MIRA INFORM REPORT

Report Date :

05.10.2007

IDENTIFICATION DETAILS

Name :	INGRAM MICRO SEMI CONDUCTOR ASIA PTE. LTD.
Registered Office :	^205 Kallang Bahru, #04-00, Singapore – 339341
Country :	Singapore
Financials (as on) :	31.12.2005
Date of Incorporation :	^18/05/1996
Com. Reg. No.:	^199603595R
Legal Form :	^Pte Ltd
Line of Business :	Offers Design Houses, International Procurement Offices and Oems a wide Choice of Semi-Conductors and Memory Products for the Information Technology Industry.

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.	Small

Status :	Moderate
Payment Behaviour :	Regular
Litigation :	Exists

Subject Company

INGRAM MICRO SEMI CONDUCTOR ASIA PTE. LTD.

Line Of Business 

OFFERS DESIGN HOUSES, INTERNATIONAL PROCUREMENT OFFICES AND OEMS A WIDE CHOICE OF SEMI-CONDUCTORS AND MEMORY PRODUCTS FOR THE INFORMATION TECHNOLOGY INDUSTRY

Parent Company

INGRAM MICRO ASIA LTD

(PERCENTAGE OF SHAREHOLDINGS: 100%)

Financial Elements

FY 2005

COMPANY

Sales : S$234,621,457

Networth : S$ -2,197,025

Paid-Up Capital : S$ 877,121

Net result : S$ 1,216,175

Net Margin(%) : 0.52

Return on Equity(%) : -55.36

Leverage Ratio : -25.26

COMPANY IDENTIFICATION

^{Subject Company : INGRAM MICRO SEMICONDUCTOR ASIA PTE. LTD.}

^{Former Name : INGRAM MICRO COMPONENTS ASIA PTE. LTD.}

^{Business Address : 205 KALLANG BAHRU}

^#04-00

^{Town : SINGAPORE}

^{Postcode : 339341}

^{Country : Singapore}

^{Telephone : 6298 0888}

^{Fax : 6298 1111}

^{ROC Number : 199603595R}

^{Reg. Town : -}

PREVIOUS IDENTIFICATION

INGRAM MICRO COMPONENTS ASIA PTE. L

INGRAM MICRO (S.E.A.) PTE LTD

INGRAM MICRO SINGAPORE PTE LTD

SUMMARY

^{Legal Form : Pte Ltd}

^{Date Inc. : 18/05/1996}

^{Previous Legal Form : -}

^{Summary year : 31/12/2005}

^{Sales : 234,621,457}

^{Networth : -2,197,025}

^{Capital : -}

^{Paid-Up Capital : 877,121}

^{Employees : 35}

^{Net result : 1,216,175}

^{Share value : 1}

^{AUDITOR : PRICEWATERHOUSECOOPERS}

REFERENCES

^{Litigation : YES}

^{Company status : TRADING}

^{Started : 18/05/1996}

PRINCIPAL(S)

^{LEONG KHAI MUN S1471316F Director}

DIRECTOR(S)

^{ONG BENG HONG S2621789Z Company Secretary}

^{Appointed on : 01/05/2000}

^{Street : 32 ALLAMANDA GROVE}

^{ALLAMANDA GROVE}

^{Town : SINGAPORE}

^{Postcode : 269978}

^{Country : Singapore}

^{LEONG KHAI MUN S1471316F Director}

^{Appointed on : 27/03/2005}

^{Street : 79 FARRER DRIVE}

^#12-02

^{SOMMERVILLE PARK}

^{Town : SINGAPORE}

^{Postcode : 259283}

^{Country : Singapore}

^{SEAN LEROY FORT 017368797 Director}

^{Appointed on : 08/12/2005}

^{Street : 21 ANGULLIA PARK}

^#04-01

^PARISIAN

^{Town : SINGAPORE}

^{Postcode : 239974}

^{Country : Singapore}

^{SHAILENDRA GUPTA S2729326C Director}

^{Appointed on : 11/12/2006}

^{Street : 9 NATHAN ROAD}

^#09-04

^{REGENCY PARK}

^{Town : SINGAPORE}

^{Postcode : 248730}

^{Country : Singapore}

^{LAI SIANG TUNG S7076201C Director}

^{Appointed on : 11/12/2006}

^{Street : 31 PAVILION RISE}

^{Town : SINGAPORE}

^{Postcode : 658666}

^{Country : Singapore}

FORMER DIRECTOR(S)

