MIRA INFORM REPORT

Report Date :

11.08.2008

IDENTIFICATION DETAILS

Name :	SRI TRANG INTERNATIONAL PTE. LTD.
Registered Office :	^1 Raffles Place ^#28-03 Oub Centre ^048616
Country :	Singapore
Financials (as on) :	31.12.2007
Date of Incorporation :	^09.04.2002
Com. Reg. No.:	^200202922R
Legal Form :	^Pte Ltd
Line of Business :	Commodity Brokers and Dealers

RATING & COMMENTS

MIRA’s Rating :

A

RATING		STATUS	PROPOSED CREDIT LINE
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

Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear

Subject Company

SRI TRANG INTERNATIONAL PTE. LTD.

Line Of Business 

COMMODITY BROKERS AND DEALERS

Parent Company

SRI TRANG AGRO-INDUSTRY PUBLIC

(PERCENTAGE OF SHAREHOLDINGS: 100.00%)

Financial Elements

FY 2007

COMPANY

Sales : US$ 546,042,563

Networth : US$ 18,418,959

Paid-Up Capital : US$ 8,000,000

Net result : US$ 4,886,598

Net Margin(%) : 0.89

Return on Equity(%) : 26.53

Leverage Ratio : 5.53

COMPANY IDENTIFICATION

^{Subject Company : SRI TRANG INTERNATIONAL PTE. LTD.}

^{Former Name : -}

^{Business Address : 1 RAFFLES PLACE}

^{#28-03 OUB CENTRE}

^{Town : SINGAPORE}

^{Postcode : 048616}

^{Country : Singapore}

^{Telephone : 6532 5210}

^{Fax : 6532 7501}

^{ROC Number : 200202922R}

^{Reg. Town : -}

SUMMARY

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

^{Legal Form : Pte Ltd}

^{Date Inc. : 09/04/2002}

^{Previous Legal Form : -}

^{Summary year : 31/12/2007}

^{Sales : 546,042,563}

^{Networth : 18,418,959}

^{Capital : -}

^{Paid-Up Capital : 8,000,000}

^{Employees : -}

^{Net result : 4,886,598}

^{Share value : 1}

^{Auditor : PRICEWATERHOUSECOOPERS}

^{BASED ON ACRA'S}

^{NO. OF SHARES CURRENCY AMOUNT}

^{ISSUED ORDINARY 8,000,000 USD 8,000,000}

^{PAID-UP ORDINARY - USD 8,000,000}

REFERENCES

^{Litigation : No}

^{Company status : TRADING}

^{Started : 09/04/2002}

PRINCIPAL(S)

^{SUN SZU-SHU @ SUSAN SUN 210421556 Director}

DIRECTOR(S)

^{KITICHAI SINCHAROENKUL Z011946 Director}

^{Appointed on : 09/04/2002}

^{Street : 72 SOI TANOMJIT SUDTHISARN RD}

^{DIN DAENG}

^{Town: BANGKOK}

^{Postcode: 10310}

^{Country: Thailand}

^{LEE PAUL SUMADE E1011462 Director}

^{Appointed on : 09/10/2003}

^{Street : 5 NEERIM ROAD}

^{CASTLE COVE}

^{Town: NSW 2069}

^Postcode:

^{Country: Australia}

^{TAN PENG CHIN S1269425C Company Secretary}

^{Appointed on : 09/04/2002}

^{Street : 3 JALAN HARUM}

^{OEI TIONG HAM PARK}

^{Town: SINGAPORE}

^{Postcode: 268477}

^{Country: Singapore}

^{VIYAVOOD SINCHAROENKUL G5681695Q Director}

^{Appointed on : 05/09/2002}

^{Street : 95 GRANGE ROAD}

^#06-10

^{GRANGE RESIDENCES}

^{Town: SINGAPORE}

^{Postcode: 249616}

^{Country: Singapore}

^{SUN SZU-SHU @ SUSAN SUN 210421556 Director}

^{Appointed on : 01/02/2007}

^{Street : 95 GRANGE ROAD}

^#06-10

^{GRANGE RESIDENCES}

^{Town: SINGAPORE}

^{Postcode: 249616}

^{Country: Singapore}

FORMER DIRECTOR(S)

^{ANDREW TREVATT S2723939J}

^{PROMSUK SINCHAROENKUL Z025763}

^{FRANS ANDREW DE JONG 140599406}

ACTIVITY(IES)

