MIRA INFORM REPORT

Report Date :

18.07.2008

IDENTIFICATION DETAILS

Name :	INTERNATIONAL COFFEE TRADERS PTE. LTD.
Registered Office :	77 High Street#06-04 High Street Plaza
Country :	Singapore
Financials (as on) :	30.06.2006
Date of Incorporation :	^07.02.2006
Com. Reg. No.:	^200601600D
Legal Form :	^Pte Ltd
Line of Business :	To act as General Importers and Exporters

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

INTERNATIONAL COFFEE TRADERS PTE. LTD.

Line Of Business 

TO ACT AS GENERAL IMPORTERS AND EXPORTERS

Parent Company

SHANKAR'S EMPORIUM (PRIVATE)

(PERCENTAGE OF SHAREHOLDINGS: 79.99%)

Financial Elements

FY 2006

COMPANY

Sales : S$

Networth : S$ 393,048

Paid-Up Capital : S$ 500,001

Net result : S$ -106,953

Return on Equity(%) : -27.21

Leverage Ratio : 2.30

COMPANY IDENTIFICATION

^{Subject Company : INTERNATIONAL COFFEE TRADERS PTE. LTD.}

^{Former Name : -}

^{Business Address : 77 HIGH STREET}

^{#06-04 HIGH STREET PLAZA}

^{Town : SINGAPORE}

^{Postcode : 179433}

^{Country : Singapore}

^{Telephone : 6337 4450}

^{Fax : 6339 9667}

^{ROC Number : 200601600D}

SUMMARY

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

^{Legal Form : Pte Ltd}

^{Date Inc. : 07/02/2006}

^{Previous Legal Form : -}

^{Summary year : 30/06/2006}

^{Sales : -}

^{Networth : 393,048}

^{Capital : -}

^{Paid-Up Capital : 500,001}

^{Employees : 100}

^{Net result : -106,953}

^{Share value : 1}

^{Auditor : RSM CHIO LIM}

^{BASED ON ACRA'S}

^{NO. OF SHARES CURRENCY AMOUNT}

^{ISSUED ORDINARY 500,001 SGD 500,001}

^{PAID-UP ORDINARY - SGD 500,001}

REFERENCES

^{Litigation : No}

^{Company status : TRADING}

^{Started : 07/02/2006}

PRINCIPAL(S)

^{LANGDON MARTIN F5590761R Director}

DIRECTOR(S)

^{LANGDON MARTIN F5590761R Director}

^{Appointed on : 07/02/2006}

^{Street : 17 NASSIM ROAD}

^#03-04

^{NASSIM PARK}

^{Town: SINGAPORE}

^{Postcode: 258391}

^{Country: Singapore}

^{MOHANDAS JAMNADAS BHOJWANI S0089782E Company Secretary}

^{Appointed on : 08/03/2006}

^{Street : 34A BRANKSOME ROAD}

^{Town: SINGAPORE}

^{Postcode: 439569}

^{Country: Singapore}

ACTIVITY(IES)

^{IMPORTERS And EXPORTERS Code: 11760}

^{BASED ON ACRA'S RECORD}

^{1) GENERAL WHOLESALE TRADE (INCLUDING GENERAL IMPORTERS AND EXPORTERS)}

CHARGES

No Charges On Premises/Property In Our Database

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

SHAREHOLDERS(S)

^{SHANKAR'S EMPORIUM (PRIVATE) 400,000 Company}

^{Street : 77 HIGH STREET}

^#06-04

^{HIGH STREET PLAZA}

^{Town: SINGAPORE}

^{Postcode: 179433}

^{Country: Singapore}

^{LANGDON MARTIN 1 Private Person}

^{Street : 17 NASSIM ROAD}

^#03-04

^{NASSIM PARK}

^{Town: SINGAPORE}

^{Postcode: 258391}

^{Country: Singapore}

^{MOHANDAS JAMNADAS BHOJWANI 100,000 Private Person}

^{Street : 34A BRANKSOME ROAD}

^{Town: SINGAPORE}

^{Postcode: 439569}

^{Country: Singapore}

HOLDING COMPANY

^{SHANKAR'S EMPORIUM (PRIVATE) 197600365H % : 79.99}

SUBSIDIARY(IES)

