MIRA INFORM REPORT

Report Date :

11.05.2007

IDENTIFICATION DETAILS

Name :	HOUSE OF GEMS PTE LTD
Registered Office :	^545 Orchard Road, #08-06^, Far East Shopping Centre, Singapore - 238882
Country :	Singapore
Financials (as on) :	30.06.2006
Date of Incorporation :	^18/07/1986
Com. Reg. No.:	^198601496N
Legal Form :	^Exempt Pte Ltd
Line of Business :	Deal in all kinds of Jewelleries, Diamonds, Gems and Precious Stones

RATING & COMMENTS

MIRA’s Rating :

B

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small

Status :	Moderate
Payment Behaviour :	Slow
Litigation :	Clear

Subject Company

HOUSE OF GEMS PTE LTD

Line Of Business 

DEAL IN ALL KINDS OF JEWELLERIES, DIAMONDS, GEMS AND PRECIOUS STONES

Parent Company

--

Financial Elements

FY 2006

COMPANY

Sales : S$20,516,087

Networth : S$1,343,259

Paid-Up Capital : S$1,000,000

Net result : S$77,234

Net Margin(%) : 0.38

Return on Equity(%) : 5.75

Leverage Ratio : 15.75

COMPANY IDENTIFICATION

^{Subject Company: HOUSE OF GEMS PTE LTD}

^{Former Name: -}

^{Business Address: 545 ORCHARD ROAD}

^#08-06

^{FAR EAST SHOPPING CENTRE}

^{Town: SINGAPORE}

^{Postcode: 238882}

^{County: -}

^{Country: Singapore}

^{Telephone: 6732 2877}

^{Fax: 6235 1946}

^{ROC Number: 198601496N}

^{Reg. Town: -}

SUMMARY

^{All amounts in this report are in: SGD unless otherwise stated}

^{Legal Form: Exempt Pte Ltd}

^{Date Inc.: 18/07/1986}

^{Previous Legal Form: -}

^{Summary year: 30/06/2006}

^{Sales: 20,516,087}

^{Net worth: 1,343,259}

^{Capital: -}

^{Paid-Up Capital: 1,000,000}

^{Employees: Not Available}

^{Net result: 77,234}

^{Share value: -}

^{Auditor: RAMA & CO}

REFERENCES

^{Litigation: No}

^{Company status: TRADING}

^{Started: 18/07/1986}

PRINCIPAL(S)

^{SHETH RAJESH PRAVINCHANDRA S2647693C Director}

DIRECTOR(S)

^{MANISHA RAJESH SHETH S2741953D Director}

^{Appointed on: 26/02/1991}

^{Street: 75 MEYER ROAD}

^#21-01

^{HAWAII TOWER}

^{Town: SINGAPORE}

^{Postcode: 437901}

^{Country: Singapore}

^{CLIFFORD EMMANUEL GERMAIN S2191478I Company Secretary}

^{Appointed on: 25/11/1996}

^{Street: 33A SURIN AVENUE}

^{CHARLTON COURT}

^{Town: SINGAPORE}

^{Postcode: 535617}

^{Country: Singapore}

^{SHETH RAJESH PRAVINCHANDRA S2647693C Director}

^{Appointed on: 19/07/1986}

^{Street: 75 MEYER ROAD}

^#21-01

^{HAWAII TOWER}

^{Town: SINGAPORE}

^{Postcode: 437901}

^{Country: Singapore}

ACTIVITY(IES)

^{DIAMONDS - WHSLE Code:6450}

^{JEWELLERS - MFRS Code:12260}

^{BASED ON ACRA'S RECORD AS AT 07/05/2007}

^{1) WHOLESALE OF PERSONAL EFFECTS; WHOLES PERSONAL EFFECTS}

^{2) MANUFACTURE OF COSTUME JEWELLERY}

CHARGES

^{Date: 21/06/2003}

^{Comments: CHARGE NO: C200302910}

^{SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE: BNP PARIBAS}

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

BANKERS

^{BNP PARIBAS}

SHAREHOLDERS(S)