^{TONG KOK CHIANG S0175490D}

^{NG PENG TEA S0233712F}

^{NG EDE PHANG S1450962C}

^{CHAN WAI LEONG MELVIN S1524154C}

^{LIM KOON HOCK S2538901H}

^{RUTLEDGE DAVID 081523750}

^{FOO LAI FUAN 4165240}

^{LOW SOONG ING S7043002I}

^{HENRI THEODORUS KOPPEN BA0115523}

^{LAURENCE RICHARD O' LAUGHLIN 710247708}

^{KANWAL NAIN SAHNEY S2616608Z}

^{ALAIN MONIE 01RE44594}

^{GUY ANTHONY FREELAND L4630563}

ACTIVITY(IES)

^{COMPUTER SOFTWARE DEVELOPMENT And PACKAGES Code: 5095}

^{COMPUTER PERIPHERALS And ACCESSORIES-WHSLE And MFR Code: 5088}

^{BASED ON ACRA'S RECORD AS AT 15/08/2007}

^{1) WHOLESALE OF COMPUTER SOFTWARE (EXCEPT GAMES)}

^{2) WHOLESALE OF COMPUTER HARDWARE AND PERIPHERAL EQUIPMENT}

CHARGES

No Charges On Premises/Property In Our Database

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

BANKERS

^{ABN AMRO BANK N.V.}

^{OVERSEAS UNION BANK LIMITED}

^{UNITED OVERSEAS BANK LIMITED}

SHAREHOLDERS(S)

^{INGRAM MICRO ASIA LTD 1,455,144 Company}

^{Street : 205 KALLANG BAHRU}

^#04-00

^{Town : SINGAPORE}

^{Postcode : 339341}

^{Country : Singapore}

FORMER SHAREHOLDER(S)

^{KAN MUN LEONG EDDIE 1}

^{KIRPA RAM VIJ 1}

^{INGRAM MICRO SINGAPORE INC 1,455,144}

HOLDING COMPANY

^{INGRAM MICRO ASIA LTD 198302829C %: 100}

SUBSIDIARY(IES)

^{ERIM SDN BHD}

PAYMENT HISTORY AND EXPERIENCES

^{Trade Morality : AVERAGE}

^{Liquidity : LACKING}

^{Payments : REGULAR}

^{Trend : LEVEL}

^{Financial Situation : BAD}

LITIGATION(S)

^{Type Of Case : District Court - W/S P}

^{Case Number : DCS050450/97}

Defendant INGRAM MICRO SEMICONDUCTOR ASIA ROC #: 199603595R

FINANCIAL ELEMENTS

^{Audit Qualification: GOING CONCERN QUALIF GOING CONCERN QUALIF GOING CONCERN QUALIF}

