CRISIL launches IPO grading service
Assigns grades to the proposed IPO of two companies

Mumbai - August 10, 2006

In keeping with its pioneering work in the field of rating and grading services, CRISIL has launched its IPO grading service. IPO grading is a globally unique concept introduced into the Indian market under the aegis of the Securities and Exchange Board of India (SEBI) (

The CRISIL IPO grading is designed to provide investors an independent, reliable and consistent assessment of the fundamentals of new public issues. This offering may be especially useful to retail investors who are seeking to invest in companies that are unknown in the equity markets.

CRISIL has played a central role in the conceptualisation and development of the idea of IPO grading and believes that a grading provided by an independent entity would be a significant addition to the presently available tools for assessing the investment attractiveness of IPO offerings. The CRISIL IPO grading includes an assessment of business and financial prospects, management quality and corporate governance; and reflects CRISIL's unique understanding of these issues, particularly corporate governance.

CRISIL IPO gradings are assigned by CRISIL Research, the research business of CRISIL. It deploys industry experts to assign the CRISIL IPO grading. CRISIL Research pioneered the concept of industry research in India and its 16-year track record has enabled it to develop significant sector knowledge and expertise. CRISIL Research works independently from CRISIL Ratings. These two divisions in CRISIL do not share any confidential information provided to them by their respective clients.

The CRISIL IPO grading Scale

CRISIL IPO grade Assessment
5/5 Strong fundamentals
4/5 Above average fundamentals
3/5 Average fundamentals
2/5 Below average fundamentals
1/5 Poor fundamentals

CRISIL assigns CRISIL IPO grade 2/5 to Shree Ashtavinayak Cine Vision's IPO

Proposed public issue of 3,300,000 equity shares at a target price of Rs 158 per share aggregating Rs 520 million

CRISIL has assigned a 'CRISIL IPO grade 2/5' to the proposed initial public offer of Shree Ashtavinayak Cine Vision Ltd (SACVL). The grading reflects the successful track record of the management, which has created a name for itself in film industry in a short span of three years, and the fact that SACVL is one of the country's leading film producers and one of the leading distributors in the Mumbai territory.

The grading is, however, constrained by the risks inherent in the Indian film industry where entry barriers are low and the susceptibility of the business model to both rapid changes in audience tastes and preferences and uncertainties arising out of the rudimentary methods used for arriving at the value of a film and its components. In addition, the company has a relatively short track record of proven performance, has a high dependence on the skills of its managing director and majority shareholder, and has a relatively under developed corporate governance system.

About the company
Shree Ashtavinayak Cine Vision Ltd. (SACVL) was incorporated in October 2001 as a private limited company. Initially, the focus of the company was on production of television serials. The focus of the company changed to film production and distribution after the induction of Mr. Dhilin Mehta, the present Managing Director, on the Board of Directors in March 2002. The company was converted into a public company in June 2004. SACVL has produced 4 films and distributed 21 films to date. In film distribution, SACVL's presence is mainly restricted to the Mumbai territory. The company also has a small presence in film exhibition through tie-ups with 25 theatres across the Mumbai territory for screening content selected by it. For the year ended March 2006, SACVL reported a net profit of Rs 74.7 million on operating income of Rs 603.4 million, as compared to PAT of Rs 3.5 million and operating income of Rs 265.5 million in 2004-05.

CRISIL assigns CRISIL IPO grade 2/5 to Minar International's IPO

Proposed public issue of 8,000,000 equity shares at a target price of Rs. 170 per share aggregating Rs. 1356 million

CRISIL has assigned a 'CRISIL IPO grade 2/5' to the proposed initial public offer of Minar International Ltd (Minar). The grading reflects the good track record of the promoter Mr. U.K. Nambiar, who has a cumulative experience of over 40 years in the textiles business and the strong growth prospects for export of made-up textiles from India to the US which is expected to nearly double over the next five years.

The grading is constrained by the company's high dependence on the skills of Mr. Nambiar for business continuity, the lack of adequate experience in setting up or running large textile manufacturing facilities (although the company owns a CMT facility), the inexperienced second line of management and a challenging business environment post removal of quotas, as large US buyers prefer larger vertically integrated suppliers. The grading also reflects the lack of adequate corporate governance systems in the company, the existence of other promoter-owned entities in similar lines of businesses and the past instances of legal non-compliance by the company.

About the company
Minar International Ltd. (Minar) started operations as proprietary concern in 1981, became a partnership in April 1995 and was subsequently converted into a public limited company in January 2006. The company has two CMT (cut, machine and trim) units at Vasai near Mumbai with a capacity to manufacture 10,000 sheet sets per day. Minar proposes to integrate backwards by setting up a wide-width fabric processing unit in Erode district, Tamil Nadu, with a capacity to process 60,000 metres of fabrics per day. The project is estimated to cost Rs. 1,356 million and is expected to be fully funded out of the IPO proceeds.

For the nine months ended December 2005, Minar reported a net profit of Rs 90 million on an operating income of Rs 2.43 billion. On an annualised basis, operating income for 2005 was higher by 13 per cent as compared with the corresponding figure in 2004, and net profit for the comparable period was higher by 75 per cent.

Analytical Contact Media Contact
Ajay Dwivedi
CEO - CRISIL Research and Information Services Ltd.
Phone: ++91-22-6691 3502

Sanju Shishodia
Head, CRISIL Research
Tel: +91-226644 4146

Client Servicing
Tel: +91-66913561.
Ramya Krishnan-AniL
Head, Media Relations & Web Management
Phone: +91-22-6758 8051
Mobile: +91 98203 42671

About CRISIL IPO grading
A CRISIL IPO grade represents CRISIL's overall assessment of the fundamentals of the issue concerned in relation to other listed equity securities in India. CRISIL IPO gradings are assigned on a five-point scale from 1 to 5, with CRISIL IPO grade 5 indicating strong fundamentals and CRISIL IPO grade 1 indicating weak fundamentals. A CRISIL IPO grade should not be construed to mean a comment on the price of the security concerned nor is it a recommendation to invest or not to invest in the graded security.

About CRISIL Research
CRISIL Research is India's largest independent, integrated research house. We leverage our unique, integrated research platform and capabilities spanning the entire economy-industry company spectrum to deliver superior perspectives and insights to over 500 domestic and global clients, through a range of subscription products and customised solutions.

We provide our clients with a vital competitive advantage in today's dynamic environment - 'Knowledge for Action.'

About CRISIL : CRISIL is India's leading Ratings, Financial News, Risk and Policy Advisory company. CRISIL's majority shareholder is Standard & Poor's, a division of The McGraw-Hill Companies and the world's foremost provider of independent credit ratings, indices, risk evaluation, investment research and data.

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A CRISIL IPO grading is a one-time exercise and reflects CRISIL's current opinion on the fundamentals of the graded equity issue in relation to other listed securities in India, and does not constitute an audit of the issuer by CRISIL. Every CRISIL IPO grading is based on information provided by the issuer or obtained by CRISIL from sources it considers reliable. CRISIL does not guarantee the completeness or accuracy of the information on which the grading is based. A CRISIL IPO grading is not a recommendation to buy / sell or hold the graded instrument; it does not comment on the market price or suitability for a particular investor.

CRISIL is not responsible for any errors and especially states that it has no financial liability whatsoever to the subscribers / users / transmitters / distributors of CRISIL IPO gradings. For information on any IPO grading assigned by CRISIL, please contact Client Servicing at 022 66913561 Email:

For more information on IPO grading please visit the following page on the SEBI website :