MIRA INFORM REPORT

Report Date :

08.01.2008

IDENTIFICATION DETAILS

Name :	HANWA SINGAPORE PRIVATE LIMITED
Registered Office :	^20 Cecil Street, ^#20-06/07, ^Equity Plaza, Singapore 049705
Country :	Singapore
Financials (as on) :	28.02.2007
Date of Incorporation :	19.04.1972
Com. Reg. No.:	197200466Z
Legal Form :	Pte Ltd
Line of Business :	Importers and Exporters, Wholesalers of General Merchandise and Commission Agents

RATING & COMMENTS

MIRA’s Rating :

Ba

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

Status :	Satisfactory
Payment Behaviour :	Regular
Litigation :	Clear

Subject Company

HANWA SINGAPORE (PRIVATE) LIMITED

Line Of Business 

IMPORTERS AND EXPORTERS, WHOLESALERS OF GENERAL MERCHANDISE AND COMMISSION AGENTS

Parent Company

HANWA CO., LTD

(PERCENTAGE OF SHAREHOLDINGS: 100%)

Financial Elements

Sales : US$ 52,877,177

Networth : US$ 1,495,724

Paid-Up Capital : US$ 827,981

Net result : US$ 474,808

Net Margin(%) : 0.90

Return on Equity(%) : 31.74

Leverage Ratio : 3.31

COMPANY IDENTIFICATION

^{Subject Company : HANWA SINGAPORE (PRIVATE) LIMITED}

^{Former Name : -}

^{Business Address: 20 CECIL STREET}

^#20-06/07

^{EQUITY PLAZA}

^{Town: SINGAPORE}

^{Postcode: 049705}

^{Country: Singapore}

^{Telephone: 6536 7822}

^{Fax: 6536 7855}

^{ROC Number: 197200466Z}

^{Reg. Town: -}

SUMMARY

^{All amounts in this report are in : USD}

^{Legal Form : Pte Ltd}

^{Date Inc. : 19/04/1972}

^{Previous Legal Form : -}

^{Summary year : 28/02/2007}

^{Sales : 52,877,177}

^{Networth : 1,495,724}

^{Capital : -}

^{Paid-Up Capital : 827,981}

^{Employees : 12}

^{Net result : 474,808}

^{Share value : 1}

^{Auditor : K B LEE & CO}

^{BASED ON ACRA'S}

^{NO. OF SHARES CURRENCY AMOUNT}

^{ISSUED ORDINARY 1,400,000 SGD 1,400,000}

^{PAID-UP ORDINARY - SGD 1,400,000}

REFERENCES

^{Litigation `: No}

^{Company status : TRADING}

^{Started : 19/04/1972}

PRINCIPAL(S)

^{KENZO SADA G5681514M Director}

DIRECTOR(S)

^{CHAN LAY CHIN S2003384C Company Secretary}

^{Appointed on : 28/03/1989}

^{Street : 4 HAIG LANE}

^{Town : SINGAPORE}

^{Postcode : 438808}

^{Country : Singapore}

^{KENZO SADA G5681514M Director}

^{Appointed on : 16/03/2005}

^{Street : 2 KIM SENG WALK}

^#14-03

^{Town : SINGAPORE}

^{Postcode : 239404}

^{Country : Singapore}

^{HIROSHI EBIHARA MZ0211247 Director}

^{Appointed on : 28/04/2005}

^{Street : 5-5-2-605 TENNODAI, ABIKO-SHI}

^{CHIBA-PREFECTURE, 270 1143}

^Town:

^Postcode:

^{Country: Japan}

^{TADAHIKO KAIDA TE5213714 Director}

^{Appointed on : 03/04/2006}

^{Street : SHIROYAMA-DAI 3-38-7}

^{HASHIMOTO CITY, WAKAYAMA}

^648-0054

^{Town :}

^{Postcode :}

^{Country : Japan}

^{HAJIME SHINKUMA TZ0167422 Director}

^{Appointed on : 03/04/2006}

^{Street : HATTORI-DAI 4-7-35}

^{KAN-MAKI-CHO, KITA KATSURAGI-GUN}

^{Town : NARA}

^{Postcode : 639-0212}

^{Country : Japan}

FORMER DIRECTOR(S)

