A N.A N.A Company's level as on 31.03.2012 (PROJECTED) 1.45 2.15 0.19 0.02 100% of equity N.A N.A N.A N.A N.A

Liquidity TOL/TNW Average gross DSCR (TL) Debt / equity Promoters contribution Prudential norms FB exposure to the industry Substantial exposure : Borrower 9. Substantial exposure : Group N.A 10. Others N.A Brief comments only if there is deviation (Not more than 5 lines):

*If we consider the unsecured loan of Rs15.00lacs form relatives as quasi equity the ratio reduces to 0.78 only. c. Deviations in Take over norms and comments: NIL d. Directors of the borrower company are relatives (scope of the term relative as defined in RBI Master Circular on loans and advances- Statutory and other Restrictions) of any member of the Banks Board/Senior Officer of the Bank/ Member of any other Banks Board - Yes/No If yes, details: N.A e. Compliance with Section 20 of the Banking Regulation Act : Whether any of the Directors of the Bank is Director of the borrower company or is having any interest in the same: No

14

SECTION 7 a. Future Plans & Business potential(over a 3-5 year horizon) including Cross selling / Retail Marketing based on Co / Groups future plans: (to be quantified). Item Present Position Whether Tied Up? (Yes / No) * N.A N Business estimated

(i) (ii)

(iii) (iv) (v) (vi) (vii)

(viii)

Corporate Salary Package P Segment Loans (a) Housing (b) Auto Loans (c) Personal Loans SBI Credit Card SBI Life SBI Mutual Funds SBI Vishwayatra Foreign Travel Yatra Cards Vendor/ Dealer Finance Any Other (Please specify)(SRTO)

N N N N N N

* If no, please advise efforts made and outcome thereof b. Environmental and sustainability implications:

NIL

c. Earlier terms of Sanction: NA d. Statutory dues/other contingent liabilities: Dues Statutory dues Contingent liabilities Level (Rs. in crore) NIL NIL Impact on financial position NA NA

a. Justification for the proposal: (Only bullet points)

i.

SECTION 8 M/s sai Annapurna Agencies is a Partnership firm established on 14th December 2009,Sri Sarath Babu Vaddavalli s/o Madhusudhana Rao is the Managing partner is well experienced, good job knowledge of the activity and skill to manage the unit successfully. Higher skills of labour is not necessary for this firm The projected business level, viability and other assumptions and the limits proposed are reasonable. The quality of management is satisfactory and the applicant is having adequate experience in this line of activity.

ii.
iii.

iv.

v. The firm banking with us since their inception, and they paying their bills to suppliers through RTGS and routing all their transactions in their current account maintained with us. 15

vi. I view of the experience of the partners in the field and viability of urban collateral and satisfactory financials of the firm, we may consider the proposal of enhancement to Rs.120.00 lakhs to M/s Sai Annapurna Agencies vii. All Partners are family Members. They are owing another firm M/s.Sai Annapurna Lime Industries, Prop: V.Venkayamma (One of the Partners of present firm) and dealing with our branch for more than five years .the firm has availed Cash sredit and term loan frm our branch and conduct of accounts are satisfactory. viii. The Legal openion and Search reports are obtained from Sri Reddy sambasiva rao , Panal Advocate, Piduguralla on 21.01.2012.the advocate has opined that the mortgager has clear marketable title over the properties and can create a valid equitable mortgage in favour of the bank The independent Valuation report and Inspection report by Sri. Saidaiah Branch manager, who has inspected the above properties situated at Piduguralla on 23.02.2012 and opined that the Valuation made by the valuer is reasonable and acceptable.
x. CIBIL : Verified on 14.09.2010 in the name of all partners and observed no adverse features. Exposure comes under SSI under SMECFL scheme, which are Finance. the thrust areas for Bank

ix.

The unit has started its production since End of Dec 2009. CRA has been done on Simplified Model (Non-Trading) on the basis of estimated financial statement as on 31.03.2012 and borrower rating qualifies to SB-5 (Score-80.25/100) which is above hurdle rate of SB -10. This shows our risk level as Moderate risk with adequate cushion and comfort level as adequate safety. A.Recommended for Sanction on banks usual terms and conditions: In view of the foregoing and the annexure enclosed herewith, we recommend for (1)For sanction of : (i) Enhancement of CC (stock) limit of Rs. 120.00 lacs.. . Appraised by Assessed by Credit Officer Chief Manager (Loan Sanction) SBH SBH, Piduguralla SBH, Piduguralla : 23.02.2012 Date: Sanctioned, as recommended, on banks usual terms & conditions. (1)For sanction of : (iii) Enhancement of CC (stock) limit of Rs. 120.00 lacs

xi.. x.

Estimated sales for 2011-12 Rs.2210.00 lac appears justified and achievable.