No Participation In Our Database

PAYMENT HISTORY AND EXPERIENCES

^{Trade Morality : AVERAGE}

^{Liquidity : SUFFICIENT}

^{Payments : REGULAR}

^{Trend : UNKNOWN}

^{Financial Situation : AVERAGE}

FINANCIAL ELEMENTS

^{Audit Qualification: UNQUALIFIED (CLEAN)}

^{Date Account Lodged: 30/04/2007}

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

^{Number of weeks: 19}

^{Consolidation Code: COMPANY}

^{--- ASSETS ---}

^{Tangible Fixed Assets: 86}

^{Total Fixed Assets: 86}

^{Inventories: 1,176,000}

^{Cash,Banks, Securities: 57,898}

^{Other current assets: 64,029}

^{Total Current Assets: 1,297,927}

^{TOTAL ASSETS: 1,298,013}

^{--- LIABILITIES ---}

^{Equity capital: 500,001}

^{Profit & lost Account: -106,953}

^{Total Equity: 393,048}

^{Other Short term Liab.: 902,915}

^{Prepay. & Def. charges: 2,050}

^{Total short term Liab.: 904,965}

^{TOTAL LIABILITIES: 904,965}

PROFIT & LOSS ACCOUNT

^{Net Sales -}

^{Purchases,Sces & Other Goods: -}

^{Gross Profit: -}

^{NET RESULT BEFORE TAX: -106,953}

^{Tax : -}

^{Net income/loss year: -106,953}

^{Depreciation: 43}

^{Directors Emoluments: 14,000}

RATIOS

^30/06/2006

^{Return on Equity(%): -27.21 -27.21}

^{Return on Assets(%): -8.24 -8.24}

^{Net Working capital: 392962.00 0.00}

^{Cash Ratio: 0.06 0.06}

^{Quick Ratio: 0.06 0.06}

^{Current ratio: 1.43 1.43}

^{Leverage Ratio: 2.30 2.30}

^{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 STATEMENTS FOR THE YEAR ENDED 30 JUNE 2006 COVERS THE PERIOD FROM 7 FEBRUARY 2006 (DATE OF INCORPORATION) TO 30 JUNE 2006, A TOTAL OF 19 WEEKS.}

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

^{NET WORTH:}

^{THE BALANCE SHEET WAS CONSIDERED PASSABLE. NET WORTH WAS S$393,048 IN FY 2006 WITH ACCUMULATED LOSS OF S$106,953.}

^LEVERAGE:

^{IN THE SHORT-TERM, SUBJECT WAS LARGELY FINANCED BY OTHER SHORT TERM LIABILITIES WHICH MADE UP 99.77% OF THE TOTAL CURRENT LIABILITIES AND}

^{AMOUNTED TO S$902,915. THE BREAKDOWN WAS AS FOLLOWS:}

^{*OTHER PAYABLES - 2006: S$1,407}

^{*AMOUNT DUE TO HOLDING COMPANY - 2006: S$901,508}

^{IN ALL, LEVERAGE RATIO WAS REGISTERED AT 2.30 TIMES IN FY 2006. A LOWER RATIO WOULD BE MORE DESIRABLE AS THE LOWER THE RATIO, THE GREATER THE FINANCIAL SAFETY AND OPERATING FREEDOM FOR THE COMPANY.}

^LIQUIDITY:

^{IN GENERAL, SUBJECT'S LIQUIDITY SITUATION WAS PASSABLE. NET WORKING CAPITAL STOOD AT S$392,962. BOTH CURRENT AND QUICK RATIO WERE REGISTERED AT 1.43 TIMES AND 0.06 TIMES RESPECTIVELY IN FY 2006.}