^{MANISHA RAJESH SHETH 500,000 Private Person}

^{Street: 75 MEYER ROAD}

^#21-01

^{HAWAII TOWER}

^{Town: SINGAPORE}

^{Postcode: 437901}

^{Country: Singapore}

^{SHETH RAJESH PRAVINCHANDRA 500,000 Private Person}

^{Street: 75 MEYER ROAD}

^#21-01

^{HAWAII TOWER}

^{Town: SINGAPORE}

^{Postcode: 437901}

^{Country: Singapore}

SUBSIDIARY(IES)

No Participation In Our Database

PAYMENT HISTORY AND EXPERIENCES

Trade Morality: AVERAGE

Liquidity: SUFFICIENT

Payments: SLOW

^{Trend: DOWNWARD}

^{Financial Situation: AVERAGE}

LITIGATION(S)

No Litigation In Our Database

FINANCIAL ELEMENTS

^{All amounts in this report are in: SGD unless otherwise stated}

^{Audit Qualification:"MILD" UNCERTAINTIES "MILD" UNCERTAINTIES "MILD" UNCERTAINTIES}

^{Date Account Lodged: 22/12/2006}

^{Balance Sheet Date: 30/06/2006 30/06/2005 30/06/2004}

^{Number of weeks: 52 52 52}

^{Consolidation Code: COMPANY COMPANY COMPANY}

^{--- ASSETS}

^{Tangible Fixed Assets: 14,905 3,462 1,588}

^{Investments 80,500 56,500 56,500}

^{Total Fixed Assets: 95,405 59,962 58,088}

^{Inventories: 13,075,662 13,334,849 14,806,740}

^{Receivables: 4,979,938 6,249,835 4,744,939}

^{Cash,Banks,Securities: 4,098,181 4,044,721 4,740,101}

^{Other current assets: 253,497 245,646 218,234}

^{Total Current Assets: 22,407,278 23,875,051 24,510,014}

^{TOTAL ASSETS: 22,502,683 23,935,013 24,568,102}

^{--- LIABILITIES}

^{Equity capital: 1,000,000 1,000,000 1,000,000}

^{Reserves: 24,000}

^{Profit & loss Account: 319,259 242,025 133,775}

^{Total Equity: 1,343,259 1,242,025 1,133,775}

^{Trade Creditors: 10,218,567 9,947,360 11,167,766}

^{Prepay. & Def. charges: 124,200 125,053 103,700}

^{Provisions: 12,760 - -}

^{Other Short term Liab.: 10,803,897 12,620,575 12,162,861}

^{Total short term Liab.: 21,159,424 22,692,988 23,434,327}

^{TOTAL LIABILITIES: 21,159,424 22,692,988 23,434,327}

PROFIT & LOSS ACCOUNT

^{Net Sales 20,516,087 26,104,711 24,617,949}

^{Purchases,Sces & Other Goods: 20,095,750 25,510,449 -}

^{Gross Profit: 420,337 594,262 592,738}

^{Result of ordinary operations - - 113,068}

^{NET RESULT BEFORE TAX: 89,244 108,250 -}

^{Tax: 12,010 - -}

^{Net income/loss year: 77,234 108,250 113,068}

^{Depreciation: 4,682 3,045 2,695}

^{Directors Emoluments: 208,400 208,680 188,680}

^{Wages and Salaries: 130,304 137,552 124,434}

^{Financial Income: 105,818 50,873 29,316}

RATIOS

^{30/06/2006 30/06/2005 30/06/2004}

^{Stock / Turnover(%): 0.64 0.51 0.60}

^{Net Margin(%): 0.38 0.41 0.46}

^{Return on Equity(%): 5.75 8.72 9.97}

^{Return on Assets(%): 0.34 0.45 0.46}

^{Net Working capital: 1247854.00 1182063.00 1075687.00}

^{Cash Ratio: 0.19 0.18 0.20}

^{Quick Ratio: 0.43 0.45 0.40}

^{Current ratio: 1.06 1.05 1.05}

^{Receivables Turnover: 87.38 86.19 69.39}

^{Leverage Ratio: 15.75 18.27 20.67}

^{Net Margin: (100*Net income loss year)/Net sales}

^{Return on Equity: (100*Net income loss year)/Total equity}