Asstt. General Manager (SBH , Piduguralla Date:-

16

Section - C

Assessment of WC facilities: (If the assessment of the WC limits is based on any other parameters, please specify them along with an explanation) a. Inventory & receivable levels: (Months/Days)
Particulars Raw Material :a)Indegenous b) Imported Stock in Process Finished Goods Other Spares : a)Indigenous /Consumables b) Imported Receivables : a) Domestic b) Export Advance Payments S. Creditors Other Creditors Other Current Assets
2009-10 AUD 2010-11 EST 2011-12 PROJ 2012-13 PROJ 2013-14 PROJ 2014-15 PROJ

0.00
0.00

0.00
0.00

0.00
0.00

0.00
0.00

0.00 0.00 0.00

0.00

0.00 0.00 0.00

0.00

0.00 0.00 0.00

0.00

0.00 0.00 0.00

0.00

0.00
0.00

0.00
0.00

0.00
0.00 45.00 2months

0.00
0.00

0.00
0.00

0.00
0.00

24.10
0.5 month

33.76
2months

52.00
2months

56.00
2months

58.00
2months

0.00
0.00

0.00
0.00

0.00
0.00

0.00
0.00

0.00
0.00

0.00
0.00

0.00 0.00

0.00 0.00

0.00 0.00

0.00 0.00

0.00 0.00

0.00 0.00

14.89 10 days
0.00 0.00 0.00

5.28 10
0.00 0.00 0.00

32.00 10
0.00 0.00 0.00

60.00 10
0.00 0.00 0.00

65.00 10
0.00 0.00 0.00

70.00 10
0.00 0.00 0.00

3.14 0.5month
0.00 0.00

0.00
0.00 0.00
OCC

0.00
0.00 0.00

0.00
0.00 0.00

0.00
0.00 0.00

0.00
0.00 0.00

FORM V I Method of Lending Base Year : 2010 / TRADER PARTICULARS ACTUAL 31/03/2010 1 2 3 4 5 6 7 8 9 Total Current Assets,(6 in Form IV) Current Liabilities (Other than bank borrowing) (2 to 9 of Form III) Working Capital Gap (WCG)(1-2) Minimum stipulated net working Capital i.e. 25% of WCG/25% of total current asset as the case may be depending upon the method of lending being applied (Export receivables to be excluded under both methods) Actual/projected net working capital (46 in Form III) Assessed Bank Finance (3-4) Item 3 minus item 5 Maximum permissible bank finance (Item 6 or 7 whichever is Lower) Excess borrowings representing shortfall in NWC(4-5) 58.28 3.2 55.08 13.77 55.08 41.31 0 0 -41.31 31/03/2011 84.63 0.06 84.57 21.14 29.57 63.43 55 55 -8.43 ESTIMATED 31/03/2012 174.45 0.04 174.41 43.6 54.41 130.81 120 120 -10.81 Amount in Lakhs PROJECTED YEARS 31/03/2013 183.57 0.05 183.52 45.88 63.52 137.64 120 120 -17.64 31/03/2014 191.6 0.06 191.54 47.89 71.54 143.65 120 120 -23.65 31/03/2015 200.14 0.07 200.07 50.02 80.07 150.05 120 120 -30.05

FORM V II Method of Lending Base Year : 2010 / TRADER PARTICULARS 1 2 3 4 5 6 7 Total Current Assets,(6 in Form IV) Current Liabilities (Other than bank borrowing) (2 to 9 of Form III) Working Capital Gap (WCG)(1-2) Minimum stipulated net working Capital i.e. 25% of WCG/25% of total current asset as the case may be depending upon the method of lending being applied (Export receivables to be excluded under both methods) Actual/projected net working capital (46 in Form III) Assessed Bank Finance (3-4) Item 3 minus item 5 ACTUAL 31/03/2010 58.28 3.2 55.08 14.57 55.08 40.51 0 31/03/2011 84.63 0.06 84.57 21.16 29.57 63.41 55 ESTIMATED 31/03/2012 174.45 0.04 174.41 43.61 54.41 130.8 120 31/03/2013 183.57 0.05 183.52 45.89 63.52 137.63 120 Amount in Lakhs PROJECTED YEARS 31/03/2014 191.6 0.06 191.54 47.9 71.54 143.64 120 31/03/2015 200.14 0.07 200.07 50.04 80.07 150.03 120

17

8 9

Maximum permissible bank finance (Item 6 or 7 whichever is Lower) Excess borrowings representing shortfall in NWC(4-5)

