MIRA INFORM REPORT

Report Date :

3^rd March, 2007

IDENTIFICATION DETAILS

Name :	KOREA KUMHO PETROCHEMICAL CO., LTD.

Registered Office :	57, Sinmunno 1-ga, Jongno-gu, Seoul, Korea.

Country :	Korea

Financials (as on) :	30.09.2006

Date of Incorporation :	28.12.1970

Legal Form :	Listed Company

Line of Business :	Manufacture of Synthetic Resin and Other Plastic Materials.

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Good

Payment Behaviour :	Regular

Litigation :	Clear

Basic Information

Company Name	KOREA KUMHO PETROCHEMICAL CO., LTD.
Address	57, Sinmunno 1-ga, Jongno-gu, SEOUL, KOREA
Building	16th Fl., Kumho Bldg.
Zip Code	110-713
Tel	+82-2-6303-3114
Fax	+82-2-6303-3329
E-mail	webmaster@kkpc.com;imskim@kkpc.com
Website	www.kkpc.com
Other Address	680, Sanggae-Dong, Nam-Gu, Ulsan, Korea
Tel	+82-52-259-6114
Fax	+82-52-275-6547
Yeosu Factory (Synthetic Rubber)	287-1, Pyeongyeo-dong, Yeosu-si, JEOLLANAM-DO, KOREA
Tel	+82-61-688-3000
Fax	+82-61-688-3166
Yeosu Factory (Rubber Chemicals)	356, Hwachi-dong, Yeosu-si, JEOLLANAM-DO, KOREA
Tel	+82-61-688-3920
Fax	+82-61-685-5806
Ulsan Factory (Synthetic Resins)	45-25, Seongnam-Dong, Nam-Gu, Ulsan, Korea
Tel	+82-52-279-8600
Fax	+82-52-273-1148
Electronic Materials Division	604, Namseong 1-ri, Sinchang-myeon, Asan-si, CHUNGCHEONGNAM-DO, KOREA
Tel	+82-41-532-8657
Fax	+82-41-532-8659
KKPC R&BD Center	57-1, Hwaam-Dong 1-Ga, Useong-Gu, Daejeon, Korea
Tel	+82-42-865-8600
Fax	+82-42-862-5651
Type	Export/Import
Industry	Manufacture of Synthetic Rubber
Main Business	Latex, Polystyrene, Expanded Polystyrene Foam, Polyprophylene Glycol
Sub Business	Manufacture of Synthetic Resin and Other Plastic Materials
Established	12/28/1970

Detailed Products

Activity	Detailed Products (UNSPSC)
Sell	Additives(12160000)
Sell	Styrene acrylonitrile resin(13111026)
Sell	Resins(13111000)
Sell	Polybutadiene BR(13101719)
Sell	Elastomers(13101700)
Sell	Styrene butadiene SBR(13101705)
Sell	Anti oxidants(12162200)
Sell	Acrylonitrile butadiene NBR(13101701)
Sell	Thermoplastic plastics(13102000)
Sell	Acrylonitrile butadiene styrene resin(13111004)
Sell	Chemicals including Bio Chemicals and Gas Materials
Buy	BD(Butadiene)
Buy	SM(Styrene Monomer)

Others

Name	Park Chan-Koo
Address	-
Date of Birth	08/13/1945
Title	Chairman & CEO
Sex	Male
Nationality	Korean
Capital	142,239,665,000 KRW
Employees	916
Formation	Listed Company (KSE : 011780 ), A company of Kumho Asiana Group

Since its establishment in 1970, The Subject, Korea's only synthetic rubber manufacturer, has been the producer and reliable provider of synthetic rubber, the main raw material of tires, footwear, etc.