^{Return on Assets: (100*Net income loss year)/Total fixed assets}

^{Net Working capital: (Total current assets-Total short term liabilities)}

^{Cash Ratio: Cash Bank securities/Total short term liabilities}

^{Quick Ratio: (Cash Bank securities+Receivables)/Total Short term liabilities}

^{Current ratio: Total current assets/Total short term liabilities}

^{Inventory Turnover: (360*Inventories)/Net sales}

^{Receivables Turnover: (Receivable*360)/Net sales}

^{Leverage Ratio: Total liabilities/(Total equity-Intangible assets)}

FINANCIAL COMMENTS

^{AUDITORS REPORT}

^{AS STATED IN THE FINANCIAL STATEMENTS, INVENTORIES OF S$13,075,662 ARE STATED IN THE FINANCIAL STATEMENTS BASED ON DIRECTORS ESTIMATE OF THE LOWER OF COST AND NET REALISABLE VALUE. OWING TO THE NATURE OF THE COMPANY'S INVENTORIES, WE WERE UNABLE TO ASCERTAIN THE VALUATION OF THE INVENTORIES AS STATED IN THE FINANCIAL STATEMENTS AS AT 30 JUNE 2006.}

^{THE FINANCIAL CONDITION OF THE COMPANY WAS SEEN TO BE FAIR IN VIEW OF THE FOLLOWING:}

^{NET WORTH:}

^{THE BALANCE SHEET WAS CONSIDERED PASSABLE WITH NET WORTH IMPROVED BY 8.15% FROM S$1,242,025 IN 2005 TO S$1,343,259 IN 2006.}

^{THIS WAS DUE TO HIGHER ACCUMULATED PROFITS OF S$319,259 (2005: S$242,025); A RISE OF 31.91% FROM THE PRIOR FINANCIAL YEAR.}

^LEVERAGE:

^{TRADE CREDITORS ROSE BY 2.73% TO S$10,218,567 (2005: S$9,947,360), AND CONSIST OF THE FOLLOWING:}

^{-RELATED PARTY - 2006: S$2,487,625 (2005: S$2,487,625)}

^{-OUTSIDE PARTIES - 2006: S$7,676,214 (2005: S$7,355,670)}

^{-GST PAYABLES - 2006: S$54,728 (2005: S$104,065)}

^{SUBJECT DID NOT INCUR ANY LONG TERM LIABILITIES DURING THE FINANCIAL YEAR UNDER REVIEW.}

^{IN ALL, LEVERAGE RATIO FELL FROM 18.27 TIMES TO 15.75 TIMES AS A RESULT OF A RISE IN TOTAL EQUITY AND A FALL IN TOTAL LIABILITIES.}

^LIQUIDITY:

^{IN GENERAL, SUBJECT'S LIQUIDITY SITUATION WAS PASSABLE AS SEEN FROM THE RISE IN NET WORKING CAPITAL BY 5.57% TO S$1,247,854 (2005: S$1,182,063).}

^{CURRENT RATIO ROSE TO 1.06 TIMES, UP FROM 1.05 TIMES BUT QUICK RATIO DECREASED TO 0.43 TIMES FROM 0.45 TIMES IN 2005.}

^{PROFITABILITY:}

^{REVENUE POSTED A DECREASE OF 21.41% FROM S$26,104,711 IN 2005 TO S$20,516,087 AND NET PROFIT DROPPED BY 28.65% TO S$77,234 (2005: S$108,250).}

^{THIS COULD BE DUE TO LOWER GROSS MARGIN OF 2.05% IN 2006 (2005: 2.28%).}

^{HENCE, NET MARGIN FELL TO 0.38% (2005: 0.41%).}

^{DEBT SERVICING:}

^{DEBT SERVICING PROBLEMS MIGHT NOT BE EXPECTED IF REVENUE AND EARNINGS CAN BE MAINTAINED AND PAYMENT BY TRADE DEBTORS ARE FORTHCOMING. IN ADDITION, SUBJECT DID NOT INCUR ANY INTEREST EXPENSES DURING THE FINANCIAL YEAR UNDER REVIEW.}

^{NOTES TO THE FINANCIAL STATEMENTS:}

^{CONTINGENT LIABILITIES}

^{AS AT 30 JUNE 2006, THE COMPANY HAS CONTINGENT LIABILITIES RELATING TO DEBTORS BY GUARANTEES AND SHIPPING GUARANTEES AMOUNTING TO S$301,378 - EQUIVALENT TO US$190,384 (2005: S$255,115 - EQUIVALENT TO US$151,242) RESPECTIVELY.}