0 -40.51

55 -8.41

120 -10.8

120 -17.63

120 -23.64

120 -30.03

FORM V - COMPUTATION OF MAXIMUM PREMISSIBLE BANK FINANCE FOR WORKING CAPITAL AS PER NAYAK COMMITTEE Base Year : 2010 / TRADER PARTICULARS 1 2 3 4 5 6 7 8 9 10 Total Current Assets Current Liabilities Working Capital Gap Working Capital Cycle (in months) Liquid Surplus Projected turnover % of liquid surplus to projected turnover Permissible Bank Finance Margin Money Ratio of Margin money to bank finance ACTUAL 31/03/2010 58.28 3.2 55.08 0.46 16.4 310.74 5.28 62.15 15.54 [ 1:4 ] [ 1:4 ] 31/03/2011 84.63 0.06 84.57 0.24 44.62 1566.51 2.85 313.3 78.33 [ 1:4 ] ESTIMATED 31/03/2012 174.45 0.04 174.41 0.29 96.45 2210 4.36 442 110.5 [ 1:4 ] 31/03/2013 183.57 0.05 183.52 0.46 70.37 2400 2.93 480 120 [ 1:4 ] Amount in Lakhs PROJECTED YEARS 31/03/2014 191.6 0.06 191.54 0.53 69.2 2600 2.66 520 130 [ 1:4 ] 31/03/2015 200.14 0.07 200.07 0.53 70.34 2800 2.51 560 140

CC (stocks) limit of Rs.120.00 lac is being recommended for sanction as assessed above. c. Assessment of EPC / FBD limits: N.A.
d. Computation of LC limits for WC:

N.A

Annual RM Cons.under LC Monthly RM purchases Usance Lead time L/C Limit required Recommended LC limit Documentary :

Non Documentary : N.A

Assessment of BG limit: Outstanding BGs as on 11.05.2010 Add: BGs required during the period (2010-11) Less: Estimated maturity/cancellation of BGs during the period (2010-11) Requirements of BGs Recommended BG limit Financial : Performance :

18

f. Efficiency ratios: 2009-10

Particulars Net Sales/ Total Tangible PBT/ Total Tangible Assets (%) Operating Cost to sales (%) Bank Finance/ Ct. Assets (%) Inventory+ Receivables to net Sales ROCE (%) (PBDIT/TTA)

2010-11 AUD 17.72 0.72 99.28 64.99 2.50 18.42

AUD 5.22 0.64 99.36 0.00 12.55 1.78

2011-12 EST 12.44 0.87 99.13 68.79

2012-13 PROJ 12.88 0.9 99.10 65.37

3.48
17.4

4.67
16.74

Brief comments on the assessment of the above limits:

h. Fund Flow Analysis Particulars Long Term Sources Long Term Uses Surplus/Deficit

: 2009-10 EST
0 0 0

2010-11 PROJ
-22.3 3.21 -25.51

2011-12 PROJ
25.36 0.51 24.85

2012-13 PROJ
9.57 0.45 9.12

Comments: Fund Flow analysis shows satisfactory.

19

Terms & Conditions: ZONE: THIRUPATHI COMPANY: M/S Sai Annapurna agencies

SECTION D

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Collateral security Details :

Name of the owner of the property Description of the property Sites situated at D.No: 296/B Opp: Sri Chaitanya Techno School Value (Rs)

Shri .Sarath Babu Vaddavalli (Managing Partner of the Firm)

532.40Sq.Yards Rs.1,06,48,000.00

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Piduguralla, Guntur Dt A.P-522413

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Residential Building Shri .Sarath Babu Vaddavalli (Managing Partner of the Firm) D.No: 5-13 Sivalayam street,Nearvegetable Market, Piduguralla, Guntur Dt A.P-522413 Rs.46,70,000.00

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Personal Guarantee of all Partners

S.L No 1 2 Name(Sri/Smt) Sarath Babu Vaddavalli Madhusudhana Rao Vaddavalli Designation M.Partner M.Partner Age/D.O.B 28/16.11.81 54/16.06.56 NW/IP 32.06/46.70 32.06/75.00

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Venkayamma Vaddavalli Vaddavalli Rajendra Babu Ramani Vaddavalli Chandra Sekhar

Partner Partner Partner Partner

43/30.12.66 31/ 06.07.79 27/ 18.08.83 26

32.06/120.00 32.06/65.00 32.06/10.00 32.06/Nil

Deviation from existing security (if any) to be mentioned in the proposal. B.

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ECGC COVER: N.A C. MARGINS: (FOR EACH FACILITY AS APPLICABLE)

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Cash Credit: RM: Domes tic SIP FG Receivables (Cover ---days) Letter of Credit BG

Existing N.A

Proposed

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Justification for deviation from existing margins, if any to be provided in the proposal .

D. RATE OF INTEREST: Facility i.) ... CRA(SB- 4) 4.5% above the Base Pricing

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Rate ii) . .

iii) .

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SECTION D contd E. Insurance: Ensure to insure the stocks & collateral security with united india insurance Co.Ltd

F.

Processing fees:

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Inspection : H. Term Loan margin: I i) REPAYMENT SCHEDULE: ii) Repayment to start from :

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J. OTHER CRITICAL COVENANTS:

Note : Any change in the terms and conditions vis--vis earlier sanction should be justified in the proposal.

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