Management

Job Description	Title	Name	Nationality	Date of Birth	Education
Group Chairman & CEO	Mr.	Park Sam-Koo	Korean	48.03.19	Ohio University, USA
Chairman & CEO	Mr.	Park Chan-Koo	Korean	45.08.13	Yonsei University
President & CEO	Mr.	Kim Heung-Ki	Korean	46.12.15	Yonsei University
President & CEO	Mr.	Kim Wan-Jae	Korean	46.04.12	Hanyang University
Outside Director	Mr.	Kim Kwang-Doo	Korean	47.08.05	Hawaii University
Outside Director	Mr.	Lee Soo-Kil	Korean	40.09.29	Seoul National University
Outside Director	Mr.	Kim Young-Il	Korean	45.01.25	Yonsei University
Outside Director	Mr.	Min Seung-Ki	Korean	48.04.28	Yonsei University

Financials

Unit: KRW

Year	Sales	Assets	Net income
2005	1,709,311,674,769	1,973,569,879,865	121,408,851,727
2004	1,507,747,920,038	1,626,702,597,163	134,469,476,517
2003	1,198,939,587,721	1,415,344,107,691	21,013,673,907

Financial Description

Unit: KRW

Authorized Capital

250,000,000,000

Paid-Up Capital

142,239,665,000

Total Issues Shares

28,447,933

Balance Sheet Unit : Thousand Korean Won

As of 09/30/2006

As of 12/31/2005

As of 12/31/2004

Total Assets

2,294,705,331

1,973,569,880

1,626,702,597

Current Assets

602,078,852

608,107,253

366,724,660

-Quick Assets

402,649,814

401,163,423

160,253,155

-Inventories

199,429,038

206,943,831

206,471,505

Fixed Assets

1,692,626,479

1,365,462,627

1,259,977,937

-Investment

1,090,413,777

776,443,904

730,400,036

-Tangibles

558,312,671

547,346,943

488,892,366

-Intangibles

43,900,030

41,671,780

40,685,535

Total Liabilities

1,496,767,780

1,133,050,049

907,627,556

Current Liabilities

678,850,719

539,643,814

501,830,120

Fixed Liabilities

817,917,062

593,406,235

405,797,436

Capital Stock

142,239,665

Capital Surplus

303,449,200

303,527,600

Profit Surplus

318,177,187

257,961,591

148,104,116

Capital Adjustment

34,071,498

136,869,375

125,203,661

Total Equity

797,937,550

840,519,831

719,075,042

Liab. & Shareholder’s Equity

2,294,705,331

1,973,569,880

1,626,702,597

Income Statement Unit : Thousand Korean Won

As of 09/30/2006

As of 12/31/2005

As of 12/31/2004

Sales

1,347,179,783

1,709,311,675

1,507,747,920

Cost of Sold Goods

1,180,498,298

1,463,247,631

1,268,132,065

Gross Profit

166,681,484

246,064,043

239,615,855

Selling & Admin. Expenses

95,824,411

125,682,499

124,967,072

Operating Income

70,857,073

120,381,545

114,648,783

Non-Operating Income

116,308,424

109,626,216

139,955,649

Non-Operating expenses

78,966,426

70,146,056

90,045,123

Ordinary Income

108,199,071

159,861,704

164,559,309

Special Income

Income Before Taxes

108,199,071

159,861,704

164,559,309

Income Taxes Expenses

25,880,894

38,452,852

30,089,832

Net Income

82,318,177

121,408,852

134,469,477

Bank Details

Woori Bank

Jongro Branch

Corporate Registered No.

110111-0205975

Business Registered No.

102-81-31147

Permit & Licenses

05/1994 ISO 9001

08/1995 ISO 14001

Shareholder Position

Name	Shares	%
Park Chu-Wan and Family(5)	10,511,252	36.95
CRMC	1,919,150	6.75
SSB-SMALL CAP	1,810,940	6.37
Others	14,206,591	49.93
Total	28,447,933	100.00

Company History

Dec 2005 2005 Received the Korea Management Awards

Nov. 2005 Received the Tower of US$1 Billion Export Award

Aug. 2004 Overseas office opened in LA, U.S.A.

Jun. 2004 Received the Environment Management Award.(Ministry of Commerce, Industry and Energy.)

Aug. 2003 Kumho Chemical Laboratory and Yicheon Laboratory merged into Kumho Petrochemical R&D Center.

Jun. 2003 Received the Environment Management Award.

Nov. 2002 Overseas office opened in Frankfurt, Germany.

Oct. 2002 Overseas office opened in Guangzhou, China.

Jan. 2002 Took over chemical business division of Kumho Development, Inc.

Jan. 2001 Merged with Kumho Chemicals, Inc.