^{COMMODITY BROKERS Code:5000}

^{RUBBER BROKERS And DEALERS Code:18680}

^{BASED ON ACRA'S RECORD}

^{1) COMMODITY BROKERS AND DEALERS}

^{2) WHOLESALE OF RUBBER (INCLUDING RUBBER BROKERS)}

CHARGES

^{Date: 01/03/2005}

^{Comments : CHARGE NO: C200501287, C200501286}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE(S): DBS BANK LTD}

^{Date: 27/05/2004}

^{Comments : CHARGE NO: C200402537}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE(S): RAIFFEISEN ZENTRALBANK OESTERREICH AKTIENGESELLSCHAFT}

^{Date: 18/08/2003}

^{Comments : CHARGE NO: C200303977}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE(S): COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEENBANK B.A}

^{Date: 26/05/2006}

^{Comments : CHARGE NO: C200603327}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE(S): OVERSEA-CHINESE BANKING CORPORATION LTD}

^{Date: 23/10/2006}

^{Comments : CHARGE NO: C200607134}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE(S): COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEEBANK B.A.}

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

BANKERS

^{DBS BANK LTD.}

^{RAIFFEISEN ZENTRALBANK OESTERREICH AKTIENGESELLSCHAFT}

^{COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEENBANK BA}

^{OVERSEA-CHINESE BANKING CORPORATION LIMITED}

SHAREHOLDERS(S)

^{SRI TRANG AGRO-INDUSTRY PUBLIC 8,000,000 Company}

^{Street : 10 SOI 10 PHETKASEM RD}

^{HAT YAI SONGKHLA}

^{Town : -}

^{Postcode : 90110}

^{Country : Thailand}

HOLDING COMPANY

^{SRI TRANG AGRO-INDUSTRY PUBLIC UF25107H % : 100}

SUBSIDIARY(IES)