^{PEK HOCK BENG S0893017A}

^{TOMIYAMA MUTSUO SH0358608}

^{BANDO SHOZABURO MM3265937}

^{SHIMIZU KAZUHIKO SM3531966}

^{HATOKO KENZO FME014045}

^{ITO HYOICHIRO MH331687}

^{TAKASHI TETSURO SML719155}

^{KITA SHUJI MN2100551}

^{KITA SHIGERU RBC86706}

^{KITA JIRO RCB86705}

^{IWAMI TAKASHI RCB86707}

^{SEMURA AKIHIRO MM0424328}

^{SHINSUKE KITAMURA MP5156930}

^{TERUO ASAI MZ0066219}

ACTIVITY (IES)

^{IMPORTERS And EXPORTERS Code:11760}

^{COMMISSION MERCHANTS Code:4990}

^{GENERAL MERCHANDISE - WHSLE Code:10220}

^{BASED ON ACRA'S RECORD}

^{1) GENERAL WHOLESALE TRADE (INCLUDING GENERAL IMPORTERS & EXPORTERS); IMPORTERS AND EXPORTERS, WHOLESALERS OF GENERAL MERCHANDISE}

CHARGES

No Charges On Premises/Property In Our Database

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

SHAREHOLDERS(S)

^{HANWA CO., LTD 1,400,000 Company}

^{Street : 4-3-9, FUSHIMI-MACHI}

^CHUO-KU

^{Town : OSAKA}

^{Postcode :}

^{Country : Japan}

FORMER SHAREHOLDER(S)

^{HANWA CO HONGKONG LTD 2,153,000}

^{PEK HOCK BENG 153,000}

^{BANDO SHOZABURO 73,500}

^{HATOKO KENZO 73,500}

HOLDING COMPANY

^{HANWA CO., LTD UF01065G % : 100}

SUBSIDIARY (IES)

No Participation In Our Database

PAYMENT HISTORY AND EXPERIENCES

^{Trade Morality : AVERAGE}

^{Liquidity : SUFFICIENT}

^{Payments : REGULAR}

^{Trend : UPWARD}

^{Financial Situation : AVERAGE}

LITIGATION(S)