^{Date Account Lodged: 23/08/2006}

^{Balance Sheet Date : 31/12/2005 31/12/2004 31/12/2003}

^{Number of weeks : 52 52 52}

^{Consolidation Code : COMPANY COMPANY COMPANY}

^{--- ASSETS ---}

^{Preliminary Exp 301,032 605,075}

^{Tangible Fixed Assets: 19,717 16,496 8,214}

^{Total Fixed Assets : 320,749 621,571 8,214}

^{Inventories : 12,617,005 14,178,032 49,948,084}

^{Receivables : 37,731,816 37,386,006 43,090,784}

^{Cash,Banks, Securities: 2,631,180 750,990 1,034,297}

^{Other current assets: 5,952 169,649 59,658}

^{Total Current Assets: 52,985,953 52,484,677 94,132,823}

^{TOTAL ASSETS : 53,306,702 53,106,248 94,141,037}

^{--- LIABILITIES ---}

^{Equity capital : 877,121 877,121 877,121}

^{Reserves : -4,405,567}

^{Profit & lost Account: -3,074,146 -4,290,321}

^{Total Equity : -2,197,025 -3,413,200 -3,528,446}

^{Trade Creditors : 29,992,539 30,179,481 70,029,963}

^{Prepay. & Def. charges: 971,325 534,391 770,928}

^{Other Short term Liab.: 24,539,863 25,805,576 26,868,592}

^{Total short term Liab.: 55,503,727 56,519,448 97,669,483}

^{TOTAL LIABILITIES : 55,503,727 56,519,448 97,669,483}

^{PROFIT & LOSS ACCOUNT}

^{Net Sales 234,621,457 295,575,333 355,362,878}

^{Purchases,Sces & Other Goods: 229,434,741 291,202,108}

^{Gross Profit : 5,186,716 4,373,225}

^{Result of ordinary operations 760,545}

^{NET RESULT BEFORE TAX: 1,520,218 -489,829 770,820}

^{Tax : 304,043 -605,075}

^{Net income/loss year: 1,216,175 115,246 770,820}

^{Interest Paid : 1,035 40,902}

^{Depreciation : 27,367 4,783 944}

^{Directors Emoluments: 234,895 261,605 202,830}

^{Wages and Salaries : 1,888,262 1,719,620 1,391,001}

^{Financial Income : 21,137 41,935 10,275}

RATIOS

^{31/12/2005 31/12/2004 31/12/2003}

^{Turnover per employee: 6703470.20 8445009.51 10153225.09}

^{Net result / Turnover(%): 0.01 0.00 0.00}

^{Stock / Turnover(%): 0.05 0.05 0.14}

^{Net Margin(%) : 0.52 0.04 0.22}

^{Return on Equity(%): -55.36 -3.38 -21.85}

^{Return on Assets(%): 2.28 0.22 0.82}

^{Net Working capital: -2517774.00 -4034771.00 -3536660.00}

^{Cash Ratio : 0.05 0.01 0.01}

^{Quick Ratio : 0.73 0.67 0.45}

^{Current ratio : 0.95 0.93 0.96}

^{Receivables Turnover: 57.90 45.53 43.65}

^{Leverage Ratio : -25.26 -16.56 -27.68}

^{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)/1000}

^{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:}

^{WITHOUT QUALIFYING OUR OPINION, WE DRAW ATTENTION TO NOTE 2(A) TO THE FINANCIAL STATEMENTS WHICH STATES THAT THE FINANCIAL STATEMENTS HAVE BEEN PREPARED ON A GOING CONCERN BASIS BECAUSE THE IMMEDIATE HOLDING COMPANY OF THE COMPANY HAS GIVEN ITS UNDERTAKING TO PROVIDE CONTINUING FINANCIAL SUPPORT TO THE COMPANY. IF THE FINANCIAL SUPPORT ID NOT FORTHCOMING AND AS A RESULT THE COMPANY IS UNABLE TO CONTINUE IN OPERATIONAL EXISTENCE FOR THE FORESEEABLE FUTURE, ADJUSTMENTS WOULD HAVE TO BE MADE TO REFLECT THE SITUATION THAT THE ASSETS MAY NEED TO BE REALISED OTHER THAN IN THE NORMAL COURSE OF BUSINESS AND AT AMOUNTS WHICH COULD DIFFER SIGNIFICANTLY FROM THE AMOUNTS STATED IN THE BALANCE SHEET. THE FINANCIAL STATEMENTS AND NOTES THERETO DO NOT INCLUDE DETAILS OF ANY ADJUSTMENTS THAT WOULD RESULT FROM ANY FAILURE BY THE IMMEDIATE HOLDING CORPORATION TO PROVIDE SUCH SUPPORT. THE FINANCIAL CONDITION OF THE COMPANY WAS SEEN TO BE LIMITED IN VIEW OF THE FOLLOWING:}

^{NET WORTH:}

^{THE BALANCE SHEET WAS CONSIDERED INADEQUATE WITH NEGATIVE NET WORTH DECLINING BY 35.63% FROM US$3,413,200 IN FY 2004 TO US$2,197,025 IN FY 2005. THIS WAS DUE TO LOWER ACCUMULATED LOSS OF US$3,074,146 (2004: US4,290,321); A DECLINE OF 28.35% FROM THE PRIOR FINANCIAL YEAR.}