No Participation In Our Database

PAYMENT HISTORY AND EXPERIENCES

^{Trade Morality : AVERAGE}

^{Liquidity : SUFFICIENT}

^{Payments : REGULAR}

^{Trend : UPWARD}

^{Financial Situation : AVERAGE}

FINANCIAL ELEMENTS

^{Audit Qualification: UNQUALIFIED (CLEAN) UNQUALIFIED (CLEAN)}

^{Date Account Lodged: 02/04/2008}

^{Balance Sheet Date: 31/12/2007 31/12/2006}

^{Number of weeks: 52 52}

^{Consolidation Code: COMPANY COMPANY}

^{--- ASSETS ---}

^{Preliminary Exp 2,337,749 2,174,132}

^{Tangible Fixed Assets: 344,827 468,609}

^{Total Fixed Assets: 2,682,576 2,642,741}

^{Inventories: 17,691,730 7,854,119}

^{Receivables: 71,206,253 43,828,832}

^{Short Term Fin. Assets: 13,400,887 9,398,855}

^{Cash,Banks, Securitis: 14,576,369 4,740,117}

^{Other current assets: 756,341 823,123}

^{Total Current Assets: 117,631,580 66,645,046}

^{TOTAL ASSETS: 120,314,156 69,287,787}

^{--- LIABILITIES ---}

^{Equity capital: 8,000,000 8,000,000}

^{Profit & lost Account: 10,418,959 5,532,361}

^{Total Equity: 18,418,959 13,532,361}

^{L/T deffered taxes: 230,020}

^{Other long term Liab.: 154,963 242,301}

^{Total L/T Liabilities: 154,963 472,321}

^{Trade Creditors: 57,435,154 24,030,239}

^{Short term liabilities: 81,903 77,498}

^{Advanced payments: 149,549 90,872}

^{Due to Bank: 32,406,841 22,394,995}

^{Provisions: 362,181 78,414}

^{Other Short term Liab.: 10,843,875 8,257,973}

^{Prepay. & Def. charges: 460,731 353,114}

^{Total short term Liab.: 101,740,234 55,283,105}

^{TOTAL LIABILITIES: 101,895,197 55,755,426}

^{--- PROFIT & LOSS ACCOUNT ---}

^{Net Sales 546,042,563 331,009,737}

^{Purchases,Sces & Other Goods: 537,079,847 325,305,226}

^{Gross Profit: 8,962,716 5,704,511}

^{NET RESULT BEFORE TAX: 5,203,438 3,879,106}

^{Tax : 316,840 403,504}

^{Net income/loss year: 4,886,598 3,475,602}

^{Interest Paid: 1,988,866 1,388,166}

^{Depreciation: 130,278 120,787}

^{Wages and Salaries: 1,320,854 1,007,178}

^{Financial Income: 613,909 709,646}

RATIOS

^{31/12/2007 31/12/2006}

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

^{Stock / Turnover(%): 0.03 0.02}

^{Net Margin(%): 0.89 1.05}

^{Return on Equity(%): 26.53 25.68}

^{Return on Assets(%): 4.06 5.02}

^{Net Working capital: 15891346.00 11361941.00}

^{Cash Ratio: 0.14 0.09}

^{Quick Ratio: 0.84 0.88}

^{Current ratio: 1.16 1.21}

^{Receivables Turnover: 46.95 47.67}

^{Leverage Ratio: 5.53 4.12}

^{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}

^{Dividends Coverage : Net income loss year/Dividends}

^{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

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

^{NET WORTH:}

^{THE BALANCE SHEET WAS PASSABLE WITH NET WORTH IMPROVING BY 36.11% AMOUNTING TO USD18,418,959 (2006: USD13,532,361). THIS WAS CONTRIBUTED BY HIGHER RETAINED EARNINGS BROUGHT FORWARD OF USD10,418,959 (2006: USD5,532,361).}

^LEVERAGE:

^{IN THE SHORT-TERM, SUBJECT WAS LARGELY FINANCED BY TRADE CREDITORS WHICH MADE UP 56.45% (2006: 43.47%) OF THE TOTAL CURRENT LIABILITIES AND AMOUNTED TO USD57,435,154 (2006: US$24,030,239). THE BREAKDOWN WAS}

^{AS FOLLOWS:}

^{*HOLDING/ RELATED CORPORATION - 2007: USD47,476,107 (2006:}

^{USD18,784,859)}

^{*THIRD PARTIES - 2007: USD9,959,047 (2006: USD5,245,380)}

^{LEVERAGE RATIO ROSE TO 5.53 TIMES (2006: 4.12 TIMES) AS A RESULT OF A}

^{MORE THAN PROPORTIONATR RISE IN TOTAL LIABILITIES THAN IN TOTAL}

^{EQUITY. A LOWER RATIO WOULD BE MORE DESIRABLE AS THE LOWER THE RATIO,}

^{THE GREATER THE FINANCIAL SAFETY AND OPERATING FREEDOM FOR THE}

^COMPANY.

^LIQUIDITY:

^{THE OVERALL LIQUIDITY OF THE COMPANY WAS FAIRLY HEALTHY. NET WORKING CAPITAL REGISTERED HIGHER BY 39.86% TO USD15,891,346 (2006: USD11,361,941).}

^{BOTH CURRENT AND QUICK RATIOS DIPPED TO 1.16 TIMES (2006: 1.21 TIMES) AND 1.16 TIMES (2006: 1.21 TIMES) RESPECTIVELY.}

^{CASH AND CASH EQUIVALENTS ROSE SHARPLY BY 2.08 TIMES TO USD 14,576,369}

^{(2006: USD4,740,117) AND COMPRISED OF:}

^{*CASH AT BANK AND ON HAND - 2007: USD4,990,768 (2006: USD4,067,889)}

^{*SHORT-TERM BANK DEPOSITS - 2007: USD9,585,601 (2006: USD672,228)}

^{PROFITABILITY:}

^{REVENUE FOR FY2007 REGISTERED HIGHER BY 64.96%, TOTALLING USD546,042,563 (2006: USD331,009,737). NET INCOME ALSO ROSE BY 40.60%, ACCOUNTING FOR USD4,886,598 (2006: USD3,475,602). HOWEVER, NET MARGIN DROPPED TO 0.89% (2006: 1.05%).}

^{DEBT SERVICING:}

^{DEBT SERVICING PROBLEMS MIGHT NOT BE EXPECTED IF REVENUE AND EARNINGS CAN BE MAINTAINED AND PAYMENTS BY TRADE DEBTORS ARE FORTHCOMING.}