^{LIMITED EXEMPT PRIVATE COMPANY:}

^{WHERE THE SHARES OF A PRIVATE COMPANY ARE NOT OWNED BY ANY CORPORATE BODY AND THERE ARE NO MORE THAN 20 MEMBERS, THE PRIVATE COMPANY IS KNOWN AS AN EXEMPT PRIVATE COMPANY.}

^{AN EXEMPT PRIVATE COMPANY ENJOYS A GREATER AMOUNT OF PRIVACY THAN A PRIVATE COMPANY. IT IS NOT REQUIRED TO FILE ACCOUNTS WITH THE REGISTRAR IF IT CAN PRODUCE A CERTIFICATE SIGNED BY ONE OF ITS DIRECTORS, SECRETARY AND AUDITOR CONFIRMING THE FOLLOWING POINTS:}

^{1. THE COMPANY IS AN EXEMPT PRIVATE COMPANY.}

^{2. THE AUDITED ACCOUNTS HAVE BEEN TABLED BEFORE THE SHAREHOLDERS AT THE ANNUAL}

^{GENERAL MEETING.}

^{3. THE COMPANY IS ABLE TO MEET ITS LIABILITIES.}

^{THERE IS THEREFORE NO DISCLOSURE TO THE PUBLIC OF THE ACCOUNTS OF THE COMPANY ALTHOUGH THE ACCOUNTS STILL HAVE TO BE AUDITED EVERY YEAR AND APPROVED AT AN ANNUAL GENERAL MEETING OF THE COMPANY.}

^{A PRIVATE COMPANY THAT IS WHOLLY OWNED BY THE GOVERNMENT MAY BECOME AN EXEMPT PRIVATE COMPANY IF THE MINISTER FOR FINANCE, IN THE NATIONAL INTEREST, DECLARES IT TO BE SUCH BY A GAZETTE NOTIFICATION.}

^{EXEMPT FROM AUDIT}

^{AN EXEMPT PRIVATE COMPANY IS EXEMPT FROM AUDIT REQUIREMENTS IF THE STARTING DATE OF ITS FINANCIAL YEAR IS BETWEEN 15 MAY 2003 AND 31 MAY 2004 AND ITS TURNOVER FOR THAT FINANCIAL YEAR DOES NOT EXCEED $2.5 MILLION. FOR FINANCIAL YEARS STARTING 1 JUNE 2004, THE AMOUNT OF THE TURNOVER HAS BEEN RAISED TO $5 MILLION. THESE COMPANIES ARE STILL REQUIRED TO MAINTAIN PROPER ACCOUNTING.}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 18/07/1986 AS A LIMITED EXEMPT PRIVATE COMPANY AND IS TRADING UNDER ITS PRESENT NAMESTYLE OF "HOUSE OF GEMS PTE LTD".}

^{AS AT 07/05/2007, THE COMPANY HAS ISSUED AND PAID-UP CAPITAL OF 1,000,000 SHARES OF A VALUE OF S$1,000,000.}

^{PRINCIPAL ACTIVITIES:}

^{SUBJECT IS REGISTERED WITH THE ACCOUNTING AND CORPORATE REGULATORY AUTHORITY (ACRA) AND BE PRINCIPALLY ENGAGED IN THE BUSINESS OF:}

^{1) WHOLESALE OF PERSONAL EFFECTS; WHOLES PERSONAL EFFECTS}

^{2) MANUFACTURE OF COSTUME JEWELLERY}

^{FROM THE FINANCIAL YEAR UNDER REVIEW, THE PRINCIPAL ACTIVITIES OF THE COMPANY WAS TO DEAL IN ALL KINDS OF JEWELLERIES, DIAMONDS, GEMS AND PRECIOUS STONES.}