^LEVERAGE:

^{IN THE SHORT-TERM, SUBJECT WAS LARGELY FINANCED BY TRADE CREDITORS WHICH MADE UP 54.04% (2004: 53.39%) OF THE TOTAL CURRENT LIABILITIES AND AMOUNTED TO US$29,992,539 (2004: US$30,179,481). IN ALL, LEVERAGE RATIO IS SUBSTANTIAL AT -25.26 TIMES.}

^LIQUIDITY:

^{IN GENERAL, SUBJECT'S LIQUIDITY SITUATION WAS WEAK AS SEEN FROM THE NET WORKING CAPITAL DEFICIT AND LOW LIQUIDITY RATIOS. CURRENT RATIO ROSE TO 0.95 TIMES, UP FROM 0.93 TIMES AND QUICK RATIO IMPROVED TO 0.73 TIMES FROM 0.67 TIMES IN FY 2004.}

^{NET WORKING CAPITAL DEFICIT FELL BY 37.59% FROM US$4,034,771 IN FY 2004 TO US$2,517,774.}

^{PROFITABILITY:}

^{REVENUE POSTED A DECLINE OF 20.62% FROM US$295,575,333 IN FY 2004 TO US$234,621,457 BUT NET PROFIT ROSE BY 9.55 TIMES TO US$1,216,175 (2004: US$115,246). THIS COULD BE DUE TO HIGHER GROSS MARGIN OF 2.21% IN FY 2005 (2004: 1.48%). HENCE, NET MARGIN ROSE TO 0.52% (2004: 0.04%).}

^{DEBT SERVICING:}

^{DEBT SERVICING PROBLEMS MIGHT BE EXPECTED WITH THE LOW LIQUIDITY AND NEGATIVE NET WORTH. IN ADDITION, THE SUBJECT HAS SUBSTANTIAL GEARING.}

^{NON-CURRENT ASSETS:}

^{THE FOLLOWING ITEMS ARE CLASSIFIED UNDER PRELIMINARY:}

^{-DEFERRED TAX ASSET - 2005: US$301,032 (2004: US$605,075)}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 18/05/1996 AS A LIMITED PRIVATE COMPANY AND IS TRADING UNDER ITS NAMESTYLE AS "INGRAM MICRO SINGAPORE PTE LTD".}

^{SUBSEQUENTLY, THE COMPANY CHANGED TO ITS NAMESTYLE AS "INGRAM MICRO (S.E.A.) PTE LTD".}

^{SUBSEQUENTLY, THE COMPANY CHANGED TO ITS NAMESTYLE AS "INGRAM MICRO COMPONENTS ASIA PTE. LTD.".}

^{FOLLOWING ON 14/02/2005, THE COMPANY CHANGED TO ITS PRESENT NAMESTYLE AS "INGRAM MICRO SEMICONDUCTOR ASIA PTE. LTD.".}

^{AS AT 15/08/2007, THE COMPANY HAS ISSUED AND PAID-UP CAPITAL OF 1,455,144 SHARES OF A VALUE OF S$1,455,144.}

^{PRINCIPAL ACTIVITIES:}

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

^{(1) WHOLESALE OF COMPUTER SOFTWARE (EXCEPT GAMES).}

^{(2) WHOLESALE OF COMPUTER HARDWARE AND PERIPHERAL EQUIPMENT}

^{DURING THE FINANCIAL YEAR UNDER REVIEW, THE PRINCIPAL ACTIVITIES OF THE COMPANY CONSIST OF THE DISTRIBUTION OF MICROCOMPUTER HARDWARE, SOFTWARE, ELECTRONIC COMPONENTS, COMPTER PERIPHERALS AND TELECOMMUNICATIONS EQUIPMENT.}