^{THE AVERAGE COLLECTION PERIOD WAS RELATIVELY THE SAME FOR BOTH YEARS AT 47 DAYS (2006: 48 DAYS).}

^{NON-CURRENT ASSETS}

^{THE FOLLOWING ITEMS WERE CLASSIFIED UNDER PRELIMINARY:}

^{*CLUB MEMBERSHIPS - 2007: USD337,228 (2006: USD174,132)}

^{*DEFERRED TAXATION ASSET - 2007: USD521 (2006: NIL)}

^{*SUBORDINATED DEBTS - 2007: USD2,000,000 (2006: USD2,000,000)}

^{NOTES TO THE FINANCIAL STATEMENTS:}

^{CONTINGENT LIABILITIES}

^{THE COMPANY IS OBLIGED TO MEET ANY LIABILITIES IN ACCORDANCE WITH}

^{RULE 702 OF THE EXCHANGE'S RULES AND REGULATIONS SHOULD ANY CLEARING}

^{MEMBER BECOME INSOLVENT AND UNABLE TO PAY FOR ITS LOSSES TO THE}

^{EXCHANGE UPON EXHAUSTING ALL THE FUNDS AVAILABLE UNDER THE SAME RULE.}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 09/04/2002 AS A LIMITED PRIVATE COMPANY AND IS TRADING UNDER ITS PRESENT NAMESTYLE AS "SRI TRANG INTERNATIONAL PTE. LTD.".}

^{THE COMPANY HAS AN ISSUED AND PAID-UP CAPITAL OF 8,000,000 SHARES OF A VALUE OF US$8,000,000.}

^{PRINCIPAL ACTIVITIES:}

^{SUBJECT IS REGISTERED WITH THE ACCOUNTING & CORPORATE REGULATORY}

^{AUTHORITY (ACRA) TO BE PRINCIPALLY ENGAGED IN THE BUSINESS OF:}

^{1) COMMODITY BROKERS AND DEALERS}

^{2) WHOLESALE OF RUBBER (INCLUDING RUBBER BROKERS)}

^{THE COMPANY IS LISTED IN THE SINGAPORE LOCAL DIRECTORY UNDER THE CLASSIFICATION OF: RUBBER BROKERS & DEALERS.}

^{DURING THE FINANCIAL YEAR(S), UNDER REVIEW, THE PRINCIPAL ACTIVITY OF THE COMPANY IS THE TRADING OF RUBBER INCLUDING RUBBER FUTURES AND OTHER DERIVATIVE CONTRACTS.}

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

^{SUBJECT ENGAGES IN THE FOLLOWING ACTIVITY:}

^{* TRADING AND SUPPLIER OF NATURAL RUBBER TO THE CONSUMING INDUSTRIES}

^{PRODUCTS (HOLDING COMPANY):}

^{* TSR/CV BLOCK RUBBER}

^{* RIBBED SMOKED SHEETS (RSS)}

^{* CONCENTRATED LATEX}

^{* MEDICAL EXAMINATION GLOVES}

^{* RUBBER AND PLASTIC PARTS}

^{* HIGH-PRESSURE HYDRAULIC HOSES}

^{* ESCALATOR HANDRAILS}

^{FROM THE TELE-INTERVIEW CONDUCTED, THE FOLLOWING WAS GATHERED:}

^{SUBJECT ENGAGES IN THE FOLLOWING ACTIVITY:}

^{* TRADING OF RAW RUBBER}

^{SUBJECT SUPPLIES TO BOTH LOCAL SINGAPORE AND INTERNATIONAL MARKET.}

^{IMPORT COUNTRIES:}

^{* WORLDWIDE (E.G. INDONESIA AND MALAYSIA)}

^{EXPORT COUNTRIES:}

^{* WORLDWIDE (E.G. JAPAN, THE UNITED STATES AND EUROPE)}

^{NO OTHER TRADE INFORMATION WAS AVAILABLE}

^{THE COMPANY'S IMMEDIATE AND ULTIMATE HOLDING CORPORATION IS SRI TRANG}

^{AGRO-INDUSTRY PUBLIC COMPANY LIMITED, INCORPORATED IN THAILAND.}

^{REGISTERED ADDRESS:}

^{30 RAFFLES PLACE}

^#11-00

^{CALTEX HOUSE}

^{SINGAPORE 048622}

^{DATE OF CHANGE OF ADDRESS: 23/05/2005}

^{BUSINESS ADDRESS:}

^{1 RAFFLES PLACE}

^{#28-03 OUB CENTRE}

^{SINGAPORE 048616}

^{- OFFICE}

^{- RENTED PREMISE}

^{- PREMISE OWNED BY: OUB CENTRE LTD}

^WEBSITE:

^{http://www.sritranggroup.com (HOLDING COMPANY'S WEBSITE)}

^{http://www.sritranggroup.com/sti/index.php?lang=EN}

^{E-MAIL :}

^{sti@sritranggroup.com}

MANAGEMENT

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

^{1) SUN SZU-SHU @ SUSAN SUN, A TAIWANESE}

^{- BASED IN SINGAPORE}

^{2) LEE PAUL SUMADE, AN AUSTRALIAN}

^{- BASED IN AUSTRALIA}

^{3) VIYAVOOD SINCHAROENKUL, A THAI}

^{- BASED IN SINGAPORE}

^{4) KITICHAI SINCHAROENKUL, A THAI}

^{- BASED IN THAILAND}

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.

OVERVIEW OF SINGAPORE

PAST PERFORMANCE

SINGAPORE’S ECONOMY GREW BY 5.4% IN 4Q 2007, SLOWER THAN THE 9.5% GROWTH IN 3Q 2007. GROW MOMENTUM WAS LED BY CONSTRUCTION AND FINANCIAL SERVICES. FOR THE WHOLE OF 2007, THE ECONOMY GREW BY 7.7%, DOWN FROM 8.2% IN 2006.

THE MANUFACTURING SECTOR ROSE BY 0.2% IN 4Q 2007, SLOWER THAN THE 11.0% IN 3Q 2007. THE SMALL GROWTH WAS ATTRIBUTED TO A 28.0% CONTRACTION IN THE BIOMEDICAL MANUFACTURING SECTOR. ON THE OTHER HAND, ELECTRONICS, CHEMICALS, PRECISION ENGINEERING AND TRANSPORT ENGINEERING SECTOR PERFORMED BETTER. OVERALL, THE MANUFACTURING SECTOR POSTED A 5.8% GROWTH IN 2007, DOWN FROM 12.0% IN 2006.

THE FINANCIAL SERVICES SECTOR ROSE SIGNIFICANTLY BY 16% IN 4Q 2007, FOLLOWING A 20% GROWTH IN THE PREVIOUS QUARTER. MOST SECTORS EXPERIENCE STRONG EXPANSION WITH THE EXCEPTION OF STOCK BROKING AND FUND MANAGEMENT ACTIVITIES WHICH HAVE SLOWED DOWN. OVERALL, THE FINANCIAL SERVICES SECTOR POSTED A 17% GROWTH IN 2007, HIGHER THAN 11.0% IN 2006.

THE CONSTRUCTION SECTOR REGISTERED A STRONG GROWTH. THE SECTOR GREW BY 24%, FOLLOWING 20% GAIN IN 3Q 2007. GROWTH MOMENTUM FOR THE WHOLE YEAR GREW 20%, ITS FASTEST GROWTH SINCE 1996.

THE WHOLESALE AND RETAIL TRADE SECTOR GREW BY 6.0% IN 4Q 2007, SLOWER THAN THE 6.8% GROWTH IN 3Q 2007. NON-OIL RE-EXPORTS SAW GROWTH REDUCED FROM 9.0% IN 3Q 2007 TO 7.0% IN 4Q 2007. RETAIL SALES FELL BY 2.5% IN 4Q 2007, FOLLOWING A 1.5% GROWTH IN 3Q 2007. OVERALL, THE WHOLESALE AND RETAIL TRADE SECTOR POSTED A 7.3% GROWTH IN 2007, DOWN FROM 10.0% IN 2006.

THE TRANSPORT AND STORAGE SECTOR ROSE BY 5.4% IN 4Q 2007, FROM 5.0% IN 3Q 2007. HIGHER GROWTH IN THE SEA TRANSPORT SEGMENT WAS OFFSET BY SLOWER GROWTH IN THE AIR TRANSPORT SEGEMENT. OVERALL, THE TRANSPORT AND STORAGE SECTOR POSTED A 5.1% GROWTH IN 2007, UP FROM 4.7% IN 2006.