Oct. 2000 Shanghai Kumho Sunny Plastics Co., Ltd. established.

Aug. 2000 OHSAS 18001 certification acquired.

Jun. 2000 Recognized among the top 50 companies with superior quality competitiveness.

Aug. 1999 Recognized among the top 50 companies with superior quality competitiveness.

Nov. 1998 Asan plant (Electronic materials division) launched.

Jul. 1997 Overseas subsidiary established in LA, U.S.A.

Jul. 1997 Combined heat & power plant in Yeosu built.

Mar. 1997 Kumho Chemicals, Inc. enlisted as an affiliated company.

Mar. 1997 Contact of introducing Polycarbonate technology.

Dec. 1996 Designated as an environmentally friendly company.

Aug. 1995 ISO 14001 certification acquired.

Mar. 1995 Opended Kumho Life & Environmental Science Laboratory in Gwangju.

Oct. 1994 Plastic compounding technology introduced.

Aug. 1994 Thermoplastic elastomer (SBS) production started.

May. 1994 ISO 9001 certification acquired.

Feb. 1994 Kumho Chemical Laboratories opened in Daedeok Technovalley.

May. 1993 Overseas office in Jakarta, Indonesia opened.

May. 1992 Established BD plant.(Ulsan 50,000MT)

Aug. 1990 UC Plant in Yeosu launched.

Mar. 1989 Kumho Mitsui Chemicals, Inc. established.

Dec. 1988 Multi-purpose BR plant launched.

Dec. 1987 Korea Kumho Petrochemical Co., Ltd. shares offered publicly.

Nov. 1987 Kumho P&B Chemical, Inc. established.

Nov. 1987 Kumho Monsanto, Inc. established.

Jun. 1985 Kumho Polychem Co., Ltd. established.

Jun. 1985 Kumho Petrochemical Research Center established.

Jun. 1985 Korea Synthetic Rubber Industries Co., Ltd. and Korea Kumho Chemicals, Inc. merged.

Company name changed to Korea Kumho Petrochemical Co., Ltd.

Mar. 1984 SBR Latex plant launched. (Ulsan)

Dec. 1983 NBR production initiated.

Aug. 1982 HSR production initiated.

Mar. 1980 BR plant launched. (Yeosu 25,000MT)

Oct. 1979 BD plant launched. (Yeosu 50,000MT)

Jun. 1973 Sales started.

Apr. 1973 SBR plant launched. (Ulsan 25,000MT)

Dec. 1970 Korea Synthetic Rubber Industries Co., Ltd. established.

Products, Technologies, Services Description

Main Products & Services

Synthetic Rubber

BR, SBR, LBR, S-SBR, NBR, HSR, TPE, SBR Latex, PAG

Synthetic Plastics

ABS, PS, EPS, SAN, PPG

Rubber Chemicals

Antiaxidant, Vulcanization Accelerator, Others

Electronic Chemicals

Stripper, Photoregist, BARC, PAG

Brand Name: KOSYN, KUMANOX, KUMAC, Barc

Production Capacity

(Thousand M/T)

Products	2005	2004
Synthetic Rubber	529	460
Synthetic Plastics	600	501
SB-LATEX	70	70
BD	237	227
Rubber Chemicals	26	21
Others	2,442	1,808

Technologies Acquired

Trade Partners

Customers

Synthetic Rubber: Paper Manufacturer, Carpet Manufacturers

Synthetic Plastics: Electric/Electronics Parts Manufacturers, Car Manufacturers, Construction Companies

Rubber Chemicals: Tire Manufacturers, Rubber/ Synthetic Rubber Parts Manufacturers

Sales Channel

Domectic : Factory → End-User (Tire, Shoe Manufacturers)

Export :

Direct : Factory → Overseas End-User (Master L/C)

Local : Factory → Overseas End-User (Local L/C)

Conditions

Domestic : Chas & Credit

Export : Irrevocable L/C Base, T/T

Competitors

The subject is ranked as the 1st player in Synthetic Rubber in terms of domestic market share.