^{FROM THE RESEARCH DONE, THE FOLLOWING INFORMATION WAS GATHERED:}

^{BACKGROUND OF INGRAM MICRO ASIA LTD:}

^{INGRAM MICRO ASIA, IS A PART OF INGRAM MICRO INC., THE LARGEST GLOBAL WHOLESALE PROVIDER OF TECHNOLOGY SOLUTIONS, PRODUCTS AND SERVICES, REPRESENTING CLOSE TO 60 OF THE WORLD'S LEADING IT AND ELECTRONICS VENDORS. OUR EXTENSIVE PRODUCT OFFERINGS INCLUDE PERSONAL COMPUTER SYSTEMS, NOTEBOOKS, SERVERS, NETWORKING PRODUCTS, PRINTERS, SOFTWARE, OTHER HARDWARE AND PERIPHERALS, COMPUTER COMPONENTS, MEMORY AND A WIDE VARIETY OF SEMI-CONDUCTOR PRODUCTS.}

^{INGRAM MICRO SINGAPORE HAS CREATED 3 DIVISIONS TO MEET THE NEEDS OF MANUFACTURERS AND CUSTOMERS.}

^{COMPUTER COMPONENTS - BRINGS THE KEY COMPONENTS FROM LEADING VENDORS SUCH AS INTEL AND QUANTUM IN THE COURSE OF DEVELOPING COMPUTER SYSTEMS.}

^{SEMICONDUCTORS - OFFERS DESIGN HOUSES, INTERNATIONAL PROCUREMENT OFFICES AND OEMS A WIDE CHOICE OF SEMI-CONDUCTORS AND MEMORY PRODUCTS FOR THE INFORMATION TECHNOLOGY INDUSTRY}

^{SYSTEMS & PERIPHERALS - TAILORS COMPLETE TECHNOLOGY SOLUTIONS FOR CHANNEL PARTNERS FROM ITS EXTENSIVE RANGE OF PRODUCTS AND SERVICES RANGING FROM ENTERPRISE SOLUTIONS, NETWORKING & STORAGE SOLUTIONS TO APPLICATION SOFTWARE.}

^{IN ADDITION, INGRAM MICRO ASIA OFFERS THEIR BUSINESS PARTNERS EXCELLENT SUPPORT FROM OUR SALES, FINANCE, TECHNICAL, LOGISTICS, MARKETING AND PRODUCT TEAMS. AS AN INTEGRATED PART OF INGRAM MICRO GLOBAL OPERATIONS, WE LEVERAGE ON IMPULSE SYSTEM, OUR GLOBAL REAL-TIME ONLINE ELECTRONIC ORDERING AND INVENTORY TRACKING SYSTEM TO OFFER BUSINESS PARTNERS A GREAT WEALTH OF INFORMATION ALMOST INSTANTLY.}

^{SUBJECT ENGAGES IN THE FOLLOWING ACTIVITIES:}

^{* OFFERS DESIGN HOUSES, INTERNATIONAL PROCUREMENT OFFICES AND OEMS A WIDE CHOICE OF SEMI-CONDUCTORS AND MEMORY PRODUCTS FOR THE INFORMATION TECHNOLOGY INDUSTRY}

^{NO OTHER TRADE INFORMATION IS AVAILABLE AS TELE-INTERVIEW WAS NOT GRANTED BY SUBJECT'S PERSONNEL ON 04/10/2007.}

^{NUMBER OF EMPLOYEES (31 DECEMBER):}

^{* COMPANY - 2005: NOT AVAILABLE (2004: NOT AVAILABLE; 2003: 35; 2002: - )}

^{* GROUP - 2005: - (2004: - )}

^{THE COMPANY'S IMMEDIATE HOLDING COMPANY IS INGRAM MICRO ASIA LTD, INCORPORATED IN SINGAPORE. THE COMPANY'S ULTIMATE HOLDING CORPORATION IS INGRAM MICRO INC, INCORPORATED IN THE UNITED STATES OF AMERICA.}