THE HOTELS AND RESTAURANTS SECTOR GREW BY A SMALLER 2.5% FROM 4.9% IN 3Q 2007. VISITOR ARRIVALS ROSE 5.5% IN 4Q 2007, SIMILAR TO 5.4% RISE IN 3Q 2007. HOWEVER, THE AVERAGE OCCUPANCY RATE OF HOTELS DIPPED TO 86.0% IN 4Q 2007 FROM 88.0% IN 4Q 2006. VISITOR ARRIVALS ROSE 5.4% TO REACH A RECORD OF 10.3 MILLION IN 2007. OVERALL, THE HOTELS AND RESTAURANTS SECTOR POSTED A 4.4% GROWTH IN 2007, DOWN FROM 4.8% IN 2006.

THE INFORMATION AND COMMUNICATIONS SECTOR ROSE 6.1% IN 4Q 2007, SLIGHTLY SLOWER THAN THE 6.6% IN 3Q 2007. BOTH THE TELECOMMUNICATIONS AND IT SERVICES SEGMENTS REMAINED HEALTHY DURING THE QUARTER. FOR THE TELECOMMUNICATIONS SEGMENT, THE GROWTH OF INTERNATIONAL TELEPHONE CALLS DURATION AND NUMBER OF SUBSCRIBERS FOR BOTH MOBILE PHONE SERVICE AND BROADBAND INTERNET REMAINED STRONG. OVERALL, THE INFORMATION AND COMMUNICATIONS SECTOR POSTED A 6.3% GROWTH IN 2007, UP FROM 4.6% IN 2006.

THE BUSINESS SERVICES SECTOR EXPANDED BY 8.7%, HIGHER THAN THE 7.5% GAIN IN 3Q 2007. GROWTH WAS HEALTHY ACROSS ALL SEGMENTS, WITH GOOD PERFORMANCES IN THE BUSINESS REPRESENTATIVE OFFICES AND REAL ESTATE SEGMENTS. OVERALL, THE BUSINESS SERVICES SECTOR POSTED A 7.8% GROWTH IN 2007, UP FROM 6.9% IN 2006.

NEWS

SINGAPORE ECONOMY GROWS 7.2% ON STRONG SHOWING IN MANUFACTURING

SINGAPORE’S ECONOMY TURNED OUT TO BE SURPRISINGLY RESLIENT IN THE FIRST QUARTER, EASILY BEATING MARKET EXPECTATIONS WITH STRONG GROWTH OF 7.2%.

THE ADVANCE ESTIMATES ISSUED BY THE MINISTRY OF TRADE AND INDUSTRY (MTI) REPORTED YESTERDAY WERE A MARKED IMPROVEMENT OVER THE 5.4% POSTED IN THE FINAL QUARTER OF LAST YEAR. EARLIER REPORTS HAD SUGGESTED MARKET EXPECTATIONS OF 5.9% GROWTH. ON A SEASONALLY ADJUSTED ANNUALISED BASIS, THE ECONOMY GREW AT A BREAKNECK RATE OF 16.9% QUARTER-ON-QUARTER. IT SHRANK 4.8% IN 4Q 2007.

HOWEVER, ECONOMISTS DO NOT BELIEVE THE STRONG PERFORMANCE SIGNIFIES AN UPTREND FOR THE REST OF THE YEAR. THEY POINT TO A POTENTIAL RECESSION IN THE UNITED STATES AND RISING GLOBAL INFLATION.

MANUFACTURING AND SERVICES WERE CONTRIBUTORS TO THE BETTER-THAN-EXPECTED FIRST QUARTER GROWTH.

MANUFACTURING IS ESTIMATED TO HAVE EXPANDED BY 13.2% IN THE FIRST QUARTER, COMPARED TO A SMAL 0.2% RISE IN THE PREVIOUS THREE MONTHS. IT WAS ALSO CONSIDERABLY HIGHER THAN THE 3.9% REGISTERED IN 1Q 2007.

THIS WAS LARGELY DUE TO A SURGE IN BIOMEDICAL MANUFACTURING OUTPUT. THE REST OF THE MANUFACTURING CLUSTERS ALSO ENJOYED BETTER PERFORMANCES

WITH THE EXCEPTION OF TRANSPORT ENGINEERING AND PRECISION ENGINEERING CLUSTER WHO ENJOY MODERATE GROWTH.