^{CASH AND CASH EQUIVALENTS COMPRISED OF:}

^{*CASH AT BANK - 2006: S$57,897}

^{*CASH IN HAND - 2006: S$1}

^{PROFITABILITY:}

^{NO REVENUE WAS GENERATED IN FY 2006 AS THE COMMPANY HAS NOT BEGUN}

^{OPERATIONS FOR THE FINANCAIL PERIOD ENDED JUNE 30, 2006. A NET LOSS OF}

^{S$106,953 WAS INCURRED IN FY 2006.}

^{DEBT SERVICING:}

^{DEBT SERVICING PROBLEMS MIGHT BE EXPECTED SINCE THE COMPANY HAS NOT COMMENCED ANY TRADING ACTIVITIES SINCE THE DATE OF INCORPORATION.}

NOTES TO FINANCIAL STATEMENTS

^{COMPARATIVE FIGURES}

^{THE FINANCIAL STATEMENTS ARE MADE FOR THE PERIOD FROM FEBRUARY 7, 2006 (DATE OF INCORPORATION) TO JUNE 30, 2006. THIS BEING THE FIRST SET OF FINANCIAL STATEMENTS, THERE ARE NO COMPARATIVE FIGURES.}

^{SUBSEQUENT EVENTS}

^{SUBSEQUENT TO THE FINANCIAL PERIOD END THE COMPANY, HAS INVESTED S $3,773,360 IN THE SUBSIDIARY.}

^{SALARIES AND EMPLOYEE BENEFITS}

^{THERE WERE NO EMPLOYEES AS OF JUNE 30, 2006 EXCEPT THE DIRECTORS OF THE COMPANY.}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 07/02/2006 AS A LIMITED PRIVATE COMPANY AND IS TRADING UNDER ITS PRESENT NAMESTYLE AS "INTERNATIONAL COFFEE TRADERS PTE. LTD.".}

^{AS AT 14/07/2008, THE COMPANY HAS AN ISSUED AND PAID-UP CAPITAL OF 500,001 SHARES, OF A VALUE OF S$500,001.}

^{PRINCIPAL ACTIVITIES:}

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

^{(1) GENERAL WHOLESALE TRADE (INCLUDING GENERAL IMPORTERS AND EXPORTERS)}

^{DURING THE FINANCIAL YEAR(S), UNDER REVIEW, SUBJECT'S PRINCIPAL ACTIVITIES ARE TO ACT AS GENERAL IMPORTERS AND EXPORTERS.}

^{THE COMPANY HAS NOT COMMENCED ANY TRADING ACTIVITIES SINCE THE DATE OF INCORPORATION.}

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

^{INFORMATION ON ITS HOLDING COMPANY:}

^BACKGROUND:

^{SHANKAR'S COMMENCED ITS OPERATIONS IN SINGAPORE IN 1957. FROM 1981, THE COMPANY HAS BEEN A LEADING TRADER IN CONSUMER ELECTRONICS GOODS, HOUSEHOLD APPLIANCES AND OFFICE EQUIPMENTS.}

^{TODAY, SHANKAR'S HAS A PRESENCE IN DUBAI, RUSSIA, THE USA, VIETNAM, AUSTRALIA AND NIGERIA, AND EMPLOYS 150 STAFF WORLDWIDE. IT OPERATES ITS OWN WAREHOUSE IN SINGAPORE WITH AN AREA OF 200,000 SQ FT, AS WELL AS ONE IN JEBEL ALI, DUBAI.}

^{SHANKAR'S TRADES GLOBALLY - ITS MARKETS INCLUDE AFRICA, ASIA, RUSSIA, THE CIS, LATIN AMERICA, THE MIDDLE EAST, THE USA, AND COUNTRIES IN TH MEDITARRANEAN AND THE CARIBBEAN.}

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

^GATHERED:

^ACTIVITIES:

^{* TRADING OF ELECTRONICS}

^{IMPORT COUNTRY:}

^{* JAPAN}

^{EXPORT COUNTRIES:}

^{* AFRICA}

^{* INDIA}

^{NUMBER OF EMPLOYEES: * 2007: ABOUT 100}

^{SUBJECT PERSONNEL MENTIONED THAT THE COMPANY IS IN OPERATION. IT ACTED AS THE SISTER COMPANY OF SHANKAR'S EMPORIUM (PRIVATE) LIMITED. THUS, EXPLANING THE REASON WHY THEY HAVE THE SAME ADDRESS AND CONTACT NUMBERS.}

^{NO OTHER TRADE INFORMATION WAS AVAILABLE.}

^{THE COMPANY IS A SUBSIDIARY OF 'SHANKAR'S EMPORIUM (PRIVATE) LIMITED',}

^{INCORPORATED IN THE REPUBLIC OF SINGAPORE, WHICH IS ALSO THE ULTIMATE HOLDING COMPANY.}

^{DURING THE FINANCIAL PERIOD, THE COMPANY HAS SET UP A WHOLLY OWNED SUBSIDIARY, 'HIANG KIE INDUSTRIES LTD' INCORPORATED IN THE SOCIALIST REPUBLIC OF VIETNAM SUBSEQUENT TO THE FINANCIAL PERIOD END THE COMPANY HAS OBTAINED PERMISSION FROM INVESTMENT LICENSE ISSUING BODY, VIETNAM, TO INVEST UP TP S$5,537,000 (US$3,500,000) IN THE SUBSIDIARY. AS AT FINANCIAL PERIOD END NO AMOUNT HAS BEEN INVESTED.}

^{SUBSEQUENT TO THE FINANCIAL PERIOD END THE COMPANY, HAS INVESTED S $3,773,360 IN THE SUBSIDIARY.}

^{THE PRINCIPAL ACTIVITY OF THE SUBSIDIARY IS TO OPERATE A FACILITY FOR PROCESSING AND STORAGE OF COFFEE. THE SUBSIDIARY HAA NOT COMMENCED ANY OPERATIONS DURING THE FINANCIAL PERIOD.}

^{REGISTERED AND BUSINESS ADDRESS:}

^{77 HIGH STREET}

^#06-04

^{HIGH STREET PLAZA}

^{SINGAPORE 179433}

^{DATE OF CHANGE OF ADDRESS: 07/02/2006}

^{- PROPERTY RECORD WAS NOT AVAILABLE}

^WEBSITE:

^{http://www.shankars.com (HOLDING COMPANY)}

^EMAIL:

^{information@shankars.com}

MANAGEMENT

^{THE DIRECTOR AT THE TIME OF THIS REPORT IS:}

^{1) LANGDON MARTIN, A BRITISH}

^{- BASED IN SINGAPORE}

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

THE WHOLESALE AND RETAIL TRADE SECTOR GREW BY 6.0% IN 4Q 2007, SLOWER THAN THE 6.8% GROWTH IN 3Q 2007. RETAIL SALES FELL BY 2.5%, FOLLOWING A 1.5% GROWTH IN 3Q 2007.

DOMESTIC WHOLESALE TRADE INDEX

THE OVERALL DOMESTIC WHOLESALE TRADE ROSE BY 22.2% IN 4Q 2007 OVER 4Q 2006.

EXCLUDING PETROLEUM, DOMESTIC SALES GREW BY 4.8%.

THE RISE IN THE OVERALL INDEX WAS MAINLY DUE TO HIGHER SALES OF PETROLEUM AND PETROLEUM PRODUCTS (47.3%), TIMBER, PAINTS AND CONSTRUCTION MATERIALS (29.8%). OTHER WHOLESALE SEGMENTS THAT REPORTED DOUBLE-DIGIT GROWTH WERE WHOLESALING OF GENERAL WHOLESALE TRADE, HOUSEHOLD EQUIPMENT AND FURNITURE AND CHEMICALS AND CHEMICAL PRODUCTS.