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

^{Case Number : HWS01124/87}

Defendant HANWA SINGAPORE (PRIVATE) LIMITED ROC # : 197200466Z

FINANCIAL ELEMENTS

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

^{Date Account Lodged: 20/08/2007}

^{Balance Sheet Date: 28/02/2007 28/02/2006}

^{Number of weeks: 52 52}

^{Consolidation Code: COMPANY COMPANY}

^{--- ASSETS ---}

^{Tangible Fixed Assets: 17,184 15,477}

^{Investments 2,000 2,000}

^{Total Fixed Assets: 19,184 17,477}

^{Inventories: 215,914 191,991}

^{Receivables: 5,068,205 3,613,497}

^{Cash,Banks, Securitis: 973,612 763,708}

^{Other current assets: 166,212 351,695}

^{Total Current Assets: 6,423,943 4,920,891}

^{TOTAL ASSETS: 6,443,127 4,938,368}

^{--- LIABILITIES ---}

^{Equity capital: 827,981 827,981}

^{Profit & lost Account: 667,743 192,935}

^{Total Equity: 1,495,724 1,020,916}

^{Trade Creditors: 1,531,976 604,635}

^{Due to Bank: 3,163,335 1,015,572}

^{Provisions: 1,600}

^{Other Short term Liab.: 16,787 2,008,175}

^{Prepay. & Def. charges: 233,705 289,070}

^{Total short term Liab.: 4,947,403 3,917,452}

^{TOTAL LIABILITIES: 4,947,403 3,917,452}

^{PROFIT & LOSS ACCOUNT}

^{Net Sales 52,877,177 28,405,388}

^{NET RESULT BEFORE TAX: 477,556 221,995}

^{Tax : 2,748}

^{Net income/loss year: 474,808 221,995}

^{Interest Paid: 279,964 122,824}

^{Depreciation: 15,333 9,400}

^{Directors Emoluments: 89,226 119,684}

^{Wages and Salaries: 452,783 476,489}

^{Financial Income: 68,541 25,928}

RATIOS

^{28/02/2007 28/02/2006}

^{Turnover per employee: 4406431.42 2367115.67}

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

^{Fin. Charges / Turnover(%): 0.01 0.00}

^{Stock / Turnover(%): 0.00 0.01}

^{Net Margin(%): 0.90 0.78}

^{Return on Equity(%): 31.74 21.74}

^{Return on Assets(%): 7.37 4.50}

^{Net Working capital 1476540.00 1003439.00}

^{Cash Ratio: 0.20 0.19}

^{Quick Ratio: 1.22 1.12}

^{Current ratio: 1.30 1.26}

^{Receivables Turnover: 34.51 45.80}

^{Leverage Ratio: 3.31 3.84}

^{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

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

^{NET WORTH:}

THE BALANCE SHEET WAS CONSIDERED PASSABLE WITH NET WORTH IMPROVED BY 46.51% FROM US$1,020,916 IN FY 2006 TO US$1,495,724 IN FY 2007. THIS WAS DUE TO HIGHER ACCUMULATED PROFIT OF US$667,743 (2006: US$192,935); A RISE OF 2.46 TIMES FROM THE PRIOR FINANCIAL YEAR.

^LEVERAGE:

^{IN THE SHORT-TERM, SUBJECT WAS LARGELY FINANCED BY AMOUNT DUE TO BANKS WHICH MADE UP 63.94% (2006: 25.92%) OF THE TOTAL CURRENT LIABILITIES AND AMOUNTED TO US$3,163,335 (2006: US$1,015,572). THE BREAKDOWN IS AS FOLLOWS: -SHORT-TERM LOAN - 2007: US$3,163,335 (2006: US$1,015,572)}

^{IN ALL, LEVERAGE RATIO FELL FROM 45.80 TIMES TO 34.51 TIMES AS A RESULT OF A GREATER RELATIVE RISE IN TOTAL EQUITY THAN TOTAL LIABILITIES.}

^LIQUIDITY:

^{IN GENERAL, SUBJECT'S LIQUIDITY SITUATION WAS PASSABLE AS SEEN FROM THE RISE IN NET WORKING CAPITAL AND LIQUIDITY RATIOS. CURRENT RATIO ROSE TO 1.30 TIMES, UP FROM 1.26 TIMES AND QUICK RATIO IMPROVED TO 1.22 TIMES FROM 1.12 TIMES IN FY 2006.}

^{SIMILARLY, NET WORKING CAPITAL IMPROVED BY 47.15% FROM US$1,003,439 IN FY 2006 TO US$1,476,540.}

^{CASH AND CASH EQUIVALENTS COMPRISE OF:}

^{-FIXED DEPOSIT WITH A BANK - 2007: US$958,007 (2006: US$735,586)}

^{-BANK BALANCE - 2007: US$15,605 (2006: US$28,122)}

^{PROFITABILITY:}

^{REVENUE POSTED A RISE OF 86.15% FROM US$28,405,388 IN FY 2006 TO}

^{US$52,877,177 AND NET PROFIT ROSE BY 1.14 TIMES TO US$474,808 (2006:}

^{US$221,995). HENCE, NET MARGIN ROSE TO 0.90% (2006: 0.78%).}

^{DEBT SERVICING:}

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

^{NOTES TO THE FINANCIAL STATEMENTS:}

^{BANK FACILITIES}

^{BANK FACILITIES TO THE EXTENT OF APPROXIMATELY US$4.3 MILLION (2006: US$3.1 MILLION) WERE EXTENDED TO THE COMPANY AGAINST GUARANTEE PROVIDED BY THE HOLDING COMPANY.}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 19/04/1972 AS A LIMITED PRIVATE COMPANY AND IS TRADING UNDER ITS PRESENT NAMESTYLE AS "HANWA SINGAPORE (PRIVATE) LIMITED".}

^{AS AT 31/12/2007, THE COMPANY HAS AN ISSUED AND PAID-UP CAPITAL OF 1,400,000 SHARES OF A VALUE OF S$1,400,000.}

^{PRINCIPAL ACTIVITIES:}

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

^{1) GENERAL WHOLESALE TRADE (INCLUDING GENERAL IMPORTERS & EXPORTERS); IMPORTERS AND EXPORTERS, WHOLESALERS OF GENERAL MERCHANDISE}