SERVICES INDUSTRIES GROW 7.6%, SIMILAR TO THE 7.7% IN 4Q 2007 AS WELL AS IN 1Q 2007. FINANCIAL SERVICES CONTINUED TO BE THE FASTEST-GROWING AMONG THE SERVICES SECTORS.

HOWEVER, THE FIGURE FOR THE SLOWING CONSTRUCTION SECTOR WAS LESS ROSY WITH GROWTH SLIPPING TO 14.6% FROM 24.3% IN 4Q 2007.

UNITED OVERSEAS BANK ECONOMIST HO WOEI CHEN SAID THIS WAS DISAPPOINTING,

AFTER THREE QUARTERS OF GROWTH ABOVE 20.0%. BUT SHE STILL EXPECTED THE SECTOR TO CONTRIBUTE TO GROWTH THIS YEAR, ON THE BACK OF INFRASTRCTURE PROJECTS SUCH AS THE INTEGRATED RESORTS AND THE PROPOSED SPORTS HUB IN KALLANG.

ECONOMISTS WERE SURPRISED BY WHAT THEY SAID AMOUNTED TO A CONTRACTION IN THE INDUSTRY BUT THEY REMAINED CONFIDENT THAT GROWTH WAS STILL HEALTHY AND IN LINE WITH THEIR FORECASTS FOR THE YEAR, WHICH RANGED FROM 10.0%

TO 25.0%.

CIMG-GK ECONOMIST SOGN SENG WUN SAID THAT RISING INFLATION, ESPECIALLY FOR FOOD PRICES, WILL BE A MAJOR CONCERN. “PEOPLE ARE FOCUSING ON ISSUES SUCH AS THE RISING PRICE OF RICE AND THIS IS SOMETHING THAT COULD PERSIST FOR THE REST OF THE YEAR”.

NONE OF THE ECONOMISTS INTERVIEWED REVISE FULL-YEAR GROWTH FORECASTS WHICH RANGE FROM 4.7% TO 5.5%. MTI HAS FORECAST A RANGE OF 4.0% TO 6.0% FOR THE YEAR.

OUTLOOK

AFTER THE LAST REVIEW IN NOVEMBER 2007, THE OUTLOOK FOR EXTERNAL DEMAND IN 2008 HAS WORSENED AND THERE ARE INCREASED DOWNSIDE RISKS.

COMPARED TO THE FORECAST THREE MONTHS AGO, THERE IS BROAD CONSENSUS NOW THAT THE US ECONOMY IS ENTERING A SLOWDOWN. THE LENGTH AND SEVERITY OF THE SLOWDOWN REMAINS TO BE SEEN, AND IT WILL AFFECT COUNTRIES WORLDWIDE AND KEY INDUSTRIES.

TAKING INTO ACCOUNT THE RISE IN DOWNSIDE RISKS, THE MINISTRY OF TRADE AND INDUSTRY LOWERED THE ECONOMIC FORECAST FOR THE SINGAPORE ECONOMY TO GROW BY 4.0-6.0% IN 2008, DOWN FROM THE GROWTH FORECAST OF 4.5-6.5% EARLIER.

CURRENT CONDITIONS INDICATE THAT THE US ECONOMY WILL LIKELY ENTER A MILD RECESSION IN THE FIRST HALF BUT ITS STRONG FUNDAMENTALS, COUPLED WITH FISCAL AND MONETARY STIMULUS, WILL ASSIST TO SUPPORT RECOVERY IN THE SECOND HALF. REGIONAL ECONOMIES WILL HAVE MODERATE BUT HEALTHY GROWTH. SINGAPORE’S GDP GROWTH WILL THEN BE IN THE UPPER HALF OF THE FORECAST RANGE. HOWEVER, IF THE US FALLS INTO A MORE SEVERE RECESSION, THE REGION WILL BE MORE SIGNIFICANTLY AFFECTED. THE IMPACT ON THE SINGAPORE ECONOMY WILL ALSO BE STRONGER, PARTICULARLY IN THE SENTIMENT-SENSITIVE AND EXPORT-ORIENTED SECTORS LIKE FINANCIAL SERVICES, WHOLESALE TRADE AND ELECTRONICS. IN THIS ENVIRONMENT, THE SINGAPORE ECONOMY WILL GROW AT A SLOWER PACE, NEARER THE LOWER END OF THE FORECAST RANGE.