^{FROM THE RESEARCH DONE, SUBJECT IS LISTED ON THE LOCAL DIRECTORIES UNDER THE CATEGORY OF "DIAMONDS".}

^{SUBJECT ENGAGES IN THE FOLLOWING ACTIVITIES:}

^{* WHOLESALE TRADING OF JEWELLERIES (EG DIAMONDS)}

^{* IMPORT AND EXPORT OF VALUABLE STONES}

^{NUMBER OF EMPLOYEES:}

^{* 5}

^{SUBJECT IS A MEMBER OF THE FOLLOWING ENTITIES:}

^{* WORLD FEDERATION OF DIAMOND BOURSES}

^{* SINGAPORE JEWELLERS ASSOCIATION}

^{NO OTHER TRADE INFORMATION WAS MADE AVAILABLE AT THE TIME OF THIS REPORT.}

^{NUMBER OF EMPLOYEES; INCLUDING DIRECTORS (30 JUNE):}

^{* COMPANY - 2006: NOT AVAILABLE (2005: 5; 2004: 6, 2003: 6, 2002: 6)}

^{REGISTERED AND BUSINESS ADDRESS:}

^{545 ORCHARD ROAD}

^#08-06

^{FAR EAST SHOPPING CENTRE}

^{SINGAPORE 238882}

^{DATE OF CHANGE OF ADDRESS: 09/04/1999}

^WEBSITE:

^NIL

^EMAIL:

^{hog@pacific.net.sg}

MANAGEMENT

^{THE DIRECTORS AT THE TIME OF THIS REPORT ARE:}

^{1) SHETH MANISHA RAJESH, AN INDIAN}

^{- BASED IN SINGAPORE}

^{2) SHETH RAJESH PRAVINCHANDRA, A SINGAPORE PERMANENT RESIDENT}

^{- HOLDS NO OTHER DIRECTORSHIPS AS RECORDED IN OUR DATABASE.}

Singapore’s Country Rating 2006

Investment Grade

IN SINGAPORE, THE POLITICAL SITUATION APPEARS TO BE VERY STABLE.

ECONOMIC GROWTH IS BECOMING MORE MODERATE AS INVESTMENT HAS BEEN FLAT DUE TO INCREASING OIL PRICES AND LESS BUOYANT DEMAND FOR ELECTRONIC PRODUCTS.

ECONOMIC PERFORMANCE HAS REMAINED STRONG, UNDERPINNED BY PHARMACEUTICALS AND SERVICES. EXPORTS HAS BENEFITED FROM THE STEADINESS OF DEMAND FROM ITS MAIN TRADING PARTNERS, MALAYSIA, THE UNITED STATES, CHINA AND HONG KONG. OTHER THAN ITS BALANCED PUBLIC SECTOR ACCOUNTS, LIMITED FOREIGN DEBT AND COMFORTABLE FOREIGN CURRENCY RESERVES HAVE CONTRIBUTED TO SINGAPORE’S STRONG FINANCIAL CONDITION.

AS THE ELECTRONICS SECTOR FACES COMPETITION FROM THE ASIAN ECONOMIES, SINGAPORE HAS BEEN PURSUING DIVERSIFICATION STRATEGY THAT HAS BEEN CONSOLIDATING ITS POSITION. PHARMACEUTICALS ALREADY REPRESENT 10% OF EXPORTS IN COMPARATIVE TO ITS INSIGNIFICANT CONTRIBUTION IN YEAR 1995. ELECTRONICS SECTOR SECTOR’S SHARE HAS DECLINED FROM 80% TO 60% DURING THE SAME PERIOD. THERE IS HIGH RELIANCE ON DEVELOPMENT OF PETROCHEMICAL PRODUCTS, HIGH VALUE-ADDED SERVICES AND BIOTECHNOLOGIES.

ASSETS

• ONE OF THE MOST OPEN ECONOMIES IN THE WORLD WITH EXPORTS PLAYING A MAJOR ROLE IN ITS PERFORMANCE.
• ONE OF ASIA’S MOST ADVANCED COUNTRIES IN QUALITY COMPETITIVENESS TERMS.
• WORKFORCE’S EDUCATION AND SKILL LEVEL IS VERY HIGH.
• A MAJOR EXPORT OF CAPITAL IN ASIA, PARTICULARLY THE STATE-OWNED HOLDING COMPANY, TEMASEK.
• THE BUSINESS ENVIRONMENT HAS BEEN VERY FAVOURABLE.
• GREAT POLITICAL STABILITY.

WEAKNESSES

• ECONOMY REMAINED OVERSPECIALISED IN THE ELECTRONICS SECTOR.
• MUST ACCELERATE DIVERSIFICATION IN SERVICES TO MAINTAIN ITS LEAD OVER OTHER ASIAN ECONOMIES
• REFORMS ARE STILL NEEDED TO FOSTER INNOVATION AND EDUCATION-SYSTEM MODERNIZATION.
• AGING POPULATION COULD ULTIMATELY AFFECT ECONOMIC PERFORMANCE.