^{2) WHOLESALE ON A FEE OR CONTRACT BASIS (EG COMMISSION AGENCIES)}

^{THE COMPANY IS LISTED IN THE SINGAPORE LOCAL DIRECTORIES UNDER THE CLASSIFICATION OF: IMPORTERS AND EXPORTERS.}

^{DURING THE FINANCIAL YEAR UNDER REVIEW, THE PRINCIPAL ACTIVITIES OF THE COMPANY CONSIST OF IMPORTERS AND EXPORTERS, WHOLESALERS OF GENERAL MERCHANDISE AND}

^{COMMISSION AGENTS.}

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

^{SUBJECT ENGAGES IN THE FOLLOWING ACTIVITIES:}

^{* IMPORTER AND EXPORTER OF IRON AND STEEL, MACHINES, NON-FERROUS METALS, BUNKER OIL, AGRICULTURAL AND MARINE PRODUCTS PETROLEUM PRODUCTS, CHEMICAL/POLYMERS, PLASTIC PRODUCTS}

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

^{* JAPANESE CHAMBER OF COMMERCE AND INDUSTRY}

^{* SINGAPORE CHINESE CHAMBERS OF COMMERCE AND INDUSTRY}

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

^{NUMBER OF EMPLOYEES:}

^{* COMPANY - 2008: 12}

^{NO OTHER TRADE INFORMATION WAS AVAILABLE ON 07/01/2008.}

^{THE IMMEDIATE AND ULTIMATE HOLDING COMPANY IS HANWA CO. LTD., INCORPORATED IN JAPAN.}

^{NUMBER OF EMPLOYEES (28 FEBRUARY):}

^{* COMPANY - 2006: NOT AVAILABLE (2005: NOT AVAILABLE)}

^{* GROUP - 2006: - (2005: -)}

^{REGISTERED AND BUSINESS ADDRESS:}

^{20 CECIL STREET}

^{#20-06/07 EQUITY PLAZA}

^{SINGAPORE 049705}

^{DATE OF CHANGE OF ADDRESS: 28/11/2003}

^{- RENTED PREMISE}

^{- PREMISE OWNED BY: D.L. PROPERTIES LTD.}

^WEBSITE:

^{http://www.hanwa.co.jp}

^EMAIL:

^{sp_admin@hanwa.co.jp}

MANAGEMENT

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

^{1) KENZO SADA, A JAPANESE}

^{- BASED IN SINGAPORE.}

^{2) HIROSHI EBIHARA, A JAPANESE}

^{- BASED IN JAPAN.}

^{3) TADAHIKO KAIDA, A JAPANESE}

^{- BASED IN JAPAN.}

^{4) HAJIME SHINKUMA, A JAPANESE}

^{- BASED IN JAPAN.}

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 6.1% IN QUARTER 1 OF 2007 AFTER A 6.6% GROWTH IN QUARTER 4 OF 2006. THE GROWTH MOMENTUM EASED SLIGHTLY TO 7.6% IN 1Q 2007, COMPARED WITH 7.9% A QUARTER EARLIER. GROWTH IN QUARTER 1 WAS LED BY THE FINANCIAL SERVICES AND CONSTRUCTION SECTORS. THE MANUFACTURING SECTOR CONTINUED TO EXPERIENCE A MODERATION IN GROWTH.

THE FINANCIAL SERVICES SECTOR SIGNIFICANTLY INCREASED BY 13% IN 1Q 2007 ON THE HEELS OF THE 11% GROWTH A QUARTER AGO. THE STRONG PERFORMANCE WAS ACROSS ALL MAJOR FINANCIAL SEGMENTS, PARTICULARLY IN THE CAPITAL AND MONEY MARKETS. FUND MANAGEMENT ACTIVITIES REMAINED BOUYANT, IN LINE WITH THE CONTINUED STRENGTH IN ECONOMIC CLIMATE. SIMILARLY, BANKS SAW STRONG GROWTH, BOUYED BY SUSTAINED RESILIENCE IN THE ASIA DOLLAR MARKET AS WELL AS A STEADY INCREASE IN DOMESTIC LENDING ACTIVITY.

