MIRA INFORM REPORT

Report Date :

18.01.2008

IDENTIFICATION DETAILS

Name :	VIETTIEN GARMENT JOINT STOCK CORPORATION

Registered Office :	No. 7 Le Minh Xuan Street, Ward 7, Tan Binh Dist, HoChiMinh City

Country :	Vietnam

Financials (as on) :	31.12.2006

Date of Incorporation :	1976

Com. Reg. No.:	4103008950

Legal Form :	Joint Stock Company

Line of Business :	Production of clothes of various kinds Providing printing and photocopy machines, computers and other equipment

RATING & COMMENTS

MIRA’s Rating :

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 IDENTIFICATION & LEGAL FORM

English Name

VIETTIEN GARMENT JOINT STOCK CORPORATION

Vietnamese name

TONG CONG TY CO PHAN MAY VIET TIEN

Abbreviate name

VINATEX - VTEC

Original founded

1976

Type of Business

Joint Stock Company

Business Registration No.

4103008950

Date of Issuance

January 2^nd, 2008

Place of Issuance

Planning and Investment Department of HoChiMinh City

Registered Capital

230,000,000,000 VND

Tax Code

0300401524

Total Employees

About 5,800 employees

Qualification

Average

Note: In early 2007, VIETTIEN GARMENT IMPORT-EXPORT COMPANY (the given name by client) has re-organized to VIETTIEN GARMENT IMPORT-EXPORT CORPORATION.

And in January this year - 2008, the subject has just changed of type to be Joint Stock Company. Following its former legal form:

English Name

VIETTIEN GARMENT IMPORT - EXPORT CORPORATION

Former English Name

VIET TIEN GARMENT IMPORT - EXPORT COMPANY

Vietnamese name

TONG CONG TY MAY VIET TIEN

Abbreviate name

VTEC

Original founded

1976

Type of Business

State Owned Company

Established Decision No.

05/2007/QD-BCN

Date of issuance

January 11^th, 2007

Established Decision No.

214/CNNTCLD

Date of issuance

March 24^th, 1993

Place of issuance

Ministry of Industry

Business Registration No.

4106000342

Date of issuance

March 21^st, 2007

Former Business Registration

102570

Date of issuance

April 13^th, 1993

Place of issuance

Planning and Investment Department of HoChiMinh City

Registered Capital

129,629,339,233 VND

Former Registered Capital

126,461,014,849 VND

Tax Code

0300401524

ADDRESS

Head Office

Address

No. 7 Le Minh Xuan Street, Ward 7, Tan Binh Dist, HoChiMinh City

Country

Vietnam

Business registration No

4103008950

Tel

(84-8) 8640800 (22 lines)

Fax

(84-8) 8645085 - 8654867

vtec@hcm.vnn.vn

Website

www.viettien.com.vn

Branch in Hanoi City

Address

No. 57A Phan Chu Trinh Street, Hoan Kiem Dist, Hanoi City

Business registered No.