^{REGISTERED AND BUSINESS ADDRESS:}

^{205 KALLANG BAHRU}

^#04-00

^{SINGAPORE 339341}

^{DATE OF CHANGE OF ADDRESS: 22/12/1997}

^{- OFFICE}

^{- PROPERTY RECORD WAS NOT AVAILABLE}

^{OTHER BUSINESS ADDRESS:}

^{40 CHANGI NORTH CRESCENT}

^{SINGAPORE 499639}

^{- WAREHOUSE}

^{WEBSITE : http://www.ingrammicro-asia.com}

^{EMAIL : vasu@ingrammicro-asia.com}

MANAGEMENT

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

^{1) SEAN LEROY FORT, AN AMERICAN}

^{- HOLDS OTHER DIRECTORSHIP(S) AS RECORDED IN OUR DATABASE:}

^{INGRAM MICRO (INDIA) EXPORTS PTE. LTD.}

^{2) LEONG KHAI MUN, A SINGAPOREAN}

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

^{3) SHAILENDRA GUPTA, AN INDIAN}

^{- HOLDS OTHER DIRECTORSHIP(S) AS RECORDED IN OUR DATABASE:}

^{TECH PACIFIC (SINGAPORE) LTD.}

^{FIRST TECH PACIFIC DISTRIBUTORS SDN BHD}

^{INGRAM MICRO (INDIA) EXPORTS PTE. LTD.}

^{4) LAI SIANG TUNG, A SINGAPORE PERMANENT RESIDENT}

^{- HOLDS OTHER DIRECTORSHIP(S) AS RECORDED IN OUR DATABASE:}

^{INGRAM MICRO ASIA LTD}

^{ACER COMPUTER INTERNATIONAL LTD}

^{ASTI HOLDINGS LIMITED}

^{INGRAM MICRO (INDIA) EXPORTS PTE. LTD.}

SINGAPORE’S COUNTRY RATING 2007

^{INVESTMENT GRADE}

^{IN SINGAPORE, THE POLITICAL SITUATION REMAINS STABLE.}

^{SINGAPORE BOASTS THE BEST GOVERNANCE IN ASIA, WITH AN EFFECTIVE LEGAL SYSTEM FACILITATING DEBT COLLECTION AND TO A HIGH DEGREE OF FINANCIAL TRANSPARENCY.}

^{EXTERNAL ACCOUNTS HAVE REMAINED SUBSTANTIALLY IN SURPLUS, CONTRIBUTED TO THE DYNAMISM OF THE ELECTRONICS AND PHARMACEUTICALS SECTORS AND TO REPATRIATION OF PROFITS FROM SINGAPORE INVESTMENTS. THE FINANCIAL AND TOURISM SECTORS HAVE ALSO CONTRIBUTED TO THE LARGE CURRENT ACCOUNT SURPLUS.}

^{SINGAPORE CONTINUES TO KEENLY WELCOME FOREIGN INVESTMENT AND OFFERS A VERY OPEN AND WELL-PLANNED ECONOMIC AND POLITICAL ENVIRONMENT. IT HAS BEEN IMPLEMENTING AMBITIOUS DIVERSIFICATION STRATEGY, FOCUSED PARTICULARLY ON THE CHEMICALS AND PHARMACEUTICAL SECTORS.}

^{THE GOVERNMENT USES FOREIGN DIRECT INVESTMENT TO DEVELOP PRIORITY SECTORS (ELECTRONICS, CHEMICALS, BIOTECHNOLOGY). THE AIM IS TO ENCOURAGE THE GROWTH OF HIGH ADDED-VALUE ACTIVITIES AND TURN SINGAPORE INTO A REGIONAL HUB FOR FOREIGN INVESTORS INTERESTED IN ASIA.}

^{CERTAIN SECTORS (MEDIA, LEGAL AND FINANCIAL SERVICES) ARE HOWEVER ONLY PARTIALLY OPEN TO FOREIGN INVESTMENT. THESE SECTORS ARE SLOWLY OPENING UP, BUT THE PROGRESS IS SLOW. AFTER HIGH GROWTH IN 2006, BUOYED BY THE DYNAMISM OF BOTH EXPORTS AND HOUSEHOLD CONSUMPTION, A SLOWDOWN IS EXPECTED IN 2007.}

^ASSETS

^{" MAJOR EXPORTER OF CAPITAL IN ASIA, NOTABLY VIA THE STATE-OWNED TEMASEK HOLDING}

^COMPANY.