THE CONSTRUCTION SECTOR GREW BY 9.7% IN 1Q 2007, ITS STRONGEST GROWTH IN 9 YEARS. CERTIFIED PAYMENTS INCREASE BY 9.5% IN 1Q 2007, SUPPORTED BY STRONG GROWTH IN THE PRIVATE RESIDENTIAL, COMMERCIAL AND INDUSTRIAL SEGMENTS AS WELL AS PUBLIC RESIDENTIAL SEGMENT. HOWEVER, CONTRACTS AWARDED FELL BY 11% IN 1Q 2007, DUE MAINLY TO THE DROP IN THE PRIVATE COMMERCIAL AND PUBLIC INSTITUTIONAL SEGMENTS.

MANUFACTURING SECTOR INCREASED BY 4.3% IN 1Q 2007, DOWN FROM 7.7% IN THE PREVIOUS QUARTER. BOTH BIOMEDICAL MANUFACTURING (-5.0%) AND PRECISION ENGINEERING (-0.7%) CLUSTERS SAW LOWER PRODUCTION DURING THE QUARTER. THE ELECTRONICS CLUSTER, HOWEVER, RECOVERED FROM A 4.1% CONTRACTION IN 4Q 2006 TO REGISTER AN INCREASE OF 2.6% IN 1Q 2007. THE TRANSPORT ENGINEERING CLUSTER CONTINUED TO EXPAND STRONGLY AT 23%, FOLLOWING A 25% INCREASE IN 4Q 2006.

THE WHOLESALE AND RETAIL TRADE SECTOR EXPANDED 6.7% IN 1Q 2007 AFTER A 6.9 GROWTH IN 4Q 2006. RETAIL SALES GROWTH EASED FROM 7.9% IN THE PREVIOUS QUARTER TO 6.1% IN 1Q 2007, MAINLY DUE TO A DECELERATION IN MOTOR VEHICLES SALES. EXCLUDING MOTOR VEHICLES, RETAIL SALES ROSE BY 5.9%, UP FROM 4.2% IN 4Q 2006. IN THE WHOLESALE SEGMENT, GROWTH OF NON-OIL RE-EXPORTS REMAINED FIRM AT 5.9%, SLOWER THAN 6.3% IN 4Q 2006.

THE TRANSPORT AND STORAGE SECTOR GREW 4.4% IN 1Q 2007, UP FROM 4.0% A QUARTER EARLIER. THE AIR SEGMENT SAW A SLOWDOWN DUE TO A MODERATION IN AIR PASSENGER TRAFFIC GROWTH AND A DECLINE IN AIR CARGO. STRONGER ACTIVITY WAS RECORDED IN THE SEA SEGMENT ON THE BACK OF BETTER PERFORMANCE IN SEA CARGO HANDLED AND CONTAINER THROUGHPUT.

THE HOTELS AND RESTAURANTS SECTOR REGISTERED A SLOWER GROWTH OF 4.7% IN 1Q 2007, DOWN FROM 6.1% 4Q 2006. VISITOR ARRIVALS GREW AT A MORE MODEST PACE OF 4.1% COMPARED TO 8.4% IN THE PREVIOUS QUARTER. THE INCREASE IN HOTEL ROOM REVENUE MODERATED FROM THE 21% GAIN IN 4Q 2006 TO 14% IN 1Q 2007. HOWEVER, THE AVERAGE OCCUPANCY RATE OF HOTELS REMAINED HIGH AT 87%, A 4.3% POINTS INCREASE OVER THE CORRESPONDING PERIOD LAST YEAR.

THE INFORMATION AND COMMUNICATIONS SECTOR GREW 6.6% IN 1Q 2007, UP FROM 6.0% IN THE PREVIOUS QUARTER. WHILE THE IT SEGMENT SAW SOME MODERATION IN ACTIVITIES, THE TELECOMMUNICATIONS SEGMENT PERFORMED BETTER. INTERNATIONAL TELEPHONE CALL DURATION WENT UP SHARPLY BY 19%, UP FROM 11% IN 4Q 2006. GROWTH IN THE NUMBER OF MOBILE SUBSCRIBERS AND BROADBAND SUBSCRIBERS ALSO REMAINED STRONG DURING THE QUARTER.