0116000878

Date of issuance

December 22^nd, 1998

Place of issuance

Planning and Development Department of Hanoi City

Tel

(84-4) 9332495

Director of branch

Mr. DO YEN SON

Branch in Nha Trang City

Address

No. 204 Thong Nhat Street

City/ Province

Nha Trang City

Business registered No

3716000011

Date of issuance

December 29^th, 1998

Place of issuance

Planning and Development Department of Khanh Hoa Province

Tel

(84-58) 823977

Director of branch

Mr. TRAN DINH TUE

Branch in Da Nang City

Address

No. 102 Nguyen Van Linh Street, Hai Chau District

City/ Province

Da Nang City

Business registered No

3216000174

Date of issuance

August 18^th, 2000

Place of issuance

Planning and Development Department of Da Nang City

Tel

(84-511) 656639 - 656640

Fax

(84-511) 656641

Director of branch

Mr. NGUYEN DINH TRUONG

DIRECTORS

1. NAME

Mr. BUI VAN TIEN

Position

General Director - Legal Representative

Qualification

Management

Date of birth

January 24^th, 1964

Resident

No. 2/1/19 Binh Gia Str, Ward 13, Tan Binh Dist, Hochiminh city

Nationality

Vietnamese

2. NAME

Mr. VU DUC GIANG

Position

Chairman

Qualification

Bachelor

Resident

HoChiMinh City

Nationality

Vietnamese

3. NAME

Mr. NGUYEN DINH TRUONG

Position

Vice Chairman

Qualification

Bachelor

Date of birth

March 13^th, 1948

ID card

No. 022749817

Date of issuance

May 20^th, 2000

Place of issuance

Police Station of HoChiMinh city

Resident

No. 21, Long Hung Street, Ward 7, Tan Binh Dist, HoChiMinh City

Nationality

Vietnamese

4. NAME

Mr. TRAN MINH CONG

Position

Vice General Director - In charge of finance

Qualification

Bachelor

Resident

HoChiMinh City

Nationality

Vietnamese

5. NAME

Mr. PHAN VAN KIET

Position

Vice General Director - In charge of business

Qualification

Bachelor

Resident

HoChiMinh City

Nationality

Vietnamese

6. NAME

Mrs. THACH THI PHONG HUYEN

Position

Vice General Director - In charge of production

Qualification

Bachelor

Resident

HoChiMinh City

Nationality

Vietnamese

7. NAME

Mr. HO NGOC HUY

Position

Vice General Director - In charge of planning & marketing

Qualification

Bachelor

Resident

HoChiMinh City

Nationality

Vietnamese

8. NAME

Mr. TRAN PHUOC NHAT

Position

Vice General Director - In charge of interior

Qualification

Bachelor

Resident

HoChiMinh City

Nationality

Vietnamese

9. NAME

Mrs. NGUYEN TRAM ANH

Position

Chief Accountant

Qualification

Bachelor

Resident

HoChiMinh City

Nationality

Vietnamese

BUSINESS NATURE AND ACTIVITIES

The main business operations of the subject are as follows:

v Production of clothes of various kinds

v Direct imports, exports, commodity transportation and delivery

v Doing business in garment-related materials and supplies

v Doing business in garment-related machines and equipment

v Providing printing and photocopy machines, computers and other equipment

v Providing telephones, fax machines and desktop telephone system

v Providing air-conditioners and supplies (for industries and civil use)

v Providing sea-transportation and air-transportation services

IMPORT & EXPORT ACTIVITIES

IMPORT:

Main import markets of the subject are Taiwan, Japan, Hong Kong, China, USA, France and other countries in Europe.

EXPORT:

The Subject's garment products export to 62 countries including EU, Japan, Canada, USA, Australia, Korea, and Eastern Europe...

BANKERS

1. VIETNAM BANK FOR FOREIGN TRADE (VIETCOMBANK)

Address

No. 29 Ben Chuong Duong Str, Dist 1, HoChiMinh City, Vietnam

Tel

(84-8) 8251317

Fax

(84-8) 8297228

Telex

811234/5 VVB-VT

Swift

BFTVVBVX 007

2. CALYON BANK

Address

No. 21-23 Nguyen Thi Minh Khai Street, District 1, HoChiMinh City, Vietnam

Tel

(84-8) 8295048 - 8296061

Fax

(84-8) 8296065

Swift

CAINVNVX

3. CITI BANK - BRANCH IN HOCHIMINH CITY

Address

No. 115 Nguyen Hue Street, Ben Nghe Ward, Dist 1, HoChiMinh City, Vietnam

Tel

(84-8) 8242118

Fax

(84-8) 8242267

Swift

CITIVNVXHCM

Branch Director

Mr. GREG TROTTER

4. HONGKONG SHANGHAI BANK CORPORATION (HSBC)

Address

No. 235 Dong Khoi Street, District 1, HoChiMinh City, Vietnam

Telephone

(84-8) 829 2288

Fax

(84-8) 823 0530

Swift

HSBCVNVX

Director

Mr. ANDI GENT

SHAREHOLDERS

The subject is a Joint Stock Company. Following are the mainly shareholders:

1. STATE CAPITAL

51 %

Value

117,300,000,000 VND

2. PRIVATE CAPITAL

49 %

Value

112,700,000,000 VND

PAYMENT HISTORY AND EXPERIENCES

Trade Morality

Fair

Liquidity

Fair

Payment status

Fair

Past Financial Situation

Fair

Current Financial Situation

Developed

Litigation Data

No recorded

Bankruptcy

No recorded

Public opinion

Fair

Payment Methods

Direct payment or through its corresponding bank, Foreign remittance by letter of credit (L/C)

FINANCIAL DATA

BALANCE SHEET

Unit: 1,000 000 VND

Balance sheet date

31/12/2006

31/12/2005

31/12/2004

Number of weeks

ASSETS

A -

CURRENT ASSETS

712,979

797,681

679,990

Cash and cash equivalents

66,665

110,277

132,171

Cash

Cash equivalents

II.