Related Parties (Subsidiaries, Joint-Venture & Affiliates)

Affiliates

Total 25 companies

KUMHO POLYCHEM CO.,LTD. (110111-0400533)

KUMHO MITSUI CHEMICALS, INS. (110111-0612980)

Kumho P&B Chemicals, INC. (206211-0018313)

KUMHO INDUSTRIAL CO.,LTD (110111-0134877)

KUMHO RENT-A-CAR.INC (110111-0513253)

Asiana Leisure Co., Ltd (110111-0773552)

KUMHO RESORT CO., LTD (134511-0105856)

Asiana Airline Inc. (110111-0562804)

Korea Integrated Freight Terminal CO.,LTD (110111-0853576)

Honam Integrated Freight Terminal Co.,LTD (135111-0054050)

Jung-bu Integrated Freight Terminal Co.,LTD. (110111-3284158)

KUMHO TRADING CO., INC. (110111-2079641)

Seoul Express Bus Terminal

Kumho Terminal

AsianaIDT,Inc. (110111-0801848)

Asiana Abacus , Inc. (110111-3010925)

Asiana Airport Development Co., Ltd. (110111-1412496)

INCHEON AIRPORT ENERGY CO.,LTD. (110111-1415408)

Kumho PFV1

Kumho PFV1 Assets Management

Chungjuboramae co., Ltd. (110111-3348524)

Kumho Investment Bank (200111-0000954)

Kumho Life Insurance Co., Ltd. (200111-0014608)

KUMHO TIRE CO., INC. (110111-2810590)

Overseas Office

Jakarta Office

Shenzhen Office
Guangzhou Office

Shanghai Office

LA Office

Sales by Region (Activity & Markets)

Sales/ Unit :Mil KRW	2005	2004	2003
Export	949,551	813,845	617,947
Domestic	759,761	693,903	580,993
Total	1,709,312	1,507,748	1,198,940

The Subject deals with the companies in USA, Asia and Europe.

Synthetic Rubber : The subject exports to South East Asia, USA, China, Middle East and Europe.

Synthetic Plastics : The Subject exports to USA, China and Europe.

Court Action

Case No.	Court	Plaintiff(s)/ Creditor(s)/ Applicant(s)	Defendant(s)/ Debtor(s)/ Respondent(s)	Cause	Amount (Million KRW)	Status
02/15/2005		Plexis America LP	The Subject and others(4)	Infringement of patent	U$20,000,000	Proceeding

News Clipping

Kumho Petrochemical Raises Stakes in Subsidiaries

KOREA TIMES: 02-12-2006

By Kim Yon-se /Staff Reporter

Kumho Asiana Group is restructuring its cross-unit shareholding structure in a move to create a holding firm of the group.

Kumho Petrochemical is expected to emerge as the holding firm of Kumho Asiana Group as it is actively purchasing stakes in affiliates, analysts said.

Last Friday, Kumho Industrial sold its 32.14-percent stake in Kumho Tires, or 22.6 million shares worth 340 billion won to Kumho Petrochemical.

The petrochemical unit has already played as the de facto holding firm of Kumho Asiana under group chairman Park Sam-koo’s commitment to the revamping of the intra-group shareholding structure.

Kumho Petrochemical holds a 42.49 percent stake in Kumho Industrial, 49.51 percent in Kumho Rent-A-Car, 31.74 percent in Kumho Life Insurance, 14.61 percent in Asiana Airlines and 39.7 percent in Kumho P&B.

Chairman Park and his families and relatives hold a 40.25 percent stake in the petrochemical unit.

Kumho Asiana Group is planning to take over Daewoo Engineering & Construction. Kumho Industrial, the construction unit of the group, is believed to have sold its stake in Kumho Tires to raise funds for its bid for Daewoo Engineering.

Kumho is one of the competitive potential buyers of Daewoo Construction placed in the auction market. Hanwha and Doosan Group are also competing to take over Daewoo Engineering.

The nation’s 10th largest group has announced its new corporate identity (CI) on the occasion of the 60th anniversary of the group’s foundation, and the new CI will be applied to all its affiliates.

The new symbol combines Kumho’s initial and Asiana’s image of wings with multicolored stripes. The color is red, which has always been used for the group’s CIs.

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
NR		In view of the lack of information, we have no basis upon which to recommend credit dealings	No Rating

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%)

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