^{" HIGH QUALITY COMPETITIVENESS IN ASIA}

^{" EXCELLENT BUSINESS CLIMATE}

^{" POLITICAL STABILITY.}

^WEAKNESSES

^{" SKILLED MANPOWER HAS BEEN LACKING IN THE SECTORS TARGETED FOR DEVELOPMENT.}

^{" AN AGEING POPULATION COULD, ULTIMATELY, AFFECT ECONOMIC PERFORMANCE.}

^{" GROWING INEQUALITY AND THE EMERGENCE OF LONG-TERM UNEMPLOYMENT AMONG THE LEAST}

^{SKILLED COULD GENERATE SOCIAL TENSIONS.}

^{" BEING THE WORLD'S MOST OPEN ECONOMY, IT HAS BEEN VULNERABLE TO WORLD ECONOMIC}

^DOWNTURNS.

WHOLESALE AND RETAIL TRADE SECTOR

PAST PERFORMANCE

DOMESTIC WHOLESALE TRADE INDEX

THE OVERALL DOMESTIC WHOLESALE TRADE DECLINED BY 7.5% IN Q1 2007. EXCLUDING PETROLEUM, DOMESTIC SALES FELL BY 7.4%. SECTORS OF ELECTRONIC COMPONENTS, SHIP CHANDLERS AND BUNKERING, INDUSTRIAL AND CONSTRUCTION MACHINERY REPORTED DECLINES OF 11.6% TO 23.8%.

HOWEVER, WHOLESALERS OF FOOD, BEVERAGES AND TOBACCO REGISTERED HIGHER TURNOVER OF 5.4%.

FOREIGN WHOLESALE TRADE INDEX

THE OVERALL FOREIGN WHOLESALE TRADE IN QUARTER 1 2007 FELL BY 7.6%. EXCLUDING PETROLEUM, FOREIGN SALES DECLINED BY 8.0%. MOST WHOLESALE SECTORS REPORTED LOWER OVERSEAS RECEIPTS IN QUARTER 1 2007 COMPARED TO THE PREVIOUS QUARTER, EXCEPT HOUSEHOLD EQUIPMENT AND FURNITURE SECTOR. SHIP CHANDLERS & BUNKERING REPORTED THE LARGEST DECLINE OF 18.3% IN QUARTER 1 2007, FOLLOWED BY FOOD BEVERAGES & TOBACCO SECTOR OF 17.7%.

RETAIL TRADE

THE OVERALL RETAIL SALES ROSE MARGINALLY BY 0.7% IN QUARTER 2 2007, COMPARED TO QUARTER 2 2006. EXCLUDING MOTOR VEHICLES, RETAIL SALES ROSE BY 5.1%. SALES OF OPTICAL GOODS & BOOKS, FURNITURE & HOUSEHOLD EQUIPMENT AND SUPERMARKETS ENJOYED STRONG GROWTHS OVER A YEAR AGO. PROVISION & SUNDRY SHOPS, WATCHES AND JEWELLERY, DEPARTMENT STORES AND WEARING APPAREL & FOOTWEAR SECTORS ALSO REPORTED HIGHER SALES OF 4.35 TO 5.9% RESPECTIVELY.

HOWEVER, RETAILERS OF MOTOR VEHICLES, FOOD & BEVERAGES, TELECOMMUNICATIONS APPARATUS & COMPUTERS AND PETROL SERVICES STATIONS REPORTED LOWER SALES.

OUTLOOK

GENERALLY, WHOLESALERS EXPECT TO DO WELL FOR THE NEXT 6 MONTHS, WITH A POSITIVE NET WEIGHTED BALANCE OF 17%. DEALERS OF FOOD & BEVERAGES, TROPICAL PRODUCE, TEXTILES & LEATHER GOODS AND HOUSEHOLD ELECTRICAL APPLIANCE & EQUIPMENT ARE AMONG THOSE WHO ARE OPTIMISTIC.

RETAIL TRADE FIRMS ANTICIPATE BUSINESS TO BE LESS BRISK FOR THE NEXT 6 MONTHS. IN PARTICULAR, DEPARTMENT STORES, SUPERMARKETS AND RETAILERS OF MOTOR VEHICLES EXPECT SLOWER BUSINESS IN THE COMING MONTHS.

EXTRACTED FROM: MINISTRY OF TRADE AND INDUSTRY, SINGAPORE

SINGAPORE DEPARTMENT OF STATISTICS

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.	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