Short-term investments

Short-term investments

Provisions for short-term investment of short- term investments in securities

III.

Accounts receivable

353,969

387,456

327,722

Receivable from customers

312,929

307,803

269,457

Repayments to suppliers

12,002

14,397

33,323

Inter- company receivable

8,535

13,165

3,868

Receivable according to the process of construction contracts

Other receivable

25,738

57,942

25,779

Provisions for credit risk

-5,235

-5,851

-4,705

IV.

Inventories

291,165

299,310

214,849

Inventories

Provisions for devaluation of inventories

Other current assets

1,180

638

5,248

Short-term repaid expenses

Taxes receivable

Other current assets

B -

LONG TERM ASSETS

288,043

228,710

208,670

Long term accounts receivable

Long term accounts receivable from customers

Long term inter- company receivable

Other long term receivable

Provisions for bad debts

II.

Fixed assets

115,011

114,400

157,115

Tangible assets

111,053

109,799

155,958

Historical costs

303,256

286,060

357,362

Accumulated depreciation

192,203

176,261

201,404

Financial leasehold assets

659

795

Historical costs

818

Accumulated depreciation

159

In-tangible assets

3,958

3,942

362

Historical costs

6,501

5,764

460

Accumulated depreciation

2,543

1,822

Construction in progress

III.

Investment property

History costs

Accumulated depreciation

IV.

Long term investments

138,295

75,655

50,356

Investments in affiliates

1,934

2,135

Investments in business concerns and joint ventures

84,795

63,284

48,221

Other long term investments

53,485

10,437

Provisions for devaluation of investments in securities

Other long term assets

34,737

38,655

1,199

Long term repaid expenses

Deferred income tax

Other long term assets

TOTAL ASSETS

1,001,022

1,026,391

888,660

LIABILITIES

A -

LIABILITIES

679,551

750,022

609,046

Short term liabilities

577,234

674,329

543,194

Short term debts and loans

121,223

108,491

26,130

Payable to suppliers

310,495

369,495

325,460

Advances from customers

12,132

8,263

8,929

Taxes and other obligations to the State Budget

11,165

10,838

8,115

Payable to employees

83,978

126,147

85,989

Accrued expenses

Inter- company payable

Payable according to the progress of construction contracts

7,672

Other payables

38,241

51,095

80,899

II.

Long term liabilities

102,317

75,693

65,852

Long term account payable to suppliers

3,644

Long term inter- company payable

Other long term payable

7,657

16,075

10,357

Long term debts and loans

94,660

59,618

51,851

Deferred income tax

B -

OWNER’S EQUITY

321,471

276,369

279,614

Owner’s equity

220,326

233,958

210,075

Capital

178,805

168,824

177,481

Share premiums

6,342

Treasury stocks

Differences on asset re-valuation

5,758

3,442

Foreign exchange differences

1,324

Business promotion fund

13,177

34,795

13,343

Financial reserved fund

Other funds

21,904

24,519

14,390

Retained earnings

II.

Other sources and funds

101,145

42,411

69,539

Bonus and welfare funds

92,107

42,411

69,539

Sources of expenditure

9,038

Funds to form fixed assets

TOTAL LIABLITIES AND OWNER’S EQUITY

1,001,022

1,026,391

888,660

PROFIT & LOSE ACCOUNT (INCOME STATEMENT)

Description

F/Y 2006

F/Y 2005

F/Y 2004

Sales

1,727,660

1,593,433

1,585,163

Deductions

6,260

7,460

14,173

Net sales

1,721,400

1,585,973

1,570,990

Costs of goods sold

1,508,706

1,399,147

1,337,999

Gross profit

212,694

186,826

232,991

Financial income

29,011

20,708

21,384

Financial expenses

20,104

19,126

20,906

- In which: Loan interest expenses

Selling expenses

108,633

95,805

119,266

Administrative overheads

65,611

54,618

64,287

10.