IN THE FINANCIAL SERVICES INDUSTRY, A NET WEIGHTED BALANCE OF 19% OF FIRMS, ESPECIALLY INSURANCE COMPANIES AND FIRMS PROVIDING CREDIT CARD SERVICES, REMAINS POSITIVE ABOUT THE BUSINESS OUTLOOK IN THE MONTHS AHEAD.

IN THE REAL ESTATE INDUSTRY, A NET WEIGHTED BALANCE OF 17% OF FIRMS,

EXPECT BUSINESS TO BE BRISK FOR THE COMING MONTHS.

MANUFACTURING FIRMS ARE CAUTIOUS ABOUT BUSINESS CONDITIONS FOR THE PERIOD ENDING JUNE 2008. A NET WEIGHTED BALANCE OF 2% OF MANUFACTURERS FORECAST BETTER BUSINESS, LOWER THAN THE 7% REGISTERED IN THE SAME PERIOD LAST YEAR AND THE 25% RECORDED IN THE PREVIOUS QUARTER.

GENERALLY, WHOLESALERS ARE POSITIVE ABOUT THEIR BUSINESS PROSPECTS IN THE COMING MONTHS, WITH A NET WEIGHTED BALANCE OF 4% OF FIRMS EXPRESSING POSITIVE BUSINESS SENTIMENTS. THE MAJORITY OF WHOLESALERS OF PETROLEUM AND PETROLEUM PRODUCTS, CHEMICALS AND CHEMICAL PRODUCTS, INDUSTRIAL MACHINERY AND EQUIPMENT AND COMPUTERS AND ACCESSORIES FORECAST BUSINESS OUTLOOK TO REMAIN THE SAME IN THE FIRST SIX MONTHS OF 2008 COMPARED WITH THE LAST SIX MONTHS IN 2007.

A NET WEIGHTED BALANCE OF 12% OF RETAILERS PREDICTS LESS FAVOURABLE BUSINESS CONDITIONS FOR THE PERIOD ENDING JUNE 2008. AS A RESULT OF THE REDUCED CERTIFICATE OF ENTITLEMENT (COE) QUOTA, MOTOR VEHICLES RETAILERS ARE ESPECIALLY CONCERNED WITH THE SALES.

IN THE TRANSPORT AND STORAGE INDUSTRY, A NET WEIGHTED BALANCE OF 5% OF FIRMS FORECASTS LESS FAVOURABLE BUSINESS CONDITIONS FOR THE COMING MONTHS.

IN THE SERVICES INDUSTRY, A NET WEIGHTED BALANCE OF 8% OF FIRMS,

EXPECT BUSINESS TO BE BRISK FOR THE COMING MONTHS. THIS IS SMALLER THAN THE 18% REGISTERED IN THE SAME PERIOD LAST YEAR AND THE 23% RECORDED IN THE PREVIOUS QUARTER. HOTELIERS REMAIN BULLISH ON BUSINESS CONDITIONS FOR THE COMING MONTHS, WITH A NET WEIGHTED BALANCE OF 35% OF HOTELIERS EXPECTING THEIR BUSINESSES TO RISE IN ANTICIPATION OF EXPECTED INCREASES IN ROOM RATES AND HIGHER OCCUPANCY RATES. IN THE CATERING TRADE INDUSTRY, A NET WEIGHTED BALANCE OF 27% OF CATERERS ANTICIPATES MORE FAVOURABLE BUSINESS CONDITIONS.

IN THE INFORMATION AND COMMUNICATIONS INDUSTRY, A NET WEIGHTED BALANCE OF 9% OF FIRMS PREDICTS A HIGHER DEMAND FOR THEIR SERVICES, IN PARTICULAR THE NETWORK OPERATORS.

IN THE BUSINESS SERVICES INDUSTRY, AN OVERALL NET WEIGHTED BALANCE OF 19% OF FIRMS EXPECTS POSITIVE SENTIMENTS. THESE INCLUDE ACCOUNTING, BOOK-KEEPING AND AUDITING, RENTING OF CONSTRUCTION AND INDUSTRIAL MACHINERY AND RENTING OF TRANSPORT EQUIPMENT.

EXTRACTED FROM: MINISTRY OF TRADE AND INDUSTRY, SINGAPORE

SINGAPORE DEPARTMENT OF STATISTICS

THE STRAITS TIMES

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.42.20
UK Pound	1	Rs.81.48
Euro	1	Rs.64.27

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%)

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