BUSINESS SERVICES SECTOR EXPANDED BY 6.6% IN 1Q 2007, BETTER THAN THE 5.4% POSTED IN 4Q 2006. ROBUST PERFORMANCE WAS SEEN IN THE REAL ESTATE SEGMENT ON THE BACK OF CONTINUED STRENGTH IN THE LUXURY PROPERTY MARKET. THE SECTOR WAS ALSO WELL SUPPORTED BY THE OTHER SEGMENTS, PARTICULARLY BUSINESS REPRESENTATIVE OFFICES, AND BUSINESS & MANAGEMENT CONSULTANCY ACTIVITIES.

OUTLOOK

THE ECONOMIC OUTLOOK IS GENERALLY POSITIVE BUT SOME DOWNSIDE RISKS REMAIN. THESE INCLUDE A SLOWDOWN IN THE US ECONOMY, VULNERABILITY OF OIL PRICES TO SUPPLY SHOCKS AND A DISORDERLY UNWINDING OF GLOBAL UNBALANCES. BARRING THESE UNCERTAINTIES, ECONOMIC GROWTH IS EXPECTED TO REMAIN HEALTHY IN 2007.

BUSINESS SENTIMENTS ARE GENERALLY POSITIVE IN THE FINANCIAL SERVICES INDUSTRY. BANKS AND FINANCE COMPANIES, FUND MANAGEMENT FIRMS AND INSURANCE COMPANIES EXPECT AN IMPROVEMENT IN THE BUSINESS CLIMATE IN THE COMING MONTHS.

AN OVERALL NET WEIGHTED BALANCE OF 61% OF FIRMS IN THE REAL ESTATE INDUSTRY EXPECTS BETTER BUSINESS CONDITIONS FOR THE NEXT 6 MONTHS. WITHIN THE INDUSTRY, REAL ESTATE DEVELOPERS AND AGENTS FORESEE BRISK BUSINESS ACTIVITY AHEAD.

MANUFACTURING SECTORS ARE MORE OPTIMISTIC IN THE NEXT 6 MONTHS COMPARED TO THE FIRST QUARTER OF THE YEAR. OVERALL, A WEIGHTED 30% OF MANUFACTURERS FORESEE AN IMPROVED OUTLOOK, WHILE 4% PREDICT DETERIORATION. THIS RESULTS IN A NET WEIGHTED BALANCE OF 26% OF MANUFACTURERS EXPECTING BUSINESS CONDITIONS TO IMPROVE, WHICH IS HIGHER THAN 7% RECORDED A QUARTER AGO.

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

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

WITHIN THE TRANSPORT AND STORAGE INDUSTRY, A NET WEIGHTED BALANCE OF 18% OF FIRMS FORECASTS IMPROVED BUSINESS PROSPECTS FOR THE NEXT 6 MONTHS. IN PARTICULAR, FIRMS IN THE WATER TRANSPORT AND SUPPORTING SERVICES EXPECT HIGHER LEVEL OF BUSINESS ACTIVITY.

HOTELIERS PROJECT A FAVOURABLE BUSINESS OUTLOOK, WHICH IS IN TANDEM WITH THE POSITIVE SENTIMENTS IN THE TOURISM MARKET. FOR THE CATERING TRADE INDUSTRY, BUSINESS OUTLOOK IN THE COMING MONTHS REMAINS THE SAME.

FIRMS IN THE INFORMATION AND COMMUNICATION INDUSTRY ANTICIPATES A HIGHER LEVEL OF BUSINESS ACTIVITY, WITH A POSITIVE NET WEIGHTED BALANCE OF 12%.

IN THE BUSINESS SERVICES INDUSTRY, AN OVERALL NET WEIGHTED BALANCE OF 24% OF FIRMS EXPRESSES POSITIVE SENTIMENTS. THESE INCLUDE FIRM ENGAGED IN RENTING OF CONSTRUCTION & INDUSTRIAL MACHINERY, ARCHITECTURAL & ENGINEERING, SPECIALISED DESIGN AND LABOUR RECRUITMENT SERVICES.

EXTRACTED FROM: MINISTRY OF TRADE AND INDUSTRY, SINGAPORE

SINGAPORE DEPARTMENT OF STATISTICS

CHANNELNEWS ASIA

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