ON THE OTHER HAND, WHOLESALE SEGMENT THAT REPORTED LOWER SALES WERE ELECTRONIC COMPONENTS (-35.8%).

AT CONSTANT PRICES, THE OVERALL DOMESTIC WHOLESALE TRADE ROSE BY 1.6% IN 4Q 2007 OVER 4Q 2006. EXCLUDING PETROLEUM, DOMESTIC SALES ROSE SLIGHTLY BY 0.2%.

ON A QUARTER-OVER-QUARTER BASIS, THE OVERALL DOMESTIC WHOLESALE TRADE IN 4Q 2007 ROSE BY 7.1% OVER 3Q 2007. EXCLUDING PETROLEUM, DOMESTIC SALES CONTRACTED BY 2.9%.

THE MAJORTIY OF THE WHOLESALE SECTORS RECORDED HIGHER DOMESTIC SALES IN 4Q 2007 OVER PREVIOUS QUARTER. PETROLEUM AND PETROLEUM PRODUCTS EXPANDED BY 20.0%. GENERAL WHOLESALE TRADE AND INDUSTRIAL AND CONSTRUCTION MACHINERY ALSO REGISTERED

DOUBLE-DIGIT GROWTH OVER PREVIOUS QUARTER.

ON THE OTHER HAND, SALES OF FOOD, BEVERAGES AND TOBACCO AND ELECTRONIC COMPONENTS FELL IN 4Q 2007 OVER 3Q 2007.

FOREIGN WHOLESALE TRADE INDEX

THE OVERALL FOREIGN WHOLESALE TRADE FOR 4Q 2007 ROSE BY 27.0%, IN COMPARISON TO 4Q 2006. EXCLUDING PETROLEUM, IT EXPANDED BY 15.3%

MOST OF THE SECTORS REPORTED HIGHER SALES. DOUBLE-DIGIT GROWTH RATES FOR OVERSEAS SALES WERE RECORDED BY FOOD, BEVERAGES AND TOBACCO (40.6%) PETROLEUM AND PETROLEUM PRODUCTS (39.9%) SHIP CHANDLERS AND BUNKERING (24.3%) INDUSTRIAL AND CONSTRUCTION MACHINERY (18.2%) CHEMICALS AND CHEMICAL PRODUCTS (16.4%) ELECTRONIC COMPONENTS (12.1%) TIMBER, PAINT AND CONSTRUCTION MATERIALS (11.1%).

ON THE OTHER HAND, OVERSEAS SALES OF TELECOMMUNICATIONS AND COMPUTERS FELL BY 2.8%

IN 4Q 2007 OVER 4Q 2006.

AT CONSTANT PRICES, THE OVERALL INDEX ROSE BY 11.5% IN 4Q 2007 OVER 4Q 2006.

EXCLUDING PETROLEUM, FOREIGN WHOLESALE TRADE GREW BY 15.1%.

ON A QUARTER-OVER-QUARTER BASIS, THE OVERALL FOREIGN WHOLESALE TRADE IN 4Q 2007 ROSE BY 11.7% OVER 3Q 2007. EXCLUDING PETROLEUM, IT GREW BY 6.0%.

ALL WHOLESALE SECTORS RECORDED BETTER BUSINESS IN 4Q 2007 WITH THE EXCEPTION OF THE ELECTRONIC COMPONENTS SECTOR. THOSE SECTORS THAT REGISTERED DOUBLE-DIGIT GROWTH WERE WHOLESALE SECTORS OF PETROLEUM AND PETROLEUM PRODUCTS, TELECOMMUNICATIONS AND COMPUTERS, INDUSTRIAL AND CONSTRUCTION MACHINERY AND CHEMICALS AND CHEMICAL PRODUCTS.