Net operating profit

38,450

36,403

49,438

11.

Other income

15,022

18,793

1,572

12.

Other expenses

1,929

2,409

1,071

13.

Other profits

13,093

16,384

501

14.

Profit (loss) before tax

60,450

54,369

50,417

15.

Income tax

11,845

10,825

9,419

16.

Profit (loss) after tax

48,605

43,544

40,998

FINANCIAL FACTORS

Description

FY 2006

FY 2005

FY 2004

Current Liquidity Ratio

1.24

1.18

1.25

Quick Liquidity Ratio

0.73

0.74

0.86

Inventory Circle

5.11

5.44

6.23

Average Receive Period

75.05

89.17

76.14

Utilizing Asset Performance

1.72

1.55

1.77

Liability /Total Asset (%)

67.89

73.07

68.54

Liability /Owner's Equity (%)

211.39

271.38

217.82

Income Before Tax /Total Asset (%) ROA

6.04

5.30

5.67

Income Before Tax /Owner's Equity (%) ROE

18.80

19.67

18.03

Income Before Tax /Total Revenue (%) NPM

3.50

3.41

3.18

Gross Profit /Total Revenue (%) GPM

12.31

11.72

14.70

INTERPRETATION ON THE SCORES

Viet Tien Garment Export and Import Corporation (VTEC) was a state owned company. It was officially established in 1976. In early 2007, it has re-organized from basis Viet Tien Garment Export Import Company (the given name by client), in reality, it only changes the name. And in January this year - 2008, the subject has just changed of type to be Joint Stock Company. And in January this year – 2008, the Subject has changed to Joint Stock company, its current name is Viettien Garment Joint Stock Corporation (VINATEX - VTEC).

The subject is a production and trade company belonging to Vietnam Textile and Garment Group (VINATEX). It registered in many lines of business activities but at present, it focuses on garment manufacture, trade of equipment, materials and accessories for garment industry, household electric appliances and undertaking all services for delivering, receiving and imported - exported commodities.

The subject is the leading company in garment industry. Its main import markets are Taiwan, Japan, Hong Kong, China, USA, France and other countries in Europe. The market share of the subject is largest in this field in Vietnam. Its garment products are much diversified: shirt, T-shirt, jacket, trousers, kaki trousers, pullover and sport wears. However, the strongest point of the subject is man shirt.

The subject’s products are distributed widely in domestic market through more than 20 shops and 300 agents from Northern to Southern areas of Vietnam. Its selling products are following brand names: Viettien, Vee Sendy, and TT-Up. All products are also exported to 62 countries in the world such as EU, Japan, Canada, USA, Australia, Korea, etc…

The premises and facilities of the subject are standard. It operates with big scale. Total area of factories is 5,570,932 square meters and workforce is 20,000 employees. The subject has achieved ISO 9001-2000 certificate No. 69237 by BVQI; SA 8000 certificate No. 114548 by BVQI and WRAP certificate No. 4118 by WRAP.

According to the financial statement, annual turnover and profits of the subject are good. Since 2004, the subject has been coped with quota issues. This caused the decrease in turnover of the subject. However, its total revenue and profit are still increased from years to years.

In 2 next years, the subject anticipates investment 100 billion VND to new build 20,000 m² factory, warehouse in Hoc Mon District. The subject anticipates with Vietnam Textile and Garment Group (VINATEX) and other partners to establish VINATEX investment Joint Stock Company, 2 billion VND enter in sales company on network together with VITAS and 26 billion VND to invest in other fields.

The management capability of the subject is good. Its business operations are very busy. The subject is operating very effectively and it has good developing potential regardless of difficulties. The competitive capability of the subject is strong. The financial situation of the subject is good. It is safe for creditors. The subject has capacity to meet financial commitments. No caution needed for business transactions.

Note

To anticipate financial factors until 2010:

Unit: 1 billion VND

Year	2008	2009	2010
Charter capital	230	250	250
Turnover	1,250	1,250	1,300
Profit	42	43	45
Dividend	12%	12%	12%

The company has STRONG capacity to meet its financial commitments, but has less stability than higher rated companies.

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