WHOLESALE AND RETAIL TRADE SECTOR

PAST PERFORMANCE

DOMESTIC WHOLESALE TRADE INDEX

DOMESTIC WHOLESALE TRADE IN 4Q 2006 HAS DECLINED BY 6.9%. EXCLUDING PETROLEUM, DOMESTIC SALES REMAINED AT SIMILAR LEVEL COMPARED TO THE PREVIOUS QUARTER.

GENERAL WHOLESALE TRADE POSTED THE LARGEST SALES DECREASE OF 16.6%, FOLLOWED BY THE SECTORS OF PETROLEUM AND PETROLEUM PRODUCTS OF 15.7% AND HOUSEHOLD EQUIPMENT AND FURNITURE OF 13.2%.

SECTORS OF INDUSTRIAL AND CONSTRUCTION MACHINERY AND ELECTRONIC COMPONENTS REGISTERED GROWTHS OF 17.0% AND 12.3%, RESPECTIVELY.

FOREIGN WHOLESALE TRADE INDEX

ON A QUARTER-TO-QUARTER BASIS, OVERALL FOREIGN WHOLESALE TRADE CONTRACTED BY 7.9% IN 4Q 2006 AFTER TWO QUARTERS OF POSITIVE GROWTH. FOREIGN SALES WENT DOWN BY 1.6%, EXCLUDING PETROLEUM.

THE SECTORS OF PETROLEUM AND PETROLEUM PRODUCTS AND ELECTRONIC COMPONENTS MARKED LOWER OVERSEAS SALE OF 14.2% AND 11.6% RESPECTIVELY IN 4Q 2006 OVER 3Q 2006.

RETAIL TRADE

IN GENERAL, RETAIL SALES GREW BY 7.9% IN 4Q 2006, UP FROM THE 5.2% IN THE PREVIOUS QUARTER. THIS BROUGHT FULL YEAR GROWTH FOR 2006 TO 6.9%, DOWN FROM 9.0% IN 2005. EXCLUDING MOTOR VEHICLE SALES, RETAIL SALES ROSE 4.1%, SLOWING FROM THE 7.2% GAIN IN THE PREVIOUS YEAR.

MOST RETAIL SECTORS REPORTED BRISK BUSINESS IN DEC. 2006. SALES OF RECREATIONAL GOODS, DEPARTMENT STORES, WEARING APPAREL AND FOOTWEAR, FURNITURE AND HOUSEHOLD EQUIPMENT, WATCHES AND JEWELLERY CLIMBED BY 36.6% TO 44.2% IN DEC. 2006 COMPARED TO THE PREVIOUS MONTH.

LIKEWISE, RETAILERS OF OPTICAL GOODS AND BOOKS, TELECOMMUNICATIONS APPARATUS AND COMPUTERS, FOOD AND BEVERAGES, MEDICAL GOODS AND TOILETRIES AND SUPERMARKETS ENJOYED GROWTH BETWEEN 12.7% TO 26.0%.

OUTLOOK

FOR WHOLESALE TRADE, A NET WEIGHTED BALANCE OF 11% OF FIRMS ANTICIPATES BUSINESS TO BE LESS BRISK FOR COMING MONTHS. THOSE DEALING IN JEWELLERY AND WATCHES, INDUSTRIAL MACHINERY AND EQUIPMENT, TELECOMMUNICATIONS EQUIPMENT AND ELECTRONIC COMPONENTS ARE AMONG THOSE WHO FORESEE SLOWER BUSINESS IN THE COMING MONTHS.

FOR RETAILERS, A NET WEIGHTED BALANCE OF 8%, FORECAST THE BUSINESS CONDITIONS TO IMPROVE IN THE NEXT SIX MONTHS. DEPARTMENT STORES OWNERS AND RETAILERS OF FURNITURE AND FURNISHINGS ARE OPTIMISTIC ABOUT THE BUSINESS PROSPECTS.

EXTRACTED FROM: MINISTRY OF TRADE AND INDUSTRY, SINGAPORE

SINGAPORE DEPARTMENT OF STATISTICS

TODAY

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%)

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