RETAIL TRADE

THE OVERALL RETAIL SALES CONTRACTED BY 2.5%, IN CONTRAST TO THE 1.5% GROWTH IN 3Q 2007. THE SECTOR THAT RECORDED THE LARGEST DECLINE WERE MOTOR VEHICLES, FOLLOWED BY PROVISION AND SUNDRY SHOPS, FOOD AND BEVERAGES, WATCHES AND JEWELLERY AND MEDICAL GOODS AND TOILETRIES. EXCLUDING MOTOR VEHICLES, RETAIL SALES ROSE BY 5.2%, A DECLINE FROM THE 6.O% GROWTH IN 3Q 2007.

NEWS

SURPRISING DROP IN RETAIL SALES

RETAIL SALES FELL UNEXPECTEDLY IN FEBRUARY, THE FIRST TIME IN SEVEN MONTHS, AS INFLATION HIT 26 YEAR HIGHS AND WORRIES GREW ABOUT THE WORLD ECONOMY. SHOPS, SUPERMARKETS AND OTHER RETAILERS SAW REVENUES FELL 1.3% FROM A YEAR EARLIER, AS CAR SALES DECLINED 10.6% AND FOOD AND BEVERAGES SALES PLUNGED 21.8%.

THE OVERALL CONTRACTION BY THE SECTOR WOULD HAVE BEEN BIGGER IF NOT FOR MUCH HIGHER PRICES THIS YEAR. IN CONSTANT PRICES TERMS, SALES FELL 5.7%. THIS IS THE WORST READING SINCE THE 5.0% DECLINE IN MARCH 2007, IF ONE WERE TO IGNORE THE 2.0% CONTRACTION IN JULY THAT WAS DUE TO THE HIKE IN THE GOODS AND SERVICES TAX,” SAID HSBC ECONOMIST PRAKRITI SOFAT.

ANALYSTS SAID RISING LIVING COSTS AND UNCERTAINTY ABOUT THE ECONOMY WOULD AFFECT SINGAPORE CONSUMER’S SPENDING THIS YEAR. MANY, HOWEVER, REMAIN LARGELY OPTIMISTIC ABOUT THE DOMESTIC RETAIL SCENE, SAYING THE POOR FEBRUARY SHOWING COULD BE A STATISTICAL BLIP.

DOMESTIC DEMAND CONDITIONS REMAIN POSITIVE, HELPED BY THE GOVERNMENT WHICH IS GIVING CASH FROM LAST YEAR’S SURPLUS TO THE WHOLE POPULATION AND ISSUING FOOD VOUCHERS TO THE POOR. “LOW INTEREST RATES AND A HEALHY JOBS MARKET SHOULD KEEP SPENDING FIRM,” SAID HSBC’S MS SOFAT. SHE ADDED THAT FEBRUARY’S DECLINE WAS DUE LARGELY TO A HIGH BASE SET THE PREVIOUS YEAR AND PREDICTED THAT MARCH SALES WOULD BOUNCE BACK WITH A 15.0% SURGE. ALSO, IF COMPARED WITH JANUARY, FEBRUARY SALES ROSE 8.8% AFTER ADJUSTING FOR SEASONAL EFFECTS. THIS WAS THE STRONGEST PERFORMANCE IN FOUR YEARS, SHE SAID.

CIMB-GK ECONOMIST SONG SENG WUN SAID MUCH OF THE POOR PERFORMANCE CAME ON THE BACK OF WEAKER CAR SALES. EXCLUDING THOSE, RETAIL SALES WOULD HAVE RISEN 2.9%. CAR SALES HAVE BEEN HURT SINCE OCTOBER BY RISING CERTIFICATE OF ENTITLEMENT PRICES, CAUSED BY AN EXPECTED CUT IN QUOTAS FROM NEXT MONTH AND SURGING PUMP PRICES.

OUTLOOK

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.

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.42.78
UK Pound	1	Rs.85.51
Euro	1	Rs.67.90

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